UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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 Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-12
KEYCO BOND FUND, 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)(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 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:
________________________________________________________________________________
(2) Form, schedule or registration statement no.:
________________________________________________________________________________
(3) Filing party:
________________________________________________________________________________
(4) Date filed:
________________________________________________________________________________
KEYCO BOND FUND, INC.
27777 FRANKLIN ROAD, SUITE 1630
SOUTHFIELD, MICHIGAN 48034
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD THURSDAY, DECEMBER 13, 2007
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 1630,
Southfield, Michigan 48034, on Thursday, December 13, 2007, at 10:30 a.m.,
Detroit time, 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 Grant Thornton LLP as the Company's registered independent auditor
for the year ending September 30, 2008; and
(3) To transact such other business as may properly come before
the meeting or any adjournments thereof.
Information with respect to these matters is set forth in the accompanying
Proxy Statement. The Board of Directors has fixed the close of business on
November 1, 2007, 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., the 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 28, 2007
KEYCO BOND FUND, INC.
27777 FRANKLIN ROAD, SUITE 1630
SOUTHFIELD, MICHIGAN 48034
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD THURSDAY, DECEMBER 13, 2007
This Proxy Statement and the accompanying form of proxy are to be first
mailed on or about November 28, 2007, to all shareholders of record on November
1, 2007, 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 10:30
a.m., Detroit time, on Thursday, December 13, 2007, at the principal executive
offices of the Company, 27777 Franklin Road, Suite 1630, Southfield, Michigan
48034, 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 1, 2007,
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 1630,
Southfield, Michigan 48034.
COPIES OF THE COMPANY'S MOST RECENT ANNUAL AND SEMI-ANNUAL REPORTS ARE
AVAILABLE TO SHAREHOLDERS UPON REQUEST. IF YOU WOULD LIKE TO RECEIVE A COPY,
PLEASE CONTACT THE COMPANY AT 27777 FRANKLIN ROAD, SUITE 1630, SOUTHFIELD,
MICHIGAN 48034 AND ONE WILL BE SENT, WITHOUT CHARGE, BY FIRST-CLASS MAIL.
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. The address for
each Director is care of the Company at 27777 Franklin Road, Suite 1630,
Southfield, MI 48034.
OTHER SHARES OF
POSITION(S) TERM OF OFFICE DIRECTORSHIPS COMMON STOCK
HELD WITH AND LENGTH OF PRINCIPAL OCCUPATION(S) HELD BY BENEFICIALLY
NAME AND AGE FUND TIME SERVED DURING PAST FIVE YEARS DIRECTOR (1) OWNED
- ------------ -------------- -------------- ------------------------------------------ ------------- ------------
DISINTERESTED DIRECTORS
Mark E. Director One year term Partner in the firm Schlussel & Schefman, None None
Schlussel, Director since attorneys (Birmingham, MI) since April
66 1979 2004; previously of counsel to the firm of
Warner Norcross and Judd, attorneys
(Southfield, MI) July 2002 to March 2004.
David K. Director One year term Partner in the firm of Honigman Miller Director of None
Page, 74 Director since Schwartz and Cohn, attorneys (Detroit, MI) Meadowbrook
1989 for more than five years. Insurance
Group, Inc.
INTERESTED DIRECTORS(2)
Gail A. Director, One year term Vice President of the Company since None 470,529(3)
Dishell, 71 Vice-President Director since September 1979; Investor.
1984
Thomas E. Director, One year term CEO of Paramount Bancorp, Inc., a bank None 24,715(4)
Purther, 42 Secretary Director since holding company (Farmington Hills, MI)
1994 since February 1998; Chairman of Paramount
Bank, a commercial bank (Farmington Hills,
MI) since February 1998; Chairman of
Paramount Bank of Nevada, a commercial
bank (Las Vegas, NV) since July 2007;
Chairman and CEO of Cambridge Investors,
LLC, real estate acquisition, development
and management company (Farmington Hills,
MI) since June 2000; and a partner in Key
Homes, residential housing builder
(Farmington Hills, MI) December 1993 to
December 2003.
2
Ellen T. Director, One year term Portfolio manager of Highgate Partners, 53,477(5)
Horing, 44 Treasurer Director since L.P., an investment partnership (Mt.
1995 Kisco, NY) since January 1993; portfolio
advisor and partner, Sterling Stamos
Capital Management, LP (formerly SP
Capital Management, LP) (New York, NY)
January 2003 to December 2004 and reduced
interest limited partner in Sterling
Stamos Capital Management, LP from
December 2004 to July 2007.
- ----------
(1) Other directorships includes positions held as a director or trustee of any
company with a class of securities registered with the SEC pursuant to
federal securities laws and any investment company registered with the SEC.
(2) 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.
(3) Includes certain shares pursuant to which Ms. Dishell is trustee. See
"Principal Shareholders."
(4) 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."
(5) 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."
The nominees receiving a plurality of votes cast at the meeting will be
elected directors. 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 also 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. During the fiscal year ended September 30, 2007, the
Board of Directors had 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) (the "Disinterested Directors") were each paid $1,500 for
the year ended September 30, 2007. The Company does not maintain any retirement
plan or program for its officers or directors and the Company does not have any
agreement or arrangement with any officer or director to pay any form of
retirement benefit. During the year ended September 30, 2007, there was one
meeting of the Board of Directors of the Company and there was one meeting of
the shareholders of the Company. All directors were present at the meeting of
the Board of Directors and none were present at the meeting of the shareholders.
During the year ended September 30, 2007, 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 and $39,000 for accounting and
administrative services provided by an entity owned by an officer of the
Company.
The following table provides certain information relating to the equity
securities beneficially owned by each director or director nominee as of
November 1, 2007, (i) in the Company and (ii) on an aggregate basis, in any
registered investment companies overseen or to be overseen by the director or
nominee within the same family of investment companies as the Company.
AGGREGATE DOLLAR RANGE OF
EQUITY SECURITIES IN ALL
FUNDS OVERSEEN OR TO BE
OVERSEEN BY DIRECTOR OR
NAME OF DIRECTOR OR DOLLAR RANGE OF EQUITY NOMINEE IN FAMILY OF
NOMINEE SECURITIES IN THE COMPANY INVESTMENT COMPANIES
- ------------------- ------------------------- -------------------------
INTERESTED DIRECTORS
Gail A. Dishell Over $100,000 Over $100,000
Thomas E. Purther Over $100,000 Over $100,000
Ellen T. Horing Over $100,000 Over $100,000
INDEPENDENT DIRECTORS
Mark E. Schlussel None None
David K. Page None None
3
(2) RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The directors of the Company who are not "interested persons" have
unanimously appointed Grant Thornton LLP ("Grant Thornton"), registered
independent public accountants, to audit the financial statements of the Company
for the current fiscal year ending September 30, 2008. Grant Thornton served in
such capacity for the year ended September 30, 2007. Grant Thornton has no
direct or indirect interest in the Company other than as its 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 appoint Grant Thornton as the
Company's independent public accountants. A representative of Grant Thornton is
not expected to be present at the meeting.
INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS
FEES OF INDEPENDENT PUBLIC ACCOUNTANT
The following table presents the fees for professional services rendered by
Grant Thornton for the fiscal years ended September 30, 2006 and September 30,
2007.
FEE CATEGORY 2006 FEES 2007 FEES
- ------------ --------- ---------
Audit fees............ $16,500 $17,000
Audit-related fees.... 0 0
Tax fees.............. 3,500 3,500
All other fees........ 0 0
------- -------
Total fees............ $20,000 $20,500
======= =======
Tax fees are fees billed for professional services rendered by Grant
Thornton for tax compliance, tax advice and tax planning. The Board of Directors
does not consider the provision of the services described above by Grant
Thornton to be incompatible with the maintenance of Grant Thornton's
independence.
The Company's Board of Directors pre-approves all audit and permissible
non-audit services rendered to the Company.
REPORT OF BOARD OF DIRECTORS
The Board of Directors received from the independent registered public
accountants, Grant Thornton, and reviewed a formal written statement describing
all relationships between Grant Thornton and the Company that might bear on the
auditors' independence consistent with Independence Standards Board Standard No.
1, "Independence Discussions with Audit Committees," discussed with the auditors
any relationships that may impact their objectivity and independence and
satisfied itself as to the independence of Grant Thornton.
The Board of Directors discussed with Grant Thornton the matters required
to be discussed by Statement on Auditing Standards No. 61, as amended,
"Communication with Audit Committees," and, with and without management present,
discussed and reviewed the results of the independent auditors' examination of
the financial statements of the Company as of and for the fiscal year ended
September 30, 2007, including the quality of accounting principles and
significant judgments affecting the financial statements.
4
The Board of Directors, based on the above-mentioned reviews and
discussions with management and Grant Thornton, resolved that the Company's
audited financial statements be included in its Annual Report to Shareholders
for the year ended September 30, 2007 for filing with the Securities and
Exchange Commission. The Board of Directors consists of Mark E. Schlussel, David
K. Page, Gail A. Dishell, Thomas E. Purther and Ellen T. Horing.
FURTHER INFORMATION
SECURITY OWNERSHIP OF MANAGEMENT
The following table presents information regarding beneficial ownership of
the Company's shares by each member of the Board of Directors of the Company, by
the executive officers of the Company, and by all directors and executive
officers of the Company as a group as of November 1, 2007. Except as indicated
in the table and footnotes below, each person exercises sole voting and
investment power with respect to such shares.
SHARES OF COMMON STOCK PERCENTAGE
NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED OWNED
- ------------------------ ---------------------- ----------
Gail A. Dishell............... 470,529(1) 37.1%
Joel D. Tauber................ 197,169(2) 15.6%
Ellen T. Horing............... 53,477(3) 4.2%
Thomas E. Purther............. 24,715(4) 2.0%
Mark E. Schlussel............. none 0.0%
David K. Page................. none 0.0%
All executive officers
and directors as a group... 692,413 54.6%
- ----------
(1) Includes 217,885 shares held in various trusts pursuant to which Ms.
Dishell is a trustee with voting and investment powers.
(2) Includes 131,329 shares held in various trusts pursuant to which Mr. Tauber
and Shelby M. Tauber are co-trustees with voting and investment powers.
Does not include 12,857 shares held by Mr. Tauber's wife, as to which he
disclaims any beneficial ownership.
(3) 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.
(4) 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.
PRINCIPAL SHAREHOLDERS
The following table sets forth certain information concerning those persons
who were, on November 1, 2007, 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:
TITLE OF NAME AND ADDRESS OF PERCENT OF
CLASS BENEFICIAL OWNER AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP CLASS
- -------- -------------------- ---------------------------------------------------- ----------
Common Stock Shelby M. Tauber 226,904 Shares as to which Ms. Tauber exercises
150 East 69th Street sole voting and investment powers
Apt. 27H
New York, NY 131,329 Shares held in various trusts pursuant to
------- which Ms. Tauber and Joel D. Tauber are
co-trustees with voting and investment
powers
358,233 28.3%
======= ====
5
Common Stock Barbara J. Keywell 253,882 Shares as to which Ms. Keywell exercises
2200 Tottenham sole voting and investment powers
Bloomfield Hills, MI
96,942 Shares held in various trusts pursuant to
------- which Ms. Keywell is sole trustee with
voting and investment powers
350,824 27.7%
======= ====
Common Stock Gail A. Dishell 252,644 Shares as to which Ms. Dishell exercises
26721 Carol sole voting and investment powers
Franklin, MI
217,885 Shares held in various trusts pursuant to
------- which Ms. Dishell is a trustee with
470,529 voting and investment powers 37.1%
======= ====
Common Stock Joel D. Tauber 65,840 Shares as to which Mr. Tauber exercises
2991 Long Ridge Ct. sole voting and investment powers
West Bloomfield, MI
131,329 Shares held in various trusts pursuant to
------- which Mr. Tauber and Shelby M. Tauber are
co-trustees with voting and investment
197,169(1) powers 15.6%
======= ====
- ----------
(1) Does not include 12,857 shares held by Mr. Tauber's wife, as to which he
disclaims any beneficial ownership.
All directors and officers of the Company, as a group, beneficially own
1,245,426 shares (98.3%) of the Company's outstanding Common Stock.
EXECUTIVE OFFICERS
Set forth below is certain information concerning the Company's 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, 72 President since October 1995. Also a manufacturing
executive, business consultant and investor since prior
to 1999; Chairman of the Board of Directors of KCL
Management Corp. (Chicago, IL) since December 2005;
Chairman of the Board of Keywell Corporation (Chicago,
IL) from 1996 to December 2005; Manager of Carolina
Precision Plastics, LLC (Asheboro, NC) since June 2004;
Co-Manager of Carolina Precision Plastics, LLC
(Asheboro, NC) from July 2002 to June 2004; Chairman of
the Board of Key Plastics Holdings, Inc. (Novi, MI)
since July 1995.
Gail A. Dishell, 71 Vice President since September 1979.
Ellen T. Horing, 44 Treasurer since March 2003. Also portfolio manager of
Highgate Partners, L.P., an investment partnership (Mt.
Kisco, NY) since January 1993; portfolio advisor and
partner, Sterling Stamos Capital Management, LP
(formerly SP Capital Management, LP) (New York, NY)
January 2003 to December 2004 and reduced interest
limited partner in Sterling Stamos Capital Management,
LP from December 2004 to July 2007.
6
Thomas E. Purther, 42 Secretary since March 2003. Also CEO of Paramount
Bancorp, Inc., a bank holding company, Chairman of its
subisidiary Paramount Bank, a commercial bank
(Farmington Hills, MI) since February 1998, and Chairman
of its subsidiary Paramount Bank of Nevada (Las Vegas,
NV) since July 2007; Chairman and CEO of Cambridge
Investors, LLC, real estate acquisition, development and
management company (Farmington Hills, MI) since June
2000; and a partner in Key Homes, residential housing
builder (Farmington Hills, MI) from December 1993 to
December 2003.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
The officers of the Company receive no compensation from the Company for
their service as officers.
Joel D. Tauber is President of the Company. He receives no compensation
from the Company for his service as an officer.
Ellen T. Horing is the Treasurer and the Chief Compliance Officer of the
Company and a director. She receives no compensation from the Company for her
service as a director or as an officer.
Only the independent directors received compensation from the Company for
their service as directors. The Company did not offer its directors any pension
or retirement benefits, or any other similar long-term incentive compensation or
benefits, during or prior to the year ended September 30, 2007.
The following table provides information regarding the compensation of the
independent directors for the year ended September 30, 2007.
FEES EARNED TOTAL COMPENSATION
NAME OR PAID IN CASH RECEIVED FROM COMPANY
- ---- --------------- ---------------------
Mark E. Schlussel $1,500 $1,500
David K. Page 1,500 1,500
The Company does not pay any other compensation or any pension (retirement)
benefits to any directors or officers.
COMMITTEES OF THE BOARD
The Board of Directors as a whole performs the functions of an audit
committee, nominating committee and compensation committee and there are no
separate committees of the Board of Directors. The Company believes that this is
appropriate due to its small size and that more than ninety-eight percent (98%)
of the outstanding voting stock is owned by members of the Keywell family. The
Board of Directors does not have an audit committee charter, a nominating
committee charter or a compensation committee charter.
NOMINATING PROCESS
The Board of Directors as a whole is responsible for the selection and
nomination of directors. The Company does not retain a third party to assist in
the identification of directors. The Board of Directors does not have a formal
policy with regard to the consideration of any director candidates recommended
by shareholders. The Board of Directors will consider director candidates
recommended by shareholders and therefore it does not believe that a formal
policy is necessary. The Board of Directors as a whole selected and approved the
director nominees contained in this proxy statement.
7
When seeking to identify an individual to become a director, the Board of
Directors will consult with incumbent directors, management and others. The
Board of Directors will consider, among other factors, the background and
reputation of potential candidates in terms of character, personal and
professional integrity, business and financial experience and acumen, how a
person would complement the other directors in providing a diversity of
expertise and experience and a person's availability to devote sufficient time
to Board of Director duties.
To recommend a nominee, shareholders should write to the Company's
Secretary c/o Keyco Bond Fund, Inc., 27777 Franklin Road, Suite 1630,
Southfield, Michigan, 48034. To be considered by the Board of Directors for
nomination and inclusion in the Company's Proxy Statement for its 2008 Annual
Meeting of Shareholders, a shareholder recommendation for a director must be
received by the Company's Secretary no later than July 31, 2008. Any
recommendation must include (i) the name and address of the candidate, (ii) a
brief biographical description, including his or her occupation for at least the
last five years, and a statement of the qualifications of the candidate, taking
into account the qualification requirements summarized above, and (iii) the
candidate's signed consent to be named in the proxy statement and to serve as a
director if elected.
Assuming the appropriate background material is provided for candidates
submitted by shareholders, the process followed by the Board of Directors to
identify and evaluate candidates described above will be used to evaluate those
candidates submitted by shareholders and the Board of Directors will apply
substantially the same criteria.
COMMUNICATIONS WITH DIRECTORS
Stockholders may communicate with the Board of Directors or any individual
director by sending a letter to Keyco Bond Fund, Inc., 27777 Franklin Road,
Suite 1630, Southfield, Michigan, 48034, Attn: Presiding Director (or any
individual director). The Secretary will receive the correspondence and forward
it to the presiding director or to any individual director or directors to whom
the communication is directed. The Secretary is authorized to review, sort and
summarize all communications received prior to their presentation to the
presiding director or to whichever director(s) the communication is addressed.
If such communications are not a proper matter for Board attention, such
individuals are authorized to direct such communication to the appropriate
department. For example, stockholder requests for materials or information will
be directed to investor relations personnel.
INFORMATION CONCERNING INVESTMENT MATTERS
Determination Not to Use Investment Adviser; Termination of Investment Advisory
Contract
The Board of Directors has decided not to retain the services of an outside
investment adviser and, instead, has authorized the officers of the Company,
with review provided by the interested directors of the Company (Gail A.
Dishell, Ellen T. Horing and Thomas E. Purther), to make investment decisions
internally.
8
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.
The Company has entered into a Custodial Account Agreement with Comerica
Bank pursuant to which the Bank provides certain custodial account services for
the Company.
Portfolio -- Brokerage 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 subdivisions 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.
SECTION 16 BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
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.
9
Based on a review of the reports filed by the Reporting Persons, during and
with respect to the fiscal year ended September 30, 2007, and/or on
representations of its Reporting Persons with respect to the fiscal year ended
September 30, 2007, 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.
Shareholder proposals intended to be presented at the 2008 annual meeting
which are eligible for inclusion in the Company's proxy statement for that
meeting under Rule 14a-8 promulgated under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), must be received by the Company at its
principal executive offices no later than July 31, 2008. Shareholder proposals
intended to be presented at the 2008 annual meeting which are not eligible for
inclusion in the Company's proxy statement for that meeting under Rule 14a-8 are
considered untimely under Rule 14a-5 promulgated under the Exchange Act unless
received by the Company at its principal executive offices no later than October
12, 2008, and the Company expects the persons named as proxies for the 2008
annual meeting to use their discretionary voting authority with respect to any
proposal considered untimely at the 2008 annual meeting.
Southfield, Michigan
November 28, 2007
10
KEYCO BOND FUND, INC.
PROXY SOLICITED BY BOARD OF DIRECTORS
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD THURSDAY, DECEMBER 13, 2007
The undersigned shareholder hereby appoints JOEL D. TAUBER and DAVID L. SIMON,
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
Thursday, December 13, 2007, at 10:30 a.m., Detroit time, or at any adjournment
thereof, on the following matters described in the Proxy Statement dated
November 28, 2007.
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 Grant Thornton LLP as the Company's registered
independent public accountants for the year ending September 30, 2008.
[ ] 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 28, 2007. 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 28, 2007.
Dated:
---------------------------, 2007
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Signature
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Signature
Please sign exactly as your name appears
hereon. If your 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. Return this completed proxy to:
Keyco Bond Fund, Inc.
27777 Franklin Road, Suite 1630
Southfield, MI 48034