<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
FILED BY THE REGISTRANT [X]
FILED BY A PARTY OTHER THAN THE REGISTRANT []
CHECK THE APPROPRIATE BOX:
[ ] Preliminary Proxy Statement
[ ] Confidential, for use of the Commission only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
M.S.B. FUND, INC.
------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price of other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE> 2
===========================
M.S.B.
FUND, INC.
===========================
200 PARK AVENUE, 15TH FLOOR WEST
NEW YORK, NY 10166
NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS TO BE HELD
APRIL 17, 1997
---------------------------
To the Stockholders of M.S.B. FUND, INC.:
The Annual Meeting of Stockholders of M.S.B. FUND, INC. (the "Fund") will
be held at The Sky Club, 56th Floor, 200 Park Avenue, New York, New York on
Thursday, April 17, 1997 at 1:00 P.M. for the following purposes:
- To elect a total of five directors (Proposal 1);
- To consider and vote upon a proposal to ratify the selection of the
firm of KPMG Peat Marwick LLP as independent auditors of the Fund for
the fiscal year ending December 31, 1997 (Proposal 2); and
- To transact such other business as may properly come before the
meeting or any adjournment thereof.
Stockholders of record at the close of business on February 28, 1997 will
be entitled to vote at the meeting or any adjournment thereof.
STOCKHOLDERS ARE REQUESTED TO COMPLETE, DATE AND SIGN THE ENCLOSED FORM OF
PROXY AND RETURN IT PROMPTLY IN THE ENVELOPE PROVIDED FOR THIS PURPOSE. If you
attend the meeting and wish to vote in person, your proxy will not be used.
By Order of the Board of
Directors
Edward E. Sammons, Jr.
Edward E. Sammons, Jr.
Secretary
March 11, 1997
<PAGE> 3
M.S.B. FUND, INC.
200 PARK AVENUE, 15TH FLOOR WEST
NEW YORK, NEW YORK 10166
------------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD APRIL 17, 1997
------------------
This Proxy Statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of M.S.B. Fund, Inc. (the "Fund"),
to be voted at the Annual Meeting of Stockholders of the Fund to be held at The
Sky Club, 56th Floor, 200 Park Avenue, New York, New York on Thursday, April 17,
1997, at 1:00 P.M. and at any adjournment thereof, for the purposes set forth in
the accompanying Notice of Annual Meeting of Stockholders. This Proxy Statement
and the accompanying proxy card are being mailed to stockholders for the first
time on or about March 11, 1997.
If the enclosed proxy card is executed and returned, it may nevertheless be
revoked at any time insofar as it has not been exercised. Revocation may be made
in writing to the Secretary of the Fund (by execution of a proxy bearing a later
date or otherwise) or orally by a stockholder present at the meeting. Unless so
revoked, the shares represented by a properly executed proxy will be voted at
the meeting and at any adjournment thereof in accordance with the instructions
indicated on that proxy. If no such instructions are specified, the proxy will
be voted for the election of the directors nominated herein (see Proposal 1) and
for Proposal 2 described in this Proxy Statement.
Stockholders of record at the close of business on February 28, 1997 will
be entitled to vote at the meeting and any adjournment thereof. The Fund had
outstanding 2,603,242 voting shares on such date. Each full share held by a
stockholder is entitled to one vote. Fractional share credits held by a
stockholder do not have voting rights. As to each matter presented to a vote of
stockholders, including the election of directors, shares present at the meeting
in person or by represented proxy which abstain on a matter or are not voted
because the proxyholder has not received necessary authorization will be counted
in determining the presence of a quorum but will not be counted as for or
against the matter and will not be counted in the number of votes cast for
purposes of determining whether the approval of any required percentage of
shares voting at the Annual Meeting has been obtained.
A plurality of the votes cast at the Annual Meeting is required to elect a
director. Approval of Proposal 2 will require the affirmative vote of a majority
of the votes cast at the Annual Meeting.
Although the Annual Meeting is called to transact any other business that
may properly come before it, the management of the Fund does not intend to
present, and at the date hereof has no information that others will present, any
matters other than Proposals 1 and 2. However, stockholders are being asked on
the enclosed proxy card to authorize the persons named therein to vote with
respect to any additional matters that properly come before the Annual Meeting,
including all matters incidental to the conduct of the Annual Meeting. If any
such matters do properly come before the Annual Meeting, it is the intention of
the persons named in the proxies to vote said proxies in accordance with their
best judgment.
1
<PAGE> 4
A majority of the shares of the Fund outstanding on the record date,
present in person or represented by proxy, constitutes a quorum for the
transaction of business at the Annual Meeting. In the event that a quorum is not
present, or if sufficient votes in favor of any proposal are not received by the
time of the Annual Meeting, the persons named as proxies may propose one or more
adjournments of the Annual Meeting to permit further solicitation of proxies.
Any such adjournment of the Annual Meeting will require the affirmative vote of
a majority of the shares present in person or represented by proxy at the
session of the Annual Meeting to be adjourned and will not require any further
notice to stockholders other than announcement at the meeting of the time and
place to which the meeting is adjourned. The persons named as proxies will vote
in favor of such adjournment those proxies which they are entitled to vote in
favor of all proposals. They will vote against any such adjournment those
proxies required to be voted against or to abstain from voting on any proposal.
The Fund will bear the cost of this solicitation. In order to obtain a
quorum at the Annual Meeting, supplementary solicitation may be made by mail,
telephone, telegraph or personal interview by officers of the Fund. It is
anticipated that the cost of such supplemental solicitation, if any, will be
nominal.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, THE BOARD OF DIRECTORS
REQUESTS THAT YOU COMPLETE, DATE AND SIGN YOUR PROXY CARD AND RETURN IT PROMPTLY
IN THE ENVELOPE PROVIDED FOR THIS PURPOSE TO ENSURE THAT YOUR SHARES WILL BE
REPRESENTED AT THE MEETING. If you attend the meeting and wish to vote in
person, your proxy will not be used.
2
<PAGE> 5
MATTERS TO COME BEFORE THE ANNUAL MEETING
PROPOSAL 1 -- ELECTION OF DIRECTORS
The by-laws of the Fund provide that the Board of Directors shall consist
of the number of directors established from time to time by vote of a majority
of the entire Board of Directors which number has been set at eleven, all of
whom must be stockholders, and shall be divided into three classes, which shall
be as nearly equal in number as possible and no one of which shall include less
than three directors. Directors of each class serve for terms of three years
with the terms of the respective classes expiring at successive annual meetings
of the Fund. As a result of this arrangement, only the directors in a single
class may be changed in any one year, and it would require two years to change a
majority of the Board of Directors.
At the Annual Meeting, four directors will be elected to serve for complete
terms of three years each expiring in 2000 and one director will be elected to
fill the unexpired term of Gilbert O. Robert expiring in 1999. Six directors
will continue to serve in accordance with the terms for which they were
previously elected. All directors elected shall serve until their successors
shall have been elected and qualified.
Proxies will be voted for the election of each of the nominees unless
instructions are given on the proxy card to withhold authority to vote for one
or more of the nominees. All of the nominees have agreed to serve as directors
of the Fund.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR"
EACH OF THE NOMINEES FOR ELECTION AS DIRECTOR LISTED BELOW.
The name, age, principal occupations for the past five years and other
business experience of each director and nominee for election as a director are
set forth below.
NOMINEE FOR ELECTION AS DIRECTOR FOR TERM EXPIRING 1999
TIMOTHY A. DEMPSEY, age 63
President and Chief Executive Officer
The Warwick Savings Bank
Mr. Dempsey has been President and Chief Executive Officer of The Warwick
Savings Bank since 1985. Mr. Dempsey also serves as a director and as Executive
Vice President of Institutional Investors Capital Appreciation Fund, Inc. and
Institutional Investors Tax-Advantaged Income Fund, Inc., each of which is an
investment company registered under the Investment Company Act of 1940 for which
Shay Assets Management Co. acts as investment adviser.
NOMINEES FOR ELECTION AS DIRECTORS FOR TERMS EXPIRING 2000
+DAVID F. HOLLAND, age 55
Chairman, President and Chief Executive Officer
Boston Federal Savings Bank
Mr. Holland has been President and Chief Executive Officer of Boston Federal
Savings Bank since 1986 and Chairman of the Board of Boston Federal Savings Bank
since 1989 and has been Chairman and Chief Executive Officer of its holding
company, BostonFed Bancorp Inc. since its inception in 1995. Mr. Holland also
serves as a director of Asset Management Fund, Inc., which is an investment
company registered under the Investment Company Act of 1940 for which Shay
Assets Management Co. acts as investment adviser, Chairman of America's
Community Banking Partners, Inc., director of ACB Investment Services, Inc.,
which owns through a subsidiary a 50% interest in the Fund's investment adviser
and distributor, a director of NYCE Corporation and President of the Thrift
Industry Advisory Council.
- ---------------
+ This nominee would be an "interested person" of the Fund as defined in the
Investment Company Act of 1940 because he is an affiliated person of the
Fund's investment advisor.
3
<PAGE> 6
GEORGE J. KELLY, age 74
Formerly Consultant Savings Banks
Association of New York State
Mr. Kelly first became a director in 1982. From July 1988 to June 1991, Mr.
Kelly served as a consultant to the Savings Banks Association of New York State.
Prior to June 1988, Mr. Kelly served as a Senior Vice President and Secretary of
the Savings Banks Association of New York State. Mr. Kelly is retired. Mr. Kelly
served as Treasurer of the Fund from 1987 to 1995.
NORMAN W. SINCLAIR, age 72
Formerly Chairman of
Lockport Savings Bank
Mr. Sinclair first became a director in 1988. Mr. Sinclair served as Chairman of
Lockport Savings Bank from December 1988 to June 1994. Prior to June 1989, Mr.
Sinclair had also served as Chief Executive Officer of Lockport Savings Bank.
Mr. Sinclair is retired. Mr. Sinclair also serves as Treasurer and Secretary of
Townline Bowl Inc., which owns and operates bowling lanes.
*IAN D. SMITH, age 72
Formerly Senior Vice President and Managing
Director of Apple Bank for Savings
Mr. Smith first became a director in 1982. Mr. Smith has served as Second Vice
President of the Fund since 1994. He previously served as President of the Fund
from March 1985 to March 1987. Mr. Smith is retired. He served as Senior Vice
President and Managing Director of Apple Bank for Savings from July 1989 through
August 1991. From 1983 to 1987, Mr. Smith served as Executive Vice President of
Seamen's Bank for Savings, F.S.B.
It is not contemplated that any nominee will be unable to serve, except as
discussed below with respect to Mr. Kelly. If prior to the Annual Meeting a
nominee should become unable to serve, the shares will be voted by the
proxyholders for such other person that the Board of Directors recommends. The
Fund's by-laws provide that a director may not continue in office after the
first annual stockholders' meeting following the director's seventy-fifth
birthday, except that this restriction may be waived by the Board of Directors
to permit a director to serve the remainder of his term. Pursuant to this
provision of the by-laws, Mr. Kelly, who has been nominated for a three-year
term expiring in 2000 could not continue as a director of the Fund after the
Fund's 1998 Annual Meeting of Stockholders absent a waiver by the Board of
Directors. In such event, the resulting vacancy on the Board could be filled by
the Board of Directors.
CONTINUING DIRECTORS
MALCOLM J. DELANEY, age 70 Term Expires 1998.
Formerly President and Chief Executive Officer
Eastchester Savings Bank
Mr. Delaney first became a director in 1988. In 1992 Mr. Delaney retired from
Eastchester Savings, a division of Southold Savings Bank. From 1986 through
1992, Mr. Delaney served as President and Chief Executive Officer of Eastchester
Savings Bank which was acquired by Southold Savings Bank, and he had served as a
trustee of the bank since 1981. Mr. Delaney served as a director of North Fork
Bancorporation, Inc. until August 1, 1996.
- ---------------
* This director is an "interested person" of the Fund as defined in the
Investment Company Act of 1940 because he is an officer of the Fund.
4
<PAGE> 7
+HARRY P. DOHERTY, age 54 Term Expires 1999.
Chairman and Chief Executive Officer
Staten Island Savings Bank
Mr. Doherty first became a director in 1996. Mr. Doherty has been Chairman and
Chief Executive Officer of Staten Island Savings Bank since 1990. Mr. Doherty
also serves as a director and as President of Institutional Investors Capital
Appreciation Fund, Inc. and Institutional Investors Tax-Advantaged Income Fund,
Inc., each of which is an investment company registered under the Investment
Company Act of 1940 for which Shay Assets Management Co. acts as investment
adviser. Mr. Doherty also serves as a director of America's Community Bankers
which owns through subsidiaries a 50% interest in the Fund's investment advisor
and distributor, and as Chairman of Community Bankers Association of New York
State.
*JOSEPH R. FICALORA, age 50 Term Expires 1999.
Chairman, President and Chief Executive Officer
Queens County Bancorp, Inc.
Mr. Ficalora first became a director in 1996. Mr. Ficalora has been Chairman,
President and Chief Executive Officer of Queens County Bancorp, Inc. since its
inception in July 1993, and has been President of Queens County Savings Bank,
its principal subsidiary, since 1989. Mr. Ficalora also serves as Chairman of
the Board of the New York Savings Bank Life Insurance Fund, President of the
Queens Library Foundation Board, Executive Vice President of Finance and Board
member of Queensborough Boy Scouts and Vice President and a member of the Board
of the Queens Chamber of Commerce. He also serves on the Board of the following
organizations: Queensborough Community College, Queens Museum, Flushing Cemetery
and the Community Bankers Association of New York State.
*DAVID FREER, JR., age 57 Term Expires 1998.
President and Treasurer
Budget Payment Corporation
Mr. Freer first became a director in 1983 and has served as President of the
Fund since November of 1990. Mr. Freer had previously served as Vice President
of the Fund from 1985 through 1990. Since January 1, 1990, Mr. Freer has served
as President, Treasurer and as a director of Budget Payment Corporation, which
engages in the business of financing insurance premiums.
MICHAEL J. GAGLIARDI, age 56 Term Expires 1999.
President and Chief Executive Officer
Ironbound Bank
Mr. Gagliardi first became a director in 1991. Mr. Gagliardi is President, Chief
Executive Officer and a director of Ironbound Bank located in Newark, NJ. From
January 1992 through February 1993 he served as Chairman, President and Chief
Executive Officer of Green Point Savings Bank. From 1989 through 1992, Mr.
Gagliardi served as President and Chief Executive Officer, and from 1987 through
1989 he served as Executive Vice President and Chief Financial Officer of Green
Point Savings Bank. He also serves as a director of the National Association for
the Study of Wilsons Disease.
WILLIAM A. MCKENNA, JR., age 60 Term Expires 1998.
Chairman, President and Chief Executive Officer
Ridgewood Savings Bank
Mr. McKenna first became a director in 1988. Since January 1992, Mr. McKenna has
served as Chairman, President and Chief Executive Officer of Ridgewood Savings
Bank. From January
- ---------------
+ This director is an "interested person" of the Fund as defined in the
Investment Company Act of 1940 because he is an affiliated person of the
Fund's investment advisor.
* This director is an "interested person" of the Fund as defined in the
Investment Company Act of 1940 because he is an officer of the Fund.
5
<PAGE> 8
1985 to January 1992, Mr. McKenna served as President and Chief Operating
Officer of Ridgewood Savings Bank. Mr. McKenna also serves as a director of
Institutional Investors Capital Appreciation Fund, Inc. and Institutional
Investors Tax-Advantaged Income Fund, Inc., each of which is an investment
company registered under the Investment Company Act of 1940 for which Shay
Assets Management Co. acts as investment adviser. From September 1993 through
February 1995, Mr. McKenna also served as a director of Nationar, which
previously acted as the Fund's investment adviser. In addition, Mr. McKenna
serves on the board of a number of educational and civic organizations,
including St. Joseph's College in Brooklyn, New York, St. Vincent's Services and
Wyckoff Heights Medical Center. He also serves as a director of Tablet
Publishing Co.
BOARD COMMITTEES
The Fund has an Executive Committee, composed of Messrs. David Freer, Jr.*
(Chairman), Joseph R. Ficalora*, William A. McKenna, Jr. and Ian D. Smith*.
Subject to limitations provided by law or the Fund's by-laws, the Executive
Committee is authorized to exercise the power and authority of the Board of
Directors as may be necessary during the intervals between meetings of the Board
of Directors. The Executive Committee did not meet during 1996.
The Fund has a Nominating Committee, composed of Messrs. Ian D. Smith*
(Chairman), George J. Kelly and William A. McKenna, Jr., whose function is to
recommend nominees for election as directors and officers of the Fund. The
Committee holds informal discussions as necessary concerning its activities and
met three times during 1996. The Nominating Committee will consider nominees
proposed by stockholders. Stockholders who desire to propose a nominee should
write to the Secretary of the Fund and furnish adequate biographical data
including information concerning the qualifications of the proposed nominee
prior to the date specified in this Proxy Statement under the caption
"Stockholder Proposals for the 1998 Annual Meeting".
The Fund has an Audit Committee composed of Messrs. Michael J. Gagliardi
(Chairman), Harry P. Doherty and Norman W. Sinclair. The Audit Committee makes
recommendations to the full Board of Directors with respect to engagement of
independent auditors and reviews with the Fund's independent auditors the scope
and results of the annual audit and matters having a material effect upon the
Fund's financial statements. The Audit Committee met once during 1996. The Fund
does not have a compensation committee.
During 1996, the Board of Directors met 9 times; each of the directors
attended more than 75% of the aggregate number of meetings of the Board and
meetings of the Board committees on which they served, except for Mr. Delaney,
who attended 6 of 9 meetings.
EXECUTIVE OFFICERS OF THE FUND
The executive officers of the Fund are appointed to serve for terms of one
year and until their respective successors are chosen and qualified. The
executive officers of the Fund are:
<TABLE>
<CAPTION>
OFFICER
NAME OFFICE AGE SINCE
---- ------ --- -------
<S> <C> <C> <C>
David Freer, Jr.................. President 57 1984
Joseph R. Ficalora............... First Vice President 50 1996
Ian D. Smith..................... Second Vice President 72 1994
Rodger D. Shay................... Vice President and Assistant Secretary 60 1995
Edward E. Sammons, Jr............ Vice President and Secretary 57 1995
John J. McCabe................... Vice President 53 1995
Mark F. Trautman................. Vice President 31 1995
Jay F. Nusblatt.................. Treasurer 35 1995
</TABLE>
- ---------------
* This director is an "interested person" of the Fund as defined in the
Investment Company Act of 1940 because he is an officer of the Fund.
6
<PAGE> 9
The principal occupations during the last five years and other business
experience for each executive officer of the Fund (other than persons who also
serve as directors) are set forth below.
RODGER D. SHAY
President and Chief Executive Officer
Shay Assets Management Co.
Mr. Shay has been President, Chief Executive Officer and member of the Managing
Board of Shay Assets Management Co. since 1990 and President and Director of
Shay Assets Management, Inc., the managing partner of Shay Assets Management
Co., the Fund's investment adviser, since 1990. Mr. Shay also has served as
President, Chief Executive Officer and member of the Managing Board of Shay
Financial Services Co., the Fund's distributor, since 1990 and President and
Director of Shay Financial Services, Inc., the managing partner of Shay
Financial Services Co., since 1990. He serves or has previously served in the
following capacities: President and a Director, Asset Management Fund, Inc., a
registered investment company; Vice President and Assistant Secretary of
Institutional Investors Capital Appreciation Fund, Inc. and Institutional
Investors Tax-Advantaged Income Fund, Inc., each a registered investment
company; Director from 1986 to 1991 and President from 1986 to 1992, U.S. League
Securities, Inc.; Director from 1985 to 1991, and Executive Vice President from
1989 to 1992, USL Assets Management, Inc. (previously Vice Chairman from 1986 to
1989 and President, including of a predecessor, from 1981 to 1986); Director,
First Home Savings Bank, S.L.A. since 1990; President of Bolton Shay and Company
and Director and officer of its affiliates from 1981 to 1985. He previously was
employed by certain subsidiaries of Merrill Lynch & Co. from 1955 to 1981, where
he served in various executive positions including Chairman of the Board of
Merrill Lynch Government Securities, Inc., Chairman of the Board of Merrill
Lynch Money Market Securities, Inc. and Managing Director of the Debt Trading
Division of Merrill Lynch, Pierce, Fenner & Smith Inc.
EDWARD E. SAMMONS, JR.
Executive Vice President
Shay Assets Management Co.
Mr. Sammons has been Executive Vice President and member of the Managing Board
of Shay Assets Management Co. since 1990 and Executive Vice President of Shay
Assets Management, Inc., the managing partner of Shay Assets Management Co.
since 1990. Mr. Sammons also has served as Executive Vice President and member
of the Managing Board of Shay Financial Services Co., the Fund's distributor,
since 1990 and Executive Vice President of Shay Financial Services, Inc. since
1990. He serves or has previously served in the following capacities: Vice
President, Treasurer and Secretary of Asset Management Fund, Inc., a registered
investment company; Vice President and Secretary of Institutional Investors
Capital Appreciation Fund, Inc. and Institutional Investors Tax-Advantaged
Income Fund, Inc.; President, USL Assets Management, Inc. from 1986 to 1992
(previously Senior Vice President, including of a predecessor, from 1983 to
1986) and a Director from 1989 to 1991; Executive Vice President from 1990 to
1992 and a Director from 1990 to 1991 of U.S. League Securities, Inc.; Vice
President, from 1987 to 1990, Advance America Funds, Inc.; and Senior Vice
President and Manager of Fixed Income Securities, Republic National Bank in
Dallas from 1962 to 1983.
JOHN J. MCCABE
Senior Vice President
Shay Assets Management Co.
Mr. McCabe has been a Senior Vice President of Shay Assets Management Co. since
June 1995. From August 1991 through May 1995, he was Senior Vice President and
Chief Investment Officer of Nationar. He also serves as a Vice President of
Institutional Investors Capital Appreciation Fund, Inc. and Institutional
Investors Tax-Advantaged Income Fund, Inc. He previously served as Managing
Director and Portfolio Manager at Sterling Manhattan Corporation, an investment
banking firm, for approximately three years and in various positions at Bankers
Trust Company, including Director of Investment Research and Managing Director
of the Investment Management Group. Mr. McCabe is a director and past President
of the New York Society of Security Analysts, a past director of the Financial
Analysts Federation and a member and founding Governor of The Association for
Investment Management and Research.
7
<PAGE> 10
MARK F. TRAUTMAN
Vice President
Shay Assets Management Co.
Mr. Trautman has been a Vice President of Shay Assets Management Co. since June
1995 and has been Portfolio Manager of the Fund since March 1993. From March
1993 through May 1995, he served as Director of Mutual Funds Investment of
Nationar. He also serves as a Vice President and Portfolio Manager for
Institutional Investors Capital Appreciation Fund, Inc. and Institutional
Investors Tax-Advantaged Income Fund, Inc. From January 1992 through March 1993
he served as Senior Equity Analyst for the three funds. From December 1988
through December 1991, Mr. Trautman was a Senior Associate with Sterling
Manhattan Corporation. From June 1987 through November 1988, Mr. Trautman held
the position of Treasury Analyst at Thomson McKinnon Securities, Inc., a
securities brokerage firm.
JAY F. NUSBLATT
Vice President and Director of Fund Accounting and Administration
PFPC Inc.
Mr. Nusblatt has been Vice President and Director of Fund Accounting and
Administration of PFPC Inc., the Fund's administrator, since March 1993. Mr.
Nusblatt also serves as Treasurer of Institutional Investors Capital
Appreciation Fund, Inc. and Institutional Investors Tax-Advantaged Income Fund,
Inc. He was previously employed as an Assistant Vice President of Fund/Plan
Services, Inc., with responsibility for financial reporting and fund
administration from 1989 to 1993.
8
<PAGE> 11
COMPENSATION OF OFFICERS AND DIRECTORS
The Fund compensated directors for their services as directors in 1996 at
the rate of $300 for each monthly Board meeting attended and $600 for each
quarterly Board meeting. The Board of Directors met monthly through July 1996
and currently meets quarterly. Effective January 1, 1997, directors will receive
an annual retainer of $3,000, payable at the end of each quarter, and an
additional $500 for each Board meeting attended. An additional fee of $250 is
payable for each meeting of committees of the Board of Directors held on a day
other than the day of a meeting of the Board of Directors. No additional fee is
paid for telephonic meetings. In 1996 the total director compensation was
$28,500. The Fund does not provide officers with any compensation other than the
compensation they may receive for service as a director except that the
President will receive, effective January 1, 1997, an additional annual retainer
of $2,000 in recognition of the additional responsibilities of the President.
The Fund does not provide officers and directors directly or indirectly with any
pension or retirement benefits for their services to the Fund. The Fund,
however, does reimburse directors and officers for their reasonable expenses
incurred in attending meetings or otherwise in connection with their attention
to the affairs of the Fund. In 1996, the total of such reimbursed expenses was
$10,364.
The following table sets forth the aggregate compensation received by each
director of the Fund from the Fund and any other investment company having the
same investment adviser for services as a director or officer during 1996. Such
compensation does not include reimbursements to the directors for their expenses
incurred in connection with their activities as directors.
COMPENSATION TABLE
<TABLE>
<CAPTION>
TOTAL
AGGREGATE COMPENSATION
COMPENSATION FROM THE FUND
NAME OF DIRECTOR FROM THE FUND AND FUND COMPLEX
- ---------------- ------------- ----------------
<S> <C> <C>
Malcolm J. Delaney................. $2,700 $ 2,700
Harry P. Doherty................... $2,100 $13,650*
Joseph R. Ficalora................. $3,000 $ 3,000
David Freer, Jr.................... $3,300 $ 3,300
Michael J. Gagliardi............... $3,300 $ 3,300
George J. Kelly.................... $3,300 $ 3,300
William A. McKenna, Jr............. $3,000 $11,150*
Gilbert O. Robert.................. $1,500 $ 1,500
Norman W. Sinclair................. $3,000 $ 3,000
Ian D. Smith....................... $3,300 $ 3,300
</TABLE>
- ---------------
* Includes compensation of $8,150 received by Mr. McKenna as a director and
$11,550 received by Mr. Doherty as a director and officer of two other
investment companies with the same investment adviser as the Fund.
9
<PAGE> 12
SECURITY OWNERSHIP OF MANAGEMENT
The following table provides information with respect to shares of the Fund
beneficially owned by each director and each nominee for election as a director
and by all directors, nominees and executive officers as a group as of December
31, 1996. No nominee or continuing director or officer beneficially owns more
than 1% of the Fund's outstanding shares. On December 31, 1996, all directors,
nominees and officers of the Fund as a group beneficially owned 88,252 shares
(approximately 3.4% of the shares outstanding on such date) of the Fund. No
person or group is known to the Fund to be the beneficial owner of more than 5%
of the Fund's outstanding shares. The table below sets forth the shares owned by
the directors of the Fund and the Fund's directors and officers of the Fund as a
group as of December 31, 1996, except for Mr. Holland for whom the information
is as of March 7, 1997.
<TABLE>
<CAPTION>
NUMBER OF SHARES OF
COMMON STOCK PERCENT
NAME BENEFICIALLY OWNED(1) OF CLASS
- ---- --------------------- --------
<S> <C> <C>
DIRECTORS AND NOMINEES
Malcolm J. Delaney................... 2,503(2) *
Timothy A. Dempsey................... 297 *
Harry P. Doherty..................... 2,021(2) *
Joseph R. Ficalora................... 598 *
David Freer, Jr...................... 18,609(2)(3) *
Michael J. Gagliardi................. 8,223(2)(4) *
David F. Holland..................... 32(5) *
George J. Kelly...................... 1,156 *
William A. McKenna, Jr............... 25,425(2)(6) *
Norman W. Sinclair................... 2,950 *
Ian D. Smith......................... 5,606 *
EXECUTIVE OFFICERS WHO ARE
NOT ALSO DIRECTORS
Rodger D. Shay....................... 3,244 *
Edward E. Sammons, Jr................ 1,168 *
John J. McCabe....................... 8,636 *
Mark F. Trautman..................... 7,783(2)(7) *
Jay F. Nusblatt...................... 0 *
ALL DIRECTORS, EXECUTIVE OFFICERS AND
NOMINEES AS A GROUP (16 persons)... 88,252 3.4%
</TABLE>
- ---------------
* Less than 1%.
(1) Except as otherwise indicated, the beneficial owner has sole voting and
investment power.
(2) Includes shares owned by, or jointly held with, spouses as follows: Mr.
Delaney -- 2,503 shares jointly owned with Mrs. Delaney; Mr. Doherty --
1,755 shares jointly owned with Mrs. Doherty; Mr. Freer -- 5,388 shares
jointly owned with Mrs. Freer and 1,843 owned by Mrs. Freer; Mr. Gagliardi
-- 842 shares jointly owned with Mrs. Gagliardi; Mr. McKenna -- 19,599
shares jointly owned with Mrs. McKenna; Mr. Shay -- 3,244 shares jointly
owned with Mrs. Shay; and Mr. Trautman -- 2,361 shares jointly owned with
Mrs. Trautman and 1,532 shares owned by Mrs. Trautman.
(3) Includes 833 shares owned by Double V Enterprises, Inc. which is 100% owned
by Mr. Freer.
(4) Includes 475 shares owned and voted by Mr. Gagliardi's son (as to which Mr.
Gagliardi disclaims beneficial ownership).
(5) Reflects 32 shares acquired by Mr. Holland on March 7, 1997.
(6) Includes 5,498 shares held by Mr. McKenna as custodian for his children and
for which Mr. McKenna has sole voting and investment power and 328 shares
owned and voted by Mr. McKenna's children.
(7) Includes 153 shares held by Mr. Trautman as custodian under the Uniform
Gifts to Minors Act.
10
<PAGE> 13
PROPOSAL 2 -- RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
Subject to approval by the stockholders, the Board of Directors has
selected the firm of KPMG Peat Marwick LLP, 1600 Market Street, Philadelphia,
Pennsylvania, as the Fund's independent auditors for the fiscal year ending
December 31, 1997. KPMG Peat Marwick has served as the auditors of the Fund
since 1989.
A representative of KPMG Peat Marwick LLP is expected to be present at the
Annual Meeting with the opportunity to make a statement if such representative
desires to do so and will be available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL 2.
ADDITIONAL INFORMATION
ADDRESS OF INVESTMENT ADVISER, DISTRIBUTOR AND ADMINISTRATOR
The principal offices of the Fund's investment adviser, Shay Assets
Management Co., and of its distributor, Shay Financial Services Co., are located
at 111 East Wacker Drive, Chicago, Illinois 60601. Shay Assets Management Co.
also maintains an office located at 200 Park Avenue, 15th Floor West, New York,
New York. The principal office of the Fund's administrator, PFPC Inc., is
located at 103 Bellevue Parkway, Wilmington, Delaware 19809.
ANNUAL REPORT DELIVERY
The Fund will furnish, without charge, a copy of its Annual Report for the
fiscal year ended December 31, 1996 to any stockholder upon request. Contact the
Fund c/o Shay Assets Management Co. at 111 East Wacker Drive, Chicago, Illinois
60601 or call 800-661-3938 to request a copy of the Annual Report.
STOCKHOLDER PROPOSALS FOR THE 1998 ANNUAL MEETING
Any stockholder proposal intended to be presented at the 1998 Annual
Meeting of the Fund must be received by the Fund at the offices of its
administrator, PFPC, Inc., at P.O. Box 8905, Wilmington, Delaware 19809 on or
before December 18, 1997 in order for such proposal to be considered for
inclusion in the Fund's proxy statement and form of proxy relating to that
meeting.
By Order of the Board of Directors
Edward E. Sammons, Jr.
Edward E. Sammons, Jr.
Secretary
11
<PAGE> 14
PROXY M.S.B. FUND, INC. PROXY
PROXY FOR ANUAL MEETING OF STOCKHOLDERS - APRIL 17, 1997
The undersigned hereby appoints Harry P. Doherty and Michael J. Gagliardi as
Proxies, each with the power to appoint his substitute, and hereby authorizes
them to represent and to vote, as designated herein, all the shares of capital
stock of M.S.B. Fund, Inc. held of record by the undersigned on February 28,
1997, at the Annual Meeting of Stockholders to be held on April 17, 1997, or
any adjournment thereof.
This proxy is solicited on behalf of the Board of Directors. This proxy when
properly executed will be voted in the manner directed herein by the undersigned
stockholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR ALL
NOMINEES" IN PROPOSAL 1 AND "FOR" PROPOSAL 2. PLEASE MARK, SIGN, DATE AND
RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
NOTE: Please sign exactly as your name
appears below. When shares are held by
joint tenants, both should sign. When
signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full
corporate name by president or other
authorized officer. If a partnership,
please sign in partnership name by
authorized persons.
_______________________________________
Signature
_______________________________________
Authorized signature if held jointly
Dated __________________________, 1997
<PAGE> 15
<TABLE>
<S> <C>
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. THE DIRECTORS RECOMMEND VOTING "FOR" ALL NOMINEES AND PROPOSALS.
1. ELECTION OF DIRECTORS -- To withhold Authority to vote for any individual
nominee, strike a line through the name below.
FOR ALL NOMINEES / / WITHHOLD AUTHORITY / / TO VOTE FILL IN BOX COMPLETELY
except as marked to the to vote for all nominees
contrary below listed below
NOMINEES: Timothy A. Dempsey David F. Holland George J. Kelly Norman W. Sinclair Ian D. Smith
FOR AGAINST ABSTAIN
2. The ratification of the selection of KPMG Peat Marwick LLP as Independent Auditors. / / / / / /
3. In their discretion, the Proxies are authorized to vote upon such other business as may
properly come before the meeting or any adjournment thereof.
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