FORM OF
SUBADVISORY AGREEMENT
THIS AGREEMENT is made and entered into [ as of the ] ______ day of
_________, 2005, by and among GARTMORE MUTUAL FUNDS, a Delaware statutory trust
(the "Trust"), GARTMORE GLOBAL ASSET MANAGEMENT TRUST (the "Adviser") a Delaware
business trust registered under the Investment Advisers Act of 1940, as amended
(the "Advisers Act"), and GARTMORE GLOBAL PARTNERS, a _______________ under the
laws of the State of ________ (the "Subadviser"), and also registered under the
Advisers Act.
WITNESSETH:
WHEREAS, the Trust is registered with the U.S. Securities and Exchange
Commission (the "SEC") as an open-end management investment company under the
Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Adviser has, pursuant to an Investment Advisory Agreement
with the Trust dated [ as of ] the ____ day of _________, 2005 (the "Advisory
Agreement"), been retained to act as investment adviser for certain of the
series of the Trust that are listed on Exhibit A to this Agreement (each, a
"Fund");
WHEREAS, the Adviser represents that it is willing and possesses legal
authority to render such services subject to the terms and conditions set forth
in this Agreement;
WHEREAS, the Trust and the Adviser each represent that the Advisory
Agreement permits the Adviser to delegate certain of its duties under the
Advisory Agreement to other investment advisers, subject to the requirements of
the 1940 Act; and
WHEREAS, the Adviser desires to retain Subadviser to assist it in the
provision of a continuous investment program for that portion of the Fund's
assets that the Adviser will assign to the Subadviser, and Subadviser is willing
to render such services subject to the terms and conditions set forth in this
Agreement,
NOW, THEREFORE, the parties do mutually agree and promise as follows
with respect to each Fund:
1. Appointment as Subadviser. The Adviser hereby appoints the Subadviser
to act as investment adviser for and to manage that portion or all of the assets
of the Fund that the Adviser from time to time upon reasonable prior notice
allocates to, and puts under the control of, the Subadviser (the "Subadviser
Assets") subject to the supervision of the Adviser and the Board of Trustees of
the Trust and subject to the terms of this Agreement; and the Subadviser hereby
accepts such appointment. In such capacity, the Subadviser shall be responsible
for the investment management of the Subadviser Assets. It is recognized that
the Subadviser and certain of its affiliates now act, and that from time to time
hereafter may act, as investment adviser to one or more other investment
companies and to fiduciary or other managed accounts and that the Adviser and
the Trust cannot object to such activities.
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2. Duties of Subadviser.
(a) Investments. The Subadviser is hereby authorized and
directed and hereby agrees, subject to the stated investment policies
and restrictions of the Fund as set forth in the Fund's prospectus and
statement of additional information as currently in effect and, as soon
as practical after the Trust, the Fund or the Adviser notifies the
Subadviser thereof, as supplemented or amended from time to time
(collectively referred to hereinafter as the "Prospectus") and subject
to the directions of the Adviser and the Trust's Board of Trustees, to
monitor on a continuous basis the performance of the Subadviser Assets
and to conduct a continuous program of investment, evaluation and, if
appropriate, sale and reinvestment of the Subadviser Assets. The Adviser
agrees to provide the Subadviser with such assistance as may be
reasonably requested by the Subadviser in connection with the
Subadviser's activities under this Agreement, including, without
limitation, providing information concerning the Fund, its funds
available, or to become available, for investment and generally as to
the conditions of the Fund's or the Trust's affairs.
(b) Compliance with Applicable Laws and Governing Documents. In
the performance of its services under this Agreement, the Subadviser
shall act in conformity with the Prospectus and the Trust's Agreement
and Declaration of Trust and By-Laws as currently in effect and, as soon
as practical after the Trust, the Fund or the Adviser notifies the
Subadviser thereof, as supplemented, amended and/or restated from time
to time (referred to hereinafter as the "Declaration of Trust" and
"By-Laws," respectively) and with the instructions and directions
received in writing from the Adviser or the Trustees of the Trust and
will conform to, and comply with, the requirements of the 1940 Act, the
Internal Revenue Code of 1986, as amended (the "Code"), and all other
applicable federal and state laws and regulations. Without limiting the
preceding sentence, the Adviser promptly shall notify the Subadviser as
to any act or omission of the Subadviser hereunder that the Adviser
reasonably deems to constitute or to be the basis of any noncompliance
or nonconformance with any of the Trust's Declaration of Trust and
By-Laws and the Prospectus, the instructions and directions received in
writing from the Adviser or the Trustees of the Trust or the 1940 Act,
the Code, and all other applicable federal and state laws and
regulations. Notwithstanding the foregoing, the Adviser shall remain
responsible for ensuring the Fund's and the Trust's overall compliance
with the 1940 Act, the Code and all other applicable federal and state
laws and regulations and the Subadviser is only obligated to comply with
this subsection (b) with respect to the Subadviser Assets. The Adviser
timely will provide the Subadviser with a copy of the minutes of the
meetings of the Board of Trustees of the Trust to the extent they may
affect a Fund or the services of the Subadviser, copies of any financial
statements or reports made by a Fund to its shareholders, and any
further materials or information which the Subadviser may reasonably
request to enable it to perform its functions under this Agreement.
The Adviser shall perform quarterly and annual tax compliance
tests to ensure that the Fund is in compliance with Subchapter M and
Section 817(h) of the Code. In connection with such compliance tests,
the Adviser shall inform the Subadviser at least ten (10) business days
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prior to a calendar quarter end if the Subadviser Assets are out of
compliance with the diversification requirements under either Subchapter
M or Section 817(h). If the Adviser notifies the Subadviser that the
Subadviser Assets are not in compliance with such requirements noted
above, the Subadviser will take prompt action to bring the Subadviser
Assets back into compliance within the time permitted under the Code
thereunder.
The Adviser will provide the Subadviser with reasonable advance
notice of any change in a Fund's investment objectives, policies and
restrictions as stated in the Prospectus, and the Subadviser shall, in
the performance of its duties and obligations under this Agreement,
manage the Subadviser Assets consistent with such changes, provided that
the Subadviser has received prompt notice of the effectiveness of such
changes from the Trust or the Adviser. In addition to such notice, the
Adviser shall provide to the Subadviser a copy of a modified Prospectus
reflecting such changes. The Adviser acknowledges and will ensure that
the Prospectus will at all times be in compliance with all disclosure
requirements under all applicable federal and state laws and regulations
relating to the Trust or the Fund, including, without limitation, the
1940 Act, and the rules and regulations thereunder, and that the
Subadviser shall have no liability in connection therewith, except as to
the accuracy of material information furnished in writing by the
Subadviser to the Trust or to the Adviser specifically for inclusion in
the Prospectus. The Subadviser hereby agrees to provide to the Adviser
in a timely manner such information relating to the Subadviser and its
relationship to, and actions for, the Trust as may be required to be
contained in the Prospectus or in the Trust's Registration Statement on
Form N-1A.
(c) Voting of Proxies. The Adviser hereby delegates to the
Subadviser the Adviser's discretionary authority to exercise voting
rights with respect to the securities and other investments in the
Subadviser Assets and authorizes the Subadviser to delegate further such
discretionary authority to a designee identified in a notice given to
the Trust and the Adviser. The Subadviser, including without limitation
its designee, shall have the power to vote, either in person or by
proxy, all securities in which the Subadviser Assets may be invested
from time to time, and shall not be required to seek or take
instructions from, the Adviser, the Fund or the Trust or take any action
with respect thereto. If both the Subadviser and another entity managing
assets of the Fund have invested the Fund's assets in the same security,
the Subadviser and such other entity will each have the power to vote
its pro rata share of the Fund's security.
The Subadviser will establish a written procedure for proxy
voting in compliance with current applicable rules and regulations,
including but not limited to Rule 30b1-4 under the 1940 Act. The
Subadviser will provide the Adviser or its designee, a copy of such
procedure and establish a process for the timely distribution of the
Subadviser's voting record with respect to the Fund's securities and
other information necessary for the Fund to complete information
required by Form N-1A under the 1940 Act and the Securities Act of 1933,
as amended (the "Securities Act"), Form N-PX under the 1940 Act, and
Form N-CSR under the Xxxxxxxx-Xxxxx Act of 2002, as amended,
respectively.
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(d) Agent. Subject to any other written instructions of the
Adviser or the Trust, the Subadviser is hereby appointed the Adviser's
and the Trust's agent and attorney-infact for the limited purposes of
executing account documentation, agreements, contracts and other
documents as the Subadviser shall be requested by brokers, dealers,
counterparties and other persons in connection with its management of
the Subadviser Assets. The Subadviser agrees to provide the Adviser and
the Trust with copies of any such agreements executed on behalf of the
Adviser or the Trust.
(e) Brokerage. The Subadviser is authorized, subject to the
supervision of the Adviser and the plenary authority of the Trust's
Board of Trustees, to establish and maintain accounts on behalf of the
Fund with, and place orders for the investment and reinvestment,
including without limitation purchase and sale of the Subadviser Assets
with or through, such persons, brokers (including, to the extent
permitted by applicable law, any broker affiliated with the Subadviser)
or dealers (collectively "Brokers") as Subadviser may elect and
negotiate commissions to be paid on such transactions. The Subadviser,
however, is not required to obtain the consent of the Adviser or the
Trust's Board of Trustees prior to establishing any such brokerage
account. The Subadviser shall place all orders for the purchase and sale
of portfolio investments for a Fund's account with Brokers selected by
the Subadviser. In the selection of such Brokers and the placing of such
orders, the Subadviser shall seek to obtain for the Fund the most
favorable price and execution available, except to the extent it may be
permitted to pay higher brokerage commissions for brokerage and research
services, as provided below. In using its reasonable efforts to obtain
for a Fund the most favorable price and execution available, the
Subadviser, bearing in mind the best interests of each Fund at all
times, shall consider all factors it deems relevant, including price,
the size of the transaction, the breadth and nature of the market for
the security, the difficulty of the execution, the amount of the
commission, if any, the timing of the transaction, market prices and
trends, the reputation, experience and financial stability of the Broker
involved, and the quality of service rendered by the Broker in other
transactions. Notwithstanding the foregoing, neither the Trust, the Fund
nor the Adviser shall instruct the Subadviser to place orders with any
particular Broker(s) with respect to the Subadviser Assets. Subject to
such policies as the Trustees may determine, or as may be mutually
agreed to by the Adviser and the Subadviser, the Subadviser is
authorized but not obligated to cause, and shall not be deemed to have
acted unlawfully or to have breached any duty created by this Agreement
or otherwise solely by reason of its having caused, the Fund to pay a
Broker that provides brokerage and research services (within the meaning
of Section 28(e) of the Securities Exchange Act of 1934) to the
Subadviser an amount of commission for effecting a Subadviser Assets
investment transaction that is in excess of the amount of commission
that another Broker would have charged for effecting that transaction
if, but only if, the Subadviser determines in good faith that such
commission was reasonable in relation to the value of the brokerage and
research services provided by such Broker viewed in terms of either that
particular transaction or the overall responsibility of the Subadviser
with respect to the accounts as to which it exercises investment
discretion.
It is recognized that the services provided by such Brokers may
be useful to the Subadviser in connection with the Subadviser's services
to other clients. On occasions when the Subadviser deems the purchase or
sale of a security to be in the best interests of the Fund with respect
to the Subadviser Assets as well as other clients of the Subadviser, the
Subadviser, to the extent permitted by applicable laws and regulations,
may, but shall be under no obligation to, aggregate the securities to be
sold or purchased in order to obtain the most favorable price or lower
brokerage commissions and efficient execution. In such event, allocation
of securities so sold or purchased, as well as the expenses incurred in
the transaction, will be made by the Subadviser in the manner the
Subadviser considers to be the most equitable and consistent with its
fiduciary obligations to each Fund and to such other clients. It is
recognized that in some cases, this procedure may adversely affect the
price paid or received by the Fund or the size of the position
obtainable for, or disposed of by, the Fund with respect to the
Subadviser Assets.
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(f) Securities Transactions. The Subadviser and any affiliated
person of the Subadviser will not purchase securities or other
instruments from or sell securities or other instruments to the Fund;
provided, however, the Subadviser or any affiliated person of the
Subadviser may purchase securities or other instruments from or sell
securities or other instruments to the Fund if such transaction is
permissible under applicable laws and regulations, including, without
limitation, the 1940 Act and the Advisers Act and the rules and
regulations promulgated thereunder.
The Subadviser, on its own behalf and with respect to its
Access Persons (as defined in subsection (e) of Rule 17j-1 under the
1940 Act), agrees to observe and comply with Rule 17j-1 and its Code of
Ethics (which shall comply in all material respects with Rule 17j-1), as
the same may be amended from time to time. On at least an annual basis,
the Subadviser will comply with the reporting requirements of Rule
17j-1, which may include either (i) certifying to the Adviser that the
Subadviser and its Access Persons have complied with the Subadviser's
Code of Ethics with respect to the Subadviser Assets or (ii) identifying
any violations which have occurred with respect to the Subadviser
Assets. The Subadviser will have also submitted its Code of Ethics for
its initial approval by the Board of Trustees no later than the date of
execution of this agreement and subsequently within six months of any
material change thereto.
(g) Books and Records. The Subadviser shall maintain separate
detailed records as are required by applicable laws and regulations of
all matters hereunder pertaining to the Subadviser Assets (the "Fund's
Records"), including, without limitation, brokerage and other records of
all securities transactions. The Subadviser acknowledges that the Fund's
Records are property of the Trust; except to the extent that the
Subadviser is required to maintain the Fund's Records under the Advisers
Act or other applicable law and except that the Subadviser, at its own
expense, is entitled to make and keep a copy of the Fund's Records for
its internal files. The Fund's Records shall be available to the Adviser
or the Trust at any time upon reasonable request during normal business
hours and shall be available for telecopying promptly to the Adviser
during any day that the Fund is open for business as set forth in the
Prospectus.
(h) Information Concerning Subadviser Assets and Subadviser.
From time to time as the Adviser or the Trust reasonably may request in
good faith, the Subadviser will furnish the requesting party reports on
portfolio transactions and reports on the Subadviser Assets, all in such
reasonable detail as the parties may reasonably agree in good faith. The
Subadviser will also inform the Adviser in a timely manner of material
changes in portfolio managers responsible for Subadviser Assets, any
changes in the ownership or management of the Subadviser, or of material
changes in the control of the Subadviser. Upon the Trust's or the
Adviser's reasonable request, the Subadviser will make available its
officers and employees to meet with the Trust's Board of Trustees to
review the Subadviser Assets via telephone on a quarterly basis and on a
less frequent basis as agreed upon by the parties in person.
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Subject to the other provisions of this Agreement, the
Subadviser will also provide such information or perform such
additional acts with respect to the Subadviser Assets as are reasonably
required for the Trust or the Adviser to comply with their respective
obligations under applicable laws, including without limitation, the
Code, the 1940 Act, the Advisers Act, and the Securities Act, and any
rule or regulation thereunder.
(i) Custody Arrangements. The Trust or the Adviser shall notify
the Subadviser of the identities of its custodian banks and the custody
arrangements therewith with respect to the Subadviser Assets and shall
give the Subadviser written notice of any changes in such custodian
banks or custody arrangements. The Subadviser shall on each business day
provide the Adviser and the Trust's custodian such information as the
Adviser and the Trust's custodian may reasonably request in good faith
relating to all transactions concerning the Subadviser Assets. The Trust
shall instruct its custodian banks to (A) carry out all investment
instructions as may be directed by the Subadviser with respect to the
Subadviser Assets (which instructions may be orally given if confirmed
in writing); and (B) provide the Subadviser with all operational
information necessary for the Subadviser to trade the Subadviser Assets
on behalf of the Fund. The Subadviser shall have no liability for the
acts or omissions of the authorized custodian(s), unless such act or
omission is required by and taken in reliance upon instructions given to
the authorized custodian(s) by a representative of the Subadviser
properly authorized (pursuant to written instruction by the Adviser) to
give such instructions.
3. Independent Contractor. In the performance of its services
hereunder, the Subadviser is and shall be an independent contractor and unless
otherwise expressly provided herein or otherwise authorized in writing, shall
have no authority to act for or represent the Fund, the Trust or the Adviser in
any way or otherwise be deemed an agent of the Fund, the Trust or the Adviser.
4. Expenses. During the term of this Agreement, Subadviser will
pay all expenses incurred by it in connection with its activities under this
Agreement. The Subadviser shall, at its sole expense, employ or associate itself
with such persons as it believes to be particularly fitted to assist it in the
execution of its duties under this Agreement. The Subadviser shall not be
responsible for the Trust's, the Fund's or Adviser's expenses, which shall
include, but not be limited to, the cost of securities, commodities and other
investments (including brokerage commissions and other transaction charges, if
any) purchased for a Fund and any losses incurred in connection therewith,
expenses of holding or carrying Subadviser Assets, including, without
limitation, expenses of dividends on stock borrowed to cover a short sale and
interest, fees or other charges incurred in connection with leverage and related
borrowings with respect to the Subadviser Assets, organizational and offering
expenses (which include, but are not limited to, out-of-pocket expenses, but not
overhead or employee costs of the Subadviser); expenses for legal, accounting
and auditing services; taxes and governmental fees; dues and expenses incurred
in connection with membership in investment company organizations; costs of
printing and distributing shareholder reports, proxy materials, prospectuses,
stock certificates and distribution of dividends; charges of the Fund's
custodians and sub-custodians, administrators and sub-administrators,
registrars, transfer agents, dividend disbursing agents and dividend
reinvestment plan agents; payment for portfolio pricing services to a pricing
agent, if any; registration and filing fees of the SEC; expenses of registering
or qualifying securities of the Fund for sale in the various states; freight and
other charges in connection with the shipment of the Fund's portfolio
securities; fees and expenses of non-interested Trustees; salaries of
shareholder relations personnel; costs of shareholders meetings; insurance;
interest; brokerage costs; and litigation and other extraordinary or
non-recurring expenses. The Trust or the Adviser, as the case may be, shall
reimburse the Subadviser for any expenses of the Funds or the Adviser as may be
reasonably incurred by such Subadviser on behalf of the Fund or the Adviser. The
Subadviser shall keep and supply to the Trust and the Adviser reasonable records
of all such expenses.
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5. Compensation. For the services provided pursuant to this
Agreement, the Subadviser is entitled to the fee listed for the Fund on Exhibit
A hereto. Such fees will be computed daily and paid no later than the seventh
(7th) business day following the end of each month, from the Adviser or the
Trust, calculated at an annual rate based on the Subadviser Assets' average
daily net assets.
The method of determining the net asset value of the Subadviser Assets
for purposes hereof shall be the same as the method of determining net asset
value for purposes of establishing the offering and redemption price of the
shares of the Trust as described in the Fund's Prospectus. If this Agreement
shall be effective for only a portion of a month with respect to the Fund, the
aforesaid fee shall be prorated for the portion of such month during which this
Agreement is in effect for the Fund.
6. Representations and Warranties of Subadviser. The Subadviser
represents and warrants to the Adviser and the Trust as follows:
(a) The Subadviser is registered as an investment adviser under
the Advisers
(b) The Subadviser is registered as a Commodity Trading Advisor
under the Commodity Exchange Act, as amended (the "CEA"), with the
Commodity Futures Trading Commission (the "CFTC"), or is not required to
file such registration;
(c) The Subadviser is a corporation duly organized and properly
registered and operating under the laws of the State of Illinois with
the power to own and possess its assets and carry on its business as it
is now being conducted and as proposed to be conducted hereunder;
(d) The execution, delivery and performance by the Subadviser
of this Agreement are within the Subadviser's powers and have been duly
authorized by all necessary actions of its directors or shareholders,
and no action by, or in respect of, or filing with, any governmental
body, agency or official is required on the part of the Subadviser for
execution, delivery and performance by the Subadviser of this Agreement,
and the execution, delivery and performance by the Subadviser of this
Agreement do not contravene or constitute a violation of, or a material
default under, (i) any provision of applicable law, rule or regulation,
(ii) the Subadviser's governing instruments, or (iii) any agreement,
judgment, injunction, order, decree or other instrument binding upon the
Subadviser; and
(e) The Form ADV of the Subadviser previously provided to the
Adviser and the Trust is a true and complete copy of the form, including
that part or parts of the Form ADV filed with the SEC, that part or
parts maintained in the records of the Adviser, and/or that part or
parts provided or offered to clients, in each case as required under the
Advisers Act and rules thereunder, and the information contained therein
is accurate and complete in all material respects and does not omit to
state any material fact necessary in order to make the statements made,
in light of the circumstances under which they were made, not
misleading.
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7. Representations and Warranties of Adviser. The Adviser represents and
warrants to the Subadviser as follows:
(a) The Adviser is registered as an investment adviser under
the Advisers Act;
(b) The Adviser has filed a notice of exemption pursuant to
Rule 4.14 under the CEA with the CFTC and the National Futures
Association or is not required to file such exemption;
(c) The Adviser is a business trust duly organized and validly
existing under the laws of the State of Delaware with the power to own
and possess its assets and carry on its business as it is now being
conducted and as proposed to be conducted hereunder;
(d) The execution, delivery and performance by the Adviser of
this Agreement are within the Adviser's powers and have been duly
authorized by all necessary action on the part of its directors,
shareholders or managing unitholder, and no action by, or in respect of,
or filing with, any governmental body, agency or official is required on
the part of the Adviser for the execution, delivery and performance by
the Adviser of this Agreement, and the execution, delivery and
performance by the Adviser of this Agreement do not contravene or
constitute a violation of, or a material default under, (i) any
provision of applicable law, rule or regulation, (ii) the Adviser's
governing instruments, or (iii) any agreement, judgment, injunction,
order, decree or other instrument binding upon the Adviser;
(e) The Form ADV of the Adviser previously provided to the
Subadviser and the Trust is a true and complete copy of the form,
including that part or parts of the Form ADV filed with the SEC, that
part or parts maintained in the records of the Adviser, and/or that part
or parts provided or offered to clients, in each case as required under
the Advisers Act and rules thereunder, and the information contained
therein is accurate and complete in all material respects and does not
omit to state any material fact necessary in order to make the
statements made, in light of the circumstances under which they were
made, not misleading;
(f) The Adviser acknowledges that it received a copy of the
Subadviser's Form ADV prior to the execution of this Agreement; and
(g) The Adviser and the Trust have duly entered into the
Advisory Agreement pursuant to which the Trust authorized the Adviser to
delegate certain of its duties under the Advisory Agreement to other
investment advisers, including without limitation, the appointment of a
subadviser with respect to assets of each of the Trust's mutual fund
series, including without limitation the Adviser's entering into and
performing this Agreement.
8. Representations and Warranties of the Trust. The Trust
represents and warrants to the Adviser and the Subadviser as follows:
(a) The Trust is a statutory trust duly formed and validly
existing under the laws of the State of Delaware with the power to own
and possess its assets and carry on its business as it is now being
conducted and as proposed to be conducted hereunder;
(b) The Trust is registered as an investment company under the
1940 Act and has elected to qualify and has qualified, together with the
Fund, as a regulated investment company under the Code, and the Fund's
shares are registered under the Securities Act;
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(c) The execution, delivery and performance by the Trust of
this Agreement are within the Trust's powers and have been duly
authorized by all necessary action on the part of the Trust and its
Board of Trustees, and no action by, or in respect of, or filing with,
any governmental body, agency or official is required on the part of the
Trust for the execution, delivery and performance by the Adviser of this
Agreement, and the execution, delivery and performance by the Trust of
this Agreement do not contravene or constitute a default under (i) any
provision of applicable law, rule or regulation, (ii) the Trust's
governing instruments, or (iii) any agreement, judgment, injunction,
order, decree or other instrument binding upon the Trust; and
(d) The Trust acknowledges that it received a copy of the
Subadviser's Form ADV prior to the execution of this Agreement.
9. Survival of Representations and Warranties; Duty to Update
Information. All representations and warranties made by the Subadviser, the
Adviser and the Trust pursuant to the recitals above and Sections 6, 7 and 8,
respectively, shall survive for the duration of this Agreement and the parties
hereto shall promptly notify each other in writing upon becoming aware that any
of the foregoing representations and warranties are no longer true or accurate
in all material effects.
10. Liability and Indemnification.
(a) Liability. The Subadviser shall exercise its best judgment
in rendering its services in accordance with the terms of this
Agreement, but otherwise, in the absence of willful misfeasance, bad
faith or gross negligence on the part of the Subadviser or a reckless
disregard of its duties hereunder, the Subadviser, each of its
affiliates and all respective partners, officers, directors and
employees ("Affiliates") and each person, if any, who within the meaning
of the Securities Act controls the Subadviser ("Controlling Persons"),
if any, shall not be subject to any expenses or liability to the
Adviser, any other subadviser to a Fund, the Trust or a Fund or any of a
Fund's shareholders, in connection with the matters to which this
Agreement relates, including without limitation for any losses that may
be sustained in the purchase, holding or sale of Subadviser Assets. The
Adviser shall exercise its best judgment in rendering its obligations in
accordance with the terms of this Agreement, but otherwise (except as
set forth in Section 10(c) below), in the absence of willful
misfeasance, bad faith or gross negligence on the part of the Adviser or
a reckless disregard of its duties hereunder, the Adviser, any of its
Affiliates and each of the Adviser's Controlling Persons, if any, shall
not be subject to any liability to the Subadviser, for any act or
omission in the case of, or connected with, rendering services hereunder
or for any losses that may be sustained in the purchase, holding or sale
of Subadviser Assets. Notwithstanding the foregoing, nothing herein
shall relieve the Adviser and the Subadviser from any of their
obligations under applicable law, including, without limitation, the
federal and state securities laws and the CEA.
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(b) Indemnification. The Subadviser shall indemnify the
Adviser, the Trust and the Fund, and their respective Affiliates and
Controlling Persons for any liability and expenses, including without
limitation reasonable attorneys' fees and expenses, which the Adviser,
the Trust and/or the Fund and their respective Affiliates and
Controlling Persons may sustain as a result of the Subadviser's willful
misfeasance, bad faith, gross negligence, reckless disregard of its
duties hereunder or violation of applicable law, including, without
limitation, the federal and state securities laws or the CEA. The
Adviser shall indemnify the Subadviser, its Affiliates and its
Controlling Persons, for any liability and expenses, including without
limitation reasonable attorneys' fees and expenses, which may be
sustained as a result of the Adviser's willful misfeasance, bad faith,
gross negligence, reckless disregard of its duties hereunder or
violation of applicable law, including, without limitation, the federal
and state securities laws or the CEA.
The Trust shall indemnify the Subadviser, its Affiliates and
its Controlling Persons, for any liability and expenses, including
without limitation reasonable attorneys' fees and expenses, which may be
sustained as a result of the Trust's willful misfeasance, bad faith,
gross negligence, reckless disregard of its duties hereunder or
violation of applicable law, including, without limitation, the federal
and state securities laws or the CEA.
(c) The Subadviser shall not be liable to the Adviser for (i)
any acts of the Adviser or any other subadviser to a Fund with respect
to the portion of the assets of that Fund not managed by Subadviser, or
(ii) acts of the Subadviser which result from acts of the Adviser,
including, but not limited to, a failure of the Adviser to provide
accurate and current information with respect to any records maintained
by the Adviser or any other subadviser to a Fund, which records are not
also maintained by or otherwise available to the Subadviser upon
reasonable request. The Adviser agrees that Subadviser shall manage the
Subadviser Assets as if they were a separate operating Fund as set forth
in Section 2(b) of this Agreement. The Adviser shall indemnify the
Subadviser, its Affiliates and Controlling Persons from any liability
arising from the conduct of the Adviser and any other subadviser with
respect to the portion of the Fund's assets not allocated to the
Subadviser.
11. Duration and Termination.
(a) Duration. Unless sooner terminated, this Agreement shall
continue until [ January 1, 2006 ], with respect to any Fund covered by
the Agreement initially and for an initial two-year period for any Fund
subsequently added to the Agreement, and thereafter shall continue
automatically for successive annual periods with respect to each such
Fund, provided such continuance is specifically approved at least
annually by the Trust's Board of Trustees or vote of the lesser of (a)
67% of the shares of the Fund represented at a meeting if holders of
more than 50% of the outstanding shares of the Fund are present in
person or by proxy or (b) more than 50% of the outstanding shares of the
Fund; provided that in either event its continuance also is approved by
a majority of the Trust's Trustees who are not "interested persons" (as
defined in the 0000 Xxx) of any party to this Agreement, by vote cast in
person at a meeting called for the purpose of voting on such approval.
(b) Termination. Notwithstanding whatever may be provided
herein to the contrary, this Agreement may be terminated at any time
with respect to the Fund, without payment of any penalty:
(i) By vote of a majority of the Trust's Board of Trustees,
or by "vote of a majority of the outstanding voting securities"
of the Fund (as defined in the 1940 Act), or by the Adviser, in
each case, upon not more than 60 days' written notice to the
Subadviser;
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(ii) By any party hereto immediately upon written notice to
the other parties in the event of a breach of any provision of
this Agreement by either of the other parties; or
(iii) By the Subadviser upon not more than 60 days' written
notice to the Adviser and the Trust.
This Agreement shall not be assigned (as such term is defined in the
0000 Xxx) and shall terminate automatically in the event of its
assignment or upon the termination of the Advisory Agreement.
12. Duties of the Adviser. The Adviser shall continue to have
responsibility for all services to be provided to the Fund pursuant to the
Advisory Agreement and shall oversee and review the Subadviser's performance of
its duties under this Agreement. Nothing contained in this Agreement shall
obligate the Adviser to provide any funding or other support for the purpose of
directly or indirectly promoting investments in the Fund.
13. Reference to Adviser and Subadviser.
(a) Neither the Adviser nor any Affiliate or agent of the
Adviser shall make reference to or use the name of Subadviser or any of
its Affiliates, or any of their clients, except references concerning
the identity of and services provided by the Subadviser to a Fund, which
references shall not differ in substance from those included in the
Prospectus and this Agreement, in any advertising or promotional
materials without the prior approval of Subadviser, which approval shall
not be unreasonably withheld or delayed. The Adviser hereby agrees to
make all reasonable efforts to cause the Fund and any Affiliate thereof
to satisfy the foregoing obligation.
(b) Neither the Subadviser nor any Affiliate or agent of it
shall make reference to or use the name of the Adviser or any of its
Affiliates, or any of their clients, except references concerning the
identity of and services provided by the Adviser to a Fund or to the
Subadviser, which references shall not differ in substance from those
included in the Prospectus and this Agreement, in any advertising or
promotional materials without the prior approval of Adviser, which
approval shall not be unreasonably withheld or delayed. The Subadviser
hereby agrees to make all reasonable efforts to cause any Affiliate of
the Subadviser to satisfy the foregoing obligation.
14. Amendment. This Agreement may be amended by mutual consent of the
parties, provided that the terms of any material amendment shall be approved by:
(a) the Trust's Board of Trustees or by a vote of a majority of the outstanding
voting securities of the Funds (as required by the 1940 Act), and (b) the vote
of a majority of those Trustees of the Trust who are not "interested persons" of
any party to this Agreement cast in person at a meeting called for the purpose
of voting on such approval, if such approval is required by applicable law.
15. Confidentiality. Subject to the duties of the Adviser, the Trust
and the Subadviser to comply with applicable law, including any demand of any
regulatory or taxing authority having jurisdiction, the parties hereto shall
treat as confidential and shall not disclose any and all information pertaining
to the Fund and the actions of the Subadviser, the Adviser and the Fund in
respect thereof; except to the extent:
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(a) Authorized. The Adviser or the Trust has authorized such
disclosure;
(b) Court or Regulatory Authority. Disclosure of such
information is expressly required or requested by a court or other
tribunal of competent jurisdiction or applicable federal or state
regulatory authorities;
(c) Publicly Known Without Breach. Such information becomes
known to the general public without a breach of this Agreement or a
similar confidential disclosure agreement regarding such information;
(d) Already Known. Such information already was known by the
party prior to the date hereof;
(e) Received From Third Party. Such information was or is
hereafter rightfully received by the party from a third party (expressly
excluding the Fund's custodian, prime broker and administrator) without
restriction on its disclosure and without breach of this Agreement or of
a similar confidential disclosure agreement regarding them; or
(f) Independently Developed. The party independently developed
such information.
16. Notice. Any notice that is required to be given by the parties
to each other under the terms of this Agreement shall be in writing, delivered,
or mailed postpaid to the other parties, or transmitted by facsimile with
acknowledgment of receipt, to the parties at the following addresses or
facsimile numbers, which may from time to time be changed by the parties by
notice to the other party:
(a) If to the Subadviser:
Gartmore Global Partners
(b) If to the Adviser:
Gartmore Global Asset Management Trust
0000 Xxxxx Xxxx
Xxxxxxxxxxxx, XX, 00000
Attention: Legal Department
Facsimile: (000) 000-0000
(c) If to the Trust:
Gartmore Mutual Funds
0000 Xxxxx Xxxx
Xxxxxxxxxxxx, XX 00000
Attention: Legal Department
Facsimile: (000) 000-0000
17. Jurisdiction. This Agreement shall be governed by and construed in
accordance with substantive laws of the State of Delaware without reference to
choice of law principles thereof and in accordance with the 1940 Act. In the
case of any conflict, the 1940 Act shall control.
-12-
18. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, all of which shall
together constitute one and the same instrument.
19. Certain Definitions. For the purposes of this Agreement and except
as otherwise provided herein, "interested person," "affiliated person," and
"assignment" shall have their respective meanings as set forth in the 1940 Act,
subject, however, to such exemptions as may be granted by the SEC.
20. Captions. The captions herein are included for convenience of
reference only and shall be ignored in the construction or interpretation
hereof.
21. Severability. If any provision of this Agreement shall be held or
made invalid by a court decision or applicable law, the remainder of the
Agreement shall not be affected adversely and shall remain in full force and
effect.
22. Entire Agreement. This Agreement, together with all exhibits,
attachments and appendices, contains the entire understanding and agreement of
the parties with respect to the subject matter hereof.
23. Gartmore Mutual Funds and its Trustees. The terms "Gartmore Mutual
Funds" and the "Trustees of Gartmore Mutual Funds" refer respectively to the
Trust created and the Trustees, as trustees but not individually or personally,
acting from time to time under the Declaration of Trust made and dated as of
September 30, 2004, as has been or may be amended and/or restated from time to
time, and to which reference is hereby made.
[The remainder of this page is intentionally left blank.]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first written above.
TRUST
GARTMORE MUTUAL FUNDS
By:______________________________________
Name:
Title:
ADVISER
GARTMORE GLOBAL ASSET MANAGEMENT TRUST
By:______________________________________
Name:
Title:
SUBADVISER
GARTMORE GLOBAL PARTNERS
By:______________________________________
Name:
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EXHIBIT A
SUBADVISORY AGREEMENT
BETWEEN
GARTMORE GLOBAL ASSET MANAGEMENT TRUST
GARTMORE MUTUAL FUNDS
AND GARTMORE GLOBAL PARTNERS
EFFECTIVE MARCH 1 , 2005
Funds of the Trust Advisory Fees
------------------ -------------
Gartmore China Opportunities Fund(1) .625% on assets up to $500 million
.600% on assets of $500 million
and more but less than $2 billion
.575% on assets of $2 billion and more
Gartmore Global Natural Resources Fund(1) .45% on assets up to $500 million
.425% on assets of $500 million
and more but less than $2 billion
.40% on assets of $2 billion and more
(1) Performance Fees for the Funds.
The base subadvisory fee for each of these Funds, as set forth above,
is adjusted each quarter beginning one year after implementation of the
Performance Fee, depending upon a Fund's investment performance for the 12
months preceding the end of that month relative to the investment performance of
each respective Fund's benchmark as listed [below]. The base fee is either
increased or decreased proportionately by the following amounts at each
breakpoint, based upon whether a Fund has out-performed or under-performed its
respective benchmark (using the performance of each such Fund's Class A Shares
to measure), by more or less than a maximum of 500 basis points over the
preceding rolling 12 month period as follows:
+/- 100 bps under/outperformance 2bps
+/- 200 bps under/outperformance 4bps
+/- 300 bps under/outperformance 6bps
+/- 400 bps under/outperformance 8bps
+/- 500 bps or more under/outperformance 10bps
The investment performance of each Fund will be the sum of: (1) the
change in each Fund's value during such period; (2) the value of the Fund's cash
distributions (from net income and realized net gains) having an ex-dividend
date during such calculation period; and (3) the value of any capital gains
taxes paid or accrued during such calculation period for undistributed realized
long-term capital gains from the Fund. For this purpose, the value of
distributions per share of realized capital gains, of dividends per share paid
from investment income and of capital gains taxes per share reinvested in the
Fund will be the Fund's value in effect at the close of business on the record
date for the payment of such distributions and the date on which provision is
made for such taxes, after giving effect to such distribution, dividends and
taxes.
Benchmark Index Performance:
----------------------------
The performance of each respective benchmark Index for a calculation
period, expressed as a percentage of each Index, at the beginning of such period
will be the sum of: (1) the change in the level of the Index during such period;
and (2) the value, as calculated consistent with the Index, of cash
distributions having an ex-dividend date during such period made by those
companies whose securities comprise the Index. For this purpose, cash
distributions on the securities that comprise the Index will be treated as if
they were reinvested in the Index at least as frequently as the end of each
calendar quarter following payment of the dividend.
Benchmark Index:
----------------
1. Gartmore China Opportunities Fund MSCI Xxxxx Xxx Index
2. Gartmore Global Natural Resources Fund Xxxxxxx Sachs Natural Resources
Index
EXHIBIT B
SUBADVISORY AGREEMENT AMONG
GARTMORE MUTUAL FUNDS,
GARTMORE GLOBAL ASSET MANAGEMENT TRUST and
GARTMORE GLOBAL PARTNERS
Effective March 1, 2005
In connection with securities transactions for a Fund, the Subadviser that is
(or whose affiliated person is) entering into the transaction, and any other
investment manager that is advising an affiliate of the Fund (or portion of the
Fund) (collectively, the "Managers" for the purposes of this Exhibit) entering
into the transaction are prohibited from consulting with each other concerning
transactions for the Fund in securities or other assets and, if both Managers
are responsible for providing investment advice to the Fund, the Manager's
responsibility in providing advice is expressly limited to a discrete portion of
the Fund's portfolio that it manages.
This prohibition does not apply to communications by the Adviser in connection
with the Adviser's (i) overall supervisory responsibility for the general
management and investment of the Fund's assets; (ii) determination of the
allocation of assets among the Manager(s), if any; and (iii) investment
discretion with respect to the investment of Fund assets not otherwise assigned
to a Manager.
TRUST
GARTMORE MUTUAL FUNDS
By:______________________________________
Name:
Title:
ADVISER
GARTMORE GLOBAL ASSET MANAGEMENT TRUST
By:______________________________________
Name:
Title:
SUBADVISER
GARTMORE GLOBAL PARTNERS
By:______________________________________
Name:
Title:
