INVESTMENT SUB-ADVISORY AGREEMENT
AGREEMENT made as of this 18th day of December, 1996, by and among Meridian
Investment Management Corporation, a Colorado corporation (the "Adviser"),
Wellington Management Company, LLP, a Massachusetts limited liability
partnership (the "Sub-Adviser" or "Wellington Management") and the ICON Funds, a
Massachusetts business trust (the
"Company").
WHEREAS, the Company is registered as an open-end management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Adviser has entered into an Investment Advisory Agreement dated
October 9, 1996 (the "Advisory Agreement") with the Company, pursuant to which
the Adviser serves as investment adviser to the ICON Short-Term Fixed Income
Fund (the "Fund"); and
WHEREAS, the Adviser and the Company each desire retain the Sub-Adviser to
provide investment management services to the Fund, and the Sub-Adviser is
willing to render such investment management services.
NOW, THEREFORE, the parties hereto agree as follows:
1
(a)
Subject to supervision by the Adviser and the Company's Board of Trustees, the
Sub-Adviser shall manage the investment operations of the Fund and the
composition of the Fund's portfolio, including the purchase, retention and
disposition thereof, in accordance with the Fund's Prospectus (such Prospectus
and the Statement of Additional Information, as currently in effect and as
amended or supplemented from time to time, being herein called the
"Prospectus"), and subject to the following:
(1)
The Sub-Adviser shall provide supervision of the Fund's investments and
determine from time to time what investments and securities will be
purchased, retained or sold by the Fund, and what portion of the costs
will be invested or held uninvested in cash.
(2)
In the performance of its duties and obligations under this Agreement,
the Sub-Adviser shall act in conformity with the Company's Certificate
of Incorporation and the Prospectus and with the instructions and
directions of the Adviser and of the Board of Trustees of the Company
and will conform to and comply with the requirements of the 1940 Act,
the Internal Revenue Code of 1986, as amended, and all other applicable
federal and state laws and regulations, as each is amended from time to
time.
(3)
The Sub-Adviser shall have full and complete discretion to establish
brokerage accounts with one or more brokers, dealers or other financial
intermediaries as Sub-Adviser may select in accordance with its
customary practices and procedures, including those which from time to
time may furnish to Sub-Adviser or its affiliates statistical and
investment research information and other services. Sub-Adviser will
place orders with or through such brokers, dealers or other financial
intermediaries in accordance with Wellington Management's Statement of
Policy on Brokerage Practices and the policy with respect to brokerage
set forth in the Fund's Registration Statement (as defined herein) or
as the Board of Trustees or the Adviser may direct from time to time,
in conformity with federal securities laws on occasions when the
Sub-Adviser deems the purchase or sale of a security to be in the best
interest of the Fund as well as other clients of the Sub-Adviser, it
may allocate such transactions in the manner it considers to be the
most equitable and consistent with its fiduciary obligation to the Fund
and to such other clients.
(4)
The Sub-Adviser shall maintain all books and records with respect to
the Fund's portfolio transactions required by subparagraphs (b)(5),
(6), (7), (9), (10) and (11) and paragraph (f) of Rule 31a-1 under the
1940 Act and shall render to the Company's Board of Trustees such
periodic and special reports as the Company's Board of Trustees may
reasonably request.
(5)
The Sub-Adviser shall provide the Fund's Custodian on each business day
with information relating to all transactions concerning the Fund's
assets and shall provide the Adviser with such information upon request
of the Adviser.
(6)
The investment management services provided by the Sub-Adviser under
this Agreement are not to be deemed exclusive and the Sub-Adviser shall
be free to render similar services to others, as long as such services
do not impair the services rendered to the Adviser or the Company.
(b)
Services to be furnished by the Sub-Adviser under this Agreement may be
furnished through the medium of any of the Sub-Adviser's partners, officers or
employees.
(c)
The Sub-Adviser shall keep the Fund's books and records required to be
maintained by the Sub-Adviser pursuant to paragraph 1(a) of this Agreement and
shall timely furnish to the Adviser all information relating to the
Sub-Adviser's services under this Agreement needed by the Adviser to keep the
other books and records of the Fund required by Rule 31a-1 under the 1940 Act.
The Sub-Adviser agrees that all records that it maintains on behalf of the Fund
are property of the
Fund and the Sub-Adviser will surrender promptly to the Fund any of such records
upon the Fund's request; provided, however, that the Sub-Adviser may retain a
copy of such records. The Sub-Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act any such records as are required to
be maintained by it pursuant to paragraph 1(a) of this Agreement.
2
The Adviser shall continue to have responsibility for all services to be
provided to the Fund pursuant to the Advisory Agreement and shall oversee and
review the Sub-Adviser's performance of its duties under this Agreement.
3
The Adviser has delivered to the Sub-Adviser copies of each of the following
documents and will deliver to it all future amendments and supplements, if any:
(a)
The Company's Master Trust Agreement (as in effect on the date of this Agreement
and as amended from time to time, herein called "Charter");
(b)
By-Laws of the Company (such By-Laws, as in effect on the date of this Agreement
and as amended from time to time, are herein called the "By-Laws");
(c)
Certified resolutions of the Company's Board of Trustees authorizing the
appointment of the Adviser and the Sub-Adviser with respect to the Fund, and
approving the form of this Agreement;
(d)
Registration Statement under the 1940 Act and the Securities Act of 1933, as
amended, on Form N-1A (the "Registration Statement"), as filed with the
Securities and Exchange Commission (the "Commission") relating to the Fund and
shares of the Fund's beneficial shares, and all amendments thereto;
(e)
Notification of Registration of the Company under the 1940 Act on Form N-8A as
filed with the Commission, and all amendments thereto; and
(f)
Prospectus of the Fund.
4
For the services to be provided by the Sub-Adviser pursuant to this Agreement,
the Adviser will pay the Sub-Adviser, and the Sub-Adviser agrees to accept as
full compensation therefore a sub-advisory fee payable on a quarterly basis,
based on the average month-end net assets of the Fund for each such calendar
quarter. The fee rate will be equal to one fourth of the annual rates as
follows:
Average Net Assets Annual Rate
------------------ -----------
On First $ 250 million 0.20%
On Next $ 250 million 0.15%
Over $ 500 million 0.125%
Notwithstanding the foregoing, the minimum fee payable to the Sub-Adviser on an
annual basis shall be $100,000. If Sub-Adviser shall serve for less than the
whole of any quarterly period, its compensation determined as provided herein
will be calculated and payable on a pro rata basis for the period of the
calendar quarter for which it has served as Sub-Adviser.
5
The Sub-Adviser shall not be liable for any error of judgment or for any loss
suffered by the Fund or the Adviser in connection with performance of its
obligations under this Agreement, except a loss resulting from a breach of
fiduciary duty with respect to the receipt of compensation for services (in
which case any award of damages shall be limited to the period and the amount
set forth in Section 36(b)(3) of the 1940 Act), or a loss resulting form willful
misfeasance, bad faith or negligence on the Sub-Adviser's part in the
performance of it duties or from reckless disregard of its obligations and
duties under this Agreement, except as may otherwise be provided under
provisions of applicable state law which cannot be waived or modified hereby.
6
This Agreement shall continue in effect for a period of more than two years from
December 18, 1996 only so long as continuance is specifically approved at least
annually in conformance with the 1940 Act; provided, however, that this
Agreement may be terminated (a) by the Fund at any time, without the payment of
any penalty, by the vote of a majority of Directors of the Company or by the
vote of a majority of the outstanding voting securities of such Fund, (b) by the
Adviser at any time, without the payment of any penalty, on not more than 60
days' nor less than 30 days' written notice to the other parties, or (c) by the
Sub-Adviser at any time, without the payment of any penalty, on 90 days' written
notice to the other parties. This Agreement shall terminate automatically and
immediately in the event of its assignment. As used in this Section 6, the terms
"assignment" and "vote of a majority of the outstanding voting securities" shall
have the respective meanings set forth in the 1940 Act and the rules and
regulations thereunder, subject to such exceptions as may be granted by the
Commission under the 1940 Act.
7
Nothing in this Agreement shall limit or restrict the right of any of the
Sub-Adviser's partners, officers, or employees to engage in any other business
or to devote his or her time and attention in part to the management or other
aspects of any business, whether of a similar or dissimilar
nature, nor limit or restrict the Sub-Adviser's right to engage in any other
business or to render services of any kind to any other corporation, firm,
individual or association.
8
During the term of this Agreement, the Adviser agrees to furnish the Sub-Adviser
at its principal office all Prospectus, proxy statements, reports to
stockholders, sales literature or other materials prepared for distribution to
stockholders of the Fund, the Company or the public that refer to the
Sub-Adviser. Such materials may be deemed to have been approved by Sub-Adviser
unless Sub-Adviser reasonably objects in writing within five business days (or
such other period as may be mutually agreed) after receipt thereof. The
Sub-Adviser's right to object to such materials is limited to the portions of
such materials that expressly relate to the Sub-Adviser, its services and its
clients. The Adviser agrees to use its reasonable best efforts to ensure that
materials prepared by its employees or agents or its affiliates that refer to
the Sub-Adviser or its clients in any way are consistent with those materials
previously approved by the Sub-Adviser as referenced in the first sentence of
this paragraph. Sales literature may be furnished to the Sub-Adviser by first
class or overnight mail, facsimile transmission equipment or hand delivery.
9
No provisions of this Agreement may be changed, waived, discharged or terminated
orally, but only by an instrument in writing signed by the party against which
enforcement of the change, waiver, discharge or termination is sought, and no
amendment of this Agreement shall be effective until approved by the vote of the
majority of the outstanding voting securities of the Fund.
10
This Agreement shall be governed by the laws of the Commonwealth of
Massachusetts; provided, however, that nothing herein shall be construed as
being inconsistent with the 1940 Act.
11
This Agreement embodies the entire agreement and understanding among the parties
hereto, and supersedes all prior agreements and understandings relating to this
Agreement's subject matter. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but such
counterparts shall, together, constitute only one instrument.
12
Should any part of this Agreement be held invalid by a court decision, statute,
rule or otherwise, the remainder of this Agreement shall not be affected
thereby. This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors.
13
Any notice, advice, or report to be given pursuant to this Agreement shall be
delivered or mailed:
To the Adviser at:
Meridian Investment Management Corporation
00000 Xxxx Xxxxxxxx Xxxx, Xxxxx XX
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxx
To Sub-Adviser at:
Wellington Management Company, LLP
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Legal Department
To the Company or the Fund at:
ICON Funds
c/o AmeriPrime Financial Services, Inc.
0000 Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxxxxxxxxxx
14
Where the effect of a requirement of the 1940 Act reflected in any provision of
this Agreement is altered by a rule, regulation or order of the Commission,
whether of special or general application, such provision shall be deemed to
incorporate the effect of such rule, regulation or order.
15
A copy of the Charter of the Company is on file with the Commonwealth of
Massachusetts, and notice is hereby given that this instrument is executed on
behalf of the Trustees of the Company as Trustees, and that the obligations of
this instrument are not binding upon any of the Trustees, officers, or
shareholders of the Company individually but binding only upon the assets and
property of the Company.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their officers designated below as of the day and year first written above.
Meridian Investment Management Corporation
By: \S\Xxxxxxx X. Xxxx
------------------
Title: President
------------------
Wellington Management Company, LLP
By: \S\Xxxxxx X. XxXxxxxxx
-------------------------------------
Title: President and Chief Executive Officer
-------------------------------------
ICON Funds
By: \S\Xxxxxxx X. Xxxx
------------------
Title: President
------------------
