Exhibit d(v)
COMPREHENSIVE FEE
INVESTMENT MANAGEMENT AGREEMENT
THIS AGREEMENT ("Agreement"), dated the 1st day of October, 2004, made and
entered into by and between HALLMARK INVESTMENT SERIES TRUST a Delaware business
trust (the "Trust"), on behalf of HALLMARK FIRST MUTUAL, HALLMARK TOTAL RETURN
BOND FUND and HALLMARK CONVERTIBLE SECURITIES FUND (each, a "Fund" and together,
the "Funds"), 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 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, payments made pursuant
to the Trust's Distribution Plan, and the fees of the Trustees who are not
interest 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 the Manager; provided, however any such compensation will be the
responsibility of the Manager.
3. COMPENSATION OF THE MANAGER. The First Mutual Fund shall pay to the
Manager as compensation for the services rendered hereunder and as full
reimbursement for all officers compensation and ordinary operating expenses of
the Fund 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 an annual rate of 1.30% of the Fund's average daily net asset value
attributable to the Class R shares of the Fund and at an annual rate of 1.00% of
the Fund's average daily net asset value attributable to the Class I shares of
the Fund (the "Management Fee").
The Total Return Bond Fund shall pay to the Manager as compensation for
the services rendered hereunder and as full reimbursement for all officers
compensation and ordinary operating expenses of the Fund 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 an annual rate of 1.05% of
the Fund's average daily net asset value attributable to the Class R shares of
the Fund and at an annual rate of 1.00% of the Fund's average daily net asset
value attributable to the Class I shares of the Fund (the "Management Fee").
The Convertible Securities Fund shall pay to the Manager as compensation
for the services rendered hereunder and as full reimbursement for all officers
compensation and ordinary operating expenses of the Fund 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 an annual rate of 1.25% of
the Fund's average daily net asset value attributable to the Class R shares of
the Fund and at an annual rate of 1.00% of the Fund's average daily net asset
value attributable to the Class I shares of the Fund (the "Management Fee").
The Management Fee shall be computed and accrued daily and shall be paid
by the Fund to the Manager periodically.
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 until the close of
business on September 28, 2006 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, as provided herein, 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, and .
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 "Hallmark" 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 "Hallmark."
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.
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, trustees, 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.
HALLMARK INVESTMENT SERIES TRUST,
ON BEHALF OF
Hallmark First Mutual Fund
Hallmark Total Return Bond Fund
Hallmark Convertible
Securities Fund
By /s/ Xxxxx X. Xxxx XX
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President
ATTEST:
/s/ Xxx X. Xxxxx
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Secretary
RESERVE MANAGEMENT COMPANY, INC.
By /s/ Xxxxx X. Xxxx
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President
ATTEST
/s/ Xxxxx X. Xxxx XX
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Secretary
