UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1935 (Amendment No. ___)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for use of the Commission only (as permitted by Rule 14a-6(e)
(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-12
ICON FUNDS
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(I) (4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed pursuant
to Exchange act Rule 0-11 (set forth the amount on which the filing fee
is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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September 25, 2002
Dear Fellow Shareholder:
The ICON Funds will hold a special meeting of shareholders on November 1, 2002
at our offices in Greenwood Village, Colorado. The purpose of the meeting is to
vote on some important proposals affecting the Funds and you as a shareholder.
This package contains information about the proposals, a proxy, and business
reply envelope permitting you to vote by mail, and simple instructions on how to
vote by phone or via the Internet.
As you will see from the enclosed materials, your Board of Trustees is
requesting that you elect four Trustees to the ICON Funds Board. In addition,
the Board is requesting that you approve changes to certain investment
restrictions for your Funds. These changes are intended to modernize the
restrictions, give the Funds greater investment flexibility, and facilitate
portfolio compliance. We realize that the descriptions of some of these
techniques are complex. Please be assured, however, that the Board of Trustees
has carefully considered these proposals, believes they are in the best
interests of the Funds, and unanimously recommends your "yes" vote on each of
them.
YOUR VOTE IS IMPORTANT, NO MATTER HOW MANY SHARES YOU OWN. THE MATTERS WE
ARE SUBMITTING FOR YOUR CONSIDERATION ARE SIGNIFICANT TO THE FUNDS AND TO YOU AS
A FUND SHAREHOLDER. PLEASE TAKE THE TIME TO READ THE PROXY STATEMENT AND CAST
YOUR VOTE ON THE ENCLOSED PROXY CARD(S), BY PHONE OR VIA THE INTERNET. IF WE DO
NOT RECEIVE SUFFICIENT VOTES TO APPROVE THESE PROPOSALS, WE MAY HAVE TO SEND
ADDITIONAL MAILINGS OR CONDUCT TELEPHONE SOLICITATIONS. IN THIS REGARD, THE
COMPANY HAS RETAINED GEORGESON SHAREHOLDER COMMUNICATIONS, INC. TO ASSIST IN THE
SOLICITATION OF PROXIES. IF YOU DO NOT VOTE, YOU MAY RECEIVE A TELEPHONE CALL
FROM GEORGESON SHAREHOLDER COMMUNICATIONS, INC. REQUESTING YOUR VOTE.
We thank you for your prompt response to the Proxy Statement.
Sincerely,
/s/ Craig T. Callahan
- ------------------------------------
Craig T. Callahan
Chairman
ICON Funds
ICON FUNDS
PROXY STATEMENT
PLEASE VOTE
YOUR VOTE IS EXTREMELY IMPORTANT AND VOTING ONLY TAKES A FEW MINUTES.
ACT NOW TO HELP THE FUNDS AVOID ADDITIONAL EXPENSE.
ICON Funds (the "Trust") will hold a special meeting of shareholders on November
1, 2002. It is important for you to vote on the issues described in this Proxy
Statement. We recommend that you read the Proxy Statement in its entirety - the
explanations in the Proxy Statement will help you decide on the issues.
The following is an introduction to the proposals and the process:
Why am I being asked to vote?
Mutual funds are required to obtain shareholders' votes for certain types of
changes, like those included in this Proxy Statement. You have a right to vote
on these changes.
What issues am I being asked to vote on?
The proposals include the election of four Trustees to the Board and certain
changes to the Trust's fundamental investment policies.
What are the responsibilities of the Board of Trustees?
The Board of Trustees is responsible for the general oversight of the Trust's
business. The Board represents the shareholders and can exercise all of the
Trust's powers, except those reserved only for shareholders. The Board, for
example, periodically reviews the investment performance of the Funds as well as
the quality of other services provided to the Funds.
Why are Trustees being elected?
Three Trustees currently serve on the Board of the Trust. The Board has
determined that the Trust would benefit from a larger Board. The Board feels
that it would be beneficial to increase the number of Trustees to six and would
be beneficial to have new Trustees with a wide variety of backgrounds and
experiences to help decide issues faced by the Board.
Expansion of the Board requires shareholder approval because, under the
Investment Company Act of 1940 ("1940 Act"), the Board may fill vacancies or
appoint new Trustees, only if, immediately after, at least two-thirds of the
Trustees will have been elected by shareholders.
The Proxy Statement includes a brief description of each nominee's history and
current position with the Trust, if applicable. The Proxy Statement also
includes a brief description of those Trustees that have previously been elected
to the Board.
Why are some of the Trust's "fundamental policies" being changed or removed?
Every mutual fund has certain investment policies that can be changed only with
the approval of its shareholders. These are referred to as "fundamental"
investment policies.
In some cases, the policies of the Trust were adopted when the Trust was
established in 1996 to reflect regulatory, business, or industry conditions that
no longer exist or no longer are necessary. In other cases, advances in the
securities markets and the economy have created different procedures and
techniques that affect the Trust's operations.
By reducing the number of "fundamental policies," the Trust may be able to
minimize the costs and delays of future shareholder meetings. In addition, the
investment adviser's ability to manage the Trust's assets may be enhanced.
The proposed amendments will:
o Reclassify those fundamental policies that are not required to be fundamental
by the 1940 Act as "non-fundamental" policies;
o Simplify and modernize the policies that are required to be "fundamental" by
the 1940 Act; and
o Remove fundamental policies that are no longer required by the securities
laws of individual states.
What is the impact of having some "fundamental" policies being reclassified as
"non-fundamental" policies?
As noted above, some "fundamental" policies have been redefined as
"non-fundamental" policies. Non-fundamental policies require the approval of the
Board to be changed, but do not require shareholder approval. This gives the
Trust's Board additional flexibility to quickly respond to industry changes.
How do I vote my shares?
You may vote by telephone or through the Internet. Your proxy card has the
telephone number and website listed on it. You save the Trust time and postage
costs by voting by phone or through the Internet.
You may also vote by returning the enclosed Proxy Card. If you cast your vote by
telephone or through the Internet, please don't return your proxy card. If you
do not respond at all, Georgeson Shareholder Communications, Inc., the Funds'
proxy solicitor, may contact you by telephone to request that you cast your
vote.
Who do I call if I have questions about the Proxy Statement?
If you have any other questions or need further assistance in voting, please
feel free to call our proxy solicitor, Georgeson Shareholder Communications,
toll free at 1-866-444-1088.
After careful consideration, the Board of Trustees has unanimously approved
these proposals. The Board recommends that you read the enclosed materials
carefully and vote FOR all proposals.
ICON FUNDS
5299 DTC Boulevard, Suite 1200
Greenwood Village, Colorado 80111
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NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
November 1, 2002
-----------------------------------
To ICON Fund Shareholders:
A Special Meeting of Shareholders ("Meeting") of ICON Consumer
Discretionary Fund, ICON Energy Fund, ICON Financial Fund, ICON Healthcare Fund,
ICON Industrials Fund, ICON Information Technology Fund, ICON Leisure & Consumer
Staples Fund, ICON Materials Fund, ICON Telecommunication & Utilities Fund, ICON
Asia Pacific Region Fund, ICON North Europe Region Fund, ICON South Europe
Region Fund, ICON Short-Term Fixed Income Fund and ICON Core Equity Fund
(formerly the ICON Fund) (each a "Fund" and collectively the "Funds") each a
series of ICON Funds, will be held at the offices of the Funds, 5299 DTC
Boulevard, Suite 1200, Greenwood Village, Colorado on November 1, 2002 at 10:00
a.m. (Mountain Time). The Meeting is being held for the following purposes:
(1) To Elect Four Trustees to the Board of Trustees;
(2) Approve Changes to the Funds' Fundamental Investment Policies;
(3) To Consider and Act Upon any Other Business that May Properly Come
Before the Meeting or any Adjournments Thereof.
The Proposals are discussed in greater detail in the attached Proxy
Statement. You are entitled to vote at the Meeting and any adjournment thereof
if you owned shares of one or more of the Funds at the close of business on
September 10, 2002. If you attend the Meeting, you may vote your shares in
person. Whether or not you intend to attend the Meeting in person, you may vote
in any of the following ways:
(1) Mail: Vote, sign, date and return the enclosed proxy card in the
enclosed postage-paid envelope;
(2) Telephone: Have your proxy card available. Vote by telephone by
calling the toll-free number on your proxy card. You may call
anytime between 9:00 a.m. and 8:00 p.m. (Eastern Time). Enter the
12-digit control number on the proxy card. (A confirmation of your
telephone vote will be mailed to you); or
(3) Internet: Have your proxy card available. Vote on the Internet by
accessing the website listed on your proxy card. Enter your 12-digit
control number from your proxy card. Follow the simple instructions
found on the website.
By order of the Board of Trustees,
/s/ Andra C. Ozols
------------------------------
Andra C. Ozols, Secretary
ICON Funds
Dated: September 25, 2002
Greenwood Village, Colorado
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YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN.
PLEASE RETURN YOUR PROXY CARD PROMPTLY.
Shareholders are invited to attend the Meeting in person. Any shareholder who
does not expect to attend the Meeting is urged to indicate voting instructions
on the enclosed proxy card, date and sign it, and return it in the envelope
provided, which needs no postage if mailed in the United States. If you sign,
date and return the proxy card but give no instructions, your shares will be
voted "FOR" the Proposals described above and "FOR" or "AGAINST" any other
matter acted upon at the Meeting in the discretion of the persons named as
proxies. Alternatively, you may vote your proxy by telephone or on the Internet
in accordance with the instructions on the enclosed proxy card.
To avoid the additional expense of further solicitation, we ask your cooperation
in mailing your proxy promptly, no matter how large or small your holdings may
be.
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ICON FUNDS
5299 DTC Boulevard, Suite 1200
Greenwood Village, Colorado 80111
1-800-764-0442
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PROXY STATEMENT
------------------------------
Special Meeting of Shareholders
November 1, 2002
INTRODUCTION
This Proxy Statement is being furnished to the shareholders of ICON
Consumer Discretionary Fund, ICON Energy Fund, ICON Financial Fund, ICON
Healthcare Fund, ICON Industrials Fund, ICON Information Technology Fund, ICON
Leisure & Consumer Staples Fund, ICON Materials Fund, ICON Telecommunication &
Utilities Fund, ICON Asia Pacific Region Fund, ICON North Europe Region Fund,
ICON South Europe Region Fund, ICON Short-Term Fixed Income Fund and ICON Core
Equity Fund (each a "Fund" and collectively the "Funds"), each a series of ICON
Funds, a Massachusetts business trust ("ICON Funds" or "Trust"), by the Board of
Trustees ("Board") of ICON Funds in connection with the solicitation of
shareholder votes by proxy to be voted at the Special Meeting of Shareholders or
any adjournments thereof ("Meeting") to be held on November 1, 2002 at 10:00
a.m. (Mountain Time) at the offices of the Funds, 5299 DTC Boulevard, Suite
1200, Greenwood Village, Colorado 80111. It is expected that the Notice of
Special Meeting, Proxy Statement and proxy card will be first mailed to
shareholders on or about September 25, 2002.
As more fully described in this Proxy Statement, the purpose of the
Meeting is to vote on the following Proposals:
(1) To Elect Four Trustees to the Board of Trustees;
(2) Approve Changes to the Funds' Fundamental Investment Policies;
(3) To Consider and Act Upon any Other Business that May Properly Come
Before the Meeting or any Adjournments Thereof.
Summarized below are the Proposals that shareholders of each Fund are
being asked to consider:
1
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Proposal
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Applies to All Funds 1. To Elect Four Trustees to the Board
of Trustees.
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Apply to All Funds 2.A. To Modify a Fundamental Policy on
Issuing Senior Securities;
2.B. To Modify a Fundamental Policy on
Borrowing;
2.C. To Modify a Fundamental Policy on
Underwriting Securities;
2.D. To Approve the Elimination of a
Fundamental Policy on Margin
Purchases and Adopt a
Non-Fundamental Policy on Margin
Purchases;
2.E. To Approve the Elimination of a
Fundamental Policy on Short Sales
and Adopt a Non-Fundamental Policy
on Short Sales;
2.F. To Approve the Elimination of a
Fundamental Policy on Investing More
Than 5% of a Fund's Assets in the
Securities of Any One Issuer and the
Elimination of a Fundamental Policy
on Holding More Than 10% of the
Voting Securities of Any Issuer and
Adopt a Non-Fundamental Policy
Setting Forth the Diversification
Limits Required by the Internal
Revenue Code to Qualify as a
Regulated Investment Company;
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Applies to each Fund other than the 2.G. To Approve the Adoption of a
ICON Core Equity Fund (formerly the Fundamental Policy With Respect to
ICON Fund) the Investment Concentration of Each
Fund Other Than The ICON Core Equity
Fund.
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Apply to the ICON Core Equity Fund 2.H. To Approve the Adoption of a
(formerly the ICON Fund) Fundamental Policy With Respect to
the Investment Concentration of the
ICON Core Equity Fund.
2.I. To Modify as to the ICON Core Equity
Fund a Fundamental Policy on
Investing More than 5% of the Fund's
Assets in the Securities of Any One
Issuer.
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2
If the enclosed proxy card is executed properly and returned, shares
represented by it will be voted at the Meeting in accordance with the
instructions on the proxy. A proxy may nevertheless be revoked at any time prior
to its use by written notification received by ICON Funds, by the execution of a
subsequently dated proxy or by attending the Meeting and voting in person.
However, if no instructions are specified on a proxy, shares will be voted "FOR"
Proposals (1) through (2) listed above, and "FOR" or "AGAINST" any other matters
acted upon at the Meeting in the discretion of the persons named as proxies.
The close of business on September 10, 2002 has been fixed as the record
date for the determination of shareholders entitled to notice of and to vote at
the Meeting ("Record Date").
Each share will be entitled to one vote at the Meeting and fractional
shares will be entitled to proportionate fractional votes. As of the Record
Date, the following numbers of shares were outstanding with respect to each
class of each Fund:
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Number of
Shares
Outstanding
Fund
------------------------------------------------------------
ICON Consumer 18,092,644.464
Discretionary Fund
------------------------------------------------------------
ICON Energy Fund 6,443,215.526
------------------------------------------------------------
ICON Financial Fund 6,458,915.487
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ICON Healthcare Fund 6,860,139.397
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ICON Industrials Fund 14,133,274.691
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ICON Information 19,035,726.012
Technology Fund
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ICON Leisure & 7,995,622.286
Consumer Staples Fund
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ICON Materials Fund 7,684,942.248
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ICON Telecommunications 3,869,947.937
& Utilities Fund
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ICON Asia-Pacific Region 1,202,425.672
Fund
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ICON North Europe 1,360,374.420
Region Fund
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3
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Number of
Shares
Outstanding
Fund
------------------------------------------------------------
ICON South Europe 611,522.093
Region Fund
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ICON Short-Term 662,253.075
Fixed Income Fund
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ICON Core Equity Fund
------------------------------------------------------------
Class C Shares 2,806,914.927
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Class I Shares 4,111,443.418
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In addition, to the ICON Funds' knowledge, as of the Record Date, the
following are all of the record owners of more than 5% of the outstanding shares
of any class of each Fund:
Number of Shares Percentage
Name and Address of Record Shares Owned of the Fund
Owner Fund Name Beneficially Owned
Charles Schwab & Co. Inc.
101 Montgomery St. ICON Consumer 1,302,507.894 7.20%
San Francisco, CA Discretionary Fund
94104-4122 ICON Energy Fund 2,729,198.392 42.36%
ICON Financial Fund 2,468,186.637 38.21%
ICON Healthcare Fund 1,834,795.864 26.75%
ICON Information 5,970,731.842 31.67%
Technology Fund
ICON Leisure & Consumer 1,352,277.882 16.91%
Staples Fund
ICON Materials Fund 430,726.282 5.61%
ICON Telecommunication 384,307.148 9.93%
& Utilities Fund
ICON Short-Term Fixed 37,562.952 5.67%
Income Fund
ICON Core Equity Fund- 1,061,526.428 25.82%
Class I
IMS & CO
PO Box 3865 ICON Consumer 13,168,562.383 72.74%
Englewood, CO 80155-3865 Discretionary Fund
ICON Energy Fund 1,565,065.523 24.29%
ICON Financial Fund 2,519,345.376 39.01%
ICON Healthcare Fund 2,838,470.028 41.38%
ICON Industrials Fund 10,508,255.570 74.35%
ICON Information 5,146,818.107 27.04%
Technology Fund
ICON Leisure & Consumer 4,804,515.768 60.01%
Staples Fund
ICON Materials Fund 5,937,020.401 77.23%
4
Number of Shares Percentage
Name and Address of Record Shares Owned of the Fund
Owner Fund Name Beneficially Owned
ICON Telecommunication 2,249,069.539 58.12%
& Utilities Fund
ICON Asia-Pacific 753,824.097 62.69%
Region Fund
ICON North Europe 934,642.229 68.71%
Region Fund
ICON South Europe 409,454.813 66.96%
Region Fund
ICON Short-Term Fixed 380,363.857 57.44%
Income Fund
ICON Core Equity Fund- 1,105,674.356 26.89%
Class I
National Investor Service
Corp.
55 Water Street, Floor 32 ICON Energy Fund 400,649.288 6.22%
New York, NY 10041-0028
As of the Record Date, the Trustees and officers of the Trust, as a group,
beneficially or of record owned less than 1% of the outstanding shares of each
class of each Fund.
The Solicitation is made primarily by the mailing of this Proxy Statement
and the accompanying proxy card. Supplementary solicitations may be made by
mail, telephone, telegraph or in person by representatives of Georgeson
Shareholder Communications, Inc., Meridian Investment Management Corporation
(the "Adviser") or the Trust. All expenses in connection with preparing this
Proxy Statement and its enclosures and additional solicitation expenses will be
borne by the Funds.
Quorum; Adjournment: The presence at the Meeting, in person or by proxy,
of shareholders entitled to vote a majority of each Fund's outstanding shares is
required for a quorum. In the event that a quorum is not present or a quorum is
present at the Meeting but sufficient votes to approve the new item are not
received, the persons named as proxies may propose one or more adjournments of
such Meeting to permit further solicitation of proxies. The affirmative vote of
less than a majority of the votes entitled to be cast represented in person or
by proxy is sufficient for adjournments. In such case, the persons named as
proxies will vote those proxies which they are entitled to vote in favor of such
item "FOR" such an adjournment, and will vote those proxies required to be voted
against such item "AGAINST" such an adjournment. A shareholder vote may be taken
on the nominations in this Proxy Statement prior to any such adjournment if
sufficient votes have been received and it is otherwise appropriate.
Broker Non-Votes; Abstentions: Broker non-votes are shares held in street
name for which the broker indicates that instructions have not been received
from the beneficial owners or other persons entitled to vote and with respect to
which the broker does not have discretionary voting authority. Abstentions and
broker non-votes will be counted as shares present for purposes of determining
whether a quorum is present. Accordingly, abstentions and broker non-votes
effectively will be a vote against an adjournment of Proposal 2 because the
required vote is a percentage of the shares present at the Meeting, but will
have no impact on the Proposal to elect Trustees because the required vote is a
plurality of the votes cast at the Meeting.
Copies of ICON Funds most recent annual and semi-annual reports, including
financial statements, have previously been delivered to shareholders.
Shareholders may obtain a free copy of ICON Funds Annual Report for the fiscal
5
year ended September 30, 2001, including audited financial statements, and/or
ICON Funds Semi-Annual Report for the period ended March 31, 2002, by calling
toll-free at 1-800-764-0442 or by mailing a written request to ICON Funds, P.O.
Box 701, Milwaukee, Wisconsin 53201-0701.
PROPOSAL 1: ELECTION OF TRUSTEES
The Board has nominated the individuals identified below for election to
ICON Funds' Board of Trustees. Under the Proposal, shareholders are being asked
to vote on these nominees. Pertinent information about each nominee is set forth
below. One of the nominees currently serves as a Trustee of ICON Funds. Three
additional nominees are being proposed by the Independent Trustees now serving,
to serve as Trustees of the ICON Funds.
As a Massachusetts business trust, ICON Funds does not contemplate holding
annual shareholder meetings for the purpose of electing Trustees. Thus, the
Trustees will be elected for indefinite terms until a subsequent special
shareholder meeting is called for the purpose of electing Trustees. It is the
intention of the persons named in the enclosed proxy card to vote in favor of
the election of each nominee for Trustee. Each nominee has consented to be named
in this Proxy Statement and to serve as Trustee if elected. The Board has no
reason to believe that any of the nominees will become unavailable for election
as a Trustee, but if that should occur before the Meeting, the proxies will be
voted for such other nominee(s) as the Board may recommend. If at a future date
a Board vacancy shall exist, the remaining Trustees may fill such vacancy by
appointing another Trustee, so long as, immediately after the appointment, at
least two-thirds of the Trustees have been elected by shareholders.
The following table sets forth certain information regarding each nominee
for Trustee. The second table sets forth certain information about the two
Trustees that have previously been elected by shareholders of the Trust and are
therefore not standing for election.
6
INFORMATION REGARDING NOMINEES
FOR ELECTION AS TRUSTEE
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Term of
Position(s) Office- Principal
Held With Length Number of Occupation(s) Other
Name, Age ICON of Time Funds During the Past Directorships
and Address Funds Served* Overseen** Five Years Held
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INDEPENDENT
TRUSTEES:
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Glen F. Trustee, Since All 14 President, Director,
Bergert***; Audit 1999 ICON Venture Capital Herre Bros,
P.O. Box 220, Committee Funds. Management LLC Inc., a
Camp Hill, Member, (1997 to contracting
Pennsylvania, Valuation present); General company
17001; Age: 52. Committee Partner, SOGNO (1998 to
Member; Partners LP, a present);
Nominating venture capital Director, Delta
Committee company (2001 to Dental of
Member. present); General Pennsylvania
Partner, KPMG an insurance
Peat Marwick, LLP company
(1979 to 1997). (1998 to
2002);
Director, DDP
Inc., an
insurance
company
(1998 to
2002);
Director, Delta
Reinsurance
Corporation
(2000 to
2002).
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John C. Nominee. N/A N/A Chief Investment N/A
Pomeroy, Jr.; Officer and
103 Innovation Director of
Blvd, Suite Investments,
212, University Pennsylvania
Park, State University
Pennsylvania, (2001 to
16802; Age 55. present);
Portfolio Manager
and Product
Manager, Trinity
Investment
Management
Corporation, (1989 to
2001).
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7
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Term of
Position(s) Office- Principal
Held With Length Number of Occupation(s) Other
Name, Age ICON of Time Funds During the Past Directorships
and Address Funds Served* Overseen** Five Years Held
- --------------------------------------------------------------------------------------------------------
Gregory Kellam Nominee. N/A N/A Senior Vice Director-
Scott; 671 President - National
Gaylord Street, Law, General Board of
Denver, Counsel and Directors,
Colorado Secretary, Constituency
80206; Age: 54. GenCorp, Inc., a for Africa
multinational (1997 to
technology based present).
manufacturing company
(2002 to present);
Vice President and
General Counsel,
Kaiser-Hill Company
LLC, a nuclear clean-up
and environmental
remediation company
(2000 to 2002);
Justice, Colorado
Supreme Court (1993
to 2000).
- -----------------------------------------------------------------------------------------------------------
Jonathan F. Nominee. N/A N/A President and Director,
Zeschin; 1777 Founder, Wasatch
S. Harrison ESSENTIAL Funds (2002
Street, Advisers, Inc., a to present);
Skydeck; wealth management Director,
Denver, and investment Young
Colorado advisory firm Americans
80210; Age 48. (2000 to present); Education
Managing Partner, Foundation
JZ Partners LLC, and Young
a business Americans
consulting firm Bank(1998
for investment to present).
management
companies (1998 to
present); President,
Founders Asset
Management LLC;
an investment
management company
(1995 to 1998);
Executive Vice
President, INVESCO
Funds Group, an
investment advisory
company (1992 to
1995).
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8
* There is no defined term of office for Trustees of ICON Funds.
** A registration statement was filed on July 10, 2002 registering four
additional series of ICON Funds. That registration is expected to go
effective October 1, 2002.
*** Mr. Bergert is the only current Trustee who has not previously been
elected by the Funds' shareholders.
INFORMATION REGARDING PREVIOUSLY
ELECTED TRUSTEES
- ------------------------------------------------------------------------------------------------------------
Term of
Position(s) Office- Principal
Held With Length Number of Occupation(s) Other
Name, Age ICON of Time Funds During the Past Directorships
and Address Funds Served* Overseen** Five Years Held
- ------------------------------------------------------------------------------------------------------------
INDEPENDENT
TRUSTEE:
- ------------------------------------------------------------------------------------------------------------
R. Michael Trustee, Since All 14 Senior Attorney N/A
Sentel; 15663 Audit 1996 ICON for U.S.Department
Wedge Way, Committee Funds. of Education (1996
Morrison, Member, to present);
Colorado, 80465; Nominating owner, Sentel &
Age: 54. Committee Company, a law
Member, firm (1994 to
Valuation present).
Committee
Member.
- -----------------------------------------------------------------------------------------------------------
INTERESTED
TRUSTEE:
- -----------------------------------------------------------------------------------------------------------
Craig T. Trustee. Since All 14 President (1998 to N/A
Callahan,*** 1996 ICON present), Chief
5299 DTC Funds. Investment Officer
Boulevard, and Director (1991 to
Suite 1200, present) of Meridian
Greenwood Investment
Village, Management
Colorado; Corporation; President
Age: 51. (1998 to present),
Director (1991 to
present), and Vice
President(1991 to
1998) of Meridian
Clearing Corporation;
President (1998 to
present), Chief
Investment Officer
and Director (1994 to
present) and
Secretary/Treasurer
(1994 to 1998) of Meridian
Management & Research.
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9
* There is no defined term of office for Trustees of ICON Funds.
** A registration statement was filed on July 10, 2002 registering four
additional series of ICON Funds. That registration is expected to go
effective October 1, 2002.
*** Dr. Callahan settled an administrative proceeding with the Securities and
Exchange Commission in December 1998 related to certain recordkeeping and
performance advertising requirements. Dr. Callahan agreed, without
admitting or denying the allegations, to the entry of a cease and desist
order [In the Matter of Meridian Investment Management Corporation,
Michael J. Hart, and Craig T. Callahan; Investment Advisers Act Release
No. 1779 (December 28, 1998)].
Dr. Callahan is considered to be an "interested person" (as defined in the 1940
Act) of ICON Funds. Dr. Callahan is considered an interested person on the
basis of his ownership of the parent company of the Adviser, and on the basis
of his employment with the Funds' Adviser and Distributor.
Compensation of Trustees
A Trustee who is an "interested person" of ICON Funds, within the meaning
of Section 2(a)(19) of the 1940 Act, receives no salary or fees from ICON Funds.
Each Trustee who is not an interested person of ICON Funds (e.g., an
"Independent Trustee") receives a per meeting fee.
ICON Funds currently pays each Independent Trustee a per meeting fee of
$3,000, plus travel and other out-of-pocket expenses incurred by the Trustees in
attending Board meetings. The table below includes certain information relating
to the compensation of ICON Funds' Trustees for the fiscal year ended September
30, 2001. Annual Board fees may be reviewed periodically and changed by ICON
Funds' Board. The Board recently increased the annual Board fees to $12,000.
ICON Funds does not have any retirement plan for its Trustees.
10
Compensation Table
- -------------------------------------------------------------------------------
Name of Person and Position Aggregate Compensation From ICON Funds*
- -------------------------------------------------------------------------------
Craig T. Callahan, Chairman $0
- -------------------------------------------------------------------------------
Glen F. Bergert, Trustee $10,000
- -------------------------------------------------------------------------------
R. Michael Sentel, Trustee $10,000
- -------------------------------------------------------------------------------
James W. Hire** $10,000
- -------------------------------------------------------------------------------
* Represents aggregate compensation paid to each Trustee during the fiscal
year ended September 30, 2001. There are a total of 14 Funds in the Trust;
these Funds represent all of the portfolios in the ICON Fund Complex. A
registration statement was filed on July 10, 2002 registering four
additional series of ICON Funds. That registration is expected to become
effective October 1, 2002.
** Mr. Hire resigned as a Trustee of the Board effective as of June 18, 2002.
The following table shows each Trustee's or nominee's ownership of shares
of ICON Funds' shares as of June 30, 2002:
- -------------------------------------------------------------------------------------
Aggregate Dollar Range
of Equity Securities in
all Registered
Investment Companies
Dollar Range of Equity Overseen by Trustee in
Name of Trustee or Nominee Securities in the Fundsb Family of Investment
Companies
- -------------------------------------------------------------------------------------
Glen F. Bergert o Asia-Pacific Fund: $10,001 -$50,000
$1-$10,000
o Financial Fund:
$1-$10,000
o ICON Fund:
$1-$10,000
o Information Technology
Fund: $1-$10,000
- -------------------------------------------------------------------------------------
Craig T. Callahan o ICON Fund: over Over $100,000
$100,000
- -------------------------------------------------------------------------------------
John C. Pomeroy, Jr. None None
- -------------------------------------------------------------------------------------
R. Michael Sentel None None
- -------------------------------------------------------------------------------------
Gregory Kellam Scott None None
- -------------------------------------------------------------------------------------
Jonathan F. Zeschin None None
- -------------------------------------------------------------------------------------
Board of Trustees and Committee Meetings
Under applicable law, the Board is responsible for management of the Funds
and provides broad supervision over their affairs. Trust officers manage the
day-to-day operations of the Funds under the direction of the Board.
11
The Board met in person four times during the Trust's fiscal year ended
September 30, 2001. Each Trustee attended all of the meetings of the Board and
of any committee of which he was a member during that year.
Audit Committee. The Audit Committee was formed (a) to oversee generally
the Funds' accounting and financial reporting policies and practices, the Funds'
internal controls and, as appropriate, the internal controls of certain service
providers; (b) to oversee generally the quality and objectivity of ICON Funds'
financial statements and the independent audit thereof; and (c) to act as a
liaison between the ICON Funds' independent auditors and the full Board. The
Audit Committee is composed entirely of Independent Fund Trustees; its members
are Mr. Bergert and Mr. Sentel. The Audit Committee normally meets two times a
year, or as otherwise required. During the fiscal year ended September 30, 2001,
the Audit Committee met two times.
Valuation Committee. The Valuation Committee is responsible for
determining the methods used to value Fund securities for which market
quotations are not readily available, subject to the approval of the Board. The
Valuation Committee is composed entirely of Independent Fund Trustees. While the
Valuation Committee did not hold an in-person meeting during the fiscal year
ended September 30, 2001, its members acted on various valuation matters by
written consent.
Nominating Committee. The Nominating Committee is responsible for
nominating individuals to serve as trustees, including as Independent Fund
Trustees. The Nominating Committee is composed entirely of Independent Fund
Trustees; its members are Mr. Bergert and Mr. Sentel. The Committee will
consider nominees recommended by shareholders; shareholders may send resumes of
recommended persons to the attention of President, ICON Funds, 5299 DTC
Boulevard, Greenwood Village, Colorado 80111. The Nominating Committee meets as
required. During the fiscal year ended September 30, 2001, the Committee did not
meet.
Officers of ICON Funds
The following table lists the officers of the Trust. Each officer's
address is 5299 DTC Boulevard, Greenwood Village, Colorado 80111.
- --------------------------------------------------------------------------------
Position Held with Trust Principal Occupation
Name and Age and Length of Time Served* During Past Five Years
- --------------------------------------------------------------------------------
Craig T. Callahan President of the Trust President (1998 to
Age: 51 since its inception in present), Chief
1996. Investment Officer and
Director (1991 to
present) of Meridian
Investment Management
Corporation; President
(1998 to present),
Director (1991 to
present), and Vice
President (1991 to 1998)
of Meridian Clearing
Corporation; President
(1998 to present), Chief
Investment Officer and
Director (1994 to
present) and
Secretary/Treasurer
(1994 to 1998) of
Meridian Management &
Research.
- --------------------------------------------------------------------------------
12
- --------------------------------------------------------------------------------
Position Held with Trust* Principal Occupation
Name and Age and Length of Time Served During Past Five Years
- --------------------------------------------------------------------------------
Erik L. Jonson Vice President and Chief Chief Financial Officer
Age: 52 Financial Officer of the (1996 to present) and
Trust since its inception Vice President, Meridian
in 1996. Investment Management
Corporation (1998 to
Present); Chief Financial
Officer and Secretary,
Meridian Management &
Research Corporation
(1996 to present); Vice
President and Treasurer
(March 2002 to present);
Secretary/Treasurer,
Meridian Clearing
Corporation (1998 to
2002).
- --------------------------------------------------------------------------------
Andra C. Ozols Vice President and Vice President, General
Age: 41 Secretary of the Trust Counsel, and Secretary,
since March 2002. Meridian Investment
Vice President and Management Corporation
Secretary of Trust in (March 2002 to present
1998. and January 1998 to
October 1998); Vice
President and Secretary,
Meridian Clearing
Corporation (March 2002
to present); Vice
President (1999 to 2002)
and Assistant General
Counsel (October 1998 to
February 2002), Founder
Asset Management LLC;
Branch Chief (1993 to
1995) and Enforcement
Attorney (1990 to 1995
and 1996 to 1998) U.S.
Securities and Exchange
Commission.
- --------------------------------------------------------------------------------
* There is no defined term of office for Officers of ICON Funds.
The officers of the Trust are interested persons (as defined in the 1940 Act)
and receive no compensation directly from ICON Funds for performing the duties
of their offices.
Required Vote. Approval of Proposal 1 requires the affirmative vote of a
plurality of the votes cast at the Meeting in person or by proxy.
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS
THAT YOU VOTE "FOR" EACH OF THE NOMINEES
- -------------------------------------------------------------------------------
13
PROPOSAL 2: TO APPROVE CHANGES TO CERTAIN FUNDAMENTAL INVESTMENT POLICIES AND
OBJECTIVES OF THE FUNDS.
At a meeting on August 12, 2002, the Board unanimously approved, subject
to shareholder approval, certain changes to the Funds' fundamental investment
policies.
Reasons for the Proposed Changes. As required by the Investment Company
Act of 1940, as amended ("1940 Act"), each Fund has adopted certain fundamental
investment policies ("fundamental policies"), which are set forth in the Funds'
Statement of Additional Information. These fundamental policies may be changed
only with shareholder approval. Restrictions and policies that a Fund has not
specifically designated as being fundamental are considered to be "non-
fundamental" and may be changed by the Board without shareholder approval.
Certain of the fundamental policies that the Funds have adopted in the
past reflect business or industry conditions or statutory or regulatory
requirements that are no longer in effect. Other fundamental policies reflect
regulatory requirements that remain in effect, but which are not required to be
stated as fundamental, or in some cases even as non-fundamental policies. Also,
on October 11, 1996, the National Securities Markets Improvement Act of 1996
("NSMIA") was enacted. NSMIA created a national system of regulating mutual
funds by preempting certain state securities or "blue sky" laws that apply to
mutual funds. Therefore, certain of the fundamental policies reflect state
regulatory requirements with which the Funds are no longer required to comply.
Accordingly, the Board has approved revisions to certain of the Funds'
fundamental policies in order to modernize a number of the investment policies
that are required to be fundamental and to eliminate certain fundamental
policies that are not legally required. In some instances, if an existing
fundamental policy is eliminated because it is no longer required to be
fundamental, the Fund intends to implement a similar policy as a non-fundamental
policy.
The Board is sensitive to shareholder voting rights. However, the Board
believes that by reducing the number of investment policies that can be changed
only by shareholder vote, each Fund will be able to avoid the costs and delays
associated with a shareholder meeting when making changes to its investment
policies that, at a future time, the Board may consider desirable.
ALTHOUGH THE PROPOSED CHANGES WILL ALLOW THE FUNDS GREATER FLEXIBILITY TO
RESPOND TO FUTURE INVESTMENT OPPORTUNITIES, THE ADVISER HAS REPRESENTED TO THE
TRUSTEES THAT NONE OF THE PROPOSED CHANGES ARE INTENDED TO MODIFY THE WAY ANY
FUND IS CURRENTLY MANAGED. The Trustees do not anticipate that the proposed
changes, individually or in the aggregate, will change the level of risk
associated with investing in the Funds or the manner in which the Adviser
manages the Funds. If adopted, each Fund will interpret the new restrictions in
light of future rules and orders of the Securities and Exchange Commission
("SEC") and SEC staff interpretations of relevant law.
The text and a summary description of each proposed change to the affected
Funds' fundamental policies are set forth below. The text below also describes
those non-fundamental policies that the Funds intend to implement in conjunction
with the elimination of fundamental policies under this Proposal. To the extent
14
that a current fundamental policy is replaced by a non-fundamental policy, such
policy could in the future be changed by the Board without approval of the
affected shareholders, subject to disclosure to existing and prospective
investors, as may be required by law.
If approved by shareholders of the affected Fund, the modification or
elimination of a fundamental policy and, if applicable, the implementation of a
new non-fundamental policy shall become operative concurrently with the
effectiveness of an amendment to the Fund's registration statement describing
the change. If a Proposal is not approved as to a particular Fund, that Fund's
current policy with regard to that Proposal will remain unchanged.
PROPOSALS 2.A. THROUGH 2.G. APPLY TO ALL ICON FUNDS
2.A. To Modify a Fundamental Policy on Issuing Senior Securities.
Each Fund's current fundamental policy on issuing senior securities is as
follows:
No Fund may issue senior securities.
The Board recommends that shareholders vote to modify the policy set forth
above and replace it with the following:
No Fund may issue any senior security, except as permitted under the 1940
Act and except to the extent that the activities permitted by the Fund's
other investment restrictions may be deemed to give rise to a senior
security.
Reasons for Change. The purpose of the Proposal is to clarify exceptions
to the definition of "senior security," to eliminate any question about each
Fund's ability to use certain investment techniques that may be deemed to be
"senior securities" under the 1940 Act. Although the definition of "senior
security" involves complex statutory and regulatory concepts, a senior security
is generally thought of as an obligation of a Fund that involves a claim to the
Fund's assets or earnings that takes precedence over the claims of the Fund's
shareholders.
The 1940 Act generally prohibits mutual funds from issuing senior
securities; however, mutual funds are permitted to engage in certain types of
transactions that technically might be considered senior securities as long as
certain conditions are satisfied. The proposed fundamental restriction will
confirm the ability of the Funds to engage in these transactions which include,
among other things: purchasing and selling options, forward contracts, futures
contracts (including those relating to indices), and options on futures
contracts or indices; borrowing money to the extent permitted by the proposed
borrowing restriction; pledging their assets to the extent necessary to secure
permitted borrowings; and entering into commitments, including reverse
repurchase agreements and purchasing securities on a delayed delivery or
when-issued basis (which may obligate a Fund to pay money at a future date that
is longer than the normal settlement period). These activities do not constitute
the issuance of senior securities under current legal and regulatory
interpretations. From time to time, the staff of the SEC may adopt positions as
to whether other techniques that may potentially be senior securities are
nevertheless consistent with the policies and requirements of the 1940 Act.
Under the proposed restriction, the Funds would be permitted to use such
investment techniques, provided they are consistent with their other investment
15
restrictions. Thus, the new restriction would give the Funds flexibility to
adapt to changing regulatory positions regarding senior securities.
Effect of Change on Funds and Shareholders. Adoption of the proposed
senior securities limitation is not expected to have any material effect upon
the investment techniques employed by the Funds. It merely provides express
authorization to make investments or engage in practices permitted by other
Investment Restrictions.
2.B. To Modify a Fundamental Policy on Borrowing.
The current fundamental policy on borrowing is as follows:
No Fund may 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.
The Board recommends that shareholders vote to modify the policy set forth
above and replace it with the following:
No Fund may borrow money, except to the extent permitted under the 1940
Act, which currently limits borrowing to no more than 33 1/3% of the value
of the Fund's total assets.
Reasons for Change. This recommendation provides flexibility by permitting
the investment policy to mirror the restrictions on borrowing imposed by the
1940 Act. It also excludes from the restriction certain securities that could be
considered borrowing but do not represent the same kinds of risk as unrestricted
borrowing.
Effects of Change on Funds and Shareholders. The Funds currently intend to
borrow only for temporary or emergency purposes, such as, for example, meeting
excessive or unanticipated redemptions of Fund shares that exceed available
cash. Although the Funds do not intend to borrow for leveraging, under this
restriction the Funds could leverage if Meridian believed that leveraging was in
the Funds' best interests. Leveraging involves certain risks. For example,
leveraging by means of borrowing will exaggerate the effect of any increase or
decrease in the value of portfolio securities on a Fund's net asset value.
Additionally, money borrowed will be subject to interest and other costs.
To the extent the income derived from securities purchased with borrowed
funds exceeds the interest the Fund will have to pay, the Fund's total return
will be greater than it would be if leverage were not used. Conversely, if the
income from the assets obtained with borrowed funds is not sufficient to cover
the cost of leveraging, the net income of the Fund will be less than it would be
if leverage were not used, and therefore the amount available for distribution
to the Fund's shareholders, as dividends will be reduced. Reverse repurchase
agreements create leverage and are considered borrowing for purposes of the
Fund's investment limitations.
16
2.C. To Modify a Fundamental Policy on Underwriting Securities.
Each Fund's current fundamental policy on underwriting securities is as
follows:
No Fund may underwrite the securities of other issuers.
The Board recommends that shareholders vote to modify the policy set forth
above and replace it with the following:
No Fund may act as an underwriter of securities of other issuers, except
to the extent that a Fund may be deemed to be an underwriter under the
Securities Act of 1933, as amended, in connection with disposing of
portfolio securities or investments in other investment companies.
Reasons for Change. This recommendation includes an exception which
clarifies that a Fund may dispose of portfolio securities even though the Fund
technically could be considered an underwriter under the federal securities laws
in connection with the disposition. Although this exception likely is inherent
in the current restriction, the proposed restriction clearly provides for the
exception.
Effect of Change on Funds and Shareholders. This change merely clarifies
the scope of the restriction and will not change the Funds' investment practices
or increase risk to shareholders.
2.D. To Approve the Elimination of a Fundamental Policy on Margin Purchases
and Adopt a Non-Fundamental Policy on Margin Purchases.
Each Fund's current fundamental policy on buying on margin is as follows:
No Fund may 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.
The Board recommends that shareholders vote to eliminate this fundamental
policy. If the Proposal is approved by shareholders, the following
non-fundamental policy will be adopted for each Fund:
No Fund may purchase securities on margin, except to obtain such
short-term credits as may be necessary for the clearance of transactions,
and except that a Fund may make margin deposits in connection with
transactions in forward contracts, futures contracts (including those
related to indices), options on future contracts or indices, and other
financial instruments, and to the extent necessary to effect foreign
currency transactions.
Reasons for Change. The 1940 Act makes it unlawful for a Fund to purchase
securities on margin except for such short-term credits as necessary for the
clearance of transactions and except as the Securities and Exchange Commission
("SEC") may prescribe. However, the 1940 Act does not require that this be
17
stated as a fundamental policy. If this Proposal is approved by the shareholders
of a Fund, the Fund will implement the proposed non-fundamental policy set forth
above. The proposed non-fundamental policy permits a Fund to purchase securities
on margin under certain circumstances and makes clear that short-term credits
necessary for the clearance of transactions and margin payments and other
deposits made in connection with financial instruments are not considered
purchasing securities on margin. The Board believes that elimination of the
fundamental policy and adoption of the non-fundamental policy will provide the
Funds with greater investment flexibility.
Effect of Change on Funds and Shareholders. Elimination of the fundamental
restriction prohibiting purchases of securities on margin is not expected to
have any material effect upon the investment techniques employed by the Funds.
Substitution of the non-fundamental restriction continues the prohibition
against the purchase of securities on margin, but provides express authorization
to make investments or engage in practices permitted by other investment
restrictions and by existing laws and regulations.
2.E. To Approve the Elimination of a Fundamental Policy on Short Sales and
Adopt a Non-Fundamental Policy on Short Sales.
Each Fund's current fundamental policy on selling short is as follows:
No Fund may make short sales in situations where the security is not owned
by the Fund.
The Board recommends that shareholders vote to eliminate this fundamental
policy. If the Proposal is approved by shareholders, the following
non-fundamental policy will be adopted for each Fund:
No Fund may sell securities short unless it owns or has the right to
obtain securities equivalent in kind and amount to the securities sold
short; provided, however, that this restriction shall not prevent a Fund
from entering into short positions in options, futures contracts, forward
contracts, foreign currency, and other financial instruments.
Reasons for Change. The 1940 Act makes it unlawful for a Fund to effect a
short sale of any security, except in connection with an underwriting in which
the Fund is a participant and except as the SEC may prescribe. However, the 1940
Act does not require that this be stated as a fundamental policy. The proposed
non-fundamental policy outlines exceptions to the policy, which generally
prohibits a Fund from selling securities short. In a short sale, an investor
sells a borrowed security and has a corresponding obligation to the lender to
return the identical security. The proposed non-fundamental policy permits short
sales "against the box," when an investor sells securities short while owning
the same securities in the same amount or having the right to obtain equivalent
securities. It also permits a Fund to borrow a security on a short-term basis
and to enter into short positions in a variety of financial instruments. The
Board believes that elimination of the fundamental policy and adoption of the
non-fundamental policy will provide the Funds with greater investment
flexibility.
Effect of Change on Funds and Shareholders. Elimination of the fundamental
restriction prohibiting short sales if the security is not owned by the Fund is
18
not expected to have any material effect upon the investment techniques employed
by the Funds. Substitution of the non-fundamental restriction continues the
prohibition against selling securities short if not owned by the Fund, but also
enables a Fund to sell a security short if the Fund has the right to obtain
equivalent securities.
2.F To Approve the Elimination of a Fundamental Policy on Investing More Than
5% of a Fund's Assets in the Securities of Any One Issuer and the
Elimination of a Fundamental Policy on Holding More Than 10% of the Voting
Securities of Any Issuer and Adopt a Non-Fundamental Policy Setting Forth
the Diversification Limits Required Under the Internal Revenue Code to
Qualify as a Regulated Investment Company.
Each Fund's current fundamental policy on investing more than 5% of a
Fund's assets in the securities of any one issuer is as follows:
No Fund may 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.
Each Fund's current fundamental policy on investing more than 10% of a
Fund's assets in the securities of any one issuer is as follows:
No Fund may acquire more than 10% of the voting securities of any one
issuer.
The Board recommends that shareholders vote to eliminate these fundamental
policies. If the Proposal is approved by shareholders, the following
non-fundamental policy will be adopted for each Fund:
In order to qualify as a "regulated investment company" under Subchapter M
of the Internal Revenue Code of 1986, as amended, the Funds intend to
comply with certain diversification limits imposed by Subchapter M.
Reasons for Change. The current fundamental restrictions relate to the
diversification tests for mutual funds under the Internal Revenue Code of 1986,
as amended (the "Code"). Under the 1940 Act, a fund is not required to adopt the
diversification tests under the Code as fundamental restrictions. The Trustees
therefore recommend that each Fund eliminate these fundamental diversification
restrictions. This will provide the Funds with significantly increased
flexibility in adapting to future SEC and Internal Revenue Service rule changes
and interpretations. This change will not, however, change the way the Funds
currently operate.
The non-fundamental policy that would be adopted by the Board would
reiterate that the Funds intend to comply with the diversification requirements
of the Code. For purposes of the Code's diversification requirements, Subchapter
M generally requires that a Fund invest no more than 25% of its total assets in
securities of any one issuer and to invest at least 50% of its total assets so
that (a) no more than 5% of a Fund's total assets are invested in securities of
any one issuer, and (b) a Fund does not hold more than 10% of the outstanding
voting securities of that issuer. However, Subchapter M allows unlimited
investments in cash, cash items, government securities (as defined in Subchapter
M) and securities of other regulated investment companies.
19
Effect of Change on Funds and Shareholders. Elimination of these
fundamental restrictions prohibiting investments of more than 5% of the value of
a Fund's total assets in securities of any one issuer with respect to 50% of a
Fund, and prohibiting the purchase of more than 10% of the outstanding voting
securities of an issuer, is not expected to have any material effect upon the
investment techniques employed by the Funds. Substitution of the non-fundamental
restriction modifies the way in which the Funds state their compliance with the
diversification requirements of Subchapter M of the Code.
PROPOSAL 2.G. APPLIES TO EACH FUND OTHER THAN THE ICON CORE EQUITY FUND
(formerly the ICON Fund).
2.G. To Approve the Adoption of a Fundamental Policy With Respect to the
Investment Concentration of the Funds other than the ICON Core Equity
Fund.
The Board recommends that shareholders vote to adopt the following
fundamental policy for the Funds other than the ICON Core Equity Fund.
Each Fund is a sector fund and may concentrate its investments in certain
industries or groups of industries included within the sector in which the
Fund invests.
Reasons for Changes. The 1940 Act requires every fund to have a
fundamental policy relating to concentration. This fundamental investment
restriction is being proposed to conform the Funds' restrictions to the 1940 Act
requirements.
Effect of Change on Funds and Shareholders. This change merely clarifies
the scope of the Funds' respective policies on concentration and will not change
the Funds' investment practices or increase risk to shareholders.
PROPOSAL 2.H. and 2.I. APPLY TO THE ICON CORE EQUITY FUND (formerly the
ICON Fund).
2.H. To Approve the Adoption of a Fundamental Policy with Respect to the
Investment Concentration of the ICON Core Equity Fund.
The Board recommends that shareholders vote to adopt the following
fundamental policy for the ICON Core Equity Fund.
The ICON Core Equity Fund may not purchase the securities of any issuer
(other than securities issued or guaranteed by the U.S. government or any
of its agencies or instrumentalities) if, as a result, more than 25% of
the Fund's total assets would be invested in the securities of companies
whose principal business activities are in the same industry.
Reasons for Changes. The 1940 Act requires every fund to have a
fundamental policy relating to concentration. This fundamental investment
restriction is being proposed to conform the Fund's restrictions to the 1940 Act
requirements.
20
Effect of Change on Fund and Shareholders. This change merely clarifies
the scope of the Fund's policy on concentration and will not change the Fund's
investment practices or increase risk to shareholders.
2.I. To Modify as to the ICON Core Equity Fund a Fundamental Policy on
Investing More than 5% of the Fund's Assets in the Securities of Any One
Issuer.
The fundamental policy currently applicable to the ICON Core Equity Fund
on investing more than 5% of a Fund's assets in the securities of any one issuer
is as follows:
No Fund may 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 Board recommends that shareholders vote to modify the policy set forth
above and replace it with the following:
With respect to 75% of the ICON Core Equity Fund's total assets, the Fund
may not purchase the securities of any issuer (other than the U.S.
government or any of its agencies or instrumentalities, or securities of
other investment companies) if, as a result, (a) more than 5% of the
Fund's total assets would be invested in the securities of that issuer, or
(b) the Fund would hold more than 10% of the voting securities of that
issuer.
Reasons for Change. The 1940 Act distinguishes funds that are
"diversified" and those that are "non-diversified." A diversified fund, among
other things, is prohibited from purchasing securities of any one issuer if, as
to 75% of the fund's total assets (compared to 50% for non-diversified funds),
more than 5% of the fund's total assets would be invested in securities of that
issuer at the time of purchase. This 5% limitation does not apply to securities
issued or guaranteed by the U.S. government, its agencies or instrumentalities.
The 1940 Act requires diversified funds to adopt a fundamental restriction
related to its diversification policies. The Trustees propose to amend the ICON
Core Equity Fund's diversification policy to specifically state that the Fund is
a diversified Fund.
Effect of Change on Funds and Shareholders. This change merely clarifies
the diversification status of the ICON Core Equity Fund and will not change the
Fund's investment practices.
REQUIRED VOTE
As to each Fund, approval of Proposals 2.A. through 2.I will require the
affirmative vote of a majority of the outstanding shares of that Fund voting
separately. Such a majority is defined in the 1940 Act as the lesser of: (a) 67%
or more of the shares present at the Meeting, if the holders of more than 50% of
the outstanding shares of the Fund are present or represented by proxy; or (b)
more than 50% of the total outstanding shares of that Fund.
21
THE BOARD RECOMMENDS THAT SHAREHOLDERS OF EACH FUND
VOTE "FOR" EACH SUB-SECTION OF PROPOSAL 2.
----------------------------
OTHER MATTERS
No business, other than as set forth above, is expected to come before the
Meeting. Should any other matters requiring a vote of shareholders properly come
before the Meeting, the persons named in the enclosed proxy will vote thereon in
accordance with their best judgment in the interests of ICON Funds.
SOLICITATION OF PROXIES
The solicitation of proxies, the cost of which will be borne by the Funds,
will be made primarily by mail but may also be made by telephone by Georgeson
Shareholder Communications, Inc., professional proxy solicitors, who will be
paid fees and expenses of approximately $40,441 for soliciting services. If
votes are recorded by telephone, Georgeson Shareholder Communications, Inc. will
use procedures designed to authenticate shareholders' identities, to allow
shareholders to authorize the voting of their shares in accordance with their
instructions and to confirm that shareholders instructions have been properly
recorded. Shareholders also may vote by mail or through a secure Internet site.
Proxies by telephone or Internet may be revoked at any time before they are
voted in the same manner that proxies voted by mail may be revoked.
THE FUNDS' ADVISER, DISTRIBUTOR, AND ADMINISTRATOR
Meridian Investment Management Corporation is located at 5299 DTC
Boulevard, Suite 1200, Greenwood Village, Colorado. The Adviser is a
wholly-owned subsidiary of Meridian Management and Research, Inc. ("MM&R"). The
Adviser serves as manager and investment advisor to each of the Funds pursuant
to an Investment Advisory Agreement.
Meridian Clearing Corporation, 5299 DTC Boulevard, Suite 1200, Greenwood
Village, Colorado, is a wholly owned subsidiary of MM&R and serves as each
Fund's distributor pursuant to underwriting agreements with each Fund and is
also compensated for its distribution and shareholder services pursuant to the
ICON Fund's Rule 12b-1 plan.
Meridian Investment Management Corporation also serves as administrator to
each Fund pursuant to a Management and Administration Agreement.
22
SHAREHOLDER PROPOSALS
As a general matter, ICON Funds does not hold regular annual or other
regular meetings of shareholders. Any shareholder who wishes to submit proposals
to be considered at a special meeting of ICON Funds' shareholders should send
such proposals to ICON Funds at 5299 DTC Boulevard, Greenwood Village, Colorado
80111. Proposals must be received a reasonable period of time prior to any
meeting to be included in the proxy materials or otherwise to be considered at
the meeting. Moreover, inclusion of such proposals is subject to limitations
under the federal securities laws. Persons named as proxies for any subsequent
shareholders meeting will vote in their discretion with respect to proposals
submitted on an untimely basis.
By order of the Board of Trustees,
/s/ Craig T. Callahan
------------------------------------------
Craig T. Callahan, President
/s/ Andra C. Ozols
------------------------------------------
Andra C. Ozols, Secretary
ICON Funds
Dated: September 25, 2002
23
[FORM OF PROXY CARD]
ICON FUNDS
VOTE TODAY BY MAIL, TOUCH-TONE PHONE OR THE INTERNET
CALL TOLL-FREE 1-800-690-6903
OR LOG ON TO WWW.PROXYWEB.COM
[NAME OF INDIVIDUAL FUND]
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES, WHICH RECOMMENDS A
VOTE "FOR" EACH PROPOSAL
The undersigned appoints Craig T. Callahan, Andra C. Ozols and Erik L. Jonson or
each of them separately with power to act without the others and with the right
of substitution in each, the proxies of the undersigned to vote, as designated
herein, all shares of the Fund named above (the "Fund") held by the undersigned
on September 10, 2002, at a Special Meeting of Shareholders of the Fund, to be
held at the offices of the ICON Funds, 5299 DTC Boulevard, Suite 1200, Greenwood
Village, Colorado 80111, on November 1, 2002 at 10:00 a.m. (Mountain time) and
at any adjournment thereof, with all powers the undersigned would possess if
present in person. All previous proxies given with respect to the meeting are
hereby revoked.
The undersigned hereby acknowledge(s) receipt of a copy of the accompanying
Notice of Special Meeting of Shareholders and the Proxy Statement with respect
thereto. This proxy may be revoked at any time before it is exercised.
- ---------------------------- -------------------------
Shareholder(s)signs here Date
PLEASE VOTE, DATE AND SIGN AND PROMPTLY RETURN THIS PROXY IN THE ENCLOSED
ENVELOPE.
Please sign exactly as name appears to the left. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such. If
signing for a corporation, please sign in full corporate name by authorized
person. If a partnership, please sign in partnership name by authorized person.
This proxy will be voted as instructed on the matters set forth below. If no
choice is specified, this proxy will be voted FOR all proposals. In their
discretion, the proxies are authorized to vote upon such other business as may
properly come before the meeting and any adjournments or postponements of the
meeting.
Please refer to your Proxy Statement for a complete discussion of the proposals
applicable to your Fund.
Please fill in box(es) as shown using black or blue ink or number 2 pencil.[X]
PLEASE DO NOT USE FINE POINT PENS.
Applies to All ICON Funds
1. To Elect Four Trustees to the Board of
Trustees. WITHHOLD FOR ALL
FOR ALL ALL EXCEPT*
(01) Glen F. Bergert, (02) John C. 1.
Pomeroy, Jr., (03) Gregory Kellam
Scott, (04) Jonathan F. Zeschin [ ] [ ] [ ]
* To withhold authority to vote for any
individual nominee mark the box "For
All Except" and write the nominee's
number on the line below.
Apply to All ICON Funds
FOR AGAINST ABSTAIN
2.A. To Modify a Fundamental Policy on
Issuing Senior Securities. [ ] [ ] [ ] 2.A.
2.B. To Modify a Fundamental Policy on
Borrowing. [ ] [ ] [ ] 2.B.
2.C. To Modify a Fundamental Policy on
Underwriting Securities. [ ] [ ] [ ] 2.C.
2.D. To Approve the Elimination of a
Fundamental Policy on Margin
Purchases and Adopt a Non-Fundamental
Policy on Margin Purchases. [ ] [ ] [ ] 2.D.
2.E. To Approve the Elimination of a
Fundamental Policy on Short Sales and
Adopt a Non-Fundamental Policy on
Short Sales. [ ] [ ] [ ] 2.E.
2.F. To Approve the Elimination of a
Fundamental Policy on Investing More
Than 5% of a Fund's Assets in the
Securities of Any One Issuer and the
Elimination of a Fundamental Policy
on Holding More Than 10% of the
Voting Securities of Any Issuer and
Adopt a Non-Fundamental Policy
Setting Forth the Diversification
Limits Required by the Internal
Revenue Code to Qualify as a
Regulated Investment Company. [ ] [ ] [ ] 2.F.
Applies to Each ICON Fund Other Than the
ICON Core Equity Fund (formerly the ICON
Fund)
2.G. To Approve the Adoption of a
Fundamental Policy With Respect to
the Investment Concentration of Each
Fund Other Than The ICON Core Equity
Fund. [ ] [ ] [ ] 2.G.
Apply to the ICON Core Equity Fund
(formerly the ICON Fund)
2.H. To Approve the Adoption of a
Fundamental Policy With Respect to
the Investment Concentration of the
ICON Core Equity Fund. [ ] [ ] [ ] 2.H.
2.I. To Modify as to the ICON Core Equity
Fund a Fundamental Policy on
Investing More than 5% of the Fund's
Assets in the Securities of Any One
Issuer. [ ] [ ] [ ] 2.I.
[BUCKSLIP FOR REGISTERED SHAREHOLDERS]
THREE CONVENIENT WAYS TO VOTE YOUR PROXY
The enclosed Proxy Statement details important issues affecting your ICON Funds
investment. Help us save time and postage costs - savings we pass along to you-
by voting online or by telephone. Each method is available 24 hours a day and
will ensure that your vote is confirmed and recorded immediately. You may, or
course, also vote by mail.
TO VOTE ONLINE:
1. Read the Proxy Statement and have your proxy card(s)at hand.
2. Go to www.proxyweb.com.
3. Enter the 12-digit Control Number from your proxy card(s).
4. Follow the simple instructions.
TO VOTE BY TELEPHONE:
1. Read the Proxy Statement and have your proxy card(s)at hand.
2. Call toll-free 1-800-690-6903.
3. Enter the 12-digit Control Number from your proxy card(s).
4. Follow the simple recorded instructions.
TO VOTE BY MAIL:
1. Read the Proxy Statement.
2. Simply mark, sign, and date the enclosed proxy card(s)
3. Mail the proxy card(s) in the postage-paid envelope provided.
There is no need to mail the proxy card if you are voting by Internet or
telephone.
REMEMBER YOUR VOTE COUNTS. VOTE TODAY!
[LOGO]
[BUCKSLIP FOR BENEFICIAL SHAREHOLDERS]
THREE CONVENIENT WAYS TO VOTE YOUR PROXY
The enclosed Proxy Statement details important issues affecting your ICON Funds
investment. Help us save time and postage costs - savings we pass along to you-
by voting online or by telephone. Each method is available 24 hours a day and
will ensure that your vote is confirmed and recorded immediately. You may, or
course, also vote by mail.
TO VOTE ONLINE:
1. Read the Proxy Statement and have your proxy card(s)at hand.
2. Go to www.proxyvote.com.
3. Enter the 12-digit Control Number from your proxy card(s).
4. Follow the simple instructions.
TO VOTE BY TELEPHONE:
1. Read the Proxy Statement and have your proxy card(s)at hand.
2. Call toll-free 1-800-454-8683.
3. Enter the 12-digit Control Number from your proxy card(s).
4. Follow the simple recorded instructions.
TO VOTE BY MAIL:
1. Read the Proxy Statement.
2. Simply mark, sign, and date the enclosed proxy card(s)
3. Mail the proxy card(s) in the postage-paid envelope provided.
There is no need to mail the proxy card if you are voting by Internet or
telephone.
REMEMBER YOUR VOTE COUNTS. VOTE TODAY!
[LOGO]