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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /X/
POST-EFFECTIVE AMENDMENT NO. 73 /X/
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT /X/
OF 1940
AMENDMENT NO. 28 /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>
/X/ IMMEDIATELY UPON FILING PURSUANT TO / / ON (DATE) PURSUANT TO PARAGRAPH
PARAGRAPH (b) (b)
/ / 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
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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
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TABLE OF CONTENTS
<TABLE>
<S> <C>
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
</TABLE>
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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
September 19, 2000, the securities of each of two companies which are
speculative represented approximately 78% and 13% 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
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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
September 19, 2000, approximately 78% 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 September 19, 2000,
securities representing approximately 90% 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 December 31, 1999 to
August 31, 2000 was approximately 19%.
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 7.12%
Total annual Fund operating expenses 8.37%
* Includes administrative fees of approximately .6%.
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 1 3 5 10
of Years
<S> <C> <C> <C> <C>
$879 $2,538 $4,074 $7,432
</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 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 funds whose
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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>
2000 1999 1998 1997 1996
<S> <C> <C> <C> <C> <C>
Net assets value, beginning of year $ .28 $ .93 $ .83 $ .76 $ .63
Income (loss) from investment operations:
Net investment income (loss) (.04) (.04) (.04) (.03) (.02)
Net gains or (losses) on securities
(Both realized and unrealized) .03 (.61) .14 .10 .15
---------- ---------- ----------- ----------- -----------
Total from investment operations (.01) (.65) .10 .07 .13
Less distributions:
Dividends (from net investment income) - - - - -
Distributions (from capital gains) - - - - -
Return of capital distribution - - - - -
---------- ---------- ----------- ----------- -----------
Net assets value, end of year $ .27 $ .28 $ .93 $ .83 $ .76
========== ========== =========== =========== ===========
Total return (3.57%) (69.89%) 12.05% 9.21% 20.63%
Net assets, end of period $3,473,766 $4,348,413 $16,890,738 $18,126,591 $21,429,753
Ratio of expenses to
average net assets 8.37% 8.88% 5.85% 6.42% 6.25%
Ratio of net income (loss) to
average net assets (7.90%) (8.67%) (4.08%) (4.97%) (3.53%)
Portfolio turnover rate 13% 1,528% 1,180% 470% 606%
</TABLE>
MANAGEMENT'S DISCUSSION OF OUR PERFORMANCE
During our fiscal year ended May 31, 2000, the factor that materially affected
our performance were our continued concentration on small companies within the
medical field.
COMPARISON OF A $10,000 INVESTMENT IN THE
FUND TO THE SAME INVESTMENT IN THE S&P 500
INDEX
AVERAGE ANNUAL TOTAL RETURN
June 1, 1990 through May 31, 2000 -7.1%
June 1, 1995 through May 31, 2000 -15.6%
June 1, 1999 through May 31, 2000 -3.6%
<TABLE>
<CAPTION>
AMERICAN
HERITAGE FUND S&P 500 INDEX
DIVIDENDS DIVIDENDS
DATE REINVESTED AT NAV REINVESTED AT INDEX
--------------------------------------------------------------
<C> <C> <C>
May-90 $9,035 $11,713
Jun-90 $9,123 $11,634
Jul-90 $8,509 $11,596
Aug-90 $7,281 $10,549
Sep-90 $6,491 $10,037
Oct-90 $6,140 $9,994
Nov-90 $6,140 $10,639
Dec-90 $6,316 $10,935
Jan-91 $6,404 $11,410
Feb-91 $8,596 $12,225
Mar-91 $9,737 $12,521
Apr-91 $9,386 $12,551
May-91 $9,737 $13,091
Jun-91 $9,649 $12,491
Jul-91 $10,175 $13,073
Aug-91 $10,877 $13,382
Sep-91 $10,877 $13,158
Oct-91 $11,667 $13,334
Nov-91 $11,491 $12,798
Dec-91 $12,451 $14,260
Jan-92 $13,916 $13,994
Feb-92 $14,771 $14,175
Mar-92 $14,649 $13,900
Apr-92 $14,160 $14,308
May-92 $14,038 $14,378
Jun-92 $13,672 $14,164
Jul-92 $13,428 $14,742
Aug-92 $12,696 $14,441
Sep-92 $12,696 $14,611
Oct-92 $13,550 $14,661
Nov-92 $14,283 $15,159
Dec-92 $14,850 $15,344
Jan-93 $14,850 $15,473
Feb-93 $16,296 $15,683
Mar-93 $17,610 $16,014
Apr-93 $16,822 $15,627
May-93 $18,662 $16,044
Jun-93 $19,319 $16,091
Jul-93 $19,056 $16,026
Aug-93 $19,976 $16,633
Sep-93 $20,239 $16,505
Oct-93 $21,290 $16,846
Nov-93 $20,633 $16,687
Dec-93 $20,997 $16,888
Jan-94 $20,859 $17,462
Feb-94 $19,213 $16,988
Mar-94 $17,291 $16,249
Apr-94 $16,742 $16,457
May-94 $16,331 $16,727
Jun-94 $14,958 $16,317
Jul-94 $14,821 $16,852
Aug-94 $14,821 $17,542
Sep-94 $14,821 $17,114
Oct-94 $14,272 $17,497
Nov-94 $13,998 $16,861
Dec-94 $13,578 $17,110
Jan-95 $13,419 $17,554
Feb-95 $12,939 $18,237
Mar-95 $12,141 $18,775
Apr-95 $11,342 $19,327
May-95 $10,064 $20,098
Jun-95 $10,383 $20,565
Jul-95 $10,703 $21,246
Aug-95 $10,383 $21,299
Sep-95 $10,703 $22,198
Oct-95 $10,064 $22,118
Nov-95 $9,744 $23,088
Dec-95 $9,425 $23,533
Jan-96 $10,224 $24,333
Feb-96 $11,022 $24,559
Mar-96 $11,342 $24,796
Apr-96 $12,141 $25,161
May-96 $12,141 $25,809
Jun-96 $11,022 $25,907
Jul-96 $9,744 $24,763
Aug-96 $9,904 $25,286
Sep-96 $9,425 $26,708
Oct-96 $9,425 $27,445
Nov-96 $8,946 $29,517
Dec-96 $8,946 $28,933
Jan-97 $11,661 $30,739
Feb-97 $12,620 $30,981
Mar-97 $13,259 $29,710
Apr-97 $13,259 $31,482
May-97 $13,259 $33,398
Jun-97 $15,975 $34,893
Jul-97 $17,093 $37,669
Aug-97 $17,412 $35,560
Sep-97 $16,614 $37,506
Oct-97 $15,815 $36,255
Nov-97 $14,537 $37,932
Dec-97 $15,655 $38,583
Jan-98 $13,578 $39,009
Feb-98 $12,939 $41,821
Mar-98 $12,620 $43,961
Apr-98 $13,259 $44,403
May-98 $14,856 $43,641
Jun-98 $12,141 $45,413
Jul-98 $13,578 $44,930
Aug-98 $7,828 $38,441
Sep-98 $7,987 $40,904
Oct-98 $7,668 $44,228
Nov-98 $7,029 $46,907
Dec-98 $6,070 $49,609
Jan-99 $5,272 $51,682
Feb-99 $5,431 $50,076
Mar-99 $5,112 $52,079
Apr-99 $4,633 $54,096
May-99 $4,473 $52,820
Jun-99 $4,153 $55,749
Jul-99 $3,994 $54,010
Aug-99 $3,355 $53,743
Sep-99 $3,514 $52,272
Oct-99 $4,153 $55,578
Nov-99 $4,313 $56,708
Dec-99 $4,153 $60,046
Jan-00 $5,431 $57,029
Feb-00 $8,626 $55,889
Mar-00 $6,709 $61,353
Apr-00 $5,591 $59,508
May-00 $4,313 $58,286
</TABLE>
Past performance does not predict future performance.
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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, 2000, 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 (generally 4 P.M. Eastern
Time). 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:
<TABLE>
<CAPTION>
Opening the Account Adding to the Account
------------------- ---------------------
<S> <C> <C>
Regular Accounts $1,000 $500
IRAs, Custodian Accounts 500 500
and Keogh Accounts
</TABLE>
11
<PAGE> 14
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.
A proper request 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 long you have been in the Fund and whether you reinvest your
distributions or take them in cash.
13
<PAGE> 16
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
A prototype defined contribution retirement plan and individual retirement
account is available.
14
<PAGE> 17
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, Inc., 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? ------------------
--------------------------------------------------------------------------------
09/00
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
<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 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
restriction is not a fundamental policy 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.
B-7
<PAGE> 28
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 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* 57 Chairman of the Board Chairman of the Board of
1370 Avenue of the of Directors, Chief Directors, Chief Executive Officer
Americas Executive Officer and and Secretary of the Fund and
New York, NY Secretary American Heritage Growth Fund,
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 Fonds International
(foreign investment company) and
The Global Opportunity Fund
Limited (foreign investment
company) and their respective
investment advisors.
Stephen Swope 64 Director Mr. Swope has been retired for
75 Club Road more than five years.
Riverside, CT
Eugene Sarver 57 Director Sole proprietor of Sarver
241 W. 97th St. International (financial and
New York, NY economic consulting) and
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.
B-9
<PAGE> 30
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 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, 2000, no compensation was paid by
the Fund to its officers. Each of the Fund's Directors who is not an interested
person 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
B-10
<PAGE> 31
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 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, 1998, 1999 and 2000, the Fund
paid brokerage commissions of $990,836, $444,766 and $1,800, respectively, to
TSI. During the fiscal year ended May 31, 2000, the commissions paid by the Fund
to TSI represented approximately 10% of the total brokerage commissions paid by
the Fund that year. During the same year, approximately 16% 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 &
B-11
<PAGE> 32
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, 1998
and 1999 during the time Mr. Parker held his shares of AHMC, the Fund paid
brokerage commissions of $136,527 and $14,520, respectively to BSI.
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
On September 20, 2000 Charles Schwab & Co. Inc., 101 Montgomery Street,
San Francisco, CA 94104 owned of record shares of the Fund's capital stock which
represented approximately 7% 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.
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
B-12
<PAGE> 33
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. 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.
B-13
<PAGE> 34
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 short-term capital gain or ordinary income.
INVESTMENT ADVISORY AND OTHER SERVICES
Heiko H. Thieme controls AHMC by virtue of his record and beneficial
ownership of all of it's the outstanding capital stock. 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. Trading operations do not include the
payment of brokerage commissions. All expenses of the Fund, other than its
trading operations, 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, 1998, 1999 and 2000, the Fund
incurred investment advisory fees to AHMC of $250,628, $103,112 and $53,449
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
B-14
<PAGE> 35
May 31, 2000.
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.
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
B-15
<PAGE> 36
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.
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
<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.
C-1
<PAGE> 39
(p) (1) Code of Ethics of the Registrant*
(2) Code of Ethics of American Heritage Management Corp.*
----------------
* Filed as an exhibit to Post-Effective Amendment No. 72 and
incorporated herein by reference.
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.
C-2
<PAGE> 40
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.
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 and the Investment Company
Act, the Fund certifies that it meets all of the requirements for effectiveness
of this Registration Statement under Rule 485(b) under the Securities Act and
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, duly authorized, in the City of New York and the State of New York
on the 20th day of September, 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, this Registration Statement
has been signed below by the following persons in the capacities and on the
dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Heiko H. Thieme Chief Executive September 20, 2000
Heiko H. Thieme Officer, Principal
Financial and
Accounting Officer
and Director
/s/ Eugene Sarver Director September 20, 2000
Eugene Sarver
/s/ Stephen Swope Director September 20, 2000
Stephen Swope
</TABLE>
C-4
<PAGE> 42
EXHIBIT LIST DESCRIPTION
EXHIBITS NO.
------------
(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.*
----------------
* Filed as an exhibit to Post-Effective Amendment No. 72 and
incorporated herein by reference.
