INVESTMENT MANAGEMENT AND ADMINISTRATION AGREEMENT
DREYFUS HIGH YIELD STRATEGIES FUND
000 XXXX XXXXXX
XXX XXXX, XXX XXXX 00000
April 22, 1998
The Dreyfus Corporation
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Dreyfus High Yield Strategies Fund, a Massachusetts business trust (the
"Fund"), herewith confirms its agreement with you as follows:
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 its Declaration of Trust and in its Prospectus 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 of Trustees. The Fund desires to employ you to act as its investment
adviser.
In this connection 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 Agreement. Such
person or persons may be officers or employees who are employed by both you and
the Fund. The compensation of such person or persons will 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 Fund's Board of
Trustees, you will provide investment management of the Fund's portfolio in
accordance with the Fund's investment objective and policies as stated in its
Prospectus as from time to time in effect. In connection therewith, you will
obtain and provide investment research and 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 Fund such
statistical information, with respect to the investments which the Fund may hold
or contemplate purchasing, as the Fund may reasonably request. The Fund wishes
to be informed of important developments materially affecting its portfolio and
will expect you, on your own initiative, to furnish to the Fund from time to
time such information as you may believe appropriate for this purpose.
Subject to the supervision and approval of the Fund's Board of
Trustees, you also will provide administrative services for the Fund, including
the following: (i) assist in preparing financial information relating to the
Fund for the Fund's periodic reports to shareholders, proxy materials and
earnings press releases; (ii) assemble all reports required to be filed by the
Fund with the Securities and Exchange Commission on Form N-SAR, or such other
form as the Securities and Exchange Commission may substitute for Form N-SAR,
and file such completed forms with the Securities and Exchange Commission; (iii)
assist in providing to the Fund's independent accountants such information as is
necessary with respect to the Fund's Federal, state and local tax returns; (iv)
monitor compliance of the Fund's operations with the 1940 Act and with its
investment policies and limitations as currently in effect; (v) arrange for the
dissemination to shareholders of the Fund's proxy materials; (vi) negotiate
contractual arrangements with the Fund's agents, including custodians, transfer
agents, dividend paying agents, independent accountants and printing companies;
monitor the performance of such agents pursuant to such arrangements; and make
such reports and recommendations to the Board concerning the provision of such
services as the Board reasonably requests or as you deem appropriate; (vii)
oversee the calculation of the Fund's net asset value and make the Fund's net
asset value available for public dissemination; (viii) oversee the maintenance
of the Fund's books and records under Rule 31a-1 under the 1940 Act by the
Fund's custodians and transfer agent as applicable; (ix) establish the
accounting policies of the Fund; establish and monitor the Fund's operating
expense budgets; review the Fund's bills and process the payment of bills; (x)
assist the Fund in determining the amount of dividends and distributions
available to be paid by the Fund to its shareholders; prepare and arrange for
the printing of dividend notices to shareholders; and provide the Fund's
transfer and dividend disbursing agent and custodians with such information as
is required for such parties to effect the payment of dividends and
distributions and to implement the Fund's Automatic Dividend Reinvestment Plan,
and (xi) if requested by the Board, arrange for persons to serve as Fund
officers.
In addition, you will supply office facilities (which may be in your
own offices), data processing services, clerical, accounting and bookkeeping
services, internal auditing and legal services, internal executive and
administrative services, and stationery and office supplies; prepare reports to
the Fund's stockholders, tax returns, reports to and filings with the Securities
and Exchange Commission and, if necessary, state Blue Sky authorities; and
generally assist in all aspects of the Fund's operations.
You will exercise your best judgment in rendering the services to be
provided to the Fund hereunder and the Fund agrees as an inducement to your
undertaking the same that you will not be liable hereunder for any error of
judgment or mistake of law or for any loss suffered by the Fund, provided that
nothing herein will be deemed to protect or purport to protect you against any
liability to the Fund or to its security holders 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.
In consideration of services rendered pursuant to this Agreement, the
Fund will pay you on the first business day of each month a fee at the annual
rate of .90 of 1% of the value of the Fund's average weekly net assets. Net
asset value will be computed on such days and at such time or times as described
in the Fund's then-current Prospectus. The fee for the period from the date of
the closing of the initial public offering of the Fund's shares to the end of
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the month during which such sale will have closed will 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 will be pro-rated according to the proportion which such period bears
to the full monthly period and will be payable upon the date of termination of
this Agreement.
For the purpose of determining fees payable to you, the value of the
Fund's net assets will be computed in the manner specified in the Fund's
then-current Prospectus.
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 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,
brokerage fees and commissions, if any, and other expenses in any way related to
the execution, recording and settlement of portfolio security transactions, fees
of Trustees who are not officers, Trustees, employees or holders of 5% or more
of your outstanding voting securities, Securities and Exchange Commission fees,
state Blue Sky qualification fees, advisory fees, shareholder servicing fees,
charges of custodians, transfer and dividend paying agents' fees, certain
insurance premiums, industry association fees, outside auditing and legal
expenses, costs of independent pricing services, costs of maintaining corporate
existence, expenses of reacquiring shares, expenses in connection with the
Fund's Automatic Dividend Reinvestment Plan, costs of maintaining the required
books and accountings (including the costs of calculating the net asset value of
the Fund's shares), costs attributable to investor services (including, without
limitation, telephone and personnel expenses), costs of shareholders' reports
and meetings, costs of preparing, printing and mailing share certificates, proxy
statements and prospectuses, and any extraordinary expenses.
If in any fiscal year the aggregate expenses of the Fund (including
fees pursuant to this Agreement, but excluding interest on borrowings, taxes,
brokerage and, with the prior written consent of the necessary state securities
commissions, extraordinary expenses) exceed the expense limitation of any state
having jurisdiction over the Fund, the Fund may deduct from the payment to be
made to you under this Agreement, or you will bear, such excess expense to the
extent required by state law. Your obligation pursuant hereto will be limited to
the amount of your fees hereunder. Such deduction or payment, if any, will be
estimated, reconciled and effected or paid, as the case may be, on a monthly
basis.
The Fund understands that you now act, and that from time to time
hereafter you may act, as investment adviser to one or more other investment
companies and fiduciary or other managed accounts, and the Fund has no objection
to your so acting, provided that when 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 which have available funds for investment, 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.
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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 service and nothing contained herein will 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 will not be liable for any error of judgment or mistake of law or
for any loss suffered by the Fund 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, Trustee, partner, employee
or agent, who may be or become an officer, Trustee, employee or agent of the
Fund, will 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, Trustee, partner, employee, or agent or one under
your control or direction even though paid by you.
This Agreement will continue until April 4, 2000, and thereafter will
continue automatically for successive annual periods ending on April 4 of each
year, provided such continuance is specifically approved at least annually by
(i) the Fund's Board of Trustees or (ii) vote of a majority (as defined in the
Investment Company Act of 1940) of the Fund's outstanding voting securities,
provided that in either event its continuance also is approved by a majority of
the Fund's Trustees who are not "interested persons" (as defined in said Act) of
any party to this purpose of voting on such approval. This Agreement is
terminable without penalty, on 60 days' notice, by the Fund's Board of Trustees
or by vote of holders of a majority of the Fund's shares or, upon not less than
90 days' notice, by you. This Agreement also will terminate automatically in the
event of its assignment (as defined in said Act).
The Fund recognizes that from time to time your Trustees, officers and
employees may serve as Trustees, trustees, partners, officers and employees of
other corporations, business trusts, partnerships or other entities (including
other investment companies) and that such other entities may include the name
"Dreyfus" as part of their name, and that your corporation or its affiliates may
enter into investment advisory or other agreements with such other entities. If
you cease to act as the Fund's investment adviser, the Fund agrees that, at your
request, the Fund will take all necessary action to change the name of the Fund
to a name not including "Dreyfus" in any form or combination of words.
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If the foregoing is in accordance with your understanding, will you
kindly so indicate by signing and return to us the enclosed copy hereof.
Very truly yours,
DREYFUS HIGH YIELD STRATEGIES FUND
By:
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Accepted:
THE DREYFUS CORPORATION
By:
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