Pioneer Protected Principal Trust
c/o Pioneer Investment Management, Inc.
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
February 26, 2003
Xxxxx Brothers Xxxxxxxx & Co.
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxx Xxxxxx
Re: PIONEER PROTECTED PRINCIPAL PLUS FUND II
Ladies and Gentlemen:
Pursuant to the terms of the Custodian Contract, dated as of
July 1, 2001, as amended from time to time (the "Contract"), between Pioneer
Protected Principal Plus Fund II (the "FUND") and Xxxxx Brothers Xxxxxxxx & Co.
(the "CUSTODIAN"), the undersigned Pioneer Protected Principal Trust (the
"TRUST") on behalf of the Fund hereby authorizes and directs the Custodian to
follow and act upon any instructions delivered from time to time to the
Custodian by Ambac Assurance Corporation ("AMBAC") with respect to the
liquidation of the assets of the Fund and the investment of the Fund's assets in
the Defeasance Portfolio (as defined below) (each, an "AMBAC INSTRUCTION")
Each Ambac Instruction shall be deemed to constitute proper
"Instructions" pursuant to Section 4 of the Contract. Further, this letter
itself constitutes a proper "Instruction" pursuant to Section 4 of the Contract
and shall be a standing Instruction, effective as of the date of this letter and
until the Trust and Ambac jointly instruct the Custodian otherwise in writing.
The persons listed on Appendix A shall be "AUTHORIZED PERSONS" pursuant to
Section 4 of the Contract with authority to issue an Ambac Instruction.
"DEFEASANCE PORTFOLIO" means an earmarked portfolio of
investments consisting of (i) zero coupon U.S. Treasury bonds having a par
amount equal to the Guarantee Amount (as defined in the Financial Guarantee
Agreement, dated as of February 26, 2003, among Pioneer Investment Management,
Inc., the Trust on behalf of the Fund, and Ambac, as amended from time to time
(the "AGREEMENT")) and that mature on a date as close to the Maturity Date (as
defined in the Agreement) as practicable but in any event no later than the
Maturity Date, and, following the maturity of such zero coupon U.S. Treasury
bonds, cash, (ii) a portfolio of zero coupon U.S. Treasury bonds that mature on
various dates which correspond as closely as reasonably practicable to the
expected payment dates of the expected fees and expenses of the Fund, and (iii)
cash.
In the event that the Custodian receives any Ambac Instruction
which, in the reasonable belief of the Custodian, conflicts in any way (in whole
or in part) with any other outstanding instruction to the Custodian regarding
the Fund's assets issued by the Trust, any investment advisor to the Trust or
the Fund or any other party (each, an "OTHER INSTRUCTION"), the Custodian shall
be entitled to rely upon the Ambac Instruction and further, the Custodian is
hereby authorized and directed to disregard the Other Instruction and instead,
follow and act upon the Ambac Instruction.
The Trust, on behalf of the Fund, hereby confirms to and
agrees with the Custodian that, as a condition of any obligation of the
Custodian hereunder, the Trust shall at all times do, make, execute and deliver
(and shall likewise use its best efforts to cause Ambac to do, make, execute and
deliver) all such additional and further acts, instruments and documents as the
Custodian may at any time reasonably request (each in form and substance
satisfactory to the Custodian) in connection with these instructions and any
Ambac Instruction including, without limitation, the execution and delivery of
(a) modifications to the list of Authorized Persons of the Trust and Ambac duly
authorized by the Fund's Board; (b) funds transfer security procedure
documentation regarding each of the Fund and Ambac; and (c) remote access
services documentation.
The undersigned Trust, on behalf of the Fund, hereby
acknowledges that, except as may arise from the Custodian's own negligence or
willful misconduct, the Custodian shall be without liability to the Fund for any
loss, liability, claim or expense resulting from or caused by the Custodian's
acting in accordance with this letter of instruction and/or any Ambac
Instruction, and/or the Custodian's disregarding any Other Instruction. The
Trust, on behalf of the Fund, agrees to indemnify the Custodian for any loss,
liability, claim or expense incurred by the Custodian, except as may arise from
the Custodian's own negligence or willful misconduct, in connection with actions
omitted or taken by the Custodian pursuant to each of this letter of instruction
and/or any Ambac Instruction.
Please sign below to evidence your receipt of this letter and
to acknowledge that, as Custodian, you will follow, pursuant to the terms of
this instruction letter and in accordance with the governing standard of care
set forth in the Contract, any Ambac Instruction.
PIONEER PROTECTED PRINCIPAL TRUST
On behalf of its series Pioneer Protected Principal
Plus Fund II
By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Its: Executive Vice President
Acknowledged and Agreed:
XXXXX BROTHERS XXXXXXXX & CO.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Partner
