DELEGATION AGREEMENT


     AGREEMENT,  dated as of August 12,  2005 by and  between  INVESTORS  BANK &
TRUST COMPANY, a Massachusetts trust company (the "Delegate"),  and MGI FUNDS, a
Delaware statutory trust (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  Trustees  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 Trustees of
the Fund desires to retain the Delegate to provide certain  services  concerning
Foreign Assets on behalf of certain series of the Fund (the  "Portfolios"),  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 Trustees (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)(6).

     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 U.S.  Bank  chartered  as a  trust
     company  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
     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  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

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