EXHIBIT NO. EX-99.7(a)
UNDERWRITING AGREEMENT
BETWEEN
GARTMORE MUTUAL FUNDS
AND
GARTMORE DISTRIBUTION SERVICES, INC.
AGREEMENT, made as of this 1st day of October, 2002, by and between
Gartmore Mutual Funds (formerly Nationwide Mutual Funds), an Ohio business trust
(the "Trust"), and Gartmore Distribution Services, Inc., a Delaware corporation,
(the "Underwriter").
W I T N E S S E T H:
WHEREAS, the Underwriter is an affiliate of Nationwide Securities, Inc.
(formerly Nationwide Advisory Services, Inc.), which was the previous principal
underwriter of the Trust; and
WHEREAS, the Trust is engaged in business as an open-end management
investment company, as defined in the Investment Company Act of 1940 (the "1940
Act"), and is so registered with the Securities and Exchange Commission (the
"SEC") under the provisions of that Act; and
WHEREAS, it is mutually desired that the Underwriter undertake as agent
of the Trust, the sale and distribution of Shares of each of the investment
portfolios of the Trust which are listed on Schedule A to this Agreement (each a
"Fund");
NOW, THEREFORE, the parties do mutually agree and promise as follows:
1. Appointment as Underwriter. The Trust hereby appoints the
Underwriter their agent for the sale of the Shares covered by the registration
statement for the Trust. As used in this Agreement, the "registration statement"
shall refer to the Trust's current registration on Form N-1A and shall include
the prospectus (Part A), Statement of Additional Information (Part B) and Part
C, and together the current prospectus and Statement of Additional Information
shall be referred to as the "Prospectus." The Trust understands that Underwriter
is now and may in the future be the distributor of the shares of several
investment companies or series (together, "Companies") including Companies
having investment objectives similar to those of the Trust. The Trust agrees
that Distributor's duties to such Companies shall not be deemed in conflict with
its duties to the Trust under this paragraph.
2. Duties of Underwriter. (a) The Underwriter hereby accepts such
appointment as distributor for the sale of the Shares and agrees that it will
use its best efforts to solicit orders for the sale of the Shares and will
undertake such advertising and promotion as it believes reasonable in connection
with such solicitation. The Underwriter shall, at its own expense, finance
appropriate activities which are primarily intended to result in the sale of the
Shares, including, but not limited
to, advertising, compensation of underwriters, dealers and sales personnel, the
printing and mailing of prospectuses to other than current Shareholders, and the
printing and mailing of sales literature.
(b) In its capacity as Underwriter, Underwriter agrees to act
in conformity with the Prospectus and the Trust's Declaration of Trust and
Bylaws and with instructions received from the Trustees of the Trust and shall
conform to and comply with all applicable laws, rules and regulations,
including, without limitation, the 1940 Act, all rules and regulations
promulgated by the SEC thereunder and all rules and regulations adopted by any
securities association registered under the Securities Exchange Act of 1934.
(c) The Underwriter may, and when requested by the Trustees or
their representatives shall, suspend its efforts to effectuate sales of Shares
on behalf of the Trust at any time when in the opinion of the Underwriter or of
the Trustees no sales should be made because of market or other economic
considerations or abnormal circumstances of any kind. The Trust and its Trustees
may withdraw the offering of the Shares (i) at any time with the consent of the
Underwriter, or (ii) without such consent when so required by the provisions of
any statute or of any order, rule or regulation of any governmental body having
jurisdiction. It is mutually understood and agreed that the Underwriter does not
undertake to sell all or any specific portion of the Shares.
(d) The Underwriter agrees on behalf of itself and its
directors, officers and employees to treat confidentially and as proprietary
information of the Trust all records and other information relative to the Trust
and its prior, present or potential Shareholders, and not to use such records
and information for any purpose other than performance of its responsibilities
and duties hereunder, except when requested by the Trust or when requested to
divulge such information by duly constituted authorities, after prior
notification to and approval in writing by the Trust. Such approval shall not be
unreasonably withheld and may not be withheld where the Underwriter may be
exposed to civil or criminal contempt proceedings for failure to comply.
3. Sale and Payment of Shares. (a) The Underwriter shall have the
right to purchase Shares of the Funds at the net asset value in effect at the
time that orders for such Shares are received by the Trust or its authorized
agent and to sell such Shares at the applicable public offering price through
dealers or other persons. The public offering price for the Shares of each Fund
shall equal to the sum of (a) the net asset value per Share next computed for a
Fund by the Trust and (b) any applicable sales charge, all as set forth in the
current Prospectus for the Fund. The net asset value of the Shares shall be
determined in accordance with the provisions of the Trust's Declaration of Trust
and the Prospectus. The Trust shall allow the Underwriter as compensation for
its services the particular sales charge applicable to the Shares sold. The
Underwriter may fix the portion of the distribution charge to be allowed to
dealers and others.
(b) The Underwriter agrees that it will deliver or cause to be
delivered to the Trust or to its authorized agent, as the Trustees may direct,
an amount equal to the net asset value of Shares for which purchase orders have
been placed with and accepted by the Underwriter and shall forward to the Trust
or its authorized agent, as the Trustees may direct, all orders for the purchase
of Shares with reasonable promptness after the receipt and acceptance thereof by
the Underwriter; provided, however, that the Underwriter shall have the sole
right to accept or reject all orders for the purchase
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of Shares and will return promptly any rejected order together with the
consideration which accompanied it.
4. Issuance of Shares. The Trust reserves the right to issue,
transfer or sell Shares, which are otherwise subject to a sales charge, at net
asset value (a) in connection with the merger or consolidation of the Trust or
the Fund(s) with any other investment company or the acquisition by the Trust or
the Fund(s) of all or substantially all of the assets or of the outstanding
Shares of any other investment company; (b) in connection with a pro rata
distribution directly to the holders of Shares in the nature of a stock dividend
or split; (c) upon the exercise of subscription rights granted to the holders of
Shares on a pro rata basis; (d) in connection with the issuance of Shares
pursuant to any exchange and reinvestment privileges described in the Prospectus
of a Fund; (e) in a sale to the Trustees, employees, officers and directors of
or salespersons employed by the Underwriter and to officers, directors and
employees of any investment adviser of the Trust; and (f) otherwise in
accordance with the Prospectus of a Fund.
5. The Trust agrees as follows:
(1) to use its best efforts to maintain its registration as a
diversified open-end management investment company under
the 1940 Act, and to comply with all of the provisions of
that Act and of the rules and regulations thereunder;
(2) to register its Shares under the Securities Act of 1933,
and to use its best efforts to maintain such registration;
(3) to prepare and file such amendments to the registration
statements and Prospectus and other statements or reports
as may be necessary to comply with the Securities Act of
1933, the 1940 Act, and the rules and regulations of the
SEC;
(4) to furnish the Underwriter with a sufficient number of
Prospectuses to meet the Underwriter's requirements for use
in connection with sales of Shares, and that the
Underwriter will not be required to use any prospectuses of
the Trust which shall not be in form and content
satisfactory to counsel for the Underwriter; and
(5) at the request of the Underwriter, to take such steps as
may be necessary and feasible to qualify Shares for sale in
each state, territory or dependency of the United States of
America, in the District of Columbia and in foreign
countries, in accordance with the laws thereof, and to
renew or extend any such qualification; provided, however,
that the Trust shall not be required to qualify Shares or
to maintain the qualification of Shares in any state,
territory, dependency, district or country where they shall
deem such qualification disadvantageous to the Trust.
6. The Underwriter agrees as follows:
(1) that the Underwriter and its officers or directors will
purchase and keep Shares only for investment purposes;
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(2) that it will not purchase Shares from the Shareholders
except as agent for the Trust;
(3) that upon the request of the Trust or its representative it
will furnish to the Trust or such representative any
information in its possession which is pertinent to the
preparation of any Registration Statement, Prospectus or
amendment thereto, or any report required by law or
regulation; and
(4) that neither the Underwriter nor any other person
authorized by it to solicit purchases of Shares shall give
any information or make any representations, other than
those contained in the Registration Statement or Prospectus
or in any supplemental sales literature authorized by the
Trust for use in connection with the sale of shares.
7. Fees and Expenses. The Trust may pay a distribution fee to the
Underwriter determined in accordance with any applicable Distribution Plan
adopted by the Trustees and approved by the shareholders pursuant to Rule 12b-1
under the 1940 Act.
The Underwriter shall pay expenses for (i) printing and distributing any
prospectus and preparing, printing and distributing any other literature used by
the Underwriter in connection with the offering of the Shares for sale to the
public (except such expenses as may be incurred by the Trust in connection with
the preparation, printing and distribution of any Prospectus, report or other
communication to Shareholders, to the extent that such expenses are necessarily
incurred to effect compliance by the Trust with any Federal or state law or to
enable such distribution to Shareholders), and (ii) expenses of advertising in
connection with such offering. The Trust will pay or cause to be paid (i) all
fees and expenses for the issue and delivery of Shares, and (ii) all auditing
expenses of the Trust.
8. Repurchase of Shares. The Trustees hereby appoint the Underwriter
its agent to repurchase Shares, upon the written request of the Shareholders,
accompanied by the certificate or certificates representing such Shares (if
certificates for such Shares have been issued by the Trust) properly endorsed
for transfer, at the net asset value in effect at the time when the sale is
made.
9. Indemnification. (a) The Trust agrees to indemnify, defend and
hold the Underwriter, its directors, officers and employees, and any person who
controls the Underwriter within the meaning of Section 15 of the Securities Act
("Underwriter Affiliates") free and harmless from and against any and all
claims, demands, liabilities and expenses (including the cost of investigating
or defending such claims, demands or liabilities and any counsel fees incurred
in connection therewith) which the Underwriter and the Underwriter Affiliates
may incur under the Securities Act or under common law or otherwise, arising out
of or based upon any untrue statement, or alleged untrue statement, of a
material fact contained in any registration statement or any prospectus or
arising out of or based upon any omission, or alleged omission, to state a
material fact required to be stated in either any registration statement or any
prospectus or necessary to make the statements in either thereof not misleading.
Provided, however, that the Trust's agreement to indemnify the Underwriter and
the Underwriter Affiliates shall not be deemed to cover any claims, demands,
liabilities or expenses arising out of any information or representations which
were furnished in writing to the Trust by the Underwriter, or arising out of or
based upon any omission or alleged omission to state a
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material fact in connection with the giving of such information required to be
stated in such answers or necessary to make the answers not misleading; and
further provided that the Trust's agreement to indemnify Underwriter and the
Underwriter Affiliates shall not be deemed to cover any liability to the Trust
or its Shareholders to which the Underwriter would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence in the performance
of its duties, or by reason of the Underwriters reckless disregard of its
obligations and duties under this Agreement.
(b) The Underwriter agrees to indemnify, defend and hold the
Trust, its several officers and Trustees and any person who controls the Trust
within the meaning of Section 15 of the Securities Act ("Trust Affiliates") free
and harmless from and against any and all claims, demands, liabilities and
expenses (including the costs of investigating or defending such claims, demands
or liabilities and any counsel fees incurred in connection therewith) which the
Trust and the Trust Affiliates may incur under the Securities Act or under
common law or otherwise, but only to the extent that such liability or expense
incurred by the Trust or the Trust Affiliates resulting from such claims or
demands, shall arise out of or be based upon any untrue, or alleged untrue,
statement of a material fact contained in information furnished in writing by
the Underwriter to the Trust and used in the answers to any of the items of the
registration statement or in the Prospectus, or shall arise out of or be based
upon any omission, or alleged omission, to state a material fact in connection
with such information furnished in writing by the Underwriter to the Trust
required to be stated in such answers or necessary to make such information not
misleading.
10. Term, Duration and Termination. The term of this Agreement shall
begin as of the date first written above (or, if a particular Fund is not in
existence on that date, the date an amendment to Schedule A to this Agreement
adding the new Fund is executed) and, unless sooner terminated as provided
herein, shall remain in effect for a period of two (2) years from that date.
Thereafter, if not terminated, this Agreement shall continue in effect from year
to year thereafter provided such continuance shall be approved at least annually
by (a) a majority of the Trustees or by the affirmative vote or written approval
of the holders of a majority of the outstanding Shares and (b) a majority of the
Trustees who are not interested persons of the Underwriter, the term "interested
person" having the meaning defined in Section 2(a)(19) of the 1940 Act. This
Agreement is terminable without penalty, on not less than sixty days prior
written notice, by the Trust's Board of Trustees, by vote of a majority of the
outstanding voting securities of the Trust or by the Underwriter. This Agreement
will also terminate automatically in the event of its assignment (as such term
is defined in the 1940 Act).
11. Amendment. This Agreement may not be amended or changed in any
manner except by a written agreement executed by both the Trust and the
Underwriter.
12. Jurisdiction. This Agreement shall be governed by and in
accordance with the substantive laws of the State of Ohio without reference to
choice of law principles thereof and in accordance with the 1940 Act. In case of
any conflict, the 1940 Act shall control.
13. 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 a Declaration of Trust
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dated as of October 30, 1997, as has been or may be amended from time to time,
and to which reference is hereby made and a copy of which is on file at the
office of the Secretary of State of Ohio and elsewhere as required by law, and
to any and all amendments thereto so filed or hereafter filed. The obligations
of the Trust entered into in the name or on behalf thereof by any of Gartmore
Mutual Fund's Trustees, representatives, or agents are not made individually,
but only in their capacities with respect to the Gartmore Mutual Funds. Such
obligations are not binding upon any of the Trustees, shareholders, or
representatives of the Trust personally, but bind only the assets of the Trust.
All person dealing with any series of Shares of the Trust must look solely to
the assets of the Trust belonging to such series for the enforcement of any
claims against the Trust.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
GARTMORE MUTUAL FUNDS
By:
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Name:
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Title:
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GARTMORE DISTRIBUTION SERVICES, INC.
By:
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Name:
-----------------------
Title:
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Schedule A
Underwriting Agreement
between Gartmore Mutual Funds and
Gartmore Distribution Services, Inc.
(Effective October 1, 2002)
Name of Fund
------------
Gartmore Total Return Fund (formerly Nationwide Fund)
Gartmore Growth Fund (formerly Nationwide Growth Fund)
Gartmore Millennium Growth Fund (formerly Nationwide New Economy Fund and
Nationwide Mid Cap Growth Fund)
Gartmore Bond Fund (formerly Nationwide Bond Fund)
Gartmore Tax-Free Income Fund (formerly Nationwide Tax-Free Income Fund)
Gartmore Government Bond Fund (formerly Nationwide Intermediate U.S. Government
Bond Fund and Nationwide Government Bond Fund)
Gartmore Money Market Fund (formerly Nationwide Money Market Fund)
Gartmore Large Cap Value Fund (formerly Prestige Large Cap Value Fund and
Nationwide Large Cap Value Fund)
Nationwide Large Cap Growth Fund (formerly Prestige Large Cap Growth Fund)
Nationwide Small Cap Fund (formerly Prestige Small Cap Fund)
Gartmore Xxxxxx Capital Accumulation Fund (formerly Xxxxxx Capital Accumulation
Fund and Nationwide Xxxxxx Capital Accumulation Fund)
Gartmore Xxxxxx Enhanced Income Fund (formerly Xxxxxx Enhanced Income Fund and
Nationwide Xxxxxx Enhanced Income Fund)
Gartmore U.S. Growth Leaders Fund (formerly Nationwide Focus Fund and Gartmore
Growth 20 Fund)
Gartmore Value Opportunities Fund (formerly Nationwide Value Opportunities Fund)
Gartmore High Yield Bond Fund (formerly Nationwide High Yield Bond Fund)
Nationwide S&P 500 Index Fund
Nationwide Small Cap Index Fund
Nationwide Mid Cap Market Index Fund
Nationwide International Index Fund
Nationwide Bond Index Fund
Gartmore Investor Destinations Aggressive Fund (formerly Investor Destinations
Aggressive Fund and Nationwide Investor Destinations Aggressive Fund)
Gartmore Investor Destinations Moderately Aggressive Fund (formerly Investor
Destinations Moderately Aggressive Fund and Nationwide Investor Destinations
Moderately Aggressive Fund)
Gartmore Investor Destinations Moderate Fund (formerly Investor Destinations
Moderate Fund and Nationwide Investor Destinations Moderate Fund)
Gartmore Investor Destinations Moderately Conservative Fund (formerly Investor
Destinations Moderately Conservative Fund and Nationwide Investor Destinations
Moderately Conservative Fund)
Gartmore Investor Destinations Conservative Fund (formerly Investor Destinations
Conservative Fund and Nationwide Investor Destinations Conservative Fund)
Schedule A
Underwriting Agreement
between Gartmore Mutual Funds and
Gartmore Distribution Services, Inc.
(Effective October 1, 2002)
Name of Fund
------------
NorthPointe Small Cap Value Fund
Nationwide Growth Focus Fund
Gartmore Global Technology and Communications Fund (formerly Nationwide Global
Technology and Communications Fund)
Gartmore Global Health Sciences Fund (formerly Nationwide Global Life Sciences
Fund)
Gartmore Emerging Markets Fund
Gartmore International Growth Fund
Gartmore Worldwide Leaders Fund (formerly Gartmore Global Leaders Fund)
Gartmore European Leaders Fund (formerly Gartmore European Growth Fund)
Gartmore Global Small Companies Fund
Gartmore OTC Fund
Gartmore International Small Cap Growth Fund
Gartmore Asia Pacific Leaders Fund
Gartmore Global Financial Services Fund
Gartmore Global Utilities Fund
Gartmore Nationwide Leaders Fund (formerly Gartmore U.S. Leaders Fund)
Gartmore Micro Cap Equity Fund
Gartmore Mid Cap Growth Fund
