CUSTODY AGREEMENT
AGREEMENT dated as of the 1st day of June, 1996, between AMERINDO FUNDS
INC., a corporation organized under the laws of the State of Maryland,
having its principal office and place of business at 000 Xxxx Xxxxxx, Xxx
Xxxx, XX x0000 (the "Company"), and THE NORTHERN TRUST COMPANY (the
"Custodian"), an Illinois Company with its principal place of business at
00 Xxxxx XxXxxxx Xxxxxx Xxxxxxx, Xxxxxxxx 00000.
W I T N E S S E T H:
That for and in consideration of the mutual promises hereinafter set forth,
the Company and the Custodian agree as follows:
1. DEFINITIONS.
Whenever used in this Agreement or in any Schedules to this Agreement, the
following words and phrases, unless the context otherwise requires, shall
have the following meanings:
(a) The "1940 Act" shall mean the Investment Company Act of 1940, and the
Rules and Regulations thereunder, all as amended from time to time.
(b) "Authorized Person" shall be deemed to include the Chairman of the
Board of Directors, the President, and any Vice President, the Secretary, the
Treasurer or any other person, whether or not any such person is an officer or
employee of the Company, duly authorized by the Board of Directors to give Oral
Instructions and Written Instructions on behalf of the Company and listed in the
certification annexed hereto as Schedule A or such other certification as may be
received by the Custodian from time to time.
(c) "Board of Directors" shall mean the Board of Directors of the Company.
(d) "Book-Entry System" shall mean the Federal Reserve/Treasury book-entry
system for United States and federal agency Securities, its successor or
successors and its nominee or nominees.
(e) "Certificate" shall mean any notice, instruction or other instrument in
writing, authorized or required by this Agreement to be given to the Custodian,
which is actually received by the Custodian and signed on behalf of the Company
by any two Authorized Persons or any two officers thereof.
(f) "Articles of Incorporation" shall mean the Articles of Incorporation of
the Company dated February 6, 1996, as amended.
(g) "Depository" shall mean The Depository Trust Company, a clearing agency
registered with the Securities and Exchange Commission under Section 17(a) of
the Securities Exchange Act of 1934, as amended, its successor or successors and
its nominee or nominees, in which the Custodian is hereby specifically
authorized to make deposits. The term "Depository" shall further mean and
include
any other person to be named in a Certificate authorized to act as a
depository under the 1940 Act, its successor or successors and its nominee or
nominees.
(h) "Fund Accountant" shall mean the person appointed by the Company who
performs the daily calculations of the net asset values of the Portfolio and
determines the amount of cash available in the Portfolio on a daily basis for
investment. The Fund Accountant shall be identified to the Custodian in writing.
(i) "Money Market Security" shall be deemed to include, without limitation,
debt obligations issued or guaranteed as to interest and principal by the
Government of the United States or agencies or instrumentalities thereof,
commercial paper, bank certificates of deposit, bankers' acceptances and
short-term corporate obligations each of which will qualify as a first tier
security under Rule 2a-7 of the 1940 Act, where the purchase or sale of such
securities normally requires settlement in federal funds on the same day as such
purchase or sale, and repurchase agreements with respect to any of the foregoing
types of securities.
(j) "Oral Instructions" shall mean an oral communication actually received
by the Custodian from a person reasonably believed by the Custodian to be an
Authorized Person.
(k) "Portfolio" refers to the Amerindo Technology Fund or any such other
separate and distinct investment portfolio as may from time to time be created
and designated by the Company in accordance with the provisions of the Articles
of Incorporation and Certificate of Designation and which the Company and the
Custodian shall have agreed in writing shall be subject to this Agreement
pursuant to the provisions of Section 5(b).
(l) "Prospectus" shall mean the Company's current prospectus and statement
of additional information relating to the registration of the Portfolio's Shares
under the Securities Act of 1933, as amended.
(m) "Shares" refers to the shares of common stock of the Portfolio.
(n) "Security" or "Securities" shall be deemed to include bonds,
debentures, notes, stocks, shares, evidences of indebtedness, and other
securities, commodity interests and investments from time to time owned by the
Portfolio.
(o) "Sub-Custodian" shall mean and include (i) any branch of the Custodian,
(ii) any branch of a "qualified U. S. bank," as that term is defined in Rule
00x-0 xxxxx xxx 0000 Xxx, (xxx) any "eligible foreign custodian," as that term
is defined in Rule 17f-5 under the 1940 Act, approved by the Board of Directors
and having a contract with the Custodian which contract has been approved by the
Board of Directors, and (iv) any securities depository or clearing agency,
incorporated, or organized under the laws of a country other than the United
States, which operates the central system for handling of securities or
equivalent book-entries in that country or a transnational system for the
central handling of securities or equivalent book-entries, which securities
depository or clearing agency has been approved
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by the Board of Directors; provided, that the Custodian or a Sub-Custodian has
entered into an agreement with such securities depository or clearing agency.
(p) "Transfer Agent" shall mean the person which performs as the transfer
agent, dividend disbursing agent and shareholder servicing agent for the
Company.
(q) "Written Instructions" shall mean a written communication actually
received by the Custodian from a person reasonably believed by the Custodian to
be an Authorized Person by any system whereby the receiver of such communication
is able to verify through codes or otherwise with a reasonable degree of
certainty the authenticity of the sender of such communication; however,
"Written Instructions" from the Company to the Custodian shall mean a facsimile
or an electronic communications transmitted by fund accountants, transfer agents
and/or the manager(s) (who have been provided an access code by the Company) and
actually received by the Custodian. Except as otherwise provided in this
Agreement, "Written Instructions" may include instructions given on a standing
basis.
2. APPOINTMENT OF CUSTODIAN.
(a) The Company hereby constitutes and appoints the Custodian as custodian
of all the Securities and monies owned by or in the possession of the Portfolio
during the period of this Agreement.
(b) The Custodian hereby accepts appointment as such custodian and agrees
to perform the duties thereof as hereinafter set forth.
3. APPOINTMENT AND REMOVAL OF SUB-CUSTODIANS.
(a) The Custodian may appoint one or more Sub-Custodians to act as
Depository or Depositories or as sub-custodian or sub-custodians of Securities
and moneys at any time owned by any Portfolio, upon terms and conditions as are
specified in this Agreement. The Custodian shall oversee the maintenance of any
Securities or moneys of any Portfolio by any Sub-Custodian.
(b) If, after the initial approval of Sub-Custodians by the Board of
Directors in connection with this Agreement, the Custodian wishes to appoint
other Sub-Custodians to hold property of the Portfolio, it will so notify the
Company and provide it with information reasonably necessary to determine any
such new Sub-Custodian's eligibility under Rule 17f-5 under the 1940 Act,
including a copy of the proposed agreement with such Sub-Custodian. The Company
shall at the meeting of the Board of Directors next following receipt of such
notice and information give a written approval or disapproval of the proposed
action.
(c) The Agreement between the Custodian and each Sub-Custodian acting
hereunder shall contain the required provisions set forth in Rule,
17f-5(a)(1)(iii).
(d) If the Custodian intends to remove any Sub-Custodian previously
approved by the Board of Directors, it shall so notify the Company and move the
property of the Portfolio deposited with such Sub-Custodian to another
Sub-Custodian previously approved by the Board of Directors.
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The Custodian shall promptly take such steps as may be required to remove any
Sub-Custodian that has ceased to meet the requirements of Rule 17f-5 under the
1940 Act.
(e) The Custodian hereby warrants to the Company that in its opinion, after
due inquiry, the established procedures to be followed by each Sub-Custodian
(that is not being used as a foreign securities depository or clearing agency)
in connection with the safekeeping of property of the Portfolio pursuant to this
Agreement afford protection for such property not materially different from that
afforded by the Custodian's established safekeeping procedures with respect to
similar property held by it (and its securities depositories) in Chicago,
Illinois.
4. USE OF SUB-CUSTODIANS.
With respect to property of a Portfolio which is maintained by the
Custodian in the custody of a Sub-Custodian pursuant to Section 3:
(a) The Custodian will identify on its books as belonging to the Portfolio
any property held by such Sub-Custodian.
(b) In the event that a Sub-Custodian permits any of the Securities placed
in its care to be held in an eligible foreign securities depository, such
Sub-Custodian 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 as a
custodian for its customers.
(c) Any Securities held by a Sub-Custodian will be subject only to the
instructions of the Custodian or its agents; and any Securities held in an
eligible foreign securities depository for the account of a Sub-Custodian will
be subject only to the instructions of such Sub-Custodian.
(d) The Custodian will only deposit property of a Portfolio in an account
with a Sub-Custodian which includes exclusively the assets held by the Custodian
for its customers, and will cause such account to be designated by such
Sub-Custodian as a special custody account for the exclusive benefit of
customers of the Custodian.
5. COMPENSATION.
(a) The Company will compensate the Custodian for its services rendered
under this Agreement in accordance with the fees set forth in the Fee Schedule
annexed hereto as Schedule B and incorporated herein for the existing Portfolio.
Such Fee Schedule does not include out-of-pocket disbursements of the Custodian
for which the Custodian shall be entitled to xxxx separately. Out-of-pocket
disbursements may include only the items specified in Schedule B and which may
be modified by the Custodian if the Company consents in writing to the
modification.
(b) The parties hereto will agree upon the compensation for acting as
Custodian for any Portfolio hereafter established and designated, and at the
time that the Custodian commences serving as such for said Portfolio, such
agreement shall be reflected in a Fee Schedule for that Portfolio, dated and
signed by an officer of each party hereto, which shall be attached to Schedule B
of this Agreement.
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(c) Any compensation agreed to hereunder may be adjusted from time to time
by attaching to Schedule B of this Agreement a revised Fee Schedule, dated and
signed by an officer of each party hereto.
(d) The Custodian will xxxx the Company for its services to the Portfolio
hereunder as soon as practicable after the end of each calendar quarter, and
said xxxxxxxx will be, detailed in accordance with the Fee Schedule for the
Company. The Company will promptly pay to the Custodian the amount of such
billing. The Custodian shall have a claim of payment against the property in the
Portfolio for any compensation or expense amount owing to the Custodian in
connection with the Portfolio from time to time under this Agreement.
(e) The Custodian (not the Company) will be responsible for the payment of
the compensation of each Sub-Custodian.
6. CUSTODY OF CASH AND SECURITIES.
(a) RECEIPT AND HOLDINGS OF ASSETS. The Company will deliver or cause to be
delivered to the Custodian and the Sub-Custodians all Securities and monies
owned by the Portfolio at any time during the period of this Agreement and shall
specify the Portfolio to which the Securities and monies are to be specifically
allocated. The Custodian will not be responsible for such Securities and monies
until actually received by it or by a Sub-Custodian. The Company shall instruct
the Custodian from time to time in its sole discretion, by means of Written
Instructions, as to the manner in which and in what amounts Securities, and
monies of the Portfolio are to be deposited on behalf of the Portfolio in the
Book-Entry System or a Depository; provided, however, that prior to the deposit
of Securities of the Portfolio in the Book-Entry System or a Depository,.
including a deposit in connection with the settlement of the purchase or sale,
the Custodian shall have received a Certificate specifically approving such
deposits by the Custodian or a Sub-Custodian in the Book-Entry System or a
Depository. Securities and monies of the Portfolio deposited in the Book-Entry
System or a Depository will be deposited in accounts which include only assets
held by the Custodian for its customers.
(b) ACCOUNTS AND DISBURSEMENTS. The Custodian shall establish and maintain
a separate account for the Portfolio and shall credit to the separate account
all monies received by it or a Sub-Custodian for the account of such Portfolio
and shall disburse, or cause a Sub-Custodian to disburse, the same only:
1. In payment for Securities purchased for the Portfolio, as provided
in Section 7 hereof;
2. In payment of dividends or distributions with respect to the Shares
of such Portfolio, as provided in Section 10 hereof;
3. In payment of original issue or other taxes with respect to the
Shares of such Portfolio, as provided in Section 11(c) hereof;
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4. In payment for Shares which have been redeemed by such Portfolio,
as provided in Section 11 hereof;
5. In payment of fees and in reimbursement of the expenses and
liabilities of the Custodian attributable to the Company, as provided in
Sections 5 and 15(h) hereof;
6. Pursuant to Written Instructions setting forth the name of
Portfolio and the name and address of the person to whom the payment is to
be made, the amount to be paid and the purpose for which payment is to be
made.
(c) FAIL FLOAT. In the event that any payment made for the Portfolio under
this Section 6 exceeds the funds available in the Portfolio's account, the
Custodian or relevant Sub-Custodian, as the case may be, may, in its discretion,
advance the Company on behalf of the Portfolio an amount equal to such excess
and such advance shall be deemed an overdraft from the Custodian or such
Sub-Custodian to the Portfolio payable on demand, bearing interest at the rate
of interest customarily charged by the Custodian or such Sub-Custodian on
similar overdrafts.
(d) CONFIRMATION AND STATEMENTS. Promptly after the close of business an
each business day, the Custodian shall furnish the Company with confirmations
and a summary of all transfers to or from the account of the portfolio during
said day. Such summary shall include without limitation, as to property acquired
for the Portfolio, the identity of the entity having physical possession of such
property. Where securities purchased by the Portfolio are in a fungible bulk of
securities registered in the name of the Custodian (or its nominee) or shown on
the Custodian's account on the books of a Depository, the Book-Entry System or a
Sub-Custodian, the Custodian shall by book entry or otherwise identify the
quantity of those securities belonging to the Portfolio. At least monthly, the
Custodian shall furnish the Company with a detailed statement of the Securities
and monies held by it and all Sub-Custodians for the Portfolio. In the, absence
of the filing in writing with the Custodian by the Company of exceptions or
objections to any such statement within 90 days after the date that a material
defect is reasonably discoverable, the Company shall be deemed to have approved
such statement; and in such case or upon written approval of the Company of any
such statement the Custodian shall, to the extent permitted by law and provided
the Custodian has met the standard of care in Section 14 hereof, be released,
relieved and discharged with respect to all matters and things set forth in such
statement the as though such statement had been settled by the decree of a court
of competent jurisdiction in an action in which the Company and all persons
having any equity interest in the Company were parties.
(e) REGISTRATION OF SECURITIES AND PHYSICAL SEPARATION. All Securities held
for the Portfolio which are issued or issuable only in bearer form, except such
Securities as are held in the Book-Entry System, shall be held by the Custodian
or a Sub-Custodian in that form; all other Securities held for the Portfolio may
be registered in the name of the Portfolio, in the name of any duly appointed
registered nominee of the Custodian or a Sub-Custodian as the Custodian or such
Sub-Custodian may from time to time determine, or in the name of the Book-Entry
System or a Depository or their successor or successors, or their nominee or
nominees. The Company reserves the right to instruct the Custodian as to the
method of registration and safekeeping of the Securities. The Company agrees to
furnish to the Custodian appropriate instruments to enable the Custodian or any
Sub-Custodian to hold or deliver in
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proper form for transfer, or to register in the name of its registered nominee
or in the name of the Book-Entry System or a Depository, any Securities which
the Custodian or a Sub-Custodian may hold for the account of the Portfolio and
which may from time to time be registered in the name of the Portfolio. The
Custodian shall hold all such Securities specifically allocated to the Portfolio
which are not held in the Book-Entry System or a Depository in a separate
account for the Portfolio in the name of the Portfolio physically segregated at
all times from those of any other person or persons.
(f) SEGREGATED ACCOUNTS. Upon receipt of a Written Instruction, the
Custodian will establish segregated accounts on behalf of the Portfolio to hold
liquid or other assets as it shall be directed by a Written Instruction and
shall increase or decrease the assets in such Segregated Accounts only as it
shall be directed by subsequent Written Instruction.
(g) COLLECTION OF INCOME AND OTHER MATTERS AFFECTING SECURITIES. Unless
otherwise instructed to the contrary by a Written Instruction, the Custodian, by
itself or through the use of the Book-Entry System or a Depository with respect
to Securities therein deposited, shall, or shall instruct the relevant
Sub-Custodian to:
1. Collect all income due or payable with respect to Securities held
for the Portfolio in accordance with this Agreement;
2. Present for payment and collect the amount payable upon all
Securities which may mature or be called, redeemed or retired, or otherwise
become payable;
3. Surrender Securities in temporary form for definitive Securities;
4. Execute any necessary declarations or certificates of ownership
under the federal income tax laws or the laws or regulations of any other
taxing authority now or hereafter in effect; and
5. Hold directly, or through the Book-Entry System or a Depository
with respect to Securities therein deposited, for the amount of the
Portfolio all rights and similar Securities issued with respect to any
Securities held by the Custodian or relevant Sub-Custodian for the
Portfolio.
If the Custodian or any Sub-Custodian causes the account of the
Portfolio to be credited on the payable date for interest, dividends
or redemptions, the Portfolio will promptly return to the Custodian
any such amount or property so credited upon oral or written
notification that neither the Custodian nor the relevant Sub-Custodian
can collect such amount or property in the ordinary course of
business. The Custodian or such Sub-Custodian, as the case may be,
shall have no duty or obligation to institute legal proceedings, file
a claim or proof of claim in any insolvency proceeding or take any
other action with respect to the collection of such amount or property
beyond reasonable commercial collection procedures unless it is
specifically requested to do so by the Company and indemnified to its
satisfaction for any liability, cost or expense arising therefrom.
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(h) DELIVERY OF SECURITIES AND EVIDENCE OF AUTHORITY. Upon receipt of a
Written Instruction and not otherwise, except for subparagraphs 5, 6, 7, and 8
of this section 6(h) which may be effected by Oral or Written Instructions, the
Custodian, directly or through the use of the Book-Entry System or a Depository,
shall, or shall instruct the relevant Sub-Custodian to:
1. Execute and deliver or cause to be executed and delivered to such
persons as may be designated in such Written Instructions, proxies,
consents, authorizations, and any other instruments whereby the authority
of the Company as owner of any securities may be exercised;
2. Deliver or cause to be delivered any Securities held for the
Portfolio in exchange for other Securities or cash issued or paid in
connection with the liquidation, reorganization, refinancing, merger,
consolidation or recapitalization of any corporation, or the exercise of
any conversion privilege;
3. Deliver or cause to be delivered any Securities held for the
Portfolio to any protective committee, reorganization committee or other
person in connection with the reorganization, refinancing, merger,
consolidation or recapitalization or sale of assets of any corporation, and
receive and hold under the terms of this Agreement in the separate account
for the Portfolio certificates of deposit, interim receipts or other
instruments or documents as may be issued to it to evidence such delivery;
4. Make or cause to be made such transfers or exchanges of the assets
specifically allocated to the separate account of the Portfolio and take
such other steps as shall be stated in Written Instructions to be for the
purpose of effectuating any duly authorized plan of liquidation,
reorganization, merger, consolidation or recapitalization of the Company;
5. Deliver Securities upon sale of such Securities for the account of
the Portfolio pursuant to Section 7;
6. Deliver Securities upon the receipt of payment in connection with
any repurchase agreement related to such Securities entered into by the
Portfolio;
7. Deliver Securities owned by the Portfolio to the issuer thereof or
its agent when such Securities are called, redeemed, retired or otherwise
become payable; provided, however, that in any such case the cash or other
consideration is to be delivered to the Custodian or Sub-Custodian, as the
case may be;
8. Deliver Securities for delivery in connection with any loans of
securities made by the Portfolio but only against receipt of adequate
collateral as agreed upon from time to time by the Custodian and the
Company which may be in the form of cash or obligations issued by the
United States Government, its agencies or instrumentalities;
9. Deliver Securities for delivery as security in connection with any
borrowings by the Portfolio requiring a pledge of Portfolio assets, but
only against receipt of the amounts borrowed;
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10. Deliver Securities to the Transfer Agent or to the holders of
Shares in connection with distributions in kind, as may be described from
time to time in the Prospectus, in satisfaction of requests by holders of
Shares for repurchase or redemption;
11. Deliver Securities owned by the Portfolio for any purpose
expressly permitted by and in accordance with procedures described in the
Prospectus; and
12. Deliver Securities owned by the Portfolio for any other proper
business purpose, but only upon receipt of, in addition to Written
Instructions, a certified copy of a resolution of the Board of Directors
signed by an Authorized Person and certified by the Secretary of the
Company, specifying the Securities to be delivered, setting forth the
purpose for which such delivery is to be made, declaring such purpose to be
a proper business purpose, and naming the person or persons to whom
delivery of such Securities shall be made.
(i) ENDORSEMENT AND COLLECTION OF CHECKS, ETC. The Custodian is hereby
authorized to endorse and collect all checks, drafts or other orders for the
payment of money received by the Custodian for the account of the Portfolio.
7. PURCHASE AND SALE OF INVESTMENTS OF THE PORTFOLIO.
(a) Promptly after each purchase of Securities for the Portfolio, the
Company shall deliver to the Custodian (i) with respect to each purchase of
Securities which are not Money Market Securities, a Written Instruction and (ii)
with respect to each purchase of Money Market Securities, either a Written
Instruction or Oral Instruction, in either case specifying with respect to each
purchase: (1) the name of the Portfolio to which such Securities are to be
specifically allocated; (2) the name of the issuer and the title of the
Securities; (3) the number of shares or the principal amount purchased and
accrued interest, if any; (4) the date of purchase and settlement; (5) the
purchase price per unit; (6) the total amount payable upon such Purchase; and
(7) the name of the person from whom or the broker through whom the purchase was
made, if any. The Custodian or specified Sub-Custodian shall receive the
Securities purchased by or for the Portfolio and upon receipt thereof shall pay
to the broker or other person designated by the Company out of the monies held
for the account of the Portfolio the total amount payable upon such purchase,
provided that the same conforms to the total amount payable as set forth in such
Written or Oral Instruction.
(b) Promptly after each sale of Securities of the Portfolio, the Company
shall deliver to the Custodian (i) with respect to the sale of Securities which
are not Money Market Securities, a Written Instruction, and (ii) with respect to
each sale of Money Market Securities, either Written Instructions or Oral
Instructions, in either case specifying with respect to such sale: (1) the name
of the Portfolio to which the Securities sold were specifically allocated; (2)
the name of the issuer and the title of the Securities; (3) the number of shares
or principal amount sold, and accrued interest, if any, (4) the date of sale;
(5) the sale price per unit; (6) the total amount payable to the Portfolio upon
such sale; and (7) the name of the broker through whom or the person to whom the
sale was made. The Custodian or relevant Sub-Custodian shall deliver or cause to
be delivered the Securities to the broker or other person designated by the
Company upon receipt of the total amount payable to the Portfolio upon such
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sale, provided that the same conforms to the total amount payable to the
Portfolio as set forth in such Written or Oral Instruction. Subject to the
foregoing, the Custodian or relevant Sub-Custodian may accept payment in such
form as shall be satisfactory to it, and may deliver Securities and arrange for
payment in accordance with the customs prevailing among dealers in Securities.
(c) Notwithstanding (a) and (b) above, cash in the Portfolio may be
invested by the Custodian for short term purposes pursuant to standing Written
Instructions from the Company.
(d) If the Custodian or any Sub-Custodian causes the account of the
Portfolio to be created or debited on contractual settlement date with cash or
Securities in connection with any sale, exchange or purchase prior to receipt
and reconciliation, the Custodian or such Sub-Custodian, as the case may be, may
reverse such credit or debit if the related transaction fails to settle within a
reasonable period of time or if securities delivered by the Custodian or
Sub-Custodian are returned by the recipient. Upon oral or written notification
to the Portfolio of a credit reversal pursuant to this section 7(d), the
Portfolio will promptly return to the Custodian any such amount or property so
credited.
8. LENDING OF SECURITIES.
If the Portfolio is permitted by the terms of the Articles of Incorporation
and Certificate of Designation and the Prospectus to lend Securities, then
the Board of Directors may approve a separate written agreement between the
Company and the Custodian authorizing the Custodian to lend such
Securities. Such agreement may provide for the payment of additional
reasonable compensation to the Custodian.
9. INVESTMENT IN FUTURES AND OPTIONS.
The Custodian shall pursuant to Written Instructions (which may be standing
instructions) from an Authorized Person (i) transfer initial margin to a
safekeeping bank or, with respect to options, broker; (ii) pay or demand
variation margin to or from a designated futures commission merchant or
other broker based on daily marking to market calculations and in
accordance with accepted industry practices; and (iii) subject to the
consent of the Custodian, enter into separate procedural, safekeeping or
other agreements with safekeeping banks, futures commission merchants and
other brokers pursuant to which such banks and, in the case of options,
brokers, will act as custodian for initial margin deposits in transactions
involving futures contracts and options. The Custodian shall have no
custodial or investment responsibility for any assets transferred to a
safekeeping bank, futures commission merchant or broker pursuant to this
paragraph.
10. PAYMENT OF DIVIDENDS OR DISTRIBUTIONS.
(a) The Company shall furnish to the Custodian the vote of the Board of
Directors or the Dividend Committee thereof, as the case may be, certified by
the Secretary of the Company (i) authorizing the declaration of distributions
with respect to the Portfolio on a specified periodic basis and authorizing the
Custodian to rely on Oral or Written Instructions specifying the date of the
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declaration of such distribution, the date of payment thereof, the record
date as of which shareholders entitled to payment shall be determined, the
amount payable per Share to the shareholders of record as of the record
date and the total amount payable to the Transfer Agent on the payment
date, or (ii) setting forth the date of declaration of any distribution by
the Portfolio, the date of payment thereof, the record date as of which
shareholders entitled to payment shall be determined, the amount payable
per share to the shareholders of record as of the record date and the total
amount payable to the Transfer Agent on the payment date.
(b) Upon the payment date specified in such vote, Oral Instructions, or
Written Instructions, as the case may be, the Custodian shall pay the total
amount payable to the Transfer Agent out of the monies specifically allocated to
and held for the account of the Portfolio.
11. SALE AND REDEMPTION OF SHARES OF THE COMPANY.
(a) Whenever the Company shall sell any Shares of the Portfolio, the
Company shall deliver or cause to be delivered to the Custodian a Written
Instruction duly specifying:
1. The name of the Portfolio whose Shares were sold;
2. The number of Shares sold, trade date, and price; and
3. The amount of money to be received by the Custodian for the sale of
such Shares.
The Custodian understands and agrees that Written Instructions may be
furnished subsequent to the purchase of Shares of the Portfolio and that
the information contained therein will be derived from the sales of Shares
as reported to the Company by the Transfer Agent.
(b) Upon receipt of such money from the Transfer Agent, the Custodian
shall credit such money to the separate account of the Portfolio specified
in (a)(1) above.
(c) Upon issuance of any Shares of the Portfolio in accordance with
the foregoing provisions of this Section 11, the Custodian shall pay all
original issue or other taxes required to be paid in connection with such
issuance upon the receipt of a Written Instruction specifying the amount to
be paid.
(d) Except as provided hereafter, whenever any Shares of the Portfolio
are redeemed, the Company shall cause the Transfer Agent to promptly
furnish to the Custodian Written Instructions specifying:
1. The name of the Portfolio whose Shares were redeemed;
2. The number of Shares redeemed; and
3. The amount to be paid for the Shares redeemed.
11
The Custodian further understands that the information contained in
such Written Instructions will be derived from the redemption of Shares as
reported to the Company by the Transfer Agent.
(e) Upon receipt from the Transfer Agent of advice setting forth the number
of Shares of the Portfolio being redeemed pursuant to valid instructions as
described in the Prospectus, the Custodian shall make payment to the Transfer
Agent out of the monies specifically allocated to and held for the account of
the Portfolio specified in (d)(1) above of the total amount specified in a
Written Instruction issued pursuant to paragraph (d) of this Section 1l.
12. INDEBTEDNESS.
(a) The Company will cause to be delivered to the Custodian by any bank
(excluding the Custodian) from which the Company borrows money, using Securities
as collateral, a notice or undertaking in the form currently employed by any
such bank setting forth the amount which such bank will loan to the Company
against delivery of a stated amount of collateral. The Company shall promptly
deliver to the Custodian Written Instructions stating with respect to each such
borrowing: (1) the name of the Portfolio for which the borrowing is to be made;
(2) the name of the bank; (3) the amount and terms of the borrowing, which may
be set forth by incorporating by reference an attached promissory note, duly
endorsed by the Company, or other loan agreement; (4) the time and date, if
known, on which the loan is to be entered into (the "borrowing date"); (5) the
date on which the loan becomes due and payable; (6) the total amount payable to
the Company for the separate account of the Portfolio on the borrowing date; (7)
the market value of Securities to be delivered as collateral for such loan,
including the name of the issuer, the title and the number of shares or the
principal amount of any particular Securities; (8) whether the Custodian is to
deliver such collateral through the Book-Entry System or a Depository; and (9) a
statement that such loan is in conformance with the 1940 Act and the Prospectus.
(b) Upon receipt of the Written Instruction referred to in paragraph (a)
above, the Custodian shall deliver on the borrowing date the specified
collateral and the executed promissory note, if any, against delivery by the
lending bank of the total amount of the loan payable, provided that the same
conforms to the total amount payable as set forth in the Written Instruction.
The Custodian may, at the option of the lending bank, keep such collateral in
its possession, but such collateral shall be subject to all rights therein given
the lending bank by virtue of any promissory note or loan agreement. The
Custodian shall deliver as additional collateral in the manner directed by the
Company from time to time such Securities specifically allocated to the
Portfolio as may be specified in Written Instruction to collateralize further
any transaction described in this Section 12. The Company shall cause all
Securities released from collateral status to be returned directly to the
Custodian, and the Custodian shall receive from time to time such return of
collateral as may be tendered to it. In the event that the Company fails to
specify in Written Instruction all of the information required by this Section
12, the Custodian shall not be under any obligation to deliver any Securities.
Collateral returned to the Custodian shall be held hereunder as it was prior to
being used as collateral.
12
13. CORPORATE ACTION
Whenever the Custodian or any Sub-Custodian (other than a foreign
securities depository or clearing agency) receives information concerning
Securities held for the Portfolio which requires discretionary action by
the beneficial owner of the Securities (other than a proxy), such as
subscription rights, bond issues, stock repurchase plans and rights
offerings, or legal notices or other material intended to be transmitted to
Securities holders ("Corporate Actions"), the Custodian will give the
Company notice of such Corporate Actions to the extent that the Custodian's
central corporate actions department has actual knowledge of a Corporate
Action in time to notify its customers.
When a rights entitlement or a fractional interest resulting from a rights
issue, stock dividend, stock split or similar Corporate Action is received
which bears an expiration date, the Custodian will endeavor to obtain
Written or Oral Instructions from the Company, but if such Instructions are
not received in time for the Custodian to take timely action, or actual
notice of such Corporate Action was received too late to seek such
Instructions, the Custodian is authorized to sell, or cause a Sub-Custodian
to sell, such rights entitlement or fractional interest and to credit the
applicable account with the proceeds and to take any other action it deems,
in good faith, to be appropriate, in which case, provided it has met the
standard of care in Section 15 hereof, it shall be held harmless by the
Portfolio involved for any such action.
The Custodian will deliver proxies to the Company or its designated agent
pursuant to special arrangements which may have been agreed to in writing
between the parties hereto. Such proxies shall be executed in the
appropriate nominee name relating to Securities registered in the name of
such nominee but without indicating the manner in which such proxies are to
be voted; and where bearer Securities are involved, proxies will be
delivered in accordance with Written or Oral Instructions from Authorized
Persons.
14. PERSONS HAVING ACCESS OF THE PORTFOLIOS.
(a) No Company or agent of the Company, and no officer, director, employee
or agent of the Company's investment adviser, of any sub-investment adviser of
the Company, or of the Company, shall have physical access to the assets of the
Portfolio held by the Custodian or any Sub-Custodian or be authorized or
permitted to withdraw any investments of the Portfolio, nor shall the Custodian
or any Sub-Custodian deliver any assets of the Portfolio to any such person. No
officer, director, employee or agent of the Custodian who holds any similar
position with the Company's investment adviser, with any sub-investment adviser
of the Company or with the Company shall have access to the assets of the
Portfolio.
(b) Nothing in this Section 14 shall prohibit any officer, employee or
agent of the Company, or any officer, director, employee or agent of the
investment adviser, of any sub-investment adviser of the Company or of the
Company, from giving Oral Instructions or Written Instructions to the Custodian
or executing a Certificate so long as it does not result in delivery of or
access to assets of the Portfolio prohibited by paragraph (a) of this Section
14.
13
(c) The Custodian represents that it maintains a system that is reasonably
designed to prevent unauthorized persons from having access to the assets that
it holds (by any means) for its customers.
15. CONCERNING THE CUSTODIAN.
(a) SCOPE OF SERVICES. The Custodian shall be obligated to perform only
such services as are set forth in this Agreement or expressly contained in a
Certificate, Written Instructions or Oral Instructions given to the Custodian
which are not contrary to the provisions of this Agreement.
(b) STANDARD OF CARE.
1. The Custodian will use reasonable care with respect to its obligations
under this Agreement and the safekeeping of property of the Portfolio. The
Custodian shall be liable to, and shall indemnify and hold harmless the Company
from and against any loss which shall occur as the result of the failure of the
Custodian or a Sub-Custodian (other than a foreign securities depository or
clearing agency) to exercise reasonable care with respect to their respective
obligations under this Agreement and the safekeeping of such property. The
determination of whether the Custodian of Sub-Custodian has exercised reasonable
care in connection with the safekeeping of Portfolio property shall be made in
light of the standards applicable in the usual and customary standard for all
custodians to the Custodian with respect to similar property held by it in
Chicago, Illinois. The determination of whether the Custodian or Sub-Custodian
has exercised reasonable care in connection with their other obligations under
this Agreement shall be made in light of prevailing standards applicable to
professional custodians in the jurisdiction in which such custodial services are
performed. In the event of any loss to the Company by reason of the failure of
the Custodian or a Sub-Custodian (other than a foreign securities depository or
clearing agency) to exercise reasonable care, the Custodian shall be liable to
the Company only to the extent of the Company's direct damages and expenses,
which damages, for purposes of property only, shall be determined based on the
market value of the property which is the subject of the loss at the date such
loss occurred and without reference to any special condition or circumstances.
2. The Custodian will not be responsible for any act, omission, default or
for the solvency of any foreign securities depository or clearing agency
approved by the Board of Directors pursuant to Section (1)(n) or Section 3
hereof.
3. The Custodian will not be responsible for any act, omission, default or
for the solvency of any broker or agent (not referred to in paragraph (b)(2)
above) which it or a Sub-Custodian appoints and uses unless such appointment and
use is made or done negligently. In the event such an appointment and use is
made or done negligently or in bad faith, the Custodian shall be liable to the
Company only for direct damages and expenses (determined in the manner described
in paragraph (b)(1) above) resulting from such appointment and use and, in the
case of any loss due to an act, omission or default of such agent or broker,
only to the extent that such loss occurs as a result of the failure of the agent
or broker to exercise reasonable care ("reasonable care" for this purpose to be
14
determined in light of the prevailing standards applicable to agents or brokers,
as appropriate, in the jurisdiction where services are performed).
4. The Custodian shall be entitled to rely, and may act upon the advice of
counsel (who may be counsel for the Company) on all matters and shall be without
liability for any action reasonably taken or omitted in good faith and without
negligence pursuant to such advice.
5. The Custodian shall be entitled to rely upon any Certificate, notice or
other instrument in writing received by the Custodian and reasonably believed by
the Custodian to be genuine and to be signed by two officers of the Company. The
Custodian shall be entitled to rely upon any Written Instructions or Oral
Instructions actually received by the Custodian pursuant to the applicable
Sections of this Agreement and reasonably believed by the Custodian to be
genuine and to be given by an Authorized Person. The Company agrees to forward
to the Custodian Written Instructions from an Authorized Person confirming such
Oral Instructions in such manner so that such Written Instructions are received
by the Custodian, whether by hand delivery, telex or otherwise, by the close of
business on the same day that such Oral Instructions are given to the Custodian.
The Company agrees that the fact that such confirming instructions are not
received by the Custodian shall in no way affect the validity of the
transactions or enforceability of the transactions hereby authorized by the
Company. The Company agrees that the Custodian shall incur no liability to the
Company in (i) acting upon Oral Instructions given to the Custodian hereunder
concerning such transactions provided such instructions reasonably appear to
have been received from a duly Authorized Person or (ii) deciding not to act
solely upon Oral Instructions, provided that the Custodian shall be required to
contact the giver of such Oral Instructions and request written confirmation
immediately following any such decision not to act.
6. The Custodian shall supply the Company and/or Fund Accountant with such
daily information regarding the cash and securities positions and activity of
the Portfolio as the Custodian and the Company and/or Fund Accountant shall from
time to time agree. It is understood that such information will not be audited
by Custodian and Custodian represents that such information will be the best
information then available to the Custodian. The Custodian shall have no
responsibility whatsoever for the pricing of Portfolio Securities or for the
failure of the Company and/or Fund Accountant to reconcile differences between
the information supplied by the Custodian and information obtained by the
Company and/or Fund Accountant from other sources, including but not limited to
pricing vendors and the Company's investment adviser. Subject to the foregoing,
to the extent that any miscalculation by the Company and/or Fund Accountant of
the Portfolio's net asset value is attributable to the willful misfeasance, bad
faith or negligence of the Custodian (including any Sub-Custodian other than a
foreign securities depository or clearing agency) in supplying or omitting to
supply the Company and/or Fund Accountant with information as aforesaid, the
Custodian shall be liable to the Company for any resulting loss (subject to such
de minimis rule of change in value as the Board of Directors may from time m
time adopt).
(c) LIMIT OF DUTIES. Without limiting the generality of the foregoing, the
Custodian shall be under no duty or obligation to inquire into, and shall not be
liable for:
15
1. The validity of the issue of any Securities purchased by the
Portfolio, the legality of the purchase thereof, or the propriety of the
amount specified by the Company for payment therefor;
2. The legality of the sale of any Securities by the Portfolio or the
propriety of the amount of consideration for which the same are sold;
3. The legality of the issue or sale of any Shares, or the sufficiency
of the amount to be received therefor;
4. The legality of the redemption of any Shares, or the propriety of
the amount to be sold therefor;
5. The legality of the declaration or payment of any distribution of
the Portfolio;
6. The legality of any borrowing.
(d) The Custodian need not maintain any insurance for the exclusive benefit
of the Company, but hereby warrants that as of the date of this Agreement it is
maintaining a bankers Blanket Bond and hereby agrees to notify the Company in
the event that such bond is canceled or otherwise lapses.
(e) Consistent with and without limiting the language contained in Section
15(b), it is specifically acknowledged that the Custodian shall have no duty or
responsibility to:
1. Question Written Instructions or Oral Instructions or make any
suggestions to the Company or an Authorized Person regarding such
Instructions unless the Custodian had actual knowledge that such
person is no longer authorized to give such instructions,
2. Supervise or make recommendations with respect to investments
or the retention of Securities;
3. Subject to Section 15(b)(3) hereof, evaluate or report to the
Company or an Authorized Person regarding the financial condition of
any broker, agent or other party to which Securities are delivered or
payments are made pursuant to this Agreement; or
4. Review or reconcile trade confirmations received from brokers.
(f) AMOUNTS DUE FOR TRANSFER AGENT. The Custodian shall not be under any
duty or obligation to take action to effect collection of any amount due to the
Portfolio from the Transfer Agent nor to take any action to effect payment or
distribution by the Transfer Agent of any amount paid by the Custodian to the
Transfer Agent in accordance with this Agreement.
(g) NO DUTY TO ASCERTAIN AUTHORITY. The Custodian shall not be under any
duty or obligation to ascertain whether any Securities at any time delivered to
or held by it for the Company and
16
specifically allocated to the Portfolio are such as may properly be held by the
Company under the provisions of the Articles of Incorporation and Certificate of
Designation and the Prospectus.
(h) INDEMNIFICATION. The Company agrees to indemnify and hold the Custodian
harmless from all loss, cost, taxes, charges, assessments, claims, and
liabilities (including, without limitation, liabilities arising under the
Securities Act of 1933, the Securities Exchange Act of 1934 and the 1940 Act and
state or foreign securities laws) and expenses (including reasonable attorneys
fees and disbursements) arising directly or indirectly from any action taken or
omitted by the Custodian (i) at the request or on the direction of or in
reliance on the advice of the Company or in reasonable reliance upon the
Prospectus or (ii) upon a Certificate or Oral or Written Instructions; provided,
that the aforegoing indemnity shall not apply to any loss, cost, tax, charge,
assessment, claim, liability or expense to the extent the same is attributable
to the Custodian's or any Sub-Custodian's (other than a foreign securities
depository or clearing agency) negligence, willful misconduct, bad faith or
reckless disregard of duties and obligations under this Agreement or any other
agreement relating to the custody of Company property.
(i) The Company on behalf of the Portfolio involved agrees to hold the
Custodian harmless from any liability or loss resulting from the imposition or
assessment of any taxes or other governmental charges on the Portfolio.
(j) Without limiting the foregoing, the Custodian shall not be liable for
any loss which results from:
1. the general risk of investing, or
2. subject to Section 15(b) hereof, investing or holding property
in a particular country including, but not limited to, losses
resulting from nationalization, expropriation or other governmental
action regulation of the banking or securities industry; currency
restrictions, devaluations or fluctuations; and market conditions
which prevent the orderly execution of securities transactions or
affect the value of property held pursuant to this Agreement.
(k) No xxxxx shall be liable to the other for any loss due to forces beyond
their control including but not limited to strikes or work stoppages, acts of
war or terrorism, insurrection, revolution, nuclear fusion, fission or
radiation, or acts of God.
(l) INSPECTION OF BOOKS AND RECORDS. The books and records of the Custodian
shall be open to inspection and audit at reasonable times by officers and
auditors employed by the Company and by the appropriate employees of the
Securities and Exchange Commission.
(m) ACCOUNTING CONTROL REPORTS. The Custodian shall provide the Company
with any report obtained by the Custodian on the system of internal accounting
control of the Book-Entry System, each Depository, and each Sub-Custodian and
with an annual report on its own systems of internal accounting control.
17
(n) DISASTER RECOVERY. The Custodian represents and warrants that it has in
place, and will maintain, commercially reasonable backup and disaster recovery
procedures.
16. TERM AND TERMINATION.
(a) This Agreement shall become effective on the date first set forth above
(the "Effective Date") and shall continue in effect thereafter as the parties
may mutually agree.
(b) Either of the parties hereto may terminate this Agreement with respect
to the Portfolio by giving to the other party a notice in writing specifying the
date of such termination, which, in case the Company is the terminating party,
shall be not less than 60 days after the date of receipt of such notice or, in
case the Custodian is the terminating party, shall be not less than 90 days
after the date of receipt of such notice. In the event such notice is given by
the Company, it shall be accompanied by a certified vote of the Board of
Directors, electing to terminate this Agreement with respect to the Portfolio
and designating a successor custodian or custodians, which shall be a person
qualified to so act under the 1940 Act.
In the event such notice is given by the Custodian, the Company shall, on
or before the termination date, deliver to the Custodian a certified vote
of the Board of Directors, designating a successor custodian or custodians.
In the absence of such designation by the Company, the Custodian may
designate a successor custodian, which shall be a person qualified to so
act under the 0000 Xxx. If the Company fails to designate a successor
custodian with respect to the Portfolio, the Company shall upon the date
specified in the notice of termination of this Agreement and upon the
delivery by the Custodian of all Securities (other than Securities held in
the Book-Entry System which cannot be delivered to the Company) and monies
then owned by the Portfolio, be deemed to be its own custodian and the
Custodian shall thereby be relieved of all duties and responsibilities
pursuant to this Agreement, other than the duty with respect to Securities
held in the Book-Entry System which cannot be delivered to the Company.
(c) Upon the date set forth in such notice under paragraph (b) of this
Section 16, this Agreement shall terminate to the extent specified in such
notice, and the Custodian shall upon receipt of a notice of acceptance by the
successor custodian on that date deliver directly to the successor custodian all
Securities and monies then held by the Custodian and specifically allocated to
the Portfolio, after deducting all fees, expenses and other amounts for the
payment or reimbursement of which it shall then be entitled with respect to the
Portfolio.
17. LIMITATION OF LIABILITY.
The Company and the Custodian agree that the obligations of the Company
under this Agreement shall not be binding upon any of the Directors,
shareholders, nominees, officers, employees or agents, whether past,
present or future, of the Company individually, but are binding only upon
the assets and property of the Company or of the Portfolio thereof. The
execution and delivery of this Agreement have been authorized by the Board
of Directors of the Company, and signed by an authorized officer of the
Company, acting as such, and neither such
18
authorization by such the Board of Directors nor such execution and
delivery by such officer shall be deemed to have been made by any of them
or any shareholder of the Company individually or to impose any liability
on any of them or any shareholder of the Company personally, but shall bind
only the assets and property of the Company or of the Portfolio thereof.
18. MISCELLANEOUS.
(a) Annexed thereto as Schedule A is a certification signed by two of the
present officers of the Company setting forth the names and the signatures of
the present Authorized Persons. The Company agrees to furnish to the Custodian a
new certification (or other written notice) in the event that any such present
Authorized Person ceases to be such an Authorized Person or in the event that
other or additional Authorized Persons are elected or appointed. Until such new
certification (or other written notice) shall be received, the Custodian shall
be fully protected in acting under the provisions of this Agreement upon Oral
Instructions or signatures of the present Authorized Persons as set forth in the
last delivered certification.
(b) Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Custodian, shall be sufficiently given if
addressed to the Custodian and mailed or delivered to it at its offices at its
address stated on the first page hereof or at such other place as the Custodian
may from time to time designate in writing.
(c) Any notice or other instrument in writing, authorized or required by
this Agreement to be given to the Company, shall be sufficiently given if
addressed to the Company and mailed or delivered to it at its offices at its
address shown on the first page hereof or at such other place as the Company may
from time to time designate in writing, with a copy to:
Xxxx X. Xxxxx
Amerindo Funds Inc.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
(d) This Agreement may not be amended or modified in any manner except by a
written agreement executed by both parties with the same formality as this
Agreement, (i) authorized and approved by a vote of the Board of Directors,
including a majority of the members of the Board of Directors who are not
"interested persons" of the Company (as defined in the 1940 Act), or (ii)
authorized and approved by such other procedures as may be permitted or required
by the 1940 Act.
(e) 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 Company without the written
consent of the Custodian, or by the Custodian without the written consent of the
Company authorized or approved by a vote of the Board of Directors, and any
attempted assignment without such written consent shall be null and void.
19
(f) This Agreement shall be construed in accordance with the laws of the
State of New York.
(g) The captions of the 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.
(h) This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.
20
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective representatives duly authorized as of the day and
year first above written.
AMERINDO FUNDS INC.
By: /S/ XXXX X. XXXXX
---------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
THE NORTHERN TRUST COMPANY
By: /S/ XXXXX X. XXXXXX
---------------------------------
Name: Xxxxx X. Xxxxxx
Title: Second Vice President
21
CERTIFICATION
Set forth below are the names and signatures of the Persons Authorized to
sign.
NAME SIGNATURES
Xxxxx Xxxxxx Wild /s/ XXXXX XXXXXX WILD
------------------------------ ------------------------------
Xxxx X. Xxxxx /s/ XXXX X. XXXXX
------------------------------ ------------------------------
------------------------------ ------------------------------
------------------------------ ------------------------------
------------------------------ ------------------------------
Amerindo Technology Fund
Authorized by: /s/ XXXX X. XXXXX
--------------------------------------------------
/s/ XXXXX XXXXXX WILD
--------------------------------------------------
Amendment Dated April 23, 1997
SCHEDULE A
CERTIFICATION
Set forth below are the names and signatures of the Persons Authorized
to sign.
NAME SIGNATURE
Xxxxx Xxxxxx Wild /s/ XXXXX XXXXXX WILD
--------------------------------------------------------------------------------
Xxxx X. Xxxxx /s/ XXXX X. XXXXX
--------------------------------------------------------------------------------
Xxxxxxx Xxxxx /s/ XXXXXXX XXXXX
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxx /s/ XXXXXXX XXXXXX
--------------------------------------------------------------------------------
Amerindo Technology Fund
Authorized by: /s/ XXXX X. XXXXX
--------------------------------------------------
Xxxx X. Xxxxx
/s/ XXXXX XXXXXX WILD
--------------------------------------------------
Xxxxx Xxxxxx Wild
