Exhibit (5)(z)
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 1st day of July, 2005 by and between BNY Xxxxxxxx
Enhanced Yield Municipal Bond Fund (the "Series"), a series of BNY Xxxxxxxx
Funds, Inc., a Maryland corporation (the "Corporation") and The Bank of New
York, a New York bank (the "Adviser").
1. Duties of Adviser. The Series hereby appoints the Adviser to act as
investment adviser to the Series for the period and on such terms as are set
forth in this Agreement. The Series employs the 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 Corporation with records concerning
the Adviser's activities which the Corporation is required to maintain, and to
render regular reports to the Corporation's officers and Board of Directors
concerning the Adviser's discharge of the foregoing responsibilities. The
Advisor shall discharge the foregoing responsibilities subject to the control of
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 (No. 811-6654), including the Series' prospectus and
statement of additional information, applicable laws and regulations. The
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.
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 Subadviser 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 Subadviser 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 Subadviser 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 Subadviser in connection with its services to
other clients. The Subadviser 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 Subadviser 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.
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The Subadviser 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 Subadviser. For the services to be rendered by
the Subadviser as provided in Section 1 of this Agreement, the Adviser shall pay
to the Subadviser at the end of each month an advisory fee accrued daily and
payable monthly based on an annual percentage rate of 0.50% 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 Subadviser
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 Subadviser current
prospectuses, proxy statements, reports to shareholders, financial statements
and such other information relating to the Series as the Subadviser may
reasonably request. The Subadviser 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 Subadviser with the U.S. Securities and Exchange Commission
and certified copies of its financial statements.
5. Status of Subadviser. The services of the Subadviser to the Adviser
and the Series are not be deemed exclusive, and the Subadviser shall be free to
render similar services to others.
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6. Liability of Subadviser. In the absence of (i) willful misfeasance,
bad faith or gross negligence on the part of the Subadviser in performance of
its obligations and duties hereunder, (ii) reckless disregard by the Subadviser
of its obligations and duties hereunder or (iii) a loss resulting from a breach
of fiduciary duty by the Subadviser 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 Subadviser 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 Subadviser (or any successor thereof) as
Directors, officers, agents, shareholders or otherwise; Directors, officers,
agents and shareholders of the Subadviser are or may be interested in the
Corporation and/or the Adviser as Directors, officers, shareholders or
otherwise; and the Subadviser (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 April 30, 2007 and thereafter shall
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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 Subadviser
and, in the case of termination by the Adviser, to the Corporation. This
Agreement may be terminated by the Subadviser 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
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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 GANNETT WELSH & KOTLER, LLC
By By
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Name: Name:
Title: Title:
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