SUB-INVESTMENT ADVISORY AGREEMENT THE DREYFUS CORPORATION
THE
DREYFUS CORPORATION
000 Xxxx
Xxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Xxxxx 0,
0000
Xxxxxx
Capital Management Corporation
00
Xxxxxxx Xxxxxx
Xxxxx
0000
Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Ladies
and Gentlemen:
As you
are aware, Dreyfus Dynamic Alternatives Fund, Inc. (the "Fund") desires to
employ its capital by investing and reinvesting the same in investments of the
type and in accordance with the limitations specified in the Fund's Prospectus
and Statement of Additional Information as from time to time in effect, copies
of which have been or will be submitted to you, and in such manner and to such
extent as from time to time may be approved by the Fund's Board. The
Fund employs The Dreyfus Corporation (the "Adviser") to act as its investment
adviser pursuant to a written agreement (the "Management Agreement"), a copy of
which has been furnished to you. The Adviser desires to retain you,
and you hereby agree to accept such retention, as the Fund's sub-investment
adviser.
In
connection with your serving as sub-investment adviser to the Fund, it is
understood that from time to time you will employ or associate with yourself
such person or persons as you may believe to be particularly fitted to assist
you in the performance of this sub-investment advisory agreement (the
"Agreement"). Such person or persons may be officers or employees of
both you and the Fund. The compensation of such person or persons
shall be paid by you and no obligation may be incurred on the Fund's behalf in
any such respect.
Subject
to the supervision and approval of the Adviser and the Fund's Board, you will
provide investment management of the Fund's portfolio in accordance with the
Fund's investment objective, policies and limitations as stated in the Fund's
Prospectus and Statement of Additional Information as from time to time in
effect. In connection therewith, you will supervise the Fund's
investments and conduct a continuous program of investment, evaluation and, if
appropriate, sale and reinvestment of the Fund's assets. You will
furnish to the Adviser or the Fund such information, with respect to the
investments which the Fund may hold or contemplate purchasing, as the Adviser or
the Fund may reasonably request. The Fund and the Adviser wish to be
informed of important developments materially affecting the Fund's portfolio and
shall expect you, on your own initiative, to furnish to the Fund or the Adviser
from time to time such information as you may believe appropriate for this
purpose. The Adviser shall furnish you with copies of the Fund's
Prospectus, Statement of Additional Information and shareholder reports,
including all supplements and/or amendments thereto. You shall have
no responsibility with respect to the collection of income, physical acquisition
or the safekeeping of the Fund's assets.
You shall
exercise your best judgment in rendering the services to be provided hereunder,
and the Adviser agrees as an inducement to your undertaking the same that you
shall not be liable hereunder for any error of judgment or mistake of law or for
any loss suffered by the Fund or the Adviser, provided that nothing herein shall
be deemed to protect or purport to protect you against any liability to the
Adviser, the Fund or the Fund's stockholders to which you would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your reckless disregard of
your obligations and duties hereunder. The Fund is expressly made a
third party beneficiary of this Agreement with rights as respect to the Fund to
the same extent as if it had been a party hereto.
In
consideration of services rendered pursuant to this Agreement, the Adviser will
pay you, on the first business day of each month, a fee at the annual rate set
forth on Schedule 1 hereto. If the Adviser waives all or a portion of
the management fee it is entitled to receive from the Fund, the fee payable to
you pursuant to this Agreement may be reduced as you and the Adviser mutually
agree.
Net asset
value shall be computed on such days and at such time or times as described in
the Fund's then-current Prospectus and Statement of Additional
Information. The fee for the period from the date of the commencement
of the initial public sale of the Fund's shares to the end of the month during
which such sale shall have been commenced shall be pro-rated according to the
proportion which such period bears to the full monthly period, and upon any
termination of this Agreement before the end of any month, the fee for such part
of a month shall be pro-rated according to the proportion which such period
bears to the full monthly period and shall be payable within 10 business days of
the date of termination of this Agreement.
For the
purpose of determining fees payable to you, the value of the Fund's net assets
shall be computed in the manner specified in the Fund's then-current Prospectus
and Statement of Additional Information for the computation of the value of the
Fund's net assets.
You will
bear all expenses in connection with the performance of your services under this
Agreement. All other expenses to be incurred in the operation of the
Fund (other than those borne by the Adviser) will be borne by the Fund, except
to the extent specifically assumed by you. The expenses to be borne
by the Fund include, without limitation, the
following: organizational costs, taxes, interest, loan commitment
fees, interest and distributions paid on securities sold short, brokerage fees
and commissions, if any, fees of Board members who are not officers, directors,
employees or holders of 5% or more of the outstanding voting securities of you
or the Adviser or any affiliate of you or the Adviser, Securities and Exchange
Commission fees and state Blue Sky qualification fees, advisory fees, charges of
custodians, transfer and dividend disbursing agents' fees, certain insurance
premiums, industry association fees, outside auditing and legal expenses, costs
of independent pricing services, costs of maintaining the Fund'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 stockholders, costs of stockholders' reports and
meetings, license fees, and any extraordinary expenses.
The
Adviser understands that in entering into this Agreement you have relied upon
the inducements made by the Fund to you under the Management
Agreement. The Adviser also understands that you now act, and that
from time to time hereafter you may act, as investment adviser or sub-investment
adviser to one or more investment companies and fiduciary or other managed
accounts, and the Adviser has no objection to your so acting, provided that when
the purchase or sale of securities of the same issuer is suitable for the
investment objectives of two or more companies or accounts managed by you and
which have available funds for investment in the case of a purchase, the
available securities will be allocated in a manner believed by you to be
equitable to each company or account. It is recognized that in some
cases this procedure may adversely affect the price paid or received by the Fund
or the size of the position obtainable for or disposed of by the
Fund. It is also understood that you and the Adviser or any other
sub-adviser to the Fund shall be prohibited from consulting with each other
concerning transactions described in Rule 12d3-1(c) under the Investment Company
Act of 1940, as amended, and that your responsibility regarding investment
advice hereunder is limited to the Fund.
Furthermore,
the Adviser understands that in entering into this Agreement you have relied
upon the following representations by the Adviser: (1) the Adviser
has complied with the applicable provisions of the Commodity Exchange Act, and
the rules and regulations or exemptions thereunder (the "CEA"), with respect to
its operation of the Fund, including, without limitation, the submission of any
applicable filings or notices with the Commodity Futures Trading Commission or
the National Futures Association; (2) the Adviser has taken all actions
necessary to ensure that the Fund and the Adviser are exempt from registration
as a "commodity pool operator" or a "commodity trading adviser," as applicable,
as those terms are defined in the CEA; (3) the Fund is a "qualified eligible
person" (as that term is defined in Section 4.7 of the CEA) and an "accredited
investor" (as that term is defined in Rule 501(c) under the Securities Act of
1933, as amended); and (4) the Fund is an "eligible contract participant" (as
that term is defined in Section 1a of the CEA).
The
Adviser is entering into this Agreement with you based, in part, on your
representations that you have complied with the applicable provisions of the
CEA, with respect to the services you are providing to the Fund under this
Agreement, including, without limitation, the submission of any applicable
filings or notices with the Commodity Futures Trading Commission or the National
Futures Association, and that you have taken all actions necessary to ensure
that you are registered or exempt from registration as a "commodity trading
adviser" as that term is defined in the CEA.
In
addition, it is understood that the persons employed by you to assist in the
performance of your duties hereunder will not devote their full time to such
services and nothing contained herein shall be deemed to limit or restrict your
right or the right of any of your affiliates to engage in and devote time and
attention to other businesses or to render services of whatever kind or
nature.
You shall
not be liable for any error of judgment or mistake of law or for any loss
suffered by the Fund or the Adviser in connection with the matters to which this
Agreement relates, except for a loss resulting from willful misfeasance, bad
faith or gross negligence on your part in the performance of your duties or from
reckless disregard by you of your obligations and duties under this
Agreement. Any person, even though also your officer, director,
partner, employee or agent, who may be or become an officer, Board member,
employee or agent of the Fund, shall be deemed, when rendering services to the
Fund or acting on any business of the Fund, to be rendering such services to or
acting solely for the Fund and not as your officer, director, partner, employee,
or agent or one under your control or direction even though paid by
you.
This
Agreement shall continue until the date set forth on Schedule 1 hereto (the
"Reapproval Date"), and thereafter shall continue automatically for successive
annual periods ending on the day of each year set forth on Schedule 1 hereto
(the "Reapproval Day"), provided such continuance is specifically approved at
least annually by (i) the Fund's Board or (ii) vote of a majority (as defined in
the Investment Company Act of 1940, as amended) of the Fund's outstanding voting
securities, provided that in either event its continuance also is approved by a
majority of the Fund's Board members who are not "interested persons" (as
defined in said Act) of any party to this Agreement, by vote cast in person at a
meeting called for the purpose of voting on such approval. This
Agreement is terminable without penalty (i) by the Adviser upon 60 days' notice
to you, (ii) by the Fund's Board or by vote of the holders of a majority of the
Fund's outstanding voting securities upon 60 days' notice to you, or (iii) by
you upon not less than 90 days' notice to the Fund and the
Adviser. This Agreement also will terminate automatically in the
event of its assignment (as defined in said Act or the Investment Advisers Act
of 1940, as amended). In addition, notwithstanding anything herein to
the contrary, if the Management Agreement terminates for any reason, this
Agreement shall terminate effective upon the date the Management Agreement
terminates. The Adviser agrees to give you prompt notice in the event
of termination of the Management Agreement.
The
Adviser acknowledges receipt of Part II of your Form ADV at least 48 hours prior
to entering into this Agreement, as required by Rule 204-3 under the Investment
Advisers Act of 1940, as amended. No provision of this Agreement may
be changed, waived or discharged unless signed in writing by the parties
hereto. This Agreement shall be governed by the laws of the State of
New York, without regard to the conflict of law principles thereof,
provided that
nothing herein shall be construed in a manner inconsistent with the Investment
Company Act of 1940, as amended, or the Investment Advisers Act of 1940, as
amended. This Agreement may be executed in several counterparts, each
of which shall be deemed an original for all purposes, including judicial proof
of the terms hereof, and all of which together shall constitute and be deemed
one and the same agreement. If any one or more of the provisions of
this Agreement shall be held contrary to express law or against public policy,
or shall for any reason whatsoever be held invalid, then such provisions shall
be deemed severable from the remainder of this Agreement and shall in no way
affect the validity or enforceability of the other provisions of this
Agreement.
Unless
otherwise provided herein or agreed to in writing by the parties, all notices,
instructions or advice permitted or required under this Agreement shall be
deemed to have been properly given if sent by regular first-class mail,
registered mail, private courier or facsimile and addressed to (or delivered to)
the respective party at the address set forth above or at such other address or
addresses as shall be specified, in each case, in a notice similarly
given. Each party may rely upon any notice from the other party or
other communication reasonably believed by the receiving party to be
genuine.
If the
foregoing is in accordance with your understanding, will you kindly so indicate
by signing and returning to us the enclosed copy hereof.
|
Very
truly yours,
|
||
|
THE
DREYFUS CORPORATION
|
||
|
By:
|
||
|
Name:
|
||
|
Title:
|
||
|
Accepted:
|
|
|
MELLON
CAPITAL MANAGEMENT CORPORATION
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
SCHEDULE
1
|
Annual
Fee
as
a Percentage
of
Average Daily
Net
Assets
|
Reapproval
Date
|
Reapproval
Day
|
||
|
0.41%
|
August
31, 2011
|
August
31st
|
||
