Exhibit 99.h(2)
SUB-ADMINISTRATION AGREEMENT
THIS AGREEMENT is dated effective the 1st day of April, 2005, by and
between ICON ADVISERS, INC. ("Administrator"), a Colorado corporation, and BISYS
FUND SERVICES OHIO, INC. ("BISYS" or "Sub-Administrator"), an Ohio corporation.
WHEREAS, the Administrator has entered into an Administration Agreement
dated March 1, 1999, as amended (the "Administration Agreement"), with ICON
Funds (the "Trust"), a Massachusetts business trust registered with the
Securities and Exchange Commission (the "Commission") as an open-end management
investment company, concerning the provision of various services, including but
not limited to administration services, for the various investment portfolios of
the Trust all as (individually referred to herein as a "Fund" and collectively
as the "Funds");
WHEREAS, the Administrator desires that BISYS perform certain
sub-administration services for the Trust and each of the Funds now in existence
or as hereafter may be established from time to time; and
WHEREAS, BISYS is willing to perform such services on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual premises and covenants
hereinafter contained, the Administrator and BISYS hereby agree as follows:
1. RETENTION OF BISYS.
The Administrator hereby retains BISYS to act as sub-administrator of the
Trust. BISYS and Administrator hereby agree that BISYS will perform the services
upon the terms set forth in this Agreement and the Schedules hereto.
BISYS shall, for all purposes herein, be deemed to be an independent
contractor and, except as otherwise expressly provided or authorized, shall have
no authority to act for or represent the Administrator or the Funds in any way,
and shall not be deemed an agent of the Administrator or any Funds.
2. SUB-ADMINISTRATION SERVICES.
BISYS shall perform the sub-administration services set forth in Schedule
A. BISYS agrees to perform the services described herein in accordance with the
service standards set forth in Schedule B. BISYS shall provide Administrator or
the Board of Trustees of the Trust (the "Board") with such reports related to
the services provided under this Agreement as they may reasonably request. BISYS
shall also provide reports related to the Funds' investment performance as may
reasonably be requested, but shall have no responsibility for supervising the
performance by any investment adviser or sub-adviser of its responsibilities.
BISYS shall perform such other administration services,
1
and furnish such Reports, for the Administrator and the Funds that are mutually
agreed upon by the parties from time to time, for which the Administrator will
pay BISYS the amounts agreed upon between them.
BISYS may utilize agents in its performance of its services under this
Agreement; provided, however, that (i) the Administrator's approval shall be
required to establish an arrangement in which a Sub-Agent acts as
sub-administrator ("Sub-Agent"); and (ii) any agent (including any Sub-Agent)
retained by BISYS shall be the agent of BISYS and not the agent of
Administrator or the Trust, and BISYS shall be fully responsible for the acts of
any such agent (or Sub-Agent) and shall not be relieved of any of its
responsibilities hereunder by the appointment of such agent (or Sub-Agent). In
the event that a Sub-Agent is retained by BISYS at the request or instruction of
the Trust or the Administrator, the foregoing shall not apply to the extent it
is inconsistent with any written agreement(s) entered into by the parties with
respect to such arrangement.
3. ALLOCATION OF CHARGES AND EXPENSES.
BISYS shall furnish at its own expense the executive, supervisory and
clerical personnel necessary to perform its obligations under this Agreement.
BISYS shall also provide all items which it is obligated to provide under this
Agreement, and shall pay all compensation, if any, of officers of the Trust (if
any) who are affiliated persons of BISYS or any affiliated entity of BISYS;
provided, however, that unless otherwise specifically provided, BISYS Shall not
be obligated to pay the compensation of any employee or agent of the Trust (who
is not a BISYS employee) retained by the Board to perform services on behalf of
the Administrator.
The Administrator (or the Trust or the relevant Funds, as the case may be)
assumes and shall pay or cause to be paid all other expenses of the
Administrator and the Funds that are not otherwise allocated herein, including,
without limitation, Fund organization costs, taxes, expenses for Fund legal and
auditing services, the expenses of preparing (including typesetting), printing
and mailing reports, prospectuses, statements of additional information, proxy
solicitation material and notices to existing Shareholders, all expenses
incurred in connection with issuing and redeeming shares of beneficial interest
in the Funds ("Shares"), the cost of custodial services, the cost of initial and
ongoing registration of the Shares under Federal and state securities laws, fees
and out-of-pocket expenses of Trustees who are not affiliated persons of BISYS
or any affiliate of BISYS, insurance, interest, brokerage costs, litigation and
other extraordinary or nonrecurring expenses, and all fees and charges of
investment advisers.
4. COMPENSATION OF THE SUB-ADMINISTRATOR
(a) The Administrator shall pay BISYS for the services to be provided by
BISYS under this Agreement in accordance with the fee schedule which is set
forth as Schedule C attached hereto. In addition, the Administrator shall
reimburse BISYS for all of its reasonable out-of-pocket expenses, including, but
not limited to, travel and lodging expenses incurred by officers and employees
of BISYS in connection with attendance at
2
(i) Board meetings and (ii) any other meetings for which such attendance is
requested by the Administrator or the Trust, or as agreed upon by the parties.
(b) If this Agreement becomes effective subsequent to the first day of a
month or terminates in accordance with its terms before the last day of a month,
BISYS' compensation for that part of the month in which this Agreement is in
effect shall be prorated in a manner consistent with the calculation of the fees
as set forth on the Fee Schedule. Payment of BISYS' compensation for the
preceding month shall be made promptly.
(c) Survival of Compensation Rights. All rights of compensation under this
Agreement for services performed as of the termination date shall survive the
termination of this Agreement.
5. TERM.
This Agreement shall continue in effect for a period of three (3) years,
until Xxxxx 00, 0000 (xxx "Xxxxxxx Xxxx"). Thereafter, unless otherwise
terminated as provided herein, this Agreement shall be renewed automatically for
successive one year periods (each a "Rollover Period"). This Agreement may be
terminated only (i) by provision of a written notice of nonrenewal at least
ninety (90) days prior to the end of the Initial Term (ii) after the end of the
Initial Term, by providing one hundred twenty (120) days notice, (iii) by mutual
agreement of the parties, or (iv) for "Cause," as defined below, upon the
provision of sixty (60) days advance written notice by the party alleging cause.
For purposes of this Section 5, "Cause" shall mean (a) a material breach of
this Agreement that has not been remedied for thirty (30) days following written
notice of such breach from the non-breaching party; (b) a final, unappealable
judicial, regulatory or administrative ruling or order in which the party to be
terminated has been found guilty of criminal or unethical behavior in the
conduct of its business; or (c) financial difficulties on the part of the party
to be terminated which are evidenced by the authorization or commencement of, or
involvement by way of pleading, answer, consent or acquiescence in, a voluntary
or involuntary case under Title 11 of the United States Code, as from time to
time is in effect, or any applicable law, other than said Title 11, of any
jurisdiction relating to the liquidation or reorganization of debtors or to the
modification or alteration of the rights of creditors.
Notwithstanding the foregoing termination provisions, following any such
termination, in the event that BISYS in fact continues to perform any one or
more of the services contemplated by this Agreement (or any Schedule or exhibit
hereto) with the consent of the Administrator, the provisions of this Agreement,
including without limitation the provisions dealing with compensation and
indemnification, shall continue in full force and effect. Fees and out-of-pocket
expenses incurred by BISYS but unpaid by the Trust or the Administrator upon
such termination shall be immediately due and payable upon and notwithstanding
such termination. BISYS shall be entitled to collect from the Trust or the
Administrator, in addition to the fees and expenses provided in the Section 3
and 4 of this Agreement, the amount of all of BISYS' reasonable cash
3
disbursements in connection with BISYS' activities in effecting such
termination, including without limitation, the delivery to the Trust or the
Administrator, and/or other parties of the Funds' property, records, instruments
and documents.
If, for any reason other than (i) nonrenewal, (ii) mutual agreement of the
parties or (iii) "Cause" for termination of BISYS hereunder, BISYS' services are
terminated hereunder, BISYS is replaced as sub-administrator, or if a third
party is added to perform a substantive portion of the sub-administration
services to be provided by BISYS under this Agreement (excluding any Sub Agent
appointed as provided in Section 2 hereof), then the Administrator shall make a
one-time cash payment, in consideration of the fee structure and services to be
provided under this Agreement, and not as a penalty, to BISYS equal to the
balance that would be due BISYS for its services hereunder during (x) the next
twelve (12) months or (y) if less than twelve (12), the number of months
remaining in the then-current term of this Agreement, assuming for purposes of
the calculation of the one-time payment that the fees that would be earned by
BISYS for each month under this Agreement shall be based upon the fees payable
to BISYS monthly during the twelve (12) months prior to the date that services
terminate, BISYS is replaced or a third party is added.
In the event the Trust or any Fund is merged into another legal entity in
part or in whole pursuant to any form of business reorganization or is
liquidated in part or in whole prior to the expiration of the then-current term
of this Agreement, the parties acknowledge and agree that the liquidated damages
provision set forth above shall be applicable in those instances in which BISYS
is not retained to provide services consistent with this Agreement, including
the number of accounts subject to such services. The one-time cash payment
referenced above shall be due and payable on the day prior to the first day in
which services are terminated, BISYS is replaced or a third party is added.
The parties further acknowledge and agree that, in the event services are
terminated, BISYS is replaced, or a third party is added, as set forth above,
(i) a determination of actual damages incurred by BISYS would be extremely
difficult; and (ii) the liquidated damages provision contained herein is
intended to adequately compensate BISYS for damages incurred and is not intended
to constitute any form of penalty.
6. STANDARD OF CARE; UNCONTROLLABLE EVENTS; LIMITATION OF LIABILITY.
BISYS shall use reasonable professional diligence in the performance of
services under this Agreement, but shall not be liable to the Trust or the
Administrator for any action taken or omitted by BISYS in the absence of bad
faith, willful misfeasance, negligence or reckless disregard by it of its
obligations and duties. The duties of BISYS shall be confined to those expressly
set forth herein, and no implied duties are assumed by or may be asserted
against BISYS hereunder.
BISYS shall maintain adequate and reliable computer and other equipment
necessary or appropriate to carry out its obligations under this Agreement. Upon
the
4
Administrator's reasonable request, BISYS shall provide supplemental information
concerning the aspects of its disaster recovery and business continuity plan
that are relevant to the services provided hereunder. Notwithstanding the
foregoing or any other provision of this Agreement, BISYS assumes no
responsibility hereunder, and shall not be liable for, any damage, loss of data,
delay or any other loss whatsoever caused by events beyond its reasonable
control. Events beyond BISYS' reasonable control include, without limitation;
force majeure events. Force majeure events include natural disasters, actions or
decrees of governmental bodies, and communication lines failures that are not
the fault of either party. In the event of force majeure, computer or other
equipment failures or other events beyond its reasonable control, BISYS shall
follow applicable procedures in its disaster recovery and business continuity
plan and use all commercially reasonable efforts to minimize any service
interruption. Nothing contained herein, however, shall relieve BISYS for
responsibility for the acts or omissions to act of its employees, agents,
Sub-Agents (provided such Sub-Agents have been selected by BISYS rather than the
Trust) if such acts or omissions to act involve the bad faith, willful
misfeasance, negligence or reckless disregard of its duties hereunder.
BISYS shall provide the Administrator, at such times as the Administrator
may reasonably request, copies of reports rendered by independent public
accountants on the internal controls and procedures of BISYS relating to the
services provided by BISYS under this Agreement.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO EVENT
SHALL BISYS, ITS AFFILIATES OR ANY OF ITS OR THEIR DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS OR SUBCONTRACTORS BE LIABLE FOR EXEMPLARY, PUNITIVE, SPECIAL,
INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, OR LOST PROFITS, EACH OF WHICH IS
HEREBY EXCLUDED BY AGREEMENT OF THE PARTIES REGARDLESS OF WHETHER SUCH DAMAGES
WERE FORESEEABLE OR WHETHER A PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.
7. LEGAL ADVICE.
BISYS May notify the Administrator if BISYS reasonably determines that it
is in need of the advice of counsel to the Administrator with regard to BISYS'
responsibilities and duties pursuant to this Agreement. BISYS may rely upon the
advice of counsel to the Administrator; however, this Agreement shall not
obligate counsel to the Administrator to render such advice. After so notifying
the Administrator, if BISYS cannot obtain the advice of counsel to the
Administrator within a reasonable period of time, BISYS shall be entitled to
seek, receive and act upon advice of legal counsel of its reasonable choosing at
the reasonable expense of the Administrator unless relating to a matter
involving BISYS' willful misfeasance, bad faith, negligence or reckless
disregard of BISYS' responsibilities and duties hereunder. BISYS shall in no
event be liable to the Administrator or any Fund or any shareholder or
beneficial owner of the Administrator for any action reasonably taken pursuant
to legal advice rendered in accordance with this paragraph.
5
8. INSTRUCTIONS / CERTAIN PROCEDURES, ETC.
BISYS shall be protected in acting upon any document that it reasonably
believes to be genuine and to have been signed or presented by the proper person
or persons. BISYS will not be held to have notice of any change of authority of
any officers, employees or agents of the Trust or the Administrator until
receipt of actual notice thereof from the Trust or the Administrator.
As to the services to be provided hereunder, BISYS may rely conclusively
upon the terms of the relevant then-current Prospectuses and Statements of
Additional Information of the Funds, to the extent that such services are
described therein unless BISYS receives written instructions to the contrary in
a timely manner from Administrator.
The parties hereto may amend any procedures adopted, approved or set forth
herein by written agreement as may be appropriate or practical under the
circumstances, and BISYS may reasonably assume that any special procedure which
has been approved by an executive officer of the Funds (other than an officer or
employee of BISYS or its affiliates) does not conflict with or violate any
requirements of the Trust's Declaration of Trust, By-Laws or then-current
Prospectus.
9. INDEMNIFICATION.
The Administrator agrees to indemnify, defend and hold harmless BISYS, its
employees, agents, directors, officers and nominees from and against any claims,
demands, actions, suits, judgments, liabilities, losses, damages, costs,
charges, counsel fees and other expenses including reasonable investigation
expenses (collectively, "Losses") resulting directly and proximately from BISYS'
performance of services under this Agreement or based, if applicable, upon
BISYS' reasonable reliance on information, records, instructions or requests
pertaining to services hereunder, that are given or made to BISYS by the
Administrator, the Trust, or other authorized agents of the Funds with which
BISYS must interface in providing services; provided that this indemnification
shall not apply to actions OR omissions of BISYS involving bad faith, willful
misfeasance, negligence or reckless disregard by it of its obligations and
duties.
BISYS shall indemnify, defend, and hold harmless the Administrator, and its
employees, directors, officers, agents and nominees from and against Losses
resulting directly and proximately from BISYS' willful misfeasance, bad faith or
negligence in the performance of, or the reckless disregard of, its duties or
obligations hereunder.
The indemnification rights hereunder shall include the right to reasonable
advances of defense expenses in the event of any pending or threatened
litigation with respect to which indemnification hereunder may ultimately be
merited. In order that the indemnification provisions contained herein shall
apply, however, it is understood that if in any case a party may be asked to
indemnify or hold the other party harmless, the indemnifying party shall be
fully and promptly advised of all pertinent facts concerning the situation in
question, and it is further understood that the indemnified party will use
6
all reasonable care to identify and notify the indemnifying party promptly
concerning any situation which presents or appears likely to present the
probability of such a claim for indemnification against the indemnifying party,
but failure to do so in good faith shall not affect the rights hereunder except
to the extent the indemnifying party is materially prejudiced thereby. As to any
matter eligible for indemnification, an indemnified party shall act reasonably
and in accordance with good faith business judgment and shall not effect any
settlement or confess judgment without the consent of the indemnifying party,
which consent shall not be withheld or delayed unreasonably.
The indemnifying party shall be entitled to participate at its own expense
or, if it so elects, to assume the defense of any suit brought to enforce any
claims subject to this indemnity provision. If the indemnifying party elects to
assume the defense of any such claim, the defense shall be conducted by counsel
chosen by it and reasonably satisfactory to the indemnified party. In the event
that the indemnifying party elects to assume the defense of any suit and retain
counsel, the indemnified party shall bear the fees and expenses of any
additional counsel retained by it. An indemnifying party shall not effect any
settlement without the consent of the indemnified party (which shall not be
withheld or delayed unreasonably by the indemnified party) unless such
settlement imposes no liability, responsibility or other obligation upon the
indemnified party and relieves it of all fault. If the indemnifying party does
not elect to assume the defense of suit, it will reimburse the indemnified party
for the reasonable fees and expenses of any counsel retained by the indemnified
party. The indemnity and defense provisions set forth herein shall indefinitely
survive the termination of this Agreement.
10. RECORD RETENTION AND CONFIDENTIALITY.
BISYS shall keep and maintain all books and records which are customary or
which are required to be kept in connection with BISYS' services pursuant to
applicable statutes, rules and regulations, including without limitation Rules
31a-1 and 31a-2 under the Investment Company Act of 1940, as amended (the "1940
Act"). BISYS further agrees that all such books and records shall be the
property of the Trust and to make such books and records available for
inspection by the Trust or the Administrator at reasonable times or by the
Commission promptly.
BISYS shall otherwise keep confidential all books and records relating to
the Trust and its shareholders, except when (i) disclosure is required by law,
(ii) BISYS is advised by counsel that it may incur liability for failure to
make a disclosure, (iii) BISYS is requested to divulge such information by
duly-constituted authorities or court process, (iv) BISYS is requested to make a
disclosure by a shareholder or shareholder's agent with respect to information
concerning an account as to which such shareholder has either a legal or
beneficial interest and a legal right to such information at such time
consistent with the Fund's Declaration of Trust, Prospectus and applicable law,
or (v) as requested or authorized by the Administrator or the Trust (including
pursuant to the Trust's policies and procedures). BISYS shall provide the
Administrator with reasonable advance notice of disclosure pursuant to items
(i) - (iii) of the previous sentence, to the extent reasonably practicable.
7
With respect to any category of administration services that BISYS performs
jointly with the Administrator, the Administrator shall provide clear
instructions as to the scope of the specific services to be provided by BISYS;
the commencement date (and, if applicable, termination date) for rendering such
services; and the location (i.e. whether at the offices of the Administrator or
BISYS) where the books and records related thereto shall be maintained.
11. RETURN OF RECORDS.
BISYS shall promptly upon the Administrator's demand, turn over to the
Administrator and cease to retain BISYS' files, records and documents created
and maintained by BISYS pursuant to this Agreement which are no longer needed by
BISYS in the performance of its services or for its legal protection. If not so
turned over to the Administrator, such documents and records shall be retained
by BISYS for six (b) years from, the year of creation. At the end of such
six-year period, such records and documents shall be turned over to the
Administrator unless the Administrator authorizes in writing the destruction of
such records and documents.
12. REPRESENTATIONS AND WARRANTIES OF THE ADMINISTRATOR
The Administrator represents and warrants to BISYS that:
(a) The Trust is a trust duly incorporated and validly existing under
the Commonwealth of Massachusetts, the Administrator is a
corporation duly incorporated and validly existing under the laws
of the State of Colorado, and the Administrator has full capacity
and authority to enter into this Agreement and to carry out its
obligations under the Administration Agreement and hereunder with
respect to the Trust;
(b) It and the Trust have all necessary authorizations, licenses and
permits to carry out its business as currently conducted;
(c) It and the Trust are in compliance in all material respects with
all laws and regulations applicable to its business and
operations;
(d) This Agreement has been duly authorized by the Administrator and
the Trust and, when executed and delivered by the Administrator,
will constitute a legal, valid and binding obligation of the
Administrator, enforceable against the Administrator in
accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other laws of general application
affecting the right and remedies of creditors and secured
parties; and
(e) The Administrator represents and warrants that it has presented
this Agreement to, together with any information requested by,
the Board of Trustees of the Trust, and the Board of Trustees of
the Trust has approved this Agreement. The Administrator shall
8
provide BISYS with a copy of such approval prior to the effective
date of this Agreement.
13. REPRESENTATIONS AND WARRANTIES OF BISYS.
BISYS represents and warrants to the Administrator that:
(a) It is a corporation duly incorporated and validly existing under
the laws of the state of Ohio, and has full capacity and
authority to enter into this Agreement and to carry out its
obligations hereunder;
(b) It has all necessary authorizations, licenses and permits to
carry out its business as currently conducted;
(c) It is, and shall continue to be, in compliance in all material
respects with all provisions of law applicable to it in
connection with its services hereunder;
(d) The various procedures and systems which it has implemented with
regard to safekeeping from loss or damage attributable to fire,
theft or any other cause of the blank checks, records, and other
data and BISYS' equipment, facilities, and other property used in
the performance of its obligations hereunder are reasonable and
adequate and that it will make such changes therein from time to
time as are reasonably required for the secure performance of its
obligations hereunder; and
(e) This Agreement has been duly authorized by BISYS and, when
executed and delivered by BISYS, will constitute a legal, valid
and binding obligation of BISYS, enforceable against BISYS in
accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium and other laws of general application
affecting the right and remedies of creditors and secured
parties.
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, ALL REPRESENTATIONS AND
WARRANTIES, INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES REGARDING QUALITY,
SUITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE
(IRRESPECTIVE OF ANY COURSE OF DEALING, CUSTOM OR USAGE OF TRADE) CONCERNING THE
SERVICES OR ANY GOODS PROVIDED INCIDENTAL TO THE SERVICES PROVIDED UNDER THIS
AGREEMENT BY BISYS ARE COMPLETELY DISCLAIMED.
14. INSURANCE.
BISYS shall maintain a fidelity bond covering larceny and embezzlement and
an insurance policy with respect to directors and officers errors and omissions
coverage, in
9
amounts that are appropriate in light of its duties and responsibilities
hereunder. Upon the request of the Administrator, BISYS shall provide evidence
that coverage is in place. BISYS shall notify the Administrator should its
insurance coverage with respect to professional liability or errors and
omissions coverage be reduced or canceled. Such notification shall include the
date of cancellation or reduction and the reasons therefore. BISYS shall notify
the Administrator promptly of any material claims against it with respect to
services performed under this Agreement, whether or not they may be covered by
insurance, and shall notify the Administrator promptly should the total
outstanding claims made by BISYS under its insurance coverage materially impair,
or threaten to materially impair, the adequacy of its coverage.
15. INFORMATION TO BE FURNISHED BY THE ADMINISTRATOR.
The Administrator will furnish to BISYS the following upon request, as
amended and current as of the Effective Date:
(a) A copy of the Declaration of Trust of the Trust and any
amendments thereto;
(b) A copy of the Trust's By-laws and any amendments thereto;
(c) A copy of the resolutions of the Board regarding (i) approval of
this Agreement and authorization for the Administrator to
instruct BISYS hereunder; and (ii) authorization of BISYS to act
as sub-administrator for the Trust; and
(d) A certified list of all officers of the Funds, and any other
persons (who may be associated with Administrator or any other
entity), together with specimen signatures of those officers and
other persons, who (except as otherwise provided herein to the
contrary) shall be authorized to instruct BISYS in all matters.
16. INFORMATION FURNISHED BY BISYS.
BISYS will furnish to the Administrator upon request, evidence of the
following:
(a) Approval of this Agreement by BISYS, and authorization of a
specified officer of BISYS to execute and deliver this Agreement;
and
(b) Authorization of BISYS to act as Sub-Administrator for the Funds.
17. COMPLIANCE WITH LAWS.
Except for information which is the obligation of BISYS as set forth in
Section 10 hereof, and except as provided in the services listed in the
schedules hereto which call for information to be provided by BISYS for
inclusion in the Prospectus, the Administrator assumes full responsibility for
the preparation, contents, and distribution of each
10
Prospectus of the Funds in compliance with all applicable requirements of the
Securities Act of 1933, as amended (the "1933 Act"), the 1940 Act, and any other
laws, rules and regulations of governmental authorities having jurisdiction.
BISYS shall have no obligation to take cognizance hereunder of laws relating to
the sale of Shares. The Administrator represents and warrants that all Shares of
the Funds that are offered to the public are covered by an effective
registration statement under the 1933 Act and the 1940 Act.
18. NOTICES.
Any notice provided hereunder shall be sufficiently given when sent by
registered or certified mail to the party required to be served with such notice
at the following address: if to Administrator, to 000 XXX Xxxxxxxxx, 00xx Xxxxx,
Xxxxxxxxx Xxxxxxx, Xxxxxxxx 00000, Attn: General Counsel, and if to BISYS, to it
at 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000; Attn: President, or at such other
address as such party may from time to time specify in writing to the other
party pursuant to this Section.
19. ASSIGNMENT.
This Agreement and the rights and duties hereunder shall not be assignable
by either of the parties hereto except by the specific written consent of the
other party. This Section 19 shall not apply to the appointment of a Sub-Agent
pursuant to Section 2 hereof. This Agreement shall be binding upon, and shall
inure to the benefit of, the parties hereto and their respective successors and
permitted assigns.
20. GOVERNING LAW.
This Agreement shall be governed by and provisions shall be construed in
accordance with the laws of the State of Ohio and the applicable provisions of
the 1940 Act. To the extent that the applicable laws of the State of Ohio, or
any of the provisions herein, conflict with the applicable provisions of the
1940 Act, the latter shall control.
21. ACTIVITIES OF BISYS.
The services of BISYS rendered to the Administrator hereunder are not to be
deemed to be exclusive. BISYS is free to render such services to others and to
have other businesses and interests. It is understood that Trustees, officers,
employees and Shareholders of the Administrator and/or the Trust are or may be
or become interested in BISYS, as officers, employees or otherwise, and that
partners, officers and employees of BISYS are or may be or become similarly
interested in the Trust or the Administrator, and that BISYS may be or become
interested in the Trust as a shareholder or otherwise.
22. PRIVACY.
Nonpublic personal financial information relating to consumers or customers
of the Trust provided by, or at the direction of the Administrator to BISYS, or
collected or retained by BISYS in the course of performing its duties as
sub-administrator, shall be considered confidential information. BISYS shall not
give, sell or in any way transfer
11
such confidential information to any person or entity, other than affiliates of
BISYS involved in servicing the Funds except at the direction of the
Administrator or the Funds or as required or permitted by law. BISYS represents,
warrants and agrees that it has in place and will maintain physical, electronic
and procedural safeguards reasonably designed to protect the security,
confidentiality and integrity of, and to prevent unauthorized access to or use
of records and information relating to consumers or customers of the Funds. The
Administrator represents to BISYS that the Trust has adopted a Statement of its
privacy policies and practices as required by the Commission's Regulation S-P
and agrees to provide BISYS with a copy of that statement annually.
23. MISCELLANEOUS.
(a) Paragraph headings in this Agreement are included for convenience
only and are not to be used to construe or interpret this
Agreement.
(b) This Agreement constitutes the complete agreement of the parties
hereto as to the subject matter covered by this Agreement, and
supercedes all prior negotiations, understandings and agreements
bearing upon the subject matter covered herein.
(c) This Agreement may be executed in counterparts, each of which
shall be an original but all of which, taken together, shall
constitute one and the same agreement.
(d) No amendment to this Agreement shall be valid unless made in
writing and executed by both parties hereto.
12
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed all as of the day and year first above written.
ICON ADVISERS, INC.
By:
Name
Title:
BISYS FUND SERVICES OHIO, INC.
By: /s/ [ILLEGIBLE]
-------------------------------
Name: /s/ [ILLEGIBLE]
-----------------------------
Title: President
----------------------------
13
SCHEDULE A
SUB-ADMINISTRATION AGREEMENT
BETWEEN
ICON ADVISERS, INC.
AND
BISYS FUND SERVICES OHIO, INC.
SUB-ADMINISTRATION SERVICES
LEGAL SERVICES
1. Prepare, subject to review by counsel to Administrator and the Trust, (i)
the annual update to the Trust's registration statement on Form N- l A,
(ii) other amendments to the Trust's registration statement and supplements
to its Prospectus and Statement of Additional Information, and (iii)
Notices of Annual or Special Meetings of shareholders of the Trust and
proxy materials relating thereto, and file any of the foregoing with the
Securities and Exchange Commission (the "SEC") upon the request of counsel
to the Administrator or counsel to the Trust.
2. Assist with the design, development, and operation of the Funds, including
new classes, investment objectives, policies and structure, and provide
consultation related to legal and regulatory aspects of the establishment,
maintenance, and liquidation or dissolution of Funds.
3. Obtain and maintain fidelity bonds and directors and officers/errors and
omissions insurance policies for the Trust in accordance with Rules 17g-1
and 17d-1 under the 1940 Act at the expense (except as otherwise provided
in the Agreement) of the Trust and Funds and file the fidelity bonds and
any notices with the SEC as required under the 1940 Act, to the extent such
bonds and policies are approved by the Board.
4. Maintain corporate records on behalf of the Trust, including, but not
limited to, minute books, the Declarations of Trust and By-Laws for the
Trust.
5. Provide assistance and guidance to the Trust with respect to matters
governed by or related to regulatory requirements and developments
including: monitoring regulatory and legislative developments which may
effect the Trust, and assisting in strategic planning in response thereto;
assisting the Trust and providing on-site personnel in responding to and
providing documents for routine regulatory examinations or investigations;
and coordinating with and taking instructions from counsel to the Trust in
response to such routine or non-routine regulatory
14
matters. The assistance to be provided with respect to SEC inspections
includes (i) rendering advice regarding proposed responses (ii) compiling
data and other information in response to SEC requests for information and
(iii) communicating with the Administrator and the Trust to provide status
updates. In addition, BISYS will provide appropriate assistance with
respect to audits conducted by the Fund's independent accountants including
compiling data and other information as necessary.
6. Manage the preparation for Board meetings by (i) coordinating Board book
production and distribution, (ii) subject to review and approval by counsel
to the Administrator and Trust counsel, preparing Board agendas and
minutes, (iii) preparing the relevant sections of the Board materials
required to be prepared by BISYS, (iv) assist in gathering and coordinating
special materials related to annual contract renewals and approval of rule
12b-1 plans and related matters for and as directed by counsel to the
Administrator, the Trustees or Trust counsel, (v) attending Board meetings
and recording the minutes, and (vi) performing such other Board meeting
functions as shall be agreed by the parties in writing.
7. Coordinate formulating and filing of the Funds' voting records (as approved
by the Administrator) on Form N-PX.
8. Review proxy statements prepared by counsel.
9. Prepare and file amendments to the Declaration of Trust/Articles of
Incorporation and amendments to the By-Laws, as necessary.
10. Prepare for and conduct shareholder meetings, including, but not limited
to, solicitation of shareholders, preparation of scripts, oversight of the
tabulation of votes, recording minutes and preparation of reports that
reflect voting results.
11. Review Account Applications and Shareholder Agreements.
COMPLIANCE SERVICES
12. Coordinate and prepare, with the assistance and approval of the
Administrator, counsel and officers, drafts of communications to
shareholders of record of the Funds ("Shareholders"), including the annual
and semiannual report to Shareholders (including financial statement
preparation and full footnote disclosure all in accordance with industry
standards); prepare drafts of the certified semi-annual report for each
Fund; prepare and file the final certified versions thereof on Form N-CSR;
prepare and file the Trust's Form N-SAR; and file all required notices
pursuant to Rule 24f-2.
15
13. Monitor and advise the Trust and its Funds on their regulated investment
company status under the Internal Revenue Code of 1986, as amended. In
connection with the foregoing, prepare and send quarterly reminder letters
related to such status, and prepare quarterly compliance checklist for use
by investment adviser(s) if requested.
14. Assist the Trust in developing portfolio compliance procedures for each
Fund, and provide daily and periodic compliance monitoring services
incorporating certain of those procedures, which will include, among other
matters, compliance with investment restrictions imposed by the 1940 Act
each Fund's investment objective, defined investment policies, and
restrictions, tax diversification, and distribution and income
requirements, provided such are determinable based upon the Fund's
accounting records. In connection with the foregoing, review quarterly
compliance reports that are prepared by the investment adviser(s), and
notify appropriate Fund officers and the Administrator of xxxx-to-market
issues pursuant to Board-approved procedures. BISYS will also provide the
Board with quarterly results of compliance reviews.
15. Provide the following additional services to assist the Trust in
connection with its obligations under Rule 38a-1 under the 1940 Act: (a)
perform risk-based testing and an annual assessment of the compliance
procedures of each BISYS service group, as applicable, (i.e., fund
accounting, administration) that provides services to the Trust and of any
BISYS affiliate acting as the Trust's distributor; (b) provide information
reasonably requested by the Board in connection with the Board's
determination regarding the adequacy and effectiveness of the compliance
procedures described in (a) above; and (c) provide reports to the Trust's
Chief Compliance Officer regarding the risk-based testing and annual
assessment described in (a) above.
16. File holdings reports on Form N-Q as required at the end of the first and
third fiscal quarters of each year.
17. Prepare quarterly brokerage allocation compliance checklist and supporting
documentation for use by investment adviser(s), as requested.
18. Provide on-site compliance training for investment advisory personnel, as
requested.
16
TAX SERVICES
19. Coordinate the preparation of all federal tax returns (Federal Form 1120
RIC U.S. Income Tax Return for Regulated Investment Companies, and Form
8613 - Return of Excise Tax on Undistributed Income of Regulated Investment
Companies) with the Trust's auditors, who will review and sign tax returns.
Prepare and file any applicable State income tax returns. File the
completed Federal returns, if requested. Prepare tax disclosures required
for the Funds' annual reports.
20. Review the underlying portfolio investments of each Fund for any book/tax
differences and prepare workpapers to account for these items.
21. Review portfolios for Passive Foreign Investment Companies and make any
necessary xxxx-to-market adjustments.
22. Monitor Funds' compliance with all tests required under federal tax law to
maintain Funds' status as a regulated investment company.
23. Calculate the required income and capital gain distributions in accordance
with federal tax law. In addition, maintain a dividend calendar for each
Fund to ensure that distributions are made within prescribed time limits.
All review all dividend distributions to ensure that they are fully
deductible under federal tax law.
24. Coordinate the preparation and distribution of year-end tax reporting
information with the Trust's transfer agent, including preparation of all
supplemental information that shareholders require to prepare their federal
and state income tax returns.
25. Prepare and distribute the required year-end information returns to all of
the Trust's service providers and Trustees.
26. Assist the Administrator in preparing for upcoming distributions including
tax lot selection and wash sale monitoring.
27. Provide tax consulting services related to structuring fund mergers,
acquisitions and liquidation and provide regulatory updates on industry
changes.
OTHER ADMINISTRATIVE SERVICES
28. Assist with and coordinate the layout and printing of prospectuses and the
Funds' semi-annual and annual reports to Shareholders.
29. Coordinate the distribution of prospectuses, supplements, proxy materials
and reports to Shareholders; and coordinate the solicitation and
17
tabulation of proxies in connection with the annual meeting of Shareholders
each year, if one is held.
30. Coordinate the implementation of service arrangements covered by
Shareholder Service Plans adopted by the Board with the financial
institutions that serve, or propose to serve, as shareholder services
agents thereunder ("Shareholder Service Agents"); review the qualifications
of Shareholder Service Agents to serve as such under the relevant
Shareholder Service Plan; coordinate and assist in the Trust's execution
and delivery of Shareholder Service Agreements; report to the Board
regarding amounts paid under Shareholder Service Agreements and the nature
of Services provided by the Shareholder Service Agents thereunder; and
maintain appropriate records in connection with the foregoing.
31. Administer contracts on behalf of the Trust with, among others, the Trust's
investment adviser, distributor, custodian, transfer agent and fund
accountant.
32. Furnish advice and recommendations with respect to other aspects of the
business and affairs of the Funds as the Trust shall request and the
parties shall agree in writing.
18
SCHEDULE B
SUB-ADMINISTRATION AGREEMENT
BETWEEN
ICON ADVISERS, INC.
AND
BISYS FUND SERVICES OHIO, INC.
SERVICE STANDARDS
Pursuant to Section 2 of this Agreement, BISYS has agreed to perform the
services described in this Agreement in accordance with the service standards
set forth on the following pages of this Schedule B. The standards, deadlines
and financial penalties included in this Schedule B or otherwise agreed to from
time to time will remain in effect during the term of this Agreement unless
subsequently modified or terminated following a review and the written consent
of the parties.
In the event BISYS fails to meet a service standard in any particular month,
quarter or year, as the case may be, BISYS agrees to take appropriate corrective
measures within the following period in order to be in compliance with the
appropriate standard at the end of such period. The foregoing requirement shall
not apply in those instances in which the BISYS' failure to meet a service
standard was due to circumstances beyond its control. In the event BISYS fails
to meet a service standard for a particular item for reasons within its control,
the Administrator will be entitled to a fee reduction as listed in the table
below. Any determination by BISYS in a particular instance to agree to a
financial or other penalty provided for in this Schedule B, shall be without
prejudice to BISYS and shall not be construed as an admission of wrongdoing or a
waiver of any rights generally under this Agreement.
ITEM STANDARD FEE REDUCTION
---------------------- ----------------------------------- -------------------
LEGAL SERVICES
Registration
Statements
- Prepare Annual Prepare draft 485(a) filings for $1,000
Updates review within 20 calendar days
after Trust's fiscal year-end.
Prepare draft 485(b) filings for
review within 50 calendar days
after the Trust's fiscal year end.
19
- Review New Within pre-established timeframes As determined on a
Funds, N-14s & with client case-by-case basis
Other Filings
- 497 Filings 5 calendar days after N-lA $1,000
effectiveness
Prospectus & 2 - 4 business days after N-1A $1,000
Supplement Mailing effective date
Notify the transfer Within seven (7) business days of $200
agent and ADP of the being notified that record date has
record date for been set
shareholder meeting
Preparation of Draft 6 weeks prior to Board meeting $500
Board Meeting
Agenda
Preparation of Board 4 weeks prior to Board meeting $500
Resolutions
Mailing of Board Two full weekends prior to meeting $1,000
Meeting Materials
Preparation of Draft 45 calendar days after Board and $500
Board and Committee Committee meetings
Meeting Minutes
Shareholder
Meeting/Proxy
Statements
- Initial Set up of 7 business days prior to record $200
Proxy Solicitation date.
with
Tabulator/Mailing
Agent
Completion of By established mail date. $500
Mailing with
Proxy Solicitor
COMPLIANCE SERVICES
N-SARs Draft to Administrator by 53rd day $1,000
following the report date
20
Completed and filed with the SEC by $1,000
the 60th day following the report
date.
24f-2 Share Draft to Administrator by 85th $500
Registration calendar day following fiscal
year-end
File Form 24f-2 filing within 90 $500
days of fiscal year-end
Shareholder Report Filed with the SEC within 60 days $1,000
Preparation Cycle -- following the report date
Annual and
Semiannual Reports
- Draft Schedule of 17 days following the report date $500
Investments in
word or excel
format
- First Draft of 30 days following the report date $500
Financial
Statements in word
or excel format
- First draft of Notes 17 days following the report date $500
to Financial
Statements
(excluding tax
notes) in word or
excel format
- Draft 45 days following the report date $500
Certifications
Form N-Q Filed with the SEC within 60 days $1,000
following the report date
Draft Schedule of 30 days following the report date $500
Investments in
word or excel
format
- First draft of Notes 30 days following the report date $500
to Schedule of
Investments
- Draft 45 days following the report date $500
Certifications
21
Perform Daily
Compliance Checks:
- Specified SEC & $ 1:00 p.m. Mountain time on T+2 $200
Prospectus Checks
- Specified IRS Within 5 business after month end $200
Checks for those months that are not a
quarter-end
Notify the Trust of By 5:00 PM on date of detection $200
Issues Detected
Monthly Compliance Within 7 business days after $200
Checks month-end
Other Quarterly
Compliance Services
- IRS Qualification 10 business days prior to tax $500
Letters re: Sub- quarter-end
Chapter M
Qualification
- BISYS
Compliance 3 weeks prior to Board meeting $200
Representation
Letter
- Provide back-up By October 31 $500
and support for
Rule 38a-1
purposes
TAX SERVICES
Prepare Tax Within 40 days after end of $500
Disclosures for reporting period
Financial Statements
Federal and State Tax Within 120 days of tax year end $500
Returns
Review Investment Monthly, within 10 business days $200
Holding to Determine after the relevant month end
Whether Complex
Securities are Held
Tax Capital Gain/Loss Quarterly, within 10 business days $200
Position Review after the end of the relevant
quarter
22
SCHEDULE C
SUB-ADMINISTRATION AGREEMENT
BETWEEN
ICON ADVISERS, INC.
AND BISYS FUND SERVICES
OHIO, INC.
FEE SCHEDULE
In consideration of services rendered and expenses assumed pursuant to this
Agreement, the Administrator will pay BISYS on the first business day of each
month:
ASSET-BASED FEE:
An asset-based fee calculated on the average net asset value of all Funds, with
the fee rates applied incrementally to assets at the respective levels indicated
below, and accrued daily, as follows:
AVERAGE DAILY NET ASSETS OF ALL FUNDS ANNUAL RATE OF FEE
------------------------------------- ------------------
Up to the first $1.75 Billion 0.0250% (2.5 basis points)
Over $1.75 Billion 0.0150% (1.5 basis points)
LEGAL SERVICES FEE
In addition to the above fees, BISYS will receive an additional fee of $125,000
annually, with respect to the legal services rendered hereunder.
N-Q FILING FEES
In addition to the above fees, BISYS will receive an additional fee of $1,500
per Fund per N-Q filed on its behalf.
TAX SERVICES FEE
In addition to the above fees, BISYS will receive an additional fee of $2,000
per domestic Fund and $2,500 per global or international Fund with respect to
the tax return services rendered hereunder.
In addition to the foregoing service fees, a charge of $50 per security will be
charged as an expense with respect to each security held by the Funds that is
included within the
23
database of securities that pay dividends from "qualified foreign corporations"
and that are reportable as qualified dividends.
CPI ADJUSTMENT
All fixed and minimum fees set forth in this schedule shall be increased
annually commencing on the one-year anniversary date of the Effective Date by
the percentage increase in consumer prices during the most recent 12 months for
services as measured by the United States Consumer Price Index entitled "All
Services Less Rent of Shelter" or a similar index should such index no longer be
published; provided, however that this adjustment shall be reduced or eliminated
to the extent of any increase in the dollar amount of Asset-Based Fee in any
calendar year, determined as per above, from the amount of the Asset-Based Fee
in the immediately preceding calendar year.
EXPENSES
Except with respect to the per-security charge set forth under "Tax Services,"
expenses are not included in the above fees and shall also be paid to BISYS in
accordance with the provisions of this Agreement.
24
