AGREEMENT BETWEEN
XXXXX BROTHERS XXXXXXXX & CO.
AND
PIONEER II
CUSTODIAN AGREEMENT
AGREEMENT made this 23rd day of December, 1991 between PIONEER II (the "Fund")
and Xxxxx Brothers Xxxxxxxx & Co. (the "Custodian");
WITNESSETH: That in consideration of the mutual covenants and agreements herein
contained, the parties hereto agree as follows:
1. Employment of Custodian: The Fund hereby employs and appoints the Custodian
as a custodian for the term and subject to the provisions of this Agreement. The
Custodian shall not be under any duty or obligation to require the Fund to
deliver to it any securities or funds owned by the Fund and shall have no
responsibility or liability for or on account of securities or funds not so
delivered. The Fund will deposit with the Custodian copies of the Declaration of
Trust or Certificate of Incorporation and By-Laws (or comparable documents) of
the Fund and all amendments thereto, and copies of such votes and other
proceedings of the Fund as may be necessary for or convenient to the Custodian
in the performance of its duties.
2. Powers and Duties of the Custodian with respect to Property of the Fund held
by the Custodian: Except for securities and funds held by any Subcustodians or
held by the Custodian through a non-U.S. securities depository appointed
pursuant to the provisions of Section 3 hereof, the Custodian shall have and
perform the following powers and duties:
A. Safekeeping - To keep safely the securities and other assets of the Fund that
have been delivered to the Custodian and, on behalf of the Fund, from time to
time to receive delivery of securities for safekeeping.
B. Manner of Holding Securities - To hold securities of the Fund (1) by physical
possession of the share certificates or other instruments representing such
securities in registered or bearer form, or (2) in book-entry form by a
Securities System (as said term is defined in Section 2U).
C. Registered Name; Nominee - To hold registered securities of the Fund (1) in
the name or any nominee name of the Custodian or the Fund, or in the name or any
nominee name of any Agent appointed pursuant to Section 6F, or (2) in street
certificate form, so-called, and in any case with or without any indication of
fiduciary capacity, provided that securities are held in an account of the
Custodian containing only assets of the Fund or only assets held as fiduciary or
custodian for customers.
D. Purchases - Upon receipt of Proper Instructions, as defined in Section X on
Page 16, insofar as funds are available for the purpose, to pay for and receive
securities purchased for the account of the Fund, payment being made only upon
receipt of the securities (1) by the Custodian, or (2) by a clearing corporation
of a national securities exchange of which the Custodian is a member, or (3) by
a Securities System. However, (i) in the case of repurchase agreements entered
into by the Fund, the Custodian (as well as an Agent) may release funds to a
Securities System or to a Subcustodian prior to the receipt of advice from the
Securities System or Subcustodian that the securities underlying such repurchase
agreement have been transferred by book entry into the Account (as defined in
Section 2U) of the Custodian (or such Agent) maintained with such Securities
System or Subcustodian, so long as such payment instructions to the Securities
System or Subcustodian include a requirement that delivery is only against
payment for securities, (ii) in the case of foreign exchange contracts, options,
time deposits, call account deposits, currency deposits, and other deposits,
contracts or options pursuant to Sections 2J, 2L, 2M and 2N, the Custodian may
make payment therefor without receiving an instrument evidencing said deposit,
contract or option so long as such payment instructions detail specific
securities to be acquired, and (iii) in the case of securities in which payment
for the security and receipt of the instrument evidencing the security are under
generally accepted trade practice or the terms of the instrument representing
the security expected to take place in different locations or through separate
parties, such as commercial paper which is indexed to foreign currency exchange
rates, derivatives and similar securities, the Custodian may make payment for
such securities prior to delivery thereof in accordance with such generally
accepted trade practice or the terms of the instrument representing such
security.
E. Exchanges - Upon receipt of proper instructions, to exchange securities held
by it for the account of the Fund for other securities in connection with any
reorganization, recapitalization, split-up of shares, change of par value,
conversion or other event relating to the securities or the issuer of such
securities and to deposit any such securities in accordance with the terms of
any reorganization or protective plan. Without proper instructions, the
Custodian may surrender securities in temporary form for definitive securities,
may surrender securities for transfer into a name or nominee name as permitted
in Section 2C, and may surrender securities for a different number of
certificates or instruments representing the same number of shares or same
principal amount of indebtedness, provided the securities to be issued are to be
delivered to the Custodian.
F. Sales of Securities - Upon receipt of proper instructions, to make delivery
of securities which have been sold for the account of the Fund, but only against
payment therefor (1) in cash, by a certified check, bank cashier's check, bank
credit, or bank wire transfer, or (2) by credit to the account of the Custodian
with a clearing corporation of a national securities exchange of which the
Custodian is a member, or (3) by credit to the account of the Custodian or an
Agent of the Custodian with a Securities System; provided, however, that (i) in
the case of delivery of physical certificates or instruments representing
securities, the Custodian may make delivery to the broker buying the securities,
against receipt therefor, for examination in accordance with "street delivery"
custom, provided that the payment therefor is to be made to the Custodian (which
payment may be made by a broker's check) or that such securities are to be
returned to the Custodian, and (ii) in the case of securities referred to in
clause (iii) of the last sentence of Section 2D, the Custodian may make
settlement, including with respect to the form of payment, in accordance with
generally accepted trade practice relating to such securities or the terms of
the instrument representing said security.
G. Depositary Receipts - Upon receipt of proper instructions, to instruct a
Subcustodian or an Agent to surrender securities to the depositary used by an
issuer of American Depositary Receipts or International Depositary Receipts
(hereinafter collectively referred to as "ADRs") for such securities against a
written receipt therefor adequately describing such securities and written
evidence satisfactory to the Subcustodian or Agent that the depositary has
acknowledged receipt of instructions to issue with respect to such securities
ADRs in the name of the Custodian, or a nominee of the Custodian, for delivery
to the Custodian in Boston, Massachusetts, or at such other place as the
Custodian may from time to time designate.
Upon receipt of proper instructions, to surrender ADRs to the issuer thereof
against a written receipt therefor adequately describing the ADRs surrendered
and written evidence satisfactory to the Custodian that the issuer of the ADRs
has acknowledged receipt of instructions to cause its depositary to deliver the
securities underlying such ADRs to a Subcustodian or an Agent.
H. Exercise of Rights; Tender Offers - Upon timely receipt of proper
instructions, to deliver to the issuer or trustee thereof, or to the agent of
either, warrants, puts, calls, rights or similar securities for the purpose of
being exercised or sold, provided that the new securities and cash, if any,
acquired by such action are to be delivered to the Custodian, and, upon receipt
of proper instructions, to deposit securities upon invitations for tenders of
securities, provided that the consideration is to be paid or delivered or the
tendered securities are to be returned to the Custodian.
I. Stock Dividends, Rights, Etc. - To receive and collect all stock dividends,
rights and other items of like nature; and to deal with the same pursuant to
proper instructions relative thereto.
J. Options - Upon receipt of proper instructions, to receive and retain
confirmations or other documents evidencing the purchase of writing of an option
on a security or securities index by the Fund; to deposit and maintain in a
segregated account, either physically or by book-entry in a Securities System,
securities subject to a covered call option written by the Fund; and to release
and/or transfer such securities or other assets only in accordance with the
provisions of any agreement among the Fund, the Custodian and a broker-dealer
relating to such securities or other assets a notice or other communication
evidencing the expiration, termination or exercise of such covered option
furnished by The Options Clearing Corporation, the securities or options
exchange on which such covered option is traded or such other organization as
may be responsible for handling such options transactions.
K. Borrowings - Upon receipt of proper instructions, to deliver securities of
the Fund to lenders or their agents as collateral for borrowings effected by the
Fund, provided that such borrowed money is payable to or upon the Custodian's
order as Custodian for the Fund.
L. Demand Deposit Bank Accounts - To open and operate an account or accounts in
the name of the Fund on the Custodian's books subject only to draft or order by
the Custodian. All funds received by the Custodian from or for the account of
the Fund shall be deposited in said account(s). The responsibilities of the
Custodian to the Fund for deposits accepted on the Custodian's books shall be
that of a U. S. bank for a similar deposit.
If and when authorized by proper instructions, the Custodian may open and
operate an additional account(s) in such other banks or trust companies as may
be designated by the Fund in such instructions (any such bank or trust company
so designated by the Fund being referred to hereafter as a "Banking
Institution"), provided that such account(s) (hereinafter collectively referred
to as "demand deposit bank accounts") shall be in the name of the Custodian for
account of the Fund and subject only to the Custodian's draft or order. Such
demand deposit accounts may be opened with Banking Institutions in the United
States and in other countries and may be denominated in either U. S. Dollars or
other currencies as the Fund may determine. All such deposits shall be deemed to
be portfolio securities of the Fund and accordingly the responsibility of the
Custodian therefore shall be the same as and no greater than the Custodian's
responsibility in respect of other portfolio securities of the Fund.
M. Interest Bearing Call or Time Deposits - To place interest bearing fixed term
and call deposits with such banks and in such amounts as the Fund may authorize
pursuant to proper instructions. Such deposits may be placed with the Custodian
or with Subcustodians or other Banking Institutions as the Fund may determine.
Deposits may be denominated in U. S. Dollars or other currencies and need not be
evidenced by the issuance or delivery of a certificate to the Custodian,
provided that the Custodian shall include in its records with respect to the
assets of the Fund appropriate notation as to the amount and currency of each
such deposit, the accepting Banking Institution and other appropriate details,
and shall retain such forms of advice or receipt evidencing the deposit, if any,
as may be forwarded to the Custodian by the Banking Institution. Such deposits,
other than those placed with the Custodian, shall be deemed portfolio securities
of the Fund and the responsibilities of the Custodian therefor shall be the same
as those for demand deposit bank accounts placed with other banks, as described
in Section K of this Agreement. The responsibility of the Custodian for such
deposits accepted on the Custodian's books shall be that of a U. S. bank for a
similar deposit.
N. Foreign Exchange Transactions and Futures Contracts Pursuant to proper
instructions, to enter into foreign exchange contracts or options to purchase
and sell foreign currencies for spot and future delivery on behalf and for the
account of the Fund. Such transactions may be undertaken by the Custodian with
such Banking Institutions, including the Custodian and Subcustodian(s) as
principals, as approved and authorized by the Fund. Foreign exchange contracts
and options other than those executed with the Custodian, shall be deemed to be
portfolio securities of the Fund and the responsibilities of the Custodian
therefor shall be the same as those for demand deposit bank accounts placed with
other banks as described in Section 2L of this agreement. Upon receipt of proper
instructions, to receive and retain confirmations evidencing the purchase or
sale of a futures contract or an option on a futures contract by the Fund; to
deposit and maintain in a segregated account, for the benefit of any futures
commission merchant or to pay to such futures commission merchant, assets
designated by the fund as initial, maintenance or variation "margin" deposits
intended to secure the Fund's performance of its obligations under any futures
contracts purchased or sold or any options on futures contracts written by the
Fund, in accordance with the provisions of any agreement or agreements among any
of the Fund, the Custodian and such futures commission merchant, designated to
comply with the rules of the Commodity Futures Trading Commission and/or any
contract market, or any similar organization or organizations, regarding such
margin deposits; and to release and/or transfer assets in such margin accounts
only in accordance with any such agreements or rules.
0. Stock Loans - Upon receipt of proper instructions, to deliver securities of
the Fund, in connection with loans of securities by the Fund, to the borrower
thereof prior to receipt of the collateral, if any, for such borrowing, provided
that for stock loans secured by cash collateral the Custodian's instructions to
the Securities System require that the Securities System may deliver the
securities to the borrower thereof only upon receipt of the collateral for such
borrowing.
P. Collections - To collect, receive and deposit in said account or accounts all
income, payments of principal and other payments with respect to the securities
held hereunder, and in connection therewith to deliver the certificates or other
instruments representing the securities to the issuer thereof or its agent when
securities are called, redeemed, retired or otherwise become payable; provided,
that the payment is to be made in such form and manner and at such time, which
may be after delivery by the Custodian of the instrument representing the
security, as is in accordance with the terms of the instrument representing the
security, or such proper instructions as the Custodian may receive, or
governmental regulations, the rules of Securities Systems or other U.S.
securities depositories and clearing agencies or, with respect to securities
referred to in clause (iii) of the last sentence of Section 2D, in accordance
with generally accepted trade practice; (ii) to execute ownership and other
certificates and affidavits for all federal and state tax purposes in connection
with receipt of income or other payments with respect to securities of the Fund
or in connection with transfer of securities, and (iii) pursuant to proper
instructions to take such other actions with respect to collection or receipt of
funds or transfer of securities which involve an investment decision.
Q. Dividends, Distributions and Redemptions - Upon receipt of proper
instructions from the Fund, or upon receipt of instructions from the Fund's
shareholder servicing agent or agent with comparable duties (the "Shareholder
Servicing Agent") (given by such person or persons and in such manner on behalf
of the Shareholder Servicing Agent as the Fund shall have authorized), the
Custodian shall release funds or securities to the Shareholder Servicing Agent
or otherwise apply funds or securities, insofar as available, for the payment of
dividends or other distributions to Fund shareholders. Upon receipt of proper
instructions from the Fund, or upon receipt of instructions from the Shareholder
Servicing Agent (given by such person or persons and in such manner on behalf of
the Shareholder Servicing Agent as the Fund shall have authorized), the
Custodian shall release funds or securities, insofar as available, to the
Shareholder Servicing Agent or as such Agent shall otherwise instruct for
payment to Fund shareholders who have delivered to such Agent a request for
repurchase or redemption of their shares of capital stock of the Fund.
R. Proxies, Notices, Etc. - Promptly to deliver or mail to the Fund all forms of
proxies and all notices of meetings and any other notices or announcements
affecting or relating to securities owned by the Fund that are received by the
Custodian, and upon receipt of proper instructions, to execute and deliver or
cause its nominee to execute and deliver such proxies or other authorizations as
may be required. Neither the Custodian nor its nominee shall vote upon any of
such securities or execute any proxy to vote thereon or give any consent or take
any other action with respect thereto (except as otherwise herein provided)
unless ordered to do so by proper instructions.
S. Nondiscretionary Details - Without the necessity of express authorization
from the Fund, (1) to attend to all nondiscretionary details in connection with
the sale, exchange, substitution, purchase, transfer or other dealings with
securities, funds or other property of the Portfolio held by the Custodian
except as otherwise directed from time to time by the Directors or Trustees of
the Fund, and (2) to make payments to itself or others for minor expenses of
handling securities or other similar items relating to the Custodian's duties
under this Agreement, provided that all such payments shall be accounted for to
the Fund.
T. Bills - Upon receipt of proper instructions, to pay or cause to be paid,
insofar as funds are available for the purpose,, bills, statements, or other
obligations of the Fund.
U. Deposit of Fund Assets in Securities Systems - The Custodian may deposit
and/or maintain securities owned by the Fund in (i) The Depository Trust
Company, (ii) any book-entry system as provided in Subpart 0 of Treasury
Circular Xx. 000, 00 XXX 000, Xxxxxxx X of 31 CFR Part 350, or the book-entry
regulations of federal agencies substantially in the form of Subpart 0, or (iii)
any other domestic clearing agency registered with the Securities and Exchange
Commission under Section 17A of the Securities Exchange Act of 1934 which acts
as a securities depository and whose use the Fund has previously approved in
writing (each of the foregoing being referred to in this Agreement as a
"Securities System"). Utilization of a Securities System shall be in accordance
with applicable Federal Reserve Board and Securities and Exchange Commission
rules and regulations, if any, and subject to the following provisions:
1) The Custodian may deposit and/or maintain Fund securities, either directly or
through one or more Agents appointed by the Custodian (provided that any such
agent shall be qualified to act as a custodian of the Fund pursuant to the
Investment Company Act of 1940 and the rules and regulations thereunder), in a
Securities System provided that such securities are represented in an account
("Account") of the Custodian or such Agent in the Securities System which shall
not include any assets of the Custodian or Agent other than assets held as a
fiduciary, custodian, or otherwise for customers;
2) The records of the Custodian with respect to securities of the Fund which are
maintained in a Securities System shall identify by book-entry those securities
belonging to the Fund;
3) The Custodian shall pay for securities purchased for the account of the Fund
upon (i) receipt of advice from the Securities System that such securities have
been transferred to the Account, and (ii) the making of an entry on the records
of the Custodian to reflect such payment and transfer for the account of the
Fund. The Custodian shall transfer securities sold for the account of the Fund
upon (i) receipt of advice from the Securities System that payment for such
securities has been transferred to the Account, and (ii) the making of an entry
on the records of the Custodian to reflect such transfer and payment for the
account of the Fund. Copies of all advices from the Securities System of
transfers of securities for the account of the Fund shall identify the Fund, be
maintained for the Fund by the Custodian or an Agent as referred to above, and
be provided to the Fund at its request. The Custodian shall furnish the Fund
confirmation of each transfer to or from the account of the Fund in the form of
a written advice or notice and shall furnish to the Fund copies of daily
transaction sheets reflecting each day's transactions in the Securities System
for the account of the Fund on the next business day;
4) The Custodian shall provide the Fund with any report obtained by the
Custodian or any Agent as referred to above on the Securities System's
accounting system, internal accounting control and procedures for safeguarding
securities deposited in the Securities System; and the Custodian and such Agents
shall send to the Fund such reports on their own systems of internal accounting
control as the Fund may reasonably request from time to time.
5) At the written request of the Fund, the Custodian will terminate the use of
any such Securities System on behalf of the Fund as promptly as practicable.
V. Other Transfers - Upon receipt of proper instructions, to deliver securities,
funds and other property of the Fund to a Subcustodian or another custodian of
the Fund; and, upon receipt of proper instructions, to make such other
disposition of securities, funds or other property of the Fund in a manner other
than or for purposes other than as enumerated elsewhere in this Agreement,
provided that the instructions relating to such disposition shall include a
statement of the purpose for which the delivery is to be made, the amount of
securities to be delivered and the name of the person or persons to whom
delivery is to be made.
W. Investment Limitations - In performing its duties generally, and more
particularly in connection with the purchase, sale and exchange of securities
made by or for the Fund, the Custodian may assume unless and until notified in
writing to the contrary that proper instructions received by it are not in
conflict with or in any way contrary to any provisions of the Fund's Declaration
of Trust or Certificate of Incorporation or By-Laws (or comparable documents) or
votes or proceedings of the shareholders or Directors of the Fund. The Custodian
shall in no event be liable to the Fund and shall be indemnified by the Fund for
any violation which occurs in the course of carrying out instructions given by
the Fund of any investment limitations to which the Fund is subject or other
limitations with respect to the Fund's powers to make expenditures, encumber
securities, borrow or take similar actions affecting the Fund.
X. Proper Instructions - Proper instructions shall mean a tested telex from the
Fund or a written request, direction, instruction or certification signed or
initialled on behalf of the Fund by one or more person or persons as the Board
of Directors or Trustees of the Fund shall have from time to time authorized,
provided, however, that no such instructions directing the delivery of
securities or the payment of funds to an authorized signatory of the Fund shall
be signed by such person. Those persons authorized to give proper instructions
may be identified by the Board of Directors or 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 given by any one of the above
persons will be considered proper instructions if the Custodian reasonably
believes them to have been given by a person authorized to give such
instructions with respect to the transaction involved. Oral instructions will be
confirmed by tested telex or in writing in the manner set forth above but the
lack of such confirmation shall in no way affect any action taken by the
Custodian in reliance upon such oral instructions. The Fund authorizes the
Custodian to tape record any and all telephonic or other oral instructions given
to the Custodian by or on behalf of the Fund (including any of its officers,
Directors, Trustees, employees or agents) and will deliver to the Custodian a
similar authorization from any investment manager or adviser or person or entity
with similar reponsibilities which is authorized to give proper instructions on
behalf of the Fund to the Custodian. Proper instructions may relate to specific
transactions or to types or classes of transactions, and may be in the form of
standing instructions.
Proper instructions may include communications effected directly between
electromechanical or electronic devices or systems, in addition to tested telex,
provided that the Fund and the Custodian agree to the use of such device or
system.
Y. Segregated Account - The Custodian shall upon receipt of proper instructions
establish and maintain on its books a segregated account or accounts for and on
behalf of the Fund, into which account or accounts may be transferred cash
and/or securities of the Fund, including securities maintained by the Custodian
pursuant to Section 2U hereof, (i) in accordance with the provisions of any
agreement among the Fund, the Custodian and a broker-dealer registered under the
Securities Exchange Act of 1934 and a member of the National Association of
Securities Dealers, Inc. (or any futures commission merchant registered under
the Commodity Exchange Act) relating to compliance with the rules of the Options
Clearing Corporation and of any registered national securities exchange (or the
Commodity Futures Trading Commission or any registered contract market), or any
similar organization or organizations, regarding escrow or other arrangements in
connection with transactions by the Fund, (ii) for purposes of segregating cash
or securities in connection with options purchased, sold or written by the Fund
or commodity futures contracts or options thereon purchased or sold by the Fund,
(iii) for the purposes of compliance by the Fund with the procedures required by
Investment Company Act Release No. 10666, or any subsequent release or releases
of the Securities and Exchange Commission relating to the maintenance of
segregated accounts by registered investment companies, and (iv) as mutually
agreed from time to time between the Fund and the Custodian.
3. Powers and Duties of the Custodian with Respect to the Appointment of
Subcustodians: The Fund hereby authorizes and instructs the Custodian to hold
securities, funds and other property of the Fund which are maintained outside
the United States at subcustodians appointed pursuant to the provisions of this
Section 3 (a "Subcustodian"). The Fund shall approve in writing (1) the
appointment of each Subcustodian and the subcustodian agreement to be entered
into between such Subcustodian and the Custodian, and (2) if the Subcustodian is
organized under the laws of a country other than the United States, the country
or countries in which the Subcustodian is authorized to hold securities, cash
and other property of the Fund. The Fund hereby further authorizes and instructs
the Custodian and any Subcustodian to utilize such securities depositories
located outside the United States which are approved in writing by the Fund to
hold securities, cash and other property of the Fund. Upon such approval by the
Fund, the Custodian is authorized on behalf of the Fund to notify each
Subcustodian of its appointment as such. The Custodian may, at any time in its
discretion, remove any Subcustodian that has been appointed as such but will
promptly notify the Fund of any such action.
Those Subcustodians, and the countries where and the securities depositories
through which they or the Custodian may hold securities, cash and other property
of the Fund which the Fund has approved to date are set forth on Appendix A
hereto. Such Appendix shall be amended from time to time as Subcustodians,
and/or countries and/or securities depositories are changed, added or deleted.
The Fund shall be responsible for informing the Custodian sufficiently in
advance of a proposed investment which is to be held in a country not listed on
Appendix A, in order that there shall be sufficient time for the Fund to give
the approval required by the preceding paragraph and for the Custodian to put
the appropriate arrangements in place with such Subcustodian, including
negotiation of a subcustodian agreement and submission of such subcustodian
agreement to the Fund for approval.
If the Fund shall have invested in a security to be held in a country before the
foregoing procedures have been completed, such security shall be held by such
agent as the Custodian may appoint. In any event, the Custodian shall be liable
to the Fund for the actions of such agent if and only to the extent the
Custodian shall have recovered from such agent for any damages caused the Fund
by such agent. At the request of the Fund, Custodian agrees to remove any
securities held on behalf of the Fund by such agent, if practical, to an
approved Subcustodian. Under such circumstances Custodian will collect income
and respond to corporate actions on a best efforts basis.
With respect to securities and funds held by a Subcustodian, either directly or
indirectly (including by a securities depository or clearing agency),
notwithstanding any provision of this Agreement to the contrary, payment for
securities purchased and delivery of securities sold may be made prior to
receipt of the securities or payment, respectively, and securities or payment
may be received in a form, in accordance with governmental regulations, rules of
securities depositories and clearing agencies, or generally accepted trade
practice in the applicable local market.
In the event that any Subcustodian appointed pursuant to the provisions of this
Section 3 fails to perform any of its obligations under the terms and conditions
of the applicable subcustodian agreement, the Custodian shall use its best
efforts to cause such Subcustodian to perform such obligations. In the event
that the Custodian is unable to cause such Subcustodian to perform fully its
obligations thereunder, the Custodian shall forthwith upon the Fund's request
terminate such Subcustodian in accordance with the termination provisions under
the applicable subcustodian agreement and, if necessary or desirable, appoint
another subcustodian in accordance with the provisions of this Section 3. At the
election of the Fund, it shall have the right to enforce, to the extent
permitted by the subcustodian agreement and applicable law, the Custodian's
rights against any such Subcustodian for loss or damage caused the Fund by such
Subcustodian.
The Custodian will not amend any subcustodian agreement or agree to change or
permit any changes thereunder except upon the prior written approval of the
Fund.
The Custodian may, at any time in its discretion upon notification to the Fund,
terminate any Subcustodian of the Fund in accordance with the termination
provisions under the applicable Subcustodian Agreement, and at the written
request of the Fund, the Custodian will terminate any Subcustodian in accordance
with the termination provisions under the applicable Subcustodian Agreement.
If necessary or desirable, the Custodian may appoint another subcustodian to
replace a Subcustodian terminated pursuant to the foregoing provisions of this
Section 3, such appointment to be made upon approval of the successor
subcustodian by the Fund's Board of Directors or Trustees in accordance with the
provisions of this Section 3.
In the event the Custodian receives a claim from a Subcustodian under the
indemnification provisions of any subcustodian agreement, the Custodian shall
promptly give written notice to the Fund of such claim. No more than thirty days
after written notice to the Fund of the Custodian's intention to make such
payment, the Fund will reimburse the Custodian the amount of such payment except
in respect of any negligence or misconduct of the Custodian.
4. Assistance by the Custodian as to Certain Matters: The Custodian may assist
generally in the preparation of reports to Fund shareholders and others, audits
of accounts, and other ministerial matters of like nature.
5. Powers and Duties of the Custodian with Respect to its Role as Financial
Agent: The Fund hereby also appoints the Custodian as the Funds financial agent.
With respect to the appointment as financial agent, the Custodian shall have and
perform the following powers and duties:
A. Records - To create, maintain and retain such records relating to its
activities and obligations under this Agreement as are required under the
Investment Company Act of 1940 and the rules and regulations thereunder
(including Section 31 thereof and Rules 3la-1 and 3la-2 thereunder) and under
applicable Federal and State tax laws. All such records will be the property of
the Fund and in the event of termination of this Agreement shall be delivered to
the successor custodian.
B. Accounts - To keep books of account and render statements, including interim
monthly and complete quarterly financial statements, or copies thereof, from
time to time as reasonably requested by proper instructions.
C. Access to Records - The books and records maintained by the Custodian
pursuant to Sections 5A and 5B shall at all times during the Custodian's regular
business hours be open to inspection and audit by officers of, attorneys for and
auditors employed by the Fund and by employees and agents of the Securities and
Exchange Commission, provided that all such individuals shall observe all
security requirements of the Custodian applicable to its own employees having
access to similar records within the Custodian and such regulations as may be
reasonably imposed by the Custodian.
D. Disbursements - Upon receipt of proper instructions, to pay or cause to be
paid, insofar as funds are available for the purpose, bills, statements and
other obligations of the Fund (including but not limited to interest charges,
taxes, management fees, compensation to Fund officers and employees, and other
operating expenses of the Fund).
6. Standard of Care and Related Matters:
A. Liability of the Custodian with Respect to Proper
Instructions; Evidence of Authority, Etc. The Custodian shall not be liable for
any action taken or omitted in reliance upon proper instructions believed by it
to be genuine or upon any other written notice, request, direction, instruction,
certificate or other instrument believed by it to be genuine and signed by the
proper party or parties.
The Secretary or Assistant Secretary of the Fund shall certify to the Custodian
the names, signatures and scope of authority of all persons authorized to give
proper instructions or any other such notice, request, direction, instruction,
certificate or instrument on behalf of the Fund, the names and signatures of the
officers of the Fund, the name and address of the Shareholder Servicing Agent,
and any resolutions, votes, instructions or directions of the Fund's Board of
Directors or Trustees or shareholders. Such certificate may be accepted and
relied upon by the Custodian as conclusive evidence of the facts set forth
therein and may be considered in full force and effect until receipt of a
similar certificate to the contrary.
So long as and to the extent that it is in the exercise of reasonable care, the
Custodian shall not be responsible for the title, validity or genuineness of any
property or evidence of title thereto received by it or delivered by it pursuant
to this Agreement.
The Custodian shall be entitled, at the expense of the Fund, to receive and act
upon advice of (i) counsel regularly retained by the Custodian in respect of
custodian matters, (ii) counsel for the Fund, or (iii) such other counsel as the
Fund and the Custodian may agree upon, with respect to all matters, and the
Custodian shall be without liability for any action reasonably taken or omitted
pursuant to such advice.
B. Liability of the Custodian with Respect to Use of Securities System - With
respect to the portfolio securities, cash and other property of the Fund held by
a Securities System, the Custodian shall be liable to the Fund only for any loss
or damage to the Fund resulting from use of the Securities System if caused by
any negligence, misfeasance or misconduct of the Custodian or any of its agents
or of any of its or their employees or from any failure of the Custodian or any
such agent to enforce effectively such rights as it may have against the
Securities System. At the election of the Fund, it shall be entitled to be
subrogated to the rights of the Custodian with respect to any claim against the
Securities System or any other person which the Custodian may have as a
consequence of any such loss or damage to the Fund if and to the extent that the
Fund has not been made whole for any such loss or damage.
C. Liability of the Custodian with respect to Subcustodians The Custodian shall
be liable to the Fund for any loss or damage to the Fund caused by or resulting
from the acts or omissions of any Subcustodian to the extent that under the
terms set forth in the subcustodian agreement between the Custodian and the
Subcustodian (or in the subcustodian agreement between a Subcustodian and any
secondary Subcustodian), the Subcustodian (or secondary Subcustodian) has failed
to perform in accordance with the standard of conduct imposed under such
subcustodian agreement as determined in accordance with the law which is
adjudicated to govern such agreement and in accordance with any determination of
any court as to the duties of said Subcustodian pursuant to said agreement. The
Custodian shall also be liable to the Fund for its own negligence in
transmitting any instructions received by it from the Fund and for its own
negligence in connection with the delivery of any securities or funds held by it
to any Subcustodian.
D. Standard of Care; Liability; Indemnification - The Custodian shall be held
only to the exercise of reasonable care and diligence in carrying out the
provisions of this Agreement, provided that the Custodian shall not thereby be
required to take any action which is in contravention of any applicable law.
The Fund agrees to indemnify and hold harmless the Custodian and its nominees
from all claims and liabilities (including counsel fees) incurred or assessed
against it or its nominees in connection with the performance of this Agreement,
except such as may arise from its or its nominee's breach of the relevant
standard of conduct set forth in this Agreement. Without limiting the foregoing
indemnification obligation of the Fund, the Fund agrees to indemnify the
Custodian and any nominee in whose name portfolio securities or other property
of the Fund is registered against any liability the Custodian or such nominee
may incur by reason of taxes assessed to the Custodian or such nominee or other
costs, liability or expense incurred by the Custodian or such nominee resulting
directly or indirectly from the fact that portfolio securities or other property
of the Fund is registered in the name of the Custodian or such nominee.
It is also understood that the Custodian shall not be liable for any loss
involving any securities, currencies, deposits or other property of the Fund,
whether maintained by it, a Subcustodian, a securities depository, an agent of
the Custodian or a Subcustodian, a Securities System, or a Banking Institution,
or for any loss arising from a foreign currency transaction or contract, where
the loss results from a Sovereign Risk or where the entity maintaining such
securities, currencies, deposits or other property of the Fund, whether the
Custodian, a Subcustodian, a securities depository, an agent of the Custodian or
a Subcustodian, a Securities System or a Banking Institution, has exercised
reasonable care maintaining such property or in connection with the transaction
involving such property. A "Sovereign Risk" shall mean nationalization,
expropriation, devaluation, revaluation, confiscation, seizure, cancellation,
destruction or similar action by any governmental authority, de facto or de
jure; or enactment, promulgation, imposition or enforcement by any such
governmental authority of currency restrictions, exchange controls, taxes,
levies or other charges affecting the Fund's property; or acts of war,
terrorism, insurrection or revolution; or any other act or event beyond the
Custodian's control.
E. Reimbursement of Advances - The Custodian shall be entitled to receive
reimbursement from the Fund on demand, in the manner provided in Section 7, for
its cash disbursements, expenses and charges (including the fees and expenses of
any Subcustodian or any Agent) in connection with this Agreement, but excluding
salaries and usual overhead expenses.
F. Security for Obligations to Custodian - If the Fund shall require the
Custodian to advance cash or securities for any purpose for the benefit of the
Fund, including in connection with foreign exchange contracts or options
(collectively, an "Advance"), or if the Custodian or any nominee thereof shall
incur or be assessed any taxes, charges, expenses, assessments, claims or
liabilities in connection with the performance of this Agreement (collectively a
"Liability"), except such as may arise from its or such nominee's breach of the
relevant standard of conduct set forth in this Agreement, then in such event any
property at any time held for the account of the Fund by the Custodian or a
Subcustodian shall be security for such Advance or Liability and if the Fund
shall fail to repay or indemnify the Custodian promptly, the Custodian shall be
entitled to utilize available cash and to dispose of the Fund's property,
including securities, to the extent necessary to obtain reimbursement or
indemnification.
G. Appointment of Agents - The Custodian may at any time or times in its
discretion appoint (and may at any time remove) any other bank or trust company
as its agent (an "Agent") to carry out such of the provisions of this Agreement
as the Custodian may from time to time direct, provided, however, that the
appointment of such Agent (other than an Agent appointed pursuant to the third
paragraph of Section 3) shall not relieve the Custodian of any of its
responsibilities under this agreement.
X. Xxxxxx of Attorney - Upon request, the Fund shall deliver to the Custodian
such proxies, powers of attorney or other instruments as may be reasonable and
necessary or desirable in connection with the performance by the Custodian or
any Subcustodian of their respective obligations under this Agreement or any
applicable subcustodian agreement.
7. Compensation of the Custodian: The Fund shall pay the Custodian a custody fee
based on such fee schedule as may from time to time be agreed upon in writing by
the Custodian and the Fund. Such fee, together with all amounts for which the
Custodian is to be reimbursed in accordance with Section 6D, shall be billed to
the Fund in such a manner as to permit payment by a direct cash payment to the
Custodian.
8. Termination; Successor Custodian: This Agreement shall continue in full force
and effect until terminated by either party by an instrument in writing
delivered or mailed, postage prepaid, to the other party, such termination to
take effect not sooner than seventy five (75) days after the date of such
delivery or mailing. In the event of termination the Custodian shall be entitled
to receive prior to delivery of the securities, funds and other property held by
it all accrued fees and unreimbursed expenses the payment of which is
contemplated by Sections 6D and 7, upon receipt by the Fund of a statement
setting forth such fees and expenses.
In the event of the appointment of a successor custodian, it is agreed that the
funds and securities owned by the Fund and held by the Custodian or any
Subcustodian shall be delivered to the successor custodian, and the Custodian
agrees to cooperate with the Fund in execution of documents and performance of
other actions necessary or desirable in order to substitute the successor
custodian for the Custodian under this Agreement.
9. Amendment: 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 Custodian and the Fund
may agree in writing from time to time on such provisions interpretative 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 interpretative or
additional provisions made as provided in the preceding sentence shall be deemed
to be an amendment of this Agreement.
The section headings 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: This instrument is executed and delivered in The Commonwealth
of Massachusetts and shall be governed by and construed according to the laws of
said Commonwealth.
11. Notices: Notices and other writings delivered or mailed postage prepaid to
the Fund addressed to the Fund at 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000
or to such other address as the Fund may have designated to the Custodian in
writing, or to the Custodian at 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000,
Attention: Manager, Securities Department, or to such other address as the
Custodian may have designated to the Fund in writing, shall be deemed to have
been properly delivered or given hereunder to the respective addressee.
12. Binding Effect: This Agreement shall be binding on and shall inure to the
benefit of the Fund and the Custodian and their respective successors and
assigns, provided that neither party hereto may assign this Agreement or any of
its rights or obligations hereunder without the prior written consent of the
other party.
13. Counterparts: This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original. This Agreement shall become effective
when one or more counterparts have been signed and delivered by each of the
parties.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed
in its name and behalf on the day and year first above written.
PIONEER II XXXXX BROTHERS XXXXXXXX & CO.
By per pro
