Document:

EXHIBIT 9

                                CUSTODY AGREEMENT

           AGREEMENT, dated as of April 23, 2001, between PROGRESSIVE RETURN
FUND, INC., a corporation organized and existing under the laws of the State of
Maryland, (the "Company") and CUSTODIAL TRUST COMPANY, a bank organized and
existing under the laws of the State of New Jersey (the "Custodian").

           WHEREAS, the Company desires to retain and employ Custodian to act,
and Custodian is willing to act, as Securities Intermediary and custodian for
certain of its securities, funds and other assets pursuant to this Agreement;

           WHEREAS, capitalized terms used herein but not otherwise defined
herein that are defined in the New York Uniform Commercial Code as in effect
from time to time (the "NYUCC") shall have the meanings given such terms in the
NYUCC;

           WHEREAS, the Company is a closed-end, diversified management
investment company registered under the 1940 Act;

           WHEREAS, Custodian represents that it is a bank having the
qualifications prescribed in the 1940 Act to act as custodian for management
investment companies registered under the 1940 Act;

           NOW, THEREFORE, in consideration of the mutual agreements herein
made, the Company and Custodian hereby agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

           Whenever used in this Agreement, the following terms, unless the
context otherwise requires, shall mean:

           1.1 "AUTHORIZED PERSON" means any person authorized by resolution of
the Board of Directors to give Oral Instructions and Written Instructions on
behalf of the Company and identified, by name or by office, in Exhibit A hereto.

           1.2 "BOARD OF DIRECTORS" means the Board of Directors of the Company
or, when permitted under the 1940 Act, the Executive Committee thereof, if any.

           1.3 "BOOK-ENTRY SYSTEM" means a book-entry system maintained by a
Federal Reserve Bank for securities of the United States government or of
agencies or instrumentalities thereof (including government-sponsored
enterprises).

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           1.4 "BUSINESS DAY" means any day on which banks in the State of New
Jersey and New York are open for business.

           1.5 "CUSTODY ACCOUNT" means the account in the name of the Company,
which is provided for in Section 3.2 below.

           1.6 "DOMESTIC SECURITIES DEPOSITORY" means The Depository Trust &
Clearing Corporation and any other clearing agency registered with the
Securities and Exchange Commission under the Securities Exchange Act of 1934,
which acts as a securities depository.

           1.7 "ELIGIBLE DOMESTIC BANK" means a bank as defined in the 1940 Act.

           1.8 "ELIGIBLE FOREIGN CUSTODIAN" has the same meaning as in Rule
17f-5 under the 1940 Act.

           1.9 "ELIGIBLE SECURITIES DEPOSITORY" has the same meaning as in Rule
17f-7 under the 1940 Act.

           1.10 "FOREIGN ASSETS" has the same meaning as in Rule 17f-5 under the
1940 Act.

           1.11 "FOREIGN CUSTODY MANAGER" has the same meaning as in Rule 17f-5
under the 1940 Act.

           1.12 "MASTER REPURCHASE AGREEMENT" means the Master Repurchase
Agreement of even date herewith between the Company and Bear, Stearns & Co. Inc.
("Bear Stearns") as it may from time to time be amended.

           1.13 "MASTER SECURITIES LOAN AGREEMENT" means the Master Securities
Loan Agreement of even date herewith between the Company and Bear, Stearns
Securities Corp. ("BS Securities") as it may from time to time be amended.

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           1.14 "1940 ACT" means the Investment Company Act of 1940, as amended,
and the rules and regulations thereunder.

           1.15 "ORAL INSTRUCTIONS" means instructions orally transmitted to and
accepted by Custodian which are (A) reasonably believed by Custodian to have
been given by an Authorized Person, (B) recorded and kept among the records of
Custodian made in the ordinary course of business, and (C) completed in
accordance with Custodian's requirements from time to time as to content of
instructions and their manner and timeliness of delivery by the Company.

           1.16 "PROPER INSTRUCTIONS" means Oral Instructions or Written
Instructions. Proper Instructions may be continuing Written Instructions when
deemed appropriate by the Company and Custodian.

           1.17 "SECURITIES DEPOSITORY" means any Domestic Securities Depository
or Eligible Securities Depository.

           1.18 "SHARES" means those shares of the capital stock of Company that
represent interests in the Company.

           1.19 "WRITTEN INSTRUCTIONS" means written communications received by
Custodian that are (A) reasonably believed by Custodian to have been signed or
sent by an Authorized Person, (B) sent or transmitted by letter, facsimile,
central processing unit connection, on-line terminal or magnetic tape, and (C)
completed in accordance with Custodian's requirements from time to time as to
content of instructions and their manner and timeliness of delivery by the
Company.

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                                   ARTICLE II
                            APPOINTMENT OF CUSTODIAN

           2.1 APPOINTMENT. The Company hereby appoints Custodian as Securities
Intermediary and custodian of all such securities, funds and other assets of the
Company as may be acceptable to Custodian and from time to time delivered to it
by Custodian or others for the account of the Company.

           2.2 ACCEPTANCE. Custodian hereby accepts appointment as such
Custodian and agrees to perform the duties thereof as hereinafter set forth.

                                   ARTICLE III
                  CUSTODY OF SECURITIES, CASH, AND OTHER ASSETS

           3.1 SEGREGATION. All securities and non-cash property of the Company
in the possession of Custodian (other than securities maintained by Custodian
with a foreign sub-custodian appointed pursuant to this Agreement or in a
Securities Depository or Book-Entry System) shall be physically segregated from
other such securities and non-cash property in the possession of Custodian. All
cash, securities and other non-cash property of the Company shall be identified
as subject to this Agreement.

           3.2 CUSTODY ACCOUNT. (a) Custodian shall open and maintain in its
trust department a custody account in the name of the Company, subject only to
draft or order of Custodian, in which Custodian shall enter and carry all
securities, funds and other assets of the Company which are delivered to
Custodian and accepted by it.

           (b) If Custodian at any time fails to receive any of the documents
referred to in Section 3.10(a) below, then, until such time as it receives such
document, it shall not be obligated to receive any securities of the Company
into the Custody Account and shall be entitled to return to the Company any
securities of the Company that it is holding in the Custody Account.

           (c) The Custody Account is an account to which Financial Assets are
or may be credited, and all assets credited to the Account shall be deemed to be
Financial Assets under Article 8 of the NYUCC. Securities Intermediary shall
indicate by book entry that such Financial Assets have been credited to the
Custody Account.

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           3.3 SECURITIES IN PHYSICAL FORM. Custodian may, but shall not be
obligated to, hold securities that may be held only in physical form.

           3.4 DISCLOSURE TO ISSUERS OF SECURITIES. Custodian is authorized to
disclose the Company's name, address and securities positions in the Custody
Account to the issuers of such securities when requested by them to do so.

           3.5 EMPLOYMENT OF DOMESTIC SUB-CUSTODIANS. At any time and from time
to time, Custodian in its discretion may appoint and employ any Eligible
Domestic Bank as sub-custodian to hold securities and other assets of the
Company that are maintained in the United States and to carry out such other
provisions of this Agreement as it may determine, provided, however, that the
employment of any such sub-custodian has been approved by the Company. The
employment of any such sub-custodian shall be at Custodian's expense and shall
not relieve Custodian of any of its obligations or liabilities under this
Agreement.

           3.6 EMPLOYMENT OF FOREIGN CUSTODIANS. (a) (i) By providing Proper
Instructions to open an account in a given jurisdiction outside the United
States, the Company shall be deemed to have confirmed to Custodian that the
Company has (A) assessed and accepted all material country or sovereign risks in
such jurisdiction and accepted responsibility for their occurrence, (B) made all
determinations required to be made by the Company under the 1940 Act, and (C)
appropriately and adequately disclosed to its shareholders, other investors and
all persons who have right in or to such investments, all material investment
risks, including those relating to the custody and settlement infrastructure or
the servicing of securities in such jurisdiction. Proper Instructions to open an
account in a given country shall comprise authorization of Custodian to hold
assets in such country in accordance with the terms of this Agreement. Custodian
shall not be required to make independent inquiry as to the authorization of the
Company to invest in such country.

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           (ii) Unless instructed otherwise by the Company, Custodian at any
time and from time to time in its discretion may appoint and employ in
accordance with the 1940 Act, and may also cease to employ, (A) any overseas
branch of any Eligible Domestic Bank, or (B) any Eligible Foreign Custodian
selected by the Foreign Custody Manager, in each case as a foreign sub-custodian
for securities and other assets of the Company that are maintained outside the
United States, provided, however, that the employment of any such overseas
branch has been approved by the Company and, provided further that, in the case
of any such Eligible Foreign Custodian, the Foreign Custody Manager has
approved, in writing, the agreement pursuant to which custodian employs such
Eligible Foreign Custodian.

           (iii) Unless instructed otherwise by the Company, Custodian may
deposit and/or maintain Foreign Assets of the Company in any Eligible Securities
Depository. Prior to the time that securities are placed with such Eligible
Securities Depository, but subject to the provisions of Section 3.6(a)(iv)
below, Custodian shall have prepared an assessment of the custody risks
associated with maintaining assets with the Eligible Securities Depository.

           (iv) Prior to placing any assets of the Company with an Eligible
Securities Depository, Custodian shall provide to the Company an assessment of
the custody risks associated with maintaining assets within such Eligible
Securities Depository, provided, however, that if such Foreign Assets are to be
placed or maintained with such Eligible Securities Depository prior to July 1,
2001 (which is the effective date of Rule 17f-7 under the 1940 Act, that
requires the delivery of such an assessment) and Custodian does not then have
such assessment available, custodian may provide such assessment to the Company
on July 1, 2001, or promptly thereafter. Custodian shall monitor such custody
risks on a continuing basis and promptly notify the Company of any material
change in such risks. In performing its duties under this Section 3.6(a)(iv),
Custodian shall use reasonable care, prudence and diligence and, in the exercise
of such care, prudence and diligence, may rely upon examinations performed and
determinations made by Citibank, N.A. or such other operator of a global custody
system as the Company may from time to time approve.

           (b) Set forth on Exhibit C hereto are the foreign sub-custodians that
Custodian may employ pursuant to Section 3.6(a) above. Exhibit C shall be
revised from time to time as foreign sub-custodians and countries are added or
deleted.

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           (c) If the Company proposes to make an investment which is to be held
in a country in which Custodian does not have appropriate arrangements in place
with a foreign sub-custodian selected in accordance with section 3.6(a)(ii)
above, then the Company shall inform Custodian sufficiently in advance of such
investment to allow Custodian to make such arrangements.

           (d) Notwithstanding anything to the contrary in Section 8.1 below or
elsewhere in this Agreement, Custodian shall have no greater liability to the
Company for the actions or omissions of any foreign sub-custodian appointed
pursuant to this Agreement than any such foreign sub-custodian has to Custodian,
and Custodian shall not be required to discharge any such liability which may be
imposed on it unless and until such foreign sub-custodian has effectively
indemnified Custodian against it or has otherwise discharged its liability to
Custodian in full.

           (e) Upon the request of the Foreign Custody Manager, Custodian shall
annually furnish to the Foreign Custody Manager information concerning all
foreign sub-custodians appointed pursuant to this Agreement which shall be
similar in kind and scope to that furnished to the Foreign Custody Manager in
connection with the initial approval by the Foreign Custody Manager of the
agreements

pursuant to which Custodian employs such foreign sub-custodians or as otherwise
required by the 1940 Act.

           3.7 APPOINTMENT OF OTHER AGENTS. Custodian may employ other suitable
agents, which may include affiliates of Custodian such as Bear Stearns or BS
Securities, both of which are securities broker-dealers, provided, however, that
Custodian shall not employ either of such affiliates to hold any collateral
pledged to the Company, or purchased by the Company, under any securities loan
agreement or repurchase agreement (whether now or hereafter in effect) between
the Company and such affiliate. The appointment of any agent pursuant to this
Section 3.7 shall not relieve Custodian of any of its obligations or liabilities
under this Agreement.

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           3.8 BANK ACCOUNTS. In its discretion and from time to time Custodian
may open and maintain one or more demand deposit accounts with any Eligible
Domestic Bank (any such accounts to be in the name of Custodian and subject only
to its draft or order), provided, however, that the opening and maintenance of
any such account shall be at Custodian's expense and shall not relieve Custodian
of any of its obligations or liabilities under this Agreement.

            3.9 DELIVERY OF ASSETS TO CUSTODIAN. Provided they are acceptable to
Custodian, the Company shall deliver to Custodian its securities, funds and
other assets, including (A) payments of income, payments of principal and
capital distributions received by the Company with respect to its securities,
funds or other assets at any time during the term of this Agreement, and (B)
funds received by the Company for the issuance, at any time during such term, of
its Shares. Custodian shall not be under any duty or obligation to require the
Company to deliver to it any of its securities or other assets and shall have no
responsibility or liability for or on account of securities or other assets not
so delivered.

           3.10 DOMESTIC SECURITIES DEPOSITORIES AND BOOK-ENTRY SYSTEMS.
Custodian may deposit and/or maintain securities of the Company in a Domestic
Securities Depository or in a Book-Entry System, subject to the following
provisions:

           (a) Prior to a deposit of securities of the Company in any Domestic
Securities Depository or Book-Entry System, the Company shall deliver to
Custodian a resolution of the Board of Directors of the Company, certified by an
officer of the Company, authorizing and instructing Custodian (and any
sub-custodian employed by it) on an on-going basis to deposit in such Domestic
Securities Depository or Book-Entry System all securities eligible for deposit
therein and to make use of such Domestic Securities Depository or Book-Entry
System to the extent possible and practical in connection with the performance
of its obligations under custody or sub-custody agreements for securities
belonging to the Company, including, without limitation, in connection with
loans of securities and deliveries and returns of collateral consisting of
securities.

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           (b) Securities of the Company kept in a Book-Entry System or Domestic
Securities Depository shall be kept in an account ("Depository Account") of
Custodian in such Book-Entry System or Domestic Securities Depository which
includes only assets held by Custodian as Securities Intermediary, custodian,
fiduciary or otherwise for customers.

           (c) The records of Custodian with respect to securities of the
Company maintained in a Book-Entry System or Domestic Securities Depository
shall at all times identify such securities as belonging to the Company.

           (d) If securities purchased by the Company are to be held in a
Book-Entry System or Domestic Securities Depository, Custodian (or any
sub-custodian appointed pursuant to Section 3.5 above) shall pay for such
securities upon (I) receipt of advice from the Book-Entry System or Domestic
Securities Depository that such securities have been transferred to the
Depository Account, and (II) the making of an entry on the records of Custodian
(or of such sub-custodian) to reflect such payment and transfer for the account
of the Company. If securities sold by the Company are held in a Book-Entry
System or Domestic Securities Depository, Custodian (or such sub-custodian)
shall transfer such securities upon (A) receipt of advice from the Book-Entry
System or Domestic Securities Depository that payment for such securities has
been transferred to the Depository Account, and (B) the making of an entry on
the records of Custodian (or of such sub-custodian) to reflect such transfer and
payment for the account of the Company.

           (e) Custodian shall provide the Company with copies of any report
obtained by Custodian from a Book-Entry System or Domestic Securities Depository
in which securities of the Company are kept on the internal accounting controls
and procedures for safeguarding securities deposited in such Book-Entry System
or Domestic Securities Depository.

           (f) At its election, the Company shall be subrogated to the rights of
Custodian with respect to any claim against a Book-Entry System or Domestic
Securities Depository or any other person for any loss or damage to the Company
arising from the use of such Book-Entry System or Domestic Securities
Depository, if and to the extent that the Company has not been made whole for
any such loss or damage.

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           3.11 FOREIGN SECURITIES DEPOSITORIES. Custodian or any foreign
sub-custodian appointed pursuant to Section 3.6 above may maintain securities of
the Company in any Eligible Securities Depository set forth on Exhibit C hereto.
Exhibit C shall be revised from time to time as Foreign Securities Depositories
are added or deleted.

           3.12 RELATIONSHIP WITH SECURITIES DEPOSITORIES. No Book-Entry System,
Securities Depository, or other securities depository or clearing agency
(whether foreign or domestic) which it is or may become standard market practice
to use for the comparison and settlement of trades in securities shall be an
agent or sub-contractor of Custodian for purposes of Section 3.7 above or
otherwise.

           3.13 PAYMENTS FROM CUSTODY ACCOUNT. Upon receipt of Proper
Instructions but subject to its right to foreclose upon and liquidate collateral
pledged to it pursuant to Section 9.3 below, Custodian shall make payments from
the Custody Account, but only in the following cases, provided, FIRST, that such
payments are in connection with the clearance and/or custody of securities or
other assets, SECOND, that there are sufficient funds in such Custody Account,
whether belonging to the Company or advanced to it by Custodian in its sole and
absolute discretion as set forth in Section 3.18 below, for Custodian to make
such payments, and, THIRD, that after the making of such payments, the Company
would not be in violation of any margin or other requirements agreed upon
pursuant to Section 3.18 below:

           (a) For the purchase of securities for the Company but only (I) in
the case of securities (other than options on securities, futures contracts and
options on futures contracts), against the delivery to Custodian (or any
sub-custodian appointed pursuant to this Agreement) of such securities
registered as provided in Section 3.20 below or in proper form for transfer or,
if the purchase of such securities is effected through a Book-Entry System or
Domestic Securities Depository, in accordance with the conditions set forth in
Section 3.10 above, and (II) in the case of options, futures contracts and
options on futures contracts, against delivery to Custodian (or such
sub-custodian) of evidence of title thereto in favor of the Company, the
Custodian, any such sub-custodian, or any nominee referred to in Section 3.20
below;

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           b) In connection with the conversion, exchange or surrender, as set
forth in Section 3.14(f) below, of securities owned by the Company;

           (c) For transfer in accordance with the provisions of any agreement
among the Company, Custodian and a securities broker-dealer, relating to
compliance with rules of The Options Clearing Corporation and of any registered
national securities exchange (or of any similar organization or organizations)
regarding escrow or other arrangements in connection with transactions of the
Company;

           (d) For transfer in accordance with the provisions of any agreement
among the Company, Custodian and a futures commission merchant, relating to
compliance with the rules of the Commodity Futures Trading Commission and/or any
contract market (or any similar organization or organizations) regarding margin
or other deposits in connection with transactions of the Company;

           (e) For the funding of any time deposit (whether certificated or not)
or other interest-bearing account with any banking institution (including
Custodian), provided that Custodian shall receive

           and retain such certificate, advice, receipt or other evidence of
deposit (if any) as such banking institution may deliver with respect to any
such deposit or account;

           f) For the purchase from a banking or other financial institution of
loan participations, but only if Custodian has in its possession a copy of the
agreement between the Company and such banking or other financial institution
with respect to the purchase of such loan participations and provided that
Custodian shall receive and retain such participation certificate or other
evidence of participation (if any) as such banking or other financial
institution may deliver with respect to any such loan participation;

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           (g) For the purchase and/or sale of foreign currencies or of options
to purchase and/or sell foreign currencies, for spot or future delivery, for the
account of the Company pursuant to contracts between the Company and any banking
or other financial institution (including Custodian, any sub-custodian appointed
pursuant to this Agreement and any affiliate of Custodian);

           (h) For transfer to a securities broker-dealer as margin for a short
sale of securities for the Company, or as payment in lieu of dividends paid on
securities sold short for the Company;

           (i) For the payment as provided in Article IV below of any dividends,
capital gain distributions or other distributions declared on the Shares of the
Company;

           (j) For the payment as provided in Article IV below of the redemption
price of the Shares of the Company;

           (k) For the payment of any expense or liability incurred by the
Company, including but not limited to the following payments for the account of
the Company: interest, taxes, and administration, investment advisory,
accounting, auditing, transfer agent, custodian, trustee and legal fees, and
other operating expenses of the Company; in all cases, whether or not such
expenses are to be in whole or in part capitalized or treated as deferred
expenses; and

           (l) For any other proper purpose, but only upon receipt of Proper
Instructions, specifying the amount and purpose of such payment, certifying such
purpose to be a proper purpose of the Company, and naming the person or persons
to whom such payment is to be made.

           3.14 DELIVERIES FROM CUSTODY ACCOUNT. Upon receipt of Proper
Instructions but subject to its right to foreclose upon and liquidate collateral
pledged to it pursuant to Section 9.3 below, Custodian shall release and deliver
securities and other assets from the Custody Account, but only in the following
cases, provided, FIRST, that such deliveries are in connection with the
clearance and/or custody of securities or other assets, SECOND, there are
sufficient amounts and types of securities or other assets in the Custody
Account for Custodian to make such deliveries, and, THIRD, that after the making
of such deliveries, the Company would not be in violation of any margin or other
requirements agreed upon pursuant to Section 3.18 below:

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           (a) Upon the sale of securities for the account of the Company but,
subject to Section 3.15 below, only against receipt of payment therefor or, if
such sale is effected through a Book-Entry System or Domestic Securities
Depository, in accordance with the provisions of Section 3.10 above;

           (b) To an offeror's depository agent in connection with tender or
other similar offers for securities of the Company; provided that, in any such
case, the funds or other consideration for such securities is to be delivered to
Custodian;

           (c) To the issuer thereof or its agent when such securities are
called, redeemed or otherwise become payable, provided that in any such case the
funds or other consideration for such securities is to be delivered to
Custodian;

           (d) To the issuer thereof or its agent for exchange for a different
number of certificates or other evidence representing the same aggregate face
amount or number of units; provided that, in any such case, the new securities
are to be delivered to Custodian;

           (e) To the securities broker through whom securities are being sold
for the Company, for examination in accordance with the "street delivery"
custom;

           (f) For exchange or conversion pursuant to any plan of merger,
consolidation, recapitalization, reorganization or readjustment of the issuer of
such securities, or pursuant to provisions for conversion contained in such
securities, or pursuant to any deposit agreement, including surrender or receipt
of underlying securities in connection with the issuance or cancellation of
depository receipts; provided that, in any such case, the new securities and
funds, if any, are to be delivered to Custodian;

           (g) In the case of warrants, rights or similar securities, to the
issuer of such warrants, rights or similar securities, or its agent, upon the
exercise thereof, provided that, in any such case, the new securities and funds,
if any, are to be delivered to Custodian;

           (h) To the borrower thereof, or its agent, in connection with any
loans of securities for the Company pursuant to any securities loan agreement
entered into by the Company, but only against receipt by Custodian of such
collateral as is required under such securities loan agreement;

           (i) To any lender, or its agent, as collateral for any borrowings
from such lender by the Company that require a pledge of assets of the Company,
but only against receipt by Custodian of the amounts borrowed;

           (j) Pursuant to any authorized plan of liquidation, reorganization,
merger, consolidation or recapitalization of the Company;

           (k) For delivery in accordance with the provisions of any agreement
among the Company, Custodian and a securities broker- dealer, relating to
compliance with the rules of The Options Clearing Corporation and of any
registered national securities exchange (or of any similar organization or
organizations) regarding escrow or other arrangements in connection with
transactions of the Company;

           (l) For delivery in accordance with the provisions of any agreement
among the Company, Custodian, and a futures commission merchant, relating to
compliance with the rules of the Commodity Futures Trading Commission and/or any
contract market (or any similar organization or organizations) regarding margin
or other deposits in connection with transactions of the Company;

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           (m) For delivery to a securities broker-dealer as margin for a short
sale of securities for the Company;

           (n) To the issuer of American Depositary Receipts or International
Depositary Receipts (hereinafter, collectively, "ADRs") for such securities, or
its agent, against a written receipt therefor adequately describing such
securities, provided that such securities are delivered together with
instructions to issue ADRs in the name of Custodian or its nominee and to
deliver such ADRs to Custodian;

           (o) In the case of ADRs, to the issuer thereof, or its agent, against
a written receipt therefor adequately describing such ADRs, provided that such
ADRs are delivered together with instructions to deliver the securities
underlying such ADRs to Custodian or an agent of Custodian; or

           (p) For any other proper purpose, but only upon receipt of Proper
Instructions, specifying the securities or other assets to be delivered, setting
forth the purpose for which such delivery is to be made, certifying such purpose
to be a proper purpose of the Company, and naming the person or persons to whom
delivery of such securities or other assets is to be made.

            3.15 DELIVERY PRIOR TO FINAL PAYMENT. When instructed by the Company
to deliver its securities against payment, Custodian shall be entitled, but only
if in accordance with generally accepted market practice, to deliver such
securities prior to actual receipt of final payment therefor and, exclusively in
the case of securities in physical form, prior to receipt of payment therefor.
In any such case, the Company shall bear the risk that final payment for such
securities may not be made or that such securities may be returned or otherwise
held or disposed of by or through the person to whom they were delivered, and
Custodian shall have no liability for any of the foregoing.

           3.16 COLLECTION OF INCOME AND OTHER PAYMENTS.(a) Custodian shall
receive in the Account any money or property, including without limitation any
dividends, payments of principal or other distributions or payments, on account
of securities in the Account. Custodian shall not, however, be required to
enforce collection, by legal means or otherwise, of any such money or other
property not paid when due, but shall receive the proceeds of such collections
as may be effected by it or its agents in the ordinary course of its custody and
safekeeping business.

           (b) Custodian shall not be liable for, or considered to be custodian
of, any cash belonging to Custodian or any money represented by a check, draft
or other instrument for the payment of money, until Custodian or its agents
actually receive such cash or collect on such instrument.

           (c) In its sole discretion and from time to time, Custodian may
credit the Custody Account, prior to actual receipt of final payment thereof,
with (A) proceeds from the sale of securities in the Custody Account which it
has been instructed to deliver against payment, (B) proceeds from the redemption
of securities or other assets in such Custody Account, and (C) income from cash,
securities or other assets in the Custody Account. Any such credit shall be
conditional upon actual receipt by Custodian of final payment and may be
reversed if final payment is not actually received in full. Custodian may, in
its sole discretion and from time to time, permit the Company to use funds so
credited to the Account in anticipation of actual receipt of final payment. Any
such funds so used shall bear interest at such rate as Custodian and the Company
may agree, shall be repayable immediately upon demand made by Custodian at any
time prior to the actual receipt by it of all final payments in anticipation of
which funds were credited to the Account, and shall constitute an advance that
is fully secured as provided in Section 9.3 below.

           (d) For purposes of this Agreement, "final payment" means payment in
funds which are (or have become) immediately available, under applicable law are
irreversible, and are not subject to any security interest, levy, lien or other
encumbrance.

                                      -14-
<PAGE>

           3.17 PAYMENTS AND DELIVERIES OUTSIDE THE UNITED STATES.
Notwithstanding anything to the contrary that may be required by Section 3.13 or
Section 3.14 above, or elsewhere in this Agreement, in the case of securities
and other assets maintained outside the United States and in the case of
payments made outside the United States, Custodian and any sub-custodian
appointed pursuant to this Agreement may receive and deliver such securities or
other assets, and may make such payments, in accordance with the laws,
regulations, customs, procedures and practices applicable in the relevant local
market outside the United States.

           3.18 CLEARING CREDIT. Custodian may, in its sole discretion and from
time to time, advance funds to the Company to facilitate the settlement of
transactions in the Custody Account. Any such advance (A) shall be repayable
immediately upon demand made by Custodian, (B) shall be fully secured as
provided in Section 9.3 below, and (C) shall bear interest at such rate, and be
subject to such other terms and conditions, as Custodian and the Company may
agree.

           3.19 ACTIONS NOT REQUIRING PROPER INSTRUCTIONS. Unless otherwise
instructed by the Company, Custodian shall with respect to all securities and
other assets held for the Company:

           (a) Subject to Section 3.16(a) above, receive into the Custody
Account any funds or other property, including payments of principal, interest
and dividends, due and payable on or on account of such securities and other
assets;

           (b) Deliver securities of the Company to the issuers of such
securities or their agents for the transfer thereof into the name of the
Company, Custodian or any of the nominees referred to in Section 3.20 below;

           (c) Endorse for collection, in the name of the Company, checks,
drafts and other negotiable instruments;

           (d) Surrender interim receipts or securities in temporary form for
securities in definitive form;

           (e) Execute, as custodian, any necessary declarations or certificates
of ownership under the federal income tax laws of the United States, or the laws
or regulations of any other taxing authority, in connection with the transfer of
such securities or other assets or the receipt of income or other payments with
respect thereto;

           (f) Receive and hold for the Company all rights and similar
securities issued with respect to securities or other assets of the Company;

           (g) As may be required in the execution of Proper Instructions,
transfer funds from the Custody Account to any demand deposit account maintained
by Custodian pursuant to Section 3.8 above; and

           (h) In general, attend to all non-discretionary details in connection
with the sale, exchange, substitution, purchase and transfer of, and other
dealings in, such securities and other assets.

           3.20 REGISTRATION AND TRANSFER OF SECURITIES. All securities held for
the Company under this Agreement that are issuable only in bearer form shall be
held by Custodian in that form, provided that any such securities shall be held
in a Securities Depository or Book-Entry System if eligible therefor. All other
securities and all other assets held for the Company may be registered in the
name of (A) Custodian as agent, (B) any Securities Depository, or (C) any
nominee of any of them. The Company shall furnish to Custodian appropriate
instruments to enable Custodian to hold or deliver in proper form for transfer,
or to register as in this Section 3.20 provided, any securities or other assets
delivered to Custodian which are registered in the name of the Company,
Custodian or a nominee of Custodian.

                                      -15-
<PAGE>

           3.21 RECORDS. (A) Custodian shall maintain complete and accurate
records with respect to securities, funds and other assets held for the Company,
including (I) journals or other records of original entry containing an itemized
daily record in detail of all receipts and deliveries of securities and all
receipts and disbursements of funds; (II) ledgers (or other records) reflecting
(A) securities in transfer, if any, (B) securities in physical possession, (C)
monies and securities borrowed and monies and securities loaned (together with a
record of the collateral therefor and substitutions of such collateral), (D)
dividends and interest received, and (E) dividends receivable and interest
accrued; and (III) canceled checks and bank records related thereto. Custodian
shall keep such other books and records with respect to securities, funds and
other assets of the Company which are held hereunder as Custodian may reasonably
request.

           (b) All such books and records maintained by Custodian shall (I) be
maintained in a form acceptable to the Company and in compliance with rules and
regulations of the Securities and Exchange Commission, (II) be the property of
the Company and at all times during the regular business hours of Custodian be
made available upon request for inspection by duly authorized officers,
employees or agents of the Company and employees or agents of the Securities and
Exchange Commission, and (III) if required to be maintained under the 1940 Act,
be preserved for the periods prescribed therein.

           3.22 ACCOUNT REPORTS BY CUSTODIAN. Custodian shall furnish the
Company with a daily activity statement, including a summary of all transfers to
or from the Custody Account. At least monthly and from time to time, Custodian
shall furnish the Company with a detailed statement of the securities, funds and
other assets held under this Agreement.

           3.23 OTHER REPORTS BY CUSTODIAN. Custodian shall provide the Company
with such reports as the Company may reasonably request from time to time on the
internal accounting controls and procedures for safeguarding securities which
are employed by Custodian.

           3.24 PROXIES AND OTHER MATERIALS. (A) Unless otherwise instructed by
the Company, Custodian shall promptly deliver to the Company all notices of
meetings, proxy materials (other than proxies) and other announcements, which it
receives regarding securities held by it in the Custody Account. Whenever
Custodian or any of its agents receives a proxy with respect to securities in
the Custody Account, Custodian shall promptly request instructions from the
Company on how such securities are to be voted, and shall give such proxy, or
cause it to be given, in accordance with such instructions. If the Company
timely informs Custodian that it wishes to vote any such securities in person,
Custodian shall promptly seek to have a legal proxy covering such securities
issued to the Company. Unless otherwise instructed by the Company, neither
Custodian nor any of its agents shall exercise any voting rights with respect to
securities held hereunder.

           (b) Unless otherwise instructed by the Company, Custodian shall
promptly transmit to the Company all other written information received by
Custodian from issuers of securities held in the Custody Account. With respect
to tender or exchange offers for such securities or with respect to other
corporate transactions involving such securities, Custodian shall promptly
transmit to the Company all written information received by Custodian from the
issuers of such securities or from any party (or its agents) making any such
tender or exchange offer or participating in such other corporate transaction.
If the Company, with respect to such tender or exchange offer or other corporate
transaction, desires to take any action that may be taken by it pursuant to the
terms of such offer or other transaction, the Company shall notify Custodian (I)
in the case of securities maintained outside the United States, such number of
Business Days prior to the date on which Custodian is to take such action as
will allow Custodian to take such action in the relevant local market for such
securities in a timely fashion, and (II) in the case of all other securities, at
least five Business Days prior to the date on which Custodian is to take such
action.

           3.25 CO-OPERATION. Custodian shall cooperate with and supply
necessary information to the entity or entities appointed by the Company to keep
the books of account of the Company and/or to compute the value of its assets.

                                      -16-
<PAGE>

                                   ARTICLE IV
                         REDEMPTION OF PORTFOLIO SHARES;
                        DIVIDENDS AND OTHER DISTRIBUTIONS

           4.1 TRANSFER OF FUNDS. From such funds as may be available for the
purpose in the Custody Account, and upon receipt of Proper Instructions
specifying that the funds are required to redeem Shares of the Company or to pay
dividends or other distributions to holders of its Shares, Custodian shall
transfer each amount specified in such Proper Instructions to such account of
the Company or

of an agent thereof (other than Custodian), at such bank, as the Company may
designate therein with respect to such amount.

           4.2 SOLE DUTY OF CUSTODIAN. Custodian's sole obligation with respect
to the redemption of Shares of the Company and the payment of dividends and
other distributions thereon shall be its obligation set forth in Section 4.1
above, and Custodian shall not be required to make any payments to the various
holders from time to time of Shares of the Company nor shall Custodian be
responsible for the payment or distribution by the Company, or any agent
designated in Proper Instructions given pursuant to Section 4.1 above, of any
amount paid by Custodian to the account of the Company or such agent in
accordance with such Proper Instructions.

                                    ARTICLE V
                               SEGREGATED ACCOUNTS

           Upon receipt of Proper Instructions to do so, Custodian shall
establish and maintain a segregated account or accounts for and on behalf of the
Company, into which account or accounts may be transferred funds and/or
securities, including securities maintained in a Securities Depository:

           (a) in accordance with the provisions of any agreement among the
Company, Custodian and a securities broker-dealer (or any futures commission
merchant), relating to compliance with the rules of The Options Clearing
Corporation or of any registered national securities exchange (or the Commodity
Futures Trading Commission or any registered contract market), or of any similar
organization or organizations, regarding escrow or other arrangements in
connection with transactions of the Company,

           (b) for purposes of segregating funds or securities in connection
with securities options purchased or written by the Company or in connection
with financial futures contracts (or options thereon) purchased or sold by the
Company,

           (c) which constitute collateral for loans of securities made by the
Company,

           (d) for purposes of compliance by the Company with requirements under
the 1940 Act for the maintenance of segregated accounts by registered management
investment companies in connection with reverse repurchase agreements,
when-issued, delayed delivery and firm commitment transactions, and short sales
of securities, and

           (e) for other proper purposes, but only upon receipt of Proper
Instructions, specifying the purpose or purposes of such segregated account and
certifying such purposes to be proper purposes of the Company.

                                   ARTICLE VI
                     CERTAIN SECURITIES LENDING TRANSACTIONS

           6.1 TRANSACTIONS. If and to the extent that the necessary funds and
securities have been entrusted to it under this Agreement, and subject to
Custodian's right to foreclose upon and liquidate collateral pledged to it
pursuant to Section 9.3 below, Custodian, as agent of the Company, shall from
time to time (and unless the Company gives it Proper Instructions to do
otherwise) make for the account of the Company the transfers of funds and
deliveries of securities which the Company is required to make pursuant to the
Master Securities Loan Agreement and shall receive for the account of the
Company the transfers of funds and deliveries of securities which the borrower
under the Master Securities Loan Agreement is required to make pursuant thereto.
Custodian shall make and receive all such transfers and deliveries pursuant to,
and subject to the terms and conditions of, the Master Securities Loan
Agreement.

                                      -17-
<PAGE>

           6.2 COLLATERAL. Custodian shall daily mark to market, in the manner
provided for in the Master Securities Loan Agreement, all loans of securities
which may from time to time be outstanding thereunder.

           6.3 DEFAULTS. Custodian shall promptly notify the Company of any
default under the Master Securities Loan Agreement (as such term "default" is
defined therein) of which it has actual knowledge.

           6.4 MASTER SECURITIES LOAN AGREEMENT. Custodian hereby acknowledges
its receipt from the Company of a copy of the Master Securities Loan Agreement.
The Company shall provide Custodian, prior to the effectiveness thereof, with a
copy of any amendment to the Master Securities Loan Agreement.

                                   ARTICLE VII
                         CERTAIN REPURCHASE TRANSACTIONS

           7.1 TRANSACTIONS. If and to the extent that the necessary funds and
securities have been entrusted to it under this Agreement, and subject to
Custodian's right to foreclose upon and liquidate collateral pledged to it
pursuant to Section 9.3 below, Custodian, as agent of the Company, shall from
time to time (and unless the Company gives it Proper Instructions to do
otherwise) make for the account of the Company the transfers of funds and
deliveries of securities which the Company is required to make pursuant to the
Master Repurchase Agreement and shall receive for the account of the Company the
transfers of funds and deliveries of securities which the seller under the
Master Repurchase Agreement is required to make pursuant thereto. Custodian
shall make and receive all such transfers and deliveries pursuant to, and
subject to the terms and conditions of, the Master Repurchase Agreement.

           7.2 COLLATERAL. Custodian shall daily mark to market the securities
purchased under the Master Repurchase Agreement and held in the Custody Account,
and shall give to the seller thereunder any such notice as may be required
thereby in connection with such mark-to-market.

           7.3 EVENTS OF DEFAULT. Custodian shall promptly notify the Company of
any event of default under the Master Repurchase Agreement (as such term "event
of default" is defined therein) of which it has actual knowledge.

           7.4 MASTER REPURCHASE AGREEMENT. Custodian hereby acknowledges its
receipt from the Company of a copy of the Master Repurchase Agreement. The
Company shall provide Custodian, prior to the effectiveness thereof, with a copy
of any amendment to the Master Repurchase Agreement.

                                  ARTICLE VIII
                            CONCERNING THE CUSTODIAN

           8.1 STANDARD OF CARE. Custodian shall be held to the exercise of
reasonable care in carrying out its obligations under this Agreement, and shall
be without liability to the Company for any loss, damage, cost, expense
(including attorneys' fees and disbursements), liability or claim which does not
arise from willful misfeasance, bad faith or negligence on the part of
Custodian. Custodian shall be entitled to rely on and may act upon advice of
counsel in all matters, and shall be without liability for any action reasonably
taken or omitted pursuant to such advice. In no event shall Custodian be liable
for special, incidental or consequential damages, even if Custodian has been
advised of the possibility of such damages, or be liable in any manner
whatsoever for any action taken or omitted upon instructions from the Company or
any agent of the Company.

           8.2 NO RESPONSIBILITY FOR TITLE, ETC. So long as and to the extent
that it is in the exercise of reasonable care, Custodian shall not be
responsible for the title, validity or genuineness of any assets or evidence of
title thereto received or delivered by it or its agents.

                                      -18-
<PAGE>

           8.3 EXPRESS DUTIES ONLY. Custodian shall have no duties or
obligations whatsoever except such duties and obligations as are specifically
set forth in this Agreement, and no covenant or obligation shall be implied in
this Agreement against Custodian. Custodian shall have no discretion whatsoever
with respect to the management, disposition or investment of the Custody Account
and is not a fiduciary to the Company. In particular, Custodian shall not be
under any obligation at any time to monitor or to take any other action with
respect to compliance by the Company with the 1940 Act, the provisions of the
Company's charter documents or by-laws, or the Company's investment objectives,
policies and limitations as in effect from time to time.

                                   ARTICLE IX
                                 INDEMNIFICATION

           9.1 INDEMNIFICATION. The Company shall indemnify and hold harmless
Custodian, any sub-custodian appointed pursuant to this Agreement and any
nominee of any of them, from and against any loss, damages, cost, expense
(including attorneys' fees and disbursements), liability (including, without
limitation, liability arising under the Securities Act of 1933, the Securities
Exchange Act of 1934, the 1940 Act, and any federal, state or foreign securities
and/or banking laws) or claim arising directly or indirectly (A) from the fact
that securities or other assets in the Custody Account are registered in the
name of any such nominee, or (B) from any action or inaction by Custodian or
such sub-custodian or nominee (i) at the request or direction of or in reliance
on the advice of the Company or any of its agents, or (II) upon Proper
Instructions, or (c) generally, from the performance of its obligations under
this Agreement, provided that Custodian, any such sub-custodian or any nominee
of any of them shall not be indemnified and held harmless from and against any
such loss, damage, cost, expense, liability or claim arising from willful
misfeasance, bad faith or negligence on the part of Custodian or any such
sub-custodian or nominee.

           9.2 INDEMNITY TO BE PROVIDED. If the Company requests Custodian to
take any action with respect to securities or other assets of the Company, which
may, in the opinion of Custodian, result in Custodian or its nominee becoming
liable for the payment of money or incurring liability of some other form,
Custodian shall not be required to take such action until the Company shall have
provided indemnity therefor to Custodian in an amount and form satisfactory to
Custodian.

           9.3 SECURITY. As security for the payment of any present or future
obligation or liability of any kind which the Company may have to Custodian with
respect to or in connection with the Custody Account or this Agreement, or which
the Company may otherwise have to Custodian, the Company hereby pledges to
Custodian all securities, funds and other assets of every kind which are in such
Custody Account or otherwise held for the Company pursuant to this Agreement,
and hereby grants to Custodian a lien, right of set-off and continuing security
interest in such securities, funds and other assets.

                                    ARTICLE X
                                  FORCE MAJEURE

           Custodian shall not be liable for any failure or delay in performance
of its obligations under this Agreement arising out of or caused, directly or
indirectly, by circumstances beyond its reasonable control, including, without
limitation, acts of God; earthquakes; fires; floods; wars; civil or military
disturbances; sabotage; strikes; epidemics; riots; power failures; computer
failure and any such circumstances beyond its reasonable control as may cause
interruption, loss or malfunction of utility, transportation, computer (hardware
or software) or telephone communication service; accidents; labor disputes; acts
of civil or military authority; actions by any governmental authority, DE JURE
or DE FACTO; or inability to obtain labor, material, equipment or
transportation.

                                   ARTICLE XI
                         REPRESENTATIONS AND WARRANTIES

           Each of Custodian and the Company represents and warrants for itself
that (a) it has all necessary power and authority to perform its obligations
hereunder, (b) the execution and delivery by it of this Agreement, and the
performance by it of its obligations hereunder, have been duly authorized by all
necessary action, corporate or otherwise, and will not violate any law,
regulation, charter, by-law, or other instrument, restriction or provision
applicable to it or by which it or its assets may be bound, and (c) this
Agreement constitutes a legal, valid and binding obligation of it, enforceable
against it in accordance with its terms.

                                      -19-
<PAGE>

                                   ARTICLE XII
                            COMPENSATION OF CUSTODIAN

           The Company shall pay Custodian such fees and charges as are set
forth in Exhibit B hereto, as such Exhibit B may from time to time be revised by
Custodian upon 14 days' prior written notice to the Company. Any annual fee or
other charges payable by the Company shall be calculated on the basis of the
total market value of the assets in the Custody Account on the last Business Day
of the month for which such fee is charged; and such fee, and any transaction
charges payable by Custodian, shall be paid monthly by automatic deduction from
the Custody Account. Out-of-pocket expenses incurred by Custodian in the
performance of its services hereunder and all other proper charges and
disbursements of the Custody Account, shall be charged to the Custody Account by
Custodian and paid in the same manner as the annual fee and other charges
referred to in this Article XII.

                                  ARTICLE XIII
                                      TAXES

           Any and all taxes, including any interest and penalties with respect
thereto, which may be levied or assessed under present or future laws or in
respect of the Custody Account or any income thereof shall be charged to the
Custody Account by Custodian and paid therefrom.

                                   ARTICLE XIV
                           AUTHORIZED PERSONS; NOTICES

           14.1 AUTHORIZED PERSONS. Custodian may rely upon and act in
accordance with any notice, confirmation, instruction or other communication
which is reasonably believed by Custodian to have been given or signed on behalf
of the Company by one of the Authorized Persons designated in Schedule A hereto
as it may from time to time be revised. The Company may revise Schedule A hereto
at any time by notice in writing to Custodian given in accordance with Section
14.3 below, but no revision of Schedule A hereto shall be effective until
Custodian actually receives such notice.

           14.2 ORAL INSTRUCTIONS. Custodian may accept instructions orally
communicated provided that such oral instructions are reasonably believed by it
to have been given on behalf of Custodian by an Authorized Person. If a written
instruction confirming an oral instruction is not received by Custodian prior to
a transaction, it shall in no way affect the validity of the transaction
authorized by such oral instruction or the authorization of Custodian to effect
such transaction. To the extent such oral instruction varies from any written
confirming instruction, Custodian shall advise Custodian of

 such variance but unless a confirming written instruction is timely received,
such oral instruction shall govern.

           14.3 ADDRESSES FOR NOTICES. Unless otherwise specified herein, all
demands, notices, instructions, and other communications to be given hereunder
shall be sent, delivered or given to the recipient at the address, or the
relevant telephone number, set forth after its name hereinbelow:

                               To the Company:

                               PROGRESSIVE RETURN FUND, INC.
                               575 Lexington Avenue
                               New York, NY 10022
                               Attention:  RALPH W. BRADSHAW
                                           -----------------
                               Telephone: (212) 272 - 2093
                               Facsimile: (212) 272 - 5885

                               To Custodian:

                               CUSTODIAL TRUST COMPANY
                               101 Carnegie Center
                               Princeton, NJ 08540-6231
                               Attention: VICE PRESIDENT - TRUST OPERATIONS
                                          ---------------------------------
                               Telephone: (609) 951-2320
                               Facsimile: (609) 951-2327

                                      -20-
<PAGE>

or at such other address or telephone number as either party shall have provided
to the other by notice given in accordance with this Section 14.3. Writing shall
include transmissions by or through teletype, facsimile, central processing unit
connection, on-line terminal and magnetic tape.

           (d) With the prior consent in writing of Custodian, the Company may
give Remote Clearance Instructions (as defined hereinbelow) and Bulk Input
Instructions (as defined hereinbelow) for the receipt, delivery or transfer of
securities, provided that such Instructions are given in accordance with the
procedures prescribed by Custodian from time to time as to content of
instructions and their manner and timeliness of delivery by the Company.
Custodian shall be entitled to conclusively assume that all Remote Clearance
Instructions and Bulk Input Instructions have been given by an Authorized
Person, and Custodian is hereby irrevocably authorized to act in accordance
therewith. For purposes of this Agreement, "Remote Clearance Instructions" means
instructions that are input directly via a remote terminal which is located on
the premises of the Company or its agent and is linked to Custodian, and "Bulk
Input Instructions" means instructions that are input by bulk input computer
tape delivered to Custodian by messenger or transmitted to it via such
transmission mechanism as the Company and Custodian shall from time to time
agree upon.

                                   ARTICLE XV
                                   TERMINATION

           Either party hereto may terminate this Agreement by giving to the
other party a notice in writing specifying the date of such termination, which
shall be not less than sixty (60) days after the date of the giving of such
notice. Upon the date set forth in such notice this Agreement shall terminate,
and Custodian shall, upon receipt of a notice of acceptance by the successor
custodian, on that date (A) deliver directly to the successor custodian or its
agents all securities (other than securities held in a Book-Entry System or
Securities Depository) and other assets then owned by the Company and held by
Custodian as custodian, and (B) transfer any securities held in a Book-Entry
System or Securities Depository to an account of or for the benefit of the
Company, provided that the Company shall have paid to Custodian all fees,
expenses and other amounts to the payment or reimbursement of which it shall
then be entitled.

                                   ARTICLE XVI
                                  MISCELLANEOUS

           16.1 BUSINESS DAYS. Nothing contained in this Agreement shall require
Custodian to perform any function or duty on a day other than a Business Day.

           16.2 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York, without regard to the
conflict of law principles thereof.

           16.3 REFERENCES TO CUSTODIAN. The Company shall not circulate any
printed matter which contains any reference to Custodian without the prior
written approval of Custodian, excepting printed matter contained in the
prospectus or statement of additional information of the Company and such other
printed matter as merely identifies Custodian as Custodian for certain assets of
the Company. The Company shall submit printed matter requiring approval to
Custodian in draft form, allowing sufficient time for review by Custodian and
its counsel prior to any deadline for printing.

           16.4 NO WAIVER. No failure by either party hereto to exercise, and no
delay by such party in exercising, any right hereunder shall operate as a waiver
thereof. The exercise by either party hereto of any right hereunder shall not
preclude the exercise of any other right, and the remedies provided herein are
cumulative and not exclusive of any remedies provided at law or in equity.

           16.5 AMENDMENTS. This Agreement cannot be changed orally and, except
as otherwise provided herein with respect to the Schedules attached hereto, no
amendment to this Agreement shall be effective unless evidenced by an instrument
in writing executed by the parties hereto.

                                      -21-
<PAGE>

           16.6 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, and by the parties hereto on separate counterparts, each of which
shall be deemed an original but all of which together shall constitute but one
and the same instrument.

           16.7 SEVERABILITY. If any provision of this Agreement shall be
invalid, illegal or unenforceable in any respect under any applicable law, the
validity, legality and enforceability of the remaining provisions shall not be
affected or impaired thereby.

           16.8 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and assigns; PROVIDED, HOWEVER, that this Agreement shall not be assignable by
either party hereto without the written consent of the other party hereto. Any
purported assignment in violation of this Section 16.8 shall be void.

           16.9 JURISDICTION. Any suit, action or proceeding with respect to
this Agreement may be brought in the Supreme Court of the State of New York,
County of New York, or in the United States District Court for the Southern
District of New York, and the parties hereto hereby submit to the non-exclusive
jurisdiction of such courts for the purpose of any such suit, action or
proceeding, and hereby waive for such purpose any other preferential
jurisdiction by reason of their present or future domicile or otherwise.

           16.10 HEADINGS. The headings of sections in this Agreement are for
convenience of reference only and shall not affect the meaning or construction
of any provision of this Agreement.

           IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed and delivered in its name and on its behalf by its
representatives thereunto duly authorized, all as of the day and year first
above written.

                                              PROGRESSIVE RETURN COMPANY, INC.

                                              By:___________________________
                                                 Authorized Officer

                                              CUSTODIAL TRUST COMPANY

                                              By:____________________________
                                                 Authorized Officer

                                      -22-
<PAGE>

                                   SCHEDULE A

                        SIGNATURES OF AUTHORIZED PERSONS

           Set forth below are the names and specimen signatures of the persons
authorized by PROGRESSIVE RETURN FUND, INC. to administer the Custody Account of
the Company

NAME                                                          SIGNATURE

-------------------------------                        -------------------------

-------------------------------                        -------------------------

-------------------------------                        -------------------------

-------------------------------                        -------------------------

-------------------------------                        -------------------------

                                      -23-
<PAGE>

                                   SCHEDULE B
                                FEES AND CHARGES

           The Company shall pay Custodian the following fees and charges for
holdings and transactions in the United States:

           (1) an annual fee of 0.015% (one and one-half basis points) per annum
of the value of the assets in the Account;

           (2) a transaction charge of $10 for each receipt or delivery of
book-entry securities into or from the Custody Account (but not for any such
receipt or delivery in a repurchase transaction representing a cash sweep
investment for the Company's account);

           (3) a transaction charge of $40 for each receipt or delivery of
securities in physical form into or from the Custody Account;

           (4) a transaction charge for each repurchase transaction in the
Custody Account which represents a cash sweep investment for the Company's
account, computed at a rate of 0.10% (ten basis points) per annum on the amount
of the purchase price paid by the Company in such repurchase transaction, on the
basis of a 360-day year and for the actual number of days such repurchase
transaction is outstanding;

           (5) a charge of $7 for each "free" transfer of funds from the Custody
Account;

           (6) an administrative fee for each purchase in the Custody Account of
shares or other interests in a money market or other Company, which purchase
represents a cash sweep investment for the Company's account, computed for each
day that there is a positive balance in such Company to equal 1/365th of 0.10%
(ten basis points) on the amount of such positive balance for such day; and

           (7) a service charge for each holding of securities or other property
sold by way of private placement or in such other manner as to require services
by Custodian which in its reasonable judgment are materially in excess of those
ordinarily required for the holding of publicly traded securities in the United
States.

           INTERNATIONAL FEES. The Company shall pay Custodian fees for Foreign
Assets maintained outside the United States and charges for transactions outside
the United States (including, without limitation, charges for funds transfers
and tax reclaims) in accordance with such schedule of fees and charges for each
country in which Foreign Assets of such Portfolio are held as Custodian shall
from time to time provide to the Company. Any asset-based fee shall be based
upon the total market value of the applicable Foreign Assets as determined on
the last Business Day of the month for which such fee is charged. There shall be
a transaction charge of $30.00 for each receive or deliver of book-entry
securities into or from the Custody Account which is settled through Euroclear
or Clearstream (formerly CEDEL).

                                      -24-
<PAGE>

                                   SCHEDULE C
             APPROVED FOREIGN CUSTODIANS AND SECURITIES DEPOSITORIES

FOREIGN CUSTODIANS            COUNTRIES          FOREIGN SECURITIES DEPOSITORIES

                                      -25-
<PAGE>EXHIBIT 11
                            FORM OF CORPORATE OPINION

                                                                October __, 2002

Progressive Return Fund, Inc.
c/o Bear Stearns Funds Management Inc.
383 Madison Avenue
New York, New York 10179

Cornerstone Strategic Value Fund, Inc.
c/o Bear Stearns Funds Management Inc.
383 Madison Avenue
New York, New York 10179

Ladies and Gentlemen:

           We have acted as counsel to Progressive Return Fund, Inc. (the
"Acquiring Fund"), a Maryland corporation, and Cornerstone Strategic Value Fund,
Inc. (the "Target Fund") in connection with the Merger Agreement and Plan of
Reorganization (the "Agreement") dated as of October __, 2002, between Acquiring
Fund and the Target Fund. The Agreement describes a proposed transaction (the
"Transaction") to occur on or about October __, 2002 (the "Exchange Date"),
pursuant to which the Acquiring Fund will acquire substantially all of the
assets of the Target Fund in exchange for shares of Common Stock in the
Acquiring Fund (the "Acquiring Fund Shares") and the assumption by the Acquiring
Fund of all of the liabilities of the Target Fund following which the Acquiring
Fund Shares received by the Target Fund will be distributed by the Target Fund
to its shareholders in liquidation and termination of the Target Fund. This
opinion is furnished to you pursuant to the terms of the Agreement. Capitalized
terms not defined herein are used herein as defined in the Agreement.

           In such capacity, we have examined either originals, copies or
facsimile copies, certified, conformed or otherwise authenticated to our
satisfaction, of such corporate records, agreements and instruments of the
Acquiring Fund and Target Fund, certificates of officers of the Acquiring Fund
and the Target Fund, certificates of public officials, and such other documents
and records, including, but not limited to, the Agreement, the By-laws of each
fund, as amended, Written Consents of the Board of Directors (the "Board") of
each fund, and have made such other inquiries of law and fact, as we have deemed
appropriate as a basis for the opinions hereinafter expressed.

<PAGE>

           In all cases we have assumed the authenticity of original documents
and the conformity to authentic originals of all copies examined by us.

           As to certain matters of fact material to this opinion, we have,
where such facts were not independently known to us, relied without independent
investigation upon the representations and warranties made by the each fund in
certificates of the officers of each fund, and upon certificates of public
officials. In the course of our representation of each fund, nothing has come to
our attention which leads us to believe that any such reliance was unreasonable.

           Opinion number (iii) herein, which is qualified by our knowledge, is
limited to the actual knowledge of facts on the part of the attorney in this
Firm who has signed this opinion letter, who has had active involvement in
negotiating the transactions contemplated by the Agreement or in preparing this
opinion letter, or who has substantial responsibility for this Firm's
representation of each fund, and, with respect to any portions herein so
qualified, we have made no independent investigation or review for purposes of
this opinion letter.

           The opinions expressed herein are limited to matters governed by the
laws of the State of New York and the federal securities laws of the Unites
States and the rules and regulations promulgated thereunder. Matters governed by
the laws of the State of Maryland have been addressed in a separate opinion
letter issued by The Law Offices of Stephanie A. Djinis, special Maryland
counsel, a copy of which is attached hereto, the original having been provided
directly to you.

           Based upon and subject to the foregoing, we are of the opinion that:

           (i) the Acquiring Fund and the Target Fund are each a duly
registered, closed-end, management investment company, and its registration with
the SEC as an investment company under the 1940 Act is in full force and
effect;

           (ii) the Acquiring Fund Shares to be issued to the Target Fund and
then distributed to the Target Fund shareholders pursuant to the Agreement are
duly registered under the Securities Act of 1933, as amended, on the appropriate
form, and are duly authorized and upon such issuance will be validly issued and
outstanding, fully paid and non-assessable;

           (iii) to our knowledge, no stop order suspending the effectiveness
thereof has been issued and no proceedings for that purpose have been instituted
or are pending or threatened; and

                                      -2-
<PAGE>

           (iv) we have participated in conferences with officers and other
representatives of the Target Fund and the Acquiring Fund and the independent
public accountants for each such Fund at which the contents of the proxy
statement of the Target Fund and the prospectus and statement of additional
information of the Acquiring Fund and related matters were discussed and,
although this Firm does not pass upon nor assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the proxy
statement, the prospectus or the statement of additional information of the
Acquiring Fund, no facts came to our attention that would lead us to believe
that either the proxy statement, at the time such proxy statement became
effective and at the date hereof, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, or that the prospectus
and the statement of additional information of the Acquiring Fund, as of its
date and at the date hereof, contained an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.

           This opinion is rendered solely for the benefit of the Acquiring Fund
and Target Fund in connection with the reorganization and liquidation of the
Target Fund and may not be relied upon by any other person or for any other
purpose without our prior written consent, and we consent to the filing of this
opinion with the Securities and Exchange Commission in connection with the
registration of the Acquiring Fund's shares.

                                                 Very truly yours,

                                                 SPITZER & FELDMAN P.C.

                                      -3-
<PAGE>

                              FORM OF LEGAL OPINION

Spitzer & Feldman P.C.
405 Park Avenue
New York, New York

Ladies and Gentlemen:

           We have acted as special counsel in connection with your
representation of Progressive Return Fund, Inc. (the "Acquiring Fund"), a
Maryland corporation, and Corner Strategic Value Fund, Inc. (the "Target Fund").
We are rendering this opinion to address certain matters regarding the issuance
of shares of common stock of Acquiring Fund ("Shares") arising under Maryland
law for which a legal opinion is to be provided by your firm pursuant to the
Merger Agreement and Plan of Reorganization ("Agreement") dated as of October
__, 2002, between Acquiring Fund and the Target Fund. The Agreement provides for
Target Fund to transfer all of its assets to Acquiring Fund in exchange solely
for Acquiring Fund's shares and Acquiring Fund's assumption of the liabilities
of Target Fund.

           In connection with this opinion, we have examined certified or other
copies, believed by us to be genuine but whose genuineness has not been
independently verified, of Acquiring Fund's Articles of Incorporation and
By-Laws, the Agreement, minutes of meetings of Acquiring Fund's board of
directors, a certificate of good standing of Acquiring Fund issued by the State
of Maryland Department of Assessments and Taxation, and documentation regarding
the number of shares of Acquiring Fund and Target Fund authorized and the number
of shares outstanding as of [December 31, 2001.] Our opinion is limited to the
laws (other than the conflict of law rules) of the State of Maryland in
existence on the date hereof that in our experience are normally applicable to
the issuance of shares of common stock by corporations. We have not relied upon
any other records or documents of the Company in rendering this opinion.

           Based on the foregoing, as of the date hereof we are of the opinion
that: the Acquiring Fund Shares to be issued and distributed to the shareholders
of Target Fund under the Agreement, assuming their due delivery as contemplated
by the Agreement and the receipt of consideration in exchange therefor as
described therein, will be duly authorized and validly issued and outstanding
and fully paid and non-assessable.

           This opinion is intended solely for your benefit and is not to be
made available to or be relied upon by any other person, firm or entity without
our prior written consent; we understand that you will rely upon this opinion in
rendering your opinion under the Agreement as described above and you will file
this opinion with the Securities and Exchange Commission in connection with the
registration of the Acquiring Fund's shares.

                                                      Very truly yours,

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