Form of agreement subject to completion
THIRD AMENDED AND RESTATED
INVESTMENT ADVISORY AGREEMENT
E*TRADE FUNDS ("TRUST")
AGREEMENT, dated as of September [ ], 2006 between E*TRADE Asset
Management, Inc. ("Adviser") and E*TRADE Funds ("Trust") on behalf of each
series listed on the attached Exhibit A as such Exhibit may be amended from
time to time (each series is hereinafter referred to as a "Fund").
WHEREAS, the Trust is a Delaware statutory trust organized pursuant to a
Trust Instrument dated November 4, 1998, as amended from time to time ("Trust
Instrument"), and is registered under the Investment Company Act of 1940, as
amended ("1940 Act"), as an open-end management investment company, and each
Fund is a series of the Trust; and
WHEREAS, the Adviser is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended ("Advisers Act");
WHEREAS, the Trust has retained the Adviser to render investment advisory
services to the Trust, on behalf of each Fund, pursuant to prior Investment
Advisory Agreements entered into from time to time;
WHEREAS, the Trust wishes to continue to retain the Adviser to render
investment advisory services to each Fund, and the Trust and Adviser desire to
amend the prior investment advisory agreements between the parties.
NOW THEREFORE, in consideration of the promises and mutual covenants herein
contained, it is agreed between the Trust and the Adviser as follows:
1. Appointment. The Trust hereby appoints the Adviser to act as investment
adviser to each Fund subject to the supervision of the Trustees of the Trust,
and for the periods and in the manner and on the terms and conditions set forth
in this Agreement. The Adviser accepts such appointment for the compensation
herein provided and agrees to furnish the services and to assume the
obligations set forth in this Agreement commencing on its effective date.
2. Investment Advisory Duties.
(a) Subject to the supervision of the Board of Trustees of the Trust, the
Adviser:
(i) will have overall supervisory responsibility for the general
management and investment of each Fund's assets and will provide a program of
continuous investment management for each Fund in accordance with each Fund's
investment objective, policies and limitations as stated in each Fund's
Prospectus and Statement of Additional Information included as part of the
Trust's Registration Statement filed with the Securities and Exchange Commission
("SEC") and as the Prospectus and Statement of Additional Information may be
amended or otherwise supplemented from time to time, copies of which shall be
provided to the Adviser by the Trust;
(ii) may, at its own expense (and subject to approval by the Board of
Trustees and the investment objective, policies and limitations set forth in
each Fund's Prospectus and Statement of Additional Information) select and
contract with one or more investment sub-advisers (each a "Sub-Adviser"), who
may be granted discretionary investment authority for all or a portion of the
portfolio of any Fund, or materially modify or terminate any sub-advisory
agreement; provided, that any sub-advisory agreement with a Sub-Adviser shall
be in compliance with and approved as required by the 1940 Act or in accordance
with exemptive relief granted by the SEC under the 1940 Act;
(iii) will have full investment discretion to make all determinations
with respect to the investment of a Fund's assets not then managed by a
Sub-Adviser. In connection with the Adviser's responsibilities herein, the
Adviser will assess each Fund's investment focus and will seek to implement
decisions with respect to the allocation and reallocation of each Fund's assets
among one or more current or new Sub-Advisers from time to time, as the Adviser
deems appropriate, to enable each Fund to achieve its investment goals. In
addition, the Adviser will monitor compliance of each Sub-Adviser with the
investment objectives, policies and restrictions of any Fund (or portion of any
Fund) under the management of such Sub-Adviser, and review and report to the
Board of Trustees of the Trust on the performance of each Sub-Adviser;
(iv) will furnish, or cause the appropriate Sub-Adviser(s) to furnish,
to the Trust such statistical information with respect to the assets or
investments that a Fund (or portions of any Fund) may hold or contemplate
purchasing as the Trust may reasonably request;
(v) will apprise, or cause the appropriate Sub-Adviser(s) to apprise,
the Trust of important developments materially affecting any Fund (or any
portion of a Fund) that they advise and furnish the Trust, from time to time,
with such information as may be appropriate for this purpose; and
(vi) will furnish, or cause the appropriate Sub-Adviser(s) to furnish,
to the Trustees of the Trust such periodic and special reports as the Trustees
of the Trust may reasonably request. In addition, the Adviser agrees, and
agrees to cause the appropriate Sub-Adviser(s), to furnish to the Board of
Trustees of the Trust third-party data reporting services all currently
available standardized performance information and other customary data.
(b) In performing its investment management services to each Fund hereunder,
the Adviser will provide each Fund with ongoing investment guidance, policy
direction, including oral and written research, monitoring of all sub-advised
portions of each Fund, analysis, advice, statistical and economic data and
judgments regarding individual investments, general economic conditions and
trends and long-range investment policy.
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(c) Subject to the approval of the Board of Trustees of the Trust, the
Adviser shall have the authority to manage cash and money market instruments
for cash flow purposes.
(d) The Adviser will advise as to the securities, instruments, repurchase
agreements, options and other investments and techniques that each Fund will
purchase, sell, enter into or use, and will provide an ongoing evaluation of
each Fund's portfolio. The Adviser will advise as to what portion of each
Fund's portfolio shall be invested in securities and other assets, and what
portion if any, should be held uninvested.
(f) The Adviser further agrees that, in performing its duties hereunder, it
will, and that the Sub-Advisory Agreements it enters into with any Sub-Adviser
shall require that the Sub-Adviser will:
(i) comply with the 1940 Act and all rules and regulations thereunder,
the Advisers Act, the Internal Revenue Code ("Code") and all other applicable
federal and state laws and regulations, and with any applicable procedures
adopted by the Trustees. The Adviser also will provide, and will cause the
Sub-Advisers to provide, to the Trust such information and assurances
(including sub-certifications) as the Trust may reasonably request from time to
time in order for the Trust to comply with its disclosure and reporting
obligations imposed under applicable federal laws and regulations;
(ii) use reasonable efforts to manage each Fund so that it will qualify,
and continue to qualify, as a regulated investment company under Subchapter M
of the Code and regulations issued thereunder;
(iii) place orders for the purchase and sale of investment for each Fund
directly with the issuer or with any broker or dealer in accordance with
(I) each Fund's investment objectives and investment program and all applicable
policies and procedures described in each Fund's Prospectus and/or Statement of
Additional Information, (II) any written policies and procedures adopted by the
Trust regarding the such matters, and (III) with all applicable legal
requirements;
(iv) make available to the Trust's administrator ("Administrator"), any
sub-administrator ("Sub-Administrator") and the Trust, promptly upon their
request, such copies of its investment records and ledgers with respect to each
Fund as may be required to assist the Administrator, the Sub-Administrator and
the Trust in their compliance with applicable laws and regulations. The Adviser
will furnish the Trustees with such periodic and special reports regarding each
Fund and any Sub-Adviser as they may reasonably request;
(v) immediately notify the Trust in the event that the Adviser or any of
its affiliates, or any Sub-Adviser or any of its affiliates: (I) becomes aware
that it is subject to a statutory disqualification that prevents the Adviser or
Sub-Adviser from serving as investment adviser pursuant to this Agreement or a
Sub-Advisory Agreement; or (II) becomes aware that it is the subject of an
administrative proceeding or enforcement action by the SEC or other regulatory
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authority. The Adviser further agrees to notify the Trust immediately of any
material fact known to the Adviser respecting or relating to the Adviser or any
Sub-Adviser or any their affiliates that is not contained in the Trust's
Registration Statement regarding each Fund, or any amendment or supplement
thereto, but that is required to be disclosed thereon, and of any statement
contained therein that becomes untrue in any material respect; and
(vi) in providing investment advice to each Fund, use no inside
information that may be in its possession or in the possession of any of its
affiliates, nor will the Adviser or any Sub-Adviser seek to obtain any such
information.
(g) will promptly notify the Trust in writing of the occurrence of any of
the following events:
(i) the Adviser or a Sub-Adviser fails to be registered as an investment
adviser under the Advisers Act or under the laws of any jurisdiction in which
Adviser or such Sub-Adviser is required to be registered as an investment
adviser in order to perform its obligations under this Agreement;
(ii) the Adviser or a Sub-Adviser is served or otherwise receives notice
of any action, suit, proceeding, inquiry or investigation, at law or in equity,
before or by any court, public board or body, involving the affairs of the
Trust; and/or
(iii) the chief executive officer or controlling stockholder (or
partners) of the Adviser or any Sub-Adviser or the portfolio manager of any
Fund changes or there is otherwise an actual change in control or management of
Adviser.
3. Futures and Options. The Adviser's investment authority shall include
advice with regard to purchasing, selling, or covering open positions, and
generally dealing in financial futures contracts and options thereon, or master
funds which do so in accordance with those rule and regulations of the
Commodity Futures Trading Commission ("CFTC") applicable to registered
investment companies and their investment advisers.
The Adviser's authority shall include authority to: (i) open and
maintain brokerage accounts for financial futures and options (such accounts
hereinafter referred to as "Brokerage Accounts") on behalf of and in the name
of each Fund; and (ii) execute for and on behalf of the Brokerage Accounts,
standard customer agreements with any broker or dealer. The Adviser may, using
such of the securities and other property in the Brokerage Accounts as the
Adviser deems necessary or desirable, direct the custodian to deposit on behalf
of each Fund, original and maintenance brokerage deposits and otherwise direct
payments of cash, cash equivalents and securities and other property into such
brokerage accounts and to such brokers as the Adviser deems desirable or
appropriate.
4. Section 11 of the Securities Exchange Act of 1934, as amended. The Trust
hereby agrees that any entity or person associated with Adviser that is a
member of a national securities
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exchange is authorized to effect any transaction on such exchange for the
account of a Fund to the extent and as permitted by Section 11(a)(1)(H) of the
Securities Exchange Act of 1934, as amended ("1934 Act").
5. Brokerage Transactions. The Adviser will, as appropriate, select
broker-dealers to execute portfolio transactions for the Funds and will monitor
each Sub-Adviser's selection and use of broker-dealers to execute portfolio
transactions for the Funds. All purchase and sale orders will be placed with
broker-dealers who are selected by the Adviser or the Sub-Adviser as able to
provide "best execution" of such orders for the Funds. "Best execution" shall
mean prompt and reliable execution at the most favorable securities price,
taking into account the other provisions hereinafter set forth. Whenever the
Adviser places orders, or directs the placement of orders, for the purchase or
sale of portfolio securities on behalf of each Fund, in selecting brokers or
dealers to execute such orders, the Adviser is expressly authorized to consider
the fact that a broker or dealer has furnished statistical, research or other
information or services that may enhance the Adviser's research and portfolio
management capability generally. It is further understood in accordance with
Section 28(e) of 1934 Act that the Adviser may use a broker whose commissions
on transactions may exceed the commissions that another broker would have
charged for effecting the transactions, provided that the Adviser determines in
good faith that the amount of commission charged was reasonable in relation to
the value of brokerage and/or research services (as defined in Section 28(e))
provided by such broker, viewed in terms either of each Fund or the Adviser's
overall responsibilities to the Adviser's discretionary accounts.
6. Directed Brokerage. Subject to the requirement to seek best price and
execution, and to the appropriate policies and procedures approved by the Board
of Trustees, the Trust reserves the right to direct the Adviser to cause
Sub-Advisers to effect transactions in portfolio securities through
broker-dealers in a manner that will help generate resources to: (i) pay the
cost of certain expenses which the Trust is required to pay or for which the
Trust is required to arrange payment pursuant to Section 7(b) of this Agreement
("Trust Expenses"); or (ii) finance activities that are primarily intended to
result in the sale of Fund shares. At the discretion of the Trustees of the
Trust, such resources may be used to pay or cause the payment of Trust Expenses
or may be used to finance activities that are primarily intended to result in
the sale of Fund shares.
7. Allocation of Charges and Expenses.
(a) Except as otherwise specifically provided in this Section 7, the Adviser
shall pay the compensation and expenses of all of its directors, officers and
employees who serve as trustees, officers and executive employees of the Trust
(including the Trust's share of payroll taxes), and the Adviser shall make
available, without expense to each Fund, the service of its directors, officers
and employees who may be duly elected officers of the Trust, subject to their
individual consent to serve and to any limitations imposed by law.
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(b) The Adviser shall not be required to pay pursuant to this Agreement any
expenses of each Fund other than those specifically allocated to the Adviser in
this Section 7. In particular, but without limiting the generality of the
foregoing, the Adviser shall not be responsible, except to the extent of the
reasonable compensation of such of the Trust's employees as are officers or
employees of the Adviser whose services may be involved, for the following
expenses of each Fund: organization and certain offering expenses of each Fund
(including out-of-pocket expenses, but not including the Adviser's overhead and
employee costs); fees payable to the Adviser and to any other Fund advisers or
consultants; legal expenses; auditing and accounting expenses; interest
expenses; telephone, telex, facsimile, postage and other communications
expenses; taxes and governmental fees; fees, dues and expenses incurred by or
with respect to each Fund in connection with membership in investment company
trade organizations; cost of insurance relating to fidelity coverage for the
Trust's officers and employees; fees and expenses of each Fund's Administrator,
Sub-Administrator and Fund Accounting Agent or of any custodian, subcustodian,
transfer agent, registrar, or dividend disbursing agent of each Fund; the
expenses of any master fund in which any Fund invests; payments to the
Administrator, Sub-Administrator or Fund Accounting Agent for maintaining each
Fund's financial books and records and calculating its daily net asset value;
other payments for portfolio pricing or valuation services to pricing agents,
accountants, bankers and other specialists, if any; expenses of preparing share
certificates; other expenses in connection with the issuance, offering,
distribution or sale of securities issued by each Fund; expenses relating to
investor and public relations; expenses of registering and qualifying shares of
each Fund for sale; freight, insurance and other charges in connection with the
shipment of each Fund's portfolio securities; brokerage commissions or other
costs of acquiring or disposing of any portfolio securities or other assets of
each Fund, or of entering into other transactions or engaging in any investment
practices with respect to each Fund; expenses of printing and distributing
prospectuses, Statements of Additional Information, reports, notices and
dividends to stockholders; costs of stationery or other office supplies; any
litigation expenses; costs of stockholders' and other meetings; the
compensation and all expenses (specifically including travel expenses relating
to each Fund's business) of officers, Trustees and employees of the Trust who
are not interested persons of the Adviser; and travel expenses (or an
appropriate portion thereof) of officers or Trustees of the Trust who are
officers, directors or employees of the Adviser to the extent that such
expenses relate to attendance at meetings of the Board of Trustees of the Trust
with respect to matters concerning each Fund, or any committees thereof or
advisers thereto.
8. Compensation.
(a) As compensation for the services provided and expenses assumed by the
Adviser under this Agreement, the Trust will arrange for each Fund to pay the
Adviser at the end of each calendar month an advisory fee computed daily at an
annual rate equal to the amount of average daily net assets listed opposite
each Fund's name in Exhibit A, attached hereto. The "average daily net assets"
of each Fund shall mean the average of the values placed on each Fund's net
assets as of 4:00 p.m. (New York time) on each day on which the net asset value
of each Fund is
6
determined consistent with the provisions of Rule 22c-1 under the 1940 Act or,
if each Fund lawfully determines the value of its net assets as of some other
time on each business day, as of such other time. The value of net assets of
each Fund shall always be determined pursuant to the applicable provisions of
the Trust Instrument and the Registration Statement. If, pursuant to such
provisions, the determination of net asset value is suspended for any
particular business day, then for the purposes of this Section 8, the value of
the net assets of each Fund as last determined shall be deemed to be the value
of its net assets as of the close of the New York Stock Exchange, or as of such
other time as the value of the net assets of each Fund's portfolio may lawfully
be determined, on that day. If the determination of the net asset value of the
shares of each Fund has been so suspended for a period including any month end
when the Adviser's compensation is payable pursuant to this Section 8, then the
Adviser's compensation payable at the end of such month shall be computed on
the basis of the value of the net assets of each Fund as last determined
(whether during or prior to such month). If each Fund determines the value of
the net assets of its portfolio more than once on any day, then the last such
determination thereof on that day shall be deemed to be the sole determination
thereof on that day for the purposes of this Section 8.
(b) The Adviser shall reduce its compensation pursuant to this Section 8 by
any Rule 12b-1 fees, service fees or revenue sharing payments that the Adviser
or any of its affiliates receive from any underlying fund in which a Fund
invests.
(c) The Adviser shall be solely responsible for compensating any Sub-Adviser
for performing any of the duties and obligations delegated to such Sub-Adviser,
provided that the Adviser may request that the Trust directly pay to the
Sub-Adviser the portion of the Adviser's compensation that the Adviser is
obligated to pay to the Sub-Adviser. If the Trust agrees to such request, the
compensation the Trust pays to the Adviser shall be reduced by amounts paid
directly to any Sub-Adviser.
9. Books and Records. The Adviser agrees to maintain, and to cause each
Sub-Adviser to maintain, such books and records with respect to its services to
each Fund as are required by 1940 Act and the Advisers Act and the rules and
regulations adopted thereunder, and by other applicable legal provisions, and
to preserve such records for the periods and in the manner required by the 1940
Act, the Advisers Act and the rules, regulations and legal provisions
thereunder. The Adviser also agrees, and shall cause each Sub-Adviser to agree,
that records the Adviser or any Sub-Adviser maintains and preserves pursuant to
Rules 31a-1 and 31a-2 under the 1940 Act and Rule 204-2(c)(2) under the
Advisers Act and otherwise in connection with its services under this Agreement
are the property of the Trust and will be surrendered promptly to the Trust
upon its request. The Adviser further agrees that it will furnish, and will
cause each Sub-Adviser to furnish, to regulatory authorities having the
requisite authority any information or reports in connection with its services
hereunder or under any Sub-Advisory Agreement which may be requested in order
to determine whether the operations of each Fund are being conducted in
accordance with applicable laws and regulations.
7
10. Aggregation of Orders. Provided that the investment objective, policies
and restrictions of each Fund are adhered to, the Trust agrees that the Adviser
may aggregate sales and purchase orders of securities held in each Fund with
similar orders being made simultaneously for other accounts managed by the
Adviser or with accounts of the affiliates of the Adviser, if in the Adviser's
reasonable judgment such aggregation shall result in an overall economic
benefit to the respective Fund taking into consideration the advantageous
selling or purchase price, brokerage commission and other expenses. The Trust
acknowledges that the determination of such economic benefit to each Fund by
the Adviser represents the Adviser's evaluation that each Fund is benefited by
relatively better purchase or sales prices, lower commission expenses and
beneficial timing of transactions or a combination of these and other factors.
11. Standard of Care and Limitation of Liability. The Adviser shall exercise
its best judgment in rendering the services provided by it under this
Agreement. The Adviser shall not be liable for any error of judgment or mistake
of law or for any loss suffered by each Fund or the holders of each Fund's
shares in connection with the matters to which this Agreement relates, provided
that nothing in this Agreement shall be deemed to protect or purport to protect
the Adviser against any liability to the Trust, each Fund or to holders of each
Fund's shares to which the Adviser would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or by reason of the Adviser's reckless disregard of
its obligations and duties under this Agreement or otherwise for breach of this
Agreement. As used in this Section 11, the term "Adviser" shall include any
officers, directors, employees or other affiliates of the Adviser performing
services with respect to each Fund. Notwithstanding any other provision of this
Agreement, the Adviser shall not be liable for any loss to each Fund caused
directly or indirectly by circumstances beyond the Adviser's reasonable control
including, but not limited to, government restrictions, exchange or market
rulings, suspensions of trading, acts of civil or military authority, national
emergencies, earthquakes, floods or other catastrophes, acts of God, wars or
failures of communication or power supply.
12. Services Not Exclusive. It is understood that the services of the
Adviser are not exclusive, and that nothing in this Agreement shall prevent the
Adviser from providing similar services to other investment companies or to
other series of investment companies, including the Trust (whether or not their
investment objectives and policies are similar to those of each Fund) or from
engaging in other activities, provided such other services and activities do
not, during the term of this Agreement, interfere in a material manner with the
Adviser's ability to meet its obligations to each Fund hereunder. When the
Adviser recommends the purchase or sale of a security for other investment
companies and other clients, and at the same time the Adviser recommends the
purchase or sale of the same security for each Fund, it is understood that in
light of its fiduciary duty to each Fund, such transactions will be executed on
a basis that is fair and equitable to each Fund. In connection with purchases
or sales of portfolio securities for the account of each Fund, neither the
Adviser nor any of its directors, officers or employees shall act as a
principal or agent or receive any commission. If the Adviser provides any
advice to its
8
clients concerning the shares of each Fund, the Adviser shall act solely as
investment counsel for such clients and not in any way on behalf of the Trust
or each Fund.
13. Duration and Termination.
(a) This Agreement shall continue for a period of two years from the date of
commencement of such Fund as listed on Exhibit A hereto, and thereafter shall
continue automatically for successive annual periods, provided such continuance
is specifically approved at least annually by (i) the Trustees or (ii) a vote
of a "majority" (as defined in the 0000 Xxx) of each Fund's outstanding voting
securities (as defined in the 1940 Act), provided that in either event the
continuance is also approved by a majority of the Trustees who are not parties
to this Agreement or "interested persons" (as defined in the 0000 Xxx) of any
party to this Agreement, by vote cast in person (to the extent required by the
0000 Xxx) at a meeting called for the purpose of voting on such approval.
(b) Notwithstanding the foregoing, this Agreement may be terminated: (i) at
any time without penalty by each Fund upon the vote of a majority of the
Trustees or by vote of the majority of each Fund's outstanding voting
securities, upon sixty (60) days' written notice to the Adviser or (ii) by the
Adviser at any time without penalty, upon sixty (60) days' written notice to
the Trust. This Agreement will also terminate automatically in the event of its
assignment (as defined in the 1940 Act).
14. Amendments. This Agreement may be amended at any time but only by the
mutual written agreement of the parties to this Agreement and in accordance
with any applicable legal or regulatory requirements. Except to the extent
permitted by the 1940 Act or the rules or regulations thereunder or pursuant to
any exemptive relief granted by the SEC, this Agreement may be amended by the
parties only if such amendment, if material, is specifically approved by the
vote of a majority of the outstanding voting securities of each of the Funds
affected by the amendment (unless such approval is not required by Section 15
of the 1940 Act as interpreted by the SEC or its staff) and by the vote of a
majority of the Independent Trustees of the Trust cast in person at a meeting
called for the purpose of voting on such approval. The required shareholder
approval shall be effective with respect to any Fund if a majority of the
outstanding voting securities of that Fund vote to approve the amendment,
notwithstanding that the amendment may not have been approved by a majority of
the outstanding voting securities of (a) any other Fund affected by the
amendment or (b) all the Funds of the Trust.
15. Proxies. Unless the Trust gives written instructions to the contrary,
the Adviser shall vote all proxies solicited by or with respect to the issuers
of securities in which assets of each Fund may be invested in a manner which
best serves the interests of each Fund's shareholders and in compliance with
the Trust's proxy voting policies and procedures.
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16. Use of "E*TRADE" Name.
(a) It is understood (including by any Sub-Adviser) that the name "E*TRADE"
and any logo associated with that name, is the valuable property of E*TRADE
Group, Inc., and that the Trust and Adviser have the right to include "E*TRADE"
as a part of their name only so long as this Agreement shall continue in effect
and the Adviser is a wholly owned subsidiary of the E*TRADE Group, Inc.
Further, the Trust and the Adviser agree that: (i) they will use the name
"E*TRADE" only as a component of the names of the Trust, each Fund and the
Adviser, and for no other purposes; (ii) neither will purport to grant to any
third party any rights in the name "E*TRADE"; (iii) at the request of E*TRADE
Group, Inc., the Trust or the Adviser take such action as may be required to
provide their consent to use of the name "E*TRADE" by E*TRADE Group, Inc. or
any affiliate of E*TRADE Group, Inc., to whom E*TRADE Group, Inc. shall have
granted the right to such use; and (iv) E*TRADE Group, Inc. may use or grant to
others the right to use the name "E*TRADE", or any abbreviation thereof, as all
or a portion of a corporate or business name or for any commercial purpose,
including a grant of such right to any other investment company.
(b) Upon termination of this Agreement as to the Trust or its Fund, the
Trust and the Adviser shall, upon request of E*TRADE Group, Inc., cease to use
the name "E*TRADE" as part of the name of the Trust, each Fund or the Adviser,
as applicable. In the event of any such request by E*TRADE Group, Inc. that use
of the name "E*TRADE" shall cease, the Trust and the Adviser shall cause their
officers, trustees, directors and stockholders to take any and all such actions
which E*TRADE Group, Inc. may request to effect such request and to reconvey to
E*TRADE Group, Inc. any and all rights to the name "E*TRADE."
17. Notice. All notices required to be given pursuant to this Agreement
shall be delivered or mailed to the last known business address of the Trust or
Adviser in person or by registered mail or a private mail or delivery service
providing the sender with notice of receipt. Notice shall be deemed given on
the date delivered or mailed in accordance with this Section.
18. Miscellaneous.
(a) This Agreement shall be governed by the laws of the State of California
without regard to the conflicts of law provisions thereof, provided that
nothing herein shall be construed in a manner inconsistent with the 1940 Act,
the Advisers Act, or rules or orders of the SEC thereunder.
(b) The captions of this Agreement are included for convenience only and in
no way define or limit any of the provisions hereof or otherwise affect their
construction or effect.
(c) If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected hereby and, to this extent, the provisions of this
Agreement shall be deemed to be severable.
10
(d) Nothing herein shall be construed as constituting the Adviser as an
agent of the Trust or each Fund.
(e) All liabilities of the Trust hereunder are limited to the assets of each
Fund and shall not be binding upon any Trustee, officer or shareholder of the
Trust individually or upon any other series of the Trust.
(f) This Agreement contains the entire understanding and agreement of the
parties.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of September [ ], 2006.
E*TRADE FUNDS
By:
-----------------------------
Name:
Title:
E*TRADE ASSET MANAGEMENT, INC.
By:
-----------------------------
Name:
Title:
11
EXHIBIT A
Name of Fund Advisory Fee Date of Commencement
------------ ------------ --------------------
E*TRADE Delphi Value Fund [ ]% September [ ], 2006
E*TRADE International Index Fund 0.25% November 10, 2003
E*TRADE Kobren Growth Fund [ ]% September [ ], 2006
E*TRADE Xxxxxxx 2000 Index Fund 0.15% November 10, 2003
E*TRADE S&P 500 Index Fund 0.07% November 10, 2003
E*TRADE Technology Index Fund 0.25% September 15, 2003
12
