CONFORMED SUBMISSION TYPE: 485APOS
PUBLIC DOCUMENT COUNT:
FILED AS OF DATE: 19990923
EFFECTIVENESS DATE: 19991122
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: ICON FUNDS
CENTRAL INDEX KEY: 0001025770
STANDARD INDUSTRIAL CLASSIFICATION: []
STATE OF INCORPORATION: MA
FISCAL YEAR END: 0930
FILING VALUES:
FORM TYPE: 485APOS
SEC ACT:
SEC FILE NUMBER: 333-14927
FILM NUMBER: 98767816
FILING VALUES:
FORM TYPE: 485APOS
SEC ACT:
SEC FILE NUMBER: 811-07883
FILM NUMBER: 98767301
BUSINESS ADDRESS:
STREET 1: 12835 ARAPAHOE ROAD
STREET 2: TOWER II, PENTHOUSE
CITY: ENGLEWOOD
STATE: CO
ZIP: 80112
BUSINESS PHONE: 3037901600
MAIL ADDRESS:
STREET 1: 12835 ARAPAHOE ROAD
STREET 2: TOWER II, PENTHOUSE
CITY: ENGLEWOOD
STATE: CO
ZIP: 80112
REGISTRATION NO. 333-14927
REGISTRATION NO. 811-7883
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No.......
Post-Effective Amendment No. 4
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 4
ICON Funds
(Exact Name Of Registrant As Specified In Charter)
12835 East Arapahoe Road Tower II Englewood, Colorado 80112
(Address of Principal Executive Office)
Registrant's Telephone Number, including Area Code: (303) 790-1600
Erik L. Jonson
12835 East Arapahoe Road Tower II Englewood, Colorado 80112
(Name and Address of Agent for Service)
With copy to:
Charles W. Lutter, Jr., Attorney
103 Canyon Oaks, San Antonio, TX 78232-1305
It is proposed that this filing will become effective:
/ / immediately upon filing pursuant to paragraph (b)
/ / on (date) pursuant to paragraph (b)
/ X / 60 days after filing pursuant to paragraph (a)(1)
/ / on (date) pursuant to paragraph (a)(1)
/ / 75 days after filing pursuant to paragraph (a)(2)
/ / on (date) pursuant to paragraph (a)(2) of Rule 485
<PAGE>
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PART A
PROSPECTUS
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ICON FUNDS
PROSPECTUS
November 22, 1999
U.S. Equity Funds International Equity Funds
ICON Basic Materials Fund ICON Asia Region Fund
ICON Capital Goods Fund ICON South Pacific Region Fund
ICON Consumer Cyclicals Fund ICON North Europe Region Fund
ICON Consumer Staples Fund ICON South Europe Region Fund
ICON Energy Fund ICON Western Hemisphere Fund
ICON Financial Services Fund
ICON Healthcare Fund Fixed Income Fund
ICON Leisure Fund ICON Short-Term Fixed Income Fund
ICON Technology Fund
ICON Telecommunication & Utilities Fund
ICON Transportation Fund
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS ANY COMMISSION
DETERMINED WHETHER THIS PROSPECTUS IS ACCURATE OR COMPLETE. IT IS A CRIMINAL
OFFENSE TO STATE OTHERWISE.
TABLE OF CONTENTS
SUMMARY OF PRINCIPAL INVESTMENT OBJECTIVES, STRATEGIES AND RISKS 3
FUND BY FUND SUMMARY-HOW HAVE THE FUNDS PERFORMED 6
ICON Basic Materials Fund 7
ICON Consumer Cyclicals Fund 8
ICON Energy Fund 9
ICON Financial Services Fund 10
ICON Healthcare Fund 11
ICON Leisure Fund 12
ICON Technology Fund 13
ICON Telecommunication & Utilities Fund 14
ICON Transportation Fund 15
ICON Asia Region Fund 16
ICON North Europe Region Fund 17
ICON South Europe Region Fund 18
ICON Short-Term Fixed Income Fund .....................................19
FUND FEES AND EXPENSES PAID BY A SHAREHOLDER...........................20
MORE INFORMATION ABOUT THE FUNDS' INVESTMENT OBJECTIVES,
PRINCIPAL STRATEGIES AND RISKS 22
ADDITIONAL CONSIDERATIONS...... .......................................31
ORGANIZATION AND MANAGEMENT OF THE FUNDS 32
ABOUT YOUR ACCOUNT............................... .................35
USEFUL INFORMATION ABOUT DISTRIBUTIONS AND TAXES ......................36
HOW TO INVEST IN THE FUND .............................................37
HOW TO REDEEM SHARES ..................................................38
HOW TO MAKE EXCHANGES .................................................40
FINANCIAL HIGHLIGHTS 40
ICON Basic Materials Fund 41
ICON Consumer Cyclicals Fund 42
ICON Energy Fund 43
ICON Financial Services Fund 44
ICON Healthcare Fund 45
ICON Leisure Fund 46
ICON Technology Fund 47
ICON Telecommunication & Utilities Fund 48
ICON Transportation Fund 49
ICON Asia Region Fund 50
ICON North Europe Region Fund 51
ICON South Europe Region Fund 52
ICON Short-Term Fixed Income Fund 53
SUMMARY OF PRINCIPAL INVESTMENT OBJECTIVES, STRATEGIES AND RISKS
The ICON Funds consist of seventeen portfolios each of which has its own
investment objectives and policies. The portfolios are designed to serve a
wide range of investor needs. To help you understand the ICON Funds and
decide which fund is appropriate for you, this section reviews the investment
objectives, strategies and risks.
U.S. Equity Funds - Investment Objective, Strategies and Risks
ICON Basic Materials Fund
ICON Capital Goods Fund (not funded as of the date of this document)
ICON Consumer Cyclicals Fund
ICON Consumer Staples Fund (not funded as of the date of this document)
ICON Energy Fund
ICON Financial Services Fund
ICON Healthcare Fund
ICON Leisure Fund
ICON Technology Fund
ICON Telecommunication & Utilities Fund
ICON Transportation Fund
The investment objective of each U.S. Equity Fund is to provide long-term
growth through investing primarily in the common stock of U.S. issuers.
The strategy focuses on industry rotation within the sector, using a value
approach, generally with a minimum of 2-3 industries for diversification. A
basket of stocks is selected to achieve industry exposure. The portfolio
manager attempts to produce above average returns.
Please keep in mind that no Fund can guarantee that it will meet its
objective and that, as with any investment, you can lose money by investing
in the Fund. As with all equity funds, the share price can fall because of
weakness in the market as a whole, weakness in a particular industry, or
weakness in specific holdings. The Funds' investments in value stocks carry
the risks that the market will not recognize a stock's intrinsic value for a
long time, or that a stock believed to be undervalued may actually be
appropriately priced. We believe the three main risks of invesgement risk
and non- diversification risk.
* Market Risk: The risk that the market value of a security may move up or
down, sometimes rapidly and unpredictably. These fluctuations may cause a
security to be worth less than it was worth at an earlier time. Market risk
may affect a single issuer, industry, sector of the economy or the market as
a whole.
* Management Risk: The risk that a strategy used by a Fund's management may
fail to produce the intended result.
* Non-Diversification Risk: The U.S. Equity Funds are non-diversified, and
each may invest up to 25% of its total assets in the securities of one
issuer at the time of purchase. The Fund's net asset value may be more
volatile than that of a more-widely diversified fund because the Fund may
invest more of its assets in a smaller number of issuers. Consequently,
the Fund may be more vulnerable to any single economic, political or
regulatory occurrence, and the gains or losses on a single stock may have
a greater impact on the Fund's net asset value.
* International Equity Funds - Investment Objective, Strategies and Risks
ICON Asia Region Fund
ICON South Pacific Region Fund (not funded as of the date of this document)
ICON North Europe Region Fund
ICON South Europe Region Fund
ICON Western Hemisphere Fund (not funded as of the date of this document)
The International Equity Funds seek to provide long-term capital
appreciation. Each Fund seeks to achieve its objective by investing primarily
in common stocks of foreign issuers.
The investment strategy focuses on country rotation within the region using a
value approach. A basket of stocks is selected for each country within the
region to achieve broad exposure across industries. The portfolio manager
attempts to produce above average returns.
Please keep in mind that no Fund can guarantee that it will meet its
objective and that, as with any investment, you can lose money by investing in
the Fund. As with all equity funds, the share price can fall because of
weakness in the market as a whole, weakness in a particular industry, or
weakness in specific holdings. The Funds' investments in value stocks carry
the risks that the market will not recognize a stock's intrinsic value for a
long time, or that a stock believed to be undervalued may actually be
appropriately priced. We believe the four main risks of invest
e market risk, management risk, non-diversification risk and international
investing risks.
* Market Risk: The risk that the market value of a security may move up or
down, sometimes rapidly and unpredictably. These fluctuations may cause a
security to be worth less than it was worth at an earlier time. Market risk
may affect a single issuer, industry, sector of the economy or the market as
a whole.
* Management Risk: The risk that a strategy used by a Fund's management
may fail to produce the intended result.
* Non-Diversification Risk: The International Equity Funds are non-
diversified, and each may invest up to 25% of its total assets in the
securities of one issuer at the time of purchase. The Fund's net asset value
may be more volatile than that of a more-widely diversified fund because the
Fund may invest more of its assets in a smaller number of issuers.
Consequently, the Fund may be more vulnerable to any single economic,
political or regulatory occurrence, and the gains or losses on a single stock
may have a greater impact on the Fund's net asset value.
* International Investing Risks: There are additional risks with investing
in foreign countries, especially in developing countries -- specifically,
economic, currency, information, political and transaction risks. As a
result of these additional risks, the Fund may be more volatile than a
domestic equity fund. In addition, foreign stocks may not move in concert
with the U.S. markets.
Fixed Income Fund - Investment Objective, and Strategies and Risks
ICON Short-Term Fixed Income Fund
The ICON Short-Term Fixed Income Fund seeks to provide high current income
consistent with the preservation of capital. Under normal market
conditions, the Fund invests exclusively in (i) U.S. Treasury obligations; (ii)
obligations issued or guaranteed by the agencies and instruments of the U.S.
Government; and (iii) repurchase agreements involving those obligations.
The ICON Short-Term Fixed Income Fund seeks to provide higher current income
than that typically offered by a money market fund. The Fund also seeks to
maintain a high degree of liquidity.
Please keep in mind that no Fund can guarantee that it will meet its
objective and that, as with any investment, you can lose money by investing
in the Fund. An investment in these Funds is not a bank deposit and is not
insured or guaranteed by the Federal Deposit Insurance Corporation or any
other government agency. We believe the two main risks of investing in the
ICON Short-Term Fixed Income Fund are interest rate risk and credit risk.
* Interest Rate Risk: The risk that changes in interest rates will
adversely affect the value of a security. When interest rates rise, the
value of fixed-income securities will generally fall. Conversely, a drop in
interest rates will generally cause an increase in the value of fixed-income
securities. Longer-term securities are subject to greater interest rate risk.
Principal Investment Strategies
The ICON Funds are managed using a value-based industry/country rotation
approach. The ICON Funds' portfolio manager for the U.S. Equity Funds
strives to add value by under-weighting and over-weighting industries within
each portfolio's sector. The ICON Funds' portfolio manager for the
International Equity Funds strives to add value by under-weighting or over-
weighting countries within each portfolio's sector.
A sector fund is a targeted mutual fund. An example of a sector would be
Technology which is made up of fourteen industries. Computer cannot invest
directly in the indexes.
ICON Basic Materials Fund
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The following information provides some indication of the risks of investing in
the Fund by showing how much returns can differ from one year to the next and
by showing how the Fund's average annual returns compare with the returns of a
broad measure of market performance. Past performance is no guarantee of
future returns.
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Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
- ------ ------
- -10.59% (To be added)
Year-to-Date Return through 6-30-99: 18.53%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 3-31-98 Total Return for that Quarter: 13.49%
Worst Quarter: Quarter Ended 12-31-97 Total Return for that Quarter: -30.22%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 5-5-1997
ICON Basic Materials Fund -10.59% -20.75%
S&P Basic Materials Index* -6.40% -1.24%
* The S&P Basic Materials Index is a capitalization-weighted index that
measures the performance of the basic materials sector of the S&P
SuperComposite Index. It is comprised of 125 stocks.
ICON Consumer Cyclicals Fund
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The following information provides some indication of the risks of investing in
the Fund by showing how much returns can differ from one year to the next and
by showing how the Fund's average annual returns compare with the returns of
a broad measure of market performance. Past performance is no guarantee of
future returns.
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Bar Chart: Year-by-Year Total Return -Calendar Year
1998 1999
- ------ ------
5.60% (To be added)
Year-to-Date Return through 6-30-99: 6.82%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 12-31-98 Total Return for that Quarter: 31.64%
Worst Quarter: Quarter Ended 9-30-98 Total Return for that Quarter: -27.47%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 7-9-1997
ICON Consumer Cyclicals Fund 5.60% 2.42%
S&P SuperComposite 1500 Index* 26.32% 23.77%
* Since Standard & Poor's and Lipper do not have a comparable industry
benchmark, the Fund is providing the S&P SuperComposite 1500 Index for
comparison. The S&P SuperComposite 1500 Index is a broad-based
capitalization-weighted index of 1500 U.S. companies and is comprised of the
S&P MidCap 400, S&P 500 and the S&P SmallCap 600 indices.
ICON Energy Fund
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The following information provides some indication of the risks of investing in
the Fund by showing how much returns can differ from one year to the next and
by showing how the Fund's average annual returns compare with the returns of
a broad measure of market performance. Past performance is no guarantee of
future returns.
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Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
- ------ ------
- -37.12% (To be added)
Year-to-Date Return through 6-30-99: 42.65%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 3-31-98 Total Return for that Quarter: 2.53%
Worst Quarter: Quarter Ended 9-30-98 Total Return for that Quarter: -26.42%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 11-5-1997
ICON Energy Fun -37.12% -38.37%
S&P Energy Index* 0.42% -3.29%
* The S&P Energy Index is a capitalization-weighted index of all stocks
designed to measure the performance of the energy sector of the S&P 500
Index. It is comprised of 23 stocks.
ICON Financial Services Fund
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The following information provides some indication of the risks of investing in
the Fund by showing how much returns can differ from one year to the next and
by showing how the Fund's average annual returns compare with the returns of
a broad measure of market performance. Past performance is no guarantee of
future returns.
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Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
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7.04% (To be added)
Year-to-Date Return through 6-30-99: 10.43%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 12-31-98 Total Return for that Quarter: 19.72%
Worst Quarter: Quarter Ended 9-30-98 Total Return for that Quarter: -23.45%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 7-1-1997
ICON Financial Services Fund 7.04% 8.27%
Lipper Financial Services Funds Index* 5.91% 17.99%
* The Lipper Financial Services Funds Index is a total return performance
index consisting of the largest mutual funds within its respective investment
objective category. It is comprised of 10 funds.
ICON Healthcare Fund
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The following information provides some indication of the risks of investing in
the Fund by showing how much returns can differ from one year to the next and
by showing how the Fund's average annual returns compare with the returns of
a broad measure of market performance. Past performance is no guarantee of
future returns.
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Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
- ------ ------
15.31% (To be added)
Year-to-Date Return through 6-30-99: 3.24%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 6-30-97 Total Return for that Quarter: 17.12 %
Worst Quarter: Quarter Ended 9-30-98 Total Return for that Quarter: -11.50%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 2-24-1997
ICON Healthcare Fund 15.31% 17.28%
Health/Biotechnology Funds Index* 26.00% 20.65%
* The Lipper Health/Biotechnology Funds Index is a total return performance
index consisting of the largest mutual funds within its respective investment
objective category. It is comprised of 10 funds.
ICON Leisure Fund
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The following information provides some indication of the risks of investing in
the Fund by showing how much returns can differ from one year to the next and
by showing how the Fund's average annual returns compare with the returns of
a broad measure of market performance. Past performance is no guarantee of
future returns.
- ----------------------------------------------------------------------------
Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
- ------ ------
17.84% (To be added)
Year-to-Date Return through 6-30-99: 13.40%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 12-31-98 Total Return for that Quarter: 15.14%
Worst Quarter: Quarter Ended 9-30-98 Total Return for that Quarter: -4.22%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 5-9-1997
ICON Leisure Fund 17.84% 20.61%
S&P Entertainment/Leisure Composite Index* 33.17% 30.97%
* The S&P Entertainment/Leisure Composite Index is a capitalization-weighted
index of all the stocks in the Standard & Poor's 500 that are involved in
the business of entertainment and leisure related products and services. It
is comprised of 15 stocks.
ICON Technology Fund
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The following information provides some indication of the risks of investing
in the Fund by showing how much returns can differ from one year to the next
and by showing how the Fund's average annual returns compare with the
returns of a broad measure of market performance. Past performance is no
guarantee of future returns.
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Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
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33.96% (To be added)
Year-to-Date Return through 6-30-99: 42.41%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 12-31-98 Total Return for that Quarter: 46.05%
Worst Quarter: Quarter Ended 12-31-97 Total Return for that Quarter: -19.51%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 2-19-1997
ICON Technology Fund 33.96% 19.68%
Lipper Science & Technology Funds Index* 46.77% 24.71%
* The Lipper Science & Technology Funds Index is a total return performance
index consisting of the largest mutual funds within its respective investment
objective category. It is comprised of 10 funds.
ICON Telecommunication and Utilities Fund
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The following information provides some indication of the risks of investing
in the Fund by showing how much returns can differ from one year to the next
and by showing how the Fund's average annual returns compare with the returns
of a broad measure of market performance. Past performance is no guarantee
of future returns.
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Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
- ------ ------
29.99% (To be added)
Year-to-Date Return through 6-30-99: 6.26%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 12-31-97 Total Return for that Quarter: 15.27%
Worst Quarter: Quarter Ended 6-30-98 Total Return for that Quarter: -1.97%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 7-9-1997
ICON Telecommunication & Utilities Fund 29.99% 36.98%
Lipper Utilities Funds Index* 18.40% 23.18%
* The Lipper Utilities Funds Index is a total return performance index
consisting of the largest mutual funds within its respective investment
objective category. It is comprised of 30 funds.
ICON Transportation Fund
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The following information provides some indication of the risks of investing
in the Fund by showing how much returns can differ from one year to the next
and by showing how the Fund's average annual returns compare with the returns
of a broad measure of market performance. Past performance is no guarantee
of future returns.
- ----------------------------------------------------------------------------
Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
- ------ ------
5.35% (To be added)
Year-to-Date Return through 6-30-99: 6.99%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 12-31-98 Total Return for that Quarter: 26.53%
Worst Quarter: Quarter Ended 9-30-98 Total Return for that Quarter: -18.25%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 5-9-1997
ICON Transportation Fund 5.35% 12.98%
S&P Transportation Index* 0.38% 11.44%
* The S&P Transportation Index is a capitalization-weighted index that
measures the performance of the transportation sector of the S&P
SuperComposite 1500 Index. It is comprised of 39 stocks.
ICON Asia Region Fund
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The following information provides some indication of the risks of investing
in the Fund by showing how much returns can differ from one year to the next
and by showing how the Fund's average annual returns compare with the returns
of a broad measure of market performance. Past performance is no guarantee
of future returns.
- ----------------------------------------------------------------------------
Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
- ------ ------
- -6.17% (To be added)
Year-to-Date Return through 6-30-99: 26.42%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 12-31-98 Total Return for that Quarter: 27.42%
Worst Quarter: Quarter Ended 9-30-98 Total Return for that Quarter: -17.26%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 2-25-1997
ICON Asia Region Fund -6.17% -12.83%
MSCI Pacific Index* 1.43% -12.26%
* The Morgan Stanley Capital International (MSCI) Pacific Index is
comprised of stocks traded in the developed markets of the Pacific Basin
(Australia, Hong Kong, Japan, Malaysia, New Zealand, and Singapore). The
index tries to capture at least 60% of investable capitalization in those
markets subject to constraints governed by industry representation, maximum
liquidity, maximum float, and minimum cross-ownership (companies with
exposure in multiple countries). The index is capitalization weighted.
ICON North Europe Region
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The following information provides some indication of the risks of investing
in the Fund by showing how much returns can differ from one year to the next
and by showing how the Fund's average annual returns compare with the returns
of a broad measure of market performance. Past performance is no guarantee
of future returns.
- ----------------------------------------------------------------------------
Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
- ------ ------
15.25% (To be added)
Year-to-Date Return through 6-30-99: -2.10%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 3-31-98 Total Return for that Quarter: 14.35%
Worst Quarter: Quarter Ended 9-30-98 Total Return for that Quarter: -12.69%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 2-18-1997
ICON North Europe Region Fund 15.25% 15.07%
MSCI Europe 15 Index* 26.53% 25.14%
* The Morgan Stanley Capital International (MSCI) Europe 15 Index is
comprised of stocks traded in the developed markets of Europe. The index tries
to capture at least 60% of investable capitalization in those markets subject
to constraints governed by industry representation, maximum liquidity,
maximum float, and minimum cross-ownership (companies with exposure in
multiple countries). The index is capitalization weighted.
ICON South Europe Region Fund
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The following information provides some indication of the risks of investing
in the Fund by showing how much returns can differ from one year to the next
and by showing how the Fund's average annual returns compare with the returns
of a broad measure of market performance. Past performance is no guarantee
of future returns.
- ----------------------------------------------------------------------------
Bar Chart: Year-by-Year Total Return - Calendar Year
1998 1999
- ------ ------
21.71% (To be added)
Year-to-Date Return through 6-30-99: -12.42%
Year-to-Date Return through 9-30-99: (To be added)
For Periods Ended 12-31-98:
Best Quarter: Quarter Ended 3-31-98 Total Return for that Quarter: 21.99%
Worst Quarter: Quarter Ended 9-30-98 Total Return for that Quarter: -19.09%
AVERAGE ANNUAL TOTAL RETURN
Periods Ended 12-31-98
1 Year Since Inception Date 2-20-1997
ICON South Europe Region Fund 21.71% 24.67%
MSCI Europe 15 Index* 26.53% 25.21%
* The Morgan Stanley Capital International (MSCI) Europe 15 Index is
comprised of stocks traded in the developed markets of Europe. The index
tries to capture at least 60% of investable capitalization in those markets
subject to constraints governed by industry d and other expenses incurred by
the shareholder.
Shareholder Transaction Expenses
Shareholder Transaction Expenses
ICON U.S. Equity Funds
ICON International Equity Funds
ICON Short-Term Fixed Income Fund
Sales Load Imposed on Purchases None None None
Deferred Sales Load None None None
Redemption Fees None None None
Exchange Fees None None None
ANNUAL FUND OPERATING EXPENSES
Management Fees Other Expenses Total Fund Operating Expenses
U.S. Equity Funds
ICON Basic Materials Fund 1.00% 0.33% 1.33%
ICON Capital Goods Fund* 1.00% 0.45% 1.45%
ICON Consumer Cyclicals Fund 1.00% 0.37% 1.37%
ICON Consumer Staples Fund* 1.00% 0.45% 1.45%
ICON Energy Fund (annualized) 1.00% 0.20% 1.20%
ICON Financial Services Fund 1.00% 0.33% 1.33%
ICON Healthcare Fund 1.00% 0.24% 1.24%
ICON Leisure Fund 1.00% 0.30% 1.30%
ICON Technology Fund 1.00% 0.31% 1.31%
ICON Telecommunication &
Utilities Fund 1.00% 0.34% 1.34%
ICON Transportation Fund 1.00% 0.41% 1.41%
International Equity Funds
ICON Asia Region Fund 1.00% 0.65% 1.65%
ICON South Pacific Region Fund*1.00% 0.65% 1.65%
ICON North Europe Region Fund 1.00% 0.54% 1.54%
ICON South Europe Region Fund** 1.00% 1.10% 2.10%
ICON Western Hemisphere Fund* 1.00% 0.65% 1.65%
Fixed Income Fund
ICON Short-Term Fixed
Income Fund*** 0.65% 0.19% 0.84%
* Fund has not commenced operations. Estimated amounts expected for the
first fiscal year
** Does not reflect reimbursement from co-administrator for fees and
expenses.
This reimbursement reduced the ratio of expenses to average net assets to
1.56%
*** Does not include change in accounting estimate for over accrual of
expenses of $127,000. This change made the ratio of expenses to average net
assets .11%.
Hypothetical Example of Effect of Fund Expenses
The following table gives you an idea of what you would pay in expenses on a
$10,000 investment, assuming 5% annual return and redemption at the end of each
time period:
FUND 1YEAR 3YEARS 5YEARS 10YEARS
U.S. EQUITY FUNDS
ICON Basic Materials Fund $135 $421 $729 $1,601
ICON Consumer Cyclicals Fund $139 $434 $750 $1,646
ICON Energy Fund $122 $381 $660 $1,455
ICON Financial Services Fund $135 $421 $729 $1,601
ICON Healthcare Fund $126 $393 $681 $1,500
ICON Leisure Fund $132 $412 $713 $1,568
ICON Technology Fund $133 $415 $718 $1,579
ICON Telecommunications &
Utilities Fund $136 $425 $734 $1,613
ICON Transportation Fund $144 $446 $771 $1,691
INTERNATIONAL EQUITY FUND
ICON Asia Region Fund $168 $520 $897 $1,955
ICON North Europe Region Fund $157 $486 $839 $1,834
ICON South Europe Region Fund $213 $658 $1,129 $2,431
FIXED INCOME FUND
ICON Short-Term Fixed
Income Fund $86 $268 $466 $1,037
Each U.S. Equity Fund is comprised of industry-specific "baskets" of
securities which are subsets of the sector, examples of which are provided
below under each Fund's description. Each industry basket will encompass a
passive sample of stocks from the portfolio manager's approved list for the
industry.
Investment selection and weighting of baskets within each Fund are based on
the attractiveness of an industry. The portfolio manager uses its
proprietary valuation model to analyze its universe of stocks based on the
following factors: historical and estimated future earnings; long-term
earnings growth projections; risk; current and future interest rate
conditions; and current price. The portfolio manager then groups stocks into
their representative industry classifications to determine those industries
it deems to be attractive relative to other industries.
ICON Basic Materials Fund - Industry baskets include, but are not limited
to: Construction; Containers; Gold Mining; Chemicals; Metals Mining;
Aluminum; Paper & Forest Products; Metal Fabricators; and Steel.
Many companies in the basic materials sector are significantly affected by
the level and volatility of commodity prices, the exchange value of the
dollar, import controls, and worldwide competition. At times, worldwide
production of these materials has exceeded demand as a result of over-
building or economic downturns, leading to poor investment returns or losses.
Other risks may include liability for environmental damage, depletion of
resources, and mandated expenditures for safety and pollution control. In
addition, the environment services industry can be impacted by legisla
, and enforcement policies. As regulations are developed and enforced,
companies may be required to alter or cease production of a product or service.
The price of precious metals is affected by broad economic and political
conditions. For example, the price of gold and other precious metal mining
securities can face substantial short-term volatility caused by international
monetary and political developments such as currency devaluations or
revaluations, economic and social conditions within a country, or trade
restrictions between countries. Since much of the world's gold reserves are
located in South Africa, the social and economic conditions there can affect
gold and gold-related companies located elsewhere. The price of precious
metals is closely tied to broad economic and political conditions.
ICON Capital Goods Fund (not funded as of the date of this prospectus) -
Industry baskets include, but are not limited to: Chemicals; Building
Materials; Conglomerates; Electrical Equipment; Machine Tools; Machinery
(Diversified); Manufacturing; and Pollution Control/Environment.
Companies in the chemical processing field are subject to intense
competition, product obsolescence, and significant government regulation.
As regulations are developed and enforced, those companies may be required
to alter or cease production of a product, to pay fines, or to pay for
cleaning up a disposal site. In addition, chemical companies face unique
risks associated with handling hazardous products.
The success of equipment manufacturing and distribution companies is closely
tied to overall capital spending levels, which is influenced by an
individual company's profitability, and broader issues such as interest
rates and foreign competition. The industry may also be affected by
economic cycles, technical progress, labor relations, and government
regulations.
ICON Consumer Cyclicals Fund - Industry baskets include, but are not limited
to: Hardware & Tools; Engineering & Construction; Homebuilding/Manufactured
Housing; Household Furnishings & Appliances; Housewares;
Retail-General/Department Stores; Retail-Specialty; Retail-Specialty
Apparel; Shoes; Textile-Apparel Manufacturers; and Toys.
The success of consumer product manufacturers and retailers is closely tied
to the performance of the overall economy, interest rates, competition, and
consumer confidence. Success depends heavily on disposable household income
and consumer spending. Changes in demographics and consumer tastes can
affect the demand for, and success of, consumer products in the marketplace.
ICON Consumer Staples Fund (not funded as of the date of this prospectus) -
Industry baskets include, but are not limited to: Beverages; Cosmetics;
Distributors-Consumer Products; Foods; Household Products; Retail-Drug;
Retail-Food Chains; and Tobacco.
The success of retailing companies is closely tied to consumer spending.
Spending is affected by general economic conditions and consumer confidence
levels. The retailing industry is highly competitive, and a company's
success is often tied to its ability to anticipate changing consumer tastes.
In addition, the agriculture/food industry is impacted by supply and demand,
which may be affected by demographic and product trends, and by food fads,
marketing campaigns, and environmental factors. In the U.S., the
agricultural products industry is subject to regulation by numerous
government agencies.
ICON Energy Fund - Industry baskets include, but are not limited to: Oil-
Domestic and International Integrated; Oil and Gas-Equipment & Drilling; Oil
and Gas-Exploration & Production; Oil and Gas-Refining and Marketing; and
Natural Gas. Securities of companies in the energy field are subject to
changes in value and dividend yield. These changes depend largely on the
price and supply of both conventional and alternative energy sources. Swift
price and supply fluctuations may be caused by events relating to
international politics, energy conservation, the success of energy source
exploration projects, and tax and other regulatory policies of domestic and
foreign governments.
ICON Financial Services Fund - Industry baskets include, but are not limited
to: Banks; Financial Services; Insurance Property Casualty; Insurance-
Life/Multi-line; Investment Banks/Brokerage Firms; Personal Loans; Real
Estate Investment Trusts; and Savings & Loan Companies.
Financial services companies are subject to extensive governmental
regulation. This may limit both the amounts and types of services offered,
loans and other financial commitments permitted, and the interest rates and
fees they can charge. Profitability is largely dependent on the availability
and cost of capital funds, and can fluctuate significantly when interest
rates change. Credit losses resulting from financial difficulties of
borrowers can negatively impact the industry. Company profits are affected
by interest rate levels, general economic conditions, and price
According to SEC regulations, the Fund may not invest more than 5% of its
total assets in the equity securities of any company that derives more than
15% of its revenues from brokerage or investment management activities at
the time of purchase.
Companies in the real estate industry are subject to changes in interest
rates, consumer confidence and spending, taxation, demographic patterns, the
level of new and existing home sales, and other economic activity. They are
also affected by what the government spends on housing subsidies, public
works and transportation.
ICON Healthcare Fund - Industry baskets include, but are not limited to:
Biotechnology; Hospital Management; Long-Term Care; Special Services;
Managed Care; Healthcare Drugs/ Pharmaceuticals; and Medical Equipment &
Devices. The health care industry is subject to government regulation and
approval of products and services. This could have a significant effect on
price and availability. Moreover, federal and state governments provide a
substantial percentage of revenues to health care service providers. The
types of products or services produced or provided by a particular company
may quickly become obsolete. Similarly, biotechnology companies
obsolescence, and regulatory requirements. In addition, many of these
companies may not offer products yet and may have persistent losses or
erratic review patterns.
ICON Leisure Fund - Industry baskets include, but are not limited to:
Broadcasting/Cable; Entertainment; Gaming; Leisure Time Products; Lodging-
Hotels; Publishing; Publishing-Newspapers; Tobacco; and Restaurants.
Securities of the companies in the leisure industry may be considered
speculative. These securities generally exhibit greater volatility than the
overall market. Many companies have unpredictable earnings due, in part, to
changing consumer tastes and intense competition. The industry has reacted
strongly to technological developments and to the threat of government
regulations. Federal deregulation of cable and broadcasting has affected
many companies in these industries. As a result, competitive pressures are
intense and the stocks are subject to increased price volatility.
ICON Technology Fund - Industry baskets include, but are not limited to:
Communication Equipment; Computers, Hardware, Software Networking,
Peripherals and Servicing; Data Processing; Electronics, Defense, Components,
Distributors, and Instruments; Semiconductors, Equipment and Electronics;
Office Equipment & Supplies; and Photography/Imaging.
Competitive pressures and changing domestic and international demand may
significantly effect the financial condition of companies in the computer
industry. For example, if technology continues to advance at an accelerated
rate, and the number of companies and product offerings continues to expand,
these companies could become increasingly sensitive to short product cycles
and aggressive pricing. Further, research and development are large costs to
these companies, and they are also sensitive to the risk of product
obsolescence. Products or services provided by these industries may be in
the development stage and can face risks such as failure to obtain financing
or regulatory approval, intense competition, product incompatibility,
consumer preference, and rapid obsolescence.
ICON Telecommunication & Utilities Fund - Industry baskets include, but are
not limited to: Cellular; Electric, Gas and Water Utilities; and
Telecommunications. Companies in the telecommunications field may range from
traditional local and long-distance telephone service or equipment providers,
to companies involved in new technologies such as cellular telephone or
paging services.
Telephone operating companies are subject to both federal and state
regulations governing rates of return and services that may be offered.
Many companies in the industry fiercely compete for market share. Although
telephone companies usually pay an above average dividend, the Fund's
investment decisions are primarily based on growth potential and not on income.
Energy service firms are affected by supply and demand both for their
specific product or service, and for energy products in general. The price
of oil and gas, exploration and production spending, governmental regulation,
world events and economic conditions will also affect the performance of
these companies.
Public utility stocks have traditionally produced above-average dividend
income, but the Fund's investments are based on growth potential. The gas
and electric public utilities industries may be subject to broad risks
resulting from governmental regulation, financing difficulties, supply and
demand of services or fuel, and special risks associated with energy and
atmosphere conservation. Under SEC laws, the Fund may not own more than 5%
of the outstanding voting securities of more than one public utility company.
ICON Transportation Fund - Industry baskets include, but are not limited to:
Aerospace/Defense; Automobiles; Airlines; Railroads; Heavy Duty Truck &
Parts; and Truckers.
Profitability in these industries is influenced by the price of fuel,
competition, and domestic and foreign economies and government regulation.
The airline industry is still feeling the effects of deregulation. In
addition, the automotive industry is highly cyclical and companies may
suffer periodic operating losses. While most of the major participants in the
transportation sector are large, financially strong companies, some are
smaller with a non-diversified product line or customer base.
International Equity Funds
Each Fund seeks to achieve long-term capital appreciation by investing
primarily in equity securities. These securities include common stocks and
securities convertible into common stocks of foreign issuers.
Each International Equity Fund focuses on a particular geographic region of
the world. Under normal circumstances, at least 65% of the total assets of
each Fund is invested in securities of companies principally engaged in the
business activities in its particular named geographic region. A company is
considered to be "principally engaged" in business activities in a specific
region if it has one or more of the following characteristics: (i) its
principal securities trading market is in that region; (ii) the company
derives at least 50% of its annual revenue from either goods produced, sales
made, or services performed in that region; or (iii) the company is
operating in and is organized under the laws of, or has its principal
offices in, a country in that region. The remainder of the Fund's assets ma
Each International Equity Fund is comprised of country-specific "baskets" of
securities which are subsets of the region, examples of which are provided
in each Fund's description. Each of these country baskets will encompass a
sample of stocks from the portfolio manager's approved list for the country.
Investment selection and weighting of baskets within each Fund are based on
country attractiveness. The portfolio manager uses its proprietary
valuation model to analyze its universe of stocks based on the following
factors: historical and estimated future earnings; long-term earnings growth
projections; risk; current and future interest rate conditions; and current
price. The portfolio manager then groups stocks into their country
classifications to determine those countries it deems to be attractive
relative to other countries.
ICON Asia Region Fund - May include, but is not limited to, baskets of
securities from the following countries: Japan; Korea; China (plus Hong
Kong); and Taiwan.
ICON South Pacific Region Fund (not funded as of the date of this
prospectus) - May include, but is not limited to, baskets of securities from
the following countries: Australia; Indonesia; Malaysia; New Zealand; and
Singapore.
ICON North Europe Region Fund - May include, but is not limited to, baskets
of securities from the following countries: Belgium; Denmark; Finland;
Germany; Ireland; Netherlands; Norway; Sweden; and United Kingdom.
ICON South Europe Region Fund - May include, but is not limited to, baskets
of securities from the following countries: Austria; France; Greece;
Italy; Portugal; Spain; and Switzerland.
ICON Western Hemisphere Fund (not funded as of the date of this prospectus)
- - May include, but is not limited to, baskets of securities from the
following countries: Argentina; Brazil; Canada; Chile; and Mexico
Fixed Income Fund
ICON Short-Term Fixed Income Fund - The objective of the Short-Term Fixed
Income Fund is to attain high current income consistent with preservation of
capital. The Fund seeks to provide higher current income than that typically
offered by a money market fund while maintaining a high degree of liquidity.
Therefore, there is a higher risk of principal volatility. Under normal
market conditions, the Fund invests exclusively in (i) U.S. Treasury
obligations; (ii) obligations issued or guaranteed as to principal and
interest by agencies and instruments of the U.S. Government; and (iii)
repurchase agreements involving those obligations. Under normal condit
measure of the Fund's sensitivity to changes in interest rates) will range
from half a year to one and a half years. Maximum remaining maturity of any
single issue will be two years, with the exception of floating rate
securities that reset at least annually.
Risks of International Investing
Investing in securities of foreign companies generally involves greater
risks than investing in securities of domestic companies. Investors should
consider carefully the following special factors before investing in a Fund.
Currency Risk: The value of a Fund's foreign investments may be affected by
changes in currency exchange rates. The U.S. dollar value of a foreign
security generally decreases when the value of the U.S. dollar rises against
the foreign currency in which the security is denominated, and tends to
increase when the value of the U.S. dollar falls against the currency.
Political and Economic Risk: The economies of many of the countries in
which a Fund may invest are not as developed as the U.S. economy and may be
subject to significantly different forces. Political or social instability,
limitations on the removal of funds, and taxation could also adversely affect
the value of a Fund's investments.
Market Risk: The securities markets in many of the countries in which a
Fund invests will have substantially less trading volume than the major U.S.
markets. As a result, the securities of some foreign companies may be less
liquid and experience more price volatility than comparable domestic
securities. There is generally less government regulation and supervision of
foreign stock exchanges, brokers and issuers which may make it difficult to
enforce contractual obligations. Transaction costs, such as brokerage
commissions, in foreign securities markets are likely to be higher. Further,
the settlement period of securities transactions in foreign markets may be
longer than in domestic markets. These considerations generally are more of
a concern in developing countries. For example, the possibility of
revolution and the dependence on foreign economic assistance may be greater
in these countries than in developed countries. The management of the Funds
seeks to mitigate the risks associated with these considerations through
diversification and active professional management.
Regulatory Risk: Foreign companies are generally not subject to the
regulatory controls imposed on U.S. issuers. As a consequence, there is
generally less public information available about foreign securities than is
available about domestic securities. Foreign companies are not subject to
accounting, auditing and financial reporting standards, practices and
requirements comparable to those applicable to domestic companies. Income
from foreign securities owned by a Fund may be reduced by withholding taxes
which would reduce dividend income payable to the Fund's shareholders.
Emerging Markets and Developing Countries: Investments in emerging markets
or developing countries involve exposure to economic structures that are
generally less diverse and mature and to political systems es in the value of a
hedging instrument will not match those of the asset being hedged (hedging
is the use of one investment to offset the effects of another investment).
Credit Risk: The risk that the issuer of a security, or the counter-party
to a contract, will default or otherwise become unable to honor a financial
obligation.
Currency Risk: The risk that fluctuations in the exchange rates between the
U.S. dollar and foreign currencies may negatively affect an investment.
Information Risk: The risk that key information about a security or market
is inaccurate or unavailable.
Interest Rate Risk: The risk of market losses attributable to changes in
interest rates. With fixed-rate securities, a rise in interest rates
typically causes a fall in values, while a fall in rates typically causes a
rise in values.
Leverage Risk: Associated with securities or practices (such as borrowing)
that multiply small index or market movements into large changes in value.
-- Hedged: When a derivative (a security whose value is based on another
security or index) is used as a hedge against an opposite position which the
Fund also holds, any loss generated by the derivative should be substantially
offset by gains on the hedged investment, and vice versa. While hedging can
reduce or eliminate losses, it can also reduce or eliminate gains.
- -- Speculative: To the extent that a derivative is not used as a hedge, the
fund is directly exposed to the risks of that derivative. Gains or losses
from speculative positions in a derivative may be substantially greater than
the derivative's original cost.
Liquidity Risk: The risk that certain securities may be difficult or
impossible to sell at the time and the price that the seller would like.
Management Risk: The risk that a strategy used by a Fund's management may
fail to produce the intended result. This risk is common to all mutual funds.
Market Risk: The risk that the market value of a security may move up and
down, sometimes rapidly and unpredictably. These fluctuations may cause a
security to be worth less than it was worth at an earlier time. Market risk
may affect a single issuer, industry, sector of the economy or the market as
a whole. This risk is common to all stocks and bonds and the mutual funds
that invest in them.
Natural Event Risk: The risk of losses attributable to natural disasters,
crop failures and similar events.
Non-Diversification Risk: The risk that there may be a limited number of
companies in a portfolio, each representing a larger percentage of the
portfolio and, if adversely effected by some event, each would have a greater
adverse effect on the portfolio than on a portfolio where assets are
diversified among a larger number of companies.
Opportunity Risk: The risk of missing out on an investment opportunity
because the assets necessary to take advantage of it are tied up in other
investments.
Political Risk: The risk of losses directly attributable to government or
political actions of any sort. These actions may range from changes in tax
or trade statutes to expropriation, governmental collapse and war.
Valuation Risk: The risk that a Fund has valued certain of its securities
at a higher price than it can sell them.
ADDITIONAL CONSIDERATIONS
Non-Diversified Portfolio: The Funds are non-diversified portfolios, which
means that, with respect to 50% of its total assets, each Fund may invest
more than 5% of its assets in obligations of one issuer. (A diversified
portfolio may not invest more than 5% of its assets in obligations of one
issuer, with respect to 75% of its total assets.) Since the Funds may invest
a greater percentage of their assets in securities of fewer issuers than a
diversified portfolio, they may be subject to greater investment and credit
risks than a diversified portfolio.
Fundamental Policies: The investment objectives of the Funds, including
concentration percentages, and certain of the limitations set forth in the
Statement of Additional Information ("SAI") as fundamental policies may not
be changed without the affirmative vote of the majority of the outstanding
shares of the Fund. Fundamental limitations set forth in the SAI include,
among other things, limiting borrowing to 33 1/3% for temporary,
extraordinary purposes; restricting short sales to situations where the
security is owned by the Fund; restricting the acquisition of more than 10%
of the voting securities of any one issuer; and limiting lending of Fund assets.
Temporary Defensive Position: In seeking its primary investment objective
of capital appreciation, a Fund may expect that it generally will hold
investments for at least six months. However, if the Advisor concludes that
economic, market, or industry conditions warrant major adjustments in any
Fund's investment positions, or if unusual market conditions or developments
dictate the taking of a temporary defensive position in short-term money market
instruments, changes may be made without regard to the length of time an
investment has been held, or whether a sale results in profit or loss, or a
purchase results in the reacquisition of an investment which may have only
recently been sold by the Fund.
Portfolio Turnover and Fund Assets: Each Fund does not intend to purchase
or sell securities for short-term trading purposes. A Fund will, however, sell
any portfolio security (without regard to the length of time it has been held)
when the Advisor believes that market conditions, creditworthiness factors or
general economic conditions warrant the action. The portfolio turnover rate
of each Fund will generally not exceed 100%. However, investment advisers
will be using the various funds to accommodate their clients' needs. If the
asset allocation or timing models dictate, they may move significant funds in
or out of a particular fund, increasing the portfolio turnover rate. In this
regard investors should be aware that a Fund may not have significant assets
at a time when money managers place their client funds in other sectors which
may expose remaining shareholders to higher expense ratios.
Shareholder Rights: The Trust does not hold an annual meeting of
shareholders. When matters are submitted to shareholders for a vote, each
shareholder is entitled to one vote for each whole share he owns and
fractional votes for fractional shares he owns. All shares of the Fund have
equal voting rights and liquidation rights.
Year 2000 Computer Issue: Many computer systems in use today cannot properly
process date-related information from and after January 1, 2000. Failure of
any computer system employed by the Funds or the Funds' major service providers
could have a negative impact on fund operations and shareholder services. The
Year 2000 problem also presents some uncertainties and possible risks
(particularly in foreign markets) as to whether payment and operational
systems of banks, brokers and other financial institutions will be affected.
As major service providers, the Funds' advisor, custodian, transfer agent and
fund accounting service have taken inventory of all hardware, software,
networks and processing platforms, and customer and vendor interdependencies.
The Advisor has requested that significant vendors assess and advise with
respect to Year 2000 issues in order to determine the extent to which fund
operations would be vulnerable to third party failure to remedy their own
Year 2000 issues. As a result of these actions, the Funds and the Funds'
adviser have no reason to believe that there will be a negative impact on
fund operations as a result of the Year 2000 problem.
ORGANIZATION AND MANAGEMENT OF THE FUNDS
How are the ICON Funds organized?
The ICON Funds is a non-diversified "open-end management investment company"
or mutual fund. Mutual funds pool money from shareholders and invest it to try
to achieve specified objectives.
The ICON Funds was formed on September 19, 1996, as a "business trust" under
the laws of the Commonwealth of Massachusetts. It is a "series" company which
is authorized to issue shares without par value in separate series of the same
class. Shares of numerous series have been authorized. The Board of
Trustees has the power to create additional portfolios at any time without a
vote of shareholders. No annual or regular meeting of shareholders is
required, although the Trustees may authorize special meetings from time to
time. On any matter submitted to shareholders, shares of each portfolio
entitle their holder to one vote per share.
Who runs the Funds?
Trustees
The business affairs of each Fund are governed by the Funds' Board of
Trustees. The Trustees meet regularly to establish and review policies,
review the Funds' investments, performance, expenses, contracts, and other
business affairs. The Trustees also elect the officers and select the
Trustees to serve as executive and audit committee members.
Portfolio Management -The Investment Advisor
Meridian Investment Management Corporation, of Englewood, Colorado,
furnishes investment advice to the Funds and manages each Fund's investments.
Meridian is owned by Dr. Craig T. Callahan. Meridian's sole business is the
management and service of growth-oriented portfolios to meet the investment
needs of its clients. Meridian's clients include individuals, pension and
profit sharing plans, foundations, endowments, and public retirement systems.
Meridian's value-based investment style utilizes fundamental procedures and
quantitative tools developed internally.
The investment decisions for each Fund are made by the Advisor's Investment
Committee. The Investment Committee is primarily responsible for the day-
to-day management of each Fund's portfolio. The Committee meets regularly as
well as when circumstances dictate. Quantitative data and investment
recommendations are presented by members of the research team and are
discussed by the Committee. Decisions concerning industries and countries for
the Funds are agreed upon by the Committee. The portfolio managers are
responsible for selecting the baskets of securities in each industry and
country to capture "industry-like" and "country-like" performance. The
analysts provide all of the data necessary to make decisions at the portfolio
manager and investment committee level. Once an investment decision has been
reached, trading instructions are executed by the trading department.
Dr. Craig T. Callahan is Chairman of the Investment Committee. He directs
Meridian's investment research and analysis. Dr. Callahan has been Chief
Investment Officer for the Advisor and its predecessor since 1986. The
Advisor and Dr. Callahan, without admitting or denying any wrongdoing,
consented to the entry of a SEC order finding that some of the Advisor's
advertising and related recordkeeping during periods prior to the creation of
the ICON Funds violated provisions of the Investment Advisers Act of 1940.
In the Matter of Meridian Investment Management Corporation, et al.,
Investment Advisers Act Release No.1779, December 28, 1998.
Patrick S. Boyle is also a portfolio manager for the Advisor, and a member
of its Investment Committee. He began his investment career and joined the
Fund's Advisor in 1993.
The Management Fee
For the services provided to ICON Funds, Meridian receives a monthly fee
from each Fund. The fee is calculated at an annual rate. It is based on the
fund's average daily net assets. The fee schedule is as follows:
Fund Advisory Fee Rate
U.S. Equity Funds 1.00%
International Equity Funds 1.00%
Fixed Income Fund 0.65%
The Advisor pays the expense of printing and mailing prospectuses and sales
materials used for promotional purposes. Subject to regulations and its
obligation to seek best execution, the Advisor may give consideration to
sales of shares of the Fund as a factor in selecting brokers and dealers to
execute portfolio transactions.
The Advisor may, from its management fee, pay certain financial institutions
(which may include banks, securities dealers and other industry
professionals) a "servicing fee" for performing certain administrative
servicing functions for Fund shareholders.
The Administrator
The Funds retain Meridian as administrator to manage its business affairs
and provide administrative services. Some of these services include reporting
to regulators, such as the SEC, and providing necessary office equipment,
personnel and facilities. The Administrator receives a monthly fee from the
Funds. The fee is calculated at an average annual rate of 0.05%, declining to
0.04% for net assets above $500 million. Some employees of Meridian act as
officers of the Funds.
The Distributor
The Funds retain Meridian Clearing Corporation, an affiliate of the Advisor,
to act as the principal distributor of the Fund's shares. Craig T. Callahan
and Erik L. Jonson are officers of the distributor and officers of the Funds.
The Distributor provides its services to the Funds for no additional or
ongoing compensation. The Distributor is responsible for its out of pocket
expenses.
The Funds pay all other expenses for their operations and activities. Each
of the Funds pays its allocable portion of these expenses. The expenses borne
by the Funds include the charges and expenses of any shareholder servicing
agents, custodian fees, legal and auditors' expenses, brokerage commissions for
portfolio transactions, the advisory fee, extraordinary expenses, expenses
of shareholder and trustee meetings, expenses for preparing, printing and
mailing proxy statements, reports and other communications to shareholders, and
expenses of registering and qualifying shares for sale, among others.
ABOUT YOUR ACCOUNT
PRICING SHARES AND RECEIVING SALES PROCEEDS
Here are some procedures you should know when investing in an ICON Fund.
How and when shares are priced
The share price (also called the net asset value or NAV) for each Fund is
calculated at the close of the New York Stock Exchange, normally 4 p.m.
Eastern time, each day the New York Stock Exchange is open for business. To
calculate the NAV, each Fund's assets are valued and totaled, liabilities are
subtracted, and the balance, called net assets, is divided by the number of
shares outstanding. The net asset value per share of each Fund will fluctuate.
When the Funds calculate their share price, they value the securities they
hold at market value. Sometimes market quotes for some securities are not
available or are not representative of market value. Examples would be when
events occur that materially affect the value of a security at a time when
the security is not trading or when the securities are illiquid. In that
case, securities may be valued in good faith at fair value, using
consistently applied procedures decided on by the Board of Trustees. Assets
and liabilities expressed in foreign currencies are converted into U.S.
dollars at the prevailing market rates quoted by one or more banks or dealers
shortly before the close of the Exchange. A Fund's foreign securities may
trade on days that the Exchange is closed and the Fund's daily share price is
not calculated. As a result, the Fund's daily share price may be affected
and you will not be able to purchase or redeem shares.
How your purchase, sale or exchange price is determined
If your request is received by our Transfer Agent in correct form by 4 p.m.
Eastern time, your transaction will be priced at that day's NAV. If your
request is received after 4 p.m. Eastern time, it will be priced at the next
day's NAV.
How you can receive the proceeds from a sale
If your redemption request is received by our Transfer Agent in correct form
by 4 p.m. Eastern time, proceeds are sent within five business days. You may
receive redemption payments in the form of a check or federal wire transfer.
If you use a broker to redeem, the broker may charge a transaction fee for the
redemption. There is no charge for wire redemptions; however, the Fund
reserves the right to charge for this service in the future.
Other purchase information
Dividends begin to accrue after you become a shareholder. The Funds do
not issue share certificates. All shares are held in non-certificate form
registered on the books of the Funds and the Fund's Transfer Agent for
the account of the shareholder. The rights to limit the amount of
purchases and to refuse to sell to any person are reserved by the Fund.
If your check or wire does not clear, you will be responsible for any loss
incurred by the Fund, and a fee of $20 will be charged. If you are
already a shareholder, the Fund can redeem shares from any identically
registered account in the Fund as reimbursement for any loss incurred. You
may be prohibited or restricted from making future purchases in the Fund.
Excessive short-term trading has an adverse impact on effective portfolio
management as well as upon Fund expenses. The Funds have reserved the right
to refuse investments from shareholders who engage in short-term trading.
USEFUL INFORMATION ABOUT DISTRIBUTIONS AND TAXES
DIVIDENDS, CAPITAL GAIN AND TAXES
United States Taxes
Dividends and capital gain distributions are reinvested, without charge, in
additional fund shares, unless you select differently on your new account
form. The share price of the reinvestment will be the net asset value of the
Fund shares computed at the close of business on the date the dividend or
distribution is paid. The advantage of reinvesting distributions arises
from you receiving income dividends and capital gains distributions on a rising
number of shares. Dividends not reinvested are paid by check or wire to
your financial institution.
The Fund expects to distribute almost all of its net investment income, if
any, and any net realized capital gains, at least once each year. Each January,
the Fund will report to its shareholders the Federal tax status of dividends
and distributions paid or declared by the Fund during the preceding calendar
year.
Dividends from taxable net investment income and distributions of net short-
term capital gains paid by the Fund are taxable to shareholders as ordinary
income. This occurs whether the dividend or distribution was received in cash
or reinvested in additional shares. Distributions of net capital gains will be
taxable to shareholders as long-term capital gains, whether paid in cash or
reinvested in additional shares, and regardless of the length of time the
investor has held his shares.
You should consult your own tax advisor about your particular situation.
For more information about other tax matters, see the SAI.
HOW TO INVEST IN THE FUND
Shares of each Fund are sold on a continuous basis. You may invest any
amount you choose as often as you wish. However, the minimum amount of an
initial investment in any one ICON Fund is $1,000. Shares may also be
purchased through a broker-dealer or other financial institution authorized
by the Fund's distributor, and you may be charged a fee for this service by
that broker-dealer or institution.
INITIAL PURCHASE BY MAIL: You may purchase shares of the Fund by completing
and signing the investment application form which accompanies this
Prospectus and mailing it in proper form, together with a check (subject to
the above minimum amounts) made payable to ICON Funds and sent to the address
listed below. If you prefer overnight delivery, use the overnight street
address listed below. Cash is not accepted.
U.S. MAIL: ICON Funds OVERNIGHT: ICON Funds
Mutual Fund Services Mutual Fund Services - Third Floor
Post Office Box 701 615 East Michigan Street
Milwaukee, Wisconsin 53201-0701 Milwaukee, Wisconsin 53202
Your purchase of shares of the Fund will be effected at the next share
price calculated after receipt of your investment. The beneficial owners
custodians will agree to provide the Funds with the states in which the
beneficial owners reside at the time of purchasing shares so that the Funds
can comply with applicable state laws.
INITIAL PURCHASE BY WIRE: You may also purchase shares of each Fund by
wiring federal funds from your bank, which may charge you a fee for doing
so. If the money is to be wired, you must call the Transfer Agent at
1-800-764-0442 for wiring instructions. You should be prepared to provide
the information on the application to the Transfer Agent.
You are required to mail a signed application to the Custodian at the
above address in order to complete your initial wire purchase. Wire orders
will be accepted only on a day on which the Fund, the Custodian and Transfer
Agent are open for business. A wire purchase will not be considered made
until the wired money is received and the purchase is accepted by the Funds.
Any delays which may occur in wiring money, including delays which may occur in
processing by the banks, are not the responsibility of the Fund or the
Transfer Agent. There is presently no fee for the receipt of wired funds,
but the right to charge shareholders for this service is reserved by the Funds.
ADDITIONAL INVESTMENTS: Shareholders may add to their account at any time
by purchasing shares by mail or by wire according to the above instructions.
Shareholders should notify the Transfer Agent at 1-800-764-0442 prior to
sending their wire. The remittance form which is attached to a
shareholder's individual account statement should, if possible, accompany
any investment made through the mail. Every purchase request must
include a shareholder's account registration number in order to assure
that funds are credited properly.
AUTOMATIC INVESTMENT PLAN: You may make regular investments in the Funds
with the Automatic Investment Plan by completing the appropriate section of the
account application and attaching a voided personal check. Investments
may be made monthly to allow dollar-cost averaging by automatically
deducting $100 or more from your bank checking account. You may change the
amount of your monthly purchase at any time.
TAX SHELTERED RETIREMENT PLANS: Since the Funds are oriented to longer
term investments, shares of the Funds may be an appropriate investment for tax
sheltered retirement plans, including: individual retirement plans
(IRAs); simplified employee pensions (SEPs); 401(k) plans; qualified corporate
pension and profit sharing plans (for employees); tax deferred investment
plans (for employees of public school systems and certain types of
charitable organizations); and other qualified retirement plans. You
should contact your adviser for the procedure to open an IRA or SEP plan,
as well as more specific information regarding these retirement plan
options. Consultation with an attorney or tax adviser regarding these plans
is advisable.
HOW TO REDEEM SHARES
Redemptions By Mail: You may redeem any part of your account in the Fund at
no charge by mail. Your request should be addressed to:
ICON Funds
Mutual Fund Services
Post Office Box 701
Milwaukee, Wisconsin 53201
"Proper order" means your request for a redemption must include your letter
of instruction, including the Fund name, account number, account name(s), the
address and the dollar amount or number of shares you wish to redeem. This
request must be signed by all registered share owner(s) in the exact name(s)
and any special capacity in which they are registered. For all redemptions in
excess of $25,000, the Fund requires that signatures be guaranteed by a bank
or member firm of a national securities exchange. Signature guarantees are for
the protection of shareholders. At the discretion of the Fund or Firstar
Mutual Fund Services, a shareholder, prior to redemption, may be required to
furnish additional legal documents to insure proper authorization.
Redemptions By Telephone: If an election is made on the investment
application (or subsequently in writing), you may redeem any part of your
account in any Fund by calling the Transfer Agent at 1-800-764-0442. The
Fund, the Transfer Agent and the Custodian are not liable for following
redemption or exchange instructions communicated by telephone that they
reasonably believe to be genuine. However, if they do not employ reasonable
procedures to confirm that telephone instructions are genuine, they may be
liable for any losses due to unauthorized or fraudulent instructions.
Procedures employed may include recording telephone instructions and
requiring a form of personal identification from the caller.
The telephone redemption and exchange procedures may be terminated at any
time by the Fund or the Transfer Agent. During periods of extreme market
activity, it is possible that shareholders may encounter some difficulty in
telephoning the Fund, although neither the Fund nor the Transfer Agent has ever
experienced difficulties in receiving, and in a timely fashion responding to,
telephone requests for redemptions or exchanges. If you are unable to reach
the Fund by telephone, you may request a redemption or exchange by mail.
Special Redemption Arrangements: Special arrangements may be made by
institutional investors or on behalf of accounts established by brokers,
advisers, banks or similar institutions to have redemption proceeds
transferred by wire to pre-established accounts upon telephone instructions.
For further information call 1-800-764-0442.
Additional Information: If you are not certain of the requirements for a
redemption, please call the Transfer Agent at 1-800-764-0442. Redemptions
specifying a certain date or share price cannot be accepted and will be
returned. You will be mailed the proceeds on or before the fifth business
day following the redemption. However, payment for redemption made against
shares purchased by check will be made only after the check has been collected,
which normally may take up to fifteen days. Also, when the New York Stock
Exchange is closed, or when trading is restricted for any reason other than its
customary weekend or holiday closing, or under any emergency circumstances, as
determined by the SEC, the Funds may suspend redemptions or postpone payment
dates.
Because the Funds incur certain fixed costs in maintaining shareholder
accounts, the Funds reserve the right to require any shareholder to redeem
all of his or her shares in the Funds on 30 days' written notice if the value
of his or her shares in the Fund is less than $5,000 due to redemption, or
other minimum amount as the Fund may determine from time to time. An
involuntary redemption constitutes a sale. You should consult your tax
adviser concerning the tax consequences of involuntary redemptions. A
shareholder may increase the value of his or her shares to the minimum amount
within the 30 day period. Each share is subject to redemption at any time if
the Board of Trustees determines in its sole discretion that failure to
redeem may have materially adverse consequences to all or any of the
shareholders of the Fund. The Funds have the authority to redeem existing
accounts and to refuse a potential account if the Fund reasonably determines
that the failure to redeem, or to prohibit, would have a material adverse
consequence to the Fund and its shareholders.
HOW TO MAKE EXCHANGES
Shares of a Fund may be exchanged for shares of any other ICON Fund based on
the respective net asset values of each Fund involved. An exchange may be made
by following the redemption procedure described above under "How to Redeem
Shares" or if a telephone redemption has been elected, by calling the
transfer agent at 1-800-764-0442. An exchange order is treated the same as a
redemption followed by a purchase and may result in a capital gain or loss
for tax purposes.
FINANCIAL HIGHLIGHTS
The financial highlights for each Fund will help you understand each Fund's
financial performance for the periods indicated. Certain information
reflects financial results for a single Fund share. Total return shows how
much your investment in the Fund increased or decreased during each period,
assuming you reinvested all dividends and distributions.
PricewaterhouseCoopers LLP, independent accountants, audited this
information. Their report is included in the Funds' annual report, which is
available without charge upon request. The Financial Highlights should be
read in conjunction with the financial statements and notes included in the
annual report.
FINANCIAL HIGHLIGHTS
ICON BASIC MATERIALS FUND
For the period from May 5, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
Net Asset Value, Beginning of Period (to be added)$10.90 $10.00
Income from Investment Operations:
Net Investment Income (loss) 0.02 (0.01)
Net Gains or (Losses) on Securities
(both realized and unrealized) (4.08) 0.91
- -------------------------------------------------------------------
Total from Investment Operations (4.06) 0.90
Less Dividends and Distributions:
Dividends (from net investment income) 0.00 0.00
Distributions (from net realized gain) (0.26) 0.00
- ------------------------------------------------------------------
Total Distributions (0.26) 0.00
Net Asset Value, End of Period $6.58 $10.90
Total Return (37.45)% 9.00%**
Net Assets, End of Period (000's) $17,318 $50,251
Average Net Assets for the Period (000's) $27,117 $45,001
Ratio of Expenses to Average Net Assets 1.33% 1.45%*
Ratio of Net Investment Income to
Average Net Assets 0.08% (0.24)%*
Portfolio Turnover Rate 106.70% 32.35%
* Annualized
** Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON CONSUMER CYCLICALS FUND
For the period from July 9, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
Net Asset Value, Beginning of Period(to be added) $10.96 $10.00
Income from Investment Operations:
Net Investment Income (loss) (0.01) (0.01)
Net Gains or (Losses) on Securities
(both realized and unrealized) (3.08) 0.97
- ------------------------------------------------------------------------
Total from Investment Operations (3.09) 0.96
Less Dividends and Distributions:
Dividends (from net investment income) 0.00 0.00
Distributions (from net realized gain)
- ------------------------------------------------------------------------
Net Asset Value, End of Period $7.87 $10.96
Total Return (28.26)% 9.60%**
Net Assets, End of Period (000's) $49,003 $20,916
Average Net Assets for the Period (000's) $39,883 $19,876
Ratio of Expenses to Average Net Assets 1.37% 1.89%*
Ratio of Net Investment income to
Average Net Assets (0.36)% (0.67)%*
Portfolio Turnover Rate 72.42% 0.00%
* Annualized
** Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON ENERGY FUND
For the period from November 5, 1997 (commencement of operations) through
September 30, 1998 and for the fiscal year ended September 30, 1999:
1999 1998
(to be added)
Net Asset Value, Beginning of Period $10.00
Investment from Investment Operations:
Net Investment Income (loss) 0.06
Net Gains or (Losses) on Securities
(both realized and unrealized) (3.71)
- ------------------------------------------------------------
Total from Investment Operations (3.65)
Less Dividends and Distributions:
Dividends (from net investment income) 0.00
Distributions (from net realized gain) 0.00
- -------------------------------------------------------------
Total Distributions 0.00
Net Asset Value, End of Period $6.35
Total Return (36.50)%**
Net assets, End of Period (000's) $12,335
Average Net Assets for the Period (000's) $21,128
Ratio of Expenses to Average Net Assets 1.20%*
Ratio of Net Investment Income to
Average Net Assets 0.51%*
Portfolio Turnover Rate 112.62%
* Annualized
** Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON FINANCIAL SERVICES FUND
For the period from July 1, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
(to be added)
Net Asset Value, Beginning of Period $10.51 $10.00
Income from Investment Operations:
Net Investment Income (loss) 0.04 0.01
Net Gains or (Losses) on Securities
(both realized and unrealized) (1.14) 0.50
- -----------------------------------------------------------------
Total from Investment Operations (1.10) 0.51
Less Dividends and Distributions:
Dividends (from net investment income) (0.01) 0.00
Distribution (from net realized gain) (0.03) 0.00
------------------------------------------------------------
Total Distributions (0.04) 0.00
Net Asset Value, End of Period $9.37 $10.51
Total Return (10.46%) 5.10**
Net Assets, End of Period (000's) $17,211 $32,237
Average Net Assets for the Period (000's) $28,304 $29,803
Ratio of Expenses to Average Net Assets 1.33% 1.70%*
Ratio of Net Investment Income to
Average Net Assets 0.35% 0.12%*
Portfolio Turnover Rate 87.68% 0.00%
* Annualized
**Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON HEALTHCARE FUND
For the period from February 24, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
(to be added)
Net Asset value, Beginning of Period $11.78 $10.00
Income from Investment Operations:
Net investment income (loss0 0.02 (0.04)
Net Gains or (Losses) on Securities
(both realized and unrealized) 0.35 1.82
-------------------------------------------------------------------
Total from Investment Operations 0.37 1.78
Less Dividends and Distributions
Dividends (from net investment income) 0.00 0.00
Distribution (from net realized gain) (0.76) 0.00
----------------------------------------------------------------------
Total Distributions (0.76) 0.00
Net Asset Value, End of Period $11.39 $11.78
Total Return 3.77% 17.80%**
Net Assets, End of Period (000's) $31,153 $77,307
Average Net Assets for the Period (000's) $56,620 $59,164
Ratio of Expenses to Average Net Assets 1.24% 1.45%*
Ratio of Net Investment Income to
Average Net Assets (0.13%) (0.80%)*
Portfolio Turnover Rate 52.16% 71.81%
* Annualized
**Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON LEISURE FUND
For the period from May 9, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
(to be added)
Net Asset Value, Beginning of Period $11.35 $10.00
Income from Investment Operations:
Net Investment Income (loss) 0.02 (0.01)
Net Gains or (Losses) on Securities
(both realized and unrealized) 0.45 1.36
- -----------------------------------------------------------------
Total from Investment Operations 0.47 1.35
Less Dividends and Distributions:
Dividends (from net investment income) 0.00 0.00
Distributions (from net capital gain) (0.03) 0.00
- ----------------------------------------------------------------
Total Distributions (0.03) 0.00
Net Asset Value, End of Period $11.79 $11.35
Total Return 4.18% 13.50%**
Net Assets, End of Period (000's) $54,426 $66,608
Average Net Assets for the Period (000's) $74,443 $45,444
Ratio of Expenses to Average Net Assets 1.30% 1.48%*
Ratio of Net Investment Income to
Average Net Assets 0.07% (0.36%)*
Portfolio Turnover Rate 34.17% 2.52%
* Annualized
** Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON TECHNOLOGY FUND
For the period from February 19, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
(to be added)
Net Asset Value, Beginning of Period $12.96 $10.00
Income from Investment Operations:
Net Investment Income (loss) (0.06) (0.05)
Net Gains or (Losses) on Securities
(both realized and unrealized) (3.31) 3.01
- ------------------------------------------------------------------------
Total from Investment Operations (3.37) 2.96
Less Dividends and Distributions:
Dividends (from net investment income) 0.00 0.00
Distributions (from net realized gain) (0.39) 0.00
------------------------------------------------------------------------
Total Distributions (0.39) 0.00
Net Asset Value, End of Period $9.20 $12.96
Total Return (26.17%) 29.60%**
Net Assets, End of Period (000's) $60,494 $41,849
Average Net Assets for the Period (000's) $73,057 $29,766
Ratio of Expenses to Average Net Assets 1.31% 1.47%*
Ratio of Net Investment Income to
Average Net Assets (0.99%) (0.88)%*
Portfolio Turnover Rate 31.68% 44.57%
* Annualized
** Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON TELECOMMUNICATION & UTILITIES FUND
For the period from July 9, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
(to be added)
Net Asset Value, Beginning of Period $10.63 $10.00
Income from Investment Operations:
Net Investment Income (loss) 0.31 0.06
Net Gains or (Losses) on Securities
(both realized and unrealized) 3.28 0.57
- -----------------------------------------------------------------------------
Total from Investment Operations 3.59 0.63
Less Dividends and Distributions:
Dividends (from net investment income) (0.04) 0.00
Distributions (from net realized gain) (0.01) 0.00
- ----------------------------------------------------------------------------
Total Distributions (0.05) 0.00
Net Asset Value, End of Period $14.17 $10.63
Total Return 33.88% 6.30%**
Net Assets, End of Period (000's) $23,749 $20,422
Average Net Assets for the Period (000's) $36,698 $19,230
Ratio of Expenses to Average Net Assets 1.34% 1.91%*
Ratio of Net Investment Income to
Average Net Assets 2.12% 1.62%*
Portfolio Turnover Rate 155.72% 2.55%
* Annualized
**Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON TRANSPORTATION FUND
For the period from May 9, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
(to be added)
Net Asset Value, Beginning of Period $12.40 $10.00
Income from Investment Operations:
Net investment income (loss) 0.01 0.00
Net Gains or (Losses) on Securities
(both realized and unrealized) (2.71) 2.40
- -----------------------------------------------------------------------------
Total from Investment Operations (2.70) 2.40
Less Dividends and Distributions:
Dividends (from net investment income) (0.01) 0.00
Distributions (from net realized gain) (0.24) 0.00
- ----------------------------------------------------------------------------
Total Distributions (0.25) 0.00
Net Asset Value, End of Period $9.45 $12.40
Total Return (22.08%) 24.00%**
Net Assets, End of Period (000's) $11,318 $22,531
Average Net Assets for the Period (000's) $17,975 $19,459
Ratio of Expenses to Average Net Assets 1.41% 1.61%*
Ratio of Net Investment Income to
Average Net Assets 0.08% (0.04%)*
Portfolio Turnover Rate 10.62% 15.97%
* Annualized
** Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON ASIA REGION FUND
For the period from February 25, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
(to be added)
Net Asset Value, Beginning of Period $9.94 $10.00
Income from Investment Operations:
Net investment income (loss) (0.04) (0.01)
Net Gains or (Losses) on Securities
(both realized and unrealized) (3.81) (0.05)
- ----------------------------------------------------------------------------
Total from Investment Operations (3.85) (0.06)
Less Dividends and Distributions:
Dividends (from net investment income) 0.00 0.00
Distributions (from net realized gain) 0.00 0.00
- -----------------------------------------------------------------------------
Total Distributions 0.00 0.00
Net Asset Value, End of Period $6.09 $9.94
Total Return (38.73%) (0.60)%**
Net Assets, End of Period (000's) $26,730 $58,279
Average Net Assets for the Period (000's) $45,361 $45,191
Ratio of Expenses to Average Net Assets 1.65% 1.66%*
Ratio of Net Investment Loss to
average net assets (0.45%) (0.23)%*
Portfolio Turnover Rate 69.57% 0.00%
* Annualized
** Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON NORTH EUROPE REGION FUND
For the period from February 18, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
(to be added)
Net Asset Value, Beginning of Period 11.06 $10.00
Income from Investment Operations:
Net investment income (loss) (0.02) 0.07
Net Gains or (Losses) on Securities
(both realized and unrealized) 0.79 0.99
- ----------------------------------------------------------------------------
Total from Investment Operations 0.77 1.06
Less Dividends and Distributions:
Dividends (from net investment income) (0.06) 0.00
Distributions (from net realized gain) (0.14) 0.00
- -----------------------------------------------------------------------------
Total Distributions (0.20) 0.00
Net Asset Value, End of Period $11.63 $11.06
Total Return 7.00% 10.60%**
Net Assets, End of Period (000's) $39,726 $49,947
Average Net Assets for the Period (000's) $49,406 $36,212
Ratio of Expenses to Average Net Assets 1.54% 1.66%*
Ratio of Net Investment Income to
Average Net Assets 0.41% 1.34%*
Portfolio Turnover Rate 57.84% 13.89%
* Annualized
** Total Return for periods less than one year is not annualized
FINANCIAL HIGHLIGHTS
ICON SOUTH EUROPE REGION FUND
For the period from February 20, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
(to be added)
Net Asset Value, Beginning of Period $11.90 $10.00
Income from Investment Operations:
net investment income (loss) (0.23) 0.10
Net Gains or (Losses) on Securities
(both realized and unrealized) 0.93 1.80
Total from Investment Operations 0.70 1.90
Less Dividends and Distributions:
Dividends (from net investment income) (0.07) 0.00
Distributions (from net realized gain) (0.66) 0.00
- ----------------------------------------------------------------------------
Total Distributions (0.73) 0.00
Net Asset Value, End of Period $11.87 $11.90
Total Return 6.11% 19.00%**
Net Assets, End of Period (000's) $9,452 $21,088
Average Net Assets for the Period (000's) $20,263 $15,055
Ratio of Expenses to Average Net Assets 1.56%*** 1.69%*
Ratio of Net Investment Income to
Average Net Assets (0.26%)*** 1.92%*
Portfolio Turnover Rate 113.55% 7.29%
* Annualized
** Total Return for periods less than one year is not annualized
*** Includes reimbursement for fees and expenses. If these fees and
expenses had not been reimbursed, the ratio of expenses to average net
assets would have been 2.10% and the ratio of net investment income to
average net assets would have been (0.79%)
FINANCIAL HIGHLIGHTS
ICON SHORT-TERM FIXED INCOME FUND
For the period from February 7, 1997 (commencement of operations) through
September 30, 1997 and the fiscal years ended September 30, 1998 and 1999:
1999 1998 1997
(to be added)
Net Asset Value, Beginning of Period $10.03 $10.00
Income from Investment Operations:
net investment income (loss) 0.76 0.47
Net Gains or (Losses) on Securities
(both realized and unrealized) (0.14) 0.03
- ----------------------------------------------------------------------
Total from Investment Operations 0.62 0.50
Less Dividends and Distributions:
Dividends (from net investment income) (0.53) (0.47)
Distributions (from net realized gain) (0.33) 0.00
- ----------------------------------------------------------------------
Total Distributions (0.86) (0.47)
Net Asset Value, End of Period $9.79 $10.03
Total Return 6.55% 3.18%**
Net Assets, End of Period (000's) $5,350 $81,382
Average Net Assets for the Period (000's) $17,542 $128,897
Ratio of Expenses to Average Net Assets 0.11%*** 1.10%*
Ratio of Net Investment Income to
Average Net Assets 5.66%*** 4.66%*
Portfolio Turnover Rate 163.75% 297.62%
* Annualized
** Total Return for periods less than one year is not annualized
***Includes change in accounting estimate. If this change had not been made
the ratio of expenses to average net assets would have been 0.84% and the ratio
of net investment income to average net assets would have been 4.93%.
FOR FURTHER INFORMATION
More information about the Funds is available to you free of charge. The
Funds' Annual and Semi-Annual Reports contain the Funds' financial statements,
portfolio holdings, and historical performance. You will also find a
discussion of the market conditions and investment strategies that
significantly affected the Funds' performance in these reports. In addition,
a current Statement of Additional Information (SAI) containing more detailed
information about the Funds and their policies has been filed with the
Securities and Exchange Commission and is incorporated by reference as part
of this Prospectus. You can request copies of the Annual and Semi-Annual
Reports and the SAI from the ICON Funds:
BY TELEPHONE Call 1-888-389-4266
BY MAIL ICON Funds
c\o Meridian Investment Management Corporation
12835 East Arapahoe Road, Tower II
Englewood, Colorado 80112
IN PERSON Meridian Investment Management Corporation
12835 East Arapahoe Road, Tower II
Englewood, Colorado 80112
ON THE INTERNET www.iconfunds.com or text-only
versions of fund documents can be
viewed or downloaded from the
Securities and Exchange Commission's
internet site at www.sec.gov
BY MAIL OR IN PERSON FROM THE Visit or write:
SECURITIES AND EXCHANGE COMMISSION SEC's Public Reference Section
(YOU WILL PAY A COPYING FEE) Washington, D.C. 20549-6009
1-800-SEC-0330
ICON Funds' SEC File No. 811-07883
November 22, 1999
STATEMENT OF ADDITIONAL INFORMATION
ICON Basic Materials Fund
ICON Capital Goods Fund
ICON Consumer Cyclicals Fund
ICON Consumer Staples Fund
ICON Energy Fund
ICON Financial Services Fund
ICON Healthcare Fund
ICON Leisure Fund
ICON Technology Fund
ICON Telecommunication & Utilities Fund
ICON Transportation Fund
ICON Asia Region Fund
ICON South Pacific Region Fund
ICON North Europe Region Fund
ICON South Europe Region Fund
ICON Western Hemisphere Fund
ICON Short-Term Fixed Income Fund
This Statement of Additional Information is not a prospectus. It relates to
the Prospectus for the ICON Funds listed above, dated November 22, 1999, as it
may be amended or supplemented from time to time. The SAI should be read in
conjunction with the Prospectus and Annual Reports, all of which may be
obtained by writing the Advisor at 12835 E. Arapahoe Road Tower II, PH,
Englewood, CO 80112 or by calling 1-888-389-4266.
TABLE OF CONTENTS
THE ICON FUNDS 3
INVESTMENT POLICIES AND RESTRICTIONS 3
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS
AND RISK CONSIDERATIONS 5
TEMPORARY DEFENSIVE POSITION 14
PORTFOLIO TURNOVER 5
TRUSTEES AND OFFICERS 15
PRINCIPAL SHAREHOLDERS 16
THE INVESTMENT ADVISOR 17
ADMINISTRATIVE SERVICES 18
CUSTODIAN 19
TRANSFER AGENT 19
INDEPENDENT ACCOUNTANTS AND COUNSEL 19
DISTRIBUTOR 19
PORTFOLIO TRANSACTIONS-BROKERAGE ALLOCATION 19
PURCHASE AND REDEMPTION OF SHARES 20
DETERMINATION OF SHARE OFFERING PRICE 21
TAX STATUS 21
OTHER TAX CONSIDERATIONS 22
CALCULATION OF PERFORMANCE DATA 24
Total Return 25
Yield 26
Non-standardized Total Return 26
ADDITIONAL INFORMATION ABOUT THE FUNDS 26
FINANCIAL STATEMENTS 28
THE ICON FUNDS
The ICON Funds is a no-load, no 12b-1 fee mutual fund registered with the
SEC. It was organized as a "business trust" under the laws of the
Commonwealth of Massachusetts in September 19, 1996. There are numerous
series within the Funds. Each series represents a separate non-diversified
portfolio of securities.
INVESTMENT POLICIES AND RESTRICTIONS
The Prospectus describes the investment objective of each of the Funds and
the principal investment policies and strategies used to achieve that
objective. It also describes the principal risks of investing in each Fund.
This section contains supplemental information concerning the types of
securities and other instruments in which the Funds may invest, the
investment policies and portfolio strategies that the Funds may utilize and
certain risks attendant to those investments, policies and strategies.
Each Fund has adopted investment restrictions as fundamental and policies.
These restrictions cannot be changed without approval by the holders of a
majority of the outstanding voting securities of the Fund. This means the
lesser of (i) 67% of the Fund's outstanding shares present at a meeting at
which more than 50% of the outstanding shares of the Fund are represented
either in person or by proxy, or (ii) more than 50% of the Fund's outstanding
shares.
No Fund may:
(1) Issue senior securities.
(2) Borrow money, except that the Fund may borrow not in excess of
33 1/3% of the total assets of the Fund from banks as a
temporary measure for extraordinary purposes.
(3) Underwrite the securities of other issuers.
(4) Purchase or sell real property (including limited
partnership interests, but excluding readily marketable
interests in real estate investment trusts or readily
marketable securities or companies which invest in real estate).
(5) Engage in the purchase or sale of commodities or commodity
contracts, except that the Funds may invest in financial
and currency futures contracts and related options for bona fide
hedging purposes and to provide exposure while attempting to
reduce transaction costs.
(6) Lend its assets, except that purchases of debt securities in
furtherance of the Fund's investment objective will not
constitute lending of assets, and except that the Fund may
lend portfolio securities with an aggregate market value of not
more than one-third of the Fund's net assets.
(7) Purchase any security on margin, except that it may obtain
short-term credits as are necessary for clearance of securities
transactions. This restriction does not apply to bona fide
hedging activity utilizing financial futures and related options.
(8) Make short sales in situations where the security is not owned
by a Fund.
(9) Acquire more than 10% of the voting securities of any one issuer.
(10) Invest more than 5% of the value of its total assets, with
respect to 50% of a Fund, in securities of any one issuer,
except such limitation shall not apply to obligations issued or
guaranteed by the United States Government, its agencies or
instrumentalities.
The following investment restrictions may be changed by the Board
of Trustees without a shareholder vote:
No Fund may:
(11) Invest in companies for the purpose of exercising control of
management.
(12) Hypothecate, pledge, or mortgage any of its assets, except to
secure loans as a temporary measure for extraordinary purposes
and except as may be required to collateralize letters of
credit to secure state surety bonds.
(13) Invest more than 15% of its net assets in illiquid securities.
(14) Invest in oil, gas or other mineral leases.
(15) In connection with bona fide hedging activities, invest more
than 5% of its assets as initial margin deposits or premiums for
futures contracts and provided that said Funds may enter
into futures contracts and option transactions only to the
extent that obligations under such contracts or transactions
represent not more than 100% of a Fund's assets.
(16) Invest in shares issued by other investment companies except
for cash management purposes and as permitted under applicable
laws and regulations.
If a percentage restriction is adhered to at the time of investment, a later
increase or decrease in percentage, resulting from a change in values of
portfolio securities or amount of net assets, will not be considered a
violation of any of these restrictions.
ADDITIONAL INFORMATION ABOUT FUND INVESTMENTS
AND RISK CONSIDERATIONS
This section contains a more detailed discussion of some of the investments
the Funds may make and some of the techniques it may use, as described in the
Prospectus.
Equity Securities: Except for the Short-Term Fixed Income Fund, each Fund
may invest in equity securities, including common stocks, preferred stocks and
securities convertible into common stocks, such as rights, warrants and
convertible debt securities. Equity securities may be issued by either
established, well-capitalized companies or newly-formed, small-cap
companies, and may trade on regional or national stock exchanges or in the
over-the-counter market.
Debt Securities: Each Fund may temporarily invest in short-term debt
securities. Each Fund will limit its investment in fixed income securities
to corporate debt securities and U.S. government securities. Debt securities
are generally considered to be interest rate sensitive. This means that their
value will generally decrease when interest rates rise and increase when
interest rates fall. Securities with shorter maturities, while offering
lower yields, generally provide greater price stability than longer term
securities and are less affected by changes in interest rates.
Corporate Debt Securities: Corporate debt securities are long and short-
term debt obligations issued by companies (such as publicly issued and
privately placed bonds, notes and commercial paper). The Fund will only
invest in corporate debt securities rated A or higher by Standard & Poor's
Corporation or Moody's Investors Services, Inc.
U.S. Treasury Obligations: U.S. Treasury obligations consist of bills,
notes, and bonds issued by the U.S. Treasury as well as separately traded
interest and principal components parts of those obligations, known as
Separately Traded Registered Interest and Principal Securities ("STRIPS")
that are transferable through the federal book-entry system.
U.S. Treasury STRIPS: U.S. Treasury STRIPS are sold as zero coupon
securities, which means that they are sold at a substantial discount and
redeemed at face value at their maturity date without interim cash payments
of interest or principal. This discount is accreted over the life of the
security for both accounting and tax purposes. Because of these features,
those securities may be subject to greater interest rate volatility than
interest-paying investments.
U.S. Government Obligations: U.S. government obligations may be backed by
the credit of the government as a whole or only by the issuing agency. U.S.
Treasury bonds, notes, and bills and some agency securities, such as those
issued by the Federal Housing Administration and the Government National
Mortgage Association (GNMA), are backed by the full faith and credit of the
U.S. government as to payment of principal and interest and are the highest
quality government securities. Other securities issued by U.S. government
agencies, such as securities issued by the Federal Home Loan Banks and the
Federal Home Loan Mortgage Corporation, are supported only by the credit of
the agency that issued them, and not by the U.S. government. Securities
issued by the Federal Farm Credit System, the Federal Land Banks, and the
Federal National Mortgage Association (FNMA) are supported by the agency's
right to borrow money from the U.S. Treasury under certain circumstances, but
are not backed by the full faith and credit of the U.S. government.
Forward Commitments and Reverse Repurchase Agreements: A Fund will direct
its Custodian to place cash or U.S. government obligations in a separate
account of the Fund in an amount equal to the commitments of the Funds to
purchase or repurchase securities as a result of its forward commitment or
reverse repurchase agreement obligations. With respect to forward commitments
to sell securities, the Fund will direct its Custodian to place the
securities in a separate account. A Fund will direct its Custodian to
segregate such assets for when, as and if issued commitments only when it
determines that issuance of the security is probable. When a separate account
is maintained, the securities deposited in the separate account will be
valued daily at market for the purpose of determining the adequacy of the
securities in the account. To the extent funds are in a separate account,
they will not be available for new investment or to meet redemptions.
Commitments to purchase securities on a when, as and if issued basis will
not be recognized in the portfolio of a Fund until the Advisor determines that
issuance of the security is probable. At such time, a Fund will record the
transaction and, in determining its net asset value, will reflect the value
of the security daily.
Securities purchased on a forward commitment basis and subject to reverse
repurchase agreements are subject to changes in market value based upon the
public's perception of the creditworthiness of the issuer and changes in the
level of interest rates (which will generally result in all of those
securities changing in value in the same way; i.e., all those securities
experiencing appreciation when interest rates decline and depreciation when
interest rates rise). Therefore, if in order to achieve a higher level of
income, a Fund remains substantially fully invested at the same time that it
has purchased on a forward commitment basis or entered into reverse
repurchase transactions, there will be a possibility that the market value of
the Fund's assets will have greater fluctuation.
Leveraging: Leveraging a Fund creates an opportunity for increased net income
but, at the same time, creates special risk considerations. For example,
leveraging may exaggerate changes in the net asset value of Fund shares and
in the yield on the Fund's portfolio. Although the principal of such borrowings
will be fixed, the Fund's assets may change in value during the time the
borrowing is outstanding. Leveraging will create interest expenses for the
Fund which can exceed the income from the assets retained. To the extent the
income derived from securities purchased with borrowed funds exceeds the
interest the Fund will have to pay, the Fund's net income will be greater
than if leveraging were not used. Conversely, if the income from the assets
retained with borrowed funds is not sufficient to cover the cost of
leveraging, the net income of the Fund will be less than if leveraging were
not used, and therefore the amount available for distribution to shareholders
will be reduced.
Put and Call Options: Each Fund may purchase and sell futures contracts and
options (i) to hedge against changes in market conditions; and (ii) to
provide market exposure while attempting to reduce transaction costs.
Purchasing Put Options: Each Fund may purchase put options on portfolio
securities to hedge against adverse movements in the prices of these
securities. A put option gives the buyer of the option, upon payment of a
premium, the right to sell a security to the writer of the option on or
before a fixed date at a predetermined price. A Fund will realize a gain
from the exercise of a put option if, during the option period, the price of
the security declines by an amount in excess of the premium paid. A Fund
will realize a loss equal to all or a portion of the premium paid for the
option if the price of the security increases or does not decrease by more
than the premium.
By purchasing a put option, a Fund obtains the right (but not the obligation)
to sell the option's underlying instrument at a fixed "strike" price. In return
for this right, the Fund pays the current market price for the option (known as
the option premium). Options have various types of underlying instruments,
including specific securities, indices of securities prices, and futures
contracts. A Fund may terminate its position in a put option it has purchased
by allowing it to expire or by exercising the option. If the option is
allowed to expire, the Fund will lose the entire premium it paid. If the
Fund exercises the option, it completes the sale of the underlying instrument
at the "strike" price. A Fund also may terminate a put option position by
closing it out in the secondary market at its current price, if a liquid
secondary market exists.
The buyer of a typical put option can expect to realize a gain if security
prices fall substantially. However, if the underlying instrument's price
does not fall enough to offset the cost of purchasing the option, a put buyer
can expect to suffer a loss (limited to the amount of the premium paid, plus
related transaction costs).
The features of call options are essentially the same as those of put
options, except that the purchaser of a call option obtains the right to
purchase, rather than sell, the underlying instrument at the option's
"strike" price. A call buyer typically attempts to participate in potential
price increases of the underlying instrument with risk limited to the cost of
the option if security prices fall. At the same time, the buyer can expect to
suffer a loss if the underlying prices do not rise sufficiently to offset the
cost of the option.
Writing Put Options: When a Fund writes a put option, it takes the opposite
side of the transaction from the option's purchaser. In return for receipt of
the premium, the Fund assumes the obligation to pay the "strike" price for the
option's underlying instrument if the other party to the option chooses to
exercise it. When writing an option on a futures contract the Fund will be
required to make margin payments for futures contracts. The Fund may seek to
terminate its position in a put option it writes before exercise by closing
out the option in the secondary market at its current price. If the secondary
market is not liquid for a put option the Fund has written, however, the Fund
must continue to be prepared to pay the "strike" price while the option is
outstanding, regardless of price changes, and must continue to segregate
assets to cover its position.
If the underlying prices rise, a put writer would generally expect to
profit. Although its gain would be limited to the amount of the premium it
received. If security prices remain the same over time, the writer also may
profit, because it should be able to close out the option at a lower price.
If the underlying prices fall, the put writer would expect to suffer a loss.
This loss should be less than the loss from purchasing the underlying
instrument directly, however, because the premium received for writing the
option should mitigate the effects of the decline.
Writing a call option obligates a Fund to sell or deliver the option's
underlying instrument, in return for the "strike" price, upon exercise of
the option. The characteristics of writing call options are similar to those of
writing put options, except that writing calls generally is a profitable
strategy if the underlying prices remain the same or fall. Through receipt
of the option premium, a call writer mitigates the effects of a price decline.
At the same time, because a call writer must be prepared to deliver the
underlying instrument in return for the "strike" price, even if its current
value is greater, a call writer gives up some ability to participate in the
underlying price increases.
Purchasing Call Options: Each Fund may purchase call options on securities
which each Fund intends to purchase to take advantage of anticipated
positive movements in the prices of these securities. Each Fund will realize
a gain from the exercise of a call option if, during the option period, the
price of the underlying security to be purchased increases by more than the
amount of the premium paid. A Fund will realize a loss equal to all or a
portion of the premium paid for the option if the price of the underlying
security decreases or does not increase by more than the premium.
Selling (or Writing) Covered Call Options: Each Fund may sell (or write)
covered call options on portfolio securities to hedge against adverse
movements in the prices of these securities. A call option gives the buyer
of the option, upon payment of a premium, the right to call upon the writer
to deliver a security on or before a fixed date at a predetermined price,
referred to as the strike price. If the price of the hedged security should
fall or remain below the strike price, the Fund will not be called upon to
deliver the security, and the Fund will retain the premium received for the
option as additional income, offsetting all or part of any decline in the
value of the security. The hedge provided by writing covered call options is
limited to a price decline in the security of no more than the option premium
received by the Fund for writing the option. If the security owned by the
Fund ering levels of demand in the options and futures markets and the
securities or precious metal markets, structural differences in how options
and futures and securities or precious metal are traded, or imposition of
daily price fluctuation limits or trading halts. The Fund may purchase or
sell options and futures contracts with a greater or lesser value than the
securities or precious metal it wishes to hedge or intends to
purchase in order to attempt to compensate for differences in volatility
between the contract and the securities or precious metals, although this may
not be successful in all cases. If price changes in the Fund's options or
futures positions are poorly correlated with its other investments, the
positions may fail to produce anticipated gains or result in losses that are
not offset by gains in other investments.
Liquidity of Options and Futures Contracts: There is no assurance a liquid
secondary market will exist for any particular options or futures contract
at any particular time. Options may have relatively low trading volume and
liquidity if their "strike" prices are not close to the underlying
instrument or precious metal's current price. In addition, exchanges may
establish daily price fluctuation limits for options and futures contracts,
and may halt trading if a contract's price moves upward or downward more than
the limit in a given day. On volatile trading days when the price fluctuation
limit is reached or a trading halt is imposed, it may be impossible for the
Fund to enter into new positions or close out existing positions. If the
secondary market for a contract is not liquid because of price fluctuation
limits or otherwise, it could prevent prompt liquidation of unfavorable
positions, and potentially could require the Fund to continue to hold a
position until delivery or expiration regardless of changes in its value. As
a result, the Fund's access to other assets held to cover its options or
futures positions also could be impaired. In addition, one of the
requirements for qualification as a regulated investment company for tax
purposes in that less than 30% of the Fund's gross income be derived from
gains from the sale or other disposition of securities held for less than three
months. Accordingly, the Fund may be restricted in effecting closing
transactions within three months after entering into an option or futures
contract.
Closing Transactions: Each Fund may dispose of an option written by the
Fund by entering into a "closing purchase transaction" for an identical option
and may dispose of an option purchased by the Fund by entering into a
"closing sale transaction" for an identical option. In each case, the
closing transaction will have the effect of terminating the rights of the
option holder and the obligations of the option purchaser and will result in
a gain or loss to the Fund based upon the relative amount of the premiums
paid or received for the original option and the closing transaction. A Fund
may sell (or write) put options solely for the purpose of entering into
closing sale transactions.
Limitations: Each Fund will purchase and sell only options that are listed
on a securities exchange or quoted on NASDAQ. A Fund will not purchase any
option if, immediately thereafter, the aggregate market value of all
outstanding options purchased and written by the Fund would exceed 5% of the
Fund's total assets. A Fund will not effect a futures or option transaction,
if immediately thereafter, the aggregate value of the Fund's securities
subject to outstanding call options would exceed 100% of the value of the
Fund's total assets.
Index Futures Contracts and Related Options: In order to remain fully
invested, and to reduce transaction costs, each Fund may purchase and sell
index futures contracts or purchase and sell options thereon as a hedge
against changes in market conditions. An index futures contract is an
agreement pursuant to which two parties agree to take or make delivery of an
amount of cash equal to a specified dollar or other currency amount times the
difference between the index value at the close of the last trading day of
the contract and the price at which the futures contract is originally
struck. No physical delivery of the underlying securities are made.
Segregated Assets and Covered Positions: When purchasing a stock index
futures contract, selling an uncovered call option, or purchasing securities
on a when-issued or delayed delivery basis, a Fund will restrict cash, which
may be invested in repurchase obligations or liquid securities. When
purchasing a stock index futures contract, the amount of restricted cash or
liquid securities, when added to the amount deposited with the broker as
margin, will be at least equal to the market value of the futures contract
and not less than the market price at which the futures contract was
established. When selling an uncovered call option, the amount of restricted
cash or liquid securities, when added to the amount deposited with the broker
as margin, will be at least equal to the value of securities underlying the
call option and not less than the strike price of the call option. When
purchasing securities on a when-issued or delayed delivery basis, the amount
of restricted cash or liquid securities will be at least equal to the Fund's
when-issued or delayed delivery commitments.
The restricted cash or liquid securities will either be identified as being
restricted in a Fund's accounting records or physically segregated in a
separate account at Firstar Trust Company, the Fund's custodian. For the
purpose of determining the adequacy of the liquid securities which have been
restricted, the securities will be valued at market or fair value. If the
market or fair value of such securities declines, additional cash or liquid
securities will be restricted on a daily basis so that the value of the
restricted cash or liquid securities, when added to the amount deposited with
the broker as margin, equals the amount of such commitments by a Fund.
Fund assets need not be segregated if a Fund "covers" the futures contract
or call option sold. For example, the Fund could cover a futures or forward
contract which it has sold short by owning the securities or currency
underlying the contract. A Fund may also cover this position by holding a
call option permitting the Fund to purchase the same futures or forward
contract at a price no higher than the price at which the sell position was
established. A Fund could cover a call option which it has sold by holding
the same currency or security (or, in the case of a stock index, a portfolio
of stock substantially replicating the movement of the index) underlying the
call option. The Fund may also cover by holding a separate call option of the
same security or stock index with a strike price no higher than the strike
price of the call option sold by the Fund. The Fund could cover a call
option which it has sold on a futures contract by entering into a long
position in the same futures contract at a price no higher than the strike
price of the call option or by owning the securities or currency underlying
the futures contract. The Fund could also cover a call option which it has
sold by holding a separate call option permitting it to purchase the same
futures contract at a price no higher than the strike price of the call
option sold by the Fund.
OTC Options: Unlike exchange-traded options, which are standardized with
respect to the underlying instrument, expiration date, contract size, and
"strike" price, the terms of over-the-counter options i.e., options not
traded on exchanges ("OTC options"), generally are established through
negotiation with the other party to the option contract. While this type of
arrangement allows a Fund greater flexibility to tailor an option to its
needs, OTC options generally involve greater credit risk than exchange-traded
options, which are guaranteed by the clearing organization of the exchanges
where they are traded. The risk of illiquidity also is greater with OTC
options, since these options generally can be closed out only by negotiation
with the other party to the option.
Illiquid Investments: Illiquid investments are investments that cannot be
sold or disposed of in the ordinary course of business at approximately the
prices at which they are valued. Under the supervision of the Board of
Trustees, the Advisor determines the liquidity of a Fund's investments and,
through reports from the Advisor, the Board monitors trading activity in
illiquid investments. In determining the liquidity of the Fund's investments,
the Advisor may consider various factors, including (i) the frequency of
trades and quotations, (ii) the number of dealers and prospective purchasers
in the marketplace, (iii) dealer undertakings to make a market, (iv) the
nature of the security (including any demand or tender features), and (v) the
nature of the marketplace for trades (including the ability to assign or
offset the Fund's rights and obligations relating to the investment).
Investments currently considered by the Trust to be illiquid include
repurchase agreements not entitling the holder to payments of principal and
interest within seven days, over-the-counter options, and restricted
securities. However, with respect to OTC options which the Fund
writes, all or a portion of the value of the underlying instrument may be
illiquid depending on the assets held to cover the option and the nature and
terms of any agreement the Fund may have to close out the option before
expiration. In the absence of market quotations, illiquid investments are
priced at fair value as determined in good faith by the Advisor, subject to
review of the Board of Trustees. If, through a change in values, net assets
or other circumstances, the Fund were in a position where more than 15% of
its net assets were invested in illiquid securities, it would seek to take
appropriate steps to protect liquidity.
Foreign Securities: Each International Fund invests in foreign securities.
Foreign investments can involve significant risks in addition to the risks
inherent in U.S. investments. The value of securities denominated in or
indexed to foreign currencies, and of dividends and interest from those
securities, can change significantly when foreign currencies strengthen or
weaken relative to the U.S. dollar. Foreign securities markets generally
have less trading volume and less liquidity than U.S. markets. Further,
prices on some foreign markets can be highly volatile. Many foreign
countries lack uniform accounting and disclosure standards comparable to
those applicable to U.S. companies, and it may be more difficult to obtain
reliable information regarding an issuer's financial condition and
operations. In addition, the costs of foreign investing, including
withholding taxes, brokerage commissions, and custodial costs, generally are
higher than for U.S. investments.
Foreign markets may offer less protection to investors than U.S. markets.
Foreign issuers, brokers, and securities markets may be subject to less
government supervision. Foreign security trading practices, including those
involving the release of assets in advance of payment, may invoke increased
risks in the event of a failed trade or the insolvency of a broker-dealer,
and may involve substantial delays. It also may be difficult to enforce legal
rights in foreign countries.
Investing abroad also involves different political and economic risks.
Foreign investments may be affected by actions of foreign governments
adverse to the interests of U.S. investors, including the possibility of
expropriation or nationalization of assets, confiscatory taxation,
restrictions on U.S. investment or on the ability to repatriate assets or
convert currency into U.S. dollars, or other government intervention. There
may be a greater possibility of default by foreign governments or foreign
government-sponsored enterprises. Investments in foreign countries also
involve a risk of local political, economic or social instability, military
action or unrest, or adverse diplomatic developments. There is no assurance
that an Advisor will be able to anticipate or counter these potential events
and their impacts on the Fund's share price.
The considerations noted above generally are intensified for investments in
developing countries. Developing countries may have relatively unstable
governments, economies based on only a few industries, and securities
markets that trade a small number of securities.
The Fund may invest in foreign securities that impose restrictions on
transfer within the U.S. or to U.S. persons. Although securities subject to
transfer restrictions may be marketable abroad, they may be less liquid than
foreign securities of the same class that are not subject to those
restrictions.
Foreign Currency Transactions: Investments in foreign companies usually
involve use of currencies of foreign countries. A Fund also may hold cash and
cash-equivalent investments in foreign currencies. The value of the Fund's
assets as measured in U.S. dollars will be affected by changes in currency
exchange rates and exchange control regulations. The Fund may, as appropriate
markets are developed, but is not required to, engage in currency
transactions including cash market purchases at the spot rates, forward
currency contracts, exchange listed currency futures, exchange listed and
over-the-counter options on currencies, and currency swaps for two purposes.
One purpose is to settle investment transactions. The other purpose is to
try to minimize currency risks.
All currency transactions involve a cost. Although foreign exchange dealers
generally do not charge a fee, they do realize a profit based on the
difference (spread) between the prices at which they are buying and selling
various currencies. Commissions are paid on futures options and swaps
transactions, and options require the payment of a premium to the seller.
A forward contract involves a privately negotiated obligation to purchase or
sell at a price set at the time of the contract with delivery of the
currency generally required at an established future date. A futures
contract is a standardized contract for delivery of foreign currency traded
on an organized exchange that is generally settled in cash. An option gives
the right to enter into a contract. A swap is an agreement based on a
nominal amount of money to exchange the differences between currencies.
The Fund will generally use spot rates or forward contracts to settle a
security transaction or handle dividend and interest collection. When a
Fund enters into a contract for the purchase or sale of a security
denominated in a foreign currency or has been notified of a dividend or
interest payment, it may desire to lock in the price of the security or
the amount of the payment in dollars. By entering into a spot rate or
forward contract, the Fund will be able to protect
itself against a possible loss resulting from an adverse change in the
relationship between different currencies from the date the security is
purchased or sold to the date on which payment is made or received or when
the dividend or interest is actually received.
A Fund may use forward or futures contracts, options, or swaps when the
investment manager believes the currency of a particular foreign country may
suffer a substantial decline against another currency. For example, it may
enter into a currency transaction to sell, for a fixed amount of dollars, the
amount of foreign currency approximating the value of some or all of the Fund's
portfolio securities denominated in such foreign currency. The precise
matching of the securities transactions and the value of securities involved
generally will not be possible. The projection of short-term currency market
movements is extremely difficult and successful execution of a short-term
strategy is highly uncertain.
A Fund will not enter into a foreign forward contract for a term of more
than one year or for purposes of speculation. Investors should be aware that
hedging against a decline in the value of a currency in this manner does not
eliminate fluctuations in the prices of portfolio securities or prevent
losses if the prices of those securities decline. Furthermore, hedging
transactions preclude the opportunity for gain if the value of the hedging
currency should rise. Foreign forward contracts may, from time to time, be
considered illiquid, in which case they would be subject to a Fund's
limitation on investing in illiquid securities.
A Fund may cross-hedge currencies by entering into transactions to purchase
or sell one or more currencies that are expected to decline in value relative
to other currencies in which a Fund has (or expects to have) portfolio
exposure.
A Fund may engage in proxy hedging. Proxy hedging is often used when the
currency to which a fund's portfolio is exposed is difficult to hedge. Proxy
hedging entails entering into a forward contract to sell a currency whose
changes in value are generally considered to be linked to a currency or
currencies in which some or all of the Fund's portfolio securities are or
are expected to be denominated, and simultaneously buy U.S. dollars. The amount
of the contract would not exceed the value of the Fund's securities denominated
in linked securities.
A Fund will not enter into a currency transaction or maintain an exposure as
a result of the transaction when it would obligate a Fund to deliver an amount
of foreign currency in excess of the value of the Fund's portfolio securities
or other assets denominated in that currency. The Fund will designate cash or
securities in an amount equal to the value of the Fund's total assets
committed to consummating the transaction. If the value of the securities
declines, additional cash or securities will be designated on a daily basis
so that the value of the cash or securities will equal the amount of the Fund's
commitment.
On the settlement date of the currency transaction, a Fund may either sell
portfolio securities and make delivery of the foreign currency or retain the
securities and terminate its contractual obligation to deliver the foreign
currency by purchasing an offsetting position. It is impossible to forecast
what the market value of portfolio securities will be on the settlement date
of a currency transaction. Accordingly, it may be necessary for the Fund to
buy additional foreign currency on the spot market (and bear the expense of
such purchase) if the market value of the securities are less than the amount
of foreign currency the Fund is obligated to deliver and a decision is made to
sell the securities and make delivery of the foreign currency. Conversely,
it may be necessary to sell on the spot market some of the foreign currency
received on the sale of the portfolio securities if its market value exceeds
the amount of foreign currency the Fund is obligated to deliver. The Fund
will realize gains or losses on currency transactions.
The Fund may also buy put options and write covered call options on foreign
currencies to try to minimize currency risks. The risk of buying an option
is the loss of premium. The risk of selling (writing) an option is that the
currency option will minimize the currency risk only up to the amount of the
premium, and then only if rates move in the expected direction. If this does
not occur, the option may be exercised and a Fund would be required to buy the
underlying currency at the loss which may not be offset by the amount of the
premium. Through the writing of options on foreign currencies, the Fund may
also be required to forego all or a portion of the benefits which might
otherwise have been obtained from favorable movements on exchange rates. All
options written on foreign currencies will be covered; that is, the Fund will
own securities denominated in the foreign currency, hold cash equal to its
obligations or have contracts that offset the options.
The Fund may construct a synthetic foreign currency investment, sometimes
called a structured note, by (a) purchasing a money market instrument which
is a note denominated in one currency, generally U.S. dollars, and (b)
concurrently entering into a forward contract to deliver a corresponding
amount of that currency in exchange for a different currency on a future
date and at a specified rate of exchange. Because the availability of a
variety of highly liquid short-term U.S. dollar market instruments, or notes,
a synthetic money market position utilizing such U.S. dollar instruments
may offer greater liquidity than direct investment in foreign currency.
Securities Issued on a When-Issued or Delayed Delivery Basis: Each Fund may
purchase securities on a "when-issued" basis, that is, delivery of and
payment for the securities is not fixed at the date of purchase, but is set
after the securities are issued (often a month or more later). Each Fund
also may purchase or sell securities on a delayed delivery basis. The payment
obligation and interest rate that will be received on the delayed delivery
securities are fixed at the time the buyer enters into the commitment. A
Fund will only make commitments to purchase when-issued or delayed delivery
securities with the intention of actually acquiring those securities, but
the Fund may sell these securities before the settlement date if is deemed
advisable. During the period between purchase and settlement, no payment is
made by the Fund and no interest accrues to the Fund. At the time of
settlement, the market value of the security may be more or less than the
purchase price, and Fund bears the risk of market value fluctuations. Each
Fund maintains, in a segregated account, cash, U.S. Government securities,
or other high-grade portfolio securities readily convertible into cash
having an aggregate value at least equal to the amount of purchase
commitments.
Repurchase Agreements: Each Fund may invest in repurchase agreement. In a
repurchase agreement, the Fund purchases a security and simultaneously
commits to resell that security to the seller at an agreed upon price on
an agreed upon date within a number of days (usually not more than seven)
from the date of purchase. The resale price reflects the purchase price
plus an agreed upon incremental amount which is unrelated to the coupon rate
or maturity of the purchased security. A repurchase agreement involves the
obligation of the seller to pay the agreed upon price, which obligation is,
in effect, secured by the value (at least equal to the amount of the agreed
upon resale price and marked to market daily) of the underlying security.
The Fund may engage in a repurchase agreement with respect to any security
in which it is authorized to invest. Any repurchase transaction in which
the Fund engages will require collateralization equal to at least 102% of
the Seller's obligation during the entire term of the repurchase agreement.
While it does not presently appear possible to eliminate all risks from these
transactions (particularly the possibility of a decline in the market value
of the underlying securities, as well as delays and costs to the Fund in
connection with bankruptcy proceedings), it is the Fund's current policy to
limit repurchase agreement transactions to those parties whose
creditworthiness has been reviewed and deemed satisfactory by the Advisor.
Illiquid and Rule 144A Securities: Each Fund may invest up to 15% of its
net assets in securities that are illiquid. Illiquid securities include
securities that have no readily available market quotations and cannot be
disposed of promptly (within seven days) in the normal course of business
at a price at which they are valued. Certain restricted securities that are
not registered for sale to the general public, but that can be resold to
dealers or institutional investors ("Rule 144A Securities"), may be
purchased without regard to the foregoing limitation if a liquid
institutional trading market exists. The liquidity of a Fund's investments
in Rule 144A Securities could be impaired if dealers or institutional
investors become uninterested in purchasing these securities. The Trust's
Board of Trustees has delegated to the Advisor, the authority to determine
the liquidity of Rule 144A Securities pursuant to guidelines approved by the
Board.
Loans of Portfolio Securities: Each Fund may make short and long term loans
of its portfolio securities. Under the lending policy authorized by the Board
of Trustees and implemented by the Advisor in response to requests of broker-
dealers or institutional investors which the Advisor deems qualified, the
borrower must agree to maintain collateral, in the form of cash or U.S.
government obligations, with the Fund on a daily mark-to-market basis in an
amount at least equal to 100% of the value of the loaned securities. The
Fund will continue to receive dividends or interest on the loaned securities
and will require that proxies and other materials be provided in time to vote
on any matter which the Board of Trustees determines to be serious. With
respect to loans of securities, there is the risk that the borrower may fail
to return the loaned securities or that the borrower may not be able to
provide additional collateral. A Fund will not lend securities with an
aggregate market value of more than one-third of the Fund's net assets.
Restricted Securities: Restricted securities generally can be sold in
privately negotiated transactions, pursuant to an exemption from
registration under the Securities Act of 1933, or in a registered public
offering. Where the registration is required, a Fund holding restricted
securities may be obligated to pay all or part of the registration expense
and a considerable period may elapse between the time it decides to seek
registration and the time the Fund may be permitted to sell a security
under an effective registration statement.
If, during such a period, adverse market conditions were to develop, the
Fund might obtain a less favorable price than prevailed when it decided to seek
registration of the security.
TEMPORARY DEFENSIVE POSITION
In seeking its primary investment objective of capital appreciation, a Fund
may expect that it generally will hold investments for at least six months.
However, if the Advisor concludes that economic, market, or industry
conditions warrant major adjustments in any Fund's investment positions or
if unusual market conditions or developments dictate the taking of a
temporary defensive position in short-term money market instruments, changes
may be made without regard to the length of time an investment has been held,
or whether a sale results in profit or loss, or a purchase results in the
reacquisition of an investment which may have only recently been sold by the
Fund.
PORTFOLIO TURNOVER
The Advisor buys and sells securities for the Funds to accomplish its
investment objectives. The Funds' investment policies may lead to frequent
changes in investments, particularly in periods of rapidly fluctuating
interest rates.
The Funds' investments may also be traded to take advantage of perceived short-
term disparities in market values or yields among securities of comparable
quality and maturity. A change in the securities held by a Fund is known as
"portfolio turnover." It is anticipated that portfolio turnover for each fund
will generally not exceed 100%. However, the Funds are to be used by other
investment advisers allocating client assets between various sectors or
countries. If those advisers move client assets in and out of a Fund, that
Fund's portfolio turnover rate could be significantly greater. Portfolio
turnover rates for prior
fiscal periods are set forth in the "Financial Highlights" portion of the
prospectus.
TRUSTEES AND OFFICERS
The Funds are supervised by a board of Trustees who are responsible for
major decisions about the Funds' policies and overall Fund oversight. The
names of the Trustees and executive officers of the Trust are shown below.
Each Trustee who is an "interested person" of the Trust, as defined in the
Investment Company Act of 1940, is indicated by an asterisk.
Name, Age and Address Position Principal Occupation During Past 5 Years
Craig T. Callahan * Age: 48 52 Glenmoor Way Englewood, CO 80110 President
and Trustee (Since Inception) President of Meridian Management & Research
Corporation, President and Chief Investment Officer of the Advisor, and
President of Meridian Clearing Corporation, the principal underwriter for
the Funds.
R. Michael Sentel Age: 51 15663 Wedge Way Morrison, CO 80465 Trustee,
Audit Committee Member (Since Inception) Attorney for U.S. Department of
Education since October 1996; owner of Sentel & Company from 1994 to present;
Counsel (Section Chief) of Professional Liability Section of FDIC's Litigation
Division from 1991 to 1994.
James W. Hire Age: 51 1383 Solitude Lane Evergreen, CO 80439 Trustee,
Audit Committee Member (Since Inception) Principal of Hire & Associates since
1988.
Glen F. Bergert Age: 49 1010 Brentwater Road Camp Hill, PA 17011 Trustee,
Audit Committee Member (Since February 1999) President, Venture Capital
Management LLC since 1997; Partner, KPMG Peat Marwick, LLP from 1979 to 1997.
Erik L. Jonson, CPA Age: 50 9465 West Geddes Place Littleton, CO 80112
Vice President and Chief Financial Officer, Chief Accounting Officer
Chief Financial Officer and Secretary of Meridian Management & Research
Corporation, owner of Erik L. Jonson, CPA from 1986 to 1996.
Deborah Zele Urtz Age: 35 5928 E. Weaver Circle Englewood, CO 80111
Chief Compliance Officer Chief Compliance Officer of the Advisor, Financial
and Operations Principal of Meridian Clearing Corporation, the principal
underwriter of the Funds; 14 years experience in securities industry in
operations and compliance.
Robin B. Shipman Age: 43 3952 S. Carson St., Unit 206 Aurora, CO. 80014
Vice President and Secretary (Since February 1999) Since December 1, 1999:
General Counsel and Assistant Secretary to Meridian Management &
Research Corporation; General Counsel, Vice-President and Assistant Secretary
to the Advisor; General Counsel to Meridian Clearing Corporation; Senior
Enforcement Attorney, U.S. Securities and Exchange Commission from December
1988 through November 1998.
The compensation paid to the Trustees of the Trust during the fiscal year
ended September 30, 1999, is set forth in the following table. Trustee fees are
Trust expenses and each fund of the Trust pays a portion of the Trustee fees.
Name
Aggregate Compensation from Trust
Pension or Retirement Accrued As Part of Fund Expenses
Estimated Annual Benefits Upon Retirement
Total Compensation from Trust (the Trust is not in a Fund Complex)
Craig T. Callahan $0 $0 $0 $0
R. Michael Sentel $8,000 $0 $0 $8,000
James W. Hire $8,000 $0 $0 $8,000
Glen F. Bergert $6,000 $0 $0 $6,000
TOTAL $16,000 $0 $0 $16,000
PRINCIPAL SHAREHOLDERS
As of August 30, 1999, no person owned, beneficially or of record, more
than 5% of the outstanding shares of any of the Funds except:
Fund Amount owned
- -------------------------------------------------------------------
Charles Schwab & Co., Inc., ICON Energy Fund 12.10%
101 Montgomery Street ICON Financial Services Fund 7.36%
San Francisco, CA 94104 ICON Technology Fund 16.02%
(record owner) ICON Telecommunication &
Utilities Fund 6.36%
ICON Asia Region Fund 26.53%
ICON North Europe Region Fund 8.11%
National Financial Services Corp.ICON Energy Fund 8.09%
P.O. Box 3908
Church Street Station
New York, NY 10008
(record owner)
Resources Trust Corporation
P.O. Box 5900 ICON Basic Materials Fund 94.28%
Denver, Colorado 80217 ICON Consumer Cyclicals Fund 94.86%
(record owner) ICON Energy Fund 73.33%
ICON Financial Services Fund 90.24%
ICON Healthcare Fund 94.28%
ICON Leisure Fund 94.00%
ICON Technology Fund 80.55%
ICON Telecommunication &
Utilities Fund 91.25%
ICON Transportation Fund 94.38%
ICON Asia Region Fund 67.69%
ICON North Europe Region Fund 83.97%
ICON South Europe Region Fund 90.98%
ICON Short-Term Fixed
Income Fund 70.88%
These broker-dealers and/or trust company custodians hold the shares for the
benefit of their customers. The Trust is not aware of any person who
beneficially owns more than 5% of the outstanding shares of any of the
Funds. As of August 30, 1999, the officers and Trustees of the Trust, as a
group, owned less than 1% of the outstanding shares of any Fund.
THE INVESTMENT ADVISOR
The Trust retains Meridian Investment Management Corporation, 12835 East
Arapahoe Road, Tower II, Englewood, Colorado 80112 (the "Advisor") to manage
each Fund's investments. Meridian is a wholly-owned subsidiary of Meridian
Management & Research Corporation ("MM&R"). Prior to January 2, 1999,
Michael J. Hart and Dr. Craig T. Callahan each owned 50% of MM&R. Beginning
January 2, 1999, Dr. Callahan became the sole owner of MM&R. He may be
deemed to control the Advisor due to his ownership of MM&R shares and his
position as an officer and director of the Advisor.
As shown in the table above, Mr. Jonson, Ms. Urtz and Ms. Shipman hold
positions with both the Advisor, its affiliates, and the Funds, but have no
ownership positions with the Adviser or its affiliates.
Under the terms of the Advisory Agreement, the Advisor manages the Funds'
investments subject to approval of the Board of Trustees. As compensation
for its management services, a Fund is obligated to pay the Advisor a fee
computed and accrued daily and paid monthly at an annual rate of 1.00% for
the ICON U.S. Equity Funds of the average daily net assets; 1.00% for the
ICON Foreign Equity Funds; 0.65% for the ICON Fixed Income Fund. The Advisor
may waive all or part of its fee, at any time, and at its sole discretion,
but such action shall not obligate the Advisor to waive any fees in the
future. The Fund is responsible for the payment of all expenses incurred in
connection with the organization and initial registration of shares of a
Fund. Below is a table which shows the advisory fees paid from inception.
The Board of Trustees voted (including a majority of the "disinterested
Trustees") and shareholder approval was given for the Advisory Agreement
through October 1998. The Agreement provides that it will continue initially
for two years, and from year to year thereafter, with respect to each Fund,
as long as it is approved at least annually (i) by a vote of a majority of the
outstanding voting securities of such Fund (as defined in the 1940 Act) or
(ii) by the Board of Trustees of the Trust, and/or by a vote of a majority of
the Trustees who are not parties to the Advisory Agreement or "interested
persons" of any party thereto, cast in person at a meeting called for the
purpose of voting on such approval. As of the date of this SAI, the Advisory
Agreement has been continued through October 2000. The Advisory Agreement may
be terminated on 60 days' written notice by either party and will terminate
automatically if assigned.
Advisory Fee Paid to Meridian-Inception through 9-30-97 $ 2,237,124
Advisory Fee Paid to Meridian 10-1-97 through 9-30-98 $ 5,001,160
Advisory Fee Paid to Meridian 10-1-98 through 9-30-99 (to be added) $
The Advisor retains the right to use the name "ICON" in connection with
another investment company or business enterprise with which the Advisor is
or may become associated. The Trust's right to use the name "ICON"
automatically ceases ninety days after termination of the Agreement and may
be withdrawn by the Advisor on ninety days written notice.
The Advisor may make payments to banks or other financial institutions that
provide shareholder services and administer shareholder accounts. The Glass-
Steagall Act prohibits banks from engaging in the business of underwriting,
selling or distributing securities. Although the scope of this prohibition
under the Glass-Steagall Act has not been clearly defined by the courts or
appropriate regulatory agencies, management of a Fund believes that the
Glass-Steagall Act should not preclude a bank from providing such services.
However, state securities laws on this issue may differ from the
interpretations of federal law expressed herein and banks and financial
institutions may be required to register as dealers pursuant to state law. If
a bank were prohibited from continuing to perform all or a part of such
services, management of the Funds believes that there would be no material
impact on the Funds or its shareholders. Banks may charge their customers
fees for offering these services to the extent permitted by applicable
regulatory authorities, and the overall return to those shareholders availing
themselves of the bank services will be lower than to those shareholders who
do not. The Fund may from time to time purchase securities issued by banks
which provide such services; however, in selecting investments for the Funds,
no preference will be shown for such securities.
ADMINISTRATIVE SERVICES
Under a separate written agreement, Meridian as ("Administrator") provides
day-to-day administrative services to the Trust. The Administrator provides
the Trust with office space, facilities and simple business equipment, and
generally administers the Trust's business affairs and provides the services of
executive and clerical personnel for administering the affairs of the Trust.
Meridian compensates all personnel, officers and Trustees of the Trust if such
persons are employees of the Administrator or its affiliates. From October
1996 until April 1, 1998, the Funds had retained an administrator other than
Meridian. In April 1998, the Funds entered into a Co-Administration Agreement
with Meridian and the prior administrator. As of March 1, 1999, the Funds
have retained Meridian as the Administrator. Below is a table which shows the
administration fees paid from inception.
Administrative Fee paid to prior administrator-Inception through 9-30-97
$125,701
Administrative Fee paid to prior administrator 10-1-97 through 9-30-98
$182,127
Administrative Fee paid to Meridian 10-1-97 through 9-30-98 $ 66,546
Administrative Fee paid to Meridian 10-1-98 through 9-30-99 (to be added)
$
CUSTODIAN
Firstar Bank Milwaukee, Post Office Box 701, Milwaukee, Wisconsin 53201, is
Custodian of the Funds' investments. The Custodian acts as the Funds'
depository, safekeeps its portfolio securities, collects all income and
other payments with respect thereto, disburses funds at the Funds' request and
maintains records in connection with its duties.
TRANSFER AGENT
Firstar Mutual Fund Services, LLC, Post Office Box 701, Milwaukee, Wisconsin
53201, acts as the Funds' transfer agent and, in such capacity, maintains
the records of each shareholder's account, answers shareholders' inquiries
concerning their accounts, processes purchases and redemptions of the Funds'
shares, acts as dividend and distribution disbursing agent and performs
other accounting and shareholder service functions.
INDEPENDENT ACCOUNTANTS AND COUNSEL
PricewaterhouseCoopers LLP, 950 Seventeenth Street, Suite 2500, Denver,
Colorado 80202, has been selected as independent accountants for the Trust
for the fiscal year ending September 30, 1999. Charles W. Lutter, Jr., 103
Canyon Oaks, San Antonio, Texas 78232, is legal counsel to the Trust.
DISTRIBUTOR
Meridian Clearing Corporation, 12835 E. Arapahoe Road, Tower II, Englewood,
Colorado 80112, an affiliate of the Advisor, is the exclusive agent for
distribution of shares of the Funds. The Distributor is obligated to sell
the shares of the Funds on a best efforts basis only against purchase orders
for the shares. Shares of the Funds are offered on a continuous basis.
PORTFOLIO TRANSACTIONS - BROKERAGE ALLOCATION
The Advisory Agreement between the Trust and the Advisor requires that the
Advisor, in executing portfolio transactions and selecting brokers or
dealers, seek the best overall terms available. In assessing the terms of a
transaction, consideration may be given to various factors, including the
breadth of the market in the security, the price of the security, the
financial condition and execution capability of the broker or dealer (for a
specified transaction and on a continuing basis), the reasonableness of the
commission, if any, and the brokerage and research services provided to the
Trust and/or other accounts over which the Advisor or an affiliate of the
Advisor exercises investment discretion. Under the Advisory Agreement, the
Advisor is permitted, in certain circumstances, to pay a higher commission
than might otherwise be obtained in order to acquire brokerage and research
services. The Advisor must determine in good faith, however, that such
commission is reasonable in relation to the value of the brokerage and
research services provided -- viewed in terms of that particular transaction
or in terms of all the accounts over which investment discretion is
exercised. In such case, the Board of Trustees will review the
commissions paid by each Fund of the Trust to determine if the commissions
paid over representative periods of time were reasonable in relation to the
benefits obtained. The advisory fee of the Advisor would not be reduced by
reason of its receipt of such brokerage and research services. To the extent
that research services of value are provided by broker/dealers through or
with whom the Trust places portfolio transactions the Advisor may be relieved
of expenses which it might otherwise bear.
The Trust may, in some instances, purchase securities that are not listed on
a national securities exchange or quoted on NASDAQ, but rather are traded in
the over-the-counter market. When the transactions are executed in the over-the-
counter market, it is intended generally to seek first to deal with the
primary market makers. However, the services of brokers will be utilized if
it is anticipated that the best overall terms can thereby be obtained.
Purchases of newly issued securities usually are placed with those dealers
from which it appears that the best price or execution will be obtained.
Those dealers may be acting as either agents or principals.
The Funds purchase portfolio securities from broker-dealers in both
principal and agency transactions. When a dealer sells a security on a
principal basis it is compensated by the "markup" it includes in the price
of the security.
Listed securities are generally traded on an agency basis and the broker
receives a
commission for acting as agent. The aggregate dollar amount of brokerage
fees paid by the Funds for the most recent fiscal years are as follows:
1999 1998 1997
ICON Basic Materials (to be added) $238,749 $224,797
ICON Capital Goods 0 0
ICON Consumer Cyclicals 138,972 20,267
ICON Consumer Staples 0 0
ICON Energy 69,414 0
ICON Financial Services 50,068 22,998
ICON Healthcare 121,805 211,695
ICON Leisure 98,876 88,637
ICON Technology 105,308 57,749
ICON Telecommunications & Utilities 121,874 16,438
ICON Transportation 14,011 29,534
ICON Asia Region 104,289 92,427
ICON North Europe 100,757 104,419
ICON South Europe 129,283 40,549
ICON South Pacific 0 0
ICON Western Hemisphere 0 0
PURCHASE AND REDEMPTION OF SHARES
There is no sales charge on the purchase of Fund shares. Shares may be
purchased by contacting the Transfer Agent at 1-800-764-0442 or simply
complete the application form enclosed with the Prospectus. Shares of
any Funds may be purchased at the net asset value per share next
determined after receipt of the purchase order. Investors may invest any
amount as often as they wish; however, the minimum investment in any
one Fund is $1,000. Subject to the minimum investment amount, shares
may also be purchased by exchange.
The Funds have authorized one or more brokers to accept purchase orders on
the Fund's behalf. Such brokers are authorized to designate other
intermediaries to accept purchase orders on the Funds' behalf. The Funds
will be deemed to have received a purchase order when an authorized
broker or, if applicable, a broker's authorized designee, accepts the order.
A purchase order will be priced at the Fund's Net Asset Value next calculated
after the order has been accepted by an authorized broker or the broker's
authorized designee.
The Funds have also authorized one or more brokers to accept redemption
orders on the Funds' behalf. Such brokers are authorized to designate
other intermediaries to accept redemption orders on the Fund's behalf. The
Fund will be deemed to have received a redemption order when an authorized
broker or, if applicable, a broker's authorized designee, accepts the order. A
redemption order will be priced at the Fund's Net Asset Value next
calculated after the order has been accepted by an authorized broker or
the broker's authorized designee.
It is possible that in the future conditions may exist which would, in the
opinion of the Funds' Advisor, make it undesirable for the Fund to pay for
redeemed shares in cash. In such cases, the Advisor may authorize payment
to be made in portfolio securities or other property of the Fund. However,
the Company is obligated under the 1940 Act to redeem for cash all shares of
the Fund presented for redemption by any one shareholder having a value up to
$250,000 (or 1% of the Fund's net assets if that is less) in any 90-day
period. Securities delivered in payment of redemptions are selected
entirely by the Advisor based on what is in the best interests of the Fund
and its shareholders, and are valued at the value assigned to them in
computing the Fund's net asset value per share. Shareholders receiving
such securities are likely to incur brokerage costs on their subsequent
sales of the securities.
Other procedures for purchasing, selling (redeeming) and exchanging Fund
shares are described in the Prospectus.
DETERMINATION OF SHARE OFFERING PRICE
The price (net asset value) of the shares of a Fund is determined as of 4:00
p.m., Eastern time on each day the Funds are open for business and on any
other day on which there is sufficient trading in the Funds' securities to
materially affect the net asset value. In the event markets close early
(such as on the eve of a holiday), net asset value per share will be
determined as of such earlier time. The Funds are open for business on
every day except Saturdays,Sundays and the following holidays: New Year's
Day, Martin Luther King Jr. Day, President's Day, Good Friday, Memorial Day,
Independence Day, Labor Day,Thanksgiving and Christmas. For a description of
the methods used to determine the net asset value (share price), see "Pricing
Shares and Receiving Sales Proceeds" in the Prospectus.
TAX STATUS
Taxation of the Funds -- in General
As stated in its prospectus, each Fund intends to qualify as a "regulated
investment company" under Subchapter M of the Internal Revenue Code of 1986,
as amended (the "Code"). Accordingly, each Fund will not be liable for federal
income taxes on its taxable net investment income and capital gain net
income that are distributed to shareholders, provided that the Fund
distributes at least 90% of its net investment income and net short-term
capital gain for the taxable year.
To qualify as a regulated investment company, each Fund must, among other
things, (a) derive in each taxable year at least 90% of its gross income
from dividends, interest, payments with respect to securities loans, gains from
the sale or other disposition of stock, securities or foreign currencies, or
other income derived with respect to its business of investing in such stock,
securities or currencies (the "90% test"); (b) satisfy certain
diversification requirements at the close of each quarter of the Fund's
taxable year.
The Code imposes a non-deductible 4% excise tax on a regulated investment
company that fails to distribute during each calendar year an amount equal
to the sum of (1) at least 98% of its ordinary income for the calendar year,
(2) at least 98% of its net capital gains for the twelve-month period ending on
October 31 and (3) any portion (not taxable to the Fund) of the respective
balance from the preceding calendar year. The Funds intend to make such
distributions as are necessary to avoid imposition of this excise tax.
Taxation of the Funds' Investments
The Fund's ability to make certain investments may be limited by provisions
of the Code that require inclusion of certain unrealized gains or losses in the
Fund's income for purposes of the 90% test, and the distribution
requirements of the Code, and by provisions of the Code that characterize
certain income or loss as ordinary income or loss rather than capital gain
or loss. Such recognition, characterization and time rules generally apply
to investments in certain forward currency contracts, foreign currencies and
debt securities denominated in foreign currencies.
Taxation of the Shareholder
Taxable distributions generally are included in a shareholder's gross income
for the taxable year in which they are received. However, dividends declared in
October, November or December and made payable to shareholders of record in
such a month will be deemed to have been received on December 31, if a Fund pays
the dividends during the following January. To the extent that a Fund's net
investment income does not arise from dividends on domestic common or preferred
stock, the Funds' distributions will not qualify for the 70% corporate
dividends-received deduction.
Distributions by a Fund will result in a reduction in the fair market value
of the Fund's shares. Should a distribution reduce the fair market value below
a shareholder's cost basis, such distribution nevertheless would be taxable to
the shareholder as ordinary income or long-term capital gain, even though, from
an investment standpoint, it may constitute a partial return of capital. In
particular, investors should be careful to consider the tax implications of
buying shares of a Fund just prior to a distribution. The price of such
shares purchased at that time includes the amount of any forthcoming
distribution. Those investors purchasing the Fund's shares just prior to a
distribution may receive a return of investment upon distribution which will
nevertheless be taxable to them.
A shareholder of a Fund should be aware that a redemption of shares
(including any exchange into another Portfolio) is a taxable event and,
accordingly, a capital gain or loss may be recognized. If a shareholder of a
Fund receives a distribution taxable as long-term capital gain with respect
to shares of the Fund and redeems or exchanges shares before he has held
them for more than six months, any loss on the redemption or exchange
(not otherwise disallowed as attributable to an exempt-interest dividend)
will be treated as long-term capital loss to the extent of the long term
capital gain recognized.
OTHER TAX CONSIDERATIONS
Distributions to shareholders may be subject to additional state, local and
non-U.S. taxes, depending on each shareholder's particular tax situation.
Shareholders subject to tax in certain states may be exempt from state
income tax on distributions made by a Fund to the extent such distributions are
derived from interest on direct obligations of the United States Government.
Shareholders are advised to consult their own tax advisers with respect to
the particular tax consequences to them of an investment in shares of a Fund.
There is a possibility that a foreign country (e.g. China with exchange
control regulations) may restrict or limit the ability of the Fund to
distribute net investment income or the proceeds from the sale of its
investments to its shareholders. Those kind of restrictions or limitations
could impact the Fund's ability to meet the distribution requirements
described above.
If the Fund owns shares in a foreign corporation that constitutes a "passive
foreign investment company" for U.S. Federal income tax purposes, and the
Fund does not elect to treat the foreign corporation as a "qualified electing
fund" within the meaning of the Code, the Fund may be subject to U.S. Federal
income tax on a portion of any "excess distribution" it receives from the
foreign corporation or any gain it derives from the disposition of those
shares, even if that income is distributed as a taxable dividend by the Fund
to its U.S. shareholders. The Fund may also be subject to additional tax in
the nature of an interest charge with respect to deferred taxes arising from
those distributions or gains. Any tax paid by the Fund as a result of its
ownership of shares in a "passive foreign investment company" will not give
rise to any deduction or credit to the Fund or any shareholder. If the Fund
owns shares in a "passive foreign investment company" and the Fund does
elect to treat the foreign corporation as a "qualified electing fund" under
the Code, the Fund may be required to include in its income each year a
portion of the ordinary income and net capital gains of the foreign
corporation, even if this income is not distributed to the Fund. This type
of income would be subject to the distribution requirements described above
even if the Fund did not receive any income to distribute.
Currency Fluctuations - "Section 988" Gains or Losses
Under the IRS Code, gains or losses attributable to fluctuations in exchange
rates which occur between the time the Fund accrues interest or other
receivables, or accrues expenses or other liabilities denominated in a
foreign currency, and the time the Fund actually collects those receivables
or pays those liabilities, are treated as ordinary income or ordinary loss.
Similarly, gains or losses from the disposition of foreign currencies or
from the disposition of debt securities denominated in a foreign currency
attributable to fluctuations in the value of the foreign currency between
the date of acquisition of the currency or security and the date of
disposition also are treated as ordinary gain or loss. These gains or losses,
referred to under the Code as "section 988" gains or losses, increase or
decrease the amount of the Fund's net investment income (which includes,
among other things, dividends, interest and net short-term capital gains in
excess of net long-term capital losses, net of expenses) available to be
distributed to its shareholders as ordinary income, rather than increasing
or decreasing the amount of the Fund's net capital gain. If section 988
losses exceed other net investment income during a taxable year, any
distributions made by the Fund could be re-characterized as a return of
capital to shareholders, rather than as an ordinary dividend, reducing each
shareholder's basis in his Fund shares. To the extent that those
distributions exceed those shareholder's basis, they will be treated
as a gain from the sale of shares. As discussed below, certain gains or
losses with respect to forward foreign currency contracts, over-the-counter
options or foreign currencies and certain options graded on foreign
exchanges will also be treated as section 988 gains or losses.
Forward currency contracts and certain options entered into by the Fund may
create "straddles" for U.S. Federal income tax purposes and this may affect
the character of gains or losses realized by the Fund on forward currency
contracts or on the underlying securities and cause losses to be deferred.
Transactions in forward currency contracts may also result in the loss of
the holding period of underlying securities. The Fund may also be required
to "mark-to-market" certain positions in its portfolio (i.e., treat them as
if they were sold at year end). This could cause the Fund to recognize
income without having the cash to meet the distribution requirements.
Foreign Taxes
Income received by the Fund from sources within other countries in which the
issuers of securities purchased by the Fund are located, may be ription of
the foreign tax credit under current law. Because applicability of the credit
depends on the particular circumstances of each shareholder, shareholders
are advised to consult their own tax advisers.
CALCULATION OF PERFORMANCE DATA
UNDERSTANDING PERFORMANCE INFORMATION
This section should help you understand the terms used to describe fund
performance. You will come across them in shareholder reports,
advertisements, promotional materials, and the media. Each of the Funds may
compare its performance to that of other mutual funds with similar investment
objectives and to stock or other indices. Past performance is not
representative of future performance.
Total Return tells you how much an investment in a Fund has changed in value
over a given time period. It reflects any net increase or decrease in the
share price, and assumes that all dividends and capital gains (if any) paid
during the period were re-invested in additional shares.
Cumulative Total Return is the actual return of an investment for a specific
time period. A cumulative return does not reflect how much the value of the
investment may have fluctuated during the period.
Average Annual Return is hypothetical and should not be confused with actual
yearly results. An average annual total return reflects the hypothetical
annually compounded return that would have produced the same total return if
the Fund's performance had been constant over the entire period.
Total Return
A Fund may advertise performance in terms of average annual total return for
1, 5 and 10 year periods, or for such lesser periods as the Fund has been in
existence. Average annual total return is computed by finding the average
annual compounded rates of return over the periods that would equate the
initial amount invested to the ending redeemable value according to the
following formula:
n
P(1+T) = ERV
Where: P = a hypothetical $1,000 initial investment
T = average annual total return
n = number of years
ERV= ending redeemable value at the end of the
applicable period of the hypothetical
$1,000 investment made at the beginning of
the applicable period.
The calculation assumes all charges are deducted from the initial $1,000
payment and assumes all dividends and distributions by the Fund are
reinvested at the price stated in the prospectus on the reinvestment dates
during the period, and includes all recurring fees that are charged to all
shareholder accounts.
Pursuant to Item 21 of Form N-1A the Trust is providing average annual Total
Returns for the active funds for the years ended September 30, 1998 and
1999(to be added). The ICON Energy Fund commenced operations on
November 5, 1997 and the annualized numbers are based on periods of less
than one year and should not be construed to mean the funds actual annual
results will be the same.
Fund 1998 Average Annual Total Return 1999 Average Annual Total Return
ICON Basic Materials Fund (37.45%)
ICON Consumer Cyclicals Fund (28.26%)
ICON Energy Fund (36.50%)
ICON Financial Services Fund (10.46%)
ICON Healthcare Fund 3.77%
ICON Leisure Fund 4.18%
ICON Technology Fund (26.1 %)
ICON Telecommunication &
Utilities Fund 33.88%
ICON Transportation Fund (22.08%)
ICON Asia Region Fund (38.73%)
ICON North Europe Region Fund 7.00%
ICON South Europe Region Fund 6.11%
ICON Short-Term Fixed
Income Fund 6.55%
A Fund's investment performance will vary depending upon market conditions,
the composition of the Fund's portfolio and operating expenses of the Fund.
These factors and possible differences in the methods and time periods used in
calculating non-standardized investment performance should be considered
when comparing the Fund's performance to those of other investment companies or
investment vehicles. The risks associated with the Fund's investment
objective, policies and techniques should also be considered. At any time in
the future, investment performance may be higher or lower than past
performance, and there can be no assurance that any performance will continue.
Yield
A Fund may also advertise performance in terms of a 30 day yield quotation.
The 30 day yield quotation is computed by dividing the net investment income
per share earned during the period by the maximum offering price per share on
the last day of the period according to the following formula:
YIELD = 2 [ (A - B + 1)6 - 1]
----------
CD
Where: A = dividends and interest earned during the
period
B = expenses accrued for the period
(net of reimbursement)
C = the average daily number of shares
outstanding during the period that were
entitled to receive dividends
D = the maximum offering price per share on the
last day of the period
The yield for the 30-day period ending September 30, 1999 for the Short-Term
Fixed-Income Fund was (to be added).
Non-standardized Total Return
A Fund may provide the above described standard total return results for a
period which ends as of not earlier than the most recent calendar quarter
end and which begins either twelve months before or at the time of commencement
of the Fund's operations. In addition, the Fund may provide non-standardized
total return results for differing periods, such as for the most recent six
months. Such non-standardized total return is computed as otherwise
described under "Total Return" except that no annualization is made.
ADDITIONAL INFORMATION REGARDING THE FUNDS
The assets received by the Trust from the issue or sale of shares of each of
the Funds, and all income, earnings, profits and proceeds thereof, subject only
to the rights of creditors, are separately allocated to such Fund. They
constitute the underlying assets of each Fund, are required to be segregated
on the books of accounts, and are to be charged with the expenses with
respect to such Fund. Any general expenses of the Trust, not readily
identifiable as belonging to a particular Fund, shall be allocated by or
under the direction of the Board of Trustees in such manner as the Board
determines to be fair and equitable.
Each share of each of the Funds represents an equal proportionate interest in
that Fund with each other share and is entitled to such dividends and
distributions, out of the income belonging to that Fund, as are declared by
the Board. Upon liquidation of the Trust, shareholders of each Fund are
entitled to share pro rata in the net assets belonging to the Fund available
for distribution.
The Trustees have exclusive power, without the requirement of shareholder
approval, to issue series of shares without par value, each series
representing interests in a separate portfolio, or divide the shares of any
portfolio into classes, each class having such different dividend,
liquidation, voting and other rights as the Trustees may determine, and may
establish and designate the specific classes of shares of each portfolio.
Before establishing a new class of shares in an existing portfolio, the
Trustees must determine that the establishment and designation of separate
classes would not adversely affect the rights of the holders of the initial
or previously established and designated class or classes.
As described under "the Trust" in the prospectus, under the Trust's Master
Trust Agreement, no annual or regular meeting of shareholders is required. In
addition, after the Trustees were initially elected by the shareholders, the
Trustees became a self-perpetuating body. Thus, there will ordinarily be no
shareholder meetings unless otherwise required by the Investment Company
Act of 1940.
On any matter submitted to shareholders, the holder of each share is
entitled to one vote per share (with proportionate voting for fractional
shares). On matters affecting any individual Fund, a separate vote of that
Fund would be required. Shareholders of any Fund are not entitled to vote on
any matter which does not affect their Fund but which requires a separate
vote of another Fund.
Shares do not have cumulative voting rights, which means that in situations
in which shareholders elect Trustees, holders of more than 50% of the shares
voting for the election of Trustees can elect 100% of the Trust's Trustees,
and the holders of less than 50% of the shares voting for the election of
Trustees will not be able to elect any person as a Trustee.
Shares have no preemptive or subscription rights and are fully transferable.
There are no conversion rights. Under Massachusetts law, the shareholders
of the Trust could, under certain circumstances, be held personally liable for
the obligations of the Trust. However, the Master Trust Agreement disclaims
shareholder liability for acts or obligations of the Trust and requires that
notice of such disclaimer be given in each agreement, obligation or
instrument entered into or executed by the Trust or the Trustees. The Master
Trust Agreement provides for indemnification out of the Trust's property for
all losses and expenses of any shareholder held personally liable for the
obligations of the Trust. Thus, the risk of a shareholder incurring
financial loss on account of shareholder liability is limited to
circumstances in which the Trust itself would be unable to meet its obligations.
The Funds and Meridian have adopted a strict code of ethics that limits
directors, officers, investment personnel and other Meridian employees
in investing in securities for their own accounts. The code of ethics complies
in all material respects with the Investment Company Act of 1940. The Code is
available upon request by calling 1-888-389-ICON or writing:
Meridian Investment Management Corporation
12835 East Arapahoe Road, Tower II
Englewood, Colorado 80112
FINANCIAL STATEMENTS
(1) The audited financial highlights with respect to the following
series of the ICON Funds for the year ended September 30, 1999 and for the
period from the commencement of operations through
September 30, 1997 and 1998, are found in Part A of this Registration
Statement.
SERIES COMMENCEMENT OF OPERATIONS
ICON Short-Term Fixed Income Fund February 7, 1997
ICON North Europe Region Fund February 18, 1997
ICON South Europe Region Fund February 20, 1997
ICON Healthcare Fund February 24, 1997
ICON Asia Region Fund February 25, 1997
ICON Technology Fund February 19, 1997
ICON Basic Materials Fund May 5, 1997
ICON Leisure Fund May 9, 1997
ICON Transportation Fund May 9, 1997
ICON Financial Services Fund July 1, 1997
ICON Consumer Cyclicals Fund July 9, 1997
ICON Telecommunication & Utilities Fund July 9, 1997
At September 30, 1999, the following funds had not yet commenced
operations:ICON Capital Goods Fund, ICON Consumer Staples Fund, ICON South
Pacific Region Fund, and ICON Western Hemisphere Fund.
The financial statements for the fiscal period ended September 30, 1999 (to
be added), are hereby incorporated by reference from the Annual Report to
Shareholders of that date which has been delivered with this Statement of
Additional Information, unless previously provided. In that case, the Trust
will promptly provide another copy, free of charge, upon request to:
Meridian Investment Management Corporation
12835 East Arapahoe Road, Tower II
Englewood, Colorado 80112
OR
call 1-888-389-ICON
- ----------------------------------------------------------------------------
PART C
OTHER INFORMATION
- ----------------------------------------------------------------------------
- -
- ---
ICON FUNDS
PART C. OTHER INFORMATION
ITEM 23. EXHIBITS
(a) (1) Master Trust Agreement dated September 19, 1996, is
incorporated by reference from Registrant's Initial Registration
Statement on Form N-1A filed with the Commission on October
28, 1996 (the "Initial Registration Statement").
(2) Amendment No. 1 to Master Trust Agreement dated October 24,
1996, is incorporated by reference from Registrant's
Initial Registration Statement.
(3) Amendment No. 2 to the Master Trust Agreement dated December
18, 1996, incorporated by reference from Pre-effective amendment
No. 1 to registrant's registration statement on Form N-1A filed
with the Commission on December 19, 1996 ("Pre-effective
Amendment").
(4) Amendment No. 3 to the Master Trust Agreement dated February
18, 1999, is filed herewith.
(b) By-Laws dated October 9, 1996, are incorporated by reference
from Registrant's Initial Registration Statement.
(c) Relevant parts, including Article V of the Master Trust
Agreement
dated September 19, 1996, is incorporated by reference
from
Registrant's Initial Registration Statement. Other
instruments
defining rights of security holders - Not applicable.
(d) Advisory Agreement between Registrant and Meridian
Investment
Management Corporation dated October 9, 1996, is
incorporated
by
reference from Registrant's Initial Registration Statement.
(e) Distribution Agreement among Registrant, Meridian
Investment
Management Corporation, and Meridian Clearing Corp dated
December
1, 1998 is filed herewith.
(f) Bonus or profit sharing contracts - Not applicable
(g) Custodian Agreement between Registrant and Firstar Trust
Company,
including Global Custody arrangement with Chase Manhattan
Bank
is
incorporated by reference from Registrant's Initial
Registration
Statement.
(h) (1) Administrative Services Agreement Between Registrant and
Meridian
Investment Management Corporation dated March 1, 1999, is
filed
herewith.
(2) Transfer Agent Agreement between Registrant and Firstar
Trust
Company dated October 9, 1996, is incorporated by reference
from
Registrant's Initial Registration Statement.
(3) Fund Accounting Servicing Agreement between Registrant and
Firstar
Trust Company dated October 9, 1996, is incorporated by
reference
from Registrant's Initial Registration Statement.
(i) (1) Opinion and Consent of Lynch, Brewer, Hoffman & Sands,
LLP,
Attorneys at Law, is incorporated by reference from
Registrant's
Initial Registration Statement.
(j) (1) Consent of PricewaterhouseCoopers LLP, is filed herewith.
(2) Power of Attorney for Trustees and Officers is filed
herewith.
(k) Omitted financial statements - Not applicable.
(l) Copy of Letter of Initial Stockholder is incorporated by
reference
to the Pre-effective Amendment.
(m,o) Rules 12b-1 and 18f-3 plans - Not applicable.
ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND
Information pertaining to persons controlled by or under common
control
with Registrant is incorporated by reference to the
Statement
of
Additional Information contained in Part B of this
Registration
Statement at the section entitled "Administrative Services",
"The
Investment Advisor" and "Distributor".
ITEM 25. INDEMNIFICATION
Under Article VI of the Registrant's Master Trust Agreement,
each
of
its Trustees and officers or person serving in such capacity
with
another entity at the request of the Registrant (a "Covered
Person")
shall be indemnified (from the assets of the Sub-Trust or Sub-
Trusts
in
question) against all liabilities, including, but not limited
to,
amounts paid in satisfaction of judgments, in compromises or as
fines
or penalties, and expenses, including reasonable legal and
accounting
fees, incurred by the Covered Person in connection with the
defense
or
disposition of any action, suit or other proceeding, whether
civil
or
criminal before any court or administrative or legislative
body,
in
which such Covered Person may be or may have been involved as a
party
or otherwise or with which such person may be or may have
been
threatened, while in office or thereafter, by reason of being or
having
been such a Trustee or officer, director or trustee, except
with
respect to any matter as to which it has been determined that
such
Covered Person (i) did not act in good faith in the reasonable
belief
that such Covered Person's action was in or not opposed to the
best
interests of the Trust or (ii) had acted with willful misfeasance,
bad
faith, gross negligence or reckless disregard of the duties
involved
in
the conduct of such Covered Person's office (either and both of
the
conduct described in (i) and (ii) being referred to hereafter
as
"Disabling Conduct"). A determination that the Covered Person is
not
entitled to indemnification may be made by (i) a final decision on
the
merits by a court or other body before whom the proceeding was
brought
that the person to be indemnified was not liable by reason of
Disabling
Conduct, (ii) dismissal of a court action or an
administrative
proceeding against a Covered Person for insufficiency of
evidence
of
Disabling Conduct, or (iii) a reasonable determination, based
upon a
review of the facts, that the indemnitee was not liable by
reason
of
Disabling Conduct by (a) a vote of the majority of a quorum of
Trustees
who are neither "interested persons" of the Trust as defined in
Section
1(a)(19) of the 1940 Act nor parties to the proceeding, or
(b)
as
independent legal counsel in a written opinion.
ITEM 26. BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT ADVISER
Registrant's investment adviser, administrator and distributor
is
incorporated by reference to the Prospectus and
SAI
contained in Part A and Part B of this Registration Statement at
the
sections entitled "Organization and Management of the Fund" in
the
Prospectus, and "The Investment Advisor", "Administrative
Services"
and "Distributor" in the SAI.
ITEM 27. PRINCIPAL UNDERWRITERS
Meridian Clearing Corp. is the Registrant's principal
underwriter.
It receives no commissions or other compensation as
underwriter.
It is not an underwriter for any other investment
company.
Craig T. Callahan, 12835 East Arapahoe Road, Tower II,
Englewood,
Colorado 80112, owns 100% of the firm. Dr. Callahan is a
trustee,
officer and President of the Funds, and owns 100% of the Advisor
and
is
its President.
ITEM 28. LOCATION OF ACCOUNTS AND RECORDS
Accounts, books and other documents required to be maintained
by
Section 31(a) of the Investment Company Act of 1940 and the
Rules
promulgated thereunder will be maintained by the Registrant at
12835
East Arapahoe, Tower II, Englewood, Colorado 80112 and/or by
the
Registrant's Custodian, transfer and shareholder service agent,
Firstar
Mutual Fund Services, LLC, 615 East Michigan Street,
Milwaukee,
Wisconsin 53202.
ITEM 29. MANAGEMENT SERVICES NOT DISCUSSED IN PARTS A OR B
None.
ITEM 30. UNDERTAKINGS
Not Applicable.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and
the
Investment Company Act of 1940, the Fund has duly caused this post-
effective
amendment to be signed on its behalf by the undersigned, thereunto
duly
authorized, in the City of Englewood, State of Colorado, on the 22
day
of September, 1999.
ICON Funds
By: /s/ Craig T.
Callahan
--------------------
- -
- -
President
Pursuant to the requirements of the Securities Act of 1933,
this
Registration Statement has been signed below by the following persons in
the
capacities and on the dates indicated.
/s/ Craig T. Callahan
- - - - ------------------------------- President and Trustee
CRAIG T. CALLAHAN
/s/ R. Michael Sentel*
- - - - ------------------------------- Trustee
R. MICHAEL SENTEL
/s/ James W. Hire*
- - - - ------------------------------- Trustee
JAMES W. HIRE
/s/ Glen F. Bergert*
- - - - ------------------------------- Trustee
/s/ Erik L. Jonson
- - - - ------------------------------- Vice President and
Chief Accounting Officer
ERIK L. JONSON Chief Financial Officer
* By: /s/Charles W. Lutter, Jr.
-------------------------
Charles W. Lutter, Jr.
Attorney-in-Fact
- -----------------------------------------------------------------------------
- ---
PART C
OTHER INFORMATION
- -----------------------------------------------------------------------------
- ---
ICON FUNDS
PART C. OTHER INFORMATION
ITEM 23. EXHIBITS
(a) (1) Master Trust Agreement dated September 19, 1996, is
incorporated by reference from Registrant's Initial
Registration
Statement on Form N-1A filed with the Commission on October
28,
1996 (the "Initial Registration Statement").
(2) Amendment No. 1 to Master Trust Agreement dated October 24,
1996,
is incorporated by reference from Registrant's
Initial
Registration Statement.
(3) Amendment No. 2 to the Master Trust Agreement dated December
18,
1996, incorporated by reference from Pre-effective amendment
No. 1
to registrant's registration statement on Form N-1A filed with
the
Commission on December 19, 1996 ("Pre-effective Amendment").
(4) Amendment No. 3 to the Master Trust Agreement dated February
18,
1999, is filed herewith.
(b) By-Laws dated October 9, 1996, are incorporated by reference
from
Registrant's Initial Registration Statement.
(c) Relevant parts, including Article V of the Master Trust
Agreement dated September 19, 1996, is incorporated by
reference from Registrant's Initial Registration Statement.
Other instruments
defining rights of security holders - Not applicable.
(d) Advisory Agreement between Registrant and Meridian
Investment
Management Corporation dated October 9, 1996, is incorporated
by
reference from Registrant's Initial Registration Statement.
(e) Distribution Agreement among Registrant, Meridian
Investment
Management Corporation, and Meridian Clearing Corp dated
December
1, 1998 is filed herewith.
(f) Bonus or profit sharing contracts - Not applicable
(g) Custodian Agreement between Registrant and Firstar Trust
Company,
including Global Custody arrangement with Chase Manhattan Bank
is
incorporated by reference from Registrant's Initial
Registration
Statement.
(h) (1) Administrative Services Agreement Between Registrant and
Meridian
Investment Management Corporation dated March 1, 1999, is
filed
herewith.
(2) Transfer Agent Agreement between Registrant and Firstar
Trust
Company dated October 9, 1996, is incorporated by reference
from
Registrant's Initial Registration Statement.
(3) Fund Accounting Servicing Agreement between Registrant and
Firstar
Trust Company dated October 9, 1996, is incorporated by
reference
from Registrant's Initial Registration Statement.
(i) (1) Opinion and Consent of Lynch, Brewer, Hoffman & Sands,
LLP,
Attorneys at Law, is incorporated by reference from
Registrant's
Initial Registration Statement.
(j) (1) Consent of PricewaterhouseCoopers LLP, is filed herewith.
(2) Power of Attorney for Trustees and Officers is filed
herewith.
(k) Omitted financial statements - Not applicable.
(l) Copy of Letter of Initial Stockholder is incorporated by
reference
to the Pre-effective Amendment.
(m,o) Rules 12b-1 and 18f-3 plans - Not applicable.
ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND
Information pertaining to persons controlled by or under common
control
with Registrant is incorporated by reference to the Statement
of
Additional Information contained in Part B of this
Registration
Statement at the section entitled "Administrative Services",
"The
Investment Advisor" and "Distributor".
ITEM 25. INDEMNIFICATION
Under Article VI of the Registrant's Master Trust Agreement, each
of
its Trustees and officers or person serving in such capacity
with
another entity at the request of the Registrant (a "Covered
Person")
shall be indemnified (from the assets of the Sub-Trust or Sub-Trusts
in
question) against all liabilities, including, but not limited
to,
amounts paid in satisfaction of judgments, in compromises or as
fines
or penalties, and expenses, including reasonable legal and
accounting
fees, incurred by the Covered Person in connection with the defense
or
disposition of any action, suit or other proceeding, whether civil
or
criminal before any court or administrative or legislative body,
in
which such Covered Person may be or may have been involved as a
party
or otherwise or with which such person may be or may have
been
threatened, while in office or thereafter, by reason of being or
having
been such a Trustee or officer, director or trustee, except
with
respect to any matter as to which it has been determined that
such
Covered Person (i) did not act in good faith in the reasonable
belief
that such Covered Person's action was in or not opposed to the
best
interests of the Trust or (ii) had acted with willful misfeasance,
bad
faith, gross negligence or reckless disregard of the duties involved
in
the conduct of such Covered Person's office (either and both of
the
conduct described in (i) and (ii) being referred to hereafter
as
"Disabling Conduct"). A determination that the Covered Person is
not
entitled to indemnification may be made by (i) a final decision on
the
merits by a court or other body before whom the proceeding was
brought
that the person to be indemnified was not liable by reason of
Disabling
Conduct, (ii) dismissal of a court action or an
administrative
proceeding against a Covered Person for insufficiency of evidence
of
Disabling Conduct, or (iii) a reasonable determination, based
upon a
review of the facts, that the indemnitee was not liable by reason
of
Disabling Conduct by (a) a vote of the majority of a quorum of
Trustees
who are neither "interested persons" of the Trust as defined in
Section
1(a)(19) of the 1940 Act nor parties to the proceeding, or (b)
as
independent legal counsel in a written opinion.
ITEM 26. BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT ADVISER
Registrant's investment adviser, administrator and distributor
is
incorporated by reference to the Prospectus and
SAI
contained in Part A and Part B of this Registration Statement at
the
sections entitled "Organization and Management of the Fund" in
the
Prospectus, and "The Investment Advisor", "Administrative
Services"
and "Distributor" in the SAI.
ITEM 27. PRINCIPAL UNDERWRITERS
Meridian Clearing Corp. is the Registrant's principal
underwriter.
It receives no commissions or other compensation as
underwriter.
It is not an underwriter for any other investment
company.
Craig T. Callahan, 12835 East Arapahoe Road, Tower II,
Englewood,
Colorado 80112, owns 100% of the firm. Dr. Callahan is a
trustee,
officer and President of the Funds, and owns 100% of the Advisor and
is
its President.
ITEM 28. LOCATION OF ACCOUNTS AND RECORDS
Accounts, books and other documents required to be maintained
by
Section 31(a) of the Investment Company Act of 1940 and the
Rules
promulgated thereunder will be maintained by the Registrant at
12835
East Arapahoe, Tower II, Englewood, Colorado 80112 and/or by
the
Registrant's Custodian, transfer and shareholder service agent,
Firstar
Mutual Fund Services, LLC, 615 East Michigan Street,
Milwaukee,
Wisconsin 53202.
ITEM 29. MANAGEMENT SERVICES NOT DISCUSSED IN PARTS A OR B
None.
ITEM 30. UNDERTAKINGS
Not Applicable.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and
the
Investment Company Act of 1940, the Fund has duly caused this post-
effective
amendment to be signed on its behalf by the undersigned, thereunto
duly
authorized, in the City of Englewood, State of Colorado, on the 22
day
of September, 1999.
ICON Funds
By: /s/ Craig T.
Callahan
---------------------
- -
President
Pursuant to the requirements of the Securities Act of 1933,
this
Registration Statement has been signed below by the following persons in
the
capacities and on the dates indicated.
/s/ Craig T. Callahan
- - - - ------------------------------- President and Trustee
CRAIG T. CALLAHAN
/s/ R. Michael Sentel*
- - - - ------------------------------- Trustee
R. MICHAEL SENTEL
/s/ James W. Hire*
- - - - ------------------------------- Trustee
JAMES W. HIRE
/s/ Glen F. Bergert*
- - - - ------------------------------- Trustee
/s/ Erik L. Jonson
- - - - ------------------------------- Vice President and
Chief Accounting Officer
ERIK L. JONSON Chief Financial Officer
* By: /s/Charles W. Lutter, Jr.
-------------------------
Charles W. Lutter, Jr.
Attorney-in-Fact
ICON FUNDS
AMENDMENT NO. 3 TO MASTER TRUST AGREEMENT
AMENDMENT No. 3 to the Master Trust Agreement
of ICON Funds, dated September 19, 1996, made at Englewood,
Colorado as of this February 9, 1999 by the Trustees
hereunder.
WITNESSETH
WHEREAS, Section 7.3 of the ICON Master Trust
Agreement dated September 19, 1996 (the "Agreement"), of
ICON Funds (the "Trust") provides that the Agreement
may be amended at any time, so long as such amendment
does not adversely affect the rights of any shareholder
with respect to which such amendment is or purports to be
applicable and so long as such amendment is not in
contravention of applicable law, including the Investment
Company Act of 1940, by an instrument in writing, signed by
an officer of the Trust pursuant to
a vote of a majority of the Trustees of the Trust;
NOW, THEREFORE,
The undersigned Trustees, pursuant to the
authorization described above, hereby amend the Agreement,
as heretofore in effect, as follows:
All references to 1793 Kingswood Drive, Suite 200,
Southlake, Texas 76092 shall be deleted and the following
shall be inserted in lieu thereof:
"12835 East Arapahoe Road, Tower II, Penthouse,
Englewood, CO 80112"
WITNESS WHEREOF, our hands and seals this 9th day of
February 1999.
--------------------------
Glen F. Bergert, Trustee
--------------------------
Craig T. Callahan, Trustee
--------------------------
James W. Hire, Trustee
---------------------
R. Michael Sentel, Trustee
STATE OF COLORADO )
) ss:
COUNTY OF ARAPAHOE )
Before me, a Notary Public in and for said county
and state, personally appeared the above named , who
acknowledged that he did
sign the foregoing instrument in the capacity indicated and
that the same is his free act and deed on this 9th day of
February, 1999.
/s/
--------------------------
Notary Public
My Commission Expires: 9-30-2002
- --------
ICON FUNDS
DISTRIBUTION AGREEMENT
THIS DISTRIBUTION AGREEMENT (the "Agreement"), dated as of December
1, 1998, is between the ICON Funds (the "Trust"), a Massachusetts business
trust, Meridian Investment Management Corporation (the "Adviser"), a Colorado
corporation, and Meridian Clearing Corporation ("MCC"), a Colorado corporation.
The Trust is registered as an open-end management investment company under the
Investment Company Act of 1940, as amended (the "IC Act") and has registered
itsshares of common stock (the "Shares") under the Securities Act of 1933,
as amended (the "1933 Act") in one or more distinct series of Shares
(the "Portfolio" or "Portfolios"). The Adviser has been appointed investment
adviser to the Portfolios of the Trust. MCC is registered as a broker-dealer
with the U.S. Securities and Exchange Commission (the "SEC") and is a
member in good standing of the National Association of Securities Dealers,
Inc. (the "NASD"). The Trust, the Adviser and the Distributor desire to
enter into this Agreement pursuant to which the Distributor will provide
distribution services to the Portfolios of the Trust identified on Schedule
A, as may be amended from time to time. The Fund desires to
retain MCC as Distributor of the Fund ("Distributor"), subject to the terms
and conditions of this Agreement.
In consideration of the premises and mutual covenants contained in this
Agreement, the Trust, the Adviser and MCC, intending to be legally bound
hereby, agree as follows:
1. APPOINTMENT OF DISTRIBUTOR. The Trust hereby appoints MCC as Distributor
for the distribution of the Trust's Shares, and MCC hereby accepts such
appointment under the terms of this Agreement. The Trust shall not sell any
Shares to any person except to fill orders for the Shares received through
the Distributor; provided, however, that the foregoing exclusive right
shall not apply: (i) to Shares issued or sold in connection with the
merger or consolidation of any other investment company with the Trust or
the acquisition by purchase or otherwise of all or substantially all of the
assets of any investment company or substantially all of the outstanding
shares of any such company by the Trust; (ii) to Shares which may be offered
by the Trust to its shareholders for reinvestment of cash distributed
from capital gains or net investment income of the Trust; or (iii) to Shares
which may be issued to shareholders of other funds who exercise any exchange
privilege set forth in the Trust's Prospectus. Notwithstanding any other
provision hereof, the Trust may terminate, suspend, or withdraw the offering
of the Shares whenever, in its sole discretion, it deems such action to be
desirable, and the Distributor shall process no further orders for Shares
after it receives notice of such termination, suspension or withdrawal.
2. TRUST DOCUMENTS. The Trust has provided the Distributor with properly
certified or authenticated copies of the following Trust related documents in
effect on the date hereof: the Trust's organizational documents, including
Master Trust Agreement and By-Laws; the Trust's Registration Statement on
Form N-1A, including all exhibits thereto; the Trust's most
current Prospectus and Statement of Additional Information; and resolutions of
the Trust's Board of Trustees authorizing the appointment of the Distributor
and approving this Agreement. The Trust shall promptly provide to the
Distributor copies, properly certified or authenticated, of all amendments
or supplements to the foregoing. The Trust shall also
provide to the Distributor copies of all other information which a
Distributor may reasonably request for use in connection with the
distribution of Shares, including, but not limited to, a certified copy of
all financial statements prepared for the Trust by its independent public
accountants. The Trust shall also supply the Distributor with such number of
copies of the current Prospectus, Statement of Additional Information and
shareholder reports as the Distributor shall reasonably request.
3. DISTRIBUTION SERVICES. The Distributor shall sell and repurchase Shares as
set forth below, subject to the registration requirements of the 1933 Act and
the rules and regulations thereunder, and the laws governing the sale of
securities in the various states ("Blue Sky Laws"):
a. The Distributor, as agent for the Trust, shall sell Shares to the public
against orders therefor at the public offering price, which shall be the net
asset value of the Shares then in effect.
b. The net asset value of the Shares shall be determined in the manner
provided in the then current Prospectus and Statement of Additional
Information. The net asset value of the Shares shall be calculated by the
Trust or by another entity on behalf of the Trust. The Distributor shall
have no duty to inquire into or liability for the accuracy of the net asset
value per Share as calculated.
c. Upon receipt of purchase instructions, the Distributor shall transmit such
instructions to the Trust or its transfer agent for registration of the Shares
purchased.
d. The Distributor shall also have the right to take, as agent for the
Trust, all actions which, in the Distributor's judgment, are necessary to
effect the distribution of Shares, in accordance with the Trust's policies,
procedures and disclosure documents.
e. Nothing in this Agreement shall prevent the Distributor or any "affiliated
person" from buying, selling or trading any securities for its or their own
account or for the accounts of others for whom it or they may be acting;
provided, however, that the Distributor expressly agrees that it shall not
for its own account purchase any Shares of the Trust except for investment
purposes and that it shall not for its own account sell any such
Shares except for redemption of such Shares by the Trust, and that it shall
not undertake activities which, in its judgment, would adversely affect the
performance of its obligations to the Trust under this Agreement.
f. The Distributor, as agent for the Trust, shall repurchase Shares at such
prices and upon such terms and conditions as shall be specified in the
Prospectus.
4. DISTRIBUTION SUPPORT SERVICES. In addition to the sale and repurchase of
Shares, the Distributor shall perform distribution support services. Such
distribution support services shall include: review of sales and marketing
literature and submission to the NASD; NASD record keeping; quarterly reports
to the Trust's Board of Directors and licensing Adviser or Trust personnel as
registered representatives of the Distributor and related supervisory
activities.
5. REASONABLE EFFORTS. The Distributor shall use all reasonable efforts in
connection with the distribution of Shares. The Distributor shall have no
obligation to sell any specific number of Shares and shall only sell Shares
against orders received therefor. The Trust shall retain the right to refuse
at any time to sell any of its Shares for any reason deemed adequate
by it.
6. COMPLIANCE. In furtherance of the distribution services being provided
hereunder, the Distributor and the Trust agree as follows:
a. The Distributor shall comply with the Rules of Fair Practice of the NASD
and the securities laws of any jurisdiction in which it sells, directly or
indirectly, Shares.
b. The Distributor shall require each dealer with whom it has a selling
agreement to conform to the applicable provisions of the Trust's most current
Prospectus and Statement of Additional Information, with respect to the
public offering price of the Shares.
c. The Trust agrees to furnish to the Distributor sufficient copies of any
agreements, plans, communications with the public or other materials it
intends to use in connection with any sales of Shares in a timely manner in
order to allow the Distributor to review, approve and file such materials
with the appropriate regulatory authorities and obtain
clearance for use. The Trust agrees not to use any such materials until so
filed and cleared for use by appropriate authorities and/or the Distributor.
d. The Distributor, at its own expense, shall qualify as a broker or dealer
under all applicable Federal or state laws required to permit the sale of
Shares in such states as shall be mutually agreed upon by the parties;
provided, however that the Distributor shall have
no obligation to register as a broker or dealer under the Blue Sky Laws of
any jurisdiction
if it determines that registering or maintaining registration in such
jurisdiction would be
uneconomical.
e. The Distributor shall not, in connection with any sale or solicitation of a
sale of
the Shares, make or authorize any representative, service organization,
broker or dealer to
make, any representations concerning the Shares except those contained in the
Trust's most
current Prospectus covering the Shares and in communications with the public or
sales
materials approved by the Distributor as information supplemental to such
Prospectus.
7. EXPENSES. Expenses shall be allocated as follows:
a. The Trust shall bear the following expenses: preparation, setting in type,
and
printing of sufficient copies of the Prospectus and Statement of Additional
Information for
distribution to existing shareholders; preparation and printing of reports
and other
communications to existing shareholders; distribution of copies of the
Prospectus, Statement
of Additional Information and all other communications to existing
shareholders;
registration of the Shares under the Federal securities laws; qualification of
the Shares for
sale in the jurisdictions mutually agreed upon by the Trust and the Distributor;
transfer
agent/shareholder servicing agent services; supplying information, prices and
other data to
be furnished by the Trust under this Agreement; and any original issue taxes
or transfer taxes
applicable to the sale or delivery of the Shares or certificates.
b. The Adviser shall pay all other expenses incident to the sale and
distribution of
the Shares sold hereunder, including, without limitation: printing and
distributing copies of
the Prospectus, Statement of Additional Information and reports prepared for
use in
connection with the offering of Shares for sale to the public; advertising in
connection with
such offering, including public relations services, sales presentations, media
charges,
preparation, printing and mailing of advertising and sales literature; data
processing
necessary to support a distribution effort; distribution and shareholder
servicing activities
of broker-dealers and other financial institutions; filing fees required by
regulatory
authorities for sales literature and advertising materials; any additional
out-of-pocket
expenses incurred in connection with the foregoing and any other costs of
distribution.
8. COMPENSATION. For the distribution and distribution support services
provided by
the Distributor pursuant to the terms of the Agreement, the Trust shall
reimburse the
Distributor for its out-of-pocket expenses related to the performance of their
duties
hereunder, including, without limitation, telecommunications charges, postage
and delivery
charges, record retention costs, reproduction charges and traveling and lodging
expenses
incurred by officers and employees of the Distributor. All rights of
reimbursement under
this Agreement for expenses incurred by the Distributor as of the termination
date shall
survive the termination of this Agreement. The parties acknowledge that the
Distributor will
receive no compensation, other than expense reimbursement, for distribution
services
rendered.
9. USE OF DISTRIBUTOR'S NAME. The Trust shall not use the name of the
Distributor
nor any of affiliates in the Prospectus, Statement of Additional Information,
sales literature
or other material relating to the Trust in a manner not approved prior thereto
in writing by
the Distributor; provided, however, that the Distributor shall approve all uses
of its and its
affiliates' names that merely refer in accurate terms to their appointments or
that are required
by the Securities and Exchange Commission (the "SEC") or any state securities
commission;
and further provided, that in no event shall such approval be unreasonably
withheld.
10. USE OF TRUST'S NAME. The Distributor nor any of its affiliates shall use
the name
of the Trust or material relating to the Trust on any forms (including any
checks, bank drafts
or bank statements) for other than internal use in a manner not approved prior
thereto in
writing by the Trust; provided, however, that the Trust shall approve all uses
of its name that
merely refer in accurate terms to the appointment of the Distributor hereunder
or that are
required by the SEC or any state securities commission; and further provided,
that in no
event shall such approval be unreasonably withheld.
11. LIABILITY OF DISTRIBUTOR. The duties of the Distributor shall be limited
to those
expressly set forth herein, and no implied duties are assumed by or may be
asserted against
the Distributor. The Distributor may, in connection with this Agreement employ
agents or
attorneys in fact, and shall not be liable for any loss arising out of or in
connection with its
actions under this Agreement, so long as it acts in good faith and with due
diligence, and is
not negligent or guilty of any willful misfeasance, bad faith or gross
negligence, or reckless
disregard of its obligations and duties under this Agreement. As used in this
Section 11 and
in Section 12 (except the second paragraph of Section 12), the term
"Distributor" shall
include directors, officers, employees and other agents of the Distributor.
12. INDEMNIFICATION OF DISTRIBUTOR. Any director, officer, employee,
shareholder or agent of a Distributor who may be or become an officer, Trustee,
employee
or agent of the Trust, shall be deemed, when rendering services to the Trust or
acting on any
business of the Trust (other than services or business in connection with the
Distributor's
duties hereunder), to be rendering such services to or acting solely for the
Trust and not as
a director, officer, employee, shareholder or agent, or one under the control or
direction of
the Distributor, even though receiving a salary from the Distributor.
The Trust agrees to indemnify and hold harmless the Distributor, and each
person, who
controls the Distributor within the meaning of Section 15 of the 1933 Act, or
Section 20 of
the Securities Exchange Act of 1934, as amended ("1934 Act"), against any and
all
liabilities, losses, damages, claims and expenses, joint or several (including,
without
limitation, reasonable attorneys' fees and disbursements and investigation
expenses incident
thereto) to which it, or any of them, may become subject under the 1933 Act, the
1934 Act,
the 1940 Act or other Federal or state laws or regulations, at common law or
otherwise,
insofar as such liabilities, losses, damages, claims and expenses (or actions,
suits or
proceedings in respect thereof) arise out of or relate to any untrue statement
or alleged
untrue statement of a material fact contained in a Prospectus, Statement of
Additional
Information, supplement thereto, sales literature or other written information
prepared by
the Trust and provided by the Trust to the Distributor for the Distributor's
use hereunder, or
arise out of or relate to any omission or alleged omission to state therein a
material fact
required to be stated therein or necessary to make the statements therein not
misleading. The
Distributor (or any person controlling the Distributor) shall not be entitled
to indemnity
hereunder for any liabilities, losses, damages, claims or expenses (or actions,
suits or
proceedings in respect thereof) resulting from (i) an untrue statement or
omission or alleged
untrue statement or omission made in the Prospectus, Statement of Additional
Information,
or supplement, sales or other literature, in reliance upon and in conformity
with information
furnished in writing to the Trust by the Distributor specifically for use
therein or (ii) the
Distributor's own willful misfeasance, bad faith, gross negligence or reckless
disregard of
its duties and obligations in the performance of this Agreement.
The Distributor agrees to indemnify and hold harmless the Trust, and each
person
who controls the Trust within the meaning of Section 15 of the 1933 Act, or
Section 20 of
the 1934 Act, against any and all liabilities, losses, damages, claims and
expenses, joint or
several (including, without limitation reasonable attorneys' fees and
disbursements and
investigation expenses incident thereto) to which it, or any of them, may
become subject
under the 1933 Act, the 1934 Act, the 1940 Act or other Federal or state laws,
at common
law or otherwise, insofar as such liabilities, losses, damages, claims or
expenses arise out of
or relate to any untrue statement or alleged untrue statement of a material
fact contained in
the Prospectus or Statement of Additional Information or any supplement thereto,
sales
literature or other written material, or arise out of or relate to actions or
oral representations
of the Distributor's associated persons and to any omission or alleged omission
to state
therein a material fact required to be stated therein or necessary to make the
statements
therein not misleading, if based upon information furnished in writing to the
Trust by the
Distributor specifically for use therein.
13. ADVISER PERSONNEL. The Adviser agrees that only its employees who are
registered representatives of the Distributor ("dual employees") or registered
representatives
of another NASD member firm shall offer or sell Shares of the Portfolios. The
Adviser
further agrees that the activities of any such employees as registered
representatives of the
Distributor shall be limited to offering and selling Shares. If there are dual
employees, one
employee of the Adviser shall register as a principal of that the Distributor
and assist the
Distributor in monitoring the marketing and sales activities of the dual
employees. The
Adviser shall maintain errors and omissions and fidelity bond insurance
policies providing
reasonable coverage for its employees' activities and shall provide copies of
such policies
to the Distributor. The Adviser shall indemnify and hold harmless the
Distributor against
any and all liabilities, losses, damages, claims and expenses (including
reasonable attorneys'
fees and disbursements and investigation costs incident thereto) arising from
or related to
the Adviser's employees' activities as registered representatives,
including, without
limitation, any and all such liabilities, losses, damages, claims and expenses
arising from or
related to the breach by such employees of any rules or regulations of the
NASD or SEC.
14. DURATION. This Agreement shall become effective as of the date first above
written,
and shall remain in effect for one year from such date.
15. TERMINATION. Nothwithstanding Section 14 above:
a. This Agreement shall terminate automatically in the event of its assignment.
b. This Agreement shall terminate at any time upon a vote of the majority
of the
Trustees who are not interested persons of the Trust or by a vote of the
majority of the
outstanding voting securities of each Portfolio, upon not less than 60 days
prior written
notice to the Distributor.
16. AMENDMENT. The terms of this Agreement shall not be waived, altered,
modified,
amended or supplemented in any manner whatsoever except by a written instrument
signed
by the Distributor and the Trust and shall not become effective unless its
terms have been
approved by the majority of the Trustees of the Trust or by a "vote of
majority of the
outstanding voting securities" of each Portfolio and by a majority of those
Trustees who are
not "interested persons" of the Trust or any party to this Agreement.
17. NON-EXCLUSIVE SERVICES. The services of the Distributor rendered to
the Trust
are not exclusive. The Distributor may render such services to any other
investment
company.
18. DEFINITIONS. As used in this Agreement, the terms "vote of a
majority of the
outstanding voting securities," "assignment," "interested person" and
"affiliated person" shall
have the respective meanings specified in the 1940 Act and the rules
enacted thereunder as
now in effect or hereafter amended.
19. CONFIDENTIALITY. The Distributor shall treat confidentially and
as proprietary
information of the Trust all records and other information relating to the
Trust and prior,
present or potential shareholders and shall not use such records and
information for any
purpose other than performance of its responsibilities and duties hereunder,
except as may
be required by administrative or judicial tribunals or as requested by
the Trust.
20. NOTICE. All notices required under this Agreement shall be given
in writing,
addressed and delivered, or mailed postage prepaid, to the other parties at
the principal office
of each party.
21. GOVERNING LAW. This Agreement shall be construed and enforced in
accordance
with the laws of the State of Massachusetts and the applicable provisions of
the federal
securities laws. To the extent that the applicable law of the State of
Massachusetts or any
of the provisions herein conflict with the applicable provisions of the
federal securities laws,
the latter shall control.
22. ENTIRE AGREEMENT. This Agreement (including the Exhibits attached hereto)
contains the entire agreement and understanding of the parties and
supersedes all prior
written or oral agreements and understandings.
23. LIMITATION OF LIABILITY. The term "ICON Funds" means and refers to the
Trustees from time to time serving under the Master Trust Agreement of the
Trust dated
September 19, 1996, as amended from time to time. It is expressly agreed
that obligations
of the Trust hereunder shall not be binding upon any Trustee, Shareholder,
nominees,
officers, agents or employees of the Trust, personally, but bind only the
assets and property
of the Trust. The execution and delivery of this Agreement have been
authorized by the
Trustees of the Trust and signed by an authorized officer of the Trust,
acting as such, and
neither such authorization nor such execution and delivery shall be deemed
to have been
made by any of them individually or to impose any liability on any of them
personally, but
shall bind only the assets and property of the Trust.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
day and
year first above written.
ICON FUNDS MERIDIAN CLEARING CORPORATION
By: __/s/_____________________ By: __/s/___________________________
Erik Jonson, Chief Financial Officer Deborah Zele Urtz, Assistant Secretary
MERIDIAN INVESTMENT MANAGEMENT CORPORATION
By: __/s/______________________________
Craig T. Callahan, President
SCHEDULE A
ICON FUNDS
Portfolios covered by Distribution Agreement:
ICON Basic Materials Fund ICON Asia Region Fund
ICON Capital Goods Fund ICON South Pacific
Region Fund
ICON Consumer Cyclicals Fund ICON North Europe
Region Fund
ICON Consumer Staples Fund ICON South Europe Region
Fund
ICON Energy Fund ICON Western Hemisphere
Fund
ICON Financial Services Fund
ICON Healthcare Fund
ICON Leisure Fund
ICON Technology Fund
ICON Telecommunication & Utilities Fund
ICON Transportation Fund
ICON Short-Term Fixed Income Fund
ICON FUNDS
ADMINISTRATIVE SERVICES AGREEMENT
This Agreement, dated as of March 1, 1999, is between the ICON Funds
(the "Trust"), a Massachusetts business trust, and Meridian Investment
Management Corporation ("Meridian"), a Colorado corporation.
The Trust is registered as an open-end management investment company
registered under the Investment Company Act of 1940 (the "IC Act"). The
Trust desires to retain Meridian and avail itself of the information, advice,
assistance and facilities of Meridian by retaining it as Administrator of the
Trust ("Administrator"), subject to the terms and conditions of this
Agreement. The Administrator wishes to provide such services to the Trust
under the conditions set forth below.
In consideration of the premises and mutual covenants contained in this
Agreement, the Trust and the Administrator agree as follows:
1. EMPLOYMENT. The Trust, being duly authorized, hereby retains the
Administrator to perform those services described in this Agreement and the
Administrator shall perform its obligations upon the terms and conditions
set forth in this Agreement. Any administrative services undertaken by the
Administrator pursuant to this Agreement, as well as any other activities of
the Administrator on behalf of the Trust, shall at all times be subject to
directives of the Board of Trustees of the Trust.
2. TRUST ADMINISTRATION. The Trust hereby retains the Administrator to
provide executive and administrative services to the Trust, with the
individual responsibilities of Meridian more fully defined in Exhibit A to
this Agreement. The Administrator shall give the Trust the benefit of its
best judgment, efforts and facilities in rendering services as administrator.
The Administrator shall at all times conform to: (i) all applicable provisions
of the IC Act and any rules and regulations adopted thereunder, (ii) the
provisions of the Registration Statement of the Trust under the
ct of 1933, as amended from time to time, (iii) the provisions of the
Agreement and Declaration of Trust and the By-Laws of the Trust, and (iv)any
other applicable provisions of state and federal law.
3. STAFFING AND FACILITIES. The Administrator shall, at its own expense,
employ or retain personnel and consult with such other persons as it may
determine to be necessary or useful to the performance of its obligations
under this Agreement. The Administrator shall also provide personnel to
serve as officers of the Trust if so elected by the Board of Trustees.
The Administrator, shall, at its own expense, provide such office space,
facilities and equipment (including, but not limited to, computer equipment,
communication lines and supplies) to provide the services to the Trust.
4. RECORD KEEPING AND OTHER INFORMATION. The Administrator shall
create and maintain all necessary records in accordance with all applicable
laws, rules and regulations, including but not limited to records required
by Section 31(a) of the IC Act and the rules thereunder, as the same may be
amended from time to time, pertaining to the various functions performed by
it and not otherwise created and maintained by another party pursuant to
contract with the Trust. Where applicable, such records shall be maintained
by the Administrator for the periods and in the places required by rule
31a-2 under the IC Act. It is understood that the records created by the
Administrator on behalf of the Trust are the property of the Trust and will
be surrendered promptly upon request.
5. AUDIT, INSPECTION AND VISITATION. The Administrator shall make
available to the Trust during regular business hours all records and other
data created and maintained pursuant to the foregoing provisions of this
Agreement for reasonable audit and inspection by the Trust or any regulatory
agency having authority over the Trust. The Administrator shall also permit
representatives of the Trust, including the Trust's independent auditors, to
have reasonable access to the personnel and records of the Administrator in
order to enable such representatives to monitor the quality of services
being provided and the reasonableness of fees due the Administrator pursuant
to this Agreement. In addition, the Administrator shall promptly deliver to
the Board of Trustees of the Trust such information as may reasonably be
requested from time to time to permit the Board of Trustees to make an
informed determination regarding continuation of this Agreement.
6. COMPENSATION. For the services rendered to the Trust by the Administrator,
each series of the Trust shall pay the Administrator, upon presentation of
an invoice to the Fund's custodian, a fee as set out in the fee schedule
attached hereto as Exhibit B. In addition, the Trust shall reimburse the
Administrator for out of pocket expenses incurred on behalf of the Trust.
The Administrator shall not be required to reimburse the Trust or the Trust's
investment adviser for (or have deducted from its fees) an
excess of expense limitations imposed by certain state securities commission
s having jurisdiction over the Trust.
7. LIMITATION OF LIABILITY. The Administrator may rely on information
reasonably believed by it to be accurate and reliable. Except as may be
required by the Act or the rules thereunder, the Administrator nor its
shareholders, officers, directors, employees, agents, control persons or
affiliates shall be subject to liability for, or any damages, expenses or
losses incurred by the Trust except by reason of willful misfeasance, bad
faith or negligence on the part of any such person in the performance of
the duties of the Administrator under this Agreement or by reason of reckless
disregard of the obligations and duties of the Administrator under this
Agreement.
8. INDEMNIFICATION OF ADMINISTRATOR. Subject to and except as
otherwise provided in the Securities Act of 1933, as amended, and the IC Act,
the Trust shall indemnify Administrator and each of Administrator's Employees
(hereinafter collectively referred to as a "Covered Person") against all
liabilities, including but not limited to amounts paid in satisfaction of
judgments, in compromise or as fines and penalties, and expenses, including
reasonable accountants' and counsel fees, incurred by any Covered Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may haved as a
party or otherwise or with which such person may be or may
have been threatened, while serving as the administrator for the Trust or as
one of Administrator's Employees, or, thereafter, by reason of being or
having been the administrator for the Trust or one of Administrator's
Employees, including but not limited to, liabilities arising due to any
misrepresentation or misstatement in the Trust's prospectus, other regulatory
filings, and amendments thereto, or in other documents originating from the
Trust that are not otherwise the responsibility of the person seeking
indemnification. Notwithstanding the foregoing, in no case shall a
Covered Person be indemnified against any liability to which such Covered
Person would otherwise be subject by reason of willful misfeasance,
bad faith, negligence or reckless disregard of the duties of such Covered
Person.
9. SERVICES FOR OTHERS. Nothing in this Agreement shall prevent the
Administrator or any affiliated person of the Administrator from providing
services for any other person, firm or corporation, including other
investment companies; provided, however, that the Administrator expressly
represents that it will not undertake any activities which, in its judgment,
will adversely affect the performance of its obligations to the Trust under
this Agreement.
10. COMPLIANCE WITH THE ACT. The parties hereto acknowledge and agree
that nothing contained in this Agreement shall be construed to supersede or
contravene the Prospectus or Statement of Additional Information of any
series of the Trust or any provisions of the Act and the rules thereunder.
It is acknowledged that Meridian is an investment adviser to the Trust.
11. RENEWAL AND TERMINATION. This Agreement shall become effective on
the date first above written and shall remain in effect for a period of one
year from such date, and thereafter shall be renewed automatically for
successive one year terms, unless written notice not to renew is given by
the non-renewing party to the other party at least sixty days prior
to the expiration of the current term, provided such continuance is
approved at least annually by the vote of a majority of the Trustees of the
fund who are not parties to this Agreement or "interested persons" (as
defined in the IC Act) of any such party, which vote must be cast in person at
a meeting called for the purpose of voting on such approval. The previous
Administrative Services Agreement between the Trust and AmeriPrime Financial
Services, Inc. and Meridian is hereby superseded by this Agreement.
Notwithstanding the foregoing, the Trust may, at any time and without the
payment of any penalty, terminate this Agreement for Cause as to the
Administrator, upon sixty days written notice to the other party. "Cause"
shall mean unreasonable neglect or refusal to perform the services defined
under this Agreement, or the willful misconduct in following the legitimate
directions of the Board of Trustees of the Trust.
12. NOTICES. Any notice required under this Agreement shall be given in
writing, addressed and delivered, or mailed postage prepaid, to the other
parties at the principal office of each party.
13. THE TRUST. The term "ICON Funds" means and refers to the Trustees from
time to time serving under the Trust's Agreement and Declaration of Trust as
amended from time to time. It is expressly agreed that the obligations of the
Trust hereunder shall not be binding upon any of the Trustees, shareholders,
nominees, officers, agent or employees of the Trust, personally, but bind
only the trust property of the Trust. The execution and delivery of this
Agreement have been authorized by the Trustees of the Trust and signed by
an officer of the Trust, acting as such, and neither such authorization by
such Trustees nor such execution and delivery by such officer
med to have been made by any of them individually or to impose any liability
on any of them personally, but shall bind only the trust property of the Trust.
14. MISCELLANEOUS. This Agreement shall be construed and enforced in
accordance with and governed by the laws of the State of Massachusetts and
the applicable provisions of the federal securities laws. To the extent that
applicable law of the State of Massachusetts or any of the provisions herein
conflict with the applicable provisions of the federal securities laws, the
latter shall control . Every contract, instrument, certificate or
undertaking made or issued by the Trustees or by any officer of the Trust
shall give notice that (a) the document was executed or made on behalf of the
Trust or by them as Trustees or as officers and not by them individually, and
(b) that the obligations of such instrument are not binding upon any
of them or the Shareholders individually, but are only upon the assets and
property of the Trust. Omission of such notice shall not operate to bind
any Trustee, officer or shareholder individually.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
day and year first above written.
ICON FUNDS MERIDIAN INVESTMENT MANAGEMENT CORPORATION
By: __/s/____________________________ By: ___/s/______________________
Erik Jonson, Chief Financial Officer Craig T. Callahan, President
EXHIBIT A
ICON FUNDS
ADMINISTRATIVE SERVICES AGREEMENT
Dated March 1, 1999
The Administrator, Meridian Investment Management Corporation ("Meridian")
shall provide the following categories of executive and administrative
services to the Trust:
ADMINISTRATIVE RESPONSIBILITIES
1. Daily Compliance-Test all Funds for SEC, IRS and Prospectus Restrictions
2. Review and resolve all potential restriction violations
3. Blue Sky Monitoring
4. Compile information for annual review of Fidelity Bond
5. Compile information for annual review of E&O Insurance
6. Review of trading commissions, soft dollars and best execution
7. Tax preparation
8. Subchapter M Compliance
9. Review PFIC status for tax
10. Expense Accruals
11. Review and approve all invoices
12. Review and approve all monthly accounting transition reports
13. Review daily cash balances available for investment or redemption
14. Review pricing of portfolio securities and NAV computations
15. Monitor compliance with and revise Code of Ethics, as needed
16. Prepare and update policies and procedures manual
17. Proxy voting and recording with respect to portfolio securities
18. Preparation of quarterly trustee meeting information and reports
19. Preparation of Board Minutes
20. Preparation of reports to Lipper, Morningstar
21. Maintain relationship with ICI
22. Relations with third party vendors
23. Prepare prospectus and statement of additional information
24. Prepare semi-annual and year end financials
25. Prepare and File SEC reports and registration statements
26. Maintain files of all original fund documents
27. Relations with Custodian, Transfer Agent, auditors
28. Maintain relationships with Platforms
29. Maintain relationships with other Broker-Dealers
EXHIBIT B
ICON FUNDS
ADMINISTRATIVE SERVICES AGREEMENT
Dated March 1, 1999
MONTHLY FEE SCHEDULE
I. FEE SCHEDULE
The Funds of the Trust shall pay the Administrator the following fee per
year per Portfolio base, computed on a daily basis and paid on a monthly
basis. For purposes of each daily calculation of this fee, the most recently
determined net asset value of each Portfolio, as determined by a valuation
made in accordance with the Trust's procedure for calculating each
Portfolio's net asset value as described in the Funds' Prospectus and/or
Statement of Additional Information, shall be used. The fee is
payable on the first business day following the end of each month.
AVERAGE VALUE OF DAILY NET ASSETS ANNUAL RATE
Assets Under Five Hundred Million Dollars 0.050%
Assets Over Five Hundred Million Dollars 0.040%
Consent of Independent Accountants
We hereby consent to the reference to us under the heading "Financial
Highlights" in the Prospectus and under the heading "Independent
Accountants and Counsel" in the Statement of Additional Information
constituting parts of this Post-Effective Amendment No. 4 to the Registration
Statement on Form N-1A of ICON Funds.
/s/
PricewaterhouseCoopers LLP
Denver, Colorado
September 20, 1999
POWER OF ATTORNEY
We the undersigned officers and Trustees of ICON Funds (the
"Trust"), do hereby severally constitute and appoint Erik L. Jonson,
Charles W. Lutter, Jr. and Robin B. Shipman, and each of them acting singularly,
as our true and lawful attorneys, with full powers to them and each of them to
sign for us, in our names in the capacities indicated below, any
amendment to the Registration Statement of the Trust on Form N-1A to be
filed with the Securities and Exchange Commission and to take such further
action in respect thereto as they, in their sole discretion, deem
necessary to enable the Trust to comply with the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940 and all
requirements and regulations of the Securities and Exchange Commission,
hereby ratifying and confirming our signatures as they may be signed by our
said attorneys to any and all documents related to said amendment to the
Registration Statement.
IN WITNESS WHEREOF, we have hereunto set out hands on the
dates indicated below.
SIGNATURE TITLE DATE
_/s/__________________ PRESIDENT AND TRUSTEE ____4-99_______
Craig T. Callahan
_/s/_____________________ TRUSTEE ____4-99___________
R. Michael Sentel
_/s/_____________________ TRUSTEE _____4-99___________
James W. Hire
_/s/_____________________ TRUSTEE _____4-99__________
Glen F. Bergert
_/s/_____________________ VICE PRESIDENT AND ____4-99___________
Erik L. Jonson CHIEF FINANCIAL OFFICER
_/s/_____________________ VICE PRESIDENT AND _____4-99__________
Robin B. Shipman SECRETARY
