EXHIBIT j.2
ACCOUNTING AGENCY AGREEMENT
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THIS ACCOUNTING AGENCY AGREEMENT is made as of ___________, 2003, by
and between XXXXX BROTHERS XXXXXXXX & CO., a limited partnership organized under
the laws of the State of New York (the "Accounting Agent"), and
XXXXXXXX-XXXXXXXXX CONVERTIBLE & INCOME FUND II(the "Fund").
WHEREAS, the Fund is registered as management investment company under
the Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Fund desires to retain the Accounting Agent to perform
certain accounting and recordkeeping services on behalf of the Fund, and the
Accounting Agent is willing to render such services.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto agree as follows:
1. Employment of Accounting Agent. The Fund hereby employs and appoints
the Accounting Agent to act as its fund accounting agent on the terms set forth
in this Agreement, and the Accounting Agent accepts such appointment.
2. Delivery of Documents. The Fund will (i) furnish the Accounting
Agent with properly certified or authenticated copies of resolutions of the
Fund's Board of Trustees authorizing the appointment of the Accounting Agent to
provide certain fund accounting services to the Fund and approving this
Agreement; (ii) provide the Accounting Agent with any other documents or
resolutions (including but not limited to directions or resolutions of the
Fund's Board of Trustees) which relate to or affect the Accounting Agent `s
performance of its duties hereunder or which the Accounting Agent may reasonably
request; and (iii) notify the Accounting Agent promptly of any matter affecting
the performance by the Accounting Agent of its services under this Agreement.
3. Recordkeeping and Calculation of Net Asset Value. The Accounting
Agent shall compute and determine the net asset value per share of the Fund as
of the close of business on the New York Stock Exchange on each day on which
such Exchange is open, unless otherwise directed by Proper Instructions (as
defined below in Section 7(a)). Such computation and determination shall be made
in accordance with (1) the provisions of the Fund's Agreement and Declaration of
Trust and By-Laws, as they may from time to time be amended and delivered to the
Accounting Agent, (2) the votes of the Board of Trustees or Directors of the
Fund at the time in force and applicable, as they may from time to time be
delivered to the Accounting Agent, and (3) Proper Instructions. On each day that
the Accounting Agent shall compute the net asset value per share of the Fund,
the Accounting Agent shall provide the Fund's investment adviser with written
reports which the investment adviser will use to verify that portfolio
transactions have been recorded in accordance with the Fund's instructions and
are reconciled with the Fund's trading records.
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In computing the net asset value, the Accounting Agent may rely upon
any information furnished by Proper Instructions, including without limitation
any information (1) as to accrual of liabilities of the Fund and as to
liabilities of the Fund not appearing on the books of account kept by the
Accounting Agent, (2) as to the existence, status and proper treatment of
reserves, if any, authorized by the Fund, (3) as to the sources of quotations to
be used in computing the net asset value, including those listed in Appendix B,
(4) as to the fair value to be assigned to any securities or other property for
which price quotations are not readily available, and (5) as to the sources of
information with respect to "corporate actions" affecting portfolio securities
of the Fund, including those listed in Appendix B. (Information as to "corporate
actions" shall include information as to dividends, distributions, stock splits,
stock dividends, rights offerings, conversions, exchanges, recapitalizations,
mergers, redemptions, calls, maturity dates and similar transactions, including
the ex-dividend and record dates and the amounts or other terms thereof). The
Fund may instruct the Accounting Agent to utilize a particular source for the
valuation of a specific security or other property and the Accounting Agent
shall be protected in utilizing the valuation provided by such source without
further inquiry in order to effect calculation of the Fund's net asset value.
Notwithstanding anything in this Agreement to the contrary, the Accounting Agent
shall not be responsible for the failure of the Fund or its investment adviser
to provide the Accounting Agent with Proper Instructions regarding liabilities
which ought to be included in the calculation of the Fund's net asset value.
In like manner, the Accounting Agent shall compute and determine the
net asset value as of such other times as the Board of Trustees of the Fund from
time to time may reasonably request.
4. Expenses and Compensation. For the services to be rendered and the
facilities to be furnished by the Accounting Agent as provided for in this
Agreement, the Fund shall pay the Accounting Agent for its services rendered
pursuant to this Agreement a fee based on such fee schedule as may from time to
time be agreed upon in writing by the Fund and the Accounting Agent. In addition
to such fee, the Accounting Agent shall xxxx the Fund separately for any
out-of-pocket disbursements of the Accounting Agent. Out-of-pocket disbursements
shall include, but shall not be limited to, those reasonable disbursements made
in connection with postage, including courier services; telephone;
telecommunications; printing, duplicating and photocopying charges; forms and
supplies; filing fees; legal expenses; and travel expenses. The foregoing fees
and disbursements shall be billed to the Fund by the Accounting Agent and shall
be paid promptly by wire transfer or other appropriate means to the Accounting
Agent.
5. Standard of Care. The Accounting Agent shall be held only to the
exercise of reasonable care in computing and determining net asset value as
provided in this Agreement, but shall not be held accountable or liable for any
losses or damages the Fund or any shareholder or former shareholder of the Fund
or any other person may suffer or incur arising from or based upon errors or
delays in the determination of such net asset value resulting from any event
beyond the reasonable control of the Accounting Agent unless such error or delay
was due to the Accounting Agent's negligence or reckless or willful misconduct
in determination of such net asset value. (The parties hereto acknowledge,
however, that the Accounting Agent's causing an error or delay in the
determination of
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net asset value may, but does not in and of itself, constitute negligence or
reckless or willful misconduct.) In no event shall the Accounting Agent be
liable or responsible to the Fund, any present or former shareholder of the Fund
or any other person for any error or delay which continued or was undetected
after the date of an audit performed by the certified public accountants
employed by the Fund if, in the exercise of reasonable care in accordance with
generally accepted accounting standards, such accountants should have become
aware of such error or delay in the course of performing such audit. The
Accounting Agent's liability for any such negligence or reckless or willful
misconduct which results in an error in determination of such net asset value
shall be limited exclusively to the direct, out-of-pocket loss the Fund,
shareholder or former shareholder shall actually incur, measured by the
difference between the actual and the erroneously computed net asset value, and
any expenses the Fund shall incur in connection with correcting the records of
the Fund affected by such error (including charges made by the Fund's registrar
and transfer agent for making such corrections) or communicating with
shareholders or former shareholders of the Fund affected by such error.
Without limiting the foregoing, the Accounting Agent shall not be held
accountable or liable to the Fund, any shareholder or former shareholder thereof
or any other person for any delays or losses, damages or expenses any of them
may suffer or incur resulting from (1) the Accounting Agent's failure to receive
timely and suitable notification concerning quotations or corporate actions
relating to or affecting portfolio securities of the Fund or (2) any errors in
the computation of the net asset value based upon or arising out of quotations
or information as to corporate actions if received by the Accounting Agent
either (i) from a source which the Accounting Agent was authorized pursuant to
the third paragraph of this Section to rely upon, (ii) from a source which in
the administrator's reasonable judgment was as reliable a source for such
quotations or information as the sources authorized pursuant to that third
paragraph, or (iii) relevant information known to the Fund or the investment
adviser which would impact the calculation of net asset value but which is not
communicated by the Fund or the investment adviser to the Accounting Agent.
In the event of any error or delay in the determination of such net
asset value for which the Accounting Agent may be liable, the Fund and the
Accounting Agent will consult and make good faith efforts to reach agreement on
what actions should be taken in order to mitigate any loss suffered by the Fund
or its present or former shareholders, in order that the Accounting Agent's
exposure to liability shall be reduced to the extent possible after taking into
account all relevant factors and alternatives. Such actions might include the
Fund or the Accounting Agent taking reasonable steps to collect from any
shareholder or former shareholder who has received any overpayment upon
redemption of shares such overpaid amount or to collect from any shareholder who
has underpaid upon a purchase of shares the amount of such underpayment or to
reduce the number of shares issued to such shareholder. It is understood that in
attempting to reach agreement on the actions to be taken or the amount of the
loss which should appropriately be borne by the Accounting Agent, the Fund and
the Accounting Agent will consider such relevant factors as the amount of the
loss involved, the Fund's desire to avoid loss of shareholder good will, the
fact that other persons or entities could have been reasonably expected to have
detected the error sooner than the time it was actually discovered, the
appropriateness of limiting or eliminating the benefit which shareholders or
former shareholders might have obtained by reason of the error, and the
possibility that other parties
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providing services to the Fund might be induced to absorb a portion of the loss
incurred.
6. Limitation of Liability.
(a) The Accounting Agent shall incur no liability with respect to any
telecommunications, equipment or power failures that are beyond the reasonable
control of the Accounting Agent, or any failures to perform or delays in
performance by postal or courier services or third-party information providers.
The Accounting Agent shall also incur no liability under this Agreement if the
Accounting Agent or any agent or entity utilized by the Accounting Agent shall
be prevented, forbidden or delayed from performing, or omits to perform, any act
or thing which this Agreement provides shall be performed or omitted to be
performed, by reason of causes or events beyond its control, including but not
limited to (x) any Sovereign Risk, or (y) any provision of any present or future
law, regulation or order of the United States or any state thereof, or of any
foreign country or political subdivision thereof, or of any securities
depository or clearing agency, or (z) any provision of any order or judgment of
any court of competent jurisdiction. A "Sovereign Risk" shall mean any
nationalization; expropriation; devaluation; revaluation; confiscation; seizure;
cancellation; destruction; strike; act of war, terrorism, insurrection or
revolution; or any other similar act or event beyond the Accounting Agent's
control.
(b) Notwithstanding any other provision of this Agreement, the
Accounting Agent shall not be held accountable or liable for any losses, damages
or expenses the Fund or any shareholder or former shareholder of the Fund or any
other person may suffer or incur arising from acts, omissions, errors or delays
of the Accounting Agent in the performance of its obligations and duties
hereunder, including without limitation any error of judgment or mistake of law,
except a damage, loss or expense resulting from the Accounting Agent's willful
malfeasance, bad faith or negligence in the performance of such obligations and
duties. The Accounting Agent shall in no event be required to take any action
which is in contravention of any applicable law, rule or regulation or any order
or judgment of any court of competent jurisdiction. The Fund hereby agrees to
indemnify the Accounting Agent against and hold it harmless from any and all
losses, claims, damages, liabilities or expenses (including reasonable counsel
fees and expenses) resulting from any act, omission, error or delay or any
claim, demand, action or suit, in connection with or arising out of performance
of its obligations and duties under this Agreement, not resulting from the
willful malfeasance, bad faith or negligence of the Accounting Agent in the
performance of such obligations and duties.
The Accounting Agent shall in no event be liable or responsible to the
Fund, any present or former shareholder of the Fund or any other person for any
error or delay which continued or was undetected after the date of an audit
performed by the certified public accountants employed by the Fund if, in the
exercise of reasonable care in accordance with generally accepted accounting
standards, such accountants should have become aware of such error or delay in
the course of performing such audit. It is also agreed that, in the event of an
act, omission, error or delay which leads to losses, costs or expenses for which
the Accounting Agent may be liable, the Fund and the Accounting Agent will
consult and make good faith efforts to reach agreement on what actions should be
taken in order to mitigate any loss suffered by the Fund or its present or
former shareholders, in order that the Accounting Agent's exposure to liability
shall be reduced to the extent possible after taking into account all relevant
factors and
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alternatives. It is understood that in attempting to reach agreement on the
actions to be taken or the amount of the loss which should appropriately be
borne by the Accounting Agent, the Fund and the Accounting Agent will consider
such relevant factors as the amount of the loss involved, the Fund's desire to
avoid loss of shareholder good will, the fact that other persons or entities
could have been reasonably expected to have detected the error sooner than the
time it was actually discovered, the appropriateness of limiting or eliminating
the benefit which shareholders or former shareholders might have obtained by
reason of the error, and the possibility that other parties providing services
to the Fund might be induced to absorb a portion of the loss incurred.
(c) Notwithstanding anything else in this Agreement to the contrary,
the Accounting Agent's entire liability to the Fund for any loss or damage
arising or resulting from its performance hereunder or for any other cause
whatsoever, and regardless of the form of action, shall be limited to the Fund's
actual and direct out-of-pocket expenses and losses which are reasonably
incurred by the Fund. In no event and under no circumstances shall the
Accounting Agent or a Fund be held liable for consequential or indirect damages,
loss of profits, damage to reputation or business or any other special damages
arising under or by reason of any provision of this Agreement or for any act or
omission hereunder.
7. Reliance by the Accounting Agent on Proper Instructions and Opinions
of Counsel and Opinions of Certified Public Accountants.
(a) The Accounting Agent shall not be liable for, and shall be
indemnified by the Fund against any and all losses, costs, damages or expenses
arising from or as a result of, any action taken or omitted in reliance upon
Proper Instructions or upon any other written notice, request, direction,
instruction, certificate or other instrument believed by it to be genuine and
signed or authorized by the proper party or parties.
"Proper Instructions" shall include a written request, direction,
instruction or certification signed or initialed on behalf of the Fund by one or
more persons as the Board of Trustees of the Fund shall have from time to time
authorized. Those persons authorized to give Proper Instructions may be
identified by the Board of Trustees by name, title or position and will include
at least one officer empowered by the Board to name other individuals who are
authorized to give Proper Instructions on behalf of the Fund. Telephonic or
other oral instructions or instructions given by telefax transmission may be
given by any one of the above persons and will also be considered Proper
Instructions if the Accounting Agent believes them to have been given by a
person authorized to give such instructions with respect to the transaction
involved.
With respect to telefax transmissions, the Fund hereby acknowledges
that (i) receipt of legible instructions cannot be assured, (ii) the Accounting
Agent cannot verify that authorized signatures on telefax instructions are
original, and (iii) the Accounting Agent shall not be responsible for losses or
expenses incurred through actions taken in reliance on such telefax
instructions. The Fund agrees that such telefax instructions shall be conclusive
evidence of the Fund's Proper Instructions to the Accounting Agent to act or to
omit to act.
Proper Instructions given orally will be confirmed by written
instructions in the manner set forth above,
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including by telefax, but the lack of such confirmation shall in no way affect
any action taken by the Accounting Agent in reliance upon such oral
instructions. The Fund authorizes the Accounting Agent to tape record any and
all telephonic or other oral instructions given to the Accounting Agent by or on
behalf of the Fund (including any of its officers, Trustees, employees or agents
or any investment manager or adviser or person or entity with similar
responsibilities which is authorized to give Proper Instructions on behalf of
the Fund to the Accounting Agent.)
(b) The Accounting Agent may consult with its counsel or the Fund's
counsel in any case where so doing reasonably appears to the Accounting Agent to
be necessary or desirable. The Accounting Agent shall not be considered to have
engaged in any misconduct or to have acted negligently and shall be without
liability in acting upon the advice of its counsel or of the Fund's counsel.
(c) The Accounting Agent may consult with a certified public accountant
or the Fund's Treasurer in any case where so doing reasonably appears to the
Accounting Agent to be necessary or desirable. The Accounting Agent shall not be
considered to have engaged in any misconduct or to have acted negligently and
shall be without liability in acting upon the advice of such certified public
accountant or of the Fund's Treasurer.
8. Termination of Agreement.
(a) This Agreement shall continue in full force and effect until
terminated by the Accounting Agent or the Fund by an instrument in writing
delivered or mailed, postage prepaid, to the other party, such termination to
take effect not sooner than ninety (90) calendar days after the date of such
delivery or mailing. In the event a termination notice is given by a party
hereto, all expenses associated with the movement of records and materials and
the conversion thereof shall be paid by the Fund for which services shall cease
to be performed hereunder. The Accounting Agent shall be responsible for
completing all actions in progress when such termination notice is given unless
otherwise agreed.
Notwithstanding anything in the foregoing provisions of this clause, if
it appears impracticable in the circumstances to effect an orderly delivery of
the necessary and appropriate records of the Accounting Agent to a successor
within the time specified in the notice of termination as aforesaid, the
Accounting Agent and the Fund agree that this Agreement shall remain in full
force and effect for such reasonable period as may be required to complete
necessary arrangements with a successor.
(b) If a party hereto shall fail to perform its duties and obligations
hereunder (a "Defaulting Party") resulting in material loss to another party
(the "Non-Defaulting Party"), the Non-Defaulting Party may give written notice
thereof to the Defaulting Party, and if such material breach shall not have been
remedied within thirty (30) calendar days after such written notice is given,
then the Non-Defaulting Party may terminate this Agreement by giving thirty (30)
calendar days' written notice of such termination to the Defaulting Party. If
the Accounting Agent is the Non-Defaulting Party, its termination of this
Agreement shall not constitute a waiver of any other rights or remedies of the
Accounting Agent with respect to payment for services performed prior to such
termination or rights of the Accounting Agent to be reimbursed for out-of-pocket
expenses. In all cases, termination by the Non
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Defaulting Party shall not constitute a waiver by the Non-Defaulting Party of
any other rights it might have under this Agreement or otherwise against the
Defaulting Party.
(c) This Section 8 shall survive any termination of this Agreement,
whether for cause or not for cause.
9. Amendment of this Agreement. This Agreement constitutes the entire
understanding and agreement of the parties hereto with respect to the subject
matter hereof. No provision of this Agreement may be amended or terminated
except by a statement in writing signed by the party against which enforcement
of the amendment or termination is sought.
In connection with the operation of this Agreement, the Fund and the
Accounting Agent may agree in writing from time to time on such provisions
interpretive of or in addition to the provisions of this Agreement as may in
their joint opinion be consistent with the general tenor of this Agreement. No
interpretive or additional provisions made as provided in the preceding sentence
shall be deemed to be an amendment of this Agreement.
In the event any provision of this Agreement is determined to be void
or unenforceable, such determination shall not affect the remainder of this
Agreement, which shall continue to be in force.
The section headings and the use of defined terms in the singular or
plural tenses in this Agreement are for the convenience of the parties and in no
way alter, amend, limit or restrict the contractual obligations of the parties
set forth in this Agreement.
10. GOVERNING LAW AND JURISDICTION. THIS AGREEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH, AND BE GOVERNED BY THE LAWS OF, THE STATE OF NEW YORK,
WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW OF SUCH STATE. THE PARTIES HERETO
IRREVOCABLY CONSENT TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF
NEW YORK AND THE FEDERAL COURTS LOCATED IN NEW YORK CITY IN THE BOROUGH OF
MANHATTAN.
11. Notices. Notices and other writings delivered or mailed postage
prepaid to the Fund addressed to the Fund, c/o PIMCO Advisors Fund Management
LLC at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx
Xxxxxxxx or to such other address as the Fund may have designated to the
Accounting Agent in writing, or to the Accounting Agent at 00 Xxxxx Xxxxxx,
Xxxxxx, XX 00000, Attention: Manager, Fund Accounting Department, or to such
other address as the Accounting Agent may have designated to the Fund in
writing, shall be deemed to have been properly delivered or given hereunder to
the respective addressee.
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12. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the Fund and the Accounting Agent and their respective successors
and assigns, provided that no party hereto may assign this Agreement or any of
its rights or obligations hereunder without the written consent of the other
party.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, and which
collectively shall be deemed to constitute only one instrument. This Agreement
shall become effective when one or more counterparts have been signed and
delivered by each of the parties.
14. Exclusivity. The services furnished by the Accounting Agent
hereunder are not to be deemed exclusive, and the Accounting Agent shall be free
to furnish similar services to others.
15. Authorization. The Fund hereby represents and warrants that the
execution and delivery of this Agreement have been authorized by the Fund's
Board of Trustees and that this Agreement has been signed by an authorized
officer of the Fund.
16. Limitation of Liability of the Fund's Trustees and Shareholders. A
copy of the Agreement and Declaration of Trust of the Fund is on file with the
Secretary of State of The Commonwealth of Massachusetts, and notice is hereby
given that this instrument is executed on behalf of the Trustees of the Fund as
Trustees and not individually and that the obligations of this instrument are
not binding upon any of the Trustees or shareholders individually but are
binding only upon the assets and property of the Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their duly authorized officers as of the date
first written above.
XXXXX BROTHERS XXXXXXXX & CO. XXXXXXXX-XXXXXXXXX CONVERTIBLE &
INCOME FUND II
By: __________________________________ By: _____________________________
Name: Name:
Title: Title:
0
XXXXXXXX X
THE FOLLOWING AUTHORIZED SOURCES ARE TO BE USED FOR PRICING AND FOREIGN EXCHANGE
QUOTATIONS, CORPORATE ACTIONS, DIVIDENDS AND RIGHTS OFFERINGS:
AUTHORIZED SOURCES
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BLOOMBERG
FUND MANAGERS
FT INTERACTIVE DATA CORPORATION
REPUTABLE BROKERS
REUTERS
SUBCUSTODIAN BANKS
TELEKURS
REPUTABLE FINANCIAL PUBLICATIONS
STOCK EXCHANGES
FINANCIAL INFORMATION INC. CARD
XX XXXXX
FRI CORPORATION
XXXXXXX XXXXX PRICING SERVICE
BRIDGE
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