EXHIBIT K
BAT SUBSIDIARY, INC.
ADMINISTRATION AGREEMENT
ADMINISTRATION AGREEMENT, made as of the 30th day of October,
1998 between BAT Subsidiary, Inc., A Maryland corporation (the "Trust"),
and Prudential Investments Fund Management LLC, a limited liability company
organized under the laws of the State of Delaware (the "Administrator"),
WITNESSETH:
WHEREAS, the Trust is a diversified closed-end management
investment company registered under the Investment Company Act of 1940, as
amended (the "Investment Company Act"); and
WHEREAS, the Trust has retained an investment adviser for the
purpose of investing its assets in securities and desires to retain the
Administrator for certain administrative services, and the Administrator is
willing to furnish such administrative services on the terms and conditions
hereinafter set forth,
NOW, THEREFORE, the parties hereto agree as follows:
1. The Trust hereby appoints the Administrator to provide the
services set forth below, subject to the overall supervision of the Board
of Directors of the Trust for the period and on the terms set forth in this
Agreement. The Administrator hereby accepts such appointment and agrees
during such period to render the services herein described and to assume
the obligations herein set forth, for the compensation herein provided.
2. Subject to the supervision of the Board of Directors and
officers of the Trust, the Administrator shall provide facilities for
meetings of the Board of Directors and shareholders of the Trust and office
facilities and personnel to assist the officers of the Trust in the
performance of the following services;
(a) oversee the determination and publication of the Trust's
net asset value in accordance with the Trust's policy as adopted from time
to time by the Board of Directors;
(b) oversee the maintenance by State Street Bank and Trust
Company of certain books and records of the Trust as required under the
Investment Company Act of 1940 and maintain (or oversee maintenance by such
other persons as approved by the Board of Directors) such other books and
records (other than those maintained by the investment adviser) required by
law or for the proper operation of the Trust.
(c) prepare and file the Trust'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 Trust's expenses;
(e) prepare for review and approval by officers of the Trust
financial information for the Trust's quarterly, semi-annual and annual
reports, proxy statements and other communications with shareholders
required or otherwise to be sent to Trust shareholders, and arrange for the
printing and dissemination of such reports and communications to
shareholders.
(f) Prepare for review by an officer of the Trust the Trust's
periodic financial reports required to be filed with the Securities and
Exchange Commission ("SEC") on Form N-SAR and Form N-2 and such other
reports, forms or filings, as may be mutually agreed upon.
(g) Prepare reports relating to the business and affairs of
the Trust (not otherwise appropriately prepared by the Trust's investment
adviser, custodian, counsel or auditors);
(h) Prepare such information and reports as may be required
by any stock exchange or exchanges on which the Trust's shares are listed;
(i) Make such reports and recommendations to the Board
concerning the performance of the independent accountants as the Board may
reasonably request or deem appropriate;
(j) Make such reports and recommendations to the Board
concerning the performance and fees of the Trust's custodian, transfer and
dividend disbursing agent as the Board may reasonably request or deem
appropriate;
(k) Oversee and review calculations of fees paid to the
Administrator, the investment adviser and the custodian;
(l) Consult with the Trust's officers, independent
accountants, legal counsel, custodian, accounting agent and transfer and
dividend disbursing agent in establishing the accounting policies of the
Trust;
(m) Review implementation of any stock purchase or dividend
reinvestment programs authorized by the Board of Directors;
(n) Facilitate bank or other borrowings by the Trust;
(o) Prepare such information and reports as may be required
by any banks from which the Trust borrows funds;
(p) Provide such assistance to the investment adviser, the
custodian and the Trust's counsel and auditors as generally may be required
to properly carry on the business and operations of the Trust;
(q) respond to or refer to the Trust's officers or transfer
agent, shareholder inquiries relating to the Trust; and
(r) provide to Standard & Poor's Corporation ("S&P"), upon
its request, corporate or financial information reasonably available to the
Administrator to assist S&P in the rating of the Trust's shares.
All services are to be furnished through the medium of any
director, officer or employee of the Administrator as the Administrator
deems appropriate in order to fulfill its obligations hereunder.
Each party shall bear all its own expenses incurred in connection
with this Agreement.
3. The Trust will pay the Administrator a monthly fee based on
the Trust's average weekly net asset value computed at the per annum rate
of . 10% from the effective date of this agreement through December 31,
2000; and .08% from January 1, 2001 until termination of the Trust pursuant
to its Articles of Incorporation.
4. The Administrator assumes no responsibility under this
Agreement other than to render the services called for hereunder, and
specifically assumes no responsibilities for investment advice or the
investment or reinvestment of the Trust's assets.
5. The Administrator shall not be liable for any error of
judgment or for any loss suffered by the Trust in connection with the
matters to which this Agreement relates, except a loss resulting from
willful misfeasance, bad faith or gross negligence on its part in the
performance of, or from reckless disregard by it of its obligations and
duties under this Agreement.
6. This Agreement shall become effective as of the date on which
the Trust's Registration Statement on Form N-2 shall be declared effective
by the SEC and shall thereafter continue in effect unless terminated as
herein provided. This Agreement may be terminated by either party hereto
(without penalty) at any time upon not less than 60 days prior written
notice to the other party hereto.
7. The services of the Administrator to the Trust hereunder are
not exclusive and nothing in this Agreement shall limit or restrict the
right of the Administrator to engage in any other business or to render
services of any kind to any other corporation, firm, individual or
association. The Administrator shall be deemed to be an independent
contractor, unless otherwise expressly provided or authorized by this
Agreement.
8. During the term of this Agreement, the Trust agrees to furnish
the Administrator at the principal office of the Administrator prior to use
thereof, all prospectuses, proxy statements, reports to shareholders, sales
literature, or other material prepared for distribution to shareholders of
the Trust or the public that refer in any way to the Administrator. If the
Administrator reasonably objects in writing to such references within five
business days (or such other time as may be mutually agreed) after receipt
thereof, the Trust will modify such references in a manner reasonably
satisfactory to the Administrator. In the event of termination of this
Agreement, the Trust will continue to furnish to the Administrator copies
of any of the above mentioned materials that refer in any way to the
Administrator. The Trust shall furnish or otherwise make available to the
Administrator such other information relating to the business affairs of
the Trust as the Administrator at any time, or from time to time,
reasonably requests in order to discharge its obligations hereunder.
9. This Agreement may be amended by mutual written consent.
10. Any notice or other communication required to be given
pursuant to this Agreement shall be deemed duly given if delivered or
mailed by registered mail, postage prepaid, (1) to the Administrator at
Gateway Center Three, 000 Xxxxxxxx Xxxxxx, Xxxxxx, XX 00000-0000,
Attention: Secretary or (2) to the Trust at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: President.
11. This Agreement sets forth the agreement and understanding of
the parties hereto solely with respect to the matters covered hereby and
the relationship between the Trust and Prudential Investments Fund
Management, LLC as Administrator. Nothing in this Agreement shall govern,
restrict or limit in any respect any other business dealings between the
parties hereto unless otherwise expressly provided herein.
12. This Agreement shall be governed by and construed in
accordance with the laws of the State of New Jersey without reference to
choice of law principles thereof and in accordance with the Investment
Company Act. In the case of any conflict the Investment Company Act shall
control.
IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be executed by their officers designated below as of the day and year
first above written.
BAT SUBSIDIARY INC.
By: /s/ Xxxxx Xxxxxxxxxxx
____________________________
Xxxxx X. Xxxxxxxxxxx
Title: President
PRUDENTIAL INVESTMENTS FUND
MANAGEMENT LLC
By: /s/ Xxxxxx Xxxxx
____________________________
Xxxxxx X. Xxxxx
Title: Executive Vice President
& Treasurer
