INVESTMENT MANAGEMENT SERVICES AGREEMENT
AGREEMENT made the 1st day of July, 1999, by and between AXP Money Market
Series, Inc. (the "Corporation"), a Minnesota corporation, on behalf of its
underlying series fund AXP Cash Management Fund (the "Fund"), and American
Express Financial Corporation, a Delaware corporation.
Part One: INVESTMENT MANAGEMENT AND OTHER SERVICES
(1) The Fund hereby retains American Express Financial Corporation, and American
Express Financial Corporation hereby agrees, for the period of this Agreement
and under the terms and conditions hereinafter set forth, to furnish the Fund
continuously with suggested investment planning; to determine, consistent with
the Fund's investment objectives and policies, which securities in American
Express Financial Corporation's discretion shall be purchased, held or sold and
to execute or cause the execution of purchase or sell orders; to prepare and
make available to the Fund all necessary research and statistical data in
connection therewith; to furnish services of whatever nature required in
connection with the management of the Fund as provided under this Agreement; and
to pay such expenses as may be provided for in Part Three; subject always to the
direction and control of the Board of Directors (the "Board"), the Executive
Committee and the authorized officers of the Fund. American Express Financial
Corporation agrees to maintain an adequate organization of competent persons to
provide the services and to perform the functions herein mentioned. American
Express Financial Corporation agrees to meet with any persons at such times as
the Board deems appropriate for the purpose of reviewing American Express
Financial Corporation's performance under this Agreement.
(2) American Express Financial Corporation agrees that the investment planning
and investment decisions will be in accordance with general investment policies
of the Fund as disclosed to American Express Financial Corporation from time to
time by the Fund and as set forth in its prospectuses and registration
statements filed with the United States Securities and Exchange Commission (the
"SEC").
(3) American Express Financial Corporation agrees that it will maintain all
required records, memoranda, instructions or authorizations relating to the
acquisition or disposition of securities for the Fund.
(4) The Fund agrees that it will furnish to American Express Financial
Corporation any information that the latter may reasonably request with respect
to the services performed or to be performed by American Express Financial
Corporation under this Agreement.
(5) American Express Financial Corporation is authorized to select the brokers
or dealers that will execute the purchases and sales of portfolio securities for
the Fund and is directed to use its best efforts to obtain the best available
price and most favorable execution, except as prescribed herein. Subject to
prior authorization by the Fund's Board of appropriate policies and procedures,
and subject to termination at any time by the Board, American Express Financial
Corporation may also be authorized to effect individual securities transactions
at commission rates in excess of the minimum commission rates available, to the
extent authorized by law, if American Express Financial Corporation determines
in good faith that such amount of commission was reasonable in relation to the
value of the brokerage and research services provided by such broker or dealer,
viewed in terms of either that particular transaction or American Express
Financial Corporation's overall responsibilities with respect to the Fund and
other funds for which it acts as investment adviser.
(6) It is understood and agreed that in furnishing the Fund with the services as
herein provided, neither American Express Financial Corporation, nor any
officer, director or agent thereof shall be held liable to the Fund or its
creditors or shareholders for errors of judgment or for anything except willful
misfeasance, bad faith, or gross negligence in the performance of its duties, or
reckless disregard of its obligations and duties under the terms of this
Agreement. It is further understood and agreed that American Express Financial
Corporation may rely upon information furnished to it reasonably believed to be
accurate and reliable.
Part Two: COMPENSATION TO INVESTMENT MANAGER
(1) The Fund agrees to pay to American Express Financial Corporation, and
American Express Financial Corporation covenants and agrees to accept from the
Fund in full payment for the services furnished, a fee for each calendar day of
each year equal to the total of 1/365th (1/366th in each leap year) of each of
the respective percentages set forth below of the net assets of the Fund; to be
computed for each day on the basis of net assets as of the close of business of
the full business day two (2) business days prior to the day for which the
computation is being made. In the case of the suspension of the computation of
net asset value, the asset charge for each day during such suspension shall be
computed as of the close of business on the last full business day on which the
net assets were computed. Net assets as of the close of a full business day
shall include all transactions in shares of the Fund recorded on the books of
the Fund for that day.
Assets Annual Rate at
(Billions) Each Asset Level
First $1.0 0.360%
Next 0.5 0.343
Next 0.5 0.325
Next 0.5 0.308
Next 1.0 0.290
Next 3.0 0.270
Over 6.5 0.250
(2) The fee shall be paid on a monthly basis and, in the event of the
termination of this Agreement, the fee accrued shall be prorated on the basis of
the number of days that this Agreement is in effect during the month with
respect to which such payment is made.
(3) The fee provided for hereunder shall be paid in cash by the Fund to American
Express Financial Corporation within five business days after the last day of
each month.
Part Three: ALLOCATION OF EXPENSES
(1) The Fund agrees to pay:
(a) Fees payable to American Express Financial
Corporation for its services under the terms of this
Agreement.
(b) Taxes.
(c) Brokerage commissions and charges in connection with
the purchase and sale of assets.
(d) Custodian fees and charges.
(e) Fees and charges of its independent certified public
accountants for services the Fund requests.
(f) Premium on the bond required by Rule 17g-1 under the
Investment Company Act of 1940.
(g) Fees and expenses of attorneys (i) it employs in
matters not involving the assertion of a claim by a
third party against the Fund, its directors and
officers, (ii) it employs in conjunction with a claim
asserted by the Board against American Express
Financial Corporation, except that American Express
Financial Corporation shall reimburse the Fund for
such fees and expenses if it is ultimately determined
by a court of competent jurisdiction, or American
Express Financial Corporation agrees, that it is
liable in whole or in part to the Fund, and (iii) it
employs to assert a claim against a third party.
(h) Fees paid for the qualification and registration for
public sale of the securities of the Fund under the
laws of the United States and of the several states
in which such securities shall be offered for sale.
(i) Fees of consultants employed by the Fund.
(j) Directors, officers and employees expenses which
shall include fees, salaries, memberships, dues,
travel, seminars, pension, profit sharing, and all
other benefits paid to or provided for directors,
officers and employees, directors and officers
liability insurance, errors and omissions liability
insurance, worker's compensation insurance and other
expenses applicable to the directors, officers and
employees, except the Fund will not pay any fees or
expenses of any person who is an officer or employee
of American Express Financial Corporation or its
affiliates.
(k) Filing fees and charges incurred by the Fund in
connection with filing any amendment to its articles
of incorporation, or incurred in filing any other
document with the State of Minnesota or its political
subdivisions.
(l) Organizational expenses of the Fund.
(m) Expenses incurred in connection with lending
portfolio securities of the Fund.
(n) Expenses properly payable by the Fund, approved by
the Board.
(2) American Express Financial Corporation agrees to pay all expenses associated
with the services it provides under the terms of this Agreement. Further,
American Express Financial Corporation agrees that if, at the end of any month,
the expenses of the Fund under this Agreement and any other agreement between
the Fund and American Express Financial Corporation, but excluding those
expenses set forth in (1)(b) and (1)(c) of this Part Three, exceed the most
restrictive applicable state expenses limitation, the Fund shall not pay those
expenses set forth in (1)(a) and (d) through (n) of this Part Three to the
extent necessary to keep the Fund's expenses from exceeding the limitation, it
being understood that American Express Financial Corporation will assume all
unpaid expenses and xxxx the Fund for them in subsequent months but in no event
can the accumulation of unpaid expenses or billing be carried past the end of
the Fund's fiscal year.
Part Four: MISCELLANEOUS
(1) American Express Financial Corporation shall be deemed to be an independent
contractor and, except as expressly provided or authorized in this Agreement,
shall have no authority to act for or represent the Fund.
(2) A "full business day" shall be as defined in the By-laws.
(3) The Fund recognizes that American Express Financial Corporation now renders
and may continue to render investment advice and other services to other
investment companies and persons which may or may not have investment policies
and investments similar to those of the Fund and that American Express Financial
Corporation manages its own investments and/or those of its subsidiaries.
American Express Financial Corporation shall be free to render such investment
advice and other services and the Fund hereby consents thereto.
(4) Neither this Agreement nor any transaction had pursuant hereto shall be
invalidated or in any way affected by the fact that directors, officers, agents
and/or shareholders of the Fund are or may be interested in American Express
Financial Corporation or any successor or assignee thereof, as directors,
officers, stockholders or otherwise; that directors, officers, stockholders or
agents of American Express Financial Corporation are or may be interested in the
Fund as directors, officers, shareholders, or otherwise; or that American
Express Financial Corporation or any successor or assignee, is or may be
interested in the Fund as shareholder or otherwise, provided, however, that
neither American Express Financial Corporation, nor any officer, director or
employee thereof or of the Fund, shall sell to or buy from the Fund any property
or security other than shares issued by the Fund, except in accordance with
applicable regulations or orders of the SEC.
(5) Any notice under this Agreement shall be given in writing, addressed, and
delivered, or mailed postpaid, to the party to this Agreement entitled to
receive such, at such party's principal place of business in Minneapolis,
Minnesota, or to such other address as either party may designate in writing
mailed to the other.
(6) American Express Financial Corporation agrees that no officer, director or
employee of American Express Financial Corporation will deal for or on behalf of
the Fund with himself as principal or agent, or with any corporation or
partnership in which he may have a financial interest, except that this shall
not prohibit:
(a) Officers, directors or employees of American Express Financial Corporation
from having a financial interest in the Fund or in American Express
Financial Corporation.
(b) The purchase of securities for the Fund, or the sale of securities owned by
the Fund, through a security broker or dealer, one or more of whose
partners, officers, directors or employees is an officer, director or
employee of American Express Financial Corporation, provided such
transactions are handled in the capacity of broker only and provided
commissions charged do not exceed customary brokerage charges for such
services.
(c) Transactions with the Fund by a broker-dealer affiliate of American Express
Financial Corporation as may be allowed by rule or order of the SEC, and if
made pursuant to procedures adopted by the Fund's Board.
(7) American Express Financial Corporation agrees that, except as herein
otherwise expressly provided or as may be permitted consistent with the use of a
broker-dealer affiliate of American Express Financial Corporation under
applicable provisions of the federal securities laws, neither it nor any of its
officers, directors or employees shall at any time during the period of this
Agreement, make, accept or receive, directly or indirectly, any fees, profits or
emoluments of any character in connection with the purchase or sale of
securities (except shares issued by the Fund) or other assets by or for the
Fund.
Part Five: RENEWAL AND TERMINATION
(1) This Agreement shall continue in effect until June 30, 2001, or until a new
agreement is approved by a vote of the majority of the outstanding shares of the
Fund and by vote of the Fund's Board, including the vote required by (b) of this
paragraph, and if no new agreement is so approved, this Agreement shall continue
from year to year thereafter unless and until terminated by either party as
hereinafter provided, except that such continuance shall be specifically
approved at least annually (a) by the Board of the Fund or by a vote of the
majority of the outstanding shares of the Fund and (b) by the vote of a majority
of the directors 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. As used in this paragraph, the term "interested person" shall
have the same meaning as set forth in the Investment Company Act of 1940, as
amended (the "1940 Act").
(2) This Agreement may be terminated by either the Fund or American Express
Financial Corporation at any time by giving the other party 60 days written
notice of such intention to terminate, provided that any termination shall be
made without the payment of any penalty, and provided further that termination
may be effected either by the Board of the Fund or by a vote of the majority of
the outstanding voting shares of the Fund. The vote of the majority of the
outstanding voting shares of the Fund for the purpose of this Part Five shall be
the vote at a shareholders' regular meeting, or a special meeting duly called
for the purpose, of 67% or more of the Fund's shares present at such meeting if
the holders of more than 50% of the outstanding voting shares are present or
represented by proxy, or more than 50% of the outstanding voting shares of the
Fund, whichever is less.
(3) This Agreement shall terminate in the event of its assignment, the term
"assignment" for this purpose having the same meaning as set forth in the 1940
Act.
IN WITNESS THEREOF, the parties hereto have executed the foregoing
Agreement as of the day and year first above written.
AXP MONEY MARKET SERIES, INC.
AXP Cash Management Fund
By ____________________
Xxxxxx X. Xxx
Vice President
AMERICAN EXPRESS FINANCIAL CORPORATION
By ______________________
Xxxxxx X. Xxxxx
Vice President
