Exhibit 99.d(5)
INVESTMENT MANAGEMENT AGREEMENT
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
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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
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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
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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%
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