STRUCTURING FEE AGREEMENT
Exhibit 99.(h)(6)
August [• ], 2010
UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
00000
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
00000
Ladies and Gentlemen:
This agreement is between BlackRock Advisors, LLC (including any successor or assign by merger
or otherwise, the “Company”) and UBS Securities LLC (“UBS”) with respect to BlackRock Build America
Bond Trust (the “Fund”).
1. Fee. In consideration of certain financial advisory services that UBS has provided to the
Company in assisting the Company in structuring and organizing the Fund, which may but need not
necessarily include views from an investor market and distribution perspective on (i)
diversification, proportion and concentration approaches for the Fund’s investments in light of
current market conditions, (ii) marketing issues with respect to the Fund’s investment policies and
proposed investments, (iii) the proportion of the Fund’s assets to invest in the Fund’s strategies,
(iv) the overall marketing and positioning thesis for the Fund’s initial public offering, the
Company shall pay a fee to UBS in the aggregate amount of $[ ] (the “Fee”). In the event the
offering does not proceed, UBS will not receive any fees under this Agreement; however, for the
avoidance of doubt, accountable expenses actually incurred may be payable to UBS pursuant to
Section 4(b) of the Underwriting Agreement. The Fee shall be paid
within 30 days of the closing of the purchase
and sale of the common shares pursuant to the Underwriting Agreement or as
otherwise agreed to by the parties. The sum total of this Fee, plus
the structuring fees and sales incentive fee paid to certain other
underwriters in connection with this offering, plus the
underwriters’ counsel fee paid by the Fund and commissions paid
to certain registered personnel of its broker-dealer affiliates shall
not exceed 9.0% of the total price of the Fund's common shares sold
by the Fund pursuant to the Prospectus.
2. Term. This Agreement shall terminate upon the payment of the entire amount of the Fee, as
specified in Section 1 hereof or upon the termination of the
Underwriting Agreement without common shares having been delivered
and paid for. Notwithstanding the foregoing, Sections 4, 5, 8, 9 and 10 of this
Agreement and the Indemnification Agreement attached hereto shall survive the termination of this
Agreement.
3. Indemnification. The Company agrees to the indemnification and other agreements set forth
in the Indemnification Agreement attached hereto, the provisions of which are incorporated herein
by reference and shall survive the termination, expiration or supersession of this Agreement.
4. Confidential
Advice. None
of (i) the name of UBS, (ii) any advice rendered by UBS to the Company, or (iii) the terms of this
Agreement or any communication from UBS in connection with the services performed by UBS pursuant
to this Agreement will be quoted or referred to orally or in writing, or in the case of (ii) and
(iii), reproduced or disseminated, by the Company or any of its affiliates or any of their agents,
without UBS’ prior written consent, except (i) the Company may
promptly disclose the foregoing to any regulatory authority in
response to a regulatory proceeding, process, inquiry or request
provided the Company shall give UBS prompt notice of such request and
disclosure if it is legally able to do so, (ii) to the extent
otherwise required by law, judicial process or applicable regulation
(after consultation with, and approval (not to be unreasonably
withheld) as to form and substance by UBS and its counsel, unless
such consultation is prohibited by law, order or regulation) and
(iii) on a confidential need-to-know and non-reliance basis, to the
Company and its officers, directors, legal counsel and auditors.
5. Information. The Company recognizes and confirms that UBS (a) has used and relied
primarily on the information provided by the Company and on information available from generally
recognized public sources in performing the services contemplated by this Agreement without having
assumed responsibility for independently verifying the same, (b) has not assumed responsibility for
the accuracy or completeness of such information and (c) has not made an appraisal
of any assets or liabilities (contingent or otherwise) of the Fund. The information provided by the
Company, when delivered, was true and correct in all material respects and did not contain any
material misstatement of fact or omit to state any material fact necessary to make the statements
contained therein not misleading. The Company will promptly notify UBS if it learns of any
material inaccuracy or misstatement in, or material omission from, any information provided by the
Company to UBS pursuant to this Section 5.
For
a period of two years from the date of this Agreement, UBS will keep
confidential any material non-public information of the Company made
available to UBS by the Company in connection with its engagement
hereunder; provided, such confidential information shall not include
(1) any information already available to or in the possession of UBS
prior to the date of its disclosure to UBS by the Company, (2) any
information that is or becomes generally available to the public, or
(3) any information which becomes available to UBS on a
non-confidential basis from a third party who is not known by UBS to
be bound by a confidentiality obligation to the Company; and provided
further, that such confidential information may be disclosed (a) to
UBS’ affiliates, partners, employees, agents, advisors and
representatives in connection with its engagement hereunder who shall
be informed of the confidential nature of the information and that
such information is subject to a confidentiality agreement; (b) to
any person with the consent of the Company; (c) if UBS is required to
disclose such information pursuant to law, judicial or administrative
process, or regulatory demand or request of any body having
jurisdiction over UBS; or (d) if such disclosure is deemed necessary
by UBS in litigation or any other proceeding in which it or any of
its current or former directors, officers, employees, agents,
representatives, affiliates or any person who controls UBS is, or is
threatened to be made, a party. In the event that UBS is requested or
required by law to disclose any such confidential information, UBS
shall provide the Company with prompt written notice, to the extent
legally permissible, of any such request or requirement so that the
Company may seek a protective order or other appropriate remedy;
provided that no such prior notification shall be required in respect
of any disclosure to regulatory authorities having jurisdiction over
UBS. This subparagraph supersedes any prior agreement between the
Company and UBS respecting confidentiality.
6. Not an Investment Advisor. The Company acknowledges that you have not provided any advice
hereunder as to the value of securities or regarding the advisability of purchasing or selling any
securities for the Fund’s portfolio. The Company acknowledges and agrees that UBS has been retained
to act solely as an advisor to the Company, and the Company’s engagement of UBS is not intended to
confer rights upon any person (including the Fund or any shareholders, employees or creditors of
the Company or the Fund) not a party hereto as against UBS or its affiliates, or their respective
directors, officers, employees or agents, successors, or assigns. UBS has acted as an independent
contractor under this Agreement, and not in any other capacity including as a fiduciary, and any
duties arising out of its engagement shall be owed solely to the Company.
7. Not Exclusive. Nothing herein shall be construed as prohibiting you or your affiliates from
acting as an underwriter or financial advisor or in any other capacity for any other persons
(including other registered investment companies or other investment managers).
8. Amendment; Waiver. No provision of this Agreement may be amended or waived except by an
instrument in writing signed by the parties hereto.
9. Governing Law. This Agreement and any claim, counterclaim or dispute of any kind or nature
whatsoever arising out of or in any way relating to this Agreement (“Claim”), directly or
indirectly, shall be governed by and construed in accordance with the laws of the State of New
York. No Claim may be commenced, prosecuted or continued in any court other than the courts of the
State of New York located in the City and County of New York or in the United States District Court
for the Southern District of New York, which courts shall have exclusive jurisdiction over the
adjudication of such matters, and the Company and UBS consent to the jurisdiction of such courts
and personal service with respect thereto. EACH OF UBS AND THE COMPANY WAIVES ALL RIGHT TO TRIAL BY
JURY IN ANY PROCEEDING OR CLAIM (WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
IN ANY WAY RELATING TO THIS AGREEMENT.
10. Successors and Assigns. This Agreement shall be binding upon the Company and UBS and their
respective successors and assigns and any successor or assign of any substantial portion of the
Company’s or UBS’ respective businesses and/or assets.
11. Counterparts. This Agreement may be executed in any number of counterparts, each of which
shall be an original, and all of which, when taken together, shall constitute one agreement.
Delivery of an executed signature page of this Agreement by facsimile transmission shall be
effective as delivery of a manually executed counterpart hereof.
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This Agreement shall be effective as of the date first written above.
| BLACKROCK ADVISORS, LLC |
||||
| By: | ||||
| Name: | Xxxx Xxxxxxx | |||
| Title: | Managing Director | |||
| Agreed and Accepted: UBS SECURITIES LLC |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| By: | ||||
| Name: | ||||
| Title: | ||||
Indemnification Agreement
August [• ], 2010
UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
In connection with the engagement of UBS Securities LLC (“UBS”) to advise and assist the
undersigned (including any successor or assign by merger or otherwise, the “Company”) with the
matters set forth in the Structuring Fee Agreement dated August
[• ], 2010 between the Company
and UBS (the “Agreement”), in the event that UBS becomes involved in any capacity in any claim,
suit, action, proceeding, investigation or inquiry (including, without limitation, any shareholder
or derivative action or arbitration proceeding) (collectively, a “Proceeding”) in connection with
any matter in relating to or arising out of the Agreement, including, without limitation, related
services and activities prior to the date of the Agreement, the Company agrees to indemnify, defend
and hold UBS harmless to the fullest extent permitted by law, from and against any losses, claims,
damages, liabilities and expenses in connection with any such Proceeding, except to the extent that
it shall be determined by a court of competent jurisdiction in a judgment that has become final in
that it is no longer subject to appeal or other review, that such losses, claims, damages,
liabilities and expenses resulted primarily from the willful
misconduct, bad faith or gross negligence
of UBS. The indemnification provided hereunder shall not extend to those matters indemnified under the Underwriting Agreement, dated August [•], 2010, by and among BlackRock Build America Bond Trust (the “Fund”), BlackRock Advisers, LLC, BlackRock Investment Management, LLC and each of the underwriters named therein. In addition, in the event that UBS becomes involved in any capacity
in any such Proceeding, the Company will reimburse UBS for its legal and other expenses (including
the cost of any investigation and preparation) as such expenses are incurred by UBS in connection
therewith, provided that such expenses will be promptly refunded to
the Company to the extent incurred in connection with a Proceeding as to which there has been a final judicial determination that UBS is not entitled to indemnification pursuant to the express terms of the first sentence of this paragraph.
Promptly as reasonably practicable after receipt by UBS of notice of the commencement of any
Proceeding with respect to which indemnity is sought hereunder, UBS will notify the Company in
writing of the commencement thereof; provided that the failure to so notify the Company (i) will
not relieve the Company from liability under this paragraph to the extent it is not materially
prejudiced as a result thereof and (ii) in any event shall not relieve the Company from any
liability which it may have otherwise than on account of this Indemnification Agreement. The
Company may assume the defense of any such Proceeding, including the employment of counsel
reasonably satisfactory to UBS. UBS shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of UBS, unless (i) the Company shall have failed promptly to assume the
defense thereof and employ counsel as provided above or (ii) the named parties to any such
Proceeding (including impleaded parties) include UBS and the Company, and UBS shall have been
advised by counsel that there may be one or more legal defenses available to it that are different
from or in addition to those available to the Company, provided that the Company shall not in any
event be responsible hereunder for the fees and expenses of more than one firm of separate counsel
in connection with any Proceeding in the same jurisdiction, in addition to any local counsel.
If such indemnification were not to be available for any reason, the Company agrees to
contribute to the losses, claims, damages, liabilities and expenses involved (i) in the proportion
appropriate to reflect the relative benefits received or sought to be received by the Company and
its stockholders and affiliates, on the one hand, and UBS, on the other
hand, in the matters contemplated by the Agreement or (ii) if (but only if and to the extent) the
allocation provided for in clause (i) is for any reason held unenforceable, in such proportion as
is appropriate to reflect not only the relative benefits referred to in clause (i) but also the
relative fault of the Company and its stockholders and affiliates, on the
one hand, and the party entitled to contribution, on the other hand, as well as any other relevant
equitable considerations. The Company agrees that for the purposes of this paragraph the relative
benefits received by or sought to be received, by the Company and its stockholders and affiliates, on
the one hand, and the party entitled to contribution, on the other hand, of a transaction as
contemplated shall be deemed to be in the same proportion that the
total value received by or paid to or
contemplated to be received by or paid to the Company or its stockholders or affiliates, as the case may be, as a result of or in connection with the transaction (whether
or not consummated) for which UBS has been retained to perform services bears to the fees paid to
UBS under the Agreement; provided, that in no event shall the Company contribute less than the
amount necessary to assure that UBS is not liable for losses, claims, damages, liabilities and
expenses in excess of the amount of fees actually received by UBS pursuant to the Agreement.
Relative fault shall be determined by reference to, among other things, whether any alleged untrue
statement or omission or any other alleged conduct relates to information provided by the Company
or other conduct by the
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Company (or its employees or other agents), on the one hand, or by UBS, on the other hand. The
Company will not settle any Proceeding in respect of which indemnity may be sought hereunder,
whether or not UBS is an actual or potential party to such Proceeding, without UBS’ prior written
consent. For purposes of this Indemnification Agreement, UBS shall include UBS Securities LLC, any
of its affiliates, each other person, if any, controlling UBS Securities LLC or any of its
affiliates, their respective officers, current and former directors, employees and agents, and the
successors and assigns of all of the foregoing persons. The foregoing indemnity and contribution
agreement shall be in addition to any rights that any indemnified party may have at common law or
otherwise.
The
Company agrees that UBS shall not have any liability to the Company or any person asserting claims on
behalf of or in right of the Company in connection with or as a result of either UBS’ engagement
under the Agreement or any matter referred to in the Agreement, including, without limitation,
related services and activities prior to the date of the Agreement, except to the extent that it
shall be determined by a court of competent jurisdiction in a judgment that has become final in
that it is no longer subject to appeal or other review that any losses, claims, damages,
liabilities or expenses incurred by the Company resulted primarily
from the willful misconduct, bad faith or gross negligence of UBS in performing the services that are the subject of the Agreement.
THIS INDEMNIFICATION AGREEMENT AND ANY CLAIM, COUNTERCLAIM OR DISPUTE OF ANY KIND OR NATURE
WHATSOEVER WITH RESPECT TO THE SERVICES PERFORMED PURSUANT TO AND IN ACCORDANCE WITH THE AGREEMENT
(“CLAIM”), DIRECTLY OR INDIRECTLY, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK. EXCEPT AS SET FORTH BELOW, NO CLAIM MAY BE COMMENCED, PROSECUTED OR
CONTINUED IN ANY COURT OTHER THAN THE COURTS OF THE STATE OF NEW YORK LOCATED IN THE CITY AND
COUNTY OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK,
WHICH COURTS SHALL HAVE EXCLUSIVE JURISDICTION OVER THE ADJUDICATION OF SUCH MATTERS, AND THE
COMPANY AND UBS CONSENT TO THE JURISDICTION OF SUCH COURTS AND PERSONAL SERVICE WITH RESPECT
THERETO. THE COMPANY HEREBY CONSENTS TO PERSONAL JURISDICTION, SERVICE AND VENUE IN ANY COURT IN
WHICH ANY CLAIM ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT IS BROUGHT BY ANY THIRD
PARTY AGAINST UBS OR ANY INDEMNIFIED PARTY. EACH OF UBS AND THE COMPANY WAIVES ALL RIGHT TO TRIAL
BY JURY IN ANY PROCEEDING OR CLAIM (WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF
OR IN ANY WAY RELATING TO THIS AGREEMENT. EACH OF UBS AND THE COMPANY AGREES THAT A FINAL JUDGMENT IN ANY
PROCEEDING OR CLAIM ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT BROUGHT IN ANY SUCH
COURT SHALL BE CONCLUSIVE AND BINDING UPON UBS AND THE COMPANY, AS
THE CASE MAY BE, AND MAY BE ENFORCED IN ANY OTHER COURTS TO
THE JURISDICTION OF WHICH UBS AND THE COMPANY, AS THE CASE MAY BE, IS OR MAY BE SUBJECT, BY SUIT UPON SUCH JUDGMENT.
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The foregoing Indemnification Agreement shall remain in full force and effect notwithstanding
any termination of UBS’ engagement. This Indemnification Agreement shall be binding upon the
Company and UBS and their respective successors and assigns and any successor or assign of any
substantial portion of the Company’s or UBS’ respective businesses and/or assets. This
Indemnification Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which shall constitute one and the same agreement.
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| Very truly yours, BLACKROCK ADVISORS, LLC |
||||
| By: | ||||
| Name: | Xxxx Xxxxxxx | |||
| Title: | Managing Director | |||
| Agreed and Accepted: UBS SECURITIES LLC |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| By: | ||||
| Name: | ||||
| Title: | ||||
[Indemnification Agreement]
