Exhibit (d)(14)
RESTATED EXPENSE LIMITATION AGREEMENT
ING MUTUAL FUNDS
This RESTATED EXPENSE LIMITATION AGREEMENT (this "Agreement"), effective
this 1st day of August 2003, restates the Expense Limitation Agreement dated
December 5, 2002 by and between ING Investments, LLC (the "Investment Manager"),
ING Mutual Funds (the "Registrant") and ING Investment Management Advisors B.V.
(the "Sub-Adviser"). If the Registrant is a series fund investment company, then
the Registrant is entering into this Agreement on behalf of, and this Agreement
shall apply to, each series of the Registrant set forth on Schedule A hereto
(each a "Fund," collectively the "Funds"), as such schedule may be amended from
time to time to add or delete series. If the Registrant is not a series fund
investment company, then this Agreement shall apply to the Registrant, and the
use of the terms "Fund" or "Funds" herein shall refer to the Registrant.
WHEREAS, the Registrant is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end management company; and
WHEREAS, the Registrant, the Investment Manager and the Sub-Adviser desire
that the provisions of this Agreement do not adversely affect a Fund's status as
a "regulated investment company" under Subchapter M of the Internal Revenue Code
of 1986, as amended (the "Code"), do not interfere with a Fund's ability to
compute its taxable income under Code Section 852, do not adversely affect the
status of the distributions a Fund makes as deductible dividends under Code
Section 562, and do comply with the requirements of Revenue Procedure 99-40 (or
any successor pronouncement of the Internal Revenue Service); and
WHEREAS, the Registrant and the Investment Manager have entered into an
investment management agreement (the "Management Agreement"), pursuant to which
the Investment Manager provides investment advisory services to each Fund; and
WHEREAS, the Investment Manager and the Sub-Adviser have entered into an
investment management sub-advisory agreement (the "Sub-Advisory Agreement"),
pursuant to which the Sub-Adviser provides investment advisory services to one
or more of the Funds; and
WHEREAS, the Registrant, the Investment Manager and the Sub-Adviser have
determined that it is appropriate and in the best interests of the Funds and
their shareholders to maintain the expenses of each Fund at a level below the
level to which each such Fund might otherwise be subject.
NOW, THEREFORE, the parties hereto agree as follows:
1. Expense Limitation.
1.1 Applicable Expense Limit. To the extent that the ordinary operating
expenses, including but not limited to investment advisory fees payable to the
Investment Manager, but excluding interest, taxes, other investment-related
costs, leverage expenses (as defined below), extraordinary expenses such as
litigation, other expenses not incurred in the ordinary course of such Fund's
business, and expenses of any counsel or other persons or services retained by
such Fund's Trustees who are not "interested persons," as that term is defined
in the 1940 Act, of the Investment Manager (the "Fund
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Operating Expenses"), incurred by a class of a Fund listed on Schedule A in any
fiscal year exceed the Operating Expense Limit, as defined in Section 1.2 below,
for such class for such fiscal year, such excess amount (the "Excess Amount")
shall be the liability of the Investment Manager. For the purposes of this
Agreement, leverage expenses shall mean fees, costs and expenses incurred by a
Fund's use of leverage (including, without limitation, expenses incurred by a
Fund in creating, establishing and maintaining leverage through borrowings or
the issuance of preferred shares).
1.2 Operating Expense Limit. The Operating Expense Limit in any fiscal
year with respect to each class of a Fund shall be the amount specified in
Schedule A.
1.3 Daily Computation. The Investment Manager shall determine on each
business day whether the aggregate fiscal year to date Fund Operating Expenses
for any class of a Fund exceed the Operating Expense Limit, as such Operating
Expense Limit has been pro-rated to the date of such determination (the
"Pro-Rated Expense Cap"). If, on any business day, the aggregate fiscal year to
date Fund Operating Expenses for any class of a Fund do not equal the Pro-Rated
Expense Cap for that class, the amount of such difference shall be netted
against the previous day's accrued amount for Excess Amounts or Recoupment
Amounts (as defined below), and the difference shall be accrued for that day as
an Excess Amount or Recoupment Amount as applicable.
1.4 Payment. At the end of each month, the accruals made pursuant to
Section 1.3 above shall be netted, and the result shall be remitted by the
Investment Manager to the Fund if such netting results in an Excess Amount, and
it shall be remitted to the Investment Manager if such netting results in a
Recoupment Amount and the Investment Manager is entitled to a Recoupment Amount
pursuant to Section 2.1 below. Any such amounts remitted to a Fund, or repaid by
a Fund, shall be allocated among the classes of the Fund in accordance with the
terms of the Fund's Multiple Class Plan Pursuant to Rule 18f-3 under the 1940
Act. The Registrant may offset amounts owed to a Fund pursuant to this Agreement
against the Fund's advisory fee payable to the Investment Manager.
2. Right to Recoupment. If the Investment Manager has waived or reduced any
investment advisory fees, or made any payments pursuant to Section 1.4 above,
relating to any of the 36 months immediately preceding any month end calculation
pursuant to Section 1.4 above, the Investment Manager shall be entitled to
recoup from a Fund any such investment advisory fees waived or reduced and any
such payments made (collectively, a "Recoupment Amount"), if (i) on the date of
any calculation under Section 1.3, the aggregate fiscal year to date Fund
Operating Expenses for any class of a Fund are less than that day's Pro-Rated
Expense Cap for that class, and (ii) such Recoupment Amounts have not already
been recouped. Any amounts recouped from a class of a Fund shall be recouped in
accordance with the principles of the Fund's Multiple Class Plan Pursuant to
Rule 18f-3 under the 1940 Act. Amounts recouped shall be allocated to the oldest
Recoupment Amounts during such 36-month period until fully recouped, and
thereafter to the next oldest Recoupment Amounts, and so forth.
3. Contribution by Sub-Advisers.
3.1 Waiver and/or reduction of fees. The Sub-Adviser agrees to waive
and/or reduce its investment advisory fees under the Sub-Advisory Agreement, in
the same percentage, and for the same time period, for any Fund subject to the
Sub-Advisory Agreement for which the Investment Manager waives and/or reduces
its investment advisory fees under the Management Agreement.
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3.2 Payment of Excess Amounts. The Sub-Adviser shall pay to the
Investment Manager a portion of any Excess Amounts paid by the Investment
Manager hereunder with regard to any Fund subject to the Sub-Advisory
Agreement. The Sub-Adviser's portion of such Excess Amounts shall be the same
percentage of such Excess Amounts as the percentage of the investment advisory
fees for such Fund that the Sub-Adviser receives from the Investment Manager.
The Investment Manager may offset amounts owed to the Investment Manager
pursuant to this Section 3.2 against the sub-advisory fees paid to the
Sub-Adviser. Otherwise, the Investment Manager shall provide an invoice to the
Sub-Adviser and the Sub-Adviser shall pay such invoice promptly upon receipt.
3.3 Allocation of Recoupments. The Investment Manager shall promptly
remit to the Sub-Adviser a portion of any amounts recouped by the Investment
Manager pursuant to Section 2 of this Agreement that relate to the waiver
and/or reduction of fees or the payment of Excess Amounts by the Sub-Adviser.
The portion to be paid to the Sub-Adviser shall be the same percentage of the
Recoupment Amount as the percentage of the waiver and/or reduction of fees or
the payment of Excess Amounts by the Sub-Adviser bears to the total waiver
and/or reduction of fees or the payment of Excess Amounts to which such
recoupment relates.
3.4 Accounting. The Investment Manager will provide to the Sub-Adviser
reasonable access to the books and records of the applicable Fund and the
Investment Manager for the purpose of confirming the amounts waived, reduced,
paid or recouped by the Investment Manager under this Agreement.
3.5 Term and Termination of Sub-Advisers' Obligations and Rights. The
Sub-Adviser's obligations under Sections 3.1 and 3.2, and its rights under
Section 3.3, shall begin as of the date the Sub-Adviser becomes a signatory
hereto and shall end upon the earlier of the termination of this Agreement, the
Management Agreement or the Sub-Advisory Agreement.
4. Term and Termination. This Agreement shall have an initial term with
respect to each Fund ending on the date indicated on Schedule A, as such
schedule may be amended from time to time. Thereafter, this Agreement shall
automatically renew for one-year terms with respect to a Fund unless the
Investment Manager provides written notice of the termination of this Agreement
to a lead Independent Trustee of the Registrant within 90 days of the end of
the then current term for that Fund. In addition, this Agreement shall
terminate with respect to a Fund upon termination of the Management Agreement
with respect to such Fund, or it may be terminated by the Registrant, without
payment of any penalty, upon written notice to the Investment Manager at its
principal place of business within 90 days of the end of the then current term
for a Fund.
5. Miscellaneous.
5.1 Captions. The captions in this Agreement are included for convenience
of reference only and in no other way define or delineate any of the provisions
hereof or otherwise affect their construction or effect.
5.2 Interpretation. Nothing herein shall be deemed to require the
Registrant or a Fund to take any action contrary to the Registrant's articles
of incorporation, declaration of trust, or similar governing document, an
applicable prospectus or statement of additional information, or any applicable
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statutory or regulatory requirement, or to relieve or deprive the Registrant's
Board of Trustees of its responsibility for and control of the conduct of the
affairs of the Registrant or the Funds.
5.3 Definitions. Any question of interpretation of any term or provision
of this Agreement, including but not limited to the investment management fee,
the computations of net asset values, and the allocation of expenses, having a
counterpart in or otherwise derived from the terms and provisions of the
Management Agreement, the Sub-Advisory Agreement or the 1940 Act, shall have
the same meaning as and be resolved by reference to such Management Agreement,
Sub-Advisory Agreement or the 1940 Act.
5.4 Amendments. This Agreement may be amended only by a written agreement
signed by each of the parties hereto.
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
by their respective officers thereunto duly authorized, as of the day and year
first above written.
ING MUTUAL FUNDS ING INVESTMENTS, LLC
By: By:
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Name: Xxxxxx X. Naka Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President Title: Executive Vice President
ING INVESTMENT MANAGEMENT
ADVISORS B.V.
By:
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Name:
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Title:
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SCHEDULE A
TO THE
RESTATED EXPENSE LIMITATION AGREEMENT
ING MUTUAL FUNDS
OPERATING EXPENSE LIMITS
NAME OF FUND OPERATING EXPENSE LIMIT PERCENTAGE
(AS A PERCENTAGE OF AVERAGE NET ASSETS)
Class A Class B Class C Class I Class Q
ING Emerging Countries Fund 2.25% 2.90% 2.90% 2.65% 2.15%
Expiration of Initial Term: October 31, 2003
ING Russia Fund 3.35% 4.10% N/A N/A N/A
Expiration of Initial Term: October 31, 2003
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