Rule 497(e)
Registration No. 333-00767
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AMERINDO FUNDS INC. PROSPECTUS
May 1, 1999
Class A Shares; Class D Shares
As Supplemented July 28, 1999
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AMERINDO TECHNOLOGY FUND
A mutual fund whose investment objective is to seek
long-term capital appreciation.
The Securities and Exchange Commission Has Not Approved or
Disapproved These Securities or Passed upon the Adequacy of this
Prospectus. Any Representation to the Contrary is a Criminal Offense.
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TABLE OF CONTENTS
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Risk/Return Summary.......................................2 How to Purchase Shares...................................11
Fee Table.................................................4 For Class A Shareholders Only
Reduction or Elimination of Sales Loads..................13
Investment Objectives, Principal
Investment Strategies and Related How to Redeem Shares.....................................14
Risks.....................................................5
Dividends and Distributions..............................15
Additional Investment Information and
Risk Factors..............................................6 Tax Consequences.........................................16
Management, Organization and Capital Structure............8 Distribution Arrangements................................17
Pricing of Fund Shares....................................10 Financial Highlights Information.........................19
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RISK/RETURN SUMMARY
The Fund is currently composed of one portfolio called the Amerindo Technology
Fund.
Investment Objective
The Fund's investment objective is to seek long-term capital appreciation.
Current income is incidental to the Fund's investment objective. There is no
assurance that the Fund will achieve its investment objective.
Principal Investment Strategies
The Fund seeks to achieve its investment objective by investing at least 65% of
its total assets (although the Fund intends, as a non-fundamental policy, to
invest at least 80% of its assets) in the common stocks of technology companies.
Technology companies are those companies with primary business operations in
either the technology or science areas. Industries likely to be represented in
the portfolio include computers, networking and internetworking software,
computer aided design, telecommunications, media and information services,
medical devices and biotechnology. In addition to investing at least 65% of its
assets in technology companies, the Fund may also invest in the stocks of
companies that should benefit from the commercialization of technological
advances, although they may not be directly involved in research and
development.
Principal Risks
o The loss of money is a risk of investing in the Fund.
o The value of the Fund's shares and the securities held by the Fund can
each decline in value.
o Investments in companies in the rapidly changing fields of technology and
science face special risks such as competitive pressures and
technological obsolescence and may be subject to greater governmental
regulation than many other industries.
o Investments in smaller capitalized companies may involve greater risks,
such as limited product lines, markets and financial or managerial
resources.
o As a non-diversified fund, compared to other mutual funds, this Fund may
invest a greater percentage of its assets in a particular issuer.
Therefor, investors should consider this greater risk versus the safety
that comes with a more diversified portfolio.
o During the Fund's current fiscal year, substantial capital gains were
realized on sales of securities. See "Additional Investment Information
and Risk Factors" for additional information.
Who May Want to Invest in This Fund
This Fund is designed for long-term investors who understand and are willing to
accept the risk of loss involved in investing in a fund seeking long-term
capital appreciation. Investors should consider their investment goals, their
time horizon for achieving them, and their tolerance for risks before investing
in the Fund. If you seek an aggressive approach to capital growth and can accept
the above average level of price fluctuations that this Fund is expected to
experience, this Fund could be an appropriate part of your overall investment
strategy. The Fund should not represent your complete investment program or be
used for short-term trading purposes.
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Risk/Return Bar Chart and Table
The following bar chart and table may assist in your decision to invest in the
Fund. The bar chart shows the average annual returns of the Fund for the life of
the Fund. The table shows how the Fund's average annual returns for a one-year
period compares with that of the Hambrecht & Quist Growth Index.* While
analyzing this information, please note that the Fund's past performance is not
an indication of how the Fund will perform in the future.
Year-by Year Total Return as of December 31(1)
(Class D Shares)
[graphic omitted]
100.00% ---------------------------------------------------------------
80.00% - 84.67%
60.00% -
40.00% -
20.00% -
0.00% ---------------------------------------------------------------
- -20.00% -
- -40.00% - -18.11%
---------------------------------------------------------------
1997 1998
Best Quarter 12/31/98: 49.07% Worst Quarter 3/31/97: (28.89%)
Average Annual Total Returns (for the
periods ending 12/31/98)(2)(3)(4) Past One Year Since Inception (5)
Amerindo Technology Fund - Class A Shares NA 54.61%**
Hambrecht & Quist Growth Index * 45.10% 36.26%+
Amerindo Technology Fund - Class D Shares 84.67% 15.24%
Hambrecht & Quist Growth Index * 45.10% 17.59%++
* The Hambrecht & Quist Growth Index is a multiple-sector growth stock
composite comprised of the publicly traded stocks of approximately 275
companies that have annual revenues of less than $300 million. The Index
includes companies in the technology, healthcare services, branded
consumer, and Internet sectors. You may not invest in The Hambrecht & Quist
Growth Index and unlike the Fund, it does not incur fees or charges.
** Not Annualized.
+ Since inception of Class A Shares.
++ Since inception of Class D Shares.
(1) The sales load is not reflected in the Bar Chart. If this amount was
reflected, returns would be less than those shown.
(2) Both Classes have substantially the same returns because the shares are
invested in the same portfolio of securities. The annual returns differ
only to the extent that the classes do not have the same expenses.
(3) Shareholder Organizations may charge a fee to investors for purchasing or
redeeming shares. The net return to such investors may be less than if they
had invested in the Fund directly.
(4) Sales loads are reflected in the Table.
(5) The date of inception of the Class A shares was August 3, 1998. The date of
inception of the Class D shares was October 29, 1996.
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FEE TABLE
This table describes the fees and expenses that you may pay if you buy and hold
shares of the Fund.
Class A Class D
------- -------
Shareholder Fees
(fees paid directly from your investment)
Maximum Sales Load Imposed on Purchases
(as a percentage of the offering price) 5.75% None
Redemption Fees for shares held less than 1 year
(as a percent of amount redeemed, if applicable) 3.00% 3.00%
Annual Fund Operating Expenses
(expenses that are deducted from Fund assets)
Management Fees 1.50% 1.50%
Distribution and/or Service 12b-1 Fees 0.50% 0.25%
Other Expenses 1.00% 1.00%
Total Annual Operating Expenses 3.00% 2.75%
The Adviser reimbursed the Fund 0.50% of the Adviser's fee. After this
reimbursement, the "Other Expenses" and "Total Annual Operating Expenses" were
0.50% and 2.50%, respectively, for the Class A shares and 0.50% and 2.25%,
respectively, for the Class D shares. The "Total Annual Operating Expenses,"
including "Other Expenses" for the Class A shares, are based on the actual
expenses for the Class D shares for the fiscal year ended December 31, 1998. The
Adviser may terminate the reimbursement arrangement at any time.
Example: This example is intended to help you compare the cost of investing in
the Fund with the cost of investing in other mutual funds. The Example assumes
that you invest $10,000 in the Fund over the time periods indicated and then
redeem all of your shares at the end of those periods. The Example also assumes
that your investment has a 5% return each year and that the Fund's operating
expenses remain the same. Although your actual costs may be higher or lower,
based on these assumptions your costs would be:
Year 1 Year 3 Year 5 Year 10
Class A $814 $1309 $1829 $3248
Class D $228 $ 703 $1205 $2585
You would pay the following expenses if you did not redeem your shares:
Year 1 Year 3 Year 5 Year 10
Class A $814 $1309 $1829 $3248
Class D $228 $ 703 $1205 $2585
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INVESTMENT OBJECTIVES, PRINCIPAL INVESTMENT
STRATEGIES AND RELATED RISKS
Investment Objective. The Fund's investment objective is to seek long-term
capital appreciation. There can be no assurance that the Fund's investment
objective will be achieved. The investment objective is fundamental to the Fund
and may not be changed without shareholder approval. Current income is
incidental to the Fund's investment objective.
Principal Investment Strategies. The Fund seeks to achieve its investment
objectives by investing at least 65% of its assets (although the Fund intends,
as a non-fundamental policy, to invest at least 80% of its assets) in the common
stocks of technology companies. Technology companies are those companies with
primary business operations in either the technology or science areas.
Industries likely to be represented in the portfolio include computers,
networking and internetworking software, computer aided design,
telecommunications, media and information services, medical devices and
biotechnology. In addition to investing at least 65% of its assets in technology
companies, the Fund may also invest in the stocks of companies that should
benefit from the commercialization of technological advances, although they may
not be directly involved in research and development.
The Adviser believes that because of rapid advances in technology and science,
an investment in companies with business operations in these areas will offer
substantial opportunities for long-term capital appreciation. Of course, prices
of common stocks of even the best managed, most profitable corporations are
subject to market risk, which means their stock prices can decline. In addition,
swings in investor psychology or significant trading by large institutional
investors can result in price fluctuations.
The technology and science areas have exhibited and continue to demonstrate
rapid growth, both through increasing demand for existing products and services
and the broadening of the technology market. In general, the stocks of large
capitalized companies that are well established in the technology market can be
expected to grow with the market and will frequently be found in the Fund's
portfolio. The expansion of technology and science areas, however, also provides
a favorable environment for investment in small to medium capitalized companies.
The Fund's investment policy is not limited to any minimum capitalization
requirement and the Fund may hold securities without regard to the
capitalization of the issuer. The Adviser's overall stock selection for the Fund
is not based on the capitalization or size of the company but rather on an
assessment of the company's fundamental prospects. The Fund will not purchase
stocks of companies during their initial public offering or during an additional
public offering of the same security. The Adviser anticipates, however, that a
significant portion of the Fund's holdings will be invested in newly-issued
securities being sold in the secondary market.
Although the Fund will primarily invest in common stocks issued by U.S.
companies, the Fund also may invest in other types of securities such as
convertible stocks, preferred stocks, bonds and warrants, when the investment in
such securities is considered consistent with the Fund's investment objective by
the Adviser.
The Fund will not invest more than 20% of its total assets in convertible
stocks, preferred stocks, bonds and warrants. The bonds in which the Fund may
invest are not required to be rated by a recognized rating agency. As a matter
of policy, however, the Fund will invest only in "investment grade" debt
securities (i.e., rated within the four highest ratings categories by a
nationally recognized statistical rating organization, e.g., BBB or higher by
Standard & Poor's Ratings Services, a division of the McGraw-Hill Companies,
Inc. ("S&P"), Baa or higher by Moody's Investor Service, Inc. ("Moody's"), BBB
or higher by Fitch Investors Services, Inc. ("Fitch"), or BBB or higher by Duff
& Phelps Credit Rating Co.--such securities may have speculative
characteristics) or, in the case of unrated securities, debt securities that
are, in the opinion of the Adviser, of equivalent quality to "investment grade"
securities. In addition, the Fund will not necessarily dispose of any securities
that fall below investment grade based upon the Adviser's determination as to
whether retention of such a security is consistent with the Fund's investment
objective, provided, however, that such securities do not exceed 5% of the
Fund's total assets.
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Portfolio Turnover. Purchases and sales are made for the Fund whenever
necessary, in the Adviser's opinion, to meet the Fund's investment objective,
other investment policies, and the need to meet redemptions. The turnover rate
of the Fund for the fiscal year ended December 31, 1998 was 78.46%. Fund
turnover may involve the payment by the Fund of dealer spreads or underwriting
commissions, and other transaction costs, on the sale of securities, as well as
on the investment of the proceeds in other securities. The greater the portfolio
turnover the greater the transaction costs to the Fund which could have an
adverse effect on the Fund's total rate of return. The Fund will minimize
portfolio turnover because it will not seek to realize profits by anticipating
short-term market movements and intends to buy securities for long-term capital
appreciation under ordinary circumstances.
Buy/Sell Decisions. The Fund's investment adviser considers the following
factors when buying and selling securities for the Fund: (i) the value of
individual securities relative to other investment alternatives, (ii) trends in
the determinants of corporate profits, (iii) corporate cash flow, (iv) balance
sheet changes, (v) management capability and practices and (vi) the economic and
political outlook.
ADDITIONAL INVESTMENT INFORMATION AND RISK FACTORS
The Technology and Science Areas. Companies in the rapidly changing fields of
technology and science face special risks. For example, their products or
services may not prove commercially successful or may become obsolete quickly.
The value of the Fund's shares may be susceptible to factors affecting the
technology and science areas and to greater risk and market fluctuation than an
investment in a fund that invests in a broader range of portfolio securities not
concentrated in any particular industry. As such, the Fund is not an appropriate
investment for individuals who are not long-term investors and who, as their
primary objective, require safety of principal or stable income from their
investments. The technology and science areas may be subject to greater
governmental regulation than many other areas and changes in governmental
policies and the need for regulatory approvals may have a material adverse
effect on these areas. Additionally, companies in these areas may be subject to
risks of developing technologies, competitive pressures and other factors and
are dependent upon consumer and business acceptance as new technologies evolve.
Concentration. The volatile nature of the technology and science areas could
cause price appreciation in a particular security or securities that results in
that investment increasing its concentration in the portfolio, in some cases,
well above the level at which it was originally purchased. For instance, even
though an investment may have been purchased at a time when it represented less
than 25% of the portfolio, appreciation may cause that concentration to be
significantly greater than 25% at various times in a rising market.
The Adviser reviews the positions of the Fund on a regular basis to ensure that
all tax and regulatory requirements are maintained. In instances where the value
of an investment has risen above 25%, the Adviser will evaluate the
appropriateness of that level of investment in light of the overall investment
strategy of the Fund and applicable regulatory and tax implications.
Smaller Capitalized Companies. The Adviser believes that smaller capitalized
companies generally have greater earnings and sales growth potential than larger
capitalized companies. The level of risk will be increased to the extent that
the Fund has significant exposure to smaller capitalized or unseasoned companies
(those with less than a three-year operating history). Investments in smaller
capitalized companies may involve greater risks, such as limited product lines,
markets and financial or managerial resources. In addition, less
frequently-traded securities may be subject to more abrupt price movements than
securities of larger capitalized companies.
Capital Gains. During the Fund's current fiscal year, substantial capital gains
were realized on sales of securities. These capital gains are material ($6.13 of
long-term capital gain and $8.92 of short-term capital gain per share based upon
the outstanding shares of the Fund as of April 30, 1999). In accordance with
applicable tax law requirements and the Fund's procedures, it anticipates
distributing its net long-
699557.6
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term capital gains and net investment income, including any net short-term
capital gains, prior to the end of its fiscal year ending October 31, 1999. Any
Investor who acquires shares before the Fund pays this dividend will be required
to include that dividend in his/her income even though the dividend represents,
in effect, a return of capital. A distribution of long-term capital gain
(increased or decreased by all other realized long-term capital gain and long or
short-term capital losses incurred during the course of the fiscal year) will be
taxed to investors as long-term capital gain for federal income tax purposes. A
distribution of short-term capital gain (increased or decreased by all other
realized short-term capital gains or ordinary income and long or short-term
capital or ordinary losses incurred during the course of the fiscal year) will
be taxed to investors as ordinary income for federal income tax purposes.
Although there is no certainty that the Fund will pay a dividend or at what
level the dividend will be paid, potential investors should be aware that these
capital gains (if not reduced by other transactions during the course of the
fiscal year) may have material tax consequences to them and should consult their
tax advisers before investing in the Fund.
Borrowing. The Fund may from time to time borrow money from banks for temporary,
extraordinary or emergency purposes. Such borrowing will not exceed an amount
equal to one-third of the value of the Fund's total assets less its liabilities
and will be made at prevailing interest rates. The Fund may not, however,
purchase additional securities while borrowings exceed 5% of its total assets.
Illiquid Securities. The Fund may invest up to 15% of its net assets in illiquid
securities, including restricted securities (i.e., securities subject to certain
restrictions on their transfer) and other securities that are not readily
marketable, such as repurchase agreements maturing in more than one week,
provided, however, that any illiquid securities purchased by the Fund will have
been registered under the Securities Act of 1933 or be securities of a class, or
convertible into a class, which is already publicly traded and the issuer of
which is filing reports required by Section 13 or 15 of the Securities Exchange
Act of 1934.
Temporary Investments. When the Adviser believes that adverse business or
financial conditions warrant a temporary defensive position, the Fund may invest
up to 100% of its assets in short-term instruments such as commercial paper,
bank certificates of deposit, bankers' acceptances, variable rate demand
instruments or repurchase agreements for such securities and securities of the
U.S. Government and its agencies and instrumentalities, as well as cash and cash
equivalents denominated in foreign currencies. Investments in domestic bank
certificates of deposit and bankers' acceptances will be limited to banks that
have total assets in excess of $500 million and are subject to regulatory
supervision by the U.S. Government or state governments. While taking a
defensive position, the Fund may not achieve its investment objective.
Repurchase Agreements. The Fund's portfolio position in cash or cash equivalents
may include entering into repurchase agreements. A repurchase agreement is an
instrument under which an investor purchases a U.S. Government security from a
vendor, with an agreement by the vendor to repurchase the security at the same
price, plus interest at a specified rate. Repurchase agreements may be entered
into with member banks of the Federal Reserve System or "primary dealers" (as
designated by the Federal Reserve Bank of New York) in U.S. Government
securities. Repurchase agreements usually have a short duration, often less than
one week. The Fund requires continual maintenance by the Fund's custodian of the
market value of underlying collateral in amounts equal to, or in excess of, the
value of the repurchase agreement including the agreed upon interest. If the
institution defaults on the repurchase agreement, the Fund will retain
possession of the underlying securities. In addition, if bankruptcy proceedings
are commenced with respect to the seller, realization on the collateral by the
Fund may be delayed or limited and the Fund may incur additional costs. In such
case the Fund will be subject to risks associated with changes in the market
value of the collateral securities. The Fund intends to limit repurchase
agreements to transactions with institutions believed by the Adviser to present
minimal credit risk. Repurchase agreements may be considered to be loans under
the Investment Company Act of 1940, as amended.
Year 2000 Compliance. As the Year 2000 approaches, an issue has emerged
regarding how existing application software programs and operating systems can
accommodate this date value. Failure to adequately address this issue could have
potentially serious repercussions. The Adviser is in the process of
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working with the Fund's service providers to prepare for the Year 2000. Based on
information currently available, the Adviser does not expect that the Fund will
incur significant operating expenses or be required to incur materials costs to
be Year 2000 compliant. Although the Adviser does not anticipate that the Year
2000 issue will have a material impact on the Fund's ability to provide service
at current levels, there can be no assurance that steps taken in preparation for
the Year 2000 will be sufficient to avoid any adverse impact on the Fund. The
Year 2000 problem may also adversely affect issuers of the Securities contained
in the Fund to varying degrees based upon various factors, and these may have a
corresponding adverse effect on the Fund's performance. The Manager is unable to
predict what effect, if any, the Year 2000 problem will have on such issues.
Non-Diversified Status. A "non-diversified" fund has the ability to take larger
positions in a smaller number of issuers. Because the appreciation or
depreciation of a single stock may have a greater impact on the net asset value
of a non-diversified fund, its share price can be expected to fluctuate more
than a comparable diversified fund. This fluctuation, if significant, may affect
the performance of the Fund.
MANAGEMENT, ORGANIZATION AND CAPITAL STRUCTURE
Adviser. Amerindo Investment Advisors Inc. (the "Adviser" or "Amerindo"), a
registered investment adviser, is a California corporation with its principal
office located at One Embarcadero, Suite 2300, San Francisco, California 94111.
The Adviser, an emerging growth stock manager specializing in the technology and
healthcare sectors, had assets under management of approximately $2.5 billion as
of December 31, 1998. Alberto W. Vilar and Dr. Gary A. Tanaka are primarily
responsible for the day-to-day management of the Fund's portfolio. Their
biographies are as follows:
Alberto W. Vilar, 58, has been Chairman of the Board of Directors and Chief
Executive Officer of the Fund since its inception. He began his career with
Citibank N.A. in New York in 1964 and worked there as an International Credit
Officer until 1967. From 1967 to 1971, he served as Vice President, Portfolio
Manager and Manager of the Investment Management Division of Drexel Burnham
Lambert in New York. From 1971 to 1973, he served as Executive Vice President,
Portfolio Manager and Director of Equity Strategy at M.D. Sass Investor Services
in New York. In 1973, he became Vice President and Portfolio Manager of
Endowment Management & Research Corporation in Boston. From 1977 to 1979, he
served as Senior Vice President, Director of Research, Chief Investment
Strategist and Partnership Manager of the Boston Company in Boston. He founded
the predecessors of Amerindo Advisors (U.K.) Limited and Amerindo Investment
Advisors, Inc. (Panama) in 1979 and has served since then as a Principal
Portfolio Manager. He holds the degrees of B.A. in Economics from Washington &
Jefferson College and an M.B.A. from Iona College, and he completed the Doctoral
Studies Program in Economics at New York University. Mr. Vilar was awarded an
Honorary Doctorate of Humanities degree from Washington & Jefferson College.He
has been a Chartered Financial Analyst since 1975.
Dr. Gary A. Tanaka, 55, has been a Director and President of the Fund since its
inception. He served as a Portfolio Manager for Crocker Bank in San Francisco
from 1971 to 1977, and as a Partnership Manager for Crocker Investment
Management Corp. in San Francisco from 1978 to 1980. From 1975 to 1980, he also
served as a Consultant to Andron Cechettini & Associates in San Francisco. In
1980, he joined the predecessors of Amerindo Advisors (U.K.) Limited and
Amerindo Investment Advisors, Inc. (Panama) as a Principal Portfolio Manager and
has served in this position since that time. Dr. Tanaka holds the degrees of
B.S. in Mathematics from Massachusetts Institute of Technology and Ph.D. in
Applied Mathematics from Imperial College, University of London.
Pursuant to the Investment Advisory Contract for the Fund, the Adviser manages
the Fund's portfolio of securities and makes the decisions with respect to the
purchase and sale of investments subject to the general control of the Board of
Directors of the Fund.
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Adviser's Fees. Pursuant to the terms of the Investment Advisory Agreement, the
Fund will pay an annual advisory fee paid monthly equal to 1.50% of the Fund's
average daily net assets. This fee is higher than the fee paid by most other
mutual funds, however, the Board of Directors believes it to be reasonable in
light of the advisory services the Fund receives. The Adviser will also receive
the service fees of 0.25% of each Class's average daily net assets. Any portion
of the advisory fees received by the Adviser may be used by the Adviser to
provide investor and administrative services and for distribution of Fund
shares. The Adviser may voluntarily waive a portion of its fee or assume certain
expenses of the Fund. This would have the effect of lowering the overall expense
ratio of the Fund and of increasing yield to investors in the Fund. See
"Voluntary Expense Subsidization" in Section V.A.2 of the Statement of
Additional Information.
Performance of the Adviser. In the early 1980's, Amerindo pioneered the
management of dedicated emerging technology portfolios of high technology and
healthcare stocks designed to service the financial needs of the institutional
investor. As reported in the Wall Street Journal's Money Manager Scorecard on
July 24, 1996, May 1, 1996 and January 18, 1996, Amerindo ranked first for its
one-year and five-year performance, respectively. Amerindo did not have a
ten-year performance number. Amerindo was not ranked by the Money Manager
Scorecard during 1997. Each Money Manager Scorecard represents a ranking at June
30, 1996, March 31, 1996 and December 31, 1995, respectively, of the estimated
stock-market performance of U.S. money managers with over $100 million under
management. The 1, 5 and 10-year performance rankings were compiled by Thompson
Investment Software, CDA Investment Technologies, utilizing data provided by
CDA/Spectrum, with respect to data on 754,409, and 217 managers, respectively.
This performance information relates to Amerindo's management of institutional
accounts and should not be interpreted as indicative of future performance of
the Fund. The performance figures upon which these rankings were based do not
include a reduction for any charges or expenses with respect to such accounts.
Further, Amerindo has not independently verified the accuracy, completeness or
process underlying the performance figures upon which these rankings were based
and makes no representation as to the accuracy or completeness of this
performance information.
The performance of the Fund may be compared in various financial and news
publications to the performance of various indices and investments for which
reliable performance data is available. The performance of the Fund may be
compared in publications to averages, performance rankings, or other information
prepared by nationally recognized mutual fund ranking and statistical services.
As with other performance data, performance comparisons should not be considered
representative of the Fund's relative performance for any future period.
Amerindo's equity composite includes the portfolios managed in substantially
similar styles to that of the Fund of all clients which are institutions, such
as qualified retirement plans, charitable foundations and educational endowment
funds, for which investment income and realized capital gains are exempt from
Federal income tax, and for which Amerindo has full discretionary authority to
manage in accordance with the firm's equity strategy for separate accounts.
Amerindo has elected to comply with the American Association for Investment
Management and Research presentation standards for the period October 1, 1987
(inception of the composite) through December 31, 1998. An independent
accounting firm has conducted an examination with respect to Amerindo for the
period October 1, 1987 through December 31, 1997, and has confirmed that
Amerindo's performance presentation contained herein for such period conforms
with AIMR standards. The 1998 review is currently in progress. The Independent
Accountants' Report is available upon request. AIMR has not been involved with
the preparation or review of the Independent Accountants' Report. The AIMR
method of performance differs from that of the SEC and can contain different
results. The private accounts listed do not have to comply with the Investment
Company Act of 1940 or Subchapter M of the Internal Revenue Code. If this
compliance was necessary, the account's performance could be adversely affected.
The following Schedule represents the rates of return for the equity composite
for the annual investment periods from January 1, 1989 through December 31,
1998. Accounts benchmarks are the Standard &
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Poor's 500 Composite Stock Index, Hambrecht & Quist Growth Index and the Russell
2000 Growth Index. The Independent Accountants' Report relates to their
examination of Amerindo's performance from the inception of the composite
October 1, 1987 through December 31, 1997, which is in accordance with AIMR
standards.
The following performance information relates to Amerindo's management of
institutional accounts. This data should not be interpreted as the Fund's
performance nor is it indicative of future performance of the Fund.
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Asset Weighted Asset Weighted Russell
Composite Rate Composite Rate H&O 2000
of Return Net of of Return Gross of S&P Growth Growth
Year Advisory Fees Advisory Fees 500 Index Index Index
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1989 40.67% 42.49% 31.44% 17.41% 20.16%
1990 6.75% 8.49% -3.19% 3.89% -17.41%
1991 76.52% 78.39% 30.55% 94.49% 51.18%
1992 7.61% 8.73% 7.68% -3.57% 7.77%
1993 15.08% 16.42% 10.00% 7.81% 13.36%
1994 -2.66% -1.53% 1.33% 3.38% -2.43%
1995 87.51% 89.39% 37.50% 61.72% 31.04%
1996 8.04% 9.61% 23.22% 10.86% 11.26%
1997 -26.61% -26.05% 33.34% 2.39% 12.95%
1998 61.67% 64.14% 28.58% 45.04% 1.23%
Annualized rates of return for the period January 1, 1989 to December 31, 1998
22.71% 24.33% 20.38% 20.16% 11.82%
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Composite returns are shown both gross and net of investment
management fees. The composite is derived from all fully
discretionary, tax-free sheltered equity accounts in this style with
assets above $5,000,000. Past performance is no guarantee of future
results.
The Fund's total return for the period October 29, 1996 (commencement of
operations) through December 31, 1998 was 15.24%. The Fund's total return for
the calendar year ended December 31, 1998 was 84.67%.
PRICING OF FUND SHARES
Net asset value per share for each Class is determined by subtracting from the
value of such Class's total assets the amount of its liabilities and dividing
the remainder by the number of its outstanding shares. The value of each
security for which readily available market quotations exist is based on a
decision as to the broadest and most representative market for the security. The
value is based either on the last sale price on a national securities exchange,
or, in the absence of recorded sales, at the readily available closing bid price
on such exchanges, or at the quoted bid price in the over-the-counter market.
Assets for which market quotations are not readily available are valued in
accordance with procedures established by the Fund's Board of Directors,
including use of an independent pricing service or services which use prices
based on yields or prices of comparable securities, indications as to values
from dealers and general market conditions.
The Fund computes each Class's net asset value once daily on Monday through
Friday, at 4:15 p.m. New York time, except on New Year's Day, President's Day,
Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and
Christmas.
699557.6
10
<PAGE>
HOW TO PURCHASE SHARES
Initial Investments by Wire. You may purchase shares of each Class of the Fund
by wiring immediately available federal funds (subject to each Class's minimum
investment) to The Chase Manhattan Bank from your bank. Your bank may charge a
fee for doing so (see instructions below). The minimum initial investment in
Class A and Class D shares is $2,500 ($1,000 for IRA accounts), each of which
may be waived by the Fund.
If money is to be wired, you must call the Transfer Agent at 1-888-TECH FUND to
set up your account and obtain an account number. You should be prepared at that
time to provide the information on the application. Then you should provide your
bank with the following information for purposes of wiring your investment:
The Chase Manhattan Bank
Huntington, New York
ABA# 021000021
Account # 5021120976
F/B/O Amerindo Technology Fund
Ref. (Class)
Fund Acct. No.
------------------
You are required to mail a signed application to the Transfer Agent at the above
address in order to complete your initial wire purchase. Wire orders will be
accepted only on a day on which the Fund and the Custodian and Transfer Agent
are open for business. A wire purchase will not be considered made until the
wired money is received and the purchase accepted by the Fund. Shareholders will
receive the next determined net asset value per share after receipt of such wire
and the acceptance of the purchase by the Fund. Any delays which may occur in
wiring money, including delays which may occur in processing by the banks, are
not the responsibility of the Fund or the Transfer Agent. There is presently no
fee for the receipt of wired funds, but the right to charge shareholders for
this service is reserved by the Fund.
Initial Investments by Mail. An account may be opened by completing and signing
an Account Application and mailing it to the Fund at the address noted below,
together with a check (subject to each Class's minimum investment) payable to:
Amerindo Technology Fund
c/o American Data Services, Inc.
P.O. Box 5536
Hauppauge, N.Y. 11788-0132
Payment for the purchase of shares received by mail will be credited to a
shareholder's account at the net asset value per share of the particular Class
next determined after receipt. Such payment need not be converted into federal
funds (monies credited to the Fund's custodian bank by a Federal Reserve Bank)
before acceptance by the Fund's Distributor. In the event that there are
insufficient funds to cover a check, such prospective investor or investor will
be assessed a $15.00 charge.
Additional Investments. Additional investments may be made at any time (subject
to the minimum subsequent investment in Class A and Class D shares of $500) by
purchasing shares of the particular Class at net asset value, plus any
applicable sales load, by mailing a check to the Fund at the address noted under
"Initial Investments by Mail" (payable to Amerindo Technology Fund Class A/Class
D) or by wiring monies to the clearing bank as outlined above.
699557.6
11
<PAGE>
Other Purchase Information. Investors may open accounts in the Fund only through
the exclusive Distributor for the Fund. SEI Investments Distribution Co., for
nominal consideration and as agent for the Fund, will solicit orders for the
purchase of Fund shares, provided that any subscriptions and orders will not be
binding on the Fund until accepted by the Fund as principal.
The Fund reserves the right to redeem, after 60 days' written notice, shares in
accounts that fall below the minimum balance by reason of redemption and return
the proceeds to investors. The investors may restore and maintain a minimum
balance during the notice period.
Shareholders that purchased Class D shares during the period that the Fund was
not offering Class A shares for sale will remain Class D shareholders after the
date that Class A shares are offered for sale. Investors who purchased Class D
shares during such period are not required to meet the $25,000 minimum balance
requirement but will be required to maintain a minimum balance of $2,500.
The purchase price paid for shares of each Class is the current public offering
price, that is, the next determined net asset value of the shares after the
order is placed plus any applicable sales charge, with respect to Class A
shares. See "Net Asset Value" herein. The sales load, with respect to Class A
shares, is a one-time charge paid at the time of purchase of shares, most of
which ordinarily goes to the investor's broker-dealer as compensation for the
services provided the investor. Class A shares of the Fund are sold on a
continuous basis with a maximum front-end sales charge of 5.75% of the net asset
value per share. Class D shares are sold without a front-end sales load. Volume
discounts are provided for both initial purchase, as well as for additional
purchases of Class A shares of the Fund. See "Reduction or Elimination of Sales
Loads" herein. The Fund reserves the right to reject any subscription for
shares.
The Fund must receive an order and payment by the close of business for the
purchase to be effective and dividends to be earned on the same day. If funds
are received after the close of business, the purchase will become effective and
dividends will be earned on the next business day. Shares of the Fund may be
purchased in exchange for securities which are permissible investments of the
Fund, subject to the Adviser's determination that the securities are acceptable.
Securities accepted in exchange will be valued at the mean between their bid and
asked quotations. In addition, securities accepted in exchange must be liquid
securities that are not restricted as to transfer and will have a value that is
readily ascertainable (and not established only by evaluation procedures) as
evidenced by a listing on NASDAQ, the American Stock Exchange or the New York
Stock Exchange, or on the basis of prices provided by a pricing service. The
Fund and the Adviser reserve the right to reject any such purchase order.
Shareholders will bear any costs associated with a purchase of Fund shares
through such an exchange.
All purchases of the Fund's shares will be made in full and fractional shares of
the Fund calculated to three decimal places. The Fund does not intend to issue
certificates evidencing Fund shares.
Shares of the Fund may also be sold to corporations or other institutions such
as trusts, foundations or broker-dealers purchasing for the accounts of others
("Shareholder Organizations"). Investors purchasing and redeeming shares of the
Fund through a Shareholder Organization may be charged a transaction-based fee
or other fee for the services of such organization. Each Shareholder
Organization is responsible for transmitting to its customers a schedule of any
such fees and information regarding any additional or different conditions
regarding purchases and redemptions. Customers of Shareholder Organizations
should read this Prospectus in light of the terms governing accounts with their
organization. The Fund does not pay to or receive compensation from Shareholder
Organizations for the sale of the Fund's shares.
Purchases of Class D shares at net asset value may be made by investment
advisors or financial planners who place trades for their own accounts or the
accounts of their clients and who charge a management, consulting or other fee
for their services and by clients of such investment advisors or financial
planners who place trades for their own accounts if the accounts are linked to
the master account of such investment advisor or financial planner on the books
and records of the investment advisor or financial planner.
699557.6
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<PAGE>
The Fund has available a form of Individual Retirement Account ("IRA") which may
be obtained from the Fund that permits the IRA to invest in either Class A or
Class D shares of the Fund. The minimum initial investment for all retirement
plans investing in either Class of the Fund is $1,000 with a subsequent minimum
investment of $500. Investors desiring information regarding investments through
IRAs should write or telephone the Fund.
FOR CLASS A SHAREHOLDERS ONLY
REDUCTION OR ELIMINATION OF SALES LOADS
Volume Discounts. Volume discounts are provided if the total amount being
invested in Class A shares of the Fund reaches the levels indicated in the sales
load schedule provided below. The applicable volume discount available to
investors is determined by aggregating all Class A share purchases of the Fund.
Volume discounts are also available to investors making sufficient additional
purchases of Class A shares. The applicable sales charge may be determined by
adding to the total current value of Class A shares already owned in the Fund
the value of new purchases computed at the offering price on the day the
additional purchase is made. For example, if an investor previously purchased,
and still holds, Class A shares worth $40,000 at the current offering price and
purchases an additional $10,000 worth of Class A shares, the sales charge
applicable to the new purchase would be that applicable to the $50,000 to
$99,999 bracket in the sales load schedule provided below.
<TABLE>
<CAPTION>
Amount of sales charge
reallowed to dealers as
Sales Charge as a % of a percent
Amount of Purchase Sales Charge Net Amount Invested of offering price
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Less than $50,000 5.75% 6.10% 5.50%
$50,000 but less than $100,000 4.30% 4.71% 4.25%
$100,000 but less than $250,000 3.50% 3.63% 3.25%
$250,000 but less than $500,000 2.50% 2.56% 2.25%
$500,000 but less than $1,000,000 2.00% 2.04% 1.75%
$1,000,000 or more None None None
</TABLE>
Letter of Intent. Any investor in Class A shares may sign a Letter of Intent,
available from the Fund, stating an intention to make purchases of Class A
shares totaling a specified amount on an aggregate basis within a period of
thirteen months. Purchases within the thirteen-month period can be made at the
reduced sales load applicable to the total amount of the intended purchase noted
in the Letter of Intent. If a larger purchase is actually made during the
period, then a downward adjustment will be made to the sales charge based on the
actual purchase size. Any shares purchased within 90 days preceding the actual
signing of the Letter of Intent are eligible for the reduced sales charge and
the appropriate price adjustment will be made on those share purchases. A number
of shares equal to 5% of the dollar amount of intended purchases specified in
the Letter of Intent is held in escrow by the Distributor until the purchases
are completed. Dividends and distributions on the escrowed Class A shares are
paid to the investor. If the intended purchases are not completed during the
Letter of Intent period, the investor is required to pay the Fund an amount
equal to the difference between the regular sales load applicable to a single
purchase of the number of Class A shares actually purchased and the sales load
actually paid. If such payment is not made within 20 days after written request
by the Fund, then the Fund has the right to redeem a sufficient number of
escrowed Class A shares to effect payment of the amount due. Any remaining
escrowed Class A shares are released to the investor's account. Agreeing to a
Letter of Intent does not obligate you to buy, or the Fund to sell, the
indicated amount of Class A shares. You should read the Letter of Intent
carefully before signing.
699557.6
13
<PAGE>
Purchases At Net Asset Value. There is no initial sales charge for "Qualified
Persons." Qualified Persons is defined to include persons who are active or
retired Trustees, Directors, officers, partners, employees, clients, independent
professional contractors, shareholders or registered representatives (including
their spouses and children) of the Investment Adviser, Distributor or any
affiliates or subsidiaries thereof (the Directors, officers or employees of
which shall also include their parents and siblings for all purchases of Fund
shares) or any Director, officer, partner, employee or registered representative
(including their spouses and children) of any Broker-Dealer who has executed a
valid and currently active selling agreement with the Distributor.
HOW TO REDEEM SHARES
Shares of the Fund may be redeemed by mail, or, if authorized, by telephone. The
value of shares redeemed may be more or less than the purchase price, depending
on the market value of the investment securities held by the Fund.
By Mail. The Fund will redeem its shares at the net asset value next determined
after the request is received in "good order." The net asset value per share of
the Fund is determined as of 4:15 p.m., New York time, on each day that the New
York Stock Exchange, Inc. (the "NYSE"), the Fund and the Distributor are open
for business. Requests should be addressed to Amerindo Technology Fund, c/o
American Data Services, Inc., P.O. Box 5536, Hauppauge, N.Y. 11788-0132.
Requests in "good order" must include the following documentation:
(a) a letter of instruction, if required, or a stock assignment specifying
the number of shares or dollar amount to be redeemed, signed by all
registered owners of the shares in the exact names in which they are
registered;
(b) any required signature guarantees (see "Signature Guarantees" below);
and
(c) other supporting legal documents, if required, in the case of estates,
trusts, guardianships, custodianships, corporations, pension and
profit sharing plans and other organizations.
Signature Guarantees. To protect shareholder accounts, the Fund and its transfer
agent from fraud, signature guarantees are required to enable the Fund to verify
the identity of the person who has authorized a redemption from an account.
Signature guarantees are required for (1) redemptions where the proceeds are to
be sent to someone other than the registered shareholder(s) and the registeed
address and (2) share transfer requests. Signature guarantees may be obtained
from certain eligible financial institutions, including but not limited to, the
following: banks, trust companies, credit unions, securities brokers and
dealers, savings and loan associations and participants in the Securities
Transfer Association Medallion Program ("STAMP"), the Stock Exchange Medallion
Program ("SEMP") or the New York Stock Exchange Medallion Signature Program
("MSP"). Shareholders may contact the Fund at 1-888-TECH FUND for further
details.
By Telephone. Provided the Telephone Redemption Option has been authorized, a
redemption of shares may be requested by calling the Fund at 1-888-TECH FUND and
requesting that the redemption proceeds be mailed to the primary registration
address or wired per the authorized instructions. If the Telephone Redemption
Option is authorized, the Fund and its transfer agent may act on telephone
instructions from any person representing himself or herself to be a shareholder
and believed by the Fund or its transfer agent to be genuine. The transfer
agent's records of such instructions are binding and shareholders, and not the
Fund or its transfer agent, bear the risk of loss in the event of unauthorized
instructions reasonably believed by the Fund or its transfer agent to be
genuine. The Fund will employ reasonable procedures to confirm that instructions
communicated are genuine and, if it does not, it may be liable for any losses
due to unauthorized or fraudulent instructions. The procedures employed by the
Fund in connection with
699557.6
14
<PAGE>
transactions initiated by telephone may include tape recording of telephone
instructions and requiring some form of personal identification prior to acting
upon instructions received by telephone.
Optional Redemption by the Fund. Investors are required to maintain a minimum
account balance of at least $2,500 for Class A and Class D shares. The Fund
reserves the right to redeem, after 60 days' written notice, shares in accounts
that fall below the minimum balance by reason of redemption and return the
proceeds to investors. The investors may restore and maintain a minimum balance
during the notice period.
Further Redemption Information. Redemption proceeds for shares of the Fund
recently purchased by check may not be distributed until payment for the
purchase has been collected, which may take up to fifteen business days from the
purchase date. Shareholders can avoid this delay by utilizing the wire purchase
option.
Other than as described above, payment of the redemption proceeds will be made
within seven days after receipt of an order for a redemption. The Fund may
suspend the right of redemption or postpone the date at times when the NYSE or
the bond market is closed or under any emergency circumstances as determined by
the United States Securities and Exchange Commission (the "SEC").
If the Board of Directors determines that it would be detrimental to the best
interests of the remaining shareholders of the Fund to make a payment wholly or
partly in cash, the Fund may pay the redemption proceeds in whole or in part by
a distribution in-kind of readily marketable securities held by a Fund in lieu
of cash in conformity with applicable rules of the SEC. Investors generally will
incur brokerage charges on the sale of portfolio securities so received in
payment of redemptions.
Redemption Fee. The Fund is designed for long-term investors willing to accept
the risks associated with a long-term investment in the common stocks of
companies in the technology, technology-related and science industries. The Fund
is not designed for short-term traders whose frequent purchases and redemptions
can generate substantial cash flow. These cash flows can unnecessarily disrupt
the Fund's investment program. Short-term traders often redeem when the market
is most turbulent, thereby forcing the sale of underlying securities held by the
Fund at the worst possible time as far as long-term investors are concerned.
Additionally, short-term trading drives up the Fund's transaction
costs--measured by both commissions and bid/ask spreads--which are borne by the
remaining long-term investors. For these reasons, the Fund assesses a 3.00% fee
on the redemption of shares held for less than one year. Redemption fees will be
paid to the Fund to help offset transaction costs. The fee does not apply to any
shares purchased through reinvested distributions (dividends and capital gains).
This fee also does not apply to clients of the Adviser and its affiliates that
hold shares in IRA accounts or in retirement plans (such as 401(k), 403(b), 457,
Keogh, Profit Sharing Plans, and Money Purchase Pension Plans).
The Fund will use the first-in, first-out (FIFO) method to determine the
one-year holding period. Under this method, the date of the redemption will be
compared to the earliest purchase date of shares held in the account. If this
holding period is less than one year, the redemption fee will be assessed. In
determining "one year" the Fund will use the anniversary date of a transaction.
Thus, shares purchased on April 5, 1999, for example, will be subject to the fee
if they are redeemed on or prior to April 4, 2000. If they are redeemed on or
after April 5, 2000, the shares will not be subject to the redemption fee. The
redemption fee will be applied on redemptions of each investment made by a
shareholder that does not remain in the Fund for a one-year period from the date
of purchase.
DIVIDENDS AND DISTRIBUTIONS
At least 90% of each Class's net investment income will be declared as dividends
and paid annually. If an investor's shares are redeemed prior to the date on
which dividends are normally declared and paid, accrued but unpaid dividends
will be paid with the redemption proceeds. Substantially all the realized net
capital gains for each Class, if any, are declared and paid on an annual basis.
Dividends are payable to
699557.6
15
<PAGE>
investors of record at the time of declaration. For a discussion of the taxation
of dividends or distributions, see "Taxes."
The net investment income of each Class for each business day is determined
immediately prior to the determination of net asset value. Net investment income
for other days is determined at the time net asset value is determined on the
prior business day. Shares of each Class earn dividends on the business day
their purchase is effective but not on the business day their redemption is
effective. See "Purchase of Shares" and "Redemption of Shares."
Choosing a Distribution Option. Distribution of dividends from each Class may be
made in accordance with several options. A shareholder may select one of three
distribution options:
1. Automatic Reinvestment Option. Both dividends and capital gains distributions
will be automatically reinvested in additional shares of the Fund unless the
investor has elected one of the other two options.
2. Cash Dividend Option. Dividends will be paid in cash, and capital gains, if
any, will be reinvested in additional shares.
3. All Cash Option. Both dividends and capital gains distributions will be paid
in cash.
TAX CONSEQUENCES
The Fund intends to elect, effective for its fiscal year beginning November 1,
1998, to qualify under the Internal Revenue Code of 1986, as a regulated
investment company. Qualification as a regulated investment company relieves the
Fund of Federal income tax on net ordinary income and net realized capital gains
paid out to its stockholders. The Fund's policy is to distribute as dividends
each year 100% (and in no event less than 90%) of its investment company taxable
income. The Fund has adopted a policy of declaring dividends annually.
Distributions of net ordinary income and net short-term capital gains are
taxable to stockholders as ordinary income. Although corporate stockholders
would generally be entitled to the dividends-received deduction to the extent
that the Fund's income is derived from qualifying dividends from domestic
corporations, the Fund does not believe that any of its distributions will
qualify for this deduction.
The excess of net long-term capital gains over net short-term capital losses
realized and distributed by the Fund as capital gains distributions is taxable
to stockholders as long-term capital gains, irrespective of the length of time a
stockholder may have held its shares in the Fund. Long-term capital gains
distributions are not eligible for the dividends-received deduction referred to
above. If a stockholder that sells shares held for six months or less receives a
distribution taxable as long-term capital gain, any loss realized on the sale of
the shares will be a long-term capital loss to the extent of the distribution.
Distributions are taxable to investors whether received in cash or reinvested in
additional shares of the Fund. Any dividend or distribution received by a
stockholder shortly after the purchase of shares will reduce the net asset value
of the shares by the amount of the dividend or distribution. Furthermore, such
dividend or distribution, is subject to tax even though it is in effect, a
return of capital.
The redemption of shares may result in the stockholder's receipt of more or less
than the stockholder paid for its shares and, thus, in a taxable gain or loss to
the stockholder. If the redeemed shares have been held for more than one year,
the stockholder will generally realize a long-term capital gain or loss.
A preferential tax rate for long-term capital gains is currently applicable for
non-corporate shareholders. Capital gain dividends, designated as such in a
written notice to investors mailed not later than 60 days after the Fund taxable
year closes, will be taxed as long-term capital gain. However, if an investor
receives a capital gain dividend and sells shares after holding them for six
months or less (not including, for purposes of determining the length of the
holding period, periods during which the investor holds an
699557.6
16
<PAGE>
offsetting position), then any loss realized on the sale will be treated as
long-term capital loss to the extent of such capital gain dividend.
The Fund is required, subject to certain exemptions, to withhold at a rate of
31% from dividends paid or credited to stockholders, in addition to the proceeds
from the redemption of Fund shares, if a correct taxpayer identification number,
certified when required, is not on file with the Fund. Corporate stockholders
are not subject to this requirement.
DISTRIBUTION ARRANGEMENTS
Distributor. SEI Investments Distribution Co. ("SIDCO"), an affiliate of the
Administrator, has entered into a distribution agreement with the Fund to serve
as the Fund's distributor. SIDCO will be entitled to receive a distribution fee
equal to 0.25% of the Class A shares' average daily net assets under the terms
of the Plan and will pay the promotional and advertising expenses related to the
distribution of the Fund's shares and for the printing of all Fund prospectuses
used in connection with the distribution and sale of Fund shares. In addition,
pursuant to such distribution agreement, SIDCO may use a portion of the
distribution fee to compensate financial intermediaries for providing
distribution assistance with respect to the sale of Class A shares. See
"Management of Fund" in the Statement of Additional Information. SIDCO has
entered into a dealer agreement with Garal & Company, Inc., an affiliate of the
Adviser, to participate in the offer and sale of the shares of the Fund.
12b-1 Plan. The Fund, on behalf of each Class, has adopted a distribution and
service plan, pursuant to Rule 12b-1 under the Investment Company Act (the
"Rule"). The Rule provides that an investment company which bears any direct or
indirect expense of distributing its shares must do so only in accordance with a
plan permitted by the Rule. The Plan provides that each Class will compensate
the Adviser for certain expenses and costs incurred in connection with providing
shareholder servicing and maintaining shareholder accounts and to compensate
parties with which it has written agreements and whose clients own shares of
each Class for providing servicing to their clients ("shareholder servicing" ),
which is subject to a maximum service fee of 0.25% per annum of each Class's
average daily net assets. Because these fees are paid out of the Fund's assets
on an ongoing basis, over time these fees will increase the cost of your
investment and may cost you more than paying other types of sales charges. The
Plan also provides that the Distributor is paid a fee equal to 0.25% of Class
A's average daily net assets, on an annual basis, to enable it to provide
promotional support to the Fund and to make payments to broker-dealers and other
financial institutions with which it has written agreements and whose clients
are Class A shareholders (each a "broker-dealer") for providing distribution
assistance. Fees paid under the Plan may not be waived for individual
shareholders.
Each shareholder servicing agent that the Adviser retains will, as agent for its
customers, among other things: (i) answer customer inquiries regarding account
status and history, the manner in which purchases and redemptions of shares of
the Fund may be effected and certain other matters pertaining to the Fund; (ii)
assist shareholders in designating and changing dividend options, account
designations and addresses; (iii) provide necessary personnel and facilities to
establish and maintain shareholder accounts and records; (iv) assist in
processing purchase and redemption transactions; (v) arrange for the wiring of
funds; (vi) transmit and receive funds in connection with customer orders to
purchase or redeem shares; (vii) verify and guarantee shareholder signatures in
connection with redemption orders and transfers and changes in shareholder
designated accounts; (viii) furnish (either separately or on an integrated basis
with other reports sent to a shareholder by the Fund) quarterly and year-end
statements and confirmations in a timely fashion after activity is generated in
the account; (ix) transmit, on behalf of the Fund, proxy statements, annual
reports, updating prospectuses and other communications from the Fund to
shareholders; (x) receive, tabulate and transmit to the Fund, proxies executed
by shareholders with respect to meetings of shareholders of the Fund; and (xi)
provide such other related services as the Fund or a shareholder may request.
699557.6
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<PAGE>
The Plan provides that the Adviser and the Distributor may make payments from
time to time from their own resources which may include the advisory fee and
past profits for the following purposes: (i) to defray the costs of and to
compensate others, including financial intermediaries with whom the Distributor
or Adviser has entered into written agreements, for performing shareholder
servicing and related administrative functions; (ii) to compensate certain
financial intermediaries for providing assistance in distributing each Class's
shares; (iii) to pay the costs of printing and distributing the Fund's
prospectus to prospective investors; and (iv) to defray the cost of the
preparation and printing of brochures and other promotional materials, mailings
to prospective shareholders, advertising, and other promotional activities,
including the salaries and/or commissions of sales personnel in connection with
the distribution of the Fund's shares. The Distributor or the Adviser, as the
case may be, in their sole discretion, will determine the amount of such
payments made pursuant to the Plan with the shareholder servicing agents and
broker-dealers they have contracted with, provided that such payments made
pursuant to the Plan will not increase the amount which the Fund is required to
pay to the Distributor or the Adviser for any fiscal year under the shareholder
servicing agreements or otherwise. Any servicing fees paid to the Adviser also
may be used for purposes of (i) above and any asset based sales charges paid to
the Distributor also may be used for purposes of (ii), (iii), or (iv) above.
Shareholder servicing agents and broker-dealers may charge investors a fee in
connection with their use of specialized purchase and redemption procedures
offered to investors by the shareholder servicing agents and broker-dealers. In
addition, shareholder servicing agents and broker-dealers offering purchase and
redemption procedures similar to those offered to shareholders who invest in the
Fund directly may impose charges, limitations, minimums and restrictions in
addition to or different from those applicable to shareholders who invest in the
Fund directly. Accordingly, the net yield to investors who invest through
shareholder servicing agents and broker-dealers may be less than by investing in
the Fund directly. An investor should read the Prospectus in conjunction with
the materials provided by the shareholder servicing agent and broker-dealer
describing the procedures under which Fund shares may be purchased and redeemed
through the shareholder servicing agent and broker-dealer.
699557.6
18
<PAGE>
FINANCIAL HIGHLIGHTS INFORMATION
The following table is intended to help you understand the Fund's financial
performance since its inception. Certain information reflects financial results
for a single Fund share. The total returns in the table represent the rate that
an investor would have earned (or lost) on an investment in the Class A and
Class D shares of the Fund (assuming reinvestment of all dividends and
distributions). This information has been audited by Morrison, Brown, Argiz &
Co, P.A., whose report, along with the Fund's financial statements, are included
in the annual report, which is available upon request. The table is part of the
Fund's financial statements for the year ended December 31, 1998, which are
available to shareholders upon request.
<TABLE>
<CAPTION>
CLASS A SHARES For the period
August 3, 1998
(commencement of
operations) through
December 31, 1998
----------------------------
<S> <C>
Net asset value, beginning of period....................................................... $ 8.44
----------------------------
Income (loss) from investment operations:
Net investment loss........................................................................ (0.10)
Net realized and unrealized gain (loss) on investments..................................... 5.25
----------------------------
Total from investment operations........................................................... 5.15
----------------------------
Less distributions:
Dividends from net investment income....................................................... 0.00
Distributions from realized gains from security transactions............................... 0.00
Total distributions........................................................................ 0.00
----------------------------
Net asset value, end of period............................................................. $ 13.59
============================
Total return**............................................................................. 61.02%
Ratios/supplemental data:
Net assets end of period (in 000's)........................................................ $ 803
Ratio of expenses to average net assets.................................................... 2.86%*
Ratio of expenses to average net assets, net of reimbursement.............................. 2.50%*
Ratio of net investment income (loss) to average net assets................................ (2.76%)*
Ratio of net investment income (loss) to average net assets, net of reimbursement.......... (2.40%)*
Portfolio turnover rate.................................................................... 78.46%
</TABLE>
- ------------------
* Annualized
** Based on net asset value per share
699557.6
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<PAGE>
<TABLE>
CLASS D SHARES
<CAPTION>
For the period
October 29, 1996
(commencement
For the fiscal year ended December 31, of investment
------------------------------------- operations) through
1998 1997 December 31, 1996
---- ---- -----------------
<S> <C> <C> <C>
Net asset value, beginning of period $7.37 $9.00 $10.00
----- ----- ------
Income (loss) from investment operations:
Net investment loss (0.20) (0.16) (0.04)
Net realized and unrealized gain (loss) on
investments 6.44 (1.47) (0.96)
---- ------ ------
Total from investment operations 6.24 (1.63) (1.00)
---- ------ ------
Less distributions:
Dividends from net investment income 0.00 0.00 0.00
Distribution from realized gains from
security transactions 0.00 0.00 0.00
Total distributions 0.00 0.00 0.00
---- ----- -----
Net asset value, end of period $13.61 $7.37 $9.00
====== ===== ======
Total return** 84.67 (18.11%) (45.69%)*
Ratios/supplemental data:
Net assets end of period (in 000's) 64,194 40,191 34,210
Ratio of expenses to average net assets 2.75% 2.83% 3.82%*
Ratio of expenses to average net assets, net
of reimbursement 2.25% 2.25% 2.25%*
Ratio of net investment income (loss) to
average net assets (2.72%) (2.83%) (3.82%)*
Ratio of net investment income (loss) to
average net assets, net of reimbursement (2.21%) (2.25%) (2.25%)*
Portfolio turnover rate 78.46% 355.21% 0.00%
</TABLE>
- ----------------------
* Annualized
** Based on net asset value per share
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20
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<TABLE>
<CAPTION>
AMERINDO FUNDS INC. For assistance in completing the application,
Mail to: Amerindo Technology Fund call the Amerindo Technology Fund at
c/o American Data Services, Inc. 1-888-TECH FUND (832-4386)
P.O. Box 5536, Hauppauge
N.Y. 11788-1032
Amerindo Technology Fund-New Account Application
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<S><C>
1. INITIAL INVESTMENT
|_| Class A $_______________ ($2,500 minimum)
|_| Class D $_______________ ($2,500 minimum)
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2. ACCOUNT REGISTRATION
|_| Individual ____________________________________________________________________________ if joint, check one:
first middle last |_| With Right of
Survivorship
|_| Tenants in
Common
|_| Joint Tenant ___________________________________________________________________________ |_| Tenants by the
first middle last Entireties
|_| Uniform Gifts/Transfers to Minors Act _____________________________________________________________________
Custodian's Name
Minor's Birthdate ___/___/___
as Custodian for ________________________________________________ State of Residency________________________
Minor's Name
|_| Corporation, Trust Partnership, or other Entity ____________________________________________________________
Legal Entity Name
______________________________________________________________________________________________________
Trustee's Name (for trust only) Date of Trust (if applicable)
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3. ACCOUNT ADDRESS
Street Address ___________________________________________________________________________________
City/State/Zip ___________________________________________________________________________________
___________________________________________________________________________________
Daytime Telephone ___________________________________________________________________________________
Citizen of: |_| U.S. |_| Other Country _______________________________ (e-mail address) ______________
Country of Residence
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4. SOCIAL SECURITY/TAX IDENTIFICATION NUMBER
___________________________________________________ or ________________________________________________
Social Security Number Taxpayer Identification Number
699557.6
<PAGE>
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5. SOURCE OF INTEREST (PLEASE SPECIFY)
|_| Advertisement ________________________________________ |_| TV/Newspaper _________________________________
|_| Internet |_| Referral _______________________________ |_| Other ________________________________________
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6. DISTRIBUTIONS
Dividends and capital gains will be automatically reinvested unless otherwise indicated. If you wish Dividend/Capital Gains to be
paid in cash, please check the appropriate box.
Dividends are to be: |_| Paid in Cash Capital gains are to be: |_| Paid in Cash
- ------------------------------------------------------------------------------------------------------------------------------------
7. LETTER OF INTENT (LOI) FOR CLASS A SHARES
|_| I agree to the terms of the Letter of Intent and provisions set forth in the Prospectus. Although I am not obligated to do so,
it is my intention to invest over a 13 month period:
|_| $50,000 but less than $100,000 |_| $250,000 but less than $500,000 |_| $1,000,000 or more
|_| $100,000 but less than $250,000 |_| $500,000 but less than $1,000,000
(purchases made within the last 90 days will be applied towards LOI amount)
- ------------------------------------------------------------------------------------------------------------------------------------
8. AUTOMATIC INVESTMENT PLAN
|_| Each month, I would like to have American Data Services draw an Automatic Clearing House (ACH) debit electronically against the
account of my Financial Institution listed below, to purchase shares of the AMERINDO TECHNOLOGY FUND.
I understand that the shares of the Fund are purchased on the day of the debit. I also understand that if the automatic purchase
cannot be made due to insufficient funds or stop payment, a $15.00 fee will be assessed.
Please mark one of your personal checks "VOID" and attach the voided check to this application, or fill in the information below. As
soon as your Financial Institution accepts your authorization, debits will be generated and purchases of Fund shares will begin.
Please note that your Financial Institution must be able to accept ACH transactions. Please allow one month for processing of this
Automatic Investment Plan option before the first debit occurs.
Please begin Automatic Investing for me and invest $___________ ($100 minimum) in shares of the Fund on the:
|_| 10th
|_| 20th of each month, or first business day thereafter.
____________________________________________________________________________________________________________________________________
Name of my Financial Institution Address of my Financial Institution Type of Account (checking/savings)
____________________________________________________________________________________________________________________________________
My Financial Institution's ABA Number My Account Number Name(s) on Account
I understand that my ACH debit will be dated each month on the day specified above. I agree that if such debit is not honored upon
presentation, American Data Services may discontinue this service, and any purchase of Fund shares may be reversed. I further
understand that the net asset value of the shares of the Fund at the time of such reversal may be less than the net asset value on
the day of the original purchase. American Data Services is authorized to redeem sufficient additional full and fractional shares
from my account to make up the deficiency. The Automatic Investment Plan may be discontinued by American Data Services upon 30 days
written notice or by the investor by written notice to American Data Services provided the notice is received no later than 5
business days prior to the specified investment date.
____________________________________________________________________________________________________________________________________
Signature of Depositor Signature of Co-Depositor (required for joint accounts) Date
699557.6
<PAGE>
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9. TELEPHONE REDEMPTIONS
If you do not want telephone redemption privileges, check here. |_|
I (we) authorize The Amerindo Funds and its agents to act upon instructions, from shareholder or dealer of record, received by
telephone or letter, to have amounts wired to my (our) bank account designated below or mailed to the address of record established
for this account. I (we) ratify any such instructions. If you will be utilizing the bank wiring option, please attach a voided check
from your bank account and complete the information below.
____________________________________________________________________________________________________________________________________
Bank Name
____________________________________________________________________________________________________________________________________
Street
____________________________________________________________________________________________________________________________________
City State Zip Code
____________________________________________________________________________________________________________________________________
Account Name
____________________________________________________________________________________________________________________________________
ABA Routing Number Account Number
- ------------------------------------------------------------------------------------------------------------------------------------
10. INFORMATION RELEASE TO AND INSTRUCTIONS FROM DEALER/SERVICE ORGANIZATIONS (IF APPLICABLE)
|_| I hereby authorize the Fund and American Data Services to accept instructions from and transmit information (such as account
statements) to the dealer/service organization designated in Section 12 below.
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11. SIGNATURE & CERTIFICATION FOR THE IRS (US INVESTORS ONLY)
Each of the undersigned has the authority and legal capacity to purchase mutual fund shares, each is of legal age in their state and
believes each investment is suitable for themselves. Each of the undersigned has received and read the Prospectus and agrees to its
terms.
Certification - under penalties of perjury, I certify that:
(1) The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me),
and (2) I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been notified by
the Internal Revenue Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or
dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding.
Certification Instructions - you must cross out item (2) above if you have been notified by the IRS that you are currently subject
to backup withholding because of underreporting interest or dividends on your tax return.
The Internal Revenue Service does not require your consent to any provision of this document other than the certifications required
to avoid backup withholding.
______________________________________________ _______________________________________________ _____________________________
Signature Signature Date
* If joint account, all tenants must sign **If corporate account or other legal entity, authorized person must sign in capacity.
- ------------------------------------------------------------------------------------------------------------------------------------
699557.6
<PAGE>
12. FOR DEALER/SERVICE ORGANIZATION USE ONLY
We hereby submit this application for the purchase of shares of the Fund in accordance with the terms of our selling agreement with
ADS Distributors, Inc. ("Distributor") and with the Fund's prospectus. We agree to notify the Distributor of any purchases of Class
A shares which may be eligible for reduced or eliminated sales charges.
____________________________________________________________________________________________________________________________________
Firm's Name Account Rep. Name
____________________________________________________________________________________________________________________________________
Branch Address Branch Telephone Number
____________________________________________________________________________________________________________________________________
Fund Assigned Firm Number Fund Assigned Branch Number Fund Assigned Rep Number
____________________________________________________________________________________________________________________________________
Authorized Signature of Dealer
</TABLE>
699557.6
<PAGE>
Amerindo Technology Fund
Board of Directors
--------------------------
Alberto W. Vilar Amerindo Investment Advisors Inc.
Gary A. Tanaka Amerindo Investment Advisors Inc.
John Rutledge Rutledge Capital LLC
Jude T. Wanniski Polyconomics, Inc.
Officers of Fund
---------------------------
Alberto W. Vilar Chairman of the Board
Gary A. Tanaka President
Anthony Ciulla Vice President
Dana E. Smith Vice President
<PAGE>
<TABLE>
<CAPTION>
AMERINDO TECHNOLOGY FUND
May 1, 1999
<S> <C>
Investment Adviser A Statement of Additional Information (SAI), dated
Amerindo Investment Advisors Inc. May 1, 1999, and the Fund's Annual and Semi-
San Francisco, California Annual Reports include additional information about
New York, New York the Fund and its investments and are incorporated by
reference into this prospectus. In the Fund's Annual
Administrator and Report is a discussion of the market and investment
Transfer and Dividend Agent strategies that significantly affected the Fund's
American Data Services, Inc. performance during its last fiscal year. You may
Hauppauge, New York obtain the SAI, the Annual and Semi-Annual
Reports and material incorporated by reference
Distributor without charge by calling the Fund at 1-888-TECH-
SEI Investments Distribution Co. FUND. To request other information, please call
Oaks, Pennsylvania 19456 your financial intermediary or the Fund.
Custodian A Current SAI has been filed with the Securities and
The Northern Trust Company Exchange Commission. You may visit the Securities
Chicago, Illinois and Exchange Commission's Internet website
(www.sec.gov) to view the SAI, material
Legal Counsel incorporated by reference and other information.
Battle Fowler LLP These materials can also be reviewed and copied at
New York, New York the Commission's Public Reference Room in
Washington, D.C. Information on the operation of
Independent Auditors the Public Reference Room may be obtained by
Morrison, Brown, Argiz & Company calling the Commission at 1-800-SEC-0330. In
Miami, Florida addition, copies of these materials may be obtained,
upon payment of a duplicating fee, by writing the
1-888-TECH FUND Public Reference Section of the Commission,
www.amerindo.com Washington, DC 20549-6009.
</TABLE>
811-07531
699557.6
