-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KhFKegiZp/limvA1g87Q9IIpTqvm67htIQfOc+JygETf6Kc0S+5FEZsJz2/85Ty1 /dCZv/EfLDBWTwSCesbEYA== 0000950109-97-007367.txt : 19971209 0000950109-97-007367.hdr.sgml : 19971209 ACCESSION NUMBER: 0000950109-97-007367 CONFORMED SUBMISSION TYPE: 485BPOS PUBLIC DOCUMENT COUNT: 25 FILED AS OF DATE: 19971208 EFFECTIVENESS DATE: 19971208 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: RBB FUND INC CENTRAL INDEX KEY: 0000831114 STANDARD INDUSTRIAL CLASSIFICATION: [] FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: SEC FILE NUMBER: 033-20827 FILM NUMBER: 97733827 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: SEC FILE NUMBER: 811-05518 FILM NUMBER: 97733828 BUSINESS ADDRESS: STREET 1: 400 BELLEVUE PKWY STE 100 CITY: WILMINGTON STATE: DE ZIP: 19809 BUSINESS PHONE: 3027911791 MAIL ADDRESS: STREET 1: 103 BELLEVUE PKWY STREET 2: SUITE 152 CITY: WILMINGTON STATE: DE ZIP: 19809 FORMER COMPANY: FORMER CONFORMED NAME: FUND INC /DE/ DATE OF NAME CHANGE: 19600201 485BPOS 1 POST-EFFECTIVE AMENDMENT NO. 51 As filed with the Securities and Exchange Commission on December 8, 1997 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. 51 [X] and REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X] Amendment No. 53 [X] ------------------------------------- THE RBB FUND, INC. (Government Securities Portfolio: RBB Class; BEA International Equity Portfolio: BEA Class, BEA Investor Class and BEA Advisor Class; BEA High Yield Portfolio: BEA Class, BEA Investor Class and BEA Advisor Class; BEA Emerging Markets Equity Portfolio: BEA Class, BEA Investor Class and BEA Advisor Class; BEA U.S. Core Equity Portfolio: BEA Class; BEA U.S. Core Fixed Income Portfolio: BEA Class; BEA Strategic Global Fixed Income Portfolio: BEA Class; BEA Municipal Bond Fund Portfolio: BEA Class; BEA Balanced Fund Portfolio: BEA Class; BEA Short Duration Portfolio: BEA Class; BEA Global Telecommunications Portfolio: BEA Investor Class and BEA Advisor Class; ni Numeric Investors Micro Cap Fund: ni Class; ni Numeric Investors Growth Fund: ni Class; ni Numeric Investors Growth & Value Fund: ni Class; ni Numeric Investors Larger Cap Value Fund: ni Class; Boston Partners Large Cap Value Fund: Boston Partners Advisor Class, Boston Partners Institutional Class and Boston Partners Investor Class; Boston Partners Mid Cap Value Fund: Boston Partners Institutional Class and Boston Partners Investor Class; Boston Partners Bond Fund: Boston Partners Institutional Class and Boston Partners Investor Class; Money Market Portfolio: Cash Preservation Class, Sansom Street Class, Bedford Class, Janney Class, Beta Class, Gamma Class, Delta Class, Epsilon Class, Zeta Class, Eta Class and Theta Class; Municipal Money Market Portfolio: Cash Preservation Class, Sansom Street Class, Bedford Class, Janney Class, Beta Class, Gamma Class, Delta Class, Epsilon Class, Zeta Class, Eta Class and Theta Class; Government Obligations Money Market Portfolio: Sansom Street Class, Bedford Class, Janney Class, Beta Class, Gamma Class, Delta Class, Epsilon Class, Zeta Class, Eta Class and Theta Class; New York Municipal Money Market Portfolio: Bedford Class, Janney Class, Beta Class, Gamma Class, Delta Class, Epsilon Class, Zeta Class, Eta Class and Theta Class) ------------------------------------------------------------------------ (Exact Name of Registrant as Specified in Charter) Bellevue Park Corporate Center 400 Bellevue Parkway, Suite 100 Wilmington, DE 19809 (Address of Principal Executive Offices) ---------------------------------------- Registrant's Telephone Number: (302) 792-2555 Copies to: GARY M. GARDNER, ESQUIRE MICHAEL P. MALLOY, ESQUIRE PNC Bank, National Association Drinker Biddle & Reath LLP 1600 Market Street, 28th Floor 1100 PNB Building Philadelphia, PA 19103 1345 Chestnut Street (Name and Address of Agent for Service) Philadelphia, PA 19107-3496 It is proposed that this filing will become effective (check appropriate box) [_] immediately upon filing pursuant to paragraph (b) [X] on December 9, 1997 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 RBB FUND, INC. (n/i Numeric Investors Micro Cap, n/i Numeric Investors Growth, n/i Numeric Investors Growth & Value and n/i Numeric Investors Larger Cap Value Funds) n/i numeric investors family of funds CROSS REFERENCE SHEET --------------------- Pursuant to Rule 495(a) under the Securities Act of 1933
Form N-1A Item Location - -------------- -------- Part A Prospectus 1. Cover Page........................................ Cover Page 2. Synopsis.......................................... Introduction 3. Condensed Financial Information................... Financial Highlights 4. General Description of Registrant................. Cover Page; The Funds; Investment Objectives and Policies; Investment Limitations 5. Management of the Fund............................ Management 5A. Management's Discussion of Fund Performance............................. Not Applicable 6. Capital Stock and Other Securities................ Dividends and Distributions; Taxes; Description of Shares 7. Purchase of Securities Being Offered.............. How to Purchase Shares; Net Asset Value 8. Redemption or Repurchase.......................... How to Redeem Shares; Net Asset Value 9. Pending Legal Proceedings......................... Not Applicable
THE RBB FUND, INC. (n/i Numeric Investors Micro Cap, n/i Numeric Investors Growth, n/i Numeric Investors Growth & Value and n/i Numeric Investors Larger Cap Value Funds) n/i numeric investors family of funds CROSS REFERENCE SHEET --------------------- Pursuant to Rule 495(a) under the Securities Act of 1933
Form N-1A Item Location - -------------- -------- PART B STATEMENT OF ADDITIONAL INFORMATION 10. Cover Page...................................... Cover Page 11. Table of Contents............................... Cover Page 12. General Information and History................. General; Directors and Officers; Additional Information Concerning Fund Shares; Miscellaneous; see Prospectus - "The Funds" 13. Investment Objectives and Policies.............. Investment Objectives and Policies; Investment Limitations 14. Management of the Fund.......................... Directors and Officers; Investment Advisory, Distribution and Servicing Arrangements 15. Control Persons and Principal Holders of Securities................................. Miscellaneous 16. Investment Advisory and Other Services...................................... Investment Advisory, Distribution and Servicing Arrangements; See Prospectus - "Management" 17. Brokerage Allocation and Other Practices..................................... Fund Transactions 18. Capital Stock and Other Securities.............. Additional Information Concerning Fund Shares; See Prospectus - "Dividends and Distributions" and "Description of Shares" 19. Purchase, Redemption and Pricing of Securities Being Offered...................... Purchase and Redemption Information; Valuation of Shares; See Prospectus - "How to Purchase Shares" and "How to Redeem Shares" 20. Tax Status...................................... Taxes; See Prospectus - "Taxes" 21. Underwriters.................................... Not Applicable 22. Calculation of Performance Data................. Performance Information 23. Financial Statements............................ Miscellaneous
N/I NUMERIC INVESTORS family of funds N/I NUMERIC INVESTORS Micro Cap Fund CLOSED N/I NUMERIC INVESTORS Growth Fund CLOSED N/I NUMERIC INVESTORS Growth & Value Fund N/I NUMERIC INVESTORS Larger Cap Value Fund -------------------------------------------- advised by NUMERIC INVESTORS LP(R) -------------------------------------------- Prospectus December 9, 1997 NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS OR IN RBB'S STATEMENT OF ADDITIONAL INFORMATION INCORPORATED HEREIN BY REFERENCE, IN CONNECTION WITH THE OFFERING MADE BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY RBB OR ITS DISTRIBUTOR. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING BY RBB OR BY THE DISTRIBUTOR IN ANY JURISDICTION IN WHICH SUCH OFFERING MAY NOT LAWFULLY BE MADE. TABLE OF CONTENTS
PAGE ---- INTRODUCTION............................................................... 2 FINANCIAL HIGHLIGHTS....................................................... 6 INVESTMENT OBJECTIVES AND POLICIES......................................... 7 INVESTMENT LIMITATIONS..................................................... 11 MANAGEMENT................................................................. 12 FUND TRANSACTIONS.......................................................... 14 HOW TO PURCHASE SHARES..................................................... 14 HOW TO REDEEM SHARES....................................................... 17 NET ASSET VALUE............................................................ 19 DIVIDENDS AND DISTRIBUTIONS................................................ 19 TAXES...................................................................... 19 DESCRIPTION OF SHARES...................................................... 20 OTHER INFORMATION.......................................................... 21 APPENDIX A--Performance Benchmarks......................................... A-1
INVESTMENT ADVISER Numeric Investors L.P. Cambridge, Massachusetts CUSTODIAN Custodial Trust Company Princeton, New Jersey CO-ADMINISTRATOR, TRANSFER AGENT AND DIVIDEND DISBURSING AGENT PFPC Inc. Wilmington, Delaware CO-ADMINISTRATOR Bear Stearns Funds Management Inc. New York, New York ADMINISTRATIVE SERVICES AGENT Counsellors Funds Service, Inc. New York, New York DISTRIBUTOR Counsellors Securities Inc. New York, New York COUNSEL Drinker Biddle & Reath LLP Philadelphia, Pennsylvania INDEPENDENT ACCOUNTANTS Coopers & Lybrand L.L.P. Philadelphia, Pennsylvania N/I NUMERIC INVESTORS family of funds of The RBB Fund, Inc. The n/i numeric investors family of funds consists of four classes of common stock of The RBB Fund, Inc. ("RBB"), an open-end management investment company. The shares of each such class (collectively, the "n/i numeric investors family of funds Shares" or "Shares") offered by this Prospectus represent interests in one of four investment portfolios of RBB and are designed to offer a variety of investment opportunities (each such investment portfolio referred to as a "Fund," collectively, the "Funds"). The investment objectives of each investment portfolio described in this Prospectus are as follows: N/I NUMERIC INVESTORS MICRO CAP FUND--to provide long-term capital appreciation. The Fund invests generally in common stock of companies with higher than average earnings growth rates and market capitalization of $500 million or less, although the Fund may invest in companies with higher market capitalization and lower than average growth rates. N/I NUMERIC INVESTORS GROWTH FUND--to provide long-term capital appreciation. The Fund invests generally in common stock of companies with smaller ($1 billion or less) market capitalization, or companies with substantial equity capital and higher than average earnings growth rates. N/I NUMERIC INVESTORS GROWTH & VALUE FUND--to provide long-term capital appreciation. The Fund invests generally in common stock of middle and large market capitalization companies where earnings per share are improving more rapidly than the 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. N/I NUMERIC INVESTORS LARGER CAP VALUE FUND--to provide long-term capital appreciation. The Fund invests generally in common stock of larger ($1 billion or more) market capitalization companies. The stock selection process for this Fund is primarily determined by the fair valuation stock model which seeks to identify companies whose securities have market valuations that are lower than the average market valuations of securities, as measured by such characteristics as price to earnings ratios and price to book ratios. Also considered, but of less importance, is the growth stock model which seeks to identify companies whose earnings per share are improving more rapidly than the earnings per share of the average company. IMPORTANT FUND CLOSING INFORMATION NUMERIC INVESTORS L.P. ("NUMERIC"), THE FUNDS' INVESTMENT ADVISER, WILL MONITOR THE FUNDS' TOTAL ASSETS AND MAY CLOSE ANY OF THE FUNDS AT ANY TIME TO NEW INVESTMENT DUE TO CONCERNS THAT AN INCREASE IN THE SIZE OF A FUND MAY ADVERSELY AFFECT THE IMPLEMENTATION OF NUMERIC'S INVESTMENT STRATEGY. NUMERIC MAY ALSO CHOOSE TO REOPEN A CLOSED FUND TO NEW INVESTMENT AT ANY TIME, AND MAY SUBSEQUENTLY CLOSE SUCH FUND AGAIN SHOULD CONCERNS REGARDING FUND SIZE RECUR. AT THE TIME OF THIS PROSPECTUS, THE N/I NUMERIC INVESTORS MICRO CAP AND GROWTH FUNDS ARE CLOSED TO FURTHER INVESTMENT, EXCEPT AS DESCRIBED ON PAGE 17 HEREOF. IN THE EVENT THAT THE NET ASSETS OF THE N/I NUMERIC INVESTORS GROWTH AND VALUE FUND REACH $200,000,000, THE SALE OF ADDITIONAL SHARES OF THIS FUND WILL ALSO BE RESTRICTED AS DESCRIBED ON PAGE 17 HEREOF. Shares of the n/i numeric investors family of funds are not deposits or obligations of, or guaranteed or endorsed by, PNC Bank, National Association or any other bank and shares are not federally insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other agency. Investments in n/i numeric investors family of funds Shares involve investment risks, including the possible loss of principal. This Prospectus contains information that a prospective investor needs to know before investing. Please keep it for future reference. A Statement of Additional Information, dated December 9, 1997, has been filed with the Securities and Exchange Commission and is incorporated by reference in this Prospectus. The Prospectus and Statement of Additional Information are available for reference, along with other related materials, on the SEC Internet Web Site (http://www.sec.gov). It may also be obtained free of charge by calling (800) NUMERIC [(800) 686-3742]. THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. PROSPECTUS December 9, 1997 INTRODUCTION RBB is registered under the Investment Company Act of 1940 (the "1940 Act") as an open-end management investment company and is currently operating or proposing to operate twenty-two separate investment portfolios. Each of the four classes of Shares offered by this Prospectus represents interests in one of the following four investment portfolios: n/i numeric investors Micro Cap Fund; n/i numeric investors Growth Fund; n/i numeric investors Growth & Value Fund; and n/i numeric investors Larger Cap Value Fund. RBB was incorporated under the laws of the State of Maryland on February 29, 1988. WHO SHOULD INVEST: LONG-TERM INVESTORS SEEKING CAPITAL APPRECIATION The Funds are intended for investors who are seeking long-term capital appreciation, and who do not need to earn current income from their investment in the Funds. The net asset values per share of Shares representing interests in the Funds will fluctuate as the values of the portfolio securities change in response to changing market prices and other factors. Because of the risks associated with common stock investments, the Funds are intended to be a long- term investment vehicle and are not designed to provide investors with a means of speculating on short-term stock market movements. Investors should be able to tolerate sudden, sometimes substantial fluctuations in the value of their investment. Investors who engage in excessive account activity generate additional costs that are borne by all of a Fund's shareholders. In order to minimize such costs, the Funds reserve the right to reject any purchase request (including exchange purchases from other n/i numeric investors Funds) that is reasonably deemed to be disruptive to efficient portfolio management, either because of the timing of the investment or previous excessive trading by the investor. Additionally, the Funds have adopted exchange privilege limitations permitting three exchanges per year as described in the section "Exchange Privilege Limitations." Finally, the Funds reserve the right to suspend the offering of their shares. Because of these risks, the Funds should not be considered a complete investment program. Most investors should maintain diversified holdings of securities with different risk characteristics-- including common stocks, bonds and money market instruments. Investors may wish to purchase shares on a regular, periodic basis (Automatic Investing), rather than investing in one lump sum, in order to reduce the risk of investing all their monies in common stocks at a particularly unfavorable time. Investors may also wish to complement an investment in the Fund with other types of common stock investments. FUND MANAGEMENT Numeric serves as the investment adviser to the Funds. Numeric specializes in the active management of U.S. equity portfolios using internally developed quantitative stock selection and portfolio risk-control techniques, and currently has over $3.8 billion in assets under management for individual, limited partnership, an off-shore fund, mutual fund, pension plan and endowment accounts. THE FUNDS The investment objectives and policies of each of the Funds are summarized in the table below. There is no assurance that a Fund will achieve its investment objective.
N/I NUMERIC INVESTORS INVESTMENT PERFORMANCE FUND OBJECTIVE/POLICY BENCHMARK* - ------------------------------------------------------------------------------- Micro Cap Objective is to provide long-term capital Russell 2000 appreciation. Invests generally in common stock of Growth Index companies with market capitalizations of $500 million or less and higher than average earnings growth rates. - ------------------------------------------------------------------------------- Growth Objective is to provide long-term capital Russell 2500 appreciation. Invests generally in common stock of Growth Index companies with smaller ($1 billion or less) market capitalization or companies with substantial equity capital and higher than average earnings growth rates. - ------------------------------------------------------------------------------- Growth & Objective is to provide long-term capital S&P MidCap Value appreciation. Invests generally in common stocks of 400 Index middle and large market capitalization companies where earnings per share are improving more rapidly than the 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.
2
N/I NUMERIC INVESTORS INVESTMENT PERFORMANCE FUND OBJECTIVE/POLICY BENCHMARK* - ------------------------------------------------------------------------------- Larger Cap Objective is to provide long-term capital Russell 1000 Value appreciation. The Fund invests generally in common Value Index stock of larger ($1 billion or more) market capitalization companies. The stock selection process for this Fund is primarily determined by the fair valuation stock model which seeks to identify companies whose securities have market valuations that are lower than the average market valuations of securities, as measured by such characteristics as price to earnings ratios and price to book ratios. Also considered, but of less importance, is the growth stock model which seeks to identify companies whose earnings per share are improving more rapidly than the earnings per share of the average company.
- -------- * For more information on a Fund's benchmark, see Appendix A at the back of this prospectus. FEE TABLE The following tables illustrate all expenses and fees (after expected fee waivers and expense reimbursements) that a shareholder would incur in each Fund. The expenses and fees in the tables for the n/i numeric investors Micro Cap, Growth and Growth & Value Funds are based on expenses incurred for the fiscal year ended August 31, 1997. The expenses and fees in the tables for the n/i numeric investors Larger Cap Value Fund are based on expenses expected to be incurred in the current fiscal period. SHAREHOLDER TRANSACTION EXPENSES Maximum Sales Charge Imposed on Purchases (as percentage of offering price) NONE Sales Charge Imposed on Reinvested Dividends NONE Redemption Fees NONE Exchange Fees/1/ NONE
- -------- 1 Exchanges are limited to three (3) per year. See "How to Purchase Shares-- Exchange Privilege Limitations." Annual Fund Operating Expenses (as a percentage of average net assets)
GROWTH LARGER MICRO & CAP CAP GROWTH VALUE VALUE FUND FUND FUND FUND ----- ------ ------ ------ Management Fees (after waivers)/1/................................. .51% .52% .37% 0% 12b-1 Fees.......................................... None None None None Other Expenses (after waivers and reimburse ments)/1/.......................................... .49% .48% .63% 1.00% ---- ---- ---- ---- Total Fund Operating Expenses, (after waivers and reimburse ments)/1/.......................................... 1.00% 1.00% 1.00% 1.00% ==== ==== ==== ====
- -------- 1. Before expense reimbursements and waivers, Management Fees would be 0.75% for each of the four Funds, Other Expenses would be .70% for the Micro Cap Fund, .65% for the Growth Fund, 1.06% for the Growth & Value Fund and are expected to be 1.01% for the Larger Cap Value Fund. Total Fund Operating Expenses would be 1.45% for the Micro Cap Fund, 1.40% for the Growth Fund, 1.81% for the Growth & Value Fund and are expected to be 1.76% for the Larger Cap Value Fund. EXAMPLE An investor would pay the following expenses on a $1,000 investment in each of the Funds, assuming (1) a 5% annual return, and (2) redemption at the end of each time period:
ONE THREE FIVE TEN YEAR YEARS YEARS YEARS ---- ----- ----- ----- Micro Cap................................................ $10 $32 $55 $122 Growth................................................... $10 $32 $55 $122 Growth & Value........................................... $10 $32 $55 $122 Larger Cap Value......................................... $10 $32 $55 $122
The Examples in the Fee Table assume that all dividends and distributions are reinvested and that the amounts listed under "Annual Fund Operating Expenses" remain the same in the years shown. THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE INVESTMENT RETURN OR OPERATING EXPENSES AND ACTUAL INVESTMENT RETURN OR OPERATING EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN. The Fee Table is designed to assist an investor in understanding the various costs and expenses that an 3 investor in any of the n/i numeric investors family of funds Classes of RBB will bear directly or indirectly. (For more complete descriptions of the various costs and expenses, see "Management" and "Distribution of Shares" below.) The Fee Table reflects expense reimbursements and a voluntary waiver of Management Fees for each Fund through the current fiscal year. There can be no assurance that any future expense reimbursements and waivers (if any) of Management Fees will not vary from the figures reflected in the Fee Table. In addition, Numeric is expected to voluntarily assume additional expenses of the Larger Cap Value Fund. There can be no assurance that Numeric will continue to assume such expenses. Assumption of additional expenses will have the effect of lowering a Fund's overall expense ratio and increasing its yield or total return to investors. "Other Expenses" for the Funds are based on estimated amounts for the current fiscal year. OFFERING PRICES Shares of the n/i numeric investors Growth & Value Fund and the n/i numeric investors Larger Cap Value Fund are offered to the public. Shares of the n/i numeric investors Micro Cap Fund and the n/i numeric investors Growth Fund are offered only to certain persons described under "How to Purchase Shares-- Closing of Funds." Purchase orders receive the next determined net asset value after receipt of an order in proper form by PFPC Inc. ("PFPC"), the Funds' transfer agent. THE SHARES ARE OFFERED ON A NO-LOAD BASIS: THERE IS NO SALES CHARGE IMPOSED ON PURCHASES OF SHARES, NOR ARE THE SHARES SUBJECT TO A DISTRIBUTION ("12B-1") FEE. MINIMUM INITIAL AND SUBSEQUENT INVESTMENTS The minimum initial investment for each Fund is $3,000. Subsequent investments must be $100 or more. The minimum initial investment for an Automatic Investment Plan is $1,000 with minimum monthly payments of $100. The minimum investment for Individual Retirement Accounts ("IRAs"), or pension, profit- sharing or other employee benefit plans is $1,000 and minimum subsequent investments are $100. See "How to Purchase Shares." EXCHANGES Shares of a n/i numeric investors family of funds may be exchanged up to three (3) times per year for Shares of the n/i numeric investors Growth & Value Fund or the n/i numeric investors Larger Cap Value Fund at the net asset value next determined after receipt by PFPC of an exchange request. In addition, RBB reserves the right to impose an administrative charge for each exchange or to reject any exchange request that is reasonably deemed to be disruptive to efficient portfolio management. See "How to Purchase Shares--Exchange Privilege" and "Exchange Privilege Limitation." REDEMPTION PRICE Shares generally may be redeemed at any time at their net asset value next determined after receipt by PFPC of a redemption request. RBB reserves the right, upon 30 days' written notice, to redeem an account in any of the Funds if the net asset value of the investor's Shares in that account falls below $500 and is not increased to at least such amount within such 30-day period. See "How to Redeem Shares." RISK FACTORS TO CONSIDER An investment in any of the Funds is subject to certain risks, as set forth in detail under "Investment Objectives and Policies." As with other mutual funds, there can be no assurance that any Fund will achieve its objective. Some or all of the Funds, to the extent set forth under "Investment Objectives and Policies," may engage in the following investment practices: short sales, borrowings, the lending of portfolio securities, engaging in options and futures transactions and investments in micro-cap and small cap issuers. All of these transactions involve certain special risks, as set forth under "Investment Objectives and Policies." In addition, the Funds may be subject to high portfolio turnover rates. See "Investment Objectives and Policies-- Portfolio Turnover" and "Taxes." 4 SHAREHOLDER INQUIRIES For questions regarding shareholder accounts, call toll-free: 1-800-348-5031. Any questions regarding (i) new or existing accounts or (ii) purchases or redemptions should be directed to PFPC by writing to it at: n/i numeric investors family of funds c/o PFPC Inc. Bellevue Park Corporate Center 400 Bellevue Parkway Wilmington, Delaware 19809 For overnight deliveries: n/i numeric investors family of funds c/o PFPC Inc. Bellevue Park Corporate Center 400 Bellevue Parkway, Suite 108 Wilmington, Delaware 19809 or by calling PFPC toll-free at: 1-800-348-5031. To request a prospectus, call toll-free: 1-800 NUMERIC [1-800-686-3742]. For any other questions, call toll-free: 1-800-NUMERIC [1-800-686-3742]. To reach Numeric and the Funds on the Internet: Information is available on the Internet through the World Wide Web. Shareholders and investment professionals may obtain information on Numeric and the Funds by accessing: http://www.numeric.com To reach Numeric through e-mail: info@numeric.com This Column intentionally left blank. 5 FINANCIAL HIGHLIGHTS Contained below is per share operating performance data for each share outstanding, total investment return, ratios to average net assets and other supplemental data for the period from commencement of operations (June 3, 1996) through August 31, 1996 and for the fiscal year ended August 31, 1997. The financial data included in this table should be read in conjunction with the financial statements and related notes contained in the Annual Report to Shareholders and incorporated by reference in the Statement of Additional Information. No financial information has been provided with respect to the n/i numeric investors Larger Cap Value Fund because it had not commenced operations as of August 31, 1997.
MICRO GROWTH CAP GROWTH & VALUE FUND FUND FUND --------------------- --------------------- -------------------- FISCAL YEAR PERIOD FISCAL YEAR PERIOD FISCAL YEAR PERIOD ENDED ENDED ENDED ENDED ENDED ENDED 8/31/97 8/31/96* 8/31/97 8/31/96* 8/31/97 8/31/96* ----------- -------- ----------- -------- ----------- -------- PER SHARE OPERATING PERFORMANCE** Net asset value, $ 11.67 $ 12.00 $ 11.84 $ 12.00 $ 11.56 $ 12.00 beginning of period.... -------- ------- -------- ------- ------- ------- Net investment income (0.01) 0.01 (0.04) 0.01 0.08 0.03 (loss)(1).............. Net realized and unrealized gain (loss) on investments(2)...... 6.82 (0.34) 4.50 (0.17) 5.58 (0.47) -------- ------- -------- ------- ------- ------- Net increase (decrease) in net assets resulting from operations........ 6.81 (0.33) 4.46 (0.16) 5.66 (0.44) -------- ------- -------- ------- ------- ------- Dividends to Shareholders from net investment income...... (0.01) -- (0.01) -- (0.06) -- -------- ------- -------- ------- ------- ------- Net asset value, end of period................. $ 18.47 $ 11.67 $ 16.29 $ 11.84 $ 17.16 $ 11.56 ======== ======= ======== ======= ======= ======= Total investment 58.41% (2.75)% 37.69% (1.33)% 49.11% (3.67)% return(3).............. ======== ======= ======== ======= ======= ======= RATIOS/SUPPLEMENTAL DATA Net assets, end of $142,119 $14,100 $117,724 $26,756 $52,491 $ 3,813 period (000's omitted)............... Ratio of expenses to average net assets(1)(4)........... 1.00% 1.00%*** 1.00% 1.00%*** 1.00% 1.00%*** Ratio of net investment income (loss) to average net assets(1).. (0.06)% 0.73%*** (0.38)% 0.71%*** 0.79% 1.89%*** Portfolio turnover 233.49% 42.92%**** 266.25% 19.21%**** 263.83% 5.25%**** rate................... Average commission rate $ 0.0327 $0.0339 $ 0.0397 $0.0365 $0.0369 $0.0363 per share(5)...........
- -------- * These Funds commenced operations on June 3, 1996. ** Calculated based on shares outstanding on the first and last day of the period, except for dividends and distributions, if any, which are based on actual shares outstanding on the dates of distributions. *** Annualized. **** Not annualized. (1) Reflects waivers and reimbursements. (2) The amount shown for a share outstanding throughout the respective periods is not in accord with the changes in the aggregate gains and losses in investments during the respective periods because of the timing of sales and repurchases of Fund shares in relation to fluctuating net asset value during the periods. (3) 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. (4) Without the waiver of advisory, administration and transfer agent fees and without the reimbursement of certain operating expenses, the ratio of expenses to average net assets annualized for the periods ended August 31, 1997 and August 31, 1996, respectively, would have been 1.45% and 3.45% for Micro Cap Fund, 1.40% and 2.62% for the Growth Fund, and 1.81% and 8.98% for the Growth & Value Fund. (5) Computed by dividing the total amount of commissions paid by the total number of shares purchased and sold during the periods subject to such commissions. 6 INVESTMENT OBJECTIVES AND POLICIES To meet its investment objective, each Fund employs a specific investment style, as described below. There is no assurance that a Fund will achieve its investment objective. The investment objective of the n/i numeric investors Micro Cap Fund is to provide long-term capital appreciation. The Fund invests generally in common stocks, although it may also invest in securities which are convertible into common stock, fixed income securities and money market securities. Under normal circumstances, the Fund invests at least 65% of its total assets in common stock of companies with market capitalization of $500 million or less, although the Fund may invest in companies with higher market capitalization. Numeric determines its stock selection decisions for this Fund primarily on the basis of its growth stock model, which seeks to identify companies whose earnings per share are improving more rapidly than the earnings per share of the average company. Considered, but of significantly less importance, is the fair valuation stock model, Fair Value, which seeks to identify companies whose securities have market valuations that are lower than the average market valuations of securities, as measured by characteristics including price to earnings ratios and price to book ratios. The Fund measures its performance against the Russell 2000 Growth Index. The investment objective of the n/i numeric investors Growth Fund is to provide long-term capital appreciation. The Fund invests generally in common stocks, although it may also invest in securities which are convertible into common stock, fixed income securities and money market securities. Under normal circumstances, the Fund invests in common stock of companies with smaller ($1 billion or less) market capitalization or companies with substantial equity capital and higher than average earnings growth rates. Numeric determines its stock selection decisions for this Fund primarily on the basis of its growth stock model, which seeks to identify companies whose earnings per share are improving more rapidly than the earnings per share of the average company. Considered, but of significantly less importance, is the Fair Value model, which seeks to identify companies whose securities have market valuations that are lower than the average market valuations of securities, as measured by characteristics including price to earnings ratios and price to book ratios. The Fund will measure its performance against the Russell 2500 Growth Index. The investment objective of the n/i numeric investors Growth & Value Fund is to provide long-term capital appreciation. The Fund invests generally in common stocks of middle and large market capitalization companies where 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. 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 growth stock model and its Fair Value stock model. The growth stock model seeks to identify companies whose earnings per share are improving more rapidly than the earnings per share of the average company. The Fair Value stock model seeks to identify companies whose securities have market valuations that are lower than the average market valuation of securities, as measured by characteristics including price to earnings ratios and price to book ratios. The Fund anticipates that it will invest a large portion 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 Depository Receipts ("ADRs")) as ranked by market capitalization. The market capitalization of the 1000th largest company is approximately $1.1 billion. The Fund will measure its performance against the S&P MidCap 400 Index. The investment objective of the n/i numeric investors Larger Cap Value Fund is to provide long-term capital appreciation. The Fund invests generally in common stock of larger ($1 billion or more) market capitalization companies, although it may also invest in middle capitalization companies and securities which are convertible into common stock, fixed income securities and money market securities. Under normal circumstances, the Fund invests at least 65% of its total assets in common stock of companies with a market capitalization of $1 billion or more. Numeric determines its stock selection decisions for this Fund primarily on the basis of its Fair Value stock model which seeks to identify companies whose securities have market valuations 7 that are lower than the average market valuations of securities, as measured by such characteristics as price to earnings ratios and price to book ratios. Also considered, but of less importance, is the growth stock model which seeks to identify companies whose earnings per share are improving more rapidly than the earnings per share of the average company. The Fund anticipates that it will invest a large portion of its total assets in common stock of the 1000 largest companies (excluding ADRs) as ranked by market capitalization. The market capitalization of the 1000th largest company is approximately $1.1 billion. The Fund will measure its performance against the Russell 1000 Value Index. NUMERIC'S INVESTMENT STYLE. Numeric employs a quantitative approach to investment management. Numeric relies on proprietary quantitative computer models utilizing internally developed computer technology and financial databases to assist in the stock selection process. Numeric's proprietary models are capable of ranking a large universe of eligible investments using a wide array of financial data such as market price, book value, earnings, cash flow and earnings growth rates. The models also evaluate the degree to which independent research analysts are changing their earnings forecasts for the companies they follow. The models are broadly classified into two types: Numeric's value stock model, Fair Value, seeks to identify companies whose securities have market valuations that are lower than the average market valuation of securities, as measured by characteristics including price to earnings ratios and price to book ratios; Numeric's growth stock model, Estrend(TM), seeks to identify companies whose earnings per share are improving more rapidly than the earnings per share of the average company. Stocks are ranked according to their relative attractiveness as determined by these models. These rankings assist Numeric in constructing a portfolio it believes is invested in the most attractive securities consistent with a Fund's investment objectives. The same investment strategy used to manage a particular Fund also may be used for institutional accounts managed by Numeric. These models may be changed periodically to capture the insights of Numeric's ongoing research efforts. In pursuing the investment objectives of each of the Funds, Numeric may use the investment instruments and techniques discussed below: 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. OPTIONS AND FUTURES. The Funds may write covered call options, buy put options, buy call options and write put options, without limitation except as noted in this paragraph. Such options may relate to particular securities or to various indexes and may or may not be listed on a national securities exchange 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. 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 he 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 8 Corporation, which performs the obligations of its members who fail to do so in connection with the purchase or sale of options. To enter into a futures contract, the Funds must make a deposit of an initial margin with their custodian in a segregated account in the name of the futures broker. Subsequent payments to or from the broker, called variation margin, will be made on a daily basis as the price of the underlying security or index fluctuates, making the long and short positions in the futures contracts more or less valuable. The risks related to the use of options and futures contracts include: (i) the correlation between movements in the market price of a Fund's investments (held or intended for purchase) being hedged and in the price of the futures contract or option may be imperfect; (ii) possible lack of a liquid secondary market for closing out options or futures positions; (iii) the need for additional portfolio management skills and techniques; and (iv) losses due to unanticipated market movements. Successful use of options and futures by the Funds is 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. For a further discussion see "Investment Objectives and Policies" in the Statement of Additional Information. SHORT SALES. Short sales are transactions in which a Fund sells a security it does not own in anticipation of a decline in the market value of that security. To complete such a transaction, the Fund must borrow the security to make delivery to the buyer. The Fund then is obligated to replace the security borrowed by purchasing it at the market price at the time of replacement. The price at such time may be more or less than the price at which the security was sold by the Fund. Until the security is replaced, the Fund is required to pay to the lender amounts equal to any dividend which accrues during the period of the loan. To borrow the security, the Fund also may be required to pay a premium, which would increase the cost of the security sold. The proceeds of the short sale will be retained by the broker, to the extent necessary to meet margin requirements, until the short position is closed out. Until a Fund replaces a borrowed security in connection with a short sale, the Fund will: (a) maintain daily a segregated account, containing cash, cash equivalents, or 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. The Fund may purchase call options to provide a hedge against an increase in the price of a security sold short by the Fund. See "Options and Futures Contracts" above. The Funds anticipate that the frequency of short sales will vary substantially in different periods, and they do not intend that any specified portion of their assets, as a matter of practice, will be invested in short sales. However, no securities will be sold short if, after effect is given to any such short sale, the total market value of all securities sold short would exceed 25% of the value of a Fund's net assets. 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 9 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. 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. PORTFOLIO TURNOVER. The Funds may be subject to a greater degree of turnover and thus a higher incidence of short-term capital gains taxable as ordinary income than might be expected from portfolios which invest substantially all of their funds on a long-term basis, and correspondingly larger brokerage charges and other transaction costs can be expected to be borne by such Funds. The Larger Cap Value Fund anticipates that its annual turnover will range from 150% to 300% depending on market conditions. Such turnover rates are greater than that of many other investment companies. The portfolio turnover rates for the other Funds for the period ended August 31, 1996 and for the fiscal year ended August 31, 1997 are set forth above in the financial highlights on page 6. MICRO CAP AND SMALL CAP STOCKS. Securities of companies with micro and small capitalizations tend to be riskier than securities of companies with medium or large capitalizations. This is because micro and small cap companies typically have smaller product lines and less access to liquidity than mid cap or large cap companies, and are therefore more sensitive to economic downturns. In addition, growth prospects of micro and small cap companies tend to be less certain than mid or large cap companies, and the dividends paid on micro and small cap stocks are frequently negligible. Moreover, micro and small cap stocks have, on occasion, fluctuated in the opposite direction of large cap stocks or the general stock market. Consequently, securities of micro and small cap companies tend to be more volatile than those of mid and large cap companies. BORROWING MONEY. As a fundamental policy, the Funds are permitted to borrow to the extent permitted under the 1940 Act and to mortgage, pledge or hypothecate their respective assets in connection with such borrowings in amounts not in excess of 125% of the dollar amounts borrowed. The 1940 Act permits an investment company to borrow in an amount up to 33 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. While borrowings exceed 5% of its total assets, the Funds will not make any additional investments. DEBT SECURITIES. The Funds may invest in debt securities rated no less than investment grade by either Standard & Poor's 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. MARKET FLUCTUATION. Because the investment alternatives available to each Fund may be limited by specific objectives of that Fund, investors should be aware that an investment in a particular Fund may be subject to greater market fluctuation than an investment in a portfolio of securities representing a 10 broader range of investment alternatives. In view of the specialized nature of the investment activities of each Fund, an investment in any single fund should not be considered a complete investment program. There is no assurance that any Fund will achieve its investment objectives. 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. 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 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. OTHER INVESTMENT INSTRUMENTS AND TECHNIQUES. In addition to the above investment instruments and techniques, the Funds presently intend to invest not more than 5% of a Fund's net assets in when-issued and forward commitments, illiquid securities, depositary receipts, investment company securities and convertible securities. These investment instruments and techniques and related risks are described in greater detail in the Funds' Statement of Additional Information under "Investment Objectives and Policies." The Funds' investment objectives and policies described above may be changed by RBB's Board of Directors without 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 No Fund may change the following investment limitations (with certain exceptions, as noted below) without shareholder approval. (A complete list of the investment limitations that cannot be changed without such a vote of the shareholders is contained in the Statement of Additional Information under "Investment Objectives and Policies.") THE FUNDS MAY NOT: 1. Purchase the securities of any one issuer, other than securities issued or guaranteed by the U.S. Government or its agencies or instrumentalities, if immediately after and as a result of such purchase more than 5% of the value of a Fund's total assets would be invested in the securities of such issuer, or more than 10% of the outstanding voting securities of such issuer would be owned by the Fund, except that up to 25% of the value of the Fund's total assets may be invested without regard to such limitations. 2. Borrow money, except to the extent permitted under the 1940 Act or mortgage, pledge or hypothecate any of their respective assets in connection with any such borrowing except in amounts not in excess of 125% of the dollar amounts borrowed. For purposes of this investment restriction, the entry into options, forward contracts, futures contracts, including those relating to indexes, and options on futures contracts or indexes shall not constitute borrowing. 3. Purchase any securities which would cause, at the time of purchase, 25% or more of the value of the total assets of a Fund to be invested in the obligations of issuers in any industry, provided that there is no limitation with respect to investments in U.S. Government obligations. 4. Make loans, except that a Fund may purchase or hold debt obligations in accordance with its investment objective, policies and limitations, may enter into repurchase agreements for securities, and may lend portfolio securities against collateral consisting of cash or securities which are consistent with the Fund's permitted investments, which is equal at all times to at least 100% of the value of the 11 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. In determining whether the Funds have complied with limitation 3 above, the Funds will not take into account the value of options and futures. These investment limitations are applied at the time investment securities are purchased (except that, with respect to borrowings, if asset coverage falls below 300%, a Fund will reduce its borrowing to restore asset coverage to 300% within three business days in accordance with the requirements of the 1940 Act). In order to permit the sale of its shares in certain states, the Funds may make commitments more restrictive than the investment policies and limitations described in this Prospectus. If the Funds determine that any commitment is no longer in the best interests of the Funds, they will revoke the commitment by terminating sale of shares of the Funds in the state involved. MANAGEMENT BOARD OF DIRECTORS The business and affairs of RBB and the Funds are managed under the direction of RBB's Board of Directors. INVESTMENT ADVISER Numeric Investors L.P. serves as investment adviser to the Funds. Numeric, whose principal business address is One Memorial Drive, Cambridge, Massachusetts 02142, was organized in October 1989 as a Delaware limited partnership. The firm, which specializes in the active management of U.S. equity portfolios using internally developed quantitative stock selection and portfolio risk-control techniques, currently has over $3.8 billion in assets under management for individuals, limited partnership, mutual fund, an offshore fund, pension plan and endowment accounts. Langdon B. Wheeler, CFA is the founder of Numeric. Mr. Wheeler received his MBA from Harvard University and an undergraduate degree from Yale University. Management of the n/i numeric investors family of funds is directed by John C. Bogle, Jr., CFA, Director of Portfolio Management, with day-to-day investment decisions made by Mr. Bogle and his team. The team includes: Steven Cusimano, CFA; Arup K. Datta, CFA and Shannon Vanderhooft, CFA. Mr. Bogle joined Numeric in 1990 after serving as Vice President and Portfolio Manager at State Street Global Advisors. Mr. Bogle received his MBA and BS from Vanderbilt University. Messrs. Wheeler, Bogle and Mark F. Engerman, CFA are active in the development and implementation of the firm's stock selection models. Mr. Engerman joined Numeric in 1994 and is the Co-Director of Research and Portfolio Manager. Before joining Numeric, Mr. Engerman was the manager of Valuation Services at BARRA Inc. Prior to joining BARRA, Mr. Engerman worked for two years as a quantitative analyst for the Prudential Investment Corporation. Mr. Engerman received his BS in Applied Mathematics and economics from Brown University. Mr. Cusimano joined Numeric in 1997, and is responsible for assisting in the management of all Funds. Prior to joining Numeric, Mr. Cusimano was an Investment Strategist and Principal at Barclays Global Investors. Prior to joining Barclays, Mr. Cusimano was a manager of all quantitative and equity index strategies at the Florida Retirement System. Mr. Cusimano has his BSBA in Finance from the University of Florida. Mr. Datta joined Numeric in 1993 and manages the assets of the n/i numeric investors Growth & Value Fund and the n/i numeric investors Larger Cap Value Fund under the direction of Mr. Bogle. Mr Datta also assists in the management of the n/i numeric investors Micro Cap Fund. Prior to 1993, Mr. Datta was employed at The New England Financial Group as a personal financial advisor. Mr. Datta received his MBA from Cornell University and a B.Tech in Electrical Engineering from the Indian Institute of Technology in Kanpur, India. Ms. Vanderhooft joined Numeric in 1990 and manages the n/i numeric investors Growth Fund's assets under the direction of Mr. Bogle. Ms. Vanderhooft received her BA in Religious Studies from Indiana University. The general partner of Numeric is WBE & Associates, LLC, a Delaware limited liability company. The principal officers of WBE & Associates, LLC are Messrs. Wheeler and Bogle. 12 For the services provided and the expenses assumed by it, Numeric is entitled to receive a fee from each of the Funds at an annual rate of 0.75% of a Fund's average daily net assets, computed daily and payable monthly. Numeric may from time to time voluntarily agree to waive all or any portion of its advisory fees. Numeric presently intends to waive its fees for the current fiscal year and for the following fiscal year to the extent necessary to maintain an annualized expense ratio for each Fund of 1.00%, although there is no guarantee that Numeric will maintain such waivers indefinitely. For the Funds' fiscal year ended August 31, 1997, Numeric waived investment advisory fees earned with respect to the n/i numeric investors Micro Cap Fund, n/i numeric investors Growth Fund and n/i numeric investors Growth & Value Fund in the amounts of 0.24%, 0.23% and 0.38%, respectively, of the average daily net assets of the Funds. For the n/i numeric investors Micro Cap Fund, n/i numeric investors Growth Fund, and n/i numeric investors Growth & Value Fund, RBB paid Numeric investment advisory fees of 0.51%, 0.52% and 0.37%, respectively, of average daily net assets of each Fund. CO-ADMINISTRATORS Bear Stearns Funds Management Inc. ("BSFM"), an affiliate of Bear, Stearns & Co. Inc. ("Bear Stearns"), serves as co-administrator to the Funds. BSFM's principal business address is 245 Park Avenue, 15th Floor, New York, New York 10167. BSFM generally assists each of the Funds in all aspects of their administration and operations. For its services, BSFM is entitled to a monthly fee calculated at the annual rate of .05% of the first $150 million of each Fund's average daily net assets and .02% on average daily net assets in excess of $150 million. PFPC, an indirect wholly-owned subsidiary of PNC Bank, N.A. ("PNC"), also serves as co-administrator to the Funds. PFPC's principal business address is Bellevue Corporate Center, 400 Bellevue Parkway, Wilmington, Delaware 19809. PFPC assists the Funds in matters relating to the maintenance of financial records and accounting. For its services, PFPC is entitled to a fee calculated at the annual rate of .125% of each Fund's average daily net assets. PFPC is currently waiving fees in excess of .115% of each Fund's average daily net assets. ADMINISTRATIVE SERVICES AGENT Counsellors Funds Service, Inc. ("Counsellors Service"), a wholly-owned subsidiary of Warburg Pincus Asset Management, Inc. ("Warburg"), provides certain administrative services to the Funds not otherwise provided by BSFM or PFPC. Counsellors Service's principal business address is 466 Lexington Avenue, New York, New York 10017. Counsellors Service furnishes certain internal quasi-legal, executive and administrative services to the Funds, acts as a liaison between the Funds and their various services providers and coordinates and assists in the preparation of proxy statements and reports prepared on behalf of the Funds. For its services, Counsellors Service is entitled to a monthly fee calculated at the annual rate of .15% of each Fund's average daily net assets. Counsellors Service is currently waiving fees in excess of .03% of each Fund's average daily net assets. TRANSFER AGENT AND DIVIDEND DISBURSING AGENT PFPC serves as the Funds' transfer agent and dividend disbursing agent. The services provided and the fees payable by the Funds for these services are described in the Statement of Additional Information under "Investment Advisory, Distribution and Servicing Arrangements." CUSTODIAN Custodial Trust Company ("CTC"), an affiliate of Bear Stearns, serves as custodian for the Funds. The services provided and the fees payable by the Funds for these services are described in the Statement of Additional Information under "Investment Advisory, Distribution and Servicing Arrangements." DISTRIBUTOR Counsellors Securities Inc. (the "Distributor"), a wholly-owned subsidiary of Warburg, with a principal business address at 466 Lexington Avenue, New York, New York, acts as distributor for each of the Funds pursuant to separate distribution agreements (collectively, the "Distribution Agreements") with RBB on behalf of each of the Funds. EXPENSES The expenses of each Fund are deducted from its total income before dividends are paid. Any general 13 expenses of RBB that are not readily identifiable as belonging to a particular investment portfolio of RBB will be allocated among all investment portfolios of RBB based upon the relative net assets of the investment portfolios at the time such expenses are cited. Numeric may assume additional expenses of the Funds from time to time. In certain circumstances, Numeric may assume such expenses on the condition that it is reimbursed by the Funds for such amounts prior to the end of a fiscal year. In such event, the reimbursement of such amounts, will have the effect of increasing a Fund's expense ratio and of decreasing the total return or yield to investors. For the Fund's fiscal year ended August 31, 1997, the n/i numeric investors Micro Cap Fund's total expenses were 1.45% of average net assets (before waivers and reimbursements of 0.45%), the n/i numeric investors Growth Fund's total expenses were 1.40% of average net assets (before waivers and reimbursements of 0.40%) and the n/i numeric investors Growth & Value Fund's total expenses were 1.81% of average net assets (before waivers and reimbursements of 0.81%). The inception date of the n/i numeric investors Larger Cap Value Fund is subsequent to August 31, 1997. FUND TRANSACTIONS Numeric may consider a number of factors in determining which brokers to use in purchasing or selling a Fund's securities. These factors, which are more fully discussed in the Statement of Additional Information, include, but are not limited to, research services, the reasonableness of commissions and quality of services and execution. A higher rate of turnover (100% or more) of a Fund's securities may involve correspondingly higher transaction costs, which will be borne directly by the Fund. A Fund may enter into brokerage transactions with and pay brokerage commissions to brokers that are affiliated persons (as such term is defined in the 1940 Act) provided that the terms of the brokerage transactions comply with the provisions of the 1940 Act. Numeric may allocate trades among any or all of its clients, including the Funds. Numeric combines orders and allocates to each account its proportionate or "pro rata" share of the trade. Accounts included in the trade allocation may include limited partnerships for which Numeric serves as general partner and in which employees and/or partners of Numeric may own a substantial interest. Numeric may cause the Funds to pay brokerage commissions which may be in excess of the lowest rates available to brokers who execute transactions for the Funds or who otherwise provide brokerage and research services utilized by Numeric, provided that Numeric determines in good faith that the amount of each such commission paid to a broker is reasonable in relation to the value of the brokerage viewed in terms of either the particular transaction to which the commission relates or Numeric's overall responsibilities with respect to the Funds. HOW TO PURCHASE SHARES GENERAL Shares representing interests in the Funds are offered continuously (subject to closure of the Funds as described on page 17) for sale by the Distributor and may be purchased without imposition of a sales charge through PFPC, the Funds' transfer agent. Shares may be purchased initially by completing the application included in this Prospectus and forwarding the application and payment to PFPC. Subsequent purchases of Shares may be effected by mailing a check or Federal Reserve Draft payable to the order of "n/i numeric investors funds" to n/i numeric investors family of funds, c/o PFPC, P.O. Box 8966, Wilmington, Delaware 19899-8966. The name of the Fund for which Shares are being purchased must also appear on the check or Federal Reserve Draft. Federal Reserve Drafts are available at national banks or any state bank which is a member of the Federal Reserve System. Initial investments in any Fund must be at least $3,000 and subsequent investments must be at least $100. The minimum initial investment for an Automatic Investment Plan is $1,000 with minimum monthly payments of $100. RBB reserves the right to reject any purchase order or to waive the minimum initial or subsequent investment requirement. Investors will be given notice of any increase in minimum investment requirements. Provided that the investment is at least $2,500, an investor may also purchase Shares by having his bank or his broker wire Federal Funds to PFPC. An investor's bank or broker may impose a charge for this service. The Funds do not currently impose a sales charge for effecting wire transfers but reserve 14 the right to do so in the future. In order to ensure prompt receipt of an investor's Federal Funds wire, for an initial investment, it is important that an investor follows these steps: A. Telephone the Funds' transfer agent, PFPC, toll-free at (800) 348-5031, and provide your name, address, telephone number, Social Security or Tax Identification Number, the Fund selected, the amount being wired, and by which bank or broker. PFPC will then provide an investor with a Fund account number. Investors with existing accounts should also notify PFPC prior to wiring funds. B. Instruct your bank or broker to wire the specified amount, together with your assigned account number, to PFPC's account with PNC: PNC Bank, N.A. ABA-0310-0005-3 CREDITING ACCOUNT NUMBER: 86-1108-2312 FROM: (name of investor) ACCOUNT NUMBER: (investor's account number with the Fund) FOR PURCHASE OF: (name of the Fund) AMOUNT: (amount to be invested) C. Fully complete and sign the Application and mail it to the address shown thereon. PFPC will not process initial purchases until it receives a completed and signed Application. For subsequent investments, an investor should follow steps A and B above. Shares of the Funds may be purchased on any Business Day. A "Business Day" is any day that the New York Stock Exchange (the "NYSE") is open for business. Currently, the NYSE is closed on weekends and New Year's Day, Dr. Martin Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day and the preceding Friday or subsequent Monday when one of those holidays falls on a Saturday or Sunday. The price paid for a Fund's Shares purchased initially or acquired through the exercise of an exchange privilege is based on the net asset value next computed after a purchase order is received in good order by PFPC, provided such order is transmitted to and received by PFPC prior to the close of regular trading on the NYSE (generally 4:00 p.m. Eastern Time) on such day. Orders received by PFPC after the close of regular trading on the NYSE are priced at the net asset value next determined on the following Business Day. In those cases where an investor pays for Shares by check, the purchase will be effected at the net asset value next determined after PFPC receives payment in good order. Shareholders whose shares are held in a street name account and who desire to transfer such shares to another street name account should contact the record holder of their current street name account. Some broker-dealers (other than the Distributor), financial institutions, financial planners and other industry professionals ("Service Agents") may impose certain conditions on their clients who invest in the Funds such as initial and subsequent minimums and certain trading restrictions, which are in addition to or different from those described in this Prospectus. Service Agents may impose transaction or administrative charges or other direct fees, which charges and fees would not be imposed if Fund shares are purchased directly from a Fund. Therefore, a client or customer should contact the organization acting on his behalf concerning the fees (if any) charged in connection with a purchase or redemption of a Fund's shares and should read this Prospectus in light of the terms governing his accounts with Service Agents. Service Agents will be responsible for promptly transmitting client or customer purchase and redemption orders to the Funds in accordance with their agreements with clients or customers. Service Agents or, if applicable, their designees, that have entered into agreements with a Fund or its agent may enter confirmed purchase or redemption orders on behalf of clients and customers, with payment to follow no later than the Funds' pricing on the following Business Day. If payment is not received by such time, the Service Agent could be held liable for resulting fees or losses. A Fund may be deemed to have received a purchase or redemption order when a Service Agent, or, if applicable, its authorized designee, accepts the order. Orders received by a Fund in proper form will be priced at the Fund's net asset value next computed after they are accepted by the Service Agent or its authorized designee. AUTOMATIC INVESTMENT PLAN Additional investments in Shares of the Funds may be made automatically by authorizing PFPC to withdraw funds from your bank account through an Automatic Investment Plan. Investors desiring to participate in an Automatic Investment Plan should call PFPC at (800) 348-5031 to obtain the appropriate 15 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. RETIREMENT PLANS n/i numeric investors family of funds Shares 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. 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. In addition, RBB reserves the right to impose a $5.00 administrative fee for each exchange. An exchange of Shares will be treated as a sale for federal income tax purposes. See "Taxes." A shareholder wishing to make an exchange may do so by sending a written request to PFPC. 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. 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 Agents Medallion Program (STAMP), Stock Exchanges Medallion Program (SEMP) and New York Stock Exchange, Inc. Medallion Signature Program (MSP). Signature guarantees which are not a part of these programs will not be accepted. The exchange privilege may be modified or terminated at any time, or from time to time, by RBB, upon 60 days' written notice to shareholders. If an exchange is to a new n/i numeric investors family fund, the dollar value of Shares acquired must equal or exceed RBB's minimum for a new account; if to an existing account, the dollar value must equal or exceed RBB's minimum for subsequent investments. If 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 by RBB, the account will be subject to involuntary redemption. PURCHASE AND EXCHANGE PRIVILEGE LIMITATIONS The Funds' exchange privilege is not intended to afford shareholders a way to speculate on short-term movements in the market. Accordingly, in order to prevent excessive use of the exchange privilege that may potentially disrupt the management of the Funds and increase transactions costs, the Funds have established a policy of limiting excessive exchange activity. 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 Adviser reasonably deems to be disruptive to efficient portfolio management. TELEPHONE TRANSACTIONS In order to request redemptions and exchanges by telephone, an investor must have completed and returned an account application containing the appropriate telephone election. To add a telephone exchange feature to an existing account that previously did not provide for this option, a Telephone Exchange Authorization Form (available from PFPC) must be filed with PFPC. Once this election has been made, the shareholder may simply contact PFPC by telephone to request the exchange by calling (800) 348-5031. Neither RBB, the Funds, the Distributor, the Co-Administrators, the Administrative Services Agent, the transfer agent, nor any other Fund agent will be liable for any loss, liability, cost or expense for following RBB's telephone transaction procedures described below or for following instructions communicated by telephone that they reasonably believe to be genuine. 16 RBB's telephone transaction procedures include the following measures: (1) requiring the appropriate telephone transaction privilege forms; (2) requiring the caller to provide the names of the account owners, the account's federal tax identification number and name of the Fund, all of which must match RBB's records; (3) permitting exchanges only if the two account registrations are identical; (4) requiring that redemption proceeds be sent only by check to the account owners of record at the address of record, or by wire only to the owners of record at the bank account of record; (5) sending a written confirmation for each telephone transaction to the owners of record at the address of record within five (5) business days of the call; and (6) maintaining tapes of telephone transactions for six months, if the Fund elects to record shareholder telephone transactions. For accounts held of record by Service Agents, additional documentation or information regarding the scope of a caller's authority is required. Finally, for telephone transactions in accounts held jointly, additional information regarding other account holders is required. Telephone transactions will not be permitted in connection with IRA or other retirement plan accounts or by an attorney-in-fact under power of attorney. CLOSING OF FUNDS Numeric will monitor the Funds' total assets and may close any of the Funds at any time to new investment 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 investment at any time, and may subsequently close such Fund again should concerns regarding Fund size recur. Numeric reserves the right while a Fund is closed to accept new investments from any of its employees or their spouses, parents or children. N/I NUMERIC INVESTORS MICRO CAP FUND. Shares of the n/i numeric investors Micro Cap Fund are offered only to certain existing shareholders of the Fund and certain other persons, who are generally subject to cumulative, maximum purchase amounts, as follows: . Each person who on September 12, 1997 held shares of this Fund directly, may invest up to an additional $25,000 in shares of this Fund between September 15, 1997 and August 31, 1998, and an additional $25,000 in each fiscal year ended August 31 thereafter, plus distributions that are automatically reinvested. . Employees of Numeric and their spouses, parents and children may invest in shares of this Fund without limit. All purchase orders that are wholly or partially in excess of the maximum purchase amounts will be returned. Other persons who are shareholders of other n/i numeric investors Funds are not permitted to acquire shares of this Fund by exchange. N/I NUMERIC INVESTORS GROWTH FUND. Shares of the n/i numeric investors Growth Fund are offered only to (i) persons who already hold shares of this Fund directly or through accounts maintained by brokers by arrangement with RBB, (ii) existing and future clients of financial advisors and planners whose clients already hold shares of this Fund, and (iii) employees of Numeric and their spouses, parents and children. Other persons who are shareholders of other n/i numeric investors Funds are not permitted to acquire shares of this Fund by exchange. Distributions to all shareholders of the Fund will continue to be reinvested unless a shareholder elected otherwise. N/I NUMERIC INVESTORS GROWTH AND VALUE FUND. In the event that the net assets of the n/i Growth and Value Fund increase to an amount that exceeds $200,000,000, the restrictions that apply to the sale of shares of the n/i numeric investors Growth Fund would also apply to the sale of shares of this Fund. The adviser reserves the right to further restrict sales of shares of any Fund. As of December 1, 1997, the net assets of the n/i numeric investors Growth & Value Fund were $73 million. HOW TO REDEEM SHARES REDEMPTION IN WRITING Shareholders may redeem for cash some or all of their Fund Shares at any time. To do so, a written request in proper form must be sent directly to The n/i numeric investors family of funds c/o PFPC, P.O. Box 8966, Wilmington, Delaware 19899-8966. Shareholders may also place redemption requests through a Service Agent, but such Service Agent might charge a fee for this service. 17 A request for redemption must be signed by all persons in whose names the Shares are registered. Signatures must conform exactly to the account registration. If the proceeds of the redemption would exceed $10,000, or if the proceeds are not to be paid to the record owner at the record address, or if the shareholder is a corporation, partnership, trust or fiduciary, signature(s) must be guaranteed according to the procedures described above under "How to Purchase Shares--Exchange Privilege." A signature guarantee verifies the authenticity of your signature. You may call PFPC at (800) 348- 5031 with respect to questions about signature guarantees. Generally, a properly signed written request with any required signature guarantee is all that is required for a redemption. In some cases, however, other documents may be necessary. Additional documentary evidence of authority is also required by PFPC in the event redemption is requested by a corporation, partnership, trust, fiduciary, executor or administrator. REDEMPTION BY TELEPHONE Investors may redeem shares without charge by telephone if they have checked the appropriate box and supplied the necessary information on the Application, or have filed a Telephone Authorization with PFPC. An investor may obtain a Telephone Authorization from PFPC by calling (800) 348-5031. The proceeds will be mailed by check to an investor's registered address unless he has designated in his Application or Telephone Authorization that such proceeds are to be sent by wire transfer to a specified checking or savings account. If proceeds are to be sent by wire transfer, a telephone redemption request received prior to the close of regular trading on the NYSE will result in redemption proceeds being wired to the investor's bank account on the next bank business day and the redemption price will be the net asset value completed as of the close of regular trading on the NYSE on that Business Day. A redemption request received after the close of regular trading on the NYSE will be priced at the net asset value computed on the next Business Day. All redemption requests must be in good order before being processed. The minimum redemption for proceeds sent by wire transfer is $2,500. There is no maximum for proceeds sent by wire transfer. The Funds may modify this redemption service at any time or charge a service fee upon prior notice to shareholders. No service fee is currently contemplated, although RBB and PFPC reserve the right to refuse a telephone redemption request if they deem it advisable to do so. RBB's telephone procedures are set forth under "How to Purchase Shares-- Telephone Transactions" above. OTHER INFORMATION ON REDEMPTIONS The Funds are not responsible for the efficiency of the Federal Wire System or a shareholder's investment adviser, broker-dealer or bank. The shareholder is responsible for any charges imposed by the shareholder's bank. To change the name of the single designated bank account to receive redemptions, it is necessary to send a written request (with a signature guaranteed as set forth above) to The n/i numeric investors family of funds, c/o PFPC Inc., P. O. Box 8966, Wilmington, Delaware 19899-8966. INVOLUNTARY REDEMPTION RBB reserves the right to redeem a shareholder's account in any Fund at any time the net asset value of the account in such Fund falls below $500 as the result of a redemption or an exchange request. Shareholders will be notified in writing that the value of their account in a Fund is less than $500 and will be allowed 30 days to make additional investments before the redemption is processed. PAYMENT OF REDEMPTION PROCEEDS In all cases, the redemption price is the net asset value per share next determined after the request for redemption is received in proper form by PFPC. Payment for Shares redeemed is made by check mailed within seven days after acceptance by PFPC of the request and any other necessary documents in proper order. Such payment may be postponed or the right of redemption suspended as provided by the rules of the SEC. If the Shares to be redeemed have been recently purchased by check, PFPC may delay mailing a redemption check, which may be a period of up to 15 days, pending a determination that the check has cleared. REDEMPTION IN-KIND The Funds reserve the right, if conditions exist which make cash payments undesirable, to honor any request for redemption of a Fund's shares by making payment in whole or in part in securities chosen by the Fund and valued in the same way as they would be valued for purposes of computing a Fund's net asset value. If payment is made in securities, a 18 shareholder may incur transaction costs in converting these securities into cash after they have redeemed their Shares. The Funds have elected, however, to be governed by Rule 18f-1 under the 1940 Act, so that a Fund is obligated to redeem its Shares solely in cash up to the lesser of $250,000 or 1% of its net asset value during any 90-day period for any one shareholder of a Fund. AUTOMATIC WITHDRAWAL Automatic withdrawal permits investors to request withdrawal of a specified dollar amount (minimum of $25) on either a monthly, quarterly or annual basis if the investor has a $10,000 minimum account. An application for automatic withdrawal can be obtained from PFPC. Automatic withdrawal may be ended at any time by the investor, RBB or PFPC. Purchases of additional shares concurrently with withdrawals generally are undesirable. NET ASSET VALUE The net asset value of each Fund is calculated as of the close of regular trading on the NYSE on each Business Day. The net asset value for each Fund is calculated by adding the value of all its securities, cash and other assets, deducting its actual and accrued liabilities and dividing the result by the number of outstanding Shares of a Fund. The net asset value of each Fund is calculated independently of the other Funds. Valuation of securities held by each Fund is as follows: securities traded on a national securities exchange or on the NASDAQ National Market System are valued at the last reported sale price that day; securities traded on a national securities exchange or on the NASDAQ National Market System for which there were no sales on that day and securities traded on other over-the- counter markets for which market quotations are readily available are valued at the mean of the bid and asked prices; and securities for which market quotations are not readily available are valued at fair market value as determined in good faith under procedures established by RBB's Board of Directors. The amortized cost method of valuation may also be used with respect to debt obligations with sixty days or less remaining to maturity. With the approval of RBB's Board of Directors, each Fund may use a pricing service, bank or broker-dealer experienced in such matters to value a Fund's securities. A more detailed discussion of net asset value and security valuation is contained in the Statement of Additional Information. DIVIDENDS AND DISTRIBUTIONS The Funds will distribute substantially all of their net investment income and net realized capital gains, if any, to each Fund's shareholders. All distributions are reinvested in the form of additional full and fractional Shares of the relevant Fund unless a shareholder elects otherwise. The Funds expect to declare and pay dividends from net investment income annually, generally near the end of the year. Net realized capital gains (including net short-term capital gains), if any, will be distributed at least annually. TAXES The following discussion is only a brief summary of some of the important tax considerations generally affecting the Funds and their shareholders and is not intended as a substitute for careful tax planning. Accordingly, investors in the Funds should consult their tax advisers with specific reference to their own tax situation. Each Fund will elect to be taxed as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended. So long as a Fund qualifies for this tax treatment, it will be relieved of federal income tax on amounts distributed to shareholders, but shareholders, unless otherwise exempt, will pay income or capital gains taxes on amounts so distributed (except distributions that are treated as a return of capital) regardless of whether such distributions are paid in cash or reinvested in additional Shares. Distributions out of the net capital gain (the excess of net long-term capital gain over net short-term capital loss), if any, of any Fund, and out of the portion of such net capital gain that constitutes mid-term capital gain, will be taxed to shareholders as long-term capital gain or mid-term capital gain, as the case may be, regardless of the length of time a shareholder has held his Shares, whether such gain was reflected in the price paid for the Shares or whether such gain was attributable to bonds bearing tax-exempt interest 19 or mid-term capital gain, as the case may be. All other distributions, to the extent they are taxable, are taxed to shareholders as ordinary income. RBB will send written notices to shareholders annually regarding the tax status of distributions made by each Fund. Dividends declared in December of any year payable to shareholders of record on a specified date in such a month will be deemed to have been received by the shareholders on December 31, provided such dividends are paid during January of the following year. Each Fund intends to make sufficient actual or deemed distributions prior to the end of each calendar year to avoid liability for federal excise tax. Investors should be careful to consider the tax implications of buying Shares just prior to a distribution. The price of shares purchased at that time will reflect the amount of the forthcoming distribution. Those investors purchasing just prior to a distribution will nevertheless be taxed on the entire amount of the distribution received, although the distribution is, in effect, a return of capital. 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 pursue active strategies, which have higher turnover than passive strategies. The following describes the impact of portfolio turnover on returns. 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 or mid-term capital gain tax rates for middle and upper income taxpayers. Second, the frequent realization of gains, which causes taxes to be paid frequently, is less advantageous than infrequent realization of gains. Infrequent realization of gains allows the payment of taxes to be deferred to later years, allowing more of the gains to compound before taxes are paid. Consequently after-tax compound rates of return will generally be higher for taxable investors using investment strategies with very low turnover, all else being equal. Although tax considerations should not typically drive an investment decision, investors should consider their ability to allocate tax-deferred (such as IRAs and 401(k) plans) versus taxable assets when considering where to invest. All else being equal, investors will earn better returns investing tax-deferred assets in active strategies, while using lower turnover passive strategies for taxable investments. Shareholders who exchange Shares representing interests in one Fund for Shares representing interests in another Fund will generally recognize a capital gain or loss for federal income tax purposes. Shareholders who are nonresident alien individuals, foreign trusts or estates, foreign corporations or foreign partnerships may be subject to different U.S. federal income tax treatment. DESCRIPTION OF SHARES RBB has authorized capital of thirty billion shares of Common Stock, $.001 par value per share, of which 13.93 billion shares are currently classified into 82 different classes of Common Stock (see "Description of Shares" in the Statement of Additional Information). Exchanges between the n/i numeric investors family of funds and other families of RBB are not permitted. In addition, persons who are shareholders of the other n/i numeric investors Funds are not permitted to acquire shares of the n/i numeric investors Growth Fund or n/i numeric investors Micro Cap Fund by exchange. THIS PROSPECTUS AND THE STATEMENT OF ADDITIONAL INFORMATION INCORPORATED HEREIN RELATE PRIMARILY TO THE N/I NUMERIC INVESTORS FAMILY CLASSES AND DESCRIBE ONLY THE INVESTMENT OBJECTIVES AND POLICIES, OPERATIONS, CONTRACTS AND OTHER MATTERS RELATING TO THE N/I NUMERIC INVESTORS FAMILY CLASSES. Each share that represents an interest in a Fund has an equal proportionate interest in the assets belonging to such Fund with each other share that represents an interest in such Fund, even where a share has a different class designation than another share representing an interest in that Fund. Shares of RBB 20 do not have preemptive or conversion rights. When issued for payment as described in this Prospectus, shares of RBB will be fully paid and non- assessable. RBB currently does not intend to hold annual meetings of shareholders except as required by the 1940 Act or other applicable law. The law under certain circumstances provides shareholders with the right to call for a meeting of shareholders to consider the removal of one or more directors. To the extent required by law, RBB will assist in shareholder communication in such matters. Holders of shares of each of the Funds will vote in the aggregate and not by class on all matters, except where otherwise required by law. Further, shareholders of all investment portfolios of RBB will vote in the aggregate and not by portfolio except as otherwise required by law or when the Board of Directors determines that the matter to be voted upon affects only the interests of the shareholders of a particular investment portfolio. (See the Statement of Additional Information under "Additional Information Concerning Fund Shares" for examples when the 1940 Act requires voting by investment portfolio or by class.) Shareholders of RBB are entitled to one vote for each full share held (irrespective of class or portfolio) and fractional votes for fractional shares held. Voting rights are not cumulative and, accordingly, the holders of more than 50% of the aggregate shares of Common Stock of RBB may elect all of the directors. As of November 15, 1997, to RBB's knowledge, no person held of record or beneficially 25% or more of the outstanding shares of all classes of RBB. OTHER INFORMATION REPORTS AND INQUIRIES Shareholders will receive unaudited semi-annual reports describing the Funds' investment operations and annual financial statements audited by independent accountants. Shareholder inquiries should be addressed to PFPC, Bellevue Park Corporate Center, 400 Bellevue Parkway, Wilmington, Delaware 19809, toll-free (800) 348-5031. FUND PERFORMANCE INFORMATION From time to time, the Funds may advertise their performance, including comparisons to other mutual funds with similar investment objectives or to stock or other relevant indices. All such advertisements will show the average annual total return over one, five and ten year periods or, if such periods have not yet elapsed, shorter periods corresponding to the life of such Funds. Such total return quotations will be computed by finding the compounded average annual total return for each time period that would equate the assumed initial investment of $1,000 to the ending redeemable value, net of fees, according to a required standardized calculation. The standard calculation is required by the SEC to provide consistency and comparability in investment company advertising. The Funds may also from time to time include in such advertising an aggregate total return figure or a total return figure that is not calculated according to the standardized formula in order to compare more accurately a Fund's performance with other measures of investment return. For example, a Fund's total return may be compared with data published by Lipper Analytical Services, Inc., CDA Investment Technologies, Inc. or Weisenberger Investment Company Service, or with the performance of the Standard & Poor's 500 Stock Index or the Dow Jones Industrial Average, as well as the benchmarks described in the Appendix to this Prospectus. Performance information may also include evaluation of the Funds by nationally recognized ranking services and information as reported in financial publications such as Barron's, Business Week, Forbes, Fortune, Money Magazine, Mutual Fund Magazine, The New York Times, The Wall Street Journal, or other national, regional or local publications. All advertisements containing performance data will include a legend disclosing that such performance data represents past performance and that the investment return and principal value of an investment will fluctuate so that an investor's Shares, when redeemed, may be worth more or less than their original cost. 21 (THIS PAGE LEFT BLANK INTENTIONALLY) APPENDIX A PERFORMANCE BENCHMARKS
N/I NUMERIC PERFORMANCE INVESTORS FUND BENCHMARK DESCRIPTION - ------------------------------------------------------------------------------- Micro Cap Russell 2000 The Russell 2000 is an index of stocks 1001 Growth Index through 3000 in the Russell 3000 Index as ranked by total market capitalization. This index is segmented into growth and value categories. The Russell 2000 Growth Index contains stocks from the Russell 2000 with greater-than-average growth orientation. Companies in this index generally have higher price-to-book and price/earnings ratios. - ------------------------------------------------------------------------------- Growth Russell 2500 The Russell 2500 is an index of stocks 501 Growth Index through 3000 in the Russell 3000 Index, as ranked by total market capitalization. This index is segmented into growth and value categories. The Russell 2500 Growth Index contains stocks from the Russell 2500 with greater-than-average growth orientation. Companies in this index generally have higher price-to-book and price/earnings ratios. - ------------------------------------------------------------------------------- Growth S&P MidCap 400 A broad-based index of 400 companies with & Value Index market capitalizations from $236 million to $11.3 billion. The Standard & Poor's MidCap 400 Index is a widely accepted, unmanaged index of overall mid-cap stock market performance. - ------------------------------------------------------------------------------- Larger Cap Russell 1000 The Russell 1000 Index consists of the 1,000 Value Value Index largest securities in the Russell 3000 Index as ranked by total market capitalization. This index is segmented into growth and value categories. The Russell 1000 Value Index contains stocks from the Russell 1000 with less than average growth orientation. Companies in this index generally have low price to book and price/earnings ratios, higher dividend yields, and lower forecasted growth values. - -------------------------------------------------------------------------------
App. A-1 N/I NUMERIC INVESTORS family of funds 1 - 800 - NUMERIC (686-3742) ACCOUNT APPLICATION Please Note: Do not use this form to open an individual retirement plan account (such as an IRA). For an IRA application or help with this Application, please call 1-800-NUMERIC (686-3742). 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 2. MAILING ADDRESS: - -------------------------------------------------------------------------------- STREET OR P.O. BOX APARTMENT NUMBER - -------------------------------------------------------------------------------- CITY STATE ZIP CODE ( ) ( ) - -------------------------------------------------------------------------------- DAY PHONE NUMBER EVENING PHONE NUMBER 3. INVESTMENT AMOUNT: Minimum initial investment of $3,000 per Fund or $1,000 for an automatic investment plan. [_] N/I NUMERIC INVESTORS MICRO CAP$ CLOSE___________________________D [_] N/I NUMERIC INVESTORS GROWTH$ CLOSE______________________________D [_] N/I NUMERIC INVESTORS GROWTH & VALUE$ ____________________________ [_] N/I NUMERIC INVESTORS LARGER CAP VALUE$ __________________________ MAKE THE CHECK PAYABLE TO N/I NUMERIC INVESTORS 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) - ----------------- TRUST DATE NOT PART OF THE PROSPECTUS 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 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 and used to purchase shares of a specified n/i numeric investors Fund. Please debit $ from my checking account (named below) on or about the 20th of every month. $ into the 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 (IF APPLICABLE): PLEASE ATTACH AN UNSIGNED, VOIDED CHECK. To select this option please fill out the information below: Fund Name _________ Amount ____________________________________________________ Startup Month _____ Frequency Options: [_] Annually [_] Monthly [_] Quarterly . 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 Complete only if using Automatic Investment Plan or Systematic Withdrawal Plan 8. BANK OF RECORD: COMPLETE ONLY IF USING AUTOMATIC INVESTMENT PLAN (SECTION 6) OR SYSTEMATIC WITHDRAWAL PLAN (SECTION 7) - -------------------------------------------------------------------------------- BANK NAME - -------------------------------------------------------------------------------- STREET ADDRESS OR P.O. BOX - -------------------------------------------------------------------------------- CITY STATE ZIP CODE - -------------------------------------------------------------------------------- BANK ABA NUMBER BANK ACCOUNT NUMBER 9. SIGNATURES: The undersigned warrants that I (we) have full authority and, if a natural person, I (we) am (are) of legal age to purchase shares pursuant to this Account Information Form, and I (we) have received a current prospectus for the n/i numeric investors Fund(s) in which I (we) am (are) investing. Under the Interest and Dividend Tax Compliance Act of 1983, the Fund is required to have the following certification: Under penalties of perjury, I certify that: (1) The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me), and (2) I am not subject to backup withholding because (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service that I am subject to 31% backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding. Note: You must cross out item (2) above if you have been notified by the IRS that you are currently subject to backup withholding because you have failed to report all interest and dividends on your tax return. The Internal Revenue Service does not require your consent to any provision of this document other than the certification required to audit backup withholding. - -------------------------------------------------------------------------------- SIGNATURE OF APPLICANT DATE - -------------------------------------------------------------------------------- PRINT NAME TITLE (IF APPLICABLE) - -------------------------------------------------------------------------------- SIGNATURE OF JOINT OWNER DATE - -------------------------------------------------------------------------------- PRINT NAME TITLE (IF APPLICABLE) (If you are signing for a corporation, you must indicate corporate office or title. If you wish additional signatories on the account, please include a corporate resolution. If signing as a fiduciary, you must indicate capacity.) For information on additional options, such as IRA Applications, rollover requests for qualified retirement plans, or for wire instructions, please call us at 1-800-NUMERIC (686-3742). For information on new or existing accounts call 1-800-348-5031. MAIL COMPLETED ACCOUNT APPLICATION AND CHECK TO: N/I NUMERIC INVESTORS FAMILY OF FUNDS C/O PFPC INC. P.O. BOX 8966 WILMINGTON, DE 19899-8966 NOT PART OF THE PROSPECTUS N/I NUMERIC INVESTORS family of funds 1-800-NUMERIC [686-3742] HTTP://WWW.NUMERIC.COM INVESTMENT ADVISER Numeric Investors L.P. One Memorial Drive Cambridge, MA 02142 CUSTODIAN Custodial Trust Company 101 Carnegie Center Princeton, NJ 05840 CO-ADMINISTRATOR, TRANSFER AGENT AND DIVIDEND DISBURSING AGENT PFPC Inc. Bellevue Corporate Center 400 Bellevue Parkway Wilmington, DE 19809 CO-ADMINISTRATOR Bear Stearns Funds Management Inc. 245 Park Avenue, 15th floor New York, NY 10167 ADMINISTRATIVE SERVICES AGENT Counsellors Funds Service, Inc. New York, New York 10017 DISTRIBUTOR Counsellors Securities Inc. 466 Lexington Avenue New York, NY 10017 COUNSEL Drinker Biddle & Reath LLP 1345 Chestnut Street Philadelphia, PA 19107-3496 INDEPENDENT ACCOUNTANTS Coopers & Lybrand L.L.P. 2400 Eleven Penn Center Philadelphia, PA 19103 n/i numeric investors Micro Cap Fund n/i numeric investors Growth Fund n/i numeric investors Growth & Value Fund n/i numeric investors Larger Cap Value Fund (Investment Portfolios of The RBB Fund, Inc.) STATEMENT OF ADDITIONAL INFORMATION This Statement of Additional Information provides supplementary information pertaining to shares of the classes (the "Shares") representing interests in the 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 Growth & Value Fund (the "Growth & Value Fund") and the n/i numeric investors Larger Cap Value Fund (the "Larger Cap Value Fund") (together, the "Funds") of The RBB Fund, Inc. ("RBB"). This Statement of Additional Information is not a prospectus and should be read only in conjunction with the n/i numeric investors family of funds Prospectus dated December 9, 1997 (the "Prospectus"). A copy of the Prospectus may be obtained from Numeric by calling toll-free (800) NUMERIC [(800) 686-3742]. This Statement of Additional Information is dated December 9, 1997.
Prospectus Page Page ---- ---------- General................................ 3 1 Investment Objectives and Policies..... 3 9 Investment Limitations................. 14 16 Directors and Officers................. 16 N/A Investment Advisory, Distribution and Servicing Arrangements............... 20 17 Fund Transactions...................... 27 21 Purchase and Redemption Information.... 30 21,27 Valuation of Shares.................... 31 29 Performance Information................ 32 N/A Taxes.................................. 35 30 Description of Shares.................. 40 32 Additional Information Concerning Fund Shares.......................... 43 N/A Miscellaneous.......................... 44 N/A Financial Statements................... 55 N/A Appendix A............................. A-1 A-1
No person has been authorized to give any information or to make any representations not contained in this Statement of Additional Information in connection with the offering made by the Prospectus and, if given or made, such information or representations must not be relied upon as having been authorized by RBB or its distributor. The Statement of Additional Information does not constitute an offering by RBB or by the distributor in any jurisdiction in which such offering may not lawfully be made. -2- GENERAL RBB is an open-end management investment company currently operating or proposing to operate twenty-two separate investment portfolios. RBB is an open-end investment company registered under the Investment Company Act of 1940 (the "1940 Act") and was organized as a Maryland corporation on February 29, 1988. This Statement of Additional Information pertains to Shares representing interests in the Funds offered by the Prospectus dated December 9, 1997. Capitalized terms used herein and not otherwise defined have the same meanings as are given to them in the Prospectus. INVESTMENT OBJECTIVES AND POLICIES The following supplements the information contained in the Prospectus concerning the investment objectives and policies of the Funds. Futures Futures Contracts. When a Fund purchases a futures contract, it agrees to purchase a specified underlying instrument at a specified future date. When a Fund sells a futures contract, it agrees to sell the underlying instrument at a specified future date. The price at which the purchase and sale will take place is fixed when a Fund enters into the contract. The underlying instrument may be a specified type of security, such as U.S. Treasury bonds or notes. The majority of futures contracts are closed out by entering into an offsetting purchase or sale transaction in the same contract on the exchange where they are traded, rather than being held for the life of the contract. Futures contracts are closed out at their current prices, which may result in a gain or loss. If a Fund holds a futures contract until the delivery date, it will be required to complete the purchase and sale contemplated by the contract. In the case of futures contracts on securities, the purchaser generally must deliver the agreed-upon purchase price in cash, and the seller must deliver securities that meet the specified characteristics of the contract. -3- A Fund may purchase futures contracts as an alternative to purchasing actual securities. For example, if a Fund intended to purchase bonds but had not yet done so, it could purchase a futures contract in order to lock in current bond prices while deciding on particular investments. This strategy is sometimes known as an anticipatory hedge. Alternatively, a Fund could purchase a futures contract if it had cash and short-term securities on hand that it wished to invest in longer-term securities, but at the same time that Fund wished to maintain a highly liquid position in order to be prepared to meet redemption requests or other obligations. In these strategies a Fund would use futures contracts to attempt to achieve an overall return -- whether positive or negative -- similar to the return from longer-term securities, while taking advantage of potentially greater liquidity that futures contracts may offer. Although the Funds would hold cash and liquid debt securities in a segregated account with a value sufficient to cover their open futures obligations, the segregated assets would be available to the Funds immediately upon closing out the futures position, while settlement of securities transactions can take several days. However, because a Fund's cash that would otherwise have been invested in higher-yielding bonds would be held uninvested or invested in short- term securities so long as the futures position remains open, the Fund's return would involve a smaller amount of interest income and potentially a greater amount of capital gain or loss. The Funds may sell futures contracts to hedge their other investments against changes in value, or as an alternative to sales of securities. For example, if the investment adviser anticipated a decline in bond prices, but did not wish to sell bonds owned by a Fund, it could sell a futures contract in order to lock in a current sale price. If prices subsequently fell, the future contract's value would be expected to rise and offset all or a portion of the loss in the bonds that the Fund had hedged. Of course, if prices subsequently rose, the futures contract's value could be expected to fall and offset all or a portion of the benefit of the Fund. In this type of strategy, a Fund's return will tend to involve a larger component of interest income, because the Fund will remain invested in longer-term securities rather than selling them and investing the proceeds in short-term securities which generally provide lower yields. Futures margin payments. The purchaser or seller of a futures contract is not required to deliver or pay for the underlying instrument unless the contract is held until the delivery date. However, both the purchaser and seller are required to deposit "initial margin" with a futures broker (known as a futures commission merchant, or FCM), when the contract is entered into. Initial margin deposits are equal to a percentage of the contract's value, as set by the exchange where the contract is traded, and may be maintained in cash or high quality -4- liquid securities. If the value of either party's position declines, that party will be required to make additional "variation margin" payments to settle the change in value on a daily basis. The party that has a gain may be entitled to receive all or a portion of this amount. Initial and variation margin payments are similar to good faith deposits or performance bonds, unlike margin extended by a securities broker, and initial and variation margin payments do not constitute purchasing securities on margin for purposes of a Fund's investment limitations. In the event of the bankruptcy of an FCM that holds margin on behalf of a Fund, that Fund may be entitled to a return of margin owed to it only in proportion to the amount received by the FCM's other customers. The investment adviser will attempt to minimize this risk by careful monitoring of the creditworthiness of the FCMs with which a Fund does business. Correlation of price changes. The prices of futures contracts depend primarily on the value of their underlying instruments. Because there are a limited number of types of futures contracts, it is likely that the standardized futures contracts available to a Fund will not match that Fund's current or anticipated investments. Futures prices can also diverge from the prices of their underlying instruments, even if the underlying instruments match a Fund's investments well. Futures prices are affected by such factors as current and anticipated short-term interest rates, changes in volatility of the underlying instrument, and the time remaining until expiration of the contract, which may not affect security prices the same way. Imperfect correlation between a Fund's investments and its futures positions may also result from differing levels of demand in the futures markets and the securities markets, from structural differences in how futures and securities are traded, or from imposition of daily price fluctuation limits for futures contracts. The Funds may purchase or sell futures contracts with a greater or lesser value than the securities they wish to hedge or intend to purchase in order to attempt to compensate for differences in historical volatility between the futures contract and the securities, although this may not be successful in all cases. If price changes in a Fund's futures positions are poorly correlated with its other investments, its futures positions may fail to produce anticipated gains or result in losses that are not offset by the gains in the Fund's other investments. Liquidity of futures contracts. Because futures contracts are generally settled within a day from the date they are closed out, compared with a settlement period of seven days for some types of securities, the futures markets can provide liquidity superior to the securities markets in many cases. Nevertheless, there is no assurance a liquid secondary market will exist for any particular futures contract at any particular time. In addition, futures exchanges may establish daily price fluctuation limits for futures contracts and may halt trading if a contract's -5- price moves upward or downward more than the limit in a given day. On volatile trading days when the price fluctuation limit is reached, it may be impossible for a Fund to enter into new positions or close out existing positions. If the secondary market for a futures contract is not liquid because of price fluctuation limits or otherwise, it would prevent prompt liquidation of unfavorable futures positions, and potentially could require a Fund to continue to hold a futures position until the delivery date regardless of changes in its value. As a result, a Fund's access to other assets held to cover its futures positions could also be impaired. Put and Call Options Purchasing Put Options. By purchasing a put option, a Fund obtains the right (but not the obligation) to sell the option's underlying instrument at a fixed strike price. The option may give a Fund the right to sell only on the option's expiration date, or may be exercisable at any time up to and including that date. In return for this right, a Fund pays the current market price for the option (known as the option premium). The option's underlying instrument may be a security or a futures contract. A Fund may terminate its position in a put option it has purchased by allowing it to expire or by exercising the option. If the option is allowed to expire, the Fund will lose the entire premium it paid. If the Fund exercises the option, it completes the sale of the underlying instrument at the strike price. If a Fund exercises a put option on a futures contract, it assumes a seller's position in the underlying futures contract. Purchasing an option on a futures contract does not require a Fund to make futures margin payments unless it exercises the option. A Fund may also terminate a put option position by closing it out in the secondary market at its current price, if a liquid secondary market exists. Put options may be used by a Fund to hedge securities it owns, in a manner similar to selling futures contracts, by locking in a minimum price at which the Fund can sell. If security prices fall, the value of the put option would be expected to rise and offset all or a portion of the Fund's resulting losses. The put thus acts as a hedge against a fall in the price of such securities. However, all other things being equal (including securities prices) option premiums tend to decrease over time as the expiration date nears. Therefore, because of the cost of the option in the form of the premium (and transaction costs), a Fund would expect to suffer a loss in the put option if prices do not decline sufficiently to offset the deterioration in the value of the option premium. This potential loss represents the cost of the hedge against a fall in prices. At the same time, because the maximum a Fund has at risk is the cost of the option, purchasing put options does not eliminate the -6- 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 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 -7- 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 -8- affected if options exchanges impose trading halts, particularly when markets are volatile. Asset Coverage for Futures and Options Positions. A Fund will not use leverage in its options and futures strategies. A Fund will hold securities or other options or futures positions whose values are expected to offset its obligations under the hedge strategies. A Fund will not enter into an option or futures position that exposes the Fund to an obligation to another party unless it owns either (i) an offsetting position in securities or other options or futures contracts or (ii) cash, receivables and short-term debt securities with a value sufficient to cover its potential obligations. A Fund will comply with guidelines established by the SEC with respect to coverage of options and futures strategies by mutual funds, and if the guidelines so require will set aside cash and high grade liquid debt securities in a segregated account with its custodian bank in the amount prescribed. Securities held in a segregated account cannot be sold while the futures or option strategy is outstanding, unless they are replaced with similar securities. As a result, there is a possibility that segregation of a large percentage of a Fund's assets could impede portfolio management or the Fund's ability to meet redemption requests or other current obligations. Limitations on Futures and Options Transactions. RBB, on behalf of the Funds, has filed a notice of eligibility for exclusion from the definition of the term "commodity pool operator" with the Commodity Futures Trading Commission ("CFTC") and the National Futures Association, which regulate trading in the futures markets. Pursuant to Section 4.5 of the regulations under the Commodity Exchange Act, the Funds will not enter into any commodity futures contract or option on a commodity futures contract for non-hedging purposes if, as a result, the sum of initial margin deposits on commodity futures contracts and related commodity options and premiums paid for options on commodity futures contracts the Funds have purchased would exceed 5% of a Fund's net assets after taking into account unrealized profits and losses on such contracts. The Funds' limitations on investments in futures contracts and their policies regarding futures contracts and the limitations on investments in options and its policies regarding options discussed above in this Statement of Additional Information, are not fundamental policies and may be changed as regulatory agencies permit. The Funds will not modify the above limitations to increase its permissible futures and options activities without supplying additional information in a current Prospectus or Statement of Additional Information that has been distributed or made available to the Funds' shareholders. Short Sales "Against the Box" -9- In a short sale, a Fund sells a borrowed security and has a corresponding obligation to the lender to return the identical security. A Fund may engage in short sales if at the time of the short sale it owns or has the right to obtain, at no additional cost, an equal amount of the security being sold short. This investment technique is known as a short sale "against the box." In a short sale, a seller does not immediately deliver the securities sold and is said to have a short position in those securities until delivery occurs. If a Fund engages in a short sale, the collateral for the short position will be maintained by the Fund's custodian or a qualified sub-custodian. While the short sale is open, the Fund will maintain in a segregated account an amount of securities equal in kind and amount to the securities sold short or securities convertible into or exchangeable for such equivalent securities. These securities constitute a Fund's long position. The Funds will not engage in short sales against the box for speculative purposes. A Fund may, however, make a short sale as a hedge, when it believes that the price of a security may decline, causing a decline in the value of a security owned by the Fund (or a security convertible or exchangeable for such security), or when the Fund wants to sell the security at an attractive current price, but also wishes possibly to defer recognition of gain or loss for federal income tax purposes. (A short sale against the box will defer recognition of gain for federal income tax purposes only if the Portfolio subsequently closes the short position by making a purchase of the relevant securities no later than 30 days after the end of the taxable year.) In such case, any future losses in a Fund's long position should be reduced by a gain in the short position. Conversely, any gain in the long position should be reduced by a loss in the short position. The extent to which such gains or losses are reduced will depend upon the amount of the security sold short relative to the amount a Fund owns. There will be certain additional transaction costs associated with short sales against the box, but the Funds will endeavor to offset these costs with the income from the investment of the cash proceeds of short sales. 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, -10- thereby providing liquidity. See "Illiquid Securities" below and Appendix "A" for a list of commercial paper ratings. 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 -11- 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). 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. 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 -12- 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. Convertible Securities The Funds may invest in convertible securities, such as convertible debentures, bonds and preferred stock, primarily for their equity characteristics. Convertible securities may be converted into common stock at a specified share price or ratio. Because the price of the common stock may fluctuate above or below the specified price or ratio, a Fund may have the opportunity to purchase the common stock at below market price. On the other hand, fluctuations in the price of the common stock could render the right of conversion worthless. Repurchase Agreements The repurchase price under 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 Investment Company Act of 1940, as amended (the "1940 Act"), and may be entered into only for temporary or emergency purposes. While reverse repurchase transactions are outstanding, a Fund will maintain in a segregated account with its custodian or a qualified sub-custodian, cash, U.S. Government securities or other liquid, high-grade debt 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. -13- 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. When-Issued Securities and Forward Commitments Each Fund may purchase securities on a "when-issued" basis and may purchase or sell securities on a "forward commitment" basis. These transactions involve a commitment by a Fund to purchase or sell particular securities with payment and delivery taking place at a future date (perhaps one or two months later), and permit a Fund to lock-in a price or yield on a security it owns or intends to purchase, regardless of future changes in interest rates. When- issued and forward commitment transactions involve the risk, however, that the price or yield obtained in a transaction may be less favorable that the price or yield available in the market when the securities delivery takes place. A Fund's when-issued purchases and forward commitments are not expected to exceed 25% of the value of its total assets absent unusual market conditions. Each Fund does not intend to engage in when-issued purchases and forward commitments for speculative purposes but only in furtherance of their investment objectives. INVESTMENT LIMITATIONS The Funds have adopted the following fundamental investment limitations which may not be changed without the affirmative vote of the holders of a majority of the Funds' outstanding shares (as defined in Section 2(a)(42) of the 1940 Act). The Funds may not: 1. Purchase securities of any one issuer, other than securities issued or guaranteed by the U.S. Government or its agencies or instrumentalities, if immediately after and as a result of such purchase more than 5% of a Fund's total assets would be invested in the securities of such issuer, or more than 10% of the outstanding voting securities of such issuer would be owned by a Fund, except that up to 25% of the value of a Fund's assets may be invested without regard to such limitation. 2. Borrow money, except to the extent permitted under the 1940 Act or mortgage, pledge or hypothecate any of their respective assets in connection with any such borrowing except in amounts not in excess of 125% of the dollar amounts borrowed. -14- 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 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. -15- 9. Invest in oil, gas or mineral-related exploration or development programs or leases. 10. Purchase any securities issued by any other investment company, except to the extent permitted by the 1940 Act and except in connection with the merger, consolidation or acquisition of all the securities or assets of such an issuer. 11. Make investments for the purpose of exercising control or management, but each Fund will vote those securities it owns in its portfolio as a shareholder in accordance with its views. 12. Issue any senior security, as defined in section 18(f) of the 1940 Act, except to the extent permitted by the 1940 Act. 13. Pledge, mortgage or hypothecate its assets, except to the extent necessary to secure permitted borrowings as described in Limitation 1 above and to the extent related to the purchase of securities on a when-issued or forward commitment basis and the deposit of assets in escrow in connection with writing covered put and call options and collateral and initial or variation margin arrangements with respect to options, forward contracts, futures contracts, including those relating to indexes, and options on futures contracts or indexes. If a percentage restriction is adhered to at the time of investment, a later change in percentage resulting from a change in values or assets will not constitute a violation of such restriction (except that, with respect to borrowings, if asset coverage falls below 300%, a Fund will reduce its borrowings to restore asset coverage to 300% within three business days, in accordance with the requirements of the 1940 Act). DIRECTORS AND OFFICERS The directors and executive officers of RBB, their ages, business addresses and principal occupations during the past five years are: -16-
Name and Address and Position Principal Occupation Age with Fund During Past Five Years - ------------------------- --------- -------------------------- *Arnold M. Reichman -49 Director Senior Managing Director, 466 Lexington Avenue Chief Operating Officer New York, NY 10017 and Assistant Secretary, Warburg Pincus Asset Management Inc.; Director and Executive Officer of Counsellors Securities Inc.; Director/Trustee of various investment companies advised by Warburg Pincus Asset Management, Inc. **Robert Sablowsky -58 Director Senior Vice President, 110 Wall Street Fahnestock Co., Inc. (a New York, NY 10005 registered broker- dealer); Prior to October 1996, Executive Vice President of Gruntal & Co., Inc. (a registered broker-dealer). Francis J. McKay -60 Director Since 1963, Executive 7701 Burholme Avenue Vice President, Fox Chase Philadelphia, PA 19111 Cancer Center (biomedical research and medical care). Marvin E. Sternberg -62 Director Since 1974, Chairman, 937 Mt. Pleasant Road Director and President, Bryn Mawr, PA 19010 Moyco Industries, Inc. (manufacturer of dental supplies and precision coated abrasives); since 1968, Director and President, Mart MMM, Inc. (formerly Montgomeryville Merchandise Mart Inc.) and Mart PMM, Inc. (formerly Pennsauken Merchandise Mart, Inc.) (shopping centers); and since 1975, Director and Executive Vice President, Cellucap Mfg. Co., Inc. (manufacturer of disposable headwear).
-17-
Name and Address and Position Principal Occupation Age with Fund During Past Five Years - ------------------------- --------- -------------------------- Julian A. Brodsky -63 Director Director and Vice 1234 Market Street Chairman since 1969 16th Floor Comcast Corporation Philadelphia, PA (cable television and 19107-3723 communications); Director Comcast Cablevision of Philadelphia (cable television and communications) and Nextel (wireless communications). Donald van Roden -72 Director Self-employed 1200 Old Mill Lane and businessman. From Wyomissing, PA 19610 Chairman February 1980 to March of the 1987, Vice Chairman, Board SmithKline Beecham Corporation (pharmaceuticals); Director, AAA Mid- Atlantic (auto service); Director, Keystone Insurance Co. Edward J. Roach -73 President Certified Public Suite 100 and Accountant; Vice Chairman Bellevue Park Treasurer of the Board, Fox Chase Corporate Center Cancer Center; Trustee 400 Bellevue Parkway Emeritus, Pennsylvania Wilmington, DE 19809 School for the Deaf; Trustee Emeritus, Immaculata College; President or Vice President and Treasurer of various investment companies advised by PNC Institutional Management Corporation; Director, The Bradford Funds, Inc. Morgan R. Jones -58 Secretary Chairman of the law firm Drinker Biddle & Reath of Drinker Biddle & Reath LLP LLP; Director, Rocking 1345 Chestnut Street Horse Child Care Centers Philadelphia, PA of America, Inc. 19107-3496
______________________ -18- * Mr. Reichman is an "interested person" of RBB, as that term is defined in the 1940 Act, by virtue of his positions with Counsellors Securities Inc., RBB's distributor. ** Mr. Sablowsky is an "interested person" of RBB, as that term is defined in the 1940 Act, by virtue of his position with Fahnestock Co., Inc., a registered broker-dealer. Messrs. McKay, Sternberg and Brodsky are members of the Audit Committee of the Board of Directors. The Audit Committee, among other things, reviews results of the annual audit and recommends to RBB the firm to be selected as independent auditors. Messrs. Reichman, McKay and van Roden are members of the Executive Committee of the Board of Directors. The Executive Committee may generally carry on and manage the business of RBB when the Board of Directors is not in session. Messrs. McKay, Sternberg, Brodsky and van Roden are members of the Nominating Committee of the Board of Directors. The Nominating Committee recommends to the Board all persons to be nominated as directors of RBB. RBB pays directors who are not "affiliated persons" (as that term is defined in the 1940 Act) of any investment adviser or sub-adviser of the Fund or the Distributor and Mr. Sablowsky, who is considered to be an affiliated person, $12,000 annually and $1,000 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 $5,000 per year for his services in this capacity. Directors who are not affiliated persons of RBB and Mr. Sablowsky are reimbursed for any expenses incurred in attending meetings of the Board of Directors or any committee thereof. For the year ended August 31, 1997, each of the following members of the Board of Directors received compensation from RBB in the following amounts: -19- Directors' Compensation -----------------------
Pension or Total Retirement Compensation Benefits Estimated from Aggregate Accrued as Annual Registrant Compensation Part of Benefits and Fund Name of from Fund Upon Complex/1/ Paid Person/Position Registrant Expenses Retirement to Directors - ---------------- ------------ ----------- ---------- --------------- Julian A. Brodsky, $16,000 N/A N/A $16,000 Director Francis J. McKay, $19,000 N/A N/A $19,000 Director Arnold M. Reichman, $ 0 N/A N/A $ 0 Director Robert Sablowsky, $ 8,000 N/A N/A $ 8,000 Director Marvin E. Sternberg, $19,000 N/A N/A $19,000 Director Donald van Roden, $24,000 N/A N/A $24,000 Director and Chairman
______________________ /1/ A Fund Complex means two or more investment companies that hold themselves out to investors as related companies for purposes of investment and investor services, or have a common investment adviser or have an investment adviser that is an affiliated person of the investment adviser of any other investment companies. 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 and one other employee), 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 two part-time employees. 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. 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 December 1, 1997. -20- 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. For the fiscal year ended August 31, 1997 and for the following fiscal year, Numeric intends to waive its fees to the extent necessary to maintain an annualized expense ratio for each Fund of 1.00%. There can be no assurance that Numeric will continue such waivers indefinitely. For the period from June 3, 1996 (initial public offering Shares) through August 31, 1996 and for the fiscal year ended August 31, 1997, the Funds paid Numeric advisory fees and Numeric waived advisory fees as follows:
Advisory Fees Paid (after waivers and Fund reimbursements) Waivers Reimbursements ---- --------------- ------- -------------- Fiscal year ended August 31, 1997 Micro Cap $248,284 $120,320 $ 0 Growth $355,843 $153,302 $ 0 Growth & Value $ 90,762 $ 92,307 $21,893 Period ended August 31, 1996 Micro Cap $ 0 $ 13,959 $16,152 Growth $ 3,225 $ 20,371 $13,652 Growth & Value $ 0 $ 3,693 $21,812
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 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 -21- 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 Growth & Value 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 approved on October 15, 1997. 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 Growth & Value 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 Growth & Value 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 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 -22- 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. 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 the RBB's Board of Directors concerning the Funds' operations. CTC is authorized to select one or more banks or trust companies to serve as sub-custodian on behalf of the Funds, provided that CTC remains responsible for the performance of all its duties under the Custodian Agreements and holds RBB harmless from the acts and omissions of any sub-custodian. For its services to the Funds under the Custodian Agreements, CTC receives a fee calculated as .015% of each Fund's average daily gross assets, with a minimum monthly fee of $417 per Fund, exclusive of transaction charges and out-of-pocket expenses, which are also charged to the Funds. Transfer Agency Agreements PFPC Inc. ("PFPC"), an affiliate of PNC Bank, serves as the transfer and dividend disbursing agent for the Funds pursuant to a Transfer Agency Agreement dated August 16, 1988, 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 $12 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 -23- 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 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. For the period from June 3, 1996 (initial public offering of shares) until August 31, 1996 and for the fiscal year ended August 31, 1997, the Funds paid administration fees to PFPC and BSFM, and PFPC and BSFM waived administration fees as follows: -24-
Co-Administration Fees Paid Fund (After Waivers) Waivers Reimbursements ---- ----------------- ------- -------------- For the fiscal year ended August 31, 1997. (PFPC) - ------ Micro Cap $61,461 $26,117 $0 Growth $73,540 $20,169 $0 Growth & Value $39,724 $35,276 $0 (BSFM) - ------ Micro Cap $24,574 $ 0 $0 Growth $33,943 $ 0 $0 Growth & Value $12,204 $ 0 $0
Co- Administration Fees Paid Fund (After Waivers) Waivers Reimbursements ---- --------------- ------- -------------- For the period from June 3, 1996 until August 31, 1996. (PFPC) - ------ Micro Cap $9,062 $9,063 $0 Growth $9,062 $9,063 $0 Growth & Value $8,958 $8,959 $0 (BSFM) - ------ Micro Cap $ 930 $ 0 $0 Growth $ 712 $ 0 $0 Growth & Value $ 246 $ 0 $0
-25- Administrative Services Agent Counsellors Funds Service, Inc. ("Counsellors Service"), a wholly-owned subsidiary of Warburg Pincus Asset Management, Inc. ("Warburg"), provides certain administrative services to each of the Funds that are not provided by BSFM or PFPC, subject to the supervision and direction of the Board of Directors of RBB. Warburg is indirectly controlled by Warburg, Pincus & Co. These services include furnishing certain internal quasi-legal, executive and administrative services, acting as liaison between the Funds and the Funds' various service providers, furnishing corporate secretarial services, which include assisting in the preparation of materials for meetings of RBB's Board of Directors, coordinating the preparation of proxy statements and annual, semi- annual and quarterly reports and generally assisting in monitoring and developing compliance procedures for the Funds. As compensation for such administrative services, Counsellors Service is entitled to a monthly fee calculated at the annual rate of .15% of each Fund's average daily net assets. Counsellors is currently waiving fees in excess of .03% of each Fund's average daily net assets. For the period from June 3, 1996 (initial public offering of shares) through August 31, 1996 and for the fiscal year ended August 31, 1997, the Funds paid administration fees to Counsellors Service, and Counsellors Service waived administration fees as follows: -26-
Administrative Services Fees Paid Fund (after waivers) Waivers Reimbursements ---- ------------------ ------- -------------- For the fiscal year ended August 31, 1997. Micro Cap $14,744 $58,977 $0 Growth $20,366 $81,463 $0 Growth & Value $ 7,323 $29,291 $0 For the period ended August 31, 1996. Micro Cap $ 558 $ 2,231 $0 Growth $ 934 $ 3,785 $0 Growth & Value $ 147 $ 591 $0
Distributor Counsellors Securities Inc. ("Counsellors" or the "Distributor") serves as distributor of the Shares. Counsellors is a wholly-owned subsidiary of Warburg and has a principal business address at 466 Lexington Avenue, New York 10017- 3147. No compensation is payable by RBB to Counsellors for distribution services with respect to the Funds. FUND TRANSACTIONS Subject to policies established by the Board of Directors, Numeric is responsible for the execution of portfolio transactions and the allocation of brokerage transactions for the Funds. In executing portfolio transactions, Numeric seeks to obtain the best 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 -27- 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, 1997, the Funds paid commissions to brokers on account of research services as follows:
Amount of Aggregate Fund Transactions Commissions - ---- ------------ ----------- Micro Cap $10,385,165 $16,350 Growth 20,192,674 27,840 Growth & Value 12,876,177 14,821
Corporate debt and U.S. Government securities and many micro- and small-cap stocks are generally traded on the over-the-counter market on a "net" basis without a stated commission, through dealers acting for their own account and not as brokers. The Funds will primarily engage in transactions with these dealers or deal directly with the issuer unless a better price or execution could be obtained by using a broker. Prices paid to a dealer in debt, micro- or small-cap securities will generally include a "spread," which is the difference between the prices at which the dealer is willing to purchase and sell the specific security at the time, and includes the dealer's normal profit. Numeric may seek to obtain an undertaking from issuers of commercial paper or dealers selling commercial paper to consider the repurchase of such securities from the Funds prior to their maturity at their original cost plus interest (sometimes adjusted to reflect the actual maturity of the securities), if it believes that the Funds' anticipated need for liquidity makes such action desirable. Any such repurchase prior to maturity reduces the possibility that the Funds would incur a capital loss in liquidating commercial paper (for which there is no established -28- 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 Counsellors Securities, PNC Bank or Numeric or any affiliated person of the foregoing entities except as permitted by SEC exemptive order or by applicable law. A high (100% or more) rate of portfolio turnover involves correspondingly greater brokerage commission expenses and other transaction costs, which must be borne directly by a Fund. Federal income tax laws may restrict the extent to which a Fund may engage in short term trading of securities. See "Taxes." The Funds anticipate that their annual portfolio turnover rates will vary from year to year, but will generally range between 150% and 300%. The portfolio turnover rate is calculated by dividing the lesser of a Fund's annual sales or purchases of portfolio securities (exclusive of purchases or sales of securities whose maturities at the time of acquisition were one year or less) by the monthly average value of the securities in the portfolio during the year. For the fiscal year ended August 31, 1997, the Funds paid brokerage commissions on behalf of the Funds as follows:
Fund Brokerage Commissions - ---- --------------------- Micro Cap $216,002 Growth $308,925 Growth & Value $126,534
-29- 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, 1997, the following Funds held the following securities:
Fund Security Value ---- -------- ----- Growth & Value Salomon Brothers $257,463 Growth & Value The Bear Stearns $859,614 Companies, Inc.
PURCHASE AND REDEMPTION INFORMATION The Funds reserve the right, if conditions exist that make cash payments undesirable, to honor any request for redemption or repurchase of a Fund's shares by making payment in whole or in part in securities chosen by RBB and valued in the same way as they would be valued for purposes of computing a Fund's net asset value. If payment is made in securities, a shareholder may incur transaction costs in converting these securities into cash. RBB has elected, however, to be governed by Rule 18f-1 under the 1940 Act so that a Fund is obligated to redeem its shares solely in cash up to the lesser of $250,000 or 1% of its net asset value during any 90-day period for any one shareholder of a Fund. Under the 1940 Act, a Fund may suspend the right to redemption or postpone the date of payment upon redemption for any period during which the New York Stock Exchange (the "NYSE") is closed (other than customary weekend and holiday closings), or during which 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. -30- 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, 1997, is as follows:
Micro Growth & Cap Growth Value ------------ ------------ ----------- Net assets............ $142,119,499 $117,723,898 $52,490,820 Outstanding shares.... 7,694,317 7,226,740 3,059,247 Net asset value per share................ $ 18.47 $ 16.29 $ 17.16 Maximum sales charge.. -- -- -- Maximum Offering Price to Public...... $ 18.47 $ 16.29 $ 17.16
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 -31- maturity. Net asset value per share is calculated by adding the value of each Fund's securities, cash and other 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 -32- 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 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 grater or less than the average for the entire period. When considering total return figures for periods shorter than one year, investors should bear in mind that the Funds seek long-term appreciation and that such return may not be representative of a Fund's return over a longer market cycle. The Funds may also -33- advertise aggregate total return figures for various periods, representing the cumulative change in value of an investment in a Fund for the specific period (again reflecting changes in a Fund's share prices and assuming reinvestment of dividends and distributions). Aggregate and average total returns may be shown by means of schedules, charts or graphs, may indicate various components of total return (i.e., change in value of initial investment, income dividends and capital gain distributions) and would be quoted separately for each class of a Fund's shares. Calculated according to the SEC Rules, the average annual total return for the Funds was as follows:
Average Fund Return - ------------------------------------------ -------------------------------- For the fiscal year ended August 31, 1997. Micro Cap 58.41% Growth 37.69% Growth & Value 49.11% For the period June 3, 1996 (initial public offering) to August 31, 1996. Micro Cap 41.43% Growth 27.86% Growth & Value 33.71%
Calculated according to the above formula, the aggregate total return for the Funds was as follows: -34-
Aggregate Fund Return - ----------------------------------------- --------------------------------- For the fiscal year ended August 31, 1997. Micro Cap 58.41% Growth 37.69% Growth & Value 49.11% For the period June 3, 1996 (initial public offering) to August 31, 1997. Micro Cap 54.05% Growth 35.85% Growth & Value 43.64%
Investors should note that total return figures are based on historical earnings and are not intended to indicate future performance. In reports or other communications to investors or in advertising material, the Funds may describe general economic and market conditions affecting the Funds and may compare their performance with (1) that of other mutual funds as listed in the rankings prepared by Lipper Analytical Services, Inc. or similar investment services that monitor the performance of mutual funds or as set forth in the publications listed below; (2) with their benchmark indices, as well as the S&P 500 or (3) other appropriate indices of investment securities or with data developed by Numeric derived from such indices. Performance information may also include evaluation of the Funds by nationally recognized ranking services and information as reported in financial publications such as Business Week, Fortune, Institutional Investor, Money Magazine, Forbes, Barron's, The Wall Street Journal, The New York Times, or other national, regional or local publications. In reports or other communications to investors or in advertising, the Funds may also describe the general biography or work experience of the portfolio managers of the Funds and may include quotations attributable to the portfolio managers describing approaches taken in managing the Funds' investments, research methodology, underlying stock selection or the Funds' investment objective. The Funds may also discuss the continuum of risk and return relating to different investments, and the potential impact of foreign stock on a portfolio otherwise composed of domestic securities. In addition, the Funds may from time to time compare their expense ratios to those of investment -35- companies with similar objective and policies, as advertised by Lipper Analytical Services, Inc. or similar investment services that monitor mutual funds. TAXES The following is only a summary of certain additional tax considerations generally affecting the Funds and their shareholders that are not described in the Prospectus. No attempt is made to present a detailed explanation of the tax treatment of the Funds or their shareholders, and the discussion in this Statement of Additional Information and in the Prospectus is not intended as a substitute for careful tax planning. Investors are urged to consult their tax advisers with specific reference to their own tax situation. Each Fund has elected to be taxed as a regulated investment company under Part I of Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"). As a regulated investment company, each Fund is exempt from federal income tax on its net investment income and realized capital gains which it distributes to shareholders, provided that it (a) distributes an amount equal to the sum of (i) at least 90% of its investment company taxable income (net taxable investment income and the excess of net short-term capital gain over net long-term capital loss), if any, for the year and (ii) at least 90% of its net tax-exempt interest income, if any, for the year (the "Distribution Requirement"), and (b) satisfies certain other requirements of the Code that are described below. Distributions of investment company taxable income and net tax- exempt interest income made during the taxable year or, under specified circumstances, within twelve months after the close of the taxable year will satisfy the Distribution Requirement. The Distribution Requirement for any year may be waived if a regulated investment company establishes to the satisfaction of the Internal Revenue Service that it is unable to satisfy the Distribution Requirement by reason of distributions previously made for the purpose of avoiding liability for federal excise tax (discussed below). In addition to satisfaction of the Distribution Requirement each Fund must derive at least 90% of its gross income from dividends, interest, certain payments with respect to securities loans and gains from the sale or other disposition of stock or securities or foreign currencies, or from other income derived with respect to its business of investing in such stock, securities, or currencies (the "Income Requirement"). Future Treasury regulations may provide that currency gains that are not "directly related" to a Fund's principal business of investing in stock or securities (or in options or -36- futures with respect to stock or securities) will not satisfy the Income Requirements. Income derived by a regulated investment company from a partnership or trust (including a foreign entity that is classified as a partnership or trust for U.S. federal income tax purposes) will satisfy the Income Requirement only to the extent such income is attributable to items of income of the partnership or trust that would satisfy the Income Requirement if they were realized by a regulated investment company in the same manner as realized by the partnership or trust. In addition to the foregoing requirements, at the close of each quarter of its taxable year, at least 50% of the value of each Fund's assets must consist of cash and cash items, U.S. Government securities, securities of other regulated investment companies, and securities of other issuers (as to which the Fund has not invested more than 5% of the value of its total assets in securities of such issuer and as to which the Fund does not hold more than 10% of the outstanding voting securities of such issuer), and no more than 25% of the value of each Fund's total assets may be invested in the securities of any one issuer (other than U.S. Government securities and securities of other regulated investment companies), or in two or more issuers which such Fund controls and which are engaged in the same or similar trades or businesses (the "Asset Diversification Requirement"). The Internal Revenue Service has taken the position, in informal rulings issued to other taxpayers, that the issuer of a repurchase agreement is the bank or dealer from which securities are purchased. A Fund will not enter into repurchase agreements with any one bank or dealer if entering into such agreements would, under the informal position expressed by the Internal Revenue Service, cause it to fail to satisfy the Asset Diversification Requirement. Distributions of investment company taxable income will be taxable (subject to the possible allowance of the dividend received deduction described below) to shareholders as ordinary income, regardless of whether such distributions are paid in cash or are reinvested in shares. Shareholders receiving any distribution from RBB in the form of additional shares will be treated as receiving a taxable distribution in an amount equal to the fair market value of the shares received, determined as of the reinvestment date. Each Fund intends to distribute to shareholders its excess of net long-term capital gain over net short-term capital loss ("net capital gain"), if any, for each taxable year. Such gain is distributed as a capital gain dividend and is taxable to shareholders as long-term or mid-term capital gain, to the extent attributable to long-term or mid-term capital gain of the Fund, as the case may be, regardless of the length of time -37- the shareholder has held his shares, whether such gain was recognized by the Fund prior to the date on which a shareholder acquired shares of the Fund and whether the distribution was paid in cash or reinvested in shares. The aggregate amount of distributions designated by any Fund as capital gain dividends may not exceed the net capital gain of such Fund for any taxable year, determined by excluding any net capital loss or net long-term capital loss attributable to transactions occurring after October 31 of such year and by treating any such loss as if it arose on the first day of the following taxable year. A similar limitation applies to the portion of such capital gain dividends that may be designated by the Fund as long-term capital gain dividends as opposed to mid- term capital gain dividends. All designations of capital gain dividends will be made in a written notice mailed by RBB to shareholders not later than 60 days after the close of each Fund's respective taxable year. In the case of corporate shareholders, distributions (other than capital gain dividends) of a Fund for any taxable year will qualify for the 70% dividends received deduction, only to the extent of the gross amount of "qualifying dividends" received by such Fund for the year. Generally, a dividend will be treated as a "qualifying dividend" only if it has been received from a domestic corporation. However, if a Fund owns at least 10 percent of the stock (by vote and value) of certain foreign corporations with U.S. source income, then a portion of the dividends paid by such foreign corporations may constitute "qualifying dividends." A dividend received by a taxpayer will not be treated as a "qualifying dividend" if (1) it has been received with respect to any share of stock that the taxpayer has held for 45 days (90 days in the case of certain preferred stock) or less (excluding any day more than 45 days (or 90 days in the case of certain preferred stock) after the date on which the stock becomes ex-dividend), or (2) to the extent that the taxpayer is under an obligation (pursuant to a short sale or otherwise) to make related payments with respect to positions in substantially similar or related property. RBB will designate the portion, if any, of the distribution made by a Fund that qualifies for the dividends received deduction in a written notice mailed by RBB to shareholders not later than 60 days after the close of the Fund's taxable year. Investors should be aware that any loss realized upon the sale, exchange or redemption of shares held for six months or less will be treated as a long-term capital loss to the extent any capital gain dividends have been paid with respect to such shares. Corporate taxpayers may be liable for alternative minimum tax, which is imposed at the rate of 20% of "alternative minimum taxable income" (less, in the case of corporate shareholders with "alternative minimum taxable income" of less -38- than $310,000, the applicable "exemption amount"), in lieu of the regular corporate income tax. "Alternative minimum taxable income," is equal to "taxable income", (as determined for corporate income regular tax purposes) with certain adjustments. Although corporate taxpayers in determining "alternative minimum taxable income" are allowed to exclude exempt interest dividends (other than exempt interest dividends derived from certain private activity bonds ("AMT Preference Dividends"), as explained in the Prospectus) and to utilize the 70% dividends received deduction at the first level of computation, the Code requires (as a second computational step) that "alternative minimum taxable income" be increased by 75% of the excess of "adjusted current earnings" over other "alternative minimum taxable income." Corporate shareholders will have to take into account (1) all exempt interest dividends and (2) the full amount of all dividends from a Fund that are treated as "qualifying dividends" for purposes of the dividends received deduction in determining their "adjusted current earnings." As much as 75% of any exempt interest dividend and 82.5% of any "qualifying dividend" received by a corporate shareholder could, as a consequence, be subject to alternative minimum tax. Exempt interest dividends received by such a corporate shareholder may accordingly be subject to alternative minimum tax at an effective rate of 15%. If for any taxable year any Fund does not qualify as a regulated investment company, all of its taxable income will be subject to tax at regular corporate rates without any deduction for distributions to shareholders, and all distributions will be taxable as ordinary dividends to the extent of such Fund's current and accumulated earning and profits. Such distributions will be eligible for the dividends received deduction in the case of corporate shareholders. Investors should be aware that any loss realized on a sale of shares of a Fund will be disallowed to the extent an investor repurchases shares of the same Fund within a period of 61 days (beginning 30 days before and ending 30 days after the day of disposition of the shares). Dividends paid by a Fund in the form of shares within the 61-day period would be treated as a purchase for this purpose. A Shareholder will recognize gain or loss upon an exchange of shares of a Fund for shares of another Fund upon exercise of an exchange privilege. Shareholders may not include the initial sales charge in the tax basis of the Shares exchanged for shares of another Fund for the purpose of determining gain or loss on the exchange, where the Shares exchanged have been held 90 days or less. The sales charge will increase the basis of the shares acquired through exercise of the exchange privilege (unless the shares acquired are also exchanged for shares of another Fund within 90 days after the first exchange). -39- The Code imposes a non-deductible 4% excise tax on regulated investment companies that do not distribute with respect to each calendar year an amount equal to 98% of their ordinary income for the calendar year plus 98% of their capital gain net income for the one-year period ending on October 31 of such calendar year. The balance of such income must be distributed during the next calendar year. For the foregoing purposes, a company is treated as having distributed any amount on which it is subject to income tax for any taxable year ending in such calendar year. Because each Fund intends to distribute all of its taxable income currently, no Fund anticipates incurring any liability for this excise tax. However, investors should note that a Fund may in certain circumstances be required to liquidate investments in order to make sufficient distributions to avoid excise tax liability. RBB will be required in certain cases to withhold and remit to the United States Treasury 31% of dividends paid to any shareholder (1) who has provided either an incorrect tax identification number or no number at all, (2) who is subject to backup withholding by the Internal Revenue Service for failure to report the receipt of interest or dividend income properly, or (3) who has failed to certify to RBB that he is not subject to backup withholding or that he is an "exempt recipient." The foregoing general discussion of federal income tax consequences is based on the Code and the regulations issued thereunder as in effect on the date of this Statement of Additional Information. Future legislative or administrative changes or court decisions may significantly change the conclusions expressed herein, and any such changes or decisions may have a retroactive effect with respect to the transactions contemplated herein. Although each Fund expects to qualify as a "regulated investment company" and to be relieved of all or substantially all federal income taxes, depending upon the extent of its activities in states and localities in which its offices are maintained, in which its agents or independent contractors are located or in which it is otherwise deemed to be conducting business, each Fund may be subject to the tax laws of such states or localities. Certain states exempt from state income taxation dividends paid by a regulated investment company that are derived from interest on U.S. Government obligations. Each Fund will accordingly inform its shareholders annually of the percentage, if any, of its ordinary dividends that is derived from interest on U.S. Government obligations. Shareholders should consult with their tax advisers as to the availability and extent of any applicable state income tax exemption. -40- DESCRIPTION OF SHARES RBB has authorized capital of thirty billion shares of Common Stock, $.001 par value per share, of which 13.93 billion shares are currently classified in 82 classes as follows: 100 million shares are classified as Class A Common Stock (Growth & Income), 100 million shares are classified as Class B Common Stock, 100 million shares are classified as Class C Common Stock (Balanced), 100 million shares are classified as Class D Common Stock (Tax-Free), 500 million shares are classified as Class E Common Stock (Money), 500 million shares are classified as Class F Common Stock (Municipal Money), 500 million shares are classified as Class G Common Stock (Money), 500 million shares are classified as Class H Common Stock (Municipal Money), 1 billion shares are classified as Class I Common Stock (Money), 500 million shares are classified as Class J Common Stock (Municipal Money), 500 million shares are classified as Class K Common Stock (Government Money), 1,500 million shares are classified as Class L Common Stock (Money), 500 million shares are classified as Class M Common Stock (Municipal Money), 500 million shares are classified as Class N Common Stock (Government Money), 500 million shares are classified as Class O Common Stock (N.Y. Money), 100 million shares are classified as Class P Common Stock (Government), 100 million shares are classified as Class Q Common Stock, 500 million shares are classified as Class R Common Stock (Municipal Money), 500 million shares are classified as Class S Common Stock (Government Money), 500 million shares are classified as Class T Common Stock (International), 500 million shares are classified as Class U Common Stock (High Yield), 500 million shares are classified as Class V Common Stock (Emerging), 100 million shares are classified as Class W Common Stock, 50 million shares are classified as Class X Common Stock (U.S. Core Equity), 50 million shares are classified as Class Y Common Stock (U.S. Core Fixed Income), 50 million shares are classified as Class Z Common Stock (Strategic Global Fixed Income), 50 million shares are classified as Class AA Common Stock (Municipal Bond), 50 million shares are classified as Class BB Common Stock (BEA Balanced), 50 million shares are classified as Class CC Common Stock (Short Duration), 100 million shares are classified as Class DD Common Stock, 100 million shares are classified as Class EE Common Stock, 50 million shares are classified as Class FF Common Stock (n/i numeric investors Micro Cap), 50 million shares are classified as Class GG Common Stock (n/i numeric investors Growth), 50 million shares are classified as Class HH (n/i numeric investors Growth & Value), 100 million shares are classified as Class II Common Stock (BEA Investor International), 100 million shares are classified as Class JJ Common Stock (BEA Investor Emerging), 100 million shares are classified as Class KK Common Stock (BEA Investor High Yield), 100 million shares are classified as Class LL Common Stock (BEA Investor Global Telecom), 100 million shares are -41- classified as Class MM Common Stock (BEA Advisor International), 100 million shares are classified as Class NN Common Stock (BEA Advisor Emerging), 100 million shares are classified as Class OO Common Stock (BEA Advisor High Yield), 100 million shares are classified as Class PP Common Stock (BEA Advisor Global Telecom), 100 million shares are classified as Class QQ Common Stock (Boston Partners Institutional Large Cap), 100 million shares are classified as Class RR Common Stock (Boston Partners Investor Large Cap), 100 million shares are classified as Class SS Common Stock (Boston Partners Advisor Large Cap), 100 million shares are classified as Class TT Common Stock (Boston Partners Investor Mid Cap), 100 million shares are classified as Class UU Common Stock (Boston Partners Institutional Mid Cap), 100 million shares are classified as Class VV Common Stock (Boston Partners Bond), 100 million shares are classified as Class WW Common Stock (Boston Partners Investor Bond), 50 million shares are classified as Class XX Common Stock (n/i numeric investors Larger Cap Value), 700 million shares are classified as Class Janney Money Common Stock (Money), 200 million shares are classified as Class Janney Municipal Money Common Stock (Municipal Money), 500 million shares are classified as Class Janney Government Money Common Stock (Government Money), 100 million shares are classified as Class Janney N.Y. Municipal Money Common Stock (N.Y. Money), 1 million shares are classified as Class Beta 1 Common Stock (Money), 1 million shares are classified as Class Beta 2 Common Stock (Municipal Money), 1 million shares are classified as Class Beta 3 Common Stock (Government Money), 1 million shares are classified as Class Beta 4 Common Stock (N.Y. Money), 1 million shares are classified as Gamma 1 Common Stock (Money), 1 million shares are classified as Gamma 2 Common Stock (Municipal Money), 1 million shares are classified as Gamma 3 Common Stock (Government Money), 1 million shares are classified as Gamma 4 Common Stock (N.Y. Money), 1 million shares are classified as Delta 1 Common Stock (Money), 1 million shares are classified as Delta 2 Common Stock (Municipal Money), 1 million shares are classified as Delta 3 Common Stock (Government Money), 1 million shares are classified as Delta 4 Common Stock (N.Y. Money), 1 million shares are classified as Epsilon 1 Common Stock (Money), 1 million shares are classified as Epsilon 2 Common Stock (Municipal Money), 1 million shares are classified as Epsilon 3 Common Stock (Government Money), 1 million shares are classified as Epsilon 4 Common Stock (N.Y. Money), 1 million shares are classified as Zeta 1 Common Stock (Money), 1 million shares are classified as Zeta 2 Common Stock (Municipal Money), 1 million shares are classified as Zeta 3 Common Stock (Government Money), 1 million shares are classified as Zeta 4 Common Stock (N.Y. Money), 1 million shares are classified as Eta 1 Common Stock (Money), 1 million shares are classified as Eta 2 Common Stock (Municipal Money), 1 million shares are classified as Eta 3 Common Stock (Government Money), 1 million shares are classified as Eta 4 Common Stock (N.Y. Money), 1 million shares are classified as Theta 1 Common Stock (Money), 1 million shares are classified as Theta 2 Common Stock (Municipal Money), 1 million -42- shares are classified as Theta 3 Common Stock (Government Money), and 1 million shares are classified as Theta 4 Common Stock (N.Y. Money). Shares of the Classes FF, GG, HH and XX Common Stock constitute the n/i numeric investors Micro Cap, Growth, Growth & Value and Larger Cap Funds, respectively. Under RBB's charter, the Board of Directors has the power to classify or reclassify any unissued shares of Common Stock from time to time. The classes of Common Stock have been grouped into fourteen separate "families": the Cash Preservation Family, the Sansom Street Family, the Bedford Family, the BEA Family, the Janney Montgomery Scott Money Family, the n/i numeric investors family of funds, the Boston Partners Family, the Beta Family, the Gamma Family, the Delta Family, the Epsilon Family, the Zeta Family, the Eta Family and the Theta Family. The Cash Preservation Family represents interests in the Money Market and Municipal Money Market Funds; the Sansom Street Family represents interests in the Money Market, Municipal Money Market and Government Obligations Money Market Funds; Bedford Family represents interests in the Money Market, Municipal Money Market, Government Obligations Money Market and New York Municipal Money Market Funds; the BEA Family represents interests in ten non- money market portfolios; the n/i numeric investors family of funds represents interests in four non-money market portfolios; the Boston Partners Family represents interest in three non-money market portfolios; the Janney Montgomery Scott Family and the Beta, Gamma, Delta, Epsilon, Zeta, Eta and Theta Families represent interests in the Money Market, Municipal Money Market, Government Obligations Money Market and New York Municipal Money Market Funds. ADDITIONAL INFORMATION CONCERNING FUND SHARES RBB does not currently intend to hold annual meetings of shareholders except as required by the 1940 Act or other applicable law. RBB's amended By- Laws provide that shareholders collectively owning at least ten percent of the outstanding shares of all classes of Common Stock of RBB have the right to call for a meeting of shareholders to consider the removal of one or more directors. To the extent required by law, RBB will assist in shareholder communication in such matters. Holders of shares of each class of RBB will vote in the aggregate and not by class on all matters, except where otherwise required by law. Further, shareholders of RBB will vote in the aggregate and not by portfolio except as otherwise required by law or when the Board of Directors determines that the matter to be voted upon affects only the interests of the shareholders of a particular portfolio. Rule 18f-2 under the 1940 Act provides that any matter required to be submitted by the provisions of such Act or applicable state law, or otherwise, to the holders of -43- 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 by the 1940 Act) of such portfolio. However, the Rule also provides that the ratification of the selection of independent public accountants, the approval of principal underwriting contracts and the election of directors are not subject to the separate voting requirements and may be effectively acted upon by shareholders of an investment company voting without regard to portfolio. Notwithstanding any provision of Maryland law requiring a greater vote of shares of RBB's common stock (or of any class voting as a class) in connection with any corporate action, unless otherwise provided by law or by RBB's Charter, RBB may take or authorize such action upon the favorable vote of the holders of more than 50% of all of the outstanding shares of Common Stock entitled to vote on the matter 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. MISCELLANEOUS Counsel. The law firm of Drinker Biddle & Reath LLP, 1100 Philadelphia National Bank Building, 1345 Chestnut Street, Philadelphia, Pennsylvania 19107- 3496, serves as counsel to RBB and RBB's non-interested directors. Independent Accountants. Coopers & Lybrand L.L.P., 2400 Eleven Penn Center, Philadelphia, Pennsylvania 19103, serves as RBB's independent accountants. Control Persons. As of November 15, 1997, to RBB's knowledge, the following named persons at the addresses shown below owned of record approximately 5% or more of the total outstanding shares of the class of RBB indicated below. See "Description of Shares" above. RBB does not know whether such persons also beneficially own such shares. -44-
PERCENT PORTFOLIO NAME AND ADDRESS OWNED - --------- ---------------- -------- Cash Preservation Jewish Family and Children's 44.2% Money Market Portfolio Agency of Philadelphia (Class G) Capital Campaign Attn: S. Ramm 1610 Spruce Street Philadelphia, PA 19103 Dominic and Barbara Pisciotta 15.9% and Successors in Trust under the Dominic and Barbara Pisciotta Caring Trust 207 Woodmere Way St. Charles, MO 63303 Cash Preservation Kenneth Farwell and Valerie 11.3% Municipal Money Market Farwell JTTEN Portfolio 3854 Sullivan (Class H) St. Louis, MO 63107 Gary L. Lange and 32.6% Susan D. Lange JTTEN 1354 Shady Knoll Ct. Longwood, FL 32750 Andrew Diederich and 6.2% Doris Diederich JTTEN 1003 Lindeman Des Peres, MO 63131 Gwendolyn Haynes 5.2% 2757 Geyer St. Louis, MO 63104 Savannah Thomas Trust 6.3% 200 Madison Ave. Rock Hill, MD 63119 Sansom Street Money Wasner & Co. 32.6% Market Portfolio FAO Paine Webber and Managed (Class I) Assets Sundry Holdings Attn: Joe Domizio 200 Stevens Drive Lester, PA 19113 Saxon and Co. 65.5% FBO Paine Webber P.O. Box 7780 1888 Philadelphia, PA 19182
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PERCENT PORTFOLIO NAME AND ADDRESS OWNED - --------- ---------------- -------- BEA International Blue Cross & Blue Shield of 6.10% Equity - Institutional Massachusetts Inc. Class Retirement Income Trust (Class T) 100 Summer Street Boston, MA 02110-2106 Credit Suisse Private Banking 6.89% Dividend Reinvest Plan c/o Credit Suisse PVT PKG 12 E. 49th Street, 40th Fl. New York, NY 10017-1028 Indiana University Foundation 5.49% Attn: Walter L. Koon, Jr. P.O. Box 500 Bloomington, IN 47402-0500 Employees Ret. Plan Marshfield 5.31% Clinic 1000 N. Oak Avenue Marshfield, WI 54449 State Street Bank & Trust 5.06% FBC Consumers Energy DTD 3-1-1997 P.O. Box 1992 Boston, MA 02105-1992 BEA International Bob & Co. 87.30% Equity Portfolio - P.O. Box 1809 Advisor Class (Class Boston, MA 02105-1809 MM) TRANSCORP 10.78% FBO William E. Burns P.O. Box 6535 Englewood, CO 80155-6535 BEA High Yield Fidelity Investments 15.61% Portfolio - Institutional Institutional Class Operations Co. Inc. as Agent for (Class U) Certain Employee Benefit Plan 100 Magellan Way #KWIC Covington, KY 41015-1987 Guenter Full Trust Michelin 17.31% North America Inc. Master Trust P.O. Box 19001 Greenville, SC 29602-9001
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PERCENT PORTFOLIO NAME AND ADDRESS OWNED - --------- ---------------- -------- C S First Boston Pension Fund 6.15% Park Avenue Plaza, 34th Floor Attn: Steve Medici 55 E. 52nd Street New York, NY 10055-0002 Southdown Inc. Pension Plan 9.65% MAC & Co. Mutual Fund Operations P.O. Box 3198 Pittsburgh, PA 31980 Edward J. Demske TTEE 5.42% Miami University Foundation 202 Roudebush Hall Oxford, OH 45056 BEA High Yield Richard A. Wilson TTEE 10.81% Portfolio - Advisor E. Francis Wilson TTEE Class (Class OO) The Wilson Family Trust 7612 March Avenue West Hills, CA 91304-5232 Charles Schwab & Co. 88.82 Special Custody Account for the Exclusive Benefit of Customers 101 Montgomery St. San Francisco, CA 94104-4122 BEA Emerging Markets Wachovia Bank North Carolina 26.22% Equity Portfolio - Trust for Carolina Power & Light Institutional Class Co. (Class V) Supplemental Retirement Trust 301 N. Main Street Winston-Salem, NC 27101-3819 Hall Family Foundation 38.21% P.O. Box 419580 Kansas City, MO 64141-8400 Arkansas Public Employees 18.33% Retirement System 124 W. Capitol Avenue Little Rock, AR 72201-3704 BEA Emerging Markets Charles Schwab & Co. 22.65% Equity Portfolio - Special Custody Account for the Advisor Class Exclusive Benefit of Customers (Class NN) 101 Montgomery Street San Francisco, CA 94104-4175
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PERCENT PORTFOLIO NAME AND ADDRESS OWNED - --------- ---------------- -------- Donald W. Allgood 72.66% 3106 Johannsen Dr. Burlington, IA 52601-1541 BEA US Core Equity Patterson & Co. 43.71% Portfolio - P.O. Box 7829 Institutional Class Philadelphia, PA 19101-7829 (Class X) Credit Suisse Private Banking 13.51% Dividend Reinvest Plan c/o Credit Suisse PVT BKG 12 E. 49th Street, 40th Fl. New York, NY 10017-1028 Fleet National Bank Trust 5.86% Hospital St. Raphael Malpractice Attn: 1958875020 P.O. Box 92800 Rochester, NY 14692-8900 Werner & Pfleiderer Pension 6.98% Plan Employees 663 E. Crescent Avenue Ramsey, NJ 07446-1220 Washington Hebrew Congregation 11.22% 3935 Macomb St. NW Washington, DC 20016-3799 BEA US Core Fixed New England UFCW & Employers' 24.30% Income Portfolio - Pension Fund Board of Trustees Institutional Class 161 Forbes Road, Suite 201 (Class Y) Braintree, MA 02184-2606 Patterson & Co. 6.50% P.O. Box 7829 Philadelphia, PA 19101-7829 MAC & Co 5.07% Mutual Funds Operations P.O. Box 3198 Pittsburgh, PA 15230-3198
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PERCENT PORTFOLIO NAME AND ADDRESS OWNED - --------- ---------------- -------- Fidelity Investments 9.70% Institutional Operations Co. Inc. (FIIOC) as Agent for Credit Suisse First Boston Employee's Savings PSP 100 Magellan Way #KWIC Covington, KY 41015-1987 DCA Food Industries Inc. 8.95% 100 East Grand Avenue Beloit, WI 53511-6255 State St. Bank & Trust TTE 6.57% Fenway Holdings LLC Master Trust P.O. Box 470 Boston, MA 02102-0470 The Valley Foundation 6.47% c/o Enterprise Trust 16450 Los Gatos Boulevard Suite 210 Los Gatos, CA 95032-5594 BEA Strategic Global Sunkist Master Trust 32.35% Fixed Income Portfolio 14130 Riverside Drive (Class Z) Sherman Oaks, CA 91423-2313 Patterson & Co. 23.13% P.O. Box 7829 Philadelphia, PA 19101-7829 Key Trust Co. of Ohio 18.70% FBO Eastern Enterp. Collective Inv. Trust P.O. Box 94870 Cleveland, OH 44101-4870 Hard & Co. 17.34% Trust for Abtco Inc. Retirement Plan c/o Associated Bank, N.A. 100 W. Wisconsin Ave. Neenah, WI 54956-3012 BEA Municipal Bond William A. Marquard 39.48% Fund Portfolio (Class 2199 Maysville Rd. AA) Carlisle, KY 40311-9716
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PERCENT PORTFOLIO NAME AND ADDRESS OWNED - --------- ---------------- -------- Arnold Leon 13.16% c/o Fiduciary Trust Company P.O. Box 3199 Church Street Station New York, NY 10008-3199 Irwin Bard 6.51% 1750 North East 183rd St. North Miami Beach, FL 33179-4908 S. Finkelstein Family Fund 5.01% 1755 York Ave., Apt. 35 BC New York, NY 10128-6827 BEA Global Tele- E. M. Warburg Pincus & Co. Inc. 17.48% communications 466 Lexington Ave. Portfolio - Advisor New York, NY 10017-3140 Class (Class PP) Bea Associates 401K 11.82% 153 East 53rd Street New York, NY 10022-4611 John B. Hurford 47.62% 153 E. 53rd St., Flr. 57 New York, NY 10022-4611 n/i numeric investors Charles Schwab & Co. Inc. 15.3% Micro Cap Fund Special Custody Account for the (Class FF) Exclusive Benefit of Customers Attn: Mutual Funds 101 Montgomery Street San Francisco, CA 94104 Public Inst. for Social Security 6.1% 1001 19th Street N, 16th Floor Arlington, VA 22209 Portland General Corp. 13.7% Invest Trust DTD 01/29/90 Attn: William J. Valach 121 SW Salmon Street Portland, OR 97202
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PERCENT PORTFOLIO NAME AND ADDRESS OWNED - --------- ---------------- -------- State Street Bank and 7.0% Trust Company FBO Yale Univ Ret Pln for Staff Emp State Street Bank & Trust Co. Master TR Div Attn: Kevin Sutton Solomon Williard Bldg. One Enterprise Dr. North Quincy, MA 02171 n/i numeric investors Charles Schwab & Co. Inc. 18.6% Growth Fund Special Custody Account for the (Class GG) Exclusive Benefit of Customers Attn: Mutual Funds 101 Montgomery Street San Francisco, CA 94104 U.S. Equity Investment Portfolio 6.5% LP c/o Asset Management Advisors Inc. 1001 N. US Hwy 1 STE 800 Jupiter, FL 33477 Portland General Corp. VEBA 5.7% Plan DTD 12/19/90 Attn: William Valach 121 SW Salmon Street Portland, OR 97202 CitiBank FSB 18.9% Sargent & Lundy Retirement Trust C/O CitiCorp Attn: D. Erwin Jr. 1410 N. West Shore Blvd. Tampa, FL 33607 n/i numeric investors Charles Schwab & Co. Inc. 22.9% Growth and Value Special Custody Account for the Fund (Class HH) Exclusive Benefit of Customers Attn: Mutual Funds 101 Montgomery Street San Francisco, CA 94104
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PERCENT PORTFOLIO NAME AND ADDRESS OWNED - --------- ---------------- -------- Chase Manhattan Bank 6.0% Collins Group Trust I 840 Newport Center Dr. Newport Beach, CA 92660 Boston Partners Large Dr. Janice B. Yost 26.2% Cap Value Fund - Trust Mary Black Foundation Inc. Institutional Class Bell Hill-945 E. Main St. (Class QQ) Spartanburg, SC 29302 Saxon and Co. 12.4% FBO UJF Equity Funds P.O. Box 7780-1888 Philadelphia, PA 19182 Irving Fireman's Relief & Ret 8.1% Fund Lou Mayfield-Chairman 601 N. Beltline Ste. 20 Irving, TX 75061 John N. Brodson and 10.0% Paul A. Ebert Trst Amer Coll of Surg Staf Mem Ret Plan 55 E. Erie Street Chicago, IL 60611 Wells Fargo Bank 15.7% Trst Stoel Rives Tr 008125 P. O. Box 9800 Calabasas, CA 91308 Hawaiian Trust Company LTD 6.3% Trst The Estate of James Campbell Pension Fund P.O. Box 3170 Honolulu, HI 96802-3170 Shady Side Academy Endowment 11.0% 423 Fox Chapel Rd. Pittsburgh, PA 15238
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PERCENT PORTFOLIO NAME AND ADDRESS OWNED - --------- ---------------- -------- Boston Partners Large Fleet National Bank TTEE 7.7% Cap Value Fund - Testa Hurwitz THIB Investor Class FBO Scott Birnbaum (Class RR) P.O. Box 92800 Rochester, NY 14692 National Financial Services 25.5% Corp For the Exclusive Benefit of our Customers Attn: Mutual Funds, 5th Floor 200 Liberty Street I World Financial Center New York, NY 10281 Joseph P. Scherer 10.3% Rollover IRA 26 Embassy Ct Cherry Hill, NJ 08002 Linda C. Brodson 7.3% Trst Linda C. Brodson Trust 465 Lakeside Pl Highland Park, IL 60035 John N. Brodson 7.3% Trust John N. Brodson Trust U/A DTD 08/06/87 465 Lakeside Pl Highland Park, IL 60035 Charles Schwab & Co. Inc. 12.0% Spjecial Custody Account for Bene of Cust Attn: Mutual Funds 101 Montgomery Street San Francisco, CA 94104 Mark R. Scott 6.1% and Maryann Scott JTTEN WROS 2543 Longmount Dr. Wexford, PA 15090
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PERCENT PORTFOLIO NAME AND ADDRESS OWNED - --------- ---------------- -------- Boston Partners Mid National Financial SVCS Corp. 27.2% Cap Value Fund For Exclusive Bene of our Investor Class Customers (Class TT) Sal Vella 200 Liberty Street New York, NY 10281 Charles Schwab & Co. Inc. 32.0% Special Custody Account for Bene of Cust Attn: Mutual Funds 101 Montgomery St. San Francisco, CA 94104 George B. Smithy, Jr. 13.0% 38 Greenwood Road Wellesley, MA 02181 John N. Brodson 6.4% Trst John N. Brodson Trust U/A DTD 08/06/87 465 Lakeside Pl Highland Park, IL 60035 Linda C. Brodson 6.4% Trst Linda C. Brodson Trust 465 Lakeside Pl Highland Park, IL 60035 Boston Partners Mid Wells Fargo Bank Cust 5.4% Cap Value Fund FBO William W. Carter Institutional Class IRA FIP 007430 (Class UU) P.O. Box 1389 San Carlos, CA 94070-1389 USNB of Oregon 77.2% Cust Jean Vollum Attn: Mutual Funds P.O. Box 3168 Portland, OR 97208
As of the same date, directors and officers as a group owned less than one percent of the shares of the Fund. 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 -54- 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. PIMC, PNC Bank and other institutions that are banks or bank affiliates are subject to such banking laws and regulations. PIMC and PNC Bank believe they may perform the services for the Fund contemplated by their respective agreements with the Fund without violation of applicable banking laws or regulations. It should be noted, however, that there have been no cases deciding whether bank 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 the Fund. If such were to occur, it is expected that the Board of Directors would recommend that the Fund enter into new agreements or would consider the possible termination of the Fund. Any new advisory or sub-advisory agreement would normally be subject to shareholder approval. It is not anticipated that any change in the Fund'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. Shareholder Approvals. As used in this Statement of Additional Information and in the Prospectuses, "shareholder approval" and a "majority of the outstanding shares" of a class, series or Portfolio 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 Portfolio represented at a meeting at which the holders of more than 50% of the outstanding shares of such class, series or Portfolio are present in person or by proxy, or (2) more than 50% of the outstanding shares of such class, series or Portfolio. FINANCIAL STATEMENTS The audited financial statements and notes thereto in the Funds' Annual Report to Shareholders (the "1997 Annual Report") for the fiscal year ended August 31, 1997 (the "Financial Statements") are incorporated by reference into this Statement of -55- Additional Information. No other parts of the 1997 Annual Report are incorporated by reference herein. The financial statements included in the 1997 Annual Report have been audited by RBB's independent accountants, Coopers & Lybrand, L.L.P. The reports of Coopers & Lybrand, L.L.P. are incorporated herein by reference, 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 1997 Annual Report may be obtained free of charge by telephoning PFPC at (800) 348-5031. No financial statements are supplied for the Larger Cap Value Fund because, as of the date of the Prospectus and this Statement of Additional Information, the Fund had no operating history. -56- APPENDIX A ---------- Commercial Paper Ratings - ------------------------ A Standard & Poor's ("S&P") commercial paper rating is a current assessment of the likelihood of timely payment of debt having an original maturity of no more than 365 days. The following summarizes the rating categories used by Standard and Poor's for commercial paper: "A-1" - The highest category indicates that the degree of safety regarding timely payment is strong. Those issues determined to possess extremely strong safety characteristics are denoted with a plus sign (+) designation. "A-2" - Capacity for timely payment on issues with this designation is satisfactory. However, the relative degree of safety is not as high as for issues designated "A-1." "A-3" - Issues carrying this designation have adequate capacity for timely payment. They are, however, more vulnerable to the adverse effects of changes in circumstances than obligations carrying the higher designations. "B" - Issues are regarded as having only a speculative capacity for timely payment. "C" - This rating is assigned to short-term debt obligations with a doubtful capacity for payment. "D" - Issues are in payment default. The "D" rating category is used when interest payments of principal payments are not made on the date due, even if the applicable grace period has not expired, unless S&P believes such payments will be made during such grace period. 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: "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 A-1 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 effects 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. Corporate Long-Term Debt Ratings - -------------------------------- The following summarizes the ratings used by Standard & Poor's for corporate debt: "AAA" - This designation represents 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. "BB," "B," "CCC," "CC" and "C" - Debt is regarded as having significant speculative characteristics. "BB" indicates A-2 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" - Debt is less vulnerable to non-payment 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" - Debt is more vulnerable to non-payment 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. "CCC" - Debt is currently vulnerable to non-payment, 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 non- payment. "C" - The "C" rating may be used to cover a situation where a bankruptcy petition has been filed or similar action has been taken, but payments on this obligation are being continued. "D" - An obligation rated "D" is in payment default. This rating is used when payments on an obligation are not made on the date due, even if the applicable grace period has not expired, unless S & P believes that such payments will be made during such grace period. "D" rating is also used upon the filing of a bankruptcy petition or the taking of similar action if payments on an obligation are jeopardized. PLUS (+) OR MINUS (-) - The ratings from "AA" through "CCC" may be modified by the addition of a plus or minus sign to show relative standing within the major rating categories. "r" - This rating is attached to highlight derivative, hybrid, and certain other obligations that S & P believes may experience high volatility or high variability in expected returns due to non-credit risks. Examples of such obligations are: securities whose principal or interest return is 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 A-3 that an obligation will exhibit no volatility or variability in total return. The following summarizes the ratings used by Moody's for corporate 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 risks appear somewhat larger than in "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" are of poor standing; "Ca" represents obligations which are speculative in a high degree; and "C" represents the lowest rated class of bonds). "Caa," "Ca" and "C" bonds may be in default. Con. (---) - Bonds for which the security depends upon the completion of some act or the fulfillment of some condition are rated conditionally. These are bonds secured by (a) earnings of projects under construction, (b) earnings of projects A-4 unseasoned in operation 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. (P)... - When applied to forward delivery bonds, indicates that the rating is provisional pending delivery of the bonds. The rating may be revised prior to delivery if changes occur in the legal documents or the underlying credit quality of the bonds. Note: Those bonds in the Aa, A, Baa, Ba and B groups which Moody's believes possess the strongest investment attributes are designated by the symbols Aa1, A1, Baa1, Ba1 and B1. A-5 PART C OTHER INFORMATION Item 24. FINANCIAL STATEMENTS AND EXHIBITS (a) Financial Statements: (1) Included in Part A of the Registration Statement: Financial Highlights (audited) for the n/i Numeric Investors Micro Cap, Growth and Growth & Value Funds for the fiscal year ended August 31, 1997 and for the period from June 3, 1997 (commencement of operations) through August 31, 1996. (2) Incorporated by reference into Part B: Audited Financial Statements included in Registrant's Annual Report to Shareholders dated September 30, 1997 for the n/i Numeric Investors Micro Cap, Growth and Growth & Value Funds, which has been previously filed with the Commission.
(b) Exhibits: SEE NOTE # ---------- (1) (a) Articles of Incorporation of Registrant 1 (b) Articles Supplementary of Registrant. 1 (c) Articles of Amendment to Articles of Incorporation of Registrant. 2 (d) Articles Supplementary of Registrant. 2 (e) Articles Supplementary of Registrant. 5 (f) Articles Supplementary of Registrant. 6 (g) Articles Supplementary of Registrant. 9 (h) Articles Supplementary of Registrant. 10 (i) Articles Supplementary of Registrant. 14 (j) Articles Supplementary of Registrant. 14 (k) Articles Supplementary of Registrant. 19 (l) Articles Supplementary of Registrant. 19 (m) Articles Supplementary of Registrant. 19 (n) Articles Supplementary of Registrant. 19 (o) Articles Supplementary of Registrant. 20 (p) Articles Supplementary of Registrant. 23 (q) Articles Supplementary of Registrant. 25 (r) Articles Supplementary of Registrant. 27 (s) Articles of Amendment to Charter of the Registrant. 28 (t) Articles Supplementary of Registrant. 28
(b) Exhibits: SEE NOTE # ---------- (2) By-Laws, as amended 28 (3) None. (4) (a) See Articles VI, VII, VIII, IX and XI of Registrant's 1 Articles of Incorporation dated February 17, 1988. (b) See Articles II, III, VI, XIII, and XIV of Registrant's 23 By-Laws as amended through April 26, 1996. (5) (a) Investment Advisory Agreement (Money Market) between Registrant 3 and Provident Institutional Management Corporation, dated as of August 16, 1988. (b) Sub-Advisory Agreement (Money Market) between Provident 3 Institutional Management Corporation and Provident National Bank, dated as of August 16, 1988. (c) Investment Advisory Agreement (Tax-Free Money Market) between 3 Registrant and Provident Institutional Management Corporation, dated as of August 16, 1988. (d) Sub-Advisory Agreement (Tax-Free Money Market) between Provident 3 Institutional Management Corporation and Provident National Bank, dated as of August 16, 1988. (e) Investment Advisory Agreement (Government Obligations Money 3 Market) between Registrant and Provident Institutional Management Corporation, dated as of August 16, 1988. (f) Sub-Advisory Agreement (Government Obligations Money Market) 3 between Provident Institutional Management Corporation and Provident National Bank, dated as of August 16, 1988. (g) Investment Advisory Agreement (Government Securities) between 8 Registrant and Provident Institutional Management Corporation dated as of April 8, 1991. (h) Investment Advisory Agreement (New York Municipal Money Market) 9 between Registrant and Provident Institutional Management Corporation dated November 5, 1991. (i) Investment Advisory Agreement (Tax-Free Money Market) between 10 Registrant and Provident Institutional Management Corporation dated April 21, 1992. (j) Investment Advisory Agreement (BEA International Equity 11 Portfolio) between Registrant and BEA Associates.
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(b) Exhibits: SEE NOTE # ---------- (k) Investment Advisory Agreement (BEA Strategic 11 Fixed Income Portfolio) between Registrant and BEA Associates. (l) Investment Advisory Agreement (BEA Emerging 11 Markets Equity Portfolio) between Registrant and BEA Associates. (m) Investment Advisory Agreement (BEA U.S. Core 15 Equity Portfolio) between Registrant and BEA Associates, dated as of October 27, 1993. (n) Investment Advisory Agreement (BEA U.S. Core 15 Fixed Income Portfolio) between Registrant and BEA Associates, dated as of October 27, 1993. (o) Investment Advisory Agreement (BEA Global 15 Fixed Income Portfolio) between Registrant and BEA Associates, dated as of October 27, 1993. (p) Investment Advisory Agreement (BEA Municipal 15 Bond Fund Portfolio) between Registrant and BEA Associates, dated as of October 27, 1993. (q) Investment Advisory Agreement (BEA Balanced) 16 between Registrant and BEA Associates. (r) Investment Advisory Agreement (BEA Short 16 Duration Portfolio) between Registrant and BEA Associates. (s) Investment Advisory Agreement (n/i Numeric 23 Investors Micro Cap Fund) between Registrant and Numeric Investors, L.P. (t) Investment Advisory Agreement (n/i Numeric 23 Investors Growth Fund) between Registrant and Numeric Investors, L.P. (u) Investment Advisory Agreement (n/i Numeric 23 Investors Growth & Value Fund) between Registrant and Numeric Investors, L.P. (v) Investment Advisory Agreement (BEA Global 24 Telecommunications Portfolio) between Registrant and BEA Associates. (w) Investment Advisory Agreement (Boston 26 Partners Large Cap Value Fund) between Registrant and Boston Partners Asset Management, L.P. (x) Investment Advisory Agreement (Boston 28 Partners Mid Cap Value Fund) between Registrant and Boston Partners Asset Management, L.P. (y) Investment Advisory Agreement (n/i Numeric Investors Larger Cap Value Fund) between Registrant and Numeric Investors, L.P. dated December 1, 1997.
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(b) Exhibits: SEE NOTE # ---------- (z) Investment Advisory Agreement (Boston Partners Bond Fund) between Registrant and Boston Partners Asset Management, L.P. dated December 1, 1997. (6) (r) Distribution Agreement and Supplements 8 (Classes A through Q) between the Registrant and Counsellors Securities Inc. dated as of April 10, 1991. (s) Distribution Agreement Supplement (Classes 9 L, M, N and 0) between the Registrant and Counsellors Securities Inc. dated as of November 5, 1991. (t) Distribution Agreement Supplements (Classes 9 R, S, and Alpha 1 through Theta 4) between the Registrant and Counsellors Securities Inc. dated as of November 5, 1991. (u) Distribution Agreement Supplement (Classes 10 T, U and V) between the Registrant and Counsellors Securities Inc. dated as of September 18, 1992. (w) Distribution Agreement Supplement (Classes X, 14 Y, Z and AA) between the Registrant and Counselors Securities Inc. (x) Distribution Agreement Supplement (Classes 18 BB and CC) between Registrant and Counsellors Securities Inc. dated as of October 26, 1994. (z) Distribution Agreement Supplement (Classes L, 19 M, N and O) between the Registrant and Counsellors Securities Inc. (aa) Distribution Agreement Supplement (Classes 19 R, S) between the Registrant and Counsellors Securities Inc. (bb) Distribution Agreement Supplements (Classes 19 Alpha 1 through Theta 4) between the Registrant and Counsellors Securities Inc. (cc) Distribution Agreement Supplement (Janney 20 Classes) between the Registrant and Counsellors Securities Inc. (dd) Distribution Agreement Supplement ni Classes 23 (Classes FF, GG and HH) between Registrant and Counsellors Securities Inc. (ee) Distribution Agreement Supplement (Classes 24 II, JJ, KK, and LL) between Registrant and Counsellors Securities Inc. (ff) Distribution Agreement Supplement (Classes 24 MM, NN, OO, and PP) between Registrant and Counsellors Securities Inc.
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(b) Exhibits: SEE NOTE # ---------- (gg) Distribution Agreement Supplement (Class QQ) 26 between Registrant and Counsellors Securities Inc. (hh) Distribution Agreement Supplement (Class RR) 27 between Registrant and Counsellors Securities Inc. (ii) Distribution Agreement Supplement (Class SS) 27 between Registrant and Counsellors Securities Inc. (jj) Distribution Agreement Supplement (Class TT) 28 between Registrant and Counsellors Securities Inc. (kk) Distribution Agreement Supplement (Class UU) 28 between Registrant and Counsellors Securities Inc. (ll) Distribution Agreement Supplement (Class VV) between Registrant and Counsellors Securities, Inc. (mm) Distribution Agreement Supplement (Class WW) between Registrant and Counsellors Securities, Inc. (nn) Distribution Agreement Supplement (Class XX) between Registrant and Counsellors Securities, Inc. (7) Fund Office Retirement Profit-Sharing and Trust 29 Agreement, dated as of October 24, 1990, as amended. (8) (a) Custodian Agreement between Registrant and 3 Provident National Bank dated as of August 16, 1988. (b) Sub-Custodian Agreement among The Chase 10 Manhattan Bank, N.A., the Registrant and Provident National Bank, dated as of July 13, 1992, relating to custody of Registrant's foreign securities. (e) Amendment No. 1 to Custodian Agreement dated 9 August 16, 1988. (f) Agreement between Brown Brothers Harriman & 10 Co. and Registrant on behalf of BEA International Equity Portfolio, dated September 18, 1992. (g) Agreement between Brown Brothers Harriman & 10 Co. and Registrant on behalf of BEA Strategic Fixed Income Portfolio, dated September 18, 1992. (h) Agreement between Brown Brothers Harriman & 10 Co. and Registrant on behalf of BEA Emerging Markets Equity Portfolio, dated September 18, 1992.
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(b) Exhibits: SEE NOTE # ---------- (i) Agreement between Brown Brothers Harriman & 15 Co. and Registrant on behalf of BEA Emerging Markets Equity, BEA International Equity, BEA Strategic Fixed Income and BEA Global Fixed Income Portfolios, dated as of November 29, 1993. (j) Agreement between Brown Brothers Harriman & 15 Co. and Registrant on behalf of BEA U.S. Core Equity and BEA U.S. Core Fixed Income Portfolios dated as of November 29, 1993. (k) Custodian Contract between Registrant and 18 State Street Bank and Trust Company. (l) Custody Agreement between Registrant and 23 Custodial Trust Company on behalf of n/i Numeric Investors Micro Cap Fund, n/i Numeric Investors Growth Fund and n/i Numeric Investors Growth & Value Fund Portfolios of the Registrant. (m) Custodian Agreement Supplement Between 26 Registrant and PNC Bank, National Association dated October 16, 1996. (n) Custodian Agreement Supplement between 27 Registrant and Brown Brothers Harriman & Co. on behalf of the BEA Municipal Bond Fund. (o) Custodian Agreement Supplement between 28 Registrant and PNC Bank, National Association, on behalf of the Boston Partners Mid Cap Value Fund. (p) Custody Agreement between Registrant and Custodial Trust Company on behalf of the n/i Numeric Investors Larger Cap Value Fund. (q) Custodian Agreement Supplement between Registrant and PNC Bank, N.A. on behalf of the Boston Partners Bond Fund. (9) (a) Transfer Agency Agreement (Sansom Street) 3 between Registrant and Provident Financial Processing Corporation, dated as of August 16, 1988. (b) Transfer Agency Agreement (Cash Preservation) 3 between Registrant and Provident Financial Processing Corporation, dated as of August 16, 1988. (c) Shareholder Servicing Agreement (Sansom 3 Street Money Market). (d) Shareholder Servicing Agreement (Sansom 3 Street Tax-Free Money Market). (e) Shareholder Servicing Agreement (Sansom 3 Street Government Obligations Money Market).
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(b) Exhibits: SEE NOTE # ---------- (f) Shareholder Services Plan (Sansom Street 3 Money Market). (g) Shareholder Services Plan (Sansom Street Tax- 3 Free Money Market). (h) Shareholder Services Plan (Sansom Street 3 Government Obligations Money Market). (i) Transfer Agency Agreement (Bedford) between 3 Registrant and Provident Financial Processing Corporation, dated as of August 16, 1988. (j) Administration and Accounting Services 8 Agreement between Registrant and Provident Financial Processing Corporation, relating to Government Securities Portfolio, dated as of April 10, 1991. (k) Administration and Accounting Services 9 Agreement between Registrant and Provident Financial Processing Corporation, relating to New York Municipal Money Market Portfolio dated as of November 5, 1991. (l) Administration and Accounting Services 10 Agreement between Registrant and Provident Financial Processing Corporation (BEA International Equity) dated September 18, 1992. (m) Administration and Accounting Services 10 Agreement between Registrant and Provident Financial Processing Corporation (BEA Strategic Fixed Income) dated September 18, 1992. (n) Administration and Accounting Services 10 Agreement between Registrant and Provident Financial Processing Corporation (BEA Emerging Markets Equity) dated September 18, 1992. (o) Transfer Agency Agreement and Supplements 9 (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. (p) Transfer Agency Agreement Supplement (BEA) 10 between Registrant and Provident Financial Processing Corporation dated as of September 19, 1992. (q) Administrative Services Agreement between 10 Registrant and Counsellor's Fund Services, Inc. (BEA Portfolios) dated September 18, 1992.
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(b) Exhibits: SEE NOTE # ---------- (r) Administration and Accounting Services 10 Agreement between Registrant and Provident Financial Processing Corporation, relating to Tax-Free Money Market Portfolio, dated as of April 21, 1992. (s) Transfer Agency Agreement Supplement (BEA 15 U.S. Core Equity, BEA U.S. Core Fixed Income, BEA Global Fixed Income and BEA Municipal Bond Fund Portfolios) between Registrant and PFPC Inc. dated as October 27, 1993. (t) Administration and Accounting Services Agreement 15 between Registrant and PFPC Inc. relating to BEA U.S. Core Equity Portfolio dated as of October 27, 1993. (u) Administration and Accounting Services Agreement 15 between Registrant and PFPC Inc. (BEA U.S. Core Fixed Income Portfolio) dated October 27, 1993. (v) Administration and Accounting Services 15 Agreement between Registrant and PFPC Inc. (International Fixed Income Portfolio) dated October 27, 1993. (w) Administration and Accounting Services 15 Agreement between Registrant and PFPC Inc. (Municipal Bond Fund Portfolio) dated October 27, 1993. (x) Transfer Agency Agreement Supplement (BEA 18 Balanced and Short Duration Portfolios) between Registrant and PFPC Inc. dated October 26, 1994. (y) Administration and Accounting Services Agreement 18 between Registrant and PFPC Inc. (BEA Balanced Portfolio) dated October 26, 1994. (z) Administration and Accounting Services 18 Agreement between Registrant and PFPC Inc. (BEA Short Duration Portfolio) dated October 26, 1994. (aa) Administrative Services Agreement Supplement 18 between Registrant and Counsellors Fund Services, Inc. (BEA Classes) dated October 26, 1994. (bb) Transfer Agency and Service Agreement between 21 Registrant and State Street Bank and Trust Company and PFPC, Inc. dated February 1, 1995. (cc) Supplement to Transfer Agency and Service 21 Agreement between Registrant, State Street Bank and Trust Company, Inc. and PFPC dated April 10, 1995.
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(b) Exhibits: SEE NOTE # ---------- (dd) Amended and Restated Credit Agreement dated 22 December 15, 1994. (ee) Transfer Agency Agreement Supplement (n/i 23 Numeric Investors Micro Cap Fund, n/i Numeric Investors Growth Fund and n/i Numeric Investors Growth & Value Fund) between Registrant and PFPC, Inc. dated April 14, 1996. (ff) Administration and Accounting Services 23 Agreement between Registrant and PFPC, Inc. (n/i Numeric Investors Micro Cap Fund) dated April 24, 1996. (gg) Administration and Accounting Services 23 Agreement between Registrant and PFPC, Inc. (n/i Numeric Investors Growth Fund) dated April 24, 1996. (hh) Administration and Accounting Services 23 Agreement between Registrant and PFPC, Inc. (n/i Numeric Investors Growth & Value Fund) dated April 24, 1996. (ii) Administrative Services Agreement between 23 Registrant and Counsellors Fund Services, Inc. (n/i Numeric Investors Micro Cap Fund, n/i Numeric Investors Growth Fund and n/i Numeric Investors Growth & Value Fund) dated April 24, 1996. (jj) Administration and Accounting Services 24 Agreement between Registrant and PFPC, Inc. (BEA Global Telecommunications Portfolio). (kk) Co-Administration Agreement between 24 Registrant Investor and BEA Associates (BEA International Equity Investor Portfolio). (ll) Co-Administration Agreement between 24 Registrant and BEA Associates (BEA International Equity Advisor Portfolio). (mm) Co-Administration Agreement between 24 Registrant and BEA Associates (BEA Emerging Markets Equity Investor Portfolio). (nn) Co-Administration Agreement between 24 Registrant and BEA Associates (BEA Emerging Markets Equity Advisor Portfolio). (oo) Co-Administration Agreement between 24 Registrant and BEA Associates (BEA High Yield Investor Portfolio). (pp) Co-Administration Agreement between 24 Registrant and BEA Associates (BEA High Yield Advisor Portfolio). (qq) Co-Administration Agreement between 24 Registrant and BEA Associates (BEA Global Telecommunications Investor Portfolio). (rr) Co-Administration Agreement between 24 Registrant and BEA Associates (BEA Global Telecommunications Advisor Portfolio).
-9-
(b) Exhibits: SEE NOTE # ---------- (ss) Transfer Agreement and Service Agreement 24 between Registrant and State Street Bank and Trust Company. (tt) Administration and Accounting Services 27 Agreement between the Registrant and PFPC Inc. dated October 16, 1996 (Boston Partners Large Cap Value Fund). (uu) Transfer Agency Agreement Supplement between 26 Registrant and PFPC Inc. (Boston Partners Large Cap Value Fund, Institutional Class). (vv) Transfer Agency Agreement Supplement between 26 Registrant and PFPC Inc. (Boston Partners Large Cap Value Fund, Investor Class). (ww) Transfer Agency Agreement Supplement between 26 Registrant and PFPC Inc. (Boston Partners Large Cap Value Fund, Advisor Class). (xx) Transfer Agency Agreement Supplement between 28 Registrant and PFPC Inc., (Boston Partners Mid Cap Value Fund, Institutional Class). (yy) Transfer Agency Agreement Supplement between 28 Registrant and PFPC Inc., (Boston Partners Mid Cap Value Fund, Investor Class). (zz) Administration and Accounting Services 28 Agreement between Registrant and PFPC Inc. dated, May 30, 1997 (Boston Partners Mid Cap Value Fund). (aaa) Transfer Agency Agreement Supplement (n/i Numeric Investors Larger Cap Value Fund) between Registrant and PFPC, Inc. dated December 1, 1997. (bbb) Administration and Accounting Services Agreement between Registrant and PFPC, Inc. dated December 1, 1997 (n/i Numeric Investors Larger Cap Value Fund). (ccc) Co-Administration Agreement between Registrant and Bear Stearns Funds Management, Inc. dated December 1, 1997 (n/i Numeric Investors Larger Cap Value Fund). (ddd) Administrative Services Agreement between Registrant and Counsellors Fund Services, Inc. dated December 1, 1997 (n/i Numeric Investors Larger Cap Value Fund) (eee) Transfer Agency Agreement Supplement between Registrant and PFPC, Inc. dated December 1, 1997 (Boston Partners Bond Fund, Institutional Class). (fff) Transfer Agency Agreement Supplement between Registrant and PFPC, Inc. dated December 1, 1997 (Boston Partners Bond Fund, Investor Class).
-10-
(b) Exhibits: SEE NOTE # ---------- (ggg) Administration and Accounting Services Agreement between Registrant and PFPC, Inc. dated December 1, 1997 (Boston Partners Bond Fund). (11) (a) Consent of Counsel. (b) Consent of Independent Accountants. (12) None. (13) (a) Subscription Agreement (relating to Classes A 2 through N). (b) Subscription Agreement between Registrant and 7 Planco Financial Services, Inc., relating to Classes O and P. (c) Subscription Agreement between Registrant 7 and Planco Financial Services, Inc., relating to Class Q. (d) Subscription Agreement between Registrant and 9 Counsellors Securities Inc. relating to Classes R, S, and Alpha 1 through Theta 4. (e) Subscription Agreement between Registrant 10 and Counsellors Securities Inc. relating to Classes T, U and V. (f) Subscription Agreement between Registrant and 18 Counsellor's Securities Inc. relating to Classes BB and CC. (g) Purchase Agreement between Registrant and 23 Numeric Investors, L.P. relating to Class FF (n/i Numeric Investors Micro Cap Fund). (h) Purchase Agreement between Registrant and 23 Numeric Investors, L.P. relating to Class GG (n/i Numeric Investors Growth Fund). (i) Purchase Agreement between Registrant and 23 Numeric Investors, L.P. relating to Class HH (n/i Numeric Investors Growth & Value Fund). (j) Subscription Agreement between Registrant 24 and Counsellors Securities, Inc. relating to Classes II through PP. (k) Purchase Agreement between Registrant and 27 Boston Partners Asset Management, L.P. relating to Classes QQ, RR and SS (Boston Partners Large Cap Value Fund). (l) Purchase Agreement between Registrant and 28 Boston Partners Asset Management, L.P. relating to Classes TT and UU (Boston Partners Mid Cap Value Fund).
-11-
(b) Exhibits: SEE NOTE # ---------- (m) Purchase Agreement between Registrant and Boston Partners Asset Management L.P.relating to Classes VV and WW (Boston Partners Bond Fund). (n) Purchase Agreement between Registrant and Numeric Investors, L.P. relating to Class XX (n/i Numeric Investors Larger Cap Value Fund). (14) None. (15) (a) Plan of Distribution (Sansom Street Money 3 Market). (b) Plan of Distribution (Sansom Street Tax-Free 3 Money Market). (c) Plan of Distribution (Sansom Street 3 Government Obligations Money Market). (d) Plan of Distribution (Cash Preservation 3 Money). (e) Plan of Distribution (Cash Preservation Tax- 3 Free Money Market). (f) Plan of Distribution (Bedford Money Market). 3 (g) Plan of Distribution (Bedford Tax-Free Money 3 Market). (h) Plan of Distribution (Bedford Government 3 Obligations Money Market). (i) Plan of Distribution (Income Opportunities 7 High Yield). (j) Amendment No. 1 to Plans of Distribution 8 (Classes A through Q). (k) Plan of Distribution (Alpha (now known as 9 Janney) Money Market). (l) Plan of Distribution (Alpha (now known as 9 Janney) 9 Tax-Free Money Market (now known as the Municipal Money Market)). (m) Plan of Distribution (Alpha (now known as 9 Janney) Government Obligations Money Market). (n) Plan of Distribution (Alpha (now known as 9 Janney) New York Municipal Money Market). (o) Plan of Distribution (Beta Money Market). 9 (p) Plan of Distribution (Beta Tax-Free Money 9 Market). (q) Plan of Distribution (Beta Government 9 Obligations Money Market). (r) Plan of Distribution (Beta New York Money 9 Market). (s) Plan of Distribution (Gamma Money Market). 9
-12-
(b) Exhibits: SEE NOTE # ---------- (t) Plan of Distribution (Gamma Tax-Free Money 9 Market). (u) Plan of Distribution (Gamma Government 9 Obligations Money Market). (v) Plan of Distribution (Gamma New York 9 Municipal Money Market). (w) Plan of Distribution (Delta Money Market). 9 (x) Plan of Distribution (Delta Tax-Free Money 9 Market). (y) Plan of Distribution (Delta Government 9 Obligations Money Market). (z) Plan of Distribution (Delta New York 9 Municipal Money Market). (aa) Plan of Distribution (Epsilon Money Market). 9 (bb) Plan of Distribution (Epsilon Tax-Free Money 9 Market). (cc) Plan of Distribution (Epsilon Government 9 Municipal Money Market). (dd) Plan of Distribution (Epsilon New York 9 Municipal Money Market). (ee) Plan of Distribution (Zeta Money Market). 9 (ff) Plan of Distribution (Zeta Tax-Free Money 9 Market). (gg) Plan of Distribution (Zeta Government 9 Obligations Money Market). (hh) Plan of Distribution (Zeta New York Municipal 9 Money Market). (ii) Plan of Distribution (Eta Money Market). 9 (jj) Plan of Distribution (Eta Tax-Free Money 9 Market). (kk) Plan of Distribution (Eta Government 9 Obligations Money Market). (ll) Plan at Distribution (Eta New York Municipal 9 Money Market). (mm) Plan of Distribution (Theta Money Market). 9 (nn) Plan of Distribution (Theta Tax-Free Money 9 Market). (oo) Plan of Distribution (Theta Government 9 Obligations Money Market). (pp) Plan of Distribution (Theta New York 9 Municipal Money Market).
-13-
(b) Exhibits: SEE NOTE # ---------- (qq) Plan of Distribution (BEA International 24 Equity Investor). (rr) Plan of Distribution (BEA International 24 Equity Advisor). (ss) Plan of Distribution (BEA Emerging Markets 24 Equity Investor). (tt) Plan of Distribution (BEA Emerging Markets 24 Equity Advisor). (uu) Plan of Distribution (BEA High Yield 24 Investor). (vv) Plan of Distribution (BEA High Yield 24 Advisor). (ww) Plan of Distribution (BEA Global 24 Telecommunications Investor). (xx) Plan of Distribution (BEA Global 24 Telecommunications Advisor). (yy) Plan of Distribution (Boston Partners Large 26 Cap Value Fund Institutional Class) (zz) Plan of Distribution (Boston Partners Large 27 Cap Value Fund Investor Class) (aaa) Plan of Distribution (Boston Partners Large 27 Cap Value Fund Advisor Class) (bbb) Plan of Distribution (Boston Partners Mid Cap 27 Value Fund Investor Class) (ccc) Plan of Distribution (Boston Partners 27 Mid Cap Value Fund Institutional Class) (ddd) Plan of Distribution (Boston Partners Bond Fund Institutional Class). (eee) Plan of Distribution (Boston Partners Bond Fund Investor Class). (16) (a) Schedule for Computation of Performance 29 Quotations for the Money Market and Boston Partners Portfolios. (b) Schedule for Computation of Performance 30 Quotations for the BEA Portfolios. (c) Schedule for Computation of Performance Quotations for the n/i Numeric Investors Portfolios. (17) Financial Data Schedules for the n/i Numeric Investors Portfolios. (18) Amended 18f-3 Plan. 29
-14-
NOTE # 1 Incorporated herein by reference to the same exhibit number of Registrant's Registration Statement (No. 33-20827) filed on March 24, 1988. 2 Incorporated herein by reference to the same exhibit number of Pre- Effective Amendment No. 2 to Registrant's Registration Statement (No. 33-20827) filed on July 12, 1988. 3 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 1 to Registrant's Registration Statement (No. 33-20827) filed on March 23, 1989. 4 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 2 to Registrant's Registration Statement (No. 33-20827) filed on October 25, 1989. 5 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 3 to the Registrant's Registration Statement (No. 33-20827) filed on April 27, 1990. 6 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 4 to the Registrant's Registration Statement (No. 33-20827) filed on May 1, 1990. 7 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 5 to the Registrant's Registration Statement (No. 33-20827) filed on December 14, 1990. 8 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 6 to the Registrant's Registration Statement (No. 33-20827) filed on October 24, 1991. 9 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 7 to the Registrant's Registration Statement (No. 33-20827) filed on July 15, 1992. 10 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 8 to the Registrant's Registration Statement (No. 33-20827) filed on October 22, 1992. 11 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 9 to the Registrant's Registration Statement (No. 33-20827) filed on December 16, 1992. 12 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 11 to the Registrant's Registration Statement (No. 33-20827) filed on June 21, 1993. 13 Incorporated herein by reference to the same exhibit number Post- Effective Amendment No. 12 to the Registrant's Registration Statement (No. 33-20827) filed on July 27, 1993. 14 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 13 to the Registrant's Registration Statement (No. 33-20827) filed on October 29, 1993. 15 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 14 to the Registrant's Registration Statement (No. 33-20827) filed on December 21, 1993.
-15- 16 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 19 to the Registrant's Registration Statement (No. 33-20827) filed on October 14, 1994. 17 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 20 to the Registrant's Registration Statement (No. 33-20827) filed on October 21, 1994. 18 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 21 to the Registrant's Registration Statement (No. 33-20827) filed on October 28, 1994. 19 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 22 to the Registrant's Registration Statement (No. 33-20827) filed an December 19, 1994. 20 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 27 to the Registrant's Registration Statement (No. 33-20827) filed on March 31, 1995. 21 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 28 to the Registrant's Registration Statement (No. 33-20827) filed on October 6, 1995. 22 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 29 to the Registrant's Registration Statement (No. 33-20827) filed on October 25, 1995. 23 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 34 to the Registrant's Registration Statement (No. 33-20827) filed on May 16, 1996. 24 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 37 to the Registrant's Registration Statement (No. 33-20827) filed July 30, 1996. 25 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 39 to the Registrant's Registration Statement (No. 33-20827) filed on October 11, 1996. 26 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 41 to the Registrant's Registration Statement (No. 33-20827) filed on November 27, 1996. 27 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 45 to the Registrant's Registration Statement (No. 33-20827) filed on May 9, 1997. 28 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 46 to the Registrant's Registration Statement (33-20827) filed on September 25, 1997. 29 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 49 to the Registrant's Registration Statement (33-20827) filed on December 1, 1997. 30 Incorporated herein by reference to the same exhibit number of Post- Effective Amendment No. 50 to the Registrant's Registration Statement (33-20827) filed on December 1, 1997.
-16- Item 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT None. Item 26. NUMBER OF HOLDERS OF SECURITIES The following information is given as of November 15, 1997.
TITLE OF CLASS OF COMMON STOCK NUMBER OF RECORD HOLDERS - ------------------------------ ------------------------ a) Cash Preservation Money Market 42 b) Cash Preservation Municipal Money Market 59 c) Sansom Street Money Market 3 d) Sansom Street Municipal Money Market 0 e) Sansom Street Government Obligations Money Market 0 f) Bedford Money Market 143205 g) Bedford New York Municipal Money Market 3191 h) RBB Government Securities 530 i) Bedford Municipal Money Market 6713 j) Bedford Government Obligations Money Market 10999 k) BEA International Equity - Institutional Class 442 l) BEA International Equity - Investor Class 0 m) BEA International Equity - Advisor Class 11 n) BEA High Yield - Institutional Class 102 o) BEA High Yield - Investor Class 0 p) BEA High Yield - Advisor Class 10 q) BEA Emerging Markets Equity - Institutional Class 47 r) BEA Emerging Markets Equity - Investor Class 0 s) BEA Emerging Markets Equity - Advisor Class 10 t) BEA U.S. Core Equity 93 u) BEA U.S. Core Fixed Income 64 v) BEA Strategic Global Fixed Income 28 w) BEA Municipal Bond Fund 38 x) BEA Short Duration 0 y) BEA Balanced 0 z) BEA Global Telecommunications - Investor Class 0 aa) BEA Global Telecommunications - Advisor Class 21 bb) Janney Montgomery Scott Money Market 95911 cc) Janney Montgomery Scott Municipal Money Market 4319 dd) Janney Montgomery Scott Government Obligations Money Market 33839 ee) Janney Montgomery Scott New York Municipal Money Market 1407 ff) ni Numeric Investors Micro Cap 3628 gg) ni Numeric Investors Growth 3581 hh) ni Numeric Investors Growth & Value 3024 ii) Boston Partners Large Cap Value Fund - Institutional Class 28 jj) Boston Partners Large Cap Value Fund - Investor Class 32 kk) Boston Partners Large Cap Value Fund - Advisor Class 0 ll) Boston Partners Mid Cap Value Fund - Investor Class 19 mm) Boston Partners Mid Cap Value Fund - Institutional Class 26
Item 27. INDEMNIFICATION Sections 1, 2, 3 and 4 of Article VIII of Registrant's Articles of Incorporation, as amended, incorporated herein by reference as Exhibits 1(a) and 1(c), provide as follows: -17- 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. Item 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER Information as to any other business, profession, vocation or employment of substantial nature in which any directors and officers of PIMC, BEA, Numeric and Boston Partners are, or at any time during the past two (2) years have been, engaged for their own accounts or in the capacity of director, officer, employee, partner or trustee is incorporated herein by reference to Schedules A and D of PIMC's FORM ADV (File No. 801-13304) filed on March 28, 1997, Schedules B and D of BEA's FORM ADV (File No. 801-37170) filed on March 31, 1997, Schedules B and D of Numeric's FORM ADV (File No. 801-35649) filed on March 27, 1997, and Schedules of Boston Partners' FORM ADV (File No. 801- 49059) filed on July 17, 1997, respectively. -18- 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 PNB Bank, National Association (successor by merger to Provident National Bank) ("PNC Bank"), is, or at any time during the past two years has been, engaged for his own account or in the capacity of director, officer, employee, partner or trustee. PNC Bank, National Association Directors
Position with Type PNC Bank Name Other Business Connections of Business - -------- ---- -------------------------- ----------- Director B.R. Brown President and C.E.O. of Coal Consol, Inc. Consol Plaza Pittsburgh, PA 15241 Director Constance E. Clayton Associate Dean, School of Medical Health & Professor of Pediatrics Medical College of PA Hahnemann University 430 East Sedgwick St. Philadelphia, PA 19119 Director Eberhard Faber IV Chairman and C.E.O. Manufacturing E.F.L., Inc. 450 Hedge Road P.O. Box 49 Bearcreek, PA 18602 Director Dr. Stuart Heydt President and C.E.O. Medical Geisinger Foundation 100 N. Academy Avenue Danville, PA 17822 Director Edward P. Junker, III Vice Chairman Banking PNC Bank, N.A. Ninth and State Streets Erie, PA 16553 Director Thomas A. McConomy President, C.E.O. and Manufacturing Chairman, Calgon Carbon Corporation 413 Woodland Road Sewickley, PA 15143 Director Thomas H. O'Brien Chairman Banking PNC Bank, National Association One PNC Plaza, 30th Floor Pittsburgh, PA 15265 Director Dr. J. Dennis O'Connor Provost, The Smithsonian Education Institution 1000 Jefferson Drive, S.W. Room 230, MRC 009 Washington, DC 20560 Director Rocco A. Ortenzio Chairman and C.E.O. Medical Continental Medical Systems, Inc.
-19- P.O. Box 715 Mechanicsburg, PA 17055 Director Jane G. Pepper President Horticulture Pennsylvania Horticulture Society 325 Walnut Street Philadelphia, PA 19106 Director Robert C. Robb, Jr. President, Lewis, Eckert, Robb Financial & Company and 425 One Plymouth Meeting Management Plymouth Meeting, PA 19462 Consultants Director James E. Rohr President and C.E.O. Bank Holding PNC Bank, National Association Company One PNC Plaza, 30th Floor Pittsburgh, PA 15265 Director Daniel M. Rooney President, Pittsburgh Steelers Football Football Club of the National Football League 300 Stadium Circle Pittsburgh, PA 15212 Director Seth E. Schofield Chairman, President and C.E.O. Airline USAir Group, Inc. and USAir, Inc. 2345 Crystal Drive Arlington, VA 22227
PNC Bank, National Association Officers John E. Alden Senior Vice President James C. Altman Senior Vice President Lila M. Bachelier Senior Vice President R. Perrin Baker Chief Market Counsel, Northwest PA James R. Bartholomew Senior Vice President Peter R. Begg Senior Vice President Donald G. Berdine Senior Vice President Ben Berzin, Jr. Senior Vice President James H. Best Senior Vice President Eva T. Blum Senior Vice President Susan B. Bohn Senior Vice President George Brikis Executive Vice President Michael Brundage Senior Vice President
-20- PNC Bank, National Association Officers Anthony J. Cacciatore Senior Vice President Richard C. Caldwell Executive Vice President Craig T. Campbell Senior Vice President J. Richard Carnall Executive Vice President Edward V. Caruso Executive Vice President Peter K. Classen President & CEO, PNC Bank, Northeast, Pa James P. Conley Senior Vice President/Credit Policy Andra D. Cochran Senior Vice President Sharon Coghlan Coordinating Market Chief Counsel, Philadelphia James P. Conley Senior Vice President C. David Cook Senior Vice President Alfred F. Cordasco Supervising Counsel, Pittsburgh, PA Robert Crouse Senior Vice President Peter M. Crowley Senior Vice President Keith P. Crytzer Senior Vice President John J. Daggett Senior Vice President Peter J. Donchak Senior Vice President Anuj Dhanda Senior Vice President Victor M. DiBattista Chief Regional Counsel Frank H. Dilenschneider Senior Vice President Thomas C. Dilworth Senior Vice President Alfred J. DiMatteis Senior Vice President James Dionise Senior Vice President and C.F.O. Patrick S. Doran Vice President, Head of Consumer Lending Robert D. Edwards Senior Vice President David J. Egan Senior Vice President J. Lynn Evans Senior Vice President & Controller William E. Fallon Senior Vice President James M. Ferguson, III Senior Vice President
-21- PNC Bank, National Association Officers Charles J. Ferrero Senior Vice President Frederick C. Frank, III Executive Vice President William J. Friel Executive Vice President John F. Fulgoney Senior Counsel & Corporate Secretary Brian K. Garlock Senior Vice President George D. Gonczar Senior Vice President Richard C. Grace Senior Vice President James S. Graham Senior Vice President Michael J. Hannon Senior Vice President Stephen G. Hardy Senior Vice President Michael J. Harrington Senior Vice President Marva H. Harris Senior Vice President Maurice H. Hartigan, II Executive Vice President G. Thomas Hewes Senior Vice President Sylvan M. Holzer Senior Vice President Bruce C. Iacobucci Senior Vice President John M. Infield Senior Vice President Philip C. Jackson Senior Vice President William J. Johns Controller William R. Johnson Audit Director Edward P. Junker, III Vice Chairman Robert D. Kane Senior Vice President Michael D. Kelsey Chief Compliance Counsel Jack Kelly Senior Vice President Geoffrey R. Kimmel Senior Vice President Randall C. King Senior Vice President Christopher M. Knoll Senior Vice President Richard C. Krauss Senior Vice President
-22- PNC Bank, National Association Officers Frank R. Krepp Senior Vice President & Chief Credit Policy Officer Kenneth P. Leckey Senior Vice President & Cashier Marilyn R. Levins Senior Vice President Carl J. Lisman Executive Vice President George Lula Senior Vice President Jane E. Madio Senior Vice President Nicholas M. Marsini, Jr. Senior Vice President John A. Martin Senior Vice President David O. Matthews Senior Vice President Walter B. McClellan Senior Vice President James F. McGowan Senior Vice President Charlotte B. McLaughlin Senior Vice President James C. Mendelson Senior Vice President James W. Meighen Senior Vice President Scott C. Meves Senior Vice President Ralph S. Michael, III Executive Vice President J. William Mills Senior Vice President Barbara A. Misner Senior Vice President Marlene D. Mosco Senior Vice President Scott Moss Senior Vice President Peter F. Moylan Senior Vice President Michael B. Nelson Executive Vice President Thomas J. Nist Senior Vice President Thomas H. O'Brien Chairman James F. O'Day Senior Vice President Cynthia G. Osofsky Senior Vice President Thomas E. Paisley, III Senior Vice President Barbara Z. Parker Executive Vice President
-23- PNC Bank, National Association Officers George R. Partridge Senior Vice President Daniel J. Panlick Senior Vice President David M. Payne Senior Vice President Charles C. Pearson, Jr. President and CEO, PNC Bank, Central PA Helen P. Pudlin Senior Vice President Edward V. Randall, Jr. President and CEO, PNC Bank, Pittsburgh Arthur F. Rodman, III Senior Vice President Richard C. Rhoades Senior Vice President Bryan W. Ridley Senior Vice President James E. Rohr President and Chief Executive Officer Gary Royer Senior Vice President Robert T. Saltarelli Senior Vice President Robert V. Sammartino Senior Vice President William Sayre, Jr. Senior Vice President Alfred J. Schiavetti Senior Vice President David W. Schoffstall Executive Vice President Seymour Schwartzberg Senior Vice President Timothy G. Shack Senior Vice President Douglas E. Shaffer Senior Vice President Alfred A. Silva Senior Vice President George R. Simon Senior Vice President Richard L. Smoot President and CEO of PNC Bank, Philadelphia Timothy N. Smyth Senior Vice President Kenneth S. Spatz Senior Vice President Darcel H. Steber Senior Vice President Robert L. Tassome Senior Vice President Jane B. Tompkins Senior Vice President Robert B. Trempe Senior Vice President Kevin M. Tucker Senior Vice President
-24- PNC Bank, National Association Officers Alan P. Vail Senior Vice President Frank T. VanGrofski Executive Vice President Ronald H. Vicari Senior Vice President William A. Wagner Senior Vice President Patrick M. Wallace Senior Vice President Annette M. Ward-Kredel Senior Vice President Robert S. Wrath Senior Vice President Arlene M. Yocum Senior Vice President Carole Yon Senior Vice President George L. Ziminski, Jr. Senior Vice President
(1) PNC Bank, National Association, 120 S. 17th Street, Philadelphia, PA 19103 1600 Market Street, Philadelphia, PA 19103 17th and Chestnut Streets, Philadelphia, PA 19103 (2) PNC National Bank, 103 Bellevue Parkway, Wilmington, DE 19809. (3) PFPC Inc., 103 Bellevue Parkway, Wilmington, DE 19809. (4) PNC Service Corp, 103 Bellevue Parkway, Wilmington, DE 19809. (5) Provident Capital Management, Inc., 30 S. 17th Street, Suite 1500, Philadelphia, PA 19103. (6) PNC Investment Corp., Broad and Chestnut Street, Philadelphia, PA 19101. (7) Provident Realty Management, Inc., Broad and Chestnut StreetS, Philadelphia, PA 19101. (8) Provident Realty, Inc., Broad and Chestnut Streets, Philadelphia, PA 19101. (9) PNC Bancorp, Inc., 222 Delaware Avenue, Wilmington, DE 19810 (10) PNC New Jersey Credit Corp, 1415 Route 70 East, Suite 604, Cherry Hill, NJ 08034. (11) PNC Trust Company of New York, 40 Broad Street, New York, NY 10084. (12) Provcor Properties, Inc., Broad and Chestnut Streets, Philadelphia, PA 19101. (13) PNC Credit Corp, 103 Bellevue Parkway, Wilmington, DE 19809. (14) PNC Bank Corp., 5th Avenue and Wood Streets, Pittsburgh, PA 15265. (16) PNC Bank, New Jersey, National Association, Woodland Falls Corporate Park, 210 Lake Drive East, Cherry Hill, NJ 08002. -25- (17) PNC Capital Corp, 5th Avenue and Woods Streets, Pittsburgh, PA 15265. (18) PNC Holding Corp, 222 Delaware Avenue, P.O. Box 791, Wilmington, DE 19899. (19) PNC Venture Corp, 5th Avenue and Woods Streets, Pittsburgh, PA 15265. (20) PNC Bank, Delaware, 300 Delaware Avenue, Wilmington, DE 19801. (21) Bank of Delaware Corp., 300 Delaware Avenue, Wilmington, DE 19801. (22) Del-Vest, Inc., 300 Delaware Avenue, Wilmington, DE 19801. (23) Marand Corp., 222 Delaware Avenue, Wilmington, DE 19801. (24) Millsboro Insurance Agency, 300 Delaware Avenue, Wilmington, DE 19801. (25) Roney-Richards, Inc., 300 Delaware Avenue, Wilmington, DE 19801. Item 29. PRINCIPAL UNDERWRITER (a) Counsellors Securities Inc. (the "Distributor") acts as principal underwriter for the following investment companies: Warburg Pincus Cash Reserve Fund Warburg Pincus New York Tax Exempt Fund Warburg Pincus New York Intermediate Municipal Fund Warburg Pincus Intermediate Maturity Government Fund Warburg Pincus Fixed Income Fund Warburg Pincus Global Fixed Income Fund Warburg Pincus Capital Appreciation Fund Warburg Pincus Emerging Growth Fund Warburg Pincus International Equity Fund Warburg Pincus Japan OTC Fund Warburg Pincus Growth & Income Fund Warburg Pincus Balanced Fund Warburg Pincus Emerging Markets Fund Warburg Pincus Global Post-Venture Capital Fund Warburg Pincus Health Sciences Fund Warburg Pincus Institutional Fund Warburg Pincus Japan Growth Fund Warburg Pincus Post-Venture Capital Fund Warburg Pincus Small Company Growth Fund Warburg Pincus Small Company Value Fund Warburg Pincus Strategic Value Fund Warburg Pincus Trust Warburg Pincus Trust II (b) The information required by this item 29(b) is incorporated by reference to Form BD (SEC File No. 15-654) filed by the Distributor with the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934. Item 30. LOCATION OF ACCOUNTS AND RECORDS (1) PNC Bank, National Association (successor by merger to Provident National Bank), 1600 Market Street, Philadelphia, PA 19103 (records relating to its functions as sub-adviser and custodian). -26- (2) Counsellors Securities Inc., 466 Lexington Avenue, New York, New York 10017 (records relating to its functions as distributor). (3) PNC 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, Philadelphia National Bank Building, 1345 Chestnut Street, Philadelphia, Pennsylvania 19107-3496 (Registrant's Articles of Incorporation, By-Laws and Minute Books). (6) BEA Associates, One Citicorp Center, 153 East 53rd Street, New York, New York 10022 (records relating to its function as investment adviser). (7) Numeric Investors, L.P., 1 Memorial Drive, Cambridge, Massachusetts 02142 (records relating to its function as investment adviser). (8) Boston Partners Asset Management, L.P., One Financial Center, 43rd Floor, Boston, Massachusetts 02111 (records relating to its function as investment adviser). Item 31. MANAGEMENT SERVICES None. Item 32. UNDERTAKINGS (a) Registrant hereby undertakes to hold a meeting of shareholders for the purpose of considering the removal of directors in the event the requisite number of shareholders so request. -27- SIGNATURES Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets all of the requirements for effectiveness of this registration statement pursuant to Rule 485(b) under the Securities Act of 1933 and has duly caused this Post- Effective Amendment No. 51 to its Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Wilmington, and State of Delaware, on the 8th day of December, 1997. THE RBB FUND, INC. By: /s/ Edward J. Roach ---------------------------- Edward J. Roach President and Treasurer Pursuant to the requirements of the Securities Act of 1933, this Post- Effective Amendment to Registrant's Registration Statement has been signed below by the following persons in the capacities and on the date indicated.
SIGNATURE TITLE DATE --------- ----- ---- /s/Edward J. Roach President (Principal December 8, 1997 - ---------------------- Executive Officer) and Edward J. Roach Treasurer (Principal Financial and Accounting Officer) *Donald van Roden Director December 8, 1997 - ---------------------- Donald van Roden *Francis J. McKay Director December 8, 1997 - ---------------------- Francis J. McKay *Marvin E. Sternberg Director December 8, 1997 - ---------------------- Marvin E. Sternberg *Julian A. Brodsky Director December 8, 1997 - ---------------------- Julian A. Brodsky *Arnold M. Reichman Director December 8, 1997 - ---------------------- Arnold M. Reichman *Robert Sablowsky Director December 8, 1997 - ---------------------- Robert Sablowsky *By:/s/ Edward J. Roach December 8 , 1997 ------------------- Edward J. Roach Attorney-in-Fact
-28- 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 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 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 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 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 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 THE RBB FUND, INC. EXHIBIT INDEX ------------- Exhibits -------- (5)(y) Investment Advisory Agreement ( n/i Numeric Investors Larger Cap Value Fund) between Registrant and Numeric Investors, L.P. dated December 1, 1997. (5)(z) Investment Advisory Agreement (Boston Partners Bond Fund) between Registrant and Boston Partners Asset Management, L.P. dated December 1, 1997. (6)(ll) Distribution Agreement Supplement (Class VV) between Registrant and Counsellors Securities, Inc. (6)(mm) Distribution Agreement Supplement (Class WW) between Registrant and Counsellors Securities, Inc. (6)(nn) Distribution Agreement Supplement (Class XX) between Registrant and Counsellors Securities, Inc. (8)(p) Custody Agreement between Registrant and Custodial Trust Company on behalf of the n/i Numeric Investors Larger Cap Value Fund. (8)(q) Custodial Agreement Supplement between Registrant and PNC Bank, N.A. on behalf of the Boston Partners Bond Fund. (9)(aaa) Transfer Agency Agreement Supplement between Registrant and PFPC Inc. dated December 1, 1997 (n/i Numeric Investors Larger Cap Value Fund). (9)(bbb) Administration and Accounting Services Agreement between Registrant and PFPC Inc. dated December 1, 1997 (n/i Numeric Investors Larger Cap Value Fund). (9)(ccc) Co-Administration Agreement between Registrant and Bear Stearns Funds Management, Inc. dated December 1, 1997 (n/i Numeric Investors Larger Cap Value Fund). (9)(ddd) Administrative Services Agreement between Registrant and Counsellors Fund Services, Inc. dated December 1, 1997 (n/i Numeric Investors Larger Cap Value Fund). (9)(eee) Transfer Agency Agreement Supplement between Registrant and PFPC Inc. dated December 1, 1997 (Boston Partners Bond Fund, Institutional Class). (9)(fff) Transfer Agency Agreement Supplement between Registrant and PFPC Inc. dated December 1, 1997 (Boston Partners Bond Fund, Investor Class). (9)(ggg) Administration and Accounting Services Agreement between Registrant and PFPC, Inc. dated December 1, 1997 (Boston Partners Bond Fund). (13)(m) Purchase Agreement between Registrant and Boston Partners Asset Management L.P. relating to Classes VV and WW (Boston Partners Bond Fund). (13)(n) Purchase Agreement between Registrant and Numeric Investors, L.P. relating to Class XX (n/i Numeric Investors Larger Cap Value Fund). (15)(ddd) Plan of Distribution (Boston Partners Bond Fund Institutional Class). (15)(eee) Plan of Distribution (Boston Partners Bond Fund Investor Class). (11)(a) Consent of Drinker Biddle & Reath LLP. (11)(b) Consent of Independent Accountants. (16)(c) Schedule for Computation of Performance Quotations for the n/i Numeric Investors Portfolios. (17)(a) Financial Data Schedules with respect to the n/i Numeric Investors Micro Cap Class. (17)(b) Financial Data Schedules with respect to the n/i Numeric Investors Growth Class. (17)(c) Financial Data Schedules with respect to the n/i Numeric Investors Growth and Value Class.
EX-99.5Y 2 INVESTMENT ADVISORY AGREEMENT Exhibit (5)(y) INVESTMENT ADVISORY AGREEMENT ----------------------------- n/i Larger Cap Value Fund AGREEMENT made as of December 1, 1997 between THE RBB FUND, INC., a Maryland corporation (herein called the "Fund"), and Numeric Investors L.P. (herein called the "Investment Adviser"). WHEREAS, the Fund is registered as an open-end, management investment company under the Investment Company Act of 1940 (the "1940 Act") and currently offers or proposes to offer shares representing interests in twenty-two separate investment portfolios; and WHEREAS, the Fund desires to retain the Investment Adviser to render certain investment advisory services to the Fund with respect to the Fund's n/i Larger Cap Value Fund (the "Portfolio"), and the Investment Adviser is willing to so render such services. NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, and intending to be legally bound hereby, it is agreed between the parties hereto as follows: 1. Appointment. The Fund hereby appoints the Investment Adviser to ----------- act as investment adviser for the Portfolio for the period and on the terms set forth in this Agreement. The Investment Adviser accepts such appointment and agrees to render the services herein set forth, for the compensation herein provided. 2. Delivery of Documents. The Fund has furnished the Investment --------------------- Adviser with copies properly certified or authenticated of each of the following: (a) Resolutions of the Board of Directors of the Fund authorizing the appointment of the Investment Adviser and the execution and delivery of this Agreement; (b) Each prospectus and statement of additional information relating to any class of Shares representing interests in the Portfolio of the Fund in effect under the 1933 Act (such prospectus and statement of additional information, as presently in effect and as they shall from time to time be amended and supplemented, are herein collectively called the "Prospectus" and "Statement of Additional Information," respectively). The Fund will promptly furnish the Investment Adviser from time to time with copies, properly certified or authenticated, of all amendments of or supplements to the foregoing, if any. In addition to the foregoing, the Fund will also provide the Investment Adviser with copies of the Fund's Charter and By-laws, and any registration statement or service contracts related to the Portfolio, and will promptly furnish the Investment Adviser with any amendments of or supplements to such documents. 3. Management of the Portfolio. Subject to the supervision of the --------------------------- Board of Directors of the Fund, the Investment Adviser will provide for the overall management of the Portfolio including (i) the provision of a continuous investment program for the Portfolio, including investment research and management with respect to all securities, investments, cash and cash equivalents in the Portfolio, (ii) the determination from time to time of what securities and other investments will be purchased, retained, or sold by the Fund for the Portfolio, and (iii) the placement from time to time of orders for all purchases and sales made for the Portfolio. The Investment Adviser will provide the services rendered by it hereunder in accordance with the Portfolio's investment objectives, restrictions and policies as stated in the applicable Prospectus and the Statement of Additional Information, provided that the Investment Adviser has actual or constructive notice or knowledge of any changes by the Board of Directors to such investment objectives, restrictions or policies. The Investment Adviser further agrees that it will render to the Fund's Board of Directors such periodic and special reports regarding the performance of its duties under this Agreement as the Board may reasonably request. The Investment Adviser agrees to provide to the Fund (or its agents and service providers) prompt and accurate data with respect to the Portfolio's transactions and, where not otherwise available, the daily valuation of securities in the Portfolio. 4. Brokerage. The Investment Adviser shall have full discretion to --------- select brokers or dealers to effect the purchase and sale of securities. When the Investment Adviser places orders for the purchase or sale of securities for the Portfolio, in selecting brokers or dealers to execute such orders, the Investment Adviser is expressly authorized to consider the fact that a broker or dealer has furnished statistical, research or other information or services for the benefit of the Portfolio directly or indirectly. Without limiting the generality of the foregoing, the Investment Adviser is authorized to cause the Portfolio to pay brokerage commissions which may be in excess of the lowest rates available to brokers who execute transactions for the Portfolio or who otherwise provide brokerage and research services utilized by the Investment Adviser, provided that the -2- Investment Adviser determines in good faith that the amount of each such commission paid to a broker is reasonable in relation to the value of the brokerage and research services provided by such broker viewed in terms of either the particular transaction to which the commission relates or the Investment Adviser's overall responsibilities with respect to accounts as to which the Investment Adviser exercises investment discretion. The Investment Adviser may aggregate securities orders so long as the Investment Adviser adheres to a policy of allocating investment opportunities to the Portfolio over a period of time on a fair and equitable basis relative to other clients. In no instance will the Portfolio's securities be purchased from or sold to the Fund's principal underwriter, the Investment Adviser, or any affiliated person thereof, except to the extent permitted by SEC exemptive order or by applicable law. The Investment Adviser shall report to the Board of Directors of the Fund at least quarterly with respect to brokerage transactions that were entered into by the Investment Adviser, pursuant to the foregoing paragraph, and shall certify to the Board that the commissions paid were reasonable in terms either of that transaction or the overall responsibilities of the Adviser to the Fund and the Investment Adviser's other clients, that the total commissions paid by the Fund were reasonable in relation to the benefits to the Fund over the long term, and that such commissions were paid in compliance with Section 28(e) of the Securities Exchange Act of 1934. 5. Conformity with Law; Confidentiality. The Investment Adviser ------------------------------------ further agrees that it will comply with all applicable rules and regulations of all federal regulatory agencies having jurisdiction over the Investment Adviser in the performance of its duties hereunder. The Investment Adviser will treat confidentially and as proprietary information of the Fund all records and other information relating to the Fund and prior, present or potential shareholders (except clients of the Investment Adviser and its affiliates), and will not use such records and information for any purpose other than performance of its responsibilities and duties hereunder, except after prior notification to and approval in writing by the Fund, which approval shall not be unreasonably withheld and may not be withheld where the Investment Adviser may be exposed to civil or criminal contempt proceedings for failure to comply, when requested to divulge such information by duly constituted authorities, or when so requested by the Fund. 6. Services Not Exclusive. The Investment Adviser and its officers ---------------------- may act and continue to act as investment managers for others, and nothing in this Agreement shall in any way be deemed to restrict the right of the Investment Adviser to perform investment management or other services for any other person or entity, and the performance of such services for others -3- shall not be deemed to violate or give rise to any duty or obligation to the Portfolio or the Fund. Nothing in this Agreement shall limit or restrict the Investment Adviser or any of its partners, officers, affiliates or employees from buying, selling or trading in any securities for its or their own account. The Fund acknowledges that the Investment Adviser and its partners, officers, affiliates, employees and other clients may, at any time, have, acquire, increase, decrease, or dispose of positions in investments which are at the same time being acquired or disposed of for the Portfolio. The Investment Adviser shall have no obligation to acquire for the Portfolio a position in any investment which the Investment Adviser, its partners, officers, affiliates or employees may acquire for its or their own accounts or for the account of another client, so long as it continues to be the policy and practice of the Investment Adviser not to favor or disfavor consistently or consciously any client or class of clients in the allocation of investment opportunities so that, to the extent practical, such opportunities will be allocated among clients over a period of time on a fair and equitable basis. The Investment Adviser agrees that this Paragraph 6 does not constitute a waiver by the Fund of the obligations imposed upon the Investment Adviser to comply with Sections 17(d) and 17(j) of the 1940 Act, and the rules thereunder, nor constitute a waiver by the Fund of the obligations imposed upon the Investment Adviser under Section 206 of the Investment Advisers Act of 1940 and the rules thereunder. Further, the Investment Adviser agrees that this Paragraph 6 does not constitute a waiver by the Fund of the fiduciary obligation of the Investment Adviser arising under federal or state law, including Section 36 of the 1940 Act. The Investment Adviser agrees that this Paragraph 6 shall be interpreted consistent with the provisions of Section 17(i) of the 1940 Act. 7. Books and Records. In compliance with the requirements of Rule ----------------- 31a-3 under the 1940 Act, the Investment Adviser hereby agrees that all records which it maintains for the Portfolio are the property of the Fund and further agrees to surrender promptly to the Fund any of such records upon the Fund's request. The Investment Adviser further agrees to preserve for the periods prescribed by Rule 31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1 under the 1940 Act. 8. Expenses. During the term of this Agreement, the Investment -------- Adviser will pay all expenses incurred by it in connection with its activities under this Agreement. The Portfolio shall bear all of its own expenses not specifically assumed by the Investment Adviser. General expenses of the Fund not readily identifiable as belonging to a portfolio of the Fund -4- shall be allocated among all investment portfolios by or under the direction of the Fund's Board of Directors in such manner as the Board determines to be fair and equitable. Expenses borne by the Portfolio shall include, but are not limited to, the following (or the portfolio's share of the following): (a) the cost (including brokerage commissions) of securities purchased or sold by the Portfolio and any losses incurred in connection therewith; (b) fees payable to and expenses incurred on behalf of the Portfolio by the Investment Adviser; (c) certain of the filing fees and expenses relating to the registration and qualification of the Fund and the Portfolio's shares under Federal and/or state securities laws and maintaining such registrations and qualifications; (d) fees and salaries payable to the Fund's directors and officers; (e) taxes (including nay income or franchise taxes) and governmental fees; (f) costs of any liability and other insurance or fidelity bonds; (g) any costs, expenses or losses arising out a liability of or claim for damages or other relief asserted against the Fund or the Portfolio for violation of any law; (h) legal, accounting and auditing expenses, including legal fees of special counsel for the independent directors; (i) charges of custodians and other agents; (j) expenses of setting in type and printing prospectuses, statements of additional information and supplements thereto for existing shareholders, reports, statements, and confirmations to shareholders and proxy material that are not attributable to a class; (k) costs of mailing prospectuses, statements of additional information and supplements thereto to existing shareholders, as well as reports to shareholders and proxy material that are not attributable to a class; (1) any extraordinary expenses; (m) fees, voluntary assessments and other expenses incurred in connection with membership in investment company organizations; (n) costs of mailing and tabulating proxies and costs of shareholders, and directors' meetings; (o) costs of independent pricing services to value a portfolio's securities; and (p) the costs of investment company literature and other publications provided by the Fund to its directors and officers. Distribution expenses, transfer agency expenses, expenses of preparation, printing and mailing, prospectuses, statements of additional information, proxy statements and reports to shareholders, and organizational expenses and registration fees, identified as belonging to a particular class of the Fund are allocated to such class. If the expenses borne by the Portfolio in any fiscal year exceed the most restrictive applicable expense limitations imposed by the securities regulations of any state in which the Shares of the Portfolio are registered or qualified for sale to the public, the Investment Adviser shall reimburse the Portfolio for any excess up to the amount of the fees payable by the Portfolio to it during such fiscal year pursuant to Paragraph 9 hereof in the same proportion that its fees bear to the total fees paid by the Fund for investment advisory services in respect -5- of the Portfolio; provided, however, that notwithstanding the foregoing, the -------- ------- Investment Adviser shall reimburse the Portfolio for such excess expenses regardless of the amount of such fees payable to it during such fiscal year to the extent that the securities regulations of any state in which the Shares are registered or qualified for sale so require. 9. Voting. The Investment Adviser shall have the authority to vote ------ as agent for the Fund, either in person or by proxy, tender and take all actions incident to the ownership of all securities in which Portfolio's assets may be invested from time to time, subject to such policies and procedures as the Board of Directors of the Fund may adopt from time to time. 10. Reservation of Name. The Investment Adviser shall at all times ------------------- have all rights in and to the Portfolio's name and all investment models used by or on behalf of the Portfolio. The Investment Adviser may use the Portfolio's name or any portion thereof in connection with any other mutual fund or business activity without the consent of any shareholder and the Fund shall execute and deliver any and all documents required to indicate the consent of the Fund to such use. No public reference to, or description of, the Investment Adviser or its methodology or work shall be made by the Fund, whether in the Prospectus, Statement of Additional Information or otherwise, without the prior written consent of the Investment Adviser, which consent shall not be unreasonably withheld. In each case, the Fund shall provide the Investment Adviser a reasonable opportunity to review any such reference or description before being asked for such consent. 11. Discontinuation of Public Offering. Subject to the prior ---------------------------------- approval of the Fund's Board of Directors, the Investment Adviser may instruct the Fund's distributor to cease sales of shares of the Portfolio to new investors due to concerns that an increase in the size of the Portfolio may adversely effect the implementation of the Portfolio's investment strategy. Subject to prior Board approval, the Investment Adviser may subsequently instruct the Fund's distributor to recommence the sale of shares of the Portfolio. 12. Compensation. ------------ (a) For the services provided and the expenses assumed pursuant to this Agreement with respect to the Portfolio, the Fund will pay the Investment Adviser from the assets of the Portfolio and the Investment Adviser will accept as full compensation therefor a fee, computed daily and payable monthly, at the annual rate of .75% of the Portfolio's average daily net assets. -6- (b) The fee attributable to the Portfolio shall be satisfied only against assets of the Portfolio and not against the assets of any other investment portfolio of the Fund. 13. Limitation of Liability of the Investment Adviser. The ------------------------------------------------- Investment Adviser shall not be liable for any error of judgment or mistake of law or for any loss suffered by the Fund in connection with the matters to which this Agreement relates, except a loss resulting from a breach of fiduciary duty with respect to the receipt of compensation for services or a loss resulting from willful misfeasance, bad faith or gross negligence on the part of the Investment Adviser in the performance of its duties or from reckless disregard by it of its obligations and duties under this Agreement ("disabling conduct"). The Portfolio will indemnify the Investment Adviser against and hold it harmless from any and all losses, claims, damages, liabilities or expenses (including reasonable counsel fees and expenses) resulting from any claim, demand, action or suit not resulting from disabling conduct by the Investment Adviser. Indemnification shall be made only following: (i) a final decision on the merits by a court or other body before whom the proceeding was brought that the Investment Adviser was not liable by reason of disabling conduct or (ii) in the absence of such a decision, a reasonable determination, based upon a review of the facts, that the Investment Adviser was not liable by reason of disabling conduct by (a) the vote of a majority of a quorum of directors of the Portfolio who are neither "interested persons" of the Portfolio nor parties to the proceeding ("disinterested non-party directors") or (b) an independent legal counsel in a written opinion. The Investment Adviser shall be entitled to advances from the Portfolio for payment of the reasonable expenses incurred by it in connection with the matter as to which it is seeking indemnification in the manner and to the fullest extent permissible under the Maryland General Corporation Law. The Investment Adviser shall provide to the Portfolio a written affirmation of its good faith belief that the standard of conduct necessary for indemnification by the Portfolio has been met and a written undertaking to repay any such advance if it should ultimately be determined that the standard of conduct has not been met. In addition, at least one of the following additional conditions shall be met: (a) the Investment Adviser shall provide a security in form and amount acceptable to the Portfolio for its undertaking; (b) the Portfolio is insured against losses arising by reason of the advance; or (c) a majority of a quorum of disinterested non-party directors, or independent legal counsel, in a written opinion, shall have determined, based upon a review of facts readily available to the Portfolio at the time the advance is proposed to be made, that there is reason to believe that the Investment Adviser will ultimately be found to be entitled to indemnification. Any amounts payable by the Portfolio under this Section shall be satisfied only against the -7- assets of the Portfolio and not against the assets of any other investment portfolio of the Fund. 14. Duration and Termination. This Agreement shall become effective ------------------------ with respect to the Portfolio upon approval of this Agreement by vote of a majority of the outstanding voting securities of the Portfolio and unless sooner terminated as provided herein, shall continue with respect to the Portfolio until August 16, 1998. Thereafter, if not terminated, this Agreement shall continue with respect to the Portfolio for successive annual periods ending on August 16, provided such continuance is specifically approved at least annually -------- (a) by the vote of a majority of those members of the Board of Directors of the Fund who are not parties to this Agreement or interested persons of any such party, cast in person at a meeting called for the purpose of voting on such approval, and (b) by the Board of Directors of the Fund or by vote of a majority of the outstanding voting securities of the Portfolio; provided, however, that -------- ------- this Agreement may be terminated with respect to the Portfolio by the Fund at any time, without the payment of any penalty, by the Board of Directors of the Fund or by vote of a majority of the outstanding voting securities of the Portfolio, on 60 days' prior written notice to the Investment Adviser, or by the Investment Adviser at any time, without payment of any penalty, on 60 days, prior written notice to the Fund. This Agreement will immediately terminate in the event of its assignment. (As used in this Agreement, the terms "majority of the outstanding voting securities," "interested person" and "assignment" shall have the same meaning as such terms have in the 1940 Act). 15. Amendment of this Agreement. No provision of this Agreement may --------------------------- be changed, discharged or terminated orally, except by an instrument in writing signed by the party against which enforcement of the change, discharge or termination is sought, and no amendment of this Agreement affecting the Portfolio shall be effective until approved by vote of the holders of a majority of the outstanding voting securities of the Portfolio. 16. Miscellaneous. The captions in this Agreement are included for ------------- convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. If any provision of this Agreement shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of this Agreement shall not be affected thereby. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and shall be governed by Delaware law. 17. Change in Membership. The Investment Adviser shall notify the -------------------- Fund of any change in its membership within a reasonable time after such change. -8- 18. Counterparts. This agreement may be executed in two or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 19. Governing Law. This Agreement shall be governed by and construed ------------- and enforced in accordance with the laws of the state of Delaware without giving effect to the conflicts of laws principles thereof. IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed by their officers designated below as of the day and year first above written. THE RBB FUND, INC. By:/s/ Edward J. Roach ------------------------ President and Treasurer NUMERIC INVESTORS L.P. By:/s/ John C. Bogle Jr. ------------------------ Managing Director -9- EX-99.5Z 3 INVESTMENT ADVISORY AGREEMENT Exhibit (5)(z) INVESTMENT ADVISORY AGREEMENT ----------------------------- Boston Partners Bond Fund AGREEMENT made as of December 1, 1997 between THE RBB FUND, INC., a Maryland corporation (herein called the "Fund"), and Boston Partners Asset Management, L.P. (herein called the "Investment Advisor"). WHEREAS, the Fund is registered as an open-end, management investment company under the Investment Company Act of 1940 (the "1940 Act") and currently offers or proposes to offer shares representing interests in separate investment portfolios; and WHEREAS, the Fund desires to retain the Investment Advisor to render certain investment advisory services to the Fund with respect to the Fund's Boston Partners Bond Fund (the "Portfolio"), and the Investment Advisor is willing to so render such services. NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, and intending to be legally bound hereby, it is agreed between the parties hereto as follows: 1. Appointment. The Fund hereby appoints the Investment Advisor to ----------- act as investment advisor for the Portfolio for the period and on the terms set forth in this Agreement. The Investment Advisor accepts such appointment and agrees to render the services herein set forth, for the compensation herein provided. 2. Delivery of Documents. The Fund has furnished the Investment --------------------- Advisor with copies properly certified or authenticated of each of the following: (a) Resolutions of the Board of Directors of the Fund authorizing the appointment of the Investment Advisor and the execution and delivery of this Agreement; (b) Each prospectus and statement of additional information relating to any class of Shares representing interests in the Portfolio of the Fund in effect under the 1933 Act (such prospectus and statement of additional information, as presently in effect and as they shall from time to time be amended and supplemented, are herein collectively called the "Prospectus" and "Statement of Additional Information," respectively). The Fund will promptly furnish the Investment Advisor from time to time with copies, properly certified or authenticated, of all amendments of or supplements to the foregoing, if any. In addition to the foregoing, the Fund will also provide the Investment Advisor with copies of the Fund's Charter and By-laws, and any registration statement or service contracts related to the Portfolio, and will promptly furnish the Investment Advisor with any amendments of or supplements to such documents. 3. Management of the Portfolio. Subject to the supervision of the --------------------------- Board of Directors of the Fund, the Investment Advisor will provide for the overall management of the Portfolio including (i) the provision of a continuous investment program for the Portfolio, including investment research and management with respect to all securities, investments, cash and cash equivalents in the Portfolio, (ii) the determination from time to time of what securities and other investments will be purchased, retained, or sold by the Fund for the Portfolio, and (iii) the placement from time to time of orders for all purchases and sales made for the Portfolio. The Investment Advisor will provide the services rendered by it hereunder in accordance with the Portfolio's investment objectives, restrictions and policies as stated in the applicable Prospectus and the Statement of Additional Information, provided that the Investment Adviser has actual notice or knowledge of any changes by the Board of Directors to such investment objectives, restrictions or policies. The Investment Advisor further agrees that it will render to the Fund's Board of Directors such periodic and special reports regarding the performance of its duties under this Agreement as the Board may reasonably request. The Investment Advisor agrees to provide to the Fund (or its agents and service providers) prompt and accurate data with respect to the Portfolio's transactions and, where not otherwise available, the daily valuation of securities in the Portfolio. 4. Brokerage. Subject to the Investment Advisor's obligation to --------- obtain best price and execution, the Investment Advisor shall have full discretion to select brokers or dealers to effect the purchase and sale of securities. When the Investment Advisor places orders for the purchase or sale of securities for the Portfolio, in selecting brokers or dealers to execute such orders, the Investment Advisor is expressly authorized to consider the fact that a broker or dealer has furnished statistical, research or other information or services for the benefit of the Portfolio directly or indirectly. Without limiting the generality of the foregoing, the Investment Advisor is authorized to cause the Portfolio to pay brokerage commissions which may be in excess of the lowest rates available to brokers who execute transactions for the Portfolio or who otherwise -2- provide brokerage and research services utilized by the Investment Advisor, provided that the Investment Advisor determines in good faith that the amount of each such commission paid to a broker is reasonable in relation to the value of the brokerage and research services provided by such broker viewed in terms of either the particular transaction to which the commission relates or the Investment Advisor's overall responsibilities with respect to accounts as to which the Investment Advisor exercises investment discretion. The Investment Advisor may aggregate securities orders so long as the Investment Advisor adheres to a policy of allocating investment opportunities to the Portfolio over a period of time on a fair and equitable basis relative to other clients. In no instance will the Portfolio's securities be purchased from or sold to the Fund's principal underwriter, the Investment Advisor, or any affiliated person thereof, except to the extent permitted by SEC exemptive order or by applicable law. The Investment Advisor shall report to the Board of Directors of the Fund at least quarterly with respect to brokerage transactions that were entered into by the Investment Advisor, pursuant to the foregoing paragraph, and shall certify to the Board that the commissions paid were reasonable in terms either of that transaction or the overall responsibilities of the Advisor to the Fund and the Investment Advisor's other clients, that the total commissions paid by the Fund were reasonable in relation to the benefits to the Fund over the long term, and that such commissions were paid in compliance with Section 28(e) of the Securities Exchange Act of 1934. 5. Conformity with Law; Confidentiality. The Investment Advisor ------------------------------------ further agrees that it will comply with all applicable rules and regulations of all federal regulatory agencies having jurisdiction over the Investment Advisor in the performance of its duties hereunder. The Investment Advisor will treat confidentially and as proprietary information of the Fund all records and other information relating to the Fund and will not use such records and information for any purpose other than performance of its responsibilities and duties hereunder, except after prior notification to and approval in writing by the Fund, which approval shall not be unreasonably withheld and may not be withheld where the Investment Advisor may be exposed to civil or criminal contempt proceedings for failure to comply, when requested to divulge such information by duly constituted authorities, or when so requested by the Fund. 6. Services Not Exclusive. The Investment Advisor and its officers ---------------------- may act and continue to act as investment managers for others, and nothing in this Agreement shall in any way be deemed to restrict the right of the Investment Advisor to perform investment management or other services for any other person or entity, and the performance of such services for others -3- shall not be deemed to violate or give rise to any duty or obligation to the Portfolio or the Fund. Nothing in this Agreement shall limit or restrict the Investment Advisor or any of its partners, officers, affiliates or employees from buying, selling or trading in any securities for its or their own account. The Fund acknowledges that the Investment Advisor and its partners, officers, affiliates, employees and other clients may, at any time, have, acquire, increase, decrease, or dispose of positions in investments which are at the same time being acquired or disposed of for the Portfolio. The Investment Advisor shall have no obligation to acquire for the Portfolio a position in any investment which the Investment Advisor, its partners, officers, affiliates or employees may acquire for its or their own accounts or for the account of another client, so long as it continues to be the policy and practice of the Investment Advisor not to favor or disfavor consistently or consciously any client or class of clients in the allocation of investment opportunities so that, to the extent practical, such opportunities will be allocated among clients over a period of time on a fair and equitable basis. The Investment Advisor agrees that this Paragraph 6 does not constitute a waiver by the Fund of the obligations imposed upon the Investment Advisor to comply with Sections 17(d) and 17(j) of the 1940 Act, and the rules thereunder, nor constitute a waiver by the Fund of the obligations imposed upon the Investment Advisor under Section 206 of the Investment Advisers Act of 1940 and the rules thereunder. Further, the Investment Advisor agrees that this Paragraph 6 does not constitute a waiver by the Fund of the fiduciary obligation of the Investment Advisor arising under federal or state law, including Section 36 of the 1940 Act. The Investment Advisor agrees that this Paragraph 6 shall be interpreted consistent with the provisions of Section 17(i) of the 1940 Act. 7. Books and Records. In compliance with the requirements of Rule ----------------- 31a-3 under the 1940 Act, the Investment Advisor hereby agrees that all records which it maintains for the Portfolio are the property of the Fund and further agrees to surrender promptly to the Fund any of such records upon the Fund's request. The Investment Advisor further agrees to preserve for the periods prescribed by Rule 31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1 under the 1940 Act. 8. Expenses. During the term of this Agreement, the Investment -------- Advisor will pay all expenses incurred by it in connection with its activities under this Agreement. The Portfolio shall bear all of its own expenses not specifically assumed by the Investment Advisor. General expenses of the Fund not readily identifiable as belonging to a portfolio of the Fund -4- shall be allocated among all investment portfolios by or under the direction of the Fund's Board of Directors in such manner as the Board determines to be fair and equitable. Expenses borne by the Portfolio shall include, but are not limited to, the following (or the portfolio's share of the following): (a) the cost (including brokerage commissions) of securities purchased or sold by the Portfolio and any losses incurred in connection therewith; (b) fees payable to and expenses incurred on behalf of the Portfolio by the Investment Advisor; (c) filing fees and expenses relating to the registration and qualification of the Fund and the Portfolio's shares under federal and/or state securities laws and maintaining such registrations and qualifications; (d) fees and salaries payable to the Fund's directors and officers; (e) taxes (including any income or franchise taxes) and governmental fees; (f) costs of any liability and other insurance or fidelity bonds; (g) any costs, expenses or losses arising out a liability of or claim for damages or other relief asserted against the Fund or the Portfolio for violation of any law; (h) legal, accounting and auditing expenses, including legal fees of special counsel for the independent directors; (i) charges of custodians and other agents; (j) expenses of setting in type and printing prospectuses, statements of additional information and supplements thereto for existing shareholders, reports, statements, and confirmations to shareholders and proxy material that are not attributable to a class; (k) costs of mailing prospectuses, statements of additional information and supplements thereto to existing shareholders, as well as reports to shareholders and proxy material that are not attributable to a class; (1) any extraordinary expenses; (m) fees, voluntary assessments and other expenses incurred in connection with membership in investment company organizations; (n) costs of mailing and tabulating proxies and costs of shareholders' and directors' meetings; (o) costs of independent pricing services to value a portfolio's securities; and (p) the costs of investment company literature and other publications provided by the Fund to its directors and officers. Distribution expenses, transfer agency expenses, expenses of preparation, printing and mailing, prospectuses, statements of additional information, proxy statements and reports to shareholders, and organizational expenses and registration fees, identified as belonging to a particular class of the Fund are allocated to such class. If the expenses borne by the Portfolio in any fiscal year exceed the most restrictive applicable expense limitations imposed by the securities regulations of any state in which the Shares of the Portfolio are registered or qualified for sale to the public, the Investment Advisor shall reimburse the Portfolio for any excess up to the amount of the fees payable by the Portfolio to it during such fiscal year pursuant to Paragraph 9 hereof in the same proportion that its fees bear to the total fees paid by the Fund for investment advisory services in respect -5- of the Portfolio; provided, however, that notwithstanding the foregoing, the -------- ------- Investment Advisor shall reimburse the Portfolio for such excess expenses regardless of the amount of such fees payable to it during such fiscal year to the extent that the securities regulations of any state in which the Shares are registered or qualified for sale so require. 9. Voting. The Investment Advisor shall have the authority to vote ------ as agent for the Fund, either in person or by proxy, tender and take all actions incident to the ownership of all securities in which Portfolio's assets may be invested from time to time, subject to such policies and procedures as the Board of Directors of the Fund may adopt from time to time. 10. Reservation of Name. The Investment Advisor shall at all times ------------------- have all rights in and to the Portfolio's name and all investment models used by or on behalf of the Portfolio. The Investment Advisor may use the Portfolio's name or any portion thereof in connection with any other mutual fund or business activity without the consent of any shareholder and the Fund shall execute and deliver any and all documents required to indicate the consent of the Fund to such use. 11. Compensation. ------------ (a) For the services provided and the expenses assumed pursuant to this Agreement with respect to the Portfolio, the Fund will pay the Investment Advisor from the assets of the Portfolio and the Investment Advisor will accept as full compensation therefor a fee, computed daily and payable monthly, at the annual rate of .40% of the Portfolio's average daily net assets. (b) The fee attributable to the Portfolio shall be satisfied only against assets of the Portfolio and not against the assets of any other investment portfolio of the Fund. 12. Limitation of Liability of the Investment Advisor. The ------------------------------------------------- Investment Advisor shall not be liable for any error of judgment or mistake of law or for any loss suffered by the Fund in connection with the matters to which this Agreement relates, except a loss resulting from a breach of fiduciary duty with respect to the receipt of compensation for services or a loss resulting from willful misfeasance, bad faith or gross negligence on the part of the Investment Advisor in the performance of its duties or from reckless disregard by it of its obligations and duties under this Agreement ("disabling conduct"). The Portfolio will indemnify the Investment Advisor against and hold it harmless from any and all losses, claims, damages, liabilities or expenses (including reasonable counsel fees and expenses) resulting from any claim, demand, action or suit not resulting from disabling conduct by the Investment Advisor. -6- Indemnification shall be made only following: (i) a final decision on the merits by a court or other body before whom the proceeding was brought that the Investment Advisor was not liable by reason of disabling conduct or (ii) in the absence of such a decision, a reasonable determination, based upon a review of the facts, that the Investment Advisor was not liable by reason of disabling conduct by (a) the vote of a majority of a quorum of directors of the Portfolio who are neither "interested persons" of the Portfolio nor parties to the proceeding ("disinterested non-party directors") or (b) an independent legal counsel in a written opinion. The Investment Advisor shall be entitled to advances from the Portfolio for payment of the reasonable expenses incurred by it in connection with the matter as to which it is seeking indemnification in the manner and to the fullest extent permissible under the Maryland General Corporation Law. The Investment Advisor shall provide to the Portfolio a written affirmation of its good faith belief that the standard of conduct necessary for indemnification by the Portfolio has been met and a written undertaking to repay any such advance if it should ultimately be determined that the standard of conduct has not been met. In addition, at least one of the following additional conditions shall be met: (a) the Investment Advisor shall provide a security in form and amount acceptable to the Portfolio for its undertaking; (b) the Portfolio is insured against losses arising by reason of the advance; or (c) a majority of a quorum of disinterested non-party directors, or independent legal counsel, in a written opinion, shall have determined, based upon a review of facts readily available to the Portfolio at the time the advance is proposed to be made, that there is reason to believe that the Investment Advisor will ultimately be found to be entitled to indemnification. Any amounts payable by the Portfolio under this Section shall be satisfied only against the assets of the Portfolio and not against the assets of any other investment portfolio of the Fund. The limitations on liability and indemnification provisions of this paragraph 12 shall not be applicable to any losses, claims, damages, liabilities or expenses arising from the Investment Advisor's rights to the Portfolio's name. The Investment Advisor shall indemnify and hold harmless the Fund and the Portfolio for any claims arising from the use of the term "Boston Partners" in the name of the Portfolio. 13. Duration and Termination. This Agreement shall become effective ------------------------ with respect to the Portfolio upon approval of this Agreement by vote of a majority of the outstanding voting securities of the Portfolio and, unless sooner terminated as provided herein, shall continue with respect to the Portfolio until August 16, 1998. Thereafter, if not terminated, this Agreement shall continue with respect to the Portfolio for successive annual periods ending on August 16 provided such continuance is specifically approved at least -------- annually (a) by the -7- vote of a majority of those members of the Board of Directors of the Fund who are not parties to this Agreement or interested persons of any such party, cast in person at a meeting called for the purpose of voting on such approval, and (b) by the Board of Directors of the Fund or by vote of a majority of the outstanding voting securities of the Portfolio; provided, however, that this -------- ------- Agreement may be terminated with respect to the Portfolio by the Fund at any time, without the payment of any penalty, by the Board of Directors of the Fund or by vote of a majority of the outstanding voting securities of the Portfolio, on 60 days' prior written notice to the Investment Advisor, or by the Investment Advisor at any time, without payment of any penalty, on 60 days' prior written notice to the Fund. This Agreement will immediately terminate in the event of its assignment. (As used in this Agreement, the terms "majority of the outstanding voting securities," "interested person" and "assignment" shall have the same meaning as such terms have in the 1940 Act). 14. Amendment of this Agreement. No provision of this Agreement may --------------------------- be changed, discharged or terminated orally, except by an instrument in writing signed by the party against which enforcement of the change, discharge or termination is sought, and no amendment of this Agreement affecting the Portfolio shall be effective until approved by vote of the holders of a majority of the outstanding voting securities of the Portfolio. 15. Miscellaneous. The captions in this Agreement are included for ------------- convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. If any provision of this Agreement shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of this Agreement shall not be affected thereby. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and shall be governed by Delaware law. 16. Change in Membership. The Investment Advisor shall notify the -------------------- Fund of any change in its membership within a reasonable time after such change. 17. Governing Law. This Agreement shall be governed by and construed ------------- and enforced in accordance with the laws of the State of Delaware without giving effect to the conflicts of laws principles thereof. -8- 18. Counterparts. This Agreement may be executed in two or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed by their officers designated below as of the day and year first above written. THE RBB FUND, INC. By:/s/ Edward J. Roach ---------------------------------- Edward J. Roach President and Treasurer BOSTON PARTNERS ASSET MANAGEMENT, L.P., by BOSTON PARTNERS, INC., its General Partner By:/s/ William J.Kelly ---------------------------------- William J. Kelly, Treasurer -9- EX-99.6LL 4 DISTRIBUTION AGREEMENT SUPPLEMENT Exhibit (6)(ll) DISTRIBUTION AGREEMENT SUPPLEMENT (n/i Numeric Investors Family of Funds - Class XX) This supplemental agreement is entered into this 1st day of December, 1997, by and between THE RBB FUND, INC. (the "Fund") and COUNSELLORS SECURITIES INC. (the "Distributor"). The Fund is a corporation organized under the laws of the State of Maryland and is an open-end management investment company. The Fund and the Distributor have entered into a Distribution Agreement, dated as of April 10, 1991 (as from time to time amended and supplemented, the "Distribution Agreement"), pursuant to which the Distributor has undertaken to act as distributor for the Fund, as more fully set forth therein. Certain capitalized terms used without definition in this Distribution Agreement Supplement have the meaning specified in the Distribution Agreement. The Fund agrees with the Distributor as follows: 1. Adoption of Distribution Agreement. The Distribution Agreement is ---------------------------------- hereby adopted for the n/i Numeric Investors Larger Cap Value Fund Class of Common Stock (Class XX) of the Fund. This class shall constitute a "Class" as referred to in the Distribution Agreement and its shares shall be "Class Shares" as referred to therein. 2. Payment of Fees. For all services to be rendered, facilities furnished --------------- and expenses paid or assumed by the Distributor as provided in the Distribution Agreement and herein, the Fund shall pay the Distributor no compensation. 3. Counterparts. This agreement may be executed in two or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the undersigned have entered into this Agreement, intending to be legally bound hereby, as of the date and year first above written. THE RBB FUND, INC. COUNSELLORS SECURITIES INC. By:/s/ Edward J. Roach By:/s/ Eugene Grace ----------------------- ---------------------------- President and Treasurer EX-99.6MM 5 DISTRIBUTION AGREEMENT SUPPLEMENT Exhibit (6)(mm) DISTRIBUTION AGREEMENT SUPPLEMENT (Boston Partners Bond Fund) (Institutional Class) This supplemental agreement is entered into this 1st day of December, 1997, by and between THE RBB FUND, INC. (the "Fund") and COUNSELLORS SECURITIES, INC. (the "Distributor"). The Fund is a corporation organized under the laws of the State of Maryland and is an open-end management investment company. The Fund and the Distributor have entered into a Distribution Agreement, dated as of April 10, 1991 (as from time to time amended and supplemented, the "Distribution Agreement"), pursuant to which the Distributor has undertaken to act as distributor for the Fund, as more fully set forth therein. Certain capitalized terms used without definition in this Distribution Agreement Supplement have the meaning specified in the Distribution Agreement. The Fund agrees with the Distributor as follows: 1. Adoption of Distribution Agreement. The Distribution Agreement is ---------------------------------- hereby adopted for the Boston Partners Bond Fund Institutional Class of Common Stock (Class VV) of the Fund. 2. Payment of Fees. For all services to be rendered, facilities furnished --------------- and expenses paid or assumed by the Distributor as provided in the Distribution Agreement and herein, the Fund shall pay the Distributor a monthly 12b-1 fee on the first business day of each month, based upon the average daily value (as determined on each business day at the time set forth in the Prospectus for determining net asset value per share) of the net assets of the Class during the preceding month, at an annual rate of 0.15%. 3. Counterparts. This Agreement may be executed in two or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the undersigned have entered into this Agreement, intending to be legally bound hereby, as of the date and year first above written. THE RBB FUND, INC. COUNSELLORS SECURITIES, INC. By: /s/Edward J. Roach By: /s/ Eugene Grace ----------------------- ----------------------------- Name: Edward J. Roach Name:Eugene Grace Title: President and Treasurer Title: EX-99.6NN 6 DISTRIBUTION AGREEMENT SUPPLEMENT Exhibit (6)(nn) DISTRIBUTION AGREEMENT SUPPLEMENT (Boston Partners Bond Fund) (Investor Class) This supplemental agreement is entered into this 1st day of December, 1997, by and between THE RBB FUND, INC. (the "Fund") and COUNSELLORS SECURITIES, INC. (the "Distributor"). The Fund is a corporation organized under the laws of the State of Maryland and is an open-end management investment company. The Fund and the Distributor have entered into a Distribution Agreement, dated as of April 10, 1991 (as from time to time amended and supplemented, the "Distribution Agreement"), pursuant to which the Distributor has undertaken to act as distributor for the Fund, as more fully set forth therein. Certain capitalized terms used without definition in this Distribution Agreement Supplement have the meaning specified in the Distribution Agreement. The Fund agrees with the Distributor as follows: 1. Adoption of Distribution Agreement. The Distribution Agreement is ---------------------------------- hereby adopted for the Boston Partners Bond Fund Investor Class of Common Stock (Class WW) of the Fund. 2. Payment of Fees. For all services to be rendered, facilities furnished --------------- and expenses paid or assumed by the Distributor as provided in the Distribution Agreement and herein, the Fund shall pay the Distributor a monthly 12b-1 fee on the first business day of each month, based upon the average daily value (as determined on each business day at the time set forth in the Prospectus for determining net asset value per share) of the net assets of the Class during the preceding month, at an annual rate of 0.25%. 3. Counterparts. This Agreement may be executed in two or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the undersigned have entered into this Agreement, intending to be legally bound hereby, as of the date and year first above written. THE RBB FUND, INC. COUNSELLORS SECURITIES, INC. By: /s/Edward J. Roach By: /s/ Eugene Grace --------------------- --------------------------------- Name: Edward J. Roach Name: Eugene Grace Title: President and Treasurer Title: EX-99.8P 7 CUSTODIAL AGREEMENT Exhibit (8)(p) FORM CUSTODY AGREEMENT AGREEMENT, dated as of December ___, 1997 by and between THE RBB FUND, INC. (the "Company"), a corporation organized and existing under the laws of the State of Maryland, acting with respect to and on behalf of the N/I LARGER CAP VALUE FUND (the "Fund"), and CUSTODIAL TRUST COMPANY, a bank organized and existing under the laws of the State of New Jersey (the "Custodian"). WHEREAS, the Company on behalf of the Fund desires that the Fund's securities, cash and other assets be held and administered by Custodian pursuant to this Agreement; WHEREAS, the Fund is an investment portfolio represented by a series of Shares constituting part of the capital stock of the Company, an open-end management investment company registered under the 1940 Act (as hereinafter defined); WHEREAS, Custodian represents that it is a bank having the qualifications prescribed in Section 26(a)(i) of the 1940 Act; NOW, THEREFORE, in consideration of the mutual agreements herein made, the Company on behalf of the Fund and Custodian hereby agree as follows: ARTICLE I DEFINITIONS ----------- Whenever used in this Agreement, the following terms, unless the context otherwise requires, shall mean: 1.1 "AUTHORIZED PERSON" means any Officer or other person duly authorized ----------------- by resolution of the Board of Directors to give Oral Instructions and Written Instructions on behalf of the Fund and identified, by name or by office, in Exhibit A hereto or any person duly designated to do so by an investment adviser of the Fund specified by the Fund in Exhibit B hereto. 1.2 "BOARD OF DIRECTORS" means the Board of Directors of the Company or, ------------------ when permitted under the 1940 Act, the Executive Committee thereof, if any. 1.3 "BOOK-ENTRY SYSTEM" means a book-entry system maintained by a Federal ----------------- Reserve bank as provided for in Subpart O of Treasury Circular No. 300, 31 CFR 306, in Subpart B of 31 CFR Part 350, or in such other book-entry regulations of federal agencies as are substantially in the form of such Subpart O. 1.4 "BUSINESS DAY" means any day recognized as a settlement day by The New ------------ York Stock Exchange, Inc. and on which banks in the State of New Jersey are open for business. 1.5 "CUSTODY ACCOUNT" means the account in the name of the Fund, which is --------------- provided for in Section 3.2 below. 1.6 "MASTER REPURCHASE AGREEMENT" means that certain Master Repurchase --------------------------- Agreement of even date herewith between the Company on behalf of the Fund and Bear, Stearns & Co. Inc., an affiliate of Custodian ("Bear Stearns"), as it may from time to time be amended. 1.7 "1940 ACT" means the Investment Company Act of 1940, as amended, and -------- the rules and regulations thereunder. -2- 1.8 "OFFICER" means the President, any Vice President, the Secretary, any ------- Assistant Secretary, the Treasurer, or any Assistant Treasurer of the Company. 1.9 "ORAL INSTRUCTIONS" means instructions orally transmitted to and ----------------- accepted by Custodian which are (a) reasonably believed by Custodian to have been given by an Authorized Person, (b) recorded and kept among the records of Custodian made in the ordinary course of business, (c) orally confirmed by Custodian, and (d) completed in accordance with Custodian's requirements from time to time as to content of instructions and their manner and timeliness of delivery by the Fund. 1.10 "PROPER INSTRUCTIONS" means Oral Instructions or Written ------------------- Instructions. Proper Instructions may be continuing Written Instructions when deemed appropriate by both parties. 1.11 "SECURITIES" includes, without limitation, common and preferred ---------- stocks, bonds, call options, put options, debentures, notes, bank certificates of deposit, forward contracts, futures contracts (including those related to indexes), options on futures contracts or indexes, bankers' acceptances, mortgage-backed securities or other obligations, and any certificates, receipts, warrants or other instruments or documents representing rights to receive, purchase or subscribe for the same, or evidencing or representing any other rights or interests therein, or any similar property or assets that Custodian has the facilities to clear and to service. -3- 1.12 "SECURITIES LOAN AGREEMENT" means that certain Securities Loan ------------------------- Agreement of even date herewith between the Company on behalf of the Fund and Bear, Stearns Securities Corp. ("BSSC"), as it may from time to time be amended. 1.13 "SECURITIES DEPOSITORY" means The Depository Trust Company and --------------------- (provided that Custodian has received a copy of a resolution of the Board of Directors of the Company, certified by an Officer, specifically approving the use thereof as a depository for the Fund) any other clearing agency registered with the Securities and Exchange Commission under Section 17A of the Securities Exchange Act of 1934 (the "1934 Act"), which acts as a system for the central handling and deposit of Securities where all Securities of any particular class or series of an issuer deposited within the system are treated as fungible and may be transferred or pledged by bookkeeping entry without physical delivery of the Securities. 1.14 "SHARES" means those shares in a series or class of the capital stock ------ of the Company that represent interests in the Fund. 1.15 "WRITTEN INSTRUCTIONS" means written communications received by -------------------- Custodian that are (a) reasonably believed by Custodian to have been signed or - sent by any two Authorized Persons, (b) sent or transmitted by letter, - facsimile, central processing unit connection, on-line terminal or magnetic tape, and (c) completed in accordance with Custodian's requirements - -4- from time to time as to content of instructions and their manner and timeliness of delivery by the Fund. ARTICLE II APPOINTMENT OF CUSTODIAN ------------------------ 2.1 APPOINTMENT. The Company on behalf of the Fund hereby appoints ----------- Custodian as custodian of all such Securities, cash and other assets as may be acceptable to Custodian and from time to time delivered to it by the Fund or others for the account of the Fund. 2.2 ACCEPTANCE. Custodian hereby accepts appointment as such custodian ---------- and agrees to perform the duties thereof as hereinafter set forth. ARTICLE III CUSTODY OF CASH AND SECURITIES ------------------------------ 3.1 SEGREGATION. All Securities and non-cash property of the Fund in the ----------- possession of Custodian (other than Securities maintained by Custodian in a Securities Depository or Book-Entry System) shall be physically segregated from other Securities and non-cash property in the possession of Custodian and shall be identified as belonging to the Fund. 3.2 CUSTODY ACCOUNT. (a) Custodian shall open and maintain in its trust --------------- department a custody account in the name of the Fund, subject only to draft or order of Custodian, in which Custodian shall enter and carry all securities, cash and other assets of the Fund which are delivered to Custodian and accepted by it. Custodian shall not be under any duty or obligation to -5- require the Fund to deliver to it any Securities or funds owned by the Fund and shall have no responsibility or liability for or on account of Securities or funds not so delivered. (b) If Custodian at any time fails to receive any of the documents referred to in Section 3.5(a) below, then, until such time as it receives such document, it shall not be obligated to receive any Securities of the Fund into the Custody Account and shall be entitled to return to the Fund any Securities of the Fund that it is holding. (c) Custodian may, but shall not be obligated to, hold Securities that may be held only in physical form. (d) Custodian is authorized to disclose the name, address and securities positions of the Fund to the issuers of such securities when requested by them to do so. 3.3 APPOINTMENT OF AGENTS. (a) Custodian may employ suitable agents, --------------------- which may include affiliates of Custodian, such as Bear Stearns or BSSC, both of which are registered broker-dealers. The appointment of any agent pursuant to this Section 3.3(a) shall not relieve Custodian of any of its obligations or liabilities under this Agreement. However, no Book-Entry System, Securities Depository or other securities depository or clearing agency which it is or may become standard market practice to use for the comparison and settlement of trades in securities shall be an agent or sub-contractor of Custodian for purposes of this Section 3.3(a) or otherwise. -6- (b) Upon notification of the Fund and in its discretion, Custodian may appoint, and, upon notification of the Fund, at any time remove, any domestic bank or trust company which is qualified to act as a custodian under the 1940 Act as sub-custodian to hold Securities and cash of the Fund and to carry out such other provisions of this Agreement as it may determine, and, upon notification of the Fund, may also open and maintain one or more banking accounts with such a bank or trust company (any such accounts to be in the name of Custodian and subject only to its draft or order), provided, however, that the appointment of any such agent or opening and maintenance of any such accounts shall be at Custodian's expense and shall not relieve Custodian of any of its obligations or liabilities under this Agreement. (c) Upon receipt of Written Instructions to do so and at the Fund's expense, Custodian shall appoint as sub-custodian such domestic bank or trust company as is named therein, provided that (i) such bank or trust company is qualified to act as a custodian under the 1940 Act, and (ii) notwithstanding anything to the contrary in Section 9.1 below or elsewhere in this Agreement, Custodian shall have no greater liability to the Fund for the actions or omissions of any such sub-custodian than any such sub-custodian has to Custodian, and Custodian shall not be required to discharge any such liability which may be imposed on it unless and until such sub-custodian has effectively -7- indemnified Custodian against it or has otherwise discharged its liability to Custodian in full. 3.4 Delivery of Assets to Custodian. The Fund shall deliver to Custodian ------------------------------- the Fund's Securities, cash and other assets, which are acceptable to Custodian, including (a) payments of income, payments of principal and capital distributions received by the Fund with respect to such Securities, cash or other assets owned by the Fund at any time during the term of this Agreement, and (b) cash received by the Fund for the issuance, at any time during such term, of Shares. Custodian shall not be responsible for such Securities, cash or other assets until actually received by it. 3.5 Securities Depositories and Book-Entry Systems. Custodian may deposit ---------------------------------------------- and/or maintain Securities of the Fund in a Securities Depository or in a Book- Entry System, subject to the following provisions: (a) Prior to a deposit of Securities of the Fund in any Securities Depository or Book-Entry System, the Fund shall deliver to Custodian a resolution of the Board of Directors of the Company, certified by an Officer, authorizing and instructing Custodian (and any sub-custodian appointed pursuant to Section 3.3 above) on an on-going basis to deposit in such Securities Depository or Book-Entry System all Securities eligible for deposit therein and to make use of such Securities Depository or Book-Entry System to the extent possible and practical in connection with its performance hereunder (or under the -8- applicable sub-custody agreement in the case of such sub-custodian), including, without limitation, in connection with settlements of purchases and sales of Securities, loans of Securities, and deliveries and returns of collateral consisting of Securities. (b) Securities of the Fund kept in a Book-Entry System or Securities Depository shall be kept in an account ("Depository Account") of Custodian in such Book-Entry System or Securities Depository which includes only assets held by Custodian as a fiduciary, custodian or otherwise for customers. (c) The records of Custodian with respect to Securities of the Fund maintained in a Book-Entry System or Securities Depository shall at all times identify such Securities as belonging to the Fund. (d) If Securities purchased by the Fund are to be held in a Book-Entry System or Securities Depository, Custodian shall pay for such Securities upon (i) receipt of advice from the Book-Entry System or Securities Depository that such Securities have been transferred to the Depository Account, and (ii) the making of an entry on the records of Custodian to reflect such payment and transfer for the account of the Fund. If Securities sold by the Fund are held in a Book-Entry System or Securities Depository, Custodian shall transfer such Securities upon (i) receipt of advice from the Book-Entry System or Securities Depository that payment for such Securities has been transferred to the Depository Account, and (ii) the making of an entry on the -9- records of Custodian to reflect such transfer and payment for the account of the Fund. (e) Custodian shall provide the Fund with copies of any report obtained by Custodian from a Book-Entry System or Securities Depository in which Securities of the Fund are kept on the internal accounting controls and procedures for safeguarding Securities deposited in such Book-Entry System or Securities Depository. (f) At its election, the Company on behalf of the Fund shall be subrogated to the rights of Custodian with respect to any claim against a Book- Entry System or Securities Depository or any other person for any loss or damage to the Fund arising from the use of such Book-Entry System or Securities Depository, if and to the extent that the Fund has not been made whole for any such loss or damage. 3.6 Disbursement of Moneys from the Custody Account. Upon receipt of ----------------------------------------------- Proper Instructions, but subject to its right to foreclose upon and liquidate collateral pledged to it pursuant to Section 10.3 below, Custodian shall make payments from the Custody Account, but only in the following cases, provided, first, that such payments are in connection with the clearance and/or custody of - ----- Securities or other assets, second, that there are sufficient funds in the ------ Custody Account, whether belonging to the Fund or advanced to it by Custodian in its sole and absolute discretion as set forth in Section 4.5 below, for Custodian to make such payments and, third, that after the making of such ----- -10- payments, the Fund would not be in violation of any margin or other requirements agreed upon pursuant to Section 4.5 below: (a) For the purchase of Securities for the Fund but only (i) in the case of Securities (other than options on Securities, futures contracts and options on futures contracts), against the delivery to Custodian (or any sub- custodian appointed pursuant to Section 3.3 above) of such Securities registered as provided in Section 3.9 below or in proper form for transfer or, if the purchase of such Securities is effected through a Book-Entry System or Securities Depository, in accordance with the conditions set forth in Section 3.5 above; (ii) in the case of options on Securities, against delivery to Custodian (or such sub-custodian) of such receipts as are required by the customs prevailing among dealers in such options; (iii) in the case of futures contracts and options on futures contracts, against delivery to Custodian (or such sub-custodian) of evidence of title thereto in favor of the Fund, the Custodian, any such sub-custodian or any nominee referred to in Section 3.9 below; and (iv) in the case of repurchase or reverse repurchase agreements entered into by the Fund, against delivery of the purchased Securities either in certificate form or through an entry crediting Custodian's account at a Book- Entry System or Securities Depository with such Securities; (b) In connection with the conversion, exchange or surrender, as set forth in Section 3.7(f) below, of Securities owned by the Fund; -11- (c) For the payment as provided in Article V below of any dividends or other distributions declared by the Fund on the Shares; (d) In payment of the redemption price of Shares as provided in Article V below; (e) For the payment of any expense or liability incurred by the Fund, including but not limited to the following payments for the account of the Fund: interest, taxes, administration, investment management, investment advisory, accounting, auditing, transfer agent, custodian, trustee and legal fees; and other operating expenses of the Fund; in all cases, whether or not such expenses are to be in whole or in part capitalized or treated as deferred expenses; (f) For transfer in accordance with the provisions of any agreement among the Company on behalf of the Fund, Custodian and a broker-dealer, relating to compliance with rules of The Options Clearing Corporation and of any registered national securities exchange (or of any similar organization or organizations) regarding escrow or other arrangements in connection with transactions by the Fund; (g) For transfer in accordance with the provisions of any agreement among the Company on behalf of the Fund, Custodian, and a futures commission merchant, relating to compliance with the rules of the Commodity Futures Trading Commission and/or any contract market (or any similar organization or organizations) -12- regarding account deposits in connection with transactions by the Fund; (h) For the funding of any uncertificated time deposit or other interest-bearing account with any banking institution (including Custodian), but only if the payment instructions to Custodian detail specific Securities to be acquired; (i) For the purchase from a bank or other financial institution of loan participations, but only if Custodian has in its possession a copy of the agreement between the Company on behalf of the Fund and such bank or other financial institution with respect to the purchase of such loan participations and the payment instructions to Custodian detail specific assets to be acquired; (j) For transfer to a broker-dealer registered under the 1934 Act in accordance with the provisions of any agreement among the Company on behalf of the Fund, Custodian and such a broker-dealer as margin for a short sale of Securities; (k) For the payment of amounts due in lieu of dividends paid on Securities sold short by the Fund; and (l) For any other proper purpose, but only upon receipt, in addition to Proper Instructions, of a copy of a resolution of the Board of Directors, certified by an Officer, specifying the amount and purpose of such payment, declaring such purpose to be a proper purpose of the Fund, and naming the person or persons to whom such payment is to be made. -13- 3.7 Delivery of Securities from the Custody Account. Upon receipt of ----------------------------------------------- Proper Instructions, but subject to its right to foreclose upon and liquidate collateral pledged to it pursuant to Section 10.3 below, Custodian shall release and deliver Securities and other assets from the Custody Account, but only in the following cases, provided, first, that such deliveries are in connection ----- with the clearance and/or custody of Securities or other assets, second, that ------ there are sufficient amounts and types of Securities or other assets in the Custody Account for Custodian to make such delivery, and, third, that after the ----- making of such delivery, the Fund would not be in violation of any margin or other requirements agreed upon pursuant to Section 4.5 below: (a) Upon the sale of Securities for the account of the Fund but, subject to Section 4.3 below, only against receipt of payment therefor in cash, by certified or cashiers' check or bank credit; (b) In the case of a sale effected through a Book-Entry System or Securities Depository, in accordance with the provisions of Section 3.5 above; (c) To an offeror's depository agent in connection with tender or other similar offers for Securities of the Fund; provided that, in any such case, the cash or other consideration is to be delivered to Custodian; (d) To the issuer thereof or its agent (i) for transfer into the name of the Fund or any of the nominees -14- referred to in Section 3.9 below, or (ii) for exchange for a different number of certificates or other evidence representing the same aggregate face amount or number of units; provided that, in any such case, the new Securities are to be delivered to Custodian; (e) To the broker selling Securities, for examination in accordance with the "street delivery" custom; (f) For exchange or conversion pursuant to any plan of merger, consolidation, recapitalization, reorganization or readjustment of the issuer of such Securities, or pursuant to provisions for conversion contained in such Securities, or pursuant to any deposit agreement, including surrender or receipt of underlying Securities in connection with the issuance or cancellation of depository receipts; provided that, in any such case, the new Securities and cash, if any, are to be delivered to Custodian; (g) Upon receipt of payment therefor pursuant to any repurchase agreement entered into by the Fund; (h) In the case of warrants, rights or similar Securities, upon the exercise thereof, provided that, in any such case, the new Securities and cash, if any, are to be delivered to Custodian; (i) For delivery in connection with any loans of Securities pursuant to any securities loan agreement entered into by the Company on behalf of the Fund, but only against receipt of -15- such collateral as is required under such securities loan agreement; (j) For delivery as security in connection with any borrowings by the Fund requiring a pledge of assets by the Fund, but only against receipt by Custodian of the amounts borrowed; (k) Pursuant to any authorized plan of liquidation, reorganization, merger, consolidation or recapitalization of the Fund; (l) For delivery in accordance with the provisions of any agreement among the Company on behalf of the Fund, Custodian and a broker-dealer, relating to compliance with the rules of The Options Clearing Corporation and of any registered national securities exchange (or of any similar organization or organizations) regarding escrow or other arrangements in connection with transactions by the Fund; (m) For delivery in accordance with the provisions of any agreement among the Company on behalf of the Fund, Custodian, and a futures commission merchant, relating to compliance with the rules of the Commodity Futures Trading Commission and/or any contract market (or any similar organization or organizations) regarding account deposits in connection with transactions by the Fund; (n) For delivery to a broker-dealer registered under the 1934 Act or in accordance with the provisions of any agreement among the Company on behalf of the Fund, Custodian and such a broker-dealer as margin for a short sale of Securities; -16- (o) For any other proper purpose, but only upon receipt, in addition to Proper Instructions, of a copy of a resolution of the Board of Directors, certified by an Officer, specifying the Securities to be delivered, setting forth the purpose for which such delivery is to be made, declaring such purpose to be a proper purpose of the Fund, and naming the person or persons to whom delivery of such Securities is to be made. 3.8 Actions Not Requiring Proper Instructions. Unless otherwise ----------------------------------------- instructed by the Fund, Custodian shall with respect to all Securities held for the Fund: (a) Subject to Section 9.4 below, collect on a timely basis all income and other payments to which the Fund is entitled either by law or pursuant to custom in the securities business; (b) Subject to Section 9.4 below, collect on a timely basis the amount payable upon or with respect to all Securities and other assets which may mature or be called, redeemed, retired or otherwise become payable; (c) Endorse for collection, in the name of the Fund, checks, drafts and other negotiable instruments; (d) Surrender interim receipts or Securities in temporary form for Securities in definitive form; (e) Execute, as custodian, any necessary declarations or certificates of ownership under the federal income tax laws or the laws or regulations of any other taxing authority now or hereafter in effect, and prepare and submit reports to the Internal Revenue Service ("IRS") and to the Fund at such time, in -17- such manner and containing such information as is prescribed by the IRS; (f) Hold for the Fund all rights and similar securities issued with respect to Securities of the Fund; and (g) In general, attend to all non-discretionary details in connection with the sale, exchange, substitution, purchase and transfer of, and other dealings in, Securities and other assets of the Fund. 3.9 Registration and Transfer of Securities. All Securities held for the --------------------------------------- Fund that are issuable only in bearer form shall be held by Custodian in that form, provided that any such Securities shall be held in a Book-Entry System if eligible therefor. All other Securities held for the Fund may be registered in the name of Custodian as agent, any sub-custodian appointed pursuant to Section 3.3 above, any Securities Depository, or any nominee or agent of any of them. The Fund shall furnish to Custodian appropriate instruments to enable Custodian to hold or deliver in proper form for transfer, or to register as in this Section 3.9 provided, any Securities delivered to Custodian which are registered in the name of the Fund. 3.10 Records. (a) Custodian shall maintain complete and accurate records ------- with respect to Securities, cash or other property held for the Fund, including (i) journals or other records of original entry containing an itemized daily record in detail of all receipts and deliveries of Securities and all -18- receipts and disbursements of cash; (ii) ledgers (or other records) reflecting (A) Securities in transfer, if any, (B) Securities in physical possession, (C) monies and Securities borrowed and monies and Securities loaned (together with a record of the collateral therefor and substitutions of such collateral), (D) dividends and interest received, and (E) dividends receivable and interest accrued; and (iii) cancelled checks and bank records related thereto. Custodian shall keep such other books and records with respect to Securities, cash and other property of the Fund which is held hereunder as the Fund may reasonably request. (b) All such books and records maintained by Custodian shall (i) be maintained in a form acceptable to the Fund and in compliance with rules and regulations of the Securities and Exchange Commission, (ii) be the property of the Fund and at all times during the regular business hours of Custodian be made available upon request for inspection by duly authorized officers, employees or agents of the Company on behalf of the Fund and employees or agents of the Securities and Exchange Commission, and (iii) if required to be maintained by Rule 31a-1 under the 1940 Act, be preserved for the periods prescribed in Rule 31a-2 under the 1940 Act. 3.11 Account Reports by Custodian. Custodian shall furnish the Fund with ---------------------------- a daily activity statement, including a summary of all transfers to or from the Custody Account, on the day following such transfers. At least monthly and from time to -19- time, Custodian shall furnish the Fund with a detailed statement of the Securities and moneys held for the Fund under this Agreement. 3.12 Other Reports by Custodian. Custodian shall provide the Fund with -------------------------- such reports as the Fund may reasonably request from time to time on the internal accounting controls and procedures for safeguarding Securities which are employed by Custodian or any sub-custodian appointed pursuant to Section 3.3 above. 3.13 Proxies and Other Materials. Unless otherwise instructed by the --------------------------- Fund, Custodian shall promptly deliver to the Fund all notices of meetings, proxy materials (other than proxies) and other announcements, which it receives regarding Securities held by it in the Custody Account. Whenever Custodian or any of its agents receives a proxy with respect to Securities in the Custody Account, Custodian shall promptly request instructions from the Fund on how such Securities are to be voted, and shall give such proxy, or cause it to be given, in accordance with such instructions. If the Fund timely informs Custodian that the Fund wishes to vote any such Securities in person, Custodian shall promptly seek to have a legal proxy covering such Securities issued to the Fund. Unless otherwise instructed by the Fund, neither Custodian nor any of its agents shall exercise any voting rights with respect to Securities held hereunder. -20- 20 3.14 Information on Corporate Actions. Unless otherwise instructed by the -------------------------------- Fund, Custodian shall promptly transmit to the Fund all other written information received by Custodian from issuers of Securities held in the Custody Account. With respect to tender or exchange offers for such Securities, or other corporate transactions involving such Securities, Custodian shall promptly transmit to the Fund all written information received by Custodian from the issuers of such Securities or from any party (or its agents) making any such tender or exchange offer or participating in such other corporate transaction. If the Fund desires, with respect to any such tender or exchange offer or other corporate transaction, to take any action that may be taken by it pursuant to the terms of such offer or other transaction, the Fund shall notify Custodian at least five Business Days prior to the date on which Custodian is to take such action. 3.15 Co-operation. Custodian shall cooperate with and supply necessary ------------ information to the entity or entities appointed by the Company on behalf of the Fund to keep the books of account of the Fund and/or to compute the value of the assets of the Fund. ARTICLE IV PURCHASE AND SALE OF INVESTMENTS OF THE FUND -------------------------------------------- 4.1 Purchase of Securities. Promptly upon each purchase of Securities for ---------------------- the Fund, Written Instructions shall be delivered to Custodian, specifying (a) the name of the issuer or writer of such Securities, and the title or other description thereof, (b) -21- 21 the number of shares, principal amount (and accrued interest, if any), or other units purchased, (c) the date of purchase and settlement, (d) the purchase price per unit, (e) the total amount payable upon such purchase, and (f) the name of the person to whom such amount is payable. Custodian shall upon receipt of such Securities purchased by the Fund (or, if the Securities are transferred by means of a private placement transaction, upon the receipt of such Securities or payment instructions to Custodian which detail specific Securities to be acquired) pay out of the moneys held for the account of the Fund the total amount specified in such Written Instructions to the person named therein. 4.2 Sale of Securities. Promptly upon each sale of Securities by the ------------------ Fund, Written Instructions shall be delivered to Custodian, specifying (a) the name of the issuer or writer of such Securities, and the title or other description thereof, (b) the number of shares, principal amount (and accrued interest, if any), or other units sold, (c) the date of sale and settlement, (d) the sale price per unit, (e) the total amount payable upon such sale, and (f) the person to whom such Securities are to be delivered. Upon receipt of the total amount payable to the Fund as specified in such Written Instructions, Custodian shall deliver such Securities to the person specified in such Written Instructions. Subject to the foregoing, Custodian may accept payment in such form as shall be satisfactory to it, and may -22- 22 deliver Securities and arrange for payment in accordance with the customs prevailing among dealers in Securities. 4.3 Delivery of Securities Sold. Notwithstanding Section 4.2 above or any --------------------------- other provision of this Agreement, Custodian, when instructed to deliver Securities against payment, shall be entitled, but only if in accordance with generally accepted market practice, to deliver such Securities prior to actual receipt of final payment therefor and, exclusively in the case of Securities in physical form, to deliver such Securities prior to receipt of payment. In any such case, the Fund shall bear the risk that final payment for such Securities may not be made or that such Securities may be returned or otherwise held or disposed of by or through the person to whom they were delivered, and Custodian shall have no liability for any of the foregoing. 4.4 Payment for Securities Sold, etc. In its sole discretion and from --------------------------------- time to time, Custodian may credit the Custody Account, prior to actual receipt of final payment thereof, with (a) proceeds from the sale of Securities which it has been instructed to deliver against payment, (b) proceeds from the redemption of Securities or other assets of the Fund, and (c) income from cash, Securities or other assets of the Fund. Any such credit shall be conditional upon actual receipt by Custodian of final payment and may be reversed if final payment is not actually received in full. Custodian may, in its sole discretion and from time to time, permit the Fund to use funds so credited to the Custody Account in anticipation of actual receipt of final -23- 23 payment. Any funds so used shall constitute an advance subject to Section 4.5 below. 4.5 CLEARING CREDIT. Custodian may, in its sole discretion and from time --------------- to time, advance funds to the Fund to facilitate the settlement of the Fund's transactions in the Custody Account. Any such advance (a) shall be repayable - immediately upon demand made by Custodian, (b) shall be fully secured as - provided in Section 10.3 below, and (c) shall bear interest at such rate, and be - subject to such other terms and conditions, as Custodian and the Company on behalf of the Fund may agree. 4.6 FINAL PAYMENT. For purposes of this Agreement, "final payment" means ------------- payment in funds which are (or have become) immediately available, under applicable law are irreversible, and are not subject to any security interest, levy, lien or other encumbrance. ARTICLE V REDEMPTION OF FUND SHARES; DIVIDENDS AND OTHER DISTRIBUTIONS --------------------------------- 5.1 Transfer of Funds. From such funds as may be available for the ----------------- purpose in the Custody Account, and upon receipt of Proper Instructions specifying that the funds are required to redeem Shares or to pay dividends or other distributions to holders of Shares, Custodian shall transfer each amount specified in such Proper Instructions to such account of the Fund or of an agent thereof (other than Custodian), at such bank, as the Fund may designate therein with respect to such amount. -24- 24 5.2 Sole Duty of Custodian. Custodian's sole obligation with respect to ---------------------- the redemption of Shares and the payment of dividends and other distributions thereon shall be its obligation set forth in Section 5.1 above, and Custodian shall not be required to make any payments to the various holders from time to time of Shares nor shall Custodian be responsible for the payment or distribution by the Fund, or any agent designated in Proper Instructions given pursuant to Section 5.1 above, of any amount paid by Custodian to the account of the Fund or such agent in accordance with such Proper Instructions. ARTICLE VI SEGREGATED ACCOUNTS ------------------- Upon receipt of Proper Instructions, Custodian shall establish and maintain a segregated account or accounts for and on behalf of the Fund, into which account or accounts may be transferred cash and/or Securities, including Securities maintained in a Depository Account: (a) in accordance with the provisions of any agreement among the Company on behalf of the Fund, Custodian and a broker-dealer (or any futures commission merchant), relating to compliance with the rules of The Options Clearing Corporation or of any registered national securities exchange (or the Commodity Futures Trading Commission or any registered contract market), or of any similar organization or organizations, regarding escrow or other arrangements in connection with transactions by the Fund, -25- 25 (b) for purposes of segregating cash or Securities in connection with securities options purchased or written by the Fund or in connection with financial futures contracts (or options thereon) purchased or sold by the Fund, (c) which constitute collateral for loans of Securities made by the Fund, (d) for purposes of compliance by the Fund with requirements under the 1940 Act for the maintenance of segregated accounts by registered investment companies in connection with reverse repurchase agreements, when-issued, delayed delivery and firm commitment transactions, and short sales of securities, and (e) for other proper purposes, but only upon receipt of, in addition to Proper Instructions, a copy of a resolution of the Board of Directors, certified by an Officer, setting forth the purpose or purposes of such segregated account and declaring such purposes to be proper purposes of the Fund. ARTICLE VII SECURITIES LENDING TRANSACTIONS ------------------------------- 7.1 TRANSACTIONS. If and to the extent that the necessary funds and ------------ Securities have been entrusted to it under this Agreement (and unless the Fund gives it Proper Instructions to do otherwise), Custodian from time to time shall make for the account of the Fund the transfers of funds and deliveries of Securities which the Fund is required to make pursuant to the Securities Loan Agreement and shall receive for the account of the Fund the transfers of funds and deliveries of Securities -26- 26 which the borrower under the Securities Loan Agreement is required to make pursuant thereto. Custodian shall make and receive all such transfers and deliveries pursuant to, and subject to the terms and conditions of, the Securities Loan Agreement. 7.2 Collateral; Events of Default. Custodian shall daily mark to market, ----------------------------- in the manner provided for in the Securities Loan Agreement, all loans of Securities which may from time to time be outstanding thereunder. Custodian shall promptly notify the Fund of any Default under the Securities Loan Agreement (as such term "Default" is defined therein) of which it has actual knowledge. 7.3 Securities Loan Agreement. Custodian hereby acknowledges its receipt ------------------------- from the Company on behalf of the Fund of a copy of the Securities Loan Agreement. The Fund shall provide Custodian, prior to the effectiveness thereof, with a copy of any amendment to the Securities Loan Agreement. ARTICLE VIII REPURCHASE TRANSACTIONS ----------------------- 8.1 Transactions. If and to the extent that the funds and Securities have ------------ been entrusted to it under this Agreement (and unless the Fund gives it Proper Instructions to do otherwise), Custodian from time to time shall make for the account of the Fund the transfers of funds and deliveries of Securities which the Fund is required to make pursuant to the Master Repurchase Agreement and shall receive for the account of the Fund the transfers of funds and deliveries of Securities which the seller -27- 27 under the Master Repurchase Agreement is required to make pursuant thereto. Custodian shall make and receive all such transfers and deliveries pursuant to, and subject to the terms and conditions of, the Master Repurchase Agreement. 8.2 Collateral; Events of Default. Custodian shall daily mark to market ----------------------------- the Securities purchased by the Fund under the Master Repurchase Agreement and held in the Custody Account, and shall give to the seller thereunder any such notice as may be required by the Master Repurchase Agreement in connection with such mark-to-market. Custodian shall promptly notify the Fund of any Event of Default by the seller under the Master Repurchase Agreement (as such term "Event of Default" is defined therein) of which it has actual knowledge. 8.3 Master Repurchase Agreement. Custodian hereby acknowledges its --------------------------- receipt from the Company on behalf of the Fund of a copy of the Master Repurchase Agreement. The Fund shall provide Custodian, prior to the effectiveness thereof, with a copy of any amendment to the Master Repurchase Agreement. ARTICLE IX CONCERNING THE CUSTODIAN ------------------------ 9.1 Standard of Care. Custodian shall be held to the exercise of ---------------- reasonable care in carrying out its obligations under this Agreement, and shall be without liability to the Fund for any loss, damage, cost, expense (including attorneys' fees and disbursements), liability or claim which does not arise from willful misfeasance, bad faith or negligence on the part of -28- 28 Custodian or reckless disregard by Custodian of its obligations under this Agreement. Custodian shall be entitled to rely on and may act upon advice of counsel on all matters, and shall be without liability for any action reasonably taken or omitted pursuant to such advice. In no event shall Custodian be liable for special or consequential damages or be liable in any manner whatsoever for any action taken or omitted upon instructions from the Fund or any agent of the Company on behalf of the Fund. Custodian shall not be under any obligation at any time to ascertain whether the Fund is in compliance with the 1940 Act, the regulations thereunder, the provisions of its charter documents or by-laws, or its investment objectives, policies and limitations as in effect from time to time. 9.2 Actual Collection Required. Custodian shall not be liable for, or -------------------------- considered to be the custodian of, any cash belonging to the Fund or any money represented by a check, draft or other instrument for the payment of money, until Custodian or its agents actually receive such cash or collect on such instrument. 9.3 No Responsibility for Title, etc. So long as and to the extent that --------------------------------- it is in the exercise of reasonable care, Custodian shall not be responsible for the title, validity or genuineness of any property or evidence of title thereto received or delivered by it or its agents. 9.4 Limitation on Duty to Collect. Custodian shall promptly notify the ----------------------------- Fund whenever any money or property due and -29- 29 payable from or on account of any Securities held hereunder for the Fund is not timely received by it. Custodian shall not, however, be required to enforce collection, by legal means or otherwise, of any such money or other property not paid when due, but shall receive the proceeds of such collections as may be effected by it or its agents in the ordinary course of Custodian's custody and safekeeping business or of the custody and safekeeping business of such agents. 9.5 Express Duties Only. Custodian shall have no duties or obligations ------------------- whatsoever except such duties and obligations as are specifically set forth in this Agreement, and no covenant or obligation shall be implied in this Agreement against Custodian. Custodian shall have no discretion whatsoever with respect to the management, disposition or investment of the Custody Account and is not a fiduciary to the Fund. 9.6 Compliance with Laws. Custodian undertakes to comply with all -------------------- applicable requirements of the Securities Act of 1933, the Securities Exchange Act of 1934, the 1940 Act and the Commodities Exchange Act and any laws, rules and regulations of governmental authorities having jurisdiction with respect to the duties to be performed by Custodian hereunder. Except as specifically set forth herein, Custodian assumes no responsibility for such compliance by the Fund. 30 ARTICLE X INDEMNIFICATION --------------- 10.1 Indemnification. The Fund shall indemnify and hold harmless --------------- Custodian, any sub-custodian and any nominee of Custodian or any sub-custodian, from and against any loss, damages, cost, expense (including attorneys' fees and disbursements), liability (including, without limitation, liability arising under the Securities Act of 1933, the 1934 Act, the 1940 Act, and any federal or state securities and/or banking laws) or claim arising directly or indirectly (a) from the fact that Securities are registered in the name of any such nominee, or (b) from any action or inaction by Custodian or such sub-custodian or other agent (i) at the request or direction of or in reliance on the advice of the Fund or any of its agents, or (ii) upon Proper Instructions, or (c) generally, from the performance of its obligations under this Agreement, provided that Custodian, any sub-custodian or any nominee of either of them shall not be indemnified and held harmless from and against any such loss, damage, cost, expense, liability or claim arising from Custodian's willful misfeasance, bad faith, negligence or reckless disregard of its obligations under this Agreement or, in the case of any sub-custodian or its nominee, from such sub-custodian's willful misfeasance, bad faith, negligence or reckless disregard of its obligations under the Agreement under which it is acting. -31- 10.2 Indemnity to be provided. If the Fund requests Custodian to ------------------------ take any action with respect to Securities, which may, in the opinion of Custodian, result in Custodian or its nominee becoming liable for the payment of money or incurring liability of some other form, Custodian shall not be required to take such action until the Fund shall have provided indemnity therefor to Custodian in an amount and form satisfactory to Custodian. 10.3 Security. As security for the payment of any present or future -------- obligation or liability of any kind which the Fund may have to Custodian with respect to or in connection with the Custody Account or this Agreement, or which the Fund may otherwise have to Custodian, the Fund hereby pledges to Custodian all cash, Securities and other property of every kind which is in the Custody Account or otherwise held for the Fund pursuant to this Agreement, and hereby grants to Custodian a lien, right of set-off and continuing security interest in such cash, Securities and other property. 10.4 Limitation. Notwithstanding any other provision of this ---------- Agreement, the obligations and liabilities of the Company on behalf of the Fund under this Agreement are solely those of the Fund, and neither the Company generally nor any of its other investment portfolios shall be responsible for any of such obligations or liabilities. -32- ARTICLE XI FORCE MAJEURE ------------- Neither Custodian nor the Fund shall be liable for any failure or delay in performance of its obligations under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including, without limitation, acts of God; earthquakes; fires; floods; wars; civil or military disturbances; sabotage; strikes; epidemics; riots; power failures; computer failure and any such circumstances beyond its reasonable control as may cause interruption, loss or malfunction of utility, transportation, computer (hardware or software) or telephone communication service; accidents; labor disputes; acts of civil or military authority; governmental actions; or inability to obtain labor, material, equipment or transportation. ARTICLE XII REPRESENTATIONS AND WARRANTIES ------------------------------ Each of the Company on behalf of the Fund and Custodian represents and warrants for itself that (a) it has all necessary power and authority to perform its obligations hereunder, (b) the execution and delivery by it of this Agreement, and the performance by it of its obligations under this Agreement, have been duly authorized by all necessary action and will not violate any law, regulation, charter, by-law, or other instrument, restriction or provision applicable to it or by which it is bound, and (c) this Agreement constitutes a legal, valid and -33- binding obligation of it, enforceable against it in accordance with its terms. ARTICLE XIII COMPENSATION OF CUSTODIAN ------------------------- The Fund shall pay Custodian such fees and charges as are set forth in the fee schedule annexed hereto as Exhibit C, as such fee schedule may from time to time be revised by Custodian upon 14 days' prior written notice to the Fund. Any annual fee or other charges payable by the Fund shall be paid monthly by automatic deduction from the Custody Account. Expenses incurred by Custodian in the performance of its services hereunder, and all other proper charges and disbursements of the Custody Account, shall be charged to the Custody Account by Custodian and paid therefrom. ARTICLE XIV TAXES ----- Any and all taxes, including any interest and penalties with respect thereto, which may be levied or assessed under present or future laws or in respect of the Custody Account or any income thereof shall be charged to the Custody Account by Custodian and paid therefrom. ARTICLE XV AUTHORIZED PERSONS ------------------ 15.1 AUTHORIZED PERSONS. Custodian may rely upon and act in ------------------ accordance with any notice, confirmation, instruction or other communication received by it from the Fund which is reasonably -34- believed by Custodian to have been given or signed on behalf of the Fund by any two of the Authorized Persons (one in the case of Oral Instructions) designated by the Fund in Exhibit A hereto, as it may from time to time be revised. The Fund may revise Exhibit A hereto at any time by notice in writing to Custodian given in accordance with Article XVI below, but no revision of Exhibit A hereto shall be effective until Custodian actually receives such notice. 15.2 Investment advisers. Custodian may also act in accordance with ------------------- any Written or Oral Instructions which are reasonably believed by Custodian to have been given or signed by any two of the Authorized Persons (one in the case of Oral Instructions) designated by any of the investment advisers of the Fund specified in Exhibit B hereto (if any) as it may from time to time be revised. The Fund may reverse Exhibit B hereto at any time by notice in writing to Custodian given in accordance with Article XVI below, and each investment adviser specified in Exhibit B hereto (if any) may at any time by like notice designate an Authorized Person or remove an Authorized Person previously designated by it, but no revision of Exhibit B hereto (if any) and no designation or removal by such investment adviser shall be effective until Custodian actually receives such notice. 15.3 Oral instructions. Custodian may rely upon and act in ----------------- accordance with Oral Instructions. If Written Instructions confirming Oral Instructions are not received by Custodian prior to a transaction, it shall in no way affect the validity of the -35- transaction authorized by such Oral Instructions or the authorization of the Fund to effect such transaction. Custodian shall incur no liability to the Fund in acting upon Oral Instructions. To the extent such Oral Instructions vary from any confirming Written Instructions, Custodian shall advise the Fund of such variance but unless confirming Written Instructions are timely received, such Oral Instructions will govern. Either Custodian or Fund may electronically record any instructions given by telephone and any other telephone discussions with respect to the Custody Account. ARTICLE XVI NOTICES ------- Unless otherwise specified herein, all demands, notices, instructions, and other communications to be given hereunder shall be sent, delivered or given to the recipient at the address set forth after its name hereinbelow: If to the Fund: n/i LARGER CAP VALUE FUND THE RBB FUND Bellevue Park Corporate Center 400 Bellevue Parkway (Ste 100) Wilmington, DE 19809 Attention: Charles D. Curtis, Jr. ---------------------- Telephone: (302) 791-1791 Facsimile: (302) 791-3067 If to Custodian: CUSTODIAL TRUST COMPANY 101 Carnegie Center Princeton, New Jersey 08540-6231 Attention: Vice President - Trust Operations --------------------------------- Telephone: (609) 951-2320 Facsimile: (609) 951-2327 -36- or at such other address as either party shall have provided to the other by notice given in accordance with this Article XVI. Writing shall include transmissions by or through teletype, facsimile, central processing unit connection, on-line terminal and magnetic tape. ARTICLE XVII TERMINATION ----------- Either party hereto may terminate this Agreement by giving to the other party a notice in writing specifying the date of such termination, which shall be not less than sixty (60) days after the date of the giving of such notice. Upon the date set forth in such notice this Agreement shall terminate, and Custodian shall, upon receipt of a notice of acceptance by the successor custodian, on that date (a) deliver directly to the successor custodian or its agents all Securities (other than Securities held in a Book-Entry System or Securities Depository) and cash then owned by the Fund and held by Custodian as custodian, and (b) transfer any Securities held in a Book-Entry System or Securities Depository to an account of or for the benefit of the Fund, provided that the Fund shall have paid to Custodian all fees, expenses and other amounts to the payment or reimbursement of which it shall then be entitled. -37- ARTICLE XVIII MISCELLANEOUS ------------- 18.1 Business days. Nothing contained in this Agreement shall ------------- require Custodian to perform any function or duties on a day other than a Business Day. 18.2 Governing law. This Agreement shall be governed by and ------------- construed in accordance with the laws of the State of New York, without regard to the conflict of law principles thereof. 18.3 References to custodian. The Fund shall not circulate any ----------------------- printed matter which contains any reference to Custodian without the prior written approval of Custodian, excepting printed matter contained in the prospectus or statement of additional information for the Fund and such other printed matter as merely identifies Custodian as custodian for the Fund. The Fund shall submit printed matter requiring approval to Custodian in draft form, allowing sufficient time for review by Custodian and its counsel prior to any deadline for printing. 18.4 No waiver. No failure by either party hereto to exercise, and --------- no delay by such party in exercising, any right hereunder shall operate as a waiver thereof. The exercise by either party hereto of any right hereunder shall not preclude the exercise of any other right, and the remedies provided herein are cumulative and not exclusive of any remedies provided at law or in equity. 18.5 Amendments. This Agreement cannot be changed orally and no ---------- amendment to this Agreement shall be effective unless -38- evidenced by an instrument in writing executed by the parties hereto. 18.6 Counterparts. This Agreement may be executed in one or more ------------ counterparts, and by the parties hereto on separate counterparts, each of which shall be deemed an original but all of which together shall constitute but one and the same instrument. 18.7 Severability. If any provision of this Agreement shall be ------------ invalid, illegal or unenforceable in any respect under any applicable law, the validity, legality and enforceability of the remaining provisions shall not be affected or impaired thereby. 18.8 Successors and assigns. This Agreement shall be binding upon ---------------------- and shall inure to the benefit of the parties hereto and their respective successors and assigns; provided, however, that this Agreement shall not be -------- ------- assignable by either party hereto without the written consent of the other party. Any purported assignment in violation of this Section 18.8 shall be void. 18.9 Jurisdiction. Any suit, action or proceeding with respect to ------------ this Agreement may be brought in the Supreme Court of the State of New York, County of New York, or in the United States District Court for the Southern District of New York, and the parties hereto hereby submit to the non-exclusive jurisdiction of such courts for the purpose of any such suit, action or proceeding, and hereby waive for such purpose any other -39- preferential jurisdiction by reason of their present or future domicile or otherwise. 18.10 Headings. The headings of sections in this Agreement are for -------- convenience of reference only and shall not affect the meaning or construction of any provision of this Agreement. IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed in its name and on its behalf by its representative thereunto duly authorized, all as of the day and year first above written. THE RBB FUND, INC. WITH RESPECT TO AND ON BEHALF OF n/i LARGER CAP VALUE FUND By: -------------------------------- Name: Edward J. Roach Title: President and Treasurer CUSTODIAL TRUST COMPANY By: -------------------------------- Name: Ronald D. Watson Title: President -40- EXHIBIT A --------- AUTHORIZED PERSONS Set forth below are the names and specimen signatures of the persons authorized by n/i LARGER CAP VALUE FUND to administer the Custody Account. NAME SIGNATURE ---- --------- - --------------------------- ----------------------------- - --------------------------- ----------------------------- - --------------------------- ----------------------------- - --------------------------- ----------------------------- -41- EXHIBIT B --------- INVESTMENT ADVISERS Numeric Investors L.P. -42- EXHIBIT C --------- CUSTODY FEES AND TRANSACTION CHARGES Domestic fees. The Fund shall pay Custodian the following fees for assets maintained in the United States ("Domestic Assets") and charges for transactions in the United States, all such fees and charges to be payable monthly: (1) an annual fee of the greater of 0.015% (one and one-half basis points) per annum of the value of the Domestic Assets in the Custody Account or $5,000, such fee to be based upon the total market value of such Domestic Assets as determined on the last Business Day of the month for which such fee is charged; (2) a transaction charge of $12 for each receive or deliver of book-entry Securities into or from the Custody Account (but not for any such receive or deliver of book-entry Securities loaned by the Portfolio or constituting collateral for a loan of Securities, or any such receive or deliver in a repurchase transaction representing (a) a cash sweep investment for the Fund's account or (b) the investment by the Fund of cash collateral for a loan of Securities); (3) a transaction charge of $25 for each receive or deliver into or from the Custody Account of Securities in physical form; (4) a transaction charge for each repurchase transaction in the Custody Account which represents a cash sweep investment for the Fund's account, computed, on the basis of a 360-day year and for the actual number of days such repurchase transaction is outstanding, at a rate of 0.10% (ten basis points) per annum on -43- the amount of the purchase price paid by the Fund in such repurchase transaction; (5) a charge of $10 for each "free" transfer of funds from the Custody Account; (6) an administrative fee for each purchase in the Custody Account of shares or other interests in a money market or other fund, which purchase represents a cash sweep investment for the Fund's account, computed for each day that there is a positive balance in such fund to equal 1/365th of 0.10% (ten basis points) on the amount of such positive balance for such day; and (7) a service charge for each holding of Securities or other assets sold by way of private placement or in such other manner as to require services by Custodian which in its reasonable judgment are materially in excess of those ordinarily required for the holding of publicly traded Securities in the United States. International Fees. The Fund shall pay Custodian fees for assets ------------------ maintained outside the United States ("Foreign Assets") and charges for transactions outside the United States (including, without limitation, charges for funds transfers and tax reclaims) in accordance with such schedule of fees and charges for each country in which Foreign Assets are held as Custodian shall from time to time provide to the Fund. Any asset-based fee shall be based upon the total market value of the applicable Foreign Assets as determined on the last Business Day of the month for which such fee is charged. -44- EX-99.8Q 8 CUSTODIAL AGREEMENT SUPPLEMENT Exhibit (8)(q) CUSTODIAN AGREEMENT SUPPLEMENT (Boston Partners Bond Fund) This supplemental agreement is entered into this 1st day of December, 1997 by and between THE RBB FUND, INC. (the "Company") and PNC Bank, National Association, (the "Custodian Agent"). The Company is a corporation organized under the laws of the State of Maryland and is an open-end management investment company. The Company and the Custodian have entered into a Custodian Agreement, dated as of August 16, 1988 (as from time to time amended and supplemented, the "Custodian Agreement"), pursuant to which the Custodian has undertaken to act as custodian for the Company with respect to the portfolios of the Fund, as more fully set forth therein. Certain capitalized terms used without definition in this Custodian Agreement Supplement have the meaning specified in the Custodian Agreement. The Fund agrees with the Custodian as follows: 1. Adoption of Custodian Agreement. The Custodian Agreement is hereby ------------------------------- adopted for the Boston Partners Bond Fund. 2. Compensation. As compensation for the services rendered by the ------------ Custodian during the term of the Custodian Agreement, the Fund will pay to the Custodian, with respect to Boston Partners Bond Fund, monthly fees as shall be agreed to from time to time by the Fund and the Custodian. 3. Counterparts. This Agreement may be executed in two or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the undersigned have entered into this Agreement, intending to be legally bound hereby, as of the date and year first above written. THE RBB FUND, INC. PNC BANK, NATIONAL ASSOCIATION By: Edward J. Roach By: /s/ Robert Perlswig ------------------- --------------------- Name: Edward J. Roach Name: Robert Perlswig Title: President and Treasurer Title: Executive Vice President EX-99.9AAA 9 TRANSFER AGENCY AGREEMENT SUPPLEMENT Exhibit (9)(aaa) TRANSFER AGENCY AGREEMENT SUPPLEMENT (n/i Larger Cap Value Fund) This supplemental agreement is entered into this 1st day of December, 1997, by and between THE RBB FUND, INC. (the "Fund") and PFPC Inc., a Delaware corporation (the "Transfer Agent"), which is an indirect, wholly-owned subsidiary of PNC Bank Corp. The Fund is a corporation organized under the laws of the State of Maryland and is an open-end management investment company. The Fund and the Transfer Agent have entered into a Transfer Agency Agreement, dated as of November 5, 1991 (as from time to time amended and supplemented, the "Transfer Agency Agreement"), pursuant to which the Transfer Agent has undertaken to act as transfer agent, registrar and dividend disbursing agent for the Fund with respect to the Shares of the Fund, as more fully set forth therein. Certain capitalized terms used without definition in this Transfer Agency Agreement Supplement have the meaning specified in the Transfer Agency Agreement. The Fund agrees with the Transfer Agent as follows: 1. Adoption of Transfer Agency Agreement. The Transfer Agency ------------------------------------- Agreement is hereby adopted for the n/i Larger Cap Value Fund (the "Fund") Class of Common Stock (Class XX) of the Fund. This shall constitute a "Class" as referred to in the Transfer Agency Agreement and its shares shall be "Shares" as referred to therein. 2. Compensation. As compensation for the services rendered by the ------------ Transfer Agent during the term of the Transfer Agency Agreement, the Fund will pay to the Transfer Agent, with respect to each Class of the Fund, monthly fees that shall be agreed to from time to time by the Fund and the Transfer Agent, for each account open at any time during the month for which payment is being made, plus certain of the Transfer Agent's expenses relating to such services, as shall be agreed to from time to time by the Fund and the Transfer Agent. 3. Counterparts. This agreement may be executed in two or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the undersigned have entered into this Agreement, intending to be legally bound hereby, as of the date and year first above written. THE RBB FUND, INC. PFPC INC. By:/s/ Edward J. Roach By:/s/ Robert Perlswig --------------------- -------------------- President and Treasurer -2- EX-99.9BBB 10 ADMINISTRATION & ACCOUNTING SERVICES AGREEMENT Exhibit 9(bbb) ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT TERMS AND CONDITIONS This Agreement is made as of December 1, 1997 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 PNC Bank Corp. The Fund is registered as an open-end, non-diversified investment company under the Investment Company Act of 1940, as amended (the "1940 Act"). The Fund wishes to retain PFPC, to provide administration and accounting services to its n/i Larger Cap Value Fund (the "Portfolio"), and PFPC wishes to furnish such services. In consideration of the promises and mutual covenants herein contained, the parties agree as follows: 1. Definitions. ----------- (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 and Written Instructions on behalf of the Fund and listed on the Certificate attached hereto as Appendix B or any amendment thereto as may be received by PFPC from time to time. An Authorized Person's scope of authority may be limited by the Fund by setting forth such limitation on the Certificate. (d) "Book-Entry System" means Federal Reserve Treasury book-entry ----------------- system for United States and federal agency securities, its successor or successors, and its nominee or nominees and any book-entry system maintained by an exchange registered with the SEC under the 1934 Act. (e) "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. (f) "SEC" means the Securities and Exchange Commission. --- (g) "Shares" mean the shares of common stock of the Fund representing ------ an interest in the Portfolio. (h) "Property" means: -------- (i) any and all securities and other investment items of the Portfolio which the Fund may from time to time deposit, or cause to be deposited, with PFPC or which PFPC may from time to time hold for the Fund on behalf of the Portfolio; (ii) all income in respect of any of such securities or other investment items; (iii) all proceeds of the sale of any of such securities or investment items; and (iv) all proceeds of the sale of Shares which are received by PFPC from time to time, from or on behalf of the Fund. (i) "Written Instructions" mean written instructions signed by two -------------------- Authorized Persons and received by PFPC. The -2- 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 to provide services pursuant to this Agreement; (b) a copy of the Fund's most recent effective registration statement; (c) a copy of the Fund's advisory agreement or agreements with respect to the Portfolio; (d) a copy of the Fund's distribution agreement or agreements with respect to the Portfolio; (e) a copy of any additional administration agreement with respect to the Portfolio; (f) copies of any shareholder servicing agreements made in respect of the Portfolio; and (g) certified or authenticated copies of any and all amendments or supplements to the foregoing. 4. Compliance with Government Rules and Regulations. PFPC undertakes to ------------------------------------------------ comply with all applicable requirements of the 1933 Act, the 1934 Act and the 1940 Act, and any laws, rules and regulations of governmental authorities having jurisdiction with respect to all duties to be performed by PFPC hereunder. Except -3- as specifically set forth herein, PFPC assumes no responsibility for such compliance by the Fund. 5. Instructions. ------------ Unless otherwise provided in this Agreement, PFPC shall act only upon Oral and Written Instructions. PFPC shall be entitled to rely upon any Oral 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 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. The Fund agrees to forward to PFPC Written Instructions confirming Oral Instructions 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. The Fund further agrees that PFPC shall incur no liability to the Fund in acting upon Oral or Written Instructions provided such instructions reasonably appear to have been received from an Authorized Person. -4- 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 or Written Instructions, from the Fund. (b) Advice of Counsel. If PFPC shall be in doubt as to any questions ----------------- 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 advisor or PFPC, at the option of PFPC). (c) Conflicting Advice. In the event of a conflict between ------------------ directions, advice or Oral or Written Instructions PFPC receives from the Fund, and the advice it receives from counsel, PFPC shall be entitled to rely upon and follow the advice of counsel. (d) Protection of PFPC. PFPC shall be protected in any action it ------------------ takes or does not take in reliance upon directions, advice or Oral 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 or Written Instructions. Nothing in this paragraph shall be construed so as to impose an obligation upon PFPC (i) to seek such directions, advice or Oral or Written Instructions, or (ii) to act in accordance with such directions, advice or Oral or Written Instructions unless, under the terms of other provisions of this -5- Agreement, the same is a condition of PFPC's properly taking or not taking such action. 7. Records. ------- The books and records pertaining to the Fund, which are in the possession 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 to be paid from the assets of the Portfolio. PFPC shall keep the following records: (a) all books and records with respect to the Portfolio's books of account; (b) records of the Portfolio's securities transactions; (c) all other books and records as PFPC is required to maintain pursuant to Rule 31a-1 of the 1940 Act and as specifically set forth in Appendix B hereto. 8. Confidentiality. --------------- PFPC agrees to keep confidential all records of the Fund and information relative to the Fund and its shareholders (past, present and potential), 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. -6- The Fund further agrees that, should PFPC be required to provide such information or records to duly constituted authorities (who may institute civil or criminal contempt proceedings for failure to comply), PFPC shall not be required to seek the Fund's consent prior to disclosing such information. 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, all with respect to the Portfolio. PFPC shall take all reasonable action in the performance of its obligations under this Agreement to assure that the necessary information is made available to such accountants for the expression of their opinion, as such may be required by the Fund from time to time. 10. Disaster Recovery. ----------------- PFPC shall enter into and shall maintain in effect with appropriate parties one or more agreements making reasonable provision of 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 but shall have no liability with respect thereto. -7- 11. Compensation. ------------ As compensation for services rendered by PFPC during the term of this Agreement, the Fund will pay to PFPC from the assets of the Portfolio a fee or fees as may be agreed to in writing by the Fund and PFPC. 12. Indemnification. --------------- The Fund agrees to indemnify and hold harmless PFPC and its nominees from all taxes, charges, expenses, assessments, claims and liabilities (including, without limitation, liabilities arising under the 1933 Act, the 1934 Act and the 1940 Act, and any state and 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 which PFPC takes or does not take (i) at the request or on the direction of or in reliance on the advice of the Fund or (ii) upon Oral or Written Instructions. Neither PFPC, nor any of its nominees, shall be indemnified against any liability to the Fund or to its shareholders (or any expenses incident to such liability) arising out of PFPC's own willful misfeasance, gross negligence or reckless disregard of its duties and obligations under this Agreement. 13. Responsibility of PFPC. ---------------------- PFPC shall be under no duty to take any action on behalf of the Fund 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 -8- its duties hereunder, to act in good faith and to use its best efforts, within reasonable limits, in performing services provided for under this Agreement. PFPC shall be responsible for failure to perform its duties under this Agreement arising out of PFPC's gross negligence. Notwithstanding the foregoing, PFPC shall not be responsible for losses beyond its control, provided that PFPC has acted in accordance with the standard of care set forth above; and provided further that PFPC shall only be responsible for that portion of losses or damages suffered by the fund that are attributable to the gross negligence of PFPC. Without limiting the generality of the foregoing or of any other provision of this Agreement, PFPC, in connection with its duties under this Agreement, shall not be liable for (a) the validity or invalidity or authority or lack thereof of any Oral 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) 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 or catastrophe, acts of God, insurrection, war, riots or failure of the mails, transportation, communication or power supply. Notwithstanding anything in this Agreement to the contrary, PFPC shall have no liability to the Fund for any consequential, special or indirect losses or damages which the Fund may incur or suffer by or as a consequence of PFPC's -9- performance of the services provided hereunder, whether or not the likelihood of such losses or damages was known by PFPC. 14. Description of Accounting Services on a Continuing Basis. -------------------------------------------------- ----- PFPC will perform the following accounting functions with respect to the Portfolio if required: (i) Journalize investment, capital share and income and expense activities; (ii) verify investment buy/sell trade tickets when received from the investment advisor (the "Advisor") and transmit trades to the Fund's foreign 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 with the Custodian, and provide the Advisor with the beginning cash balance available for investment purposes; (vi) Update the cash availability throughout the day as required by the Advisor; (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; -10- (xii) Determine net income; (xiii) Obtain security market quotes from independent pricing services approved by the Advisor, or if such quotes are unavailable, then obtain such prices from Advisor, and in either case calculate the market value of the investments; (xiv) Transmit or mail a copy of the daily portfolio valuation to the Advisor; (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 Cash Statement Schedule of Capital Gains and Losses. 15. Description of Administration Services on a Continuing 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) (a) Assist in the preparation of support schedules necessary for completion of federal and state tax returns; or (b) prepare for execution and file the Fund's Federal and state tax returns; (iv) (a) Assist in the preparation of Semi-Annual Reports with the SEC on Form -11- N-SAR; or (b) prepare and file the Fund's Semi-Annual Reports with the SEC on Form N-SAR. (v) (a) Assist in the preparation of annual, semi-annual, and quarterly shareholder reports; or (b) prepare and file with the SEC the Fund's annual, semi-annual, and quarterly shareholder reports; (vi) Assist with the preparation of registration statements and other filings relating to the registration of Shares; (vii) Monitor the Portfolio's status as a regulated investment company under SubChapter M of the Internal Revenue Code of 1986, as amended; and (viii) Coordinate contractual relationships and communications between the Fund and its service providers. 16. 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. 17. Notices. ------- All notices and other communications, including written Instructions, shall be in writing or by confiding 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 shall be deemed to have been given on the day it is delivered. Notices shall be addressed (a) if to PFPC at PFPC's -12- address, 103 Bellevue Parkway, Wilmington, Delaware 19809; (b) if to the Fund, at the address of the Fund; or (c) if to neither of the foregoing, at such other address as shall have been notified to the sender of any such Notice or other communication. 18. 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. 19. Delegation. ---------- PFPC may assign its rights and delegate its duties hereunder to any wholly owned direct or indirect subsidiary of Provident National Bank or PNC Financial Corp, provided that (i) PFPC gives the Fund thirty (30) days' prior written notice; (ii) the delegate agrees with PFPC to comply with all relevant provisions of the 1940 Act; and (iii) PFPC and such delegate promptly provide such information as the Fund may request, and respond to such questions as the Fund may ask, relative to the delegation, including (without limitation) the capabilities of the delegate. 20. 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. -13- 21. Further Actions. --------------- Each party agrees to perform such further acts and execute such further documents as are necessary to effectuate the purposes hereof. 22. Miscellaneous. ------------- 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 and/or 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. This Agreement shall be deemed to be a contract made in Delaware and governed by Delaware law. If any provision of this Agreement shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of this Agreement shall -14- not be affected thereby. This Agreement shall be binding and shall inure to the benefit of the parties hereto and their respective successors. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their officers designated below on the day and year first above written. PFPC INC. By: /s/ Stephen Wynne ---------------------------------- Executive Vice President THE RBB FUND, INC. By: /s/ Edward J. Roach ---------------------------------- President and Treasurer -15- APPENDIX A ---------- [List Books and Records to be ----------------------------- Maintained by PFPC] ------------------- -16- APPENDIX B ---------- Authorized Persons - ------------------------------------ ---------------------------------- (name) (signature) - ------------------------------------ ---------------------------------- (name) (signature) - ------------------------------------ ---------------------------------- (name) (signature) - ------------------------------------ ---------------------------------- (name) (signature) - ------------------------------------ ---------------------------------- (name) (signature) - ------------------------------------ ---------------------------------- (name) (signature) -17- EX-99.9CCC 11 CO-ADMINISTRATION AGREEMENT Exhibit (9)(ccc) CO-ADMINISTRATION AGREEMENT CO-ADMINISTRATION AGREEMENT, made as of the 1st day of December, 1997 between The Numeric Family of The RBB Fund, Inc., a Maryland corporation (the "Fund") and Bear Stearns Funds Management Inc., a New York corporation (the "Co- Administrator"). WITNESSETH: ----------- WHEREAS, the Fund, consisting of the series named on Schedule 1, hereto, as such Schedule may be revised from time to time (each a "Series"), is a diversified open-end management investment company registered under the Investment Company Act of 1940, as amended (the "Investment Company Act"); and WHEREAS, the Fund has retained an investment adviser for the purpose of investing its assets in securities and desires to retain the Co-Administrator for certain administrative services, and the Co-Administrator is willing to furnish such administrative services on the terms and conditions hereinafter set forth; NOW, THEREFORE, the parties hereto agree as follows: 1. Appointment. The Fund hereby appoints the Co-Administrator to provide ----------- the services set forth below, subject to the overall super-vision of the Board of Directors of the Fund (the "Board") for the period and on the terms set forth in this Agreement. The Co-Administrator hereby accepts such appointment and agrees during such period to render the services herein described and to assume the obligations herein set forth; for the compensation herein provided. 2. Description of Services. Subject to the supervision of the Board and ----------------------- the officers of the Fund, the Co-Administrator shall provide office facilities and personnel to assist the officers of the Fund in the performance of the following services: (a) Review of all materials filed with the Securities and Exchange Commission ("SEC") on behalf of the Fund (e.g., N-SAR, amendments to registration statements on Form N-IA, periodic reports to shareholders, proxy statements, etc.) and monitor EDGAR filing of the same; (b) Assist in the negotiation of fees for services rendered to the Series; (c) Assist both the Adviser and the Series in the preparation of materials for periodic Board meetings and committees thereof; -2- (d) Oversee the determination and publication of each Series' net asset value in accordance with each Series' policy as adopted from time to time by the Board; (e) Oversee the maintenance by PFPC Inc. of certain books and records of each Series as required under the Investment Company Act of 1940, as amended (the "Investment Company Act"), and maintain (or oversee the maintenance by such other persons as approved by the Board) such other books and records (other than those maintained by the investment adviser) required by law or for the proper operation of each Series; (f) Assist in the preparation and review of each Series' federal, state and local income tax returns and any other required tax return (other than those filings relating to a shareholder's holdings in each Series, which will be handled by PFPC Inc., in the capacity of transfer agent); (g) Assist in the preparation and review of year-end shareholder tax notifications for dividends and distributions paid by each Series during the calendar and/or fiscal year; (h) Assist with the preparation, review and approval by officers of the Fund and the Adviser, the financial information for each Series' semi- annual, annual and other periodic reports, proxy statements and other communications with shareholders or -3- otherwise to be sent to each Series' shareholders, and coordinate for the printing and dissemination of such reports and communications to shareholders; (i) Assist with the preparation and dissemination of statistical information and research data to outside reporting agencies; (j) Prepare and/or assist with the preparation of reports relating to the business and affairs of the Fund as may be mutually agreed upon and not otherwise appropriately prepared by the Fund Adviser, custodian, Co- Administrator and accounting agent, transfer agent, legal counsel or independent accountants; (k) Consult with the Fund's officers, independent accountants, legal counsel, custodian, Co-Administrator and accounting agent, and transfer and dividend disbursing agent in establishing the accounting policies of each Series; (l) Review and assist with the computation of the amount of dividends and distributions to be paid by each Series; (m) Provide communication and coordination services with regard to the Fund's investment adviser, transfer and disbursing agent, custodian and other service providers that render recordkeeping or shareholder communication services to the Fund; and (n) Develop and implement procedures to assist the Adviser in monitoring, on a monthly basis, the Series' compliance with regulatory requirements, specifically compliance with the Fund's prospectus, diversification and other requirements under the Investment Company Act, and each Series' income diversification requirements under Subchapter -4- of the Internal Revenue Code of 1986, as amended. All services are to be furnished through the medium of any directors, officers or employees of the Co-Administrator as the Co-Administrator deems appropriate in order to fulfill its obligations hereunder. Each party shall bear all its own expenses incurred in connection with this Agreement, except as noted below. 3. Compensation. The Fund will pay the Co-Administrator a monthly fee ------------ calculated at the annual rate of 0.05% of the first $150 million of each Series' average daily net assets and 0.02% on all assets above $150 million of each Series' average daily net assets. Average daily net assets are based on the net asset value on each day the New York Stock Exchange is open for business. In addition to the fee, the Fund, on behalf of each Series, may be required to reimburse to the Co-Administrator all out-of-pocket expenses incurred by the Co- Administrator for attendance at any meeting (outside of the New York metropolitan area) of the Board, or any committees of such Board, or at any other meetings or presentations for which the Co-Administrator is required to attend. -5- 4. Responsibility of the Co-Administrator. The Co-Administrator assumes -------------------------------------- no responsibility under this Agreement other than to render the services called for hereunder, and specifically assumes no responsibilities for investment advice or the investment or reinvestment of the Fund's assets. 5. Indemnification. The Co-Administrator shall not be liable to the Fund --------------- for any action taken or omitted to be taken by the Co-Administrator in connection with the performance of any of its duties or obligations under this Agreement, and the Fund shall indemnify the Co-Administrator and hold it harmless from and against all damages, liabilities, costs and expenses (including reasonable attorneys' fees and amounts reasonably paid in settlement) incurred by the Co-Administrator in or by reason of any pending, threatened or completed action, suit, investigation or other proceeding (including an action or suit by or in the right of the Fund or its security shareholders) arising out of or otherwise based upon any action actually or allegedly taken or omitted to be taken by the Co-Administrator in connection with the performance of any of its duties or obligations under this Agreement; provided, however, that nothing contained herein shall protect or be deemed to protect the Co-Administrator against or entitle or be deemed to entitle the Co-Administrator to indemnification in respect of any liability to the Fund or its security holders to which the Co-Administrator would otherwise be subject by reason of willful misfeasance, bad faith or gross negligence in the performance of its duties, or by reason of its reckless disregard of its duties and obligations under this Agreement. -6- 6. Duration and Termination. This Agreement shall become effective as of ------------------------ the date hereof and shall thereafter continue in effect unless terminated as herein provided. This Agreement may be terminated by either party hereto (without penalty) at any time by giving not less than 60 days' prior written notice to the other party hereto. 7. Services to Others. The services of the Co-Administrator to the Fund ------------------ hereunder are not exclusive and nothing in this Agreement shall limit or restrict the right of the Co-Administrator to engage in any other business or to render services of any kind to any other corporation, firm, individual or association. The Co-Administrator shall be deemed to be an independent contractor, unless otherwise expressly provided or authorized by this Agreement. 8. References to the Co-Administrator. During the term of this ---------------------------------- Agreement, the Fund agrees to furnish the Co-Administrator at the principal office of the Co-Administrator prior to use thereof all prospectuses, proxy statements, reports to shareholders, sales literature, or other material prepared for distribution to shareholders of the Fund or the public that refer in any way to the Co-Administrator. If the Co-Administrator reasonably objects in writing to such references within five business days (or such other time as may be mutually agreed) after receipt thereof, the Fund will modify such references in a manner reasonably satisfactory to the Co-Administrator. In the event of termination of this Agreement, the Fund will continue to furnish to the Co-Administrator copies of any of the above-mentioned materials that refer in any way to the Co-Administrator and, as soon as -7- practicable after such termination, shall eliminate all references to the Co- Administrator in all written materials used thereafter. The Fund shall furnish or otherwise make available to the Co-Administrator such other information relating to the business affairs of the Fund as the Co-Administrator at any time, or from time to time, reasonably requests in order to discharge its obligations hereunder. 9. Amendments. This Agreement may be amended only by mutual written ---------- consent. 10. Notices. Any notice or other communication required to be given ------- pursuant to this Agreement shall be deemed duly given if delivered or mailed by registered mail, postage prepaid, (1) to the Co-Administrator at 245 Park Avenue, 15th floor, New York, New York 10167, Attention: Frank J. Maresca, Executive Vice President or (2) to the Fund at 400 Bellevue Parkway, Wilmington, DE 19809, Attention: Edward Roach, President. 11. Entire Agreement. This Agreement sets forth the entire agreement and ---------------- understanding of the parties hereto solely with respect to the matters covered hereby and the relationship between the Fund and Bear Stearns Funds Management Inc. as Co-Administrator. The Co-Administrator Agreement by and between the Fund and the Co-Administrator dated as of May 31, 1996 is hereby terminated and shall have no further force or effect as of the date hereof. Nothing in this Agreement shall govern, restrict or limit in any respect any other business dealings between the parties hereto unless otherwise expressly provided herein. -8- 12. Governing Law. This Agreement shall be governed by and construed in ------------- accordance with the laws of the State of New York without reference to choice of law principles thereof and in accordance with the Investment Company Act. In the case of any conflict the Investment Company Act shall control. IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed by their officers designated below as of the day and year first above written. THE NUMERIC FAMILY of THE RBB FUND, INC. By: /s/ Edward J. Roach -------------------------- Name: Eadward J. Roach Title: President and Treasurer BEAR STEARNS FUNDS MANAGEMENT INC. By: /s/ Frank J. Maresca -------------------------- Name: Frank J. Maresca Title: Executive Vice President -9- Schedule I The Numeric Family ------------------ n/i Micro Cap Fund n/i Growth Fund n/i Growth & Value Fund n/i Larger Cap Fund EX-99.9DDD 12 ADMINISTRATIVE SERVICES AGREEMENT Exhibit 9(ddd) ADMINISTRATIVE SERVICES AGREEMENT --------------------------------- This Agreement is made as of the 1st day of December, 1997, by and between THE RBB FUND, INC., a Maryland corporation (the "Fund"), on behalf of its n/i Larger Cap Value Fund ( the "Portfolio") and COUNSELLORS FUNDS SERVICE, INC. ("Counsellors"), a Delaware corporation. W I T N E S S E T H WHEREAS, the Fund is registered as an open-end, diversified management investment company under the Investment Company Act of 1940, as amended (the "1940 Act"); and WHEREAS, the Fund wishes to retain Counsellors to provide certain administrative services to the Portfolio, and Counsellors is willing to furnish such services; NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, it is agreed between the parties hereto as follows: 1. Appointment. The Fund hereby appoints Counsellors to provide certain ----------- administrative services to the Portfolio for the period and on the terms set forth in this Agreement. Counsellors accepts such appointment and agrees to furnish the services herein set forth in return for the compensation as provided in Paragraph 6 of this Agreement. Counsellors agrees to comply with all relevant provisions of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and 1940 Act and applicable rules and regulations thereunder. 2. Services on a Continuing Basis. Subject to the supervision and ------------------------------ direction of the Board of Directors of the Fund, Counsellors undertakes to perform the following administrative services for the Portfolio: (a) Making available office facilities, as requested by the Fund, (which may be in the offices of Counsellors or a corporate affiliate); (b) Furnishing data processing services, clerical services and certain internal quasi-legal, executive and administrative services; (c) Furnish an 800 telephone line for shareholder inquires and otherwise assist in the preparation of shareholder communications and notices as requested by the Fund or the investment adviser to the Portfolio (the "Investment Adviser"). (d) Assisting in coordinating the preparation of reports to the Portfolio's shareholders of record and the Securities and Exchange Commission (the "SEC") including, but not limited to, proxy statements; annual, semi-annual and quarterly reports to Shareholders; annual and semi-annual reports on Form N-SAR; and post-effective amendments to the Fund's Registration Statement on Form N-1A (the "Registration Statement"); (e) Assisting the Investment Adviser, at the Investment Adviser's request, in monitoring and developing compliance procedures which will include, among other matters, -2- procedures to assist the Investment Adviser in monitoring compliance with the Portfolio's investment objective, policies, restrictions, tax matters and applicable laws and regulations; and (f) Acting as liaison between the Fund and the Fund's independent public accountants, counsel, custodian or custodians, transfer agent and administrator and taking all reasonable action in the performance of its obligations under this Agreement to assure that all necessary information is made available to each of them. In performing all services under this Agreement, Counsellors shall act in conformity with applicable law, the Fund's Articles of Incorporation and By- Laws, and all amendments thereto, and the Portfolio's investment objective, investment policies and other practices and policies set forth in the Fund's Registration Statement, as such Registration Statement and practices and policies may be amended from time to time. 3. Books and Records. In connection with the services provided under this ----------------- Agreement, Counsellors shall maintain such books and records, as required by the Fund, of the Fund's reports or filings with the Portfolio's shareholders, the SEC authorities and other required reports and documents prepared, filed or distributed on behalf of the Fund. The books and records pertaining to the Fund or any Portfolio that are in the possession of Counsellors shall be the property of the Fund. Such books and records shall be prepared -3- and maintained as required by the 1940 Act and other applicable securities laws and rules and regulations. The Fund, or the Fund's authorized representatives, shall have access to such books and records at all times during Counsellors' normal business hours. Upon the reasonable request of the Fund, copies of any such books and records shall be provided by Counsellors to the Fund or the Fund's authorized representative at the Fund's expense. 4. Confidentiality. Counsellors agrees on behalf of itself and its --------------- employees to treat confidentially all records and other information relative to the Fund or any Portfolio and its prior, present or potential shareholders and relative to the Investment Adviser and its prior, present or potential customers, except, after prior notification to and approval in writing by the Fund, which approval shall not be unreasonably withheld and may not be withheld where Counsellors may be exposed to civil or criminal contempt proceedings for failure to comply, when requested to divulge such information by duly constituted authorities, or when so requested by the Fund. 5. Right to Receive Advice. ----------------------- (a) Advice of Fund. If Counsellors is in doubt as to any action to be -------------- taken or omitted by it, it may request, and shall receive, directions or advice from the Fund. (b) Advice of Counsel. If Counsellors is in doubt as to any question ----------------- of law involved in any action to be taken or omitted by Counsellors, it may request advice at its own cost -4- from counsel of its own choosing (who may be counsel for the Investment Adviser, the Fund or Counsellors, at the option of Counsellors). (c) Conflicting Advice. In case of conflict between directions or advice received by Counsellors pursuant to subsection (a) of this paragraph and advice received by Counsellors pursuant to subsection (b) of this paragraph, Counsellors shall be entitled to rely on and follow the advice received pursuant to the latter provision alone. (d) Protection of Counsellors. Counsellors shall be protected in any ------------------------- action or inaction which it takes in reliance on any directions or advice received pursuant to subsections (a) or (b) of this paragraph which Counsellors, after receipt of any such directions or advice in good faith believes to be consistent with such directions or advice. However, nothing in this paragraph shall be construed as imposing upon Counsellors any obligation (i) to seek such directions or advice or (ii) to act in accordance with such directions or advice when received. Nothing in this subsection shall excuse Counsellors when an action or omission on the part of Counsellors constitutes willful misfeasance, bad faith, negligence or reckless disregard by Counsellors of its duties under this Agreement. 6. Compensation. In consideration of services rendered pursuant to this ------------ Agreement, the Fund will pay Counsellors on the first business day of each month a fee for the previous month, calculated daily. The Fund will also reimburse Counsellors for -5- its out-of-pocket expenses incurred on behalf of the Fund, including but not limited to, postage, telephone, telex and Federal Express charges. The annual fee shall be .15% of the Portfolio's average daily net assets exclusive of out- of-pocket expenses. Upon any termination of this Agreement before the end of any month, the fee for such part of a month shall be prorated according to the proportion which such period bears to the full monthly period and shall be payable upon the date of termination of this Agreement. For the purpose of determining fees payable to Counsellors, the value of the Portfolio's net assets shall be computed at the times and in the manner specified in the Fund's Prospectus and Statement of Additional Information as from time to time in effect. The annual fee paid to Counsellors hereunder may be amended upon terms as may be specifically agreed to in writing from time to time by the Fund and Counsellors. 7. Indemnification. The Fund agrees to indemnify and hold harmless --------------- Counsellors and its nominees from all taxes, charges, expenses, assessments, claims and liabilities (including, without limitation, liabilities arising under federal securities and commodities laws and any state and foreign securities and Blue Sky laws, all as or to be amended from time to time) and expenses, including (without limitation) attorneys' fees and disbursements, arising directly or indirectly from any action or thing which Counsellors takes or does or omits to take or do pursuant to the terms of this Agreement or otherwise at the request or on the direction of or in reliance on the advice of -6- the Fund, provided, that neither Counsellors nor any of its nominees shall be indemnified against any liability to the Fund or to its Shareholders (or any expenses incident to such liability) arising out of Counsellors' own willful misfeasance, bad faith, negligence or reckless disregard of its duties and obligations under this Agreement. 8. Responsibility of Counsellors. Counsellors shall be under no duty to ----------------------------- take any action on behalf of the Fund, except as specifically set forth herein or as may be specifically agreed to by Counsellors in writing. In the performance of its duties hereunder, Counsellors shall be obligated to exercise care and diligence and to act in good faith and to use its best efforts within reasonable limits in performing services provided for under this Agreement. Counsellors shall be responsible for its own negligent failure to perform its duties under this Agreement. Without limiting the generality of the foregoing or of any other provision of this Agreement, Counsellors in connection with its duties under this Agreement shall not be under any duty or obligation to inquire into and shall not be liable for or in respect of (a) the validity or invalidity or authority or lack thereof of any notice or other instrument which conforms to the applicable requirements of this Agreement, and which Counsellors reasonably believes to be genuine; or (b) delays or errors or loss of data occurring by reason of circumstances beyond Counsellors' control, including acts of civil or military -7- authority, national emergencies, labor difficulties, fire, mechanical breakdown, flood or catastrophe, acts of God, insurrection, war, riots or failure of the mails, transportation, communication or power supply. 9. Duration and Termination. This Agreement shall continue until ------------------------ terminated by the Fund or Counsellors on 60 days' written notice. 10. Notices. All notices and other communications hereunder (collectively ------- referred to as "Notice" or "Notices" in this Paragraph), shall be in writing or by confirming telegram, Cable, telex or facsimile sending device. Notices shall be addressed (a) if to Counsellors at Counsellors' address, 466 Lexington Avenue, New York, New York 10017; (b) if to the Fund, at the address of the Fund; or (c) if to neither of the foregoing, at such other address as shall have been notified to the sender of any such Notice or other communication. If the location of the sender of a Notice or other communication and the address of the addressee thereof are, at the time of sending more than 100 miles apart, the Notice may be mailed, in which case it shall be deemed to have been given three days after it is sent, or if sent by confirming telegram, cable, telex, or facsimile sending device charges arising from the sending of a Notice hereunder shall be paid by the sender. 11. Further Actions. Each party agrees to perform such further acts and --------------- execute such further documents as are necessary to effectuate the purposes hereof. -8- 12. Amendments. This Agreement or any part hereof may be changed or ---------- waived only by an instrument in writing signed by the party against which enforcement of such change or waiver is sought. 13. Counterparts. This Agreement may be executed in two or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 14. Miscellaneous. This Agreement embodies the entire agreement and ------------- understanding between the parties thereto, and supersedes all prior agreements and understandings, relating to the subject matter hereof. The captions in this Agreement are included for convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. This Agreement shall be deemed to be a contract made in New York and governed by New York law. If any provision of this Agreement shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of this Agreement shall not be affected thereby. This Agreement shall be binding and shall inure to the benefit of the parties hereto and their respective successors. -9- IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their officers designated below as of the day and year first above written. THE RBB FUND, INC. By:/s/ Edward J. Roach ----------------------- Title: President and Treasurer COUNSELLORS FUNDS SERVICE, INC. By:/s/ Eugene Grace ------------------------ Title: -10- EX-99.9EEE 13 TRANSFER AGENCY AGREEMENT SUPPLEMENT Exhibit (9)(eee) TRANSFER AGENCY AGREEMENT SUPPLEMENT (Boston Partners Bond Fund) (Institutional Class) This supplemental agreement is entered into this 1st day of December, 1997 by and between THE RBB FUND, INC. (the "Company") and PFPC Inc., a Delaware corporation (the "Transfer Agent"), which is an indirect, wholly-owned subsidiary of PNC Bank Corp. The Company is a corporation organized under the laws of the State of Maryland and is an open-end management investment company. The Company and the Transfer Agent have entered into a Transfer Agency Agreement, dated as of November 5, 1991 (as from time to time amended and supplemented, the "Transfer Agency Agreement"), pursuant to which the Transfer Agent has undertaken to act as transfer agent, registrar and dividend disbursing agent for the Company with respect to the Shares of the Company, as more fully set forth therein. Certain capitalized terms used without definition in this Transfer Agency Agreement Supplement have the meaning specified in the Transfer Agency Agreement. The Fund agrees with the Transfer Agent as follows: 1. Adoption of Transfer Agency Agreement. The Transfer Agency Agreement ------------------------------------- is hereby adopted for the Boston Partners Bond Fund (the "Fund") Institutional Class of Common Stock (Class VV) of the Fund. 2. Compensation. As compensation for the services rendered by the ------------ Transfer Agent during the term of the Transfer Agency Agreement, the Fund will pay to the Transfer Agent, with respect to such Class of the Fund, monthly fees that shall be agreed to from time to time by the Company and the Transfer Agent, for each account open at any time during the month for which payment is being made, plus certain of the Transfer Agent's expenses relating to such services. 3. Counterparts. This Agreement may be executed in two or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the undersigned have entered into this Agreement, intending to be legally bound hereby, as of the date and year first above written. THE RBB FUND, INC. PFPC INC. By: /s/Edward J. Roach By: /s/ Robert Perlswig -------------------- ---------------------- Name: Edward J. Roach Name: Robert Perlswig Title: President and Treasurer Title: Executive Vice President EX-99.9FFF 14 TRANSFER AGENCY AGREEMENT SUPPLEMENT Exhibit (9)(fff) TRANSFER AGENCY AGREEMENT SUPPLEMENT (Boston Partners Bond Fund) (Investor Class) This supplemental agreement is entered into this 1st day of December, 1997 by and between THE RBB FUND, INC. (the "Company") and PFPC Inc., a Delaware corporation (the "Transfer Agent"), which is an indirect, wholly-owned subsidiary of PNC Bank Corp. The Company is a corporation organized under the laws of the State of Maryland and is an open-end management investment company. The Company and the Transfer Agent have entered into a Transfer Agency Agreement, dated as of November 5, 1991 (as from time to time amended and supplemented, the "Transfer Agency Agreement"), pursuant to which the Transfer Agent has undertaken to act as transfer agent, registrar and dividend disbursing agent for the Company with respect to the Shares of the Company, as more fully set forth therein. Certain capitalized terms used without definition in this Transfer Agency Agreement Supplement have the meaning specified in the Transfer Agency Agreement. The Fund agrees with the Transfer Agent as follows: 1. Adoption of Transfer Agency Agreement. The Transfer Agency Agreement ------------------------------------- is hereby adopted for the Boston Partners Bond Fund (the "Fund") Investor Class of Common Stock (Class WW) of the Fund. 2. Compensation. As compensation for the services rendered by the ------------ Transfer Agent during the term of the Transfer Agency Agreement, the Fund will pay to the Transfer Agent, with respect to such Class of the Fund, monthly fees that shall be agreed to from time to time by the Company and the Transfer Agent, for each account open at any time during the month for which payment is being made, plus certain of the Transfer Agent's expenses relating to such services. 3. Counterparts. This Agreement may be executed in two or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the undersigned have entered into this Agreement, intending to be legally bound hereby, as of the date and year first above written. THE RBB FUND, INC. PFPC INC. By: /s/ Edward J. Roach By: /s/ Robert Perlswig ------------------------------- ------------------------------ Name:Edward J. Roach Name: Robert Perlswig Title: President and Treasurer Title: Executive Vice President EX-99.9GGG 15 ADMINISTRATION & ACCOUNTING SERVICES AGREEMENT Exhibit (9)(ggg) ADMINISTRATION AND ACCOUNTING SERVICES AGREEMENT TERMS AND CONDITIONS This Agreement is made as of December 1, 1997 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 PNC Bank Corp. The Fund is registered as an open-end, non-diversified investment company under the Investment Company Act of 1940, as amended (the "1940 Act"). The Fund wishes to retain PFPC to provide administration and accounting services to its Boston Partners Bond Fund (the "Portfolio"), and PFPC wishes to furnish such services. In consideration of the promises and mutual covenants herein contained, the parties agree as follows: 1. Definitions. ----------- (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 and Written Instructions on behalf of the Fund and listed on the Certificate attached hereto as Appendix B or any amendment thereto as may be received by PFPC from time to 1 time. An Authorized Person's scope of authority may be limited by the Fund by setting forth such limitation on the Certificate. (d) "Book-Entry System" means Federal Reserve Treasury book-entry ------------------- system for United States and federal agency securities, its successor or successors, and its nominee or nominees and any book-entry system maintained by an exchange registered with the SEC under the 1934 Act. (e) "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. (f) "SEC" means the Securities and Exchange Commission. ----- (g) "Shares" mean the shares of common stock of the Fund representing -------- an interest in the Portfolio. (h) "Property" means: ---------- (i) any and all securities and other investment items of the Portfolio which the Fund may from time to time deposit, or cause to be deposited, with PFPC or which PFPC may from time to time hold for the Fund on behalf of the Portfolio; (ii) all income in respect of any of such securities or other investment items; (iii) all proceeds of the sale of any of such securities or investment items; and (iv) all proceeds of the sale of Shares which are received by PFPC from time to time, from or on behalf of the Fund. (i) "Written Instructions" mean written instructions signed by two ---------------------- Authorized Persons and received by PFPC. The 2 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 to provide services pursuant to this Agreement; (b) a copy of the Fund's most recent effective registration statement; (c) a copy of the Fund's advisory agreement or agreements with respect to the Portfolio; (d) a copy of the Fund's distribution agreement or agreements with respect to the Portfolio; (e) a copy of any additional administration agreement with respect to the Portfolio; (f) copies of any shareholder servicing agreements made in respect of the Portfolio; and (g) certified or authenticated copies of any and all amendments or supplements to the foregoing. 4. Compliance with Government Rules and Regulations. PFPC undertakes ------------------------------------------------ to comply with all applicable requirements of the 1933 Act, the 1934 Act and the 1940 Act, and any laws, rules and regulations of governmental authorities having jurisdiction with respect to all duties to be performed by 3 PFPC hereunder. Except as specifically set forth herein, PFPC assumes no responsibility for such compliance by the Fund. 5. Instructions. ------------ Unless otherwise provided in this Agreement, PFPC shall act only upon oral and Written Instructions. PFPC shall be entitled to rely upon any Oral 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 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. The Fund agrees to forward to PFPC Written Instructions confirming Oral Instructions 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. The Fund further agrees that PFPC shall incur no liability to the Fund in acting upon Oral or Written Instructions provided such instructions reasonably appear to have been received from an Authorized Person. 6. Right to Receive Advice. ----------------------- 4 (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 or Written Instructions, from the Fund. (b) Advice of Counsel. If PFPC shall be in doubt as to any questions ----------------- 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 advisor or PFPC, at the option of PFPC). (c) Conflicting Advice. In the event of a conflict between ------------------ directions, advice or Oral or Written Instructions PFPC receives from the Fund, and the advice it receives from counsel, PFPC shall be entitled to rely upon and follow the advice of counsel. (d) Protection of PFPC. PFPC shall be protected in any action it ------------------ takes or does not take in reliance upon directions, advice or Oral 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 or Written Instructions. Nothing in this paragraph shall be construed so as to impose an obligation upon PFPC (i) to seek such directions, advice or Oral or Written Instructions, or (ii) to act in accordance with such directions, advice or Oral 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. 5 7. Records. ------- The books and records pertaining to the Fund, which are in the possession 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 to be paid from the assets of the Portfolio. PFPC shall keep the following records: (a) all books and records with respect to the Portfolios books of account; (b) records of the Portfolio's securities transactions; (c) all other books and records as PFPC is required to maintain pursuant to Rule 3la-1 of the 1940 Act and as specifically set forth in Appendix B hereto. 8. Confidentiality. --------------- PFPC agrees to keep confidential all records of the Fund and information relative to the Fund and its shareholders (past, present and potential), 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. The Fund further agrees that, should PFPC be required to provide such information or records to duly 6 constituted authorities (who may institute civil or criminal contempt proceedings for failure to comply), PFPC shall not be required to seek the Fund's consent prior to disclosing such information. 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, all with respect to the Portfolio. PFPC shall take all reasonable action in the performance of its obligations under this Agreement to assure that the necessary information is made available to such accountants for the expression of their opinion, as such may be required by the Fund from time to time. 10. Disaster Recovery. ----------------- PFPC shall enter into and shall maintain in effect with appropriate parties one or more agreements making reasonable provision of 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 but shall have no liability with respect thereto. 11. Compensation. ------------ As compensation for services rendered by PFPC during the term of this Agreement, the Fund will pay to PFPC from the assets of the Portfolio a fee or fees as may be agreed to in writing by the Fund and PFPC. 7 12. Indemnification. --------------- The Fund agrees to indemnify and hold harmless PFPC and its nominees from all taxes, charges, expenses, assessments, claims and liabilities (including, without limitation, liabilities arising under the 1933 Act, the 1934 Act and the 1940 Act, and any state and 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 which PFPC takes or does not take (i) at the request or on the direction of or in reliance on the advice of the Fund or (ii) upon Oral or Written Instructions. Neither PFPC, nor any of its nominees, shall be indemnified against any liability to the Fund or to its shareholders (or any expenses incident to such liability) arising out of PFPC's own willful misfeasance, gross negligence or reckless disregard of its duties and obligations under this Agreement. 13. Responsibility of PFPC. ---------------------- PFPC shall be under no duty to take any action on behalf of the Fund 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, to act in good faith and to use its best efforts, within reasonable limits, in performing services provided for under this Agreement. PFPC shall be responsible for failure to perform its duties under this Agreement arising out of PFPC's gross negligence. Notwithstanding the foregoing, PFPC 8 shall not be responsible for losses beyond its control, provided that PFPC has acted in accordance with the standard of care set forth above; and provided further that PFPC shall only be responsible for that portion of losses or damages suffered by the fund that are attributable to the gross negligence of PFPC. Without limiting the generality of the foregoing or of any other provision of this Agreement, PFPC, in connection with its duties under this Agreement, shall not be liable for (a) the validity or invalidity or authority or lack thereof of any Oral 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) 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 or catastrophe, acts of God, insurrection, war, riots or failure of the mails, transportation, communication or power supply. Notwithstanding anything in this Agreement to the contrary, PFPC shall have no liability to the Fund for any consequential, special or indirect losses or damages which the Fund may incur or suffer by or as a consequence of PFPC's performance of the services provided hereunder, whether or not the likelihood of such losses or damages was known by PFPC. 9 14. Description of Accounting Services on a Continuing Basis. -------------------------------------------------------- PFPC will perform the following accounting functions with respect to the Portfolio if required: (i) Journalize investment, capital share and income and expense activities; (ii) verify investment buy/sell trade tickets when received from the investment advisor (the "Advisor") and transmit trades to the Fund's foreign 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 with the Custodian, and provide the Advisor with the beginning cash balance available for investment purposes; (vi) Update the cash availability throughout the day as required by the Advisor; (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; (xii) Determine net income; (xiii) Obtain security market quotes from independent pricing services approved by the Advisor, or if such quotes are unavailable, then obtain such prices from Advisor, and in either case calculate the market value of the investments; 10 (xiv) Transmit or mail a copy of the daily portfolio valuation to the Advisor; (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 includes the following items: Schedule of Investments Statement of Assets and Liabilities Statement of Operations Cash Statement Schedule of Capital Gains and Losses. 15. Description of Administration Services on a Continuing 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) (a) Assist in the preparation of support schedules necessary for completion of federal and state tax returns; or (b) prepare for execution and file the Fund's federal and state tax returns; (iv) (a) Assist in the preparation of Semi-Annual Reports with the SEC on Form N-SAR; or (b) prepare and file the Fund's Semi-Annual Reports with the SEC on Form N-SAR. (v) Assist in the preparation of annual, semi-annual, and quarterly shareholder reports; or (b) prepare and file with the SEC the Fund's annual, semi-annual, and quarterly shareholder reports; (vi) Assist with the preparation of registration statements and other filings relating to the registration of Shares; 11 (vii) Monitor the Portfolio's status as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended; and (viii) Coordinate contractual relationships and communications between the Fund and its service providers. 16. 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. 17. 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 shall be deemed to have been given on the day it is delivered. Notices shall be addressed (a) if to PFPC at PFPC's address, 400 Bellevue Parkway, Wilmington, Delaware 19809; (b) if to the Fund, at the address of the Fund; or (c) if to neither of the foregoing, at such other address as shall have been notified to the sender of any such Notice or other communication. 12 18. 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. 19. Delegation. ---------- PFPC may assign its rights and delegate its duties hereunder to any wholly owned director indirect subsidiary of PNC Bank, National Association or PNC Bank Corp., provided that (i) PFPC gives the Fund thirty (30) days' prior written notice; (ii) the delegate agrees with PFPC to comply with all relevant provisions of the 1940 Act; and (iii) PFPC and such delegate promptly provide such information as the Fund may request, and respond to such questions as the Fund may ask, relative to the delegation, including (without limitation) the capabilities of the delegate. 20. 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. 21. Further Actions. --------------- Each Party agrees to perform such further acts and execute such further documents as are necessary to effectuate the purposes hereof. 13 22. Miscellaneous. ------------- 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 and/or 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. This Agreement shall be deemed to be a contract made in Delaware and governed by Delaware law. If any provision of this Agreement shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of this Agreement shall not be affected thereby. This Agreement shall be binding and shall inure to the benefit off the parties hereto and their respective successors. 14 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their officers designated below on the day and year first above written. PFPC INC. By:/s/ Stephen Wynne ------------------------- Name: Stephen Wynne Title: Executive Vice President THE RBB FUND, INC. By:/s/ Edward J Roach ------------------------ Name: Edward J. Roach President & Treasurer 15 EX-99.11A 16 CONSENT OF DRINKER BIDDLE & REATH Exhibit 11(a) 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 Prospectuses and the caption "Miscellaneous- Counsel" in the Statements of Additional Information included in Post-Effective Amendment No. 51 to the Registration Statement (File No. 33-20827; and File No. 811-5518) on Form N-1A under the Securities Act of 1933 and the Investment Company Act of 1940, as amended, of The RBB Fund, Inc. 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 December 8, 1997 EX-99.11B 17 CONSENT OF INDEPENDENT ACCOUNTANTS CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the following with respect to Post-Effective Amendment No. 51 to the Registration Statement under the Securities Act of 1933 on Form N-1A (File No. 33-20827) of The RBB Fund, Inc.: . The incorporation by reference of our report dated October 17, 1997 on the audit of the financial statements and financial highlights of n/i Micro Cap Fund, n/i Growth Fund and n/i Growth & Value Fund of The RBB Fund, Inc., for the period ended August 31, 1997, which is included in the Annual Report to Shareholders. We also consent to the reference to our firm under the caption "Independent Accountants" in the Prospectus and "Miscellaneous-Independent Accountants" in the Statement of Additional Information. /s/ Coopers & Lybrand L.L.P. Coopers & Lybrand L.L.P. 2400 Eleven Penn Center Philadelphia, Pennsylvania December 4, 1997 EX-99.13M 18 PURCHASE AGREEMENT Exhibit (13)(m) PURCHASE AGREEMENT ------------------ The RBB Fund, Inc. (the "Fund"), a Maryland corporation, and Numeric Investors L.P. ("Numeric"), a Delaware limited partnership, intending to be legally bound, hereby agree with each other as follows: 1. The Fund hereby offers Numeric and Numeric hereby purchases $1,000 worth of shares of Class XX Common Stock (n/i Larger Cap Value Fund) of the Fund (par value $.001 per share) (such shares hereinafter sometimes collectively known as "Shares") at a price per Share equivalent to the net asset value per share of the n/i Larger Cap Value Fund shares of the Fund as determined on December 9, 1997. The Fund hereby acknowledges receipt from Numeric of funds in the amount of $1,000.00 in full payment for the Shares. 2. Numeric represents and warrants to the Fund that the Shares are being acquired for investment purposes and not with a view to the distribution thereof. 3. This agreement may be executed in counterparts, and all such counterparts taken together shall be deemed to constitute one and the same instrument. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the 1st day of December, 1997. THE RBB FUND, INC. By:/s/ Edward J. Roach -------------------------- President NUMERIC INVESTORS L.P. By:/s/ John C. Bogle, Jr. --------------------------- Managing Director EX-99.13N 19 PURCHASE AGREEMENT Exhibit (13)(n) PURCHASE AGREEMENT ------------------ The RBB Fund, Inc. (the "Fund"), a Maryland corporation, and Boston Partners Asset Management, L.P. ("BPAM"), intending to be legally bound, hereby agree with each other as follows: 1. The Fund hereby offers BPAM and BPAM hereby purchases $1,000 worth of shares of each of Classes VV and WW Common Stock of the Fund (par value $.001 per share) (such shares hereinafter sometimes collectively known as "Shares") at a price per Share equivalent to the net asset value per share of the Shares of the Fund as determined on December 9, 1997. 2. The Fund hereby acknowledges receipt from BPAM of funds in the amount of $2,000 in full payment for the Shares. 3. BPAM represents and warrants to the Fund that the Shares are being acquired for investment purposes and not with a view to the distribution thereof. 4. This agreement may be executed in counterparts, and all such counterparts taken together shall be deemed to constitute one and the same instrument. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the 1st day of December, 1997. THE RBB FUND, INC. By:/s/ Edward J. Roach ----------------------- President and Treasurer BOSTON PARTNERS ASSET MANAGEMENT, L.P. By:/s/ William J. Kelly ------------------------------- Treasurer EX-99.15DDD 20 PLAN OF DISTRIBUTION Exhibit (15)(ddd) PLAN OF DISTRIBUTION PURSUANT TO RULE 12b-1 OF THE RBB FUND, INC. (Boston Partners Bond Fund Institutional Class) WHEREAS, The RBB Fund, Inc. (the "Fund") intends to engage in business as an open-end management investment company and is registered as such under the Investment Company Act of 1940, as amended (the "Act"); and WHEREAS, the Fund desires to adopt a Plan of Distribution pursuant to Rule 12b-1 under the Act with respect to shares of its Class VV Common Stock, par value $.001 per share (the "Class VV Shares") and the Board of Directors has determined that there is a reasonable likelihood that adoption of this Plan of Distribution will benefit the Fund and its stockholders; and WHEREAS, the Fund intends to employ Counsellors Securities, Inc. (the "Distributor") as distributor of the Class VV Shares; and WHEREAS, the Fund and the Distributor intend to enter into a separate Distribution Agreement with the Fund for Class VV Shares, pursuant to which the Fund will employ the Distributor as distributor for the continuous offering of Class VV Shares; NOW, THEREFORE, the Fund hereby adopts, and the Distributor hereby agrees to the terms of, this Plan of Distribution (the "Plan") in accordance with Rule 12b-1 under the Act on the following terms and conditions: 1. The Fund shall pay to the Distributor, as the distributor of the Class VV Shares, compensation for distribution of its shares at an annual rate not to exceed .15% of the average daily net assets of the Class VV Shares. The amount of such compensation shall be agreed upon by the Board of Directors of the Fund and by the Distributor and shall be calculated and accrued daily and paid monthly or at such other intervals as the Board of Directors and the Distributor shall mutually agree. 2. The amount set forth in paragraph 1 of this Plan shall be paid for the Distributor's services as distributor of the Class VV Shares. Such amount may be spent by the Distributor on any activities or expenses primarily intended to result in the sale of Class VV Shares, including, but not limited to: compensation to and expenses of employees of the Distributor who engage in or support distribution of the Class VV Shares, including overhead and telephone expenses; printing of prospectuses and reports for other than existing shareholders; preparation, printing and distribution of sales literature and advertising materials; and compensation to certain financial institutions ("Service Organizations") who sell Class VV Shares. The Distributor may negotiate with any such Service Organizations the services to be provided by the Service Organization to shareholders in connection with the sale of Class VV Shares ("Distribution Services"), and all or any portion of the compensation paid to the Distributor under paragraph 1 of this Plan may be reallocated by the Distributor to Service Organizations who sell Class VV Shares. The compensation paid to Service Organizations with respect to Distribution Services will compensate Service Organizations to cover certain expenses primarily intended to result in the sale of Class VV Shares, including, but not limited to: (a) costs of payments made to employees that engage in the sale of Class VV Shares; (b) payments made to, and expenses of, persons who provide support services in connection with the sale of Class VV Shares, including, but not limited to, office space and equipment, telephone facilities, processing shareholder transactions and providing any other shareholder services not otherwise provided by the Fund's transfer agent; (c) costs relating to the formulation and implementation of marketing and promotional activities, including, but not limited to, direct mail promotions and television, radio, newspaper, magazine and other mass media advertising; (d) costs of printing and distributing prospectuses, statements of additional information and reports relating to the Class VV Shares to prospective shareholders of the Class VV Shares; (e) costs involved in preparing, printing and distributing sales literature pertaining to the Class VV Shares; and (f) costs involved in obtaining whatever information, analyses and reports with respect to marketing and promotional activities that the Service Organization may, from time to time, deem advisable. The compensation paid to Service Organizations with respect to Shareholder Services will compensate Service Organizations for personal service and/or the maintenance of shareholder accounts, including but not limited to (a) responding to inquiries of customers or clients of the Service Organization who beneficially own Class VV Shares ("Customers"), (b) providing information on Customer investments and (c) providing other shareholder liaison services. The compensation paid to Service Organizations with respect to Administrative Services will compensate Service Organizations for administrative and accounting services to their Customers, including, but not limited to: (a) aggregating and -2- processing purchase and redemption requests from Customers and placing net purchase and redemption orders with the Fund's distributor or transfer agent; (b) providing Customers with a service that invests the assets of their accounts in the Class VV Shares; (c) processing dividend payments from the Class VV Shares on behalf of Customers; (d) providing information periodically to Customers showing their positions in the Class VV Shares; (e) arranging for bank wires; (f) providing sub-accounting with respect to Class VV Shares beneficially owned by Customers or the information to the Fund necessary for sub-accounting; (g) forwarding shareholder communications from the Fund (for example, proxies, shareholder reports, annual and semi-annual financial statements and dividend, distribution and tax notices related to the Class VV Shares) to Customers, if required by law; and (h) providing other similar services to the extent permitted under applicable statutes, rules and regulations. 3. This Plan shall not take effect until it has been approved, together with any related agreements, by votes of a majority of both (a) the Board of Directors of the Fund and (b) those directors of the Fund who are not "interested persons" of the Fund (as defined in the Act) and have no direct or indirect financial interest in the operation of this Plan or any agreements related to it (the "Rule 12b-1 Directors"), cast in person at a meeting (or meetings) called for the purpose of voting on this Plan and such related agreements. 4. This Plan shall continue in effect until August 16, 1998. Thereafter, this Plan shall continue in effect for so long as such continuance is specifically approved at least annually in the manner provided for approval of this Plan in paragraph 3. 5. The Distributor shall provide to the Board of Directors of the Fund and the Board of Directors shall review, at least quarterly, a written report of the amounts expended pursuant to this Plan and the purposes for which such expenditures were made, including commissions, advertising, printing, interest, carrying charges and allocated overhead expenses. 6. This Plan may be terminated at any time by vote of a majority of the Rule 12b-1 Directors, or by a vote of a majority of the outstanding Class VV Shares. 7. This Plan may not be amended to increase materially the amount of compensation provided for in paragraph 1 hereof unless such amendment is approved by a vote of at least a majority (as defined in the Act) of the outstanding Class VV shares, and no material amendment to the Plan of any kind, including an amendment which would increase materially the amount -3- of compensation, shall be made unless approved in the manner provided for in paragraph 3 hereof. 8. While this Plan is in effect, the selection and nomination of Directors who are not interested persons (as defined in the Act) of the Fund shall be committed to the discretion of the then current Directors who are not interested persons (as defined in the Act) of the Fund. 9. The Fund shall preserve copies of this Plan and any related agreements and all reports made pursuant to paragraph 6 hereof for a period of not less than six years from the date of this Plan, the agreements or such reports, as the case may be, the first two years in an easily accessible place. Dated: October 15, 1997 -4- EX-99.15EEE 21 PLAN OF DISTRIBUTION Exhibit (15)(eee) PLAN OF DISTRIBUTION PURSUANT TO RULE 12b-1 OF THE RBB FUND, INC. (Boston Partners Bond Fund Investor Class) WHEREAS, The RBB Fund, Inc. (the "Fund") intends to engage in business as an open-end management investment company and is registered as such under the Investment Company Act of 1940, as amended (the "Act"); and WHEREAS, the Fund desires to adopt a Plan of Distribution pursuant to Rule 12b-1 under the Act with respect to shares of its Class WW Common Stock, par value $.001 per share (the "Class WW Shares") and the Board of Directors has determined that there is a reasonable likelihood that adoption of this Plan of Distribution will benefit the Fund and its stockholders; and WHEREAS, the Fund intends to employ Counsellors Securities, Inc. (the "Distributor") as distributor of the Class WW Shares; and WHEREAS, the Fund and the Distributor intend to enter into a separate Distribution Agreement with the Fund for Class WW Shares, pursuant to which the Fund will employ the Distributor as distributor for the continuous offering of Class WW Shares; NOW, THEREFORE, the Fund hereby adopts, and the Distributor hereby agrees to the terms of, this Plan of Distribution (the "Plan") in accordance with Rule 12b-1 under the Act on the following terms and conditions: 1. The Fund shall pay to the Distributor, as the distributor of the Class WW Shares, compensation for distribution of its shares at an annual rate not to exceed .25% of the average daily net assets of the Class WW Shares. The amount of such compensation shall be agreed upon by the Board of Directors of the Fund and by the Distributor and shall be calculated and accrued daily and paid monthly or at such other intervals as the Board of Directors and the Distributor shall mutually agree. 2. The amount set forth in paragraph 1 of this Plan shall be paid for the Distributor's services as distributor of the Class WW Shares. Such amount may be spent by the Distributor on any activities or expenses primarily intended to result in the sale of Class WW Shares, including, but not limited to: compensation to and expenses of employees of the Distributor who engage in or support distribution of the Class WW Shares, including overhead and telephone expenses; printing of prospectuses and reports for other than existing shareholders; preparation, printing and distribution of sales literature and advertising materials; and compensation to certain financial institutions ("Service Organizations") who sell Class WW Shares. The Distributor may negotiate with any such Service Organizations the services to be provided by the Service Organization to shareholders in connection with the sale of Class WW Shares ("Distribution Services"), and all or any portion of the compensation paid to the Distributor under paragraph 1 of this Plan may be reallocated by the Distributor to Service Organizations who sell Class WW Shares. The compensation paid to Service Organizations with respect to Distribution Services will compensate Service Organizations to cover certain expenses primarily intended to result in the sale of Class WW Shares, including, but not limited to: (a) costs of payments made to employees that engage in the sale of Class WW Shares; (b) payments made to, and expenses of, persons who provide support services in connection with the sale of Class WW Shares, including, but not limited to, office space and equipment, telephone facilities, processing shareholder transactions and providing any other shareholder services not otherwise provided by the Fund's transfer agent; (c) costs relating to the formulation and implementation of marketing and promotional activities, including, but not limited to, direct mail promotions and television, radio, newspaper, magazine and other mass media advertising; (d) costs of printing and distributing prospectuses, statements of additional information and reports relating to the Class WW Shares to prospective shareholders of the Class WW Shares; (e) costs involved in preparing, printing and distributing sales literature pertaining to the Class WW Shares; and (f) costs involved in obtaining whatever information, analyses and reports with respect to marketing and promotional activities that the Service Organization may, from time to time, deem advisable. The compensation paid to Service Organizations with respect to Shareholder Services will compensate Service Organizations for personal service and/or the maintenance of shareholder accounts, including but not limited to (a) responding to inquiries of customers or clients of the Service Organization who beneficially own Class WW Shares ("Customers"), (b) providing information on Customer investments and (c) providing other shareholder liaison services. The compensation paid to Service Organizations with respect to Administrative Services will compensate Service Organizations for administrative and accounting services to their Customers, including, but not limited to: (a) aggregating and -2- processing purchase and redemption requests from Customers and placing net purchase and redemption orders with the Fund's distributor or transfer agent; (b) providing Customers with a service that invests the assets of their accounts in the Class WW Shares; (c) processing dividend payments from the Class WW Shares on behalf of Customers; (d) providing information periodically to Customers showing their positions in the Class WW Shares; (e) arranging for bank wires; (f) providing sub-accounting with respect to Class WW Shares beneficially owned by Customers or the information to the Fund necessary for sub-accounting; (g) forwarding shareholder communications from the Fund (for example, proxies, shareholder reports, annual and semi-annual financial statements and dividend, distribution and tax notices related to the Class WW Shares) to Customers, if required by law; and (h) providing other similar services to the extent permitted under applicable statutes, rules and regulations. 3. This Plan shall not take effect until it has been approved, together with any related agreements, by votes of a majority of both (a) the Board of Directors of the Fund and (b) those directors of the Fund who are not "interested persons" of the Fund (as defined in the Act) and have no direct or indirect financial interest in the operation of this Plan or any agreements related to it (the "Rule 12b-1 Directors"), cast in person at a meeting (or meetings) called for the purpose of voting on this Plan and such related agreements. 4. This Plan shall continue in effect until August 16, 1998. Thereafter, this Plan shall continue in effect for so long as such continuance is specifically approved at least annually in the manner provided for approval of this Plan in paragraph 3. 5. The Distributor shall provide to the Board of Directors of the Fund and the Board of Directors shall review, at least quarterly, a written report of the amounts expended pursuant to this Plan and the purposes for which such expenditures were made, including commissions, advertising, printing, interest, carrying charges and allocated overhead expenses. 6. This Plan may be terminated at any time by vote of a majority of the Rule 12b-1 Directors, or by a vote of a majority of the outstanding Class WW Shares. 7. This Plan may not be amended to increase materially the amount of compensation provided for in paragraph 1 hereof unless such amendment is approved by a vote of at least a majority (as defined in the Act) of the outstanding Class WW shares, and no material amendment to the Plan of any kind, including an amendment which would increase materially the amount -3- of compensation, shall be made unless approved in the manner provided for in paragraph 3 hereof. 8. While this Plan is in effect, the selection and nomination of Directors who are not interested persons (as defined in the Act) of the Fund shall be committed to the discretion of the then current Directors who are not interested persons (as defined in the Act) of the Fund. 9. The Fund shall preserve copies of this Plan and any related agreements and all reports made pursuant to paragraph 6 hereof for a period of not less than six years from the date of this Plan, the agreements or such reports, as the case may be, the first two years in an easily accessible place. Dated: October 15, 1997 -4- EX-99.16C 22 SCHEDULES OF COMPUTATION OF PERFORMANCE QUOTATIONS Exhibit 16(c) THE RBB FUND, INC. n/i Portfolios Schedule for Computation of Performance Quotations Total Return AGGREGATE TOTAL RETURN = (ENDING REDEEMABLE VALUE/INITIAL PAYMENT) - -------------------------------------------------------------------- 1 OF $10,000 ------------ For the Fiscal Period Ended August 31, 1997: n/i Growth Fund aggregate total return = 37.69% 37.69% = (13,768.75/10,000) - 1 n/i Growth and Value Fund aggregate total return = 49.11% 49.11% = (14,910.91/10,000) - 1 n/i Micro Cap Fund aggregate total return = 58.41% 58.41% = (15,840.52/10,000) - 1 EX-27.1 23 ARTICLE 6 FINANCIAL DATA SCHEDULE FOR N/I MICRO CA
6 0000831114 THE RBB FUND, INC. 19 NI MICRO CAP FUND 6-MOS AUG-31-1997 AUG-31-1997 123,155,231 144,518,667 4,285,468 17,219 0 148,821,354 6,366,294 0 335,561 6,701,855 0 112,102,569 7,694,317 1,208,365 (31,353) 0 9,346,125 0 20,739,610 142,119,499 188,127 271,972 0 491,452 (31,353) 9,346,125 20,739,610 30,054,382 0 23,429 0 0 116,335,000 18,368,326 21,772 128,019,399 13,553 (651,401) 0 0 368,604 0 714,867 49,147,187 11.67 (.01) 6.82 .01 0 0 18.47 1.00 0 0
EX-27.2 24 ARTICLE 6 FINANCIAL DATA SCHEDULE FOR N/I GROWTH
6 0000831114 THE RBB FUND, INC. 20 NI GROWTH FUND 6-MOS AUG-31-1997 AUG-31-1997 104,718,605 119,988,181 2,493,770 18,738 0 122,500,689 4,479,699 0 297,092 4,776,791 0 92,659,747 7,226,740 2,259,414 (257,096) 0 10,621,079 0 14,212,378 117,723,898 131,954 289,810 0 678,860 (257,096) 10,621,079 14,212,378 24,576,361 0 37,127 0 0 85,903,977 19,510,716 35,671 90,968,166 22,490 (554,771) 0 0 509,145 0 951,795 67,886,056 11.84 (.04) 4.50 .01 0 0 16.29 1.00 0 0
EX-27.3 25 ARTICLE 6 FINANCIAL DATA SCHEDULE N/I GROWTH & VALUE
6 0000831114 THE RBB FUND, INC. 21 NI GROWTH & VALUE FUND 6-MOS AUG-31-1997 AUG-31-1997 54,164,428 58,093,965 2,439,718 7,642 0 60,541,325 7,718,659 0 331,846 8,050,505 0 42,934,628 3,059,247 329,787 192,219 0 5,488,625 0 3,920,436 52,490,820 350,510 85,800 0 244,091 192,219 5,488,625 3,920,436 9,601,280 0 48,450 0 0 44,012,804 4,933,777 45,813 48,677,670 9,319 (15,057) 0 0 183,069 0 440,859 24,369,929 11.56 .08 5.58 .06 0 0 17.16 1.00 0 0
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