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Exhibit (h)(3)(A)
WM STRATEGIC ASSET MANAGEMENT PORTFOLIOS, LLC
ADMINISTRATION AGREEMENT
______ __, 1999
WM Shareholder Services, Inc.
0000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, XX 00000
Ladies and Gentlemen:
WM Strategic Asset Management Portfolios, LLC (the "LLC"), a limited
liability company organized under the laws of the Commonwealth of Massachusetts,
confirms its agreement with WM Shareholder Services, Inc. ("WMSS"), a
corporation organized under the laws of the State of Washington, regarding
administration services to be provided by WMSS in connection with each of the
investment portfolios offered from time to time by the LLC (individually, a
"Portfolio" and together, the "Portfolios"). WMSS agrees to provide services
upon the following terms and conditions:
1. Investment Description: Appointment
The LLC desires to employ the LLC's capital by investing and
reinvesting (a) in investments of the kind, and in accordance with the
limitations, specified in (i) the LLC's LLC Operating Agreement dated March 12,
1999, as amended (the "LLC Agreement"), and (ii) the prospectus(es) (the
"Prospectus") and statement(s) of additional information (the "Statement")
relating to the Portfolios contained in the LLC's Registration Statement on Form
N-1A filed with the Securities and Exchange Commission (the "Registration
Statement") and (b) in such manner and to such extent as may from time to time
be approved by the LLC's Board of Trustees. Copies of the Prospectus, the
Statement and the LLC Agreement have been submitted to WMSS. The LLC desires to
employ and hereby appoints WMSS to act as the Portfolios' administrator. WMSS
accepts this appointment and agrees to furnish the services described herein for
the compensation set forth below.
2. Services as Administrator
Subject to the supervision and direction of the Board of Trustees of
the LLC, WMSS is responsible for all administrative functions with respect to
the LLC and will (a) assist in supervising all aspects of the operations of the
LLC except those performed by the LLC's
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investment adviser under its investment advisory agreement; (b) supply the LLC
with office facilities (which may be in WMSS'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
WMSS 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 WMSS of its responsibilities hereunder. Notwithstanding
anything to the contrary in this Agreement, WMSS shall not be responsible for
the performance of any duties which are required to be performed by the LLC's
transfer agent.
3. Compensation
a. In consideration of services rendered pursuant to this Agreement,
the LLC will pay WMSS on the first business day of each month a fee for the
previous month at an annual rate of 0.50% of the average daily net assets of
each Portfolio; out of which fee WMSS shall pay expenses as described in
Paragraph 4 including, without limitation, fees to any sub-administrator and the
LLC's custodian. The fee for the period from the date of this Agreement to the
end of the first calendar month of the term of this Agreement shall be prorated
according to the proportion that such period bears to the full monthly period.
b. Upon any termination of this Agreement before the end of any month,
the fee for such part of a month shall be prorated according to the proportion
which 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 WMSS, the value of each Portfolio's net assets shall be computed at
the times and in the manner specified in the Prospectus and/or the Statement
relating to the Portfolio as from time to time in effect.
4. Expenses
WMSS will bear all expenses in connection with the performance of its
services under this Agreement, including, without limitation, payment of the fee
to any sub-administrator and custodian described in Paragraph 2 above. The LLC
will bear certain other expenses to be incurred in its operation, including:
organizational expenses; taxes, interest, brokerage fees and commissions, if
any; fees of trustees of the LLC who are not officers, directors, or employees
of WM Advisors, Inc., each sub-administrator or any of their affiliates;
transfer agent fees; federal regulatory fees and state Blue Sky fees;
out-of-pocket expenses of custodians, transfer
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and dividend disbursing agents and the LLC's sub-administrator and transaction
charges of custodians; insurance premiums; outside auditing and legal expenses;
costs of maintenance of the LLC'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 LLC and of the
officers Board of Trustees of the LLC; and any extraordinary expenses. In
addition, each Portfolio pays a distribution fee pursuant to terms of a
Distribution Plan adopted under Rule 12b-1 of the Investment Company Act of 1940
(the "1940 Act").
5. Standard of Care
WMSS shall exercise its best judgment in rendering the services listed
in Paragraph 2 above. WMSS 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.
6. Term of Agreement
This Agreement shall become effective as of the date set forth above
and shall continue for an initial two-year term and shall continue automatically
from year-to-year thereafter unless terminated in accordance with the following
sentence. This Agreement is terminable at any time, without penalty, on 60 days'
written notice by the Board of Trustees of the LLC, or upon 90 days' written
notice by WMSS.
7. Service to Other Companies or Accounts
The LLC understands that WMSS may act in the future as administrator to
other investment companies or series of investment companies, and the LLC has no
objection to WMSS's so acting in such capacity. The LLC understands that the
persons employed by WMSS to assist in the performance of WMSS's duties under
this Agreement will not devote their full time to such service and nothing
contained in this Agreement shall be deemed to limit or restrict the right of
WMSS or any affiliate of WMSS to engage in and devote time and attention to
other businesses or to render services of whatever kind or nature.
8. Representations of the LLC and WMSS
The LLC represents that (a) a copy of the LLC Agreement is on file in
the office of the Secretary of The Commonwealth of Massachusetts, (b) the
appointment of WMSS has been duly authorized and (c) it has acted and will
continue to act in conformity with the 1940 Act and
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other applicable laws WMSS represents that it is authorized to perform the
services described herein
9. Limitation of Liability
A copy of the Certificate of Formation 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.
10. Entire Agreement
This Agreement constitutes the entire agreement between the parties
hereto.
11. Governing Law
This Agreement shall be governed in accordance with the laws of the
Commonwealth of Massachusetts.
If the foregoing accurately sets forth our agreement, kindly indicate
your acceptance hereof by signing and returning the enclosed copy hereof.
Very truly yours,
WM STRATEGIC ASSET
MANAGEMENT PORTFOLIOS, LLC
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Name: Xxxxxxx X. Xxxxxx
Title: President
Accepted:
WM SHAREHOLDER SERVICES, INC.
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Name: Xxxxxxx X. Xxxxxx
Title: President
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