Securities and Exchange Commission
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
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
[X] Definitive proxy statement Commission Only (as permitted
[ ] Definitive additional materials by Rule 14a-6(e)(2))
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
KEYCO BOND FUND, INC.
(Name of Registrant as Specified In Its Charter)
J. Darrel Barros, Esq.
(Name of Person(s) Filing Proxy Statement, if other than 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)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the amount
on which the filing fee is calculated and state how it was
determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any party of the fee is offset as provided by Exchange
Act Rule 1-11(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 of Schedule and the date
of filing.
(1) Amount Previously Paid:
(2) Form Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
KEYCO BOND FUND, INC.
27777 Franklin Road, Suite 1850
Southfield, Michigan 48034
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held December 17, 1996
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
Keyco Bond Fund, Inc., a Michigan corporation (the "Company"), will be held
at the principal executive offices of the Company, 27777 Franklin Road,
Suite 1850, Southfield, Michigan, on Tuesday, December 17, 1996, at 11:00
a.m., E.S.T., for the following purposes:
(1) To elect five directors to serve until the next Annual
Meeting of Shareholders;
(2) To consider and act upon a proposal to ratify the
appointment of Coopers & Lybrand L.L.P. as independent auditors for the year
ending September 30, 1997; and
(3) To transact such other business as may properly come before
the meeting or any adjournments thereof.
Information with respect to the above matters is set forth in the
Proxy Statement which accompanies this Notice.
The Board of Directors has fixed the close of business on November
7, 1996, as the record date for determining shareholders entitled to notice
of and to vote at the Annual Meeting.
Please execute and promptly return the enclosed proxy card (i.e.
yellow sheet). Your designation of a proxy is revocable and will not affect
your right to vote in person in the event you find it convenient to attend
the meeting.
By Order of the Board of Directors
JOEL D. TAUBER
President
Southfield, Michigan
November 22, 1996
KEYCO BOND FUND, INC.
27777 Franklin Road, Suite 1850
Southfield, Michigan 48034
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 17, 1996
This Proxy Statement and the accompanying form of proxy are to be
first mailed on or about November 22, 1996 to all shareholders of record on
November 7, 1996, and is furnished in connection with the solicitation of
proxies by the Board of Directors of Keyco Bond Fund, Inc., a Michigan
corporation (the "Company"), to be used at the Annual Meeting of
Shareholders to be held at 11:00 a.m., E.S.T., on Tuesday, December 17,
1996, and at any adjournments thereof.
Shares cannot be voted at the meeting unless the holder is present
in person or represented by proxy. Proxies are revocable by written notice
to the Secretary of the Company at any time prior to their exercise.
Proxies may also be revoked by a shareholder attending and voting in person
at the meeting. Shares of the Company's stock represented by any unrevoked
proxy in the enclosed form, if such proxy is properly executed and is
received prior to the meeting, will be voted in accordance with the
specifications made on such proxy or, if no specification has been made on
such proxy, will be voted for the election as directors of the nominees
listed herein and in favor of the proposal to ratify the selection of
auditors. The Board of Directors does not intend to present any other
matters at the Annual Meeting. However, should any other matters properly
come before the Annual Meeting, the proxy holders will have discretionary
authority to vote upon such matters and, in such event, it is the intention
of such proxy holders to vote the proxy in accordance with their best
judgment. For purposes of determining the number of votes cast with respect
to any voting matter, only those cast "for" or "against" are included.
Abstentions are counted only for purposes of determining whether a quorum is
present at the Annual Meeting. Broker non-votes are not counted for any
purpose. A majority of the outstanding shares of the Company, represented
in person or by proxy, will constitute a quorum at the meeting.
The Common Stock of the Company is the only class of securities
which is entitled to vote at the meeting. As of the close of business
November 7, 1996, the record date for determining shareholders who are
entitled to receive notice of and to vote at the meeting, there were
1,267,258 shares of Common Stock issued and outstanding. Each share is
entitled to one vote. The presence at the meeting, in person or by proxy,
of the holders of a majority of shares of stock of the Company is necessary
to constitute a quorum.
The cost of soliciting proxies, which may be conducted by mail,
telephone, in person or otherwise, will be borne by the Company. The
mailing address of the Company's principal executive offices is 27777
Franklin Road, Suite 1850, Southfield, Michigan 48034.
MATTERS TO COME BEFORE THE MEETING
(1) Election of Directors
Five directors are to be elected at the meeting. The directors of
the Company are elected annually by the shareholders, to serve until the
next annual meeting of shareholders or until their death, resignation, or
removal. The nominees named in the table below have each indicated a
willingness to serve if elected. If any nominee should be unable to serve
or is otherwise unavailable for election, and if any other persons are
nominated, the persons designated on the accompanying form of proxy will
have discretionary authority to vote or refrain from voting in accordance
with their judgment on such other nominees unless authority to vote on such
matter is withheld.
Shares of Common Stock
Beneficially Owned
---------------------
Principal Occupation Director Percent
Name and Age (Past five years Since Number of Class
- ------------ -------------------- -------- ------ --------
Gail A. Dishell, 60(1) Vice President of the 1984 469,529(2) 37.1%
Company since September
1979; Investor
Mark E. Schlussel, 56 Of Counsel to the firm 1979 -0-
of Pepper, Hamilton and
Scheetz, attorneys (since
January 1995) (Detroit,
Michigan); previously
Partner in firm of
Miller, Canfield, Paddock
and Stone, attorneys
(from October 1990 to
January 1995) (Detroit,
Michigan)
David K. Page, 63 Partner in the firm of 1989 -0-
Honigman Miller Schwartz
and Cohn, attorneys
(Detroit, Michigan)
Thomas E. Purther, 31(1) Partner in Key Homes, 1994 24,715(3) 2.0%
residential housing
builder (since December
1993)(Bingham Farms,
Michigan) and Executive
Vice President of United
Capital Financial, LLC,
residential mortgage
lender (since January
1995) (Bingham Farms,
Michigan); previously
financial analyst for
Keywell Corporation
(scrap metal) (from
September 1991 to Decem-
ber 1993) (Chicago,
Illinois)
Ellen T. Horing, 34(1) Portfolio manager of 1995 53,477(4) 4.2%
Highgate Partners, an
investment partnership
(since January 1993)
(Mt. Kisco, New York);
Previously Director of
Research and Vice Presi-
dent, Gabelli Funds, Inc.
(mutual funds) (from
August 1988 to August
1992) (Rye, New York)
____________________
(1) Ms. Dishell, Mr. Purther and Ms. Horing are "interested persons" as
defined in Section 2(a) (19) of the Investment Company Act of 1940 because
of their status as an officer, director, holder of more than 5% of the
Company's Common Stock and/or the immediate family member of any of the
foregoing.
(2) Includes certain shares pursuant to which Ms. Dishell is sole trustee.
See "Principal Shareholders." Does not include 1,000 shares held by Ms.
Dishell's husband, as to which she disclaims any beneficial ownership.
(3) These shares are held in a trust for the benefit of Mr. Purther; Ms.
Barbara J. Keywell (formerly Ms. Barbara J. Purther) serves as the sole
trustee of such trust with voting and dispositive powers. See "Principal
Shareholders."
(4) These shares are held in a trust for the benefit of Ms. Horing; Ms.
Shelby M. Tauber and Mr. Joel D. Tauber serve as co-trustees of such trust
with voting and dispositive powers. See "Principal Shareholders."
All directors and officers of the Company, as a group, beneficially
own 1,257,283 shares (99.2%) of the Company's outstanding Common Stock. See
"Principal Shareholders."
All of the nominees were previously elected as directors at the last
annual meeting of shareholders. Shelby M. Tauber, Barbara J. Keywell and
Gail A. Dishell, each of whom is an officer and/or a director and a
principal shareholder, are sisters. In addition, Mr. Thomas E. Purther is
the son of Ms. Keywell, and Ms. Horing is the daughter of Ms. Tauber. The
Board of Directors has no committees. Directors who are not "interested
persons" of the Company as defined in the Investment Company Act of 1940
(i.e., Messrs. Schlussel and Page) are presently paid a fee of $1,000 per
meeting. During the year ended September 30, 1996, the Board of Directors
met once and all directors were present. During the year ended September
30, 1996, no remuneration of any form was paid to the Company's officers or
directors, other than as described above with respect to the Company's two
outside directors.
The nominees receiving a plurality of votes cast at the meeting will
be elected directors.
(2) Ratification of Appointment of Auditors
The directors of the Company who are not "interested persons" have
unanimously appointed Coopers & Lybrand L.L.P., independent public
accountants, to audit the financial statements of the Company for the
current fiscal year ending September 30, 1997. This firm served in such
capacity for the year ended September 30, 1996, and has no direct or
indirect interest in the Company other than as its auditors and independent
accountants. This appointment will be submitted to shareholders at the
meeting for ratification. The affirmative vote of a majority of the shares
of Common Stock present at the meeting is required to so appoint Coopers &
Lybrand L.L.P. as the Company's auditors. A representative of Coopers &
Lybrand L.L.P. is not expected to be present at the meeting.
FURTHER INFORMATION
Principal Shareholders
The following table sets forth certain information concerning those
persons who were, on November 7, 1996, believed by the Company to be
beneficial owners of more than 5% of the outstanding shares of the Company's
Common Stock, and also sets forth certain information about ownership of
shares of Common Stock by all directors and officers of the Company as a
group:
Name and Adress Nature of Beneficial Shares Beneficially Owned
of Beneficial Owner Ownership Number Percent
- ------------------- -------------------- -------------------------
Shelby M. Tauber Shares as to which Ms.
150 East 69th Street Tauber exercises sole
Apartment 27H voting and investment 226,904
New York, NY
Shares held in various
trusts pursuant to which
Ms. Tauber and Joel D.
Tauber are co-trustees
with voting and invest-
ment powers 144,186
-------
371,090 29.3%
======= ====
Barbara J. Keywell Shares as to which Ms.
2200 Tottenham Keywell exercises sole
Bloomfield Hills, MI voting and investment
powers 253,882
Shares held in various
trusts pursuant to which
Ms. Keywell is sole
trustee with voting and
investment powers 96,942
--------
350,824 27.7%
======== =====
Gail A. Dishell Shares as to which Ms.
26721 Carol Dishell exercises sole
Franklin, MI voting and investment
powers 251,644
Shares held in various
trusts pursuant to which
Ms. Dishell is sole
trustee with voting
and investment powers 217,885
-------
469,529(1) 37.1%
========= =====
Joel D. Tauber Shares as to which Mr.
2991 Long Ridge Ct. Tauber exercises sole
West Bloomfield, MI voting and investment
powers 65,840
Shares held in various
trusts pursuant to which
Mr. Tauber and Shelby M.
Tauber are co-trustees
with voting and invest-
ment powers 144,186
-------
210,026 16.6%
======= =====
___________________________________
(1) Does not include 1,000 shares held by Ms. Dishell's husband, as to
which she disclaims any beneficial ownership.
All directors and officers of the Company, as a group, beneficially
own 1,257,283 shares (99.2%) of the Company's outstanding Common Stock.
Executive Officers
Set forth below is certain information concerning the Company's
present executive officers, including name, age, principal occupation and
business experience during the past five years, and length of service as an
officer of the Company:
Name and Age Office and Term of Service
------------ --------------------------
Joel D. Tauber, 61 President since October 1995. Also a
manufacturing executive, business
consultant and investor since prior to
1991; Chairman of the Board of Complex
Tooling & Molding, Inc. (Boulder,
Colorado) since March 1996; Co-
Chairman of the Board of Key Plastics, Inc.
(Novi, Michigan) since July 1995
(previously Chairman of the Board since
prior to 1991 through July 1995);
Co-Chairman of the Board of Keywell
Corporation (Chicago, Illinois)
since April 1992 (previously Chairman of
the Board since prior to 1991 through
April 1992); Chairman of the Board of
KMGI, Inc. (formerly Key Manufacturing
Group, Inc.) (Southfield, Michigan) since
prior to 1991
Gail A. Dishell, 60 Vice President since September 1979
Shelby M. Tauber, 61 Treasurer since September 1979
Barbara J. Keywell, 56 Secretary since September 1979
Except as described above, none of the Company's executive officers
have been employed in a principal occupation for the past five years.
Information Concerning Investment Adviser and Investment Advisory Contract
Determination Not to Use Investment Adviser; Termination of
Investment Advisory Contract
At its October 19, 1994 meeting, the Board of Directors decided not
to retain the services of an outside investment adviser and, instead,
determined that the Company, acting through its officers and with the review
provided by the Board, will make investment decisions internally on a going-
forward basis.
The Board's decision not to retain the services of an investment
adviser was made after careful deliberation and was based upon several
factors, including the following:
- The Company's investment objectives are relatively clear-cut
and uncomplicated. The Company's primary investment
objective, as reported in prior filings with the Securities
and Exchange Commission, is "to receive as high a level of
current interest income exempt from federal income taxes as
is available from Municipal Bonds (as defined therein) and
as is consistent with prudent investment management and
preservation of capital, and capital appreciation will be a
minor investment objective of the Company." As a result of
this objective, the Company invests in high quality bonds
which typically have relatively low turnover.
- Given the relatively low turnover in investment securities,
the Board has been able to closely monitor the investment
activity of the Company.
- The fees charged by potential third party investment
advisers were relatively high and, in light of the net
benefit to be provided to the Company, unacceptable.
As a result of its decision not to retain an outside investment
adviser, the Company and Comerica Bank (the "Bank"), effective as of October
19, 1994, terminated the Management and Custodial Agreement, dated September
5, 1979, pursuant to which Agreement the Bank had been providing certain
investment advisory and custodial account services to the Company.
Following such termination, however, the Company and the Bank entered into a
new Custodial Account Agreement, dated October 19, 1994, pursuant to which
the Bank shall continue to provide certain custodial account services for
the Company.
Portfolio -- Allocation and Transactions
The Company's investment portfolio has consisted, and will continue
to consist of, debt obligations issued by states, counties, cities and their
political subdivision or agencies, the interest on which is exempt from
federal income tax in the opinion of bond counsel to the issuer ("Municipal
Bonds"). Municipal Bonds are normally traded in the over-the-counter market
on a net basis (without commissions) through dealers acting for their own
account and not as brokers. Because of this fact, there are no stated
commissions charged with respect to trades for transactions in the Company's
portfolio securities.
When purchasing or selling Municipal Bonds, the Company seeks to
obtain the prompt execution of orders at the most favorable prices
available. To the extent that, in the Company's experience, the execution
capabilities and prices offered by more than once dealer have been
comparable, the Company may, in its discretion, choose to purchase and sell
Municipal Bonds from and to dealers who provide research, statistical and
other information to the Company. However, it is not the Company's policy
to pay a higher price to a dealer solely because it has supplied these
services. Although this type of information is useful to the Company, it is
believed that such services will not reduce the Company's normal research
activities. The Company believes that the types of research services and
information which will be provided by dealers will consist principally of
research reports on particular issues of Municipal Bonds and technical
information concerning general market conditions for Municipal Bonds.
Certain Reporting Requirements
Under the federal securities laws, the Company's directors, its
executive officers, and any persons holding more than 10% of the Company's
Common Stock (collectively, the "Reporting Persons") are required to file
reports with the Securities and Exchange Commission, and to provide the
Company with copies of same, relative to their ownership of the Common
Stock, which reports need to be filed at such time as they first become a
Reporting Person and at such time or times as any changes occur in their
beneficial ownership of the Common Stock. Specific due dates for filing
these reports have been established and the Company is required to disclose
in this Proxy Statement any failure to timely file these reports.
Based on a review of the reports filed by the Reporting Persons,
during and with respect to the fiscal year ended September 30, 1996, and/or
on representations of its Reporting Persons with respect to the fiscal year
ended September 30, 1996, the Company believes that the foregoing reporting
requirements have been satisfied by the Company's Reporting Persons.
Other Matters and Shareholder Proposals
At the date of this Proxy Statement, management is not aware of any
matters to be presented for action at the meeting other than those described
above. However, if any other matters should come before the meeting, it is
the intention of the persons named in the accompanying proxy card to vote in
accordance with their judgment on such matters.
Any proposals of shareholders to be presented at the next Annual
Meeting of Shareholders which are eligible for inclusion in the Company's
proxy statement for that meeting under applicable rules of the Securities
and Exchange Commission must be received by the Company at its principal
executive offices not later than 120 days prior to November 21, 1997.
Southfield, Michigan
November 22, 1996
KEYCO BOND FUND, INC.
PROXY SOLICITED BY BOARD OF DIRECTORS
Annual Meeting of Shareholders
To Be Held December 17, 1996
The undersigned shareholder hereby appoints GEORGE J. FORREST, III
and KENNETH E. KLUSKA, or either one of them, proxies with the power of
substitution to vote, as designated below, all shares of Common Stock which
the undersigned may be entitled to vote at the Annual Meeting of the
Shareholders to be held on Tuesday, December 17, 1996 at 11:00 a.m., E.S.T.,
or at any adjournment thereof, on the following matters described in the
Proxy Statement dated November 22, 1996.
1. ELECTION OF DIRECTORS:
/ /FOR all nominees listed below or / / WITHHOLD AUTHORITY to
any substitute for any of them. vote for all nominees
listed below.
(To withhold authority to vote for any one nominee strike through
his or name below)
Gail A. Dishell Mark E. Schlussel
Thomas E. Purther David K. Page
Ellen T. Horing
2. RATIFYING THE SELECTION of Coopers & Lybrand L.L.P. as independent
auditors for the year ending September 30, 1997.
/ / FOR / / AGAINST / / ABSTAIN
The undersigned instructs the proxies to vote as specified in the
proxy on the matters described in the Proxy Statement dated November 22,
1996. Proxies will be voted as instructed.
Authority is also granted to such proxies to vote in their
discretion upon any other business which may properly come before the
meeting. If no specification is made, proxies will vote as follows: (i)
under Item 1, FOR election of the nominees named above or any substituted
for any of them; and (ii) FOR Item 2.
Receipt is hereby acknowledged of the Notice of Annual Meeting of
Shareholders and Proxy Statement, each dated November 22, 1996.
Dated: , 1996
------------------------------
Signature
------------------------------
Signature
------------------------------
Signature
Please sign exactly as name appears
hereon. If the stock is registered
in the names of two or more persons,
each should sign. Executors,
administrators, trustees, guardians,
attorneys and corporate officers
should add their titles.