Exhibit d(3)
WM STRATEGIC ASSET MANAGEMENT PORTFOLIOS, LLC
AMENDED AND RESTATED
INVESTMENT MANAGEMENT AGREEMENT
AMENDED AND RESTATED INVESTMENT MANAGEMENT AGREEMENT (this
"Agreement"), dated as of May 14, 2002, amending and restating in its entirety
the Investment Management Agreement dated September 1, 2000, between the WM
Strategic Asset Management Portfolios, LLC, a Massachusetts limited liability
company (the "LLC"), on behalf of each of its investment portfolios, which are
listed on the signature page of this Agreement (each referred to herein as a
"Portfolio" and, collectively, as the "Portfolios") and WM Advisors, Inc., a
Washington corporation (the "Manager").
W I T N E S S E T H
WHEREAS, the LLC is an open-end management investment company,
registered under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, the LLC desires to retain the Manager to render investment
management services to each Portfolio, and the Manager is willing to render such
services;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the parties hereto agree as follows:
1. Appointment. The LLC hereby appoints the Manager to act as investment
manager to each Portfolio for the period and on the terms set forth in
this Agreement. The Manager accepts such appointment and agrees to
render the services herein described, for the compensation herein
provided.
2. Management. Subject to the supervision of the Board of Trustees of the
LLC, the Manager shall manage the investment operations of each
Portfolio and the composition of each Portfolio's portfolio, including
the purchase, retention and disposition of securities therefor, in
accordance with such Portfolio's investment objectives, policies and
restrictions as stated in the Prospectus and Statement of Additional
Information (as such terms are hereinafter defined) and resolutions of
the LLC's Board of Trustees and subject to the following
understandings:
A. The Manager shall provide supervision of each Portfolio's
investments, furnish a continuous investment program for each
Portfolio's portfolio and determine from time to time what
securities will be purchased, retained, or sold by each
Portfolio, and what portion of the assets will be invested or
held as cash.
B. The Manager, in the performance of its duties and obligations
under this Agreement, shall act in conformity with the Limited
Liability Company Agreement of the LLC and the investment
policies of the Portfolios as determined by the Board of
Trustees of the LLC.
C. The Manager shall determine the securities to be purchased or
sold by each Portfolio and shall place orders for the purchase
and sale of portfolio securities pursuant to its determinations
with brokers or dealers selected by the Manager. In executing
portfolio transactions and selecting brokers or dealers, the
Manager shall use its best efforts to seek on behalf of each
Portfolio the best overall terms available. In assessing the
best overall terms available for any transaction, the Manager
may consider all factors it deems relevant, including the
breadth of the market in the security, the price of the
security, the size of the transaction, the timing of the
transaction, the reputation, financial condition, experience,
and execution capability of a broker or dealer, the amount of
commission, and the value of any brokerage and research services
(as those terms are defined in Section 28(e) of the Securities
Exchange Act of 1934, as amended) provided by a broker or
dealer. The Manager is authorized to pay to a broker or dealer
who provides such brokerage and research services a commission
for executing a portfolio transaction for a Portfolio which is
in excess of the amount of commission another broker or dealer
would have charged for effecting the transaction if the Manager
determines in good faith that such commission was reasonable in
relation to the value of the brokerage and research services
provided by such broker or dealer, viewed in terms of that
particular transaction or in terms of the overall
responsibilities of the Manager to the Portfolio and/or other
accounts over which the Manager exercises investment discretion.
D. On occasions when the Manager deems the purchase or sale of a
security to be in the best interest of a Portfolio as well as
other fiduciary accounts for which it has investment
responsibility, the Manager, to the extent permitted by
applicable laws and regulations, may aggregate the securities to
be so sold or purchased in order to obtain the best execution,
most favorable net price or lower brokerage commissions.
E. Subject to the provisions of the Limited Liability Company
Agreement of the LLC and the 1940 Act, the Manager, at its
expense, may select and contract with one or more investment
advisers (the "Sub-adviser") for a Portfolio to perform some or
all of the services for which it is responsible pursuant to this
Section 2. The Manager shall be solely responsible for the
compensation of any Sub-adviser of a Portfolio for its services
to a Portfolio. The Manager may terminate the services of any
Sub-adviser at any time in its sole discretion, and shall at
such time assume the responsibilities of such Sub-adviser unless
and until a successor Sub-adviser is selected. To the extent
that more than one Sub-adviser is selected, the Manager shall,
in its sole discretion, determine the amount of a Portfolio's
assets allocated to each such Sub-adviser.
3. Administrative. Subject to the supervision and direction of the Board
of Trustees of the LLC, the Manager is also responsible for all
administrative functions with respect to the LLC and will (a) supervise
all aspects of the operations of the LLC; (b) supply the LLC with
office facilities (which may be in the Manager's own offices),
statistical and research data, data processing services, clerical,
accounting and bookkeeping services (including,
but not limited to, the calculation of (i) the net asset values of
shares of the LLC, and (ii) distribution fees), internal auditing and
legal services, internal executive and administrative services, and
stationery and office (c) prepare reports to the LLC's shareholders and
materials for the Board of Trustees of the LLC; (d) prepare tax returns
and reports to and filings with the Securities and Exchange Commission
and state Blue Sky authorities; (e) cooperate with the LLC's transfer
agent for the purpose of establishing the implementing procedures to
ensure that the LLC's transfer agency and shareholder relations
functions are efficiently carried out; and (f) provide such other
similar services as the LLC may reasonably request to the extent
permitted under application statutes, rules and regulations. The
services to be performed by the Manager hereunder may be delegated by
it, in whole or in part, to one or more sub-administrators provided
that any delegation of duties to a sub-administrator shall not relieve
the Manager of its responsibilities hereunder. Notwithstanding anything
to the contrary in this Agreement, the Manger shall not be responsible
for the performance of any duties which are required to be performed by
the LLC's transfer agent.
4. Services Not Exclusive. The services rendered by the Manager hereunder
to each Portfolio are not to be deemed exclusive, and the Manager shall
have the right to render similar services to others, including, without
limitation, other investment companies.
5. Expenses. During the term of this Agreement, the Manager shall pay all
expenses incurred by it in connection with its activities under this
Agreement, including the salaries and expenses of any of the officers
or employees of the Manager who act as officers, Trustees or employees
of the LLC, but excluding the cost of securities purchased for a
Portfolio and the amount of any brokerage fees and commissions incurred
in executing portfolio transactions for a Portfolio, and shall provide
the Portfolios with suitable office space. Other expenses to be
incurred in the operation of the Portfolios (other than those borne by
any third party), including without limitation, taxes, interest,
brokerage fees and commissions, fees of Trustees who are not officers,
directors, or employees of the Manager, federal registration fees and
state Blue Sky qualification fees, bookkeeping, charges of custodians,
transfer and dividend disbursing agents' fees, certain insurance
premiums, industry association fees, outside auditing and legal
expenses, costs of maintaining the Fund's or the LLC's existence, costs
of independent pricing services, costs attributable to investor
services (including, without limitation, telephone and personnel
expenses), costs of preparing, printing and distributing prospectuses
to existing shareholders, costs of stockholders' reports and meetings
of shareholders and Trustees, as applicable, and any extraordinary
expenses will be borne by the Portfolios.
6. Compensation. For the services provided pursuant to this Agreement,
each Portfolio shall pay to the Manager as full compensation therefor a
monthly fee computed on the average daily net assets at the annual rate
for each Portfolio as stated in Schedule A attached hereto. The LLC
acknowledges that the Manager, as agent for the Portfolios, will
allocate a portion of the fee equal to the sub-advisory fee payable to
the sub-advisor, if any, under its sub-advisory agreement to the
sub-advisor for sub-advisory services. The LLC acknowledges that the
Manager, as agent for the Portfolios, may allocate a portion of the fee
to WM Shareholder Services, Inc. for administrative services, portfolio
accounting and regulatory compliance systems. The Manager also from
time to time and in such amounts as it shall determine in its sole
discretion may allocate a portion of the fee to WM Funds Distributor,
Inc. for facilitating distribution of the Portfolios. This payment
would be made from revenue which otherwise would be considered profit
to the Manager for its services. This disclosure is being made to the
LLC solely for the purpose of conforming with requirements of the
Washington Department of Revenue for exclusion of revenue from the
Washington Business and Occupation Tax.
7. Limitation of Liability. The Manager shall not be liable for any error
of judgment or mistake of law or for any loss suffered by a Portfolio
in connection with the matters to which this Agreement relates, except
a loss resulting from willful misfeasance, bad faith or gross
negligence on its part in the performance of its duties or from
reckless disregard by it of its obligations and duties under this
Agreement.
8. Delivery of Documents. The LLC has heretofore delivered to the Manager
true and complete copies of each of the following documents and shall
promptly deliver to it all future amendments and supplements thereto,
if any:
A. Limited Liability Company Agreement (as presently in effect and
as amended from time to time);
B. Bylaws of the LLC;
C. Registration Statement under the Securities Act of 1933 and
under the 1940 Act of the LLC on Form N-1A, and all amendments
thereto, as filed with the Securities and Exchange Commission
(the "Registration Statement") relating to the Portfolios and
the shares of the Portfolios;
D. Notification of Registration of the LLC under the 1940 Act on
Form N-8A;
E. Prospectuses of the Portfolios (such prospectuses as presently
in effect and/or as amended or supplemented from time to time,
the "Prospectus"); and
1. Statement of Additional Information of the Portfolios (such statement
as presently in effect and/or as amended or supplemented from time to
time, the "Statement of Additional Information").
9. Duration and Termination. This Agreement shall become effective as of
the date first above-written for an initial period of two years and
shall continue thereafter so long as such continuance is specifically
approved at least annually (a) by the vote of the Board of Trustees,
including a majority of those members of the LLC's Board of Trustees
who are not parties to this Agreement or "interested persons" of any
such party, cast in person at a meeting called for that purpose, or (b)
by vote of a majority of the outstanding voting securities of the
Portfolios. Notwithstanding the foregoing, this Agreement (a) may be
terminated at any time, without the payment of any penalty, by either
the LLC (by vote of the LLC's Board of Trustees or by vote of a
majority of the outstanding voting securities
of the Portfolios) or the Manager, on sixty (60) days prior written
notice to the other, and (b) shall automatically terminate in the event
of its assignment. As used in this Agreement, the terms "majority of
the outstanding voting securities", "interested persons" and
"assignment" shall have the meanings assigned to such terms in the 1940
Act.
10. Amendments. No provision of this Agreement may be amended, modified,
waived or supplemented, except by a written instrument signed by the
party against which enforcement is sought. No amendment of this
Agreement shall be effective until approved in accordance with any
applicable provisions of the 1940 Act.
11. Use of Name and Logo. The LLC agrees that it shall furnish to the
Manager, prior to any use or distribution thereof, copies of all
prospectuses, statements of additional information, proxy statements,
reports to stockholders, sales literature, advertisements, and other
material prepared for distribution to stockholders of the LLC or to the
public, which in any way refer to or describe the Manager or which
include any trade names, trademarks or logos of the Manager or of any
affiliate of the Manager. The LLC further agrees that it shall not use
or distribute any such material if the Manager reasonably objects in
writing to such use or distribution within five (5) business days after
the date such material is furnished to the Manager.
The Manager and/or its affiliates own the names "WM," "WM Group of
Funds" and any other names which may be listed from time to time on a
Schedule B to be attached hereto that they may develop for use in
connection with the LLC, which names may be used by the LLC only with
the consent of the Manager and/or its affiliates. The Manager, on
behalf of itself and/or its affiliates, consents to the use by the LLC
of such names or any other names embodying such names, but only on
condition and so long as (i) this Agreement shall remain in full force,
(ii) the LLC shall fully perform, fulfill and comply with all
provisions of this Agreement expressed herein to be performed,
fulfilled or complied with by it, and (iii) the Manager is the manager
of each Portfolio of the LLC. No such name shall be used by the LLC at
any time or in any place or for any purposes or under any conditions
except as provided in this section. The foregoing authorization by the
Manager, on behalf of itself and/or its affiliates, to the LLC to use
such names as part of a business or name is not exclusive of the right
of the Manager and/or its affiliates themselves to use, or to authorize
others to use, the same; the LLC acknowledges and agrees that as
between the Manager and/or its affiliates and the LLC, the Manager
and/or its affiliates have the exclusive right so to use, or authorize
others to use, such names, and the LLC agrees to take such action as
may reasonably be requested by the Manager, on behalf of itself and/or
its affiliates, to give full effect to the provisions of this section
(including, without limitation, consenting to such use of such names).
Without limiting the generality of the foregoing, the LLC agrees that,
upon (i) any violation of the provisions of this Agreement by the LLC
or (ii) any termination of this Agreement, by either party or
otherwise, the LLC will, at the request of the Manager, on behalf of
itself and/or its affiliates, made within six months after such
violation or termination, use its best efforts to change the name of
the LLC and/or the Portfolios so as to eliminate all reference, if any,
to such names and will not thereafter transact any business in a name
containing such names in any form or combination whatsoever, or
designate itself as the
same entity as or successor to an entity of such names, or otherwise
use such names or any other reference to the Manager and/or its
affiliates, except as may be required by law. Such covenants on the
part of the LLC shall be binding upon it, its Trustees, officers,
shareholders, creditors and all other persons claiming under or through
it.
The provisions of this section shall survive termination of this
Agreement.
12. Notices. Any notice or other communication required to be given
pursuant to this Agreement shall be deemed duly given if delivered or
mailed by registered mail, postage prepaid, if to the LLC: 0000 Xxxxx
Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxxxxx 00000; or if to the Manager:
0000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxxxxx 00000; or to either
party at such other address as such party shall designate to the other
by a notice given in accordance with the provisions of this section.
13. Miscellaneous.
A. Except as otherwise expressly provided herein or authorized by
the Board of Trustees of the LLC from time to time, the Manager
for all purposes herein shall be deemed to be an independent
contractor and shall have no authority to act for or represent
the LLC or the Portfolios in any way or otherwise be deemed an
agent of the LLC or the Portfolios.
B. The LLC shall furnish or otherwise make available to the Manager
such information relating to the business affairs of the
Portfolios as the Manager at any time or from time to time
reasonably requests in order to discharge its obligations
hereunder.
C. This Agreement shall be governed by and construed in accordance
with the laws of The Commonwealth of Massachusetts and shall
inure to the benefit of the parties hereto and their respective
successors.
D. If any provision of this Agreement shall be held or made invalid
or by any court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
14. Limitation of Liability. A copy of the Certificate of Organization of
the LLC is on file with the Secretary of the Commonwealth of
Massachusetts, and notice is hereby given that this Agreement is
executed by an officer of the LLC on behalf of the Trustees of the LLC,
as trustees and not individually, on further behalf of each Portfolio,
and that the obligations of this Agreement with respect to a Portfolio
shall be binding upon the assets and properties of that Portfolio only
and shall not be binding upon the assets and properties of any other
Portfolio or series of the LLC or upon any of the Trustees, officers,
employees, agents or shareholders of the Portfolios or the LLC
individually.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below as of the date first above-written.
WM STRATEGIC ASSET MANAGEMENT PORTFOLIOS, LLC,
on behalf of its portfolios
INCOME PORTFOLIO,
FLEXIBLE INCOME PORTFOLIO,
BALANCED PORTFOLIO,
CONSERVATIVE GROWTH PORTFOLIO, and
STRATEGIC GROWTH PORTFOLIO
By: ____________________________________
Xxxxxxx X. Xxxxxx, President
Attest:
By: _________________________
Xxxx X. Xxxx, Secretary
WM ADVISORS, INC.
By: ___________________________
Xxxxxxx X. Xxxxxx, President
Attest:
By:__________________________
Xxxxxx X. Xxxxxxx, Secretary
Schedule A
WM STRATEGIC ASSET MANAGEMENT PORTFOLIOS, LLC
The management fee to be charged for advisory services (including
sub-advisory fees, if any) for each Portfolio is based upon a percentage of the
average daily net assets of such Portfolio. The total management fee to be paid
monthly for each Portfolio is as follows:
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PORTFOLIO FEE
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Conservative Balanced Portfolio Monthly fee computed on the average daily net
Balanced Portfolio assets of the Portfolio equal to .65% per annum on
Conservative Growth Portfolio the first $1 billion of assets; .60% on the next $2
Strategic Growth Portfolio billion of assets and .55% per annum on assets in
Flexible Income Portfolio excess of $3 billion.
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