EXHIBIT 99.(d)(5)
COMPREHENSIVE FEE
INVESTMENT MANAGEMENT AGREEMENT
THIS AGREEMENT ("Agreement"), dated the 29th day of September, 2005,
made and entered into by and between The Reserve Fund, a Massachusetts
business trust (the "Trust"), on behalf of Reserve Liquid Performance Money
Market Fund (the "Fund"), and Reserve Management Company, Inc., a New Jersey
corporation having its principal place of business in New York (the
"Manager").
WHEREAS, the Trust is an investment management company registered under
the Investment Company Act of 1940, as amended (the "Investment Company
Act"); and
WHEREAS, the Trust is authorized to issue an unlimited number of shares
of beneficial interest, no par value, in separate series or classes of
series, each representing an interest in a separate portfolio of investment
securities and other assets;
The parties agree as follows:
1. INVESTMENT SERVICES. The Manager shall select and manage the Fund's
investments and shall determine what investments shall be made or disposed of
by the Fund and shall effect such acquisitions and dispositions, all in
furtherance of the Fund's investment objective and policies, subject to the
overall control and direction of the Board of Trustees of the Trust (the
"Trustees"). The Manager shall report on such activities to the Trustees and
shall submit such reports and other information thereon as the Trustees shall
from time to time request. Notwithstanding any other provision hereof, the
Manager, with the approval of the Trustees, may contract with one or more
Sub-Investment Managers to perform any of the investment management services;
provided, however, any compensation paid will be the sole responsibility of
the Manager.
2. OTHER SERVICES AND ASSUMPTION OF CERTAIN EXPENSES. The Manager shall
furnish (or arrange for affiliates to furnish) to the Trust, on behalf of the
Fund: (i) the services of a President and such other executive officers as
may be requested by the Fund, (ii) office space and customary office
facilities to the extent that the Fund's activities occur in New York, (iii)
maintain Fund records not otherwise maintained by the Fund's custodian,
distributor or sub-investment managers, and (iv) all accounting,
administrative, clerical, secretarial and statistical services as may be
required by the Fund for the operation of its business and compliance with
applicable laws. The Manager shall pay the compensation of all officers of
the Trust on behalf of the Fund and all operating and other expenses of the
Fund except interest charges, taxes, brokerage fees and commissions,
extraordinary legal and accounting fees and other extraordinary expenses
including expenses incurred in connection with litigation proceedings, other
claims and the legal obligations of the Trust to indemnify its trustees,
officers, employees, shareholders, distributors and other agents of the
Trust, insurance, payments made pursuant to the Trust's Distribution Plan,
state (blue sky) and SEC registration fees and other government imposed fees
and expenses, costs of shareholder meetings, including proxy solicitations,
the compensation of the chief compliance officer and related expenses, and
the fees of the Trustees who are not interested persons of the Manager as
defined in the Investment Company Act. The Manager may contract with other
parties to perform any of the ordinary administrative services required of an
administrator; provided, however any compensation paid for such services will
be the responsibility of the Manager.
3. COMPENSATION OF THE MANAGER. The Fund shall pay to the Manager as
compensation for the services rendered hereunder and as full reimbursement
for all officers, compensation and expenses of the Fund required to be paid
by the Manager under paragraph 2 hereof, a management fee (as a percentage of
the average daily net assets attributable to each class of shares) at annual
rates expressed as percentages of the Fund's average daily net asset value
attributable to the various classes of the Fund's shares as set forth in
Schedule A (the "Management Fee"), calculated on a 365-day basis. Of this
amount, .08% of the Fund's average daily net asset value attributable to each
class (the "Advisory Fee") shall be for investment advisory services. The
difference between the Advisory Fee and the Management Fee (if any) (such
amount, the "Administrative Component") shall be for non-advisory services
provided by the Manager or its affiliate(s). None of the services under the
Administrative Component shall be distribution services required to be
covered under a plan adopted pursuant to Rule 12b-1 under the Investment
Company Act. To
the extent permitted by law, the Manager may use a portion of the Management
Fee and its own other resources to pay financial intermediaries whose clients
and/or customers invest in the Fund.
The Management Fee shall be computed and accrued daily and shall be paid
by the Fund to the Manager periodically.
If in any fiscal year the Manager waives fees and/or reimburses Fund
expenses, the Manager shall be entitled to recover such amounts from the Fund
during the three-year period following the end of the fiscal year in which
such waiver and/or reimbursement occurred. Subject to the three-year
limitation, the older unrecovered fee waivers and expense reimbursements will
be recoverable before later ones. The terms of any such recoupment can be
modified by the Manager and the Board of Trustees from time to time without
shareholder approval.
4. COMPLIANCE WITH APPLICABLE REQUIREMENTS. This Agreement will be
performed in accordance with the requirements of the Investment Company Act
and the Investment Advisers Act of 1940, as amended, and the rules and
regulations under such acts, to the extent that the subject matter of the
Agreement is within the purview of such acts and such rules and regulations.
The Manager will assist the Trust on behalf of the Fund in complying with the
requirements of the Investment Company Act, and the Securities Act of 1933,
as amended (the "Securities Act"), and the rules and regulations under such
Acts and in qualifying as a regulated investment company under the Internal
Revenue Code of 1986, as amended, and applicable regulations of the Internal
Revenue Service thereunder. In carrying out its obligations under this
Agreement, the Manager shall at all times conform to the provisions of the
Declaration of Trust and By-Laws, the provisions of the currently effective
Registration Statement of the Fund under the Investment Company Act and the
Securities Act, and any other applicable provisions of state or Federal law.
5. TERMINATION. This Agreement shall be in effect for an initial
two-year period, and shall continue in effect from year to year thereafter,
but only so long as such continuance is specifically approved at least
annually by (i) either a majority of the Board of Trustees of the Trust or
the vote of a majority of the outstanding voting securities of the Fund, and
(ii) separately by a majority of the Trustees who are not parties to this
Agreement or interested persons (as defined in the Investment Company Act) of
any party to this Agreement, cast in person at a meeting called for the
purpose of voting on such approval; provided, however, that if the
shareholders of the Fund fail to approve the Agreement, if required by law,
the Manager may continue to serve in such capacity in the manner and to the
extent permitted by the Investment Company Act, and the rules thereunder.
Notwithstanding anything herein to the contrary, this Agreement may be
terminated at any time, without payment of any penalty, by the Trustees of
the Trust or by vote of a majority of the outstanding voting securities of
the Fund, on 60 days' written notice to the Manager, or by the Manager on
like notice to the Trust.
The name "Reserve" or "Reserv" or any variation of them shall be deemed
to have been licensed to the Trust by the Manager. In the event of
termination of this Agreement, the Manager may terminate or revoke such
license on 90 days' written notice to the Trust. On or before the date of
such revocation or termination, the Trust will change its name to another
name which does not include the word "Reserve."
6. NON-ASSIGNABILITY. This Agreement shall not be assignable by either
party hereto and shall automatically terminate forthwith in the event of such
assignment, within the meaning of the Investment Company Act.
7. APPROVAL OF AMENDMENTS. Any material amendments to this Agreement
shall be approved by vote of the holders of a majority of the outstanding
voting securities (as defined in the Investment Company Act) of the Fund,
except that an increase in the Administrative Component of the Management Fee
need not be approved by any vote of the outstanding voting securities of the
Fund but may be implemented if approved by a majority of the Board of
Trustees of the Trust and separately by a majority of the Trustees who are
not parties to this Agreement or interested persons (as defined in the
Investment Company Act) of any party to this Agreement, which need not be
cast in person at a meeting called for the purpose of voting on such approval.
8. NON-EXCLUSIVITY. The services of the Manager to the Trust are not to
be deemed exclusive and the Trust agrees that the Manager is free to act as
investment manager to various investment companies and other managed
accounts. For purposes of this Agreement and the undertakings provided for
herein, the Manager shall at all times be
considered as an independent contractor, and shall not be considered as an
agent of the Trust and shall have no authority to act for or represent the
Trust in any way.
9. LIABILITY OF THE MANAGER. In performing its duties hereunder, the
Manager may rely on all documentation and information furnished it by the
Trust. Except as may otherwise be provided by the Investment Company Act,
neither the Manager nor its officers, directors, employees or agents shall be
subject to any liability for any act or omission in the course of, connected
with or arising out of any services to be rendered hereunder, except by
reason of willful misfeasance, bad faith or gross negligence in the
performance of the Manager's duties or by reason of reckless disregard of the
Manager's obligations and duties under this Agreement.
10. NOTICES. Any notices and communications required hereunder shall be
in writing and shall be deemed given when delivered in person or when sent by
first-class, registered or certified mail to the Manager or to the Trust at
0000 Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at such addresses as
either party may from time to time specify by notice to the other.
11. DEFINITIONS. The terms "assignment," "interested person," and
"majority of the outstanding voting securities," when used in this Agreement,
shall have the respective meanings specified under the Investment Company Act
and the rules thereunder.
12. GOVERNING LAW. The terms and provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the State of New
York as at the time in effect and the applicable provisions of the Investment
Company Act. To the extent that the applicable law of the State of New York,
or any of the provisions herein, conflict with the applicable provisions of
the Investment Company Act, the latter shall control.
13. SEVERABILITY. 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 be deemed to be severable.
14. SHAREHOLDER LIABILITY. The Manager understands and agrees that the
obligations of the Trust under this Agreement are not binding upon any
shareholder of the Trust personally, but bind only the Fund and the property
of the Fund. The Manager represents that it has notice of the provisions of
the Declaration of Trust of the Trust disclaiming shareholder liability for
acts or obligations of the Trust.
15. ENFORCEMENT LIMITED TO FUND. The Manager understands and agrees that
any debts, liabilities, obligations, and expenses incurred, contracted for or
otherwise existing under this Agreement shall be enforceable against the
assets of the Fund only, and not against the assets of the Trust, generally,
or the assets of any other separate series of the Trust.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed on the day and year first above written.
THE RESERVE FUND, ON BEHALF OF
RESERVE LIQUID PERFORMANCE MONEY MARKET FUND
By: /s/ Xxxxx X. Xxxx XX
Co-Chief Executive Officer
ATTEST:
/s/ Xxx X. Xxxxx
Secretary
RESERVE MANAGEMENT COMPANY, INC.
By: /s/ Xxxxx X. Xxxx
President
ATTEST:
/s/ Xxx X. Xxxxx
Secretary
SCHEDULE A
CLASS FEE
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Class 10 0.10%
Class 15 0.15%
Class 20 0.20%
Class 25 0.25%
Class 35 0.35%
Class 45 0.45%
