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As filed with the U.S. Securities and Exchange Commission
on November 18, 1997
Securities Act File No. 333-29253
Investment Company Act File No. 811-08253
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [x]
Pre-Effective Amendment No. 1 [x]
Post-Effective Amendment No. [ ]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [x]
Amendment No. 1 [x]
(Check appropriate box or boxes)
Boyar Value Fund, Inc.
..............................................................................
(Exact Name of Registrant as Specified in Charter)
590 Madison Avenue
New York, New York 10022
..............................................................................
(Address of Principal Executive Office) (Zip Code)
Registrant's Telephone Number, including Area Code:
(212) 409-2000
Mr. Jay R. Petschek
Boyar Value Fund, Inc.
590 Madison Avenue
New York, New York 10022
.........................................
(Name and Address of Agent for Service)
Copy to:
Daniel Schloendorn, Esq.
Willkie Farr & Gallagher
One Citicorp Center
153 East 53rd Street
New York, New York 10022-4677
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Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of this Registration Statement.
CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933
Proposed
Title of Proposed Maximum
Securities Maximum Aggregate Amount of
Being Amount Being Offering Price Offering Registration
Registered Registered per Unit Price Fee
- ---------- ------------- --------------- ---------- -------------
Shares of common
stock, $.001 par
value per share Indefinite* Indefinite* $0
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* An indefinite number of shares of common stock of the Registrant is
being registered by this Registration Statement pursuant to Rule 24f-2
under the Investment Company Act of 1940, as amended (the "1940 Act").
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, as amended (the "1933 Act"), or until the
Registration Statement shall become effective on such date as the Commission,
acting pursuant to said Section 8(a), may determine.
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BOYAR VALUE FUND, INC.
FORM N-1A
CROSS REFERENCE SHEET
Part A
Item No. Prospectus Heading
- -------- -------------------------------
1. Cover Page.............................. Cover Page
2. Synopsis................................ The Funds' Expenses
3. Condensed Financial Information......... Financial Highlights
4. General Description of Registrant....... Cover Page; Investment Objective
and Policies; Certain Securities
and Investment Techniques; Risk
Factors and Special
Considerations; Additional
Information
5. Management of the Fund.................. Management of the Fund
6. Capital Stock and Other Securities...... Additional Information
7. Purchase of Securities
Being Offered........................... How Net Asset Value is
Determined; How to Purchase
Shares
8. Redemption or Repurchase................ How to Redeem Shares
9. Pending Legal Proceedings............... Not applicable
Part B Heading for the Statement
Item No. of Additional Information
- --------------------------------------- -------------------------------
10. Cover Page............................. Cover Page
11. Table of Contents...................... Contents
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12. General Information and History.......... Management of the Fund;
See Prospectus--
"Additional Information"
13. Investment Objective and Policies........ Investment Objective;
Investment Policies
14. Management of the Registrant............. Management of the Fund; See
Prospectus--"Management of
the Fund"
15. Control Persons and Principal Holders
of Securities............................ Management of the Fund; See
Prospectus--"Management of
the Fund"
16. Investment Advisory and Other Services... Management of the Fund; See
Prospectus--"Management of
the Fund"
17. Brokerage Allocation..................... Investment Policies;
Portfolio Transactions
18. Capital Stock and Other Securities....... Management of the Fund--
Organization of the Fund;
See Prospectus--"Additional
Information"
19. Purchase, Redemption and Pricing of
Securities Being Offered................. Additional Purchase and
Redemption Information; See
Prospectus--"How to Purchase
Shares", "How to Redeem
Shares" and "How Net Asset
Value is Determined"
20. Tax Status............................... Additional Information
Concerning Taxes; See
Prospectus--"Dividends,
Distributions and Taxes"
21. Underwriters............................. Investment Policies; See
Prospectus--"Management of
the Fund"
22. Calculation of Performance Data.......... Determination of Performance
23. Financial Statements..................... Statement of Assets and
Liabilities; Report of Ernst
& Young LLP, Independent
Accountants
Part C
- ------
Information required to be included in Part C is set forth after the
appropriate item, so numbered, in Part C to this Registration Statement.
2
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT
BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO
SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE
ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR
SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE
SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
Subject to completion, dated November 18, 1997
PROSPECTUS _____________, 1997
BOYAR VALUE FUND, INC.
590 Madison Avenue, New York, NY 10022
Boyar Value Fund, Inc. (the "Fund") is a no load mutual fund that seeks
long-term capital appreciation, which it pursues by investing primarily in
equity securities of companies that are believed by the Fund's investment
adviser to be intrinsically undervalued.
Investment advisory services for the Fund are provided by Boyar Asset
Management, Inc. (the "Adviser") and the Fund is managed by Ladenburg Thalmann
Fund Management Inc. (the "Manager").
This Prospectus briefly sets forth certain information about the Fund that
investors should know before investing. Investors are advised to read this
Prospectus carefully and retain it for future reference.
Additional information about the Fund, contained in a Statement of Additional
Information, has been filed with the Securities and Exchange Commission ("SEC")
in a document entitled "Statement of Additional Information" and is available
for reference, along with other related materials, on the SEC Internet Web site
(http://www.sec.gov). The Statement of Additional Information is also available
upon request and without charge by calling the Fund at 1-800-266-5566.
Information regarding the status of shareholder accounts may also be obtained by
calling the Fund at the same number. The Fund maintains a Web site at
www.boyarvalue.com. The Statement of Additional Information bears the same date
as this Prospectus and is incorporated by reference into this Prospectus.
Shares of the Fund are not deposits or obligations of or guaranteed or endorsed
by any bank, and shares are not insured by the Federal Deposit Insurance
Corporation, the Federal Reserve Board or any other government agency.
Investments in shares of the Fund involve investment risks, including the
possible loss of the principal amount invested.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
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CONTENTS
THE FUND'S EXPENSES........................................................3
INVESTMENT OBJECTIVE AND POLICIES..........................................4
CERTAIN SECURITIES AND INVESTMENT TECHNIQUES...............................9
RISK FACTORS AND SPECIAL CONSIDERATIONS...................................12
MANAGEMENT OF THE FUND....................................................14
HOW TO PURCHASE SHARES....................................................17
HOW TO REDEEM SHARES......................................................20
HOW NET ASSET VALUE IS DETERMINED.........................................22
DIVIDENDS, DISTRIBUTIONS AND TAXES........................................23
ADDITIONAL INFORMATION....................................................25
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, THE STATEMENT OF
ADDITIONAL INFORMATION OR THE FUND'S OFFICIAL SALES LITERATURE IN CONNECTION
WITH THE OFFERING OF THE FUND'S SHARES AND, IF GIVEN OR MADE, SUCH OTHER
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED ON AS HAVING BEEN AUTHORIZED
BY THE FUND. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH,
OR TO ANY PERSON TO WHOM, SUCH OFFER MAY NOT LAWFULLY BE MADE.
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THE FUND'S EXPENSES
The following table lists the costs that an investor will incur, either
directly or indirectly, as a shareholder of the Fund, based upon the Fund's
projected annual operating expenses:
Shareholder Transaction Expenses
Maximum sales charge imposed on purchases of
share (as a percentage of offering price)...................... None
Redemption Fee................................................... None(1)
Annual Operating Expenses (as percentage of
average net assets)
Management and advisory fees..................................... 1.00%
12b-1 fees (distribution and service fees)(2).................... .25%
Other expenses (after expense reimbursements)(3)................. .50%
Total Fund Operating Expenses (after expense
reimbursements)(2)............................................... 1.75%
__________________
(1) A wire transfer fee is charged by the Fund's custodian in the case of
redemptions made by wire. Such fee is subject to change and is currently $8.
(2) The Fund bears an annual Rule 12b-1 service fee of .25% of the value of the
average daily net assets. Long-term shareholders may pay more than the economic
equivalent of the maximum front-end sales loads permitted by the National
Association of Securities Dealers.
(3) The Manager and the Adviser are voluntarily absorbing any expenses that
would cause all "Other expenses" to exceed .50%. It is currently anticipated
that this arrangement will continue until further notice to shareholders. Based
on the Fund's projected annualized average net assets, if these expenses are not
absorbed, "Other expenses" would be 1.20% and "Total Fund Operating Expenses"
would be 2.45%.
The nature of the services for which the Fund pays management and
advisory fees is described below under "Management of the Fund." The percentage
of "Other expenses" in the table above is based on annualized estimates of
expenses for the Fund's initial fiscal year and includes fees for shareholder
services, custodial fees, legal and accounting fees and registration fees, net
of expense reimbursements.
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Example
The following example demonstrates the projected dollar amount of total
cumulative expenses that would be incurred over various periods with respect to
a hypothetical $1,000 investment in the Fund assuming (1) a 5% annual return,
(2) payment of the shareholder transaction expenses and annual Fund operating
expenses set forth in the table above and (3) complete redemption at the end of
the period.
1 Year 3 Years
------ -------
$18.38 $56.90
The above example is intended to assist an investor in understanding
various costs and expenses that the investor would bear upon becoming a
shareholder of the Fund. The example should not be considered to be a
representation of past or future expenses. Actual expenses of the Fund may be
greater or less than those shown above. The assumed 5% annual return shown in
the example is hypothetical and should not be considered to be a representation
of past or future annual return; the actual return of the Fund may be greater or
less than the assumed return.
INVESTMENT OBJECTIVE AND POLICIES
IN GENERAL
The investment objective of the Fund is long-term capital appreciation,
which it pursues by investing primarily in equity securities which are believed
by Boyar Asset Management, Inc. (the "Adviser") to be intrinsically undervalued.
The Fund seeks to achieve its investment objective by investing substantially
all, but under normal market conditions no less than 65 percent, of its total
assets in equity securities, including common stock, preferred stock or
securities convertible into or exchangeable for common stock. It is anticipated
that the equity securities in which the Fund will invest will be traded on
domestic and foreign securities exchanges or on the over-the-counter markets.
The Fund may also make temporary investments in investment grade corporate debt
obligations and U.S. Government securities for defensive purposes when it
believes market conditions warrant and as a cash management technique. See
"Temporary Investments." In addition, the Fund may engage in securities lending
transactions in order to generate income to cover Fund expenses. See "Lending of
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Securities." The Fund's investment objective may not be changed without
shareholder approval. There is no assurance that the Fund's investment objective
will be achieved.
Because the Fund will invest primarily in equity securities, it will be
subject to general conditions prevailing in securities markets and the net asset
value of the Fund's shares will fluctuate with changes in the market prices of
its portfolio securities.
INVESTMENT STRATEGY
The Adviser seeks out intrinsically undervalued corporations and
purchases their shares at low prices relative to their perceived inherent worth.
This can lead to the potential for significant capital appreciation. The
intrinsic value of a corporation is the estimated current worth that would
accrue to the stockholders of a company, either through liquidation of corporate
assets upon termination of operations, or through the sale or merger of the
entire enterprise as a continuing business. In the Adviser's opinion, within an
investment time horizon of three to five years, typically either the stock
market will accurately reflect a corporation's intrinsic value or the assets of
the corporation will be acquired by a third party. From 1975 through June 5,
1997, approximately 43% of the corporations that the chief investment officer of
the Adviser, Mr. Mark A. Boyar, has extensively researched and written in-depth
research reports about in his Asset Analysis Focus research service ("Asset
Analysis Focus") have been acquired or liquidated (i.e., the assets were sold to
a third party and the proceeds of the sale were distributed to the shareholders)
at a premium to the price of the company's shares at the time the initial
research report appeared in Asset Analysis Focus.
This investment strategy reflects the determination to grow capital and
maintain purchasing power by holding stocks for the long term. A long-term
orientation may sound stodgy, but this approach is as important to investment
success as picking the right stocks at the right price and at the right time.
Holding the equity of good companies purchased at bargain prices allows
compounding to work without the return-eroding effects of commissions and
capital gains taxes. Buying and holding stocks not only postpones the payment of
capital gains taxes but there are also added positive effects on the compounding
rate. The Adviser believes that by reducing the number of transactions generated
by profit taking, all the money invested is still working for a better return
until the future tax liability is incurred. The Adviser currently plans to
report the Fund's performance returns on a pre-tax basis and on an after-tax
basis to better evidence the advantages of this strategy. The
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methodology for calculating after-tax returns is described in the Statement of
Additional Information.
To hasten the recognition factor of an intrinsically undervalued
corporation's shares in the marketplace, the Adviser also looks for companies
that have some type of catalyst or trigger, for example: a corporation that has
undergone or is about to undergo an asset redeployment program, resulting in
potentially greater return on assets; a company whose chief operating officer
and major stockholder is relatively old and has no heir to take over the company
upon his death or retirement; or a corporation that is engaged in more than one
business, with the possibility that the second business might be spun off to the
existing shareholders. The Adviser generally will avoid investing in
corporations whose shares are widely held by institutions or closely followed by
investment analysts, because the likelihood of a great disparity between stock
market value and intrinsic value is remote.
At the time of the purchase of the corporation's shares, the Adviser
determines the value of all of the assets and liabilities of the corporation and
thereby establishes a potential selling price for the corporation's common
stock. The Adviser reviews the company's asset base from time to time
(especially when the common stock of a corporation nears its sell price target),
to carefully determine if something has changed to alter its opinion -- if not,
the security is sold when it meets its fully valued price.
The Adviser may alternatively sell covered call options or buy put
options with exercise prices at a stock's sell target price, although it is not
anticipated that the value of the underlying securities on which covered call
and put options will be written or purchased will exceed 5% of the Fund's total
assets in the foreseeable future. See "Stock Options and Currency Exchange
Transactions" in the Statement of Additional Information.
The Adviser employs a variety of different investment strategies to
uncover investment opportunities for the Fund, including the following:
1. Hidden Assets
"Hidden" assets are assets whose current values are undervalued on a
corporation's financial statements -- a situation which may lead to a disparity
between market value and intrinsic worth. Hidden assets include real estate --
buildings and undeveloped acreage, reserves of natural resources -- coal, gas,
oil and timber, cellular or cable franchises and inventory
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reserves resulting from the last-in-first-out method of inventory accounting.
The Adviser adjusts the value of these assets to their current market value to
calculate the intrinsic worth of the corporation, which may be much higher than
the value the stock market accords them.
2. Underpriced Businesses
Excessive pessimism about a particular industry or a specific company
may result in extreme disparities between the stock market value of a
corporation and the price that would be placed upon the company if the entire
enterprise were acquired by a knowledgeable private investor. When employing
this method of valuation, the Adviser considers the subject corporation's
historical earning power, present product mix and financial strength as well as
the prices at which similar corporations have been acquired in the recent past.
The Adviser's findings help place an appropriate value on the shares of the
subject company.
3. Undervalued Franchises
A number of corporations have, over time, created valuable consumer
franchises. Their products are recognized easily by consumers around the world.
Such franchises are virtually impossible for a potential competitor to
duplicate. These "franchise" corporations often can raise prices or even charge
a premium for their products or services without losing market share. The value
of this competitive advantage may not be adequately reflected in the price of
the company's shares.
4. Selling For Less Than Net Working Capital
The minimum liquidation value of a corporation is, in most instances,
its net working capital value. This amount is determined by subtracting from
current assets all liabilities senior to the common stock, including current
liabilities, long term debt, preferred stock, capitalized lease obligations and
certain pension liabilities. The stock market will, at pessimistic extremes,
value individual securities at a discount to their net working capital on a per
share basis. Investments made at these levels provide an opportunity to purchase
securities below their liquidating value and acquire the pro-rata value of
property, plant and equipment at zero cost.
5. "Fallen Angels"
Well known corporations that were once the "darlings" of Wall Street,
may fall out of favor with the investment community, causing their stock prices
to plummet to unrealistically low levels. The Adviser may purchase shares of
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such companies if it determines that the fundamentals of such a concern are not
permanently impaired.
6. Restructuring Plays, Breakups and Spin-offs
A company interested in enhancing shareholder value may spin off a
portion of its assets to current stockholders through the creation of a new
public entity. The common stock of the newly spun-off company often trades
temporarily at a substantial discount to its underlying net asset value. This is
in part because this new entity is not immediately followed by Wall Street
analysts. However, the newly focused "pure play" companies often perform well
and soon receive more coverage than they ever would have as one ungainly and
difficult to analyze conglomerate.
7. Bankruptcies
An over-leveraged company that declares bankruptcy can purge itself of
excess debt and then emerge as a more competitive enterprise. The stigma of
bankruptcy, however, can sometimes depress the stock prices of those companies
to bargain levels.
8. Under-Followed Companies
The Adviser normally invests in the equity of corporations not widely
held by institutions or closely followed by other investment analysts. The
Adviser believes that this is the area where the stock market is most
inefficient in providing investors the opportunity to find unrecognized values.
High-profile, popular companies are monitored carefully and consistently by
portfolio managers and investment analysts. The likelihood of a profitable
disparity developing between the stock market values and the intrinsic values of
these businesses is remote.
9. Low Price to Earnings Ratios
The Adviser believes that the risk inherent in the stock selection
process can be reduced by purchasing common equity at price to earnings ratios
that are low relative to those that prevail in the general stock market.
Earnings disappointments rarely hurt low price to earnings common stocks for
long periods of time. On the other hand, positive earnings surprises usually
result in an increase of the price to earnings ratio.
10. Large Free Cash Flows
The Adviser favors companies that generate significantly more cash than
they need to finance day-to-day
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operations. Such companies can use this excess cash to repurchase their own
shares, increase dividends or make acquisitions.
11. Insider Ownership
The Adviser will take positions in the common equity of corporations
whose executives buy and hold large amounts of the company's stock. Significant
insider ownership of a corporation's shares indicates that the interests of the
executives and managers who own those shares are aligned with the interests of
other shareholders and they have a powerful incentive to work for the company's
long-term success. On the other hand, insignificant insider ownership can
depress the shares of an otherwise good company because its managers own too
little equity in the business to care much about maximizing shareholder value.
The Adviser evaluates investments in companies with extreme positions of insider
ownership - significant or insignificant - to aid in determining a company's
intrinsic value. Excessive non-stock and non-performance related compensation
for a company's top officers can also depress the shares of an otherwise good
company. The Adviser will not hesitate to assert its weight as a shareholder of
a business that is poorly managed.
In making investment selections, the Fund also focuses on certain
fundamental financial characteristics of a company, including debt to capital
ratios and the market capitalization of small-, medium- and large-sized
companies. The Fund has no policy regarding the minimum or maximum market
capitalization of companies in which it may invest.
CERTAIN SECURITIES AND INVESTMENT TECHNIQUES
PORTFOLIO TRANSACTIONS
All orders for transactions in securities and options on behalf of the
Fund are placed with broker-dealers selected by the Adviser. Affiliates of the
Manager or the Adviser may serve as the Fund's broker in effecting portfolio
transactions on national securities exchanges and retain commissions in
accordance with certain regulations of the SEC. In addition, the Adviser may
select broker-dealers that provide it with research services and may cause the
Fund to pay these broker-dealers commissions that exceed those that other
broker-dealers may have charged, if it views the commissions as reasonable in
relation to the value of the brokerage and/or research services received.
FOREIGN SECURITIES
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Although the Fund will invest primarily in domestic securities, and has
no present intention of investing any significant portion of its assets in
foreign securities, it reserves the right to invest in foreign securities if the
purchase thereof at the time of purchase would not cause more than 15 percent of
the value of the Fund's total assets to be invested in foreign securities. See
"Foreign Securities" below.
TEMPORARY INVESTMENTS
The Fund has adopted a temporary defensive investment policy, which
permits the Fund to deviate temporarily from fundamental and non-fundamental
investment policies, without a shareholder vote or without prior contemporaneous
notification to shareholders, when significant adverse market, economic,
political or other circumstances require immediate action to avoid loss. The
Fund may invest up to 35 percent of its total assets and, when the Adviser
believes market conditions warrant a temporary defensive position, up to 100
percent of its total assets in corporate bonds rated at least Baa by Moody's
Investors Service, Inc. ("Moody's") or BBB by Standard & Poor's Ratings Services
("S&P"), commercial paper rated at least Prime-2 by Moody's or A-2 by S&P and
obligations issued or guaranteed by the U.S. Government or by its agencies or
instrumentalities or in repurchase agreements for any of the foregoing.
Obligations of certain agencies and instrumentalities of the U.S. Government,
such as the Government National Mortgage Association, are supported by the "full
faith and credit" of the U.S. Government; others, such as those of the Federal
National Mortgage Association, are supported by the discretionary authority of
the U.S. Government to purchase the agency's obligations; and still others, such
as those of the Export-Import Bank of the U.S., are supported by the right of
the issuer to borrow from the U.S. Treasury; and still others, such as those of
the Student Loan Marketing Association, are supported only by the credit of the
instrumentality. No assurance can be given that the U.S. Government would
provide financial support to U.S. Government-sponsored instrumentalities if it
is not obligated to do so by law. Bonds rated Baa by Moody's and BBB by S&P,
while considered "investment grade" obligations, may have speculative
characteristics.
REPURCHASE AGREEMENTS
The Fund may invest in repurchase agreement transactions with member
banks of the Federal Reserve System and certain non-bank dealers. Repurchase
agreements are contracts under which the buyer of a security simultaneously
commits to resell the security to the seller at an agreed-upon price and date.
Under the terms of a typical repurchase agreement, the
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Fund would acquire any underlying security for a relatively short period
(usually not more than one week) subject to an obligation of the seller to
repurchase, and the Fund to resell, the obligation at an agreed-upon price and
time, thereby determining the yield during the Fund's holding period. This
arrangement results in a fixed rate of return that is not subject to market
fluctuations during the Fund's holding period. The value of the underlying
securities will at all times be at least equal to the total amount of the
purchase obligation, including interest. The Fund bears a risk of loss in the
event that the other party to a repurchase agreement defaults on its obligations
or becomes bankrupt and the Fund is delayed in or prevented from exercising its
right to dispose of the collateral securities, including the risk of a possible
decline in the value of the underlying securities during the period while the
Fund seeks to assert this right. The Adviser, acting under the supervision of
the Fund's Board of Directors (the "Board"), monitors the creditworthiness of
those bank and non-bank dealers with which the Fund enters into repurchase
agreements to evaluate this risk. A repurchase agreement is considered to be a
loan under the Investment Company Act of 1940, as amended (the "1940 Act").
LENDING OF SECURITIES
The Fund may lend its portfolio securities to broker-dealers and other
financial institutions pursuant to agreements requiring that the loans be
continuously secured by cash, letters of credit or U.S. Government securities of
a value equal to at least the fair market value of the securities lent. These
loans will not be made if as a result the aggregate of all outstanding loans
exceeds 30 percent of the value of the Fund's total assets taken at current
value.
STOCK OPTIONS
To hedge against adverse market shifts, the Fund may purchase put
options on securities held in its portfolio. The Fund may also seek to increase
its income or may hedge a portion of its portfolio investments through writing
(that is, selling) "covered" call options. As the holder of a put option, the
Fund will have the right to sell the securities underlying the option and as the
writer (seller) of a call option, the Fund will have the obligation to sell the
securities underlying the option, in each case at the option's exercise price at
any time prior to, or on, the option's expiration date. A covered call option
contemplates that, for so long as the Fund is obligated as the writer of the
option, it will own (1) the underlying securities subject to the option or (2)
securities convertible into, or exchangeable without the payment of any
consideration for, the securities subject to the option. The value of the
underlying
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securities on which covered call and put options will be written or purchased at
any one time by the Fund is not anticipated to exceed 5 percent of the Fund's
total assets.
The Fund may choose to exercise the options it holds, permit them to
expire or terminate them prior to their expiration by entering into closing sale
or purchase transactions. In entering into a closing transaction, the Fund would
sell or purchase an option of the same series as the one it has written or
purchased, respectively. See "Stock Options and Currency Exchange Transactions"
in the Statement of Additional Information.
INVESTMENT RESTRICTIONS
In order to limit investment risk, the Fund has adopted certain
investment restrictions that are changeable only by shareholder vote. These
restrictions, among other things, prohibit the Fund from: purchasing securities
of any issuer, other than U.S. Government securities, if the purchase would
cause more than 5 percent of the Fund's total assets, taken at market value, to
be invested in the securities of that issuer, except that 25 percent of the
Fund's assets may be invested without regard to this limit; purchasing more than
10 percent of the voting securities of any issuer, except that 25 percent of the
Fund's assets may be invested without regard to this limit; purchasing
securities on margin; borrowing money or mortgaging or hypothecating the Fund's
assets, although the prohibition against borrowing does not prohibit limited
short-term borrowings to meet redemption requests and the prohibition against
mortgaging or hypothecating assets does not prohibit escrow arrangements
contemplated by writing covered call options; and concentrating more than 25
percent of the Fund's total assets in any one industry. In addition, it is
anticipated that the Fund will not invest more than 15 percent of the Fund's net
assets in restricted or illiquid securities, including securities that are not
readily marketable. This last restriction may be changed by the Fund's Board.
RISK FACTORS AND SPECIAL CONSIDERATIONS
EQUITY FLUCTUATION
Because the major portion of the Fund's portfolio consists of common
stocks, it may be expected that its net asset value will be subject to greater
fluctuation than a portfolio containing mostly fixed income securities.
FOREIGN SECURITIES
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Foreign securities present special considerations not typically
associated with investments in domestic securities. Foreign taxes may reduce
income. Currency exchange rates and regulations may cause fluctuations in the
value of foreign securities. Foreign securities are subject to different
regulatory environments than in the United States and, compared to the United
States, there may be a lack of uniform accounting, auditing and financial
reporting standards, less volume and liquidity and more volatility, less public
information and less regulation of foreign issuers. Countries have been known to
expropriate or nationalize assets, and foreign investments may be subject to
political, financial or social instability or adverse diplomatic developments.
There may be difficulties in obtaining service of process on foreign issuers and
difficulties in enforcing judgments with respect to claims under the U.S.
securities laws against these issuers. Favorable or unfavorable differences
between U.S. and foreign economies could affect foreign securities values. The
U.S. Government has, in the past, discouraged certain foreign investments by
U.S. investors through taxation or other restrictions and it is possible that
such restrictions could be imposed again.
STOCK OPTIONS
The Fund will receive a premium when it writes call options, which
increases the Fund's return on the underlying security in the event the option
expires unexercised or is closed out at a profit. By writing a call, the Fund
will limit its opportunity to profit from an increase in the market value of the
underlying security above the exercise price of the option for as long as the
Fund's obligation as writer of the option continues. Thus, in some periods, the
Fund will receive less total return and in other periods greater total return
from its hedged positions than it would have received from its underlying
securities if unhedged.
In purchasing a put option, the Fund will seek to benefit from a
decline in the market price of the underlying security. If a put option
purchased is not sold or exercised when it has remaining value, or if the market
price of the underlying security remains equal to or greater than the exercise
price, during the life of the option, the Fund will lose its investment in the
option. For the purchase of a put option to be profitable, the market price of
the underlying security must decline sufficiently below the exercise price to
cover the premium and transaction costs. Because option premiums paid by the
Fund are small in relation to the market value of the investments underlying the
options, buying options can result in large amounts of leverage. The leverage
offered by trading in options could cause the Fund's net asset value to be
subject to
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more frequent and wider fluctuations than would be the case if the Fund did not
invest in options.
SMALL- AND MEDIUM-SIZED COMPANIES
There is no minimum or maximum market capitalization of the companies
in which the Fund may invest. Investing in securities of small- and medium-sized
companies may involve greater risks since these securities may have limited
marketability and, thus, may be more volatile than securities of larger, more
established companies or the market in general. Because small- and medium-sized
companies normally have fewer shares outstanding than larger companies, it may
be more difficult for the Fund to buy or sell significant amounts of these
shares without an unfavorable impact on prevailing prices. Small-sized companies
may have limited product lines, markets or financial resources and may lack
management depth. In addition, small- and medium-sized companies are typically
subject to a greater degree of changes in earnings and business prospects than
are larger, more established companies. There is typically less publicly
available information concerning small- and medium-sized companies than for
larger, more established ones. Although investing in securities of small- and
medium-sized companies offers potential for above-average returns if the
companies are successful, the risk exists that such companies will not succeed
and the prices of their shares could significantly decline in value.
RELATED TRANSACTIONS
The Fund is expected to purchase securities that have been recommended
by Asset Analysis Focus (the research service affiliated with the Adviser).
However, the Fund will acquire new recommendations made by Asset Analysis Focus
no earlier than five Business Days after publication of Asset Analysis Focus.
The Fund may also purchase shares in combination with other accounts managed by
the Adviser. These practices may have an impact on the price and availability of
the securities to be purchased by the Fund.
MANAGEMENT OF THE FUND
BOARD OF DIRECTORS
The overall management of the business and affairs of the Fund
are managed under the direction of its Board of Directors. The Directors, who
are identified in the Statement of Additional Information, approve all
significant agreements between the Fund and the persons that furnish services to
the Fund, including the agreements with the Manager, the Adviser, the
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Fund's distributor, custodian and administrator and transfer agent. As the
Fund's Manager, Ladenburg Thalmann Fund Management Inc. is responsible for the
day-to-day business operations of the Fund.
MANAGER
The Manager is located at 590 Madison Avenue, New York, New York 10022.
The Manager is owned by Ladenburg Thalmann Asset Management Inc.
Pursuant to a Management Agreement with the Fund, the Manager, under
the supervision of the Board of Directors, oversees the daily operations of the
Fund, supervises the performance of administrative and professional services
provided by others, including the Adviser. As compensation for its services and
the related expenses borne by the Manager, the Fund pays the Manager a fee,
computed daily and payable monthly, at the annual rate of .50 of one percent of
the Fund's average daily net assets. The Manager may voluntarily waive all or a
portion of its fees from time to time and in its discretion reimburse expenses
to be paid by the Fund.
INVESTMENT ADVISER
The Adviser is an investment adviser and broker-dealer registered with
the SEC. The Adviser's principal address is 35 East 21st Street, New York, New
York 10010.
Pursuant to the Investment Advisory Agreement among the Manager, the
Adviser and the Fund, the Adviser has agreed to furnish continuous investment
advisory services to the Fund. Subject to the supervision and direction of the
Fund's Board of Directors, the Adviser manages the Fund's portfolio in
accordance with the stated policies of the Fund. The Adviser makes investment
decisions for the Fund and places the purchase and sale orders for portfolio
transactions. For the services provided pursuant to the Investment Advisory
Agreement, the Fund pays the Adviser a fee, computed daily and payable monthly,
at the annual rate of .50 of one percent of the Fund's average daily net assets.
The Adviser may voluntarily waive all or a portion of its fees from time to time
and in its discretion reimburse expenses to be paid by the Fund.
Mark A. Boyar is the chief investment officer of the Fund, and will be
primarily responsible for the day-to-day management to the Fund's portfolio. Mr.
Boyar, the President of Mark Boyar & Company Inc. (a broker dealer), has also
been the President of the Adviser since 1983. Mark Boyar & Company Inc.
publishes Asset Analysis Focus, an institutionally oriented
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research service that focuses on uncovering intrinsically undervalued
corporations for investment and merger and acquisition activity.
ADMINISTRATOR
Countrywide Fund Services, Inc., P.O. Box 5354, Cincinnati, Ohio
45201-5354, serves as the Fund's administrator and accounting, transfer,
dividend disbursing, shareholder service and plan agent (the "Administrator").
The Administrator is a wholly-owned indirect subsidiary of Countrywide Credit
Industries, Inc., a New York Stock Exchange listed company principally engaged
in the business of residential mortgage lending.
Pursuant to the Administration Agreement, the Accounting Services
Agreement and the Transfer, Dividend Disbursing, Shareholder Service and Plan
Agency Agreement, the Administrator furnishes the Fund's accounting, data
processing, internal auditing and other services required by the Fund; prepares
reports to shareholders of the Fund and reports to and filings with the SEC and
state Blue Sky authorities; and calculates the net asset value of shares of the
Fund. For administrative services provided pursuant to the Administration
Agreement, the Fund pays the Administrator a monthly fee, calculated at an
annual rate as a percentage of the Fund's average daily net assets, of .150% for
the first $50 million, .125% for the next $50 million and .100% for over $100
million of average daily net assets. The monthly fee for administrative services
is subject to a $1,000 minimum charge. For accounting services provided pursuant
to the Accounting Services Agreement, the Fund pays the Administrator a monthly
fee of $2,000 for up to $50 million, $2,500 for $50 million to $100 million,
$3,000 for $100 million to $200 million, $4,000 for $200 million to $300 million
and $5,000 for over $300 million of average net assets of the Fund during the
month. For the performance of transfer agent services by the Administrator
(including transfer, dividend disbursing, shareholder service and plan agent
services provided pursuant to the Transfer, Dividend Disbursing, Shareholder
Service, and Plan Agency Agreement) the Fund pays the Administrator an annual
per account charge of $18. This fee is paid monthly and is subject to a $1,200
monthly minimum charge.
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DISTRIBUTOR
Ladenburg Thalmann & Co. Inc. (the "Distributor") acts as distributor
of the Fund's shares. The Distributor's principal address is 590 Madison Avenue,
New York, New York 10022.
The Distributor is a member of the NASD and of the New York, American
and other principal national securities exchanges. The Distributor is paid
monthly fees by the Fund in connection with the servicing of shareholder
accounts. A monthly service fee, authorized pursuant to a Shareholder Servicing
and Distribution Plan (the "Plan") adopted by the Fund pursuant to Rule 12b-1
under the 1940 Act, is calculated at the annual rate of .25% of the value of the
average daily net assets of the Fund and is used by the Distributor to provide
compensation for ongoing servicing and/or maintenance of shareholder accounts
with the Fund. Compensation is paid by the Distributor to persons, including
employees of the Distributor, who respond to inquiries of shareholders of the
Fund regarding their ownership of shares or their accounts with the Fund or who
provide other similar services not otherwise required to be provided by the
Fund's Adviser, Administrator or other agent of the Fund.
Payments under the Plan are not tied exclusively to the service
expenses actually incurred by the Distributor, and the payments may exceed
expenses actually incurred by the Distributor. The Board of Directors evaluates
the appropriateness of the Plan and its payment terms on a continuing basis and
in doing so considers all relevant factors, including expenses borne by the
Distributor and amounts it receives under the Plan.
Under its terms, the Plan continues from year to year, so long as its
continuance is approved annually by vote of the Board of Directors, including a
majority of the Directors who are not interested persons of the Fund and who
have no direct or indirect financial interest in the operation of the Plan (the
"Independent Directors"). The Plan may not be amended to increase materially the
amount to be spent for the services provided by the Distributor without
shareholder approval, and all material amendments of the Plan also must be
approved by the Directors in the manner described above. The Plan may be
terminated at any time, without penalty, by vote of a majority of the
Independent Directors or by a vote of a majority of the outstanding voting
securities (as defined in the 1940 Act) on not more than 30 days' written notice
to the Distributor.
Pursuant to the Plan, the Distributor will provide the Board of
Directors with periodic reports of amounts expended under the Plan and the
purpose for which the expenditures were
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made. The Directors believe that the Fund's expenditures under the Plan will
benefit the Fund and its shareholders by providing better shareholder services.
CUSTODIAN
Star Bank, N.A. (the "Custodian") acts as custodian of the Fund's
investments. The Custodian's principal address is 425 Walnut Street, Cincinnati,
Ohio.
Pursuant to the Custody Agreement, the Custodian acts as the Fund's
depository, safekeeps its portfolio securities, collects all income and other
payments with respect thereto, disburses funds as instructed and maintains
records in connection with its duties.
EXPENSES OF THE FUND
In addition to the fees paid to the Adviser and the Manager, operating
expenses for the Fund generally consist of fees of the Administrator and other
Fund expenses, which include, among others, the fees and expenses, if any, of
the Directors and officers for attending meetings of the Board of Directors,
fees of the Fund's Custodian, interest expense, taxes, brokerage fees and
commissions, fees and expenses of the Fund's shareholder servicing operations,
fees and expenses of qualifying and registering the Fund's shares under Federal
and state securities laws, expenses of preparing, printing and distributing
prospectuses and reports to existing shareholders, auditing and legal expenses,
insurance expenses, association dues, and the expense of shareholders' meetings
and proxy solicitations. The Fund is also liable for any non-recurring expenses
that may arise such as litigation to which the Fund may be a party. The Fund may
be obligated to indemnify the Board of Directors and officers with respect to
such litigation. All expenses of the Fund are accrued daily on the books of the
Fund at a rate which is equal to the actual expenses expected to be incurred by
the Fund in accordance with generally accepted accounting principles. From time
to time, the Manager and the Adviser, in their discretion and as they deem
appropriate, may waive a portion or all of the fees payable to them by the Fund.
HOW TO PURCHASE SHARES
There are no sales commissions charged to investors. Assistance in
opening accounts may be obtained from the Administrator by calling
1-800-266-5566, or by writing to the Fund at the address shown below for regular
mail orders. Assistance is also available through any broker-dealer authorized
to sell shares of the Fund. Such broker-dealer may charge you a
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fee for its services. Payment for shares purchased may be made through your
account at the broker-dealer processing your application and order to purchase.
Your investment will purchase shares at the Fund's net asset value next
determined after your order is received by the Fund in proper order as indicated
herein. The minimum initial investment in the Fund, unless stated otherwise
herein, is $5,000. The Fund may, in the Adviser's sole discretion, accept
certain accounts with less than the stated minimum initial investment.
Payment must be made by check or money order drawn on a U.S. bank and
payable in U.S. dollars. All orders received by the Administrator, whether by
mail, bank wire or facsimile order from a qualified broker-dealer, prior to 4:00
p.m., Eastern time, will purchase shares at the net asset value next determined
on that business day. If your order is not received by 4:00 p.m., Eastern time,
your order will purchase shares at the net asset value determined on the next
business day. See "How Net Asset Value is Determined".
Due to Internal Revenue Service ("IRS") regulations, applications
without social security or tax identification numbers will not be accepted. If,
however, you have already applied for a social security or tax identification
number at the time of completing your account application, the application
should so indicate. The Fund is required to, and will, withhold taxes on all
distributions and redemption proceeds if the number is not delivered to the Fund
within 60 days.
Investors should be aware that the Fund's account application contains
provisions in favor of the Fund, the Administrator and certain of their
affiliates, excluding such entities from certain liabilities (including, among
others, losses resulting from unauthorized shareholder transactions) relating to
the various services made available to investors.
Should an order to purchase shares be canceled because your check does
not clear, you will be responsible for any resulting losses or fees incurred by
the Fund or the Administrator in the transaction.
Regular Mail Orders. Please complete and sign the Account Application
form accompanying this Prospectus and send it with your check, made payable to
Boyar Value Fund, Inc. and mail it to:
Boyar Value Fund, Inc.
c/o Shareholder Services
P.O. Box 5354
Cincinnati, Ohio 45201-5354
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Bank Wire Orders. Investments can be made directly by bank wire. To
establish a new account or add to an existing account by wire, please call the
Fund, at 1-800-266-5566, before wiring funds, to advise the Fund of the
investment, the dollar amount and the account registration. This will ensure
prompt and accurate handling of your investment. Please have your bank use the
following wiring instructions to purchase by wire:
Star Bank, N.A.
ABA# 042000013
For Boyar Value Fund #4836-16975
FFC: Shareholder Name and Account Number
It is important that the wire contain all the information and that the Fund
receives prior telephone notification to ensure proper credit. Once your wire is
sent you should, as soon as possible thereafter, complete and mail your Account
Application to the Fund as described under "Regular Mail Orders," above.
Additional Investments. You may add to your account by mail or wire
(minimum additional investment of $1,000) at any time by purchasing shares at
the then current net asset value as aforementioned. Before making additional
investments by bank wire, please call the Fund at 1-800-266-5566 to alert the
Fund that your wire is to be sent. Follow the wire instructions above to send
your wire. When calling for any reason, please have your account number ready,
if known. Mail orders should include, when possible, the "Invest by Mail" stub
which is attached to your Fund confirmation statement. Otherwise, be sure to
identify your account in your letter.
Automatic Investment Plan. The automatic investment plan enables
shareholders to make regular monthly or quarterly investment in shares through
automatic charges to their checking account. With shareholder authorization and
bank approval, the Administrator will automatically charge the checking account
for the amount specified ($100 minimum) which will be automatically invested in
shares at the net asset value on or about the last business day of the month or
quarter. The shareholder may change the amount of the investment or discontinue
the plan at any time by writing to the Administrator.
Employees and Affiliates of the Fund. The minimum purchase
requirement is not applicable to accounts of Directors, officers or employees of
the Fund or certain parties related thereto. The minimum initial investment for
such accounts is $1,000.
Stock Certificates. Stock certificates will not be issued for your
shares. Evidence of ownership will be given by
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issuance of periodic account statements which will show the number of shares
owned.
Tax-Deferred Retirement Plans. Shares of the Fund are available for
purchase in connection with the following tax-deferred retirement plans:
-- Keogh Plans for self-employed individuals;
-- Individual retirement account (IRA) plans for individuals and their
non-employed spouses;
-- Qualified pension and profit-sharing plans for employees, including
those profit-sharing plans with a 401(k) provision; and
-- 403(b)(7) custodial accounts for employees of public school systems,
hospitals, colleges and other nonprofit organizations meeting
certain requirements of the Internal Revenue Code of 1986, as
amended (the "Code").
Direct Deposit Plans. Shares of the Fund may be purchased through
direct deposit plans offered by certain employers and government agencies. These
plans enable a shareholder to have all or a portion of his or her payroll or
social security checks transferred automatically to purchase shares of the Fund.
HOW TO REDEEM SHARES
Shares of the Fund may be redeemed on each day that the Fund is open
for business by sending a written request to the Fund. The Fund is open for
business on each day the New York Stock Exchange (the "NYSE") is open for
business. Any redemption may be for more or less than the purchase price of your
shares depending on the market value of the Fund's portfolio securities. All
redemption orders received in proper form, as indicated herein, by the
Administrator prior to 4:00 p.m., Eastern time, will redeem shares at the net
asset value determined as of that business day's close of trading. Otherwise,
your order will redeem shares on the next business day. You may also redeem your
shares through a broker-dealer who may charge you a fee for its services.
The Board of Directors reserves the right to involuntarily redeem any
account having an account value of less than $5,000 (due to redemptions,
exchanges or transfers, and not due to market action) upon 60 days' written
notice. If the shareholder brings his account value up to $5,000 or more during
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the notice period, the account will not be redeemed. Redemptions from retirement
plans may be subject to tax withholding.
If you are uncertain of the requirements for redemption, please contact
the Fund, at 1-800-266-5566, or write to the address shown below.
Regular Mail Redemptions Your request should be addressed to Boyar
Value Fund, Inc., P.O. Box 5354, Cincinnati, Ohio 45201-5354. Your request for
redemption must include:
1) your letter of instruction or a stock assignment specifying the
account number, and the number of shares or dollar amount to be
redeemed. This request must be signed by all registered
shareholders in the exact names in which they are registered;
2) any required signature guarantees (see "Signature Guarantees");
and
3) other supporting legal documents, if required in the case of
estates, trusts, guardianships, custodianships, corporations,
partnerships, pension or profit sharing plans, and other
organizations.
Your redemption proceeds will be mailed to you within three business days after
receipt of your redemption request. However, the Fund may delay forwarding a
redemption check for recently purchased shares while it determines whether the
purchase payment will be honored. Such delay (which may take up to 15 days) may
be reduced or avoided if the purchase is made by certified check, government
check or wire transfer. In such cases, the net asset value next determined after
receipt of the request for redemption will be used in processing the redemption
and your redemption proceeds will be mailed to you upon clearance of your check
to purchase shares. The Fund may suspend redemption privileges or postpone the
date of payment (i) during any period that the NYSE is closed, or trading on the
NYSE is restricted as determined by the Securities and Exchange Commission (the
"Commission"), (ii) during any period when an emergency exists as defined by the
rules of the Commission as a result of which it is not reasonably practicable
for the Fund to dispose of securities owned by it, or to fairly determine the
value of its assets, and (iii) for such other periods as the Commission may
permit.
You can choose to have redemption proceeds mailed to you at your
address of record, your bank, or to any other authorized person, or you can have
the proceeds sent by bank wire
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to your bank ($5,000 minimum). Shares of the Fund may not be redeemed by wire on
days in which your bank is not open for business. Redemption proceeds will only
be sent to the bank account or person named in your Account Application
currently on file with the Fund. You can change your redemption instructions
anytime you wish by filing a letter including your new redemption instructions
with the Fund. (See "Signature Guarantees.")
There is currently no charge by the Administrator for wire
redemptions, however, the Fund's Custodian charges an $8 wire transfer fee for
redemptions made by wire. This fee is subject to change. The Administrator
reserves the right, upon thirty days' written notice, to make reasonable charges
for wire redemptions. All charges will be deducted from your account by
redemption of shares in your account. Your bank or brokerage firm may also
impose a charge for processing the wire. In the event that wire transfer of
funds is impossible or impractical, the redemption proceeds will be sent by mail
to the designated account.
Signature Guarantees. To protect your account and the Fund from fraud,
signature guarantees are required to be sure that you are the person who has
authorized a change in registration, or standing instructions, for your account.
Signature guarantees are required for (1) change of registration requests, and
(2) requests to establish or change redemption services other than through your
initial account application. Signature guarantees are acceptable from a member
bank of the Federal Reserve System, a savings and loan institution, credit
union, registered broker-dealer or a member firm of a U.S. Stock Exchange, and
must appear on the written request for redemption, or change of registration.
Systematic Withdrawal Plan. A shareholder who owns shares of the Fund
valued at $25,000 or more at the current offering price may establish a
Systematic Withdrawal Plan to receive a monthly or quarterly check in a stated
amount not less than $100. Each month or quarter as specified, the Fund will
automatically redeem sufficient shares from your account to meet the specified
withdrawal amount. The shareholder may establish this service whether dividends
and distributions are reinvested or paid in cash. Systematic withdrawals may be
deposited directly to the shareholder's bank account by completing the
applicable section on the Account Application form accompanying this Prospectus,
or by calling or writing the Fund.
HOW NET ASSET VALUE IS DETERMINED
The net asset value of the Fund is determined on each business day that
the NYSE is open for trading, as of the close
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of the NYSE (currently 4:00 p.m., Eastern time). Securities held by the Fund may
be primarily listed on foreign exchanges or traded in foreign markets which are
open on days (such as Saturdays and U.S. holidays) when the NYSE is not open for
business. As a result, the net asset value per share of the Fund may be
significantly affected by trading on days when the Fund is not open for
business. Net asset value per share is determined by dividing the total value of
all Fund securities (valued at market value) and other assets, less liabilities,
by the total number of shares then outstanding. Net asset value includes
interest on fixed income securities, which is accrued daily. See the Statement
of Additional Information for further details.
Securities which are traded over-the-counter are priced at the last
sale price, if available, otherwise, at the last quoted bid price. Securities
traded on a national stock exchange will be valued based upon the closing price
on the valuation date on the principal exchange where the security is traded.
Fixed-income securities will ordinarily be traded in the over-the-counter market
and common stocks will ordinarily be traded on a national securities exchange,
but may also be traded in the over-the-counter market. Foreign securities are
valued on the basis of quotations from the primary market in which they are
traded and are translated from the local currency into U.S. dollars using
currency exchange rates. Securities and other assets for which no quotations are
readily available will be valued in good faith at fair value using methods
determined by the Board of Directors.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Dividends and Distributions. The Fund expects to distribute
substantially all of its net investment income, if any, on an annual basis. The
Fund also expects to distribute any net realized long-term capital gains at
least once each year. Management will determine the timing and frequency of the
distributions of any net realized short-term capital gains.
Distributions are paid according to one of the following options:
Share Option - income distributions and capital gains distributions
reinvested in additional shares.
Income Option - income distributions and short-term capital gains
distributions paid in cash; long-term capital gains
distributions reinvested in additional shares.
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Cash Option - income distributions and capital gains distributions
paid in cash.
You should indicate your choice of option on your application. If no
option is specified on your application, distributions will automatically be
reinvested in additional shares. All distributions will be based on the net
asset value in effect on the payable date.
If you select the Income Option or the Cash Option and the
U.S. Postal Service cannot deliver your checks or if your checks remain uncashed
for six months, your dividends may be reinvested in your account at the then
current net asset value and your account will be converted to the Share Option.
Taxes. The Fund intends to qualify each year as a regulated investment
company ("RIC") within the meaning of the Code. As a RIC, the Fund will be
subject to a 4 percent non-deductible excise tax measured with respect to
certain undistributed amounts of ordinary income and capital gain. The Fund
excepts to pay such dividends and make such distributions as are necessary to
avoid the application of this tax.
Dividends paid from net investment income and distributions of net
realized short-term capital gains are taxable to investors as ordinary income,
and distributions derived from net realized long-term capital gains are taxable
to investors as long-term capital gains, in each case regardless of how long the
shareholder has held Fund shares and whether received in cash or reinvested in
additional Fund shares. As a general rule, an investor's gain or loss on a sale
or redemption of his Fund shares will be long-term capital gain or loss if he
has held his shares for more than one year and will be short-term capital gain
or loss if he has held his shares for one year or less. However, any loss
realized upon the sale or redemption of shares within six months from the date
of their purchase will be treated as a long-term capital loss to the extent of
any amounts treated as distributions of long-term capital gain during such
six-month period with respect to such shares.
The Taxpayer Relief Act of 1997 made certain changes to the Code with
respect to taxation of long-term capital gains earned by taxpayers other than a
corporation. In general, for sales made after May 6, 1997, the maximum tax rate
for individual taxpayers on net long-term capital gains is lowered to 20% for
most assets (including long-term capital gains recognized by shareholders on the
sale or redemption of Fund shares that were held as capital assets). This 20%
rate applies to sales on or after July 29, 1997 only if the asset was held for
more than 18 months at the time of disposition. Capital gains on the
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disposition of assets on or after July 29, 1997 held for more than one year and
up to 18 months at the time of disposition will be taxed as "mid-term gain" at a
maximum rate of 28%. A rate of 18% instead of 20% will apply after December 31,
2000 for assets held for more than 5 years. However, the 18% rate applies only
to assets after December 31, 2000 unless the taxpayer elects to treat an asset
held prior to such date as sold for fair market value on January 1, 2001. In the
case of individuals whose ordinary income is taxed at a 15% rate, the 20% rate
is reduced to 10% and the 10% rate for assets held for more than 5 years is
reduced to 8%. The Fund will provide information relating to that portion of a
"capital gain dividend" that may be treated by investors as eligible for the
reduced capital gains rate for capital assets held for more than 18 months.
Investors may be proportionately liable for taxes on income and gains
of the Fund, but investors not subject to tax on their income will not be
required to pay tax on amounts distributed to them. The Fund's investment
activities, including short sales of securities, will not result in unrelated
business taxable income to a tax-exempt investor. The Fund will designate that
portion of the Fund's dividends that will qualify for the federal dividends
received deduction for corporations. The Fund's investments in foreign
securities may subject them to certain withholding and other taxes imposed by
foreign countries with respect to dividends, interest, capital gains and other
income. It is not expected that the payment of such taxes by the Fund will give
rise to a direct credit or deduction available to the Fund's shareholders.
The Fund may be required to withhold federal income tax at a rate of 31
percent ("backup withholding") from dividends paid to non-corporate
shareholders. This tax may be withheld from dividends if (i) the shareholder
fails to furnish the Fund with the shareholder's correct taxpayer identification
number, (ii) the IRS notifies the Fund that the shareholder has failed to report
properly certain interest and dividend income to the IRS and to respond to
notices to that effect, or (iii) when required to do so, the shareholder fails
to certify that he or she is not subject to backup withholding. Redemption
proceeds may be subject to withholding under the circumstances described in (i)
above. Any amounts withheld under the backup withholding rules may be credited
against a shareholder's federal income tax liability.
Each shareholder will receive an annual statement setting forth the
dollar amounts of dividends and any distributions for the prior calendar year
and the tax status of such dividends and distributions for federal income tax
purposes.
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Shareholders should consult their own tax advisers as to the state and local tax
consequences of investing in the Fund.
ADDITIONAL INFORMATION
ORGANIZATION
The Fund is registered under the 1940 Act as an open-end, diversified,
management investment company and was incorporated on February 28, 1997 under
the laws of the State of Maryland. The Fund has an authorized capitalization of
1,000,000,000 shares with a par value of $.001 per share and transferable
without restriction. All shares of the Fund have equal rights and privileges as
to participation in dividends and distributions and in the net distributable
assets of the Fund on liquidation.
When issued, shares are fully paid and nonassessable, and have no
preemptive, conversion or exchange rights. Certain aspects of the shares may be
changed, upon notice to Fund shareholders, to satisfy certain tax regulatory
requirements, if the change is deemed necessary by the Directors.
From time to time, advertisements or reports to shareholders may
compare the performance of the Shares to that of other mutual funds (or classes
thereof) with a similar investment objective. The performance of the Shares also
might be compared to rankings prepared by Lipper Analytical Services, Inc. and
Morningstar, Inc., which are widely recognized, independent services that
monitor the performance of mutual funds, as well as to various unmanaged
indices, such as the Standard & Poor's 500 Composite Stock Price Index.
Performance information may be useful in reviewing the performance of the Shares
and in providing a basis for comparison with other investment alternatives.
Investors should be aware that, because the performance of the Fund changes in
response to fluctuation in interest rates, price fluctuations in securities
markets, the Fund's expenses and other factors, a performance quotation should
not be considered representative of the Fund's performance for any future
period. Shareholders may make inquiries regarding the Fund, including current
performance quotations, by calling their account representative.
VOTING RIGHTS
Investors in the Fund are entitled to one vote for each full share held
and proportional, fractional votes for fractional shares held. There will
normally be no meeting of investors for the purpose of electing members of the
Board unless and until such time as less than a majority of the members holding
office
-27-
<PAGE>
have been elected by investors. Any Director of the Fund may be removed
from office upon the vote of shareholders holding at least a majority of the
Fund's outstanding shares, at a meeting called for that purpose. A meeting will
be called for the purpose of voting on the removal of a Board member at the
written request of 10% of the outstanding shares of the Fund.
* * *
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus, the Fund's
Statement of Additional Information or the Fund's official sales literature in
connection with the offering of shares of the Fund, and if given or made, such
other information or representations must not be relied upon as having been
authorized by the Fund. This Prospectus does not constitute an offer of the
Common Shares of the Fund in any state in which, or to any person to whom, such
offer may not lawfully be made.
-28-
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS STATEMENT OF ADDITIONAL INFORMATION DOES NOT CONSTITUTE A
PROSPECTUS.
<PAGE>
Subject to completion, dated November 18, 1997
STATEMENT OF ADDITIONAL INFORMATION
__________, 1997
BOYAR VALUE FUND, INC.
590 Madison Avenue, New York, New York 10022
For information, call 800-266-5566
Contents
Page
Investment Objective.....................................................2
Investment Policies......................................................2
Investment Limitations...................................................8
Portfolio Valuation.....................................................10
Portfolio Transactions..................................................11
Management Of The Fund..................................................14
Distribution And Shareholder Servicing..................................17
Additional Purchase And Redemption Information..........................18
Additional Information Concerning Taxes.................................18
Determination Of Performance............................................24
Independent Accountants And Counsel.....................................25
Financial Statement.....................................................25
This Statement of Additional Information is meant to be read in
conjunction with the Prospectus for Boyar Value Fund Inc. (the "Fund"), dated
___________, 1997, as amended or supplemented from time to time, and is
incorporated by reference in its entirety into that Prospectus. Because this
Statement of Additional Information is not itself a prospectus, no investment in
shares of the Fund should be made solely upon the information contained herein.
Copies of the Fund's Prospectus may be obtained by calling the Fund at
800-266-5566.
<PAGE>
INVESTMENT OBJECTIVE
The investment objective of the Fund is long-term capital
appreciation.
INVESTMENT POLICIES
The following policies supplement the descriptions of the Fund's
investment objective and policies in the Prospectus.
Stock Options and Currency Exchange Transactions
- ------------------------------------------------
Stock Options. When Boyar Asset Management, Inc. (the "Adviser")
believes that individual portfolio securities are approaching the top of the
Adviser's growth and price expectations, the Fund may write covered call options
against such securities. The Fund may also purchase put options. The value of
the underlying securities on which covered call and put options will be written
or purchased, respectively, at any one time by the Fund is not anticipated to
exceed 5% of the Fund's total assets. The Fund writes and purchases options only
for hedging purposes and not for speculation.
The Fund realizes fees (referred to as "premiums") for granting the
rights evidenced by the options it has written. A call option embodies the right
of its purchaser to compel the writer of the option to sell to the option holder
an underlying security at a specified price for a specified time period or at a
specified time. A put option embodies the right of its purchaser to compel the
writer of the option to purchase from the option holder an underlying security
at a specified price for a specified period or at a specified time.
The principal reason for writing covered call options on a security is
to attempt to realize, through the receipt of premiums, a greater return than
would be realized on the securities alone. In return for a premium, the Fund as
the writer of a covered call option forfeits the right to any appreciation in
the value of the underlying security above the strike price for the life of the
option (or until a closing purchase transaction can be effected). Nevertheless,
the Fund as a call writer retains the risk of a decline in the price of the
underlying security. The size of the premiums that the Fund may receive may be
adversely affected as new or existing institutions, including other investment
companies, engage in or increase their option-writing activities.
In the case of options written by the Fund that are deemed covered by
virtue of the Fund's holding convertible or exchangeable preferred stock or debt
securities, the time required to convert or exchange and obtain physical
delivery of the underlying common stock with respect to which the Fund has
written options may exceed the time within which the Fund must make delivery in
accordance with an exercise notice. In these instances, the Fund may purchase or
temporarily borrow the underlying securities for purposes of physical delivery.
By so doing, the Fund will not bear any market risk, since the Fund will have
the absolute right to receive from the issuer of the underlying security an
equal number of shares to replace
2
<PAGE>
the borrowed securities, but the Fund may incur additional transaction costs or
interest expenses in connection with any such purchase or borrowing.
Options written by the Fund will normally have expiration dates
between one and nine months from the date written. The exercise price of the
options may be below, equal to or above the market values of the underlying
securities at the times the options are written. In the case of call options,
these exercise prices are referred to as "in-the-money," "at-the-money" and
"out-of-the-money," respectively. The Fund may write (i) in-the-money call
options when the Adviser expects that the price of the underlying security will
remain flat or decline moderately during the option period, (ii) at-the-money
call options when the Adviser expects that the price of the underlying security
will remain flat or advance moderately during the option period and (iii)
out-of-the-money call options when the Adviser expects that the premiums
received from writing the call option plus the appreciation in market price of
the underlying security up to the exercise price will be greater than the
appreciation in the price of the underlying security alone. In any of the
preceding situations, if the market price of the underlying security declines
and the security is sold at this lower price, the amount of any realized loss
will be offset wholly or in part by the premium received. To secure its
obligation to deliver the underlying security when it writes a call option, the
Fund will be required to deposit in escrow the underlying security or other
assets in accordance with the rules of the Options Clearing Corporation (the
"Clearing Corporation") and of the securities exchange on which the option is
written.
Prior to their expirations, call options may be sold in closing sale
or purchase transactions (sales or purchases by the Fund prior to the exercise
of options that it has purchased or written, respectively, of options of the
same series) in which the Fund may realize a profit or loss from the sale. An
option position may be closed out only where there exists a secondary market for
an option of the same series on a recognized securities exchange or in the
over-the-counter market. When the Fund has purchased a put option and engages in
a closing sale transaction, whether the Fund realizes a profit or loss will
depend upon whether the amount received in the closing sale transaction is more
or less than the premium the Fund initially paid for the original option plus
the related transaction costs. Similarly, in cases where the Fund has written a
call option, it will realize a profit if the cost of the closing purchase
transaction is less than the premium received upon writing the original option
and will incur a loss if the cost of the closing purchase transaction exceeds
the premium received upon writing the original option. The Fund may engage in a
closing purchase transaction to realize a profit, to prevent an underlying
security with respect to which it has written an option from being called or, in
the case of a call option, to unfreeze an underlying security (thereby
permitting its sale or the writing of a new option on the security prior to the
outstanding option's expiration). The obligation of the Fund under an option it
has written would be terminated by a closing purchase transaction, but the Fund
would not be deemed to own an option as a result of the transaction. So long as
the obligation of the Fund as the writer of an option continues, the Fund may be
assigned an exercise notice by the broker-dealer through which the option was
sold, requiring the Fund to deliver the underlying security against payment of
the exercise price. This obligation terminates when the option
3
<PAGE>
expires or the Fund effects a closing purchase transaction. The Fund can no
longer effect a closing purchase transaction with respect to an option once it
has been assigned an exercise notice.
There is no assurance that sufficient trading interest will exist to
create a liquid secondary market on a securities exchange for any particular
option or at any particular time, and for some options no such secondary market
may exist. A liquid secondary market in an option may cease to exist for a
variety of reasons. In the past, for example, higher than anticipated trading
activity or order flow or other unforeseen events have at times rendered certain
of the facilities of the Clearing Corporation and various securities exchanges
inadequate and resulted in the institution of special procedures, such as
trading rotations, restrictions on certain types of orders or trading halts or
suspensions in one or more options. There can be no assurance that similar
events, or events that may otherwise interfere with the timely execution of
customers' orders, will not recur. In such event, it might not be possible to
effect closing transactions in particular options. Moreover, the Fund's ability
to terminate options positions established in the over-the-counter market may be
more limited than for exchange-traded options and may also involve the risk that
securities dealers participating in over-the-counter transactions would fail to
meet their obligations to the Fund. The Fund, however, intends to purchase
over-the-counter options only from dealers whose debt securities, as determined
by the Adviser, are considered to be investment grade. If, as a covered call
option writer, the Fund is unable to effect a closing purchase transaction in a
secondary market, it will not be able to sell the underlying security until the
option expires or it delivers the underlying security upon exercise. In either
case, the Fund would continue to be at market risk on the security and could
face higher transaction costs, including brokerage commissions.
Securities exchanges generally have established limitations governing
the maximum number of calls of each class which may be held or written, or
exercised within certain time periods by an investor or group of investors
acting in concert (regardless of whether the options are written on the same or
different securities exchanges or are held, written or exercised in one or more
accounts or through one or more brokers). It is possible that the Fund and other
clients of the Adviser may be considered to be such a group. A securities
exchange may order the liquidation of positions found to be in violation of
these limits and it may impose certain other sanctions. These limits may
restrict the number of options the Fund will be able to purchase on a particular
security.
Currency Exchange Transactions. The value in U.S. dollars of the
assets of the Fund that are invested in foreign securities may be affected
favorably or unfavorably by changes in exchange control regulations, and the
Fund may incur costs in connection with conversion between various currencies.
Currency exchange transactions may be from any non-U.S. currency into U.S.
dollars or into other appropriate currencies. The Fund will conduct its currency
exchange transactions (i) on a spot (i.e., cash) basis at the rate prevailing in
the currency exchange market, (ii) through entering into forward contracts to
purchase or sell currency or (iii) by purchasing exchange-traded currency
options.
4
<PAGE>
Foreign Investments. Investors should recognize that investing in
foreign companies involves certain risks, including those discussed below, which
are not typically associated with investing in U.S. issuers. Since the Fund may
invest in securities denominated in currencies other than the U.S. dollar, and
since the Fund may temporarily hold funds in bank deposits or other money market
investments denominated in foreign currencies, the Fund may be affected
favorably or unfavorably by exchange control regulations or changes in the
exchange rate between such currencies and the dollar. A change in the value of a
foreign currency relative to the U.S. dollar will result in a corresponding
change in the dollar value of the Fund's assets denominated in that foreign
currency. Changes in foreign currency exchange rates may also affect the value
of dividends and interest earned, gains and losses realized on the sale of
securities and net investment income and gains, if any, to be distributed to
shareholders by the Fund. The rate of exchange between the U.S. dollar and other
currencies is determined by the forces of supply and demand in the foreign
exchange markets. Changes in the exchange rate may result over time from the
interaction of many factors directly or indirectly affecting economic and
political conditions in the United States and a particular foreign country,
including economic and political developments in other countries. Of particular
importance are rates of inflation, interest rate levels, the balance of payments
and the extent of government surpluses or deficits in the United States and the
particular foreign country, all of which are in turn sensitive to the monetary,
fiscal and trade policies pursued by the governments of the United States and
foreign countries important to international trade and finance. Governmental
intervention may also play a significant role. National governments rarely
voluntarily allow their currencies to float freely in response to economic
forces. Sovereign governments use a variety of techniques, such as intervention
by a country's central bank or imposition of regulatory controls or taxes, to
affect the exchange rates of their currencies.
Individual foreign economies may differ favorably or unfavorably from
the U.S. economy in such respects as growth of gross national product, rate of
inflation, capital reinvestment, resource self-sufficiency, and balance of
payments positions. The Fund may invest in securities of foreign governments (or
agencies or instrumentalities thereof), and many, if not all, of the foregoing
considerations apply to such investments as well.
Securities of some foreign companies are less liquid and their prices
are more volatile than securities of comparable U.S. companies. Certain foreign
countries are known to experience long delays between the trade and settlement
dates of securities purchased or sold. Due to the increased exposure of the Fund
to market and foreign exchange fluctuations brought about by such delays, and
due to the corresponding negative impact on Fund liquidity, the Fund will avoid
investing in countries which are known to experience settlement delays which may
expose the Fund to unreasonable risk of loss.
U.S. Government Securities. The Fund may invest in debt obligations of
varying maturities issued or guaranteed by the United States government, its
agencies or instrumentalities ("U.S. government securities"). Direct obligations
of the U.S. Treasury include a variety of securities that differ in their
interest rates, maturities and dates of issuance. U.S. government securities
5
<PAGE>
also include securities issued or guaranteed by the Federal Housing
Administration, Farmers Home Loan Administration, Export-Import Bank of the
United States, Small Business Administration, Government National Mortgage
Association, General Services Administration, Central Bank for Cooperatives,
Federal Farm Credit Banks, Federal Home Loan Banks, Federal Home Loan Mortgage
Corporation, Federal Intermediate Credit Banks, Federal Land Banks, Federal
National Mortgage Association, Maritime Administration, Tennessee Valley
Authority, District of Columbia Armory Board and Student Loan Marketing
Association. The Fund may also invest in instruments that are supported by the
right of the issuer to borrow from the U.S. Treasury and instruments that are
supported by the credit of the instrumentality. Because the U.S. government is
not obligated by law to provide support to an instrumentality it sponsors, the
Fund will invest in obligations issued by such an instrumentality only if the
Adviser determines that the credit risk with respect to the instrumentality does
not make its securities unsuitable for investment by the Fund.
Lending of Portfolio Securities. The Fund may lend portfolio
securities to brokers, dealers and other financial organizations that meet
capital and other credit requirements or other criteria established by the
Fund's Board of Directors (the "Board"). These loans, if and when made, may not
exceed 30% of the Fund's total assets taken at current value. The Fund will not
lend portfolio securities to affiliates of the Adviser unless it has applied for
and received specific authority to do so from the SEC. Loans of portfolio
securities will be collateralized by cash, letters of credit or U.S. government
securities, which are maintained at all times in an amount equal to at least
100% of the current market value of the loaned securities. Any gain or loss in
the market price of the securities loaned that might occur during the term of
the loan would be for the account of the Fund. From time to time, the Fund may
return a part of the interest earned from the investment of collateral received
for securities loaned to the borrower and/or a third party that is unaffiliated
with the Fund and that is acting as a "finder."
By lending its securities, the Fund can increase its income by
continuing to receive interest and any dividends on the loaned securities as
well as by either investing the collateral received for securities loaned in
short-term instruments or obtaining yield in the form of interest paid by the
borrower when U.S. government securities are used as collateral. Although the
generation of income is not an investment objective of the Fund, income received
could be used to pay the Fund's expenses and would increase an investor's total
return. The Fund will adhere to the following conditions whenever its portfolio
securities are loaned: (i) the Fund must receive at least 100% cash collateral
or equivalent securities of the type discussed in the preceding paragraph from
the borrower; (ii) the borrower must increase such collateral whenever the
market value of the securities rises above the level of such collateral; (iii)
the Fund must be able to terminate the loan at any time; (iv) the Fund must
receive reasonable interest on the loan, as well as any dividends, interest or
other distributions on the loaned securities and any increase in market value;
(v) the Fund may pay only reasonable custodian fees in connection with the loan;
and (vi) voting rights on the loaned securities may pass to the borrower,
provided, however, that if a material event adversely
6
<PAGE>
affecting the investment occurs, the Board must terminate the loan and regain
the right to vote the securities. Loan agreements involve certain risks
in the event of default or insolvency of the other party including possible
delays or restrictions upon the Fund's ability to recover the loaned securities
or dispose of the collateral for the loan.
American, European and Continental Depositary Receipts. The assets of
the Fund may be invested in the securities of foreign issuers in the form of
American Depositary Receipts ("ADRs") and European Depositary Receipts ("EDRs").
These securities may not necessarily be denominated in the same currency as the
securities into which they may be converted. ADRs are receipts typically issued
by a U.S. bank or trust company which evidence ownership of underlying
securities issued by a foreign corporation. EDRs, which are sometimes referred
to as Continental Depositary Receipts ("CDRs"), are receipts issued in Europe
typically by non-U.S. banks and trust companies that evidence ownership of
either foreign or domestic securities. Generally, ADRs in registered form are
designed for use in U.S. securities markets and EDRs and CDRs in bearer form are
designed for use in European securities markets.
Convertible Securities. Convertible securities are fixed income
securities that may be converted at either a stated price or stated rate into
underlying shares of common stock. Because of this conversion feature,
convertible securities enable an investor to benefit from increases in the
market price of the underlying common stock while permitting the investor to
obtain a yield that is generally greater than that obtainable from the
underlying common stock. In addition, convertible securities generally offer
greater stability of price than the underlying common stock during declining
market periods. The value of convertible securities fluctuates in relation to
changes in interest rates and, in addition, also fluctuates in relation to the
underlying common stock. The Adviser may make modifications of its investment
strategy for the Fund as it deems advisable in light of its experience in
managing the Fund or in response to changing market or economic conditions.
Warrants. The Fund may purchase warrants issued by domestic and
foreign companies to purchase newly created equity securities consisting of
common and preferred stock. The equity security underlying a warrant is
outstanding at the time the warrant is issued or is issued together with the
warrant.
Investing in warrants can provide a greater potential for profit or
loss than an equivalent investment in the underlying security, and, thus, can be
a speculative investment. The value of a warrant may decline because of a
decline in the value of the underlying security, the passage of time, changes in
interest rates or in the dividend or other policies of the company whose equity
underlies the warrant or a change in the perception as to the future price of
the underlying security, or any combination thereof. Warrants generally pay no
dividends and confer no voting or other rights other than to purchase the
underlying security.
7
<PAGE>
Illiquid Securities. The Fund may not invest more than 15% of its net
assets in illiquid securities, including securities that are illiquid by virtue
of the absence of a readily available market, time deposits maturing in more
than seven days and repurchase agreements which have a maturity of longer than
seven days. Securities that have legal or contractual restrictions on resale but
have a readily available market are not considered illiquid for purposes of this
limitation. Repurchase agreements subject to demand are deemed to have a
maturity equal to the notice period.
Historically, illiquid securities have included securities subject to
contractual or legal restrictions on resale because they have not been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
securities which are otherwise not readily marketable and repurchase agreements
having a maturity of longer than seven days. Securities which have not been
registered under the Securities Act are referred to as private placements or
restricted securities and are purchased directly from the issuer or in the
secondary market. Mutual funds do not typically hold a significant amount of
these restricted or other illiquid securities because of the potential for
delays on resale and uncertainty in valuation. The Fund's investment in illiquid
securities is subject to the risk that, should the Fund desire to sell any of
these securities when a ready buyer is not available at a price that is deemed
to be representative of their value, the value of the Fund's net assets could be
adversely affected.
Borrowing. The Fund may borrow, temporarily, up to 30% of its total
assets for extraordinary purposes or to meet redemption requests which might
otherwise require untimely disposition of portfolio holdings. To the extent the
Fund borrows for these purposes, the effects of market price fluctuations on
portfolio net asset value will be exaggerated. If, while such borrowing is in
effect, the value of the Fund's assets declines, the Fund could be forced to
liquidate portfolio securities when it is disadvantageous to do so. The Fund
would incur interest and other transaction costs in connection with borrowing.
The Fund will borrow only from a bank.
INVESTMENT LIMITATIONS
The investment limitations numbered 1 through 10 may not be changed
without the affirmative vote of the holders of a majority of the Fund's
outstanding shares. Such majority is defined as the lesser of (i) 67% or more of
the shares present at the meeting, if the holders of more than 50% of the
outstanding shares of the Fund are present or represented by proxy, or (ii) more
than 50% of the outstanding shares. Investment limitations 11 through 15 may be
changed by a vote of the Board at any time.
The Fund may not:
1. Borrow money except that the Fund may borrow from banks for
temporary or emergency purposes in an amount that may not exceed 30% of the
value of the Fund's total assets at the time of such borrowing. For purposes of
this restriction, short sales, the entry into currency transactions, options,
and forward commitment transactions that are not accounted for as financings
(and the segregation of assets in connection with any of the foregoing) shall
not constitute borrowing.
8
<PAGE>
2. Make loans, except that the Fund may purchase or hold fixed-income
securities, lend portfolio securities and enter into repurchase agreements in
accordance with its investment objective, policies and limitations.
3. Purchase any securities which would cause 25% or more of the value
of the Fund's total assets at the time of purchase to be invested in the
securities of issuers conducting their principal business activities in the same
industry; provided that there shall be no limit on the purchase of U.S.
Government Securities.
4. Purchase the securities of any issuer if as a result (a) more than
5% of the value of the Fund's total assets would be invested in the securities
of such issuer or (b) the Fund would acquire 10% or more of the voting
securities of such issuer, except that these limitations do not apply to U.S.
Government Securities and except that up to 25% of the value of the Fund's total
assets may be invested without regard to these limitations.
5. Underwrite any securities issued by others except to the extent
that the investment in restricted securities and the sale of securities or the
purchase of securities directly from the issuer in accordance with the Fund's
investment objective, policies and limitations may be deemed to be underwriting.
6. Purchase or sell real estate, except that the Fund may invest in
securities (a) secured by real estate, mortgages or interests therein or (b)
issued by companies which invest in real estate or interests therein.
7. Make short sales of securities or maintain a short position, except
that the Fund may maintain short positions in currencies, securities and stock
indexes, futures contracts and options on futures contracts and enter into short
sales or short sales "against the box" in accordance with the Fund's investment
objective, policies and limitations.
8. Purchase securities on margin, except that the Fund may obtain any
short-term credits necessary for the clearance of purchases and sales of
securities. For purposes of this restriction, the deposit or payment of initial
or variation margin in connection with transactions in currencies, options,
futures contracts or related options will not be deemed to be a purchase of
securities on margin.
9. Invest in commodities, except that the Fund may (a) purchase and
sell futures contracts, including those relating to securities, currencies and
indexes, and options on futures contracts, securities, currencies or indexes,
(b) purchase and sell currencies on a forward commitment or delayed-delivery
basis and (c) enter into stand-by commitments.
9
<PAGE>
10. Pledge, mortgage or hypothecate its assets, or otherwise issue
senior securities, except (a) to the extent necessary to secure permitted
borrowings and (b) to the extent related to the deposit of assets in escrow in
connection with the purchase of securities on a forward commitment or
delayed-delivery basis and collateral and initial or variation margin
arrangements with respect to currency transactions, options, futures contracts,
and options on futures contracts.
11. Invest more than 15% of the Fund's net assets in securities which
may be illiquid because of legal or contractual restrictions on resale or
securities for which there are no readily available market quotations. For
purposes of this limitation, repurchase agreements with maturities greater than
seven days shall be considered illiquid securities.
12. Make additional investments if the Fund's borrowings exceed 5% of
its total assets.
13. Purchase securities of other investment companies except in
connection with a merger, consolidation, acquisition, reorganization or offer of
exchange, or as otherwise permitted under the 1940 Act.
14. Invest in oil, gas or mineral exploration or development programs,
except that the Fund may invest in securities of companies that invest in or
sponsor oil, gas or mineral exploration or development programs.
15. Invest in warrants (other than warrants acquired by the Fund as
part of a unit or attached to securities at the time of purchase) if, as a
result, the investments (valued at the lower of cost or market) would exceed 10%
of the value of the Fund's net assets.
Notwithstanding paragraphs numbered 1, 7, 8, 9 and 10, the Fund has no
present intention of engaging in transactions involving futures contracts and
options on futures contracts or of entering into short sales and short sales
"against the box," and will not do so until approved by the Fund's Board and
upon appropriate notice to investors.
If a percentage restriction (other than the percentage limitation set
forth in No. 1 above) is adhered to at the time of an investment, a later
increase or decrease in the percentage of assets resulting from a change in the
values of portfolio securities or in the amount of the Fund's assets will not
constitute a violation of such restriction.
PORTFOLIO VALUATION
The share net price (net asset value) of the shares of the Fund is
determined as of the close of the regular session of trading on the New York
Stock Exchange ("NYSE") (currently 4:00 p.m., Eastern time) on each business
day, except on days when the NYSE is closed. The NYSE is currently scheduled to
be closed on New Year's Day, Dr. Martin Luther King, Jr. Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and
Christmas, and on the preceding Friday or subsequent Monday
10
<PAGE>
when one of these holidays falls on a Saturday or Sunday, respectively. The
Fund may also be open for business on other days in which there is sufficient
trading in its portfolio securities such that its net asset value might be
materially affected. For a description of the methods used to determine the
share price, see "Net Asset Value" in the Prospectus.
Trading in securities in certain foreign countries is completed at
various times prior to the close of business on each business day in New York
(i.e., a day on which the NYSE is open for trading). In addition, securities
trading in a particular country or countries may not take place on all business
days in New York. Furthermore, trading takes place in various foreign markets on
days which are not business days in New York and days on which the Fund's net
asset value is not calculated. As a result, calculation of the Fund's net asset
value may not take place contemporaneously with the determination of the prices
of certain portfolio securities used in such calculation. Events affecting the
values of portfolio securities that occur between the time their prices are
determined and the close of regular trading on the NYSE will not be reflected in
the Fund's calculation of net asset value unless the Board or its delegates
deems that the particular event would materially affect net asset value, in
which case an adjustment may be made. All assets and liabilities initially
expressed in foreign currency values will be converted into U.S. dollar values
at the prevailing rate as quoted by a Pricing Service. If such quotations are
not available, the rate of exchange will be determined in good faith pursuant to
consistently applied procedures established by the Board.
PORTFOLIO TRANSACTIONS
The Adviser is responsible for establishing, reviewing and, where
necessary, modifying the Fund's investment program to achieve its investment
objective. Purchases and sales of newly issued portfolio securities are usually
principal transactions without brokerage commissions effected directly with the
issuer or with an underwriter acting as principal. Other purchases and sales may
be effected on a securities exchange or over-the-counter, depending on where it
appears that the best price or execution will be obtained. The purchase price
paid by the Fund to underwriters of newly issued securities usually includes a
concession paid by the issuer to the underwriter, and purchases of securities
from dealers, acting as either principals or agents in the after market, are
normally executed at a price between the bid and asked price, which includes a
dealer's mark-up or mark-down. Transactions on U.S. stock exchanges and some
foreign stock exchanges involve the payment of negotiated brokerage commissions.
On exchanges on which commissions are negotiated, the cost of transactions may
vary among different brokers. On most foreign exchanges, commissions are
generally fixed. There is generally no stated commission in the case of
securities traded in domestic or foreign over-the-counter markets, but the price
of securities traded in over-the-counter markets includes an undisclosed
commission or mark-up. U.S. government securities are generally purchased from
underwriters or dealers, although certain newly issued U.S. government
securities may be purchased directly from the U.S. Treasury or from the issuing
agency or instrumentality.
11
<PAGE>
The Adviser will select specific portfolio investments and effect
transactions for the Fund and in doing so seeks to obtain the overall best
execution of portfolio transactions. In evaluating prices and executions, the
Adviser will consider the factors it deems relevant, which may include the
breadth of the market in the security, the price of the security, the financial
condition and execution capability of a broker or dealer and the reasonableness
of the commission, if any, for the specific transaction and on a continuing
basis. All orders for transactions in securities and options on behalf of the
Fund are placed with broker-dealers selected by the Adviser. Affiliates of the
Manager or the Adviser may serve as the Fund's broker in effecting portfolio
transactions on national securities exchanges and retain commissions in
accordance with certain regulations of the SEC.
The Adviser may, in its discretion, effect transactions in portfolio
securities with dealers who provide brokerage and research services (as those
terms are defined in Section 28(e) of the Securities Exchange Act of 1934) to
the Fund and/or other accounts over which the Adviser exercises investment
discretion. The Adviser may place portfolio transactions with a broker or dealer
with whom it has negotiated a commission that is in excess of the commission
another broker or dealer would have charged for effecting the transaction if the
Adviser determines in good faith that such amount of commission was reasonable
in relation to the value of such brokerage and research services provided by
such broker or dealer viewed in terms of either that particular transaction or
of the overall responsibilities of the Adviser. Research and other services
received may be useful to the Adviser in serving both the Fund and its other
clients and, conversely, research or other services obtained by the placement of
business of other clients may be useful to the Adviser in carrying out its
obligations to the Fund. Research may include furnishing advice, either directly
or through publications or writings, as to the value of securities, the
advisability of purchasing or selling specific securities and the availability
of securities or purchasers or sellers of securities; furnishing seminars,
information, analyses and reports concerning issuers, industries, securities,
trading markets and methods, legislative developments, changes in accounting
practices, economic factors and trends and portfolio strategy; access to
research analysts, corporate management personnel, industry experts and
economists; comparative performance evaluation and technical measurement
services and quotation services; and products and other services (such as third
party publications, reports and analyses, and computer and electronic access,
equipment, software, information and accessories that deliver, process or
otherwise utilize information, including the research described above) that
assist the Adviser in carrying out its responsibilities. Research received from
brokers or dealers is supplemental to the Adviser's own research program. The
fees to the Adviser under its advisory agreement with the Fund are not reduced
by reason of its receiving any brokerage and research services.
Investment decisions for the Fund concerning specific portfolio
securities are made independently from those for other clients advised by the
Adviser. Such other investment clients may invest in the same securities as the
Fund. When purchases or sales of the same security are made at substantially the
same time on behalf of such other clients, transactions are averaged as to price
and available investments allocated as to amount, in a manner which the Adviser
believes to be equitable to each client, including the Fund. In some
12
<PAGE>
instances, this investment procedure may adversely affect the price paid or
received by the Fund or the size of the position obtained or sold for the Fund.
To the extent permitted by law, securities to be sold or purchased for the Fund
may be aggregated with those to be sold or purchased for such other investment
clients in order to obtain best execution.
Any portfolio transaction for the Fund on a securities exchange may be
executed through Ladenburg Thalmann & Co. Inc. (the "Distributor") or the
Adviser if, in the Adviser's judgment, the use of the Distributor or the Adviser
is likely to result in price and execution at least as favorable as those of
other qualified brokers, and if, in the transaction, the Distributor or the
Adviser charges the Fund a commission rate consistent with those charged by the
Distributor or the Adviser to comparable unaffiliated customers in similar
transactions. All transactions with affiliated brokers will comply with Rule
17e-1 under the 1940 Act.
In no instance will portfolio securities be purchased from or sold to
Ladenburg Thalmann Fund Management Inc. (the "Manager"), the Adviser or the
Distributor or any affiliated person of such companies. In addition, the Fund
will not give preference to any institutions with whom the Fund enters into
distribution or shareholder servicing agreements concerning the provision of
distribution services or support services.
Transactions for the Fund may be effected on foreign securities
exchanges. In transactions for securities not actively traded on a foreign
securities exchange, the Fund will deal directly with the dealers who make a
market in the securities involved, except in those circumstances where better
prices and execution are available elsewhere. Such dealers usually are acting as
principal for their own account. On occasion, securities may be purchased
directly from the issuer. Such portfolio securities are generally traded on a
net basis and do not normally involve brokerage commissions. Securities firms
may receive brokerage commissions on certain portfolio transactions, including
options, futures and options on futures transactions and the purchase and sale
of underlying securities upon exercise of options.
The Fund may participate, if and when practicable, in bidding for the
purchase of securities for the Fund's portfolio directly from an issuer in order
to take advantage of the lower purchase price available to members of such a
group. The Fund will engage in this practice, however, only when the Adviser, in
its sole discretion, believes such practice to be otherwise in the Fund's
interest.
Portfolio Turnover
The Fund anticipates that the rate of Portfolio turnover will,
generally, not exceed 50%. The Fund does not intend to seek profits through
short-term trading, but the rate of turnover will not be a limiting factor when
the Fund deems it desirable to sell or purchase securities. The Fund's portfolio
turnover rate is calculated by dividing the lesser of purchases or sales of its
portfolio securities for the year by the monthly average value of the portfolio
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<PAGE>
securities. Securities with remaining maturities of one year or less at the date
of acquisition are excluded from the calculation.
MANAGEMENT OF THE FUND
Officers and Board of Directors
- -------------------------------
The names (and ages) of the Fund's Directors and officers, their
addresses, present positions and principal occupations during the past five
years and other affiliations are set forth below.
Occupations During the Past
Name, Address, Age Position(s) Held Five Years
- ------------------ ---------------- ---------------------------
Mark A. Boyar (54)* Chairman and Chief President and Director of
35 East 21 Street Executive Officer Boyar Asset Management, Inc.
New York, New York 10010 since June 1983; President
of Mark Boyar & Co. since
since 1979.
Jay R. Petschek (39)* President, Treasurer, President and Director of
590 Madison Avenue Chief Financial Ladenburg Thalmann Asset
New York, New York 10022 Officer and Director Management Inc. since 1996;
Senior Managing Director,
Director of Investment
Policy and Director of
Ladenburg Thalmann & Co.,
Inc. since 1996 and Managing
Director Corporate Finance
from 1984-1995; President of
Corsair Management Company
Inc. since 1993; General
Partner of Corsair Capital
Partners L.P. since 1991.
* Indicates an "interested person" under Section 2(a)(19) of the 1940 Act.
No employee of the Manager, the Adviser or any of their respective
affiliates will receive any compensation from the Fund for acting as an officer
or director of the Fund. Each other Director will receive an annual fee of
$1,000, and $1,000 for each meeting of the Board attended by him for his
services as Director and will be reimbursed for expenses incurred in connection
with his attendance at Board meetings.
14
<PAGE>
Directors' Compensation
- -----------------------
Name of Director Total Compensation from Fund+
---------------- ----------------------------
Mark A. Boyar None
Jay R. Petschek None
+ Amounts shown are estimates of future payments to be made in the fiscal year
ending December 31, 1998.
As of November 18, 1997, the officers and directors of the Fund as a group
owned less than 1% of the Fund's outstanding shares.
Manager
- -------
The Manager serves as manager of the Fund pursuant to a management
agreement (the "Management Agreement"). The services provided by, and the fees
payable by the Fund to, the Manager under the Management Agreement are described
in the Prospectus. The fees are calculated at an annual rate based on a
percentage of the Fund's average daily net assets. See in the Prospectus,
"Management of the Fund."
The Fund is responsible for the payment of all expenses incurred in
connection with the organization, registration of shares and operations of the
Fund, including such extraordinary or non-recurring expenses as may arise, such
as litigation to which the Fund may be a party. The Fund may have an obligation
to indemnify the fund's officers and Directors with respect to such litigation,
except in instances of willful misfeasance, bad faith, gross negligence or
reckless disregard by such officers and Directors in the performance of their
duties. The Manager bears promotional expenses in connection with the
distribution of the Fund's shares to the extent that such expenses are not
assumed by the Fund under its 12b-1 Plan (see below). The compensation and
expenses of any officer, Director or employee of the Fund who is an officer,
director or employee of the Manager are paid by the Manager.
By its terms, the Fund's Management Agreement will remain in force for
an initial two-year term and from year to year thereafter, subject to annual
approval by (a) the Board of Directors or (b) a vote of the majority of the
Fund's outstanding voting securities; provided that in either event continuance
is also approved by a majority of the Directors who are not interested persons
of the Fund, by a vote cast in person at a meeting called for the purpose of
voting on such approval. The Fund's Management Agreement may be terminated at
any time, on sixty days' written notice, without the payment of any penalty, by
the Board of Directors, by a vote of the majority of a Fund's outstanding voting
securities, or by the Manager. The Management Agreement automatically terminates
in the event of its assignment, as defined by the 1940 Act and the rules
thereunder.
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<PAGE>
Investment Adviser
- ------------------
The Adviser serves as investment adviser to the Fund pursuant to a
written agreement (the "Investment Advisory Agreement"). The services provided
by, and the fees payable by the Fund to the Adviser under the Investment
Advisory Agreement are described in the Prospectus. These fees are calculated at
an annual rate based on a percentage of the Fund's average daily net assets. See
in the Prospectus, "Management of the Fund."
By its terms, the Fund's Advisory Agreement will remain in force for
an initial two-year term and from year to year thereafter, subject to annual
approval by (a) the Board of Directors or (b) a vote of the majority of the
Fund's outstanding voting securities; provided that in either event continuance
is also approved by a majority of the Directors who are not interested persons
of the Fund, by a vote cast in person at a meeting called for the purpose of
voting on such approval. The Fund's Advisory Agreement may be terminated at any
time, on sixty days' written notice, without the payment of any penalty, by the
Board of Directors, by a vote of the majority of a Fund's outstanding voting
securities, or by the Adviser. The Advisory Agreement automatically terminates
in the event of its assignment, as defined by the 1940 Act and the rules
thereunder.
The name "Boyar" is a property right of the Adviser. The Adviser may
use the names "Boyar" in other connections and for other purposes, including in
the name of other investment companies. The Fund has agreed to discontinue any
use of the name "Boyar" if the Adviser ceases to be employed as the Fund's
investment adviser.
Administrator
- -------------
Countrywide Fund Services, Inc. (the "Administrator") serves as the
Fund's administrator and accounting, transfer, dividend disbursing, shareholder
service and plan agent pursuant to three written agreements (the "Agreements").
The services provided by, and the fees payable by the Fund to, the Administrator
under the Agreements are described in the Prospectus. See in the Prospectus,
"Management of the Fund."
Custodian
- ---------
Star Bank, N.A. (the "Custodian") serves as custodian of the Fund's
U.S. and foreign assets, pursuant to a custodian agreement (the "Custody
Agreement"). The services provided by the Custodian are described in the
Prospectus. Under the Custody Agreement, the Custodian will receive fixed fees ,
based on portfolio transactions, in addition to fees based on the market value
of the Fund's portfolio calculated at .03% on the first $20 million, .02% on the
next $20 million and .015% on any balance over $40 million. The Custodian's fees
are payable monthly and subject of a monthly minimum of $300. See in the
Prospectus, "Management of the Fund."
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<PAGE>
By its terms, the Custody Agreement will remain in force until
terminated. The Custody Agreement may be terminated at any time, on sixty days'
written notice, without the payment of any penalty, by the Board of Directors or
by the Custodian.
Organization of the Fund
- ------------------------
The Fund was incorporated on February 28, 1997 under the laws of the
State of Maryland under the name "Boyar Value Fund, Inc." The Fund's charter
authorizes the Board to issue one billion (1,000,000,000) shares of common
stock, $.001 par value per share (the "Shares").
All shareholders of the Fund, upon liquidation, will participate
ratably in the Fund's net assets. Shares do not have cumulative voting rights,
which means that holders of more than 50% of the shares voting for the election
of Directors can elect all Directors. Shares are transferable but have no
preemptive, conversion or subscription rights.
DISTRIBUTION AND SHAREHOLDER SERVICING
The Fund has entered into a Shareholder Servicing and Distribution
Plan (the "12b-1 Plan"), pursuant to Rule 12b-1 under the 1940 Act, pursuant to
which the Fund will pay the Distributor, in consideration for Services (as
defined below), a fee calculated at an annual rate of .25% of the average daily
net assets of the Fund. Services performed by the Distributor include (i)
ongoing servicing and/or maintenance of the accounts of shareholders of the
Fund, as set forth in the 12b-1 Plan ("Shareholder Services"), and (ii)
sub-transfer agency services, subaccounting services or administrative services
related to the sale of Shares, as set forth in the 12b-1 Plan ("Administrative
Services" and collectively with Shareholder Services, "Services") including,
without limitation, (a) payments reflecting an allocation of overhead and other
office expenses of the Distributor related to providing Services; (b) payments
made to, and reimbursement of expenses of, persons who provide support services
in connection with the distribution of Shares including, but not limited to,
office space and equipment, telephone facilities, answering routine inquiries
regarding the Fund, and providing any other Shareholder Services; (c) payments
made to compensate selected dealers or other authorized persons for providing
any Services; (d) costs of printing and distributing prospectuses, statements of
additional information and reports of the Fund to prospective shareholders of
the Fund; and (e) costs involved in obtaining whatever information, analyses and
reports with respect to service activities that the Fund may, from time to time,
deem advisable.
Pursuant to the 12b-1 Plan, the Distributor provides the Board with
periodic reports of amounts expended under the 12b-1 Plan and the purpose for
which the expenditures were made.
The 12b-1 Plan will continue in effect for so long as their
continuance is specifically approved at least annually by the Board, including a
majority of the Directors who
17
<PAGE>
are not interested persons of the Fund and who have no direct or indirect
financial interest in the operation of the 12b-1 Plan, as the case may be
("Independent Directors"). Any material amendment of the 12b-1 Plan would
require the approval of the Board in the manner described above. The 12b-1 Plan
may not be amended to increase materially the amount to be spent thereunder
without shareholder approval. The 12b-1 Plan may be terminated at any time,
without penalty, by vote of a majority of the Independent Directors or by a vote
of a majority of the outstanding voting securities of the Fund.
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION
The offering price of the Fund's shares is equal to the per share net
asset value of the shares of the Fund. Information on how to purchase and redeem
Fund shares and how such shares are priced is included in the Prospectus under
"How Net Asset Value is Determined."
Under the 1940 Act, the Fund may suspend the right of redemption or
postpone the date of payment upon redemption for any period during which the
NYSE is closed, other than customary weekend and holiday closings, or during
which trading on the NYSE is restricted, or during which (as determined by the
SEC) an emergency exists as a result of which disposal or fair valuation of
portfolio securities is not reasonably practicable, or for such other periods as
the SEC may permit.
If the Board determines that conditions exist which make payment of
redemption proceeds wholly in cash unwise or undesirable, the Fund may make
payment wholly or partly in securities or other investment instruments which may
not constitute securities as such term is defined in the applicable securities
laws. If a redemption is paid wholly or partly in securities or other property,
a shareholder would incur transaction costs in disposing of the redemption
proceeds. The Fund will comply with Rule 18f-1 promulgated under the 1940 Act
with respect to redemptions in kind.
ADDITIONAL INFORMATION CONCERNING TAXES
The following is a summary of the material United States federal
income tax considerations regarding the purchase, ownership and disposition of
shares in the Fund. Each prospective shareholder is urged to consult his own tax
adviser with respect to the specific federal, state, local and foreign tax
consequences of investing in the Fund. The summary is based on the laws in
effect on the date of this Statement of Additional Information, which are
subject to change.
The Fund and Its Investments
- ----------------------------
18
<PAGE>
The Fund and Its Investments. The Fund intends to continue to qualify
to be treated as a regulated investment company each taxable year under the
Internal Revenue Code of 1986, as amended (the "Code"). To so qualify, the Fund
must, among other things: (a) derive at least 90% of its gross income in each
taxable year from dividends, interest, payments with respect to securities,
loans and gains from the sale or other disposition of stock or securities or
foreign currencies, or other income (including, but not limited to, gains from
options, futures or forward contracts) derived with respect to its business of
investing in such stock, securities or currencies; (b) derive less than 30% of
its gross income from the sale or other disposition of (i) stock or securities
held for less than three months, (ii) options, futures or forward contracts held
for less than three months (other than options, futures, or forward contracts on
foreign currencies), and (iii) foreign currencies (or options, futures or
forward contracts on foreign currencies) held for less than three months, but
only if such currencies (or options, futures, or forward contracts) are not
directly related to the Fund's principal business of investing in stocks or
securities (or options and futures with respect to stocks or securities) (the
"30% Test"); and (c) diversify its holdings so that, at the end of each quarter
of the Fund's taxable year, (i) at least 50% of the market value of the Fund's
assets is represented by cash, securities of other regulated investment
companies, United States government securities and other securities, with such
other securities limited, in respect of any one issuer, to an amount not greater
than 5% of the Fund's assets and not greater than 10% of the outstanding voting
securities of such issuer and (ii) not more than 25% of the value of its assets
is invested in the securities (other than United States government securities or
securities of other regulated investment companies) of any one issuer or any two
or more issuers that the Fund controls and are determined to be engaged in the
same or similar trades or businesses or related trades or businesses. The Fund
expects that all of its foreign currency gains will be directly related to its
principal business of investing in stocks and securities.
The 30% Test will restrict the extent to which the Fund may, among
other things: (1) sell or purchase put options on securities held for less than
three months or purchase put options on substantially identical securities
(unless the option and the security are acquired on the same day); (2) write
options that expire in less than three months; and (3) close options that were
written or purchased within the preceding three months. For purposes of the 30%
Test, a Fund's increases or decreases in value of short-term investment
positions that constitute certain designated hedging transactions may generally
be netted. Effective for taxable years beginning after August 5, 1997, the
Taxpayer Relief Act of 1997 repealed the 30% Test. Accordingly, effective as of
the Fund's taxable year beginning January 1, 1998, the Fund will no longer be
required to comply with the 30% Test.
As a regulated investment company, the Fund will not be subject to
United States federal income tax on its net investment income (i.e., income
other than its net realized long- and short-term capital gains) and its net
realized long- and short-term capital gains, if any, that it distributes to its
shareholders, provided that an amount equal to at least 90% of the sum of its
investment company taxable income (i.e., 90% of its taxable income minus the
excess, if any, of its net realized long-term capital gains over its net
realized short-term capital losses (including any capital loss carryovers), plus
or minus certain other adjustments as
19
<PAGE>
specified in the Code) and its net tax-exempt income for the taxable year is
distributed, but will be subject to tax at regular corporate rates on any
taxable income or gains that it does not distribute. Furthermore, the Fund will
be subject to a United States corporate income tax with respect to such
distributed amounts in any year that it fails to qualify as a regulated
investment company or fails to meet this distribution requirement. Any dividend
declared by the Fund in October, November or December of any calendar year and
payable to shareholders of record on a specified date in such a month shall be
deemed to have been received by each shareholder on December 31 of such calendar
year and to have been paid by the Fund not later than such December 31, provided
that such dividend is actually paid by the Fund during January of the following
calendar year.
The Fund intends to distribute annually to its shareholders
substantially all of its investment company taxable income. The Board of
Directors of the Fund will determine annually whether to distribute any net
realized long-term capital gains in excess of net realized short-term capital
losses (including any capital loss carryovers). The Fund currently expects to
distribute any excess annually to its shareholders. However, if the Fund retains
for investment an amount equal to all or a portion of its net long-term capital
gains in excess of its net short-term capital losses and capital loss
carryovers, it will be subject to a corporate tax (currently at a rate of 35%)
on the amount retained. In that event, the Fund will designate such retained
amounts as undistributed capital gains in a notice to its shareholders who (a)
will be required to include in income for United Stares federal income tax
purposes, as long-term capital gains, their proportionate shares of the
undistributed amount, (b) will be entitled to credit their proportionate shares
of the 35% tax paid by the Fund on the undistributed amount against their United
States federal income tax liabilities, if any, and to claim refunds to the
extent their credits exceed their liabilities, if any, and (c) will be entitled
to increase their tax basis, for United States federal income tax purposes, in
their shares by an amount equal to 65% of the amount of undistributed capital
gains included in the shareholder's income. Organizations or persons not subject
to federal income tax on such capital gains will be entitled to a refund of
their pro rata share of such taxes paid by the Fund upon filing appropriate
returns or claims for refund with the Internal Revenue Service (the "IRS"). Even
if the Fund makes such an election, it is possible that it may incur an excise
tax as a result of not having distributed net capital gains.
The Code imposes a 4% nondeductible excise tax on the Fund to the
extent the Fund does not distribute by the end of any calendar year at least 98%
of its net investment income for that year and 98% of the net amount of its
capital gains (both long-and short-term) for the one-year period ending, as a
general rule, on October 31 of that year. For this purpose, however, any income
or gain retained by the Fund that is subject to corporate income tax will be
considered to have been distributed by year-end. In addition, the minimum
amounts that must be distributed in any year to avoid the excise tax will be
increased or decreased to reflect any underdistribution or overdistribution, as
the case may be, from the previous year. The Fund anticipates that it will pay
such dividends and will make such distributions as are necessary in order to
avoid the application of this tax.
20
<PAGE>
With regard to the Fund's investments in foreign securities, exchange
control regulations may restrict repatriations of investment income and capital
or the proceeds of securities sales by foreign investors such as the Fund and
may limit the Fund's ability to pay sufficient dividends and to make sufficient
distributions to satisfy the 90% and excise tax distribution requirements.
If, in any taxable year, the Fund fails to qualify as a regulated
investment company under the Code, it would be taxed in the same manner as an
ordinary corporation and distributions to its shareholders would not be
deductible by the Fund in computing its taxable income. In addition, in the
event of a failure to qualify, the Fund's distributions, to the extent derived
from the Fund's current or accumulated earnings and profits would constitute
dividends (eligible for the corporate dividends-received deduction) which are
taxable to shareholders as ordinary income, even though those distributions
might otherwise (at least in part) have been treated in the shareholders' hands
as long-term capital gains. If the Fund fails to qualify as a regulated
investment company in any year, it must pay out its earnings and profits
accumulated in that year in order to qualify again as a regulated investment
company. In addition, if the Fund failed to qualify as a regulated investment
company for a period greater than one taxable year, the Fund may be required to
recognize any net built-in gains (the excess of the aggregate gains, including
items of income, over aggregate losses that would have been realized if it had
been liquidated) in order to qualify as a regulated investment company in a
subsequent year.
The Fund's short sales against the box, if any, and transactions in
foreign currencies, forward contracts, options and futures contracts (including
options and futures contracts on foreign currencies) will be subject to special
provisions of the Code that, among other things, may affect the character of
gains and losses realized by the Fund (i.e., may affect whether gains or losses
are ordinary or capital), accelerate recognition of income to the Fund and defer
Fund losses. These rules could therefore affect the character, amount and timing
of distributions to shareholders. These provisions also (a) will require the
Fund to mark-to-market certain types of the positions in its portfolio (i.e.,
treat them as if they were closed out) and (b) may cause the Funds to recognize
income without receiving cash with which to pay dividends or make distributions
in amounts necessary to satisfy the distribution requirements for avoiding
income and excise taxes. The Fund will monitor its transactions, will make the
appropriate tax elections and will make the appropriate entries in its books and
records when it acquires any foreign currency, forward contract, option, futures
contract or hedged investment in order to mitigate the effect of these rules and
prevent disqualification of the Fund as a regulated investment company.
Passive Foreign Investment Companies. If the Fund purchases shares in
certain foreign investment entities, called "passive foreign investment
companies" (a "PFIC"), it may be subject to United States federal income tax on
a portion of any "excess distribution" or gain from the disposition of such
shares even if such income is distributed as a taxable dividend by the Fund to
its shareholders. Additional charges in the nature of interest may be imposed on
the Fund in respect of deferred taxes arising from such distributions or gains.
Any tax paid by
21
<PAGE>
the Fund as a result of its ownership of shares in a PFIC will not give rise to
any deduction or credit to the Fund or any shareholder. If the Fund were to
invest in a PFIC and elected to treat the PFIC as a "qualified electing fund"
under the Code, in lieu of the foregoing requirements, the Fund might be
required to include in income each year a portion of the ordinary earnings and
net capital gains of the qualified election fund, even if not distributed to the
Fund, and such amounts would be subject to the 90% and excise tax distribution
requirements described above. In order to make this election, the Fund would be
required to obtain certain annual information from the passive foreign
investment companies in which it invests, which may be difficult or not possible
to obtain.
Recently, legislation was enacted that provides a mark-to-market
election for regulated investment companies effective for taxable years
beginning after December 31, 1997. This election would result in the Fund being
treated as if it had sold and repurchased all of the PFIC stock at the end of
each year. In this case, the Fund would report gains as ordinary income and
would deduct losses as ordinary losses to the extent of previously recognized
gains. The election, once made, would be effective for all subsequent taxable
years of the Fund, unless revoked with the consent of the IRS. By making the
election, the Fund could potentially ameliorate the adverse tax consequences
with respect to its ownership of shares in a PFIC, but in any particular year
may be required to recognize income in excess of the distributions it receives
from PFICs and its proceeds from dispositions of PFIC company stock. The Fund
may have to distribute this "phantom" income and gain to satisfy its
distribution requirement and to avoid imposition of the 4% excise tax. The Fund
will make the appropriate tax elections, if possible, and take any additional
steps that are necessary to mitigate the effect of these rules.
Dividends and Distributions. Dividends of net investment income and
distributions of net realized short-term capital gains are taxable to a United
States shareholder as ordinary income, whether paid in cash or in shares.
Distributions of net-long-term capital gains, if any, that the Fund designates
as capital gains dividends are taxable as long-term capital gains, whether paid
in cash or in shares and regardless of how long a shareholder has held shares of
the Fund. Dividends and distributions paid by the Fund (except for the portion
thereof, if any, attributable to dividends on stock of U.S. corporations
received by the Fund) will not qualify for the deduction for dividends received
by corporations. Distributions in excess of the Fund's current and accumulated
earnings and profits will, as to each shareholder, be treated as a tax-free
return of capital, to the extent of a shareholder's basis in his shares of the
Fund, and as a capital gain thereafter (if the shareholder holds his shares of
the Fund as capital assets).
Shareholders receiving dividends or distributions in the form of
additional shares should be treated for United States federal income tax
purposes as receiving a distribution in the amount equal to the amount of money
that the shareholders receiving cash dividends or distributions will receive,
and should have a cost basis in the shares received equal to such amount.
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<PAGE>
Investors considering buying shares just prior to a dividend or
capital gain distribution should be aware that, although the price of shares
just purchased at that time may reflect the amount of the forthcoming
distribution, such dividend or distribution may nevertheless be taxable to them.
If the Fund is the holder of record of any stock on the record date
for any dividends payable with respect to such stock, such dividends are
included in the Fund's gross income not as of the date received but as of the
later of (a) the date such stock became ex-dividend with respect to such
dividends (i.e., the date on which a buyer of the stock would not be entitled to
receive the declared, but unpaid, dividends) or (b) the date the Fund acquired
such stock. Accordingly, in order to satisfy its income distribution
requirements, the Fund may be required to pay dividends based on anticipated
earnings, and shareholders may receive dividends in an earlier year than would
otherwise be the case.
Sales of Shares. Upon the sale or exchange of his shares, a
shareholder will realize a taxable gain or loss equal to the difference between
the amount realized and his basis in his shares. Such gain or loss will be
treated as capital gain or loss, if the shares are capital assets in the
shareholder's hands, and will be long-term capital gain or loss if the shares
are held for more than one year and short-term capital gain or loss if the
shares are held for one year or less. Any loss realized on a sale or exchange
will be disallowed to the extent the shares disposed of are replaced, including
replacement through the reinvesting of dividends and capital gains distributions
in the Fund, within a 61-day period beginning 30 days before and ending 30 days
after the disposition of the shares. In such a case, the basis of the shares
acquired will be increased to reflect the disallowed loss. Any loss realized by
a shareholder on the sale of a Fund share held by the shareholder for six months
or less will be treated for United States federal income tax purposes as a
long-term capital loss to the extent of any distributions or deemed
distributions of long-term capital gains received by the shareholder with
respect to such share.
Foreign Taxes. Income received by the Fund from non-U.S. sources may
be subject to withholding and other taxes imposed by other countries. Because it
is not expected that more than 50 percent of the value of the Fund's total
assets at the close of its taxable year will consist of stock and securities of
non-U.S. corporations, it is not expected that the Fund will be eligible to
elect to "pass through" to the Fund's shareholders the amount of foreign income
and similar taxes paid by the Fund. In the absence of such an election, the
foreign taxes paid by the Fund will reduce its investment company taxable
income, and distributions of investment company taxable income received by the
Fund from non-US sources will be treated as United States source income.
Backup Withholding. The Fund may be required to withhold, for United
States federal income tax purposes, 31% of the dividends and distributions
payable to shareholders who fail to provide the Fund with their correct taxpayer
identification number or to make required certifications, or who have been
notified by the IRS that they are subject to backup withholding. Certain
shareholders are exempt from backup withholding. Backup withholding
23
<PAGE>
is not an additional tax and any amount withheld may be credited against a
shareholder's United States federal income tax liabilities.
Notices. Shareholders will be notified annually by the Fund as to the
United States federal income tax status of the dividends, distributions and
deemed distributions attributable to undistributed capital gains (discussed
above in "The Fund and Its Investments") made by the Fund to its shareholders.
Furthermore, shareholders will also receive, if appropriate, various written
notices after the close of the Fund's taxable year regarding the United States
federal income tax status of certain dividends, distributions and deemed
distributions that were paid (or that are treated as having been paid) by the
Fund to its shareholders during the preceding taxable year.
Other Taxation
- --------------
Distributions also may be subject to additional state, local and
foreign taxes depending on each shareholder's particular situation.
THE FOREGOING IS ONLY A SUMMARY OF CERTAIN MATERIAL TAX CONSEQUENCES
AFFECTING THE FUND AND ITS SHAREHOLDERS. SHAREHOLDERS ARE ADVISED TO CONSULT
THEIR OWN TAX ADVISERS WITH RESPECT TO THE PARTICULAR TAX CONSEQUENCES TO THEM
OF AN INVESTMENT IN THE FUND.
DETERMINATION OF PERFORMANCE
From time to time, the Fund may quote its total returns in
advertisements or in reports and other communications to shareholders. These
figures are calculated by finding the average annual compounded rates of return
for the one-, five- and ten- (or such shorter period as the shares have been
offered) year periods that would equate the initial amount invested to the
ending redeemable value, according to the following formula: P (1 + T)n* = ERV.
For purposes of this formula, "P" is a hypothetical investment of $1,000; "T" is
average annual total return; "n" is number of years; and "ERV" is the ending
redeemable value of a hypothetical $1,000 payment made at the beginning of the
one-, five- or ten-year periods (or fractional portion thereof). Total return or
"T" is computed by finding the average annual change in the value of an initial
$1,000 investment over the period and assumes that all dividends and
distributions are reinvested during the period. The Fund may also advertise an
after-tax total return by reducing the ending redeemable value for any period by
applying the maximum federal tax rates against income, dividends and short-,
medium- and long-term capital gains distributions paid by and reinvested in the
Fund and calculating total return on the basis of this tax-adjusted ending
redeemable value.
The Fund may advertise, from time to time, comparisons of the
performance of its Shares with that of one or more other mutual funds with
similar investment objectives. The Fund may advertise average annual calendar
year-to-date and calendar quarter returns, which
- ----------------------
* - As used here, "n" is an exponent.
24
<PAGE>
are calculated according to the formula set forth in the preceding paragraph,
except that the relevant measuring period would be the number of months that
have elapsed in the current calendar year or most recent three months, as the
case may be.
The Fund may also advertise its yield. Yield is calculated by
annualizing the net investment income generated by the Fund over a specified
thirty-day period according to the following formula:
YIELD = 2[(a-b + 1)6** -1]
---
cd
For purposes of this formula: "a" is dividends and interest earned during the
period; "b" is expenses accrued for the period (net of reimbursements); "c" is
the average daily number of shares outstanding during the period that were
entitled to receive dividends; and "d" is the maximum offering price per share
on the last day of the period.
The performance of Fund shares will vary from time to time depending
upon market conditions, the composition of the Fund's portfolio and operating
expenses allocable to it. As described above, total return and yield are based
on historical earnings and are not intended to indicate future performance.
Consequently, any given performance quotation should not be considered as
representative of performance for any specified period in the future.
Performance information may be useful as a basis for comparison with other
investment alternatives. However, the Fund's performance will fluctuate, unlike
certain bank deposits or other investments which pay a fixed yield for a stated
period of time. Any fees charged by institutional investors directly to their
customers in connection with investments in Fund shares are not reflected in the
Fund's total return, and such fees, if charged, will reduce the actual return
received by customers on their investments.
INDEPENDENT ACCOUNTANTS AND COUNSEL
Ernst & Young LLP, with principal offices at 1330 Chiquita Center,
Cincinnati, Ohio, serves as independent accountants for the Fund. The statement
of assets and liabilities of the Fund, as of __, 1997 which has been audited by
Ernst & Young LLP appears in this Statement of Additional Information.
Willkie Farr & Gallagher, One Citicorp Center, 153 East 53rd Street,
New York, New York, 10022-4677, serves as counsel for the Fund as well as
counsel to the Manager and the Distributor.
FINANCIAL STATEMENT
The Fund's statement of assets and liabilities as of ______________,
1997, follows this Statement of Additional Information.
- ------------------
** - As used here, "6" is an exponent.
25
<PAGE>
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements -- *
(1) Financial Statements included in Part B
(A) Report of Independent Accountants
(B) Statement of Net Assets and Liabilities
(b) Exhibits:
Exhibit No. Description of Exhibit
- ----------- ----------------------
1 Articles of Incorporation.1
2 By-Laws.1
3 Not applicable.
4 Form of Share Certificate.*
5 Form of Investment Advisory Agreement.*
6(a) Form of Underwriting Agreement.*
(b) Form of Dealer's Agreement.*
7 Not applicable.
8 Form of Custody Agreement.*
9(a) Form of Management Agreement.*
(b) Form of Transfer, Dividend Disbursing, Shareholder
Service and Plan Agency Agreement.*
(c) Form of Administration Agreement.*
(d) Form of Accounting Services Agreement.*
10(a) Opinion and Consent of Willkie Farr & Gallagher, counsel to
the Fund.*
(b) Opinion and Consent of Venable, Baetjer and Howard, LLP,
Maryland counsel to the Fund.*
11 Consent of Ernst & Young LLP, Independent Accountants.*
12 Not applicable.
13 Form of Purchase Agreement.*
14 Not applicable.
15 Form of Shareholder Servicing and Distribution
Plan.*
C-2
<PAGE>
16 Not applicable.
17 Not applicable.
18 Not applicable.
- --------------------
1 Incorporated by reference to Registrant's Registration Statement
on Form N-1A, filed on June 13, 1997 (Securities Act File No.
333-29253).
* To be filed by amendment.
Item 25. Persons Controlled by or Under Common Control with Registrant
-------------------------------------------------------------
Not applicable.
Item 26. Number of Holders of Securities
-------------------------------
It is anticipated that Ladenburg Thalmann Fund Management Inc. will
hold all of the Registrant's shares of common stock, par value $.001 per share,
on the date Registrant's Registration Statement becomes effective.
Item 27. Indemnification
---------------
Registrant, officers and directors of Ladenburg Thalmann Fund
Management Inc., Boyar Asset Management, Inc. and Ladenburg Thalmann & Co. Inc.
and of Registrant are covered by insurance policies indemnifying them for
liability incurred in connection with the operation of Registrant. These
policies provide insurance for any "Wrongful Act" of an officer or director.
Wrongful Act is defined as breach of duty, neglect, error, misstatement,
misleading statement, omission or other act done or wrongfully attempted by an
officer, director or trustee in connection with the operation of Registrant.
Insurance coverage does not extend to (a) conflicts of interest or gain in fact
any profit or advantage to which one is not legally entitled, (b) intentional
non-compliance with any statute or regulation or (c) commission of dishonest,
fraudulent acts or omissions. Insofar as it related to Registrant, the coverage
is limited in amount and, in certain circumstances, is subject to a deductible.
Under Article VIII of the Articles or Incorporation (the "Articles"),
the Directors and officers of Registrant shall not have any liability to
Registrant or its stockholders for money damages, to the fullest extent
permitted by Maryland law. This limitation on liability applies to events
occurring at the time a person serves as a Director or officer of Registrant
whether or not such person is a Director or officer at the time of any
proceeding in which liability is asserted. No provision
C-3
<PAGE>
of Article VIII shall protect or purport to protect any Director or officer of
Registrant against any liability to Registrant or its stockholders to which he
would otherwise be subject by reason or willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of
his office. Registrant shall indemnify and advance expenses to its currently
acting and its former Director to the fullest extent that indemnification of
Directors and advancement of expenses to Directors is permitted by the Maryland
General Corporation Law.
Registrant shall indemnify and advance expenses to its officers to the
same extent as its Directors and to such further extent as is consistent with
such law. The Board of Directors may, through a by-law, resolution or agreement,
make further provisions for indemnification of directors, officers, employees
and agents to the fullest extent permitted by the Maryland General Corporation
Law.
Article VIII of the By-Laws further limits the liability of the
Directors by providing that any person who was or is a party or is threatened to
be made a party in any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, by reason
of the fact that such person is a current or former director or officer of
Registrant, or is or was serving while a director or officer of Registrant at
the request of Registrant as a director, officer, partner, trustee, employee,
agent or fiduciary of another corporation, partnership, joint venture, trust,
enterprise or employee benefit plan, shall be indemnified by Registrant against
judgments, penalties, fines excise taxes, settlements and reasonable expenses
(including attorneys' fees) actually incurred by such person in connection with
such action, suit or proceeding to the full extent permissible under the
Maryland General Corporation Law, the 1993 Act and the 1940 Act, as such
statutes are now or hereafter in force, except that such indemnity shall not
protect any such person against any liability to Registrant or any stockholder
thereof to which such person would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of this office.
Item 28. Business and Other Connections of
Investment Adviser
---------------------------------
Boyar Asset Management, Inc. is wholly owned by Mr. Mark A. Boyar and
acts as investment adviser to Registrant. Boyar Asset Management, Inc. renders
investment advice to a wide variety of individual and institutional clients. The
list required by this Item 28 of officers and directors of Boyar Asset
Management, Inc., together with information as to their other business,
profession, vocation or employment of a substantial nature during the past two
years, is incorporated by reference to Schedules A and D of Form ADV filed by
Boyar Asset Management, Inc. (SEC File No. 801-19283).
C-4
<PAGE>
Item 29. Principal Underwriter
---------------------
(a) Ladenburg Thalmann & Co. Inc. will act as distributor for
Registrant.
(b) For information relating to each director and officer of Ladenburg
Thalmann & Co. Inc., reference is made to Form BD (SEC File No. 8-16354) filed
by Ladenburg Thalmann & Co. Inc. under the Securities Exchange Act of 1934.
(c) None.
Item 30. Location of Accounts and Records
--------------------------------
(1) Boyar Value Fund, Inc.
590 Madison Avenue
New York, New York 10022
(Registrant's Articles of Incorporation,
By-Laws and minute books)
(2) Boyar Asset Management, Inc.
35 East 21st Street
New York, New York 10010
(records relating to its functions as investment adviser)
(3) Ladenburg Thalmann Fund Management Inc. 590 Madison
Avenue New York, New York 10022
(records relating to its functions as manager)
(4) Ladenburg Thalmann & Co. Inc.
590 Madison Avenue
New York, New York 10022
(records relating to its functions as distributor)
(5) Countrywide Fund Services, Inc.
312 Walnut Street
Cincinnati, Ohio 45202
(records relating to its functions as
administrator and transfer agent)
(6) Star Bank, N.A.
425 Walnut Street
Cincinnati, Ohio
(records relating to its functions as custodian)
Item 31. Management Services
-------------------
Not applicable.
C-5
<PAGE>
Item 32. Undertakings
------------
(a) Registrant hereby undertakes to file an amendment to the
Registration Statement with Certified financial statements showing the initial
capital received before accepting subscriptions from any persons in excess of 25
if Registrant proposes to raise its initial capital pursuant to Section 14(a)(3)
of the 1940 Act.
(b) Registrant hereby undertakes to file a post-effective amendment
using financial statements which need not be certified, within four to six
months from the effective date of the Registration Statement.
C-6
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, and the Investment Company Act of 1940, as amended, the Registrant has
duly caused this Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New York
and the State of New York, on the 18th day of November, 1997.
BOYAR VALUE FUND, INC.
By:/s/ Mark A. Boyar
Mark A. Boyar
Chairman and Chief
Executive Officer
Pursuant to the Securities Act of 1933, as amended, this Amendment has
been signed below by the following persons in the capacities and on the date
indicated:
Signature Title Date
- --------- ----- ----
/s/ Mark A. Boyar Chairman and November 18, 1997
Mark A. Boyar Chief Executive Officer
/s/ Jay R. Petschek President, Treasurer, November 18, 1997
Jay R. Petschek Chief Financial Officer
and Director
