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)
David W. Geiss, 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 16, 1997
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 16, 1997, 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, 1998; 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, dated November 21, 1997, which accompanies this Notice.
The Board of Directors has fixed the close of business on November 7,
1997, 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 (i.e. blue
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 21, 1997
KEYCO BOND FUND, INC.
27777 Franklin Road, Suite 1850
Southfield, Michigan 48034
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 16, 1997
This Proxy Statement and the accompanying form of proxy are to be first
mailed on or about November 21, 1997 to all shareholders of record on November
7, 1997, 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 16, 1997, 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,
1997, 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 as "proxies" 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, 61(1) Vice President of the Company since 1984 469,529(2) 37.1%
September 1979; Investor
Mark E. Schlussel, 57 Of Counsel to the firm of Pepper, Hamilton and 1979 -0-
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, 64 Partner in the firm of Honigman Miller Schwartz 1989 -0-
and Cohn, attorneys (Detroit, Michigan)
Thomas E. Purther, 32(1) Partner in Key Homes, residential housing builder 1994 24,715(3) 2.0%
(since December 1993) (Bingham Farms, Michigan),
Chief Executive Officer of United Capital Financial,
LLC, residential mortgage lender (since June 1996)
(Bingham Farms, Michigan) and Chief Executive
Officer of Global Commercial Credit, LLC, business
receivables insurance agency (since March 1996)
(Bingham Farms, Michigan); previously financial
analyst for Keywell Corporation (scrap metal) (from
September 1991 to December 1993) (Chicago, Illinois)
Ellen T. Horing, 35(1) Portfolio manager of Highgate Partners, an invest- 1995 53,477(4) 4.2%
ment partnership (since January 1993) (Mt. Kisco,
New York); Previously Director of Research and
Vice President, 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, 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, 1997, the Board of Directors met once and all directors were
present. During the year ended September 30, 1997, 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, 1998. This firm served in such capacity for the year
ended September 30, 1997, 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, 1997, 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 Address Shares Beneficially Owned
of Beneficial Owner Nature of Beneficial Ownership Number Percent
- ------------------- ------------------------------ ------ -------
Shelby M. Tauber Shares as to which Ms. Tauber exercises sole voting
150 East 69th Street and investment powers 226,904
Apartment 27
New York, NY
Shares held in various trusts pursuant to which Ms.
Tauber and Joel D. Tauber are co-trustees with voting
and investment powers 144,186
-------
371,090 29.3%
======= ====
Barbara J. Keywell Shares as to which Ms. Keywell exercises sole voting
2200 Tottenham and investment powers 253,882
Bloomfield Hills, MI
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. Dishell exercises sole voting
26721 Carol and investments powers 251,644
Franklin, MI
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. Tauber exercises sole voting
2991 Long Ridge Ct. and investment powers 65,840
West Bloomfield, MI
Shares held in various trusts pursuant to which Mr.
Tauber and Shelby M. Tauber are co-trustees with
voting and investment 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, 62 President since October 1995. Also a manufacturing
executive, business consultant and investor since
prior to 1992; 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 1992 through
July 1995); Co-Chairman of the Board of Keywell
Corporation (Chicago, Illinois) since April 1992;
Chairman of the Board of KMGI, Inc. (formerly Key
Manufacturing Group, Inc.) (Southfield, Michigan)
since prior to 1992
Gail A. Dishell, 61 Vice President since September 1979
Shelby M. Tauber, 62 Treasurer since September 1979
Barbara J. Keywell, 57 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 Matters
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 one 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, 1997, and/or on
representations of its Reporting Persons with respect to the fiscal year
ended September 30, 1997, 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 20, 1998.
Southfield, Michigan
November 21, 1997
KEYCO BOND FUND, INC.
PROXY SOLICITED BY BOARD OF DIRECTORS
Annual Meeting of Shareholders
To Be Held December 16, 1997
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 16, 1997 at 11:00 a.m., or at any adjournment
thereof, on the following matters described in the Proxy Statement dated
November 21, 1997.
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 her
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, 1998.
[ ] 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 21, 1997.
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 21, 1997.
Dated: , 1997
----------------------------------------------
Signature
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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.