As filed with the Securities and Exchange Commission on MARCH 31, 1998

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-K

(Mark One)
     X               Annual Report Pursuant to Section 13 or
                  15(d) of the Securities Exchange Act of 1934
                                 [Fee Required]
                   For the fiscal year ended DECEMBER 31, 1997
                                       or
            Transition Report Pursuant to Section 13 or 15(d) of the
                Securities Exchange Act of 1934 [No Fee Required]

             For the Transition Period From __________ to __________

                      Commission File Number 0-9667 BULL &
                                BEAR GROUP, INC.
             (Exact name of registrant as specified in its charter)

           Delaware                                      13-1897916
(State of incorporation)                   (I.R.S. Employer Identification No.)

11 Hanover Square, New York, New York                          10005
   (Address of principal executive offices)                  (Zip Code)

Registrant's telephone number, including area code:           (212) 785-0900

Securities registered pursuant to Section 12(b) of the Act:

Title of each class                    Name of each exchange on which registered
      None                                                 None

Securities registered pursuant to Section 12(g) of the Act:

Class A Common Stock, Par Value $.01 Per Share
      Indicate by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes X No .

      Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]

      No voting stock was held by  non-affiliates  of the registrant as of March
15, 1998.

      The number of shares  outstanding of each of the  registrant's  classes of
common stock, as of March 15, 1998:

Class A Non-Voting  Common  Stock,  par value $.01 per share - 1,350,017  shares
Class B Voting Common Stock, par value $.01 per share - 20,000


<PAGE>


                                     PART I


ITEM                                                                   PAGE

   1.    Business                                                       2

   2.    Properties                                                     6

   3.    Legal Proceedings                                              7


                                     PART II

   4.    Submission of Matters to a Vote of Security Holder             8

   5.    Market for Company's Common Equity and Related
         Stockholder Matters                                            8

   6.    Selected Financial Data                                        8

   7.    Management's Discussion and Analysis of Financial Condition
         and Results of Operations                                      10

   8.    Financial Statements and Supplementary Data                    12

   9.    Changes in and Disagreements with Accountants on
            Accounting and Financial Disclosure                         29


                                    PART III

  10.    Directors and Executive Officers                               30

  11.    Executive Compensation                                         32

  12.    Security Ownership of Certain Beneficial Owners and
         Management                                                     38

  13.    Certain Relationships and Related Transactions                 39


                                     PART IV

  14.    Exhibits, Consolidated Financial Statements and Schedules,
            and Reports on Form 8-K                                     40



<PAGE>



                                     PART I


ITEM 1.      BUSINESS

      Bull & Bear Group, Inc., a Delaware corporation (the "Company"), is a
holding company with seven principal subsidiaries:  Bull & Bear Advisers, Inc.
("BBAI"), Bull & Bear Securities, Inc. ("BBSI"), Investor Service Center, Inc.
("ISC"), Midas Management Corporation ("MMC"), Rockwood Advisers, Inc. ("RAI"),
Performance Properties, Inc. ("Performance Properties") and Hanover Direct
Advertising Company, Inc.("Hanover Direct").

      BBAI,  MMC and RAI act as investment  managers to open-end and  closed-end
management  investment  companies (the "Funds")  registered under the Investment
Company Act of 1940 (the  "Act").  The open-end  Funds are:  Bull & Bear Special
Equities  Fund,  Inc.;  Bull & Bear Gold  Investors  Ltd.;  Bull & Bear U.S. and
Overseas  Fund, a series of shares  issued by Bull & Bear Funds I, Inc.;  Bull &
Bear Dollar  Reserves,  a series of shares of Bull & Bear Funds II, Inc.;  Midas
Fund, Inc.; and Rockwood Fund, Inc. The closed-end funds are: Bull & Bear Global
Income Fund, Inc., Bull & Bear U.S. Government  Securities Fund, Inc. and Bull &
Bear Municipal Income Fund, Inc.

      BBSI was organized in 1984 to operate a discount brokerage  service.  BBSI
has access to every major U.S.  stock,  option and bond  exchange as well as the
over-the-counter  market.  Investors  may use the  discount  brokerage  services
provided by BBSI to trade stocks,  bonds and options at  substantial  commission
discounts from full cost rates,  access their  investment in any of the Funds to
pay for securities  purchased,  or invest proceeds of sales of securities in the
Funds. BBSI is registered with the Securities and Exchange Commission ("SEC") as
a  broker/dealer  and is a member  of the  National  Association  of  Securities
Dealers, Inc. ("NASD") and Securities Investor Protection Corporation ("SIPC").

      ISC  was  organized  in  1985  and  is  registered   with  the  SEC  as  a
 broker/dealer  and  is a  member  of  the  NASD.  ISC  acts  as  the  principal
 distributor and shareholder administrator for the open-end Funds.

      Performance Properties was organized in 1994 to invest in real estate.

      Hanover  Direct was organized in 1988 and acts as an  advertising  agency,
which places advertising for ISC on behalf of the Funds and for BBSI. Currently,
the commission  revenue generated by Hanover Direct from ISC and BBSI represents
a recapture of sums paid for advertising  and,  rather than  additional  income,
represents a reduction in  advertising  expense of ISC and BBSI.  Hanover Direct
has not performed any work for unaffiliated clients.

      The Company has granted  the Funds and its  subsidiaries  a  non-exclusive
license to use service  marks  owned by the  Company,  including  "Bull & Bear,"
"Bull & Bear  Performance  Driven,"  "Midas,"  and  "Performance  Driven"  under
certain  terms and  conditions  on a royalty  free  basis.  Such  license may be
withdrawn from a Fund in the event the  investment  manager of the Fund is not a
subsidiary of the Company or in other cases, at the discretion of the Company.



                                        2


<PAGE>


INVESTMENT MANAGEMENT BUSINESS
      The  Company is  engaged,  through its  subsidiaries,  in the  business of
managing  investment  companies  registered  under the Act.  The Funds and their
respective net assets as of December 31, 1997 were as follows:

    Bull & Bear Dollar Reserves                           $  61,590,000
    Bull & Bear Global Income Fund, Inc.                     24,148,000
    Bull & Bear Gold Investors Ltd.                           9,363,000
    Bull & Bear Municipal Income Fund, Inc.                  12,139,000
    Bull & Bear Special Equities Fund, Inc.                  44,773,000
    Bull & Bear U.S. and Overseas Fund                        8,877,000
    Bull & Bear U.S. Government Securities Fund, Inc.        10,985,000
    Midas Fund, Inc.                                        100,821,000
    Rockwood Fund, Inc.                                       1,365,000
                                                         ---------------
               TOTAL NET ASSETS                            $274,061,000

      The fund  management  industry  along with the entire  financial  services
sector of the economy has been rapidly  changing to meet the increasing needs of
investors.  Competition  for management of financial  resources has increased as
banks,  insurance  companies and  broker/dealers  have  introduced  products and
services  traditionally offered by independent fund management companies.  There
are also many fund management groups with  substantially more resources than the
Company. While Congress,  governmental agencies and special interest groups have
been  struggling  with  regulatory  problems  created  by  consolidation  of the
financial services  industry,  the Company continues to develop products to meet
the specialized  requirements of investors.  While the Company's business is not
seasonal, it is affected by the financial markets,  which in turn, are dependent
upon current and future economic conditions.

      Drastic material declines in the securities markets can have a significant
effect on the Company's  business.  Volatile stock markets may affect management
and distribution fees earned by the Company's subsidiaries.  If the market value
of securities owned by the Funds declines,  assets under management will decline
and  shareholder  redemptions  may occur,  either by transfer  out of the equity
Funds and into the money market  Fund,  Bull & Bear Dollar  Reserves,  which has
lower  management  and  distribution  fee rates  than the  equity  Funds,  or by
redemptions out of the Funds entirely.  Lower asset levels in the Funds may also
cause  or  increase   reimbursements  to  the  Funds  pursuant  to  the  expense
limitations described below.

      In  general,  investment  management  services  are  rendered to the Funds
pursuant  to  written  contractual  agreements.  Such  agreements  relate to the
general  management of the affairs of each Fund, in addition to supervising  the
acquisition and sale of each Fund's  portfolio  investments.  As provided in the
agreements,  BBAI, MMC and RAI may receive  management fees ranging from 0.4% to
1.0% per annum of the Funds'  average  daily net assets.  The Act requires  that
such  contractual  agreements  be  initially  approved  by the  Funds'  Board of
Directors,  including a majority of all of the directors who are not "interested
persons"  (as  defined  in the  Act),  and  by the  vote  of a  majority  of the
outstanding shares of the Fund (as defined in the Act). Agreements, if approved,
may be for a term of up to two years, and thereafter  their  continuance must be
approved at least annually by a majority of the directors of the Fund, including
a majority of those directors of the Fund who are not "interested  persons",  or
by such a vote of  "disinterested"  directors  and the vote of a majority of the
outstanding shares of the Fund. In addition,  all such agreements are subject to
termination on 60 days' notice by majority vote of the Board of Directors or the
shareholders  and  are  subject  to  automatic   termination  in  the  event  of
assignment.  Depending on the assets of the Fund involved and other factors, the
termination of any of the agreements for investment  management services between
any of the Funds,  BBAI, MMC and RAI may have a serious  adverse impact upon the
Company.




                                        3


<PAGE>


      Pursuant to contracts with these Funds,  BBAI, MMC and RAI are entitled to
management fees, which are received monthly and are based on annual  percentages
of the average daily net assets of the Funds. Under the contracts, BBAI, MMC and
RAI are required to reimburse the Funds for certain  expenses to the extent that
such expenses exceed limitations  prescribed by any state in which shares of the
Funds are  qualified for sale,  although  currently the Funds are not subject to
any such limits.  In addition,  from time to time BBAI, MMC and RAI may waive or
reimburse management fees to increase a Fund's performance. MMC has entered into
a subadvisory  agreement with respect to Midas Fund, Inc. MMC not the respective
Fund, pays the Subadviser,  Lion Resource Management Limited, based upon the net
fees, performance and net assets of the Fund.

      Each of the open-end Funds has adopted a plan of distribution  pursuant to
Rule 12b-1 under the Act (the "Plan"). Pursuant to the Plans, ISC may receive as
compensation  amounts ranging from one-quarter of one percent to one percent per
annum of the  Funds'  average  daily net  assets for  distribution  and  service
activities.  The service fee portion is intended to cover  services  provided to
shareholders  in the Funds and the  maintenance  of  shareholder  accounts.  The
distribution fee portion is to cover all other activities and expenses primarily
intended to result in the sale of the Funds' shares.

      Bull & Bear U.S. Government  Securities Fund, Bull & Bear Municipal Income
Fund, and Bull & Bear Global Income Fund  converted from an open-end  investment
company to a closed-end  investment company in October 1996,  November 1996, and
February 1997, respectively,  pursuant to the vote of the Fund's shareowners and
their shares commenced  trading on the American Stock Exchange under the symbols
BBG, BBM and BBZ, respectively.  Upon conversion, the Distribution,  12b-1 Plan,
and Shareholder  Administration  Agreements  between the respective Fund and ISC
were  terminated and  substantially  similar  Investment  Management  Agreements
between BBAI and each Fund were approved.

      The Act requires that a plan of distribution be initially  approved by the
Fund's Board of  Directors,  including a majority of the  directors  who are not
"interested  persons" and who have no financial interest in the Plan, and by the
vote of a majority of the outstanding shares of the Fund. If approved, a plan of
distribution  may be for a term of one year,  and thereafter it must be approved
at least  annually  by the entire  Board of  Directors  and by a majority of the
"disinterested" directors. In addition, all plans of distribution are subject to
termination  at any time by  majority  vote of the  disinterested  directors  or
shareholders.

      BBAI, MMC and RAI are registered with the SEC as investment advisers under
the  Investment  Advisers  Act of  1940.  ISC is  registered  with  the SEC as a
broker/dealer  under the Securities  Exchange Act of 1934 and is a member of the
NASD.  The Funds are  registered  with the SEC under the Act. The  activities of
BBAI,  MMC and RAI and of the Funds are subject to regulation  under Federal and
state securities laws. The provisions of these laws, including those relating to
the contractual arrangements between the Funds and their investment manager, are
primarily  designed  to  protect  the  shareholders  of the  Funds  and  not the
shareholders of the Company.

DISCOUNT BROKERAGE BUSINESS
      BBSI, with access to every major U.S.  stock,  option and bond exchange as
well as the  over-the-counter  market,  provides discount  brokerage services to
investors   throughout  the  United  States  and  various   foreign   countries.
Substantial  commission  savings  off  full  service  rates  as well as  prompt,
courteous service and professional order execution are available to all accounts
regardless  of how often  trades  are made.  All  accounts  are  carried by U.S.
Clearing Corp., a division of Fleet Securities,  Inc., a New York Stock Exchange
member firm.
 The SIPC,  of which BBSI and U.S.  Clearing  Corp.  are members,  protects each
account against broker/dealer insolvency (not market losses) for up to $500,000,
of which $100,000 may be in cash. In addition, Aetna Casualty and Surety Company
protects each account for an additional $49,500,000 in securities value.



                                        4
<PAGE>



      BBSI  offers  investors  commission  savings  of up to 84% over  full cost
brokers and guarantees  commissions  20% less than Charles Schwab & Co. on every
stock,  bond and option trade.  BBSI  customers  may save an  additional  10% in
commissions with every trade entered via touch-tone  telephone (Market Touch) or
through proprietary PC software (Market Touch Plus).

      Investors may also buy and sell listed and NASDAQ stocks for a flat $19.95
for up to 1,000 shares, $.02 per share thereafter through the internet at Bull &
Bear  Securities'  web page,  ebullbear.com.  In addition to efficiency  and low
commissions, ebullbear.com customers receive free investment information on over
6,000 companies,  plus quotes, charts, market averages, and free live market and
business news through  Reuters,  one's of the world's leading news and financial
information  companies.   BBSI  customers  are  provided  with  free  investment
information from Standard & Poor's,  including the year-end Stock Guide,  Market
Month, Stock Reports, Stock Screens, Industry Reports, The Outlook, and Emerging
& Special Situations.

      In May of 1997,  BBSI  became  an  AAdvantage  Participant  with  American
Airlines  whereby BBSI customers may earn  AAdvantage  miles for their investing
activities: 1,000 miles for opening an account, 200 miles for every trade, up to
2,000  miles  for each full  account  transfer,  up to 5,000  miles per year for
maintaining account equity at certain levels, 500 miles for the first electronic
trade and 500 miles per customer referral.

      BBSI also offers its customers a no-fee cash management  service featuring
unlimited  free  check  writing  with  no  check  writing  minimum  (Bull & Bear
Performance Plus Account7),  the Bull & Bear No-Fee IRA7, and Bull & Bear Mutual
Funds Network (a no transaction fee, no-load mutual funds service).

      Volatile  stock markets  could have a significant  effect on the brokerage
commissions  earned by BBSI by affecting the number of  transactions  processed.
BBSI is  responsible  for potential  losses  resulting from trade errors of BBSI
personnel and  customers' bad debts,  including  under-margined  accounts.  As a
discount broker,  BBSI does not give investment advice and therefore  management
believes  it is less  likely  to be  involved  in  significant  litigation  with
customers, as may be typical in the ordinary course of business of a broker that
does give investment advice to its customers.

FORWARD-LOOKING INFORMATION
      Information  or  statements  provided by or on behalf of the Company  from
time to time,  including those within this Form 10-K Annual Report,  may contain
certain  "forward-looking   information",   including  information  relating  to
anticipated growth in revenues or earnings per share, anticipated changes in the
amount  and  composition  of assets  under  management  and  discount  brokerage
customers'  equity and trading,  anticipated  expense levels,  and  expectations
regarding  financial  market  conditions.  The Company cautions readers that any
forward-looking  information  provided  by or on behalf of the  Company is not a
guarantee of future  performance  and that actual results may differ  materially
from  those in  forward-looking  information  as a result  of  various  factors,
including   but  not   limited  to  those   discussed   below.   Further,   such
forward-looking  statements  speak only as of the date on which such  statements
are made, and the Company undertakes no obligation to update any forward-looking
statement  to  reflect  events or  circumstances  after  the date on which  such
statement is made or to reflect the occurrence of unanticipated events.



                                        5



<PAGE>



      The  Company's  future  revenues may fluctuate due to factors such as: the
total value and  composition of assets under  management and discount  brokerage
customers'  equity and  trading,  and related cash inflows or outflows in mutual
funds and  discount  brokerage  firms;  fluctuations  in the  financial  markets
resulting  in  appreciation  or  depreciation  of assets  under  management  and
discount  brokerage  customers'  equity and  trading;  the  relative  investment
performance  of the  Company's  sponsored  investment  products  as  compared to
competing  products  and  market  indices;  the  expense  ratios and fees of the
Company's  sponsored  products and  services;  investor  sentiment  and investor
confidence  in mutual funds and  discount  brokerage  firms;  the ability of the
Company to maintain  investment  management  fees and brokerage  commissions  at
current  levels;  competitive  conditions  in  the  mutual  funds  and  discount
brokerage  industries;  the  introduction  of new  mutual  funds and  investment
products  and new  discount  brokerage  services;  the ability of the Company to
contract with the Funds for payment for  administrative  services offered to the
Funds and Fund  shareholders;  the continuation of trends in the retirement plan
marketplace  favoring  defined   contribution  plans  and   participant-directed
investments;  and the amount and timing of income from the Company's  investment
portfolio.

      The Company's future  operating  results are also dependent upon the level
of operating  expenses,  which are subject to  fluctuation  for the following or
other  reasons:  changes in the level of  advertising  expenses  in  response to
market  conditions or other  factors;  variations  in the level of  compensation
expense incurred by the Company, including performance-based  compensation based
on the Company's  financial results,  as well as changes in response to the size
of the  total  employee  population,  competitive  factors,  or  other  reasons;
expenses  and capital  costs,  including  depreciation,  amortization  and other
non-cash  charges,  incurred by the Company to maintain its  administrative  and
service  infrastructure;  and  unanticipated  costs that may be  incurred by the
Company from time to time to protect investor accounts and client goodwill.

      The Company's  revenues are  substantially  dependent on revenues from the
Funds, which could be adversely affected if the independent  directors of one or
more of the Funds  determined  to terminate or  renegotiate  the terms of one or
more investment management agreements.

      The  Company's  business  is  also  subject  to  substantial  governmental
regulation,  and changes in legal, regulatory,  accounting,  tax, and compliance
requirements may have a substantial effect on the Company's business and results
of  operations,  including  but not  limited  to  effects  on the level of costs
incurred by the Company  and  effects on  investor  interest in mutual  funds in
general or in particular classes of mutual funds.


ITEM 2.  PROPERTIES

      The principal  office of the Company is located at 11 Hanover Square,  New
York, New York 10005.  The approximate area of the office is 11,400 square feet.
The rent is  approximately  $144,000  per  annum  plus  $32,550  per  annum  for
electricity.  The lease  expires on December 31, 1998 and is  cancelable  at the
option of the Company on three months'  notice.  BBSI has a branch office at 395
East Palmetto Boulevard,  Boca Raton,  Florida consisting of approximately 2,000
square  feet. A portion of the rent is  approximately  $55,000 per annum and the
lease expires on August 30, 1999.

      Performance  Properties  purchased  land and a two story  office  building
located in Red Bank, New Jersey in 1994. The building  consists of approximately
13,000 square feet. The building was purchased for cash, has no mortgage and was
purchased  as an  investment.  A portion of the second  floor of the building is
currently being rented under a five-year lease to a tenant.  The current rent is
approximately  $33,000  per annum and  increases  each year over the life of the
lease.



                                        6


<PAGE>



ITEM 3.    LEGAL PROCEEDINGS

      The Company and its directors are defendants in a lawsuit brought on April
24,  1995 by  Maxus  Investment  Group,  Maxus  Capital  Partners,  Maxus  Asset
Management,  Inc., and Maxus Securities Corp.  (collectively "Maxus"), which now
claim to collectively own or control 144,000 shares,  or approximately  10.7% of
the Class A common stock of the Company.  The action,  seeking  declaratory  and
injunctive  relief,  was filed in the federal  district  court for the  Southern
District of New York and  purports to be brought on the  plaintiffs'  own behalf
and derivatively on behalf of the Company. On April 11, 1996, the district court
dismissed as a matter of law all claims brought by the  plaintiffs  except those
relating to the voiding of 1993  exercises,  the  exercise of certain 1990 stock
options and plaintiffs' request for attorneys' fees from the Company. Defendants
thereafter  filed  answers  denying  liability.  The Company  believes  that the
lawsuit is without merit and intends to continue  defending the remaining claims
vigorously.

      Although a group called Karpus Investment  Management  ("KIM")  previously
failed to elect its slate of nominees in  opposition  to  management at the 1997
annual meeting of stockholders of Bull & Bear U.S.  Government  Securities Fund,
Inc. ("BBG"),  a closed-end fund managed by BBAI,  another BBG annual meeting is
scheduled  for 1998.  In addition,  on February  19,  1998,  BBG filed a lawsuit
against KIM in the United States District Court for the Southern District of New
York, 98 Civ. 1190, and KIM filed a lawsuit against BBG in the Circuit Court for
Baltimore City,  Maryland,  Case No.  9805005.  The outcome of these matters and
their effect on the Company or BBAI's  management  agreement  with BBG cannot be
predicted with certainty.

      From time to time, the Company and/or its  subsidiaries  are threatened or
named as defendants in litigation  arising in the normal course of business.  As
of December  31,  1997,  neither the  Company  nor any of its  subsidiaries  was
involved in any other litigation that, in the opinion of management,  would have
a material adverse impact on the consolidated financial statements.





                                        7



<PAGE>



                                     PART II


ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS DURING FOURTH
          QUARTER OF THE YEAR ENDED DECEMBER 31, 1997
-------


      By unanimous  written  consent of the Class B  shareholder  on October 29,
1997,  the actions of the Board of Directors of the Company in adopting the Bull
& Bear Group, Inc. 1995 Long-Term Incentive Plan, As Amended,  were ratified and
approved.


ITEM 5.  MARKET FOR THE COMPANY'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

      The Company's  Class A Common Stock trades on the Nasdaq  SmallCap  Market
tier of the Nasdaq Stock Market under the symbol BNBGA.  The  Company's  Class B
Common Stock has no public trading market.  There are  approximately 300 holders
of  record of Class A Common  Stock  and 1 holder of Class B Common  Stock as of
December 31, 1997. In addition,  there are an indeterminate number of beneficial
owners of Class A Common Stock that are held in "street name". No dividends have
been paid on either class of Common Stock in the past five years and the Company
does not expect to pay any such dividends in the  foreseeable  future.  The high
and low sales prices of the Class A Common Stock  during each  quarterly  period
over the last two years were as follows:

                                       1997                     1996
                                  --------------           --------------
                                 HIGH        LOW           HIGH        LOW
   First Quarter                 $4-3/8    $2-3/4         $6-3/4      $1-5/8
   Second Quarter                $4-3/8    $2-7/8         $5-3/8      $3-1/4
   Third Quarter                 $3-1/8    $2-5/8         $4          $2-1/2
   Fourth Quarter               $3-5/16    $2-1/4         $3-1/4      $2-7/8


ITEM 6.           SELECTED FINANCIAL DATA

      The selected  financial data for the five years ended December 31, 1997 is
presented on the following pages.




                                        8



<PAGE>


<TABLE>
<CAPTION>

                                                    BULL & BEAR GROUP, INC.

                                             CONSOLIDATED SELECTED FINANCIAL DATA

                                               FOR THE YEARS ENDED DECEMBER 31,



                                                           1997            1996            1995             1994          1993
                                                           ----            ----            ----             ----          ----
REVENUES:
<S>                                                      <C>             <C>             <C>           <C>            <C>
   Management, distribution and administration fees      $4,313,947      $4,922,945      $3,322,348    $3,786,066     $4,092,229
   Brokerage commissions                                  2,452,272       2,351,983       1,821,513     1,768,527      2,047,999
   Dividends, interest and other                            221,198         142,084         147,169         (7,378)      227,422
                                                       ------------    ------------    ------------  -------------   -----------
                                                          6,987,417       7,417,012       5,291,030     5,547,215      6,367,650
                                                        -----------     -----------     -----------   -----------    -----------
EXPENSES:
   General and administrative                             3,903,524       4,040,219       3,195,115     3,225,891      3,519,704
   Marketing                                              1,081,050       1,821,297         779,026     1,361,155      1,389,204
   Clearing and brokerage charges                           621,412         708,535         576,096       532,832        619,673
   Subadvisory fees                                         387,593         705,248          22,496        37,728         34,629
   Professional fees                                        201,417         296,874         431,934       170,284        170,687
   Amortization and depreciation                            131,992         138,116          97,399        98,094        125,399
                                                       ------------    ------------   -------------  ------------    -----------
                                                          6,326,988       7,710,289       5,102,066     5,425,984      5,859,296
                                                        -----------     -----------     -----------   -----------    -----------

Income (loss) before provision for income taxes             660,429         (293,277)       188,964       121,231        508,354
INCOME TAXES                                                 34,704          27,248          32,588        37,771         39,149
                                                       ------------   -------------   -------------  ------------    -----------
NET INCOME (LOSS)                                       $   625,725      $  (320,525)   $   156,376  $     83,460    $   469,205
                                                        ===========      ===========    ===========  ============    ===========

NET INCOME (LOSS) PER SHARE OF WEIGHTED
AVERAGE COMMON STOCK OUTSTANDING:
   Basic                                                    $.46           $(.23)          $.10            $.05          $.37
                                                            ====           =====           ====            ====          ====
   Diluted                                                  $.43           $(.23)          $.10            $.05          $.32
                                                            ====           =====           ====            ====          ====

WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING:
   Basic                                                 1,370,017       1,369,555      1,499,516       1,523,152      1,257,844
                                                        ===========     ===========     ===========     ===========    ===========
   Diluted                                               1,468,252       1,369,555      1,549,815       1,610,658      1,480,654
                                                        ===========     ===========     ===========     ===========    ===========

TOTAL ASSETS                                            $4,827,074      $4,273,110     $4,963,792      $4,240,241     $4,711,438
                                                        ==========      ==========     ==========      ==========     ==========

LONG-TERM OBLIGATIONS                                   $    7,460      $   22,093     $     -         $    -         $   -
                                                        ==========      ==========     ===========     ==========     =========

</TABLE>


                                        9


<PAGE>





ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

1997 Compared to 1996
      Total  revenues for the year  decreased  $429,595 or 5.8%.  Management and
distribution   fees   decreased   $215,407  or  6.9%  and   $429,986  or  27.4%,
respectively,  and shareholder  administration  fees increased $36,395 or 14.6%.
The decrease in management and distribution  fees was due to an overall decrease
in the net asset levels of the Funds from which these  revenues  are  generated.
Shareholder  administration  fees represent  reimbursement  for actual  expenses
incurred. Such fees increase as the costs for providing these services increase.
Net assets  under  management  were  approximately  $401 million to December 31,
1996,  $359  million at March 31,  1997,  $328  million at June 30,  1997,  $353
million at September  30, 1997 and $274 million at December 31, 1997.  Brokerage
commissions  increased  $100,289  or  4.3%  while  brokerage  customers'  equity
increased to $244 million or 30%. The increase in brokerage  commissions was due
to an increase in customer transaction activity.  Dividends,  interest and other
income  increased   $79,114  or  55.7%  primarily  due  to  gains  on  sales  of
investments.

      Total expenses,  including income taxes decreased  $1,375,845 or 17.8% for
the year.  General  and  administrative  expenses  decreased  $136,695  or 3.4%.
Marketing  expenses decreased $740,247 or 40.6% due to lower marketing costs for
the Midas Fund. Clearing and brokerage charges decreased $87,123 or 12.3% due to
the savings from a new clearing agreement beginning July 1996.  Subadvisory fees
decreased  $317,655  or 45.0%  because  of lower net  assets in the Midas  Fund.
Professional  fees  decreased  $95,457  or 32.2% due to lower  litigation  costs
relating to the Maxus lawsuit. Amortization and depreciation decreased $6,124 or
4.4% for the year.

      Net income for 1997 was $625,725 or $.46 per share as compared to net loss
of $320,525 or $.23 per share in 1996.

1996 COMPARED TO 1995
      Total revenues for the year increased $2,125,982 or 40.2%.  Management and
distribution  fees  increased   $1,429,766  or  85.5%  and  $284,319  or  22.1%,
respectively,  and shareholder  administration fees decreased $113,488 or 31.2%.
The increase in management and distribution  fees was due to an overall increase
in the net asset levels of the Funds from which these  revenues  are  generated.
Shareholder  administration  fees represent  reimbursement  for actual  expenses
incurred.  Such  fees  decreased  as the  costs  for  providing  these  services
decreased.  Net assets under  management  were  approximately  $237.4 million at
December 31, 1995,  $317.6 million at March 31, 1996, $393.2 million at June 30,
1996,  $432.1  million at September 30, 1996, and $400.9 million at December 31,
1996.  Brokerage   commissions  increased  $530,470  or  29.1%  while  brokerage
customers'  equity  increased  to $187 million or 28%. The increase in brokerage
commissions  was due to an  increase in customer  transaction  activity  and the
continued  growth in the number of discount  brokerage  accounts and  customers'
equity.  Dividends,  interest and other amounted to $142,084 in 1996 compared to
$147,169 in 1995.  Dividends and interest  decreased $5,085 or 3.5% due to lower
earnings on the Company's short term investments.

      Total  expenses  increased  $2,608,223 or 51.1% for the year.  General and
administrative   expenses   increased   $845,104  or  26.4%  because  of  higher
compensation,  higher  bonuses paid to employees of the Company  relating to the
growth in the Company's  businesses  and higher expense  reimbursements  for the
Funds.  Marketing expenses  increased  $1,042,271 or 133.8% primarily related to
the  launching  of the  Midas  Fund  during  the first  six  months of 1996.  In
addition,  the Company incurred  increased  marketing  expenses  relating to the
introduction  of Bull & Bear Online  Investment  Center and the promotion of the
American  Airlines7  AAdvantage  Miles7 program through Bull & Bear  Securities,
Inc. Clearing and brokerage  charges  increased  $132,439 or 23.0% because of an
increased  level  of  discount   brokerage  customer   transactions   processed.
Professional  fees  decreased  $135,060 or 31.3% due to lower  litigation  costs
relating to the Maxus lawsuit.  Subadvisory  fees increased  $682,752 because of
the growth in assets of the Midas Fund.
Amortization and depreciation increased $40,717 or 41.8% for the year.

      Net loss for 1996 was $320,525 or $.22 per share as compared to net income
of $156,376 or $.10 per share in 1995.

                                       10


<PAGE>





LIQUIDITY AND CAPITAL RESOURCES
      The following table reflects the Company's  consolidated  working capital,
total assets, long-term debt and shareholders' equity as of the dates indicated.

                                                     DECEMBER 31,
                                    1997            1996           1995
                                    ----            ----           ----
  Working Capital                $2,662,917      $2,293,200      $2,792,059
  Total Assets                   $4,827,074      $4,273,110      $4,963,792
  Long-Term Debt                 $    7,460      $   22,093      $    -
  Shareholders' Equity           $4,455,111      $3,917,886      $4,170,095

      For the year ended 1997,  working capital,  total assets and shareholders'
equity increased $369,717, $553,964 and $537,225,  respectively.  Long-term debt
decreased $14,633.

      Working capital increased  primarily as a result of the net income and the
non-cash items of depreciation  and amortization for 1997 offset by improvements
to real estate held for  investment,  purchases of equipment and the decrease in
unrealized capital gains on marketable securities. The increase in shareholders'
equity was primarily the result of the net income for 1997 of $625,725 offset by
the decrease in unrealized  capital  gains on marketable  securities of $88,500.
Total assets  increased  primarily as a result of the net income for 1997 offset
by the decrease in unrealized capital gains on marketable securities of $88,500.
Long-term debt decreased due to payments on the capitalized lease obligations.

      For the year ended 1996,  working capital,  total assets and shareholders'
equity decreased $498,859, $690,682 and $252,209,  respectively.  Long-term debt
increased $22,093.

      Working  capital  decreased  as a result  of the net loss for 1996 and the
acquisition  of intangible  assets and fixed assets offset by the non-cash items
of  depreciation  and  amortization.  The decrease in  shareholders'  equity was
primarily the result of the net loss for 1996 of $320,525 offset by the issuance
of common  stock on  exercise  of stock  options of $3,750 and the  increase  in
unrealized  capital  gains on  marketable  securities  of $64,566.  Total assets
decreased  as a result of the net loss and the  decrease in current  liabilities
offset by the increase in unrealized gains on marketable  securities.  Long-term
debt increased due to the capitalized lease obligations for equipment.

      For the year 1995, working capital,  total assets and shareholders' equity
increased $12,337, $723,551 and $260,396, respectively.

      Working  capital  increased  as a result of the net income  for 1995,  the
non-cash  expense  items  of  depreciation   and  amortization   offset  by  the
acquisition of intangible assets and fixed assets. The increase in shareholders'
equity was  primarily  the result of the net  income for 1995 of  $156,376,  the
issuance  of common  stock on  exercise  of stock  options  of  $33,000  and the
unrealized  capital  gains on  marketable  securities  of $66,020.  Total assets
increased  as a  result  of net  income,  the  unrealized  gains  on  marketable
securities and the increase in current liabilities.

      Management knows of no contingencies  that are reasonably likely to result
in a  material  decrease  in the  Company's  liquidity  or that  are  likely  to
adversely affect the Company's capital resources. This includes the restrictions
placed on the  transfer of funds to the Company from BBSI and ISC as a result of
their  regulatory  net capital  requirements.  At December 31, 1997,  the amount
subject to these restrictions was $275,000 or 5.7% of total assets.

EFFECTS OF INFLATION AND CHANGING PRICES
      Since the Company derives revenue from investment management, distribution
and  shareholder  administration  services  from the  Funds  and  from  discount
brokerage  services,  it is not  possible  for it to  discuss  or  predict  with
accuracy  the impact of  inflation  and  changing  prices on its  revenues  from
continuing operations.

                                       11


<PAGE>





ITEM 8.      FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

      Financial   Statements   required  by  Regulation  S-X  and  Supplementary
Financial Information required by Regulation S-K are presented herein.

                  FINANCIAL STATEMENTS AND SUPPORTING SCHEDULES

                                TABLE OF CONTENTS

                                                                    PAGE

Report of Independent Certified Public Accountants                   13

Consolidated Balance Sheets,
   December 31, 1997 and 1996                                        14

Consolidated Statements of Income,
   Years ended December 31, 1997, 1996 and 1995                      15

Consolidated Statements of Changes in Shareholders' Equity,
   Years ended December 31, 1997, 1996 and 1995                      16

Consolidated Statements of Cash Flows,
   Years ended December 31, 1997, 1996 and 1995                      17

Notes to Consolidated Financial Statements                           19







                                       12



<PAGE>



               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS



THE BOARD OF DIRECTORS AND SHAREHOLDERS OF
BULL & BEAR GROUP, INC.:


We have  audited the  accompanying  consolidated  balance  sheets of Bull & Bear
Group,  Inc. and  subsidiaries as of December 31, 1997 and 1996, and the related
consolidated  statements of income,  changes in shareholders'  equity,  and cash
flows for each of the three years in the period ended  December 31, 1997.  These
consolidated  financial  statements  are  the  responsibility  of the  Company's
management.  Our  responsibility is to express an opinion on these  consolidated
financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion the financial statements referred to above present fairly, in all
material  respects,  the consolidated  financial  position of Bull & Bear Group,
Inc.  and  subsidiaries  at  December  31, 1997 and 1996,  and the  consolidated
results of their  operations and their  consolidated  cash flows for each of the
three years in the period ended December 31, 1997, in conformity  with generally
accepted accounting principles.





                                              TAIT, WELLER & BAKER

PHILADELPHIA, PENNSYLVANIA
FEBRUARY 19, 1998



                                       13


<PAGE>



                             BULL & BEAR GROUP, INC.
                           CONSOLIDATED BALANCE SHEETS
                                  DECEMBER 31,

<TABLE>
<CAPTION>

                                                                                         1997              1996
                                                                                         ----              ----
                                                          ASSETS
Current Assets:
<S>                                                                               <C>                <C>
   Cash and cash equivalents                                                      $     312,633      $     747,444
   Marketable securities (Note 3)                                                     1,846,028          1,176,547
   Management, distribution and shareholder administration
      fees receivable                                                                   268,984            207,944
   Interest, dividends and other receivables                                            187,954            204,684
   Prepaid expenses and other current assets                                            411,821            289,712
                                                                                  -------------      -------------
      TOTAL CURRENT ASSETS                                                            3,027,420          2,626,331
                                                                                  -------------      -------------
REAL ESTATE HELD FOR INVESTMENT, NET                                                    632,682            438,187
EQUIPMENT, FURNITURE AND FIXTURES, NET                                                  196,416            237,851
EXCESS OF COST OVER NET BOOK VALUE OF SUBSIDIARIES, NET (Note 2)                        727,373            765,665
OTHER ASSETS                                                                            243,183            205,076
                                                                                  -------------      -------------
                                                                                      1,799,654          1,646,779
                                                                                  -------------      -------------
      TOTAL ASSETS                                                                $   4,827,074      $   4,273,110
                                                                                  =============      =============

                                       LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
   Accounts payable                                                               $     160,849      $     134,544
   Accrued professional fees                                                             93,335             81,285
   Accrued payroll and other related costs                                               41,042             53,012
   Accrued other expenses                                                                45,225             40,388
   Current portion of capitalized lease obligation (Note 4)                              13,644             12,282
   Other current liabilities                                                             10,408             11,620
                                                                                  -------------      -------------
      TOTAL CURRENT LIABILITIES                                                         364,503            333,131
                                                                                  -------------      -------------
CAPITALIZED LEASE OBLIGATION (Note 4)                                                     7,460             22,093
                                                                                  -------------      -------------
CONTINGENCIES (Note 11)                                                                     -                   -
SHAREHOLDERS'  EQUITY (Notes 3, 5, 6, and 7) Common Stock,  $.01 par value Class
   A, 10,000,000 shares authorized;
      1,350,017 shares issued and outstanding                                           13,501               13,501
   Class B, 20,000 shares authorized;
      20,000 shares issued and outstanding                                                 200                  200
   Additional paid-in capital                                                         6,236,077          6,236,077
   Retained earnings (deficit)                                                       (1,836,753)         (2,462,478)
   Unrealized gains on marketable securities                                             42,086            130,586
                                                                                  -------------      -------------
      TOTAL SHAREHOLDERS' EQUITY                                                      4,455,111          3,917,886
                                                                                  -------------      -------------
      TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                  $   4,827,074      $   4,273,110
                                                                                  =============      =============
</TABLE>

SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

                                       14


<PAGE>



                                                  BULL & BEAR GROUP, INC.

                                             CONSOLIDATED STATEMENTS OF INCOME

                                                 YEARS ENDED DECEMBER 31,

<TABLE>
<CAPTION>

                                                                1997             1996             1995
                                                                ----             ----             ----
REVENUES:
   Management, distribution and shareholder
<S>                                                       <C>               <C>               <C>
       administration fees                                $   4,313,947     $  4,922,945      $  3,322,348
   Brokerage commissions and fees                             2,452,272        2,351,983         1,821,513
   Realized gains from investments                               83,608           22,092               -
   Dividends, interest and other                                137,590          119,992           147,169
                                                          -------------     ------------      ------------
                                                              6,987,417        7,417,012         5,291,030
                                                          -------------     ------------      ------------

EXPENSES:
   General and administrative                                 3,287,781        3,504,317         2,924,882
   Marketing                                                  1,081,050        1,821,297           779,026
   Clearing and brokerage charges                               621,412          708,535           576,096
   Expense reimbursements to the Funds (Note 10)                615,743          535,902           270,233
   Subadvisory fees                                             387,593          705,248            22,496
   Professional fees                                            201,417          296,874           431,934
   Amortization and depreciation                                131,992          138,116            97,399
                                                          -------------     ------------      ------------
                                                              6,326,988        7,710,289         5,102,066
                                                          -------------     ------------      ------------

Income (loss) before income taxes                               660,429         (293,277)          188,964
Income taxes (Note 9)                                            34,704           27,248            32,588
                                                          -------------     ------------      ------------
NET INCOME (LOSS)                                         $     625,725     $   (320,525)     $    156,376
                                                          =============     ============      ============


PER SHARE DATA:
   Basic                                                        $.46            $(.23)             $.10
                                                                ====            =====              ====
   Diluted                                                      $.43            $(.23)             $.10
                                                                ====            =====              ====

AVERAGE SHARES OUTSTANDING:
   Basic                                                      1,370,017        1,369,555         1,499,516
                                                              =========        =========         =========
   Diluted                                                    1,468,252        1,369,555         1,549,815
                                                              =========        =========         =========
</TABLE>





SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

                                       15


<PAGE>


<TABLE>
<CAPTION>

                                                                     BULL & BEAR GROUP, INC.

                                                   CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

                                                          YEARS ENDED DECEMBER 31, 1997, 1996 AND 1995



                              NUMBER OF SHARES    AMOUNT
                                                                                  NOTES
                                                                                  RECEIVABLE
                                                                                  FOR                    UNREALIZED
                                                                      ADDITIONAL  COMMON      RETAINED   GAINS ON      TOTAL
                              CLASS A   CLASS B   CLASS A   CLASS B   PAID-IN     STOCK       EARNINGS   MARKETABLE    SHAREHOLDERS'
                              COMMON    COMMON    COMMON    COMMON    CAPITAL     ISSUED      (DEFICIT)  SECURITIES    EQUITY
                              ------    ------    ------    ------    ----------  ----------  ---------  ----------    -------------

<S>                           <C>        <C>       <C>        <C>     <C>         <C>        <C>            <C>         <C>
BALANCE, DECEMBER 31, 1994   1,503,152  20,000    $15,032    $200    $6,497,796  $(305,000) $(2,298,329)   $  -        $3,909,699

Voiding of 1993 exercise of
stock options and
cancellation of notes
receivable (Note 7)         (280,000)      -      (2,800)      -     (297,200)     300,000       -            -             -
Issuance of Class A common
stock on exercise
of stock options             274,020       -       2,740       -      291,280         -          -            -          294,020
Received in exchange for
exercise of stock options   (149,155)      -      (1,491)      -     (259,529)        -          -            -         (261,020)
Collection of note receivable   -          -          -        -          -         5,000        -            -            5,000
Net income                      -          -          -        -          -           -      156,376          -          156,376
Unrealized gains on
marketable securities           -          -          -        -          -           -          -          66,020        66,020
                             ------------------------------------------------ ------------------------------------------------------
BALANCE, DECEMBER 31, 1995  1,348,017    20,000    13,481     200    6,232,347        -    (2,141,953)      66,020     4,170,095

Issuance of Class A common
stock on exercise
of stock options              2,000        -          20       -         3,730        -          -            -            3,750
Net loss                        -          -          -        -           -          -      (320,525)        -         (320,525)
Unrealized gains on
marketable securities           -          -          -        -           -          -          -          64,566         64,566
                           --------------------------------------------------------------------------------------------------------
BALANCE, DECEMBER 31, 1996 1,350,017    20,000     13,501     200     6,236,077       -     (2,462,478)    130,586      3,917,886

Net income                      -          -          -        -           -          -        625,725        -          625,725
Unrealized losses on
marketable securities           -          -          -        -           -          -           -        (88,500)      (88,500)
                          ----------------------------------------------------------------------------------------------------------
BALANCE, DECEMBER 31, 1997 1,350,017    20,000     $13,501   $200    $6,236,077$      -    $(1,836,753)    $  42,086    $4,455,111
                           =========    ======     =======   ====    ===================================== =========    ==========

</TABLE>


SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.



                                       16


<PAGE>



                                                  BULL & BEAR GROUP, INC.

                                           CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                 YEARS ENDED DECEMBER 31,

<TABLE>
<CAPTION>

                                                                          1997           1996              1995
                                                                          ----           ----              ----
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                  <C>             <C>             <C>
   NET INCOME (LOSS)                                                 $    625,725    $   (320,525)   $      156,376
                                                                     ------------    ------------    --------------
   ADJUSTMENTS TO RECONCILE NET INCOME (LOSS)
      TO NET CASH PROVIDED BY (USED IN)
      OPERATING ACTIVITIES:
      Depreciation and amortization                                       131,992         138,116           97,399
      Increase in cash value of life insurance                            (32,333)        (30,000)          (30,000)
      Realized/unrealized (gain) loss on investments                      (83,608)        (32,725)          (26,048)
      (Increase) decrease in:
         Management, distribution and shareholder
            administration fees receivable                                (61,040)        (28,735)          (18,642)
         Interest, dividends and other receivables                         16,730         43,557            (32,387)
         Prepaid expenses and other current assets                       (122,109)       143,858           (199,301)
         Other assets                                                      (5,774)        (48,401)          12,802
      Increase (decrease) in:
         Accounts payable                                                  26,305        (475,698)         412,719
         Accrued expenses                                                   4,917          4,610            51,156
         Other current liabilities                                         (1,212)         (1,760)             (720)
                                                                     ------------    ------------    --------------
   TOTAL ADJUSTMENTS                                                     (126,132)       (287,178)         266,978
                                                                     ------------    ------------    -------------
      NET CASH PROVIDED BY (USED IN)
         OPERATING ACTIVITIES                                             499,593        (607,703)         423,354
                                                                     ------------    ------------    -------------

</TABLE>



                                       17


<PAGE>



                                               BULL & BEAR GROUP, INC.

                                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                     (Continued)

                                              YEARS ENDED DECEMBER 31,

<TABLE>
<CAPTION>

                                                                           1997           1996              1995
                                                                           ----           ----              ----
CASH FLOWS FROM INVESTING ACTIVITIES:
<S>                                                                <C>               <C>             <C>
   Improvement to real estate held for investment                  $     (218,956)   $   (204,642)   $       (2,105)
   Capital expenditures                                                   (27,804)       (100,799)          (58,744)
   Proceeds from sale of Bull & Bear Properties, Inc.                         -           43,763                -
   Proceeds from sales of investments                                     556,831        963,318           414,790
   Purchases of investments                                            (1,231,204)       (785,512)       (1,396,250)
   Acquisition of intangible assets                                           -           (66,780)         (267,411)
                                                                   --------------    ------------    --------------
      NET CASH USED IN INVESTING ACTIVITIES                              (921,133)       (150,652)       (1,309,720)
                                                                   --------------    ------------    --------------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Collection of note receivable                                              -               -              5,000
   Increase in capitalized lease obligation                                   -           46,416                -
   Repayments of capitalized lease obligation                             (13,271)        (12,041)              -
   Proceeds from issuance of Class A Common Stock                             -            3,750            33,000
                                                                   --------------    -----------     -------------
      NET CASH PROVIDED BY (USED IN)
         FINANCING ACTIVITIES                                             (13,271)        38,125            38,000
                                                                   --------------    -----------     -------------

      NET DECREASE IN CASH AND CASH EQUIVALENTS                          (434,811)       (720,230)         (848,366)

CASH AND CASH EQUIVALENTS:
   Beginning of year                                                      747,444      1,467,674         2,316,040
                                                                   --------------    -----------     -------------
   END OF YEAR                                                     $      312,633    $   747,444     $   1,467,674
                                                                   ==============    ===========     =============
</TABLE>


SUPPLEMENTAL DISCLOSURE:

   The Company did not pay any Federal income taxes in 1997, 1996 or 1995.

   The Company paid $916 and $1,309 in interest in 1997 and 1996 and no interest
in 1995.

   Common stock  received and retired in exchange for exercise of stock  options
was $261,020 in 1995.



SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.

                                       18


<PAGE>



                             BULL & BEAR GROUP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 1997, 1996 AND 1995


1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         NATURE OF BUSINESS
         Bull  &  Bear  Group,  Inc.  ("Company")  is  a  holding  company.  Its
         subsidiaries'  business  consists of providing  investment  management,
         distribution  and  shareholder  administration  services for the Bull &
         Bear  Funds,  Midas  Fund and  Rockwood  Fund  ("Funds")  and  discount
         brokerage services.

         BASIS OF PRESENTATION
         The  consolidated  financial  statements  include  the  accounts of the
         Company and all of its  subsidiaries.  Substantially  all  intercompany
         accounts and transactions have been eliminated.

         ACCOUNTING ESTIMATES
         In preparing financial statements in conformity with generally accepted
         accounting principles,  management makes estimates and assumptions that
         affect the reported  amounts of assets and  liabilities  at the date of
         the financial  statements,  as well as the reported amounts of revenues
         and expenses during the reported period.
         Actual results could differ from those estimates.

         FAIR VALUE OF FINANCIAL INSTRUMENTS
         The carrying amounts of cash and cash equivalents, accounts receivable,
         accounts   payable,   and  accrued   expenses  and  other   liabilities
         approximate  fair value  because of the short  maturity of these items.
         Marketable securities are recorded at market value which represents the
         fair value of the securities.

         CASH AND CASH EQUIVALENTS
         Investments   in  money  market  funds  are   considered   to  be  cash
         equivalents.   At  December   31,  1997  and  1996,   the  Company  and
         subsidiaries   had  invested   approximately   $260,300  and  $657,500,
         respectively, in an affiliated money market fund.

         MARKETABLE SECURITIES
         The  Company  and  its   non-broker/dealer   subsidiaries'   marketable
         securities are considered to be  "available-for-  sale" and recorded at
         market   value,   with  the   unrealized   gain  or  loss  included  in
         stockholders'  equity.  Marketable  securities  for  the  broker/dealer
         subsidiaries  are  valued at market  with  unrealized  gains and losses
         included in earnings.

         FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK
         In the normal  course of business,  the Company's  customer  activities
         involve the execution and  settlement of customer  transactions.  These
         activities  may  expose  the  Company  to risk of loss in the event the
         customer is unable to fulfill its contracted obligations, in which case
         the  Company  may have to purchase  or sell  financial  instruments  at
         prevailing  market  prices.  Any loss  from  such  transactions  is not
         expected  to  have  a  material  effect  on  the  Company's   financial
         statements.




                                       19


<PAGE>



                             BULL & BEAR GROUP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

                        DECEMBER 31, 1997, 1996 AND 1995


         BROKERAGE INCOME AND EXPENSES
         Brokerage commission and fee income and clearing and brokerage expenses
         are  recorded  on a  settlement  date  basis.  The  difference  between
         recording  such  income  and  expenses  on a  settlement  date basis as
         opposed to trade date,  as required by  generally  accepted  accounting
         principles, is not material to the consolidated financial statements.

         INCOME TAXES
         The Company and its wholly-owned  subsidiaries file consolidated income
         tax  returns.  The  Company's  method of  accounting  for income  taxes
         conforms  to  Statement  of  Financial  Accounting  Standards  No.  109
         "Accounting  for Income Taxes." This method requires the recognition of
         deferred  tax  assets  and  liabilities  for the  expected  future  tax
         consequences of temporary  differences  between the financial reporting
         basis and the tax basis of assets and liabilities.

         REAL ESTATE HELD FOR INVESTMENT AND EQUIPMENT
         Real estate held for  investment is recorded at cost and is depreciated
         on the straight-line  basis over its estimated useful life. At December
         31, 1997 and 1996,  accumulated  depreciation amounted to approximately
         $51,600 and $27,400,  respectively.  Equipment,  furniture and fixtures
         are recorded at cost and are  depreciated  on the  straight-line  basis
         over their estimated  useful lives, 3 to 10 years. At December 31, 1997
         and 1996,  accumulated  depreciation amounted to approximately $818,900
         and $749,300, respectively.

         EXCESS OF COST OVER NET BOOK VALUE OF SUBSIDIARIES
         The excess of cost over net book value of  subsidiaries  is capitalized
         and  amortized  over  fifteen and forty  years using the  straight-line
         method.  At  December  31,  1997  and  1996,  accumulated  amortization
         amounted  to   approximately   $623,400  and  $585,100,   respectively.
         Periodically,  the Company reviews its intangible  assets for events or
         changes in circumstances that may indicate that the carrying amounts of
         the assets are not recoverable.

         EARNINGS PER SHARE
         The Company adopted Statement of Financial Accounting Standards No. 128
         "Earnings Per Share" in 1997. The earnings per share for 1996 and 1995
         have been restated to conform to the provisions of this statement.
         Basic earnings per share is computed using the weighted average number
         of shares outstanding.   Diluted
         earnings  per share is computed  using the weighted  average  number of
         shares  outstanding  adjusted for the incremental  shares attributed to
         outstanding options to purchase common stock.





                                       20


<PAGE>



                             BULL & BEAR GROUP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

                        DECEMBER 31, 1997, 1996 AND 1995


         The  following  table sets forth the  computation  of basic and diluted
earnings per share:

                                          1997          1996           1995
                                          ----          ----           ----
Numerator for basic and diluted
earnings per share:
  Net income (loss)                 $   625,725   $  (320,525)    $   156,376
                                    ===========   ============    ===========

Denominator:
  Denominator for basic earnings
  per share weighted-average shares   1,370,017     1,369,555       1,499,516
  Effect of dilutive securities:
  Employee Stock Options                 98,235          -             50,299
                                   ------------   ------------    -----------

Denominator for diluted earnings
  per share adjusted weighted
  average shares and assumed
  conversions                         1,468,252     1,369,555       1,549,815
                                    ===========    ===========     ===========

         RECLASSIFICATIONS
         Certain  reclassifications  of the 1996 and 1995  financial  statements
         have been made to conform to the 1997 presentation.


2.    ACQUISITION

      During  the year  ended  December  31,  1996,  the  Company  acquired  the
      management of Rockwood Fund for approximately  $31,300.  This purchase was
      capitalized  as part of excess  of cost  over net book  value and is being
      amortized over 15 years using the straight-line method.

      During the year ended December 31, 1995, the Company  purchased the assets
      relating to the management of Midas Fund, Inc. for $182,500,  plus related
      costs  of  approximately   $84,900.  In  addition,  the  Company  expended
      approximately  $35,500 in  connection  with this  purchase  in 1996.  This
      purchase was capitalized as part of excess of cost over net book value and
      is being amortized over 15 years using the straight-line method.




                                       21


<PAGE>



                             BULL & BEAR GROUP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

                        DECEMBER 31, 1997, 1996 AND 1995


3.    MARKETABLE SECURITIES

At December 31, 1997, marketable securities consisted of:
 Broker/dealer securities - at market
   U.S. Treasury Notes, due 6/30/99 - 9/30/00 (cost $1,260,380)    $1,265,943
                                                                    ----------
 Other companies
   Available-for-sale securities - at market
     Unaffiliated mutual funds                                         36,324
     Affiliated mutual funds                                            3,157
     Equity securities                                                186,884
     U.S. Treasury Notes, due 9/30/00                                 353,720
                                                                 ------------
     Total available-for-sale securities (cost - $537,999)            580,085
                                                                 ------------
                                                                   $1,846,028

At December 31, 1996, marketable securities consisted of:
  Broker/dealer securities - at market
     U.S. Treasury Notes, due 5/15/97 - 6/30/99 (cost $956,925)   $   961,000
                                                                  -----------

  Other companies
     Available-for-sale securities - at market
       Unaffiliated mutual funds                                       37,251
       Affiliated mutual funds                                          7,662
       Equity securities                                              170,634
                                                                 ------------
   Total available-for-sale securities (cost - $84,961)               215,547
                                                                 ------------
                                                                   $1,176,547

      At  December  31, 1997 and 1996,  the  Company  had $42,086 and  $130,586,
      respectively, of unrealized gains on "available-for-sale securities" which
      is reported as a separate component of consolidated shareholders' equity.


4.    LEASE COMMITMENTS

      The Company  has a lease for  approximately  11,400  square feet of office
      space. The rent is approximately $144,000 per annum plus $32,550 per annum
      for electricity.  The lease expires December 31, 1998 and is cancelable at
      the option of the  Company  on three  months'  notice.  In  addition,  the
      Company's  discount  broker/dealer  has a  branch  office  in Boca  Raton,
      Florida  consisting  of  approximately  2,000  square  feet.  The  rent is
      approximately $55,000 per annum and expires on August 30, 1999.




                                       22


<PAGE>



                             BULL & BEAR GROUP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

                        DECEMBER 31, 1997, 1996 AND 1995


      The Company leases office equipment under capital leases expiring in 1999.
      The related  property is included in furniture  and equipment at a cost of
      $45,457 at December  31,  1997.  Depreciation  expense of $29,042 has been
      recognized on this property as of December 31, 1997. Future annual minimum
      lease payments under the capital leases together with the present value of
      the net minimum lease payments are as follows:

   YEAR ENDING DECEMBER 31,
      1998                                                             $14,188
      1999                                                               7,586
                                                                     ---------
      Total minimum lease payments                                      21,774
      Less amount representing interest and executory costs                670
                                                                    ----------
      Present value of minimum lease payments                        $  21,104
                                                                     =========


5.    SHAREHOLDERS' EQUITY

      The Class A and Class B Common Stock are identical in all respects  except
      for voting  rights,  which are vested  solely in the Class B Common Stock.
      The Company also has 1,000,000 shares of Preferred Stock,  $.01 par value,
      authorized.  As of December 31, 1997 and 1996, none of the Preferred Stock
      was issued.


6.    NET CAPITAL REQUIREMENTS

      The Company's broker/dealer  subsidiaries are member firms of the National
      Association  of  Securities  Dealers,  Inc.  and are  registered  with the
      Securities and Exchange  Commission as  broker/dealers.  Under the Uniform
      Net Capital Rule (Rule 15c3-1 under the Securities  Exchange Act of 1934),
      a broker/dealer must maintain minimum net capital, as defined, of not less
      than (a) $250,000 or, when engaged solely in the sale of redeemable shares
      of registered  investment  companies,  $25,000, or (b) 6-2/3% of aggregate
      indebtedness,  whichever is greater; and a ratio of aggregate indebtedness
      to net  capital,  as defined,  of not more than 15 to 1. At  December  31,
      1997, these  subsidiaries  had net capital of  approximately  $553,700 and
      $614,900;  net capital  requirements  of $250,000 and $25,000;  excess net
      capital  of  approximately  $303,700  and  $589,900;  and  the  ratios  of
      aggregate  indebtedness to net capital were approximately .45 to 1 and .28
      to 1, respectively.





                                       23


<PAGE>



                             BULL & BEAR GROUP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

                        DECEMBER 31, 1997, 1996 AND 1995


7.    STOCK OPTIONS

      On December 6, 1995, the Company adopted a Long-Term  Incentive Plan which
      provides  for the  granting  of a maximum of 300,000  options to  purchase
      Class A Common  Stock to  directors,  officers  and key  employees  of the
      Company or its subsidiaries.  The plan was amended on February 5, 1996 and
      October 29, 1997 increasing the maximum number of options to 450,000. With
      respect to  non-employee  directors,  only grants of  non-qualified  stock
      options and awards of  restricted  shares are  available.  The current two
      non-employee  directors  were granted  10,000  options each on December 6,
      1995 and 5,000  options  each on October 29,  1997.  The option  price per
      share may not be less than the fair  value of such  shares on the date the
      option is granted,  and the  maximum  term of an option may not exceed ten
      years except as to  non-employee  directors  for which the maximum term is
      five years. If the recipient of any option owns 10% or more of the Class B
      shares,  the option  price must be at least 110% of the fair market  value
      and the option must be exercised  within five years of the date the option
      is granted.

      The 1990  Incentive  Stock  Option  Plan  provided  for the  granting of a
      maximum of 500,000  options to purchase Class A Common Stock to directors,
      officers and key employees of the Company.  The option price per share may
      not be less than the greater of 100% of the fair  market  value or the par
      value of such  shares on the date the option is  granted,  and the maximum
      term of an option may not exceed ten years. If the recipient of any option
      owns 10% or more of the total  combined  voting  power of all  classes  of
      stock, the option price must be at least 110% of the fair market value and
      the option must be  exercised  within five years of the date the option is
      granted.

      The  Company  applied  APB  Opinion  25  and  related  interpretations  in
      accounting for its stock option plans.  Accordingly,  no compensation cost
      has been recognized for its stock option plans. Proforma compensation cost
      for the Company's plans is required by Financial  Accounting Standards No.
      123  "Accounting  for  Stock-Based  Compensation  (SFAS 123)" and has been
      determined  based on the fair value at the grant  dates for  awards  under
      these  plans  consistent  with the  method of SFAS 123.  For  purposes  of
      proforma disclosure,  the estimated fair value of the options is amortized
      to expense  over the  options'  vesting  period.  The  Company's  proforma
      information follows:

                                                 YEARS ENDED DECEMBER 31,
                                                 1997              1996
                                                 ----              ----
  Net income (loss):          As Reported       $625,725         $(320,525)
                              Proforma          $246,394         $(463,738)
  Earnings per share
     Basic                    As Reported       $.46             $(.23)
                              Proforma          $.18             $(.34)
     Diluted                  As Reported       $.43             $(.23)
                              Proforma          $.17             $(.34)

      The fair  value of each  option  grant is  estimated  on the date of grant
      using the Black-Scholes  option-pricing  model with the following weighted
      average  assumptions  used  for  grants  in 1997 and  1996,  respectively:
      expected volatility of 92.83% and 93.82%, risk-free interest rate of 5.85%
      and 5.29% and expected life of three years and five years.



                                       24


<PAGE>



                             BULL & BEAR GROUP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

                        DECEMBER 31, 1997, 1996 AND 1995


      A summary of the status of the Company's stock option plans as of December
      31, 1997 and 1996,  and changes  during the years ending on those dates is
      presented below:

                                                             WEIGHTED
                                           NUMBER           AVERAGE
                                             OF            EXERCISE
 STOCK OPTIONS                             SHARES           PRICE
 -------------                            --------       --------
 OUTSTANDING AT DECEMBER 31, 1995          49,000            $1.76
    Granted                                229,000           $2.04
    Exercised                               (2,000)          $1.88
    Canceled                               (27,000)          $1.91
                                          --------
 OUTSTANDING AT DECEMBER 31, 1996         249,000            $2.00
    Granted                               167,000            $2.53
    Canceled                               (34,000)          $1.97
                                          --------
 OUTSTANDING AT DECEMBER 31, 1997         382,000            $2.23
                                          =======

      There  were  146,000  options  exercisable  at  December  31,  1997 with a
       weighted-average   exercise  price  of  $2.37.   There  were  no  options
       exercisable  at December 31,  1996.  The  weighted-average  fair value of
       options granted
      was $1.41 and $1.42 for the years ended December 31, 1997 and 1996,
      respectively.

      The following table summarizes information about stock options outstanding
at December 31, 1997:

                                                  OPTIONS OUTSTANDING

                                      WEIGHTED-AVERAGE
       RANGE OF         NUMBER            REMAINING          WEIGHTED-AVERAGE
  EXERCISE PRICES     OUTSTANDING     CONTRACTUAL LIFE        EXERCISE PRICE
  ---------------     -----------    -------------------    ------------------
  $1.50   - $1.625        15,000           2.0 years               $1.52
  $1.875 - $2.475        334,000           3.8 years               $2.20
  $2.75   - $3.00         33,000           4.0 years               $2.92

      In addition, there were 30,000 non-qualified stock options with a range of
      exercise  prices  of  $1.75  - $2.25  outstanding  and  exercisable  as of
      December 31, 1997.


PENSION PLAN

      The  Company has a 401(k)  retirement  plan for  substantially  all of its
      qualified employees.  Contributions to this are based upon a percentage of
      earnings  of  eligible  employees  and are accrued and funded on a current
      basis.  Total pension  expense for the years ended December 31, 1997, 1996
      and 1995 was approximately $44,800, $39,900 and $31,100, respectively.





                                       25


<PAGE>



                             BULL & BEAR GROUP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

                        DECEMBER 31, 1997, 1996 AND 1995


9.    INCOME TAXES

      The provision for income taxes charged to operations was as follows:

                                       1997           1996          1995
                                       ----           ----          ----
   Current
      State and local                 $34,704       $27,248        $32,588
      Federal                            -              -             -
                                   ------------   ------------     ---------
                                      $34,704       $27,248        $32,588
                                      =======       =======        =======

      Deferred  tax assets  (liabilities)  are  comprised  of the  following  at
December 31, 1997 and 1996:

                                                   1997               1996
                                                   ----               ----
   Unrealized appreciation on investments     $   (16,200)       $   (45,800)
   Net operating loss carryforwards               277,100            509,500
                                                ----------         ----------
       Net deferred tax assets                    260,900            463,700
   Deferred tax asset valuation allowance        (260,900)          (463,700)
                                                ----------         -----------
       Net deferred tax assets                    $   -              $   -
                                                  ========           ========

      The full  amount  of the  deferred  tax asset  was  offset by a  valuation
      allowance due to uncertainties associated with the ultimate realization of
      the  net  operating  loss  carryforwards.  The  change  in  the  valuation
      allowance  for the year ended  December 31, 1997 was the result of the net
      income for the year and the  decrease in the  unrealized  appreciation  on
      investments.

      For the year ended  December  31,  1997,  the  provision  for income taxes
      differs  from the  amount of  income  taxes  determined  by  applying  the
      applicable U.S.  statutory federal tax rates to pre-tax income as a result
      of utilization of net operating loss carryforwards.

      At December 31, 1997, the Company had net operating loss carryforwards for
      Federal income tax purposes of approximately  $815,000, of which $298,600,
      $187,800,  $62,700  and  $265,900  expire  in 2004,  2005,  2006 and 2011,
      respectively.





                                       26


<PAGE>



                             BULL & BEAR GROUP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

                        DECEMBER 31, 1997, 1996 AND 1995


10.   RELATED PARTIES

      All management and  distribution  fees are from providing  services to the
      Funds.  All such  services are provided  pursuant to  agreements  that set
      forth the fees to be charged  for these  services.  These  agreements  are
      subject to annual  review and  approval by each Fund's  Board of Directors
      and  a  majority  of  the  Fund's  non-interested  directors.  Shareholder
      administration   fees  represent   reimbursement   of  costs  incurred  by
      subsidiaries  of the  Company  on  behalf  of  the  open-end  Funds.  Such
      reimbursement  amounted to approximately  $286,100,  $249,700 and $363,200
      for the years ended December 31, 1997, 1996 and 1995, respectively.

      In  connection  with  investment   management   services,   the  Company's
      investment managers waived management fees from the Funds in the amount of
      approximately $615,700, $535,900 and $270,200 for the years ended December
      31, 1997, 1996 and 1995, respectively.

      Certain officers of the Company also serve as officers and/or directors of
the Funds.

      Commencing August 1992, the Company has a key man life insurance policy on
      the life of the  Company's  Chairman  which  provides  for the  payment of
      $1,000,000  to the Company upon his death.  As of December  31, 1997,  the
      policy  had a  cash  surrender  value  of  approximately  $109,000  and is
      included in other assets in the balance sheet.

      The Company's discount  broker/dealer  received  brokerage  commissions of
      approximately $259,400, $179,500 and $153,200 from the Funds for the years
      ended December 31, 1997, 1996 and 1995, respectively.






                                       27


<PAGE>



                             BULL & BEAR GROUP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Continued)

                        DECEMBER 31, 1997, 1996 AND 1995


11.   CONTINGENCIES

      The Company and its directors are defendants in a lawsuit brought on April
      24, 1995 by Maxus Investment Group,  Maxus Capital  Partners,  Maxus Asset
      Management, Inc., and Maxus Securities Corp. (collectively "Maxus"), which
      now claim to collectively own or control 144,000 shares,  or approximately
      10.7% of the Class A Common  stock of the  Company.  The  action,  seeking
      declaratory and injunctive relief, was filed in the federal district court
      for the  Southern  District of New York and  purports to be brought on the
      plaintiffs' own behalf and derivatively on behalf of the Company. On April
      11,  1996,  the  district  court  dismissed  as a matter of law all claims
      brought by the  plaintiffs  except  those  relating to the voiding of 1993
      exercises,  the  exercise of certain  1990 stock  options and  plaintiffs'
      request for attorneys' fees from the Company.  Defendants thereafter filed
      answers  denying  liability.  The  Company  believes  that the  lawsuit is
      without  merit and  intends to continue  defending  the  remaining  claims
      vigorously.

      Although a group called Karpus Investment  Management  ("KIM")  previously
      failed to elect its slate of nominees in  opposition  to management at the
      1997  annual  meeting  of  stockholders  of  Bull & Bear  U.S.  Government
      Securities Fund, Inc. ("BBG"),  a closed-end fund managed by BBAI, another
      BBG annual  meeting is scheduled  for 1998.  In addition,  on February 19,
      1998, BBG filed a lawsuit  against KIM in the United States District Court
      for the  Southern  District  of New York,  98 Civ.  1190,  and KIM filed a
      lawsuit  against BBG in the Circuit  Court for Baltimore  City,  Maryland,
      Case No.  9805005.  The outcome of these  matters and their  effect on the
      Company or BBAI's  management  agreement with BBG cannot be predicted with
      certainty.

      From time to time, the Company and/or its  subsidiaries  are threatened or
      named  as  defendants  in  litigation  arising  in the  normal  course  of
      business.  As of  December  31,  1997,  neither the Company nor any of its
      subsidiaries  was involved in any other litigation that, in the opinion of
      management,  would  have a  material  adverse  impact on the  consolidated
      financial statements.

      In  July  1994,  the  Company  entered  into  a  Death  Benefit  Agreement
      ("Agreement")  with the  Company's  Chairman.  Following  his  death,  the
      Agreement  provides for annual payments equal to 80% of his average annual
      salary for the three  year  period  prior to his death  subject to certain
      adjustments to his wife until her death. The Company's  obligations  under
      the  Agreement  are not  secured  and  will  terminate  if he  leaves  the
      Company's employ under certain conditions.




                                       28



<PAGE>



<TABLE>
<CAPTION>

                                       SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)


                                                                   THREE MONTHS ENDED
                                                    MARCH 31,          JUNE 30,       SEPT. 30,          DEC. 31,
   1997
<S>                                                <C>               <C>              <C>               <C>
REVENUES                                           $1,911,891        $1,765,995       $1,684,132        $1,625,399
                                                   ==========        ==========       ==========        ==========
INCOME
   Net Income                                      $   115,655       $   163,587     $   215,744       $   130,739
                                                   ===========       ===========     ===========       ===========

INCOME PER SHARE
   Net Income                                             $.08              $.12             $.16             $.10
                                                          ====              ====             ====             ====


   1996
REVENUES                                           $1,526,469        $2,054,758       $1,904,869        $1,930,916
                                                   ==========        ==========       ==========        ==========
INCOME (LOSS)
   Net Income (Loss)                               $  (418,274)      $  (199,710)    $   134,673       $   162,786
                                                   ===========       ===========     ===========       ===========

INCOME (LOSS) PER SHARE
   Net Income (Loss)                                     $(.30)            $(.13)            $.09             $.12
                                                         =====             =====             ====             ====


   1995
REVENUES                                           $1,292,575        $1,323,620       $1,362,963        $1,311,872
                                                   ==========        ==========       ==========        ==========

INCOME (LOSS)
   Net Income (Loss)                              $   113,764       $   115,490     $     50,894        $  (123,772)
                                                  ===========       ===========     ============        ===========

INCOME (LOSS) PER SHARE
   Net Income (Loss)                                     $.07              $.07             $.03          $(.07)
                                                         ====              ====             ====          =====
</TABLE>


ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

      There were no changes in or disagreements  with the Company's  accountants
on  accounting  and  financial  disclosure  matters  during the two years  ended
December 31, 1997.



                                       29


<PAGE>



                                    PART III


ITEM 10.     DIRECTORS AND EXECUTIVE OFFICERS

      The  following  list  contains the names,  ages,  positions and lengths of
service of all directors and executive officers of the Company.

      NAME              POSITION                    YEARS OF SERVICE        AGE
                                                    DIRECTOR   OFFICER

Bassett S. Winmill      Chairman of the Board         21         21          68

Robert D. Anderson      Vice Chairman of the Board    21         21          68

Mark C. Winmill         Co-President,                 9          11          40
                        Chief Financial Officer,
                        Director

Thomas B. Winmill, Esq. Co-President,                 9          10          38
                        General Counsel, Director

Edward G. Webb, Jr.     Director                      12*         -          58

Charles A. Carroll      Director                      6           -          67

Steven A. Landis        Senior Vice President         -           3          42

James R. Mitchell, II   Senior Vice President         -           4          36

Joseph Leung            Treasurer,                    -           3          32
                        Chief Accounting Officer

Deborah Ann Sullivan    Vice President,
                        Secretary                     -           1          28

*  1985 TO 1990 AND 1992 TO PRESENT.




                                       30


<PAGE>





      Set  forth  below  is a  description  of the  business  experience  of the
directors and executive officers of the Company during the past five years.

      BASSETT S. WINMILL - Chairman of the Board of Directors.  He is also
      Chairman of certain investment companies managed by Company subsidiaries.
      He is a member of the New York Society of Security Analysts, the
      Association for Investment Management and Research, and the International
      Society of Financial Analysts.

      ROBERT D. ANDERSON - Vice Chairman of the Board of Directors.   He is also
      Vice Chairman of certain investment companies managed by Company
      subsidiaries and of the subsidiaries of the Company.

      MARK C. WINMILL - Co-President, Chief Financial Officer and Director.   He
      is also President of Bull & Bear Securities, Inc. and Co-President of the
      investment companies managed by Company subsidiaries and of certain other
      subsidiaries of the Company.   He is a son of Bassett S. Winmill and a
      brother of Thomas B. Winmill.

      THOMAS B. WINMILL, ESQ. - Co-President, General Counsel and Director.  He
      is also President of Bull & Bear Advisers, Inc. and Co-President of the
      investment companies managed by Company subsidiaries and of certain
      other subsidiaries of the Company.   He is a member of the New York State
      Bar. He is a son of Bassett S. Winmill and a brother of Mark C. Winmill.

      EDWARD G. WEBB, JR. - Director.  He has been President of Webb Associates,
      Ltd. since 1996. From 1990 to 1996, he was Investment Director for Home
      Insurance Company.   Prior to that, he served as a Senior Vice President
      and Director of the Company.

      CHARLES A. CARROLL - Director.   From 1989 to the present, he has been
      affiliated with Kalin Associates,
      Inc., a member firm of the New York Stock Exchange.

      STEVEN A. LANDIS - Senior Vice President. He is also Senior Vice President
of the investment companies managed by Company  subsidiaries.  From 1993 to 1995
he was  Associate  Director  of  Proprietary  Trading at  Barclays De Zoete Wedd
Securities,  Inc.,  from  1992 to 1993 he was  Director,  Bond  Arbitrage  at WG
Trading  Company,  and from 1989 to 1992 he was Vice President of Wilkinson Boyd
Capital Markets.

      JAMES R. MITCHELL, II - Senior Vice President.   He is also Senior Vice
      President of BBSI since 1994.
      From 1992 to 1994 he was Vice President of BBSI.

      JOSEPH LEUNG,  CPA - Treasurer and Chief  Accounting  Officer.  He is also
Treasurer and Chief Accounting  Officer of the investment  companies  managed by
Company subsidiaries. From 1992 to 1995 he held various positions with Coopers &
Lybrand  L.L.P.,  a  public  accounting  firm.  From  1991  to  1992  he was the
accounting supervisor at Retirement Systems Group, a mutual fund company.

      DEBORAH  ANN  SULLIVAN  - Vice  President,  Secretary.  She is  also  Vice
President  and  Secretary  of  the  investment   companies  managed  by  Company
subsidiaries.  From 1993 to 1994 she was a Blue Sky  Paralegal  for Sun  America
Asset  Management  Corporation  and from 1992  through  1993 she was  Compliance
Administrator  and Blue Sky  Administrator  with  Prudential Inc. and Prudential
Fund Management, Inc. She earned her Juris Doctor at Hofstra University,  School
of Law.

      Each director is elected by the vote or written consent of the holder of a
majority of the Class B Common  Stock and holds office until the next meeting of
the Class B common stockholder and until his successor is elected and qualified,
or until his earlier death, resignation or removal.






                                       31


<PAGE>



      Based  solely on the  information  from Forms 3, 4, and 5 furnished to it,
the Company  believes that the directors,  officers,  and owners of more than 10
percent of the Class A Common  Stock of the Company have filed on a timely basis
reports required by Section 16(a) of the Securities  Exchange Act of 1934 during
the most recent fiscal year or prior fiscal years except as follows:  Bassett S.
Winmill  with  respect  to  transactions  in April 1997 filed a Form 4 on May 5,
1997, and amendments  thereto on May 16, 1997 and March 24, 1998, and an amended
Form 5 on March 24, 1998.

      Based on  information  available to the  Company,  including a December 4,
1996 letter  from Maxus'  counsel,  Maxus (See Note 11) owns  144,000  shares or
10.7% of the outstanding Class A Common Stock of the Company. Such entities have
not  furnished  the  Company  with any form under  Section 16 of the  Securities
Exchange Act of 1934.


ITEM 11.     EXECUTIVE COMPENSATION

      The following  information and tables set forth the  information  required
under the Securities and Exchange Commission's executive compensation rules. Any
information  not presented is omitted  because the item is not applicable or not
required since the Company qualifies as a small business issuer.

SUMMARY COMPENSATION TABLE
      The  following  table sets forth,  for the three years ended  December 31,
1997,  the  compensation  paid to the  chief  executive  officers  and the other
executive  officers  whose total annual  salary and bonus  exceeded  $100,000 in
1997.

                           SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>

                                                  ANNUAL COMPENSATION                             ALL OTHER
     NAME AND                                   SALARY          BONUS        OTHER ANNUAL         COMPENSATION
PRINCIPAL POSITION                    YEAR        ($)            ($)         COMPENSATION*       (A)       (B)
------------------                    ----    ---------       ---------      ------------        ---       ---

<S>                                   <C>      <C>             <C>           <C>               <C>         <C>
Bassett S. Winmill                    1997     $170,000        $17,708            -            $5,166     $4,750
    Chairman                          1996     $170,000        $28,333            -            $5,166     $4,750
                                      1995     $160,000        $10,000            -            $4,788     $4,620
Robert D. Anderson                    1997    $  90,000       $  9,375            -            $2,142     $2,925
    Vice Chairman                     1996    $  90,000        $15,000            -            $2,142     $3,211
                                      1995    $  89,000       $  5,562            -            $2,104     $3,310
Mark C. Winmill                       1997     $122,500        $13,021            -           $   269     $3,941
    Co-President                      1996     $110,000        $18,115            -           $   152     $3,997
                                      1995     $100,000       $  6,250            -           $   132     $3,462
Thomas B. Winmill                     1997     $122,500        $13,021            -           $   177     $4,272
    Co-President                      1996     $110,000        $18,115            -           $   152     $4,066
                                      1995     $100,000       $  6,250            -           $   132     $3,678
Steven A. Landis                      1997     $120,667       $  7,542            -           $   267     $2,564
    Senior Vice President             1996     $112,000        $18,667            -           $   241     $1,750
                                      1995    $  86,167       $  8,250            -           $   150     $  -

</TABLE>

 *    Information omitted as perquisites do not exceed the lesser of $50,000 or
      10% of the total annual salary and bonus
      for the year for the named executive officers.

(A)   Represents term life insurance
(B) Represents Company's matching contributions to 401(k) Plan.



                                       32


<PAGE>



OPTION GRANTS TABLE
      The  following  table sets forth,  for the year ended  December  31, 1997,
information  regarding  the options  granted to each of the  executive  officers
named in the Summary Compensation Table.

<TABLE>
<CAPTION>

                                                                                       POTENTIAL REALIZABLE VALUE AT
                                                                                       ASSUMED ANNUAL RATES OF
                                                                                       STOCK PRICE APPRECIATION FOR
                                          INDIVIDUAL GRANTS                                    OPTION TERM
                               NUMBER OF    PERCENT OF
                              SECURITIES    TOTAL OPTIONS
                              UNDERLYING    GRANTED TO
                                OPTIONS     EMPLOYEES IN    EXERCISE     EXPIRATION
      NAME                      GRANTED     FISCAL YEAR     PRICE        DATE                5%           10%
      ----                    ------------------------------------------------------  ------------------------------

<S>                             <C>            <C>           <C>         <C>               <C>           <C>
Bassett S. Winmill              40,000         24.0          $2.475      10/29/02         $15,880       $45,960
Mark C. Winmill                 40,000         24.0          $2.475      10/29/02         $15,880       $45,960
Thomas B. Winmill               40,000         24.0          $2.475      10/29/02         $15,880       $45,960
Robert D. Anderson               5,000          3.0          $2.250      10/29/02        $  3,110      $  6,870

</TABLE>

      All of the above options are exercisable as of December 31, 1997.

AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUE TABLE
      The  following  table sets forth,  for the year ended  December  31, 1997,
information regarding the outstanding options for each of the executive officers
named in the Summary Compensation Table.

                                              NUMBER OF
                                              SECURITIES          VALUE OF
                                              UNDERLYING          UNEXERCISED
                      NUMBER OF               UNEXERCISED         IN-THE-MONEY
                      SHARES                  OPTIONS AT          OPTIONS AT
                      ACQUIRED   DOLLAR       12-31-97 (#)        12-31-97 ($)
                         ON      VALUE        EXERCISABLE/        EXERCISABLE/
NAME                  EXERCISE   REALIZED     UNEXERCISABLE       UNEXERCISABLE

Bassett S. Winmill       -          -         40,000/50,000      $21,000/$46,875
Mark C. Winmill          -          -         40,000/50,000      $21,000/$46,875
Thomas B. Winmill        -          -         40,000/50,000      $21,000/$46,875
Robert D. Anderson       -          -          5,000/20,000       $3,750/$22,500
Steven A. Landis         -          -              0/20,000           $0/$22,500

LONG-TERM INCENTIVE PLAN AWARDS TABLE
      There were no long-term  incentive  plan awards made during the year ended
December 31, 1997.

COMPENSATION OF DIRECTORS
      Edward G. Webb, Jr. and Charles A. Carroll were the only individuals who
received compensation for their service as directors of the Company in 1997.
They were each paid $500 per quarter as a retainer and $2,000 per quarterly
meeting attended plus expenses.   For the year ended December 31, 1997, Mr. Webb
and Mr. Carroll were each paid $10,000 for attending all four meetings.  Mr.
Webb and Mr. Carroll each also received an option to purchase
5,000 shares of Class A Common Stock at an exercise price of $2.25 per share.

EMPLOYMENT CONTRACTS
      The Company has no employment  or  termination  contracts  with any of its
employees  except to the  extent of the  agreement  described  in Note 11 to the
financial statements.

                                       33


<PAGE>



REPRICING OF OPTIONS TABLE
      During 1997, the Stock Option Committee  amended the exercise price on the
Stock  Options  issued to Mark C.  Winmill  and Thomas B.  Winmill in 1996.  The
exercise price on the stock options was increased to $2.0625 from $1.875.

1995 LONG-TERM INCENTIVE PLAN
      On December 6, 1995,  the Board of Directors of the Company  ("Board") and
the Class B voting common  stockholder  adopted the Bull & Bear Group, Inc. 1995
Long-Term  Incentive Plan ("Plan"),  under which options and stock-based  awards
(collectively, "Awards") may be made to directors, officers and employees of the
Company or its  subsidiaries.  The Plan was amended by the Board and the Class B
voting common  stockholder on February 5, 1996 and October 29, 1997. The amended
Plan is described below.

      The purpose of the Plan is to assist the Company and its  subsidiaries  in
attracting and retaining highly  competent  officers and directors and otherwise
on behalf of the  Company.  The Plan also  acts as an  incentive  in  motivating
selected  officers and key  employees  to achieve  long-term  objectives  of the
Company, which will inure to the benefit of all stockholders of the Company. Any
proceeds  raised by the Company under the Plan will be used for working  capital
purposes.

GENERAL PROVISIONS
      Duration of the Plan;  Share  Authorization.  The Plan will  terminate  on
December 6, 2005, unless terminated earlier by the Board.

      Four hundred fifty  thousand  (450,000)  shares of the  Company's  Class A
Common Stock  ("Shares")  are available for Awards under the Plan. The Shares to
be offered under the Plan are authorized and unissued  Shares,  or issued Shares
that have been  reacquired by the Company and held in its  treasury.  Holders of
Shares do not have voting rights except as specifically provided by the Delaware
General Corporation Law.

      Shares covered by any unexercised  portions of terminated options,  Shares
forfeited by  Participants,  and Shares subject to any Awards that are otherwise
surrendered by a Participant without receiving any payment or other benefit with
respect  thereto may again be subject to new Awards under the Plan. In the event
the purchase price of an option or tax withholding  relating to an Award is paid
in whole or in part  through  the  delivery  of  Shares,  the  number  of Shares
issuable  in  connection  with  the  exercise  of the  option  may not  again be
available for the grant of Awards under the Plan.

      Plan Administration. The Plan is administered by the Board or Stock Option
Committee  ("Committee") of the Board. The Committee is composed of at least two
directors of the Company,  each of whom is a "Non-Employee  Director" as defined
in Rule 16b-3  promulgated  by the SEC ("Rule  16b-3")  under  Section 16 of the
Securities Exchange Act of 1934, as amended ("Exchange Act"). When the Committee
is  administering  the Plan, the Committee will determine the officers and other
key employees who will be eligible for and granted Awards,  determine the amount
and type of Awards,  establish and modify  administrative  rules relating to the
Plan,  impose  such  conditions  and  restrictions  on Awards  as it  determines
appropriate  and take such other action as may be necessary or advisable for the
proper   administration  of  the  Plan.  The  Committee  may,  with  respect  to
Participants  who are not subject to Section 16 of the  Exchange  Act,  delegate
such of its  powers  and  authority  under the Plan as it deems  appropriate  to
certain officers or employees of the Company.

      Plan  Participants.  Any  employee  of the  Company  or its  subsidiaries,
whether or not a director of the  Company,  may be selected by the  Committee to
receive an Award  under the Plan.  Non-Employee  Directors  shall  receive  such
Awards (other than  Incentive  Stock Options) as the Board in its discretion may
designate.




                                       34



<PAGE>





AWARDS AVAILABLE UNDER THE PLAN
      Awards to employees  under the Plan may take the form of stock  options or
Restricted  Share  Awards.  Awards  under  the Plan may be  granted  alone or in
combination with other Awards.  The  consideration  for issuance of Awards under
the Plan is the continued  services of the employees and non-employee  directors
to the Company and its subsidiaries.

      Stock  Options  Granted to  Employees.  Stock  options  ("Incentive  Stock
Options")  meeting the  requirements of Section 422 of the Internal Revenue Code
of 1986, as amended from time to time, or any successor  thereto  ("Code"),  and
stock options that do not meet such requirements ("Non-Qualified Stock Options")
are both available for grant to employees under the Plan.

      The term of each option will be determined by the Committee, but no option
will be exercisable more than ten years after the date of grant. If, however, an
Incentive Stock Option is granted to a Participant  who, at the time of grant of
the  option,  owns (or is deemed to own under  Section  424(d) of the Code) more
than 10% (a "Ten Percent  Shareholder")  of the Company's  Class B common stock,
par value  $0.01 per share  ("Company  Voting  Securities"),  the  option is not
exercisable  more than five years  after the date of grant.  Options may also be
subject to restrictions on exercise,  such as exercise in periodic installments,
performance targets and waiting periods, as determined by the Committee.

      The exercise price of each option is determined by the Committee; however,
the per share  exercise price of an option must be at least equal to 100% of the
Fair  Market  Value (as  defined  below) of a Share on the date of grant of such
option.  If,  however,  an  Incentive  Stock  Option is granted to a Ten Percent
Shareholder,  the per share  exercise price of the option must be at least equal
to 110% of the Fair Market Value of a Share on the date of grant of such option.
Fair Market  Value of a Share  means,  as of any given date,  the most  recently
reported  sale  price of a Share on such date as of the time  when  Fair  Market
Value is being determined on the principal national securities exchange on which
the Shares are then  traded or, if the Shares are not then  traded on a national
securities exchange, the most recently reported sale price of the Shares on such
date as of the time  when  Fair  Market  Value is being  determined  on  Nasdaq;
provided,  however,  that, if there were no sales reported as of such date, Fair
Market Value is the last sale price previously reported. In the event the Shares
are not admitted to trade on a securities exchange or quoted on Nasdaq, the Fair
Market Value of a Share as of any given date is as  determined  in good faith by
the Committee.  Notwithstanding the foregoing,  the Fair Market Value of a Share
will never be less than par value per share.

      Subject to whatever installment exercise and waiting period provisions the
Committee  may impose,  options may be exercised in whole or in part at any time
prior to  expiration of the option by giving  written  notice of exercise to the
Company  specifying  the number of Shares to be  purchased.  Such notice must be
accompanied  by  payment  in  full of the  purchase  price  in such  form as the
Committee may accept  (including  payment in accordance with a cashless exercise
program under which, if so instructed by the  Participant,  Shares may be issued
directly  to the  Participant's  broker or dealer upon  receipt of the  purchase
price in cash from the broker or dealer). If and to the extent determined by the
Committee in its  discretion  at or after grant,  payment in full or in part may
also be made in the form of Shares duly owned by the Participant  (and for which
the Participant has good title, free and clear of any liens and encumbrances) or
by reduction in the number of Shares  issuable upon such exercise based, in each
case,  on the  Fair  Market  Value of the  Shares  on the  date  the  option  is
exercised.  In the case of an Incentive Stock Option, however, the right to make
payment of the purchase  price in the form of Shares may be  authorized  only at
the time of grant.

      Stock options granted under the Plan are not  transferable  except by will
or the  laws of  descent  and  distribution  and may be  exercised,  during  the
Participant's lifetime, only by the Participant.







                                       35



<PAGE>





      Unless  the  Committee  provides  for a  shorter  period  of time,  upon a
Participant's  termination  of  employment  other  than by  reason  of  death or
disability,  the  Participant  may,  within  three  months from the date of such
termination  of  employment,  exercise  all or any part of his or her options as
were  exercisable  at the date of  termination of employment but only if (x) the
Participant resigns or retires and the Committee consents to such resignation or
retirement and (y) such termination of employment is not for cause. In no event,
however,  may any  option be  exercised  after the time when it would  otherwise
expire. If such termination of employment is for cause or the Committee does not
so  consent,  the  right of such  Participant  to  exercise  such  options  will
terminate at the date of termination of employment.

      Further,  unless the Committee provides for a shorter period of time, upon
a Participant's  becoming disabled (such date being the "Disability  Date"), the
Participant  may, within one year after the Disability  Date,  exercise all or a
part of his or her options that were  exercisable  upon such Disability Date. In
no event,  however,  may any  option be  exercised  after the time when it would
otherwise expire.

      Further,  unless the Committee  provides for a shorter  period of time, in
the event of the death of a Participant  while  employed by the Company or prior
to the expiration of the option as provided for in the event of  disability,  to
the extent all or any part of the option was exercisable as of the date of death
of the Participant,  the right of the Participant's  beneficiary to exercise the
option  will  expire  upon  the  expiration  of one  year  from  the date of the
Participant's  death (but in no event more than one year from the  Participant's
Disability Date) or on the stated  termination date of the option,  whichever is
earlier. In the event of the Participant's death, the Committee may, in its sole
discretion,  accelerate  the right to exercise all or any part of an Option that
would not otherwise be exercisable.

      To the extent all or any part of an option was not  exercisable  as of the
date of a Participant's termination of employment, such right will expire at the
date of such  termination of  employment.  Notwithstanding  the  foregoing,  the
Committee,  in its sole discretion and under such terms as it deems appropriate,
may permit a Participant who will continue to render significant services to the
Company after his or her termination of employment to continue to accrue service
with  respect to the right to exercise  his or her options  during the period in
which the individual continues to render such services.

      Restricted Shares. The Committee may award restricted Shares  ("Restricted
Shares") to a Participant. Such a grant gives a Participant the right to receive
Shares  subject to a risk of  forfeiture  based  upon  certain  conditions.  The
forfeiture  restrictions on the Restricted  Shares may be based upon performance
standards,  length of service or other  criteria as the Committee may determine.
Until all  restrictions  are  satisfied,  lapsed or  waived,  the  Company  will
maintain control over the Restricted Shares but the Participant will be entitled
to receive  dividends on the  Restricted  Shares;  provided,  however,  that any
Shares  distributed  as a dividend or otherwise  with respect to any  Restricted
Shares as to which the  restrictions  have not yet lapsed will be subject to the
same  restrictions as such Restricted  Shares.  When all restrictions  have been
satisfied  and/or  waived  or have  lapsed,  the  Company  will  deliver  to the
Participant or, in the case of the Participant's  death, his or her beneficiary,
stock  certificates  for  the  appropriate   number  of  Shares,   free  of  all
restrictions (except those imposed by law). None of the Restricted Shares may be
assigned  or  transferred  (other  than  by  will or the  laws  of  descent  and
distribution),  pledged  or sold  prior to lapse or  release  of the  applicable
restrictions.

      All of a Participant's  Restricted Shares and rights thereto are forfeited
to the Company unless the Participant continues in the service of the Company or
any parent or subsidiary of the Company as an employee  until the  expiration of
the forfeiture period,  and all other applicable  restrictions of the Restricted
Shares.   Notwithstanding  the  foregoing,   the  Committee  may,  in  its  sole
discretion, waive the forfeiture period and any other applicable restrictions on
a Participant's  Restricted  Share Award,  provided that the Participant must at
that  time have  completed  at least  one year of  employment  after the date of
grant.



                                       36



<PAGE>



      Awards  Granted to  Non-Employee  Directors.  Non-Employee  Directors  are
eligible  only to receive  Non-Qualified  Stock Options and Awards of Restricted
Shares.  All such grants may be made only by the Board. The terms and conditions
applicable  to grants of such Awards to  Non-Employee  Directors  (except  where
specifically  stated herein to the contrary) are the same as those applicable to
grants of Non-Qualified Options and Restricted Shares to employees,  except that
references  to (a) the  Committee  shall be  deemed  to refer to the  Board  (b)
employees shall be deemed to refer to Non-Employee Directors and (c) termination
of employment shall be deemed to refer to termination of service.

TERMINATION AND AMENDMENT
      The  Board  may  amend or  terminate  the  Plan at any  time it is  deemed
necessary or  appropriate;  provided,  however,  that no amendment  may be made,
without the  affirmative  approval of the holder of Company  Voting  Securities,
that would  require  stockholder  approval  under Rule 16b-3,  the Code or other
applicable  law  unless the Board  determines  that  compliance  with Rule 16b-3
and/or the Code is no longer desired.

      Except as provided by the Committee,  in its sole discretion,  at the time
of an Award or pursuant to certain antidilution provisions (as discussed below),
no Award granted under the Plan to a  Participant  may be modified  (unless such
modification does not materially decrease the value of the Award) after the date
of grant  except by  express  written  agreement  between  the  Company  and the
Participant,  provided that any such change (a) may not be inconsistent with the
terms of the Plan, and (b) must be approved by the Committee.

      The Board has the right and the power to  terminate  the Plan at any time.
No Award may be granted under the Plan after the  termination  of the Plan,  but
the  termination  of the  Plan  will not have any  other  effect  and any  Award
outstanding at the time of the  termination  of the Plan may be exercised  after
termination of the Plan at any time prior to the  expiration  date of such Award
to the same  extent  such  Award  would have been  exercisable  had the Plan not
terminated.

ANTIDILUTION PROVISIONS
      Recapitalization.  The  number and kind of shares  subject to  outstanding
Awards,  the purchase price or exercise price of such Awards, and the number and
kind of shares available for Awards subsequently  granted under the Plan will be
appropriately adjusted to reflect any stock dividend,  stock split,  combination
or exchange of shares,  merger,  consolidation or other change in capitalization
with a similar  substantive effect upon the Plan or the Awards granted under the
Plan.  The Committee  has the power and sole  discretion to determine the nature
and amount of the adjustment to be made in each case.  However, in no event will
any adjustment be made in accordance with the Plan's antidilution  provisions to
any previous  grant of Restricted  Shares if an  adjustment  has been or will be
made to the Shares  awarded to a  Participant  in such  person's  capacity  as a
stockholder.

      Sale or Reorganization. After any reorganization,  merger or consolidation
in which the Company is the  surviving  entity,  each  Participant  will,  at no
additional cost, be entitled upon the exercise of an Award  outstanding prior to
such  event,  and in  connection  with the payout  after such event of any Award
outstanding  at the time of such  event,  to receive  (subject  to any  required
action  by  stockholders),  in  lieu  of the  number  of  Shares  receivable  or
exercisable  pursuant to such option, the number and class of shares of stock or
other securities to which such Participant  would have been entitled pursuant to
the terms of the reorganization, merger or consolidation if, at the time of such
reorganization, merger or consolidation, such Participant had been the holder of
record of a number  of  Shares  equal to the  number  of  Shares  receivable  or
exercisable  pursuant  to such  Award.  Comparable  rights  will  accrue to each
Participant   in  the   event  of   successive   reorganizations,   mergers   or
consolidations of the character described above.




                                       37



<PAGE>



      Options to Purchase Stock of Acquired Companies. After any reorganization,
merger  or  consolidation  in which  the  Company  is a  surviving  entity,  the
Committee  may  grant  substituted  options  under the  provisions  of the Plan,
pursuant to Section 424 of the Code,  replacing old options granted under a plan
of another  party to the  reorganization,  merger or  consolidation  whose stock
subject to the old  options  may no longer be issued  following  such  merger or
consolidation.  The  foregoing  adjustments  and  manner of  application  of the
foregoing provisions will be determined by the Committee in its sole discretion.
Any such  adjustments may provide for the  elimination of any fractional  Shares
that might otherwise become subject to any options.

LOANS
      The Company is entitled,  if the Committee in its sole discretion deems it
necessary  or  desirable,  to lend money to a  Participant  for  purposes of (A)
exercising  his or her rights under an Award  hereunder or (B) paying any income
tax  liability  related  to  an  Award;  provided,  however,  that  Non-Employee
Directors are not eligible to receive such loans and provided, further, that the
portion of the per share  exercise price of an option equal to the par value per
Share  may  not be paid by  means  of a  promissory  note.  Such a loan  must be
evidenced  by a recourse  promissory  note  payable to the order of the  Company
executed by the  Participant  and containing  such other terms and conditions as
the  Committee  may deem  desirable.  The  interest  rate on such  loans must be
sufficient to avoid imputed interest under the Code.


ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

      (A) Bassett S. Winmill,  Chairman of the Board of  Directors,  owns all of
the issued and outstanding  shares of the Company's Class B Common Stock,  which
represents 100% of the Company's voting securities.

      (B) The following table sets forth,  as of December 31, 1997,  information
relating  to  beneficial  ownership  by  individual  directors  of the  Company,
executive officers named in the Summary  Compensation Table and by directors and
executive  officers  of the  Company  as a group,  of the  currently  issued and
outstanding Class A Common Stock of the Company.
                                      AMOUNT AND NATURE OF          PERCENT
NAME OF BENEFICIAL OWNER              BENEFICIAL OWNERSHIP (5)      OF CLASS
------------------------              ------------------------      --------
   Bassett S. Winmill                     247,604 (1)                17.8%
   Robert D. Anderson                     103,414 (2)                 7.6%
   Thomas B. Winmill                      119,870 (3)                 8.6%
   Mark C. Winmill                         70,800 (1)                 5.1%
   Edward G. Webb, Jr.                     21,684 (4)                 1.6%
   Charles A. Carroll                      25,000 (4)                 1.8%
   All directors and executive
   officers as a group (10 persons)       588,372                    39.1%

         (1)    Includes options exercisable to purchase 40,000 shares and
                excludes 50,000 options not exercisable at  December 31, 1997.

         (2)    Includes options  exercisable  to purchase  5,000  shares and
                excludes 20,000 options not exercisable at December 31, 1997.

         (3)      Includes  36,000 and 10,000 shares held by Thomas B. Winmill's
                  wife and sons,  respectively of which he disclaims  beneficial
                  ownership and options  exercisable  to purchase  40,000 shares
                  and excludes  50,000  options not  exercisable at December 31,
                  1997.

         (4) Includes options exercisable to purchase 15,000 shares.

         (5) The nature of the beneficial ownership for all the Class A Common
             Stock is investment power.



                                       38


<PAGE>





         (C)      OTHER INFORMATION
         In June 1994,  the Board of Directors of the Company  rejected an offer
of $3.50 per share  contained in a letter dated May 17, 1994 to the Company from
Maxus Investment  Group.  Maxus, of Pepper Pike, Ohio, which was part of a group
that  purportedly  at that  time  owned  26.5% of the  Company's  Class A stock,
offered $3.50 per share for the balance of the Class A stock outstanding subject
to due diligence and the agreement by the holder of the Class B voting stock, to
sell all his  Class B voting  stock.  The  holder  of the  Class B voting  stock
indicated to Maxus,  as he had on numerous  previous  occasions,  that he had no
intention  of  selling  his Class B voting  stock.  In July  1994,  the Board of
Directors of the Company  unanimously  determined  not to proceed with a revised
proposal of Maxus  Investment  Group to  liquidate  the  Company  and  guarantee
shareholders  no less than $5.00 per share, as reflected in Maxus' letters dated
June 17, 1994 and June 28, 1994.  The holder of the Class B voting stock advised
Maxus that he had no intention of selling his Class B stock or voting such stock
for any  proposal  or  transaction  involving  the  merger,  sale,  acquisition,
reorganization, dissolution, or any like extraordinary transaction involving the
Company (See also Note 11).


ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      The following sets forth the reportable  items  regarding  indebtedness of
management  in excess of  $60,000.  In  connection  with the  exercise  of stock
options and related tax  expense,  the Company  received  notes with an interest
rate of 4.86% per annum  payable on the earlier of November 1, 1998 or within 60
days of termination of employment.

                                        LARGEST               AMOUNT
                                        AMOUNT OF             OUTSTANDING AT
NAME AND RELATIONSHIP                   INDEBTEDNESS          DECEMBER 31, 1997

Bassett S. Winmill, Chairman             $83,888                $80,000






                                       39


<PAGE>



                                     PART IV



ITEM 14.     EXHIBITS, CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULES, AND
             REPORTS ON FORM 8-K

     (a)             (1) Financial Statements
                         See Item 8 for a list of the financial statements filed
                         as part of this report.

                     (2) Financial Statement Schedules by Regulation S-X are not
                         required   under  the  related   instructions   or  are
                         inapplicable, and therefore have been omitted.

                     (3)   Exhibits
                           (2) Not applicable

                           (3) Certificate of  Incorporation  as amended
                               October 24,
                                   1989 as filed as an  exhibit to Form 10-K for
                                   the  year  ended   December   31,   1992  and
                                   incorporated  herein by reference  and ByLaws
                                   amended  as of October 1, 1993 as filed as an
                                   exhibit  to  Form  10-K  for the  year  ended
                                   December 31, 1993 and incorporated  herein by
                                   reference.

                          (4) Instruments   defining   the  rights  of  security
                                   holders,  including  indentures  (see Article
                                   Four of Certificate of Incorporation).

                          (9)  Not applicable.

                          (10) Material Contracts

                              (a)   Investment      Management       Agreements,
                                    Distribution     Agreements,     Plans    of
                                    Distribution ("12b-1 Plans") and Shareholder
                                    Administration       Agreements      between
                                    subsidiaries  of the  Company  and the Funds
                                    and Non-Exclusive License Agreements between
                                    the Company and the Funds:

<TABLE>
<CAPTION>

                                                                                              SHAREHOLDER      NON-EXCLUSIVE
                                                           MANAGEMENT   DISTRIBUTION  12B-1    ADMINISTRATION   LICENSE
            FUND                                           AGREEMENT    AGREEMENT     PLAN     AGREEMENT        AGREEMENT

<S>                                                          <C>          <C>         <C>         <C>              <C>
(i)    Bull & Bear Dollar Reserves                           (2)          (2)         (2)         (5)              (8)
(ii)   Bull & Bear Gold Investors Ltd.                       (2)          (2)         (2)         (5)              (8)
(iii)  Bull & Bear Global Income Fund, Inc.                  (7)          -           -           -                (8)
(iv)   Bull & Bear U.S. and Overseas Fund                    (2)          (2)         (2)         (5)              (8)
(v)    Bull & Bear Special Equities Fund, Inc.               (2)          (2)         (2)         (5)              (8)
(vi)   Bull & Bear Municipal Income Fund, Inc.               (7)          -           -           -                (8)
(vii)  Bull & Bear U.S. Government Securities
           Fund, Inc.                                        (7)          -           -           -                (8)
(viii) Midas Fund, Inc.                                      (6)          (6)         (6)         (6)              (8)
(ix)   Rockwood Fund, Inc.                                   (7)          (7)         (7)         (7)              (8)

</TABLE>

                                    (1)  Filed as  exhibits to Form 10-K for the
                                         year  ended   December   31,  1991  and
                                         incorporated herein by reference.

                                    (2)  Filed as  exhibits to Form 10-K for the
                                         year  ended   December   31,  1993  and
                                         incorporated herein by reference.

                                    (3)  Filed as  exhibits to Form 10-K for the
                                         year  ended   December   31,  1989  and
                                         incorporated herein by reference.

                                    (4)  Filed as  exhibits to Form 10-K for the
                                         year  ended   December   31,  1990  and
                                         incorporated herein by reference.

                                    (5)  Filed as  exhibits to Form 10-K for the
                                         year  ended   December   31,  1994  and
                                         incorporated herein by reference.

                                       40



<PAGE>





                                    (6)  Filed as  exhibits to Form 10-K for the
                                         year  ended   December   31,  1995  and
                                         incorporated herein by reference.

                                    (7)  Filed as  exhibits to Form 10-K for the
                                         year  ended   December   31,  1996  and
                                         incorporated herein by reference.

                                    (8)  Filed as exhibits to Form 10-K for the
                                         year ended December 31, 1997 and filed
                                         herewith.

                           (b)      Bull  &  Bear  Group,  Inc.  1995  Long-Term
                                    Incentive Plan, as adopted  December 6, 1995
                                    and  amended  February  6,  1996,  filed  as
                                    exhibit  to Form  10-K  for the  year  ended
                                    December 31, 1995 and incorporated herein by
                                    reference.

                           (c)      Section 422A Incentive Stock Option Plan, as
                                    adopted  December 5, 1990,  filed as exhibit
                                    to Form 10-K for the year ended December 31,
                                    1990 and incorporated herein by reference.

                           (e)      Investment  Management  Transfer  Agreements
                                    between    the     investment     management
                                    subsidiaries  of the  Company  and  filed as
                                    exhibit  to Form  10-K  for the  year  ended
                                    December 31, 1992 and incorporated herein by
                                    reference.

                           (e)      Bull & Bear  Investment  Plan,  filed  as an
                                    exhibit  to Form  10-K  for the  year  ended
                                    December 31, 1993 and incorporated herein by
                                    reference.

                           (f)      Death Benefit  Agreement dated July 22, 1994
                                    and  filed as  exhibit  to Form 10-K for the
                                    year   ended    December    31,   1994   and
                                    incorporated herein by reference.

                           (g)      Bull  & Bear  Group,  Inc.  Incentive  Stock
                                    Option  Agreement for Employees-  Bassett S.
                                    Winmill filed as an exhibit to Form 10-K for
                                    the  year  ended   December   31,  1995  and
                                    incorporated herein by reference.

                           (h)      Bull  & Bear  Group,  Inc.  Incentive  Stock
                                    Option  Agreement for  Employees-  Robert D.
                                    Anderson  filed as an  exhibit  to Form 10-K
                                    for the year  ended  December  31,  1995 and
                                    incorporated herein by reference.

                           (i)      Bull  & Bear  Group,  Inc.  Incentive  Stock
                                    Option  Agreement  for  Employees-  Mark  C.
                                    Winmill filed as an exhibit to Form 10-K for
                                    the  year  ended   December   31,  1995  and
                                    incorporated herein by reference.

                           (j)      Bull  & Bear  Group,  Inc.  Incentive  Stock
                                    Option  Agreement for  Employees-  Thomas B.
                                    Winmill filed as an exhibit to Form 10-K for
                                    the  year  ended   December   31,  1995  and
                                    incorporated herein by reference.

                           (k)      Bull  & Bear  Group,  Inc.  Incentive  Stock
                                    Option  Agreement for  Employees-  Steven A.
                                    Landis  filed as an exhibit to Form 10-K for
                                    the  year  ended   December   31,  1995  and
                                    incorporated herein by reference.

                           (l)      Bull & Bear Group, Inc. Stock Option
                                    Agreement - Edward G. Webb, Jr. filed as an
                                    exhibit to Form 10-K for the year ended
                                    December 31, 1995 and incorporated herein
                                    by reference.



                                       41



<PAGE>





                           (m)      Bull  &  Bear  Group,   Inc.   Stock  Option
                                    Agreement - Charles A.  Carroll  filed as an
                                    exhibit  to Form  10-K  for the  year  ended
                                    December 31, 1995 and incorporated herein by
                                    reference.

                           (n)      Bull  &  Bear  Group,  Inc.  1995  Long-Term
                                    Incentive  Plan, (as Amended and Restated as
                                    of October  29,  1997),  filed as exhibit to
                                    Form 10-K for the year  ended  December  31,
                                    1997 and filed herewith.

                           (o)      Option  Certificate  for Bassett S.  Winmill
                                    filed  as an  exhibit  to Form  10-K for the
                                    year  ended  December  31,  1997  and  filed
                                    herewith.

                           (p)  Option Certificate for Edward G. Webb, Jr.
                                filed as an exhibit to Form 10-K for the
                                year ended December 31, 1997 and filed herewith.

                           (q)      Option  Certificate  for Charles A.  Carroll
                                    filed  as an  exhibit  to Form  10-K for the
                                    year  ended  December  31,  1997  and  filed
                                    herewith.

                           (r)      Option  Certificate  for  Thomas B.  Winmill
                                    filed  as an  exhibit  to Form  10-K for the
                                    year  ended  December  31,  1997  and  filed
                                    herewith.

                           (s)      Option Certificate for Mark C. Winmill filed
                                    as an  exhibit  to Form  10-K  for the  year
                                    ended December 31, 1997 and filed herewith.

                           (t)         Option Certificate for Robert D. Anderson
                                       filed as an  exhibit to Form 10-K for the
                                       year ended  December  31,  1997 and filed
                                       herewith.

                   (11)   Statement Regarding Computation of Per Share Earnings
                   (12)   Not applicable.
                   (13)   Not applicable.
                   (16)   Not applicable.
                   (18)   Not applicable.
                   (21)   Wholly-Owned Subsidiaries of the Company
                   (22)   Not applicable.
                   (23)   Not applicable.
                   (24)   Not applicable.
                   (27)   Not applicable.
                   (28)   Not applicable.
                   (99)   Not applicable.

    (b)  Reports on Form 8-K. No reports on Form 8-K were filed  during the last
         quarter of the period covered by this report.


                                       42


<PAGE>



                                   SIGNATURES



      Pursuant to the requirements of Section 13 of the Securities  Exchange Act
of 1934,  the  Company has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

                                         BULL & BEAR GROUP, INC.



March 31, 1998                           By:/s/ Joseph Leung
                                         -------------------
                                         Joseph Leung
                                         Treasurer, Chief Accounting Officer

      Pursuant to the requirements of the Securities  Exchange Act of 1934, this
report has been signed by the following  persons on behalf of the Company and in
the capacities and on the dates indicated.


March 31, 1998                            By:/s/ Bassett S. Winmill
                                          -------------------------
                                          Bassett S. Winmill,
                                          Chairman of the Board, Director


March 31, 1998                            By:/s/ Robert D. Anderson
                                          -------------------------
                                          Robert D. Anderson,
                                          Vice Chairman, Director


March 31, 1998                            By:/s/ Mark C. Winmill
                                          ----------------------
                                          Mark C. Winmill,
                                          Co-President, Chief Financial Officer,
                                          Director


March 31, 1998                           By:/s/ Thomas B. Winmill
                                         ------------------------
                                         Thomas B. Winmill, Esq.
                                         Co-President, General Counsel, Director


March 31, 1998                            By:/s/ Edward G. Webb, Jr.
                                          ---------------------------
                                          Edward G. Webb, Jr.
                                          Director



March 31, 1998                            By:/s/ Charles A. Carroll
                                          -------------------------
                                          Charles A. Carroll,
                                          Director



                                       43


<PAGE>



                               INDEX TO EXHIBITS


(3)  Exhibits

        (10)   Material Contracts

               (a)  Bull & Bear Group, Inc. 1995 Long-Term Incentive Plan
                    (As Amended And Restated As Of
                    October 29, 1997).

               (b)  Option Certificate for Bassett S. Winmill

               (c)  Option Certificate for Edward G. Webb, Jr.

               (d)  Option Certificate for Charles A. Carroll

               (e)  Option Certificate for Thomas B. Winmill

               (f)  Option Certificate for Mark C. Winmill

               (g)  Option Certificate for Robert D. Anderson

               (h)  Non-Exclusive License Agreement between the Company and Bull
                    & Bear Funds I, Inc.

               (i)  Non-Exclusive License Agreement between the Company and Bull
                    & Bear Funds II, Inc.

               (j)  Non-Exclusive License Agreement between the Company and Bull
                    & Bear Gold Investors, Ltd.

               (k)  Non-Exclusive License Agreement between the Company and Bull
                    & Bear Global Income Fund, Inc.

               (l)  Non-Exclusive License Agreement between the Company and
                    Midas Fund, Inc.

               (m)  Non-Exclusive License Agreement between the Company and Bull
                    & Bear Municipal Income Fund, Inc.

               (n)  Non-Exclusive License Agreement between the Company and
                    Rockwood Fund, Inc.

               (o)  Non-Exclusive License Agreement between the Company and Bull
                    & Bear Special Equities Fund, Inc.

               (p)  Non-Exclusive License Agreement between the Company and Bull
                    & Bear U.S. Government Securities Fund, Inc.

        (11)   Statement Regarding Computation of Per Share Earnings

        (21)   Wholly-Owned Subsidiaries of the Company






                                       44
<PAGE>

                             BULL & BEAR GROUP, INC.
                          1995 LONG-TERM INCENTIVE PLAN
                (AS AMENDED AND RESTATED AS OF OCTOBER 29, 1997)


ARTICLE I.  PURPOSE AND TERM OF THE PLAN

         1.01 PURPOSE. The purpose of the Bull & Bear Group, Inc. 1995 Long-Term
Incentive  Plan (as Amended and  Restated as of October 29,  1997)  (hereinafter
referred to as the "Plan") is to assist the Company (as hereinafter defined) and
its  subsidiaries in attracting and retaining  individuals to serve as directors
and highly competent personnel who will contribute to the success of the Company
and its subsidiaries and to act as an incentive in motivating selected officers,
key employees and directors to achieve long-term objectives, which will inure to
the benefit of all stockholders of the Company.

         1.02 TERM. The Plan shall terminate without further action of the Board
on December 5, 2005.

ARTICLE II.  DEFINITIONS

         For purposes of the Plan,  capitalized  terms shall have the  following
meanings:

         2.01 AWARD means any grant to a Participant of any one or a combination
of Non-Qualified  Stock Options or Incentive Stock Options  described in Article
VI, or Restricted Shares described in Article VII.

         2.02 AWARD AGREEMENT means, with respect to an Option, a certificate of
Option  signed by a President of the  Company,  and with respect to a Restricted
Share  Award,  a  written  agreement  between  the  Company  and a  Participant,
specifically  setting  forth the terms and  conditions  of an Award granted to a
Participant under the Plan.

         2.03 AWARD PERIOD means,  with respect to an Award, the period of time,
if  any,  set  forth  in the  Award  Agreement  during  which  specified  target
performance  goals must be achieved or other  conditions  set forth in the Award
Agreement must be satisfied.

         2.04 BENEFICIARY  means an individual,  trust or estate who or that, by
will or the  laws of  descent  and  distribution,  succeeds  to the  rights  and
obligations of the  Participant  under the Plan and an Award  Agreement upon the
Participant's death.

         2.05     BOARD means the Board of Directors of the Company.

         2.06 CAUSE means termination for, as determined by the Committee in its
sole discretion,  (i) dishonest or fraudulent conduct relating to the Company or
any of its subsidiaries or their businesses; (ii) conviction of any felony that,
in the judgment of the Board,  involves moral turpitude or otherwise reflects on
the Company or any of its subsidiaries in a significantly  adverse way; or (iii)
gross neglect by the  Participant in the  performance of his or her duties as an
employee  or  director,  or any  material  breach  by a  Participant  under  any
employment agreement with the Company or any of its subsidiaries.

         2.07 CODE means the Internal Revenue Code of 1986, as amended from time
to time,  or any  successor  thereto.  References to a section of the Code shall
include  that  section  and any  comparable  section or  sections  of any future
legislation that amends, supplements or supersedes said section.

         2.08  COMMITTEE  means a Committee of the Board as may be designated by
the Board.  The  Committee  shall be composed of at least two  directors  of the
Company, each of whom is a "Non-Employee Director" as defined in Rule 16b-3. The
Committee  shall  have  the  power  and  authority  to  administer  the  Plan in
accordance with Section 3.01.

         2.09  COMMON STOCK means the Class A Common Stock, par value $.01 per
               share, of the Company.


<PAGE>


         2.10 COMPANY  means Bull & Bear Group,  Inc., a  corporation  organized
under the laws of the State of Delaware, and its successors.

         2.11 COMPANY  VOTING  SECURITIES  means the Class B Common  Stock,  par
value $.01 per share, which is entitled to vote generally in the election of the
Board.

         2.12 DATE OF GRANT means the date  designated  by the  Committee as the
date as of which it grants an Award, which shall not be earlier than the date on
which the Committee approves the granting of such Award.

         2.13 DISABILITY  means any physical or mental  impairment or disability
that prevents a Participant  from performing the duties of his or her employment
(or service as a member of the Board in the case of Non-Employee  Directors) and
that is expected  to be of  permanent  duration.  A  determination  of whether a
Participant is disabled shall be made by a licensed  physician  appointed by the
Committee.

         2.14  DISABILITY DATE means the date that is 120 days after the date on
which a Participant is first absent from active  employment with the Company (or
any of its subsidiaries) or service as a Non-Employee  Director, as the case may
be, by reason of a Disability.

         2.15  EXCHANGE  ACT  means  the  Securities  Exchange  Act of 1934,  as
amended.

         2.16 FAIR  MARKET  VALUE of a share of Common  Stock  means,  as of any
given date, the most recently  reported sale price of a share of Common Stock on
such date as of the time  when  Fair  Market  Value is being  determined  on the
principal national  securities exchange on which the Common Stock is then traded
or, if the Common  Stock is not then traded on a national  securities  exchange,
the most recently reported sale price of the Common Stock on such date as of the
time when Fair Market Value is being  determined on the National  Association of
Securities  Dealers Automated  Quotation System ("Nasdaq");  provided,  however,
that, if there were no sales  reported as of such date,  Fair Market Value shall
be the last sale price previously reported. In the event the Common Stock is not
admitted to trade on a securities  exchange or quoted on Nasdaq, the Fair Market
Value of a share of Common Stock as of any given date shall be as  determined in
good faith by the  Committee.  Notwithstanding  the  foregoing,  the Fair Market
Value of a share of Common Stock shall never be less than par value per share.

         2.17 INCENTIVE STOCK OPTION means an Option  designated as an incentive
stock option and that complies with Section 422 of the Code.

         2.18 NON-EMPLOYEE DIRECTOR means each member of the Board who is not an
employee of the Company or any of its subsidiaries.

         2.19  NON-QUALIFIED  STOCK  OPTION  means  an  Option  that  is  not an
Incentive Stock Option.

         2.20 OPTION means any option to purchase Common Stock granted  pursuant
to Article VI, including any Reload Option.

         2.21  PARTICIPANT  means  any  employee  of the  Company  or any of its
subsidiaries  selected by the Committee,  and any Non-Employee Director selected
by the Board, to receive an Award under the Plan in accordance with Article V.

         2.22 PLAN means the Bull & Bear Group,  Inc. 1995  Long-Term  Incentive
Plan (as Amended and Restated as of October 29, 1997) as set forth  herein,  and
as the same may be amended from time to time.

         2.23  RESTRICTED  SHARES  means  shares  of  Common  Stock  subject  to
restrictions imposed in connection with Awards granted under Article VII.

         2.24 RULE 16B-3  means Rule 16b-3  promulgated  by the  Securities  and
Exchange  Commission  under  Section 16 of the Exchange  Act, as the same may be
amended from time to time, and any successor rule.


<PAGE>


         2.25 TEN PERCENT  SHAREHOLDER  means a Participant  who, at the time of
grant of an Option,  owns (or is deemed to own under Section 424(d) of the Code)
more than 10% of Company Voting Securities.

         2.26  TERMINATION  OF  EMPLOYMENT  OR SERVICE  means the  voluntary  or
involuntary  termination  of a  Participant's  employment  with, or service as a
Non-Employee Director of, the Company or any of its subsidiaries for any reason,
including  death,  Disability,  retirement or as the result of the sale or other
divestiture of the Company or any of its subsidiaries or any similar transaction
in which  the  Participant's  employer  or  service  recipient  ceases to be the
Company  or  one  of  its  subsidiaries.  Whether  entering  military  or  other
government  service shall constitute  Termination of Employment or Service,  and
whether a Termination of Employment or Service is a result of Disability,  shall
be determined in each case by the Committee.

ARTICLE III.  ADMINISTRATION

         3.01  COMMITTEE.  The Plan  shall be  administered  by the Board or the
Committee,  each of which  shall  have  exclusive  and final  authority  in each
determination,  interpretation  or  other  action  affecting  the  Plan  and its
Participants.  During any period in which the Plan is administered by the Board,
and with respect to any Awards granted to Non-Employee Directors, all references
in the  Plan to the  Committee  shall be  deemed  to  refer  to the  Board.  The
Committee shall have the sole and absolute  discretion to interpret the Plan, to
establish and modify  administrative  rules for the Plan, to select the officers
and other key  employees to whom Awards may be granted,  to determine all claims
for benefits  under the Plan,  to impose such  conditions  and  restrictions  on
Awards as it determines  appropriate  and to take such steps in connection  with
the Plan and Awards granted hereunder as it may deem necessary or advisable. The
Committee may, with respect to Participants who are not subject to Section 16 of
the Exchange Act, delegate such of its powers and authority under the Plan as it
deems appropriate to designated officers or employees of the Company.

ARTICLE IV.  SHARES OF COMMON STOCK

         4.01 NUMBER OF SHARES OF COMMON STOCK ISSUABLE.  Subject to adjustments
as provided in Section 8.06,  450,000  shares of Common Stock shall be available
for  Awards  of  Non-Qualified  Stock  Options,   Incentive  Stock  Options  and
Restricted  Shares  under the Plan.  Any and all of such shares may be issued in
respect of any of the types of Awards.  The Common Stock to be offered under the
Plan shall be authorized and unissued  Common Stock, or issued Common Stock that
shall have been reacquired by the Company and held in its treasury.  The Company
may, but shall not be required to,  register any shares of Common Stock issuable
pursuant to the Plan, under the Securities Act of 1933, as amended.

         4.02 NUMBER OF SHARES OF COMMON STOCK  AWARDED TO ANY  PARTICIPANT.  In
the event the  purchase  price of an Option is paid in whole or in part  through
the delivery of shares of Common Stock issuable in connection  with the exercise
of the Option,  a Participant  will be determined to have received an Award with
respect to those shares of Common Stock.

         4.03 SHARES OF COMMON STOCK SUBJECT TO TERMINATED AWARDS. The shares of
Common Stock covered by any unexercised  portions of terminated  Options granted
under  Article  VI,  shares of Common  Stock  forfeited  as  provided in Section
7.02(a)  and shares of Common  Stock  subject to any Awards  that are  otherwise
surrendered by the  Participant  without  receiving any payment or other benefit
with respect  thereto may again be subject to new Awards under the Plan.  In the
event the purchase price of an Option or tax withholding relating to an Award is
paid in whole or in part  through the  delivery of shares of Common  Stock,  the
number of shares of Common Stock issuable in connection with the exercise of the
Option shall not again be available for the grant of Awards under the Plan.


<PAGE>


ARTICLE V.  PARTICIPATION

         5.01  ELIGIBLE  PARTICIPANTS.  Participants  in the Plan  shall be such
officers and other key employees of the Company or its subsidiaries,  whether or
not directors of the Company,  as the  Committee,  in its sole  discretion,  may
designate from time to time. The Committee's designation of a Participant in any
year shall not require the Committee to designate  such person to receive Awards
in any other  year.  The  Committee  shall  consider  such  factors  as it deems
pertinent in selecting  Participants  and in determining  the type and amount of
their respective Awards.

         Non-Employee  Directors shall receive such Awards (other than Incentive
Stock Options) as the Board, in its discretion, may designate from time to time.

ARTICLE VI.  STOCK OPTIONS

         6.01 GRANT OF OPTION. Any Option granted under the Plan shall have such
terms as the  Committee  may,  from  time to time,  approve,  and the  terms and
conditions of Options need not be the same with respect to each Participant. The
Committee  shall  have the  authority  to grant to any  Participant  one or more
Incentive Stock Options,  Non-Qualified Stock Options, or both types of Options.
To the extent  that any Option  does not qualify as an  Incentive  Stock  Option
(whether  because of its  provisions  or the time or manner of its  exercise  or
otherwise),  such Option or the  portion  thereof  that does not  qualify  shall
constitute a separate Non-Qualified Stock Option.

         6.02  INCENTIVE  STOCK  OPTIONS.  In the case of any grant of an Option
intended to be an Incentive Stock Option,  whenever possible,  each provision in
the Plan and in any related Award  Agreement  (other than those  relating to the
exercise of Options  following  Termination  of Employment or Service)  shall be
interpreted  in  such a  manner  as to  entitle  the  Option  holder  to the tax
treatment  afforded by Section 422 of the Code and, if any such provision of the
Plan or such  Award  Agreement  shall be held not to  comply  with  requirements
necessary to entitle such Option to such tax treatment,  then (a) such provision
shall be deemed to have  contained  from the outset  such  language  as shall be
necessary to entitle the Option to the tax treatment  afforded under Section 422
of the Code,  and (b) all other  provisions of the Plan and the Award  Agreement
relating to such  Option  shall  remain in full force and  effect.  If any Award
Agreement  covering an Option  designated  by the  Committee  to be an Incentive
Stock Option  shall not  explicitly  include any terms  required to entitle such
Incentive Stock Option to the tax treatment  afforded by Section 422 of the Code
(other than those relating to the exercise of Options  following  Termination of
Employment  or  Service),  all  such  terms  shall  be  deemed  implicit  in the
designation of such Option as an Incentive  Stock Option and the Option shall be
deemed to have been granted subject to all such terms.

         6.03 TERMS OF OPTIONS.  Options granted under the Plan shall be subject
to the following terms and conditions and shall be in such form and contain such
additional terms and conditions, not inconsistent with the terms of the Plan, as
the Committee shall deem desirable:


       (a) Option Price. The option price per share of Common Stock  purchasable
                  under an Option shall be  determined  by the  Committee at the
                  time of grant  but  shall  not be less  than  100% of the Fair
                  Market  Value of a share of Common Stock on the Date of Grant;
                  provided,  however,  that,  if an  Incentive  Stock  Option is
                  granted to a Ten  Percent  Shareholder,  the option  price per
                  share  shall be at least  ll0% of the Fair  Market  Value of a
                  share of Common Stock on the Date of Grant.

       (b) Option Term. The term of each Option shall be fixed by the Committee,
                  but no Option shall be  exercisable  more than ten years after
                  the Date of Grant;  provided,  however,  that, if an Incentive
                  Stock  Option is granted  to a Ten  Percent  Shareholder,  the
                  Option shall not be exercisable more than five years after the
                  Date of Grant.


<PAGE>


     (c) Exercisability.  An Award Agreement with respect to Options may contain
                  such performance targets, waiting periods,  exercise dates and
                  restrictions  on  exercise  (including,  but not limited to, a
                  requirement   that  an  Option  is   exercisable  in  periodic
                  installments)  as may be  determined  by the  Committee at the
                  time of  grant;  provided,  however,  that,  unless  the Board
                  determines otherwise,  no Option may be exercised prior to the
                  holder's  completion  of two  years  of  employment  with,  or
                  service as a  Non-Employee  Director of, the Company or any of
                  its subsidiaries.

         (d) Method of Exercise.  Subject to whatever  installment  exercise and
         waiting period provisions apply under subsection (c) above, Options may
         be exercised  in whole or in part at any time during the Award  Period,
         by giving  written  notice of exercise to the  Company  specifying  the
         number of shares of Common Stock to be purchased.  Such notice shall be
         accompanied  by payment in full of the  purchase  price in such form as
         the  Committee  may  accept,  including  cash for the par  value  and a
         promissory  note for the balance with interest and terms  acceptable to
         the  Committee  as  provided  in  Section  8.07.  If and to the  extent
         determined by the  Committee in its sole  discretion at or after grant,
         payment in full or in part may also be made in the form of Common Stock
         duly owned by the  Participant  (and for which the Participant has good
         title, free and clear of any liens and encumbrances) or by reduction in
         the number of shares of Common Stock issuable upon such exercise based,
         in each case,  on the Fair Market Value of the Common Stock on the date
         the Option is  exercised;  provided,  however,  that, in the case of an
         Incentive Stock Option, the right to make payment of the purchase price
         in the  form of  Common  Stock  may be  authorized  only at the time of
         grant.  No Common  Stock  shall be issued  until  payment,  as provided
         herein,  therefor has been made. A Participant shall generally have the
         rights to dividends or other  rights of a  stockholder  with respect to
         Common  Stock  subject to the  Option  when the  Participant  has given
         written  notice  of  exercise  and has paid for  such  Common  Stock as
         provided herein.

         (f)  Non-Transferability of Options. No Option shall be transferable by
         the  Participant  otherwise  than by will or by the laws of descent and
         distribution,  and  all  Options  shall  be  exercisable,   during  the
         Participant's lifetime, only by the Participant.

         (g)      Exercise of Options Upon Termination of Employment or Service.

                  (i)  Exercise of Vested Options Upon Termination of Employment
                       or Service.

                  (A) Termination. Unless the Committee, in its sole discretion,
                  provides for a shorter period of time in the Award  Agreement,
                  upon a  Participant's  Termination  of  Employment  or Service
                  other than by reason of death or Disability,  the  Participant
                  may, within three months from the date of such  Termination of
                  Employment or Service,  exercise all or any part of his or her
                  Options  as were  exercisable  at the date of  Termination  of
                  Employment or Service but only if (x) the Participant  resigns
                  or retires and the Committee  consents to such  resignation or
                  retirement  and (y) such  Termination of Employment or Service
                  is not for Cause. If such Termination of Employment or Service
                  is for Cause or the Committee  does not so consent,  the right
                  of such  Participant to exercise such Options shall  terminate
                  at the date of  Termination  of Employment  or Service.  In no
                  event,  however,  may any Option be  exercised  later than the
                  date described in Section 6.03(b).

                  (B) Disability.  Unless the Committee, in its sole discretion,
                  provides for a shorter period of time in the Award  Agreement,
                  upon a Participant's  Disability  Date, the  Participant  may,
                  within one year after the Disability  Date,  exercise all or a
                  part of his or her  Options  that were  exercisable  upon such
                  Disability  Date.  In no  event,  however,  may any  Option be
                  exercised later than the date described in Section 6.03(b).


<PAGE>


                  (C)  Death.  Unless  the  Committee,  in its sole  discretion,
                  provides for a shorter period of time in the Award  Agreement,
                  in the event of the death of a Participant  while employed by,
                  or serving as a Non-Employee Director of, the Company or prior
                  to the expiration of the Option as provided in Section 6.03(g)
                  (i) (B) above, to the extent all or any part of the Option was
                  exercisable  as of the date of death of the  Participant,  the
                  right of the Participant's  Beneficiary to exercise the Option
                  shall expire upon the  expiration of one year from the date of
                  the  Participant's  death  (but in no event more than one year
                  from  the  Participant's  Disability  Date)  or on the date of
                  expiration  of  the  Option  determined  pursuant  to  Section
                  6.03(b),  whichever  is  earlier.  In all other cases of death
                  following  a   Participant's   Termination  of  Employment  or
                  Service, the Participant's Beneficiary may exercise the Option
                  within the remaining time, if any, provided in Section 6.03(g)
                  (l) (A) above. In the event of the  Participant's  death,  the
                  Committee may, in its sole discretion, accelerate the right to
                  exercise all or any part of an Option that would not otherwise
                  be exercisable.

                  (ii)  Expiration  of  Unvested  Options  Upon  Termination  of
                  Employment  or  Service.  To the  extent all or any part of an
                  Option was not  exercisable  as of the date of  Termination of
                  Employment or Service,  such right shall expire at the date of
                  such Termination of Employment or Service. Notwithstanding the
                  foregoing,  the  Committee,  in its sole  discretion and under
                  such terms as it deems  appropriate,  may permit a Participant
                  who  will  continue  to  render  significant  services  to the
                  Company after his or her  Termination of Employment or Service
                  to continue  to accrue  service  with  respect to the right to
                  exercise  his or her  Options  during  the period in which the
                  individual continues to render such services.

ARTICLE VII.  RESTRICTED SHARES

         7.01 RESTRICTED  SHARE AWARDS.  Restricted  Shares may be issued either
alone or in addition to other Awards  granted under the Plan.  The Committee may
grant to any Participant an Award of shares of Common Stock in such number,  and
subject to such terms and conditions relating to forfeitability and restrictions
on delivery and transfer  (whether  based on performance  standards,  periods of
service  or  otherwise)  as the  Committee  shall  establish.  The  terms of any
Restricted  Share  Award  granted  under the Plan shall be set forth in an Award
Agreement,  which shall contain  provisions  determined by the Committee and not
inconsistent  with the Plan. The provisions of Restricted  Share Awards need not
be the same for each Participant receiving such Awards.

         (a) Issuance of Restricted  Shares.  As soon as  practicable  after the
         Date of Grant of a Restricted Share Award by the Committee, the Company
         shall cause to be  transferred  on the books of the  Company  shares of
         Common Stock,  registered on behalf of the Participant in nominee form,
         evidencing the Restricted  Shares covered by the Award,  but subject to
         forfeiture to the Company  retroactive to the Date of Grant if an Award
         Agreement  delivered to the  Participant by the Company with respect to
         the Restricted  Shares covered by the Award is not duly executed by the
         Participant and timely returned to the Company. Each Participant,  as a
         condition to the receipt of a Restricted Share Award,  shall pay to the
         Company in cash the par value of a share of Common Stock  multiplied by
         the number of shares of Common Stock covered by such  Restricted  Share
         Award.  All shares of Common Stock covered by Awards under this Article
         VII  shall  be  subject  to  the  restrictions,  terms  and  conditions
         contained  in the  Plan and the  Award  Agreement  entered  into by and
         between the Company and the Participant.  Until the lapse or release of
         all restrictions applicable to an Award of Restricted Shares, the stock
         certificates  representing  such  Restricted  Shares  shall  be held in
         custody by the  Company or its  designee.  Upon the lapse or release of
         all  restrictions  with  respect  to an Award as  described  in Section
         7.01(d), one or more stock certificates,  registered in the name of the
         Participant,  for an  appropriate  number of shares of Common  Stock as
         provided in Section 7.01(d),  free of any restrictions set forth in the
         Plan and the Award Agreement, shall be delivered to the Participant.



<PAGE>


         (b)  Shareholder  Rights.  Beginning  on  the  Date  of  Grant  of  the
         Restricted  Share Award and subject to execution of the Award Agreement
         as  provided  in  Section  7.01(a),  the  Participant  shall  become  a
         shareholder  of the Company  with respect to all shares of Common Stock
         subject  to the Award  Agreement  and shall have all of the rights of a
         holder of Common  Stock,  including,  but not  limited to, the right to
         receive dividends (or dividend  equivalents);  provided,  however, that
         any shares of Common Stock  distributed as a dividend or otherwise with
         respect to any Restricted  Shares as to which the restrictions have not
         yet lapsed shall be subject to the same restrictions as such Restricted
         Shares and shall be represented by book entry and held as prescribed in
         Section 7.01(a)

         (c) Restriction on  Transferability.  None of the Restricted Shares may
         be assigned or  transferred  (other than by will or the laws of descent
         and  distribution),  pledged  or sold  prior to lapse or release of the
         restrictions applicable thereto.

         (d) Delivery of Shares of Common  Stock Upon  Release of  Restrictions.
         Upon expiration or earlier termination of the forfeiture period without
         a  forfeiture  and  the  satisfaction  of or  release  from  any  other
         conditions prescribed by the Committee,  the restrictions applicable to
         the  Restricted  Shares  shall lapse.  As promptly as  administratively
         feasible  thereafter,  subject to the requirements of Section 8.05, the
         Company  shall  deliver  to  the   Participant   or,  in  case  of  the
         Participant's  death,  to the  Participant's  Beneficiary,  one or more
         stock  certificates  for the  appropriate  number  of  shares of Common
         Stock, free of all such restrictions,  except for any restrictions that
         may be imposed by law.

7.02     TERMS OF RESTRICTED SHARES.

         (a) Forfeiture of Restricted  Shares.  Subject to Section 7.02(b),  all
         Restricted  Shares shall be  forfeited  and returned to the Company and
         all rights of the Participant  with respect to such  Restricted  Shares
         shall terminate unless the Participant  continues in the service of the
         Company or any parent or  subsidiary  of the  Company as an employee or
         Non-Employee Director until the expiration of the forfeiture period for
         such Restricted  Shares and satisfies any and all other  conditions set
         forth in the Award  Agreement.  The Committee,  in its sole discretion,
         shall  determine the forfeiture  period (which may, but need not, lapse
         in  installments)  and any other terms and conditions  applicable  with
         respect to any Restricted Share Award.

         (b) Waiver of Forfeiture Period.  Notwithstanding anything contained in
         this  Article  VII to the  contrary,  the  Committee  may,  in its sole
         discretion,  waive the forfeiture period as may be determined  pursuant
         to Section  7.02(a) or otherwise and any other  conditions set forth in
         any Award  Agreement  under  appropriate  circumstances  (including the
         death, disability or retirement of the Participant or a material change
         in  circumstances  arising  after the date of an Award) and  subject to
         such terms and  conditions  (including  forfeiture  of a  proportionate
         number of Restricted  Shares) as the Committee shall deem  appropriate,
         provided that, unless the Board determines  otherwise,  the Participant
         shall at that time  have  completed  at least  two years of  employment
         with, or service as a  Non-Employee  Director of, the Company or any of
         its subsidiaries.

ARTICLE VIII.  TERMS APPLICABLE TO ALL AWARDS GRANTED UNDER THE PLAN

         8.01 PLAN PROVISIONS  CONTROL AWARD TERMS.  The terms of the Plan shall
govern all Awards  granted  under the Plan,  and in no event shall the Committee
have the  power to grant to a  Participant  any  Award  under  the Plan  that is
contrary to any  provisions of the Plan. In the event any provision of any Award
granted  under  the Plan  shall  conflict  with any of the  terms in the Plan as
constituted  on the  Date of  Grant  of such  Award,  the  terms  in the Plan as
constituted on the Date of Grant of such Award shall control.

         8.02 AWARD  AGREEMENT.  If there is any conflict between the provisions
of an Award  Agreement  and the terms of the Plan,  the terms of the Plan  shall
control.



<PAGE>



         8.03  MODIFICATION  OF AWARD  AFTER  GRANT.  Except as  provided by the
Committee,  in its sole  discretion,  in the Award  Agreement  or as provided in
Section 8.06,  no Award granted under the Plan to a Participant  may be modified
(unless such modification  does not materially  decrease the value of the Award)
after the Date of Grant except by express written  agreement between the Company
and the Participant, provided that any such change (a) shall not be inconsistent
with the terms of the Plan, and (b) shall be approved by the Committee.

         8.04 LIMITATIONS ON TRANSFER.  The rights and interest of a Participant
under the Plan may not be assigned or transferred other than by will or the laws
of descent and  distribution.  During the  lifetime of a  Participant,  only the
Participant  personally may exercise rights under the Plan.  Except as otherwise
specifically provided in the Plan, a Participant's  Beneficiary may exercise the
Participant's  rights only to the extent they were exercisable under the Plan at
the  date  of  the  death  of  the  Participant  and  are  otherwise   currently
exercisable.

         8.05 TAXES.  The Company shall be entitled,  if the Committee  deems it
necessary or desirable,  to withhold (or secure payment from the  Participant in
lieu of withholding)  the amount of any withholding or other tax required by law
to be withheld or paid by the Company with respect to any amount  payable and/or
shares of Common Stock issuable under such Participant's  Award, or with respect
to any income  recognized upon lapse of  restrictions  applicable to an Award or
upon a  disqualifying  disposition  of Common  Stock  received  pursuant  to the
exercise of an Incentive  Stock  Option,  and the Company may defer  issuance of
Common Stock upon the grant,  exercise or vesting of an Award unless indemnified
to its  satisfaction  against any liability for any such tax. The amount of such
withholding  or tax payment shall be determined by the Committee or its delegate
and  shall  be  payable  by the  Participant  at  such  time  as  the  Committee
determines.  The methods of withholding  may include,  without  limitation,  the
payment of cash by the Participant to the Company and the  withholding  from the
Award,  at  the  appropriate  time,  of a  number  of  shares  of  Common  Stock
sufficient,  based upon the Fair Market Value of such Common  Stock,  to satisfy
such tax withholding  requirements.  The Committee  shall be authorized,  in its
sole  discretion,  to establish such rules and  procedures  relating to any such
withholding methods as it deems necessary or appropriate.

         8.06     ADJUSTMENTS TO REFLECT CAPITAL CHANGES.

         (a)  Recapitalization.  The  number  and  kind  of  shares  subject  to
         outstanding  Awards,  the  purchase  price  or  exercise  price of such
         Awards,  and  the  number  and  kind of  shares  available  for  Awards
         subsequently granted under the Plan shall be appropriately  adjusted to
         reflect any stock  dividend,  stock split,  combination  or exchange of
         shares, merger,  consolidation or other change in capitalization with a
         similar  substantive  effect upon the Plan or the Awards  granted under
         the Plan.  The  Committee  shall have the power and sole  discretion to
         determine  the nature and amount of the  adjustment  to be made in each
         case. In no event shall any  adjustment be made under the provisions of
         this Section  8.06(a) to any previous grant of Restricted  Shares if an
         adjustment  has  been or will be made to the  shares  of  Common  Stock
         awarded to a Participant in such person's capacity as a stockholder.

         (b)  Sale  or  Reorganization.  After  any  reorganization,  merger  or
         consolidation  in which  the  Company  is the  surviving  entity,  each
         Participant shall, at no additional cost, be entitled upon the exercise
         of an Award outstanding prior to such event, and in connection with the
         payout  after such event of any Award  outstanding  at the time of such
         event, to receive (subject to any required action by stockholders),  in
         lieu of the number of shares of Common Stock  receivable or exercisable
         pursuant  to such  Option,  the  number and class of shares of stock or
         other  securities  to which such  Participant  would have been entitled
         pursuant to the terms of the  reorganization,  merger or  consolidation
         if, at the time of such reorganization,  merger or consolidation,  such
         Participant  had been the  holder  of  record  of a number of shares of
         Common Stock equal to the number of shares of Common  Stock  receivable
         or exercisable  pursuant to such Award.  Comparable rights shall accrue
         to each Participant in the event of successive reorganizations, mergers
         or consolidations of the character described above.



<PAGE>



         (c)  Options  to  Purchase  Stock  of  Acquired  Companies.  After  any
         reorganization, merger or consolidation in which the Company shall be a
         surviving entity, the Committee may grant substituted Options under the
         provisions of the Plan, pursuant to Section 424 of the Code,  replacing
         old   options   granted   under  a  plan  of   another   party  to  the
         reorganization,  merger or consolidation whose stock subject to the old
         options may no longer be issued following such merger or consolidation.
         The foregoing  adjustments  and manner of  application of the foregoing
         provisions shall be determined by the Committee in its sole discretion.
         Any such  adjustments may provide for the elimination of any fractional
         shares of Common  Stock  that  might  otherwise  become  subject to any
         Options.

         8.07 LOANS. The Company shall be entitled, if the Committee in its sole
discretion  deems it necessary or desirable,  to lend money to a Participant for
purposes of (a)  exercising  his or her rights  under an Award  hereunder or (b)
paying any income tax liability  related to an Award;  provided,  however,  that
Non-  Employee  Directors  shall  not be  eligible  to  receive  such  loans and
provided, further, that the portion of the per share exercise price of an Option
equal to the par value per share of Common Stock shall not be paid by means of a
promissory  note.  Such a loan shall be evidenced by a recourse  promissory note
payable to the order of the Company  executed by the  Participant and containing
such  other  terms and  conditions  as the  Committee  may deem  desirable.  The
interest rate on such loans shall be sufficient to avoid imputed  interest under
the Code.

         8.08 SURRENDER OF AWARDS.  Any Award granted to a Participant under the
Plan may be  surrendered  to the Company for  cancellation  on such terms as the
Committee and holder approve.

         8.09 NO RIGHT TO AWARD; NO RIGHT TO EMPLOYMENT OR SERVICE. No employee,
Non-Employee  Director  or other  person  shall  have  any  claim or right to be
granted an Award.  Neither  the Plan nor any  action  taken  hereunder  shall be
construed  as giving  any  employee  or  Non-Employee  Director  any right to be
retained in the employ or service of the Company or any of its subsidiaries.

         8.10 AWARDS NOT INCLUDABLE FOR BENEFIT PURPOSES. Income recognized by a
Participant  pursuant to the provisions of the Plan shall not be included in the
determination  of benefits under any employee pension benefit plan (as such term
is defined in Section 3(2) of the  Employee  Retirement  Income  Security Act of
1974) or group  insurance or other benefit plans  applicable to the  Participant
that are maintained by the Company or any of its subsidiaries,  except as may be
provided under the terms of such plans or determined by resolution of the Board.

         8.11 GOVERNING LAW. Except to the extent required by Delaware corporate
law, the Plan and all determinations made and actions taken pursuant to the Plan
shall be governed  by the laws of the State of New York other than the  conflict
of laws provisions of such laws, and shall be construed in accordance therewith.

         8.12 NO STRICT  CONSTRUCTION.  No rule of strict  construction shall be
implied  against  the  Company,  the  Committee,  or  any  other  person  in the
interpretation of any of the terms of the Plan, any Award granted under the Plan
or any rule or procedure established by the Committee.

         8.13 CAPTIONS.  The captions (i.e.,  all Section and Article  headings)
used in the Plan are for convenience only, do not constitute a part of the Plan,
and  shall  not be  deemed  to  limit,  characterize  or  affect  in any way any
provisions of the Plan,  and all provisions of the Plan shall be construed as if
no captions have been used in the Plan.

         8.14 SEVERABILITY.  Whenever  possible,  each provision in the Plan and
every  Award at any time  granted  under the Plan shall be  interpreted  in such
manner as to be effective and valid under  applicable  law, but if any provision
of the Plan or any Award at any time granted  under the Plan shall be held to be
prohibited by or invalid under  applicable law, then (a) such provision shall be
deemed  amended to  accomplish  the  objectives  of the  provision as originally
written to the fullest extent  permitted by law and (b) all other  provisions of
the Plan and every other Award at any time  granted  under the Plan shall remain
in full force and effect.



<PAGE>




         8.15 LEGENDS.  All  certificates  for Common Stock  delivered under the
Plan shall be subject to such  transfer  restrictions  set forth in the Plan and
such other  restrictions  as the Committee may deem  advisable  under the rules,
regulations and other  requirements  of the Securities and Exchange  Commission,
any stock exchange upon which the Common Stock is then listed and any applicable
federal or state securities law, and the Committee may cause a legend or legends
to be put on any  such  certificates  to  make  appropriate  references  to such
restrictions.

         8.16     AMENDMENT AND TERMINATION.
         (a)  Amendment.  The Board shall have  complete  power and authority to
         amend  the  Plan at any time it is  deemed  necessary  or  appropriate;
         provided,  however,  that the Board shall not,  without the affirmative
         approval of the holder of Company Voting Securities, make any amendment
         that requires  stockholder  approval  under the Code or under any other
         applicable  law,  unless the Board  determines that compliance with the
         Code or such other applicable law is no longer desired.  No termination
         or amendment of the Plan may, without the consent of the Participant to
         whom any Award  shall  theretofore  have been  granted  under the Plan,
         adversely  affect  the  right  of such  individual  under  such  Award;
         provided, however, that the Committee may, in its sole discretion, make
         such provision in the Award Agreement for amendments  that, in its sole
         discretion, it deems appropriate.

         Termination. The Board shall have the right and the power to  terminate
                  the Plan at any time. No Award shall be granted under the Plan
                  after the  termination of the Plan, but the termination of the
                  Plan shall not have any other effect and any Award outstanding
                  at the time of the  termination  of the Plan may be  exercised
                  after  termination  of the  Plan  at  any  time  prior  to the
                  expiration  date of such Award to the same  extent  such Award
                  would have been exercisable had the Plan not terminated.



<PAGE>


                               OPTION CERTIFICATE

                             INCENTIVE STOCK OPTION
                                (Non-Assignable)

                                                                   40,000 Shares

                       To Purchase Class A Common Stock of
                             BULL & BEAR GROUP, INC.

                 Issued Pursuant to the Bull & Bear Group, Inc.
                        1995 Long-Term Incentive Plan (as
                  Amended and Restated as of October 29, 1997)

                  THIS  CERTIFIES  that on October 29, 1997,  Bassett S. Winmill
(the "Holder") was granted an option  ("Option") to purchase at the Option price
of $2.475  per share all or any part of  40,000  fully  paid and  non-assessable
shares ("Shares") of the Class A Common Stock, par value $.01 per share, of BULL
& BEAR GROUP, INC. ("Corporation"),  a Delaware corporation, upon and subject to
the following terms and conditions.

                  This Option shall expire on October 28, 2002.

                  This  Option  may  be  exercised  or  surrendered  during  the
Holder's  lifetime only by the Holder.  This Option shall not be transferable by
the Holder otherwise than by will or by the laws of descent and distribution.

                  Except  as  otherwise  provided  pursuant  to the  Bull & Bear
Group, Inc. 1995 Long-Term Incentive Plan (as Amended and Restated as of October
29,  1997) (the  "Plan"),  this Option may be exercised in whole or in part with
respect to 100% of the Shares  subject to this  Option on and after the later of
(i) the date of grant of this  Option or (ii) the date on which the  Holder  has
completed  two  years  of  employment   with  the  Corporation  or  any  of  its
subsidiaries.  In no event,  however,  may this  Option be  exercised  after the
Option's expiration date.

                  Upon any  exercise  of this  Option,  payment of the  purchase
price for the Shares to be purchased pursuant to such exercise shall be made (i)
in cash or by check to the order of the Corporation, (ii) by the delivery to the
Corporation of Shares already owned by the Holder,  which Shares shall be valued
at their fair  market  value on the date of  exercise  of the  Option,  (iii) if
permitted by the Committee  under the Plan,  by delivering to the  Corporation a
recourse  promissory note in accordance with and subject to the terms of Section
8.07 of the Plan, or (iv) by any combination of the foregoing.

                  The Option and this Option  certificate are issued pursuant to
and are subject to all of the terms and  conditions  of the Plan,  the terms and
conditions of which are hereby  incorporated as though set forth at length and a
copy of which is attached hereto.

                  WITNESS the  signature of the  Corporation's  duly  authorized
officer.

Dated as of October 29, 1997

                                                   BULL & BEAR GROUP, INC.


                                                   By:/s/ Thomas B. Winmill

                                       55

<PAGE>


                               OPTION CERTIFICATE

                           NON-QUALIFIED STOCK OPTION
                                (Non-Assignable)

                                                                    5,000 Shares

                       To Purchase Class A Common Stock of
                             BULL & BEAR GROUP, INC.

                 Issued Pursuant to the Bull & Bear Group, Inc.
                        1995 Long-Term Incentive Plan (as
                  Amended and Restated as of October 29, 1997)


                  THIS CERTIFIES  that on October 29, 1997,  Edward G. Webb, Jr.
(the "Holder") was granted an option ("Option"), which is not an incentive stock
option,  to purchase  at the Option  price of $2.25 per share all or any part of
5,000  fully paid and  non-assessable  shares  ("Shares")  of the Class A Common
Stock, par value $.01 per share, of BULL & BEAR GROUP, INC.  ("Corporation"),  a
Delaware corporation, upon and subject to the following terms and conditions.

                  This Option shall expire on October 28, 2002.

                  This  Option  may  be  exercised  or  surrendered  during  the
Holder's  lifetime only by the Holder.  This Option shall not be transferable by
the Holder otherwise than by will or by the laws of descent and distribution.

                  Except  as  otherwise  provided  pursuant  to the  Bull & Bear
Group, Inc. 1995 Long-Term Incentive Plan (as Amended and Restated as of October
29,  1997) (the  "Plan"),  this Option may be exercised in whole or in part with
respect to 100% of the Shares  subject to this  Option on and after the later of
(i) the date of grant of this  Option or (ii) the date on which the  Holder  has
completed two years of employment  with, or service as a  non-employee  director
of, the Corporation.  In no event,  however,  may this Option be exercised after
the Option's expiration date.

                  Upon any  exercise  of this  Option,  payment of the  purchase
price for the Shares to be purchased pursuant to such exercise shall be made (i)
in cash or by check to the order of the Corporation, (ii) by the delivery to the
Corporation of Shares already owned by the Holder,  which Shares shall be valued
at their fair market  value on the date of  exercise of the Option,  or (iii) by
any combination of the foregoing.

                  The Option and this Option  certificate are issued pursuant to
and are subject to all of the terms and  conditions  of the Plan,  the terms and
conditions of which are hereby  incorporated as though set forth at length and a
copy of which is attached hereto.

                  WITNESS the  signature of the  Corporation's  duly  authorized
officer.

Dated as of October 29, 1997


                                                  BULL & BEAR GROUP, INC.



                                                  By:/s/ Thomas B. Winmill


                                       56

<PAGE>


                               OPTION CERTIFICATE

                           NON-QUALIFIED STOCK OPTION
                                (Non-Assignable)

                                                                    5,000 Shares

                       To Purchase Class A Common Stock of
                             BULL & BEAR GROUP, INC.

                 Issued Pursuant to the Bull & Bear Group, Inc.
                        1995 Long-Term Incentive Plan (as
                  Amended and Restated as of October 29, 1997)


                  THIS  CERTIFIES  that on October 29, 1997,  Charles A. Carroll
(the "Holder") was granted an option ("Option"), which is not an incentive stock
option,  to purchase  at the Option  price of $2.25 per share all or any part of
5,000  fully paid and  non-assessable  shares  ("Shares")  of the Class A Common
Stock, par value $.01 per share, of BULL & BEAR GROUP, INC.  ("Corporation"),  a
Delaware corporation, upon and subject to the following terms and conditions.

                  This Option shall expire on October 28, 2002.

                  This  Option  may  be  exercised  or  surrendered  during  the
Holder's  lifetime only by the Holder.  This Option shall not be transferable by
the Holder otherwise than by will or by the laws of descent and distribution.

                  Except  as  otherwise  provided  pursuant  to the  Bull & Bear
Group, Inc. 1995 Long-Term Incentive Plan (as Amended and Restated as of October
29,  1997) (the  "Plan"),  this Option may be exercised in whole or in part with
respect to 100% of the Shares  subject to this  Option on and after the later of
(i) the date of grant of this  Option or (ii) the date on which the  Holder  has
completed two years of employment  with, or service as a  non-employee  director
of, the Corporation.  In no event,  however,  may this Option be exercised after
the Option's expiration date.

                  Upon any  exercise  of this  Option,  payment of the  purchase
price for the Shares to be purchased pursuant to such exercise shall be made (i)
in cash or by check to the order of the Corporation, (ii) by the delivery to the
Corporation of Shares already owned by the Holder,  which Shares shall be valued
at their fair market  value on the date of  exercise of the Option,  or (iii) by
any combination of the foregoing.

                  The Option and this Option  certificate are issued pursuant to
and are subject to all of the terms and  conditions  of the Plan,  the terms and
conditions of which are hereby  incorporated as though set forth at length and a
copy of which is attached hereto.

                  WITNESS the  signature of the  Corporation's  duly  authorized
officer.

Dated as of October 29, 1997


                                                   BULL & BEAR GROUP, INC.


                                                   By:/s/ Thomas B. Winmill


                                       57


<PAGE>



                               OPTION CERTIFICATE

                             INCENTIVE STOCK OPTION
                                (Non-Assignable)

                                                                   40,000 Shares

                       To Purchase Class A Common Stock of
                             BULL & BEAR GROUP, INC.

                 Issued Pursuant to the Bull & Bear Group, Inc.
                        1995 Long-Term Incentive Plan (as
                  Amended and Restated as of October 29, 1997)

                  THIS  CERTIFIES  that on October 29,  1997,  Thomas B. Winmill
(the "Holder") was granted an option  ("Option") to purchase at the Option price
of $2.475  per share all or any part of  40,000  fully  paid and  non-assessable
shares ("Shares") of the Class A Common Stock, par value $.01 per share, of BULL
& BEAR GROUP, INC. ("Corporation"),  a Delaware corporation, upon and subject to
the following terms and conditions.

                  This Option shall expire on October 28, 2002.

                  This  Option  may  be  exercised  or  surrendered  during  the
Holder's  lifetime only by the Holder.  This Option shall not be transferable by
the Holder otherwise than by will or by the laws of descent and distribution.

                  Except  as  otherwise  provided  pursuant  to the  Bull & Bear
Group, Inc. 1995 Long-Term Incentive Plan (as Amended and Restated as of October
29,  1997) (the  "Plan"),  this Option may be exercised in whole or in part with
respect to 100% of the Shares  subject to this  Option on and after the later of
(i) the date of grant of this  Option or (ii) the date on which the  Holder  has
completed  two  years  of  employment   with  the  Corporation  or  any  of  its
subsidiaries.  In no event,  however,  may this  Option be  exercised  after the
Option's expiration date.

                  Upon any  exercise  of this  Option,  payment of the  purchase
price for the Shares to be purchased pursuant to such exercise shall be made (i)
in cash or by check to the order of the Corporation, (ii) by the delivery to the
Corporation of Shares already owned by the Holder,  which Shares shall be valued
at their fair  market  value on the date of  exercise  of the  Option,  (iii) if
permitted by the Committee  under the Plan,  by delivering to the  Corporation a
recourse  promissory note in accordance with and subject to the terms of Section
8.07 of the Plan, or (iv) by any combination of the foregoing.

                  The Option and this Option  certificate are issued pursuant to
and are subject to all of the terms and  conditions  of the Plan,  the terms and
conditions of which are hereby  incorporated as though set forth at length and a
copy of which is attached hereto.

                  WITNESS the  signature of the  Corporation's  duly  authorized
officer.

Dated as of October 29, 1997

                                                    BULL & BEAR GROUP, INC.


                                                    By:/s/ Thomas B. Winmill


                                       58

<PAGE>


                               OPTION CERTIFICATE

                             INCENTIVE STOCK OPTION
                                (Non-Assignable)

                                                                   40,000 Shares

                       To Purchase Class A Common Stock of
                             BULL & BEAR GROUP, INC.

                 Issued Pursuant to the Bull & Bear Group, Inc.
                        1995 Long-Term Incentive Plan (as
                  Amended and Restated as of October 29, 1997)

                  THIS CERTIFIES that on October 29, 1997,  Mark C. Winmill (the
"Holder")  was granted an option  ("Option")  to purchase at the Option price of
$2.475 per share all or any part of 40,000 fully paid and non-assessable  shares
("Shares") of the Class A Common Stock, par value $.01 per share, of BULL & BEAR
GROUP, INC.  ("Corporation"),  a Delaware  corporation,  upon and subject to the
following terms and conditions.

                  This Option shall expire on October 28, 2002.

                  This  Option  may  be  exercised  or  surrendered  during  the
Holder's  lifetime only by the Holder.  This Option shall not be transferable by
the Holder otherwise than by will or by the laws of descent and distribution.

                  Except  as  otherwise  provided  pursuant  to the  Bull & Bear
Group, Inc. 1995 Long-Term Incentive Plan (as Amended and Restated as of October
29,  1997) (the  "Plan"),  this Option may be exercised in whole or in part with
respect to 100% of the Shares  subject to this  Option on and after the later of
(i) the date of grant of this  Option or (ii) the date on which the  Holder  has
completed  two  years  of  employment   with  the  Corporation  or  any  of  its
subsidiaries.  In no event,  however,  may this  Option be  exercised  after the
Option's expiration date.

                  Upon any  exercise  of this  Option,  payment of the  purchase
price for the Shares to be purchased pursuant to such exercise shall be made (i)
in cash or by check to the order of the Corporation, (ii) by the delivery to the
Corporation of Shares already owned by the Holder,  which Shares shall be valued
at their fair  market  value on the date of  exercise  of the  Option,  (iii) if
permitted by the Committee  under the Plan,  by delivering to the  Corporation a
recourse  promissory note in accordance with and subject to the terms of Section
8.07 of the Plan, or (iv) by any combination of the foregoing.

                  The Option and this Option  certificate are issued pursuant to
and are subject to all of the terms and  conditions  of the Plan,  the terms and
conditions of which are hereby  incorporated as though set forth at length and a
copy of which is attached hereto.

                  WITNESS the  signature of the  Corporation's  duly  authorized
officer.

Dated as of October 29, 1997

                                                  BULL & BEAR GROUP, INC.


                                                  By:/s/ Thomas B. Winmill


                                       59

<PAGE>


                               OPTION CERTIFICATE

                             INCENTIVE STOCK OPTION
                                (Non-Assignable)

                                                                    5,000 Shares

                       To Purchase Class A Common Stock of
                             BULL & BEAR GROUP, INC.

                 Issued Pursuant to the Bull & Bear Group, Inc.
                        1995 Long-Term Incentive Plan (as
                  Amended and Restated as of October 29, 1997)

                  THIS  CERTIFIES  that on October 29, 1997,  Robert D. Anderson
(the "Holder") was granted an option  ("Option") to purchase at the Option price
of $2.25 per share all or any part of 5,000 fully paid and non-assessable shares
("Shares") of the Class A Common Stock, par value $.01 per share, of BULL & BEAR
GROUP, INC.  ("Corporation"),  a Delaware  corporation,  upon and subject to the
following terms and conditions.

                  This Option shall expire on October 28, 2002.

                  This  Option  may  be  exercised  or  surrendered  during  the
Holder's  lifetime only by the Holder.  This Option shall not be transferable by
the Holder otherwise than by will or by the laws of descent and distribution.

                  Except  as  otherwise  provided  pursuant  to the  Bull & Bear
Group, Inc. 1995 Long-Term Incentive Plan (as Amended and Restated as of October
29,  1997) (the  "Plan"),  this Option may be exercised in whole or in part with
respect to 100% of the Shares  subject to this  Option on and after the later of
(i) the date of grant of this  Option or (ii) the date on which the  Holder  has
completed  two  years  of  employment   with  the  Corporation  or  any  of  its
subsidiaries.  In no event,  however,  may this  Option be  exercised  after the
Option's expiration date.

                  Upon any  exercise  of this  Option,  payment of the  purchase
price for the Shares to be purchased pursuant to such exercise shall be made (i)
in cash or by check to the order of the Corporation, (ii) by the delivery to the
Corporation of Shares already owned by the Holder,  which Shares shall be valued
at their fair  market  value on the date of  exercise  of the  Option,  (iii) if
permitted by the Committee  under the Plan,  by delivering to the  Corporation a
recourse  promissory note in accordance with and subject to the terms of Section
8.07 of the Plan, or (iv) by any combination of the foregoing.

                  The Option and this Option  certificate are issued pursuant to
and are subject to all of the terms and  conditions  of the Plan,  the terms and
conditions of which are hereby  incorporated as though set forth at length and a
copy of which is attached hereto.

                  WITNESS the  signature of the  Corporation's  duly  authorized
officer.

Dated as of October 29, 1997

                                                  BULL & BEAR GROUP, INC.


                                                  By:/s/ Thomas B. Winmill


                                       60

<PAGE>



                         NON-EXCLUSIVE LICENSE AGREEMENT



         AGREEMENT dated as of March 4, 1998 between BULL & BEAR GROUP,  INC., a
Delaware  corporation (the "Licensor") and BULL & BEAR FUNDS I, INC., a Maryland
corporation (the "Licensee").

                               W I T N E S S E T H

         WHEREAS,  the Licensor is the owner of all right, title and interest in
and to the service  marks listed on Schedule A hereto,  as such  Schedule may be
amended  from  time  to  time,  (hereinafter  collectively  referred  to as  the
"Licensed Marks"), and

         WHEREAS, the Licensee has requested a non-exclusive license to use the
         Licensed Marks in connection with its corporate activities,

         NOW, THEREFORE, the parties hereto agree as follows:

1.       The Licensor grants to the Licensee the non-exclusive  right to use the
         Licensed  Marks in  connection  with its  activities  as an  investment
         company.

2.       The  grant  of the  license  provided  for in  paragraph  1  herein  is
         personal,  indivisible,  non-exclusive and not subject to succession or
         transfer.

3.       The  Licensee  agrees to follow  all rules  reasonably  imposed  by the
         Licensor to protect the Licensor's rights in the Licensed Marks.

4.       The  Licensee  agrees  that the  nature  and  quality  of all  services
         rendered by the Licensee in  connection  with the Licensed  Marks shall
         conform to standards  set by the  Licensor and be under  control of the
         Licensor.

5.       The license  provided for in this  Agreement  may be  terminated in the
         event the  Investment  Manager of the Licensee shall not be Bull & Bear
         Advisers, Inc. or some other corporation controlling, controlled by, or
         under the common control of the Licensor.

6.       In the event of termination as provided for in paragraph 5 herein,  the
         Licensee  agrees  to  promptly  do all such  acts and  things as may be
         necessary to terminate  its use of the Licensed  Marks and will,  after
         such  termination,  make no further  reference to the Licensed Marks or
         any confusingly similar term in its business.

7.       The  Licensor  and the  Licensee  agree to do all such further acts and
         things to effect the purposes of this Agreement.

1.
8.       The  representations  and  warranties  contained  herein shall continue
         after and survive the  termination of this  Agreement.  No provision of
         this  Agreement  may be amended or modified  in any manner  except by a
         written  agreement  properly  authorized  and  executed  by each  party
         hereto.  This agreement may not be assigned by the Licensee without the
         prior written consent of the Licensor, although the Licensor may assign
         this  Agreement at any time without  notice or penalty.  Subject to the
         Licensee's Articles of Incorporation,  with such amendments, if any, as
         may be in effect as of the date hereof,  this Agreement  supersedes any
         prior agreement between the parties.



<PAGE>



         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.

                             BULL & BEAR GROUP, INC.

                            By:/s/ Robert D. Anderson



                            BULL & BEAR FUNDS I, INC.


                            By:/s/ Thomas B. Winmill



<PAGE>


                                   Schedule A



1.     Bull & Bear Performance Account

2.     Bull & Bear Performance Plus Account

3.     Performance

4.     Bull & Bear

5.     Performance Driven

6.     Bull & Bear Performance Driven

7.     Bull & Bear Stockfax

9.     Bull & Bear No-Fee IRA

10.    Performance Plus

<PAGE>



                         NON-EXCLUSIVE LICENSE AGREEMENT



         AGREEMENT dated as of March 4, 1998 between BULL & BEAR GROUP,  INC., a
Delaware corporation (the "Licensor") and BULL & BEAR FUNDS II, INC., a Maryland
corporation (the "Licensee").

                               W I T N E S S E T H

         WHEREAS,  the Licensor is the owner of all right, title and interest in
and to the service  marks listed on Schedule A hereto,  as such  Schedule may be
amended  from  time  to  time,  (hereinafter  collectively  referred  to as  the
"Licensed Marks"), and

         WHEREAS, the Licensee has requested a non-exclusive license to use the
         Licensed Marks in connection with its corporate activities,

         NOW, THEREFORE, the parties hereto agree as follows:

1.       The Licensor grants to the Licensee the non-exclusive  right to use the
         Licensed  Marks in  connection  with its  activities  as an  investment
         company.

2.       The  grant  of the  license  provided  for in  paragraph  1  herein  is
         personal,  indivisible,  non-exclusive and not subject to succession or
         transfer.

3.       The  Licensee  agrees to follow  all rules  reasonably  imposed  by the
         Licensor to protect the Licensor's rights in the Licensed Marks.

4.       The  Licensee  agrees  that the  nature  and  quality  of all  services
         rendered by the Licensee in  connection  with the Licensed  Marks shall
         conform to standards  set by the  Licensor and be under  control of the
         Licensor.

5.       The license  provided for in this  Agreement  may be  terminated in the
         event the  Investment  Manager of the Licensee shall not be Bull & Bear
         Advisers, Inc. or some other corporation controlling, controlled by, or
         under the common control of the Licensor.

6.       In the event of termination as provided for in paragraph 5 herein,  the
         Licensee  agrees  to  promptly  do all such  acts and  things as may be
         necessary to terminate  its use of the Licensed  Marks and will,  after
         such  termination,  make no further  reference to the Licensed Marks or
         any confusingly similar term in its business.

7.       The  Licensor  and the  Licensee  agree to do all such further acts and
         things to effect the purposes of this Agreement.

8.       The  representations  and  warranties  contained  herein shall continue
         after and survive the  termination of this  Agreement.  No provision of
         this  Agreement  may be amended or modified  in any manner  except by a
         written  agreement  properly  authorized  and  executed  by each  party
         hereto.  This agreement may not be assigned by the Licensee without the
         prior written consent of the Licensor, although the Licensor may assign
         this  Agreement at any time without  notice or penalty.  Subject to the
         Licensee's Articles of Incorporation,  with such amendments, if any, as
         may be in effect as of the date hereof,  this Agreement  supersedes any
         prior agreement between the parties.


<PAGE>


         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.

                             BULL & BEAR GROUP, INC.


                            By:/s/ Robert D. Anderson



                           BULL & BEAR FUNDS II, INC.


                            By:/s/ Thomas B. Winmill




<PAGE>


                                   Schedule A



1.     Bull & Bear Performance Account

2.     Bull & Bear Performance Plus Account

3.     Performance

4.     Bull & Bear

5.     Performance Driven

6.     Bull & Bear Performance Driven

7.     Bull & Bear Stockfax

9.     Bull & Bear No-Fee IRA

10.    Performance Plus

<PAGE>



                         NON-EXCLUSIVE LICENSE AGREEMENT



         AGREEMENT dated as of March 4, 1998 between BULL & BEAR GROUP,  INC., a
Delaware  corporation  (the  "Licensor")  and BULL & BEAR GOLD INVESTORS LTD., a
Maryland corporation (the "Licensee").

                               W I T N E S S E T H

         WHEREAS,  the Licensor is the owner of all right, title and interest in
and to the service  marks listed on Schedule A hereto,  as such  Schedule may be
amended  from  time  to  time,  (hereinafter  collectively  referred  to as  the
"Licensed Marks"), and

         WHEREAS, the Licensee has requested a non-exclusive license to use the
         Licensed Marks in connection with its corporate activities,

         NOW, THEREFORE, the parties hereto agree as follows:

1.       The Licensor grants to the Licensee the non-exclusive  right to use the
         Licensed  Marks in  connection  with its  activities  as an  investment
         company.

2.       The  grant  of the  license  provided  for in  paragraph  1  herein  is
         personal,  indivisible,  non-exclusive and not subject to succession or
         transfer.

3.       The  Licensee  agrees to follow  all rules  reasonably  imposed  by the
         Licensor to protect the Licensor's rights in the Licensed Marks.

4.       The  Licensee  agrees  that the  nature  and  quality  of all  services
         rendered by the Licensee in  connection  with the Licensed  Marks shall
         conform to standards  set by the  Licensor and be under  control of the
         Licensor.

5.       The license  provided for in this  Agreement  may be  terminated in the
         event the  Investment  Manager of the Licensee shall not be Bull & Bear
         Advisers, Inc. or some other corporation controlling, controlled by, or
         under the common control of the Licensor.

6.       In the event of termination as provided for in paragraph 5 herein,  the
         Licensee  agrees  to  promptly  do all such  acts and  things as may be
         necessary to terminate  its use of the Licensed  Marks and will,  after
         such  termination,  make no further  reference to the Licensed Marks or
         any confusingly similar term in its business.

7.       The  Licensor  and the  Licensee  agree to do all such further acts and
         things to effect the purposes of this Agreement.

8.       The  representations  and  warranties  contained  herein shall continue
         after and survive the  termination of this  Agreement.  No provision of
         this  Agreement  may be amended or modified  in any manner  except by a
         written  agreement  properly  authorized  and  executed  by each  party
         hereto.  This agreement may not be assigned by the Licensee without the
         prior written consent of the Licensor, although the Licensor may assign
         this  Agreement at any time without  notice or penalty.  Subject to the
         Licensee's Articles of Incorporation,  with such amendments, if any, as
         may be in effect as of the date hereof,  this Agreement  supersedes any
         prior agreement between the parties.



<PAGE>



         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.


                             BULL & BEAR GROUP, INC.


                            By:/s/ Robert D. Anderson



                         BULL & BEAR GOLD INVESTORS LTD.


                            By:/s/ Thomas B. Winmill



<PAGE>


                                   Schedule A



1.     Bull & Bear Performance Account

2.     Bull & Bear Performance Plus Account

3.     Performance

4.     Bull & Bear

5.     Performance Driven

6.     Bull & Bear Performance Driven

7.     Bull & Bear Stockfax

9.     Bull & Bear No-Fee IRA

10.    Performance Plus

<PAGE>


                         NON-EXCLUSIVE LICENSE AGREEMENT



         AGREEMENT dated as of March 4, 1998 between BULL & BEAR GROUP,  INC., a
Delaware  corporation (the "Licensor") and BULL & BEAR GLOBAL INCOME FUND, INC.,
a Maryland corporation (the "Licensee").

                               W I T N E S S E T H

         WHEREAS,  the Licensor is the owner of all right, title and interest in
and to the service  marks listed on Schedule A hereto,  as such  Schedule may be
amended  from  time  to  time,  (hereinafter  collectively  referred  to as  the
"Licensed Marks"), and

         WHEREAS, the Licensee has requested a non-exclusive license to use the
         Licensed Marks in connection with its corporate activities,

         NOW, THEREFORE, the parties hereto agree as follows:

1.       The Licensor grants to the Licensee the non-exclusive  right to use the
         Licensed  Marks in  connection  with its  activities  as an  investment
         company.

2.       The  grant  of the  license  provided  for in  paragraph  1  herein  is
         personal,  indivisible,  non-exclusive and not subject to succession or
         transfer.

3.       The  Licensee  agrees to follow  all rules  reasonably  imposed  by the
         Licensor to protect the Licensor's rights in the Licensed Marks.

4.       The  Licensee  agrees  that the  nature  and  quality  of all  services
         rendered by the Licensee in  connection  with the Licensed  Marks shall
         conform to standards  set by the  Licensor and be under  control of the
         Licensor.

5.       The license may be withdrawn  by the Licensor at any time,  in its sole
         discretion  and without prior notice,  in which case the Licensee shall
         have no further  right  whatsoever  to use the  Licensed  Marks and the
         Licensee's  shareholders,  officers and directors  shall  promptly take
         whatever  action may be necessary to eliminate all use of and reference
         to the Licensed Marks in the Licensor's name and otherwise.

6.       In the event of termination as provided for in paragraph 5 herein,  the
         Licensee  agrees  to  promptly  do all such  acts and  things as may be
         necessary to terminate  its use of the Licensed  Marks and will,  after
         such  termination,  make no further  reference to the Licensed Marks or
         any confusingly similar term in its business.

7.       The  Licensor  and the  Licensee  agree to do all such further acts and
         things to effect the purposes of this Agreement.

8.       The  representations  and  warranties  contained  herein shall continue
         after and survive the  termination of this  Agreement.  No provision of
         this  Agreement  may be amended or modified  in any manner  except by a
         written  agreement  properly  authorized  and  executed  by each  party
         hereto.  This agreement may not be assigned by the Licensee without the
         prior written consent of the Licensor, although the Licensor may assign
         this  Agreement at any time without  notice or penalty.  Subject to the
         Licensee's Articles of Incorporation,  with such amendments, if any, as
         may be in effect as of the date hereof,  this Agreement  supersedes any
         prior agreement between the parties.



<PAGE>



         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.


                             BULL & BEAR GROUP, INC.


                            By:/s/ Robert D. Anderson



                      BULL & BEAR GLOBAL INCOME FUND, INC.


                            By:/s/ Thomas B. Winmill


<PAGE>


                                   Schedule A



1.     Bull & Bear Performance Account

2.     Bull & Bear Performance Plus Account

3.     Performance

4.     Bull & Bear

5.     Performance Driven

6.     Bull & Bear Performance Driven

7.     Bull & Bear Stockfax

9.     Bull & Bear No-Fee IRA

10.    Performance Plus


<PAGE>



                         NON-EXCLUSIVE LICENSE AGREEMENT



         AGREEMENT dated as of March 4, 1998 between BULL & BEAR GROUP,  INC., a
Delaware   corporation  (the  "Licensor")  and  MIDAS  FUND,  INC.,  a  Maryland
corporation (the "Licensee").

                               W I T N E S S E T H

         WHEREAS,  the Licensor is the owner of all right, title and interest in
and to the service  marks listed on Schedule A hereto,  as such  Schedule may be
amended  from  time  to  time,  (hereinafter  collectively  referred  to as  the
"Licensed Marks"), and

         WHEREAS, the Licensee has requested a non-exclusive license to use the
         Licensed Marks in connection with its corporate activities,

         NOW, THEREFORE, the parties hereto agree as follows:

1.       The Licensor grants to the Licensee the non-exclusive  right to use the
         Licensed  Marks in  connection  with its  activities  as an  investment
         company.

2.       The  grant  of the  license  provided  for in  paragraph  1  herein  is
         personal,  indivisible,  non-exclusive and not subject to succession or
         transfer.

3.       The  Licensee  agrees to follow  all rules  reasonably  imposed  by the
         Licensor to protect the Licensor's rights in the Licensed Marks.

4.       The  Licensee  agrees  that the  nature  and  quality  of all  services
         rendered by the Licensee in  connection  with the Licensed  Marks shall
         conform to standards  set by the  Licensor and be under  control of the
         Licensor.

5.       The license may be withdrawn  by the Licensor at any time,  in its sole
         discretion  and without prior notice,  in which case the Licensee shall
         have no further  right  whatsoever  to use the  Licensed  Marks and the
         Licensee's  shareholders,  officers and directors  shall  promptly take
         whatever  action may be necessary to eliminate all use of and reference
         to the Licensed Marks in the Licensor's name and otherwise.

6.       In the event of termination as provided for in paragraph 5 herein,  the
         Licensee  agrees  to  promptly  do all such  acts and  things as may be
         necessary to terminate  its use of the Licensed  Marks and will,  after
         such  termination,  make no further  reference to the Licensed Marks or
         any confusingly similar term in its business.

7.       The  Licensor  and the  Licensee  agree to do all such further acts and
         things to effect the purposes of this Agreement.

8.       The  representations  and  warranties  contained  herein shall continue
         after and survive the  termination of this  Agreement.  No provision of
         this  Agreement  may be amended or modified  in any manner  except by a
         written  agreement  properly  authorized  and  executed  by each  party
         hereto.  This agreement may not be assigned by the Licensee without the
         prior written consent of the Licensor, although the Licensor may assign
         this  Agreement at any time without  notice or penalty.  Subject to the
         Licensee's Articles of Incorporation,  with such amendments, if any, as
         may be in effect as of the date hereof,  this Agreement  supersedes any
         prior agreement between the parties.


<PAGE>


         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.


                             BULL & BEAR GROUP, INC.


                            By:/s/ Robert D. Anderson



                                MIDAS FUND, INC.


                            By:/s/ Thomas B. Winmill



<PAGE>


                                   Schedule A



Bull & Bear Performance Account

Bull & Bear Performance Plus Account

Performance

Bull & Bear

Performance Driven

Bull & Bear Performance Driven

Bull & Bear Stockfax

Bull & Bear No-Fee IRA

Performance Plus


<PAGE>


                         NON-EXCLUSIVE LICENSE AGREEMENT



         AGREEMENT dated as of March 4, 1998 between BULL & BEAR GROUP,  INC., a
Delaware  corporation  (the  "Licensor") and BULL & BEAR MUNICIPAL  INCOME FUND,
INC., a Maryland corporation (the "Licensee").

                               W I T N E S S E T H

         WHEREAS,  the Licensor is the owner of all right, title and interest in
and to the service  marks listed on Schedule A hereto,  as such  Schedule may be
amended  from  time  to  time,  (hereinafter  collectively  referred  to as  the
"Licensed Marks"), and

         WHEREAS, the Licensee has requested a non-exclusive license to use the
         Licensed Marks in connection with its corporate activities,

         NOW, THEREFORE, the parties hereto agree as follows:

1.       The Licensor grants to the Licensee the non-exclusive  right to use the
         Licensed  Marks in  connection  with its  activities  as an  investment
         company.

2.       The  grant  of the  license  provided  for in  paragraph  1  herein  is
         personal,  indivisible,  non-exclusive and not subject to succession or
         transfer.

3.       The  Licensee  agrees to follow  all rules  reasonably  imposed  by the
         Licensor to protect the Licensor's rights in the Licensed Marks.

4.       The  Licensee  agrees  that the  nature  and  quality  of all  services
         rendered by the Licensee in  connection  with the Licensed  Marks shall
         conform to standards  set by the  Licensor and be under  control of the
         Licensor.

5.       The license may be withdrawn  by the Licensor at any time,  in its sole
         discretion  and without prior notice,  in which case the Licensee shall
         have no further  right  whatsoever  to use the  Licensed  Marks and the
         Licensee's  shareholders,  officers and directors  shall  promptly take
         whatever  action may be necessary to eliminate all use of and reference
         to the Licensed Marks in the Licensor's name and otherwise.

6.       In the event of termination as provided for in paragraph 5 herein,  the
         Licensee  agrees  to  promptly  do all such  acts and  things as may be
         necessary to terminate  its use of the Licensed  Marks and will,  after
         such  termination,  make no further  reference to the Licensed Marks or
         any confusingly similar term in its business.

7.       The  Licensor  and the  Licensee  agree to do all such further acts and
         things to effect the purposes of this Agreement.

8.       The  representations  and  warranties  contained  herein shall continue
         after and survive the  termination of this  Agreement.  No provision of
         this  Agreement  may be amended or modified  in any manner  except by a
         written  agreement  properly  authorized  and  executed  by each  party
         hereto.  This agreement may not be assigned by the Licensee without the
         prior written consent of the Licensor, although the Licensor may assign
         this  Agreement at any time without  notice or penalty.  Subject to the
         Licensee's Articles of Incorporation,  with such amendments, if any, as
         may be in effect as of the date hereof,  this Agreement  supersedes any
         prior agreement between the parties.


<PAGE>



         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.


                             BULL & BEAR GROUP, INC.


                            By:/s/ Robert D. Anderson



                     BULL & BEAR MUNICIPAL INCOME FUND, INC.


                            By:/s/ Thomas B. Winmill



<PAGE>


                                   Schedule A



1.   Bull & Bear Performance Account

2.   Bull & Bear Performance Plus Account

3.   Performance

4.   Bull & Bear

5.   Performance Driven

6.   Bull & Bear Performance Driven

7.   Bull & Bear Stockfax

8.   Bull & Bear No-Fee IRA

9.   Performance Plus


<PAGE>



                         NON-EXCLUSIVE LICENSE AGREEMENT



         AGREEMENT dated as of March 4, 1998 between BULL & BEAR GROUP,  INC., a
Delaware  corporation  (the  "Licensor")  and  ROCKWOOD  FUND,  INC., a Maryland
corporation (the "Licensee").

                               W I T N E S S E T H

         WHEREAS,  the Licensor is the owner of all right, title and interest in
and to the service  marks listed on Schedule A hereto,  as such  Schedule may be
amended  from  time  to  time,  (hereinafter  collectively  referred  to as  the
"Licensed Marks"), and

         WHEREAS, the Licensee has requested a non-exclusive license to use the
         Licensed Marks in connection with its corporate activities,

         NOW, THEREFORE, the parties hereto agree as follows:

1.       The Licensor grants to the Licensee the non-exclusive  right to use the
         Licensed  Marks in  connection  with its  activities  as an  investment
         company.

2.       The  grant  of the  license  provided  for in  paragraph  1  herein  is
         personal,  indivisible,  non-exclusive and not subject to succession or
         transfer.

3.       The  Licensee  agrees to follow  all rules  reasonably  imposed  by the
         Licensor to protect the Licensor's rights in the Licensed Marks.

4.       The  Licensee  agrees  that the  nature  and  quality  of all  services
         rendered by the Licensee in  connection  with the Licensed  Marks shall
         conform to standards  set by the  Licensor and be under  control of the
         Licensor.

5.       The license may be withdrawn  by the Licensor at any time,  in its sole
         discretion  and without prior notice,  in which case the Licensee shall
         have no further  right  whatsoever  to use the  Licensed  Marks and the
         Licensee's  shareholders,  officers and directors  shall  promptly take
         whatever  action may be necessary to eliminate all use of and reference
         to the Licensed Marks in the Licensor's name and otherwise.

6.       In the event of termination as provided for in paragraph 5 herein,  the
         Licensee  agrees  to  promptly  do all such  acts and  things as may be
         necessary to terminate  its use of the Licensed  Marks and will,  after
         such  termination,  make no further  reference to the Licensed Marks or
         any confusingly similar term in its business.

7.       The  Licensor  and the  Licensee  agree to do all such further acts and
         things to effect the purposes of this Agreement.

8.       The  representations  and  warranties  contained  herein shall continue
         after and survive the  termination of this  Agreement.  No provision of
         this  Agreement  may be amended or modified  in any manner  except by a
         written  agreement  properly  authorized  and  executed  by each  party
         hereto.  This agreement may not be assigned by the Licensee without the
         prior written consent of the Licensor, although the Licensor may assign
         this  Agreement at any time without  notice or penalty.  Subject to the
         Licensee's Articles of Incorporation,  with such amendments, if any, as
         may be in effect as of the date hereof,  this Agreement  supersedes any
         prior agreement between the parties.



<PAGE>



         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.


                             BULL & BEAR GROUP, INC.


                            By:/s/ Robert D. Anderson



                               ROCKWOOD FUND, INC.


                            By: /s/ Thomas B. Winmill


<PAGE>


                                   Schedule A



1.     Bull & Bear Performance Account

2.     Bull & Bear Performance Plus Account

3.     Performance

4.     Bull & Bear

5.     Performance Driven

6.     Bull & Bear Performance Driven

7.     Bull & Bear Stockfax

9.     Bull & Bear No-Fee IRA

10.    Performance Plus


<PAGE>



                         NON-EXCLUSIVE LICENSE AGREEMENT



         AGREEMENT dated as of March 4, 1998 between BULL & BEAR GROUP,  INC., a
Delaware  corporation  (the  "Licensor") and BULL & BEAR SPECIAL  EQUITIES FUND,
INC., a Maryland corporation (the "Licensee").

                               W I T N E S S E T H

         WHEREAS,  the Licensor is the owner of all right, title and interest in
and to the service  marks listed on Schedule A hereto,  as such  Schedule may be
amended  from  time  to  time,  (hereinafter  collectively  referred  to as  the
"Licensed Marks"), and

         WHEREAS, the Licensee has requested a non-exclusive license to use the
         Licensed Marks in connection with its corporate activities,

         NOW, THEREFORE, the parties hereto agree as follows:

1.       The Licensor grants to the Licensee the non-exclusive  right to use the
         Licensed  Marks in  connection  with its  activities  as an  investment
         company.

2.       The  grant  of the  license  provided  for in  paragraph  1  herein  is
         personal,  indivisible,  non-exclusive and not subject to succession or
         transfer.

3.       The  Licensee  agrees to follow  all rules  reasonably  imposed  by the
         Licensor to protect the Licensor's rights in the Licensed Marks.

4.       The  Licensee  agrees  that the  nature  and  quality  of all  services
         rendered by the Licensee in  connection  with the Licensed  Marks shall
         conform to standards  set by the  Licensor and be under  control of the
         Licensor.

5.       The license  provided for in this  Agreement  may be  terminated in the
         event the  Investment  Manager of the Licensee shall not be Bull & Bear
         Advisers, Inc. or some other corporation controlling, controlled by, or
         under the common control of the Licensor.

6.       In the event of termination as provided for in paragraph 5 herein,  the
         Licensee  agrees  to  promptly  do all such  acts and  things as may be
         necessary to terminate  its use of the Licensed  Marks and will,  after
         such  termination,  make no further  reference to the Licensed Marks or
         any confusingly similar term in its business.

7.       The  Licensor  and the  Licensee  agree to do all such further acts and
         things to effect the purposes of this Agreement.

8.       The  representations  and  warranties  contained  herein shall continue
         after and survive the  termination of this  Agreement.  No provision of
         this  Agreement  may be amended or modified  in any manner  except by a
         written  agreement  properly  authorized  and  executed  by each  party
         hereto.  This agreement may not be assigned by the Licensee without the
         prior written consent of the Licensor, although the Licensor may assign
         this  Agreement at any time without  notice or penalty.  Subject to the
         Licensee's Articles of Incorporation,  with such amendments, if any, as
         may be in effect as of the date hereof,  this Agreement  supersedes any
         prior agreement between the parties.



<PAGE>



         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.


                             BULL & BEAR GROUP, INC.


                            By:/s/ Robert D. Anderson



                     BULL & BEAR SPECIAL EQUITIES FUND, INC.


                            By:/s/ Thomas B. Winmill






<PAGE>


                                   Schedule A



1.     Bull & Bear Performance Account

2.     Bull & Bear Performance Plus Account

3.     Performance

4.     Bull & Bear

5.     Performance Driven

6.     Bull & Bear Performance Driven

7.     Bull & Bear Stockfax

9.     Bull & Bear No-Fee IRA

10.    Performance Plus

<PAGE>

                         NON-EXCLUSIVE LICENSE AGREEMENT



         AGREEMENT dated as of March 4, 1998 between BULL & BEAR GROUP,  INC., a
Delaware corporation (the "Licensor") and BULL & BEAR U.S. GOVERNMENT SECURITIES
FUND, INC., a Maryland corporation (the "Licensee").

                               W I T N E S S E T H

         WHEREAS,  the Licensor is the owner of all right, title and interest in
and to the service  marks listed on Schedule A hereto,  as such  Schedule may be
amended  from  time  to  time,  (hereinafter  collectively  referred  to as  the
"Licensed Marks"), and

         WHEREAS, the Licensee has requested a non-exclusive license to use the
         Licensed Marks in connection with its corporate activities,

         NOW, THEREFORE, the parties hereto agree as follows:

1.       The Licensor grants to the Licensee the non-exclusive  right to use the
         Licensed  Marks in  connection  with its  activities  as an  investment
         company.

2.       The  grant  of the  license  provided  for in  paragraph  1  herein  is
         personal,  indivisible,  non-exclusive and not subject to succession or
         transfer.

3.       The  Licensee  agrees to follow  all rules  reasonably  imposed  by the
         Licensor to protect the Licensor's rights in the Licensed Marks.

4.       The  Licensee  agrees  that the  nature  and  quality  of all  services
         rendered by the Licensee in  connection  with the Licensed  Marks shall
         conform to standards  set by the  Licensor and be under  control of the
         Licensor.

5.       The license may be withdrawn  by the Licensor at any time,  in its sole
         discretion  and without prior notice,  in which case the Licensee shall
         have no further  right  whatsoever  to use the  Licensed  Marks and the
         Licensee's  shareholders,  officers and directors  shall  promptly take
         whatever  action may be necessary to eliminate all use of and reference
         to the Licensed Marks in the Licensor's name and otherwise.

6.       In the event of termination as provided for in paragraph 5 herein,  the
         Licensee  agrees  to  promptly  do all such  acts and  things as may be
         necessary to terminate  its use of the Licensed  Marks and will,  after
         such  termination,  make no further  reference to the Licensed Marks or
         any confusingly similar term in its business.

7.       The  Licensor  and the  Licensee  agree to do all such further acts and
         things to effect the purposes of this Agreement.

8.       The  representations  and  warranties  contained  herein shall continue
         after and survive the  termination of this  Agreement.  No provision of
         this  Agreement  may be amended or modified  in any manner  except by a
         written  agreement  properly  authorized  and  executed  by each  party
         hereto.  This agreement may not be assigned by the Licensee without the
         prior written consent of the Licensor, although the Licensor may assign
         this  Agreement at any time without  notice or penalty.  Subject to the
         Licensee's Articles of Incorporation,  with such amendments, if any, as
         may be in effect as of the date hereof,  this Agreement  supersedes any
         prior agreement between the parties.





<PAGE>







         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.


                             BULL & BEAR GROUP, INC.


                            By:/s/ Robert D. Anderson



                BULL & BEAR U.S. GOVERNMENT SECURITIES FUND, INC.


                            By: /s/ Thomas B. Winmill






<PAGE>


                                   Schedule A



1.     Bull & Bear Performance Account

2.     Bull & Bear Performance Plus Account

3.     Performance

4.     Bull & Bear

5.     Performance Driven

6.     Bull & Bear Performance Driven

7.     Bull & Bear Stockfax

9.     Bull & Bear No-Fee IRA

10.    Performance Plus


<PAGE>


       EXHIBIT 11 - STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS

<TABLE>
<CAPTION>

                                               1997                      1996                        1995
                                      ----------------------     ----------------------    -------------------------
                                         BASIC      DILUTED       BASIC       DILUTED       BASIC         DILUTED
Weighted average common
<S>                                   <C>          <C>           <C>          <C>           <C>           <C>
   shares outstanding                 1,370,017    1,370,017     1,369,555    1,369,555     1,499,516     1,499,516

Weighted average common shares
issuable upon exercise of stock
options under the
treasury stock method                     -           98,235          -            -           -            50,299

Weighted average common
   shares issuable upon
   exercise of warrants under
   the treasury stock method              -              -            -             -          -               -

Weighted average common
   shares and common share
   equivalents utilized for
   earnings per share
   computation                        1,370,017    1,468,252      1,369,555   1,369,555     1,499,516     1,549,815

</TABLE>






                                       89


<PAGE>



              EXHIBIT 21 - WHOLLY-OWNED SUBSIDIARIES OF THE COMPANY


Bull & Bear Advisers, Inc.,
   a Delaware corporation


Bull & Bear Securities, Inc.,
   a Delaware corporation


Hanover Direct Advertising Company, Inc.,
   a Delaware corporation


Investor Service Center, Inc.,
   a Delaware corporation


Lion Exploration, Inc.,
   a Delaware corporation


Midas Management Corporation
   a Delaware corporation


Performance Properties, Inc.,
   a Delaware corporation


Rockwood Advisers, Inc.
   a Delaware Corporation