EX-99.(G)(2) 6 dex99g2.htm DELEGATION AGREEMENT Delegation Agreement

Exhibit 23(g)(2)

 

Form of Delegation Agreement between Transamerica Investors, Inc. and Investors Bank & Trust Company

FORM OF DELEGATION AGREEMENT

 

AGREEMENT, dated as of October 1, 2003 by and between INVESTORS BANK & TRUST COMPANY, a Massachusetts trust company (the “Delegate”), and Transamerica Investors, Inc. on behalf of Transamerica Premier Funds, a Maryland corporation (the “Fund”).

 

WHEREAS, pursuant to the provisions of Rule 17f-5 under the Investment Company Act of 1940, as amended (the “1940 Act”), and subject to the terms and conditions set forth herein, the Board of Directors of the Fund desires to delegate to the Delegate certain responsibilities concerning Foreign Assets (as defined below), and the Delegate hereby agrees to retain such delegation, as described herein; and

 

WHEREAS, pursuant to the provisions of Rule 17f-7 under the 1940 Act, and subject to the terms and conditions set forth herein, the Board of Directors of the Fund desires to retain the Delegate to provide certain services concerning Foreign Assets, and the Delegate hereby agrees to provide such services, as described herein;

 

NOW THEREFORE, in consideration of the premises and of the mutual agreements contained herein, the parties hereto agree as follows:

 

1. Definitions

 

Capitalized terms in this Agreement have the following meanings:

 

  a. Authorized Representative

 

Authorized Representative means any one of the persons who are empowered, on behalf of the parties to this Agreement, to receive notices from the other party and to send notices to the other party.

 

  b. Board

 

Board means the Board of Directors (or the body authorized to exercise authority similar to that of the board of directors of a corporation) of Fund.

 

  c. Country Risk

 

Country Risk means all factors reasonably related to the systemic risk of holding Foreign Assets in a particular country including, but not limited to, such country’s financial infrastructure (including any Securities Depositories operating in such country); prevailing custody and settlement practices; and laws applicable to the safekeeping and recovery of Foreign Assets held in custody.

 

  d. Eligible Foreign Custodian

 

Eligible Foreign Custodian has the meaning set forth in Rule 17f-5(a)(1) and it is understood that such term includes foreign branches of U.S. Banks (as the term “U.S. Bank” is defined in Rule 17f-5(a)(7)).

 

  e. Foreign Assets

 

Foreign Assets has the meaning set forth in Rule 17f-5(a)(2)

 

  f. Foreign Custody Manager

 

Foreign Custody Manager has the meaning set forth in Rule 17f-5(a)(3).

 

  g. Securities Depository

 

Securities Depository has the meaning set forth in Rule 17f-4(a).

 

  h. Monitor

 

Monitor means to re-assess or re-evaluate, at reasonable intervals, a decision, determination or analysis previously made.

2. Representations

 

  a. Delegate’s Representations

 

Delegate represents that it is a trust company chartered under the laws of the Commonwealth of Massachusetts. Delegate further represents that the persons executing this Agreement and any amendment or appendix hereto on its behalf are duly authorized to so bind the Delegate with respect to the subject matter of this Agreement.

 

  b. Fund’s Representations

 

Fund represents that the Board has determined that it is reasonable to rely on Delegate to perform the responsibilities described in this Agreement. Fund further represents that the persons executing this Agreement and any amendment or appendix hereto on its behalf are duly authorized to so bind the Fund with respect to the subject matter of this Agreement.

 

3. Jurisdictions and Depositories Covered

 

  a. Initial Jurisdictions and Depositories

 

The authority delegated by this Agreement in connection with Rule 17f-5 applies only with respect to Foreign Assets held in the jurisdictions listed in Appendix A1. Delegate’s responsibilities under this Agreement in connection with Rule 17f-7 apply only with respect to the Securities Depositories listed in Appendix A2. Upon the creation of a new Securities Depository in any of the jurisdictions listed in Appendix A1 at the time of such creation, such Securities Depository will automatically be deemed to be listed in Appendix A2 and will be covered by the terms of this Agreement.

 

  b. Added Jurisdictions and Depositories

 

Jurisdictions and related Securities Depositories may be added to Appendix A1 and Appendix A2, respectively, by written agreement in the form of Appendix B. Delegate’s responsibility and authority with respect to any jurisdiction or Securities Depository, respectively, so added will commence at the later of (i) the time that Delegate’s Authorized Representative and Board’s Authorized Representative have both executed a copy of Appendix B listing such jurisdiction and/or Securities Depository, or (ii) the time that Delegate’s Authorized Representative receives a copy of such fully executed Appendix B.

 

  c. Withdrawn Jurisdictions

 

Board may withdraw its (i) delegation to Delegate with respect to any jurisdiction or (ii) retention of Delegate with respect to any Securities Depository, upon written notice to Delegate. Delegate may withdraw its (i) acceptance of delegation with respect to any jurisdiction or (ii) retention with respect to any Securities Depository, upon written notice to Board. Ten days (or such longer period as to which the parties agree in such event) after receipt of any such notice by the Authorized Representative of the party other than the party giving notice, Delegate shall have no further responsibility or authority under this Agreement with respect to the jurisdiction(s) or Securities Depository as to which delegation is withdrawn.

 

4. Delegation of Authority to Act as Foreign Custody Manager

 

  a. Selection of Eligible Foreign Custodians

 

Subject to the provisions of this Agreement and the requirements of Rule 17f-5 (and any other applicable law), Delegate is authorized and directed to place and maintain Foreign Assets in the care of any Eligible Foreign Custodian(s) selected by Delegate in each jurisdiction to which this Agreement applies, except that Delegate does not accept such authorization and direction with regard to Securities Depositories.

 

  b. Contracts With Eligible Foreign Custodians

 

Subject to the provisions of this Agreement and the requirements of Rule 17f-5 (and any other applicable

law), Delegate is authorized to enter into, on behalf of Fund, such written contracts governing Fund’s foreign custody arrangements with such Eligible Foreign Custodians as Delegate deems appropriate.

 

5. Monitoring of Eligible Foreign Custodians and Contracts

 

In each case in which Delegate has exercised the authority delegated under this Agreement to place Foreign Assets with an Eligible Foreign Custodian, Delegate is authorized to, and shall, on behalf of Fund, establish a system to Monitor the appropriateness of maintaining Foreign Assets with such Eligible Foreign Custodian. In each case in which Delegate has exercised the authority delegated under this Agreement to enter into a written contract governing Fund’s foreign custody arrangements, Delegate is authorized to, and shall, on behalf of Fund, establish a system to Monitor the appropriateness of such contract.

 

6. Securities Depositories

 

a. In accordance with the requirements of Rule 17f-7, Delegate shall, by no later than July 2, 2001, provide the Fund or its investment adviser with an analysis of the custody risks associated with maintaining assets with each Securities Depository listed on Appendix A2 hereto.

 

b. In accordance with the requirements of Rule 17f-7, Delegate shall Monitor the custody risks associated with maintaining assets with each Securities Depository listed on Appendix A2 hereto on a continuing basis, and shall promptly notify the Fund or its investment adviser of any material change in such risks.

 

7. Guidelines and Procedures for the Exercise of Delegated Authority

 

  a. Board’s Conclusive Determination Regarding Country Risk

 

In exercising its delegated authority under this Agreement, Delegate may assume, for all purposes, that Board (or Fund’s investment advisor, pursuant to authority delegated by Board) has considered, and pursuant to its fiduciary duties to Fund and Fund’s shareholders, determined to accept, such Country Risk as is incurred by placing and maintaining Foreign Assets in the jurisdictions to which this Agreement applies. In exercising its delegated authority under this Agreement, Delegate may also assume that Board (or Fund’s investment advisor, pursuant to authority delegated by Board) has, and will continue to, Monitor such Country Risk to the extent Board deems necessary or appropriate.

 

Except as specifically described herein, nothing in this Agreement shall require Delegate to make any selection or to engage in any Monitoring on behalf of Fund that would entail consideration of Country Risk.

 

  b. Selection of Eligible Foreign Custodians

 

In exercising the authority delegated under this Agreement to place Foreign Assets with an Eligible Foreign Custodian, Delegate shall determine that Foreign Assets will be subject to reasonable care, based on the standards applicable to custodians in the market in which the Foreign Assets will be held, after considering all factors relevant to the safekeeping of such Foreign Assets, including, without limitation;

 

  i. The Eligible Foreign Custodian’s practices, procedures, and internal controls, including, but not limited to, the physical protections available for certificated securities (if applicable), the method of keeping custodial records, and the security and data protection practices;

 

  ii. Whether the Eligible Foreign Custodian has the financial strength to provide reasonable care for Foreign Assets;

 

  iii. The Eligible Foreign Custodian’s general reputation and standing;

 

  iv. Whether Fund will have jurisdiction over and be able to enforce judgments against the Eligible Foreign Custodian, such as by virtue of the existence of any offices of the Eligible Foreign Custodian in the United States or the Eligible Foreign Custodian’s consent to service of process in the United States;

  v. In the case of an Eligible Foreign Custodian that is a banking institution or trust company, any additional factors and criteria set forth in Appendix C to this Agreement; and

 

  c. Evaluation of Written Contracts

 

In exercising the authority delegated under this Agreement to enter into written contracts governing Fund’s foreign custody arrangements with an Eligible Foreign Custodian, Delegate shall determine that such contracts provide reasonable care for Foreign Assets based on the standards applicable to Eligible Foreign Custodians in the relevant market. In making this determination, Delegate shall ensure that the terms of such contracts comply with the provisions of Rule 17f-5(c)(2).

 

  d. Monitoring of Eligible Foreign Custodians

 

In exercising the authority delegated under this Agreement to establish a system to Monitor the appropriateness of maintaining Foreign Assets with an Eligible Foreign Custodian or the appropriateness of a written contract governing Fund’s foreign custody arrangements, Delegate shall consider any factors and criteria set forth in Appendix D to this Agreement. If, as a result of its Monitoring of Eligible Foreign Custodian relationships hereunder or otherwise, the Delegate determines in its sole discretion that it is in the best interest of the safekeeping of the Foreign Assets to move such Foreign Assets to a different Eligible Foreign Custodian, the Fund shall bear any expense related to such relocation of Foreign Assets.

 

8. Standard of Care

 

a. In exercising the authority delegated under this Agreement with regard to its duties under Rule 17f-5, Delegate agrees to exercise reasonable care, prudence and diligence such as a person having responsibility for the safekeeping of Foreign Assets of an investment company registered under the 1940 Act would exercise.

 

b. In carrying out its responsibilities under this Agreement with regard to Rule 17f-7, Delegate agrees to exercise reasonable care, prudence and diligence.

 

9. Reporting Requirements

 

Delegate agrees to provide written reports notifying Board of the placement of Foreign Assets with a particular Eligible Foreign Custodian and of any material change in Fund’s arrangements with such Eligible Foreign Custodians. Such reports shall be provided to Board quarterly for consideration at the next regularly scheduled meeting of the Board or earlier if deemed necessary or advisable by the Delegate in its sole discretion.

 

10. Provision of Information Regarding Country Risk

 

With respect to the jurisdictions listed in Appendix A1, or added thereto pursuant to Article 3, Delegate agrees to provide the Board and the Fund’s investment adviser with access to Eyes to the WorldTM, a service available through the Delegate’s Web Site at www.ibtco.com, containing information relating to Country Risk, if available, as is specified in Appendix E to this Agreement. Such information relating to Country Risk shall be updated from time to time as the Delegate deems necessary.

 

11. Limitation of Liability.

 

a. Notwithstanding anything in this Agreement to the contrary, in no event shall the Delegate or any of its officers, directors, employees or agents (collectively, the “Indemnified Parties”) be liable to the Fund or any third party, and the Fund shall indemnify and hold the Delegate and the Indemnified Parties harmless from and against any and all loss, damage, liability, actions, suits, claims, costs and expenses, including legal fees, (a “Claim”) arising as a result of any act or omission of the Delegate or any Indemnified Party under this Agreement, except for any Claim resulting solely from the negligence, willful misfeasance or bad faith of the Delegate or any Indemnified Party. Without limiting the foregoing, neither the Delegate nor the Indemnified Parties shall be liable for, and the Delegate and the Indemnified Parties shall be indemnified against, any Claim arising as a result of:

 

  i. Any act or omission by the Delegate or any Indemnified Party in reasonable good faith reliance upon the terms of this Agreement, any resolution of the Board, telegram, telecopy, notice, request, certificate or other instrument reasonably believed by the Delegate to be genuine;

  ii. Any information which the Delegate provides or does not provide under Section 10 hereof;

 

  iii. Any acts of God, earthquakes, fires, floods, storms or other disturbances of nature, epidemics, strikes, riots, nationalization, expropriation, currency restrictions, acts of war, civil war or terrorism, insurrection, nuclear fusion, fission or radiation, the interruption, loss or malfunction of utilities, transportation or computers (hardware or software) and computer facilities, the unavailability of energy sources and other similar happenings or events.

 

b. Notwithstanding anything to the contrary in this Agreement, in no event shall the Delegate or the Indemnified Parties be liable to the Fund or any third party for lost profits or lost revenues or any special, consequential, punitive or incidental damages of any kind whatsoever in connection with this Agreement or any activities hereunder.

 

12. Effectiveness and Termination of Agreement

 

This Agreement shall be effective as of the later of the date of execution on behalf of Board or Delegate and shall remain in effect until terminated as provided herein. This Agreement may be terminated at any time, without penalty, by written notice from the terminating party to the non-terminating party. Termination will become effective 30 days after receipt by the non-terminating party of such notice.

 

13. Authorized Representatives and Notices

 

The respective Authorized Representatives of Fund and Board, and the addresses to which notices and other documents under this Agreement are to be sent to each, are as set forth in Appendix F. Any Authorized Representative of a party may add or delete persons from that party’s list of Authorized Representatives by written notice to an Authorized Representative of the other party.

 

14. Governing Law

 

This Agreement shall be constructed in accordance with the laws of the Commonwealth of Massachusetts without regard to principles of choice of law.

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized representatives as of the date first written above.

 

INVESTORS BANK & TRUST COMPANY

By:    
 

Name:

Title:  

 

TRANSAMEICA INVESTORS, INC. on behalf of TRANSAMERICA PREMIER FUNDS

By:    
 

Name:

Title:

 

List of Appendices

 

A1 — Jurisdictions Covered

 

A2 – Securities Depositories Covered

B — Additional Jurisdictions/Securities Depositories Covered

 

C — Additional Factors and Criteria To Be Applied in the Selection of Eligible                                               Foreign Custodians That Are Banking Institutions or Trust Companies

 

D — Factors and Criteria To Be Applied in Establishing Systems For the                                                                   Monitoring of Foreign Custody Arrangements and Contracts

 

E — Information Regarding Country Risk

 

F — Authorized Representatives

APPENDIX A1

 

Jurisdictions Covered

 

[delete those countries which are not delegated]

Argentina

    Kenya

Austria

    Korea

Australia

    Latvia

Bahrain

    Lebanon

Bangladesh

    Lithuania

Belgium

    Luxembourg

Bermuda

    Malaysia

Bolivia

    Mauritius

Botswana

    Mexico

Brazil

    Morocco

Bulgaria

    Namibia

Canada

    Netherlands

Chile

    New Zealand

China

    Norway

Clearstream (Cedel)

    Oman

Colombia

    Pakistan

Costa Rica

    Panama

Croatia

    Papau New Guinea

Cyprus

    Peru

Czech Republic

    Philippines

Denmark

    Poland

Ecuador

    Portugal

Egypt

    Romania

Estonia

    Russia

Euroclear

    Singapore

Finland

    Slovak Republic

France

    Slovenia

Germany

    South Africa

Ghana

    Spain

Greece

    Sri Lanka

Hong Kong

    Swaziland

Hungary

    Sweden

Iceland

    Switzerland

India

    Taiwan

Indonesia

    Thailand

Ireland

    Turkey

Israel

    Ukraine

Italy

    United Kingdom

Ivory Coast

    Uruguay

Japan

    Venezuela

Jordan

    Zambia

Kazakhstan

    Zimbabwe

APPENDIX A2

 

Securities Depositories Covered

 

Argentina

  

CDV

CRYL

  

Philippines

  

PCD

RoSS

Australia

  

Austraclear Ltd.

CHESS

RITS

  

Poland

  

CRBS

NDS

Austria

  

OeKB AG

  

Portugal

  

Central de Valores Mobiliarios

Bahrain

  

None

  

Romania

  

NBR

SNCDD

Stock Exchange Registry, Clearing & Settlement

Bangladesh

  

None

  

Russia

  

DCC

NDC

VTB

Belgium

  

BKB

CIK

  

Singapore

  

CDP

MAS

Bermuda

  

None

  

Slovak Republic

  

NBS

SCP

Botswana

  

None

  

Slovenia

  

KDD

Brazil

  

CBLC

CETIP

SELIC

  

South Africa

  

STRATE

The Central Depository (Pty) Ltd.

Bulgaria

  

The Bulgarian National Bank

The Central Depository

  

Spain

  

Banco de Espana

SCLV

Canada

  

Bank of Canada

CDS

  

Sri Lanka

  

CDS

Chile

  

DCV

  

Sweden

  

VPC AB

China

  

SSCC

SSCCRC

  

Switzerland

  

SIS SegaIntersettle AG

Clearstream

      

Taiwan

  

TSCD

Colombia

  

DCV

DECEVAL

  

Thailand

  

TSD

 

Costa Rica

  

CEVAL

  

Turkey

  

CBT

Takasbank

Croatia

  

CNB

Ministry of Finance

SDA

  

Ukraine

  

Depository of the National Bank of Ukraine

MFS Depository

Czech Republic

  

SCP

TKD

  

Uruguay

  

None

Denmark

  

VP

  

United Kingdom

  

CMO

CREST

Ecuador

  

DECEVALE, S.A.

  

Venezuela

  

BCV

CVV

Egypt

  

Misr for Clearing, Settlement & Dep.

  

Zambia

  

Bank of Zambia
LuSE CSD

Estonia

  

ECDSL

  

Zimbabwe

  

None

Euroclear

            

Finland

  

APK

        

France

  

Sicovam SA

        

Germany

  

Clearstream

        

Ghana

  

None

        

Greece

  

Bank of Greece

CSD

        

Hong Kong

  

CCASS

CMU

        

Hungary

  

Keler Ltd.

        

India

  

CDSL

NSDL

        

Indonesia

  

Bank Indonesia

PT.KSEI

        

Ireland

  

CREST

Gilt Settlement Office

        

Israel

  

TASE Clearing House Ltd.

        

Italy

  

Banca d-Italia

Monte Titoli

        

 

Ivory Coast*

  

Depositaire Central/Banque de Reglement

        

Japan

  

Bank of Japan

JASDEC

        

Jordan

  

SDC

        

Kazakhstan

  

Kazakhstan Central Securities Depository

        

Kenya

  

Central Bank of Kenya Central Depository

        

Korea

  

KSD

        

Latvia

  

Bank of Latvia

LCD

        

Lebanon

  

Banque de Liban

MIDCLEAR

        

Lithuania

  

CSDL

        

Luxembourg

  

Clearstream

        

Malaysia

  

BNM (SSTS)

MCD

        

Mauritius

  

CDS

        

Mexico

  

S.D. Indeval

        

Morocco

  

Maroclear S.A.

        

Netherlands

  

NECIGEF

        

New Zealand

  

New Zealand Central Securities Depository

        

Norway

  

VPS

        

Oman

  

MDSRC

        

Pakistan

  

Central Depository Co.

of Pakistan Limited

State Bank of Pakistan

        

Peru

  

CAVALI

        

 

* Benin, Burkina-Faso, Guinea Bissau, Mali, Nigeria, Senegal, and Togo are available through the Ivory Coast

 

APPENDIX B

 

Additional Jurisdictions Covered

 

Pursuant to Article 3 of this Agreement, Delegate and Board agree that the following jurisdictions shall be added to Appendix A1:

 

[insert additional countries/depositories]

 

INVESTORS BANK & TRUST COMPANY
By:    
 

Name:

    

Title:

    

 

TRANSAMERICA INVESTORS, INC. on behalf of TRANSAMERICA PREMIER FUNDS

By:

    
 

Name:

    

Title:

    

DATE:

    
 

 

APPENDIX C

 

Additional Factors and Criteria To Be Applied

in the Selection of Eligible Foreign Custodians

That Are Banking Institutions or Trust Companies

 

In addition to the factors set forth in Rule 17f-5(c)(1), in selecting Eligible Foreign Custodians that are banking institutions or trust companies, Delegate shall consider the following factors, if such information is available (check all that apply):

 

                     None

 

                     Other (list below):

 

APPENDIX D

 

Factors and Criteria To Be Applied

in the Establishing Systems For the Monitoring of

Foreign Custody Arrangements and Contracts

 

In establishing systems for the Monitoring of foreign custody arrangements and contracts with Eligible Foreign Custodians, Delegate shall consider the following factors, if such information is available:

 

  1. Operating performance

 

  2. Established practices and procedures

 

  3. Relationship with market regulators

 

  4. Contingency planning

 

APPENDIX E

 

Information Regarding Country Risk

 

To aid the Board in its determinations regarding Country Risk, Delegate will furnish Board annually with respect to the jurisdictions specified in Article 3, the following information:

 

1. Copy of Addenda or Side Letters to Subcustodian Agreements

 

2. Legal Opinion, if available, with regard to:

 

  a) Access to books and records by the Fund’s accountants

 

  b) Ability to recover assets in the event of bankruptcy of a custodian

 

  c) Ability to recover assets in the event of a loss

 

  d) Likelihood of expropriation or nationalization, if available

 

  e) Ability to repatriate or convert cash or cash equivalents

 

3. Audit Report

 

4. Copy of Balance Sheet from Annual Report

 

5. Country Profile Matrix containing market practice for:

 

  a) Delivery versus payment

 

  b) Settlement method

 

  c) Currency restrictions

 

  d) Buy-in practice

 

  e) Foreign ownership limits

 

  f) Unique market arrangements

 

APPENDIX F

Authorized Representatives

 

The names and addresses of each party’s authorized representatives are set forth below:

 

  A. Board

 

With a copy to:

 

  B. Delegate

 

Investors Bank & Trust Company

200 Clarendon Street

P.O. Box 9130

Boston, MA 02117-9130

Attention: Robert C. Conron, Director, Client Management

Fax: (617) 330-6033

 

With a copy to:

 

Investors Bank & Trust Company

200 Clarendon Street

P.O. Box 9130

Boston, MA 02117-9130

Attention: Andrew S. Josef, Assistant General Counsel

Fax: (617) 946-1929