Rule 497(e)
Registration No. 333-00767
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AMERINDO FUNDS INC PROSPECTUS
Class A Shares; Class C Shares December 15, 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.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Risk/Return Summary......................................2 How to Purchase Shares.................................10
Fee Table................................................4 For Class A Shareholders Only:
Reduction or Elimination of Sales Loads................12
Investment Objectives, Principal Investment
Strategies and Related Risks.............................5 How to Redeem Shares...................................13
Additional Investment Information and Dividends and Distributions............................14
Risk Factors.............................................6
Tax Consequences.......................................15
Management, Organization and Capital
Structure................................................7
Distribution Arrangements..............................15
Pricing of Fund Shares...................................9 Financial Highlights Information.......................18
</TABLE>
<PAGE>
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. Therefore, investors should consider
this greater risk versus the safety that comes with a more
diversified portfolio.
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.
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 for Class D shares of the
Fund for the life of the Fund. The table shows how the Fund's Class D shares'
average annual returns for a one-year period compares with that of the Hambrecht
& Quist Growth Index.* The chart and table show returns for a Class that is not
offered by this Prospectus since the Class A and Class C shares have not been in
existence for a full calendar year. The Class presented has substantially
similar returns because the shares are invested in the same portfolio of
securities. The annual returns will differ only to the extent that the Class
does not have the same expenses. Specifically, investors purchasing Class A
shares will be charged a sales charge of 5.75%. See the Fee Table. 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.
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[RISK RETURN BAR CHART IS TO BE INSERTED HERE]
Best Quarter 12/31/98: 49.07% ...... Worst Quarter 3/31/97: (28.89%)
<TABLE>
<CAPTION>
<S> <C> <C>
Average Annual Total Returns (for the periods ending Past One Year Since Inception (4)
12/31/98)(2)(3)
Amerindo Technology Fund - Class A Shares Hambrecht & NA 54.61%**
Quist Growth Index* 45.10% 36.26%+
Amerindo Technology Fund - Class D Shares 84.67% 15.22%
Hambrecht & Quist Growth Index* 45.10% 17.59%
</TABLE>
* 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) Investors purchasing Class D shares are not charged a sales load,
therefore, a sales load is not reflected in the Bar Chart. If this
amount was reflected, returns would be less than those shown.
(2) Class A shares 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) The date of inception of the Class A shares was August 3, 1998. The
date of inception of the Class D shares was October 28, 1996.
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<PAGE>
FEE TABLE
This table describes the fees and expenses that you may pay if you buy and hold
shares of the Fund.
<TABLE>
<CAPTION>
Class A Class C
-------- --------
<S> <C> <C>
Shareholder Fees
(fees paid directly from your investment)
Maximum Sales Load Imposed on Purchases 5.75% None
(as a percentage of the offering price)
Maximum Deferred Sales Charge for shares held less than 1 year None 1.00%
(as a percentage of the lesser of original purchase price or redemption
proceeds)
Redemption Fees for shares held less than 1 year 2.00% 2.00%
(as a percent of amount redeemed, if applicable)
Annual Fund Operating Expenses(1)
(expenses that are deducted from Fund assets)
Management Fees 1.50% 1.50%
Distribution and/or Service 12b-1 Fees 0.25% 1.00%
Other Expenses(2) 1.00% 1.00%
----- -----
Total Annual Fund Operating Expenses 2.75% 3.50%
Fee Waiver/Expense Reimbursement 0.50% .50%
----- ----
Net Total Annual Fund Operating Expenses 2.25% 3.00%
</TABLE>
(1) The Adviser reimbursed the Fund 0.50% of the Adviser's fee. After this
reimbursement, the "Other Expenses" and "Total Annual Fund Operating
Expenses" were 0.50% and 2.50%, respectively, for the Class A shares. The
"Total Annual Fund 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 is contractually
obligated to waive its fees and to reimburse any expenses to the extent
that the Total Annual Fund Operating Expenses exceed 2.25%. This Expense
Limitation Agreement will terminate on December 31, 2000 unless renewed.
(2) Estimated because there were no Class C shares issued during the fiscal
year ended October 31, 1999.
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:
<TABLE>
<CAPTION>
Year 1 Year 3 Year 5 Year 10
<S> <C> <C> <C> <C>
Class A $814 $1309 $1829 $3248
Class C $303 $1028 $1774 $3741
</TABLE>
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<PAGE>
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.
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
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<PAGE>
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.
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
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879253.6
<PAGE>
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 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.
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<PAGE>
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.
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. The advisory 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. 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
also voluntarily waive a portion of its fee or assume certain expenses of the
Fund. The Adviser is contractually obligated to waive its fees and to reimburse
any expenses to the extent that the Total Annual Fund Operating Expenses exceed
2.25% for Class A and 3.00% for Class C. This Expense Limitation Agreement will
terminate on December 31, 2000 unless renewed. The contractual waiver and any
voluntary waivers or reimbursement 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 1980s, 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, 1998, and has confirmed that
Amerindo's performance presentation contained herein for such period conforms
with AIMR standards. 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
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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 & 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, 1998, 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.
<TABLE>
<CAPTION>
Year Asset Weighted Asset Weighted S&P 500 H&Q Russell
Composite Rate of Composite Rate of Index Growth 2000
Return Net of Return Gross of Index Growth
Advisory Fees Advisory Fees Index
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
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% 20.36% 20.16% 11.82%
</TABLE>
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 with respect to Class D for the period October 28, 1996
(commencement of operations) through December 31, 1998 was 15.22%. The Fund's
total return with respect to Class D 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 the net asset value once daily on Monday through Friday, at
the regularly scheduled close of normal trading on the New York Stock Exchange,
which normally occurs at 4:00 p.m. Eastern time, except on New Year's Day,
Martin Luther King, Jr. Day, President's Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving and Christmas.
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<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 Bankers Trust Company from your bank. Your bank may charge a fee
for doing so (see instructions below). The minimum initial investment in Class A
and Class C 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:
Bankers Trust Company
New York, New York
ABA# 021001033
Account # 01-465-547
F/B/O Amerindo Technology Fund
ref: (class)
Fund Acct. No._____________
Social Security or Tax Identification 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 the minimum investment) payable to:
Amerindo Technology Fund
P.O. Box 446
Portland, ME 04112
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 investors will
be assessed a $15.00 charge.
Additional Investments. Additional investments may be made at any time (subject
to a minimum subsequent investment of $500) by purchasing shares 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 C) or by wiring monies to the clearing bank as
outlined above, or by telephone with payment by Automated Clearing House
("AACH"), electronically transferring funds from the investor's designated bank
account. In order to purchase shares by telephone and make payment by ACH, an
investor must complete the appropriate sections of the application. Shareholders
who have authorized telephone purchases may effect purchases by calling the
Transfer Agent at 1-888-TECH FUND.
Sales Charges. 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. See "Pricing
of Funds Shares" herein.
Class A shares
The purchase price paid for the Class A shares is the current public offering
price, that is, the next determined net asset value of the shares after the
order is placed plus the applicable sales charge. See "Net
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879253.6
<PAGE>
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. Volume
discounts are provided for initial purchase, as well as for additional purchases
of shares of the Fund. See "Reduction or Elimination of Sales Loads" herein. The
Fund reserves the right to reject any subscription for shares.
Class C shares
The Fund sells Class C shares without an initial charge but if the shares are
held less than one year, investors will pay a contingent deferred sales charge
("CDSC") of 1%. The amount of the CDSC is determined as a percentage of the
lesser of the current market value of the cost of the shares being redeemed.
Thus, when a share that has appreciated in value is redeemed during the CDSC
period, a CDSC is assessed only on its initial purchase price. Shares acquired
by reinvestment of distributions are not subject to the CDSC. The Fund will also
waive the CDSC for: (i) redemptions made within one year after death of a
shareholder or registered joint owner, (ii) minimum required distributions made
from an IRA or other individual retirement plan account after a shareholder
reaches age 70 1/2, or (iii) involuntary redemptions made by the Fund. Class C
shares provide the investor the benefit of putting all of the investor's dollars
to work from the time the investment is made rather than paying an upfront sales
charge.
Class C share may have a higher expense ratio and pay lower dividends than other
classes of shares offered by the Fund because the Class C shares bears a higher
12b-1 fee than other classes and because of other related expenses.
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 CDSC will be assessed. In determining
"one year" the Fund will use the anniversary date of a transaction. Thus, shares
purchased on November 2, 1999, for example, will be subject to the fee if they
are redeemed on or prior to November 1, 2000. If they are redeemed on or after
November 2, 2000, the shares will not be subject to the CDSC. The CDSC 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. In
determining whether a CDSC is payable on any redemption, shares not subject to
any charge will be redeemed first, followed by shares held longest during the
CDSC period. The CDSC ordinarily goes to the investor's broker-dealer as
compensation for the services provided the investor. In addition, Class C
investors will be charged a redemption fee of 2.00% for shares held less than 1
year. See "How to Redeem." The Fund reserves the right to reject any
subscription for shares.
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. See Distribution
Arrangements.
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.
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
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879253.6
<PAGE>
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.
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 C shares of the Fund. The minimum initial investment for all retirement
plans investing 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 Purchase Sale Charge Sales Charge as a % of Net Amount of sales charge
Amount Invested reallowed to dealers as
a percent 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% 4.05%
$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.
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,
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879253.6
<PAGE>
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 4:00 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, P.O. Box
446, Portland, ME 04112.
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 registered
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 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. 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
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879253.6
<PAGE>
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 2.00% 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 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.
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879253.6
<PAGE>
TAX CONSEQUENCES
The Fund intends to qualify annually and to elect to be treated as a regulated
investment company under the Internal Revenue Code of 1986 effective for its
taxable year beginning November 1, 1998. The Fund did so qualify for its
previous taxable year. By qualifying, the Fund will generally not be subject to
Federal income tax on net ordinary income and net realized capital gains paid
out to its stockholders. The Fund can also avoid an annual 4% excise tax if it
distributes substantially all of its taxable income and capital gain each year.
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 (which includes
interest, dividends and net short term capital gains). 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, without regard to the length of time
the 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. Long-term capital gains on sales of securities are currently taxable at a
maximum rate of 20% for non-corporate shareholders. Capital gain dividends,
designated in a notice mailed to investors not later than 60 days after the Fund
taxable year closes, will be taxed as long-term capital gain without regard to
the length of time for which the investor has held its shares. In determining
the amount of capital gains to be distributed, any capital loss carry over from
prior years will be taken into account in determining the amount of net 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 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.
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.
The Fund is required, subject to certain exemptions, to withhold at a rate of
31% from dividends paid or credited to stockholders and from the proceeds from
the redemption of Fund shares, if a correct taxpayer identification number,
certified when required, is not on file with the Fund, or if the Fund or the
shareholder has been notified by the Internal Revenue Service that the
shareholder is subject to these backup withholding rates. Corporate stockholders
are not subject to this requirement.
If the Fund invests in securities of foreign issuers, it may be subject to
withholding and other similar income taxes imposed by a foreign country.
Dividends and distributions may be subject to state and local taxes.
Dividends paid or credited to accounts maintained by non-resident shareholders
may also be subject to U.S. non-resident withholding taxes. You should consult
your tax adviser regarding specific questions as to Federal, state and local
income withholding taxes.
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. As agent for the Fund, the Distributor solicits
orders for the purchase of the Fund's shares, provided that any orders will not
be binding on the Fund until accepted by the Fund as principal. With respect to
the Class A shares, SIDCO will be entitled to receive a service fee equal to
0.25% of the Class A shares' average daily net assets under the terms of the
Plan and the Distribution Agreement. With respect to the Class C shares, SIDCO
will be entitled to receive a distribution fee equal to 0.75% pursuant to the
Distribution Agreement and a shareholder service fee equal to 0.25% of the Class
C shares' average daily net assets under the terms of the Plan and pursuant to
the Shareholders Servicing Agreement.
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
"Plan"). Rule 12b-1 provides that an investment
15
879253.6
<PAGE>
company which bears any direct or indirect expense of distributing its shares
must do so only in accordance with a plan permitted by this Rule. The Plan
provides that the Distributor will receive compensatory payments from the Fund
for soliciting orders for the purchase of Fund shares and for making payments to
broker-dealer and other financial institutions with which it has written
agreements and whose clients are Fund shareholders, for providing distribution
assistance on behalf of the Fund.
The total amounts payable under the Plan by the Class A and Class C shares of
the Fund may not exceed 0.25% and 1.00%, per annum, respectively. Fees paid
under the Plan may not be waived for individual shareholders.
Consistent with the Plan, under the Distribution Agreement the Distributor
receives from the Class C shares of the Fund a compensatory distribution fee
equal to 0.75% per annum of the Class C shares' average daily net assets. This
distribution fee is an asset-based sales charge. The Distributor use this fee to
make payments to broker-dealer and other financial institutions with which it
has written agreements and whose clients are Class C shareholders for providing
distribution assistance for sales of the Class C shares. The fees are accrued
daily and paid monthly.
The Plan also provides that with respect to Class C, the Fund will compensate
the Distributor 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 Class C for providing servicing to their clients ("shareholder
servicing"). Because these fees are paid out of the Fund's asset 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.
Under the Shareholder Servicing Agreement, the Distributor receives a maximum
service fee of 0.25% per annum of the Class C's average daily net assets. The
fees are accrued daily and paid monthly. The Distributor uses this fee to
perform, or to arrange to have others perform, under the Distribution Agreement.
The shareholder servicing agents that the Distributor retains will perform the
following services: (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 transaction; (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.
In addition, the Plan provides that the Distributor and Advisor may make
payments from time to time from its own resources (which may include past
profits) for the following purposes: (i) to defray the costs of and to
compensate others, including financial intermediaries with whom the Distributor
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, in its sole discretion, will
determine the amount of such payments made pursuant to the Plan with the
shareholder servicing agents and broker-dealers with whom they have contracted,
provided that such payments made
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879253.6
<PAGE>
pursuant to the Plan will not increase the amount which the Fund is required to
pay to the Distributor for any fiscal year under the shareholder servicing
agreements or otherwise. Any servicing fees paid to the Distributor 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.
17
879253.6
<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). (Financial highlight information is unavailable for Class C
shares since there were no Class C shares issued during the periods covered by
this table.) 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
*** Not Annualized
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<PAGE>
CLASS D SHARES
<TABLE>
<CAPTION>
For the period October 29,
1996 (commencement of
For the fiscal year ended December 31, investment operations)
1998 1997 through 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%) (10.00%)***
-----------------
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
*** Not Annualized
19
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<PAGE>
Amerindo Technology Fund
Board of Directors
Alberto W. Vilar.................................Amerindo Investment Advisors
Gary A. Tanaka...................................Amerindo Investment Advisors
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
20
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<PAGE>
AMERINDO TECHNOLOGY FUND
December 15, 1999
Investment Advisor
Amerindo Investment Advisors Inc.
San Francisco, California
New York, New York
Administrator
SEI Investments Mutual Funds Services
Oaks, Pennsylvania
Distributor
SEI Investments Distribution Co.
Oaks, Pennsylvania
Transfer and Dividend Agent
Forum Shareholder Services LLC
Portland, Maine
Custodian
The Northern Trust Company
Chicago, Illinois
Legal Counsel
Battle Fowler LLP
New York, New York
Independent Auditors
Morrison, Brown, Argiz & Company
Miami, Florida
1-888-TECH FUND
www.amerindo.com
811-07531
A Statement of Additional Information (SAI), dated December 15, 1999, and the
Fund's Annual and Semi-Annual Reports include additional information about the
Fund and its investments and are incorporated by reference into this prospectus.
In the Fund's Annual Report is a discussion of the market and investment
strategies that significantly affected the Fund's performance during its last
fiscal year. You may obtain the SAI, the Annual and Semi-Annual Reports and
material incorporated by reference without charge by calling the Fund at
1-888-TECHFUND. To request other information, please call your financial
intermediary or the Fund.
A Current SAI has been filed with the Securities and Exchange Commission. You
may visit the Securities and Exchange Commission's Internet website
(www.sec.gov) to view the SAI, material incorporated by reference and other
information. These materials can also be reviewed and copied at the Commission's
Public Reference Room in Washington, DC. Information on the operation of the
Public Reference Room may be obtained by calling the Commission at
1-800-SEC-0330. In addition, copies of these materials may be obtained, upon
payment of a duplicating fee, by writing the Public Reference Section of the
Commission, Washington, DC 20549-6009.
21
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