Exhibit (g)
ADMINISTRATION AGREEMENT
AGREEMENT, dated September 29, 2006, between BlackRock Senior Floating
Rate Fund II, Inc. (the "Fund"), a Maryland corporation and BlackRock Advisors,
LLC (the "Administrator"), a Delaware limited liability company.
WHEREAS, the Administrator has agreed to furnish administration services
to the Fund, a continuously offered, closed-end investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Fund is one of the "feeder" funds for and invests all of its
assets in Master Senior Floating Rate Trust, which serves as the "master"
portfolio and has the same investment objective and policies as the Fund;
WHEREAS, this Agreement has been approved in accordance with the
provisions of the 1940 Act, and the Administrator is willing to furnish such
services upon the terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein contained and other good and valuable consideration, the receipt of which
is hereby acknowledged, it is agreed by and between the parties hereto as
follows:
1. In General. The Administrator agrees, all as more fully set forth
herein, to act as administrator to the Fund and to supervise and arrange for the
day to day operations of the Fund.
2. Duties and Obligations of Administrator with Respect to the
Administration of the Fund. The Administrator agrees to furnish office
facilities and equipment and clerical, bookkeeping and administrative services
(other than such services, if any, provided by the Fund's Custodian, Transfer
Agent and Dividend Disbursing Agent and other service providers) for the Fund.
To the extent requested by the Fund, the Administrator agrees to provide the
following administrative services:
(a) Oversee the determination and publication of the Fund's net
asset value in accordance with the Fund's policy as adopted from time to time by
the Board of Directors;
(b) Oversee the maintenance by the Fund's Custodian and Transfer
Agent and Dividend Disbursing Agent of certain books and records of the Fund as
required under Rule 31a1(b)(4) of the 1940 Act and maintain (or oversee
maintenance by such other persons as approved by the Board of Directors) such
other books and records required by law or for the proper operation of the Fund;
(c) Oversee the preparation and filing of the Fund's federal, state
and local income tax returns and any other required tax returns;
(d) Review the appropriateness of and arrange for payment of the
Fund's expenses;
(e) Coordinate tender offers for the Fund's shares and the
implementation of any other share purchase programs authorized by the Board of
Directors;
(f) Prepare for review and approval by officers of the Fund
financial information for the Fund's semiannual and annual reports, proxy
statements and other communications with shareholders required or otherwise to
be sent to Fund shareholders, and arrange for the printing and dissemination of
such reports and communications to shareholders;
(g) Prepare for review by an officer of the Fund the Fund's periodic
financial reports required to be filed with the Securities and Exchange
Commission ("SEC") on Form NSAR, Form NCSR, Form NPX, Form NQ, and such other
reports, forms and filings, as may be mutually agreed upon;
(h) Prepare such reports relating to the business and affairs of the
Fund as may be mutually agreed upon and not otherwise appropriately prepared by
the Fund's custodian, counsel or auditors;
(i) Make such reports and recommendations to the Board of Directors
concerning the performance of the independent accountants as the Board of
Directors may reasonably request or deems appropriate;
(j) Make such reports and recommendations to the Board of Directors
concerning the performance and fees of the Fund's Custodian and Transfer and
Dividend Disbursing Agent as the Board of Directors may reasonably request or
deems appropriate;
(k) Oversee and review calculations of fees paid to the Fund's
service providers;
(l) Oversee the Fund's portfolio and perform necessary calculations
as required under Section 18 of the 1940 Act;
(m) Consult with the Fund's officers, independent accountants, legal
counsel, custodian, accounting agent and transfer and dividend disbursing agent
in establishing the accounting policies of the Fund and monitor financial and
shareholder accounting services;
(n) Determine the amounts available for distribution as dividends
and distributions 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 dividend disbursing agent and custodian with such information as is
required for such parties to effect the payment of dividends and distributions
and to implement the Fund's dividend reinvestment plan;
(o) Prepare such information and reports as may be required by any
banks from which the Fund borrows funds;
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(p) Provide such assistance to the Custodian and the Fund's counsel
and auditors as generally may be required to properly carry on the business and
operations of the Fund;
(q) Assist in the preparation and filing of Forms 3, 4, and 5
pursuant to Section 16 of the Securities Exchange Act of 1934, as amended, and
Section 30(h) of the 1940 Act for the officers and Directors of the Fund, such
filings to be based on information provided by those persons;
(r) Respond to or refer to the Fund's officers or transfer agent,
shareholder (including any potential shareholder) inquiries relating to the
Fund; and
(s) Supervise any other aspects of the Fund's administration as may
be agreed to by the Fund and the Administrator.
All services are to be furnished through the medium of any directors,
officers or employees of the Administrator or its affiliates as the
Administrator deems appropriate in order to fulfill its obligations hereunder.
The Fund will reimburse the Administrator or its affiliates for all out of
pocket expenses incurred by them in connection with the performance of the
administrative services described in this paragraph 2. The Fund will reimburse
the Administrator and its affiliates for their costs in providing accounting
services to the Fund.
3. Covenants. (a) In the performance of its duties under this Agreement,
the Administrator shall at all times conform to, and act in accordance with, any
requirements imposed by: (i) the provisions of the 1940 Act and the Investment
Advisers Act of 1940, as amended, and all applicable Rules and Regulations of
the Securities and Exchange Commission; (ii) any other applicable provision of
law; (iii) the provisions of the Charter and By Laws of the Fund, as such
documents are amended from time to time; (iv) the investment objectives and
policies of the Fund as set forth in its Registration Statement on Form N-2
and/or the resolutions of the Board of Directors; and (v) any policies and
determinations of the Board of Directors of the Fund and
(b) In addition, the Administrator will treat confidentially and as
proprietary information of the Fund all records and other information relative
to the Fund, and the Fund's prior, current or potential shareholders, and will
not use such records and information for any purpose other than performance of
its responsibilities and duties hereunder, except after prior notification to
and approval in writing by the Fund, which approval shall not be unreasonably
withheld and may not be withheld where the Administrator may be exposed to civil
or criminal contempt proceedings for failure to comply, when requested to
divulge such information by duly constituted authorities, or when so requested
by the Fund.
4. Services Not Exclusive. Nothing in this Agreement shall prevent the
Administrator or any officer, employee or other affiliate thereof from acting as
administrator for
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any other person, firm or corporation, or from engaging in any other lawful
activity, and shall not in any way limit or restrict the Administrator or any of
its officers, employees or agents from buying, selling or trading any securities
for its or their own accounts or for the accounts of others for whom it or they
may be acting; provided, however, that the Administrator will undertake no
activities which, in its judgment, will adversely affect the performance of its
obligations under this Agreement.
5. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Administrator hereby agrees that all records which it
maintains for the Fund are the property of the Fund and further agrees to
surrender promptly to the Fund any such records upon the Fund's request. The
Administrator further agrees to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1
under the 1940 Act.
6. Expenses. During the term of this Agreement, the Administrator will
bear all costs and expenses of its employees and any overhead incurred in
connection with its duties hereunder and shall bear the costs of any salaries or
directors' fees of any officers or directors of the Fund who are affiliated
persons (as defined in the 0000 Xxx) of the Administrator; provided that the
Board of Directors of the Fund may approve reimbursement to the Administrator of
the pro rata portion of the salaries, bonuses, health insurance, retirement
benefits and all similar employment costs for the time spent on Fund operations,
(including, without limitation, compliance matters) (other than the provision of
administrative services required to be provided hereunder) of all personnel
employed by the Administrator who devote substantial time to Fund operations or
the operations of other investment companies administered by the Administrator.
7. Compensation of the Administrator. (a) The Fund agrees to pay to the
Administrator and the Administrator agrees to accept as full compensation for
all services rendered by the Administrator as such, a monthly fee (the
"Administration Fee") in arrears at an annual rate equal to the amount set forth
in Schedule A hereto of the average daily value of the Fund's Net Assets. "Net
Assets" means the total assets of the Fund minus the sum of the accrued
liabilities. It is understood that the liquidation preference of any outstanding
preferred stock (other than accumulated dividends) is not considered a liability
in determining the Fund's Net Asset Value. For any period less than a month
during which this Agreement is in effect, the fee shall be prorated according to
the proportion which such period bears to a full month of 28, 29, 30 or 31 days,
as the case may be.
(b) For purposes of this Agreement, the net assets of the Fund shall
be calculated pursuant to the procedures adopted by resolutions of the Directors
of the Fund for calculating the value of the Fund's assets or delegating such
calculations to third parties.
8. Indemnity. (a) The Fund may, in the discretion of the Board of
Directors of the Fund, indemnify the Administrator, and each of the
Administrator's directors, officers, employees, agents, associates and
controlling persons and the directors, partners, members, officers, employees
and agents thereof (including any individual who serves at the Administrator's
request as director, officer, partner, member, trustee or the like of another
entity)
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(each such person being an "Indemnitee") against any liabilities and expenses,
including amounts paid in satisfaction of judgments, in compromise or as fines
and penalties, and counsel fees (all as provided in accordance with applicable
state law) reasonably incurred by such Indemnitee in connection with the defense
or disposition of any action, suit or other proceeding, whether civil or
criminal, before any court or administrative or investigative body in which such
Indemnitee may be or may have been involved as a party or otherwise or with
which such Indemnitee may be or may have been threatened, while acting in any
capacity set forth herein or thereafter by reason of such Indemnitee having
acted in any such capacity, except with respect to any matter as to which such
Indemnitee shall have been adjudicated not to have acted in good faith in the
reasonable belief that such Indemnitee's action was in the best interest of the
Fund and furthermore, in the case of any criminal proceeding, so long as such
Indemnitee had no reasonable cause to believe that the conduct was unlawful;
provided, however, that (1) no Indemnitee shall be indemnified hereunder against
any liability to the Fund or its shareholders or any expense of such Indemnitee
arising by reason of (i) willful misfeasance, (ii) bad faith, (iii) gross
negligence or (iv) reckless disregard of the duties involved in the conduct of
such Indemnitee's position (the conduct referred to in such clauses (i) through
(iv) being sometimes referred to herein as "disabling conduct"), (2) as to any
matter disposed of by settlement or a compromise payment by such Indemnitee,
pursuant to a consent decree or otherwise, no indemnification either for said
payment or for any other expenses shall be provided unless there has been a
determination that such settlement or compromise is in the best interests of the
Fund and that such Indemnitee appears to have acted in good faith in the
reasonable belief that such Indemnitee's action was in the best interest of the
Fund and did not involve disabling conduct by such Indemnitee and (3) with
respect to any action, suit or other proceeding voluntarily prosecuted by any
Indemnitee as plaintiff, indemnification shall be mandatory only if the
prosecution of such action, suit or other proceeding by such Indemnitee was
authorized by a majority of the full Board of Directors of the Fund.
(b) The Fund may make advance payments in connection with the
expenses of defending any action with respect to which indemnification might be
sought thereunder if the Fund receives a written affirmation of the Indemnitee's
good faith belief that the standard of conduct necessary for indemnification has
been met and a written undertaking to reimburse the Fund unless it is
subsequently determined that such Indemnitee is entitled to such indemnification
and if the Directors of the Fund determine that the facts then known to them
would not preclude indemnification. In addition, at least one of the following
conditions must be met: (A) the Indemnitee shall provide security for such
Indemnitee undertaking, (B) the Fund shall be insured against losses arising by
reason of any unlawful advance, or (C) a majority of a quorum consisting of
Directors of the Fund who are neither "interested persons" of the Fund (as
defined in Section 2(a)(19) of the 0000 Xxx) nor parties to the proceeding
("Disinterested Non Party Directors") or an independent legal counsel in a
written opinion, shall determine, based on a review of readily available facts
(as opposed to a full trial type inquiry), that there is reason to believe that
the Indemnitee ultimately will be found entitled to indemnification.
(c) All determinations with respect to the standards for
indemnification hereunder shall be made (1) by a final decision on the merits by
a court or other body before whom the proceeding was brought that such
Indemnitee is not liable or is not liable by reason of disabling conduct, or (2)
in the absence of such a decision, by (i) a majority vote of a quorum of
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the Disinterested Non Party Directors of the Fund, or (ii) if such a quorum is
not obtainable or, even if obtainable, if a majority vote of such quorum so
directs, independent legal counsel in a written opinion. All determinations that
advance payments in connection with the expense of defending any proceeding
shall be authorized and shall be made in accordance with the immediately
preceding clause (2) above.
The rights accruing to any Indemnitee under these provisions shall not
exclude any other right to which such Indemnitee may be lawfully entitled.
9. Limitation on Liability. The Administrator will not be liable for any
error of judgment or mistake of law or for any loss suffered by Administrator or
by the Fund in connection with the performance of this Agreement, except a loss
resulting from willful misfeasance, bad faith or gross negligence on its part in
the performance of its duties or from reckless disregard by it of its duties
under this Agreement. As used in this Section 9, the term "Administrator" shall
include any affiliates of the Administrator performing services for the Fund
contemplated hereby and partners, directors, officers and employees of the
Administrator and of such affiliates.
10. Duration and Termination. This Agreement shall become effective as of
the date hereof and, unless sooner terminated with respect to the Fund as
provided herein, shall continue in effect for a period of two years. Thereafter,
if not terminated, this Agreement shall continue in effect with respect to the
Fund for successive periods of 12 months, provided such continuance is
specifically approved at least annually by both (a) the vote of a majority of
the Fund's Board of Directors or the vote of a majority of the outstanding
voting securities of the Fund at the time outstanding and entitled to vote, and
(b) by the vote of a majority of the Directors who are not parties to this
Agreement or interested persons of any party to this Agreement, cast in person
at a meeting called for the purpose of voting on such approval. Notwithstanding
the foregoing, this Agreement may be terminated by the Fund at any time, without
the payment of any penalty, upon giving the Administrator 60 days' notice (which
notice may be waived by the Administrator), provided that such termination by
the Fund shall be directed or approved by the vote of a majority of the
Directors of the Fund in office at the time or by the vote of the holders of a
majority of the voting securities of the Fund at the time outstanding and
entitled to vote, or by the Administrator on 60 days' written notice (which
notice may be waived by the Fund). This Agreement will also immediately
terminate in the event of its assignment. (As used in this Agreement, the terms
"majority of the outstanding voting securities," "interested person" and
"assignment" shall have the same meanings of such terms in the 1940 Act.)
11. Notices. Any notice under this Agreement shall be in writing to the
other party at such address as the other party may designate from time to time
for the receipt of such notice and shall be deemed to be received on the earlier
of the date actually received or on the fourth day after the postmark if such
notice is mailed first class postage prepaid.
12. Amendment of this Agreement. This Agreement may be amended by the
parties only if such amendment is specifically approved by the vote of the Board
of Directors of the Fund, including a majority of those Directors 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
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approval and, where required by the 1940 Act, by a vote of a majority of the
outstanding voting securities of the Fund.
13. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York for contracts to be performed
entirely therein without reference to choice of law principles thereof and in
accordance with the applicable provisions of the 1940 Act. To the extent that
the applicable laws of the State of New York, or any of the provisions, conflict
with the applicable provisions of the 1940 Act, the latter shall control.
14. Use of the Name BlackRock. The Administrator has consented to the use
by the Fund of the name or identifying word "BlackRock" in the name of the Fund.
Such consent is conditioned upon the employment of the Administrator as the
investment Administrator to the Fund. The name or identifying word "BlackRock"
may be used from time to time in other connections and for other purposes by the
Administrator and any of its affiliates. The Administrator may require the Fund
to cease using "BlackRock" in the name of the Fund if the Fund ceases to employ,
for any reason, the Administrator, any successor thereto or any affiliate
thereof as investment Administrator of the Fund.
15. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. 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 thereby. This Agreement shall be binding on, and shall inure to the
benefit of the parties hereto and their respective successors.
16. Counterparts. This Agreement may be executed in counterparts by the
parties hereto, each of which shall constitute an original counterpart, and all
of which, together, shall constitute one Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused the foregoing
instrument to be executed by their duly authorized officers, all as of the day
and the year first above written.
BLACKROCK SENIOR FLOATING RATE FUND II, INC.
By:
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Name:
Title:
BLACKROCK ADVISORS, LLC
By:
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Name:
Title:
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Schedule A
Administration Fee
0.40% of the average daily Net Assets of the Fund.
