Exhibit 23 (e) Form of Distribution Agreement between Transamerica Investors
Inc., and Transamerica Securities Sales Corporation ("TSSC")
TRANSAMERICA INVESTORS, INC.
DISTRIBUTION AGREEMENT
AS AMENDED AND RESTATED ON MAY 7, 1999
THIS AGREEMENT is made and entered into this 21st day of July, 1999, by
and between TRANSAMERICA INVESTORS, INC., a corporation organized and existing
under the laws of the state of Maryland (the "Corporation"), and TRANSAMERICA
SECURITIES SALES CORPORATION, a corporation organized and existing under the
laws of the State of Maryland (the "Distributor").
WHEREAS the Corporation and the Distributor wish to restate the
Distribution Agreement as amended and restated on May 8, 1998;
WHEREAS, the Corporation is registered as an open-end management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"), consisting of several portfolios of shares (the "Funds");
WHEREAS, the Corporation is registering the shares of its common stock
for offer and sale to the public under the Securities Act of 1933, as amended
(the "1933 Act"), and in accordance with the provisions of all applicable state
securities laws (the "Blue Sky Laws");
WHEREAS, each Fund is authorized to issue four classes of shares:
Investor Shares, Institutional Shares, Class A Shares and Class M Shares
(collectively, the "Shares"), each of which represents interests in the same
portfolio of investment securities;
WHEREAS, the Distributor is a broker-dealer registered with the
Securities and Exchange Commission (the "Commission") under the Securities
Exchange Act of 1934, as amended (the "1934 Act") and is a member of the
National Association of Securities Dealers, Inc. (the "NASD"); and
WHEREAS, the Corporation has adopted a number of distribution plans
pursuant to Section 12(b) of the 1940 Act, and Rule 12b-1 thereunder (the "12b-1
Plans"), pursuant to which the Corporation may pay the expenses for certain
Distribution Activities and Service Activities (as defined in the 12b-1 Plans)
incurred or paid by the Distributor;
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, the parties hereto agree as follows:
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I. APPOINTMENT AND OBLIGATIONS OF THE DISTRIBUTOR
The Corporation hereby appoints the Distributor as its exclusive agent
to sell and distribute, as set forth below in Section II, the Shares of each
class of each Fund and of such other Funds and classes of Shares of the Funds as
may hereafter be registered with the Commission and under the Blue Sky Laws,
subject to the terms of this Agreement and the policies and control of the
Corporation's Board of Directors (the "Board"). The Distributor hereby accepts
such appointment.
II. DUTIES OF THE DISTRIBUTOR AND THE CORPORATION
The Corporation employs the Distributor:
A. to promote the Funds;
B. to sell the Shares of each Fund on a best efforts basis from
time to time during the term of this Agreement as agent for the
Corporation and upon the terms described in the currently
effective registration statement of the Corporation, and
supplements thereto, under the 1933 Act and the 1940 Act (the
"Registration Statement"). The Distributor shall sell, as agent
for the Funds, directly or through other broker-dealers, as
described below, the Shares needed, but not more than the Shares
needed (except for clerical errors or errors of transmission),
to fill unconditional orders placed with the Distributor;
C. to enter into agreements, at the Distributor's discretion, to
sell Shares to such registered and qualified retail
broker-dealers, including Transamerica Financial Resources, Inc.
("TFR"), subject to the approval by the Board of the form or
forms of such agreements. All such brokers and dealers shall act
in accordance with the Registration Statement and shall comply
with all applicable laws, rules and regulations;
D. in connection with the sales and offers of sale of Shares, to
give only such information and make such representations as is
permitted by applicable law. All sales literature and
advertisements used by the Distributor in connection with the
sale of the Shares shall be filed with the appropriate
authorities, including the NASD, the states, and/or the
Commission, as may be required from time to time. The Corporation
shall not be responsible in any way for any other information,
statements or representations given or made by the Distributor or
its representatives or agents. Normally, the Corporation will not
exercise any direction or control over the time and place of
solicitation, the persons to be solicited, or the manner of
solicitation. But the Distributor agrees that solicitations will
be in a form acceptable to the Corporation and will be subject to
such terms and conditions as may be prescribed from time to time
by the Board;
E. to offer the Shares of each Fund at the offering price described
in the Registration Statement. The Corporation shall promptly
furnish (or arrange for another person to furnish) the
Distributor with a quotation of the net asset value per Share on
each business day; and
The Distributor shall not be obligated to sell any certain number of
Shares.
The Corporation agrees:
A. that it will not, without the Distributor's consent, sell or
agree to sell any Shares of the Corporation other than through
the Distributor, except that the Corporation may:
1. issue or sell Shares in connection with its merger or
consolidation with any other investment company or the
Corporation's acquisition by purchase or otherwise of all or
substantially all of the assets of any investment company or
substantially all of the outstanding shares of any such company;
2. offer Shares to its shareholders for reinvestment of cash
distribution from capital gains or net investment income of the
Corporation;
3. issue Shares to shareholders of a Fund who exercise any exchange
privilege set forth in the Registration Statement;
4. issue Shares directly to registered shareholders pursuant to the
authority of the Board; or
5. sell Shares in any jurisdiction in which the Distributor is not
registered as a broker-dealer.
B. to permit the Distributor to use any list of shareholders of the
Corporation or any Fund or any other list of investors which it
obtains in connection with its provision of services under this
Agreement;
C. to keep the Distributor fully informed of its affairs and to
make available to the Distributor copies of all information,
financial statements, and other papers which the Distributor may
reasonably request for use in connection with the distribution
of Shares, including, without limitation, certified copies of
any financial statements for the Corporation by its independent
public accountant and such reasonable number of copies of the
most current prospectus, statement of additional information,
and annual and interim reports of a Fund as the Distributor may
request;
D. to cooperate fully in the efforts of the Distributor to sell and
arrange for the sale of the Shares and in the performance of the
Distributor under this Agreement; and
E. to register or cause to be registered all Shares sold by the
Distributor pursuant to the provisions of this Agreement in such
name or names and amounts as the Distributor may request from
time to time.
The Corporation reserves the right at any time to withdraw all
offerings of the Shares of any or all Funds by written notice to the Distributor
at its principal office.
The Corporation and the Distributor hereby agree that all
advertisements and sales literature issued by either of them referring directly
or indirectly to the Corporation or to the Distributor will be submitted to and
receive the approval of the Corporation and the Distributor before it may be
used by either party.
III. REPRESENTATIONS AND WARRANTIES
A. REPRESENTATIONS AND WARRANTIES OF THE DISTRIBUTOR
The Distributor hereby represents and warrants to the Corporation as
follows:
1. Due Incorporation and Organization. The Distributor is duly
organized and is in good standing under the laws of the State of
Maryland and is fully authorized to enter into this Agreement and
carry out its terms.
2. Registration. The Distributor is a broker-dealer
registered with the Commission under the 1934 Act, is a
member of the NASD, and is registered or licensed under
the laws of all jurisdictions in which its activities
require it to be so registered or licensed. The
Distributor shall maintain such registration or license
in effect at all times during the term of this
Agreement and will immediately notify the Corporation
of the occurrence of any event that would disqualify
the Distributor from serving as a Distributor by
operation of Section 9(a) of the 1940 Act or otherwise.
3. Best Efforts. The Distributor at all times shall provide its best
judgement and effort to the Corporation in carrying out its
obligations hereunder.
4. Code of Ethics. The Distributor has adopted a written
code of ethics that complies with the requirements of
Rule 17j-1 under the 1940 Act and will provide the
Corporation with a copy of such code of ethics and all
subsequent modifications, together with evidence of its
adoption. At least annually the Distributor will
provide the Corporation with a report describing the
implementation of the code of ethics during the
immediately preceding twelve (12) month period.
B. REPRESENTATIONS AND WARRANTIES OF THE CORPORATION
The Corporation, on behalf of the Funds, hereby represents and warrants
to the Distributor as follows:
1. Due Incorporation and Organization. The Corporation is duly
organized under the laws of the State of Maryland and is fully
authorized to enter into this Agreement and carry out its terms.
2. Registration. The Corporation is registered as an
investment company with the Commission under the 1940
Act and Shares of the Corporation will be registered
for offer and sale to the public under the 1933 Act and
under the Blue Sky Laws. Such registrations shall be
kept in effect during the term of this Agreement.
IV. COMPLIANCE WITH APPLICABLE REQUIREMENTS
In carrying out its obligations under this Agreement, the Distributor
shall at all times conform to:
A. all applicable provisions of the 1934 Act and the 1940 Act and
the rules and regulations thereunder;
B. the provisions of the Registration Statement of the Corporation
as the same may be amended from time to time, under the 1933 Act
and the 1940 Act;
C. the provisions of the Corporation's Articles of Incorporation, as
amended;
D. the provisions of the By-Laws of the Corporation, as amended; and
E. any other applicable provisions of state and federal law.
V. COMPENSATION
As compensation for providing services under this Agreement, the
Distributor shall receive and may retain any portion of any front-end or
contingent deferred sales charge which is imposed on sales and redemptions of
Shares and not reallowed to selected dealers as set forth in the Registration
Statement. Upon termination of this Agreement with respect to Shares of any Fund
or class for any reason, the obligation to pay and such contingent deferred
sales charge on Shares of such Fund or class sold prior to the date of
termination shall survive the termination, and the Corporation (or its agent)
shall collect and pay any such charges thereafter imposed on such Shares to the
Distributor. In addition, the Distributor shall receive from each class of each
Fund a distribution and/or service fee at the rate and under the terms and
conditions of the 12b-1 Plans, adopted by the Corporation with respect to such
classes of the Funds (which are attached hereto), as such 12b-1 Plans are in
effect from time to time, and subject to any further limitations on such fee as
the Board of Directors of the Corporation may impose.
Additional payments to the Distributor from the Corporation's
investment adviser, Transamerica Investments Services, Inc., or the
Corporation's administrator, Transamerica Occidental Life Insurance Company, may
be authorized in accordance with applicable law.
VI. EXPENSES
The expenses in connection with the distribution of the Funds shall be
allocable as follows:
A. EXPENSES OF THE DISTRIBUTOR
The Distributor shall pay:
1. the costs of printing and distributing prospectuses and
statements of additional information for prospective
investors and the costs of preparing, printing and
distributing such other sales literature, reports,
forms and advertisements in connection with the sale of
the Shares as comply with the applicable provisions of
federal and state law;
2. the costs of any additional copies of the Corporation's
financial and other reports and other literature supplied to
the Distributor for sales promotion purposes;
3. all advertising expenses incurred by the Distributor in
connection with the offering and sales of the Shares;
4. all compensation to the employees of the Distributor
and others for selling Shares, and all expenses of the
Distributor and others who engage in or support the
sale of Shares as may be incurred in connection with
their sales efforts;
5. expenses relating to the formulation and implementation
of marketing strategies and promotional activities such
as direct mail promotions and television, radio,
newspaper, magazine and other mass media advertising;
and
6. the costs of building and maintaining a database of
prospective shareholders and of obtaining such
analyses, reports and other information with respect to
marketing and promotional activities and investor
accounts as the Corporation may deem advisable.
B. EXPENSES OF THE CORPORATION
1. Each Fund, or class thereof, shall bear all expenses in
connection with preparing and typesetting the
Corporation's prospectuses, statements of additional
information, reports to shareholders, and other
materials, related to communications of such class or
Fund with existing shareholders.
VII. REPORTS
The Distributor shall prepare reports for the Board on a quarterly
basis showing such information concerning services provided and expenses
incurred related to this Agreement, and such other information, as from time to
time may be reasonably requested by the Board.
VIII. INDEMNIFICATION BY THE CORPORATION
The Corporation agrees to indemnify, defend and hold the Distributor,
each person who has been, is, or may hereafter be an officer, director, employee
or agent of the Distributor, and any person who controls the Distributor within
the meaning of Section 15 of the 1933 Act, free and harmless against any loss,
damage or expense reasonably incurred by any of them in connection with any
claim or in connection with any action, suit, or proceeding to which any of them
may be a party, which arises out of or is alleged to arise out of or is based
upon a violation of any of its covenants herein contained, or any alleged untrue
statement of a material fact, or the alleged omission to state a material fact
necessary to make the statements made not misleading, in the Registration
Statement or prospectus of the Corporation, or any amendment or supplement
thereto, unless such statement or omission was made in reliance upon written
information furnished by the Distributor. The foregoing rights of
indemnification shall be in addition to any other rights to which any of the
foregoing indemnified parties may be entitled as a matter of law. Nothing
contained herein shall relieve the Distributor of any liability to the
Corporation or its shareholders to which the Distributor would otherwise be
subject by reason of willful misfeasance, bad faith, or gross negligence in the
performance of its duties or reckless disregard of its obligations and duties
under this Agreement.
IX. INDEMNIFICATION BY THE DISTRIBUTOR
The Distributor agrees to indemnify, defend and hold the Corporation,
each person who has been, is, or may hereafter be an officer, director, employee
or agent of the Distributor, and any person who controls the Corporation within
the meaning of Section 15 of the 1933 Act, free and harmless against any loss,
damage or expense reasonably incurred by any of them in connection with any
claim or in connection with any action, suit, or proceeding to which any of them
may be a party, which arises out of or is alleged to arise out of or is based
upon a violation of any of its covenants herein contained, or any alleged untrue
statement of a material fact, or the alleged omission to state a material fact
necessary to make the statements made not misleading, on the part of the
Distributor or any agent or employee of the Distributor or any other person for
whose acts the Distributor is responsible or is alleged to be responsible (such
as any selected dealer or person through whom sales are made pursuant to an
agreement with the Distributor), whether made orally or in writing, unless such
statement or omission was made in reliance upon written information furnished by
the Corporation. The foregoing rights of indemnification shall be in addition to
any other rights to which any of the foregoing indemnified parties may be
entitled as a matter of law.
X. REPURCHASE OF SHARES
The Corporation appoints and designates the Distributor as agent of the
Corporation, and the Distributor accepts such appointment as such agent, to
repurchase shares of the Corporation in accordance with the provisions of the
articles and bylaws of the Corporation.
In connection with such redemptions or repurchases, the Corporation
authorizes and designates the Distributor to take any action, to make any
adjustments in net asset value, and to make any arrangements for the payment of
the redemption or repurchase price authorized or permitted to be taken or made
in accordance with the 1940 Act and as set forth in the Registration Statement.
The authority of the Distributor under this section may, with the
consent of the Corporation, be redelegated in whole or in part to another person
or firm.
The authority granted in this section may be suspended by the
Corporation at any time, or from time to time, until further notice to the
Distributor. After any such suspension the authority granted to the Distributor
by this section will be reinstated only by a written instrument executed by an
officer of the Corporation.
XI. DISTRIBUTOR IS INDEPENDENT CONTRACTOR
The Distributor is an independent contractor and shall be the agent for
the Corporation only with respect to the sale and redemption of Shares. The
Distributor is responsible for its own conduct, for the employment, control and
conduct of its agent and employees and for injury to such agents or employees or
to others through its agents or employees. The Distributor assumes full
responsibility for its agents and employees under applicable laws and agrees to
pay all employer taxes relating thereto.
XII. NON-EXCLUSIVITY
The services of the Distributor to the Corporation under this Agreement
are not to be deemed exclusive, and the Distributor shall be free to render
similar services to others (including other investment companies) so long as its
services to the Corporation are not impaired thereby. It is understood and
agreed that officers and directors of the Distributor may serve as officers or
directors of the Corporation, and that officers or directors of the Corporation
may serve as officers or directors of the Distributor to the extent permitted by
law. The officers and directors of the Distributor are not prohibited from
engaging in any other business activity or from rendering services to any other
person, or from serving as partners, officers, directors or trustees of any
other firm, corporation or trust, including other investment companies.
XIII. TERM
This Agreement shall become effective as of the later of: (i) the date
on which a Registration Statement becomes effective under the 1933 Act; and (ii)
the date on which this Agreement is executed, provided this Agreement is
approved by the vote of a majority of the Board and by the vote of a majority of
those members of the Board who are not parties to this Agreement or interested
persons of any such party, and who have no direct or indirect interest in the
operation of any 12b-1 Plan or this Agreement, cast in person at a meeting
called for the purpose of voting on such renewal.
Unless terminated as herein provided, this Agreement shall remain in
full force and effect for one year from the date of execution of this Agreement
and shall continue in effect from year to year thereafter, only so long as such
continuance is approved at least annually:
A. by the vote of a majority of those Directors of the
Corporation who are not parties to this Agreement or
interested persons of any such party, and who have no
direct or indirect interest in the operation of any
12b-1 Plan or this Agreement, cast in person at a
meeting called for the purpose of voting on such
renewal; and
B. by either the Board of the Corporation or the vote of a
majority of the outstanding voting securities of the
Corporation.
XIV. TERMINATION
This Agreement may be terminated as to any class of any Fund at any
time, without the payment of any penalty, by the vote of a majority of the
Directors of the Corporation who are not interested persons of the Corporation
and who have no direct or indirect financial interest in the operation of any
12b-1 Plan or this Agreement, or by the vote of a majority of the outstanding
voting securities of the class of the Fund, on sixty (60) days' written notice
to the Distributor, or by the Distributor at any time without the payment of any
penalty, on sixty (60) days' written notice to the Corporation.
XV. ASSIGNMENT
This Distribution Agreement may not be assigned by the Distributor and
will automatically and immediately terminate in the event of its assignment.
XVI. AMENDMENTS
This Agreement may be amended at any time or from time to time by an
instrument in writing, signed by a duly authorized officer of the Corporation
and by the Distributor, but no amendment to this Agreement shall be effective
until such amendment is approved:
A. by the vote of a majority of those Directors of the Corporation
who are not parties to this Agreement or interested persons of
any such party and who have no direct or indirect financial
interest in the operation of any 12b-1 Plan or this Agreement,
cast in person at a meeting called for the purpose of voting on
such approval; and
B. by the vote of a majority of the Board of Directors of the
Corporation;
provided, however, that amendments relating to any 12b-1 Plan shall not require
the consent of the Distributor.
XVII. GOVERNING LAW
This Agreement shall be governed by the laws of the State of Maryland,
without regard to conflicts of law principles; provided, however, that nothing
herein shall be construed as being inconsistent with the 1940 Act.
XVIII. DEFINITIONS
As used in this Agreement, the terms "majority of outstanding voting
securities," "interested persons," and "assignment" shall have the same meaning
as those terms have in the 1940 Act.
XIX. NOTICE
Any notice, advice or report to be given pursuant to this Agreement
shall be deemed sufficient if delivered by hand, transmitted by electronic
facsimile, or mailed by registered, certified or overnight United States mail,
postage prepaid, or sent by overnight delivery with a recognized courier,
addressed by the party giving notice to the other party at the last address
furnished by the other party:
To the Distributor at: Transamerica Securities Sales Corporation
0000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxx Xxxx
To the Corporation at: Transamerica Investors, Inc.
0000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attn: Corporate Secretary
Each such notice, advice or report shall be effective upon receipt or
three days after mailing, whichever is first.
XX. SEVERABILITY
If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby.
XXI. ENTIRE AGREEMENT
This Agreement embodies the entire agreement and understanding between
the parties hereto, and supersedes all prior agreements and understandings
relating to this Agreement's subject matter. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an original, but
such counterparts shall, together, constitute only one instrument.
XXII. 1940 ACT
Where the effect of a requirement of the 1940 Act reflected in any
provision of this Agreement is altered by a rule, regulation or order of the
Commission, whether of special or general application, such provision shall be
deemed to incorporate the effect of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the day and year first written
above.
TRANSAMERICA INVESTORS, INC.
Attest: _________________________ By:
Title:
TRANSAMERICA SECURITIES SALES
CORPORATION
Attest: __________________________ By: _______________________________
Title:
