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T. ROWE PRICE
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Prime Reserve Fund, Inc.
T. Rowe Price Prime Reserve Fund -- PLUS Class
Supplement to prospectus dated October 1, 1999
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Effective May 1, 2000, the footnote to Table 2 on page 4 of the Prospectus will
be revised with the following to reflect the extension of the fund's expense
ratio limitation:
/a/
Effective May 1, 2000, T. Rowe Price contractually obligated itself to waive
any fees and bear any expenses through April 30, 2002, to the extent such
fees or expenses would cause the ratio of expenses to average net assets to
exceed 1.00%. Fees waived or expenses paid or assumed under this agreement
are subject to reimbursement to T. Rowe Price whenever the fund's expense
ratio is below 1.00%; however, no reimbursement will be made after April 30,
2004, or if it would result in the expense ratio exceeding 1.00%. Any amounts
reimbursed have the effect of increasing fees otherwise paid by the fund. The
fund operated under previous expense limitations for which T. Rowe Price may
be reimbursed.
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The date of this supplement is May 1, 2000.
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F25-041 5/1/00
