<PAGE>
As filed with the Securities and Exchange Commission on September 30, 1999
Securities Act File No. 33-20827
Investment Company Act File No. 811-5518
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. -- [_]
Post-Effective Amendment No. 67 [X]
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 69 [X]
------------------
THE RBB FUND, INC.
(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
GARY M. GARDNER, ESQUIRE Copies to:
PFPC, Inc. Michael P. Malloy, Esquire
400 Bellevue Parkway Drinker Biddle & Reath LLP
Wilmington, DE 19809 One Logan Square
(Name and Address of Agent for Service) 18th & Cherry Streets
Philadelphia, PA 19103-6996
It is proposed that this filing will become effective (check appropriate
box)
[_] immediately upon filin pursuant to paragraph (b)
[_] on (date) pursuant to paragraph (b)
[_] 60 days after filing pursuant to paragraph (a)(1)
[X] on December 1, 1999 pursuant to paragraph (a)(1)
[_] 75 days after filing pursuant to paragraph (a)(2)
[_] on (date) pursuant to paragraph (a)(2) of Rule 485
If appropriate, check the following box:
[_] This post-effective amendment designates a new effective date
for a previously filed post-effective amendment.
The purpose of this Post-Effective Amendment is to update certain
information in the Registrant's Prospectuses and Statements of Additional
Information, including requirements relating to amended Form N-1A and provisions
of Rule 421 with respect to plain English principles, relating to Registrant's
n/i numeric investors Micro Cap Fund, n/i numeric investors Growth Fund, n/i
numeric investors Mid Cap Fund, n/i numeric investors Larger Cap Value
Fund and n/i numeric investors Small Cap Value Fund.
Title of Securities..................Shares of Common Stock
<PAGE>
n/i numeric investors
family of funds
n/i numeric investors Micro Cap Fund
n/i numeric investors Growth Fund
n/i numeric investors Mid Cap Fund
n/i numeric investors Larger Cap Value Fund
n/i numeric investors Small Cap Value Fund
___________________________________
advised by numeric investors lp(R)
___________________________________
The securities described in this prospectus have been registered with the
Securities and Exchange Commission (SEC). The SEC, however, has not judged these
securities for their investment merit and has not determined the accuracy or
adequacy of this prospectus. Anyone who tells you otherwise is committing a
criminal offense.
PROSPECTUS
DECEMBER 1, 1999
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
=========================================================================================================
INTRODUCTION TO RISK / RETURN SUMMARY
=============================================================================
<S> <C> <C>
Who Should Invest........................................... 3
Numeric's Investment Style.................................. 3
=============================================================================
DESCRIPTIONS OF THE FUNDS
=============================================================================
A look at the goals, n/i numeric investors Micro Cap Fund........................ 5
strategies, risks, n/i numeric investors Growth Fund........................... 8
expenses and financial n/i numeric investors Mid Cap Fund.......................... 11
history of each Fund. n/i numeric investors Larger Cap Value Fund................. 14
n/i numeric investors Small Cap Value Fund.................. 17
=============================================================================
MANAGEMENT
=============================================================================
Details on the management Investment Adviser.......................................... 20
and operations of the Service Provider Chart...................................... 21
Funds.
=============================================================================
SHAREHOLDER INFORMATION
=============================================================================
Policies and instructions Pricing of Fund Shares...................................... 22
for opening, maintaining Purchase of Fund Shares..................................... 22
and closing an account in Redemption of Fund Shares................................... 24
any of the Funds. Exchange Privilege.......................................... 26
Dividends and Distributions................................. 26
Taxes....................................................... 27
=============================================================================
FINANCIAL HIGHLIGHTS............................................. 28
=============================================================================
FOR MORE INFORMATION................................. See back cover
=========================================================================================================
</TABLE>
-2-
<PAGE>
INTRODUCTION TO RISK / RETURN SUMMARY
This Prospectus has been written to provide you with the information you need to
make an informed decision about whether to invest in the n/i numeric investors
family of funds of The RBB Fund, Inc. (the "Company").
The five classes of common stock of the Company represent interest in the n/i
numeric investors Micro Cap Fund, n/i numeric investors Growth Fund, n/i numeric
investors Mid Cap Fund, n/i numeric investors Larger Cap Value Fund and n/i
numeric investors Small Cap Value Fund. This Prospectus and the Statement of
Additional Information incorporated herein relate solely to the n/i numeric
investors family of funds of the Company.
This Prospectus has been organized so that each Fund has its own short section
with important facts about that particular Fund. After you read this
introduction and the short sections about Fund strategies and risks, read the
sections about Purchase and Redemption of Fund Shares, which apply to all the
Funds offered by this Prospectus.
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. 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. 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 also
wish to complement an investment in the Funds with other types of common stock
investments.
General Considerations for Taxable Investors. High portfolio turnover (100% or
more) can adversely affect taxable investors, especially those in higher
marginal tax brackets, in two ways. First, short-term capital gains, which are a
by-product of high turnover investment strategies, are currently taxed at rates
comparable to ordinary income rates. Ordinary income tax rates are higher than
long-term capital gain tax rates for middle and upper income taxpayers. Second,
the frequent realization of gains, which causes taxes to be paid frequently, is
less advantageous than infrequent realization of gains. Infrequent realization
of gains allows the payment of taxes to be deferred to later years, allowing
more of the gains to compound before taxes are paid. Consequently after-tax
compound rates of return will generally be higher for taxable investors using
investment strategies with very low turnover, all else being equal.
Investors should consider their ability to allocate tax-deferred (such as IRAs
and 401(k) plans) versus taxable assets when considering where to invest.
Numeric's Investment Style
Quantitative Approach. To meet each Fund's investment objective, Numeric
Investors L.P. ("Numeric"), the Funds' investment adviser, uses quantitative
investment techniques. These quantitative techniques rely on two proprietary
computer models developed by Numeric to aid in the stock selection process.
Currently, Numeric classifies their models into two types:
. the Value Stock Model -- This model attempts to find companies for purchase
or sale whose stocks are determined to be mispriced relative to their
projected earnings, growth and quality. In searching
-3-
<PAGE>
for stocks with market valuations lower than the average market valuation of
stocks, this model considers, among other characteristics, price to earnings
ratios and price to book ratios. The Value Stock Model is the primary model
used in the management of the n/i numeric investors Larger Cap Value and n/i
numeric investors Small Cap Value Funds. This model is given equal
consideration in the management of the n/i numeric investors Mid Cap Fund
along with the Growth Stock Model (described below).
. the Growth Stock Model or EstrendTM Model -- This model attempts to find
companies for purchase or sale whose earnings are improving more rapidly than
the earnings of the average company. It also measures recent changes in Wall
Street analysts' earnings forecasts for each company, selecting for purchase
companies judged likely to experience upward revisions in earnings estimates,
and for sale companies thought likely to suffer downward revisions. The
Growth Stock Model is the primary model used in the management of the n/i
numeric investors Micro Cap and n/i numeric investors Growth Funds. This
model is given equal consideration in the management of the n/i numeric
investors Mid Cap Fund along with the Value Stock Model (described above).
The Value Stock Model and Growth Stock Model are intentionally complementary to
each other. The insights they provide about each stock are from different
perspectives and each model tends to be more effective during periods when the
other is less effective. Combined, they generate more consistent excess returns.
Numeric's models incorporate dozens of characteristics for the more than 2,000
companies analyzed, rapidly incorporating new market information during each
trading day. The Funds' portfolio managers closely monitor this flow of
information to identify the most immediate investment opportunities.
Capital Limitation. Numeric pursues an unusual business strategy for an
investment manager in that it strictly limits the amount of capital that it
accepts into a Fund. It is Numeric's belief that as a pool of assets in any one
strategy grows larger, the transaction costs associated with buying and selling
securities for the strategy correspondingly increases. Numeric believes that
too large a pool of capital in any one strategy will inevitably reduce its
ability to achieve investment results that meet its objectives
As a result, each of the Funds will close to further investment when increasing
transaction costs begin to diminish the fund's performance. Currently, Numeric
intends to close the n/i numeric investors Micro Cap and n/i numeric investors
Growth Funds to new investors when total assets reach $125 million, the n/i
numeric investors Mid Cap and n/i numeric investors Small Cap Funds, at $200
million, and the n/i numeric investors Larger Cap Value Fund at $400-500 million
in total assets.
-4-
<PAGE>
n/i numeric investors MICRO CAP FUND
Ticker Symbol: NIMCX
Investment Goal
The Fund's investment goal is to provide long-term capital appreciation.
Primary Investment Strategies
Under normal circumstances, the Fund invests at least 65% of its total assets in
common stock of companies with a market capitalization of $600 million or less,
although the Fund may invest in companies with higher market capitalization.
Numeric determines its stock selection decisions for this Fund primarily on the
basis of its Growth Stock Model. Considered, but of significantly less
importance, is the Value Stock Model.
The Fund may use futures to reduce risk to the Fund as a whole (hedge); they may
also be used to maintain liquidity, commit cash pending investment or increase
returns.
The Fund may lend its portfolio securities to financial institutions. The Fund
will receive collateral in cash or high quality securities equal to the current
value of the loaned securities. These loans will be limited to 33 1/3% of the
value of the Fund's total assets.
The Fund may borrow money for temporary or emergency (not leveraging) purposes.
The Fund will not make any additional investments while borrowings exceed 5% of
its total assets.
Numeric may close the Fund to new investors if they believe a large increase in
the size of the Fund would adversely affect their investment strategy.
Accordingly, if the Fund's total assets exceed $125 million, Numeric will close
the Fund to new investors. (See Closing of Funds under Purchase of Fund
Shares.)
The Company's Board of Directors can change the investment objective of the
Fund. However, shareholders will be given 30 days notice before any change is
made.
Key Risks
. Common stocks may decline over short or even extended periods of time. Equity
markets tend to be cyclical; there are times when stock prices generally
increase, and other times when they generally decrease. Therefore, you could
lose money by investing in the Fund.
. The net asset value of the Fund will change with changes in the market value
of its portfolio positions.
. Investments in micro-cap companies involve greater risk than is customarily
associated with larger more established companies due to the greater business
risks of small size, limited markets, and financial resources, narrow product
lines and frequent lack of depth of management.
. The securities of smaller-sized companies may be subject to more abrupt or
erratic market movements than securities of larger more established
companies.
. The Fund's micro-cap securities may underperform small-cap, mid-cap or large-
cap securities, or the equity markets as a whole when they are out of favor.
. The Fund's use of futures may reduce returns and/or increase volatility.
Volatility is defined as the characteristic of a security or a market to
fluctuate significantly in price within a short time period.
-5-
<PAGE>
. Lending the Fund's portfolio securities involves the risk of a delay in
additional collateral if the value of the securities goes up while they are
on loan. There is also the risk of delay in recovering the loaned securities
and of losing rights to the collateral if the borrower goes bankrupt.
Portfolio Turnover -- The more often stocks are traded, the more the Fund will
be charged brokerage commissions and other transaction costs that lower
performance. In addition to higher transaction costs, high portfolio turnover
(generally considered over 100%) could result in the realization of taxable
capital gains.
Year 2000 -- The Fund, like any business, could be affected if the computer
systems on which it relies do not properly process information beginning on
January 1, 2000. While Year 2000 issues could have a negative effect on the
Fund, Numeric is currently working to avoid such problems. The Company is also
working with other systems providers and vendors to determine their systems'
ability to handle Year 2000 problems. There is no guarantee, however, that
systems will work properly on or after January 1, 2000. Year 2000 problems may
also hurt issuers whose securities the Fund holds or securities markets
generally.
Risk/Return Information
The chart and table below give you a picture of the Fund's long-term
performance. The information shows you how the Fund's performance has varied
year by year and provides some indication of the risks of investing in the Fund.
The chart and table below both assume reinvestment of dividends and
distributions. As with all such investments, past performance is not an
indication of future results. Performance reflects fee waivers in effect. If
fee waivers were not in place, the Fund's performance would be reduced.
As of 12/31
Annual Total Returns
[BAR CHART APPEARS HERE]
1996 1997 1998
---- ---- ----
16.85% 30.86% 16.27%
Year to date total return for the nine months ended September 30, 1999: ___%
Best Quarter: 32.95% (quarter ended 10/31/97)
Worst Quarter: 9.92% (quarter ended 9/30/96)
-6-
<PAGE>
As of 12/31/98
Average Annual Total Returns - Comparison
1 Year Since Inception
------ ---------------
n/i numeric investors Micro Cap Fund* 16.27% 24.98%
Russell 2000 Growth Index** ___% ___%
* Commenced operations on June 3, 1996.
** The Russell 2000 is an index of stocks 1001 through 3000 in the Russell
3000 Index as ranked by total market capitalization. This index is
segmented into growth and value categories. The Russell 2000 Growth Index
contains stocks from the Russell 2000 with greater-than- average growth
orientation. Companies in this index generally have higher price-to-book
and price/earnings ratios.
Expenses and Fees
As a shareholder you pay certain fees and expenses. Annual Fund operating
expenses are paid out of Fund assets and are reflected in the Fund's price.
The table below describes the fees and expenses that you may pay if you buy and
hold shares of the Fund. The table is based on expenses for the most recent
fiscal year.
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)
Management fees[+].................................... 0.75%
Rule 12b-1 fees....................................... None
Other expenses........................................ 0.48%
-----
Total annual Fund operating expenses.................. 1.23%
Fee waivers*..........................................(0.23%)
-----
Net expenses.......................................... 1.00%
=====
[+ Until January 1, 2001, Numeric is entitled to a management fee of 0.75% of
the Fund's average daily net assets. Thereafter, Numeric is entitled to a
performance based fee calculated at the end of each month using a basic fee of
0.85% of average daily net assets and a performance fee adjustment based upon
the Fund's performance during the last rolling 12 month period. See
"Management-Investment Adviser" for a further discussion.]
* Numeric has agreed that until December 31, 2000, it will waive advisory fees
and reimburse expenses to the extent that total annual Fund operating
expenses exceed 1.00%.
Example
This example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. We are assuming an initial
investment of $10,000, 5% total return each year with no changes in operating
expenses or fee waivers and redemption at the end of each period. Although your
actual cost may be higher or lower, based on these assumptions your costs would
be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
$ -- $ -- $ -- $ --
The above example is for comparison purposes only and is not a representation of
the Fund's actual expenses and returns, either past or future.
-7-
<PAGE>
n/i numeric investors GROWTH FUND
Ticker Symbol: NISG
Investment Goal
The Fund's investment goal is to provide long-term capital appreciation.
Primary Investment Strategies
Under normal circumstances, the Fund invests in common stock of companies with
smaller ($1.2 billion or less) market capitalization or companies with
substantial equity capital and higher than average earnings growth rates.
Numeric determines its stock selection decisions for this Fund primarily on the
basis of its Growth Stock Model. Considered, but of significantly less
importance, is the Value Stock Model.
The Fund may use futures to reduce risk to the Fund as a whole (hedge); they may
also be used to maintain liquidity, commit cash pending investment or increase
returns.
The Fund may lend its portfolio securities to financial institutions. The Fund
will receive collateral in cash or high quality securities equal to the current
value of the loaned securities. These loans will be limited to 33 1/3% of the
value of the Fund's total assets.
The Fund may borrow money for temporary or emergency (not leveraging) purposes.
The Fund will not make any additional investments while borrowing s exceeds 5%
of its total assets.
Numeric may close the Fund to new investors if they believe a large increase in
the size of the Fund would adversely affect their investment strategy.
Accordingly, if the Fund's total assets exceed $125 million, Numeric will close
the Fund to new investors. (See Closing of Funds under Purchase of Fund
Shares.)
The Company's Board of Directors can change the investment objective of the
Fund. However, shareholders will be given 30 days notice before any change is
made.
Key Risks
. Common stocks may decline over short or even extended periods of time. Equity
markets tend to be cyclical; there are times when stock prices generally
increase, and other times when they generally decrease. Therefore, you could
lose money by investing in the Fund.
. The net asset value of the Fund will change with changes in the market value
of its portfolio positions.
. Investments in smaller-cap companies involve greater risk than is customarily
associated with larger more established companies due to the greater business
risks of small size, limited markets, and financial resources, narrow product
lines and frequent lack of depth of management.
. The securities of smaller-sized companies may be subject to more abrupt or
erratic market movements than securities of larger more established
companies.
. The Fund's securities may underperform other securities, or the equity
markets as a whole when they are out of favor.
. The Fund's use of futures may reduce returns and/or increase volatility.
Volatility is defined as the characteristic of a security or a market to
fluctuate significantly in price within a short time period.
-8-
<PAGE>
. Lending the Fund's portfolio securities involves the risk of a delay in
additional collateral if the value of the securities goes up while they are
on loan. There is also the risk of delay in recovering the loaned securities
and of losing rights to the collateral if the borrower goes bankrupt.
Portfolio Turnover -- The more often stocks are traded, the more the Fund will
be charged brokerage commissions and other transaction costs that lower
performance. In addition to higher transaction costs, high portfolio turnover
(generally considered over 100%) could result in the realization of taxable
capital gains.
Year 2000 -- The Fund, like any business, could be affected if the computer
systems on which it relies do not properly process information beginning on
January 1, 2000. While Year 2000 issues could have a negative effect on the
Fund, Numeric is currently working to avoid such problems. The Company is also
working with other systems providers and vendors to determine their systems'
ability to handle Year 2000 problems. There is no guarantee, however, that
systems will work properly on or after January 1, 2000. Year 2000 problems may
also hurt issuers whose securities the Fund holds or securities markets
generally.
Risk/Return Information
The chart and table below give you a picture of the Fund's long-term
performance. The information shows you how the Fund's performance has varied
year by year and provides some indication of the risks of investing in the Fund.
The chart and table below both assume reinvestment of dividends and
distributions. As with all such investments, past performance is not an
indication of future results. Performance reflects fee waivers in effect. If
fee waivers were not in place, the Fund's performance would be reduced.
As of 12/31
Annual Total Returns
[BAR CHART APPEARS HERE]
1996 1997 1998
---- ---- ----
10.42% 15.61% 2.20%
Year to date total return for the nine months ended September 30, 1999: ___%
Best Quarter: 28.22% (quarter ended September 30, 1997)
Worst Quarter: (35.99)% (quarter ended September 30, 1998)
-9-
<PAGE>
As of 12/31/98
Average Annual Total Returns - Comparison
1 Year Since Inception
------ ---------------
n/i numeric investors Growth Fund* 2.22% 10.86%
Russell 2500 Growth Index** ___% ___%
* Commenced operations on June 3, 1996.
** The Russell 2500 is an index of stocks 501 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.
Expenses and Fees
As a shareholder you pay certain fees and expenses. Annual Fund operating
expenses are paid out of Fund assets and are reflected in the Fund's price.
The table below describes the fees and expenses that you may pay if you buy and
hold shares of the Fund. The table is based on expenses for the most recent
fiscal year.
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)
Management fees[+].................................... 0.75%
Rule 12b-1 fees....................................... None
Other expenses........................................ 0.49%
-----
Total annual Fund operating expenses.................. 1.24%
Fee waivers*..........................................(0.24%)
-----
Net expenses.......................................... 1.00%
=====
[+ Until January 1, 2001, Numeric is entitled to a management fee of 0.75% of
the Fund's average daily net assets. Thereafter, Numeric is entitled to a
performance based fee calculated at the end of each month using a basic fee of
0.85% of average daily net assets and a performance fee adjustment based upon
the Fund's performance during the last rolling 12 month period. See
"Management-Investment Adviser" for a further discussion.]
* Numeric has agreed that until December 31, 2000, it will waive advisory fees
and reimburse expenses to the extent that total annual Fund operating
expenses exceed 1.00%.
Example
This example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. We are assuming an initial
investment of $10,000, 5% total return each year with no changes in operating
expenses or fee waivers and redemption at the end of each period. Although your
actual cost may be higher or lower, based on these assumptions your costs would
be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
$ -- $ -- $ -- $ --
The above example is for comparison purposes only and is not a representation of
the Fund's actual expenses and returns, either past or future.
-10-
<PAGE>
n/i numeric investors MID CAP FUND
Ticker Symbol: NIGV
Investment Goal
The Fund's investment goal is to provide long-term capital appreciation.
Primary Investment Strategies
Under normal circumstances, the Fund invests in common stocks of middle and
large capitalization companies where Numeric believes that earnings per share
are improving more rapidly than earnings per share of the average company, as
well as companies whose securities have market valuations which are lower than
the average market valuations of securities, as measured by such characteristics
as price to earnings ratios and price to book ratios. Numeric determines its
stock selection decisions for this Fund based on both the Growth Stock Model and
the Value Stock Model. The Fund anticipates that it will invest 65% of its
total assets in common stock of "mid cap" companies, which the Fund defines as
the 151st to the 1000th largest companies (excluding American Depositary
Receipts) as ranked by market capitalization. The market capitalization of the
1000th largest company is approximately $1.1 billion.
The Fund may use futures to reduce risk to the Fund as a whole (hedge); they may
also be used to maintain liquidity, commit cash pending investment or increase
returns.
The Fund may lend its portfolio securities to financial institutions. The Fund
will receive collateral in cash or high quality securities equal to the current
value of the loaned securities. These loans will be limited to 33 1/3% of the
value of the Fund's total assets.
The Fund may borrow money for temporary or emergency (not leveraging) purposes.
The Fund will not make any additional investments while borrowings exceed 5% of
its total assets.
Numeric may close the Fund to new investors if they believe a large increase in
the size of the Fund would adversely affect their investment strategy.
Accordingly, if the Fund's total assets exceed $200 million, Numeric will close
the Fund to new investors. (See Closing of Funds under Purchase of Fund
Shares.)
The Company's Board of Directors can change the investment objective of the
Fund. However, shareholders will be given 30 days notice before any change is
made.
Key Risks
. Common stocks may decline over short or even extended periods of time. Equity
markets tend to be cyclical; there are times when stock prices generally
increase, and other times when they generally decrease. Therefore, you could
lose money by investing in the Fund.
. The net asset value of the Fund will change with changes in the market value
of its portfolio positions.
. Investments in smaller-cap companies involve greater risk than is customarily
associated with larger more established companies due to the greater business
risks of small size, limited markets and financial resources, narrow product
lines and frequent lack of depth of management.
. The securities of smaller-sized companies may be subject to more abrupt or
erratic market movements than securities of larger more established
companies.
-11-
<PAGE>
. The Fund's securities may underperform other securities, or the equity
markets as a whole when they are out of favor.
. The Fund's use of futures may reduce returns and/or increase volatility.
Volatility is defined as the characteristic of a security or a market to
fluctuate significantly in price within a short time period.
. Lending the Fund's portfolio securities involves the risk of a delay in
additional collateral if the value of the securities goes up while they are
on loan. There is also the risk of delay in recovering the loaned securities
and of losing rights to the collateral if the borrower goes bankrupt.
Portfolio Turnover -- The more often stocks are traded, the more the Fund will
be charged brokerage commissions and other transaction costs that lower
performance. In addition to higher transaction costs, high portfolio turnover
(generally considered over 100%) could result in the realization of taxable
capital gains.
Year 2000 -- The Fund, like any business, could be affected if the computer
systems on which it relies do not properly process information beginning on
January 1, 2000. While Year 2000 issues could have a negative effect on the
fund, Numeric is currently working to avoid such problems. The Company is also
working with other systems providers and vendors to determine their systems'
ability to handle Year 2000 problems. There is no guarantee, however, that
systems will work properly on or after January 1, 2000. Year 2000 problems may
also hurt issuers whose securities the Fund holds or securities markets
generally.
Risk/Return Information
The chart and table below give you a picture of the Fund's long-term
performance. The information shows you how the Fund's performance has varied
year by year and provides some indication of the risks of investing in the Fund.
The chart and table below both assume reinvestment of dividends and
distributions. As with all such investments, past performance is not an
indication of future results. Performance reflects fee waivers in effect. If
fee waivers were not in place, the Fund's performance would be reduced.
As of 12/31
Annual Total Returns
[BAR CHART APPEARS HERE]
1996 1997 1998
---- ---- ----
11.41% 33.07% 13.88%
Year to date total return for the nine months ended September 30, 1999: ___%
Best Quarter: 25.61% (quarter ended September 30, 1997)
Worst Quarter: 3.83% (quarter ended September 30, 1996)
-12-
<PAGE>
As of 12/31/98
Average Annual Total Returns - Comparison
1 Year Since Inception
------ ---------------
n/i numeric investors Mid Cap Fund* 13.88% ___%
S&P MidCap 400 Index** ___% ___%
* Commenced operations on June 3, 1996.
** A broad-based index of 400 companies with market capitalizations currently
from $200 million to $38 billion. The Standard & Poor's MidCap 400 Index is
a widely accepted, unmanaged index of overall mid-cap stock market
performance.
Expenses and Fees
As a shareholder you pay certain fees and expenses. Annual Fund operating
expenses are paid out of Fund assets and are reflected in the Fund's price.
The table below describes the fees and expenses that you may pay if you buy and
hold shares of the Fund. The table is based on expenses for the most recent
fiscal year.
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)
Management fees[+]................................... 0.75%
Rule 12b-1 fees...................................... None
Other expenses....................................... 0.51%
-----
Total annual Fund operating expenses................. 1.26%
Fee waivers*.........................................(0.26%)
-----
Net expenses......................................... 1.00%
=====
[+ Until January 1, 2001, Numeric is entitled to a management fee of 0.75% of
the Fund's average daily net assets. Thereafter, Numeric is entitled to a
performance based fee calculated at the end of each month using a basic fee of
0.85% of average daily net assets and a performance fee adjustment based upon
the Fund's performance during the last rolling 12 month period. See
"Management-Investment Adviser" for a further discussion.]
* Numeric has agreed that until December 31, 2000, it will waive advisory fees
and reimburse expenses to the extent that total annual Fund operating
expenses exceed 1.00%.
Example
This example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. We are assuming an initial
investment of $10,000, 5% total return each year with no changes in operating
expenses or fee waivers and redemption at the end of each period. Although your
actual cost may be higher or lower, based on these assumptions your costs would
be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
$-- $-- $-- $--
The above example is for comparison purposes only and is not a representation of
the Fund's actual expenses and returns, either past or future.
-13-
<PAGE>
n/i numeric investors LARGER CAP VALUE FUND
Ticker Symbol: NILVX
Investment Goal
The Fund's investment goal is to provide long-term capital appreciation.
Primary Investment Strategies
Under normal circumstances, the Fund invests at least 65% of its total assets in
common stock of companies with a market capitalization of $2 billion or more.
The Fund may also invest in securities which are convertible into common stock,
fixed income securities and money market securities. Numeric determines its
stock selection decisions for this Fund primarily on the basis of its Value
Stock Model. Also considered, but of less importance, is the Growth Stock
Model. The Fund anticipates that it will invest a large portion of its total
assets in common stock of the 1000th largest companies (excluding American
Depositary Receipts) as ranked by market capitalization. The market
capitalization of the 1000th largest company is approximately $1.1 billion.
The Fund may use futures to reduce risk to the Fund as a whole (hedge); they may
also be used to maintain liquidity, commit cash pending investment or increase
returns.
The Fund may lend its portfolio securities to financial institutions. The Fund
will receive collateral in cash or high quality securities equal to the current
value of the loaned securities. These loans will be limited to 33 1/3% of the
value of the Fund's total assets.
The Fund may borrow money for temporary or emergency (not leveraging) purposes.
The Fund will not make any additional investments while borrowings exceed 5% of
its total assets.
The Company's Board of Directors can change the investment objective of the
Fund. However, shareholders will be given 30 days notice before any change is
made.
Key Risks
. Common stocks may decline over short or even extended periods of time. Equity
markets tend to be cyclical; there are times when stock prices generally
increase, and other times when they generally decrease. Therefore, you could
lose money by investing in the Fund.
. The net asset value of the Fund will change with changes in the market value
of its portfolio positions.
. The Fund's securities may underperform other securities, or the equity
markets as a whole when they are out of favor.
. The Fund's use of futures may reduce returns and/or increase volatility.
Volatility is defined as the characteristic of a security or a market to
fluctuate significantly in price within a short time period.
. Lending the Fund's portfolio securities involves the risk of a delay in
additional collateral if the value of the securities goes up while they are
on loan. There is also the risk of delay in recovering the loaned securities
and of losing rights to the collateral if the borrower goes bankrupt.
Portfolio Turnover -- The more often stocks are traded, the more the Fund will
be charged brokerage commissions and other transaction costs that lower
performance. In addition to higher transaction costs,
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high portfolio turnover (generally considered over 100%) could result in the
realization of taxable capital gains.
Year 2000 -- The Fund, like any business, could be affected if the computer
systems on which it relies do not properly process information beginning on
January 1, 2000. While Year 2000 issues could have a negative effect on the
Fund, Numeric is currently working to avoid such problems. The Company is also
working with other systems providers and vendors to determine their systems'
ability to handle Year 2000 problems. There is no guarantee, however, that
systems will work properly on or after January 1, 2000. Year 2000 problems may
also hurt issuers whose securities the Fund holds or securities markets
generally.
Risk/Return Information
The chart and table below give you a picture of the Fund's long-term
performance. The chart and table below both assume reinvestment of dividends
and distributions. As with all such investments, past performance is not an
indication of future results. Performance reflects fee waivers in effect. If
fee waivers were not in place, the Fund's performance would be reduced.
As of 12/31
Annual Total Returns
[BAR CHART APPEARS HERE]
1998
----
10.78%
Year to date total return for the nine months ended September 30, 1999: ___%
Best Quarter: 41.35% (quarter ended June 30, 1998)
Worst Quarter: 35.55% (quarter ended September 30, 1998)
As of 12/31/98
Average Annual Total Returns - Comparison
1 Year Since Inception
------ ---------------
n/i numeric investors Larger Cap Value 10.78% 10.75%
Fund*
Russell 1000 Value Index** ___% ___%
* Commenced operations on December 9, 1997.
** The Russell 1000 Index consists of the 1,000 largest securities in the
Russell 3000 Index as ranked by total market capitalization. This index is
segmented into growth and value categories. The Russell 1000 Value Index
contains stocks from the Russell 1000 with less than average growth
orientation. Companies in this index generally have low price to book and
price/earnings ratios, higher dividend yields, and lower forecasted growth
values.
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<PAGE>
Expenses and Fees
As a shareholder you pay certain fees and expenses. Annual Fund operating
expenses are paid out of Fund assets and are reflected in the Fund's price.
The table below describes the fees and expenses that you may pay if you buy and
hold shares of the Fund. The table is based on expenses for the most recent
fiscal year.
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)
Management fees[+]................................. 0.75%
Rule 12b-1 fees.................................... None
Other expenses..................................... 1.45%
-----
Total annual Fund operating expenses............... 2.20%
Fee waivers*....................................... (1.20%)
-----
Net expenses....................................... 1.00%
=====
[+ Until January 1, 2001, Numeric is entitled to a management fee of 0.75% of
the Fund's average daily net assets. Thereafter, Numeric is entitled to a
performance based fee calculated at the end of each month using a basic fee of
0.85% of average daily net assets and a performance fee adjustment based upon
the Fund's performance during the last rolling 12 month period. See
"Management-Investment Adviser" for a further discussion.]
* Numeric has agreed that until December 31, 2000, it will waive advisory fees
and reimburse expenses to the extent that total annual Fund operating
expenses exceed 1.00%.
Example
This example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. We are assuming an initial
investment of $10,000, 5% total return each year with no changes in operating
expenses or fee waivers and redemption at the end of each period. Although your
actual cost may be higher or lower, based on these assumptions your costs would
be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
$-- $-- $-- $--
The above example is for comparison purposes only and is not a representation of
the Fund's actual expenses and returns, either past or future.
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<PAGE>
n/i numeric investors SMALL CAP VALUE FUND
Ticker Symbol: NISV
Investment Goal
The Fund's investment goal is to provide long-term capital appreciation.
Primary Investment Strategies
Under normal circumstances, the Fund invests at least 65% of its total assets in
common stock of companies with market capitalizations of $1.5 billion or less.
Numeric determines its stock selection decisions for the Fund primarily on the
basis of its Value Stock Model. Also considered, but of less importance, is the
Growth Stock Model.
The Fund may use futures to reduce risk to the Fund as a whole (hedge); they may
also be used to maintain liquidity, commit cash pending investment or increase
returns.
The Fund may lend its portfolio securities to financial institutions. The Fund
will receive collateral in cash or high quality securities equal to the current
value of the loaned securities. These loans will be limited to 33 1/3% of the
value of the Fund's total assets.
The Fund may borrow money for temporary or emergency (not leveraging) purposes.
The Fund will not make any additional investments while borrowing s exceeds 5%
of its total assets.
The Company's Board of Directors can change the investment objective of the
Fund. However, shareholders will be given 30 days notice before any change is
made.
Key Risks
. Common stocks may decline over short or even extended periods of time. Equity
markets tend to be cyclical; there are times when stock prices generally
increase, and other times when they generally decrease. Therefore, you could
lose money by investing in the Fund.
. The net asset value of the Fund will change with changes in the market value
of its portfolio positions.
. Investments in smaller-cap companies involve greater risk than is customarily
associated with larger more established companies due to the greater business
risks of small size, limited markets, and financial resources, narrow product
lines and frequent lack of depth of management.
. The securities of smaller-sized companies may be subject to more abrupt or
erratic market movements than securities of larger more established
companies.
. The Fund's small-cap securities may underperform mid-cap or large-cap
securities, or the equity markets as a whole when they are out of favor.
. The Fund's use of futures may reduce returns and/or increase volatility.
Volatility is defined as the characteristic of a security or a market to
fluctuate significantly in price within a short time period.
. Lending the Fund's portfolio securities involves the risk of a delay in
additional collateral if the value of the securities goes up while they are
on loan. There is also the risk of delay in recovering the loaned securities
and of losing rights to the collateral if the borrower goes bankrupt.
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<PAGE>
Portfolio Turnover -- The more often stocks are traded, the more the Fund will
be charged brokerage commissions and other transaction costs that lower
performance. In addition to higher transaction costs, high portfolio turnover
(generally considered over 100%) could result in the realization of taxable
capital gains.
Year 2000 -- The Fund, like any business, could be affected if the computer
systems on which it relies do not properly process information beginning on
January 1, 2000. While Year 2000 issues could have a negative effect on the
fund, Numeric is currently working to avoid such problems. The Company is also
working with other systems providers and vendors to determine their systems'
ability to handle Year 2000 problems. There is no guarantee, however, that
systems will work properly on or after January 1, 2000. Year 2000 problems may
also hurt issuers whose securities the Fund holds or securities markets
generally.
Expenses and Fees
As a shareholder you pay certain fees and expenses. Annual Fund operating
expenses are paid out of Fund assets and are reflected in the Fund's price.
The table below describes the fees and expenses that you may pay if you buy and
hold shares of the Fund. The table is based on expenses for the most recent
fiscal year.
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)
Management fees[+]................................... 0.75%
Rule 12b-1 fees...................................... None
Other expenses....................................... 1.06%
-----
Total annual Fund operating expenses................. 1.81%
Fee waivers*......................................... (0.81%)
-----
Net expenses......................................... 1.00%
=====
[+ Until January 1, 2001, Numeric is entitled to a management fee of 0.75% of
the Fund's average daily net assets. Thereafter, Numeric is entitled to a
performance based fee calculated at the end of each month using a basic fee of
0.85% of average daily net assets and a performance fee adjustment based upon
the Fund's performance during the last rolling 12 month period. See
"Management-Investment Adviser" for a further discussion.]
* Numeric has agreed that until December 31, 2000, it will waive advisory fees
and reimburse expenses to the extent that total annual Fund operating
expenses exceed 1.00%.
Example
This example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. We are assuming an initial
investment of $10,000, 5% total return each year with no changes in operating
expenses or fee waivers and redemption at the end of each period. The table
below shows what you would pay if you invested $10,000 in the Fund over the
various time periods indicated. Although your actual cost may be higher or
lower, based on these assumptions your costs would be:
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
$-- $-- $-- $--
The above example is for comparison purposes only and is not a representation of
the Fund's actual expenses and returns, either past or future.
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<PAGE>
MANAGEMENT
Investment Adviser
Numeric Investors L.P. serves as investment adviser to the Funds. Numeric,
whose principal business address is One Memorial Drive, Cambridge, Massachusetts
02142, was organized in October 1989 as a Delaware limited partnership. The
firm, which specializes in the active management of U.S. and international
equity portfolios using internally developed quantitative stock selection and
portfolio risk-control techniques, currently has over $4.5 billion in assets
under management for individuals, limited partnerships, mutual funds, offshore
funds, pension plans and endowment accounts.
Langdon B. Wheeler, CFA is the founder and President of Numeric. Mr. Wheeler
received his MBA from Harvard University and an undergraduate degree from Yale
University. All investment decisions with respect to the Funds are made by a
team of Numeric Investor's Portfolio Management Department, which is subject to
the supervision of Mark F. Engerman, CFA. Mr. Engerman received a BS in Applied
Mathematics and Economics from Brown University. No one person is responsible
for making recommendations to that team. The general partner of Numeric is WBE
& Associates, LLC, a Delaware limited liability company. The President of WBE &
Associates, LLC is Mr. Wheeler.
For the Funds' fiscal year ended August 31, 1999, for its advisory services to
the n/i numeric investors Micro Cap Fund, n/i numeric investors Growth Fund, n/i
numeric investors Mid Cap Fund n/i numeric investors Larger Cap Value Fund, and
n/i numeric investors Small Cap Value Fund, Numeric received investment advisory
fees of ___%, ___%, ___%, ___% and ___%, respectively, of each Fund's average
daily net assets, after fee waivers and reimbursements, if any.
[Until January 1, 2001, Numeric is entitled to a management fee of 0.75% of each
Fund's average daily net assets before fee waivers and expense reimbursements,
if any. Thereafter, Numeric is entitled to a performance based fee. The current
fee of 0.75% would only increase if performance exceeds benchmark by more than
4% in a given 12-month period and would be less than the current fee if
performance does not exceed benchmark by 3% in a given 12-month period. The
performance based fee is calculated at the end of each month using a basic fee
of 0.85% of average daily net assets, and a performance fee adjustment based
upon each Fund's performance during the last rolling 12-month period. Each
Fund's net performance would be compared with the performance of its benchmark
index during that same rolling 12-month period. When a Fund's performance is at
least 5.00% better than its benchmark, it would pay Numeric more than the basic
fee. If a Fund did not perform at least 4.00% better than its benchmark, Numeric
would be paid less than the basic fee. Each 1.00% of the difference in
performance between a Fund and its benchmark plus 4.00% during the performance
period would result in a 0.10% adjustment to the basic fee. The benchmark index
for each of the Micro Cap, Growth, MidCap, Larger Cap Value and Small Cap Value
Funds is the Russell 2000 Growth Index, Russell 2500 Growth Index, S&P Mid Cap
400 Index, Russell 1000 Value Index and Russell 2000 Value Index, respectively.]
Other Service Providers
The following chart shows the Funds' other service providers and includes their
addresses and principal activities.
-19-
<PAGE>
<TABLE>
<CAPTION>
=========================================
Shareholders
=========================================
<S> <C> <C>
=================================== ===================================
Distribution and
Shareholder Principal Distributor Transfer Agent
Services Provident Distributors, Inc. PFPC Inc.
Four Falls Corporate Center, 6th Fl. 400 Bellevue Parkway
West Conshohocken, PA 19428 Wilmington, DE 19809
Distributes shares of the Funds. Handles shareholder services,
including record-keeping and
statements, distribution of
dividends and processing of buy
and sell requests.
=================================== ===================================
=================================== ===================================
Asset Management
Investment Adviser Custodian
n/i numeric investors lp/(R)/ Custodial Trust Company
One Memorial Drive 101 Carnegie Center
Cambridge, MA 02142 Princeton, NJ 05840
Manages each Fund's business and Holds each Fund's assets,
investment activities. settles all portfolio trades and
collects most of the valuation
data for calculating each Fund's
net asset value ("NAV").
=================================== ===================================
===================================
Fund Operations
Co-Administrator
Bear Stearns Funds Management Inc.
575 Lexington Avenue - 9th Floor
New York, NY 10022
Assists each of the Funds in all
aspects of their administration
and operations.
Co-Administrator
PFPC Inc.
400 Bellevue Parkway
Wilmington, DE 19809
Provides facilities, equipment
and personnel to carry out
administrative services related
to each Fund and calculates each
Fund's NAV, dividends and
distributions.
===================================
=========================================
Board of Directors
Supervises the Fund's activities.
=========================================
</TABLE>
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<PAGE>
SHAREHOLDER INFORMATION
Pricing of Fund Shares
Shares of the Funds are priced at their net asset value ("NAV"). The NAV of 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.
Each Fund's NAV is calculated once daily at the close of regular trading on the
New York Stock Exchange ("NYSE") (currently 4:00 p.m. Eastern time), each day
the NYSE is open. Fund shares will not be priced on the days that the NYSE is
closed.
Securities held by a Fund are valued using the closing price or the last sale
price on a national securities exchange or on the NASDAQ National Market System
where they are traded. If there were no sales on that day or the securities are
traded on other over-the-counter markets, the mean of the bid and asked prices
is used. Short term debt investments having maturities of 60 days or less are
amortized to maturity based on their cost. With the approval of the Company's
Board of Directors, a Fund may use a pricing service, bank or broker-dealer
experienced in providing valuations to value a Fund's securities. If market
quotations are unavailable or deemed unreliable by Numeric's Valuation
Committee, securities will be valued at fair value as determined by procedures
adopted by the Board.
Purchase of Fund Shares
You may purchase Shares of each Fund at the NAV per share next calculated after
your order is received by the Transfer Agent in proper form. After an initial
purchase is made, the Transfer Agent will set up an account for you on the
Company's records. The minimum initial investment in any Fund is $3,000 and the
minimum additional investment is $100. You can only purchase Shares of each Fund
on days the NYSE is open and through the means described below.
Initial Investment By Mail. Subject to acceptance by the Company, an account may
be opened by completing and signing the application included with this
Prospectus and mailing it to the Transfer Agent at the address noted below,
together with a check ($3,000 minimum) payable to n/i numeric investors family
of funds:
n/i numeric investors family of funds
c/o PFPC Inc.
P.O. Box 8966
Wilmington, DE 19899-8966
The name of the Fund(s) to be purchased should be designated on the application
and should appear on the check. Subject to acceptance by the Company, payment
for the purchase of Shares received by mail will be credited to a shareholder's
account at the NAV per share of the Fund next determined after receipt of
payment in good order.
Initial Investment By Wire. Subject to acceptance by the Company, Shares of each
Fund may be purchased by wiring federal funds to PNC Bank (see instructions
below). In order to use this option your investment must be at least $3,000. A
wire charge of $10.00 may be assessed. A completed application should be
forwarded to the Company at the address noted above under "Initial Investment by
Mail" in advance of the wire. For each Fund, notification must be given to the
Transfer Agent at 1-800-348-5031
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<PAGE>
prior to the close of trading on the NYSE (usually 4:00 p.m. Eastern time) on
the same day. (Prior notification must also be received from investors with
existing accounts.) Funds should be wired to:
PNC Bank
Philadelphia, Pennsylvania
From: (your name)
ABA# 031-0000-53
Account # 86-1108-2312
F/B/O n/i numeric investors family of funds
Ref. (Fund Name and Account Number)
Federal funds purchases will be accepted only on a day on which the NYSE and PNC
Bank are open for business.
Additional Investments. Additional investments may be made at any time by
mailing a check to the Transfer Agent at the address noted above under "Initial
Investment by Mail" (payable to n/i numeric investors family of funds), by
wiring monies to PNC Bank as outlined above under "Initial Investment by Wire."
Additional investments by wire must be at least $3,000. For each Fund,
notification must be given to the Transfer Agent at 1-800-348-5031 prior to the
close of trading on the NYSE (usually 4:00 p.m. Eastern time), on the same day.
Initial and additional purchases made by check cannot be redeemed until payment
of the purchase has been collected.
Additional Investments Via the Internet. You may also purchase Shares of the
Funds, up to $25,000 per day with no single trade over $10,000, via the
Internet. In order to engage in Internet transactions you must complete and
return a separate Internet account application. You can request an Internet
account application by contacting Numeric at http://www.numeric.com or by
calling 1-800- numeric.
After your Internet application is received, you will receive a Welcome Letter
that will provide you with further instructions.
The Company employs reasonable procedures to confirm that instructions
communicated over the Internet are genuine. Such procedures include, but are not
limited to, requiring a separate application for Internet access services and
appropriate personal identification for each on-line session, providing written
confirmations to the address of record and employing other precautions
reasonably designed to protect the integrity, confidentiality and security of
shareholder information. Neither the Company, Numeric, PDI, PFPC, BSFM nor any
agent of the Company will be liable for any loss, liability, cost or expense for
following instructions communicated via the Internet that they reasonably
believe to be genuine or for following such security procedures. In the event
that high volume on the Internet or other technical difficulties make Internet
access unavailable, investors may contact the Company through the other methods
described herein.
Shareholder Organizations. Shares of the Funds may also be sold to corporations
or other institutions such as trusts, foundations or broker-dealers purchasing
for the accounts of others ("Shareholder Organizations"). If you purchase and
redeem shares of the Funds through a Shareholder Organization, you may be
charged a transaction-based fee or other fee for the services of such
organization. Each Shareholder Organization is responsible for transmitting to
its customers a schedule of any such fees and information regarding any
additional or different conditions regarding purchases and redemptions.
Customers of Shareholder Organizations should read this Prospectus in light of
the terms governing accounts with their organization. The Company does not pay
to or receive compensation from
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<PAGE>
Shareholder Organizations for the sale of Shares. The Company officers are
authorized to waive the minimum initial and subsequent investment requirements.
Automatic Investment Plan. Additional investments in Shares of the Funds may be
made automatically by authorizing the Transfer Agent to withdraw funds from your
bank account through an Automatic Investment Plan. Investors desiring to
participate in an Automatic Investment Plan should call PFPC at (800) 348-5031
to obtain the appropriate forms, or complete the appropriate section of the
Application included with this Prospectus. The minimum initial investment for an
Automatic Investment Plan is $1,000, with minimum monthly payments of $100.
IRA Accounts. Shares of the Funds may be purchased in conjunction with
individual retirement accounts ("IRAs"), rollover IRAs, or pension, profit-
sharing or other employer benefit plans. Contact PFPC for further information as
to applications and annual fees. To determine whether the benefits of an IRA are
available and/or appropriate, a shareholder should consult with a tax adviser.
Other Purchase Information. The Company reserves the right, in its sole
discretion, to suspend the offering of shares of its Funds or to reject purchase
orders when, in the judgment of management, such suspension or rejection is in
the best interests of the Funds.
Closing of Funds. Numeric will monitor the Funds' total assets and may close any
of the Funds at any time to new investments or new accounts due to concerns that
a significant increase in the size of a Fund may adversely affect the
implementation of Numeric's investment strategy. Numeric may also choose to
reopen a closed fund to new investments at any time, and may subsequently close
such Fund again should concerns regarding Fund size recur. Numeric reserves the
right while a Fund is closed to accept new investments from any of its employees
or their spouses, parents or children, or to further restrict the sale of its
shares. If a Fund closes to new investments, the following may apply:
. The closed Fund would only be offered to certain existing shareholders
of that Fund and certain other persons, who are generally subject to
cumulative, maximum purchase amounts, as follows:
a. persons who already hold shares of the closed Fund directly or
through accounts maintained by brokers by arrangement with the
Company,
b. existing and future clients of financial advisors and planners
whose clients already hold shares of the closed Fund, and
c. employees of Numeric and their spouses and children.
Other persons who are shareholders of other n/i numeric investors
Funds are not permitted to acquire shares of the closed Fund by
exchange. Other purchase limitations may be implemented at the time of
closing. Distributions to all shareholders of the closed Fund will
continue to be reinvested unless a shareholder elected otherwise.
Redemption of Fund Shares
You may redeem Shares of the Funds at the next NAV calculated after a redemption
request is received by the Transfer Agent in proper form. The NAV is calculated
as of the close of trading on the NYSE (usually 4:00 p.m. Eastern time). You can
only redeem shares of the Funds on days the NYSE is open and through the means
described below.
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<PAGE>
You may redeem Shares of each Fund by mail, or, if you are authorized, by
telephone or via the Internet. There is no charge for a redemption. However, if
you redeem Shares held for less than six months, a transaction fee of 1% of the
net asset value of the Shares redeemed at the time of redemption will be
charged. This additional transaction fee is paid to each Fund, not the adviser,
distributor or transfer agent as reimbursement for transaction costs associated
with redemptions. The value of Shares redeemed may be more or less than the
purchase price, depending on the market value of the investment securities held
by the Fund.
Redemption By Mail. Your redemption requests should be addressed to n/i numeric
investors family of funds, c/o PFPC Inc., P.O. Box 8966, Wilmington, DE 19899-
8966 and must include:
a. a letter of instruction specifying the number of shares or dollar
amount to be redeemed, signed by all registered owners of the shares
in the exact names in which they are registered;
b. any required signature guarantees, which are required when (i) the
redemption request proceeds are to be sent to someone other than the
registered shareholder(s) or (ii) the redemption request is for
$10,000 or more. A signature guarantee may be obtained from a domestic
bank or trust company, broker, dealer, clearing agency or savings
association who are participants in a Medallion Program recognized by
the Securities Transfer Association. The three recognized Medallion
Programs are Securities Transfer Agent Medallion Program (STAMP),
Stock Exchanges Medallion Program (SEMP) and New York Stock Exchange,
Inc. Medallion Program (MSP). Signature Guarantees, which are not a
part of these programs, will not be accepted. Please note that a
notary public stamp or seal is not acceptable; and
c. other supporting legal documents, if required, in the case of estates,
trusts, guardianships, custodianships, corporations, pension and
profit sharing plans and other organizations.
Redemption By Telephone. In order to request a telephone redemption, you must
have returned your account application containing a telephone election. To add a
telephone redemption option to an existing account, contact the Transfer Agent
by calling 1-800-348-5031.
Once you are authorized to utilize the telephone redemption option, a redemption
of Shares may be requested by calling the Transfer Agent at 1-800-348-5031 and
requesting that the redemption proceeds be mailed to the primary registration
address or wired per the authorized instructions. If the telephone redemption
option or the telephone exchange option (as described below) is authorized, the
Transfer Agent may act on telephone instructions from any person representing
himself or herself to be a shareholder and believed by the Transfer Agent to be
genuine. The Transfer Agent's records of such instructions are binding and
shareholders, not the Company or the Transfer Agent, bear the risk of loss in
the event of unauthorized instructions reasonably believed by the Company or the
Transfer Agent to be genuine. The Transfer Agent will employ reasonable
procedures to confirm that instructions communicated are genuine and, if it does
not, it may be liable for any losses due to unauthorized or fraudulent
instructions. The procedures employed by the Transfer Agent in connection with
transactions initiated by telephone include tape recording of telephone
instructions and requiring some form of personal identification prior to acting
upon instructions received by telephone.
For accounts held of record by Shareholder Organizations, 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
-24-
<PAGE>
be permitted in connection with IRA or other retirement plan accounts or by an
attorney-in-fact under power of attorney.
Redemption Via the Internet. You may also redeem and exchange Shares of the
Funds, up to $25,000 per day with no single trade over $10,000, via the
Internet. In order to engage in Internet transactions you must complete and
return a separate Internet account application. You can request an Internet
account application by contacting Numeric at http://www.numeric.com or by
calling 1-800- numeric.
After your Internet application is received, you will receive a Welcome Letter
that will provide you with further instructions.
The Company employs reasonable procedures to confirm that instructions
communicated over the Internet are genuine. Such procedures include, but are not
limited to, requiring a separate application for Internet access services and
appropriate personal identification for each on-line session, providing written
confirmations to the address of record and employing other precautions
reasonably designed to protect the integrity, confidentiality and security of
shareholder information. Neither the Company, Numeric, PDI, PFPC, BSFM nor any
agent of the Company will be liable for any loss, liability, cost or expense for
following instructions communicated via the Internet that they reasonably
believe to be genuine or for following such security procedures. In the event
that high volume on the Internet or other technical difficulties make Internet
access unavailable, investors may contact the Company through the other methods
described herein.
Automatic Withdrawal. Automatic withdrawal permits you to request withdrawal of
a specified dollar amount (minimum of $25) on either a monthly, quarterly or
annual basis if you have a $10,000 minimum account balance. An application for
automatic withdrawal can be obtained from the Transfer Agent. Automatic
withdrawal may be ended at any time by the investor, the Company or the Transfer
Agent. Purchases of additional shares concurrently with withdrawals generally
are undesirable.
Transaction Fee on Certain Redemptions of the Funds. The Funds require the
payment of a transaction fee on redemptions of Shares held for less than six
months equal to 1.00% of the net asset value of such Shares redeemed at the time
of redemption. This additional transaction fee is paid to each Fund, not to the
adviser, distributor or transfer agent. It is not a sales charge or a contingent
deferred sales charge. The fee does not apply to redeemed Shares that were
purchased through reinvested dividends or capital gain distributions. The
purpose of the additional transaction fee is to indirectly allocate transaction
costs associated with redemptions to those investors making redemptions after
holding their shares for a short period, thus protecting existing shareholders.
These costs include: (1) brokerage costs; (2) market impact costs -- i.e., the
decrease in market prices which may result when a Fund sells certain securities
in order to raise cash to meet the redemption request; (3) the realization of
capital gains by the other shareholders in each Fund; and (4) the effect of the
"bid-ask" spread in the over-the-counter market. The 1.00% amount represents
each Fund's estimate of the brokerage and other transaction costs which may be
incurred by each Fund in disposing of stocks in which each Fund may invest.
Without the additional transaction fee, each Fund would generally be selling its
shares at a price less than the cost to each Fund of acquiring the portfolio
securities necessary to maintain its investment characteristics, resulting in
reduced investment performance for all shareholders in the Funds. With the
additional transaction fee, the transaction costs of selling additional stocks
are not borne by all existing shareholders, but the source of funds for these
costs is the transaction fee paid by those investors making redemptions of the
Funds.
Involuntary Redemption. The Company 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
-25-
<PAGE>
less than $500 and will be allowed 30 days to make additional investments before
the redemption is processed. The transaction fee will not be charged when shares
are involuntarily redeemed.
Other Redemption Information. Redemption proceeds for Shares of the Funds
recently purchased by check may not be distributed until payment for the
purchase has been collected, which may take up to fifteen days from the purchase
date. Shareholders can avoid this delay by utilizing the wire purchase option.
Other than as described above, redemption proceeds will ordinarily be paid
within seven business days after a redemption request is received by the
Transfer Agent in proper form. The Company may suspend the right of redemption
or postpone the date at times when the NYSE is closed or under any emergency
circumstances as determined by the SEC.
If the Board of Directors determines that it would be detrimental to the best
interests of the remaining shareholders of the Funds to make payment wholly or
partly in cash, redemption proceeds may be paid in whole or in part by a
distribution in-kind of readily marketable securities held by a Fund instead of
cash in conformity with applicable rules of the SEC. Investors generally will
incur brokerage charges on the sale of portfolio securities so received in
payment of redemptions. 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.
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 Fund for Shares of any other Fund up to three (3) times per year
(at least 30 days apart). 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. An exchange of
Shares held for less than six months (with the exception of Shares purchased
through dividend reinvestment or the reinvestment of capital gains) will be
subject to the 1.00% transaction fee. In addition, the Company 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. A shareholder
wishing to make an exchange may do so by sending a written request to the
Transfer Agent or, if authorized, by telephone or Internet.
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. See "Redemption By Mail" for information on signature
guarantees. The exchange privilege may be modified or terminated at any time, or
from time to time, by the Company, upon 60 days' written notice to shareholders.
If an exchange is to a new n/i numeric investors family fund, the dollar value
of Shares acquired must equal or exceed the Company's minimum for a new account;
if to an existing account, the dollar value must equal or exceed the Company's
minimum for subsequent investments. If an amount remains in the n/i numeric
investors Fund from which the exchange is being made that is below the minimum
account value required, the account will be subject to involuntary redemption.
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
-26-
<PAGE>
may potentially disrupt the management of the Funds and increase transactions
costs, the Funds have established a policy of limiting excessive exchange
activity. Shareholders are entitled to three (3) 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 n/i numeric investors Funds) that the
investment adviser reasonably deems to be disruptive to efficient portfolio
management.
Dividends and Distributions
Each Fund will distribute substantially all of its net investment income and net
realized capital gains, if any, to its shareholders. Its distributions are
reinvested in additional full and fractional Shares of the Fund unless a
shareholder elects otherwise.
The Funds expect to declare and pay dividends from net investment income
annually. Net realized capital gains (including net short-term capital gains),
if any, will be distributed at least annually.
Taxes
Each Fund contemplates declaring as dividends each year all or substantially all
of its taxable income, including its net capital gain (the excess of long-term
capital gain over short-term capital loss). Distributions attributable to the
net capital gain of a Fund will be taxable to you as long-term capital gain,
regardless of how long you have held your shares. Other Fund distributions
(other than exempt-interest dividends, discussed below) will generally be
taxable as ordinary income. You will be subject to income tax on Fund
distributions regardless whether they are paid in cash or reinvested in
additional shares. You will be notified annually of the tax status of
distributions to you.
You should note that if you purchase just before a distribution, the purchase
price will reflect the amount of the upcoming distribution, but you will be
taxable on the entire amount of the distribution received, even though, as an
economic matter, the distribution simply constitutes a return of capital. This
is known as "buying into a dividend."
You will recognize taxable gain or loss on a sale, exchange or redemption of
your shares, including an exchange for shares of another Fund, based on the
difference between your tax basis in the shares and the amount you receive for
them. (To aid in computing your tax basis, you generally should retain your
account statements for the periods during which you held shares.) Any loss
realized on shares held for six months or less will be treated as a long-term
capital loss to the extent of any capital gain dividends that were received on
the shares.
The one major exception to these tax principles is that distributions on, and
sales, exchanges and redemptions of, shares held in an IRA (or other tax-
qualified plan) will not be currently taxable.
The foregoing is only a summary of certain tax considerations under current law,
which may be subject to change in the future. Shareholders who are nonresident
aliens, foreign trusts or estates, or foreign corporations or partnerships, may
be subject to different United States federal income tax treatment. You should
consult your tax adviser for further information regarding federal, state, local
and/or foreign tax consequences relevant to your specific situation.
The Company may be required to withhold federal income tax at a rate of 31%
("backup withholding") from dividends and redemption proceeds paid to non-
corporate shareholders. This tax may be withheld from dividends if (i) you fail
to furnish the Company with your correct taxpayer identification number,
-27-
<PAGE>
(ii) the Internal Revenue Service ("IRS") notifies the Company that you have
failed to report properly certain interest and dividends income to the IRS and
to respond to notices to that effect, or (iii) when required to do so, you fail
to certify that you are not subject to backup withholding.
State and Local Taxes. Shareowners may also be subject to state and local taxes
on distributions and redemptions. State income taxes may not apply however, to
the portions of each Fund's distributions, if any, that are attributable to
interest on federal securities or interest on securities of the particular state
or localities within the state. Shareowners should consult their tax advisers
regarding the tax status of distributions in their state and locality.
-28-
<PAGE>
FINANCIAL HIGHLIGHTS
The financial information in the table below shows the Funds' financial
performance for the periods indicated. Certain information reflects results for
a single Fund share. The term "Total Return" indicates how much your investment
would have increased or decreased during this period of time and assumes that
you have reinvested all dividends and distributions. These figures have been
____ by ______, the Company's _______. The ______ report, along with the Funds'
_______, are included in the Funds' _________, which is available upon request
(see back cover for ordering instructions).
FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout Each Period)
<TABLE>
<CAPTION>
MICRO CAP FUND GROWTH FUND
====================================================================================================================================
Year Year Year Period Year Year Year Period
Ended Ended Ended 6/3/96* to Ended Ended Ended 6/3/96* to
8/31/99 8/31/98 8/31/97 8/31/96 8/31/99 8/31/98 8/31/97 8/31/96
=================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 18.47 $ 11.67 $ 12.00 $ 16.29 $ 11.84 $ 12.00
------- -------- -------- -------- -------- --------
Income from investment operations:
Net investment income (0.07) (0.01) 0.01 (0.07) (0.04) 0.01
Net realized and unrealized gain/(loss) on
securities (3.23) 6.82 (0.34) (3.98) 4.50 (0.17)
------- -------- -------- -------- -------- --------
Total from investment operations (3.30) 6.81 (0.33) (4.05) 4.46 (0.16)
------- -------- -------- -------- -------- --------
Less Distributions:
Distributions from net investment income -- (0.01) -- -- (0.01) --
Distributions from realized capital gains (2.65) -- -- (2.49) -- --
------- -------- -------- -------- -------- --------
Total distributions (2.65) (0.01) -- (2.49) (0.01) --
------- -------- -------- -------- -------- --------
Net asset value, end of period $ 12.52 $ 18.47 $ 11.67 $ 9.75 $ 16.29 $ 11.84
======= ======== ======== ======== ======== ========
Total return (20.74)% 58.41% (2.75)% (29.03)% 37.69% (1.33)%
======= ======== ======== ======== ======== ========
Ratios/Supplemental Data
Net assets, end of period (000) $99,266 $142,119 $ 14,100 $ 77,840 $117,724 $ 26,756
Ratios of expenses to average net assets:
After advisory/administration fee waivers 1.00% 1.00% 1.00%** 1.00% 1.00% 1.00%**
Before advisory/administration fee waivers 1.23% 1.45% 3.40% 1.24% 1.40% 2.62%
Ratios of net investment income to average net
assets
After advisory/administration fee waivers (0.41)% (0.06)% 0.73%** (0.50)% (0.38)% 0.71%**
Portfolio turnover rate 408.70% 233.49% 42.92% 338.40% 266.25% 19.21%
====================================================================================================================================
</TABLE>
* Commenced operations.
** Annualized.
-29-
<PAGE>
<TABLE>
<CAPTION>
SMALL
CAP
LARGER CAP VALUE
MID CAP FUND VALUE FUND FUND
====================================================================================================================================
Year Year Year Period Year Period Period
Ended Ended Ended 6/3/96* to Ended 12/9/97* to __/__98* to
8/31/99 8/31/98 8/31/97 8/31/96 8/31/99 8/31/98 8/31/99
=======================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 17.16 $ 11.56 $ 12.00 $ 12.00
-------- -------- -------- --------
Income from investment operations:
Net investment income 0.05 (0.08) 0.03 0.06
Net realized and unrealized gain/(loss)
on securities (1.24) 5.58 (0.47) (1.22)
-------- -------- -------- --------
Total from investment operations (1.19) 5.66 (0.44) (1.16)
-------- -------- -------- --------
Less Distributions:
Distributions from net investment income (0.06) (0.06) -- --
Distributions from realized capital gains (2.61) -- -- --
-------- -------- --------
Total distributions (2.67) (0.06) -- --
-------- -------- --------
Net asset value, end of period $ 13.30 $ 17.16 $ 11.56 $ 10.84
======== ======== ======== ========
Total return (8.97)% 49.11% (3.67)% (9.67)%
======== ======== ======== ========
Ratios/Supplemental Data
Net assets, end of period (000) $110,176 $ 52,491 $ 3,813 $ 25,257
Ratios of expenses to average net assets:
After advisory/administration fee waivers 1.00% 1.00% 1.00%** 1.00%**
Before advisory/administration fee waivers 1.26% 1.81% 8.98% 2.20%**
Ratios of net investment income to
average net assets
After advisory/administration fee waivers (0.36)% (0.79)% 1.89%** 1.26%**
Portfolio turnover rate 341.73% 263.83% 5.25% 166.81%
====================================================================================================================================
</TABLE>
* Commenced operations.
** Annualized.
-30-
<PAGE>
n/i numeric investors family of funds
1-800-numeric (686-3742)
ACCOUNT APPLICATION
Important Information: Please read before completing this Account Application.
. Retirement Accounts. Do not use this form to open an individual retirement
plan account (such as an IRA). For an IRA application or help with this
Application, please call 1-800-numeric (686-3742).
. Internet Transactions. If you wish to engage in Internet transactions, you
must complete and return an additional Internet account application, which
can be obtained by contacting Numeric on their website at
http://www.numeric.com or by calling 1-800-numeric (686-3742).
- --------------------------------------------------------------------------------
1. ACCOUNT REGISTRATION: (Please check the appropriate box(es) below.)
- --------------------------------------------------------------------------------
[_] Individual [_] Joint Tenant
________________________________________________________________________________
NAME
________________________________________________________________________________
SOCIAL SECURITY NUMBER OF PRIMARY OWNER
________________________________________________________________________________
NAME OF JOINT OWNER (if applicable)
________________________________________________________________________________
JOINT OWNER SOCIAL SECURITY NUMBER
For joint accounts, the account registrants will be joint tenants with right of
survivorship and not tenants in common unless tenants in common or community
property registrations are requested.
GIFT TO MINOR (if applicable):
[_] Uniform Gifts/Transfers to Minor's Act
________________________________________________________________________________
NAME OF ADULT CUSTODIAN (ONLY ONE PERMITTED)
________________________________________________________________________________
NAME OF MINOR (ONLY ONE PERMITTED)
________________________________________________________________________________
MINOR'S SOCIAL SECURITY NUMBER DATE OF BIRTH
<PAGE>
CORPORATION, PARTNERSHIP, TRUST OR OTHER ENTITY (if applicable):
________________________________________________________________________________
________________________________________________________________________________
NAME OF CORPORATION, PARTNERSHIP, OR OTHER
________________________________________________________________________________
NAME(S) OF TRUSTEE(S)
________________________________________________________________________________
TAXPAYER IDENTIFICATION NUMBER
________________________________________________________________________________
TRUST DATE
- --------------------------------------------------------------------------------
2. MAILING ADDRESS:
- --------------------------------------------------------------------------------
________________________________________________________________________________
STREET OR P.O. BOX APARTMENT NUMBER
________________________________________________________________________________
CITY STATE ZIP CODE
( ) ( )
- --------------------------------------------------------------------------------
DAY PHONE NUMBER EVENING PHONE NUMBER
E-MAIL ADDRESS (REQUIRED FOR INTERNET ACCESS; OTHERWISE OPTIONAL BUT
RECOMMENDED)
- --------------------------------------------------------------------------------
3. INVESTMENT AMOUNT:
- --------------------------------------------------------------------------------
Minimum initial investment of $3,000 per Fund or $1,000 for an automatic
investment plan.
[_] n/i numeric investors Micro Cap (50) $___________
[_] n/i numeric investors Growth (51) $___________
[_] n/i numeric investors Mid Cap (52) $___________
[_] n/i numeric investors Larger Cap Value (53) $___________
[_] n/i numeric investors Small Cap Value (54) $___________
Make the check payable to n/i numeric investors family of funds. $
============
Shareholders may not purchase shares of the n/i numeric investors Funds with a
check issued by a third party and endorsed over to the Funds. Checks for
investment must be made payable to the n/i numeric investors family of funds.
<PAGE>
- --------------------------------------------------------------------------------
4. DISTRIBUTION OPTIONS:
- --------------------------------------------------------------------------------
NOTE: Dividends and capital gains may be reinvested or paid by check. If no
options are selected below, both dividends and capital gains will be reinvested
in additional Fund shares.
Dividends [_] Pay by check [_] Reinvest
Capital Gains [_] Pay by check [_] Reinvest
Please check one of the following options:
[_] Please mail checks to Address of Record
(Named in Section 2)
[_] Please electronically credit my Bank of Record
(Named in Section 8)
- --------------------------------------------------------------------------------
5. TELEPHONE EXCHANGE AND REDEMPTION:
- --------------------------------------------------------------------------------
To use this option, you must initial the appropriate line below.
I authorize the Transfer Agent to accept instructions from any person to
exchange shares in my account(s) by telephone in accordance with the procedures
and conditions set forth in the Fund's current prospectus.
________ _____________ Exchange shares for shares of another n/i
initial joint initial numeric investors Fund.
________ _____________ Redeem shares, and send the proceeds to the
initial joint initial address of record (not applicable to IRA accounts).
- --------------------------------------------------------------------------------
6. AUTOMATIC INVESTMENT PLAN (if applicable):
- --------------------------------------------------------------------------------
Please attach an unsigned, voided check.
The Automatic Investment Plan ($1,000 minimum initial investment), makes
possible regularly scheduled purchases of Fund shares. The Fund's Transfer
Agent can arrange for an amount of money selected by you ($100 minimum to be
deducted from your checking account and used to purchase shares of a specified
n/i numeric investors Fund.
Please debit $______ from my checking account (named below) on or about the 20th
of every month.
$______________ into the Micro Cap Fund ___________ Start Month.
------------------
$100 minimum
$______________ into the Growth Fund ___________ Start Month.
------------------
$100 minimum
$______________ into the Mid Cap Fund ___________ Start Month.
------------------
$100 minimum
$______________ into the Larger Cap Value Fund ___________ Start Month.
------------------
$100 minimum
<PAGE>
$______________ into the Small Cap Value Fund ___________ Start Month.
------------------
$100 minimum
- --------------------------------------------------------------------------------
7. SYSTEMATIC WITHDRAWAL PLAN (if applicable choose A or B):
- --------------------------------------------------------------------------------
. A minimum account value of $10,000 in a single account is required to
establish a Systematic Withdrawal Plan
. Payments will be made on or near the 25th of the month
A. For deposit of redemption proceeds into your Bank account.
Please attach an unsigned, voided check
To select this option please fill out the information below:
Fund Name_______________________ Amount____________________
Startup Month___________________
Frequency Options: [_] Annually [_] Monthly [_] Quarterly
B. For transfer to an existing n/i numeric investors Fund account:
(For transfers from more than one existing account, please call 1-800-
numeric (686-3742))
To select this option please fill out the information below:
I authorize PFPC Inc. to withdraw a total of $____________($50 minimum per Fund)
from my ________________________________________________________________________
(Fund Name) (Account Number)
to purchase shares of the following Funds
1) _________________________(Fund Name) $________________
2) _________________________(Fund Name) $________________
3) _________________________(Fund Name) $________________
4) _________________________(Fund Name) $________________
Startup Month________________
Frequency Options: [_] Annually [_] Monthly [_] Quarterly
- --------------------------------------------------------------------------------
8. BANK OF RECORD
- --------------------------------------------------------------------------------
Complete only if you chose to have your dividends and/or capital gains
electronically credited to your bank account (Section 4) or you are using
Automatic Investment Plan (Section 6) or Systematic Withdrawal Plan (Section 7A)
________________________________________________________________________________
BANK NAME
________________________________________________________________________________
STREET ADDRESS OR P.O. BOX
________________________________________________________________________________
CITY STATE ZIP CODE
<PAGE>
________________________________________________________________________________
BANK ABA NUMBER BANK ACCOUNT NUMBER
- --------------------------------------------------------------------------------
9. SIGNATURES:
- --------------------------------------------------------------------------------
The undersigned warrants that I (we) have full authority and, if a natural
person, I (we) am (are) of legal age to purchase shares pursuant to this Account
Information Form, and I (we) have received a current prospectus for the n/i
numeric investors Fund(s) in which I (we) am (are) investing.
Under the Interest and Dividend Tax Compliance Act of 1983, the Fund is required
to have the following certification:
Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct taxpayer identification number
(or I am waiting for a number to be issued to me), and
(2) I am not subject to backup withholding because (a) I am exempt from backup
withholding, or (b) I have not been notified by the Internal Revenue
Service that I am subject to 31% backup withholding as a result of a
failure to report all interest or dividends, or (c) the IRS has notified me
that I am no longer subject to backup withholding.
Note: You must cross out item (2) above if you have been notified by the IRS
that you are currently subject to backup withholding because you have failed to
report all interest and dividends on your tax return. The Internal Revenue
Service does not require your consent to any provision of this document other
than the certification required to audit backup withholding.
________________________________________________________________________________
SIGNATURE OF APPLICANT DATE
________________________________________________________________________________
PRINT NAME TITLE (IF APPLICABLE)
________________________________________________________________________________
SIGNATURE OF JOINT OWNER DATE
________________________________________________________________________________
PRINT NAME TITLE (IF APPLICABLE)
(If you are signing for a corporation, you must indicate corporate office or
title. If you wish additional signatories on the account, please include a
corporate resolution. If signing as a fiduciary, you must indicate capacity.)
For information on additional options, such as IRA Applications, rollover
requests for qualified retirement plans, or for wire instructions, please call
us at 1-800-numeric (686-3742). For information on new or existing accounts
call 1-800-348-5031.
Mail completed Account Application and check to:
n/i numeric investors family of funds
c/o PFPC Inc.
P.O. Box 8966
Wilmington, DE 19899-8966
<PAGE>
n/i numeric investors family of funds
1-800-numeric (686-3742)
http://www.numeric.com
For More Information:
This prospectus contains important information you should know before you
invest. Read it carefully and keep it for future reference. More information
about the n/i numeric investors family of funds is available free, upon request,
including:
Annual/Semi-Annual Report
These reports contain additional information about each of the funds'
investments, describe the Funds' performance, list portfolio holdings, and
discuss recent market conditions, economic trends and fund strategies for the
last fiscal year.
Statement of Additional Information (SAI)
A Statement of Additional Information, dated December 1, 1999 has been filed
with the Securities and Exchange Commission (SEC). The SAI, which includes
additional information about the n/i numeric investors family of funds, may be
obtained free of charge, along with the n/i numeric investors family of funds
annual and semi-annual reports, by calling (800) 348-5031. The SAI, as
supplemented from time to time, is incorporated by reference into this
Prospectus and is legally considered a part of this Prospectus.
Shareholder Inquiries
Representatives are available to discuss account balance information, mutual
fund prospectuses, literature, programs and services available. Hours: 8 a.m. to
6 p.m. (Eastern time) Monday-Friday. Call: (800) 348-5031 or visit Numeric's
Website at http://www.numeric.com
Written Correspondence
Post Office Address: n/i numeric investors family of funds
c/o PFPC, Inc. PO Box 8950
Wilmington, DE 19899-8950
Street Address: n/i numeric investors family of funds
c/o PFPC, Inc. 400 Bellevue Parkway
Wilmington, DE 19809
Securities and Exchange Commission (SEC)
You may also view information about The RBB Fund, Inc. and the n/i numeric
investors family of funds, including the SAI, by visiting the SEC Web site
(http://www.sec.gov) or the SEC's Public Reference Room in Washington, D.C.
Information about the operation of the public reference room can be obtained by
calling the SEC directly at 1-800-SEC-0330. Copies of this information can be
obtained, for a duplicating fee, by writing to the Public Reference Section of
the SEC, Washington, D.C. 20549-6009.
INVESTMENT COMPANY ACT FILE NO. 811-05518
<PAGE>
n/i numeric investors Micro Cap Fund
n/i numeric investors Growth Fund
n/i numeric investors Mid Cap Fund
n/i numeric investors Larger Cap Value Fund
n/i numeric investors Small Cap Value Fund
(Investment Portfolios of The RBB Fund, Inc.)
STATEMENT OF ADDITIONAL INFORMATION
DECEMBER 1, 1999
This Statement of Additional Information ("SAI") provides information about
the n/i numeric investors Micro Cap Fund (the "Micro Cap Fund"), the n/i numeric
investors Growth Fund (the "Growth Fund"), the n/i numeric investors Mid Cap
Fund (the "Mid Cap Fund") (formerly, the n/i numeric investors Growth & Value
Fund), the n/i numeric investors Larger Cap Value Fund (the "Larger Cap Value
Fund") and the n/i numeric investors Small Cap Value Fund (the "Small Cap Value
Fund") (together, the "Funds") of The RBB Fund, Inc. ("RBB"). This information
is in addition to the information contained in the n/i numeric investors family
of funds Prospectus dated December 1, 1999 (the "Prospectus").
This SAI is not a prospectus. It should be read in conjunction with the
Prospectus and the Funds' Annual Report dated August 31, 1999. The financial
statements and notes contained in the Annual Report are incorporated by
reference into this SAI. Copies of the Prospectus and Annual Report may be
obtained from Numeric Investors L.P. ("Numeric") by calling toll-free (800)
NUMERIC [(800) 686-3742].
<PAGE>
TABLE OF CONTENTS
PAGE
----
GENERAL INFORMATION................................................. 3
INVESTMENT INSTRUMENTS AND POLICIES................................. 3
INVESTMENT LIMITATIONS.............................................. 16
MANAGEMENT OF THE COMPANY........................................... 19
Directors and Officers......................................... 19
Directors' Compensation........................................ 20
INVESTMENT ADVISORY, DISTRIBUTION AND SERVICING ARRANGEMENTS........ 21
Advisory Agreements............................................ 21
Custodian Agreements........................................... 23
Transfer Agency Agreements..................................... 24
Co-Administration Agreements................................... 24
Administrative Services Agent.................................. 25
Distributor.................................................... 26
FUND TRANSACTIONS................................................... 27
ADDITIONAL INFORMATION CONCERNING RBB SHARES........................ 29
PURCHASE AND REDEMPTION INFORMATION................................. 31
VALUATION OF SHARES................................................. 32
PERFORMANCE INFORMATION............................................. 33
TAXES............................................................... 36
MISCELLANEOUS....................................................... 38
Counsel........................................................ 38
Independent Accountants........................................ 38
Banking Laws................................................... 38
FINANCIAL STATEMENTS................................................ 39
APPENDIX A.......................................................... A-1
<PAGE>
GENERAL INFORMATION
RBB was organized as a Maryland corporation on February 29, 1988 and is an
open-end management investment company currently operating or proposing to
operate _____ separate investment portfolios. This Statement of Additional
Information pertains to Shares representing interests in the Funds offered by
the Prospectus dated December 1, 1999.
INVESTMENT INSTRUMENTS AND POLICIES
The following supplements the information contained in the Prospectus
concerning the investment objectives and policies of the Funds.
Equity Markets
The Funds invest primarily in equity markets at all times. Equity markets
can be highly volatile, so that investing in the Funds involves substantial
risk. In addition, the Funds can and will typically invest in stocks that are
riskier and more volatile than the average stock. As a result, investing in
these Funds involves risk of substantial loss of capital.
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.
Market Fluctuation
Because the investment alternatives available to each Fund may be limited
by the 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.
Futures and Options
The Funds may write covered call options, buy put options, buy call options
and write put options, without limitation except as noted below. Such options
may relate to particular securities or to various indexes and may or may not be
listed on a national securities exchange or 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, including conversion of cash to equity.
<PAGE>
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 subject to Numeric's ability to predict correctly 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 futures 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.
Futures
Futures Contracts. To enter into a futures contract, the Funds must make a
deposit of an initial margin with their custodian in a segregated account in the
name of the futures broker or directly with the futures broker itself.
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.
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
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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.
The Fund may sell futures contracts to hedge its other investments against
changes in value, or as an alternative to sales of securities. For example, if
the Adviser anticipated a decline in the price of a particular security, but did
not wish to sell such securities owned by the Fund, it could sell a futures
contract in order to lock in a current sale price. If prices subsequently fell,
the futures contract's value would be expected to rise and offset all or a
portion of the loss in the securities that the Fund has 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.
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
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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 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.
Put and Call Options
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.
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
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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 exercise by closing out the
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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.
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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 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 net 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
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.
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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 liquid marketable 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. A Fund may purchase call
options to provide a hedge against an increase in the price of a security sold
short by the Fund. See "Futures and Options" 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.
Short Sales "Against the Box"
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 that 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.
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
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current price, but also wishes possibly to defer recognition of gain or loss for
federal income tax purposes. (A short sale against the box will defer
recognition of gain for federal income tax purposes only if the Portfolio
subsequently closes the short position by making a purchase of the relevant
securities no later than 30 days after the end of the taxable year.) 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.
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 decreases 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. A Fund may not make loans
in excess of 33 1/3% of the value of its total assets.
Borrowing Money
The Funds are permitted to borrow to the extent permitted under the
Investment Company Act of 1940 (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 1/3% 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. No Fund will
make any additional investments while borrowings exceed 5% of its total assets.
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) 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 and Appendix "A" for a
list of commercial paper ratings.
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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. Repurchase agreements subject to demand are deemed to have a
maturity equal to the notice period.
Mutual funds do not typically hold a significant amount of 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.
The Funds may purchase securities which are not registered under the
Securities Act but which may be sold to "qualified institutional buyers" in
accordance with Rule 144A under the Securities Act. These securities will not
be considered illiquid so long as it is determined by the Fund's adviser that an
adequate trading market exists for the securities. This investment practice
could have the effect of increasing the level of illiquidity in a Fund during
any period that qualified institutional buyers become uninterested in purchasing
restricted securities.
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, among others, 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).
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Depositary Receipts
The Funds' assets may be invested in the securities of foreign issuers 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 participation 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.
European Currency Unification
Many European countries are in the process of adopting a single European
currency, the "euro". On January 1, 1999, the euro became legal tender for all
countries participating in the Economic and Monetary Union ("EMU"). A new
European Central Bank was created to manage the monetary policy of the new
unified region. On the same date, the exchange rates were irrevocably fixed
between the EMU member countries. National currencies will continue to
circulate until they are replaced by euro coins and bank notes by the middle of
2002.
These changes are likely to significantly impact the European capital
markets in which the Funds may invest and may result in a Fund facing additional
risks in pursuing its investment objective. These risks, which include, but are
not limited to, uncertainty as to the proper tax treatment of the currency
conversion, volatility of currency exchange rates as a result of the conversion,
uncertainty as to capital market reaction, conversion costs that may affect
issuer profitability and creditworthiness, and lack of participation by some
European countries, may increase the volatility of a Fund's net asset value per
share.
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. The Funds will only invest in securities of other investment
companies which are purchased on the open market with no commission or profit to
a sponsor or dealer, other than the customary brokers commission, or when the
purchase is part of a plan of merger, consolidation, reorganization or
acquisition.
-11-
<PAGE>
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.
Debt Securities
The Funds may invest in debt securities rated no less than investment grade
by either Standard & Poor's Ratings Services ("S&P") or Moody's Investors
Service, Inc. ("Moody's"). Bonds in the lowest investment grade debt category
(e.g., bonds rated BBB by S&P or Baa by Moody's) 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 will not retain a
bond that was rated as investment grade at the time of purchase but whose rating
is subsequently downgraded below investment grade. The value of debt securities
held by a Fund will tend to vary inversely in relation to changes in prevailing
interest rates. Thus, if interest rates have increased from the time a debt
security was purchased, such security, if sold, might be sold at a price less
than its cost. Conversely, if interest rates have declined from the time a debt
security was purchased, the debt security, if sold, might be sold at a price
greater than its cost.
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.
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, Federal Home Loan Mortgage Corporation,
Federal Intermediate Credit Banks, and the Maritime Administration.
Repurchase Agreements
The Funds may agree to purchase securities from financial institutions
subject to the seller's agreement to repurchase them at an agreed-upon time and
price ("repurchase agreements"). The financial institutions with whom the Funds
may enter into repurchase agreements will be banks and broker/dealers which
Numeric considers creditworthy pursuant to criteria approved by the Board of
Directors. Numeric will consider, among other things, whether a repurchase
obligation of a seller
-12-
<PAGE>
involves minimal credit risk to a Fund in determining whether to have the Fund
enter into a repurchase agreement. The seller under a repurchase agreement will
be required to maintain the value of the securities subject to the agreement at
not less than the repurchase price plus accrued interest. Numeric will mark to
market daily the value of the securities and will, if necessary, require the
seller to maintain additional securities, to ensure that the value is not less
than the repurchase price. Default by or bankruptcy of the seller would,
however, expose a Fund to a possible loss because of adverse market action or
delays in connection with the disposition of the underlying obligations.
The repurchase price under repurchase agreements 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 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
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.
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.
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
-13-
<PAGE>
which invest substantially all of their assets on a long-term basis, and
correspondingly larger brokerage charges and other transaction costs can be
expected to be borne by the Funds. Investment strategies which require periodic
changes to portfolio holdings with the expectation of outperforming equity
indices are called "active" strategies. These compare with "passive" or "index"
strategies which hold only the stocks in the equity indices. Passive strategies
trade infrequently -- only as the indices change. Most equity mutual funds,
including the Funds, pursue active strategies, which have higher turnover than
passive strategies.
High portfolio turnover (100% or more) can adversely affect taxable
investors, especially those in higher marginal tax brackets, in two ways:
First, short term capital gains, which are a by-product or high turnover
investment strategies, are currently taxed at rates comparable to ordinary
income rates. Ordinary income tax rates are higher than long term capital gain
tax rates for middle and upper income taxpayers. Second, the frequent
realization of gains, which causes taxes to be paid frequently, is less
advantageous than infrequent realization of gains. Infrequent realization of
gains allows the payment of taxes to be deferred to later years, allowing more
of the gains to compound before taxes are paid. Consequently after-tax compound
rates of return will generally be higher for taxable investors using investment
strategies with very low turnover, all else being equal.
Although tax considerations should not typically drive an investment
decision, investors should consider their ability to allocate tax-deferred (such
as IRAs and 401(k) plans) versus taxable assets when considering where to
invest. All else being equal, investors will earn better returns investing tax-
deferred assets in active strategies, while using lower turnover passive
strategies for taxable investments. For further information, see "Taxes" below.
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.
* * *
The Funds' investment objectives and policies described above may be
changed by RBB's Board of Directors without shareholder approval. Shareholders
will be provided 30 days prior written notice of any change in a Fund's
investment objectives. There is no assurance that the investment objective of
the Funds will be achieved.
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
1940 Act). As used in this Statement of Additional Information and in the
Prospectus, "shareholder approval" and a "majority of the outstanding shares" of
a class, series or Fund means, with respect to the approval of an investment
advisory agreement, a distribution plan or a change in a fundamental investment
limitation, the lesser of (1) 67% of the shares of the particular class, series
or Fund represented at a meeting at which the holders of more than 50% of the
outstanding shares of such class, series or Fund are present in
-14-
<PAGE>
person or by proxy, or (2) more than 50% of the outstanding shares of such
class, series or Fund. 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 1/3% 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.
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
-15-
<PAGE>
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 2
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 under one of the Fund's investment policies or
limitations or the use of assets is adhered to at the time a transaction is
effected, later changes in percentage resulting from changing values will not be
considered a violation (except with respect to any restrictions that may apply
to borrowings or senior securities issued by the Fund).
-16-
<PAGE>
MANAGEMENT OF THE COMPANY
Directors and Officers
The directors and executive officers of RBB, their ages, business addresses
and principal occupations during the past five years are:
<TABLE>
<CAPTION>
Position Principal Occupation
Name, Address and Age with RBB During Past Five Years
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C>
*Arnold M. Reichman - 50 Director Chief Operating Officer of Credit Suisse (formerly
466 Lexington Avenue Warburg Pincus) Asset Management, Inc.; Executive
12/th/ Floor Officer and Director of Counsellors Securities Inc.;
New York, NY 10017 Director/Trustee of various investment companies
advised by Warburg Pincus Asset Management, Inc.;
Prior to 1997, Managing Director of Warburg Pincus
Asset Management, Inc.
*Robert Sablowsky - 60 Director Senior Vice President of Fahnestock Co., Inc. (a
Fahnestock & Company, Inc. registered broker-dealer); Prior to October 1996,
125 Broad Street Executive Vice President of Gruntal & Co., Inc. (a
New York, NY 10004 registered broker-dealer)
Francis J. McKay - 62 Director Since 1963, Executive Vice President, Fox Chase
Fox Chase Cancer Institute Cancer Center (biomedical research and medical care).
7701 Burholme Avenue
Philadelphia, PA 19111
Marvin E. Sternberg - 64 Director Since 1974, Chairman, Director and President, Moyco
Moyco Technologies, Inc. Industries, Inc. (manufacturer of dental supplies and
200 Commerce Drive precision coated abrasives).
Montgomeryville, PA 18936
Julian A. Brodsky - 65 Director Director and Vice Chairman, since 1969 Comcast
1500 Market Street Corporation (cable television and communications);
35th Floor Director, Comcast U.K.
Philadelphia, PA 19102
Donald van Roden - 74 Director and Self-employed businessman. From February 1980 to
1200 Old Mill Lane Chairman of March 1987, Vice Chairman, SmithKline Beecham
Wyomissing, PA 19610 the Board Corporation (pharmaceuticals); Director AAA
Mid-Atlantic (auto service); Director, Keystone
Insurance Co.
</TABLE>
-17-
<PAGE>
<TABLE>
<CAPTION>
Position Principal Occupation
Name, Address and Age with RBB During Past Five Years
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Edward J. Roach - 74 President and Certified Public Accountant; Vice Chairman of the
Suite 100 Treasurer Board, Fox Chase Cancer Center; Trustee Emeritus,
Bellevue Park Corporate Pennsylvania School for the Deaf; Trustee Emeritus,
Center Immaculata College; President and Treasurer of
400 Bellevue Parkway Municipal Fund for New York Investors, Inc. (advised
Wilmington, DE 19809 by BlackRock Institutional Management); Vice
President and Treasurer of various investment
companies advised by BlackRock Institutional
Management Corporation; Treasurer of the Chestnut
Street Exchange Fund.
Morgan R. Jones - 59 Secretary Chairman, law firm of Drinker Biddle & Reath LLP;
Drinker Biddle & Reath LLP Director, Nobel Learning Communities, Inc.;
One Logan Square Secretary, Petroferm, Inc.
18/th/ and Cherry Streets
Philadelphia, PA 19103
</TABLE>
* Each of Mr. Sablowsky and Mr. Reichman is an "interested person" of RBB, as
that term is defined in the 1940 Act, by virtue of his position with
Fahnestock Co., Inc. and Counsellors Securities Inc., respectively, each a
registered broker-dealer.
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 all persons to be nominated as directors of RBB.
Directors' Compensation
RBB pays directors who are not "affiliated persons" (as that term is
defined in the 1940 Act) of any investment adviser or sub-adviser of the Fund or
the Distributor and Mr. Sablowsky, who is considered to be an affiliated person,
$12,000 annually and $1,250 per meeting of the Board or any committee thereof
that is not held in conjunction with a Board meeting. In addition, the Chairman
of the Board receives an additional fee of $6,000 per year for his services in
this capacity. Directors are reimbursed for any expenses incurred in attending
meetings of the Board of Directors or any committee thereof. For the year ended
August 31, 1999, each of the following members of the Board of Directors
received compensation from RBB in the following amounts:
-18-
<PAGE>
<TABLE>
<CAPTION>
Aggregate Pension or Retirement
Compensation from Benefits Accrued as Estimated Annual Benefits
Name of Person/Position Registrant Part of Fund Expenses Upon Retirement
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Julian A. Brodsky, Director $___ N/A N/A
Francis J. McKay, Director $___ N/A N/A
Arnold M. Reichman, Director $ 0 N/A N/A
Robert Sablowsky, Director $___ N/A N/A
Marvin E. Sternberg, Director $___ N/A N/A
Donald van Roden, Director $___ N/A N/A
and Chairman
</TABLE>
On October 24, 1990, RBB adopted, as a participating employer, the Fund
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
quarterly basis amounts equal to 10% of the quarterly compensation of each
eligible employee. By virtue of the services performed by RBB's advisers,
custodians, administrators and distributor, RBB itself requires only one part-
time employee. Drinker Biddle & Reath LLP, of which Mr. Jones is a partner,
receives legal fees as counsel to RBB. No officer, director or employee of
Numeric or the Distributor currently receives any compensation from RBB.
CONTROL PERSONS
As of September 7, 1999, (except with respect to the Bedford Municipal
Money Market Fund and Bedford Government Obligations Fund for which information
is provided as of September 3, 1999 and September 8, 1999, respectively) to the
Company'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 the Company indicated below. See "Additional Information Concerning
Fund Shares" above. The Company does not know whether such persons also
beneficially own such shares.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
FUND NAME SHAREHOLDER NAME AND PERCENTAGE OF
ADDRESS FUND HELD
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
BEDFORD MUNICIPAL MONEY Gabe Nechamkin 16.7%
MARKET 27 Muchmore Road
Harrison, NY 10528-1109
- ------------------------------------------------------------------------------------------------
BEDFORD GOVERNMENT St. Dominic Health Service Improvement Fund 6.3%
OBLIGATIONS FUND D/NOYES
Attn: Frank Quiriconi
969 Lakeland Drive
Jackson, MS 39216-4602
- ------------------------------------------------------------------------------------------------
CASH PRESERVATION MONEY Harold T. Erfer 6.645%
MARKET 414 Charles Ln.
Wynnewood, PA 19096
- ------------------------------------------------------------------------------------------------
Marian E. Kunz 16.328%
52 Weiss Ave.
Flourtown, PA 19031
- ------------------------------------------------------------------------------------------------
</TABLE>
-19-
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
FUND NAME SHAREHOLDER NAME AND PERCENTAGE OF
ADDRESS FUND HELD
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
Karen M. McElhinny and Contribution Account 8.611%
4943 King Arthur Dr.
Erie, PA 16506
- ------------------------------------------------------------------------------------------------
Luanne M. Garvey and Robert J. Garvey 13.465%
2729 Woodland Ave.
Trooper, PA 19403
- ------------------------------------------------------------------------------------------------
John Robert Estrada and Shirley Ann Estrada 5.594%
1700 Raton Dr.
Arlington, TX 76018
- ------------------------------------------------------------------------------------------------
Dominic and Barbara Pisciotta and Successors 13.381%
in Tr. Under the Dominic Trst. And Barbara
Pisciotta Caring Tr. Dtd. 01/24/92
207 Woodmere Way
St. Charles, MO 63303
- ------------------------------------------------------------------------------------------------
Michael W. Preble 8.576%
1505 W. Cheyenne Dr.
Chandler, AZ 85224
- ------------------------------------------------------------------------------------------------
SAMSON STREET MONEY MARKET Saxon and Co. 76.270%
FBO Paine Webber
A/C 32 32 400 4000038
P.O. Box 7780 1888
Phila., PA 19182
- ------------------------------------------------------------------------------------------------
Saxon and Co. 23.730%
c/o PNC Bank, N. A.
F3-F076-02-2
200 Stevens Drive Ste. 260/ACI
Lester, PA 19113
- ------------------------------------------------------------------------------------------------
CASH PRESERVATION Gary L. Lange 76.032%
MUNICIPAL MONEY MARKET and Susan D. Lange
JT TEN
837 Timber Glen Ln.
Ballwin, Mo 63021-6066
- ------------------------------------------------------------------------------------------------
RBB SELECT MONEY MARKET Warburg Pincus Capital Appreciation Fund 15.247%
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
Warburg Pincus Emerging Growth Fund 30.420%
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
</TABLE>
-20-
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
FUND NAME SHAREHOLDER NAME AND PERCENTAGE OF
ADDRESS FUND HELD
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
Warburg Pincus Growth & Income Fund 5.866%
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
Warburg Pincus Trust Small Company Growth 14.434%
Portfolio
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
Warburg Pincus Trust-International Equity 5.161%
Portfolio
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
Warburg Pincus Japan Small Company Fund 13.276%
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
N/I MICRO CAP FUND Charles Schwab & Co. Inc 13.705%
Special Custody Account for the Exclusive
Benefit of Customers
Attn: Mutual Funds A/C 3143-0251
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
Janis Claflin, Bruce Fetzer and 10.725%
Winston Franklin
Robert Lehman Trst.
The John E. Fetzer Institute, Inc.
U/A DTD 06-1992
Attn: Christina Adams
9292 West KL Ave.
Kalamazoo, MI 49009
- ------------------------------------------------------------------------------------------------
Louisa Stude Sarofim Foundation 5.715%
DTD. 01/04/91
c/o Nancy Head
1001 Fannin 4700
Houston, TX 77002
- ------------------------------------------------------------------------------------------------
Public Inst. For Social Security 15.038%
1001 19th St., N. 16th Flr.
Arlington, VA 22209
- ------------------------------------------------------------------------------------------------
</TABLE>
-21-
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
FUND NAME SHAREHOLDER NAME AND PERCENTAGE OF
ADDRESS FUND HELD
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
N/I GROWTH FUND Charles Schwab & Co. Inc 7.211%
Special Custody Account for the Exclusive
Benefit of Customers
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
Citibank North America Inc. 39.964%
Trst. Sargent & Lundy Retirement Trust
DTD. 06/01/96
Mutual Fund Unit
Bld. B Floor 1 Zone 7
3800 Citibank Center Tampa
Tampa, FL 33610-9122
- ------------------------------------------------------------------------------------------------
Louisa Stude Sarofim Foundation 5.804%
c/o Nancy Head
DTD. 01/04/91
1001 Fannin 4700
Houston, TX 77002
- ------------------------------------------------------------------------------------------------
The John E. Fetzer Institute, Inc. 5.279%
Attn. Christina Adams
9292 W. KL Ave.
Kalamazoo, MI 49009
- ------------------------------------------------------------------------------------------------
U.S. Equity Investment Portfolio LP 10.152%
1001 N. US Hwy. One Suite 800
Jupiter, FL 33477
- ------------------------------------------------------------------------------------------------
N/I GROWTH AND VALUE FUND Charles Schwab & Co. Inc. 21.083%
Special Custody Account for the Exclusive
Benefit of Customers
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
National Investors Services Corp. 7.419%
For the Exclusive Benefit of our Customers
S. 55 Water St. 32/nd/ Floor
New York, NY 10041-3299
- ------------------------------------------------------------------------------------------------
N/I LARGER CAP VALUE FUND Charles Schwab & Co. Inc 49.045%
Special Custody Account for the Exclusive
Benefit of Customers
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
</TABLE>
-22-
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
FUND NAME SHAREHOLDER NAME AND PERCENTAGE OF
ADDRESS FUND HELD
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
FTC & Co. 9.119%
Attn: Datalynx 241
Attn: Datalynx 273
P. O. Box 173736
Denver, CO 80217-3736
- ------------------------------------------------------------------------------------------------
NFSC FEBO 108-436631 9.896%
FMT c/o Cust. IRA Rollover
FBO Warren E. Shaw
84 Rye Rd.
Rye, NY 10580
- ------------------------------------------------------------------------------------------------
N/I SMALL CAP VALUE FUND State Street Bank and Trust Company 53.794%
FBO Yale Univ. Ret. Pl. for Staff Emp.
State Street Bank & Tr. Co. Master Tr. Div.
Attn: Kevin Sutton
Solomon Williard Bldg.
One Enterprise Dr.
North Quincy, MA 02171
- ------------------------------------------------------------------------------------------------
Yale University 26.757%
Trst. Yale University Ret. Health Bene. Tr.
Attention: Seth Alexander
230 Prospect St.
New Haven, CT 06511
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS LARGE CAP Shady Side Academy Endowment 5.426%
FUND INST SHARES 423 Fox Chapel Rd.
Pittsburgh, PA 15238
- ------------------------------------------------------------------------------------------------
Charles Schwab & Co., Inc. 7.016%
Special Custody Account for Bene. of Cust.
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
Swanee Hunt and Charles Ansbacher 16.498%
Trst.
The Hunt Alternatives Fund
C/o Elizabeth Alberti
168 Brattle St.
Cambridge, MA 02138
- ------------------------------------------------------------------------------------------------
Union Bank of California 9.292%
FBO Service Employees BP 610001265-01
P. O. Box 85484
San Diego, CA 92186
- ------------------------------------------------------------------------------------------------
</TABLE>
-23-
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
FUND NAME SHAREHOLDER NAME AND PERCENTAGE OF
ADDRESS FUND HELD
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
US Bank National Association 16.898%
FBO A-Dec Inc. DOT 093098
Attn: Mutual Funds A/C 97307536
P. O. Box 64010
St. Paul, MN 55164-0010
- ------------------------------------------------------------------------------------------------
Northern Trust Company 16.038%
FBO AEFC Pension Trust
A/C 22-53582
P. O. Box 92956
Chicago, IL 60675
- ------------------------------------------------------------------------------------------------
James B. Beam 5.017%
Trst World Publishing Co. Pft Shr Trust
P.O. Box 1511
Wenatchee, WA 98807
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS LARGE CAP Charles Schwab & Co. Inc. 65.878%
FUND INVESTOR SHARES Special Custody Account for Bene. of Cust.
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
Jupiter & Co. 6.743%
c/o Investors Bank
PO Box 9130 FPG90
Boston, MA 02110
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS MID CAP MAC & CO. 5.560%
VALUE FUND INST. SHARES A/C CHIF1001182
FBO Childrens Hospital LA
P.O. Box 3198
Pittsburgh, PA 15230-3198
- ------------------------------------------------------------------------------------------------
John M. Pontius, Jr. 6.142%
FBO Hartwick College
West Street
Queens, NY 13820
- ------------------------------------------------------------------------------------------------
MAC & CO. 7.859%
A/C LEMF5044062
Mutual Funds Operations
P.O. Box 3198
Pittsburgh, PA 15230-3198
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS MID CAP National Financial Svcs. Corp. for Exclusive 16.139%
VALUE FUND INV SHARES Bene. of Our Customers
Sal Vella
200 Liberty St.
New York, NY 10281
- ------------------------------------------------------------------------------------------------
</TABLE>
-24-
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
FUND NAME SHAREHOLDER NAME AND PERCENTAGE OF
ADDRESS FUND HELD
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
Charles Schwab & Co. Inc. 50.979%
Special Custody Account for Bene. of Cust.
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS BOND FUND Boston Partners Asset Mgmt. L. P. 26.541%
INSTITUTIONAL SHARES Attn: Jan Penney
28 State St.
Boston, MA 02109
- ------------------------------------------------------------------------------------------------
Chiles Foundation 8.524%
111 S.W. Fifth Ave.
Ste. 4050
Portland, OR 97204
- ------------------------------------------------------------------------------------------------
The Roman Catholic Diocese of 53.537%
Raleigh, NC
General Endowment
715 Nazareth St.
Raleigh, NC 27606
- ------------------------------------------------------------------------------------------------
The Roman Catholic Diocese of 11.355%
Raleigh, NC
Clergy Trust
715 Nazareth St.
Raleigh, NC 27606
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS BOND FUND Charles Schwab & Co. Inc 81.125%
INVESTOR SHARES Special Custody Account for Bene. of Cust.
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
Stephen W. Hamilton 16.094%
17 Lakeside Ln.
N. Barrington, IL 60010
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS Desmond J. Heathwood 8.330%
MICRO CAP VALUE 41 Chestnut St.
FUND- INSTITUTIONAL Boston, MA 02108
SHARES
- ------------------------------------------------------------------------------------------------
Boston Partners Asset Mgmt. L. P. 65.899%
Attn: Jan Penney
28 State St.
Boston, MA 02109
- ------------------------------------------------------------------------------------------------
Wayne Archambo 6.623%
42 DeLopa Circle
Westwood, MA 02090
- ------------------------------------------------------------------------------------------------
</TABLE>
-25-
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
FUND NAME SHAREHOLDER NAME AND PERCENTAGE OF
ADDRESS FUND HELD
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
David M. Dabora 6.623%
11 White Plains Ct.
San Anselmo, CA 94960
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS National Financial Services Corp. 30.999%
MICRO CAP VALUE For the Exclusive Bene. of our Customers
FUND- INVESTOR Attn: Mutual Funds 5/th/ Floor
SHARES 200 Liberty St.
1 World Financial Center
New York, NY 10281
- ------------------------------------------------------------------------------------------------
Charles Schwab & Co., Inc. 26.623%
Special Custody Account for Bene. of Cust.
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
Scott J. Harrington 30.382%
54 Torino Ct.
Danville, CA 94526
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS MARKET Boston Partners Asset Mgmt. L. P. 100.000%
NEUTRAL FUND- Attn: Jan Penney
INSTITUTIONAL SHARES 28 State St.
Boston, MA 02109
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS MARKET Glenn P. Verrette and Laurie Jo Verrette 6.703%
NEUTRAL FUND- INVESTOR Jt. Ten. Wros.
SHARES 156 Osgood St.
Andover, MA 01810
- ------------------------------------------------------------------------------------------------
Thomas Lannan and Kathleen Lannan 89.967%
Jt. Ten. Wros.
P. O. Box 312
Osterville, MA 02655
- ------------------------------------------------------------------------------------------------
SCHNEIDER SMALL CAP VALUE Arnold C. Schneider III 13.768%
FUND SEP IRA
826 Turnbridge Rd.
Wayne, PA 19087
- ------------------------------------------------------------------------------------------------
SCM Retirement Plan 5.276%
Profit Sharing Plan
460 E. Swedesford Rd. Ste. 1080
Wayne, PA 19087
- ------------------------------------------------------------------------------------------------
Ronald L. Gault 5.451%
IRA
439 W. Nelson St.
Lexington VA 24450
- ------------------------------------------------------------------------------------------------
John Frederick Lyness 13.089%
81 Hillcrest Ave.
Summit, NJ 07901
- ------------------------------------------------------------------------------------------------
</TABLE>
-26-
<PAGE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
FUND NAME SHAREHOLDER NAME AND PERCENTAGE OF
ADDRESS FUND HELD
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
Mark Shevitz 7.276%
Rollover IRA
65 Wardell St.
Rumson, NJ 07760
- ------------------------------------------------------------------------------------------------
</TABLE>
As of September 7, 1999, the directors and officers as a group owned less
than 1% of RBB's Shares.
INVESTMENT ADVISORY, DISTRIBUTION
AND SERVICING ARRANGEMENTS
Advisory Agreements
Numeric renders advisory services to the Funds pursuant to Investment
Advisory Agreements. The Advisory Agreements relating to each of the Funds are
dated April 24, 1996, except for the Larger Cap Value Fund, which is dated
December 1, 1997, and the Small Cap Value Fund, which is dated November 30,
1998. Under the Advisory Agreements, 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. Until December 31, 2000, Numeric has agreed 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 thereafter.
[Until January 1, 2001, Numeric is entitled to a management fee of 0.75% of
the Fund's average daily net assets. Thereafter, Numeric is entitled to a
performance based fee calculated at the end of each month using a basic fee of
0.85% of average daily net assets and a performance fee adjustment based upon
the Fund's performance during the last rolling 12 month period. The current fee
of 0.75% would only increase if performance exceeds benchmark by more than 4% in
a given 12-month period and would be less than the current fee if performance
does not exceed benchmark by 3% in a given 12-month period.]
[Under this arrangement, the investment advisory fee would never be greater
than 1.35% nor less than 0.35% of a Fund's average daily net assets for the
preceding month. The table below details the performance based fee
arrangements.]
<TABLE>
<CAPTION>
[Percentage Difference Between
Fund Performance (Net of
Expenses Including Advisory Performance
Fees) and Percentage Change in Basic Adjustment Total
Benchmark Index Fee Rate Advisory Fee
--------------- --- ---- ------------
<S> <C> <C> <C>
+9% or more...................... .85% .50% 1.35%
+8% or more but less than +9%.... .85% .40% 1.25%
+7% or more but less than +8%.... .85% .30% 1.15%
</TABLE>
-27-
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
+6% or more but less than +7%.... .85% .20% 1.05%
+5% or more but less than +6%.... .85% .10% 0.95%
+4% or more but less than +5%.... .85% None 0.85%
+3% or more but less than +4%.... .85% -.10% 0.75%
+2% or more but less than +3%.... .85% -.20% 0.65%
+1% or more but less than +2%.... .85% -.30% 0.55%
+0% or more but less than +1%.... .85% -.40% 0.45%
Less than 0%..................... .85% -.50% 0.35%]
</TABLE>
For the fiscal years ended August 31, 1997, 1998 and 1999, the Funds paid
Numeric advisory fees and Numeric waived advisory fees as follows:
<TABLE>
<CAPTION>
Advisory Fees Paid (after
waivers and
Fund reimbursements) Waivers Reimbursements
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Fiscal year ended August 31, 1999
Micro Cap $ $ $
Growth $ $ $
Mid Cap $ $ $
Larger Cap Value $ $ $
Small Cap Value* $ $ $
Fiscal year ended August 31, 1998
Micro Cap $912,750 $140,740 $ 0
Growth $782,298 $121,746 $ 0
Mid Cap $675,595 $136,503 $ 0
Larger Cap Value** $ 35,168 $ 46,328 $30,869
Fiscal year ended August 31, 1997
Micro Cap $248,284 $120,320 $ 0
Growth $355,843 $153,302 $ 0
Mid Cap $ 90,762 $ 92,307 $21,893
</TABLE>
* The Small Cap Value Fund commenced operations on November 30, 1998.
** The Larger Cap Value Fund commenced operations on December 9, 1997.
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 expenses listed in the prospectus and 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)
expenses of organizing RBB that are
-28-
<PAGE>
not attributable to a class of RBB; (c) 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; (d) any extraordinary expenses; (e) fees,
voluntary assessments and other expenses incurred in connection with membership
in investment company organizations; (f) costs of mailing and tabulating proxies
and costs of shareholders' and directors' meetings; and (g) 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 Agreements, 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 Agreement, 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 Agreements for the Micro Cap, Growth and Mid Cap Funds 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 Agreements or
interested persons (as defined in the 1940 Act) of such parties. The Advisory
Agreement for the Larger Cap Value Fund was similarly approved on October 15,
1997. The Advisory Agreement for the Small Cap Value Fund was similarly
approved on October 28, 1998. The Advisory Agreements 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 Agreements for the Micro Cap, Growth and Mid
Cap Funds became effective on May 20, 1996 and were approved by written consent
of the sole shareholder of each of the Micro Cap, Growth and Mid Cap Funds on
May 28, 1996. The Advisory Agreement for the Larger Cap Value Fund became
effective on December 1, 1997 and was approved by written consent of the sole
shareholder of the Fund on December 1, 1997. The Advisory Agreement for the
Small Cap Value Fund became effective on November 30, 1998 and was approved by
written consent of the sole shareholder of the Fund on November 30, 1998. The
Advisory Agreements terminate automatically in the event of assignment thereof.
The Advisory Agreements provide that Numeric shall at all times have all
rights in and to each Fund's name and all investment models used by or on behalf
of the Funds. Numeric may use each Fund's name or any portion thereof in
connection with any other mutual fund or business activity without the consent
of any shareholder, and RBB has agreed to execute and deliver any and all
documents required to indicate its consent to such use.
The Advisory Agreements further provide that no public reference to, or
description of, Numeric or its methodology or work shall be made by RBB, whether
in the Prospectus, Statement of Additional Information or otherwise, without the
prior written consent of Numeric, which consent shall not be unreasonably
withheld. In each case, RBB has agreed to provide Numeric a reasonable
opportunity to review any such reference or description before being asked for
such consent.
-29-
<PAGE>
Custodian Agreements
Custodial Trust Company ("CTC") is custodian of the Funds' assets pursuant
to custodian agreements dated as of May 20, 1996, as amended (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 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 at .03% of each Fund's
average daily net assets.
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, as supplemented (collectively, the "Transfer Agency
Agreement"). Under the Transfer Agency Agreement, PFPC (a) issues and redeems
Shares of each of the Funds, (b) addresses and mails all communications by the
Funds to record owners of shares of the Funds, 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 Funds. For its services to the Funds under the
Transfer Agency Agreement, PFPC receives a fee at the annual rate of $10 per
account for the Funds, exclusive of out-of-pocket expenses, and also receives
reimbursement of its out-of-pocket expenses.
Co-Administration Agreements
Bear Stearns Funds Management Inc. ("BSFM") serves as co-administrator to
the Funds pursuant to Co-Administration Agreements dated April 24, 1996, as
amended, 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 the first $150 million of each Fund's average daily
net assets and .02% on all assets above $150 million.
PFPC also serves as co-administrator to Funds pursuant to Co-Administration
Agreements dated as of April 24, 1996, as amended (the "PFPC Co-Administration
-30-
<PAGE>
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
.125% of each Fund's average daily net assets, exclusive of out-of-pocket
expenses and pricing charges. PFPC is currently waiving fees in excess of .115%
of each Fund's average daily net assets.
-31-
<PAGE>
For the fiscal years ended August 31, 1997, 1998 and 1999, the Funds paid
administration fees to PFPC and BSFM, and PFPC waived administration fees as
follows:
<TABLE>
<CAPTION>
Co-Administration Fees
Fund Paid (After Waivers) Waivers Reimbursements
- -------------------------------------------------------------------------------------------------------------------
For the fiscal year ended August 31, 1999.
(PFPC)
- -----
<S> <C> <C> <C>
Micro Cap $ $ $
Growth $ $ $
Mid Cap $ $ $
Larger Cap Value $ $ $
Small Cap Value* $ $ $
(BSFM)
- -----
Micro Cap $ $ $
Growth $ $ $
Mid Cap $ $ $
Larger Cap Value $ $ $
Small Cap Value* $ $ $
For the fiscal year ended August 31, 1998
(PFPC)
- -----
Micro Cap $161,535 $14,047 $0
Growth $138,620 $12,054 $0
Mid Cap $124,522 $11,179 $0
Larger Cap Value** $ 27,114 $27,119 $0
(BSFM)
- -----
Micro Cap $ 70,233 $ 0 $0
Growth $ 60,270 $ 0 $0
Mid Cap $ 54,025 $ 0 $0
Larger Cap Value** $ 5,433 $ 0 $0
For the fiscal year ended August 31, 1997.
(PFPC)
- -----
Micro Cap $ 61,461 $26,117 $0
Growth $ 73,540 $20,169 $0
Mid Cap $ 39,724 $35,276 $0
(BSFM)
- -----
Micro Cap $ 24,574 $ 0 $0
Growth $ 33,943 $ 0 $0
Mid Cap $ 12,203 $ 0 $0
</TABLE>
* The Small Cap Value Fund commenced operations on November 30, 1998.
** The Larger Cap Value Fund commenced operations on December 9, 1997.
Administrative Services Agent
Provident Distributors, Inc. ("PDI") provides certain administrative
services to the Funds that are not provided by BSFM or PFPC. These services
include furnishing data processing and clerical services, acting as liaison
between the Funds and various service providers and coordinating the preparation
of proxy statements and annual, semi-annual and quarterly reports. As
compensation for such administrative services, PDI is entitled to a monthly fee
calculated at the annual rate of .15% of each Fund's average daily net assets.
PDI is currently waiving fees in excess of .03% of each fund's average daily net
assets for open funds and .02% of each closed
-32-
<PAGE>
fund's average daily net assets.
Prior to May 29, 1998, Counsellors Funds Service, Inc. ("Counsellors
Service"), a wholly-owned subsidiary of Warburg Pincus Asset Management, Inc.
("Warburg"), acted as Administrative Services Agent pursuant to the same
compensation arrangement as for PDI.
For the fiscal years ended August 31, 1997, 1998 and 1999, the Funds paid
administrative services fees to PDI and Counsellors Service, and PDI and
Counsellors Service waived administrative services fees as follows:
<TABLE>
<CAPTION>
Administrative Services
Fund Fees Paid (After Waivers) Waivers Reimbursements
- -------------------------------------------------------------------------------------------------------------------
For the fiscal year ended August 31, 1999
(PDI)
- ----
<S> <C> <C> <C>
Micro Cap $ $ $
Growth $ $ $
Mid Cap $ $ $
Larger Cap Value $ $ $
Small Cap Value* $ $ $
For the period from May 29, 1998 through August 31, 1998
(PDI)
- ----
Micro Cap $ 6,924 $ 44,172 $0
Growth $ 5,888 $ 37,315 $0
Mid Cap $11,064 $ 44,256 $0
Larger Cap Value** $ 1,919 $ 7,678 $0
For the period from September 1, 1997 through May 29, 1998
(Counsellors Service)
- --------------------
Micro Cap $31,920 $127,682 $0
Growth $27,521 $110,085 $0
Mid Cap $21,420 $ 85,680 $0
Larger Cap Value** $ 1,341 $ 5,361 $0
For the fiscal year ended August 31, 1997
(Counsellors Service)
- --------------------
Micro Cap $14,744 $ 58,977 $0
Growth $20,366 $ 81,463 $0
Mid Cap $ 7,323 $ 29,291 $0
</TABLE>
* The Small Cap Value Fund commenced operations on November 30, 1998.
** The Larger Cap Value Fund commenced operations on December 9, 1997.
Distributor
PDI serves as distributor of the Shares pursuant to the terms of a
distribution agreement dated as of June 25, 1999 (the "Distribution Agreement")
entered into by PDI and RBB. No compensation is payable by RBB to PDI for
distribution services with respect to the Funds. Counsellors Securities Inc.
("Counsellors") served as distributor of the Shares prior to May 29, 1998.
-33-
<PAGE>
FUND TRANSACTIONS
Subject to policies established by the Board of Directors and applicable
rules, 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 price and most favorable
execution 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 competitive commission rates, payment
of the lowest commission or spread is not necessarily consistent with obtaining
the best price and execution 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.
For the fiscal year ended August 31, 1999, the Funds paid aggregate
commissions to brokers on account of research services as follows:
<TABLE>
<CAPTION>
Fund Brokerage Commissions
---------------------------------------------
<S> <C>
Micro Cap $___
Growth $___
Mid Cap $___
Larger Cap Value $___
Small Cap Value $___
</TABLE>
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
-34-
<PAGE>
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.
In no instance will portfolio securities be purchased from or sold to PDI,
PNC Bank or Numeric or any affiliated person of the foregoing entities except as
permitted by SEC exemptive order or by applicable law.
For the fiscal years ended August 31, 1997, 1998 and 1999, the Funds paid
brokerage commissions on behalf of the Funds as follows:
<TABLE>
<CAPTION>
Aggregate
Commissions
Fund 1997 1998 1999
----------------------------------------------------------
<S> <C> <C> <C>
Micro Cap $___ $___ $___
Growth $___ $___ $___
Mid Cap $___ $___ $___
Larger Cap Value $___ $___ $___
Small Cap Value $___ $___ $___
</TABLE>
The Funds are required to identify any securities of RBB's regular broker
dealers (as defined in Rule 10b-1 under the 1940 Act) or their parents held by
the Funds as of the end of the most recent fiscal year. As of August 31, 1999,
the following Funds held the following securities:
<TABLE>
<CAPTION>
Fund Security Value
- -------------------------------------------------------------------------------
<S> <C> <C>
Mid Cap ______ $___
Larger Cap Value ______ $___
</TABLE>
-35-
<PAGE>
ADDITIONAL INFORMATION CONCERNING RBB SHARES
RBB has authorized capital of 30 billion shares of Common Stock at a par
value of $0.001 per share. Currently, 20.026 billion shares have been
classified into 99 classes as shown in the table below. Shares of the Classes
FF, GG, HH, XX and MMM Common Stock constitute the Micro Cap, Growth, Mid Cap,
Larger Cap Value and Small Cap Value Funds, respectively. Under RBB's charter,
the Board of Directors has the power to classify and reclassify any unissued
shares of Common Stock from time to time.
<TABLE>
<CAPTION>
Number of Number of
Authorized Authorized
Class of Common Stock Shares (millions) Class of Common Stock Shares (millions)
- -------------------------------------------------------------- -------------------------------------------------------------
<S> <C> <C> <C>
A (Growth & Income) 100 YY (Schneider Capital Small Cap Value) 100
B 100 ZZ 100
C (Balanced) 100 AAA 100
D (Tax-Free) 100 BBB 100
E (Money) 500 CCC 100
F (Municipal Money) 500 DDD (Boston Partners Institutional Micro
Cap) 100
G (Money) 500 EEE (Boston Partners Investors Micro Cap) 100
H (Municipal Money) 500 FFF 100
I (Sansom Money) 1500 GGG 100
J (Sansom Municipal Money) 500 HHH 100
K (Sansom Government Money) 500 III (Boston Partners Institutional
Market Neutral) 100
L (Bedford Money) 1500 JJJ (Boston Partners Investors Market
Neutral) 100
M (Bedford Municipal Money) 500 KKK (Boston Partners Institutional
Long-Short Equity) 100
N (Bedford Government Money) 500 LLL (Boston Partners Investors
Long-Short Equity) 100
O (Bedford N.Y. Money) 500 MMM (n/i numeric Small Cap Value) 100
P (RBB Government) 100 Class NNN (Bogle Institutional Small
Cap Growth) 100
Q 100 Class OOO (Bogle Investors Small Cap
Growth) 100
R (Municipal Money) 500 Janney (Money) 3000
S (Government Money) 500 Janney (Municipal Money) 200
T 500 Janney (Government Money) 700
U 500 Janney (N.Y. Money) 100
V 500 Select (Money) 700
W 100 Beta 2 (Municipal Money) 1
X 50 Beta 3 (Government Money) 1
Y 50 Beta 4 (N.Y. Money) 1
Z 50 Principal Class (Money) 700
AA 50 Gamma 2 (Municipal Money) 1
BB 50 Gamma 3 (Government Money) 1
CC 50 Gamma 4 (N.Y. Money) 1
DD 100 Delta 1 (Money) 1
EE 100 Delta 2 (Municipal Money) 1
FF (n/i numeric Micro Cap) 50 Delta 3 (Government Money) 1
</TABLE>
-36-
<PAGE>
<TABLE>
<CAPTION>
Number of Number of
Authorized Authorized
Class of Common Stock Shares (millions) Class of Common Stock Shares (millions)
- ------------------------------------------------------------ --------------------------------------------------------------
<S> <C> <C> <C>
GG (n/i numeric Growth) 50 Delta 4 (N.Y. Money) 1
HH (n/i numeric Mid Cap) Epsilon 1 (Money) 1
50
II 100 Epsilon 2 (Municipal Money) 1
JJ 100 Epsilon 3 (Government Money) 1
KK 100 Epsilon 4 (N.Y. Money) 1
LL 100 Zeta 1 (Money) 1
MM 100 Zeta 2 (Municipal Money) 1
NN 100 Zeta 3 (Government Money) 1
OO 100 Zeta 4 (N.Y. Money) 1
PP 100 Eta 1 (Money) 1
QQ (Boston Partners Institutional Eta 2 (Municipal Money) 1
Large Cap) 100
RR (Boston Partners Investors Large Eta 3 (Government Money) 1
Cap) 100
SS (Boston Partners Advisor Large Eta 4 (N.Y. Money) 1
Cap) 100
TT (Boston Partners Investors Mid Theta 1 (Money) 1
Cap) 100
UU (Boston Partners Institutional Theta 2 (Municipal Money) 1
Mid Cap) 100
VV (Boston Partners Institutional Theta 3 (Government Money) 1
Bond) 100
WW (Boston Partners Investors Bond) 100 Theta 4 (N.Y. Money) 1
XX (n/i numeric Larger Cap) 50
</TABLE>
The classes of Common Stock have been grouped into 16 separate "families":
the RBB Family, the Cash Preservation Family, the Sansom Street Family, the
Bedford Family, the Principal (Gamma) Family, the Janney Montgomery Scott
Family, the Select (Beta) Family, the Schneider Capital Management Family, the
n/i numeric family of funds, the Boston Partners Family, the Bogle Family, the
Delta Family, the Epsilon Family, the Zeta Family, the Eta Family, and the Theta
Family. The RBB Family represents interests in the Government Securities
Portfolio; 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; the Bedford Family represents interests in the Money
Market, Municipal Money Market, Government Obligations Money Market and New York
Municipal Money Market Portfolios; the n/i numeric investors family of funds
represents interests in five non-money market portfolios; the Boston Partners
Family represents interests in six non-money market portfolios; the Bogle Family
represents interests in one non-money market portfolio; the Schneider Capital
Management Family represents interests in one non-money market portfolio; the
Janney Montgomery Scott Family, the Select (Beta) Family, the Principal (Gamma)
Family and the 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.
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
-37-
<PAGE>
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 voting 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
voting securities, as defined in the 1940 Act, 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 (as defined in the 1940 Act) of such portfolio.
However, the Rule also provides that the ratification of the selection of
independent public accountants 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 Articles of Incorporation, 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). The name "n/i numeric investors" may be used in the name of other
portfolios managed by Numeric.
PURCHASE AND REDEMPTION INFORMATION
The Funds reserve the right, if conditions exist that 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
-38-
<PAGE>
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.)
In addition to the situations described in the Prospectus, a Fund may
redeem shares involuntarily to reimburse such Fund for any loss sustained by
reason of the failure of a shareholder to make full payment for shares purchased
by the shareholder or to collect any charge relating to a transaction effected
for the benefit of a shareholder as provided in the Prospectus from time to
time.
An illustration of the computation of the public offering price per share
of each of the Funds, based on the value of the Funds' respective net assets as
of August 31, 1999, is as follows:
<TABLE>
<CAPTION>
Larger Cap Small Cap
Micro Cap Growth Mid Cap Value Value
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net assets $___ $___ $___ $___ $___
Outstanding shares $___ $___ $___ $___ $___
Net asset value per share $___ $___ $___ $___ $___
Maximum sales charge -- -- -- -- --
Maximum Offering Price to
Public $___ $___ $___ $___ $___
</TABLE>
VALUATION OF SHARES
The net asset value per share of each Fund is calculated as of the close of
regular trading on the NYSE (generally 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, Dr. Martin Luther King, Jr. Day, Presidents'
Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day
and Christmas Day and on the preceding Friday or subsequent Monday when one of
those holidays falls on a Saturday or Sunday. 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 the close of regular trading (generally 4:00
p.m. Eastern Time); 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. Net asset value per share is
calculated by adding the value of each Fund's securities, cash and other
-39-
<PAGE>
assets, subtracting the actual and accrued liabilities of the Fund, and dividing
the result by the number of outstanding shares of the Fund.
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.
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 = 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.
The formula for calculating aggregate total return is as follows:
ERV
Aggregate Total Return = [(----) - 1]
P
-40-
<PAGE>
The calculations are made assuming that (1) all dividends and capital gain
distributions are reinvested on the reinvestment dates at the price per share
existing on the reinvestment date, (2) all recurring fees charged to all
shareholder accounts are included, and (3) for any account fees that vary with
the size of the account, a mean (or median) account size in the Fund during the
periods is reflected. The ending redeemable value (variable "ERV" in the
formula) is determined by assuming complete redemption of the hypothetical
investment after deduction of all non-recurring charges at the end of the
measuring period.
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 greater 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.
Calculated according to the SEC Rules, the average annual total return for
the Funds was as follows:
<TABLE>
<CAPTION>
Fund Average Return
--------------------------------------------------------------------
<S> <C>
For August 31, 1999.
Micro Cap %
Growth %
Mid Cap %
Larger Cap Value %
Small Cap Value* %
For August 31, 1998.
Micro Cap 9.29%
Growth (1.62)%
Mid Cap 12.68%
Larger Cap Value** N/A
For August 31, 1997.
Micro Cap 41.43%
</TABLE>
-41-
<PAGE>
<TABLE>
<CAPTION>
Fund Average Return
-------------------------------------------------------------------------
<S> <C>
Growth 27.86%
Mid Cap 33.71%
For the period June 3, 1996 (initial public offering) to August 31, 1996.
Micro Cap N/A
Growth N/A
Mid Cap N/A
</TABLE>
* The Small Cap Value Fund commenced operations on November 30, 1998.
** The Larger Cap Value Fund commenced operations on December 9, 1997.
Calculated according to the above formula, the aggregate total return for
the Funds was as follows:
<TABLE>
<CAPTION>
Fund Average Return
------------------------------------------------------------------------
<S> <C>
For August 31, 1999.
Micro Cap %
Growth %
Mid Cap %
Larger Cap Value %
Small Cap Value* %
For August 31, 1998.
Micro Cap 22.10%
Growth (3.59)%
Mid Cap 30.76%
Larger Cap Value** (9.67)%
For August 31, 1997.
Micro Cap 58.41%
Growth 37.69%
Mid Cap 49.11%
For the period June 3, 1996 (initial public offering) to August 31, 1996.
Micro Cap 54.05%
Growth 35.85%
Mid Cap 43.64%
</TABLE>
* The Small Cap Value Fund commenced operations on November 30, 1998.
** The Larger Cap Value Fund commenced operations on December 9, 1997.
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
-42-
<PAGE>
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.
TAXES
The Fund intends to qualify as a regulated investment company under
Subchapter M of the Internal Revenue Code, and to distribute out its income to
shareholders each year, so that the Fund itself generally will be relieved of
federal income and excise taxes. If the Fund were to fail to so qualify: (1) the
Fund would be taxed at regular corporate rates without any deduction for
distributions to shareholders; and (2) shareholders would be taxed as if they
received ordinary dividends, although corporate shareholders could be eligible
for the dividends received deduction.
MISCELLANEOUS
Counsel. The law firm of Drinker Biddle & Reath LLP, One Logan Square,
18th and Cherry Streets, Philadelphia, Pennsylvania 19103-6996, serves as
counsel to RBB and RBB's non-interested directors.
Independent Accountants. ______________________________________, serves as
RBB's independent accountants.
Banking Laws. Banking laws and regulations currently prohibit a bank
holding company registered under the Federal Bank Holding Company Act of 1956 or
any bank or non-bank affiliate thereof from sponsoring, organizing, controlling
or distributing the shares of a registered, open-end investment company
continuously engaged in the issuance of its shares, and prohibit banks generally
from underwriting securities, but such banking laws and regulations do not
prohibit such a holding company or affiliate or banks generally from acting as
investment adviser, administrator, transfer agent or custodian to such an
investment company, or from purchasing shares of such a company as agent for and
upon the order of customers. Blackrock Investment Management Company ("BIMC"),
PNC Bank and other institutions that are banks or bank affiliates are subject to
such banking laws and regulations.
BIMC and PNC Bank believe they may perform the services for RBB
contemplated by their respective agreements with RBB without violation of
applicable banking laws or regulations. It should be noted, however, that there
have been no cases deciding whether bank
-43-
<PAGE>
and non-bank subsidiaries of a registered bank holding company may perform
services comparable to those that are to be performed by these companies, and
future changes in either federal or state statutes and regulations relating to
permissible activities of banks and their subsidiaries or affiliates, as well as
further judicial or administrative decisions or interpretations of present and
future statutes and regulations, could prevent these companies from continuing
to perform such services for RBB. If such were to occur, it is expected that the
Board of Directors would recommend that RBB enter into new agreements or would
consider the possible termination of RBB. Any new advisory or sub-advisory
agreement would normally be subject to shareholder approval. It is not
anticipated that any change in RBB's method of operations as a result of these
occurrences would affect its net asset value per share or result in a financial
loss to any shareholder.
FINANCIAL STATEMENTS
The audited financial statements and notes thereto in the Funds'
__________________ (the "1999 ______________") for the fiscal year ended August
31, 1999 (the "Financial Statements") are incorporated by reference into this
Statement of Additional Information. No other parts of the 1999 __________ are
incorporated by reference herein. The financial statements included in the 1999
_________ have been audited by RBB's independent accountants, _________. The
reports of ____________________________ are incorporated herein by reference,
and such financial statements have been incorporated herein in reliance upon
such reports given upon their authority as experts in accounting and auditing.
Copies of the 1999 _______________ may be obtained free of charge by telephoning
PFPC at (800) 348-5031.
-44-
<PAGE>
APPENDIX A
----------
Commercial Paper Ratings
- ------------------------
"Prime-1" - Issuers (or supporting institutions) have a superior ability
for repayment of senior short-term debt obligations. Prime-1 repayment ability
will often be evidenced by many of the following characteristics: leading market
positions in well-established industries; high rates of return on funds
employed; conservative capitalization structure with moderate reliance on debt
and ample asset protection; broad margins in earnings coverage of fixed
financial charges and high internal cash generation; and well-established access
to a range of financial markets and assured sources of alternate liquidity.
"Prime-2" - Issuers (or supporting institutions) have a strong ability for
repayment of senior short-term debt obligations. This will normally be
evidenced by many of the characteristics cited above but to a lesser degree.
Earnings trends and coverage ratios, while sound, may be more subject to
variation. Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternate liquidity is maintained.
"Prime-3" - Issuers (or supporting institutions) have an acceptable ability
for repayment of senior short-term debt obligations. The effect of industry
characteristics and market compositions 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.
"Not Prime" - Issuers do not fall within any of the Prime rating
categories.
The three rating categories of Duff & Phelps for investment grade
commercial paper and short-term debt are "D-1," "D-2" and "D-3." Duff & Phelps
employs three designations, "D-1+," "D-1" and "D-1-," within the highest rating
category. The following summarizes the rating categories used by Duff & Phelps
for commercial paper:
"D-1+" - Debt possesses the highest certainty of timely payment. Short-term
liquidity, including internal operating factors and/or access to alternative
sources of funds, is outstanding, and safety is just below risk-free U.S.
Treasury short-term obligations.
"D-1" - Debt possesses very high certainty of timely payment. Liquidity
factors are excellent and supported by good fundamental protection factors.
Risk factors are minor.
"D-1-" - Debt possesses high certainty of timely payment. Liquidity factors
are strong and supported by good fundamental protection factors. Risk factors
are very small.
"D-2" - Debt possesses good certainty of timely payment. Liquidity factors
and company fundamentals are sound. Although ongoing funding needs may enlarge
total financing requirements, access to capital markets is good. Risk factors
are small.
A-1
<PAGE>
"D-3" - Debt possesses satisfactory liquidity and other protection factors
qualify issues as to investment grade. Risk factors are larger and subject to
more variation. Nevertheless, timely payment is expected.
"D-4" - Debt possesses speculative investment characteristics. Liquidity is
not sufficient to insure against disruption in debt service. Operating factors
and market access may be subject to a high degree of variation.
"D-5" - Issuer failed to meet scheduled principal and/or interest payments.
Fitch IBCA short-term ratings apply to debt obligations that have time
horizons of less than 12 months for most obligations, or up to three years for
U.S. public finance securities. The following summarizes the rating categories
used by Fitch IBCA for short-term obligations:
"F1" - Securities possess the highest credit quality. This designation
indicates the strongest capacity for timely payment of financial commitments and
may have an added "+" to denote any exceptionally strong credit feature.
"F2" - Securities possess good credit quality. This designation indicates a
satisfactory capacity for timely payment of financial commitments, but the
margin of safety is not as great as in the case of the higher ratings.
"F3" - Securities possess fair credit quality. This designation indicates
that the capacity for timely payment of financial commitments is adequate;
however, near-term adverse changes could result in a reduction to non-investment
grade.
"B" - Securities possess speculative credit quality. This designation
indicates minimal capacity for timely payment of financial commitments, plus
vulnerability to near-term adverse changes in financial and economic conditions.
"C" - Securities possess high default risk. This designation indicates that
default is a real possibility and that the capacity for meeting financial
commitments is solely reliant upon a sustained, favorable business and economic
environment.
"D" - Securities are in actual or imminent payment default.
Thomson Financial BankWatch short-term ratings assess the likelihood of an
untimely payment of principal and interest of debt instruments with original
maturities of one year or less. The following summarizes the ratings used by
Thomson Financial BankWatch:
"TBW-1" - This designation represents Thomson Financial BankWatch's highest
category and indicates a very high likelihood that principal and interest will
be paid on a timely basis.
A-2
<PAGE>
"TBW-2" - This designation represents Thomson Financial BankWatch's second-
highest category and indicates that while the degree of safety regarding timely
repayment of principal and interest is strong, the relative degree of safety is
not as high as for issues rated "TBW-1."
"TBW-3" - This designation represents Thomson Financial BankWatch's lowest
investment-grade category and indicates that while the obligation is more
susceptible to adverse developments (both internal and external) than those with
higher ratings, the capacity to service principal and interest in a timely
fashion is considered adequate.
"TBW-4" - This designation represents Thomson Financial BankWatch's lowest
rating category and indicates that the obligation is regarded as non-investment
grade and therefore speculative.
Corporate and Municipal Long-Term Debt Ratings
- ----------------------------------------------
The following summarizes the ratings used by Standard & Poor's for
corporate and municipal debt:
"AAA" - An obligation rated "AAA" has the highest rating assigned by
Standard & Poor's. The obligor's capacity to meet its financial commitment on
the obligation is extremely strong.
"AA" - An obligation rated "AA" differs from the highest rated obligations
only in small degree. The obligor's capacity to meet its financial commitment
on the obligation is very strong.
"A" - An obligation rated "A" is somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than obligations in
higher-rated categories. However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.
"BBB" - An obligation rated "BBB" exhibits adequate protection parameters.
However, adverse economic conditions or changing circumstances are more likely
to lead to a weakened capacity of the obligor to meet its financial commitment
on the obligation.
Obligations rated "BB," "B," "CCC," "CC" and "C" are regarded as having
significant speculative characteristics. "BB" indicates the least degree of
speculation and "C" the highest. While such obligations will likely have some
quality and protective characteristics, these may be outweighed by large
uncertainties or major exposures to adverse conditions.
"BB" - An obligation rated "BB" is less vulnerable to nonpayment than other
speculative issues. However, it faces major ongoing uncertainties or exposure
to adverse business, financial or economic conditions which could lead to the
obligor's inadequate capacity to meet its financial commitment on the
obligation.
"B" - An obligation rated "B" is more vulnerable to nonpayment than
obligations rated "BB", but the obligor currently has the capacity to meet its
financial commitment on the
A-3
<PAGE>
obligation. Adverse business, financial or economic conditions will likely
impair the obligor's capacity or willingness to meet its financial commitment on
the obligation.
"CCC" - An obligation rated "CCC" is currently vulnerable to nonpayment,
and is dependent upon favorable business, financial and economic conditions for
the obligor to meet its financial commitment on the obligation. In the event of
adverse business, financial, or economic conditions, the obligor is not likely
to have the capacity to meet its financial commitment on the obligation.
"CC" - An obligation rated "CC" is currently highly vulnerable to
nonpayment.
"C" - The "C" rating may be used to cover a situation where a bankruptcy
petition has been filed or similar action taken, but payments on this obligation
are being continued.
"D" - An obligation rated "D" is in payment default. The "D" rating
category is used when payments on an obligation are not made on the date due
even if the applicable grace period has not expired, unless Standard & Poor's
believes that such payments will be made during such grace period. The "D"
rating also will be used upon the filing of a bankruptcy petition or the taking
of a similar action if payments on an obligation are jeopardized.
PLUS (+) OR MINUS (-) - The ratings from "AA" through "CCC" may be modified
by the addition of a plus or minus sign to show relative standing within the
major rating categories.
"r" - This symbol is attached to the ratings of instruments with
significant noncredit risks. It highlights risks to principal or volatility of
expected returns which are not addressed in the credit rating. Examples include:
obligations linked or indexed to equities, currencies, or commodities;
obligations exposed to severe prepayment risk - such as interest-only or
principal-only mortgage securities; and obligations with unusually risky
interest terms, such as inverse floaters.
The following summarizes the ratings used by Moody's for corporate and
municipal long-term debt:
"Aaa" - Bonds are judged to be of the best quality. They carry the smallest
degree of investment risk and are generally referred to as "gilt edged."
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 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 risk appear somewhat larger than the "Aaa" securities.
"A" - Bonds possess many favorable investment attributes and are to be
considered as
A-4
<PAGE>
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 are considered as medium-grade obligations, (i.e., they are
neither highly protected nor poorly secured). Interest payments 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.
"Ba," "B," "Caa," "Ca," and "C" - Bonds that possess one of these ratings
provide questionable protection of interest and principal ("Ba" indicates
speculative elements; "B" indicates a general lack of characteristics of
desirable investment; "Caa" are of poor standing; "Ca" represents obligations
which are speculative in a high degree; and "C" represents the lowest rated
class of bonds). "Caa," "Ca" and "C" bonds may be in default.
Con. (---) - Bonds for which the security depends upon the completion of
some act or the fulfillment of some condition are rated conditionally. These are
bonds secured by (a) earnings of projects under construction, (b) earnings of
projects unseasoned in operating experience, (c) rentals which begin when
facilities are completed, or (d) payments to which some other limiting condition
attaches. Parenthetical rating denotes probable credit stature upon completion
of construction or elimination of basis of condition.
Note: Moody's applies numerical modifiers 1, 2, and 3 in each generic
rating classification from "Aa" through "Caa". The modifier 1 indicates that the
obligation ranks in the higher end of its generic rating category; the modifier
2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the
lower end of its generic rating category.
The following summarizes the long-term debt ratings used by Duff & Phelps
for corporate and municipal long-term debt:
"AAA" - Debt is considered to be of the highest credit quality. The risk
factors are negligible, being only slightly more than for risk-free U.S.
Treasury debt.
"AA" - Debt is considered to be of high credit quality. Protection factors
are strong. Risk is modest but may vary slightly from time to time because of
economic conditions.
"A" - Debt possesses protection factors which are average but adequate.
However, risk factors are more variable in periods of greater economic stress.
"BBB" - Debt possesses below-average protection factors but such protection
factors are still considered sufficient for prudent investment. Considerable
variability in risk is present during economic cycles.
"BB," "B," "CCC," "DD," and "DP" - Debt that possesses one of these ratings
is considered to be below investment grade. Although below investment grade,
debt rated "BB" is
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<PAGE>
deemed likely to meet obligations when due. Debt rated "B" possesses the risk
that obligations will not be met when due. Debt rated "CCC" is well below
investment grade and has considerable uncertainty as to timely payment of
principal, interest or preferred dividends. Debt rated "DD" is a defaulted debt
obligation, and the rating "DP" represents preferred stock with dividend
arrearages.
To provide more detailed indications of credit quality, the "AA," "A,"
"BBB," "BB" and "B" ratings may be modified by the addition of a plus (+) or
minus (-) sign to show relative standing within these major categories.
The following summarizes the ratings used by Fitch IBCA for corporate and
municipal bonds:
"AAA" - Bonds considered to be investment grade and of the highest credit
quality. These ratings denote the lowest expectation of credit risk and are
assigned only in case of exceptionally strong capacity for timely payment of
financial commitments. This capacity is highly unlikely to be adversely
affected by foreseeable events.
"AA" - Bonds considered to be investment grade and of very high credit
quality. These ratings denote a very low expectation of credit risk and
indicate very strong capacity for timely payment of financial commitments. This
capacity is not significantly vulnerable to foreseeable events.
"A" - Bonds considered to be investment grade and of high credit quality.
These ratings denote a low expectation of credit risk and indicate strong
capacity for timely payment of financial commitments. This capacity may,
nevertheless, be more vulnerable to changes in circumstances or in economic
conditions than is the case for higher ratings.
"BBB" - Bonds considered to be investment grade and of good credit quality.
These ratings denote that there is currently a low expectation of credit risk.
The capacity for timely payment of financial commitments is considered adequate,
but adverse changes in circumstances and in economic conditions are more likely
to impair this capacity.
"BB" - Bonds considered to be speculative. These ratings indicate that
there is a possibility of credit risk developing, particularly as the result of
adverse economic change over time; however, business or financial alternatives
may be available to allow financial commitments to be met. Securities rated in
this category are not investment grade.
"B" - Bonds are considered highly speculative. These ratings indicate that
significant credit risk is present, but a limited margin of safety remains.
Financial commitments are currently being met; however, capacity for continued
payment is contingent upon a sustained, favorable business and economic
environment.
"CCC", "CC", "C" - Bonds have high default risk. Default is a real
possibility, and capacity for meeting financial commitments is solely reliant
upon sustained, favorable business or economic developments. "CC" ratings
indicate that default of some kind appears probable,
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<PAGE>
and "C" ratings signal imminent default.
"DDD," "DD" and "D" - Bonds are in default. The ratings of obligations in
this category are based on their prospects for achieving partial or full
recovery in a reorganization or liquidation of the obligor. While expected
recovery values are highly speculative and cannot be estimated with any
precision, the following serve as general guidelines. "DDD" obligations have
the highest potential for recovery, around 90%-100% of outstanding amounts and
accrued interest. "DD" indicates potential recoveries in the range of 50%-90%,
and "D" the lowest recovery potential, i.e., below 50%.
Entities rated in this category have defaulted on some or all of their
obligations. Entities rated "DDD" have the highest prospect for resumption of
performance or continued operation with or without a formal reorganization
process. Entities rated "DD" and "D" are generally undergoing a formal
reorganization or liquidation process; those rated "DD" are likely to satisfy a
higher portion of their outstanding obligations, while entities rated "D" have a
poor prospect for repaying all obligations.
To provide more detailed indications of credit quality, the Fitch IBCA
ratings from and including "AA" to "CCC" may be modified by the addition of a
plus (+) or minus (-) sign to show relative standing within these major rating
categories.
Thomson Financial BankWatch assesses the likelihood of an untimely
repayment of principal or interest over the term to maturity of long term debt
and preferred stock which are issued by United States commercial banks, thrifts
and non-bank banks; non-United States banks; and broker-dealers. The following
summarizes the rating categories used by Thomson BankWatch for long-term debt
ratings:
"AAA" - This designation indicates that the ability to repay principal and
interest on a timely basis is extremely high.
"AA" - This designation indicates a very strong ability to repay principal
and interest on a timely basis, with limited incremental risk compared to issues
rated in the highest category.
"A" - This designation indicates that the ability to repay principal and
interest is strong. Issues rated "A" could be more vulnerable to adverse
developments (both internal and external) than obligations with higher ratings.
"BBB" - This designation represents the lowest investment-grade category
and indicates an acceptable capacity to repay principal and interest. Issues
rated "BBB" are more vulnerable to adverse developments (both internal and
external) than obligations with higher ratings.
"BB," "B," "CCC," and "CC," - These designations are assigned by Thomson
Financial BankWatch to non-investment grade long-term debt. Such issues are
regarded as having speculative characteristics regarding the likelihood of
timely payment of principal and interest. "BB" indicates the lowest degree of
speculation and "CC" the highest degree of speculation.
A-7
<PAGE>
"D" - This designation indicates that the long-term debt is in default.
PLUS (+) OR MINUS (-) - The ratings from "AAA" through "CC" may include a
plus or minus sign designation which indicates where within the respective
category the issue is placed.
Municipal Note Ratings
- ----------------------
A Standard and Poor's rating reflects the liquidity factors and market
access risks unique to notes due in three years or less. The following
summarizes the ratings used by Standard & Poor's for municipal notes:
"SP-1" - The issuers of these municipal notes exhibit a strong capacity to
pay principal and interest. Those issues determined to possess a very strong
capacity to pay debt service are given a plus (+) designation.
"SP-2" - The issuers of these municipal notes exhibit satisfactory capacity
to pay principal and interest, with some vulnerability to adverse financial and
economic changes over the term of the notes.
"SP-3" - The issuers of these municipal notes exhibit speculative capacity
to pay principal and interest.
Moody's ratings for state and municipal notes and other short-term loans
are designated Moody's Investment Grade ("MIG") and variable rate demand
obligations are designated Variable Moody's Investment Grade ("VMIG"). Such
ratings recognize the differences between short-term credit risk and long-term
risk. The following summarizes the ratings by Moody's Investors Service, Inc.
for short-term notes:
"MIG-1"/ "VMIG-1" - This designation denotes best quality. There is present
strong protection by established cash flows, superior liquidity support or
demonstrated broad-based access to the market for refinancing.
"MIG-2"/ "VMIG-2" - This designation denotes high quality, with margins of
protection that are ample although not so large as in the preceding group.
"MIG-3"/ "VMIG-3" - This designation denotes favorable quality, with all
security elements accounted for but lacking the undeniable strength of the
preceding grades. Liquidity and cash flow protection may be narrow and market
access for refinancing is likely to be less well established.
"MIG-4"/ "VMIG-4" - This designation denotes adequate quality. Protection
commonly regarded as required of an investment security is present and although
not distinctly or predominantly speculative, there is specific risk.
A-8
<PAGE>
"SG" - This designation denotes speculative quality. Debt instruments in
this category lack of margins of protection.
Fitch IBCA and Duff & Phelps use the short-term ratings described under
Commercial Paper Ratings for municipal notes.
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PART C
OTHER INFORMATION
Item 23. EXHIBITS
<TABLE>
<CAPTION>
SEE NOTE #
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<S> <C>
(a) (1) Articles of Incorporation of Registrant. 1
(2) Articles Supplementary of Registrant. 1
(3) Articles of Amendment to Articles of Incorporation of Registrant. 2
(4) Articles Supplementary of Registrant. 2
(5) Articles Supplementary of Registrant. 5
(6) Articles Supplementary of Registrant. 6
(7) Articles Supplementary of Registrant. 9
(8) Articles Supplementary of Registrant. 10
(9) Articles Supplementary of Registrant. 11
(10) Articles Supplementary of Registrant. 11
(11) Articles Supplementary of Registrant. 13
(12) Articles Supplementary of Registrant. 13
(13) Articles Supplementary of Registrant. 13
(14) Articles Supplementary of Registrant. 13
(15) Articles Supplementary of Registrant. 14
(16) Articles Supplementary of Registrant. 17
(17) Articles Supplementary of Registrant. 19
(18) Articles Supplementary of Registrant. 21
(19) Articles of Amendment to Charter of the Registrant. 22
(20) Articles Supplementary of Registrant. 22
(21) Articles Supplementary of Registrant. 31
(22) Articles Supplementary of Registrant. 31
(23) Articles Supplementary of Registrant. 29
(24) Articles Supplementary of Registrant 29
(25) Articles Supplementary of Registrant 34
(b) (1) By-Laws, as amended. 22
(c) (1) See Articles VI, VII, VIII, IX and XI of Registrant's Articles of 1
Incorporation dated February 17, 1988.
(2) See Articles II, III, VI, XIII, and XIV of Registrant's By-Laws as amended 17
through April 26, 1996.
(d) (1) Investment Advisory Agreement (Money Market) between Registrant and Provident 3
Institutional Management Corporation, dated as of August 16, 1988.
(2) Sub-Advisory Agreement (Money Market) between Provident Institutional Management 3
Corporation and Provident National Bank, dated as of August 16, 1988.
(3) Assumption Agreement (Money Market Fund) between PNC Bank, N.A. and BlackRock 34
Institutional Management Corporation (formerly PNC Institutional Management Corporation)
dated April 29, 1998.
(4) Investment Advisory Agreement (Tax-Free Money Market) between Registrant and Provident 3
Institutional Management Corporation, dated as of August 16, 1988.
(5) Sub-Advisory Agreement (Tax-Free Money Market) between Provident Institutional 3
Management Corporation and Provident National Bank, dated as of August 16, 1988.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SEE NOTE #
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<S> <C>
(6) Assumption Agreement (Municipal Money Market Fund) between PNC Bank, N.A. and BlackRock 34
Institutional Management Corporation (formerly PNC Institutional Management Corporation)
dated April 29, 1998.
(7) Investment Advisory Agreement (Government Obligations Money Market) between Registrant 3
and Provident Institutional Management Corporation, dated as of August 16, 1988.
(8) Sub-Advisory Agreement (Government Obligations Money Market) between Provident 3
Institutional Management Corporation and Provident National Bank, dated as of August 16,
1988.
(9) Assumption Agreement (Government Obligations Money Market Fund) between PNC 34
Bank, N.A. and BlackRock Institutional Management Corporation (formerly PNC
Institutional Management Corporation) dated April 29, 1998.
(10) Investment Advisory Agreement (Government Securities) between Registrant and 8
Provident Institutional Management Corporation dated as of April 8, 1991.
(11) Investment Advisory Agreement (New York Municipal Money Market) between 9
Registrant and Provident Institutional Management Corporation dated November 5,
1991.
(12) Investment Advisory Agreement (Tax-Free Money Market) between Registrant and 10
Provident Institutional Management Corporation dated April 21, 1992.
(13) Investment Advisory Agreement (n/i Micro Cap Fund) between Registrant and 17
Numeric Investors, L.P.
(14) Investment Advisory Agreement (n/i Growth Fund) between Registrant and 17
Numeric Investors, L.P.
(15) Investment Advisory Agreement (n/i Growth & Value Fund) between Registrant 17
and Numeric Investors, L.P.
(16) Investment Advisory Agreement (Boston Partners Large Cap Value Fund) between 20
Registrant and Boston Partners Asset Management, L.P.
(17) Investment Advisory Agreement (Boston Partners Mid Cap Value Fund) between 22
Registrant and Boston Partners Asset Management, L.P.
(18) Investment Advisory Agreement (n/i Larger Cap Value Fund) between Registrant 24
and Numeric Investors, L.P. dated December 1, 1997.
(19) Investment Advisory Agreement (Boston Partners Bond Fund) between Registrant 24
and Boston Partners Asset Management, L.P. dated December 1, 1997.
(20) Investment Advisory Agreement (Schneider Small Cap Value Fund) between 29
Registrant and Schneider Capital Management Company.
(21) Investment Advisory Agreement (Boston Partners Micro Cap Value Fund) between 29
Registrant and Boston Partners Asset Management, L.P.
(22) Investment Advisory Agreement (Boston Partners Market Neutral Fund) between 31
Registrant and Boston Partners Asset Management, L.P.
(23) Investment Advisory Agreement (n/i Small Cap Value Fund) between Registrant 31
and Numeric Investors, L.P.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
SEE NOTE #
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<S> <C>
(24) Form of Investment Advisory Agreement (Boston Partners Long- Short 32
Equity Fund) between Registrant and Boston Partners Asset Management, L.P.
(25) Investment Advisory Agreement (Bogle Small Cap Growth Fund) between Registrant and 34
Bogle Investment Management, L. P.
(e) (1) Distribution Agreement between Registrant and Provident Distributors, Inc. 34
dated as of June 25, 1999.
(2) Distribution Agreement Supplement between Registrant and Provident Distributors, Inc. 34
(Bogle Small Cap Growth Fund- Institutional Class and Investor Class)
(f) Fund Office Retirement Profit-Sharing and Trust Agreement, dated as of October 24, 23
1990, as amended.
(g) (1) Custodian Agreement between Registrant and Provident National Bank dated as of 3
August 16, 1988.
(2) Sub-Custodian Agreement among The Chase Manhattan Bank, N.A., the Registrant 10
and Provident National Bank, dated as of July 13, 1992, relating to custody of
Registrant's foreign securities.
(3) Amendment No. 1 to Custodian Agreement dated August 16, 1988. 9
(4) Custodian Contract between Registrant and State Street Bank and Trust Company. 12
(5) Custody Agreement between Registrant and Custodial Trust Company on behalf of 17
n/i Micro Cap Fund, n/i Growth Fund and n/i Growth & Value Fund Portfolios of the
Registrant.
(6) Custodian Agreement Supplement Between Registrant and PNC Bank, National 20
Association dated October 16, 1996.
(7) Custodian Agreement Supplement between Registrant and PNC Bank, National 22
Association, on behalf of the Boston Partners Mid Cap Value Fund.
(8) Custody Agreement between Registrant and Custodial Trust Company on behalf of 24
the n/i Larger Cap Value Fund.
(9) Custodian Agreement Supplement between Registrant and PNC Bank, N.A. on behalf 24
of the Boston Partners Bond Fund.
(10) Custodian Agreement Supplement between Registrant and PNC Bank, N.A. on 29
behalf of the Schneider Small Cap Value Fund.
(11) Custodian Agreement Supplement between Registrant and PNC Bank, N.A. on 29
behalf of the Boston Partners Micro Cap Value Fund.
(12) Custodian Agreement Supplement between Registrant and PNC Bank, N.A. on 31
behalf of Boston Partners Market Neutral Fund.
(13) Custodian Agreement Supplement between Registrant and Custodial Trust Company 31
on behalf of n/i Small Cap Value Fund.
(14) Form of Custodian Agreement Supplement between Registrant and PFPC Trust Company 32
(Boston Partners Long Short Equity Fund)
(15) Custodian Agreement Supplement between Registrant and PFPC Trust Company (Bogle Small 34
Cap Growth Fund)
(h) (1) Transfer Agency Agreement (Sansom Street) between Registrant and Provident 3
Financial Processing Corporation, dated as of August 16, 1988.
(2) Transfer Agency Agreement (Cash Preservation) between Registrant and Provident 3
Financial Processing Corporation, dated as of August 16, 1988.
(3) Shareholder Servicing Agreement (Sansom Street Money Market). 3
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
SEE NOTE #
----------
<S> <C>
(4) Shareholder Servicing Agreement (Sansom Street Tax-Free Money Market). 3
(5) Shareholder Servicing Agreement (Sansom Street Government Obligations Money 3
Market).
(6) Shareholder Services Plan (Sansom Street Money Market). 3
(7) Shareholder Services Plan (Sansom Street Tax-Free Money Market). 3
(8) Shareholder Services Plan (Sansom Street Government Obligations Money Market). 3
(9) Transfer Agency Agreement (Bedford) between Registrant and Provident Financial 3
Processing Corporation, dated as of August 16, 1988.
(10) Administration and Accounting Services Agreement between Registrant and 8
Provident Financial Processing Corporation, relating to Government Securities
Portfolio, dated as of April 10, 1991.
(11) Administration and Accounting Services Agreement between Registrant and 9
Provident Financial Processing Corporation, relating to New York Municipal Money
Market Portfolio dated as of November 5, 1991.
(12) Transfer Agency Agreement and Supplements (Bradford, Alpha (now known as 9
Janney), Beta, Gamma, Delta, Epsilon, Zeta, Eta and Theta) between Registrant and
Provident Financial Processing Corporation dated as of November 5, 1991.
(13) Administration and Accounting Services Agreement between Registrant and 10
Provident Financial Processing Corporation, relating to Tax-Free Money Market
Portfolio, dated as of April 21, 1992.
(14) Transfer Agency and Service Agreement between Registrant and State Street 15
Bank and Trust Company and PFPC, Inc. dated February 1, 1995.
(15) Supplement to Transfer Agency and Service Agreement between Registrant, State 15
Street Bank and Trust Company, Inc. and PFPC dated April 10, 1995.
(16) Amended and Restated Credit Agreement dated December 15, 1994. 16
(17) Transfer Agency Agreement Supplement (n/i Micro Cap Fund, n/i Growth Fund and 17
n/i Growth & Value Fund) between Registrant and PFPC, Inc. dated April 14, 1996.
(18) Administration and Accounting Services Agreement between Registrant and PFPC, 17
Inc. (n/i Micro Cap Fund) dated April 24, 1996.
(19) Administration and Accounting Services Agreement between Registrant and PFPC, 17
Inc. (n/i Growth Fund) dated April 24, 1996.
(20) Administration and Accounting Services Agreement between Registrant and PFPC, 17
Inc. (n/i Growth & Value Fund) dated April 24, 1996.
(21) Transfer Agreement and Service Agreement between Registrant and State Street 18
Bank and Trust Company.
(22) Administration and Accounting Services Agreement between the Registrant and 21
PFPC Inc. dated October 16, 1996 (Boston Partners Large Cap Value Fund).
(23) Transfer Agency Agreement Supplement between Registrant and PFPC Inc. (Boston 20
Partners Large Cap Value Fund, Institutional Class).
(24) Transfer Agency Agreement Supplement between Registrant and PFPC Inc. (Boston 20
Partners Large Cap Value Fund, Investor Class).
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
SEE NOTE #
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<S> <C>
(25) Transfer Agency Agreement Supplement between Registrant and PFPC Inc. (Boston 20
Partners Large Cap Value Fund, Advisor Class).
(26) Transfer Agency Agreement Supplement between Registrant and PFPC Inc., 22
(Boston Partners Mid Cap Value Fund, Institutional Class).
(27) Transfer Agency Agreement Supplement between Registrant and PFPC Inc., 22
(Boston Partners Mid Cap Value Fund, Investor Class).
(28) Administration and Accounting Services Agreement between Registrant and PFPC 22
Inc. dated, May 30, 1997 (Boston Partners Mid Cap Value Fund).
(29) Transfer Agency Agreement Supplement (n/i Larger Cap Value Fund) between 24
Registrant and PFPC, Inc. dated December 1, 1997.
(30) Administration and Accounting Services Agreement between Registrant and PFPC, 24
Inc. dated December 1, 1997 (n/i Larger Cap Value Fund).
(31) Co-Administration Agreement between Registrant and Bear Stearns Funds 24
Management, Inc. dated December 1, 1997 (n/i Larger Cap Value Fund).
(32) Transfer Agency Agreement Supplement between Registrant and PFPC, Inc. dated 24
December 1, 1997 (Boston Partners Bond Fund, Institutional Class).
(33) Transfer Agency Agreement Supplement between Registrant and PFPC, Inc. dated 24
December 1, 1997 (Boston Partners Bond Fund, Investor Class).
(34) Administration and Accounting Services Agreement between Registrant and PFPC, 24
Inc. dated December 1, 1997 (Boston Partners Bond Fund).
(35) Administration and Accounting Services Agreement between Registrant and PFPC 29
Inc. (Schneider Small Cap Value Fund).
(36) Transfer Agency Agreement Supplement between Registrant and PFPC Inc. 29
(Schneider Small Cap Value Fund).
(37) Transfer Agency Agreement Supplement between Registrant and PFPC, Inc. 29
(Boston Partners Micro Cap Value Fund, Institutional Class).
(38) Transfer Agency Agreement Supplement between Registrant and PFPC, Inc. 29
(Boston Partners Micro Cap Value Fund, Investor Class).
(39) Administration and Accounting Services Agreement between Registrant and PFPC, 29
Inc. (Boston Partners Micro Cap Value Fund).
(40) Administrative Services Agreement between Registrant and Provident 26
Distributors, Inc. dated as of May 29, 1998 and relating to the n/i funds,
Schneider Small Cap Value Fund and Institutional Shares of the Boston Partners
Funds.
(41) Administrative Services Agreement Supplement between Registrant and Provident 31
Distributors, Inc. relating to the Boston Partners Market Neutral Fund
(Institutional Class).
(42) Administrative and Accounting Services Agreement between Registrant and PFPC, 31
Inc. (Boston Partners Market Neutral Fund - Institutional and Investor Classes).
(43) Transfer Agency Agreement Supplement between Registrant and PFPC, Inc. 31
(Boston Partners Market Neutral Fund - Institutional and Investor Classes).
(44) Transfer Agency Agreement Supplement between Registrant and PFPC, Inc. (n/i 31
Small Cap Value Fund).
</TABLE>
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<TABLE>
<CAPTION>
SEE NOTE #
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<S> <C>
(45) Administration and Accounting Services Agreement between Registrant and PFPC, 31
Inc. (n/i Small Cap Value Fund).
(46) Co-Administration Agreement between Registrant and Bear Stearns Funds 31
Management, Inc. (n/i Small Cap Value Fund).
(47) Administrative Services Agreement between Registrant and Provident 31
Distributors, Inc. (n/i Small Cap Value Fund).
(48) Form of Transfer Agency Agreement Supplement between Registrant and PFPC, Inc. (Boston 32
Partners Long-Short Equity Fund).
(49) Form of Administrative Services Agreement Supplement between Registrant and Provident 32
Distributors, Inc. (Boston Partners Long- Short Equity Fund- Institutional Shares).
(50) Form of Administration and Accounting Services Agreement between Registrant and PFPC, 32
Inc. (Boston Partners Long-Short Equity Fund).
(51) Transfer Agency Agreement Supplement between Registrant and PFPC, Inc. (Bogle Small Cap 34
Growth Fund)
(52) Administrative Services Agreement between Registrant and Provident Distributors, Inc. 34
(Bogle Small Cap Growth Fund)
(53) Non 12b-1 Shareholder Services Plan and Agreement for Bogle Small Cap Growth Investor 34
Shares
(54) Form of agreement between E*TRADE Group, Inc., 34
Registrant and Registrant's principal underwriter.
(i) Opinion of Drinker Biddle & Reath LLP 34
(j) (1) Consent of Drinker Biddle & Reath LLP. 34
(2) Consent of Independent Auditors. *
(k) None.
(l) (1) Subscription Agreement (relating to Classes A through N). 2
(2) Subscription Agreement between Registrant and Planco Financial Services, Inc., 7
relating to Classes O and P.
(3) Subscription Agreement between Registrant and Planco Financial Services, Inc., 7
relating to Class Q.
(4) Subscription Agreement between Registrant and Counsellors Securities Inc. 9
relating to Classes R, S, and Alpha 1 through Theta 4.
(5) Purchase Agreement between Registrant and Numeric Investors, L.P. relating to 17
Class FF (n/i Micro Cap Fund).
(6) Purchase Agreement between Registrant and Numeric Investors, L.P. relating to 17
Class GG (n/i Growth Fund).
(7) Purchase Agreement between Registrant and Numeric Investors, L.P. relating to 17
Class HH (n/i Growth & Value Fund).
(8) Purchase Agreement between Registrant and Boston Partners Asset Management, 21
L.P. relating to Classes QQ, RR and SS (Boston Partners Large Cap Value Fund).
(9) Purchase Agreement between Registrant and Boston Partners Asset Management, 22
L.P. relating to Classes TT and UU (Boston Partners Mid Cap Value Fund).
(10) Purchase Agreement between Registrant and Boston Partners Asset Management 24
L.P. relating to Classes VV and WW (Boston Partners Bond Fund).
(11) Purchase Agreement between Registrant and Numeric Investors, L.P. relating to 24
Class XX (n/i Larger Cap Value Fund).
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
SEE NOTE #
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<S> <C>
(12) Purchase Agreement between Registrant and Schneider Capital Management 29
Company relating to Class YY (Schneider Small Cap Value Fund).
(13) Purchase Agreement between Registrant and Boston Partners Asset Management, 29
L.P. relating to Classes DDD and EEE (Boston Partners Micro Cap Value Fund).
(14) Purchase Agreement between Registrant and Boston Partners Asset Management 31
relating to Classes III and JJJ (Boston Partners Market Neutral Fund).
(15) Purchase Agreement between Registrant and Provident Distributors, Inc. 31
relating to Class MMM (n/i Small Cap Value Fund).
(16) Form of Purchase Agreement between Registrant and Boston Partners Asset Management, L. 32
P. relating to Classes KKK and LLL (Boston Partners Long-Short Equity Fund).
(17) Purchase Agreement between Registrant and Bogle Investment Management, L. P. (Bogle 34
Small Cap Growth Fund)
(m) (1) Plan of Distribution (Sansom Street Money Market). 3
(2) Plan of Distribution (Sansom Street Tax-Free Money Market). 3
(3) Plan of Distribution (Sansom Street Government Obligations Money Market). 3
(4) Plan of Distribution (Cash Preservation Money). 3
(5) Plan of Distribution (Cash Preservation Tax-Free Money Market). 3
(6) Plan of Distribution (Bedford Money Market). 3
(7) Plan of Distribution (Bedford Tax-Free Money Market). 3
(8) Plan of Distribution (Bedford Government Obligations Money Market). 3
(9) Plan of Distribution (Income Opportunities High Yield). 7
(10) Amendment No. 1 to Plans of Distribution (Classes A through Q). 8
(11) Plan of Distribution (Alpha (now known as Janney) Money Market). 9
(12) Plan of Distribution (Alpha (now known as Janney) Tax-Free Money Market (now 9
known as the Municipal Money Market)).
(13) Plan of Distribution (Alpha (now known as Janney) Government Obligations 9
Money Market).
(14) Plan of Distribution (Alpha (now known as Janney) New York Municipal Money 9
Market).
(15) Plan of Distribution (Beta Tax-Free Money Market). 9
(16) Plan of Distribution (Beta Government Obligations Money Market). 9
(17) Plan of Distribution (Beta New York Money Market). 9
(18) Plan of Distribution (Gamma Tax-Free Money Market). 9
(19) Plan of Distribution (Gamma Government Obligations Money Market). 9
(20) Plan of Distribution (Gamma New York Municipal Money Market). 9
(21) Plan of Distribution (Delta Money Market). 9
(22) Plan of Distribution (Delta Tax-Free Money Market). 9
(23) Plan of Distribution (Delta Government Obligations Money Market). 9
(24) Plan of Distribution (Delta New York Municipal Money Market). 9
(25) Plan of Distribution (Epsilon Money Market). 9
(26) Plan of Distribution (Epsilon Tax-Free Money Market). 9
(27) Plan of Distribution (Epsilon Government Obligations Money Market). 9
(28) Plan of Distribution (Epsilon New York Municipal Money Market). 9
(29) Plan of Distribution (Zeta Money Market). 9
</TABLE>
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<TABLE>
<CAPTION>
SEE NOTE #
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<S> <C>
(30) Plan of Distribution (Zeta Tax-Free Money Market). 9
(31) Plan of Distribution (Zeta Government Obligations Money Market). 9
(32) Plan of Distribution (Zeta New York Municipal Money Market). 9
(33) Plan of Distribution (Eta Money Market). 9
(34) Plan of Distribution (Eta Tax-Free Money Market). 9
(35) Plan of Distribution (Eta Government Obligations Money Market). 9
(36) Plan of Distribution (Eta New York Municipal Money Market). 9
(37) Plan of Distribution (Theta Money Market). 9
(38) Plan of Distribution (Theta Tax-Free Money Market). 9
(39) Plan of Distribution (Theta Government Obligations Money Market). 9
(40) Plan of Distribution (Theta New York Municipal Money Market). 9
(41) Plan of Distribution (Boston Partners Large Cap Value Fund Investor Class). 21
(42) Plan of Distribution (Boston Partners Large Cap Value Fund Advisor Class). 21
(43) Plan of Distribution (Boston Partners Mid Cap Value Fund Investor Class). 21
(44) Plan of Distribution (Boston Partners Bond Fund Investor Class). 24
(45) Plan of Distribution (Boston Partners Micro Cap Value Fund Investor Class). 25
(46) Amendment to Plans of Distribution pursuant to Rule 12b-1. 31
(47) Plan of Distribution (Boston Partners Market Neutral Fund - Investor Class). 30
(48) Plan of Distribution (Principal Money Market). 29
(49) Form of Plan of Distribution (Boston Partners Long-Short Equity Fund- Investor Class). 32
(n) Not applicable.
(o) Amended 18f-3 Plan. 33
</TABLE>
NOTE #
------
1 Incorporated herein by reference to Registrant's Registration Statement
(No. 33-20827) filed on March 24, 1988, and refiled electronically with
Post-Effective Amendment No. 61 to Registrant's Registration Statement
filed on October 30, 1998.
2 Incorporated herein by reference to Pre-Effective Amendment No. 2 to
Registrant's Registration Statement (No. 33-20827) filed on July 12, 1988,
and refiled electronically with Post-Effective Amendment No. 61 to
Registrant's Registration Statement filed on October 30, 1998.
3 Incorporated herein by reference to Post-Effective Amendment No. 1 to
Registrant's Registration Statement (No. 33-20827) filed on March 23, 1989,
and refiled electronically with Post-Effective Amendment No. 61 to
Registrant's Registration Statement filed on October 30, 1998.
4 Incorporated herein by reference to Post-Effective Amendment No. 2 to
Registrant's Registration Statement (No. 33-20827) filed on October 25,
1989.
5 Incorporated herein by reference to Post-Effective Amendment No. 3 to the
Registrant's Registration Statement (No. 33-20827) filed on April 27, 1990,
and refiled electronically with Post-Effective Amendment No. 61 to
Registrant's Registration Statement filed on October 30, 1998.
-8-
<PAGE>
6 Incorporated herein by reference to Post-Effective Amendment No. 4 to the
Registrant's Registration Statement (No. 33-20827) filed on May 1, 1990,
and refiled electronically with Post-Effective Amendment No. 61 to
Registrant's Registration Statement filed on October 30, 1998.
7 Incorporated herein by reference to Post-Effective Amendment No. 5 to the
Registrant's Registration Statement (No. 33-20827) filed on December 14,
1990.
8 Incorporated herein by reference to Post-Effective Amendment No. 6 to the
Registrant's Registration Statement (No. 33-20827) filed on October 24,
1991, and refiled electronically with Post-Effective Amendment No. 61 to
Registrant's Registration Statement filed on October 30, 1998.
9 Incorporated herein by reference to Post-Effective Amendment No. 7 to the
Registrant's Registration Statement (No. 33-20827) filed on July 15, 1992,
and refiled electronically with Post-Effective Amendment No. 61 to
Registrant's Registration Statement filed on October 30, 1998.
10 Incorporated herein by reference to Post-Effective Amendment No. 8 to the
Registrant's Registration Statement (No. 33-20827) filed on October 22,
1992, and refiled electronically with Post-Effective Amendment No. 61 to
Registrant's Registration Statement filed on October 30, 1998.
11 Incorporated herein by reference to Post-Effective Amendment No. 13 to the
Registrant's Registration Statement (No. 33-20827) filed on October 29,
1993, and refiled electronically with Post-Effective Amendment No. 61 to
Registrant's Registration Statement filed on October 30, 1998.
12 Incorporated herein by reference to Post-Effective Amendment No. 21 to the
Registrant's Registration Statement (No. 33-20827) filed on October 28,
1994, and refiled electronically with Post-Effective Amendment No. 61 to
Registrant's Registration Statement filed on October 30, 1998.
13 Incorporated herein by reference to Post-Effective Amendment No. 22 to the
Registrant's Registration Statement (No. 33-20827) filed on December 19,
1994, and refiled electronically with Post-Effective Amendment No. 61 to
Registrant's Registration Statement filed on October 30, 1998.
14 Incorporated herein by reference to Post-Effective Amendment No. 27 to the
Registrant's Registration Statement (No. 33-20827) filed on March 31, 1995.
15 Incorporated herein by reference to Post-Effective Amendment No. 28 to the
Registrant's Registration Statement (No. 33-20827) filed on October 6,
1995.
16 Incorporated herein by reference to Post-Effective Amendment No. 29 to the
Registrant's Registration Statement (No. 33-20827) filed on October 25,
1995.
17 Incorporated herein by reference to Post-Effective Amendment No. 34 to the
Registrant's Registration Statement (No. 33-20827) filed on May 16, 1996.
18 Incorporated herein by reference to Post-Effective Amendment No. 37 to the
Registrant's Registration Statement (No. 33-20827) filed on July 30, 1996.
19 Incorporated herein by reference to Post-Effective Amendment No. 39 to the
Registrant's Registration Statement (No. 33-20827) filed on October 11,
1996.
20 Incorporated herein by reference to Post-Effective Amendment No. 41 to the
Registrant's Registration Statement (No. 33-20827) filed on November 27,
1996.
-9-
<PAGE>
21 Incorporated herein by reference to Post-Effective Amendment No. 45 to the
Registrant's Registration Statement (No. 33-20827) filed on May 9, 1997.
22 Incorporated herein by reference to Post-Effective Amendment No. 46 to the
Registrant's Registration Statement (33-20827) filed on September 25, 1997.
23 Incorporated herein by reference to Post-Effective Amendment No. 49 to the
Registrant's Registration Statement (33-20827) filed on December 1, 1997.
24 Incorporated herein by reference to Post-Effective Amendment No. 51 to the
Registrant's Registration Statement (33-20827) filed on December 8, 1997.
25 Incorporated herein by reference to Post-Effective Amendment No. 53 to the
Registrant's Registration Statement (33-20827) filed on April 10, 1998.
26 Incorporated herein by reference to Post-Effective Amendment No. 56 to the
Registrant's Registration Statement (33-20827) filed on June 25, 1998.
27 Incorporated herein by reference to Post-Effective Amendment No. 58 to the
Registrant's Registration Statement (33-20827) filed on August 25, 1998.
28 Incorporated herein by reference to Post-Effective Amendment No. 59 to the
Registrant's Registration Statement (33-20827) filed on September 15, 1998.
29 Incorporated herein by reference to Post-Effective Amendment No. 60 to the
Registrant's Registration Statement (33-20827) filed on October 29, 1998.
30 Incorporated herein by reference to Post-Effective Amendment No. 62 to the
Registrant's Registration Statement (33-20827) filed on November 12, 1998.
31 Incorporated herein by reference to Post-Effective Amendment No. 63 to the
Registrant's Registration Statement (33-20827) filed on December 14, 1998.
32 Incorporated herein by reference to Post-Effective Amendment No. 65 to the
Registrant's Registration Statement (33-20827) filed on May 19, 1999.
33 Incorporated herein by reference to Post-Effective Amendment No. 66 to the
Registrant's Registration Statement (33-20827) filed on July 2, 1999.
34 A copy of such exhibit is filed electronically herewith.
* To be filed by Amendment.
-10-
<PAGE>
Item 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
None.
Item 25. INDEMNIFICATION
Sections 1, 2, 3 and 4 of Article VIII of Registrant's Articles
of Incorporation, as amended, incorporated herein by reference as
Exhibits (a)(1) and (a)(3), 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 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.
-11-
<PAGE>
Item 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
Information as to any other business, profession, vocation or
employment of substantial nature in which any directors and officers of BIMC,
Numeric, Boston Partners, and Schneider Capital Management Company 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 BIMC's FORM ADV (File
No. 801-13304) filed on March 29, 1999 (amended August 31, 1999), Schedules B
and D of Numeric's FORM ADV (File No. 801-35649) filed on March 11, 1999,
Schedules B and D of Boston Partners' FORM ADV (File No. 801-49059) filed on
March 30, 1999, Schedules B and D of Schneider Capital Management Company's FORM
ADV (File No. 801-55439) filed on March 30, 1999.
Set forth below are the names and principal businesses of the
directors and certain of the senior executive officers of Bogle Investment
Management, L. P. who are or have been engaged in any other business,
profession, vocation or employment of a substantial nature
<TABLE>
<CAPTION>
Name Position with Bogle Other Business Type of Business
---- Investment Management, Connections ----------------
L. P. -----------
-----
<S> <C> <C> <C>
John Bogle, Jr. President Managing Director, Investment Management
Numeric Investors, L. P.
</TABLE>
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
<TABLE>
<CAPTION>
Position with Name Other Business Connections Type of Business
PNC Bank ---- -------------------------- ----------------
- ---------
<S> <C> <C> <C>
Director Paul W. Chellgren Chairman and Chief Executive Officer Energy Company
Ashland Inc.
P.O. 391
Covington, KY 41012-0391
Director Robert N. Clay President and Chief Executive Officer Investments
Clay Holding Company
Three Chimneys Farm
P. O. Box 114
Midway. KY 40347
Director George A. Davidson, Jr. Chairman and Chief Executive Officer Public Utility Holding Company
Consolidated Natural Gas Company
CNG Tower, 625 Liberty Avenue
Pittsburgh, PA 15222-3199
Director David F. Girard-diCarlo Managing Partner Law Firm
Blank Rome Comisky & McCauley LLP
One Logan Square
Philadelphia, PA 19103-6998
</TABLE>
-12-
<PAGE>
<TABLE>
<CAPTION>
Position with Name Other Business Connections Type of Business
PNC Bank ---- -------------------------- ----------------
- --------
<S> <C> <C> <C>
Director Walter E. Gregg, Jr. Vice Chairman Diversified Financial Services
PNC Bank Corp.
One PNC Plaza
249 Fifth Street
Pittsburgh, PA 15222-2707
Director William R. Johnson President and Chief Executive Officer Food Products Company
H.J. Heinz Company
600 Grant Street
Pittsburgh, PA 15219-2857
Director Bruce C. Lindsay Chairman and Managing Director Advisory Company
Brind-Lindsay & Co., Inc.
1926 Arch Street
Philadelphia, PA 19103-1444
Director W. Craig McClelland Retired Chairman and Chief Executive Paper Manufacturing and Land
Officer Resources
Union Camp Corporation
50 Tice Boulevard
Woodcliff Lake, NJ 07675
Director Thomas H. O'Brien Chairman and Chief Executive Officer Diversified Financial Services
PNC Bank Corp.
One PNC Plaza
249 Fifth Avenue
Pittsburgh, PA 15222-2707
Director Jane G. Pepper President Nonprofit Horticultural
Pennsylvania Horticultural Society Membership Organization
100 N. 20th Street -5th Floor
Philadelphia, PA 19103-1495
Director Jackson H. Randolph Chairman Public Utility Holding Company
Cinergy Corp.
221 East Fourth Street, Suite 3004
Cincinnati, OH 45202
Director James E. Rohr President & Chief Operating Officer Diversified Financial Services
PNC Bank Corp.
One PNC Plaza
249 Fifth Street
Pittsburgh PA 15222-2707
Director Roderic H. Ross Vice Chairman and Chief Executive Officer Insurance Company
Keystone State Life Insurance Co.
Suite 325
501 Office Center Drive
Fort Washington, PA 19034-3299
</TABLE>
-13-
<PAGE>
<TABLE>
<CAPTION>
Position with Name Other Business Connections Type of Business
PNC Bank ---- -------------------------- ----------------
- --------
<S> <C> <C> <C>
Director Richard P. Simmons Chairman, President & CEO Specialty Metals and
Allegheny Teledyne Incorporated Diversified Business
1000 Six PPG Place
Pittsburgh, PA 15222-5479
Director Thomas J. Usher Chairman and Chief Executive Officer Energy, Steel and Diversified
USX Corporation Business
61st Floor
600 Grant Street
Pittsburgh, PA 15219-4776
Director Milton A. Washington President and Chief Executive Officer Housing Rehabilitation and
AHRCO Construction
5604 Baum Boulevard
Pittsburgh, PA 15206
Director Helge H. Wehmeier President and Chief Executive Officer Healthcare, Life Sciences and
Bayer Corporation Chemicals
100 Bayer Road, Building 4
Pittsburgh, PA 15205-9741
</TABLE>
PNC Bank Corp. / PNC Bank, National Association
Officers
<TABLE>
<CAPTION>
Name Position Address
<S> <C> <C>
Thomas H. O'Brien Chairman and Chief Executive Officer PNC Bank Corp. P1-POPP-30-1
One PNC Plaza
249 Fifth Avenue
Pittsburgh, PA 15222-2707
James E. Rohr President and Chief Operating Officer PNC Bank Corp. P1-POPP-30-1
One PNC Plaza
249 Fifth Avenue
Pittsburgh, PA 15222-2707
Walter E. Gregg, Jr. Vice Chairman PNC Bank Corp. P1-POPP-30-1
One PNC Plaza
249 Fifth Avenue
Pittsburgh, PA 15222-2707
Ralph S. Michael, III Executive Vice President, Corporate Banking One PNC Plaza P1-POPP-30-1
249 Fifth Avenue
Pittsburgh, PA 15222-2707
Bruce E. Robbins Executive Vice President, Secured Lending One PNC Plaza P1-POPP-30-1
249 Fifth Avenue
Pittsburgh, PA 15222-2707
</TABLE>
-14-
<PAGE>
<TABLE>
<CAPTION>
Name Position Address
<S> <C> <C>
Joseph C. Guyaux Executive Vice President, Regional Community One PNC Plaza P1-POPP-29-1
Bank 249 Fifth Avenue
Pittsburgh, PA 15222-2707
Thomas K. Whitford Executive Vice President, Private Bank One PNC Plaza P1-POPP-29-1
249 Fifth Avenue
Pittsburgh, PA 15222-2707
Robert L. Haunschild Senior Vive President and Chief Financial One PNC Plaza P1-POPP-30-1
Officer 249 Fifth Avenue
Pittsburgh, PA 15222-2707
Thomas E. Paisley, III Senior Vice President, Corporate Credit One PNC Plaza P1-POPP-30-1
Policy 249 Fifth Avenue
Pittsburgh, PA 15222-2707
Helen P. Pudlin Senior Vice President and General Counsel One PNC Plaza P1-POPP-21-1
249 Fifth Avenue
Pittsburgh, PA 15222-2707
Samuel R. Patterson Controller One PNC Plaza P1-POPP-30-1
249 Fifth Avenue
Pittsburgh, PA 15222-2707
</TABLE>
Item 27. PRINCIPAL UNDERWRITER
(a) Provident Distributors, Inc. (the "Distributor") acts as
principal underwriter for the following investment companies:
Time Horizon Funds
Pacific Innovations Trust
International Dollar Reserve Fund I, Ltd.
Provident Institutional Funds Trust
Columbia Common Stock Fund, Inc.
Columbia Growth Fund, Inc.
Columbia International Stock Fund, Inc.
Columbia Special Fund, Inc.
Columbia Small Cap Fund, Inc.
Columbia Real Estate Equity Fund, Inc.
Columbia Balanced Fund, Inc.
Columbia Daily Income Company
Columbia U.S. Government Securities Fund, Inc.
Columbia Fixed Income Securities Fund, Inc.
Columbia Municipal Bond Fund, Inc.
Columbia High Yield Fund, Inc.
Columbia National Municipal Bond Fund, Inc.
WT Funds
Kalmar Pooled Investment Trust
The RBB Fund, Inc.
Robertson Stephens Investment Trust
-15-
<PAGE>
HT Insight Funds, Inc.
Harris Insight Funds Trust
Hilliard-Lyons Government Fund, Inc
Hilliard-Lyons Growth Fund, Inc.
The Rodney Square Fund, Inc.
The Rodney Square Tax-Exempt Fund, Inc.
The Rodney Square Strategic Equity Fund, Inc.
The Rodney Square Strategic Fixed-Income Fund, Inc.
The BlackRock Funds, Inc. (Distributed by BlackRock Distributors,
Inc. a wholly owned subsidiary of Provident Distributors, Inc.)
The OffitBank Investment Fund, Inc. (Distributed by Offit Funds
Distributor, Inc. a wholly owned subsidiary of Provident
Distributors, Inc.)
The OffitBank Variable Insurance Fund, Inc.
(Distributed by Offit Funds Distributor, Inc. a wholly owned
subsidiary of Provident Distributors, Inc.)
CVO Greater China Fund, Inc. (Distributed by Offit Funds
Distributor, Inc. a wholly owned subsidiary of Provident
Distributors, Inc.)
(b) The information required by this item 29(b) is incorporated
by reference to Form BD (SEC File No. 8-46564) filed by the
Distributor with the Securities and Exchange Commission pursuant to
the Securities Exchange Act of 1934.
Item 28. LOCATION OF ACCOUNTS AND RECORDS
(1) PFPC Trust Company (assignee under custodian agreement), 400
Bellevue Parkway, Wilmington, Delaware 19809 (records relating to
its functions as sub-adviser and custodian).
(2) Provident Distributors, Inc., Four Falls Corporate Center, 6th
Floor, West Conshohocken, PA 19428 (records relating to its
functions as distributor).
(3) BlackRock 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., Bellevue Corporate Center, 400 Bellevue Parkway,
Wilmington, Delaware 19809 (records relating to its functions as
transfer agent and dividend disbursing agent).
(5) Drinker Biddle & Reath LLP, One Logan Square, 18th and Cherry
Streets, Pennsylvania 19103 (Registrant's Articles of
Incorporation, By-Laws and Minute Books).
(6) Numeric Investors, L.P., 1 Memorial Drive, Cambridge,
Massachusetts 02142 (records relating to its function as
investment adviser).
(7) Boston Partners Asset Management, L.P., One Financial Center,
43rd Floor, Boston, Massachusetts 02111 (records relating to its
function as investment adviser).
(8) Schneider Capital Management Co., 460 East Swedesford Road, Suite
1080, Wayne, Pennsylvania 19087 (records relating to its function
as investment adviser).
(9) Custodial Trust Company, 101 Carnegie Center, Princeton, New
Jersey 08540 (records relating to its functions as custodian).
(10) Bogle Investment Management, L.P., 57 River Street, Suite 206,
Wellesley, Massachusetts 02481 (records relating to its function
as investment adviser)
-16-
<PAGE>
Item 29. MANAGEMENT SERVICES
None.
Item 30. 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.
(b) Registrant hereby undertakes to furnish each person to whom a
prospectus is delivered a copy of Registrant's latest annual
report to shareholders upon request and without charge.
-17-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, and the Investment Company Act of 1940, as amended, the Registrant has
duly caused this Post-Effective Amendment No. 67 to the Registration Statement
to be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Wilmington, and State of Delaware, on the 30th day of September, 1999.
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.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ------ ----
<S> <C> <C>
/s/ Edward J. Roach President (Principal Executive September 30, 1999
----------------------------------- Officer) and Treasurer (Principal
Edward J. Roach Financial and Accounting Officer)
*Donald van Roden Director September 30, 1999
-----------------------------------
Donald van Roden
*Francis J. McKay Director September 30, 1999
-----------------------------------
Francis J. McKay
*Marvin E. Sternberg Director September 30, 1999
-----------------------------------
Marvin E. Sternberg
*Julian A. Brodsky Director September 30, 1999
-----------------------------------
Julian A. Brodsky
*Arnold M. Reichman Director September 30, 1999
-----------------------------------
Arnold M. Reichman
*Robert Sablowsky Director September 30, 1999
-----------------------------------
Robert Sablowsky
*By: /s/ Edward J. Roach September 30, 1999
-------------------
Edward J. Roach
Attorney-in-Fact
</TABLE>
-18-
<PAGE>
THE RBB FUND, INC.
(the "Company")
POWER OF ATTORNEY
-----------------
Know All Men by These Presents, that the undersigned, Donald van Roden,
hereby constitutes and appoints Edward J. Roach and Michael P. Malloy, his true
and lawful attorneys, to execute in his name, place, and stead, in his capacity
as Director or officer, or both, of the Company, the Registration Statement and
any amendments thereto and all instruments necessary or incidental in connection
therewith, and to file the same with the Securities and Exchange Commission; and
said attorneys shall have full power and authority to do and perform in his name
and on his behalf, in any and all capacities, every act whatsoever requisite or
necessary to be done in the premises, as fully and to all intents and purposes
as he might or could do in person, said acts of said attorneys being hereby
ratified and approved.
DATED: April 23, 1997
/s/ Donald van Roden
- ----------------------------
Donald van Roden
<PAGE>
THE RBB FUND, INC.
(the "Company")
POWER OF ATTORNEY
-----------------
Know All Men by These Presents, that the undersigned, Marvin E. Sternberg,
hereby constitutes and appoints Edward J. Roach and Michael P. Malloy, his true
and lawful attorneys, to execute in his name, place, and stead, in his capacity
as Director or officer, or both, of the Company, the Registration Statement and
any amendments thereto and all instruments necessary or incidental in connection
therewith, and to file the same with the Securities and Exchange Commission; and
said attorneys shall have full power and authority to do and perform in his name
and on his behalf, in any and all capacities, every act whatsoever requisite or
necessary to be done in the premises, as fully and to all intents and purposes
as he might or could do in person, said acts of said attorneys being hereby
ratified and approved.
DATED: April 23, 1997
/s/ Marvin E. Sternberg
- ---------------------------
Marvin E. Sternberg
<PAGE>
THE RBB FUND, INC.
(the "Company")
POWER OF ATTORNEY
-----------------
Know All Men by These Presents, that the undersigned, Arnold Reichman,
hereby constitutes and appoints Edward J. Roach and Michael P. Malloy, his true
and lawful attorneys, to execute in his name, place, and stead, in his capacity
as Director or officer, or both, of the Company, the Registration Statement and
any amendments thereto and all instruments necessary or incidental in connection
therewith, and to file the same with the Securities and Exchange Commission; and
said attorneys shall have full power and authority to do and perform in his name
and on his behalf, in any and all capacities, every act whatsoever requisite or
necessary to be done in the premises, as fully and to all intents and purposes
as he might or could do in person, said acts of said attorneys being hereby
ratified and approved.
DATED: April 23, 1997
/s/ Arnold Reichman
- ---------------------------
Arnold Reichman
<PAGE>
THE RBB FUND, INC.
(the "Company")
POWER OF ATTORNEY
-----------------
Know All Men by These Presents, that the undersigned, Francis J. McKay,
hereby constitutes and appoints Edward J. Roach and Michael P. Malloy, his true
and lawful attorneys, to execute in his name, place, and stead, in his capacity
as Director or officer, or both, of the Company, the Registration Statement and
any amendments thereto and all instruments necessary or incidental in connection
therewith, and to file the same with the Securities and Exchange Commission; and
said attorneys shall have full power and authority to do and perform in his name
and on his behalf, in any and all capacities, every act whatsoever requisite or
necessary to be done in the premises, as fully and to all intents and purposes
as he might or could do in person, said acts of said attorneys being hereby
ratified and approved.
DATED: April 23, 1997
/s/ Francis J. McKay
- ---------------------------
Francis J. McKay
<PAGE>
THE RBB FUND, INC.
(the "Company")
POWER OF ATTORNEY
-----------------
Know All Men by These Presents, that the undersigned, Julian Brodsky,
hereby constitutes and appoints Edward J. Roach and Michael P. Malloy, his true
and lawful attorneys, to execute in his name, place, and stead, in his capacity
as Director or officer, or both, of the Company, the Registration Statement and
any amendments thereto and all instruments necessary or incidental in connection
therewith, and to file the same with the Securities and Exchange Commission; and
said attorneys shall have full power and authority to do and perform in his name
and on his behalf, in any and all capacities, every act whatsoever requisite or
necessary to be done in the premises, as fully and to all intents and purposes
as he might or could do in person, said acts of said attorneys being hereby
ratified and approved.
DATED: April 23, 1997
/s/ Julian Brodsky
- -------------------------
Julian Brodsky
<PAGE>
THE RBB FUND, INC.
(the "Company")
POWER OF ATTORNEY
-----------------
Know All Men by These Presents, that the undersigned, Robert Sablowsky,
hereby constitutes and appoints Edward J. Roach and Michael P. Malloy, his true
and lawful attorneys, to execute in his name, place, and stead, in his capacity
as Director or officer, or both, of the Company, the Registration Statement and
any amendments thereto and all instruments necessary or incidental in connection
therewith, and to file the same with the Securities and Exchange Commission; and
said attorneys shall have full power and authority to do and perform in his name
and on his behalf, in any and all capacities, every act whatsoever requisite or
necessary to be done in the premises, as fully and to all intents and purposes
as he might or could do in person, said acts of said attorneys being hereby
ratified and approved.
DATED: April 23, 1997
/s/ Robert Sablowsky
- ---------------------------
Robert Sablowsky
<PAGE>
THE RBB FUND, INC.
EXHIBIT INDEX
-------------
Exhibits
- --------
(a) (25) Articles Supplementary.
(d) (3) Assumption Agreement (Money Market Fund) between PNC Bank, N.A.
and BlackRock Institutional Management Corporation dated
April 29, 1998.
(d) (6) Assumption Agreement (Municipal Money Market Fund) between
PNC Bank, N.A. and BlackRock Institutional Management
Corporation dated April 29, 1998.
(d) (9) Assumption Agreement (Government Obligations Money Market
Fund) between PNC Bank, N.A. and BlackRock Institutional
Management Corporation dated April 29, 1998.
(d) (25) Investment Advisory Agreement between Registrant and
Bogle Investment Management, L.P. (Bogle Small Cap Growth
Fund).
(e) (1) Distribution Agreement between Registrant and Provident
Distributors, Inc. dated as of June 25, 1999.
(e) (2) Distribution Agreement Supplement between Registrant and
Provident Distributors, Inc. (Bogle Small Cap Growth Fund-
Institutional Class and Investor Class).
(g) (15) Custodian Agreement Supplement between Registrant and PFPC
Trust Company (Bogle Small Cap Growth Fund).
(h) (51) Transfer Agency Agreement Supplement between Registrant
and PFPC, Inc. (Bogle Small Cap Growth Fund).
(h) (52) Administrative Services Agreement between Registrant and
Provident Distributors, Inc. (Bogle Small Cap Growth Fund).
(h) (53) Non 12b-1 Shareholder Services Plan and Servicing Agreement for
Bogle Small Cap Growth Investor Shares.
(h) (54) Form of agreement between E-TRADE Group, Inc., Registrant and
Registrant's principal underwriter.
(i) Opinion of Drinker Biddle & Reath LLP.
(j) (1) Consent of Drinker Biddle & Reath LLP.
(l) (17) Purchase Agreement between Registrant and Bogle Investment
Management, L.P. (Bogle Small Cap Growth Fund).
<PAGE>
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:
(1) classifying an additional one hundred million (100,000,000) of
the previously authorized, unissued and unclassified shares of the common
stock, par value $.001 per share, with an aggregate par value of one
hundred thousand dollars ($100,000), as Class NNN Common Stock
(Institutional Class of the Bogle Investment Management Small Cap Growth
Fund); and
(2) classifying an additional one hundred million (100,000,000) of
the previously authorized, unissued and unclassified shares of the common
stock, par value $.001 per share, with an aggregate par value of one
hundred thousand dollars ($100,000), as Class OOO Common Stock (Investor
Class of the Bogle Investment Management Small Cap Growth 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 of 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.
The shares of Class NNN Common Stock and Class OOO Common Stock will
be issued without stock certificates.
The shares of Class NNN Common Stock and Class OOO Common Stock shall
be invested in a common investment portfolio, with shares of Class NNN Common
Stock
<PAGE>
representing the Institutional Shares of the Bogle Investment Management Small
Cap Growth Fund investment portfolio and shares of Class OOO Common Stock
representing Investor Shares of the Bogle Investment Management Small Cap Growth
Fund investment portfolio.
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.
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:
-2-
<PAGE>
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 five hundred million (1,500,000,000), 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;
-3-
<PAGE>
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 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 II - one hundred million (100,000,000), par value $.001 per share;
Class JJ - one hundred million (100,000,000), par value $.001 per share;
Class KK - one hundred million (100,000,000), par value $.001 per share;
Class LL - one hundred million (100,000,000), par value $.001 per share;
Class MM - one hundred million (100,000,000), par value $.001 per share;
Class NN - one hundred million (100,000,000), par value $.001 per share;
Class OO - one hundred million (100,000,000), par value $.001 per share;
Class PP - one hundred million (100,000,000), par value $.001 per share;
Class QQ - one hundred million (100,000,000), par value $.001 per share;
Class RR - one hundred million (100,000,000), par value $.001 per share;
Class SS - one hundred million (100,000,000), par value $.001 per share;
-4-
<PAGE>
Class TT - one hundred million (100,000,000), par value $.001 per share;
Class UU - one hundred million (100,000,000), par value $.001 per share;
Class VV - one hundred million (100,000,000), par value $.001 per share;
Class WW - one hundred million (100,000,000), par value $.001 per share;
Class XX - fifty million (50,000,0000), par value $.001 per share;
Class YY - one hundred million (100,000,000), par value $.001;
Class ZZ - one hundred million (100,000,000), par value $.001;
Class AAA - one hundred million (100,000,000), par value $.001;
Class BBB - one hundred million (100,000,000), par value $.001;
Class CCC - one hundred million (100,000,000), par value $.001;
Class DDD - one hundred million (100,000,000), par value $.001;
Class EEE - one hundred million (100,000,000), par value $.001;
Class FFF - one hundred million (100,000,000), par value $.001;
Class GGG - one hundred million (100,000,000), par value $.001;
Class HHH - one hundred million (100,000,000), par value $.001;
Class III - one hundred million (100,000,000), par value $.001;
Class JJJ - one hundred million (100,000,000), par value $.001;
Class KKK - one hundred million (100,000,000), par value $.001;
Class LLL - one hundred million (100,000,000), par value $.001;
Class MMM - one hundred million (100,000,000), par value $.001;
Class Janney Money - three billion (3,000,000,000), par value
$.001 per share;
Class Janney - two hundred million (200,000,000), par
Municipal Money value $.001 per share;
-5-
<PAGE>
Class Janney - seven hundred million (700,000,000), par
Government Money value $.001 per share;
Class Janney N.Y. - one hundred million (100,000,000), par
Municipal Money value $.001 per share;
Class Select - seven hundred million (700,000,000), 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 Principal Money - seven hundred million (700,000,000), 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 - 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;
-6-
<PAGE>
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;
and
Class Theta 4 - one million (1,000,000), par value $.001 per share;
for a total of nineteen billion eight hundred twenty-six million
(19,826,000,000) 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;
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 five hundred million (1,500,000,000), par value
$.001
-7-
<PAGE>
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;
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;
-8-
<PAGE>
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 II - one hundred million (100,000,000), par value $.001 per share;
Class JJ - one hundred million (100,000,000), par value $.001 per share;
Class KK - one hundred million (100,000,000), par value $.001 per share;
Class LL - one hundred million (100,000,000), par value $.001 per share;
Class MM - one hundred million (100,000,000), par value $.001 per share;
Class NN - one hundred million (100,000,000), par value $.001 per share;
Class OO - one hundred million (100,000,000), par value $.001 per share;
Class PP - one hundred million (100,000,000), par value $.001 per share;
Class QQ - one hundred million (100,000,000), par value $.001 per share;
Class RR - one hundred million (100,000,000), par value $.001 per share;
Class SS - one hundred million (100,000,000), par value $.001 per share;
Class TT - one hundred million (100,000,000), par value $.001 per share;
Class UU - one hundred million (100,000,000), par value $.001 per share;
Class VV - one hundred million (100,000,000), par value $.001 per share;
Class WW - one hundred million (100,000,000), par value $.001 per share;
Class XX - fifty million (50,000,000), par value $.001 per share;
Class YY - one hundred million (100,000,000), par value $.001;
Class ZZ - one hundred million (100,000,000), par value $.001;
Class AAA - one hundred million (100,000,000), par value $.001;
Class BBB - one hundred million (100,000,000), par value $.001;
-9-
<PAGE>
Class CCC - one hundred million (100,000,000), par value $.001;
Class DDD - one hundred million (100,000,000), par value $.001;
Class EEE - one hundred million (100,000,000), par value $.001;
Class FFF - one hundred million (100,000,000), par value $.001;
Class GGG - one hundred million (100,000,000), par value $.001;
Class HHH - one hundred million (100,000,000), par value $.001;
Class III - one hundred million (100,000,000), par value $.001;
Class JJJ - one hundred million (100,000,000), par value $.001;
Class KKK - one hundred million (100,000,000), par value $.001;
Class LLL - one hundred million (100,000,000), par value $.001;
Class MMM - one hundred million (100,000,000), par value $.001;
Class NNN - one hundred million (100,000,000), par value $.001;
Class OOO - one hundred million (100,000,000), par value $.001;
Class Janney Money - three billion (3,000,000,000), par value $.001 per
share;
Class Janney - two hundred million (200,000,000), par
Municipal Money value $.001 per share;
Class Janney - seven hundred million (700,000,000), par
Government Money value $.001 per share;
Class Janney - one hundred million (100,000,000), par
N.Y. Municipal value $.001 per share;
Money
Class Select - seven hundred million (700,000,000), 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;
-10-
<PAGE>
Class Principal Money seven hundred million (700,000,000), 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 - 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;
-11-
<PAGE>
Class Theta 4 - one million (1,000,000), par value $.001 per share;
for a total of twenty billion twenty six million (20,026,000,000) shares
classified into separate classes of common stock.
IN WITNESS WHEREOF, The RBB Fund, Inc. has caused these presents to be
signed in its name and on its behalf by its President and witnessed by its
Secretary on September 15, 1999.
THE RBB FUND, INC.
WITNESS:
/s/ Morgan R. Jones /s/ Edward J. Roach
---------------- ---------------
Morgan R. Jones Edward J. Roach
Secretary President
-12-
<PAGE>
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 that the foregoing
Articles Supplementary are the act of the 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.
/s/ Edward J. Roach
---------------
Edward J. Roach
President
-13-
<PAGE>
ASSUMPTION
AGREEMENT made as of April 29, 1998 between PNC Bank, N.A., a national
banking association ("PNC Bank"), and BlackRock Institutional Management
Corporation, a Delaware corporation ("BIMC"), formerly PNC Institutional
Management Corporation ("PIMC").
WHEREAS, The RBB Fund, Inc. (the "Company") is registered as an open-end
management investment company under the Investment Company Act of 1940;
WHEREAS, BIMC is investment adviser to the Money Market Portfolio pursuant
to an Advisory Agreement dated August 16, 1988 between PIMC and the Company and
PNC Bank is sub-adviser to the Company pursuant to a Sub-Advisory Agreement
dated August 16, 1988 between PIMC and PNC Bank;
WHEREAS, PNC Bank is transferring to BIMC the personnel engaged in, and the
computer and other facilities used in performing, PNC Bank's obligations under
the Sub-Advisory Agreement;
WHEREAS, BIMC and PNC Bank desire to have BIMC assume the obligations of
PNC Bank under the Sub-Advisory Agreement and to eliminate BIMC's obligation to
pay for such sub-advisory services;
NOW THEREFORE, the parties hereto, intending to be legally bound, agree as
follows:
1. BIMC hereby assumes all obligations of PNC Bank under the Sub-Advisory
Agreement, and PNC Bank acknowledges that compensation by BIMC to it provided of
in Section 9 of the Sub-Advisory Agreement shall terminate as of the date
hereof.
2. BIMC shall indemnify, defend and hold PNC Bank harmless from and
against any loss, damages or expense (including legal fees and expenses),
relating to the performance or nonperformance by BIMC of the obligations of PNC
Bank under the Sub-Advisory Agreement that are being assumed by BIMC pursuant to
this Assumption Agreement, that pertain to the period beginning with the date of
this Assumption Agreement.
3. PNC Bank shall indemnify, defend and hold BIMC harmless from and
against any loss, damages, expense or interest (including legal fees and
expenses) relating to the performance or nonperformance by PNC Bank of the
obligations of PNC Bank contained in the Sub-Advisory Agreement that pertain to
the period ending on the date immediately preceding the date of this Assumption
Agreement.
<PAGE>
IN WITNESS WHEREOF, intending to be legally bound hereby, the parties
hereto have caused this instrument to be executed by their officers designated
below as of the day and year first above written.
BLACKROCK INSTITUTIONAL MANAGEMENT
CORPORATION
By:
---------------------------
(Authorized Officer)
PNC BANK, N.A.
By:
---------------------------
(Authorized Officer)
-2-
<PAGE>
ASSUMPTION
AGREEMENT made as of April 29, 1998 between PNC Bank, N.A., a national
banking association ("PNC Bank"), and BlackRock Institutional Management
Corporation, a Delaware corporation ("BIMC"), formerly PNC Institutional
Management Corporation ("PIMC").
WHEREAS, The RBB Fund, Inc. (the "Company") is registered as an open-end
management investment company under the Investment Company Act of 1940;
WHEREAS, BIMC is investment adviser to the Municipal Money Market Portfolio
pursuant to an Advisory Agreement dated August 16, 1988 between PIMC and the
Company and PNC Bank is sub-adviser to the Company pursuant to a Sub-Advisory
Agreement dated August 16, 1988 between PIMC and PNC Bank;
WHEREAS, PNC Bank is transferring to BIMC the personnel engaged in, and the
computer and other facilities used in performing, PNC Bank's obligations under
the Sub-Advisory Agreement;
WHEREAS, BIMC and PNC Bank desire to have BIMC assume the obligations of
PNC Bank under the Sub-Advisory Agreement and to eliminate BIMC's obligation to
pay for such sub-advisory services;
NOW THEREFORE, the parties hereto, intending to be legally bound, agree as
follows:
1. BIMC hereby assumes all obligations of PNC Bank under the Sub-Advisory
Agreement, and PNC Bank acknowledges that compensation by BIMC to it provided of
in Section 9 of the Sub-Advisory Agreement shall terminate as of the date
hereof.
2. BIMC shall indemnify, defend and hold PNC Bank harmless from and
against any loss, damages or expense (including legal fees and expenses),
relating to the performance or nonperformance by BIMC of the obligations of PNC
Bank under the Sub-Advisory Agreement that are being assumed by BIMC pursuant to
this Assumption Agreement, that pertain to the period beginning with the date of
this Assumption Agreement.
3. PNC Bank shall indemnify, defend and hold BIMC harmless from and
against any loss, damages, expense or interest (including legal fees and
expenses) relating to the performance or nonperformance by PNC Bank of the
obligations of PNC Bank contained in the Sub-Advisory Agreement that pertain to
the period ending on the date immediately preceding the date of this Assumption
Agreement.
<PAGE>
IN WITNESS WHEREOF, intending to be legally bound hereby, the parties
hereto have caused this instrument to be executed by their officers designated
below as of the day and year first above written.
BLACKROCK INSTITUTIONAL MANAGEMENT
CORPORATION
By:
----------------------------
(Authorized Officer)
PNC BANK, N.A.
By:
----------------------------
(Authorized Officer)
-2-
<PAGE>
ASSUMPTION
AGREEMENT made as of April 29, 1998 between PNC Bank, N.A., a national
banking association ("PNC Bank"), and BlackRock Institutional Management
Corporation, a Delaware corporation ("BIMC"), formerly PNC Institutional
Management Corporation ("PIMC").
WHEREAS, The RBB Fund, Inc. (the "Company") is registered as an open-end
management investment company under the Investment Company Act of 1940;
WHEREAS, BIMC is investment adviser to the Government Obligations Money
Market Portfolio pursuant to an Advisory Agreement dated August 16, 1988 between
PIMC and the Company and PNC Bank is sub-adviser to the Company pursuant to a
Sub-Advisory Agreement dated August 16, 1988 between PIMC and PNC Bank;
WHEREAS, PNC Bank is transferring to BIMC the personnel engaged in, and the
computer and other facilities used in performing, PNC Bank's obligations under
the Sub-Advisory Agreement;
WHEREAS, BIMC and PNC Bank desire to have BIMC assume the obligations of
PNC Bank under the Sub-Advisory Agreement and to eliminate BIMC's obligation to
pay for such sub-advisory services;
NOW THEREFORE, the parties hereto, intending to be legally bound, agree as
follows:
1. BIMC hereby assumes all obligations of PNC Bank under the Sub-Advisory
Agreement, and PNC Bank acknowledges that compensation by BIMC to it provided of
in Section 9 of the Sub-Advisory Agreement shall terminate as of the date
hereof.
2. BIMC shall indemnify, defend and hold PNC Bank harmless from and
against any loss, damages or expense (including legal fees and expenses),
relating to the performance or nonperformance by BIMC of the obligations of PNC
Bank under the Sub-Advisory Agreement that are being assumed by BIMC pursuant to
this Assumption Agreement, that pertain to the period beginning with the date of
this Assumption Agreement.
3. PNC Bank shall indemnify, defend and hold BIMC harmless from and
against any loss, damages, expense or interest (including legal fees and
expenses) relating to the performance or nonperformance by PNC Bank of the
obligations of PNC Bank contained in the Sub-Advisory Agreement that pertain to
the period ending on the date immediately preceding the date of this Assumption
Agreement.
<PAGE>
IN WITNESS WHEREOF, intending to be legally bound hereby, the parties
hereto have caused this instrument to be executed by their officers designated
below as of the day and year first above written.
BLACKROCK INSTITUTIONAL MANAGEMENT
CORPORATION
By:
-----------------------------
(Authorized Officer)
PNC BANK, N.A.
By:
-----------------------------
(Authorized Officer)
-2-
<PAGE>
INVESTMENT ADVISORY AGREEMENT
-----------------------------
Bogle Investment Management Small Cap Growth Fund
AGREEMENT made as of September 15, 1999 between THE RBB FUND, INC., a
Maryland corporation (herein called the "Fund"), and Bogle Investment
Management, L. P. (herein called the "Investment Advisor").
WHEREAS, the Fund is registered as an open-end, management investment
company under the Investment Company Act of 1940 (the "1940 Act") and currently
offers or proposes to offer shares representing interests in separate investment
portfolios; and
WHEREAS, the Fund desires to retain the Investment Advisor to render
certain investment advisory services to the Fund with respect to the Fund's
Bogle Investment Management Small Cap Growth Fund (the "Portfolio"), and the
Investment Advisor is willing to so render such services.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and intending to be legally bound hereby, it is agreed between
the parties hereto as follows:
1. Appointment. The Fund hereby appoints the Investment Advisor to act as
-----------
investment advisor for the Portfolio for the period and on the terms set forth
in this Agreement. The Investment Advisor accepts such appointment and agrees to
render the services herein set forth, for the compensation herein provided.
2. Delivery of Documents. The Fund has furnished the Investment Advisor
---------------------
with copies properly certified or authenticated of each of the following:
(a) Resolutions of the Board of Directors of the Fund authorizing the
appointment of the Investment Advisor and the execution and delivery of
this Agreement;
(b) Each prospectus and statement of additional information relating
to any class of Shares representing interests in the Portfolio of the Fund in
effect under the Securities Act of 1933 (the "1933 Act") (such prospectus and
statement of additional information, as presently in effect and as they shall
from time to time be amended and supplemented, are herein collectively called
the "Prospectus" and "Statement of Additional Information," respectively).
The Fund will promptly furnish the Investment Advisor from time to time
with copies, properly certified or authenticated, of all amendments of or
supplements to the
<PAGE>
foregoing, if any.
In addition to the foregoing, the Fund will also provide the Investment
Advisor with copies of the Fund's Charter and By-laws, and any registration
statement or service contracts related to the Portfolio, and will promptly
furnish the Investment Advisor with any amendments of or supplements to such
documents.
3. Management of the Portfolio. Subject to the supervision of the Board of
---------------------------
Directors of the Fund, the Investment Advisor will provide for the overall
management of the Portfolio including (i) the provision of a continuous
investment program for the Portfolio, including investment research and
management with respect to all securities, investments, cash and cash
equivalents in the Portfolio, (ii) the determination from time to time of what
securities and other investments will be purchased, retained, or sold by the
Fund for the Portfolio, and (iii) the placement from time to time of orders for
all purchases and sales made for the Portfolio. The Investment Advisor will
provide the services rendered by it hereunder in accordance with the Portfolio's
investment objectives, restrictions and policies as stated in the applicable
Prospectus and the Statement of Additional Information, provided that the
Investment Advisor has actual notice or knowledge of any changes by the Board of
Directors to such investment objectives, restrictions or policies. The
Investment Advisor further agrees that it will render to the Fund's Board of
Directors such periodic and special reports regarding the performance of its
duties under this Agreement as the Board may reasonably request. The Investment
Advisor agrees to provide to the Fund (or its agents and service providers)
prompt and accurate data with respect to the Portfolio's transactions and, where
not otherwise available, the daily valuation of securities in the Portfolio.
4. Brokerage. Subject to the Investment Advisor's obligation to obtain
---------
best price and execution, the Investment Advisor shall have full discretion to
select brokers or dealers to effect the purchase and sale of securities. When
the Investment Advisor places orders for the purchase or sale of securities for
the Portfolio, in selecting brokers or dealers to execute such orders, the
Investment Advisor is expressly authorized to consider the fact that a broker or
dealer has furnished statistical, research or other information or services for
the benefit of the Portfolio directly or indirectly. Without limiting the
generality of the foregoing, the Investment Advisor is authorized to cause the
Portfolio to pay brokerage commissions which may be in excess of the lowest
rates available to brokers who execute transactions for the Portfolio or who
otherwise provide brokerage and research services utilized by the Investment
Advisor, provided that the Investment Advisor determines in good faith that the
amount of each such commission paid to a broker is reasonable in relation to the
value of the
-2-
<PAGE>
brokerage and research services provided by such broker viewed in terms of
either the particular transaction to which the commission relates or the
Investment Advisor's overall responsibilities with respect to accounts as to
which the Investment Advisor exercises investment discretion. The Investment
Advisor may aggregate securities orders so long as the Investment Advisor
adheres to a policy of allocating investment opportunities to the Portfolio over
a period of time on a fair and equitable basis relative to other clients. In no
instance will the Portfolio's securities be purchased from or sold to the Fund's
principal underwriter, the Investment Advisor, or any affiliated person thereof,
except to the extent permitted by SEC exemptive order or by applicable law.
The Investment Advisor shall report to the Board of Directors of the Fund
at least quarterly with respect to brokerage transactions that were entered into
by the Investment Advisor, pursuant to the foregoing paragraph, and shall
certify to the Board that the commissions paid were reasonable in terms either
of that transaction or the overall responsibilities of the Advisor to the Fund
and the Investment Advisor's other clients, that the total commissions paid by
the Fund were reasonable in relation to the benefits to the Fund over the long
term, and that such commissions were paid in compliance with Section 28(e) of
the Securities Exchange Act of 1934.
5. Conformity with Law; Confidentiality. The Investment Advisor further
------------------------------------
agrees that it will comply with all applicable rules and regulations of all
federal regulatory agencies having jurisdiction over the Investment Advisor in
the performance of its duties hereunder. The Investment Advisor will treat
confidentially and as proprietary information of the Fund all records and other
information relating to the Fund and will not use such records and information
for any purpose other than performance of its responsibilities and duties
hereunder, except after prior notification to and approval in writing by the
Fund, which approval shall not be unreasonably withheld and may not be withheld
where the Investment Advisor may be exposed to civil or criminal contempt
proceedings for failure to comply, when requested to divulge such information by
duly constituted authorities, or when so requested by the Fund.
6. Services Not Exclusive. The Investment Advisor and its officers may act
----------------------
and continue to act as investment managers for others, and nothing in this
Agreement shall in any way be deemed to restrict the right of the Investment
Advisor to perform investment management or other services for any other person
or entity, and the performance of such services for others shall not be deemed
to violate or give rise to any duty or obligation to the Portfolio or the Fund.
Nothing in this Agreement shall limit or restrict the Investment Advisor or
any of its partners, officers, affiliates
-3-
<PAGE>
or employees from buying, selling or trading in any securities for its or their
own account. The Fund acknowledges that the Investment Advisor and its partners,
officers, affiliates, employees and other clients may, at any time, have,
acquire, increase, decrease, or dispose of positions in investments which are at
the same time being acquired or disposed of for the Portfolio. The Investment
Advisor shall have no obligation to acquire for the Portfolio a position in any
investment which the Investment Advisor, its partners, officers, affiliates or
employees may acquire for its or their own accounts or for the account of
another client, so long as it continues to be the policy and practice of the
Investment Advisor not to favor or disfavor consistently or consciously any
client or class of clients in the allocation of investment opportunities so
that, to the extent practical, such opportunities will be allocated among
clients over a period of time on a fair and equitable basis.
The Investment Advisor agrees that this Paragraph 6 does not constitute a
waiver by the Fund of the obligations imposed upon the Investment Advisor to
comply with Sections 17(d) and 17(j) of the 1940 Act, and the rules thereunder,
nor constitute a waiver by the Fund of the obligations imposed upon the
Investment Advisor under Section 206 of the Investment Advisers Act of 1940 and
the rules thereunder. Further, the Investment Advisor agrees that this
Paragraph 6 does not constitute a waiver by the Fund of the fiduciary obligation
of the Investment Advisor arising under federal or state law, including Section
36 of the 1940 Act. The Investment Advisor agrees that this Paragraph 6 shall
be interpreted consistent with the provisions of Section 17(i) of the 1940 Act.
7. Books and Records. In compliance with the requirements of Rule 31a-3
-----------------
under the 1940 Act, the Investment Advisor hereby agrees that all records which
it maintains for the Portfolio are the property of the Fund and further agrees
to surrender promptly to the Fund any of such records upon the Fund's request.
The Investment Advisor further agrees to preserve for the periods prescribed by
Rule 31a-2 under the 1940 Act the records required to be maintained by Rule
31a-1 under the 1940 Act.
8. Expenses. During the term of this Agreement, the Investment Advisor
--------
will pay all expenses incurred by it in connection with its activities under
this Agreement. The Portfolio shall bear all of its own expenses not
specifically assumed by the Investment Advisor. General expenses of the Fund not
readily identifiable as belonging to a portfolio of the Fund shall be allocated
among all investment portfolios by or under the direction of the Fund's Board of
Directors in such manner as the Board determines to be fair and equitable.
Expenses borne by the Portfolio shall include, but are not limited to, the
following (or the portfolio's share of the following): (a) the cost (including
brokerage commissions) of securities purchased or
-4-
<PAGE>
sold by the Portfolio and any losses incurred in connection therewith; (b) fees
payable to and expenses incurred on behalf of the Portfolio by the Investment
Advisor; (c) filing fees and expenses relating to the registration and
qualification of the Fund and the Portfolio's shares under federal and/or state
securities laws and maintaining such registrations and qualifications; (d) fees
and salaries payable to the Fund's directors and officers; (e) taxes (including
any income or franchise taxes) and governmental fees; (f) costs of any liability
and other insurance or fidelity bonds; (g) any costs, expenses or losses arising
out of a liability of or claim for damages or other relief asserted against the
Fund or the Portfolio for violation of any law; (h) legal, accounting and
auditing expenses, including legal fees of special counsel for the independent
directors; (i) charges of custodians and other agents; (j) expenses of setting
in type and printing prospectuses, statements of additional information and
supplements thereto for existing shareholders, reports, statements, and
confirmations to shareholders and proxy material that are not attributable to a
class; (k) 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; (1) any
extraordinary expenses; (m) fees, voluntary assessments and other expenses
incurred in connection with membership in investment company organizations; (n)
costs of mailing and tabulating proxies and costs of shareholders' and
directors' meetings; (o) costs of independent pricing services to value a
portfolio's securities; and (p) the costs of investment company literature and
other publications provided by the Fund 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 the Fund are
allocated to such class.
If the expenses borne by the Portfolio in any fiscal year exceed the most
restrictive applicable expense limitations imposed by the securities regulations
of any state in which the Shares of the Portfolio are registered or qualified
for sale to the public, the Investment Advisor shall reimburse the Portfolio for
any excess up to the amount of the fees payable by the Portfolio to it during
such fiscal year pursuant to Paragraph 9 hereof in the same proportion that its
fees bear to the total fees paid by the Fund for investment advisory services in
respect of the Portfolio; provided, however, that notwithstanding the foregoing,
-------- -------
the Investment Advisor shall reimburse the Portfolio for such excess expenses
regardless of the amount of such fees payable to it during such fiscal year to
the extent that the securities regulations of any state in which the Shares are
registered or qualified for sale so require.
-5-
<PAGE>
9. Voting. The Investment Advisor shall have the authority to vote as
------
agent for the Fund, either in person or by proxy, tender and take all actions
incident to the ownership of all securities in which the Portfolio's assets may
be invested from time to time, subject to such policies and procedures as the
Board of Directors of the Fund may adopt from time to time.
10. Reservation of Name. The Investment Advisor shall at all times have
-------------------
all rights in and to the Portfolio's name and all investment models used by or
on behalf of the Portfolio. The Investment Advisor may use the Portfolio's name
or any portion thereof in connection with any other mutual fund or business
activity without the consent of any shareholder and the Fund shall execute and
deliver any and all documents required to indicate the consent of the Fund to
such use.
No public reference to, or description of the Investment Advisor or its
methodology or work shall be made by the Fund, whether in the Prospectus,
Statement of Additional Information or otherwise, without the prior written
consent of the Investment Advisor, which consent shall not be unreasonably
withheld. In each case, the Fund shall provide the Investment Advisor a
reasonable opportunity to review any such reference or description before being
asked for such consent.
11. Compensation.
------------
(a) For the services provided and the expenses assumed pursuant to
this Agreement with respect to the Portfolio, the Fund will pay the Investment
Advisor from the assets of the Portfolio and the Investment Advisor will accept
as full compensation therefor a fee, computed daily and payable monthly, at the
annual rate of 1.00% of the Portfolio's average daily net assets.
(b) The fee attributable to the Portfolio shall be satisfied only
against assets of the Portfolio and not against the assets of any other
investment portfolio of the Fund.
12. Limitation of Liability of the Investment Advisor. The Investment
-------------------------------------------------
Advisor shall not be liable for any error of judgment or mistake of law or for
any loss suffered by the Fund in connection with the matters to which this
Agreement relates, except a loss resulting from a breach of fiduciary duty with
respect to the receipt of compensation for services or a loss resulting from
willful misfeasance, bad faith or gross negligence on the part of the Investment
Advisor in the performance of its duties or from reckless disregard by it of its
obligations and duties under this Agreement ("disabling conduct"). The
Portfolio will indemnify the Investment Advisor against and hold it harmless
from any and all losses, claims, damages, liabilities or expenses (including
reasonable counsel fees and expenses) resulting from any claim, demand, action
or suit not resulting
-6-
<PAGE>
from disabling conduct by the Investment Advisor. Indemnification shall be made
only following: (i) a final decision on the merits by a court or other body
before whom the proceeding was brought that the Investment Advisor was not
liable by reason of disabling conduct or (ii) in the absence of such a decision,
a reasonable determination, based upon a review of the facts, that the
Investment Advisor was not liable by reason of disabling conduct by (a) the vote
of a majority of a quorum of directors of the Portfolio who are neither
"interested persons" of the Portfolio nor parties to the proceeding
("disinterested non-party directors") or (b) an independent legal counsel in a
written opinion. The Investment Advisor shall be entitled to advances from the
Portfolio for payment of the reasonable expenses incurred by it in connection
with the matter as to which it is seeking indemnification in the manner and to
the fullest extent permissible under the Maryland General Corporation Law. The
Investment Advisor shall provide to the Portfolio a written affirmation of its
good faith belief that the standard of conduct necessary for indemnification by
the Portfolio has been met and a written undertaking to repay any such advance
if it should ultimately be determined that the standard of conduct has not been
met. In addition, at least one of the following additional conditions shall be
met: (a) the Investment Advisor shall provide a security in form and amount
acceptable to the Portfolio for its undertaking; (b) the Portfolio is insured
against losses arising by reason of the advance; or (c) a majority of a quorum
of disinterested non-party directors, or independent legal counsel, in a written
opinion, shall have determined, based upon a review of facts readily available
to the Portfolio at the time the advance is proposed to be made, that there is
reason to believe that the Investment Advisor will ultimately be found to be
entitled to indemnification. Any amounts payable by the Portfolio under this
Section shall be satisfied only against the assets of the Portfolio and not
against the assets of any other investment portfolio of the Fund.
The limitations on liability and indemnification provisions of this
paragraph 12 shall not be applicable to any losses, claims, damages, liabilities
or expenses arising from the Investment Advisor's rights to the Portfolio's
name. The Investment Advisor shall indemnify and hold harmless the Fund and the
Portfolio for any claims arising from the use of the term "Bogle Investment
Management" in the name of the Portfolio.
13. Duration and Termination. This Agreement shall become effective with
------------------------
respect to the Portfolio upon approval of this Agreement by vote of a majority
of the outstanding voting securities of the Portfolio and, unless sooner
terminated as provided herein, shall continue with respect to the Portfolio
until August 16, 2001. Thereafter, if not terminated, this Agreement shall
continue with respect to the Portfolio for successive annual periods ending on
August 16 provided such continuance is specifically approved at least annually
--------
(a) by the
-7-
<PAGE>
vote of a majority of those members of the Board of Directors of the Fund who
are not parties to this Agreement or interested persons of any such party, cast
in person at a meeting called for the purpose of voting on such approval, and
(b) by the Board of Directors of the Fund or by vote of a majority of the
outstanding voting securities of the Portfolio; provided, however, that this
-------- -------
Agreement may be terminated with respect to the Portfolio by the Fund at any
time, without the payment of any penalty, by the Board of Directors of the Fund
or by vote of a majority of the outstanding voting securities of the Portfolio,
on 60 days' prior written notice to the Investment Advisor, or by the Investment
Advisor at any time, without payment of any penalty, on 60 days' prior written
notice to the Fund. This Agreement will immediately terminate in the event of
its assignment. (As used in this Agreement, the terms "majority of the
outstanding voting securities," "interested person" and "assignment" shall have
the same meaning as such terms have in the 1940 Act).
14. Amendment of this Agreement. No provision of this Agreement may be
---------------------------
changed, discharged or terminated orally, except by an instrument in writing
signed by the party against which enforcement of the change, discharge or
termination is sought, and no amendment of this Agreement affecting the
Portfolio shall be effective until approved by vote of the holders of a majority
of the outstanding voting securities of the Portfolio.
15. Miscellaneous. The captions in this Agreement are included for
-------------
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and shall be
governed by Delaware law.
16. Change in Membership. The Investment Advisor shall notify the Fund of
--------------------
any change in its membership within a reasonable time after such change.
17. Governing Law. This Agreement shall be governed by and construed and
-------------
enforced in accordance with the laws of the State of Delaware without giving
effect to the conflicts of laws principles thereof.
18. Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
-8-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
THE RBB FUND, INC.
By: /s/ Edward J. Roach
--------------------
Edward J. Roach
President & Treasurer
BOGLE INVESTMENT MANAGEMENT, L. P.
By: /s/ John Bogle, Jr.
---------------------
John Bogle, Jr.
-9-
<PAGE>
DISTRIBUTION AGREEMENT
AGREEMENT, made as of June 25, 1999 by and between THE RBB FUND, INC.,
a Maryland corporation (the "Fund"), and PROVIDENT DISTRIBUTORS, INC., a
Delaware corporation (the "Distributor")
Background
----------
The Fund is registered as an open-end management investment company
under the Investment company Act of 1940, as amended (the "1940 Act"). The
Fund's shares of Common Stock, par value $.001 per share, have been classified
into 97 classes, and represent interests in 16 investment portfolios of the
Fund.
The Fund desires to appoint the Distributor as the distributor of the
Fund's shares of Common Stock, and the Distributor wishes to become the
distributor of shares of the Fund's Common Stock.
NOW, THEREFORE, in consideration of the premises above and of other
good and valuable consideration by each of the parties hereto to the other party
paid and of the agreements, covenants and obligations herein contained, the
parties hereto, intending to be legally bound, agree as follows:
1. Appointment. The Fund appoints the Distributor as the
-----------
distributor of each existing class of Common Stock, as designated on Exhibit A
attached herewith, as well as any future class of Common Stock, as to which the
Fund and the Distributor have entered into a Distribution Agreement Supplement
(individually, a "Class," and collectively, the "Classes") for the period and on
the terms set forth in this Agreement. The Distributor accepts such appointment
and agrees to render the services herein set forth for the compensation herein
provided. Each investment portfolio in which the shares of one or more Classes
("Class Shares") represent interests is herein called a "Portfolio." The
Distributor shall for all purposes herein be deemed to be an independent
contractor and shall, unless otherwise expressly provided herein or authorized
by the Fund's Board of Directors from time to time, have no authority to act for
or represent the Fund in any way or otherwise be deemed its agent. The services
furnished by the Distributor hereunder are not deemed exclusive, and the
Distributor shall be free to furnish similar services to others so long as its
services under this Agreement are not impaired thereby.
2. Duties of the Fund. The Fund shall use its best efforts in
------------------
maintaining registration of itself and its securities under the 1940 Act and the
Securities Act of 1933, as amended (the "1933 Act") and shall bear all expenses
in connection therewith.
The Fund shall cooperate in the qualification by the investment
adviser of the
<PAGE>
Fund of Class Shares under the laws of such states and other jurisdictions of
the United States as it shall determine and shall execute and deliver such
documents as may reasonably be required for such purpose, but the Fund shall not
be required to qualify as a foreign business entity in any jurisdiction, nor
effect any modification of its policies or practices without prior approval of
the Fund's Directors. The Fund's officers, subject to the direction of the Board
of Directors of the Fund and with the advice of the Distributor, shall determine
whether it is desirable to qualify or continue to offer Class Shares in any
jurisdiction. The Distributor shall have no obligation to assist in the
qualification of Class Shares in any jurisdiction or in the maintenance of any
qualification other than its obligation to serve as registered agent to the Fund
and execute required filings.
The Fund shall provide to the Distributor copies of the Fund's
Articles of Incorporation and all amendments thereto ("Charter") on file with
the Department of Assessments and Taxation of the State of Maryland, the Fund's
then current By-laws and all amendments thereto ("By-laws"), the Fund's current
prospectus and statement of additional information (including supplements
thereto) which relate to the Class Shares (the "Prospectus" and "SAI"), and the
Fund's current Registration Statement on Form N-1A as filed under the 1940 Act,
as such shall be amended from time to time (the "Registration Statement"). The
Fund shall provide to the Distributor such additional copies of the current
Prospectus and SAI and annual, semi-annual and other reports and communications
to shareholders which relate to the Class Shares as the Distributor may
reasonably require for sales purposes. The Fund shall also furnish the
Distributor, with respect to a Class: (a) annual audit reports of the Fund's
books and accounts made by independent public accountants regularly retained by
the Fund, (b) semi-annual unaudited financial statements pertaining to the Fund,
or one or more of the Portfolios, (c) quarterly earnings statements prepared by
the Fund, (d) a monthly itemized list of the securities held by the Portfolios,
(e) monthly balance sheets as soon as practicable after the end of each month,
(f) a survey indicating the states and jurisdictions in which each Class is
qualified for sale or exempt from the requirements of the securities laws of
such state or jurisdiction and the amounts of shares that may be sold in such
states and jurisdictions, as such may be amended from time to time ("Blue Sky
Report"), and (g) from time to time such additional information regarding the
Fund's or the Portfolios' financial condition as the Distributor may reasonably
request.
3. Duties as Distributor. The Distributor agrees to use
---------------------
appropriate efforts to solicit orders for the sale of Class Shares, and will
undertake such advertising and promotion as it believes is reasonable in
connection with such solicitation. The Distributor agrees that all solicitations
for subscriptions to Class Shares shall be made in accordance with the Charter,
the Registration Statement and the By-Laws, to the extent such documents have
been provided to the Distributor, and in accordance with the Prospectus and the
SAI, and shall not at any time or in any manner violate any provisions of the
laws of the United States or of any state or other jurisdiction in which
solicitations are then being made, or of any rules and regulations made or
adopted by duly authorized agencies thereunder, including without limitation
those promulgated by the Securities and Exchange Commission (the "SEC");
provided that the Distributor shall not be deemed to have violated any state
securities laws if it has acted in good faith and in accordance with the Blue
Sky Report. In carrying out its obligations hereunder, the Distributor shall:
-2-
<PAGE>
(a) provide to the Fund's Board of Directors, at least
quarterly, a written report of the amounts expended in connection with all
distribution services rendered pursuant to this Agreement, including an
explanation of the purposes (such as commissions, advertising, printing,
interest, carrying charges and any allocated overhead expenses) for which such
expenditures were made;
(b) monitor the arrangements pertaining to the Fund's
Shareholder Servicing Agreements ("Servicing Agreements") with shareholders of
record, other than broker/dealers, that are banks that are affiliated with PNC
Financial Corp ("Service Organizations"), including among other things,
reviewing the qualifications of Service Organizations wishing to enter into
Servicing Agreements with the Fund to ensure that such entities are banks
affiliated with PNC Financial Corp and that they are capable of performing their
duties as set forth in the Servicing Agreements, assisting in the execution and
delivery of Servicing Agreements, reporting to the Board of Directors with
respect to the amounts paid or payable by the Fund from time to time under its
Servicing Agreements and the nature of the services provided by Service
Organizations, and maintaining appropriate records in connection with its
monitoring duties; and
(c) take, on behalf of the Fund, all actions which appear to the
Fund necessary to carry into effect the distribution of the Class Shares.
4. Distribution of Class Shares. The price at which Class Shares
----------------------------
may be sold shall be the net asset value per share, plus any applicable sales
commission, computed in the manner set forth in the Fund's Prospectus and SAI in
effect at the time of sale of such Class Shares.
It is mutually understood and agreed that the Distributor does not
undertake to sell all or any specific portion of the Class Shares. The Fund
shall not sell any Class Shares except through the Distributor, except that:
(a) the Fund may issue Class Shares at their net asset value to
any shareholder of the Fund purchasing Class Shares with dividends or other
distributions received from the Fund pursuant to an offer made to all
shareholders;
(b) the Distributor may, and when requested by the Fund shall,
suspend its efforts to effectuate sales of Class Shares at any time when in the
opinion of the Distributor or of the Fund no sales should be made because of
market or other economic considerations or abnormal circumstances of any kind;
and
(c) the Fund may withdraw the offering of its Class Shares (i)
at any time with the consent of the Distributor, or (ii) without such consent
when so required by the
-3-
<PAGE>
provisions of any statute or of any order, rule or regulation of any
governmental body having jurisdiction.
Whenever in the judgment of the Fund's officers such action is warranted by
unusual market, economic or political conditions, or by abnormal circumstances
of any kind, the Fund's officers may, after notice to the Distributor, decline
to accept any orders for, or make any sales of the Class Shares until such time
as those officers deem it advisable to accept such orders and to make such
sales. In the event of such suspension of sales and until the Distributor
receives written notification from the Fund that the Distributor may resume
accepting orders for and making sales of the Class Shares, the Distributor's
duty to distribute Class Shares shall be suspended but the Fund shall continue
to remain obligated to compensate the Distributor under the terms of paragraph 7
hereof.
5. Effectiveness of Registration. None of the Class Shares shall be
offered by either the Distributor or the Fund under any of the provisions of
this Agreement and no orders for the purchase or sale of the Class Shares shall
be accepted by the Fund if and so long as the effectiveness of the Registration
Statement then in effect or any necessary amendments thereto shall be suspended
under any of the provisions of the 1933 Act or if and so long as a current
prospectus as required by Section 5(b)(2) of the 1933 Act is not on file with
the SEC; provided, however, that nothing contained in this paragraph 5 shall in
any way restrict or have an application to or bearing upon the Fund's obligation
to repurchase its Class Shares from any shareholder in accordance with the
provisions of the Prospectus, SAI or Charter.
The Fund agrees to advise the Distributor immediately in writing:
(a) of any request by the SEC for amendments to the Registration
Statement, Prospectus or SAI then in effect or for additional information;
(b) in the event of the issuance by the SEC of any stop order
suspending the effectiveness of the Registration Statement, Prospectus or SAI
then in effect or the initiation of any proceeding for that purpose;
(c) of the happening of any event that makes untrue any
statement of a material fact made in the Registration Statement, Prospectus or
SAI then in effect or that requires the making of a change in such Registration
Statement, Prospectus or SAI in order to make the statements therein not
misleading; and
(d) of all actions of the SEC with respect to any amendment to
any Registration Statement, Prospectus or SAI which may from time to time be
filed with the SEC.
For the purposes of this paragraph 5, informal requests by, or acts of the staff
of the SEC shall not be deemed actions of or requests by the SEC.
-4-
<PAGE>
6. Dealer Agreements. The Distributor may enter into dealer
-----------------
agreements ("Dealer Agreements") with any securities dealer who is registered
under the Securities Exchange Act of 1934 (the "1934 Act") and who is a member
in good standing of the National Association of Securities Dealers, Inc., who
may wish to assist in the distribution of the Class Shares. All such Dealer
Agreements shall be either in substantially the form of the agreement attached
hereto as Exhibit B or in a form that has been reviewed by counsel to the Fund.
The Distributor may negotiate the compensation to be paid pursuant to Dealer
Agreements. Such payments shall be borne by the Distributor and may not exceed
the sums paid to the Distributor under paragraph 7 of this Agreement. The actual
payments made by the Distributor and the basis for calculating such payments
shall be reported quarterly to the Board of Directors of the Fund.
7. Compensation.
------------
(a) As compensation for its services, the Distributor will be
paid fees with respect to a Class as set forth in Exhibit A opposite the name of
such Class or as set forth in any applicable Distribution Agreement Supplement.
(b) The Distributor shall waive its fee with respect to each
Class representing interests in Portfolios of the Fund that declare a daily
dividend on any day (and, with respect only to a Class that has adopted a
Shareholder Services Plan, on a pro rata basis with Servicing Organizations
under their Servicing Agreements) to the extent necessary to ensure that the fee
required to be accrued does not exceed the income accrued by the Class Shares on
such day.
(c) If this Agreement becomes effective with respect to a Class
subsequent to the first day of a month or shall terminate before the last day of
a month, the compensation of the Distributor with respect to such Class under
this Paragraph 7 for that part of the month this Agreement is in effect shall be
prorated in a manner consistent with the calculations of the fees as set forth
in the applicable Distribution Agreement Supplement. Payment of the
Distributor's compensation for the preceding month shall be made as promptly as
possible after completion of the computations contemplated in this paragraph.
8. Expenses. The expenses connected with the Fund shall be
--------
allocable between the Fund and the Distributor as follows:
(a) The Distributor shall furnish, at its expense and without
cost to the Fund, the services of personnel to the extent that such services are
required to carry out its obligations under this Agreement.
(b) The Distributor shall bear the expenses of any promotional
or sales literature used by the Distributor or furnished by the Distributor in
connection with the public
-5-
<PAGE>
offering of the Fund's Class Shares, the expenses of printing (exclusive of
typesetting) and distributing Prospectuses and SAIs to prospective shareholders,
the expenses of advertising in connection with the public offering of the Fund's
Class Shares and all legal expenses in connection with the foregoing.
(c) The Fund assumes and shall pay or cause to be paid all other
expenses of the Fund, including, without limitation: the fees of the Fund's
investment adviser and Distributor; the charges and expenses of any registrar,
any custodian or depository appointed by the Fund for the safekeeping of its
cash, portfolio securities and other property, and any stock transfer, dividend
or accounting agent or agents appointed by the Fund; brokers' commissions
chargeable to the Fund in connection with portfolio securities transactions to
which the Fund is a party; all taxes, including securities issuance and transfer
taxes, and corporate fees payable by the Fund to federal, state or other
governmental agencies; the cost and expense of engraving or printing of stock
certificates representing shares of the Fund; all costs and expenses in
connection with the organization of the Fund and the registration of shares of
the Fund with the SEC and under state securities laws and in connection with
maintenance of registration of the Fund and its shares with the SEC and various
states and other jurisdictions (including filing fees and legal fees and
disbursements of counsel); except as provided in subparagraph (b) above, the
expenses of printing, including typesetting, and distributing prospectuses of
the Fund and supplements thereto to the Fund's shareholders; all expenses of
shareholders' and Directors' meetings and of preparing, printing and mailing of
proxy statements and reports to shareholders; fees and travel expenses of
directors who are not interested persons (as such term is defined in the 1940
Act) of the Fund ("Non-Interested Directors") or members of any advisory board
or committee established by the Non-Interested Directors; all expenses incident
to the payment of any dividend, distribution, withdrawal or redemption, whether
in shares or in cash; charges and expenses of any outside service used for
pricing of the Fund's stares; charges and expenses of legal counsel, including
counsel to the Non-Interested Directors, and of independent accountants, in
connection with any matter relating to the Fund; membership dues of industry
associations; interest payable on Fund borrowings; postage; insurance premiums
on property or personnel (including officers and directors) of the Fund which
inure to its benefit; extraordinary expenses (including, but not limited to,
legal claims and liabilities and litigation costs and any indemnification
related thereto); and all other charges and costs of the Fund's operation unless
otherwise explicitly provided herein.
9. Standard of Care; Indemnity by Fund. The Distributor shall not
-----------------------------------
be liable for any error of judgment or mistake of law or for any act or omission
for any loss suffered by the Fund or any Class or Portfolio thereof in
connection with the matters to which this Agreement relates, provided that
nothing herein shall be deemed to protect or purport to protect the Distributor
against any liability to the Fund or its shareholders to which the Distributor
would otherwise be subject by reason of breach of this Agreement, willful
misfeasance, bad faith or negligence on its part in the performance of its
duties or from reckless disregard by it of its obligations and duties under this
Agreement ("Disabling Conduct").
The Fund agrees to indemnify and hold the Distributor, its officers
and directors
-6-
<PAGE>
and each person (if any) who controls the Distributor within the meaning of
Section 15 of the 1933 Act harmless from and against any and all losses, claims,
damages and liabilities including but not limited to attorney fees and
investigative expenses) which the Distributor, its officers and directors or any
such controlling person may incur under the 1940 Act, or under common law or
otherwise, caused by or alleged to exist, including amounts paid in satisfaction
of judgments, in compromise or as fines or penalties arising out of or based
upon the Distributor's acting as such under this Agreement that do not result
from Disabling Conduct, error of judgment, mistake of law or any negligent act
or omission by the Distributor. Indemnification shall be made only following:
(i) a final decision on the merits by a court or other body before whom the
proceeding was brought that the Distributor was not liable by reason of
Disabling Conduct, error of judgment, mistake of law or any negligent act or
omission or (ii) in the absence of such a decision, a reasonable determination,
based upon a review of the facts, that the Distributor was not liable by reason
of Disability Conduct, error of judgment, mistake of law or any negligent act or
omission by (a) the vote of a majority of a quorum of directors of the Fund who
are neither "interested persons" of the Fund nor parties to the proceeding
("disinterested non-party directors") or (b) an independent legal counsel in a
written opinion. The Distributor, its officers, directors and control persons
shall be entitled to advances from the Fund for payment of the reasonable
expenses incurred by it or them in connection with the matter as to which it or
they are seeking indemnification in the manner and to the fullest extent
permissible under the Maryland General Corporation law. The Distributor shall
provide to the Fund a written affirmation of its good faith belief that the
standard of conduct necessary for indemnification by the Fund has been met and a
written undertaking to repay any such advance if it should ultimately be
determined that the standard of conduct has not been met. In addition, at least
one of the following additional conditions shall be met: (a) the Distributor
shall provide a security in form and amount acceptable to the Fund for its
undertaking; (b) the Fund is insured against losses arising by reason of the
advance; or (c) a majority of a quorum of disinterested non-party directors, or
independent legal counsel selected by the disinterested directors, in a written
opinion, shall have determined, based on a review of facts readily available to
the Fund at the time the advance is proposed to be made, that there is reason to
believe that the Distributor will ultimately be found to be entitled to
indemnification.
The Distributor agrees that, promptly upon its receipt of notice of
the commencement of any action against the Distributor, its officers and/or
directors or against any person so controlling the Distributor, in respect of
which indemnity or reimbursement may be sought from the Fund on account of its
agreement in the preceding paragraph, notice in writing will be given to the
Fund within 10 days after the summons or other first legal process shall have
been served. The failure to notify the Fund of any such action shall not relieve
the Fund from any liability which the Fund may have to the person against whom
such action is brought by reason of any such alleged untrue statement or any
such liability that arises other than by reason of the indemnity agreement
contained in this paragraph. Thereupon, the Fund shall be entitled to
participate, to the extent that it shall wish (including the selection of
counsel with Distributor's reasonable approval), in the defense thereof. In the
event the Fund elects to assume the defense of any such suit and retain counsel
of good standing reasonably approved by the Distributor, the defendant or
defendants in such suit shall bear the expense of any additional counsel
retained by any of them; but in the case the Fund does not elect to assume the
defense of any such suit or in the case the Distributor does not reasonably
approve of counsel chosen by the Fund, the Fund
-7-
<PAGE>
will reimburse the Distributor, its officers and directors or the controlling
person or persons named as defendant or defendants in such suit for the fees and
expenses of only one counsel or firm which may be retained on behalf of the
Distributor, its officers and directors and such controlling persons.
In the event that any such claim for indemnification is made by any
director or person in control of the Distributor within the meaning of Section
15 of the 1933 Act who is also an officer or director of the Fund, the Fund, at
its expense to the extent permitted by law, will submit to a court of
appropriate jurisdiction the question of whether or not indemnification by it is
against public policy as expressed in the 1933 Act, the 1934 Act, and the 1940
Act, and the Fund and the Distributor will be governed by the final adjudication
of such question.
The Fund's indemnification agreement contained in this paragraph and
the Fund's representations and warranties in this agreement shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of the Distributor, its offices and directors or any controlling
person and shall survive the sale of any of the Class Shares made pursuant to
this Agreement. This agreement of indemnity will inure exclusively to the
benefit of the Distributor, its officers, directors and control persons, and to
the extent permitted by the 1940 Act or any other applicable law consistent with
the 1940 Act to the benefit of any of their successors and assigns. The Fund
agrees promptly to notify the Distributor of the commencement of any litigation
or proceeding against the Fund in connection with the issue and sale of any
Class Shares.
10. Indemnity by the Distributor. The Distributor agrees to
----------------------------
indemnify and hold harmless the Fund, its officers and directors and persons who
control the Fund within the meaning of Section 15 of the 1933 Act to the same
extent as in the foregoing indemnity from the Fund to the Distributor, but only
with respect to any untrue statement or omission or alleged untrue statement or
omission based upon information furnished in writing to the Fund by the
Distributor or by any person on behalf of or at the request of the Distributor,
excluding the Fund, expressly for use in the Registration Statement, Prospectus
or SAI. The Distributor also agrees to indemnify and hold harmless the Fund, its
officers and directors and persons who control the Fund within the meaning of
Section 15 of the 1933 Act from and against any and all losses, claims, damages
and liabilities arising by reason of any person acquiring any Class Shares,
which may be based upon the 1933 Act or any other statute or at common law, on
account of any wrongful sales activities of the Distributor or any of its
registered representatives, as defined under the By-Laws of the National
Association of Securities Dealers, Inc., including any failure to conform with
any requirement of any state and federal law relating to the sale of such Class
Shares. Notwithstanding anything contained herein to the contrary, the
Distributor shall not be responsible to the Fund for and shall not indemnify and
hold harmless the Fund, its officers and directors and persons who control the
Fund within the meaning of Section 15 of the 1933 Act from and against any such
losses, claims, damages or liabilities arising solely as a result of actions
taken or omitted by the Distributor in good faith reliance on, and in conformity
with, the Blue Sky Report.
The Distributor shall also indemnify and hold harmless the Fund, its
officers and
-8-
<PAGE>
directors and persons who control the Fund within the meaning of Section 15 of
the 1933 Act for any liability to the Fund or to the holders of Class Shares by
reason of the Distributor's willful misfeasance, bad faith or negligence in the
performance of its duties or by reason of its reckless disregard of its
obligations and duties under this Agreement. The Fund, its officers, directors
and control persons shall be entitled to advances from the Distributor for
payment of the reasonable expenses incurred by it or them in connection with the
matters as to which it or they are seeking indemnification in the manner and to
the fullest extent permissible under Maryland General Corporation law. The Fund
shall provide to the Distributor a written confirmation of its good faith belief
that the standard of conduct necessary for indemnification by the Distributor
has been met and a written undertaking to repay any such advance if it should be
determined that the standard of conduct has not been met.
In case any action shall be brought against the Fund, its officers and
directors and persons who control the Fund within the meaning of Section 15 of
the 1933 Act in respect of which it may seek indemnity or reimbursement from the
Distributor on account of the agreement of the Distributor contained in this
paragraph 10, the Distributor shall have the rights and duties given to the
Fund, and the Fund, its officers and directors and persons who control the Fund
within the meaning of Section 15 of the 1933 Act shall have the rights and
duties given to the Distributor, in the third and fourth paragraphs of paragraph
9.
11. Term. This Agreement shall become effective at the close of
----
regular trading on the New York Stock Exchange on the date hereof and shall
continue in full force and effect, subject to paragraph 14 hereof, until August
16, 1999.
12. Renewal. Following the expiration of its initial term, this
-------
Agreement shall continue in full force and effect from year to year with respect
to a Class, provided that such continuance is specifically approved at least
annually:
(a) (i) by the Fund's Board of Directors or (ii) by the vote of
a majority of the outstanding voting securities (as defined in section
2(a)(42) of the 1940 Act) that constitute Class Shares, and
(a) by the affirmative vote of a majority of the Non-Interested
Directors of the Fund by votes cast in person at a meeting specifically called
for the purpose of voting on such approval.
13. Amendment. This Agreement may be amended by the parties hereto
---------
with respect to a Class only if such amendment is specifically approved (i) by
the Board of Directors of the Fund or by the vote of a majority of outstanding
Class Shares, and (ii) by a majority of the Non-Interested Directors of the
Fund, which vote must be cast in person at a meeting called for the purpose of
voting on such approval.
14. Termination. This Agreement may be terminated at any time,
-----------
without the payment of any penalty, by vote of the Fund's Board of Directors, by
a vote of a majority of the members of the Non-Interested Directors of the Fund
or by vote of a majority of outstanding Class Shares (as defined in section
2(a)(42) of the 1940 Act), or by the Distributor, on sixty (60) days' written
notice to the other party. The notice provided for herein may be waived by
either
-9-
<PAGE>
party. This Agreement shall automatically terminate in the event of its
assignment, the term "assignment" for this purpose having the meaning defined in
Section 2(a)(4) of the 1940 Act.
15. Miscellaneous.
-------------
(a) The Distributor agrees on behalf of itself and its employees
to treat confidentially and as proprietary information of the Fund all records
and other information relative to the Fund and its prior, present or potential
shareholders, and not to use such records and information for any purpose other
than performance of its responsibilities and duties hereunder, except after
prior notification to and approval in writing by the Fund, which approval shall
not be unreasonably withheld and may not be withheld where the Distributor may
be exposed to civil or criminal contempt proceedings for failure to comply, when
requested to divulge such information by duly constituted authorities, or when
so requested by the Fund.
(b) Any question of interpretation of any term or provision of
this Agreement having a counterpart in or otherwise derived from a term or
provision of the 1940 Act shall be resolved by reference to such term or
provision of the 1940 Act and to interpretations thereof, if any, by the United
States courts or, in the absence of any controlling decision of any such court,
by rules, regulations or orders of the SEC issued pursuant to the 1940 Act. In
addition, where the effect of a requirement of the 1940 Act reflected in any
provision of this Agreement is revised by rule, regulation or order of the SEC,
such provision shall be deemed to incorporate the effect of such rule,
regulation or order. Otherwise, the provisions of this Agreement shall be
governed by the laws of the State of Maryland.
(c) All notices and other communications hereunder shall be in
writing or by confirming telegram, cable, telex or facsimile sending device.
Notices shall be addressed (a) if to the Distributor, at Provident Distributors,
Inc., Four Falls Corporate Center, 6th Floor, West Conshohocken, Pennsylvania
19428, Attention: Phil Rinnander and (b) if to the Fund, at the address of the
Fund, Attention: Treasurer. If notice is sent by first-class mail, it shall be
deemed to have been given three days after it is sent. If notice is sent by
messenger, it shall be deemed to have been given on the day it is delivered, or
if sent by confirming telegram, cable, telex or facsimile sending device, it
shall be deemed to have been given immediately.
-10-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed in duplicate by their respective officers as of the day and year
first above written.
THE RBB FUND, INC.
BY:/S/ Edward J. Roach
-------------------
PROVIDENT DISTRIBUTORS, INC.
BY:/S/ Philip Rinnander
--------------------
-11-
<PAGE>
Exhibit A
RBB SHARE CLASSES TO WHICH DISTRIBUTION AGREEMENT RELATES
COMPENSATION
(Basis Points)
Class A CLASS A COMMON STOCK --
Class B CLASS B COMMON STOCK --
Class C CLASS C COMMON STOCK --
Class D CLASS D COMMON STOCK --
Class E RBB Money Market --
Class F RBB Municipal Money Market --
Class G Cash Preservation Money Market 65
Class H Cash Preservation Municipal Money Market 65
Class I Sansom Street Municipal Money Market --
Class J Sansom Street Money Market 20
Class K Sansom Street Government Obligations --
Money Market
Class L Bedford Money Market 65
Class M Bedford Municipal Money Market 65
Class N Bedford Government Obligations Money Market 65
Class O Bedford New York Municipal Money Market 65
Class P RBB Government Securities 65
Class Q CLASS Q COMMON STOCK --
Class R Bradford Municipal Money Market --
Class S Bradford Government Obligations Money Market --
Class T --
Class U --
<PAGE>
Class V --
Class W CLASS W COMMON STOCK --
Class X --
Class Y --
Class Z --
Class AA --
Class BB --
Class CC --
Class DD CLASS DD COMMON STOCK --
Class EE CLASS EE COMMON STOCK --
Class FF n/i Micro Cap --
Class GG n/i Growth --
Class HH n/i Growth and Value --
Class II --
Class JJ --
Class KK --
Class LL --
Class MM --
Class NN --
Class OO --
Class PP --
Class QQ Boston Partners Institutional Large Cap Value 15
Class RR Boston Partners Investor Large Cap Value 25
Class SS Boston Partners Advisor Large Cap Value 75
Class TT Boston Partners Investor Mid Cap Value 25
-2-
<PAGE>
Class UU Boston Partners Institutional Mid Cap Value 15
Class VV Boston Partners Institutional Bond 15
Class WW Boston Partners Investor Bond 25
Class XX n/i Larger Cap Value --
Class YY Schneider Capital Management Value Fund --
Class ZZ --
Class AAA --
Class BBB --
Class CCC --
Class DDD Boston Partners Institutional Micro Cap Value --
Class EEE Boston Partners Investor Micro Cap Value 25
Class FFF --
Class GGG --
Class HHH --
Class III Boston Partners Institutional Market Neutral --
Class JJJ Boston Partners Investor Market Neutral 25
Class KKK Boston Partners Institutional Long-Short Equity --
Class LLL Boston Partners Investor Long-Short Equity 25
Class MMM n/i Small Cap Value --
Class JANNEY Janney Montgomery Scott Money Market 65
MONTGOMERY MONEY
Class JANNEY Janney Montgomery Scott Municipal Money Market 65
MONTGOMERY MUNICIPAL
Class JANNEY Janney Montgomery Scott Government Obligations 65
MONTGOMERY GOVERNMENT Money Market
OBLIGATIONS MONEY
Class JANNEY Janney Montgomery Scott Municipal NY Money Market 65
MONTGOMERY N.Y.
MUNICIPAL MONEY
-3-
<PAGE>
Class SELECT 1 Money Market 65
Class BETA 2 Municipal Money Market --
Class BETA 3 Government Obligations Money Market --
Class BETA 4 New York Municipal Money Market --
Class PRINCIPAL 1 Money Market 65
Class GAMMA 2 Municipal Money Market --
Class GAMMA 3 Government Obligations Money Market --
Class GAMMA 4 New York Municipal Money Market --
Class DELTA 1 Money Market --
Class DELTA 2 Municipal Money Market --
Class DELTA 3 Government Obligations Money Market --
Class DELTA 4 New York Municipal Money Market --
Class EPSILON 1 Money Market --
Class EPSILON 2 Municipal Money Market --
Class EPSILON 3 Government Obligations Money Market --
Class EPSILON 4 New York Municipal Money Market --
Class ZETA 1 Money Market --
Class ZETA 2 Municipal Money Market --
Class ZETA 3 Government Obligations Money Market --
Class ZETA 4 New York Municipal Money Market --
Class ETA 1 Money Market --
Class ETA 2 Municipal Money Market --
Class ETA 3 Government Obligations Money Market --
Class ETA 4 New York Municipal Money Market --
Class THETA 1 Money Market --
-4-
<PAGE>
Class THETA 2 Municipal Money Market --
Class THETA 3 Government Obligations Money Market --
Class THETA 4 New York Municipal Money Market --
-5-
<PAGE>
Exhibit B
PROVIDENT DISTRIBUTORS, INC.
Four Falls Corporate Center, 6th Floor
West Conshohocken, Pennsylvania 19428
_______, 1999
[Insert Name of Dealer]
Ladies and Gentlemen:
We serve as distributor of the classes (individually, a "Class" and,
collectively, "Classes" of shares ("Shares") of the investment portfolios of The
RBB Fund, Inc. (the "Fund") listed on Schedule A attached to this Agreement.
The Fund offers Shares to the public in accordance with the terms and conditions
contained in the Prospectuses (and Statements of Additional Information ("SAIs")
incorporated by reference thereto) relating to those Classes of Shares.
In connection with the offering of Shares to the public, you agree to
assist in the distribution of Shares on the following terms and conditions:
1. You are hereby authorized to use your best efforts to offer and
sell the Classes of Shares appearing on Schedule A hereto as such Schedule shall
be amended from time to time consistent with the provisions of this Agreement.
In connection with those activities, you are also hereby authorized to
distribute the promotional and sales materials, Prospectuses, SAIs (upon request
by a purchaser), shareholder reports and other materials relevant to a
particular Class and to perform, if any, the shareholder services which you have
agreed to provide in respect of any such Class. All such activities shall be
performed in compliance with the conditions and procedures set forth in the
relevant Prospectuses and SAIs, including, without limitation, the public
offering price then in effect. If the services you agree to provide pursuant to
this Paragraph 1 are in respect of any _____ Class Shares, you hereby agree to
pay all direct and indirect expenses or costs we may incur under the
Distribution Agreement between us and the Fund arising in connection with any
promotional or sales literature (including Prospectuses and SAIs) furnished to
you in any offering of the _______ Class Shares, as well as expenses of
advertising and all legal expenses in connection with the matters covered by
this sentence.
2. No person is authorized to make any representation concerning
the Fund or the Shares of any Class except those contained in the Prospectuses
and related SAIs and in such printed information as we may subsequently prepare.
No person is authorized to distribute any sales literature or advertisements as
those terms are defined under Section 2210 of the Conduct Rules of the National
Association of Securities Dealers Regulation, Inc. ("NASD") relating to the Fund
without our prior written approval.
<PAGE>
3. Applicable selling commissions, concessions or other fees
(including, without limitation, fees paid to us under a Plan of Distribution
with respect to a Class pursuant to Rule 12b-1 under the 1940 Act and
reallocated to you) to which you are entitled for the provision of the services
to be rendered under this Agreement are those specified on attached Schedule A
to this Agreement and in the current Prospectus of the Fund, as such Schedule
and Prospectuses shall be amended from time to time. These amounts are subject
to change without notice by us and comply with any changes in regulatory
requirements.
4. You agree that in performing the services under this Agreement,
you at all times will comply with the Conduct Rules of the NASD, including,
without limitation, the provisions of Section 2830 of such Rules. You agree that
you will not combine customer orders to reach breakpoints in commissions for any
purposes whatsoever unless authorized by the then current Prospectus in respect
of Shares of a particular Class or by us in writing. You also agree that you
will place orders immediately upon their receipt and will not withhold any order
so as to profit therefrom. In determining the amount payable to you hereunder,
we reserve the right to exclude any sales which we reasonably determine are not
made in accordance with the terms of the relevant Prospectus and provisions of
this Agreement.
5. You agree to comply with the provisions contained in the
Securities Act of 1933 governing the distribution of Prospectuses to persons to
whom you offer Shares under this Agreement. You further agree to deliver, upon
our request, copies of any amended Prospectus to purchasers, if any, whose
Shares you are holding as record owner and to deliver to such customers copies
of the annual and interim reports and proxy solicitation materials of the Fund.
We agree to furnish to you as many copies of the Prospectuses and related SAIs,
annual and interim financial reports and proxy solicitation materials as you may
reasonably request.
6. You represent that you are a properly registered or licensed
broker or dealer under applicable federal and state law and a member in good
standing of the NASD). Your expulsion or suspension from the NASD will
automatically terminate this Agreement on the effective date of such expulsion
or suspension.
7. For all purposes of this Agreement you will be deemed to be an
independent contractor and will have no authority to act as agent for us or the
Fund in any manner or in any respect. You agree to and do release, indemnify and
hold us, the Fund and its transfer agent and our and their respective officers,
directors, agents, employees and affiliates harmless from and against any and
all direct or indirect liabilities, losses, claims, demands and expenses
(including, without limitation, reasonable attorneys' fees) resulting from
requests directions, actions, or inactions of or by you or your officers,
employees, or agents regarding your responsibilities under this Agreement or the
purchase, redemption, transfer or registration of Shares by or on behalf of
customers. This indemnification shall survive the termination of this Agreement.
8. You shall not make offers or sales of Shares in any state or
jurisdiction where the particular Shares are not qualified for sale under or
exempt from the requirements of the securities laws of the state or other
jurisdictions where the proposed offer or sale is to be
-2-
<PAGE>
made. You also agree that you will not offer or sell any Shares to persons in
any jurisdiction in which you are not properly licensed and authorized to make
such offers or sales.
9. The Fund shall have full authority to take such action as it
deems advisable in respect of all matters pertaining to the offering of the
Shares, including the right, in its discretion, to reject an order for Shares
and, without notice, to suspend sales or withdraw the offering of Shares of any
and all Classes entirely.
10. You will (i) maintain all records required by law (including
records detailing the services you provide in return for the fees to which you
are entitled under this Agreement) and, upon request by the Fund or us, promptly
make such of these records available to the Fund or us, as the case may be, as
the Fund or we may reasonably request in connection with its operations; and
(ii) promptly notice the Fund and us if you experience any difficulty in
maintaining the records described in the foregoing clauses in an accurate and
complete manner.
11. We and the Fund shall be under no liability to you except for
lack of good faith and for obligations expressly assumed by us hereunder. In
carrying out your obligations, you agree to act in good faith and without
negligence. Nothing contained in this Agreement is intended to operate as a
waiver by us or you of compliance with any provision of the NASD Conduct Rules,
or any federal or state securities laws or the rules and regulations adopted
thereunder.
12. This Agreement shall become effective only when accepted and
signed by you and may be amended only by a written instrument signed by you and
us. This Agreement may be terminated as provided above and by either party,
without penalty, upon notice to the other party.
13. All communications to us should be sent to:
Provident Distributors, Inc.
Four Falls Corporate Center, 6th Floor
West Conshohocken, Pennsylvania 19428
Any notice to you shall be duly given if mailed or telegraphed to you at the
address specified by you below.
14. You hereby represent and warrant that you are duly authorized by
all necessary action, approval or authorization to enter into this Agreement and
that, if a corporation, partnership or other entity, you are duly organized,
validly existing and in good standing under the laws of the jurisdiction in
which you are organized.
15. This Agreement constitutes the entire agreement between the
parties hereto relating to the subject matter hereof and supersedes any and all
agreements between the
-3-
<PAGE>
parties relating to said subject matter. This Agreement and all the rights and
obligations of the parties hereunder shall be governed by and construed under
the laws of the State of New York.
PROVIDENT DISTRIBUTORS, INC.
Date:_______________ By:_______________________________
-4-
<PAGE>
Accepted and Agreed to:
Name of Broker Dealer____________________________________________
Address__________________________________________________________
City__________________________ State____________ Zip___________
Telephone Number_________________________________________________
Name of Authorized Officer___________________ Title_____________
Date:_______________ Authorized Officer Signature_______________
-5-
<PAGE>
Schedule A to Broker/Dealer Agreement
You will assist in the distribution of the Classes of Shares of Common
Stock, par value $.001 of The RBB Fund, Inc. and, in addition to other fees to
which you may be entitled, shall receive fees at an annual rate set forth below
in respect of the following Shares payable pursuant to Rule 12b-1 under the
Investment Company Act of 1940.*
__________________________
* Rule 12b-1 fees will be paid quarterly within one month following the end of
each calendar quarter after you supply services to your customers who
purchase Shares. These fees are based on the average daily net asset value
of the Shares during the period covered by the payment. You will not
receive payment of any fees for any quarterly period if you are entitled to
less than $1,000. To the extent that we are required to waive any portion
of the Rule 12b-1 fees payable to us by The RBB Fund, Inc., you shall waive
a proportionate share of the Rule 12b-1 fees payable to you hereunder.
A-1
<PAGE>
DISTRIBUTION AGREEMENT SUPPLEMENT
(Bogle Investment Management Small Cap Growth Fund -
Classes NNN and OOO)
This supplemental agreement is entered into this 15th day of September,
1999, by and between THE RBB FUND, INC. (the "Fund") and PROVIDENT
DISTRIBUTORS,INC. (the "Distributor").
The Fund is a corporation organized under the laws of the State of Maryland
and is an open-end management investment company. The Fund and the Distributor
have entered into a Distribution Agreement, dated as of June 25, 1999 (as from
time to time amended and supplemented, the "Distribution Agreement"), pursuant
to which the Distributor has undertaken to act as distributor for the Fund, as
more fully set forth therein. Certain capitalized terms used without
definition in this Distribution Agreement Supplement have the meaning specified
in the Distribution Agreement.
The Fund agrees with the Distributor as follows:
1. Adoption of Distribution Agreement. The Distribution Agreement is
----------------------------------
hereby adopted for the Bogle Investment Management Small Cap Growth Fund (Class
NNN and Class OOO) of the Fund. Each of these classes shall constitute a "Class"
as referred to in the Distribution Agreement and each of its shares shall be
"Class Shares" as referred to therein.
2. Payment of Fees. For all services to be rendered, facilities furnished
---------------
and expenses paid or assumed by the Distributor as provided in the Distribution
Agreement and herein, the Fund shall pay the Distributor no compensation.
3. Counterparts. This agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned have entered into this Agreement,
intending to be legally bound hereby, as of the date and year first above
written.
THE RBB FUND, INC. PROVIDENT DISTRIBUTORS, INC.
By: /s/ Edward J. Roach By: /s/ Phil Rinnander
------------------------- ------------------
Edward J. Roach Phil Rinnander
President and Treasurer Title: Chief Executive Officer
<PAGE>
CUSTODIAN AGREEMENT SUPPLEMENT
(Bogle Investment Management Small Cap Growth Fund)
This supplemental agreement is entered into this 15th day of September,
1999 by and between THE RBB FUND, INC. (the "Company") and PFPC Trust Company,
(the "Custodian Agent").
The Company is a corporation organized under the laws of the State of
Maryland and is an open-end management investment company. The Company and the
Custodian have entered into a Custodian Agreement, dated as of August 16, 1988
(as from time to time amended and supplemented, the "Custodian Agreement"),
pursuant to which the Custodian has undertaken to act as custodian for the
Company with respect to the portfolios of the Fund, as more fully set forth
therein. Certain capitalized terms used without definition in this Custodian
Agreement Supplement have the meaning specified in the Custodian Agreement.
The Fund agrees with the Custodian as follows:
1. Adoption of Custodian Agreement. The Custodian Agreement is hereby
-------------------------------
adopted for the Bogle Investment Management Small Cap Growth Fund.
2. Compensation. As compensation for the services rendered by the
------------
Custodian during the term of the Custodian Agreement, the Fund will pay to the
Custodian, with respect to the Bogle Investment Management Small Cap Growth
Fund, monthly fees as shall be agreed to from time to time by the Fund and the
Custodian.
3. Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned have entered into this Agreement,
intending to be legally bound hereby, as of the date and year first above
written.
THE RBB FUND, INC. PFPC TRUST COMPANY
By: /s/ Edward J. Roach By: /s/ Joseph Gramlich
-------------------- ---------------------
Edward J. Roach Joseph Gramlich
<PAGE>
TRANSFER AGENCY AGREEMENT SUPPLEMENT
(Bogle Investment Management Small Cap Growth Fund)
(Institutional and Investor Classes)
This supplemental agreement is entered into this 15th day of September,
1999 by and between THE RBB FUND, INC. (the "Company") and PFPC, Inc., a
Delaware corporation (the "Transfer Agent"), which is an indirect, wholly-owned
subsidiary of PFPC Worldwide, Inc.
The Company is a corporation organized under the laws of the State of
Maryland and is an open-end management investment company. The Company and the
Transfer Agent have entered into a Transfer Agency Agreement, dated as of
November 5, 1991 (as from time to time amended and supplemented, the "Transfer
Agency Agreement"), pursuant to which the Transfer Agent has undertaken to act
as transfer agent, registrar and dividend disbursing agent for the Company with
respect to the Shares of the Company, as more fully set forth therein. Certain
capitalized terms used without definition in this Transfer Agency Agreement
Supplement have the meaning specified in the Transfer Agency Agreement.
The Fund agrees with the Transfer Agent as follows:
1. Adoption of Transfer Agency Agreement. The Transfer Agency Agreement
-------------------------------------
is hereby adopted for the Bogle Investment Management Small Cap Growth Fund (the
"Fund") Institutional Class of Common Stock (Class NNN) and Investor Class of
Common Stock (Class OOO)of the Fund.
2. Compensation. As compensation for the services rendered by the
------------
Transfer Agent during the term of the Transfer Agency Agreement, the Fund will
pay to the Transfer Agent, with respect to each Class of the Fund, monthly fees
that shall be agreed to from time to time by the Company and the Transfer Agent,
for each account open at any time during the month for which payment is being
made, plus certain of the Transfer Agent's expenses relating to such services.
3. Counterparts. This Agreement may be executed in two or more counterparts,
------------
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned have entered into this Agreement,
intending to be legally bound hereby, as of the date and year first above
written.
THE RBB FUND, INC. PFPC, INC.
By: /s/ Edward J. Roach By: /s/ Steve Turowski
-------------------- -------------------
Edward J. Roach Steve Turowski
President & Treasurer
<PAGE>
ADMINISTRATIVE SERVICES AGREEMENT
---------------------------------
This Agreement is made as of the 15th day of September, 1999, by and
between THE RBB FUND, INC., a Maryland corporation (the "Fund"), on behalf of
its Bogle Investment Management Small Cap Growth Fund (the "Portfolio") and
PROVIDENT DISTRIBUTORS, INC. ("Provident"), a Delaware corporation.
W I T N E S S E T H
WHEREAS, the Fund is registered as an open-end, diversified management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Fund wishes to retain Provident to provide certain
administrative services to the Portfolio, and Provident is willing to furnish
such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Fund hereby appoints Provident to provide certain
-----------
administrative services to the Portfolio for the period and on the terms set
forth in this Agreement. Provident accepts such appointment and agrees to
furnish the services herein set forth in return for the compensation as provided
in Paragraph 6 of this Agreement. Provident agrees to comply with all relevant
provisions of the Securities Act of 1933, as amended, the Securities Exchange
Act of 1934, as amended, and 1940 Act and applicable rules and regulations
thereunder.
<PAGE>
2. Services on a Continuing Basis. Subject to the supervision and
------------------------------
direction of the Board of Directors of the Fund, Provident undertakes to perform
the following administrative services for the Portfolio:
(a) Making available office facilities, as requested by the Fund,
(which may be in the offices of Provident or a corporate affiliate);
(b) Furnishing data processing services, clerical services and certain
internal quasi-legal, executive and administrative services;
(c) Furnish an 800 telephone line for shareholder inquiries and
otherwise assist in the preparation of shareholder communications and notices as
requested by the Fund or the investment adviser to the Portfolio (the
"Investment Adviser").
(d) Assisting in coordinating the preparation of reports to the
Portfolio's shareholders of record and the Securities and Exchange Commission
(the "SEC") including, but not limited to, proxy statements; annual, semi-annual
and quarterly reports to Shareholders; annual and semi-annual reports on Form N-
SAR; and post-effective amendments to the Fund's Registration Statement on Form
N-1A (the "Registration Statement");
(e) Assisting the Investment Adviser, at the Investment Adviser's
request, in monitoring and developing compliance procedures which will include,
among other matters, procedures to assist the Investment Adviser in monitoring
compliance with the Portfolio's investment objective, policies, restrictions,
tax matters and applicable laws and regulations;
<PAGE>
and
(f) Acting as liaison between the Fund and the Fund's independent
public accountants, counsel, custodian or custodians, transfer agent and
administrator and taking all reasonable action in the performance of its
obligations under this Agreement to assure that all necessary information is
made available to each of them.
In performing all services under this Agreement, Provident shall act in
conformity with applicable law, the Fund's Articles of Incorporation and By-
Laws, and all amendments thereto, and the Portfolio's investment objective,
investment policies and other practices and policies set forth in the Fund's
Registration Statement, as such Registration Statement and practices and
policies may be amended from time to time.
3. Books and Records. In connection with the services provided under this
-----------------
Agreement, Provident shall maintain such books and records, as required by the
Fund, of the Fund's reports or filings with the Portfolio's shareholders, the
SEC authorities and other required reports and documents prepared, filed or
distributed on behalf of the Fund.
The books and records pertaining to the Fund or any Portfolio that are in
the possession of Provident shall be the property of the Fund. Such books and
records shall be prepared and maintained as required by the 1940 Act and other
applicable securities laws and rules and regulations. The Fund, or the Fund's
authorized representatives, shall have access to such books and records at all
times during Provident's normal business
<PAGE>
hours. Upon the reasonable request of the Fund, copies of any such books and
records shall be provided by Provident to the Fund or the Fund's authorized
representative at the Fund's expense.
4. Confidentiality. Provident agrees on behalf of itself and its
---------------
employees to treat confidentially all records and other information relative to
the Fund or any Portfolio and its prior, present or potential shareholders and
relative to the Investment Adviser and its prior, present or potential
customers, except, after prior notification to and approval in writing by the
Fund, which approval shall not be unreasonably withheld and may not be withheld
where Provident may be exposed to civil or criminal contempt proceedings for
failure to comply, when requested to divulge such information by duly
constituted authorities, or when so requested by the Fund.
5. Right to Receive Advice.
-----------------------
(a) Advice of Fund. If Provident is in doubt as to any action to be
--------------
taken or omitted by it, it may request, and shall receive, directions or advice
from the Fund.
(b) Advice of Counsel. If Provident is in doubt as to any question of
-----------------
law involved in any action to be taken or omitted by Provident, it may request
advice at its own cost from counsel of its own choosing (who may be counsel for
the Investment Adviser, the Fund or Provident, at the option of Provident).
(c) Conflicting Advice. In case of conflict between directions or
------------------
advice received by Provident pursuant to subsection (a) of this paragraph and
advice received by Provident pursuant
<PAGE>
to subsection (b) of this paragraph, Provident shall be entitled to rely on and
follow the advice received pursuant to the latter provision alone.
(d) Protection of Provident. Provident shall be protected in any
-----------------------
action or inaction which it takes in reliance on any directions or advice
received pursuant to subsections (a) or (b) of this paragraph which Provident,
after receipt of any such directions or advice in good faith believes to be
consistent with such directions or advice. However, nothing in this paragraph
shall be construed as imposing upon Provident any obligation (i) to seek such
directions or advice or (ii) to act in accordance with such directions or advice
when received. Nothing in this subsection shall excuse Provident when an action
or omission on the part of Provident constitutes willful misfeasance, bad faith,
negligence or reckless disregard by Provident of its duties under this
Agreement.
6. Compensation. In consideration of services rendered pursuant to this
------------
Agreement, the Fund will pay Provident on the first business day of each month a
fee for the previous month, calculated daily. The Fund will also reimburse
Provident for its out-of-pocket expenses incurred on behalf of the Fund,
including but not limited to, postage, telephone, telex and Federal Express
charges. The annual fee shall be .15% of the Portfolio's average daily net
assets exclusive of out-of-pocket expenses. Upon any termination of this
Agreement before the end of any month, the fee for such part of a month shall be
prorated according to the proportion which such period bears to the full monthly
period and
<PAGE>
shall be payable upon the date of termination of this Agreement. For the purpose
of determining fees payable to Provident, the value of the Portfolio's net
assets shall be computed at the times and in the manner specified in the Fund's
Prospectus and Statement of Additional Information as from time to time in
effect. The annual fee paid to Provident hereunder may be amended upon terms as
may be specifically agreed to in writing from time to time by the Fund and
Provident.
7. Indemnification. The Fund agrees to indemnify and hold harmless
---------------
Provident and its nominees from all taxes, charges, expenses, assessments,
claims and liabilities (including, without limitation, liabilities arising under
federal securities and commodities laws and any state and foreign securities and
Blue Sky laws, all as or to be amended from time to time) and expenses,
including (without limitation) attorneys' fees and disbursements, arising
directly or indirectly from any action or thing which Provident takes or does or
omits to take or do pursuant to the terms of this Agreement or otherwise at the
request or on the direction of or in reliance on the advice of the Fund,
provided, that neither Provident nor any of its nominees shall be indemnified
against any liability to the Fund or to its Shareholders (or any expenses
incident to such liability) arising out of Provident's own willful misfeasance,
bad faith, negligence or reckless disregard of its duties and obligations under
this Agreement.
8. Responsibility of Provident. Provident shall be under no duty to take
---------------------------
any action on behalf of the Fund, except as
<PAGE>
specifically set forth herein or as may be specifically agreed to by Provident
in writing. In the performance of its duties hereunder, Provident shall be
obligated to exercise care and diligence and to act in good faith and to use its
best efforts within reasonable limits in performing services provided for under
this Agreement.
Provident shall be responsible for its own negligent failure to perform its
duties under this Agreement. Without limiting the generality of the foregoing
or of any other provision of this Agreement, Provident in connection with its
duties under this Agreement shall not be under any duty or obligation to inquire
into and shall not be liable for or in respect of (a) the validity or invalidity
or authority or lack thereof of any notice or other instrument which conforms to
the applicable requirements of this Agreement, and which Provident reasonably
believes to be genuine; or (b) delays or errors or loss of data occurring by
reason of circumstances beyond Provident's control, including acts of civil or
military authority, national emergencies, labor difficulties, fire, mechanical
breakdown, flood or catastrophe, acts of God, insurrection, war, riots or
failure of the mails, transportation, communication or power supply.
9. Duration and Termination. This Agreement shall continue until
------------------------
terminated by the Fund or Provident on 60 days' written notice.
10. Notices. All notices and other communications hereunder (collectively
-------
referred to as "Notice" or "Notices" in this Paragraph), shall be in writing or
by confirming telegram,
<PAGE>
Cable, telex or facsimile sending device. Notices shall be addressed (a) if to
Provident at Provident's address, Four Falls Corporate Center, 6/th/ Floor, West
Conshohocken, PA 19428; (b) if to the Fund, at 400 Bellevue Parkway, Wilmington,
DE 19809; or (c) if to neither of the foregoing, at such other address as shall
have been notified to the sender of any such Notice or other communication. If
the location of the sender of a Notice or other communication and the address of
the addressee thereof are, at the time of sending more than 100 miles apart, the
Notice may be mailed, in which case it shall be deemed to have been given three
days after it is sent, or if sent by confirming telegram, cable, telex, or
facsimile sending device charges arising from the sending of a Notice hereunder
shall be paid by the sender.
11. Further Actions. Each party agrees to perform such further acts and
---------------
execute such further documents as are necessary to effectuate the purposes
hereof.
12. Amendments. This Agreement or any part hereof may be changed or waived
----------
only by an instrument in writing signed by the party against which enforcement
of such change or waiver is sought.
13. Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
14. Miscellaneous. This Agreement embodies the entire agreement and
-------------
understanding between the parties thereto, and supersedes all prior agreements
and understandings, relating to
<PAGE>
the subject matter hereof. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. This
Agreement shall be deemed to be a contract made in New York and governed by New
York law. If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby. This Agreement shall be binding and shall inure
to the benefit of the parties hereto and their respective successors.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below as of the day and year first above
written.
THE RBB FUND, INC.
By: /s/ Edward J. Roach
-------------------
Edward J. Roach
Title: President and Treasurer
PROVIDENT DISTRIBUTORS, INC.
By: /s/ Phil Rinnander
-------------------
Phil Rinnander
<PAGE>
NON-12b-1 SHAREHOLDER SERVICES PLAN
OF
THE RBB FUND, INC.
Section 1. Upon the recommendation of the Fund's distributor
---------
("Distributor") of shares of Class OOO Common Stock of The RBB Fund, Inc., par
value $.001 per share (the "Class OOO Share"), any officer of The RBB Fund, Inc.
(the "Fund") is authorized to execute and deliver, in the name and on behalf of
the Fund, written agreements, in substantially the form attached hereto or in
any other form duly approved by the Fund's Board of Directors ("Servicing
Agreements"), with shareholders of record, ("Service Organizations") of the
Fund's Class OOO Shares. Such Servicing Agreements shall require the Service
Organizations to provide certain support services on behalf of the Fund as set
forth therein to their clients who beneficially own Class OOO Shares in
consideration of a fee, computed daily and paid monthly in the manner set forth
in the Servicing Agreements, at the annual rate not to exceed .25% of the
average daily net asset value of Class OOO Shares held by the Service
Organizations on behalf of their clients. All expenses incurred by the Fund in
connection with the Servicing Agreements and the implementation of this Non-12b-
1 Shareholder Services Plan ("Plan") shall be borne entirely by the holders of
Class OOO Shares.
Section 2. The Distributor shall monitor the arrangements pertaining to
---------
the Fund's Servicing Agreements with Service Organizations in accordance with
the terms of the Distributor's distribution agreement with the Fund pertaining
to Class OOO Shares. The Distributor shall not, however, be obligated by this
Plan to recommend, and the Fund shall not be obligated to execute, any Servicing
Agreement with any Service Organization.
Section 3. So long as this Plan is in effect, the Distributor shall
---------
provide to the Fund's Board of Directors, and the Directors shall review, at
least quarterly, a written report of the amounts expended pursuant to this Plan
and the purposes for which such expenditures were made.
Section 4. This Plan shall become effective as of September 15, 1999 upon
---------
the approval of the Plan (and the form of Servicing Agreement attached hereto)
by a majority of the Fund's Directors who are not "interested persons" as
defined in the Investment Company Act of 1940 (the "Act") of the Fund and have
no direct or indirect financial interest in the operation of this Plan or in any
Servicing Agreements or other agreements related to this Plan (the
"Disinterested Directors"), pursuant to a vote cast in person at a meeting
called for the purpose of voting on
<PAGE>
the approval of this Plan (and form of Servicing Agreement.)
Section 5. Unless sooner terminated, this Plan shall continue until August
---------
16, 2000, and thereafter shall continue automatically for successive annual
periods ending on August 16, provided such continuance is approved at least
annually in the manner set forth in Section 4.
Section 6. This Plan may be amended at any time by the Fund's Board of
---------
Directors, provided that any material amendments of the terms of this Plan shall
become effective only upon the approvals set forth in Section 4.
Section 7. This Plan is terminable at any time by vote of a majority of
---------
the Disinterested Directors.
Section 8. While this Plan is in effect, the selection and nomination of
---------
those Directors who are not "interested persons" (as defined in the Act) of the
Fund shall be committed to the discretion of such Directors who are not
"interested persons" (as defined in the Act) of the Fund.
Section 9. The Fund has adopted this Non-12b-1 Shareholder Services Plan
---------
as of July 28, 1999.
-2-
<PAGE>
THE RBB FUND, INC.
400 Bellevue Parkway
Wilmington, Delaware 19809
SHAREHOLDER SERVICING AGREEMENT
Gentlemen:
We wish to enter into this Shareholder Servicing Agreement with you
concerning the provision of support services to your clients ("Clients") who may
from time to time beneficially own shares of Class OOO Common Stock, par value
$.001 per share ("Class OOO Shares").
The terms and conditions of this Servicing Agreement are as follows:
Section 1. You agree to provide any or all of the following support
services to Clients who may from time to time beneficially own Class OOO Shares:
(i) aggregating and processing purchase and redemption request for Class OOO
Shares from Clients and placing net purchase and redemption orders with our
transfer agent, PFPC Inc.; (ii) providing Clients with a service that invests
the assets of their account in Class OOO Shares pursuant to specific or pre-
authorizing instructions; (iii) processing dividend payments from us on behalf
of Clients; (iv) providing information periodically to Clients showing their
positions in Class OOO Shares; (v) arranging for bank wires; (vi) responding to
Client inquiries relating to the services performed by you; (vii) providing
subaccounting with respect to Class OOO Shares beneficially owned by Clients or
the information to us necessary for subaccounting; (viii) if required by law,
forwarding shareholder communications from us (such as proxies, shareholder
reports, annual and semi-annual financial statements and dividend, distribution
and tax notices) to Clients' and (ix) providing such other similar services as
we may reasonably request to the extent you are permitted to do so under
applicable statutes, rules or regulations.
Section 2. You represent that: (a) you will provide to your Clients a
schedule of any fees charged by you to your Clients in connection with the
investment of their assets in Class OOO Shares; (b) you will retain payments
received by you hereunder only if an investment in Class OOO Shares has been
authorized by your Clients; and (c) the compensation paid to you hereunder will
not be excessive or unreasonable.
Section 3. You will provide such office space and equipment, telephone
facilities and personnel (which may be any part of the space, equipment and
facilities currently used in your business, or any personnel employed by you) as
may be reasonably necessary or beneficial in order to provide the aforementioned
services to Clients.
<PAGE>
Section 4. Neither you nor any of your officers, employees or agents
are authorized to make any representations concerning us or Class OOO Shares
except those contained in our then current prospectus for such Class OOO Shares,
copies of which will be supplied by us, or caused to be supplied by our
distributor, to you, or in such supplemental literature or advertising as may be
authorized by us in writing.
Section 5. For all purposes of this Agreement you will be deemed to be
an independent contractor, and will have no authority to act as agent for us or
PDI in any matter or in any respect. By your written acceptance of this
Agreement, you agree to and do release, indemnify and hold us harmless from and
against any and all direct or indirect liabilities or losses resulting from
requests, directions, actions or inactions of or by you or your officers,
employees or agents regarding your responsibilities hereunder or the purchase,
redemption, transfer or registration of Class OOO Shares by or on behalf of
Clients. You and your employees will, upon request, be available during normal
business hours to consult with us or our designees concerning the performance of
your responsibilities under this Agreement.
Section 6. In consideration of the services and facilities provided by
you hereunder, we will pay to you, and you will accept as fully payment
therefor, a fee at the annual rate of .25% of the average daily net asset value
of the Class OOO Shares held of record by you from time to time on behalf of
Clients (the "Clients' Class OOO Shares"), which fee will be computed daily and
payable monthly. For purposes of determining the fees payable under this Section
6, the average daily net asset value of the Clients' Class OOO Shares will be
computed in the manner specified in your registration statement (as the same is
in effect from time to time) in connection with the computation of the net asset
value of Class OOO Shares for purposes of purchases and redemptions. The fee
rate stated above may be prospectively increased or decreased by us, at our sole
discretion, at any time upon notice to you. We may, in our discretion and
without notice, suspend or withdraw the sale of Class OOO Shares, including the
sale of such shares to you for the account of any Client or Clients.
Section 7. Any person authorized to direct the disposition of monies
paid or payable by us pursuant to this Agreement will provide to our Board of
Directors, and our Directors will review, at least quarterly, a written report
of the amounts so expended and the purposes for which such expenditures were
made. In addition, you will furnish us or our designees with such information as
we or they may reasonably request (including, without limitation, periodic
certifications confirming the provision to Clients of the services described
herein), and will otherwise cooperate with us and our designees (including,
without limitation, any auditors designated by us),
-2-
<PAGE>
in connection with the preparation of reports to our Board of Directors
concerning this Agreement and the monies paid or payable by us pursuant hereto,
as well as any other reports or filings that may be required by law.
Section 8. We may enter into other similar Shareholder Servicing
Agreements with any other person or persons without your consent.
Section 9. By your written acceptance of this Agreement, you
represent, warrant and agree that in no event will any of the services provided
by you hereunder by primarily intended to result in the sale of any shares
issued by us.
Section 10. This Agreement will become effective on the date a fully
executed copy of this Agreement is received by us or our designee. Unless sooner
terminated, this Agreement will continue until August 16, 2000 and thereafter
will continue automatically for successive annual periods ending on August 16,
provided such continuance is specifically approved at least annually by us in
the manner described in Section 13 hereof. This Agreement is terminable, without
penalty, at any time by us (which termination may be by vote of a majority of
our Disinterested Directors as defined in Section 13 hereof) or by you upon
notice to the other party herein.
Section 11. All notices and other communications to either you or us
will be duly given if mailed, telegraphed, telexed or transmitted by similar
telecommunications device to the appropriate address shown herein.
Section 12. This Agreement will be construed in accordance with the
laws of the State of Maryland and is non-assignable by the parties hereto.
Section 13. The form of this Agreement has been approved by vote of a
majority of (i) our Board of Directors and (ii) those Directors who are not
"interested persons" (as defined in the Investment Company Act of 1940) of us
and have no direct or indirect financial interest in the operation of the
Shareholder Services Plan adopted by us regarding the provision of support
services to the beneficial owners of Class OOO Shares or in any agreements
related thereto ("Disinterested Directors"), cast in person at a meeting called
for the purpose of voting on such approval.
-3-
<PAGE>
If you agree to be legally bound by the provisions of this Agreement,
please sign a copy of this letter where indicated below and promptly return it
to us, c/o Provident Distributors, Inc., Four Falls Corporate Center, 6th Floor,
West Conshohocken, Pennsylvania 19428.
Very truly yours,
THE RBB FUND, INC.
Date: By: _____________________
Edward J. Roach
Authorized Officer
Accepted and Agreed to:
_____________________________________
Name of Entity (Please Print or Type)
Address:______________________________
______________________________
______________________________
Date: By: __________________________________
Authorized Officer
-4-
<PAGE>
E*TRADE Group, Inc.
No Transaction Fee Mutual Fund Offering
RETAIL SHAREHOLDER SERVICES AGREEMENT
This Agreement is made as of _______, 19__, among E*TRADE Group, Inc.
("E*TRADE"), a Delaware corporation, The RBB Fund, Inc. on behalf of its
portfolios advised by Boston Partners Asset Management, L.P. ("Fund"), a
Maryland corporation registered under the Investment Company Act of 1940, as
amended (the "1940 Act") as an open-end management investment company, and
Provident Distributors, Inc., a Delaware corporation registered as a broker-
dealer under the Securities Exchange Act of 1934, as amended (the "1934 Act"),
and which serves as principal underwriter to Fund pursuant to an agreement dated
June 25, 1999 and Boston Partners Asset Management, L.P., a Delaware limited
partnership (together with Provident Distributors, Inc., "Fund Affiliates")
(Fund and Fund Affiliates are collectively referred to as "Fund Parties").
WHEREAS, Fund Parties wish to engage E*TRADE to perform certain
record-keeping, shareholder communication, and other shareholder administrative
services for Fund's shareholders; and
WHEREAS, E*TRADE agrees to perform such services on the terms and
conditions set forth in this Agreement;
Now, therefore, in consideration of the foregoing and the mutual
promises set forth below, E*TRADE and Fund Parties agree, intending to be
legally bound hereby, as follows:
1 SERVICES
E*TRADE shall perform such services for Fund Parties as are designated
in Schedule A to this Agreement ("Services"), as such Schedule A may from time
to time be amended, such amendments to be evidenced by the signature thereto by
a duly authorized representative of each of the Parties.
2 COMPENSATION
In consideration for the Services rendered by E*TRADE pursuant to this
Agreement, the Fund Parties shall pay a fee to E*TRADE as shall be calculated
pursuant to Schedule B to this Agreement. Both Fund and Fund Affiliate shall be
severally liable for such compensation in the proportions designated on Schedule
D.
<PAGE>
3 TRANSACTION CHARGES
E*TRADE shall not assess against any of its customers any fee for
executing any purchase or sale order where such order involves the securities of
Fund. Notwithstanding this provision, E*TRADE shall have the right to assess
against customers a fee for executing a purchase or sale order where the
customer has held such position for less than ninety (90) days, or where E*TRADE
provides the customer with a service that is not contemplated by this Agreement.
4 INDEMNIFICATION
(a) Fund Parties agree to indemnify, defend and hold E*TRADE, its
officers, directors, employees, agents, and affiliates free and harmless from
and against (i) any and all claims, demands, liabilities and expenses, including
legal expenses, which E*TRADE, its officers, directors, employees, agents, and
affiliates may incur arising out of or based upon any untrue statement, or
alleged untrue statement, of material fact contained in any registration
statement, prospectus, statement of additional information, sales material, or
other information provided by Fund, or based upon any omission, or alleged
omission, to state a material fact required to be stated to make the statements
contained therein not misleading, except to the extent that E*TRADE has itself
produced such materials; (ii) any breach by either Fund or Fund Affiliate of any
representation, warranty or provision contained herein, or (iii) any willful
misconduct or gross negligence by Fund or Fund Affiliate in the performance of,
or failure to perform, its respective obligations under this Agreement, except
to the extent that such claims, liabilities or expenses are caused by E*TRADE's
breach of this Agreement or willful misconduct or gross negligence in the
performance, or failure to perform, their respective obligations under this
Agreement. This section 4(a) shall survive termination of this Agreement.
(b) E*TRADE agrees to indemnify, defend and hold harmless Fund Parties,
their officers, directors, employees, agents, and affiliates free and harmless
from and against any and all claims, demands, liabilities and expenses,
including legal expenses, which Fund Parties, their officers, directors,
employees, agents, and affiliates may incur arising out of or based upon (i) any
untrue statement, or alleged untrue statement, of material fact contained in any
advertising or sales literature prepared by E*TRADE without reliance upon
information provided by either Fund Parties or an unaffiliated mutual fund
rating or statistical information agency; (ii) any breach by E*TRADE of any
representation, warranty or provision contained herein, or (iii) any willful
misconduct or gross negligence by E*TRADE in the performance of, or failure to
perform, its obligations under this Agreement, except to the extent that such
claims, liabilities or expenses are caused by Fund Parties' breach of this
Agreement or willful misconduct or gross negligence in the performance, or
failure to perform, their respective obligations under this Agreement. This
section 4(b) shall survive termination of this Agreement.
No party hereto shall be liable for any special, consequential or incidental
damages.
-2-
<PAGE>
5 ROLE OF E*TRADE
The parties acknowledge and agree that the Services performed by
E*TRADE pursuant to this Agreement are not the services of an underwriter or
principal underwriter of Fund within the meaning of the 1940 Act or the
Securities Act of 1933, as amended. This Agreement does not grant E*TRADE any
right to purchase shares from Fund; neither does it preclude E*TRADE's ability
to purchase shares from Fund. E*TRADE shall not be deemed to be an agent of Fund
Parties or of Fund for the purposes of selling Fund's shares to any dealer or
the public. To the extent that E*TRADE is involved in the purchase of shares of
any Fund by E*TRADE's customers, such involvement will be as agent of such
customer only.
6 INFORMATION TO BE PROVIDED
Fund parties shall provide to E*TRADE prior to the effectiveness of
this Agreement or as soon thereafter as is reasonably practicable:
(a) Certified resolutions of the board of directors or board of trustees,
as applicable, of Fund Parties authorizing the execution of this Agreement and
the performance by the Fund Party pursuant to this Agreement; and
(b) Two (2) written copies of each current prospectus and statement of
additional information relating to any of Fund's shares which may be purchased
by customers of E*TRADE. Fund Parties agree to submit to E*TRADE two (2) written
copies of any amendment or supplement to or any updated version of such
prospectus(es) and statement(s) of additional information no later than the
effective date of such amendment, supplement or updated version.
7 TERMINATION OF AGREEMENT
This Agreement is terminable, without penalty, at any time upon ninety
(90) days' notice by E*TRADE to Fund and Fund Affiliate or by Fund and Fund
Affiliate to E*TRADE. Termination of this Agreement shall terminate E*TRADE's
obligations to perform the Services, as of the effective date of the
termination, and shall terminate Fund Parties' obligations to pay any
compensation hereunder, as of the effective date of the termination.
Notwithstanding any provision herein to the contrary, Fund Parties' obligations
pursuant to this Agreement shall not be terminated with respect to any
transactions in Fund's shares commenced prior to the effective date of the
termination of this Agreement.
-3-
<PAGE>
8 NOTICES
All notices and other communications will be duly given if mailed,
telegraphed, telexed, or transmitted by similar telecommunications device to the
addresses designated on Schedule C hereto.
9 NON-EXCLUSIVITY
Each Party to this Agreement may enter into agreements similar to this
Agreement with other parties for the performance of services similar to those to
be provided under this Agreement, unless otherwise agreed to in writing by the
Parties.
10 JURISDICTION AND NON-ASSIGNABILITY
This Agreement will be construed in accordance with the laws of the
State of California and is non-assignable by the parties hereto. Subject to the
foregoing, this Agreement shall be binding upon and shall inure to the benefit
of the Parties and their respective successors and assigns.
11 FUND PORTFOLIOS AND CLASSES
The portfolios, series and classes of shares of Fund to which this
Agreement shall apply are designated in Schedule C hereto.
12 EXHIBITS AND SCHEDULES
Schedules A, B, C and D, which are attached hereto, are each a part of
and is incorporated by reference into this Agreement. This Agreement shall not
be deemed to be complete absent such Schedules A, B, C or D
13 ENTIRE AGREEMENT; SEVERABILITY
Each Party recognizes the existence of a Dealer Agreement between Fund
and E*TRADE, dated ____, or a Fund/SERV Agreement between Fund Affiliate and
E*TRADE, dated ____, as supplemented by a Supplemental Agreement Regarding
Networking, dated _____ ("Other Agreements"). To the extent of any inconsistency
or conflict between the provisions of this Agreement and any provision of the
Other Agreements, such provision of the Other Agreements shall govern, and the
provision of this Agreement shall be null and void. Except as specified in this
Section 13, however, this Agreement shall supersede any existing agreements
between the parties containing general terms and conditions for retail
shareholder services. Each provision and agreement herein shall be treated as
separate and independent from any other provision or agreement herein and shall
be enforceable notwithstanding the unenforceability of any such other provision
or agreement.
-4-
<PAGE>
14 REPRESENTATIONS OF THE PARTIES
Each Party represents and warrants to each other Party that (i) it is
duly authorized to execute and deliver this Agreement and to perform its
obligations hereunder and has taken all necessary action to authorize such
execution, delivery and performance, (ii) the person signing this Agreement on
its behalf is duly authorized to do so, (iii) it has obtained all authorizations
of any governmental body required in connection with this Agreement and such
authorizations are in full force and effect and (iv) the execution, delivery and
performance of this Agreement will not violate any law, ordinance, charter, by-
law or rule applicable to it or any agreement by which it is bound or by which
any of its assets are affected.
15 COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original, but all of which together shall
constitute one and the same instrument.
-5-
<PAGE>
In witness whereof, each Party has executed this Agreement by a duly
authorized representative of such Party.
THE RBB FUND, INC. PROVIDENT DISTRIBUTORS, INC.
- ---------------------------------- ----------------------------------
(Name of Fund Company) (Name of Fund Affiliate)
By: ___________________________ By: ___________________________
Name: ___________________________ Name: ___________________________
Title: ___________________________ Title: ___________________________
Date: ___________________________ Date: ___________________________
BOSTON PARTNERS By: ___________________________
ASSET MANAGEMENT, L.P. E*TRADE Group, Inc.
By: BOSTON PARTNERS, INC.
its General Partner
By: ___________________________
Title:
-6-
<PAGE>
SCHEDULE A
Services
1. RECORD MAINTENANCE
E*TRADE shall maintain the following records with respect to a Fund
for each customer who holds Fund shares in an E*TRADE brokerage account:
a. Number and class of shares;
b. Date, price and amount of purchases and redemptions (including
dividend reinvestments) and dates and amounts of dividends paid for at least the
current year to date;
c. Name and address of the customer, including zip codes and social
security numbers or taxpayer identification numbers; and information regarding
withholdings
d. Records of distributions and dividend payments;
e. Any transfers of shares; and
f. Overall control records.
2 SHAREHOLDER COMMUNICATIONS
E*TRADE shall:
a. Provide to an approved shareholder mailing agent for the purpose
of providing certain Fund-related materials the names and addresses of all
E*TRADE customers who hold shares of such Fund in their E*TRADE brokerage
accounts. The shareholder mailing agent shall be a person or entity with whom
the Fund has arranged for the distribution of certain Fund-related material in
accordance with the Fund/SERV Agreement. The Fund-related materials shall
consist of updated prospectuses and any supplements and amendments thereto,
annual and other periodic reports, proxy or information statements and other
appropriate shareholder communications. In the alternative, in accordance with
the Fund/SERV Agreement, E*TRADE may distribute the Fund-related materials to
its customers.
b. Deliver current Fund prospectuses and statements of additional
information and annual and other periodic reports upon customer request and, as
applicable, with confirmation statements;
c. Deliver statements to customers on a monthly basis (or, as to
accounts in which there has been no activity in a particular month, no less
frequently than quarterly) showing, among other things, the number of shares of
each Fund owned by such customer and the net asset value of such Fund as of a
recent date;
<PAGE>
d. Produce and provide to customers confirmation statements
reflecting purchases and redemptions of shares of each Fund in E*TRADE brokerage
accounts;
e. Respond to customer inquiries regarding, among other things,
share prices, account balances, dividend amounts and dividend payment dates; and
3. TRANSACTIONAL SERVICES
E*TRADE shall communicate, as to shares of each Fund, purchase,
redemption and exchange orders reflecting the orders it receives from its
customers. E*TRADE shall also communicate, as to shares of each Fund, mergers,
splits and other reorganization activities.
4. TAX INFORMATION RETURNS AND REPORTS
E*TRADE shall prepare and file with the appropriate governmental
agencies, such information, returns and reports as are required to be so filed
for reporting (i) dividends and other distributions made, (ii) amounts withheld
on dividends and other distributions and payments under applicable federal and
state laws, rules and regulations, and (iii) gross proceeds of sales
transactions as required.
5. FUND COMMUNICATIONS
E*TRADE shall, on a monthly basis and for each Fund, report the number
of shares on which the Fee is to be paid pursuant to this Agreement. Such
summaries shall be expressed in both shares and dollar amounts.
-2-
<PAGE>
SCHEDULE B
Calculation of Fee
The Fee shall be calculated by multiplying the Daily Value of Qualifying Shares
by the appropriate Fee Rate (indicated below). The Fee shall be paid monthly in
arrears.
The Daily Value of Qualifying Shares is the aggregate daily value of all shares
of the Fund held in E*TRADE brokerage accounts, subject to the following
exclusions. There shall be excluded from the shares: (i) shares as to which a
brokerage customer paid E*TRADE a transaction fee upon the purchase of such
shares; (ii) shares held in an E*TRADE brokerage account prior to the effective
date of this Agreement as to the Fund; and, (iii) shares first held in an
E*TRADE brokerage account after the termination of this Agreement as to the
Fund.
The Fee Rate is determined based on the aggregate value of the Qualifying Shares
of all Funds listed on Schedule C, as amended from time to time, as of the prior
review date. The review dates are December 31, and June 30. The Fee Rate is
effective from the next business day following the review date up to and
including the next review date. The Fee Rates are as follows:
Up to and including $750 million 35 basis points
Over $750 million and up to
And including $1.5 billion 30 basis points
Over $1.5 billion 25 basis points
Note: The rate scale is not intended to produce a "blended rate." Rather, once
a threshold is reached, the rate applicable to the total amount of assets will
be used for all assets.
For purposes of this exhibit, the daily value of the shares of each Fund will be
the net asset value reported by such Fund to the National Association of
Securities Dealers, Inc. Automated Quotation System. No adjustments will be made
to the net asset values to correct errors in the net asset values so reported
for any day unless such error is corrected and the corrected net asset value per
share is reported to E*TRADE before 5 o'clock p.m., Palo Alto time, on the first
business day after the day to which the error relates.
As soon as is possible after the end of the month, E*TRADE shall provide to the
Fund Parties an invoice for the amount of the Fee due for each Fund. In the
calculation of such Fee, E*TRADE's records shall govern unless an error can be
shown in the number of shares used in such calculation.
Fund Parties shall pay E*TRADE the Fee within thirty (30) days after the Fund
Parties receipt of such statement. Such payment shall be by wire transfer,
unless the amount thereof is less than $250.00. Such wire transfers shall be
separate from wire transfers of redemption proceeds or other distributions.
Amounts less than $250.00 may be paid, at Fund Parties' discretion, by check.
<PAGE>
Schedule C
Fund Portfolios and Classes
Fund Name/Class: Cusip/Ticker Symbol:
- ---------------- --------------------
Boston Partners Bond Fund _____________________________________
- --------------------------------------
Boston Partners Market Neutral Fund _____________________________________
- --------------------------------------
Boston Partners Long-Short Equity Fund _____________________________________
- --------------------------------------
Boston Partners Large Cap Value Fund _____________________________________
- --------------------------------------
Boston Partners Mid Cap Value Fund _____________________________________
- --------------------------------------
Boston Partners Micro Cap Value Fund _____________________________________
- --------------------------------------
Asterisk indicates that Fund is a "No-Load" or "No-Sales Charge" Fund as defined
in Section 26 of the NASD's Rules of Fair Practice.
The RBB Fund, Inc. Provident Distributors, Inc.
- ------------------ -------------------------------------
(Name of Fund Company) (Name of Fund Affiliate)
400 Bellevue Parkway Four Falls Corporate Center
- -------------------------------------- -------------------------------------
(Address) (Address)
Wilmington, DE 19809 West Conshohocken, PA 19428
- -------------------------------------- -------------------------------------
By: _______________________________ By: _____________________________
Name: _______________________________ Name: _____________________________
Title: _______________________________ Title: _____________________________
Date: _______________________________ Date: _____________________________
BOSTON PARTNERS By: _____________________________
ASSET MANAGEMENT, L.P. E*TRADE Group, Inc.
By: BOSTON PARTNERS, INC. Date: _____________________________
its General Partner
288 State Street
Boston, MA 02109
By: _______________________________
Name: _______________________________
Title: _______________________________
Date: _______________________________
<PAGE>
Schedule D
Payment of Fee
<TABLE>
<CAPTION>
Over
Up to and $750MM
Including and under Over
$750 MM $1.5 BB $1.5BB
<S> <C> <C> <C>
Adviser:
.14% .9% .4%
--------- --------- ------
Fund Company:
12b-1/Provident Distributors, Inc. .21% .21% .21%
--------- --------- ------
Fee Rate Percentage Per
Annum of Average Daily
Value of Fund Shares 0.35% 0.30% 0.25%
</TABLE>
The RBB Fund, Inc. Provident Distributors, Inc.
- ------------------ ----------------------------
(Name of Fund Company) (Name of Fund Affiliate)
By: _______________________________ By: _____________________________
Name: _______________________________ Name: _____________________________
Title: _______________________________ Title: _____________________________
Date: _______________________________ Date: _____________________________
BOSTON PARTNERS
ASSET MANAGEMENT, L.P.
By: BOSTON PARTNERS, INC.
its General Partner
By: _______________________________
Title:
<PAGE>
Law Offices
DRINKER BIDDLE & REATH LLP
One Logan Square
18/th/ and Cherry Streets
Philadelphia, PA 19103-6996
Telephone: (215) 988-2700
Fax: (215) 988-2757
September 15, 1999
The RBB Fund, Inc.
Bellevue Park Corporate Center
400 Bellevue Parkway, Suite 100
Wilmington, Delaware 19809
Re: Shares Registered by Post-Effective Amendment No. 66 to
Registration Statement on Form N-1A (File No. 33-20827)
-------------------------------------------------------
Ladies and Gentlemen:
We have acted as counsel to The RBB Fund, Inc. (the "Company") in
connection with the preparation and filing with the Securities and Exchange
Commission on July 2, 1999 of Post-Effective Amendment No. 66 (the "Amendment")
to the Company's Registration Statement on Form N-1A under the Securities Act of
1933, as amended (the "1933 Act"). The Board of Directors of the Company has
authorized the issuance and sale by the Company of: (i) 100 million shares of
Class NNN common stock, $.001 par value per share, representing interests in the
Institutional Class of the Bogle Investment Management Small Cap Growth Fund,
and (ii) 100 million shares of Class OOO common stock, $.001 par value per
share, representing interests in the Investor Class of the Bogle Investment
Management Small Cap Growth Fund (collectively, the "Shares"). The Amendment
registered an indefinite number of the Shares.
We have reviewed the Company's Certificate of Incorporation, ByLaws,
resolutions of its Board of Directors, and such other legal and factual matters
as we have deemed appropriate. This opinion is based exclusively on the
Maryland General Corporation Law and the federal law of the United States of
America.
Based upon and subject to the foregoing, it is our opinion that the Shares,
when issued for payment as described in the Company's Prospectus offering the
Shares and in accordance with the Company's Articles of Incorporation (including
Articles Supplementary thereto filed with the Maryland Department of Assessments
and Taxation to authorize, classify and establish the Shares) for not less than
$.001 per share, will be legally issued, fully paid and non-assessable by the
Company.
<PAGE>
We hereby consent to the filing of this opinion as an exhibit to a Post-
Effective Amendment to the Company's Registration Statement.
Very truly yours,
/s/ Drinker Biddle & Reath LLP
------------------------------
DRINKER BIDDLE & REATH LLP
<PAGE>
CONSENT OF COUNSEL
We hereby consent to the use of our name and to the reference to our Firm
under the caption "Counsel" in the Statement of Additional Information that is
included in Post-Effective Amendment No. 67 to the Registration Statement (No.
33-20827; 811-5518) on Form N-1A of The RBB Fund, Inc., under the Securities Act
of 1933 and the Investment Company Act of 1940, respectively. This consent does
not constitute a consent under section 7 of the Securities Act of 1933, and in
consenting to the use of our name and the references to our Firm under such
caption we have not certified any part of the Registration Statement and do not
otherwise come within the categories of persons whose consent is required under
said section 7 or the rules and regulations of the Securities and Exchange
Commission thereunder.
/s/ DRINKER BIDDLE & REATH LLP
------------------------------
DRINKER BIDDLE & REATH LLP
Philadelphia, Pennsylvania
September 30, 1999
<PAGE>
PURCHASE AGREEMENT
------------------
The RBB Fund, Inc. (the "Fund"), a Maryland corporation, and Bogle
Investment Management, L.P. ("BIM") intending to be legally bound, hereby agree
with each other as follows:
1. The Fund hereby offers BIM and BIM hereby purchases $1,000 worth of
shares of each of Classes NNN and OOO Common Stock of the Fund (par value $.001
per share) (such shares hereinafter sometimes collectively known as "Shares") at
a price per Share equivalent to the net asset value per share of the Shares of
the Fund as determined on September 15, 1999.
2 The Fund hereby acknowledges receipt from BIM of funds in the amount
of $2,000 in full payment for the Shares.
3. BIM represents and warrants to the Fund that the Shares are being
acquired for investment purposes and not with a view to the distribution
thereof.
4. This agreement may be executed in counterparts, and all such
counterparts taken together shall be deemed to constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the 15/th/ day of September, 1999.
THE RBB FUND, INC.
By: /s/ Edward J. Roach
------------------------
Edward J. Roach
President & Treasurer
BOGLE INVESTMENT MANAGEMENT, L.P.
By: /s/ John Bogle, Jr.
-----------------------
John Bogle, Jr.
