EX-99.23(G)(2) 5 dex9923g2.htm FORM OF DELEGATION AGREEMENT form of Delegation Agreement

Exhibit 23.(g)(2)

 

Form of Delegation Agreement

 

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