BULL & BEAR GOLD INVESTORS LTD.
July __, 1995
Fellow Shareholder:
Enclosed is the proxy statement and proxy card for a Special Meeting of
Shareholders of Bull & Bear Gold Investors (the "Fund"). Please take this
opportunity to review the proxy statement and sign and return the proxy card in
the special window pouch inside the large mailing envelope. Your vote is
important and must be counted, no matter how many or how few shares you own. The
Board of Directors recommends that you vote in favor of the proposals.
About the Proposals
The Board of Directors is asking shareholders to consider a Subadvisory
Agreement between Bull & Bear Advisers, Inc. (the "Investment Manager") and Lion
Resource Management Limited ("Lion") pursuant to which Lion would advise and
consult with the Investment Manager regarding investments with respect to the
Fund. Shareholders are also being asked to consider the election of Directors of
the Fund.
Your Vote is Important - Please Return the Proxy Card Promptly
Your vote is extremely important and I urge you to complete and return
promptly the proxy card using the enclosed postage paid envelope. If you have
any questions, please call our Shareholder Service Representatives at
1-800-847-4200, who will be happy to assist you.
Sincerely,
Thomas B. Winmill
Co-President
<PAGE>
BULL & BEAR GOLD INVESTORS LTD.
11 HANOVER SQUARE
NEW YORK, NEW YORK 10005
----------
NOTICE OF
SPECIAL MEETING OF SHAREHOLDERS
to be Held on August __, 1995
----------
TO THE SHAREHOLDERS:
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders of Bull &
Bear Gold Investors Ltd. ("Fund") will be held at the offices of the Fund at 11
Hanover Square, New York, New York 10005, on August __, 1995 at _____ a.m., for
the following purposes:
1. Approval or Disapproval of a Subadvisory Agreement (Proposal 1);
2. Election of Directors (Proposal 2); and
3. To transact such other business as may properly come before the
meeting.
You are entitled to vote at the meeting and any adjournment thereof if you owned
Fund shares at the close of business on ________, 1995. If you do not expect to
attend the meeting, please complete, date, sign and return the enclosed proxy
card in the enclosed postage paid envelope.
By order of the Board of Directors,
-----------------------------------
William J. Maynard
Secretary
July __, 1995
YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN.
In order to avoid the additional expense of further solicitations, we ask your
cooperation in mailing in your proxy card promptly if you do not expect to
attend the meeting. No postage is necessary.
<PAGE>
BULL & BEAR GOLD INVESTORS LTD.
11 HANOVER SQUARE
NEW YORK, NEW YORK 10005
1-800-847-4200
----------
PROXY STATEMENT
Special Meeting of Shareholders
to be Held on August __, 1995.
----------
VOTING INFORMATION
This proxy statement is furnished to the shareholders of Bull & Bear
Gold Investors Ltd. ("Fund") in connection with the Board of Directors'
solicitation of proxies to be used at the special meeting of the shareholders of
the Fund to be held on August __, 1995, or any adjournment or adjournments
thereof (such meeting and any adjournment being referred to as the "Meeting").
One-third of the shares outstanding on _______, 1995, the record date
("Record Date"), represented in person or by proxy, must be present to form a
quorum for the transaction of business at the Meeting. In the event that a
quorum is present at the Meeting but sufficient votes to approve any of the
proposals are not received, the persons named as proxies may propose one or more
adjournments of the Meeting to permit further solicitation of proxies. Any such
adjournment will require the affirmative vote of a majority of those shares
represented at the Meeting in person or by proxy. If a quorum is present, the
persons named as proxies will vote those proxies which they are entitled to vote
for any such proposal in favor of such an adjournment and will vote those
proxies required to be voted against any such proposal against such adjournment.
A shareholder vote may be taken on one or more of the proposals in this proxy
statement prior to any such adjournment if sufficient votes have been received
and it is otherwise appropriate.
The persons named as proxies on the enclosed proxy card will vote in
accordance with your direction as indicated thereon if your proxy card is
received properly executed. If you give no voting instructions, your shares will
be voted in favor of the nine nominees for directors named herein and in favor
of the remaining proposals described in this proxy statement. The proxy card may
be revoked by giving another proxy, by letter or telegram revoking your proxy
received by the Fund prior to the meeting or by appearing and voting at the
meeting. Broker non-votes are shares held by a broker or nominee as to which the
broker or nominee indicates that instructions have not been received from the
beneficial owners or persons entitled to vote and the broker or nominee does not
have discretionary voting authority. Abstentions and broker non-votes will be
counted as shares present for determining whether a quorum is present but will
not be voted for or against any adjournment or proposal. Accordingly,
abstentions and broker non-votes effectively will be a vote against adjournment
or against any proposal where the required vote is a percentage of shares
present.
As of the Record Date, the Fund had ___ shares of common stock
outstanding. Management does not know of any person who owns beneficially 5% or
more of the Fund shares. The Directors and Officers of the Fund own in the
aggregate less than 1% of the Fund's shares.
1
<PAGE>
This proxy statement will first be mailed to shareholders on or about
July __, 1995. A shareholder may receive copies of the Fund's most recent annual
and semi-annual reports free of charge by contacting the Fund's distributor,
Investor Service Center, Inc. at 11 Hanover Square, New York, New York10005 or
by calling 1-800-847-4200.
Required Votes
Approval of the Subadvisory Agreement requires the affirmative vote of
a "majority of the outstanding voting securities" of the Fund. As defined in the
Investment Company Act of 1940 ("1940 Act"), "majority of the outstanding voting
securities" means the lesser of (1) 67% of the Fund's shares present at a
meeting of shareholders if the owners of more than 50% of the Fund's shares then
outstanding are present in person or by proxy, or (2) more than 50% of the
Fund's outstanding shares. The favorable vote of a plurality of the shares
present at the meeting in person or by proxy, provided a quorum is present, is
required by the Fund's By-Laws for the election of Directors. Each full
outstanding share of the Fund is entitled to one vote, and each outstanding
fractional share of the Fund is entitled to a proportionate fractional share of
one vote.
The Board of Directors unanimously approved these proposals and
recommends that you vote in favor of them.
PROPOSAL 1: APPROVAL OR DISAPPROVAL OF A SUBADVISORY AGREEMENT
Bull & Bear Adviser, Inc., the Investment Manager of the Fund, proposes
to enter into a Subadvisory Agreement with Lion Resource Management Limited (the
"Subadviser"), under which the Subadviser would advise and consult with the
Investment Manager regarding investments with respect to the Fund. Under such
arrangements, the Investment Manager would retain responsibility for making
specific investment decisions on behalf of the Fund. The Subadviser has not
served directly as an investment adviser to a U.S. mutual fund, although the
Managing Director of the Subadviser, Kjeld Thygesen, has been the portfolio
manager of Excel Midas Gold Shares, Inc. ("Excel Midas Fund") since January
1992. If the Subadvisory Agreement is approved, Mr. Thygesen would serve,
together with the Investment Policy Committee of the Investment Manager, as a
portfolio manager of the Fund. The Subadvisory Agreement is subject to, and
contingent upon, the approval of the Subadvisory Agreement by shareholders of
the Fund. The form of the Subadvisory Agreement is attached as Exhibit A.
Under the terms of the Subadvisory Agreement, the Subadviser will
advise and consult with the Investment Manager regarding the selection, clearing
and safekeeping of the Fund's portfolio investments and assist in pricing and
generally monitoring such investments. The Subadviser also will provide the
Investment Manager with advice as to allocating the Fund's portfolio assets
among various countries, including the United States, and among equities,
bullion, and other types of investments, including recommendations of specific
investments.
In consideration of the Subadviser's services, the Investment Manager,
and not the Fund, will pay to the Subadviser a percentage of the Investment
Manager's Net Fees. "Net Fees" are defined as the actual amounts received by the
Investment Manager as compensation less reimbursements, if any, pursuant to the
guaranty of the investment management agreement between the Investment Manager
and the Fund (the "Investment Management Agreement") and waivers of such
compensation by the Investment Manager. The amount of the percentage is
determined by the grid and accompanying definitions set forth as follows:
2
<PAGE>
<TABLE>
<CAPTION>
=====================================================================
RELATIVE PERFORMANCEa
- - - -------------------------------------------------------------------------------------------------------------------
TOTAL NET ASSETSb More than 50 basis Within 50 basis More than 50
points better than points of BTR basis points below
BTR BTR
- - - -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
<= $50,000,000 30% 17.5% 5%
- - - -------------------------------------------------------------------------------------------------------------------
> $50,000,000 and 40% 30% 20%
<= $150,000,000
- - - -------------------------------------------------------------------------------------------------------------------
> $150,000,000 and 45% 35% 25%
<= $250,000,000
- - - -------------------------------------------------------------------------------------------------------------------
> $250,000,000 50% 40% 30%
===================================================================================================================
</TABLE>
a. "Relative Performance" is determined from comparing the total
return performance of the Fund and the total return
performance of the "Benchmark Performance" of the objective
category of "precious metals" funds ("BTR") as determined by
Morningstar, Inc., or, if unavailable, other similar service
acceptable to the parties and the Fund. The Relative
Performance is determined as of the last calendar day of each
month ("Performance Determination Date") and measures the
Relative Performance for the most recent 12 month period
("Measurement Period"), except that for the first 12 months of
the Subadvisory Agreement, Relative Performance is based upon
annualized returns, the first three Performance Determination
Dates are the next three calendar quarter ends after the
effective date of the Subadvisory Agreement, and the
Measurement Periods are the most recent three months and the
fourth Performance Determination Date is the next calendar
quarter end and the Measurement Period is the most recent
twelve months.
b. "Total Net Assets" is the total net assets of the Fund as of
the Performance Determination Date.
The foregoing fee structure will result in the amount of the investment
management fee retained by the Investment Manager varying depending on the
performance, as well as the size, of the Fund. At each asset level on the fee
schedule, the Investment Manager will retain a greater portion of its fee when
the Fund underperforms the BTR by more than 50 basis points than when the Fund
outperforms the BTR by more than 50 basis points.
The Subadvisory Agreement provides that it is not assignable and
automatically terminates in the event of its assignment, or in the event of the
termination of the Investment Management Agreement. The Subadvisory Agreement
may also be terminated without penalty on 60 days' written notice at the option
of either party thereto or by the Fund, by the Board of Directors of the Fund or
by a vote of shareholders of the Fund. The Subadvisory Agreement further
provides that the Subadviser shall not be liable to the Fund for any error of
judgment or mistake of law or for any loss suffered by the Fund in connection
with any investment policy or the purchase, sale or retention of any security on
the recommendation of the Subadviser. Nothing contained in the Subadvisory
Agreement, however, shall be construed to protect the Subadviser against any
liability to the Fund by reason of the Subadviser's willful misfeasance, bad
faith or gross negligence or by reason of its reckless disregard of its
obligations and duties under the Subadvisory Agreement.
3
<PAGE>
If the Subadvisory Agreement is approved by the Fund's shareholders,
the Subadvisory Agreement shall continue from year to year if approved annually
by (a) the Board of Directors of the Fund or by vote of a majority of the
outstanding voting securities of the Fund as defined in the 1940 Act and (b) a
vote of a majority of the Directors of the Fund who are not parties to the
Subadvisory Agreement or "interested persons" of any such party as defined in
the 1940 Act.
In considering the proposed Subadvisory Agreement for approval, the
Board of Directors reviewed, among other things, the nature, quality and scope
of the services currently provided to the Fund by the Investment Manager, the
nature and scope of the services to be provided to the Fund by the Investment
Manager and the Subadviser, and the ability of the Investment Manager and the
Subadviser to provide such services. In particular, the Board considered the
performance by the Fund as well as the performance experienced by Excel Midas
Fund during the period when Kjeld Thygesen served as the portfolio manager of
that Fund. The Board of Directors also reviewed the fees to be paid to the
Subadviser by the Investment Manager. In this regard, the Board considered the
fact that under the proposed fee structure, the Investment Manager would pass on
a lower portion of its fee to the Subadviser when the Fund underperforms the BTR
by more than 50 basis points than when the Fund outperforms the BTR by more than
50 basis points. The Board of Directors determined that the Subadvisory
Agreement's fee structure was fair and reasonable in light of the nature of the
services to be provided.
Additional Information About the Subadviser
The Subadviser, whose principal business address is 7-8 Kendrick Mews,
London, U.K. SW7 3HG, is controlled by Kjeld Thygesen and Lion Mining Finance
Limited ("Lion Mining") who own 40% and 60%, respectively, of the outstanding
voting securities of the Subadviser. Lion Mining is owned by Andrew F. Malim
(75%) and Jorge A. Nicanovich (25%). The address of Messrs. Thygesen and Malim
and Lion Mining is 7-8 Kendrick Mews, London, U.K. SW7 3HG. The address of Mr.
Nicanovich is ______________________.
The principal executive officer and directors of the Subadviser, their
respective offices and principal occupations are set forth below.
Kjeld Thygesen -- Managing Director. Mr. Thygesen's principal occupation is as
an investment adviser.
Andrew F. Malim -- Director. Mr. Malim's principal occupation is as a corporate
finance adviser.
Additional Information About the Investment Manager
The Investment Manager, whose principal business address is 11 Hanover
Square, New York, New York 10005, is a wholly owned subsidiary of Bull & Bear
Group, Inc. ("Group"). Group is a publicly owned company whose securities are
listed on the Nasdaq and traded in the over-the-counter market. Bassett S.
Winmill may be deemed a controlling person of Group on the basis of his
ownership of 100% of Group's voting stock and, therefore, of the Investment
Manager. The principal executive officer of the Investment Manager is Thomas B.
Winmill. The Directors of the Investment Manager are Robert D. Anderson, Mark C.
Winmill and Thomas B. Winmill. Their respective principal occupations are as
officers of Group and its subsidiaries. The address of each Director is 11
Hanover Square, New York, New York 10005.
The Investment Manager serves as Investment Manager to the Fund
pursuant to an investment advisory agreement dated _________ that was last
approved by the shareholders of the Fund on ______________. Under the Investment
Management Agreement, the Investment Manager receives a fee, payable monthly,
4
<PAGE>
based on the average daily net assets of the Fund at the annual rate of 1% on
the first $10 million, .875% from $10 million to $30 million, .75% from $30
million to $150 million, .625% from $150 million to $500 million, and .50% over
$500 million. For the fiscal year ended June 30, 1995, the Fund paid fees under
the Investment Management Agreement of $__________.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR PROPOSAL 1.
---
PROPOSAL 2: ELECTION OF DIRECTORS
The following persons have been nominated for election as Directors of
the Fund and each has consented to his nomination and agreed to serve if
elected. Each nominee is presently a Director of the Fund. The selection and
nomination of each person for election as a Director who is not an interested
person of the Fund as defined in the 1940 Act was made by the Directors of the
Fund who are not interested persons of the Fund. If any of the nominees should
not be available for election, the persons named as proxies may vote for other
persons in their discretion. Management has no reason to believe that any
nominee will be unavailable for election.
BASSETT S. WINMILL* -- Chairman of the Board ( - present). He is Chairman of
the Board of the other four investment companies in the Bull & Bear Funds
Complex (the "Bull & Bear Funds Complex") and of the parent of the Investment
Manager, Bull & Bear Group, Inc. ("Group"). He was born February 10, 1930. He is
a member of the New York Society of Security Analysts, the Association for
Investment Management and Research and the International Society of Financial
Analysts. He is the father of Mark C. Winmill and Thomas B. Winmill. He owns __
shares of the Fund.
ROBERT D. ANDERSON -- Vice Chairman and Director ( - present). He is Vice
Chairman and a Director of Bull & Bear Funds Complex and of the Investment
Manager and its affiliates. He was born December 7, 1929. He is a member of the
Board of Governors of the Mutual Fund Education Alliance, and of its
predecessor, the No-Load Mutual Fund Association. He has also been a member of
the District #12, District Business Conduct and Investment Companies Committees
of the NASD. He owns __ shares of the Fund.
RUSSELL E. BURKE III -- Director ( - present). 36 East 72nd Street, New
York, NY 10021. He is President of Russell E. Burke III, Inc. Fine Art, New
York, New York. From 1988 to 1991, he was President of Altman Burke Fine Arts,
Inc. From 1983 to 1988, he was Senior Vice President of Kennedy Galleries. He is
also a Director of certain of the other Bull & Bear Funds. He owns __ shares of
the Fund.
BRUCE B. HUBER, CLU -- Director ( - present). 298 Broad Street, Red Bank,
New Jersey 07701. He is President of Huber-Hogan Consulting, Inc. financial
consultants and insurance planners. He was born February 7, 1930. From 1988 to
1990, he was Chairman of Bruce Huber Associates. From 1987 to 1988, he was
Chairman of Economic Benefits Corporation, and prior thereto President of Bruce
Huber Associates, Inc., a financial and insurance consulting firm specializing
in estate, corporate, and executive benefit planning. He is also a Director of
the Bull & Bear Funds Complex. He owns ____ shares of the Fund.
JAMES E. HUNT -- Director ( - present). One Dag Hammarskjold Plaza, New
York, New York 10017. He is a principal of Kenny, Kindler, Hunt & Howe, Inc.,
executive recruiting consultants. He was born December 14, 1930. From 1976 until
1983 he was Vice President of Russell Reynolds Associates, Inc., also executive
recruiting consultants. He is also a Director of the Bull & Bear Funds Complex.
He owns __ shares of the Fund.
5
<PAGE>
FREDERICKA. PARKER, JR. -- Director ( - present). 219 East 69th Street, New
York, NY 10021. He is President and Chief Executive Officer of American Pure
Water Corporation, a manufacturer of water purifying equipment. He was born
November 14, 1926. He is also a Director of the Bull & Bear Funds Complex. He
owns __ shares of the Fund.
JOHN B. RUSSELL -- Director ( - present). 334 Carolina Meadows Villa, Chapel
Hill, NC 27514. He was Executive Vice President and a Director of Dan River,
Inc., a diversified textile company, from 1969 until he retired in 1981. He was
born February 9, 1923. He is a Director of Wheelock, Inc., a manufacturer of
signal products, and a consultant for the National Executive Service Corps in
the health care industry. He is also a Director of the Bull & Bear Funds
Complex. He owns __ shares of the Fund.
MARK C. WINMILL -- Director ( - present), Co-President ( - present),
Co-Chief Executive Officer ( - present), and Chief Financial Officer ( -
present). He is Co-President, Co-Chief Executive Officer, and Chief Financial
Officer of the Bull & Bear Funds Complex and of Group and certain of its
affiliates, Chairman of the Investment Manager and Investor Service Center, Inc.
(the "Distributor"), and President of Bull & Bear Securities, Inc. ("BBSI"). He
was born November 26, 1957. He received his M.B.A. from the Fuqua School of
Business at Duke University in 1987. From 1983 to 1985 he was Assistant Vice
President and Director of Marketing of E.P. Wilbur & Co., Inc., a real estate
development and syndication firm and Vice President of E.P.W. Securities, its
broker/dealer subsidiary. He is a son of Bassett S. Winmill and brother of
Thomas B. Winmill. He is also a Director of two of the other investment
companies in the Bull & Bear Funds Complex. He owns _____ shares of the Fund.
THOMAS B. WINMILL -- Director ( - present), Co-President ( - present),
Co-Chief Executive Officer ( - present), and General Counsel ( -
present). He is Co-President, Co-Chief Executive Officer, and General Counsel of
the Bull & Bear Funds Complex and of Group and certain of its affiliates,
President of the Investment Manager and the Distributor, and Chairman of BBSI.
He was born June 25, 1959. He was associated with the law firm of Harris,
Mericle & Orr from 1984 to 1987. He is a member of the New York State Bar. He is
a son of Bassett S. Winmill and brother of Mark C. Winmill. He is also a
Director of certain of the other Bull & Bear Funds. He owns _____ shares of the
Fund.
*Bassett S. Winmill, Mark C. Winmill, Thomas B. Winmill and Robert D. Anderson
are "interested persons" of the Fund as defined by the 1940 Act, because of
their positions with the Investment Manager.
6
<PAGE>
Compensation Table
<TABLE>
<CAPTION>
- - - -----------------------------------------------------------------------------------------------------------------------------------
Name of Person, Aggregate Pension or Retirement Estimated Annual Total Compensation
Position Compensation Benefits Accrued as Benefits Upon From Registrant and
From Registrant Part of Fund Retirement Fund Complex* Paid
Expenses to Directors
- - - -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Bassett S. Winmill
Chairman
- - - -----------------------------------------------------------------------------------------------------------------------------------
Robert D. Anderson
Vice Chairman
- - - -----------------------------------------------------------------------------------------------------------------------------------
Russell E. Burke III
Director
- - - -----------------------------------------------------------------------------------------------------------------------------------
Bruce B. Huber
Director
- - - -----------------------------------------------------------------------------------------------------------------------------------
James E. Hunt
Director
- - - -----------------------------------------------------------------------------------------------------------------------------------
Frederick A. Parker
Director
- - - -----------------------------------------------------------------------------------------------------------------------------------
John B. Russell
Director
- - - -----------------------------------------------------------------------------------------------------------------------------------
Mark C. Winmill
Director
- - - -----------------------------------------------------------------------------------------------------------------------------------
Thomas B. Winmill
Director
- - - -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* All Directors except Russell E. Burke, Mark C. Winmill and Thomas B.
Winmill serve on the boards of all five investment companies in the Fund
Complex. Russell E. Burke, Mark C. Winmill and Thomas B. Winmill serve on
the boards of two investment companies in the Fund Complex.
Information in the above table is based on fees paid during the year
ended [June 30, 1995.] Directors who are not "interested persons" of the
Corporation may elect to defer receipt of fees for serving as a Director of the
Corporation. During the year ended [June 30, 1995,] Messrs. Huber and Hunt
deferred such fees pursuant to this arrangement.
The Board of Directors of the Fund met four times during the Fund's
fiscal year ended June 30, 1995, and each nominee attended all of the meetings
of the Board. The Fund has no compensation or audit committee since the
functions of such committees are undertaken by the entire Board of Directors. No
officer, Director or employee of the Fund's Investment Manager receives any
compensation from the Fund for acting as a Director or officer of the Fund.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR PROPOSAL 2.
---
OFFICERS OF THE FUND
STEVEN A. LANDIS -- Senior Vice President (March 1995 - present). He is Senior
Vice President of the Bull & Bear Funds Complex, the Investment Manager and
certain of its affiliates. He was born March 1, 1955. From 1993 to 1995, he was
Associate Director -- Proprietary Trading at Barclays De Zoete Wedd Securities
Inc., from 1992 to 1993 he was Director, Bond Arbitrage at WG Trading Company,
and from 1989 to 1992 he was Vice President of Wilkinson Boyd Capital Markets.
7
<PAGE>
BRETT B. SNEED, CFA -- Senior Vice President (1988 - present). He is Senior Vice
President of the Bull & Bear Funds Complex, the Investment Manager and certain
of its affiliates. He was born June 11, 1941. He is a Chartered Financial
Analyst, a member of the Association for Investment Management and Research, and
a member of the New York Society of Security Analysts. From 1986 to 1988, he
managed private accounts, from 1981 to 1986, he was Vice President of Morgan
Stanley Asset Management, Inc. and prior thereto was a portfolio manager and
member of the Finance and Investment Committees of American International Group,
Inc., an insurance holding company.
WILLIAM K. DEAN, CPA -- Treasurer and Chief Accounting Officer (March 1995 -
present). He is Treasurer and Chief Accounting Officer of the Bull & Bear Funds
Complex, the Investment Manager and its affiliates. He was born September 5,
1955. From 1984 to 1995 he held various positions with The Dreyfus Corporation,
a mutual fund company. He is a member of the American Institute of Certified
Public Accountants and the New York State Society of Certified Public
Accountants.
WILLIAM J. MAYNARD -- Vice President and Secretary (March 1995 - present). He is
Vice President and Secretary of the Bull & Bear Funds Complex, the Investment
Manager and its affiliates. He was born September 13, 1964. From 1991 to 1994 he
was associated with the law firm of Skadden, Arps, Slate, Meagher & Flom. He is
a member of the New York State Bar.
PORTFOLIO TRANSACTIONS
Bull & Bear Securities, Inc. ("BBSI"), a wholly owned subsidiary of
Group and the Investment Manager's affiliate, provides discount brokerage
services to the public as an introducing broker clearing through an unaffiliated
firm on a fully disclosed basis. The Investment Manager is authorized by the
Board of Directors of the Fund to place Fund brokerage through BBSI at its
posted discount rates and indirectly through BBSI's clearing firm. During the
fiscal year ended June 30, 1995, the Fund paid brokerage commissions of
_________ to BBSI, which represented ___% of the total brokerage commissions
paid by the Fund.
SHAREHOLDER PROPOSALS
The Fund is currently not required to hold an annual meeting in any
year in which the election of Directors is not required to be acted upon by the
provisions of the 1940 Act. Any shareholder who wishes to submit proposals to be
considered at a meeting of shareholders should send such proposals to the Fund
at 11 Hanover Square, New York, New York 10005. Proposals must be received a
reasonable time prior to the date of a meeting of shareholders to be considered
for inclusion in the materials for that meeting. Timely submission of a proposal
does not necessarily mean that such proposal will be included.
8
<PAGE>
OTHER BUSINESS
Management knows of no business to be presented to the Meeting other
than the matters set forth in this proxy statement, but should any other matter
requiring a vote of shareholders arise, the proxies will vote thereon according
to their best judgment in the interest of the Fund. In addition to solicitations
through the mails, the Fund may, if necessary to obtain the requisite
representation of shareholders, solicit proxies by telephone, telegraph and
personal interview by employees or through securities dealers, and it is
contemplated that Shareholders Communication Corporation, 40 Exchange Place, New
York, New York, will be retained specially for this purpose, for a fee of
$__________, provided shareholder approval of the proposals is obtained and
subject to certain assumptions, plus out-of-pocket expenses and disbursements.
The cost of soliciting proxies, including the preparation and mailing of the
proxy and proxy statement and including reimbursement to dealers and others who
forward proxy material to their clients will be borne by the Fund.
By order of the Board of Directors,
-------------------------------
William J. Maynard
Secretary
July __, 1995
9
<PAGE>
EXHIBIT A
SUBADVISORY AGREEMENT
AGREEMENT made this 15th day of May, 1995, by and between BULL & BEAR
ADVISERS, INC., a Delaware corporation (the "Investment Manager") and LION
RESOURCE MANAGEMENT LIMITED, an English corporation (the "Subadviser").
WHEREAS the Investment Manager has entered into a management agreement
(the "Management Agreement") with BULL & BEAR GOLD INVESTORS LTD. (the "Fund")
pursuant to which the Investment Manager furnishes the Fund with investment
management and other services; and
WHEREAS the Management Agreement provides that the Investment Manager
may, at its own expense, contract for research and other services as it deems
necessary or desirable to fulfill such obligations; and
WHEREAS, the Subadviser is registered under the Investment Advisers
Act of 1940; and
WHEREAS, the Investment Manager desires to retain the Subadviser to
provide subadvisory and research services in connection with the Fund and the
Subadviser is willing to provide such services;
NOW THEREFORE, in consideration of the mutual promises and agreements
herein contained and other good and valuable consideration, the receipt of which
is hereby acknowledged, it is hereby agreed between the parties hereto as
follows:
1. The Investment Manager will manage the investment and reinvestment of the
assets of Fund including the regular furnishing of advice with respect to the
Fund's portfolio transactions subject at all times to the control and final
direction of the Board of Directors of the Fund, for the period and on the terms
set forth in its Management Agreement with the Fund. The Investment Manager
retains responsibility for selecting brokers, monitoring trade executions,
communicating instructions to the Fund's custodian and other Fund agents, and
all other functions pertaining to the management of the Fund.
2. The Subadviser will make itself available to advise and consult with the
Investment Manager regarding the selection, clearing, and safekeeping of the
Fund's portfolio investments and assist in pricing and generally monitoring such
investments. The Subadviser will provide the Investment Manager with advice as
to allocation of the Fund's portfolio assets among (1) various countries,
including the United States and (2) equities, bullion, and/or other types of
investments, and within each such allocation of country and/or type of
investment, recommendations of specific investments. The Subadviser agrees to
permit the use of its name and the names of its personnel and other information
about the Subadviser in the marketing and other literature in connection with
the Fund.
3. In consideration of the Subadviser's services, the Investment Manager, and
not the Fund, shall pay to the Subadviser a percentage of the Investment
Manager's Net Fees. "Net Fees" are hereby defined as the actual amounts received
by the Investment Manager as compensation pursuant to paragraph 7 of the
Management Agreement less reimbursements, if any, pursuant to the guaranty set
forth in paragraph 9 of the Management Agreement and waivers of such
compensation by the Investment Manager. The amount of the percentage and the
timing of the payment shall be determined by the schedule and accompanying
definitions set forth in Appendix A hereto.
4. The Subadviser will pay all expenses incurred by it in connection with this
Subadvisory Agreement.
5. The services of the Subadviser hereunder are not to be deemed exclusive, and
the Subadviser shall be free to render similar services to others in addition to
the Investment Manager and the Fund so long as its services hereunder are not
impaired thereby. The Subadviser shall not render, however, similar services to
any U.S. registered investment company either directly or indirectly as an
A-1
<PAGE>
adviser, subadviser, or otherwise, other than to the Fund and other investment
companies for which the Investment Manager or its affiliates provide investment
management services. The Subadviser may render similar services to certain
private specialist portfolios, as determined by the Investment Manager and the
Subadviser from time to time.
6. This Subadvisory Agreement shall become effective upon approval by the
directors and shareholders of the Fund as required by the Investment Company Act
of 1940 (the "1940 Act"). Thereafter, if not terminated, this Subadvisory
Agreement shall continue from year to year if approved annually by (a) the Board
of Directors of the Fund or by vote of a majority of the outstanding voting
securities of the Fund as defined in the 1940 Act and (b) by a vote of a
majority of the Directors of the Fund who are not parties to the Subadvisory
Agreement, or interested persons of any such party. This Subadvisory Agreement
may be terminated without penalty at any time either by vote of the Board of
Directors of the Fund or by vote of the holders of a majority of the outstanding
voting securities of the Fund on 60 days' written notice to the Investment
Manager and the Subadviser, or by the Investment Manager or the Subadviser on 60
days' written notice to the Fund. In the event of termination upon notice as
herein described, the Investment Manager and the Subadviser agree that, subject
to the provisions of the 1940 Act, no party hereto will be entitled to or seek
indemnification or compensation from the other party for expenses incurred in
connection with marketing efforts performed during the term of this Agreement.
This Subadvisory Agreement shall immediately terminate in the event of its
assignment or upon the termination of the Management Agreement.
7. The Subadviser shall not be liable to the Fund or any shareholder of the Fund
for any error of judgment or mistake of law or for any loss suffered by the Fund
in connection with the matters to which this Subadvisory Agreement relates, but
nothing herein contained shall be construed to protect the Subadviser against
any liability to the Fund by reason of willful misfeasance, bad faith, or gross
negligence in the performance of its duties or by reason of its reckless
disregard of obligations and duties under this Subadvisory Agreement.
8. Subject to and in accordance with the Articles of Incorporation and Bylaws of
the Fund, the Investment Manager, and the Subadviser, it is understood that
directors, officers, agents and shareholders of the Fund, the Investment
Manager, or Subadviser are or may be interested in the Fund, the Investment
Manager, or the Subadviser as directors, officers, shareholders or otherwise,
that the Investment Manager or the Subadviser is or may be interested in the
Fund or the Investment Manager or the Subadviser as a shareholder or otherwise
and that the effect and nature of any such interests shall be governed by law
and by the provisions, if any, of said Articles of Incorporation or Bylaws.
9. All notices hereunder shall be in writing and shall be delivered in person or
sent by facsimile transmission that is confirmed by regular, registered, or
certified mail to the following address for the respective parties:
BULL & BEAR ADVISERS, INC.
11 Hanover Square
New York, NY 10005
Fax: (212) 785-0400
LION RESOURCE MANAGEMENT LIMITED
7 - 8 Kendrick Mews
London, U.K. SW7 3HG
Fax 01-144-71-591-0535
Notice shall be deemed given, five days after depositing in a post office,
postage prepaid and if sent by facsimile transmission five days after
confirmation has been mailed.
A-2
<PAGE>
10. As used in this Subadvisory Agreement, the terms "interested person,"
"assignment," and "vote of a majority of the outstanding voting securities"
shall have the meaning provided therefor in the 1940 Act, as from time to time
amended.
IN WITNESS WHEREOF, the parties hereto have executed this Subadvisory
Agreement on the day and year first above written.
BULL & BEAR ADVISERS, INC.
By:________________________________________
LION RESOURCE MANAGEMENT LIMITED
By:________________________________________
A-3
<PAGE>
APPENDIX A
BULL & BEAR GOLD INVESTORS LTD.
Subadvisory Fee
As a percent of Net Fees
The Investment Manager shall pay to the Subadviser within 30 days of
each Performance Determination Date, as defined in paragraph A below, a
percentage of the Net Fees, as defined in paragraph 3 of this Subadvisory
Agreement, earned since the later of the effective date of this Subadvisory
Agreement or the prior Performance Determination Date, as defined in paragraph A
below. The amount of the percentage shall be determined by reference to the grid
set forth below.
<TABLE>
<CAPTION>
-----------------------------------------------------------------------
RELATIVE PERFORMANCE(A)
- - - -------------------------------------------------------------------------------------------------------------------
TOTAL NET ASSETS(B) More than 50 basis points Within 50 basis More than 50 basis
better than BTR points of BTR points below BTR
- - - -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
<= $50,000,000 30% 17.5% 5%
- - - -------------------------------------------------------------------------------------------------------------------
> $50,000,000 and 40% 30% 20%
<= $150,000,000
- - - -------------------------------------------------------------------------------------------------------------------
> $150,000,000 and 45% 35% 25%
<= $250,000,000
- - - -------------------------------------------------------------------------------------------------------------------
> $250,000,000 50% 40% 30%
- - - -------------------------------------------------------------------------------------------------------------------
</TABLE>
A. "Relative Performance" is determined from comparing the total return
performance of the Fund and the total return performance of the "Benchmark
Performance" of the objective category of "precious metals" funds ("BTR") as
determined by Morningstar, Inc., or, if unavailable, other similar service
acceptable to the parties and the Fund. The Relative Performance is determined
as of the last calendar day of each month ("Performance Determination Date") and
measures the Relative Performance for the most recent 12 month period
("Measurement Period"), except that for the first 12 months of the Subadvisory
Agreement, Relative Performance is based upon annualized returns, the first
three Performance Determination Dates are the next three calendar quarter ends
after the effective date of the Subadvisory Agreement, and the Measurement
Periods are the most recent three months and the fourth Performance
Determination Date is the next calendar quarter end and the Measurement Period
is the most recent twelve months.
B. "Total Net Assets" is the total net assets of the Fund as of the Performance
Determination Date.
A-4
<PAGE>
PROXY
BULL & BEAR GOLD INVESTORS LTD.
The undersigned hereby appoints Robert D. Anderson and Thomas B.
Winmill and each of them, with full power of substitution, to vote as designated
below all shares of common stock of Bull & Bear Gold Investors Ltd. (the "Fund")
which the undersigned is entitled to vote at the Special Meeting of Shareholders
to be held on ____________________ and any adjournment thereof, revoking all
proxies heretofore given, upon the proposals described in the proxy statement.
1. Approval or Disapproval of a Subadvisory Agreement (Proposal 1);
2. Election of Directors (Proposal 2); and
3. To transact such other business as may properly come before the meeting.
<PAGE>
THIS PROXY, IF PROPERLY EXECUTED WILL BE VOTED AS DIRECTED BY THE UNDERSIGNED.
IF NO DIRECTION IS MADE, IT WILL BE VOTED FOR PROPOSALS 1 AND 2. THIS PROXY IS
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
__________________________(L.S.)
Signature
__________________________(L.S.)
Signature
Dated _________________, 1995
PLEASE SIGN EXACTLY AS YOUR NAME APPEARS
HEREON. IF SHARES ARE REGISTERED IN MORE THAN
ONE NAME, ALL SHOULD SIGN BUT IF ONE SIGNS,
IT BINDS THE OTHERS. WHEN SIGNING AS
ATTORNEY, EXECUTOR, ADMINISTRATOR, AGENT,
TRUSTEE OR GUARDIAN, PLEASE GIVE FULL TITLE
AS SUCH. IF A CORPORATION, PLEASE SIGN IN
FULL CORPORATE NAME BY AN AUTHORIZED OFFICER.
IF A PARTNERSHIP, PLEASE SIGN IN PARTNERSHIP
NAME BY AN AUTHORIZED PERSON.
TO AVOID EXPENSES OF ADJOURNING THE MEETING, PLEASE RETURN THIS PROXY
PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
