139999.004
Registration No. 33-20827
Inv. Co. Act No. 811-5518
As filed with the Securities and Exchange Commission on March 6, 1996
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
POST-EFFECTIVE AMENDMENT NO. 33 [X]
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
AMENDMENT NO. 35 [X]
----------------------------------
THE RBB FUND, INC.
(Warburg Pincus Growth & Income Fund: Warburg Pincus Class and Warburg
Pincus Series 2 Class; Warburg Pincus Balanced Portfolio: Warburg Pincus
Class and Warburg Pincus Series 2 Class; Warburg Pincus Tax Free Portfolio:
Warburg Pincus Class; Government Securities Portfolio: RBB Family Class;
BEA International Equity Portfolio: BEA Class; BEA Strategic Fixed Income
Portfolio: BEA Class; BEA Emerging Markets Equity Portfolio: BEA Class; BEA
U.S. Core Equity Portfolio: BEA Class; BEA U.S. Core Fixed Income
Portfolio; BEA Class; BEA Global Fixed Income Portfolio: BEA Class; BEA
Municipal Bond Fund Portfolio; BEA Class; BEA Balanced Fund Portfolio; BEA
Class; BEA Short Duration Portfolio: BEA Class; Numeric Micro Cap Fund;
Numeric Class; Numeric Growth Fund; Numeric Class; Numeric Mid Cap Fund;
Numeric Class; Money Market Portfolio: RBB Family Class, Cash Preservation
Class, Sansom Street Class, Bedford Class, Janney Class, Beta Class, Gamma
Class, Delta Class, Epsilon Class, Zeta Class, Eta Class and Theta Class;
Municipal Money Market Portfolio: RBB Family Class, Cash Preservation
Class, Sansom Street Class, Bedford Class, Bradford Class, Janney Class,
Beta Class, Gamma Class, Delta Class, Epsilon Class, Zeta Class, Eta Class
and Theta Class; Government Obligations Money Market Portfolio: Sansom
Street Class, Bedford Class, Bradford Class, Janney Class, Beta Class,
Gamma Class, Delta Class, Epsilon Class, Zeta Class, Eta Class and Theta
Class; New York Municipal Money Market Portfolio: Bedford Class, Janney
Class, Beta Class, Gamma Class, Delta Class, Epsilon Class, Zeta Class, Eta
Class and Theta Class)
------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
Bellevue Park Corporate Center
400 Bellevue Parkway
Suite 100
Wilmington, DE 19809
(Address of Principal Executive Offices)
----------------------------------------
Registrant's Telephone Number: (302) 792-2555
Copies to:
GARY M. GARDNER, ESQUIRE JOHN N. AKE, ESQUIRE
PNC Bank, National Association Ballard Spahr Andrews & Ingersoll
Broad and Chestnut Streets 1735 Market Street, 51st Floor
Philadelphia, PA 19101 Philadelphia, PA 19101
(Name and Address of
Agent for Service)
Approximate Date of Proposed Public Offering: as soon as possible after
effective date of registration statement.
It is proposed that this filing will become effective (check appropriate
box)
_______immediately upon filing pursuant to paragraph (b)
_______on _______________ pursuant to paragraph (b)
_______60 days after filing pursuant to paragraph (a)(1)
_______on ______________ pursuant to paragraph (a)(1)
X 75 days after filing pursuant to paragraph (a)(2)
_______
_______on_______________ pursuant to paragraph (a)(2) of rule 485
If appropriate, check following box:
_______ this post-effective amendment designates a new
effective date for a previously filed
post-effective amendment.
------------------------------
Pursuant to Rule 24f-2 under the Investment Company Act of 1940, Registrant
has elected to register an indefinite number of shares of common stock of each
of the fifty-four classes registered hereby under the Securities Act of 1933.
Registrant filed its notice pursuant to Rule 24f-2 for the fiscal year ended
August 31, 1995 on October 26, 1995.
------------------------------
This document contains a total of ___________ pages.
Exhibit Index appears on page____________.
<PAGE>
194512.001(BF)
THE RBB FUND, INC.
(Numeric Shares of the Numeric Micro Cap Fund, Numeric Growth
Fund and Numeric Mid Cap Fund Portfolios)
Cross Reference Sheet
FORM N-1A ITEM LOCATION
PART A PROSPECTUS
1. Cover Page............................ Cover Page
2. Synopsis.............................. Cover Page;
Introduction; The Funds
3. Condensed Financial Information....... Not Applicable
4. General Description of Registrant..... Cover Page; The Funds;
Investment Objectives
and Policies
5. Management of the Fund................ Management
6. Capital Stock and Other Securities.... Cover Page; Dividends
and Distributions
7. Purchase of Securities Being Offered.. How to Purchase Shares;
Net Asset Value
8. Redemption or Repurchase.............. How to Redeem Shares;
Net Asset Value
9. Legal Proceedings..................... Not Applicable
<PAGE>
PART B STATEMENT OF
ADDITIONAL
INFORMATION
10. Cover Page............................ Cover Page
11. Table of Contents..................... Contents
12. General Information and History....... General; See Prospectus -
"The Fund"
13. Investment Objectives and Policies.... Investment Objectives
and Policies
14. Management of the Fund................ Directors and Officers;
Investment Advisory and
Servicing Arrangements
15. Control Persons and Principal Holders
of Securities...................... Miscellaneous
16. Investment Advisory and Other
Services........................... Investment Advisory and
Servicing Arrangements;
See Prospectus -
"Management"
17. Brokerage Allocation and Other
Practices.......................... Fund Transactions
18. Capital Stock and Other Securities.... Description of Shares;
Additional Information
Concerning Fund Shares;
See Prospectus -
"Dividends and
Distributions" and
"Description of Shares"
19. Purchase, Redemption and Pricing of
Securities Being Offered........... Purchase and Redemption
Information; Valuation
of Shares; See
Prospectus - "How to
Purchase Shares," "How
to Redeem Shares" and
"Distribution of Shares"
20. Tax Status............................ Taxes; See Prospectus -
"Taxes"
21. Underwriters.......................... Not Applicable
22. Calculation of Performance Data....... Performance and Yield
Information
23. Financial Statements Not Applicable
PART C Other Information
Information required to be included in Part C is set forth under the
appropriate item, so numbered in Part C of this Registration Statement.
<PAGE>
187836.009(BF)
THE NUMERIC FAMILY
OF MUTUAL FUNDS
Numeric Micro Cap Fund
Numeric Growth Fund
Numeric Mid Cap Fund
PROSPECTUS
May __, 1996
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS OR IN RBB'S STATEMENT OF
ADDITIONAL INFORMATION INCORPORATED HEREIN BY REFERENCE, IN CONNECTION WITH THE
OFFERING MADE BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY RBB OR ITS DISTRIBUTOR.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING BY RBB OR BY THE DISTRIBUTOR IN
ANY JURISDICTION IN WHICH SUCH OFFERING MAY NOT LAWFULLY BE MADE.
TABLE OF CONTENTS
PAGE
INTRODUCTION.................................................................. 2
FINANCIAL HIGHLIGHTS.......................................................... 6
INVESTMENT OBJECTIVES AND POLICIES............................................ 6
INVESTMENT LIMITATIONS........................................................10
MANAGEMENT....................................................................11
DISTRIBUTION OF SHARES........................................................13
HOW TO PURCHASE SHARES........................................................13
HOW TO REDEEM SHARES..........................................................16
NET ASSET VALUE...............................................................18
DIVIDENDS AND DISTRIBUTIONS...................................................18
TAXES.........................................................................18
DESCRIPTION OF SHARES.........................................................19
OTHER INFORMATION.............................................................20
APPENDIX A - Performance Benchmarks
INVESTMENT ADVISER
Numeric Investors Limited Partnership
Cambridge, Massachusetts
CUSTODIAN
Custodian Trust Company
Princeton, New Jersey
CO-ADMINISTRATOR AND TRANSFER AGENT
PFPC Inc.
Wilmington, Delaware
CO-ADMINISTRATOR
Bear Stearns Funds Management Inc.
New York, New York
DISTRIBUTOR
Counsellors Securities Inc.
New York, New York
COUNSEL
Ballard Spahr Andrews & Ingersoll
Philadelphia, Pennsylvania
INDEPENDENT ACCOUNTANTS
Coopers & Lybrand L.L.P.
Philadelphia, Pennsylvania
<PAGE>
187836.009(BF)
THE NUMERIC FAMILY
of
The RBB Fund, Inc.
The Numeric Family consists of three classes of common stock of The RBB
Fund, Inc. ("RBB"), an open-end management investment company. The shares of
each such class (collectively, the "Numeric Family Shares" or "Shares") offered
by this Prospectus represent interests in one of three investment portfolios of
RBB and are designed to offer a variety of investment opportunities. The
investment objectives of each investment portfolio described in this Prospectus
are as follows:
NUMERIC MICRO CAP FUND--to provide long-term capital appreciation. The
Fund invests generally in common stock of companies with market
capitalization of $500 million or less, although the fund may invest in
companies with higher market capitalization.
NUMERIC GROWTH FUND--to provide long-term capital appreciation. The
Fund invests generally in common stock of companies with smaller ($1
billion or less) market capitalization or companies with substantial equity
capital and higher than average earnings growth rates.
NUMERIC MID CAP FUND--to provide long-term capital appreciation. The
Fund invests generally in common stock of the 151st to the 1000th largest
companies (excluding American Depositary Receipts ("ADRs")) as ranked by
market capitalization (the largest 150 companies ranked by market
capitalization are excluded). This currently represents a market
capitalization range of approximately $800 million to $8 billion.
NUMERIC INVESTORS, L.P. ("NUMERIC"), THE FUNDS' INVESTMENT ADVISER, WILL
MONITOR THE FUNDS' TOTAL ASSETS AND MAY CLOSE ANY OF THE FUNDS AT ANY TIME TO
NEW INVESTMENT DUE TO CONCERNS THAT AN INCREASE IN THE SIZE OF A FUND MAY
ADVERSELY EFFECT THE IMPLEMENTATION OF NUMERIC'S INVESTMENT STRATEGY. NUMERIC
MAY ALSO CHOOSE TO REOPEN A CLOSED FUND TO NEW INVESTMENT AT ANY TIME, AND MAY
SUBSEQUENTLY CLOSE SUCH FUND AGAIN SHOULD CONCERNS REGARDING FUND SIZE RECUR.
SHARES OF THE NUMERIC FAMILY FUNDS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED BY, PNC BANK, NATIONAL ASSOCIATION OR ANY OTHER BANK AND
SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION,
THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY. INVESTMENTS IN NUMERIC FAMILY
SHARES INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
This Prospectus contains information that a prospective investor needs to
know before investing. Please keep it for future reference. A Statement of
Additional Information, dated ________ _, 1996, has been filed with the
Securities and Exchange Commission and is incorporated by reference in this
Prospectus. It may be obtained free of charge from Numeric by calling (800)
NUMERIC [(800) 686-3742].
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
PROSPECTUS ________ _, 1996
<PAGE>
INTRODUCTION
RBB is registered under the Investment Company Act of 1940 (the "1940 Act")
as an open-end management investment company and is currently operating or
proposing to operate seventeen separate investment portfolios. Each of the three
classes of Shares offered by this Prospectus represents interests in one of the
following three investment portfolios (collectively, the "Funds"): Numeric Micro
Cap Fund; Numeric Growth Fund; and Numeric Mid Cap Fund. RBB was incorporated
under the laws of the State of Maryland on February 29, 1988.
WHO SHOULD INVEST: LONG-TERM INVESTORS SEEKING CAPITAL APPRECIATION
The Funds are intended for investors who are seeking long-term capital
appreciation, and who do not need to earn current income from their investment
in the Funds. The net asset values per share of Shares representing interests in
the Funds will fluctuate as the values of the portfolio securities change in
response to changing market prices and other factors. Because of the risks
associated with common stock investments, the Funds are intended to be a
long-term investment vehicle and are not designed to provide investors with a
means of speculating on short-term stock market movements. Investors should be
able to tolerate sudden, sometimes substantial fluctuations in the value of
their investment. Investors who engage in excessive account activity generate
additional costs which are borne by all a Fund's shareholders. In order to
minimize such costs, the Funds reserve the right to reject any purchase request
(including exchange purchases from other Numeric Funds) that is reasonably
deemed to be disruptive to efficient portfolio management, either because of the
timing of the investment or previous excessive trading by the investor.
Additionally, the Funds have adopted exchange privilege limitations as described
in the section "Exchange Privilege Limitations," and also apply a 1% Redemption
Fee or Exchange Fee which is paid to a Fund for redemptions or exchanges of Fund
Shares which have been held for less than two (2) years. Finally, the Funds
reserve the right to suspend the offering of its shares.
Because of these risks, the Funds should not be considered a complete
investment program. Most investors should maintain diversified holdings of
securities with different risk characteristics -- including common stocks, bonds
and money market instruments. Investors may wish to purchase shares on a
regular, periodic basis (Automatic Investing), rather than investing in one lump
sum, in order to reduce the risk of investing all their monies in common stocks
at a particularly unfavorable time. Investors may also wish to complement an
investment in the Fund with other types of common stock investments.
FUND MANAGEMENT
Numeric serves as the investment adviser to the Funds. Numeric specializes
in the active management of U.S. equity portfolios using internally developed
quantitative stock selection and portfolio risk-control techniques, and
currently has over $1.6 billion in assets under management for individual,
limited partnership, mutual fund, pension plan and endowment accounts.
2
<PAGE>
THE FUNDS
The investment objectives and policies of each of the Funds are summarized
in the table below. There is no assurance that a Fund will achieve its
investment objective.
================================================================================
Numeric Investment Performance
Fund Objective/Policy Benchmark*
- --------------------------------------------------------------------------------
Micro Cap Objective is to provide long-term capital Wilshire Small Company
appreciation. Invests primarily in common Growth Index
stock of companies with market
capitalizations of $500 million or less.
- --------------------------------------------------------------------------------
Growth Objective is long-term capital Russell 2500 Growth
appreciation. Invests primarily in common Index
stock of companies with smaller ($1 billion
or less) market capitalization or companies
with substantial equity capital and higher
than average earnings growth rates.
- --------------------------------------------------------------------------------
Mid Cap Objective is long-term capital S&P MidCap 400 Index
appreciation. Invests primarily in common
stocks of the 151st to the 1000th largest
companies (excluding ADRs) as ranked by
market capitalization.
================================================================================
* For more information on a Fund's benchmark, see Appendix A at the back of this
prospectus.
FEE TABLE
The following tables illustrate all expenses and fees (after expected fee
waivers and expenses reimbursements) that a shareholder would incur in each
Fund. The expenses and fees in the tables are based on estimates of expenses
expected to be incurred for the current fiscal year ending August 31, 1996.
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Charge Imposed on Purchases NONE
(as percentage of offering price)
Sales Charge Imposed on Reinvested Dividends NONE
Redemption Fees(1) 1%
Exchange Fees (1)(2) 1%
1 Paid to a Fund for investors who exchange or redeem Fund Shares held for
less than two (2) years. See "How to Purchase Shares -- Exchange Privilege"
and "How to Redeem Shares -- Redemption Fee." Although the Redemption Fee
and Exchange Fee are an expense for the redeeming or exchanging
shareholder, it is a gain to remaining shareholders because it is paid
directly to a Fund.
2 Exchanges are limited to three (3) per year. See "How to Purchase Shares --
Exchange Privilege Limitations."
3
<PAGE>
ANNUAL FUND OPERATING EXPENSES (NUMERIC FAMILY CLASSES)
AFTER EXPENSE REIMBURSEMENTS AND WAIVERS
Numeric Numeric Numeric
Micro Cap Growth Mid Cap
FUND FUND FUND
-------- -------- --------
Management fees
(after waivers)*............... 0% .36% 0%
12b-1 fees (after waivers)....... None None None
Other Expenses
(after waivers and
reimbursements)............... 1.00 .64 1.00
---- --- ----
Total Fund Operating Expenses
(Numeric Family Classes) (after
waivers and reimbursements) 1.00% 1.00% 1.00%
===== ===== =====
* Management fees are based on average daily net assets and are calculated
daily and paid monthly.
The caption "Other Expenses" does not include extraordinary expenses as
determined by use of generally accepted accounting principles.
EXAMPLE
An investor would pay the following expenses on a $1,000 investment in each
of the Funds, assuming (1) a 5% annual return, and (2) redemption at the end of
each time period:
One Three
YEAR YEARS
---- -----
Micro Cap............................... $21 $32
Growth.................................. $21 $32
Mid Cap................................. $21 $32
The Example in the Fee Table assumes that all dividends and distributions
are reinvested and that the amounts listed under "Annual Fund Operating Expenses
(Numeric Family Classes) After Expense Reimbursements and Waivers" remain the
same in the years shown. THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION
OF PAST OR FUTURE INVESTMENT RETURN OR OPERATING EXPENSES AND ACTUAL INVESTMENT
RETURN OR OPERATING EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
The Fee Table is designed to assist an investor in understanding the
various costs and expenses that an investor in any of the Numeric Family Classes
of RBB will bear directly or indirectly. (For more complete descriptions of the
various costs and expenses, see "Management" and "Distribution of Shares"
below.) The Fee Table reflects a voluntary waiver of Management fees for each
Fund. However, there can be no assurance that any future waivers of Management
fees (if any) will not vary from the figures reflected in the Fee Table. In
addition, Numeric is currently voluntarily assuming additional expenses of some
of the Funds. There can be no assurance that Numeric will continue to assume
such expenses. Assumption of additional expenses will have the effect of
lowering a Fund's overall expense ratio and increasing its yield to investors.
4
<PAGE>
"Other Expenses" for the Funds are based on estimated amounts for the current
fiscal year. Absent fee waivers or reimbursements, estimated expenses for the
Funds for the fiscal year ending August 31, 1996 would be as follows:
ANNUAL FUND OPERATING EXPENSES (NUMERIC FAMILY CLASSES)
BEFORE EXPENSE REIMBURSEMENTS AND WAIVERS
Numeric Numeric Numeric
Micro Cap Growth Mid Cap
FUND FUND FUND
----- ---- ----
Management fees............... .75% .75% .75%
12b-1 fees ................... None None None
Other Expenses................ 1.07% .64% 1.07%
----- ---- -----
Total Fund Operating Expenses
(Numeric Family Classes) (before
waivers and reimbursements) 1.82% 1.39% 1.82%
===== ===== =====
The caption "Other Expenses" does not include extraordinary expenses as
determined by use of generally accepted accounting principles.
OFFERING PRICES
Shares that represent interests in the Funds will be offered to the public
at the next determined net asset value after receipt of an order by PFPC Inc.
("PFPC"), the Funds' transfer agent. THE SHARES ARE OFFERED ON A NO-LOAD BASIS:
THERE IS NO SALES CHARGE IMPOSED ON PURCHASES OF SHARES, NOR ARE THE SHARES
SUBJECT TO A 12B-1 FEE.
MINIMUM INITIAL AND SUBSEQUENT INVESTMENTS
The minimum initial investment for each Fund is $3,000. Subsequent
investments must be $100 or more. The minimum initial investment for an
Automatic Investment Plan is $1,000 with minimum monthly payments of $100. The
minimum invested for Individual Retirement Accounts ("IRAs"), or pension,
profit-sharing or other employee benefit plans is $1,000 and minimum subsequent
investments are $100. See "How to Purchase Shares."
EXCHANGES
Shares of a Numeric Family Fund may be exchanged up to three (3) times per
year for Shares of any other Numeric Family Fund at their net asset value (less
an exchange fee of 1% is paid to a Fund for exchanges from such Fund of Shares
held less than two (2) years) next determined after receipt by PFPC of an
exchange request. In addition, RBB reserves the right to impose an
administrative charge for each exchange. See "How to Purchase Shares--Exchange
Privilege" and "Exchange Privilege Limitation."
REDEMPTION PRICE
Shares may be redeemed at any time at their net asset value (less a 1%
redemption fee paid to a Fund for redemptions of Shares of such Fund which have
been held for less than two (2) years) next determined after receipt by PFPC of
a redemption request. RBB reserves the right, upon 30 days' written notice, to
redeem an account in any of the Funds if the net asset value of the investor's
Shares in that account falls below $500 and is not increased to at least such
amount within such 30-day period. See "How to Redeem Shares."
5
<PAGE>
CERTAIN FACTORS TO CONSIDER
An investment in any of the Funds is subject to certain risks, as set forth
in detail under "Investment Objectives and Policies." As with other mutual
funds, there can be no assurance that any Fund will achieve its objective. Some
or all of the Funds, to the extent set forth under "Investment Objectives and
Policies," may engage in the following investment practices: short sales,
borrowings, the lending of portfolio securities and engaging in options and
futures transactions. All of these transactions involve certain special risks,
as set forth under "Investment Objectives and Policies."
SHAREHOLDER INQUIRIES
Any questions or communications regarding a shareholder account should be
directed to PFPC, Bellevue Park Corporate Center, 400 Bellevue Parkway,
Wilmington, Delaware 19809, toll-free (800) 447-1139 (in Delaware call collect
(302) 791-1149).
Information on Numeric is available by calling 1-800-NUMERIC
[1-800-686-3742]. Information is also available on the Internet through the
World Wide Web. Shareholders and investment professionals may access information
on Numeric by accessing http://www.numeric.com.
FINANCIAL HIGHLIGHTS
No financial data is supplied for the Funds because, as of the date of this
Prospectus, the Funds had no performance
history.
INVESTMENT OBJECTIVES AND POLICIES
To meet its investment objective, each Fund employs a specific investment
style, as described below. There is no assurance that a Fund will achieve its
investment objective.
The investment objective of the NUMERIC MICRO CAP FUND is to provide
long-term capital appreciation. The Fund will invest primarily in common stocks,
although it may also invest in securities which are convertible into common
stock, fixed income securities and money market securities. Under normal
circumstances, the Fund will invest at least 65% of its total assets in common
stock of companies with market capitalization of $500 million or less, although
the Fund may invest in companies with higher market capitalization. The Fund
will measure its performance against the Wilshire Small Company Growth Index.
The investment objective of the NUMERIC GROWTH FUND is to provide long-term
capital appreciation. The Fund will invest primarily in common stocks, although
it may also invest in securities which are convertible into common stock, fixed
income securities and money market securities. Under normal circumstances, the
Fund will invest in common stock of companies with smaller ($1 billion or less)
market capitalization or companies with substantial equity capital and higher
than average earnings growth rates. The Fund will measure its performance
against the Russell 2500 Growth Index.
The investment objective of the NUMERIC MID CAP FUND is to provide
long-term capital appreciation. The Fund will invest primarily in common stocks,
although it may also invest in securities which are convertible into common
stock, fixed income securities and money market securities. Under normal
circumstances, the Fund will invest at least 65% of its total assets in common
stock of the 151st to the 1000th largest companies (excluding ADRs) as ranked by
market capitalization (the largest 150 companies ranked by market capitalization
are excluded). This currently represents a market capitalization range of
approximately $800 million to $8 billion. The Fund will measure its performance
against the S&P MidCap 400 Index.
6
<PAGE>
NUMERIC'S INVESTMENT STYLE. Numeric employs a quantitative approach to
investment management. Numeric relies on proprietary quantitative computer
models utilizing internally developed computer technology and financial
databases to assist in the stock selection process. Numeric's proprietary models
are capable of ranking a large universe of eligible investments using a wide
array of financial data such as market price, book value, earnings, cash flow
and earnings growth rates. The models also evaluate the degree to which
independent research analysts are changing their earnings forecasts for the
companies they follow. Stocks are ranked according to their relative
attractiveness as determined by these factors. These rankings assist Numeric in
constructing a portfolio it believes is invested in the most attractive
securities consistent with the Fund's investment objectives. The same investment
strategy used to manage a particular Fund also may be used for institutional
accounts managed by Numeric. These models may be changed periodically to capture
the insights of Numeric's ongoing research effort.
In pursuing the investment objectives of each of the Funds, Numeric will
use the investment instruments and techniques discussed below:
OPTIONS AND FUTURES. The Funds may write covered call options, buy put
options, buy call options and write put options, without limitation except as
noted in this paragraph. Such options may relate to particular securities or to
various indexes and may or may not be listed on a national securities exchange
and issued by the Options Clearing Corporation. The Funds may also invest in
futures contracts and options on futures contracts (index futures contracts or
interest rate futures contracts, as applicable) for hedging purposes or for
other purposes so long as aggregate initial margins and premiums required for
non-hedging positions do not exceed 5% of its net assets, after taking into
account any unrealized profits and losses on any such contracts it has entered
into.
Options trading is a highly specialized activity which entails greater than
ordinary investment risks. A call option for a particular security gives the
purchaser of the option the right to buy, and a writer the obligation to sell,
the underlying security at the stated exercise price at any time prior to the
expiration of the option, regardless of the market price of the security. The
premium paid to the writer is in consideration for undertaking the obligations
under the option contract. A put option for a particular security gives the
purchaser the right to sell the underlying security at the stated exercise price
at any time prior to the expiration date of the option, regardless of the market
price of the security. In contrast to an option on a particular security, an
option on an index provides the holder with the right to make or receive a cash
settlement upon exercise of the option. The amount of this settlement will be
equal to the difference between the closing price of the index at the time of
exercise and the exercise price of the option expressed in dollars, times a
specified multiple.
The Funds will engage in unlisted over-the-counter options only with
broker-dealers deemed creditworthy by Numeric. Closing transactions in certain
options are usually effected directly with the same broker-dealer that effected
the original option transaction. The Funds bear the risk that the broker-dealer
will fail to meet its obligations. There is no assurance that the Funds will be
able to close an unlisted option position. Furthermore, unlisted options are not
subject to the protections afforded purchasers of listed options by the Options
Clearing Corporation, which performs the obligations of its members who fail to
do so in connection with the purchase or sale of options.
To enter into a futures contract, the Funds must make a deposit of an
initial margin with its custodian in a segregated account in the name of its
futures broker. Subsequent payments to or from the broker, called variation
margin, will be made on a daily basis as the price of the underlying security or
index fluctuates, making the long and short positions in the futures contracts
more or less valuable.
The risks related to the use of options and futures contracts include: (i)
the correlation between movements in the market price of a Fund's investments
(held or intended for purchase) being hedged and in the price of the futures
contract or option may be imperfect; (ii) possible lack of a liquid secondary
market for closing out options or futures positions; (iii) the need for
additional portfolio management skills and techniques; and (iv) losses due to
unanticipated market movements. Successful use of options and futures by the
Funds is
7
<PAGE>
subject to Numeric's ability to correctly predict movements in the
direction of the market. For example, if a Fund uses future contracts as a hedge
against the possibility of a decline in the market adversely affecting
securities held by it and securities prices increase instead, the Fund will lose
part or all of the benefit of the increased value of its securities which it has
hedged because it will have approximately equal offsetting losses in its futures
positions. The risk of loss in trading futures contracts in some strategies can
be substantial, due both to the low margin deposits required, and the extremely
high degree of leverage involved in future pricing. As a result, a relatively
small price movement in a futures contract may result in immediate and
substantial loss or gain to the investor. Thus, a purchase or sale of a futures
contract may result in losses or gains in excess of the amount invested in the
contract. For a further discussion see "Investment Objectives and Policies" in
the Statement of Additional Information.
SHORT SALES. Short sales are transactions in which a Fund sells a security
it does not own in anticipation of a decline in the market value of that
security. To complete such a transaction, the Fund must borrow the security to
make delivery to the buyer. The Fund then is obligated to replace the security
borrowed by purchasing it at the market price at the time of replacement. The
price at such time may be more or less than the price at which the security was
sold by the Fund. Until the security is replaced, the Fund is required to pay to
the lender amounts equal to any dividend which accrues during the period of the
loan. To borrow the security, the Fund also may be required to pay a
premium,which would increase the cost of the security sold. The proceeds of the
short sale will be retained by the broker, to the extent necessary to meet
margin requirements, until the short position is closed out.
Until a Fund replaces a borrowed security in connection with a short sale,
the Fund will: (a) maintain daily a segregated account, containing cash, cash
equivalents or U.S. Government securities, at such a level that (i) the amount
deposited in the account plus the amount deposited with the broker as collateral
will equal the current value of the security sold short and (ii) the amount
deposited in the segregated account plus the amount deposited with the broker as
collateral will not be less than the market value of the security at the time it
was sold short; or (b) otherwise cover its short position in accordance with
positions taken by the Staff of the Securities and Exchange Commission.
A Fund will incur a loss as a result of the short sale if the price of the
security increases between the date of the short sale and the date on which the
fund replaces the borrowed security. The Fund will realize a gain if the
security declines in price between those dates. This result is the opposite of
what one would expect from a cash purchase of a long position in a security. The
amount of any gain will be decreased, and the amount of any loss increased, by
the amount of any premium or amounts in lieu of interest the Fund may be
required to pay in connection with a short sale. The Fund may purchase call
options to provide a hedge against an increase in the price of a security sold
short by the Fund. See "Options and Futures Contracts" above.
The Funds anticipate that the frequency of short sales will vary
substantially in different periods, and they do not intend that any specified
portion of their assets, as a matter of practice, will be invested in short
sales. However, no securities will be sold short if, after effect is given to
any such short sale, the total market value of all securities sold short would
exceed 25% of the value of a Fund's net assets. A Fund may not sell short the
securities of any single issuer listed on a national securities exchange to the
extent of more than 5% of the value of its net assets. A Fund may not sell short
the securities of any class of an issuer to the extent, at the time of the
transaction, of more than 2% of the outstanding securities of that class.
In addition to the short sales discussed above, the Funds may make short
sales "against the box," a transaction in which a Fund enters into a short sale
of a security which the Fund owns. The proceeds of the short sale will be held
by a broker until the settlement date at which time the Fund delivers the
security to close the short position. The Fund receives the net proceeds from
the short sale. It currently is anticipated that the Funds will make short sales
against the box for purposes of protecting the value of the Funds' net assets.
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LENDING OF FUND SECURITIES. The Funds may lend their portfolio securities
to financial institutions. Such loans would involve risks of delay in receiving
additional collateral in the event the value of the collateral decreased below
the value of the securities loaned or of delay in recovering the securities
loaned or even loss of rights in the collateral should the borrower of the
securities fail financially. However, loans will be made only to borrowers which
Numeric deems to be of good standing and only when, in Numeric's judgment, the
income to be earned from the loans justifies the attendant risks.
PORTFOLIO TURNOVER. The Funds may be subject to a greater degree of
turnover and thus a higher incidence of short-term capital gains taxable as
ordinary income than might be expected from portfolios which invest
substantially all of their funds on a long-term basis, and correspondingly
larger mark-up charges can be expected to be borne by such Funds. Federal income
tax law may restrict the extent to which such Funds may engage in short-term
trading activities. See "Taxes" in the Statement of Additional Information for a
discussion of such federal income tax law restrictions. The Funds anticipate
that the annual turnover in the Funds will range from 150% to 300% or more
depending on market conditions. Such turnover rates are greater than that of
many other investment companies.
MICRO CAP AND SMALL CAP STOCKS. Securities of companies with micro and
small capitalizations tend to be riskier than securities of companies with
medium or large capitalizations. This is because micro and small cap companies
typically have smaller product lines and less access to liquidity than mid cap
or large cap companies, and are therefore more sensitive to economic downturns.
In addition, growth prospects of micro and small cap companies tend to be less
certain than mid or large cap companies, and the dividends paid on micro and
small cap stocks are frequently negligible. Moreover, micro and small cap stocks
have, on occasion, fluctuated in the opposite direction of large cap stocks or
the general stock market. Consequently, securities of micro and small cap
companies tend to be more volatile than those of mid and large cap companies.
BORROWING MONEY. As a fundamental policy, the Funds are permitted to borrow
to the extent permitted under the 1940 Act and to mortgage, pledge or
hypothecate their respective assets in connection with such borrowings in
amounts not in excess of 125% of the dollar amounts borrowed. The 1940 Act
permits an investment company to borrow in an amount up to 33 % of the value of
such company's total assets. However, the Funds currently intend to borrow money
only for temporary or emergency (not leveraging) purposes, in an amount up to
15% of the value of their respective total assets (including the amount
borrowed) valued at the lesser of cost or market, less liabilities (not
including the amount borrowed) at the time the borrowing is made. While
borrowings exceed 5% of its total assets, the Funds will not make any additional
investments.
DEBT SECURITIES. The Funds may invest in debt securities rated no less than
investment grade by either Standard & Poor's or Moody's. Bonds in the lowest
investment grate debt category (e.g., bonds rated BBB by Standard & Poor's
Corporation or Baa by Moody's Investors Services, Inc.) 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 bonds. The Funds may retain a bond
which was rated as investment grade at the time of purchase but whose rating is
subsequently downgraded below investment grade.
MARKET FLUCTUATION. Because the investment alternatives available to each
Fund may be limited by specific objectives of that Fund, investors should be
aware that an investment in a particular Fund may be subject to greater market
fluctuation than an investment in a portfolio of securities representing a
broader range of investment alternatives. In view of the specialized nature of
the investment activities of each Fund, an investment in any single fund should
not be considered a complete investment program. There is no assurance that any
Fund will achieve its investment objectives.
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SHORT-TERM DEBT OBLIGATIONS. The Funds may purchase money market
instruments to the extent consistent with their investment objectives and
policies. Such instruments include U.S. Government obligations, repurchase
agreements, certificates of deposit, bankers acceptances and commercial paper.
In addition to the above investment instruments and techniques, the Funds
presently intend to invest not more than 5% of a Fund's net assets in
when-issued and forward commitments, illiquid securities, depositary receipts,
investment company securities and convertible securities. These investment
instruments and techniques and related risks are described in greater detail in
the Funds' Statement of Additional Information under "Investment Objectives and
Policies."
The Funds' investment objectives and policies described above may be
changed by RBB's Board of Directors without the affirmative vote of the holders
of a majority of outstanding Shares of RBB representing interests in the Funds.
Such changes may result in the Funds having investment objectives which differ
from those an investor may have considered at the time of investment. There is
no assurance that the investment objective of the Funds will be achieved.
INVESTMENT LIMITATIONS
No Fund may change the following investment limitations (with certain
exceptions, as noted below) without the affirmative vote of the holders of a
majority of a Fund's outstanding Shares. (A complete list of the investment
limitations that cannot be changed without such a vote of the shareholders is
contained in the Statement of Additional Information under "Investment
Objectives and Policies.")
The Funds may not:
1. Purchase the securities of any one issuer, other than securities
issued or guaranteed by the U.S. Government or its agencies or
instrumentalities, if immediately after and as a result of such purchase
more than 5% of the value of a Fund's total assets would be invested in the
securities of such issuer, or more than 10% of the outstanding voting
securities of such issuer would be owned by the Fund, except that up to 25%
of the value of the Fund's total assets may be invested without regard to
such limitations.
2. Borrow money, except to the extent permitted under the 1940 Act or
mortgage, pledge or hypothecate any of their respective assets in
connection with any such borrowing except in amounts not in excess of 125%
of the dollar amounts borrowed. For purposes of this Investment
Restriction, the entry into options, forward contracts, futures contracts,
including those relating to indexes, and options on futures contracts or
indexes shall not constitute borrowing.
3. Purchase any securities which would cause, at the time of purchase,
25% or more of the value of the total assets of a Fund to be invested in
the obligations of issuers in any industry, provided that there is no
limitation with respect to investments in U.S. Government obligations.
4. Make loans, except that a Fund may purchase or hold debt
obligations in accordance with its investment objective, policies and
limitations, may enter into repurchase agreements for securities, and may
lend portfolio securities against collateral consisting of cash or
securities which are consistent with the Fund's permitted investments,
which is equal at all times to at least 100% of the value of the securities
loaned. There is no investment restriction on the amount of securities that
may be loaned, except that payments received on such loans, including
amounts received during the loan on account of interest on the securities
loaned, may not (together with all non-qualifying income) exceed 10% of a
Fund's annual gross income (without offset for realized capital gains)
unless, in the opinion of counsel
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to RBB, such amounts are qualifying income under Federal income tax
provisions applicable to regulated investment companies.
In determining whether the Funds have complied with limitation 3 above, the
Funds will not take into account the value of options and futures. These
investment limitations are applied at the time investment securities are
purchased (except that, with respect to borrowings, if asset coverage falls
below 300%, a Fund will reduce its borrowing to restore asset coverage to 300%
within three business days in accordance with the requirements of the 1940 Act).
In order to permit the sale of its shares in certain states, the Funds may make
commitments more restrictive than the investment policies and limitations
described in this Prospectus. If the Funds determine that any commitment is no
longer in the best interests of the Funds, they will revoke the commitment by
terminating sale of shares of the Funds in the state involved.
MANAGEMENT
BOARD OF DIRECTORS
The business and affairs of RBB and each investment portfolio are managed
under the direction of RBB's Board of Directors.
INVESTMENT ADVISER
Numeric serves as investment adviser to the Funds. Numeric was organized in
October, 1989 as a Delaware limited partnership and is located in Cambridge,
Massachusetts. The firm, which specializes in the active management of U.S.
equity portfolios using internally developed quantitative stock selection and
portfolio risk-control techniques, currently has over $1.6 billion in assets
under management for individual, limited partnership, mutual fund, pension plan
and endowment accounts. Langdon B. Wheeler, CFA is the founder of Numeric. Mr.
Wheeler received his MBA from Harvard University and an undergraduate degree
from Yale University. All Funds are managed by John C. Bogle, Jr., CFA. Mr.
Bogle joined Numeric in 1990 after serving as Vice President and Portfolio
Manager at State Street Global Advisors. Mr. Bogle received his MBA and BS from
Vanderbilt University. Messrs. Wheeler and Bogle are active in the development
and implementation of the firm's stock selection models. The General Partner of
Numeric is Langdon Wheeler & Associates,Inc., a Massachusetts corporation. The
principal officers of Langdon Wheeler & Associates, Inc. are Messrs. Wheeler and
Bogle.
For the services provided and the expenses assumed by it, Numeric is
entitled to receive a fee from each of the Funds at an annual rate of 0.75% of a
Fund's average daily net assets, computed daily and payable monthly. Numeric may
from time to time voluntarily agree to waive all or any portion of its advisory
fees. Numeric presently intends to waive its fees to the extent necessary to
maintain an annualized expense ratio for each Fund of 1.00%, although there is
no guarantee that Numeric will maintain such waivers indefinitely.
CO-ADMINISTRATORS
Bear Stearns Funds Management Inc. ("BSFM"), an affiliate of Bear Stearns &
Co. Inc. ("Bear Stearns"), serves as co-administrator to the Funds. BSFM
generally assists each of the Funds in all aspects of their administration and
operations. The services provided and the fees payable by the Funds for these
services are described in the Statement of Additional Information under
"Investment Advisory, Distribution and Servicing Arrangements."
PFPC, an indirect wholly owned subsidiary of PNC Bank, N.A. ("PNC"), also
serves as co-administrator to the Funds. PFPC assists the Funds in matters
relating to the maintenance of financial records and accounting. The services
provided and the fees payable by the Funds for these services are described in
the Statement of Additional Information under "Investment Advisory, Distribution
and Servicing Arrangements."
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TRANSFER AGENT AND DIVIDEND DISBURSING AGENT
PFPC serves as the Funds' transfer agent and dividend disbursing agent.
PFPC's principal business address is 400 Bellevue Parkway, Wilmington, DE 19809.
The services provided and the fees payable by the Funds for these services are
described in the Statement of Additional Information under "Investment Advisory,
Distribution and Servicing Arrangements."
CUSTODIAN
Custodian Trust Company ("CTC"), an affiliate of Bear Stearns, serves as
custodian for the Funds. The services provided and the fees payable by the Funds
for these services are described in the Statement of Additional Information
under "Investment Advisory, Distribution and Servicing Arrangements."
OTHER ADMINISTRATIVE SERVICES
Counsellors Funds Service, Inc., a wholly owned subsidiary of the
Distributor, provides certain administrative services to the Funds not otherwise
provided by BSFM or PFPC. The services provided and fees payable by the Funds
for these services are described in the Statement of Additional Information
under "Investment Advisory, Distribution and Servicing Arrangements."
EXPENSES
The expenses of each Fund are deducted from their total income before
dividends are paid. These expenses include, but are not limited to, fees paid to
Numeric, fees and expenses of officers and directors who are not affiliated with
Numeric or the Funds' Distributor, taxes, interest, legal fees, custodian fees,
auditing fees, brokerage fees and commissions, certain of the fees and expenses
of registering and qualifying the Funds and their shares for distribution under
Federal and state securities laws, expenses of preparing prospectuses and
statements of additional information and of printing and distributing
prospectuses and statements of additional information annually to existing
shareholders that are not attributable to a particular class of shares of RBB,
the expense of reports to shareholders, shareholders' meetings and proxy
solicitations that are not attributable to a particular class of shares of RBB,
fidelity bond and directors and officers liability insurance premiums, the
expense of using independent pricing services and other expenses which are not
expressly assumed by the adviser under its investment advisory agreement with
respect to a Fund. Any general expenses of RBB that are not readily identifiable
as belonging to a particular investment portfolio of RBB will be allocated among
all investment portfolios of RBB based upon the relative net assets of the
investment portfolios at the time such expenses are cited. Transfer agency
expenses, expenses of preparation, printing and distributing prospectuses,
statements of additional information, proxy statements and reports to
shareholders, and registration fees, identified as belonging to a particular
class, are allocated to such class.
Numeric has agreed to reimburse each Fund for the amount, if any, by which
the total operating and management expenses of such Fund for any fiscal year
exceed the most restrictive state blue sky expense limitation in effect from
time to time, to the extent required by such limitation.
Numeric may assume additional expenses of the Funds from time to time. In
certain circumstances, Numeric may assume such expenses on the condition that it
is reimbursed by the Funds for such amounts prior to the end of a fiscal year.
In such event, the reimbursement of such amounts will have the effect of
increasing a Fund's expense ratio and of decreasing the total return or yield to
investors.
FUND TRANSACTIONS
Numeric may consider a number of factors in determining which brokers to
use in purchasing or selling a Fund's securities. These factors, which are more
fully discussed in the Statement of Additional Information, include, but are not
limited to, research services, the reasonableness of commissions and quality of
services and execution. A higher rate of turnover of a Fund's securities may
involve correspondingly higher
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transaction costs, which will be borne directly by the Fund. A Fund may
enter into brokerage transactions with and pay brokerage commissions to brokers
that are affiliated persons (as such term is defined in the 1940 Act) provided
that the terms of the brokerage transactions comply with the provisions of the
1940 Act.
Numeric may allocate trades among any or all of its clients, including the
Funds. Numeric combines orders and allocates to each account its proportionate
or "pro rata" share of the trade. Accounts included in the trade allocation may
include limited partnerships for which Numeric serves as general partner and in
which employees and/or partners of Numeric may own a substantial interest.
Numeric may cause the Funds to pay brokerage commissions which may be in excess
of the lowest rates available to brokers who execute transactions for the Funds
or who otherwise provide brokerage and research services utilized by Numeric,
provided that Numeric determines in good faith that the amount of each such
commission paid to a broker is reasonable in relation to the value of the
brokerage viewed in terms of either the particular transaction to which the
commission relates or Numeric's overall responsibilities with respect to the
Funds.
DISTRIBUTION OF SHARES
Counsellors Securities Inc. (the "Distributor"), a wholly owned subsidiary
of Warburg, Pincus Counsellors, Inc., with offices at 466 Lexington Avenue, New
York, New York, acts as distributor for each of the Funds pursuant to separate
distribution contracts (collectively, the "Distribution Contracts") with RBB on
behalf of each of the Funds.
HOW TO PURCHASE SHARES
GENERAL
Shares representing interests in the Funds are offered continuously for
sale by the Distributor and may be purchased without imposition of a sales
charge through PFPC, the Funds' transfer agent. Shares may be purchased
initially by completing the application included in this Prospectus and
forwarding the application to PFPC. Subsequent purchases of Shares may be
effected by mailing a check or Federal Reserve Draft payable to the order of
"The Numeric Family" c/o PFPC, P.0. Box 8950, Wilmington, Delaware 19899. THE
NAME OF THE FUND FOR WHICH SHARES ARE BEING PURCHASED MUST ALSO APPEAR ON THE
CHECK OR FEDERAL RESERVE DRAFT. Federal Reserve Drafts are available at national
banks or any state bank which is a member of the Federal Reserve System. Initial
investments in any Fund must be at least $3,000 and subsequent investments must
be at least $100. RBB reserves the right to reject any purchase order or to
waive the minimum initial or subsequent investment requirement. Investors will
be given notice of any increase in minimum investment requirements.
Provided that the investment is at least $2,500, an investor may also
purchase Shares by having his bank or his broker wire Federal Funds to PFPC. An
investor's bank or broker may impose a charge for this service. In order to
ensure prompt receipt of an investor's Federal Funds wire, for an initial
investment, it is important that an investor follows these steps:
A. Telephone the Funds' transfer agent, PFPC, toll-free (800) 447-1139 (in
Delaware call collect (302) 791-1031), and provide PFPC with your name, address,
telephone number, Social Security or Tax Identification Number, the Fund
selected, the amount being wired, and by which bank. PFPC will then provide an
investor with a Fund account number. (Investors with existing accounts should
also notify PFPC prior to wiring funds).
B. Instruct your bank or broker to wire the specified amount, together with
your assigned account number, to PFPC's account with PNC:
PNC Bank, N.A.
ABA-0310-0005-3.
CREDIT ACCOUNT NUMBER: 86-1030-3398
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FROM: (name of investor)
ACCOUNT NUMBER: (Investor's account number with the Fund)
FOR PURCHASE OF: (name of the Fund)
AMOUNT: (amount to be invested)
C. Fully complete and sign the Application and mail it to the address shown
thereon. PFPC will not process redemptions until it receives a fully completed
and signed Application.
For subsequent investments, an investor should follow steps A and B above.
Shares of the Funds may be purchased on any Business Day. A "Business Day"
is any day that the New York Stock Exchange (the "NYSE") is open for business.
Currently, the NYSE is closed on weekends and New Year's Day, President's Day,
Good Friday, Memorial Day, Independence Day (observed), Labor Day, Thanksgiving
Day and Christmas Day (observed). Such Shares are offered at the next determined
net asset value per share.
The price paid for a Fund's Shares purchased initially or acquired through
the exercise of an exchange privilege is based on the net asset value (less any
applicable Exchange Fee on Fund Shares held for less than two (2) years) next
computed after an order is received by PFPC. Such price will be the net asset
value next computed after an order is received by PFPC provided such order is
transmitted to and received by PFPC prior to its close of business on such day.
Orders received by PFPC after its close of business are priced at the net asset
value next determined on the following Business Day. In those cases where an
investor pays for Shares by check, the purchase will be effected at the net
asset value next determined after PFPC receives the order and Federal Funds are
available to RBB, which is generally two Business Days after a purchase order is
received.
Shareholders whose shares are held in a street name account and who desire
to transfer such shares to another street name account should contact the record
holder of their current street name account.
The Funds understand that some broker-dealers (other than the Distributor),
financial institutions, securities dealers, financial planners and other
industry professionals ("Service Agents") may impose certain conditions on their
clients that invest in the Funds, which are in addition to or different from
those described in this Prospectus, and, to the extent permitted by applicable
regulatory authority, may charge their clients direct fees. Certain features of
the Funds, such as the minimum initial or subsequent investments, may be
modified in these programs, and administrative charges may be imposed for the
services rendered. Therefore, a client or customer should contact the
organization acting on his behalf concerning the fees (if any) charged in
connection with a purchase or redemption of a Fund's shares and should read this
Prospectus in light of the terms governing his accounts with Service Agents.
Service Agents will be responsible for promptly transmitting client or customer
purchase and redemption orders to the Funds in accordance with their agreements
with clients or customers. If payment is not received by such time, the Service
Agent could be held liable for resulting fees or losses.
AUTOMATIC INVESTING
Additional investments in Shares of the Funds may be made automatically by
authorizing PFPC to withdraw funds from your bank account. Investors desiring to
participate in the automatic investing program should call RBB's transfer agent,
PFPC, at (800) 447-1139 (in Delaware call collect (302) 791-1149) to obtain the
appropriate forms, or complete the appropriate section of the Application
included with this Prospectus.
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EXCHANGE PRIVILEGE
The exchange privilege is available to shareholders residing in any state
in which the Shares being acquired may be legally sold. A shareholder may
exchange Shares of any one of the Numeric Family Funds for Shares of any other
of the Numeric Family Funds up to three (3) times per year. Such exchange will
be effected at the net asset value of the exchanged Fund and the net asset value
of the Fund to be acquired next determined after PFPC's receipt of a request for
an exchange (less an exchange fee of 1% paid to a Fund for exchanges from such
Fund of Shares held less than two (2) years). In addition, RBB reserves the
right to impose a $5.00 administrative fee for each exchange. An exchange of
Shares will be treated as a sale for Federal income tax purposes. See "Taxes."
A shareholder wishing to make an exchange may do so by sending a written
request to PFPC. Shareholders are automatically provided with telephone exchange
privileges when opening an account, unless they indicate on the Application that
they do not wish to use this privilege. To add a telephone exchange feature to
an existing account that previously did not provide for this option, a Telephone
Exchange Authorization Form must be filed with PFPC. This form is available from
PFPC. Once this election has been made, the shareholder may simply contact PFPC
by telephone to request the exchange by calling (800) 447-1139 (in Delaware call
collect (302) 791-1149). RBB will employ reasonable procedures to confirm that
instructions communicated by telephone are genuine, and if RBB does not employ
such procedures, it may be liable for any losses due to unauthorized or
fraudulent telephone instructions. Neither RBB nor PFPC will be liable for any
loss, liability, cost or expense for following RBB's telephone transaction
procedures described below or for following instructions communicated by
telephone that it reasonably believes to be genuine.
RBB's telephone transaction procedures include the following measures: (1)
requiring the appropriate telephone transaction privilege forms; (2) requiring
the caller to provide the names of the account owners, the account social
security number and name of the Fund, all of which must match RBB's records; (3)
requiring RBB's service representative to complete a telephone transaction form,
listing all of the above caller identification information; (4) permitting
exchanges only if the two account registrations are identical; (5) requiring
that redemption proceeds be sent only by check to the account owners of record
at the address of record, or by wire only to the owners of record at the bank
account of record; (6) sending a written confirmation for each telephone
transaction to the owners of record at the address of record within five (5)
business days of the call; and (7) maintaining tapes of telephone transactions
for six months, if the fund elects to record shareholder telephone transactions.
For accounts held of record by Service Agents, additional documentation or
information regarding the scope of a caller's authority is required. Finally,
for telephone transactions in accounts held jointly, additional information
regarding other account holders is required. Telephone transactions will not be
permitted in connection with IRA or other retirement plan accounts or by an
attorney-in-fact under power of attorney.
If the exchanging shareholder does not currently own Shares of the Fund
whose Shares are being acquired, a new account will be established with the same
registration, dividend and capital gain options as the account from which shares
are exchanged, unless otherwise specified in writing by the shareholder with all
signatures guaranteed by an Eligible Guarantor Institution, as defined by rules
issued by the SEC, including banks, brokers, dealers, credit unions, national
securities exchanges and savings associations. The exchange privilege may be
modified or terminated at any time, or from time to time, by RBB, upon 60 days'
written notice to shareholders.
If an exchange is to a new Numeric Family Fund, the dollar value of Shares
acquired must equal or exceed RBB's minimum for a new account; if to an existing
account, the dollar value must equal or exceed RBB's minimum for subsequent
investments. If any amount remains in the Numeric Fund from which the exchange
is being made, such amount must not drop below the minimum account value
required by RBB.
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EXCHANGE PRIVILEGE LIMITATIONS
The Funds' exchange privilege is not intended to afford
shareholders a way to speculate on short-term movements in the market.
Accordingly, in order to prevent excessive use of the exchange privilege that
may potentially disrupt the management of the Funds and increase transactions
costs, the Funds have established a policy of limiting excessive exchange
activity.
Exchange activity generally will not be deemed excessive if limited to
THREE (3) SUBSTANTIVE EXCHANGE REDEMPTIONS (AT LEAST 30 DAYS APART) from each
Fund during any twelve-month period. Notwithstanding these limitations, the
Funds reserve the right to reject any purchase request (including exchange
purchases from other Numeric Funds) that is reasonably deemed to be disruptive
to efficient portfolio management. In addition, a 1% exchange fee is paid to a
Fund for exchanges from such Fund of Shares held less than two (2) years.
RETIREMENT PLANS AND UGMA ACCOUNTS
Numeric Family Shares may be purchased in conjunction with individual
retirement accounts ("IRAs"), rollover IRAs, or pension, profit-sharing or other
employer benefit plans. Numeric Family Shares may also be purchased for accounts
established under the Uniform Gift to Minors Act or the Uniform Transfer to
Minors Act ("UGMA"). For further information as to applications and annual fees,
contact PFPC. To determine whether the benefits of an IRA or UGMA are available
and/or appropriate, a shareholder should consult with a tax adviser.
HOW TO REDEEM SHARES
NORMAL REDEMPTION
Shareholders may redeem for cash some or all of their Fund Shares at any
time. To do so, a written request in proper form must be sent directly to The
Numeric Family c/o PFPC, P.O. Box 8950, Wilmington, Delaware 19899. There is a
1% Redemption Fee paid to a Fund for redemptions of such Fund's Shares held less
than two (2) years. Shareholders may also place redemption requests through a
Service Agent, but such Service Agent might charge a fee for this service.
A request for redemption must be signed by all persons in whose names the
Shares are registered. Signatures must conform exactly to the account
registration. If the proceeds of the redemption would exceed $10,000, or if the
proceeds are not to be paid to the record owner at the record address, or if the
shareholder is a corporation, partnership, trust or fiduciary, signature(s) must
be guaranteed by an Eligible Guarantor Institution. A signature guarantee
verifies the authenticity of your signature. You may call PFPC at (800) 447-1139
(in Delaware call collect (302) 791-1149) to determine whether the entity that
will guarantee the signature is an Eligible Guarantor Institution.
Generally, a properly signed written request with any required signature
guarantee is all that is required for a redemption. In some cases, however,
other documents may be necessary. Additional documentary evidence of authority
is also required by PFPC in the event redemption is requested by a corporation,
partnership, trust, fiduciary, executor or administrator.
Investors may redeem shares without charge by telephone if they have
checked the appropriate box and supplied the necessary information on the
Application, or have filed a Telephone Authorization with PFPC. An investor may
obtain a Telephone authorization from PFPC or by calling Account Services at
(800) 447-1139 (in Delaware call collect (302) 791-1139). The Fund will employ
reasonable procedures to confirm that instructions communicated by telephone are
genuine, and if the fund does not employ such procedures, it may be liable for
any losses due to unauthorized or fraudulent telephone instructions. The
proceeds will be
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mailed by check to an investor's registered address unless he has designated in
his Application or Telephone Authorization that such proceeds are to be sent by
wire transfer to a specified checking or savings account. If proceeds are to be
sent by wire transfer, a telephone redemption request received prior to 4:00
p.m. will result in redemption proceeds being wired to the investor's bank
account on the next day that a wire transfer can be effected. The minimum
redemption for proceeds sent by wire transfer is $2,500. There is no maximum for
proceeds sent by wire transfer. The Funds may modify this redemption service at
any time or charge a service fee upon prior notice to shareholders. No service
fee is currently contemplated. RBB and PFPC reserve the right to refuse a
telephone redemption if they deem it advisable to do so. Neither the Funds,
their Administrators nor the Distributor will be liable for any loss, liability,
cost or expense for following these procedures or for following instructions
communicated by telephone that it reasonably believes to be genuine. These
procedures are set forth under "How to Purchase Shares--Exchange Privilege"
above.
The Funds are not responsible for the efficiency of the Federal Wire System
or a shareholder's investment adviser, broker-dealer or bank. The shareholder is
responsible for any charges imposed by the shareholder's bank. To change the
name of the single designated bank account to receive redemptions, it is
necessary to send a written request (with a signature guaranteed by an Eligible
Guarantor Institution) to the Numeric Family, c/o PFPC Inc., P. O. Box 8950,
Wilmington, Delaware 19899.
REDEMPTION FEE
In order to discourage short-term trading activity, a redemption fee of 1%
will be deducted from the redemption proceeds and paid to the Fund if shares
held for less than two (2) years are redeemed or exchanged. This fee helps cover
transaction costs current shareholders may bear when a Fund sells securities to
meet redemptions. These fees are paid directly to the Fund. By being paid
directly to the Fund, the fees tend to be more advantageous to long-term
investors and less advantageous to short-term investors.
INVOLUNTARY REDEMPTION
RBB reserves the right to redeem a shareholder's account in any Fund at any
time the net asset value of the account in such Fund falls below $500 as the
result of a redemption or an exchange request. Shareholders will be notified in
writing that the value of their account in a Fund is less than $500 and will be
allowed 30 days to make additional investments before the redemption is
processed.
PAYMENT OF REDEMPTION PROCEEDS
In all cases, the redemption price is the net asset value per share (less a
1% Redemption Fee paid to a Fund for redemptions of a Fund's Shares held for
less than two (2) years) next determined after the request for redemption is
received in proper form by PFPC. Payment for Shares redeemed is made by check
mailed within seven days after acceptance by PFPC of the request and any other
necessary documents in proper order. Such payment may be postponed or the right
of redemption suspended as provided by the rules of the SEC. If the Shares to be
redeemed have been recently purchased by check, PFPC may delay mailing a
redemption check, which may be a period of up to 15 days, pending a
determination that the check has cleared.
REDEMPTION IN-KIND
The Funds reserve the right, if conditions exist which make cash payments
undesirable, to honor any request for redemption of a Fund's shares by making
payment in whole or in part in securities chosen by the Fund and valued in the
same way as they would be valued for purposes of computing a Fund's net asset
value. If payment is made in securities, a shareholder may incur transaction
costs in converting these securities into cash after they have redeemed their
shares. The Funds have elected, however, to be governed by Rule 18f-1 under the
1940 Act so that a Fund is obligated to redeem its Shares solely in cash up to
the lesser of $250,000 or 1% of its net asset value during any 90-day period for
any one shareholder of a Fund.
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<PAGE>
NET ASSET VALUE
The net asset value for each Fund is calculated by adding the
value of all its securities to cash and other assets, deducting its actual and
accrued liabilities and dividing by the total number of Shares outstanding. The
net asset value of the Funds is calculated as of 4:00 p.m. Eastern Time on each
Business Day.
Valuation of securities held by the Funds is as follows: securities traded
on a national securities exchange or on the NASDAQ National Market System are
valued at the last reported sale price that day; securities traded on a national
securities exchange or on the NASDAQ National Market System for which there were
no sales on that day and securities traded on other over-the-counter markets for
which market quotations are readily available are valued at the mean of the bid
and asked prices; and securities for which market quotations are not readily
available are valued at fair market value as determined in good faith by or
under the direction of RBB's Board of Directors. The amortized cost method of
valuation may also be used with respect to debt obligations with sixty days or
less remaining to maturity.
With the approval of the Board of Directors, a Fund may use a pricing
service, bank or broker-dealer experienced in such matters to value a Fund's
securities. A more detailed discussion of net asset value and security valuation
is contained in the Statement of Additional Information.
DIVIDENDS AND DISTRIBUTIONS
The Funds will distribute substantially all of their net investment income
and net realized capital gains, if any, to each Fund's shareholders. All
distributions are reinvested in the form of additional full and fractional
Shares o f the relevant Fund unless a shareholder elects otherwise.
The Funds expect to declare and pay dividends from net investment income
annually, generally near the end of the year. Net realized capital gains
(including net short-term capital gains), if any, will be distributed at least
annually.
TAXES
The following discussion is only a brief summary of some of the important
tax considerations generally affecting the Funds and their shareholders and is
not intended as a substitute for careful tax planning. Accordingly, investors in
the Funds should consult their tax advisers with specific reference to their own
tax situation.
Each Fund will elect to be taxed as a regulated investment company under
Subchapter M of the Internal Revenue Code of 1986, as amended. So long as a Fund
qualifies for this tax treatment, such Fund will be relieved of Federal income
tax on amounts distributed to shareholders, but shareholders, unless otherwise
exempt, will pay income or capital gains taxes on amounts so distributed (except
distributions that constitute "exempt interest dividends" or that are treated as
a return of capital) regardless of whether such distributions are paid in cash
or reinvested in additional Shares.
Distributions out of the "net capital gain" (the excess of net long-term
capital gain over net short-term capital loss), if any, of any Fund will be
taxed to shareholders as long-term capital gain regardless of the length of time
a shareholder has held his Shares, whether such gain was reflected in the price
paid for the Shares, or whether such gain was attributable to bonds bearing
tax-exempt interest. All other distributions, to the extent they are taxable,
are taxed to shareholders as ordinary income. The maximum marginal rate on
ordinary income for individuals, trusts and estates is generally 31% while the
maximum rate imposed on net capital gain of such taxpayers is 28%. Corporate
taxpayers are taxed at the same rates on both ordinary income and capital gains.
18
<PAGE>
RBB will send written notices to shareholders annually regarding the tax
status of distributions made by each Fund. Dividends declared in October,
November or December of any year payable to shareholders of record on a
specified date in such a month will be deemed to have been received by the
shareholders on December 31, provided such dividends are paid during January of
the following year. Each Fund intends to make sufficient actual or deemed
distributions prior to the end of each calendar year to avoid liability for
Federal excise tax.
Investors should be careful to consider the tax implications of buying
Shares just prior to a distribution. The price of shares purchased at that time
will reflect the amount of the forthcoming distribution. Those investors
purchasing just prior to a distribution will nevertheless be taxed on the entire
amount of the distribution received.
Shareholders who exchange Shares representing interests in one Fund for
Shares representing interests in another Fund will generally recognize capital
gain or loss for Federal income tax purposes.
Shareholders who are nonresident alien individuals, foreign trusts or
estates, foreign corporations or foreign partnerships may be subject to
different U.S. Federal income tax treatment.
An investment in any one Fund is not intended to constitute a balanced
investment program. Future legislative or administrative changes or court
decisions may materially affect the tax consequences of investing in one or more
Funds of RBB. Shareholders are also urged to consult their tax advisers
concerning the application of state and local income taxes to investments in RBB
which may differ from the Federal income tax consequences described above.
DESCRIPTION OF SHARES
RBB has authorized capital of thirty billion shares of Common Stock, $.001
par value per share, of which 12.35 billion shares are currently classified into
66 different classes of Common Stock (see "Description of Shares" in the
Statement of Additional Information).
Exchanges between the Numeric Family and other Families of RBB are not
permitted.
THIS PROSPECTUS AND THE STATEMENT OF ADDITIONAL INFORMATION INCORPORATED
HEREIN RELATES PRIMARILY TO THE NUMERIC FAMILY CLASSES AND DESCRIBE
ONLY THE INVESTMENT OBJECTIVE AND POLICIES, OPERATIONS, CONTRACTS AND OTHER
MATTERS RELATING TO THE NUMERIC FAMILY CLASSES.
Each share that represents an interest in a Fund has an equal proportionate
interest in the assets belonging to such Fund with each other share that
represents an interest in such Fund, even where a share has a different class
designation than another share representing an interest in that Fund. Shares of
RBB do not have preemptive or conversion rights. When issued for payment as
described in this Prospectus, shares of RBB will be fully paid and
non-assessable.
RBB currently does not intend to hold annual meetings of shareholders
except as required by the 1940 Act or other applicable law. The law under
certain circumstances provides shareholders with the right to call for a meeting
of shareholders to consider the removal of one or more directors. To the extent
required by law, RBB will assist in shareholder communication in such matters.
Holders of shares of each of the Funds will vote in the aggregate and not
by class on all matters, except where otherwise required by law. Further,
shareholders of all investment portfolios of RBB will vote in the aggregate and
not by portfolio except as otherwise required by law or when the Board of
Directors determines that the matter to be voted upon affects only the interests
of the shareholders of a particular investment portfolio. (See the Statement of
Additional Information under "Additional Information
19
<PAGE>
Concerning Fund Shares" for examples when the 1940 Act requires voting by
investment portfolio or by class.) Shareholders of RBB are entitled to one vote
for each full share held (irrespective of class or portfolio) and fractional
votes for fractional shares held. Voting rights are not cumulative and,
accordingly, the holders of more than 50% of the aggregate shares of Common
Stock of RBB may elect all of the directors.
As of February 28, 1996, to RBB's knowledge, no person held of record or
beneficially 25% or more of the outstanding shares of all classes of RBB.
OTHER INFORMATION
REPORTS AND INQUIRIES
Shareholders will receive unaudited semi-annual reports describing the
Funds' investment operations and annual financial statements audited by
independent accountants. Shareholder inquiries should be addressed to PFPC,
Bellevue Park Corporate Center, 400 Bellevue Parkway, Wilmington, Delaware
19809, toll-free (800) 447-1139 (in Delaware call collect (302) 791-1149).
HISTORICAL PRO-FORMA PERFORMANCE INFORMATION
Presented below are the pro forma performance histories of certain managed
accounts advised by John C. Bogle, Jr, the portfolio manager for each of the
Funds, for various periods ended December 31, 1995, assuming total expenses of
1.00%.
GROWTH FUND
AVERAGE ANNUAL TOTAL RETURN
1 Year 2 years
----% -----%
MID CAP FUND
AVERAGE ANNUAL TOTAL RETURN
1 Year 3 Years 5 Years 7 years
----% -----% ----% -----%
The accounts managed by Mr. Bogle have investment objectives, policies and
strategies substantially similar to those to be employed in managing the Funds.
The historical pro-forma performance information presented above for the managed
accounts includes reinvestment of dividends received on the underlying
securities. This information is deemed relevant with respect to each Fund
because these accounts were managed using substantially the same investment
objective, policies, restrictions and methodologies as those to be used by the
relevant Fund. The periods shown are the entire periods during which these
accounts were managed in this manner. However, this performance information is
not necessarily indicative of the future performance of each Fund. Because each
Fund will be actively managed, its investments will vary from time to time and
will not be identical to the past portfolio investments of the managed accounts.
Each Fund's performance will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than their original costs.
20
<PAGE>
FUTURE PERFORMANCE INFORMATION
From time to time, the Funds may advertise their performance, including
comparisons to other mutual funds with similar investment objectives and to
stock or other relevant indices. All such advertisements will show the average
annual total return over one, five and ten year periods or, if such periods have
not yet elapsed, shorter periods corresponding to the life of such Funds. Such
total return quotations will be computed by finding the compounded average
annual total return for each time period that would equate the assumed initial
investment of $1,000 to the ending redeemable value, net of fees, according to a
required standardized calculation. The standard calculation is required by the
SEC to provide consistency and comparability in investment company advertising.
The Funds may also from time to time include in such advertising an aggregate
total return figure or a total return figure that is not calculated according to
the standardized formula in order to compare more accurately a Fund's
performance with other measures of investment return. For example, a Fund's
total return may be compared with data published by Lipper Analytical Services,
Inc., CDA Investment Technologies, Inc. or Weisenberger Investment Company
Service, or with the performance of the Standard & Poor's 500 Stock Index or the
Dow Jones Industrial Average, as well as the benchmarks described in the
Appendix to this Prospectus. Performance information may also include evaluation
of the Funds by nationally recognized ranking services and information as
reported in financial publications such as Business Week, Fortune, Institutional
Investor, Money Magazine, Forbes, Barron's, The Wall Street Journal, The New
York Times, or other national, regional or local publications. All
advertisements containing performance data will include a legend disclosing that
such performance data represents past performance and that the investment return
and principal value of an investment will fluctuate so that an investor's
Shares, when redeemed, may be worth more or less than their original cost.
From time to time, the Funds may also advertise their "30-day yield." The
yields of such Funds refer to the income generated by an investment in a Fund
over the 30-day period identified in the advertisement, and is computed by
dividing the net investment income per share earned by a Fund during the period
by the maximum public offering price per share of the last day of the period.
This income is "annualized" by assuming that the amount of income is generated
each month over a one-year period and is compounded semi-annually. The
annualized income is then shown as a percentage of the net asset value.
The yield on Shares of any of the Funds will fluctuate and is not
necessarily representative of future results. Shareholders should remember that
yield is generally a function of portfolio quality and maturity, type of
instrument, operating expenses and market conditions. Any fees charged by
broker/dealers directly to their customers in connection with investments in a
Fund are not reflected in the yields on a Fund's Shares, and such fees, if
charged, will reduce the actual return received by shareholders on their
investments.
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APPENDIX A
PERFORMANCE BENCHMARKS
================================================================================
Numeric Performance
Fund Benchmark Description
- --------------------------------------------------------------------------------
Micro Cap Wilshire Small Wilshire Asset Management's indices are derived
Company Growth from the largest 2500 securities by market
Index capitalization, the TOP 2500, of the WILSHIRE
5000 stock index. The Small Company Universe
consists of stocks 751 through 2500 (the
largest 750 stocks ranked by market
capitalization are excluded). The Small Company
Index is segmented into growth and value
categories. Variables employed to identify
growth stocks include high sales growth, high
return on equity, and low dividend payout.
- --------------------------------------------------------------------------------
Growth Russell 2500 The Russell 2500 is an index of stock 501
Growth Index through 3000 in the Russell 3000 Index, as
ranked by total market capitalization. This
index is segmented into growth and value
categories. The Russell 2500 Growth Index
contains stocks from the Russell 2500 with
greater-than-average growth orientation.
Companies in this index generally have higher
price-to-book and price/earnings ratios.
- --------------------------------------------------------------------------------
Mid Cap S&P MidCap 400 A broad-based index of 400 companies with market
Index capitalizations from $50 million to $10 billion.
The Standard & Poor's MidCap 400 Index is a
widely accepted, unmanaged index of overall
mid-cap stock market performance.
================================================================================
App. A-1
<PAGE>
194665.004(B&F)
NUMERIC MICRO CAP FUND
NUMERIC GROWTH FUND
NUMERIC MID CAP FUND
(INVESTMENT PORTFOLIOS OF THE RBB FUND, INC.)
STATEMENT OF ADDITIONAL INFORMATION
This Statement of Additional Information provides supplementary information
pertaining to shares of the classes (the "Shares") representing interests in the
Numeric Micro Cap Fund (the "Micro Cap Fund"), the Numeric Growth Fund (the
"Growth Fund") and the Numeric Mid Cap Fund (the "Mid Cap Fund") (collectively,
the "Funds") of The RBB Fund, Inc. ("RBB"). This Statement of Additional
Information is not a prospectus, and should be read only in conjunction with the
Numeric Family Prospectus dated May __, 1996 (the "Prospectus"). A copy of the
Prospectus may be obtained from Numeric by calling toll-free (800) NUMERIC
[(800) 686-3742]. This Statement of Additional Information is dated May __,
1996.
CONTENTS
Prospectus
PAGE PAGE
General.................................................. 2 1
Investment Objectives and Policies....................... 2 6
Directors and Officers................................... 11 N/A
Investment Advisory, Distribution and Servicing
Arrangements........................................... 13 11
Fund Transactions........................................ 15 13
Purchase and Redemption Information...................... 17 13
Valuation of Shares...................................... 17 18
Performance Information.................................. 18 20
Taxes.................................................... 20 18
Description of Shares.................................... 23 19
Additional Information Concerning Fund Shares............ 25 N/A
Miscellaneous............................................ 25 N/A
Financial Statements..................................... N/A N/A
Appendix A............................................... A-1 A-1
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS NOT CONTAINED IN THIS STATEMENT OF ADDITIONAL INFORMATION IN
CONNECTION WITH THE OFFERING MADE BY THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY RBB OR ITS DISTRIBUTOR. THE STATEMENT OF ADDITIONAL INFORMATION DOES NOT
CONSTITUTE AN OFFERING BY RBB OR BY THE DISTRIBUTOR IN ANY JURISDICTION IN WHICH
SUCH OFFERING MAY NOT LAWFULLY BE MADE.
<PAGE>
GENERAL
BB is an open-end management investment company currently operating or
proposing to operate seventeen separate investment portfolios. RBB is an
open-end investment company registered under the Investment Company Act of 1940
(the "1940 Act") and was organized as a Maryland corporation on February 29,
1988. This Statement of Additional Information pertains to Shares representing
interests in the Funds offered by the Prospectus dated May __, 1996.
Capitalized terms used herein and not otherwise defined have the same
meanings as are given to them in the Prospectus.
INVESTMENT OBJECTIVES AND POLICIES
The following supplements the information contained in the Prospectus
concerning the investment objectives and policies of the Funds. A description of
ratings of certain instruments the Funds may purchase is set forth in the
Appendix to this Statement of Additional Information.
FUTURES CONTRACTS. When a Fund purchases a futures contract, it agrees to
purchase a specified underlying instrument at a specified future date. When a
Fund sells a futures contract, it agrees to sell the underlying instrument at a
specified future date. The price at which the purchase and sale will take place
is fixed when a Fund enters into the contract. The underlying instrument may be
a specified type of security, such as U.S. Treasury bonds or notes.
The majority of futures contracts are closed out by entering into an
offsetting purchase or sale transaction in the same contract on the exchange
where they are traded, rather than being held for the life of the contract.
Futures contracts are closed out at their current prices, which may result in a
gain or loss.
If a Fund holds a futures contract until the delivery date, it will be
required to complete the purchase and sale contemplated by the contract. In the
case of futures contracts on securities, the purchaser generally must deliver
the agreed-upon purchase price in cash, and the seller must deliver securities
that meet the specified characteristics of the contract.
A Fund may purchase futures contracts as an alternative to purchasing
actual securities. For example, if a Fund intended to purchase bonds but had not
yet done so, it could purchase a futures contract in order to lock in current
bond prices while deciding on particular investments. This strategy is sometimes
known as an anticipatory hedge. Alternatively, a Fund could purchase a futures
contract if it had cash and short-term securities on hand that it wished to
invest in longer-term securities, but at the same time that Fund wished to
maintain a highly liquid position in order to be prepared to meet redemption
requests or other obligations. In these strategies a Fund would use futures
contracts to attempt to achieve an overall return -- whether positive or
negative -- similar to the return from longer-term securities, while taking
advantage of potentially greater liquidity that futures contracts may offer.
Although the Funds would hold cash and liquid debt securities in a segregated
account with a value sufficient to cover their open futures obligations, the
segregated assets would be available to the Funds immediately upon closing out
the futures position, while settlement of securities transactions can take
several days. However, because a Fund's cash that would otherwise have been
invested in higher-yielding bonds would be held uninvested or invested in
short-term securities so long as the futures position remains open, the Fund's
return would involve a smaller amount of interest income and potentially a
greater amount of capital gain or loss.
2
<PAGE>
The Funds may sell futures contracts to hedge their other investments
against changes in value, or as an alternative to sales of securities. For
example, if the investment adviser anticipated a decline in bond prices, but did
not wish to sell bonds owned by a Fund, it could sell a futures contract in
order to lock in a current sale price. If prices subsequently fell, the future
contract's value would be expected to rise and offset all or a portion of the
loss in the bonds that the Fund had hedged. Of course, if prices subsequently
rose, the futures contract's value could be expected to fall and offset all or a
portion of the benefit of the Fund. In this type of strategy, a Fund's return
will tend to involve a larger component of interest income, because the Fund
will remain invested in longer-term securities rather than selling them and
investing the proceeds in short-term securities which generally provide lower
yields.
FUTURES MARGIN PAYMENTS. The purchaser or seller of a futures contract is
not required to deliver or pay for the underlying instrument unless the contract
is held until the delivery date. However, both the purchaser and seller are
required to deposit "initial margin" with a futures broker (known as a futures
commission merchant, or FCM), when the contract is entered into. Initial margin
deposits are equal to a percentage of the contract's value, as set by the
exchange where the contract is traded, and may be maintained in cash or high
quality liquid securities. If the value of either party's position declines,
that party will be required to make additional "variation margin" payments to
settle the change in value on a daily basis. The party that has a gain may be
entitled to receive all or a portion of this amount. Initial and variation
margin payments are similar to good faith deposits or performance bonds, unlike
margin extended by a securities broker, and initial and variation margin
payments do not constitute purchasing securities on margin for purposes of a
Fund's investment limitations. In the event of the bankruptcy of an FCM that
holds margin on behalf of a Fund, that Fund may be entitled to a return of
margin owed to it only in proportion to the amount received by the FCM's other
customers. The investment adviser will attempt to minimize this risk by careful
monitoring of the creditworthiness of the FCMs with which a Fund does business.
CORRELATION OF PRICE CHANGES. The prices of futures contracts depend
primarily on the value of their underlying instruments. Because there are a
limited number of types of futures contracts, it is likely that the standardized
futures contracts available to a Fund will not match that Fund's current or
anticipated investments. Futures prices can also diverge from the prices of
their underlying instruments, even if the underlying instruments match a Fund's
investments well. Futures prices are affected by such factors as current and
anticipated short-term interest rates, changes in volatility of the underlying
instrument, and the time remaining until expiration of the contract, which may
not affect security prices the same way. Imperfect correlation between a Fund's
investments and its futures positions may also result from differing levels of
demand in the futures markets and the securities markets, from structural
differences in how futures and securities are traded, or from imposition of
daily price fluctuation limits for futures contracts. The Funds may purchase or
sell futures contracts with a greater or lesser value than the securities they
wish to hedge or intend to purchase in order to attempt to compensate for
differences in historical volatility between the futures contract and the
securities, although this may not be successful in all cases. If price changes
in a Fund's futures positions are poorly correlated with its other investments,
its futures positions may fail to produce anticipated gains or result in losses
that are not offset by the gains in the Fund's other investments.
LIQUIDITY OF FUTURES CONTRACTS. Because futures contracts are generally
settled within a day from the date they are closed out, compared with a
settlement period of seven days for some types of securities, the futures
markets can provide liquidity superior to the securities markets in many cases.
Nevertheless, there is no assurance a liquid secondary market will exist for any
particular futures contract at any particular time. In addition, futures
exchanges may establish daily price fluctuation limits for futures contracts,
and may halt trading if a contract's price moves upward or downward more than
the limit in a given day. On volatile trading days when the price fluctuation
limit is reached, it may be impossible for a Fund to enter into new positions or
close out existing positions. If the secondary market for a futures contract is
not liquid because of price fluctuation limits or otherwise, it would prevent
prompt liquidation of unfavorable futures positions, and
3
<PAGE>
potentially could require a Fund to continue to hold a futures position until
the delivery date regardless of changes in its value. As a result, a Fund's
access to other assets held to cover its futures positions could also be
impaired.
PURCHASING PUT OPTIONS. By purchasing a put option, a Fund obtains the
right (but not the obligation) to sell the option's underlying instrument at a
fixed strike price. The option may give a Fund the right to sell only on the
option's expiration date, or may be exercisable at any time up to and including
that date. In return for this right, a Fund pays the current market price for
the option (known as the option premium). The option's underlying instrument may
be a security, or a futures contract.
A Fund may terminate its position in a put option it has purchased by
allowing it to expire or by exercising the option. If the option is allowed to
expire, the Fund will lose the entire premium it paid. If the Fund exercises the
option, it completes the sale of the underlying instrument at the strike price.
If a Fund exercises a put option on a futures contract, it assumes a seller's
position in the underlying futures contract. Purchasing an option on a futures
contract does not require a Fund to make futures margin payments unless it
exercises the option. A Fund may also terminate a put option position by closing
it out in the secondary market at its current price, if a liquid secondary
market exists.
Put options may be used by a Fund to hedge securities it owns, in a manner
similar to selling futures contracts, by locking in a minimum price at which the
Fund can sell. If security prices fall, the value of the put option would be
expected to rise and offset all or a portion of the Fund's resulting losses. The
put thus acts as a hedge against a fall in the price of such securities.
However, all other things being equal (including securities prices) option
premiums tend to decrease over time as the expiration date nears. Therefore,
because of the cost of the option in the form of the premium (and transaction
costs), a Fund would expect to suffer a loss in the put option if prices do not
decline sufficiently to offset the deterioration in the value of the option
premium. This potential loss represents the cost of the hedge against a fall in
prices. At the same time, because the maximum a Fund has at risk is the cost of
the option, purchasing put options does not eliminate the potential for a Fund
to profit from an increase in the value of the securities hedged to the same
extent as selling a futures contract.
PURCHASING CALL OPTIONS. The features of call options are essentially the
same as those of put options, except that the purchaser of a call option obtains
the right to purchase, rather than sell, the underlying instrument at the
option's strike price (call options on futures contracts are settled by
purchasing the underlying futures contract). By purchasing a call option, a Fund
would attempt to participate in potential price increases of the underlying
instrument, with results similar to those obtainable from purchasing a futures
contract, but with risk limited to the cost of the option if security prices
fell. At the same time, a Fund can expect to suffer a loss if security prices do
not rise sufficiently to offset the cost of the option.
The Funds will purchase call options only in connection with "closing
purchase transactions." A Fund may terminate its position in a call option by
entering into a closing purchase transaction. A closing purchase transaction is
the purchase of a call option on the same security with the same exercise price
and call period as the option previously written by a Fund. If a Fund is unable
to enter into a closing purchase transaction, the Fund may be required to hold a
security that it might otherwise have sold to protect against depreciation.
WRITING PUT OPTIONS. When a Fund writes a put option, it takes the opposite
side of the transaction from the option's purchaser. In return for receipt of
the premium, a Fund assumes the obligation to pay the strike price for the
option's underlying instrument if the other party to the option chooses to
exercise it. When writing an option on a futures contract a Fund will be
required to make margin payments to an FCM as described above for futures
contracts. A Fund may seek to terminate its position in a put option it writes
before
4
<PAGE>
exercise by closing out the option in the secondary market at its current
price. If the secondary market is not liquid for an option a Fund has written,
however, the Fund must continue to be prepared to pay the strike price while the
option is outstanding, regardless of price changes, and must continue to set
aside assets to cover its position.
A Fund may write put options as an alternative to purchasing actual
securities. If security prices rise, the Fund would expect to profit from a
written put option, although its gain would be limited to the amount of the
premium it received. If security prices remain the same over time, it is likely
that the Fund will also profit, because it should be able to close out the
option at a lower price. If security prices fall, the Fund would expect to
suffer a loss. This loss should be less than the loss the Fund would have
experienced from purchasing the underlying instrument directly, however, because
the premium received for writing the option should mitigate the effects of the
decline. As with other futures and options strategies used as alternatives for
purchasing securities, a Fund's return from writing put options generally will
involve a smaller amount of interest income than purchasing longer-term
securities directly, because a Fund's cash will be invested in shorter-term
securities which usually offer lower yields.
WRITING CALL OPTIONS. Writing a call option obligates a Fund to sell or
deliver the option's underlying instrument, in return for the strike price, upon
exercise of the option. The characteristics of writing call options are similar
to those of writing put options, as described above, except that writing covered
call options generally is a profitable strategy if prices remain the same or
fall. Through receipt of the option premium, a Fund would seek to mitigate the
effects of a price decline. At the same time, because a Fund would have to be
prepared to deliver the underlying instrument in return for the strike price,
even if its current value is greater, the Fund would give up some ability to
participate in security price increases when writing call options.
COMBINED OPTION POSITIONS. A Fund may purchase and write options in
combination with each other to adjust the risk and return characteristics of the
overall position. For example, a Fund may purchase a put option and write a call
option on the same underlying instrument, in order to construct a combined
position whose risk and return characteristics are similar to selling a futures
contract. Another possible combined position would involve writing a call option
at one strike price and buying a call option at a lower price, in order to
reduce the risk of the written call option in the event of a substantial price
increase. Because combined options positions involve multiple trades, they
result in higher transaction costs and may be more difficult to open and close
out.
RISKS OF OPTIONS TRANSACTIONS. Options are subject to risks similar to
those described above with respect to futures contracts, including the risk of
imperfect correlation between the option and a Fund's other investments and the
risk that there might not be a liquid secondary market for the option. In the
case of options on futures contracts, there is also a risk of imperfect
correlation between the option and the underlying futures contract. Options are
also subject to the risks of an illiquid secondary market, particularly in
strategies involving writing options, which a Fund cannot terminate by exercise.
In general, options whose strike prices are close to their underlying
instruments' current value will have the highest trading volume, while options
whose strike prices are further away may be less liquid. The liquidity of
options may also be affected if options exchanges impose trading halts,
particularly when markets are volatile.
ASSET COVERAGE FOR FUTURES AND OPTIONS POSITIONS. A Fund will not use
leverage in its options and futures strategies. A Fund will hold securities or
other options or futures positions whose values are expected to offset its
obligations under the hedge strategies. A Fund will not enter into an option or
futures position that exposes the Fund to an obligation to another party unless
it owns either (i) an offsetting position in securities or other options or
futures contracts or (ii) cash, receivables and short-term debt securities with
a value sufficient to cover its potential obligations. A Fund will comply with
guidelines established by the SEC
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with respect to coverage of options and futures strategies by mutual funds,
and if the guidelines so require will set aside cash and high grade liquid debt
securities in a segregated account with its custodian bank in the amount
prescribed. Securities held in a segregated account cannot be sold while the
futures or option strategy is outstanding, unless they are replaced with similar
securities. As a result, there is a possibility that segregation of a large
percentage of a Fund's assets could impede portfolio management or the Fund's
ability to meet redemption requests or other current obligations.
LIMITATIONS ON FUTURES AND OPTIONS TRANSACTIONS. RBB, on behalf of the
Funds, has filed a notice of eligibility for exclusion from the definition of
the term "commodity pool operator" with the Commodity Futures Trading Commission
("CFTC") and the National Futures Association, which regulate trading in the
futures markets. Pursuant to Section 4.5 of the regulations under the Commodity
Exchange Act, the Funds will not enter into any commodity futures contract or
option on a commodity futures contract for non-hedging purposes if, as a result,
the sum of initial margin deposits on commodity futures contracts and related
commodity options and premiums paid for options on commodity futures contracts
the Funds have purchased would exceed 5% of a Fund's total assets after taking
into account unrealized profits and losses on such contracts.
The Funds' limitations on investments in futures contracts and their
policies regarding futures contracts and the limitations on investments in
options and its policies regarding options discussed above in this Statement of
Additional Information, are not fundamental policies and may be changed as
regulatory agencies permit. The Funds will not modify the above limitations to
increase its permissible futures and options activities without supplying
additional information in a current Prospectus or Statement of Additional
Information that has been distributed or made available to the Funds'
shareholders.
SHORT SALES "AGAINST THE BOX." In a short sale, a Fund sells a borrowed
security and has a corresponding obligation to the lender to return the
identical security. A Fund may engage in short sales if at the time of the short
sale it owns or has the right to obtain, at no additional cost, an equal amount
of the security being sold short. This investment technique is known as a short
sale "against the box." In a short sale, a seller does not immediately deliver
the securities sold and is said to have a short position in those securities
until delivery occurs. If a Fund engages in a short sale, the collateral for the
short position will be maintained by the Fund's custodian or a qualified
sub-custodian. While the short sale is open, the Fund will maintain in a
segregated account an amount of securities equal in kind and amount to the
securities sold short or securities convertible into or exchangeable for such
equivalent securities. These securities constitute a Fund's long position. The
Funds will not engage in short sales against the box for speculative purposes. A
Fund may, however, make a short sale as a hedge, when it believes that the price
of a security may decline, causing a decline in the value of a security owned by
the Fund (or a security convertible or exchangeable for such security), or when
the Fund wants to sell the security at an attractive current price, but also
wishes to defer recognition of gain or loss for federal income tax purposes and
for purposes of satisfying certain tests applicable to regulated investment
companies under the Internal Revenue Code. In such case, any future losses in a
Fund's long position should be reduced by a gain in the short position.
Conversely, any gain in the long position should be reduced by a loss in the
short position. The extent to which such gains or losses are reduced will depend
upon the amount of the security sold short relative to the amount a Fund owns.
There will be certain additional transaction costs associated with short sales
against the box, but the Funds will endeavor to offset these costs with the
income from the investment of the cash proceeds of short sales.
SECTION 4(2) PAPER. "Section 4(2) paper" is commercial paper which is
issued in reliance on the "private placement" exemption from registration which
is afforded by Section 4(2) of the Securities Act of 1933. Section 4(2) paper is
restricted as to disposition under the Federal securities laws and is generally
sold to institutional investors such as the Funds which agree that they are
purchasing the paper for investment and not with a view to public distribution.
Any resale by the purchaser must be in an exempt transaction. Section 4(2)
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paper normally is resold to other institutional investors through or with
the assistance of investment dealers who make a market in the Section 4(2)
paper, thereby providing liquidity. See "Illiquid Securities" below.
RIGHTS OFFERINGS AND PURCHASE WARRANTS. Rights offerings and purchase
warrants are privileges issued by a corporation which enable the owner to
subscribe to and purchase a specified number of shares of the corporation at a
specified price during a specified period of time. Subscription rights normally
have a short lifespan to expiration. The purchase of rights or warrants involves
the risk that a Fund could lose the purchase value of a right or warrant if the
right to subscribe to additional shares is not executed prior to the rights and
warrants expiration. Also, the purchase of rights and/or warrants involves the
risk that the effective price paid for the right and/or warrant added to the
subscription price of the related security may exceed the value of the
subscribed security's market price such as when there is no movement in the
level of the underlying security.
ILLIQUID SECURITIES. A Fund may not invest more than 15% of its net assets
in illiquid securities, including repurchase agreements which have a maturity of
longer than seven days and securities that are illiquid by virtue of the absence
of a readily available market or legal or contractual restrictions on resale.
Securities that have legal or contractual restrictions on resale but have a
readily available market are not considered illiquid for purposes of this
limitation. The Funds' investment adviser will monitor the liquidity of such
restricted securities under the supervision of the Board of Directors.
Repurchase agreements subject to demand are deemed to have a maturity equal to
the notice period.
Historically, illiquid securities have included securities subject to
contractual or legal restrictions on resale because they have not been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
securities which are otherwise not readily marketable and repurchase agreements
having a maturity of longer than seven days. Securities which have not been
registered under the Securities Act are referred to as private placements or
restricted securities and are purchased directly from the issuer or in the
secondary market. The Board has adopted a policy that the Funds will not
purchase private placements (i.e. restricted securities other than Rule 144A
Securities). Mutual funds do not typically hold a significant amount of these
restricted or other illiquid securities because of the potential for delays on
resale and uncertainty in valuation. Limitations on resale may have an adverse
effect on the marketability of portfolio securities and a mutual fund might be
unable to dispose of restricted or other illiquid securities promptly or at
reasonable prices and might thereby experience difficulty satisfying redemptions
within seven days. A mutual fund might also have to register such restricted
securities in order to dispose of them resulting in additional expense and
delay. Adverse market conditions could impede such a public offering of
securities.
In recent years, however, a large institutional market has developed for
certain securities that are not registered under the Securities Act including
repurchase agreements, commercial paper, foreign securities, municipal
securities and corporate bonds and notes. Institutional investors depend on an
efficient institutional market in which the unregistered security can be readily
resold or on an issuer's ability to honor a demand for repayment. The fact that
there are contractual or legal restrictions on resale to the general public or
to certain institutions may not be indicative of the liquidity of such
investments.
The SEC adopted Rule 144A which allows for a broader institutional trading
market for securities otherwise subject to restriction on resale to the general
public. Rule 144A establishes a "safe harbor" from the registration requirements
of the Securities Act for resales of certain securities to qualified
institutional buyers. The investment adviser anticipates that the market for
certain restricted securities such as institutional commercial paper will expand
further as a result of this relatively new regulation and the development of
automated systems for the trading, clearance and settlement of unregistered
securities of domestic and foreign issuers, such as the PORTAL System sponsored
by the NASD.
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The Adviser will monitor the liquidity of restricted securities in the
Funds under the supervision of the Board of Directors. In reaching liquidity
decisions, the Adviser may consider, INTER ALIA, the following factors: (1) the
unregistered nature of the security; (2) the frequency of trades and quotes for
the security; (3) the number of dealers wishing to purchase or sell the security
and the number of other potential purchasers; (4) dealer undertakings to make a
market in the security and (5) the nature of the security and the nature of the
marketplace trades (e.g., the time needed to dispose of the security, the method
of soliciting offers and the mechanics of the transfer).
DEPOSITARY RECEIPTS. The Funds' assets may be invested in the securities of
foreign issues in the form of American Depositary Receipts ("ADRs"), European
Depositary Receipts ("EDRs") or Global Depositary Receipts ("GDRs"). These
securities may not necessarily be denominated in the same currency as the
securities into which they may be converted. ADRs and EDRs are receipts
typically issued by a United States or European bank or trust company which
evidence ownership of underlying securities issued by a foreign corporation.
GDRs are depositary receipts structured like global debt issues to facilitate
international trading. The Funds may invest in ADRs. EDRs and GDRs through
"sponsored" or "unsponsored" facilities. A sponsored facility is established
jointly by the issuer of the underlying security and a depositary, whereas a
depositary may establish an unsponsored facility without participating by the
issuer of the deposited security. Holders of unsponsored depositary receipts
generally bear all the costs of such facilities and the depositary of an
unsponsored facility frequently is under no obligation to distribute shareholder
communications received from the issuer of the deposited security or to pass
through voting rights to the holders of such receipts in respect of the
deposited securities.
INVESTMENT COMPANY SECURITIES. The Funds may invest in securities issued by
other investment companies. Under the 1940 Act, the Funds' investments in such
securities currently are limited to, subject to certain exceptions, (i) 3% of
the total voting stock of any one investment company, (ii) 5% of a Fund's net
assets with respect to any one investment company and (iii) 10% of a Fund's net
assets in the aggregate. Investments in the securities of other investment
companies will involve duplication of advisory fees and certain other expenses.
The Funds presently intend to invest in other investment companies only as
investment vehicles for short-term cash.
CONVERTIBLE SECURITIES. The Funds may invest in convertible securities,
such as convertible debentures, bonds and preferred stock, primarily for their
equity characteristics. Convertible securities may be converted into common
stock at a specified share price or ratio. Because the price of the common stock
may fluctuate above or below the specified price or ratio, a Fund may have the
opportunity to purchase the common stock at below market price. On the other
hand, fluctuations in the price of the common stock could render the right of
conversion worthless.
REPURCHASE AGREEMENTS. The repurchase price under the repurchase agreements
described in the Prospectus generally equals the price paid by the Fund involved
plus interest negotiated on the basis of current short-term rates (which may be
more or less than the rate on the securities underlying the repurchase
agreement). Securities subject to repurchase agreements will be held by RBB's
custodian in the Federal Reserve/Treasury book-entry system or by another
authorized securities depository. Repurchase agreements are considered to be
loans by the Fund involved under the 1940 Act.
REVERSE REPURCHASE AGREEMENTS. Reverse repurchase agreements involve the
sale of securities held by a Fund pursuant to the Fund's agreement to repurchase
the securities at an agreed upon price, date and rate of interest. Such
agreements are considered to be borrowings under the Investment Company Act of
1940, as amended (the "1940 Act"), and may be entered into only for temporary or
emergency purposes. While reverse repurchase transactions are outstanding, a
Fund will maintain in a segregated account with its custodian or a qualified
sub-custodian, cash, U.S. Government securities or other liquid, high-grade debt
8
<PAGE>
securities of an amount at least equal to the market value of the
securities, plus accrued interest, subject to the agreement and will monitor the
account to ensure that such value is maintained. Reverse repurchase agreements
involve the risk that the market value of the securities sold by a Fund may
decline below the price of the securities the Fund is obligated to Repurchase.
U.S. GOVERNMENT OBLIGATIONS. Examples of types of U.S. Government
obligations include U.S. Treasury Bills, Treasury Notes and Treasury Bonds and
the obligations of Federal Home Loan Banks, Federal Farm Credit Banks, Federal
Land Banks, the Federal Housing Administration, Farmers Home Administration,
Export-Import Bank of the United States, Small Business Administration, Federal
National Mortgage Association, Government National Mortgage Association, General
Services Administration, Student Loan Marketing Association, Central Bank for
Cooperatives, Federal Home Loan Mortgage Corporation, Federal Intermediate
Credit Banks, Maritime Administration, International Bank for Reconstruction and
Development (the "World Bank"), the Asian-American Development Bank and the
Inter-American Development Bank.
WHEN-ISSUED SECURITIES AND FORWARD COMMITMENTS. Each Fund may purchase
securities on a "when-issued" basis and may purchase or sell securities on a
"forward commitment" basis. These transactions involve a commitment by a Fund to
purchase or sell particular securities with payment and delivery taking place at
a future date (perhaps one or two months later), and permit a Fund to lock-in a
price or yield on a security it owns or intends to purchase, regardless of
future changes in interest rates. When-issued and forward commitment
transactions involve the risk, however, that the price or yield obtained in a
transaction may be less favorable that the price or yield available in the
market when the securities delivery takes place. A Fund's when-issued purchases
and forward commitments are not expected to exceed 25% of the value of its total
assets absent unusual market conditions. Each Fund does not intend to engage in
when-issued purchases and forward commitments for speculative purposes but only
in furtherance of their investment objectives.
INVESTMENT LIMITATIONS
The Funds have adopted the following fundamental investment limitations
which may not be changed without the affirmative vote of the holders of a
majority of the Funds' outstanding shares (as defined in Section 2(a)(42) of the
Investment Company Act). The Funds may not:
1. Purchase securities of any one issuer, other than securities issued or
guaranteed by the U.S. Government or its agencies or instrumentalities, if
immediately after and as a result of such purchase more than 5% of a Fund's
total assets would be invested in the securities of such issuer, or more than
10% of the outstanding voting securities of such issuer would be owned by a
Fund, except that up to 25% of the value of a Fund's assets may be invested
without regard to such limitation.
2. Borrow money, except to the extent permitted under the 1940 Act or
mortgage, pledge or hypothecate any of their respective assets in connection
with any such borrowing except in amounts not in excess of 125% of the dollar
amounts borrowed. The 1940 Act permits an investment company to borrow in an
amount up to 33 % of the value of such company's total assets. For purposes of
this Investment Restriction, the entry into options, forward contracts, futures
contracts, including those relating to indexes, and options on futures contracts
or indexes shall not constitute borrowing.
3. Purchase any securities which would cause, at the time of purchase, 25%
or more of the value of the total assets of a Fund to be invested in the
obligations of issuers in any industry, provided that there is no limitation
with respect to investments in U.S. Government obligations.
9
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4. Make loans, except that a Fund may purchase or hold debt obligations in
accordance with its investment objective, policies and limitations, may enter
into repurchase agreements for securities, and may lend portfolio securities
against collateral consisting of cash or securities which are consistent with
the Fund's permitted investments, which is equal at all times to at least 100%
of the value of the securities loaned. There is no investment restriction on the
amount of securities that may be loaned, except that payments received on such
loans, including amounts received during the loan on account of interest on the
securities loaned, may not (together with all non-qualifying income) exceed 10%
of a Fund's annual gross income (without offset for realized capital gains)
unless, in the opinion of counsel to RBB, such amounts are qualifying income
under Federal income tax provisions applicable to regulated investment
companies.
5. Purchase securities on margin, except for short-term credit necessary
for clearance of portfolio transactions, and except that the Fund may establish
margin accounts in connection with its use of options, forward contracts,
futures contracts, including those relating to indexes, and options on futures
contracts or indexes.
6. Underwrite securities of other issuers, except to the extent that, in
connection with the disposition of portfolio securities, a Fund may be deemed an
underwriter under Federal securities laws.
7. Purchase or sell real estate or real estate limited partnership
interests, provided that a Fund may invest in securities secured by real estate
or interests therein or issued by companies which invest in real estate or
interests therein or in real estate investment trusts.
8. Purchase or sell commodities or commodity contracts, except that a Fund
may purchase and sell options, forward contracts, futures contracts, including
those relating to indexes, and options on futures contracts or indexes.
9. Invest in oil, gas or mineral-related exploration or development
programs or leases.
10. Purchase any securities issued by any other investment company, except
to the extent permitted by the 1940 Act and except in connection with the
merger, consolidation or acquisition of all the securities or assets of such an
issuer.
11. Make investments for the purpose of exercising control or management,
but each Fund will vote those securities it owns in its portfolio as a
shareholder in accordance with its views.
12. Issue any senior security, as defined in section 18(f) of the 1940 Act,
except to the extent permitted by the 1940 Act.
13. Pledge, mortgage or hypothecate its assets, except to the extent
necessary to secure permitted borrowings as described in Limitation 1 above and
to the extent related to the purchase of securities on a when-issued or forward
commitment basis and the deposit of assets in escrow in connection with writing
covered put and call options and collateral and initial or variation margin
arrangements with respect to options, forward contracts, futures contracts,
including those relating to indexes, and options on futures contracts or
indexes.
If a percentage restriction is adhered to at the time of investment, a
later change in percentage resulting from a change in values or assets will not
constitute a violation of such restriction (except that, with respect to
borrowings, if asset coverage falls below 300%, a Fund will reduce its
borrowings to restore asset coverage to 300% within three business days, in
accordance with the requirements of the 1940 Act).
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The Funds may make commitments more restrictive than the restrictions
listed above so as to permit the sale of Fund Shares in certain states. Should
the Funds determine that a commitment is no longer in the best interest of the
Funds and their shareholders, the Funds reserve the right to revoke the
commitment by terminating the sale of Fund Shares in the state involved.
DIRECTORS AND OFFICERS
The directors and executive officers of RBB, their business addresses, ages
and principal occupations during the past five years are:
Principal Occupation
NAME AND ADDRESS POSITION WITH RBB DURING PAST FIVE YEARS
Arnold M. Reichman* Director Since 1984, Managing Director and
466 Lexington Avenue Assistant Secretary, E. M. Warburg,
New York, NY 10017 Pincus & Co., Inc.; Since 1984
Age: 47 Managing Director, Warburg Pincus
Counsellors, Inc.; Since 1985, Vice
President and Secretary, Counsellors
Securities Inc; Officer of various
investment companies advised by
Warburg, Pincus Counsellors, Inc.
Robert Sablowsky** Director Since 1985, Executive Vice President
14 Wall Street of Gruntal & Co., Inc., Director,
New York, NY 10005 Gruntal & Co., Inc. and Gruntal
Age: 57 Financial Corp.
Francis J. McKay Director Since 1963, Executive Vice
7701 Burholme Avenue President, Fox Chase Cancer Center
Philadelphia, PA 19111 (Biomedical research and
Age: 60 medical care.)
Marvin E. Sternberg Director Since 1974, Chairman, Director and
937 Mt. Pleasant Road President, Moyco Industries, Inc.
Bryn Mawr, PA 19010 (manufacturer of dental supplies and
Age: 61 precision coated abrasives); Since
1968, Director and President,
Mart MMM, Inc. (formerly
Montgomeryville Merchandise
Mart Inc.) and Mart PMM, Inc.
(formerly Pennsauken Merchandise
Mart, Inc.) (Shopping Centers); and
Since 1975, Director and Executive
Vice President, Cellucap Mfg. Co.,
Inc. (manufacturer of disposable
headwear).
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Principal Occupation
NAME AND ADDRESS POSITION WITH RBB DURING PAST FIVE YEARS
Julian A. Brodsky Director Director, and Vice Chairman, Comcast
1234 Market Street Corporation; Director, Comcast
16th Floor Cablevision of Philadelphia (cable
Philadelphia, PA 19107-3723 television and communications) and
Age: 62 Nextel (wireless communications).
Donald van Roden Director Self-employed businessman.
1200 Old Mill Lane From February 1980 to March 1987,
Wyomissing, PA 19610 Vice Chairman, SmithKline Beckman
Age: 71 Corporation (pharmaceuticals);
Director, AAA Mid-Atlantic (auto
service); Director, Keystone
Insurance Co.
Edward J. Roach President and Certified Public Accountant;
Bellevue Park Treasurer Vice Chairman of the Board, Fox
Corporate Center Chase Cancer Center; Vice President
400 Bellevue Parkway and Trustee, Pennsylvania Schoole
Wilmington, DE 19809 for the Deaf; Trustee, Immaculata
Age: 71 College; Vice President and
Treasurer of various investment
companies advised by PNC
Institutional Management
Corporation.
Morgan R. Jones Secretary Chairman of the law firm of Drinker
1100 PNB BankBuilding Biddle & Reath, Philadelphia,
Broad and Chestnut Streets Pennsylvania; Director, Rocking
Philadelphia, PA 19107 Horse Child Care Centers of
Age: 56 America, Inc.
- -----------------
* Mr. Reichman is an "interested person" of RBB as that term is defined in
the 1940 Act by virtue of his position with Counsellors Securities Inc.,
RBB's distributor.
** Mr. Sablowsky is an "interested person" of RBB as that term is
defined in the 1940 Act by virtue of his position with Gruntal & Co., Inc.,
a broker-dealer which sells RBB's shares.
Messrs. McKay, Sternberg and Brodsky are members of the Audit Committee of
the Board of Directors. The Audit Committee, among other things, reviews results
of the annual audit and recommends to RBB the firm to be selected as independent
auditors.
Messrs. Reichman, McKay and van Roden are members of the Executive
Committee of the Board of Directors. The Executive Committee may generally carry
on and manage the business of RBB when the Board of Directors is not in session.
Messrs. McKay, Sternberg, Brodsky and van Roden are members of the
Nominating Committee of the Board of Directors. The Nominating Committee
recommends to the Board annually all persons to be nominated as directors of
RBB.
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RBB pays directors who are not "affiliated persons" (as that term is
defined in the 1940 Act) of RBB $9,500 annually and $700 per meeting of the
Board or any committee thereof that is not held in conjunction with a Board
meeting. Directors who are not affiliated persons of RBB are reimbursed for any
expenses incurred in attending meetings of the Board of Directors or any
committee thereof. The Chairman (currently Donald van Roden) receives an
additional $5,000 for his services. For the year ended August 31, 1995, each of
the following members of the Board of Directors received compensation from the
Fund in the following amounts: Julian A. Brodsky in the aggregate amount of
$9,425; Francis J. McKay in the aggregate amount of $12,025; Marvin E. Sternberg
in the aggregate amount of $12,675; Donald van Roden in the aggregate amount of
$14,675. On October 24, 1990, RBB adopted, as a participating employer, RBB
Office Retirement Profit-Sharing Plan and Trust Agreement, a retirement plan for
employees (currently Edward J. Roach) pursuant to which RBB will contribute on a
monthly basis amounts equal to 10% of the monthly compensation of each eligible
employee. By virtue of the services performed by RBB's investment advisers,
administrators and the Distributor, RBB itself requires only one part-time
employee. No officer, partner or employee of Numeric currently receives any
compensation from RBB.
INVESTMENT ADVISORY, DISTRIBUTION AND SERVICING ARRANGEMENTS
ADVISORY AGREEMENTS
Numeric renders advisory services to the Funds pursuant to Investment
Advisory Contracts. The Advisory Contracts relating to each of the Funds are
dated April 24, 1996. Under the Advisory Contracts, Numeric is entitled to
receive a fee from each Fund calculated at an annual rate of 0.75% of a Fund's
average daily net assets. For the fiscal year ended August 31, 1996, Numeric
intends to waive its fees to the extent necessary to maintain an annualized
expense ratio for each Fund of 1.00%. There can be no assurance that Numeric
will continue such waivers indefinitely.
As required by various state regulations, Numeric will reimburse RBB or the
Funds affected (as applicable) if and to the extent that the aggregate operating
expenses of RBB or the Funds affected exceed applicable state limits for the
fiscal year, to the extent required by such state regulations. Currently, the
most restrictive of such applicable limits is believed to be 2 1/2% of the first
$30 million of average annual net assets, 2% of the next $70 million of average
annual net assets and 1 1/2% of the remaining average annual net assets. Certain
expenses, such as brokerage commissions, taxes, interest and extraordinary
items, are excluded from this limitation. Whether such expense limitations apply
to RBB as a whole or to the Funds on an individual basis depends upon the
particular regulations of such states.
The Funds bear all of their own expenses not specifically assumed by
Numeric. General expenses of RBB not readily identifiable as belonging to a
portfolio of RBB are allocated among all investment portfolios by or under the
direction of RBB's Board of Directors in such manner as the Board determines to
be fair and equitable. Expenses borne by a Fund include, but are not limited to,
the following (or a Fund's share of the following): (a) the cost (including
brokerage commissions) of securities purchased or sold by a Fund and any losses
incurred in connection therewith; (b) fees payable to and expenses incurred on
behalf of a Fund by Numeric; (c) expenses of organizing RBB that are not
attributable to a class of RBB; (d) certain of the filing fees and expenses
relating to the registration and qualification of RBB and a Fund's shares under
Federal and/or state securities laws and maintaining such registrations and
qualifications; (e) fees and salaries payable to RBB's directors and officers;
(f) taxes (including any income or franchise taxes) and governmental fees; (g)
costs of any liability and other insurance or fidelity bonds; (h) any costs,
expenses or losses arising out of a liability of or claim for damages or other
relief asserted against RBB or a Fund for violation of any law; (i) legal,
accounting and auditing expenses, including legal fees of special counsel for
the independent directors; (j) charges of custodians and other agents; (k)
expenses of setting in type and printing prospectuses, statements of
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additional information and supplements thereto for existing shareholders,
reports, statements, and confirmations to shareholders and proxy material that
are not attributable to a class; (l) costs of mailing prospectuses, statements
of additional information and supplements thereto to existing shareholders, as
well as reports to shareholders and proxy material that are not attributable to
a class; (m) any extraordinary expenses; (n) fees, voluntary assessments and
other expenses incurred in connection with membership in investment company
organizations; (o) costs of mailing and tabulating proxies and costs of
shareholders' and directors' meetings; (p) costs of PFPC's use of independent
pricing services to value a portfolio's securities; and (q) the cost of
investment company literature and other publications provided by RBB to its
directors and officers. Distribution expenses, transfer agency expenses,
expenses of preparation, printing and mailing prospectuses, statements of
additional information, proxy statements and reports to shareholders, and
organizational expenses and registration fees, identified as belonging to a
particular class of RBB, are allocated to such class.
Under the Advisory Contracts, Numeric will not be liable for any error of
judgment or mistake of law or for any loss suffered by RBB or the Funds in
connection with the performance of an Advisory Contract, except a loss resulting
from willful misfeasance, bad faith or gross negligence on the part of Numeric
in the performance of its duties or from reckless disregard of its duties and
obligations thereunder.
The Advisory Contracts were approved on April 24, 1996 by vote of RBB's
Board of Directors, including a majority of those directors who are not parties
to the Advisory Contracts or interested persons (as defined in the 1940 Act) of
such parties. The Advisory Contracts are terminable by vote of RBB's Board of
Directors or by the holders of a majority of the outstanding voting securities
of the Funds, at any time without penalty, on 60 days' written notice to
Numeric. The Advisory Contracts became effective on May __, 1996 and were
approved by written consent of the sole shareholder of each of the Funds on May
__, 1996. The Advisory Contracts terminate automatically in the event of
assignment thereof.
CUSTODIAN AGREEMENTS
Custodian Trust Company ("CTC") is custodian of the Funds' assets pursuant
to custodian agreements dated May __, 1996, (the "Custodian Agreements"). Under
the Custodian Agreements, CTC (a) maintains a separate account or accounts in
the name of each of the Funds, (b) holds and transfers portfolio securities on
account of each of the Funds, (c) accepts receipts and makes disbursements of
money on behalf of each of the Funds, (d) collects and receives all income and
other payments and distributions on account of each of the Funds' portfolio
securities and (e) makes periodic reports to the RBB's Board of Directors
concerning the Funds' operations. CTC is authorized to select one or more banks
or trust companies to serve as sub-custodian on behalf of the Funds, provided
that CTC remains responsible for the performance of all its duties under the
Custodian Agreements and holds RBB harmless from the acts and omissions of any
sub-custodian. For its services to the Funds under the Custodian Agreements, CTC
receives a fee calculated as .015% of each Fund's average daily gross assets,
with a minimum monthly fee of $417 per Fund, exclusive of transaction charges
and out-of-pocket expenses, which are also charged to the Funds.
TRANSFER AGENCY AGREEMENTS
PFPC, Inc. ("PFPC"), an affiliate of PNC Bank, serves as the transfer and
dividend disbursing agent for the Funds pursuant to a Transfer Agency Agreement
dated August 16, 1988 (the "Transfer Agency Agreement"). Under the Transfer
Agency Agreement, PFPC (a) issues and redeems Shares of the Classes, (b)
addresses and mails all communications by the Funds to record owners of shares
of the Classes, including reports to shareholders, dividend and distribution
notices and proxy materials for its meetings of shareholders, (c) maintains
shareholder accounts and, if requested, sub-accounts and (d) makes periodic
reports to RBB's Board of Directors concerning the operations of the Classes.
For its services to the Fund under the Transfer Agency Agreement, PFPC receives
a fee at the annual rate of $12 per account for the Funds, exclusive of
out-of-pocket expenses, and also receives reimbursement of its out-of-pocket
expenses.
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CO-ADMINISTRATION AGREEMENTS
Bear Stearns Funds Management Inc. ("BSFM") serves as
co-administrator to the Funds pursuant to Co-Administration Agreements dated May
__, 1996 for each of the Funds (the "BSFM Co-Administration Agreements"). BSFM
has agreed to assist each of the Funds in all significant aspects of their
administration and operations. The BSFM Co-Administration Agreements provide
that BSFM shall not be liable for any error of judgment or mistake of law or any
loss suffered by RBB or the Funds in connection with the performance of the
agreement, except a loss resulting from willful misfeasance, bad faith or
negligence, or reckless disregard of its duties and obligations thereunder. In
consideration for providing services pursuant to the BSFM Co-Administration
Agreements, BSFM receives a fee with respect to each of the Funds calculated at
an annual rate of .05% of each Fund's average daily net assets.
PFPC also serves as co-administrator to Funds pursuant to Co-Administration
Agreements dated May __, 1996 (the "PFPC Co-Administration Agreements"). PFPC
has agreed to calculate the Funds' net asset values, provide all accounting
services for the Funds, and assist in related aspects of the Funds' operations.
The PFPC Co-Administration Agreements provide that PFPC shall not be liable for
any error of judgment or mistake of law or any loss suffered by RBB or the Funds
in connection with the performance of the agreement, except a loss resulting
from willful misfeasance, bad faith or negligence, or reckless disregard of its
duties and obligations thereunder. In consideration for providing services
pursuant to the PFPC Co-Administration Agreements, PFPC receives a fee with
respect to each of the Funds calculated at an annual rate of .115% of each
Fund's average daily net assets, exclusive of out-of-pocket expenses and pricing
charges.
ADMINISTRATIVE SERVICES AGENT
Counsellors Funds Service, Inc. ("Counsellors Service"), a wholly-owned
subsidiary of Counsellors Securities Inc. ("Counsellors" or the "Distributor"),
provides certain administrative services to each of the Portfolios that are not
provided by BSFM or PFPC, subject to the supervision and direction of the Board
of Directors of RBB. These services include furnishing certain internal
quasi-legal, executive and administrative services, acting as liaison between
the Funds and the Funds' various service providers, furnishing corporate
secretarial services, which include assisting in the preparation of materials
for meetings of RBB's Board of Directors, coordinating the preparation of proxy
statements and annual, semi-annual and quarterly reports and generally assisting
in monitoring and developing compliance procedures for the Funds. As
compensation for such administrative services, RBB will pay to Counsellors
Service each month a fee for the previous month calculated at the annual rate of
.15% of each Fund's average daily net assets.
DISTRIBUTOR
Counsellors serves as distributor of the Shares. Counsellors is a
wholly-owned subsidiary of Warburg, Pincus Counsellors, Inc. ("WPC") and is
located at 466 Lexington Avenue, New York 10017-3147. WPC is a wholly-owned
subsidiary of Warburg, Pincus Counsellors, G.P. No compensation is payable by
RBB to Counsellors for distribution services with respect to the Funds.
FUND TRANSACTIONS
Subject to policies established by the Board of Directors, Numeric is
responsible for the execution of portfolio transactions and the allocation of
brokerage transactions for the Funds. In executing portfolio transactions,
Numeric seeks to obtain the best net results for the Funds, taking into account
such factors as the price (including the applicable brokerage commission or
dealer spread), size of the order, difficulty of execution and operational
facilities of the firm involved. While Numeric generally seeks reasonably
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competitive commission rates, payment of the lowest commission or spread is
not necessarily consistent with obtaining the best results in particular
transactions.
No Fund has any obligation to deal with any broker or group of
brokers in the execution of portfolio transactions. Numeric may, consistent with
the interests of the Funds and subject to the approval of the Board of
Directors, select brokers on the basis of the research, statistical and pricing
services they provide to the Funds and other clients of Numeric. Information and
research received from such brokers will be in addition to, and not in lieu of,
the services required to be performed by Numeric under its respective contracts.
A commission paid to such brokers may be higher than that which another
qualified broker would have charged for effecting the same transaction, provided
that Numeric, as applicable, determines in good faith that such commission is
reasonable in terms either of the transaction or the overall responsibility of
Numeric, as applicable, to a Fund and its other clients and that the total
commissions paid by a Fund will be reasonable in relation to the benefits to a
Fund over the long-term.
Corporate debt and U.S. Government securities and many micro- and small-cap
stocks are generally traded on the over-the-counter market on a "net" basis
without a stated commission, through dealers acting for their own account and
not as brokers. The Funds will primarily engage in transactions with these
dealers or deal directly with the issuer unless a better price or execution
could be obtained by using a broker. Prices paid to a dealer in debt, micro- or
small-cap securities will generally include a "spread," which is the difference
between the prices at which the dealer is willing to purchase and sell the
specific security at the time, and includes the dealer's normal profit.
Numeric may seek to obtain an undertaking from issuers of commercial paper
or dealers selling commercial paper to consider the repurchase of such
securities from the Funds prior to their maturity at their original cost plus
interest (sometimes adjusted to reflect the actual maturity of the securities),
if it believes that the Funds' anticipated need for liquidity makes such action
desirable. Any such repurchase prior to maturity reduces the possibility that
the Funds would incur a capital loss in liquidating commercial paper (for which
there is no established market), especially if interest rates have risen since
acquisition of the particular commercial paper.
Investment decisions for the Funds and for other investment accounts
managed by Numeric are made independently of each other in the light of
differing conditions. However, the same investment decision may occasionally be
made for two or more of such accounts. In such cases, simultaneous transactions
are inevitable. Purchases or sales are then averaged as to price and allocated
as to amount according to a formula deemed equitable to each such account. While
in some cases this practice could have a detrimental effect upon the price or
value of the security as far as a Fund is concerned, in other cases it is
believed to be beneficial to the Funds. The Funds will not purchase securities
during the existence of any underwriting or selling group relating to such
security of which Numeric or any affiliated person (as defined in the 1940 Act)
thereof is a member except pursuant to procedures adopted by RBB's Board of
Directors pursuant to Rule 10f-3 under the 1940 Act. Among other things, these
procedures, which will be reviewed by RBB's Directors as deemed necessary from
time to time, require that the commission paid in connection with such a
purchase be reasonable and fair, that the purchase be at not more than the
public offering price prior to the end of the first business day after the date
of the public offer, and that Numeric not participate in or benefit from the
sale to a Fund. In no instance will portfolio securities be purchased from or
sold to Counsellors Securities, PNC Bank or Numeric or any affiliated person of
the foregoing entities except as permitted by SEC exemptive order or by
applicable law.
A high rate of portfolio turnover involves correspondingly greater
brokerage commission expenses and other transaction costs, which must be borne
directly by a Fund. Federal income tax laws may restrict the extent to which a
Fund may engage in short term trading of securities. See "Taxes." The Funds
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anticipate that their annual portfolio turnover rates will vary from year to
year, but will generally range between 150% and 300%. The portfolio turnover
rate is calculated by dividing the lesser of a Fund's annual sales or purchases
of portfolio securities (exclusive of purchases or sales of securities whose
maturities at the time of acquisition were one year or less) by the monthly
average value of the securities in the portfolio during the year.
PURCHASE AND REDEMPTION INFORMATION
The Funds reserve the right, if conditions exist which make cash payments
undesirable, to honor any request for redemption or repurchase of a Fund's
shares by making payment in whole or in part in securities chosen by RBB and
valued in the same way as they would be valued for purposes of computing a
Fund's net asset value. If payment is made in securities, a shareholder may
incur transaction costs in converting these securities into cash. RBB has
elected, however, to be governed by Rule 18f-1 under the 1940 Act so that a Fund
is obligated to redeem its shares solely in cash up to the lesser of $250,000 or
1% of its net asset value during any 90-day period for any one shareholder of a
Fund.
Under the 1940 Act, a Fund may suspend the right to redemption or postpone
the date of payment upon redemption for any period during which the New York
Stock Exchange (the "NYSE") is closed (other than customary weekend and holiday
closings), or during which trading on the NYSE is restricted, or during which
(as determined by the SEC by rule or regulation) an emergency exists as a result
of which disposal or valuation of portfolio securities is not reasonably
practicable, or for such other periods as the SEC may permit. (A Fund may also
suspend or postpone the recordation of the transfer of its shares upon the
occurrence of any of the foregoing conditions.)
VALUATION OF SHARES
The net asset value per share of each Fund is calculated as of 4:00 p.m.
Eastern Time on each Business Day. "Business Day" means each weekday when the
NYSE is open. Currently, the NYSE is closed on New Year's Day, Presidents' Day,
Good Friday, Memorial Day, Independence Day (observed), Labor Day, Thanksgiving
Day and Christmas Day (observed). Securities which are listed on stock exchanges
are valued at the last sale price on the day the securities are valued or,
lacking any sales on such day, at the mean of the bid and asked prices available
prior to the evaluation. In cases where securities are traded on more than one
exchange, the securities are generally valued on the exchange designated by the
Board of Directors as the primary market. Securities traded in the
over-the-counter market and listed on the National Association of Securities
Dealers Automatic Quotation System ("NASDAQ") are valued at the last trade price
listed on the NASDAQ at 4:00 p.m.; securities listed on NASDAQ for which there
were no sales on that day and other over-the-counter securities are valued at
the mean of the bid and asked prices available prior to valuation. Securities
for which market quotations are not readily available are valued at fair value
as determined in good faith by or under the direction of RBB's Board of
Directors. The amortized cost method of valuation may also be used with respect
to debt obligations with sixty days or less remaining to maturity.
In determining the approximate market value of portfolio investments, the
Funds may employ outside organizations, which may use a matrix or formula method
that takes into consideration market indices, matrices, yield curves and other
specific adjustments. This may result in the securities being valued at a price
different from the price that would have been determined had the matrix or
formula method not been used. All cash, receivables and current payables are
carried on the Funds' books at their face value. Other assets, if any, are
valued at fair value as determined in good faith by or under the direction of
RBB's Board of Directors.
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PERFORMANCE INFORMATION
TOTAL RETURN. For purposes of quoting and comparing the performance of the
Funds to that of other mutual funds and to stock or other relevant indices in
advertisements or in reports to shareholders, performance may be stated in terms
of total return. Under the rules of the Securities and Exchange Commission,
funds advertising performance must include total return quotes calculated
according to the following formula:
P(1 + T)n = ERV
Where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years (1, 5 or 10)
ERV = ending redeemable value at the end of
the 1, 5 or 10 year periods (or
fractional portion thereof) of a
hypothetical $1,000 payment made at the
beginning of the 1, 5 or 10 year periods.
Under the foregoing formula, the time periods used in advertising will be
based on rolling calendar quarters, updated to the last day of the most recent
quarter prior to submission of the advertisement for publication, and will cover
one, five and ten year periods or a shorter period dating from the effectiveness
of the Funds' registration statement. In calculating the ending redeemable
value, the maximum sales load is deducted from the initial $1,000 payment and
all dividends and distributions by the Funds are assumed to have been reinvested
at net asset value, as described in the Prospectus, on the reinvestment dates
during the period. Total return, or "T" in the formula above, is computed by
finding the average annual compounded rates of return over the 1, 5 and 10 year
periods (or fractional portion thereof) that would equate the initial amount
invested to the ending redeemable value. Any sales loads that might in the
future be made applicable at the time to reinvestments would be included as
would any recurring account charges that might be imposed by the Funds.
PERFORMANCE. From time to time, the Funds may advertise their average
annual total return over various periods of time. These total return figures
show the average percentage change in value of an investment in a Fund from the
beginning of the measuring period to the end of the measuring period. The
figures reflect changes in the price of a Fund's shares assuming that any income
dividends and/or capital gain distributions made by a Fund during the period
were reinvested in shares of the Fund. Total return will be shown for recent
one-, five- and ten-year periods, and may be shown for other periods as well
(such as from commencement of a Fund's operations or on a year-by-year,
quarterly or current year-to-date basis).
When considering average total return figures for periods longer than one
year, it is important to note that a Fund's annual total return for one year in
the period might have been grater or less than the average for the entire
period. When considering total return figures for periods shorter than one year,
investors should bear in mind that the Funds seek long-term appreciation and
that such return may not be representative of a Fund's return over a longer
market cycle. The Funds may also advertise aggregate total return figures for
various periods, representing the cumulative change in value of an investment in
a Fund for the specific period (again reflecting changes in a Fund's share
prices and assuming reinvestment of dividends and distributions). Aggregate and
average total returns may be shown by means of schedules, charts or graphs, may
indicate various components of total return (i.e., change in value of initial
investment, income dividends and capital gain distributions) and would be quoted
separately for each class of a Fund's shares.
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Investors should note that total return figures are based on historical
earnings and are not intended to indicate future performance.
In reports or other communications to investors or in advertising material,
the Funds may describe general economic and market conditions affecting the
Funds and may compare their performance with (1) that of other mutual funds as
listed in the rankings prepared by Lipper Analytical Services, Inc. or similar
investment services that monitor the performance of mutual funds or as set forth
in the publications listed below; (2) with their benchmark indices, as well as
the S&P 500 or (3) other appropriate indices of investment securities or with
data developed by Numeric derived from such indices. Performance information may
also include evaluation of the Funds by nationally recognized ranking services
and information as reported in financial publications such as Business Week,
Fortune, Institutional Investor, Money Magazine, Forbes, Barron's, The Wall
Street Journal, The New York Times, or other national, regional or local
publications.
In reports or other communications to investors or in
advertising, the Funds may also describe the general biography or work
experience of the portfolio managers of the Funds and may include quotations
attributable to the portfolio managers describing approaches taken in managing
the Funds' investments, research methodology, underlying stock selection or the
Funds' investment objective. The Funds may also discuss the continuum of risk
and return relating to different investments, and the potential impact of
foreign stock on a portfolio otherwise composed of domestic securities. In
addition, the Funds may from time to time compare their expense ratios to those
of investment companies with similar objective and policies, as advertised by
Lipper Analytical Services, Inc.
or similar investment services that monitor mutual funds.
YIELD. The Funds may also advertise their yield. Under the rules of the
SEC, a Fund advertising yield must calculate yield using the following formula:
YIELD = 2 [(A-B+1)6 - 1]
cd
Where: a = dividends and interest earned during the period.
b = expenses accrued for the period (net of reimbursement).
c = the average daily number of shares outstanding during
the period that were entitled to receive dividends.
d = the maximum offering price per share on the last day
of the period.
Under the foregoing formula, yield is computed by compounding
semi-annually, the net investment income per share earned during a 30 day period
divided by the maximum offering price per share on the last day of the period.
For the purpose of determining the interest earned (variable "a" in the formula)
on debt obligations that were purchased by a Fund at a discount or premium, the
formula generally calls for amortization of the discount or premium; the
amortization schedule will be adjusted monthly to reflect changes in the market
values of the debt obligations.
Yield may fluctuate daily and does not provide a basis for determining
future yields. Because the yields will fluctuate, they cannot be compared with
yields on savings account or other investment alternatives that provide an
agreed to or guaranteed fixed yield for a stated period of time. However, yield
information may be useful to an investor considering temporary investments in
money market instruments. In comparing the yield of one fund to another,
consideration should be given to each fund's investment policies, including the
types of investments made, lengths of maturities of the portfolio securities,
the method used by
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each fund to compute the yield (methods may differ) and whether there are any
special account charges which may reduce the effective
yield.
The yields on certain obligations are dependent on a variety of factors,
including general market conditions, conditions in the particular market for the
obligation, the financial condition of the issuer, the size of the offering, the
maturity of the obligation and the rates on the issue. The ratings of Moody's
Investors Service, Inc. and Standard & Poor's Corporation represent their
respective opinions as to the quality of the obligations they undertake to rate.
Ratings, however, are general and are not absolute standards of quality.
Consequently, obligations with the same rating, maturity and interest rate may
have different market prices. In addition, subsequent to its purchase by a Fund,
an issue may cease to be rated or may have its rating reduced below the minimum
required for purchase. In such an event, the Fund's investment adviser or
sub-adviser will consider whether the Fund should continue to hold the
obligation.
From time to time, in advertisements or in reports to shareholders with
respect to the Funds, the yields of the Funds may be quoted and compared to
those of other mutual funds with similar investment objectives and to stock or
other relevant indices. For example, the yield of a Fund may be compared to data
prepared by Lipper Analytical Services, Inc., a widely-recognized independent
service that monitors the performance of mutual funds.
TAXES
The following is only a summary of certain additional tax considerations
generally affecting the Funds and their shareholders that are not described in
the Prospectus. No attempt is made to present a detailed explanation of the tax
treatment of the Funds or their shareholders, and the discussion here and in the
Funds' Prospectus is not intended as a substitute for careful tax planning.
Investors are urged to consult their tax advisers with specific reference to
their own tax situation.
The Funds intend to elect to be taxed as and meet the
requirements of regulated investment companies under Part I of Subchapter M of
the Internal Revenue Code of 1986, as amended (the "Code"). As regulated
investment companies, the Funds are exempt from Federal income tax on their net
investment income and realized capital gains which they distribute to
shareholders, provided that they distribute an amount equal to the sum of (a) at
least 90% of their investment company taxable income (net taxable investment
income and the excess of net short-term capital gain over net long-term capital
loss), if any, for the year and (b) at least 90% of their net tax-exempt
interest income, if any, for the year (the "Distribution Requirement") and
satisfy certain other requirements of the Code that are described below.
Distributions of investment company taxable income and net tax-exempt interest
income made during the taxable year or, under specified circumstances, within
twelve months after the close of the taxable year will satisfy the Distribution
Requirement. The Distribution Requirement for any year may be waived if a
regulated investment company establishes to the satisfaction of the Internal
Revenue Service that it is unable to satisfy the Distribution Requirement by
reason of distributions previously made for the purpose of avoiding liability
for Federal excise tax (discussed below).
In addition to satisfaction of the Distribution Requirement each Fund must
derive at least 90% of its gross income from dividends, interest, certain
payments with respect to securities loans and gains from the sale or other
disposition of stock or securities or foreign currencies, or from other income
derived with respect to its business of investing in such stock, securities, or
currencies (the "Income Requirement") and derive less than 30% of its gross
income from the sale or other disposition of any of the following investments,
if such investments were held for less than three months: (a) stock or
securities (as defined in Section 2(a)(36) of the 1940 Act); (b) options,
futures, or forward contracts (other than options, futures or forward contracts
on foreign currencies); and (c) foreign currencies (or options, futures or
forward contracts on foreign currencies) but only
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if such currencies (or options, futures or forward contracts) are not directly
related to the regulated investment company's principal business of investing in
stock or securities (or options and futures with respect to stocks or
securities) (the "Short-Short Gain Test"). Interest (including accrued original
issue discount and, in the case of debt securities bearing taxable interest
income, "accrued market discount") received by a Fund at maturity or on
disposition of a security held for less than three months will not be treated as
gross income derived from the sale or other disposition of such security for
purposes of the Short-Short Gain Test. However, any other income which is
attributable to realized market appreciation will be treated as gross income
from the sale or other disposition of securities for this purpose.
Future Treasury regulations may provide that currency gains that are not
"directly related" to a Fund's principal business of investing in stock or
securities (or in options or futures with respect to stock or securities) will
not satisfy the Income Requirements. Income derived by a regulated investment
company from a partnership or trust will satisfy the Income Requirement only to
the extent such income is attributable to items of income of the partnership or
trust that would satisfy the Income Requirement if they were realized by a
regulated investment company in the same manner as realized by the partnership
or trust.
In addition to the foregoing requirements, at the close of each quarter of
its taxable year, at least 50% of the value of a Fund's assets must consist of
cash and cash items, U.S. Government securities, securities of other regulated
investment companies, and securities of other issuers (as to which a Fund has
not invested more than 5% of the value of its total assets in securities of such
issuer and as to which a Fund does not hold more than 10% of the outstanding
voting securities of such issuer), and no more than 25% of the value of a Fund's
total assets may be invested in the securities of any one issuer (other than
U.S. Government securities and securities of other regulated investment
companies), or in two or more issuers which such Fund controls and which the
engaged in the same or similar trades or businesses (the "Asset Diversification
Requirement").
The Internal Revenue Service has taken the position, in informal rulings
issued to other taxpayers, that the issuer of a repurchase agreement is the bank
or dealer from which securities are purchased. A Fund will not enter into
repurchase agreements with any one bank or dealer if entering into such
agreements would, under the informal position expressed by the Internal Revenue
Service, cause it to fail to satisfy the Asset Diversification Requirement.
Distributions of investment company taxable income will be taxable (subject
to the possible allowance of the dividend received deduction described below) to
shareholders as ordinary income, regardless of whether such distributions are
paid in cash or are reinvested in shares. Shareholders receiving any
distribution from the Funds in the form of additional shares will be treated as
receiving a taxable distribution in an amount equal to the fair market value of
the shares received, determined as of the reinvestment date.
The Funds intend to distribute to shareholders their excess of net
long-term capital gain over net short-term capital loss ("net capital gain"), if
any, for each taxable year. Such gain is distributed as a capital gain dividend
and is taxable to shareholders as long-term capital gain, regardless of the
length of time the shareholder has held his shares, whether such gain was
recognized by a Fund prior to the date on which a shareholder acquired shares of
the Fund and whether the distribution was paid in cash or reinvested in shares.
The aggregate amount of distributions designated by any Fund as capital gain
dividends may not exceed the net capital gain of a Fund for any taxable year,
determined by excluding any net capital loss or net long-term capital loss
attributable to transactions occurring after October 31 of such year and by
treating any such loss as if it arose on the first day of the following taxable
year. Such distributions will be designated as capital gain dividends in a
written notice mailed by a Fund to shareholders not later than 60 days after the
close of each Fund's respective taxable year.
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In the case of corporate shareholders, distributions (other than capital
gain dividends) of a Fund for any taxable year generally qualifies for the 70%
dividends received deduction to the extent of the gross amount of "qualifying
dividends" received by a Fund for the year. Generally, a dividend will be
treated as a "qualifying dividend" if it has been received from a domestic
corporation. However, a dividend received by a taxpayer will not be treated as a
"qualifying dividend" if (1) it has been received with respect to any share of
stock that the taxpayer has held for 45 days (90 days in the case of certain
preferred stock) or less (excluding any day more than 45 days (or 90 days in the
case of certain preferred stock) after the date on which the stock becomes
ex-dividend), or (2) to the extent that the taxpayer is under an obligation
(pursuant to a short sale or otherwise) to make related payments with respect to
positions in substantially similar or related property. RBB will designate the
portion, if any, of the distribution made by a Fund that qualifies for the
dividends received deduction in a written notice mailed by a Fund to
shareholders not later than 60 days after the close of the Fund's taxable year.
Investors should note that changes made to the Code by the Tax Reform Act
of 1986 and subsequent legislation have not entirely eliminated distinctions in
the tax treatment of capital gain and ordinary income distributions. The nominal
maximum marginal rate on ordinary income for individuals, trusts and estates is
currently 31%, but for individual taxpayers whose adjusted gross income exceeds
certain threshold amounts (that differ depending on the taxpayer's filing
status) in taxable years beginning before 1986, provisions phasing out personal
exemptions and limiting itemized deductions may cause the actual maximum
marginal rate to exceed 31%. The maximum rate on the net capital gain of
individuals, trusts and estates, however, is in all cases 28%. Capital gains and
ordinary income of corporate taxpayers are taxed at a nominal maximum rate of
34% (an effective marginal rate of 39% applies in the case of corporations
having taxable income between $100,000 and $335,000). Investors should be aware
that any loss realized upon the sale, exchange or redemption of shares held for
six months or less will be treated as a long-term capital loss to the extent any
capital gain dividends have been paid with respect to such shares.
Distributions of net investment income received by the Funds from
investments in debt securities will be taxable to shareholders as ordinary
income and will not be treated as "qualifying dividends" for purposes of the
dividends received deduction.
If for any taxable year any Fund does not qualify as a regulated investment
company, all of its taxable income will be subject to tax at regular corporate
rates without any deduction for distributions to shareholders, and all
distributions will be taxable as ordinary dividends to the extent of such Fund's
current and accumulated earning and profits. Such distributions will be eligible
for the dividends received deduction in the case of corporate shareholders.
Investors should be aware that any loss realized on a sale of shares of a Fund
will be disallowed to the extent an investor repurchases shares of the same Fund
within a period of 61 days (beginning 30 days before and ending 30 days after
the day of disposition of the shares). Dividends paid by a Fund in the form of
shares within the 61-day period would be treated as a purchase for this purpose.
A shareholder will recognize gain or loss upon an exchange of shares of a
Fund for shares of another Fund upon exercise of an exchange privilege.
Shareholders may not include the initial sales charge in the tax basis of the
Shares exchanged for shares of another Fund for the purpose of determining gain
or loss on the exchange, where the Shares exchanged have been held 90 days or
less. The sales charge will increase the basis of the shares acquired through
exercise of the exchange privilege (unless the shares acquired are also
exchanged for shares of another Fund within 90 days after the first exchange).
The Code imposes a non-deductible 4% excise tax on regulated investment
companies that do not distribute with respect to each calendar year an amount
equal to 98% of their ordinary income for the calendar year plus 98% of their
capital gain net income for the one-year period ending on October 31 of such
calendar year. The balance of such income must be distributed during the next
calendar year. For the foregoing purposes, a company is treated as having
distributed any amount on which it is subject to income tax
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for any taxable year ending in such calendar year. Because the Funds intend to
distribute all of their taxable income currently, no Fund anticipates incurring
any liability for this excise tax. However, investors should note that the Funds
may in certain circumstances be required to liquidate investments in order to
make sufficient distributions to avoid excise tax liability.
A Fund will be required in certain cases to withhold and remit to the
United States Treasury 31% of dividends paid to any shareholder (1) who has
provided either an incorrect tax identification number or no number at all, (2)
who is subject to backup withholding by the Internal Revenue Service for failure
to report the receipt of interest or dividend income properly, or (3) who has
failed to certify to RBB that he is not subject to backup withholding or that he
is an "exempt recipient."
The foregoing general discussion of Federal income tax consequences is
based on the Code and the regulations issued thereunder as in effect on the date
of this Statement of Additional Information. Future legislative or
administrative changes or court decisions may significantly change the
conclusions expressed herein, and any such changes or decisions may have a
retroactive effect with respect to the transactions contemplated herein.
Although the Funds expect to qualify as a "regulated investment company"
and to be relieved of all or substantially all Federal income taxes, depending
upon the extent of their activities in states and localities in which their
offices are maintained, in which their agents or independent contractors are
located or in which they are otherwise deemed to be conducting business, the
Funds may be subject to the tax laws of such states or localities.
DESCRIPTION OF SHARES
RBB has authorized capital of thirty billion shares of Common Stock, $.001
par value per share, of which 12.35 billion shares are currently classified as
follows: 100 million shares are classified as Class A Common Stock (Growth &
Income), 100 million shares are classified as Class B Common Stock, 100 million
shares are classified as Class C Common Stock (Balanced), 100 million shares are
classified as Class D Common Stock (Tax-Free), 500 million shares are classified
as Class E Common Stock (Money), 500 million shares are classified as Class F
Common Stock (Municipal Money), 500 million shares are classified as Class G
Common Stock (Money), 500 million shares are classified as Class H Common Stock
(Municipal Money), 1 billion shares are classified as Class I Common Stock
(Money), 500 million shares are classified as Class J Common Stock (Municipal
Money), 500 million shares are classified as Class K Common Stock (U.S.
Government Money), 1,500 million shares are classified as Class L Common Stock
(Money), 500 million shares are classified as Class M Common Stock (Municipal
Money), 500 million shares are classified as Class N Common Stock (U.S.
Government Money), 500 million shares are classified as Class O Common Stock
(N.Y. Money), 100 million shares are classified as Class P Common Stock
(Government), 100 million shares are classified as Class Q Common Stock, 500
million shares are classified as Class R Common Stock (Municipal Money), 500
million shares are classified as Class S Common Stock (U.S. Government Money),
500 million shares are classified as Class T Common Stock (International), 500
million shares are classified as Class U Common Stock (High Yield), 500 million
shares are classified as Class V Common Stock (Emerging), 100 million shares are
classified as Class W Common Stock, 50 million shares are classified as Class X
Common Stock (U.S. Core Equity), 50 million shares are classified as Class Y
Common Stock (U.S. Core Fixed Income), 50 million shares are classified as Class
Z Common Stock (Global Fixed Income), 50 million shares are classified as Class
AA Common Stock (Municipal Bond), 50 million shares are classified as Class BB
Common Stock (BEA Balanced), 50 million shares are classified as Class CC Common
Stock (Short Duration), 100 million shares are classified as Class DD Common
Stock (Growth & Income Series 2), 100 million shares are classified as Class EE
Common Stock (Balanced Series 2), 50 million shares are classified as Class FF
23
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Common Stock (Numeric Micro Cap), 50 million shares are classified as Class GG
Common Stock (Numeric Growth), 50 million shares are classified as Class HH
Common Stock (Numeric Mid Cap), 700 million shares are classified as Class Alpha
1 Common Stock (Money), 200 million shares are classified as Class Alpha 2
Common Stock (Municipal Money), 500 million shares are classified as Class Alpha
3 Common Stock (U.S. Government Money), 100 million shares are classified as
Class Alpha 4 Common Stock (N.Y. Money), 1 million shares are classified as
Class Beta 1 Common Stock (Money), 1 million shares are classified as Class Beta
2 Common Stock (Municipal Money), 1 million shares are classified as Class Beta
3 Common Stock (U.S. Government Money), 1 million shares are classified as Class
Beta 4 Common Stock (N.Y. Money), 1 million shares are classified as Gamma 1
Common Stock (Money), 1 million shares are classified as Gamma 2 Common Stock
(Municipal Money), 1 million shares are classified as Gamma 3 Common Stock (U.S.
Government Money), 1 million shares are classified as Gamma 4 Common Stock (N.Y.
Money), 1 million shares are classified as Delta 1 Common Stock (Money), 1
million shares are classified as Delta 2 Common Stock (Municipal Money), 1
million shares are classified as Delta 3 Common Stock (U.S. Government Money), 1
million shares are classified as Delta 4 Common Stock (N.Y. Money), 1 million
shares are classified as Epsilon 1 Common Stock (Money), 1 million shares are
classified as Epsilon 2 Common Stock (Municipal Money), 1 million shares are
classified as Epsilon 3 Common Stock (U.S. Government Money), 1 million shares
are classified as Epsilon 4 Common Stock (N.Y. Money), 1 million shares are
classified as Zeta 1 Common Stock (Money), 1 million shares are classified as
Zeta 2 Common Stock (Municipal Money), 1 million shares are classified as Zeta 3
Common Stock (U.S. Government Money), 1 million shares are classified as Zeta 4
Common Stock (N.Y. Money), 1 million shares are classified as Eta 1 Common Stock
(Money), 1 million shares are classified as Eta 2 Common Stock (Municipal
Money), 1 million shares are classified as Eta 3 Common Stock (U.S. Government
Money), 1 million shares are classified as Eta 4 Common Stock (N.Y. Money), 1
million shares are classified as Theta 1 Common Stock (Money), 1 million shares
are classified as Theta 2 Common Stock (Municipal Money), 1 million shares are
classified as Theta 3 Common Stock (U.S. Government Money), and 1 million shares
are classified as Theta 4 Common Stock (N.Y. Money). Shares of the Class FF, GG
and HH Common Stock constitute the Classes of the Micro Cap, Growth and Mid Cap
Funds, respectively. Under RBB's charter, the Board of Directors has the power
to classify or reclassify any unissued shares of Common Stock from time to time.
The classes of Common Stock have been grouped into sixteen
separate "families": the RBB Family, the Warburg Pincus Family, the Cash
Preservation Family, the Sansom Street Family, the Bedford Family, the Bradford
Family, the BEA Family, the Janney Montgomery Scott Money Family, the Numeric
Family, the Beta Family, the Gamma Family, the Delta Family, the Epsilon Family,
the Zeta Family, the Eta Family and the Theta Family. The RBB Family represents
interests in one non-money market portfolio as well as the Money Market and
Municipal Money Market Portfolios; the Warburg Pincus Family represents
interests in the Growth & Income, Balanced and Tax Free Funds; the Cash
Preservation Family represents interests in the Money Market and Municipal Money
Market Portfolios; the Sansom Street Family represents interests in the Money
Market, Municipal Money Market and Government Obligations Money Market
Portfolios; Bedford Family represents interests in the Money Market, Municipal
Money Market, Government Obligations Money Market and New York Municipal Money
Market Portfolios; the Bradford Family represents interests in the Municipal
Money Market and Government Obligations Money Market Portfolios; the BEA Family
represents interests in nine non-money market portfolios; the Numeric Family
represents interests in the Micro Cap, Growth and Mid Cap Funds; the Janney
Montgomery Scott Family and the Beta, Gamma, Delta, Epsilon, Zeta, Eta and Theta
Families represent interests in the Money Market, Municipal Money Market,
Government Obligations Money Market and New York Municipal Money Market
Portfolios.
24
<PAGE>
ADDITIONAL INFORMATION CONCERNING FUND SHARES
RBB does not currently intend to hold annual meetings of
shareholders except as required by the 1940 Act or other applicable law. RBB's
amended By-Laws provide that shareholders collectively owning at least ten
percent of the outstanding shares of all classes of Common Stock of RBB have the
right to call for a meeting of shareholders to consider the removal of one or
more directors. To the extent required by law, RBB will assist in shareholder
communication in such matters.
Holders of shares of each class of RBB will vote in the aggregate and not
by class on all matters, except where otherwise required by law. Further,
shareholders of RBB will vote in the aggregate and not by portfolio except as
otherwise required by law or when the Board of Directors determines that the
matter to be voted upon affects only the interests of the shareholders of a
particular portfolio. Rule 18f-2 under the 1940 Act provides that any matter
required to be submitted by the provisions of such Act or applicable state law,
or otherwise, to the holders of the outstanding securities of an investment
company such as RBB shall not be deemed to have been effectively acted upon
unless approved by the holders of a majority of the outstanding shares of each
portfolio affected by the matter. Rule 18f-2 further provides that a portfolio
shall be deemed to be affected by a matter unless it is clear that the interests
of each portfolio in the matter are identical or that the matter does not affect
any interest of the portfolio. Under the Rule, the approval of an investment
advisory agreement or any change in a fundamental investment policy would be
effectively acted upon with respect to a portfolio only if approved by the
holders of a majority of the outstanding voting securities of such portfolio.
However, the Rule also provides that the ratification of the selection of
independent public accountants, the approval of principal underwriting contracts
and the election of directors are not subject to the separate voting
requirements and may be effectively acted upon by shareholders of an investment
company voting without regard to portfolio.
Notwithstanding any provision of Maryland law requiring a greater vote of
shares of RBB's common stock (or of any class voting as a class) in connection
with any corporate action, unless otherwise provided by law, (for example by
Rule 18f-2 discussed above) or by RBB's Charter, RBB may take or authorize such
action upon the favorable vote of the holders of more than 50% of all of the
outstanding shares of Common Stock voting without regard to class (or
portfolio).
MISCELLANEOUS
COUNSEL. The law firm of Ballard Spahr Andrews & Ingersoll, 1735 Market
Street, 51st Floor, Philadelphia, Pennsylvania 19103 serves as counsel to RBB,
PIMC, PNC Bank and PFPC. The law firm of Drinker Biddle & Reath, 1100
Philadelphia National Bank Building, Broad and Chestnut Streets, Philadelphia,
Pennsylvania 19107, serves as counsel to RBB's independent directors.
INDEPENDENT ACCOUNTANTS. Coopers & Lybrand L.L.P., 2400 Eleven Penn Center,
Philadelphia, Pennsylvania 19103, serves as RBB's independent accountants.
CONTROL PERSONS. As of February 27, 1996, to RBB's knowledge, the following
named persons at the addresses shown below owned of record approximately 5% or
more of the total outstanding shares of the class of RBB indicated below. See
"Description of Shares" above. RBB does not know whether such persons also
beneficially own such shares.
25
<PAGE>
PORTFOLIO NAME AND ADDRESS PERCENT OWNED
Warburg Pincus Growth & Charles Schwab & Co., Inc. 33.92
Income Fund Reinvest Account
(Class A) Attn: Mutual Funds Dept.
101 Montgomery Street
San Francisco, CA 94104-4122
National Financial Services Corp. 11.31
FBO Customers
P.O. Box 3908
Church Street Station
New York, New York 10008-3908
Warburg Pincus Balanced Charles Schwab & Co., Inc. 41.79
Fund Reinvest Account
(Class C) Attn: Mutual Funds Dept.
101 Montgomery Street
San Francisco, CA 94104-4122
National Financial Services Corp. 24.23
FBO Customers
P.O. Box 3908
Church Street Station
New York, New York 10008-3908
Warburg Pincus Tax Free Gruntal Co. 10.91
Fund FBO 995-10702-19
(Class D) 14 Wall Street
New York, New York 10005-2176
Gruntal Co. 9.74
FBO 995-16852-14
14 Wall Street
New York, New York 10005-2176
RBB Money Market Luanne M. Garvey and Robert J. Garvey 12.7
Portfolio 2729 Woodland Avenue
(Class E) Trooper, PA 19403
Harold T. Erfer 12.7
414 Charles Lane
Wynnewood, PA 19096
Karen M. McElhinny and
Contribution Account 16.5
4943 King Arthur Drive
Erie, PA 16506
E.L. Haines Jr. and Betty J. Haines 7.7
2341 Pinebluff Drive
Dallas, TX 75228
26
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PORTFOLIO NAME AND ADDRESS PERCENT OWNED
John Robert Estrada and 14.3
Shirley Ann Estrada
1700 Raton Drive
Arlington, TX 76018
Eric Levine and Linda & Howard Levine 28.9
67 Lanes Pond Road
Howell, NJ 07731
RBB Municipal Money William B. Pettus Trust 10.9
Market Portfolio Augustine W. Pettus Trust
(Class F) 827 Winding Path Lane
St. Louis, MO 63021-6635
Seymour Fein 89.1
P.O. Box 486
Tremont Post Office
Bronx, NY 10457-0486
Cash Preservation Money Jewish Family and Children's 46.9
Market Portfolio Agency of Philadelphia
(Class G) Capital Campaign
Attn: S. Ramm
1610 Spruce Street
Philadelphia, PA 19103
Theresa M. Palmer 16.2
5731 N. 4th Street
Philadelphia, PA 19120
Lynda R. Succ Trustee for in Trust under 9.8
The Lynda R. Campbell Caring Trust
935 Rutger Street
St. Louis, MO 63104
Cash Preservation Kenneth Farwell and Valerie 10.9
Municipal Money Market Farwell Jt. Ten
Portfolio 3854 Sullivan
(Class H) St. Louis, MO 63107
Larnie Johnson and Mary Alice Johnson 17.7
4927 Lee Avenue
St. Louis, MO 63115-1726
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PORTFOLIO NAME AND ADDRESS PERCENT OWNED
Andrew Diederich and Doris Diederich 6.0
1003 Lindeman
Des Peres, MO 63131
Marcella L. Haugh Caring Tr 10.2
Dtd 8/12/91
40 Plaza Square
Apt. 202
St. Louis, MO 63101
Gwendolyn Haynes 5.2
2757 Geyer
St. Louis, MO 63104
Sansom Street Money Wasner & Co. 28.5
Market Portfolio FAO Paine Webber and Managed Assets
(Class I) Sundry Holdings
Attn: Joe Domizio
200 Stevens Drive
Lester, PA 19113
Saxon and Co. 66.3
FBO Paine Webber
P.O. Box 7780 1888
Philadelphia, PA 19182
Robertson Stephens & Co. 5.2
FBO Exclusive Benefit Investors
555 California St./#2600
San Francisco, CA 94104
Bedford Municipal Joel E. Smilow 10.0
Money Market 100 Beachside Avenue
(Class M) Greenfarm, CT 0643
Bedford New York John G. Kirsch & Maureen Kirsch Jt. Ten 6.0
Municipal Money Market 140 Riverside Drive, 17K
(Class O) New York, NY 10024-2605
BEA High Yield Portfolio Chase Manhattan Bankers Trustee for 29.6
(Class U) Kendale Company Master Pension Plan
Attn: Mark Tesoriero
3 Metrotech Center, 6th Floor
Brooklyn, NY 11245
Temple Inland Master Retirement Trust 9.7
303 South Temple Drive
Diboll, TX 75941
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PORTFOLIO NAME AND ADDRESS PERCENT OWNED
Guenter Full Trst Michelin 18.1
North America Inc.
Master Trust
P. O. Box 19001
Greenville, SC 29602-9001
Georgetown University Retirement 6.2
Trust Plan Trust
Suite G-05 Maguire Hall
Georgetown University
Washington, DC 20057-1019
BEA Emerging Markets Wachovia Bank North Carolina Trust for 13.0
Equity Portfolio Carolina Power & Light Co. Supplemental
(Class V) Retirement Trust
301 N. Main Street
Winston-Salem, NC 27101
Northern Trust Company Trustee for Texas 18.0
Instruments Employee Plan
P.O. Box 92956
Chicago, IL 60675-2956
Hall Family Foundation 18.0
P.O. Box 419580
Kansas City, MO 64208
Arkansas Public Emploees Retirement System 9.1
124 W. Capitol Avenue
Little Rock, AR 72201
Northern Trust 10.8
Trustee for Pillsbury
P.O. Box 92956
Chicago, IL 60675
Amherst H. Wilder Foundation 5.2
919 Lafond Avenue
St. Paul, MN 55104
BEA US Core Equity Bank of New York 54.6
Portfolio Trust APU Buckeye Pipeline
(Class X) One Wall Street
New York, NY 10286
Werner & Pfleiderer Pension 9.6
Plan Employees
663 E. Crescent Avenue
Ramsey, NJ 07446
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PORTFOLIO NAME AND ADDRESS PERCENT OWNED
BEA Associates 5.3
FAO Profit Sharing Trust
153 E. 53rd Street
New York, NY 10022
C S Fides Trust T743 5.1
Attn Portfolio Management
C/o Credit Suisse Pvt Bkg
12 E. 49th Street, 40th floor
New York, NY 10017
BEA US Core Fixed Income New England UFCW & Employers' Pension 21.5
Portfolio Fund Board of Trustees
(Class Y) 161 Forbes Road, Suite 201
Braintree, MA 02184
Bankers Trust 16.9
Trust Pechniney Corp. Pension Master Trust
34 Exchange Place, 4th Floor
Jersey City, NJ 07302
Patterson & Co. 7.6
P.O. Box 7829
Philadelphia, PA 19102
MAC & Co 5.9
FAO 176-655
ROBF1766552
Mutual Funds Operations
P. O. Box 3198
Pittsburgh, PA 15230-3198
Bank of New York 8.0
Trst Fenway Partners Master Trust
One Wall Street, 12th floor
New York, NY 10286
Citibank NA 13.1
Trst CS First Boston Corp Emp S/P
Attn: Sheila Adams
111 Wall Street, 20th floor Z 1
New York, NY 10043
BEA Global Fixed Income Sunkist Master Trust 39.2
Portfolio 14130 Riverside Drive
(Class Z) Sherman Oaks, CA 91423
Pattersen & Co. 28.0
P. O. Box 7829
Philadelphia, PA 19101
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PORTFOLIO NAME AND ADDRESS PERCENT OWNED
Key Trust Co. of Ohio 22.7
FBO Eastern Enterp. Collective Inv. Trust
P.O. Box 901536
Cleveland, OH 44202-1559
BEA Municipal Bond Fund William A. Marquard 26.9
Portfolio 2199 Maysville Rd.
(Class AA) Carlisle, KY 40311
Arnold Leon 10.4
c/o Fiduciary Trust Company
P.O. Box 3199
Church Street Station
New York, NY 10008
Edgar E. Sharp 7.4
P.O. Box 8338
Longboat Key, FL 34228
John C. Cahill 13.7
c/o David Holmgren
30 White Birch Lane
Cots Cob, CT 06870
Irwin Bard 7.4
1750 North East 183rd St. North
Miami Beach, FL 33160
Warburg Pincus Growth & Connecticut General Life Ins. Co. 98.67
Income on behalf of its Separate Accounts
Series 2 55E 55F 55G c/o Melissa Spencer
(Class DD) M110
CIGNA Corp. P.O. Box 2975
Hartford, CT 06104-2975
Warburg Pincus Balanced Warburg Pincus Counsellors Inc. 85.34
Fund Series 2 Attn: Stephen Distler
(Class EE) 466 Lexington Avenue
10th Floor
New York, New York 10017-3140
Janney Montgomery Scott Janney Montgomery Scott 100
Money Market Portfolio 1801 Market Street
(Class Alpha 1) Philadelphia, PA 19103-1675
Janney Montgomery Scott Janney Montgomery Scott 100
Municipal Money Market 1801 Market Street
Portfolio Philadelphia, PA 19103-1675
(Class Alpha 2)
31
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PORTFOLIO NAME AND ADDRESS PERCENT OWNED
Janney Montgomery Scott Janney Montgomery Scott 100
Government Obligations 1801 Market Street
Money Market Portfolio Philadelphia, PA 19103-1675
(Class Alpha 3)
Janney Montgomery Scott Janney Montgomery Scott 100
New York Municipal Money 1801 Market Street
Market Portfolio Philadelphia, PA 19103-1675
(Class Alpha 4)
As of the above date, directors and officers as a group owned less than one
percent of the shares of RBB.
LITIGATION. There is currently no material litigation affecting RBB.
FINANCIAL STATEMENTS. No financial statements are supplied because, as of
the date of the Prospectus and this Statement of Additional Information, the
Funds had no operating history.
32
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APPENDIX A
RATINGS OF DEBT SECURITIES
STANDARD & POOR'S CORPORATION
AAA Debt rated 'AAA' has the highest rating assigned by Standard &
Poor's. Capacity to pay interest and repay principal is extremely
strong.
AA Debt rated 'AA' has a very strong capacity to pay interest and
repay principal and differs from the highest rated issues only in
a small degree.
A Debt rated 'A' has a strong capacity to pay interest and repay
principal although it is somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than
debt in higher rated categories.
BBB Debt rated "BBB" is regarded as having an adequate capacity to
pay interest and repay principal. Whereas it normally exhibits
adequate protection parameters, adverse economic conditions or
changing circumstances are more likely to lead to a weakened
capacity to pay interest and repay principal for debt in this
category than in higher rated categories.
BB Debt rated 'BB', 'B', 'CCC', or 'CC' is regarded, on balance, as
B predominantly speculative with respect to capacity to pay interest
CCC and repay principal in accordance with the terms of the
CC obligation. 'BB' indicates the lowest degree of speculation and
'CC' the highest degree of speculation. While such debt will
likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to
adverse conditions.
C This rating is reserved for income bonds on which no interest is
being paid.
D Debt rated "D" is in default, and payment of interest and/or
repayment of principal is in arrears.
(+) The ratings from 'AAA' or 'CCC' may be modified by the addition of
OR a plus or minus sign to show relative standing or within the major
(-) rating categories.
* Continuance of the rating is contingent upon S&P's receipt of an
executed copy of the escrow agreement or closing documentation
confirming investments and cash flows.
NR Indicates no rating has been requested, that there is insufficient
information on which to base a rating, or that S&P does not rate a
particular type of obligation as a matter of policy.
DEBT OBLIGATIONS OF ISSUERS OUTSIDE THE UNITED STATES AND ITS
TERRITORIES are rated on the same basis as domestic corporate and
municipal issues. The ratings measure the creditworthiness of the
obligor but do not take into account currency exchange and related
uncertainties.
A-1
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p PROVISIONAL RATINGS: The letter "p" indicates that the rating is
provisional. A provisional rating assumes the successful
completion of the project being financed by the debt being rated
and indicates that payment of debt service requirements is largely
or entirely dependent upon the successful and timely completion of
the project. This rating, however, while addressing credit quality
subsequent to completion of the project, makes no comment on the
likelihood of. or the risk of default upon failure of, such
completion. The investor should exercise judgment with respect to
such likelihood and risk.
NOTES
Note rating symbols are as follows:
SP-1 Very strong or strong capacity to pay principal and interest.
Those issues determined to possess overwhelming safety
characteristics will be given a plus (+) designation.
SP-2 Satisfactory capacity to pay principal and interest.
SP-3 Speculative capacity to pay principal and interest.
COMMERCIAL PAPER
A Standard & Poor's commercial paper rating is a current assessment of the
likelihood of timely payment of debt having an original maturity of no more than
365 days.
Ratings are graded into four categories, ranging from 'A' for the highest
quality obligations to 'D' for the lowest. The four categories are as follows:
A Issues assigned this highest rating are regarded as having the
greatest capacity for timely payment. Issues in this category are
delineated with the numbers 1, 2, and 3 to indicate the relative
degree of safety.
A-1 This designation indicates that the degree of safety regarding
timely payment is either overwhelming or very strong. Those issues
determined to possess overwhelming safety characteristics are
denoted with a plus (+) sign designation.
A-2 Capacity for timely payment on issues with this designation is
strong. However, the relative degree of safety is not as high as
for issues designated 'A-1'.
A-3 Issues carrying this designation have a satisfactory capacity for
timely payment. They are, however, somewhat more vulnerable to the
adverse effects of changes in circumstances than obligations
carrying the higher designations.
B Issues rated 'B' are regarded as having only an adequate capacity
for timely payment. However, such capacity may be damaged by
changing conditions or short-term adversities.
C This rating is assigned to short-term debt obligations with a
doubtful capacity for payment.
A-2
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D This rating indicates that the issue is either in default or is
expected to be in default upon maturity.
VARIABLE RATE DEMAND BONDS
Standard & Poor's assigns "dual" ratings to all long-term debt issues that
have as part of their provisions a long-term rating and a variable rate demand
rating. The first rating addresses the likelihood of repayment of principal and
interest due and the second rating addresses only the demand feature. The
long-term debt rating symbols are used for bonds to denote the long-term
maturity and the commercial paper rating symbols are used to denote the put
option (for example, 'AAA/A-1 +'). If the nominal maturity is short (three years
or less), a note rating is assigned.
MOODY'S INVESTORS SERVICE, INC. RATINGS
CORPORATE BONDS
AAA
Bonds which are rated AAA are judged to be the best quality. They carry the
smallest degree of investment risk and are generally referred to as "gilt edge."
Interest payments are protected by a large or by an exceptionally stable margin
and principal is secure. While the various protective elements are likely to
change, such changes as can be visualized are most unlikely to impair the
fundamentally strong position of such issues.
AA
Bonds which are rated AA are judged to be of high quality by all standards.
Together with the Aaa group they comprise what are generally known as high grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements present which make
the long term risks appear somewhat larger than in Aaa securities.
A
Bonds which are rated A possess many favorable investment attributes and
are to be considered as upper medium grade obligations. Factors giving security
to principal and interest are considered adequate but elements may be present
which suggest a susceptibility to impairment sometime in the future.
BAA
Bonds which are rated BAA are considered as medium grade obligations, i.e.,
they are neither highly protected nor poorly secured. Interest payment and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.
A-3
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BA
Bonds which are rated BA are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of interest
and principal payments may be very moderate and thereby not well safeguarded
during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.
B
Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.
CAA
Bonds which are rated CAA are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal or
interest.
CA
Bonds which are rated CA represent obligations which are speculative in a
high degree. Such issues are often in default or have other marked shortcomings.
C
Bonds which are rated C are the lowest rated class of bonds and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing.
Moody's bond ratings, where specified, are also applied to senior bank
obligations with an original maturity in excess of one year. Among the bank
obligations covered are bank deposits, bankers acceptance and obligations to
deliver foreign exchange. Obligations relying upon support mechanisms such as
letters-of-credit are excluded unless explicitly rated.
NOTE: Moody's applies numerical modifiers, 1, 2 and 3 in each generic
rating classification from Aa through B in its corporate bond rating system. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3 indicates that the issue ranks in the lower end of its generic rating
category.
SHORT-TERM NOTES AND VARIABLE RATE DEMAND OBLIGATIONS
The following summarizes the ratings used by Moody's for short-term notes
and variable rate demand obligations:
MIG-1/VMIG-1. Obligations bearing these designations are of the best
quality, enjoying strong protection by established cash flows, superior
liquidity support or demonstrated broad-based access to the market for
refinancing.
MIG-2/VMIG-2. Obligations bearing these designations are of high quality
with margins of protection ample although not as large as in the preceding
group.
A-4
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MIG-3/VMIG-3. Obligations bearing these designations are of favorable
quality. All security elements are accounted for but there is a lacking the
undeniable strength of the preceding grades. Liquidity and cash flow protection
may be narrow and market access for refinancing is hereby to be less well
established.
COMMERCIAL PAPER RATINGS
The rating PRIME-1 is the highest commercial paper rating assigned by
Moody's. Issuers rated PRIME-1 (or related supporting institutions) are
considered to have a superior capacity for repayment of senior short-term debt
obligations. Issuers rated PRIME-2 (or related supporting institutions) are
considered to have strong capacity for repayment of senior short-term debt
obligations. This will normally be evidenced by many of the characteristics of
issuers rated PRIME-1 but to a lesser degree. Earnings trends and coverage
ratios, while sound, will be more subject to variation. Capitalization
characteristics, while still appropriate, may be more affected by external
conditions. Ample alternate liquidity is maintained. Issuers PRIME-3 (or
supporting institutions) have an acceptable capacity rated for repayment of
senior short-term debt obligations. The effect of industry characteristics and
market composition may be more pronounced. Variability in earnings and
profitability may result in changes in the level of debt protection measurements
and may require relatively high financial leverage. Adequate alternate liquidity
is maintained. Issuers rated NOT PRIME do not fall within any of the Prime
rating categories.
A-5
<PAGE>
DOC 35039.009
PART C
OTHER INFORMATION
Item 24. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements:
(1) Included in Part A of the Registration Statement:
None.
Included in Part B of the Registration Statement:
None.
Notes to Financial Statements
(b) Exhibits: SEE NOTE #
----------
(1) (a) Articles of Incorporation of Registrant 1
(b) Articles Supplementary of Registrant. 1
(c) Articles of Amendment to Articles of
Incorporation of Registrant. 2
(d) Articles Supplementary of Registrant. 2
(e) Articles Supplementary of Registrant. 5
(f) Articles Supplementary of Registrant. 6
(g) Articles Supplementary of Registrant. 9
(h) Articles Supplementary of Registrant. 10
(i) Articles Supplementary of Registrant. 14
(j) Articles Supplementary of Registrant. 14
(k) Articles Supplementary of Registrant. 19
(l) Articles Supplementary of Registrant. 19
(m) Articles Supplementary of Registrant. 19
(n) Articles Supplementary of Registrant. 19
(o) Articles Supplementary of Registrant. 20
<PAGE>
SEE NOTE #
----------
(p) Form of Articles Supplementary
of Registrant.
(2) Amended By-Laws adopted August 16, 1988. 3
(a) Amendment to By-Laws adopted July 25, 1989. 4
(b) By-Laws amended through October 24, 1989. 5
(3) None.
(4) Specimen Certificates
a) SafeGuard Equity Growth and Income Shares 3
b) SafeGuard Fixed Income Shares 3
c) SafeGuard Balanced Shares 3
d) SafeGuard Tax-Free Shares 3
e) SafeGuard Money Market Shares 3
f) SafeGuard Tax-Free Money Market Shares 3
g) Cash Preservation Money Market Shares 3
h) Cash Preservation Tax-Free Money
Market Shares 3
i) Sansom Street Money Market Shares 3
j) Sansom Street Tax-Free Money Market Shares 3
k) Sansom Street Government Obligations Money 3
Market Shares
l) Bedford Money Market Shares 3
m) Bedford Tax-Free Money Market Shares 3
n) Bedford Government Obligations Money Market 3
Shares
o) Bedford New York Municipal Money
Market Shares 5
p) SafeGuard Government Securities Shares 5
q) Income Opportunities High Yield Bond Shares 6
r) Bradford Tax-Free Money Market Shares 8
s) Bradford Government Obligations Money Market 8
Shares
t) Alpha 1 Money Market Shares 8
u) Alpha 2 Tax-Free Money Market Shares 8
v) Alpha 3 Government Obligations Money Market 8
Shares
w) Alpha 4 New York Municipal Money Market 8
Shares
x) Beta 1 Money Market Shares 8
y) Beta 2 Tax-Free Money Market Shares 8
z) Beta 3 Government Obligations Money Market 8
Shares
aa) Beta 4 New York Municipal Money Market Shares 8
bb) Gamma 1 Money Market Shares 8
cc) Gamma 2 Tax-Free Money Market Shares 8
2
<PAGE>
SEE NOTE #
----------
dd) Gamma 3 Government Obligations Money Market 8
Shares
ee) Gamma 4 New York Municipal Money Market Shares 8
ff) Delta 1 Money Market Shares 8
gg) Delta 2 Tax-Free Money Market Shares 8
hh) Delta 3 Government Obligations Money Market 8
Shares
ii) Delta 4 New York Municipal Money
Market Shares 8
jj) Epsilon 1 Money Market Shares 8
kk) Epsilon 2 Tax-Free Money Market Shares 8
ll) Epsilon 3 Government Obligations Money
Market Shares 8
mm) Epsilon 4 New York Municipal Money
Market Shares 8
nn) Zeta 1 Money Market Shares 8
oo) Zeta 2 Tax-Free Money Market Shares 8
pp) Zeta 3 Government Obligations Money
Market Shares 8
qq) Zeta 4 New York Municipal Money Market Shares
rr) Eta 1 Money Market Shares 8
ss) Eta 2 Tax-Free Money Market Shares 8
tt) Eta 3 Government Obligations Money Market
Shares 8
uu) Eta 4 New York Municipal Money Market Shares 8
vv) Theta 1 Money Market Shares 8
ww) Theta 2 Tax-Free Money Market Shares 8
xx) Theta 3 Government Obligations Money Market
Shares 8
yy) Theta 4 New York Municipal Money Market
Shares 8
zz) BEA International Equity Shares 9
a1) BEA Strategic Fixed Income Shares 9
a2) BEA Emerging Markets Equity Shares 9
a3) Laffer/Canto Equity Shares 12
a4) BEA U.S. Core Equity Shares 13
a5) BEA U.S. Core Fixed Income Shares 13
a6) BEA Global Fixed Income Shares 13
a7) BEA Municipal Bond Shares 13
a8) BEA Balanced Shares 16
a9) BEA Short Duration Shares 16
a10) Warburg Growth & Income Shares 18
a11) Warburg Balanced Shares 18
(5) (a) Investment Advisory Agreement (Money) 3
between Registrant and Provident
Institutional Management Corporation, dated
as of August 16, 1988.
3
<PAGE>
SEE NOTE #
----------
(b) Sub-Advisory Agreement (Money) between 3
Provident Institutional Management
Corporation and Provident National Bank,
dated as of August 16, 1988.
(c) Investment Advisory Agreement 3
(Tax -Free Money) between Registrant and
Provident Institutional Management
Corporation, dated as of August 16, 1988.
(d) Sub-Advisory Agreement (Tax-Free Money) 3
between Provident Institutional Management
Corporation and Provident National Bank,
dated as of August 16, 1988.
(e) Investment Advisory Agreement 3
(Government Money) between Registrant and
Provident Institutional Management
Corporation, dated as of August 16, 1988.
(f) Sub-Advisory Agreement (Government Money) 3
between Provident Institutional Management
Corporation and Provident National Bank,
dated as of August 16, 1988.
(k) Investment Advisory Agreement (Balanced) 3
between Registrant and Provident
Institutional Management Corporation, dated
as of August 16, 1988.
(l) Sub-Advisory Agreement (Balanced) between 4
Provident Institutional Management
Corporation and Provident National Bank,
dated as of August 16, 1988.
(m) Investment Advisory Agreement (Tax-Free) 3
between Registrant and Provident
Institutional Management Corporation, dated
as of August 16, 1988.
(n) Sub-Advisory Agreement (Tax-Free) between 3
Provident Institutional Management
Corporation and Provident National Bank,
dated as of August 16, 1988.
(s) Investment Advisory Agreement 8
(Government Securities) between Registrant
and Provident Institutional Management
Corporation dated as of April 8, 1991.
4
<PAGE>
SEE NOTE #
----------
(t) Investment Advisory Agreement 8
(High Yield Bond) between Registrant
and Provident Institutional Management
Corporation dated as of April 8, 1991.
(u) Sub-Advisory Agreement (High Yield Bond) 8
between Registrant and Warburg,
Pincus Counsellors, Inc.
dated as of April 8, 1991.
(v) Investment Advisory Agreement 9
(New York Municipal Money Market) between
Registrant and Provident Institutional
Management Corporation dated
November 5, 1991.
(w) Investment Advisory Agreement (Equity) 10
between Registrant and Provident
Institutional Management Corporation
dated November 5, 1991.
(x) Sub-Advisory Agreement (Equity) between 10
Registrant, Provident Institutional
Management Corporation and Warburg,
Pincus Counsellors, Inc. dated
November 5, 1991.
(y) Investment Advisory Agreement 10
(Tax-Free Money Market) between
Registrant and Provident Institutional
Management Corporation dated
April 21, 1992.
(z) Investment Advisory Agreement 11
(BEA International Equity Portfolio)
between Registrant and BEA Associates.
(aa) Investment Advisory Agreement 11
(BEA Strategic Fixed Income Portfolio)
between Registrant and BEA Associates.
(bb) Investment Advisory Agreement 11
(BEA Emerging Markets Equity Portfolio)
between Registrant and BEA Associates.
(cc) Investment Advisory Agreement 14
(Laffer/Canto Equity Portfolio)
between Registrant and Laffer Advisors
Incorporated, dated as of July 21, 1993.
5
<PAGE>
SEE NOTE #
----------
(dd) Sub-Advisory Agreement 12
(Laffer/Canto Sector Equity Portfolio)
between PNC Institutional Management
Corporation and Laffer Advisors
Incorporated, dated as of July 21, 1993.
(ee) Investment Advisory Agreement 15
(BEA U.S. Core Equity Portfolio) between
Registrant and BEA Associates, dated as
of October 27, 1993.
(ff) Investment Advisory Agreement 15
(BEA U.S. Core Fixed Income Portfolio)
between Registrant and BEA Associates,
dated as of October 27, 1993.
(gg) Investment Advisory Agreement 15
(BEA Global Fixed Income Portfolio)
between Registrant and BEA Associates,
dated as of October 27, 1993.
(hh) Investment Advisory Agreement 15
(BEA Municipal Bond Fund Portfolio)
between Registrant and BEA Associates,
dated as of October 27, 1993.
(ii) Investment Advisory Agreement 14
(Warburg Pincus Growth and Income Fund)
between Registrant and Warburg,
Pincus Counsellors, Inc.
(jj) Investment Advisory Agreement 16
(Warburg Pincus Balanced Fund) between
Registrant and Warburg, Pincus Counsellors,
Inc.
(kk) Form of Investment Advisory Agreement 16
(BEA Balanced) between Registrant and
BEA Associates.
(ll) Form of Investment Advisory Agreement 16
(BEA Short Duration Portfolio) between
Registrant and BEA Associates.
(mm) Investment Advisory Agreement (Warburg 21
Pincus Tax Free Fund) between Registrant
and Warburg, Pincus Counsellors, Inc.
6
<PAGE>
SEE NOTE #
----------
(6) (r) Distribution Agreement and Supplements 8
(Classes A through Q) between the
Registrant and Counsellors Securities Inc.
dated as of April 10, 1991.
(s) Distribution Agreement Supplement 9
(Classes L, M, N and O) between the
Registrant and Counsellors Securities
Inc. dated as of November 5, 1991.
(t) Distribution Agreement Supplements 9
(Classes R, S, and Alpha 1 through Theta 4)
between the Registrant and Counsellors
Securities Inc. dated as of November
5, 1991.
(u) Distribution Agreement Supplement 10
(Classes T, U and V) between the Registrant
and Counsellors Securities Inc.
dated as of September 18, 1992.
(v) Distribution Agreement Supplement 14
(Class W) between the Registrant and
Counsellors Securities Inc. dated as of
July 21, 1993.
(w) Distribution Agreement Supplement 14
(Classes X, Y, Z and AA) between the
Registrant and Counselors Securities Inc.
(x) Distribution Agreement Supplement 18
(Classes BB and CC) between Registrant
and Counsellor's Securities Inc. dated
as of October 26, 1994.
(y) Distribution Agreement Supplement 18
(Classes DD and EE) between Registrant and
Counsellor's Securities Inc. dated as of
October 26, 1994.
(z) Form of Distribution Agreement Supplement 19
(Classes L, M, N and O) between the
Registrant and Counsellor's Securities
Inc.
(aa) Form of Distribution Agreement Supplement 19
(Classes R, S) between the Registrant and
Counsellor's Securities Inc.
7
<PAGE>
SEE NOTE #
----------
(bb) Distribution Agreement Supplements 19
(Classes Alpha 1 through Theta 4) between
the Registrant and Counsellor's Securities
Inc.
(cc) Distribution Agreement Supplement Janney 20
Classes (Alpha 1, Alpha 2, Alpha 3 and Alpha
4 between the Registrant and Counsellor's
Securities, Inc.
(7) Fund Office Retirement Profit-Sharing and 7
Trust Agreement, dated as of October 24, 1990.
(8) (a) Custodian Agreement between Registrant
and 3 Provident National Bank dated as of
August 16, 1988.
(b) Sub-Custodian Agreement among 10
The Chase Manhattan Bank, N.A., the
Registrant and Provident National Bank,
dated as of July 13, 1992, relating to
custody of Registrant's foreign securities.
(e) Amendment No. 1 to Custodian Agreement 9
dated August 16, 1988.
(f) Agreement between Brown Brothers Harriman 10
& Co. and Registrant on behalf of
BEA International Equity Portfolio,
dated September 18, 1992.
(g) Agreement between Brown Brothers Harriman & 10
Co. and Registrant on behalf of BEA
Strategic Fixed Income Portfolio, dated
September 18, 1992.
(h) Agreement between Brown Brothers Harriman 10
& Co. and Registrant on behalf of
BEA Emerging Markets Equity Portfolio,
dated September 18, 1992.
(i) Agreement between Brown Brothers Harriman 15
& Co. and Registrant on behalf of BEA
Emerging Markets Equity, BEA International
Equity, BEA Strategic Fixed Income and BEA
Global Fixed Income Portfolios, dated as of
November 29, 1993.
8
<PAGE>
SEE NOTE #
----------
(j) Agreement between Brown Brothers Harriman 15
& Co. and Registrant on behalf of
BEA U.S. Core Equity and BEA U.S. Core
Fixed Income Portfolio dated as of
November 29, 1993.
(k) Custodian Contract between 18
Registrant and State Street Bank and
Trust Company.
(9) (a) Transfer Agency Agreement (Sansom Street) 3
between Registrant and Provident
Financial Processing Corporation, dated as
of August 16, 1988.
(b) Transfer Agency Agreement (Cash Preservation) 3
between Registrant and Provident Financial
Processing Corporation, dated as of
August 16, 1988.
(c) Shareholder Servicing Agreement 3
(Sansom Street Money).
(d) Shareholder Servicing Agreement 3
(Sansom Street Tax-Free Money).
(e) Shareholder Servicing Agreement 3
(Sansom Street Government Money).
(f) Shareholder Services Plan 3
(Sansom Street Money).
(g) Shareholder Services Plan 3
(Sansom Street Tax-Free Money).
(h) Shareholder Services Plan 3
(Sansom Street Government Money).
(i) Transfer Agency Agreement (SafeGuard) 3
between Registrant and Provident Financial
Processing Corporation, dated as of August
16, 1988.
(j) Transfer Agency Agreement (Bedford) 3
between Registrant and Provident Financial
Processing Corporation, dated as of August
16, 1988.
9
<PAGE>
SEE NOTE #
----------
(k) Transfer Agency Agreement 7
(Income Opportunities) between Registrant
and Provident Financial Processing
Corporation dated June 25, 1990.
(l) Administration and Accounting Services 8
Agreement between Registrant and
Provident Financial Processing
Corporation, relating to Government
Securities Portfolio, dated as of
April 10, 1991.
(m) Administration and Accounting Services 9
Agreement between Registrant and Provident
Financial Processing Corporation, relating
to New York Municipal Money Market Portfolio
dated as of November 5, 1991.
(n) Administration and Accounting Services 9
Agreement between Registrant and Provident
Financial Processing Corporation, relating
to Equity Portfolio dated as of
November 5, 1991.
(o) Administration and Accounting Services 9
Agreement between Registrant and Provident
Financial Processing Corporation, relating
to High Yield Bond Portfolio, dated as of
April 10, 1991.
(p) Administration and Accounting Services 10
Agreement between Registrant and Provident
Financial Processing Corporation
(International) dated September 18, 1992.
(q) Administration and Accounting Services 10
Agreement between Registrant and Provident
Financial Processing Corporation (Strategic)
dated September 18, 1992;
(r) Administration and Accounting Services 10
Agreement between Registrant and Provident
Financial Processing Corporation (Emerging)
dated September 18, 1992.
10
<PAGE>
SEE NOTE #
----------
(s) Transfer Agency Agreement and Supplements 9
(Bradford, Alpha, Beta, Gamma, Delta,
Epsilon, Zeta, Eta and Theta) between
Registrant and Provident Financial
Processing Corporation dated as of
November 5, 1991.
(t) Transfer Agency Agreement Supplement 10
(BEA) between Registrant and Provident
Financial Processing Corporation dated as of
September 18, 1992.
(u) Administrative Services Agreement between 10
Registrant and Counsellor's Fund
Services, Inc. (BEA Portfolios)
dated September 18, 1992.
(v) Administration and Accounting Services 10
Agreement between Registrant and Provident
Financial Processing Corporation, relating
to Tax-Free Money Market Portfolio, dated
as of April 21, 1992.
(w) Transfer Agency Agreement Supplement 12
(Laffer) between Registrant and PFPC Inc.
dated as of July 21, 1993.
(x) Administration and Accounting Services 12
Agreement between Registrant and PFPC Inc.,
relating to Laffer/Canto Equity Fund, dated
July 21, 1993.
(y) Transfer Agency Agreement Supplement 15
(BEA U.S. Core Equity, BEA U.S.
Core Fixed Income, BEA Global Fixed Income
and BEA Municipal Bond Fund) between
Registrant and PFPC Inc. dated as of
October 27, 1993.
(z) Administration and Accounting Services 15
Agreement between Registrant and PFPC Inc.
relating to (Core Equity) dated as of
October 27, 1993.
(aa) Administration and Accounting Services 15
Agreement between Registrant and PFPC Inc.
(Core Fixed Income) dated
October 27, 1993.
11
<PAGE>
SEE NOTE #
----------
(bb) Administration and Accounting Services 15
Agreement between Registrant and
PFPC Inc. (International Fixed Income)
dated October 27, 1993
(cc) Administration and Accounting Services 15
Agreement between Registrant and PFPC Inc.
(Municipal Bond) dated October 27, 1993.
(dd) Transfer Agency Agreement Supplement 18
(BEA Balanced and Short Duration) between
Registrant and PFPC Inc. dated
October 26, 1994.
(ee) Administration and Accounting Services 18
Agreement between Registrant and PFPC Inc.
(BEA Balanced) dated October 26, 1994.
(ff) Administration and Accounting Services 18
Agreement between Registrant and PFPC Inc.
(BEA Short Duration) dated
October 26, 1994.
(gg) Co-Administration Agreement between 18
Registrant and PFPC Inc. (Warburg Pincus
Growth & Income Fund) dated
August 4, 1994.
(hh) Co-Administration Agreement between 18
Registrant and PFPC Inc. (Warburg Pincus
Balanced Fund) dated August 4, 1994.
(ii) Co-Administration Agreement between 18
Registrant and Counsellors Funds Services,
Inc. (Warburg Pincus Growth & Income Fund)
dated August 4, 1994.
(jj) Co-Administration Agreement between 18
Registrant and Counsellors Funds Services,
Inc. (Warburg Pincus Balanced Fund) dated
August 4, 1994.
(kk) Administrative Services Agreement Supplement 18
between Registrant and Counsellor's Fund
Services, Inc. (BEA Classes) dated
October 26, 1994.
(ll) Co-Administration Agreement between 21
Registrant and PFPC Inc. (Warburg Pincus
Tax Free Fund) dated March 31, 1995.
12
<PAGE>
SEE NOTE #
----------
(mm) Co-Administration Agreement between 21
Registrant and Counsellors Funds
Services, Inc. (Warburg Pincus Tax Free
Fund) dated March 31, 1995.
(nn) Transfer Agency and Service Agreement 21
between Registrant and State Street
Bank and Trust Company and PFPC, Inc.
dated February 1, 1995.
(oo) Supplement to Transfer Agency and Service 21
Agreement between Registrant, State Street
Bank and Trust Company, Inc. and PFPC
dated April 10, 1995.
(pp) Amended and Restated Credit Agreement dated 22
December 15, 1994
(10)(a) Opinion of Counsel.
Incorporated by reference herein to
Registrant's 24f-2 Notice for the fiscal
year ending August 31, 1995 filed on October
26, 1995.
(b) Consent of Counsel.
(11) Consent of Independent Accountants.
(12) None.
(13)(a) Subscription Agreement (relating to 2
Classes A through N).
(b) Subscription Agreement between Registrant 7
and Planco Financial Services, Inc.,
relating to Classes O and P.
(c) Subscription Agreement between Registrant and 7
Planco Financial Services, Inc., relating to
Class Q.
(d) Subscription Agreement between Registrant 9
and Counsellors Securities Inc. relating to
Classes R, S, and Alpha 1 through Theta 4.
(e) Subscription Agreement between Registrant 10
and Counsellors Securities Inc. relating to
Classes T, U and V.
13
<PAGE>
SEE NOTE #
----------
(f) Subscription Agreement between Registrant 18
and Counsellor's Securities Inc. relating to
Classes BB and CC.
(g) Purchase Agreement between Registrant and 21
Counsellors Securities Inc. relating to
Class DD (Warburg Pincus Growth & Income
Fund Series 2).
(h) Purchase Agreement between Registrant and 21
Counsellors Securities Inc. relating to
Class EE (Warburg Pincus Balanced Fund
Series 2).
(14) None.
(15)(a) Plan of Distribution (Sansom Street Money). 3
(b) Plan of Distribution (Sansom Street Tax-Free 3
Money).
(c) Plan of Distribution (Sansom Street 3
Government Money).
(d) Plan of Distribution (Cash Preservation 3
Money).
(e) Plan of Distribution (Cash Preservation 3
Tax-Free Money).
(f) Plan of Distribution (SafeGuard Equity). 3
(g) Plan of Distribution 3
(SafeGuard Fixed Income).
(h) Plan of Distribution (SafeGuard Balanced). 3
(i) Plan of Distribution (SafeGuard Tax-Free). 3
(j) Plan of Distribution (SafeGuard Money). 3
(k) Plan of Distribution (SafeGuard Tax-Free
Money). 3
(l) Plan of Distribution (Bedford Money). 3
(m) Plan of Distribution (Bedford Tax-Free 3
Money).
(n) Plan of Distribution (Bedford Government 3
Money).
14
<PAGE>
SEE NOTE #
----------
(o) Plan of Distribution (Bedford New York 7
Municipal Money).
(p) Plan of Distribution (SafeGuard Government 7
Securities).
(q) Plan of Distribution (Income Opportunities 7
High Yield).
(r) Amendment No. 1 to Plans of Distribution 8
(Classes A through Q).
(s) Plan of Distribution (Bradford Tax-Free 9
Money).
(t) Plan of Distribution (Bradford Government 9
Money).
(u) Plan of Distribution (Alpha Money). 9
(v) Plan of Distribution (Alpha Tax-Free 9
Money).
(w) Plan of Distribution (Alpha Government 9
Money).
(x) Plan of Distribution (Alpha New York 9
Money).
(y) Plan of Distribution (Beta Money). 9
(z) Plan of Distribution (Beta Tax-Free 9
Money).
(aa) Plan of Distribution (Beta Government 9
Money).
(bb) Plan of Distribution (Beta New York 9
Money).
(cc) Plan of Distribution (Gamma Money). 9
(dd) Plan of Distribution (Gamma Tax-Free 9
Money).
(ee) Plan of Distribution (Gamma Government 9
Money).
(ff) Plan of Distribution (Gamma New York 9
Money).
15
<PAGE>
SEE NOTE #
----------
(gg) Plan of Distribution (Delta Money). 9
(hh) Plan of Distribution (Delta Tax-Free 9
Money).
(ii) Plan of Distribution (Delta Government 9
Money).
(jj) Plan of Distribution (Delta New York 9
Money).
(kk) Plan of Distribution (Epsilon Money). 9
(ll) Plan of Distribution (Epsilon Tax-Free 9
Money).
(mm) Plan of Distribution (Epsilon Government 9
Money).
(nn) Plan of Distribution (Epsilon New York 9
Money).
(oo) Plan of Distribution (Zeta Money). 9
(pp) Plan of Distribution (Zeta Tax-Free 9
Money).
(qq) Plan of Distribution (Zeta Government 9
Money).
(rr) Plan of Distribution (Zeta New York 9
Money).
(ss) Plan of Distribution (Eta Money). 9
(tt) Plan of Distribution (Eta Tax-Free Money). 9
(uu) Plan of Distribution (Eta Government 9
Money).
(vv) Plan of Distribution (Eta New York 9
Money).
(ww) Plan of Distribution (Theta Money). 9
(xx) Plan of Distribution (Theta Tax-Free 9
Money).
(yy) Plan of Distribution (Theta Government 9
Money).
16
<PAGE>
SEE NOTE #
----------
(zz) Plan of Distribution (Theta New York 9
Money).
(aaa) Plan of Distribution (Laffer Equity). 12
(bbb) Plan Distribution (Warburg Pincus Growth 18
& Income Series 2).
(ccc) Plan of Distribution (Warburg Pincus 18
Balanced Series 2).
(16) Schedule of Computation of Performance 3
Quotations.
(17) None.
(18) Rule 18f-3 Plan. 21
- -----------------
NOTE #
1 Incorporated herein by reference to the same exhibit number of Registrant's
Registration Statement (No. 33-20827) filed on March 24, 1988.
2 Incorporated herein by reference to the same exhibit number of Pre-Effective
Amendment No. 2 to Registrant's Registration Statement (No. 33-20827) filed
on July 12, 1988.
3 Incorporated herein by reference to the same exhibit number of Post-Effective
Amendment No. 1 to Registrant's Registration Statement (No. 33-20827) filed
on March 23, 1989.
4 Incorporated herein by reference to the same exhibit number of Post-Effective
Amendment No. 2 to Registrant's Registration Statement (No. 33-20827) filed
on October 25, 1989.
5 Incorporated herein by reference to the same exhibit number of Post-Effective
Amendment No. 3 to the Registrant's Registration Statement (No. 33-20827)
filed on April 27, 1990.
6 Incorporated herein by reference to the same exhibit number of Post-Effective
Amendment No. 4 to the Registrant's Registration Statement (No. 33-20827)
filed on May 1, 1990.
7 Incorporated herein by reference to the same exhibit number of Post-Effective
Amendment No. 5 to the Registrant's Registration Statement (No. 33-20827)
filed on December 14, 1990.
17
<PAGE>
NOTE #
8 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 6 to the Registrant's Registration Statement
(No. 33-20827) filed on October 24, 1991.
9 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 7 to the Registrant's Registration Statement
(No. 33-20827) filed on July 15, 1992.
10 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 8 to the Registrant's Registration Statement
(No. 33-20827) filed on October 22, 1992.
11 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 9 to the Registrant's Registration Statement
(No. 33-20827) filed on December 16, 1992.
12 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 11 to the Registrant's Registrant Statement
(No. 33-20827) filed on June 21, 1993.
13 Incorporated herein by reference to the same exhibit number Post-Effective
Amendment No. 12 to the Registrant's Registration Statement (No. 33-20827)
filed on July 27, 1993.
14 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 13 to the Registrant's Registration Statement
(No. 33-20827) filed on October 29, 1993.
15 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 14 to the Registrant's Registration Statement
(No. 33-20827) filed on December 21, 1993.
16 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 19 to the Registrant's Registration Statement
(No. 33-20827) filed on October 14, 1994.
17 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 20 to the Registrant's Registration Statement
(No. 33-20827) filed on October 21, 1994.
18 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 21 to the Registrant's Registration Statement
(No. 33-20827) filed on October 28, 1994.
19 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 22 to the Registrant's Registration Statement
(No. 33-20827) filed on December 19, 1994.
18
<PAGE>
20 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 27 to the Registrant's Registration Statement
(No. 33-20827) filed on March 31, 1995.
21 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 28 to the Registrant's Registration Statement
(No. 33-20827) filed on October 6, 1995.
22 Incorporated herein by reference to the same exhibit number of
Post-Effective Amendment No. 29 to the Registrant's Registration Statement
(No. 33-20827) filed on October 25, 1995.
Item 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
None.
Item 26. NUMBER OF HOLDERS OF SECURITIES
The following information is given as of FEBRUARY 26, 1996.
TITLE OF CLASS OF COMMON STOCK NUMBER OF RECORD HOLDERS
a) Warburg Pincus Growth & INCOME 34,748
b) Warburg Pincus BALANCED 519
c) Warburg Pincus Tax-Free 155
d) RBB Money MARKET 11
e) RBB Municipal Money Market 2
f) Cash Preservation Money MARKET 36
g) Cash Preservation Municipal Money MARKET 69
h) Sansom Street Money Market 3
i) Sansom Street Municipal Money Market 0
j) Sansom Street Government Obligations 0
Money Market
k) Bedford Money MARKET 94,961
l) Bedford Municipal Money MARKET 4,984
m) Bedford Government Obligations MONEY 5,545
Market
n) Bedford New York Municipal Money MARKET 2,968
o) RBB Government SECURITIES 578
p) Bradford Municipal Money MARKET 1
q) Bradford Government Obligations MONEY 1
Market
r) BEA International EQUITY 189
s) BEA HIGH YIELD 40
t) BEA Emerging Markets EQUITY 38
u) BEA U.S. Core EQUITY 56
v) BEA U.S. Core Fixed INCOME 43
w) BEA U.S. Global Fixed Income 7
x) BEA Municipal Bond FUND 36
y) BEA Short Duration 0
z) BEA Balanced 0
19
<PAGE>
aa) Janney Montgomery Scott 1
Money Market
bb) Janney Montgomery Scott 1
Municipal Money Market
cc) Janney Montgomery Scott 1
Government Obligations Money Market
dd) Janney Montgomery Scott 1
New York Municipal Money Market
ee) Warburg Pincus Growth & Income Series 2 8
ff) Warburg Pincus Balanced Series 2 5
Item 27. INDEMNIFICATION
Sections 1, 2, 3 and 4 of Article VIII of Registrant's Articles of
Incorporation, as amended, incorporated herein by reference as Exhibits 1(a) and
1(c), provide as follows:
Section 1. To the fullest extent that limitations on the
liability of directors and officers are permitted by the Maryland
General Corporation Law, no director or officer of the Corporation
shall have any liability to the Corporation or its shareholders for
damages. This limitation on liability applies to events occurring at
the time a person serves as a director or officer of the Corporation
whether or not such person is a director or officer at the time of
any proceeding in which liability is asserted.
Section 2. The Corporation shall indemnify and advance expenses
to its currently acting and its former directors to the fullest
extent that indemnification of directors is permitted by the Maryland
General Corporation Law. The Corporation shall indemnify and advance
expenses to its officers to the same extent as its directors and to
such further extent as is consistent with law. The Board of Directors
may by By-law, resolution or agreement make further provision for
indemnification of directors, officers, employees and agents to the
fullest extent permitted by the Maryland General Corporation Law.
Section 3. No provision of this Article shall be effective to
protect or purport to protect any director or officer of the
Corporation against any liability to the Corporation or its security
holders to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in the conduct of his office.
Section 4. References to the Maryland General Corporation Law in
this Article are to the law as from time to time amended. No further
amendment to the Articles of Incorporation of the Corporation shall
decrease, but may expand, any right of any person under this Article
based on any event, omission or proceeding prior to such amendment.
Insofar as indemnification for liability arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
Registrant pursuant to the foregoing provisions, or otherwise, Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by Registrant of expenses incurred or
paid by a director, officer or controlling person of Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, Registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
Item 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
Information as to any other business, profession, vocation or
employment of a substantial nature in which any directors and officers of PIMC,
BEA, and Warburg are, or at any time during the past two (2) years have been,
engaged for their own accounts or in the capacity of director, officer,
employee, partner or trustee is incorporated herein by reference to Schedules A
and D of PIMC's Form ADV (File No. 801-13304) filed on March 28, 1993, Schedules
B and D of BEA's Form ADV (File No. 801-37170) filed on March 30, 1993, and
Schedules A and D of Warburg's Form ADV (File No. 801-07321) filed on August 28,
1992, respectively.
There is set forth below information as to any other business,
profession, vocation or employment of a substantial nature in which each
director or officer of PNC Bank, National Association (successor by merger to
Provident National Bank) ("PNC Bank"), is, or at any time during the past two
years has been, engaged for his own account or in the capacity of director,
officer, employee, partner or trustee.
PNC BANK, NATIONAL ASSOCIATION
Directors and Officers
To the knowledge of Registrant, none of the directors or officers of
PNC except those set forth below, is or has been, at any time during the past
two years, engaged in any other business, profession, vocation or employment of
a substantial nature, except that certain directors and officers of PNC Bank
also hold various positions with, and engage in business for, PNC
21
<PAGE>
Bank Corp.(formerly PNC Financial Corp), which owns all the outstanding stock of
PNC Bank, or other subsidiaries of PNC Bank Corp. Set forth below are the names
and principal businesses of the directors and certain of the senior executive
officers of PNC Bank who are engaged in any other business, profession,
vocation or employment of substantial nature.
22
<PAGE>
PNC BANK, NATIONAL ASSOCIATION
Position with
PNC Bank,
National Other Business Type of
ASSOCIATION NAME CONNECTIONS BUSINESS
- ------------ ---- -------------- --------
Director B.R. Brown President and C.E.O. of Coal
Consol, Inc.
Pittsburgh, PA (22)
Director Constance E. Clayton Superintendent of Schools Educator
The School District of
Philadelphia
Philadelphia, PA (23)
Director F. Eugene Dixon, Jr. Private Trustee Trustee
Lafayette Hill, PA (24)
Director A. James Freeman Vice Chairman and C.E.O.
Manufacturing Lord Corporation
Erie, PA (25)
Director Banking
Marine Bank
Erie, PA (26)
Director Dr. Stuart Heydt President and C.E.O. Medical
Geisinger Foundation
Danville, PA (27)
Director Edward P. Junker, III Chairman and C.E.O. Banking
Marine Bank
Erie, PA (26)
Director Thomas A. McConomy President, C.E.O. and
Manufacturing Chairman, Calgon Carbon
Corporation
Pittsburgh, PA (28)
Director Robert C. Milsom Retired
Pittsburgh, PA*
Director Thomas H. O'Brien Chairman and C.E.O. Bank Holding
PNC Bank Corp. (14)
Director Dr. J. Dennis O'Connor Chancellor Education
University of Pittsburgh
Pittsburgh, PA (29)
23
<PAGE>
Position with
PNC Bank,
National Other Business Type of
ASSOCIATION NAME CONNECTIONS BUSINESS
- ------------ ---- -------------- --------
Director Rocco A. Ortenzio Chairman and C.E.O. Medical
Continental Medical Systems,
Inc.
Mechanicsburg, PA (30)
Director Robert C. Robb, Jr. Partner Financial
Lewis, Eckert, Robb & and
Company Management
Plymouth Meeting, PA (31) Consultants
Director Daniel M. Rooney President, Pittsburgh Football
Steelers Football Club
of the National Football
League
Pittsburgh, PA (32)
Director Seth E. Schofield Chairman, President and Airline
C.E.O.
USAir Group, Inc. and
USAir, Inc.
Arlington, VA (33)
Director Robert M. Valentini President and C.E.O. Bell Communica-
of Pennsylvania and tions
Chairman Network Policy
Council of Bell
Atlantic Corporation
Philadelphia, PA (34)
President and James E. Rohr President Bank
Chief Executive PNC Bank Corp. Holding
Officer (14) Company
President and Bruce E. Robbins None.
Chief Executive
Officer of PNC
Bank, National
Association,
Pittsburgh
Senior Executive Edward V. Randall, Jr. None.
Vice President
Executive J. Richard Carnall Director Banking
Vice President PNC National Bank (2)
Chairman and Director Financial-
PFPC Inc. (3) Related
Services
24
<PAGE>
Position with
PNC Bank,
National Other Business Type of
ASSOCIATION NAME CONNECTIONS BUSINESS
- ------------ ---- -------------- --------
Director
PNC Trust Company Fiduciary
of New York (11) Activities
Director Equipment
Hayden Bolts, Inc.* Leasing
Director, Real Estate
Parkway Real Estate
Company*
Director Investment
Provident Capital Advisory
Management, Inc. (5)
Director Investment
Advanced Investment Advisory
Management, Inc. (15)
Executive Richard C. Caldwell Director Banking
Vice President PNC National Bank (2)
Director Investment
Provident Capital Advisory
Management, Inc. (5)
Director Fiduciary
PNC Trust Company Activities
of New York (11)
Executive Vice President Bank Holding
PNC Bank Corp. (14) Company
Director Investment
Advanced Investment Advisory
Management, Inc. (15)
Director Banking
PNC Bank, New Jersey,
New Jersey, National
Association (16)
Director Financial-
PFPC Inc. (3) Related
Services
Executive Vice Herbert G. None.
President Summerfield, Jr.
25
<PAGE>
Position with
PNC Bank,
National Other Business Type of
ASSOCIATION NAME CONNECTIONS BUSINESS
- ------------ ---- -------------- --------
Executive Vice Joe R. Irwin None.
President
President and Richard L. Smoot Senior Vice President Banking
Chief Executive Operations
Officer of PNC PNC Bank Corp. (20)
Bank, National
Association, Director Fiduciary
Philadelphia PNC Trust Company of Activities
New York (11)
Director Investment
PNC Institutional Advisory
Management Corporation (28)
Director Financial
PFPC Inc. (3) Related
Services
Executive Vice W. Herbert Crowder, III None.
President
Executive Vice Walter L. West None.
President
Senior Vice George Lula None.
President
Secretary William F. Strome Director International
PNC Bank International (35 Banking
Services
Managing General Counsel Bank Holding
and Senior Vice President Company
PNC Bank Corp.
Senior Vice James P. Conley None.
President/
Credit Policy
- --------------------
* For more information, contact William F. Strome, PNC Bank, National
Association, Broad and Chestnut Streets, Philadelphia, PA 19101.
(1) PNC Bank, National Association, 120 S. 17th Street, Philadelphia, PA 19103.
(2) PNC National Bank, 103 Bellevue Parkway, Wilmington, DE 19809.
(3) PFPC Inc., 400 Bellevue Parkway, Wilmington, DE 19809.
26
<PAGE>
(4) PNC Service Corp, 103 Bellevue Parkway, Wilmington, DE 19809.
(5) Provident Capital Management, Inc., 30 S. 17th Street, Site 1500,
Philadelphia, PA 19103.
(6) PNC National Investment Corporation, Broad and Chestnut Streets,
Philadelphia, PA 19101.
(7) Provident Realty Management, Inc., Broad and Chestnut Streets,
Philadelphia, PA 19101.
(8) Provident Realty, Inc., Broad and Chestnut Streets, Philadelphia, PA 19101.
(9) PNC Bancorp, Inc. 3411 Silverside Park, Wilmington, DE 19810
(10) PNC New Jersey Credit Corp, 1415 Route 70 East, Suite 604, Cherry Hill, NJ
08034.
(11) PNC Trust Company of New York, 40 Broad Street, New York, NY 10084.
(12) Provcor Properties, Inc., Broad and Chestnut Streets, Philadelphia,
PA 19101.
(13) PNC Credit Corp, 103 Bellevue Parkway, Wilmington, DE 19809.
(14) PNC Bank Corp., 5th Avenue and Wood Streets, Pittsburgh, PA 15265.
(15) Advanced Investment Management, Inc., 27th Floor, One Oliver Plaza,
Pittsburgh, PA 15265.
(16) PNC Bank of New Jersey, National Association, Woodland Falls Corporate
Park, 210 Lake Drive East, Cherry Hill, NJ 08002.
(17) PNC Institutional Management Corporation, 400 Bellevue Parkway,
Wilmington, DE 19809.
(18) Provident National Leasing Corporation, Broad and Chestnut Streets,
Philadelphia, PA 19101
(19) Provident National Bank Corp. New Jersey, 1 Centennial Square,
Haddonfield, NJ 08033
(20) The Clayton Bank and Trust Company, Clayton, DE 19938
(21) Keystone Life Insurance Company, 1207 Chestnut Street, Philadelphia, PA
19107-4101
(22) Consol, Inc., Consol Plaza, Pittsburgh, PA 15241
(23) School District of Philadelphia, 21 Street and The Parkway, Philadelphia,
PA 19103-1099
(24) F. Eugene Dixon, Jr., Private Trustee, 665 Thomas Road, Lafayette Hill,
PA 19444-0178
(25) Lord Corporation, 2000 W. Grandview Boulevard, Erie, PA 16514
(26) Marine Bank, Ninth and State Streets, Erie, PA 16553
(27) Geisinger Foundation, 100 N. Academy Avenue, Danville, PA 17822
(28) Calgon Carbon Corporation, P.O. Box 717, Pittsburgh, PA 15230-0717
(29) University of Pittsburgh, 107 Cathedral of Learning, Pittsburgh, PA 15260
(30) Continental Medical Systems, Inc., P.O. Box 715, Mechanicsburg, PA 17055
(31) Lewis, Eckert, Robb & Company, 425 One Plymouth Meeting, Plymouth Meeting,
PA 19462
(32) Football Club of the National Football League, 300 Stadium Circle,
Pittsburgh, PA 15212
(33) USAir Group, Inc. and USAir, Inc., 2345 Crystal Drive, Arlington,
VA 22227
(34) Bell of Pennsylvania, One Parkway, Philadelphia, PA 19102
(35) PNC Bank International, 5th and Wood Streets, Pittsburgh, PA 15222
27
<PAGE>
Item 29. PRINCIPAL UNDERWRITER
(a) Counsellors Securities Inc. (the "Distributor") acts as distributor for
the following investment companies:
Warburg, Pincus Cash Reserve Fund
Warburg, Pincus New York Tax Exempt Fund
Warburg, Pincus New York Municipal Bond Fund
Warburg, Pincus Intermediate Maturity Government Fund
Warburg, Pincus Fixed Income Fund
Warburg, Pincus Global Fixed Income Fund
Warburg, Pincus Capital Appreciation Fund
Warburg, Pincus Emerging Growth Fund
Warburg, Pincus International Equity Fund
Warburg, Pincus Japan OTC Fund
Counsellors Tandem Securities Fund
Warburg Pincus Growth & Income Fund
Warburg Pincus Balanced Fund
Warburg Pincus Tax Free Fund
The Distributor acts as a principal underwriter, depositor or investment adviser
for the following investment companies: None other than Registrant and companies
listed above.
(b) Information for each director or officer of the Distributor is set
forth below:
Name and Principal Positions and Offices Positions and Offices
BUSINESS ADDRESS WITH THE DISTRIBUTOR WITH REGISTRANT
- ------------------ -------------------- ---------------------
John L. Vogelstein Director
466 Lexington Avenue
New York, New York 10017
Lionel I. Pincus Director
466 Lexington Avenue
New York, New York 10017
Reuben S. Leibowitz Director,
466 Lexington Avenue President and Chief
New York, New York 10017 Financial Officer
John L. Furth Director
466 Lexington Avenue
New York, New York 10017
Arnold M. Reichman Vice President, Director
466 Lexington Avenue Secretary and
New York, New York 10017 Chief Operating Officer
28
<PAGE>
Roger Reinlieb Vice President
466 Lexington Avenue
New York, New York 10017
Karen Amato Assistant Secretary
466 Lexington Avenue
New York, New York 10017
Stephen Distler Treasurer
466 Lexington Avenue
New York, New York 10017
(c) Information as to commissions and other compensation received by the
principal underwriter is set forth below.
Net
Name of Underwriting Compensation
Principal Discounts and on Redemption Brokerage Other
UNDERWRITER COMMISSIONS AND REPURCHASE COMMISSIONS COMPENSATION
- ----------- ------------- -------------- ----------- ------------
Counsellors $ 0 $ 0 $ 0 $ 0
Securities
Inc.
Item 30. LOCATION OF ACCOUNTS AND RECORDS
(1) PNC Bank, National Association (successor by merger to Provident
National Bank), Broad and Chestnut Street, Philadelphia, PA 19101
(records relating to its functions as sub-adviser and custodian).
(2) Counsellors Securities Inc., 466 Lexington Avenue, New York, New York
10017 (records relating to its functions as distributor).
(3) PNC Institutional Management Corporation (formerly Provident
Institutional Management Corporation), Bellevue Corporate Center,
103 Bellevue Parkway, Wilmington, Delaware 19809 (records relating to
its functions as investment adviser, sub-adviser and administrator).
(4) PFPC Inc. (formerly Provident Financial Processing Corporation),
Bellevue Corporate Center, 400 Bellevue Parkway, Wilmington,
Delaware 19809 (records relating to its functions as transfer agent
and dividend disbursing agent).
(5) Ballard Spahr Andrews & Ingersoll, 1735 Market Street - 51st Floor,
Philadelphia, Pennsylvania 19103 (Registrant's Articles of
Incorporation, By-Laws and Minute Books).
29
<PAGE>
(6) BEA Associates, One Citicorp Center, 153 East 53rd Street, New York,
New York 10022 (records relating to its function as investment
adviser).
(7) Warburg, Pincus Counsellors, Inc., 466 Lexington Avenue, New York,
New York 10017-3147 (records relating to its functions as
investment adviser).
Item 31. MANAGEMENT SERVICES
None.
Item 32. UNDERTAKINGS
(a) Registrant hereby undertakes to hold a meeting of shareholders for the
purpose of considering the removal of directors in the event the
requisite number of shareholders so request.
30
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant has duly caused this Post-Effective
Amendment to its Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Wilmington, and State of
Delaware, on February 29, 1996.
THE RBB FUND, INC.
By: /S/ EDWARD J. ROACH
---------------------
Edward J. Roach
President and
Treasurer
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment to Registrant's Registration Statement has been signed
below by the following persons in the capacities and on the date indicated.
SIGNATURE TITLE DATE
/S/ EDWARD J. ROACH President (Principal FEBRUARY 29, 1996
- ----------------------
Edward J. Roach Executive Officer) and
Treasurer (Principal
Financial and Accounting
Officer)
/S/ DONALD VAN RODEN Director FEBRUARY 29, 1996
- -----------------------
Donald van Roden
/S/ FRANCIS J. MCKAY Director FEBRUARY 29, 1996
- -----------------------
Francis J. McKay
/S/ MARVIN E. STERNBERG Director FEBRUARY 29, 1996
- -----------------------
Marvin E. Sternberg
/S/ JULIAN A. BRODSKY Director FEBRUARY 29, 1996
- -----------------------
Julian A. Brodsky
/S/ ARNOLD M. REICHMAN Director FEBRUARY 26, 1996
- -----------------------
Arnold M. Reichman
/S/ ROBERT SABLOWSKY Director FEBRUARY 23, 1996
- -----------------------
Robert Sablowsky
<PAGE>
THE RBB FUND, INC.
RBB CLASSES
WARBURG PINCUS CLASSES
WARBURG PINCUS SERIES 2 CLASSES
CASH PRESERVATION CLASSES
SANSOM STREET CLASSES
BEDFORD CLASSES
BRADFORD CLASSES
BEA CLASSES
JANNEY (ALPHA) CLASSES
NUMERIC CLASSES
BETA CLASSES
GAMMA CLASSES
DELTA CLASSES
EPSILON CLASSES
ZETA CLASSES
ETA CLASSES
THETA CLASSES
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT PAGE SEE NOTE #
<C> <S> <C> <C>
99.B(1)(p) Form of Articles of Supplementary of Registrant
99.B(10)(b) Consent of Counsel
99.B(11) Consent of Independent Accountants
</TABLE>
Exhibit 99.B(1)(p)
195852.001(BF)
THE RBB FUND, INC.
ARTICLES SUPPLEMENTARY TO THE
CHARTER
THE RBB FUND, INC., a Maryland corporation having its principal office in
Baltimore, Maryland (hereinafter called the "Corporation"), hereby certifies to
the State Department of Assessments and Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation, an open-end investment
company registered under the Investment Company Act of 1940, as amended, and
having authorized capital of thirty billion (30,000,000,000) shares of common
stock, par value $.001 per share, has adopted a unanimous resolution increasing
the number of shares of common stock that are classified (but not increasing the
aggregate number of authorized shares) into separate classes by:
classifying an additional fifty million (50,000,000) of the previously
authorized, unissued and unclassified shares of the common stock, par value
$.001 per share, with an aggregate par value of fifty thousand dollars
($50,000), as Class FF Common Stock (Numeric Micro Cap Fund);
classifying an additional fifty million (50,000,000) of the previously
authorized, unissued and unclassified shares of the common stock, par value
$.001 per share, with an aggregate par value of fifty thousand dollars
($50,000), as Class GG Common Stock (Numeric Growth Fund);
classifying an additional fifty million (50,000,000) of the previously
authorized, unissued and unclassified shares of the common stock, par value
$.001 per share, with an aggregate par value of fifty thousand dollars
($50,000), as Class HH Common Stock (Numeric Larger Cap Fund);
SECOND: A description of the shares so classified with the preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of redemption as set or
changed by the Board of Directors of the Corporation is as follows:
A description of the preferences, conversion and other rights, voting
powers, restrictions, limitations as to dividends, qualifications and terms and
conditions or redemption of each class of common stock of the Corporation is set
forth in Article VI, Section (6) of the Corporation's Charter, and has not been
changed by the Board of Directors of the Corporation.
THIRD: The shares aforesaid have been duly classified by the Board of
Directors of the Corporation pursuant to authority and power contained in the
charter of the Corporation.
2
<PAGE>
FOURTH: Immediately before the increase in the number of shares of common
stock that have been classified into separate classes:
(a) the Corporation had authority to issue thirty billion (30,000,000,000)
shares of its common stock and the aggregate par value of all the shares of all
classes was thirty million dollars ($30,000,000);
(b) the number of shares of each authorized class of common stock was as
follows:
Class A - one hundred million (100,000,000), par value $.001 per share;
Class B - one hundred million (100,000,000), par value $.001 per share;
Class C - one hundred million (100,000,000), par value $.001 per share;
Class D - one hundred million (100,000,000), par value $.001 per share;
Class E - five hundred million (500,000,000), par value $.001 per share;
Class F - five hundred million (500,000,000), par value $.001 per share;
Class G - five hundred million (500,000,000), par value $.001 per share;
Class H - five hundred million (500,000,000), par value $.001 per share;
Class I - one billion (1,000,000,000), par value $.001 per share;
Class J - five hundred million (500,000,000), par value $.001 per share;
Class K - five hundred million (500,000,000), par value $.001 per share;
Class L - one billion five hundred million (1,500,000,000), par value $.001
per share;
Class M - five hundred million (500,000,000), par value $.001 per share;
Class N - five hundred million (500,000,000), par value $.001 per share;
3
<PAGE>
Class O - five hundred million (500,000,000), par value $.001 per share;
Class P - one hundred million (100,000,000), par value $.001 per share;
Class Q - one hundred million (100,000,000), par value $.001 per share;
Class R - five hundred million (500,000,000), par value $.001 per share;
Class S - five hundred million (500,000,000), par value $.001 per share;
Class T - five hundred million (500,000,000), par value $.001 per share;
Class U - five hundred million (500,000,000), par value $.001 per share;
Class V - five hundred million (500,000,000), par value $.01 per share;
Class W - one hundred million (100,000,000), par value $.001 per share;
Class X - fifty million (50,000,000), par value $.001 per share;
Class Y - fifty million (50,000,000), par value $.001 per share;
Class Z - fifty million (50,000,000), par value $.001 per share;
Class AA - fifty million (50,000,000), par value $.001 per share;
Class BB - fifty million (50,000,000), par value $.001 per share;
Class CC - fifty million (50,000,000), par value $.001 per share;
Class DD - one hundred million (100,000,000), par value $.001 per share;
Class EE - one hundred million (100,000,000), par value $.001 per share;
Class Alpha 1 - seven hundred million (700,000,000), par value $.001 per share;
Class Alpha 2 - two hundred million (200,000,000), par value $.001 per share;
Class Alpha 3 - five hundred million (500,000,000), par value $.001 per share;
Class Alpha 4 - one hundred million (100,000,000), par value $.001 per share;
4
<PAGE>
Class Beta 1 - one million (1,000,000), par value $.001 per share;
Class Beta 2 - one million (1,000,000), par value $.001 per share;
Class Beta 3 - one million (1,000,000), par value $.001 per share;
Class Beta 4 - one million (1,000,000), par value $.001 per share;
Class Gamma 1 - one million (1,000,000), par value $.001 per share;
Class Gamma 2 - one million (1,000,000), par value $.001 per share;
Class Gamma 3 - one million (1,000,000), par value $.001 per share;
Class Gamma 4 - one million (1,000,000), par value $.001 per share;
Class Delta 1 - one million (1,000,000), par value $.001 per share;
Class Delta 2 - one million (1,000,000), par value $.001 per share;
Class Delta 3 - one million (1,000,000), par value $.001 per share;
Class Delta 4 - one million (1,000,000), par value $.001 per share;
Class Epsilon 1 - five hundred million (1,000,000), par value $.001 per share;
Class Epsilon 2 - one million (1,000,000), par value $.001 per share;
Class Epsilon 3 - one million (1,000,000), par value $.001 per share;
Class Epsilon 4 - one million (1,000,000), par value $.001 per share;
Class Zeta 1 - one million (1,000,000), par value $.001 per share;
Class Zeta 2 - one million (1,000,000), par value $.001 per share;
Class Zeta 3 - one million (1,000,000), par value $.001 per share;
Class Zeta 4 - one hundred million (1,000,000), par value $.001 per share;
Class Eta 1 - one million (1,000,000), par value $.001 per share;
5
<PAGE>
Class Eta 2 - one million (1,000,000) par value $.001 per share;
Class Eta 3 - one million (1,000,000), par value $.001 per share;
Class Eta 4 - one million (1,000,000), par value $.001 per share;
Class Theta 1 - one million (1,000,000), par value $.001 per share;
Class Theta 2 - one million (1,000,000), par value $.001 per share;
Class Theta 3 - one million (1,000,000), par value $.001 per share; and
Class Theta 4 - one million (1,000,000), par value $.001 per share,
for a total of twelve billion two hundred twenty-eight million (12,228,000,000)
shares classified into separate classes of common stock.
After the increase in the number of shares of common stock that have been
classified into separate classes:
(c) the Corporation has the authority to issue thirty billion
(30,000,000,000) shares of its common stock and the aggregate par value of all
the shares of all classes is now thirty million dollars ($30,000,000); and
(d) the number of authorized shares of each class is now as follows:
Class A - one hundred million (100,000,000), par value $.001 per share;
Class B - one hundred million (100,000,000), par value $.001 per share;
Class C - one hundred million (100,000,000), par value $.001 per share;
Class D - one hundred million (100,000,000), par value $.001 per share;
Class E - five hundred million (500,000,000), par value $.001 per share;
Class F - five hundred million (500,000,000), par value $.001 per share;
6
<PAGE>
Class G - five hundred million (500,000,000), par value $.001 per share;
Class H - five hundred million (500,000,000), par value $.001 per share;
Class I - one billion (1,000,000,000), par value $.001 per share;
Class J - five hundred million (500,000,000), par value $.001 per share;
Class K - five hundred million (500,000,000), par value $.001 per share;
Class L - one billion five hundred million (1,500,000,000), par value
$.001 per share;
Class M - five hundred million (500,000,000), par value $.001 per share;
Class N - five hundred million (500,000,000), par value $.001 per share;
Class O - five hundred million (500,000,000), par value $.001 per share;
Class P - one hundred million (100,000,000), par value $.001 per share;
Class Q - one hundred million (100,000,000), par value $.001 per share;
Class R - five hundred million (500,000,000), par value $.001 per share;
Class S - five hundred million (500,000,000), par value $.001 per share;
Class T - five hundred million (500,000,000), par value $.001 per share;
Class U - five hundred million (500,000,000), par value $.001 per share;
Class V - five hundred million (500,000,000), par value $.001 per share;
Class W - one hundred million (100,000,000), par value $.001 per share;
Class X - fifty million (50,000,000), par value $.001 per share;
Class Y - fifty million (50,000,000), par value $.001 per share;
Class Z - fifty million (50,000,000), par value $.001 per share;
Class AA - fifty million (50,000,000), par value $.001 per share;
7
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Class BB - fifty million (50,000,000), par value $.001 per share;
Class CC - fifty million (50,000,000), par value $.001 per share;
Class DD - one hundred million (100,000,000), par value $.001 per share;
Class EE - one hundred million (100,000,000), par value $.001 per share;
Class FF - fifty million (50,000,000), par value $.001 per share;
Class GG - fifty million (50,000,000), par value $.001 per share;
Class HH - fifty million (50,000,000), par value $.001 per share;
Class Alpha 1 - seven hundred million (700,000,000), par value $.001 per share;
Class Alpha 2 - two hundred million (200,000,000), par value $.001 per share;
Class Alpha 3 - five hundred million (500,000,000), par value $.001 per share;
Class Alpha 4 - one hundred million (100,000,000), par value $.001 per share;
Class Beta 1 - one million (1,000,000), par value $.001 per share;
Class Beta 2 - one million (1,000,000), par value $.001 per share;
Class Beta 3 - one million (1,000,000), par value $.001 per share;
Class Beta 4 - one million (1,000,000), par value $.001 per share;
Class Gamma 1 - one million (1,000,000), par value $.001 per share;
Class Gamma 2 - one million (1,000,000), par value $.001 per share;
Class Gamma 3 - one million (1,000,000), par value $.001 per share;
Class Gamma 4 - one million (1,000,000), par value $.001 per share;
Class Delta 1 - one million (1,000,000), par value $.001 per share;
Class Delta 2 - one million (1,000,000), par value $.001 per share;
8
<PAGE>
Class Delta 3 - one million (1,000,000), par value $.001 per share;
Class Delta 4 - one million (1,000,000), par value $.001 per share;
Class Epsilon 1 - one million (1,000,000), par value $.001 per share;
Class Epsilon 2 - one million (1,000,000), par value $.001 per share;
Class Epsilon 3 - one million (1,000,000), par value $.001 per share;
Class Epsilon 4 - one million (1,000,000), par value $.001 per share;
Class Zeta 1 - one million (1,000,000), par value $.001 per share;
Class Zeta 2 - one million (1,000,000), par value $.001 per share;
Class Zeta 3 - one million (1,000,000), par value $.001 per share;
Class Zeta 4 - one million (1,000,000), par value $.001 per share;
Class Eta 1 - one million (1,000,000), par value $.001 per share;
Class Eta 2 - one million (1,000,000) par value $.001 per share;
Class Eta 3 - one million (1,000,000), par value $.001 per share;
Class Eta 4 - one million (1,000,000), par value $.001 per share;
Class Theta 1 - one million (1,000,000), par value $.001 per share;
Class Theta 2 - one million (1,000,000), par value $.001 per share;
Class Theta 3 - one million (1,000,000), par value $.001 per share;
Class Theta 4 - one million (1,000,000), par value $.001 per share;
for a total of twelve billion three hundred seventy-eight million
(12,378,000,000) shares classified into separate classes of common stock.
9
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IN WITNESS WHEREOF, The RBB Fund, Inc. has caused these presents to be
signed and attested in its name and on its behalf by its President and Secretary
on __________, 1996.
ATTEST: THE RBB FUND, INC.
By:
- ----------------------------- ----------------------------------
Morgan R. Jones Edward J. Roach
Secretary President
10
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THE UNDERSIGNED, President of The RBB Fund, Inc., who executed on behalf of
said corporation the foregoing Articles Supplementary to the Charter, of which
this certificate is made a part, hereby acknowledges, in the name and on behalf
of said Corporation, and further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein with respect to
the approval thereof are true in all material respects, under the penalties of
perjury.
-----------------------------------------
Edward J. Roach
President
11
Exhibit 99.B(10)(b)
197686.001(B&F)
CONSENT
We hereby consent to the use of our name under the caption
"Miscellaneous-Counsel" in the Statement of Additional Information of
Post-Effective Amendment No. 33 to the Registration Statement on Form N-1A of
The RBB Fund, Inc. (Registration No. 33-20827) filed under the Securities Act of
1933 and Amendment No. 35 under the Investment Company Act of 1940.
/S/ BALLARD SPAHR ANDREWS & INGERSOLL
---------------------------------
Ballard Spahr Andrews & Ingersoll
March 4, 1996
Exhibit 99.B(11)
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent in this Post-Effective Amendment No. 33 under the Securities Act
of 1933, as amended to this Registration Statement on Form N-1A (File No.
33-20827) of The RBB Fund, Inc. to the reference to our Firm under the headings
"Independent Accountants" in the Prospectus and "Miscellaneous-Independent
Accountants" in the Statement of Additional Information.
/s/COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
2400 Eleven Penn Center
Philadelphia, Pennsylvania
March 5, 1996
