XXXXXXXX RONON Xxxxxxxx Ronon Xxxxxxx & Xxxxx, LLP
ATTORNEYS AT LAW 0000 Xxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
Telephone (000) 000-0000
Fax (000) 000-0000
Xxxxxxx X. Xxxxxxx, III
XXxxxxxx@xxxxxxxx.xxx
000-000-0000
June 23, 2003
Board of Trustees
Gartmore Mutual Funds
0000 Xxxxx Xxxx
Xxxxxxxxxxxx, XX 00000
Board of Trustees
The Xxxxxxxxxx Funds II
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
RE: Agreement and Plan of Reorganization (the "Agreement") made as of the
14th day of March 2003 by and between Gartmore Mutual Funds, an Ohio
business trust ("GMF"), on behalf of its series, the Gartmore Long-Short
Equity Plus Fund (the "Acquiring Fund"), and The Xxxxxxxxxx Funds II, a
Delaware Statutory trust ("Xxxxxxxxxx II"), on behalf of its series,
Xxxxxxxxxx Partners Long-Short Equity Plus Fund (the "Acquired Fund"),
Gartmore Global Investments, Inc. and Commerzbank AG
---------------------------------------------------------------------------
Ladies and Gentlemen:
You have requested our opinion concerning certain federal income tax
consequences of the reorganization of the Acquired Fund (the "Reorganization"),
which will consist of: (i) the acquisition by the Acquiring Fund on the Exchange
Date of all of the Assets of the Acquired Fund; (ii) the assumption by the
Acquiring Fund, on the Exchange Date, of the Acquired Fund's Stated Liabilities;
(iii) the delivery to the Acquired Fund of full and fractional Class A, B and C
shares of beneficial interest, without par value, of the Acquiring Fund, which
are voting securities (the "Acquiring Fund Shares"), equal in the aggregate
value to the aggregate net asset value of the full and fractional shares of
beneficial interest, $.01 par value per share, of the Acquired Fund held by
shareholders of record as of the Exchange Date (the "Acquired Fund Shares") with
shareholders of the Acquired Fund receiving Class A Acquiring Fund Shares for
Class R and Class A Acquired Fund Shares, Class B Acquiring Fund Shares for
Class B
Philadelphia, PA o Malvern, PA o Wilmington, DE o Cherry Hill, NJ o Washington, DC
A Pennsylvania Limited Liability Partnership
Board of Trustees, Gartmore Mutual Funds
Board of Trustees, The Xxxxxxxxxx Funds II
June 23, 2003
Page 2
Acquired Fund Shares, and Class C Acquiring Fund Shares for Class C Acquired
Fund Shares; and (iv) the distribution of Acquiring Fund Shares to the
shareholders of the Acquired Fund according to their respective interests in the
Acquired Fund, following which the Acquired Fund will be dissolved as soon as
practicable after consummation of the transactions described in the Agreement.
In rendering our opinion, we have reviewed and relied upon: (a) the
Agreement, made as of the 14th day of March 2003, by and between (in part) the
Acquired Fund and the Acquiring Fund; (b) the proxy materials provided to
shareholders of the Acquired Fund in connection with the Special Meeting of
Shareholders of the Acquired Fund held on June 13, 2003; (c) certain
representations concerning the Reorganization made to us by the Acquired Fund
and the Acquiring Fund in a letter dated June 23, 2003 (the "Representation
Letter"); (d) all other documents, financial and other reports and corporate
minutes we deemed relevant or appropriate; and (e) such statutes, regulations,
rulings and decisions as we deemed material in rendering this opinion. All terms
used herein, unless otherwise defined, are used as defined in the Agreement.
For purposes of this opinion, we have assumed that the Acquired Fund, on
the Exchange Date, satisfies, and immediately following the Exchange Date the
Acquiring Fund will continue to satisfy, the requirements of Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code"), for qualification as a
regulated investment company.
Based on the foregoing, and provided the Reorganization is carried out in
accordance with the applicable laws of the State of Ohio and State of Delaware,
the terms of the Agreement and the statements in the Representation Letter, it
is our opinion that:
1. The acquisition by the Acquiring Fund of all of the Assets of the
Acquired Fund, as provided for in the Agreement, in exchange for the Acquiring
Fund Shares and the assumption by the Acquiring Fund of the Stated Liabilities
of the Acquired Fund, followed by the distribution by the Acquired Fund to its
shareholders of the Acquiring Fund Shares in complete liquidation of the
Acquired Fund, will qualify as a reorganization within the meaning of Section
368(a)(1)(F) of the Code, and the Acquired Fund and the Acquiring Fund each will
be a "party to the reorganization" within the meaning of Section 368(b) of the
Code.
2. No gain or loss will be recognized by the Acquired Fund upon the
transfer of all of its Assets to, and assumption of its Stated Liabilities by,
the Acquiring Fund in exchange for the Acquiring Fund Shares pursuant to Section
361(a) and Section 357(a) of the Code.
3. No gain or loss will be recognized by the Acquiring Fund upon the
receipt by it of all of the Assets of the Acquired Fund in exchange for the
Acquiring Fund Shares pursuant to Section 1032(a) of the Code.
4. No gain or loss will be recognized by the Acquired Fund upon the
distribution of the Acquiring Fund Shares to its shareholders in complete
liquidation of the Acquired Fund (in pursuance of the Agreement) pursuant to
Section 361(c)(1) of the Code.
Board of Trustees, Gartmore Mutual Funds
Board of Trustees, The Xxxxxxxxxx Funds II
June 23, 2003
Page 3
5. The basis of the Assets of the Acquired Fund received by the Acquiring
Fund will be the same as the basis of these Assets to the Acquired Fund
immediately prior to the exchange pursuant to Section 362(b) of the Code.
6. The holding period of the Assets of the Acquired Fund received by the
Acquiring Fund will include the period during which such Assets were held by the
Acquired Fund pursuant to Section 1223(2) of the Code.
7. No gain or loss will be recognized by the shareholders of the Acquired
Fund upon the exchange of their Acquired Fund Shares for the Acquiring Fund
Shares (including fractional shares to which they may be entitled), pursuant to
Section 354(a) of the Code.
8. The basis of the Acquiring Fund Shares received by the shareholders of
the Acquired Fund (including fractional shares to which they may be entitled)
will be the same as the basis of the Acquired Fund Shares exchanged therefor
pursuant to Section 358(a)(1) of the Code.
9. The holding period of the Acquiring Fund Shares received by the
shareholders of the Acquired Fund (including fractional shares to which they may
be entitled) will include the holding period of the Acquired Fund Shares
surrendered in exchange therefor, provided that the Acquired Fund Shares were
held as a capital asset on the Exchange Date pursuant to Section 1223(1) of the
Code.
10. The Acquiring Fund will succeed to and take into account, as of the
date of the transfer as defined in Section 1.381(b)-1(b) of the income tax
regulations issued by the United States Department of the Treasury (the
"Treasury Regulations"), the items of the Acquired Fund described in Section
381(c) of the Code.
Our opinion is based upon the Code, the applicable Treasury Regulations,
the present positions of the Internal Revenue Service (the "Service") as are set
forth in published revenue rulings and revenue procedures, present
administrative positions of the Service, and existing judicial decisions, all of
which are subject to change either prospectively or retroactively. We do not
undertake to make any continuing analysis of the facts or relevant law following
the date of the Reorganization.
Our opinion is conditioned upon the performance by GMF on behalf of the
Acquiring Fund and Xxxxxxxxxx XX on behalf of the Acquired Fund of their
undertakings in the Agreement and the Representation Letter. Our opinion is
limited to the transactions incident to the Reorganization described herein, and
no opinion is rendered with respect to (i) any other transaction or (ii) the
effect, if any, of the Reorganization (and/or the transactions incident thereto)
on any other transaction and/or the effect, if any, of any such other
transaction on the Reorganization.
This opinion is being rendered to GMF on behalf of the Acquiring Fund and
Xxxxxxxxxx XX on behalf of the Acquired Fund and may be relied upon only by such
funds and the shareholders of each. We hereby consent to the use of this opinion
as an exhibit to the Registration Statement of the Acquiring Fund on Form N-14,
and any amendments thereto,
Board of Trustees, Gartmore Mutual Funds
Board of Trustees, The Xxxxxxxxxx Funds II
June 23, 2003
Page 4
covering the registration of the shares of the Acquiring Fund under the
Securities Act of 1933, as amended, to be issued in the Reorganization.
Very truly yours,
XXXXXXXX, XXXXX, XXXXXXX & XXXXX, LLP
By: /s/ Xxxxxxx X. Xxxxxxx, III
-----------------------------------
Xxxxxxx X. Xxxxxxx, III, a partner
XXXXXXXX RONON Xxxxxxxx Ronon Xxxxxxx & Xxxxx, LLP
ATTORNEYS AT LAW 0000 Xxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
Telephone (000) 000-0000
Fax (000) 000-0000
Xxxxxxx X. Xxxxxxx, III
XXxxxxxx@xxxxxxxx.xxx
000-000-0000
June 23, 2003
Board of Trustees
Gartmore Mutual Funds
0000 Xxxxx Xxxx
Xxxxxxxxxxxx, XX 00000
Board of Trustees
The Xxxxxxxxxx Funds
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Re: Agreement and Plan of Reorganization (the "Agreement") made as of the
14th day of March 2003 by and among Gartmore Mutual Funds, an Ohio business
trust ("GMF"), on behalf of its series, the Gartmore Worldwide Leaders Fund
(the "Acquiring Fund"), The Xxxxxxxxxx Funds, a Massachusetts business
trust ("Xxxxxxxxxx"), on behalf of its series, the Xxxxxxxxxx Global
Opportunities Fund and Xxxxxxxxxx Global Focus Fund (each an "Acquired
Fund" and collectively, the "Acquired Funds"), Gartmore Global Investments,
Inc. and Commerzbank AG
---------------------------------------------------------------------------
Ladies and Gentlemen:
You have requested our opinion concerning certain federal income tax
consequences of the reorganization of the Acquired Funds (the "Reorganization"),
which will consist of: (i) the acquisition by the Acquiring Fund on the Exchange
Date of all of the Assets of the Acquired Funds; (ii) the assumption by the
Acquiring Fund, on the Exchange Date, of the Acquired Funds' Stated Liabilities;
(iii) the delivery to the Acquired Funds of full and fractional Class A shares
of beneficial interest, without par value, of the Acquiring Fund, which are
voting securities (the "Acquiring Fund Shares"), equal in aggregate value to the
aggregate net asset value of the full and fractional shares of beneficial
interest, $.01 par value per share, of the Acquired Funds held by shareholders
of record as of the Exchange Date (the "Acquired Fund Shares") with shareholders
of an Acquired Fund receiving Class A Acquiring Fund Shares for Class R and
Class A Acquired Fund Shares; and (iv) the distribution of Acquiring Fund Shares
to the shareholders of the Acquired Funds according to their respective
interests in an Acquired Fund, following which the Acquired Funds will be
dissolved as soon as practicable after consummation of the transactions
described in the Agreement.
Philadelphia, PA o Malvern, PA o Wilmington, DE o Cherry Hill, NJ o Washington, DC
A Pennsylvania Limited Liability Partnership
Board of Trustees, Gartmore Mutual Funds
Board of Trustees, The Xxxxxxxxxx Funds
June 23, 2003
Page 2
In rendering our opinion, we have reviewed and relied upon: (a) the
Agreement, made as of the 14th day of March 2003, by and among (in part) the
Acquired Funds and the Acquiring Fund; (b) the proxy materials provided to
shareholders of the Acquired Funds in connection with the Special Meeting of
Shareholders of the Acquired Funds held on June 13, 2003; (c) certain
representations concerning the Reorganization made to us by the Acquired Funds
and the Acquiring Fund in letters dated the June 23, 2003 (the "Representation
Letters"); (d) all other documents, financial and other reports and corporate
minutes we deemed relevant or appropriate; and (e) such statutes, regulations,
rulings and decisions as we deemed material in rendering this opinion. All terms
used herein, unless otherwise defined, are used as defined in the Agreement.
For purposes of this opinion, we have assumed that the Acquired Funds, on
the Exchange Date, satisfy, and immediately following the Exchange Date the
Acquiring Fund will continue to satisfy, the requirements of Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code"), for qualification as a
regulated investment company.
Based on the foregoing, and provided the Reorganization is carried out in
accordance with the applicable laws of the Commonwealth of Massachusetts and
State of Ohio, the terms of the Agreement and the statements in the
Representation Letters, it is our opinion that:
1. The acquisition by the Acquiring Fund of all of the Assets of the
Acquired Funds, as provided for in the Agreement, in exchange for the Acquiring
Fund Shares and the assumption by the Acquiring Fund of the Stated Liabilities
of the Acquired Funds, followed by the distribution by the Acquired Funds to
their shareholders of the Acquiring Fund Shares in complete liquidation of the
Acquired Funds, will qualify as a reorganization within the meaning of Section
368(a)(1) of the Code, and the Acquired Funds and the Acquiring Fund each will
be a "party to the reorganization" within the meaning of Section 368(b) of the
Code.
2. No gain or loss will be recognized by the Acquired Funds upon the
transfer of all of their Assets to, and assumption of the Stated Liabilities by,
the Acquiring Fund in exchange for the Acquiring Fund Shares pursuant to Section
361(a) and Section 357(a) of the Code.
3. No gain or loss will be recognized by the Acquiring Fund upon the
receipt by it of all of the Assets of the Acquired Funds in exchange for the
Acquiring Fund Shares pursuant to Section 1032(a) of the Code.
4. No gain or loss will be recognized by the Acquired Funds upon the
distribution of the Acquiring Fund Shares to their shareholders in complete
liquidation of the Acquired Funds (in pursuance of the Agreement) pursuant to
Section 361(c)(1) of the Code.
5. The basis of the Assets of the Acquired Funds received by the Acquiring
Fund will be the same as the basis of these Assets to the Acquired Funds
immediately prior to the exchange pursuant to Section 362(b) of the Code.
Board of Trustees, Gartmore Mutual Funds
Board of Trustees, The Xxxxxxxxxx Funds
June 23, 2003
Page 3
6. The holding period of the Assets of the Acquired Funds received by the
Acquiring Fund will include the period during which such Assets were held by the
Acquired Funds pursuant to Section 1223(2) of the Code.
7. No gain or loss will be recognized by the shareholders of the Acquired
Funds upon the exchange of their Acquired Fund Shares for the Acquiring Fund
Shares (including fractional shares to which they may be entitled), pursuant to
Section 354(a) of the Code.
8. The basis of the Acquiring Fund Shares received by the shareholders of
the Acquired Funds (including fractional shares to which they may be entitled)
will be the same as the basis of the Acquired Fund Shares exchanged therefor
pursuant to Section 358(a)(1) of the Code.
9. The holding period of the Acquiring Fund Shares received by the
shareholders of the Acquired Funds (including fractional shares to which they
may be entitled) will include the holding period of the Acquired Fund Shares
surrendered in exchange therefor, provided that the Acquired Fund Shares were
held as a capital asset on the Exchange Date pursuant to Section 1223(1) of the
Code.
10. The Acquiring Fund will succeed to and take into account, as of the
date of the transfer as defined in Section 1.381(b)-1(b) of the income tax
regulations issued by the United States Department of the Treasury (the
"Treasury Regulations"), the items of the Acquired Funds described in Section
381(c) of the Code, subject to the conditions and limitations specified in
Sections 381, 382, 383 and 384 of the Code and the Treasury Regulations.
Our opinion is based upon the Code, the applicable Treasury Regulations,
the present positions of the Internal Revenue Service (the "Service") as are set
forth in published revenue rulings and revenue procedures, present
administrative positions of the Service, and existing judicial decisions, all of
which are subject to change either prospectively or retroactively. We do not
undertake to make any continuing analysis of the facts or relevant law following
the date of the Reorganization.
Our opinion is conditioned upon the performance by GMF on behalf of the
Acquiring Fund and Xxxxxxxxxx on behalf of the Acquired Funds of their
undertakings in the Agreement and the Representation Letter. Our opinion is
limited to the transactions incident to the Reorganization described herein, and
no opinion is rendered with respect to (i) any other transaction or (ii) the
effect, if any, of the Reorganization (and/or the transactions incident thereto)
on any other transaction and/or the effect, if any, of any such other
transaction on the Reorganization.
This opinion is being rendered to GMF on behalf of the Acquiring Fund and
Xxxxxxxxxx on behalf of the Acquired Funds and may be relied upon only by such
funds and the shareholders of each. We hereby consent to the use of this opinion
as an exhibit to the Registration Statement of the Acquiring Fund on Form N-14,
and any amendments thereto, covering the registration of the shares of the
Acquiring Fund under the Securities Act of 1933, as amended, to be issued in the
Reorganization.
Very truly yours,
XXXXXXXX, XXXXX, XXXXXXX & XXXXX, LLP
By: /s/ Xxxxxxx X. Xxxxxxx, III
-----------------------------------
Xxxxxxx X. Xxxxxxx, III, a partner
