INTERIM INVESTMENT ADVISORY AND ADMINISTRATION AGREEMENT
(Money Market Portfolio)
AGREEMENT made as of September 29, 2006 between THE
RBB FUND, INC., a Maryland corporation (herein called the
"Company"), and BLACKROCK INSTITUTIONAL MANAGEMENT CORPORATION,
a Delaware corporation (herein called the "Investment Advisor").
WHEREAS, the Company is registered as an open-end,
diversified, management investment company under the Investment
Company Act of 1940 (the "1940 Act") and currently offers
shares representing interests in separate investment
portfolios; and
WHEREAS, the Investment Advisor has been providing
investment advisory and administration services to the Company's
Money Market Portfolio (the "Portfolio") under an Investment
Advisory and Administration Agreement dated August 16, 1988,
which may have terminated as of the date hereof in connection
with a possible change in control involving the Investment
Advisor as regards the transaction defined below, and the
Investment Advisor will continue as investment adviser to the
Portfolio provided the conditions of Rule 15a-4 under the 1940
Act are met; and
WHEREAS, this day BlackRock, Inc. ("BRI") and Xxxxxxx
Xxxxx & Co., Inc. ("Xxxxxxx Xxxxx") are merging Xxxxxxx Xxxxx'x
investment management business with a subsidiary of BRI (the
"Transaction"); and
WHEREAS, the Company desires to continue to retain the
Investment Advisor to provide investment advisory and
administration services to the Portfolio following the
Transaction; and
WHEREAS, the Board of Directors of the Company has
approved this Agreement, and the Investment Advisor 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:
1. Appointment. The Company hereby appoints the
Investment Advisor to act as investment advisor to the Company
for the Portfolio for the period and on the terms set forth in
this Agreement. The Investment Advisor accepts such appointment
and agrees to render the services herein set forth, for the
compensation herein provided. The Company's Common Stock, $.001
par value (the "Shares") has been classified into different
classes of Common Stock. The Portfolio contains two classes of
Shares: the Class I Shares and the Class L Shares.
2. Delivery of Documents. The Company has furnished the
Investment Advisor with copies properly certified or
authenticated of each of the following:
(a) Articles of Incorporation of the Company, filed
with the Secretary of State of Maryland on February 29,
1988, as amended (such Articles of Incorporation, as
presently in effect and as they shall from time to time
be amended, herein called the "Articles of
Incorporation");
(b) Articles Supplementary of the Company, filed with
the Secretary of State of the State of Maryland on March
24, 1988 and all further Articles Supplementary filed
with the State of Maryland ("Articles Supplementary");
(c) By-Laws of the Company, as amended (such By-Laws,
as presently in effect and as they shall from time to
time be amended, herein called the "By-Laws");
(d) Resolutions of the Board of Directors of the Company
authorizing the appointment of the Investment Advisor
and the execution and delivery of this Agreement;
(e) A copy of each Distribution Agreement between the
Company and the Company's principal underwriter (the
"Distributor") relating to any class of Shares
representing interests in the Portfolio and the form of
each related Dealer Agreement, if any, for broker-
dealers participating in the distribution of any class
of Shares representing interests in the Portfolio
("Participating Dealers");
(f) Each Plan of Distribution pursuant to Rule 12b-1
under the 1940 Act, if any, relating to any class of
Shares representing interests in the Portfolio;
(g) Each Shareholder Servicing Agreement, if any,
relating to any class of Shares representing interests
in the Portfolio;
(h) Each Non-12b-1 Shareholder Services Plan, if any,
relating to any class of Shares representing interests
in the Portfolio;
(i) Notification of Registration of the Company under
the 1940 Act on Form N-8A as filed with the Securities
and Exchange Commission ("SEC") on March 24, 1988 and
all amendments thereto;
(j) The initial Registration Statement of the Company on
Form N-lA under the Securities Act of 1933 (the "1933
Act") (File No. 33-20827) and under the 1940 Act filed
with the SEC on March 24, 1988 relating to the Shares,
and all amendments thereto (the "Registration
Statement"); and
(k) Each Prospectus relating to any class of Shares
representing interests in the Portfolio in effect
under the 1933 Act (such prospectuses, as presently
in effect and as they shall from time to time be
amended and supplemented, are herein collectively
called the "Prospectuses").
The Company will furnish the Investment Advisor from time
to time with copies, properly certified or authenticated, of
all amendments of or supplements to the foregoing, if any.
3. Management of the Portfolio. Subject to the
supervision of the Board of Directors of the Company, the
Investment Advisor will provide for the overall management of
the Portfolio, including (i) the provision of a continuous
investment program for the Portfolio, including investment
research and management with respect to all securities,
investments, cash and cash equivalents in the Portfolio, (ii)
the determination from time to time of what securities and other
investments will be purchased, retained or sold by the Company
for the Portfolio, (iii) the placement of orders for all
purchases and sales made for the Portfolio, and (iv)
coordination of contractual relationships and communications
between the Company and its contractual service providers. The
Investment Advisor will provide the services rendered by it
hereunder in accordance with the investment objectives,
restrictions and policies of the Portfolio as stated in the
applicable Prospectus and the applicable statement of additional
information contained in the Registration Statement. The
Investment Advisor further agrees that it will maintain all
books and records with respect to the securities transactions of
the Portfolio, keep its respective books of account and will
render to the Company's Board of Directors such periodic and
special reports as the Board may request.
4. Brokerage. The Investment Advisor may place orders
either directly with the issuer or with any broker or dealer.
In placing orders with brokers and dealers, the Investment
Advisor will attempt to obtain the best net price and the most
favorable execution of its orders. In placing orders with such
broker or dealer, the Investment Advisor will consider the
experience and skill of the firm's securities traders as well
as the firm's financial responsibility and administrative
efficiency. Consistent with this obligation, when the execution
and price offered by two or more brokers or dealers are
comparable, the Investment Advisor may, in its discretion,
purchase and sell the Portfolio's securities to and from
brokers and dealers who provide the Company with research
advice and other services. In no instance will the Portfolio's
securities be purchased from or sold to the Distributor, the
Investment Advisor or any affiliated person thereof, except to
the extent permitted by SEC exemptive order or by applicable
law.
5. Administration Services.
(a) The Investment Advisor will perform the
following administration and accounting functions
on a daily basis:
(1) Journalize the Portfolio's investment, capital
share and income and expense activities;
(2) Verify investment buy/sell trade tickets and
transmit trades to the Company's custodian for proper
settlement;
(3) Maintain individual ledgers for
investment securities;
(4) Maintain historical tax lots for each security;
(5) Reconcile cash and investment balances of the
Portfolio with the custodian, and prepare the
beginning cash balance available for investment
purposes;
(6) Update the cash availability throughout the day
as required;
(7) Post to and prepare the Portfolio's Statement
of Assets and Liabilities and the Statement of
Operations;
(8) Calculate various contractual expenses (e.g.,
advisory/administration and custody fees);
(9) Monitor the expense accruals and notify
management of the Company of any proposed
adjustments;
(10) Control all disbursements from the
Portfolio and authorize such disbursements upon
Written Instructions;
(11) Calculate capital gains and losses;
(12) Determine the Portfolio's net income;
(13) Obtain security market quotes from services
approved by management of the Company, or if such
quotes are unavailable, then obtain such prices from
management of the Company, and in either case
calculate the market value of the Portfolio's
investments;
(14) Compute the net asset value of the
Portfolio; and
(15) Compute the Portfolio's yields, total return,
expense ratios, Portfolio turnover rate, and,
Portfolio average dollar-weighted maturity.
(b) In addition to the accounting services described in the
foregoing Paragraph 5(a), the Investment Advisor will:
(1) Prepare monthly financial statements, which will
include the following items:
Schedule of Investments
Statement of Assets and Liabilities
Statement of Operations
Statement of Changes in Net Assets
Cash Settlement
Schedule of Capital Gains and Losses;
(2) Prepare quarterly broker security
transactions summaries;
(3) Supply various normal and customary Portfolio
and Company statistical data as requested on an
ongoing basis;
(4) Prepare for execution and file the Portfolio's
and Company's Federal and state tax returns;
(5) Prepare and file the Company's Semi-Annual
Reports with the SEC on Form N-SAR and prepare and
file the Company's Rule 24f-2 Notice and Form N-PX
with the SEC;
(6) Prepare and file with the SEC the Portfolio's and
Company's annual, semi-annual and quarterly
Shareholder reports on Form N-CSR and Form N-Q;
(7) Assist with the preparation of registration
statements on Form N-lA and other filings relating to
the registration of Shares;
(8) Monitor the Company's status as a regulated
investment company under Sub-chapter M of the
Internal Revenue Code of 1986, as amended;
(9) Qualify the Class I Shares and the Class L Shares
for sale in each state in which the Company's Board of
Directors determines to sell the Class I Shares or the
Class L Shares and make all filings and take all
appropriate actions necessary to maintain and renew
such registrations of the Class I Shares and the Class
L Shares;
(10) Monitor the Company's compliance with the amounts
and conditions of each such state qualification; and
(11) Maintain the Company's fidelity bond as required
by the 1940 Act and obtain a directors and officers
liability policy.
(c) The Investment Advisor shall act as liaison with the
Company's independent registered public accounting firm and
shall provide account analyses, fiscal year summaries, and
other audit related schedules. The Investment Advisor shall
take all reasonable action in the performance of its
obligations under this Agreement to assure that the necessary
information is made available to such accountants for the
expression of their opinion, as such may be required by the
Company from time to time.
6. Conformity with Law; Confidentiality. The Investment
Advisor further agrees that it will comply with all applicable
Rules and Regulations of all Federal regulatory agencies having
jurisdiction over the Investment Advisor in the performance of
its duties hereunder (herein called the "Rules"). The
Investment Advisor will treat confidentially and as proprietary
information of the Company all records and other information
relative to the Company and prior, present or potential
shareholders, 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 Company, which approval shall not be
unreasonably withheld and may not be withheld where the
Investment Advisor may be exposed to civil or criminal contempt
proceedings for failure to comply, when requested to divulge
such information by duly constituted authorities, or when so
requested by the Company.
7. Services Not Exclusive. The investment management and
administration services rendered by the Investment Advisor
hereunder are not to be deemed exclusive, and the Investment
Advisor shall be free to render similar services to others so
long as its services under this Agreement are not impaired
thereby.
8. Books and Records. In compliance with the
requirements of Rule 31a-3 of the Rules, the Investment
Advisor hereby agrees that all records which it maintains for
the Portfolio are the property of the Company and further
agrees to surrender promptly to the Company any of such
records upon the Company's request. The Investment Advisor
further agrees to preserve for the periods prescribed by Rule
31a-2 the records required to be maintained by Rule 31a-1 of
the Rules.
9. Expenses. During the term of this Agreement, the
Investment Advisor will pay all expenses incurred by it in
connection with its activities under this Agreement other than
the cost of (including brokerage commissions, if any)
securities purchased for the Portfolio, the cost of any
independent pricing service used in valuing the Portfolio's
securities and fees and expenses of registering and qualifying
shares for distribution under state securities laws.
In addition, if the expenses borne by the Portfolio in
any fiscal year exceed the most restrictive applicable expense
limitations imposed by the securities regulations of any state
in which the Shares are registered or qualified for sale to the
public, the Investment Advisor shall reimburse the Portfolio for
any excess up to the amount of the fees payable by the Portfolio
to it during such fiscal year pursuant to Paragraph 10 hereof;
provided, however, that notwithstanding the foregoing, the
Investment Advisor shall reimburse the Portfolio for such excess
expenses regardless of the amount of such fees payable to it
during such fiscal year to the extent that the securities
regulations of any state in which the Shares are registered or
qualified for sale so require.
10. Compensation.
(a) For the services provided and the expenses assumed
pursuant to this Agreement with respect to the Portfolio, the
Company will pay the Investment Advisor from the assets of the
Portfolio and the Investment Advisor will accept as full
compensation therefor a fee, computed daily and payable monthly,
at the following annual rate: 0.45% of-the first $250 million of
the Portfolio's average daily net assets, 0.40% of the next $250
million of the Portfolio's average daily net assets, and 0.35%
of the Portfolio's average daily net assets in excess of $500
million.
(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
Company.
11. Limitation of Liability of the Investment Advisor. The
Investment Advisor shall not be liable for any error of judgment
or mistake of law or for any loss suffered by the Company in
connection with the matters to which this Agreement relates,
except a loss resulting from a breach of fiduciary duty with
respect to the receipt of compensation for services or a loss
resulting from willful misfeasance, bad faith or gross
negligence on the part of the Investment Advisor in the
performance of its duties or from reckless disregard by it of
its obligations and duties under this Agreement.
12. Duration and Termination. The term of this Agreement
shall begin on the date first above written and shall terminate
without penalty upon the earlier of (i) 150 days from the date
hereof, (ii) 10 calendar days' written notice by the Company to
the Investment Advisor, provided that the Company's Board of
Directors or a Majority (as defined below) of the outstanding
voting securities of the Portfolio have voted to terminate the
Agreement; (iii) an event of assignment (as defined in the 1940
Act); and (iv) upon the effective date of an Investment Advisory
and Administration Agreement between the Investment Advisor and
the Company that has received the approval of the vote of a
Majority of the Portfolio's outstanding voting securities. For
purposes of the foregoing, "Majority" is defined as the lesser
of (a) 67% of the shares of the Portfolio represented at a
meeting if holders of more than 50% of the outstanding shares of
the Portfolio are present in person or by proxy or (b) more than
50% of the outstanding shares of the Portfolio. Subject to
Section 13, termination of this Agreement shall not affect the
right of the Investment Advisor to receive payments on any
unpaid balance of the compensation to which it is entitled under
this Agreement earned prior to such termination.
13. Escrow Provisions. a) Notwithstanding any other
provision of this Agreement, in no event shall compensation paid
to the Investment Advisor hereunder exceed the amount permitted
by Rule 15a-4 under the 1940 Act. All compensation paid to the
Investment Advisor hereunder shall be held in an interest-
bearing escrow account with the Portfolio's custodian (the
"Escrow Account"). Funds held in the Escrow Account, including
interest earned ("Escrow Money"), shall be paid to the
Investment Advisor promptly after approval of an Investment
Advisory and Administration Agreement between the Investment
Advisor and the Company by the vote of a Majority of the
Portfolio's outstanding voting securities in accordance with the
1940 Act, provided that such approval is obtained no later than
150 days after the date of this Agreement.
(b) Notwithstanding any other provision of this Agreement,
if an Investment Advisory and Administration Agreement between
the Investment Advisor and the Company is not approved by a vote
of a Majority of the Portfolio's outstanding voting securities
within the time period stated above, the Investment Advisor
shall receive from the Escrow Account as full compensation for
its services hereunder the lesser of: (x) any costs incurred by
the Investment Advisor in performing this Agreement plus any
interest earned on that amount while in escrow, or (y) the total
amount in the Escrow Account plus interest if earned.
14. Delegation. On thirty (30) days prior written notice
to the Portfolio, the Investment Advisor may delegate those of
its duties set forth in Paragraph 5 hereof to any wholly-owned
direct or indirect subsidiary of The PNC Financial Services
Group, Inc. provided that (i) the delegate agrees with the
Investment Advisor to comply with all relevant provisions of the
1940 Act; and (ii) the Investment Advisor and such delegate
shall promptly provide such information as the Portfolio may
request, and respond to such questions as the Portfolio may ask,
relative to the delegation, including (without limitation) the
capabilities of the delegate. Any delegation under this
paragraph shall not be deemed an assignment for purposes of
paragraph 12 hereof. Notwithstanding any such delegation, the
Investment Advisor shall remain responsible for the performance
of its duties set forth in Paragraph 5 hereof and shall hold the
Portfolio harmless from the acts and omissions, under the
standards of care provided for herein, of any delegate chosen
pursuant to this Paragraph 14.
15. Amendment of this Agreement. No provision of this
Agreement may be changed, discharged or terminated orally,
except by an instrument in writing signed by the party against
which enforcement of the change, discharge or termination is
sought, and no amendment of this Agreement affecting the
Portfolio shall be effective until approved by vote of the
holders of a majority of the outstanding voting securities of
the Portfolio.
16. Miscellaneous. The captions in this Agreement are
included for convenience of reference only and in no way define
or delimit any of the provisions hereof or otherwise affect
their construction or effect. If any provision of this Agreement
shall be held or made invalid by a court decision, statute, rule
or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective
successors and shall be governed by Delaware law.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as
of the day and year first above written.
THE RBB FUND, INC.
By: /s/ Xxxxxx X. Xxxxx
Title: President
BLACKROCK INSTITUTIONAL
MANAGEMENT CORPORATION
By: /s/ Xxxx Xxxxx
Title:
