EXHIBIT 13 (d) (i)
June 10, 1992
The Depository Trust Company
55 Water Street
New York, New York 10041
Attention: General Counsel's Office
Re: Van Kampen Merritt Trust For Investment Grade
New York Municipals Auction Preferred Shares
of Beneficial Interest ("APS")
Ladies and Gentlemen:
The purpose of this letter is to set forth certain matters
relating to the issuance and sale by Van Kampen Merritt Trust For Investment
Grade New York Municipals (the "Fund") of 1,200 of its preferred shares of
beneficial interest, par value $.01 per share, liquidation preference $50,000
per share, designated as Auction Preferred Shares (the "APS"), pursuant to the
Fund's Declaration of Trust (as defined below). Pursuant to the auction agency
agreement, dated as of June 10, 1992 (the "Auction Agency Agreement"), between
the Fund and Bankers Trust Company ("Bankers Trust"), Bankers Trust will act as
the auction agent, transfer agent, registrar and dividend and redemption price
disbursing agent and agent for certain notifications for the Fund in connection
with the shares of each series of APS (hereinafter referred to, when acting in
an such capacity, as the "Auction Agent").
Pursuant to an underwriting agreement, dated June 5, 1992
("the Underwriting Agreement"), among Goldman, Sachs & Co., Smith Barney, Harris
Upham & Co. Incorporated, Prudential Securities Incorporated, A.G. Edwards &
Sons, Inc., Oppenheimer & Co., Inc. and BT Securities Corporation (the
"Underwriters"), the Fund and Van Kampen Merritt Investment Advisory Corp. (the
"Adviser"), the Underwriters
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June 10, 1992
Page 2
have agreed to purchase from the Fund, and the Fund has agreed to issue and sell
to the Underwriters, the APS. Pursuant to the requirements of the Securities Act
of 1933, as amended, the Fund has filed with the Securities and Exchange
Commission a Registration Statement on Form N-2 and a prospectus contained
therein (the "Prospectus") concerning the issuance of the APS, which includes,
among other things, a description of the role of The Depository Trust Company
("DTC") with respect to such APS. Attached hereto is a copy of the Prospectus.
Capitalized terms not otherwise defined herein shall have the
respective meanings set fort in the Declaration of Trust (as defined below), a
copy of which is attached hereto, unless the context otherwise requires.
To induce DTC to accept the APS as eligible for deposit at DTC
and to act in accordance with its rules with respect to the APS, the Fund and
the Auction Agent agree with DTC as follows:
1. The Fund shall cause the Underwriters to deliver at the
closing with respect to the Underwriting Agreement, which is scheduled
or June 10, 1992, for deposit with DTC one share certificate with
respect to the APS (an "APS Certificate"), which certificate will
represent the total number of APS issued and registered in the name of
DTC's nominee, Cede & Co. ("Cede"), and each such APS Certificate shall
remain in DTC's custody as provided herein.
2. The Fund's Declaration of Trust, as amended, including the
Certificate of Vote (sometimes referred to herein together with the
Fund's Declaration of Trust as the "Declaration of Trust") establishing
the rights and preferences of the APS, provides for the solicitation of
consents from and voting by Holders of the APS under certain
circumstances. The Fund shall establish a record date for such purposes
and give DTC notice of such record date not less than 15 calendar days
in advance of such record date to the extent possible.
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June 10, 1992
Page 3
3. If fewer than all of the APS are to be redeemed pursuant to
Part I, Section 3 of the Certificate of Vote, the number of APS to be
redeemed shall be determined by the Board of Trustees of the Fund and
the Fund shall notify the Auction Agent and DTC by 1:00 p.m., New York
City time, (A) in the case of an optional redemption at least 30 days
prior to the earliest date on which such redemption shall occur and (B)
in the case of a mandatory redemption, if the Fund shall have received
the relief from the Securities and Exchange Commission described in the
Prospectus with respect to mandatory redemptions, on the second
Business Day preceding the redemption date established by the Board of
Trustees and specified in such notice. By the close of business on the
day on which the Auction Agent receives a Notice of Redemption from the
Fund, the Auction Agent will give telephonic notice to DTC, and the
Auction Agent shall give DTC a hand delivered copy of such notice which
will be marked "TIME CRITICAL" and shall include a copy addressed to
Vice President, Reorganization Department (which call notice shall
include the aggregate number of APS to be redeemed). Unless
certificates representing the APS are held by Holders other than DTC or
its nominee, DTC, upon receipt of a Notice of Redemption from the
Auction Agent, will determine by lot the number of APS to be redeemed
from the account of each DTC Participant ("Participant"). DTC shall use
its best efforts to complete such lottery and notify the Auction Agent
of the results of such lottery by 10:00 a.m., New York City time, on
the Business Day following the date on which DTC receives the call
notice from the Auction Agent. DTC shall notify the Auction Agent by
such time of each Participant that has credited to its DTC account APS
that are selected for redemption by DTC and shall, using its best
efforts, provide the Auction Agent with the names of the persons or
departments at each such Participant t be contacted regarding such
redemption. The Auction Agent will in turn determine by lot the number
of APS to be redeemed from the accounts o the Existing Holders of APS
whose Participants have been
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June 10, 1992
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selected in sufficient time to enable the Auction Agent to notify the
Broker-Dealer and such Existing Holders as provided in the Auction
Agency Agreement.
4. The Declaration of Trust provides that the dividend rate
for the APS may vary from time to time based upon the results of the
implementation of the Auction Procedures set forth in Part II of the
Certificate of Vote. The Auction Agent shall telecopy notice to
Manager, Announcements, Dividends Department, The Depository Trust
Company, at (212) 709-1264, of the Applicable Rate and the Dividend
Payment Date with respect to the APS (the "Dividend Rate Notices") no
later than the day following each Auction after implementation of such
procedures and shall verify receipt by DTC of such notice by contacting
the Supervisor, Announcements, Dividends Department, The Depository
Trust Company, at (212) 709-1270. The Auction Agent shall make
available, by telecopy, facsimile or other similar means, to
Interactive Data Services, Inc., or any other announcement service to
which DTC may subscribe, the Applicable Rate and the Dividend Payment
Date on each Auction Date after implementation of such procedures.
5. The Prospectus indicates that each purchaser of APS or its
Broker-Dealer must sign a Master Purchaser's Letter which contains
provisions restricting transfer of such APS. The Fund and the Auction
Agent acknowledge that so long as Cede is the sole record owner of any
of the APS, it shall be entitled to all voting rights applicable to
such APS and to receive the full amount of all dividends, liquidation
proceeds and redemption proceeds payable with respect to such APS. The
Fund and the Auction Agent acknowledge that DTC shall treat any
Participant having any APS credited to its DTC account as entitled to
to the full benefits of ownership of such APS even if the crediting of
such APS to the DTC accounts of such Participant results from transfers
or failures to transfer in violation of the provisions of the Master
Purchaser's Letter. Without limiting the
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June 10, 1992
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generality of the preceding sentence, the Fund and the Auction Agent
acknowledge that DTC shall treat any Participant having any APS
credited to its DTC account as entitled to receive dividends,
distributions and voting rights, if any, in respect of such APS and,
subject to Section 11 hereof, to receive certificates evidencing such
APS if such certificates are to be issued in accordance with the Fund's
Declaration of Trust. (The treatment by DTC of the effects of the
crediting by it of such APS to the accounts of Participants described
in the preceding two sentences shall not affect the rights of the Fund,
participants in Auctions relating to such APS or purchasers, sellers or
Holders of such APS against any Participant.) DTC shall have no
responsibility to ascertain that any transfer of APS is made in
accordance with the provisions of the Master Purchaser's Letter.
6. All notices and payment advices sent to DTC shall contain
the CUSIP number set forth in the respective APS Certificate.
7. Notices to DTC by facsimile transmission shall be sent to
(212) 709-1093 or (212) 709-1094. Notices to DTC by any other means
shall be sent to:
Manager, Reorganization Department
Reorganization Window
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, New York 10004
8. Dividend payments shall be received by Cede, as nominee of
DTC, or its registered assigns in same-day funds on each payment date
(or the equivalent in accordance with existing arrangements between the
Fund or the Auction Agent and DTC). Such payments shall be made payable
to the order of "Cede & Co." Absent any other existing arrangements
such payments shall be addressed as follows:
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June 10, 1992
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Manager, Cash Receipts, Dividends
The Depository Trust Company
7 Hanover Square, 24th Floor
New York, New York 10004
9. Redemption payments shall be made in same-day funds by the
Auction Agent in the manner set forth in the SDFS Paying Agent
Operating Procedures (a copy of which previously has been furnished to
the Auction Agent).
10. DTC may direct the Auction Agent to use any other
telephone number for facsimile transmission, address or department of
DTC as the number, address or department to which payments of
dividends, redemption proceeds or notices may be sent.
11. In the event of a partial redemption necessitating a
reduction in the number of outstanding APS, DTC, in its discretion, (a)
may request the Fund to direct the Auction Agent to issue and
authenticate a new APS Certificate with respect to the APS in exchange
for surrender of the old APS Certificate with respect to such APS or
(b) shall make an appropriate notation on the APS Certificate with
respect to such APS indicating the date and amounts of such reduction
in the outstanding APS, except in the case of a final redemption of APS
in which case the APS Certificate with respect to such APS must be
surrendered to the Auction Agent prior to payment.
12. In the event that beneficial owners of any APS shall be
able to obtain certified shares, the Auction Agent may notify DTC of
the availability of certificates representing the ownership of such
APS. In such event, the Auction Agent will issue, transfer and exchange
APS Certificates with respect to such APS as required by DTC and others
in appropriate amounts.
13. Whenever DTC requests the Fund and the Auction Agent to do
so, the Auction Agent and the Fund will cooperate with DTC in taking
appropriate action to make available one or more separate
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June 10, 1992
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certificates evidencing any APS to any Participant having such APS
credited to its DTC account.
14. DTC may determine to discontinue providing its services as
securities depository with respect to the APS at any time by giving 90
days written notice to the Fund and the Auction Agent (at which time
DTC will confirm with the Auction Agent the aggregate amount of
outstanding APS). Under such circumstances, at DTC's request the Fund
or the Auction Agent will cooperate with DTC in taking appropriate
action to make available one or more separate certificates evidencing
such APS to any Participant having such APS credited to its DTC
account.
15. The Fund hereby authorizes DTC to provide to the Auction
Agent position listings of its Participants with respect to the APS
from time to time at the request of the Auction Agent and upon DTC's
receipt of its customary fee, and also authorizes DTC in the event of a
partial redemption of any of the APS to provide the Auction Agent, upon
request, with the names of those Participants whose position in such
APS has been selected for redemption by DTC. DTC agrees to use its best
efforts to notify the Auction Agent of those Participants whose
position in such APS has been selected for redemption by DTC and to
provide the Auction Agent with the names of the person or department at
such Participants to contact regarding such redemption. The Fund
authorizes the Auction Agent to provide DTC with such signatures,
examples of signatures and authorizations to act as may be deemed
necessary to DTC to permit DTC to discharge its obligations to its
Participants and appropriate regulatory authorities.
This authorization, unless revoked by the Fund, shall continue
with respect the APS while such APS are on deposit at DTC, until and unless the
Auction Agent shall no longer be acting. In such event, the Fund shall provide
DTC with similar evidence of authorization of any successor
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June 10, 1992
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thereto to so act. Such requests for securities positions shall be addressed as
follows:
Supervisory; Proxy
Reorganization Department
The Depository Trust Company
7 Hanover Square; 23rd Floor
New York, NY 10004-2695
Phone (212) 789-6870
Fax (212) 709-6896
16. (a) The Prospectus indicates that the Fund may at any time
designate a Special Dividend Period with respect to any of the APS
prior to the commencement of such Special Dividend Period. In the event
of such designation, the Fund will notify DTC in writing at least seven
days prior to the Auction Date relating to such Special Dividend Period
of all details concerning the Special Dividend Period. If the new
dividend for a Special Dividend Period is to be payable on more than
one Dividend Payment Date, such notice shall state all such Dividend
Payment Dates and payment factors associated with such Dividend Period.
The Auction Agent shall also notify DTC of each upcoming Dividend
Payment Date on the business day after the preceding Dividend Payment
Date.
(b) The Fund will notify DTC, at least 10 business days
prior to the payment date for an Additional Dividend (as defined in the
Prospectus) in respect of any APS, of (i) the record date for Holders
of such APS entitled to receive Additional Dividends, (ii) the amount
of Additional Dividends payable on a per share basis to such Holders
and (ii) the CUSIP number set forth on the share certificate
representing such APS.
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June 10, 1992
Page 9
If you are in agreement with the terms of this Letter
Agreement, please execute the Letter Agreement in the space provided below.
Very truly yours,
VAN KAMPEN MERRITT
TRUST FOR INVESTMENT GRADE
NEW YORK MUNICIPALS
By: /s/ Dennis J. McDonnell
-----------------------
Name: Dennis J. McDonnell
Title: President
BANKERS TRUST COMPANY
as auction agent
By: /s/ Sandra Becker
-----------------
Name: Sandra Becker
Title: Assistant Treasurer
Accepted as of the date
first written above.
THE DEPOSITORY TRUST COMPANY
By: /s/ Richard B. Nesson
---------------------
Name:
Title: General Counsel
(enclosures)
cc: Goldman, Sachs & Co.
Smith Barney, Harris Upham & Co.
Incorporated
Prudential Securities Incorporated
A.G. Edwards & Sons, Inc.
Oppenheimer & Co., Inc.
BT Securities Corporation