<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant / /
Filed by a Party other than the Registrant |X|
Check the appropriate box:
/X/ Preliminary Proxy Statement / / Confidential, for Use of the
/ / Definitive Proxy Statement Commission Only (as permitted by
/ / Definitive Additional Materials Rule 14a-6(e)(2))
/ / Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
BULL & BEAR U.S. GOVERNMENT SECURITIES FUND, INC.
-------------------------------------------------
(Name of Registrant as Specified in Its Charter)
KARPUS MANAGEMENT, INC. d/b/a KARPUS INVESTMENT MANAGEMENT
-----------------------
(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 Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies: Not
applicable.
(2) Aggregate number of securities to which transaction applies: Not
applicable.
(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): Not applicable.
(4) Proposed maximum aggregate value of transaction: Not applicable.
(5) Total fee paid: Not applicable.
/ / 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: Not applicable.
(2) Form, Schedule or Registration Statement No.: Not applicable.
(3) Filing Party: Not applicable.
(4) Date Filed: Not applicable.
<PAGE>
PRELIMINARY COPY DATED OCTOBER 29, 1997
BULL & BEAR U.S. GOVERNMENT SECURITIES FUND, INC.
------------------------------------------------
PROXY STATEMENT
OF KARPUS MANAGEMENT, INC. d/b/a
KARPUS INVESTMENT MANAGEMENT
------------------------------------------------
This Proxy Statement is furnished in connection with a solicitation of
proxies by Karpus Management, Inc., doing business as Karpus Investment
Management ("KIM"), to be used at the Annual Meeting of Stockholders ("Meeting")
of Bull & Bear U.S. Government Securities Fund, Inc. (the "Fund") to be held on
Thursday, November 20, 1997 at 8:00 a.m. at the offices of Stroock & Stroock &
Lavan LLP, 180 Maiden Lane, 34th Floor, New York, New York, (i) to elect
directors of the Fund to serve for a specified term and until their successors
are duly elected and qualified, (ii) to ratify the selection of Tait, Weller &
Baker as the Fund's independent auditors, and (iii) to transact such other
business as may properly come before the Meeting or any adjournment thereof.
Stockholders of record at the close of business on October 1, 1997 are
entitled to be present and to vote on matters at the Meeting. Stockholders are
entitled to one vote for each Fund share held and fractional votes for each
fractional Fund share held. Shares represented by executed and unrevoked proxies
will be voted in accordance with the specifications made thereon. If any
enclosed form of proxy is executed and returned, it nevertheless may be revoked
by another proxy or by letter or telegram directed to the Fund, which must
indicate the stockholder's name. To be effective, such revocation must be
received prior to the Meeting. In addition, any stockholder who attends the
Meeting in person may vote by ballot at the Meeting, thereby canceling any proxy
previously given. As of October 1, 1997, the Fund had 735,287.713 shares of
common stock issued and outstanding. Stockholders of the Fund will vote as a
single class.
It is estimated that this Proxy Statement will be mailed to
stockholders of record on or about November 8, 1997. KIM's principal executive
offices are located at 14 Tobey Village Office Park, Pittsford, New York 14534.
Copies of the Fund's most recent Annual and Semi-Annual Reports are available
without charge upon written request to the Fund at its principal executive
offices, 11 Hanover Square, New York, New York 10005, or by calling toll-free
1-888-847-4200.
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PROPOSAL 1: ELECTION OF DIRECTORS
KIM is proposing the election of KIM Nominees so that the Board of
Directors will take action to change the Fund to an "open end" format, rather
than the current "closed end" format approved in 1996. KIM also wishes to
preserve the Fund's investment objective of providing a high level of current
income, liquidity and safety of principal. Management of the Fund had previously
proposed that the objectives and fundamental investment policies of the Fund be
changed to include a much broader range of permissible investments that could
include up to 50% in equity securities along with securities denominated in
foreign currencies and various additional investment techniques, such as futures
and options transactions, and foreign currency transactions. Also, the
management of the Fund previously proposed changing the classification of the
Fund from a diversified investment company to a non-diversified investment
company. KIM opposed these changes.
The Fund's Board of Directors is currently divided into five classes
with the term of office of one class expiring each year. KIM proposes that
stockholders of the Fund elect the following nominees (the "KIM Nominees"):
Kenneth P. Leisegang as a Class I Director to serve for a one year term, Brad
Orvieto as a Class II Director to serve for a two year term, Bruno A. Sniders as
a Class III Director to serve for a three year term, Donald R. Chambers as a
Class IV Director to serve for a four year term, and George W. Karpus as a Class
V Director to serve for a five year term, and, in each case, until his
respective successor is duly elected and qualified. The following table sets
forth certain information concerning each of the KIM Nominees. None of the KIM
Nominees is now serving or has previously served as a director of the Fund and
none has been compensated by the Fund. None of the KIM Nominees is deemed to be
an "interested person" of the Fund, as defined in the Investment Company Act of
1940, as amended ("1940 Act").
Name, Principal Occupation and Business
Experience for Past Five Years Year
Term
Expires
Class I:
KENNETH P. LIESEGANG, age 47, is the founder and president of 1998
RSVP Business Systems, Inc., a Rochester, New York based
computer consulting firm founded in 1986. His address is 5 Fox
Hill Drive, Fairport, New York 14450.
Class II:
BRAD ORVIETO, age 40, is a Certified Financial Planner and was 1999
the founder and has acted as a principal of Horizon Financial
Group, Plantation, Florida, for at least the past 5 years.
His
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<PAGE>
Name, Principal Occupation and Business Year Term
Experience for Past Five Years Expires
address is 10824 Northwest Second Street, Plantation,
Florida 33324.
Class III:
BRUNO A. SNIDERS, age 61, has been the president and owner of 2000
Alexander Communications Inc., a marketing, advertising and
media consulting firm in Webster, New York for at least the
past 5 years. His address is 746 DeWitt Road, Webster, New York
14580.
Class IV:
DONALD R. CHAMBERS, age 41, has been Walter E. Hanson/KPMG Peat 2001
Marwick Professor of Finance, Department of Economics and
Business at Lafayette College, Easton, Pennsylvania, for at
least the past 5 years. He has a Ph.D. from the University of
North Carolina at Chapel Hill, North Carolina. A senior
portfolio strategist and consultant, Dr. Chambers serves as a
consultant to industry and government, having advised the
Consumer Advocate's office of the Commonwealth of Pennsylvania,
AT&T, Allstate, Bank of New York, Chase Manhattan Bank and
other major corporations. Among his publishing credits are The
Journal of Financial Economics, The Journal of Cash Management,
The Journal of Finance, The Journal of Futures Markets, The
Journal of Financial and Quantitative Analysis and Financial
Management. He is the author of a corporate finance textbook
with Harper Collins entitled Modern Corporate Finance, Theory &
Practice. His address is 3325 Abbey Court, Bethlehem,
Pennsylvania 18017.
Class V:
GEORGE W. KARPUS, age 51, is president and chairman of KIM, a 2002
registered investment adviser in Pittsford, New York, a firm he
established in 1986. KIM specializes in conservative asset
management for corporations, pension and profit sharing plans,
endowments and trusts and individuals with high net worth. A
past president of the Cash Management Association of Monroe
County, Mr. Karpus serves on the Editorial Advisory Board of
Money Market Insights. The firm, a fixed income manager, has
been ranked among the top four percentile by
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<PAGE>
Name, Principal Occupation and Business Year Term
Experience for Past Five Years Expires
Nelson's "World's Best Money Managers." His address is 796
Admiralty Way, Webster, New York 14580.
KIM RECOMMENDS A VOTE FOR THE ELECTION OF
ALL NOMINEES NAMED ABOVE
The persons listed in the accompanying form of proxy intend to vote
each such proxy for the election of the KIM Nominees, as listed above, unless
stockholders specifically indicate on their proxies the desire to withhold
authority to vote for any one or more of the KIM Nominees. It is not
contemplated that any KIM Nominee will be unable to serve as a Director for any
reason, but if that should occur prior to the Meeting, the proxyholders reserve
the right to substitute another person or persons of their choice as a KIM
Nominee or as KIM Nominees. Each KIM Nominee listed above has consented to being
named in this Proxy Statement and has agreed to serve as a Director if elected.
None of the KIM Nominees has ever been an officer, employee, director,
general partner or shareholder of Bull & Bear Advisers, Inc., the Fund's
investment manager, or any affiliate thereof, nor has any of such KIM Nominees
had any other material direct or indirect interest in such investment manager or
any of its affiliates or the Fund's principal underwriter or administrator. None
of the KIM Nominees or an affiliate of any of them is engaged in any material
pending legal proceedings adverse to the Fund or any of its affiliates. None of
the KIM Nominees nor KIM has been convicted in a criminal proceeding for at
least the past 10 years.
KIM has been advised by the Fund as follows:
The Fund has an audit committee comprised of currently all of its
directors, the function of which is routinely to review financial
statements and other audit-related matters as they arise throughout the
year. The Fund has no standing or nominating or compensation committee or
any committee performing similar functions.
The Fund pays its directors who are not "interested persons" of the
Fund an annual retainer of $2,500, and a per meeting fee of $2,500, and
reimburses them for their meeting expenses. The Fund also pays such
directors $250 per special telephonic meeting attended and per committee
meeting attended. The Fund does not pay any other remuneration to its
executive officers and directors, and the Fund has no bonus,
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<PAGE>
pension, profit-sharing, or retirement plan. The Fund had four Board
meetings and no committee meetings during the Fund's most recently
completed fiscal year.
Vote Required
The Fund's management has taken the position that any action submitted
to a vote by stockholders, such as the proposed election of the KIM Nominees,
requires the affirmative vote of at least eighty percent (80%) of the
outstanding shares of all classes of voting stock, voting together, in person or
by proxy at a meeting at which a quorum is present, unless such action is
approved by the vote of a majority of the Board of Directors.
KIM does not believe that the Fund's management is correct. KIM
believes that if a majority of the votes cast are in favor of the KIM Nominees,
the KIM Nominees will be elected.
PROPOSAL 2: RATIFICATION OF THE SELECTION OF INDEPENDENT AUDITORS
KIM is not soliciting proxies with respect to the ratification of the
selection of independent auditors.
OTHER MATTERS
KIM and the following advisory clients for whom it acts as
investment adviser will bear the cost of soliciting proxies: Acra-Local 725
Pension Trust of Dade, Amalgamated Transit Union Local #1342, Cardinal American
Corporation, Jeffrey I Cooper, Elderwood Affiliates, Inc. Retirement Plan,
Seymour Fisher Marital Tr., Fish Furniture Profit Sharing Tr., The William and
Estelle Golub Foundation Inc., Hammer Lithograph Corp. Deferred Profit Sharing,
Peter Russo, Trustee U/W William Henderson FBO F. Elizabeth, City of Hialeah
Police Pension Fd., Inter Metro Ind. Corp. Salaried Employees Pension Trust,
James E. Morris IRA Rollover, Monro Muffler Brake Inc. Retirement Plan, Painters
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<PAGE>
Local 150 Annuity Fund, Plumbers & Pipefitters Local 138 Pension Fund, Roman
Catholic Diocese of Syracuse Inc., Sheet Metal Workers Local 46 Annuity Fund,
Sheet Metal Workers Local 46 Pension Fund, YWCA of Rochester & Monroe County -
Board Designated Fd. and YWCA of Rochester & Monroe County - Endowment Fund. In
addition to the use of the mails, proxies may be solicited personally, by
telephone or by other means and such clients may pay persons holding Fund shares
in their names or those of their nominees for their expenses in sending
soliciting materials to their principals. Solicitations will be made by the
regular employees of KIM. In addition, the Fund will retain Georgeson & Company
Inc., Wall Street Plaza, New York, New York 10005, to solicit proxies on behalf
of the Board for a fee estimated at $20,000 plus expenses. Additional costs and
expenditures, including fees for attorneys, printing and mailing are anticipated
to be approximately $50,000. KIM intends to seek reimbursement of some or all of
such costs from the Fund.
KIM has been advised by the Fund as follows:
If a proxy is properly executed and returned accompanied by
instructions to withhold authority to vote, represents a broker "non-vote"
(that is, a proxy from a broker or nominee indicating that such person has
not received instructions from the beneficial owner or other person
entitled to vote shares of the Fund on a particular matter with respect to
which the broker or nominee does not have discretionary power) or is
marked with an abstention (collectively, "abstentions"), the Fund's shares
represented thereby will be considered to be present at the Meeting for
purposes of determining the existence of a quorum for the transaction of
business. Under Maryland law, abstentions do not constitute a vote "for"
or "against" a matter and will be disregarded in determining "votes cast"
on an issue.
In the event that a quorum is not present at the Meeting, or if a
quorum is present but sufficient votes to approve any of the proposals are
not received, the persons named as proxies may propose one or more
adjournments of the Meeting to permit further solicitation of proxies. In
determining whether to adjourn the meeting the following factors may be
considered: the nature of the proposals that are the subject of the
Meeting, the percentage of votes actually cast, the percentage of negative
votes actually cast, the nature of any further solicitation, and the
information to be provided to stockholders with respect to the reasons for
the solicitation. Any adjournment will require the affirmative vote of a
majority of those shares affected by the adjournment that are represented
at the meeting in person or by proxy. A stockholder vote may be taken for
one or more of the proposals in this Proxy Statement prior to any
adjournment if sufficient votes have been received for approval. If a
quorum is present, the persons named as management proxies will vote
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<PAGE>
those proxies which they are entitled to vote "for" a Proposal in favor of
any adjournment, and will vote those proxies required to be voted
"against" a Proposal against any adjournment. A quorum is constituted with
respect to the Fund by the presence in person or by proxy of the holders
of a majority of the outstanding shares of the Fund entitled to vote at
the Meeting.
Whether or not a quorum is present, the persons named as KIM's proxies
may vote for or against an adjournment in accordance with their judgment on such
matters.
As of the record date KIM owned 99,250 shares or 13.5% of total
outstanding shares. KIM Nominee George W. Karpus, as President and controlling
stockholder of KIM, is a controlling person of KIM and may be deemed to be a
beneficial owner of such shares. None of the other KIM Nominees purchased or
sold any of such shares. The following table sets forth the shares of the Fund's
common stock purchased by KIM during the past 2 years. None of such shares were
sold.
<TABLE>
<CAPTION>
Dates Amounts Purchased Dates Amounts Purchased
----- ----------------- ----- -----------------
<S> <C> <C> <C>
12/03/96 300 05/23/97 1,200
12/09/96 700 05/27/97 3,400
12/10/96 1,300 05/28/97 300
12/12/96 200 05/29/97 100
12/13/96 3,800 05/30/97 600
12/16/96 1,500 06/12/97 150
12/17/96 200 06/16/97 1,500
01/07/97 700 06/17/97 1,900
01/08/97 900 06/18/97 1,500
01/15/97 500 06/19/97 4,100
01/16/97 200 07/28/97 1,200
01/17/97 300 07/31/97 600
02/21/97 1,100 08/01/97 1,000
02/24/97 1,100 08/04/97 300
02/24/97 1,000 08/05/97 200
02/25/97 1,000 08/11/97 9,500
02/26/97 800 08/13/97 100
03/10/97 1,000 08/15/97 2,200
03/11/97 2,000 08/18/97 2,900
03/12/97 2,600 08/20/97 200
04/03/97 2,000 08/21/97 1,400
04/07/97 1,000 08/22/97 600
04/09/97 700 08/25/97 200
04/14/97 2,300 08/26/97 400
04/15/97 100 08/27/97 900
04/16/97 400 08/29/97 1,300
04/18/97 100 09/02/97 1,100
04/21/97 1,100 09/17/97 300
04/22/97 600 10/02/97 600
04/23/97 400 10/03/97 8,100
04/24/97 4,200 10/09/97 1,100
05/16/97 24,200 10/10/97 25,650
05/19/97 900 10/16/97 2,500
05/20/97 100
05/22/97 800
</TABLE>
KIM is not aware of any other matters which may come before the
Meeting. Should any such matters with respect to the Fund properly come before
the Meeting, it is the intention of the persons named in the accompanying form
of proxy to vote the proxy in accordance with their judgment on such matters.
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<PAGE>
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, STOCKHOLDERS WHO
DO NOT EXPECT TO ATTEND THE MEETING IN PERSON ARE URGED TO COMPLETE, SIGN, DATE
AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED STAMPED ENVELOPE.
Dated: November __, 1997
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<PAGE>
PROXY
Karpus Management, Inc.
14 Tobey Village Office Park
Pittsford, New York 14534
This Proxy is Solicited on Behalf of Karpus Management, Inc.
The undersigned hereby appoints George W. Karpus and Donald R. Chambers as
Proxies, each with the power to appoint his substitute, and hereby authorizes
them to represent and to vote, as designated below, all the shares of common
stock of Bull & Bear U.S. Government Securities Fund, Inc. held of record by the
undersigned on October 1, 1997, at the annual meeting of shareholders to be held
on November 20, 1997 or any adjournment(s) thereof.
1. ELECTION OF DIRECTORS
FOR all nominees listed below
(except as marked to the contrary below) / /
WITHHOLD AUTHORITY
to vote for all nominees listed below / /
Kenneth P. Liesegang (Class I Director), Brad
Orvieto (Class II Director), Bruno A. Sniders
(Class III Director), Donald R. Chambers (Class IV
Director), George W. Karpus (Class V Director).
(INSTRUCTION: To withhold authority to vote for any individual nominee write
that nominee's name on the space provided below.)
<PAGE>
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting. This proxy when
properly executed will be voted in the manner directed herein by the
undersigned stockholder. If no direction is made, this proxy will be
voted for Proposal 1.
Please sign exactly as name appears below. When shares are held by
joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If
a corporation, please sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership name
by authorized person.
DATED:______________, 1997 ---------------------------
Signature
---------------------------
Signature, if held jointly
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PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
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