<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>ddef14a.txt
<DESCRIPTION>DEFINITIVE PROXY
<TEXT>
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
Bresler & Reiner, Inc.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on 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 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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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 No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
Reg. (S) 240.14a-101.
SEC 1913 (3-99)
<PAGE>
BRESLER & REINER, INC.
401 M STREET, S.W.
WATERSIDE MALL
WASHINGTON, D.C. 20024
----------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
AND PROXY STATEMENT
----------------------------------
Approximate Date of Mailing:
April 25, 2002
TO THE STOCKHOLDERS:
The annual meeting of stockholders of Bresler & Reiner, Inc. (the
"Company") will be held at the offices of the Company, the Waterside Mall, 401 M
Street, S.W., Washington, D.C. on June 20, 2002, at 10:00 a.m. for the following
purposes:
1. To elect a Board of six directors to serve until the next
annual meeting of stockholders and until the election and
qualification of their respective successors; and
2. To consider and transact such other business as may properly
come before the meeting.
This Proxy Statement is furnished by the Board of Directors (the
"Board") of the Company for solicitation of proxies to be used at the annual
meeting, and at any adjournment thereof. If the enclosed proxy card is signed,
dated and returned, all shares represented thereby will be voted as directed
therein. Any proxy may be revoked by the person giving it at any time before it
is exercised, by written notice to the Secretary of the Company. Abstentions and
broker non-votes will not be included in determining the number of votes cast
concerning any matter.
The stock transfer books will not be closed. Stockholders of record on
April 15, 2002, are entitled to notice of and to vote at the annual meeting. On
that date, there were 2,738,906 shares of common stock outstanding. Each share
is entitled to one vote on each of the matters presented at the meeting, and
voting is not cumulative.
Principal Stockholders
The following table lists certain information with respect to those
persons known to management to be the beneficial owners of more than five
percent of the common stock, as well as the number of shares beneficially owned
by all officers and directors as a group and by certain executive officers. This
information has been furnished by such persons.
<PAGE>
Common Stock
Beneficially Owned
as of
December 31, 2001/1//
---------------------
Shares Percent
------ -------
Charles S. Bresler 401 M Street, S.W. 1,022,070 35.99
Washington, DC 20024
Burton J. and 401 M Street, S.W. 848,778 29.89
Anita O. Reiner Washington, DC 20024
The Burton and 401 M Street, S.W. 166,667/3// 5.87
Anita Reiner Washington, DC 20024
Charitable
Remainder Trust
Fleur S. Bresler 401 M Street, S.W. 143,977 5.07
Washington, DC 20024
Certain Executive
Officers:
All directors and
officers as a group 1,873,608/2// 65.98
------------------------------------------------------------------------------
/1// See also Notes 2/ and 3/ under "Election of Directors" below.
-
/2// For information concerning Messrs. Huguely and Oshinsky, see
-
"Election of Directors." Also includes 260 shares owned by Sidney M. Bresler and
750 shares owned by Jean S. Cafardi.
/3// In addition, the trustees of the Trust in their individual capacity
-
have the sole power to vote and invest certain shares aggregating 22,978 shares.
The Trust disclaims beneficial ownership of such shares.
Charles S. Bresler votes the shares shown in the above table as
manager of a limited liability company (the "LLC"). Under the LLC's Operating
Agreement, if Mr. Bresler should resign as manager, die, or otherwise become
unable to serve as manager, then his son, Sidney M. Bresler, becomes manager and
may vote the shares. If Charles S. Bresler ceases to be a member of the LLC, a
majority of the interests held by other members may elect to dissolve the LLC.
Fleur S. Bresler, spouse of Charles S. Bresler, holds a majority of the other
interest in the LLC.
Election of Directors
Six directors are to be elected to hold office until the next Annual
Meeting of stockholders and until the election and qualification of their
respective successors. Management has nominated for election as directors the
persons whose names appear in the table below, all of whom are presently
Directors of the Company. Unless otherwise instructed by stockholders, the
2
<PAGE>
persons named in the enclosed form of proxy will vote all valid proxies received
for the election of such nominees. Management believes that all nominees will be
able to serve as directors, but if this should not be the case, the proxies will
be voted for a substitute nominee or nominees to be designated by management.
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
Name, Age, Present Position with Common Stock Beneficially
Company and Principal Occupation Owned as of December 31, 2001/1//
During Last Five Years Year First Elected
Director Shares Percent
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Charles S. Bresler, 74 1970 1,022,070/2// 35.99
Chief Executive Officer and Chairman
of the Board of Directors
---------------------------------------------------------------------------------------------------
Ralph S. Childs, Jr. 74 Director; retired 1994 0 0.00
since November, 1994 prior to that date
Chairman of the Board of Home
Federal Savings Bank
---------------------------------------------------------------------------------------------------
Stanley S. DeRisio, 72 1974 0 0.00
Director; Retired; Prior to July 1996,
President of Hilb, Rogal and Hamilton
Company of Washington, DC a general
Insurance company, since March 1991
---------------------------------------------------------------------------------------------------
George W. Huguely, III, 69 1974 500 0.02
Director; Chairman of the Board of,
Galliher & Huguely Associates, Inc., a
building supply dealer and a general
partner of The Huguely Companies, a
real estate investment and management
firm
---------------------------------------------------------------------------------------------------
William L. Oshinsky, 59 1994 1,250 0.04
Treasurer and Director
---------------------------------------------------------------------------------------------------
Burton J. Reiner, 73 1970 848,778/3// 29.89
President and Director
---------------------------------------------------------------------------------------------------
</TABLE>
/1// This information has been furnished by each director.
/2// Charles S. Bresler has the sole power to vote and to invest these
shares as manager of a limited liability company which holds the shares. In
addition he may be deemed to share indirectly the power to vote and to invest
143,977 shares which are owned by his spouse; however, he disclaims beneficial
ownership of such shares.
/3// The power to vote and invest 846,015 of these shares is shared with
his spouse.
Family Relationships of Certain Directors and Executive Officers
Charles S. Bresler and Fleur S. Bresler are husband and wife.
Burton J. Reiner and Anita O. Reiner are husband and wife. William L. Oshinsky
is the brother of Anita O. Reiner and brother-in-law of Burton J. Reiner. Sidney
M. Bresler is the son of Fleur S. Bresler and Charles S. Bresler.
3
<PAGE>
The Board held four meetings during the fiscal year. No nominee
attended fewer than 3 of the aggregate of the total meetings of the Board and
the total number of meetings held by all committees of the Board on which he
served.
The Board does not have a nominating committee. Messrs. DeRisio,
Huguely and Childs are members of the Audit Committee of the Board. The Audit
Committee held one meeting during 2001. The Audit Committee was established to
review the Company's accounting and financial reporting systems and internal
financial controls. In addition, the Committee recommends to the Board the
engagement of independent auditors and reviews the scope of their audit, their
fees, the results of their engagement, and the extent of their non-audit
services to the Company, if any.
Audit Committee Report
Pursuant to rules adopted by the SEC designed to improve
disclosures related to the functioning of corporate audit committees and to
enhance the reliability and credibility of financial statements of public
companies, the Audit Committee of Bresler & Reiner, Inc.'s Board of Directors
submits the following report:
The Board of Directors of Bresler & Reiner, Inc. adopted a written
Audit Committee Charter, a copy of which is included as Appendix A to this proxy
statement. All members of the Audit Committee are independent, as independence
is defined in Rule 4200(a)(15) of the National Association of Securities
Dealers' ("NASD") listing standards.
The Audit Committee has reviewed and discussed the audited
financial statements for fiscal year 2001 with management and has discussed with
the independent auditors the matters required to be discussed by SAS No. 61,
"Codification of Statements on Auditing Standards, Communication with Audit
Committees."
The Audit Committee has received written disclosures from the
independent auditors required by Independence Standards Board Standard No. 1,
"Independence Discussions with Audit Committees," and discussed with the
independent auditors the auditors' independence. The Audit Committee has
considered whether the provision of non-audit services by the independent
auditors is compatible with maintaining the auditors' independence. The Audit
Committee was advised that the auditors did not provide any non-audit services.
Based on review and discussions of the audited financial statements
for fiscal year 2001 with management and discussions with the independent
auditors, the Audit Committee recommended to the Board of Directors that the
audited financial statements for fiscal year 2001 be included in the Company's
Annual Report on Form 10-K for the year ended December 31, 2001, as filed with
the Securities and Exchange Commission.
Respectfully submitted,
Stanley S. DeRisio (Chair)
Ralph S. Childs, Jr.
4
<PAGE>
Audit Fees
The aggregate fees billed for professional services rendered by
Arthur Andersen LLP for the audit of our financial statements for the year ended
December 31, 2001, and the reviews of the condensed financial statements
included in our Quarterly Reports on Form 10-Q for the year ended December 31,
2001, were $100,000. In addition, Arthur Andersen LLP rendered services for the
audit of The Washington Business Park financial statements for the Company's
form 8-K filing. The fee for this service was $35,000.
Financial Information Systems Design and Implementation Fees
The aggregate fees billed for information technology services
rendered by Arthur Andersen LLP during the year ended December 31, 2001, were
$0.
All Other Fees
The aggregate fees billed for all non-audit services, exclusive of
the fees disclosed above relating to information technology services but
including fees for tax-related services, rendered by Arthur Andersen LLP during
the year ended December 31, 2001, were $0.
Executive Compensation
There is shown below information concerning the annual and
long-term compensation for services in all capacities to the Company for the
fiscal year ended December 31, 2001, 2000 and 1999 for those persons who were,
during 2001 (i) the Chief Executive Officer; and (ii) the other four most highly
compensated executive officers of the Company whose annual compensation in 2001
exceeded $100,000:
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
--------------------------------------------------------------------------------------------------
Name and Principal Year Annual Bonus ($) Long-Term All Other
Position Compensation Compensation Compensation
Salary ($) restricted Stock /1//
Award($)
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Charles S. Bresler 2001 $ 225,000 $ 25,000 $ 0 $ 385
Chief Executive 2000 225,000 25,000 0 363
Officer and Chairman 1999 213,000 25,000 0 495
of the Board of
Directors
--------------------------------------------------------------------------------------------------
Burton J. Reiner 2001 225,000 25,000 0 363
President and Director 2000 225,000 25,000 0 495
1999 213,000 25,000 0 491
--------------------------------------------------------------------------------------------------
Sidney M. Bresler 2001 128,800 5,000 0 912
Chief Operating 2000 119,600 5,000 0 798
Officer 1999 112,300 5,000 0 762
--------------------------------------------------------------------------------------------------
William L. Oshinsky 2001 128,800 5,000 0 912
Treasurer and 2000 115,000 5,000 0 798
Director 1999 112,300 5,000 0 762
--------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C>
--------------------------------------------------------------------------------------------------
Edwin Horowitz 2001 128,500 0 0 0
Formerly Secretary 2000 124,700 0 0 363
and Director 1999 128,500 0 0 535
--------------------------------------------------------------------------------------------------
</TABLE>
/1// Amounts shown for "All Other Compensation" consist of premiums paid
by the Company for life insurance.
Each director of the Company, other than Charles S. Bresler, Burton
J. Reiner and William L. Oshinsky, was paid an annual fee of $3,500 and a fee of
$500 per meeting attended during 2001.
In addition, the Company contributed to its retirement plan on
behalf of each executive officer of the Company named in the Summary
Compensation Table above for 2001, except for Charles S. Bresler, Burton J.
Reiner and Edwin Horowitz. In addition, the Company contributed to its
retirement plan on behalf of Ms. Jean S. Cafardi for 1999, 2000 and 2001. The
Company contributes to its retirement plan as required under the terms of the
plan and ERISA. Under the plan, benefits are determined for all employees on an
actuarial basis related to the individual employee's compensation, age, and
length of service, including service with predecessors of the Company. All
compensation, up to a maximum of $200,000, including salaries, fees and bonuses,
but excluding discretionary bonuses, are included as remuneration (or "covered
compensation") under the Company's retirement plan. The plan provides for
contributions by the Company designed to produce, commencing at retirement at
age 65, an annual pension calculated by multiplying the participant's number of
years of service to a maximum of 35 of such years, by the sum of 1.12% of a
participant's average annual covered compensation paid for the highest
consecutive five years prior to retirement, up to $80,400 (or less, depending
upon participant's age), plus 1.77% of the participant's average annual covered
compensation paid for such period in excess of this dollar amount, but not in
excess of a total of $140,000 for the year 2001. The approximate annual
retirement benefits payable to participating employees in specified remuneration
and years-of-service classifications is shown in the table below. The benefit
amounts listed in the following table are not subject to any deduction for
social security benefits or other offset amounts.
PENSION PLAN TABLE
Average Annual
Covered Compensation
For Highest
Consecutive Five Years Years of Service
---------------------- ----------------
10 15 20 25 30 35
-- -- -- -- -- --
$100,000 $12,474 $18,711 $24,948 $31,185 $37,422 $43,659
$110,000 14,244 21,366 28,488 35,610 42,732 49,854
$120,000 16,014 24,021 32,028 40,035 48,042 56,049
$130,000 17,784 26,676 35,568 44,460 53,352 62,244
$140,000 19,554 29,331 39,108 48,855 58,662 68,439
$150,000 21,324 31,986 42,648 53,310 63,972 74,634
$160,000 23,094 34,641 46,188 57,735 69,282 80,829
$170,000 24,864 37,296 49,728 62,160 74,592 87,024
$180,000 26,634 39,951 53,268 66,585 79,902 93,219
6
<PAGE>
$190,000 28,404 42,606 56,808 71,010 85,212 99,414
$200,000 30,174 45,261 60,348 75,435 90,522 105,609
and over (1)
(1) Under present IRS limitations, compensation in excess of $200,000
can not be included for benefit computation purposes.
At December 31, 2001, William L. Oshinsky and Jean S. Cafardi each
had 34 years of credited service and Sidney M. Bresler had 15 years of credited
service under the plan. Charles S. Bresler, Burton J. Reiner and Edwin Horowitz
were covered by the plan until December 31, 1995, and had, respectively, 34, 34
and 31 years of credited service under the plan.
Report on Executive Compensation/1//
Messrs. DeRisio and Childs, since March 1995, served as members of
the Compensation Committee of the Board during 2001. The Compensation Committee
held no meetings during 2001. The Committee may make recommendations to the
Board on compensation actions, involving executive officers of the Company.
Since the Committee has not been active, and compensation decisions have been
made by the Board of Directors, the Board of Directors has furnished the
following report on executive compensation.
The Board has determined the compensation levels of executive
officers, including the compensation of Charles S. Bresler as Chief Executive
Officer, by reviewing each executive officer's short-term and long-term
performance with the Company, the level of profitability of the Company, the
profitability of companies comparable to the Company, and the levels of
compensation of executive officers in such other companies. The executive
officers of the Company are compensated through base salaries and annual
bonuses.
As of January 1, 2002, Mr. Oshinsky's and Mr. Sidney M. Bresler's
annual salary was increased by $3,800.
Performance Graph/1//
The graph below compares the cumulative total shareholder return on
the common stock of the Company with the cumulative total return on the S & P
500 Stock Index and the S & P Homebuilding Index for the same period, assuming
the investment of $100 in the Company's common stock, the S & P 500 Index and
the S & P Homebuilding Index on December 31, 1996, and the reinvestment of
dividends.
_________________________
/1// Pursuant to the Proxy Rules, this section of the Proxy Statement is
not deemed "filed" with the Securities and Exchange Commission and is not
incorporated by reference into the Company's Report on Form 10-K.
7
<PAGE>
FIVE YEAR STOCK PERFORMANCE GRAPH: 1996 TO 2001
Comparison of Five Year Cumulative Total Return Among
Bresler & Reiner, the Homebuilding S&P and the S&P 500
<TABLE>
<CAPTION>
1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Bresler & Reiner $100.00 $197.05 $281.55 $256.00 $272.95 $427.14
Homebuilding S & P $100.00 $202.40 $211.75 $155.75 $249.63 $199.94
S & P 500 $100.00 $211.30 $267.65 $319.91 $287.47 $249.98
</TABLE>
Assumes $100.00 invested on December 31, 1995 in Bresler & Reiner Common
Stock, the Homebuilding S&P and the S&P 500. Total Return assumes reinvestment
of dividends.
Certain Transactions and Compensation Committee Interlocks and Insider
Participation
Charles S. Bresler, Burton J. Reiner and William L. Oshinsky held the
positions with the Company which are listed under "Election of Directors" above.
Sidney M. Bresler became Chief Operating Officer of the Company on June 15, 2000
and prior thereto was an employee of the Company.
Trilon Project
--------------
Prior to 1975, the Company, through its subsidiaries, acted as general
contractor in the construction for Trilon Plaza Company ("Trilon") of a high
rise office building, a portion of an enclosed mall shopping center, and three
nearby apartment buildings and 20 townhouses ("Trilon Project") in the Southwest
Washington, D.C. Urban Renewal Area.
A corporation wholly owned by Charles S. Bresler and Burton J. Reiner is
the general partner of Trilon and they are also limited partners in Trilon.
Their interests and the interests of affiliated persons, who are among the
limited partners of Trilon, are shown in the following table.
8
<PAGE>
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------
Name Relation to % Interest % Interest in
Company In Trilon/1/2// Trilon Office
Building Only
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Charles S. Bresler Officer, director 43.55 5.75
and principal
stockholder
-----------------------------------------------------------------------------------------------------
Burton J. Reiner Officer, director 43.55 2.75
and principal
stockholder
-----------------------------------------------------------------------------------------------------
T-P Partners, Inc. Owned by Charles S. 2.00 ----
Bresler and Burton J.
Reiner
-----------------------------------------------------------------------------------------------------
Edwin Horowitz Deceased - formerly ----- 2.00
officer and director
-----------------------------------------------------------------------------------------------------
William L. Oshinsky Officer and ----- 0.50
Director
-----------------------------------------------------------------------------------------------------
Anita O. Reiner Principal ----- 2.25
Stockholder and spouse of
Burton J. Reiner
-----------------------------------------------------------------------------------------------------
Children of Burton Principal ----- 5.50
J. and Anita O. Stockholder
Reiner/3//
-----------------------------------------------------------------------------------------------------
----------- Other relatives of ----- 4.75
Burton J. Reiner
(3 individuals)
-----------------------------------------------------------------------------------------------------
----------- Relatives of Charles ----- 2.00
S. Bresler
(2 individuals)
-----------------------------------------------------------------------------------------------------
</TABLE>
/1// Subject to an aggregate 61.125% interest held by others, including
those shown in the last column above, in the Trilon Office building only.
/2// Includes interests held through a limited partnership.
/3// Four individuals, who are also trustees of The Burton and Anita Reiner
Charitable Remainder Annuity Trust, a principal shareholder.
Through June 30, 2000, the Company's subsidiary acted as managing and
leasing agent for the Trilon Project and, subsequent thereto, continues to act
as managing and leasing agent for the Trilon apartment buildings and townhouses.
The subsidiary earns management fees of from 3% to 5% of the rents collected
under agreements expiring December, 2005 and December, 2003, and leasing fees of
5% of rents collected under the G.S.A. Lease. In 2001, the Company earned
$286,493 in management fees from Trilon. See discussion of Waterside
Consolidation below.
In the normal course of its management of the Trilon Project, the
Company's subsidiary collects and remits rent to Trilon, and pays expenses for
Trilon's account and is reimbursed by Trilon. The highest amount Trilon owed the
Company since January 1, 2001 was
9
<PAGE>
$392,707 at June 30, 2001. As of February 28, 2002, the Company's subsidiary
held approximately $159,408 in Trilon net rent revenues.
Waterside Complex
-----------------
The Company has constructed, principally for its own account, a portion of
an enclosed mall shopping center (contiguous to Trilon's portion of the shopping
mall and high rise office building) in the Southwest Washington, D.C. Urban
Renewal Area (see "Trilon Project" above). On July 1, 2000, this property was
assigned to a new Limited Liability Company, B&R Waterfront Properties, LLC
("BRW"). See discussion of Waterside Consolidation below. Adjacent to the
Company's shopping mall is another high rise office building, which prior to
July 1, 2000, was owned by Town Center East Investors ("TCELP"), a limited
partnership in which the Company is a general partner, with a 49% interest.
Certain affiliated persons also own interests in TCELP, all as limited partners,
as shown in the following table:
%Interest
Name Relation to Company in Town Center
---- ------------------- --------------
Charles S. Bresler Officer, director and principal 1.35
stockholder
Burton J. Reiner Officer, director and principal 0.45
stockholder
Edwin Horowitz Deceased -formerly officer and 1.35
director
William L. Oshinsky Officer and director 1.35
Anita O. Reiner Principal stockholder and spouse 0.45
of Burton J. Reiner
------ Other relatives of Burton J. Reiner 2.70
(3 individuals)
------ Relatives of Charles S. Bresler 2.70
(3 individuals)
The two portions of the shopping mall and the two office buildings are
operated as one integrated complex, known as Waterside. Each office building has
access to the mall, and an underground parking garage which serves the entire
project.
Through June 30, 2000, the Company acted as managing and leasing agent for
TCELP'S office building and earned management fees of 3% of rents collected
under an agreement expiring in December, 2003, and leasing fees of 5% of rents
collected. In 2001, the Company earned $9,635 in management fees and $257,765 in
leasing fees from TCELP. The
10
<PAGE>
Company, through June 30, 2000, collected rent revenues for TCELP and paid
expenses for TCELP'S account for which it was reimbursed. At February 28, 2002,
the Company owes TCELP $61,783.
The two high rise office buildings and parts of the lower level and the
first floor and the entire second and third floor of the shopping center and the
lower floor of a smaller structure are leased to the United States General
Services Administration ("G.S.A. Lease").
S.E.W. Investors
----------------
In October 1980, the Company assigned its leasehold interest in 105,000
square feet ("Southeast Section") of its part of the Waterside Complex to S.E.W.
Investors, a limited partnership organized by the Company to acquire the
Southeast Section. The Company took back a wrap around note from the limited
partnership in the principal amount of $9,300,000 accruing interest at 12% per
annum due on October 10, 1995. On October 10, 1995, the term of the note was
extended to October 9, 2000 and the interest rate was reduced to 10%. The
balance of this note was paid in full on June 30, 2000. The Company is the sole
general partner, with a 1% interest. Of the limited partnership interests, 62%
is held by non-affiliated persons and the remaining 37% was acquired by the
following directors and officers of the Company: 18% each by Charles S. Bresler
and Burton J. Reiner; and 1% by the Estate of Edwin Horowitz, a deceased former
director and officer. See discussion of Waterside Consolidation below.
Through June 30, 2000, the Company acted as leasing and managing agent for
S.E.W. Investors for a fee of 3% of rents collected under an agreement expiring
in December, 2000, and leasing fees of 5% of rents collected on the G.S.A.
Lease. The Company earned management fees of $7,418 and leasing fees of $114,861
in 2001 from S.E.W. Investors. The Company, through June 30, 2000, collected
rent revenues for S.E.W. Investors and paid expenses for S.E.W. Investors'
account for which it was reimbursed. There is no rental revenue nor expense
advances due either party.
Waterside Consolidation
-----------------------
Effective July 1, 2000, TCELP and S.E.W. Investors assigned the Waterside
Complex leasehold interests to the Company. The Company then transferred these
leasehold interests along with its own interest in the Waterside Complex to BRW
in exchange for a 54% membership interest in this limited liability company.
Simultaneously, Trilon transferred its leasehold interests in the Waterside
Complex to BRW in exchange for a 46% membership interest. See the Company's 2000
Annual Report for further information concerning these transactions. The
Company's subsidiary continues to act as the managing and leasing agent for BRW
on the same terms as noted above. In 2001, the Company earned management fees of
$746,784 and leasing fees of $682,140 from BRW. For financial reporting
purposes, these fees were eliminated in the consolidated financial statements.
Third Street Southwest Investors
--------------------------------
In 1979, the Company sold apartment buildings adjacent to the Waterside
Complex to Third Street Southwest Investors, a limited partnership organized by
the Company and took back a wrap around note from the limited partnership in the
principal amount of
11
<PAGE>
$4,350,000, accruing interest at 9.5% per annum due on July 31, 1994. On August
1, 1994, the term of the note was extended to July 31, 1999 and on August 1,
1999, the term of the note was extended to July 31, 2004. At December 31, 2001,
the balance due the Company under this note was $2,351,000. The Company is its
sole general partner, with a 1% interest. Of the limited partnership interests,
90% are held by unaffiliated persons, and the remaining 9% were acquired by the
following directors and officers of the Company: Charles S. Bresler 7% and
Burton J. Reiner 1% and 1% by Edwin Horowitz, a retired former director and
officer. Each limited partner in Third Street Southwest Investors contributed
approximately $10,000 per 1% interest.
A subsidiary of the Company acts as managing agent for Third Street
Southwest Investors for a management fee of 5% of rents collected under an
agreement expiring in September, 2004. During 2001, the Company earned
management fees of $104,185 from Third Street Southwest Investors under this
agreement. The Company as agent collects rent revenues for Third Street
Southwest Investors and pays expenses for Third Street Southwest Investors'
account for which it is to be reimbursed. The highest amount owed the Company
since January 1, 2002 was $2,090,354 at February 28, 2002.
Holiday Inn Express
-------------------
The Company owns and operates a 151-room Holiday Inn Express motel in Camp
Springs, Maryland. Record title to the real estate on which the motel is
situated is held by Charles S. Bresler and Burton J. Reiner, who have agreed to
act, without compensation, as nominee title holders for the Company. This
arrangement has been approved by the other directors of the Company.
Builders Leasing Company
------------------------
In December 1983, the Company and others organized Builders Leasing
Company, a general partnership, to engage in equipment leasing. The Company has
a 20% interest and acts as the managing general partner. The partners have
contributed $3,150,000 to the capital of the partnership in proportion to their
percentage interests, the Company's share of which was $630,000. Charles S.
Bresler and Burton J. Reiner, directors and officers of the Company hold
interests of 20% and 5%, respectively, as general partners. Edwin Horowitz, a
retired former director and officer of the Company, holds a 2% interest as a
general partner.
Paradise Sudley North Office Building D
---------------------------------------
The Company is a 10% general partner and an 88.75% limited partner in
Paradise Sudley North Limited Partnership which is in turn a 50% general partner
in Paradise Sudley North Building D Partnership ("Building D Partnership").
Building D Partnership owns a 69,374 square foot office building in Manassas,
Virginia, which has been 100% leased to the Prince William County government
since the completion of the building in 1989. During 1998, this lease was
renewed for a period of 10 years. Since inception, two unaffiliated persons each
owned a 25% interest in Building D Partnership. In 1998 these interests were
sold to The Bresler Family Investors LLC. Charles S. Bresler, CEO of the
Company, is the manager of this limited liability company. In March 2002,
Building D Partnership transferred title to the property to a new Limited
Liability Company owned by Building D Partnership. This new LLC, along with two
other LLC's owned primarily by the Company, placed an $18,010,000 deed of trust
loan
12
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secured by four of the office buildings and the Bank Building in Manassas,
Virginia. The Building D Partnership's share of this loan is $6,388,561. This
partnership used $6,000,000 of the loan proceeds to pay off the existing
mortgage to the Company. This existing mortgage had a face value, prior to the
pay off, of $6,952,638 and was carried on the Company's books at that date of
$5,974,773. This difference resulted from the fact that the Company purchased
this note from an unaffiliated third party institutional lender at a discount of
$977,865.
Sarnia Corporation
------------------
In October, 2001, the Company entered into an agreement to
acquire two office buildings located in Springfield, Fairfax County, Virginia
containing approximately 218,833 square feet of office space. The purchase price
was $20,000,000 subject to certain post closing adjustments. This acquisition
was completed on January 31, 2002. At closing, the Company placed a $15,000,000
deed of trust note with Trilon Plaza Company. The note bears interest at 7.26%
per annum, amortized over 30 years which results in a monthly payment of
principal and interest of $103,428. The note has a term of 10 years, but
maturity may be accelerated by Trilon giving one year advance notice to the
Company. Such notice cannot be given during the first six months. The Company
may prepay the note in whole or in part at any time without penalty or premium.
The Company paid to Trilon a loan commitment fee of $102,000.
-------------------------
Management considers its contracts and other business relationships with
each of these affiliates to be as favorable to the Company as those obtainable
with outsiders.
Financial Statements
For certain information concerning the Company and its subsidiaries see the
financial statements and report of Arthur Andersen LLP, independent certified
public accountants, included in the Annual Report accompanying this proxy
statement. Such report is not incorporated in this proxy statement and is not
deemed to be a part of the proxy soliciting material. Representatives of Arthur
Andersen LLP are not expected to be present at the meeting.
Cost of Solicitation
The cost of solicitation of proxies from stockholders will be borne by the
Company. In addition to the use of mails, proxies may be solicited by telephone
by officers, directors and a small number of employees of the Company who will
not be specially compensated for such services. The Company may reimburse
persons holding such stock of record only, such as brokerage houses, for their
expenses in forwarding soliciting material to the beneficial owner of such
stock.
Other Matters
The Board of Directors is not aware of any matters not set forth herein
which may come before the meeting. If, however, any such matter properly comes
before the meeting, the persons named in the proxies will vote the shares
represented thereby in accordance with their judgment.
13
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Deadline for Filing Shareholder Proposals for 2003 Annual Meeting.
The date by which proposals of shareholders intended to be presented at the
2003 Annual Meeting must be received by the Company for inclusion in the
Company's 2003 Proxy Statement and Proxy relating to that meeting is December
19, 2002.
By Order of the Board of
Directors
Jean S. Cafardi, Secretary
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BRESLER & REINER, INC.
This Proxy Is Being Solicited By The Board of Directors
Annual Meeting of Stockholders, June 20, 2002
The undersigned hereby appoints Sidney Bresler and Randall Reiner, and each of
them, Proxies for the undersigned with power of substitution, to vote as
designated below all the shares of the undersigned at the Annual Meeting of
Stockholders of Bresler & Reiner, Inc., to be held at the offices of the
Company, the Waterside Mall, 401 M Street, S. W., Washington, DC on June 20,
2002 at 10:00 a.m., or any adjournment thereof, all as more fully described in
the Notice of Meeting and Proxy Statement, receipt of which is hereby
acknowledged.
1. Election of The Following Nominees as Directors:
C.S. Bresler; R.S. Childs, Jr.; S.S. DeRisio; G.W. Huguely, III; W.L.
Oshinsky; B.J. Reiner
[_] FOR ALL NOMINEES [_] WITHHOLD AUTHORITY [_] FOR ALL NOMINEES
TO VOTE FOR ALL EXCEPT AS INDICATED
NOMINEES BELOW
------------------------
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
(Please see other side)
<PAGE>
Receipt of the Annual Report of the Company for the year 2001 is hereby
acknowledged.
The undersigned revokes all proxies heretofore given with respect to said
meeting and approves all that the Proxies or their substitutions shall do by
virtue hereof.
This Proxy, when properly executed, will be voted as directed herein, but if
no direction is given, this proxy will be voted For All Nominees.
Dated:____________________, 2002 ______________________________
Stockholder
(Please sign exactly as your name
appears hereon. Executors,
administrators or trustees should so
indicate when signing.)
PLEASE DATE, SIGN AND RETURN THIS PROXY PROMPTLY
</TEXT>
</DOCUMENT>