All Seasons Global Fund, Inc.
250 Park Avenue South
Winter Park, Florida 32789
1-800-432-0000
July 19, 1996
Dear Fellow Stockholder:
I am writing this letter to you because I have come to a very
important and intensely personal decision: I am recommending that
stockholders entrust the management of our Fund to someone else.
While it is never easy to relinquish something you have developed and
nurtured over the years, I believe that the Fund and the stockholders will
benefit from the proposals which this proxy statement recommends for your
approval.
The prime factors in recommending your approval of these changes are
the costs of operating our Fund and enhancing stockholder value. As you
know, the Fund now operates as a stand-alone fund. The Fund must therefore
bear all of the overhead expenses which otherwise might be spread among an
entire group of funds. The Board has concluded that, in the long run, this
will make it difficult for our Fund to achieve the economies of scale which
we seek for our stockholders.
The proposed investment advisor, Quest Advisory Corp., is headed by
Charles M. Royce, its CEO and Chief Investment Officer, and is the advisor
for The Royce Funds.
o Chuck Royce and his firm have been in the investment advisory field
for over twenty years.
o Quest manages over $2.0 billion of private client and investment
company assets, including nine mutual fund portfolios and two closed-
end funds such as ours.
o Quest's closed-end funds trade at a discount which is less than the
Fund's. Mr. Royce is a stockholder of both of these funds.
o Our Fund will benefit from the sharing of certain operating expenses
and other economic advantages, which are described in the proxy
statement.
o THE NEW INVESTMENT ADVISOR HAS AGREED TO REDUCE ITS FEES IF NECESSARY
TO LIMIT FUND OPERATING EXPENSES FOR SEVERAL YEARS TO A LEVEL WHICH IS
BELOW THE PRESENT OPERATING EXPENSE LEVEL OF THE FUND.
o Quest uses a "value" approach to investing, which has generally
produced low volatility. Quest attempts to identify and invest in
securities which sell at a discount from Quest's estimate of the
"worth" of the issuing company. Quest and its funds currently employee
45 people, and Quest has been successful in maintaining relatively low
operating expense levels for those funds. The combined effect of lower
expenses and value investing offer stockholders a better opportunity to
achieve the Fund's goals in the future.
The enclosed proxy statement describes the proposals to be voted on at
this Annual meeting of stockholders. The proposals include a new Investment
Advisory Agreement with Quest Advisory Corp., the election of nominees who
serve as directors or trustees for the other registered investment
companies advised by Quest, and changes in the Fund's stated investment
objective and in its charter to facilitate implementing the investment
style of Quest.
Finally, I want to thank all of you for your strong support and
encouragement over the years, since the inception of our Fund. It has been
a privilege to have served you and I am indeed grateful.
Sincerely yours,
DIEGO J. VEITIA
Chairman
P.S. YOUR VOTE IS VERY IMPORTANT! If the Fund does not receive a
sufficient number of votes prior to the meeting date, it will have to
engage in additional proxy solicitation, and the meeting may have to be
postponed. PLEASE COMPLETE, SIGN AND MAIL YOUR PROXY CARD AS SOON AS
POSSIBLE. If you have any questions regarding the proxy material, please
call Investor Information at 1-800-432-0000, Ext. 324.
<PAGE>
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
All Seasons Global Fund, Inc.
To the Stockholders of All Seasons Global Fund, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of All
Seasons Global Fund, Inc. (the "Fund") will be held at the Langford Resort
Hotel, 300 East New England Avenue, Winter Park, Florida, on August 29,
1996 at 10:00 a.m. (Eastern time) for the following purposes:
1. To approve a new Investment Advisory Agreement between the
Fund and Quest Advisory Corp.
2. To elect a board of four directors.
3. To approve a change in the Fund's fundamental investment
objective as set forth herein.
4. To approve Amended and Restated Articles of Incorporation for
the Fund.
5. To ratify the selection of Ernst & Young LLP as independent
public accountants of the Fund for the year ending December
31, 1996.
6. To transact such other business as may properly come before
the meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on July 15, 1996 as
the record date for the determination of those stockholders entitled to vote at
the meeting, and only holders of record at the close of business on that day
will be entitled to vote.
The Fund's Annual Report to Stockholders for the year ended December 31,
1995 was previously mailed to stockholders, and copies of it are available upon
request, without charge, by writing to the Fund at 250 Park Avenue South, Suite
200, Winter Park, Florida 32789 or calling toll free at 1-800-432-0000, Ext 324.
IMPORTANT
To save the expense of additional proxy solicitation, if you do not now
expect to be present at the meeting, please mark your instructions on the
enclosed Proxy, date and sign it and return it in the enclosed envelope (which
requires no postage if mailed in the United States). The enclosed Proxy is
solicited on behalf of the Board of Directors, is revocable and will not affect
your right to vote in person in the event that you attend the meeting.
By order of the Board of Directors.
Diego J. Veitia
Chairman
July 19, 1996
<PAGE>
ANNUAL MEETING OF STOCKHOLDERS
ALL SEASONS GLOBAL FUND, INC.
250 Park Avenue South
Suite 200
Winter Park, Florida 32789
_______________________
PROXY STATEMENT
____________________
This proxy statement is furnished in connection with the solicitation of
proxies by or on behalf of the Board of Directors (the "Board") of All Seasons
Global Fund, Inc. (the "Fund") for use at the Annual Meeting of Stockholders
(the "Annual Meeting") to be held at the Langford Resort Hotel, 300 East New
England Avenue, Winter Park, Florida, on August 29, 1996 at 10:00 a.m. local
time.
The approval by stockholders of the matters expected to be presented at
this meeting would result in the Fund becoming a member of The Royce Funds, a
group of registered closed-end and open-end investment companies with over $1.6
billion in assets, and would assign the management of the assets of the Fund to
Quest Advisory Corp., the investment advisor to The Royce Funds. The proposals
would:
o Make Quest the Fund's investment advisor under a new
investment advisory agreement similar to those of The
Royce Funds, at a rate of compensation that is consistent
with that currently being paid by the Fund, and with an
expense limitation that will ensure a reduction in the
Fund's operating expenses below the Fund's historical
levels through December 31, 1998 (Proposal 1);
<PAGE>
o Select for our Fund the Directors and the independent
accountants of the two closed-end funds currently advised
by Quest (Proposals 2 and 5);
o Modify the Fund's stated investment objective (Proposal
3); and
o Rename the Fund as the Royce Global Trust, Inc., and
authorize the Fund to issue and sell shares of its capital
stock to the same extent, and on the same basis,
as Quest's closed-end funds (Proposal 4).
Proxy Solicitation
All proxies in the enclosed form which are properly executed and returned
to the Fund prior to the close of business on August 27, 1996, will be voted as
provided therein at the Annual Meeting or at any adjournment thereof. A
stockholder executing and returning a proxy has the power to revoke it at any
time before it is exercised by giving written notice of such revocation to the
Secretary of the Fund. Signing and mailing the proxy will not affect your right
to give a later proxy or to attend the Annual Meeting and vote your shares in
person. The Fund believes that under Maryland law, abstentions and broker
non-votes may be included for purposes of determining whether a quorum is
present at the meeting, but would not be treated as votes cast and, therefore,
would not be counted for purposes of determining whether matters to be voted on
at the meeting have been approved.
The Board intends to bring before the meeting the matters set forth in
Proposals 1 through 5 in the foregoing notice. The persons named in the enclosed
proxy and acting thereunder will vote with respect to Proposals 1 through 5 in
accordance with the directions of the stockholder as specified on the proxy
card. If no choice is specified, the shares will be voted IN FAVOR of the
approval of the new Investment Advisory Agreement between the Fund and Quest
Advisory Corp. set forth in Proposal 1, IN FAVOR of the election of the four
nominees named under Proposal 2, IN FAVOR of the approval of a change in the
Fund's fundamental investment objective as set forth in Proposal 3, IN FAVOR of
the approval of Amended and Restated Articles of Incorporation for the Fund as
set forth in Proposal 4, and IN FAVOR of ratification of Ernst & Young, LLP as
auditors as et forth in Proposal 5.
If stockholders owning a sufficient number of shares are not present at the
meeting in person or by proxy so as to constitute a quorum, or to approve any
one or more items recommended by the Board, the stockholders present may propose
to adjourn the meeting to a later date as to any matter or matters to permit the
solicitation of additional proxies. In such case, the named proxies may vote in
favor of such adjournment all proxies directing or authorizing a vote in favor
of any matter to be considered at such adjourned meeting. If any other matters
are properly presented to the meeting for action, it is intended that the
persons named in the enclosed proxy and acting thereunder will vote in
accordance with the views of management thereon. If Proposal 1 (the new
Investment Advisory Agreement) is not approved by stockholders, then the Board
will not present Proposals 3, 4, or 5 for consideration at the meeting. This
proxy statement and form of proxy are being sent to stockholders on or about
July 19, 1996
With respect to the election of directors (Proposal 2), the four nominees
receiving the greatest number of votes will be elected. The affirmative vote of
a majority of the outstanding voting securities of the Fund, as that term is
defined in the Investment Company Act of 1940 (the "1940 Act"), is required to
approve the proposed Investment Advisory Agreement (Proposal 1), and the change
in the investment objective (Proposal 3). Under the Articles of Incorporation of
the Fund, the affirmative vote of a majority of the outstanding voting
securities of the Fund (as defined under Maryland law) is required to approve
the amendment and restatement of the Articles of Incorporation as proposed
(Proposal 4). The affirmative vote of a majority of the votes cast at the
meeting is required for ratification of the selection of independent public
accountants (Proposal 5).
The Fund normally would bear the entire cost of preparing, printing and
mailing this proxy statement, the proxies and any additional materials which may
be furnished to stockholders, and of any additional solicitation which might be
required to convene and hold the meeting. In recognition of the costs assumed by
the Fund in connection with the submission to stockholders of the matters
addressed in this proxy statement, the present and the proposed investment
advisor have each agreed to bear one half of the costs of calling and holding
this stockholders' meeting, and of preparing, printing, and mailing this proxy
statement, form of proxy, and any other materials required or costs incurred.
Solicitation may be undertaken by mail, telephone, telegraph and personal
contact. Some officers and employees of the Fund and/or Veitia and Associates,
Inc. (the "Present Advisor"), the Fund's investment advisor, may solicit proxies
personally and by telephone, if deemed desirable. Although the Fund has not
contracted for specific services at this time, the Fund has arranged for
Shareholder Communications Corp. to serve as solicitors for the Fund. The Fund
expects that such solicitation arrangements would include telephone or other
contacts with stockholders of the Fund to ensure the presence of a quorum, and
other activities which the Board may deem to be in the best interests of the
Fund and its stockholders. It is not anticipated that such solicitation will
involve any expense to the Fund, as any such costs will be paid by the present
and the proposed investment advisors. The Annual Report of the Fund for its
fiscal year ended December 31, 1995 was mailed to stockholders of record on
approximately March 1, 1996, and has thereafter been mailed to persons who have
become stockholders of record entitled to vote at this meeting.
Voting Securities and Principal Holders Thereof
Holders of Common Stock of the Fund of record at the close of business on
July 15, 1996 will be entitled to vote at the Annual Meeting or any adjournment
thereof. As of July 15, 1996, the Fund had outstanding 7,998,419 shares of
Common Stock. The stockholders are entitled to one vote per share on all
business to come before the meeting. The Fund has been notified by a filing made
on Schedule 13D that Steel Partners II, L.P. and Steel Partners Services Ltd.,
in the aggregate, control and have dispositive powers over shares of common
stock in excess of 5%, and Warren Lichtenstein, and Lawrence Butler may be
deemed to control and have dispositive power over such shares through such
entities. The officers and directors of the Fund as a group beneficially own in
the aggregate less than 1% of the outstanding Common Stock of the Fund.
The following persons were known by the Fund to be beneficial owners or
owners of record of 5% or more of its outstanding shares of Common Stock as of
the record date:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
NAME AND ADDRESS AMOUNT AND NATURE OF OWNERSHIP PERCENTAGE OF
OF OWNER CLASS
- ------------------------------------------- ------------------------------------------ ------------------------------------------
Steel Partners II, L.P. Aggregate Amount 8.8%
750 Lexington Avenue 721,950
New York, New York 10022 Beneficial
Steel Partners Services, Ltd. Aggregate Amount .9%
75,086
Warren Lichtenstein Aggregate Amount 9.7% (1)
797,036
Lawrence Butler Aggregate Amount 9.7% (1)
797,036
</TABLE>
(As of Dec. 27, 1995)
Magten Asset Management Corp. Aggregate amount 11.7% (2)
35 East 21st Street 933,700
New York, New York 10010 Beneficial
(1) This 9.7% represents the same 8.8% beneficially owned by Steel Partners
II, L.P. and the .9% beneficially owned by Steel Partners Services, Ltd. for a
total percentage of 9.7%.
(2) These shares have been reported by the company to the Securities and
Exchange Commission on a Schedule 13G which states that the shares "were not
acquired for the purpose of and do not have the effect of changing or
influencing the control" of the Fund. Of this 11.7%, General Motors Employees
Domestic Group Pension Trust, an advisory client of Magten Asset Management
Corp., has an interest with respect to more than five percent of the class of
securities to which this proxy relates.
Mr. Royce has advised the Fund that, as of the date of this proxy
statement, he does not own shares of the Fund. However, Mr. Royce has advised
the Board that he is a stockholder in both of the closed-end funds which are
advised by Quest, and that, subject to compliance with applicable securities
laws, he intends to purchase approximately $1 million of the Fund's common stock
in the open market during the six-month period after the closing of the
Transaction described below.
<PAGE>
Proposal 1. APPROVAL OF NEW INVESTMENT ADVISORY AGREEMENT
The Fund presently receives investment advice and related advisory services
pursuant to a written Investment Management Agreement (the "Present Agreement")
between Veitia and Associates, Inc. (the "Present Advisor"), a Florida
corporation with offices located at 250 Park Avenue South, Suite 200, Winter
Park, Florida, 32789, and the Fund. At the meeting, it is proposed that the
stockholders approve a new investment advisory agreement (the "New Agreement")
with Quest Advisory Corp. ("Quest") to replace the Present Agreement. Quest,
which is located at 1414 Avenue of the Americas, New York, New York 10019, is
the investment advisor of other open-end and closed-end management investment
companies (collectively, "The Royce Funds").
If the New Agreement is approved by the stockholders at this meeting, it
will become effective upon the closing of a transaction (the "Closing")
described under "INFORMATION CONCERNING THE PROPOSED SALE OF ASSETS TO QUEST"
below, pursuant to which the Present Advisor will sell to Quest certain assets
used by the Present Advisor in the conduct of its business as the advisor to the
Fund. It is anticipated that the Closing will occur shortly following the
stockholders meeting. The Closing is not required to proceed if the stockholders
do not approve the New Agreement and elect as directors of the Fund the nominees
identified in Proposal 2 below. If the New Agreement is not approved by the
stockholders, or the Closing does not occur for any other reason, then the
Present Agreement will remain in effect, and the Board of Directors of the Fund
will consider what further steps, if any, are necessary or appropriate in
connection with the conduct of the business of the Fund.
The Present Agreement
Veitia and Associates, Inc. presently serves as the Fund's manager and
investment adviser under the Present Agreement dated February 1, 1992, which was
approved by the Board of the Fund at its meeting held on September 21, 1991, and
by the stockholders of the Fund at a meeting held on January 20, 1992.
Continuance of the Present Agreement was last approved by the Fund's Board on
December 8, 1995, and it will remain in effect until January 31, 1997, unless it
is terminated sooner or is replaced by the New Agreement.
Under the Present Agreement, the Present Advisor manages the investment
operations of the Fund and the composition of the Fund's portfolio in accordance
with the Fund's stated investment objective, policies and restrictions and
subject to the supervision of the Board of Directors. The Present Advisor
selects brokers and dealers to execute transactions for the Fund, maintains
certain books and records in connection with its services to the Fund and
furnishes facilities required by the Fund for investment activities. The Present
Advisor authorizes any of its directors, officers and employees who have been
elected as directors or officers of the Fund to serve in the capacities in which
they have been elected. The Present Advisor also administers the Fund's general
business affairs subject to the supervision of the Fund's Board of Directors and
its officers.
Except as set forth herein, the Fund pays its own expenses. The Present
Advisor incurs its expenses of performing its duties under the Present
Agreement, including services it is required to provide to the Fund under such
agreement. Other than a state expense limitation, there are no voluntary expense
limitations by the Present Advisor relating to the Fund's operating expenses.
The Present Advisory Fee
As compensation for its services under the present Agreement, the Present
Advisor receives a fee at an annualized rate of (a) 1.0% of the Fund's average
daily net assets up to the first $100,000,000 of assets, (b) 0.85 of 1% of
average daily net assets in excess of $100,000,000 but not in excess of
$250,000,000, and (c) 0.70% of 1% of average daily net assets in excess of
$250,000,000. During the fiscal year ended December 31, 1995, the Fund paid the
Present Advisor investment advisory fees aggregating $413,686.
The New Agreement
The principal differences between the form of the Present Agreement and the
form of the New Agreement, in addition to the identity of the parties, are (i)
the elimination of certain asset-based fee reduction provisions in the Present
Agreement, and (ii) the assumption by the Fund of the cost of certain ancillary
services which are presently provided to the Fund at the Advisor's expense.
Under the New Agreement, Quest will determine the composition of the Fund's
portfolio, the nature and timing of changes in it and the manner of implementing
the changes; it will provide the Fund with investment advisory, research and
related services for the investment of the Fund's assets; it will furnish,
without expense to the Fund, the services of those of its executive officers and
full-time employees as may be duly elected executive officers or directors of
the Fund; and it will pay all the salaries and expenses of such persons. For
purposes of the New Agreement, only a president, a treasurer or a vice-president
in charge of a principal business function shall be deemed to be an executive
officer. Quest will also pay all expenses which it may incur in performing its
investment advisory duties under the New Agreement and shall reimburse the Fund
for any space leased by the Fund and occupied by Quest.
The obligation of the Fund to pay its own expenses will cause it to bear
certain expenses for services which are now provided to the Fund without
reimbursement by the Present Advisor under the Present Agreement. Quest has
advised the Board of the Fund that economies of scale should result from the
larger asset base of The Royce Funds, and that these economies of scale should
be substantially more significant to the Fund than the cost of the services
which the Fund will now bear. To assure that the Fund is benefitted by the
proposals reflected in this proxy statement, including the approval of the New
Agreement, Quest has committed to the Fund that it will waive collection of its
advisory fee to the extent necessary to limit the operating expenses of the Fund
as described below.
Quest will waive collection of its fee as required if operating expenses of
the Fund exceed 1.75% of average daily net assets during calendar years 1997 and
1998, or 2.0% of such net assets for the portion of 1996 during which Quest
serves as the Fund's advisor (including, in each case, fees payable to Quest,
but excluding interest, dividends on securities sold short, taxes, brokerage
commissions, distribution fees, amortization of organization expenses,
litigation, and extraordinary expenses). The officers of the Fund estimate,
based upon the Fund's 1995 operating expense ratio of 2.4%, that Quest's
undertaking should result in a level of operating expenses for the Fund which is
less than the Fund would have without the New Agreement.
Quest is the investment adviser of Royce Micro-Cap Trust, Inc. ("RMT"),
Royce Value Trust, Inc. ("RVT") and nine series of The Royce Fund ("TRF"),
registered management investment companies. These funds or series have assets
ranging from approximately $000,000 to $000,000,000 (as of June 30 1996) and
compensate Quest at rates of up to 1.5% of their respective average net assets.
Quest has generally voluntarily reduced its compensation under its contracts
with these funds or series to the extent necessary to maintain expenses, other
than interest expense, at or below 1.99% of average net assets.
The name and principal occupation of the principal executive officers and
each director of Quest is set forth in the table below. The address of the
persons named below is 1414 Avenue of the Americas, New York, New York 10019.
<PAGE>
NAME PRINCIPAL OCCUPATION
- ---------------- -----------------------------------------------
Thomas R. Ebright ............ Vice President of Quest and TRF; director of RVT
and RMT; President and Treasurer of QDI;
President, Treasurer and director and principal
shareholder of Royce, Ebright and Associates,
Inc., a registered investment advisor and
director of Atlantic Pro Sports, Inc. and the
Strasburg Rail Road Co.
W. Whitney George ............ Vice President and senior analyst of Quest;
Vice President of RVT, RMT and TRF and general
partner of QMC
Jack E. Fockler, Jr. ........... Vice President and senior associate of Quest;
Vice President of RVT, RMT and TRF; Vice
President of QDI and general partner of QMC
Daniel A. O'Byrne .............. Vice President of Quest and RVT, RMT and TRF.
John E. Denneen ................ Associate General Counsel and Chief Compliance
Officer of Quest and Secretary of RVT, RMT and
TRF
The proposed Investment Advisory Agreement between the Fund and Quest would
become effective on the first business day following the sale of certain assets
by the Present Advisor to Quest, which will occur shortly following approval of
the New Agreement by the Fund's stockholders. The text of the proposed New
Agreement is set forth in Exhibit A to this Proxy Statement.
The New Advisory Fee
<PAGE>
As compensation for its services under the Proposed Agreement, Quest would
receive a monthly fee equal to 1/12 of 1% (1% on an annualized basis) of the
average net assets of the Fund for each month during the term of the Proposed
Agreement.
Based upon the current size of the Fund, the asset-based fee reduction
provisions in the Present Agreement do not provide any present benefit to the
Fund, and therefore the same fee would have been paid if the New Agreement had
been in effect during the last fiscal year. In addition, the present Board of
the Fund, for reasons set forth in more detail herein, has concluded that the
economies of scale which the Fund should obtain by becoming a part of a larger
group of investment companies will significantly outweigh any benefit which the
Fund might reasonably expect to derive from the fee reduction schedule of the
Present Agreement.
The Board's Approval of the New Agreement
In deciding to recommend to stockholders that they approve the New
Agreement with Quest, the Fund's Board considered:
- - the expected benefits to the Fund of participation in a multiple-fund complex,
including economies of scale which can be achieved by the Fund as certain fixed
costs are allocated over a larger number of funds and over a larger asset base.
- - the financial commitment made to the Fund by Quest, which has (as described
above) agreed to limit Fund operating expenses to levels below the current range
during the remainder of the current fiscal year and for the next two fiscal
years following the approval of the New Agreement.
- - the historically better operating expense levels of many of the funds advised
by Quest.
- - the fact that Quest is already experienced in the operation of closed-end
funds, and proposes to bring to the Fund the same value-oriented investment
approach which it employs for all of its funds.
- - the established investment advisory business of Quest, and the experienced
principals and contacts of that firm.
- - the commitments made to the Fund by Quest concerning certain investment
techniques which the Fund may employ (as described in more detail below).
- - the experience level of the affiliated and independent directors of the fund
complex.
The Board considered the matter of the New Agreement after requesting and
obtaining from Quest: (i) substantial written material concerning Quest and the
directors of the closed-end funds advised by Quest; (ii) material concerning the
funds advised by Quest; (iii) information concerning the performance of the
funds advised by Quest; and (iv) regulatory, compliance, and procedural
information concerning the operation of The Royce Funds and Quest. The Board
also arranged for two Fund Directors to visit the offices of Quest and review
the facilities used for The Royce Funds.
Not all factors considered by the Board were accorded equal significance in
the deliberations of the Board. The Fund's Directors concluded, among other
things, that if the proposals were approved the per share cost of operating the
Fund would be likely to be reduced. This conclusion was based upon both an
analysis of the historical operating experience of The Royce Funds, and the
specific expense limitation commitment which has been made to the Fund by Quest.
The Board believes that, given the impact of operating expenses on the
performance of funds generally, this was perceived to be a significant positive
factor.
The Directors also determined that Quest's commitment to conduct the
investment operations of the Fund in conformity with both the policy and mission
statements reflected below was significant, because it would provide
stockholders with assurances that the assets of the Fund would be managed with
techniques which were generally used by Quest for The Royce Funds, and would not
subject stockholders to risks related to investment techniques which Quest
generally does not use for The Royce Funds.
QUEST'S INVESTMENT APPROACH
Quest has advised the Fund's Board that, subject to the investment
objective, policies, and restrictions of the Fund, it expects to invest the
assets of the Fund as set forth in the following statement:
"The Fund's investment objective is long-term capital appreciation. It will
seek to achieve this objective by normally investing more than 75% of its
assets in domestic and foreign common stocks, securities convertible into
common stocks and other equity securities.
Questwill use a "value" method in managing the Fund's assets. In its
selection process, Quest will put primary emphasis on the
understanding of various internal returns indicative of profitability,
balance sheet quality, cash flows and the relationships that these
factors have to the price of a given security. Quest's value method is
based on its belief that the securities of certain companies may sell at
a discount from its estimate of such companies' "private worth",that is,
what a knowledgeable buyer would pay for the entire company. Quest will
attempt to identify and invest in these securities for the Fund, with the
expectation that this "value discount" will narrow over time and thus
provide capital appreciation for the Fund.
Quest believes that valuation discrepancies exist globally among many
companies without regard to their stock market capitalizations. For
this reason, Quest will retain the Fund's global focus and will not
limit the stock market capitalizations of the companies in which it
may invest.
The Fund will normally invest more than 65% of its assets in securities of
companies of at least three countries, including the United States. In most
instances, investments will be made in companies principally based in
the United States or the other developed countries of North America,
Europe, Asia and Australia and not in emerging markets countries.
Quest intends to invest primarily in American Depository Receipts and
European Depository Receipts and U.S. exchange-listed securities.
Although the Fund is not restricted from entering into forward currency
exchange contracts or engaging in short sales, Quest has no current
intention to use such investment techniques and will not use such
techniques without prior approval from the Fund's Board of Directors.
The assets of the Fund that are not required to be invested in the equity
securities of domestic and foreign companies may be invested in the
non-convertible preferred stocks and debt securities of domestic and
foreign companies.
The Fund may also indirectly invest in the securities of domestic and
foreign companies by investing in the securities of other investment
companies that invest primarily in such companies. The other
investment companies in which the Fund may invest may be domestic
companies registered under the 1940 Act or foreign companies that are
not so registered or otherwise regulated. They usually have their own
management fees and expenses, and Quest will also earn its fee on Fund
assets invested in such other companies, which would result in a
duplication of fees to the extent of any such investment. However,
Quest will waive its management fee on any Fund assets invested in
other open-end investment companies, and no sales charge will be
incurred on such an investment."
INVESTMENT OPERATIONS COMMITMENT FROM QUEST
When the Fund was established, it was designed to permit the investment
manager of the Fund substantial flexibility with respect to the conduct of the
Fund's investment activities. This included authority to make direct investments
in foreign securities in both established and emerging markets, authority to use
techniques such as short sales, options, and foreign currency futures. While
these and many other investment techniques authorized were intended to be used
conservatively (such as the use of foreign currency futures to hedge risk and
not for speculative purposes), each technique does involve investment risk.
Quest has not used to a significant extent a number of the investment
techniques which an advisor to the Fund would otherwise have authority to use,
and does not believe that it will require the use of most of these techniques
for the effective investment of the assets of the Fund. Quest therefore has made
a written representation to the Board that it does not presently intend to use
such investment techniques when it assumes responsibility for the management of
the Fund's investments.
If, at any time in the future, Quest believes that its use of any one or
more of these investment techniques is in the interest of the Fund, it will
advise the Board of the Fund of its conclusion, and will request authority for
the use of such investment technique from the Board. Quest will not utilize the
technique until the Board has authorized its use. These non-fundamental
limitations on the scope of the investment techniques which may be used for the
Fund are believed to complement the change in the Fund's fundamental investment
objective recommended for stockholder approval in Proposal 3 below.
The non-fundamental investment techniques and limitations proposed are:
(a) Quest will not cause the Fund to make new investments which would cause
more than 50% of the Fund's assets to be invested in equity securities traded
exclusively in markets outside the U.S.
(b) Quest will not cause the Fund to make new investments in emerging market
countries.
The above limitations will not prevent the Fund from purchasing sponsored or
unsponsored depository receipts trading within the U.S. and/or developed markets
in Europe which represent an interest in foreign equity securities trading in
other markets, including securities of issuers located or trading in emerging
market countries.
(c) Quest will not cause the Fund to make new investments which would cause more
than 25% of the Fund's assets to be invested in non-equity securities traded
exclusively in markets outside the U.S.
(d) Quest will not cause the Fund to make new investments which would cause more
than 10% of the Fund's assets to be invested in below investment grade
non-convertible preferred stock or non-convertible debt securities.
(e) Quest will not cause the Fund to deal in foreign currency futures, either
for speculative or hedging purposes, except as necessary to close out any
futures position held by the Fund when Quest becomes the advisor.
(f) Quest will not cause the Fund to engage in "swaps," or to invest in put or
call options, or to invest more than 10% of its assets in illiquid securities -
i.e. securities for which market quotations are not readily available.
(g) Quest will not cause the Fund to make short sales of securities, other than
short sales against the box in which, at the time of the short sale, the Fund
holds or has an unrestricted right to receive the security to be sold short.
(h) Quest will not cause the Fund to invest in derivative securities of a
speculative nature, but such limitation is not intended to prevent the Fund from
using investments in repurchase agreements, reverse repurchase agreements,
warrants, rights, and convertible securities.
(i) Quest will not cause the Fund to borrow from banks for leveraging purposes,
but the Fund may issue other senior securities under Section 18 of the 1940 Act.
INFORMATION CONCERNING THE PROPOSED SALE OF ASSETS TO QUEST
Under an Asset Purchase Agreement dated as of June 3, 1996, the Present
Advisor agreed to sell to Quest its business and assets relating to the
administration and management of the Fund's assets (the "Transaction"). The
terms of the Transaction provide for the sale to Quest of certain intangible
assets and books and records which are used by the Present Advisor for its
service as an investment advisor and administrator to the Fund. The Asset
Purchase Agreement provides that the obligation of the parties to consummate the
Transaction is subject to the approval by stockholders of the proposed
Investment Advisory Agreement between the Fund and Quest and to the election of
the nominees identified in Proposal 2 below as Directors of the Fund.
The Fund is a third-party beneficiary of certain sections of the Asset
Purchase Agreement dealing with Fund proxy solicitation and Fund meeting
expenses and, as such, may enforce these provisions against the Present Advisor
or Quest. The Fund will not bear the expense of soliciting the approvals
required for consummation of the Transaction, nor will it incur any contractual
obligations under the Asset Purchase Agreement.
Under the Asset Purchase Agreement, Quest does not assume any liabilities
of the Present Advisor, and will pay to the Present Advisor a purchase price of
$1,398,769, subject to an adjustment to reflect certain changes in the level of
the net assets of the Fund as of the closing date of the Transaction. This
payment is subject to the obligation of the selling party and Mr. Veitia to
indemnify Quest in the event of certain adverse diminutions in the net assets of
the Fund.
The Asset Purchase Agreement also provides that Quest and Mr. Veitia,
currently Chairman of both the Fund and the Present Advisor, will enter into a
Consulting Agreement. Under the Consulting Agreement, in consideration of
compensation of $675,000 payable in three annual payments, Mr. Veitia is
obligated to provide consulting services to Quest after the completion of the
Transaction, so that Quest may obtain certain assistance from Mr. Veitia.
According to the terms of the Consulting Agreement, for a period of three years
after consummation of the Transaction, Mr. Veitia will consult with, advise and
assist Quest's management with respect to (1) Fund stockholder communications
and servicing and (2) economic factors and trends affecting foreign economies
and markets. However, Mr. Veitia will not be permitted or required generally to
furnish advice or make recommendations regarding the purchase or sale of
securities.
Assuming the necessary conditions have been met, consummation of the
Transaction is expected to occur promptly following approval of the New
Agreement at the Fund's Annual Meeting of Stockholders, which is expected to
occur on or about August 29, 1996.
The parties to the Asset Purchase Agreement have agreed that the
Transaction, and the consideration paid pursuant to the Transaction, shall be
subject to Section 15(f) of the 1940 Act, which requires that: (i) for three
years following the Transaction, at least seventy-five percent of the Board of
the Fund shall consist of people who are not interested persons of the old or
the new advisor to the Fund, and (ii) no "unfair burden" shall be imposed upon
the Fund during the two years following the Transaction.
VOTE REQUIRED
The New Agreement between the Fund and Quest requires the approval of the
lesser of (i) 67% of the shares of the Fund's Common Stock present or
represented at the meeting (assuming that more than 50% of such shares are
present or represented) or (ii) more than 50% of the outstanding shares of the
Fund's Common Stock.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 1.
Proposal 2. ELECTION OF DIRECTORS
At the Annual Meeting, it is proposed to elect four directors, each
director to hold office until the next Annual Meeting of Stockholders and until
his successor shall have been elected and qualifies. The Fund's Board of
Directors has nominated the following four persons to become directors of the
Fund: Charles M. Royce, Richard M. Galkin, Stephen L. Isaacs and David L.
Meister (collectively, the "Nominees"). Certain information concerning the
Nominees is set forth below. Subject to the condition recited below, each of
these persons has agreed to serve if elected, and the Fund's management has no
reason to believe that any of them will be unavailable for election as a
director. However, each nominee has indicated that he will not be available to
serve in the event that stockholders do not approve the New Agreement
recommended in Proposal 1 above. If, for this or any other reason, any of them
become unwilling or unable to serve, the persons named in the accompanying form
of Proxy will vote for the election of such other persons, if any, as the Board
of Directors may nominate.
NAME PROPOSED POSITIONS WITH THE FUND AGE
- -------------------------- ------------------------------------ --------------
Charles M. Royce* Director, President and Treasurer 57
Richard M. Galkin Director 58
Stephen L. Isaacs Director 56
David L. Meister Director 56
* If elected to the Board of Directors, Mr. Royce would be deemed an
"interested person" of the Fund within the meaning of Section 2(a)(19) under the
1940 Act.
The Board has an Audit Committee, which is responsible for recommending the
selection and nomination of the independent auditors of the Fund and for
conducting post-audit reviews of the Fund's financial condition with the
auditors. The Audit Committee held two meetings during the year ended December
31, 1995, and each member of the Audit Committee attended both of the meetings.
The Board also has an Independent Directors Committee comprised of all of the
independent directors, which is responsible for reviewing any matters which may
affect affiliated entities of the Fund. The Independent Directors' Committee met
once in 1995, and both members attended the meeting. The Board of Directors also
has a Nominating Committee which is responsible for recommending to the Board
the persons to be nominated as directors of the Fund. The Nominating Committee
held one meeting during the year ended December 31, 1995, and each member of the
Committee attended the meeting. Stockholders who wish to bring a prospective
nominee to the attention of the Committee may do so by submitting a brief resume
of the prospective nominee to the Secretary of the Fund. The Board does not have
any other standing committees.
There are no family relationships between any of the Fund's directors
and officers.
During the Fund's current fiscal year, Stephen A. Saker, a director of the
Fund, failed to file on a timely basis a report required by Section 16(a) of the
Securities Exchange Act of 1934. Such report, which was filed with the
Securities and Exchange Commission on June 21, 1996, disclosed the sale of
146.34 shares of the Fund on May 20, 1996 by Mr. Saker's wife from her IRA
account for a total consideration of $576.59.
As of the record date, none of the Nominees owned of record or beneficially
any shares of the Fund's Common Stock.
BUSINESS EXPERIENCE OF CURRENT DIRECTORS AND NOMINEES
Set forth below is certain information as to the principal business
experience of the Nominees during the past five years.
Charles M. Royce is the President, Secretary, Treasurer and sole director
and sole voting shareholder of Quest, the proposed investment adviser to the
Fund. He became affiliated with Quest in June 1972, and has served as its
President and Treasurer since November 1972. Mr. Royce also manages three
private investment partnerships through Quest Management Company ("QMC"), a
registered investment adviser, of which he is the managing general partner.
Richard M. Galkin is a private investor and President of Richard M. Galkin
Associates, Inc., tele-communications consultants.
Stephen L. Isaacs is an attorney, Director of the Columbia University
Development Law and Policy Program, a Professor at Columbia University and
President of Stephen L. Isaacs Associates, Consultants.
David L. Meister is a consultant in the communications industry. He was an
executive officer of Digital Planet Inc. from April 1991 to December 1992.
Mr. Royce is also President and Treasurer of Royce Micro-Cap Trust, Inc.
("RMT"), Royce Value Trust, Inc. ("RVT"), and The Royce Fund ("TRF"), registered
management investment companies. Messrs. Royce, Galkin, Isaacs and Meister are
also directors/trustees of RMT, RVT, and TRF. Mr. Royce is also the sole
shareholder and director and Secretary of Quest Distributors, Inc., the
distributor of TRF's shares.
Set forth below is certain information as to the principal business
experience of the Fund's current directors during the past five years.
Diego J. Veitia is the Chairman of the Present Advisor (since 1991),
International Assets Advisory Corporation ("I.A.A.C."), an affiliate of the
Present Advisor, (since 1981), Global Assets Advisors, Inc. (since 1994),
International Assets Holding Corporation (since 1987) and America's All Seasons
Income Fund, Inc. (since 1988). Mr. Veitia has been Chairman of the Fund since
1987.
Robert A. Miller, Ph.D. is the Academic Vice President of Queens College
(since July 1994) and was Provost of Antioch University from August 1991 to July
1994. Prior to August 1991, he was Dean of The Hamilton Holt School, Rollins
College. Dr. Miller has been a director of the Fund since 1987 and America's All
Seasons Income Fund, Inc. since 1988.
Adrian Day, an investment advisor and writer, is the Editor of Investment
Analyst, an investment newsletter (since 1987), President of Global Strategic
Management, Inc., a money management firm (since 1991), President of Investment
Consultants International, Ltd. (since 1981), Director of Telegold Ltd. (since
1995). Mr. Day was formerly President of Day Assets Ltd. (1988 to 1992),
Director of North Lily Mining (until 1993) and Director of Vidatron Consultants
(until 1993). Mr. Day has been a director of the Fund and America's All Seasons
Income Fund, Inc. since 1990.
Jerome F. Miceli is President of Global Assets Advisors, Inc. (since May
1994), Chief Executive Officer (since September 1992) and President (since June
1990) of I.A.A.C., Director and Chief Operating Officer of the Fund's Present
Advisor (since November 1990). Mr. Miceli has been a director and Treasurer of
the Fund and a director of America's All Seasons Income Fund, Inc. since 1990.
Stephen A. Saker is Director and Vice President of I.A.A.C. (since June
1985), Executive Vice President (since 1993) and Secretary (since 1988) of
America's All Seasons Income Fund, Inc. and Secretary of the Fund since 1987. He
has been a director and Secretary of International Assets Holding Corporation
since 1987. Mr. Saker has been the Secretary of Global Assets Advisors, Inc.
since 1994 and a director of the Fund since 1987.
Michael Petrino has held the position of President of Calport Asset
Management, a registered investment advisor, since July 1991. He has been a
director of the Fund since 1995.
REMUNERATION OF DIRECTORS AND OFFICERS
None of the Nominees is, or has ever served as, a director of the Fund,
or received any compensation from the Fund as a director, officer, or
otherwise.
Each of the Fund's current directors who is not an affiliated person (as
defined in the 1940 Act) of the Present Advisor receives as compensation an
annual fee of $7,500 and a fee for each meeting attended of $750. The Fund also
reimburses all directors for expenses incurred in connection with attending
Board meetings. The Present Advisor has, as required by its agreement, borne the
cost of all fees, salaries or other remuneration of officers of the Fund who
also serve as directors, officers, employees or special consultants to the
Present Advisor. All current officers are covered by this provision and did not
receive any compensation from the Fund during the fiscal year ended December 31,
1995. Set forth below is the compensation paid by the Fund to each of its
current directors during the fiscal year ended December 31, 1995.
NAME AGGREGATE COMPENSATION TOTAL COMPENSATION
FROM THE FUND FROM THE FUND
- -------------------------- ----------------------- -------------------------
Diego J. Veitia $0 $0
Robert A. Miller, Ph.D. 10,250 10,250
Adrian Day 10,250 10,250
Jerome F. Miceli 0 0
Stephen A. 0 0
Saker
Michael Petrino 5,250 5,250
===================== ============================== ======================
VOTE REQUIRED
A quorum consists of stockholders representing a majority of the
outstanding shares of the Fund entitled to vote who are present in person or by
proxy, and a plurality of all of the votes cast at a meeting at which a quorum
is present is sufficient to elect a director.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL NOMINEES.
Proposal 3. APPROVAL OF A CHANGE IN THE FUND'S FUNDAMENTAL INVESTMENT OBJECTIVE
This Proposal Will Be Presented For Action At The Meeting Only If
The Investment Advisory Agreement Recommended In Proposal 1 Is Approved
At The Meeting And The Nominees Identified In Proposal 2 Are Elected.
The Fund operates under an investment objective, and is subject to certain
investment restrictions, which may only be changed with the approval of the
stockholders. These provisions govern the way in which investments are selected
for the Fund. The objective sets the goal for the Fund, and the restrictions
limit activities in which the Fund might engage.
In connection with the proposal to appoint Quest as the new investment
advisor to the Fund, the Board reviewed the manner in which Quest advises other
investment companies, and evaluated the experience of Quest as an advisor. In
connection with the Board's consideration of the New Agreement, Quest indicated
to the Board that Quest would like to manage the assets of the Fund in a way
that draws upon Quest's historic strengths and areas of experience. It is the
view of both Quest and the Board that enabling Quest to manage the Fund's assets
in this way would offer the best chance of long-term success for the Fund and
its stockholders.
The Fund currently has the following investment objective:
"The objective of the Fund is to achieve long-term capital appreciation
without undue risk to preservation of capital. Any current income
achieved by the Fund will be incidental."
It is proposed that the investment objective of the Fund be changed to
read:
The Fund's investment objective is long-term capital appreciation. It
will seek to achieve this objective by normally investing more than
75% of its assets in common stocks, convertible preferred stocks,
convertible debentures and other equity securities."
To evaluate this proposal in context, stockholders should also consider the
statements provided by Quest describing how the Fund's investment activities
will be conducted if stockholders approve the New Agreement (see Proposal 1
above).
VOTE REQUIRED
In order to implement this change, the stockholders must approve it by the
affirmative vote of a majority of the outstanding voting securities of the Fund
as defined in the 1940 Act. Under the 1940 Act, a majority of the outstanding
voting securities at this meeting means the vote of 67% or more of the voting
securities present at the meeting, if more than 50% of the voting securities are
present in person or by proxy, or more than 50% of the outstanding voting
securities of the Fund, whichever is less.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 3.
Proposal 4. APPROVAL OF AMENDED AND RESTATED ARTICLES OF INCORPORATION
FOR THE FUND
This proposal will be presented for action at the meeting only if
the investment advisory agreement recommended in Proposal 1 is
approved at the meeting and the nominees identified in Proposal 2 are
elected.
The Board of Directors has approved Articles of Amendment and Restatement
(the "Amendment") to the Fund's Articles of Incorporation, which would modify
the rights of the directors and stockholders as described below. In accordance
with the General Corporation Law of Maryland (where the Fund is incorporated)
(the "GCL"), the Board recommends that the stockholders approve the Amendment.
While the principal purpose of the Amendment is to conform the Fund's
charter document to those of the other closed-end investment companies in
advised by Quest, the Amended and Restated Articles would make certain changes
which are material to the stockholders.
(i) The Amendment would change the name of the Fund to Royce Global
Trust, Inc.
The Board believes that the identification of the Fund as a member of The
Royce Funds would benefit the Fund. The Fund has been authorized by Quest to use
the term "Royce" as part of its name, subject to a provision in the New
Agreement which will require the Fund to change its name to eliminate the term
"Royce" from its name if neither Quest or any affiliate of Quest is the
investment advisor to the Fund.
(ii) The Amendment would permit the Board to authorize and issue
preferred stock without stockholder approval, and to modify the
structure of the Board of Directors and the voting rights of
stockholders with respect thereto in connection with the issuance of
senior securities.
Pursuant to the GCL, a corporation may provide in its charter that its
Board shall have the authority to reclassify, by resolution and without
stockholder approval, any authorized but unissued stock by changing certain
attributes of such stock, including dividend and liquidation preferences and
conversion and various other rights. The Amendment will expand the authority of
the Board in this area.
The present Articles of Incorporation grant the Board the authority to
issue one hundred million shares of capital stock of the Fund to be known and
designated as Common Stock. Under certain circumstances, the Board might also
issue certain debt obligations of the Fund. The Amendment would permit the Board
to issue, without stockholder approval, one or more series of preferred stock
that would have priority over shares of the Common Stock as to payment of
dividends and distribution of assets upon liquidation of the Fund. Senior
securities issued by the Fund could consist of preferred shares of the Fund's
capital stock, as authorized under Article IV, Section 5 of the Amendment, or
debt securities, as authorized under Article V, Section 2(iv) of the Amendment.
Furthermore, the Amendment includes certain charter provisions which are
necessary for compliance with requirements under Section 18 of the 1940 Act in
connection with the issuance of senior securities. Section 18 imposes asset
coverage provisions and dividend payment limitations on closed-end investment
companies issuing debt securities. If asset coverage requirements are not met,
holders of the securities must be given the right to elect at least a majority
of directors in certain cases. Preferred stockholders must have the right,
voting as a class, to elect at least two directors at all times and to elect a
majority of directors if dividends on their stock are unpaid for certain
periods. The Amendment would grant the Board the power to modify the structure
of the Board, or any voting right of stockholders with respect thereto, to the
extent necessary to comply with the aforementioned requirements under Section
18.
Although the two closed-end investment companies for which Quest serves as
the advisor have similar authority to issue preferred stock, Quest has advised
the Board that neither Quest nor the nominees for election to the Board
identified in Proposal 2 above have any present intention to have the Fund
exercise the power provided by this change.
(iii) The Amendment would authorize the Fund to issue shares of its
common stock for at less than the net asset value of the shares.
Under the 1940 Act, a closed-end investment company may only issue its
shares of common stock for less than the net asset value of such shares in
compliance with the provisions of that Act. (The language would not allow the
Fund to issue its shares for less than the par value, as required by the GCL.)
Quest has advised the Board that the two other closed-end funds for which it
acts as the investment advisor have the authority to issue shares for less than
net asset value, and have exercised that authority for two purposes permitted by
the 1940 Act
First, those investment companies have adopted "Automatic Distribution
Reinvestment Plan(s)" in connection with their payment of dividends and capital
gain distributions, to permit such payments to be made by issuing shares of
common stock, valued at the market price for such shares at the valuation date.
While any stockholder may elect to receive such payments in cash, Quest believes
that stockholders benefit from the acquisition of additional shares at a
discount from then current net asset value. Quest has advised the Board that it
expects to recommend the adoption of such a Plan to the new Board.
Second, a closed-end investment company may issue shares of its common
stock for less than the net asset value of such shares in connection with a
rights offering to existing stockholders. While both of the closed-end funds
advised by Quest have made such rights offerings, Quest has advised the Board
that neither Quest or the nominees named in Proposal 2 above have any present
intention of causing the Fund to make such a rights offering.
The proposed Amendment does NOT seek to modify or eliminate the provision
in the Fund's present Articles of Incorporation which requires that any proposal
to open-end, liquidate, or merge the Fund, or to modify the two thirds voting
provision, must be approved by at least two thirds of the outstanding voting
securities of the Fund. Therefore, approval of the proposal will not require the
affirmative vote of two thirds of the outstanding voting securities.
Adoption of this proposal would authorize the officers of the Fund to
prepare, execute and file Articles of Amendment and Restatement, as set forth in
Exhibit B herein, to replace Articles FIRST through ELEVENTH of the Fund's
present Articles of Incorporation.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 4
Proposal 5. RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
This proposal will be presented for action at the meeting only if the
investment advisory agreement recommended in Proposal 1 is approved at
the meeting and the nominees identified in Proposal 2 are elected.
At the meeting, the stockholders will be asked to ratify the selection by
the Board of Directors, including a majority of the directors who are not
"interested persons" (as such term is defined in the 1940 Act), of Ernst & Young
LLP, independent auditors, to serve as the Fund's auditors for the year ending
December 31, 1996. Ernst & Young LLP presently serves as independent accountants
for the closed-end funds advised by Quest. Ernst & Young LLP has informed the
Fund that neither Ernst & Young LLP nor any of its partners has any direct or
indirect financial interest in the Fund except as auditors and independent
public accountants. Representatives of Ernst & Young LLP are not expected to be
present at the meeting, but have been given an opportunity to make a statement
if they so desire, and will be available should any matter arise requiring their
participation.
KPMG Peat Marwick has served as the Fund's independent public accountant
from the Fund's inception through the year ended December 31, 1995. While there
is no dispute or disagreement between the Fund and KPMG Peat Marwick, that firm
does not serve as the accountant for any of The Royce Funds. The Board has been
advised by Quest that efficiencies of operation would be expected if the Fund
uses the same accountant as other closed-end Royce Funds, and the Board has
therefore recommended the ratification of Ernst & Young LLP. If this proposal is
not presented, or is not approved, the Board will determine what further action
is required in this regard.
VOTE REQUIRED
Ratification of the selection of Ernst & Young LLP as the independent
public accountants of the Fund requires the affirmative vote of a majority of
the shares of the Fund present and voting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 5.
6. OTHER BUSINESS
Management knows of no business to be brought before the meeting other than
Proposals 1, 2, 3, 4 and 5 in the Notice of the Annual Meeting. If other matters
do come before the meeting, it is intended that the shares represented by
Proxies will be voted in accordance with the judgment of the person or persons
exercising at the meeting the authority conferred by the Proxies.
ADDITIONAL INFORMATION
Fund/Plan Services, Inc., located at 2 West Elm Street, Conshohocken,
Pennsylvania 19428, serves as the Fund's transfer agent, dividend-disbursing
agent and the custodial agent for the Fund's custodian bank.
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the Fund's 1997
Annual Meeting of Stockholders must be received by the Fund by April 30, 1997,
for inclusion in the Fund's Proxy Statement and form of Proxy relating to that
meeting.
PLEASE FILL IN, DATE AND SIGN THE PROXY AND RETURN IT IN THE ACCOMPANYING
POSTAGE-PAID ENVELOPE.
<PAGE>
================================================================================
================================================================================
EXHIBIT A
INVESTMENT ADVISORY AGREEMENT
BETWEEN
ALL SEASONS GLOBAL FUND, INC.
AND
QUEST ADVISORY CORP.
Agreement dated as of ____________, 1996 by and between ALL SEASONS GLOBAL
FUND, INC., a Maryland corporation whose name may be changed to ROYCE GLOBAL
FUND, INC. (the "Fund"), and QUEST ADVISORY CORP., a New York corporation (the
"Adviser").
The Fund and the Adviser hereby agree as follows:
1. Duties of the Adviser. The Adviser shall, during the term and subject to
the provisions of this Agreement, (a) determine the composition of the portfolio
of the Fund, the nature and timing of the changes therein and the manner of
implementing such changes and (b) provide the Fund with such investment
advisory, research and related services as the Fund may, from time to time,
reasonably require for the investment of its assets. The Adviser shall perform
such duties in accordance with the applicable provisions of the Fund's Articles
of Incorporation, By-laws and stated investment objective, policies and
restrictions and any directions it may receive from the Fund's Board of
Directors.
2. Expenses Payable by the Fund. Except as otherwise provided in Paragraphs
1 and 3 hereof, the Fund shall be responsible for determining the net asset
value of its shares and for all of its other operations and shall pay all
administrative and other costs and expenses attributable to its operations and
transactions, including, without limitation, registrar, transfer agent and
custodian fees; legal, administrative and clerical services; rent for its office
space and facilities; auditing; preparation, printing and distribution of its
proxy statements, stockholders' reports and notices; supplies and postage;
Federal and state registration fees; securities market listing fees and
expenses; Federal, state, local and foreign taxes; non-affiliated directors'
fees; interest on its borrowings; brokerage commissions; and the cost of issue,
sale and repurchase of its shares.
3. Expenses Payable by the Adviser. The Adviser shall furnish, without
expense to the Fund, the services of those of its executive officers and
full-time employees who may be duly elected executive officers or directors of
the Fund, subject to their individual consent to serve and to any limitations
imposed by law, and shall pay all the salaries and expenses of such persons. For
purposes of this Agreement, only a president, a treasurer or a vice-president in
charge of a principal business function shall be deemed to be an executive
officer. The Adviser shall also pay all expenses which it may incur in
performing its duties under Paragraph 1 hereof and shall reimburse the Fund for
any space leased by the Fund and occupied by the Adviser.
4. Compensation of the Adviser.
(a) The Fund agrees to pay to the Adviser, and the Adviser agrees to
accept, as compensation for the services provided by the Adviser hereunder, a
monthly fee equal to 1/12 of 1% (1% on an annualized basis) of the average net
assets of the Fund for each month during the term of this Agreement. (The net
assets of the Fund shall be computed by subtracting the amount of any
indebtedness and other liabilities of the Fund from the value of the total
assets of the Fund, and the liquidation preference of and any potential
redemption premium for any preferred stock of the Fund that may hereafter be
issued and outstanding shall not be treated as an indebtedness or other such
liability of the Fund for this purpose.) The Fund shall pay such fee to the
Adviser at or promptly following the end of each such month.
(b) Notwithstanding the provisions of subparagraph (a) above to the
contrary, the Adviser shall reduce the monthly fees payable to it hereunder to
the extent necessary so that the ratio of the expenses of the Fund (including
the fees payable to the Adviser, but excluding interest, dividends on securities
sold short, taxes, brokerage commissions, distribution fees, amortization of
organization expenses and litigation and indemnification expenses and other
extraordinary expenses not incurred in the ordinary course of the Fund's
business) shall not exceed (i) for the period from the date on which this
Agreement shall become effective and ending December 31, 1996, 2.0% of the
Fund's average net assets for such period, and (ii) for each of the fiscal years
of the Fund ending December 31, 1997 and December 31, 1998, 1.75% of the Fund's
average net assets for such fiscal year.
(c) In the event of any termination of this Agreement, the fee provided for
in this Paragraph 4 shall be calculated on the basis of a period ending on the
last day on which this Agreement is in effect, subject to a pro rata adjustment
based on the number of days elapsed in the current month as a percentage of the
total number of days in such month.
5. Excess Brokerage Commissions. The Adviser is hereby authorized, to the
fullest extent now or hereafter permitted by law, to cause the Fund to pay a
member of a national securities exchange, broker or dealer an amount of
commission for effecting a securities transaction in excess of the amount of
commission another member of such exchange, broker or dealer would have charged
for effecting that transaction, if the Adviser determines in good faith that
such amount of commission is reasonable in relation to the value of the
brokerage and/or research services provided by such member, broker or dealer,
viewed in terms of either that particular transaction or its over-all
responsibilities with respect to the Fund and its other accounts.
6. Limitations on the Employment of the Adviser. The services of the
Adviser to the Fund shall not be deemed exclusive, and the Adviser may engage in
any other business or render similar or different services to others so long as
its services to the Fund hereunder are not impaired thereby, and nothing in this
Agreement shall limit or restrict the right of any director, officer or employee
of the Adviser to engage in any other business or to devote his time and
attention in part to any other business, whether of a similar or dissimilar
nature. So long as this Agreement or any extension, renewal or amendment remains
in effect, the Adviser shall be the only investment adviser to the Fund, subject
to the Adviser's right to enter into sub-advisory agreements. The Adviser
assumes no responsibility under this Agreement other than to render the services
called for hereunder, and shall not be responsible for any action of or directed
by the Board of Directors of the Fund, or any committee thereof, unless such
action has been caused by the Adviser's gross negligence, willful malfeasance,
bad faith or reckless disregard of its obligations and duties under this
Agreement.
7. Responsibility of Dual Directors, Officers and/or Employees. If any
person who is a director, officer or employee of the Adviser is or becomes a
director, officer and/or employee of the Fund and acts as such in any business
of the Fund pursuant to this Agreement, then such director, officer and/or
employee of the Adviser shall be deemed to be acting in such capacity solely for
the Fund, and not as a director, officer and/or employee of the Adviser or under
the control or direction of the Adviser, although paid by the Adviser.
8. Protection of the Adviser. The Adviser shall not be liable to the Fund
for any action taken or omitted to be taken by the Adviser in connection with
the performance of any of its duties or obligations under this Agreement or
otherwise as an investment adviser of the Fund, and the Fund shall indemnify the
Adviser and hold it harmless from and against all damages, liabilities, costs
and expenses (including reasonable attorneys' fees and amounts reasonably paid
in settlement) incurred by the Adviser in or by reason of any pending,
threatened or completed action, suit, investigation or other proceeding
(including an action or suit by or in the right of the Fund or its security
holders) arising out of or otherwise based upon any action actually or allegedly
taken or omitted to be taken by the Adviser in connection with the performance
of any of its duties or obligations under this Agreement or otherwise as an
investment adviser of the Fund. Notwithstanding the preceding sentence of this
Paragraph 8 to the contrary, nothing contained herein shall protect or be deemed
to protect the Adviser against or entitle or be deemed to entitle the Adviser to
indemnification in respect of, any liability to which the Adviser would
otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of its reckless
disregard of its duties and obligations under this Agreement.
Determinations of whether and the extent to which the Adviser is entitled
to indemnification hereunder shall be made by reasonable and fair means,
including (a) a final decision on the merits by a court or other body before
whom the action, suit or other proceeding was brought that the Adviser was not
liable by reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of its duties or (b) in the absence of such a decision, a reasonable
determination, based upon a review of the facts, that the Adviser was not liable
by reason of such misconduct by (i) the vote of a majority of a quorum of the
directors of the Fund who are neither "interested persons" of the Fund (as
defined in Section 2(a)(19) of the Investment Company Act of 1940) nor parties
to the action, suit or other proceeding or (ii) an independent legal counsel in
a written opinion.
9. Effectiveness, Duration and Termination of Agreement. This Agreement
shall become effective on _________, 1996, and shall remain in effect until
April 30, 1998 and thereafter shall continue automatically for successive annual
periods from May 1 to April 30, provided that such continuance is specifically
approved at least annually by (a) the vote of the Fund's directors, including a
majority of such directors who are not parties to this Agreement or "interested
persons" (as such term is defined in Section 2(a)(19) of the Investment Company
Act of 1940) of any such party, cast in person at a meeting called for the
purpose of voting on such approval, or (b) the vote of a majority of the
outstanding voting securities of the Fund and the vote of the Fund's directors,
including a majority of such directors who are not parties to this Agreement or
"interested persons" (as so defined) of any such party. This Agreement may be
terminated at any time, without the payment of any penalty, on sixty (60) days'
written notice by the vote of a majority of the outstanding voting securities of
the Fund or by the vote of a majority of the Fund's directors or by the Adviser,
and will automatically terminate in the event of its "assignment" (as such term
is defined for purposes of Section 15(a)(4) of the Investment Company Act of
1940); provided, however, that the provisions of Paragraph 8 of this Agreement
shall remain in full force and effect, and the Adviser shall remain entitled to
the benefits thereof, notwithstanding any such termination.
10. Name. The Fund may, so long as this Agreement remains in effect, use
"Royce" as part of its name. The Adviser may, upon termination of this
Agreement, require the Fund to refrain from using the name "Royce" in any form
or combination in its name or in its business, and the Fund shall, as soon as
practicable following its receipt of any such request from the Adviser, so
refrain from using such name.
11. Notices. Any notice under this Agreement shall be given in writing,
addressed and delivered or mailed, postage prepaid, to the other party at its
principal office.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed the day and year first above written.
ALL SEASONS GLOBAL FUND, INC.
By:_______________________________
QUEST ADVISORY CORP.
By:_______________________________
Charles M. Royce, President
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EXHIBIT B
ALL SEASONS GLOBAL FUND, INC.
ARTICLES OF AMENDMENT AND RESTATEMENT
All Seasons Global Fund, Inc., a Maryland corporation having its principal
Maryland office in the City of Baltimore, State of Maryland (hereinafter called
the "Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland:
FIRST: The Articles of Incorporation of the Corporation are amended and as
so amended are restated in their entirety by striking out Articles FIRST through
ELEVENTH and inserting in lieu thereof the following:
ARTICLE I
NAME
The name of the Corporation is ROYCE GLOBAL TRUST, INC.
ARTICLE II
PURPOSES AND POWERS
The Corporation is formed for the following purposes:
(i) To conduct and carry on the business of an investment company.
(ii) To hold, invest and reinvest its assets in securities and other
investments or to hold part or all of its assets in cash.
(iii) To issue and sell shares of its capital stock in such amounts and on
such terms and conditions and for such purposes and for such amount or kind of
consideration as may now or hereafter be permitted by law.
(iv) To do any and all additional acts and to exercise any and all
additional powers or rights as may be necessary, incidental, appropriate or
desirable for the accomplishment of all or any of the foregoing purposes.
The Corporation shall be authorized to exercise and enjoy all of the
powers, rights and privileges granted to, or conferred upon, corporations by the
Maryland General Corporation Law now or hereafter in force, and the enumeration
of the foregoing shall not be deemed to exclude any powers, rights or privileges
so granted or conferred.
ARTICLE III
PRINCIPAL OFFICE AND RESIDENT AGENT
The post office address of the principal office of the Corporation in the
State of Maryland is 11 East Chase Street, Baltimore, Maryland 21202. The name
of the resident agent of the Corporation in the State of Maryland is Prentice
Hall Corporation System, Maryland. The post office address of the resident agent
is 11 East Chase Street, Baltimore, Maryland 21202.
ARTICLE IV
CAPITAL STOCK
(1) The total number of shares of capital stock that the Corporation shall
have authority to issue is one hundred million (100,000,000) shares, of the par
value of one cent ($.01) per share, and of the aggregate par value of one
million dollars ($1,000,000), all of which one hundred million (100,000,000)
shares are designated Common Stock, subject to the authority granted to the
Board of Directors herein to classify and reclassify stock.
(2) The Corporation may issue fractional shares. Any fractional share shall
carry proportionately the rights of a whole share, including, without
limitation, the right to vote and the right to receive dividends.
(3) All persons who shall acquire stock in the Corporation shall acquire
the same subject to the provisions of these Articles of Incorporation and the
Bylaws of the Corporation.
(4) No holder of stock of the Corporation shall have, by virtue of being
such a holder, any right to purchase or subscribe for any share of the
Corporation's capital stock or any other security that the Corporation may issue
or sell (whether out of the number of shares authorized by these Articles of
Incorporation or out of any shares of the Corporation's capital stock that the
Corporation may acquire) other than a right that the Board of Directors may, in
its discretion, determine to grant.
(5) The Board of Directors shall have authority by resolution to classify
and reclassify any authorized but unissued shares of capital stock from time to
time, whether as common stock or otherwise, by setting or changing in any one or
more respects the preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications or, except to the
extent limited by Articles VI of these Articles, terms or conditions of
redemption of the capital stock.
(6) Notwithstanding any provision of the Maryland General Corporation Law
requiring any action to be taken or authorized by the affirmative vote of the
holders of a greater proportion of the votes of all classes or of any class of
stock of the Corporation, such action shall, except as otherwise provided in
Article VI of these Articles of Incorporation, be effective and valid if taken
or authorized by the affirmative vote of a majority of the total number of votes
entitled to be cast thereon.
ARTICLE V
BOARD OF DIRECTORS
(1) (i) The number of directors of the Corporation shall be no less than
three (3). This number may be changed pursuant to the Bylaws of the Corporation,
but shall at no time be less than the minimum number required under the Maryland
General Corporation Law.
(ii) The Corporation reserves, and grants to the Board of Directors, the
power to modify the structure of the Board of Directors or any voting right of
stockholders with respect thereto, if such action is deemed necessary in order
to comply with requirements of the Investment Company Act of 1940, as amended,
which relate to or result from the issuance of any class of senior security.
(2) In furtherance, and not in limitation, of the powers conferred by the
laws of the State of Maryland, the Board of Directors is expressly authorized to
do the following to the extent consistent with the Maryland General Corporation
Law:
(i) To make, alter or repeal the Bylaws of the Corporation, except where
such power is reserved by the Bylaws to the stockholders and except as otherwise
required by the Investment Company Act of 1940, as amended.
(ii) To determine from time to time whether and to what extent and at what
times and places and under what conditions and regulations the books and
accounts of the Corporation, or any of them other than the stock ledger, shall
be open to the inspection of the stockholders. No stockholder shall have any
right to inspect any account or book or document of the Corporation, except as
conferred by law or authorized by resolution of the Board of Directors.
(iii) Without the assent or vote of the stockholders, to authorize the
issuance from time to time of shares of stock of any class of the Corporation,
whether now or hereafter authorized, and securities convertible into shares of
stock of the Corporation of any class or classes, whether now or hereafter
authorized, and for such consideration as the Board of Directors may deem
advisable.
(iv) Without the assent or vote of the stockholders, to authorize and issue
obligations of the Corporation, secured and unsecured, as the Board of Directors
may determine, and to authorize and cause to be executed mortgages and liens
upon the real or personal property of the Corporation.
(v) Notwithstanding anything in these Articles of Incorporation to the
contrary, to establish, in its absolute discretion, the basis or method for
determining the value of the assets belonging to any class, the value of the
liabilities belonging to any class and the net asset value of each share of any
class of the Corporation's stock.
(vi) To determine, in accordance with generally accepted accounting
principles and practices, what constitutes net profits, earnings, surplus or net
assets in excess of capital, and to determine what accounting periods shall be
used by the Corporation for any purpose; to set apart out of any funds of the
Corporation reserves for such purposes as it shall determine and to abolish the
same; to declare and pay any dividends and distributions in cash, securities or
other property from surplus or any funds legally available therefor, at such
intervals as it shall determine; to declare dividends or distributions by means
of a formula or other method of determination, at meetings held less frequently
than the frequency of the effectiveness of such declarations; to establish
payment dates for dividends or any other distributions on any basis, including
dates occurring less frequently than the effectiveness of declarations thereof;
and to provide for the payment of declared dividends on a date earlier or later
than the specified payment in the case of stockholders of the Corporation
surrendering their entire ownership of shares of any class of stock of the
Corporation for redemption.
(vii) In addition to the powers and authorities granted herein and by
statute expressly conferred upon it, the Board of Directors is authorized to
exercise all powers and do all acts that may be exercised or done by the
Corporation pursuant to the provisions of the laws of the State of Maryland,
these Articles of Incorporation and the Bylaws of the Corporation.
(3) Any determination made in good faith, and in a manner reasonably
believed to be in the best interests of the Corporation, and with the care that
an ordinarily prudent person in a like position would use under similar
circumstances, by or pursuant to the direction of the Board of Directors, with
respect to the amount of assets, obligations or liabilities of the Corporation,
as to the amount of net income of the Corporation from dividends and interest
for any period or amounts at any time legally available for the payment of
dividends, as to the amount of any reserves or charges set up and the propriety
thereof, as to the time of or purpose for creating reserves or as to the use,
alteration or cancellation of any reserves or charges (whether or not any
obligation or liability for which the reserves or charges have been created has
been paid or discharged or is then or thereafter required to be paid or
discharged), as to the value of any security owned by the Corporation, as to the
determination of the net asset value of shares of any class of the Corporation's
capital stock, or as to any other matters relating to the issuance, sale,
repurchase or other acquisition or disposition of securities or shares of
capital stock of the Corporation, and any reasonable determination made in good
faith by the Board of Directors whether any transaction constitutes a purchase
of securities on "margin," a sale of securities "short," or an underwriting or
sale of, or a participation in any underwriting or selling group in connection
with the public distribution of, any securities, shall be final and conclusive,
and shall be binding upon the Corporation and all holders of its capital stock,
past, present and future, and shares of the capital stock of the Corporation are
issued and sold on the condition and understanding, evidenced by the purchase of
shares of capital stock or acceptance of share certificates, that any and all
such determinations shall be binding as aforesaid. No provision of these
Articles of Incorporation of the Corporation shall be effective to (i) require a
waiver of compliance with any provision of the Securities Act of 1933, as
amended, or the Investment Company Act of 1940, as amended, or of any valid
rule, regulation or order of the Securities and Exchange Commission under those
Acts or (ii) protect or purport to protect any director or officer of the
Corporation against any liability to the Corporation or its security holders to
which he would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
his office.
ARTICLE VI
CERTAIN ACTIONS
The stockholders of the Corporation shall have the power by the affirmative
vote of two-thirds of the aggregate number of the votes entitled to be cast
thereon to authorize any of the following actions: (i) the dissolution of the
Corporation; (ii) a merger or consolidation of the Corporation (in which the
Corporation is not the surviving corporation); (iii) the sale, lease, exchange
or other disposal of all or substantially all the property and assets of the
Corporation to any person (as such term is defined in the Investment Company Act
1940); or (iv) any amendment of these Articles of Incorporation which makes any
class of the Corporation's stock redeemable securities (as that term is defined
in the Investment Company Act of 1940) or which reduces the two-thirds approval
required to authorize the above actions.
ARTICLE VII
LIMITATIONS ON LIABILITY
To the fullest extent that limitations on the liability of directors and
officers are permitted by Maryland General Corporation Law (as from time to time
amended) no director or officer of the Corporation shall have any liability to
the Corporation or its stockholders for money damages. This limitation on
liability applies to events occurring at the time a person serves as a director
or officer of the Corporation, whether or not such person is a director or
officer at the time of any proceeding in which liability is asserted. No future
amendment to the Articles of Incorporation of the Corporation shall affect any
right of any person under this Article VII based on any event, omission or
proceeding prior to such amendment.
ARTICLE VIII
AMENDMENTS
The Corporation reserves the right from time to time to make any amendment
to its Charter, now or hereafter authorized by law, including any amendment that
alters the contract rights, as expressly set forth in the Charter, of any
outstanding stock.
SECOND: The Corporation desires to amend and restate its Charter as
currently in effect. The provisions set forth in these Articles of Amendment and
Restatement are all the provisions of the Charter currently in effect upon these
Articles of Amendment and Restatement becoming effective. The current address of
the principal Maryland office of the Corporation, the name and address of the
Corporation's current resident agent and the number of directors of the
Corporation and the names of those currently in office are as set forth herein.
THIRD: The amendment and restatement of the Charter of the Corporation as
hereinabove set forth has been duly approved by a majority of the entire board
of directors and by the affirmative vote of the holders of a majority of the
issued and outstanding capital stock of the Corporation.
IN WITNESS WHEREOF, All Seasons Global Fund, Inc. has caused these Articles
of Amendment and Restatement to be signed in its name and on its behalf by
________________, its President, and witnessed by ___________________, its
Secretary, on ________, 1996.
The ___________________ President acknowledges these Articles of Amendment
and Restatement to be the corporate act of the Corporation and states that to
the best of his knowledge, information and belief, the matters and facts set
forth in these Articles with respect to the authorization and approval of the
Amendment and Restatement of the Corporation's Articles of Incorporation are
true in all material respects, and that this statement is made under penalties
of perjury.
By:____________________________________
___________________________President
WITNESS:____________________________
___________________Secretary
<PAGE>
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Proxy All Seasons Global Fund, Inc. Proxy
250 Park Avenue South, Suite 200
Winter Park, Florida 32789
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
THE UNDERSIGNED HEREBY APPOINTS DIEGO J. VEITIA AND STEPHEN A. SAKER, AS
PROXIES, EACH WITH THE POWER TO APPOINT HIS SUBSTITUTE, AND HEREBY AUTHORIZES
THEM, OR ANY OF THEM, TO REPRESENT AND VOTE ALL THE SHARES OF COMMON STOCK OF
ALL SEASONS GLOBAL FUND, INC. HELD OF RECORD BY THE UNDERSIGNED ON JULY 15, 1996
AT THE ANNUAL MEETING OF STOCKHOLDERS ON AUGUST 29, 1996, OR ANY ADJOURNMENT
THEREOF:
2. On the ELECTION OF FOUR DIRECTORS _______FOR all nominees listed
(except as marked to the contrary below)
_______WITHHOLD AUTHORITY to vote for all nominees listed below
Charles M. Royce Richard M. Galkin Stephen L. Isaacs David L. Meister
(To withhold authority to vote for any individual nominee, place a line through
the nominee's name.)
3. To approve a change in the Fund's fundamental investment objective as set
forth in the Proxy Statement.
____________FOR __________AGAINST____________ABSTAIN
<PAGE>
4. To approve Amended and Restated Articles of Incorporation for the Fund.
__________FOR __________AGAINST____________ABSTAIN
5. To ratify the selection of Ernst & Young LLP as auditors for the year ending
December 31, 1996.
__________FOR __________AGAINST____________ABSTAIN
6. In their discretion, upon the transaction of any other matters which may
properly come before the meeting or any adjournment thereof.
The shares represented by this proxy, when properly executed, will be voted as
specified in the foregoing Proposals 1, 2, 3, 4 and 5 by the undersigned
stockholder(s). If no direction is made, this proxy will be voted FOR the
approval of the new Investment Advisory Agreement; FOR the election of the four
nominees named in the proxy statement; FOR the approval of a change in the
Fund's investment objective; FOR the approval of Amended and Restated Articles
of Incorporation; and FOR ratification of the selection of Ernst & Young, LLP
and, in the discretion of management, as to any other matter which may come
before the meeting.
_____________________________________________________
_____________________________________________________
Signature(s) of Stockholder (s)
Dated_____________________________, 1996
Please sign exactly as name(s) appear. 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 the
corporate name by the President or other authorized officer. If a partnership,
please sign in the partnership name by an authorized person..
