As filed with the Securities and Exchange Commission on December 15, 2011
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 |
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Pre-Effective Amendment No. |
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Post-Effective Amendment No. 144 |
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REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 |
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Amendment No. 146 |
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THE RBB FUND, INC.
(Exact Name of Registrant as Specified in Charter)
Bellevue Park Corporate Center
103 Bellevue Parkway
Wilmington, DE 19809
(Address of Principal Executive Offices)
Registrants Telephone Number: (302) 791-1851
Copies to:
SALVATORE FAIA BNY Mellon Investment Servicing (US) Inc. 103 Bellevue Parkway Wilmington, DE 19809 (Name and Address of Agent for Service) |
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MICHAEL P. MALLOY, ESQUIRE Drinker Biddle & Reath LLP One Logan Square, Ste. 2000 Philadelphia, PA 19103-6996 |
It is proposed that this filing will become effective (check appropriate box)
o immediately upon filing pursuant to paragraph (b)
o on [date] pursuant to paragraph (b)
o 60 days after filing pursuant to paragraph (a)(1)
o on [date] pursuant to paragraph (a)(1)
x 75 days after filing pursuant to paragraph (a)(2)
o on [date] pursuant to paragraph (a)(2) of Rule 485
If appropriate, check the following box:
o This post-effective amendment designates a new effective date for a previously filed post-effective amendment.
Title of Securities Being Registered Shares of Common Stock
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS
SUMMIT GLOBAL INVESTMENTS
U.S. LOW VOLATILITY EQUITY FUND
Class I Shares
TICKER: [ ]
of The RBB Fund, Inc.
This prospectus gives vital information about the Summit Global Investments U.S. Low Volatility Equity Fund (the Fund), an investment portfolio of The RBB Fund, Inc. (the Company), including information on investment policies, risks and fees. For your own benefit and protection, please read it before you invest and keep it on hand for future reference.
PROSPECTUS
[March 1, 2012]
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
THE SECURITIES DESCRIBED IN THIS PROSPECTUS HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION (SEC). THE SEC, HOWEVER, HAS NOT JUDGED THESE SECURITIES FOR THEIR INVESTMENT MERIT AND HAS NOT DETERMINED THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANYONE WHO TELLS YOU OTHERWISE IS COMMITTING A CRIMINAL OFFENSE.
TABLE OF CONTENTS
A look at the goals, strategies, risks and financial history of the Fund. |
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SUMMARY SECTION |
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Investment Objective |
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Expenses and Fees |
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Risk/Return Information |
2 |
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Management of the Fund |
2 |
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Purchase and Sale of Fund Shares |
2 |
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Tax Information |
3 |
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Payments to Broker-Dealers and Other Financial Intermediaries |
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ADDTIONAL INFORMATION ON THE FUNDS INVESTMENT OBJECTIVE AND PRINCIPAL STRATEGIES |
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ADDITIONAL INFORMATION ON RISKS OF INVESTING IN THE FUND |
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Details about the Funds service providers. |
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MANAGEMENT OF THE FUND |
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Investment Adviser |
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Portfolio Manager |
6 |
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Other Service Providers |
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Policies and instructions for opening, maintaining and closing an account in the Fund. |
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SHAREHOLDER INFORMATION |
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Pricing of Fund Shares |
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Market Timing |
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Purchase of Fund Shares |
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Redemption of Fund Shares |
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Dividends and Distributions |
12 |
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Taxes |
12 |
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Appendix A Prior Performance of Similarly Advised Accounts |
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FOR MORE INFORMATION |
Back Cover |
SUMMARY SECTION
Investment Objective
The Summit Global Investments U.S. Low Volatility Equity Fund (the Fund) seeks to outperform the S&P 500 ® Index over a market cycle while significantly reducing the overall volatility of its portfolio through quantitative and fundamental stock selection. There can be no guarantee that the Fund will achieve its investment objective.
Expenses and Fees
This table describes the fees and expenses that you may pay if you buy and hold Class I shares of the Fund.
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Class I |
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Shareholder Fees (fees paid directly from your investment) |
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Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) |
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None |
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Maximum Deferred Sales Charge (Load) |
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None |
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Maximum Sales Charge (Load) Imposed on Reinvested Dividends |
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None |
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Redemption Fee (as a percentage of amount redeemed on shares held for less than 60 days, if applicable) |
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1.50 |
% |
Exchange Fee (as a percentage of amount redeemed on shares held for less than 60 days, if applicable) |
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1.50 |
% |
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Annual Fund Operating Expenses (expenses that that you pay each year as a percentage of the value of your investment) |
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Management Fees |
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0.70 |
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Distribution (12b-1) Fees |
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None |
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Other Expenses (1) |
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0.98 |
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Total Annual Fund Operating Expenses |
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1.68 |
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Fee Waivers and Expense Reimbursements (2) |
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0.70 |
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Net Expenses |
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0.98 |
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(1) Other expenses are based on estimated amounts for the current fiscal year.
(2) The Funds investment adviser has contractually agreed to waive management fees and reimburse expenses through [March 1, 2013], to the extent that Total Annual Fund Operating Expenses (excluding acquired fund fees and expenses, brokerage commissions, extraordinary items, interest and taxes) exceed 0.98%.
Example:
This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The Example assumes that you invest $1,000,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Funds operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
1 Year |
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3 Years |
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9,997 |
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46,118 |
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Portfolio Turnover
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover rate may indicate higher transactions costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the example, affect the Funds performance.
Principal Investment Strategies
Under normal circumstances, the Fund will invest at least 80% of its net assets (including borrowings for investment purposes) in equity securities, primarily common stocks, of U.S. companies. The Funds investment adviser attempts to lower the Funds market risk by investing in U.S. equity securities that lower the overall volatility of the Funds portfolio as compared to the S&P 500 ® Index. The Fund invests in stocks that exhibit less
volatile stock price patterns, strengthening business metrics and quantitative factors that the Funds investment adviser anticipates will produce less volatility with more capital protection and more consistent returns.
Principal Risks
· Common Stock Risk. Investments in common stocks are subject to market, economic and business risks that will cause their price to fluctuate over time. Therefore, an investment in the Fund may be more suitable for long-term investors who can bear the risk of these fluctuations.
· Management Risk. The Fund is subject to the risk of poor management stock selection. In other words, the individual stocks in the Fund may not perform as well as expected, and/or the Funds portfolio management practices do not work to achieve their desired result.
· Market Risk. The net asset value (NAV) of the Fund will change with changes in the market value of its portfolio positions. Investors may lose money. Although the Fund will invest in stocks the Funds investment adviser believes will produce less volatility, there is no guarantee that the stocks will perform as expected.
· Opportunity Risk. As with all mutual funds, the Fund is subject to the risk of missing out on an opportunity because the assets necessary to take advantage of it are tied up in less advantageous investments.
Performance Information
No performance information is available for the Fund because it had not commenced operations as of the date of this Prospectus. The Fund intends to evaluate its performance as compared to that of the S&P 500 ® Index.
Management of the Fund
Investment Adviser
Summit Global Investments, LLC
Portfolio Manager
David Harden
President of the Investment Adviser
Portfolio Manager of the Fund since inception
Purchase and Sale of Fund Shares
Minimum Initial Investment
$1,000,000
Shares of the Fund may be available through certain brokerage firms, financial institutions and other industry professionals (collectively, Service Organizations). Certain features, such as the initial and subsequent investment minimums and certain trading restrictions, may be modified or waived by Service Organizations. Service Organizations may impose transaction or administrative charges or other direct fees, which charges and fees would not be imposed if shares are purchased directly from The RBB Fund, Inc. The Fund may accept initial investments of smaller amounts in its sole discretion.
You can only purchase and redeem shares of the Fund on days the New York Stock Exchange (NYSE) is open and through the means described below.
Purchase and Redemption By Mail:
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
P.O. Box [ ]
Providence, RI 02940-8042
Overnight Mail:
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
4400 Computer Drive
Westborough, MA 01581
Purchase and Redemption By Wire:
[ ]
ABA# [ ]
Account # [ ]
F/B/O Summit Global Investments U.S. Low Volatility Equity Fund
Ref. (Shareholder Name; Account Number)
Redemption By Telephone: If you select the option on your account application, you may call the Funds transfer agent at [ ].
Tax Information
The Fund intends to make distributions that may be taxed as ordinary income or capital gains. The Fund contemplates declaring as dividends each year all or substantially all of its taxable income.
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediarys website for more information.
ADDITIONAL INFORMATION ABOUT THE FUNDS INVESTMENTS AND RISKS
This section provides some additional information about the Funds investments and certain portfolio management techniques that the Fund may use. More information about the Funds investments and portfolio management techniques, some of which entail risks, is included in the Statement of Additional Information (SAI).
Investment Objective
The Funds investment objective may be changed by the Board of Directors of The RBB Fund, Inc. (the Company) without shareholder approval. Shareholders will, however, receive 60 days prior notice of any changes. Any such changes may result in the Fund having an investment objective different from the objective that the shareholder considered appropriate at the time of investment in the Fund.
Additional Information About the Funds Investment Strategies
Other Investment Companies. The Fund may invest up to 10% of its total assets in the securities of other investment companies not affiliated with the Adviser, but may not invest more than 5% of its total assets in the securities of any one investment company or acquire more than 3% of the voting securities of any other investment company. Among other things, the Fund may invest in money market mutual funds for cash management purposes by sweeping excess cash balances into such funds until the cash is invested or otherwise utilized. Rule 12d1-1 under the Investment Company Act of 1940, as amended, permits the Fund to invest an unlimited amount of its uninvested cash in a money market fund so long as, among other things, said investment is consistent with the Funds investment objectives and policies. The Fund will indirectly bear its proportionate share of any management fees and other expenses paid by investment companies in which it invests in addition to the advisory and administration fees paid by the Fund.
Securities Lending. The Fund may seek to increase its income by lending portfolio securities to institutions, such as certain broker-dealers. Portfolio securities loans are secured continuously by collateral maintained on a current basis at an amount at least equal to the market value of the securities loaned. The value of the securities loaned by the Fund will not exceed 331/3% of the value of the Funds total assets. The Fund may experience a loss or delay in the recovery of its securities if the borrowing institution breaches its agreement with the Fund. Lending the Funds portfolio securities involves the risk of delay in receiving additional collateral if the value of the securities goes up while they are on loan.
Borrowing. The Fund may borrow money for temporary or emergency (not leveraging) purposes. The Fund will not make any additional investments while borrowings exceed 5% of its total assets.
Temporary Investments. The Fund may depart from its principal investment strategy in response to adverse market, economic, political or other conditions by taking a temporary defensive position (up to 100% of its assets) in all types of money market and short-term debt securities. If the Fund were to take a temporary defensive position, it may be unable for a time to achieve its investment objective.
Additional Information About the Funds Risks
The following provides additional information about the risks of investing in the Fund:
· At least 80% of the Funds net assets will be invested under normal circumstances in equity securities, and the net asset value of the Fund will vary with changes in the market value of the portfolio positions. The Fund will provide shareholders with at least 60 days prior written notice of any change in this 80% policy.
· The market value of a portfolio holding may fluctuate, sometimes rapidly and unpredictably. The prices of equity securities change in response to many factors including the historical and prospective earnings of the issuer, the value of its assets, general economic conditions, interest rates, investor perceptions and market liquidity. Decreases in market value of the Funds portfolio securities could adversely affect the Funds net asset value.
· The Fund may, for temporary defensive purposes, invest a percentage of its total assets, without limitation, in cash or various money market instruments. The value of money market instruments tends to fall when current interest rates rise. Money market instruments are generally less sensitive to interest rate changes than longer-term securities. When the Funds assets are invested in cash or money market instruments, the Fund may not achieve its investment goal.
Disclosure of Portfolio Holdings
A description of the Companys policies and procedures with respect to the disclosure of the Funds portfolio securities is available in the Funds SAI.
MANAGEMENT OF THE FUND
Investment Adviser
Summit Global Investments, LLC (the Adviser) serves as the Funds investment adviser. The Advisers principal address is 189 North, Hwy 89, Suite 144, North Salt Lake, Utah 84054. The Adviser provides investment management and investment advisory services to investment companies and other institutional accounts.. The Adviser is 100% employee-owned, and was founded in 2010.
Pursuant to an investment advisory agreement with the Company, the Adviser is entitled to an advisory fee computed daily and payable monthly at the annual rate of 0.70% of the Funds average daily net assets. The Adviser has contractually agreed to waive its management fees and reimburse expenses through [March 1, 2013], to the extent that the Funds total annual operating expenses (excluding acquired fund fees and expenses, brokerage commissions, extraordinary items, interest and taxes) exceed 0.98%.
A discussion regarding the basis for the Companys Board of Directors approving the Funds investment advisory agreement with the Adviser will be available in the Funds first report to shareholders.
Portfolio Manager
The President of the Adviser, David Harden, is primarily responsible for the day-to-day management of the Funds investment portfolio. Mr. Harden founded the Adviser in 2010, and has managed the Fund since its inception. He started his career in 1993 and has worked for such firms as Fidelity Investments, Wellington Management and Evergreen Investments. From 2006 to 2011, Mr. Harden has worked with Ensign Peak Advisors, Inc., most recently as Vice President and Senior Portfolio Manager, where he managed and oversaw day-to-day research, portfolio management and trading for all index, quantitative and low volatility strategies.
The SAI provides additional information about the portfolio managers compensation, other accounts managed by the portfolio manager and the portfolio managers ownership of securities in the Fund.
Other Service Providers
The following chart shows the Funds service providers and includes their addresses and principal activities.
SHAREHOLDER INFORMATION
Pricing of Fund Shares
Class I Shares of the Fund are sold at their net asset value (NAV). The NAV of Class I Shares of the Fund is calculated as follows:
NAV = |
Value of Assets Attributable to Class I Shares of the Fund |
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Value of Liabilities Attributable Class I Shares of the Fund |
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Number of Outstanding Class I Shares of the Fund |
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The Funds NAV is calculated once daily at the close of regular trading hours on the New York Stock Exchange (NYSE) (generally 4:00 p.m. Eastern time) on each day the NYSE is open. The NYSE is generally open Monday through Friday, except national holidays. The Fund will effect purchases and redemptions of Fund shares at the NAV next calculated after receipt of your order or request in good order.
The Funds equity securities listed on any national or foreign exchange market system will be valued at the last sale price, except for the National Association of Securities Dealers Automatic Quotation System (NASDAQ). Equity securities listed on NASDAQ will be valued at the official closing price. Equity securities traded in the over-the-counter market are valued at their closing prices. If there were no transactions on that day, securities traded principally on an exchange or on NASDAQ will be valued at the mean of the last bid and ask prices prior to the market close. Fixed income securities having a remaining maturity of 60 days or less are valued at amortized cost, which approximates market value. Fixed income securities having a remaining maturity of greater than 60 days are valued using an independent pricing service. When prices are not available from such services or are deemed to be unreliable, securities may be valued by dealers who make markets in such securities.
If market quotations are unavailable or deemed unreliable by the Funds administrator, in consultation with the Adviser, securities will be valued in accordance with procedures adopted by the Companys Board of Directors and under the Board of Directors ultimate supervision. Relying on prices supplied by pricing services or dealers or using fair valuation involves the risk that the values used by a Fund to price its investments may be higher or lower than the values used by other investment companies and investors to price the same investments.
Investments in other open-end investment companies are valued based on the NAV of those investment companies (which may use fair value pricing as discussed in their prospectuses).
Market Timing
In accordance with the policy adopted by the Companys Board of Directors, the Company discourages and does not accommodate market timing and other excessive trading practices. Purchases should be made with a view to longer-term investment only. Excessive short-term (market timing) trading practices may disrupt portfolio management strategies, increase brokerage and administrative costs, harm Fund performance and result in dilution in the value of Fund shares held by long-term shareholders. The Company and the Adviser reserve the right to (i) reject a purchase or exchange order, (ii) delay payment of immediate cash redemption proceeds for up to seven calendar days, (iii) revoke a shareholders privilege to purchase Fund shares (including exchanges), or (iv) limit the amount of any exchange. An investor may receive notice that their purchase order or exchange has been rejected after the day the order is placed or after acceptance by a financial intermediary. . The Company and the Adviser will not be liable for any loss resulting from rejected purchase orders. To minimize harm to the Company and its shareholders (or the Adviser), the Company (or the Adviser) will exercise their right if, in the Companys (or the Advisers) judgment, an investor has a history of excessive trading or if an investors trading, in the judgment of the Company or the Adviser, has been or may be disruptive to the Fund. No waivers of the provisions of the policy established to detect and deter market timing and other excessive trading activity are permitted that would harm the Fund and its shareholders or would subordinate the interests of the Fund and its shareholders to those of the Adviser or any affiliated person or associated person of the Adviser.
To deter excessive shareholder trading, the Fund charges a redemption fee of 1.50% on shares redeemed within 60 days of purchase. For further information on redemptions, please see the section entitled Shareholder Information Redemptions of Fund Shares.
There is no assurance that the Adviser will be able to identify market timers, particularly if they are investing through intermediaries.
If necessary, the Company may prohibit additional purchases of Fund shares by a financial intermediary or by certain customers of the financial intermediary. Financial intermediaries may also monitor their customers trading activities in the Fund. The criteria used by intermediaries to monitor for excessive trading may differ from the criteria used by the Company. If a financial intermediary fails to enforce the Companys excessive trading policies, the Company may take certain actions, including terminating the relationship.
Purchase of Fund Shares
Shares representing interests in the Fund are offered continuously for sale by BNY Mellon Distributors Inc. (the Distributor). Class I shares of the Fund are available for purchase by institutional investors that meet the investment minimums described below under General..
Purchases Through Intermediaries. Class I shares of the Fund may also be available through Service Organizations. Certain features of the shares, such as the initial and subsequent investment minimums and certain trading restrictions, may be modified or waived by Service Organizations. Service Organizations may impose transaction or administrative charges or other direct fees, which charges and fees would not be imposed if shares are purchased directly from the Company. Therefore, you should contact the Service Organization acting on your behalf concerning the fees (if any) charged in connection with a purchase or redemption of shares and should read this Prospectus in light of the terms governing your accounts with the Service Organization. Service Organizations will be responsible for promptly transmitting client or customer purchase and redemption orders to the Company in accordance with their agreements with the Company or its agent and with clients or customers. Service Organizations or, if applicable, their designees that have entered into agreements with the Company or its agent may enter confirmed purchase orders on behalf of clients and customers, with payment to follow no later than the Companys pricing on the following Business Day. If payment is not received by such time, the Service Organization could be held liable for resulting fees or losses. The Company will be deemed to have received a purchase or redemption order when a Service Organization, or, if applicable, its authorized designee, accepts a purchase or redemption order in good order if the order is actually received by the Company in good order not later than the next business morning. If a purchase order is not received by the Fund in good order, BNY Mellon Investment Servicing (US) Inc. (the Transfer Agent) will contact the financial intermediary to determine the status of the purchase order. Orders received by the Company in good order will be priced at the appropriate Funds NAV next computed after they are deemed to have been received by the Service Organization or its authorized designee.
The Company relies upon the integrity of Service Organizations to ensure that orders are timely and properly submitted. The Fund cannot assure you that a Service Organization properly submitted to it all purchase and redemption orders received from the Service Organizations customers before the time for determination of the Funds NAV in order to obtain that days price.
For administration, subaccounting, transfer agency and/or other services, the Adviser, the Distributor or their affiliates may pay Service Organizations and certain recordkeeping organizations a fee (the Service Fee) relating to the average annual NAV of accounts with the Company maintained by such Service Organizations or recordkeepers. The Service Fee payable to any one Service Organization is determined based upon a number of factors, including the nature and quality of services provided, the operations processing requirements of the relationship and the standardized fee schedule of the Service Organization or recordkeeper.
General. You may also purchase Class I shares of the Fund at the NAV per share next calculated after your order is received by the Transfer Agent in good order as described below. The Funds NAV is calculated once daily at the close of regular trading hours on the NYSE (generally 4:00 p.m. Eastern time) on each day the NYSE is open. After an initial purchase is made, the Transfer Agent will set up an account for you on the Companys records. The minimum initial investment in the Fund is $1,000,000 and there is no minimum subsequent investment amount. The minimum initial investment requirements may be reduced or waived from time to time. For purposes of meeting the minimum initial purchase, purchases by clients which are part of endowments, foundations or other related groups may be combined. You can only purchase shares of the Fund on days the NYSE is open and through the means described below. Shares may be purchased by principals and employees of the Adviser and its subsidiaries and by their spouses and children either directly or through any trust that has the principal, employee, spouse or child as the primary beneficiaries, their individual retirement accounts, or any pension and profit-sharing plan of the Adviser and its subsidiaries without being subject to the minimum investment limitations.
Initial Investment By Mail. Subject to acceptance by the Fund, an account may be opened by completing and signing an Account Application and mailing it to the Fund at the address noted below, together with a check payable to Summit Global Investments U.S. Low Volatility Equity Fund. Third party endorsed checks or foreign checks will not be accepted.
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
P.O. Box [ ]
Providence, RI 02940
or overnight to:
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
4400 Computer Drive
Westborough, MA 01581
Subject to acceptance by the Fund, payment for the purchase of shares received by mail will be credited to a shareholders account at the NAV per share of the Fund next determined after receipt of payment in good order.
Initial Investment By Wire. Subject to acceptance by the Fund, Class I shares may be purchased by wiring federal funds to [ ] (see instructions below). A completed Account Application must be forwarded to the Transfer Agent at the address noted above under Initial Investment by Mail in advance of the wire. Notification must be given to the Transfer Agent at (888) 520-3277 prior to 4:00 p.m., Eastern time, on the wire date. (Prior notification must also be received from investors with existing accounts.) Funds should be wired to:
Federal funds wire purchases will be accepted only on days when the Fund and [ ] are open for business.
Additional Investments. Additional investments may be made at any time by purchasing shares at the NAV per share of the Fund by mailing a check to the Transfer Agent at the address noted above under Initial Investment by Mail (payable to Summit Global Investments U.S. Low Volatility Equity Fund) or by wiring monies to the custodian bank as outlined above under Initial Investment by Wire. Notification must be given to the Transfer Agent at [ ] prior to 4:00 p.m., Eastern time, on the wire date. Initial and additional purchases made by check cannot be redeemed until payment of the purchase has been collected, which may take up to fifteen calendar days from the purchase date.
Retirement Plans/IRA Accounts. A $15.00 retirement custodial maintenance fee is charged per IRA account per year. For further information as to applications and annual fees, contact the Transfer Agent at [ ]. To determine whether the benefits of an IRA are available and/or appropriate, you should consult with a tax advisor.
Other Purchase Information. The Company reserves the right, in its sole discretion, to suspend the offering of shares or to reject purchase orders when, in the judgment of management, such suspension or rejection is in the best interest of the Fund. The Adviser will monitor the Funds total assets and may, subject to Board approval, decide to close the Fund at any time to new investments or to new accounts due to concerns that a significant increase in the size of the Fund may adversely affect the implementation of the Funds strategy. The Adviser, subject to Board approval, may also choose to reopen the Fund to new investments at any time, and may subsequently close the Fund again should concerns regarding the Funds size recur. If the Fund closes to new investments, the Fund may be offered only to certain existing shareholders of the Fund and certain other persons who may be subject to cumulative, maximum purchase amounts, as follows:
a. persons who already hold shares of the Fund directly or through accounts maintained by brokers by arrangement with the Adviser,
b. employees of the Adviser and their families, and
c. directors of the Company.
Distributions to all shareholders of the Fund will continue to be reinvested unless a shareholder elects otherwise. The Adviser, subject to Board approval, reserves the right to implement specific purchase limitations at the time of closing, including limitations on current shareholders.
Purchases of the Funds shares will be made in full and fractional shares of the Fund calculated to three decimal places. Certificates for shares will not be issued except at the written request of the shareholder. Certificates for fractional shares, however, will not be issued.
Shares may be purchased and subsequent investments may be made by principals and employees of the Adviser and their family members, either directly or through their IRAs and by any pension and profit-sharing plan of the Adviser, without being subject to the minimum investment limitation.
The Companys officers are authorized to waive the minimum initial and subsequent investment requirements.
Good Order. You must include complete and accurate required information on your purchase request. Please see Purchase of Fund Shares for instructions. Purchase requests not in good order may be rejected.
Customer Identification Program. Federal law requires the Company to obtain, verify and record identifying information, which may include the name, residential or business street address, date of birth (for an individual), social security or taxpayer identification number or other identifying information for each investor who opens or reopens an account with the Company. Applications without the required information, or without any indication that a social security or taxpayer identification number has been applied for, may not be accepted. After acceptance, to the extent permitted by applicable law or its customer identification program, the Company reserves the right (a) to place limits on transactions in any account until the identity of the investor is verified; or (b) to refuse an investment in a Company portfolio or to involuntarily redeem an investors shares and close an account in the event that an investors identity is not verified. The Company and its agents will not be responsible for any loss in an investors account resulting from the investors delay in providing all required identifying information or from closing an account and redeeming an investors shares when an investors identity cannot be verified.
Redemption of Fund Shares
You may redeem Class I shares of the Fund at the next NAV calculated after a redemption request is received by the Transfer Agent in good order. The Funds NAV is calculated once daily at the close of regular trading hours on the
NYSE (generally 4:00 p.m. Eastern time) on each day the NYSE is open. You can only redeem shares of the Fund on days the NYSE is open and through the means described below.
You may redeem shares of the Fund by mail, or, if you are authorized, by telephone. The value of shares redeemed may be more or less than the purchase price, depending on the market value of the investment securities held by the Fund.
Redemption By Mail. Your redemption requests should be addressed to Summit Global Investments U.S. Low Volatility Equity Fund, c/o BNY Mellon Investment Servicing (US) Inc., P.O. Box [ ], Providence, RI 02940, or for overnight delivery to Summit Global Investments U.S. Low Volatility Equity Fund, c/o BNY Mellon Investment Servicing (US) Inc., 4400 Computer Drive, Westborough, MA 01581 and must include:
· a letter of instruction, if required, or a stock assignment specifying the number of shares or dollar amount to be redeemed, signed by all registered owners of the shares in the exact names in which they are registered;
· any required Medallion signature guarantees, which are required when (i) the redemption proceeds are to be sent to someone other than the registered shareholder(s), (ii) the redemption request is for $10,000 or more, or (iii) a share transfer request is made. A Medallion signature guarantee is a special signature guarantee that may be obtained from a domestic bank or trust company, broker, dealer, clearing agency or savings association which is a participant in a Medallion signature guarantee program recognized by the Securities Transfer Association. A Medallion imprint or Medallion stamp indicates that the financial institution is a member of a Medallion signature guarantee program and is an acceptable signature guarantor. The three recognized Medallion signature guarantee programs are Securities Transfer Agent Medallion Program (STAMP), Stock Exchanges Medallion Program (SEMP) and New York Stock Exchange, Inc. Medallion Program (MSP). Signature guarantees which are not a part of these programs will not be accepted. Please note that a notary public stamp or seal is not acceptable; and
· other supporting legal documents, if required, in the case of estates, trusts, guardianships, custodianships, corporations, pension and profit sharing plans and other organizations.
Redemption By Telephone. In order to utilize the telephone redemption option, you must indicate that option on your Account Application. Please note that the telephone redemption option is not available for retirement accounts. You may then initiate a redemption of shares by calling the Transfer Agent at [ ] and requesting that the redemption proceeds be mailed to the primary registration address or wired per the authorized instructions. A wire charge of $7.50 is assessed and charged to the shareholder. If the telephone redemption option is authorized, the Transfer Agent may act on telephone instructions from any person representing himself or herself to be a shareholder and believed by the Transfer Agent to be genuine. The Transfer Agents records of such instructions are binding and shareholders, not the Fund or its Transfer Agent, bear the risk of loss in the event of unauthorized instructions reasonably believed by the Fund or its Transfer Agent to be genuine. The Fund and the Transfer Agent will employ reasonable procedures to confirm that instructions communicated are genuine and, if it does not, it may be liable for any losses due to unauthorized or fraudulent instructions. The procedures employed by the Fund and the Transfer Agent in connection with transactions initiated by telephone include tape recording of telephone instructions and requiring some form of personal identification prior to acting upon instructions received by telephone.
Transaction Fee on Certain Redemptions. The Fund requires the payment of a transaction fee on redemptions of shares held for less than 60 days equal to 1.50% of the NAV of such shares redeemed at the time of redemption. This additional transaction fee is paid to the Fund, not to the Adviser, distributor or Transfer Agent. It is not a sales charge or a contingent deferred sales charge. The fee does not apply to redeemed shares that were purchased through reinvested dividends or capital gains distributions. The purpose of the additional transaction fee is to indirectly allocate transaction costs associated with redemptions to those investors making redemptions after holding their shares for a short period, thus protecting existing shareholders. These costs include: (1) brokerage costs; (2) market impact costs i.e., the decrease in market prices which may result when the Fund sells certain securities in order to raise cash to meet the redemption request; (3) the realization of capital gains by the other shareholders in the Fund; and (4) the effect of the bid-ask spread in the over-the-counter market. The 1.50% amount represents the Funds estimate of the brokerage and other transaction costs which may be incurred by the Fund in disposing of stocks in which the Fund may invest. Without the additional transaction fee, the Fund would generally be selling its shares at a price less than the cost to the Fund of acquiring the portfolio securities necessary to maintain its investment characteristics, resulting in reduced investment performance for all shareholders in the Fund. With the additional transaction fee, the transaction costs of selling additional stocks are not borne by all existing shareholders, but the source of funds for these costs is the transaction fee paid by those investors making redemptions. For purposes of this redemption feature, shares purchased first will be considered to be shares first redeemed.
Other Redemption Information. Redemption proceeds for shares of the Fund recently purchased by check may not be distributed until payment for the purchase has been collected, which may take up to fifteen days from the purchase date. Shareholders can avoid this delay by utilizing the wire purchase option. Redemption proceeds will ordinarily be paid within seven business days after a redemption request is received by the Transfer Agent in good order. The Fund may
suspend the right of redemption or postpone the date at times when the NYSE or the bond market is closed or under any emergency circumstances as determined by the SEC.
If the Companys Board of Directors determines that it would be detrimental to the best interests of the remaining shareholders of the Fund to make payment wholly or partly in cash, redemption proceeds may be paid in whole or in part by an in-kind distribution of readily marketable securities held by the Fund instead of cash in conformity with applicable rules of the SEC. Investors generally will incur brokerage charges on the sale of portfolio securities so received in the payment of redemptions. If a shareholder receives redemption proceeds in-kind, the shareholder will bear the market risk of the securities received in the redemption until their disposition and should expect to incur transaction costs upon the disposition of the securities. The Company has elected, however, to be governed by Rule 18f-1 under the 1940 Act, so that the Fund is obligated to redeem its shares solely in cash up to the lesser of $250,000 or 1% of its NAV during any 90-day period for any one shareholder of the Fund.
Good Order. You must include complete and accurate required information on your redemption request. Please see Redemption of Fund Shares for instructions. Redemption requests not in good order may be delayed.
Involuntary Redemption. The Fund reserves the right to redeem your account at any time the value of the account falls below $500 as the result of a redemption or an exchange request.
You will be notified in writing that the value of your account is less than $500 and will be allowed 30 days to make additional investments before the redemption is processed.
The Fund may assert the right to redeem your shares at current NAV at any time and without prior notice if, and to the extent that, such redemption is necessary to reimburse the Fund for any loss sustained by reason of your failure to make full payment for shares of the Fund you previously purchased or subscribed for.
Dividends and Distributions
The Fund will distribute substantially all of the net investment income and net realized capital gains, if any, of the Fund to the Funds shareholders. All distributions are reinvested in the form of additional full and fractional shares unless you elect otherwise.
The Fund will declare and pay dividends from net investment income quarterly. Net realized capital gains (including net short-term capital gains), if any, will be distributed at least annually.
The ex-dividend, record and payable dates of any annual distribution will be available by calling [ ].
Taxes
The following is a summary of certain United States tax considerations relevant under current law, which may be subject to change in the future. Except where otherwise indicated, the discussion relates to investors who are individual United States citizens or residents. You should consult your tax adviser for further information regarding federal, state, local and/or foreign tax consequences relevant to your specific situation.
Federal Taxes of Distributions. The Fund contemplates distributing as dividends each year all or substantially all of its taxable income, including its net capital gain (the excess of net long-term capital gain over net short-term capital loss). Except as otherwise discussed below, you will be subject to federal income tax on Fund distributions regardless of whether they are paid in cash or reinvested in additional shares. Fund distributions attributable to short-term capital gains and net investment income will generally be taxable to you as ordinary income, except as discussed below.
Distributions attributable to the net capital gain of the Fund will be taxable to you as long-term capital gain, no matter how long you have owned your Fund shares. The maximum long-term capital gain rate applicable to individuals, estates, and trusts is currently 15%. You will be notified annually of the tax status of distributions to you.
Distributions of qualifying dividends will also generally be taxable to you at long-term capital gain rates, as long as certain requirements are met. In general, if 95% or more of the gross income of the Fund (other than net capital gain) consists of dividends received from domestic corporations or qualified foreign corporations (qualifying dividends), then all distributions paid by the Fund to individual shareholders will be taxed at long-term capital gains rates. But if less than 95% of the gross income of the Fund (other than net capital gain) consists of qualifying dividends, then distributions paid by the Fund to individual shareholders will be qualifying dividends only to the extent they are derived from qualifying dividends earned by the Fund. For the lower rates to apply, you must have owned your Fund shares for at least 61 days during the 121-day period beginning on the date that is 60 days before the Funds ex-dividend date (and the Fund will need to have met a similar holding period requirement with respect to the shares of the corporation paying the qualifying dividend). The amount of the Funds distributions that qualify for this favorable treatment may be reduced as a result of the Funds securities lending activities (if any), a high portfolio turnover rate or investments in debt securities or non-qualified foreign corporations.
Distributions from the Fund will generally be taxable to you in the taxable year in which they are paid, with one exception. Distributions declared by the Fund in October, November or December and paid in January of the following year are taxed as though they were paid on December 31.
A portion of distributions paid by the Fund to shareholders that are corporations may also qualify for the dividends-received deduction for corporations, subject to certain holding period requirements and debt financing limitations.
If you purchase shares just before a distribution, the purchase price will reflect the amount of the upcoming distribution, but you will be taxed on the entire amount of the distribution received, even though, as an economic matter, the distribution simply constitutes a return of capital. This is known as buying into a dividend.
Sales and Exchanges. You will generally recognize taxable gain or loss for federal income tax purposes on a sale, exchange or redemption of your shares based on the difference between your tax basis in the shares and the amount you receive for them. Generally, you will recognize long-term capital gain or loss if you have held your Fund shares for over twelve months at the time you dispose of them. (To aid in computing your tax basis, you should retain your account statements for the periods during which you held shares.)
Any loss realized on shares held for six months or less will be treated as a long-term capital loss to the extent of any capital gain dividends that were received on the shares. Additionally, any loss realized on a disposition of shares of the Fund may be disallowed under wash sale rules to the extent the shares disposed of are replaced with other shares of the Fund within a period of 61 days beginning 30 days before and ending 30 days after the shares are disposed of, such as pursuant to a dividend reinvestment in shares of the Fund. If disallowed, the loss will be reflected in an upward adjustment to the basis of the shares acquired.
IRAs and Other Tax-Qualified Plans. The one major exception to the preceding tax principles is that distributions on, and sales, exchanges and redemptions of, shares held in an IRA (or other tax-qualified plan) will not be currently taxable.
Backup Withholding. The Fund may be required in certain cases to withhold and remit to the U.S. Treasury a percentage of taxable dividends or gross proceeds realized upon sale payable to shareholders who have failed to provide a correct tax identification number in the manner required, or who are subject to withholding by the Internal Revenue Service for failure to properly include on their return payments of taxable interest or dividends, or who have failed to certify to the Fund that they are not subject to backup withholding when required to do so or that they are exempt recipients. The current withholding rate is 28%.
U.S. Tax Treatment of Foreign Shareholders. For nonresident aliens, foreign corporations and other foreign investors, Fund distributions attributable to net long-term capital gains of the Fund will generally be exempt from U.S. tax, but all other Fund distributions will generally be subject to a 30% withholding tax. The withholding tax may, however, be reduced (and, in some cases, eliminated) under an applicable tax treaty between the United States and a shareholders country of residence or incorporation, provided that the shareholder furnishes the Fund with a properly completed Form W-8BEN to establish entitlement for these treaty benefits.
Foreign shareholders will generally not be subject to U.S. tax on gains realized on sale, exchange or redemption of shares in the Fund.
Different U.S. tax rules may apply to a foreign shareholder, however, if the investment in the Fund is connected to a trade or business of the shareholder in the United States or the investor is present in the United States for 183 days or more in a year.
All foreign investors should consult their own tax advisors regarding the tax consequences in their country of residence of an investment in the Fund.
State and Local Taxes. You may also be subject to state and local taxes on income and gain from Fund shares. State income taxes may not apply, however, to the portions of the Funds distributions, if any, that are attributable to interest on U.S. government securities. You should consult your tax adviser regarding the tax status of distributions in your state and locality.
Future Tax Treatment . Some of the tax provisions described above are subject to sunset provisions. Specifically, a sunset provision provides that the 15% long-term capital gain rate and the taxation of dividends at the long-term capital gain rate will change after 2012.
More information about taxes is contained in the Funds SAI.
Multi-Class Structure
The Fund also offers Class A shares and Retail shares through separate prospectuses. Class A shares are offered directly to individual investors and are subject to a front-end sales charge and distribution fees. Retail shares are offered directly to individual investors without the imposition of sales charges but are subject to distribution fees. Shares of each class of the Fund represent equal pro rata interests in the Fund and accrue dividends and calculate NAV and performance quotations in the same manner. The performance of each class is quoted separately due to different actual expenses. The total return on Class I shares of the Fund can be expected to differ from the total return on Class A shares or Retail shares of the Fund. Information concerning other classes of the Fund can be requested by calling the Fund at [ ].
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS OR IN THE FUNDS SAI 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 THE COMPANY OR ITS DISTRIBUTOR. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING BY THE COMPANY OR BY THE DISTRIBUTOR IN ANY JURISDICTION IN WHICH SUCH OFFERING MAY NOT LAWFULLY BE MADE.
Appendix A
Prior Performance of Similarly Advised Accounts
The Adviser has experience in managing other accounts with substantially similar investment objectives, policies and strategies as the Fund. The table below is provided to illustrate the past performance of the Adviser in managing all its other similarly advised accounts and does not represent the performance of the Fund. Investors should not consider this performance information as a substitute for the performance of the Fund, nor should investors consider this information as an indication of the future performance of the Fund or of the Adviser. This performance history is net of all fees (including any applicable sales loads) charged to investors in the other accounts. The net returns are derived using the investment advisory fixed rate fee of 1.00% on total assets applicable for each other account and calculated on a monthly basis. The composite includes other accounts that pay lower expenses than those paid by shareholders of the Fund. Higher expenses reduce returns to investors. The use of the Funds expense structure would have lowered the performance results. The Funds results in the future also may be different because the other accounts are not subject to certain investment limitations, diversification requirements and other restrictions imposed on mutual funds under applicable U.S. securities and tax laws that, if applicable, could have adversely affected the performance of the other accounts. In addition, the securities held by the Fund will not be identical to the securities held by the other accounts.
The performance of the other accounts is also compared to the performance of an appropriate broad-based securities benchmark index. This index is unmanaged and is not subject to fees and expenses typically associated with managed funds, including the Fund. Investors cannot invest directly in the Index. The performance information is accompanied by additional disclosures, which are an integral part of the information.
COMPOSITE MONTHLY PERFORMANCE TABLE NET OF FEES
(SINCE INCEPTION JANUARY 14, 2011)(1),(2),(3)
|
|
Jan |
|
Feb |
|
Mar |
|
Apr |
|
May |
|
Jun |
|
Jul |
|
Aug |
|
Sep |
|
Oct |
|
Nov |
|
Dec |
|
US Equity Low Volatility Composite |
|
-1.72 |
% |
1.92 |
% |
1.97 |
% |
4.13 |
% |
0.71 |
% |
0.11 |
% |
-2.82 |
% |
-1.63 |
% |
-2.17 |
% |
4.80 |
% |
0.41 |
% |
|
|
S&P 500 ® Index |
|
-0.55 |
% |
3.20 |
% |
-0.10 |
% |
2.85 |
% |
-1.35 |
% |
-1.83 |
% |
-2.15 |
% |
-5.68 |
% |
-7.18 |
% |
10.77 |
% |
-0.51 |
% |
|
|
(1) Performance was calculated using Global Investment Performance Standards (GIPS). This method of calculating performance differs from the SECs standardized methodology, which may produce different results.
(2) Performance shown is composite performance of all similarly advised accounts. The first similarly advised account commenced operations on January 14, 2011, but other accounts commenced operations subsequent to January 14, 2011.
(3) The S&P 500 ® Index is an unmanaged index composed of 500 common stocks, classified in eleven industry sectors, which represents approximately 75% of the U.S. equities market. The S&P 500 ® Index assigns relative values to the stocks included in the index, weighted according to each stocks total market value relative to the total market value of the other stocks included in the index.
THE SUMMIT GLOBAL INVESTMENTS U.S. LOW VOLATILITY EQUITY FUND
FOR MORE INFORMATION:
This prospectus contains important information you should know before you invest. Read it carefully and keep it for future reference. More information about the Fund is available free of charge, upon request, including:
Annual/Semi-Annual Reports
These reports contain additional information about the Funds investments, describe the Funds performance, list portfolio holdings, and discuss recent market conditions and economic trends. The annual report includes Fund strategies and market conditions that significantly affected the Funds performance during its last fiscal year.
Statement of Additional Information
An SAI, dated [March 1, 2012], has been filed with the SEC. The SAI, which includes additional information about the Fund, along with the Funds annual and semi-annual reports, when available, are available on [the Advisers website at www.summitglobalinvestments.com or may be obtained free of charge by calling [ ]. The SAI, as supplemented from time to time, is incorporated by reference into this prospectus and is legally considered a part of this prospectus.
Shareholder Account Service Representatives
Representatives are available to discuss account balance information, mutual fund prospectuses, literature, programs and services available. Hours: 8 a.m. to 6 p.m. (Eastern time) Monday-Friday. Call: [ ].
Purchases and Redemptions
Call your registered representative or [ ].
Written Correspondence
Post Office Address: |
|
Summit Global Investments U.S. Low Volatility Equity Fund c/o BNY Mellon Investment Servicing (US) Inc. PO Box [ ] Providence, RI 02940 |
Street Address: |
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Summit Global Investments U.S. Low Volatility Equity Fund c/o BNY Mellon Investment Servicing (US) Inc. 4400 Computer Drive Westborough, MA 01581 |
Securities and Exchange Commission
You may view and copy information about the Company and the Fund, including the SAI, by visiting the SECs Public Reference Room in Washington, D.C. or the EDGAR Database on the SECs Internet site at www.sec.gov. You may also obtain copies of Fund documents by paying a duplicating fee and sending an electronic request to the following e-mail address: publicinfo@sec.gov, or by sending your written request and a duplicating fee to the SECs Public Reference Section, Washington, D.C. 20549-1520. You may obtain information on the operation of the public reference room by calling the SEC at (202) 551-8090.
INVESTMENT COMPANY ACT FILE NO. 811-05518
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS
SUMMIT GLOBAL INVESTMENTS
U.S. LOW VOLATILITY EQUITY FUND
Class A Shares
TICKER: [ ]
of The RBB Fund, Inc.
This prospectus gives vital information about the Summit Global Investments U.S. Low Volatility Equity Fund (the Fund), an investment portfolio of The RBB Fund, Inc. (the Company), including information on investment policies, risks and fees. For your own benefit and protection, please read it before you invest and keep it on hand for future reference.
PROSPECTUS
[March 1, 2012]
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
THE SECURITIES DESCRIBED IN THIS PROSPECTUS HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION (SEC). THE SEC, HOWEVER, HAS NOT JUDGED THESE SECURITIES FOR THEIR INVESTMENT MERIT AND HAS NOT DETERMINED THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANYONE WHO TELLS YOU OTHERWISE IS COMMITTING A CRIMINAL OFFENSE.
TABLE OF CONTENTS
A look at the goals, strategies, risks and financial history of the Fund. |
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SUMMARY SECTION |
1 |
|
|
Investment Objective |
1 |
|
|
Expenses and Fees |
1 |
|
|
Risk/Return Information |
2 |
|
|
Management of the Fund |
2 |
|
|
Purchase and Sale of Fund Shares |
2 |
|
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Tax Information |
3 |
|
|
Payments to Broker-Dealers and Other Financial Intermediaries |
3 |
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ADDTIONAL INFORMATION ON THE FUNDS INVESTMENT OBJECTIVE AND PRINCIPAL STRATEGIES |
4 |
|
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ADDITIONAL INFORMATION ON RISKS OF INVESTING IN THE FUND |
4 |
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Details about the Funds service providers. |
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MANAGEMENT OF THE FUND |
6 |
|
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Investment Adviser |
6 |
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Portfolio Manager |
6 |
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Other Service Providers |
7 |
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Policies and instructions for opening, maintaining and closing an account in the Fund. |
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SHAREHOLDER INFORMATION |
8 |
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Pricing of Fund Shares |
8 |
|
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Sales Charges |
8 |
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Market Timing |
10 |
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Purchase of Fund Shares |
10 |
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|
Redemption of Fund Shares |
13 |
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Dividends and Distributions |
14 |
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|
Taxes |
14 |
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Appendix A Prior Performance of Similarly Advised Accounts |
17 |
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FOR MORE INFORMATION |
Back Cover |
SUMMARY SECTION
Investment Objective
The Summit Global Investments U.S. Low Volatility Equity Fund (the Fund) seeks to outperform the S&P 500 ® Index over a market cycle while significantly reducing the overall volatility of its portfolio through quantitative and fundamental stock selection. There can be no guarantee that the Fund will achieve its investment objective.
Expenses and Fees
This table describes the fees and expenses that you may pay if you buy and hold Class A shares of the Fund. You may qualify for sales charge discounts if you invest, or agree to invest in the future, at least $50,000 in the Fund. More information about these and other discounts is available from your financial professional, in the section of the Prospectus entitled Shareholder Information- Sales Charges and in the section of the Funds Statement of Additional Information (SAI) entitled Purchase and Redemption Information - Reducing or Eliminating the Front-End Sales Charge.
|
|
Class A |
|
Shareholder Fees (fees paid directly from your investment) |
|
|
|
|
|
|
|
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) |
|
5.25 |
% |
Maximum Deferred Sales Charge (Load) |
|
None |
|
Maximum Sales Charge (Load) Imposed on Reinvested Dividends |
|
None |
|
Redemption Fee (as a percentage of amount redeemed on shares held for less than 60 days, if applicable) |
|
1.50 |
% |
Exchange Fee (as a percentage of amount redeemed on shares held for less than 60 days, if applicable) |
|
1.50 |
% |
|
|
|
|
Annual Fund Operating Expenses (expenses that that you pay each year as a percentage of the value of your investment) |
|
|
|
|
|
|
|
Management Fees |
|
0.70 |
% |
Distribution (12b-1) Fees |
|
0.25 |
% |
Other Expenses (1) |
|
0.98 |
% |
|
|
|
|
Total Annual Fund Operating Expenses |
|
1.93 |
% |
|
|
|
|
Fee Waivers and Expense Reimbursements (2) |
|
0.70 |
% |
|
|
|
|
Net Expenses |
|
1.23 |
% |
(1) Other expenses are based on estimated amounts for the current fiscal year.
(2) The Funds investment adviser has contractually agreed to waive management fees and reimburse expenses through [March 1, 2013], to the extent that Total Annual Fund Operating Expenses (excluding acquired fund fees and expenses, brokerage commissions, extraordinary items, interest and taxes) exceed 1.23%.
Example:
This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Funds operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
1 Year |
|
3 Years |
|
||
$ |
644 |
|
$ |
1,035 |
|
Portfolio Turnover
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover rate may indicate higher transactions costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the example, affect the Funds performance.
Principal Investment Strategies
Under normal circumstances, the Fund will invest at least 80% of its net assets (including borrowings for investment purposes) in equity securities, primarily common stocks, of U.S. companies. The Funds investment adviser attempts to lower the Funds market risk by investing in U.S. equity securities that lower the overall volatility of the Funds portfolio as compared to the S&P 500 ® Index. The Fund invests in stocks that exhibit less volatile stock price patterns, strengthening business metrics and quantitative factors that the Funds investment adviser anticipates will produce less volatility with more capital protection and more consistent returns.
Principal Risks
· Common Stock Risk. Investments in common stocks are subject to market, economic and business risks that will cause their price to fluctuate over time. Therefore, an investment in the Fund may be more suitable for long-term investors who can bear the risk of these fluctuations.
· Management Risk. The Fund is subject to the risk of poor management stock selection. In other words, the individual stocks in the Fund may not perform as well as expected, and/or the Funds portfolio management practices do not work to achieve their desired result.
· Market Risk. The net asset value (NAV) of the Fund will change with changes in the market value of its portfolio positions. Investors may lose money. Although the Fund will invest in stocks the Funds investment adviser believes will produce less volatility, there is no guarantee that the stocks will perform as expected.
· Opportunity Risk. As with all mutual funds, the Fund is subject to the risk of missing out on an opportunity because the assets necessary to take advantage of it are tied up in less advantageous investments.
Performance Information
No performance information is available for the Fund because it had not commenced operations as of the date of this Prospectus. The Fund intends to evaluate its performance as compared to that of the S&P 500 ® Index.
Management of the Fund
Investment Adviser
Summit Global Investments, LLC
Portfolio Manager
David Harden
President of the Investment Adviser
Portfolio Manager of the Fund since inception
Purchase and Sale of Fund Shares
Minimum Initial Investment
$2,500
Shares of the Fund may be available through certain brokerage firms, financial institutions and other industry professionals (collectively, Service Organizations). Certain features, such as the initial and subsequent investment minimums and certain trading restrictions, may be modified or waived by Service Organizations. Service Organizations may impose transaction or administrative charges or other direct fees, which charges and fees would not be imposed if shares are purchased directly from The RBB Fund, Inc. The Fund may accept initial investments of smaller amounts in its sole discretion.
You can only purchase and redeem shares of the Fund on days the New York Stock Exchange (NYSE) is open and through the means described below.
Purchase and Redemption By Mail:
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
P.O. Box [ ]
Providence, RI 02940-8042
Overnight Mail:
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
4400 Computer Drive
Westborough, MA 01581
Purchase and Redemption By Wire:
[ ]
ABA# [ ]
Account # [ ]
F/B/O Summit Global Investments U.S. Low Volatility Equity Fund
Ref. (Shareholder Name; Account Number)
Redemption By Telephone: If you select the option on your account application, you may call the Funds transfer agent at [ ].
Tax Information
The Fund intends to make distributions that may be taxed as ordinary income or capital gains. The Fund contemplates declaring as dividends each year all or substantially all of its taxable income.
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediarys website for more information.
ADDITIONAL INFORMATION ABOUT THE FUNDS INVESTMENTS AND RISKS
This section provides some additional information about the Funds investments and certain portfolio management techniques that the Fund may use. More information about the Funds investments and portfolio management techniques, some of which entail risks, is included in the Statement of Additional Information (SAI).
Investment Objective
The Funds investment objective may be changed by the Board of Directors of The RBB Fund, Inc. (the Company) without shareholder approval. Shareholders will, however, receive 60 days prior notice of any changes. Any such changes may result in the Fund having an investment objective different from the objective that the shareholder considered appropriate at the time of investment in the Fund.
Additional Information About the Funds Investment Strategies
Other Investment Companies. The Fund may invest up to 10% of its total assets in the securities of other investment companies not affiliated with the Adviser, but may not invest more than 5% of its total assets in the securities of any one investment company or acquire more than 3% of the voting securities of any other investment company. Among other things, the Fund may invest in money market mutual funds for cash management purposes by sweeping excess cash balances into such funds until the cash is invested or otherwise utilized. Rule 12d1-1 under the Investment Company Act of 1940, as amended, permits the Fund to invest an unlimited amount of its uninvested cash in a money market fund so long as, among other things, said investment is consistent with the Funds investment objectives and policies. The Fund will indirectly bear its proportionate share of any management fees and other expenses paid by investment companies in which it invests in addition to the advisory and administration fees paid by the Fund.
Securities Lending. The Fund may seek to increase its income by lending portfolio securities to institutions, such as certain broker-dealers. Portfolio securities loans are secured continuously by collateral maintained on a current basis at an amount at least equal to the market value of the securities loaned. The value of the securities loaned by the Fund will not exceed 331/3% of the value of the Funds total assets. The Fund may experience a loss or delay in the recovery of its securities if the borrowing institution breaches its agreement with the Fund. Lending the Funds portfolio securities involves the risk of delay in receiving additional collateral if the value of the securities goes up while they are on loan.
Borrowing. The Fund may borrow money for temporary or emergency (not leveraging) purposes. The Fund will not make any additional investments while borrowings exceed 5% of its total assets.
Temporary Investments. The Fund may depart from its principal investment strategy in response to adverse market, economic, political or other conditions by taking a temporary defensive position (up to 100% of its assets) in all types of money market and short-term debt securities. If the Fund were to take a temporary defensive position, it may be unable for a time to achieve its investment objective.
Additional Information About the Funds Risks
The following provides additional information about the risks of investing in the Fund:
· At least 80% of the Funds net assets will be invested under normal circumstances in equity securities, and the net asset value of the Fund will vary with changes in the market value of the portfolio positions. The Fund will provide shareholders with at least 60 days prior written notice of any change in this 80% policy.
· The market value of a portfolio holding may fluctuate, sometimes rapidly and unpredictably. The prices of equity securities change in response to many factors including the historical and prospective earnings of the issuer, the value of its assets, general economic conditions, interest rates, investor perceptions and market liquidity. Decreases in market value of the Funds portfolio securities could adversely affect the Funds net asset value.
· The Fund may, for temporary defensive purposes, invest a percentage of its total assets, without limitation, in cash or various money market instruments. The value of money market instruments tends to fall when current interest rates rise. Money market instruments are generally less sensitive to interest rate changes than longer-term securities. When the Funds assets are invested in cash or money market instruments, the Fund may not achieve its investment goal.
Disclosure of Portfolio Holdings
A description of the Companys policies and procedures with respect to the disclosure of the Funds portfolio securities is available in the Funds SAI.
MANAGEMENT OF THE FUND
Investment Adviser
Summit Global Investments, LLC (the Adviser) serves as the Funds investment adviser. The Advisers principal address is 189 North, Hwy 89, Suite 144, North Salt Lake, Utah 84054. The Adviser provides investment management and investment advisory services to investment companies and other institutional accounts.. The Adviser is 100% employee-owned, and was founded in 2010.
Pursuant to an investment advisory agreement with the Company, the Adviser is entitled to an advisory fee computed daily and payable monthly at the annual rate of 0.70% of the Funds average daily net assets. The Adviser has contractually agreed to waive its management fees and reimburse expenses through [March 1, 2013], to the extent that the Funds total annual operating expenses (excluding acquired fund fees and expenses, brokerage commissions, extraordinary items, interest and taxes) exceed 1.23%.
A discussion regarding the basis for the Companys Board of Directors approving the Funds investment advisory agreement with the Adviser will be available in the Funds first report to shareholders.
Portfolio Manager
The President of the Adviser, David Harden, is primarily responsible for the day-to-day management of the Funds investment portfolio. Mr. Harden founded the Adviser in 2010, and has managed the Fund since its inception. He started his career in 1993 and has worked for such firms as Fidelity Investments, Wellington Management and Evergreen Investments. From 2006 to 2011, Mr. Harden has worked with Ensign Peak Advisors, Inc., most recently as Vice President and Senior Portfolio Manager, where he managed and oversaw day-to-day research, portfolio management and trading for all index, quantitative and low volatility strategies.
The SAI provides additional information about the portfolio managers compensation, other accounts managed by the portfolio manager and the portfolio managers ownership of securities in the Fund.
Other Service Providers
The following chart shows the Funds service providers and includes their addresses and principal activities.
SHAREHOLDER INFORMATION
Pricing of Fund Shares
Class A Shares of the Fund are sold at their net asset value (NAV) plus a front-end sales charge, if applicable. The NAV of Class A Shares of the Fund is calculated as follows:
NAV = |
Value of Assets Attributable to Class A Shares of the Fund |
|
|
|
|
Value of Liabilities Attributable Class A Shares of the Fund |
|
|
Number of Outstanding Class A Shares of the Fund |
|
The Funds NAV is calculated once daily at the close of regular trading hours on the New York Stock Exchange (NYSE) (generally 4:00 p.m. Eastern time) on each day the NYSE is open. The NYSE is generally open Monday through Friday, except national holidays. The Fund will effect purchases and redemptions of Fund shares at the NAV next calculated after receipt of your order or request in good order.
The Funds equity securities listed on any national or foreign exchange market system will be valued at the last sale price, except for the National Association of Securities Dealers Automatic Quotation System (NASDAQ). Equity securities listed on NASDAQ will be valued at the official closing price. Equity securities traded in the over-the-counter market are valued at their closing prices. If there were no transactions on that day, securities traded principally on an exchange or on NASDAQ will be valued at the mean of the last bid and ask prices prior to the market close. Fixed income securities having a remaining maturity of 60 days or less are valued at amortized cost, which approximates market value. Fixed income securities having a remaining maturity of greater than 60 days are valued using an independent pricing service. When prices are not available from such services or are deemed to be unreliable, securities may be valued by dealers who make markets in such securities.
If market quotations are unavailable or deemed unreliable by the Funds administrator, in consultation with the Adviser, securities will be valued in accordance with procedures adopted by the Companys Board of Directors and under the Board of Directors ultimate supervision. Relying on prices supplied by pricing services or dealers or using fair valuation involves the risk that the values used by a Fund to price its investments may be higher or lower than the values used by other investment companies and investors to price the same investments.
Investments in other open-end investment companies are valued based on the NAV of those investment companies (which may use fair value pricing as discussed in their prospectuses).
Sales Charges
General. Purchases of the Funds shares are subject to a front-end sales charge of up to five and one-quarter percent (5.25%) of the total purchase price; however, sales charges may be reduced for large purchases as indicated below. Sales charges are not imposed on shares that are purchased with reinvested dividends or other distributions. The table below indicates the front-end sales charge as a percentage of both the offering price and the net amount invested. The term offering price includes the front-end sales charge.
Amount of Purchase |
|
Sales Charge as a
|
|
Commission as a
|
|
Less than $50,000 |
|
5.25 |
% |
4.75 |
% |
At least $50,000 but less than $100,000 |
|
4.75 |
% |
4.25 |
% |
At least $100,000 but less than $250,000 |
|
3.50 |
% |
3.25 |
% |
At least $250,000 but less than $500,000 |
|
2.50 |
% |
2.25 |
% |
At least $500,000 but less than $750,000 |
|
2.00 |
% |
1.90 |
% |
At least $750,000 but less than $1,000,000 |
|
1.50 |
% |
1.45 |
% |
$1,000,000 or greater |
|
None |
|
|
** |
**No sales charge is payable at the time of purchase on investments of $1,000,000 or more; however, a 1% contingent deferred sales charge is imposed in the event of redemption within 18 months following any such purchase. See the section entitled Contingent Deferred Sales Charge on Certain Redemptions. The Funds distributor may pay a commission at the rate of 1% to certain brokerage firms, financial institutions and other industry professionals, including
affiliates of the Adviser (collectively, Service Organizations), who initiate and are responsible for purchases of $1,000,000 or more.
Combined Purchase Privilege. Certain purchases of Fund shares made at the same time by you, your spouse and your children under age 25 may be combined for purposes of determining the Amount of Purchase. The combined purchase privilege may also apply to certain employee benefit plans and trust estates. The following purchases may be combined for purposes of determining the Amount of Purchase: (a) individual purchases, if made at the same time, by a single purchaser, the purchasers spouse and children under the age of 25 purchasing shares for their own accounts, including shares purchased by a qualified retirement plan(s) exclusively for the benefit of such individual(s) (such as an IRA, individual-type section 403(b) plan or single-participant Keogh-type plan) or by a Company, as defined in Section 2(a)(8) of the Investment Company Act of 1940, as amended (the 1940 Act), solely controlled, as defined in the 1940 Act, by such individual(s), or (b) individual purchases by trustees or other fiduciaries purchasing shares (i) for a single trust estate or a single fiduciary account, including an employee benefit plan, or (ii) concurrently by two or more employee benefit plans of a single employer or of employers affiliated with each other in accordance with Section 2(a)(3)(c) of the 1940 Act (excluding in either case an employee benefit plan described in (a) above), provided such trustees or other fiduciaries purchase shares in a single payment. Purchases made for nominee or street name accounts may not be combined with purchases made for such other accounts. You may also further discuss the combined purchase privilege with your investment broker or other Service Organization. In order to take advantage of the combined purchase privilege, the purchases combined must be brought to the attention of your investment broker or other Service Organization at the time of your purchase.
Cumulative Quantity Discount. You may combine the value of shares held in the Fund, along with the dollar amount of shares being purchased, to qualify for a cumulative quantity discount. The value of shares held is the higher of their cost or current net asset value. For example, if you hold shares having a value of $225,000 and purchase $25,000 of additional shares, the sales charge applicable to the additional investment would be 2.50%, the rate applicable to a single purchase of $250,000. In order to receive the cumulative quantity discount, the value of shares held must be brought to the attention of your investment broker or other Service Organization at the time of your purchase.
Letter of Intent. If you anticipate purchasing at least $50,000 of shares within a 13-month period, the shares may be purchased at a reduced sales charge by completing and returning a Letter of Intent (the Letter), which can be provided to you by your investment broker or other Service Organization. The reduced sales charge may also be obtained on shares purchased within the 90 days prior to the date of receipt of the Letter. Shares purchased under the Letter are eligible for the same reduced sales charge that would have been available had all the shares been purchased at the same time. There is no obligation to purchase the full amount of shares indicated in the Letter. Should you invest more or less than indicated in the Letter during the 13-month period, the sales charge will be recalculated based on the actual amount purchased. A portion of the amount of the intended purchase normally will be held in escrow in the form of Fund shares pending completion of the intended purchase.
Sales Charge Waivers. The Fund sells shares at net asset value without imposition of a sales charge to the following persons:
· current and retired (as determined by the Adviser) employees of the Adviser and its affiliates, their spouses and children under the age of 25 and employee benefit plans for such employees, provided orders for such purchases are placed by the employee;
· any other investment company in connection with the combination of such company with the Fund by merger, acquisition of assets or otherwise;
· Directors of the Company and registered representatives of Service Organizations;
· existing advisory clients of the Adviser on purchases effected by transferring all or a portion of their investment management or trust account to the Fund, provided that such account had been maintained for a period of six months prior to the date of purchase of Fund shares;
· trust companies, bank trust departments and registered investment advisers purchasing for accounts over which they exercise investment authority and which are held in a fiduciary, agency, advisory, custodial or similar capacity, provided that the amount collectively invested or to be invested in the Fund by such entity or adviser during the subsequent 13-month period totals at least $50,000;
· employer-sponsored retirement plans with assets of at least $50,000 or 25 or more eligible participants; and
· accounts established under a fee-based program sponsored and maintained by a registered broker-dealer or other financial intermediary and approved by the Distributor.
In order to take advantage of a sales charge waiver, a purchaser must certify to the Service Organization eligibility for a waiver and must notify the Service Organization whenever eligibility for a waiver ceases to exist. A Service Organization reserves the right to request additional information from a purchaser in order to verify that such purchaser is so eligible. Such information may include account statements or other records regarding shares of the Fund held by you or your immediate family household members.
Contingent Deferred Sales Charge on Certain Redemptions . Purchases of $1,000,000 or more are not subject to an initial sales charge; however, a contingent deferred sales charge is payable on these investments in the event of a share redemption within 18 months following the share purchase, at the rate of 1% of the lesser of the value of the shares redeemed (exclusive of reinvested dividends and capital gain distributions) or the total cost of such shares. In determining whether a contingent deferred sales charge is payable, and the amount of the charge, it is assumed that shares purchased with reinvested dividends and capital gain distributions and then other shares held the longest are the first redeemed. The contingent deferred sales charge is further discussed in the SAI.
Market Timing
In accordance with the policy adopted by the Companys Board of Directors, the Company discourages and does not accommodate market timing and other excessive trading practices. Purchases should be made with a view to longer-term investment only. Excessive short-term (market timing) trading practices may disrupt portfolio management strategies, increase brokerage and administrative costs, harm Fund performance and result in dilution in the value of Fund shares held by long-term shareholders. The Company and the Adviser reserve the right to (i) reject a purchase or exchange order, (ii) delay payment of immediate cash redemption proceeds for up to seven calendar days, (iii) revoke a shareholders privilege to purchase Fund shares (including exchanges), or (iv) limit the amount of any exchange. An investor may receive notice that their purchase order or exchange has been rejected after the day the order is placed or after acceptance by a financial intermediary. . The Company and the Adviser will not be liable for any loss resulting from rejected purchase orders. To minimize harm to the Company and its shareholders (or the Adviser), the Company (or the Adviser) will exercise their right if, in the Companys (or the Advisers) judgment, an investor has a history of excessive trading or if an investors trading, in the judgment of the Company or the Adviser, has been or may be disruptive to the Fund. No waivers of the provisions of the policy established to detect and deter market timing and other excessive trading activity are permitted that would harm the Fund and its shareholders or would subordinate the interests of the Fund and its shareholders to those of the Adviser or any affiliated person or associated person of the Adviser.
To deter excessive shareholder trading, the Fund charges a redemption fee of 1.50% on shares redeemed within 60 days of purchase. For further information on redemptions, please see the section entitled Shareholder Information Redemptions of Fund Shares.
There is no assurance that the Adviser will be able to identify market timers, particularly if they are investing through intermediaries.
If necessary, the Company may prohibit additional purchases of Fund shares by a financial intermediary or by certain customers of the financial intermediary. Financial intermediaries may also monitor their customers trading activities in the Fund. The criteria used by intermediaries to monitor for excessive trading may differ from the criteria used by the Company. If a financial intermediary fails to enforce the Companys excessive trading policies, the Company may take certain actions, including terminating the relationship.
Purchase of Fund Shares
Shares representing interests in the Fund are offered continuously for sale by BNY Mellon Distributors Inc. (the Distributor). The Board of Directors has approved a Distribution Agreement and adopted a Plan of Distribution for Class A shares (the Plan) pursuant to Rule 12b-1 under the 1940 Act. Under the Plan, the Distributor is entitled to receive from the Fund a distribution fee with respect to Class A shares of the Fund, which is accrued daily and paid monthly, of up to 0.25% on an annualized basis of the average daily net assets of the Class A shares. The actual amount of such compensation under the Plan is agreed upon by the Companys Board of Directors and by the Distributor. Because these fees are paid out of the Funds assets on an ongoing basis, over time these fees will increase the cost of your investment and may cost you more than paying other types of sales charges.
Amounts paid to the Distributor under the Plan may be used by the Distributor to cover expenses that are related to (i) the sale of Class A shares, (ii) ongoing servicing and/or maintenance of the accounts of Class A shareholders, and (iii) sub-transfer agency services, subaccounting services or administrative services related to the sale of Class A shares, all as set forth in the Plan. Ongoing servicing and/or maintenance of the accounts of Class A shareholders may include updating and mailing prospectuses and shareholder reports, responding to inquiries regarding shareholder accounts and acting as agent or intermediary between
shareholders and the Fund or its service providers. The Distributor may delegate some or all of these functions to Service Organizations. See Purchases Through Intermediaries below.
The Plan obligates the Fund, during the period it is in effect, to accrue and pay to the Distributor on behalf of the Class A shares the fee agreed to under the Distribution Agreement. Payments under the Plan are not tied exclusively to expenses actually incurred by the Distributor, and the payments may exceed distribution expenses actually incurred.
Purchases Through Intermediaries. Class A shares of the Fund may also be available through Service Organizations. Certain features of the shares, such as the initial and subsequent investment minimums and certain trading restrictions, may be modified or waived by Service Organizations. Service Organizations may impose transaction or administrative charges or other direct fees, which charges and fees would not be imposed if shares are purchased directly from the Company. Therefore, you should contact the Service Organization acting on your behalf concerning the fees (if any) charged in connection with a purchase or redemption of shares and should read this Prospectus in light of the terms governing your accounts with the Service Organization. Service Organizations will be responsible for promptly transmitting client or customer purchase and redemption orders to the Company in accordance with their agreements with the Company or its agent and with clients or customers. Service Organizations or, if applicable, their designees that have entered into agreements with the Company or its agent may enter confirmed purchase orders on behalf of clients and customers, with payment to follow no later than the Companys pricing on the following Business Day. If payment is not received by such time, the Service Organization could be held liable for resulting fees or losses. The Company will be deemed to have received a purchase or redemption order when a Service Organization, or, if applicable, its authorized designee, accepts a purchase or redemption order in good order if the order is actually received by the Company in good order not later than the next business morning. If a purchase order is not received by the Fund in good order, BNY Mellon Investment Servicing (US) Inc. (the Transfer Agent) will contact the financial intermediary to determine the status of the purchase order. Orders received by the Company in good order will be priced at the appropriate Funds NAV next computed after they are deemed to have been received by the Service Organization or its authorized designee.
The Company relies upon the integrity of Service Organizations to ensure that orders are timely and properly submitted. The Fund cannot assure you that a Service Organization properly submitted to it all purchase and redemption orders received from the Service Organizations customers before the time for determination of the Funds NAV in order to obtain that days price.
For administration, subaccounting, transfer agency and/or other services, the Adviser, the Distributor or their affiliates may pay Service Organizations and certain recordkeeping organizations a fee (the Service Fee) relating to the average annual NAV of accounts with the Company maintained by such Service Organizations or recordkeepers. The Service Fee payable to any one Service Organization is determined based upon a number of factors, including the nature and quality of services provided, the operations processing requirements of the relationship and the standardized fee schedule of the Service Organization or recordkeeper.
General. You may also purchase Class A shares of the Fund at the NAV per share next calculated after your order is received by the Transfer Agent in good order as described below. The Funds NAV is calculated once daily at the close of regular trading hours on the NYSE (generally 4:00 p.m. Eastern time) on each day the NYSE is open. After an initial purchase is made, the Transfer Agent will set up an account for you on the Companys records. The minimum initial investment in the Fund is $2,500 and there is no minimum subsequent investment amount. The minimum initial investment requirements may be reduced or waived from time to time. For purposes of meeting the minimum initial purchase, purchases by clients which are part of endowments, foundations or other related groups may be combined. You can only purchase shares of the Fund on days the NYSE is open and through the means described below. Shares may be purchased by principals and employees of the Adviser and its subsidiaries and by their spouses and children either directly or through any trust that has the principal, employee, spouse or child as the primary beneficiaries, their individual retirement accounts, or any pension and profit-sharing plan of the Adviser and its subsidiaries without being subject to the minimum investment limitations.
Initial Investment By Mail. Subject to acceptance by the Fund, an account may be opened by completing and signing an Account Application and mailing it to the Fund at the address noted below, together with a check payable to Summit Global Investments U.S. Low Volatility Equity Fund. Third party endorsed checks or foreign checks will not be accepted.
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
P.O. Box [ ]
Providence, RI 02940
or overnight to:
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
4400 Computer Drive
Westborough, MA 01581
Subject to acceptance by the Fund, payment for the purchase of shares received by mail will be credited to a shareholders account at the NAV per share of the Fund next determined after receipt of payment in good order.
Initial Investment By Wire. Subject to acceptance by the Fund, Class A shares may be purchased by wiring federal funds to [ ] (see instructions below). A completed Account Application must be forwarded to the Transfer Agent at the address noted above under Initial Investment by Mail in advance of the wire. Notification must be given to the Transfer Agent at (888) 520-3277 prior to 4:00 p.m., Eastern time, on the wire date. (Prior notification must also be received from investors with existing accounts.) Funds should be wired to:
Federal funds wire purchases will be accepted only on days when the Fund and [ ] are open for business.
Additional Investments. Additional investments may be made at any time by purchasing shares at the NAV per share of the Fund by mailing a check to the Transfer Agent at the address noted above under Initial Investment by Mail (payable to Summit Global Investments U.S. Low Volatility Equity Fund) or by wiring monies to the custodian bank as outlined above under Initial Investment by Wire. Notification must be given to the Transfer Agent at [ ] prior to 4:00 p.m., Eastern time, on the wire date. Initial and additional purchases made by check cannot be redeemed until payment of the purchase has been collected, which may take up to fifteen calendar days from the purchase date.
Retirement Plans/IRA Accounts. A $15.00 retirement custodial maintenance fee is charged per IRA account per year. For further information as to applications and annual fees, contact the Transfer Agent at [ ]. To determine whether the benefits of an IRA are available and/or appropriate, you should consult with a tax advisor.
Other Purchase Information. The Company reserves the right, in its sole discretion, to suspend the offering of shares or to reject purchase orders when, in the judgment of management, such suspension or rejection is in the best interest of the Fund. The Adviser will monitor the Funds total assets and may, subject to Board approval, decide to close the Fund at any time to new investments or to new accounts due to concerns that a significant increase in the size of the Fund may adversely affect the implementation of the Funds strategy. The Adviser, subject to Board approval, may also choose to reopen the Fund to new investments at any time, and may subsequently close the Fund again should concerns regarding the Funds size recur. If the Fund closes to new investments, the Fund may be offered only to certain existing shareholders of the Fund and certain other persons who may be subject to cumulative, maximum purchase amounts, as follows:
a. persons who already hold shares of the Fund directly or through accounts maintained by brokers by arrangement with the Adviser,
b. employees of the Adviser and their families, and
c. directors of the Company.
Distributions to all shareholders of the Fund will continue to be reinvested unless a shareholder elects otherwise. The Adviser, subject to Board approval, reserves the right to implement specific purchase limitations at the time of closing, including limitations on current shareholders.
Purchases of the Funds shares will be made in full and fractional shares of the Fund calculated to three decimal places. Certificates for shares will not be issued except at the written request of the shareholder. Certificates for fractional shares, however, will not be issued.
Shares may be purchased and subsequent investments may be made by principals and employees of the Adviser and their family members, either directly or through their IRAs and by any pension and profit-sharing plan of the Adviser, without being subject to the minimum investment limitation.
The Companys officers are authorized to waive the minimum initial and subsequent investment requirements.
Good Order. You must include complete and accurate required information on your purchase request. Please see Purchase of Fund Shares for instructions. Purchase requests not in good order may be rejected.
Customer Identification Program. Federal law requires the Company to obtain, verify and record identifying information, which may include the name, residential or business street address, date of birth (for an individual), social security or taxpayer identification number or other identifying information for each investor who opens or reopens an account with the Company. Applications without the required information, or without any indication that a social security or taxpayer identification number has been applied for, may not be accepted. After acceptance, to the extent permitted by applicable law or its customer identification program, the Company reserves the right (a) to place limits on transactions in any account until the identity of the investor is verified; or (b) to refuse an investment in a Company portfolio or to involuntarily redeem an investors shares and close an account in the event that an investors identity is not verified. The Company and its agents will not be responsible for any loss in an investors account resulting from the investors delay in providing all required identifying information or from closing an account and redeeming an investors shares when an investors identity cannot be verified.
Redemption of Fund Shares
You may redeem Class A shares of the Fund at the next NAV calculated after a redemption request is received by the Transfer Agent in good order. The Funds NAV is calculated once daily at the close of regular trading hours on the NYSE (generally 4:00 p.m. Eastern time) on each day the NYSE is open. You can only redeem shares of the Fund on days the NYSE is open and through the means described below.
You may redeem shares of the Fund by mail, or, if you are authorized, by telephone. The value of shares redeemed may be more or less than the purchase price, depending on the market value of the investment securities held by the Fund.
Redemption By Mail. Your redemption requests should be addressed to Summit Global Investments U.S. Low Volatility Equity Fund, c/o BNY Mellon Investment Servicing (US) Inc., P.O. Box [ ], Providence, RI 02940, or for overnight delivery to Summit Global Investments U.S. Low Volatility Equity Fund, c/o BNY Mellon Investment Servicing (US) Inc., 4400 Computer Drive, Westborough, MA 01581 and must include:
· a letter of instruction, if required, or a stock assignment specifying the number of shares or dollar amount to be redeemed, signed by all registered owners of the shares in the exact names in which they are registered;
· any required Medallion signature guarantees, which are required when (i) the redemption proceeds are to be sent to someone other than the registered shareholder(s), (ii) the redemption request is for $10,000 or more, or (iii) a share transfer request is made. A Medallion signature guarantee is a special signature guarantee that may be obtained from a domestic bank or trust company, broker, dealer, clearing agency or savings association which is a participant in a Medallion signature guarantee program recognized by the Securities Transfer Association. A Medallion imprint or Medallion stamp indicates that the financial institution is a member of a Medallion signature guarantee program and is an acceptable signature guarantor. The three recognized Medallion signature guarantee programs are Securities Transfer Agent Medallion Program (STAMP), Stock Exchanges Medallion Program (SEMP) and New York Stock Exchange, Inc. Medallion Program (MSP). Signature guarantees which are not a part of these programs will not be accepted. Please note that a notary public stamp or seal is not acceptable; and
· other supporting legal documents, if required, in the case of estates, trusts, guardianships, custodianships, corporations, pension and profit sharing plans and other organizations.
Redemption By Telephone. In order to utilize the telephone redemption option, you must indicate that option on your Account Application. Please note that the telephone redemption option is not available for retirement accounts. You may then initiate a redemption of shares by calling the Transfer Agent at [ ] and requesting that the redemption proceeds be mailed to the primary registration address or wired per the authorized instructions. A wire charge of $7.50 is assessed and charged to the shareholder. If the telephone redemption option is authorized, the Transfer Agent may act on telephone instructions from any person representing himself or herself to be a shareholder and believed by the Transfer Agent to be genuine. The Transfer Agents records of such instructions are binding and shareholders, not the Fund or its Transfer Agent, bear the risk of loss in the event of unauthorized instructions reasonably believed by the Fund or its Transfer Agent to be genuine. The Fund and the Transfer Agent will employ reasonable procedures to confirm that instructions communicated are genuine and, if it does not, it may be liable for any losses due to unauthorized or fraudulent instructions. The procedures employed by the Fund and the Transfer Agent in connection with transactions initiated by telephone include tape recording of telephone instructions and requiring some form of personal identification prior to acting upon instructions received by telephone.
Transaction Fee on Certain Redemptions. The Fund requires the payment of a transaction fee on redemptions of shares held for less than 60 days equal to 1.50% of the NAV of such shares redeemed at the time of redemption. This additional transaction fee is paid to the Fund, not to the Adviser, distributor or Transfer Agent. It is not a sales charge or a contingent deferred sales charge. The fee does not apply to redeemed shares that were purchased through reinvested dividends or capital gains distributions. The purpose of the additional transaction fee is to indirectly allocate transaction costs associated with redemptions to those investors making redemptions after holding their shares for a short period, thus protecting existing shareholders. These costs include: (1) brokerage costs; (2) market impact costs i.e., the decrease in market prices which may result when the Fund sells certain securities in order to raise cash to meet the redemption request; (3) the realization of capital gains by the other shareholders in the Fund; and (4) the effect of the bid-ask spread in the over-the-counter market. The 1.50% amount represents the Funds estimate of the brokerage and other transaction costs which may be incurred by the Fund in disposing of stocks in which the Fund may invest. Without the additional transaction fee, the Fund would generally be selling its shares at a price less than the cost to the Fund of acquiring the portfolio securities necessary to maintain its investment characteristics, resulting in reduced investment performance for all shareholders in the Fund. With the additional transaction fee, the transaction costs of selling additional stocks are not borne by all existing shareholders, but the source of funds for these costs is the transaction fee paid by those investors making redemptions. For purposes of this redemption feature, shares purchased first will be considered to be shares first redeemed.
Other Redemption Information. Redemption proceeds for shares of the Fund recently purchased by check may not be distributed until payment for the purchase has been collected, which may take up to fifteen days from the purchase date. Shareholders can avoid this delay by utilizing the wire purchase option. Redemption proceeds will ordinarily be paid within seven business days after a redemption request is received by the Transfer Agent in good order. The Fund may suspend the right of redemption or postpone the date at times when the NYSE or the bond market is closed or under any emergency circumstances as determined by the SEC.
If the Companys Board of Directors determines that it would be detrimental to the best interests of the remaining shareholders of the Fund to make payment wholly or partly in cash, redemption proceeds may be paid in whole or in part by an in-kind distribution of readily marketable securities held by the Fund instead of cash in conformity with applicable rules of the SEC. Investors generally will incur brokerage charges on the sale of portfolio securities so received in the payment of redemptions. If a shareholder receives redemption proceeds in-kind, the shareholder will bear the market risk of the securities received in the redemption until their disposition and should expect to incur transaction costs upon the disposition of the securities. The Company has elected, however, to be governed by Rule 18f-1 under the 1940 Act, so that the Fund is obligated to redeem its shares solely in cash up to the lesser of $250,000 or 1% of its NAV during any 90-day period for any one shareholder of the Fund.
Good Order. You must include complete and accurate required information on your redemption request. Please see Redemption of Fund Shares for instructions. Redemption requests not in good order may be delayed.
Involuntary Redemption. The Fund reserves the right to redeem your account at any time the value of the account falls below $500 as the result of a redemption or an exchange request.
You will be notified in writing that the value of your account is less than $500 and will be allowed 30 days to make additional investments before the redemption is processed.
The Fund may assert the right to redeem your shares at current NAV at any time and without prior notice if, and to the extent that, such redemption is necessary to reimburse the Fund for any loss sustained by reason of your failure to make full payment for shares of the Fund you previously purchased or subscribed for.
Dividends and Distributions
The Fund will distribute substantially all of the net investment income and net realized capital gains, if any, of the Fund to the Funds shareholders. All distributions are reinvested in the form of additional full and fractional shares unless you elect otherwise.
The Fund will declare and pay dividends from net investment income quarterly. Net realized capital gains (including net short-term capital gains), if any, will be distributed at least annually.
The ex-dividend, record and payable dates of any annual distribution will be available by calling [ ].
Taxes
The following is a summary of certain United States tax considerations relevant under current law, which may be subject to change in the future. Except where otherwise indicated, the discussion relates to investors who are individual United States citizens or residents. You should consult your tax adviser for further information regarding federal, state, local and/or foreign tax consequences relevant to your specific situation.
Federal Taxes of Distributions. The Fund contemplates distributing as dividends each year all or substantially all of its taxable income, including its net capital gain (the excess of net long-term capital gain over net short-term capital loss). Except as otherwise discussed below, you will be subject to federal income tax on Fund distributions regardless of whether they are paid in cash or reinvested in additional shares. Fund distributions attributable to short-term capital gains and net investment income will generally be taxable to you as ordinary income, except as discussed below.
Distributions attributable to the net capital gain of the Fund will be taxable to you as long-term capital gain, no matter how long you have owned your Fund shares. The maximum long-term capital gain rate applicable to individuals, estates, and trusts is currently 15%. You will be notified annually of the tax status of distributions to you.
Distributions of qualifying dividends will also generally be taxable to you at long-term capital gain rates, as long as certain requirements are met. In general, if 95% or more of the gross income of the Fund (other than net capital gain) consists of dividends received from domestic corporations or qualified foreign corporations (qualifying dividends), then all distributions paid by the Fund to individual shareholders will be taxed at long-term capital gains rates. But if less than 95% of the gross income of the Fund (other than net capital gain) consists of qualifying dividends, then distributions paid by the Fund to individual shareholders will be qualifying dividends only to the extent they are derived from qualifying dividends earned by the Fund. For the lower rates to apply, you must have owned your Fund shares for at least 61 days during the 121-day period beginning on the date that is 60 days before the Funds ex-dividend date (and the Fund will need to have met a similar holding period requirement with respect to the shares of the corporation paying the qualifying dividend). The amount of the Funds distributions that qualify for this favorable treatment may be reduced as a result of
the Funds securities lending activities (if any), a high portfolio turnover rate or investments in debt securities or non-qualified foreign corporations.
Distributions from the Fund will generally be taxable to you in the taxable year in which they are paid, with one exception. Distributions declared by the Fund in October, November or December and paid in January of the following year are taxed as though they were paid on December 31.
A portion of distributions paid by the Fund to shareholders that are corporations may also qualify for the dividends-received deduction for corporations, subject to certain holding period requirements and debt financing limitations.
If you purchase shares just before a distribution, the purchase price will reflect the amount of the upcoming distribution, but you will be taxed on the entire amount of the distribution received, even though, as an economic matter, the distribution simply constitutes a return of capital. This is known as buying into a dividend.
Sales and Exchanges. You will generally recognize taxable gain or loss for federal income tax purposes on a sale, exchange or redemption of your shares based on the difference between your tax basis in the shares and the amount you receive for them. Generally, you will recognize long-term capital gain or loss if you have held your Fund shares for over twelve months at the time you dispose of them. (To aid in computing your tax basis, you should retain your account statements for the periods during which you held shares.)
Any loss realized on shares held for six months or less will be treated as a long-term capital loss to the extent of any capital gain dividends that were received on the shares. Additionally, any loss realized on a disposition of shares of the Fund may be disallowed under wash sale rules to the extent the shares disposed of are replaced with other shares of the Fund within a period of 61 days beginning 30 days before and ending 30 days after the shares are disposed of, such as pursuant to a dividend reinvestment in shares of the Fund. If disallowed, the loss will be reflected in an upward adjustment to the basis of the shares acquired.
IRAs and Other Tax-Qualified Plans. The one major exception to the preceding tax principles is that distributions on, and sales, exchanges and redemptions of, shares held in an IRA (or other tax-qualified plan) will not be currently taxable.
Backup Withholding. The Fund may be required in certain cases to withhold and remit to the U.S. Treasury a percentage of taxable dividends or gross proceeds realized upon sale payable to shareholders who have failed to provide a correct tax identification number in the manner required, or who are subject to withholding by the Internal Revenue Service for failure to properly include on their return payments of taxable interest or dividends, or who have failed to certify to the Fund that they are not subject to backup withholding when required to do so or that they are exempt recipients. The current withholding rate is 28%.
U.S. Tax Treatment of Foreign Shareholders. For nonresident aliens, foreign corporations and other foreign investors, Fund distributions attributable to net long-term capital gains of the Fund will generally be exempt from U.S. tax, but all other Fund distributions will generally be subject to a 30% withholding tax. The withholding tax may, however, be reduced (and, in some cases, eliminated) under an applicable tax treaty between the United States and a shareholders country of residence or incorporation, provided that the shareholder furnishes the Fund with a properly completed Form W-8BEN to establish entitlement for these treaty benefits.
Foreign shareholders will generally not be subject to U.S. tax on gains realized on sale, exchange or redemption of shares in the Fund.
Different U.S. tax rules may apply to a foreign shareholder, however, if the investment in the Fund is connected to a trade or business of the shareholder in the United States or the investor is present in the United States for 183 days or more in a year.
All foreign investors should consult their own tax advisors regarding the tax consequences in their country of residence of an investment in the Fund.
State and Local Taxes. You may also be subject to state and local taxes on income and gain from Fund shares. State income taxes may not apply, however, to the portions of the Funds distributions, if any, that are attributable to interest on U.S. government securities. You should consult your tax adviser regarding the tax status of distributions in your state and locality.
Future Tax Treatment . Some of the tax provisions described above are subject to sunset provisions. Specifically, a sunset provision provides that the 15% long-term capital gain rate and the taxation of dividends at the long-term capital gain rate will change after 2012.
More information about taxes is contained in the Funds SAI.
Multi-Class Structure
The Fund also offers Class I shares and Retail shares through separate prospectuses. Class I shares are offered directly to institutional investors without distribution fees or sales charges. Retail shares are offered directly to individual investors without the imposition of any sales charges but are subject to distribution fees. Shares of each class of the Fund represent equal pro rata interests in the Fund and accrue dividends and calculate NAV and performance quotations in the same manner. The performance of each class is quoted separately due to different actual expenses. The total return on Class A shares of the Fund can be expected to differ from the total return on Class I shares or Retail shares of the Fund. Information concerning other classes of the Fund can be requested by calling the Fund at [ ].
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS OR IN THE FUNDS SAI 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 THE COMPANY OR ITS DISTRIBUTOR. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING BY THE COMPANY OR BY THE DISTRIBUTOR IN ANY JURISDICTION IN WHICH SUCH OFFERING MAY NOT LAWFULLY BE MADE.
Appendix A
Prior Performance of Similarly Advised Accounts
The Adviser has experience in managing other accounts with substantially similar investment objectives, policies and strategies as the Fund. The table below is provided to illustrate the past performance of the Adviser in managing all its other similarly advised accounts and does not represent the performance of the Fund. Investors should not consider this performance information as a substitute for the performance of the Fund, nor should investors consider this information as an indication of the future performance of the Fund or of the Adviser. This performance history is net of all fees (including any applicable sales loads) charged to investors in the other accounts. The net returns are derived using the investment advisory fixed rate fee of 1.00% on total assets applicable for each other account and calculated on a monthly basis. The composite includes other accounts that pay lower expenses than those paid by shareholders of the Fund. Higher expenses reduce returns to investors. The use of the Funds expense structure would have lowered the performance results. The Funds results in the future also may be different because the other accounts are not subject to certain investment limitations, diversification requirements and other restrictions imposed on mutual funds under applicable U.S. securities and tax laws that, if applicable, could have adversely affected the performance of the other accounts. In addition, the securities held by the Fund will not be identical to the securities held by the other accounts.
The performance of the other accounts is also compared to the performance of an appropriate broad-based securities benchmark index. This index is unmanaged and is not subject to fees and expenses typically associated with managed funds, including the Fund. Investors cannot invest directly in the Index. The performance information is accompanied by additional disclosures, which are an integral part of the information.
COMPOSITE MONTHLY PERFORMANCE TABLE NET OF FEES
(SINCE INCEPTION JANUARY 14, 2011)(1),(2),(3)
|
|
Jan |
|
Feb |
|
Mar |
|
Apr |
|
May |
|
Jun |
|
Jul |
|
Aug |
|
Sep |
|
Oct |
|
Nov |
|
Dec |
|
US Equity Low Volatility Composite |
|
-1.72 |
% |
1.92 |
% |
1.97 |
% |
4.13 |
% |
0.71 |
% |
0.11 |
% |
-2.82 |
% |
-1.63 |
% |
-2.17 |
% |
4.80 |
% |
0.41 |
% |
|
|
S&P 500 ® Index |
|
-0.55 |
% |
3.20 |
% |
-0.10 |
% |
2.85 |
% |
-1.35 |
% |
-1.83 |
% |
-2.15 |
% |
-5.68 |
% |
-7.18 |
% |
10.77 |
% |
-0.51 |
% |
|
|
(1) Performance was calculated using Global Investment Performance Standards (GIPS). This method of calculating performance differs from the SECs standardized methodology, which may produce different results.
(2) Performance shown is composite performance of all similarly advised accounts. The first similarly advised account commenced operations on January 14, 2011, but other accounts commenced operations subsequent to January 14, 2011.
(3) The S&P 500 ® Index is an unmanaged index composed of 500 common stocks, classified in eleven industry sectors, which represents approximately 75% of the U.S. equities market. The S&P 500 ® Index assigns relative values to the stocks included in the index, weighted according to each stocks total market value relative to the total market value of the other stocks included in the index.
THE SUMMIT GLOBAL INVESTMENTS U.S. LOW VOLATILITY EQUITY FUND
FOR MORE INFORMATION:
This prospectus contains important information you should know before you invest. Read it carefully and keep it for future reference. More information about the Fund is available free of charge, upon request, including:
Annual/Semi-Annual Reports
These reports contain additional information about the Funds investments, describe the Funds performance, list portfolio holdings, and discuss recent market conditions and economic trends. The annual report includes Fund strategies and market conditions that significantly affected the Funds performance during its last fiscal year.
Statement of Additional Information
An SAI, dated [March 1, 2012], has been filed with the SEC. The SAI, which includes additional information about the Fund, along with the Funds annual and semi-annual reports, when available, are available on [the Advisers website at www.summitglobalinvestments.com or may be obtained free of charge by calling [ ]. The SAI, as supplemented from time to time, is incorporated by reference into this prospectus and is legally considered a part of this prospectus.
Shareholder Account Service Representatives
Representatives are available to discuss account balance information, mutual fund prospectuses, literature, programs and services available. Hours: 8 a.m. to 6 p.m. (Eastern time) Monday-Friday. Call: [ ].
Purchases and Redemptions
Call your registered representative or [ ].
Written Correspondence
Post Office Address: |
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Summit Global Investments U.S. Low Volatility Equity Fund c/o BNY Mellon Investment Servicing (US) Inc. PO Box [ ] Providence, RI 02940 |
Street Address: |
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Summit Global Investments U.S. Low Volatility Equity Fund c/o BNY Mellon Investment Servicing (US) Inc. 4400 Computer Drive Westborough, MA 01581 |
Securities and Exchange Commission
You may view and copy information about the Company and the Fund, including the SAI, by visiting the SECs Public Reference Room in Washington, D.C. or the EDGAR Database on the SECs Internet site at www.sec.gov. You may also obtain copies of Fund documents by paying a duplicating fee and sending an electronic request to the following e-mail address: publicinfo@sec.gov, or by sending your written request and a duplicating fee to the SECs Public Reference Section, Washington, D.C. 20549-1520. You may obtain information on the operation of the public reference room by calling the SEC at (202) 551-8090.
INVESTMENT COMPANY ACT FILE NO. 811-05518
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS
SUMMIT GLOBAL INVESTMENTS
U.S. LOW VOLATILITY EQUITY FUND
Retail Shares
TICKER: [ ]
of The RBB Fund, Inc.
This prospectus gives vital information about the Summit Global Investments U.S. Low Volatility Equity Fund (the Fund), an investment portfolio of The RBB Fund, Inc. (the Company), including information on investment policies, risks and fees. For your own benefit and protection, please read it before you invest and keep it on hand for future reference.
PROSPECTUS
[March 1, 2012]
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
THE SECURITIES DESCRIBED IN THIS PROSPECTUS HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION (SEC). THE SEC, HOWEVER, HAS NOT JUDGED THESE SECURITIES FOR THEIR INVESTMENT MERIT AND HAS NOT DETERMINED THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANYONE WHO TELLS YOU OTHERWISE IS COMMITTING A CRIMINAL OFFENSE.
TABLE OF CONTENTS
A look at the goals, strategies, risks and financial history of the Fund. |
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SUMMARY SECTION |
1 |
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Investment Objective |
1 |
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Expenses and Fees |
1 |
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Risk/Return Information |
2 |
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|
Management of the Fund |
2 |
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|
Purchase and Sale of Fund Shares |
2 |
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Tax Information |
3 |
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|
Payments to Broker-Dealers and Other Financial Intermediaries |
3 |
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|
ADDTIONAL INFORMATION ON THE FUNDS INVESTMENT OBJECTIVE AND PRINCIPAL STRATEGIES |
4 |
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ADDITIONAL INFORMATION ON RISKS OF INVESTING IN THE FUND |
4 |
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Details about the Funds service providers. |
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MANAGEMENT OF THE FUND |
6 |
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Investment Adviser |
6 |
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Portfolio Manager |
6 |
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Other Service Providers |
7 |
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Policies and instructions for opening, maintaining and closing an account in the Fund. |
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SHAREHOLDER INFORMATION |
8 |
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Pricing of Fund Shares |
8 |
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Market Timing |
8 |
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Purchase of Fund Shares |
9 |
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|
Redemption of Fund Shares |
11 |
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Dividends and Distributions |
12 |
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Taxes |
13 |
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Appendix A Prior Performance of Similarly Advised Accounts |
15 |
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FOR MORE INFORMATION |
Back Cover |
SUMMARY SECTION
Investment Objective
The Summit Global Investments U.S. Low Volatility Equity Fund (the Fund) seeks to outperform the S&P 500 ® Index over a market cycle while significantly reducing the overall volatility of its portfolio through quantitative and fundamental stock selection. There can be no guarantee that the Fund will achieve its investment objective.
Expenses and Fees
This table describes the fees and expenses that you may pay if you buy and hold Retail shares of the Fund.
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Retail Class |
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|
|
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Shareholder Fees (fees paid directly from your investment) |
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|
|
|
|
|
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Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) |
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None |
|
Maximum Deferred Sales Charge (Load) |
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None |
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Maximum Sales Charge (Load) Imposed on Reinvested Dividends |
|
None |
|
Redemption Fee (as a percentage of amount redeemed on shares held for less than 60 days, if applicable) |
|
1.50 |
% |
Exchange Fee (as a percentage of amount redeemed on shares held for less than 60 days, if applicable) |
|
1.50 |
% |
|
|
|
|
Annual Fund Operating Expenses (expenses that that you pay each year as a percentage of the value of your investment) |
|
|
|
|
|
|
|
Management Fees |
|
0.70 |
% |
Distribution (12b-1) Fees |
|
0.25 |
% |
Other Expenses (1) |
|
0.98 |
% |
|
|
|
|
Total Annual Fund Operating Expenses |
|
1.93 |
% |
|
|
|
|
Fee Waivers and Expense Reimbursements (2) |
|
0.70 |
% |
|
|
|
|
Net Expenses |
|
1.23 |
% |
(1) Other expenses are based on estimated amounts for the current fiscal year.
(2) The Funds investment adviser has contractually agreed to waive management fees and reimburse expenses through [March 1, 2013], to the extent that Total Annual Fund Operating Expenses (excluding acquired fund fees and expenses, brokerage commissions, extraordinary items, interest and taxes) exceed 1.23%.
Example:
This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Funds operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
1 Year |
|
3 Years |
|
||
$ |
125 |
|
$ |
538 |
|
Portfolio Turnover
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover rate may indicate higher transactions costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the example, affect the Funds performance.
Principal Investment Strategies
Under normal circumstances, the Fund will invest at least 80% of its net assets (including borrowings for investment purposes) in equity securities, primarily common stocks, of U.S. companies. The Funds investment adviser attempts to lower the Funds market risk by investing in U.S. equity securities that lower the overall volatility of the Funds portfolio as compared to the S&P 500 ® Index. The Fund invests in stocks that exhibit less
volatile stock price patterns, strengthening business metrics and quantitative factors that the Funds investment adviser anticipates will produce less volatility with more capital protection and more consistent returns.
Principal Risks
· Common Stock Risk. Investments in common stocks are subject to market, economic and business risks that will cause their price to fluctuate over time. Therefore, an investment in the Fund may be more suitable for long-term investors who can bear the risk of these fluctuations.
· Management Risk. The Fund is subject to the risk of poor management stock selection. In other words, the individual stocks in the Fund may not perform as well as expected, and/or the Funds portfolio management practices do not work to achieve their desired result.
· Market Risk. The net asset value (NAV) of the Fund will change with changes in the market value of its portfolio positions. Investors may lose money. Although the Fund will invest in stocks the Funds investment adviser believes will produce less volatility, there is no guarantee that the stocks will perform as expected.
· Opportunity Risk. As with all mutual funds, the Fund is subject to the risk of missing out on an opportunity because the assets necessary to take advantage of it are tied up in less advantageous investments.
Performance Information
No performance information is available for the Fund because it had not commenced operations as of the date of this Prospectus. The Fund intends to evaluate its performance as compared to that of the S&P 500 ® Index.
Management of the Fund
Investment Adviser
Summit Global Investments, LLC
Portfolio Manager
David Harden
President of the Investment Adviser
Portfolio Manager of the Fund since inception
Purchase and Sale of Fund Shares
Minimum Initial Investment
$2,500
Shares of the Fund may be available through certain brokerage firms, financial institutions and other industry professionals (collectively, Service Organizations). Certain features, such as the initial and subsequent investment minimums and certain trading restrictions, may be modified or waived by Service Organizations. Service Organizations may impose transaction or administrative charges or other direct fees, which charges and fees would not be imposed if shares are purchased directly from The RBB Fund, Inc. The Fund may accept initial investments of smaller amounts in its sole discretion.
You can only purchase and redeem shares of the Fund on days the New York Stock Exchange (NYSE) is open and through the means described below.
Purchase and Redemption By Mail:
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
P.O. Box [ ]
Providence, RI 02940-8042
Overnight Mail:
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
4400 Computer Drive
Westborough, MA 01581
Purchase and Redemption By Wire:
[ ]
ABA# [ ]
Account # [ ]
F/B/O Summit Global Investments U.S. Low Volatility Equity Fund
Ref. (Shareholder Name; Account Number)
Redemption By Telephone: If you select the option on your account application, you may call the Funds transfer agent at [ ].
Tax Information
The Fund intends to make distributions that may be taxed as ordinary income or capital gains. The Fund contemplates declaring as dividends each year all or substantially all of its taxable income.
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediarys website for more information.
ADDITIONAL INFORMATION ABOUT THE FUNDS INVESTMENTS AND RISKS
This section provides some additional information about the Funds investments and certain portfolio management techniques that the Fund may use. More information about the Funds investments and portfolio management techniques, some of which entail risks, is included in the Statement of Additional Information (SAI).
Investment Objective
The Funds investment objective may be changed by the Board of Directors of The RBB Fund, Inc. (the Company) without shareholder approval. Shareholders will, however, receive 60 days prior notice of any changes. Any such changes may result in the Fund having an investment objective different from the objective that the shareholder considered appropriate at the time of investment in the Fund.
Additional Information About the Funds Investment Strategies
Other Investment Companies. The Fund may invest up to 10% of its total assets in the securities of other investment companies not affiliated with the Adviser, but may not invest more than 5% of its total assets in the securities of any one investment company or acquire more than 3% of the voting securities of any other investment company. Among other things, the Fund may invest in money market mutual funds for cash management purposes by sweeping excess cash balances into such funds until the cash is invested or otherwise utilized. Rule 12d1-1 under the Investment Company Act of 1940, as amended, permits the Fund to invest an unlimited amount of its uninvested cash in a money market fund so long as, among other things, said investment is consistent with the Funds investment objectives and policies. The Fund will indirectly bear its proportionate share of any management fees and other expenses paid by investment companies in which it invests in addition to the advisory and administration fees paid by the Fund.
Securities Lending. The Fund may seek to increase its income by lending portfolio securities to institutions, such as certain broker-dealers. Portfolio securities loans are secured continuously by collateral maintained on a current basis at an amount at least equal to the market value of the securities loaned. The value of the securities loaned by the Fund will not exceed 331/3% of the value of the Funds total assets. The Fund may experience a loss or delay in the recovery of its securities if the borrowing institution breaches its agreement with the Fund. Lending the Funds portfolio securities involves the risk of delay in receiving additional collateral if the value of the securities goes up while they are on loan.
Borrowing. The Fund may borrow money for temporary or emergency (not leveraging) purposes. The Fund will not make any additional investments while borrowings exceed 5% of its total assets.
Temporary Investments. The Fund may depart from its principal investment strategy in response to adverse market, economic, political or other conditions by taking a temporary defensive position (up to 100% of its assets) in all types of money market and short-term debt securities. If the Fund were to take a temporary defensive position, it may be unable for a time to achieve its investment objective.
Additional Information About the Funds Risks
The following provides additional information about the risks of investing in the Fund:
· At least 80% of the Funds net assets will be invested under normal circumstances in equity securities, and the net asset value of the Fund will vary with changes in the market value of the portfolio positions. The Fund will provide shareholders with at least 60 days prior written notice of any change in this 80% policy.
· The market value of a portfolio holding may fluctuate, sometimes rapidly and unpredictably. The prices of equity securities change in response to many factors including the historical and prospective earnings of the issuer, the value of its assets, general economic conditions, interest rates, investor perceptions and market liquidity. Decreases in market value of the Funds portfolio securities could adversely affect the Funds net asset value.
· The Fund may, for temporary defensive purposes, invest a percentage of its total assets, without limitation, in cash or various money market instruments. The value of money market instruments tends to fall when current interest rates rise. Money market instruments are generally less sensitive to interest rate changes than longer-term securities. When the Funds assets are invested in cash or money market instruments, the Fund may not achieve its investment goal.
Disclosure of Portfolio Holdings
A description of the Companys policies and procedures with respect to the disclosure of the Funds portfolio securities is available in the Funds SAI.
MANAGEMENT OF THE FUND
Investment Adviser
Summit Global Investments, LLC (the Adviser) serves as the Funds investment adviser. The Advisers principal address is 189 North, Hwy 89, Suite 144, North Salt Lake, Utah 84054. The Adviser provides investment management and investment advisory services to investment companies and other institutional accounts.. The Adviser is 100% employee-owned, and was founded in 2010.
Pursuant to an investment advisory agreement with the Company, the Adviser is entitled to an advisory fee computed daily and payable monthly at the annual rate of 0.70% of the Funds average daily net assets. The Adviser has contractually agreed to waive its management fees and reimburse expenses through [March 1, 2013], to the extent that the Funds total annual operating expenses (excluding acquired fund fees and expenses, brokerage commissions, extraordinary items, interest and taxes) exceed 1.23%.
A discussion regarding the basis for the Companys Board of Directors approving the Funds investment advisory agreement with the Adviser will be available in the Funds first report to shareholders.
Portfolio Manager
The President of the Adviser, David Harden, is primarily responsible for the day-to-day management of the Funds investment portfolio. Mr. Harden founded the Adviser in 2010 , and has managed the Fund since its inception. He started his career in 1993 and has worked for such firms as Fidelity Investments, Wellington Management and Evergreen Investments. From 2006 to 2011, Mr. Harden has worked with Ensign Peak Advisors, Inc., most recently as Vice President and Senior Portfolio Manager, where he managed and oversaw day-to-day research, portfolio management and trading for all index, quantitative and low volatility strategies.
The SAI provides additional information about the portfolio managers compensation, other accounts managed by the portfolio manager and the portfolio managers ownership of securities in the Fund.
Other Service Providers
The following chart shows the Funds service providers and includes their addresses and principal activities.
SHAREHOLDER INFORMATION
Pricing of Fund Shares
Retail Shares of the Fund are sold at their net asset value (NAV). The NAV of Retail Shares of the Fund is calculated as follows:
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|
Value of Assets Attributable to Retail Shares of the Fund |
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|
|
|
|
NAV = |
Value of Liabilities Attributable Retail Shares of the Fund |
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|
|
Number of Outstanding Retail Shares of the Fund |
|
The Funds NAV is calculated once daily at the close of regular trading hours on the New York Stock Exchange (NYSE) (generally 4:00 p.m. Eastern time) on each day the NYSE is open. The NYSE is generally open Monday through Friday, except national holidays. The Fund will effect purchases and redemptions of Fund shares at the NAV next calculated after receipt of your order or request in good order.
The Funds equity securities listed on any national or foreign exchange market system will be valued at the last sale price, except for the National Association of Securities Dealers Automatic Quotation System (NASDAQ). Equity securities listed on NASDAQ will be valued at the official closing price. Equity securities traded in the over-the-counter market are valued at their closing prices. If there were no transactions on that day, securities traded principally on an exchange or on NASDAQ will be valued at the mean of the last bid and ask prices prior to the market close. Fixed income securities having a remaining maturity of 60 days or less are valued at amortized cost, which approximates market value. Fixed income securities having a remaining maturity of greater than 60 days are valued using an independent pricing service. When prices are not available from such services or are deemed to be unreliable, securities may be valued by dealers who make markets in such securities.
If market quotations are unavailable or deemed unreliable by the Funds administrator, in consultation with the Adviser, securities will be valued in accordance with procedures adopted by the Companys Board of Directors and under the Board of Directors ultimate supervision. Relying on prices supplied by pricing services or dealers or using fair valuation involves the risk that the values used by a Fund to price its investments may be higher or lower than the values used by other investment companies and investors to price the same investments.
Investments in other open-end investment companies are valued based on the NAV of those investment companies (which may use fair value pricing as discussed in their prospectuses).
Market Timing
In accordance with the policy adopted by the Companys Board of Directors, the Company discourages and does not accommodate market timing and other excessive trading practices. Purchases should be made with a view to longer-term investment only. Excessive short-term (market timing) trading practices may disrupt portfolio management strategies, increase brokerage and administrative costs, harm Fund performance and result in dilution in the value of Fund shares held by long-term shareholders. The Company and the Adviser reserve the right to (i) reject a purchase or exchange order, (ii) delay payment of immediate cash redemption proceeds for up to seven calendar days, (iii) revoke a shareholders privilege to purchase Fund shares (including exchanges), or (iv) limit the amount of any exchange. An investor may receive notice that their purchase order or exchange has been rejected after the day the order is placed or after acceptance by a financial intermediary. . The Company and the Adviser will not be liable for any loss resulting from rejected purchase orders. To minimize harm to the Company and its shareholders (or the Adviser), the Company (or the Adviser) will exercise their right if, in the Companys (or the Advisers) judgment, an investor has a history of excessive trading or if an investors trading, in the judgment of the Company or the Adviser, has been or may be disruptive to the Fund. No waivers of the provisions of the policy established to detect and deter market timing and other excessive trading activity are permitted that would harm the Fund and its shareholders or would subordinate the interests of the Fund and its shareholders to those of the Adviser or any affiliated person or associated person of the Adviser.
To deter excessive shareholder trading, the Fund charges a redemption fee of 1.50% on shares redeemed within 60 days of purchase. For further information on redemptions, please see the section entitled Shareholder Information Redemptions of Fund Shares.
There is no assurance that the Adviser will be able to identify market timers, particularly if they are investing through intermediaries.
If necessary, the Company may prohibit additional purchases of Fund shares by a financial intermediary or by certain customers of the financial intermediary. Financial intermediaries may also monitor their customers trading activities in the Fund. The criteria used by intermediaries to monitor for excessive trading may differ from the criteria used by the Company. If a financial intermediary fails to enforce the Companys excessive trading policies, the Company may take certain actions, including terminating the relationship.
Purchase of Fund Shares
Shares representing interests in the Fund are offered continuously for sale by BNY Mellon Distributors Inc. (the Distributor). The Board of Directors has approved a Distribution Agreement and adopted a Plan of Distribution for Retail shares (the Plan) pursuant to Rule 12b-1 under the 1940 Act. Under the Plan, the Distributor is entitled to receive from the Fund a distribution fee with respect to Retail shares of the Fund, which is accrued daily and paid monthly, of up to 0.25% on an annualized basis of the average daily net assets of the Retail shares. The actual amount of such compensation under the Plan is agreed upon by the Companys Board of Directors and by the Distributor. Because these fees are paid out of the Funds assets on an ongoing basis, over time these fees will increase the cost of your investment and may cost you more than paying other types of sales charges.
Amounts paid to the Distributor under the Plan may be used by the Distributor to cover expenses that are related to (i) the sale of Retail shares, (ii) ongoing servicing and/or maintenance of the accounts of Retail class shareholders, and (iii) sub-transfer agency services, subaccounting services or administrative services related to the sale of Retail shares, all as set forth in the Plan. Ongoing servicing and/or maintenance of the accounts of Retail class shareholders may include updating and mailing prospectuses and shareholder reports, responding to inquiries regarding shareholder accounts and acting as agent or intermediary between shareholders and the Fund or its service providers. The Distributor may delegate some or all of these functions to Service Organizations. See Purchases Through Intermediaries below.
The Plan obligates the Fund, during the period it is in effect, to accrue and pay to the Distributor on behalf of the Retail shares the fee agreed to under the Distribution Agreement. Payments under the Plan are not tied exclusively to expenses actually incurred by the Distributor, and the payments may exceed distribution expenses actually incurred.
Purchases Through Intermediaries. Retail shares of the Fund may also be available through Service Organizations. Certain features of the shares, such as the initial and subsequent investment minimums and certain trading restrictions, may be modified or waived by Service Organizations. Service Organizations may impose transaction or administrative charges or other direct fees, which charges and fees would not be imposed if shares are purchased directly from the Company. Therefore, you should contact the Service Organization acting on your behalf concerning the fees (if any) charged in connection with a purchase or redemption of shares and should read this Prospectus in light of the terms governing your accounts with the Service Organization. Service Organizations will be responsible for promptly transmitting client or customer purchase and redemption orders to the Company in accordance with their agreements with the Company or its agent and with clients or customers. Service Organizations or, if applicable, their designees that have entered into agreements with the Company or its agent may enter confirmed purchase orders on behalf of clients and customers, with payment to follow no later than the Companys pricing on the following Business Day. If payment is not received by such time, the Service Organization could be held liable for resulting fees or losses. The Company will be deemed to have received a purchase or redemption order when a Service Organization, or, if applicable, its authorized designee, accepts a purchase or redemption order in good order if the order is actually received by the Company in good order not later than the next business morning. If a purchase order is not received by the Fund in good order, BNY Mellon Investment Servicing (US) Inc. (the Transfer Agent) will contact the financial intermediary to determine the status of the purchase order. Orders received by the Company in good order will be priced at the appropriate Funds NAV next computed after they are deemed to have been received by the Service Organization or its authorized designee.
The Company relies upon the integrity of Service Organizations to ensure that orders are timely and properly submitted. The Fund cannot assure you that a Service Organization properly submitted to it all purchase and redemption orders received from the Service Organizations customers before the time for determination of the Funds NAV in order to obtain that days price.
For administration, subaccounting, transfer agency and/or other services, the Adviser, the Distributor or their affiliates may pay Service Organizations and certain recordkeeping organizations a fee (the Service Fee) relating to the average annual NAV of accounts with the Company maintained by such Service Organizations or recordkeepers. The Service Fee payable to any one Service Organization is determined based upon a number of factors, including the nature and quality of services provided, the operations processing requirements of the relationship and the standardized fee schedule of the Service Organization or recordkeeper.
General. You may also purchase Retail shares of the Fund at the NAV per share next calculated after your order is received by the Transfer Agent in good order as described below. The Funds NAV is calculated once daily at the close of regular trading hours on the NYSE (generally 4:00 p.m. Eastern time) on each day the NYSE is open. After an initial purchase is made, the Transfer Agent will set up an account for you on the Companys records. The minimum initial investment in the Fund is $2,500 and there is no minimum subsequent investment amount. The minimum initial investment requirements may
be reduced or waived from time to time. For purposes of meeting the minimum initial purchase, purchases by clients which are part of endowments, foundations or other related groups may be combined. You can only purchase shares of the Fund on days the NYSE is open and through the means described below. Shares may be purchased by principals and employees of the Adviser and its subsidiaries and by their spouses and children either directly or through any trust that has the principal, employee, spouse or child as the primary beneficiaries, their individual retirement accounts, or any pension and profit-sharing plan of the Adviser and its subsidiaries without being subject to the minimum investment limitations.
Initial Investment By Mail. Subject to acceptance by the Fund, an account may be opened by completing and signing an Account Application and mailing it to the Fund at the address noted below, together with a check payable to Summit Global Investments U.S. Low Volatility Equity Fund. Third party endorsed checks or foreign checks will not be accepted.
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
P.O. Box [ ]
Providence, RI 02940
or overnight to:
Summit Global Investments U.S. Low Volatility Equity Fund
c/o BNY Mellon Investment Servicing (US) Inc.
4400 Computer Drive
Westborough, MA 01581
Subject to acceptance by the Fund, payment for the purchase of shares received by mail will be credited to a shareholders account at the NAV per share of the Fund next determined after receipt of payment in good order.
Initial Investment By Wire. Subject to acceptance by the Fund, Retail shares may be purchased by wiring federal funds to [ ] (see instructions below). A completed Account Application must be forwarded to the Transfer Agent at the address noted above under Initial Investment by Mail in advance of the wire. Notification must be given to the Transfer Agent at (888) 520-3277 prior to 4:00 p.m., Eastern time, on the wire date. (Prior notification must also be received from investors with existing accounts.) Funds should be wired to:
Federal funds wire purchases will be accepted only on days when the Fund and [ ] are open for business.
Additional Investments. Additional investments may be made at any time by purchasing shares at the NAV per share of the Fund by mailing a check to the Transfer Agent at the address noted above under Initial Investment by Mail (payable to Summit Global Investments U.S. Low Volatility Equity Fund) or by wiring monies to the custodian bank as outlined above under Initial Investment by Wire. Notification must be given to the Transfer Agent at [ ] prior to 4:00 p.m., Eastern time, on the wire date. Initial and additional purchases made by check cannot be redeemed until payment of the purchase has been collected, which may take up to fifteen calendar days from the purchase date.
Retirement Plans/IRA Accounts. A $15.00 retirement custodial maintenance fee is charged per IRA account per year. For further information as to applications and annual fees, contact the Transfer Agent at [ ]. To determine whether the benefits of an IRA are available and/or appropriate, you should consult with a tax advisor.
Other Purchase Information. The Company reserves the right, in its sole discretion, to suspend the offering of shares or to reject purchase orders when, in the judgment of management, such suspension or rejection is in the best interest of the Fund. The Adviser will monitor the Funds total assets and may, subject to Board approval, decide to close the Fund at any time to new investments or to new accounts due to concerns that a significant increase in the size of the Fund may adversely affect the implementation of the Funds strategy. The Adviser, subject to Board approval, may also choose to reopen the Fund to new investments at any time, and may subsequently close the Fund again should concerns regarding the Funds size recur. If the Fund closes to new investments, the Fund may be offered only to certain existing shareholders of the Fund and certain other persons who may be subject to cumulative, maximum purchase amounts, as follows:
a. persons who already hold shares of the Fund directly or through accounts maintained by brokers by arrangement with the Adviser,
b. employees of the Adviser and their families, and
c. directors of the Company.
Distributions to all shareholders of the Fund will continue to be reinvested unless a shareholder elects otherwise. The Adviser, subject to Board approval, reserves the right to implement specific purchase limitations at the time of closing, including limitations on current shareholders.
Purchases of the Funds shares will be made in full and fractional shares of the Fund calculated to three decimal places. Certificates for shares will not be issued except at the written request of the shareholder. Certificates for fractional shares, however, will not be issued.
Shares may be purchased and subsequent investments may be made by principals and employees of the Adviser and their family members, either directly or through their IRAs and by any pension and profit-sharing plan of the Adviser, without being subject to the minimum investment limitation.
The Companys officers are authorized to waive the minimum initial and subsequent investment requirements.
Good Order. You must include complete and accurate required information on your purchase request. Please see Purchase of Fund Shares for instructions. Purchase requests not in good order may be rejected.
Customer Identification Program. Federal law requires the Company to obtain, verify and record identifying information, which may include the name, residential or business street address, date of birth (for an individual), social security or taxpayer identification number or other identifying information for each investor who opens or reopens an account with the Company. Applications without the required information, or without any indication that a social security or taxpayer identification number has been applied for, may not be accepted. After acceptance, to the extent permitted by applicable law or its customer identification program, the Company reserves the right (a) to place limits on transactions in any account until the identity of the investor is verified; or (b) to refuse an investment in a Company portfolio or to involuntarily redeem an investors shares and close an account in the event that an investors identity is not verified. The Company and its agents will not be responsible for any loss in an investors account resulting from the investors delay in providing all required identifying information or from closing an account and redeeming an investors shares when an investors identity cannot be verified.
Redemption of Fund Shares
You may redeem Retail shares of the Fund at the next NAV calculated after a redemption request is received by the Transfer Agent in good order. The Funds NAV is calculated once daily at the close of regular trading hours on the NYSE (generally 4:00 p.m. Eastern time) on each day the NYSE is open. You can only redeem shares of the Fund on days the NYSE is open and through the means described below.
You may redeem shares of the Fund by mail, or, if you are authorized, by telephone. The value of shares redeemed may be more or less than the purchase price, depending on the market value of the investment securities held by the Fund.
Redemption By Mail. Your redemption requests should be addressed to Summit Global Investments U.S. Low Volatility Equity Fund, c/o BNY Mellon Investment Servicing (US) Inc., P.O. Box [ ], Providence, RI 02940, or for overnight delivery to Summit Global Investments U.S. Low Volatility Equity Fund, c/o BNY Mellon Investment Servicing (US) Inc., 4400 Computer Drive, Westborough, MA 01581 and must include:
· a letter of instruction, if required, or a stock assignment specifying the number of shares or dollar amount to be redeemed, signed by all registered owners of the shares in the exact names in which they are registered;
· any required Medallion signature guarantees, which are required when (i) the redemption proceeds are to be sent to someone other than the registered shareholder(s), (ii) the redemption request is for $10,000 or more, or (iii) a share transfer request is made. A Medallion signature guarantee is a special signature guarantee that may be obtained from a domestic bank or trust company, broker, dealer, clearing agency or savings association which is a participant in a Medallion signature guarantee program recognized by the Securities Transfer Association. A Medallion imprint or Medallion stamp indicates that the financial institution is a member of a Medallion signature guarantee program and is an acceptable signature guarantor. The three recognized Medallion signature guarantee programs are Securities Transfer Agent Medallion Program (STAMP), Stock Exchanges Medallion Program (SEMP) and New York Stock Exchange, Inc. Medallion Program (MSP). Signature guarantees which are not a part of these programs will not be accepted. Please note that a notary public stamp or seal is not acceptable; and
· other supporting legal documents, if required, in the case of estates, trusts, guardianships, custodianships, corporations, pension and profit sharing plans and other organizations.
Redemption By Telephone. In order to utilize the telephone redemption option, you must indicate that option on your Account Application. Please note that the telephone redemption option is not available for retirement accounts. You may then initiate a redemption of shares by calling the Transfer Agent at [ ] and requesting that the redemption proceeds be mailed to the primary registration address or wired per the authorized instructions. A wire charge of $7.50 is assessed and charged to the shareholder. If the telephone redemption option is authorized, the Transfer Agent may act on telephone instructions from any person representing himself or herself to be a shareholder and believed by the Transfer Agent to be genuine. The Transfer Agents records of such instructions are binding and shareholders, not the Fund or its Transfer Agent, bear the risk of loss in the event of unauthorized instructions reasonably believed by the Fund
or its Transfer Agent to be genuine. The Fund and the Transfer Agent will employ reasonable procedures to confirm that instructions communicated are genuine and, if it does not, it may be liable for any losses due to unauthorized or fraudulent instructions. The procedures employed by the Fund and the Transfer Agent in connection with transactions initiated by telephone include tape recording of telephone instructions and requiring some form of personal identification prior to acting upon instructions received by telephone.
Transaction Fee on Certain Redemptions. The Fund requires the payment of a transaction fee on redemptions of shares held for less than 60 days equal to 1.50% of the NAV of such shares redeemed at the time of redemption. This additional transaction fee is paid to the Fund, not to the Adviser, distributor or Transfer Agent. It is not a sales charge or a contingent deferred sales charge. The fee does not apply to redeemed shares that were purchased through reinvested dividends or capital gains distributions. The purpose of the additional transaction fee is to indirectly allocate transaction costs associated with redemptions to those investors making redemptions after holding their shares for a short period, thus protecting existing shareholders. These costs include: (1) brokerage costs; (2) market impact costs i.e., the decrease in market prices which may result when the Fund sells certain securities in order to raise cash to meet the redemption request; (3) the realization of capital gains by the other shareholders in the Fund; and (4) the effect of the bid-ask spread in the over-the-counter market. The 1.50% amount represents the Funds estimate of the brokerage and other transaction costs which may be incurred by the Fund in disposing of stocks in which the Fund may invest. Without the additional transaction fee, the Fund would generally be selling its shares at a price less than the cost to the Fund of acquiring the portfolio securities necessary to maintain its investment characteristics, resulting in reduced investment performance for all shareholders in the Fund. With the additional transaction fee, the transaction costs of selling additional stocks are not borne by all existing shareholders, but the source of funds for these costs is the transaction fee paid by those investors making redemptions. For purposes of this redemption feature, shares purchased first will be considered to be shares first redeemed.
Other Redemption Information. Redemption proceeds for shares of the Fund recently purchased by check may not be distributed until payment for the purchase has been collected, which may take up to fifteen days from the purchase date. Shareholders can avoid this delay by utilizing the wire purchase option. Redemption proceeds will ordinarily be paid within seven business days after a redemption request is received by the Transfer Agent in good order. The Fund may suspend the right of redemption or postpone the date at times when the NYSE or the bond market is closed or under any emergency circumstances as determined by the SEC.
If the Companys Board of Directors determines that it would be detrimental to the best interests of the remaining shareholders of the Fund to make payment wholly or partly in cash, redemption proceeds may be paid in whole or in part by an in-kind distribution of readily marketable securities held by the Fund instead of cash in conformity with applicable rules of the SEC. Investors generally will incur brokerage charges on the sale of portfolio securities so received in the payment of redemptions. If a shareholder receives redemption proceeds in-kind, the shareholder will bear the market risk of the securities received in the redemption until their disposition and should expect to incur transaction costs upon the disposition of the securities. The Company has elected, however, to be governed by Rule 18f-1 under the 1940 Act, so that the Fund is obligated to redeem its shares solely in cash up to the lesser of $250,000 or 1% of its NAV during any 90-day period for any one shareholder of the Fund.
Good Order. You must include complete and accurate required information on your redemption request. Please see Redemption of Fund Shares for instructions. Redemption requests not in good order may be delayed.
Involuntary Redemption. The Fund reserves the right to redeem your account at any time the value of the account falls below $500 as the result of a redemption or an exchange request.
You will be notified in writing that the value of your account is less than $500 and will be allowed 30 days to make additional investments before the redemption is processed.
The Fund may assert the right to redeem your shares at current NAV at any time and without prior notice if, and to the extent that, such redemption is necessary to reimburse the Fund for any loss sustained by reason of your failure to make full payment for shares of the Fund you previously purchased or subscribed for.
Dividends and Distributions
The Fund will distribute substantially all of the net investment income and net realized capital gains, if any, of the Fund to the Funds shareholders. All distributions are reinvested in the form of additional full and fractional shares unless you elect otherwise.
The Fund will declare and pay dividends from net investment income quarterly. Net realized capital gains (including net short-term capital gains), if any, will be distributed at least annually.
The ex-dividend, record and payable dates of any annual distribution will be available by calling [ ].
Taxes
The following is a summary of certain United States tax considerations relevant under current law, which may be subject to change in the future. Except where otherwise indicated, the discussion relates to investors who are individual United States citizens or residents. You should consult your tax adviser for further information regarding federal, state, local and/or foreign tax consequences relevant to your specific situation.
Federal Taxes of Distributions. The Fund contemplates distributing as dividends each year all or substantially all of its taxable income, including its net capital gain (the excess of net long-term capital gain over net short-term capital loss). Except as otherwise discussed below, you will be subject to federal income tax on Fund distributions regardless of whether they are paid in cash or reinvested in additional shares. Fund distributions attributable to short-term capital gains and net investment income will generally be taxable to you as ordinary income, except as discussed below.
Distributions attributable to the net capital gain of the Fund will be taxable to you as long-term capital gain, no matter how long you have owned your Fund shares. The maximum long-term capital gain rate applicable to individuals, estates, and trusts is currently 15%. You will be notified annually of the tax status of distributions to you.
Distributions of qualifying dividends will also generally be taxable to you at long-term capital gain rates, as long as certain requirements are met. In general, if 95% or more of the gross income of the Fund (other than net capital gain) consists of dividends received from domestic corporations or qualified foreign corporations (qualifying dividends), then all distributions paid by the Fund to individual shareholders will be taxed at long-term capital gains rates. But if less than 95% of the gross income of the Fund (other than net capital gain) consists of qualifying dividends, then distributions paid by the Fund to individual shareholders will be qualifying dividends only to the extent they are derived from qualifying dividends earned by the Fund. For the lower rates to apply, you must have owned your Fund shares for at least 61 days during the 121-day period beginning on the date that is 60 days before the Funds ex-dividend date (and the Fund will need to have met a similar holding period requirement with respect to the shares of the corporation paying the qualifying dividend). The amount of the Funds distributions that qualify for this favorable treatment may be reduced as a result of the Funds securities lending activities (if any), a high portfolio turnover rate or investments in debt securities or non-qualified foreign corporations.
Distributions from the Fund will generally be taxable to you in the taxable year in which they are paid, with one exception. Distributions declared by the Fund in October, November or December and paid in January of the following year are taxed as though they were paid on December 31.
A portion of distributions paid by the Fund to shareholders that are corporations may also qualify for the dividends-received deduction for corporations, subject to certain holding period requirements and debt financing limitations.
If you purchase shares just before a distribution, the purchase price will reflect the amount of the upcoming distribution, but you will be taxed on the entire amount of the distribution received, even though, as an economic matter, the distribution simply constitutes a return of capital. This is known as buying into a dividend.
Sales and Exchanges. You will generally recognize taxable gain or loss for federal income tax purposes on a sale, exchange or redemption of your shares based on the difference between your tax basis in the shares and the amount you receive for them. Generally, you will recognize long-term capital gain or loss if you have held your Fund shares for over twelve months at the time you dispose of them. (To aid in computing your tax basis, you should retain your account statements for the periods during which you held shares.)
Any loss realized on shares held for six months or less will be treated as a long-term capital loss to the extent of any capital gain dividends that were received on the shares. Additionally, any loss realized on a disposition of shares of the Fund may be disallowed under wash sale rules to the extent the shares disposed of are replaced with other shares of the Fund within a period of 61 days beginning 30 days before and ending 30 days after the shares are disposed of, such as pursuant to a dividend reinvestment in shares of the Fund. If disallowed, the loss will be reflected in an upward adjustment to the basis of the shares acquired.
IRAs and Other Tax-Qualified Plans. The one major exception to the preceding tax principles is that distributions on, and sales, exchanges and redemptions of, shares held in an IRA (or other tax-qualified plan) will not be currently taxable.
Backup Withholding. The Fund may be required in certain cases to withhold and remit to the U.S. Treasury a percentage of taxable dividends or gross proceeds realized upon sale payable to shareholders who have failed to provide a correct tax identification number in the manner required, or who are subject to withholding by the Internal Revenue Service for failure to properly include on their return payments of taxable interest or dividends, or who have failed to certify to the Fund that they are not subject to backup withholding when required to do so or that they are exempt recipients. The current withholding rate is 28%.
U.S. Tax Treatment of Foreign Shareholders. For nonresident aliens, foreign corporations and other foreign investors, Fund distributions attributable to net long-term capital gains of the Fund will generally be exempt from U.S. tax,
but all other Fund distributions will generally be subject to a 30% withholding tax. The withholding tax may, however, be reduced (and, in some cases, eliminated) under an applicable tax treaty between the United States and a shareholders country of residence or incorporation, provided that the shareholder furnishes the Fund with a properly completed Form W-8BEN to establish entitlement for these treaty benefits.
Foreign shareholders will generally not be subject to U.S. tax on gains realized on sale, exchange or redemption of shares in the Fund.
Different U.S. tax rules may apply to a foreign shareholder, however, if the investment in the Fund is connected to a trade or business of the shareholder in the United States or the investor is present in the United States for 183 days or more in a year.
All foreign investors should consult their own tax advisors regarding the tax consequences in their country of residence of an investment in the Fund.
State and Local Taxes. You may also be subject to state and local taxes on income and gain from Fund shares. State income taxes may not apply, however, to the portions of the Funds distributions, if any, that are attributable to interest on U.S. government securities. You should consult your tax adviser regarding the tax status of distributions in your state and locality.
Future Tax Treatment . Some of the tax provisions described above are subject to sunset provisions. Specifically, a sunset provision provides that the 15% long-term capital gain rate and the taxation of dividends at the long-term capital gain rate will change after 2012.
More information about taxes is contained in the Funds SAI.
Multi-Class Structure
The Fund also offers Class I shares and Class A shares through separate prospectuses. Class I shares are offered directly to institutional investors without distribution fees or sales charges. Class A shares are offered directly to individual investors and are subject to front-end sales charges and distribution fees. Shares of each class of the Fund represent equal pro rata interests in the Fund and accrue dividends and calculate NAV and performance quotations in the same manner. The performance of each class is quoted separately due to different actual expenses. The total return on Retail shares of the Fund can be expected to differ from the total return on Class I shares or Class A shares of the Fund. Information concerning other classes of the Fund can be requested by calling the Fund at [ ].
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS OR IN THE FUNDS SAI 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 THE COMPANY OR ITS DISTRIBUTOR. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING BY THE COMPANY OR BY THE DISTRIBUTOR IN ANY JURISDICTION IN WHICH SUCH OFFERING MAY NOT LAWFULLY BE MADE.
Appendix A
Prior Performance of Similarly Advised Accounts
The Adviser has experience in managing other accounts with substantially similar investment objectives, policies and strategies as the Fund. The table below is provided to illustrate the past performance of the Adviser in managing all its other similarly advised accounts and does not represent the performance of the Fund. Investors should not consider this performance information as a substitute for the performance of the Fund, nor should investors consider this information as an indication of the future performance of the Fund or of the Adviser. This performance history is net of all fees (including any applicable sales loads) charged to investors in the other accounts. The net returns are derived using the investment advisory fixed rate fee of 1.00% on total assets applicable for each other account and calculated on a monthly basis. The composite includes other accounts that pay lower expenses than those paid by shareholders of the Fund. Higher expenses reduce returns to investors. The use of the Funds expense structure would have lowered the performance results. The Funds results in the future also may be different because the other accounts are not subject to certain investment limitations, diversification requirements and other restrictions imposed on mutual funds under applicable U.S. securities and tax laws that, if applicable, could have adversely affected the performance of the other accounts. In addition, the securities held by the Fund will not be identical to the securities held by the other accounts.
The performance of the other accounts is also compared to the performance of an appropriate broad-based securities benchmark index. This index is unmanaged and is not subject to fees and expenses typically associated with managed funds, including the Fund. Investors cannot invest directly in the Index. The performance information is accompanied by additional disclosures, which are an integral part of the information.
COMPOSITE MONTHLY PERFORMANCE TABLE NET OF FEES
(SINCE INCEPTION JANUARY 14, 2011)(1),(2),(3)
|
|
Jan |
|
Feb |
|
Mar |
|
Apr |
|
May |
|
Jun |
|
Jul |
|
Aug |
|
Sep |
|
Oct |
|
Nov |
|
Dec |
|
US Equity Low Volatility Composite |
|
-1.72 |
% |
1.92 |
% |
1.97 |
% |
4.13 |
% |
0.71 |
% |
0.11 |
% |
-2.82 |
% |
-1.63 |
% |
-2.17 |
% |
4.80 |
% |
0.41 |
% |
|
|
S&P 500 ® Index |
|
-0.55 |
% |
3.20 |
% |
-0.10 |
% |
2.85 |
% |
-1.35 |
% |
-1.83 |
% |
-2.15 |
% |
-5.68 |
% |
-7.18 |
% |
10.77 |
% |
-0.51 |
% |
|
|
|
(1) |
Performance was calculated using Global Investment Performance Standards (GIPS). This method of calculating performance differs from the SECs standardized methodology, which may produce different results. |
|
|
|
|
(2) |
Performance shown is composite performance of all similarly advised accounts. The first similarly advised account commenced operations on January 14, 2011, but other accounts commenced operations subsequent to January 14, 2011. |
|
|
|
|
(3) |
The S&P 500 ® Index is an unmanaged index composed of 500 common stocks, classified in eleven industry sectors, which represents approximately 75% of the U.S. equities market. The S&P 500 ® Index assigns relative values to the stocks included in the index, weighted according to each stocks total market value relative to the total market value of the other stocks included in the index. |
THE SUMMIT GLOBAL INVESTMENTS U.S. LOW VOLATILITY EQUITY FUND
FOR MORE INFORMATION:
This prospectus contains important information you should know before you invest. Read it carefully and keep it for future reference. More information about the Fund is available free of charge, upon request, including:
Annual/Semi-Annual Reports
These reports contain additional information about the Funds investments, describe the Funds performance, list portfolio holdings, and discuss recent market conditions and economic trends. The annual report includes Fund strategies and market conditions that significantly affected the Funds performance during its last fiscal year.
Statement of Additional Information
An SAI, dated [March 1, 2012], has been filed with the SEC. The SAI, which includes additional information about the Fund, along with the Funds annual and semi-annual reports, when available, are available on [the Advisers website at www.summitglobalinvestments.com or may be obtained free of charge by calling [ ]. The SAI, as supplemented from time to time, is incorporated by reference into this prospectus and is legally considered a part of this prospectus.
Shareholder Account Service Representatives
Representatives are available to discuss account balance information, mutual fund prospectuses, literature, programs and services available. Hours: 8 a.m. to 6 p.m. (Eastern time) Monday-Friday. Call: [ ].
Purchases and Redemptions
Call your registered representative or [ ].
Written Correspondence
Post Office Address: |
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Summit Global Investments U.S. Low Volatility Equity Fund c/o BNY Mellon Investment Servicing (US) Inc. PO Box [ ] Providence, RI 02940 |
Street Address: |
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Summit Global Investments U.S. Low Volatility Equity Fund c/o BNY Mellon Investment Servicing (US) Inc. 4400 Computer Drive Westborough, MA 01581 |
Securities and Exchange Commission
You may view and copy information about the Company and the Fund, including the SAI, by visiting the SECs Public Reference Room in Washington, D.C. or the EDGAR Database on the SECs Internet site at www.sec.gov. You may also obtain copies of Fund documents by paying a duplicating fee and sending an electronic request to the following e-mail address: publicinfo@sec.gov, or by sending your written request and a duplicating fee to the SECs Public Reference Section, Washington, D.C. 20549-1520. You may obtain information on the operation of the public reference room by calling the SEC at (202) 551-8090.
INVESTMENT COMPANY ACT FILE NO. 811-05518
Subject to Completion
Preliminary Statement of Additional Information Dated [ ], 2011
STATEMENT OF ADDITIONAL INFORMATION
SUMMIT GLOBAL INVESTMENTS U.S. LOW VOLATILITY EQUITY FUND
a series of THE RBB FUND, INC.
Class A Shares Ticker Symbol: [ ]
Retail Shares Ticker Symbol: [ ]
Class I Shares Ticker Symbol: [ ]
[ ], 2011
Investment Adviser:
SUMMIT GLOBAL INVESTMENTS, LLC
This Statement of Additional Information (SAI) provides supplementary information pertaining to shares of three classes, Class A Shares, Retail Shares and Class I Shares (collectively, the Shares), representing interests in the Summit Global Investments U.S. Low Volatility Equity Fund (the Fund) of The RBB Fund, Inc. (the Company). This SAI is not a prospectus and should be read only in conjunction with the Funds Prospectuses dated [ ], 2011 (the Prospectuses). Copies of the Prospectuses may be obtained free of charge by calling toll-free (877) 264-5346.
TABLE OF CONTENTS
GENERAL INFORMATION |
1 |
INVESTMENT OBJECTIVE AND POLICIES |
1 |
INVESTMENT LIMITATIONS |
12 |
DISCLOSURE OF PORTFOLIO HOLDINGS |
13 |
MANAGEMENT OF THE COMPANY |
14 |
CODE OF ETHICS |
20 |
PROXY VOTING POLICIES |
20 |
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES |
20 |
INVESTMENT ADVISORY AND OTHER SERVICES |
21 |
INVESTMENT ADVISER |
21 |
THE PORTFOLIO MANAGERS |
22 |
ADMINISTRATION AND ACCOUNTING AGREEMENT |
22 |
CUSTODIAN AGREEMENT |
23 |
TRANSFER AGENCY AGREEMENT |
23 |
DISTRIBUTION AGREEMENT AND PLAN OF DISTRIBUTION |
23 |
FUND TRANSACTIONS |
25 |
PURCHASE AND REDEMPTION INFORMATION |
26 |
TELEPHONE TRANSACTION PROCEDURES |
29 |
VALUATION OF SHARES |
29 |
TAXES |
29 |
ADDITIONAL INFORMATION CONCERNING COMPANY SHARES |
30 |
MISCELLANEOUS |
31 |
APPENDIX A - DESCRIPTION OF SECURITIES RATINGS |
A-1 |
APPENDIX B - PROXY VOTING |
B-1 |
GENERAL INFORMATION
The Company is an open-end management investment company currently operating [18] separate portfolios. The Company is registered under the Investment Company Act of 1940, as amended, (the 1940 Act) and was organized as a Maryland corporation on February 29, 1988. This SAI pertains to the Summit Global Investments U.S. Low Volatility Equity Fund. Summit Global Investments, LLC (Summit or the Adviser), serves as the investment adviser to the Fund.
INVESTMENT OBJECTIVE AND POLICIES
The following supplements the information contained in the Prospectuses concerning the investment objective and policies of the Fund.
The Fund seeks to outperform the S&P 500 Index over a market cycle while significantly reducing the overall volatility of its portfolio through quantitative and fundamental stock selection. There can be no guarantee that the Fund will achieve its investment objective. The Fund may not necessarily invest in all of the instruments or use all of the investment techniques permitted by the Funds Prospectuses and this SAI, or invest in such instruments or engage in such techniques to the full extent permitted by the Funds investment policies and limitations.
Portfolio Turnover Rate. Portfolio turnover rate is defined under U.S. Securities and Exchange Commission (the SEC) rules as the greater of the value of the securities purchased or securities sold, excluding all securities whose maturities at the time of acquisition were one year or less, divided by the average monthly value of such securities owned during the year. Based on this definition, instruments with remaining maturities of less than one year are excluded from the calculation of the portfolio turnover rate. The Fund may at times hold investments in other short-term instruments, such as repurchase agreements, which are excluded for purposes of computing portfolio turnover.
PRINICPAL INVESTMENT POLICIES AND RISKS
Equity Securities. Equity securities represent ownership interests in a company and consist of common stocks, preferred stocks, warrants to acquire common stock, and securities convertible into common stock. Investments in equity securities in general are subject to market risks that may cause their prices to fluctuate over time. Fluctuations in the value of equity securities in which the Fund invests will cause the net asset value of the Fund to fluctuate. The Fund purchases equity securities traded in the U.S. on registered exchanges or the over-the-counter market. Equity securities are described in more detail below:
· Common Stock. Common stock represents an equity or ownership interest in an issuer. In the event an issuer is liquidated or declares bankruptcy, the claims of owners of bonds and preferred stock take precedence over the claims of those who own common stock.
· Preferred Stock. Preferred stock represents an equity or ownership interest in an issuer that pays dividends at a specified rate and that has precedence over common stock in the payment of dividends. In the event an issuer is liquidated or declares bankruptcy, the claims of owners of bonds take precedence over the claims of those who own preferred and common stock.
· Warrants. Warrants are instruments that entitle the holder to buy an equity security at a specific price for a specific period of time. Changes in the value of a warrant do not necessarily correspond to changes in the value of its underlying security. The price of a warrant may be more volatile than the price of its underlying security, and a warrant may offer greater potential for capital appreciation as well as capital loss. Warrants do not entitle a holder to dividends or voting rights with respect to the underlying security and do not represent any rights in the assets of the issuing company. A warrant ceases to have value if it is not exercised prior to its expiration date. These factors can make warrants more speculative than other types of investments.
· Convertible Securities. Convertible securities are bonds, debentures, notes, preferred stocks or other securities that may be converted or exchanged (by the holder or by the issuer) into shares of the underlying common stock (or cash or securities of equivalent value) at a stated exchange ratio. A convertible security may also be called for redemption or conversion by the issuer after a particular date and under certain circumstances (including a specified price) established upon issue. If a convertible security held by the Fund is called for redemption or conversion, the Fund could be required to tender it for redemption, convert it into the underlying common stock, or sell it to a third party.
Convertible securities generally have less potential for gain or loss than common stocks. Convertible securities generally provide yields higher than the underlying common stocks, but generally lower than comparable non-convertible securities. Because of this higher yield, convertible securities generally sell at a price above their conversion value, which is the current market value of the stock to be received upon conversion. The difference between this conversion value and the price of convertible securities will vary over time depending on changes in the value of the underlying common stocks and interest rates. When the underlying common stocks decline in value, convertible securities will tend not to decline to the same extent because of the interest or dividend payments and the repayment of principal at maturity for certain types of convertible securities. However, securities that are convertible other than at the option of the holder generally do not limit the potential for loss to the same extent as securities convertible at the option of the holder. When the underlying common stocks rise in value, the value of convertible securities may also be expected to increase. At the same time, however, the difference between the market value of convertible securities and their conversion value will narrow, which means that the value of convertible securities will generally not increase to the same extent as the value of the underlying common stocks. Because convertible securities may also be interest-rate sensitive, their value may increase as interest rates fall and decrease as interest rates rise. Convertible securities are also subject to credit risk, and are often lower-quality securities.
· Small and Medium Capitalization Issuers. Investing in equity securities of small and medium capitalization companies often involves greater risk than is customarily associated with investments in larger capitalization companies. This increased risk may be due to the greater business risks of smaller size, limited markets and financial resources, narrow product lines and frequent lack of depth of management. The securities of smaller companies are often traded in the over-the-counter market and even if listed on a national securities exchange may not be traded in volumes typical for that exchange. Consequently, the securities of smaller companies are less likely to be liquid, may have limited market stability, and may be subject to more abrupt or erratic market movements than securities of larger, more established companies or the market averages in general.
Special Note Regarding Market Events. Events in the financial sector over the past several years have resulted in reduced liquidity in credit and fixed income markets and an unusually high degree of volatility in the financial markets, both domestically and internationally. While entire markets have been impacted, issuers that have exposure to the real estate, mortgage and credit markets have been particularly affected. These events and the potential for continuing market turbulence may have an adverse effect on the Funds investments. It is uncertain how long these conditions will continue.
The instability in the financial markets has led the U.S. government to take a number of unprecedented actions designed to support certain financial institutions and certain segments of the financial markets. Federal, state and foreign governments, regulatory agencies, and self-regulatory organizations may take actions that affect the regulation of the instruments in which the Fund invests, or the issuers of such instruments, in ways that are unforeseeable. Such legislation or regulation could limit or preclude the Funds ability to achieve its investment objective.
Governments or their agencies may also acquire distressed assets from financial institutions and acquire ownership interests in those institutions. The implications of government ownership and disposition of these assets are unclear, and such ownership or disposition may have positive or negative effects on the liquidity, valuation and performance of the Fund.
NON-PRICIPAL INVESTMENT POLICIES AND RISKS
Commercial Paper. Commercial paper is the term used to designate unsecured short-term promissory notes issued by corporations and other entities. Maturities on these issues vary from a few to 270 days.
Corporate Obligations. The Fund may invest in debt obligations, such as bonds and debentures, issued by corporations and other business organizations without limit on credit quality or maturity. See Appendix A to this SAI for a description of corporate debt ratings. An issuer of debt obligations may default on its obligation to pay interest and repay principal. Also, changes in the financial strength of an issuer or changes in the credit rating of a security may affect its value.
Forward Commitment and When-Issued Transactions. The Fund may purchase or sell securities on a when-issued or forward commitment basis (subject to its investment policies and restrictions). These transactions involve a commitment by the Fund to purchase or sell securities at a future date (ordinarily one or two months later). The price of the underlying securities (usually expressed in terms of yield) and the date when the securities will be delivered and paid for (the settlement date) are fixed at the time the transaction is negotiated. When-issued purchases and forward commitments are negotiated directly with the other party, and such commitments are not traded on exchanges. The Fund will not enter into such transactions for the purpose of leverage.
When-issued purchases and forward commitments enable the Fund to lock in what is believed by the Adviser to be an attractive price or yield on a particular security for a period of time, regardless of future changes in interest rates. For instance, in periods of rising interest rates and falling prices, the Fund might sell securities it owns on a forward commitment basis to limit its exposure to falling prices. In periods of falling interest rates and rising prices, the Fund might sell securities it owns and purchase the same or a similar security on a when-issued or forward commitment basis, thereby obtaining the benefit of currently higher yields. When-issued securities or forward commitments involve a risk of loss if the value of the security to be purchased declines prior to the settlement date.
The value of securities purchased on a when-issued or forward commitment basis and any subsequent fluctuations in their value are reflected in the computation of the Funds Net Asset Value (NAV) starting on the date of the agreement to purchase the securities, and the Fund is subject to the rights and risks of ownership of the securities on that date. The Fund does not earn interest on the securities it has committed to purchase until they are paid for and delivered on the settlement date. When the Fund makes a forward commitment to sell securities it owns, the proceeds to be received upon settlement are included in the Funds assets. Fluctuations in the market value of the underlying securities are not reflected in the Funds NAV as long as the commitment to sell remains in effect. Settlement of when-issued purchases and forward commitment transactions generally takes place within two months after the date of the transaction, but the Fund may agree to a longer settlement period.
The Fund will make commitments to purchase securities on a when-issued basis or to purchase or sell securities on a forward commitment basis only with the intention of completing the transaction and actually purchasing or selling the securities. If deemed advisable as a matter of investment strategy, however, the Fund may dispose of or renegotiate a commitment after it is entered into. The Fund also may sell securities it has committed to purchase before those securities are delivered to the Fund on the settlement date. The Fund may realize a capital gain or loss in connection with these transactions, and its distributions from any net realized capital gains will be taxable to shareholders. When the Fund purchases securities on a when-issued or forward commitment basis, the Fund or the custodian will maintain in a segregated account cash or liquid securities having a value (determined daily) at least equal to the amount of the Funds purchase commitments. These procedures are designed to ensure that the Fund will maintain sufficient assets at all times to cover its obligations under when-issued purchases and forward commitments.
Futures and Options on Futures. Futures contracts provide for the future sale by one party and purchase by another party of a specified amount of a specific security at a specified future time and at a specified price. An option on a futures contract gives the purchaser the right, in exchange for a premium, to assume a position in a futures contract at a specified exercise price during the term of the option. The Fund will reduce the risk that it will be unable to close out a futures contract by only entering into futures contracts that are traded on a national futures exchange regulated by the Commodities Futures Trading Commission (CFTC). The Fund may use futures contracts and related options for: bona fide hedging; attempting to offset changes in the value of securities held or expected to be acquired or be disposed of; attempting to minimize fluctuations in foreign currencies; attempting to gain exposure to a particular market, index or instrument; or other risk management purposes. To the extent futures and/or options on futures are employed by the Fund, such use will be in accordance with Rule 4.5 of the Commodity Exchange Act (CEA). The Company, on behalf of the Fund, has filed a notice of eligibility for exclusion from the definition of the term commodity pool operator in accordance with Rule 4.5 and therefore, the Fund is not subject to registration or regulation as a commodity pool operator under the CEA.
An index futures contract is a bilateral agreement pursuant to which two parties agree to take or make delivery of an amount of cash equal to a specified dollar amount times the difference between the index value at the close of trading of the contract and the price at which the futures contract is originally struck. No physical delivery of the securities comprising the index is made; generally contracts are closed out prior to the expiration date of the contract.
When the Fund purchases or sells a futures contract, or sells an option thereon, the Fund is required to cover its position in order to limit leveraging and related risks. To cover its position, the Fund may segregate (and mark-to-market on a daily basis) cash or liquid securities that, when added to any amounts deposited with a futures commission merchant as margin, are equal to the market value of the futures contract or otherwise cover its position in a manner consistent with the 1940 Act or the rules and SEC interpretations thereunder. The segregated account functions as a practical limit on the amount of leverage which the Fund may undertake and on the potential increase in the speculative character of the Funds outstanding portfolio securities. Additionally, such segregated accounts will generally assure the availability of adequate funds to meet the obligations of the Fund arising from such investment activities.
The Fund may also cover its long position in a futures contract by purchasing a put option on the same futures contract with a strike price (i.e., an exercise price) as high or higher than the price of the futures contract. In the alternative, if the strike price of the put is less than the price of the futures contract, the Fund will segregate cash or liquid securities equal in value to the difference between the strike price of the put and the price of the futures contract. The Fund may also cover its long position in a futures contract by taking a short position in the instruments underlying the futures contract, or by taking positions in instruments with prices which are expected to move relatively consistently with the futures contract. The Fund may cover its short position in a futures contract by taking a long position in the instruments underlying the futures contracts, or by taking positions in instruments with prices which are expected to move relatively consistently with the futures contract.
The Fund may cover its sale of a call option on a futures contract by taking a long position in the underlying futures contract at a price less than or equal to the strike price of the call option. In the alternative, if the long position in the underlying futures contract is established at a price greater than the strike price of the written (sold) call, the Fund will maintain in a segregated account cash or liquid securities equal in value to the difference between the strike price of the call and the price of the futures contract. The Fund may also cover its sale of a call option by taking positions in instruments with prices which are expected to move relatively consistently with the call option. The Fund may cover its sale of a put option on a futures contract by taking a short position in the underlying futures contract at a price greater than or equal to the strike price of the put option, or, if the short position in the underlying futures contract is established at a price less than the strike price of the written put, the Fund will maintain in a segregated account cash or liquid securities equal in value to the difference between the strike price of the put and the price of the futures contract. The Fund may also cover its sale of a put option by taking positions in instruments with prices which are expected to move relatively consistently with the put option.
There are significant risks associated with the Funds use of futures contracts and related options, including the following: (1) the success of a hedging strategy may depend on the Advisers ability to predict movements in the prices of individual securities, fluctuations in markets and movements in interest rates; (2) there may be an imperfect or no correlation between the changes in market value of the securities held by the Fund and the prices of futures and options on futures; (3) there may not be a liquid secondary market for a futures contract or option; (4) trading restrictions or limitations may be imposed by an exchange; and (5) government regulations may restrict trading in futures contracts and options on futures. In addition, some strategies reduce the Funds exposure to price fluctuations, while others tend to increase its market exposure.
Illiquid Securities. Illiquid securities are securities that cannot be sold or disposed of in the ordinary course of business (within seven days) at approximately the prices at which they are valued. Because of their illiquid nature, illiquid securities must be priced at fair value as determined in good faith pursuant to procedures approved by the Companys Board of Directors. Despite such good faith efforts to determine fair value prices, the Funds illiquid securities are subject to the risk that the securitys fair value price may differ from the actual price which the Fund may ultimately realize upon its sale or disposition. Difficulty in selling illiquid securities may result in a loss or may be costly to the Fund. Under the supervision of the Companys Board of Directors, the Adviser determines the liquidity of the Funds investments. In determining the liquidity of the Funds investments, the Adviser may consider various factors, including: (1) the frequency and volume of trades and quotations; (2) the number of dealers and prospective purchasers in the marketplace; (3) dealer undertakings to make a market; and (4) the nature
of the security and the market in which it trades (including any demand, put or tender features, the mechanics and other requirements for transfer, any letters of credit or other credit enhancement features, any ratings, the number of holders, the method of soliciting offers, the time required to dispose of the security, and the ability to assign or offset the rights and obligations of the security). The Fund will not hold more than 15% of its net assets in illiquid securities.
Inflation-Protected Securities. The Fund may invest in inflation-protected securities issued by the U.S. Treasury, known as TIPs or Treasury Inflation-Protected Securities, which are debt securities whose principal and interest payments are adjusted for inflation and interest is paid on the adjusted amount. The inflation adjustment, which is typically applied monthly to the principal of the bond, follows a designated inflation index, such as the consumer price index (CPI). A fixed coupon rate is applied to the inflation-adjusted principal so that as inflation rises, both the principal value and the interest payments increase. This can provide investors with a hedge against inflation, as it helps preserve the purchasing power of the investment. Inflation-protected securities normally will decline in price when real interest rates rise. (A real interest rate is calculated by subtracting the inflation rate from a nominal interest rate. For example, if a 10-year Treasury note is yielding 5% and inflation is 2%, the real interest rate is 3%.) If inflation is negative, the principal and income of an inflation-protected security will decline and could result in losses for the Fund.
Any increase in principal for an inflation-protected security resulting from inflation adjustments is considered by Internal Revenue Service (IRS) regulations to be taxable income in the year it occurs. For direct holders of an inflation-protected security, this means that taxes must be paid on principal adjustments even though these amounts are not received until the bond matures. By contrast, the Fund holding these securities distributes both interest income and the income attributable to principal adjustments in the form of cash or reinvested shares, which are taxable to shareholders.
Initial Public Offerings. To the extent consistent with its investment policies and limitations, the Fund may purchase stock in an initial public offering (IPO). An IPO is a companys first offering of stock to the public. Risks associated with IPOs may include considerable fluctuation in the market value of IPO shares due to certain factors, such as the absence of a prior public market, unseasoned trading, a limited number of shares available for trading, lack of information about the issuer and limited operating history. The purchase of IPO shares may involve high transaction costs. When the Funds asset base is small, a significant portion of the Funds performance could be attributable to investments in IPOs, because such investments would have a magnified impact on the underlying investment company. As the Funds assets grow, the effect of the Funds investments in IPOs on the Funds performance probably will decline, which could reduce the Funds performance. Because of the price volatility of IPO shares, the Fund may choose to hold IPO shares for a very short period of time. This may increase the turnover of the Funds portfolio and may lead to increased expenses to the Fund, such as commissions and transaction costs. In addition, the Fund cannot guarantee continued access to IPOs.
Investment Company Shares. The Fund may invest in shares of other investment companies to the extent permitted by applicable law and subject to certain restrictions. These investment companies typically incur fees that are separate from those fees incurred directly by the Fund. The Funds purchase of such investment company securities results in the layering of expenses, such that shareholders would indirectly bear a proportionate share of the operating expenses of such investment companies, including advisory fees, in addition to paying the Funds expenses. Unless an exception is available, Section 12(d)(1)(A) of the 1940 Act prohibits a fund from (i) acquiring more than 3% of the voting shares of any one investment company, (ii) investing more than 5% of its total assets in any one investment company, and (iii) investing more than 10% of its total assets in all investment companies combined. These limits will not apply to the investment of uninvested cash balances in shares of registered or unregistered money market funds whether affiliated or unaffiliated. The foregoing exemption, however, only applies to an unregistered money market fund that (i) limits its investments to those in which a money market fund may invest under Rule 2a-7 of the 1940 Act, and (ii) undertakes to comply with all the other provisions of Rule 2a-7.
For hedging or other purposes, the Fund may invest in investment companies that seek to track the composition and/or performance of specific indexes or portions of specific indexes. Certain of these investment companies, known as exchange-traded funds (ETFs), are traded on a securities exchange. The market prices of index-based investments will fluctuate in accordance with changes in the underlying portfolio securities of the investment company and also due to supply and demand of the investment companys shares on the exchange upon which the shares are traded. Index-based investments may not replicate or otherwise match the composition or performance of their specified index due to transaction costs, among other things.
Investments by the Fund in other investment companies, including ETFs, will be subject to the limitations of the 1940 Act except as permitted by SEC orders. The Fund may rely on SEC orders that permit them to invest in certain ETFs beyond the limits contained in the 1940 Act, subject to certain terms and conditions. Generally, these terms and conditions require the Board to approve policies and procedures relating to certain of the Funds investments in ETFs. These policies and procedures require, among other things, that (i) the Adviser conducts the Funds investment in ETFs without regard to any consideration received by the Fund or any of its affiliated persons and (ii) the Adviser certifies to the Board quarterly that it has not received any consideration in connection with an investment by the Fund in an ETF, or if it has, the amount and purpose of the consideration will be reported to the Board and an equivalent amount of advisory fees shall be waived by the Adviser.
Certain investment companies whose securities are purchased by the Fund may not be obligated to redeem such securities in an amount exceeding 1% of the investment companys total outstanding securities during any period of less than 30 days. Therefore, such securities that exceed this amount may be illiquid.
If required by the 1940 Act, the Fund expects to vote the shares of other investment companies that are held by it in the same proportion as the vote of all other holders of such securities.
Obligations of Domestic Banks, Foreign Banks and Foreign Branches of U.S. Banks. The Fund may invest in obligations issued by banks and other savings institutions. Investments in bank obligations include obligations of domestic branches of foreign banks and foreign branches of domestic banks. Such investments in domestic branches of foreign banks and foreign branches of domestic banks may involve risks that are different from investments in securities of domestic branches of U.S. banks. These risks may include future unfavorable political and economic developments, possible withholding taxes on interest income, seizure or nationalization of foreign deposits, currency controls, interest limitations, or other governmental restrictions which might affect the payment of principal or interest on the securities held by the Fund. Additionally, these institutions may be subject to less stringent reserve requirements and to different accounting, auditing, reporting and recordkeeping requirements than those applicable to domestic branches of U.S. banks. Bank obligations include the following:
· Bankers Acceptances . Bankers acceptances are bills of exchange or time drafts drawn on and accepted by a commercial bank. Corporations use bankers acceptances to finance the shipment and storage of goods and to furnish dollar exchange. Maturities are generally six months or less.
· Certificates of Deposit . Certificates of deposit are interest-bearing instruments with a specific maturity. They are issued by banks and savings and loan institutions in exchange for the deposit of funds and normally can be traded in the secondary market prior to maturity. Certificates of deposit with penalties for early withdrawal will be considered illiquid.
· Time Deposits. Time deposits are non-negotiable receipts issued by a bank in exchange for the deposit of funds. Like a certificate of deposit, it earns a specified rate of interest over a definite period of time; however, it cannot be traded in the secondary market. Time deposits with a withdrawal penalty or that mature in more than seven days are considered to be illiquid securities.
Options. The Fund may purchase and write put and call options on securities and securities indices and enter into related closing transactions. A put option on a security gives the purchaser of the option the right to sell, and the writer of the option the obligation to buy, the underlying security at any time during the option period. A call option on a security gives the purchaser of the option the right to buy, and the writer of the option the obligation to sell, the underlying security at any time during the option period. The premium paid to the writer is the consideration for undertaking the obligations under the option contract.
Put and call options on securities indices are similar to options on securities except that options on an index give the holder the right to receive, upon exercise of the option, an amount of cash if the closing level of the underlying index is greater than (or less than, in the case of puts) the exercise price of the option. This amount of cash is equal to the difference between the closing price of the index and the exercise price of the option, expressed in dollars multiplied by a specified number. Thus, unlike options on individual securities, all settlements are in cash, and gain or loss depends on price movements in the particular market represented by the index generally, rather than the price movements in individual securities.
All options written on indices or securities must be covered. When the Fund writes an option on a security or an index, it will
establish a segregated account containing cash or liquid securities in an amount at least equal to the market value of the option and will maintain the account while the option is open or will otherwise cover the transaction.
The Fund may trade put and call options on securities and securities indices, as the Adviser determines is appropriate in seeking the Funds investment objective, and except as restricted by the Funds investment limitations. See Investment Limitations.
The initial purchase (sale) of an option contract is an opening transaction. In order to close out an option position, the Fund may enter into a closing transaction, which is simply the sale (purchase) of an option contract on the same security with the same exercise price and expiration date as the option contract originally opened. If the Fund is unable to effect a closing purchase transaction with respect to an option it has written, it will not be able to sell the underlying security until the option expires or the Fund delivers the security upon exercise.
The Fund may purchase put and call options on securities to protect against a decline in the market value of the securities in its portfolio or to anticipate an increase in the market value of securities that the Fund may seek to purchase in the future. The Fund purchasing put and call options pays a premium therefor. If price movements in the underlying securities are such that exercise of the options would not be profitable for the Fund, loss of the premium paid may be offset by an increase in the value of the Funds securities or by a decrease in the cost of acquisition of securities by the Fund.
The Fund may write covered call options on securities as a means of increasing the yield on its assets and as a means of providing limited protection against decreases in its market value. When the Fund writes an option, if the underlying securities do not increase or decrease to a price level that would make the exercise of the option profitable to the holder thereof, the option generally will expire without being exercised and the Fund will realize as profit the premium received for such option. When a call option of which the Fund is the writer is exercised, the Fund will be required to sell the underlying securities to the option holder at the strike price, and will not participate in any increase in the price of such securities above the strike price. When a put option of which the Fund is the writer is exercised, the Fund will be required to purchase the underlying securities at a price in excess of the market value of such securities.
The Fund may purchase and write options on an exchange or over-the-counter. Over-the-counter options (OTC options) differ from exchange-traded options in several respects. They are transacted directly with dealers and not with a clearing corporation, and therefore entail the risk of non-performance by the dealer. OTC options are available for a greater variety of securities and for a wider range of expiration dates and exercise prices than are available for exchange-traded options. Because OTC options are not traded on an exchange, pricing is done normally by reference to information from a market maker. It is the SECs position that OTC options are generally illiquid.
The market value of an option generally reflects the market price of an underlying security. Other principal factors affecting market value include supply and demand, interest rates, the pricing volatility of the underlying security and the time remaining until the expiration date.
Risks associated with options transactions include: (1) the success of a hedging strategy may depend on an ability to predict movements in the prices of individual securities, fluctuations in markets and movements in interest rates; (2) there may be an imperfect correlation between the movement in prices of options and the securities underlying them; (3) there may not be a liquid secondary market for options; and (4) while the Fund will receive a premium when it writes covered call options, it may not participate fully in a rise in the market value of the underlying security.
Repurchase Agreements. The Fund may enter into repurchase agreements with financial institutions. A repurchase agreement is an agreement under which the Fund acquires a fixed income security (generally a security issued by the U.S. government or an agency thereof, a bankers acceptance, or a certificate of deposit) from a commercial bank, broker, or dealer, and simultaneously agrees to resell such security to the seller at an agreed upon price and date (normally, the next business day). Because the security purchased constitutes collateral for the repurchase obligation, a repurchase agreement may be considered a loan that is collateralized by the security purchased. The acquisition of a repurchase agreement may be deemed to be an acquisition of the underlying securities as long as the obligation of the seller to repurchase the securities is collateralized fully. The Fund follows certain procedures designed to minimize the risks inherent in such agreements. These procedures include effecting repurchase transactions only with creditworthy financial institutions whose condition will be continually monitored by
the Adviser. The repurchase agreements entered into by the Fund will provide that the underlying collateral at all times shall have a value at least equal to 102% of the resale price stated in the agreement and consist only of securities permissible under Section 101(47)(A)(i) of the Bankruptcy Code (the Adviser monitors compliance with this requirement). Under all repurchase agreements entered into by the Fund, the custodian or its agent must take possession of the underlying collateral. In the event of a default or bankruptcy by a selling financial institution, the Fund will seek to liquidate such collateral. However, the exercising of the Funds right to liquidate such collateral could involve certain costs or delays and, to the extent that proceeds from any sale upon a default of the obligation to repurchase were less than the repurchase price, the Fund could suffer a loss. It is the current policy of the Fund, not to invest in repurchase agreements that do not mature within seven days if any such investment, together with any other illiquid assets held by that Fund, amounts to more than 15% of the Funds total assets. The investments of the Fund in repurchase agreements, at times, may be substantial when, in the view of the Adviser, liquidity or other considerations so warrant.
Restricted Securities. The Fund may purchase securities which are not registered under the Securities Act of 1933 (1933 Act) but which may be sold to qualified institutional buyers in accordance with Rule 144A under the 1933 Act (Restricted Securities). These securities will not be considered illiquid so long as it is determined by the Adviser that an adequate trading market exists for the securities. This investment practice could have the effect of increasing the level of illiquidity in an underlying investment company during any period that qualified institutional buyers become uninterested in purchasing restricted securities. 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).
The purchase price and subsequent valuation of Restricted Securities normally reflect a discount from the price at which such securities trade when they are not restricted, since the restriction makes them less liquid. The amount of the discount from the prevailing market price is expected to vary depending upon the type of security, the character of the issuer, the party who will bear the expenses of registering the Restricted Securities and prevailing supply and demand conditions.
As consistent with the Funds investment objective, the Fund may also invest in Section 4(2) commercial paper. Section 4(2) commercial paper is issued in reliance on an exemption from registration under Section 4(2) of the Act and is generally sold to institutional investors who purchase for investment. Any resale of such commercial paper must be in an exempt transaction, usually to an institutional investor through the issuer or investment dealers who make a market in such commercial paper. The Company believes that Section 4(2) commercial paper is liquid to the extent it meets the criteria established by the Companys Board of Directors. The Company intends to treat such commercial paper as liquid and not subject to the investment limitations applicable to illiquid securities or restricted securities.
Reverse Repurchase Agreements. The Fund may enter into reverse repurchase agreements with respect to portfolio securities for temporary purposes (such as to obtain cash to meet redemption requests) when the liquidation of portfolio securities is deemed disadvantageous or inconvenient by the Adviser. Reverse repurchase agreements involve the sale of securities held by the Fund subject to the Funds agreement to repurchase the securities at an agreed-upon price, date and rate of interest. Such agreements are considered to be borrowings under the 1940 Act and may be entered into only for temporary or emergency purposes. While reverse repurchase transactions are outstanding, the Fund will maintain in a segregated account with the Funds custodian or a qualified sub-custodian, cash or liquid 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 the Fund may decline below the price of the securities the Fund is obligated to repurchase and the interest received on the cash exchanged for the securities.
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 the 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 or 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 securitys market price such as when there is no movement in the level of the underlying security.
Risk Considerations of Medium Grade Securities. Debt o bligations in the lowest investment grade ( i.e. , BBB or Baa), referred to as medium grade obligations, have speculative characteristics, and changes in economic conditions and other factors are more likely to lead to weakened capacity to make interest payments and repay principal on these obligations than is the case for higher rated securities. In the event that a security purchased by the Fund is subsequently downgraded below investment grade, the Adviser will consider such event in its determination of whether the Fund should continue to hold the security.
Risk Considerations of Lower Rated Securities. The Fund may invest in fixed income securities that are not investment grade but are rated as low as B by Moodys or B by S&P ® (or their equivalents or, if unrated, determined by the Adviser to be of comparable credit quality). In the case of a security that is rated differently by two or more rating services, the higher rating is used in connection with the foregoing limitation. In the event that the rating on a security held in the Funds portfolio is downgraded by a rating service, such action will be considered by the Adviser in its evaluation of the overall investment merits of that security, but will not necessarily result in the sale of the security. The widespread expansion of government, consumer and corporate debt within the U.S. economy has made the corporate sector, especially cyclically sensitive industries, more vulnerable to economic downturns or increased interest rates. An economic downturn could severely disrupt the market for high yield fixed income securities and adversely affect the value of outstanding fixed income securities and the ability of the issuers to repay principal and interest.
The Fund may invest in high yield debt obligations, such as bonds and debentures, issued by corporations and other business organizations. The Fund will invest in high yield debt instruments when the Fund believes that such instruments offer a better risk/reward profile than comparable equity opportunities. High yield fixed income securities (commonly known as junk bonds) are considered speculative investments while generally providing greater income than investments in higher rated securities, involve greater risk of loss of principal and income (including the possibility of default or bankruptcy of the issuers of such securities) and may involve greater volatility of price (especially during periods of economic uncertainty or change) than securities in the higher rating categories. Since yields vary over time, no specific level of income can ever be assured.
The prices of high yield fixed income securities have been found to be less sensitive to interest rate changes than higher-rated investments but more sensitive to adverse economic changes or individual corporate developments. Also, during an economic downturn or substantial period of rising interest rates, highly leveraged issuers may experience financial stress, which would adversely affect their ability to service their principal and interest payment obligations, to meet projected business goals and to obtain additional financing. If the issuer of a fixed income security owned by the Fund defaulted, the Fund could incur additional expenses in attempting to obtain a recovery. In addition, periods of economic uncertainty and changes can be expected to result in increased volatility of market prices of high yield fixed income securities and the Funds NAV to the extent it holds such securities.
High yield fixed income securities also present risks based on payment expectations. For example, high yield fixed income securities may contain redemption or call provisions. If an issuer exercises these provisions in a declining interest rate market, the Fund may, to the extent it holds such fixed income securities, have to replace the securities with a lower yielding security, which may result in a decreased return for investors. Conversely, a high yield fixed income securitys value will decrease in a rising interest rate market, as will the value of the Funds assets, to the extent it holds such fixed income securities. In addition, to the extent that there is no established retail secondary market, there may be thin trading of high yield fixed income securities, and this may have an impact on the Advisers ability to accurately value such securities and the Funds assets and on the Funds ability to dispose of such securities. Adverse publicity and investor perceptions, whether or not based on fundamental analysis, may decrease the values and liquidity of high yield fixed income securities, especially in a thinly traded market.
New laws proposed or adopted from time to time may have an impact on the market for high yield securities.
Finally, there are risks involved in applying credit or dividend ratings as a method for evaluating high yield securities. For example, ratings evaluate the safety of principal and interest or dividend payments, not market value risk of high yield securities. Also, since rating agencies may fail to timely change the credit ratings to reflect subsequent events, the Fund will continuously
monitor the issuers of high yield securities in its portfolio, if any, to determine if the issuers will have sufficient cash flow and profits to meet required principal and interest payments, and to assure the securitys liquidity so the Fund can meet redemption requests.
Securities Lending. The Fund may lend portfolio securities to brokers, dealers and other financial organizations that meet capital and other credit requirements or other criteria established by the Companys Board of Directors. These loans, if and when made, may not exceed 33 1/3% of the total asset value of the Fund (including the loan collateral). The Fund will not lend portfolio securities to the Adviser or its affiliates unless permissible under the 1940 Act and the rules and promulgations thereunder. Loans of portfolio securities will be fully collateralized by cash, letters of credit or U.S. government securities, and the collateral will be maintained in an amount equal to at least 100% of the current market value of the loaned securities by marking to market daily. Any gain or loss in the market price of the securities loaned that might occur during the term of the loan would be for the account of the Fund.
The Fund may pay a part of the interest earned from the investment of collateral, or other fee, to an unaffiliated or, to the extent consistent with the 1940 Act or the rules and SEC interpretations thereunder, affiliated third party for acting as the Funds securities lending agent.
By lending its securities, the Fund may increase its income by receiving payments from the borrower that reflect the amount of any interest or any dividends payable on the loaned securities as well as by either investing cash collateral received from the borrower in short-term instruments or obtaining a fee from the borrower when U.S. government securities or letters of credit are used as collateral. The Fund will adhere to the following conditions whenever its portfolio securities are loaned: (i) the Fund must receive at least 100% cash collateral or equivalent securities of the type discussed in the preceding paragraph from the borrower; (ii) the borrower must increase such collateral whenever the market value of the securities rises above the level of such collateral; (iii) the Fund must be able to terminate the loan on demand; (iv) the Fund must receive reasonable interest on the loan, as well as any dividends, interest or other distributions on the loaned securities and any increase in market value; (v) the Fund may pay only reasonable fees in connection with the loan (which fees may include fees payable to the lending agent, the borrower, the Funds administrator and the custodian); and (vi) voting rights on the loaned securities may pass to the borrower, provided, however, that if a material event adversely affecting the investment occurs, the Fund must terminate the loan and regain the right to vote the securities. The Board has adopted procedures reasonably designed to ensure that the foregoing criteria will be met. Loan agreements involve certain risks in the event of default or insolvency of the borrower, including possible delays or restrictions upon the Funds ability to recover the loaned securities or dispose of the collateral for the loan, which could give rise to loss because of adverse market action, expenses and/or delays in connection with the disposition of the underlying securities.
Special Situation Companies. The Fund may invest in Special Situations. The term Special Situation shall be deemed to refer to a security of a company in which an unusual and possibly non-repetitive development is taking place which, in the opinion of the Adviser, may cause the security to attain a higher market value independently, to a degree, of the trend in the securities market in general. The particular development (actual or prospective), which may qualify a security as a Special Situation, may be one of many different types.
Such developments may include, among others, a technological improvement or important discovery or acquisition which, if the expectation for it materialized, would effect a substantial change in the companys business; a reorganization; a recapitalization or other development involving a security exchange or conversion; a merger, liquidation or distribution of cash, securities or other assets; a breakup or workout of a holding company; litigation which, if resolved favorably, would improve the value of the companys stock; a new or changed management; or material changes in management policies. A Special Situation may often involve a comparatively small company, which is not well known, and which has not been closely watched by investors generally, but it may also involve a large company. The fact, if it exists, that an increase in the companys earnings, dividends or business is expected, or that a given security is considered to be undervalued, would not in itself be sufficient to qualify as a Special Situation. The Fund may invest in securities (even if not Special Situations) which, in the opinion of the Adviser, are appropriate investments for the Fund, including securities which the Adviser believes are undervalued by the market.
U.S. Government Securities. The Fund may invest in U.S. government securities. Securities issued or guaranteed by the U.S. government or its agencies or instrumentalities include U.S. Treasury securities, which are backed by the full faith and credit of
the U.S. Treasury and which differ only in their interest rates, maturities, and times of issuance. U.S. Treasury bills have initial maturities of one-year or less; U.S. Treasury notes have initial maturities of one to ten years; and U.S. Treasury bonds generally have initial maturities of greater than ten years. Certain U.S. government securities are issued or guaranteed by agencies or instrumentalities of the U.S. government including, but not limited to, obligations of U.S. government agencies or instrumentalities such as the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac), the Government National Mortgage Association (Ginnie Mae), the Small Business Administration, the Federal Farm Credit Administration, the Federal Home Loan Banks, Banks for Cooperatives (including the Central Bank for Cooperatives), the Federal Land Banks, the Federal Intermediate Credit Banks, the Tennessee Valley Authority, the Export-Import Bank of the United States, the Commodity Credit Corporation, the Federal Financing Bank, the Student Loan Marketing Association, the National Credit Union Administration and the Federal Agricultural Mortgage Corporation (Farmer Mac).
Some obligations issued or guaranteed by U.S. government agencies and instrumentalities, including, for example, Ginnie Mae pass-through certificates, are supported by the full faith and credit of the U.S. Treasury. Other obligations issued by or guaranteed by federal agencies, such as those securities issued by Fannie Mae, are supported by the discretionary authority of the U.S. government to purchase certain obligations of the federal agency, while other obligations issued by or guaranteed by federal agencies, such as those of the Federal Home Loan Banks, are supported by the right of the issuer to borrow from the U.S. Treasury, while the U.S. government provides financial support to such U.S. government-sponsored federal agencies, no assurance can be given that the U.S. government will always do so, since the U.S. government is not so obligated by law. U.S. Treasury notes and bonds typically pay coupon interest semi-annually and repay the principal at maturity.
The extreme and unprecedented volatility and disruption that impacted the capital and credit markets during late 2008 and into 2009 have led to increased market concerns about Freddie Macs and Fannie Maes ability to withstand future credit losses associated with securities held in their investment portfolios, and on which they provide guarantees, without the direct support of the federal government. On September 6, 2008, both Freddie Mac and Fannie Mae were placed under the conservatorship of the Federal Housing Finance Agency (FHFA). Under the plan of conservatorship, the FHFA has assumed controlf of, and generally has the power to direct, the operations of Freddie Mac and Fannie Mae, and is empowered to exercise all powers collectively held by their respective shareholders, directors and officers, including the power to (1) take over the assets of and operate Freddie Mac and Fannie Mae with all the powers of the shareholders, the directors, and the officers of Freddie Mac and Fannie Mae and conduct all business of Freddie Mac and Fannie Mae; (2) collect all obligations and money due to Frddie Mac and Fannie Mae; (3) perform all functions of Freddie Mac and Fannie Mae which are consistent with the conservators appointment; (4) preserve and conserve the assets and property of Freddie Mac and Fannie Mae; and (5) contract for assistance in fulfilling any function, activity, action or duty of the conservator. In addition, in connection with the actions takekn by the FHFA, the U.S. Treasury Department (the Treasury) has entered into certain preferred stock purchase agreements with each of Freddie Mac and Fannie Mae which establish the Treasury as the holder of a new class of senior preferred stock in each of Freddie Mac and Fannie Mae, which stock was issued in connection with financial contributions from the Treasury to Freddie Mac and Fannie Mae. The conditions attached to the financial contribution made by the Treasury to Freddie Mac and Fannie Mae and the issuance of this senior preferred stock place significant restrictions on the activities of Freddie Mac and Fannie Mae. Freddie Mac and Fannie Mae must obtain the consent of the Treasury to, among other things, (i) make any payment to purchase or redeem its capital stock or pay any dividend other than in respect of the senior preferred stock, (ii) issue capital stock of any kind, (iii) terminate the conservatorship of the FHFA except in connection with a receivership , or (iv) increase its debt beyond certain specified levels. In addition, significant restrictions are placed on the maximum size of each of Freddie Macs and Fannie Maes respective portfolios of mortgages and mortgage-backed securities portfolios, and the purchase agreements entered into by Freddie Mac and Fannie Mae provide that the maximum size of their portfolios of these assets must decrease by a specified percentage each year. The future status and role of Freddie Mac and Fannie Mae could be impacted by (among other things) the actions taken and restrictions placed on Freddie Mac and Fannnie Mae by the FHFA in its role as conservator, the restrictions placed on Freddie Macs and Fannie Maes operations and activities as a result of the senior preferred stock investment made by the Treasury, market responses to developments at Freddie Mac and Fannie Mae, and future legislative and regulatory action that alters the operations, ownershp, structure and/or mission of these institutions, each of which may, in turn, impact the value of, and cash flows on any mortgage-backed securities guaranteed by Freddie Mac and Fannie Mae.
· U.S. Treasury Obligations. U.S. Treasury obligations consist of bills, notes and bonds issued by the U.S. Treasury and
separately traded interest and principal component parts of such obligations that are transferable through the federal book-entry system known as Separately Traded Registered Interest and Principal Securities (STRIPS) and Treasury Receipts (TRs).
· Receipts. Interests in separately traded interest and principal component parts of U.S. government obligations that are issued by banks or brokerage firms and are created by depositing U.S. government obligations into a special account at a custodian bank. The custodian bank holds the interest and principal payments for the benefit of the registered owners of the certificates or receipts. The custodian bank arranges for the issuance of the certificates or receipts evidencing ownership and maintains the register. TRs and STRIPS are interests in accounts sponsored by the U.S. Treasury. Receipts are sold as zero coupon securities.
· U.S. Government Zero Coupon Securities. STRIPS and receipts are sold as zero coupon securities, that is, fixed income securities that have been stripped of their unmatured interest coupons. Zero coupon securities are sold at a (usually substantial) discount and redeemed at face value at their maturity date without interim cash payments of interest or principal. The amount of this discount is accreted over the life of the security, and the accretion constitutes the income earned on the security for both accounting and tax purposes. Because of these features, the market prices of zero coupon securities are generally more volatile than the market prices of securities that have similar maturity but that pay interest periodically. Zero coupon securities are likely to respond to a greater degree to interest rate changes than are non-zero coupon securities with similar maturity and credit qualities.
· U.S. Government Agencies. Some obligations issued or guaranteed by agencies of the U.S. government are supported by the full faith and credit of the U.S. Treasury, others are supported by the right of the issuer to borrow from the Treasury, while still others are supported only by the credit of the instrumentality. Guarantees of principal by agencies or instrumentalities of the U.S. government may be a guarantee of payment at the maturity of the obligation so that in the event of a default prior to maturity there might not be a market and thus no means of realizing on the obligation prior to maturity. Guarantees as to the timely payment of principal and interest do not extend to the value or yield of these securities nor to the value of the Funds shares.
INVESTMENT LIMITATIONS
The Fund has adopted the following fundamental investment limitations which may not be changed with respect to the Fund without the affirmative vote of the holders of a majority of the Funds outstanding shares (as defined in Section 2(a) (42) of the 1940 Act). As used in this SAI and in the Prospectuses, shareholder approval and a majority of the outstanding shares of the Fund means, with respect to the approval of an investment advisory agreement, a distribution plan or a change in a fundamental investment limitation, the lesser of (1) 67% of the shares of the Fund represented at a meeting at which the holders of more than 50% of the outstanding shares of the Fund are present in person or by proxy, or (2) more than 50% of the outstanding shares of the Fund. Unless otherwise noted, the Funds investment goals and strategies described in the Prospectuses may be changed by the Companys Board of Directors without the approval of the Funds shareholders.
The Fund may not:
1. Borrow money or issue senior securities, except that the Fund may borrow from banks and enter into reverse repurchase agreements provided that there is at least 300% asset coverage for the borrowings of the Fund. The Fund may not mortgage, pledge or hypothecate any assets, except in connection with any such borrowing and then in amounts not in excess of one-third of the value of the Funds total assets at the time of such borrowing. However, the amount shall not be in excess of lesser of the dollar amounts borrowed or 33 1/3% of the value of the Funds total assets at the time of such borrowing, provided that: (a) short sales and related borrowings of securities are not subject to this restriction; and (b) for the purposes of this restriction, collateral arrangements with respect to options, short sales, futures contracts, options on futures contracts, collateral arrangements with respect to initial and variation margin and collateral arrangements with respect to derivatives instruments are not deemed to be a pledge or other encumbrance of assets. Securities held in escrow or separate accounts in connection with the Funds investment practices are not considered to be borrowings or deemed to be pledged for purposes of this limitation;
2. Act as an underwriter of securities within the meaning of the 1933 Act, except insofar as it might be deemed to be an underwriter upon disposition of certain portfolio securities acquired within the limitation on purchases of restricted securities;
3. Purchase or sell real estate (including real estate limited partnership interests), provided that the Fund may invest: (a) in securities secured by real estate or interests therein or issued by companies that invest in real estate or interests therein; or (b) in real estate investment trusts;
4. Purchase or sell commodities or commodity contracts, except that the Fund may purchase and sell options, futures contracts and related options on such futures contracts;
5. Make loans, except through loans of portfolio securities and repurchase agreements, provided that for purposes of this restriction the acquisition of bonds, debentures or other debt instruments or interests therein and investment in government obligations, loan participations and assignments, short-term commercial paper, certificates of deposit and bankers acceptances shall not be deemed to be the making of a loan;
6. Invest 25% or more of its total assets, taken at market value at the time of each investment, in the securities of one or more issuers conducting their principal business activities in the same industry, provided that (a) there is no limitation with respect to (i) instruments issued or guaranteed by the United States, any state, territory or possession of the United States, the District of Columbia or any of their authorities, agencies, instrumentalities or political subdivisions, and (ii) repurchase agreements secured by the instruments described in clause (i); (b) wholly-owned finance companies will be considered to be in the industries of their parents if their activities are primarily related to financing the activities of the parents; and (c) utilities will be divided according to their services, for example, gas, gas transmission, electric and gas, electric and telephone will each be considered a separate industry; or
7. 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 the Funds 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 Funds total assets may be invested without regard to such limitations.
In addition to the fundamental investment limitations specified above, the Fund is subject to the following non-fundamental limitations, which may be changed without shareholder approval, in compliance with applicable law and regulatory policy. The Fund may not:
1. Make investments for the purpose of exercising control or management, but investments by the Fund in wholly-owned investment entities created under the laws of certain countries will not be deemed the making of investments for the purpose of exercising control or management; or
2. Purchase securities on margin, except that the Fund may use margin to the extent necessary to engage in short sales and may obtain such short-term credits as are necessary for the clearance of portfolio transactions; and provided that margin deposits in connection with options, futures contracts, options on futures contracts or other derivative instruments shall not constitute purchasing securities on margin.
The Fund may invest in securities issued by other investment companies within the limits prescribed by the 1940 Act. As a shareholder of another investment company, the Fund would bear, along with other shareholders, its pro rata portion of the other investment companys expenses, including advisory fees. These expenses would be in addition to the advisory and other expenses that the Fund bears directly in connection with its own operations.
Securities held by the Fund generally may not be purchased from, sold or loaned to the Adviser or its affiliates or any of their directors, officers or employees, acting as principal, unless pursuant to a rule or exemptive order under the 1940 Act.
If a percentage restriction under one of the Funds investment policies or limitations or the use of assets is adhered to at the time a transaction is effected, later changes in percentages resulting from changing values will not be considered a violation (except with respect to any restrictions that may apply to borrowings or senior securities issued by the Fund).
DISCLOSURE OF PORTFOLIO HOLDINGS
The Company has adopted, on behalf of the Fund, a policy relating to the disclosure of the Funds portfolio holdings to ensure
that disclosure of information about portfolio holdings is in the best interests of Fund shareholders. The policies relating to the disclosure of the Funds portfolio holdings are designed to allow disclosure of portfolio holdings information where necessary to the Funds operation without compromising the integrity or performance of the Fund. It is the policy of the Company that disclosure of the Funds portfolio holdings to a select person or persons prior to the release of such holdings to the public (selective disclosure) is prohibited, unless there are legitimate business purposes for selective disclosure.
The Company discloses portfolio holdings information as required in regulatory filings and shareholder reports, discloses portfolio holdings information as required by federal and state securities laws and may disclose portfolio holdings information in response to requests by governmental authorities. As required by the federal securities laws, including the 1940 Act, the Company will disclose the Funds portfolio holdings in applicable regulatory filings, including shareholder reports, reports on Form N-CSR and Form N-Q or such other filings, reports or disclosure documents as the applicable regulatory authorities may require.
The Company may distribute or authorize the distribution of information about the Funds portfolio holdings that is not publicly available to its third-party service providers, which include The Bank of New York Mellon, the custodian; BNY Mellon Investment Servicing (US) Inc., the administrator, accounting agent and transfer agent; Ernst & Young, the Funds independent registered public accounting firm; Drinker Biddle & Reath LLP, legal counsel; and Merrill Corporation, the financial printer. These service providers are required to keep such information confidential, and are prohibited from trading based on the information or otherwise using the information except as necessary in providing services to the Fund. Such holdings are released on conditions of confidentiality, which include appropriate trading prohibitions. Conditions of confidentiality include confidentiality terms included in written agreements, implied by the nature of the relationship (e.g. attorney-client relationship), or required by fiduciary or regulatory principles (e.g., custody services provided by financial institutions).
Portfolio holdings may also be disclosed, upon authorization by a designated officer of the Adviser, to certain independent reporting agencies recognized by the SEC as acceptable agencies for the reporting of industry statistical information. Disclosures to financial consultants are also subject to a confidentiality agreement and/or trading restrictions as well as a 15 - day time lag. The foregoing disclosures are made pursuant to the Companys policy on selective disclosure of portfolio holdings. The Board of Directors of the Company or a committee thereof may, in limited circumstances, permit other selective disclosure of portfolio holdings subject to a confidentiality agreement and/or trading restrictions. Portfolio holdings may also be provided earlier to shareholders and their agents who receive redemptions in kind that reflect a pro rata allocation of all securities held in the Funds portfolio.
The Adviser reserves the right to refuse to fulfill any request for portfolio holdings information from a shareholder or non-shareholder if it believes that providing such information will be contrary to the best interests of the Fund.
Any violations of the policy set forth above as well as any corrective action undertaken to address such violations must be reported by the Adviser, director, officer or third party service provider to the Companys Chief Compliance Officer, who will determine whether the violation should be reported immediately to the Board of Directors of the Company or at its next quarterly Board meeting.
MANAGEMENT OF THE COMPANY
The business and affairs of the Company are managed under the direction of the Companys Board of Directors. The Company is organized under and managed pursuant to Maryland law. The Directors are responsible for deciding matters of overall policy and overseeing the actions of the Companys service providers. The officers of the Company conduct and supervise the Companys daily business operations.
The Directors and executive officers of the Company, their dates of birth, business addresses and principal occupations during the past five years are set forth below.
Name, Address, and
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Position(s)
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Term of
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Principal Occupation(s)
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Number
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Other Directorships
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DISINTERESTED DIRECTORS |
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J. Richard Carnall
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Director |
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2002 to present |
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Director of Haydon Bolts, Inc. (bolt manufacturer) and Parkway Real Estate Company (subsidiary of Haydon Bolts, Inc.) since 1984; and Director of Cornerstone Bank since March 2004. |
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[18] |
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Cornerstone Bank |
Nicholas A. Giordano 103 Bellevue Parkway Wilmington, DE 19809 DOB: 03/43 |
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Director |
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2006 to present |
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Consultant, financial services organizations from 1997 to present. |
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[18] |
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Kalmar Pooled Investment Trust; (registered investment company) WT Mutual Fund; (registered investment company) Independence Blue Cross; IntriCon Corporation (body worn device company) |
Francis J. McKay 103 Bellevue Parkway Wilmington, DE 19809 DOB: 12/35
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Director |
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1988 to present |
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Retired. |
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[18] |
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None |
Arnold M. Reichman 103 Bellevue Parkway Wilmington, DE 19809 DOB: 5/48 |
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Chairman
Director |
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2005 to present
1991 to Present |
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Director, Gabelli Group Capital Partners, L.P. (an investment partnership) from 2000 to 2006. |
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[18] |
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None |
Robert A. Straniere 103 Bellevue Parkway Wilmington, DE 19809 DOB: 3/41 |
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Director |
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2006 to present |
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Since 2009, Administrative Law Judge, New York City; Founding Partner, Straniere Law Firm (1980 to 2008); Partner, Gotham Strategies (consulting firm) (2005 to 2008); Partner, The Gotham Global Group (consulting firm) (2005 to date); President, The New York City Hot Dog Company (2005 to date); Partner, Kanter-Davidoff (law firm) (2006 to present). |
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[18] |
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Reich and Tang Group (asset management); The SPARX Asia Funds Group (registered investment company) (until 2009) |
INTERESTED DIRECTORS(2) |
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Julian A. Brodsky 103 Bellevue Parkway Wilmington, DE 19809 DOB: 7/33 |
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Director |
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1988 to present |
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Director and Vice Chairman, Comcast Corporation (cable television and communications) from 1969 to 2011. |
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[18] |
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Comcast Corporation (until 2011); AMDOCS Limited (service provider to telecommunications companies) |
Name, Address, and
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Position(s)
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Term of
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Principal Occupation(s)
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Number
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|
Other Directorships
|
Robert Sablowsky 103 Bellevue Parkway Wilmington, DE 19809 DOB: 4/38 |
|
Director |
|
1991 to present |
|
Since July 2002, Senior Vice President and prior thereto, Executive Vice President of Oppenheimer & Co., Inc. (a registered broker-dealer). |
|
18 |
|
Kensington Funds (registered investment company) (until 2009) |
OFFICERS |
||||||||||
Salvatore Faia, JD, CPA, CFE Vigilant Compliance Services
5 Christy Drive,
DOB: 12/62 |
|
President and Chief Compliance Officer |
|
President June 2009 to present and Chief Compliance Officer 2004 to present |
|
President, Vigilant Compliance Services since 2004; and Director of EIP Growth and Income Fund since 2005. |
|
N/A |
|
N/A |
Joel Weiss 103 Bellevue Parkway Wilmington, DE 19809 DOB: 1/63
|
|
Treasurer |
|
June 2009 to present |
|
Since 1993, Vice President and Managing Director, BNY Mellon Investment Servicing (US) Inc. (finance services company) |
|
N/A |
|
N/A |
Jennifer Rogers 301 Bellevue Parkway Wilmington, DE 19809 DOB: 7/74 |
|
Secretary |
|
2007 to present |
|
Since 2005, Managing Director and Senior Counsel, BNY Mellon Investment Servicing (US) Inc. (financial services company). |
|
N/A |
|
N/A |
James G. Shaw 103 Bellevue Parkway Wilmington, DE 19809 DOB: 10/60
|
|
Assistant Treasurer |
|
2005 to present |
|
Since 1995, Vice President of BNY Mellon Investment Servicing (US) Inc. (financial services company) |
|
N/A |
|
N/A |
Michael P. Malloy One Logan Square 18 th and Cherry Streets Philadelphia, PA 19103 DOB: 07/59 |
|
Assistant Secretary |
|
1999 to present |
|
Since 1993, Partner, Drinker Biddle & Reath LLP (law firm). |
|
N/A |
|
N/A |
* Each Director oversees [eighteen] portfolios of the Company that are currently offered for sale.
(1) Subject to the Companys Retirement Policy, each Director may continue to serve as a Director until the last day of the calendar year in which the applicable Director attains age 75 or until the last day of year 2011, whichever is later, or until his successor is elected and qualified or his death, resignation or removal. The Board reserves the right to waive the requirements of the Policy with respect to an individual Director. Each officer holds office at the pleasure of the Board of Directors until the next special meeting of the Company or until his or her successor is duly elected and qualified, or until he or she dies, resigns or is removed.
(2) Messrs. Brodsky and Sablowsky are considered interested persons of the Company as that term is defined in the 1940 Act and are referred to as Interested Directors. Mr. Brodsky is an Interested Director of the Company because a family foundation and certain family trusts own shares of JPMorgan Chase & Co. The investment adviser to the Companys Bear Stearns CUFS MLP Mortgage Portfolio, Bear Stearns Asset Management, Inc., is an indirect subsidiary of JPMorgan Chase. Mr. Sablowsky is considered an Interested Director of the Company by virtue of his position as an officer of Oppenheimer & Co., Inc., a registered broker-dealer.
Director Experience, Qualifications, Attributes and/or Skills
The information above includes each Directors principal occupations during the last five years. Each Director possesses extensive additional experience, skills and attributes relevant to his qualifications to serve as a Director. The cumulative background of each Director led to the conclusion that each Director should serve as a Director of the Company. Mr. Giordano has years of experience as a consultant to financial services organizations and also serves on the boards of other registered investment companies. Mr. McKay has demonstrated leadership and management abilities as a result of his senior executive positions in the healthcare industry. Mr. Reichman brings decades of investment management experience to the Board, in addition to senior executive-level management experience. Mr. Straniere has been a practicing attorney for over 30 years and has served on the board of an asset management company and another registered investment company. Mr. Brodsky has over 40 years of senior executive level management experience in the cable television and communications industry. Mr. Sablowsky has demonstrated leadership and management abilities as evidenced by his senior executive level positions in the financial services industry. Mr. Carnall has decades of senior executive-level management experience in the banking and financial services industry and also serves on the boards of various corporations and a bank.
Standing Board Committees
The responsibilities of each Committee of the Board and its members are described below.
Audit Committee. The Board has an Audit Committee comprised of one Interested Director and three Independent Directors. The current members of the Audit Committee are Messrs. Brodsky, Giordano, McKay and Reichman. The Audit Committee, among other things, reviews results of the annual audit and approves the firm(s) to serve as independent auditors.
Executive Committee. The Board has an Executive Committee comprised of one Interested Director and two Independent Directors. The current members of the Executive Committee are Messrs. Giordano, Reichman and Sablowsky. The Executive Committee may generally carry on and manage the business of the Company when the Board of Directors is not in session.
Nominating and Governance Committee. The Board has a Nominating and Governance Committee comprised only of Independent Directors. The current members of the Nominating and Governance Committee are Messrs. Carnall, Giordano, McKay and Reichman. The Nominating and Governance Committee recommends to the Board of Directors all persons to be nominated as Directors of the Company. The Nominating and Governance Committee will consider nominees recommended by shareholders. Recommendations should be submitted to the Committee care of the Companys Secretary.
Regulatory Oversight Committee . The Board has a Regulatory Oversight Committee compromised of two Interested Directors and two Independent Directors. The current members of the Regulatory Oversight Committee are Messrs. Carnall, Reichman, Sablowsky and Straniere. The Regulatory Oversight Committee monitors regulatory developments in the mutual fund industry and focuses on various regulatory aspects of the operation of the Company.
Risk Oversight
The Board of Directors performs its risk oversight function for the Company through a combination of (1) direct oversight by the Board as a whole and Board Committees and (2) indirect oversight through the Companys investment advisers and other service providers, Company officers and the Companys Chief Compliance Officer. The Company is subject to a number of risks, including but not limited to investment risk, compliance risk, operational risk, reputational risk, credit risk and counterparty risk. Day-to-day risk management with respect to the Company is the responsibility of the Companys investment advisers or other service providers (depending on the nature of the risk) that carry out the Companys investment management and business affairs. Each of the investment advisers and the other service providers have their own independent interest in risk management and their policies and methods of risk management will depend on their functions and business models and may differ from the Companys and each others in the setting of priorities, the resources available or the effectiveness of relevant controls.
The Board provides risk oversight by receiving and reviewing on a regular basis reports from the Companys investment advisers or other service providers, receiving and approving compliance policies and procedures, periodic meetings with
the Companys portfolio managers to review investment policies, strategies and risks, and meeting regularly with the Companys Chief Compliance Officer to discuss compliance reports, findings and issues. The Board also relies on the Companys investment advisers and other service providers, with respect to the day-to-day activities of the Company, to create and maintain procedures and controls to minimize risk and the likelihood of adverse effects on the Companys business and reputation.
Board oversight of risk management is also provided by various Board Committees. For example, the Audit Committee meets with the Companys independent registered public accounting firms to ensure that the Companys respective audit scopes include risk-based considerations as to the Companys financial position and operations.
The Board may, at any time and in its discretion, change the manner in which it conducts risk oversight. The Boards oversight role does not make the Board a guarantor of the Companys investments or activities.
Director Ownership of Shares of the Company
The following table sets forth the dollar range of equity securities beneficially owned by each Director in the Fund and in all of the portfolios (which for each Director comprise all registered investment companies within the Companys family of investment companies overseen by him), as of December 31, 2010.
Name of Director |
|
Dollar Range of
|
|
Aggregate Dollar Range of
|
|
|
|
|
|
INDEPENDENT DIRECTORS |
||||
J. Richard Carnall |
|
None |
|
|
|
|
|
|
|
Nicholas A. Giordano |
|
None |
|
|
|
|
|
|
|
Francis J. McKay |
|
None |
|
|
|
|
|
|
|
Arnold M. Reichman |
|
None |
|
|
|
|
|
|
|
Marvin E. Sternberg* |
|
None |
|
|
|
|
|
|
|
Robert A. Straniere |
|
None |
|
|
|
|
|
|
|
INTERESTED DIRECTORS |
||||
Julian A. Brodsky |
|
None |
|
|
|
|
|
|
|
Robert Sablowsky |
|
None |
|
|
* Mr. Sternberg died on October 29, 2011.
Directors and Officers Compensation
Effective February 1, 2010, the Company pays each Director a retainer of at the rate of $17,500 annually, $3,500 for each regular meeting of the Board of Directors, $1,500 for each special meeting of the Board of Directors and Committee meeting attended in person and $1,000 for each special meeting of the Board of Directors and Committee meeting attended telephonically. From July 1, 2009 to February 1, 2010, the Company paid each Director a retainer at the rate of $17,500 annually, $3,000 for each regular meeting of the Board of Directors, $1,500 for each special meeting of the Board of Directors attended in person, $1,000 for each Committee meeting attended in person, $1,000 for each special meeting of
the Board of Directors and Committee meeting attended telephonically lasting one hour or longer and $500 for each special meeting of the Board of Directors or Committee meeting attended telephonically lasting for less than one hour. From October 1, 2008 to July 1, 2009, the Company paid each Director a retainer at the rate of $17,500 annually, $3,500 for each regular meeting of the Board of Directors, $1,500 for each special meeting of the Board of Directors and Committee meeting attended in person and $1,000 for each special meeting of the Board of Directors and Committee meeting attended telephonically. From March 1, 2008 to October 1, 2008 the Company paid each Director a retainer at the rate of $17,500 annually, $3,500 for each regular meeting of the Board of Directors and $500 for each special meeting of the Board of Directors and Committee meeting lasting up to one hour or $1,500 for each special meeting of the Board of Directors and Committee meeting lasting over one hour attended by a Director or in which he participated, whether or not it was held in conjunction with a Board meeting. From May 23, 2007 to March 1, 2008 the Company paid each Director a retainer at the rate of $17,500 annually, $3,500 per meeting of the Board of Directors and $500 for each committee meeting lasting up to one hour or $1,500 for each committee meeting lasting over one hour attended by a Director or in which he participates, whether or not it is held in conjunction with a Board meeting. Prior to November 15, 2007, no Director was paid for a committee meeting if it was held in conjunction with a Board meeting. Effective February 1, 2010, the Chairman of the Board receives an additional fee of $12,000 per year for his services in this capacity, and each Chairman of the Audit Committee, Nominating and Governance Committee and Regulatory Oversight Committee receives an additional fee of $4,000 per year for his services. From July 1, 2009 to February 1, 2010, the Chairman of the Board received an additional fee of $9,000 per year for his services in this capacity, and each Chairman of the Audit Committee, Nominating and Governance and Regulatory Oversight Committee received an additional fee of $3,000 per year for his services.
Directors are reimbursed for any reasonable out-of-pocket expenses incurred in attending meetings of the Board of Directors or any committee thereof. The Company also compensates its President and Chief Compliance Officer for his services to the Company. For the fiscal year ended August 31, 2011, each of the following members of the Board of Directors and the President and Chief Compliance Officer received compensation from the Company in the following amounts:
Name of Director/Officer |
|
Aggregate
|
|
Pension or
|
|
Estimated
|
|
Total
|
|
||
|
|
|
|
|
|
|
|
|
|
||
Independent Directors: |
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
||
J. Richard Carnall, Director |
|
$ |
[ ] |
|
N/A |
|
N/A |
|
$ |
[ ] |
|
|
|
|
|
|
|
|
|
|
|
||
Nicholas A. Giordano, Director |
|
$ |
[ ] |
|
N/A |
|
N/A |
|
$ |
[ ] |
|
|
|
|
|
|
|
|
|
|
|
||
Francis J. McKay, Director |
|
$ |
[ ] |
|
N/A |
|
N/A |
|
$ |
[ ] |
|
|
|
|
|
|
|
|
|
|
|
||
Arnold M. Reichman, Director and Chairman |
|
$ |
[ ] |
|
N/A |
|
N/A |
|
$ |
[ ] |
|
|
|
|
|
|
|
|
|
|
|
||
*Marvin E. Sternberg, Director |
|
$ |
[ ] |
|
N/A |
|
N/A |
|
$ |
[ ] |
|
|
|
|
|
|
|
|
|
|
|
||
Robert A. Straniere, Director |
|
$ |
[ ] |
|
N/A |
|
N/A |
|
$ |
[ ] |
|
|
|
|
|
|
|
|
|
|
|
||
Interested Directors: |
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
||
Julian A. Brodsky, Director |
|
$ |
[ ] |
|
N/A |
|
N/A |
|
$ |
[ ] |
|
|
|
|
|
|
|
|
|
|
|
||
Robert Sablowsky, Director |
|
$ |
[ ] |
|
N/A |
|
N/A |
|
$ |
[ ] |
|
Name of Director/Officer |
|
Aggregate
|
|
Pension or
|
|
Estimated
|
|
Total
|
|
||
|
|
|
|
|
|
|
|
|
|
||
Officers: |
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
||
Salvatore Faia, Esquire, CPA Chief Compliance Officer and President |
|
$ |
[ ] |
|
N/A |
|
N/A |
|
$ |
[ ] |
|
* Mr. Sternberg died on October 29, 2011.
As of December 31, 2010, the Independent Directors and their respective immediate family members (spouse or dependent children) did not own beneficially or of record any securities of the Companys investment advisers or distributor, or of any person directly or indirectly controlling, controlled by, or under common control with the investment advisers or distributor.
On October 24, 1990, the Company adopted, as a participating employer, the Fund Office Retirement Profit-Sharing Plan and Trust Agreement, a retirement plan for employees, pursuant to which the Company will contribute on a quarterly basis amounts equal to 10% of the quarterly compensation of each eligible employee. Edward J. Roach, who served as President and Treasurer of the Company until June 1, 2009, has been the only employee who has participated in the Fund Office Retirement Profit-Sharing Plan and Trust Agreement. No officer, Director or employee of the Adviser or the distributor currently receives any compensation from the Company.
CODE OF ETHICS
The Company, the Adviser and BNY Mellon Distributors Inc. (BNY Distributors) have each adopted a code of ethics under Rule 17j-1 of the 1940 Act that permits personnel subject to the codes to invest in securities, including securities that may be purchased or held by the Company.
PROXY VOTING
The Board of Directors has delegated the responsibility of voting proxies with respect to the portfolio securities purchased and/or held by the Fund to the Funds Adviser, subject to the Boards continuing oversight. In exercising its voting obligations, the Adviser is guided by its general fiduciary duty to act prudently and in the interest of the Fund. The Adviser will consider factors affecting the value of the Funds investments and the rights of shareholders in its determination on voting portfolio securities.
The Adviser will vote proxies in accordance with its proxy policies and procedures, which are included in Appendix B to this SAI.
The Company is required to disclose annually the Funds complete proxy voting record on Form N-PX. The Funds proxy voting record for the most recent 12 month period ended June 30th will be available upon request by calling [ ] or by writing to the Fund, P.O. Box [ ], [ADDRESS]. The Funds Form N-PX will also be available on the SECs website at www.sec.gov.
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
The Fund was not previously in operation and consequently, there are no shareholders as of the date of this SAI.
INVESTMENT ADVISORY AND OTHER SERVICES
INVESTMENT ADVISER
Summit Global Investments, LLC (Summit or the Adviser) is a Limited Liability Company registered with the State of Utah in October 2010. The Adviser is 100% employee-owned and is controlled by David Harden.
Advisory Agreement with the Company. The Adviser renders advisory services to the Fund pursuant to an Investment Advisory Agreement (Advisory Agreement) dated as of [ ], 2011.
Subject to the supervision of the Companys Board of Directors, the Adviser will provide for the overall management of the Fund including (i) the provision of a continuous investment program for the Fund, including investment research and management with respect to all securities, investments, cash and cash equivalents, (ii) the determination from time to time of the securities and other investments to be purchased, retained, or sold by the Fund, and (iii) the placement from time to time of orders for all purchases and sales of securities and other investments made for the Fund. The Adviser will provide the services rendered by it in accordance with the Funds investment objective, restrictions and policies as stated in the Prospectuses and in this SAI. The Adviser will not be liable for any error of judgment, mistake of law, or for any loss suffered by the Fund in connection with the performance of the Advisory Agreement, 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 Adviser in the performance of its duties, or from reckless disregard of its obligations and duties under the Advisory Agreement.
For its services to the Fund, the Adviser is entitled to an advisory fee computed daily and payable monthly at the annual rate of 0.70% of the Funds average daily net assets. The Adviser has contractually agreed to waive its management fees and reimburse expenses through [March 1, 2013], to the extent that the Funds total annual operating expenses (excluding acquired fund fees and expenses, brokerage commissions, extraordinary items, interest and taxes) exceed 1.23% for Class A Shares, 1.23% for Retail Shares and 0.98% for Class I Shares.
The Adviser will pay all expenses incurred by it in connection with its activities under the Advisory Agreement. The Fund bears all of its own expenses not specifically assumed by the Adviser. General expenses of the Company not readily identifiable as belonging to a portfolio of the Company are allocated among all investment portfolios by or under the direction of the Companys Board of Directors in such manner as it deems to be fair and equitable. Expenses borne by the Fund include, but are not limited to the following (or the Funds share of the following): (a) the cost (including brokerage commissions) of securities purchased or sold by the Fund and any losses incurred in connection therewith; (b) fees payable to and expenses incurred on behalf of the Fund by the Adviser; (c) filing fees and expenses relating to the registration and qualification of the Company and the Funds shares under federal and/or state securities laws and maintaining such registrations and qualifications; (d) fees and salaries payable to the Companys Directors and officers; (e) taxes (including any income or franchise taxes) and governmental fees; (f) costs of any liability and other insurance or fidelity bonds; (g) any costs, expenses or losses arising out of a liability of or claim for damages or other relief asserted against the Company or the Fund 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 materials 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 portfolios securities; and (p) the costs of investment company literature and other publications provided by the Company 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 Company, are allocated to such class.
Disclosure relating to the material factors and the conclusions with respect to those factors that formed the basis for the Board of Directors approval of the Funds investment advisory agreement will be available in the Funds first report to shareholders following commencement of operations and may be obtained by calling [ ] or visiting the SECs website at www.sec.gov.
The Advisory Agreement provides that the Adviser shall at all times have all rights in and to the Funds name and all investment models used by or on behalf of the Fund. The Adviser may use the Funds name or any portion thereof in connection with any
other mutual fund or business activity without the consent of any shareholder, and the Company has agreed to execute and deliver any and all documents required to indicate its consent to such use.
THE PORTFOLIO MANAGER(S)
This section includes information about the Funds portfolio manager, including information about other accounts he manages, the dollar range of Fund shares he owns and how he is compensated.
Summit
Other Accounts. In addition to the Fund, the portfolio manager is responsible for the day-to-day management of certain other accounts, as listed below. The information below is provided as of November 30, 2011.
Name of Portfolio Manager
|
|
Type of Accounts |
|
Total
|
|
Total
|
|
# of Accounts
|
|
Total Assets
|
|
||
1. David Harden |
|
Other Registered Investment Companies: |
|
9 |
|
~$ |
2MM |
|
0 |
|
$ |
0 |
|
|
|
Other Pooled Investment Vehicles: |
|
0 |
|
$ |
0 |
|
0 |
|
$ |
0 |
|
|
|
Other Accounts: |
|
0 |
|
$ |
0 |
|
0 |
|
$ |
0 |
|
The Adviser compensates the Funds portfolio manager for his management of the Fund. The portfolio manager is compensated through equity ownership of the Adviser, adjusted to reflect current market rates, and therefore compensation is in part based on the value of the Funds net assets and other client accounts he is managing. The Advisers Board of Managers reviews the compensation of each portfolio manager periodically and may make modifications in compensation as it deems necessary to reflect changes in the market.
The portfolio managers management of other accounts may give rise to potential conflicts of interest in connection with his management of the Funds investments, on the one hand, and the investments of the other accounts, on the other. The other accounts may have the same investment objective as the Fund. Therefore, a potential conflict of interest may arise as a result of the identical investment objectives, whereby a portfolio manager could favor one account over another. Another potential conflict could include the portfolio managers knowledge about the size, timing and possible market impact of Fund trades, whereby a portfolio manager could use this information to the advantage of other accounts and to the disadvantage of the Fund. However, the Adviser has established policies and procedures to ensure that the purchase and sale of securities among all accounts it manages are fairly and equitably allocated.
ADMINISTRATION AND ACCOUNTING AGREEMENT
BNY Mellon Investment Servicing (U.S.) Inc. (BNY Mellon), 301 Bellevue Parkway, Wilmington, Delaware 1980_serves as administrator to the Fund pursuant to administration and accounting services agreements dated [ 2011] with respect to the Fund (the Administration Agreements). BNY Mellon has agreed to furnish to the Fund statistical and research data, clerical, accounting and bookkeeping services, and certain other services required by the Fund. In addition, BNY Mellon has agreed to prepare and file various reports with the appropriate regulatory agencies and prepare materials required by the SEC or any state securities commission having jurisdiction over the Fund. The Administration Agreement provides that BNY Mellon shall be obligated to exercise care and diligence in the performance of its duties, to act in good faith and to use its best efforts, within reasonable limits, in performing services thereunder. BNY Mellon shall be responsible for failure to perform its duties under the Administration Agreement arising out of its willful misfeasance, bad faith, gross negligence or reckless disregard. For its services to the Fund, BNY Mellon is entitled to receive a fee calculated at an annual rate of [ ]:
The minimum monthly fee will be [$ ] per month, exclusive of Rule 38a-1 base compliance support services fees, costs of obtaining independent security market quotes, data repository and analytics suite access fees and out-of-pocket expenses.
The Administration Agreement provides that BNY Mellon shall not be liable for any error of judgment or mistake of law or any loss suffered by the Company or the Fund in connection with the performance of the agreement, except a loss resulting from willful misfeasance, gross negligence or reckless disregard by it of its duties and obligations thereunder.
On June 1, 2003, the Company entered into a regulatory administration services agreement with BNY Mellon. Under this agreement, BNY Mellon has agreed to provide regulatory administration services to the Company. These services include the preparation and coordination of the Companys annual post-effective amendment filing and supplements to the Funds registration statement, the preparation and assembly of board meeting materials, and certain other services necessary to the Companys regulatory administration. BNY Mellon receives an annual fee based on the average daily net assets of the portfolios of the Company.
CUSTODIAN AGREEMENT
The Bank of New York (the Custodian), One Wall Street, New York, New York 10286, is custodian of the Funds assets pursuant to a custodian agreement dated July 19, 2011. Under the Custodian Agreement, the Custodian: (a) maintains a separate account or accounts in the name of the Fund; (b) holds and transfers portfolio securities on account of the Fund; (c) accepts receipts and makes disbursements of money on behalf of the Fund; (d) collects and receives all income and other payments and distributions on account of the Funds portfolio securities; and (e) makes periodic reports to the Companys Board of Directors concerning the Funds operations. The Custodian is authorized to select one or more banks or trust companies to serve as sub-custodian on behalf of the Fund, provided that the Custodian remains responsible for the performance of all of its duties under the Custodian Agreement and holds the Fund harmless from the acts and omissions of any affiliate, sub-custodian or domestic sub-custodian. [For its services to the Fund under the Custodian Agreement, the Custodian receives a fee of % of average daily gross assets of the Fund calculated daily and payable monthly, or a minimum monthly fee of $[ ], exclusive of transaction charges and out-of-pocket expenses, which are also charged to the Fund.]
TRANSFER AGENCY AGREEMENT
BNY Mellon also serves as the transfer and dividend disbursing agent for the Fund pursuant to a transfer agency agreement dated November 5, 1991, as supplemented (the Transfer Agency Agreement), under which BNY Mellon: (a) issues and redeems shares of the Fund; (b) addresses and mails all communications by the Fund to record owners of the shares, 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 the Companys Board of Directors concerning the operations of the Fund. BNY Mellon may, on 30 days notice to the Company, assign its duties as transfer and dividend disbursing agent to any affiliate . [For its services to the Fund under the Transfer Agency Agreement, BNY Mellon receives a fee at the annual rate of $[ ] per direct account, $[ ] in the Fund, with a minimum monthly fee of $[ ] per class payable monthly on a pro rata basis, exclusive of out-of-pocket expenses, and also receives reimbursement of its out-of-pocket expenses.]
BNY Mellon also provides services relating to the implementation of the Companys Anti-Money Laundering Program. The Company pays an annual fee, ranging from $3,000 - $50,000, based on the number of open accounts in each portfolio of the Company. In addition, BNY Mellon provides services relating to the implementation of the Funds Customer Identification Program, including verification of required customer information and the maintenance of records with respect to such verification. [The Fund will pay BNY Mellon $[ ] per customer verification and $[ ] per month per record result maintained.]
DISTRIBUTION AGREEMENT AND PLAN OF DISTRIBUTION
BNY Mellon Distributors, Inc. (BNY Mellon Distributors) whose principal business address is 760 Moore Road, King of Prussia, Pennsylvania 19406, serves as the underwriter to the Fund pursuant to the terms of a distribution agreement, dated as of January 2, 2001, as supplemented (the Distribution Agreement).
Class I Shares . Pursuant to the Distribution Agreement, BNY Mellon Distributors will use appropriate effort to solicit orders for the sale of the Funds shares. BNY Mellon Distributors does not receive compensation from the Company for the distribution of the Funds Class I shares; however, the Adviser pays an annual fee to BNY Mellon Distributors as compensation
for underwriting services rendered to the Fund pursuant to the Distribution Agreement.
Class A Shares and Retail Shares . Pursuant to the Distribution Agreement and the related Plans of Distribution for Class A Shares and Retail shares (together, the Plans), which were adopted by the Company in the manner prescribed by Rule 12b-1 under the 1940 Act, BNY Mellon Distributors will use appropriate efforts to solicit orders for the sale of the Funds Class A Shares and Retail shares, respectively, shares. Payments to BNY Mellon Distributors under the Plans are to compensate it for distribution assistance and expenses assumed and activities intended to result in the sale of Class A Shares and Retail shares, including advertising, printing and mailing of prospectuses to others than current shareholders, compensation of underwriters, compensation to broker-dealers, compensation to sales personnel, and interest, carrying or other financing changes. As compensation for its distribution services, BNY Mellon Distributors receives, pursuant to the terms of the Distribution Agreement, a distribution fee under the Plans, to be calculated daily and paid monthly by the Class A Shares and Retail shares of the Fund at the annual rates set forth in the Class A Shares Prospectus and Retail shares Prospectus, respectively.
Among other things, the Plans provide that: (1) BNY Mellon Distributors shall be required to submit quarterly reports to the Directors of the Company regarding all amounts expended under the Plans and the purposes for which such expenditures were made, including commissions, advertising, printing, interest, carrying charges and any allocated overhead expenses; (2) the Plans will continue in effect only so long as they are approved at least annually, and any material amendment thereto is approved, by the Companys Directors, including a majority of those Directors who are not interested persons (as defined in the 1940 Act) and who have no direct or indirect financial interest in the operation of the Plans or any agreements related to the Plans, acting in person at a meeting called for said purpose; (3) the aggregate amount to be spent by the Fund on the distribution of the Funds Class A Shares and Retail shares under the respective Plans shall not be materially increased without shareholder approval; and (4) while the Plans remain in effect, the selection and nomination of the Companys Directors who are not interested persons of the Company (as defined in the 1940 Act) shall be committed to the discretion of such Directors who are not interested persons of the Company.
Mr. Sablowsky, a Director of the Company, has an indirect interest in the operation of the Plans by virtue of his position with Oppenheimer Co., Inc., a broker-dealer.
PAYMENTS TO FINANCIAL INTERMEDIARIES
The Adviser and/or its affiliates, at their discretion, may make payments from their own resources and not from Fund assets to affiliated or unaffiliated brokers, dealers, banks (including bank trust departments), trust companies, registered investment advisers, financial planners, retirement plan administrators, insurance companies, and any other institution having a service, administration, or any similar arrangement with the Fund, its service providers or their respective affiliates, as incentives to help market and promote the Fund and/or in recognition of their distribution, marketing, administrative services, and/or processing support.
These additional payments may be made to financial intermediaries that sell Fund shares or provide services to the Fund, the Distributor or shareholders of the Fund through the financial intermediarys retail distribution channel and/or fund supermarkets. Payments may also be made through the financial intermediarys retirement, qualified tuition, fee-based advisory, wrap fee bank trust, or insurance (e.g., individual or group annuity) programs. These payments may include, but are not limited to, placing the Fund in a financial intermediarys retail distribution channel or on a preferred or recommended fund list; providing business or shareholder financial planning assistance; educating financial intermediary personnel about the Fund; providing access to sales and management representatives of the financial intermediary; promoting sales of Fund shares; providing marketing and educational support; maintaining share balances and/or for sub-accounting, administrative or shareholder transaction processing services. A financial intermediary may perform the services itself or may arrange with a third party to perform the services.
The Adviser and/or its affiliates may also make payments from their own resources to financial intermediaries for costs associated with the purchase of products or services used in connection with sales and marketing, participation in and/or presentation at conferences or seminars, sales or training programs, client and investor entertainment and other sponsored events. The costs and expenses associated with these efforts may include travel, lodging, sponsorship at educational seminars
and conferences, entertainment and meals to the extent permitted by law.
Revenue sharing payments may be negotiated based on a variety of factors, including the level of sales, the amount of Fund assets attributable to investments in the Fund by financial intermediaries customers, a flat fee or other measures as determined from time to time by the Adviser and/or its affiliates. A significant purpose of these payments is to increase the sales of Fund shares, which in turn may benefit the Adviser through increased fees as Fund assets grow.
FUND TRANSACTIONS
Subject to policies established by the Board of Directors and applicable rules, the Adviser is responsible for the execution of portfolio transactions and the allocation of brokerage transactions for the Fund. In executing portfolio transactions, the Adviser seeks to obtain the best price and most favorable execution for the Fund, 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 the Adviser 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.
Brokerage Transactions.
Generally, equity securities, both listed and over-the-counter, are bought and sold through brokerage transactions for which commissions are payable. Purchases from underwriters will include the underwriting commission or concession, and purchases from dealers serving as market makers will include a dealers mark-up or reflect a dealers mark-down. Money market securities and other debt securities are usually bought and sold directly from the issuer or an underwriter or market maker for the securities. Generally, the Fund will not pay brokerage commissions for such purchases. When a debt security is bought from an underwriter, the purchase price will usually include an underwriting commission or concession. The purchase price for securities bought from dealers serving as market makers will similarly include the dealers mark up or reflect a dealers mark down. When the Fund executes transactions in the over-the-counter market, it will generally deal with primary market makers unless prices that are more favorable are otherwise obtainable.
In addition, the Adviser may place a combined order for two or more accounts they manage, including the Fund, engaged in the purchase or sale of the same security if, in its judgment, joint execution is in the best interest of each participant and will result in best price and execution. Transactions involving commingled orders are allocated in a manner deemed equitable to each account and the fund. Although it is recognized that, in some cases, the joint execution of orders could adversely affect the price or volume of the security that a particular account or the Fund may obtain, it is the opinion of the Adviser and the Companys Board of Directors that the advantages of combined orders outweigh the possible disadvantages of separate transactions. Nonetheless, the Adviser believes that the ability of the Fund to participate in higher volume transactions will generally be beneficial to the Fund.
Brokerage Selection.
The Company does not expect to use one particular broker or dealer, and when one or more brokers is believed capable of providing the best combination of price and execution, the Funds Adviser may select a broker based upon brokerage or research services provided to the Adviser. The Adviser may pay a higher commission than otherwise obtainable from other brokers in return for such services only if a good faith determination is made that the commission is reasonable in relation to the services provided.
Section 28(e) of the Securities Exchange Act of 1934 Act permits an investment adviser, under certain circumstances, to cause a fund to pay a broker or dealer a commission for effecting a transaction in excess of the amount of commission another broker or dealer would have charged for effecting the transaction in recognition of the value of brokerage and research services provided by the broker or dealer. In addition to agency transactions, the Adviser may receive brokerage and research services in connection with certain riskless principal transactions, in accordance with applicable SEC guidance. Brokerage and research services include: (1) furnishing advice as to the value of securities, the advisability of investing in, purchasing or selling securities, and the availability of securities or purchasers or sellers of securities; (2) furnishing analyses and reports concerning issuers, industries, securities, economic factors and trends, portfolio strategy, and the performance of accounts; and (3) effecting
securities transactions and performing functions incidental thereto (such as clearance, settlement, and custody). In the case of research services, the Adviser believes that access to independent investment research is beneficial to their investment decision-making processes and, therefore, to the Fund.
To the extent research services may be a factor in selecting brokers, such services may be in written form or through direct contact with individuals and may include information as to particular companies and securities as well as market, economic, or institutional areas and information which assists in the valuation and pricing of investments. Examples of research-oriented services for which the Adviser might utilize Fund commissions include research reports and other information on the economy, industries, sectors, groups of securities, individual companies, statistical information, political developments, technical market action, pricing and appraisal services, credit analysis, risk measurement analysis, performance and other analysis. The Adviser may use research services furnished by brokers in servicing all client accounts and not all services may necessarily be used in connection with the account that paid commissions to the broker providing such services. Information so received by the Adviser will be in addition to and not in lieu of the services required to be performed by the Adviser under the Advisory Agreement. Any advisory or other fees paid to the Adviser are not reduced as a result of the receipt of research services.
In some cases the Adviser may receive a service from a broker that has both a research and a non-research use. When this occurs, the Adviser makes a good faith allocation, under all the circumstances, between the research and non-research uses of the service. The percentage of the service that is used for research purposes may be paid for with client commissions, while the Adviser will use its own funds to pay for the percentage of the service that is used for non-research purposes. In making this good faith allocation, the Adviser faces a potential conflict of interest, but the Adviser believes that its allocation procedures are reasonably designed to ensure that it appropriately allocates the anticipated use of such services to their research and non-research uses.
From time to time, the Fund may purchase new issues of securities for clients in a fixed price offering. In these situations, the seller may be a member of the selling group that will, in addition to selling securities, provide the Adviser with research services. The Financial Industry Regulatory Authority (FINRA) has adopted rules expressly permitting these types of arrangements under certain circumstances. Generally, the seller will provide research credits in these situations at a rate that is higher than that which is available for typical secondary market transactions. These arrangements may not fall within the safe harbor of Section 28(e).
PURCHASE AND REDEMPTION INFORMATION
Read the Funds Prospectuses for information regarding the purchase and redemption of Fund shares, including, in the case of Class A Shares, any applicable sales charges. The following information supplements information in the Funds Prospectuses.
You may purchase shares through an account maintained by your brokerage firm, financial institutions and industry professionals (Service Organizations) and you may also purchase shares directly by mail or wire. The Company reserves the right, if conditions exist which make cash payments undesirable, to honor any request for redemption or repurchase of the Funds shares by making payment in whole or in part in securities chosen by the Company and valued in the same way as they would be valued for purposes of computing the Funds NAV. If payment is made in securities, a shareholder may incur transaction costs in converting these securities into cash. A shareholder will also bear any market risk or tax consequences as a result of a payment in securities. The Company has elected, however, to be governed by Rule 18f-1 under the 1940 Act so that the Fund is obligated to redeem its shares solely in cash up to the lesser of $250,000 or 1% of its NAV during any 90-day period for any one shareholder of the Fund. A shareholder will bear the risk of a decline in market value and any tax consequences associated with a redemption in securities.
Under the 1940 Act, the Company may suspend the right to redemption or postpone the date of payment upon redemption for any period during which the New York Stock Exchange, Inc. (the NYSE) is closed (other than customary weekend and holiday closings), or during which the SEC restricts trading on the NYSE or determines an emergency exists as a result of which disposal or valuation of portfolio securities is not reasonably practicable, or for such other periods as the SEC may permit. (The Company may also suspend or postpone the recordation of the transfer of its shares upon the occurrence of any of the foregoing conditions).
Shares of the Company are subject to redemption by the Company, at the redemption price of such shares as in effect from time to time, including, without limitation: (1) to reimburse the 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 Prospectuses from time to time; (2) if such redemption is, in the opinion of the Companys Board of Directors, desirable in order to prevent the Company or the Fund from being deemed a personal holding company within the meaning of the Code; (3) or if the net income with respect to any particular class of common stock should be negative or it should otherwise be appropriate to carry out the Companys responsibilities under the 1940 Act.
The Fund has the right to redeem your shares at current NAV at any time and without prior notice if, and to the extent that, such redemption is necessary to reimburse the Fund for any loss sustained by reason of your failure to make full payment for shares of the Fund you previously purchased or subscribed for.
Class A Shares of the Fund may be subject to sales charges as described below.
Contingent Deferred Sales Charge on Certain Redemptions . Purchases of $1,000,000 or more of Class A Shares are not subject to an initial sales charge; however, a contingent deferred sales charge is payable on these investments in the event of a share redemption within 18 months following the share purchase, at the rate of 1% of the lesser of the value of the shares redeemed (exclusive of reinvested dividends and capital gain distributions) or the total cost of such shares. In determining whether a contingent deferred sales charge is payable, and the amount of the charge, it is assumed that shares purchased with reinvested dividend and capital gain distributions and then other shares held the longest are the first redeemed. The contingent deferred sales charge is waived in the event of (a) the death or disability (as defined in Section 72(m)(7) of the Code) of the shareholder, (b) a lump sum distribution from a benefit plan qualified under the Employee Retirement Income Security Act of 1974, as amended (ERISA), or (c) systematic withdrawals from ERISA plans if the shareholder is at least 59 1/2 years old. The Fund applies the waiver for death or disability to shares held at the time of death or the initial determination of disability of either an individual shareholder or one who owns the shares of a joint tenant with the right of survivorship or as a tenant in common.
Reducing or Eliminating the Front-End Sales Charge
The Funds Class A Shares are offered to the public at NAV plus a front-end sales charge. You can reduce or eliminate the front-end sales charge on Class A Shares of the Fund as follows:
Quantity Discounts . Purchases of at least $50,000 can reduce the sales charges you pay, and purchases of at least $1,000,000 can eliminate the sales charges you pay.
Combined Purchase Privilege . The following purchases may be combined for purposes of determining the amount of purchase: (a) individual purchases, if made at the same time, by a single purchaser, the purchasers spouse and children under the age of 25 purchasing Class A Shares for their own accounts, including shares purchased by a qualified retirement plan(s) exclusively for the benefit of such individual(s) (such as an IRA, individual-type section 403(b) plan or single-participant Keogh-type plan) or by a Company, as defined in Section 2(a)(8) of the 1940 Act, solely controlled, as defined in the 1940 Act, by such individual(s), or (b) individual purchases by trustees or other fiduciaries purchasing Class A Shares (i) for a single trust estate or a single fiduciary account, including an employee benefit plan, or (ii) concurrently by two or more employee benefit plans of a single employer or of employers affiliated with each other in accordance with Section 2(a)(3)(c) of the 1940 Act (excluding in either case an employee benefit plan described in (a) above), provided such trustees or other fiduciaries purchase shares in a single payment. Purchases made for nominee or street name accounts may not be combined with purchases made for such other accounts.
Cumulative Quantity Discount. You may combine the value of Class A Shares held in the Fund, along with the dollar amount of Class A Shares being purchased, to qualify for a cumulative quantity discount. The value of Class A Shares held is the higher of their cost or current net asset value. For example, if you hold Class A Shares having a value of $225,000 and purchase $25,000 of additional Class A Shares, the sales charge applicable to the additional investment would be 2.50%, the rate applicable to a single purchase of $250,000. In order to receive the cumulative quantity discount, the value of Class A Shares held must be brought to the attention of your investment broker or other Service Organization at the time of your purchase.
Letter of Intent . You can sign a Letter of Intent committing to purchase at least $50,000 in Class A Shares of the Fund within a 13-month period to combine such purchases in calculating the sales charge. A portion of your Fund shares will be held in escrow. If you complete your purchase commitments as stated in the Letter of Intent, your Fund shares held in escrow will be released to your account. If you do not fulfill the Letter of Intent, the appropriate amount of Fund shares held in escrow will be redeemed to pay the sales charges that were not applied to your purchases.
Dealer Reallowances
As shown in the table below, BNY Mellon Distributors, the Distributor for the shares of the Fund, may provide dealer reallowances up to the full sales charge for purchases of the Funds Class A Shares in which a front-end sales charge is applicable.
Amount of Purchase |
|
Sales Charge as a
|
|
Commission as a
|
|
Less than $50,000 |
|
5.25 |
% |
4.75 |
% |
At least $50,000 but less than $100,000 |
|
4.75 |
% |
4.25 |
% |
At least $100,000 but less than $250,000 |
|
3.50 |
% |
3.25 |
% |
At least $250,000 but less than $500,000 |
|
2.50 |
% |
2.25 |
% |
At least $500,000 but less than $750,000 |
|
2.00 |
% |
1.90 |
% |
At least $750,000 but less than $1,000,000 |
|
1.50 |
% |
1.45 |
% |
$1,000,000 or greater |
|
None |
|
|
** |
** No sales charge is payable at the time of purchase on investments of $1,000,000 or more; however, a 1% contingent deferred sales charge is imposed in the event of redemption within 18 months following any such purchase. The Funds distributor may pay a commission at the rate of 1% to certain brokerage firms, financial institutions and other industry professionals, including affiliates of the Adviser, who initiate and are responsible for purchases of $1,000,000 or more.
Other Purchase Information
If shares of the Fund are held in a street name account with an authorized dealer, all recordkeeping, transaction processing and payments of distributions relating to the beneficial owners account will be performed by the authorized dealer, and not by the Fund and its Transfer Agent. Since the Fund will have no record of the beneficial owners transactions, a beneficial owner should contact the authorized dealer to purchase, redeem or exchange shares, to make changes in or give instructions concerning the account or to obtain information about the account. The transfer of shares in a street name account to an account with another dealer or to an account directly with the Fund involves special procedures and will require the beneficial owner to obtain historical purchase information about the shares in the account from the authorized dealer.
TELEPHONE TRANSACTION PROCEDURES
The Companys telephone transaction procedures include the following measures: (1) requiring the appropriate telephone transaction privilege forms; (2) requiring the caller to provide the names of the account owners, the account social security number and name of the Fund, all of which must match the Companys records; (3) requiring the Companys service representative to complete a telephone transaction form, listing all of the above caller identification information; (4) permitting exchanges (if applicable) only if the two account registrations are identical; (5) requiring that redemption proceeds be sent only by check to the account owners of record at the address of record, or by wire only to the owners of record at the bank account of record; (6) sending a written confirmation for each telephone transaction to the owners of record at the address of record within five (5) business days of the call; and (7) maintaining tapes of telephone transactions for six months, if the Company elects to record shareholder telephone transactions. For accounts held of record by broker-dealers (other than BNY Mellon Distributors), financial institutions, securities dealers, financial planners and other industry professionals, additional documentation or information regarding the scope of a callers 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 a power of attorney.
VALUATION OF SHARES
Subject to the approval of the Companys Board of Directors, the Fund 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 in determining the approximate market value of portfolio investments. This may result in the securities being valued at a price that differs 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 the Funds Valuation Committee under the direction of the Companys Board of Directors.
TAXES
General
The following summarizes certain additional tax considerations generally affecting the Fund and its shareholders that are not described in the Prospectuses. No attempt is made to present a detailed explanation of the tax treatment of the Fund or its shareholders, and the discussions here and in the Prospectuses are not intended as a substitute for careful tax planning. Potential investors should consult their tax advisers with specific reference to their own tax situations.
The discussions of the federal tax consequences in the Prospectuses and this SAI are based on the Code and the regulations issued under it, and court decisions and administrative interpretations, as in effect on the date of this SAI. Future legislative or administrative changes or court decisions may significantly change the statements included herein, and such changes may be retroactive.
The Fund qualified during its last taxable year and intends to continue to qualify as a regulated investment company under Subchapter M of Subtitle A, Chapter 1, of the Code. As such, the Fund generally will be exempt from federal income tax on its net investment income and realized capital gains that it distributes to shareholders. To qualify for treatment as a regulated investment company, it must meet three important tests each year.
First, the Fund must derive with respect to each taxable year at least 90% of its gross income from dividends, interest, certain payments with respect to securities loans, gains from the sale or other disposition of stock or securities or foreign currencies, other income derived with respect to the Funds business of investing in stock, securities or currencies, or net income derived from interests in qualified publicly traded partnerships.
Second, generally, at the close of each quarter of the Funds taxable year, at least 50% of the value of the Funds 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 the issuer and as to which the Fund does not hold more than 10% of the outstanding voting securities of the issuer, and no more than 25% of the
value of the Funds total assets may be invested in the securities of (1) any one issuer (other than U.S. government securities and securities of other regulated investment companies), (2) two or more issuers that the Fund controls and which are engaged in the same or similar trades or businesses or (3) one or more qualified publicly traded partnerships.
Third, the Fund must distribute an amount equal to at least the sum of 90% of its investment company taxable income (net investment income and the excess of net short-term capital gain over net long-term capital loss) and 90% of its tax-exempt income, if any, for the year.
The Fund intends to comply with these requirements. If the Fund were to fail to make sufficient distributions, it could be liable for corporate income tax and for excise tax in respect of the shortfall or, if the shortfall is large enough, the Fund could be disqualified as a regulated investment company. If for any taxable year the Fund were not to qualify as a regulated investment company, all its taxable income would be subject to tax at regular corporate rates without any deduction for distributions to shareholders. In that event, shareholders would recognize dividend income on distributions to the extent of the Funds current and accumulated earnings and profits, and corporate shareholders could be eligible for the dividends-received deduction.
The Code imposes a nondeductible 4% excise tax on regulated investment companies that fail to distribute each year an amount equal to specified percentages of their ordinary taxable income and capital gain net income (excess of capital gains over capital losses). The Fund intends to make sufficient distributions or deemed distributions each year to avoid liability for this excise tax.
State and Local Taxes
Although the 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, the Fund may be subject to the tax laws of such states or localities.
Taxation of Certain Investments
The tax principles applicable to transactions in financial instruments, such as futures contracts and options, that may be engaged in by the Fund, and investments in passive foreign investment companies (PFICs), are complex and, in some cases, uncertain. Such transactions and investments may cause the Fund to recognize taxable income prior to the receipt of cash, thereby requiring the Fund to liquidate other positions, or to borrow money, so as to make sufficient distributions to shareholders to avoid corporate-level tax. Moreover, some or all of the taxable income recognized may be ordinary income or short-term capital gain, so that the distributions may be taxable to shareholders as ordinary income.
In addition, in the case of any shares of a PFIC in which the Fund invests, the Fund may be liable for corporate-level tax on any ultimate gain or distributions on the shares if the Fund fails to make an election to recognize income annually during the period of its ownership of the shares.
ADDITIONAL INFORMATION CONCERNING COMPANY SHARES
The Company is a Maryland corporation with authorized capital of 100 billion shares of common stock at a par value of $0.001 per share. Currently, 78.973 billion shares have been classified into [137] classes, however, the Company only has [24] active share classes that have begun investment operations. Under the Companys charter, the Board of Directors has the power to classify and reclassify any unissued shares of common stock from time to time.
Each share that represents an interest in the 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 the Company do not have preemptive or conversion rights. When issued for payment as described in the Prospectuses, shares of the Company will be fully paid and non-assessable.
The Company does not currently intend to hold annual meetings of shareholders except as required by the 1940 Act or other applicable law. The Companys amended By-Laws provide that shareholders owning at least ten percent of the outstanding shares of all classes of common stock of the Company 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, the Company will assist in shareholder communication in such matters.
Holders of shares of each class of the Company will vote in the aggregate and not by class on all matters, except where otherwise required by law. Further, shareholders of the Company 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 or class of shares. Rule 18f-2 under the 1940 Act provides that any matter required to be submitted by the provisions of such Act or applicable state law, or otherwise, to the holders of the outstanding voting securities of an investment company such as the Company shall not be deemed to have been effectively acted upon unless approved by the holders of a majority of the outstanding voting securities 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 Rule 18f-2 the approval of an investment advisory agreement or distribution agreement or any change in a fundamental investment objective or fundamental investment policy would be effectively acted upon with respect to a portfolio only if approved by the holders of a majority of the outstanding voting securities of such portfolio. However, the Rule also provides that the ratification of the selection of independent public accountants 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 a portfolio. Shareholders of the Company 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 the Company may elect all of the Directors.
Notwithstanding any provision of Maryland law requiring a greater vote of shares of the Companys common stock (or of any class voting as a class) in connection with any corporate action, unless otherwise provided by law (for example by Rule 18f-2 discussed above), or by the Companys Articles of Incorporation and By-Laws, the Company may take or authorize such action upon the favorable vote of the holders of more than 50% of all of the outstanding shares of Common Stock voting without regard to class (or portfolio).
Shareholder Approvals. As used in this SAI and in the Prospectuses, shareholder approval and a majority of the outstanding shares of the Fund or a particular class of shares of the Fund means, with respect to the approval of the Advisory Agreement, Distribution Plan or a change in the Funds investment objective or a fundamental investment limitation, the lesser of (1) 67% of the shares of the Fund or share class represented at a meeting at which the holders of more than 50% of the outstanding shares of the Fund or share class are present in person or by proxy, or (2) more than 50% of the outstanding shares of the Fund or share class.
MISCELLANEOUS
Counsel
The law firm of Drinker Biddle & Reath LLP, One Logan Square, Ste. 2000, Philadelphia, Pennsylvania 19103-6996, serves as independent counsel to the Company and the Disinterested Directors.
Independent Registered Public Accounting Firm
[ ], serves as the Funds independent registered public accounting firm.
APPENDIX A
DESCRIPTION OF SECURITIES RATINGS
Short-Term Credit Ratings
A Standard & Poors short-term issue credit rating is a current opinion of the creditworthiness of an obligor with respect to a specific financial obligation having an original maturity of no more than 365 days. The following summarizes the rating categories used by Standard & Poors for short-term issues:
A-1 Obligations are rated in the highest category and indicate that the obligors capacity to meet its financial commitment on the obligation is strong. Within this category, certain obligations are designated with a plus sign (+). This indicates that the obligors capacity to meet its financial commitment on these obligations is extremely strong.
A-2 The obligors capacity to meet its financial commitment on the obligation is satisfactory. Obligations are somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligors in the highest rating category.
A-3 Obligor has adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation.
B An obligation is regarded as vulnerable and has significant speculative characteristics. The obligor currently has the capacity to meet its financial commitment on the obligation; however, it faces major ongoing uncertainties which could lead to the obligors inadequate capacity to meet its financial commitment on the obligation. Ratings of B1, B-2 and B-3 may be assigned to indicate finer distinctions within the B category.
B-1 A short-term obligation rated B-1 is regarded as having significant speculative characteristics, but the obligor has a relatively stronger capacity to meet its financial commitments over the short-term compared to other speculative-grade obligors.
B-2 A short-term obligation rated B-2 is regarded as having significant speculative characteristics, and the obligor has an average speculative-grade capacity to meet its financial commitments over the short-term compared to other speculative-grade obligors.
B-3 A short-term obligation rated B-3 is regarded as having significant speculative characteristics, and the obligor has a relatively weaker capacity to meet its financial commitments over the short-term compared to other speculative-grade obligors.
C Obligations are currently vulnerable to nonpayment and are dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation.
R An obligor rated R is under regulatory supervision owing to its financial condition. During the pendency of the regulatory supervision the regulators may have the power to favor one class of obligations over others or pay some obligations and not others.
SD and D an obligor rated SD (selective default) or D has failed to pay one or more of its financial obligations (rated or unrated) when it came due. A D rating is assigned when Standard & Poors believes that the default will be a general default and that the obligor will fail to pay all or substantially all of its obligations as they come due. An SD rating is assigned when Standard & Poors believes that the obligor has selectively defaulted on a specific issue or class of obligations, excluding those that qualify as regulatory capital but it will continue to meet its payment obligations on other issues or classes of obligations in a timely manner.
NR An issuer designated NR is not rated.
Local Currency and Foreign Currency Risks - Country risk considerations are a standard part of Standard & Poors analysis for credit ratings on any issuer or issue. Currency of repayment is a key factor in this analysis. An obligors capacity to repay foreign currency obligations may be lower than its capacity to repay obligations in its local currency due to the sovereign governments own relatively lower capacity to repay external versus domestic debt. These sovereign risk considerations are incorporated in the debt ratings assigned to specific issues. Foreign currency issuer ratings are also distinguished from local currency issuer ratings to identify those instances where sovereign risks make them different for the same issuer.
Moodys Investors Service (Moodys) short-term ratings are opinions of the ability of issuers to honor short-term financial obligations. Ratings may be assigned to issuers, short-term programs or to individual short-term debt instruments. Such obligations generally have an original maturity not exceeding thirteen months, unless explicitly noted.
Moodys employs the following designations to indicate the relative repayment ability of rated issuers:
P-1 Issuers (or supporting institutions) rated Prime-1 have a superior ability to repay short-term debt obligations.
P-2 Issuers (or supporting institutions) rated Prime-2 have a strong ability to repay short-term debt obligations.
P-3 Issuers (or supporting institutions) rated Prime-3 have an acceptable ability to repay short-term obligations.
NP Issuers (or supporting institutions) rated Not Prime do not fall within any of the Prime rating categories.
Fitch, Inc. / Fitch Ratings Ltd. (Fitch) short-term ratings scale is based in all cases on the short-term vulnerability to default of the rated entity or security stream and relates to the capacity to meet financial obligations in accordance with the documentation governing the relevant obligation. Short-term ratings are assigned to obligations whose initial maturity is viewed as short-term based on market convention. Typically, this means up to 13 months for corporate, sovereign and structured obligations, and up to 36 months for obligations in U.S. public finance markets. The following summarizes the rating categories used by Fitch for short-term obligations:
F1 Securities possess the highest short-term credit quality. This designation indicates the strongest intrinsic capacity for timely payment of financial commitments; may have an added + to denote any exceptionally strong credit feature.
F2 Securities possess good short-term credit quality. This designation indicates good intrinsic capacity for timely payment of financial commitments.
F3 Securities possess fair short-term credit quality. This designation indicates that the intrinsic capacity for timely payment of financial commitments is adequate.
B Securities possess speculative short-term credit quality. This designation indicates minimal capacity for timely payment of financial commitments, plus heightened vulnerability to near term adverse changes in financial and economic conditions.
C Securities possess high short-term default risk. Default is a real possibility.
RD Restricted default. Indicates an entity that has defaulted on one or more of its financial commitments, although it continues to meet other financial obligations. Applicable to entity ratings only.
D Default. Indicates a broad-based default event for an entity, or the default of a specific short-term obligation.
The following summarizes the ratings used by Dominion Bond Rating Service Limited (DBRS) for commercial paper and short-term debt:
R-1 (high) - Short-term debt rated R-1 (high) is of the highest credit quality, and indicates an entity possessing exceptionally high ability to repay current liabilities as they fall due. Entities rated in this category are unlikely to be affected by future events.
R-1 (middle) Short-term debt rated R-1 (middle) is of superior credit quality, and indicates an entity possessing very high ability to repay current liabilities as they fall due and, in most cases, ratings in this category differ from R-1 (high) credits by relatively modest degree. Entities rated in this category are unlikely to be significantly vulnerable to future events.
R-1 (low) Short-term debt rated R-1 (low) is of good credit quality. The capacity for the payment of short-term financial obligations as they fall due is substantial. Overall strength is not as favorable as higher rating categories. May be vulnerable to future events, but qualifying negative factors are considered manageable.
R-2 (high) Short-term debt rated R-2 (high) is considered to be at the upper end of adequate credit quality. The capacity for the payment of short-term financial obligations as they fall due is acceptable. May be vulnerable to future events.
R-2 (middle) Short-term debt rated R-2 (middle) is considered to be of adequate credit quality. The capacity for the payment of short-term financial obligations as they fall due is acceptable. May be vulnerable to future events or may be exposed to other factors that could reduce credit quality.
R-2 (low) Short-term debt rated R-2 (low) is considered to be at the lower end of adequate credit quality. The capacity for the payment of short-term financial obligations as they fall due is acceptable. May be vulnerable to future events. A number of challenges are present that could affect the issuers ability to meet such obligations.
R-3 Short-term debt rated R-3 is considered to be at the lowest end of adequate credit quality. There is a capacity for the payment of short-term financial obligations as they fall due. May be vulnerable to future events and the certainty of meeting such obligations could be impacted by a variety of developments.
R-4 Short-term debt rated R-4 is speculative credit quality. The capacity for the payment of short-term financial obligations as they fall due is uncertain.
R-5 Short-term debt rated R-5 is highly speculative credit quality. There is a high level of uncertainty as to the capacity of the entity to meet short-term financial obligations as they fall due.
D A security rated D implies a financial obligation has not been met or it is clear that a financial obligation will not be met in the near future, or a debt instrument has been subject to a distressed exchange. A downgrade to D may not immediately follow an insolvency or restructuring filing as grace periods, other procedural considerations, or extenuating circumstance may exist.
Long-Term Credit Ratings
The following summarizes the ratings used by Standard & Poors for long-term issues:
AAA An obligor rated AAA has extremely strong capacity to meet its financial commitments. AAA is the highest issuer credit rating assigned by Standard & Poors.
AA An obligor rated AA has very strong capacity to meet its financial commitments. It differs from the highest-rated obligors only to a small degree.
A An obligor rated A has strong capacity to meet its financial commitments but is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligors in higher-rated categories.
BBB An obligor rated BBB has adequate capacity to meet its financial commitments. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitments.
BB, B, CCC and CC Obligors rated BB, B, CCC and CC are regarded as having significant speculative characteristics. BB indicates the least degree of speculation and CC the highest. While such obligors will likely have some quality and protective characteristics, these may be outweighed by large uncertainties or major exposures to adverse conditions.
BB An obligor rated BB is less vulnerable in the near term than other lower-rated obligors. However, it faces major ongoing uncertainties and exposure to adverse business, financial, or economic conditions which could lead to the obligors inadequate capacity to meet its financial commitments.
B An obligor rated B is more vulnerable than the obligors rated BB, but the obligor currently has the capacity to meet its financial commitments. Adverse business, financial, or economic conditions will likely impair the obligors capacity or willingness to meet its financial commitments.
CCC An obligor rated CCC is currently vulnerable, and is dependent upon favorable business, financial and economic conditions to meet its financial commitments.
CC An obligor rated CC is currently highly vulnerable.
Plus (+) or minus (-) The ratings from AA to CCC may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the major rating categories.
R An obligor rated R is under regulatory supervision owing to its financial condition. During the pendency of the regulatory supervision the regulators may have the power to favor one class of obligations over others or pay some obligations and not others.
SD and D An obligor rated SD (selective default) or D has failed to pay one or more of its financial obligations (rated or unrated) when it came due. A D rating is assigned when Standard & Poors believes that the default will be a general default and that the obligor will fail to pay all or substantially all of its obligations as they come due. An SD rating is assigned when Standard & Poors believes that the obligor has selectively defaulted on a specific issue or class of obligations, excluding those that qualify as regulatory capital, but it will continue to meet its payment obligations on other issues or classes of obligations in a timely manner. A selective default includes the completion of a distressed exchange offer, whereby one or more financial obligation is either repurchased for an amount of cash or replaced by other instruments having a total value that is less than par.
NR An issuer designated NR is not rated.
Local Currency and Foreign Currency Risks - Country risk considerations are a standard part of Standard & Poors analysis for credit ratings on any issuer or issue. Currency of repayment is a key factor in this analysis. An obligors capacity to repay foreign currency obligations may be lower than its capacity to repay obligations in its local currency due to the sovereign governments own relatively lower capacity to repay external versus domestic debt. These sovereign risk considerations are incorporated in the debt ratings assigned to specific issues. Foreign currency issuer ratings are also distinguished from local currency issuer ratings to identify those instances where sovereign risks make them different for the same issuer.
The following summarizes the ratings used by Moodys for long-term debt:
Aaa Obligations rated Aaa are judged to be of the highest quality, with minimal credit risk.
Aa Obligations rated Aa are judged to be of high quality and are subject to very low credit risk.
A Obligations rated A are considered upper-medium grade and are subject to low credit risk.
Baa Obligations rated Baa are subject to moderate credit risk. They are considered medium-grade and as such may possess certain speculative characteristics.
Ba Obligations rated Ba are judged to have speculative elements and are subject to substantial credit risk.
B Obligations rated B are considered speculative and are subject to high credit risk.
Caa Obligations rated Caa are judged to be of poor standing and are subject to very high credit risk.
Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest.
C Obligations rated C are the lowest rated class and are typically in default, with little prospect for recovery of principal or interest.
Note: Moodys appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category.
The following summarizes long-term ratings used by Fitch:
AAA Securities considered to be of the highest credit quality. AAA ratings denote the lowest expectation of default risk. They are assigned only in cases of exceptionally strong capacity for
payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events.
AA Securities considered to be of very high credit quality. AA ratings denote expectations of very low default risk. They indicate very strong capacity for payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.
A Securities considered to be of high credit quality. A ratings denote expectations of low default risk. The capacity for payment of financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to adverse business or economic conditions than is the case for higher ratings.
BBB Securities considered to be of good credit quality. BBB ratings indicate that expectations of default risk are currently low. The capacity for payment of financial commitments is considered adequate but adverse business or economic conditions are more likely to impair this capacity.
BB Securities considered to be speculative. BB ratings indicate that there is an elevated vulnerability to default risk, particularly in the event of adverse changes in business or economic conditions over time; however, business or financial flexibility exists which supports the servicing of financial commitments.
B Securities considered to be highly speculative. B ratings indicate that material default risk is present, but a limited margin of safety remains. Financial commitments are currently being met; however, capacity for continued payment is vulnerable to deterioration in the business and economic environment.
CCC, CC and C A CCC rating indicates substantial credit risk, with default a real possibility. A CC rating indicates very high levels of credit risk. Default of some kind appears probable. C ratings signal exceptionally high levels of credit risk. Default is imminent or inevitable, or the issuer is in standstill.
RD indicates an issuer that in Fitch Ratings opinion has experienced an uncured payment default on a bond, loan or other material financial obligation but which has not entered into bankruptcy filings, administration, receivership, liquidation or other formal winding-up procedure, and which has not otherwise ceased business.
D indicates an issuer that in Fitch Ratings opinion has entered into bankruptcy filings, administration, receivership, liquidation or other formal winding-up procedure, or which has otherwise ceased business.
Default ratings are not assigned prospectively to entities or their obligations; within this context, non-payment on an instrument that contains a deferral feature or grace period will generally not be considered a default until after the expiration of the deferral or grace period, unless a default is otherwise driven by bankruptcy or other similar circumstance, or by a coercive debt exchange.
Imminent default typically refers to the occasion where a payment default has been intimated by the issuer, and is all but inevitable. This may, for example, be where an issuer has missed a scheduled payment, but (as is typical) has a grace period during which it may cure the payment default. Another alternative would be where an issuer has formally announced a coercive debt exchange, but the date of the exchange still lies several days or weeks in the immediate future.
In all cases, the assignment of a default rating reflects the agencys opinion as to the most appropriate rating category consistent with the rest of its universe of ratings, and may differ from the definition of default under the terms of an issuers financial obligations or local commercial practice.
Plus (+) or minus (-) may be appended to a rating to denote relative status within major rating categories. Such suffixes are not added to the AAA long-term rating category or to categories below B.
The following summarizes the ratings used by DBRS for long-term debt:
AAA - Long-term debt rated AAA is of the highest credit quality. The capacity for the payment of financial obligations is exceptionally high and unlikely to be adversely affected by future events.
AA Long-term debt rated AA is of superior credit quality. The capacity for the payment of financial obligations is considered high. Credit quality differs from AAA only to a small degree. Unlikely to be significantly vulnerable to future events.
A Long-term debt rated A is of good credit quality. The capacity for the payment of financial obligations is substantial, but of lesser credit quality than AA. May be vulnerable to future events, but qualifying negative factors are considered manageable.
BBB Long-term debt rated BBB is of adequate credit quality. The capacity for the payment of financial obligations is considered acceptable. May be vulnerable to future events.
BB Long-term debt rated BB is defined to be speculative, non-investment grade credit quality. The capacity for the payment of financial obligations is uncertain. Vulnerable to future events.
B Long-term debt rated B is highly speculative credit quality. There is a high level of uncertainty as to the capacity to meet financial obligations.
CCC, CC and C Long-term debt rated in any of these categories is very highly speculative credit quality and is in danger of defaulting on financial obligations. There is little difference between these three categories, although CC and C ratings are normally applied to obligations that are seen as highly likely to default, or subordinated to obligations rated in the CCC to B range. Obligations in respect of which default has not technically taken place but is considered inevitable may be rated in the C category.
D A security rated D implies a financial obligation has not been met or it is clear that a financial obligation will not be met in the near future or a debt instrument has been subject to a distressed exchange. A downgrade to D may not immediately follow an insolvency or restructuring filing as grace periods or extenuating circumstances may exist.
(high, low) Each rating category is denoted by the subcategories high and low. The absence of either a high or low designation indicates the rating is in the middle of the category. The AAA and D categories do not utilize high, middle, and low as differential grades.
Municipal Note Ratings
A Standard & Poors U.S. municipal note rating reflects Standard & Poors opinion about the liquidity factors and market access risks unique to the notes. Notes due in three years or less will likely receive a note rating. Notes with an original maturity of more than three years will most likely receive a long-term debt rating. In determining which type of rating, if any, to assign, Standard & Poors analysis will review the following considerations:
· Amortization schedule-the larger the final maturity relative to other maturities, the more likely it will be treated as a note; and
· Source of payment-the more dependent the issue is on the market for its refinancing, the more likely it will be treated as a note.
Note rating symbols are as follows:
SP-1 The issuers of these municipal notes exhibit a strong capacity to pay principal and interest. An issue determined to possess a very strong capacity to pay debt service is given a plus (+) designation.
SP-2 The issuers of these municipal notes exhibit a satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and economic changes over the term of the notes.
SP-3 The issuers of these municipal notes exhibit speculative capacity to pay principal and interest.
Moodys uses three rating categories for short-term municipal obligations that are considered investment grade. These ratings are designated as Municipal Investment Grade (MIG) and are divided into three levels MIG-1 through MIG-3. In addition, those short-term obligations that are of speculative quality are designated SG, or speculative grade. MIG ratings expire at the maturity of the obligation. The following summarizes the ratings used by Moodys for these short-term obligations:
MIG-1 This designation denotes superior credit quality. Excellent protection is afforded by established cash flows, highly reliable liquidity support, or demonstrated broad-based access to the market for refinancing.
MIG-2 This designation denotes strong credit quality. Margins of protection are ample, although not as large as in the preceding group.
MIG-3 This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be narrow, and market access for refinancing is likely to be less well-established.
SG This designation denotes speculative-grade credit quality. Debt instruments in this category may lack sufficient margins of protection.
In the case of variable rate demand obligations (VRDOs), a two-component rating is assigned; a long or short-term debt rating and a demand obligation rating. The first element represents Moodys evaluation of the degree of risk associated with scheduled principal and interest payments. The second element represents Moodys evaluation of the degree of risk associated with the ability to receive purchase price upon demand (demand feature), using a variation of the MIG rating scale, the Variable Municipal Investment Grade or VMIG rating.
When either the long- or short-term aspect of a VRDO is not rated, that piece is designated NR, e.g., Aaa/NR or NR/VMIG-1.
VMIG rating expirations are a function of each issues specific structural or credit features.
VMIG-1 This designation denotes superior credit quality. Excellent protection is afforded by the superior short-term credit strength of the liquidity provider and structural and legal protections that ensure the timely payment of purchase price upon demand.
VMIG-2 This designation denotes strong credit quality. Good protection is afforded by the strong short-term credit strength of the liquidity provider and structural and legal protections that ensure the timely payment of purchase price upon demand.
VMIG-3 This designation denotes acceptable credit quality. Adequate protection is afforded by the satisfactory short-term credit strength of the liquidity provider and structural and legal protections that ensure the timely payment of purchase price upon demand.
SG This designation denotes speculative-grade credit quality. Demand features rated in this category may be supported by a liquidity provider that does not have an investment grade short-term rating or may lack the structural and/or legal protections necessary to ensure the timely payment of purchase price upon demand.
Fitch uses the same ratings for municipal securities as described above for other short-term credit ratings.
About Credit Ratings
A Standard & Poors issue credit rating is a forward-looking opinion about the creditworthiness of an obligor with respect to a specific financial obligation, a specific class of financial obligations, or a specific
financial program (including ratings on medium-term note programs and commercial paper programs). It takes into consideration the creditworthiness of guarantors, insurers, or other forms of credit enhancement on the obligation and takes into account the currency in which the obligation is denominated. The opinion reflects Standard & Poors view of the obligors capacity and willingness to meet its financial commitments as they come due, and may assess terms, such as collateral security and subordination, which could affect ultimate payment in the event of default.
Moodys credit ratings must be construed solely as statements of opinion and not statements of fact or recommendations to purchase, sell or hold any securities.
Fitchs credit ratings provide an opinion on the relative ability of an entity to meet financial commitments, such as interest, preferred dividends, repayment of principal, insurance claims or counterparty obligations. Fitch credit ratings are used by investors as indications of the likelihood of receiving the money owed to them in accordance with the terms on which they invested. Fitchs credit ratings cover the global spectrum of corporate, sovereign (including supranational and sub-national), financial, bank, insurance, municipal and other public finance entities and the securities or other obligations they issue, as well as structured finance securities backed by receivables or other financial assets.
DBRS credit ratings are opinions based on the quantitative and qualitative analysis of information sourced and received by DBRS, which information is not audited or verified by DBRS. Ratings are not buy, hold or sell recommendations and they do not address the market price of a security. Ratings may be upgraded, downgraded, placed under review, confirmed and discontinued.
THE RBB FUND, INC.
PEA 144
PART C: OTHER INFORMATION
Item 28 . EXHIBITS
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Articles of Incorporation. |
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Articles of Incorporation of Registrant are incorporated herein by reference to Registrants Registration Statement (No. 33-20827) filed on March 24, 1988, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Registrants Registration Statement (No. 33-20827) filed on March 24, 1988, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles of Amendment to Articles of Incorporation of Registrant are incorporated herein by reference to Pre-Effective Amendment No. 2 to Registrants Registration Statement (No. 33-20827) filed on July 12, 1988, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Pre-Effective Amendment No. 2 to Registrants Registration Statement (No. 33-20827) filed on July 12, 1988, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 3 to the Registrants Registration Statement (No. 33-20827) filed on April 27, 1990, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 4 to the Registrants Registration Statement (No. 33-20827) filed on May 1, 1990, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 7 to the Registrants Registration Statement (No. 33-20827) filed on July 15, 1992, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 8 to the Registrants Registration Statement (No. 33-20827) filed on October 22, 1992, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 13 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1993, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 13 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1993, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 22 to the Registrants Registration Statement (No. 33-20827) filed on December 19, 1994, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 22 to the Registrants Registration Statement (No. 33-20827) filed on December 19, 1994, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 22 to the Registrants Registration Statement (No. 33-20827) filed on December 19, 1994, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 22 to the Registrants Registration Statement (No. 33-20827) filed on December 19, 1994, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 27 to the Registrants Registration Statement (No. 33-20827) filed on March 31, 1995. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 34 to the Registrants Registration Statement (No. 33-20827) filed on May 16, 1996. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 39 to the Registrants Registration Statement (No. 33-20827) filed on October 11, 1996. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 45 to the Registrants Registration Statement (No. 33-20827) filed on May 9, 1997. |
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Articles of Amendment to Charter of the Registrant are incorporated herein by reference to Post-Effective Amendment No. 46 to the Registrants Registration Statement (No. 33-20827) filed on September 25, 1997. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 46 to the Registrants Registration Statement (No. 33-20827) filed on September 25, 1997. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 60 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 60 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 63 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 63 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 1998. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 67 to the Registrants Registration Statement (No. 33-20827) filed on September 30, 1999. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 69 to the Registrants Registration Statement (No. 33-20827) filed on November 29, 1999. |
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Articles of Amendment to Charter of the Registrant are incorporated herein by reference to Post-Effective Amendment No. 71 to the Registrants Registration Statement (No. 33-20827) filed on December 29, 2000. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 71 to the Registrants Registration Statement (No. 33-20827) filed on December 29, 2000. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 71 to the Registrants Registration Statement (No. 33-20827) filed on December 29, 2000. |
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Articles of Amendment to Charter of the Registrant are incorporated herein by reference to Post-Effective Amendment No. 71 to the Registrants Registration Statement (No. 33-20827) filed on December 29, 2000. |
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Articles Supplementary of Registrant are incorporated herein by reference to Post-Effective Amendment No. 73 to the Registrants Registration Statement (No. 33-20827) filed on March 15, 2001. |
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Articles of Amendment of Registrant ( Boston Partners Bond Fund - Institutional Class and Boston Partners Bond Fund - Investor Class ) are incorporated herein by reference to Post-Effective Amendment No. 77 to the Registrants Registration Statement (No. 33-20827) filed on May 15, 2002. |
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Articles Supplementary to Charter of the Registrant ( Boston Partners All-Cap Value Fund - Institutional Class and Boston Partners Bond Fund - Institutional Class ) are incorporated herein by reference to Post-Effective Amendment No. 77 to the Registrants Registration Statement (No. 33-20827) filed on May 15, 2002. |
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Articles Supplementary of Registrant ( Schneider Value Fund ) are incorporated herein by reference to Post-Effective Amendment No. 78 to the Registrants Registration Statement (No. 33-20827) filed on May 16, 2002. |
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Articles Supplementary of Registrant ( Institutional Liquidity Fund for Credit Unions and Liquidity Fund for Credit Union Members ) are incorporated herein by reference to Post-Effective Amendment No. 84 to the Registrants Registration Statement (No. 33-20827) filed on December 29, 2003. |
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(36) |
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Articles of Amendment to Charter of the Registrant are incorporated herein by reference to Post-Effective Amendment No. 89 to the Registrants Registration Statement (No. 33-20827) filed on December 30, 2004. |
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(37) |
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Articles Supplementary of Registrant ( Robeco WPG Core Bond Fund Investor Class, Robeco WPG Core Bond Fund Institutional Class, Robeco WPG Tudor Fund Institutional Class, Robeco WPG Large Cap Growth Fund Institutional Class ) are incorporated herein by reference to Post-Effective Amendment No. 93 to the Registrants Registration Statement (No. 33-20827) filed on March 4, 2005. |
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(38) |
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Certificate of Correction of Registrant is incorporated herein by reference to Post-Effective Amendment No. 95 to the Registrants Registration Statement (No. 33-20827) filed on March 23, 2005. |
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(39) |
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Articles Supplementary of Registrant ( Robeco WPG Core Bond Fund Investor Class, Robeco WPG Core Bond Fund Institutional Class, Robeco WPG Tudor Fund Institutional Class, Robeco WPG 130/30 Large Cap Core Fund f/k/a Robeco WPG Large Cap Growth Fund Institutional Class ) are incorporated herein by reference to Post-Effective Amendment No. 95 to the Registrants Registration Statement (No. 33-20827) filed on March 23, 2005. |
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(40) |
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Articles Supplementary of Registrant ( Senbanc Fund) are incorporated herein by reference to Post-Effective Amendment No. 96 to the Registrants Registration Statement (No. 33-20827) filed on June 6, 2005. |
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(41) |
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Articles of Amendment of Registrant ( Robeco WPG Core Bond Fund Retirement Class) are incorporated herein by reference to Post-Effective Amendment No. 97 to the Registrants Registration Statement (No. 33-20827) filed on August 19, 2005. |
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(42) |
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Articles Supplementary of Registrant ( Robeco WPG Core Bond Fund Investor Class) are incorporated herein by reference to Post-Effective Amendment No. 99 to the Registrants Registration Statement (No. 33-20827) filed on September 27, 2005. |
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(43) |
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Articles Supplementary of Registrant (Bear Stearns CUFS MLP Mortgage Portfolio) are incorporated herein by reference to Post-Effective Amendment No. 104 to the Registrants Registration Statement (No. 33-20827) filed on July 18, 2006. |
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(44) |
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Articles of Amendment of Registrant (Bear Stearns CUFS MLP Mortgage Portfolio) are incorporated herein by reference to Post-Effective Amendment No. 108 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 2006. |
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(45) |
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Articles Supplementary of Registrant (Bear Stearns Ultra Short Income Fund f/k/a Bear Stearns Enhanced Income Fund) are incorporated herein by reference to Post-Effective Amendment No. 109 to Registrants Registration Statement (No. 33-20827) filed on December 15, 2006. |
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(46) |
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Articles Supplementary of Registrant (Marvin & Palmer Large Cap Growth Fund) are incorporated herein by reference to Post-Effective Amendment No. 109 to Registrants Registration Statement (No. 33-20827) filed on December 15, 2006. |
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(47) |
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Articles of Amendment of Registrant (Bear Stearns Ultra Short Income Fund f/k/a Bear Stearns Enhanced Income Fund) are incorporated herein by reference to Post-Effective Amendment No. 111 to the Registrants Registration Statement (No. 33-20827) filed on February 28, 2007. |
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(48) |
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Articles Supplementary of Registrant (Bear Stearns Ultra Short Income Fund f/k/a Bear Stearns Enhanced Income Fund) are incorporated herein by reference to Post-Effective Amendment No. 111 to the Registrants Registration Statement (No. 33-20827) filed on February 28, 2007. |
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(49) |
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Articles Supplementary of Registrant (Free Market U.S. Equity Fund, Free Market International Equity Fund, Free Market Fixed-Income Fund) incorporated herein by reference to Post-Effective Amendment No. 112 to the Registrants Registration Statement (No. 33-20827) filed on June 1, 2007. |
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(50) |
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Articles Supplementary of Registrant (Robeco WPG 130/30 Large Cap Core Fund Investor Class) are incorporated herein by reference to Post-Effective Amendment No.113 to the Registrants Registration Statement (No. 33-20827) filed on July 13, 2007. |
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(51) |
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Articles Supplementary of Registrant ( SAM Sustainable Water Fund, SAM Sustainable Climate Fund ) are incorporated herein by reference to Post-Effective Amendment No.114 to the Registrants Registration Statement (No. 33-20827) filed on July 17, 2007. |
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(52) |
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Articles of Amendment of Registrant (Robeco WPG 130/30 Large Cap Core Fund Institutional Class) are incorporated herein by reference to Post-Effective Amendment No.116 to the Registrants Registration Statement (No. 33-20827) filed on September 4, 2007. |
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(53) |
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Articles Supplementary of Registrant ( Bear Stearns Multifactor 130/30 US Core Equity Fund ) are incorporated herein by reference to Post-Effective Amendment No. 123 to the Registrants Registration Statement (No. 33-20827) filed on December 17, 2007. |
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(54) |
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Articles of Amendment of Registrant (Bear Stearns Ultra Short Income Fund f/k/a Bear Stearns Enhanced Income Fund are incorporated herein by reference to Post-Effective Amendment No. 124 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2007. |
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(55) |
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Articles Supplementary of Registrant ( SAM Sustainable Global Active Fund, SAM Sustainable Themes Fund ) are incorporated herein by reference to Post-Effective Amendment No. 128 to the Registrants Registration Statement (No. 33-20827) filed on April 23, 2009. |
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(56) |
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Articles Supplementary of Registrant ( Perimeter Small Cap Growth Fund) are incorporated herein by reference to Post-Effective Amendment No. 129 to the Registrants Registration Statement (No. 33-20827) filed on July 2, 2009. |
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(57) |
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Articles Supplementary of Registrant ( S1 Fund) are incorporated herein by reference to Post-Effective Amendment No. 135 to Registrants Registration Statement (No. 33-20827) filed on July 19, 2010. |
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(58) |
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Articles Supplementary of Registrant ( Robeco Boston Partners Long/Short Research Fund ) are incorporated herein by reference to Post-Effective Amendment No. 136 to the Registrants Registration Statement (No. 33-20827) filed on August 4, 2010. |
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(59) |
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Articles of Amendment of Registrant (Robeco WPG Small/Micro Cap Value Fund f/k/a Robeco WPG Small Cap Value Fund) are incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(60) |
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Articles Supplementary of Registrant ( Robeco Boston Partners Global Equity Fund and Robeco Boston Partners International Equity Fund ) are incorporated herein by reference to Post-Effective Amendment No. 142 to the Registrants Registration Statement (No. 33-20827) filed on October 14, 2011. |
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(61) |
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Articles Supplementary of Registrant ( Summit Global Investments U.S. Low Volatility Equity Fund ) are filed herewith. |
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(b) |
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By-Laws. |
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(1) |
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By-Laws, as amended, are incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(c) |
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Instruments Defining Rights of Security Holders. |
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(1) |
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See Articles VI, VII, VIII, IX and XI of Registrants Articles of 1 Incorporation dated February 17, 1988 which are incorporated herein by reference to Registrants Registration Statement (No. 33-20827) filed on March 24, 1988, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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(2) |
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See Articles II, III, VI, XIII, and XIV of Registrants By-Laws as amended through August 25, 2004, which are incorporated herein by reference to Post-Effective Amendment No. 89 to the Registrants Registration Statement (No. 33-20827) filed on December 30, 2004. |
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(d) |
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Investment Advisory Contracts. |
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(1) |
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Investment Advisory Agreement (Schneider Small Cap Value Fund) between Registrant and Schneider Capital Management Company is incorporated herein by reference to Post-Effective Amendment No. 60 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1998. |
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(2) |
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Investment Advisory Agreement (Boston Partners Small Cap Value Fund II (formerly Micro Cap Value)) between Registrant and Boston Partners Asset Management, L.P. is incorporated herein by reference to Post-Effective Amendment No. 83 to the Registrants Registration Statement (No. 33-20827) filed on April 8, 2003. |
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(3) |
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Amendment to Investment Advisory Agreement (Boston Partners Small Cap Value Fund II) is incorporated herein by reference to Post-Effective Amendment No. 126 to the Registrants Registration Statement (No. 33-20827) filed on October 24, 2008. |
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(4) |
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Investment Advisory Agreement (Boston Partners Long/Short Equity Fund (formerly Market Neutral)) between Registrant and Boston Partners Asset Management, L.P. is incorporated herein by reference to Post-Effective Amendment No. 83 to the Registrants Registration Statement (No. 33-20827) filed on April 8, 2003. |
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(5) |
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Investment Advisory Agreement (Bogle Investment Management Small Cap Growth Fund) between Registrant and Bogle Investment Management, L.P. is incorporated herein by reference to Post-Effective Amendment No. 67 to the Registrants Registration Statement (No. 33-20827) filed on September 30, 1999. |
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(6) |
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Amended and Restated Investment Advisory Agreement (Boston Partners All-Cap Value Fund) between Registrant and Boston Partners Asset Management, L.P. is incorporated herein by reference to Post-Effective Amendment No. 105 to the Registrants Registration Statement (No. 33-20827) filed on October 30, 2006. |
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(7) |
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Investment Advisory Agreement (Schneider Value Fund) between Registrant and Schneider Capital Management Company is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(8) |
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Investment Advisory Agreement (Robeco WPG Small/Micro Cap Value Fund f/k/a Robeco WPG Tudor Fund) between Registrant and Weiss, Peck & Greer Investments is incorporated herein by reference to Post-Effective Amendment No. 100 to the Registrants Registration Statement (No. 33-20827) filed on November 25, 2005. |
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(9) |
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Investment Advisory Agreement (Bear Stearns CUFS MLP Mortgage Portfolio ) between Registrant and Bear Stearns Asset Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 126 to the Registrants Registration Statement (No. 33-20827) filed on October 24, 2008. |
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(10) |
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Investment Advisory and Administration Agreement (Money Market Portfolio ) between Registrant and BlackRock Advisors, LLC. is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(11) |
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Investment Advisory Agreement (Marvin & Palmer Large Cap Growth Fund ) is incorporated herein by reference to Post-Effective Amendment No. 124 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2007. |
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(12) |
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Investment Advisory Agreement (Free Market U.S. Equity Fund, Free Market International Equity Fund, Free Market Fixed Income Fund) is incorporated herein by reference to Post-Effective Amendment No. 125 to the Registrants Registration Statement (No. 33-20827) filed on February 27, 2008. |
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(13) |
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Contractual Fee Waiver Agreement (Schneider Small Cap Value Fund) is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(14) |
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Contractual Fee Waiver Agreement (Schneider Value Fund) is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(15) |
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Contractual Fee Waiver Agreement (Bogle Investment Management Small Cap Growth Fund) is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(16) |
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Form of Contractual Fee Waiver Agreement (Robeco Boston Partners Large Cap Value Fund, Robeco Boston Partners Small Cap Value Fund II, Robeco Boston Partners Mid Cap Value Fund, Robeco Boston Partners Long/Short Equity Fund, Robeco WPG Core Bond Fund, Robeco WPG Small Cap Value Fund and Robeco WPG 130/30 Large Cap Core Fund) is incorporated herein by reference to Post-Effective Amendment No. 134 to the Registrants Registration Statement (No. 33-20827) filed on December 30, 2009. |
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(17) |
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Contractual Fee Waiver Agreement (Marvin & Palmer Large Cap Growth Fund) is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(18) |
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Assumption Agreement (Robeco Boston Partners Small Cap Value Fund II, Robeco Boston Partners Long/Short Equity Fund, Robeco Boston Partners Large Cap Value Fund, Robeco Boston Partners Mid Cap Value Fund, Robeco Boston Partners All-Cap Value Fund) between Boston Partners Asset Management and Robeco Investment Management, Inc. dated January 1, 2007 is incorporated herein by reference to Post-Effective Amendment No. 111 to the Registrants Registration Statement (No. 33-20827) filed on February 28, 2007. |
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(19) |
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Assumption Agreement (Robeco WPG Core Bond Fund, Robeco WPG Large Cap Growth Fund, and Robeco WPG Small/Micro Cap Value Fund f/k/a Robeco WPG Small Cap Value Fund) between Weiss, Peck, & Greer Investments and Robeco Investment Management, Inc. dated January 1, 2007 is incorporated herein by reference to Post-Effective Amendment No. 111 to the Registrants Registration Statement (No. 33-20827) filed on February 28, 2007. |
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(20) |
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Investment Advisory Agreement (Perimeter Small Cap Growth Fund) between Registrant and Perimeter Capital Management LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(21) |
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Contractual Fee Waiver Agreement (Perimeter Small Cap Growth Fund) between Registrant and Perimeter Capital Management is incorporated herein by reference to Post-Effective Amendment No. 132 to the Registration Statement (No. 33-20827) filed on October 22, 2009. |
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(22) |
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Investment Advisory Agreement (S1 Fund) between Registrant and Simple Alternatives, LLC is incorporated herein by reference to Post-Effective Amendment No. 138 to the Registration Statement (No. 33-20827) filed on October 29, 2010. |
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(23) |
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Contractual Fee Waiver Agreement (S1 Fund) between Registrant and Simple Alternatives, LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(24) |
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Investment Sub-Advisory Agreement (S1 Fund) between Simple Alternatives, LLC and Roaring Blue Lion Capital Management, LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(25) |
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Investment Sub-Advisory Agreement (S1 Fund) between Simple Alternatives, LLC and Courage Capital Management, LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(26) |
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Investment Sub-Advisory Agreement (S1 Fund) between Simple Alternatives, LLC and Cramer Rosenthal McGlynn LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(27) |
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Investment Sub-Advisory Agreement (S1 Fund) between Simple Alternatives, LLC and Lauren Templeton Capital Management, LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(28) |
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Investment Sub-Advisory Agreement (S1 Fund) between Simple Alternatives, LLC and Starwood Real Estate Securities, LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(29) |
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Investment Sub-Advisory Agreement (S1 Fund) between Simple Alternatives, LLC and Trellus Management Co., LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(30) |
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Investment Advisory Agreement ( Robeco Boston Partners Long/Short Research Fund) between Registrant and Robeco Investment Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(31) |
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Contractual Fee Waiver Agreement (Robeco Boston Partners Long/Short Research Fund) between Registrant and Robeco Investment Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(32) |
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Contractual Fee Waiver Agreement (Robeco Boston Partners All-Cap Value Fund) between Registrant and Robeco Investment Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(33) |
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Form of Investment Advisory Agreement ( Robeco Boston Partners Global Equity Fund) between Registrant and Robeco Investment Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 142 to the Registrants Registration Statement (No. 33-20827) filed on October 14, 2011. |
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(34) |
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Form of Investment Advisory Agreement ( Robeco Boston Partners International Equity Fund) between Registrant and Robeco Investment Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 142 to the Registrants Registration Statement (No. 33-20827) filed on October 14, 2011. |
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(35) |
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Form of Contractual Fee Waiver Agreement (Robeco Boston Partners Global Equity Fund and Robeco Boston Partners International Equity Fund) between Registrant and Robeco Investment Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 142 to the Registrants Registration Statement (No. 33-20827) filed on October 14, 2011. |
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(36) |
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Form of Investment Advisory Agreement ( Summit Global Investments U.S. Low Volatility Equity Fund ) between Registrant and Summit Global Investments, LLC is filed herewith. |
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(37) |
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Form of Contractual Fee Waiver Agreement ( Summit Global Investments U.S. Low Volatility Equity Fund ) between Registrant and Summit Global Investments, LLC is filed herewith. |
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(e) |
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Underwriting Contracts. |
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(1) |
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Distribution Agreement between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) dated as of January 2, 2001 is incorporated herein by reference to Post-Effective Amendment No. 73 to the Registrants Registration Statement (No. 33-20827) filed on March 15, 2001. |
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(2) |
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Distribution Agreement Supplement (Boston Partners All-Cap Value Fund - Investor Class) between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(3) |
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Distribution Agreement Supplement (Boston Partners All-Cap Value Fund - Institutional Class ) between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(4) |
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Distribution Agreement Supplement (Schneider Value Fund) between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(5) |
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Distribution Agreement Supplement (Robeco WPG Small/Micro Cap Value Fund f/k/a Robeco WPG Small Cap Value Fund - Institutional Class) between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) is incorporated herein by reference to Post-Effective Amendment No. 101 to the Registrants Registration Statement (No. 33-20827) filed on December 29, 2005. |
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(6) |
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Distribution Agreement Supplement (Bear Stearns CUFS MLP Mortgage Portfolio) between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) is incorporated herein by reference to Post-Effective Amendment No. 108 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 2006. |
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(7) |
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Distribution Agreement Supplement (Marvin & Palmer Large Cap Growth Fund) between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) is incorporated herein by reference to Post-Effective Amendment No. 124 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2007. |
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(8) |
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Distribution Agreement Supplements (Free Market U.S. Equity Fund) between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) is incorporated herein by reference to Post-Effective Amendment No. 126 to the Registrants Registration Statement (No. 33-20827) filed on October 24, 2008. |
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(9) |
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Distribution Agreement Supplement ( Free Market International Equity Fund ) between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) is incorporated herein by reference to Post-Effective Amendment No. 126 to the Registrants Registration Statement (No. 33-20827) filed on October 24, 2008. |
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(10) |
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Distribution Agreement Supplement ( Free Market Fixed Income Fund ) between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) is incorporated herein by reference to Post-Effective Amendment No. 126 to the Registrants Registration Statement (No. 33-20827) filed on October 24, 2008. |
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(11) |
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Form of Distribution Agreement Supplement (Perimeter Small Cap Growth Fund) between Registrant and BNY Mellon Distributors, Inc. ( f/k/a PFPC Distributors, Inc.) is incorporated herein by reference to Post Effective Amendment No. 132 to the Registration Statement (No. 33-20827) filed on October 22, 2009. |
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(12) |
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Distribution Agreement between Registrant and BNY Mellon Distributors, Inc. is incorporated herein by reference to Post-Effective Amendment No. 136 to the Registrants Registration Statement (No. 33-20827) filed on August 4, 2010. |
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(13) |
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Distribution Agreement Supplement (S1 Fund and Robeco Boston Partners Long/Short Research Fund) between Registrant and BNY Mellon Distributors, Inc. is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(14) |
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Form of Distribution Agreement Supplement (Robeco Boston Partners Global Equity Fund and Robeco Boston Partners International Equity Fund) between Registrant and BNY Mellon Distributors, Inc. is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(f) |
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Bonus or Profit Sharing Contracts. |
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(1) |
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Fund Office Retirement Profit-Sharing and Trust Agreement, dated as of October 24, 1990, as amended is incorporated herein by reference to Post-Effective Amendment No. 49 to the Registrants Registration Statement (No. 33-20827) filed on December 1, 1997. |
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(2) |
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Form of Amendment No. 1 to Fund Office Retirement Profit Sharing Plan and Trust Reflecting EGTRRA is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(g) |
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Custodian Agreements. |
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(1) |
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Custody Agreement dated July 18, 2011 between Registrant and The Bank of New York Mellon is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(2) |
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Foreign Custody Manager Agreement dated July 18, 2011 between Registrant and The Bank of New York Mellon is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(3) |
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Form of Amended and Restated Schedule II to the Custody Agreement ( Robeco Boston Partners Global Equity Fund and Robeco Boston Partners International Equity Fund ) is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(h) |
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Other Material Contracts. |
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(1) |
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Transfer Agency Agreement (Sansom Street) between Registrant and Provident Financial Processing Corporation, dated as of August 16, 1988 is incorporated herein by reference to Post-Effective Amendment No. 1 to Registrants Registration Statement (No. 33-20827) filed on March 23, 1989, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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(2) |
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Shareholder Servicing Agreement (Sansom Street Money Market) is incorporated herein by reference to Post-Effective Amendment No. 1 to Registrants Registration Statement (No. 33-20827) filed on March 23, 1989, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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(3) |
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Shareholder Servicing Agreement (Sansom Street Government Obligations Money Market) is incorporated herein by reference to Post-Effective Amendment No. 1 to Registrants Registration Statement (No. 33-20827) filed on March 23, 1989, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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(4) |
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Shareholder Services Plan (Sansom Street Money Market) is incorporated herein by reference to Post-Effective Amendment No. 1 to Registrants Registration Statement (No. 33-20827) filed on March 23, 1989, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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(5) |
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Transfer Agency Agreement (Bedford Money Market) between Registrant and Provident Financial Processing Corporation, dated as of August 16, 1988 is incorporated herein by reference to Post-Effective Amendment No. 1 to Registrants Registration Statement (No. 33-20827) filed on March 23, 1989, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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(6) |
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Transfer Agency Agreement and Supplements (Bradford, Beta, Gamma, Delta, Epsilon, Zeta, Eta and Theta) between Registrant and Provident Financial Processing Corporation dated as of November 5, 1991 is incorporated herein by reference to Post-Effective Amendment No. 7 to the Registrants Registration Statement (No. 33-20827) filed on July 15, 1992, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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(7) |
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Transfer Agency and Service Agreement between Registrant and State Street Bank and Trust Company and PNC Global Investment Servicing (U.S.) Inc. (f/k/a PFPC Inc.) dated February 1, 1995 is incorporated herein by reference to Post-Effective Amendment No. 28 to the Registrants Registration Statement (No. 33-20827) filed on October 6, 1995. |
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(8) |
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Supplement to Transfer Agency and Service Agreement between Registrant, State Street Bank and Trust Company, Inc. and PNC Global Investment Servicing (U.S.) Inc. (f/k/a PFPC Inc.) dated April 10, 1995 is incorporated herein by reference to Post-Effective Amendment No. 28 to the Registrants Registration Statement (No. 33-20827) filed on October 6, 1995. |
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(9) |
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Amended and Restated Credit Agreement dated December 15, 1994 is incorporated herein by reference to Post-Effective Amendment No. 29 to the Registrants Registration Statement (No. 33-20827) filed on October 25, 1995. |
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(10) |
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Transfer Agreement and Service Agreement between Registrant and State Street Bank and Trust Company is incorporated herein by reference to Post-Effective Amendment No. 37 to the Registrants Registration Statement (No. 33-20827) filed on July 30, 1996. |
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(11) |
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Transfer Agency Agreement Supplement (Boston Partners Mid Cap Value Fund - Institutional Class) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 46 to the Registrants Registration Statement (No. 33-20827) filed on September 25, 1997. |
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(12) |
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Transfer Agency Agreement Supplement (Boston Partners Mid Cap Value Fund - Investor Class) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 46 to the Registrants Registration Statement (No. 33-20827) filed on September 25, 1997. |
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(13) |
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Administration and Accounting Services Agreement (Boston Partners Mid Cap Value Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) dated, May 30, 1997 is incorporated herein by reference to Post-Effective Amendment No. 46 to the Registrants Registration Statement (No. 33-20827) filed on September 25, 1997. |
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(14) |
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Administration and Accounting Services Agreement (Schneider Small Cap Value Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 60 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1998. |
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(15) |
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Transfer Agency Agreement Supplement (Schneider Small Cap Value Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 60 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1998. |
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(16) |
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Transfer Agency Agreement Supplement (Boston Partners Small Cap Value Fund II (formerly Micro Cap Value) - Institutional Class) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 60 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1998. |
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(17) |
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Transfer Agency Agreement Supplement (Boston Partners Small Cap Value Fund II (formerly Micro Cap Value) - Investor Class) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 60 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1998. |
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(18) |
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Administration and Accounting Services Agreement (Boston Partners Small Cap Value Fund II (formerly Boston Partners Micro Cap Value Fund)) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 60 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1998. |
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(19) |
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Administrative and Accounting Services Agreement (Boston Partners Long/Short Equity Fund (formerly Market Neutral) - Institutional and Investor Classes) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 63 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 1998. |
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(20) |
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Transfer Agency Agreement Supplement (Boston Partners Long/Short Equity Fund (formerly Market Neutral) - Institutional and Investor Classes) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 63 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 1998. |
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(21) |
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Form of Transfer Agency Agreement Supplement (Boston Partners Fund (formerly Long-Short Equity)) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 65 to the Registrants Registration Statement (No. 33-20827) filed on May 19, 1999. |
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(22) |
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Form of Administration and Accounting Services Agreement (Boston Partners Fund (formerly Long-Short Equity)) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 65 to the Registrants Registration Statement (No. 33-20827) filed on May 19, 1999. |
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(23) |
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Transfer Agency Agreement Supplement (Bogle Investment Management Small Cap Growth Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 67 to the Registrants Registration Statement (No. 33-20827) filed on September 30, 1999. |
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(24) |
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Non 12b-1 Shareholder Services Plan and Agreement (Bogle Investment Management Small Cap Growth - Investor Shares) is incorporated herein by reference to Post-Effective Amendment No. 67 to the Registrants Registration Statement (No. 33-20827) filed on September 30, 1999. |
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(25) |
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Agreement between E*TRADE Group, Inc., Registrant and Registrants principal underwriter is incorporated herein by reference to Post-Effective Amendment No. 69 to the Registrants Registration Statement (No. 33-20827) filed on December 1, 1999. |
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(26) |
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Administration and Accounting Services Agreement (Bogle Investment Management Small Cap Growth Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 69 to the Registrants Registration Statement (No. 33-20827) filed on December 1, 1999. |
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(27) |
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Form of Transfer Agency Supplement (Boston Partners All-Cap Value Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(28) |
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Form of Administration and Accounting Services Agreement (Boston Partners All-Cap Value Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 77 to the Registrants Registration Statement (No. 33-20827) filed on May 15, 2002. |
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(29) |
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Transfer Agency Supplement (Schneider Value Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(30) |
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Form of Administration and Accounting Services Agreement (Schneider Value Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 78 to the Registrants Registration Statement (No. 33-20827) filed on May 16, 2002. |
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(31) |
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Shareholder Servicing Agreement (Bogle Investment Management Small Cap Growth Fund) is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(32) |
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Form of Transfer Agency Agreement Supplement (Customer Identification Program) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 84 to the Registrants Registration Statement (No. 33-20827) filed on December 29, 2003. |
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(33) |
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Regulatory Administration Services Agreement between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 84 to the Registrants Registration Statement (No. 33-20827) filed on December 29, 2003. |
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(34) |
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Administration and Accounting Services Agreement (Robeco WPG Core Bond Fund, Robeco WPG Large Cap Growth Fund, and Robeco WPG Tudor Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 100 to the Registrants Registration Statement (No. 33-20827) filed on November 25, 2005. |
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(35) |
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Transfer Agency Agreement Supplement (Robeco WPG Small/Micro Cap Value Fund f/k/a Robeco WPG Tudor Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 100 to the Registrants Registration Statement (No. 33-20827) filed on November 25, 2005. |
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(36) |
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Non-12b-1 Shareholder Services Plan and Related Form of Shareholder Servicing Agreement (Robeco WPG Small/Micro Cap Value Fund f/k/a Robeco WPG Tudor Fund Institutional Class) is incorporated herein by reference to Post-Effective Amendment No. 100 to the Registrants Registration Statement (No. 33-20827) filed on November 25, 2005. |
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(37) |
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Administration and Accounting Services Agreement (Bear Stearns CUFS MLP Mortgage Portfolio) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 108 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 2006. |
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(38) |
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Transfer Agency Agreement Supplement (Bear Stearns CUFS MLP Mortgage Portfolio) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 108 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 2006. |
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(39) |
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Amended Schedule A to Regulatory Administration Services Agreement ( Bear Stearns CUFS MLP Mortgage Portfolio) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 108 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 2006. |
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(40) |
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Form of Money Market Fund Services Agreement to Delegation Agreement (Money Market Portfolio) between Registrant, BNY Mellon Investment Servicing (US) Inc. (f/k/a PNC Global Investment Servicing (U.S.) Inc.) , and BlackRock Institutional Management Corp. is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(41) |
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Administration and Accounting Services Agreement (Marvin & Palmer Large Cap Growth Fund) is incorporated herein by reference to Post-Effective Amendment No. 124 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2007. |
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(42) |
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Amended Schedule A to Regulatory Administration Services Agreement ( Marvin & Palmer Large Cap Growth Fund ) is incorporated herein by reference to Post-Effective Amendment No. 124 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2007. |
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(43) |
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Transfer Agency Agreement Supplement (Marvin & Palmer Large Cap Growth Fund) is incorporated herein by reference to Post-Effective Amendment No. 24 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2007. |
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(44) |
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Transfer Agency Agreement Supplement (Free Market U.S. Equity Fund ) is incorporated herein by reference to Post-Effective Amendment No. 126 to the Registrants Registration Statement (No. 33-20827) filed on October 24, 2008. |
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(45) |
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Transfer Agency Agreement Supplement (Free Market International Equity Fund ) is incorporated herein by reference to Post-Effective Amendment No. 126 to the Registrants Registration Statement (No. 33-20827) filed on October 24, 2008. |
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(46) |
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Transfer Agency Agreement Supplement (Free Market Fixed Income Fund ) is incorporated herein by reference to Post-Effective Amendment No. 126 to the Registrants Registration Statement (No. 33-20827) filed on October 24, 2008. |
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(47) |
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Amended Schedule A to Regulatory Administration Services Agreement (Free Market U.S. Equity Fund, Free Market International Equity Fund, Free Market Fixed-Income Fund ) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PFPC Inc.) is incorporated herein by reference to Post-Effective Amendment No. 126 to the Registrants Registration Statement (No. 33-20827) filed on October 24, 2008. |
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(48) |
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Form of Transfer Agency Agreement Supplement (Red Flags Amendment) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PNC Global Investment Servicing (U.S.) Inc . ) is incorporated herein by reference to Post-Effective Amendment No. 127 to the Registrants Registration Statement (No. 33-20827) filed on December 29, 2008. |
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(49) |
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Form of Transfer Agency Agreement Supplement (Perimeter Small Cap Growth Fund) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PNC Global Investment Servicing (U.S.) Inc.) is incorporated herein by reference to Post Effective Amendment No. 132 to the Registration Statement (No. 33-20827) filed on October 22, 2009. |
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(50) |
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Administration and Accounting Services Agreement (Perimeter Small Cap Growth Fund) is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(51) |
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Amended Schedule A to the Regulatory Administration Services Agreement ( Perimeter Small Cap Growth Fund ) between Registrant and BNY Mellon Asset Servicing (US) Inc. (f/k/a PNC Global Investment Servicing (U.S.) Inc.) is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010.. |
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(52) |
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Form of Administrative and Accounting Services Agreement (S1 Fund) between Registrant and BNY Mellon Investment Servicing (U.S.) Inc. (f/k/a PNC Global Investment Servicing (U.S.) Inc.) is incorporated herein by reference to Post-Effective Amendment No. 137 to the Registrants Registration Statement (No. 33-20827) filed on October 1, 2010. |
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(53) |
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Form of Transfer Agency Agreement Supplement (S1 Fund) between Registrant and BNY Mellon Investment Servicing (U.S.) Inc . (f/k/a PNC Global Investment Servicing (U.S.) Inc.) is incorporated herein by reference to Post-Effective Amendment No. 137 to the Registrants Registration Statement (No. 33-20827) filed on October 1, 2010. |
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(54) |
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Form of Amended Schedule A to Regulatory Administration Services Agreement (S1 Fund) between Registrant and BNY Mellon Investment Servicing (U.S.) Inc. ( f/k/a PNC Global Investment Servicing (U.S.) Inc.) is incorporated herein by reference to Post-Effective Amendment No. 137 to the Registrants Registration Statement (No. 33-20827) filed on October 1, 2010. |
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(55) |
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Form of Administration and Accounting Services Agreement (Robeco Boston Partners Long/Short Research Fund) between Registrant and BNY Mellon Investment Servicing (U.S.) Inc. is incorporated herein by reference to Post-Effective Amendment No. 136 to the Registrants Registration Statement (No. 33-20827) filed on August 4, 2010. |
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(56) |
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Form of Transfer Agency Agreement Supplement (Robeco Boston Partners Long/Short Research Fund) between Registrant and BNY Mellon Investment Servicing (U.S.) Inc. is incorporated herein by reference to Post-Effective Amendment No. 136 to the Registrants Registration Statement (No. 33-20827) filed on August 4, 2010. |
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(57) |
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Form of Amended Schedule A to Regulatory Administration Services Agreement (Robeco Boston Partners Long/Short Research Fund) between Registrant and BNY Mellon Investment Servicing (U.S.) Inc. is incorporated herein by reference to Post-Effective Amendment No. 136 to the Registrants Registration Statement (No. 33-20827) filed on August 4, 2010. |
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(58) |
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Form of Money Market Fund Services Agreement to Delegation Agreement (Money Market Portfolio) between Registrant, BNY Mellon Investment Servicing (US) Inc., and BlackRock Advisors, LLC (f/k/a BlackRock Institutional Management Corp.) is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(59) |
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Form of Transfer Agency Agreement Supplement (Robeco Boston Global Equity Fund and Robeco Boston Partners International Equity Fund) between Registrant and BNY Mellon Investment Servicing (U.S.) Inc. is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(60) |
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Form of Amended Schedule A to Regulatory Administration Services Agreement (Robeco Boston Global Equity Fund and Robeco Boston Partners International Equity Fund) between Registrant and BNY Mellon Investment Servicing (U.S.) Inc. is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(61) |
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Form of Administration and Accounting Services Agreement (Robeco Boston Global Equity Fund and Robeco Boston Partners International Equity Fund) between Registrant and BNY Mellon Investment Servicing (U.S.) Inc. to be filed by amendment. |
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(i) |
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(1) |
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Opinion and Consent of Counsel to be filed by amendment. |
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(2) |
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Consent of Counsel to be filed by amendment. |
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(j) |
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None. |
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(k) |
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None. |
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(l) |
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Initial Capital Agreements. |
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(1) |
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Subscription Agreement, relating to Classes A through N, is incorporated herein by reference to Pre-Effective Amendment No. 2 to Registrants Registration Statement (No. 33-20827) filed on July 12, 1988, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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(2) |
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Subscription Agreement between Registrant and Planco Financial Services, Inc., relating to Classes O and P is incorporated herein by reference to Post-Effective Amendment No. 5 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 1990. |
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(3) |
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Subscription Agreement between Registrant and Planco Financial Services, Inc., relating to Class Q is incorporated herein by reference to Post-Effective Amendment No. 5 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 1990. |
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(4) |
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Subscription Agreement between Registrant and Counsellors Securities Inc. relating to Classes R, S, and Alpha 1 through Theta 4 is incorporated herein by reference to Post-Effective Amendment No. 7 to the Registrants Registration Statement (No. 33-20827) filed on July 15, 1992, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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(5) |
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Purchase Agreement between Registrant and Boston Partners Asset Management, L.P. relating to Classes TT and UU (Boston Partners Mid Cap Value Fund) is incorporated herein by reference to Post-Effective Amendment No. 46 to the Registrants Registration Statement (No. 33-20827) filed on September 25, 1997. |
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(6) |
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Purchase Agreement between Registrant and Schneider Capital Management Company relating to Class YY (Schneider Small Cap Value Fund) is incorporated herein by reference to Post-Effective Amendment No. 60 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1998. |
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(7) |
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Purchase Agreement between Registrant and Boston Partners Asset Management, L.P. relating to Classes DDD and EEE (Boston Partners Small Cap Value Fund II (formerly Micro Cap Value)) is incorporated herein by reference to Post-Effective Amendment No. 60 to the Registrants Registration Statement (No. 33-20827) filed on October 29, 1998. |
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(8) |
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Purchase Agreement between Registrant and Boston Partners Asset Management relating to Classes III and JJJ (Boston Partners Long/Short Equity Fund (formerly Market Neutral)) is incorporated herein by reference to Post-Effective Amendment No. 63 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 1998. |
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(9) |
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Form of Purchase Agreement between Registrant and Boston Partners Asset Management, L. P. relating to Classes KKK and LLL (Boston Partners Fund (formerly Long-Short Equity)) is incorporated herein by reference to Post-Effective Amendment No. 65 to the Registrants Registration Statement (No. 33-20827) filed on May 19, 1999. |
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(10) |
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Purchase Agreement (Bogle Investment Management Small Cap Growth Fund) between Registrant and Bogle Investment Management, L.P. is incorporated herein by reference to Post-Effective Amendment No. 67 to the Registrants Registration Statement (No. 33-20827) filed on September 30, 1999. |
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(11) |
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Purchase Agreement (Boston Partners All-Cap Value Fund) between Registrant and Boston Partners Asset Management, L.P. is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(12) |
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Purchase Agreement (Schneider Value Fund) between Registrant and Schneider Capital Management Company is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(13) |
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Purchase Agreement (Robeco WPG Small/Micro Cap Value Fund f/k/a Robeco WPG Tudor Fund) between Registrant and Weiss, Peck & Greer Investments is incorporated herein by reference to Post-Effective Amendment No. 96 to the Registrants Registration Statement (No. 33-20827) filed on June 6, 2005. |
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(14) |
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Purchase Agreement (Bear Stearns CUFS MLP Mortgage Portfolio) between Registrant and Bear Stearns Asset Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 111 to the Registrants Registration Statement (No. 33-20827) filed on February 28, 2007. |
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(15) |
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Purchase Agreement (Marvin & Palmer Large Cap Growth Fund) is incorporated herein by reference to Post-Effective Amendment No. 124 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2007. |
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(16) |
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Form of Purchase Agreement (Free Market U.S. Equity Fund) between Registrant and Matson Money, Inc. (f/k/a Abundance Technologies, Inc.), is incorporated herein by reference to Post-Effective Amendment No. 112 to the Registrants Registration Statement (No. 33-20827) filed on June 1, 2007. |
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(17) |
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Form of Purchase Agreement (Free Market International Equity Fund) between Registrant and Matson Money, Inc. (f/k/a Abundance Technologies, Inc.) , is incorporated herein by reference to Post-Effective Amendment No. 112 to the Registrants Registration Statement (No. 33-20827) filed on June 1, 2007. |
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(18) |
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Form of Purchase Agreement (Free Market Fixed Income Fund) between Registrant and Matson Money, Inc. (f/k/a Abundance Technologies, Inc.) , is incorporated herein by reference to Post-Effective Amendment No. 112 to the Registrants Registration Statement (No. 33-20827) filed on June 1, 2007. |
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(19) |
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Form of Purchase Agreement ( Perimeter Small Cap Growth Fund ) between Registrant and Perimeter Capital Management, LLC is incorporated herein by reference to Post-Effective Amendment No. 134 to the Registrants Registration Statement (No. 33-20827) filed on December 30, 2009. |
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(20) |
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Purchase Agreement (S1 Fund) between Registrant and Simple Alternatives, LLC is incorporated herein by reference to Post-Effective Amendment No. 138 to the Registration Statement (No. 33-20827) filed on October 29, 2010. |
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(21) |
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Form of Purchase Agreement (Robeco Boston Partners Long/Short Research Fund) between Registrant and Robeco Investment Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 136 to the Registrants Registration Statement (No. 33-20827) filed on August 4, 2010. |
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(22) |
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Form of Purchase Agreement (Robeco Boston Partners Global Equity Fund) between Registrant and Robeco Investment Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 142 t the Registrants Registation Statement (No. 33-20827) filed on October 14, 2011. |
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(23) |
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Form of Purchase Agreement (Robeco Boston Partners International Equity Fund) between Registrant and Robeco Investment Management Inc. is incorporated herein by reference to Post-Effective Amendment No. 142 t the Registrants Registation Statement (No. 33-20827) filed on October 14, 2011. |
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(24) |
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Form of Purchase Agreement (Summit Global Investments U.S. Low Volatility Equity Fund) between Registrant and Summit Global Investments, LLC is filed herewith. |
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(m) |
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Rule 12b-1 Plan. |
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(1) |
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Plan of Distribution (Bedford Money Market) is incorporated herein by reference to Post-Effective Amendment No. 1 to Registrants Registration Statement (No. 33-20827) filed on March 23, 1989, and refiled electronically with Post-Effective Amendment No. 61 to Registrants Registration Statement filed on October 30, 1998. |
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(2) |
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Plan of Distribution (Boston Partners Mid Cap Value Fund - Investor Class) is incorporated herein by reference to Post-Effective Amendment No. 45 to the Registrants Registration Statement (No. 33-20827) filed on May 9, 1997. |
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(3) |
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Plan of Distribution (Boston Partners Small Cap Value Fund II (formerly Micro Cap Value) - Investor Class) is incorporated herein by reference to Post-Effective Amendment No. 53 to the Registrants Registration Statement (No. 33-20827) filed on April 10, 1998. |
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(4) |
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Amendment to Plans of Distribution pursuant to Rule 12b-1 is incorporated herein by reference to Post-Effective Amendment No. 63 to the Registrants Registration Statement (No. 33-20827) filed on December 14, 1998. |
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(5) |
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Plan of Distribution (Boston Partners Long/Short Equity Fund (formerly Market Neutral) - Investor Class) is incorporated herein by reference to Post-Effective Amendment No. 62 to the Registrants Registration Statement (No. 33-20827) filed on November 12, 1998. |
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(6) |
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Plan of Distribution (Boston Partners Fund (formerly Long Short Equity) - Investor Class) is incorporated herein by reference to Post-Effective Amendment No. 65 to the Registrants Registration Statement (No. 33-20827) filed on May 19, 1999. |
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(7) |
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Plan of Distribution pursuant to Rule 12b-1 (Boston Partners All-Cap Value Fund) is incorporated herein by reference to Post-Effective Amendment No. 80 to the Registrants Registration Statement (No. 33-20827) filed on November 1, 2002. |
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(8) |
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Agreement between Registrant, Bear Stearns Securities Corp. and BNY Mellon Distributors, Inc. (f/k/a PFPC Distributors, Inc.) dated as of November 17, 2005 is incorporated herein by reference to Post-Effective Amendment No. 101 to the Registrants Registration Statement filed on December 29, 2005. |
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(9) |
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Plan of Distribution pursuant to Rule 12b-1 (Perimeter Small Cap Growth Fund Investor Class) between Registrant and Perimeter Capital Management LLC is incorporated herein by reference to Post-Effective Amendment No. 132 to the Registration Statement (No. 33-20827) filed on October 22, 2009. |
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(10) |
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Plan of Distribution pursuant to Rule 12b-1( Robeco Boston Partners Long/Short Research Fund Investor Class ) is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(11) |
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Plan of Distribution pursuant to Rule 12b-1 (S1 Fund R Shares) is incorporated herein by reference to Post-Effective Amendment No. 137 to the Registrants Registration Statement (No. 33-20827) filed on October 1, 2010. |
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(12) |
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Plan of Distribution pursuant to Rule 12b-1( Robeco Boston Partners Global Equity Fund Investor Class) is incorporated herein by reference to Post-Effective Amendment No. 142 to the Registrants Registration Statement (No. 33-20827) filed on October 14, 2011. |
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(13) |
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Plan of Distribution pursuant to Rule 12b-1 ( Robeco Boston Partners International Equity Fund Investor Class) is incorporated herein by reference to Post-Effective Amendment No. 142 to the Registrants Registration Statement (No. 33-20827) filed on October 14, 2011. |
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(14) |
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Plan of Distribution pursuant to Rule 12b-1 ( Summit Global Investments U.S. Low Volatility Equity Fund Retail Class) is filed herewith. |
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(15) |
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Plan of Distribution pursuant to Rule 12b-1 ( Summit Global Investments U.S. Low Volatility Equity Fund Class A) is filed herewith. |
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(n) |
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Rule 18f-3 Plan. |
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(1) |
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Amended Rule 18f-3 Plan is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(p) |
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Code of Ethics. |
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(1) |
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Code of Ethics of the Registrant is incorporated herein by reference to Post-Effective Amendment No. 110 to Registrants Registration Statement (No. 33-20827) filed on December 29, 2006. |
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(2) |
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Code of Ethics of Robeco Investment Management is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(3) |
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Code of Ethics of Schneider Capital Management Company is incorporated herein by reference to Post-Effective Amendment No. 129 to the Registrants Registration Statement (No. 33-20827) filed on July 2, 2009. |
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(4) |
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Code of Ethics of Bogle Investment Management, L.P. is incorporated herein by reference to Post-Effective Amendment No. 129 to the Registrants Registration Statement (No. 33-20827) filed on July 2, 2009. |
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(5) |
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Code of Ethics of J.P Morgan Chase & Co. is incorporated herein by reference to Post-Effective Amendment No. 141 to the Registrants Registration Statement (No. 33-20827) filed on December 28, 2010. |
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(6) |
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Code of Ethics of Marvin & Palmer Associates, Inc., is incorporated herein by reference to Post-Effective Amendment No. 129 to the Registrants Registration Statement (No. 33-20827) filed on July 2, 2009. |
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(7) |
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Code of Ethics of Matson Money, Inc. is) is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(8) |
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Code of Ethics of Perimeter Capital Management LLC is incorporated herein by reference to Post-Effective Amendment No. 132 to the Registration Statement (No. 33-20827) filed on October 22, 2009. |
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(9) |
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Code of Ethics of Simple Alternatives, LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(10) |
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Code of Ethics of Blue Lion Capital Management, LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(11) |
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Code of Ethics of Courage Capital Management, LLC is incorporated herein by reference to Post-Effective Amendment No. 137 to the Registrants Registration Statement (No. 33-20827) filed on October 1, 2010. |
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(12) |
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Code of Ethics of Cramer Rosenthal McGlynn LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(13) |
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Code of Ethics of Lauren Templeton Capital Management, LLC is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(14) |
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Code of Ethics of Starwood Real Estate Securities, LLC is incorporated herein by reference to Post-Effective Amendment No. 137 to the Registrants Registration Statement (No. 33-20827) filed on October 1, 2010. |
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(15) |
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Code of Ethics of Trellus Management Co., LLC is incorporated herein by reference to Post-Effective Amendment No. 137 to the Registrants Registration Statement (No. 33-20827) filed on October 1, 2010. |
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(16) |
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Code of Ethics of BNY Mellon Distributors, Inc. is incorporated herein by reference to Post-Effective Amendment No. 143 to the Registrants Registration Statement (No. 33-20827) filed on October 28, 2011. |
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(17) |
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Code of Ethics of Summit Global Investments, LLC to be filed by amendment. |
Item 29. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
None.
Item 30. INDEMNIFICATION
Sections 1, 2, 3 and 4 of Article VIII of Registrants Articles of Incorporation, as amended, incorporated herein by reference as Exhibits (a)(1) and (a)(3), provide as follows:
Section 1. To the fullest extent that limitations on the liability of directors and officers are permitted by the Maryland General Corporation Law, no director or officer of the Corporation shall have any liability to the Corporation or its shareholders for damages. This limitation on liability applies to events occurring at the time a person serves as a director or officer of the Corporation whether or not such person is a director or officer at the time of any proceeding in which liability is asserted.
Section 2. The Corporation shall indemnify and advance expenses to its currently acting and its former directors to the fullest extent that indemnification of directors is permitted by the Maryland General Corporation Law. The Corporation
shall indemnify and advance expenses to its officers to the same extent as its directors and to such further extent as is consistent with law. The Board of Directors may by law, resolution or agreement make further provision for indemnification of directors, officers, employees and agents to the fullest extent permitted by the Maryland General Corporation law.
Section 3. No provision of this Article shall be effective to protect or purport to protect any director or officer of the Corporation against any liability to the Corporation or its security holders to which he would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his office.
Section 4. References to the Maryland General Corporation Law in this Article are to the law as from time to time amended. No further amendment to the Articles of Incorporation of the Corporation shall decrease, but may expand, any right of any person under this Article based on any event, omission or proceeding prior to such amendment. Insofar as indemnification for liability arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of Registrant pursuant to the foregoing provisions, or otherwise, Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by Registrant of expenses incurred or paid by a director, officer or controlling person of Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
Section 12 of the Investment Advisory and Administration Agreement Registrant and BlackRock Advisors, LLC (BALLC), dated June 30, 2011 1998 and incorporated herein by reference to exhibit (d)(10), provides for the indemnification of BALLC against certain losses.
Section 12 of each of the Investment Advisory Agreements between Registrant and Robeco Investment Management, Inc. (Robeco) ( f/k/a Boston Partners Asset Management, LLC (Boston Partners) and Weiss, Peck & Greer Investments) , incorporated herein by reference to exhibits (d)(2), (d)(3), (d)(4), (d)(6), (d)(8) ,(d)(33), (d)(35) and (d)(36), provides for the indemnification of Robeco against certain losses.
Section 12 of the Investment Advisory Agreement between Registrant and Bogle Investment Management, L.P. (Bogle), dated September 15, 1999 and incorporated herein by reference to exhibit (d)(5) provides for the indemnification of Bogle against certain losses.
Section 9 of the Distribution Agreement between Registrant and BNY Mellon Distributors Inc. (f/k/a PFPC Distributors, Inc. ), dated January 2, 2001 and incorporated herein by reference to exhibit (e)(1) provides for the indemnification of BNY Mellon Distributors Inc. against certain losses.
Section 12 of each of the Investment Advisory Agreements between the Registrant and Schneider Capital Management (Schneider) incorporated herein by reference as exhibits (d)(1) and (d)(7) provides for the indemnification of Schneider against certain losses.
Section 12 of the Investment Advisory Agreement between the Registrant and Bear Stearns Asset Management Inc., (Bear Stearns), on behalf of the Bear Stearns CUFS MLP Mortgage Portfolio , dated August 12, 2008 and incorporated herein by reference as exhibit (d)(9) provides for the indemnification of Bear Stearns against certain losses.
Section 12 of the Investment Advisory Agreement between the Registrant and Marvin & Palmer Associates, Inc., (Marvin & Palmer Associates) dated March 5, 2007 and incorporated herein by reference as exhibit (d)(11) provides for the indemnification of Marvin & Palmer Associates against certain losses.
Section 12 of the Investment Advisory Agreement between the Registrant and Matson Money, Inc. ( f/k/a Abundance Technologies, Inc.) , (Matson Money) dated December 31, 2007 and incorporated herein by reference as exhibit (d)(12) provides for the indemnification of Matson Money against certain losses.
Section 12 of the Investment Advisory Agreement between the Registrant and Perimeter Capital Management (Perimeter) dated September 30, 2011 and incorporated herein by reference as exhibit (d)(20) provides for the indemnification of Perimeter against certain losses.
Section 12 of the Investment Advisory Agreement between the Registrant and Simple Alternatives, LLC (SA) dated September 30, 2010 and incorporated herein by reference as exhibit (d)(22) provides for the indemnification of SA against certain losses.
Section 12 of the Investment Advisory Agreement between the Registrant and Summit Global Investments, LLC (SGI) incorporated herein by reference as exhibit (d)(36) provides for the indemnification of SGI against certain losses.
Item 31. |
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BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT ADVISERS. |
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1. |
BlackRock Advisors, LLC: BlackRock Advisors, LLC (BA) principal business address is 100 Bellevue Parkway, Wilmington, Delaware 19809. BA is registered under the Investment Advisers Act of 1940, as amended, and serves as an investment adviser for registered investment companies. Information as to the directors and officers of BA for the past two fiscal years is as follows: |
Name and Position with
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Other Company |
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Position with Other Company |
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Ann Marie Petach, Chief Financial Officer and Managing Director |
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BAA Holdings, LLC,
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Chief Financial Officer, Managing Director, and Director |
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BlackRock, Inc.,
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Chief Financial Officer and Managing Director |
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BlackRock Advisors, LLC,
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Chief Financial Officer and Managing Director |
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BlackRock Advisors Holdings, Inc.,
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Chief Financial Officer and Managing Director |
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BlackRock Capital Holdings, Inc.,
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Chief Financial Officer and Managing Director |
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BlackRock Capital Management, Inc.,
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Chief Financial Officer and Managing Director |
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BlackRock Cayco Limited,
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Director |
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BlackRock Cayman Company,
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Director |
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BlackRock Cayman Finco Limited,
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Director |
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BlackRock Financial Management, Inc.,
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Chief Financial Officer and Managing Director |
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BlackRock Finco, LLC,
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Director |
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BlackRock Funding, Inc.,
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Chief Financial Officer and Managing Director |
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BlackRock Funding International, Ltd.,
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Vice Chairman, Chief Financial Officer, and Managing Director |
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BlackRock Holdco 2, Inc.
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Chief Financial Officer and Managing Director |
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BlackRock Holdco 4, LLC,
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Director |
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BlackRock Holdco 6, LLC,
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Director |
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BlackRock Institutional Trust Company, National Association,
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Director |
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BlackRock Institutional Trust Company, N.A. - London Branch,
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Director |
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BlackRock Institutional Trust Company, N.A. - Sydney Branch,
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Director |
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BlackRock International Holdings, Inc.,
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Chief Financial Officer and Managing Director |
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BlackRock Investment Management, LLC,
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Chief Financial Officer and Managing Director |
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BlackRock Lux Finco S.a r.l.,
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Chief Financial Officer and Managing Director |
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BlackRock Operations (Luxembourg) S.a r.l.,
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Chief Financial Officer and Managing Director |
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BlackRock UK 1 LP,London, England |
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Chief Financial Officer and Managing Director |
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State Street Research & Management Company,
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Chief Financial Officer and Managing Director |
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SSRM Holdings, Inc.,
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Robert P. Connolly, General Counsel, Managing Director and Secretary |
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BAA Holdings, LLC,
|
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General Counsel, Managing Director and Secretary |
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BlackRock, Inc.,
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General Counsel, Managing Director and Secretary |
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BlackRock Advisors, LLC,
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General Counsel, Managing Director and Secretary |
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BlackRock Advisors Holdings, Inc.,
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General Counsel, Managing Director and Secretary |
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BlackRock Capital Holdings, Inc.,
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General Counsel, Managing Director and Secretary |
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BlackRock Capital Management, Inc.,
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General Counsel, Managing Director and Secretary |
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BlackRock Execution Services,
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General Counsel, Managing Director and Secretary |
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BlackRock Financial Management, Inc.,
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General Counsel, Managing Director and Secretary |
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BlackRock Fund Distribution Company,
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General Counsel, Managing Director and Secretary |
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BlackRock Funding, Inc.,
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General Counsel, Managing Director and Secretary |
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BlackRock Funding International, Ltd.,
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General Counsel, Managing Director and Secretary |
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BlackRock Holdco 2, Inc.
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General Counsel, Managing Director and Secretary |
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BlackRock International Holdings, Inc.,
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General Counsel, Managing Director and Secretary |
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BlackRock Investments, LLC,
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General Counsel, Managing Director and Secretary |
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BlackRock Investment Management, LLC,
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General Counsel, Managing Director and Secretary |
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BlackRock Lux Finco S.a r.l.,
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General Counsel, Managing Director and Secretary |
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BlackRock Operations (Luxembourg) S.a r.l.,
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General Counsel, Managing Director and Secretary |
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State Street Research & Management Company,
|
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General Counsel, Managing Director and Secretary |
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SSRM Holdings, Inc.,
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General Counsel, Managing Director and Secretary |
Laurence D. Fink, Chief Executive Officer and Director |
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BAA Holdings, LLC,
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Chief Executive Officer and Director |
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BlackRock, Inc.,
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Chief Executive Officer and Director |
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BlackRock Advisors, LLC,
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Chief Executive Officer and Director |
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BlackRock Advisors Holdings, Inc.,
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Chief Executive Officer and Director |
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BlackRock Advisors Singapore Pte. Ltd.,
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Chief Executive Officer |
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BlackRock Asset Management International, Inc.,
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Director |
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BlackRock Capital Holdings, Inc.,
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Chief Executive Officer and Director |
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BlackRock Capital Management, Inc.,
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Chief Executive Officer and Director |
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BlackRock Capital Markets, LLC,
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Chairman and Director |
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BlackRock Corporation US, Inc.,
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Chairman, Chief Executive Officer, and Director |
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BlackRock Delaware Holdings, Inc.,
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Chairman, Chief Executive Officer, and Director |
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BlackRock Execution Services,
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Chairman and Director |
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BlackRock Financial Management, Inc.,
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Chief Executive Officer and Director |
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BlackRock Fund Advisors,
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Chairman, Chief Executive Officer, and Director |
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BlackRock Fund Distribution Company,
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Chairman and Director |
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BlackRock Funding, Inc.,
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Chief Executive Officer and Director |
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BlackRock Funding International, Ltd.,
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|
Chief Executive Officer and Director |
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BlackRock Growth Partners, Inc.,
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Chairman, Chief Executive Officer, and Director |
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BlackRock Holdco 2, Inc.,
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Chief Executive Officer |
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BlackRock HPB Management, LLC,
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Director |
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BlackRock International Holdings, Inc.,
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Chief Executive Officer and Director |
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BlackRock Investments, LLC,
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Chairman - Board of Managers |
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BlackRock Investment Management, LLC,
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Chief Executive Officer |
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BlackRock Portfolio Holdings, Inc.,
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Chairman, Chief Executive Officer, and Director |
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BlackRock Portfolio Investments, LLC,
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Chairman, Chief Executive Officer, and Director |
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DSP BlackRock Investment Managers Private Limited,
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Director |
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iShares Delaware Trust Sponsor, LLC,
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Director |
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State Street Research & Management Company,Boston, MA |
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Chief Executive Officer and Director |
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State Street Research Investment Services, Inc.,
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Director |
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SSRM Holdings, Inc.,
|
|
Chief Executive Officer and Director |
Robert S. Kapito, President and Director |
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BAA Holdings, LLC,
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President and Director |
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BlackRock, Inc.,
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President and Director |
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BlackRock Advisors, LLC,
|
|
President and Director |
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BlackRock Advisors Holdings, Inc.,
|
|
President and Director |
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BlackRock Advisors Singapore Pte. Ltd.,
|
|
President |
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BlackRock Asset Management International, Inc.,
|
|
Director |
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BlackRock Capital Holdings, Inc.,
|
|
President and Director |
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BlackRock Capital Management, Inc.,
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President and Director |
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BlackRock Capital Markets, LLC,
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Director |
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BlackRock Corporation US, Inc.,
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President and Director |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
President and Director |
|
|
BlackRock Execution Services,
|
|
Director |
|
|
BlackRock Financial Management, Inc.,
|
|
President and Director |
|
|
BlackRock Fund Advisors,
|
|
President and Director |
|
|
BlackRock Fund Distribution Company,
|
|
Director |
|
|
BlackRock Funding, Inc.,
|
|
President and Director |
|
|
BlackRock Funding International, Ltd.,
|
|
President and Director |
|
|
BlackRock Growth Partners, Inc.,
|
|
President and Director |
|
|
BlackRock Holdco 2, Inc.
|
|
President |
|
|
BlackRock International Holdings, Inc.,
|
|
President and Director |
|
|
BlackRock Investments, LLC,
|
|
Director - Board of Managers |
|
|
BlackRock Investment Management, LLC,
|
|
President |
|
|
BlackRock Portfolio Holdings, Inc.,
|
|
President and Director |
|
|
BlackRock Portfolio Investments, LLC, Wilmington, DE |
|
President and Director |
|
|
Carbon Capital III, Inc.
|
|
Director |
|
|
iShares Delaware Trust Sponsor, LLC,
|
|
Director |
|
|
State Street Research & Management Company,
|
|
President and Director |
|
|
State Street Research Investment Services, Inc.,
|
|
Director |
|
|
SSRM Holdings, Inc.,
|
|
President and Director |
Paul Audet, Senior Managing Director |
|
BAA Holdings, LLC,
|
|
Senior Managing Director |
|
|
BlackRock, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Advisors, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Capital Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Corporation US, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Financial Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Fund Advisors,
|
|
Senior Managing Director |
|
|
BlackRock Funding, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Growth Partners, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Holdco 2, Inc.
|
|
Senior Managing Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Investment Management, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Lux Finco S.a r.l.,
|
|
Senior Managing Director |
|
|
BlackRock Operations (Luxembourg) S.a r.l.,
|
|
Senior Managing Director |
|
|
BlackRock UK 1 LP,London, England |
|
Senior Managing Director |
|
|
State Street Research & Management Company,
|
|
Senior Managing Director |
|
|
SSRM Holdings, Inc.,
|
|
Senior Managing Director |
Charles Hallac, Senior Managing Director and Chief Operating Officer |
|
BlackRock, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Advisors, LLC,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Capital Management, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Corporation US, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Financial Management, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Fund Advisors,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Funding, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Funding International, Ltd.
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Growth Partners, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Holdco 2, Inc.
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock India Private Ltd.,
|
|
Director |
|
|
BlackRock Institutional Trust Company, National Association,
|
|
Chief Executive Officer, President and Director |
|
|
BlackRock Institutional Trust Company, N.A. - London Branch,
|
|
Director |
|
|
BlackRock Institutional Trust Company, N.A. - Sydney Branch,
|
|
Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Investment Management, LLC,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Portfolio Holdings, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
BlackRock Portfolio Investments, LLC,Wilmington, DE |
|
Senior Managing Director and Chief Operating Officer |
|
|
State Street Research & Management Company,
|
|
Senior Managing Director and Chief Operating Officer |
|
|
SSRM Holdings, Inc.,
|
|
Senior Managing Director and Chief Operating Officer |
Barbara Novick, Senior Managing Director |
|
BlackRock, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Advisors, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Capital Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Corporation US, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Financial Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Fund Advisors,
|
|
Senior Managing Director |
|
|
BlackRock Funding, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Funding International, Ltd.,
|
|
Senior Managing Director |
|
|
BlackRock Growth Partners, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Holdco 2, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Investment Management, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Portfolio Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Portfolio Investments, LLC,
|
|
Senior Managing Director |
|
|
SSRM Holdings, Inc.,
|
|
Senior Managing Director |
Peter Fisher, Senior Managing Director |
|
BlackRock, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Advisors, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Advisors Holdings, Inc.,New York, NY |
|
Senior Managing Director |
|
|
BlackRock Advisors Singapore Pte. Limited,
|
|
Senior Managing Director |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Capital Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Corporation US, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Financial Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Fund Advisors,
|
|
Senior Managing Director |
|
|
BlackRock Funding, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Funding International, Ltd.
|
|
Senior Managing Director |
|
|
BlackRock Growth Partners, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Holdco 2, Inc.
|
|
Senior Managing Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Investment Management, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Portfolio Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Portfolio Investments, LLC,
|
|
Senior Managing Director |
|
|
State Street Research & Management Company,
|
|
Senior Managing Director |
|
|
SSRM Holdings, Inc.,
|
|
Senior Managing Director |
Susan Wagner, Vice Chairman |
|
BAA Holdings, LLC,
|
|
Vice Chairman and Director |
|
|
BlackRock, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Advisors, LLC,
|
|
Vice Chairman |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Capital Management, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Corporation US, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Financial Management, Inc.,New York, NY |
|
Vice Chairman |
|
|
BlackRock Fund Advisors,
|
|
Vice Chairman |
|
|
BlackRock Funding, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Funding International, Ltd.
|
|
Vice Chairman |
|
|
BlackRock Growth Partners, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Holdco 2, Inc.
|
|
Vice Chairman |
|
|
BlackRock Institutional Trust Company, National Association,
|
|
Director |
|
|
BlackRock Institutional Trust Company, N.A. - London Branch,
|
|
Director |
|
|
BlackRock Institutional Trust Company, N.A. - Sydney Branch,
|
|
Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Investment Management, LLC,
|
|
Vice Chairman |
|
|
BlackRock Mortgage Ventures, LLC
|
|
Director |
|
|
BlackRock Portfolio Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Portfolio Investments, LLC,
|
|
Vice Chairman |
|
|
DSP BlackRock Investment Managers Private Limited,
|
|
Director |
|
|
State Street Research & Management Company,
|
|
Vice Chairman |
|
|
SSRM Holdings, Inc.,
|
|
Vice Chairman |
Robert Doll, Senior Managing Director |
|
BlackRock, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Advisors, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Capital Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Corporation US, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Financial Management, Inc.,New York, NY |
|
Senior Managing Director |
|
|
BlackRock Fund Advisors,
|
|
Senior Managing Director |
|
|
BlackRock Funding, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Funding International, Ltd.
|
|
Senior Managing Director |
|
|
BlackRock Growth Partners, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Holdco 2, Inc.
|
|
Senior Managing Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Investment Management, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Portfolio Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Portfolio Investments, LLC,
|
|
Senior Managing Director |
|
|
Portfolio Administration & Management Ltd.,
|
|
Director |
|
|
State Street Research & Management Company,
|
|
Senior Managing Director |
|
|
SSRM Holdings, Inc.,
|
|
Senior Managing Director |
Robert Fairbairn, Senior Managing Director |
|
BlackRock, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Advisors, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Capital Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Corporation US, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Financial Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Fund Advisors,
|
|
Senior Managing Director |
|
|
BlackRock Funding, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Funding International, Ltd.
|
|
Senior Managing Director |
|
|
BlackRock Growth Partners, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Investment Management, LLC,Plainsboro, NJ |
|
Senior Managing Director |
|
|
BlackRock Lux Finco S.a r.l.,
|
|
Senior Managing Director |
|
|
BlackRock Operations (Luxembourg) S.a r.l.,
|
|
Senior Managing Director |
|
|
BlackRock Portfolio Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Portfolio Investments, LLC,
|
|
Senior Managing Director |
|
|
BlackRock UK 1 LP,
|
|
Senior Managing Director |
|
|
State Street Research & Management Company,
|
|
Senior Managing Director |
|
|
SSRM Holdings, Inc.,
|
|
Senior Managing Director |
Bennett Golub, Senior Managing Director and Chief Risk Officer |
|
BlackRock, Inc.,
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Advisors, LLC,
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Capital Management, Inc.,
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Corporation US, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Financial Management, Inc.,
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Fund Advisors,
|
|
Senior Managing Director |
|
|
BlackRock Funding, Inc.,
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Funding International, Ltd.
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Growth Partners, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Investment Management, LLC,
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Portfolio Holdings, Inc.
|
|
Senior Managing Director and Chief Risk Officer |
|
|
BlackRock Portfolio Investments, LLC
|
|
Senior Managing Director and Chief Risk Officer |
|
|
SSRM Holdings, Inc.
|
|
Senior Managing Director and Chief Risk Officer |
|
|
State Street Research & Management Company,Boston, MA |
|
Senior Managing Director and Chief Risk Officer |
Richard Kushel, Senior Managing Director |
|
BlackRock, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Advisors, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Asset Management Deutschland AG,
|
|
Chairman and Director |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Capital Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Corporation US, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Financial Management, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Fund Advisors,
|
|
Senior Managing Director |
|
|
BlackRock Funding, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Growth Partners, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Holdco 5, LLC,
|
|
Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Senior Managing Director |
|
|
BlackRock Investment Management, LLC,
|
|
Senior Managing Director |
|
|
BlackRock Japan Co., Ltd
|
|
Director |
|
|
BlackRock Portfolio Holdings, Inc.
|
|
Senior Managing Director |
|
|
BlackRock Portfolio Investments, LLC
|
|
Senior Managing Director |
|
|
SSRM Holdings, Inc.
|
|
Senior Managing Director |
|
|
State Street Research & Management Company,
|
|
Senior Managing Director |
|
|
BlackRock Advisors Singapore Pte. Ltd.,
|
|
Director |
|
|
BlackRock Asset Management UK Limited,
|
|
Chairman and Director |
|
|
BlackRock Group Limited,
|
|
Chairman and Director |
|
|
BlackRock (Hong Kong) Limited,
|
|
Director |
|
|
BlackRock International Limited,
|
|
Chairman and Director |
|
|
BlackRock Investment Management International Limited,London, England |
|
Chairman and Director |
|
|
BlackRock Investment Management (Korea) Limited,
|
|
Director |
|
|
BlackRock Investment Management (Singapore) Limited,
|
|
Director |
|
|
BlackRock Investment Management (UK) Limited,
|
|
Chairman and Director |
|
|
BlackRock (Taiwan) Limited,
|
|
Director |
|
|
DSP BlackRock Investment Managers Private Limited,
|
|
Director |
|
|
PSN Pty Ltd.,
|
|
Director |
Amy Engel, Treasurer and Managing Director |
|
BlackRock, Inc.,
|
|
Treasurer and Managing Director |
|
|
BAA Holdings, LLC,
|
|
Treasurer and Managing Director |
|
|
BlackRock Advisors, LLC,
|
|
Treasurer and Managing Director |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Treasurer and Managing Director |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Treasurer and Managing Director |
|
|
BlackRock Capital Management, Inc.,
|
|
Treasurer and Managing Director |
|
|
BlackRock Financial Management, Inc.,
|
|
Treasurer and Managing Director |
|
|
BlackRock Fund Advisors,
|
|
Treasurer and Managing Director |
|
|
BlackRock Funding International, Ltd.
|
|
Treasurer and Managing Director |
|
|
BlackRock Funding, Inc.,
|
|
Treasurer and Managing Director |
|
|
BlackRock Holdco 2, Inc.,
|
|
Treasurer and Managing Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Treasurer and Managing Director |
|
|
BlackRock Investment Management, LLC,
|
|
Treasurer and Managing Director |
|
|
BlackRock Portfolio Holdings, Inc.
|
|
Treasurer and Managing Director |
|
|
BlackRock Portfolio Investments, LLC
|
|
Treasurer and Managing Director |
|
|
SSRM Holdings, Inc.
|
|
Treasurer and Managing Director |
|
|
State Street Research & Management Company,
|
|
Treasurer and Managing Director |
Blake Grossman, Vice Chairman |
|
BlackRock, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Advisors, LLC,
|
|
Vice Chairman |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Capital Management, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Corporation US, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Financial Management, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Fund Advisors,
|
|
Vice Chairman |
|
|
BlackRock Funding, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Growth Partners, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Institutional Trust Company, National Association,
|
|
Chief Executive Officer, President, and Director |
|
|
BlackRock Institutional Trust Company, N.A. - London Branch,
|
|
Director |
|
|
BlackRock Institutional Trust Company, N.A. - Sydney Branch,
|
|
Director |
|
|
BlackRock International Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Portfolio Holdings, Inc.
|
|
Vice Chairman |
|
|
BlackRock Portfolio Investments, LLC
|
|
Vice Chairman |
Kendrick Wilson, Vice Chairman |
|
BlackRock, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Advisors, LLC,
|
|
Vice Chairman |
|
|
BlackRock Advisors Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Capital Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Capital Management, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Corporation US, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Delaware Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Financial Management, Inc.,New York, NY |
|
Vice Chairman |
|
|
BlackRock Fund Advisors,
|
|
Vice Chairman |
|
|
BlackRock Funding, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Funding International, Ltd.,
|
|
Vice Chairman |
|
|
BlackRock Growth Partners, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Holdco 2, Inc.,
|
|
Vice Chairman |
|
|
BlackRock International Holdings, Inc.,
|
|
Vice Chairman |
|
|
BlackRock Investment Management, LLC,
|
|
Vice Chairman |
|
|
BlackRock Portfolio Holdings, Inc.
|
|
Vice Chairman |
|
|
BlackRock Portfolio Investments, LLC
|
|
Vice Chairman |
|
|
SSRM Holdings, Inc.
|
|
Vice Chairman |
|
|
State Street Research & Management Company,
|
|
Vice Chairman |
|
2. |
Bogle Investment Management, LP: The sole business activity of Bogle Investment Management, LP (Bogle), 2310 Washington Street, Suite 310, Newton Lower Falls, MA 02462, is to serve as an investment adviser. Bogle is registered under the Investment Advisers Act of 1940.
The directors and officers have not held any positions with other companies during the last two fiscal years. |
|
|
|
|
3. |
Schneider Capital Management Company: The sole business activity of Schneider Capital Management Company (Schneider), 460 E. Swedesford Road, Suite 2000, Wayne, PA 19087, is to serve as an investment adviser. Schneider is registered under the Investment Advisers Act of 1940.
Information as to the directors and officers of Schneider is as follows: |
|
|
Name and Position with
|
|
Other Company |
|
Position With Other
|
|
|
|
|
|
|
|
|
|
Arnold C. Schneider, III President and Chief Investment Officer |
|
Turnbridge Management Partners Corp. |
|
President |
|
|
|
|
|
|
|
|
|
Steven J. Fellin Sr. Vice President, Chief Operating & Financial Officer Chief Compliance Officer |
|
Turnbridge Management Partners Corp. |
|
Vice President |
|
4. |
Robeco Investment Management, Inc. The sole business activity of Robeco Investment Management, Inc. (RIM), 909 Third Avenue, New York 10022, is to serve as an investment adviser. RIM provides investment advisory services to the Robeco Boston Partners Funds and the Robeco Weiss, Peck, & Greer Funds.
RIM is registered under the Investment Advisers Act of 1940 and serves as an investment adviser to domestic and foreign institutional investors, investment companies, commingled trust funds, private investment partnerships and collective investment vehicles. Information as to the directors and officers of Robeco Investment Management, Inc. is as follows: |
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Name and Position with RIM |
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Other Company |
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Position With Other
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Mark E. Donovan Senior Managing Director, Co-Chief Executive Officer |
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Robeco Institutional Asset Management US Inc.
Robeco Trust Company
Saint Sebastian High School |
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Director
Co-CEO, Director & Chairman of the Board
Trustee |
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Joseph F. Feeney, Jr. Senior Managing Director, Co-Chief Executive Officer |
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Robeco US Holding, Inc.
Robeco Trust Company |
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Director
President, Co-CEO, Chief Investment Officer, Director & Vice Chairman of the Board |
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William George Butterly, III Senior Managing Director, Chief Operating Officer, General Counsel, Chief Compliance Officer & Secretary |
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Robeco Institutional Assets Management US Inc.
Robeco Securities, L.L.C.
Robeco Trust Company
Sustainable Asset Management USA, Inc. |
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Chief Legal Officer, Chief Compliance Officer & Secretary
Chief Legal Officer
Chief Operating Officer, Secretary & Director
Chief Legal Officer, Chief Compliance Officer & Secretary |
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Matthew J. Davis Senior Managing Director, Treasurer & Chief Financial Officer |
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Robeco Institutional Asset Management US Inc.
Robeco Securities, L.L.C.
Robeco Trust Company |
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President, Treasurer & Director
Chief Legal Officer
Chief Financial Officer, Treasurer & Director |
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Paul F. Healey Senior Managing Director & Director of Sales, Marketing & Client Service |
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Robeco Securities, L.L.C.
Robeco Trust Company
Mellon Capital Management
Investment Committee of the New England Province of Jesuits |
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Chief Executive Officer
Director of Sales & Relationship Management, & Director
Executive Vice President
Member, Former Chairman
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Roderick Munsters Director |
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None |
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None |
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Leni M. Boeren Director |
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None |
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None |
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Hester Borrie
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None |
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None |
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5. |
Bear Stearns Asset Management Inc. Bear Stearns Asset Management Inc. (BSAM) serves as the investment adviser to the Bear Stearns CUFS MLP Mortgage Portfolio. BSAM is located at 245 Park Avenue, New York, New York 10167. BSAM is a registered investment adviser under the Investment Advisers Act of 1940, as amended. BSAMs Form ADV is available on the SECs website.
Information as to the directors and officers of BSAM is as follows: |
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Name and Position with
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Other Company |
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Position With Other Company |
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Lawrence Unrein Director, Chairman of the Board, Chief Executive Officer, President |
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Roger Baumann Director |
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Artisan Advisors LLC |
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CEO/Founder |
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Gregory Quental Director |
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Domus |
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Director |
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6. |
Matson Money, Inc. (formerly known as Abundance Technologies, Inc.): The sole business activity of Matson Money, Inc. (Matson Money), 5955 Deerfield Blvd., Mason, OH 45040, is to serve as an investment adviser. Matson Money is registered under the Investment Advisers Act of 1940.
Below is a list of each executive officer and director of Matson Money indicating each business, profession, vocation or employment of a substantial nature in which each such person has been engaged within the last two years, for his or her own account or in the capacity of director, officer, partner or trustee. |
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Name and Position with
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Name of Other Company |
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Position With Other Company |
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Mark E Matson President/CEO |
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Abundance Horizons LLC Keep It Tight Fitness, LLC |
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50% owner 50% owner |
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Michelle Matson Vice President/ Secretary |
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None |
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None |
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Dan List Chief Compliance Officer |
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None |
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None |
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Craig M. Sullivan Chief Financial Officer |
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7. |
Marvin & Palmer Associates, Inc.: The sole business activity of Marvin & Palmer Associates, Inc., 1201 N. Market Street, Suite 2300, Wilmington, Delaware 19801-1165, is to serve as an investment adviser. Marvin & Palmer Associates is registered under the Investment Advisers Act of 1940.
Below is a list of each executive officer and director of Marvin & Palmer Associates indicating each business, profession, vocation or employment of a substantial nature in which each such person has been engaged within the last two years, for his or her own account or in the capacity of director, officer, partner or trustee. |
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Name and Position with
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Name of Other Company |
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Position With Other Company |
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David F. Marvin Chairman & Chief Executive Officer Director |
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Cash Management Policy Board Office of the State Treasurer 820 Silver Lake Boulevard Suite 100 Dover, Delaware 19901
Wilmington University Board of Trustees 320 DuPont Highway New Castle, Delaware 19720 |
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Board Member
Trustee |
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Stanley Palmer Vice Chairman Director |
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None |
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None |
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Todd D. Marvin President Director |
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Serviam Girls Academy P. O. Box 7907 Wilmington, Delaware 19803 |
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Board Member |
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David L. Schaen President Director |
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None |
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None |
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Karen T. Buckley Chief Operating Officer Chief Financial Officer Director |
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None |
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None |
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The Rt. Hon. Lord Moore, P.C. Director |
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None
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None |
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Madelyn B. Smith Director |
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University of Puget Sound Endowment Committee 1500 North Warner Street Tacoma, Washington 98416
Bellarmine Preparatory School Retirement Board 2300 S. Washington Tacoma, Washington 98405-1399 |
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Committee Member
Trustee of Retirement Fund |
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8. |
Perimeter Capital Management, LLC (Perimeter)
The principal business address of Perimeter is Six Concourse Parkway, Suite 3300, Atlanta, Georgia 30328.
Perimeter serves as the investment adviser for the Perimeter Small Cap Growth Fund. Perimeter is an investment adviser registered under the Investment Advisers Act of 1940. The information as to the directors and officers of Perimeter is as follows: |
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Name and Position with
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Name of Other Company |
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Position With Other Company |
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G. Bradley Ball Managing Partner and CEO Perimeter Capital Management |
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Perimeter Concourse Capital LLC |
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Member, Board of Directors |
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Mark D. Garfinkel, CFA Managing Partner and CIO Perimeter Capital Management |
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Perimeter Concourse Capital LLC |
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Member, Board of Directors |
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Christopher J. Paolella Managing Partner, Director of Marketing & Consultant Relations Perimeter Capital Management |
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Perimeter Concourse Capital LLC |
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Director of Marketing & Consultant Relations |
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Adam C. Stewart, CFA Partner, Director of Trading and Chief Compliance Officer Perimeter Capital Management |
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Perimeter Concourse Capital LLC |
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Director of Trading & CCO |
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Theresa N. Benson Partner, Director of Third-Party Distribution & Consultant Relations Perimeter Capital Management |
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Perimeter Concourse Capital LLC |
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Director of Third-Party Distribution & Client Relations |
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9. |
Simple Alternatives, LLC (SA)
The principal business address of SA is 90 Grove Street, Suite 205, Ridgefield, CT 06877.
SA serves as the investment adviser for the S1 Fund. SA is an investment adviser registered under the Investment Advisers Act of 1940. The information as to the directors and officers of SA is as follows: |
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Name and Position with
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Name of Other Company |
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Position With Other Company |
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James K. Dilworth Partner, Chief Executive Officer
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Dilworth Capital Management, LLC
Dilworth Securities, Inc. |
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President, Chief Compliance Officer |
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Bruce MacDonald Partner, Chief Investment Officer |
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University of Virginia Investment Management Company (UVIMCO) |
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Chairman of the Investment Committee and Director of Asset Allocation & Risk |
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Josh Kernan Partner, Chief Marketing Officer |
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Charles Schwab & Co., Inc |
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Director of Alternative Investments & Managed Accounts |
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PJ Rossi Chief Operating Officer & CFO |
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TH Lee Putnum Ventures, LP |
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Director of Finance & Business Operations |
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Lelia Long Chief Compliance Officer |
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Pemberwick Investment Advisors, LLC |
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Chief Compliance Officer |
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Vigilant Compliance Services |
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Director |
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The New Ireland Fund, Inc. |
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Treasurer |
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Bank of Ireland Asset Management (U.S.) Limited |
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Director & Senior Vice President Client Services |
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10. |
Summit Global Investments, LLC: The sole business activity of Summit Global Investments, LLC (SGI), 189 North, Hwy 89, Suite 144, North Salt Lake, Utah 84054, is to serve as an investment adviser. SGI is registered under the Investment Advisers Act of 1940.
Below is a list of each executive officer and director of SGI indicating each business, profession, vocation or employment of a substantial nature in which each such person has been engaged within the last two years, for his or her own account or in the capacity of director, officer, partner or trustee. |
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Name and Position with
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Name of Other Company |
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Position With Other
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David Harden President, Chief Investment Officer |
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Ensign Peak Advisors, Inc. |
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Vice President |
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Mark Kenison Chief Operating Officer, Chief Compliance Officer |
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Turning Point Financial, Inc.
Turning Point Benefits Group |
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President, Chief Compliance Officer
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Bryce Sutton Partner, Managing Director |
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LC Advisors
Kotak Mahindra, Inc. |
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Vice President
Vice President, Institutional Sales & Marketing |
Item 32 . Principal Underwriter
(a) BNY Mellon Distributors Inc. (the Distributor) is registered with the Securities and Exchange Commission as a broker-dealer and is a member of the FINRA. As of April 26, 2011, the Distributor acted as principal underwriter for the following investment companies:
Aston Funds
E.I.I. Realty Securities Trust
FundVantage Trust
GuideStone Funds
Highland Floating Rate Fund
Highland Floating Rate Advantage Fund
Highland Funds I
Highland Funds II
The Industry Leaders Fund
Kalmar Pooled Investment Trust
Matthews International Funds, dba Matthews Asia Funds
Metropolitan West Funds
The Motley Fool Funds Trust
New Alternatives Funds, Inc.
Old Westbury Funds
The RBB Fund, Inc.
Stratton Multi-Cap Fund, Inc.
Stratton Real Estate Fund, Inc.
The Stratton Funds, Inc.
The Torray Fund
(b) The Distributor is a Massachusetts corporation located at 760 Moore Road, King of Prussia, PA 19406. The Distributor is a wholly-owned subsidiary of BNY Mellon Distributors Holdings Inc. Inc. a wholly-owned subsidiary of The Bank of New York Mellon Corporation, a publicly traded company.
The following is a list of the directors and executive officers of the Distributor:
Board of Directors
Name |
|
Position |
|
Effective Date |
John F. Fulgoney |
|
Director |
|
January 11, 2011 |
Michael DeNofrio |
|
Director |
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April 26, 2007 |
Steven Turowski |
|
Director |
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August 30, 2007 |
Dennis J. Westley |
|
Director |
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March 4, 2008 |
Scott P. LaVasseur |
|
Director |
|
February 16, 2011 |
Officers
Name |
|
Position |
|
Effective Date |
John F. Fulgoney |
|
President and Chief Executive Officer |
|
January 18, 2011 |
Bruno DiStefano |
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Vice President |
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April 11, 2007 |
Susan K. Moscaritolo |
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Vice President, Secretary and Clerk |
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VP - April 11, 2007 Secretary and Clerk May 29, 2007 |
Matthew O. Tierney |
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Treasurer and Financial Operations Principal, Chief Financial Officer |
|
August 19, 2008 |
Felicia Antonio |
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Chief Compliance Officer |
|
August 27, 2010 |
Jodi Jamison |
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Chief Legal Officer |
|
April 11, 2007 |
Ellen C. Krause |
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Chief Risk Officer |
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March 26, 2009 |
Maria C. Schaffer |
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Controller and Assistant Treasurer |
|
April 11, 2007 |
John J. Munera |
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Anti-Money Laundering Officer |
|
April 11, 2007 |
Ronald Berge |
|
Vice President |
|
February 16, 2011 |
Dianna A. Stone |
|
Assistant Secretary and Assistant Clerk |
|
November 27, 2007 |
Kevin D. Peterson |
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Assistant Treasurer Tax |
|
July 1, 2010 |
Gary E. Abbs |
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Assistant Treasurer Tax |
|
July 1, 2010 |
Joanne S. Huber |
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Assistant Treasurer Tax |
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July 1, 2010 |
Barbara J. Parrish |
|
Assistant Secretary |
|
July 1, 2010 |
Mary Lou Olinski |
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Assistant Secretary |
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July 1, 2010 |
Cristina Rice |
|
Assistant Secretary |
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July 1, 2010 |
(c) Not Applicable.
Item 33. LOCATION OF ACCOUNTS AND RECORDS
(1) The Bank of New York Mellon, One Wall Street, New York, New York 10286 (records relating to its functions as sub-adviser and custodian).
(2) BNY Mellon Distributors, Inc., 760 Moore Road, Valley Forge, Pennsylvania 19406. (records relating to its functions as principal underwriter).
(3) BlackRock Advisors, LLC, Bellevue Corporate Center, 100 Bellevue Parkway, Wilmington, Delaware 19809 (records relating to its functions as investment adviser, sub-adviser and administrator).
(4) BNY Mellon Investment Servicing (US) Inc., Bellevue Corporate Center, 103 Bellevue Parkway, Wilmington, Delaware 19809 (records relating to its functions as transfer agent and dividend disbursing agent).
(5) BNY Mellon Investment Servicing (US) Inc., 301 Bellevue Parkway, Wilmington, Delaware 19809 (records relating to its function as administrator and accounting agent and Registrants Articles of Incorporation, By-Laws and Minute books).
(6) Robeco Investment Management, Inc. (formerly Boston Partners Asset Management, L.L.C.), 909 Third Avenue, 32 nd floor, New York, New York 10022 (records relating to its function as investment adviser).
(7) Schneider Capital Management Co., 460 East Swedesford Road, Suite 1080, Wayne, Pennsylvania 19087 (records relating to its function as investment adviser).
(8) Bogle Investment Management, L.P., 2310 Washington Street, Suite 310, Newton Lower Falls, Massachusetts 02462 (records relating to its function as investment adviser).
(9) Robeco Investment Management, Inc. (formerly Weiss, Peck & Greer Investments), 909 Third Avenue, 32nd floor, New York, New York 10022 (records relating to its function as investment adviser).
(10) Bear Stearns & Co. Inc., 245 Park Avenue, New York, New York 10167 (records relating to its function as investment adviser).
(11) Marvin & Palmer Associates, Inc., 1201 N. Market Street, Suite 2300, Wilmington, Delaware 19801-1165 (records relating to its function as investment adviser).
(12) Matson Money, Inc. (formerly Abundance Technologies, Inc.), 5955 Deerfield Blvd., Mason, OH 45040 (records relating to its function as investment adviser).
(13) Perimeter Capital Management, LLC, Five Concourse Parkway Suite 2725 Atlanta, GA 30328 (records relating to its function as investment adviser).
(14) Simple Alternatives, LLC, 25 Burtis Avenue, New Canaan, CT 06840 (records relating to its function as investment adviser).
(15) Summit Global Investments, LLC, 189 North, Hwy 89, Suite 144, North Salt Lake, Utah 84054 (records relating to its function as investment adviser).
Item 34. MANAGEMENT SERVICES
None.
Item 35. UNDERTAKINGS
(a) Registrant hereby undertakes to hold a meeting of shareholders for the purpose of considering the removal of directors in the event the requisite number of shareholders so request.
(b) Registrant hereby undertakes to furnish each person to whom a prospectus is delivered a copy of Registrants latest annual report to shareholders upon request and without charge.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended (the 1933 Act), and the Investment Company Act of 1940, as amended, the Registrant certifies that it has duly caused this Post-Effective Amendment No. 144 to its Registration Statement to be signed on its behalf by the undersigned, thereto duly authorized, in the City of Wilmington, and State of Delaware on the 15 th day of December, 2011.
|
THE RBB FUND, INC. |
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By: |
/s/ Salvatore Faia |
|
Salvatore Faia |
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|
President |
Pursuant to the requirements of the 1933 Act, this Post-Effective Amendment to Registrants Registration Statement has been signed below by the following persons in the capacities and on the date indicated.
SIGNATURE |
|
TITLE |
|
DATE |
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/s/ Salvatore Faia |
|
President (Principal Executive Officer) and Chief Compliance Officer |
|
December 15, 2011 |
|
Salvatore Faia |
|
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/s/ Joel L. Weiss |
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Treasurer (Chief Financial Officer) |
|
December 15, 2011 |
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Joel L. Weiss |
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*J. Richard Carnall |
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Director |
|
December 15, 2011 |
|
J. Richard Carnall |
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*Francis J. McKay |
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Director |
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December 15, 2011 |
|
Francis J. McKay |
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*Julian A. Brodsky |
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Director |
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December 15, 2011 |
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Julian A. Brodsky |
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*Arnold M. Reichman |
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Director |
|
December 15, 2011 |
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Arnold M. Reichman |
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*Robert Sablowsky |
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Director |
|
December 15, 2011 |
|
Robert Sablowsky |
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*Robert Straniere |
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Director |
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December 15, 2011 |
|
Robert Straniere |
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|
*Nicholas A. Giordano |
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Director |
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December 15, 2011 |
|
Nicholas A. Giordano |
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*By: |
/s/ Salvatore Faia |
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December 15, 2011 |
Salvatore Faia |
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Attorney-in-Fact |
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THE RBB FUND, INC.
(the Company)
POWER OF ATTORNEY
Know All Men by These Presents, that the undersigned, Julian A. Brodsky, hereby constitutes and appoints Salvatore Faia, Michael P. Malloy, James G. Shaw and Joel L. Weiss, 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: |
May 7, 2009 |
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/s/ Julian A. Brodsky |
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|
Julian A. Brodsky |
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THE RBB FUND, INC.
(the Company)
POWER OF ATTORNEY
Know All Men by These Presents, that the undersigned, J. Richard Carnall, hereby constitutes and appoints Salvatore Faia, Michael P. Malloy, James G. Shaw and Joel L. Weiss, 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: |
May 7, 2009 |
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/s/ J. Richard Carnall |
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|
J. Richard Carnall |
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THE RBB FUND, INC.
(the Company)
POWER OF ATTORNEY
Know All Men by These Presents, that the undersigned, Nicholas A. Giordano, hereby constitutes and appoints Salvatore Faia, Michael P. Malloy, James G. Shaw and Joel L. Weiss, 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: |
May 7, 2009 |
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/s/ Nicholas A. Giordano |
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|
Nicholas A. Giordano |
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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 Salvatore Faia, Michael P. Malloy, James G. Shaw and Joel L. Weiss, 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: |
May 7, 2009 |
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/s/ Francis J. McKay |
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|
Francis J. McKay |
|
THE RBB FUND, INC.
(the Company)
POWER OF ATTORNEY
Know All Men by These Presents, that the undersigned, Arnold M. Reichman, hereby constitutes and appoints Salvatore Faia, Michael P. Malloy, James G. Shaw and Joel L. Weiss, 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: |
May 7, 2009 |
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|
/s/ Arnold M. Reichman |
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|
Arnold M. Reichman |
|
THE RBB FUND, INC.
(the Company)
POWER OF ATTORNEY
Know All Men by These Presents, that the undersigned, Robert Sablowsky, hereby constitutes and appoints Salvatore Faia, Michael P. Malloy, James G. Shaw and Joel L. Weiss, 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: |
May 7, 2009 |
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/s/ Robert Sablowsky |
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|
Robert Sablowsky |
|
THE RBB FUND, INC.
(the Company)
POWER OF ATTORNEY
Know All Men by These Presents, that the undersigned, Robert Straniere, hereby constitutes and appoints Salvatore Faia, Michael P. Malloy, James G. Shaw and Joel L. Weiss, 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: |
May 7, 2009 |
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/s/ Robert Straniere |
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Robert Straniere |
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PEA 144
EXHIBIT INDEX
EXHIBIT |
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DESCRIPTION |
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(a)(61) |
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Articles Supplementary of Registrant ( Summit Global Investments U.S. Low Volatility Equity Fund ) |
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(d)(36) |
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Form of Investment Advisory Agreement ( Summit Global Investments U.S. Low Volatility Equity Fund ) |
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(d)(37) |
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Form of Contractual Fee Waiver Agreement ( Summit Global Investments U.S. Low Volatility Equity Fund ) |
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(l)(24) |
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Form of Purchase Agreement ( Summit Global Investments U.S. Low Volatility Equity Fund ) |
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(m)(14) |
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Plan of Distribution pursuant to Rule 12b-1 ( Summit Global Investments U.S. Low Volatility Equity Fund Retail Class) |
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(m)(15) |
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Plan of Distribution pursuant to Rule 12b-1 ( Summit Global Investments U.S. Low Volatility Equity Fund Class A) |
Exhibit 99.(a)(61)
THE RBB FUND, INC.
ARTICLES SUPPLEMENTARY
THE RBB FUND, INC., a Maryland corporation having its principal office in Baltimore, Maryland (hereinafter called the Corporation), hereby certifies to the State Department of Assessments and Taxation of Maryland that:
FIRST: In accordance with the requirements of Section 2-208 of the Maryland General Corporation Law, the Board of Directors of the Corporation has classified: 1) One Hundred Million (100,000,000) authorized but unclassified and unissued shares of Common Stock of the Corporation as Class GGGGG shares of Common Stock representing interests in the Summit Global Investments Low Volatility Fund Class A; and 2) One Hundred Million (100,000,000) authorized but unclassified and unissued shares of Common Stock of the Corporation as Class HHHHH shares of Common Stock representing interests in the Summit Global Investments Low Volatility Fund Class I; and 3) One Hundred Million (100,000,000) authorized but unclassified and unissued shares of Common Stock of the Corporation as Class IIIII shares of Common Stock representing interests in the Summit Global Investments Low Volatility Fund Retail Class, pursuant to the following resolutions adopted by the Board of Directors of the Corporation on September 13, 2011:
RESOLVED, that pursuant to the authority expressly given to the Board of Directors in Article VI, Section (4) of the Corporations Charter, the Board hereby classifies authorized and unissued shares of Common Stock of the Corporation, par value $.001 per share, and hereby fixes and determines the rights, preferences, restrictions and other matters relating to such classes of Common Stock as follows:
1. Class GGGGG Shares . One Hundred Million (100,000,000) of the authorized, unissued and unclassified shares of the Corporation (par value $.001 per share) are hereby classified and designated as Class GGGGG shares of Common Stock representing interests in the Summit Global Investments Low Volatility Fund Class A.
2. Class HHHHH Shares . One Hundred Million (100,000,000) of the authorized, unissued and unclassified shares of the Corporation (par value $.001 per share) are hereby classified and designated as Class HHHHH shares of Common Stock representing interests in the Summit Global Investments Low Volatility Fund Class I.
3. Class IIIII Shares . One Hundred Million (100,000,000) of the authorized, unissued and unclassified shares of the Corporation (par value $.001 per share) are hereby classified and designated as Class IIIII shares of Common Stock
representing interests in the Summit Global Investments Low Volatility Fund Retail Class.
FURTHER RESOLVED, that a description of the shares so classified with the preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends, qualifications and terms and conditions of redemption as set or changed by the Board of Directors of the Corporation is as set forth in Article VI, Section (6) of the Corporations Articles of Incorporation and as set forth elsewhere in the Charter of the Corporation with respect to stock of the Corporation generally, and as follows:
1. To the full extent permitted by applicable law, the Corporation may, without the vote of the shares of any class of capital stock of the Corporation then outstanding and if so determined by the Board of Directors:
(A)(1) sell and convey the assets belonging to Class GGGGG, Class HHHHH or Class IIIII, Common Stock (each a Class) to another trust or corporation that is a management investment company (as defined in the Investment Company Act of 1940, as amended) and is organized under the laws of any state of the United States for consideration, which may include the assumption of all outstanding obligations, taxes and other liabilities, accrued or contingent, belonging to such Class and which may include securities issued by such trust or corporation. Following such sale and conveyance, and after making provision for the payment of any liabilities belonging to such Class that are not assumed by the purchaser of the assets belonging to such Class, the Corporation may, at its option, redeem all outstanding shares of such Class at the net asset value thereof as determined by the Board of Directors in accordance with the provisions of applicable law, less such redemption fee or other charge, if any, as may be fixed by resolution of the Board of Directors. Notwithstanding any other provision of the Charter of the Corporation to the contrary, the redemption price may be paid in any combination of cash or other assets belonging to such Class, including but not limited to the distribution of the securities or other consideration received by the Corporation for the assets belonging to such Class upon such conditions as the Board of Directors deems, in its sole discretion, to be appropriate and consistent with applicable law and the Charter of the Corporation;
(2) sell and convert the assets belonging to a Class into money and, after making provision for the payment of all obligations, taxes and other liabilities, accrued or contingent, belonging to such Class, the Corporation may, at its option, redeem all outstanding shares of such Class at the net asset value thereof as determined by the Board of Directors in accordance with the provisions of applicable law, less such redemption fee or other charge, if any, as may be fixed by resolution of the Board of Directors upon such conditions as the Board of Directors deems, in its sole discretion, to be appropriate and consistent with applicable law and the Charter of the Corporation; or
(3) combine the assets belonging to a Class with the assets belonging to any one or more other classes of capital stock of the Corporation if the Board of Directors reasonably determines that such combination will not have a material adverse effect on the stockholders of any class of capital stock of the Corporation
participating in such combination. In connection with any such combination of assets, the shares of the Class then outstanding may, if so determined by the Board of Directors, be converted into shares of any other class or classes of capital stock of the Corporation with respect to which conversion is permitted by applicable law, or may be redeemed, at the option of the Corporation, at the net asset value thereof as determined by the Board of Directors in accordance with the provisions of applicable law, less such redemption fee or other charge, or conversion cost, if any, as may be fixed by resolution of the Board of Directors upon such conditions as the Board of Directors deems, in its sole discretion, to be appropriate and consistent with applicable law and the Charter of the Corporation. Notwithstanding any other provision of these Articles Supplementary or the Articles of Incorporation to the contrary, any redemption price, or part thereof, paid pursuant to this section may be paid in shares of any other existing or future class or classes of capital stock of the Corporation; and
(B) without limiting the foregoing, at its option, redeem shares of the Classes for any other reason if the Board of Directors has determined that it is in the best interest of the Corporation to do so. Any such redemption shall be at the net asset value of such shares of such Class being redeemed less such redemption fee or other charge, if any, as may be fixed by resolution of the Board of Directors and shall be made and effective upon such terms and in accordance with procedures approved by the Board of Directors at such time.
2. The shares of Class GGGGG Common Stock, Class HHHHH Common Stock and Class IIIII Common Stock will be issued without stock certificates.
SECOND: The shares aforesaid have been duly classified by the Board of Directors of the Corporation pursuant to authority and power contained in the Charter of the Corporation.
THIRD: (1) Immediately before the classification of additional authorized, unissued and unclassified shares of Common Stock as Class GGGGG Common Stock, Class HHHHH Common Stock and Class IIIII Common Stock:
(a) the Corporation had the authority to issue one hundred billion (100,000,000,000) shares of its Common Stock and the aggregate par value of all the shares of all classes was one hundred million dollars ($100,000,000); and
Class E |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class F |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class G |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class H |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class I |
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- |
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one billion five hundred million (1,500,000,000), par value $.001 per share; |
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Class J |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class K |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class L |
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- |
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one billion five hundred million (1,500,000,000), par value $.001 per share; |
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Class M |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class N |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class O |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class P |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class Q |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class R |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class S |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class T |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class U |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class V |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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Class W |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class X |
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- |
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fifty million (50,000,000), par value $.001 per share; |
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Class Y |
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- |
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fifty million (50,000,000), par value $.001 per share; |
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Class Z |
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- |
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fifty million (50,000,000), par value $.001 per share; |
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Class AA |
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- |
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fifty million (50,000,000), par value $.001 per share; |
Class BB |
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- |
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fifty million (50,000,000), par value $.001 per share; |
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Class CC |
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- |
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fifty million (50,000,000), par value $.001 per share; |
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Class DD |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class EE |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class FF |
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- |
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fifty million (50,000,000), par value $.001 per share; |
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Class GG |
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- |
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fifty million (50,000,000), par value $.001 per share; |
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Class HH |
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- |
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fifty million (50,000,000), par value $.001 per share; |
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Class II |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class JJ |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class KK |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class LL |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class MM |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class NN |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class OO |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class PP |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class QQ |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class RR |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class SS |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class TT |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class UU |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class VV |
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one hundred million (100,000,000), par value $.001 per share; |
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Class WW |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class YY |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class ZZ |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
Class AAA |
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one hundred million (100,000,000), par value $.001 per share; |
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Class BBB |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class CCC |
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one hundred million (100,000,000), par value $.001 per share; |
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Class DDD |
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one hundred million (100,000,000), par value $.001 per share; |
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Class EEE |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class FFF |
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one hundred million (100,000,000), par value $.001 per share; |
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Class GGG |
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one hundred million (100,000,000), par value $.001 per share; |
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Class HHH |
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one hundred million (100,000,000), par value $.001 per share; |
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Class III |
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one hundred million (100,000,000), par value $.001 per share; |
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Class JJJ |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class KKK |
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one hundred million (100,000,000), par value $.001 per share; |
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Class LLL |
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one hundred million (100,000,000), par value $.001 per share; |
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Class MMM |
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one hundred million (100,000,000), par value $.001 per share; |
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Class NNN |
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one hundred million (100,000,000), par value $.001 per share; |
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Class OOO |
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one hundred million (100,000,000), par value $.001 per share; |
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Class PPP |
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one hundred million (100,000,000), par value $.001 per share; |
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Class QQQ |
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two billion five hundred million (2,500,000,000), par value $.001 per share; |
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Class RRR |
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two billion five hundred million (2,500,000,000), par value $.001 per share; |
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Class SSS |
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one hundred million (100,000,000), par value $.001 per share; |
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Class TTT |
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fifty million (50,000,000), par value $.001 per share; |
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Class UUU |
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fifty million (50,000,000), par value $.001 per share; |
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Class VVV |
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fifty million (50,000,000), par value $.001 per share; |
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Class WWW |
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fifty million (50,000,000), par value $.001 per share; |
Class VVVV |
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one hundred million (100,000,000), par value $.001 per share; |
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Class WWWW |
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one hundred million (100,000,000), par value $.001 per share; |
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Class XXXX |
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one hundred million (100,000,000), par value $.001 per share; |
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Class YYYY |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class ZZZZ |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class AAAAA |
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one hundred million (100,000,000), par value $.001 per share; |
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Class BBBBB |
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one hundred million (100,000,000), par value $.001 per share; |
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Class CCCCC |
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one hundred million (100,000,000), par value $.001 per share; |
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Class DDDDD |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class EEEEE |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class FFFFF |
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one hundred million (100,000,000), par value $.001 per share; |
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Class Select |
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seven hundred million (700,000,000), par value $.001 per share; |
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Class Beta 2 |
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one million (1,000,000), par value $.001 per share; |
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Class Beta 3 |
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one million (1,000,000), par value $.001 per share; |
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Class Beta 4 |
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one million (1,000,000), par value $.001 per share; |
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Class Principal Money |
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seven hundred million (700,000,000), par value $.001 per share; |
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Class Gamma 2 |
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one million (1,000,000), par value $.001 per share; |
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Class Gamma 3 |
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one million (1,000,000), par value $.001 per share; |
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Class Gamma 4 |
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one million (1,000,000), par value $.001 per share; |
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Class Bear Stearns |
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Money |
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two billion five hundred million (2,500,000,000), par value $.001 per share; |
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Class Bear Stearns |
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Municipal Money |
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one billion five hundred million (1,500,000,000), par value $.001 per share; |
Class Bear Stearns |
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Government Money |
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- |
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one billion (1,000,000,000), par value $.001 per share; |
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Class Delta 4 |
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one million (1,000,000), par value $.001 per share; |
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Class Epsilon 1 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Epsilon 2 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Epsilon 3 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Epsilon 4 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Zeta 1 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Zeta 2 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Zeta 3 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Zeta 4 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Eta 1 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Eta 2 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Eta 3 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Eta 4 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Theta 1 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Theta 2 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Theta 3 |
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- |
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one million (1,000,000), par value $.001 per share; |
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Class Theta 4 |
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- |
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one million (1,000,000), par value $.001 per share; |
for a total of seventy-nine billion, seven hundred seventy-three million (79,773,000,000) shares classified into separate classes of Common Stock.
(2) After the classification of additional authorized, unissued and unclassified shares of Common Stock as Class GGGGG, Class HHHHH and Class IIIII Common Stock:
(a) the Corporation has the authority to issue one hundred billion (100,000,000,000) shares of its Common Stock and the aggregate par value of all the shares of all classes is one hundred million dollars ($100,000,000); and
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(b) |
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the number of authorized shares of each class is now as follows: |
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Class A |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class B |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class C |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class D |
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- |
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one hundred million (100,000,000), par value $.001 per share; |
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Class E |
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- |
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five hundred million (500,000,000), par value $.001 per share; |
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|
|
|
|
Class F |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class G |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class H |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class I |
|
- |
|
one billion five hundred million (1,500,000,000), par value $.001 per share; |
|
|
|
|
|
Class J |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class K |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class L |
|
- |
|
one billion five hundred million (1,500,000,000), par value $.001 per share; |
|
|
|
|
|
Class M |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class N |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class O |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class P |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class Q |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class R |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class S |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class T |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class U |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
|
|
|
|
|
Class V |
|
- |
|
five hundred million (500,000,000), par value $.001 per share; |
Class UU |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class VV |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class WW |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class YY |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class ZZ |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class AAA |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class BBB |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class CCC |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class DDD |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class EEE |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class FFF |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class GGG |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class HHH |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class III |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class JJJ |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class KKK |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class LLL |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class MMM |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class NNN |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class OOO |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class PPP |
|
- |
|
one hundred million (100,000,000), par value $.001 per share; |
|
|
|
|
|
Class QQQ |
|
- |
|
two billion five hundred million (2,500,000,000), par value $.001 per share; |
|
|
|
|
|
Class RRR |
|
- |
|
two billion five hundred million (2,500,000,000), par value $.001 per share; |
Class Principal Money |
|
|
seven hundred million (700,000,000), par value $.001 per share; |
|
|
|
|
|
|
Class Gamma 2 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Gamma 3 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Gamma 4 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Bear Stearns |
|
|
|
|
Money |
|
- |
|
two billion five hundred million (2,500,000,000), par value $.001 per share; |
|
|
|
|
|
Class Bear Stearns |
|
|
|
|
Municipal Money |
|
- |
|
one billion five hundred million (1,500,000,000), par value $.001 per share; |
|
|
|
|
|
Class Bear Stearns |
|
|
|
|
Government Money |
|
- |
|
one billion (1,000,000,000), par value $.001 per share; |
|
|
|
|
|
Class Delta 4 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Epsilon 1 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Epsilon 2 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Epsilon 3 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Epsilon 4 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Zeta 1 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Zeta 2 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Zeta 3 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Zeta 4 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Eta 1 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Eta 2 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Eta 3 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Eta 4 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Theta 1 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
Class Theta 2 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Theta 3 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
|
|
|
|
|
Class Theta 4 |
|
- |
|
one million (1,000,000), par value $.001 per share; |
for a total of eighty billion, seventy-three million (80,073,000,000) shares classified into separate classes of Common Stock.
IN WITNESS WHEREOF, The RBB Fund, Inc. has caused these presents to be signed in its name and on its behalf by its President and witnessed by its Secretary on the 29 th day of November, 2011.
WITNESS: |
|
THE RBB FUND, INC. |
||
|
|
|
||
|
|
|
||
By: |
/s/ Jennifer Rogers |
|
By: |
/s/ Salvatore Faia |
|
Jennifer Rogers |
|
Salvatore Faia |
|
|
Secretary |
|
President |
CERTIFICATE
THE UNDERSIGNED, President of The RBB Fund, Inc., who executed on behalf of said Corporation the foregoing Articles Supplementary to the Charter, of which this certificate is made a part, hereby acknowledges that the foregoing Articles Supplementary are the act of the said Corporation and further certifies that, to the best of his knowledge, information and belief, the matters and facts set forth therein with respect to the approval thereof are true in all material respects, under the penalties of perjury.
|
/s/ Salvatore Faia |
|
Salvatore Faia |
|
President |
Exhibit 99.(d)(36)
INVESTMENT ADVISORY AGREEMENT
Summit Global Investments U.S. Low Volatility Equity Fund
AGREEMENT made as of between THE RBB FUND, INC., a Maryland corporation (herein called the Fund), and Summit Global Investments, LLC, a Utah limited liability company (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 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 Funds Summit Global Investments U.S. Low Volatility Equity Fund (the Portfolio), and the Investment Adviser is willing to so render such services; and
WHEREAS, the Board of Directors of the Fund and the sole shareholder of the Portfolio have approved this Agreement, and the Investment Adviser is willing to furnish such services upon the terms and conditions herein set forth;
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:
SECTION 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.
SECTION 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; and
(b) A prospectus and statement of additional information relating to each class of shares representing interests in the Portfolio of the Fund in effect under the Securities Act of 1933 (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 Funds 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.
SECTION 3. MANAGEMENT.
(a ) Subject to the supervision of the Board of Directors of the Fund and subject to Section 3 (b) below, 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 the securities and other investments to 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 Portfolios investment objective, restrictions and policies as stated in the applicable Prospectus and 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 Adviser further agrees that it will render to the Funds 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 Portfolios transactions and, where not otherwise available, the daily valuation of securities in the Portfolio.
(b) Sub-Advisers. The Investment Adviser may delegate certain of its responsibilities hereunder with respect to provision of the investment advisory services set forth in Section 3(a) above to one or more other parties (each such party, a Sub-Adviser), pursuant in each case to a written agreement with such Sub-Adviser that meets the requirements of Section 15 of the 1940 Act and rules thereunder applicable to contracts for service as investment adviser of a registered investment company (including without limitation the requirements for approval by the Board of Directors of the Fund and the shareholders of the Portfolio), subject, however, to such exemptions as may be granted by the U.S. Securities and Exchange Commission upon application or by rule. Such Sub-Adviser may (but need not) be affiliated with the Investment Adviser.
Any delegation of services pursuant to this Section 3(b) shall be subject to the following conditions:
1. Any fees or compensation payable to any Sub-Adviser shall be paid by the Investment Adviser and no additional obligation may be incurred on the Funds behalf to any Sub-Adviser; except that any Fund expenses that may be incurred by the Investment Adviser and paid by the Fund to the Investment Adviser directly may be incurred by the Sub-Adviser and paid by the Fund to the Sub-Adviser directly, so long as such payment arrangements are approved by the Fund and the Investment Adviser prior to the Sub-Advisers incurring such expenses.
2. If the Investment Adviser delegates its responsibilities to more than one Sub-Adviser, the Investment Adviser shall be responsible for assigning to each Sub-
Adviser that portion of the assets of the Portfolio for which the Sub-Adviser is to act as Sub-Adviser, subject to the approval of the Funds Board of Directors.
3. To the extent that any obligations of the Investment Adviser or any Sub-Adviser require any service provider of the Fund or Portfolio to furnish information or services, such information or services shall be furnished by the Funds or the Portfolios service providers directly to both the Investment Adviser and any Sub-Adviser.
SECTION 4. BROKERAGE. Subject to the Investment Advisers obligation to obtain best price and execution, 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 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 Advisers 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 Portfolios securities be purchased from or sold to the Funds 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 Investment Adviser to the Fund and the Investment Advisers 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.
SECTION 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 with respect to clients of the Investment Adviser) 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. Where the Investment Adviser may be exposed to civil or criminal contempt proceedings for failure to comply with a request for records or other information relating to the Fund, the Investment Adviser may comply with such request prior to obtaining the Funds written approval, provided that the Investment Adviser has taken reasonable steps to promptly notify the Fund, in writing, upon receipt of the request.
SECTION 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 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 directors, 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 directors, 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 directors, 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 Section 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 Section 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 Section 6 shall be interpreted consistent with the provisions of Section 17(i) of the 1940 Act.
SECTION 7. BOOKS AND RECORDS. In compliance with the requirements of Rule 3la-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 Funds request. The Investment Adviser further agrees to preserve for the periods prescribed by Rule 3la-2 under the 1940 Act the records required to be maintained by Rule 3la-1 under the 1940 Act.
SECTION 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 an investment portfolio of the Fund shall be allocated among all investment portfolios by or under the direction of the Funds 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 Portfolios 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) filing fees and expenses relating to the registration and qualification of the Fund and the Portfolios shares under federal and/or state securities laws and maintaining such registrations and qualifications; (d) fees and salaries payable to the Funds directors and officers; (e) taxes (including any income or franchise taxes) and governmental fees; (f) costs of any liability and other insurance or fidelity bonds; (g) any costs, expenses or losses arising out of a liability of or claim for damages or other relief asserted against the Fund or the Portfolio for violation of any law; (h) legal, accounting and auditing expenses, including legal fees of special counsel for the independent directors; (i) charges of custodians and other agents; (j) expenses of setting in type and printing prospectuses, statements of additional information and supplements thereto for existing shareholders, reports, statements, and confirmations to shareholders and proxy materials 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 materials 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 the Portfolios 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 preparing, 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 Portfolio are allocated to such class.
SECTION 9. VOTING. The Investment Adviser shall have the authority to vote as agent for the Portfolio, either in person or by proxy, tender and take all actions incident to the ownership of all securities in which the Portfolios 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.
SECTION 10. RESERVATION OF NAME. The Investment Adviser shall at all times have all rights in and to the Portfolios name and all investment models used by or on behalf of the Portfolio. The Investment Adviser may use the Portfolios 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. The Fund hereby agrees that in the event that neither the Investment Adviser nor any of its affiliates acts as investment adviser to the Portfolio, the name of the Portfolio will be changed to one that does not suggest an affiliation with the Investment Adviser.
SECTION 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 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 0.70% of the Portfolios average daily net assets. For any period less than a full month during which this Agreement is in effect, the fee shall be prorated according to the proportion which such period bears to a full month.
(b) The fee attributable to the Portfolio shall be satisfied only against the assets of the Portfolio and not against the assets of any other investment portfolio of the Fund. The Investment Adviser may from time to time agree not to impose all or a portion of its fee otherwise payable hereunder (in advance of the time such fee or portion thereof would otherwise accrue) and/or undertake to pay or reimburse the Portfolio for all or a portion of its expenses not otherwise required to be borne or reimbursed by the Investment Adviser.
SECTION 12. LIMITATION OF LIABILITY. 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 Fund 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 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 Section 12 shall not be applicable to any losses, claims, damages, liabilities or expenses arising from the Investment Advisers rights to the Portfolios name. [The Investment Adviser shall indemnify and hold harmless the Fund and the Portfolio for any claims arising from the use of the term Summit Global Investments in the name of the Portfolio.]
SECTION 13. DURATION AND TERMINATION. This Agreement shall become effective with respect to the Portfolio as of the date first above written and, unless sooner terminated as provided herein, shall continue with respect to the Portfolio until August 16, 2013. 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).
SECTION 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, unless otherwise permitted by the 1940 Act, 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.
SECTION 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.
SECTION 16. NOTICE. All notices hereunder shall be given in writing and delivered by hand, national overnight courier, facsimile (provided written confirmation of receipt is obtained and said notice is sent via first class mail on the next business day) or mailed by certified mail, return receipt requested, as follows:
If to the Fund:
The RBB Fund, Inc
Bellevue Corporate Center
301 Bellevue Parkway
Wilmington, DE 19809
Attention: Salvatore Faia
Fax: 302-791-4830
If to the Investment Adviser:
Summit Global Investments
189 North, Hwy 89, Suite 144
North Salt Lake, Utah 84054
Attention: [ ]
Fax: [ ]
The effective date of any notice shall be (i) the date such notice is sent if such delivery is effected by hand or facsimile, (ii) one business day after the date such notice is sent if such delivery is effected by national overnight courier; or (iii) the fifth (5 th ) Business Day after the date of mailing thereof.
SECTION 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.
SECTION 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.
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SUMMIT GLOBAL INVESTMENTS, LLC |
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Exhibit 99.(d)(37)
Form of Contractual Fee Waiver Agreement
[Summit Global Investments, LLC Letterhead]
, 20
Salvatore Faia
President
The RBB Fund, Inc.
Bellevue Park Corporate Center
103 Bellevue Parkway
Wilmington, DE 19809
Re: Summit Global Investments U.S. Low Volatility Equity Fund
Dear Mr. Faia:
By our execution of this letter agreement (the Agreement), intending to be legally bound hereby and effective as of the date noted above, Summit Global Investments, LLC (Summit) agrees that in order to maintain the established expense ratio of the Summit Global Investments U.S. Low Volatility Equity Fund (the Fund), of The RBB Fund, Inc., Summit shall, until further notice, but in no event terminating before , 2013, waive all or a portion of its investment advisory fees and/or reimburse expenses (other than acquired fund fees and expenses, short sale dividend expenses, brokerage commissions, extraordinary items, interest, taxes and any other items as agreed upon by both parties from time to time) in an aggregate amount equal to the amount by which the Funds total annual fund operating expenses for each of its Class A, Class I and Retail Class Shares (other than acquired fund fees and expenses, short sale dividend expenses, brokerage commissions, extraordinary items, interest, taxes and any other items as agreed upon by both parties from time to time) exceeds a total annual fund operating expense ratio (other than acquired fund fees and expenses, short sale dividend expenses, brokerage commissions, extraordinary items, interest, taxes and any other items as agreed upon by both parties from time to time) of:
· 1.23% of the of the average daily net assets attributable to the Funds Class A Shares;
· 0.98% of the of the average daily net assets attributable to the Funds Class I Shares; and
· 1.23% of the of the average daily net assets attributable to the Funds Retail Class Shares.
The Adviser acknowledges that (1) it shall not be entitled to collect on or make a claim for waived fees at any time in the future, and (2) it shall not be entitled to collect on or make a claim for reimbursed Fund expenses at any time in the future.
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Exhibit 99.(l)(24)
PURCHASE AGREEMENT
The RBB Fund, Inc. (the Company), a Maryland corporation, and Summit Global Investments, LLC (Summit), intending to be legally bound, hereby agree with each other as follows:
1. The Company hereby offers Summit and Summit hereby purchases $ worth of shares of Class GGGGG Common Stock (par value $.001 per share), $ worth of shares of Class HHHHH Common Stock (par value $.001 per share) and $ worth of shares of Class IIIII Common Stock (par value $.001 per share) (such shares hereinafter sometimes collectively known as Shares) at price per Share equivalent to the net asset value per share of the Shares as determined on .
2. The Company hereby acknowledges receipt from Summit of funds in the amount of $ in full payment for the Shares.
3. Summit represents and warrants to the Company 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 day of .
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Exhibit 99.(m)(14)
THE RBB FUND, INC.
DISTRIBUTION PLAN
for Retail Class Shares of the
Summit Global Investments U.S. Low Volatility Equity Fund
WHEREAS, The RBB Fund, Inc. (the Company) is engaged in business as an open-end investment company registered under the Investment Company Act of 1940, as amended (the 1940 Act); and
WHEREAS, the Directors of the Company have determined that there is a reasonable likelihood that the following Distribution Plan will benefit the Company and the holders of Retail Class Shares of the Summit Global Investments U.S. Low Volatility Equity Fund (the Fund);
NOW, THEREFORE, the Directors of the Company hereby adopt this Distribution Plan pursuant to Rule 12b-1 under the 1940 Act.
SECTION 1. The Company has adopted this Distribution Plan (the Plan) to enable the Company to directly or indirectly bear expenses relating to the distribution of Retail Class Shares of the Fund.
SECTION 2. The Company will pay the distributor of Retail Class Shares of the Fund a fee at the annual rate of 0.25% of the Funds average daily net assets attributable to Retail Class Shares. The distributor may retain all or part of this fee as compensation for distribution or shareholder services it provides or it may use such fees for compensation of broker/dealers and other financial institutions and intermediaries that provide distribution or shareholder services as specified by the distributor. The actual fee to be paid by the distributor to broker/dealers and financial institutions and intermediaries will be negotiated based on the extent and quality of services provided.
SECTION 3. This Plan shall not take effect until it has been approved (a) by a vote of at least a majority of the outstanding Retail Class Shares of the Fund; and (b) together with any related agreements, by votes of the majority of both (i) the Directors of the Company and (ii) the Qualified Directors (as defined herein), cast in person at a Board of Directors meeting called for the purpose of voting on this Plan or such agreement.
SECTION 4. This Plan shall continue in effect for a period of more than one year after it takes effect only for so long as such continuance is specifically approved at least annually in the manner provided in Part (b) of Section 3 herein for the approval of this Plan.
SECTION 5. Any person authorized to direct the disposition of monies paid or payable by the Company pursuant to this Plan or any related agreement shall provide to the Directors of the Company, at least quarterly, a written report of the amounts so expended and the purposes for which such expenditures were made.
SECTION 6. This Plan may be terminated at any time by the vote of a majority of the Qualified Directors or by vote of a majority of the outstanding Retail Class Shares of the Fund.
SECTION 7. All agreements with any person relating to implementation of this Plan shall be in writing, and any agreement related to this Plan shall provide (a) that such agreement may be terminated at any time, without payment of any penalty, by the vote of a majority of the Qualified Directors or by vote of a majority of the outstanding Retail Class Shares of the Fund, on not more than 60 days written notice to any other party to the agreement; and (b) that such agreement shall terminate automatically in the event of its assignment.
SECTION 8. This Plan may be amended in the manner provided in Part (b) of Section 3 herein for the approval of this Plan; provided, however, that the Plan may not be amended to increase materially the amount of distribution expenses permitted pursuant to Section 2 hereof without the approval of a majority of the outstanding Retail Class Shares of the Fund.
SECTION 9. While this Plan is in effect, the selection and nomination of those Directors who are not interested persons of the Company shall be committed to the discretion of the Directors then in office who are not interested persons of the Company.
SECTION 10. As used in this Plan, (a) the term Qualified Directors shall mean those Directors who are not interested persons of the Company, and have no direct or indirect financial interest in the operation of this Plan or any agreements related to it, and (b) the terms assignment and interested person shall have the respective meanings specified in the 1940 Act and the rules and regulations thereunder, subject to such exemptions as may be granted by the Securities and Exchange Commission.
SECTION 11. This Plan shall not obligate the Company or any other party to enter into an agreement with any particular person.
Adopted: December 8, 2011
Exhibit 99.(m)(15)
THE RBB FUND, INC.
DISTRIBUTION PLAN
for Class A Shares of the
Summit Global Investments U.S. Low Volatility Equity Fund
WHEREAS, The RBB Fund, Inc. (the Company) is engaged in business as an open-end investment company registered under the Investment Company Act of 1940, as amended (the 1940 Act); and
WHEREAS, the Directors of the Company have determined that there is a reasonable likelihood that the following Distribution Plan will benefit the Company and the holders of Class A Shares of the Summit Global Investments U.S. Low Volatility Equity Fund (the Fund);
NOW, THEREFORE, the Directors of the Company hereby adopt this Distribution Plan pursuant to Rule 12b-1 under the 1940 Act.
SECTION 1. The Company has adopted this Distribution Plan (the Plan) to enable the Company to directly or indirectly bear expenses relating to the distribution of Class A Shares of the Fund.
SECTION 2. The Company will pay the distributor of Class A Shares of the Fund a fee at the annual rate of 0.25% of the Funds average daily net assets attributable to Class A Shares. The distributor may retain all or part of this fee as compensation for distribution or shareholder services it provides or it may use such fees for compensation of broker/dealers and other financial institutions and intermediaries that provide distribution or shareholder services as specified by the distributor. The actual fee to be paid by the distributor to broker/dealers and financial institutions and intermediaries will be negotiated based on the extent and quality of services provided.
SECTION 3. This Plan shall not take effect until it has been approved (a) by a vote of at least a majority of the outstanding Class A Shares of the Fund; and (b) together with any related agreements, by votes of the majority of both (i) the Directors of the Company and (ii) the Qualified Directors (as defined herein), cast in person at a Board of Directors meeting called for the purpose of voting on this Plan or such agreement.
SECTION 4. This Plan shall continue in effect for a period of more than one year after it takes effect only for so long as such continuance is specifically approved at least annually in the manner provided in Part (b) of Section 3 herein for the approval of this Plan.
SECTION 5. Any person authorized to direct the disposition of monies paid or payable by the Company pursuant to this Plan or any related agreement shall provide to the Directors of the Company, at least quarterly, a written report of the amounts so expended and the purposes for which such expenditures were made.
SECTION 6. This Plan may be terminated at any time by the vote of a majority of the Qualified Directors or by vote of a majority of the outstanding Class A Shares of the Fund.
SECTION 7. All agreements with any person relating to implementation of this Plan shall be in writing, and any agreement related to this Plan shall provide (a) that such agreement may be terminated at any time, without payment of any penalty, by the vote of a majority of the Qualified Directors or by vote of a majority of the outstanding Class A Shares of the Fund, on not more than 60 days written notice to any other party to the agreement; and (b) that such agreement shall terminate automatically in the event of its assignment.
SECTION 8. This Plan may be amended in the manner provided in Part (b) of Section 3 herein for the approval of this Plan; provided, however, that the Plan may not be amended to increase materially the amount of distribution expenses permitted pursuant to Section 2 hereof without the approval of a majority of the outstanding Class A Shares of the Fund.
SECTION 9. While this Plan is in effect, the selection and nomination of those Directors who are not interested persons of the Company shall be committed to the discretion of the Directors then in office who are not interested persons of the Company.
SECTION 10. As used in this Plan, (a) the term Qualified Directors shall mean those Directors who are not interested persons of the Company, and have no direct or indirect financial interest in the operation of this Plan or any agreements related to it, and (b) the terms assignment and interested person shall have the respective meanings specified in the 1940 Act and the rules and regulations thereunder, subject to such exemptions as may be granted by the Securities and Exchange Commission.
SECTION 11. This Plan shall not obligate the Company or any other party to enter into an agreement with any particular person.
Adopted: December 8, 2011