Exhibit (d)(3)(9)
INVESTMENT SUB-ADVISORY AGREEMENT
THE SMALL CAP GROWTH FUND OF WM VARIABLE TRUST
EFFECTIVE AS OF APRIL 1, 2005
This Investment Sub-Advisory Agreement is made and entered into as of this
first day of April, 2005, among WM Advisors, Inc. ("WM Advisors"), a corporation
organized under the laws of the state of Xxxxxxxxxx, XX Variable Trust, a
business trust formed under the laws of the Commonwealth of Massachusetts (the
"Trust"), on behalf of its Small Cap Growth Fund series (the "Fund"), and
Oberweis Asset Management, Inc. (the "Sub-Advisor"), a corporation organized
under the laws of the state of Illinois.
Whereas, the Trust is an open-end, management investment company and is so
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
Whereas, the Trust offers a number of investment portfolios, each with
its own investment objective and strategies, and of which one investment
portfolio is the Fund;
Whereas, WM Advisors is engaged in the business of rendering investment
advisory and management services, is registered as an investment adviser under
the Investment Advisers Act of 1940, as amended (the "Advisers Act"), and is the
investment advisor of the Fund;
Whereas, the Sub-Advisor is engaged in the business of rendering
investment advisory and management services and is registered as an investment
adviser under the Advisers Act; and
Whereas, WM Advisors desires to retain the Sub-Advisor to furnish
investment sub-advisory and management services to the Fund and the Sub-Advisor
is willing to furnish such services;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, it is hereby agreed by and between the parties hereto as follows:
1. Investment Description; Appointment
WM Advisors desires to employ such portion of the capital of the Fund as may
from time to time be determined by WM Advisors by investing and reinvesting in
investments of the kind and in accordance with the limitations specified in the
Trust's Master Trust Agreement, as amended, the Bylaws, as amended, and in the
Prospectus and Statement of Additional Information relating to the Fund as in
effect and which may be amended from time to time, and in such manner and to
such extent as may from time to time be approved by the Board of Trustees of the
Trust. Copies of the Fund's Prospectus and Statement of Additional Information,
Bylaws, and the Trust's Master Trust Agreement, each as amended, have been
submitted to the Sub-Advisor. WM Advisors agrees to provide copies of all
amendments or supplements to the Fund's Prospectus and Statement of Additional
Information, Bylaws, and the Trust's Master Trust Agreement to the Sub-Advisor
during the continuance of this Agreement before or at the time such amendments
or supplements become effective provided, however, that if any such amendment or
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supplement relates to the Sub-Advisor or may reasonably be expected to
materially affect the Sub-Advisor's duties or obligations under this Agreement,
WM Advisors agrees to provide copies of such amendment or supplement prior to
its effectiveness. WM Advisors agrees to furnish the Sub-Advisor with
resolutions approved by the Board of Trustees of the Trust to the extent they
may affect the duties of the Sub-Advisor, a certified copy of any financial
statements or reports prepared for the Fund by the Trust's independent
registered public accountants, and with copies of any financial statements or
reports made by the Fund to its shareholders or to any governmental body or
securities exchange, and any further materials or information which the
Sub-Advisor may reasonably request to enable it to perform the services
hereunder. WM Advisors desires to employ and hereby appoints the Sub-Advisor to
act as investment sub-adviser to the portion of the Fund allocated to the
Sub-Advisor by WM Advisors from time to time. The Sub-Advisor accepts the
appointment and agrees to furnish the services described herein for the
compensation set forth below.
2. Services as Investment Sub-Advisor
Subject to the supervision of the Board of Trustees of the Trust and of WM
Advisors, the Fund's investment adviser, the Sub-Advisor will, solely with
respect to the portion of the Fund allocated to the Sub-Advisor by WM Advisors,
(a) maintain and implement compliance procedures that are reasonably designed to
ensure its compliance with the applicable provisions of the Trust's Master Trust
Agreement, and to prevent violations of the "Federal Securities Laws" (as
defined in Rule 38a-1 under the 0000 Xxx); (b) make investment decisions in
accordance with the Fund's investment objectives and policies as stated in the
Fund's Prospectus and Statement of Additional Information as in effect and,
after notice to the Sub-Advisor, and which may be amended from time to time; (c)
place purchase and sale orders on behalf of the Fund to effectuate the
investment decisions made; (d) maintain books and records with respect to the
securities transactions of the Fund in accordance with the 1940 Act and the
Advisers Act and the rules adopted thereunder and furnish to the Trust's Board
of Trustees such quarterly, annual and special reports as the Board may
reasonably request; and (e) except as permitted in this section or elsewhere in
this Agreement treat confidentially and as proprietary information of the Trust,
all records and other information relative to the Trust and to prior, present or
potential shareholders and will not knowingly use or disclose such records and
information for any purpose other than performance of its responsibilities and
duties hereunder, except after prior notification to and approval in writing by
the Trust, which approval shall not be unreasonably withheld and such records
may not be withheld where the Sub-Advisor may be exposed to civil or criminal
contempt proceedings for failure to comply, when requested to divulge such
information by duly constituted authorities, or when so requested by the Trust.
The Sub-Advisor will supervise the Fund's investments and conduct a continuous
program of investment, evaluation and, if appropriate, sale and reinvestment of
the Fund's assets. The Sub-Advisor has responsibility for providing investment
services and advice only with respect to such discrete portion of the Fund as
may from time to time be allocated to the Sub-Advisor by WM Advisors. Subject to
the supervision of WM Advisors and in accordance with the investment objectives
and policies as stated in the Fund's Prospectus and Statement of Additional
Information, the Sub-Advisor is authorized, in its discretion and without prior
consultation with WM Advisors, to buy, sell, lend and otherwise trade in any
stocks, bonds, and other securities and investment instruments on behalf of the
Fund, without regard to the length of time the securities have been held and the
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resulting rate of portfolio turnover or any tax considerations, and so long as
consistent with the Fund's investment objectives and policies, the majority or
the whole of the portion of the Fund may be invested in such proportions of
stocks, bonds, other securities or investment instruments, or cash as the
Sub-Advisor shall determine. In addition, the Sub-Advisor will furnish the Fund
or WM Advisors with whatever statistical information the Fund or WM Advisors may
reasonably request with respect to the investments that the Fund may hold or
contemplate purchasing in the portion of the Fund under the Sub-Advisor's
management. The Sub-Advisor will not consult with any other sub-advisors of any
other funds within the Trust (or any sub-advisors with respect to any other
portion of the Fund) concerning the transactions in securities or other assets
of the Fund or any other funds of the Trust other than for purposes of complying
with the conditions of paragraphs (a) and (b) of Rule 12d3-1 under the 1940 Act.
The Sub-Advisor agrees to comply with the requirements of the 1940 Act, the
Advisers Act, the Securities Act of 1933, the Securities Exchange Act of 1934,
as amended (the "1934 Act"), the Commodity Exchange Act and the respective rules
and regulations thereunder, to the extent applicable, as well as with all other
applicable federal and state laws, rules, regulations and case law that relate
to the services and relationships described hereunder and to the conduct of its
business as a registered investment adviser. No supervisory activity undertaken
by WM Advisors shall limit the Sub-Advisor's full responsibility for any of the
foregoing.
3. Brokerage
Subject to (a) the over-riding objective of obtaining the best possible
execution of orders; and (b) review and approval of the Board of Trustees of the
Trust, which may be conducted as often as the Trustees of the Trust may
determine, the Sub-Advisor shall place all orders for the purchase and sale of
securities for the Fund with brokers or dealers selected by the Sub-Advisor,
which may include brokers or dealers affiliated with the Sub-Advisor. All
transactions with any affiliated person of the Trust, or where any such
affiliated person acts as broker or agent in connection with any such
transaction, shall be accomplished in compliance with the 1940 Act, the Advisers
Act, the 1934 Act, as amended, the rules adopted thereunder and the procedures
adopted thereunder by the Trust. Purchase or sell orders for the Fund may be
aggregated with contemporaneous purchase or sell orders of other clients of the
Sub-Advisor; provided that (a) no advisory account will be favored by the
Sub-Advisor over any other account; (b) each client of the Sub-Advisor who
participates in such an aggregated order will participate at the average share
price, with all transaction costs shared on a pro rata basis; (c) only advisory
clients' transactions will be aggregated for such an aggregated order; and (d)
the accounts of clients whose orders are aggregated will be segregated on the
Sub-Advisor's books and records so as to identify the particular client who has
the beneficial interest therein. The Sub-Advisor shall use its best efforts to
obtain execution of Fund transactions at prices which are advantageous to the
Fund and at commission rates that are reasonable in relation to the benefits
received. However, the Sub-Advisor may select brokers or dealers on the basis
that they provide brokerage, research, or other services or products to the Fund
and/or other accounts serviced by the Sub-Advisor. The Sub-Advisor may pay a
broker or dealer an amount of commission for effecting a securities transaction
in excess of the amount of commission or dealer spread another broker or dealer
would have charged for effecting that transaction if the Sub-Advisor determines
in good faith that such amount of commission was reasonable in relation to the
value of the brokerage and research products and/or services provided by such
broker or dealer. This determination, with
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respect to brokerage and research services or products, may be viewed in terms
of either that particular transaction or the overall responsibilities which the
Sub-Advisor and its affiliates have with respect to the Fund and to accounts
over which they exercise investment discretion, and not all such services or
products may be used by the Sub-Advisor in managing the Fund; provided that with
respect to such transaction and such determination the affiliates of the
Sub-Advisor shall have the same responsibilities to the Fund as the Sub-Advisor
has under this Agreement. Notwithstanding the forgoing, the Sub-Advisor may not
compensate a broker or dealer (including a government securities or municipal
securities broker or dealer) for any promotion or sale of shares of any
investment company, including the Fund, by directing to the broker or dealer the
Fund's portfolio securities transactions or any remuneration, including but not
limited to any commission, xxxx-up, xxxx-down, or other fee (or portion thereof)
received or to be received from the Fund's portfolio transactions effected
through a broker or dealer.
4. Information Provided to the Trust and WM Advisors
The Sub-Advisor will keep the Trust and WM Advisors informed of
developments materially affecting the Fund of which the Sub-Advisor becomes
aware and will, on its own initiative, furnish the Trust and WM Advisors on at
least a quarterly basis with whatever information the Sub-Advisor believes is
appropriate for this purpose. Further, the Sub-Advisor shall notify WM Advisors
immediately upon detection of (a) any material failure to manage the Fund in
accordance with its investment objectives and policies or any applicable law; or
(b) any material breach of any of the Fund's or the Sub-Advisor's policies,
guidelines or procedures.
5. Standard of Care
The Sub-Advisor shall exercise its best judgment in rendering the services
described in paragraphs 2-4 above. Except as may otherwise be provided by
federal securities laws, the Sub-Advisor shall not be liable for any error of
judgment or mistake of law or for any loss suffered by the Fund 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 (the conduct excepted in this sentence shall be
referred to as "Disqualifying Conduct").
6. Compensation
In consideration of the services rendered pursuant to this Agreement, the
Trust, on behalf of the Fund, will pay the Sub-Advisor on the first business day
of each month a fee for the previous month according to the schedule of fees
detailed in Annex A attached to this Agreement. Upon any termination of this
Agreement before the end of a month, the fee for such part of that month shall
be prorated according to the proportion that such period bears to the full
monthly period and shall be payable upon the date of termination of this
Agreement. For the purpose of determining fees payable to the Sub-Advisor, the
value of the Fund's net assets under management by the Sub-Advisor shall be
computed at the times and in the manner specified in the Fund's Prospectus or
Statement of Additional Information relating to the Fund as from time to time in
effect.
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7. Expenses
The Sub-Advisor will bear all of its expenses in performing its services
under this Agreement, which expenses shall not include brokerage fees or
commissions in connection with the effectuation of securities transactions. The
Sub-Advisor shall not be required to bear any expenses of the Trust, the Fund or
WM Advisors. The Trust will bear certain other expenses to be incurred in its
operation, including but not limited to: organizational expenses, taxes,
interest, brokerage fees and commissions, if any; fees of trustees of the Trust
who are not officers, directors or employees of the Sub-Advisor, WM Advisors, or
any of their affiliates; Securities and Exchange Commission fees and state Blue
Sky qualification fees; all fees, including out-of-pocket expenses of
custodians, transfer and dividend disbursing agents and transaction charges of
custodians; insurance premiums; outside auditing and legal expenses; costs of
maintenance of the Trust's existence; costs attributable to investor services,
including without limitation, telephone and personnel expenses; costs of
preparing and printing prospectuses and statements of additional information for
regulatory purposes and for distribution to existing shareholders; costs of
shareholders' reports and meetings of the shareholders of the Fund and of the
officers or Board of Trustees of the Trust; and any extraordinary expenses. In
addition, the Fund pays a distribution fee pursuant to the terms of a
Distribution Plan adopted under Rule 12b-1 of the 1940 Act. Any reimbursement of
investment advisory fees required by any expense limitation provision shall be
the sole responsibility of WM Advisors.
8. Services to Other Companies or Accounts
WM Advisors understands that the Sub-Advisor now acts, will continue to
act and may act in the future as investment adviser to fiduciary and other
managed accounts and as investment adviser to one or more other investment
companies or series of investment companies, and WM Advisors has no objection to
the Sub-Advisor so acting, provided that whenever the Fund and one or more other
accounts or investment companies advised by the Sub-Advisor have available funds
for investment, investments suitable and appropriate for each will be allocated
in accordance with procedures reasonably believed to be equitable to each
entity. Similarly, opportunities to sell securities will be allocated in an
equitable manner. WM Advisors recognizes that in some cases this procedure may
limit the size of the position that may be acquired or disposed of for the Fund.
In addition, WM Advisors understands that the persons employed by the
Sub-Advisor to assist in the performance of the Sub-Advisor's duties hereunder
will not devote their full time to such service and nothing contained herein
shall be deemed to limit or restrict the right of the Sub-Advisor or any
affiliate of the Sub-Advisor to engage in and devote time and attention to other
business or to render services of whatever kind or nature. WM Advisors
recognizes and agrees that the Sub-Advisor may provide advice to other clients
which may differ from or be identical to advice given with respect to the Fund.
9. Term of Agreement
This Agreement shall become effective as of the date first written above,
shall continue for a period of two years thereafter, and shall continue in
effect for a period of more than two years thereafter only so long as such
continuance is specifically approved at least annually by (a) the Board of
Trustees of the Trust or (b) a vote of a "majority" (as defined in the 0000 Xxx)
of the Fund's outstanding voting securities, provided that in either event the
continuance is also
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approved by a majority of the Board of 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. This
Agreement is terminable, without penalty, on 30 days' written notice, by WM
Advisors, the Board of Trustees for the Trust or by vote of holders of a
majority of the Fund's shares, or upon 60 days' written notice by the
Sub-Advisor and will terminate automatically upon any termination of the
advisory agreement between the Trust and WM Advisors. In addition, this
Agreement will also terminate automatically in the event of its assignment (as
defined in the 1940 Act). The Sub-Advisor agrees to notify the Trust of any
circumstances that, to its best knowledge and belief, might result in this
Agreement being deemed to be assigned.
10. Representations of WM Advisors and the Sub-Advisor
WM Advisors represents that (a) a copy of the Trust's Master Trust
Agreement, dated February 22, 1989, together with all amendments thereto, is on
file in the office of the Secretary of the Commonwealth of Massachusetts, (b)
the appointment of the Sub-Advisor has been duly authorized, (c) it has acted
and will continue to act in conformity with the 1940 Act and other applicable
laws, and (d) it is authorized to perform the services herein.
The Sub-Advisor represents that it is authorized to perform the services
described herein. Further, the Sub-Advisor represents that it maintains errors
and omissions insurance coverage in an appropriate amount and shall provide
prior written notice to WM Advisors (a) of any material changes in its insurance
policies or insurance coverage; or (b) if any material claims will be made on
its insurance policies. Furthermore, the Sub-Advisor shall upon reasonable
request provide WM Advisors any information it may reasonably require concerning
the amount of or scope of such insurance.
11. Indemnification
WM Advisors shall indemnify and hold harmless the Sub-Advisor from and
against any and all claims, losses, liabilities or damages (including reasonable
attorneys' fees and other related expenses), howsoever arising from or in
connection with this Agreement or the performance by the Sub-Advisor of its
duties hereunder; provided, however, that nothing contained herein shall require
that the Sub-Advisor be indemnified for Disqualifying Conduct.
Sub-Advisor shall indemnify and hold harmless WM Advisors and the Fund
from and against any and all claims, losses, liabilities or damages (including
reasonable attorneys' fees and other related expenses), howsoever arising from
or in connection with this Agreement attributable to Disqualifying Conduct.
12. Amendment of this Agreement
No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against which enforcement of the change, waiver, discharge or termination is
sought.
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13. Indemnification Use of Names
The parties agree and acknowledge that the Sub-Advisor is the sole owner
of the name and xxxx "Oberweis" and that all use of any designation comprised in
whole or part of Oberweis (a "Sub-Advisor Xxxx") under this Agreement shall
inure to the benefit of the Sub-Advisor. The use by the Trust on its own behalf
or on behalf of the Fund of any Sub-Advisor Xxxx in any advertisement or sales
literature or other materials promoting the Fund shall be with the consent of
the Sub-Advisor. The Trust and WM Advisors shall not, without the consent of the
Sub-Advisor, make representations regarding the Sub-Advisor intended to be
disseminated to the investing public in any disclosure document, advertisement
or sales literature or other materials promoting the Fund. Such consent shall
not be required for any documents or other materials intended for broker-dealer
use only, for use by the Trust's trustees and for internal use by the Trust and
WM Advisors. Consent by the Sub-Advisor to such use of any Sub-Advisor Xxxx and
any such representation shall not be unreasonably withheld and shall be deemed
to be given if no written objection is received by the Trust, the Fund or WM
Advisors within 3 business days after the request is made by the Trust, the Fund
or WM Advisors for such use of any Sub-Advisor Xxxx or any such representation.
Upon termination of this Agreement for any reason, the Trust and WM Advisors
shall cease all use of any Sub-Advisor Xxxx(s) as soon as reasonably
practicable.
The Sub-Advisor agrees and acknowledges that the Trust is the sole owner
of the name and xxxx "WM Variable Trust" and WM Advisors is the sole owner of
the name and xxxx "WM Advisors, Inc." and that any and all use of any
designation comprised in whole or in part of "WM Variable Trust" or "WM
Advisors, Inc." (each a "WM Xxxx") under this Agreement shall inure to the
benefit of the Trust or WM Advisors, respectively. The use by the Sub-Advisor on
its own behalf of any WM Xxxx in any advertisement or sales literature or other
materials promoting the Sub-Advisor shall be with the consent of the Trust or WM
Advisors, respectively. The Sub-Advisor shall not, without the consent of the
Trust or WM Advisors, as applicable, make representations regarding the Trust,
the Fund or WM Advisors in any disclosure document, advertisement or sales
literature or other materials promoting the Sub-Advisor. Consent by the Trust
and WM Advisors to such use of any WM Xxxx and any such representations shall
not be unreasonably withheld and shall be deemed to be given if no written
objection is received by the Sub-Advisor within 5 business days after the
request by the Sub-Advisor is made for such use of any WM Xxxx or any such
representations. Upon termination of this Agreement for any reason, the Sub-
Advisor shall cease any and all use of any WM Xxxx as soon as reasonably
practicable.
14. Declaration of Trust and Limitation of Liability
A copy of the Master Trust Agreement 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, as an officer
and not individually, on behalf of the Trustees of the Trust, as trustees and
not individually, on further behalf of the Fund, and that the obligations of
this Agreement with respect to the 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 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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15. Entire Agreement; Amendment of Management Agreement
This Agreement constitutes the entire agreement among the parties hereto,
except that WM Advisors and the Trust are also parties to an Investment
Management Agreement relating to the Fund dated May 11, 2004 as Amended and
Restated (the "Management Agreement").
The Trust and WM Advisors hereby amend the Management Agreement, for so
long as this Agreement shall remain in effect, to provide that: (a) The Trust,
on behalf of the Fund, shall pay to WM Advisors a monthly fee equal to the
excess, if any, of (i) the fee set forth in Section 5 of the Management
Agreement (the "Management Fee") over (ii) the fee paid by the Fund under this
Agreement or any other sub-advisory agreement with respect to the Fund; (b) WM
Advisors shall not be entitled to any other fees under the Management Agreement
with respect to the Fund; (c) The Trust acknowledges and agrees that, for so
long as Sub-Advisor meets the standard of care set forth in this Agreement, WM
Advisors shall have no obligation to (i) furnish a continuous investment program
for the Fund, (ii) determine from time to time what securities will be
purchased, retained or sold by the Fund, and what portion of the Fund's assets
will be held as cash, or (iii) place orders for the purchase and sale of
portfolio securities for the Fund with brokers or dealers selected by WM
Advisors; (d) Notwithstanding this Agreement, WM Advisors remains authorized to
determine what securities or other property shall be purchased or sold by or for
the Fund; (e) In exchange for the fee paid by the Fund under the Management
Agreement and in recognition of its obligation to select and monitor the
Sub-Advisor, and not for the services provided by the Sub-Advisor pursuant to
the Sub-Advisory Agreement, WM Advisors shall indemnify and hold the Trust
harmless from and against any and all claims, costs, expenses (including
attorneys' fees), losses, damages, charges, payments and liabilities of any sort
or kind which may be asserted against the Trust or for which the Trust may be
held liable arising out of or attributable to any actual or alleged failure of
Sub-Advisor to meet the standard of care set forth in this Agreement.
16. Governing Law
This Agreement shall be governed in accordance with the laws of The
Commonwealth of Massachusetts. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms or provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction.
17. Miscellaneous
(a) Unless WM Advisors or the Trust gives the Sub-Advisor written
instructions to the contrary, the Sub-Advisor shall vote all proxies solicited
by or with respect to the issuers of securities in which assets of the portion
of the Fund under the Sub-Advisor's management may be invested. The Sub-Advisor
shall use its best good faith judgment to vote such proxies in a manner which
best serves the interests of the Fund's shareholders.
(b) WM Advisors shall provide the Sub-Advisor with a copy of the Fund's
agreement (the "Custody Agreement") with the custodian (the "Custodian")
designated to hold the assets of
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the Fund and any modification thereto in advance. The Fund's assets shall be
maintained in the custody of the Custodian identified in, and in accordance with
the terms and conditions of, the Custody Agreement. The Sub-Advisor shall have
no liability for the acts or omissions of the Custodian. Any assets added to the
portion of the Fund to be managed by the Sub-Advisor shall be delivered directly
to the Custodian. WM Advisors shall instruct the Fund's Custodian and other
appropriate parties to promptly forward proxies related to securities within the
portion of the Fund managed by the Sub-Advisor to the Sub-Advisor, and the
Sub-Advisor shall have no liability for failing to vote the proxy for an issuer
when it has not received the proxy statement for that issuer. The Sub-Advisor
shall under no circumstances act as custodian for the Fund.
(c) The Sub-Advisor may perform its services through any employee, officer
or agent of the Sub-Advisor, and the Trust and the Fund shall not be entitled to
the advice, recommendation, or judgment of any specific person.
(d) In the performance of its duties hereunder, the Sub-Advisor 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 WM Advisors in any way or otherwise be deemed
to be an agent of the Fund, the Trust, or WM Advisors. If any occasion should
arise in which the Sub-Advisor gives any advice to its clients concerning the
shares of the Fund, the Sub-Advisor will act solely as investment counsel for
such clients and not in any way on behalf of the Fund.
(e) The headings of paragraphs contained in this Agreement are provided
for convenience only, form no part of this Agreement and shall not affect its
construction.
(f) This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
(g) WM Advisors and the Trust's Board of Trustees understand that the
value of investments made for the Fund may go up as well as down, is not
guaranteed and that investment decisions will not always be profitable. The
Sub-Advisor has not made and is not making any guarantees, including any
guarantee as to any specific level of performance of the Fund. WM Advisors and
the Trust's Board of Trustees acknowledge that the Fund is designed for the
described investment objective and is not intended as a complete investment
program. They also understand that investment decisions made on behalf of the
Fund by the Sub-Adviser are subject to various market and business risks.
(h) All written notices, requests or other communications to any party
hereunder shall be given to the following addresses and telecopy numbers, or
such other address and telecopy number communicated to the other parties from
time to time:
If to WM Advisors, Inc. to: Xxxxx X. Xxx
0000 Xxxxx Xxxxxx 00xx Xxxxx Xxxxxxx, XX 00000
If to the Fund, to: Attn: X.X. Xxxxxxxxx of Ropes & Xxxx LLC
Xxx Xxxxxxxxxxxxx Xxxxx Xxxxxx, XX 00000-0000
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If to the Sub-Advisor, to: Attn: Xxxxx X. Xxxxxxxx
000 Xxx Xxxxx Xxxxx, Xxxxx 000 Xxxxx Xxxxxx, XX 00000
(i) The Sub-Advisor is permitted to include the performance of the portion
of the Fund managed by the Sub-Advisor in calculating the performance of its
composites and identify the Fund to third parties as a client; provided, that
the Sub-Advisor shall indemnify the Fund and WM Advisors, Inc. for any liability
that results from such use.
18. Confidential Information
"Confidential Information" of any party shall mean ideas, expressions,
trade secrets, customer lists, products, policies, forms, business methods,
business plans, software and information from third parties (such as software
and its related documentation) for which such party has a duty of
confidentiality, as well as information which from all relevant circumstances
should reasonably be assumed by a party to be confidential information, whether
any of which is marked "Confidential Information" or not. Each party will make
reasonable effort to advise each other party when information disclosed to that
other party is Confidential Information. Confidential Information relating to a
party shall be held in confidence by each other party to the same extent and in
at least the same manner as such party protects its own Confidential
Information, but in no case to a lesser extent or manner than a reasonable
degree of care under the circumstances. Confidential Information shall not be
disclosed to third parties without specific written permission of the protected
party. Each party shall, however, be permitted to disclose relevant aspects of
each other party's Confidential Information to its officers, agents,
subcontractors and employees to the extent that such disclosure is reasonably
necessary for the performance of its duties and obligations under this
Agreement; provided, however, that such party shall take all reasonable measures
to ensure that Confidential Information of the other party is not disclosed or
duplicated in contravention of the provisions of the Agreement by such officers,
agents, sub contractors, and employees.
The obligations in this Section 18 shall not restrict any disclosure by
any party pursuant to any applicable state or federal laws, or by order of any
court or government agency (provided that the disclosing party shall give prompt
notice to the non-disclosing party of such order) and shall not apply with
respect to information which (1) is independently developed by the other party
without violating the disclosing party's proprietary rights, (2) is or becomes
publicly known (other than through unauthorized disclosure), (3) is
intentionally disclosed by the owner of such information to a third party free
of any obligation of confidentiality, (4) is already known by such party without
an obligation of confidentiality other than pursuant to this Agreement or of any
confidentiality agreements entered into before the effective date of this
Agreement as evidenced by the written records of such party, or (5) is
rightfully received by a party free of any obligation of confidentiality.
The parties agree that they shall abide by the provisions of the
Xxxxx-Xxxxx-Xxxxxx Act ("GLB") and other applicable privacy laws and shall each
establish commercially reasonable controls to ensure the confidentiality of the
Confidential Information and to ensure that the Confidential Information is not
disclosed contrary to the provisions of this Agreement, GLB or any other
applicable privacy laws and regulations. Without limiting the foregoing, each
party
Page 10 of 12
shall implement such physical and other security measures as are necessary to
(i) ensure the security and confidentiality of the Confidential Information (ii)
protect against any threats or hazards to the security and integrity of the
Confidential Information and (iii) protect against any unauthorized access to or
use of the Confidential Information. To the extent that any duties and
responsibilities under the Agreement are delegated to an agent or other
subcontractor, the party shall take reasonable steps to ensure that such agents
and subcontractor adhere to the same requirements. Each party shall have the
right, during regular office hours and upon reasonable notice, to audit the
other party to ensure compliance with the terms of this Agreement, GLB and other
privacy laws and regulations.
Notwithstanding the foregoing, the provisions of this Section 18 shall
impose no obligations on the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first written above.
WM ADVISORS, INC. WM VARIABLE TRUST, on behalf of its
Small Cap Growth Fund series
By_____________________________ By________________________
Name: Xxxxxxx X. Xxxxxx Name: Xxxx X. Xxxx
Title: President Title: First Vice President
OBERWEIS ASSET MANAGEMENT, INC.
By________________________ Dated: April 1, 2005
Name: Xxxxx X. Xxxxxxxx
Title: President
Page 11 of 12
ANNEX A
1. For purposes of calculating the fee to be paid to the Sub-Advisor
under this Agreement:
"Fund Assets" shall mean the net assets of the portion of the Fund
managed by the Sub-Advisor;
"Other Assets" shall mean the net assets of the portion of the Growth Fund
series of WM Trust managed by the Sub-Advisor.
"Combined Assets" shall mean the sum of Fund Assets and Other Assets;
and
"Average Daily Net Fund Assets," "Average Daily Net Other Assets" and
"Average Daily Net Combined Assets" shall mean the average of the value of
the Fund Assets, Other Assets or Combined Assets, as the case may be, on
each business day.
2. The Sub-Advisor fee shall be paid in arrears (within 10 days of end of
month) based upon the Average Daily Net Combined Assets during the preceding
month. The fee payable for the month shall be calculated by applying the annual
rate, as set forth in the fee schedule below, to the Average Daily Net Combined
Assets, and dividing by twelve. The portion of the monthly fee to be paid by the
Fund shall be prorated based upon the Average Daily Net Fund Assets as compared
to the Average Daily Net Combined Assets. For a month in which this Agreement
becomes effective or terminates, the portion of the Sub-Advisor fee due
hereunder shall be prorated on the basis of the number of days that the
Agreement is in effect during the month.
3. The following fee schedule shall be used to calculate the fee to be
paid to the Sub-Advisor under this Agreement:
First Next Over
$250 $250 $500
Million Million Million
------- ------- -------
0.60% 0.50% 0.40%
Page 12 of 12
