About EDGAR Online | Login
 
Enter your Email for a Free Trial:
The following is an excerpt from a DEF 14A SEC Filing, filed by BARON ASSET FUND on 9/20/2004.
Next Section Next Section Previous Section Previous Section
BARON INVESTMENT FUNDS TRUST (F/K/A BARON ASSET FUND) - DEF 14A - 20040920 - NOTICE_OF_SPECIAL_MEETING
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

To Our Shareholders:

Please take notice that a Special Meeting of Shareholders (the "Meeting") of Baron Asset Fund, Baron Growth Fund, Baron Small Cap Fund, Baron iOpportunity Fund and Baron Fifth Avenue Growth Fund, (each a "Fund", collectively "Funds") each of which is a separate series of Baron Asset Fund, a Massachusetts business trust (the "Trust"), will be held at Avery Fisher Hall, Lincoln Center, 10 Lincoln Center Plaza, New York, NY 10023 on October 22, 2004 at 1:00 p.m. eastern time.

The shareholders of ALL FIVE FUNDS will be asked to consider and vote together as a single class on the following proposal, which is described in the accompanying proxy statement:

(1) Election of ten members of the Board of Trustees of the Trust.

The shareholders of ALL FIVE FUNDS of the Trust will be asked to consider and vote together as a single class on the following proposal, which is described in the accompanying proxy statement:

(2) Change the name of the Baron Asset Fund Trust to Baron Investment Funds Trust

The shareholders of the BARON ASSET FUND SERIES will be asked to consider and vote on the additional following proposal, which is described in the accompanying proxy statement:

(3) To eliminate the fundamental investment restrictions of the Fund and replace them with an updated set of fundamental restrictions.

The shareholders of EACH FUND will be asked to consider and vote separately on the following proposal, which is described in the accompanying proxy statement:

(4) To transact such other business as may properly come before the Special Meeting of Shareholders or any adjournment thereof.

Only holders of record of shares of common stock of the Fund at the close of business on September 8, 2004, are entitled to vote at the Meeting and at any adjournments thereof.

1

In the event that the necessary quorum to transact business, or if the vote required to approve a proposal is not obtained at the Meeting, the persons named on the proxy card as proxies may propose one or more adjournments of the Meeting, in accordance with applicable law, to permit further solicitation of proxies. Any such adjournment will require the affirmative vote of the holders of a majority of the Fund's shares present in person or by proxy at the Meeting. The persons named as proxies will vote in favor of such adjournment those proxies which they are entitled to vote in favor of the proposal and will vote against any such adjournment those proxies to be voted against the proposal.

By order of the Board of Trustees,

                                       /s/ Linda S. Martinson
                                           Linda S. Martinson
                                           Secretary

September 1, 2004

2

IMPORTANT

Your vote is important and, as a shareholder, you are asked to be at the Meeting either in person or by proxy. If you are unable to attend the meeting in person we urge you to vote by proxy in case you may not be able to attend in person since you can always revoke your proxy at the meeting. You can do this by:

1. Completing, signing, dating and promptly returning the enclosed proxy card using the enclosed postage prepaid envelope;

2. Calling the toll-free number on your proxy card; or

3. Voting at the Internet web site on your proxy card.

YOUR PROMPT VOTING BY PROXY MAY SAVE THE NECESSITY AND EXPENSE OF FURTHER SOLICITATIONS TO ENSURE A QUORUM AT THE MEETING. VOTING BY PROXY WILL NOT PREVENT YOU FROM PERSONALLY VOTING YOUR SHARES AT THE MEETING AND YOU MAY REVOKE YOUR PROXY BY ADVISING THE SECRETARY OF THE TRUST IN WRITING (BY SUBSEQUENT PROXY OR THROUGH THE WEB SITE) OR BY TELEPHONE OF SUCH REVOCATION AT ANY TIME BEFORE THE MEETING.

3

BARON ASSET FUND
BARON GROWTH FUND
BARON SMALL CAP FUND
BARON iOPPORTUNITY FUND
BARON FIFTH AVENUE GROWTH FUND

767 Fifth Avenue, 49th Floor
New York, NY 10153


PROXY STATEMENT

GENERAL

This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Trustees (the "Board") of Baron Asset Fund (the "Trust"), on behalf of its series, BARON ASSET FUND, BARON GROWTH FUND, BARON SMALL CAP FUND, BARON iOPPORTUNITY FUND and BARON FIFTH AVENUE GROWTH FUND. This proxy statement is for use at Special Meeting of Shareholders (the "Meeting"), to be held at Avery Fisher Hall, Lincoln Center, 10 Lincoln Center Plaza, New York, NY 10023 on October 22, 2004 at 1:00 p.m., eastern time, and at any and all adjournments thereof.

This Proxy Statement, the Notice of Special Meeting and the proxy cards are first being mailed to shareholders on or about September 15, 2004, or as soon as practicable thereafter. Any shareholder giving a proxy has the power to revoke it in person at the Meeting, by mail (addressed to the Secretary at the principal office of the Funds, 767 Fifth Avenue, 49th floor, New York, NY 10153), by visiting the Internet website on your proxy card, calling the toll-free number on your proxy card, by executing a superseding proxy, or by submitting a notice of revocation to the Funds. All properly executed proxies received in time for the Meeting will be voted as specified in the Proxy Statement.

A majority of the outstanding shares must be present in person or by proxy to constitute a quorum for the transaction of business. If the necessary quorum to transact business or the vote required to approve the proposal is not obtained at the Meeting, the persons named as proxies on the proxy card may propose one or more adjournments of the Meeting, in accordance with applicable law, to permit the further solicitation of proxies. Any such adjournment would require the affirmative vote of a majority of the shares voting on the adjournment. The persons named as proxies will vote in favor of such adjournment those proxies which they are entitled to vote in favor of the proposal, and will vote against any such adjournment those proxies that they have been instructed to vote against the proposal. For purposes of determining the presence of a quorum for the Meeting, abstentions will be treated as shares that are

4

present but which have not been voted. Brokers and other nominees may not be eligible to vote on certain matters shares that are not beneficially owned by them and as to which they have not received voting instructions; and accordingly these "broker non-votes" will be disregarded for quorum and voting purposes on such matters. SHAREHOLDERS ARE URGED TO FORWARD THEIR VOTING INSTRUCTIONS PROMPTLY.

The Annual Financial Report for the Funds of the Trust for the year ended September 30, 2003, was mailed to shareholders the last week in November, 2003. The unaudited Semi-Annual Financial Report for the Funds of the Trust was mailed to shareholders in May of 2004. Both of these reports are available on the website of the Securities and Exchange Commission, www.sec.gov, under the name Baron Asset Fund. Copies are also available free of charge by calling 1.800.992.2766.

PROPOSALS

SUMMARY

The following table summarizes the proposals being submitted by the Board of Trustees for action at the October 22, 2004 Special Meeting of Shareholders (the "Meeting").

PROPOSALS                                 FUNDS AFFECTED
---------                                 --------------

    1. Elect ten Board members            Baron Asset Fund series
                                          Baron Growth Fund series
                                          Baron Small Cap Fund series
                                          Baron iOpportunity Fund series
                                          Baron Fifth Avenue Growth Fund series

    2. Change name of Trust               Baron Asset Fund series
                                          Baron Growth Fund series
                                          Baron Small Cap Fund series
                                          Baron iOpportunity Fund series
                                          Baron Fifth Avenue Growth Fund series

    3. Change investment restrictions     Baron Asset Fund series

Trustees will be elected by plurality vote, with the nominees receiving the most votes being elected. The change in the name of the Trust requires the affirmative vote by a majority of the shares present and voting on the proposal, and the change in investment restrictions of the Baron Asset Fund series requires the affirmative vote of the lesser of: (a) 67% of the Baron Asset Fund series' shares present at the Meeting if more than 50% of such shares outstanding on the record date are present in person or by proxy or (b) more than 50% of the shares of the Baron Asset Fund series' shares outstanding on the record date.

5

Holders of record of the shares of the Funds at the close of business on September 8, 2004, (the "Record Date") will be entitled to one vote per share for each Fund on all business relevant to that Fund to be conducted at the Meeting.

PROPOSAL 1 asks shareholders of all five Funds to elect ten Board members to the Board of Trustees. It is intended that the enclosed proxy will be voted for the nominees listed below unless such authority has been withheld in the proxy. Except for Mr. Dodge and Mr. Fuente, all nominees named below are currently Trustees and have served in that capacity for many years as indicated below. Mr. Dodge and Mr. Fuente are nominated to fill vacancies. Mr. Dodge and Mr. Fuente, as well as five other trustees, are independent. Three trustees are "interested". Each of the current Trustees oversees the five Funds of the Trust. Charles N. Mathewson, an independent trustee, was elected to serve as Baron Funds' chairman on August 3, 2004.

The Board of Trustees held four regular quarterly meeting during the fiscal year that ended September 30, 2003. In addition, it held one special meeting.

The Board of Trustees has established four committees, i.e., Audit, Executive, Nominating and Independent. There are two members of the Audit Committee, Norman S. Edelcup, and Raymond Noveck, both Non-Interested Trustees. The Board has determined that they have at least one independent Audit Committee financial expert. The Audit Committee recommends to the full Board the engagement or discharge of the Funds' independent accountants; directs investigations into matters within the scope of the independent accountants' duties; reviews with the independent accountants the results of the audits; and reviews the independence of the independent accountants. For the fiscal year ended September 30, 2003, each member of the Audit Committee received an aggregate of $2,500 in annual compensation for serving on the Audit Committee. The Audit Committee met twice during the fiscal year ended September 30, 2003.

There are three members of the Executive Committee which is empowered to exercise all of the powers, including the power to declare dividends, of the full Board of Trustees when the full Board of Trustees is not in session. The members of the Executive Committee are Ronald Baron, Morty Schaja and Linda S. Martinson, all of whom serve on the committee without compensation. Mr. Baron, Mr. Schaja and Ms. Martinson are Interested Trustees. There were four meetings of the Executive Committee during the fiscal year ended September 30, 2003.

There are five members of the Nominating Committee, Norman S. Edelcup, Charles N. Mathewson, Harold W. Milner, Raymond Noveck and Dr. David A. Silverman, all of whom are Non-Interested Trustees and who serve without compensation. The Nominating Committee does not have a formal charter. There were no meetings of the Nominating Committee during the fiscal year ended September 30, 2003.

The Nominating Committee recommends to the full Board those persons to be nominated for election as Trustees by shareholders and selects and proposes

6

nominees for election by Trustees between shareholder meetings. The Nominating Committee does not normally consider candidates proposed by shareholders for election as Trustees. It does not consider trustee candidates recommended by security holders because the Board believes that the Committee itself can more efficiently find qualified candidates for consideration. The Committee gathers a list of prospective candidates. The Committee generally requires that any candidate be a highly experienced, knowledgeable individual with experience either in the industry or as directors or senior executives of public companies. The Committee does consider candidates recommended by current Trustees, including Interested Trustees. The Committee meets privately with all candidates, questions references, and gathers background information some of which may be from independent sources. The Committee then meets to consider the potential nominees and votes to make a nomination. Mr. Dodge and Mr. Fuente were recommended to the Committee by Ronald Baron, the Trust's president, the Adviser's chief executive officer and an Interested Trustee, and were approved by the Nominating Committee.

There are five members of the Independent Committee, all of whom serve on the Committee without compensation. The members of the Independent Committee are Norman S. Edelcup, Charles N. Mathewson, Harold W. Milner, Raymond Noveck and Dr. David A. Silverman, all who are Non-Interested Trustees. The Committee discusses various Fund matters, including the advisory contract and distribution plan. This Committee met two times during the fiscal year ended September 30, 2003.

Fund shareholders who wish to send communications to the Board may do so by sending e-mail to trustees@BaronFunds.com, which e-mail will be promptly forwarded to each Board member. However, the Secretary reserves the right not to forward to the Trustees any abusive, threatening or otherwise inappropriate materials.

7

1. NOMINEES FOR BOARDS OF TRUSTEES

                                                                                                    NUMBER OF
                                                                                                   PORTFOLIOS IN      OTHER
                                            TERM OF OFFICE                                        FUND COMPLEX      DIRECTORSHIPS
                             POSITION(S)    AND LENGTH OF        PRINCIPAL OCCUPATION(S)           OVERSEEN BY     HELD BY TRUSTEE
NAME, ADDRESS & AGE          WITH FUNDS      TIME SERVED         DURING PAST FIVE YEARS             TRUSTEE         OR NOMINEE
-------------------         -----------    --------------      -----------------------            -------------   -----------------
INTERESTED:
Ronald Baron                President,     The term of         Chairman, CEO, and Director,         All (7)       None outside the
767 Fifth Avenue, 49th fl   CEO, Chief     service is until    Baron Capital, Inc. (1982-Present);                Baron Funds
New York, NY 10153          Investment     cessation; the      Baron Capital Management, Inc.                     Complex.
Age: 61                     Officer,       length of time      (1983-Present); Baron Capital
                            Portfolio      served as Trustee   Group, Inc. (1984-Present);
                            Manager        is 16 years.        BAMCO, Inc. (1987-Present);
                            and Trustee                        Fund (1987-Present); Portfolio
                                                               Manager, Baron Growth Fund
                                                               (1995-Present); President (2004-
                                                               Present), Chairman (1999-2004),
                                                               CIO and Trustee (1987-Present), the
                                                               Trust; President (2004-Present),
                                                               Chairman (1997-2004), CIO and
                                                               Trustee (1997-Present), Baron
                                                               Capital Funds Trust; President
                                                               (2004-Present), Chairman (2003-
                                                               2004), CIO and Trustee (2003-
                                                               Present), Baron Select Funds.

                                       8

                                                                                                    NUMBER OF
                                                                                                   PORTFOLIOS IN      OTHER
                                            TERM OF OFFICE                                        FUND COMPLEX      DIRECTORSHIPS
                             POSITION(S)    AND LENGTH OF        PRINCIPAL OCCUPATION(S)           OVERSEEN BY     HELD BY TRUSTEE
NAME, ADDRESS & AGE          WITH FUNDS      TIME SERVED         DURING PAST FIVE YEARS             TRUSTEE         OR NOMINEE
-------------------         -----------    --------------      -----------------------            -------------   -----------------

INTERESTED:
Linda S. Martinson          Vice           The term of         General Counsel, Vice President &      All (7)     None outside the
767 Fifth Avenue, 49th fl   President,     service is until    Secretary, Baron Capital, Inc.                     Baron Funds
New York, NY 10153          Secretary,     cessation; the      (1983-Present); BAMCO, Inc.                        Complex.
Age: 49                     General        length of time      (1987-Present); Baron Capital
                            Counsel        served as Trustee   Group, Inc. (1984-Present); Baron
                            and Trustee    is 16 years.        Capital Management, Inc. (1983-
                                                               Present); Vice President, Secretary,
                                                               General Counsel and Trustee, the
                                                               Trust (1987-Present); Vice
                                                               President, Secretary, General
                                                               Counsel and Trustee, Baron Capital
                                                               Funds Trust (1997-Present); Vice
                                                               President, General Counsel,
                                                               Secretary and Trustee, Baron Select
                                                               Funds (2003-Present).

                                       9

                                                                                                    NUMBER OF
                                                                                                   PORTFOLIOS IN      OTHER
                                            TERM OF OFFICE                                        FUND COMPLEX      DIRECTORSHIPS
                             POSITION(S)    AND LENGTH OF        PRINCIPAL OCCUPATION(S)           OVERSEEN BY     HELD BY TRUSTEE
NAME, ADDRESS & AGE          WITH FUNDS      TIME SERVED         DURING PAST FIVE YEARS             TRUSTEE         OR NOMINEE
-------------------         -----------    --------------      -----------------------            -------------   -----------------

INTERESTED:
Morty Schaja                Executive      The term of         President and Chief Operating          All (7)     None outside the
767 Fifth Avenue, 49th fl   Vice           service is until    Officer, Baron Capital, Inc. (1999-                Baron Funds
New York, NY 10153          President,     cessation; the      Present); Senior Vice President and                Complex.
Age: 49                     Chief          length of time      Chief Operating Officer, Baron
                            Operating      served as Trustee   Capital, Inc. (1997-1999); Managing
                            Officer and    is 6 years.         Director, Vice President, Baron
                            Trustee                            Capital, Inc. (1991-1999); Director,
                                                               Baron Capital Group, Inc., Baron
                                                               Capital Management, Inc., and
                                                               BAMCO, Inc. (1997-Present);
                                                               Executive Vice President (2004-
                                                               Present), President (1999-2004)
                                                               COO (1999-Present), and Trustee
                                                               (1996-Present), Baron Asset Fund;
                                                               Executive Vice President (2004-
                                                               Present), President (1999-2004)
                                                               COO (1999-Present), and Trustee
                                                               (1997-Present), Baron Capital Funds
                                                               Trust; Executive Vice President
                                                               (2004-Present), President (1999-
                                                               2004), COO (1999-Present) and
                                                               Trustee (2003-Present) Baron Select
                                                               Funds.

                                      10

                                                                                                    NUMBER OF
                                                                                                   PORTFOLIOS IN      OTHER
                                            TERM OF OFFICE                                        FUND COMPLEX      DIRECTORSHIPS
                             POSITION(S)    AND LENGTH OF        PRINCIPAL OCCUPATION(S)           OVERSEEN BY     HELD BY TRUSTEE
NAME, ADDRESS & AGE          WITH FUNDS      TIME SERVED         DURING PAST FIVE YEARS             TRUSTEE         OR NOMINEE
-------------------         -----------    --------------      -----------------------            -------------   -----------------

NON-INTERESTED:
Steven B. Dodge             Nominee        Term of service is  CEO, Windover Development               N/A        Chairman of the
239 Summer Street                          until cessation.    Corporation (2004-Present)(private      (0)        Audit Committee,
Manchester, MA 01944                                           real estate development company);                  Member of
Age: 59                                                        Founder and Chairman, American                     Executive and
                                                               Tower Corporation (1998-2004);                     Special
                                                               Founder, Chairman and CEO,                         Independent
                                                               American Radio Systems (1988-                      Committees,
                                                               1998); Founder, Chairman and                       Sotheby's
                                                               CEO, American Cablesystems                         Holdings, Inc.
                                                               (1978-1988); Chairman of the Audit                 (2000-Present);
                                                               Committee, Member of Executive                     Chairman of
                                                               and Special Independent                            Audit Committee
                                                               Committees, Sotheby's Holdings,                    (2000-2004),
                                                               Inc. (2000-Present); Chairman of                   Member of the
                                                               Audit Committee (2000-2004),                       Audit Committee
                                                               Member of the Audit Committee                      (2000-Present)
                                                               (2000-Present) Nextel Partners, Inc.               Nextel Partners,
                                                                                                                  Inc.

                                      11

                                                                                                    NUMBER OF
                                                                                                   PORTFOLIOS IN      OTHER
                                            TERM OF OFFICE                                        FUND COMPLEX      DIRECTORSHIPS
                             POSITION(S)    AND LENGTH OF        PRINCIPAL OCCUPATION(S)           OVERSEEN BY     HELD BY TRUSTEE
NAME, ADDRESS & AGE          WITH FUNDS      TIME SERVED         DURING PAST FIVE YEARS             TRUSTEE         OR NOMINEE
-------------------         -----------    --------------      -----------------------            -------------   -----------------

NON-INTERESTED:
Norman S. Edelcup           Trustee        The term of         Senior Vice President & Director,       All        Director, Florida
244 Atlantic Isles                         service is until    Florida Savings Bancorp (2001-          (7)        Savings Bancorp
Sunny Isles Beach,                         cessation; the      Present); Mayor (October 2003-                     (2001-Present);
FL 33160                                   length of time      Present), Commissioner, Sunny Isles                Director, Valhi,
Age: 69                                    served as Trustee   Beach, Florida (2001-2003); Senior                 Inc. (1975-
                                           is 16 years.        Vice President, Item Processing of                 Present).
                                                               America (1999-2000) (a subsidiary
                                                               of The Intercept Group); Chairman,
                                                               Item Processing of America (1989-
                                                               1999) (a financial institution service
                                                               bureau); Director, Valhi, Inc. (1975-
                                                               Present) (diversified company);
                                                               Director, Artistic Greetings, Inc.
                                                               (1985-1998); Trustee (1987-
                                                               Present), Baron Asset Fund; Trustee
                                                               (1997-Present), Baron Capital Funds
                                                               Trust; Trustee (2003-Present), Baron
                                                               Select Funds.

                                      12

                                                                                                    NUMBER OF
                                                                                                   PORTFOLIOS IN      OTHER
                                            TERM OF OFFICE                                        FUND COMPLEX      DIRECTORSHIPS
                             POSITION(S)    AND LENGTH OF        PRINCIPAL OCCUPATION(S)           OVERSEEN BY     HELD BY TRUSTEE
NAME, ADDRESS & AGE          WITH FUNDS      TIME SERVED         DURING PAST FIVE YEARS             TRUSTEE         OR NOMINEE
-------------------         -----------    --------------      -----------------------            -------------   -----------------

NON-INTERESTED:
David I. Fuente             Nominee        Term of service is  Director, (1987-Present), Chairman,     N/A        Director, (1987-
701 Tern Point Circle                      until cessation.    (1987-2002), and CEO (1987-2000)        (0)        Present),
Boca Raton, FL 33431                                           Office Depot; Director, Ryder                      Chairman, (1987-
Age: 58                                                        System, Inc. (1998-Present);                       2002), and CEO
                                                               Director, Dick's Sporting Goods,                   (1987-2000)
                                                               Inc. (1993-Present).                               Office Depot;
                                                                                                                  Director, Ryder
                                                                                                                  System, Inc.
                                                                                                                  (1998-Present);
                                                                                                                  Director, Dick's
                                                                                                                  Sporting Goods,
                                                                                                                  Inc. (1993-
                                                                                                                  Present).

                                      13

                                                                                                    NUMBER OF
                                                                                                   PORTFOLIOS IN      OTHER
                                            TERM OF OFFICE                                        FUND COMPLEX      DIRECTORSHIPS
                             POSITION(S)    AND LENGTH OF        PRINCIPAL OCCUPATION(S)           OVERSEEN BY     HELD BY TRUSTEE
NAME, ADDRESS & AGE          WITH FUNDS      TIME SERVED         DURING PAST FIVE YEARS             TRUSTEE         OR NOMINEE
-------------------         -----------    --------------      -----------------------            -------------   -----------------

NON-INTERESTED:
Charles N. Mathewson        Chairman       Term of service is  Chairman Emeritus (October 2003-        All        Chairman
9295 Prototype Road                        until cessation;    Present), Chairman (1986-2003),         (7)        Emeritus (October
Reno, NV 89521                             the length of time  International Game Technology, Inc.                2003-Present),
Age: 76                                    served as           (manufacturer of microprocessor-                   Chairman (1986-
                                           Chairman is since   controlled gaming machines and                     2003), Inter-
                                           08/04 and as        monitoring systems); Chairman,                     national Game
                                           Trustee is 16       American Gaming Association                        Technology, Inc.
                                           years.              (1994-2002); Chairman (2004-                       (manufacturer of
                                                               Present) and Trustee (1987-Present),               microprocessor-
                                                               Baron Asset Fund; Chairman (2004-                  controlled gaming
                                                               Present) and Trustee (1997-Present),               machines and
                                                               Baron Capital Funds Trust;                         monitoring
                                                               Chairman (2004-Present) and                        systems);
                                                               Trustee (2003-Present), Baron                      Chairman,
                                                               Select Funds.                                      American Gaming
                                                                                                                  Association
                                                                                                                  (1994-2002).

                                      14

                                                                                                    NUMBER OF
                                                                                                   PORTFOLIOS IN      OTHER
                                            TERM OF OFFICE                                        FUND COMPLEX      DIRECTORSHIPS
                             POSITION(S)    AND LENGTH OF        PRINCIPAL OCCUPATION(S)           OVERSEEN BY     HELD BY TRUSTEE
NAME, ADDRESS & AGE          WITH FUNDS      TIME SERVED         DURING PAST FIVE YEARS             TRUSTEE         OR NOMINEE
-------------------         -----------    --------------      -----------------------            -------------   -----------------

NON-INTERESTED:
Harold W. Milner            Trustee        Term of service is  Retired; President and CEO, Kahler      All        None outside the
2293 Morningstar Drive                     until cessation;    Realty Corporation (1985-1997)          (7)        Baron Funds
Park City, UT 84060                        the length of time  (hotel ownership and management);                  Complex.
Age: 69                                    served as Trustee   Trustee (1987-Present), Baron Asset
                                           is 16 years.        Fund; Trustee (1997-Present), Baron
                                                               Capital Funds Trust; Trustee (2003-
                                                               Present), Baron Select Funds.

Raymond Noveck              Trustee        Term of service is  Private Investor (1999-Present);        All        None outside the
31 Karen Road                              until cessation;    President, The Medical Information      (7)        Baron Funds
Waban, MA 02168                            the length of time  Line, Inc. (1997-1998) (health care                Complex.
Age: 61                                    served as Trustee   information); President, Strategic
                                           is 16 years.        Systems, Inc. (1990-1997) (health
                                                               care information); Director,
                                                               Horizon/CMS Healthcare
                                                               Corporation (1987-1997); Trustee
                                                               (1987-Present), Baron Asset Fund;
                                                               Trustee (1997-Present), Baron
                                                               Capital Funds Trust; Trustee (2003-
                                                               Present), Baron Select Funds.

                                      15

                                                                                                    NUMBER OF
                                                                                                   PORTFOLIOS IN      OTHER
                                            TERM OF OFFICE                                        FUND COMPLEX      DIRECTORSHIPS
                             POSITION(S)    AND LENGTH OF        PRINCIPAL OCCUPATION(S)           OVERSEEN BY     HELD BY TRUSTEE
NAME, ADDRESS & AGE          WITH FUNDS      TIME SERVED         DURING PAST FIVE YEARS             TRUSTEE         OR NOMINEE
-------------------         -----------    --------------      -----------------------            -------------   -----------------

NON-INTERESTED:
David A. Silverman, MD      Trustee        Term of service is  Physician and Faculty, New York         All        None outside the
146 Central Park West                      until cessation;    University School of Medicine           (7)        Baron Funds
New York, NY 10024                         the length of time  (1976-Present); Trustee (1987-                     Complex.
Age: 54                                    served as Trustee   Present), Baron Asset Fund; Trustee
                                           is 16 years.        (1997-Present), Baron Capital Funds
                                                               Trust; Trustee (2003-Present), Baron
                                                               Select Funds.

16

The following table shows the dollar range of shares beneficially owned by each Trustee as of July 31, 2004:

                                                                                                        AGGREGATE DOLLAR
                                                                                                         RANGE OF EQUITY
                                                      DOLLAR RANGE OF EQUITY                            SECURITIES IN ALL
                                                     SECURITIES IN THE FUNDS                          REGISTERED INVESTMENT
                             -----------------------------------------------------------------------  COMPANIES OVERSEEN BY
                                 BARON        BARON       BARON         BARON            BARON        TRUSTEE IN FAMILY OF
NAME OF TRUSTEE OR NOMINEE       ASSET       GROWTH     SMALL CAP   iOPPORTUNITY   FIFTH AVE GROWTH   INVESTMENT COMPANIES
-----------------------------------------------------------------------------------------------------------------------------------
Interested:
Ronald Baron^                >$100,000    >$100,000    >$100,000    >$100,000          >$100,000            >$100,000
-----------------------------------------------------------------------------------------------------------------------------------
                             $ 10,001-    $ 50,000-    $ 50,000-                      $  10,001-
Linda S. Martinson           $  50,000    $ 100,000    $ 100,000       $0             $   50,000            >$100,000
-----------------------------------------------------------------------------------------------------------------------------------
Morty Schaja*                >$100,000    >$100,000    >$100,000    >$100,000          >$100,000            >$100,000
-----------------------------------------------------------------------------------------------------------------------------------
Non-Interested:
                             $ 50,000-    $ 10,001-    $ 10,001-
Norman Edelcup               $ 100,000    $  50,000    $  50,000   $1-$10,000         $1-$10,000            >$100,000
-----------------------------------------------------------------------------------------------------------------------------------
                             $ 10,001-    $ 10,001-
Charles Mathewson            $  50,000    $  50,000        $0          $0              >$100,000            >$100,000
-----------------------------------------------------------------------------------------------------------------------------------
                                          $ 50,000-    $ 10,001-   $  10,001-         $  10,001-
Harold Milner                >$100,000    $100,000     $ 50,000    $  50,000          $  50,000            >$100,000
-----------------------------------------------------------------------------------------------------------------------------------
                                          $ 10,001-    $ 10,001-                      $  10,001-
Raymond Noveck               >$100,000    $ 50,000     $  50,000       $0             $  50,000            >$100,000
-----------------------------------------------------------------------------------------------------------------------------------
                             $ 10,001-                                                                      $ 10,001-
David Silverman, MD          $ 50,000        $0           $0          $0                 $0                 $ 50,000
-----------------------------------------------------------------------------------------------------------------------------------
Steven B. Dodge                  $0           $0           $0          $0                 $0                    $0
-----------------------------------------------------------------------------------------------------------------------------------
                             $ 50,001-
David I. Fuente              $ 100,000        $0           $0          $0                 $0                    $0
-----------------------------------------------------------------------------------------------------------------------------------

^ Ronald Baron, the chairman and chief executive officer of BAMCO, Inc., the Adviser to the Funds, owns beneficially in excess of $90 million of registered investment companies managed by BAMCO.

* Morty Schaja, the president of BAMCO, Inc., the Adviser to the Funds, owns beneficially in excess of $4 million of registered investment companies managed by BAMCO.

17

The officers of the Trust received no compensation from the Trust for the fiscal year ended September 30, 2003. The Trustees of the Funds received the following compensation from the Funds for the fiscal year ended September 30, 2003:

                                               Pension or                               Total
                                               Retirement          Estimated         Compensation
                           Aggregate            Benefits             Annual         From Fund and
                         Compensation       Accrued as Part      Benefits Upon       Fund Complex
Name                    From the Funds     of Funds Expenses       Retirement      Paid to Trustees
---------------------------------------------------------------------------------------------------
Interested:
Ronald Baron                $     0       N/A                   N/A                    $     0
---------------------------------------------------------------------------------------------------
Linda S. Martinson          $     0       N/A                   N/A                    $     0
---------------------------------------------------------------------------------------------------
Morty Schaja                $     0       N/A                   N/A                    $     0
---------------------------------------------------------------------------------------------------
Non-Interested:
Norman Edelcup              $16,250       N/A                   N/A                    $16,250
---------------------------------------------------------------------------------------------------
Charles Mathewson           $ 6,250       N/A                   N/A                    $ 6,250
---------------------------------------------------------------------------------------------------
Harold Milner               $13,750       N/A                   N/A                    $13,750
---------------------------------------------------------------------------------------------------
Raymond Noveck              $15,625       N/A                   N/A                    $15,625
---------------------------------------------------------------------------------------------------
David Silverman             $13,750       N/A                   N/A                    $13,750
---------------------------------------------------------------------------------------------------
Steven B. Dodge               N/A         N/A                   N/A                      N/A
---------------------------------------------------------------------------------------------------
David I. Fuente               N/A         N/A                   N/A                      N/A
---------------------------------------------------------------------------------------------------

BOARD OF TRUSTEES RECOMMENDATION

The Board of Trustees of the Trust recommends that each nominee listed above be elected to serve as a trustee until he or she ceases to be a trustee
(including upon election of a successor at a meeting of shareholders.)

REQUIRED VOTE

Election of individual Trustees requires an affirmative vote of a plurality of all shares voting if a quorum is present. THE BOARD OF TRUSTEES RECOMMENDS THAT THE SHAREHOLDERS OF THE FUND VOTE IN FAVOR OF EACH NOMINEE.

PROPOSAL 2 asks shareholders of Baron Asset Fund, Baron Growth Fund, Baron Small Cap Fund, Baron iOpportunity Fund and Baron Fifth Avenue Growth Fund to change the name of the Trust from Baron Asset Fund to Baron Investment Funds Trust.

BOARD OF TRUSTEES RECOMMENDATION

The Board of Trustees of the Trust recommend that the name of the Trust be changed. Having the same name for both the Trust and one of its series has caused confusion. The simplest solution would be to rename the Trust.

18

REQUIRED VOTE

Approval of Proposal 2 requires the affirmative vote of a majority of the shares represented at the Meeting in person or by proxy and voting on the matter. THE BOARD OF TRUSTEES RECOMMENDS THAT THE SHAREHOLDERS OF THE TRUST VOTE IN FAVOR OF THIS PROPOSAL 2.

PROPOSAL 3 asks shareholders of the Baron Asset Fund series to eliminate certain of its fundamental investment restrictions and replace them with new restrictions. Certain other restrictions would not be changed. The new restrictions would be the same restrictions that Baron Growth Fund, Baron Small Cap Fund and Baron iOpportunity Fund have.

PROPOSED RESTRICTIONS

The proposed new restrictions are as follows:

Baron Asset Fund may not:

1. Issue senior securities or borrow money or utilize leverage in excess of 25% of its net assets (plus 5% for emergency or other short-term purposes) from banks from time to time.

2. Except as described in the prospectus or SAI, engage in short-sales, purchase securities on margin or maintain a net short position.

3. Purchase or sell commodities or commodity contracts except for hedging purposes and in conformity with regulations of the Commodities Futures Trading Commission such that the Fund would not be considered a commodity pool.

4. Purchase or sell oil and gas interests or real estate. Debt or equity securities issued by companies engaged in the oil, gas or real estate business are not considered oil or gas interests or real estate for purposes of this restriction. First mortgage loans and other direct obligations secured by real estate are not considered real estate for purposes of this restriction.

5. Make loans, except to the extent the purchase of debt obligations of any type (including repurchase agreements and corporate commercial paper) are considered loans and except that the Fund may lend portfolio securities to qualified institutional investors in compliance with requirements established from time to time by the Securities and Exchange Commission and the securities exchanges where such securities are traded.

6. Invest more than 15% of its assets in restricted or illiquid securities, including repurchase agreements maturing in more than seven days.

19

These restrictions would replace the following existing restrictions:

Baron Asset Fund may not:

1. Issue senior securities except in connection with any permitted borrowing where the Fund is deemed to have issued a senior security;

2. Borrow money except from banks for temporary purposes in an amount not exceeding 5% of the Fund's net assets at the time the borrowing is made;

3. Purchase securities on margin except for short-term credit necessary for the clearance of portfolio transactions;

4. Make short sales of securities, maintain a short position, or write put options;

5. Purchase or sell commodities or commodity contracts;

6. Purchase or sell real estate or real estate mortgage loans or invest in the securities of real estate companies unless such securities are publicly traded;

7. Invest in oil, gas or mineral-related programs or leases;

8. Invest more than 10% of the value of the Fund's total assets in securities which are restricted or illiquid or in repurchase agreements maturing or terminable in more than seven days;

9. Invest in securities of other open end investment companies (except in connection with a merger, consolidation or other reorganization and except for the purchase of shares of registered open-end money market mutual funds if double advisory fees are not assessed), invest more than 5% of the value of the Fund's total assets in more than 3% of the total outstanding voting securities of another investment company or more than 10% of the value of the Fund's total assets in securities issued by other investment companies;

10. Make loans to other persons, except up to 10% of the value of the Fund's total assets in loans of portfolio securities and except to the extent that the purchase of publicly traded debt securities and the entry into repurchase agreements in accordance with the Fund's investment objective and policies may be deemed to be loans;

11. Mortgage, pledge or hypothecate any portfolio securities owned or held by the Fund, except as may be necessary in connection with permitted borrowing;

12. Invest more than 5% of its total assets in warrants to purchase common stock;

13. Purchase securities of any issuer with a record of less than three years' continuous operation, including predecessors, except obligations issued or

20

guaranteed by the U.S. Government or its agencies or instrumentalities, if such purchase would cause the investments of the Fund in all such issuers to exceed 5% of the value of the total assets of the Fund; or

14. Purchase or retain any securities of an issuer any of whose officers, directors, trustees or security holders is an officer or Trustee of the Fund, or is a member, officer or Director of the Adviser, if after the purchase of the securities of such issuer by the Fund one or more of such persons owns beneficially more than 1/2 of 1% of the shares or securities, or both, all taken at market value, of such issuer, and such persons owning more than 1/2 of 1% of such shares or securities together own beneficially more than 5% of such shares or securities, or both, all taken at market value.

BOARD OF TRUSTEES RECOMMENDATION

The Board of Trustees of the Trust recommend the elimination of the existing investment restrictions and the adoption of the new investment restrictions. The Board believes that the new restrictions are reasonable and fair and that many of the old restrictions are outdated. The Board believes that this change will allow the Adviser more ability to better manage the portfolio and will facilitate its administration. The Board does not believe that the changes will materially increase the risks in connection with, the Fund.

EXPLANATION OF PROPOSED CHANGES AND RISK FACTORS:

PROPOSED ITEM 1 is similar to the existing restriction number 1, except that is would allow the Fund to borrow up to 30% of its net assets. The Fund is currently allowed to borrow up to 5% of its net assets for temporary purposes. To the extent the Fund borrows, it must maintain continuous asset coverage of 300% of the amount borrowed. Such borrowing has special risks. Any amount borrowed will be subject to interest costs that may or may not exceed the appreciation of the securities purchased.

PROPOSED ITEM 2 allows the Fund to utilize margin or short sales, if and as disclosed in the prospectus. Currently the Fund is not authorized to utilize margin or maintain a short position. The change will allow the Fund to take advantage of perceived market conditions, but BAMCO, Inc., the adviser to the Fund (the "Adviser"), does not believe this would be a significant part of the investment program. The risks associated with margin transactions are the same as in item 1 above. The Fund has to borrow the security it wishes to sell short. The market value of the security sold short may increase and the Fund would lose money because it will have to pay a higher price to repurchase the borrowed stock when it closes its short position. The loss of value on a short sale is theoretically unlimited if the Fund is unable to close out a short position at an acceptable price or time.

21

PROPOSED ITEM 3 allows the Fund to engage in commodities transactions for hedging purposes only. Currently the Fund cannot engage in commodities transactions for any purpose. The Adviser does not believe that this would be a significant part of the Fund's investment program, but would like the ability to utilize appropriate hedging techniques should market conditions warrant. The hedging technique may be not be successful and the market conditions could change, resulting in the hedge reducing the value of the portfolio.

PROPOSED ITEM 4 is similar to the existing restrictions numbers 6 and 7. The language is different but the restriction is the same, namely that the Fund may not invest directly in real estate or oil and gas ventures, but it can purchase securities of companies engaged in those businesses.

PROPOSED ITEM 5 would allow the Fund to loan its portfolio securities to qualified institutional investors in accordance with then-current Securities and Exchange Commission requirements. Currently the Fund is allowed to loan up to 10% of its portfolio securities. The Adviser does not believe this would be a significant part of the Fund's investment program. Historically the Fund has not engaged in stock loan.

PROPOSED ITEM 6 would increase the percentage of the Fund's assets that could be invested in restricted or illiquid securities to 15% from 10%. The Adviser believes that the additional 5% gives it more flexibility in managing the portfolio and gives it additional investment opportunities. There is also additional risk. The absence of a trading market could make it difficult to ascertain a market value for illiquid positions. The Fund's net asset value could be adversely affected if there were no ready buyer at an acceptable price at the time the Fund decided to sell. Time consuming negotiations and expenses could occur in disposing of the shares.

In addition to the revisions described above, existing items 4, 9, 12 and 14 would be eliminated. The reasons are described below.

ITEM 4 prohibits the Fund from engaging in short sales and writing put
options. The short sales are addressed in new item 2. The Fund is currently authorized to engage in other types of options transactions (it may write covered call options and purchase put options), but the Adviser would like the ability to, like the other Baron Funds, write put options and purchase call options where consistent with the prospectus and where market conditions warrant. A put option gives the purchaser of the option the right to sell, and when exercised, obligates the writer to buy, the underlying security at the exercise price. A call option gives the purchaser of the option the right to buy, and when exercised, obligates the writer to buy, the underlying security at the exercise price. Options may fail as hedging techniques in cases where the price movements of the securities underlying the options do not follow the price movements of the portfolio securities subject to the hedge. Gains on investments in options and derivatives depend on the Adviser's ability to anticipate

22

correctly the direction of stock prices, interest rates, and other economic factors. Options may lose all their value in a relatively short period of time.

ITEM 9 prohibits the Fund from investing in other investment companies. The
Adviser believes that this should not be a fundamental restriction but should be governed by what the prospectus allows the Fund to do. The Fund has never had significant investments in other investment companies and the Adviser has no present intention of changing that policy.

EDGAR® is a federally registered trademark of the U.S. Securities and Exchange Commission. EDGAR®Online is not affiliated with or approved by the U.S. Securities and Exchange Commission.