<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /X/
POST-EFFECTIVE AMENDMENT NO. 72 /X/
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT /X/
OF 1940
AMENDMENT NO. 27 /X/
(CHECK APPROPRIATE BOX OR BOXES)
THE AMERICAN HERITAGE FUND, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
1370 AVENUE OF THE AMERICAS, NEW YORK, NY 10019
------------------------------------------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE 212-397-3900
JONATHAN B. REISMAN, 5100 TOWN CENTER CIRCLE, BOCA RATON, FL 33486
(NAME AND ADDRESS OF AGENT FOR SERVICE)
IT IS PROPOSED THAT THIS FILING WILL BECOME EFFECTIVE (CHECK APPROPRIATE BOX):
<TABLE>
<S> <C> <C> <C>
/ / IMMEDIATELY UPON FILING PURSUANT TO / / ON (DATE) PURSUANT TO PARAGRAPH
PARAGRAPH (b) (b)
/X/ 60 DAYS AFTER FILING PURSUANT TO / / ON (DATE) PURSUANT TO PARAGRAPH
PARAGRAPH (a)(1) (a)(1)
/ / 75 DAYS AFTER FILING PURSUANT TO / / ON (DATE) PURSUANT TO PARAGRAPH
PARAGRAPH (a)(1) (a)(2) OF RULE 485
</TABLE>
IF APPROPRIATE, CHECK THE FOLLOWING BOX:
/ / THIS POST-EFFECTIVE AMENDMENT DESIGNATES A NEW EFFECTIVE DATE
FOR A PREVIOUSLY FILED POST-EFFECTIVE AMENDMENT.
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PART A
<PAGE> 3
THE AMERICAN HERITAGE FUND, INC.
PROSPECTUS
The Fund is a no-load mutual fund which seeks maximum capital growth.
AS WITH ALL MUTUAL FUNDS, NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY
STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR
DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
, 2000
<PAGE> 4
TABLE OF CONTENTS
RISK/RETURN SUMMARY.................................................... 3
INVESTMENT OBJECTIVE AND PRINCIPAL
INVESTMENT STRATEGIES......................................... 8
FINANCIAL HIGHLIGHTS.................................................. 10
MANAGEMENT'S DISCUSSION OF OUR PERFORMANCE............................ 10
MANAGEMENT............................................................ 11
PRICING OF SHARES..................................................... 11
PROCEDURES FOR BUYING FUND SHARES..................................... 12
PROCEDURES FOR REDEEMING FUND SHARES.................................. 13
DISTRIBUTIONS AND TAXES............................................... 14
SHAREHOLDER SERVICES.................................................. 14
LEGAL PROCEEDINGS..................................................... 15
CUSTODIAN AND TRANSFER AGENT.......................................... 16
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RISK/RETURN SUMMARY
INVESTMENT OBJECTIVE
Our investment objective is to seek maximum capital growth. Income from our
investment portfolio will be only an incidental consideration and entirely
subordinate to our investment objective.
PRINCIPAL INVESTMENT STRATEGIES
We intend to achieve our investment objective by investing a majority of our net
assets in speculative investments in small and virtually unknown companies,
including companies that have never earned a profit. We may also engage in
speculative activities such as short-term trading, leveraging through borrowing,
short sales, the purchase and sale of put and call options and warrants, the
writing of listed put and call options and the purchase of foreign securities.
An investment in the Fund is not a complete investment program. We may not, at
any particular time, engage in all or any of the investment activities described
in this prospectus. The activities may be engaged in only periodically or not at
all.
Fundamental analysis plays the most important role in choosing the stocks that
we decide to purchase. We review both the available financial data as well as
the experience of the management. In the case of lesser known companies, we
often meet with their management before we make a positive investment decision.
We make our assessment of the growth potential of individual companies after our
review.
We generally identify companies as potential investments based upon our belief
in their future growth potential and the actual share price. Our intention is to
identify companies which promise a price appreciation over the following 12
months of at least 20%. We also consider companies that have fallen out of favor
and might not immediately recover to previous levels.
PRINCIPAL RISKS
Investing in securities is inherently risky, and there is no guarantee that we
will achieve our investment objective and you may lose money by investing in the
Fund. Many of the techniques which we may utilize involve greater than normal
risk and attainment of our investment objective cannot, of course, be assured.
An investment in the Fund is not a complete investment program and is designed
for investors willing to assume risks inherent in our investment policies and
practices. Investors should carefully consider all of the risks described below
as well as the risks described elsewhere in this prospectus:
- - MARKET RISKS. The price of particular securities may fall because of
declines in the stock market regardless of the success of individual companies'
businesses. We invest in securities not listed in the Standard and Poor's 500
Index. These securities may perform poorly and the
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Standard and Poor's 500 Index as well as other recognized indices may outperform
us.
- - SPECULATIVE SECURITIES. We purchase securities issued by companies
which are speculative. These securities may lose all or substantially all their
value. In addition, because earnings, if any, tend to be less predictable,
market prices are more volatile and the speculative securities less liquid than
those of larger, more established companies. In the case of speculative debt
securities, changes in economic conditions or other circumstances are more
likely to lead to a weakened capacity to make principal and interest payments
than is the case with higher grade debt securities. Speculative debt securities
may include obligations of issuers that are in default or in bankruptcy when we
believe that the prospect of capital appreciation outweighs the risk of
investment. The risk of investing in those securities, as well as other debt
securities, can be substantial because their value is based upon the ability of
the issuer to make all required payments of interest and principal. We may
purchase and sell put and call options without limitation and we make short
sales. A relatively small percentage movement in the price of the security which
is the subject of an option can result in a total loss of our investment in the
option. An unsuccessful short sale can result in a substantial loss. On April
13, 2000, the securities of each of two companies which are speculative
represented approximately 74% and 14% of the value our net assets.
- - WE ARE NOT A DIVERSIFIED INVESTMENT COMPANY. Subject only to the
restrictions described in this prospectus, we can invest without limitation in
the securities of any one or more companies.
- - UNDERVALUED SECURITIES. We may purchase securities that we believe the
market undervalues in relation to their actual worth. We assume that the market
will ultimately recognize the actual worth of these companies, thus causing
their stock prices to rise. The market may, however, indefinitely undervalue
these securities, causing their prices to remain the same or decline. In
addition, our belief that the securities are undervalued may be incorrect.
- - SECURITIES PAYING LITTLE OR NO DIVIDENDS. We purchase the securities of
companies that expect their earnings, if any, to rise and which pay little, if
any, dividends. Those securities are risky because their stock prices often
decline in market downturns.
- - MONEY MARKET SECURITIES. Under adverse market conditions, we could
invest some or all of our assets in money market securities. Although we would
do so only in seeking to avoid losses, it could reduce the benefit from any
upswing in the market.
- - EXPENSES. Because of our extremely small size, our aggregate annual
operating expenses as a percentage of our net assets is substantially higher
than those of most other mutual funds.
- - SHORT TERM TRADING. We have at times engaged, and may again engage, in
extensive, active and frequent short term trading. Short term trading may
increase capital gains distributions, which in turn would increase your tax
liability. Frequent trading will also increase
4
<PAGE> 7
our transaction costs, which may reduce our investment performance. Our past
short term trading activities have resulted in significant losses.
- - FOREIGN SECURITIES. We may purchase securities issued by companies
organized in foreign countries. The foreign countries may have either developed
or emerging markets. Foreign securities markets generally are not as developed
or efficient as those in the United States. Securities of some foreign issuers
are less liquid and more volatile than securities of comparable U.S. issuers.
Similarly, volume and liquidity in most foreign securities markets are less than
in the United States and, at times, volatility of price can be greater than in
the United States. Because evidences of ownership of foreign securities usually
are held outside the United States, we will be subject to additional risks which
include possible adverse political and economic developments, seizure or
nationalization of foreign deposits and adoption of governmental restrictions
which might adversely affect or restrict the payment of principal, interest and
dividends on the foreign securities to investors located outside the country of
the issuer, whether from currency blockage or otherwise. Moreover, foreign
securities held by us may trade on days when we do not calculate our net asset
value and thus affect the our net asset value on days when investors cannot
purchase or redeem our shares. Developing countries have economic structures
that are generally less diverse and mature, and political systems that are less
stable, than those of developed countries. The markets of developing countries
may be more volatile than the markets of more mature economies; however, such
markets may provide higher rates of return to investors. Many developing
countries have experienced substantial, and in some periods extremely high,
rates of inflation for many years. Inflation and rapid fluctuations in inflation
rates have had and may continue to have adverse effects on the economies and
securities markets of certain of these countries. Since foreign securities often
are purchased with and payable in currencies of foreign countries, the value of
these assets as measured in U.S. dollars may be affected favorably or
unfavorably by changes in currency rates and exchange control regulations. On
April 13, 2000, approximately 74% of the value of our net assets was represented
by our investment in a foreign company.
- - BROAD AND FLEXIBLE INVESTMENT POWERS. Because of our broad and flexible
investment powers, our success or failure may be more dependent upon our skill
and ability and less dependent upon movement of the securities market in general
than is the case with most mutual funds whose investment powers are not as broad
or as flexible.
- - BORROWING. We may borrow money to purchase additional securities. If
the investment performance of the securities purchased with borrowed monies
fails to cover our interest cost, our net asset value of the Fund will decrease
faster than would otherwise be the case. If for any reason, including market
fluctuations, the value of our assets falls below the coverage requirement of
the Investment Company Act of 1940, we may have to sell a portion of our
investments at a time when it may be disadvantageous to do so.
- - RESTRICTED AND OTHER ILLIQUID SECURITIES. We may acquire portfolio
securities called restricted securities, which are illiquid because they can be
sold only pursuant to an effective
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registration statement under the Securities Act of 1933 or an exemption from
such registration. We will have to bear the risk of market conditions prior to
any such registration or exemption. In the absence of an agreement obtained at
the time of purchase of such securities, there can be no assurance that the
issuer will register the restricted securities. Furthermore, if we dispose of
restricted securities without registration, it may be necessary to sell them at
a discount similar to or greater than that at which we purchased the securities.
Other securities held by us may be or become illiquid. Based solely upon the
reported trading volume of securities in our portfolio, on April 13, 2000,
securities representing approximately 85% of our net assets would be considered
to be illiquid. We believe, however, that on that date substantially all of our
securities were liquid. Our belief is based primarily upon offers we have
received from foreign companies, including a company whose investment decisions
are made by Heiko H. Thieme, to purchase securities from us at their then
current market values. Because the offers may be withdrawn at any time prior to
our acceptance, the degree of liquidity of our portfolio is subject to rapid
change. Although we intend to make, and always have made, cash payments for our
shares that are redeemed by our shareholders, depending on the future liquidity
of our portfolio, we may pay for redeemed shares in kind. See "Procedures for
Redeeming Fund Shares."
- - CHANGE IN MARKET PHILOSOPHY. Our principal investment strategies may
fall out of favor in the securities markets which would adversely affect our
performance.
- - LITIGATION. We and certain others are defendants in a purported class
action. See "Legal Proceedings."
PAST PERFORMANCE
The bar chart and performance table below illustrate some of the risks of
investing in the Fund. The bar chart shows the changes in our performance from
year to year from January 1, 1990 to December 31, 1999. The performance table
shows how our total return for one year, five year and ten year periods ended
December 31, 1999 compared with those of the Standard and Poor's 500 Index, a
broad measure of market performance. When you review the chart and table, be
aware that past investment performance does not necessarily indicate how we will
perform in the future.
ANNUAL TOTAL RETURNS FOR EACH CALENDAR YEAR
<TABLE>
<S> <C>
1990 30.8%
1991 97.1%
1992 19.3%
1993 41.4%
1994 35.3%
1995 -30.6%
1996 - 5.1%
1997 75.0%
1998 -61.2%
1999 -31.6%
</TABLE>
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During the periods shown above, our best quarter ended on March 31, 1991 during
which we had a return of 54% and our worst quarter ended on September 30, 1998
during which we had a return of -34%. Our total return from June 1, 1999 to
December 31, 1999 was -7.2%.
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
One Year Five Years Ten Years
-------- ---------- ---------
Year Ended Five Years Ended Ten Years Ended
December 31, 1999 December 31, 1999 December 31, 1999
----------------- ----------------- -----------------
<S> <C> <C> <C>
Fund -31.6% -21.1% -7.6%
S&P 500 21.0% 28.5% 18.2%
</TABLE>
SHAREHOLDER FEES AND EXPENSES
THE FOLLOWING TABLE DESCRIBES THE FEES AND EXPENSES THAT YOU MAY PAY IF YOU BUY
AND HOLD SHARES OF THE FUND.
SHAREHOLDER FEES
(fees paid directly from your investment)
Maximum sales charge (load) imposed on purchases
(as a percentage of offering price) None
Maximum deferred sales charge (load)
(as a percentage of offering price) None
Maximum sales charge (load) imposed on reinvested
dividends (as a percentage of offering price) None
Redemption fee (as a percentage of amount redeemed) None
Exchange fee None
ANNUAL FUND OPERATING EXPENSES
(expenses deducted from Fund assets)
Management fees 1.25%
Distribution (12b-1) and service fees None
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Other expenses 7.63% *
Total annual Fund operating expenses 8.88%
* Includes administrative expenses of approximately 1.43%.
EXAMPLE
The example below 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 for the time periods indicated;
- - you redeem all your shares at the end of those time periods;
- - your investment has a 5% return each year; and
- - our operating expenses remain the same.
Although your actual costs may be higher or lower, under these assumptions your
costs would be:
<TABLE>
<CAPTION>
Number
of Years 1 3 5 10
- -------- - - - --
<S> <C> <C> <C> <C>
$932 $2,678 $4,276 $7,704
</TABLE>
INVESTMENT OBJECTIVE AND PRINCIPAL
INVESTMENT STRATEGIES
Our investment objective is to seek maximum capital growth. Income from our
investment portfolio will be only an incidental consideration entirely
subordinate to the capital growth objective. Our investment objective cannot be
changed without shareholder approval. We seek maximum capital growth by
investing primarily in companies that we believe have above average potential
for growth or whose securities are undervalued in the market.
In contrast to most mutual funds, we intend to achieve our investment objective
by investing a majority of our net assets in speculative investments in small
and virtually unknown companies, including companies that have never earned a
profit. We also intend to through the use of certain speculative investment
techniques which entail greater than average risks which are described below.
Our success or failure may be more dependent upon our skill and ability and less
dependent upon movement of the securities market in general than is the case
with most mutual
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funds whose investment powers are not as broad or as flexible as ours.
Generally, more than 80% of the value of our assets, other than cash and cash
equivalents, will consist of common stocks and securities convertible into or
exchangeable for common stocks, such as rights, warrants and options. To a
limited degree, we may invest in preferred stocks and debt securities, such as
corporate bonds and debentures and securities issued by the United States
Government and its instrumentalities, when we believe that they offer
opportunities for growth of capital or are desirable in the light of prevailing
market or economic conditions. Debt securities we purchase may not be
"investment grade." Debt securities in the lowest category of investment grade
debt may have speculative characteristics and changes in economic conditions or
other circumstances are more likely to lead to a weakened capacity to make
principal and interest payments than is the case with higher grade debt
securities. Debt securities which are not "investment grade"may include
obligations of issuers that are in default or in bankruptcy. Naturally, the risk
of investing in those securities, as well as other debt securities, can be
substantial because their value is based upon the ability of the issuer to make
all required payments of interest and principal. Generally, debt securities
which we believe to offer opportunities for growth of capital, including
securities referred to as "junk bonds," may be purchased by us when we believe
(a) interest rates will decline and, therefore, the value of the debt securities
will increase, or (b) their market value is likely to appreciate due to factors
affecting specific issuers.
We may purchase restricted securities if we receive a substantial discount from
the market value of similar unrestricted securities. In addition, we may
purchase restricted securities issued by companies who do not have any publicly
traded securities.
We may engage in active and frequent trading.
We may borrow money from banks and use the borrowed money principally to
purchase additional securities. This technique may be used in order to increase
the amount of money available to us for investment in securities we believe have
appreciation potential and to increase the amount of money available to secure
short positions. All of our assets may be pledged as collateral for bank loans.
We may engage in short sales in an attempt to protect against downward market
movement. A short sale is made by selling a security which the seller does not
own in the hope of purchasing the same security at a later date at a lower
price. In order to make delivery to the buyer and thus effect a sale, we must
borrow the security and agree to replace the security, whatever its price may be
at the time we purchase it for delivery to the lender.
We invest in foreign companies. Although we intend to invest in foreign
companies located in nations which we consider to have relatively stable
governments, there is the possibility of expropriation, nationalization or
confiscatory taxation, taxation of income earned in a foreign country and other
foreign taxes, foreign exchange controls (which may include suspension of the
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ability to transfer currency from a country), default in foreign government
securities, political or social instability or diplomatic developments which
could adversely affect investments in securities of foreign companies. issuers.
We buy securities based upon our belief that the market has undervalued them in
relation to their actual worth or because of the potential growth of the issuer
of the securities. We often blend both approaches in making our selections. In
determining which securities to sell, we select securities which we believe will
not yield performance we seek based primarily upon the foregoing criteria.
We may, from time to time, take temporary defensive positions that are
inconsistent with our principal investment strategies in attempting to respond
to adverse market, economic, political, or other conditions. During any time
that we take a defensive position, we may not achieve our investment objective.
Although we normally invest according to our investment strategy, we may invest
without limitation in preferred stocks and investment-grade debt instruments for
temporary, defensive purposes.
The value of our investments varies in response to many factors. Stock values
fluctuate in response to the activities of individual companies and general
market and economic conditions. Although we may use various investment
techniques to hedge a portion of our risks, we cannot assure you that these
techniques will work as we intend. When you sell or redeem your shares, they may
be worth more or less than what you paid for them.
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand our financial
performance for the period of our operations. 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 Fund (assuming reinvestment of all dividends and distributions). This
information has been audited by Mathieson Aitken Jemison, LLP, whose report,
along with our financial statements, are included in our annual report, which is
available upon request.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
1999 1998 1997 1996 1995
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $0.93 $0.83 $0.76 $0.63 $1.19
- ----------------------------------------------------------------------------------------------------------------------------------
Income from investment operations
- ----------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) (0.04) (0.04) (0.03) (0.02) 0.06
- ----------------------------------------------------------------------------------------------------------------------------------
Net gains or (losses) on securities (both
- ----------------------------------------------------------------------------------------------------------------------------------
realized and unrealized) (0.61) 0.14 0.10 0.15 (0.48)
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total from investment operations (0.65) 0.10 0.07 0.13 (0.42)
- ----------------------------------------------------------------------------------------------------------------------------------
Less distributions
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends (from net investment income) 0.07
- ----------------------------------------------------------------------------------------------------------------------------------
Distributions (from capital gains)
- ----------------------------------------------------------------------------------------------------------------------------------
Returns of capital 0.07
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total distributions 0.14
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $0.28 $0.93 $0.83 $0.76 $0.63
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total return (69.89)% 12.05% 9.21% 20.63% (38.37)%
- ----------------------------------------------------------------------------------------------------------------------------------
Ratio/Supplemental data
- ----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period $4,348,413 $16,890,738 $18,126,591 $21,429,753 $30,779,569
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to average net assets 8.88% 5.85% 6.42% 6.25% 3.69%
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Ratio of net income (loss) to
- ----------------------------------------------------------------------------------------------------------------------------------
average net assets -8.67% -4.08% -4.97% -3.53% 6.55%
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 1528% 1180% 470% 606% 620%
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
MANAGEMENT'S DISCUSSION OF OUR PERFORMANCE
During our fiscal year ended May 31, 1999, the factors that materially affected
our performance were the significant decline in market value of our largest
holding, a speculative security of a foreign issuer, and losses sustained from
extensive, active and frequent short term trading.
<TABLE>
<CAPTION>
Date AHERX AHERX AHERX $10,000 buys Mkt. Value SPX SPX $10,000 invst
1984 Month End Price Dividend Reinvest shares Index dividends gives
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Jan-86 2.41 211.78 0.68
Feb-86 2.46 226.92 0.69
Mar-86 2.50 238.9 0.68
Apr-86 2.33 235.52 0.69
May-86 2.16 4629.63 10,000 247.35 0.7 40.42854255
Jun-86 2.04 4629.63 9,444 250.84 0.69 40.53975167
Jul-86 1.85 4629.63 8,565 236.12 0.69 40.65821867
Aug-86 1.88 4629.63 8,704 252.93 0.7 40.7707429
Sep-86 1.86 4629.63 8,611 231.32 0.7 40.89411969
Oct-86 1.86 4629.63 8,611 243.98 0.68 41.00809625
Nov-86 1.85 4629.63 8,565 249.22 0.69 41.12163283
Dec-86 1.42 0.36 1.49 5750.68 8,166 242.17 0.69 41.23879816
Jan-87 1.56 5750.68 8,971 274.08 0.7 41.344122
Feb-87 1.70 5750.68 9,776 284.2 0.71 41.44740957
Mar-87 1.70 5750.68 9,776 291.7 0.7 41.54687198
Apr-87 1.62 5750.68 9,316 288.36 0.75 41.65493189
May-88 1.14 8771.93 10,000 10263.16 262.16 1.399 38.14464449
Jun-88 1.17 8771.93 10,263 273.5 0.682 38.23976203
Jul-88 1.09 8771.93 9,561 272.02 0.438 38.30133477
Aug-88 1.08 8771.93 9,474 261.52 1.278 38.48850633
Sep-88 1.11 8771.93 9,737 271.91 0.74 38.59325236
Oct-88 1.10 8771.93 9,649 278.97 0.506 38.66325339
Nov-88 1.06 8771.93 9,298 273.7 1.285 38.84477433
Dec-88 1.07 8771.93 9,386 277.72 0.751 38.94981691
Jan-89 1.09 8771.93 9,561 297.47 0.53 39.01921349
Feb-89 1.08 8771.93 9,474 288.86 1.216 39.18347079
Mar-89 1.08 8771.93 9,474 294.87 0.721 39.27928007
Apr-89 1.11 8771.93 9,737 309.64 0.524 39.34575192
1 May-89 1.14 8771.93 10,000 319.05 1.601 31.34304968
2 Jun-89 1.12 8771.93 9,825 317.98 0.736 31.41559665
3 Jul-89 1.15 8771.93 10,088 346.08 0.585 31.46870033
4 Aug-89 1.16 8771.93 10,175 351.45 1.373 31.59163823
5 Sep-89 1.13 8771.93 9,912 349.15 0.869 31.67026671
6 Oct-89 1.06 8771.93 9,298 340.36 0.693 31.73474989
7 Nov-89 1.05 8771.93 9,211 345.99 1.283 31.85242868
8 Dec-89 1.04 8771.93 9,123 353.4 0.887 31.93237521
9 Jan-90 1.02 8771.93 8,947 329.08 0.608 31.99137267
10 Feb-90 1.02 8771.93 8,947 331.89 1.46 32.13210425
11 Mar-90 1.02 8771.93 8,947 339.94 0.738 32.20186213
12 Apr-90 1.00 8771.93 8,772 330.8 0.672 32.26727825
13 May-90 1.03 8771.93 9,035 361.23 1.754 32.42395628
14 Jun-90 1.04 8771.93 9,123 358.02 0.775 32.49414389
15 Jul-90 0.97 8771.93 8,509 356.15 0.726 32.56038212
16 Aug-90 0.83 8771.93 7,281 322.56 1.437 32.70543814
17 Sep-90 0.74 8771.93 6,491 306.05 0.835 32.79466879
18 Oct-90 0.70 8771.93 6,140 304 0.756 32.87622396
19 Nov-90 0.70 8771.93 6,140 322.22 1.392 33.01825022
20 Dec-90 0.72 8771.93 6,316 330.22 0.971 33.1153392
21 Jan-91 0.73 8771.93 6,404 343.93 0.635 33.17648024
22 Feb-91 0.98 8771.93 8,596 367.07 1.426 33.30536482
23 Mar-91 1.11 8771.93 9,737 375.22 0.73 33.37016125
24 Apr-91 1.07 8771.93 9,386 375.34 0.762 33.43790799
25 May-91 1.11 8771.93 9,737 389.83 1.657 33.58003819
26 Jun-91 1.10 8771.93 9,649 371.16 0.824 33.65458811
27 Jul-91 1.16 8771.93 10,175 387.81 0.635 33.70969413
28 Aug-91 1.24 8771.93 10,877 395.43 1.541 33.8410616
29 Sep-91 1.24 8771.93 10,877 387.86 0.95 33.92394978
30 Oct-91 1.33 8771.93 11,667 392.45 0.603 33.97607398
31 Nov-91 1.31 8771.93 11,491 375.22 1.47 34.1091821
32 Dec-91 1.02 0.38 0.98 12207.30 12,451 417.09 0.97 34.18850768
33 Jan-92 1.14 12207.30 13,916 408.78 0.537 34.23341992
34 Feb-92 1.21 12207.30 14,771 412.7 1.382 34.34805667
35 Mar-92 1.20 12207.30 14,649 403.69 0.993 34.43254631
36 Apr-92 1.16 12207.30 14,160 414.95 0.577 34.48042576
37 May-92 1.15 12207.30 14,038 415.35 1.629 34.61565777
38 Jun-92 1.12 12207.30 13,672 408.14 1.033 34.7032698
39 Jul-92 1.10 12207.30 13,428 424.22 0.59 34.75153468
40 Aug-92 1.04 12207.30 12,696 414.03 1.514 34.878612
41 Sep-92 1.04 12207.30 12,696 417.8 1.097 34.97019132
42 Oct-92 1.11 12207.30 13,550 418.68 0.554 35.01646409
43 Nov-92 1.17 12207.30 14,283 431.35 1.547 35.14204766
44 Dec-92 1.13 0.08 1.05 13142.03 14,850 435.71 0.932 35.21721781
45 Jan-93 1.13 13142.03 14,850 438.78 0.57 35.26296697
46 Feb-93 1.24 13142.03 16,296 443.38 1.378 35.37256228
47 Mar-93 1.34 13142.03 17,610 451.67 1.059 35.45549792
48 Apr-93 1.28 13142.03 16,822 440.19 0.563 35.50084526
49 May-93 1.42 13142.03 18,662 450.19 1.741 35.63813612
50 Jun-93 1.47 13142.03 19,319 450.53 0.975 35.71526125
51 Jul-93 1.45 13142.03 19,056 448.13 0.586 35.76196453
52 Aug-93 1.52 13142.03 19,976 463.56 1.536 35.88046133
53 Sep-93 1.54 13142.03 20,239 458.93 1.075 35.96450791
54 Oct-93 1.62 13142.03 21,290 467.83 0.587 36.00963363
55 Nov-93 1.57 13142.03 20,633 461.79 1.601 36.13447701
56 Dec-93 1.53 0.07 1.49 13723.28 20,997 466.45 0.923 36.20597904
57 Jan-94 1.52 13723.28 20,859 481.61 0.683 36.25732491
58 Feb-94 1.40 13723.28 19,213 467.14 1.41 36.36676283
59 Mar-94 1.26 13723.28 17,291 445.76 1.043 36.45185465
60 Apr-94 1.22 13723.28 16,742 450.91 0.571 36.49801466
61 May-94 1.19 13723.28 16,331 456.51 1.781 36.64040577
62 Jun-94 1.09 13723.28 14,958 444.27 1.06 36.72782745
63 Jul-94 1.08 13723.28 14,821 458.26 0.588 36.77495345
64 Aug-94 1.08 13723.28 14,821 475.5 1.516 36.8922002
65 Sep-94 1.08 13723.28 14,821 462.71 1.182 36.98644191
66 Oct-94 1.04 13723.28 14,272 472.35 0.721 37.0428984
67 Nov-94 1.02 13723.28 13,998 453.69 1.482 37.1639008
68 Dec-94 0.85 0.14 0.84 15974.55 13,578 459.27 1.136 37.25582535
69 Jan-95 0.84 15974.55 13,419 470.42 0.752 37.31538145
70 Feb-95 0.81 15974.55 12,939 487.39 1.345 37.41835687
71 Mar-95 0.76 15974.55 12,141 500.71 1.039 37.49600196
72 Apr-95 0.71 15974.55 11,342 514.71 0.735 37.54954582
73 May-95 0.63 15974.55 10,064 533.4 1.841 37.67914596
74 Jun-95 0.65 15974.55 10,383 544.75 1.03 37.75038877
75 Jul-95 0.67 15974.55 10,703 562.06 0.745 37.8004262
76 Aug-95 0.65 15974.55 10,383 561.88 1.587 37.90719148
77 Sep-95 0.67 15974.55 10,703 584.41 1.17 37.98308241
78 Oct-95 0.63 15974.55 10,064 581.5 0.823 38.03684006
79 Nov-95 0.61 15974.55 9,744 605.37 1.632 38.13938251
80 Dec-95 0.59 15974.55 9,425 615.93 1.101 38.20755821
81 Jan-96 0.64 15974.55 10,224 636.02 0.849 38.2585601
82 Feb-96 0.69 15974.55 11,022 640.43 1.503 38.34834761
83 Mar-96 0.71 15974.55 11,342 645.5 1.098 38.41357841
84 Apr-96 0.76 15974.55 12,141 654.17 0.837 38.46272797
85 May-96 0.76 15974.55 12,141 669.12 1.894 38.57159993
86 Jun-96 0.69 15974.55 11,022 670.63 1.04 38.63141602
87 Jul-96 0.61 15974.55 9,744 639.95 1.067 38.69582687
88 Aug-96 0.62 15974.55 9,904 651.99 1.478 38.78354667
89 Sep-96 0.59 15974.55 9,425 687.31 1.344 38.85938593
90 Oct-96 0.59 15974.55 9,425 705.27 0.99 38.91393354
91 Nov-96 0.56 15974.55 8,946 757.02 1.512 38.99165655
92 Dec-96 0.56 15974.55 8,946 740.74 1.284 39.05924475
93 Jan-97 0.73 15974.55 11,661 786.16 0.832 39.10058149
94 Feb-97 0.79 15974.55 12,620 790.82 1.511 39.17528999
95 Mar-97 0.83 15974.55 13,259 757.12 1.269 39.24095124
96 Apr-97 0.83 15974.55 13,259 801.34 0.94 39.28698226
97 May-97 0.83 15974.55 13,259 848.28 1.816 39.37108793
98 Jun-97 1.00 15974.55 15,975 885.14 1.123 39.42103905
99 Jul-97 1.07 15974.55 17,093 954.29 1.259 39.47304744
100 Aug-97 1.09 15974.55 17,412 899.47 1.399 39.53444225
101 Sep-97 1.04 15974.55 16,614 947.28 1.422 39.59378899
102 Oct-97 0.99 15974.55 15,815 914.62 1.061 39.63971955
103 Nov-97 0.91 15974.55 14,537 955.4 1.524 39.70295059
104 Dec-97 0.98 15974.55 15,655 970.43 1.366 39.75883739
105 Jan-98 0.85 15974.55 13,578 980.28 0.872 39.79420454
106 Feb-98 0.81 15974.55 12,939 1049.34 1.602 39.85495731
107 Mar-98 0.79 15974.55 12,620 1101.75 1.283 39.90136885
108 Apr-98 0.83 15974.55 13,259 1111.75 1.08 39.94013069
109 May-98 0.93 15974.55 14,856 1090.82 1.846 40.00772157
110 Jun-98 0.76 15974.55 12,141 1133.84 1.254 40.05196915
111 Jul-98 0.85 15974.55 13,578 1120.67 1.127 40.09224735
112 Aug-98 0.49 15974.55 7,828 957.28 1.529 40.15628405
113 Sep-98 0.50 15974.55 7,987 1017.01 1.6 40.21945949
114 Oct-98 0.48 15974.55 7,668 1098.67 0.991 40.25573743
115 Nov-98 0.44 15974.55 7,029 1163.63 1.601 40.31112396
116 Dec-98 0.38 15974.55 6,070 1229.23 1.411 40.35739602
117 Jan-99 0.33 15974.55 5,272 1279.64 0.973 40.38808257
118 Feb-99 0.34 15974.55 5,431 1238.33 1.548 40.43857053
119 Mar-99 0.32 15974.55 5,112 1286.37 1.491 40.48544189
120 Apr-99 0.29 15974.55 4,633 1335.18 1.006 40.51594591
121 May-99 0.28 15974.55 4,473 1301.84 1.855 40.57367733
Jun-99 0.26 15974.55 4,153 1372.71 1.321 40.6127226
Jul-99 0.25 15974.55 3,994 1328.72 1.169 40.64845343
Aug-99 0.21 15974.55 3,355 1320.41 1.692 40.70054118
Sep-99
Oct-99
Nov-99
Dec-99
</TABLE>
<TABLE>
<CAPTION>
Since End May 89 Annual
Mkt. Value to End May 99 Changes
AT end of month Date AHF AHF SPX
<S> <C> <C> <C> <C> <C>
Jan-86
Feb-86
Mar-86
Apr-86
10,000 May-31-1986
10,169 Jun-86
9,600 Jul-86
10,312 Aug-86
9,460 Sep-86
10,005 Oct-86
10,248 Nov-86
9,987 Dec-86
11,332 Jan-87
11,779 Feb-87
12,119 Mar-87
12,012 Apr-87
10,000 May-88
10,459 Jun-88
10,419 Jul-88
10,066 Aug-88
10,494 Sep-88
10,786 Oct-88
10,632 Nov-88
10,817 Dec-88
11,607 Jan-89
11,319 Feb-89
11,582 Mar-89
12,183 Apr-89
10,000 May-89 $10,000 $10,000
9,990 Jun-89 $9,825 $9,990
10,891 Jul-89 $10,088 $10,891
11,103 Aug-89 $10,175 $11,103
11,058 Sep-89 $9,912 $11,058
10,801 Oct-89 $9,298 $10,801
11,021 Nov-89 $9,211 $11,021
11,285 Dec-89 $9,123 #DIV/0! $11,285 #DIV/0!
10,528 Jan-90 $8,947 $10,528
10,664 Feb-90 $8,947 $10,664
10,947 Mar-90 $8,947 $10,947
10,674 Apr-90 $8,772 $10,674
11,713 May-90 $9,035 $11,713
11,634 Jun-90 $9,123 $11,634
11,596 Jul-90 $8,509 $11,596
10,549 Aug-90 $7,281 $10,549
10,037 Sep-90 $6,491 $10,037
9,994 Oct-90 $6,140 $9,994
10,639 Nov-90 $6,140 $10,639
10,935 Dec-90 $6,316 -30.77% $10,935 -3.10%
11,410 Jan-91 $6,404 $11,410
12,225 Feb-91 $8,596 $12,225
12,521 Mar-91 $9,737 $12,521
12,551 Apr-91 $9,386 $12,551
13,091 May-91 $9,737 $13,091
12,491 Jun-91 $9,649 $12,491
13,073 Jul-91 $10,175 $13,073
13,382 Aug-91 $10,877 $13,382
13,158 Sep-91 $10,877 $13,158
13,334 Oct-91 $11,667 $13,334
12,798 Nov-91 $11,491 $12,798
14,260 Dec-91 $12,451 97.15% $14,260 30.40%
13,994 Jan-92 $13,916 $13,994
14,175 Feb-92 $14,771 $14,175
13,900 Mar-92 $14,649 $13,900
14,308 Apr-92 $14,160 $14,308
14,378 May-92 $14,038 $14,378
14,164 Jun-92 $13,672 $14,164
14,742 Jul-92 $13,428 $14,742
14,441 Aug-92 $12,696 $14,441
14,611 Sep-92 $12,696 $14,611
14,661 Oct-92 $13,550 $14,661
15,159 Nov-92 $14,283 $15,159
15,344 Dec-92 $14,850 19.27% $15,344 7.61%
15,473 Jan-93 $14,850 $15,473
15,683 Feb-93 $16,296 $15,683
16,014 Mar-93 $17,610 $16,014
15,627 Apr-93 $16,822 $15,627
16,044 May-93 $18,662 $16,044
16,091 Jun-93 $19,319 $16,091
16,026 Jul-93 $19,056 $16,026
16,633 Aug-93 $19,976 $16,633
16,505 Sep-93 $20,239 $16,505
16,846 Oct-93 $21,290 $16,846
16,687 Nov-93 $20,633 $16,687
16,888 Dec-93 $20,997 41.39% $16,888 10.06%
17,462 Jan-94 $20,859 $17,462
16,988 Feb-94 $19,213 $16,988
16,249 Mar-94 $17,291 $16,249
16,457 Apr-94 $16,742 $16,457
16,727 May-94 $16,331 $16,727
16,317 Jun-94 $14,958 $16,317
16,852 Jul-94 $14,821 $16,852
17,542 Aug-94 $14,821 $17,542
17,114 Sep-94 $14,821 $17,114
17,497 Oct-94 $14,272 $17,497
16,861 Nov-94 $13,998 $16,861
17,110 Dec-94 $13,578 -35.33% $17,110 1.32%
17,554 Jan-95 $13,419 $17,554
18,237 Feb-95 $12,939 $18,237
18,775 Mar-95 $12,141 $18,775
19,327 Apr-95 $11,342 $19,327
20,098 May-95 $10,064 $20,098
20,565 Jun-95 $10,383 $20,565
21,246 Jul-95 $10,703 $21,246
21,299 Aug-95 $10,383 $21,299
22,198 Sep-95 $10,703 $22,198
22,118 Oct-95 $10,064 $22,118
23,088 Nov-95 $9,744 $23,088
23,533 Dec-95 $9,425 -30.59% $23,533 37.54%
24,333 Jan-96 $10,224 $24,333
24,559 Feb-96 $11,022 $24,559
24,796 Mar-96 $11,342 $24,796
25,161 Apr-96 $12,141 $25,161
25,809 May-96 $12,141 $25,809
25,907 Jun-96 $11,022 $25,907
24,763 Jul-96 $9,744 $24,763
25,286 Aug-96 $9,904 $25,286
26,708 Sep-96 $9,425 $26,708
27,445 Oct-96 $9,425 $27,445
29,517 Nov-96 $8,946 $29,517
28,933 Dec-96 $8,946 -5.08% $28,933 22.94%
30,739 Jan-97 $11,661 $30,739
30,981 Feb-97 $12,620 $30,981
29,710 Mar-97 $13,259 $29,710
31,482 Apr-97 $13,259 $31,482
33,398 May-97 $13,259 $33,398
34,893 Jun-97 $15,975 $34,893
37,669 Jul-97 $17,093 $37,669
35,560 Aug-97 $17,412 $35,560
37,506 Sep-97 $16,614 $37,506
36,255 Oct-97 $15,815 $36,255
37,932 Nov-97 $14,537 $37,932
38,583 Dec-97 $15,655 75.00% $38,583 33.35%
39,009 Jan-98 $13,578 $39,009
41,821 Feb-98 $12,939 $41,821
43,961 Mar-98 $12,620 $43,961
44,403 Apr-98 $13,259 $44,403
43,641 May-98 $14,856 $43,641
45,413 Jun-98 $12,141 $45,413
44,930 Jul-98 $13,578 $44,930
38,441 Aug-98 $7,828 $38,441
40,904 Sep-98 $7,987 $40,904
44,228 Oct-98 $7,668 $44,228
46,907 Nov-98 $7,029 $46,907
49,609 Dec-98 $6,070 -61.22% $49,609 28.58%
51,682 Jan-99 $5,272 $51,682
50,076 Feb-99 $5,431 $50,076
52,079 Mar-99 $5,112 $52,079
54,096 Apr-99 $4,633 $54,096
52,820 May-99 $4,473 $52,820
55,749 Jun-99 $4,153 $55,749
54,010 Jul-99 $3,994 $54,010
53,741 Aug-99 $3,355 $53,741
Sep-99 $0 $0
Oct-99 $0 $0
Nov-99 $0 $0
Dec-99 $0 $0
</TABLE>
10
<PAGE> 13
Past performance does not predict future performance.
MANAGEMENT
American Heritage Management Corporation (AHMC ), 1370 Avenue of the Americas,
New York, New York 10019 has been our investment adviser since 1990. AHMC
provides continuous investment advice to us and places orders for purchases and
sales of our securities. AHMC also provides investment advice to American
Heritage Growth Fund, Inc
We make our investment decisions based upon advice furnished to us by AHMC.
For the fiscal year ended May 31, 1999, the investment advisory fee represented
1.25% of our average net assets.
Heiko H. Thieme is our portfolio manager and has been primarily responsible for
the day-to-day management of our portfolio since February 1990. Mr. Thieme also
renders investment advice to one other U.S. and two foreign investment companies
and is the Chief Executive Officer of a securities broker-dealer.
We and AHMC have adopted Codes of Ethics governing personal securities
transactions. Under the Codes, our personnel and personnel of AHMC may purchase
and sell securities (including securities held by us) subject to certain
reporting requirements and other procedures.
PRICING OF SHARES
The price at which you buy and redeem our shares is the net asset value (NAV)
per share. The NAV represents the value of our total assets less our
liabilities. The NAV per share is generally calculated as of the close of the
regular trading session of the New York Stock Exchange. Our shares will not be
priced on the days when the New York Stock Exchange is closed for trading such
as weekends and certain national holidays. In calculating the NAV, portfolio
securities will be valued at market value when there is a reliable quotation
available for the securities. The value of all other assets will be determined
by our Board of Directors or members of a committee of our Board of Directors at
amounts which they think represent their fair value.
PROCEDURES FOR BUYING FUND SHARES
The minimum investment requirements for the Fund are:
Opening the Account Adding to the Account
------------------- ---------------------
Regular Accounts $1,000 $500
IRAs, Custodian Accounts
11
<PAGE> 14
and Keogh Accounts 500 500
We may change these minimum investment amounts at any time and we can refuse any
purchase order that might adversely affect our operations.
Once we accept your order to purchase, the purchase price will be the next
calculated NAV per share. You pay no sales load for buying Fund shares.
You may buy Fund shares in any of these ways:
BY TELEPHONE
Call 1-800-828-5050 to buy shares of the Fund. We must receive your payment
within three business days of your order. To meet this deadline, you may send a
check by overnight mail or wire payment, or you may make an electronic transfer
through your bank.
BY MAIL
Mail your application and check to:
The American Heritage Fund, Inc.
Location 0637
Cincinnati, OH 45264-0637
If you purchase additional shares of the Fund, you must send a completed
investment slip together with a check that has your account number on it.
THROUGH CERTAIN BROKER-DEALERS
Shares of the Fund may be purchased through certain registered broker-dealers.
We impose no sales load or service charge, but the broker-dealers may make a
charge to investors for their services. The charge and services may vary in
amount among broker-dealers, some of which may impose higher initial or
subsequent investment requirements than those established by us.
BY COURIER
Deliver your application and check to:
The American Heritage Fund, Inc.
c/o Firstar Bank, N.A.
425 Walnut Street
Mutual Fund Custodian Department
Cincinnati, OH 45202
12
<PAGE> 15
If you purchase additional shares of the Fund, you must send a completed
investment slip together with a check that has your account number on it.
PROCEDURES FOR REDEEMING FUND SHARES
Any shareholder may redeem his or her shares by making a written request
directly to our Transfer Agent, American Data Services, Inc., 150 Motor Parkway,
Suite 109, Hauppauge, New York 11788. Redemptions may be made by telephone upon
the request of certain financial institutions who are holders of record of
shares issued by the Fund, within our sole discretion. We have instructed our
Transfer Agent to confirm the authenticity of any such request for redemption by
telecopier and telephone. Proceeds of redemptions made by telephone will be sent
only to the respective financial institution making the request. In the event
that a telephone redemption which is honored by us is unauthorized or
fraudulent, we could sustain losses.
The redemption price will be the NAV per share next determined by us following
receipt of a proper request for redemption. There is no redemption charge
imposed by us. We intend to make payment for shares redeemed in cash to the
extent that we are reasonably able to do so although we reserve the right to
make payment in kind.
Payment for shares redeemed will normally be made within seven days after
receipt of a proper written request. Payment will not be mailed before clearance
of the purchaser's check. The determination of the NAV and the right of
redemption may be suspended or the payment date postponed when: (a) trading on
the New York Stock Exchange is restricted as determined by the Securities and
Exchange Commission or the Exchange is closed for other than customary weekend
and holiday closings; (b) when an emergency exists, as determined by the
Securities and Exchange Commission, as a result of which disposal by us of
securities owned by us is not reasonably practicable, or it is not reasonably
practicable for us to fairly determine the value of our net assets; or (c) when
the Securities and Exchange Commission by Order so permits for the protection of
our shareholders.
All requests for redemption of shares must be signed by all registered owners
exactly as registered, including fiduciary titles, if any, with signatures
guaranteed by a member of a national securities exchange or a United States
commercial bank or a foreign bank having a New York City correspondent.
DISTRIBUTIONS AND TAXES
We intend to distribute as dividends our net investment income, if any, and
distribute any net capital gains that we realize once a year. Your distributions
will be reinvested in the Fund unless you instruct us otherwise in writing.
There are no fees or sales charges on reinvestments. Dividends and distributions
are taxable to most investors (unless your investment is in an IRA or other
tax-advantaged account). The tax status of any distribution is the same
regardless of how
13
<PAGE> 16
long you have been in the Fund and whether you reinvest your distributions or
take them in cash.
The tax status of your dividends and distributions will be detailed in your
annual tax statement from the Fund. Because everyone's tax situation is unique,
always consult your tax professional about federal, state and local tax
consequences.
Except in tax-advantaged accounts, any redemption, sale or exchange of Fund
shares may generate a tax liability.
SHAREHOLDER SERVICES
We offer the following shareholder services. For further details, please write
or call us.
EXCHANGE PRIVILEGE
A shareholder of the Fund has the privilege of exchanging shares of the Fund for
shares of American Heritage Growth Fund, Inc. (AHGF) by written notice to our
Transfer Agent subject to the following:
- Shares of AHGF must be eligible for sale in the state of
residence of the shareholder.
- Shareholders may only exchange between accounts that are
registered in the same name, address, and have the same
taxpayer identification number.
- A shareholder must have received a current Prospectus of AHGF
before the exchange.
- Both the Fund and AHGF reserve the right to temporarily or
permanently terminate the exchange privilege.
Exchanges may have tax consequences and you may wish to consult with your tax
advisor before making any exchange.
AUTOMATIC WITHDRAWAL PLAN
With an Automatic Withdrawal Plan, a shareholder can arrange for automatic
distributions to be made monthly or quarterly in amounts not less than $1,000.
An Automatic Withdrawal Plan may neither be opened nor maintained by a
shareholder holding shares of the Fund having a value of less than $50,000.
IRA AND KEOGH PLANS
14
<PAGE> 17
A prototype defined contribution retirement plan and individual retirement
account is available. Charges are imposed by Firstar Bank, N.A. and American
Data Services, Inc. and shareholders should carefully review all documents
provided in connection with a plan or account.
LEGAL PROCEEDINGS
On October 5, 1994, one of our shareholders on behalf of himself and a purported
class of others brought an action against the us, AHMC, Heiko H. Thieme and
Richard K. Parker in the United States District Court for the Southern District
of New York. The Complaint, as amended, alleges that certain of our registration
statements and prospectuses failed to disclose certain risks regarding our
investments in illiquid securities and that we invested in illiquid securities
in concentrations which exceeded the our own investment restrictions and that we
improperly valued our illiquid securities. The amended Complaint also alleges
that the other defendants breached their fiduciary duties in connection with our
investments in and valuation of illiquid securities and by the receipt of AHMC
of substantial compensation for investment advice and that we breached our own
limitations with respect to illiquid securities and that we changed investment
policies without obtaining a shareholder vote. The Plaintiff is seeking
rescission or compensatory damages and pre-judgment interest and the costs and
expense of the litigation and such other and further relief as the Court may
deem just and proper
The Plaintiff made a motion to permit the action to proceed as a class action
and in which the Plaintiff would serve as the sole class representative of all
persons who acquired shares of the Fund from July 1, 1993 through August 31,
1994. On August 1, 1997, the Court denied the Plaintiff's Motion. If the
Plaintiff were to appeal the Court's denial and if he were to prevail on the
appeal as well as the merits of his case, our potential loss could be as much as
$25 million which is substantially more than our assets.
After conferring with our special counsel, we concluded that the substantive
allegations of the amended compliant are without merit. Although there can be no
assurance of the outcome of the action, based upon the our belief, we have not
established a reserve for potential losses other than the expense of our
defense. We have vigorously defended the action and intend to continue to do so
if the Plaintiff proceeds. Our officers and directors are entitled to be
indemnified by us to the full extent permitted by law.
CUSTODIAN AND TRANSFER AGENT
Firstar Bank, N.A. 425 Walnut Street, Cincinnati, Ohio 45202 is the Custodian of
our portfolio securities and monies.
American Data Services, 150 Motor Parkway, Hauppauge, New York 11788 is our
Transfer Agent.
Neither the Custodian nor the Transfer Agent performs any managerial or
policy-making
15
<PAGE> 18
functions for us.
THE AMERICAN HERITAGE FUND, INC.
- --------------------------------------------------------------------------------
Mail to: The American Heritage Fund, Inc., Location 0637, Cincinnati, Ohio
45264-0637
(DO NOT USE THIS FORM FOR IRA PLANS. Please request separate forms)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Complete only the applicable sections which will tell us how your account should
be registered.
<TABLE>
<S> <C> <C>
ACCOUNT [ ] Individual
REGISTRATION
-----------------------------------------------------------------------------------
First Name Middle Name Last Name
[ ] Joint Tenant
-----------------------------------------------------------------------------------
First Name Middle Name Last Name
[ ] Gifts to Minors
------------------------------------ As Custodian For -----------------------------
Name of Custodian (only 1 permitted) Name of Minor (only 1 permitted)
UNDER THE -------------------------- UNIFORM GIFT TO MINORS
State
[ ]Corporations, ---------------------------------------------------------------
Trusts & Name of corporation or partnership. If a trust,
Others include the name(s) of trustees in which account will
be registered and the date of the trust investment. An
account for a pension or profit sharing plan or trust
may be registered in the name of the plan or trust
itself.
- -----------------------------------------------------------------------------------------------------
ADDRESS
---------------------------------------------------------------
Street
( )
---------------------------------------------------------------
City Home Phone Number
( )
---------------------------------------------------------------
State Zip Code Business Phone Number
- -----------------------------------------------------------------------------------------------------
INVESTMENT $ (Minimum initial $2,500 or, in the case of an IRA
--------------------- account, $2,000. Subsequent Investments of $250 or
more.) Make checks payable to The American Heritage
Fund, Inc. Application is not needed for subsequent
investments.
- -----------------------------------------------------------------------------------------------------
DISTRIBUTIONS Reinvest all income and capital gain distributions in additional shares of the
Fund unless this box is checked.
[ ] Pay dividends and capital gain distributions in cash. If any dividend or
capital gain distribution check addressed and sent to (me)(us) is returned to
you, you hereby are authorized to invest the proceeds of that check in Fund
shares at the net asset value next determined after receipt by you of the
returned check. In such event (I)(we) understand and agree that all subsequent
dividend and capital gain distributions automatically will be reinvested in
Fund shares unless and until (I)(we) have signed and filed with you a new
request to receive dividends and capital gain distributions in cash.
- -----------------------------------------------------------------------------------------------------
</TABLE>
TAX IDENTIFICATION CERTIFICATION
Because of important changes made to the Internal Revenue Code in 1983, we
must be certain that we have a record of your correct Social Security or
other Taxpayer Identification Number. If you have not certified that you
have provided us with the correct number, your account will be subject to
special Federal income tax withholding of 20% of dividends and other
payments. To avoid this, please fill in your Social Security or Taxpayer
Identification Number.
<TABLE>
<S> <C>
[ ][ ][ ][ ][ ][ ][ ][ ][ ]
------------------------------------------------- ---------------------------------
Social Security or Taxpayer Identification Number Citizenship--If other than U.S.A.
If appropriate, check one of the following boxes:
[ ] I have been notified by the IRS that I am subject to backup withholding
for failure to report all interest or dividends.
[ ] I do not have a Social Security Number or Taxpayer Identification
Number, but I have applied for or intend to apply for one. I understand
that if I do not provide this number within 60 days, the required 20%
withholding will begin.
[ ] I am exempt because I am a Non-Resident Alien (not a U.S. citizen or
U.S. resident), a foreign corporation, partnership, estate or trust,
and, as a result, I am not required to submit a number.
[ ] I am an exempt recipient (see explanation below)
If you are an exempt recipient, you must certify your Tax Identification
Number as well as your exempt status to prevent withholding. A partial
listing of exempt recipients follows. For further information, see Internal
Revenue Code Sec. 3452 or consult your tax advisor.
</TABLE>
<TABLE>
<S> <C>
- Retirement Plans - Common Trust Funds
- Corporations - Financial Institutions
- Colleges, Churches, Charitable Organizations - Registered Securities Dealers
- Agents, Fiduciaries, Middlemen
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
SIGNATURE I understand and agree that:
(1) This application is subject to your acceptance or
rejection.
(2) All shares will be purchased at the net asset value next
determined after receipt and acceptance.
(3) The Fund has the right to redeem shares held in my
account to reimburse the Fund for any loss it has sustained
if my check for the purchase of or subscription for the
Fund shares is dishonored, regardless of whether the
undersigned was already an existing shareholder at the
time of such purchase or subscription.
(4) Under penalties of perjury, I certify that the
information I have provided in this application under the
caption TAX IDENTIFICATION CERTIFICATION is true,
correct, and complete.
I acknowledge receipt of your Prospectus and I understand
that all of its terms and provisions are incorporated herein
by reference.
</TABLE>
X
- --------------------------------------------------------------------------------
Signature of Individual and Joint Tenant or Custodian, Corporate Officer or
Trustee.
- ------------------------------------------------ ------------------
Title of Corporate Officer or Trustee Date
WHERE DID YOU FIRST LEARN ABOUT THE AMERICAN HERITAGE FUND? ------------------
- --------------------------------------------------------------------------------
/00
16
<PAGE> 19
PROSPECTUS
THE AMERICAN HERITAGE FUND, INC.
Our Statement of Additional Information (SAI) includes additional information
about us. Additional information about our investments is available in our
annual and semi-annual reports to shareholders. The SAI and the annual and
semi-annual reports are available, without charge, upon request. You may call us
at 1-800-828-5050 to request the SAI; to request our annual report; to request
our semi-annual report; to request other information about us; and to make
shareholder inquiries.
The SAI, including the annual report, is incorporated by reference into this
prospectus.
Information about us, including the SAI, can be reviewed and copied at the
Securities and Exchange Commission's Public Reference Room in Washington, D.C.
Information on the operation of the public reference room may be obtained by
calling the Commission at 1-202-942-8090. Reports and other information about us
are available on the EDGAR database on the Commission's Internet site at
http:/www.sec.gov. Copies of this information may be obtained, after paying a
duplicating fee, by electronic request at the following E-mail address:
[email protected], or by writing to the Commission's Public Reference Section,
Washington, D.C. 20549-0102.
, 2000
Our Investment Company Act of 1940 file number is 811-601.
17
<PAGE> 20
PART B
18
<PAGE> 21
THE AMERICAN HERITAGE FUND, INC.
STATEMENT OF ADDITIONAL INFORMATION
This Statement of Additional Information, which is not a prospectus,
relates to the prospectus of The American Heritage Fund, Inc dated *_______*,
2000 as it may be revised from time to time. To obtain a free copy of the
prospectus, please write to us at 1370 Avenue of the Americas, New York, NY
10019 or call us at 1-800-828-5050.
Our most recent Annual Report and Semi-Annual Report to Shareholders
are separate documents supplied with this Statement of Additional Information
unless the information has been previously delivered in a shareholder report.
The shareholder reports are available, without charge, upon request by calling
us at 1-800-828-5050. The financial statements, accompanying notes and report of
independent auditors appearing in the Annual Report are incorporated by
reference into this Statement of Additional Information.
*_______*, 2000
B-1
<PAGE> 22
TABLE OF CONTENTS
<TABLE>
<S> <C>
Description of the Fund B-3
Certain Investments, Techniques and Risks B-3
Certain Investment Restrictions B-6
Management B-8
Brokerage Allocations and Other Practices B-10
Control Persons and Principal Holders of Securities B-12
Investment Advisory and Other Services B-14
Returns B-15
Custodian B-15
Independent Accountants B-15
Transfer Agent B-15
Information About the Fund B-16
Financial Statements B-16
</TABLE>
B-2
<PAGE> 23
DESCRIPTION OF THE FUND
The American Heritage Fund, Inc., a New York corporation organized on
December 28, 1951, is a non-diversified, open-end management investment company.
CERTAIN INVESTMENTS, TECHNIQUES AND RISKS
We may invest in convertible securities. Convertible securities may be
converted at either a stated price or stated rate into underlying shares of
common stock. Convertible securities have characteristics similar to both
fixed-income and equity securities. Convertible securities may be subordinate to
other similar but non-convertible securities of the same issuer, although
convertible bonds, as corporate debt obligations, enjoy seniority in right of
payment to all equity securities, and convertible preferred stock is senior to
common stock, of the same issuer. Because of the subordination feature, however,
convertible securities typically have lower ratings than similar non-convertible
securities.
Although to a lesser extent than with fixed-income securities, the
market value of convertible securities tends to decline as interest rates
increase and, conversely, tends to increase as interest rates decline. In
addition, because of the conversion feature, the market value of convertible
securities tends to vary with fluctuations in the market value of the underlying
common stock. A unique feature of convertible securities is that as the market
price of the underlying common stock declines, convertible securities tend to
trade increasingly on a yield basis, and so may not experience market value
declines to the same extent as the underlying common stock. When the market
price of the underlying common stock increases, the prices of the convertible
securities tend to rise as a reflection of the value of the underlying common
stock. While no securities investments are without risk, investments in
convertible securities generally entail less risk than investments in common
stock of the same issuer.
There can be no assurance of current income from convertible securities
because the issuers of the convertible securities may default on their
obligations. A convertible security, in addition to providing fixed income,
offers the potential for capital appreciation through the conversion feature,
which enables the holder to benefit from increases in the market price of the
underlying common stock. There can be no assurance of capital appreciation,
however, because securities prices fluctuate. Convertible securities generally
offer lower interest or dividend yields than non-convertible securities of
similar quality because of the potential for capital appreciation.
The Fund may purchase high yield debt securities which are not
investment grade, including securities referred to as "junk bonds." An economic
downturn or increase in interest rates is likely to have an adverse effect on
the high yield securities market. The widespread expansion of government,
consumer and corporate debt within the United States economy has made the
corporate sector, especially cyclically sensitive industries, more vulnerable to
economic downturns or increased interest rates. The prices of high yield
securities have been found to be less sensitive to interest rate changes than
are those of higher rated investments, but more
B-3
<PAGE> 24
sensitive to adverse economic changes or individual corporate developments.
During an economic downturn or substantial period of rising interest rates,
highly leveraged issuers may experience financial stress which would adversely
affect the ability to service their principal and interest payment obligations,
to meet projected business goals, and to obtain additional financing. In periods
of economic uncertainty and change, increased volatility of market prices of
high yield securities can be expected. To the extent that there is no
established retail secondary market, there may be thin trading of high yield
securities. In the absence of readily available market quotations, the valuation
of high yield securities held by the Fund will be determined by the Fund's Board
of Directors. The fulfillment of such responsibility may become difficult and
judgment will play a greater role in valuation because there may be less
reliable, objective data available.
The Fund may invest in securities issued by other investment companies
to the extent consistent with its investment objective. Under the Investment
Company Act of 1940 (the "1940 Act"), the Fund's investment in such securities,
subject to certain exceptions, currently is limited to (a) 3% of the total
voting stock of any one investment company, (b) 5% of the Fund's total assets
with respect to any one investment company and (c) 10% of the Fund's total
assets in the aggregate. Investments in the securities of other investment
companies may involve duplication of advisory fees and certain other expenses.
The Fund will place in a segregated account (not with the broker) cash
or United States Government securities equal to the difference between (a) the
market value of securities sold short at the time they were sold short, and (b)
any cash or United States Government securities required to be deposited as
collateral with the broker in connection with the short sale (not including the
proceeds from the short sale). In addition, until the Fund replaces the borrowed
securities, it must daily maintain the segregated account at such level that (1)
the amount deposited in it plus the amount deposited with the broker as
collateral will equal the current market value of the securities sold short, and
(2) the amount deposited in it plus the amount deposited with the broker as
collateral will not be less than the market value of the securities at the time
they were sold short. Deposits to the segregated account do not diminish the
risk of loss to the Fund with respect to short sales. The foregoing requirements
do not apply to securities sold short "against the box," which is a short sale
to the extent that the Fund contemporaneously has or has the right to obtain at
no added cost securities identical to those sold short.
Generally, short sales will result in a gain if the price of the
securities declines between the date of the short sale and the date upon which
the securities are purchased to replace those borrowed; conversely, a loss will
result if the security increases in price during such period or if the security
becomes unavailable so that the Fund cannot cover its short position. The gain
is decreased and the loss is increased by the amount of any premium, dividends,
interest or brokerage commission the Fund may be required to pay with respect to
such short sale. Any income from short sales generally is, when distributed,
taxable to shareholders at ordinary income tax rates.
B-4
<PAGE> 25
The Fund may purchase and sell put and call options for purposes of
hedging or to seek capital growth. The Fund may hedge its investments by
combining puts and calls with other investment techniques. For example, the Fund
may sell short securities for which it holds a call or the Fund may purchase
securities for which it holds a put. Any puts and calls which the Fund purchases
will be listed for trading on one or more domestic securities exchanges. From
time to time, the Fund may obtain a put option from the seller of securities
purchased by the Fund or an affiliate of such seller in connection with a
purchase of securities by the Fund. Generally, no market will exist for any such
option. The Fund intends to purchase put and call options when Management
believes that such purchase will result in an opportunity for capital
appreciation based upon specific facts and circumstances A call option permits
the holder thereof to purchase the securities of an issuer at a predetermined
price. Call options can be expected to increase in value if the value of such
securities increases, and, conversely, call options can be expected to decrease
in value if the value of such securities decreases. A put option permits the
holder to sell the securities of an issuer at a predetermined price. Put
options, can be expected to increase in value if the value of such securities
decreases. Put and call options can be purchased and sold by the Fund without
limitation. In order for the Fund to realize a profit from purchase of a put
option, the value of the security underlying the option must decrease below the
exercise price of the option by an amount which is greater than the option
premium paid by the Fund plus transaction costs. In order for the Fund to
realize a profit from purchase of a call option, the value of the security
underlying such option must increase above the exercise price of the option by
an amount which is greater than the option premium paid by the Fund plus
transaction costs.
The Fund may write listed put and call options. The Fund will not write
a call option unless, at the time of the sale, the Fund:
(1) owns the securities (or securities convertible into the securities
without additional consideration) against which the call option is written and
will continue to own such securities during the time that the Fund is obligated
under the option; or
(2) purchases a call option on the same securities upon the same terms;
or
(3) establishes and maintains for the term of the option a segregated
account consisting of cash, U.S. Government securities or high-grade debt
securities, equal to the fluctuating market value of the optioned securities.
The account will be adjusted at least once daily to reflect changes in the
market value of the optioned securities.
The Fund will not write a put option unless, at the time of the sale,
the Fund:
(1) purchases a put option on the same securities upon the same terms;
or
(2) establishes a segregated account consisting of cash, U.S.
Government securities or high-grade debt securities equal to the option price,
i.e., the price at which the securities underlying the option may be sold to the
Fund; or
B-5
<PAGE> 26
(3) makes a corresponding short sale, although, if the short position
is closed out before the put option expires, then the requirements of (1) or (2)
above must be met.
The Fund anticipates that most of the options written by it will be for
a duration of not exceeding nine months. The Fund will not write any options
with respect to which it is required to maintain a segregated account or make
any short sales (except short sales against the box) during any time that the
total of (a) the amount required to be deposited in any such segregated account,
and (b) the amount required to be deposited in a segregated account in
connection with any short sales made by the Fund, exceeds 35% of the value of
the Fund's net assets. All the options written by the Fund will be listed for
trading on one or more domestic securities exchanges. The writing of options by
the Fund may be deemed to be inconsistent with its investment objective.
CERTAIN INVESTMENT RESTRICTIONS
The Fund's investment objective is a fundamental policy. Fundamental
policies cannot be changed without approval by the holders of the lesser of (a)
67% or more of the voting securities of the Fund present at a meeting, if the
holders of more than 50% of the outstanding securities of the Fund are present
or represented by proxy, or (b) more than 50% of the outstanding voting
securities of the Fund. In addition, the Fund has adopted investment
restrictions numbered 1 through 18 as fundamental policies. The other investment
restrictions are not fundamental policies and may be changed by the Fund without
shareholder approval. The Fund may not:
1. Issue any of its securities (a) for services, or (b) for property other
than cash or securities (including securities of which the Fund is the
issuer), except as a dividend or distribution to its security holders
or in connection with a reorganization;
2. Issue senior securities, except that the Fund may borrow from any bank;
3. Invest in companies for the purpose of exercising control or
management;
4. Purchase or sell commodities or commodity contracts, including futures
contracts;
5. Borrow money in excess of 33-1/3% of the value of the Fund's assets
(including the amount of the borrowing), less its liabilities (not
including any borrowings, but including the fair market value at the
time of computation of any securities with respect to which there are
open short positions);.
B-6
<PAGE> 27
6. Loan money to other persons, except that the Fund may (a) invest up to
15% of the value of its total assets in debentures, bonds or similar
governmental or corporate obligations of types commonly distributed
publicly or privately to financial institutions and (b) purchase debt
securities which are convertible into equity securities of an issuer
without regard to whether the securities are types commonly distributed
publicly or privately to financial institutions.
7. Invest in oil, gas and other mineral leases, but the Fund shall not be
prohibited from investing in marketable securities of companies
investing in such leases;
8. Invest in real estate or real estate mortgage loans, but the Fund shall
not be prohibited from investing in marketable securities of companies
engaged in real estate activities or investments.
9. Effect a short sale transaction which will, at the time of making and
after giving effect to the sale, cause the aggregate dollar amount of
the total deposits and deferred charges on short sales to exceed 35% of
the value of the Fund's net assets;
10. Invest in restricted and other illiquid securities if, as a result of
such investment, the value of the Fund's illiquid assets would exceed
15% of the value of the Fund's net assets. Restricted securities
eligible for resale under Rule 144A under the Securities Act of 1933
that have been determined to be liquid by the Fund's Board of Directors
based upon trading markets for the securities and any other restricted
securities that become registered under the Securities Act of 1933 or
that may be otherwise freely sold without registration thereunder are
not subject to the foregoing limitation, unless they are otherwise
illiquid.
11. Underwrite securities of other issuers or participate in any
underwriting or selling group in connection with the public
distribution of other's securities except that it may acquire
restricted securities;
12. Invest more than 25% of the value of its total assets in securities of
companies engaged in a particular industry;
13. Invest more than 35% of the value of its total assets in securities
issued by foreign companies.
14. Acquire time deposits if more than 10% of the value of the Fund's net
assets will be invested in time deposits or the time deposits cannot be
liquidated within seven days.
15. Purchase securities (other than securities issued or guaranteed by
domestic or foreign governments or political subdivisions thereof) if,
as a result of such purchase, more than 5% of the value of the Fund's
total assets would be
B-7
<PAGE> 28
represented by issuers that, including predecessors, have then been in
continuous operation for less than three years.
16. Purchase securities of other investment companies unless purchased on
the open market without the payment of any fee or charge other than
regular brokerage commissions.
17. With respect to 50% of the value of the Fund's total assets, acquire
more than (a) 5% of the value of its total assets in the securities of
any one issuer (not including securities of the federal government or
any instrumentality thereof) and (b) 10% of the outstanding voting
securities of any one issuer.
18. Invest more than 5% of the value of its assets in debt securities which
are not "investment grade" or which are not convertible into equity
securities;
19. Invest more than 10% of the value of its net assets in warrants.
All of the foregoing percentages are applicable only at the time of investment.
A later increase or decrease in percentage resulting from a change in values or
net assets will not constitute a violation of any restriction.
MANAGEMENT
The Fund's Board of Directors is responsible for the management of the
Fund. The following table sets forth certain information with respect to each
member of the Fund's Board of Directors and each officer of the Fund. The Fund
does not have an advisory board.
B-8
<PAGE> 29
<TABLE>
<CAPTION>
Positions Held With Principal Occupation(s) During
Name and Address Age the Fund the Past Five Years
- ---------------- --- -------- -------------------
<S> <C> <C> <C>
Heiko H. Thieme* 56 Chairman of the Board of Chairman of the Board of Directors, Chief
1370 Avenue of the Directors, Chief Executive Executive Officer and Secretary of the
Americas Officer and Secretary Fund and American Heritage Growth Fund,
New York, NY Inc. Chief Executive Officer of American
Heritage Management Corporation and
Thieme Associates, Inc. (investment
advisor). Chief Executive Officer of
Thieme Securities, Inc. (broker-dealer)
and Thieme Consulting, Inc. Chief
Executive Officer of Thieme Funds
International (foreign investment
company) and The Global Opportunity Fund
Limited (foreign investment company) and
their respective investment advisors.
Stephen Swope 63 Director Mr. Swope has been retired for more than
75 Club Road five years.
Riverside, CT
Eugene Sarver 56 Director Sole proprietor of Sarver International
241 W. 97th St. (financial and economic consulting) and
New York, NY Associate of Intercap Investments, Inc.
since 1996. Prior to that time,
Associate Professor of Finance of Lubin
School of Business - Graduate Division,
Pace University.
</TABLE>
* An "interested person" as defined in the Investment Company Act of 1940.
Dr. Sarver and Mr. Thieme have served as members of the Board of
Directors since February 1990. Mr. Swope became a member of the Board of
Directors in November 1999. Each of the Fund's Directors is also a member of the
Board of Directors of American Heritage Growth
B-9
<PAGE> 30
Fund, Inc. (AHGF).
Thieme Consulting, Inc., which is wholly owned by Mr. Thieme, has
provided consulting services to companies whose securities are held by the Fund
for compensation. Similar arrangements may be made with other companies whose
securities may become held by the Fund.
During the fiscal year ended May 31, 1999, no compensation was paid by
the Fund to its officers. Each of the Fund's Directors who were not interested
persons of the Fund received compensation of $5,000.
From time to time, the Fund, American Heritage Management Corporation,
the Fund's investment advisor (AHMC), AHGF, two foreign investment companies and
other clients of affiliated persons of AHMC may hold securities issued by the
same company. When the Fund and those investors are engaged in the purchase or
sale of the same security, the prices and amounts will be allocated in a manner
considered by management to be fair to each of them.
BROKERAGE ALLOCATIONS AND OTHER PRACTICES
AHMC places orders with brokers and dealers for the purchase and sale
of securities for the Fund's portfolio. In performing this service, AHMC is
required to place orders with the primary objective of obtaining the most
favorable price and a reasonable execution for the Fund. Subject to this
consideration, the brokers selected include those that supplement AHMC's
research with statistical data, investment information, economic facts and
opinions or provide quotation services. Information so received is in addition
to and not in lieu of services required to be performed by AHMC and AHMC's fee
is not reduced as a consequence of the receipt of supplemental information. Such
information may be useful to AHMC in serving both the Fund and AHGF and,
conversely, supplemental information obtained by the placement of orders for
AHGF maybe useful to AHMC in carrying out its obligation to the Fund. Brokers
may also be selected based upon their sales of shares of the Fund. Normally,
over-the-counter transactions will be executed on a principal basis with a
broker-dealer who makes a market in or is otherwise a traditional source of the
security traded except in those cases in which the Fund can obtain a better
price or execution on an agency basis. Transactions executed on an agency basis
involve the payment of a brokerage commission.
Section 28(e) of the Securities Exchange Act of 1934 permits an
investment advisor, under certain circumstances, to cause an account to pay a
broker or dealer which supplies brokerage and research services a commission for
effecting a securities transaction in excess of the amount of the commission
another broker or dealer would have charged for effecting the transaction.
Brokerage and research services include (a) furnishing advice as to the value of
securities and the availability of securities or purchasers or sellers of
securities, (b) furnishing analyses and reports concerning issuers, industries,
securities, economic factors and trends, portfolio strategy and the performance
of accounts, and (c) effecting securities transactions and
B-10
<PAGE> 31
performing functions incidental thereto, such as clearance, settlement and
custody.
AHMC may cause the Fund to incur brokerage commissions in an amount
higher than the lowest available rate in return for such services. Research
services so received by AHMC may be used by AHMC for the benefit of the Fund or
any other client of AHMC. AHMC is of the opinion that the continued receipt of
supplemental investment research services from broker-dealers will be essential
to its provision of portfolio management services to the Fund. AHMC has
represented that such commissions will not be paid by the Fund unless (a) AHMC
determines in good faith that the amount is reasonable in relation to the
services in terms of the particular transaction, (b) such payment is made in
compliance with Section 28(e) and other applicable state and federal laws, and
(c) in the opinion of AHMC, the total commissions paid by the Fund are
reasonable in relation to the benefits to the Fund over the long term. The
overall reasonableness of brokerage commissions paid is evaluated by AHMC based
upon its knowledge of available information as to the general level of
commissions paid by other institutional investors for comparable services.
It is anticipated that a substantial portion of the Fund's portfolio
transactions will be allocated to Thieme Securities, Inc. (TSI). Heiko H. Thieme
is the Chief Executive Officer and sole shareholder of TSI. Except for executing
portfolio transactions, TSI is not in any other respect associated with the Fund
or responsible for any investment advice or other service provided to the Fund
by Mr. Thieme personally or AHMC.
During the fiscal years ended May 31, 1997, 1998 and 1999, the Fund
paid brokerage commissions of $379,644, $990,836 and $444,766, respectively, to
TSI. During the fiscal year ended May 31, 1999, the commissions paid by the Fund
to TSI represented approximately 94% of the total brokerage commissions paid by
the Fund that year. During the same year, approximately 95% of the Fund's
aggregate dollar transactions involving the payment of brokerage commissions was
effected through TSI.
Richard K. Parker is a Managing Director of Bear, Stearns & Co. Inc.
(BSI). Prior to December 31, 1998, Mr. Parker owned 10% of the outstanding
capital stock of AHMC. During the fiscal years ended May 31 1997, 1998 and 1999
during the time Mr. Parker held his shares of AHMC, the Fund paid brokerage
commissions of $62,510, $136,527 and $14,520, respectively to BSI. From June 1,
1998 until December 31, 1998, the commissions paid by the Fund to BSI
represented approximately 3% of the total brokerage commissions paid by the Fund
during that period. During the same period, approximately 4% of the Fund's
aggregate dollar transactions involving the payment of brokerage commissions was
effected through BSI.
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
On April 17, 2000 Charles Schwab & Co. Inc., 101 Montgomery Street, San
Francisco, CA and National Financial Services Corp., P.O. Box 3908, New York, NY
10008 94104 owned
B-11
<PAGE> 32
of record shares of the Fund's capital stock which represented approximately 7%
and 6%, respectively, of the Fund's outstanding capital stock. As of such date,
no other person owned of record or was known to the Fund to own beneficially 5%
or more of the Fund's outstanding capital stock and the Fund's officers and
directors as a group owned less than 1% of such capital stock.
On April 10, 2000, the Fund's officers and directors as a group owned
less than 1% of the Fund's equity securities.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The Fund believes that for the fiscal year ended May 31, 1999 it
qualified as a "regulated investment company" under the Internal Revenue Code of
1986, as amended (the "Code"). The Fund intends to continue to so qualify if
qualification is in the best interests of its shareholders. Qualification
relieves the Fund of any liability for Federal income taxes to the extent its
net investment income and net realized capital gains are distributed in
accordance with the applicable provisions of the Code. To qualify as a regulated
investment company, the Fund must distribute at least 90% of its net income
(consisting of net investment income and net short-term capital gain) to its
shareholders, and meet certain asset diversification and other requirements. If
the Fund did not qualify as a regulated investment company, it would be treated
for tax purposes as an ordinary corporation subject to Federal income tax. The
term "regulated investment company" does not imply the supervision of management
or investment practices or policies by any government agency.
If you elect to receive dividends and distributions in cash, and your
dividend and distribution check is returned to the Fund as undeliverable or
remains uncashed for six months, the Fund reserves the right to reinvest the
dividend or distribution and all future dividends and distributions payable to
you in additional Fund shares at net asset value. No interest will accrue on
amounts represented by uncashed distribution or redemption checks.
Any dividend or distribution paid shortly after an investor's purchase
may have the effect of reducing the aggregate net asset value of his shares
below the cost of the investment. Such a dividend or distribution would be a
return of investment in an economic sense, although taxable. In addition, the
Code provides that if a shareholder holds shares of a Fund for six months or
less and has received a capital gain distribution with respect to the shares,
any loss incurred on the sale of the shares will be treated as long-term capital
loss to the extent of the capital gain distribution received.
Depending upon the composition of the Fund's income, if any, the entire
amount or a portion of the dividends from net investment income may qualify for
the dividends received deduction allowable to qualifying U.S. corporate
shareholders. In general, dividend income from the Fund distributed to
qualifying corporate shareholders will be eligible for the dividends received
deduction only to the extent that the Fund's income consists of dividends paid
by U.S.
B-12
<PAGE> 33
corporations. However, Section 246(c) of the Code provides that if a qualifying
corporate shareholder has disposed of Fund shares not held for less than 46
days, which 46 days generally must be during the 90-day period commencing 45
days before the shares become ex-divided, and has received a dividend from net
investment income with respect to such shares, the portion designated by the
Fund as qualifying for the dividends received deduction will not be eligible for
such shareholder's dividends received deduction. In addition, the Code provides
other limitations with respect to the ability of a qualifying corporate
shareholder to claim the dividends received deduction in connection with holding
Fund shares.
Ordinarily, gains or losses realized from portfolio transactions will
be treated as capital gains or losses. However, a portion of the gain or loss
realized from the disposition of certain non-U.S. dollar denominated securities
(including debt instruments) may be treated as ordinary income or loss under
Section 988 of the Code. In addition, all or a portion of the gain realized from
the disposition of certain market discount bonds will be treated as ordinary
income under Section 1276 of the Code. Finally, all or a portion of the gains
realized from engaging in "conversion transactions" may be treated as ordinary
income under Section 1258 of the Code. "Conversion transactions" include certain
transactions marketed or sold to produce capital gains, or transactions
described in Treasury regulations to be issued in the future.
Under Section 1256 of the Code, any gain or loss realized by the Fund
from certain options transactions will be treated as 60% long-term capital gain
or loss and 40% short-term capital gain or loss. Gain or loss will arise upon
exercise or lapse of the options as well as from closing transactions. In
addition, any such option remaining unexercised at the end of the Fund's taxable
year will be treated as sold for its then fair market value, resulting in
additional gain or loss to the Fund characterized in the manner described above.
Offsetting positions held by the Fund involving certain futures options
transactions may be considered, for tax purposes, to constitute straddles.
Straddles are defined to include offsetting positions in actively traded
personal property. The tax treatment of straddles is governed by Sections 1092
and 1258 of the Code, which, in certain circumstances, overrides or modifies the
provisions of Sections 988 and 1256 of the Code. As such, all or a portion of
any short or long-term capital gain from certain "straddle" and/or conversion
transactions may be recharacterized as ordinary income.
If the Fund were treated as entering into straddles by reason of its
engaging in certain options transactions, such straddles could be characterized
as mixed straddles if the options transactions comprising a part of such
straddles were governed by Section 1256 of the Code. The Fund may make one or
more elections with respect to "mixed straddles." Depending upon which election
is made, if any, the results to the Fund may differ. If no election is made, to
the extent the straddle rules apply to positions established by the Fund, losses
realized by the Fund will be deferred to the extent of unrealized gain in any
offsetting positions. Moreover, as a result of the straddle and conversion
transaction rules, short-term capital loss on straddle positions may be
recharacterized as long-term capital loss, and long-term capital gain may be
recharacterized as
B-13
<PAGE> 34
short-term capital gain or ordinary income.
INVESTMENT ADVISORY AND OTHER SERVICES
Heiko H. Thieme may be deemed to control AHMC by virtue of his record
and beneficial ownership of 90% of the outstanding capital stock thereof. Mr.
Thieme is the Chairman of the Board of Directors and the Chief Executive Officer
of AHMC. See "Management."
In connection with the Fund's Investment Advisory Agreement with AHMC,
AHMC provides the Fund with continuous investment advice. AHMC bears the
expenses of the Fund's trading operations. All other expenses of the Fund are
borne by the Fund. The Fund pays AHMC a fee which, on an annual basis, amounts
to one and one-quarter percent (1.25%) of the first $100 million of the value of
average daily net assets of the Fund and one percent (1%) of the value of any
additional net assets.
During the fiscal years ended May 31, 1997 and 1998 and 1999, the Fund
incurred investment advisory fees to AHMC of $206,091, $250,628 and $103,112,
respectively.
The Fund reimburses AHMC for office space and administrative personnel
utilized by the Fund. See Notes to the Financial Statements in the Fund's Annual
Report for the fiscal year ended May 31, 1999.
The Fund has entered into an agreement with American Data Services,
Inc.(ADS) whereby ADS maintains certain books, records and other documents that
the Fund is required to keep and calculates the Fund's daily net asset value.
The Fund has agreed to pay ADS a monthly fee of 1/12th of.1% of the first
$25,000,000 of the Fund's average monthly net assets, plus 1/12th of .05% of the
next $25,000,000 of the Fund's average monthly net assets, plus 1/12th of .02%
of any additional average monthly net assets. to maintain certain books, records
and other documents that the Fund is required to keep and calculate the Fund's
daily net asset value.
B-14
<PAGE> 35
RETURNS
Average annual total return is calculated by determining the ending
redeemable value of an investment purchased with a hypothetical $1,000 payment
made at the beginning of the period (assuming the reinvestment of dividends and
distributions), dividing by the amount of the initial investment, taking the
"n"-th root of the quotient (where "n" is the number of years in the period) and
subtracting 1 from the result. Total return is calculated by subtracting the
amount of the Fund's net asset value per share at the beginning of a stated
period from the net asset value per share at the end of the period (after giving
effect to the reinvestment of dividends and distributions during the period),
and dividing the result by the net asset value per share at the beginning of the
period.
Comparative performance information may be used from time to time in
advertising or marketing the Fund's shares, including data from Lipper
Analytical Services, Inc., the Dow Jones Industrial Average, Morningstar, Inc.,
Standard & Poor's 500 Composite Stock Price Index and other industry
publications. From time to time, advertising materials for the Fund may provide
historical information about the Fund, AHMC and Heiko H. Thieme.
From time to time, advertising materials for the Fund may refer to or
discuss current or past business, political, economic or financial conditions,
such as any U.S. monetary or fiscal policies. In addition, from time to time,
advertising materials for the Fund may include information concerning retirement
and investing for retirement.
CUSTODIAN
Firstar Bank, N.A., 425 Walnut Street, Cincinnati, Ohio is the Fund's
Custodian. The Custodian maintains custody of the Fund's cash and securities.
INDEPENDENT ACCOUNTANTS
Mathieson Aitken Jemison, LLP are the Fund's independent certified
public accountants. The financial statements included herein have been examined
by such firm to the extent set forth in their report.
TRANSFER AGENT
American Data Services, Inc., 150 Motor Parkway, Suite 109, Hauppauge,
New York 11788 is the Fund's transfer agent. The transfer agent maintains the
Fund's capital stock records, effects issuances and transfers of capital stock,
handles all correspondence with respect to shareholder accounts and processes
redemptions.
B-15
<PAGE> 36
INFORMATION ABOUT THE FUND
Each Fund share has one vote, and when issued and paid for in
accordance with the terms of the offering, is fully paid and nonassessable. Fund
shares are of one class and have equal rights as to dividends and in
liquidation. Shares have no preemptive, subscription or conversion rights and
are freely transferable.
The Fund is intended to be a long-term investment vehicle and is not
designed to provide investors with a means of speculating on short-term market
movements. A pattern of frequent purchases and exchanges can be disruptive to
efficient portfolio management and, consequently, can be detrimental to the
Funds' performance and its shareholders. Accordingly, if the Fund determines
that an investor is following a market timing strategy or is otherwise engaging
in excessive trading, the Fund, with or without prior notice, may temporarily or
permanently reject in whole or part any purchase, with respect to such
investor's account.
The Fund sends annual and semi-annual financial statements to all its
shareholders.
FINANCIAL STATEMENTS
The Fund's most recent Annual Report and Semi-Annual Report to
Shareholders are separate documents supplied with this Statement of Additional
Information. The financial statements, accompanying notes and report of
independent auditors appearing in the Annual Report are incorporated by
reference into this Statement of Additional Information.
B-16
<PAGE> 37
PART C
B-17
<PAGE> 38
OTHER INFORMATION
ITEM 23. EXHIBITS
(a) Certificate of Incorporation, as amended.
(b) By-Laws, as amended.
(c) Specimen Common Stock Certificate.
(d) Investment Advisory Agreement of December 16, 1993 by and
between the Registrant and American Heritage Management
Corporation.
(e) Not Applicable.
(f) Not Applicable.
(g) Custodian Agreement of December 29, 1993, as amended effective
on January 25, 1994 by and between the Registrant and Star
Bank, N.A.
(h) (1) Transfer Agency and Service Agreement of December
10, 1997 by and between the Registrant and American
Data Services, Inc.
(2) Fund Accounting Service Agreement of April 10, 1997
by and between the Registrant and American Data
Services, Inc.
(i) Not applicable.
(j) Consent of Mathieson Aitken Jemison, LLP.
(k) Not Applicable.
(l) Not Applicable.
(m) Not Applicable.
(n) Not Applicable.
(o) Not Applicable.
(p) (1) Code of Ethics of the Registrant
(2) Code of Ethics of American Heritage Management Corp.
C-1
<PAGE> 39
ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND
Not applicable.
ITEM 25. INDEMNIFICATION
Pursuant to the Registrant's Certificate of Incorporation and By-Laws,
each director, officer and employee of the Registrant shall be indemnified by
the Registrant in connection with any proceeding in which he has been made a
party by reason of such capacity other than for liabilities resulting from
willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office. Pursuant to a contract of
insurance, which the Registrant proposes to obtain, each of the Registrant's
directors, officers and employees and its investment advisor will be insured
against claims based upon any breach of duty, neglect, error, misstatement,
misleading statement, omission or act wrongfully done or attempted other than
actual or alleged fraud, dishonesty criminal or malicious acts or omissions
unless such allegations are subsequently disproved.
ITEM 26. PRINCIPAL UNDERWRITERS
Not applicable.
ITEM 28. LOCATION OF ACCOUNTS AND RECORDS
As used herein, the term "records" refers to accounts, books or other
documents.
The Registrant maintains physical possession of each record set forth
in Rule 31a-1(b)(1) under the Investment Company Act of 1940 (the "Act") at 1370
Avenue of the Americas, New York, New York 10019, except that records relating
to receipts and deliveries of portfolio securities are in the physical
possession of Firstar Bank, N.A., 425 Walnut Street, ML 5127, Cincinnati, Ohio
45202 and records relating to securities issued by the Registrant are in the
physical possession of American Data Services, Inc., 150 Motor Parkway, Suite
109, Hauppauge, New York 11788 ("ADS").
The records referred to in Rule 31a-1(b)(2)(i)(a), (b) and (c) under
the Act are in the physical possession of Firstar Bank, N.A.
The records referred to in Rule 31a-1(a) and Rule 31a-1(b)(2)(i)(d),
(e) and (f) under the Act are in the physical possession of ADS.
C-2
<PAGE> 40
The records referred to in Rule 31a-1(b)(2)(ii), (iii) and (iv) and
Rule 31a-1(b)(3) and (8) under the Act are in the physical possession of ADS.
The records referred to in Rule 31a-1(b)(2)(iv) and Rule 31a-1(b)(11)
under the Act are in the physical possession of ADS.
The records referred to in Rule 31a-1(b)(4), (5), (6), (7), (9),(10)
and (11) under the Act will be in the physical possession of the Registrant.
ITEM 29. MANAGEMENT SERVICES
Not applicable.
ITEM 30. UNDERTAKINGS
Not applicable.
C-3
<PAGE> 41
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Fund has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of New York and the State of New York on the 19th day of April, 2000.
THE AMERICAN HERITAGE FUND, INC.
By: /s/ Heiko H. Thieme
--------------------------------
Heiko H. Thieme, Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities and
on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ Heiko H. Thieme Chief Executive Officer, April 19, 2000
- -------------------------------------
Heiko H. Thieme Principal Financial and
Accounting Officer and
Director
Director
- -------------------------------------
Eugene Sarver
/s/ Stephen Swope Director April 19, 2000
- -------------------------------------
Stephen Swope
</TABLE>
C-4
<PAGE> 42
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBITS DESCRIPTION
-------- -----------
<S> <C>
(a) Certificate of Incorporation, as amended.
(b) By-Laws, as amended.
(c) Specimen Common Stock Certificate.
(d) Investment Advisory Agreement of December 16, 1993 by and
between the Registrant and American Heritage Management
Corporation.
(e) Not Applicable.
(f) Not Applicable.
(g) Custodian Agreement of December 29, 1993, as amended effective
on January 25, 1994 by and between the Registrant and Star
Bank, N.A.
(h) (1) Transfer Agency and Service Agreement of December
10, 1997 by and between the Registrant and American
Data Services, Inc.
(2) Fund Accounting Service Agreement of April 10, 1997
by and between the Registrant and American Data
Services, Inc.
(i) Not applicable.
(j) Consent of Mathieson Aitken Jemison, LLP.
(k) Not Applicable.
(l) Not Applicable.
(m) Not Applicable.
(n) Not Applicable.
(o) Not Applicable.
(p) (1) Code of Ethics of the Registrant
(2) Code of Ethics of American Heritage Management Corp.
</TABLE>
<PAGE> 1
Exhibit (a)
CERTIFICATE OF AMENDMENT
of the
CERTIFICATE OF INCORPORATION
of
THE HERITAGE FUND, INC.
Under Section 805 of the Business Corporation Law
We, the undersigned, being the President and the Secretary,
respectively of The Heritage Fund, Inc. hereby certify:
FIRST: That the name of the corporation is The Heritage Fund, Inc. and
that it was originally incorporated under the name "Spencer Grean Fund, Inc."
SECOND: That the Certificate of Incorporation of the corporation was
filed by the Department of State on December 28, 1951.
THIRD: The Certificate of Incorporation is amended:
a. To increase the amount of capital stock and the total number
of shares which the corporation is to be authorized to issue. Article
3 of the Certificate of Incorporation which contains the statement
with respect to the authorized shares is
<PAGE> 2
hereby amended to read as follows:
"3. The amount of the capital stock of the Corporation shall be Two
Million Dollars ($2,000,000) consisting of 20,000,000 shares of the par
value of $.10 each, all of which are to be of the same class."
b. To delete all references to determining the repurchase price
at a time other than at the close of the New York Stock Exchange.
Paragraph (2) of paragraph C of Article 14 of the Certificate of
Incorporation which states the method of computing the repurchase
price, per share, is hereby stricken out in its entirety, and the
following is substituted in lieu thereof:
"(2) The repurchase price, per share, to be paid by the
Corporation shall be the redemption value, per share, of the
shares to be repurchased less such withdrawal charge, if any, as
may be fixed by the Board of Directors pursuant to paragraph (1)
of paragraph A
-2-
<PAGE> 3
of this Article 14. Such redemption value, per share, shall be the
net asset value next computed after proper tender and acceptance
pursuant to paragraph (1) of this paragraph C. Such price, per
share, if resulting in a fraction of a cent shall be adjusted to the
next lower cent."
c. To change the post office address to which the Secretary of
State shall mail a copy of any process against the Corporation served upon
him to:
7524 East Progress Place, Denver, Colorado 80232.
FOURTH: The amendments to the Certificate of Incorporation set forth in
paragraphs a and b of Article Third hereof were authorized by the vote of the
holders of a majority of all outstanding shares entitled to vote thereon at a
meeting of the shareholders; the amendment to the Certificate of Incorporation
set forth in paragraph c was authorized by the vote of the majority of directors
present at a meeting of the Board of Directors at which a quorum was present.
IN WITNESS WHEREOF, this Certificate has been signed this 1st day of
April, 1971.
THE HERITAGE FUND, INC.
/s/ Bassett S. Winmill
-----------------------------
Bassett S. Winmill, President
/s/ Mark C. Jones
-----------------------------
Mark C. Jones, Secretary
-3-
<PAGE> 4
STATE OF NEW YORK )
: SS.:
COUNTY OF NEW YORK )
BASSETT S. WINMILL, being duly sworn deposes and says that he is the
President of the Heritage Fund, Inc., the Corporation and one of the persons who
signed the foregoing Certificate of Amendment, that he has read the Certificate
of Amendment and knows the contents thereof and that the same is true to his own
knowledge.
/s/ Bassett S. Winmill
-------------------------
Bassett S. Winmill
Sworn to before me this 1st
day of April 1971.
/s/ Francine M. Wagel
- -------------------------
Notary Public
4
<PAGE> 5
CERTIFICATE OF AMENDMENT
of the
CERTIFICATE OF INCORPORATION
of
THE HERITAGE FUND, INC.
Under Section 805
of the
Business Corporation Law
BREED, ABBOTT & MORGAN
COUNSELORS AT LAW
1 CHASE MANHATTAN PLAZA, NEW YORK, N.Y. 10005
944-4800
All communications should be referred to Mr.
[NOTARY STAMP]
--------------
STATE OF NEW YORK
DEPARTMENT OF STATE
FILED APR 16 1971
TAX $750
FILING FEE $30
SECRETARY OF STATE
<PAGE> 6
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
THE HERITAGE FUND, INC.
Under Section 805 of the Business Corporation Law
Pursuant to the provisions of Section 805 of the Business Corporation Law,
the undersigned, being the President and the Secretary, respectively, of The
Heritage Fund, Inc. hereby certify:
FIRST: That the name of the corporation is The Heritage Fund, Inc. and
that it was originally incorporated under the name "Spencer Grean Fund, Inc."
SECOND: That the Certificate of Incorporation of the corporation was filed
by the Department of State, Albany, New York, on the 28th day of December 1951.
THIRD: That the amendment to the Certificate of Incorporation effected by
this Certificate is as follows:
Article Number 3 of the Certificate of Incorporation is hereby amended
to read as follows:
"3. The amount of the capital stock of the Corporation shall be Five
Hundred Thousand Dollars ($500,000) consisting of 5,000,000 shares of the
par value of 10[cents] each, all of which are to be of the same class."
FOURTH: That the par value of each of the corporation's previously
authorized 500,000 shares of the par
<PAGE> 7
value of $1.00 each, of which 61,255 shares were issued and outstanding on
March 8, 1966, is hereby changed to a par value of 10 cents each, and that the
number of shares which the corporation is authorized to issue is hereby
increased to 5,000,000 shares.
FIFTH: That the stated capital of the corporation as of March 8, 1966 is
hereby reduced from $61,255.00 to $6,125.50 by the change in par value of issued
shares referred to above.
SIXTH: That the amendment of the Certificate of Incorporation was
authorized by a vote of the holders of a majority of all outstanding shares
entitled to vote on an amendment to the Certificate of Incorporation at a
meeting of shareholders.
IN WITNESS WHEREOF, this Certificate has been signed this 6th day of May,
1966.
THE HERITAGE FUND, INC.
/s/ Bassett S. Winmill
----------------------------------------
Bassett S. Winmill
President
/s/ John W. Hurley
----------------------------------------
John W. Hurley
Secretary
2
<PAGE> 8
STATE OF )
: ss.:
COUNTY OF )
Bassett S. Winmill, being duly sworn, deposes and says that he is
President of The Heritage Fund, Inc., the corporation mentioned and described
in the foregoing instrument; that he has read and signed the same and that the
statements contained therein are true.
/s/ Bassett S. Winmill
----------------------------------------
Sworn to before me this
6th day of May, 1966.
/s/ [Illegible Signature]
- --------------------------------------
3
<PAGE> 9
STATE OF )
: ss.:
COUNTY OF )
Bassett S. Winmill, being duly sworn, deposes and says that he is
President of The Heritage Fund, Inc., the corporation mentioned and described
in the foregoing instrument; that he has read and signed the same and that the
statements contained therein are true.
/s/ Bassett S. Winmill
----------------------------------------
Sworn to before me this
6th day of May, 1966.
/s/ [ILLEGIBLE SIGNATURE]
- -------------------------------------
3
<PAGE> 10
STATE OF )
: ss.:
COUNTY OF )
Bassett S. Winmill, being duly sworn, deposes and says that he is
President of The Heritage Fund, Inc., the corporation mentioned and described
in the foregoing instrument; that he has read and signed the same and that the
statements contained therein are true.
/s/ Bassett S. Winmill
----------------------------------------
Sworn to before me this
6th day of May, 1966.
/s/ [ILLEGIBLE SIGNATURE]
- -------------------------------------
3
<PAGE> 11
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
THE HERITAGE FUND, INC.
UNDER SECTION 805 OF THE
BUSINESS CORPORATION LAW
* * * * * * * * * * * * * * * * * * *
Debevoise Plimpton Lyons & Gates
320 Park Avenue
New York, New York
<PAGE> 12
CERTIFICATE OF AMENDMENT
of the
CERTIFICATE OF INCORPORATION
of
THE HERITAGE FUND, INC.
Under Section 805 of the Business Corporation Law
We, the undersigned, being the President and the Secretary, respectively
of The Heritage Fund, Inc. hereby certify:
FIRST: That the name of the corporation is The Heritage Fund, Inc. and
that it was originally incorporated under the name "Spencer Grean Fund, Inc."
SECOND: That the Certificate of Incorporation of the corporation was filed
by the Department of State on December 28, 1951.
THIRD: The Certificate of Incorporation is amended to change the post
office address to which the Secretary of State shall mail a copy of any process
against the Corporation served upon him to:
200 Josephine Street, Denver, Colorado 80206
FOURTH: The amendment to the Certificate of Incorporation set forth above
was authorized by the vote of the majority of directors present at a meeting of
the Board of Directors at which a quorum was present.
IN WITNESS WHEREOF, this Certificate has been signed this 15th day of
August, 1972.
THE HERITAGE FUND, INC.
/s/ Benjamin R. Howe
----------------------------------------
Benjamin R. Howe, President
/s/ Madge M. Dillon
----------------------------------------
Madge M. Dillon, Secretary
1
<PAGE> 13
STATE OF COLORADO )
) ss.:
COUNTY OF DENVER )
BENJAMIN R. HOWE, being duly sworn deposes and says that he is the
President of The Heritage Fund, Inc., the Corporation and one of the persons
who signed the foregoing Certificate of Amendment, that he has read the
Certificate of Amendment and knows the contents thereof and that the same is
true to his own knowledge.
/s/ Benjamin R. Howe
--------------------
Benjamin R. Howe
Sworn to before me this 15th
day of August, 1972.
/s/ [Illegible Signature]
- -------------------------
Notary Public
2
<PAGE> 14
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF INCORPORATION
OF
THE HERITAGE FUND, INC.
Pursuant to Section 805 of the
Business Corporation Law
Hopper and Kanouff, Esqs.
2418 Prudential Plaza
1050 Seventeenth Street
Denver, Colorado 80202
3
<PAGE> 15
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF INCORPORATION
OF
THE HERITAGE FUND, INC.
UNDER SECTION 805 OF THE
BUSINESS CORPORATION LAW
* * * * *
WE, THE UNDERSIGNED, Jefferson R. Bender and Richard A. Hudson, being
respectively the President and the Secretary of THE HERITAGE FUND, INC. hereby
certify:
1. The name of the corporation is
THE HERITAGE FUND, INC. The original name was Spencer Grean Fund, Inc.
2. The Certificate of Incorporation of said corporation was filed by the
Department of State on the 28th day of December, 1951.
3. (a) The Certificate of Incorporation is amended to change the name of
the corporation.
(b) To effect the foregoing, Article "1." relating to the corporate
name is amended to read as follows:
"1. The name of the corporation is THE AMERICAN HERITAGE FUND, INC."
<PAGE> 16
4. The amendment was authorized by the affirmative vote of a majority of
all the outstanding shares entitled to vote.
IN WITNESS WHEREOF, we have signed this certificate on the 2 day of July,
1976, and we affirm the statements contained therein as true under penalties of
perjury.
/s/ Jefferson R. Bender
__________________________________
Jefferson R. Bender President
/s/ Richard A. Hudson
__________________________________
Richard A. Hudson Secretary
-2-
<PAGE> 17
* * * * * * * * * * * * * *
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF INCORPORATION
OF
THE HERITAGE FUND, INC.
UNDER SECTION 805 OF THE
BUSINESS CORPORATION LAW
* * * * * * * * * * * * * *
Jonathan Reisman, Atty.
1401 Brickell Avenue
Suite 808
Miami, Florida 33131
3
<PAGE> 18
CERTIFICATE OF AMENDMENT
OF THE CERTIFICATE OF INCORPORATION
OF
THE AMERICAN HERITAGE FUND, INC.
UNDER SECTION 805 OF THE BUSINESS CORPORATION LAW
* * * * *
WE, THE UNDERSIGNED, Henry S. Krauss and Richard K. Parker, being
respectively the president and secretary of THE AMERICAN HERITAGE FUND, INC.
hereby certify:
1. The name of the corporation is THE AMERICAN HERITAGE FUND, INC.
The name under which the corporation was formed is SPENCER GREAN FUND, INC.
2. The certificate of incorporation of said corporation was filed
by the Department of State on the 28th day of December, 1951.
3. (a) The certificate of incorporation is amended to increase the
number of authorized shares the corporation may issue from twenty million
(20,000,000) capital shares of the par value of Ten Cents ($.10) per share to
fifty million (50,000,000) capital shares of the par value of Ten Cents ($.10)
per share.
(b) To effect the foregoing, Article Three relating to the
authorized shares is amended in its entirety to read as follows:
1
<PAGE> 19
ARTICLE THREE. The aggregate number of shares which the corporation
shall have the authority to issue is fifty million (50,000,000) capital shares
of the par value of Ten Cents ($.10) each.
The amendment was authorized in the following manner:
By vote of a majority of all the outstanding shares entitled to vote
subsequent to authorization by the unanimous vote of the Board of Directors.
IN WITNESS WHEREOF, we have signed this certificate on the first day of
February, 1990 and we affirm the statements contained therein as true under
penalties of perjury.
/s/ HENRY S. KRAUSS
----------------------------
Henry S. Krauss, President
/s/ RICHARD K. PARKER
----------------------------
Richard K. Parker, Secretary
2
<PAGE> 20
CERTIFICATE OF AMENDMENT OF
THE CERTIFICATE OF INCORPORATION
OF
THE AMERICAN HERITAGE FUND, INC.
UNDER SECTION 805 OF THE BUSINESS CORPORATION LAW
Reisman & Associates, P.A.
1200 Brickell Avenue
Ste 800
Miami, FL 33131
3
<PAGE> 21
CERTIFICATE OF AMENDMENT
OF THE CERTIFICATE OF INCORPORATION
OF
THE AMERICAN HERITAGE FUND, INC.
UNDER SECTION 805 OF THE BUSINESS CORPORATION LAW
* * * * *
WE, THE UNDERSIGNED, Richard K. Parker and Heiko H. Thieme, being
respectively the president and secretary of THE AMERICAN HERITAGE FUND, INC.
hereby certify:
1. The name of the corporation is THE AMERICAN HERITAGE FUND, INC.
The name under which the corporation was formed is SPENCER GREAN FUND, INC.
2. The Certificate of Incorporation of said corporation was filed
by the Department of State on the 28th day of December, 1951.
3. (a) The Certificate of Incorporation is amended to change the
number of authorized shares the corporation may issue from Fifty Million
(50,000,000) capital shares to One Billion (1,000,000,000) capital shares and
to simultaneously change the par value of each of such shares, whether issued or
unissued, to One Cent ($.01) each. Accordingly, 39,790,932.486 issued capital
shares having a par value of Ten Cents ($.10) each are changed into a like
number of capital shares having a par value of One Cent ($.01) each and
10,209,067.514 unissued capital shares having a par value of Ten Cents ($.10)
each are changed into 960,209,067.514 unissued capital shares having a
1
<PAGE> 22
par value of One Cent ($.01) each at a rate of 94.05 to one. No other terms
were involved in the foregoing.
(b) To effect the foregoing, Article Three of the Certificate
of Incorporation is amended in its entirety to read as follows:
ARTICLE THREE. The aggregate number of shares which the
corporation shall have the authority to issue is One Billion capital shares.
The par value of each of such shares, whether issued or unissued, shall be One
Cent ($.01) each.
4. The amendment to ARTICLE THREE of the Certificate of
Incorporation reduces stated capital by reducing the par value per outstanding
share from Ten Cents ($.10) to One Cent ($.01). An aggregate of $3,581,183.92
is being transferred from stated capital to surplus.
5. The amendment was authorized in the following manner:
By a majority vote of the Board of Directors followed by vote of a majority of
all the outstanding shares entitled to vote.
In WITNESS WHEREOF, we have signed this certificate on the 20th day
of May, 1993 and we affirm the statements contained therein as true under
penalties of perjury.
/s/ RICHARD K. PARKER
---------------------------------
RICHARD K. PARKER, President
/s/ HEIKO H. THIEME
---------------------------------
HEIKO H. THIEME, Secretary
2
<PAGE> 23
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF INCORPORATION
OF
THE AMERICAN HERITAGE FUND, INC.
UNDER SECTION 805 OF THE
BUSINESS CORPORATION LAW
Reisman and Associates, P.A.
2601 South Bayshore Drive, Suite 1225
Miami, FL 33133
<PAGE> 24
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION
TO CHANGE NAME OF
SPENCER GREAN FUND, INC.
(Pursuant to Section 36 of the Stock Corporation Law)
WE, the undersigned, being the President and the Secretary, respectively,
of SPENCER GREAN FUND, INC., do hereby certify as follows:
1. The name of the Corporation is Spencer Grean Fund, Inc.
2. The Certificate of Incorporation of said Corporation was filed in the
office of the Secretary of State on the 28th day of December, 1951.
3. The Certificate of Incorporation is amended to effect the following
changes authorized in subdivision 2 of Section 35 of the Stock Corporation Law,
to wit:
To change the name of the Corporation from the Spencer Grean Fund,
Inc. to The Heritage Fund, Inc.
4. Article 1 of the Certificate of Incorporation of this Corporation,
which Article declares the name of the Corporation, is hereby amended to read
as follows:
"1. The name of the Corporation shall be The Heritage Fund, Inc.
(hereinafter called the "Corporation")."
IN WITNESS WHEREOF, we have hereunto subscribed and acknowledged this
Certificate this 20th day of August, 1956.
/s/ S. Spencer Grean
-------------------------------------
President
/s/ Hiram G. Shields
-------------------------------------
Secretary
STATE OF NEW YORK )
COUNTY OF NEW YORK) SS.:
On the 13 day of August, 1956, before me personally.
<PAGE> 25
came S. SPENCER GREAN and HIRAM G. SHIELDS, to me known and known to me to be
the persons described in and who executed the foregoing Certificate, and they
duly and severally acknowledge to me that they executed the same.
/s/ Sadie Cahn
---------------
Notary Public
<PAGE> 26
STATE OF NEW YORK)
: ss.:
COUNTY OF NEW YORK)
S. SPENCER GREAN and HIRAM G. SHIELDS, being severally and duly sworn, do
depose and say, and each for himself deposes and says: That he, the said S.
Spencer Grean, is the President of Spencer Grean Fund, Inc., and that he, the
said Hiram G. Shields, is the Secretary thereof; that they have been authorized
to execute and file the foregoing Certificate by the votes, cast in person or
by proxy, of the holders of record of a majority of the outstanding shares
entitled to vote at the Stockholders Meeting at which such votes were cast with
relation to, the proceedings provided in the foregoing Certificate, and that
neither the Certificate of Incorporation, nor any other certificate filed
pursuant to law, required a larger proportion of votes. That such votes were
cast at a stockholders meeting held at No. 33 West 42nd Street, Borough of
Manhattan, City of New York, New York, on the 15th day of August, 1956, at
10:00 A.M., upon notice pursuant to Section 45 of the Stock Corporation Law.
/s/ S. Spencer Grean
---------------------
S. Spencer Grean
/s/ Hiram G. Shields
--------------------
Hiram G. Shields
/s/ Sadie Cahn
- --------------------
Subscribed and sworn to before me
this 13 day of August, 1956.
<PAGE> 27
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION
TO CHANGE NAME OF
SPENCER GREAN FUND, INC.
------------------------
(Pursuant to Section 36 of
the Stock Corporation Law)
Dated: August , 1956
GORDON, BRADY, CAPPREY & KELLER
80 PINE STREET, NEW YORK, NY
<PAGE> 28
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION
TO CHANGE NUMBER OF SHARES OF
SPENCER GREAN FUND, INC.
(Pursuant to Section 36 of the Stock Corporation Law)
WE, the undersigned, being the President and the Secretary,
respectively, of SPENCER GREAN FUND, INC., do hereby certify as follows:
1. The name of the Corporation is Spencer Grean Fund, Inc.
2. The Certificate of Incorporation of said Corporation was filed
in the office of the Secretary of State on the 28th day of December, 1951.
3. The Certificate of Incorporation is amended to effect the
following changes authorized in subdivision 2 of Section 35 of the Stock
Corporation Law, to wit:
To change the previously authorized shares of the Corporation,
being 5,000 shares of common stock, each of the par value of $100, all of the
same class, into 500,000 shares of stock, each to be of the par value of $1.00,
all to be of the same class.
4. Article 3 of the Certificate of Incorporation of this
Corporation, which Article provides as to the amount of capital stock and the
number of shares of this Corporation and the par value thereof, is hereby
amended to read as follows:
"3. The amount of the capital stock of the Corporation shall be
Five Hundred Thousand Dollars ($500,000) consisting of 500,000 shares
of the par value of $1.00 each, all of which are to be of the same
class.
5. The terms upon which the change of the shares previously
authorized into the shares authorized by this
<PAGE> 29
certificate is to be made are as follows:
Each of the previously authorized shares of the Corporation, each of the
par value of $100, of which 5,000 shares have been authorized and of which 851
shares are issued and outstanding, 55 shares are in the treasury, and 4094
shares are authorized and unissued, shall be changed into 100 shares of the
stock now authorized, each to be of the par value of $1.00.
IN WITNESS WHEREOF, we have hereunto subscribed and acknowledged this
Certificate this 15th day of July, 1953.
/s/ S. Spencer Grean
------------------------------
President
/s/ Albert L. Haas
------------------------------
Secretary
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 15th day of July, 1953, before me personally came S. SPENCER GREAN
and ALBERT L. HAAS, to me known and known to me to be the persons described in
and who executed the foregoing Certificate, and they duly and severally
acknowledged to me that they executed the same.
/s/ Joseph Van Damm
------------------------------
Notary Public
<PAGE> 30
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
S. SPENCER GREAN and ALBERT L. HAAS, being severally and duly sworn, do
depose and say, and each for himself desposes and says: That he, the said S.
Spencer Grean, is the President of Spencer Grean Fund, Inc., and that he, the
said Albert L. Haas, is the Secretary thereof; that they have been authorized
to execute and file the foregoing Certificate by the votes, cast in person or
by proxy, of the holders of record of two-thirds of the outstanding shares
entitled to vote at the Stockholders Meeting at which such votes were cast with
relation to the proceedings provided in the foregoing Certificate, and that
neither the Certificate of Incorporation, nor any other certificate filed
pursuant to law, required a larger proportion of votes. That such votes were
cast at a stockholders meeting held at No. 33 West 42nd Street, Borough of
Manhattan, City of New York, New York, on the 15th day of July, 1953, at 10:00
A.M., upon notice pursuant to Section 45 of the Stock Corporation Law.
/s/ S. Spencer Grean
------------------------------
S. Spencer Grean
/s/ Albert L. Haas
------------------------------
Albert L. Haas
Subscribed and sworn to before me
this 15th day of July, 1953.
/s/ Joseph Van Damm
------------------------------
<PAGE> 31
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
S. SPENCER GREAN AND JULIUS A. LEVINE, being severally and duly
sworn do depose and say, and each for himself deposes and says:
That he the said S. Spencer Grean is the duly elected, qualified and
acting President of SPENCER GREAN FUND, INC., and that he the said Julius A.
Levine is the duly elected, qualified and acting Treasurer of said Corporation;
that in pursuance of Section 37, Subdivision 5, of the Stock Corporation Law,
they do each hereby state that the number of shares changed by the annexed
Certificate of Amendment of the Certificate of Incorporation of Spencer Grean
Fund, Inc., is 5,000 shares of the par value of $100 each, of which 851 shares
were issued and outstanding as of July 15, 1953; 55 shares were in the treasury
as of that date; and 4094 shares were authorized and unissued as of that date;
that the said 5,000 shares of the par value of $100 each are changed by the
annexed Certificate of Amendment into 500,000 shares of the par value of $1.00
each, of which 85,100 shares shall be issued and outstanding, 5,500 shares shall
be in the treasury, and 409,400 shares shall be authorized and unissued,
immediately after such change is effective.
The annexed Certificate does not authorize the increase in par value
of shares not resulting from a
<PAGE> 32
change in shares; and the number of additional shares not resulting from a
change of shares which the Corporation is thereby authorized to issued is none.
/s/ S. Spencer Grean
-----------------------------
S. Spencer Grean
/s/ Julius A. Levine
-----------------------------
Julius A. Levine
Sworn to before me this
20th day of July, 1953
/s/ Patricia A. Roberts
- -----------------------------
<PAGE> 33
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION
TO CHANGE NUMBER OF SHARES OF
SPENCER GREAN FUND, INC.
------------------------
(Pursuant to Section 36 of the
Stock Corporation Law)
Dated: July 15, 1953.
GORDON, BRADY, CAPPREY & KELLER
80 PINE STREET, NEW YORK, N.Y.
<PAGE> 34
CERTIFICATE OF AMENDMENT OF
CERTIFICATE OF INCORPORATION
TO CHANGE NUMBER OF SHARES OF
SPENCER GREAN FUND, INC.
------------------------
(Pursuant to Section 36 of the
Stock Corporation Law)
Dated: July 15, 1953.
GORDON, BRADY, CAPPREY & KELLER
80 PINE STREET, NEW YORK, N.Y.
<PAGE> 35
CERTIFICATE OF INCORPORATION
OF
SPENCER GREAN FUND, INC.
Pursuant to Article Two
of the Stock Corporation Law.
----------------
WE, the undersigned, desiring to form a corporation pursuant to Article Two
of the Stock Corporation Law of the State of New York, do hereby make, subscribe
and acknowledge this Certificate for that purpose, hereby certifying as follows:
1. The name of the corporation shall be SPENCER GREAN FUND, INC.
(hereinafter called the "Corporation").
2. The purposes for which it is to be formed are as follows:
To purchase, subscribe for, or cause to be subscribed for, acquire in
any lawful manner, invest in for cash or on margin, receive, own, hold, pledge,
hypothecate, sell, dispose of, avail of, underwrite, handle on commission or
otherwise deal in or with, all forms of fully or partly paid securities in, of,
or made, created or issued by any corporations, companies, associations,
partnerships, syndicates, trusts, individuals, governments, states,
municipalities and other political divisions or subdivisions thereof, or by any
organizations or entities whatsoever, irrespective of their form or the name by
which they may be described, and whether or not they be domestic or foreign with
respect to the State of New York or the United States, and whether or not the
purposes, powers, character of business carried on, the assets held by them, or
the assets comprised in such property be similar to the purposes, powers,
character of business carried on, or to the assets held by the Corporation, or
whether or not any contingent or other liability against the Corporation may
arise or exist in respect of the doing of any of the foregoing things; to
acquire and become interested in any such securities as aforesaid by issuing in
exchange or in payment therefor, in any lawful manner, its own stock or
securities or to make payment therefor by any lawful means; to exercise, while
the holder or owner of any of the securities above referred to, all the rights,
powers and privileges appertaining to the holding or ownership thereof to the
same extent that any individual might or could do.
<PAGE> 36
The term "securities", whenever the same appears herein, shall be
deemed to include, without limitation of the generality thereof, shares, stocks,
notes, bonds, debentures, obligations, warrants, scrip, rights, certificates,
receipts or other instruments representing rights to receive, purchase or
subscribe for the same, or representing any other rights or interests therein,
or in any property or assets.
To conduct researches and investigations in respect of securities,
organizations, businesses and general business conditions, in the United States
and elsewhere, to secure information pertinent to the investment and employment
of the assets and funds of the Corporation and of others, to furnish investment
advice, to manage investment funds for others, to procure any or all of the
foregoing to be done by others as independent contractors, and to pay
compensation therefor.
To the extent now or hereafter permitted by law, to lend money, funds
or credit, on demand, on call, or on time, whether secured or unsecured, to any
corporations, companies, associations, partnerships, trusts, syndicates,
individuals, governments, states, municipalities and other political divisions
or subdivisions thereof.
To aid by loan, credit, subsidy, the assumption of liabilities, or in
any other manner, those issuing, creating or responsible for any such securities
above referred to, and to do all acts and things designed to protect, improve or
enhance the value of any such securities; to make any guaranty respecting
stocks, dividends, securities, indebtedness, interest, contracts or other
obligations so far as the same may be permitted to, or done by, a corporation
organized under the laws of the State of New York.
To borrow money, funds or credit and otherwise contract indebtedness
for the general purposes of the Corporation and to draw, make, accept, endorse,
execute and issue promissory notes, drafts, warrants, bonds, debentures or other
negotiable or non-negotiable instruments, evidences of indebtedness or
obligations and, if desired, to secure the same and the interest thereon by
mortgage of, conveyance of, deed of trust of, pledge of or through lien upon
property, franchises, rights and privileges of every kind or nature, or any
part thereof, then owned or thereafter acquired by the Corporation; to confer
upon the holders of bonds, debentures or obligations of the Corporation,
secured or unsecured, and either before or after the issuance thereof, the right
to convert the same into stock of the Corporation upon such terms and conditions
as may be deemed advisable.
To endorse or guarantee the payment of principal of or interest upon
or dividends upon any securities or any persons in whom or in the affairs of
whom the Corporation may be interested.
-2-
<PAGE> 37
To conduct business in the State of New York, other states,
territories, districts and colonies of the United States of America and in
foreign countries; to have one or more offices within or without the State of
New York.
To issue, purchase, acquire, exchange, hold, pledge, hypothecate,
avail of, buy, sell and otherwise dispose of for money, property or other
consideration, shares or certificates entitling the holders thereof to an
interest in all or any part of the securities from time to time held by the
Corporation.
To acquire, hold, dispose of, transfer, reissue or cancel its own
securities (including shares of its capital stock of any class) in any manner
and to any extent now or hereafter permitted by the laws of the State of New
York and by this Certificate of Incorporation, provided that shares of its own
capital stock belonging to the Corporation shall not be voted upon directly or
indirectly.
To purchase, take on lease or in exchange, hire, or otherwise acquire,
hold, own, possess, equip, improve, develop, deal in, sell, convey, assign,
mortgage, pledge or otherwise encumber any and all goods, wares, merchandise,
commodities and other property, real, personal and mixed of every kind and
description, and rights, estates, interests, franchises, licenses and privileges
in such property, real, personal or mixed, wheresoever situated or located.
To apply for, acquire by purchase, assignment, grant, license or
otherwise, register, use and hold, own, exploit, operate, enjoy, sell, assign or
otherwise dispose of, either absolutely or by way of lease, mortgage, pledge or
license, to grant licenses in respect of and otherwise turn to account, any
letters patent of the United States of America or of any other country, state,
locality or authority, or pending applications therefor, and any inventions,
improvements, devices, trade secrets, formulae, processes, trade marks, trade
names, brands, labels, copyrights and privileges and any right, title or
interest therein, granted by or recognized by the United States of America or
any other country, state, locality or authority and any or all rights, interests
and privileges connected therewith or incidental or appertaining thereto that
may relate to or be useful in connection with any business which the Corporation
is authorized to carry on.
To sell, assign, transfer, convey, lease or exchange all or
substantially all of its property and assets, including its good will and its
corporate franchises, to the extent now or hereafter permitted by the laws of
the State of New York and by this Certificate of Incorporation, upon such terms
and conditions and for such consideration, which may be in whole or in part
stock or shares in, and/or other securities of, any one or more corporations,
companies, associations, trusts or entities, as its Board of Directors shall
deem expedient.
-3-
<PAGE> 38
To enter into, make, perform and carry out or cancel and rescind contracts
for any lawful purposes pertaining to its business with any person, firm,
association, trust, company, corporation, or entity or governmental, municipal
or public authority, domestic or foreign, and to carry out any one or more of
the objects or purposes of the Corporation as principal, factor, agent, trustee
or otherwise, and either alone or with associates.
To engage in any mercantile, manufacturing, mining, commercial or trading
business of any kind or character whatsoever, within or without the State of
New York, and to do all things incidental to any such business; to cause to be
formed, merged, reorganized or liquidated, and to promote, take charge of and
aid, in any way permitted by law, the formation, merger, reorganization or
liquidation of any firm, association, trust, company, corporation, syndicate or
entity in the United States or abroad.
To act in any capacity whatsoever as financial, commercial or business
agent or representative, general or special, for any persons.
To purchase, acquire, hold, mortgage, lease, rent, sell and otherwise
dispose of, convey and transfer, for money, property or other consideration,
real estate, interests in real estate, leaseholds, public utility franchises and
other rights, licenses, permits, grants and concessions issued by government
authority, whether Federal, state or local, and whether the same shall be
without the State of New York, or within the State of New York.
To enter into, join, make, perform and carry out, or cancel and rescind,
contracts of underwriting of, or any selling group or purchase group agreements
in connection with, the securities or business of any persons or to act as
manager of any such syndicate or group.
To do all and everything necessary or suitable and proper for the
accomplishment of any of the purposes or the furtherance of any of the powers
hereinbefore set forth, either alone or in association with other corporations,
firms, or individuals, and to do every other act or acts, thing or things,
incidental or appurtenant to or growing out of or connected with the aforesaid
purposes, business or powers, or any part or parts thereof, provided the same be
not inconsistent with the laws of the State of New York.
The purposes and powers specified in the foregoing clauses of this Article
2 shall, except as otherwise expressly provided, in nowise be limited or
restricted by reference to or inference from the terms of any other clause of
this or any other Article of this Certificate, but the purposes and powers
specified in each or the clauses of this Article 2 shall be construed
-4-
<PAGE> 39
as independent purposes and powers, and the foregoing enumeration of specific
powers shall not be held, and is not intended, to limit or restrict in any
manner the powers of the Corporation but is in furtherance of and in addition
to the general powers conferred upon corporations organized under the Stock
Corporation Law of the State of New York.
3. The amount of the capital stock of the Corporation shall be Five
Hundred Thousand Dollars ($500,000) consisting of 5,000 shares of the par value
of $100 each.
4. The Board of Directors may, to the extent permitted by law, in its sole
and uncontrolled discretion, upon presentation for transfer of any certificate
of stock, purchase for the Corporation, without prior notice, the share or
shares of stock represented thereby by paying therefor in cash a sum equal to
the then net asset value of such share or shares, in accordance with the
definition of the term "net asset value" as hereinafter in paragraph "15"
defined. If a stockholder shall be indebted to the Corporation, the Directors
may refuse to consent to a transfer of his stock until such indebtedness is
paid.
5. The principal office of the Corporation shall be located in the Borough
of Manhattan, City, County and State of New York, and the address within the
State to which the Secretary of State shall mail a copy of process in any
action or proceeding against the Corporation which may be served it is 33 West
42nd Street, Borough of Manhattan, New York, New York.
6. The duration of the Corporation shall be perpetual.
7. The number of directors of the Corporation shall be fixed from time to
time by the By-Laws of the Corporation, but shall not be less than three (3) nor
more than nine (9). The directors may be divided into two or more classes, whose
terms of office shall respectively expire at different times, as shall be
provided in the By-Laws of the Corporation. No director need be a stockholder of
the Corporation.
8. The names and post office addresses of the directors to serve until the
first annual meeting of the stockholders are as follows:
Names Post Office Addresses
----- ---------------------
Hiram G. Shields 565 Fifth Ave., New York, N.Y.
Albert L. Haas 43 Shore Park Road, Great Neck,
New York
Harry Copen 230 Fifth Ave., New York, N.Y.
-5-
<PAGE> 40
NAMES POST OFFICE ADDRESSES
----- -----------------------------
Julius A. Levine 51 Chambers Street
New York, New York
S. Spencer Green 33 West 42nd Street
New York, New York
9. The name and post office address of each subscriber of this
Certificate and the number of shares of the stock of the Corporation which he
agrees to take are as follows:
NAMES POST OFFICE NO. OF
----- ADDRESSES SHARES
----------- ------
Hiram G. Shields 565 Fifth Avenue 1
New York, N.Y.
Albert L. Haas 43 Shore Park Road 1
Great Neck, N.Y.
Julius A. Levine 51 Chambers Street 1
New York, New York
S. Spencer Green 33 West 42nd Street 1
New York, New York
10. All of the subscribers of this Certificate are of full age, at
least two-thirds of them are citizens of the United States, at least one of them
is a resident of the State of New York, and at least one of the persons named as
directors is a citizen of the United States and a resident of the State of New
York.
11. The Secretary of State of the State of New York is designated as
the agent of the Corporation upon whom process in any action or proceeding
against it may be served.
12. No holder of stock of any class of the Corporation shall be
entitled as of right to subscribe to or purchase any additional or increased
stock of any class (whether now or hereafter authorized) or obligations
convertible into any class or classes of stock or stock of any class convertible
into stock of any other class or classes and/or obligations, or stock or other
securities carrying warrants or rights to subscribe to stock of the Corporation
of any class or classes (whether now or hereafter authorized); but any and all
shares of stock, bonds, debentures or other securities or obligations, whether
or not convertible into stock or carrying warrants entitling the holders thereof
to subscribe to stock, may be issued, sold and disposed of from time to time by
the Corporation to such persons, firms or corporations and at such price and for
such consideration as from time to time may be fixed by the Board of Directors.
13. From time to time the Board of Directors shall have the power to
determine, so far as permitted by law, whether and to what extent, and at what
time and
-6-
<PAGE> 41
place, and under what conditions and regulations, the accounts and books of the
Corporation, or any of them, shall be open to the inspection of the
stockholders, and no stockholder shall have any right to inspect any book or
account or document or the Corporation except as permitted by such regulations
or as conferred by the laws of the State of New York or as authorized by the
Board of Directors.
14. A. The Board of Directors shall have power:
(1) To authorize the determination, in accordance with accepted
accounting practice, of what constitutes annual or other net profits,
and the net asset value and redemption value (as defined herein) of
the shares of the Corporation; from time to time to fix and vary the
amount to be reserved as working capital; to set apart out of any
surplus of the Corporation such reserves in such amounts and for such
proper purposes as it shall determine and to abolish any such reserves
or any part thereof; to determine, from time to time, the withdrawal
charge, if any, to be imposed on the repurchase of its shares,
pursuant to paragraph C of this Article 14. Such withdrawal charge
shall not exceed 2% of the repurchase price, apart from such charge.
(2) To authorize the issuance and sale from time to time, of
shares of Common Stock of the Corporation, including Treasury shares,
at such price or prices which shall be not less than par value and
upon such terms and conditions as from time to time may be fixed by
the Board of Directors. Any and all shares of Common Stock of the
Corporation issued in accordance with the terms so determined by the
Board of Directors shall be deemed fully paid and not liable to any
further call or assessment thereon.
(3) To declare and pay dividends out of surplus or other funds,
if any, legally available therefor in such amounts, in such manner,
and to the stockholders of record, as of such date as the Board of
Directors may from time to time determine, pursuant to Sec. 62 of the
Stock Corporation Law.
(4) To authorize, upon such terms and conditions as the Board of
Directors may from time to time determine, the execution, even though
some or all of the directors and officers of the Corporation are
directors, or officers, employees, stockholders or otherwise
interested in the person or persons with whom the Corporation
contracts, of a contract or contracts, which may be exclusive,
providing for the following:
a. The furnishing of statistical, research, clerical and
bookkeeping services;
b. The distribution of its shares by a distributor;
-7-
<PAGE> 42
c. One or more custodians of the funds or securities,
or both, of the Corporation; and/or
d. A transfer agent or a registrar, or both, of its
shares;
e. The furnishing of investment advice and
information.
B. The directors of the Corporation may receive
compensation for their services, subject, however, to such limitations with
respect thereto as may be determined from time to time by the stockholders. The
Corporation, acting by the Board of Directors, may adopt a plan for
compensation to officers and employees of the Corporation based in whole or in
part upon the net earnings of the Corporation, but nothing therein contained
shall be construed as limiting the authority of the Board of Directors to
authorize or make distribution to officers and employees of salaries, wages or
special compensation irrespective of the earnings of the Corporation.
C. The holders of shares of the Corporation, subject to
the provisions hereinafter set forth, shall be entitled on any business day,
upon request, accompanied by surrender of the certificates for any or all of
such shares held by them, to cause the shares so surrendered to be repurchased
by the Corporation, subject to New York law out of surplus and subject to such
reasonable regulations, not inconsistent with the provisions of this
Certificate of Incorporation, as may be adopted from time to time by the Board
of Directors. Such repurchases shall be made and the repurchase price
determined and paid as follows:
(1) There shall be tendered to the Corporation or to
a person, firm or corporation, designated for the purpose by the
Corporation, during such usual business hours on a business day as the
Board of Directors may designate:
a. The certificates representing the shares to be
repurchased, in satisfactory form for transfer to the
Corporation or endorsed in blank, as the Corporation may
request, together with such proof of ownership, power to
surrender and of the authenticity of signatures as may be
required by the Corporation and with necessary stock transfer
tax stamps; and
b. A request for the repurchase of such shares in
form acceptable to the Corporation.
Such tender shall be irrevocable and the Corporation or person, firm or
corporation, designated for the purpose shall, except as provided in
paragraph (4) of this paragraph C, receive and accept such documents
and repurchase such shares in the manner herein provided for.
-8-
<PAGE> 43
(2) The repurchase price, per share, to be paid by
the Corporation shall be the redemption value, per share, of the shares
to be repurchased less such withdrawal charge, if any, as may be fixed
by the Board of Directors pursuant to paragraph (1) of paragraph A of
this Article 14. Such redemption value, per share, shall be the net
asset value as determined as of the time of closing of the New York
Stock Exchange next following proper tender and acceptance, pursuant to
paragraph (1) of this paragraph C, except that as to shares properly
tendered and accepted after 12 noon, New York time, the net asset value
will be as determined as of 12 noon on the trading day next following.
Such price, per share, if resulting in a fraction of a cent, shall be
adjusted to the next lower whole cent.
(3) Payment of the repurchase price shall be made at
such time and in such manner as may be determined by the Board of
Directors to be in the best interests of the Corporation and may be
made either in cash or in kind or partly in cash and partly in kind. In
making any such payment in cash or in kind such securities shall be
valued in the same manner employed in determining the amount of the
repurchase price and the securities so distributed shall be selected in
such manner as the Board of Directors may deem fair and equitable.
(4) The right of redemption may be suspended for a
period of not more than seven days; provided, however, that such right
may be suspended for any period during which the New York Stock
Exchange is closed or trading thereon is restricted, for any period
during which an emergency exists as a result of which it is impractical
for the Corporation to determine the value of its assets or to dispose
thereof, or for any such period as may be permitted by law.
(5) The right of a holder of shares to receive
dividends thereon, and all other rights with respect to such shares,
shall forthwith cease and terminate from and after the time of the
acceptance of such shares by the Corporation for repurchase, except the
right of such holder to receive, in cash or in kind or partly in cash
and partly in kind, the repurchase price of such shares from the
Corporation or, if such repurchase price has been deposited with a
custodian of the Corporation in trust for such holder and notice
thereof has been mailed to him, at his address as the same appears on
the books of the Corporation, from such custodian.
D. The Board of Directors is hereby empowered to
authorize the purchase of shares of the Corporation in the open market or
otherwise at prices not in excess
-9-
<PAGE> 44
of their net asset value, determined by the net asset value used at the time
such shares are purchased in the calculation of the current public offering
price of shares of the Corporation, and to take all other steps deemed necessary
or advisable in connection therewith.
E. Any vote authorizing liquidation of the Corporation or proceedings
for its dissolution may authorize the Board of Directors to determine the value
of assets and may divide, or authorize the Board of Directors to divide, such
assets among the stockholders in such manner that every stockholder will receive
his pro rata share of the assets of the Corporation, either in cash or in
property, or partly in cash and partly in property, as the Board of Directors
may determine, upon such liquidation or dissolution.
F. The Corporation reserves the right to take any lawful action and to
make any amendment of this Certificate of Incorporation, including the right to
make any amendment which changes the terms of any shares of the Corporation of
any class now or hereafter authorized by classification, reclassification or
otherwise, and to make any amendment of this Certificate of Incorporation in any
form, manner or substance now or hereafter authorized or permitted by law.
Nothing contained in this subdivision shall be deemed to limit or restrict the
Corporation in the full and proper use and enjoyment of its purposes, objects
and powers, or otherwise, as now or hereafter set forth in this Certificate of
Incorporation or any amendment hereof hereafter in force, or as now or hereafter
authorized or permitted by law. All holders of shares of the Corporation by
acceptance of the certificate or certificates representing their shares agree
that all rights to which such shares entitle them are subject to the foregoing
provisions of this subdivision and all other provisions of this Certificate of
Incorporation from the time of the issuance thereof.
15. As used in this Certificate of Incorporation, the following terms
shall have the meanings indicated:
"Person" shall mean a natural person, corporation, joint stock
company, association, partnership, trust or syndicate.
"Net asset value" and "redemption value" of any share of the
Corporation outstanding (exclusive of treasury stock) shall be determined by, or
pursuant to, the direction of the Board of Directors, in accordance with the
following paragraphs A to C inclusive.
A. Net asset value shall be determined by dividing:
(1) The total value of the assets of the Corporation determined as
provided in paragraph C below (except that there may be added to the market
value of all securities
-10-
<PAGE> 45
shall be not less than the last bid price nor more than the last asked
price for such security on either of said exchanges on such date.
(2) The market value of each security which shall not be listed or
traded in on the New York Stock Exchange or the New York Curb Exchange
shall be determined by any quotation or method approved by or pursuant to
the direction of the Board of Directors.
(3) Dividends declared but not yet received and rights, in respect of
securities which are quoted ex-dividend or ex-rights, shall be included at
the fair value thereof as determined by or pursuant to the direction of the
Board of Directors which may, but need not, be the fair value so determined
on the day the particular securities are first quoted ex-dividend or
ex-rights.
(4) The fair value of any other assets of the Corporation (or the value
of any of the assets mentioned in (1), (2) or (3) of this paragraph C in
situations not covered thereby, or, in the event of the closing of the New
York Stock Exchange or any other happening determined by the Board of
Directors in their discretion to make other method of valuation advisable)
shall be determined in accordance with accepted accounting practice in such
manner as may be approved from time to time by or pursuant to the direction
of the Board of Directors.
16. (a) Each Director, officer and employee of the Corporation shall be
indemnified by the Corporation against reasonable expenses, including attorneys'
fees, actually and necessarily incurred by him in connection with the defense of
any action, suit or proceeding, or in connection with any appeal therein, in
which he is made a party by reason of his being, or having been, a director,
officer or employee of the Corporation, except in relation to matters as to
which he shall be adjudged in such action, suit or proceeding to be liable for
negligence or misconduct in the performance of his duties as such Director,
officer or employee; such indemnification shall not, however, protect any
director or officer of the Corporation against any liability to the Corporation
or to its security holders to which he would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office. Such right of indemnification
shall not be deemed exclusive of any other rights to which he may be entitled
under any By-Law, agreement, vote of stockholder or otherwise.
(b) No contract or transaction entered into by the Corporation shall be
invalidated by reason of the fact that any director of the Corporation is a
-12-
<PAGE> 46
party to such contract or transaction or is in any way interested or connected
with any charge to such contract or transaction, provided such interest or
connection be disclosed to the Board of Directors.
IN WITNESS WHEREOF, we do make, subscribe and acknowledge this
Certificate.
Dated: New York, New York
December 14, 1951.
/s/ Hiram G. Shields
--------------------
/s/ Albert L. Haas
--------------------
/s/ Julius A. Levine
--------------------
/s/ S. Spencer Grean
--------------------
<PAGE> 47
STATE OF NEW YORK )
) ss.
COUNTY OF NEW YORK )
On this 14 day of December, 1951, before me personally appeared HIRAM
G. SHIELDS, ALBERT L. HAAS, JULIUS A. LEVINE and S. SPENCER GREAN, to me known
and known to me to be the individuals described in the foregoing instrument,
and they duly and severally acknowledged to me that they executed the same.
/s/ Harold W. Grubart
---------------------
<PAGE> 48
CERTIFICATE OF INCORPORATION
OF
SPENCER GREAN FUND, INC.
Pursuant to Article Two
of the Stock Corporation Law.
GORDON, BRADY, CAPPREY & KELLER
80 PINE STREET, NEW YORK, N.Y.
<PAGE> 49
CERTIFICATE OF CHANGE
OF
THE HERITAGE FUND, INC.
Under Section 805A of the Business Corporation Law
Pursuant to the provisions of Section 805A of the Business Corporation
Law, the undersigned hereby certify:
FIRST: That the name of the corporation is The Heritage Fund, Inc., and
that it was originally incorporated under the name "Spencer Grean Fund, Inc."
SECOND: That the Certificate of Incorporation of the corporation was
filed by the Department of State, Albany, New York, on the 28th day of December
1951.
THIRD: That the change to the Certificate of Incorporation effected by
this Certificate is as follows:
To change the post office address to which the Secretary of State shall
mail a copy of any process against the corporation served upon him, so
that such address shall hereafter be "120 Broadway, Borough of Manhattan,
New York, New York."
FOURTH: That the change of the Certificate of Incorporation was
authorized by the vote of a majority of directors present at a meeting of the
Board at which a quorum was present.
<PAGE> 50
IN WITNESS WHEREOF, this Certificate has been signed this 8th day of
August, 1966.
THE HERITAGE FUND, INC.
/s/ Bassett S. Winmill
---------------------------------
Bassett S. Winmill
President
/s/ John W. Hurley
---------------------------------
John W. Hurley
Secretary
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
Bassett S. Winmill, being duly sworn, deposes and says that he is the
President of The Heritage Fund, Inc., the corporation mentioned and described in
the foregoing instrument; that he has read and signed the same and that the
statements contained therein are true.
/s/ Bassett S. Winmill
---------------------------------
Sworn to before me this
8th day of August, 1966
/s/ [Illegible Signature]
- ---------------------------------
-2-
<PAGE> 51
CERTIFICATE OF CHANGE
OF
THE HERITAGE FUND, INC.
UNDER SECTION 805A OF THE
BUSINESS CORPORATION LAW
* * * * * * * * * * * * * * * * *
Debevoise Plimpton Lyons & Gates
320 Park Avenue
New York, New York
<PAGE> 52
CERTIFICATE OF CHANGE
OF
THE HERITAGE FUND, INC.
UNDER SECTION 805A OF THE
BUSINESS CORPORATION LAW
* * * * * * * * * * * * * * * * *
Debevoise Plimpton Lyons & Gates
320 Park Avenue
New York, New York
<PAGE> 53
CERTIFICATE OF CHANGE
OF
THE AMERICAN HERITAGE FUND, INC.
__________________________
Under Section 805-A of the Business Corporation Law
__________________________
Pursuant to the provisions of Section 805-A of the Business
Corporation Law, the undersigned hereby certifies:
FIRST: That the name of the corporation is The American Heritage
Fund, Inc. and that it was originally formed under the name "Spencer Grean Fund,
Inc."
SECOND: That the Certificate of Incorporation of the corporation was
filed with the Department of State on the 28th day of December, 1951.
THIRD: That the Certificate of Incorporation is changed to change
the post office address to which the Secretary of state shall mail a copy of any
process against the corporation served upon him, so that such address shall
hereafter be 31 West 52nd Street, New York, New York 10019.
FOURTH: That the change of the Certificate of Incorporation was
authorized by the vote of a majority of directors present at a meeting of the
Board of Directors at which a quorum was present.
1
<PAGE> 54
IN WITNESS WHEREOF, this Certificate of Change has been signed this 27 day
of February, 1990.
THE AMERICAN HERITAGE FUND, INC.
By: /s/ Richard K. Parker
-----------------------------
Richard K. Parker, President
And By: /s/ Heiko H. Thieme
-----------------------------
Heiko H. Thieme, Secretary
STATE OF NEW YORK )
: SS:
COUNTY OF NEW YORK)
Richard K. Parker, being first duly sworn, deposes and says that he is the
President of The American Heritage Fund, Inc., the corporation mentioned and
described in the foregoing instrument; that he has read and signed the same and
that the statements contained therein are true.
/s/ Richard K. Parker
-----------------------------
Richard K. Parker
SWORN TO AND SUBSCRIBED
BEFORE ME THIS 28 DAY
OF FEBRUARY, 1990.
/s/ Ronald M. Berman
- -----------------------
NOTARY PUBLIC
My commission expires:
2
<PAGE> 55
Certificate of Change
of
The American Heritage Fund, Inc.
Under Section 805 a of the Business
Corporation Law
Reisman & Associates, P.A.
Suite 501
3225 Aviation Ave.
Miami, Fla 33133
Attn: Jonathan B. Reisman
<PAGE> 56
----------------------------
NYS DEPARTMENT OF STATE - DIVISION OF CORPORATIONS FILING PERIOD FEE
STATEMENT OF ADDRESSES AND DIRECTORS, PART A 83065 12/1992 $50.00
----------------------------
CORPORATION NAME
- ----------------
THE AMERICAN HERITAGE FUND, INC.
- --------------------------------------------------------------------------------
1. FARM [ ] The corporation is a corporation engaged in the production
CORPORATION of crops, livestock, and livestock products on land used in
agricultural production (Agriculture and Markets Law Section
301). It is not required to report.
- --------------------------------------------------------------------------------
2. NAME
NAME AND Heiko Thieme
BUSINESS ----------------------------------------------------------------
ADDRESS OF ADDRESS
THE CHAIRMAN 32 West 52nd Street
OF THE BOARD ----------------------------------------------------------------
OF DIRECTORS CITY STATE ZIP + 4
New York NY NY 10019
- --------------------------------------------------------------------------------
3. NAME
ADDRESS OF Richard K. Parker
THE PRINCIPAL ----------------------------------------------------------------
EXECUTIVE ADDRESS
OFFICE 32 West 52nd Street
----------------------------------------------------------------
CITY STATE ZIP + 4
New York NY NY 10019
- --------------------------------------------------------------------------------
4. NAME
SERVICE OF The American Heritage Fund Inc.
PROCESS ----------------------------------------------------------------
ADDRESS ADDRESS
32 West 52nd Street
----------------------------------------------------------------
CITY STATE ZIP + 4
New York NY 10019
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
----------------------------
NYS DEPARTMENT OF STATE - DIVISION OF CORPORATIONS FILING PERIOD FEE
STATEMENT OF ADDRESSES AND DIRECTORS, PART B 83065 12/1992 $50.00
----------------------------
CORPORATION NAME
- ----------------
THE AMERICAN HERITAGE FUND, INC.
(1) NAME AND BUSINESS ADDRESS OF THE CHAIRMAN OF THE BOARD OF DIRECTORS
-------------------------------------------------------------------
NO ADDRESS ON FILE
(2) ADDRESS OF THE PRINCIPAL EXECUTIVE OFFICE
-----------------------------------------
NO ADDRESS ON FILE
(3) SERVICE OF PROCESS ADDRESS
--------------------------
THE AMERICAN HERITAGE FUND, INC.
31 WEST 52ND STREET
NEW YORK, NY 10019
AR921229002245
MAKE NO MARKS BELOW THIS LINE (PLEASE SIGN AND DATE ON REVERSE) DOS-1157 (8/92)
- --------------------------------------------------------------------------------
0199212 300083065 305000
<PAGE> 57
IMPORTANT NOTICE
AR921229002245
A New York Corporation which is no longer conducting business should file a
Certificate of Dissolution pursuant to section 1003 of the Business Corporation
Law, and a foreign corporation no longer conducting business in New York State
should file a Surrender of Authority pursuant to section 1310 or a Termination
of Existence pursuant to Section 1311 of the Business Corporation Law.
An inactive corporation continues to accrue tax liability and possible interest
and penalties until formally dissolved, surrendered, or terminated.
Questions regarding the filing of these certificates should be directed to the
NYS Department of State, Division of Corporations, 162 Washington Avenue,
Albany, NY 12231-0001 or by calling 518-473-2492. You are also advised to
request Publication 110, "Information and Instructions for Termination of
Business Corporations" from the Department of Taxation and Finance. Requests
for this publication and questions regarding taxation issues should be sent
to the NYS Department of Taxation and Finance, Processing and Revenue
Management Division, Dissolution Unit, Building 8, Room 302, W.A. Harriman
Campus, Albany, NY 12227.
------------------------------------------
Filing Period and Penalty - the filing period is the calendar month during
which the original certificate of incorporation or application for authority
was filed or the effective date that corporate existence began, if stated in
the certificate of incorporation. Failure to timely file this statement will
be reflected in the department's records as past due or delinquent and may
later subject the corporation to a fine of $250. See section 409 of the
Business Corporation Law.
Filing Fee: The statutory filing fee is $50. Checks and money orders must be
made payable to the "Department of State." DO NOT mail cash.
Send entire form, completed, and with $50.00 fee, in the self-mailer envelope,
to the Department of State, Division of Corporations, 162 Washington Avenue,
Albany, NY 12231-0002.
- --------------------------------------------------------------------------------
STATEMENT OF ADDRESSES AND DIRECTORS, PART C
IN WITNESS WHEREOF, this certificate has been subscribed this 8th day of
Dec. 1992, by the undersigned who affirms that the statements made herein
are true under the penalties of perjury.
Heiko Thieme /s/ Heiko Thieme
---------------------------- -----------------------------
PRINT OR TYPE NAME SIGNATURE
Chairman of the Board
----------------------------
PRINT OR TYPE TITLE
STATE OF NEW YORK
DEPARTMENT OF STATE
FILED DEC 29 1992
BY: /s/ CB
-------------------
MAKE NO MARKS BELOW THIS LINE 921229002244
- --------------------------------------------------------------------------------
<PAGE> 1
Exhibit (b)
THE AMERICAN HERITAGE FUND, INC.
----------------------------------
* * * * * *
BY-LAWS, AS AMENDED
* * * * * *
ARTICLE I
OFFICES
Section 1. The office of the corporation shall be located in the State of
New York or such other location as may be determined by the Board of Directors.
Section 2. The corporation may also have offices at such other places
both within and without the State of New York as the board of directors may
from time to time determine or the business of the corporation may require.
ARTICLE II
ANNUAL MEETINGS OF SHAREHOLDERS
Section 1. All meetings of shareholders for the election of directors
shall be held in Menlo Park, State of California or at such place as may be
fixed from time to time by the board of directors.
Section 2. Annual meetings of shareholders, commencing with the year
1977, shall be held on the 20th day of September, if not a legal holiday, and
if a legal holiday,
<PAGE> 2
then on the next secular day following, at 2:30 P. M., at which they shall
elect by a plurality vote, a board of directors, and transact such other
business as may properly be brought before the meeting.
Section 3. Written or printed notice of the annual meeting, stating the
place, date and hour of the meeting, shall be delivered not less than ten nor
more than fifty days before the date of the meeting, either personally or by
mail, by, or at the direction of the president, the secretary, or the officer
or persons calling the meeting, to each shareholder of record entitled to vote
at such meeting.
ARTICLE III
SPECIAL MEETINGS OF SHAREHOLDERS
Section 1. Special meetings of shareholders may be held at such time and
place within or without the State of New York as shall be stated in the notice
of the meeting or in a duly executed waiver of notice thereof.
Section 2. Special meetings of the shareholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the certificate of
incorporation, may be called by the president, the board of directors, or the
holders of not less than 51% of all the shares entitled to vote at the meeting.
Section 3. Written or printed notice of a special
-2-
<PAGE> 3
meeting stating the place, date and hour of the meeting and the purpose or
purposes for which the meeting is called, shall be delivered not less than ten
nor more than fifty days before the date of the meeting, either personally or by
mail, by, or at the direction of, the president, the secretary, or the officer
or persons calling the meeting, to each shareholder of record entitled to vote
at such meeting. The notice should also indicate that it is being issued by, or
at the direction of, the person calling the meeting.
Section 4. The business transacted at any special meeting of shareholders
shall be limited to the purposes stated in the notice.
ARTICLE IV
QUORUM AND VOTING OF STOCK
Section 1. The holders of a majority of the shares of stock issued and
outstanding and entitled to vote, represented in person or by proxy, shall
constitute a quorum at all meetings of the shareholders for the transaction of
business except as otherwise provided by statute or by the certificate of
incorporation. If, however, such quorum shall not be present or represented at
any meeting of the shareholders, the shareholders present in person or
represented by proxy shall have power to adjourn the meeting from time to time,
without notice other than announcement at the meeting, until
-3-
<PAGE> 4
a quorum shall be present or represented. At such adjourned meeting at which a
quorum shall be present or represented any business may be transacted which
might have been transacted at the meeting as originally notified.
Section 2. If a quorum is present, the affirmative vote of a majority of
the shares of stock represented at the meeting shall be the act of the
shareholders, unless the vote of a greater or lesser number of shares of stock
is required by law or the certificate of incorporation.
Section 3. Each outstanding share of stock having voting power shall be
entitled to one vote on each matter submitted to a vote at a meeting of
shareholders. A shareholder may vote either in person or by proxy executed in
writing by the shareholder or by his duly authorized attorney-in-fact.
Section 4. The board of directors in advance of any shareholders' meeting
may appoint one or more inspectors to act at the meeting or any adjournment
thereof. If inspectors are not so appointed, the person presiding at a
shareholders' meeting may, and, on the request of any shareholder entitled to
vote thereat, shall appoint one or more inspectors. In case any person appointed
as inspector fails to appear or act, the vacancy may be filled by the board in
advance of the meeting or at the meeting by the person presiding thereat. Each
inspector, before entering upon the discharge of his duties, shall take and sign
an oath faithfully to execute the duties of inspector at such meeting with
strict impartiality
-4-
<PAGE> 5
and according to the best of his ability.
Section 5. Whenever shareholders are required or permitted to take any
action by vote, such action may be taken without a meeting on written consent,
setting forth the action so taken, signed by the holders of all outstanding
shares entitled to vote thereon.
ARTICLE V
DIRECTORS
Section 1. The number of directors shall be five Directors shall be at
least eighteen years of age and need not be residents of the State of New York
nor shareholders of the corporation. The directors, other than the first board
of directors, shall be elected at the annual meeting of the shareholders, except
as hereinafter provided, and each director elected shall serve until the next
succeeding annual meeting and until his successor shall have been elected and
qualified. The first board of directors shall hold office until the first annual
meeting of shareholders.
Section 2. Any or all of the directors may be removed, with or without
cause, at any time by the vote of the shareholders at a special meeting called
for that purpose.
Any director may be removed for cause by the action of the directors at a
special meeting called for that purpose.
Section 3. Unless otherwise provided in the certificate of incorporation,
newly created directorships resulting
-5-
<PAGE> 6
from an increase in the board of directors and all vacancies occurring in the
board of directors, including vacancies caused by removal without cause, may
be filled by the affirmative vote of a majority of the board of directors,
however, if the number of directors then in office is less than a quorum then
such newly created directorships and vacancies may be filled by a vote of a
majority of the directors then in office. A director elected to fill a vacancy
shall hold office until the next meeting of shareholders at which election of
directors is the regular order of business, and until his successor shall have
been elected and qualified. A director elected to fill a newly created
directorship shall serve until the next succeeding annual meeting of
shareholders and until his successor shall have been elected and qualified.
Section 4. The business affairs of the corporation shall be managed by its
board of directors which may exercise all such powers of the corporation and do
all such lawful acts and things as are not by statute or by the certificate of
incorporation or by these by-laws directed or required to be exercised or done
by the shareholders.
Section 5. The directors may keep the books of the corporation, except such
as are required by law to be kept within the state, outside the State of New
York, at such place or places as they may from time to time determine.
Section 6. The board of directors, by the affirmative vote of a majority of
the directors then in office, and irrespective of any personal interest of any
of its members,
-6-
<PAGE> 7
shall have authority to establish reasonable compensation of all directors for
services to the corporation as directors, officers or otherwise
ARTICLE VI
MEETINGS OF THE BOARD OF DIRECTORS
Section 1. Meetings of the board of directors, regular or special, may be
held either within or without the State of New York.
Section 2. The first meeting of each newly elected board of directors shall
be held at such time and place as shall be fixed by the president or secretary.
Section 3. Regular meetings of the board of directors may be held upon such
notice, or without notice, and at such time and at such place as shall from time
to time be determined by the board.
Section 4. Special Meetings of the Board of Directors may be called by the
president on one day's notice to each director, either personally or by
telecopier, provided the receipt of the telecopy is telephonically verified, or
four day's notice if by mail; special meetings may be called by the chief
executive officer or secretary in like manner and on like notice on the written
request of two directors. Notwithstanding the foregoing, special meetings for
the purpose of (a) questioning or overriding any action or inaction of the
Valuation Committee, (b) changing the membership of the Valuation Committee, or
(c) abolishing the Valuation Committee may be called by any director on one
hour's notice to each other director, either personally or by telephone or by
telecopier, provided the receipt of the telecopy is telephonically verified.
Section 5. Notice of a meeting need not be given to any director who
submits a signed waiver of notice whether before or after the meeting, or who
attends the meeting without protesting, prior thereto or at its commencement,
the lack
-7-
<PAGE> 8
of notice. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the board of directors need be specified in the
notice or waiver of notice of such meeting.
Section 6. A majority of the directors shall constitute a quorum for the
transaction of business unless a greater or lesser number is required by law or
by the certificate of incorporation. The vote of a majority of the directors
present at any meeting at which a quorum is present shall be the act of the
board of directors, unless the vote of a greater number is required by law or by
the certificate of incorporation. If a quorum shall not be present at any
meeting of directors, the directors present may adjourn the meeting from time to
time without notice other than announcement at the meeting, until a quorum shall
be present.
Section 7. Unless the certificate of incorporation provides otherwise, any
action required or permitted to be taken at a meeting of the directors or a
committee thereof may be taken without a meeting, if a consent in writing to the
adoption of a resolution authorizing the action so taken, shall be signed by all
of the directors entitled to vote with respect to the subject matter thereof.
Section 8. Unless otherwise restricted by the certificate of incorporation
or these by-laws, members of the board of directors, or any committee designated
by the board of directors may participate in a meeting of the board of
directors, or any committee, by means of conference telephone or similar
communications equipment by means of which all persons participating
-8-
<PAGE> 9
'in the meeting can hear each other and such participation in a meeting shall
constitute presence in person at the meeting.
ARTICLE VII
EXECUTIVE COMMITTEE
Section 1. The board of directors, by resolution adopted by a majority of
the entire board may designate, from among its members, an executive committee
and other committees, each consisting of three or more directors and each of
which, to the extent provided in the resolution shall have all the authority of
the board, except as otherwise required by law. Vacancies in the membership of
the committee shall be filled by the board of directors at a regular or special
meeting of the board of directors. The executive committee shall keep regular
minutes of its proceedings and report the same to the board when required.
ARTICLE VIII
NOTICES
Section 1. Whenever, under the provisions of the statutes or of the
certificate of incorporation or of these by-laws, notice is required to be given
to any director or shareholder, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
director or shareholder, at his address as it appears on the records of the
corporation, with postage thereon prepaid, and such notice shall be deemed to be
given at the time when the same shall be deposited in the United States mail.
Notice to directors may also be given by telegram.
-9-
<PAGE> 10
Section 2. Whenever any notice of a meeting is required to be given under
the provisions of the statutes or under the provisions of the certificate of
incorporation or these by-laws, a waiver thereof in writing, signed by the
person or persons entitled to such notice, whether before or after the time
stated therein, shall be deemed equivalent to the giving of such notice.
ARTICLE IX
OFFICERS
Section 1. The officers of the corporation shall be chosen by the board of
directors and shall be a president, a vice-president, a secretary and a
treasurer. The board of directors may also choose additional vice-presidents and
one or more assistant secretaries and assistant treasurers.
Section 2. The board of directors at its first meeting after each annual
meeting of shareholders shall choose a president from among the directors and
shall choose one or more vice-presidents, a secretary and a treasurer, none of
whom need be a member of the board.
Any two or more offices may be held by the same person, except the offices
of president and secretary. When all the issued and outstanding stock of the
corporation is owned by one person, such person may hold all or any combination
of offices.
Section 3. The board of directors may appoint such other officers and
agents as it shall deem necessary who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time
-10-
<PAGE> 11
to time by the board of directors.
Section 4. The salaries of all officers and agents of the corporation shall
be fixed by the board of directors.
Section 5. The officers of the corporation shall hold office until their
successors are chosen and qualify. Any officer elected or appointed by the board
of directors may be removed at any time by the affirmative vote of a majority of
the board of directors. Any vacancy occurring in any office of the corporation
shall be filled by the board of directors.
THE PRESIDENT
Section 6. The president shall be the chief executive officer of the
corporation, shall preside at all meetings of the shareholders and the board of
directors, shall have general and active management of the business of the
corporation and shall see that all orders and resolutions of the board of
directors are carried into effect.
Section 7. He shall execute bonds, mortgages and other contracts requiring
a seal under the seal of the corporation, except where required or permitted by
law to be otherwise signed and executed and except where the signing and
execution thereof shall be expressly delegated by the board of directors to some
other officer or agent of the corporation.
THE VICE-PRESIDENTS
Section 8. The vice-president or, if there shall be more than one, the
vice-presidents, in the order determined by the board of directors, shall, in
the absence or disability of the president, perform the duties and exercise the
powers of the president and shall perform such other duties and have such
-11-
<PAGE> 12
other powers as the board of directors may from time to time prescribe.
THE SECRETARY AND ASSISTANT SECRETARIES
Section 9. The secretary shall, whenever feasible, attend all meetings of
the board of directors and all meetings of the shareholders and record all the
proceedings of the meetings of the corporation and of the board of directors in
a book to be kept for that purpose and shall perform like duties for the
standing committees when required. He shall give, or cause to be given, notice
of all meetings of the shareholders and special meetings of the board of
directors, and shall perform such other duties as may be prescribed by the board
of directors or president, under whose supervision he shall be. He shall have
custody of the corporate seal of the corporation and he, or an assistant
secretary, shall have authority to affix the same to any instrument requiring it
and, when so affixed, it may be attested by his signature or by the signature of
such assistant secretary. The board of directors may give general authority to
any other officer to affix the seal of the corporation and to attest the
affixing by his signature.
Section 10. The assistant secretary or, if there be more than one, the
assistant secretaries in the order determined by the board of directors, shall,
in the absence or disability of the secretary, perform the duties and exercise
the powers of the secretary and shall perform such other duties and have such
other powers as the board of directors may from time to time prescribe.
-12-
<PAGE> 13
THE TREASURER AND ASSISTANT TREASURERS
Section 11. The treasurer or his designee shall have the custody of the
corporate funds and securities and shall keep full and accurate accounts of
receipts and disbursements in books belonging to the corporation and shall
deposit all moneys and other valuable effects in the name and to the credit of
the corporation in such depositories as may be designated by the board of
directors.
Section 12. He shall disburse the funds of the corporation as may be
ordered by the board of directors, taking proper vouchers for such
disbursements, and shall render to the president and the board of directors at
its regular meetings, or when the board of directors so requires, an account of
all his transactions as treasurer and of the financial condition of the
corporation.
Section 13. If required by the board of directors, he shall give the
corporation a bond in such sum and with such surety or sureties as shall be
satisfactory to the board of directors for the faithful performance of the
duties of his office and for the restoration to the corporation, in case of his
death, resignation, retirement or removal from office, of all books, papers,
vouchers, money and other property of whatever kind in his possession or under
his control belonging to the corporation.
Section 14. The assistant treasurer, or, if there shall be more than one,
the assistant treasurers in the order determined by the board of directors,
shall, in the absence or disability of the treasurer, perform the duties and
exercise the powers of the treasurer and shall perform such
-13-
<PAGE> 14
other duties and have such other powers as the board of directors may, from time
to time, prescribe.
ARTICLE X
CERTIFICATES FOR SHARES
Section 1. The shares of the corporation shall be represented by
certificates signed by the chairman or vice chairman of the board or the
president or a vice-president and the secretary or an assistant secretary or the
treasurer or an assistant treasurer of the corporation and may be sealed with
the seal of the corporation or a facsimile thereof.
When the corporation is authorized to issue shares of more than one class
there shall be set forth upon the face or back of the certificate, or the
certificate shall have a statement that the corporation will furnish to any
shareholder upon request and without charge, a full statement of the
designation, relative rights, preferences and limitations of the shares of each
class authorized to be issued and, if the corporation is authorized to issue any
class of preferred shares in series, the designation, relative rights,
preferences and limitations of each such series so far as the same have been
fixed and the authority of the board of directors to designate and fix the
relative rights, preferences and limitations of other series.
Section 2. The signatures of the officers of the corporation upon a
certificate may be facsimiles if the certificate is countersigned by a transfer
agent or registered
-14-
<PAGE> 15
by a registrar other than the corporation itself or an employee of the
corporation. In case any officer who has signed or whose facsimile signature has
been placed upon a certificate shall have ceased to be such officer before such
certificate is issued, it may be issued by the corporation with the same effect
as if he were such officer at the date of issue.
LOST CERTIFICATES
Section 3. The board of directors may direct a new certificate to be issued
in place of any certificate theretofore issued by the corporation alleged to
have been lost or destroyed. When authorizing such issue of a new certificate,
the board of directors, in its discretion and as a condition precedent to the
issuance thereof, may prescribe such terms and conditions as it deems expedient,
and may require such indemnities as it deems adequate, to protect the
corporation from any claim that may be made against it with respect to any such
certificate alleged to have been lost or destroyed.
TRANSFERS OF SHARES
Section 4. Upon surrender to the corporation or the transfer agent of the
corporation of a certificate representing shares duly endorsed or accompanied by
proper evidence of succession, assignment or authority to transfer, a new
certificate shall be issued to the person entitled thereto and the old
certificate cancelled and the transaction recorded upon the books of the
corporation.
-15-
<PAGE> 16
FIXING RECORD DATE
Section 5. For the purpose of determining shareholders entitled to notice
of or to vote at any meeting of shareholders or any adjournment thereof, or to
express consent to or dissent from any proposal without a meeting, or for the
purpose of determining shareholders entitled to receive payment of any dividend
or the allotment of any rights, or for the purpose of any other action, the
board of directors may fix, in advance, a date as the record date for any such
determination of shareholders. Such date shall not be more than fifty nor less
than ten days before the date of any meeting nor more than fifty days prior to
any other action. When a determination of shareholders of record entitled to
notice of or to vote at any meeting of shareholders has been made as provided in
this section, such determination shall apply to any adjournment thereof, unless
the board fixes a new record date for the adjourned meeting.
REGISTERED SHAREHOLDERS
Section 6. The corporation shall be entitled to recognize the exclusive
right of a person registered on its books as the owner of shares to receive
dividends, and to vote as such owner, and to hold liable for calls and
assessments a person registered on its books as the owner of shares, and shall
not be bound to recognize any equitable or other claims to or interest in such
share or shares on the part of any other person, whether or not it shall have
express or other notice thereof, except as otherwise provided by the
-16-
<PAGE> 17
laws of New York.
LIST OF SHAREHOLDERS
Section 7. A list of shareholders as of the record date, certified by the
corporate officer responsible for its preparation or by a transfer agent, shall
be produced at any meeting upon the request thereat or prior thereto of any
shareholder. If the right to vote at any meeting is challenged, the inspectors
of election, or person presiding thereat, shall require such list of
shareholders to be produced as evidence of the right of the persons challenged
to vote at such meeting and all persons who appear from such list to be
shareholders entitled to vote thereat may vote at such meeting.
ARTICLE XI
GENERAL PROVISIONS
DIVIDENDS
Section 1. Subject to the provisions of the certificate of incorporation
relating thereto, if any, dividends may be declared by the board of directors at
any regular or special meeting, pursuant to law. Dividends may be paid in cash,
in shares of the capital stock or in the corporation's bonds or its property,
including the shares or bonds of other corporations subject to any provisions of
law and of the certificate of incorporation.
Section 2. Before payment of any dividend, there may be set aside out of
any funds of the corporation available for dividends such sum or sums as the
directors from
-17-
<PAGE> 18
time to time, if their absolute descretion, think proper as
a reserve fund to meet contingencies, or for equalizing
dividends, or for repairing or maintaining any property of
the corporation, or for such other purpose as the directors
shall think conducive to the interest of the corporation,
and the directors may modify or abolish any such reserve in
the manner in which it was created.
CHECKS
Section 3. All checks or demands for money and
notes of the corporation shall be signed by such officer or
officers or such other person or persons as the board of
directors may from time to time designate.
FISCAL YEAR
Section 4. The fiscal year of the corporation
shall be fixed by resolution of the board of directors.
SEAL
Section 5. The corporate seal shall have inscribed thereon the name of the
corporation, the year of its organization and the words "Corporate Seal, New
York". The seal may be used by causing it or a facsimile thereof to be impressed
or Affixed or in any manner reproduced.
INDEMNIFICATION
Section 6. All officers, directors and employees shall be indemnified
against reasonable expenses, including attorney's fees in connection with the
defense of any action or an appeal therefrom to the full extent permitted under
the Business Corporation Law of New York.
-18-
<PAGE> 19
FEDERAL SECURITIES LAWS
Section 7. The provisions of these by-laws shall be subject to any
applicable provision of any federal securities law or any rule promulgated
thereunder.
ARTICLE XII
AMENDMENTS
Section 1. These by-laws may be amended or repealed or new by-laws may be
adopted at any regular or special meeting of shareholders at which a quorum is
present or represented, by the vote of the holders of shares entitled to vote in
the election of any directors, provided notice of the proposed alteration,
amendment or repeal be contained in the notice of such meeting. These by-laws
may also be amended or repealed or new by-laws may be adopted by the affirmative
vote of a majority of the board of directors at any regular or special meeting
of the board. If any by-law regulating an impending election of directors is
adopted, amended or repealed by the board, there shall be set forth in the
notice of the next meeting of shareholders for the election of directors the
by-law so adopted, amended or repealed, together with precise statement of the
changes made. By-laws adopted by the board of directors may be amended or
repealed by the shareholders.
-19-
<PAGE> 1
Exhibit (c)
{ U 3119 } { }
[EAGLE LOGO]
CAPITAL STOCK CAPITAL STOCK
THE AMERICAN HERITAGE FUND, INC.
INCORPORATED UNDER THE LAWS OF THE STATE OF NEW YORK
SEE REVERSE FOR CERTAIN DEFINITIONS
This is to Certify That is the owner of
-----------------
CUSIP 427236 10 4
-----------------
fully paid and non-assessable shares of Capital Stock of the par value of $.10
each of THE AMERICAN HERITAGE FUND, INC. (hereinafter called the
"Corporation"), transferable on the books of the Corporation by the holder
hereof in person or by duly authorized attorney, upon surrender of this
certificate properly endorsed; however, the Board of Directors may, to the
extent permitted by law, in its sole and uncontrolled discretion, upon
presentation for transfer of any certificate of stock, purchase for the
Corporation, without prior notice, the share or shares of stock represented
thereby by paying therefor in cash a sum equal to the then net asset value of
such share or shares, in accordance with the definition of the term "net asset
value" as contained in the Certificate of Incorporation. This certificate and
the shares represented hereby are issued and shall be held subject to all the
provisions of this Certificate of Incorporation of the Corporation to all of
which the holder by acceptance hereof assents.
This Certificate is not valid until countersigned by the Transfer Agent.
WITNESS the facsimile seal of the Corporation and the facsimile
signature's of its duly authorized officers.
DATED:
[SIG] [SIG]
CHAIRMAN/SECRETARY [SEAL] PRESIDENT/TREASURER
COUNTERSIGNED:
AMERICAN HERITAGE MANAGEMENT CORP.
(NEW YORK, N.Y.)
TRANSFER AGENT
BY:
----------------------------------------------------------------
AUTHORIZED OFFICER
<PAGE> 2
The following abbreviations, when used in the inscription on the face
of this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
<TABLE>
<S> <C>
TEN COM -- as tenants in common UNIF GIFT MIN ACT--.............Custodian..............
TEN ENT -- as tenants by the entireties (Cust) (Minor)
JT TEN -- as joint tenants with right under Uniform Gifts to Minors
of survivorship and not as Act..............................
tenants in common (State)
</TABLE>
Additional abbreviations may also be used though not in the above list.
For value received........................hereby sell, assign and
transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- --------------------------------------
- --------------------------------------
............................................................................
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING
POSTAL ZIP CODE OF ASSIGNEE)
............................................................................
............................................................................
......................................................................Shares
of the capital stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint
....................................................................Attorney to
transfer the said stock on the books of the within-named Corporation with full
power of substitution in the premises.
Dated..................
..................................
NOTICE: The Signature to this assignment must correspond with the name
as written upon the face of the Certificate in every particular, without
alteration or enlargement, or any change whatever.
<PAGE> 1
Exhibit (d)
THE AMERICAN HERITAGE FUND, INC.
31 WEST 52 STREET
NEW YORK, NEW YORK 10019
DECEMBER 16 , 1993
- ------------------------
AMERICAN HERITAGE MANAGEMENT CORPORATION
31 WEST 52 STREET
NEW YORK, NEW YORK 10019
INVESTMENT ADVISORY AGREEMENT
Gentlemen:
THE AMERICAN HERITAGE FUND, INC. (the "Fund") has been incorporated under
the laws of the State of New York to engage in the business of investing in
securities. It Board of Directors and shareholders have selected you to act as
the investment adviser of the Fund and to provide certain other services, as
more fully set forth below, and you are willing to act as such investment
adviser and to perform such services under the terms and conditions hereinafter
set forth. Accordingly, you and the Fund agree as follows:
1. ADVISORY SERVICES
You will regularly provide the Fund with investment research
advice and will furnish continuously an investment program for the Fund's
portfolio. You will recommend what securities shall be purchased for the
portfolio of the Fund, what portfolio securities shall be sold by the Fund and
what portion of the Fund's assets shall be held uninvested, subject always to
the provisions of the Fund's Certificate of Incorporation and By- Laws and of
the Investment Company Act of 1940, as each of the same shall be from time to
time amended, and consistent with its investment objectives as set forth in its
Registration Statement under the Investment Company Act of 1940 and the
Securities Act of 1933. You shall advise and assist the officers of the Fund in
taking such steps as are necessary or appropriate to carry out the policy
decisions of its Board of Directors and the appropriate committees of such Board
regarding the foregoing matters and the general conduct of the investment
business of the Fund. Your role is advisory only and nothing herein shall be
deemed to empower you to make any
<PAGE> 2
investment decisions for the Fund, the power to make all such decisions being
vested solely in the management of the Fund.
2. BROKERAGE
You shall render all services for the Fund in connection with
placing orders with brokers and dealers for the purchase, sale or trade of
securities held or to be acquired by the Fund. You shall place orders for the
purchase and sale of the Fund's portfolio securities in accordance with the
provisions set forth in the Fund's proxy statement or current prospectus,
whichever is the most recent.
3. OTHER SERVICES
The Fund may from time to time request that you perform other
services for the Fund. Such services may include, but are not limited to,
serving as the Fund's registrar, transfer agent and dividend disbursing agent,
performing accounting services for the Fund, keeping the Fund's books and
records that it is required to keep and computing the Fund's daily net asset
value. In performing any of these services for the Fund, you may use your
affiliates to perform these services on your behalf or contract with third
parties and have such third parties perform these services on your behalf. Any
actual expenses you incur in having any such services performed will be paid
directly by the Fund or will be reimbursed to you by the Fund.
4. ALLOCATION OF EXPENSES
The Fund shall assume all expenses required in the conduct of its
business, except as hereinafter stated. In particular, but without limiting the
generality of the foregoing, this will include payment by the Fund of the
following:
(a) compensation, expenses and fees of the Fund's officers,
directors and employees;
(b) expenses of stenographic, clerical, messenger, telephone
and other related services required in the conduct of the Fund's business;
(c) the Fund's brokers' commissions;
(d) the Fund's legal, auditing and accounting expenses;
(e) fees and disbursements of custodians of the Fund's
assets;
(f) expenses of printing, engraving and delivery of the Fund's
share certificates, including the cost of issuance of such certificates;
<PAGE> 3
(g) any other expenses relating to the redemption or repurchase
of shares of the Fund;
(h) the charges of transfer agents and registrars of the shares
of the Fund;
(i) the cost of preparing and distributing reports and notices
to the shareholders;
(j) the expense of distributing dividends;
(k) the expenses of printing and mailing prospectuses and other
materials to the Fund's existing shareholders;
(l) the expenses incident to the holding of shareholders'
meetings; and
(m) the expenses of utilities, insurance premiums and taxes or
government fees.
You will provide investment advisory research and statistical
facilities and all clerical services relating to research, statistical and
investment work.
5. COMPENSATION OF THE ADVISER
As compensation for the services rendered by you under this
Agreement, the Fund hereby agrees to pay you an annual fee at the rate of one
and one-quarter percent (1.25%) of the first $100,000,000 of average daily net
assets and one percent (1%) of any additional net assets of the Fund. The fee
shall be paid to you on the fifth business day of each calendar month for
services rendered during the preceding month.
6. LIMITATIONS OF LIABILITY OF ADVISER
You shall not be liable for any error in judgment or mistake of
law or for any loss suffered by the Fund in connection with the matters to which
this Agreement relates, except for a loss resulting from willful misfeasance,
bad faith or gross negligence on your part in the performance of your duties or
from reckless
<PAGE> 4
disregard by you of your obligations and duties under this Agreement.
7. DURATION AND TERMINATION OF THE AGREEMENT
This Agreement shall become effective upon the affirmative vote of
the holders of a majority of the outstanding voting securities of the Fund.
This Agreement shall remain in force for a period of two years
from the date it becomes effective (the "initial term"). After the initial term,
this Agreement may be renewed for additional yearly terms by the specific
approval of a majority vote of the Fund's Board of Directors, including a
majority of the Fund's Board of Directors who are not parties to this Agreement
or interested persons of any such party. The vote of the Fund's Board of
Directors to renew this Agreement shall be cast in person at a meeting called
for the purpose of voting on such approval. This Agreement may also be renewed
by a vote of the shareholders owning a majority of the Fund's outstanding voting
securities and a majority vote of the Fund's directors who are not interested
persons of the Fund cast in person at a meeting called for the purpose of voting
on such approval. This Agreement shall automatically terminate in the event of
its assignment or at any time without the payment of any penalty by the Fund's
Board of Directors or by the vote of the majority of the Fund's outstanding
voting securities on not more than 30 days notice to you. In interpreting the
provisions of this Section 7, the definitions contained in Section 2(a) of the
Investment Company Act of 1940, particularly the definitions of "interested
person", "assignment", "voting security" and "the vote of a majority of the
outstanding voting securities", shall be applied.
8. NOT EXCLUSIVE AGREEMENT
Nothing in this Agreement shall limit or restrict the right of any
of your directors, officers or employees to engage in any other business or to
devote his or her time and attention in part to the management or other aspects
of any other business, whether of a similar or dissimilar nature, nor limit or
restrict your right to engage in any other business or to render services of any
kind to any other firm, corporation, individual or association.
9. MISCELLANEOUS
The captions in this Agreement are included for convenience of
reference only and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect.
IF YOU ARE IN AGREEMENT WITH THE FOREGOING, PLEASE SIGN THE FORM OF
ACCEPTANCE ON THE ACCOMPANYING COUNTERPART OF THIS LETTER
<PAGE> 5
AND RETURN SUCH COUNTERPART TO THE FUND, WHEREUPON THIS LETTER SHALL BECOME A
BINDING CONTRACT.
Very truly yours,
THE AMERICAN HERITAGE FUND, INC.
BY: /s/RICHARD K. PARKER, DECEMBER 16, 1993
---------------------------------------------------------------------------
,
- -----------
THE FOREGOING AGREEMENT IS HEREBY ACCEPTED AND WILL BE DEEMED TO BECOME
EFFECTIVE ON THE DATE FIRST ABOVE WRITTEN IN ACCORDANCE WITH ITS TERMS.
AMERICAN HERITAGE MANAGEMENT CORPORATION
BY: /s/HEIKO H. THIEME, DECEMBER 16, 1993
---------------------------------------------------------------------------
,
- --------------
<PAGE> 1
Exhibit (g)
CUSTODIAN AGREEMENT
This Agreement, dated the 29th day of December, 1993, made by and
between The American Heritage Fund, Inc. (the Fund), a corporation operating as
an open-end investment company, duly organized under the laws of the State of
New York and Star Bank, N.A. (Star) a national banking association organized
under the laws of the United States of America.
WITNESSETH:
WHEREAS, the Fund desires to appoint Star as custodian of its Securities
and cash, and Star is willing to act in such capacity upon the terms and
conditions herein set forth; and
WHEREAS, Star in its capacity as custodian hereunder will also collect
and apply the dividends and interest on said Securities in the manner and to the
extent set forth.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto, intending to be legally bound,
do hereby agree as follows:
Section 1 . The terms as defined in this Section wherever used in this
Agreement, or in any amendment or supplement hereto, shall have the meanings
herein specified unless the context otherwise requires.
Custodian: The term Custodian shall mean Star Bank, N.A., 425 Walnut
Street, ML 5127, Cincinnati, Ohio 45202 in its capacity as custodian under this
Agreement.
Fund: The term Fund shall mean The American Heritage Fund, Inc.
Securities: The term Securities shall mean bonds, debentures, notes,
stocks, shares, evidences of indebtedness, and other securities and investments
from time to time owned by the Fund.
1
<PAGE> 2
Share Certificates: The term Share Certificates shall mean the stock
certificates for the Shares.
Shareholders: The term Shareholders shall mean the registered owners from
time to time of the Shares in accordance with the stock registry records
maintained by the duly appointed Transfer Agent of the Fund.
Shares: The term Shares shall mean the shares of common stock issued
by the Fund.
Transfer Agent: The term Transfer Agent shall mean American Data
Services, Inc., or its successor which may be appointed by the Fund.
Written Instructions From The Fund: The term Written Instructions From
The Fund shall mean an authorization, instructions, certification or approval in
form acceptable to the Custodian, signed by one or more officers of the Fund or
other signatories authorized to sign Written Instructions From the Fund by a
resolution of the Board of Directors of the Fund.
Written Instructions From The Transfer Agent: The term Written
Instructions From the Transfer Agent shall mean an authorization, instructions,
certification or approval in form acceptable to the Custodian, signed by one or
more officers of the Transfer Agent or other signatories authorized to sign
Written Instructions From The Transfer Agent by a resolution of the Board of
Directors of the Transfer Agent.
Section 2. The Fund shall from time to time file with the Custodian a
certified copy of each resolution of its Board of Directors authorizing
execution of Written Instructions From The Fund and the number of signatories
required, together with certified signatures of the officers and other
signatories authorized to sign, which shall constitute conclusive evidence of
2
<PAGE> 3
the authority of the officers and signatories designated therein to act, and
shall be considered in full force and effect with the Custodian fully protected
in acting in reliance thereon until it receives written notice to the contrary;
provided, however, that if the certifying officer is authorized to sign Written
Instructions From The Fund, the certification shall be also signed by a second
officer of the Fund.
Section 3. The Fund shall from time to time cause to be filed with the
Custodian a certified copy of each resolution of the Board of Directors of the
Transfer Agent authorizing execution of Written Instructions From The Transfer
Agent and the number of signatories required, together with certified signatures
of the officers and other signatories authorized to sign, which shall constitute
conclusive evidence of the authority of the officers and signatories designated
therein to act, and shall be considered in full force and effect with the
Custodian fully protected by the Fund in acting in reliance thereon until it
receives written notice to the contrary; provided, however, that if the
certifying officer is authorized to sign Written Instructions From The Transfer
Agent the certification shall be also signed by a second officer of the Transfer
Agent.
Section 4. The Fund hereby appoints the Custodian as custodian of the
Securities of the Fund and cash from time to time on deposit hereunder, to be
held by the Custodian and applied as provided in the Agreement. The Custodian
hereby accepts such appointment subject to the terms and conditions hereinafter
provided. Such Securities and cash shall, however, be and remain the sole
property of the Fund and the Custodian shall have only the bare custody thereof.
The Securities deposited with the Custodian shall be held either in the physical
possession of the Custodian, placed with a depository as authorized by law or
held in book-entry
3
<PAGE> 4
form by the Federal Reserve Bank. Securities may be held in the name of the
depository or the Custodian's nominee, or if directed by Written Instructions
from the Fund, in the name of the Fund or its nominee. Securities, excepting
bearer securities, delivered from time to time to the Custodian upon purchase or
otherwise shall in all cases be in due form for transfer or already registered
as above provided.
Section 5. The Fund will initially transfer and deposit or cause to be
transferred and deposited with the Custodian all of the Securities and cash
owned by the Fund at the time this Agreement becomes effective (the "Effective
Date"). The Fund will cause to be deposited with the Custodian additional
Securities as the same are purchased or otherwise acquired from time to time and
dividends or interest collected on such securities.
Thereafter the Fund will cause to be deposited with the Custodian
hereunder (i) the net proceeds of Securities sold from time to time, and (ii)
the applicable net asset value of Shares sold from time to time whether
representing initial issue, treasury stock or reinvestments of dividends and/or
distributions payable to Shareholders. Deposits with respect to sales of Shares
shall be accompanied by Written Instructions From the Transfer Agent stating the
number of Shares to be issued or reissued, the applicable net asset value per
share and the amount to be deposited with the Custodian.
Section 6. The Custodian is hereby authorized and directed to disburse
principal cash from time to time as follows:
(a) for the purpose of payment for the purchase of Securities
purchased by the Fund, upon receipt by the Custodian of both (i) Written
Instructions From the Fund specifying the Securities and stating the purchase
price, and the name of the broker, investment banker or other
4
<PAGE> 5
party to or upon whose order the purchase price is to be paid, and (ii) upon
receipt of the Securities so purchased;
(b) for the purpose of redeeming or repurchasing Shares, upon receipt of
Written Instructions From the Transfer Agent;
(c) for the purpose of exercising warrants and rights received upon the
Securities, upon timely receipt of Written Instructions from the Fund
authorizing the exercise of such warrants and rights stating the consideration
to be paid;
(d) for the purpose of repaying in whole or in part any loan of the Fund
upon receipt of Written Instructions From the Fund directing payment and
stating the Securities, if any, to be received against payment; or
(e) for the purpose of making or reimbursing the Fund for other corporate
expenditures upon receipt of Written Instructions from the Fund stating that
such expenditures were authorized by resolution of the Board of Directors of
the Fund and are or were for proper corporate purposes, and specifying the
amount of payment, the purpose of which such payment is to be made, and naming
the person or persons to whom such payment is to be made.
The Custodian will collect from time to time the interest and/or dividends
on the Securities held by it hereunder and will deposit the same in a separate
income account until disbursed as hereinafter provided.
The Custodian is authorized to advance or pay out of said income account
accrued interest on bonds purchased and dividends on stocks sold and like
items. In the event that any Securities are registered in the name of the Fund
or its nominee, the Fund will endorse to the
5
<PAGE> 6
Custodian, or cause to be endorsed, dividend and interest checks or will issue
appropriate orders to the issuers of the Securities to pay dividends and
interest to the Custodian.
Subject to proper reserves for dividends owing on stocks sold and like
items, the Custodian will disburse the money from time to time on deposit in the
income account to or upon the order of the Funds as it may from time to time
direct for the following purposes:
(a) to pay the proper compensation and expenses of the Custodian;
(b) to transfer funds to the duly designated dividend disbursing agent of
the Fund to pay dividends and/or distributions which may be declared by the
Board of Directors of the Fund upon receipt of appropriate Written Instructions
from the Fund;
(c) to pay, or provide the Fund with money to pay taxes upon receipt of
appropriate Written Instructions from the Fund; or
(d) to pay interest, management or supervisory fees, administration,
dividend and transfer and dividend disbursing agency fees and costs,
compensation of personnel, or operating expenses (including, without limitation
thereto, fees for legal, accounting and auditing services), and to disburse cash
for other proper corporate purposes. Before making any such payment or
disbursement, however, the Custodian shall receive (and may conclusively rely
upon) Written Instructions from the Fund in duplicate requesting such payment or
disbursement and stating that it is for one or more of the purposes hereinabove
enumerated, provided that if such payment or disbursement is for other proper
corporate purposes, the Written Instructions from the Fund shall state that the
payment or disbursement was authorized by resolution of the Board of Directors
of the Fund and is for a proper corporate purpose.
6
<PAGE> 7
The determination of the Board of Directors of the Fund as to what shall
constitute income derived from the Securities from time to time held hereunder
as distinguished from principal or capital, shall be final and conclusive upon
the Fund, the Custodian and the Shareholders.
The Fund hereby authorizes and directs the Custodian to transfer cash
between principal and income accounts in order to cover any overdraft in either
of said accounts.
Section 7. The Custodian is hereby authorized and directed to deliver
Securities from time to time as follows:
(a) for the purpose of completing sales of Securities sold by the Fund,
upon receipt of both (i) the net proceeds of sale and (ii) Written Instructions
from the Fund specifying the Securities sold and stating the amount to be
received and the broker, investment banker or other party to or upon whose
order the Securities are to be delivered;
(b) for the purpose of exchanging Securities or other Securities and/or
cash upon timely receipt of (i) Written Instructions from the Fund stating the
Securities to be delivered and the Securities and/or cash to be received in
exchange and the manner in which the exchange is to be made, and (ii) against
receipt of the other Securities and/or cash as specified in the Written
Instructions from the Fund;
(c) for the purpose of exchanging or converting Securities pursuant to
their terms or pursuant to any plan of conversion, consolidation,
recapitalization, reorganization, or readjustment or otherwise, upon timely
receipt of (i) Written Instructions from the Fund authorizing such exchange or
conversion and stating the manner in which such exchange or
7
<PAGE> 8
conversion is to be made, and (ii) against receipt of the Securities,
certificates of deposit, interim reports, and/or cash to be received as
specified in the Written Instructions From The Fund;
(d) for the purpose of presenting Securities for payment which have
matured or have been called for redemption;
(e) for the purpose of delivery of Securities upon redemption of Shares in
kind, upon receipt of appropriate Written Instructions From The Transfer Agent;
or
(f) for the purpose of depositing with the lender Securities to be held as
collateral of a loan to the Fund upon receipt of Written Instructions From The
Fund directing delivery to the lender.
Section 8. The Custodian assumes no duty, obligation or responsibility
whatsoever to exercise any voting or consent powers with respect to the
Securities held by it from time to time hereunder, it being understood that the
Fund, or such person or persons as it may designate, shall have the right to
vote, or consent or otherwise act with respect to such Securities. The
Custodian will furnish to the Fund proxies or other appropriate authorization
with respect to Securities registered in the name of the Custodian or its
nominee so that such voting powers, or powers to consent or otherwise act may
be exercised by the Fund or pursuant to its direction.
Section 9. The Custodian's compensation shall be as set forth in Schedule A
hereto attached, or as shall be set forth in amendments to such schedule
approved by the Fund and the Custodian.
Section 10. The Custodian shall handle, forward and/or process notices of
stockholder meetings, proxy statements, annual reports, conversion notices,
call notices, or other notices or written materials of any kind sent to the
registered owners of securities (hereinafter referred to as
8
<PAGE> 9
"notices and materials"), excluding only stock certificates and dividends and
interest payments. Upon receipt by the Custodian of warrants or rights issued in
connection with the assets of the Fund, the Custodian shall enter on its ledgers
appropriate notations indicating such receipt.
Section 11. The Custodian assumes no duty, obligation or responsibility
whatsoever with respect to Securities not deposited with the Custodian. Common
stocks or other securities exchanged for Shares shall not be considered
deposited with the Custodian until physically received and registered in the
name of the nominee of the Custodian.
Section 12. The Custodian acknowledges and agrees that all books and
records maintained by it for the Fund in any capacity under this Agreement are
the property of the Fund and may be inspected by the Fund, or any authorized
regulatory agency, at any reasonable time, and that upon request will be
surrendered promptly to the Fund.
Section 13. The Custodian assumes only the usual duties or obligations
normally performed by custodians of mutual funds. It specifically assumes no
responsibility for the management, investment or reinvestment of the Securities
from time to time owned by the Fund whether or not on deposit hereunder, it
being understood that the responsibility of said Securities shall be that of
the Fund and its investment advisors.
The Custodian shall not be liable for any taxes, assessments or
governmental charges which may be levied or assessed upon the Securities held by
it hereunder, or upon the income therefrom or otherwise whatsoever. The
Custodian may pay any such tax, assessment or charge and reimburse itself out of
the monies of the Fund or out of the Securities held hereunder; provided,
however, that the Custodian shall consult the officers of the Fund before making
any such payment.
9
<PAGE> 10
The Custodian may rely upon the advice of counsel, who may be counsel for
the Fund or for the Custodian, and upon statements of accountants, brokers and
other persons believed by it in good faith to be expert in the matters upon
which they are consulted and for any action taken or suffered in good faith
based upon such advise or statements the Custodian shall not be liable to
anyone. The Custodian shall not be liable for anything done or suffered to be
done in good faith in accordance with any request or advice of, or based upon
information furnished by, the Fund or its officers or the Transfer Agent or its
officers. The Custodian is authorized to accept a certificate of the President,
Secretary or Assistant Secretary of the Fund to the effect that a resolution in
the form submitted has been duly adopted by its Board of Directors or by the
Shareholders, as conclusive evidence that such resolution has been duly adopted
and is in full force and effect. The Custodian shall not be liable for any
action in good faith and believed to be within the powers conferred upon it by
this Agreement.
Section 14. This Agreement may be amended from time to time without
notice to or approval of the Shareholders by a supplemental agreement, in form
approved by counsel, executed by the Fund and the Custodian and amending and
supplementing this Agreement in the manner mutually agreed.
Section 15. The Custodian may terminate this Agreement within a one year
period in the event of non-payment of fees by the Fund. Thereafter, either the
Fund or the Custodian may give 90 days written notice to the other of the
termination of this Agreement, such termination to take effect at the time
specified in the notice. In case such notice of termination is given either by
the Fund or by the Custodian, the Fund shall use its best efforts to obtain a
Successor Custodian, and the Board of Directors of the Fund shall, by resolution
duly adopted, promptly
10
<PAGE> 11
appoint a Successor Custodian to serve upon the terms set forth in this
Agreement as then amended and supplemented. Each Successor Custodian shall be a
bank, trust company, or a bank and trust company in good standing, with legal
capacity to accept custody of the securities of a mutual fund, incorporated and
existing under the laws of the United States of America, or the laws of any
State having an aggregate capital surplus and undivided profits as shown by its
latest report of at least $5,000,000 and meeting all of the requirements of
Section 26 of the Investment Company Act of 1940. Upon receipt of written
notice from the Fund of the appointment of such successor and upon receipt of
Written Instructions, the Custodian shall deliver such Securities and cash as it
may then be holding hereunder directly to and only to the Successor Custodian.
Unless or until a Successor Custodian has been appointed as above provided, the
Custodian then acting shall continue to act as Custodian under this Agreement.
Every Successor Custodian appointed hereunder shall execute and deliver an
appropriate written acceptance or its appointment and shall thereupon become
vested with the rights, powers, obligation and custody of its predecessor
Custodian. The Custodian ceasing to act shall nevertheless, upon request of the
Fund and Successor Custodian and upon payment of its charges and disbursements,
execute an instrument in form approved by its counsel transferring to the
Successor Custodian all the predecessor Custodian's rights, duties, obligations
and custody.
In case the Custodian shall consolidate with or merge into any other
corporation, the corporation remaining after or resulting from such
consolidation or merger shall ipso facto, without the execution or filing of any
papers or other documents, succeed to and be substituted for the Custodian with
like effect as though originally named as such.
Section 16. The Effective Date of this Agreement shall take be January
25, 1994.
11
<PAGE> 12
Section 17. This Agreement may be executed in two or more counterparts,
each of which when so executed shall be deemed to be an original, but such
counterparts shall together constitute but one and the same instrument.
Section 18. This Agreement shall extend to and shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that this Agreement shall not be assignable by the Fund without the written
consent of the Custodian, or by the Custodian without the written consent by the
Fund, authorized or approved by a resolution of its Board of Directors.
IN WITNESS WHEREOF, the Fund and the Custodian have caused this Agreement
to be signed by their respective Presidents or Vice-Presidents and their
corporate seals hereunto duly affixed, and attested by their respective officer
as of the day and year first above written.
THE AMERICAN HERITAGE FUND, INC.
(SEAL)
By: [SIG]
--------------------------------
Attest: [SIG]
-----------------------------
STAR BANK, N.A. (SEAL)
By: /s/ NANCY V. KELLF
--------------------------------
VICE PRESIDENT AND TRUST OFFICER
Attest: /s/ LYNNETTE C. GIBSON
--------------------------------
Senior Trust Officer
12
<PAGE> 13
SCHEDULE A
STAR BANK, N.A.
CUSTODY FEE SCHEDULE
Star Bank, N.A., as Custodian, will receive monthly compensation for services
according to the terms of the following Schedule:
I. PORTFOLIO TRANSACTION FEES:
(a) For each repurchase agreement transaction $7.00
(b) For each portfolio transaction processed through
DTC or Federal Reserve $9.00
(c) For each portfolio transaction processed through
our New York custodian $25.00
(d) For each GNMA/Amortized Security Purchase $25.00
(e) For each GNMA Prin/Int Paydown, GNMA Sales $8.00
(f) For each option/future contract written,
exercised or expired $25.00
(g) For each Cedel/Euro clear transaction $80.00
(h) For each Disbursement (Fund expenses only) $5.00
A transaction is a purchase/sale of a security, free receipt/free delivery
(excludes initial conversion), maturity, tender or exchange:
II. MARKET VALUE FEE
Based upon an annual rate of: Million
.00015 (1.5 Basis Points) on Fund Balance
III. MONTHLY MINIMUM FEE-PER FUND $400.00
IV. OUT-OF-POCKET EXPENSES
The only out-of-pocket expenses charged to your account will be shipping
fees or transfer fees.
V. IRA DOCUMENTS
Per Shareholder/year to hold each IRA Document $8.00
VI. EARNINGS CREDITS
On a monthly basis any earnings credits generated from uninvested custody
balances will be first applied against any cash management service fees
and then to custody transaction fees (as referenced in item #1 above).
Earnings credits are based on the average yield of the 91 day U.S.
Treasury Bill for the preceding thirteen weeks less the 10% reserve.
13
<PAGE> 14
AMENDMENT TO AGREEMENT
This Amendment is made effective this 25th day of January, 1994 to the
Custody Agreement made as of December 29, 1993 by and between The American
Heritage Fund, Inc., (the "Fund") and Star Bank, N.A., (the "Custodian), to
provide custodial services to the Funds.
The Fund and the Custodian agree to amend the Agreement as follows:
1. Custodian agrees to retain custody of U.S. Government Securities and
securities issued and sold primarily in the United States. Custodian
hereby appoints and Fund agrees to the appointment of Bankers Trust
Company as Sub-Custodian to retain custody of foreign securities in
accordance with the terms and conditions of the Agreement dated as of
January 25, 1994 between Bankers Trust Company and Star Bank, N.A.
attached hereto as Appendix D (the "Sub-Custodian Agreement"). The
Fund hereby acknowledges such appointment and expressly agrees to
the terms and conditions set forth in the Sub-Custodian Agreement.
2. A new paragraph shall be added to Section 1 to read as follows:
Foreign Securities: The term foreign securities includes securities
issued and sold primarily outside of the United States by a foreign
government, a national of any foreign country or a corporation or
other organization incorporated or organized under the laws of any
foreign country and securities issued or guaranteed by the Government
of the United States or by any state or any political subdivision
thereof or by any agency thereof by any entity organized under the
laws of the United States or of any state thereof which have been
issued and sold primarily outside the United States.
IN WITNESS WHEREOF, the parties hereby ratify and affirm the Agreement in
its entirety as amended by this Amendment.
Attest: The American Heritage Fund, Inc.
[SIG] By: [SIG]
- ----------------------- ----------------------------
Attest: Star Bank N.A.
/s/ CHERI SCOTT GERACI By: /s/ LYNNETTE C. GIBSON
- ----------------------- ----------------------------
<PAGE> 15
APPENDIX D
CUSTODIAN AGREEMENT
AGREEMENT dated as of January 25, 1994 between BANKERS TRUST COMPANY (the
"Custodian") and Star Bank, N.A. (the "Customer"). Customer represents and
Custodian acknowledges that it is entering into this Agreement solely as
Custodian of The American Heritage Fund, Inc. (the "Fund"), its client, with
whom Customer has a Custody Agreement.
1. Employment of Custodian. The Customer hereby employs the Custodian
as custodian of all assets of the Customer which are delivered to and accepted
by the Custodian or any of its subcustodians (as that term is defined in
Section 5) anywhere in the world (the "Property") pursuant to the terms and
conditions set fort herein. Without limitation, such Property shall include
stocks and other equity interests of every type, evidences of indebtedness,
other instruments representing same or rights or obligations to received,
purchase, deliver or sell same and other non-cash investment property of the
Customer ("Securities") and cash from whatever source and in whatever
currency ("Cash"). The Custodian shall not be responsible for any property
of the Customer held or received by the Customer or others and not delivered
to the Custodian or any of its subcustodians.
2. Custody Account. The Custodian agrees to establish and maintain a
custody account in the name of the Customer (the "Account") for any and all
Property form time to time received and accepted by the Custodian or nay of its
subcustodians for the account of the Customer. The Customer acknowledges its
responsibility as a principal for all of its obligations to the Custodian
arising under or in connection with this Agreement, notwithstanding that it may
be acting on behalf of Fund and warrants its authority to deposit in the
Account any Property received therefor by the Custodian shall not be subject
to, nor shall its rights and obligations under this Agreement or with respect
to the Account be affected by, any agreement between the Customer and any other
person.
The Custodian shall hold, keep safe and protect as custodian in the
Account, on behalf of the Customer, all Property. All transactions, including,
but not limited to, foreign exchange transactions, involving the Property shall
be executed or settled solely in accordance with Instructions (as that term is
defied in Section 10), except that until the Custodian receives Instructions to
the contrary, the Custodian will:
(a) collect all interest and dividends and all other income and
payments whether paid in cash or in kind, on the Property, as
the same become payable and credit the same to the Account;
(b) present for payment all Securities held in the Account which are
called, redeemed or retired or otherwise become payable and all
coupons and other income items which call for payment upon
presentation and hold the cash received in the Account pursuant
to this Agreement;
(c) exchange Securities where the exchange is purely ministerial
(including, without limitation, the exchange of temporary
securities for those in definitive form and
<PAGE> 16
the exchange of warrants, or other documents of entitlement
to securities, for the Securities themselves);
(d) whenever notification of a rights entitlement or a
fractional interest resulting from a rights issue, stock
dividend or stock split is received for the Account and such
rights entitlement or fractional interest bears an
expiration date, if after endeavoring to obtain the
Customer's Instructions such Instructions are not received
in time for the Custodian to take timely action, sell in the
discretion of the Custodian (which sale the Customer hereby
authorizes the Custodian to make) such rights entitlement or
fractional interest and credit the Account with the net
proceeds of such sale;
(e) executed in the Customer's name for the Account, whenever
the Custodian deems it appropriate, such ownership and other
certificates as may be required to obtain the payment of
income from the Property; and
(f) pay for the Account, any and all taxes and levies in the
nature of taxes imposed on income on the Property by any
government authority. In the event there is insufficient
Cash available in the Account to pay such taxes and levies,
the Custodian shall notify the Customer of the amount of the
shortfall and the Customer, at its option, may deposit
additional Cash in the Account or take steps to have
sufficient Cash available. The Customer agrees, when and if
requested by the Custodian and required in connection with
the payment of any such taxes to cooperate with the
Custodian in furnishing information, executing documents or
otherwise.
The Custodian shall deliver, subject to Section 12 below, any and all
Property in the Account in accordance with instructions and in connection
therewith, the Customer will accept delivery of Securities of the same class and
denomination in place of those contained in the Account. Neither the Custodian
nor any subcustodian shall have any duty or responsibility to see to the
application of any Property withdrawn from the Account upon Instructions.
Except as otherwise may be agreed upon by the parties hereto, the
Custodian shall not be required to comply with any Instructions to settle the
purchase of any Securities for the Account unless there is sufficient Cash in
the Account at the time or settle the sale of any Securities from the Account
unless such Securities are in deliverable form. Notwithstanding the foregoing,
if the purchase price of such Securities exceeds the amount of Cash in the
Account at the time of such purchase, the Custodian may, in its sole discretion,
advance the amount of the difference in order to settle the purchase of such
Securities. The amount of any such advance shall be deemed a loan from the
Custodian to the Customer payable on demand and bearing interest accruing from
the date such loan is made to but not including the date such loan is repaid at
a rate per annum customarily charged by the Custodian on similar loans.
3. Records, Ownership of Property and Statements. The ownership of the
Property whether Securities, Cash and/or other property, and whether held by the
Custodian or a subcustodian or in a securities depository or clearing agency as
hereinafter authorized, shall be clearly recorded on the Custodian's books as
belonging to the Account and not for the Custodian's own interest. The Custodian
shall keep accurate and detailed accounts of all investments, receipts,
disbursements and other
<PAGE> 17
transactions for the Account. All accounts, books and records of the Custodian
relating thereto shall be open to inspection and audit at all reasonable times
during normal business hours by any person designated by the Customer. The
Custodian will supply to the Customer from time to time, as mutually agreed
upon, a statement in respect to any Property in the Account held by the
Custodian or by a subcustodian. In the absence of the filing in writing with the
Custodian by the Customer of exceptions or objections to any such statement
within sixty (60) days of the mailing thereof, the Customer shall be deemed to
have approved such statement; and in such case or upon written approval of the
Customer of any such statement, the Custodian shall, to the extent permitted by
law, be released, relieved and discharged with respect to all matters and things
set forth in such statement as though such statement had been settled by the
decree of a court of competent jurisdiction in an action in which the Customer
and all persons having any equity interest in the Customer were parties.
4. Maintenance of Property Outside of the United States. Property in
the Account may be held in a country or other jurisdiction outside of the United
States; provided that (a) with respect to Securities, such country or other
jurisdiction shall be one in which the principal trading market for such
Securities is located or the country or other jurisdiction in which such
Securities are to be presented for payment or are acquired for the Account and
(b) with respect to cash, the amount thereof to be maintained in any country or
other jurisdiction shall be an amount which is deemed necessary to settle
transactions relating to Securities purchased for the Account in such country or
jurisdiction or which is received in connection with the holding of such
Securities in the Account.
5. Subcustodians and Securities Depositories. The Custodian may
employ, directly or indirectly, one or more subcustodians to assist in the
performance of its obligations hereunder; provided, however, that the employment
of any such subcustodians (other than any such subcustodian which is a
securities depository or clearing agency) the Custodian shall only be
responsible or liable for loses arising from such employment caused by the
Custodian's own failure to exercise reasonable care.
The Customer authorizes and instructs the Custodian to hold the Property
in the Account in custody accounts which have been established by the Custodian
with one of its branches, a branch of another U.S. bank, a foreign bank or trust
company acting as custodian or a securities depository in which the Custodian
participants. Hereinafter, the term "subcustodian" will refer to any third-party
agent referred to in the first sentence of this paragraph which has entered into
an agreement with the Custodian of the type contemplated hereunder regarding
Securities and/or Cash held in or to be acquired for the Account. In addition,
the Customer also authorizes the Custodian to authorize any subcustodian to hold
the Property in the Account in one or more accounts with securities depositories
or clearing agencies in which such subcustodian participates subject to the
provisions set forth below. The Custodian shall select in its sole discretion
the entity or entities in the custody of which any of the Securities may be so
maintained or with which any Cash may be so deposited. Furthermore, any entity
so selected in authorized to hold such Securities or Cash in its account with
any securities depository or clearing agency in which it participates.
6. Use of Subcustodian. With respect to Securities in the Account
which are maintained by the Custodian in the custody of a subcustodian pursuant
to Section 5,
(a) The Custodian will identify on its books as belonging to the
Customer any Securities held by such subcustodian.
<PAGE> 18
(b) In the event that a subcustodian permits any of the
Securities placed in its care to be held in a securities
depository or clearing agency, such subcustodian will be
required by its agreement with the Custodian to identify on
its books such Securities as being held for the account of
the Custodian for its customers.
(c) Any Securities in the Account held by a subcustodian will be
subject only to the instructions of the Custodian or its
agents unless specifically otherwise authorized by the
Custodian on an exception basis; and any Securities held in
a securities depository or clearing agency for the account
of the Custodian or a subcustodian will be subject only to
the instructions of the Custodian or such subcustodian, as
the case may be.
(d) Securities deposited with a subcustodian will be maintained
in an account holding only assets for customers of the
Custodian.
(e) Any agreement the Custodian shall enter into with a
subcustodian with respect to the holding of Securities shall
require that (i) the Securities are not subject to any
right, charge, security interest lien or claim of any kind
in favor of such subcustodian except a claim for payment in
accordance with such agreement for their safe custody or
administration and expenses related thereto and (ii)
beneficial ownership of such Securities be freely
transferable without the payment of money or value other
than for safe custody or administration and expenses related
thereto.
(f) Upon request by the Customer, the Custodian will identify
the name, address and principal place of business of any
subcustodian and the name and address of the governmental
agency or other regulatory authority that supervises or
regulates such subcustodian.
7. Holding of Securities, Nominees, etc. Securities in the Account
which are held by the Custodian or any subcustodian may be held by such entity
in the name of the Customer, in its own name, in the name of its nominee or in
bearer form. Securities which are held with a subcustodian or are eligible for
deposit in a securities depository as provided above may be maintained with the
subcustodian or depository, as the case may be, in an account for the
Custodian's or subcustodian's customers. The Custodian or subcustodian, as the
case may be, may combine certificates of the same issue held by it as fiduciary
or as a custodian. In the event that any Securities in the name of the Custodian
or its nominee or held by one of its subcustodians and registered in the name of
such subcustodian or its nominee are called for partial redemption by the issuer
of such Security, the Custodian may, subject to the rules or regulations
pertaining to allocation of any securities depository in which such Securities
have been deposited, allot, or cause to be allotted, the called portion to the
respective beneficial holders of such class of security in any manner the
Custodian deems to be fair and equitable.
8. Proxies, etc. With respect to any proxies, notices, reports or
other communications relative to any of the Securities in the Account, the
Custodian shall perform such services relative thereto as may be agreed upon
between the Custodian and the Customer. Neither the Custodian nor its
<PAGE> 19
nominees or agents shall vote upon or in respect of any of the Securities in the
Account, execute any form of proxy to vote theron, or give any consent or take
any action (except as provided in Section 2) with respect thereto except upon
the receipt of Instructions from the Customer relative thereto.
9. Settlement Procedures. Settlement and payment for Securities
received for the Account and delivery of Securities maintained for the Account
may be effected in accordance with the customary or established securities
trading or securities processing practices and procedures in the jurisdiction or
market in which the transaction occurs, including, without limitation,
delivering Securities to the purchaser thereof or to a dealer therefor (or an
agent for such purchaser or dealer) against a receipt with the expectation of
receiving later payment for such Securities from such purchaser or dealer, and
in accordance with the standard operating procedures of the Custodian in effect
from time to time for that jurisdiction or market.
10. Instructions. The term "Instructions" means instructions from the
Customer in respect of any of the Custodian's duties hereunder which have been
received by the Custodian at its address set forth in Section 15 below in
writing or by tested telex signed or given by such one or more person or persons
as the Customer shall have from time to time authorized to give the particular
class of Instructions in question and whose name ad (if applicable) signature
and office address have been filed with the Custodian, or upon receipt of such
other form of instructions as the Customer may from time to time authorize in
writing and which the Custodian agrees to accept. The Custodian shall have the
right to assume in the absence of notice to the contrary from the Customer that
any person whose name is on file with the Custodian pursuant to this Section 10
has been authorized by the Customer to give the Instructions in question and
that such authorization has not been revoked.
11. Standard of Care. The Custodian shall be responsible for the
performance of only such duties as are set forth herein or contained in
Instructions given to he Custodian which are not contrary to the provisions of
this Agreement. The Custodian will use reasonable care with respect to the
safekeeping of Securities in the Account and in carrying out its obligations
under the Agreement. So long as and to the extent that it has exercised
reasonable care, the Custodian shall not be responsible for the title, validity
or genuineness of any Property or other property or evidence of title thereto
received by it or delivered by it pursuant to this Agreement and shall be held
harmless in acting upon, and may conclusively rely on, without liability for any
loss resulting therefrom, any notice, request, consent, certificate or other
instrument reasonably believed by it to be genuine and to be signed or furnished
by the proper party or parties, including, without limitation, Instructions, and
shall be indemnified by the Customer for any losses, damages, costs and expenses
(including, without limitation, the fees and expenses of counsel) incurred by
the Custodian and arising out of action taken or omitted in good faith by the
Custodian hereunder or under any Instructions. The Custodian shall be liable to
the Customer for any loss which shall occur directly as the result of the
failure of a subcustodian (other than any subcustodian which is a securities
depository or clearing agency the actions or omissions for which the Custodian's
liability and responsibility is set forth in the last proviso of the first
paragraph of Section 5) to exercise reasonable care with respect to the
safekeeping of such Securities. In the event of any loss to the Customer by
reason of the failure of the Custodian or its subcustodian to utilize reasonable
care, the Custodian shall be liable to the Customer to the extent of the
Customer's actual damages at the time such loss was discovered without reference
to any special conditions or circumstances. In no event shall the Custodian be
liable for any consequential or special damages. The Custodian shall be entitled
to rely, and may act, on advice of counsel (who may be counsel for the Customer)
on all matters and shall be without liability for any action reasonably taken or
omitted pursuant to such advice.
<PAGE> 20
All collections of funds or other property paid or distributed in respect
of Securities in the Account, including funds involved in third-party foreign
exchange transactions, shall be made at the risk of the Customer. The Custodian
shall have no liability for any loss accessioned by delay in the actual receipt
of notice by the Custodian or by its subcustodian of any payment, reception or
other transaction regarding Securities in the Accounting respect of which the
Custodian has agreed to take action as provided in Section 2 hereof. The
Custodian shall not be liable for any loss resulting from, or caused by, or
resulting from acts of governmental authorities (whether de jure or de facto),
including, without limitation, nationalization, expropriation, and the
imposition of currency restrictions; acts of war, terrorism, insurrection or
revolution; strikes or work stoppages; the inability of a local clearing and
settlement system to settle transactions for reasons beyond the control of the
Custodian; hurricane, cyclone, earthquake, volcanic eruption, nuclear fusion,
fission, radioactivity or other acts of God.
The provisions of this Section shall survive termination of this
Agreement.
12. Fees and Expenses. The Customer agrees to pay to the Custodian
such compensation for its services pursuant to this Agreement as may be mutually
agreed upon in writing from time to time and the Custodian's out-of-pocket or
incidental expenses, including (but not limitation) legal fees. The Customer
hereby agrees to hold the Custodian harmless from any liability or loss
resulting from any taxes or other governmental charges, and any expense related
thereto, which amy be imposed, or assessed with respect to any Property in the
Account and also agrees to hold the Custodian, its subcustodians, and their
respective nominees harmless from any liability as a record holder of Property
in the Account. The Custodian is authorized to charge any account of the
Customer for such items. The provisions of this Section shall survive the
termination of this Agreement.
13. Amendment, Modifications, etc. No provisions of this Agreement may
amended, modified or waived except in writing signed by the parties hereto.
14. Termination. This Agreement may be terminated by the Customer or
the Custodian by ninety (90) days' notice to the other; provided that notice by
the Customer shall specify the names of the persons to who the Custodian shall
deliver the Securities in the Account and to whom the Cash in the Account shall
be paid. If notice of termination is given by the Custodian, the Customer shall,
within ninety (90) days following the giving of such notice, deliver to the
Custodian a written notice specifying the names of the persons to whom the
Custodian shall deliver the Securities in the Account and to whom the Cash in
the Account shall be paid. In either case, the Custodian will deliver such
Securities and Cash to the persons so specified, after deducting therefrom any
amounts which the Custodian determines to be owed to it under Section 12. In
addition, the Custodian may in its discretion withhold from such delivery such
Cash and Securities as may be necessary to settle transactions pending at the
time of such delivery. If within ninety (90) days following the giving of a
notice of termination by the Custodian, the Custodian does not receive from the
Customer a written notice specifying the names of the persons to whom the Cash
in the Account shall be paid, the Custodian, at its election, may deliver such
Securities and pay such Cash to a bank or trust company doing business in the
State of New York to be held and disposed of pursuant to the provisions of this
Agreement, or may continue to hold such Securities and Cash until a written
notice as aforesaid is delivered to the Custodian.
15. Notices. Except as otherwise provided in this Agreement, all
requests, demands or other communications between the parties or notices in
connection herewith (a) shall be in writing, had
<PAGE> 21
delivered or sent by telex, telegram, facsimile or cable, addressed, if to the
Customer, to its address set forth on the signature page hereof and, if to the
Custodian, to c/o BTNY Services, Inc., 34 Exchange Place, Jersey City, New
Jersey 07302, Attention: Global Securities Services, (Telex No. 420066 Area 19
Answerback: BANTRUS) (Facsimile No. 201-860-7290), or in either case to such
other address as shall have been furnished to the receiving party pursuant to
the provisions hereof and (b) shall be deemed effective when received, or, in
the case of a telex, when sent to the proper number and acknowledged by a proper
answerback.
16. Security for Payment. To secure payment of all fees and expenses
payable to Custodian hereunder, including but not limited to amounts payable
pursuant to indemnification provisions and to the last paragraph of Section 2,
the Customer hereby grants to Custodian a continuing security interest in and
right to setoff against the Account and all Property held therein from time to
time in the full amount of such obligations; provided that, if the Account
consists of more than one fund and the obligations secured pursuant to this
Section 16 can be allocated to a specific fund, such security interest and right
of setoff will be limited to any amounts owned hereunder, Custodian shall be
entitled to use available Cash in the Account or such applicable portion thereof
held for a specific fund, as the case may be, and to dispose of Securities in
the Account or such applicable portion thereof as is necessary. In the event
Securities in the Account or such applicable portion thereof are insufficient to
discharge such obligations, the Customer hereby grants Custodian a continuing
security interest in and right of setoff against the balance from time to time
in any non-custodian account of the Customer (the "Pledged Balances"), and
Custodian may, at any time or from time to time at Custodian's sole option and
without notice, appropriate and apply toward the payment of such obligations,
the Pledged Balances. If at any time Property in the Account or such applicable
portion thereof and the Pledged Balances are insufficient to fully collateralize
such obligations, Customer shall provide to Custodian additional collateral in
form and amount satisfactory to Custodian and shall grant to Custodian a
continuing security interest in and right of setoff against such collateral. In
any such case and without limiting the foregoing, Custodian shall be entitled to
take such other action(s) or exercise such other options, powers and rights as
Custodian now or hereafter has a secured creditor under the New York Uniform
Commercial Code or any other applicable law.
17. Governing Law and Successors and Assigns. This Agreement shall be
governed by the law of the State of New York and shall not be assignable by
either party, but shall bind the successors in interest of the Customer and
Custodian.
18. Publicity. Customer shall furnish to Custodian at its office
referred to in Section 15 above, prior to any distribution thereof, copies of
any material prepared for distribution to any persons who are not parties hereto
that refer in any way Custodian. Customer shall not distribute or permit the
distribution of such materials if Custodian reasonable objects in writing within
ten (10) business days (or such other time as may be mutually agreed) after
receipt thereof. The provisions of this Section shall survive the termination of
this Agreement.
19. Submission to Jurisdiction. To the extent, if any, to which the
Customer or any of its respective properties may be deemed to have or hereafter
to acquire immunity, on the ground of sovereignty or otherwise, from any
judicial process or proceeding to enforce this Agreement or to collect amounts
due hereunder (including, without limitation, attachment proceedings prior to
judgment or in aid of execution) in any jurisdiction, the Customer hereby waives
such immunity and agrees not to claim the same. Any suit, action or proceeding
arising out of this Agreement may be instituted in any State or
<PAGE> 22
Federal court sitting in the City of New York, State of New York, United States
of America, and the Customer irrevocably submits to the non-exclusive
jurisdiction of any such court in any such suit, action or proceeding and
waives, to the fullest extent permitted by law, any objection which it may now
or hereafter have to the laying of venue of such suit, action or proceeding
brought in such a court and any claim that such suit, action or proceeding was
brought in an inconvenient forum. The Customer hereby irrevocably designates,
appoints and empowers, as its authorized agent to receive, for and on behalf of
the Customer and its property service of process in the State of New York when
and as such legal actions or proceedings may be brought in any of the
aforementioned courts, and such service of process shall be deemed complete upon
the date of delivery thereof to such agent whether or not such agent gives
notice thereof to the Customer or upon the earliest of any other date permitted
by applicable law. The Customer further irrevocably consents to the service of
process out of any of the aforementioned courts in any such action or proceeding
by the mailing of copies thereof by certified air mail, postage prepaid, to the
Customer at its address set forth below or in any other manner permitted by law,
such service to become effective upon the earlier of (i) the date fifteen (15)
days after such mailing or (ii) any earlier of date permitted by applicable law.
The Customer agrees that it will at all times continuously maintain an agent to
receive service of process in the City and State of New York on behalf of itself
and its properties with respect to this Agreement and in the event that, for any
reason, the agent named above or its successor shall no longer serve as agent of
the Customer to receive service of process in the City and State of New York on
its behalf, the Customer shall promptly appoint a successor to so serve and
shall advise the Custodian thereof.
20. Headings. The headings of the paragraphs hereof are included for
convenience of reference only and do not form a part of this Agreement.
STAR BANK, N.A.
By:
--------------------------------------
Title:
-----------------------------------
Address:
---------------------------------
BANKERS TRUST COMPANY
By:
--------------------------------------
Title:
-----------------------------------
<PAGE> 23
STAR BANK, N.A
GLOBAL CUSTODY
FEE SCHEDULE
1. Annual Charge on Fund Assets Non-Emerging Markets:
- 10 basis points on the first $25 million
- 12 basis points on the next $25 million
- Remainder to be negotiated
2. Transaction Fee For Non-Emerging Markets:
- $125 per Security Purchase/sale until funds asset
value reaches $25 million
- $75 per security purchase/sale once funds asset
value exceeds $25 million
Non-Emerging Markets:
<TABLE>
<S> <C> <C>
- - Cedel (Eurobonds) - Australia - Austria
- - Euroclear (Eurobonds) - Belgium - Hong Kong
- Canada - Indonesia
- Denmark - Malaysia
- France - Mexico (Equities)
- Germany - Philippines
- Italy - Singapore
- Ireland - Spain
- Japan - Sweden
- Luxembourg - Thailand
- Netherlands
- New Zealand
- Norway
- Switzerland
- United Kingdom
</TABLE>
<PAGE> 24
Assets and Transaction Fee - Emerging Markets:
<TABLE>
<CAPTION>
Country Annual Asset Fee Transactions
- ------- ---------------- ------------
<S> <C> <C>
Argentina 45 Basis Points $175
Bangladesh 35 Basis Points $175
Brazil 50 Basis Points $125
Chile 30 Basis Points $125
Columbia 40 Basis Points $150
Finland l5 Basis Points $125
Greece 5O Basis Points 20 Basis Points
India 45 Basis Points $175
Mexico (Bonds) 30 Basis Points $125
Pakistan 30 Basis Points $175
Peru 55 Basis Points $175
Portugal 15 Basis Points $125
Shanghai 25 Basis Points $100
Shenzen 25 Basis Points $100
South Korea 15 Basis Points $125
Sri Lanka 25 Basis Points $100
Turkey 30 Basis Points $125
Venezuela 35 Basis Points $125
</TABLE>
3. Base Fee - $525 per Account (per month)
4. Communications (Globe *Link) - Free of Charge
* The above fee schedule assumes the client will deal directly with Star Bank
and all foreign security transactions will be settled in U.S. dollars.
Notes
- -----
1. Fees are billed monthly.
2. Fees for the receipt of positions relating to the initial asset
transaction will be waived with the exception of Spain and Indonesia were
re-registration fees will be assessed.
3. Cash movements relating to third party FX trades will be assessed at $15
per U.S. wire movement and $50 per non U.S. wire movement. For FX trades
concluded with BTCo., this charge will be waived.
4. Fees for investment in countries not listed will be negotiated
separately.
5. Fees for stamp duty and registration, charged by local authorities, not
included as part of trade cost will be billed separately.
<PAGE> 1
Exhibit 23(h)(1)
TRANSFER AGENCY AND SERVICE AGREEMENT
AGREEMENT made the 10th day of April, 1997, by and between The American Heritage
Fund, Inc., a New York Corporation, having its principal office and place of
business at 1370 Avenue of the Americas, 31st Floor, New York, New York 10019
(the "Fund"), and American Data Services, Inc., a New York corporation having
its principal office and place of business at the Hauppauge Corporate Center,
150 Motor Parkway, Suite 109, Hauppauge, New York 11788 ("ADS")
WHEREAS, the Fund desires to appoint ADS as its transfer agent, dividend
disbursing agent and agent in connection with certain other activities, and ADS
desires to accept such appointment;
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. TERMS OF APPOINTMENT; DUTIES OF ADS
1.01 Subject to the terms and conditions set forth in this agreement, the
Fund hereby employs and appoints ADS to act as, and ADS agrees to act as its
transfer agent for the Fund's authorized and issued shares of its common stock,
("Shares"), dividend disbursing agent and agent in connection with any
accumulation, open-account or similar plans provided to the shareholders of the
fund ("Shareholders") set out in the currently effective prospectus and
statement of additional information ("prospectus") of the Fund.
1.02 ADS agrees that it will perform the following services:
(a) In accordance with procedures established from time to
time by agreement between the Fund and ADS, ADS shall:
Receive for acceptance, orders for the purchase of Shares, and promptly deliver
payment and appropriate documentation therefore to the Custodian of the Fund
authorized by the Board of Directors of the Fund (the "Custodian");
Pursuant to purchase orders, issue the appropriate number of Shares and hold
such Shares in the appropriate Shareholder account;
Receive for acceptance redemption requests and redemption directions and
deliver the appropriate documentation therefore to the Custodian;
At the appropriate time as and when it receives monies paid to it by the
Custodian with respect to any redemption, pay over or cause to be paid over in
the appropriate manner such monies as instructed by the redeeming Shareholders;
Effect transfers of Shares by the registered owners thereof upon receipt of
appropriate instructions;
Prepare and transmit payments for dividends and distributions declared by the
Fund;
<PAGE> 2
Maintain records of account for and advise the Fund and its Shareholders as
to the foregoing; and
Record the issuance of shares of the Fund and maintain pursuant to SEC Rule
17Ad-10(e) a record of the total number of shares of the Fund which are
authorized, based upon data provided to it by the Fund, and issued and
outstanding. ADS shall also provide the Fund on a regular basis with the total
number of shares which are authorized and issued and outstanding and shall have
no obligation, when recording the issuance of shares, to monitor the issuance of
such shares or to take cognizance of any laws relating to the issue or sale of
such shares, which functions shall be the sole responsibility of the Fund.
(b) In addition to and not in lieu of the services set forth in the above
paragraph (a), ADS shall:
Perform all of the customary services of a transfer agent, dividend disbursing
agent, including but not limited to: maintaining all Shareholder accounts,
preparing Shareholder meeting lists, mailing proxies, receiving and tabulating
proxies, mailing Shareholder reports and prospectuses to current Shareholders,
withholding taxes on U.S. resident and non-resident alien accounts, preparing
and filing U.S. Treasury Department Forms 1099 and other appropriate forms
required with respect to dividends and distributions by federal authorities for
all Shareholders, preparing and mailing confirmation forms and statements of
account to Shareholders for all purchases redemption's of Shares and other
confirmable transactions in Shareholder accounts, preparing and mailing activity
statements for Shareholders, and providing Shareholder account information and
(ii) provide a system and reports which will enable the Fund to monitor the
total number of Shares sold in each State.
In addition, the Fund shall (i) identify to ADS in writing those transactions
and shares to be treated as exempt from blue sky reporting for each State and
(ii) verify the establishment of such transactions for each state on the system
prior to activation and thereafter monitor the daily activity for each State as
provided by ADS. The responsibility of ADS for the Fund's blue sky State
registration status is solely limited to the initial establishment of
transactions subject to blue sky compliance by the Fund and the reporting of
such transactions to the Fund as provided above.
Procedures applicable to certain of these services may be established from
time to time by agreement between the Fund and ADS.
2. FEES AND EXPENSES
2.01 For performance by ADS pursuant to this Agreement, the Fund agrees to
pay ADS an annual maintenance fee for each Shareholder account and transaction
fees for each portfolio or class of shares serviced under this Agreement (See
Schedule A) as set out in the fee schedule attached hereto. Such fees and out-of
pocket expenses and advances identified under Section 2.02 below may be changed
from time to time subject to mutual written agreement between the Fund and ADS.
<PAGE> 3
2.02 In addition to the fee paid under Section 2.01 above, the Fund agrees
to reimburse ADS for out-of-pocket expenses or advances incurred by ADS for the
items set out in the fee schedule attached hereto. In addition, any other
expenses incurred by ADS at the request or with the consent of the Fund, will be
reimbursed by the Fund.
2.03 The Fund agrees to pay all fees and reimbursable expenses within five
days following the receipt of the respective billing notice. Postage for mailing
of dividends, proxies, Fund reports and other mailings to all shareholder
accounts shall be advanced to ADS by the Fund at least seven (7) days prior to
the mailing date of such materials.
3. REPRESENTATIONS AND WARRANTIES OF ADS
ADS represents and warrants to the Fund that:
3.01 It is empowered under applicable laws and by its charter and by-laws
to enter into and perform this Agreement.
3.02 All requisite corporate proceedings have been taken to authorize it
to enter into and perform this Agreement.
3.03 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.
3.04 ADS is duly registered as a transfer agent under the Securities Act
of 1934 and shall continue to be registered throughout the remainder of this
Agreement.
4. REPRESENTATIONS AND WARRANTIES OF THE FUND
The Fund represents and warrants to ADS that;
4.01 It is empowered under applicable laws and by its Articles of
Incorporation and By-Laws / Declaration of Trust to enter into and perform this
Agreement.
4.02 All proceedings required by said Articles of Incorporation and
By-Laws / Declaration of Trust have been taken to authorize it to enter into and
perform this Agreement.
4.03 It is an open-end management investment company registered under the
Investment Company Act of 1940.
4.04 A registration statement under the Securities Act of 1933 is
currently or will become effective and will remain effective, and appropriate
state securities law filings as required, have been or will be made and will
continue to be made, with respect to all Shares of the Fund being offered for
sale.
5. INDEMNIFICATION
5.01 ADS shall not be responsible for, and the Fund shall indemnify and
hold ADS harmless from and against, any and all losses, damages, costs, charges,
counsel fees, payments, expenses and liability arising out of or attributable
to:
<PAGE> 4
(a) All actions of ADS or its agents or subcontractors required to be taken
pursuant to this Agreement, provided that such actions are taken in good faith
and without gross negligence or willful misconduct.
(b) The Fund's refusal or failure to comply with the terms of this Agreement, or
which arise out of the Fund's lack good faith, gross negligence or willful
misconduct or which arise out of the breach of any representation or warranty of
the Fund hereunder.
(c) The reliance on or use by ADS or its agents or subcontractors of
information, records and documents which (i) are received by ADS or its agents
or subcontractors and furnished to it by or on behalf of the Fund, and (ii) have
been prepared and/or maintained by the Fund or any other person or firm on
behalf of the Fund.
(d) The reliance on, or the carrying out by ADS or its agents or subcontractors
of any instructions or requests of the Fund.
(e) The offer or sale of Shares in violation of any requirement under the
federal securities laws or regulations or the securities laws or regulations of
any state that such Shares be registered in such state or in violation of any
stop order or other determination or ruling by any federal agency or any state
with respect to the offer or sale of such Shares in such state.
5.02 ADS shall indemnify and hold the Fund harmless from and against any
and all losses, damages, costs, charges, counsel fees, payments, expenses and
liability arising out of or attributable to any action or failure or omission to
act by ADS as a result of ADS's lack of good faith, gross negligence or willful
misconduct.
5.03 At any time ADS may apply to any officer of the Fund for
instructions, and may consult with legal counsel with respect to any matter
arising in connection with the services to be performed by ADS under this
Agreement, and ADS and its agents or subcontractors shall not be liable and
shall be indemnified by the Fund for any action taken or omitted by it in
reliance upon such instructions or upon the opinion of such counsel. ADS, its
agents and subcontractors shall be protected and indemnified in acting upon any
paper or document furnished by or on behalf of the Fund, reasonably believed to
be genuine and to have been signed by the proper person or persons, or upon any
instruction, information, data, records or documents provided ADS or its agents
or subcontractors by machine readable input, telex, CRT data entry or other
similar means authorized by the Fund, and shall not be held to have notice of
any change of authority of any person, until receipt of written notice thereof
from the Fund. ADS, its agents and subcontractors shall also be protected and
indemnified in recognizing stock certificates which are reasonably believed to
bear the proper manual or facsimile signatures of the officers of the Fund, and
the proper countersignature of any former transfer agent or registrar, or of a
co-transfer agent or co-registrar.
5.04 In the event either party is unable to perform its obligations under
the terms of this Agreement because of acts of God, strikes, equipment or
transmission failure or damage reasonably beyond its control, or other causes
reasonably beyond its control, such party
<PAGE> 5
shall not be liable for damages to the other for any damages resulting from such
failure to perform or otherwise from such causes.
5.05 Neither party to this Agreement shall be liable to the other party
for consequential damages under any provision of this Agreement or for any act
or failure to act hereunder.
5.06 In order that the indemnification provisions contained in this
Article 5 shall apply, upon the assertion of a claim for which either party may
be required to indemnify the other, the party of seeking indemnification shall
promptly notify the other party of such assertion, and shall keep the other
party advised with respect to all developments concerning such claim. The party
who may be required to indemnify shall have the option to participate with the
party seeking indemnification the defense of such claim. The party seeking
indemnification shall in no case confess any claim or make any compromise in any
case in which the other party may be required to indemnify it except with the
other party's prior written consent.
6. COVENANTS OF THE FUND AND ADS
6.01 The Fund shall promptly furnish to ADS a certified copy of the
resolution of the Board of Directors of the Fund authorizing the appointment of
ADS and the execution and delivery of this Agreement.
6.02 ADS hereby agrees to establish and maintain facilities and procedures
reasonably acceptable to the Fund for safekeeping of stock certificates, check
forms and facsimile signature imprinting devices, if any; and for the
preparation or use, and for keeping account of, such certificates, forms and
devices.
6.03 ADS shall keep records relating to the services to be performed
hereunder, in the form and manner as it may deem advisable. To the extent
required by Section 31 of the Investment Company Act of 1940, as amended, and
the Rules thereunder, ADS agrees that all such records prepared or maintained by
ADS relating to the services to be performed by ADS hereunder are the property
of the Fund and will be preserved, maintained and made available in accordance
with such Section and Rules, and will be surrendered promptly to the Fund on and
in accordance with its request.
6.04 ADS and the Fund agree that all books, records, information and data
pertaining to the business of the other party which are exchanged or received
pursuant to the negotiation or the carrying out of this Agreement shall remain
confidential, and shall not be voluntarily disclosed to any other person, except
as may be required by law.
6.05 In case of any requests or demands for the inspection of the
Shareholder records of the Fund, ADS will endeavor to notify the Fund and to
secure instructions from an authorized officer of the Fund as to such
inspection. ADS reserves the right, however, to exhibit the Shareholder records
to any person whenever it is advised by its counsel that it may be held liable
for the failure to exhibit the Shareholder records to such person, and shall
promptly notify the Fund of any unusual request to inspect or copy the
shareholder records of the Fund
<PAGE> 6
or the receipt of any other unusual request to inspect, copy or produce the
records of the Fund.
7. EFFECTIVENESS, DURATION, AND TERMINATION
7.01 This Agreement shall become effective on the date first above written.
7.02 This Agreement shall remain in effect for a period of three (3) years from
the date of its effectiveness (the "Initial Term") and shall continue in effect
for successive twelve-month periods; provided that such continuance is
specifically approved at least annually by the Board and by a majority of the
Trustees who are not parties to this Agreement or interested persons of any such
party.
7.03 After the Initial Term, this Agreement may be terminated at anytime (i) by
the Board on 90 days' written notice to ADS or (ii) by ADS on 90 days' written
notice to the Fund. The obligations of Sections 2 and 5 shall survive any
termination of this Agreement
7.04 Should the Fund exercise its right to terminate, all out-of-pocket expenses
associated with the movement of records and material will be borne by the Fund.
Additionally, ADS reserves the right to charge for any other reasonable costs
expenses associated with such termination.
8. ASSIGNMENT
8.01 Neither this Agreement nor any rights or obligations hereunder may be
assigned by either party without the written consent of the other party.
8.02 This Agreement shall inure to the benefit of and be binding upon the
parties and their respective permitted successors and assigns.
9. AMENDMENT
9.01 This Agreement may be amended or modified by a written agreement
executed by both parties and authorized or approved by a resolution of the Board
of Directors / Trustees of the Fund.
10. NEW YORK LAWS TO APPLY
10.01 The provisions of this Agreement shall be construed and interpreted
in accordance with the laws of the State of New York as at the time in effect
and the applicable provisions of the 1940 Act. To the extent that the applicable
law of the State of New York, or any of the provisions herein, conflict with the
applicable provisions of the 1940 Act, the latter shall control.
11. MERGER OF AGREEMENT
11.01 This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject matter
hereof whether oral or written.
12. NOTICES.
All notices and other communications hereunder shall be in writing, shall
be deemed to have been given when received or when sent
<PAGE> 7
by telex or facsimile, and shall be given to the following addresses (or such
other addresses as to which notice is given):
To the Fund: To ADS:
Heiko H. Thieme Michael Miola,
President President
The American Heritage Fund, Inc. American Data Services, Inc.
1370 Avenue of the Americas, 31st Floor 150 Motor Parkway,
Suite 109
New York, NY 10019 Hauppauge, NY 11788
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
THE AMERICAN HERITAGE FUND, INC. AMERICAN DATA SERVICES, INC.
By: /s/ Heiko H. Thieme, President
By: /s/Michael Miola
<PAGE> 8
FEE SCHEDULE
For the services rendered by ADS in its capacity as transfer agent, the
Fund shall pay ADS, within ten (10) days after receipt of an invoice from ADS at
the beginning of each month, a fee, calculated as a combination of account
maintenance charges plus transaction charges as follows:
(a) ACCOUNT MAINTENANCE CHARGE:
The Greater of (No prorating for partial months):
Minimum maintenance charge per portfolio/class $1,000.00/ month
OR,
Based upon the total of all open/closed accounts (1) per portfolio/class upon
the following annual rates (billed monthly):
<TABLE>
<S> <C>
Fund Type:
Dividend calculated and
paid annually, semi-annually, quarterly................................ $ 8.80 per
account
(1) All accounts closed during a month
will be considered as open accounts for
billing purposes in the month the
account is closed.
PLUS,
(b) TRANSACTION FEES:
Trade Entry (purchase/liquidation) and maintenance transactions.......... $ 1.48 each
New account set-up
......................................................................... $ 2.74 each
Customer service calls
......................................................................... $ 1.11 each
Correspondence/ information requests
......................................................................... $ 1.37 each
Check preparation
......................................................................... $ .55 each
Liquidation's paid by wire transfer...................................... $ 3.29 each
ACH charge............................................................... $ .33 each
</TABLE>
<PAGE> 9
<TABLE>
<S> <C>
SWP...................................................................... $ 1.37 each
</TABLE>
(c) 24 HOUR AUTOMATED VOICE RESPONSE:
Initial set-up (one-time) charge per portfolio - $750.00
Monthly maintenance charge per portfolio - $50.00
All calls processed through automated voice response will be billed as a
customer service call listed above.
(d) Fund/SERV
All portfolios processed through Fund/SERV will be subject to an additional
monthly charge of $250.00
All transactions processed through Fund/SERV will be billed at the transaction
fee rates listed in (b) above.
(e) INTERNET ACCESS:
Each shareholder/adviser/broker hit billed at $0.25 per hit.
FEE INCREASES
On each annual anniversary date of this Agreement, the fees enumerated above
will be increased by the change in the Consumer Price Index for the Northeast
region (CPI) for the twelve-month period ending with the month preceding such
annual anniversary date.
(f) IRA PLAN FEES:
The following fees will be charged directly to the shareholder account:
<TABLE>
<S> <C>
Annual maintenance fee .............................................. $15.00 /account *
Incoming transfer from prior custodian .............................. $12.00
Distribution to a participant ....................................... $15.00
Refund of excess contribution ....................................... $15.00
Transfer to successor custodian ..................................... $15.00
Automatic periodic distributions .................................. $15.00/year per account
</TABLE>
* Includes $8.00 Bank Custody Fee.
<PAGE> 10
(g) EXPENSES:
The Fund shall reimburse ADS for any out-of-pocket expenses, exclusive of
salaries, advanced by ADS in connection with but not limited to the costs for
printing fund documents, (i.e. printing of confirmation forms, shareholder
statements, redemption/dividend checks, envelopes, financial statements, proxy
statement, fund prospectus, etc.) proxy solicitation and mailing expenses,
travel requested by the Fund, telephone toll charges, 800-line costs and fees,
facsimile and data transmission costs, stationery and supplies (related to Fund
records), record storage, postage (plus a $0.085 service charge for all
mailings), pro-rata portion of annual SAS-70 audit letter, telex and courier
charges incurred in connection with the performance of its duties hereunder. ADS
shall provide the Fund with a monthly invoice of such expenses and the Fund
shall reimburse ADS within fifteen (15) days after receipt thereof.
(h) SPECIAL REPORTS:
All reports and/or analyses requested by the Fund that are not included in
the fee schedule, shall be subject to an additional charge, agreed upon in
advance, based upon the following rates:
Labor:
Senior staff - $150.00/hr.
Junior staff - $ 75.00/hr.
Computer time - $45.00/hr.
<PAGE> 1
Exhibit 23(h)(2)
FUND ACCOUNTING SERVICE AGREEMENT
AGREEMENT made the 10th day of April, 1997, by and between The American Heritage
Fund, Inc., a New York Corporation, having its principal office and place of
business at 1370 Avenue of the Americas, 31st Floor, New York, New York 10019
(the "Fund"), and American Data Services, Inc., a New York corporation having
its principal office and place of business at the Hauppauge Corporate Center,
150 Motor Parkway, Suite 109, Hauppauge, New York 11788 ("ADS")
BACKGROUND
WHEREAS, the Fund is a diversified, open-end management investment company
registered with the United States Securities and Exchange Commission under the
Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, ADS is a corporation experienced in providing accounting services to
mutual funds and possesses facilities sufficient to provide such services; and
WHEREAS, the Fund desires to avail itself of the experience, assistance and
facilities of ADS and to have ADS perform for the Fund certain services
appropriate to the operations of the Fund, and ADS is willing to furnish such
services in accordance with the terms hereinafter set forth.
TERMS
NOW, THEREFORE, in consideration of the promises and mutual covenants
hereinafter contained, the Fund and ADS hereby agree as follows:
1. DUTIES OF ADS.
ADS will provide the Fund with the necessary office space, communication
facilities and personnel to perform the following services for the Fund:
(a) Timely calculate and transmit to NASDAQ the Fund's daily
net asset value and communicate such value to the Fund and its transfer agent;
Maintain and keep current all books and records of the Fund as required by Rule
31a-1 under the 1940 Act, as such rule or any successor rule may be amended from
time to time ("Rule 31a-1"), that are applicable to the fulfillment of ADS's
duties hereunder, as well as any other documents necessary or advisable for
compliance with applicable regulations as may be mutually agreed to between the
Fund and ADS. Without limiting the generality of the foregoing, ADS will prepare
and maintain the following records upon receipt of information in proper form
from the Fund or its authorized agents:
Cash receipts journal
Cash disbursements journal
Dividend record
Purchase and sales - portfolio securities journals
<PAGE> 2
Subscription and redemption journals
Security ledgers
Broker ledger
General ledger
Daily expense accruals
Daily income accruals
Securities and monies borrowed or loaned and collateral therefore
Foreign currency journals
Trial balances
(c) Provide the Fund and its investment adviser with daily
portfolio valuation, net asset value calculation and other standard operational
reports as requested from time to time.
(d) Provide all raw data available from our fund accounting
system (PAIRS) for management's or the administrators preparation of the
following:
1. Semi-annual financial statements;
2. Semi-annual form N-SAR;
3. Annual tax returns;
4. Financial data necessary to update form N-1a;
5. Annual proxy statement.
(e) Provide facilities to accommodate annual audit and any
audits or examinations conducted by the Securities and Exchange Commission or
any other governmental or quasi-governmental entities with jurisdiction.
ADS shall for all purposes herein be deemed to be an independent contractor and
shall, unless otherwise expressly provided or authorized, have no authority to
act for or represent the Fund in any way or otherwise be deemed an agent of the
Fund.
2. COMPENSATION OF ADS.
In consideration of the services to be performed by ADS as set forth
herein for each portfolio listed in Schedule B, ADS shall be entitled to receive
compensation and reimbursement for all reasonable out-of-pocket expenses. The
Fund agrees to pay ADS the fees and reimbursement of out-of-pocket expenses as
set forth in the fee schedule attached hereto as Schedule A.
3. LIMITATION OF LIABILITY OF ADS.
(a) ADS shall be held to the exercise of reasonable care in carrying out
the provisions of the Agreement, but shall be without liability to the Fund for
any action taken or omitted by it in good faith without gross negligence, bad
faith, willful misconduct or reckless disregard of its duties hereunder. It
shall be entitled to rely upon and may act upon the accounting records and
reports generated by the Fund, advice of the Fund, or of counsel for the Fund
and upon statements of the Fund's independent accountants, and shall be without
liability for any action reasonably taken or omitted pursuant to such records
and reports or advice, provided that such action is not, to the knowledge of
ADS, in violation of applicable federal or state laws or regulations, and
provided further that such action is taken without
<PAGE> 3
gross negligence, bad faith, willful misconduct or reckless disregard of its
duties.
(b) Nothing herein contained shall be construed to protect ADS against any
liability to the Fund or its security holders to which ADS shall otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence in the
performance of its duties on behalf of the Fund, reckless disregard of ADS'
obligations and duties under this Agreement or the willful violation of any
applicable law.
(c) Except as may otherwise be provided by applicable law, neither ADS nor
its stockholders, officers, directors, employees or agents shall be subject to,
and the Fund shall indemnify and hold such persons harmless from and against,
any liability for and any damages, expenses or losses incurred by reason of the
inaccuracy of information furnished to ADS by the Fund or its authorized agents.
4. REPORTS.
(a) The Fund shall provide to ADS on a quarterly basis a report of a duly
authorized officer of the Fund representing that all information furnished to
ADS during the preceding quarter was true, complete and correct in all material
respects. ADS shall not be responsible for the accuracy of any information
furnished to it by the Fund or its authorized agents, and the Fund shall hold
ADS harmless in regard to any liability incurred by reason of the inaccuracy of
such information.
(b) Whenever, in the course of performing its duties under this Agreement,
ADS determines, on the basis of information supplied to ADS by the Fund or its
authorized agents, that a violation of applicable law has occurred or that, to
its knowledge, a possible violation of applicable law may have occurred or, with
the passage of time, would occur, ADS shall promptly notify the Fund and its
counsel of such violation.
5. ACTIVITIES OF ADS.
The services of ADS under this Agreement are not to be deemed exclusive,
and ADS shall be free to render similar services to others so long as its
services hereunder are not impaired thereby.
6. ACCOUNTS AND RECORDS.
The accounts and records maintained by ADS shall be the property of the
Fund, and shall be surrendered to the Fund, at the expense of the Fund, promptly
upon request by the Fund, provided that all service fees and expenses charged by
ADS in the performance of its duties hereunder have been fully paid to the
satisfaction of ADS, in the form in which such accounts and records have been
maintained or preserved. ADS agrees to maintain a back-up set of accounts and
records of the Fund (which back-up set shall be updated on at least a weekly
basis) at a location other than that where the original accounts and records are
stored. ADS shall assist the Fund's independent auditors, or, upon approval of
the Fund, any regulatory body, in any requested review of the Fund's accounts
and records. ADS shall preserve the accounts and records as they are required to
be maintained and preserved by Rule 31a-1.
7. CONFIDENTIALITY.
<PAGE> 4
ADS agrees that it will, on behalf of itself and its officers and
employees, treat all transactions contemplated by this Agreement, and all other
information germane thereto, as confidential and not to be disclosed to any
person except as may be authorized by the Fund.
8. DURATION AND TERMINATION OF THIS AGREEMENT.
This Agreement shall become effective on the date first above written.
This Agreement shall remain in effect for a period of three (3) years from the
date of its effectiveness (the "Initial Term") and shall continue in effect for
successive twelve-month periods; provided that such continuance is specifically
approved at least annually by the Board and by a majority of the Directors who
are not parties to this Agreement or interested persons of any such party.
After the Initial Term, this Agreement may be terminated at anytime (i) by the
Board on 90 days' written notice to ADS or (ii) by ADS on 90 days' written
notice to the Fund. The obligations of Sections 2 and 3 shall survive any
termination of this Agreement
Should the Fund exercise its right to terminate, all out-of-pocket expenses
associated with the movement of records and material will be borne by the Fund.
Additionally, ADS reserves the right to charge for any other reasonable costs
expenses associated with such termination.
9. ASSIGNMENT.
This Agreement shall extend to and shall be binding upon the parties
hereto and their respective successors and assigns; provided, however, that this
Agreement shall not be assignable by the Fund without the prior written consent
of ADS, or by ADS without the prior written consent of the Fund.
10. NEW YORK LAWS TO APPLY
The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of New York as at the time in effect and
the applicable provisions of the 1940 Act. To the extent that the applicable law
of the State of New York, or any of the provisions herein, conflict with the
applicable provisions of the 1940 Act, the latter shall control.
11. AMENDMENTS TO THIS AGREEMENT.
This Agreement may be amended by the parties hereto only if such amendment
is in writing and signed by both parties.
12. MERGER OF AGREEMENT
This Agreement constitutes the entire agreement between the parties hereto
and supersedes any prior agreement with respect to the subject matter hereof
whether oral or written.
13. NOTICES.
All notices and other communications hereunder shall be in writing, shall
be deemed to have been given when received or when sent by telex or facsimile,
and shall be given to the following addresses (or such other addresses as to
which notice is given):
<PAGE> 5
To the Fund: To ADS:
Heiko H. Thieme Michael Miola
President President
The American Heritage Fund, Inc. American Data Services, Inc.
1370 Avenue of the Americas, 31st Floor 150 Motor Parkway, Suite 109
New York, NY 10019 Hauppauge, NY 11788
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
THE AMERICAN HERITAGE FUND, INC. AMERICAN DATA SERVICES, INC.
By: /s/ Heiko H. Thieme, President
By: /s/Michael Miola
SCHEDULE A
(a) FUND ACCOUNTING SERVICE FEE:
For the services rendered by ADS in its capacity as fund accounting agent,
as specified in Paragraph 1. DUTIES OF ADS, the Fund shall pay ADS, within ten
(10) days after receipt of an invoice from ADS at the beginning of each month, a
fee equal to:
Calculated Fee Will Be Based Upon Prior Month Average Net Assets:
(No prorating partial months)
MONTHLY FEE PER PORTFOLIO:
The greater of:
Minimum Monthly Fee - $3,025.94
OR,
Net Asset Charge of:
1/12th of 0.1153% of first $25 million of average monthly net assets, plus
1/12th of 0.0650% of next $25 million of average monthly net assets, plus 1/12th
of 0.025% on all average monthly net assets in excess of $50 million.
MULTI-CLASS PROCESSING CHARGE
$300 per month will be charged for each additional class of stock per
portfolio.
FEE INCREASES
<PAGE> 6
On each annual anniversary date of this Agreement, the fees enumerated
above will be increased by the change in the Consumer Price Index for the
Northeast region (CPI) for the twelve month period ending with the month
preceding such annual anniversary date.
(b) EXPENSES.
The Fund shall reimburse ADS for any out-of-pocket expenses , exclusive of
salaries, advanced by ADS in connection with but not limited to the printing or
filing of documents for the Fund, travel, telephone, quotation services
(currently (1) $0.12 per equity valuation, $0.60 per bond valuation, and 1.50
for each foreign quotation or manual quote insertion), facsimile transmissions,
stationery and supplies, record storage, NASDAQ insertion fee ($22 (1) per
month), prorata portion of annual SAS 70 review, postage, telex, and courier
charges, incurred in connection with the performance of its duties hereunder.
ADS shall provide the Fund with a monthly invoice of such expenses and the Fund
shall reimburse ADS within fifteen (15) days after receipt thereof.
(1) Rate subject to change on 30 days notice.
(c) SPECIAL REPORTS.
All reports and /or analyses requested by the Fund, its auditors, legal
counsel, portfolio manager, or any regulatory agency having jurisdiction over
the Fund, that are not in the normal course of fund accounting activities as
specified in Section 1 of this Agreement shall be subject to an additional
charge, agreed upon in advance, based upon the following rates:
Labor:
Senior staff - $150.00/hr.
Junior staff - $ 75.00/hr.
Computer time - $45.00/hr.
<PAGE> 7
SCHEDULE B:
PORTFOLIOS TO BE SERVICED UNDER THIS AGREEMENT:
THE AMERICAN HERITAGE FUND, INC.
<PAGE> 8
ADDENDUM TO
SCHEDULE A
Of the
Fund Accounting Service Agreement
Between The American Heritage Fund, Inc. and American Data Services, Inc.
Effective date: March 1, 1999
Effective as of the date first written above through February 29, 2000, the fund
accounting service fees enumerated in Schedule A of the Fund Accounting Service
Agreement dated April 10, 1997 between The American Heritage Fund, Inc. and
American Data Services, Inc. shall be subject to a discount of 20%. This
discount may be discontinued at any time by American Data Services.
Agreed and accepted by:
THE AMERICAN HERITAGE FUND, INC. AMERICAN DATA SERVICES, INC.
By: /s/ Heiko H. Thieme, President
By: /s/Michael Miola
<PAGE> 1
Exhibit (j)
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the inclusion by reference to Post-Effective Amendment No. 72 on
Form N-1A of The American Heritage Fund, Inc. of our report dated July 30, 1999
on our examination of the Financial Statements of such Company. We also consent
to the reference to our firm in such Registration Statement.
/s/ MATHIESON AITKEN JEMISON, LLP
Thursday, April 13, 2000
<PAGE> 1
Exhibit (P)(1)
THE AMERICAN HERITAGE FUND, INC.
CODE OF ETHICS
I. DEFINITIONS
A. " Access Person" means any director, officer general partner or
advisory person of the Fund.
B. "Act" means the Investment Company Act of 1940.
C. "Advisory Person" means: (i) any employee of the Fund or of any
company in a control relationship to the Fund, who, in connection
with his or her regular functions or duties, makes, participates
in, or obtains information regarding the purchase or sale of
Covered Securities by the Fund, or whose functions relate to the
making of any recommendations with respect to such purchases or
sales; and (ii) any natural person in a control relationship to
the Fund who obtains Information concerning recommendations made
to the Fund with regard to the purchase or sale of Covered
Securities by the Fund.
D. A Covered Security is "being considered for purchase or sale" when
a recommendation to purchase or sell the Covered Security has been
made and communicated and, with respect to the person making the
recommendation, when such person seriously considers making such a
recommendation.
E. "Beneficial ownership" shall be interpreted in the same manner as
it would be under Rule 16a-1(a)(2) under the Securities Exchange
Act of 1934 in determining whether a person is the beneficial
owner of a security for purposes of Section 16 of such Act and the
rules and regulations promulgated thereunder.
F. "Control" has the same meaning as that set forth in Section
2(a)(9) of the Act.
G. "Covered Security" means a security as defined in Section 2(a)(36)
of the Act, except that it does not include:
(i) Direct obligations of the Government of the United States;
(ii) Bankers' acceptances, bank certificates of deposit,
commercial paper and high quality short-term debt
instruments, including repurchase agreements; and
(iii) Shares issued by open-end registered investment companies.
H. "Disinterested Director" means a director of the Fund who is not
an "interested person" of the Fund within the meaning of Section
2(a)(19) of the Act.
I. "Fund"means The American Heritage Fund, Inc.
<PAGE> 2
J. "Initial Public Offering" means an offering of securities
registered under the Securities Act of 1933, the issuer of which,
immediately before the registration, was not subject to the
reporting requirements of Section 13 or Section 15(d) of the
Securities Exchange Act of 1934.
K. "Investment Personnel" means: (i) any employee of the Fund or of
any company in a control relationship to the Fund who, in
connection with his or her regular functions or duties, makes or
participates in making recommendations regarding the purchase or
sale of securities by the Fund; and (ii) any natural person who
controls the Fund and who obtains information concerning
recommendations made to the Fund regarding the purchase or sale of
securities by the Fund.
L. A "Limited Offering" means an offering that is exempt from
registration under the Securities Act of 1933 pursuant to Section
4(2) or Section 4(6) thereof or pursuant to Rule 504, Rule 505 or
Rule 506 thereunder.
M. "Purchase or sale of a Covered Security" includes, among other
things, the writing of an option to purchase or sell a Covered
Security.
II. APPROVAL AND MAINTENANCE OF CODE OF ETHICS
A. No less frequently than annually, the officers of the Fund shall
furnish a report to the Board of Directors of the Fund:
(i) Describing issues arising under the Code of Ethics since
the last report to the Board of Directors, including, but
not limited to, information about material violations of
the code and sanctions imposed in response to such material
violations. Such report shall also include a list of Access
Persons.
(ii) Certifying, if true, that the Fund has adopted such
procedures as are reasonably necessary to prevent Access
Persons from violating the Code of Ethics.
B. This Code of Ethics shall be maintained by a person designated by
the Fund to do so.
III. EXEMPTED TRANSACTIONS
The prohibitions of Section V of this Code of Ethics shall not apply to:
(a) Purchases or sales effected in any account over which the Access
Person has no direct or indirect influence or control.
(b) Purchases or sales of Covered Securities which are not eligible
for purchase or sale by the Fund.
(c) Purchases or sales which are non-volitional on the part of either
the Access Person or the Fund.
<PAGE> 3
(d) Purchases which are part of an automatic dividend reinvestment
plan.
(e) Purchases effected upon the exercise of rights issued by an issuer
pro rata to all holders of a class of its securities, to the
extent such rights were acquired from such issuer, and sales of
such rights so acquired.
(f) Purchases or sales which receive the prior approval of the Fund's
Board of Directors because they are only remotely potentially
harmful to the Fund because they would be very unlikely to affect
a highly institutional market, or because they clearly are not
related economically to the securities to be purchased, sold or
held by the Fund.
IV. PROHIBITED ACTIVITIES
A. Except in a transaction exempted by this Code of Ethics, no Access
Person shall purchase or sell, directly or indirectly, any Covered
Security in which he has, or by reason of such transaction would
acquire, any direct or indirect beneficial ownership and which to
his actual knowledge at the time of such purchase or sale is being
considered for purchase or sale by a Fund or is being purchased or
sold by a Fund.
B. Except in a transaction exempted by this Code of Ethics,
Investment Personnel of the Fund must obtain approval from the
Fund's Board of Directors before directly or indirectly acquiring
beneficial ownership in any securities in an Initial Public
Offering or in a Limited Offering.
V. REPORTING
A. Reports Required. Unless excepted by this Code of Ethics, every
Access Person of the Fund must report to the Fund:
(i) Initial Holdings Reports. No later than 10 days after the
person becomes an Access Person, the following information:
A. The title, number of shares and principal amount of
each Covered Security in which the Access Person had
any direct or indirect Beneficial Ownership when the
person became an Access Person;
B. the name of any broker, dealer or bank with whom the
Access Person maintained an account in which any
securities were held for the direct or indirect
benefit of the Access Person as of the date the
person became an Access Person; and
C. The date that the report is submitted by the Access
Person.
(ii) Quarterly Transaction Reports. No later than 10 days after
the end of a calendar quarter, the following information:
A. With respect to any transaction during the quarter
in a Covered Security in which the Access Person had
any direct or indirect Beneficial Ownership:
<PAGE> 4
1. The date of the transaction, the title, the interest
rate and maturity date (if applicable), the number
of shares and the principal amount of each Covered
Security involved;
2. The nature of the transaction (i.e., purchase, sale
or any other type of acquisition or disposition);
3. The price of the Covered Security at which the
transaction was effected;
4. The name of the broker, dealer or bank with or
through which the transaction was effected; and
5. The date that the report is submitted by the Access
Person.
B. With respect to any account established by the Access
Person in which any securities were held during the quarter
for the direct or indirect benefit of the Access Person:
1. The name of the broker, dealer or bank with whom the
Access Person established the account;
2. The date the account was established; and
3. The date that the report is submitted by the Access
Person.
(iii) Annual Holdings Reports. Annually, the following information
(which information must be current as of a date no more than 30
days before the report is submitted):
A. The title, number of shares and principal amount of each
Covered Security in which the Access Person had any direct
or indirect Beneficial Ownership;
B. The name of any broker, dealer or bank with whom the Access
Person maintains an account in which any securities are
held for the direct or indirect benefit of the Access
Person; and
C. The date that the report is submitted by the Access Person.
B. Exceptions from Reporting Requirements.
(i) A person need not make a report with respect to
transactions effected for, and Covered Securities held in,
any account over which the person has no direct or indirect
influence or control.
(ii) A director of the Fund who is not an interested person of
the Fund and who would otherwise be required to make a
report solely by reason of being a Fund director, need not
make:
<PAGE> 5
A. An Initial Holdings Report and an Annual Holdings
Report; and
B. A Quarterly Transaction Report, unless the director
knew or, in the ordinary course of fulfilling his or
her official duties as a fund director, should have
known that during the 15-day period immediately
before or after the director's transaction in a
Covered Security, the Fund purchased or sold the
Covered Security, or the Fund or its investment
adviser considered purchasing or selling the Covered
Security.
C. An Access Person need not make a Quarterly
Transaction Report if the report would duplicate
information contained in broker trade confirmations
or account statements received by the Fund or its
investment adviser with respect to the Access Person
no later than 10 days after the end of a calendar
quarter, if all of the information required by
Quarterly Transaction Report is contained in the
broker trade confirmations or account statements, or
in the records of the Fund or its investment
adviser.
C. Review of Reports. The Fund's shall designate a person to review
all reports filed pursuant to this Code of Ethics.
D. Notification of Reporting Obligation. The Fund shall identify all
Access Persons who are required to make the reports and shall
inform them of their reporting obligation.
E. Beneficial Ownership. Any report may contain a statement that the
report will not be construed as an admission that the person
making the report has any direct or indirect Beneficial Ownership
in the Covered Security to which the report relates.
VI. SANCTIONS
Upon discovering a violation of this Code of Ethics, the Board of
Directors of the Fund may impose such sanctions as it deems appropriate.
<PAGE> 1
AMERICAN HERITAGE MANAGEMENT CORP.
CODE OF ETHICS
I. DEFINITIONS
A. " Access Person" means any director, officer general partner or
advisory person of the Funds.
B. "Act" means the Investment Company Act of 1940.
C. "Advisor" means American Heritage Management Corp.
D. "Advisory Person" means: (i) any employee of the Advisor or of any
company in a control relationship to the Advisor, who, in
connection with his or her regular functions or duties, makes,
participates in, or obtains information regarding the purchase or
sale of Covered Securities by the Funds, or whose functions relate
to the making of any recommendations with respect to such
purchases or sales; and (ii) any natural person in a control
relationship to the Advisor who obtains Information concerning
recommendations made to the Funds with regard to the purchase or
sale of Covered Securities by the Funds.
E. A Covered Security is "being considered for purchase or sale" when
a recommendation to purchase or sell the Covered Security has been
made and communicated and, with respect to the person making the
recommendation, when such person seriously considers making such a
recommendation.
F. "Beneficial ownership" shall be interpreted in the same manner as
it would be under Rule 16a-1(a)(2) under the Securities Exchange
Act of 1934 in determining whether a person is the beneficial
owner of a security for purposes of Section 16 of such Act and the
rules and rules promulgated thereunder.
F. "Control" has the same meaning as that set forth in Section
2(a)(9) of the Act.
G. "Covered Security" means a security as defined in Section 2(a)(36)
of the Act, except that it does not include:
(i) Direct obligations of the Government of the United States;
(ii) Bankers' acceptances, bank certificates of deposit,
commercial paper and high quality short-term debt
instruments, including repurchase agreements; and
(iii) Shares issued by open-end registered investment companies.
H. "Funds" means The American Heritage Funds, Inc. and American
Heritage Growth Funds, Inc.
<PAGE> 2
I. "Initial Public Offering" means an offering of securities
registered under the Securities Act of 1933, the issuer of which,
immediately before the registration, was not subject to the
reporting requirements of Section 13 or Section 15(d) of the
Securities Exchange Act of 1934.
J. "Investment personnel" means: (i) any employee of the Advisor or
of any company in a control relationship to the Advisor who, in
connection with his or her regular functions or duties, makes or
participates in making recommendations regarding the purchase or
sale of securities by the Funds; and (ii) any natural person who
controls the Advisor and who obtains information concerning
recommendations made to the Funds regarding the purchase or sale
of securities by the Funds.
K. A "Limited Offering" means an offering that is exempt from
registration under the Securities Act of 1933 pursuant to Section
4(2) or Section 4(6) thereof or pursuant to Rule 504, Rule 505 or
Rule 506 thereunder.
L. "Purchase or sale of a Covered Security" includes, among other
things, the writing of an option to purchase or sell a Covered
Security.
II. APPROVAL AND MAINTENANCE OF CODE OF ETHICS
A. No less frequently than annually, the officers of Adviser shall
furnish a report to the Board of Directors of the Advisor:
(i) Describing issues arising under this Code of Ethics since
the last report to the Board of Directors, including, but
not limited to, information about material violations of
the Code of ethics and sanctions imposed in response to
such material violations. Such report shall also include a
list of Access Persons under the Code of Ethics.
(ii) Certifying, if true, that the Advisor has adopted such
procedures as are reasonably necessary to prevent Access
Persons from violating the Code of Ethics.
B. The officers of the Advisor shall furnish a written report to the
Board of Directors of the Funds describing any material changes
made to this Code of Ethics within ten days after making any such
material change.
C. This Code of Ethics and the certifications and reports required
hereby shall be maintained by a person designated by the Advisor
to do so.
III. EXEMPTED TRANSACTIONS
The prohibitions of Section IV of this Code of Ethics shall not apply to:
(a) Purchases or sales effected in any account over which the Access
Person has no direct or indirect influence or control. Purchases
or sales of Covered Securities which are not eligible for purchase
or sale by the Funds.
<PAGE> 3
(b) Purchases or sales which are non-volitional on the part of either
the Access Person or the Funds.
(c) Purchases which are part of an automatic dividend reinvestment
plan.
(d) Purchases effected upon the exercise of rights issued by an issuer
pro rata to all holders of a class of its securities, to the
extent such rights were acquired from such issuer, and sales of
such rights so acquired.
(e) Purchases or sales which receive the prior approval of the Funds's
Board of Directors because they are only remotely potentially
harmful to the Funds because they would be very unlikely to affect
a highly institutional market, or because they clearly are not
related economically to the securities to be purchased, sold or
held by the Funds.
IV. PROHIBITED ACTIVITIES
A. Except in a transaction exempted by this Code of Ethics, no Access
Person shall purchase or sell, directly or indirectly, any Covered
Security in which he has, or by reason of such transaction would
acquire, any direct or indirect beneficial ownership and which to
his actual knowledge at the time of such purchase or sale is being
considered for purchase or sale by a Funds or is being purchased
or sold by a Funds.
B. Except in a transaction exempted by this Code of Ethics,
Investment Personnel of the Funds must obtain approval from the
Funds's Board of Directors before directly or indirectly acquiring
beneficial ownership in any securities in an Initial Public
Offering or in a Limited Offering.
V. REPORTING
A. Reports Required. Unless excepted by this Code of Ethics, every
Access Person of the Advisor must report to the Advisor:
(i) Initial Holdings Reports. No later than 10 days after the
person becomes an Access Person, the following information:
A. The title, number of shares and principal amount of
each Covered Security in which the Access Person had
any direct or indirect Beneficial Ownership when the
person became an Access Person;
B. the name of any broker, dealer or bank with whom the
Access Person maintained an account in which any
securities were held for the direct or indirect
benefit of the Access Person as of the date the
person became an Access Person; and
C. The date that the report is submitted by the Access
Person.
(ii) Quarterly Transaction Reports. No later than 10 days after
the end of a calendar quarter, the following information:
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A. With respect to any transaction during the quarter
in a Covered Security in which the Access Person had
any direct or indirect Beneficial Ownership:
1. The date of the transaction, the title, the
interest rate and maturity date (if
applicable), the number of shares and the
principal amount of each Covered Security
involved;
2. The nature of the transaction (i.e.,
purchase, sale or any other type of
acquisition or disposition);
3. The price of the Covered Security at which
the transaction was effected;
4. The name of the broker, dealer or bank with
or through which the transaction was
effected; and
5. The date that the report is submitted by the
Access Person.
B. With respect to any account established by the
Access Person in which any securities were held
during the quarter for the direct or indirect
benefit of the Access Person:
1. The name of the broker, dealer or bank with
whom the Access Person established the
account;
2. The date the account was established; and
3. The date that the report is submitted by the
Access Person.
(iii) Annual Holdings Reports. Annually, the following
information (which information must be current as of a date
no more than 30 days before the report is submitted):
A. The title, number of shares and principal amount of
each Covered Security in which the Access Person had
any direct or indirect Beneficial Ownership;
B. The name of any broker, dealer or bank with whom the
Access Person maintains an account in which any
securities are held for the direct or indirect
benefit of the Access Person; and
C. The date that the report is submitted by the Access
Person.
B. Exception from Reporting Requirements.
A person need not make a report with respect to transactions
effected for, and Covered Securities held in, any account over
which the person has no direct or indirect influence or control.
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C. Review of Reports. The Advisor shall designate a person to review
all reports filed pursuant to this Code of Ethics.
D. Notification of Reporting Obligation. The Advisor shall identify
all Access Persons who are required to make the reports and shall
inform them of their reporting obligation.
E. Beneficial Ownership. Any report may contain a statement that the
report will not be construed as an admission that the person
making the report has any direct or indirect Beneficial Ownership
in the Covered Security to which the report relates.
VI. SANCTIONS
Upon discovering a violation of this Code of Ethics, the Board of
Directors of the Advisor may impose such sanctions as it deems
appropriate.
