Securities and Exchange Commission
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement [ ] Confidential, for Use of the
[X] Definitive proxy statement Commission Only (as permitted
[ ] Definitive additional materals by Rule 14a-6(e)(2))
[ ] Soliciting material pursuant to
Rule 14a-11(c) or Rule 14a-12
KEYCO BOND FUND, INC.
(Name of Registrant as Specified In Its Charter)
David W. Geiss, Esq.
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the filing fee is calculated and state how it was
determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any party of the fee is offset as provided by Exchange Act
Rule 1-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form of Schedule and the date of filing.
(1) Amount Previously Paid:
(2) Form Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
KEYCO BOND FUND, INC.
27777 Franklin Road, Suite 1850
Southfield, Michigan 48034
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held December 16, 1998
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
Keyco Bond Fund, Inc., a Michigan corporation (the "Company"), will be held
at the principal executive offices of the Company, 27777 Franklin Road,
Suite 1850, Southfield, Michigan, on Wednesday, December 16, 1998, at 11:00
a.m., E.S.T., for the following purposes:
(1) To elect five directors to serve until the next Annual
Meeting of Shareholders;
(2) To consider and act upon a proposal to ratify the
appointment of PricewaterhouseCoopers LLP as independent auditors
for the year ending September 30, 1999; and
(3) To transact such other business as may properly come
before the meeting or any adjournments thereof.
Information with respect to the above matters is set forth in the
Proxy Statement, dated November 20, 1998, which accompanies this Notice.
The Board of Directors has fixed the close of business on November
6, 1998, as the record date for determining shareholders entitled to notice
of and to vote at the Annual Meeting.
Please execute and promptly return the enclosed Proxy (i.e. yellow
sheet). Your designation of a proxy is revocable and will not affect your
right to vote in person in the event you find it convenient to attend the
meeting.
By Order of the Board of Directors
JOEL D. TAUBER
President
Southfield, Michigan
November 20, 1998
<PAGE>
KEYCO BOND FUND, INC.
27777 Franklin Road, Suite 1850
Southfield, Michigan 48034
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 16, 1998
This Proxy Statement and the accompanying form of proxy are to be
first mailed on or about November 20, 1998 to all shareholders of record on
November 6, 1998, and is furnished in connection with the solicitation of
proxies by the Board of Directors of Keyco Bond Fund, Inc., a Michigan
corporation (the "Company"), to be used at the Annual Meeting of
Shareholders to be held at 11:00 a.m., E.S.T., on Wednesday, December 16,
1998, and at any adjournments thereof.
Shares cannot be voted at the meeting unless the holder is present
in person or represented by proxy. Proxies are revocable by written notice
to the Secretary of the Company at any time prior to their exercise.
Proxies may also be revoked by a shareholder attending and voting in person
at the meeting. Shares of the Company's stock represented by any unrevoked
proxy in the enclosed form, if such proxy is properly executed and is
received prior to the meeting, will be voted in accordance with the
specifications made on such proxy or, if no specification has been made on
such proxy, will be voted for the election as directors of the nominees
listed herein and in favor of the proposal to ratify the selection of
auditors. The Board of Directors does not intend to present any other
matters at the Annual Meeting. However, should any other matters properly
come before the Annual Meeting, the proxy holders will have discretionary
authority to vote upon such matters and, in such event, it is the intention
of such proxy holders to vote the proxy in accordance with their best
judgment. For purposes of determining the number of votes cast with respect
to any voting matter, only those cast "for" or "against" are included.
Abstentions are counted only for purposes of determining whether a quorum is
present at the Annual Meeting. Broker non-votes are not counted for any
purpose. A majority of the outstanding shares of the Company, represented
in person or by proxy, will constitute a quorum at the meeting.
The Common Stock of the Company is the only class of securities
which is entitled to vote at the meeting. As of the close of business
November 6, 1998, the record date for determining shareholders who are
entitled to receive notice of and to vote at the meeting, there were
1,267,258 shares of Common Stock issued and outstanding. Each share is
entitled to one vote. The presence at the meeting, in person or by proxy,
of the holders of a majority of shares of stock of the Company is necessary
to constitute a quorum.
The cost of soliciting proxies, which may be conducted by mail,
telephone, in person or otherwise, will be borne by the Company. The
mailing address of the Company's principal executive offices is 27777
Franklin Road, Suite 1850, Southfield, Michigan 48034.
MATTERS TO COME BEFORE THE MEETING
(1) Election of Directors
Five directors are to be elected at the meeting. The directors of
the Company are elected annually by the shareholders, to serve until the
next annual meeting of shareholders or until their death, resignation, or
removal. The nominees named in the table below have each indicated a
willingness to serve if elected. If any nominee should be unable to serve
or is otherwise unavailable for election, and if any other persons are
nominated, the persons designated as "proxies" on the accompanying form of
proxy will have discretionary authority to vote or refrain from voting in
accordance with their judgment on such other nominees unless authority to
vote on such matter is withheld.
<TABLE>
<CAPTION>
Shares of Common Stock
Beneficially Owned
Principal Occupation Director Percent
Name and Age (Past five years) Since Number of Class
- ------------ -------------------- -------- ------ --------
<S> <C> <C> <C> <C>
Gail A. Dishell, 62(1) Vice President of the Company since 1984 469,529(2) 37.1%
September 1979; Investor
Mark E. Schlussel, 58 Of Counsel to the firm of Pepper, Hamilton and 1979 -0-
Scheetz, attorneys (since January 1995) (Detroit,
Michigan); previously Partner in firm of Miller,
Canfield, Paddock and Stone, attorneys (from
October 1990 to January 1995) (Detroit, Michigan)
David K. Page, 65 Partner in the firm of Honigman Miller Schwartz 1989 -0-
and Cohn, attorneys (Detroit, Michigan)
Thomas E. Purther, 33(1) Partner in Key Homes, residential housing builder 1994 24,715(3) 2.0%
(since December 1993) (Bingham Farms, Michigan),
Vice Chairman and Chief Executive Officer of
Paramount Bancorp, residential mortgage lender
(since June 1996) (Bingham Farms, Michigan) and
Chief Executive Officer of Global Commercial
Credit, LLC, business receivables insurance agency
(since March 1996) (Bingham Farms, Michigan);
previously financial analyst for Keywell Corporation
(scrap metal) (from September 1991 to December
1993) (Chicago, Illinois)
Ellen T. Horing, 36(1) Portfolio manager of Highgate Partners, an 1995 53,477(4) 4.2%
investment partnership (since January 1993)
(Mt. Kisco, New York); previously Director of
Research and Vice President, Gabelli Funds, Inc.
(mutual funds) (from August 1988 to August 1992)
(Rye, New York)
</TABLE>
- ---------------
1 Ms. Dishell, Mr. Purther and Ms. Horing are "interested persons" as
defined in Section 2(a)(19) of the Investment Company Act of 1940
because of their status as an officer, director, holder of more than
5% of the Company's Common Stock and/or the immediate family member
of any of the foregoing.
2 Includes certain shares pursuant to which Ms. Dishell is sole
trustee. See "Principal Shareholders." Does not include 1,000
shares held by Ms. Dishell's husband, as to which she disclaims any
beneficial ownership.
3 These shares are held in a trust for the benefit of Mr. Purther; Ms.
Barbara J. Keywell (formerly Ms. Barbara J. Purther) serves as the
sole trustee of such trust with voting and dispositive powers. See
"Principal Shareholders."
4 These shares are held in a trust for the benefit of Ms. Horing; Ms.
Shelby M. Tauber and Mr. Joel D. Tauber serve as co-trustees of such
trust with voting and dispositive powers. See "Principal
Shareholders."
All directors and officers of the Company, as a group, beneficially
own 1,257,283 shares (99.2%) of the Company's outstanding Common Stock. See
"Principal Shareholders."
All of the nominees were previously elected as directors at the last
annual meeting of shareholders. Shelby M. Tauber, Barbara J. Keywell and
Gail A. Dishell, each of whom is an officer and/or a director and a
principal shareholder, are sisters. In addition, Thomas E. Purther is the
son of Ms. Keywell, and Ms. Horing is the daughter of Ms. Tauber. The Board
of Directors has no committees. Directors who are not "interested persons"
of the Company as defined in the Investment Company Act of 1940 (i.e.,
Messrs. Schlussel and Page) are presently paid a fee of $1,000 per meeting.
During the year ended September 30, 1998, the Board of Directors met once
and all directors were present. During the year ended September 30, 1998,
no remuneration of any form was paid to the Company's officers or directors,
other than as described above with respect to the Company's two outside
directors.
The nominees receiving a plurality of votes cast at the meeting will
be elected directors.
(2) Ratification of Appointment of Auditors
The directors of the Company who are not "interested persons" have
unanimously appointed PricewaterhouseCoopers LLP, independent public
accountants, to audit the financial statements of the Company for the
current fiscal year ending September 30, 1999. This firm served in such
capacity for the year ended September 30, 1998, and has no direct or
indirect interest in the Company other than as its auditors and independent
accountants. This appointment will be submitted to shareholders at the
meeting for ratification. The affirmative vote of a majority of the shares
of Common Stock present at the meeting is required to so appoint
PricewaterhouseCoopers LLP as the Company's auditors. A representative of
PricewaterhouseCoopers LLP is not expected to be present at the meeting.
FURTHER INFORMATION
Principal Shareholders
The following table sets forth certain information concerning those
persons who were, on November 6, 1998, believed by the Company to be
beneficial owners of more than 5% of the outstanding shares of the Company's
Common Stock, and also sets forth certain information about ownership of
shares of Common Stock by all directors and officers of the Company as a
group:
<TABLE>
<CAPTION>
Name and Address Shares Beneficially Owned
of Beneficial Owner Nature of Beneficial Ownership Number Percent
- ------------------- ------------------------------ ------ -------
<S> <C> <C> <C>
Shelby M. Tauber Shares as to which Ms. Tauber exercises sole voting
150 East 69th Street and investment powers 226,904
Apartment 27
New York, NY
Shares held in various trusts pursuant to which Ms.
Tauber and Joel D. Tauber are co-trustees with voting
and investment powers 144,186
-------
371,090 29.3%
======= =====
Barbara J. Keywell Shares as to which Ms. Keywell exercises sole voting
2200 Tottenham and investment powers 253,882
Bloomfield Hills, MI
Shares held in various trusts pursuant to which Ms.
Keywell is sole trustee with voting and investment
powers 96, 942
-------
350,824 27.7%
======= =====
Gail A. Dishell Shares as to which Ms. Dishell exercises sole voting
26721 Carol and investments powers 251,644
Franklin, MI
Shares held in various trusts pursuant to which Ms.
Dishell is sole trustee with voting and investment
powers 217,885
-------
469,529(1) 37.1%
======= =====
Joel D. Tauber Shares as to which Mr. Tauber exercises sole voting
2991 Long Ridge Ct. and investment powers 65,840
West Bloomfield, MI
Shares held in various trusts pursuant to which Mr.
Tauber and Shelby M. Tauber are co-trustees with
voting and investment powers 144,186
-------
210,026 16.6%
======= =====
- ---------------
</TABLE>
1 Does not include 1,000 shares held by Ms. Dishell's husband, as to
which she disclaims any beneficial ownership.
All directors and officers of the Company, as a group, beneficially
own 1,257,283 shares (99.2%) of the Company's outstanding Common Stock.
Executive Officers
Set forth below is certain information concerning the Company's
present executive officers, including name, age, principal occupation and
business experience during the past five years, and length of service as an
officer of the Company:
Name and Age Office and Term of Service
Joel D. Tauber, 63 President since October 1995. Also
a manufacturing executive, business
consultant and investor since prior to
1993; Chairman of the Board of Complex
Tooling & Molding, Inc. (Boulder,
Colorado) since March 1996; Co-Chairman
of the Board of Key Plastics, Inc. Novi,
Michigan) since July 1995 (previously
Chairman of the Board since prior to
1993 through July 1995); Co-Chairman of
the Board of Keywell Corporation
(Chicago, Illinois) since April 1992;
Chairman of the Board of KMGI, Inc.
(formerly Key Manufacturing Group, Inc.)
(Southfield, Michigan) since prior to
1993
Gail A. Dishell, 62 Vice President since September 1979
Shelby M. Tauber, 63 Treasurer since September 1979
Barbara J. Keywell, 58 Secretary since September 1979
Except as described above, none of the Company's executive officers
have been employed in a principal occupation for the past five years.
Information Concerning Investment Matters
Determination Not to Use Investment Adviser; Termination of
Investment Advisory Contract
At its October 19, 1994 meeting, the Board of Directors decided not
to retain the services of an outside investment adviser and, instead,
determined that the Company, acting through its officers and with the review
provided by the Board, will make investment decisions internally on a going-
forward basis.
The Board's decision not to retain the services of an investment
adviser was made after careful deliberation and was based upon several
factors, including the following:
- The Company's investment objectives are relatively clear-cut
and uncomplicated. The Company's primary investment
objective, as reported in prior filings with the Securities
and Exchange Commission, is "to receive as high a level of
current interest income exempt from federal income taxes as
is available from Municipal Bonds (as defined therein) and
as is consistent with prudent investment management and
preservation of capital, and capital appreciation will be a
minor investment objective of the Company." As a result of
this objective, the Company invests in high quality bonds
which typically have relatively low turnover.
- Given the relatively low turnover in investment securities,
the Board has been able to closely monitor the investment
activity of the Company.
- The fees charged by potential third party investment
advisers were relatively high and, in light of the net
benefit to be provided to the Company, unacceptable.
As a result of its decision not to retain an outside investment
adviser, the Company and Comerica Bank (the "Bank"), effective as of October
19, 1994, terminated the Management and Custodial Agreement, dated September
5, 1979, pursuant to which Agreement the Bank had been providing certain
investment advisory and custodial account services to the Company.
Following such termination, however, the Company and the Bank entered into a
new Custodial Account Agreement, dated October 19, 1994, pursuant to which
the Bank shall continue to provide certain custodial account services for
the Company.
Portfolio -- Allocation and Transactions
The Company's investment portfolio has consisted, and will continue
to consist of, debt obligations issued by states, counties, cities and their
political subdivision or agencies, the interest on which is exempt from
federal income tax in the opinion of bond counsel to the issuer ("Municipal
Bonds"). Municipal Bonds are normally traded in the over-the-counter market
on a net basis (without commissions) through dealers acting for their own
account and not as brokers. Because of this fact, there are no stated
commissions charged with respect to trades for transactions in the Company's
portfolio securities.
When purchasing or selling Municipal Bonds, the Company seeks to
obtain the prompt execution of orders at the most favorable prices
available. To the extent that, in the Company's experience, the execution
capabilities and prices offered by more than one dealer have been
comparable, the Company may, in its discretion, choose to purchase and sell
Municipal Bonds from and to dealers who provide research, statistical and
other information to the Company. However, it is not the Company's policy
to pay a higher price to a dealer solely because it has supplied these
services. Although this type of information is useful to the Company, it is
believed that such services will not reduce the Company's normal research
activities. The Company believes that the types of research services and
information which will be provided by dealers will consist principally of
research reports on particular issues of Municipal Bonds and technical
information concerning general market conditions for Municipal Bonds.
Certain Reporting Requirements
Under the federal securities laws, the Company's directors, its
executive officers, and any persons holding more than 10% of the Company's
Common Stock (collectively, the "Reporting Persons") are required to file
reports with the Securities and Exchange Commission, and to provide the
Company with copies of same, relative to their ownership of the Common
Stock, which reports need to be filed at such time as they first become a
Reporting Person and at such time or times as any changes occur in their
beneficial ownership of the Common Stock. Specific due dates for filing
these reports have been established and the Company is required to disclose
in this Proxy Statement any failure to timely file these reports.
Based on a review of the reports filed by the Reporting Persons,
during and with respect to the fiscal year ended September 30, 1998, and/or
on representations of its Reporting Persons with respect to the fiscal year
ended September 30, 1998, the Company believes that the foregoing reporting
requirements have been satisfied by the Company's Reporting Persons.
Other Matters and Shareholder Proposals
At the date of this Proxy Statement, management is not aware of any
matters to be presented for action at the meeting other than those described
above. However, if any other matters should come before the meeting, it is
the intention of the persons named in the accompanying proxy card to vote in
accordance with their judgment on such matters.
Any proposals of shareholders to be presented at the next Annual
Meeting of Shareholders which are eligible for inclusion in the Company's
proxy statement for that meeting under applicable rules of the Securities
and Exchange Commission must be received by the Company at its principal
executive offices not later than 120 days prior to November 19, 1999.
Southfield, Michigan
November 20, 1998
<PAGE>
KEYCO BOND FUND, INC.
PROXY SOLICITED BY BOARD OF DIRECTORS
Annual Meeting of Shareholders
To Be Held December 16, 1998
The undersigned shareholder hereby appoints JOEL D. TAUBER and
KENNETH E. KLUSKA, or either one of them, proxies with the power of
substitution to vote, as designated below, all shares of Common Stock which
the undersigned may be entitled to vote at the Annual Meeting of the
Shareholders to be held on Wednesday, December 16, 1998 at 11:00 a.m., or at
any adjournment thereof, on the following matters described in the Proxy
Statement dated November 20, 1998.
1. ELECTION OF DIRECTORS:
[ ] FOR all nominees listed below or [ ] WITHHOLD AUTHORITY
any substitute for any of them. to vote for all nominees
listed below.
(To withhold authority to vote for any one nominee strike through
his or her name below)
Gail A. Dishell Mark E. Schlussel
Thomas E. Purther David K. Page
Ellen T. Horing
2. RATIFYING THE SELECTION of PricewaterhouseCoopers LLP as independent
auditors for the year ending September 30, 1999.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
The undersigned instructs the proxies to vote as specified in the
proxy on the matters described in the Proxy Statement dated November 20,
1998. Proxies will be voted as instructed.
Authority is also granted to such proxies to vote in their
discretion upon any other business which may properly come before the
meeting. If no specification is made, proxies will vote as follows: (i)
under Item 1, FOR election of the nominees named above or any substituted
for any of them; and (ii) FOR Item 2.
Receipt is hereby acknowledged of the Notice of Annual Meeting of
Shareholders and Proxy Statement, each dated November 20, 1998.
Dated: ----------------------------, 1998
------------------------------------------
Signature
------------------------------------------
Signature
Please sign exactly as name appears hereon.
If the stock is registered in the names of
two or more persons, each should sign.
Executors, administrators, trustees,
guardians, attorneys and corporate officers
should add their titles.
