EXHIBIT 99.(d)(3)
EXCESS EXPENSE AGREEMENT
WHEREAS, PowerShares Capital Management LLC is the investment adviser (the
"Adviser") of the PowerShares Exchange-Traded Fund Trust (the "Trust");
WHEREAS, the Adviser proposes to waive fees and/or absorb certain expenses
of one or more portfolios of the Trust (each a "Fund") in order to maintain
expense ratios of the Funds at or below a predetermined level (each an "Expense
Cap"); and
WHEREAS, the Trust desires to induce the Adviser to waive fees and/or
absorb expenses of the Funds to the extent necessary to maintain the expense
ratios of the Funds at or below their applicable Expense Caps.
NOW, THEREFORE, the parties hereto agree as follows:
1. Subject to the limitations specified below, each Fund shall reimburse
the Adviser, without interest, for fees waived and/or expenses absorbed by
the Adviser on or after October 4, 2004, for the purpose of maintaining the
Fund's expense ratio at or below its Expense Cap (the "Reimbursement
Payments"). The Expense Cap for each Fund and the period of time it will
remain in effect is set forth in Appendix I attached hereto, as it may be
amended from time to time.
2. The Adviser shall be entitled to Reimbursement Payments from a Fund on
the earliest date that any such payments may be made without thereby causing
the Fund to (i) exceed its Expense Cap then in effect, or (ii) if the Expense
Cap is no longer in effect, exceed an expense ratio equal to the most recent
applicable Expense Cap (the "Maximum Expense Level"), but shall have no right
to any Reimbursement Payments from a Fund to the extent any such payment
would result in the Fund exceeding its Expense Cap or Maximum Expense Level.
3. A Fund's obligation to make Reimbursement Payments with respect to any
particular fees waived, and/or expenses absorbed, shall expire five years
from the date the fee or expense would otherwise have been accrued by the
Fund.
4. This Agreement may be terminated by the Trust or the Adviser, without
penalty, upon 60 days prior written notice.
5. The Adviser shall, upon termination of the Agreement, have no claim
against the Trust or any Fund for any unreimbursed amounts.
POWERSHARES EXCHANGE-TRADED
FUND TRUST
By:
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POWERSHARES CAPITAL MANAGEMENT
LLC
By:
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APPENDIX I
POWERSHARES PRODUCTS
Dynamic Large Cap Growth Portfolio
Dynamic Consumer Electronics Portfolio
Dynamic Large Cap Value Portfolio
Dynamic Mid Cap Growth Portfolio
Dynamic Mid Cap Value Portfolio
Dynamic Small Cap Growth Portfolio
Dynamic Small Cap Value Portfolio
Dynamic Aerospace & Defense Portfolio
Dynamic Biotechnology & Genome Portfolio
Dynamic Leisure and Entertainment Portfolio
Dynamic Food & Beverage Portfolio
Dynamic Hardware Portfolio
Dynamic Brand Name Products Portfolio
Dynamic Internet Software & Services Portfolio
Dynamic Media Portfolio
Dynamic Networking Portfolio
Dynamic Pharmaceuticals Portfolio
Dynamic Semiconductors Portfolio
Dynamic Software Portfolio
Dynamic Telecommunication Services Portfolio
Dynamic Wireless Portfolio
Halter Golden Dragon China Portfolio
WilderHill Clean Energy Portfolio
High Yield Equity Dividend Achievers Portfolio
Zacks Rank Large Cap Portfolio
Value Line Timeliness and Safety Portfolio
