AMENDMENT TO THE CUSTODIAN CONTRACT
AGREEMENT made by and between State Street Bank and Trust Company
(the "Custodian") and Alliance Limited Maturity Government Fund,
Inc. (formerly Alliance Mortgage Strategy Trust, Inc.) (the
"Fund").
WHEREAS, the Custodian and the Fund are parties to a custodian
contract dated April 29, 1992 as amended September 14, 1993 (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 Depositories.
Except as may otherwise be agreed upon in writing
by the Custodian and the Fund, assets of the Funds
shall be maintained in foreign securities
depositories 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 4 hereof.
4. 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 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.
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5. 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.
6. 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.
7. Transactions in Foreign Custody Account.
(a) Except as otherwise provided in paragraph (b)
of this Section 7, 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.
8. 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.
9. 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 12 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 9, 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
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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.
10. 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.
11. 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).
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12. 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.
(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.
13. Tax Law.
The Custodian shall have no responsibility or
liability for any obligations now or hereafter
imposed on the Fund or the Custodian as custodian
of the Fund by the tax law of the United States of
America or any state or political subdivision
thereof. It shall be the responsibility of the
Fund to notify the Custodian of the obligations
imposed on the Fund or the Custodian as custodian
of the Fund by the tax law of jurisdictions other
than those mentioned in the above sentence,
including responsibility for withholding and other
taxes, assessments or other governmental charges,
certifications and governmental reporting. The
sole responsibility of the Custodian with regard to
such tax law shall be to use reasonable efforts to
assist the Fund with respect to any claim for
exemption or refund under the tax law of
jurisdictions for which the Fund has provided such
information.
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
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representative and its seal to be hereunder affixed as of the
4th day of June, 1996.
ATTEST ALLIANCE LIMITED MATURITY GOVERNMENT
FUND, INC.
/s/ Xxxxxx X. Xxxxxxx /s/ Xxxxxx X. Xxxxxx, Xx.
_____________________ By:____________________________
Secretary
ATTEST STATE STREET BANK AND TRUST COMPANY
/s/ Xxxxxxxx Xxxxx /s/ Xxxxxx X. Xxxxx
_____________________ By:____________________________
Executive Vice President
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00250110.AY3
