SUB-ADVISORY AGREEMENT
AGREEMENT made this 29th day of December, 2006 by and
between The Bank of New York, a New York bank (the "Adviser"), and
Xxxxxx Securities Management, Inc., a corporation organized under the
laws of the Commonwealth of Pennsylvania (the "Sub-Adviser").
1. Duties of Sub-Adviser. The Adviser hereby appoints the
Sub-Adviser to act as investment adviser to BNY Xxxxxxxx Global Real
Estate Securities Fund (the "Series"), a series of BNY Xxxxxxxx
Funds, Inc., a Maryland corporation (the "Corporation"), for the period
and on such terms as are set forth in this Agreement. The Adviser
employs the Sub-Adviser to manage the investment and reinvestment of
the assets of the Series, to continuously review, supervise and
administer the investment program of the Series, to determine in its
discretion the securities to be purchased or sold and the portion of
the Series' assets to be held uninvested, to provide the Adviser and
the Corporation with records concerning the Sub-Adviser's activities
which the Corporation is required to maintain, and to render regular
reports to the Adviser, the Corporation's officers and Board of
Directors concerning the Sub-Adviser's discharge of the foregoing
responsibilities. The Sub-Adviser shall discharge the foregoing
responsibilities subject to the control of the Adviser and the
officers and the Board of Directors of the Corporation, and in
compliance with the objectives, policies and limitations set forth in
the Corporation's Registration Statement (Nos. 811-6654; 33-47703),
including the Series' prospectus and statement of additional
information, applicable laws and regulations. In carrying out its
responsibilities hereunder, the Sub-Adviser will consult with the
Adviser on a continuous basis regarding the management of the Series.
The Sub-Adviser accepts such employment and agrees to render the
services and to provide, at its own expense, the office space,
furnishings and equipment and the personnel required by it to perform
the services on the terms and for the compensation provided therein.
2. Portfolio Transactions. The Sub-Adviser is authorized
to select the brokers or dealers that will execute the purchases and
sales of securities for the Series and is directed to use its best
efforts to obtain the best available price and most favorable
execution, except as prescribed herein. It is also understood that
it is desirable for the Series that the Sub-Adviser have access to
supplemental investment and market research and security and economic
analyses provided by brokers who may execute brokerage transactions
at a higher cost to the Series than may result when allocating
brokerage to other brokers on the basis of seeking the most favorable
price and efficient execution. Therefore, the Sub-Adviser is
authorized to place orders for the purchase and sale of securities
for the Series with such brokers, subject to review by the Directors
of the Corporation from time to time with respect to the extent and
continuation of this practice. It is understood that the services
provided by such brokers may be useful to the Sub-Adviser in connection
with its services to other clients. The Sub-Adviser may, on
occasions when it deems the purchase or sale of a security to be in
the best interests of the Series as well as its other customers
aggregate, to the extent permitted by applicable laws and
regulations, the securities to be sold or purchased in order to
obtain the best net price and the most favorable execution. In such
event, allocation of the securities so purchased or sold, as well as
the expenses incurred in the transaction, will be made by the Sub-
Adviser in the manner it considers to be the most equitable and
consistent with its fiduciary obligations. The execution of such
transactions shall not be deemed to represent an unlawful act or breach
of any duty created by this Agreement or otherwise. The Sub-Adviser
will promptly communicate to the Adviser and the officers and Directors
of the Corporation such information relating to Series transactions as
they may reasonably request.
3. Compensation of the Sub-Adviser. For the services to
be rendered by the Sub-Adviser as provided in Section 1 of this
Agreement, the Adviser shall pay to the Sub-Adviser at the end of
each month an advisory fee accrued daily and payable monthly based on
an annual percentage rate of 0.85% of the Series' average daily net
assets. Neither the Corporation nor the Series shall be responsible
for any portion of the compensation payable to the Sub-Adviser
hereunder.
In the event of termination of this Agreement, the fee
provided in this Section shall be computed on the basis of the period
ending on the last business day on which this Agreement is in effect,
subject to a pro rata adjustment based on the number of days elapsed
in the month as a percentage of the total number of days in such
month.
4. Reports. The Adviser agrees to furnish to the Sub-Adviser
current prospectuses, proxy statements, reports to shareholders,
financial statements and such other information relating to the
Series as the Sub-Adviser may reasonably request. The Sub-Adviser
agree to furnish to the Adviser and to the Corporation such
information concerning its own affairs as the Adviser or the
Corporation may reasonably request, including copies of its Form
ADV and any other filings of the Sub-Adviser with the U.S. Securities
and Exchange Commission and certified copies of its financial
statements.
5. Status of Sub-Adviser. The services of the Sub-Adviser
to the Adviser and the Series are not deemed exclusive, and the Sub-
Adviser shall be free to render similar services to others.
6. Liability of Sub-Adviser. In the absence of (i)
willful misfeasance, bad faith or gross negligence on the part of
the Sub-Adviser in performance of its obligations and duties
hereunder, (ii) reckless disregard by the Sub-Adviser of its
obligations and duties hereunder or (iii) a loss resulting from a
breach of fiduciary duty by the Sub-Adviser with respect to the
receipt of compensation for its services (in which case any award of
damages shall be limited to the period and the amount set forth in
Section 36(b)(3) of the Investment Company Act of 1940 (the "1940
Act"), the Sub-Adviser shall not be subject to any liability
whatsoever to the Adviser or the Series, or to any shareholder of
the Series, for any error of judgment, mistake of law or any other
act or omission in the course of, or connected with, rendering
services hereunder including, without limitation, for any losses that
may be sustained in connection with the purchase, holding, redemption
or sale of any security on behalf of the Series.
7. Permissible Interests. Subject to and in accordance
with the Articles of Incorporation of the Corporation and applicable
law and regulation, Directors, officers, agents and shareholders of
the Corporation and/or the Adviser are or may be interested in the
Sub-Adviser (or any successor thereof) as Directors, officers,
agents, shareholders or otherwise; Directors, officers, agents and
shareholders of the Sub-Adviser are or may be interested in the
Corporation and/or the Adviser as Directors, officers, shareholders
or otherwise; and the Sub-Adviser (or any successor) is or may be
interested in the Corporation and/or the Adviser as a shareholder
or otherwise; and the effect of any such interrelationships shall
be governed by said Articles of Incorporation and the provisions of
the 1940 Act.
8. Duration and Termination. This Agreement, unless
sooner terminated as provided herein, shall continue until June 30,
2008 and thereafter shall continue for periods of one year so long
as such continuance is specifically approved at least annually (a) by
the Adviser and (b) (1) by the vote of a majority of those members of
the Board of Directors of the Corporation who are not parties to this
Agreement or interested persons of any such party, cast in person at
a meeting called for the purpose of voting on such approval, and (2)
by the Board of Directors of the Corporation or by vote of a majority
of the outstanding voting securities of the Series. This Agreement
may be terminated by the Adviser or by the Series at any time,
without the payment of any penalty (in the case of termination by
the Series, by vote of a majority of the entire Board of Directors
of the Corporation or by vote of a majority of the outstanding voting
securities of the Series), on 60 days' written notice to the Sub-
Adviser and, in the case of termination by the Adviser, to the
Corporation. This Agreement may be terminated by the Sub-Adviser at
any time, without the payment of any penalty, upon 60 days' written
notice to the Adviser and the Series. This Agreement will
automatically and immediately terminate in the event of its
assignment. Any notice under this Agreement shall be given in
writing, addressed and delivered or mailed postpaid, to the other
party at any office of such party and shall be deemed given when
received by the addressee.
As used in this Section 9, the terms "assignment",
"interested persons", and "a vote of a majority of the outstanding
voting securities" shall have the respective meanings set forth in
Section 2(a)(4), Section 2(a)(19) and Section 2(a)(42) of the 1940
Act.
9. Amendment of Agreement. This Agreement may be amended
by mutual consent of the parties, but the consent of the Corporation
must also be obtained, which consent must be approved (a) by vote of
majority of those members of the Board of Directors of the
Corporation who are not parties to this Agreement or interested
persons of any such party, cast in person at a meeting called for the
purpose of voting on such amendment, and (b) by vote of a majority of
the outstanding voting securities of the Series.
10. Severability. If any provisions 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
thereby.
11. Applicable Law. This Agreement shall be construed
in accordance with the laws of the State of New York, provided,
however, that nothing herein shall be construed as being inconsistent
with the 1940 Act.
12. Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed to be an
original.
IN WITNESS WHEREOF, the parties have caused this Agreement
to be executed by their officers thereunto duly authorized as of the
day and year first written above.
THE BANK OF NEW YORK XXXXXX SECURITIES MANAGEMENT, INC.
By ______________________ By __________________________
Name: Name:
Title: Title:
6
DC_LAN01: 151293.1
DC_LAN01: 109518.2
