AMENDMENT TO THE CUSTODIAN CONTRACT {PRIVATE}
AGREEMENT made by and between State Street Bank and Trust Company (the
"Custodian") and New York Venture, Inc. (the "Fund").
WHEREAS, the Custodian and the Fund are parties to a custodian contract
dated January 27, 1988 (the "Custodian Contract") governing the terms and
conditions under which the Custodian maintains custody of the securities and
other assets of the Fund; and
WHEREAS, the Custodian and the Fund desire to amend the Custodian
Contract to provide for the maintenance of the Fund's foreign securities, and
cash incidental to transactions in such securities, in the custody of certain
foreign banking institutions and foreign securities depositories acting as
sub-custodians in conformity with the requirements of Rule 17f-5 under the
Investment Company Act of 1940;
NOW THEREFORE, in consideration of the premises and covenants contained
herein, the Custodian and the Fund hereby amend the Custodian Contract by the
addition of the following terms and conditions:
1. Appointment of Foreign Sub-Custodians.
The Fund hereby authorizes and instructs the Custodian to employ as
sub-custodians for the Fund's securities and other assets maintained
outside the United States the foreign banking institutions and foreign
securities depositories designated on Schedule A hereto ("foreign
sub-custodians"). Upon receipt of "Proper Instructions", as defined in
Section 2.17 of the Custodian Contract, together with a certified
resolution of the Fund's Board of Directors, the Custodian and the Fund
may agree to amend Schedule A hereto from time to time to designate
additional foreign banking institutions and foreign securities
depositories to act as sub-custodian. Upon receipt of Proper
Instructions, the Fund may instruct the Custodian to cease the
employment of any one or more such sub-custodians for maintaining
custody of the Fund's assets.
2. Assets to be Held.
The Custodian shall limit the securities and other assets maintained in
the custody of the foreign sub-custodians to: (a) "foreign securities",
as defined in paragraph (c)(1) of Rule 17f-5 under the Investment
Company Act of 1940, and (b) cash and cash equivalents in such amounts
as the Custodian or the Fund may determine to be
reasonably necessary to effect the Fund's foreign securities
transactions. The Custodian shall identify on its books as belonging to
the Fund, the foreign securities of the Fund held by each foreign
sub-custodian.
3. Foreign Securities Systems.
Except as may otherwise be agreed upon in writing by the Custodian and
the Fund, assets of the Funds shall be maintained in a clearing agency
which acts as a securities depository or in a book-entry system for the
central handling of securities located outside of the United States
(each a "Foreign Securities System") only through arrangements
implemented by the foreign banking institutions serving as
sub-custodians pursuant to the terms hereof. Where possible, such
arrangements shall include entry into agreements containing the
provisions set forth in Section 5 hereof.
4. Segregation of Securities.
The Custodian shall identify on its books as belonging to each
applicable Portfolio of the Fund, the foreign securities of such
Portfolios of the Fund held be each foreign sub-custodian. Each
agreement pursuant to which the Custodian employs a foreign banking
institution shall require that such institution establish a custody
account for the Custodian on behalf of the Fund for each applicable
Portfolio of the Fund and physically segregate in each account,
securities and other assets of the Portfolios, and, in the event that
such institution deposits securities of one or more of the Portfolios
in a foreign securities depository, that it shall identify on its books
as belonging to the Custodian, as agent for each applicable Portfolio,
the securities so deposited.
5. Agreements with Foreign Banking Institutions.
Each agreement with a foreign banking institution shall provide that:
(a) the Fund's assets will not be subject to any right, charge,
security interest, lien or claim of any kind in favor of the foreign
banking institution or its creditors or agent, except a claim of
payment for their safe custody or administration; (b) beneficial
ownership of the Fund's assets will be freely transferable without the
payment of money or value other than for custody or administration; (c)
adequate records will be maintained by the Custodian identifying the
assets as belonging to the Fund; (d) officers of or auditors employed
by, or other representatives of the Custodian, including to the extent
permitted under applicable law the independent public accountants for
the Fund, will be given access to the books and records of the foreign
banking institution relating to
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its actions under its agreement with the Custodian; and (e) assets of
the Fund held by the foreign sub-custodian will be subject only to the
instructions of the Custodian or its agents.
6. Access of Independent Accountants of the Fund.
Upon request of the Fund, the Custodian will use its best efforts to
arrange for the independent accountants of the Fund to be afforded
access to the books and records of any foreign banking institution
employed as a foreign sub-custodian insofar as such books and records
relate to the performance of such foreign banking institution under its
agreement with the Custodian.
7. Reports by Custodian.
The Custodian will supply to the Fund from time to time, as mutually
agreed upon, statements in respect of the securities and other assets
of the Fund held by foreign sub-custodians, including but not limited
to an identification of entities having possession of the Fund's
securities and other assets and advices or notifications of any
transfers of securities to or from each custodial account maintained by
a foreign banking institution for the Custodian on behalf of its
customers indicating, as to securities acquired for the Fund, the
identity of the entity having physical possession of such securities.
8. Transactions in Foreign Custody Account.
(a) Except as otherwise provided in paragraph (b) of this Section 8,
the provision of Sections 2.2 and 2.7 of the Custodian Contract
shall apply, mutatis mutandis to the foreign securities of the Fund
held outside the United States by foreign sub-custodians.
(b) Notwithstanding any provision of the Custodian Contract to the
contrary, settlement and payment for securities received for the
account of the Fund and delivery of securities maintained for the
account of the Fund may be effected in accordance with the
customary established securities trading or securities processing
practices and procedures in the jurisdiction or market in which the
transaction occurs, including, without limitation, delivering
securities to the purchaser thereof or to a dealer therefor (or an
agent for such purchaser or dealer) against a receipt with the
expectation of receiving later payment for such securities from
such purchaser or dealer.
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(c) Securities maintained in the custody of a foreign sub-custodian may
be maintained in the name of such entity's nominee to the same
extent as set forth in Section 2.3 of the Custodian Contract, and
the Fund agrees to hold any such nominee harmless from any
liability as a holder of record of such securities.
9. Liability of Foreign Sub-Custodians.
Each agreement pursuant to which the Custodian employs a foreign
banking institution as a foreign sub-custodian shall require the
institution to exercise reasonable care in the performance of its
duties and to indemnify, and hold harmless, the Custodian and the Fund
from and against any loss, damage, cost, expense, liability or claim
arising out of or in connection with the institution's performance of
such obligations. At the election of the Fund, it shall be entitled to
be subrogated to the rights of the Custodian with respect to any claims
against a foreign banking institution as a consequence of any such
loss, damage, cost, expense, liability or claim if and to the extent
that the Fund has not been made whole for any such loss, damage, cost,
expense, liability or claim.
10. Liability of Custodian.
The Custodian shall be liable for the acts or omissions of a foreign
banking institution to the same extent as set forth with respect to
sub-custodians generally in the Custodian Contract and, regardless of
whether assets are maintained in the custody of a foreign banking
institution, a foreign securities depository or a branch of a U.S. bank
as contemplated by paragraph 13 hereof, the Custodian shall not be
liable for any loss, damage, cost, expense, liability or claim
resulting from nationalization, expropriation, currency restrictions,
or acts of war or terrorism or any loss where the sub-custodian has
otherwise exercised reasonable care. Notwithstanding the foregoing
provisions of this paragraph 10, in delegating custody duties to State
Street London Ltd., the Custodian shall not be relieved of any
responsibility to the Fund for any loss due to such delegation, except
such loss as may result from (a) political risk (including, but not
limited to, exchange control restrictions, confiscation, expropriation,
nationalization, insurrection, civil strife or armed hostilities) or
(b) other losses (excluding a bankruptcy or insolvency of State Street
London Ltd. not caused by political risk) due to Acts of God, nuclear
incident or other losses under circumstances where the Custodian and
State Street London Ltd. have exercised reasonable care.
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11. Reimbursement for Advances.
If the Fund requires the Custodian to advance cash or securities for
any purpose including the purchase or sale of foreign exchange or of
contracts for foreign exchange, or in the event that the Custodian or
its nominee shall incur or be assessed any taxes, charges, expenses,
assessments, claims or liabilities in connection with the performance
of this Contract, except such as may arise from its or its nominee's
own negligent action, negligent failure to act or willful misconduct,
any property at any time held for the account of the Fund shall be
security therefor and should the Fund fail to repay the Custodian
promptly, the Custodian shall be entitled to utilize available cash and
to dispose of such Fund assets to the extent necessary to obtain
reimbursement.
12. Monitoring Responsibilities.
The Custodian shall furnish annually to the Fund, during the month of
June, information concerning the foreign sub-custodians employed by the
Custodian. Such information shall be similar in kind and scope to that
furnished to the Fund in connection with the initial approval of the
Custodian Contract. In addition, the Custodian will promptly inform the
Fund in the event that the Custodian learns of a material adverse
change in the financial condition of a foreign sub-custodian or any
material loss of the assets of the Fund or in the case of any foreign
sub-custodian not the subject of an exemptive order from the Securities
and Exchange Commission is notified by such foreign sub-custodian that
there appears to be a substantial likelihood that its shareholders'
equity will decline below $200 million (U.S. dollars or the equivalent
thereof) or that its shareholders' equity has declined below $200
million (in each case computed in accordance with generally accepted
U.S. accounting principles).
13. Branches of U.S. Banks.
(a) Except as otherwise set forth in this amendment to the Custodian
Contract, the provisions hereof shall not apply where the custody
of the Funds assets is maintained in a foreign branch of a banking
institution which is a "bank" as defined by Section 2(a)(5) of the
Investment Company Act of 1940 meeting the qualification set forth
in Section 26(a) of said Act. The appointment of any such branch as
a sub-custodian shall be governed by paragraph 1 of the Custodian
Contract.
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(b) Cash held for the Fund in the United Kingdom shall be maintained in
an interest bearing account established for the Fund with the
Custodian's London branch, which account shall be subject to the
direction of the Custodian, State Street London Ltd. or both.
14. Applicability of Custodian Contract.
Except as specifically superseded or modified herein, the terms and
provisions of the Custodian Contract shall continue to apply with full
force and effect.
IN WITNESS WHEREOF, each of the parties has caused this instrument to
be executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the ___ day of _________________, 1988.
ATTEST NEW YORK VENTURE FUND, INC.
By:
----------------------------- -----------------------------
ATTEST STATE STREET BANK AND TRUST COMPANY
By:
----------------------------- -----------------------------
Vice President
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Schedule A
The following foreign banking institutions and foreign securities
depositories have been approved by the Board of New York Venture Fund, Inc. for
use as sub-custodians for the Fund's securities and other assets:
(Insert banks and securities depositories)
Certified:
---------------------
Fund's Authorized Officer
Date:
----------------
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