<PAGE>
As filed with the Securities and Exchange Commission on November 29, 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. 69 [X]
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 71 [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 filing pursuant to paragraph (b)
[X] on December 1, 1999 pursuant to paragraph (b)
[_] 60 days after filing pursuant to paragraph (a)(1)
[_] on (date) 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 L.P.(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
INTRODUCTION TO RISK/RETURN SUMMARY
Who Should Invest............................................ 1
Numeric's Investment Style................................... 1
DESCRIPTIONS OF THE FUNDS
A look at the goals, strategies, risks, expenses and financial history of each
Fund.
n/i numeric investors Micro Cap Fund.......................... 3
n/i numeric investors Growth Fund............................. 4
n/i numeric investors Mid Cap Fund............................ 6
n/i numeric investors Larger Cap Value Fund................... 8
n/i numeric investors Small Cap Value Fund.................... 10
Additional Information on Fund Investments.................... 12
MANAGEMENT
Investment Adviser............................................ 12
Service Provider Chart........................................ 14
Details on the management and operations of the Funds.
SHAREHOLDER INFORMATION
Pricing of Fund Shares........................................ 15
Purchase of Fund Shares....................................... 15
Redemption of Fund Shares..................................... 17
Exchange Privilege............................................ 19
Dividends and Distributions................................... 20
Taxes......................................................... 20
Policies and instructions for opening, maintaining and closing an account in any
of the Funds.
FINANCIAL HIGHLIGHTS............................................ 21
FOR MORE INFORMATION................................. See Back Cover
<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 (formerly, n/i numeric investors Growth & Value
Fund), n/i numeric investors Larger Cap Value Fund and n/i numeric investors
Small Cap Value Fund (each a "Fund," collectively the "Funds"). 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.(R) ("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 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 Estrend(TM) 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
1
<PAGE>
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 are more likely to 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 increase. 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.
2
<PAGE>
DESCRIPTION OF THE FUNDS
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.
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.
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,
such as that experienced by the Fund, could result in the realization of
taxable capital gains.
Risk/Return Information
The chart and table below give you a picture of the variability 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.
Annual Total Returns
As of December 31
[CHART]
1996 1997 1998
---- ---- ----
16.85% 30.86% 16.27%
Year to date total return for the nine months ended September 30, 1999: 7.37%
<TABLE>
<S> <C> <C>
Best Quarter: 28.66% (quarter ended December 31, 1998)
Worst Quarter: (17.81)% (quarter ended September 30, 1998)
</TABLE>
3
<PAGE>
Average Annual Total Returns--Comparison
As of December 31, 1998
<TABLE>
<CAPTION>
1 Year Since Inception
------ ---------------
<S> <C> <C>
n/i numeric investors
Micro Cap Fund*........................................ 16.27% 24.95%
Russell 2000 Growth Index**............................. 1.23% 2.38%
</TABLE>
- --------
* Commenced operations on June 3, 1996.
** 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 to earnings ratios. 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.
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 ended (August 31, 1999).
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)
<TABLE>
<S> <C>
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%
=====
</TABLE>
- --------
* 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. The example assumes that you
invest $10,000 in the Fund for the time periods indicated and then redeem all
of your shares at the end of each period. The example also assumes that your
investment has a 5% return each year and that the Fund's operating expenses
remain the same. Although your actual cost may be higher or lower, based on
these assumptions your costs would be:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C>
$102 $374 $667 $1,500
</TABLE>
n/i numeric investors Growth Fund
Ticker Symbol: NISGX
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.
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.
4
<PAGE>
. 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.
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,
such as that experienced by the Fund, could result in the realization of
taxable capital gains.
Risk/Return Information
The chart and table below give you a picture of the variability 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.
Annual Total Returns
As of December 31
[CHART]
1996 1997 1998
---- ---- ----
10.42% 15.61% 2.22%
Year to date total return for the nine months ended September 30, 1999: 14.03%
<TABLE>
<S> <C> <C>
Best Quarter: 27.14% (quarter ended December 31, 1998)
Worst Quarter: (25.96)% (quarter ended September 30, 1998)
</TABLE>
Average Annual Total Returns--Comparison
As of December 31, 1998
<TABLE>
<CAPTION>
1 Year Since Inception
------ ---------------
<S> <C> <C>
n/i numeric investors Growth Fund*....................... 2.22% 10.85%
Russell 2500 Growth Index**.............................. 3.09% 5.56%
</TABLE>
- --------
* 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 to
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.
5
<PAGE>
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 ended (August 31, 1999).
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)
<TABLE>
<S> <C>
Management fees+........................................................ 0.75%
Rule 12b-1 fees......................................................... None
Other expenses.......................................................... 0.55%
-----
Total annual Fund operating expenses.................................... 1.30%
Fee waivers*............................................................ (0.30)%
-----
Net expenses............................................................ 1.00%
=====
</TABLE>
- --------
+ 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
The example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. The example assumes that you
invest $10,000 in the Fund for the time periods indicated and then redeem all
of your shares at the end of each period. The example also assumes that your
investment has a 5% return each year and that the Fund's operating expenses
remain the same . Although your actual costs may be higher or lower, based on
these assumptions your cost would be:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C>
$102 $383 $684 $1,541
</TABLE>
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.
n/i numeric investors Mid Cap Fund
Ticker Symbol: NIGVX
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.
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.
6
<PAGE>
. 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.
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,
such as that experienced by the Fund, could result in the realization of
taxable capital gains.
Risk/Return Information
The chart and table below give you a picture of the variability 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.
Annual Total Returns
As of December 31
[CHART]
1996 1997 1998
---- ---- ----
11.41% 33.07% 13.88%
Year to date total return for the nine months ended September 30, 1999: 7.53%
<TABLE>
<S> <C> <C>
Best Quarter: 20.51% (quarter ended December 31, 1998)
Worst Quarter: (18.85)% (quarter ended September 30, 1998)
</TABLE>
Average Annual Total Returns--Comparison
As of December 31, 1998
<TABLE>
<CAPTION>
1 Year Since Inception
------ ---------------
<S> <C> <C>
n/i numeric investors
Mid Cap Fund*......................................... 13.88% 22.48%
S&P MidCap 400 Index**................................. 19.11% 22.62%
</TABLE>
- --------
* 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 ended (August 31, 1999).
7
<PAGE>
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)
<TABLE>
<S> <C>
Management fees+........................................................ 0.75%
Rule 12b-1 fees......................................................... None
Other expenses.......................................................... 0.58%
-----
Total annual Fund operating expenses.................................... 1.33%
Fee waivers*............................................................ (0.33)%
-----
Net expenses............................................................ 1.00%
=====
</TABLE>
- --------
+ 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
The example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. The example assumes that you
invest $10,000 in the Fund for the time periods indicated and then redeem all
of your shares at the end of each period. The example also assumes that your
investment has a 5% return each year and that the Fund's operating expenses
remain the same . Although your actual costs may be higher or lower, based on
these assumptions your cost would be:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C>
$102 $389 $697 $1,573
</TABLE>
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.
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.
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.
8
<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,
such as that experienced by the Fund, could result in the realization of
taxable capital gains.
Risk/Return Information
The chart and table below give you a picture of the variability 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.
Annual Total Returns
As of December 31
[CHART]
1998
----
10.78%
Year to date total return for the nine months ended September 30, 1999: (1.39)%
<TABLE>
<S> <C> <C>
Best Quarter: 16.07 % (quarter ended March 31, 1998)
Worst Quarter: (14.58)% (quarter ended September 30, 1998)
</TABLE>
Average Annual Total Returns--Comparison
As of December 31, 1998
<TABLE>
<CAPTION>
1 Year Since Inception
------ ---------------
<S> <C> <C>
n/i numeric investors
Larger Cap Value Fund*................................. 10.78% 10.75%
Russell 1000 Value Index**.............................. 15.63% 14.85%
</TABLE>
- --------
* 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 to earnings ratios, higher dividend yields, and lower forecasted
growth values.
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 ended (August 31, 1999).
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)
<TABLE>
<S> <C>
Management fees......................................................... 0.75%
Rule 12b-1 fees......................................................... None
Other expenses.......................................................... 1.05%
-----
Total annual Fund operating expenses.................................... 1.80%
Fee waivers*............................................................ (0.80)%
-----
Net expenses............................................................ 1.00%
=====
</TABLE>
- --------
* 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%.
9
<PAGE>
Example
The example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds. The example assumes that you
invest $10,000 in the Fund for the time periods indicated and then redeem all
of your shares at the end of each period. The example also assumes that your
investment has a 5% return each year and that the Fund's operating expenses
remain the same. Although your actual costs may be higher or lower, based on
these assumptions your cost would be:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C>
$102 $488 $900 $2,050
</TABLE>
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.
n/i numeric investors
Small Cap Value Fund
Ticker Symbol: NISVX
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 $2.0 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.
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.
10
<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,
such as that experienced by the Fund, could result in the realization of
taxable capital gains.
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 ended (August 31, 1999).
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)**
<TABLE>
<S> <C>
Management fees+........................................................ 0.75%
Rule 12b-1 fees......................................................... None
Other expenses.......................................................... 1.84%
-----
Total annual Fund operating expenses.................................... 2.59%
Fee waivers*............................................................ (1.59)%
-----
Net expenses............................................................ 1.00%
=====
</TABLE>
- --------
+ 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%.
** For the period November 30, 1998 (commencement of operations) through
August 31, 1999, annualized.
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. The example assumes that you
invest $10,000 in the fund for the time periods indicated and then redeem all
of your shares at the end of each period. The example also assumes that your
investment has a 5% return each year and that the Fund's operating expenses
remain the same. Although your actual costs may be higher or lower, based on
these assumptions your cost would be:
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C>
$102 $654 $1,232 $2,806
</TABLE>
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.
11
<PAGE>
ADDITIONAL INFORMATION ON FUND INVESTMENTS
Each Fund may lend its portfolio securities to financial institutions. A 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% of
the value of the Fund's total assets. Lending a 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.
A Fund may borrow money for temporary or emergency (not leveraging) purposes.
Each Fund will not make any additional investments while borrowings exceed 5%
of its total assets.
Year 2000--The Funds, like any business, could be affected if the computer
systems on which they rely do not properly process information beginning on
January 1, 2000. While Year 2000 issues could have a negative effect on the
Funds, Numeric has been working to avoid such problems. The Company has also
been 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 Funds hold or securities
markets generally.
MANAGEMENT
Investment Adviser
Numeric Investors L.P.(R) 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 $4.0
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. 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 and n/i numeric investors Larger Cap Value
Fund, Numeric received investment advisory fees of 0.63%, 0.58%, 0.55% and
0.38%, respectively of each Fund's average daily net assets, after fee waivers
and reimbursements, if any. Numeric waived its advisory fee entirely for n/i
numeric investors Small Cap Value Fund.
Numeric is entitled to a management fee of 0.75% of the n/i numeric Investors
Micro Cap Fund's and n/i numeric investors Larger Cap Value Fund's average
daily net assets before fee waivers and expense reimbursements, if any.
Until January 1, 2001, Numeric is entitled to a management fee of 0.75% of the
n/i numeric investors Growth Fund's, n/i numeric investors Mid Cap Fund's and
n/i numeric investors Small Cap Value Fund's average daily net assets before
fee waivers and expense reimbursements, if any. Thereafter, Numeric is
entitled to a performance based fee for the n/i numeric investors Growth Fund,
n/i numeric investors Mid Cap Fund and n/i numeric investors Small Cap Value
Fund. The current fee of 0.75% would only increase if performance exceeds the
benchmark by 4.00% or more in a given 12-month period and would be less than
the current fee if performance does not exceed the benchmark by 3.00% 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
12
<PAGE>
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 Growth, Mid Cap and Small Cap Value Funds is the Russell 2500
Growth Index, S&P MidCap 400 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.
13
<PAGE>
[CHART]
-----------------------------------
Shareholders
-----------------------------------
Distribution -------------------------------- ---------------------------------
and Principal Distributor Transfer Agent
Shareholder
Services Provident Distributors, Inc. PFPC Inc.
Four Falls Corporate Center, 400 Bellevue Parkway
6th Fl. Wilmington, DE 19809
West Conshohocken, PA 19428
Handles shareholders services,
including record-keeping and
statement, distribution of
dividends and processing
of buy and sell requests.
-------------------------------- ---------------------------------
Asset -------------------------------- ---------------------------------
Management Investment Adviser Custodian
Numeric Investors LP(R) Custodial Trust Company
One Memorial Drive 101 Carnegie Center
Cambridge, MA 02142 Princeton, NJ 05840
Manages each Fund's business Holds each Fund's assets,
and all investment activities. settles all portfolio trades
and collects most valuation data
for calculating each Fund's net
asset value ("NAV")
-------------------------------- ---------------------------------
Fund -------------------------------- ---------------------------------
Operations Co-Administrator Board of Directors
Bear Stearns Funds Supervises the fund's activities.
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.
--------------------------------
14
<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 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. 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 as described
below under "Initial Investment by Mail". 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 $7.50 is assessed and charged to the
shareholder. 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 for purchase of shares 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. (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.
15
<PAGE>
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), or 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 for purchase of shares 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 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 1-800-348-5031
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
16
<PAGE>
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 family of
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.
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 the affected 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. For purposes of this redemption feature, shares
purchased first will be considered to be shares first redeemed.
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. A wire
charge of $7.50 is assessed and charged to the shareholder. If the telephone
redemption option or the telephone exchange option (as described below)
17
<PAGE>
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 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 as a shareholder may incur additional expenses and
such transactions may have tax consequences.
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,
18
<PAGE>
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 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 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 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 may potentially disrupt
the management of the Funds and increase transactions costs, the Funds have
19
<PAGE>
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 a portion of
your purchase price. 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) are not 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,
(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. Shareholders 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. Shareholders should
consult their tax advisers regarding the tax status of distributions in their
state and locality.
20
<PAGE>
FINANCIAL HIGHLIGHTS
The table below sets forth certain financial information for the periods
indicated, including per share information 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. This information has been derived
from each Fund's financial statements audited by PricewaterhouseCoopers LLP,
the Company's independent accountants. This information should be read in
conjunction with each Fund's financial statements which, together with the
report of independent accountants, are included in the Funds' annual report,
which is available upon request (see back cover for ordering instructions).
<TABLE>
<CAPTION>
MICRO CAP FUND GROWTH FUND
----------------------------------------- -----------------------------------------
Fiscal Fiscal Fiscal Fiscal Fiscal Fiscal
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>
Per Share Operating
Performance
Net asset value,
beginning of period..... $ 12.52 $ 18.47 $ 11.67 $ 12.00 $ 9.75 $ 16.29 $ 11.84 $ 12.00
------- ------- -------- ------- ------- ------- -------- --------
Net investment
income/(loss).......... (0.18) (0.07) (0.01) 0.01 (0.18) (0.07) (0.04) 0.01
Net realized and
unrealized gain/(loss)
on investments and
futures transactions,
if any................. 6.72 (3.23) 6.82 (0.34) 5.33 (3.98) 4.50 (0.17)
------- ------- -------- ------- ------- ------- -------- --------
Net increase/(decrease)
in net assets resulting
from operations......... 6.54 (3.30) 6.81 (0.33) 5.15 (4.05) 4.46 (0.16)
------- ------- -------- ------- ------- ------- -------- --------
Dividends and
distributions to
shareholders from
Net investment income... -- -- (0.01) -- -- -- (0.01) --
Net realized capital
gains.................. (1.03) (2.65) -- -- (0.01) (2.49) -- --
------- ------- -------- ------- ------- ------- -------- --------
Total dividends and
distributions to
shareholders........... (1.03) (2.65) (0.01) -- (0.01) (2.49) (0.01) --
------- ------- -------- ------- ------- ------- -------- --------
Net asset value, end of
period.................. $ 18.03 $ 12.52 $ 18.47 $ 11.67 $ 14.89 $ 9.75 $ 16.29 $ 11.84
======= ======= ======== ======= ======= ======= ======== ========
Total investment
return(2)............... 56.09% (20.74)% 58.41% (2.75)% 52.80% (29.03)% 37.69% (1.33)%
======= ======= ======== ======= ======= ======= ======== ========
Ratios/Supplemental Data
Net assets, end of period
(000's omitted)......... $76,349 $99,266 $142,119 $14,100 $62,376 $77,840 $117,724 $ 26,756
Ratio of expenses to
average net asset(1).... 1.00% 1.00% 1.00% 1.00%(3) 1.00% 1.00% 1.00% 1.00%(3)
Ratio of expenses to
average net assets
without waivers and
expense reimbursements.. 1.26% 1.23% 1.45% 3.45%(3) 1.30% 1.24% 1.40% 2.62%(3)
Ratio of net investment
income/(loss) to average
net assets(1)........... (0.46)% (0.41)% (0.06)% 0.73%(3) (0.45)% (0.50)% (0.38)% 0.71%(3)
Portfolio turnover rate.. 316.02% 408.70% 233.49% 42.92% 309.60% 338.40% 266.25% 19.21%
</TABLE>
- --------
* Commencement of operations.
(1) Reflects waivers and reimbursements.
(2) Total investment return is calculated assuming a purchase of shares on the
first day and a sale of shares on the last day of each period reported and
includes reinvestments of dividends and distributions, if any. Total
investment returns are not annualized.
(3) Annualized.
21
<PAGE>
<TABLE>
<CAPTION>
Larger Cap Small Cap
Mid Cap Fund Value Fund Value Fund
--------------------------------------- -------------------- ------------
Fiscal Fiscal Fiscal Fiscal
Year Year Year Period Year Period Period
Ended Ended Ended 6/3/96* to Ended 12/9/97* to 11/30/98* to
8/31/99 8/31/98 8/31/97 8/31/96 8/31/99 8/31/98 8/31/99
------- -------- ------- ---------- ------- ----------- ------------
Per Share Operating
Performance
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period.... $ 13.30 $ 17.16 $ 11.56 $12.00 $10.84 $ 12.00 $ 12.00
------- -------- ------- ------ ------ ------- -------
Net investment income.. 0.05 0.05 0.08 0.03 0.19 0.06 0.10
Net realized and
unrealized gain/(loss)
on investments and
futures transactions,
if any................ 4.97 (1.24) 5.58 (0.47) 2.58 (1.22) 0.76
------- -------- ------- ------ ------ ------- -------
Net increase/(decrease)
in net assets
resulting from
operations............ 5.02 (1.19) 5.66 (0.44) 2.77 (1.16) 0.86
------- -------- ------- ------ ------ ------- -------
Dividends and
distributions to
shareholders from:
Net investment income.. (0.06) (0.06) (0.06) -- (0.11) -- --
Net realized capital
gains................. (1.37) (2.61) -- -- (0.23) -- --
------- -------- ------- ------ ------ ------- -------
Total dividends and
distributions to
shareholders.......... (1.43) (2.67) (0.06) -- (0.34) -- --
------- -------- ------- ------ ------ ------- -------
Net asset value, end of
period................. $ 16.89 $ 13.30 $ 17.16 $11.56 $13.27 $ 10.84 $ 12.86
======= ======== ======= ====== ====== ======= =======
Total investment
return(2).............. 41.61% (8.97)% 49.11% (3.67)% 26.01% (9.67)% 7.17%
======= ======== ======= ====== ====== ======= =======
Ratios/Supplemental Data
Net assets, end of
period (000's
omitted)............... $49,156 $110,176 $52,491 $3,813 $8,256 $25,257 $11,498
Ratio of expenses to
average net assets(1).. 1.00% 1.00% 1.00% 1.00%(3) 1.00% 1.00%(3) 1.00%(3)
Ratio of expenses to
average net assets
without waivers and
expense
reimbursements......... 1.33% 1.26% 1.81% 8.98%(3) 1.80% 2.20%(3) 2.59%(3)
Ratio of net investment
income to average net
assets(1).............. 0.31% 0.36% 0.79% 1.89%(3) 1.02% 1.26%(3) 1.15%(3)
Portfolio turnover
rate................... 384.71% 341.73% 263.83% 5.25% 304.89% 166.81% 212.55%
</TABLE>
- --------
* Commencement of operations.
(1) Reflects waivers and reimbursements.
(2) Total investment return is calculated assuming a purchase of shares on the
first day and a sale of shares on the last day of each period reported and
includes reinvestments of dividends and distributions, if any. Total
investment returns are not annualized.
(3) Annualized.
22
<PAGE>
n/i numeric investors family of funds
800.numeric (686-3742)
www.numeric.com
ACCOUNT APPLICATION
Important Information:
. Retirement Accounts: Do not use this information to open an individual
retirement plan account (such as an IRA). For an IRA application or help with
this application, please call 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 Investors on their website,
www.numeric.com or by phone 800-686-3742
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
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 PO BOX APARTMENT NUMBER
- --------------------------------------------------------------------------------
CITY STATE ZIP
( ) ( )
- --------------------------------------------------------------------------------
DAYTIME PHONE NUMBER EVENING PHONE NUMBER
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.
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).
(please complete other side)
NOT PART OF THE PROSPECTUS
<PAGE>
5. TELEPHONE EXCHANGE AND REDEMPTION:
To use either or both of these options, you must initial the appropriate line
below.
I authorize the Transfer Agent to accept instructions from any person to
exchange and/or redeem 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 numeric investors Fund.
- ----------
initial joint initial
Redeem shares, and send the proceeds to the address of record.
- ----------
initial joint initial
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 to purchase shares of a specified n/i
numeric investors family of funds Fund.
Please debit $ (total) from my checking account (named below) on or about
the 20th of every month.
$ _____________ into the Fund Start Month.
$100 minimum
$ _____________ into the Fund Start Month.
$100 minimum
$ _____________ into the Fund Start Month.
$100 minimum
$ _____________ into the Fund Start Month.
$100 minimum
$ _____________ into the Fund Start Month.
$100 minimum
7. SYSTEMATIC WITHDRAWAL PLAN:
Please attach an unsigned, voided check.
. 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
To Select option, check box, and fill out the information below:
[_] For deposit of redemption proceeds into your Bank account:
Fund Name _______________ Amount __________________
Startup Month ___________
Frequency Options: [_] Annually [_] Monthly
[_] Quarterly
[_] For transfer to an existing n/i numeric investors Fund account: (For
transfers from more than one existing account, please call 800-348-5031)
I authorize PFPC Inc. to withdraw a total of $ ($50 minimum per fund)
from my ______________________/_________________ to purchase shares of the
(Fund Name) (Account Number)
following Fund(s):
(1) (please list fund name(s) $
(2) (please list fund name(s) $
(3) (please list fund name(s) $
(4) (please list fund name(s) $
Startup Month: ____
Frequency Options: [_] Annually [_] Monthly
[_] Quarterly
8. BANK OF RECORD:
Complete only if using Automatic Investment Plan (Section 6) Systematic
Withdrawal plan (Section 7), or choose to have your dividends and/or capital
gains electronically credited to your bank account (Section 4)
- -------------------------------------------------------------------------------
BANK NAME
- -------------------------------------------------------------------------------
STREET NAME OR PO BOX
- -------------------------------------------------------------------------------
CITY STATE ZIP CODE
- -------------------------------------------------------------------------------
BANK ABA NUMBER BANK ACCOUNT NUMBER
NOT PART OF THE PROSPECTUS
<PAGE>
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 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 certification required to audit backup withholding.
x ________________________________________ / ___________ / _______________
SIGNATURE OF APPLICANT DATE
________________________________________________________________________________
PRINT NAME TITLE(IF APPLICABLE)
________________________________________________________________________________
SIGNATURE OF JOINT OWNER
________________________________________________________________________________
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 qualifies retirements, or for wire instructions, please call us at
800-348-5031.
For information on new or existing accounts call 800-348-5031.
Mail completed Account Application and check to:
n/i numeric investors
c/o PFPC Inc.
PO Box 9866
Wilmington, DE 19899-8966
or fax back to: 302-791-1074
NOT PART OF THE PROSPECTUS
<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 and economic trends. The Annual Report
includes 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 20 separate investment portfolios. This Statement of Additional
Information pertains to Shares representing interests in the diversified 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. The market for micro cap
securities may be thinly traded and, as a result , greater fluctuations in the
price of micro cap securities may occur.
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. The ultimate result of these
factors may be a loss of dollars.
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. Depending on the asset levels that are required to be
segregated, a Fund may be required to sell assets it would not otherwise
liquidate.
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. The original
long position must also be held for the sixty days after the short position is
closed.) 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. If the
securities held by a Fund should decline in value while borrowings are
outstanding, the net asset value of a Fund's outstanding shares will decline in
value by proportionately more than the decline in value suffered by a Fund's
securities. As a result, a Fund's share price may be subject to greater
fluctuation until the borrowing is paid off. 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.
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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 and the return
on the cash exchanged for the securities.
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. 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 Company's Board of Directors can change the
investment objective of each Fund. However, shareholders will generally be given
30 days notice before any change is made.
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 business and affairs of the Company are managed under the direction
of the Company's Board of Directors. The directors and executive officers of the
Fund, their ages, business addresses and principal occupations during the past
five years are:
<TABLE>
<CAPTION>
Principal Occupation
Name and Address and Age Position with Fund During Past Five Years
- ------------------------ ------------------ ----------------------
<S> <C> <C>
Arnold M. Reichman - 51 Director Chief Operating Officer of Warburg
c/o 400 Bellevue Parkway Pincus Asset Management, Inc.,
Wilmington, DE 19809 Executive Officer and Director of
Counsellors Securities Inc. and
Director/Trustee of various
investment companies advised by
Warburg Pincus Asset Management,
Inc. until September 15, 1999; Prior
to 1997, Managing Director of
Warburg Pincus Asset Management,
Inc.
*Robert Sablowsky - 61 Director Executive Vice President of
Fahnestock & Company, Inc. Fahnestock Co., Inc. (a registered
125 Broad Street broker-dealer); Prior to October 1996,
New York, NY 10004 Executive Vice President of Gruntal
& Co., Inc. (a registered broker-
dealer).
Francis J. McKay - 64 Director Since 1963, Executive Vice President,
Fox Chase Cancer Center Fox Chase Cancer Center (biomedical
7701 Burholme Avenue research and medical care).
Philadelphia, PA 19111
*Marvin E. Sternberg - 65 Director Since 1974, Chairman, Director and
Moyco Technologies, Inc. President, Moyco Technologies, Inc.
200 Commerce Drive (manufacturer of dental supplies and
Montgomeryville, PA 18936 precision coated abrasives).
Julian A. Brodsky - 66 Director Director and Vice Chairman, since
1500 Market Street 1969 Comcast Corporation (cable
35th Floor television and communications);
Philadelphia, PA 19102 Director, Comcast U.K.
</TABLE>
-17-
<PAGE>
<TABLE>
<S> <C> <C>
Donald van Roden - 75 Director and Chairman of Self-employed businessman. From
1200 Old Mill Lane the Board February 1980 to March 1987, Vice
Wyomissing, PA 19610 Chairman, SmithKline Beecham
Corporation (pharmaceuticals);
Director AAA Mid-Atlantic (auto
service); Director, Keystone
Insurance Co.
Edward J. Roach - 75 President and Treasurer Certified Public Accountant; Vice
400 Bellevue Parkway Chairman of the Board, Fox Chase
Wilmington, DE 19809 Cancer Center; Trustee Emeritus,
Pennsylvania School for the Deaf;
Trustee Emeritus, Immaculata
College; President or Vice President
and Treasurer of various investment
companies advised by subsidiaries of
PNC Bank Corp. (1981 - 1997);
Treasurer of Chestnut Street
Exchange Fund; Vice President and
Treasurer of Independent Square
Income Securities, Inc.: Director of
the Bradford Funds, Inc.
Morgan R. Jones - 60 Secretary Chairman, the law firm of Drinker
Drinker Biddle & Reath LLP Biddle & Reath LLP; Director, Nobel
One Logan Square Education Dynamics, Inc.; Secretary,
18th & Cherry Streets Petrofenn, Inc.
Philadelphia, PA 19103
</TABLE>
* Each of Mr. Sablowsky and Mr. Sternberg is an "interested person" of RBB,
as that term is defined in the 1940 Act.
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,
$15,000 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 $19,250 N/A N/A
Francis J. McKay, Director $16,750 N/A N/A
Arnold M. Reichman, Director $ 0 N/A N/A
Robert Sablowsky, Director $18,250 N/A N/A
Marvin E. Sternberg, Director $19,250 N/A N/A
Donald van Roden, Director $25,250 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 November 17, 1999, 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 ADDRESS PERCENTAGE OF
FUND HELD
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
BEDFORD MUNICIPAL Gabe Nechamkin 7.40%
MONEY MARKET 27 Muchmore Road
Harrison, NY 10528-1109
- ------------------------------------------------------------------------------------------------
CASH PRESERVATION Harold T. Erfer 6.349%
MONEY MARKET 414 Charles Ln.
Wynnewood, PA 19096
- ------------------------------------------------------------------------------------------------
Marian E. Kunz 15.602%
52 Weiss Ave.
Flourtown, PA 19031
- ------------------------------------------------------------------------------------------------
Karen M. McElhinny and Contribution Account 8.227%
4943 King Arthur Dr.
Erie, PA 16506
- ------------------------------------------------------------------------------------------------
Luanne M. Garvey and Robert J. Garvey 15.438%
2729 Woodland Ave.
Trooper, PA 19403
- ------------------------------------------------------------------------------------------------
John Robert Estrada and Shirley Ann Estrada 5.260%
1700 Raton Dr.
Arlington, TX 76018
- ------------------------------------------------------------------------------------------------
Dominic and Barbara Pisciotta and Successors 12.785%
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 7.456%
1505 W. Cheyenne Dr.
Chandler, AZ 85224
- ------------------------------------------------------------------------------------------------
Anthony K. Bailey and 5.085%
Laura A. Bailey
5819 E. 35th Street
Tuscon AZ 85711
- ------------------------------------------------------------------------------------------------
SANSOM STREET Saxon and Co. 65.047%
MONEY MARKET FBO Paine Webber
A/C 32 32 400 4000038
P.O. Box 7780 1888
Phila., PA 19182
- ------------------------------------------------------------------------------------------------
Saxon and Co. 34.953%
c/o PNC Bank, N. A.
F3-F076-02-2
200 Stevens Drive Ste. 260/ACI
Lester, PA 19113
- ------------------------------------------------------------------------------------------------
</TABLE>
-19-
<PAGE>
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
CASH PRESERVATION Gary L. Lange 72.206%
MUNICIPAL MONEY MARKET and Susan D. Lange
JT TEN
837 Timber Glen Ln.
Ballwin, MO 63021-6066
- ------------------------------------------------------------------------------------------------
Mark Koehler and 5.800%
Suzanne Koehler
JT TEN WROS
3925 Bower St.
St. Louis, MO 63116
- ------------------------------------------------------------------------------------------------
RBB SELECT MONEY MARKET Warburg Pincus Capital Appreciation Fund 10.649%
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
Warburg Pincus Emerging Growth Fund 21.770%
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
Warburg Pincus Growth & Income Fund 6.831%
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
Warburg Pincus Trust Small Company Growth 12.161%
Portfolio
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
Warburg Pincus Trust-International Equity 15.203%
Portfolio
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
Warburg Pincus Japan Growth Fund 5.365%
Attn. Joe Gajewski / PFPC, Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
</TABLE>
-20-
<PAGE>
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
Warburg Pincus Institutional Fund 12.823%
Japan Small Company Fund
Attn: Joe Gajewski/PFPC Inc.
MS W3-F400-03-2
400 Bellevue Parkway
Wilmington, DE 19809
- ------------------------------------------------------------------------------------------------
Warburg Pincus Institutional Fund 6.290%
International Equity Portfolio
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 11.431%
Special Custody Account for the Exclusive
Benefit of Customers
Attn: Mutual Funds A/C 3143-0251
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
Gerald T. Reilly 11.249%
TRST RCAB Collective Investors Partnership
U/A DTD 9/19/95
2121 Commonwealth Avenue
Brighton, MA 02135
- ------------------------------------------------------------------------------------------------
Janis Claflin, Bruce Fetzer and 9.068%
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
- ------------------------------------------------------------------------------------------------
Public Inst. For Social Security 17.814%
1001 19th St., N. 16th Flr.
Arlington, VA 22209
- ------------------------------------------------------------------------------------------------
N/I GROWTH FUND Charles Schwab & Co. Inc 7.515%
Special Custody Account for the Exclusive
Benefit of Customers
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
</TABLE>
-21-
<PAGE>
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
Citibank North America Inc. 43.606%
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 6.333%
c/o Nancy Head
DTD. 01/04/91
1001 Fannin 4700
Houston, TX 77002
- ------------------------------------------------------------------------------------------------
U.S. Equity Investment Portfolio LP 7.965%
1001 N. US Hwy. One Suite 800
Jupiter, FL 33477
- ------------------------------------------------------------------------------------------------
N/I MID CAP FUND Charles Schwab & Co. Inc.
Special Custody Account for the Exclusive
Benefit of Customers
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
National Investors Services Corp. 7.177%
For the Exclusive Benefit of our Customers
S. 55 Water St. 32nd Floor
New York, NY 10041-3299
- ------------------------------------------------------------------------------------------------
N/I LARGER CAP FUND Charles Schwab & Co. Inc 57.838%
Special Custody Account for the Exclusive
Benefit of Customers
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
FTC & Co. 10.526%
Attn: Datalynx 241
Attn: Datalynx 273
P. O. Box 173736
Denver, CO 80217-3736
- ------------------------------------------------------------------------------------------------
N/I SMALL CAP VALUE FUND State Street Bank and Trust Company 54.161%
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
- ------------------------------------------------------------------------------------------------
</TABLE>
-22-
<PAGE>
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
Yale University 26.939%
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 5.631%
FUND INST SHARES 423 Fox Chapel Rd.
Pittsburgh, PA 15238
- ------------------------------------------------------------------------------------------------
Charles Schwab & Co., Inc. 7.311%
Special Custody Account for Bene. of Cust.
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
Swanee Hunt and Charles Ansbacher 17.122%
Trst.
The Hunt Alternatives Fund
c/o Elizabeth Alberti
168 Brattle St.
Cambridge, MA 02138
- ------------------------------------------------------------------------------------------------
Union Bank of California 9.643%
FBO Service Employees BP 610001265-01
P. O. Box 85484
San Diego, CA 92186
- ------------------------------------------------------------------------------------------------
US Bank National Association 17.536%
FBO A-Dec Inc. DOT 093098
Attn: Mutual Funds A/C 97307536
P. O. Box 64010
St. Paul, MN 55164-0010
- ------------------------------------------------------------------------------------------------
Northern Trust Company 16.644%
FBO AEFC Pension Trust
A/C 22-53582
P. O. Box 92956
Chicago, IL 60675
- ------------------------------------------------------------------------------------------------
James B. Beam 5.206%
Trst World Publishing Co. Pft Shr Trust
P.O. Box 1511
Wenatchee, WA 98807
- ------------------------------------------------------------------------------------------------
</TABLE>
-23-
<PAGE>
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS LARGE CAP Charles Schwab & Co. Inc. 66.397%
FUND INVESTOR SHARES Special Custody Account for Bene. of Cust.
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
Jupiter & Co. 6.380%
c/o Investors Bank
PO Box 9130 FPG90
Boston, MA 02110
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS MID CAP MAC & CO. 5.642%
VALUE FUND INST. SHARES A/C CHIF1001182
FBO Childrens Hospital LA
P.O. Box 3198
Pittsburgh, PA 15230-3198
- ------------------------------------------------------------------------------------------------
John M. Pontius, Jr. 6.234%
FBO Hartwick College
West Street
Queens, NY 13820
- ------------------------------------------------------------------------------------------------
MAC & CO. 7.976%
A/C LEMF5044062
Mutual Funds Operations
P.O. Box 3198
Pittsburgh, PA 15230-3198
- ------------------------------------------------------------------------------------------------
The Northern Trust Company 5.046%
FBO Thomas & Betts Master Retirement Trust
Attn: Ellen Shea
8155 T&B Blvd.
Memphis, TN 38123
- ------------------------------------------------------------------------------------------------
Norwest Bank Minnesota 5.194%
FBO McCormick & Co.
PEN-BOSTON A/C 12778825
P.O. Box 1533
Minneapolis, MN 55480
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS MID CAP National Financial Svcs. Corp. for Exclusive 17.061%
VALUE FUND INV SHARES Bene. of Our Customers
Sal Vella
200 Liberty St.
New York, NY 10281
- ------------------------------------------------------------------------------------------------
Charles Schwab & Co. Inc. 47.450%
Special Custody Account for Bene. of Cust.
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
</TABLE>
-24-
<PAGE>
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS BOND FUND Boston Partners Asset Mgmt. L. P. 26.464%
INSTITUTIONAL SHARES Attn: Jan Penney
28 State St.
Boston, MA 02109
- ------------------------------------------------------------------------------------------------
Chiles Foundation 8.499%
111 S.W. Fifth Ave.
Ste. 4050
Portland, OR 97204
- ------------------------------------------------------------------------------------------------
The Roman Catholic Diocese of 53.382%
Raleigh, NC
General Endowment
715 Nazareth St.
Raleigh, NC 27606
- ------------------------------------------------------------------------------------------------
The Roman Catholic Diocese of 11.654%
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 8.329%
MICRO CAP VALUE 41 Chestnut St.
FUND- INSTITUTIONAL Boston, MA 02108
SHARES
- ------------------------------------------------------------------------------------------------
Boston Partners Asset Mgmt. L. P. 65.889%
Attn: Jan Penney
28 State St.
Boston, MA 02109
- ------------------------------------------------------------------------------------------------
Wayne Archambo 6.622%
42 DeLopa Circle
Westwood, MA 02090
- ------------------------------------------------------------------------------------------------
</TABLE>
-25-
<PAGE>
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------
David M. Dabora 6.622%
11 White Plains Ct.
San Anselmo, CA 94960
- ------------------------------------------------------------------------------------------------
BOSTON PARTNERS National Financial Services Corp. 29.153%
MICRO CAP VALUE For the Exclusive Bene. of our Customers
FUND- INVESTOR Attn: Mutual Funds 5th Floor
SHARES 200 Liberty St.
1 World Financial Center
New York, NY 10281
- ------------------------------------------------------------------------------------------------
Charles Schwab & Co., Inc. 25.078%
Special Custody Account for Bene. of Cust.
Attn: Mutual Funds
101 Montgomery St.
San Francisco, CA 94104
- ------------------------------------------------------------------------------------------------
Scott J. Harrington 36.112%
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 6.690%
NEUTRAL FUND- INVESTOR Jt. Ten. Wros.
SHARES 156 Osgood St.
Andover, MA 01810
- ------------------------------------------------------------------------------------------------
Thomas Lannan and Kathleen Lannan 89.987%
Jt. Ten. Wros.
P. O. Box 312
Osterville, MA 02655
- ------------------------------------------------------------------------------------------------
SCHNEIDER SMALL CAP VALUE Arnold C. Schneider III 13.637%
FUND SEP IRA
826 Turnbridge Rd.
Wayne, PA 19087
- ------------------------------------------------------------------------------------------------
SCM Retirement Plan 5.466%
Profit Sharing Plan
460 E. Swedesford Rd. Ste. 1080
Wayne, PA 19087
- ------------------------------------------------------------------------------------------------
Ronald L. Gault 5.399%
IRA
439 W. Nelson St.
Lexington VA 24450
- ------------------------------------------------------------------------------------------------
John Frederick Lyness 12.964%
81 Hillcrest Ave.
Summit, NJ 07901
- ------------------------------------------------------------------------------------------------
</TABLE>
-26-
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
FUND NAME SHAREHOLDER NAME AND ADDRESS PERCENTAGE OF
FUND HELD
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
Mark Shevitz 7.206%
Rollover IRA
65 Wardell St.
Rumson, NJ 07760
- ------------------------------------------------------------------------------------------------
</TABLE>
As of November 17, 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 advisory fees
and/or reimburse expenses (other than brokerage commissions, extraordinary
items, interest and taxes) in excess of its advisory 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 and reimbursements
thereafter.
Until January 1, 2001, Numeric is entitled to a management fee of 0.75% of
the Fund's average daily net assets of the Growth, Mid Cap and Small Cap Value
Funds. Thereafter for the Growth, Mid Cap and Small Cap Value Funds, 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
4% or more 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 each of the Growth, Mid Cap and Small Cap
Value Funds' 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...................... 0.85% 0.50% 1.35%
+8% or more but less than +9%.... 0.85% 0.40% 1.25%
+7% or more but less than +8%.... 0.85% 0.30% 1.15%
</TABLE>
-27-
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
+6% or more but less than +7%.... 0.85% 0.20% 1.05%
+5% or more but less than +6%.... 0.85% 0.10% 0.95%
+4% or more but less than +5%.... 0.85% None 0.85%
+3% or more but less than +4%.... 0.85% -0.10% 0.75%
+2% or more but less than +3%.... 0.85% -0.20% 0.65%
+1% or more but less than +2%.... 0.85% -0.30% 0.55%
+0% or more but less than +1%.... 0.85% -0.40% 0.45%
Less than 0%..................... 0.85% -0.50% 0.35%
</TABLE>
From January 1, 2001 through December 31, 2001 Numeric has agreed to waive
its advisory fee and/or reimburse expenses (other than brokerage commissions,
extraordinary items, interest and taxes) in an aggregate amount equal to the
amount by which the Growth, Mid Cap and/or Small Cap Value Funds' total
operating expenses (other than investment advisory fees, brokerage commissions,
extraordinary items, interest and taxes) exceeds a total operating expense
ratio (other than investment advisory fees, brokerage commissions,
extraordinary items, interest and taxes) of 0.50% of such Fund's average daily
net assets.
For the fiscal years ended August 31, 1997, 1998 and 1999, the Funds paid
Numeric advisory fees and Numeric waived advisory fees and reimbursed expenses
in excess of its 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 $630,289 $125,805 $ 0
Growth $451,504 $121,919 $ 0
Mid Cap $488,857 $171,847 $ 0
Larger Cap Value $ 77,347 $ 73,497 $ 6,861
Small Cap Value* $ 931 $ 54,759 $14,836
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 $115,935 $ 10,081 $0
Growth $ 87,944 $ 7,646 $0
Mid Cap $103,317 $ 8,809 $0
Larger Cap Value $ 37,498 $ 37,501 $0
Small Cap Value* $ 28,123 $ 28,126 $0
(BSFM)
- -----
Micro Cap $ 50,406 $ 0 $0
Growth $ 38,228 $ 0 $0
Mid Cap $ 44,047 $ 0 $0
Larger Cap Value $ 10,056 $ 0 $0
Small Cap Value* $ 3,775 $ 0 $0
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 $20,163 $131,056 $0
Growth $15,292 $ 99,393 $0
Mid Cap $26,428 $105,713 $0
Larger Cap Value $ 6,034 $ 24,135 $0
Small Cap Value* $ 2,265 $ 9,059 $0
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 $140,589
Growth $ 75,767
Mid Cap $ 72,732
Larger Cap Value $ 17,107
Small Cap Value $ 5,230
</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 $16,350 $706,342 $568,754
Growth $27,840 $512,762 $395,555
Mid Cap $14,821 $508,568 $514,406
Larger Cap Value* $ N/A $ 45,723 $114,975
Small Cap Value** $ N/A $ N/A $ 58,795
</TABLE>
*The Larger Cap Value Fund commenced operations on December 9, 1997.
**The Small Cap Value Fund commenced operations on November 30, 1998.
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 Bear Stearns Companies Inc. (The) $187,312
Lehman Brothers Holdings Inc. 478,375
Larger Cap Value Bear Stearns Companies Inc. (The) $120,712
Lehman Brothers Holdings Inc. 123,625
Morgan Stanley, Dean Witter & Co. 34,325
</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
You may purchase shares through an account maintained by your brokerage
firm and you may also purchase shares directly by mail or wire. 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. A shareholder will
bear the risk of a decline in market value and any tax consequences associated
with a redemption in securities.
Under the 1940 Act, the Company may suspend the right to redemption or
postpone the date of payment upon redemption for any period during which the New
York Stock Exchange, Inc. (the "NYSE") is closed (other than customary weekend
and holiday closings), or during which the SEC restricts trading on the NYSE or
determines 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.
-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 $76,348,825 $62,375,823 $49,155,781 $8,255,991 $11,498,290
Outstanding shares $ 4,235,134 $ 4,190,064 $ 2,910,851 $ 622,361 $ 894,247
Net asset value per share $ 18.03 $ 14.89 $ 16.89 $ 13.27 $ 12.86
Maximum sales charge -- -- -- -- --
Maximum Offering Price to
Public $ 18.03 $ 14.89 $ 16.89 $ 13.27 $ 12.86
</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 returns for
the Funds were as follows:
<TABLE>
<CAPTION>
Fund Average Return
--------------------------------------------------------------------
<S> <C>
For August 31, 1999.
Micro Cap 21.97%
Growth 12.66%
Mid Cap 20.90%
Larger Cap Value 7.79%
Small Cap Value* N/A
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 Aggregate Return
------------------------------------------------------------------------
<S> <C>
For August 31, 1999.
Micro Cap 56.09%
Growth 52.80%
Mid Cap 41.61%
Larger Cap Value 26.01%
Small Cap Value* 7.17%
For August 31, 1998.
Micro Cap (20.74)%
Growth (29.03)%
Mid Cap (8.97)%
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 (2.75)%
Growth (1.33)%
Mid Cap (3.67)%
</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. PricewaterhouseCoopers LLP, 2400 Eleven Penn
Center, Philadelphia, Pennsylvania 19103, serves as RBB's independent
accountants. PricewaterhouseCoopers LLP performs an annual audit of the
Company's financial statements.
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' Annual
Report to Shareholders (the "1999 Annual Report") 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 Annual
Report are incorporated by reference herein. The financial statements included
in the 1999 Annual Report have been audited by RBB's independent accountants,
PricewaterhouseCoopers LLP. The reports of PricewaterhouseCoopers LLP 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 Annual Report may be
obtained free of charge by telephoning PFPC at (800) 348-5031.
-44-
<PAGE>
APPENDIX A
----------
Commercial Paper Ratings
- ------------------------
A Standard & Poor's commercial paper rating is a current opinion of
the creditworthiness of an obligor with respect to financial obligations having
an original maturity of no more than 365 days. The following summarizes the
rating categories used by Standard and Poor's for commercial paper:
"A-1" - Obligations are rated in the highest category indicating
that the obligor's capacity to meet its financial commitment on the obligation
is strong. Within this category, certain obligations are designated with a plus
sign (+). This indicates that the obligor's capacity to meet its financial
commitment on these obligations is extremely strong.
"A-2" - Obligations are somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than obligations in
higher rating categories. However, the obligor's capacity to meet its financial
commitment on the obligation is satisfactory.
"A-3" - Obligations exhibit 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.
"B" - Obligations are regarded as having significant speculative
characteristics. The obligor currently has the capacity to meet its financial
commitment on the obligation; however, it faces major ongoing uncertainties
which could lead to the obligor's inadequate capacity to meet its financial
commitment on the obligation.
"C" - Obligations are currently vulnerable to nonpayment and are
dependent upon favorable business, financial, and economic conditions for the
obligor to meet its financial commitment on the obligation.
"D" - Obligations are 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 will be used
upon the filing of a bankruptcy petition or the taking of a similar action if
payments on an obligation are jeopardized.
Moody's commercial paper ratings are opinions of the ability of
issuers to repay punctually senior debt obligations not having an original
maturity in excess of one year, unless explicitly noted. The following
summarizes the rating categories used by Moody's for commercial paper:
A-1
<PAGE>
"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.
"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.
A-2
<PAGE>
"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 best 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.
"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."
A-3
<PAGE>
"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 obligation. Adverse business, financial or economic
conditions will likely impair the obligor's capacity or willingness to meet its
financial commitment on the obligation.
A-4
<PAGE>
"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.
"c" - The 'c' subscript is used to provide additional information to
investors that the bank may terminate its obligation to purchase tendered bonds
if the long-term credit rating of the issuer is below an investment-grade level
and/or the issuer's bonds are deemed taxable.
"p" - The letter 'p' indicates that the rating is provisional. A
provisional rating assumes the successful completion of the project financed by
the debt being rated and indicates that payment of debt service requirements is
largely or entirely dependent upon the successful, timely completion of the
project. This rating, however, while addressing credit quality subsequent to
completion of the project, makes no comment on the likelihood of or the risk of
default upon failure of such completion. The investor should exercise his own
judgment with respect to such likelihood and risk.
* Continuance of the ratings is contingent upon Standard & Poor's
receipt of an executed copy of the escrow agreement or closing documentation
confirming investments and cash flows.
"r" - The 'r' highlights derivative, hybrid, and certain other
obligations that Standard & Poor's believes may experience high volatility or
high variability in expected returns as a result of noncredit risks. Examples of
such obligations are securities with principal or interest return indexed to
equities, commodities, or currencies; certain swaps and options; and
interest-only and principal-only mortgage securities. The absence of an 'r'
symbol should not be taken as an indication that an obligation will exhibit no
volatility or variability in total return.
N.R. Not rated. Debt obligations of issuers outside the United
States and its
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territories are rated on the same basis as domestic corporate and municipal
issues. The ratings measure the creditworthiness of the obligor but do not take
into account currency exchange and related uncertainties.
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 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" indicates 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
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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. This is the
lowest investment grade category.
"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 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
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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. This is the lowest
investment grade category.
"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" and "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, 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 denote relative standing within these major
rating categories.
'NR' indicates the Fitch IBCA does not rate the issuer or issue in
question.
'Withdrawn': A rating is withdrawn when Fitch IBCA deems the amount
of information available to be inadequate for rating purposes, or when an
obligation matures, is
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called, or refinanced.
RatingAlert: Ratings are placed on RatingAlert to notify investors
that there is a reasonable probability of a rating change and the likely
direction of such change. These are designated as "Positive," indicating a
potential upgrade, "Negative," for a potential downgrade, or "Evolving," if
ratings may be raised, lowered or maintained. RatingAlert is typically resolved
over a relatively short period.
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 repayment of principal and interest. "BB" indicates the lowest degree of
speculation and "CC" the highest degree of speculation.
"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 note rating reflects the liquidity factors and
market access
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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. Margins of
protection 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.
"SG" - This designation denotes speculative quality. Debt
instruments in this category lack 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
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(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
(26) Articles Supplementary of Registrant. 36
(b) (1) By-Laws, as amended. 22
(c) (1) See Articles VI, VII, VIII, IX and XI of Registrant's Articles
of Incorporation dated February 17, 1988. 1
(2) See Articles II, III, VI, XIII and XIV of Registrant's By-Laws as
amended through April 26, 1996. 17
(d) (1) Investment Advisory Agreement (Money Market) between
Registrant and Provident Institutional Management Corporation, dated as
of August 16, 1988. 3
(2) Sub-Advisory Agreement (Money Market) between
Provident Institutional Management Corporation and Provident National
Bank, dated as of August 16, 1988. 3
(3) Assumption Agreement (Money Market Fund) between PNC
Bank, N.A. and BlackRock Institutional Management Corporation (formerly
PNC Institutional Management Corporation) dated April 29, 1998. 34
(4) Investment Advisory Agreement (Tax-Free Money Market)
between Registrant and Provident Institutional Management Corporation,
dated as of August 16, 1988. 3
(5) Sub-Advisory Agreement (Tax-Free Money Market) between
Provident Institutional Management Corporation and Provident National
Bank, dated as of August 16, 1988. 3
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(6) Assumption Agreement (Municipal Money Market Fund)
between PNC Bank, N.A. and BlackRock Institutional Management
Corporation (formerly PNC Institutional Management Corporation) dated
April 29, 1998. 34
(7) Investment Advisory Agreement (Government Obligations
Money Market) between Registrant and Provident Institutional Management
Corporation, dated as of August 16, 1988. 3
(8) Sub-Advisory Agreement (Government Obligations Money
Market) between Provident Institutional Management Corporation and
Provident National Bank, dated as of August 16, 1988. 3
(9) Assumption Agreement (Government Obligations Money Market Fund) between
PNC Bank, N.A. and BlackRock Institutional Management Corporation
(formerly PNC Institutional Management Corporation) dated April 29,
1998. 34
(10) Investment Advisory Agreement (Government Securities) between
Registrant and Provident Institutional Management Corporation dated as
of April 8, 1991. 8
(11) Investment Advisory Agreement (New York Municipal Money Market) between
Registrant and Provident Institutional Management Corporation dated
November 5, 1991. 9
(12) Investment Advisory Agreement (Tax-Free Money Market) between
Registrant and Provident Institutional Management Corporation dated
April 21, 1992. 10
(13) Investment Advisory Agreement (n/i Micro Cap Fund) between Registrant
and Numeric Investors, L.P. 17
(14) Investment Advisory Agreement (n/i Growth Fund) between Registrant and
Numeric Investors, L.P. 17
(15) Investment Advisory Agreement (n/i Growth & Value Fund) between
Registrant and Numeric Investors, L.P. 17
(16) Investment Advisory Agreement (Boston Partners Large Cap Value Fund)
between Registrant and Boston Partners Asset Management, L.P. 20
(17) Investment Advisory Agreement (Boston Partners Mid Cap Value Fund)
between Registrant and Boston Partners Asset Management, L.P. 22
(18) Investment Advisory Agreement (n/i Larger Cap Value Fund) between
Registrant and Numeric Investors, L.P. dated December 1, 1997. 24
(19) Investment Advisory Agreement (Boston Partners Bond Fund) between
Registrant and Boston Partners Asset Management, L.P. dated December 1,
1997. 24
(20) Investment Advisory Agreement (Schneider Small Cap Value Fund) between
Registrant and Schneider Capital Management Company. 29
(21) Investment Advisory Agreement (Boston Partners Micro Cap Value Fund)
between Registrant and Boston Partners Asset Management, L.P. 29
(22) Investment Advisory Agreement (Boston Partners Market Neutral Fund)
between Registrant and Boston Partners Asset Management, L.P. 31
(23) Investment Advisory Agreement (n/i Small Cap Value Fund) between
Registrant and Numeric Investors, L.P. 31
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(24) Form of Investment Advisory Agreement (Boston Partners Long-
Short Equity Fund) between Registrant and Boston Partners Asset
Management, L. P. 32
(25) Investment Advisory Agreement (Bogle Small Cap Growth Fund)
between Registrant and Bogle Investment Management, L. P. 34
(e) (1) Distribution Agreement between Registrant and Provident
Distributors, Inc. dated as of June 25, 1999. 34
(2) Distribution Agreement Supplement between Registrant and
Provident Distributors, Inc. (Bogle Small Cap Growth Fund-
Institutional Class and Investor Class) 34
(f) Fund Office Retirement Profit-Sharing and Trust Agreement, dated as
of October 24, 1990, as amended. 23
(g) (1) Custodian Agreement between Registrant and Provident National
Bank dated as of August 16, 1988. 3
(2) Sub-Custodian Agreement among The Chase Manhattan Bank, N.A., the
Registrant and Provident National Bank, dated as of July 13, 1992,
relating to custody of Registrant's foreign securities. 10
(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 n/i Micro Cap Fund, n/i Growth Fund and n/i Growth & Value
Fund Portfolios of the Registrant. 17
(6) Custodian Agreement Supplement between Registrant and PNC Bank,
National Association dated October 16, 1996. 20
(7) Custodian Agreement Supplement between Registrant and PNC Bank,
National Association, on behalf of the Boston Partners Mid Cap Value
Fund. 22
(8) Custody Agreement between Registrant and Custodial Trust Company on
behalf of the n/i Larger Cap Value Fund. 24
(9) Custodian Agreement Supplement between Registrant and PNC Bank, N.A. on
behalf of the Boston Partners Bond Fund. 24
(10) Custodian Agreement Supplement between Registrant and PNC Bank, N.A. on
behalf of the Schneider Small Cap Value Fund. 29
(11) Custodian Agreement Supplement between Registrant and PNC Bank, N.A. on
behalf of the Boston Partners Micro Cap Value Fund. 29
(12) Custodian Agreement Supplement between Registrant and PNC Bank, N.A. on
behalf of Boston Partners Market Neutral Fund. 31
(13) Custodian Agreement Supplement between Registrant and Custodial Trust
Company on behalf of n/i Small Cap Value Fund. 31
(14) Form of Custodian Agreement Supplement between
Registrant and PFPC Trust Company (Boston Partners Long-Short Equity
Fund) 32
(15) Custodian Agreement Supplement between Registrant and
PFPC Trust Company (Bogle Small Cap Growth Fund) 34
(h) (1) Transfer Agency Agreement (Sansom Street) between Registrant
and Provident Financial Processing Corporation, dated as of August 16,
1988. 3
(2) Transfer Agency Agreement (Cash Preservation) between Registrant and
Provident Financial Processing Corporation, dated as of August 16, 1988. 3
(3) Shareholder Servicing Agreement (Sansom Street Money Market). 3
</TABLE>
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(4) Shareholder Servicing Agreement (Sansom Street Tax-Free Money Market). 3
(5) Shareholder Servicing Agreement (Sansom Street Government Obligations
Money Market). 3
(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 Processing Corporation, dated as of August 16, 1988. 3
(10) Administration and Accounting Services Agreement between Registrant and
Provident Financial Processing Corporation, relating to Government
Securities Portfolio, dated as of April 10, 1991. 8
(11) Administration and Accounting Services Agreement between Registrant and
Provident Financial Processing Corporation, relating to New York
Municipal Money Market Portfolio dated as of November 5, 1991. 9
(12) Transfer Agency Agreement and Supplements (Bradford, Alpha (now known
as Janney), Beta, Gamma, Delta, Epsilon, Zeta, Eta and Theta) between
Registrant and Provident Financial Processing Corporation dated as of
November 5, 1991. 9
(13) Administration and Accounting Services Agreement between Registrant and
Provident Financial Processing Corporation, relating to Tax-Free Money
Market Portfolio, dated as of April 21, 1992. 10
(14) Transfer Agency and Service Agreement between Registrant and State
Street Bank and Trust Company and PFPC Inc. dated February 1, 1995. 15
(15) Supplement to Transfer Agency and Service Agreement
between Registrant, State Street Bank and Trust Company, Inc.
and PFPC Inc. dated April 10, 1995. 15
(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 n/i Growth & Value Fund) between Registrant and PFPC Inc.
dated April 14, 1996. 17
(18) Administration and Accounting Services Agreement between Registrant and
PFPC Inc. (n/i Micro Cap Fund) dated April 24, 1996. 17
(19) Administration and Accounting Services Agreement between Registrant and
PFPC Inc. (n/i Growth Fund) dated April 24, 1996. 17
(20) Administration and Accounting Services Agreement between Registrant and
PFPC Inc. (n/i Growth & Value Fund) dated April 24, 1996. 17
(21) Transfer Agreement and Service Agreement between Registrant and State
Street Bank and Trust Company. 18
(22) Administration and Accounting Services Agreement between the Registrant
and PFPC Inc. dated October 16, 1996 (Boston Partners Large Cap Value
Fund). 21
(23) Transfer Agency Agreement Supplement between Registrant and PFPC Inc.
(Boston Partners Large Cap Value Fund, Institutional Class). 20
(24) Transfer Agency Agreement Supplement between Registrant and PFPC Inc.
(Boston Partners Large Cap Value Fund, Investor Class). 20
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(25) Transfer Agency Agreement Supplement between Registrant and PFPC Inc.
(Boston Partners Large Cap Value Fund, Advisor Class). 20
(26) Transfer Agency Agreement Supplement between Registrant and PFPC Inc.
(Boston Partners Mid Cap Value Fund, Institutional Class). 22
(27) Transfer Agency Agreement Supplement between Registrant and PFPC Inc.
(Boston Partners Mid Cap Value Fund, Investor Class). 22
(28) Administration and Accounting Services Agreement between Registrant and
PFPC Inc. dated, May 30, 1997 (Boston Partners Mid Cap Value Fund). 22
(29) Transfer Agency Agreement Supplement (n/i Larger Cap Value Fund)
between Registrant and PFPC Inc. dated December 1, 1997. 24
(30) Administration and Accounting Services Agreement between Registrant and
PFPC Inc. dated December 1, 1997 (n/i Larger Cap Value Fund). 24
(31) Co-Administration Agreement between Registrant and Bear Stearns Funds
Management, Inc. dated December 1, 1997 (n/i Larger Cap Value Fund). 24
(32) Transfer Agency Agreement Supplement between Registrant and PFPC Inc.
dated December 1, 1997 (Boston Partners Bond Fund, Institutional Class). 24
(33) Transfer Agency Agreement Supplement between Registrant and PFPC Inc.
dated December 1, 1997 (Boston Partners Bond Fund, Investor Class). 24
(34) Administration and Accounting Services Agreement between Registrant and
PFPC Inc. dated December 1, 1997 (Boston Partners Bond Fund). 24
(35) Administration and Accounting Services Agreement between Registrant and
PFPC Inc. (Schneider Small Cap Value Fund). 29
(36) Transfer Agency Agreement Supplement between Registrant and PFPC Inc.
(Schneider Small Cap Value Fund). 29
(37) Transfer Agency Agreement Supplement between Registrant and PFPC Inc.
(Boston Partners Micro Cap Value Fund, Institutional Class). 29
(38) Transfer Agency Agreement Supplement between Registrant and PFPC Inc.
(Boston Partners Micro Cap Value Fund, Investor Class). 29
(39) Administration and Accounting Services Agreement between Registrant and
PFPC Inc. (Boston Partners Micro Cap Value Fund). 29
(40) Administrative Services Agreement between Registrant and Provident
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. 26
(41) Administrative Services Agreement Supplement between Registrant and
Provident Distributors, Inc. relating to the Boston Partners Market
Neutral Fund (Institutional Class). 31
(42) Administrative and Accounting Services Agreement between Registrant and
PFPC Inc. (Boston Partners Market Neutral Fund - Institutional and
Investor Classes). 31
(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. 31
(n/i Small Cap Value Fund).
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(45) Administration and Accounting Services Agreement between Registrant and
PFPC Inc. (n/i Small Cap Value Fund). 31
(46) Co-Administration Agreement between Registrant and Bear Stearns Funds
Management, Inc. (n/i Small Cap Value Fund). 31
(47) Administrative Services Agreement between Registrant and Provident
Distributors, Inc. (n/i Small Cap Value Fund). 31
(48) Form of Transfer Agency Agreement Supplement between Registrant and
PFPC Inc. (Boston Partners Long-Short Equity Fund). 32
(49) Form of Administrative Services Agreement Supplement between
Registrant and Provident Distributors, Inc. (Boston Partners Long-
Short Equity Fund- Institutional Shares). 32
(50) Form of Administration and Accounting Services Agreement between
Registrant and PFPC Inc. (Boston Partners Long-Short Equity Fund). 32
(51) Transfer Agency Agreement Supplement between Registrant and
PFPC Inc. (Bogle Small Cap Growth Fund). 34
(52) Administrative Services Agreement between Registrant and
Provident Distributors, Inc. (Bogle Small Cap Growth Fund). 34
(53) Non 12b-1 Shareholder Services Plan and Agreement for Bogle
Small Cap Growth (Investor Shares.) 34
(54) Agreement between E*TRADE Group, Inc., Registrant and Registrant's
principal underwriter. 36
(55) Fee Waiver Agreement for n/i Numeric Small Cap Growth Fund. 36
(56) Administration and Accounting Services Agreement between Registrant
and PFPC Inc. (Bogle Investment Management Small Cap Growth Fund). 36
(57) Solicitation Agreement between n/i Numeric Investors and
Shareholder Communications Corporation. Registrant and Registrant's
principal underwriter. 36
(i) (1) Opinion of Drinker Biddle & Reath LLP. 36
(j) (1) Consent of Drinker Biddle & Reath LLP. 36
(2) Consent of Independent Auditor. 36
(k) None.
(l) (1) Subscription Agreement (relating to Classes A through N). 2
(2) Subscription Agreement between Registrant and Planco Financial
Services, Inc., relating to Classes O and P. 7
(3) Subscription Agreement between Registrant and Planco Financial
Services, Inc., relating to Class Q. 7
(4) Subscription Agreement between Registrant and Counsellors Securities
Inc. relating to Classes R, S, and Alpha 1 through Theta 4. 9
(5) Purchase Agreement between Registrant and Numeric Investors, L.P.
relating to Class FF (n/i Micro Cap Fund). 17
(6) Purchase Agreement between Registrant and Numeric Investors, L.P.
relating to Class GG (n/i Growth Fund). 17
(7) Purchase Agreement between Registrant and Numeric Investors, L.P.
relating to Class HH (n/i Growth & Value Fund). 17
(8) Purchase Agreement between Registrant and Boston Partners Asset
Management, L.P. relating to Classes QQ, RR and SS (Boston Partners
Large Cap Value Fund). 21
(9) Purchase Agreement between Registrant and Boston Partners Asset
Management, L.P. relating to Classes TT and UU (Boston Partners Mid Cap
Value Fund). 22
</TABLE>
-6-
<PAGE>
<TABLE>
<CAPTION>
SEE NOTE #
----------
<S> <C>
(10) Purchase Agreement between Registrant and Boston Partners Asset
Management L.P. relating to Classes VV and WW (Boston Partners Bond
Fund). 24
(11) Purchase Agreement between Registrant and Numeric Investors, L.P.
relating to Class XX (n/i Larger Cap Value Fund). 24
(12) Purchase Agreement between Registrant and Schneider Capital Management
Company relating to Class YY (Schneider Small Cap Value Fund). 29
(13) Purchase Agreement between Registrant and Boston Partners Asset
Management, L.P. relating to Classes DDD and EEE (Boston Partners Micro
Cap Value Fund). 29
(14) Purchase Agreement between Registrant and Boston Partners Asset
Management relating to Classes III and JJJ (Boston Partners Market
Neutral Fund). 31
(15) Purchase Agreement between Registrant and Provident Distributors, Inc.
relating to Class MMM (n/i Small Cap Value Fund). 31
(16) Form of Purchase Agreement between Registrant and Boston Partners
Asset Management, L. P. relating to Classes KKK and LLL (Boston
Partners Long-Short Equity Fund). 32
(17) Purchase Agreement between Registrant and Bogle Investment Management,
L. P. (Bogle Small Cap Growth Fund) 34
(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 known as the Municipal Money Market)). 9
(13) Plan of Distribution (Alpha (now known as Janney) Government
Obligations Money Market). 9
(14) Plan of Distribution (Alpha (now known as Janney) New York Municipal
Money Market). 9
(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
</TABLE>
-7-
<PAGE>
<TABLE>
<CAPTION>
SEE NOTE #
----------
<S> <C>
(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
(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 21
Class).
(42) Plan of Distribution (Boston Partners Large Cap Value Fund - Advisor 21
Class).
(43) Plan of Distribution (Boston Partners Mid Cap Value Fund - Investor 21
Class).
(44) Plan of Distribution (Boston Partners Bond Fund - Investor Class). 24
(45) Plan of Distribution (Boston Partners Micro Cap Value Fund - Investor 25
Class).
(46) Amendment to Plans of Distribution pursuant to Rule 12b-1. 31
(47) Plan of Distribution (Boston Partners Market Neutral Fund - Investor 30
Class).
(48) Plan of Distribution (Principal Money Market). 29
(49) Form of Plan of Distribution (Boston Partners Long-Short 32
Equity Fund - Investor Class).
(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.
-8-
<PAGE>
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.
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.
-9-
<PAGE>
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.
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 Incorporated herein by reference to Post-Effective Amendment No. 67 to the
Registrant's Registration Statement (33-20827) filed on July 2, 1999.
35. Incorporated herein by reference to Post-Effective Amendment No. 68 to the
Registrant's Registration Statement (33-20827) filed on July 2, 1999.
36. 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.
Section 4(b) of the Retail Shareholder Services Agreement among E*TRADE,
the RBB Fund Fund, Inc. and Provident Distributors, Inc. provides as
follows:
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 to this
agreement shall be liable for any special, consequential or incidental
damages.
<PAGE>
Item 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
Set forth below are the names and principal businesses of the
directors and certain of the senior executive officers of BIMC, who are or have
been engaged in any other business, profession, vocation or employment of a
substantial nature.
Position with Other Business Type of
BIMC Name Connection Business
---- ---- ----------- --------
Managing Director, Robert Peter NEF Broker/Dealer
General Council & Connolly Corporation & Transfer Agent
Sec. Boston, Ma
Set forth below are the names and principal businesses of the
directors and certain of the senior executive officers of Numeric Investors L.P.
who are or have been engaged in any other business, profession, vocation or
employment of a substantial nature.
Position with Other Business Type of
Numeric Investors L.P. Name Connection Business
- ---------------------- ---- ----------- --------
President, Treasurer Langdon Blecker Langdon Wheeler & General
Secretary & Manager Wheeler Associates, Inc., Partner
One Memorial Dr.
Cambridge, MA
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
Position with Bogle
Investment Management, Other Business
Name L.P. Connections Type of Business
---- ---- ----------- ----------------
John Bogle, Jr. President Managing Director, Investment
Numeric Investors, Management
L.P.
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/her own account or in the capacity of director,
officer, employee, partner or trustee.
PNC Bank, National Association
Directors
<TABLE>
<CAPTION>
Position with
PNC Bank Name Other Business Connections Type of Business
- -------- ---- -------------------------- ----------------
<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
Consolidated Natural Gas Company 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
PNC Bank Name Other Business Connections Type of Business
- -------- ---- -------------------------- ----------------
<S> <C> <C> <C>
Director Walter E. Gregg, Jr. Vice Chairman Diversified Financial
PNC Bank Corp. Services
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
PNC Bank Corp. Services
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
Cinergy Corp. Company
221 East Fourth Street, Suite 3004
Cincinnati, OH 45202
Director James E. Rohr President & Chief Operating Officer Diversified Financial
PNC Bank Corp. Services
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
PNC Bank Name Other Business Connections Type of Business
- -------- ---- -------------------------- ----------------
<S> <C> <C> <C>
Director Richard P. Simmons Chairman 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
USX Corporation Diversified Business
61/st/ 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
Advisory Director Helge H. Wehmeier President and Chief Executive Officer Specialty Chemicals,
Bayer Corporation Pharmaceuticals, Imaging and
100 Bayer Road, Building 4 Graphics Systems
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 Finance 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 One PNC Plaza P1-POPP-29-1
Community Bank 249 Fifth Avenue
Pittsburgh, PA 15222-2707
Thomas K. Whitford Executive Vice President, PNC Advisors One PNC Plaza P1-POPP-29-1
249 Fifth Avenue
Pittsburgh, PA 15222-2707
Robert L. Haunschild Senior Vice 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) PDI currently acts as principal underwriter for, in addition to
the Registrant, the following investment companies:
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.
GAMNA Series Funds, Inc.
WT Investment Trust
Kalmar Pooled Investment Trust
The RBB Fund, Inc.
Robertson Stephens Investment Trust
HT Insight Funds Trust
-15-
<PAGE>
Hilliard-Lyons Government Fund, Inc.
Hilliard-Lyons Growth Fund, Inc.
Hilliard-Lyons Research Trust
The BlackRock Funds, Inc. (Distributed by BlackRock
Distributors, Inc. a wholly owned subsidiary of Provident
Distributors, Inc.)
Northern Funds Trust (Distributed by Northern Funds
Distributors, LLC 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.)
(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, 6/th/
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, 18/th/ and Cherry
Streets, Philadelphia, 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
certifies that it meets all of the requirements for effectiveness of this Post-
Effective Amendment No. 69 to the Registration Statement pursuant to Rule
485(b) under the Securities Act of 1933, as amended, and registrant has duly
caused this Post-Effective Amendment No. 69 to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Wilmington, and State of
Delaware, on the 29th day of November, 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>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Edward J. Roach President (Principal Executive November 29, 1999
----------------------------
Edward J. Roach Officer) and Treasurer (Principal
Financial and Accounting Officer)
*Donald van Roden Director November 29, 1999
----------------------------
Donald van Roden
*Francis J. McKay Director November 29, 1999
----------------------------
Francis J. McKay
*Marvin E. Sternberg Director November 29, 1999
----------------------------
Marvin E. Sternberg
*Julian A. Brodsky Director November 29, 1999
----------------------------
Julian A. Brodsky
*Arnold M. Reichman Director November 29, 1999
----------------------------
Arnold M. Reichman
*Robert Sablowsky Director November 29, 1999
----------------------------
Robert Sablowsky
*By: /s/ Edward J. Roach November 29, 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, 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.
(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, 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, 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, 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, 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, Edward J. Roach,
hereby constitutes and appoints Michael P. Malloy, his true and lawful attorney,
to execute in his name, place, and stead, in his capacity as an officer 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 attorney 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 attorney being hereby ratified and approved.
DATED: April 23, 1997
/s/ Edward J. Roach
- -------------------------
Edward J. Roach
<PAGE>
THE RBB FUND, INC.
EXHIBIT INDEX
-------------
<TABLE>
<CAPTION>
Exhibits
--------
<S> <C>
(a) (26) Articles Supplementary dated February 16, 1999.
(h) (54) Agreement between E-TRADE Group, Inc., Registrant and
Registrant's Principal Underwriter dated October 1, 1999.
(55) Fee Waiver Agreement for n/i Numeric Small Cap Growth Fund
dated October 13, 1999.
(56) Administration and Accounting Services Agreement between
Registrant and PFPC, Inc. (Bogle Investment Management
Small Cap Growth Fund) dated September 15, 1999.
(57) Solicitation Agreement between n/i Numeric Investors and
Shareholder Communications Corporation.
(i) (1) Opinion of Drinker Biddle & Reath LLP.
(j) (1) Consent of Drinker Biddle & Reath LLP.
(2) Consent of Independent Accountants.
</TABLE>
1
<PAGE>
EXHIBIT (a)(26)
THE RBB FUND, INC.
ARTICLES SUPPLEMENTARY TO THE
CHARTER
THE RBB FUND, INC., a Maryland corporation having its principal office
in Baltimore, Maryland (hereinafter called the "Corporation"), hereby certifies
to the State Department of Assessments and Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation, an open-end
investment company registered under the Investment Company Act of 1940, as
amended, and having authorized capital of thirty billion (30,000,000,000) shares
of common stock, par value $.001 per share, has adopted a unanimous resolution
increasing the number of shares of common stock that are classified (but not
increasing the aggregate number of authorized shares) into separate classes by:
classifying an additional one billion five hundred million (1,500,000,000)
of the previously authorized, unissued and unclassified shares of the
common stock, par value $.001 per share, as Class Janney Money Shares, for
a total of 3,000,000,000 Class Janney Money Shares with an aggregate par
value of three million dollars ($3,000,000) (Janney Class of the Money
Market Portfolio);
SECOND: A description of the shares so classified with the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications and terms and conditions of
redemption as set or changed by the Board of Directors of the Corporation is as
follows:
A description of the preferences, conversion and other rights, voting
powers, restrictions, limitations as to dividends, qualifications and terms and
conditions or redemption of each class of common stock of the Corporation is set
forth in Article VI, Section (6) of the Corporation's Charter, and has not been
changed by the Board of Directors of the Corporation.
The shares of Class Janney Money Common Stock will be issued without
stock certificates.
The shares of Class Janney Money Common Stock and previously
classified Classes E, G, I, L, Select, Principal Class Money, Delta 1, Epsilon
1, Zeta 1, Eta 1 and Theta 1 Common Stock shall be invested in a common
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:
<PAGE>
(a) the Corporation had authority to issue thirty billion
(30,000,000,000) shares of its common stock and the aggregate par value of all
the shares of all classes was thirty million dollars ($30,000,000);
(b) the number of shares of each authorized class of common stock
was as follows:
Class A - one hundred million (100,000,000), par value $.001 per share;
Class B - one hundred million (100,000,000), par value $.001 per share;
Class C - one hundred million (100,000,000), par value $.001 per share;
Class D - one hundred million (100,000,000), par value $.001 per share;
Class E - five hundred million (500,000,000), par value $.001 per share;
Class F - five hundred million (500,000,000), par value $.001 per share;
Class G - five hundred million (500,000,000), par value $.001 per share;
Class H - five hundred million (500,000,000), par value $.001 per share;
Class I - one billion five hundred (1,500,000,000), par value $.001 per
share;
Class J - five hundred million (500,000,000), par value 66$.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;
-2-
<PAGE>
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;
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;
-3-
<PAGE>
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;
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;
-4-
<PAGE>
Class MMM - one hundred million (100,000,000), par value $.001
Class Janney Money - one billion five hundred million (1,500,000,000), par
value $.001 per share;
Class Janney - two hundred million (200,000,000), par value $.001 per
Municipal Money share;
Class Janney - seven hundred million (700,000,000), par value $.001
Government Money per share;
Class Janney - one hundred million (100,000,000), par value $.001 per
N.Y. Municipal 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;
Class Principal - seven hundred million (700,000,000), par value $.001
Money 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;
-5-
<PAGE>
Class Epsilon 4 - one million (1,000,000), par value $.001 per share;
Class Zeta 1 - one million (1,000,000), par value $.001 per share;
Class Zeta 2 - one million (1,000,000), par value $.001 per share;
Class Zeta 3 - one million (1,000,000), par value $.001 per share;
Class Zeta 4 - one million (1,000,000), par value $.001 per share;
Class Eta 1 - one million (1,000,000), par value $.001 per share;
Class Eta 2 - one million (1,000,000), par value $.001 per share;
Class Eta 3 - one million (1,000,000), par value $.001 per share;
Class Eta 4 - one million (1,000,000), par value $.001 per share;
Class Theta 1 - one million (1,000,000), par value $.001 per share;
Class Theta 2 - one million (1,000,000), par value $.001 per share;
Class Theta 3 - one million (1,000,000), par value $.001 per share;
Class Theta 4 - one million (1,000,000), par value $.001 per share;
for a total of eighteen billion three hundred twenty-six million
(18,326,000,000) 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;
-6-
<PAGE>
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 (1,500,000,000), par value $.001
per share;
Class J - five hundred million (500,000,000), par value 66$.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;
-7-
<PAGE>
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;
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;
-8-
<PAGE>
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;
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
Municipal Money - two hundred million (200,000,000), par value $.001 per
share;
Class Janney
Government Money - seven hundred million (700,000,000), par value $.001 per
share;
Class Janney
N.Y. Municipal
Money - one hundred million (100,000,000), par value $.001 per
share;
Class Select - seven hundred million (700,000,000), par value $.001 per
share;
-9-
<PAGE>
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 - seven hundred million (700,000,000), par value $.001
Money 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;
-10-
<PAGE>
Class Eta 4 - one million (1,000,000), par value $.001 per share;
Class Theta 1 - one million (1,000,000), par value $.001 per share;
Class Theta 2 - one million (1,000,000), par value $.001 per share;
Class Theta 3 - one million (1,000,000), par value $.001 per share;
Class Theta 4 - one million (1,000,000), par value $.001 per share;
for a total of nineteen billion eight hundred twenty-six million
(19,826,000,000) 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 February 16, 1999.
THE RBB FUND, INC.
WITNESS:
/s/ Michael P. Malloy /s/ Edward J. Roach
- -------------------------------- --------------------------
Michael P. Malloy Edward J. Roach
Assistant Secretary President
-11-
<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
-12-
<PAGE>
EXHIBIT (h)(54)
E*TRADE Group, Inc.
No Transaction Fee Mutual Fund Offering
RETAIL SHAREHOLDER SERVICES AGREEMENT
This Agreement is made as of October 1, 1999, 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: /s/ Edward J. Roach By: /s/ Philip H. Rinnander
----------------------------- --------------------------------
Name: Edward J. Roach Name: Philip H. Rinnander
-------------------------- -------------------------------
Title: President and Treasurer Title: President
------------------------- -----------------------------
Date: September 22, 1999 Date: October 5, 1999
--------------------------- ------------------------------
BOSTON PARTNERS By: /s/ Brian Murray
---------------------------------
ASSET MANAGEMENT, L.P. E*TRADE Group, Inc.
By: BOSTON PARTNERS, INC.
its General Partner
By: /s/ William J. Kelly
-------------------------
Title: Treasurer
-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: /s/ Edward J. Roach By: /s/ Philip H. Rinnander
----------------------------------- --------------------------
Name: Edward J. Roach Name: Philip H. Rinnander
--------------------------------- -----------------------
Title: President and Treasurer Title: President
-------------------------------- -----------------------
Date: September 22, 1999 Date: October 22, 1999
-------------------------------- -----------------------
BOSTON PARTNERS By: /s/ Brian Murray
--------------------------
ASSET MANAGEMENT, L.P. E*TRADE Group, Inc.
By: BOSTON PARTNERS, INC. Date: October 5, 1999
------------------------
its General Partner
288 State Street
Boston, MA 02109
By: /s/ William J. Kelly
----------------------------------
Name: William J. Kelly
--------------------------------
Title: Treasurer
-------------------------------
Date: September 30, 1999
--------------------------------
<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: /s/ Edward J. Roach By: /s/ Philip H. Rinnander
------------------------------ -------------------------------
Name: Edward J. Roach Name: Philip H. Rinnander
---------------------------- -----------------------------
Title: President and Treasurer Title: President
--------------------------- ----------------------------
Date: September 21, 1999 Date: September 22, 1999
--------------------------- ----------------------------
BOSTON PARTNERS
ASSET MANAGEMENT, L.P.
By: BOSTON PARTNERS, INC.
its General Partner
By: /s/ William J. Kelly
-----------------------------
Title: Treasurer
<PAGE>
EXHIBIT (h)(55)
October 13, 1999
Edward J. Roach
President
The RBB Fund, Inc.
Bellevue Park Corporate Center
400 Bellevue Parkway, Suite 100
Wilmington, DE 19809
Re: n/i numeric investors family of funds of The RBB Fund, Inc.
Dear Mr. Roach:
By our execution of this letter agreement (the "Agreement"), intending
to be legally bound hereby, Numeric Investors L.P. (the "Adviser") agrees that
in order to improve the performance of the n/i numeric investors family of funds
which is comprised of the Micro Cap, Growth, Growth & Value, Larger Cap Value
and Small Cap Value Funds (each a "Fund" and collectively, the "Numeric Funds")
of The RBB Fund, Inc., the Adviser shall, from January 1, 2001 through December
31, 2001, waive all or a portion of its investment advisory fees and/or
reimburse expenses (other than brokerage commissions, extraordinary items,
interest and taxes) in an aggregate amount equal to the amount by which a Fund's
total operating expenses (other than investment advisory fees, brokerage
commissions, extraordinary items, interest and taxes) exceeds a total operating
expense ratio (other than investment advisory fees, brokerage commissions,
extraordinary items, interest and taxes) of 0.50% of such Fund's average daily
net assets.
The Adviser acknowledges that (1) it shall not be entitled to collect
on or make a claim for waived fees at any time in the future, and (2) it shall
not be entitled to collect on or make a claim for reimbursed Fund expenses at
any time in the future. Notwithstanding anything herein to the contrary, the
Adviser shall have no obligation to waive advisory fees and/or reimburse
expenses with respect to a Fund hereunder unless and until the particular Fund's
shareholders approve an amendment (as described in The RBB Fund, Inc.'s Proxy
Statement dated October 13, 1999) to that Fund's Investment Advisory Agreement,
by and between The RBB Fund, Inc. and the Adviser, pursuant to which the Adviser
would be compensated on a performance fee basis.
NUMERIC INVESTORS L.P.
By: /s/ Dan Lehan
-------------------------------
Dan Lehan
Title: CFO
Your signature below acknowledges
acceptance of this Agreement:
By: /s/ Edward J. Roach
--------------------
Edward J. Roach
President and Treasurer
The RBB Fund, Inc.
<PAGE>
EXHIBIT (h)(56)
ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT
------------------------------------------------
THIS AGREEMENT is made as of September 15, 1999 by and between The RBB
Fund, Inc. a Maryland corporation (the "Fund"), and PFPC INC., a Delaware
corporation ("PFPC"), which is an indirect wholly owned subsidiary of PFPC
Worldwide, Inc.
W I T N E S S E T H :
WHEREAS, the Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, the Fund wishes to retain PFPC to provide administration and
accounting services to Bogle Investment Management Small Cap Growth Fund (the
"Portfolio"), and PFPC wishes to furnish such services.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, and intending to be legally bound hereby the parties hereto
agree as follows:
1. Definitions. As Used in this Agreement:
----------------------------------------
(a) "1933 Act" means the Securities Act of 1933, as amended.
(b) "1934 Act" means the Securities Exchange Act of 1934, as amended.
(c) "Authorized Person" means any officer of the Fund and any other
person duly authorized by the Fund's Board of Directors to give Oral
Instructions and Written Instructions on behalf of the Fund and listed
on the Authorized Persons Appendix attached hereto and made a part
hereof or any amendment thereto as may be received by PFPC. An
Authorized Person's scope of authority may be limited by the Fund by
setting forth such limitation in the Authorized Persons Appendix.
(d) "CEA" means the Commodities Exchange Act, as amended.
<PAGE>
(e) "Change of Control" means a change in ownership or control (not
including transactions between wholly-owned direct or indirect
subsidiaries of a common parent) of John Bogle, Jr. to less than 50%
plus one share of the common stock or shares of beneficial interest in
the general partner of Bogle Investment Management, L.P.
(f) "Oral Instructions" mean oral instructions received by PFPC from an
Authorized Person or from a person reasonably believed by PFPC to be
an Authorized Person.
(g) "SEC" means the Securities and Exchange Commission.
(h) "Securities Laws" means the 1933 Act, the 1934 Act, the 1940 Act and
the CEA.
(i) "Shares" means the shares of beneficial interest of any series or
class of the Fund.
(j) "Written Instructions" mean written instructions signed by an
Authorized Person and received by PFPC. The instructions may be
delivered by hand, mail, tested telegram, cable, telex or facsimile
sending device.
2. Appointment. The Fund hereby appoints PFPC to provide administration and
-----------
accounting services to the Portfolio, in accordance with the terms set
forth in this Agreement. PFPC accepts such appointment and agrees to
furnish such services.
3. Delivery of Documents. The Fund has provided or, where applicable, will
---------------------
provide PFPC with the following:
(a) certified or authenticated copies of the resolutions of the Fund's
Board of Directors, approving the appointment of PFPC or its
affiliates to provide services to the Portfolio and approving this
Agreement;
(b) a copy of Fund's most recent effective registration statement;
(c) a copy of the Portfolio's advisory agreement or agreements;
2
<PAGE>
(d) a copy of the distribution agreement with respect to each class of
Shares representing an interest in the Portfolio;
(e) a copy of any additional administration agreement with respect to the
Portfolio;
(f) a copy of any shareholder servicing agreement made in respect of the
Fund or the Portfolio; and
(g) copies (certified or authenticated, where applicable) of any and all
amendments or supplements to the foregoing.
4. Compliance with Rules and Regulations.
-------------------------------------
PFPC undertakes to comply with the applicable requirements of the
Securities Laws, and any laws, rules and regulations of governmental
authorities having jurisdiction with respect to the duties to be performed
by PFPC hereunder. Except as specifically set forth herein, PFPC assumes
no responsibility for such compliance by the Fund or the Portfolio.
5. Instructions.
------------
(a) Unless otherwise provided in this Agreement, PFPC shall act only upon
Oral Instructions and Written Instructions.
(b) PFPC shall be entitled to rely upon any Oral Instructions and Written
Instructions it receives from an Authorized Person (or from a person
reasonably believed by PFPC to be an Authorized Person) pursuant to
this Agreement. PFPC may assume that any Oral Instruction or Written
Instruction received hereunder is not in any way inconsistent with the
provisions of organizational documents or this Agreement or of any
vote, resolution or proceeding of the Fund's Board of Directors or of
the Fund's shareholders, unless and until PFPC receives Written
Instructions to the contrary.
(c) The Fund agrees to forward to PFPC Written Instructions confirming
Oral
3
<PAGE>
Instructions (except where such Oral Instructions are given by PFPC or
its affiliates) so that PFPC receives the Written Instructions by the
close of business on the same day that such Oral Instructions are
received. The fact that such confirming Written Instructions are not
received by PFPC shall in no way invalidate the transactions or
enforceability of the transactions authorized by the Oral
Instructions. Where Oral Instructions or Written Instructions
reasonably appear to have been received from an Authorized Person,
PFPC shall incur no liability to the Fund in acting upon such Oral
Instructions or Written Instructions provided that PFPC's actions
comply with the other provisions of this Agreement.
6. Right to Receive Advice.
-----------------------
(a) Advice of the Fund. If PFPC is in doubt as to any action it should or
------------------
should not take, PFPC may request directions or advice, including Oral
Instructions or Written Instructions, from the Fund.
(b) Advice of Counsel. If PFPC shall be in doubt as to any question of
-----------------
law pertaining to any action it should or should not take, PFPC may
request advice at its own cost from such counsel of its own choosing
(who may be counsel for the Fund, the Fund's investment adviser or
PFPC, at the option of PFPC).
(c) Conflicting Advice. In the event of a conflict between directions,
------------------
advice or Oral Instructions or Written Instructions PFPC receives from
the Fund and the advice PFPC receives from counsel, PFPC may rely upon
and follow the advice of counsel. In the event PFPC so relies on the
advice of counsel, PFPC remains liable for any action or omission on
the part of PFPC which constitutes willful misfeasance, bad faith,
gross negligence or reckless disregard by PFPC of any
4
<PAGE>
duties, obligations or responsibilities set forth in this Agreement.
(d) Protection of PFPC. PFPC shall be protected in any action it takes or
------------------
does not take in reliance upon directions, advice or Oral Instructions
or Written Instructions it receives from the Fund or from counsel and
which PFPC believes, in good faith, to be consistent with those
directions, advice and Oral Instructions or Written Instructions.
Nothing in this section shall be construed so as to impose an
obligation upon PFPC (i) to seek such directions, advice or Oral
Instructions or Written Instructions, or (ii) to act in accordance
with such directions, advice or Oral Instructions or Written
Instructions unless, under the terms of other provisions of this
Agreement, the same is a condition of PFPC's properly taking or not
taking such action. Nothing in this subsection shall excuse PFPC when
an action or omission on the part of PFPC constitutes willful
misfeasance, bad faith, gross negligence or reckless disregard by PFPC
of any duties, obligations or responsibilities set forth in this
Agreement.
7. Records; Visits.
---------------
(a) The books and records pertaining to the Fund and the Portfolio which
are in the possession or under the control of PFPC 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, rules and regulations. The Fund and Authorized Persons shall
have access to such books and records at all times during PFPC's
normal business hours. Upon the reasonable request of the Fund,
copies of any such books and records shall be provided by PFPC to the
Fund or to an Authorized Person, at the Fund's expense.
5
<PAGE>
(b) PFPC shall keep the following records:
(i) all books and records with respect to the Portfolio's books of
account;
(ii) records of the Portfolio's securities transactions; and
(iii) all other books and records as PFPC is required to maintain
pursuant to Rule 31a-1 of the 1940 Act in connection with the
services provided hereunder.
8. Confidentiality. PFPC agrees to keep confidential the records of the Fund
---------------
and information relating to the Fund and its shareholders, unless the
release of such records or information is otherwise consented to, in
writing, by the Fund. The Fund agrees that such consent shall not be
unreasonably withheld and may not be withheld where PFPC may be exposed to
civil or criminal contempt proceedings or when required to divulge such
information or records to duly constituted authorities.
9. Liaison with Accountants. PFPC shall act as liaison with the Fund's
------------------------
independent public accountants and shall provide account analyses, fiscal
year summaries, and other audit-related schedules with respect to the
Portfolio. PFPC shall take all reasonable action in the performance of its
duties under this Agreement to assure that the necessary information is
made available to such accountants for the expression of their opinion, as
required by the Fund.
10. Disaster Recovery. PFPC shall enter into and shall maintain in effect with
-----------------
appropriate parties one or more agreements making reasonable provisions for
emergency use of electronic data processing equipment to the extent
appropriate equipment is available. In the event of equipment failures,
PFPC shall, at no additional expense to the Fund, take reasonable steps to
minimize service interruptions. PFPC shall have no liability with respect
to the loss of data or service interruptions caused by equipment failure,
provided
6
<PAGE>
such loss or interruption is not caused by PFPC's own willful misfeasance,
bad faith, gross negligence or reckless disregard of its duties or
obligations under this Agreement.
11. Year 2000 Readiness Disclosure. PFPC (a) has reviewed its business and
------------------------------
operations as they relate to the services provided hereunder, (b) has
remediated or replaced computer applications and systems controlled by PFPC
and which are mission-critical to providing services hereunder (the
"Relevant Systems"), and (c) has implemented a testing plan to test the
remediation or replacement of the Relevant Systems to address on a timely
basis the risk that the Relevant Systems may be unable to process over the
January 1, 2000 boundary and on the leap day of February 29, 2000. PFPC
represents and warrants that, based on assessments and testing to date,
processing errors by the Relevant Systems involving such boundary and leap
day are not likely to occur. PFPC will continue to monitor and test the
Relevant Systems and make adjustments as necessary.
12. Compensation. As compensation for services rendered by PFPC during the
------------
term of this Agreement, the Fund, on behalf of the Portfolio, will pay to
PFPC a fee or fees as may be agreed to in writing by the Fund and PFPC.
13. Indemnification. The Fund, on behalf of the Portfolio, agrees to indemnify
---------------
and hold harmless PFPC and its affiliates from all taxes, charges,
expenses, assessments, claims and liabilities (including, without
limitation, liabilities arising under the Securities Laws and any state or
foreign securities and blue sky laws, and amendments thereto), and
expenses, including (without limitation) attorneys' fees and disbursements
arising directly or indirectly from any action or omission to act which
PFPC takes (i) at the request or on the direction of or in reliance on the
advice of the Fund or (ii) upon Oral Instructions or Written Instructions.
Neither PFPC, nor any of its affiliates, shall be indemnified against
7
<PAGE>
any liability (or any expenses incident to such liability) arising out of
PFPC's or its affiliates' own willful misfeasance, bad faith, gross
negligence or reckless disregard of its duties and obligations under this
Agreement.
14. Responsibility of PFPC.
----------------------
(a) PFPC shall be under no duty to take any action on behalf of the Fund
or the Portfolio except as specifically set forth herein or as may be
specifically agreed to by PFPC in writing. PFPC shall be obligated to
exercise care and diligence in the performance of its duties hereunder
and to act in good faith in performing services provided for under
this Agreement. PFPC shall be liable for any damages arising out of
PFPC's failure to perform its duties under this Agreement to the
extent such damages arise out of PFPC's willful misfeasance, bad
faith, gross negligence or reckless disregard of such duties.
(b) Without limiting the generality of the foregoing or of any other
provision of this Agreement, (i) PFPC shall not be liable for losses
beyond its control, provided that PFPC has acted in accordance with
the standard of care set forth above; and (ii) PFPC shall not be
liable for (A) the validity or invalidity or authority or lack thereof
of any Oral Instruction or Written Instruction, notice or other
instrument which conforms to the applicable requirements of this
Agreement, and which PFPC reasonably believes to be genuine; or (B)
subject to Section 10, delays or errors or loss of data occurring by
reason of circumstances beyond PFPC's control, including acts of civil
or military authority, national emergencies, labor difficulties, fire,
flood, catastrophe, acts of God, insurrection, war, riots or failure
of the mails, transportation, communication or power supply.
8
<PAGE>
(c) Notwithstanding anything in this Agreement to the contrary, neither
PFPC nor its affiliates shall be liable to the Fund or to the
Portfolio for any consequential, special or indirect losses or
damages which the Fund or the Portfolio may incur or suffer by or as
a consequence of PFPC's or any affiliates' performance of the
services provided hereunder, whether or not the likelihood of such
losses or damages was known by PFPC or its affiliates.
15. Description of Accounting Services on a Continuous Basis.
--------------------------------------------------------
PFPC will perform the following accounting services with respect to the
Portfolio:
(i) Journalize investment, capital share and income and expense
activities;
(ii) Verify investment buy/sell trade tickets when received from the
investment adviser for a Portfolio (the "Adviser") and transmit
trades to the Fund's custodian (the "Custodian") for proper
settlement;
(iii) Maintain individual ledgers for investment securities;
(iv) Maintain historical tax lots for each security;
(v) Reconcile cash and investment balances of the Fund with the
Custodian, and provide the Adviser with the beginning cash balance
available for investment purposes;
(vi) Update the cash availability throughout the day as required by the
Adviser;
(vii) Post to and prepare the Statement of Assets and Liabilities and the
Statement of Operations;
(viii) Calculate various contractual expenses (e.g., advisory and custody
----
fees);
(ix) Monitor the expense accruals and notify an officer of the Fund of
any proposed adjustments;
(x) Control all disbursements and authorize such disbursements upon
Written Instructions;
(xi) Calculate capital gains and losses;
9
<PAGE>
(xii) Determine net income;
(xiii) Obtain security market quotes from independent pricing services
approved by the Adviser, or if such quotes are unavailable, then
obtain such prices from the Adviser, and in either case calculate
the market value of the Portfolio's Investments;
(xiv) Transmit or mail a copy of the daily portfolio valuation to the
Adviser;
(xv) Compute net asset value;
(xvi) As appropriate, compute yields, total return, expense ratios,
portfolio turnover rate, and, if required, portfolio average
dollar-weighted maturity; and
(xvii) Prepare a monthly financial statement, which will include the
following items:
Schedule of Investments
Statement of Assets and Liabilities
Statement of Operations
Statement of Changes in Net Assets
Cash Statement
Schedule of Capital Gains and Losses.
16. Description of Administration Services on a Continuous Basis.
------------------------------------------------------------
PFPC will perform the following administration services with respect to the
Portfolio:
(i) Prepare quarterly broker security transactions summaries;
(ii) Prepare monthly security transaction listings;
(iii) Supply various normal and customary Portfolio and Fund statistical
data as requested on an ongoing basis;
(iv) Prepare for execution and file the Fund's Federal and state tax
returns;
(v) Prepare and file the Fund's Semi-Annual Reports with the SEC on
Form N-SAR;
(vi) Prepare and file with the SEC the Fund's annual, semi-annual, and
quarterly shareholder reports;
(vii) Assist in the preparation of registration statements and other
filings relating to the registration of Shares;
(viii) Monitor each Portfolio's status as a regulated investment company
under Sub-
10
<PAGE>
chapter M of the Internal Revenue Code of 1986, as amended;
(ix) Coordinate contractual relationships and communications between
the Fund and its contractual service providers; and
(x) Monitor the Fund's compliance with the amounts and conditions of
each state qualification.
17. Duration and Termination. This Agreement shall continue until terminated
------------------------
by the Fund or by PFPC on sixty (60) days' prior written notice to the
other party.
18. Change of Control. Notwithstanding any other provision of this Agreement,
-----------------
in the event of an agreement ("Change of Control Agreement") to enter into
a transaction that would result in a Change of Control of the Fund's
adviser or sponsor, the Fund's ability to terminate the Agreement will be
suspended from the time of such agreement until two years after the Change
of Control, provided however; (i) that such ability to terminate will be
reinstated if the Change of Control Agreement is abandoned; and (ii) that
the Fund may terminate this Agreement for cause on sixty (60) days' prior
written notice to the other party. For purposes of this Agreement, "cause"
shall mean willful misfeasance, bad faith, gross negligence, or multiple
negligent acts by PFPC which in the aggregate are determined by the Fund's
Board of Directors to constitute a serious failure to perform
satisfactorily PFPC's obligations hereunder or reckless disregard on the
part of PFPC with respect to its obligations and duties set forth herein.
19. Notices. All notices and other communications, including Written
-------
Instructions, shall be in writing or by confirming telegram, cable, telex
or facsimile sending device. If notice is sent by confirming telegram,
cable, telex or facsimile sending device, it shall be deemed to have been
given immediately. If notice is sent by first-class mail, it shall be
deemed to have been given three days after it has been mailed. If notice is
sent by messenger, it
11
<PAGE>
shall be deemed to have been given on the day it is delivered. Notices
shall be addressed (a) if to PFPC, at 400 Bellevue Parkway, Wilmington,
Delaware 19809, Attention: President; (b) if to the Fund, Bogle Investment
Management, L.P., 57 River Street, Suite 206, Wellesley, MA 02481,
Attention: President; or (c) if to neither of the foregoing, at such other
address as shall have been provided by like notice to the sender of any
such notice or other communication by the other party.
20. Amendments. This Agreement, or any term thereof, may be changed or waived
----------
only by written amendment, signed by the party against whom enforcement of
such change or waiver is sought.
21. Delegation; Assignment. PFPC may assign its rights and delegate its duties
----------------------
hereunder to any majority-owned direct or indirect subsidiary of PFPC or
PNC Bank Corp., provided that (i) PFPC gives the Fund 30 days prior written
notice of such assignment or delegation, (ii) the assignee or delegate
agrees to comply with the relevant provision of the 1940 Act, and (iii)
PFPC and such assignee or delegate promptly provide such information as the
Fund may reasonably request, and respond to such questions as the Fund may
reasonably ask, relative to the assignment or delegation (including,
without limitation, the capabilities of the assignee or delegate).
22. 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.
23. Further Actions. Each party agrees to perform such further acts and
---------------
execute such further documents as are necessary to effectuate the purposes
hereof.
12
<PAGE>
24. Miscellaneous.
-------------
(a) This Agreement embodies the entire agreement and understanding between
the parties and supersedes all prior agreements and understandings
relating to the subject matter hereof, provided that the parties may
embody in one or more separate documents their agreement, if any, with
respect to delegated duties and Oral Instructions. 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. Notwithstanding any provision
hereof, the services of PFPC are not, nor shall they be, construed as
constituting legal advice or the provision of legal services for or on
behalf of the Fund or any other person.
(b) This Agreement shall be deemed to be a contract made in Delaware and
governed by Delaware law, without regard to principles of conflicts of
law.
(c) 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 permitted assigns.
(d) The facsimile signature of any party to this Agreement shall
constitute the valid and binding execution hereof by such party.
13
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
PFPC INC.
By: /s/ Stephen M. Wynne
---------------------
Title: Executive Vice President
THE RBB FUND, INC.
By: /s/ Edward J. Roach
--------------------
Title: President and Treasurer
14
<PAGE>
EXHIBIT A
---------
THIS EXHIBIT A, dated as of September 15, 1999 is Exhibit A to that certain
Administration and Accounting Services Agreement dated as of September 15, 1999
between PFPC Inc. and The RBB Fund, Inc.
PORTFOLIOS
----------
Bogle Investment Management Small Cap Growth Fund
15
<PAGE>
AUTHORIZED PERSONS APPENDIX
NAME (Type) SIGNATURE
John C. Bogle, Jr. /s/ John C. Bogle, Jr.
- ---------------------------- ----------------------------------
Keith D. Hartt /s/ Keith D. Hartt
- ---------------------------- ----------------------------------
Britt S. Martino /s/ Britt S. Martino
- ---------------------------- -----------------------------------
Lisa LaFrance /s/ Lisa LaFrance
- ---------------------------- -----------------------------------
____________________________ ___________________________________
____________________________ ___________________________________
16
<PAGE>
EXHIBIT (h)(57)
SOLICITATION AGREEMENT
----------------------
This document will constitute the agreement between N/I NUMERIC INVESTORS FAMILY
OF FUNDS investment portfolios of the RBB Fund, Inc. (the "Fund") c/o PFPC Inc.
with its principal executive offices at Bellevue Corporate Center, 400 Bellevue
Parkway, Wilmington, DE 19809 and SHAREHOLDER COMMUNICATIONS CORPORATION
("SCC"), with its principal executive offices at 17 State Street, New York, NY
10004, relating to the solicitation of proxies for the 1999 Special Meeting of
Shareholders.
The services to be provided by SCC will be as follows:
(1) INDIVIDUAL HOLDERS OF RECORD
----------------------------
A. Targeting. SCC has analyzed the share range profile of the Fund and
---------
believes that it can produce the required vote totals by limiting its
telephone solicitation efforts to the largest shareholders.
B. Lookups. SCC will obtain the needed telephone numbers from
-------
information operators and various types of telephone directories.
C. Initial Telephone Solicitation. SCC will begin telephone calls to
------------------------------
target holders as soon as practical. Most calls will be made during
the hours of 9:00 A.M. to 9:00 P.M. period on business days and during
the hours of 12:00 P.M. to 6:00 P.M. period on Saturdays. SCC will
--------
not call any shareholder after 9:00 P.M. on any day, in any time zone.
---------------------------------------------------------------------
SCC will not contact known retirement community zip code ranges after
5:00 P.M.
D. Remails. SCC will coordinate with the Fund's mailing/tabulating
-------
vendor the remailing of proxy materials to shareholders who advise us
that they have discarded or misplaced the originally mailed materials.
E. Reminder/Adjournment Mailing. SCC will help to coordinate any broad-
----------------------------
based reminder or adjournment mailing upon consultation with the Fund.
F. Voting Reports. SCC will rely upon the tabulator for accurate and
--------------
timely information as to voting by account.
<PAGE>
(2) BANK/BROKER SERVICING (if applicable)
---------------------
A. SCC will contact all banks, brokers and other nominee shareholders
("intermediaries") holding stock as shown on appropriate portions of
the Fund's shareholder lists to ascertain quantities of proxy
materials needed for forwarding to beneficial owners.
B. SCC will deliver proxy materials by messenger to New York City based
intermediaries and by Federal Express or other means to non-New York
City based intermediaries to insure receipt of the proxy materials and
to confirm timely remailing of materials to the beneficial owners.
C. SCC will maintain frequent contact with intermediaries to monitor
shareholder response and to insure that all liaison procedures are
proceeding satisfactorily and will exert every effort to maximize the
vote count. In addition, SCC will contact beneficial holders directly,
if possible and do whatever solicitation SCC may deem appropriate or
necessary with respect to this group.
D. SCC will deliver street proxies to the tabulator in time to be counted
at the shareholder meeting.
(3) PROJECT FEE (SCC only)
-----------
In consideration for SCC acting as proxy solicitor, the Fund will pay to
SCC a project fee of $5,000.
(4) ESTIMATED EXPENSES (SCC only)
------------------
The Fund will reimburse SCC for any expenses incurred by SCC in connection
with the services provided to the Fund herein. The expenses as outlined are
estimated and the estimates are based largely on the information provided
to SCC by the Fund. In the course of the solicitation, the expenses and
expense categories may change. In the event of significant change or new
expenses not originally contemplated, SCC will notify an officer(s) of the
Fund either by phone and/or by letter for prior written approval of such
expenses. SCC expense estimates do not include invoices received from ADP,
brokers and banks in connection with forwarding material to underlying
beneficial shareholders, which invoices will be paid by the Fund.
ESTIMATED EXPENSES* Low Range High Range
- ------------------- --------- ----------
Data Handling and Preparation
Telephone # Lookup - Computer Match & Information
Operators (blended rate)
3,675 to 4,750 @ $.25................................ $ 918.75 $1,187.507
<PAGE>
<TABLE>
<S> <C> <C>
Duplicate Account Consolidation - householding
3,675 to 4,750 @ $.10........................................... 367.50 475.00
Voted data (daily match - one time charge)
3,675 to 4,750 @ $.10........................................... 367.50 475.00
Telephone Solicitation
Outgoing and Incoming Telephone Calls (line charges included)
1,425 to 1,900 @ $3.00.......................................... 4,275.00 5,700.00
TeleVotes(TM) (registered & beneficial accounts)
665 to 800 @ $5.00.............................................. 3,325.00 4,000.00
**TeleVote(TM) Confirmations (registered accounts only)
665 to 800 @ $.65............................................... 432.25 520.00
Miscellaneous - FedEx, fax, data processing, street search,
messengers and select remails................................... 150.00 500.00
Total Estimated Expenses................................... $9,836.00 12,857.50
========= =========
</TABLE>
* SCC reserves the right to interchange budget categories as solicitation
conditions dictate.
** Does not include ADP's tabulation/confirmation charge for beneficial
TeleVotes
(5) GUARANTEES
----------
A. SCC will be able to utilize its telephone voting program for
registered and beneficial accounts.
B. In the event opposition in the form of negative and abstain votes,
combined, exceeds 13% of the outstanding shares, SCC will not be bound
by a guarantee to deliver the vote for the Fund, but SCC will do
everything possible to deliver the vote.
C. SCC bases its ability to deliver the vote on historical evidence of
voting trends displayed by mutual funds shareholders, when contacted
and reminded to vote. SCC does not use pressure solicitation tactics
and will not change negative and/or abstention votes unless authorized
to do so by the Fund. Further, SCC will not advise a shareholder how
to vote other than to reiterate the content or recommendation (if any)
that is contained in the proxy statement.
<PAGE>
(6) PAYMENT
-------
Payment for one half the project fee ($2,500.00) and one half the low range
estimated expenses ($4,918.00) for a total of $7,418.00 will be made upon
the signing of this Agreement. The balance will be due thirty days after
SCC sends its final accounting and invoice.
(7) MISCELLANEOUS
-------------
A. The Fund will forward to SCC and receive approval from SCC on all
documents prepared by the Fund which mention SCC or the services to be
rendered by SCC.
B. SCC agrees to maintain in confidence all non-public information
acquired from the Fund relating to the transactions described herein,
including, but not limited to, the shareholder lists and data
contained therein. SCC will not sell or otherwise market the names of
shareholders provided to SCC in the course of the solicitation nor use
such names or other confidential information for any purpose other
than in accordance with its duties hereunder.
C. The Fund agrees to furnish to SCC shareholder lists in a form
requested by SCC and proxy statements and other solicitation materials
prepared for the Fund in such quantities and on a delivery date as
requested by SCC.
D. In the event the project is terminated by the Fund or deferred for an
indefinite period of time after the signing of this contract and
before the meeting date, SCC will be reimbursed by the Fund for
expenses incurred to the date of such termination or deferral pursuant
to Section 4, and not less than 100% of the project fee, except
however, that if the solicitation is stopped before the proxies are
mailed, the Fund shall only reimburse SCC for actual expenses, and no
portion of the project fee shall be due.
E. The Fund agrees to indemnify and hold harmless SCC and its
stockholders, officers, directors, employees, agents and affiliates
against any and all claims, costs, damages, liabilities, judgments and
expenses, including the fees, costs and expenses of counsel retained
by SCC ("Losses"), which result from claims, actions, suits,
subpoenas, demands or other proceedings brought against or involving
SCC which directly relate to or arise out of SCC's performance of the
Services (except for costs, damages, liabilities, judgments or
expenses which shall have been determined by a court of law pursuant
to a final and nonappealable judgment to have directly resulted from
SCC's gross negligence or intentional misconduct. SCC agrees to
indemnify and hold harmless the Fund and its
<PAGE>
stockholders, officers, directors, employees, agents and affiliates
against any and all Losses, which result from claims, actions, suits,
subpoenas, demands or other proceedings brought against or involving
any of them which directly relate to or arise out of SCC's gross
negligence or intentional misconduct. In addition, the prevailing
party shall be entitled to reasonable attorneys' fees and court costs
in any action between the parties to enforce the provisions of this
Agreement, including the indemnification rights contained in this
paragraph. The indemnity obligations set forth in this shall survive
the termination of this Agreement.
F. This Agreement shall be governed and construed in accordance with New
York law and the parties acknowledge that performance of this
Agreement will be in New York, New York, and each party hereby
consents to jurisdiction in the state courts of New York. This
Agreement may not be assigned by SCC. This Agreement sets forth the
entire understanding between the parties hereto as to the subject
matter herein, and no amendment or modification of the terms of this
Agreement may be made except in writing, signed by the Fund and SCC.
IN WITNESS WHEREOF, the parties have signed this AGREEMENT this 6th day of
October, 1999.
THE RBB FUND, INC. SHAREHOLDER COMMUNICATIONS
CORPORATION
By /s/ Edward Roach By /s/ Marianne Y. Hee
----------------------------- --------------------
Edward Roach Marianne Y. Hee
Treasurer Vice President
<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
November 29, 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. 69 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 of Post-Effective Amendment No. 69 (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 the following classes and numbers of shares
of common stock, $.001 par value per share (collectively, the "Shares"), with
respect to the n/i numeric investors Micro Cap Fund, the n/i numeric investors
Growth Fund, the n/i numeric investors Mid Cap Fund, the n/i numeric investors
Larger Cap Value Fund and the n/i numeric investors Small Cap Value Fund:
Portfolio Class Authorized Shares
--------- ----- -----------------
n/i numeric investors Micro FF 50,000,000
Cap Fund
n/i numeric investors GG 50,000,000
Growth Fund
n/i numeric investors HH 50,000,000
Mid Cap Fund
n/i numeric investors Larger XX 50,000,000
Cap Value Fund
n/i numeric investors Small MMM 100,000,000
Cap Value Fund
<PAGE>
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.
We assumed that, prior to the effectiveness of the Amendment under the
1933 Act, the Company will have filed with the Maryland Department of
Assessments and Taxation all necessary documents (the "Documents") to authorize,
classify and establish the Shares.
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 and the Documents for not less than $.001 per share, will be
legally issued, fully paid and non-assessable by the Company.
We hereby consent to the filing of this opinion as an exhibit to
Post-Effective Amendment No. 69 to the Company's Registration Statement.
Very truly yours,
/s/ Drinker Biddle & Reath LLP
------------------------------
DRINKER BIDDLE & REATH LLP
-2-
<PAGE>
EXHIBIT (j)(1)
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 Statements of Additional Information that are
included in Post-Effective Amendment No. 69 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
November 29, 1999
<PAGE>
EXHIBIT (j)(2)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Post-Effective
Amendment No. 69 to the Registration Statement on Form N-1A of our report dated
October 15, 1999 relating to the financial statements and financial highlights
of 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, separately managed
portfolios of The RBB Fund, Inc. (the "Fund"), which appears in the Annual
Report to Shareholders of the Fund for the year ended August 31, 1999. We also
consent to the references to us under the heading "Financial Highlights" in the
Prospectus and under the headings "Miscellaneous-Independent Accountants" and
"Financial Statements" in the Statement of Additional Information in such
Registration Statement.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
2400 Eleven Penn Center
Philadelphia, Pennsylvania
November 29, 1999
