<PAGE>
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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 the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
PIMCO Commercial Mortgage Securities Trust, Inc.
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(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:
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[LOGO of PIMCO]
PIMCO COMMERCIAL MORTGAGE SECURITIES TRUST, INC.
840 NEWPORT CENTER DRIVE
NEWPORT BEACH, CALIFORNIA 92660
(800) 927-4648
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
APRIL 14, 1997
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of PIMCO
Commercial Mortgage Securities Trust, Inc. (the "Fund") will be held at the
offices of Pacific Investment Management Company ("PIMCO"), 840 Newport Center
Drive, Newport Beach, California 92660, on April 14, 1997 at 2:00 p.m.,
Pacific time, or at such adjourned time as may be necessary for the holders of
a majority of the outstanding shares of the Fund to vote (the "Meeting"), for
the following purposes:
(1) To elect a member to the Board of Directors of the Fund to hold
office for the term specified and until his successor is elected and
qualifies;
(2) To ratify the selection of Ernst & Young LLP as independent public
accountants of the Fund for its fiscal year ending December 31, 1997; and
(3) To transact such other business as may properly come before the
Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on March 10, 1997 as
the record date for the determination of shareholders entitled to notice of,
and to vote at, the Meeting or any adjournment thereof, and only holders of
record of shares at the close of business on that date are entitled to notice
of, and to vote at, the Meeting.
You are cordially invited to attend the Meeting. All shareholders are
requested to complete, date and sign the enclosed form of proxy and return it
promptly in the envelope provided for that purpose. The enclosed proxy is
being solicited on behalf of the Board of Directors of the Fund.
By Order of the Board of Directors,
Garlin G. Flynn
Secretary
Newport Beach, California
Dated: March 17, 1997
PLEASE RESPOND--YOUR VOTE IS IMPORTANT. WHETHER OR NOT YOU PLAN TO ATTEND
THE MEETING, PLEASE COMPLETE, SIGN AND MAIL THE PROXY IN THE MANNER PROVIDED.
IT IS IMPORTANT THAT YOU RETURN YOUR PROXY AS SOON AS POSSIBLE TO ASSURE THAT
YOUR PROXY WILL BE VOTED AND TO AVOID ANY ADDITIONAL EXPENSE TO THE FUND OF
FURTHER SOLICITATION.
<PAGE>
PROXY STATEMENT
PIMCO COMMERCIAL MORTGAGE SECURITIES TRUST, INC.
840 NEWPORT CENTER DRIVE
NEWPORT BEACH, CALIFORNIA 92660
(800) 927-4648
----------------
ANNUAL MEETING OF SHAREHOLDERS
APRIL 14, 1997
----------------
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of PIMCO Commercial Mortgage
Securities Trust, Inc. (the "Fund"), a Maryland corporation, to be voted at
the Annual Meeting of Shareholders of the Fund to be held at 840 Newport
Center Drive, Newport Beach, California 92660, on April 14, 1997 at 2:00 p.m.,
Pacific time, and at any adjournment thereof (the "Meeting"). The approximate
mailing date of this Proxy Statement is March 17, 1997. The Fund's Annual
Report for the year ended December 31, 1996, including audited financial
statements, previously has been sent to shareholders, and is available upon
request to the Fund without charge by calling the toll-free number referenced
above.
All properly executed proxies received prior to the Meeting will be voted at
the Meeting in accordance with the instructions marked thereon or otherwise as
provided therein. Unless instructions to the contrary are marked, proxies will
be voted in favor of Proposals 1 and 2. Any proxy may be revoked at any time
prior to the exercise thereof by giving written notice to the Secretary of the
Fund.
In the event that a quorum is present at the Meeting but sufficient votes to
approve any of the proposals are not received, the proxy holders may propose
one or more adjournments of the Meeting to permit further solicitation of
proxies. Any such adjournment will require the affirmative vote of a majority
of those shares represented at the Meeting in person or by proxy. If a quorum
is present, the proxy holders will vote proxies which they are entitled to
vote FOR any proposal in favor of such an adjournment, and will vote those
proxies required to be voted AGAINST any proposal against adjournment. A
shareholder vote may be taken on one or more of the proposals in this Proxy
Statement prior to any adjournment if sufficient votes have been received for
approval.
<PAGE>
The Board of Directors has fixed the close of business on March 10, 1997 as
the record date for the determination of shareholders entitled to notice of
and to vote at the Meeting (the "Record Date"). Shareholders on the Record
Date will be entitled to one vote for each share held. As of the Record Date,
the Fund had outstanding 11,007,169 shares of common stock, par value $.001
per share.
PROPOSAL 1: ELECTION OF DIRECTOR
The Fund's Articles of Incorporation provide that the Fund's Board of
Directors shall be divided into three classes, as nearly equal in number as
possible, which shall be designated as Class I, Class II and Class III. The
initial term of the Class III Director expires this year. The current terms of
the Class I and Class II Directors will expire in 1998 and 1999, respectively,
when their respective successors are elected and qualify. The effect of these
staggered terms is to limit the ability of other entities or persons to
acquire control of the Fund by delaying for up to two years the replacement of
a majority of the Board of Directors. Brent R. Harris, Class III Director, has
been nominated for re-election by the Board of Directors to serve another
term, which would expire in 2000.
Mr. Harris (the "Nominee") has indicated an intention to serve if elected
and has consented to be named in this Proxy Statement.
It is the intention of the persons named in the enclosed proxy to vote in
favor of the election of the Nominee. The Board of Directors of the Fund knows
of no reason why the Nominee will be unable to serve, but in the event of any
such unavailability, the proxies received will be voted for such substituted
nominee as the Board of Directors may recommend. The Board of Directors
recommends that shareholders vote FOR the election of the Nominee to the
Fund's Board of Directors.
2
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The following table sets forth certain information concerning each of the
Directors of the Fund; however, only the Nominee is standing for election.
The Class I Directors are:
CLASS I (TERM EXPIRING IN 1998):
<TABLE>
<CAPTION>
SHARES OF COMMON
STOCK BENEFICIALLY
OWNED AND % OF
PRINCIPAL OCCUPATION POSITION(S) WITH TOTAL OUTSTANDING
NAME, ADDRESS AND AGE AND OTHER DIRECTORSHIPS THE FUND AT 3/10/97(1)
- --------------------- ---------------------------- --------------------- ------------------
<C> <S> <C> <C>
Guilford C. Babcock Associate Professor of Director (since 7/93) -0-
Marshall School of Finance, University of
Business Southern California (1968-
University of present); Trustee, PIMCO
Southern Funds (1987-present);
California Director, AMCAP Fund (1980-
Los Angeles, CA present) and Fundamental
90089-1421 Investors Fund (1991-present)
Age: 65 of the Capital Group; and
Director, Good Hope Medical
Foundation (1980-present).
William J. Popejoy Chairman, Pac Pro (formerly Director (since 8/95, -0-
207 Chatham Court Western Printing) (1995- and 7/93-2/95)
Newport Beach, CA present); Partner, Butler
92660 Popejoy Group (1992-
Age: 58 present); Trustee, PIMCO
Funds (July 1993-February
1995 and August 1995-
present); formerly Chief
Executive Officer, Orange
County, California (February
1995-August 1995);
and Principal, Castine
Partners (1989-1992).
</TABLE>
3
<PAGE>
The Class II Directors are:
CLASS II (TERM EXPIRING IN 1999):
<TABLE>
<CAPTION>
SHARES OF COMMON
STOCK BENEFICIALLY
OWNED AND % OF
PRINCIPAL OCCUPATION POSITION(S) WITH TOTAL OUTSTANDING
NAME, ADDRESS AND AGE AND OTHER DIRECTORSHIPS THE FUND AT 3/10/97(1)
- --------------------- ---------------------------- --------------------- ------------------
<S> <C> <C> <C>
Thomas P. Kemp Co-Chairman, U.S. Committee Director (since 7/93) -0-
359 San Miguel, to Assist Russian Reform
Suite 110 (1992-present); Trustee,
Newport Beach, CA PIMCO Funds (1987-present);
92660-7807 formerly Director, Union
Age: 66 Financial Corp. (1991-1995);
and Senior Consultant,
World Cup 1994 Organizing
Committee (1990-1994).
Vern O. Curtis Private Investor (1990- Director (since 2/95) 7,500
14158 N.W. Bronson present); Trustee, PIMCO (0.07%)
Creek Drive Funds (April 1987-February
Portland, OR 1993 and February 1995-
97229 present); Director of 8 Real
Age: 62 Estate Investment Trusts
affiliated with Public
Storage, Inc.; Director,
Fresh Choice, Inc. (1996-
present); formerly
Charitable Work, The Church
of Jesus Christ of Latter
Day Saints (1992-1995).
</TABLE>
4
<PAGE>
The Class III Director (Nominee) is:
CLASS III (TERM EXPIRING IN 2000):
<TABLE>
<CAPTION>
SHARES OF COMMON
STOCK BENEFICIALLY
OWNED AND % OF
PRINCIPAL OCCUPATION POSITION(S) WITH TOTAL OUTSTANDING
NAME, ADDRESS AND AGE AND OTHER DIRECTORSHIPS THE FUND AT 3/10/97(1)
- --------------------- ---------------------------- --------------------- ------------------
<S> <C> <C> <C>
Brent R. Harris* Managing Director, PIMCO Chairman of the Board 15,000
840 Newport Center (1993-present); Director, and Director (since (0.14%)
Drive, Suite 360 Harris Holdings (1992- 6/93)
Newport Beach, CA present); Director, Harris
92660 Oil Company (1992-present);
Age: 37 Chairman of the Board and
Trustee, PIMCO Funds (1992-
present); formerly
Principal, Senior Vice
President and Vice President
of PIMCO (1985-1993).
</TABLE>
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(1) All shares listed in this table are owned with sole voting and investment
power, and in the aggregate represent 0.2% of the total shares outstanding
of common stock as of the Record Date. The Fund's Directors and executive
officers in the aggregate beneficially own less than 1% of the Fund's
common stock.
* "Interested person" as defined in the Investment Company Act of 1940
("interested Director"). Mr. Harris is deemed to be an interested Director
by reason of his affiliations with PIMCO.
The Fund has a standing Audit Committee, which reviews the scope of the
annual audit conducted by the Fund's independent auditors, the evaluation by
such accountants of the accounting procedures followed by the Fund, and
compliance by the Fund with regulations of the Securities and Exchange
Commission and the Internal Revenue Service, as well as related matters. The
Fund's Audit Committee currently is composed of Messrs. Babcock, Curtis, Kemp
and Popejoy. During the Fund's fiscal year ended December 31, 1996, the Board
of Directors held five meetings (one of which was conducted telephonically),
and the Audit Committee held one meeting. The Fund has no nominating committee
or other committees. Each Director attended at least 75% of the total number
of meetings of the Board and the Committee of which he was a member.
5
<PAGE>
The following table provides information concerning the compensation of each
of the incumbent Directors who are not interested Directors of the Fund for
services rendered to the Fund during the year ended December 31, 1996.
<TABLE>
<CAPTION>
TOTAL COMPENSATION
FROM
AGGREGATE FUND AND FUND
COMPENSATION COMPLEX(2)
NAME FROM FUND(1) PAID TO DIRECTORS
---- ------------ ------------------
<S> <C> <C>
Guilford C. Babcock............................ $10,000 $40,000
Vern O. Curtis................................. $10,000 $40,000
Thomas P. Kemp................................. $10,000 $40,000
William J. Popejoy............................. $10,000 $40,000
</TABLE>
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(1) During the fiscal year ended December 31, 1996, the Fund paid each
unaffiliated Director an annual retainer of $6,000 and $1,000 for each
regular Board of Directors meeting attended. At a meeting of the Board of
Directors held on February 25, 1997, the Directors approved an additional
annual retainer of $500 for the chairman of any committee of the Board,
and determined that, effective May 1, 1997, the per meeting fee be set at
$1,000 for each regularly scheduled meeting attended in person, and $500
for each such meeting attended telephonically. The Fund may reimburse
Directors for out-of-pocket expenses relating to attendance at meetings.
The aggregate amount of fees paid and expenses reimbursed to the
unaffiliated Directors for the fiscal year ended December 31, 1996 was
$40,000.
(2) The Directors also serve as Trustees of the PIMCO Funds, a registered,
open-end management investment company. For their services, Messrs.
Babcock, Curtis, Kemp and Popejoy, the Trustees who are unaffiliated with
PIMCO or its affiliates, receive an annual retainer of $20,000 plus $2,500
for each Board of Trustees meeting attended, plus reimbursement of related
expenses. At a meeting of the Board of Trustees held on February 25, 1997,
the Trustees approved an increase of the annual retainer paid to each
unaffiliated Trustee to $45,000. In addition, effective May 1, 1997, the
Board of Trustees approved an annual retainer of $1,500 for the chairman
of any committee of the Board, and determined that the per meeting fee be
set at $3,000 for each regularly scheduled meeting attended in person, and
$500 for each such meeting attended telephonically. For the fiscal year
ending March 31, 1997, the unaffiliated Trustees as a group will receive
reimbursement of such fees and expenses aggregating $120,000.
6
<PAGE>
The following table shows the executive officers of the Fund, other than
those shown above, their ages, positions with the Fund and principal
occupations during the past five years. The executive officers of the Fund are
appointed annually by the Board of Directors.
<TABLE>
<CAPTION>
POSITION WITH PRINCIPAL OCCUPATIONS
NAME AND AGE THE FUND DURING THE PAST FIVE YEARS
------------ ------------- --------------------------
<C> <C> <S>
R. Wesley Burns President Executive Vice President, PIMCO;
Age 37 (Since 6/93) formerly Vice President, PIMCO.
William C. Powers Senior Vice President Managing Director, PIMCO; formerly
Age 39 (Since 7/93) Executive Vice President, PIMCO.
Benjamin L. Trosky Senior Vice President Managing Director, PIMCO; formerly
Age 37 (Since 7/93) Executive Vice President, PIMCO.
Dean S. Meiling Vice President Managing Director, PIMCO.
Age 48 (Since 7/93)
William F. Podlich Vice President Managing Director, PIMCO.
Age 52 (Since 7/93)
Jeffrey M. Sargent Vice President, Vice President and Manager of Fund
Age 34 formerly Secretary Shareholder Servicing, PIMCO;
(Since 6/93) formerly Project Specialist, PIMCO.
William S. Thompson Vice President Chief Executive Officer and Managing
Age 51 (Since 7/93) Director, PIMCO; formerly Managing
Director, Salomon Brothers, Inc.
Teresa A. Wagner Vice President Vice President and Manager of Fund
Age 34 (Since 8/95) Administration, PIMCO; formerly Vice
President, PIMCO Advisors
Institutional Services; and formerly
Finance Director, Pacific Financial
Asset Management Corporation.
John P. Hardaway Treasurer Vice President and Manager of Fund
Age 39 (Since 6/93) Operations, PIMCO.
Garlin G. Flynn Secretary Senior Fund Administrator, PIMCO;
Age 50 (Since 8/95) formerly Senior Mutual Fund Analyst,
PIMCO Advisors Institutional
Services; and formerly Senior Mutual
Fund Analyst, Pacific Financial
Asset Management Corporation.
Joseph D. Hattesohl Assistant Treasurer Vice President and Manager of Fund
Age 33 (Since 2/95) Taxation, PIMCO; formerly Director
of Financial Reporting, Carl I.
Brown & Co.; and formerly Tax
Manager, Price Waterhouse LLP.
Michael J. Willemsen Assistant Secretary Shareholder Support Manager, PIMCO;
Age 37 (Since 2/95) formerly Shareholder Services
Specialist, PIMCO.
</TABLE>
7
<PAGE>
INVESTMENT MANAGER AND ADMINISTRATOR
PIMCO, 840 Newport Center Drive, Newport Beach, California 92660 has served
as the Fund's investment manager since August 27, 1993. PIMCO also serves as
administrator to the Fund. PIMCO is a subsidiary partnership of PIMCO Advisors
L.P. ("PIMCO Advisors"). A majority interest in PIMCO Advisors is held by
PIMCO Partners, G.P., a general partnership between Pacific Investment
Management Company, a California corporation and indirect wholly owned
subsidiary of Pacific Mutual Life Insurance Company ("Pacific Mutual"), and
PIMCO Partners LLC, a limited liability company controlled by the PIMCO
Managing Directors.
PROPOSAL 2: SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected Ernst & Young LLP as independent
auditors to examine the financial statements of the Fund for the fiscal year
ending December 31, 1997. Audit services performed by Ernst & Young LLP during
the most recent fiscal year included examination of the financial statements
of the Fund, review of filings with the Securities and Exchange Commission and
preparation of tax returns. The Fund knows of no direct or indirect interest
of such firm in the Fund. A representative of Ernst & Young LLP, if requested
by any shareholder, will be present at the Meeting and have the opportunity to
respond to questions from shareholders.
The Board of Directors recommends that shareholders vote FOR the
ratification of the selection of Ernst & Young LLP as independent auditors.
OTHER MATTERS
No business other than as set forth herein is expected to come before the
Meeting, but should any other matter requiring a vote of shareholders arise,
including any question as to an adjournment of the Meeting, the persons named
in the enclosed proxy will vote thereon according to their best judgment in
the interests of the Fund.
ADDITIONAL INFORMATION
EXPENSES
The expense of preparation, printing and mailing of the enclosed form of
proxy and accompanying Notice and Proxy Statement will be borne by the Fund.
The Fund will reimburse banks, brokers and others for their reasonable
expenses in forwarding proxy solicitation material to the beneficial owners of
the shares of the Fund. In order to obtain the necessary quorum at the
Meeting, supplementary solicitation may be made by mail, telephone, telegraph
or personal interview by officers or agents of the Fund. It is not anticipated
that the cost of such supplementary solicitation will exceed $2,000.
8
<PAGE>
QUORUM AND VOTES REQUIRED
The presence in person or by proxy of the holders of a majority of the
outstanding shares is required to constitute a quorum at the Meeting. Shares
held by shareholders present in person or represented by proxy at the Meeting
will be counted both for the purpose of determining the presence of a quorum
and for calculating the votes cast on the issues before the Meeting.
Abstentions will also be counted for quorum purposes.
Election of Director (Proposal 1) and ratification of the selection of
independent auditors (Proposal 2) will require the affirmative vote of the
holders of a majority of the Fund's shares present (or represented by proxy)
and voting at the Meeting.
Broker "non-votes" (that is, proxies from brokers or nominees indicating
that such persons have not received instructions from the beneficial owner or
other persons entitled to vote shares on a particular matter with respect to
which the brokers or nominees do not have discretionary power) will have the
same effect as abstentions in determining whether an issue has received the
requisite approval. Where the broker or nominee has no discretion to vote the
shares as to one or both proposals before the Meeting, the non-voted shares
will be excluded from the pool of shares voted on such issues. Thus,
abstentions and non-votes will not be considered votes cast and thus will have
no effect on matters requiring approval of a specified percentage of votes
cast.
If the accompanying form of proxy is executed properly and returned, shares
represented by it will be voted at the Meeting in accordance with the
instructions on the proxy. However, if no instructions are specified, shares
will be voted FOR the election of a Director and FOR the ratification of Ernst
& Young LLP as independent auditors of the Fund for the fiscal year ending
December 31, 1997.
SHAREHOLDERS' PROPOSALS
A shareholder's proposal intended to be presented at the Fund's Annual
Meeting of Shareholders in 1998 must be received by the Fund on or before
November 17, 1997, in order to be included in the Fund's proxy statement and
form of proxy relating to that meeting.
SHAREHOLDERS WHO DO NOT EXPECT TO BE PRESENT AT THE MEETING AND WHO WISH TO
HAVE THEIR SHARES VOTED ARE REQUESTED TO DATE AND SIGN THE ENCLOSED PROXY AND
RETURN IT IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE
UNITED STATES.
By Order of the Board of Directors,
Garlin G. Flynn
Secretary
Dated: March 17, 1997
9
<PAGE>
PROXY
PIMCO COMMERCIAL MORTGAGE SECURITIES TRUST, INC.
ANNUAL MEETING OF SHAREHOLDERS
April 14, 1997
The undersigned hereby appoints Teresa A. Wagner and Garlin G. Flynn,
and each of them as Proxies with full power of substitution to vote and act with
respect to all shares of the PIMCO Commercial Mortgage Securities Trust, Inc.
(the "Fund") held by the undersigned at the Annual Meeting of Shareholders of
the Fund to be held at 2:00 p.m., Pacific time, on April 14, 1997, at 840
Newport Center Drive, Newport Beach, California 92660, and at any adjournment
thereof (the "Meeting"), and instructs them to vote as indicated on the matters
referred to in the Proxy Statement for the Meeting, with discretionary power to
vote upon such other business as may properly come before the Meeting.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE FUND. The
Board of Directors recommends that you vote FOR the following proposals:
---
1. To elect the Nominee listed below to serve as a member of the Fund's
Board of Directors for the term expiring 2000, and until his successor
is elected and qualifies.
Brent R. Harris
[_] FOR [_] WITHHOLD [_] ABSTAIN
2. To ratify the selection of Ernst & Young LLP as independent public
accountants of the Fund for its fiscal year ending December 31, 1997.
[_] FOR [_] AGAINST [_] ABSTAIN
This proxy will be voted as specified. IF NO SPECIFICATION IS MADE, THIS PROXY
WILL BE VOTED FOR THE PROPOSALS. Receipt of the Notice of Annual Meeting and
---
Proxy Statement is hereby acknowledged.
PLEASE VOTE, SIGN AND DATE THIS PROXY AND RETURN IT IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
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SIGNATURE SIGNATURE (JOINT OWNERS) DATE
If as attorney, executor, guardian or in some representative capacity, or as an
officer of a corporation, please add title as such.
