Exhibit 6(a)
DISTRIBUTION CONTRACT
THIS DISTRIBUTION CONTRACT (this "Agreement"), dated this 20th day of
March, 1998, between WM Trust I, a Massachusetts business trust (the "Trust"),
on behalf of each of its series which are listed on the signature page of this
Agreement (each a "Fund"), and WM Funds Distributor, Inc., a Washington
corporation doing business at Sacramento, California, Washington, herein
sometimes referred to as the "Distributor."
RECITALS
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WHEREAS, the Trust is registered as an open-end, management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act")
and the Funds are separate series of the Trust;
WHEREAS, each Fund and the Distributor desire to enter into an agreement
that sets forth standard terms and conditions for distribution and other
services for Class A, Class B and Class S shares of each Fund;
NOW, THEREFORE, in consideration of the mutual covenants herein contained
and other good and valuable consideration the receipt of which is hereby
acknowledged, the parties hereto agree as follows:
APPOINTMENT. The Trust hereby affirms the appointment of WM Funds
Distributor, Inc. as the agent for distribution of shares for each Fund and
grants Distributor the right to sell Class A, Class B and Class S shares on
behalf of the Fund and on terms set forth in this Agreement. The
Distributor accepts such appointment and agrees to render the services
herein set forth for the payments herein provided (including reimbursement
of expenses).
DELIVERY OF DOCUMENTS. The Trust and/or each Fund has furnished
the Distributor with copies of:
Agreement and Declaration of Trust and all amendments
thereto for the Trust (as amended from time to time, the "Declaration
of Trust");
Bylaws and all amendments thereto for the Trust (as amended
from time to time, the "Bylaws"); and
Each Fund's registration statement, prospectus and statement
of additional information, then in effect (the "Registration
Statement")
under the Securities Act of 1933, as amended (the "1933 Act") and the
1940 Act.
From time to time, each Fund will furnish the Distributor with current
copies of all amendments or supplements to the foregoing, if any, and all
documents, notices and reports filed with the Securities and Exchange Commission
(the "SEC") and will make available, upon request, evidence of payment of
registration fees imposed from time to time by the States in which securities of
each Fund are sold by the Distributor.
DUTIES OF THE DISTRIBUTOR. The Distributor shall provide each Fund
with the benefit of its best judgment, efforts and facilities in rendering
its services as Distributor. The Distributor will act as the exclusive
Distributor of the Class A, Class B and Class S shares of each Fund,
subject to the supervision of the Trust's Board of Trustees and the
following understandings: the Trust's Board of Trustees shall be
responsible for and control the conduct of each Fund's affairs; in all
matters relating to the performance of this Agreement, the Distributor will
act in conformity with the Declaration of Trust and Bylaws of the Trust and
the Registration Statement of each Fund and with the instructions and
directions of the Trust's Board of Trustees; the Distributor will conform
to and comply with applicable requirements of the 1940 Act, the 1933 Act
and all other applicable federal or state laws and regulations. In carrying
out its obligations hereunder, the Distributor shall:
Provide to the Trust's Board of Trustees, at least quarterly, a
written report of the amounts expended in connection with all
distribution services rendered pursuant to this Agreement, including
an explanation of the purposes for which such expenditures were made;
and
Take, on behalf of each Fund, all actions which appear to be
necessary to carry into effect the distribution of each Fund's shares
as provided in paragraph 4.
DISTRIBUTION OF SHARES. It is mutually understood and agreed that the
Distributor does not undertake to sell all or any specific portion of the
Class A, Class B or Class S shares of any Fund. Distributor shall have the
right to enter into sales agreements with dealers of its choice for the
sale of the Class A, Class B or Class S shares of each Fund to the public
at the public offering price. Distributor shall set forth in such
agreements the portion of the sales charge which may be retained by such
dealers. If any Fund determines that it is necessary to file the form of
dealer agreement and amendments thereto as an exhibit to its currently
effective Registration Statement under the 1933 Act, then the Distributor
shall provide the Fund with currently effective documents. A Fund shall not
sell
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any of its Class A, Class B or Class S shares except through the
Distributor. Notwithstanding the provisions of the foregoing sentence:
A Fund may issue its Class A, Class B or Class S shares at their
net asset value to any shareholder of the Fund purchasing such shares
with dividends or other cash distributions received from the Fund
pursuant to any special or continuing offer made to shareholders;
The Distributor may, and when requested by a Fund, shall, suspend
its efforts to effectuate sales of the Class A, Class B or Class S
shares of a Fund at any time when in the opinion of the Distributor or
of the Fund no sales should be made because of a need to revise a
Registration Statement, or because of market or other economic
considerations or abnormal circumstances of any kind. Either party in
its sole discretion may reject orders for the purchase of such shares;
A Fund may withdraw the offering of its Class A, Class B or Class
S shares at any time with the consent of the Distributor or 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;
The price at which the Class A, Class B or Class S shares will be
sold to investors (the "offering price") shall be the net asset value
per share, determined in accordance with the provisions of the Fund's
current Registration Statement, plus a sales charge determined in the
amount and manner established from time to time by the Distributor and
set forth in a Fund's current prospectus. The Fund shall receive the
net asset value per share for the sale of its Class A, Class B or
Class S shares;
If a sales charge is in effect, the Distributor shall have the
right, subject to such rules or regulations of the Securities and
Exchange Commission as may then be in effect pursuant to Section 22 of
the 1940 Act, to pay a portion of the sales charge to dealers who have
sold Class A, Class B or Class S shares of the Fund in accordance with
provisions of dealer agreements; and
The Distributor is not authorized by any Fund to provide any
information or to make any representations other than those contained
in the appropriate Registration Statements, or contained in
shareholder reports or other material that may be prepared by or on
behalf of a Fund for Distributor's use. This shall not be construed to
prevent the Distributor
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from preparing and distributing sales literature or other material as
it may deem appropriate.
COMPENSATION FOR SERVICING SHAREHOLDER ACCOUNTS. As compensation for
its services hereunder, the Distributor shall be entitled to receive all
front-end loads and contingent deferred sales charges as may be described
from time to time in the Registration Statement. The Fund also shall pay a
distribution fee to the Distributor at an annual rate as shall be
authorized by the shareholders and further set by the Board of Trustees
pursuant to the provisions of the Trust's Distribution Plans for Class A,
Class B and Class S shares, then in effect, in accordance with Rule 12b-1
under the 1940 Act (the "Distribution Plans"). The Trust acknowledges that
the Distributor and its dealers may compensate their investment
representatives for opening accounts, processing investors' purchase and
redemption orders, responding to inquiries from Fund shareholders
concerning the status of their accounts and the operations of a Fund, and
communicating with a Fund and its transfer agent on behalf of Fund
shareholders in such manner and amount as the Distributor may deem
appropriate.
EXPENSES. The expenses connected with distribution shall be allocable
between the Funds and the Distributor as follows:
The Distributor shall furnish the services of personnel to the
extent that such services are required to carry out its obligations
under this Agreement.
Each Fund assumes and shall pay or cause to be paid the following
expenses incurred on its behalf:
Registration of shares including the expense of printing and
distributing prospectuses to existing shareholders; expenses incurred
for maintaining the Trust's or Fund's existence, taxes and expenses
related to portfolio transactions; charges and expenses of any
registrar, custodian or depository for portfolio securities and other
property, and any stock transfer, dividend or account agent or agents;
all taxes, including securities issuance and transfer taxes, and fees
payable to federal, state or other governmental agencies; costs and
expenses in connection with the registration and maintenance of
registration of a Fund and its shares with the SEC and various states
and other jurisdictions (including filing fees, legal fees and
disbursements of counsel); expenses of shareholders' and directors'
meetings and preparing, printing, and mailing of proxy statements and
reports to shareholders; fees and travel expenses of directors who are
not "interested persons" as that term is defined in the 1940 Act;
expenses incident to the payment of any dividend, distribution,
withdrawal
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or redemption, whether in shares or in cash; charges and
expenses of any outside service used for pricing of a Fund's shares;
fees and expenses of legal counsel and of independent accountants;
membership dues of industry associations; postage (excluding postage
for promotional and sales literature); insurance premiums on property
of personnel (including, but not limited to legal claims and
liabilities and litigation costs and any indemnification related
thereto); and all other charges and costs of a Fund's operation unless
otherwise explicitly provided herein.
The Distributor will bear all expenses incurred in connection
with its performance of the services described herein and the
incurring of distribution expenses under this Agreement. For purposes
of this Agreement, "distribution expenses" of the Distributor shall
mean all expenses borne by the Distributor which represent payment for
activities primarily intended to result in the sale of Class A, Class
B, or Class S shares, including, but not limited to, the expenses of
distribution that are described in the Distribution Plans.
The Distributor will furnish the Board of Trustees statements of
distribution revenues and expenditures at least quarterly with respect
to the Class A, Class B and Class S shares of each Fund as required by
the Distribution Plans for each respective Class.
NON-EXCLUSIVITY. The services of the Distributor are not exclusive and
the Distributor shall be entitled to render distribution or other services
to others (including other investment companies) and to engage in other
activities. It is understood and agreed that officers of the Distributor
may serve as officers or trustees of the Trust, and that officers or
trustees of the Trust may serve as officers of the Distributor to the
extent permitted by law; and that officers of the Distributor are not
prohibited from engaging in any other business activity or from rendering
services to any other person, or from serving as partners, officers or
directors of any other firm or corporation, including other investment
companies and broker/dealers.
TERM AND APPROVAL. This Agreement shall become effective as of the
date first above written for an initial period of two years, and shall
continue in force and effect from year to year thereafter, provided that,
with respect to any Fund or Class, such continuance is specifically
approved at least annually:
By the Trust's Board of Trustees, including the affirmative vote
of a majority of the Board of Trustees of the Trust who are not (i)
parties to this Agreement, (ii) interested persons of any such party
(as
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defined in Section 2(a)(19) of the 1940 Act), or (iii) persons having
a direct or indirect financial interest in the operation of this
Agreement or any agreement related to this Agreement (the "Qualified
Trustees") by votes cast in person at a meeting called for the purpose
of voting on such approval, or
By the vote of a majority of the outstanding voting securities of
the Fund (as defined in Section 2(a)(42) of the 1940 Act).
TERMINATION. This Agreement may be terminated, with respect to any
Fund or Class, at any time, without the payment of any penalty, on sixty
(60) days' written notice, by vote of the Board of Trustees of the Trust,
or by a vote of a majority of the Qualified Trustees, or by a vote of a
majority of the outstanding voting securities of the Fund (as defined in
Section 2(a)(42) of the 1940 Act), or by the Distributor on sixty (60)
days' written notice to the Fund. The notice provided for herein may be
waived by either party. This Agreement shall automatically terminate in the
event of its assignment, the term "assignment" for this purpose having the
meaning set forth in Section (a)(4) of the 1940 Act.
REPRESENTATIONS AND WARRANTIES. The Trust represents and warrants to
the Distributor that any registration statement, prospectus and statement
of additional information, when such Registration Statement becomes
effective, will include all statements required to be contained therein in
conformity with the 1933 Act, the 1940 Act and the rules and regulations of
the SEC; that all statements of fact contained in any registration
statement, prospectus or statement of additional information will be true
and correct when such Registration Statement becomes effective; and that
neither any registration statement nor any prospectus or statement of
additional information when such Registration Statement becomes effective
will include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading to a purchaser of shares. The Distributor
may, but shall not be obligated to, propose from time to time such
amendment or amendments to any registration statement and such supplement
or supplements to any prospectus or statement of additional information as,
in the light of future developments, may, in the opinion of the
Distributor's counsel, be necessary or advisable. If the Trust shall not
propose such amendment or amendments and/or supplement or supplements
within fifteen (15) days after receipt by the Trust of a written request
from the Distributor to do so, the Distributor may, at its option,
terminate this Agreement. The Trust shall not file any amendment to any
registration statement or supplement to any prospectus or statement of
additional information without giving the Distributor reasonable notice
thereof in advance; provided, however, that nothing contained in this
Agreement shall in any way limit the Trust's right to file at any time such
amendments to any registration statement and/or supplements
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to any prospectus or statement of additional information, of whatever
character, as the Trust may deem advisable, such right being in all
respects absolute and unconditional.
AMENDMENTS. This Agreement may be amended, with respect to any
Fund or Class, by the parties hereto only if such amendment is specifically
approved by the Board of Trustees of the Trust or by the vote of majority
of outstanding voting securities of the Fund, and by a majority of the
Qualified Trustees, which vote must be cast in person at a meeting called
for the purpose of voting on such approval; provided, however, that any
such amendment that constitutes an amendment of the Distribution Plans for
any Class of shares of the Fund shall be approved by shareholders pursuant
to Rule 12b-1 to the extent required by applicable law.
INDEMNIFICATION.
12.1 The Trust authorizes the Distributor and any dealers with
whom Distributor has entered into dealer agreements to use any
prospectus or statement of additional information furnished by the
Trust from time to time, in connection with the sale of shares of each
Fund. The Trust agrees to indemnify, defend and hold Distributor, its
several officers and directors, and any person who controls
Distributor within the meaning of Section 15 of the 1933 Act, 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 Distributor, its officers and directors,
or any such controlling person, may incur under the 1933 Act, the 1940
Act or 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, any prospectus or any
statement of additional information, or arising out of or based upon
any omission or alleged omission to state a material fact required to
be stated in any registration statement, any prospectus or any
statement of additional information, or necessary to make the
statements in any of them not misleading; provided, however, that the
Trust's agreement to indemnify the Distributor, its officers or
directors, and any such controlling person shall not be deemed to
cover any claims, demands, liabilities or expenses arising out of or
based upon any statements or representations made by Distributor or
its representatives or agents other than such statements and
representations as are contained in any registration statement,
prospectus or statement of additional information and in such
financial and other statements as are furnished to the Distributor
pursuant to paragraph 2 hereof; and further provided that the Trust's
agreement to indemnify the Distributor and the
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Trust's representations and warranties shall not be deemed to cover
any liability to the Trust or its shareholders to which Distributor
would otherwise be subject by reason of willful misfeasance, bad faith
or gross negligence in the performance of its duties, or by reason of
Distributor' reckless disregard of its obligations and duties under
this Agreement. The Trust's agreement to indemnify Distributor, its
officers and directors, and any such controlling person, as aforesaid,
is expressly conditioned upon the Trust's being notified of any action
brought against Distributor, its officers or directors, or any such
controlling person, such notification to be given by letter or by
telegram addressed to the Trust at its principal office stated herein
and sent to the Trust by the person against whom such action is
brought, within ten (10) days after the summons or other first legal
process shall have been served. The failure so to notify the Trust of
any such action shall not relieve the Trust from any liability that
the Trust may have to the person against whom such action is brought
by reason of any such untrue or alleged untrue statement or omission
or alleged omission otherwise than on account of the Trust's indemnity
agreement contained in this paragraph 12.1. The Trust's
indemnification agreement contained in this paragraph 12.1 and the
Trust's representations and warranties in this Agreement shall remain
operative and in full force and effect regardless of any investigation
made by or on behalf of Distributor, its officers and directors, or
any controlling person, and shall survive the delivery of any shares.
This agreement of indemnity will inure exclusively to Distributor's
benefit, to the benefit of its several officers and directors and
their respective estates, and to the benefit of the controlling
persons and their successors. The Trust agrees to notify Distributor
promptly of the commencement of any litigation or proceedings against
the Trust or any of its officers or trustees in connection with the
issuance and sale of any shares.
12.2 Distributor 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 1933 Act, 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) that the Trust, its officers or trustees or any
such controlling person may incur under the 1933 Act, the 1940 Act or
common law or otherwise, but only to the extent that such liability or
expense incurred by the Trust, its officers or trustees or such
controlling person resulting from such claims or demands shall arise
out of or be based upon (a) any unauthorized sales literature,
advertisements, information, statements or representations or (b) any
untrue or allegedly untrue statement of a material fact contained in
information furnished in writing by the Distributor to the Trust and
used in the answers
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to any of the items of the Registration Statement or in the
corresponding statements made in the prospectus or statement of
additional information, 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 Distributor to the Trust
and required to be stated in such answers or necessary to make such
information not misleading. Distributor's agreement to indemnify the
Trust, its officers and trustees, and any such controlling person, as
aforesaid, is expressly conditioned upon Distributor being notified of
any action brought against the Trust, its officers or trustees, or any
such controlling person, such notification to be given by letter or
telegram addressed to Distributor at its principal office as stated
herein and sent to Distributor by the person against whom such action
is brought, within ten days after the summons or other first legal
process shall have been served. The failure so to notify the
Distributor of any such action shall not relieve Distributor from any
liability that the Distributor may have to the Trust, its officers or
trustees, or to such controlling person by reason of any such untrue
or alleged untrue statement or omission or alleged omission otherwise
than on account of Distributor's indemnity agreement contained in this
paragraph 12.2. The Distributor agrees to notify the Trust promptly of
the commencement of any litigation or proceedings against Distributor
or any of its officers or directors in connection with the issuance
and sale of any shares.
12.3 In case any action shall be brought against any indemnified
party under paragraph 12.1 or 12.2, and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate in, and, to the extent that it shall
wish to do so, to assume the defense thereof with counsel satisfactory
to such indemnified party. If the indemnifying party opts to assume
the defense of such action, the indemnifying party will not be liable
to the indemnified party for any legal or other expenses subsequently
incurred by the indemnified party in connection with the defense
thereof other than (a) reasonable costs of investigation or the
furnishing of documents or witnesses and (b) all reasonable fees and
expenses of separate counsel to such indemnified party if (i) the
indemnifying party and the indemnified party shall have agreed to the
retention of such counsel or (ii) the indemnified party shall have
concluded reasonably that representation of the indemnifying party and
the indemnified party by the same counsel would be inappropriate due
to actual or potential differing interests between them in the conduct
of the defense of such action.
LIABILITY OF THE DISTRIBUTOR. In the performance of its duties
hereunder, the Distributor shall be obligated to exercise care and
diligence
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and to act in good faith and to use its best efforts within reasonable
limits to insure the accuracy of all services performed under this
Agreement, but the Distributor shall not be liable for any act or omission
which does not constitute willful misfeasance, bad faith or gross
negligence on the part of the Distributor or reckless disregard by the
Distributor of its duties under this Agreement.
NOTICES. Any notices under this Agreement shall be in writing,
addressed and delivered or mailed postage paid to the other party at such
address as such other party may designate for the receipt of such notice.
Until further notice to the other party, it is agreed that the address of
each Fund shall be 000 Xxxx Xxxx Xxxxxx, Xxxxx 000, Xxxxxxx, XX 00000, and
the address of the Distributor shall be 000 Xxxx Xxxx Xxxxxx, Xxxxx 000,
Xxxxxxx, XX 00000.
DECLARATION OF TRUST AND LIMITATION OF LIABILITY. A copy of the
Declaration of Trust of the Trust is on file with the Secretary of State of
The Commonwealth of Massachusetts, and notice is hereby given that this
Agreement is executed by an officer of the Trust on behalf of the trustees
of the Trust, as trustees and not individually, on further behalf of each
Fund, and that the obligations of this Agreement with respect to each Fund
shall be binding upon the assets and properties of the Fund only and shall
not be binding upon the assets and properties of any other Fund or series
of the Trust or upon any of the trustees, officers, employees, agents or
shareholders of the Fund or the Trust individually.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective officers on the day and year first
above written.
WM TRUST I, on behalf of its series
BOND & STOCK FUND,
GROWTH & INCOME FUND,
NORTHWEST FUND,
INCOME FUND,
U.S. GOVERNMENT SECURITIES FUND,
TAX-EXEMPT BOND FUND,
MONEY MARKET FUND,
TAX-EXEMPT MONEY MARKET FUND, and
HIGH YIELD FUND
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
President
Attest:
By: /s/ Xxxx X. Xxxx
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Xxxx X. Xxxx
Secretary
WM FUNDS DISTRIBUTOR, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Xxxxxxx X. Xxxxxx
President
Attest:
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
Secretary
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