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SUB-INVESTMENT ADVISORY AGREEMENT
AGREEMENT dated December 2, 2019, among BlackRock Limited
Duration Income Trust, a Delaware statutory trust (the “Trust”),
BlackRock Advisors, LLC, a Delaware limited liability company (the “Advisor”),
and BlackRock (Singapore) Limited, a corporation organized under the laws of
Singapore (the “Sub-Advisor”).
WHEREAS, the Advisor has agreed to furnish investment
advisory services to the Trust, a closed-end management investment company
registered under the Investment Company Act of 1940, as amended (the “1940
Act”); and
WHEREAS, the Advisor wishes to retain the Sub-Advisor to
provide it with certain sub-advisory services as described below in connection
with the Advisor’s advisory activities on behalf of the Trust; and
WHEREAS, the investment management agreement between the
Advisor and the Trust, dated September 29, 2006, as amended from time to time
(such agreement or the most recent successor agreement between such parties
relating to advisory services to the Trust is referred to herein as the “Advisory
Agreement”), contemplates that the Advisor may appoint a sub-adviser to
perform investment advisory services with respect to the Trust; and
WHEREAS, this Agreement has been approved in accordance
with the provisions of the 1940 Act, and the Sub-Advisor 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.
Appointment. The Advisor hereby appoints the Sub-Advisor to act
as sub-advisor with respect to the Trust and the Sub-Advisor accepts such
appointment and agrees to render the services herein set forth for the
compensation herein provided.
2.
Services of the Sub-Advisor. Subject to the succeeding provisions
of this section, the oversight and supervision of the Advisor and the direction
and control of the Board of Trustees of the Trust, the Sub-Advisor will perform
certain of the day-to‑day operations of the Trust, which may include one
or more of the following services, at the request of the Advisor: (a) acting as
investment advisor for and managing the investment and reinvestment of those
assets of the Trust as the Advisor may from time to time request and in
connection therewith have complete discretion in purchasing and selling such
securities and other assets for the Trust and in voting, exercising consents
and exercising all other rights appertaining to such securities and other
assets on behalf of the Trust; (b) arranging, subject to the provisions of
paragraph 3 hereof, for the purchase and sale of securities and other assets of
the Trust; (c) providing investment research and credit analysis concerning the
Trust’s investments; (d) assisting the Advisor in determining what portion of
the Trust’s assets will be invested in cash, cash equivalents and money market instruments;
(e) placing orders for all purchases and sales of such investments made for the
Trust; and (f) maintaining the books and records as are required to support the
Trust’s investment operations. At the request of the Advisor, the Sub-Advisor
will also, subject to the oversight and
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supervision of
the Advisor and the direction and control of the Board of Trustees of the
Trust, provide to the Advisor or the Trust any of the facilities and equipment
and perform any of the services described in Section 3 of the Advisory
Agreement. In addition, the Sub-Advisor will keep the Trust and the Advisor
informed of developments materially affecting the Trust and shall, on its own
initiative, furnish to the Trust from time to time whatever information the
Sub-Advisor believes appropriate for this purpose. The Sub-Advisor will
periodically communicate to the Advisor, at such times as the Advisor may
direct, information concerning the purchase and sale of securities for the
Trust, including: (a) the name of the issuer, (b) the amount of the purchase or
sale, (c) the name of the broker or dealer, if any, through which the purchase
or sale is effected, (d) the CUSIP number of the instrument, if any, and (e)
such other information as the Advisor may reasonably require for purposes of
fulfilling its obligations to the Trust under the Advisory Agreement. The
Sub-Advisor will provide the services rendered by it under this Agreement in
accordance with the Trust’s investment objective, policies and restrictions (as
currently in effect and as they may be amended or supplemented from time to
time) as stated in the Trust’s Prospectus and Statement of Additional
Information and the resolutions of the Trust’s Board of Trustees.
3.
Covenants. (a) In the performance of its duties under this
Agreement, the Sub-Advisor 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 (the “Advisers Act”), and
all applicable Rules and Regulations of the Securities and Exchange Commission
(the “SEC”); (ii) any other applicable provision of law; (iii) the
provisions of the Agreement and Declaration of Trust and By-Laws of the Trust,
as such documents are amended from time to time; (iv) the investment objective
and policies of the Trust as set forth in its Registration Statement on Form
N-2; and (v) any policies and determinations of the Board of Trustees of the
Trust.
(b)
In addition, the Sub-Advisor will:
(i)
place orders either directly with the issuer or with any broker or
dealer. Subject to the other provisions of this paragraph, in placing orders
with brokers and dealers, the Sub-Advisor will attempt to obtain the best price
and the most favorable execution of its orders. In placing orders, the
Sub-Advisor will consider the experience and skill of the firm’s securities
traders as well as the firm’s financial responsibility and administrative
efficiency. Consistent with this obligation, the Sub-Advisor may select brokers
on the basis of the research, statistical and pricing services they provide to
the Trust and other clients of the Advisor or the Sub-Advisor. Information and
research received from such brokers will be in addition to, and not in lieu of,
the services required to be performed by the Sub-Advisor hereunder. A commission
paid to such brokers may be higher than that which another qualified broker
would have charged for effecting the same transaction, provided that the
Sub-Advisor determines in good faith that such commission is reasonable in
terms either of the transaction or the overall responsibility of the Advisor
and the Sub-Advisor to the Trust and their other clients and that the total
commissions paid by the Trust will be reasonable in relation to the benefits to
the Trust over the long-term. In no instance, however, will the Trust’s
securities be purchased from or sold to the Advisor, the Sub-Advisor or any
affiliated person thereof, except to the extent permitted by the SEC or by
applicable law. It is understood that Sub-Adviser may utilize affiliates in
connection with the placement of orders with issuers and brokers or dealers,
but such use of affiliates shall
not affect the
responsibility of Sub-Adviser to Adviser for such activities. Subject to the
foregoing and the provisions of the 1940 Act, the Securities Exchange Act of
1934, as amended, and other applicable provisions of law, the Sub-Advisor may
select brokers and dealers with which it or the Trust is affiliated;
(ii)
maintain books and records with respect to the Trust’s securities
transactions and will render to the Advisor and the Trust’s Board of Trustees,
such periodic and special reports as they may request;
(iii)
maintain a policy and practice of conducting its investment advisory
services hereunder independently of the commercial banking operations of its
affiliates. When the Sub-Advisor makes investment recommendations for the
Trust, its investment advisory personnel will not inquire or take into
consideration whether the issuer of securities proposed for purchase or sale
for the Trust’s accounts are customers of the commercial department of its
affiliates; and
(iv)
treat confidentially and as proprietary information of the Trust all
records and other information relative to the Trust, and the Trust’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 Trust which approval shall not be unreasonably withheld and may not be
withheld where the Sub-Advisor 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 Trust.
4.
Services Not Exclusive. Nothing in this Agreement shall prevent
the Sub-Advisor or any officer, employee or other affiliate thereof from acting
as investment advisor for any other person, firm or corporation, or from
engaging in any other lawful activity, and shall not in any way limit or
restrict the Sub-Advisor 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 Sub-Advisor 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 Sub-Advisor hereby agrees that all records which
it maintains for the Trust are the property of the Trust as the case may be and
further agrees to surrender promptly to the Trust, any such records upon the
Trust’s request as the case may be. The Sub-Advisor 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 (to the extent such
books and records are not maintained by the Advisor).
6.
Agency Cross Transactions. From time to time, the Sub-Advisor or
brokers or dealers affiliated with it may find themselves in a position to buy
for certain of their brokerage clients (each an “Account”) securities
which the Sub-Advisor’s investment advisory clients wish to sell, and to sell
for certain of their brokerage clients securities which advisory clients wish
to buy. Where one of the parties is an advisory client, the Advisor or the
affiliated broker or dealer
cannot participate in this
type of transaction (known as a cross transaction) on behalf of an advisory
client and retain commissions from both parties to the transaction without the
advisory client’s consent. This is because in a situation where the Sub-Advisor
is making the investment decision (as opposed to a brokerage client who makes
his own investment decisions), and the Sub-Advisor or an affiliate is receiving
commissions from one or both sides of the transaction, there is a potential
conflicting division of loyalties and responsibilities on the Sub-Advisor’s
part regarding the advisory client. The SEC has adopted a rule under the
Advisers Act which permits the Sub-Advisor or its affiliates to participate on
behalf of an Account in agency cross transactions if the advisory client has
given written consent in advance. By execution of this Agreement, the Trust authorizes
the Sub-Advisor or its affiliates to participate in agency cross transactions
involving an Account. The Trust may revoke its consent at any time by written
notice to the Sub-Advisor.
7.
Expenses. During the term of this Agreement, the Sub-Advisor will
bear all costs and expenses of its employees and any overhead incurred by the
Sub-Advisor in connection with its duties hereunder; provided that the Board of
Trustees of the Trust may approve reimbursement to the Sub-Advisor of the
pro-rata portion of the salaries, bonuses, health insurance, retirement
benefits and all similar employment costs for the time spent on the Trust’s
operations (including, without limitation, compliance matters) (other than the
provision of investment advice and administrative services required to be
provided hereunder) of all personnel employed by the Sub-Advisor who devote
substantial time to the Trust’s operations or the operations of other
investment companies advised or sub‑advised by the Sub-Advisor.
8.
Compensation.
(a)
For that portion of the Trust for which the Sub-Advisor acts as sub‑advisor,
the Advisor agrees to pay to the Sub-Advisor and the Sub-Advisor agrees to
accept as full compensation for all services rendered by the Sub-Advisor pursuant
to this Agreement, an annual fee in arrears in an amount equal to 50% of the
management fees received by the Advisor from the Trust with respect to the
average daily value of the Managed Assets of the Trust allocated to the
Sub-Advisor. “Managed Assets” means the total assets of the Trust (including
any assets attributable to money borrowed for investment purposes) minus the
sum of the Trust’s accrued liabilities (other than money borrowed for
investment purposes).
(b)
For purposes of this Agreement, the Managed Assets of the Trust shall be
calculated pursuant to the procedures adopted by resolutions of the Board of Trustees
of the Trust for calculating the value of the Trust’s assets or delegating such
calculations to third parties.
9.
Limitation on Liability.
(a)
The Sub-Advisor will not be liable for any error of judgment or mistake
of law or for any loss suffered by the Advisor or by the Trust in connection
with the performance of this Agreement, except a loss resulting from a breach
of fiduciary duty with respect to the receipt of compensation for services or 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.
(b)
Notwithstanding anything to the contrary contained in this Agreement,
the parties hereto acknowledge and agree that, as provided in Section 5.1 of
Article V of the Agreement and Declaration of Trust, this Agreement is executed
by the Trustees and/or officers of the Trust, not individually but as such Trustees
and/or officers of the Trust, and the obligations hereunder are not binding
upon any of the Trustees or Shareholders individually but bind only the estate
of the Trust.
10.
Duration and Termination.
(a)
This Agreement shall become effective as of the date hereof and, unless
sooner terminated with respect to the Trust 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 Trust 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 Trust’s Board of
Trustees or a vote of a majority of the outstanding voting securities of the
Trust at the time outstanding and entitled to vote and (b) by the vote of a
majority of the Trustees, who are not parties to this Agreement or interested
persons (as such term is defined in the 1940 Act) of any such party, cast in
person at a meeting called for the purpose of voting on such approval.
(b)
Notwithstanding the foregoing, this Agreement may be terminated by the
Trust or the Advisor at any time, without the payment of any penalty, upon
giving the Sub-Advisor 60 days’ notice (which notice may be waived by the
Sub-Advisor), provided that such termination by the Trust or the Advisor shall
be directed or approved by the vote of a majority of the Trustees of the Trust
in office at the time or by the vote of the holders of a majority of the voting
securities of the Trust at the time outstanding and entitled to vote, or by the
Sub-Advisor on 60 days’ written notice (which notice may be waived by the Trust
and the Advisor), and will terminate automatically upon any termination of the
Advisory Agreement between the Trust and the Advisor. 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. No provision of this Agreement may
be changed, waived, discharged or terminated orally, but only by an instrument
in writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought. Any amendment of this Agreement shall be
subject to the 1940 Act.
13.
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.
14.
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.
15.
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.
[Signature Page Follows]
IN WITNESS WHEREOF, the parties
hereto have caused this instrument to be executed by their duly authorized
officers designated below as of the day and year first above written.
BLACKROCK ADVISORS, LLC
By: /s/ Neal J. Andrews
Name: Neal J. Andrews
Title: Managing Director
BLACKROCK (SINGAPORE) LIMITED
By: /s/ Patrick Leung
Name: Patrick Leung
Title: Managing Director
BLACKROCK (SINGAPORE) LIMITED
By: /s/ Deborah Ho
Name: Deborah Ho
Title: Managing Director
BLACKROCK LIMITED DURATION
INCOME TRUST
By: /s/ John Perlowski
Name: John Perlowski
Title: President and Chief Executive Officer