INVESTMENT SUB-ADVISORY AGREEMENT
E*TRADE FUNDS
AGREEMENT, effective commencing as of September __, 2003 on an interim basis
with respect to only the E*TRADE Technology Index Fund
("Technology Index Fund") and effective commencing as of ______, 2003
("commencement date") with respect to each other series listed on the attached
Exhibit A (each series (including Technology Index Fund) is hereinafter
referred to as a "Fund"), among Munder Capital Management, Inc. ("Munder"), on
behalf of World Asset Management ("Sub-Adviser"), E*TRADE Asset Management,
Inc. ("Adviser") and E*TRADE Funds ("Trust").
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;
WHEREAS, the Sub-Adviser is a division of Munder and Munder 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 an Amended and
Restated Investment Advisory Agreement dated as of _______, 2003, as amended
from time to time;
WHEREAS, the Adviser and the Trust, on behalf of the Technology Index Fund,
entered into an investment sub-advisory agreement with Barclays Global Funds
Advisors ("BGFA") dated as of August 12, 1999;
WHEREAS, the Board of Trustees determined on July 14, 2003 to terminate the
investment sub-advisory agreement among the Trust, the Adviser and BGFA
effective as of September __, 2003 in accordance with Rule 15a-4 under the
1940 Act;
WHEREAS, Rule 15a-4 under the 1940 Act permits an investment adviser to act
as the investment adviser for a fund under an interim investment advisory
agreement without the approval of the agreement by a majority of the
outstanding voting securities of the fund after the termination by the fund's
board of trustees of the fund's previous agreement with its prior sub-adviser;
WHEREAS, the Board of Trustees of the Trust, including a majority of the
Trustees who are not parties to this Agreement or "interested persons" (as
defined in the 1940 Act) ("Independent Trustees") of any party to this
Agreement, voted at the July 14, 2003 Board of Trustees meeting to approve
this Agreement on behalf of the Technology Index Fund on an interim basis
pursuant to Rule 15a-4 under the 1940 Act so that the Sub-Adviser may render
investment sub-advisory services to the Technology Index Fund on an interim
basis
effective as of September __, 2003;
WHEREAS, the Trust and the Adviser wish to retain the Sub-Adviser to perform
certain investment advisory services for the Trust on behalf of each of the
three other Funds pursuant to this Sub-Advisory Agreement and the Sub-Adviser
is willing to perform such services for the Trust on behalf of each Fund; and
NOW THEREFORE, in consideration of the promises and mutual covenants herein
contained, it is agreed between the Sub-Adviser, the Adviser and the Trust as
follows:
1. Appointment. The Trust and Adviser hereby appoint the Sub-Adviser to act
as investment sub-adviser to each Fund for the periods and in the manner and
on
2. the terms set forth in this Agreement. The Sub-Adviser accepts such
appointment for the compensation specified herein and agrees to furnish the
services and to assume the obligations set forth in this Agreement.
2. Investment Advisory Duties.
(a) Subject to the supervision of the Trustees of the Trust and the Adviser,
the Sub-Adviser, in coordination with the Adviser:
(i) will provide a program of continuous investment management for each
Fund
(ii) 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 Sub-Adviser by the
Adviser; will make investment decisions for each Fund;
(iii) will place orders to purchase and sell securities and other assets
for each Fund;
(iv) will provide assistance in determining the fair value of certain
portfolio securities when market quotations are not readily available for the
purpose of calculating each Fund's net asset value in accordance with the
procedures and methods established by the Board of Trustees of the Trust; and
(v) will cooperate with and provide reasonable assistance to the Adviser,
the Administrator, Sub-Administrator, Fund Accounting Agent, Custodian,
Foreign Custodians, Transfer Agent and Pricing Agents and all other agents and
representatives of the Funds and the Adviser, will keep all such persons fully
informed as to such matters as they may reasonably deem necessary to the
performance of their obligations to the Funds and the Adviser, will provide
prompt responses to reasonable requests made by such persons, and will
establish appropriate interfaces with each such entity so as to promote the
efficient exchange of information.
(b) In performing its investment sub-advisory services to each Fund under
this Agreement, the Sub-Adviser will provide each Fund, among other things,
analysis of statistical and economic data and information concerning the
applicable index for each Fund, including portfolio composition. The Sub-
Adviser will determine the securities, instruments, repurchase agreements,
futures, 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 Sub-Adviser will recommend to the Trust and the
Adviser what portion of each Fund's portfolio shall be invested in securities
and other assets, and what portion if any, should be held in cash or other
liquid assets.
(c) The Sub-Adviser's duties shall not include and the Sub-Adviser shall
have no responsibility for tax reporting or securities lending.
(d) The Sub-Adviser further agrees that, in performing its duties
hereunder, it 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 Sub-Adviser also will provide to the Trust such
information and assurances (including sub-certifications) as the Adviser 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) 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) furnish to the Trust or the Adviser, or cause to be furnished, whatever
statistical information the Trust or the Adviser may reasonably request with
respect to each Fund's assets or contemplated investments.
(v) keep the Trust, the Trustees and the Adviser informed of developments
materially affecting each Fund's portfolio and shall, when requested meet
quarterly with the Trustees to explain its activities. Further, on the Sub-
Adviser's own initiative, furnish to the Trust and the Adviser from time to
time whatever information the Sub-Adviser believes appropriate for this
purpose;
(vi) make available to the Trust's Administrator, Sub-Administrator, the Fund
Accounting Agent, the Adviser 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, Sub-Administrator, the Fund
Accounting Agent, the Adviser and the Trust in their compliance with
applicable laws and regulations. The Sub-Adviser will furnish the Trustees
with such periodic and special reports regarding each Fund and any sub-Adviser
as they may reasonably request. In addition, the Sub-Adviser will furnish to
the Board of Trustees, the Adviser and third-party data reporting services all
currently available standardized performance information and other customary
data;
(vii) immediately notify the Trust in the event that the Sub-Adviser or any of
its affiliates: (I) becomes aware that it is subject to a statutory
disqualification that prevents the Sub-Adviser from serving as investment
adviser pursuant to this Agreement; or (II) becomes aware that it is the
subject of an administrative proceeding or enforcement action by the SEC or
other regulatory authority. The Sub-Adviser further agrees to notify the
Trust immediately of any material fact known to the Sub-Adviser respecting or
relating to the Sub-Adviser 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;
(viii) 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 Sub-Adviser seek to obtain any such information;
(ix) not consult with any other sub-adviser of the Trust (if any), or with the
sub-adviser to any other investment company (or separate series thereof)
managed by the Adviser concerning each Fund's transactions in securities or
other assets, except for purposes of complying with the conditions of Rule
12d3-1(a) and (b) under the 1940 Act; and
(x) vote proxies related to securities held by the Funds in the best interest
of each Fund and in accordance with the Trust's Proxy Voting Policies and
Procedures and the Sub-Adviser's Proxy Voting Policies and Procedures as they
may exist from time to time.
(e)will promptly notify the Trust in writing of the occurrence of any of the
following events:
(i) the Sub-Adviser fails to be registered as an investment adviser under
the Advisers Act or under the laws of any jurisdiction in which such
Sub-Adviser is required to be registered as an investment adviser in order to
perform its obligations under this Agreement;
(ii) the 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 partner of the 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 Sub-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, in
accordance with the rules and regulations of the Commodity Futures Trading
Commission ("CFTC") applicable to registered investment companies and their
investment advisers.
The Sub-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 Sub-Adviser may, using such of the securities and other property in the
Brokerage Accounts as the Sub-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 Sub-Adviser deems desirable or appropriate.
The Trust represents and warrants that it is a "qualified eligible client"
within the meaning of CFTC Regulations Section 4.7 and, as such, consents to
treat each Fund in accordance with the exemption contained in CFTC Regulations
Section 4.7(b).
4. Brokerage Transactions. The Sub-Adviser will select broker-dealers to
execute transactions for the Fund and will monitor the execution capabilities
of such broker-dealers. The Sub-Adviser will seek to achieve best execution
of orders for the Funds by selecting brokers that are able to provide "best
execution" of 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 Sub-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 Sub-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 Sub-Adviser's research and
portfolio management capability generally. It is further understood in
accordance with Section 28(e) of the Securities Exchange Act of 1934, as
amended ("1934 Act"), that the Sub-Adviser may use a broker whose commissions
on transactions may exceed the commissions that another broker would have
charged for effecting the transaction, provided that the Sub-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 the Sub-Adviser's
responsibilities to each Fund or the Sub-Advisers overall responsibilities to
the its discretionary accounts.
Neither the Sub-Adviser nor any parent, subsidiary or related firm shall act
as a securities broker with respect to any purchases or sales of securities
that may be made on behalf of each Fund, unless such transactions are in
compliance with the 1940 Act and any other applicable rules and regulations.
Unless otherwise directed by the Trust in writing, the Sub-Adviser may utilize
the service of whatever securities brokerage firm or firms it deems
appropriate to the extent that such firms are competitive with respect to
price of services and execution.
5. Allocation of Charges and Expenses.
(a) Except as otherwise specifically provided in this Section 5, the Sub-
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
Sub-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.
(b) The Sub-Adviser shall not be required to pay pursuant to this Agreement
any expenses of each Fund other than those specifically allocated to the Sub-
Adviser in this section 5. In particular, but without limiting the
Generality of the foregoing, the Sub-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 Sub-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 Sub-Adviser's overhead and employee costs); fees payable to the
Sub-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,
or Fund Accounting Agent or of any Custodian, Sub-custodian, Transfer Agent,
Registrar, or Dividend Disbursing Agent of each Fund; 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 Sub-Adviser; and travel expenses (or an appropriate portion thereof)
of officers or Trustees of the Trust who are officers, directors or
employees of the Sub-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.
6. Compensation.
As compensation for the services provided and expenses assumed by the
Sub-Adviser under this Agreement, the Adviser will pay the Sub-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 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 6, 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 Sub-Adviser's compensation is payable
pursuant to this section, then the Sub-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 6.
7. Books and Records. The Sub-Adviser will maintain all accounts, books and
records with respect to each Fund as are required of a sub-investment adviser
of a registered investment company pursuant to the 1940 Act and the Investment
Advisers Act of 1940, as amended ("Advisers Act") and the rules thereunder and
shall file with the SEC all forms pursuant to Section 13 of the 1934 Act, with
respect to its duties as are set forth herein. The Sub-Adviser agrees to
maintain such books and records with respect to its services to each Fund as
are required by Section 31 under the 1940 Act, and rules adopted thereunder,
and by other applicable legal provisions under the 1940 Act or the Advisers
Act, and to preserve such records for the periods and in the manner required
by that Section, and those rules and legal provisions. The Sub-Adviser also
agrees that records it 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 Sub-Adviser further agrees that it will furnish to regulatory
authorities having the requisite authority any information or reports in
connection with its services hereunder which may be requested in order to
determine whether the operations of each Fund are being conducted in
accordance with applicable laws and regulations.
8. Aggregation of Orders. Provided that the investment objective, policies
and restrictions of each Fund are adhered to, the Trust agrees that the Sub-
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 Sub-Adviser or with accounts of the affiliates of the Sub-Adviser, if
in the Sub-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 Sub-Adviser represents the Sub-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.
9. Standard of Care and Limitation of Liability. The Sub-Adviser shall
exercise its best judgment in rendering the services provided by it under
this Agreement. The Sub-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 Sub-Adviser against any liability to the Trust, each Fund or to
holders of each Fund's shares to which the Sub-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 Sub-Adviser's
reckless disregard of its obligations and duties under this Agreement or
otherwise for breach of this Agreement. As used in this section 9, the term
"Sub-Adviser" shall include any officers, directors, employees or other
affiliates of the Sub-Adviser performing services with respect to each Fund.
10. Liability and Indemnification .
(a) Neither Sub-Adviser nor its officers, partners, employees, affiliates,
agents or controlling persons shall be liable to the Trust, each Fund, its
shareholders and/or any other person for the acts, omissions, errors of
judgment and/or mistakes of law of any other fiduciary and/or person with
respect to each Fund.
(b) Neither the Sub-Adviser nor its officers, partners, employees, affiliates,
agents or controlling persons or assigns shall be liable for any act,
omission, error of judgment or mistake of law and/or for any loss suffered by
the Trust, each Fund, its shareholders and/or any other person in connection
with the matters to which this Agreement relates; provided that no provision
of this Agreement shall be deemed to protect the Sub-Adviser against any
liability to the Trust, each Fund and/or its shareholders which it might
otherwise be subject by reason of any willful misfeasance, bad faith or gross
negligence in the performance of its duties or the reckless disregard of its
obligations and duties under this Agreement.
(c) The Trust on behalf of each Fund, hereby agrees to indemnify and hold
harmless the Sub-Adviser, its partner, officers and employees and agents and
each person, if any, who controls the Sub-Adviser (collectively, the
"Indemnified Parties") against any and all losses, claims damages or
liabilities (including reasonable attorneys fees and expenses), joint or
several, relating to the Trust or Fund, to which any such Indemnified Party
may become subject under the Securities Act of 1933, as amended ("1933 Act"),
the 1934 Act, the Advisers Act or other federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon (1) any act, omission, error and/or mistake of any other fiduciary
and/or any other person; or (2) any untrue statement or alleged untrue
statement of a material fact or any omission or alleged omission to state a
material fact required to be stated or necessary to make the statements made
not misleading in (a) the Registration Statement, the prospectus or any other
filing, (b) any advertisement or sales literature authorized by the Trust for
use in the offer and sale of shares of each Fund, or (c) any application or
other document filed in connection with the qualification of the Trust or
shares of each Fund under the Blue Sky or securities laws of any jurisdiction,
except insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any such untrue statement or
omission or alleged untrue statement or omission (i) in a document prepared by
the Sub-Adviser, or (ii) made in reliance upon and in conformity with
information furnished to the Trust by or on behalf of the Sub-Adviser
pertaining to or originating with the Sub-Adviser for use in connection with
any document referred to in clauses (a), (b) or (c).
(d) It is understood, however, that nothing in this paragraph 10 shall
protect any Indemnified Party against, or entitle any Indemnified Party to,
indemnification against any liability to the Trust, Fund and/or its
shareholders to which such Indemnified Party is subject, by reason of its
willful misfeasance, bad faith or gross negligence in the performance of its
duties, or by reason of any reckless disregard of its obligations and duties
under this Agreement or any breach of this Agreement.
(e) Notwithstanding any other provision of this Agreement, the Sub-Adviser
shall not be liable for any loss to each Fund or the Adviser caused directly
or indirectly by circumstances beyond the Sub-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.
11. Services Not Exclusive. It is understood that the services of the Sub-
Adviser are not exclusive, and that nothing in this Agreement shall prevent
the Sub-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 Sub-Adviser's ability to meet its obligations to each Fund
hereunder. When the Sub-Adviser recommends the purchase or sale of a security
for other investment companies and other clients, and at the same time the Sub-
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 Sub-Adviser nor any of its directors,
officers or employees shall act as a principal or agent or receive any
commission. If the Sub-Adviser provides any advice to its clients concerning
the shares of each Fund, the Sub-Adviser shall act solely as investment
counsel for such clients and not in any way on behalf of the Trust or each
Fund.
12. Duration and Termination.
(a) Except as provided in paragraph (c) of this Section 12 with respect to
the Technology Index Fund, this Agreement shall continue for a period of two
years from the commencement date specified above, 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 Independent
Trustees 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, except as set forth below, this Agreement
may be terminated: (a) 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
Sub-Adviser or (b) by the Sub-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).
(c) With respect to the Technology Index Fund, this Agreement shall be
effective as of September __, 2003 and will continue in effect for a period of
no more than 150 days from such date unless approved by shareholders of the
Technology Index Fund.
13. 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.
14. Use of Name. The Sub-Adviser hereby consents to the use of its name and
the names of its affiliates in each Fund's disclosure documents, shareholder
communications, advertising, sales literature and similar communications.
15. Confidential Information. The Sub-Adviser shall maintain the strictest
confidence regarding the business affairs of each Fund. Written reports
furnished by the Sub-Adviser to the Trust or the Adviser shall be treated by
such entities as confidential and for the exclusive use and benefit of the
Trust except as disclosure may be required by applicable law.
16. Notices. All notices hereunder shall be provided in writing and
delivered by first class postage pre-paid U.S. mail or by fax. Notices
delivered by mail shall be deemed given three days after mailing and upon
receipt if sent by fax.
If to Trust: E*TRADE FUNDS
0000 Xxxxxxxx Xxxxx
Xxxxx Xxxx, XX 00000
Attn: President Fax No.: (000) 000-0000
If to Adviser: E*TRADE ASSET MANAGEMENT, INC.
0000 Xxxxxxxx Xxxxx
Xxxxx Xxxx, XX 00000
Attn: President Fax No.: (000) 000-0000
If to Sub-Adviser: WORLD ASSET MANAGEMENT
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: _____________ Fax No.: ________
17. 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.
(d) Nothing herein shall be construed as constituting the Sub-Adviser as an
agent of the Adviser, 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) Concurrently with the execution of this Sub-Advisory Agreement, the Sub-
Adviser is delivering to the Adviser and the Trust a copy of part II of its
(or Munder's, as applicable) Form ADV, as revised, on file with the SEC. The
Adviser and the Trust hereby acknowledge receipt of such copy.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers designated below as of
September __, 2003 with respect to the E*TRADE Technology Index Fund
and as of _______, 2003 with respect to each other Fund.
E*TRADE FUNDS
By:
Name: __________________________
Title: ___________________________
E*TRADE ASSET MANAGEMENT, INC.
By:
Name: __________________________
Title: ___________________________
MUNDER CAPITAL MANAGEMENT, on behalf of WORLD ASSET MANAGEMENT
By:
Name: __________________________
Title: ___________________________
EXHIBIT A
Name of Fund Sub-Advisory Fee
E*TRADE International Index Fund 0.15%
E*TRADE Xxxxxxx 2000 Index Fund 0.07%
E*TRADE S&P 500 Index Fund 0.03%
E*TRADE Technology Index Fund 0.12%
