EXHIBIT (d)(4)
EXPENSE LIMITATION AGREEMENT
ING FUNDS TRUST
THIS EXPENSE LIMITATION AGREEMENT, effective this 23rd day of
September, 2002, by and between ING Investments, LLC (the "Investment Manager")
and ING Funds Trust (the "Trust"), on behalf of each series of the Trust set
forth on Schedule A (each a "Fund," and collectively, the "Funds") as such
schedule may be amended from time to time to add additional series.
WHEREAS, the Trust is a Delaware business trust, and is registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), as an
open-end management company of the series type; and each Fund is a series of the
Trust; and
WHEREAS, the Trust and the Investment Manager 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 Trust and the Investment Manager have entered into
Investment Management Agreements (each a "Management Agreement"), pursuant to
which the Investment Manager provides investment management services to the
Funds for compensation based on the value of the average daily net assets of the
Funds; and
WHEREAS, the Trust and the Investment Manager have determined that it
is appropriate and in the best interests of each Fund and its shareholders to
maintain the expenses of each Fund at a level below the level to which each Fund
may normally 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 incurred by a class of the Fund in any fiscal year, including
but not limited to investment management fees payable to the Investment Manager,
but excluding interest, taxes, brokerage commissions, other investment-related
costs, extraordinary expenses such as litigation, other expenses not incurred in
the ordinary course of the Fund's business, and expenses of any counsel or other
persons or services retained by the Trust's trustees who are not "interested
persons," as that term is defined in the 1940 Act, of the Investment Manager
("Fund Operating Expenses"), exceed the Operating Expense Limit, as defined in
Section 1.2 below, such excess amount (the "Excess Amount") shall be the
liability of the Investment Manager.
1.2. Operating Expense Limit. The maximum Operating Expense Limit
in any fiscal year with respect to each class of each Fund shall be the amount
specified in Schedule A based on a percentage of the average daily net assets of
such class of the Fund.
1.3. Method of Computation. To determine the Investment Manager's
obligation with respect to the Excess Amount, each day the Fund Operating
Expenses for each class of a Fund shall be annualized. If the annualized Fund
Operating Expenses for any day of a class of a Fund exceed the Operating Expense
Limit for that class, the Investment Manager shall remit to the appropriate
class of the Fund an amount that, together with the waived or reduced investment
management fee, is sufficient to pay that day's Excess Amount. Any such amounts
remitted to 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 Trust may offset amounts owed to a Fund pursuant
to this Agreement against the advisory fee payable to the Investment Manager.
1.4. Year-End Adjustment. If necessary, on or before the last day
of the first month of each fiscal year, an adjustment payment shall be made by
the appropriate party in order that the amount of the investment management fees
waived or reduced and other payments remitted by the Investment Manager to each
class of a Fund with respect to the previous fiscal year shall equal the Excess
Amount.
2. Recoupment of Fee Waivers and Expense Reimbursements.
2.1. Recoupment. If on any day during which the Management
Agreement with respect to a Fund is in effect, the estimated annualized Fund
Operating Expenses of a class of such Fund for that day are less than the
Operating Expense Limit, the Investment Manager shall be entitled to recoup from
such class of the Fund the investment management fees waived or reduced and
other payments remitted by the Investment Manager to such class of the Fund
pursuant to Section 1 hereof (the "Recoupment Amount") during any of the
previous thirty-six (36) months, to the extent that such class' annualized
Operating Expenses plus the amount recouped equals, for such day, the Operating
Expense Limit provided in Schedule A, provided that such amount paid to the
Investment Manager will in no event exceed the total Recoupment Amount and will
not include any amounts previously recouped. Any such 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.
2.2. Year-End Adjustment. If necessary, on or before the last day
of the first month of each fiscal year, an adjustment payment shall be made by
the appropriate party in order that the actual Fund Operating Expenses of each
class of a Fund for the prior fiscal year (including any recoupment payments
hereunder with respect to such fiscal year) do not exceed the Operating Expense
Limit.
3. Term and Termination of Agreement.
This Agreement shall have an initial term with respect to each Fund
ending on the date indicated on Schedule A hereto, 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
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Investment Manager provides written notice of the termination of this Agreement
termination of this Agreement to a lead Independent Trustee within ninety (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
Trust, without payment of any penalty, upon written notice to the Investment
Manager at its principal place of business within ninety (90) days of the end of
the then-current term for a Fund.
4. Miscellaneous.
4.1. 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.
4.2. Interpretation. Nothing herein contained shall be deemed to
require a Fund or the Trust to take any action contrary to the Trust's
Declaration of Trust or By-Laws, or any applicable statutory or regulatory
requirement to which it is subject or by which it is bound, or to relieve or
deprive the Trust's Board of Trustees of its responsibility for and control of
the conduct of the affairs of the Trust or the Funds.
4.3. 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 with respect to a Fund or the 1940 Act,
shall have the same meaning as and be resolved by reference to such Management
Agreement or the 1940 Act.
4.4. 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 FUNDS TRUST
By: ________________________________
Name: Xxxxxx X. Naka
Title: Senior Vice President
ING INVESTMENTS, LLC
By: ________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President
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