EXHIBIT NO. 99.7(d)
AMENDMENT NO. 2 TO CUSTODIAN AGREEMENT
This Amendment No. 2 ("Amendment") to the Custodian Agreement is made
as of May 2, 2003 by and among each of the business trusts listed on Schedule A
hereto (each, a "Trust"), State Street Bank and Trust Company (the "Custodian")
and MFS Service Center, Inc., a Delaware corporation (the "Transfer Agent").
Capitalized terms used in this Amendment without definition shall have the
respective meanings given to such terms in the Custodian Agreement referred to
below.
WHEREAS, each Trust and the Custodian entered into a Custodian
Agreement dated as of July 2, 2001 (as amended and in effect from time to time,
the "Agreement"); and
WHEREAS, certain Portfolios of the Trusts (the "Master/Fund of Fund
Portfolios") will primarily invest in shares of one or more other Portfolios
listed on Exhibit A of the Agreement, pursuant to applicable exemptions from the
provisions of Section 12(d) of the 1940 Act;
WHEREAS, the Master/Fund of Fund Portfolios desire to use the Transfer
Agent as the functional equivalent of a securities depositary for their
investments in such other Portfolios, and to have their interest in those other
Portfolios' shares recorded by book entry on the Transfer Agent's records;
WHEREAS, the staff of the SEC, through a series of no-action letters,
has established conditions under which the Master/Fund of Fund Portfolios'
interest in those other Portfolios' shares may be maintained on the Transfer
Agent's books, as set forth in Addendum 1 hereto; and
WHEREAS, the parties hereto desire to amend the Agreement to
accommodate these arrangements and any similar arrangements entered into in the
future by the Portfolios;
NOW THEREFORE, in consideration of the foregoing and the mutual
covenants agreements hereinafter contained, the parties hereby agree to amend
the Agreement, pursuant to the terms thereof, as follows:
1. Section 2. Employment of Custodian and Property to be Held by It.
Section 2 of the Agreement is hereby amended by adding the following
sentence to the end of the first paragraph:
"With respect to uncertificated shares (the "Underlying Shares") of
registered investment companies, the maintenance of Custodian records
that identify the Underlying Shares as being recorded in the
Custodian's
name on behalf of the Portfolios will be deemed custody for purposes
hereof."
2. Section 3. Duties of the Custodian with Respect to Property of the Trusts
held by the Custodian in the United States.
Section 3 of the Agreement is hereby amended by adding the following
provision:
"Section 3.9A Deposit of Fund Assets with the Transfer Agent.
Underlying Shares of another Portfolio ("Underlying Portfolio
Shares") may be deposited and/or maintained in an account or accounts
maintained with the Transfer Agent. The Transfer Agent shall be
deemed to be acting as if it is a "securities depository" for
purposes of Rule 17f-4 under the 1940 Act. The Trust hereby directs
the Custodian to deposit and/or maintain such securities with the
Transfer Agent, subject to the following provisions:
1) The Custodian shall keep Underlying Portfolio Shares owned by
a Portfolio with the Transfer Agent provided that such
securities are maintained in a separate account or accounts on
the books and records of the Transfer Agent in the name of the
Custodian as custodian for the Portfolio.
2) The records of the Custodian with respect to the Underlying
Portfolio Shares which are maintained with the Transfer Agent
shall identify by book-entry those Underlying Portfolio Shares
belonging to a Portfolio.
3) The Custodian shall pay for Underlying Portfolio Shares
purchased for the account of a Portfolio upon (i) a
determination by the Custodian that such Underlying Portfolio
Shares have been purchased and will be transferred to the
account of the Custodian, on behalf of the Portfolio, on the
books and records of the Transfer Agent, and (ii) the making
of an entry on the records of the Custodian to reflect such
payment and transfer for the account of the Portfolio. The
Trust acknowledges that the Custodian will only pay for
Underlying Portfolio Shares under this Section on the basis of
standing or periodic Proper Instructions. The Custodian shall
receive confirmation from the Transfer Agent of the purchase
of such securities and the transfer of such securities to the
Custodian's account with the Transfer Agent only after such
payment is made. The Custodian shall transfer Underlying
Portfolio Shares redeemed for the account of a Portfolio (i)
upon a determination by the Custodian that such securities
have been redeemed and that payment for such
securities will be transferred to the Custodian, and (ii)
the making of an entry on the records of the Custodian to
reflect such transfer and payment for the account of the
Portfolio. The Custodian will receive confirmation from the
Transfer Agent of the redemption of such securities and
payment therefore only after such securities are redeemed.
Copies of all trade summary sheets from the Custodian
reflecting purchases and sales of Underlying Portfolio
Shares for the account of a Portfolio shall identify the
Portfolio, be maintained for the Portfolio by the Custodian,
and shall be provided upon request to the Trust on behalf of
the Portfolio, together with any daily or other periodic
transaction sheets reflecting each day's transactions for a
Portfolio as reflected on the books and records of the
Transfer Agent. The Custodian shall deliver to the Trust
such reports on its system of internal accounting controls
as the Trust may from time to time request.
4) The Custodian shall not be liable to the Trust or any Portfolio
for any loss or damage to the Trust or any Portfolio resulting
from maintenance of Underlying Portfolio Shares with the
Transfer Agent except for losses resulting directly from the
negligence, misfeasance or misconduct of the Custodian or any of
its agents or of any of its or their employees.
5) The Trust, on behalf of the Portfolio, the Transfer Agent and
the Custodian shall comply with the applicable conditions set
forth in Addendum 1 hereto, so long as those conditions are
required to be complied with by the SEC or the staff of the
SEC."
3. Continuing Agreement.
Except as expressly amended by the Amendment No. 2 to Custodian
Agreement, the provisions of the Agreement shall remain in full force and
effect.
4. Addition of Portfolios to Schedule A
Schedule A of this Amendment listing the Master/Fund of Fund Portfolios
may be amended from time to time in the manner provided in section 15(a) of the
Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No. 2 to Custodian Agreement to be executed in its name and behalf by
its duly authorized representative(s) as of the date first written above.
EACH OF THE ENTITIES SET FORTH ON SCHEDULE A TO THE AMENDMENT
By: XXXXX X. XXXXXXXXX, XX.
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Name: Xxxxx X. Xxxxxxxxx, Xx.
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Title: Assistant Secretary and Assistant Clerk
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STATE STREET BANK AND TRUST COMPANY
By: ____________________________
Name: ____________________________
Title: ____________________________
MFS SERVICE CENTER, INC.
By: XXXXX X. XXXXXXXX
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Name: Xxxxx X. Xxxxxxxx
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Title: President
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Schedule A to Amendment
MFS Series Trust IX, on behalf of its series:
MFS Research Bond Fund J
MFS Series Trust X, on behalf of its series:
MFS Conservative Allocation Fund
MFS Moderate Allocation Fund
MFS Growth Allocation Fund
MFS Aggressive Growth Allocation Fund
Addendum 1
Conditions Required by Staff of SEC
Portfolio Conditions
1. The Portfolio must maintain a system that is reasonably designed to
prevent unauthorized officers' instructions and which will provide, at
least, for the form, content, and means of giving, recording and
reviewing the instructions.
2. The Board of Trustees overseeing the Portfolio must approve the
arrangement with the Transfer Agent and review it as appropriate.
3. The number of persons authorized to transmit instructions by or on
behalf of the Portfolio to the Transfer Agent must be limited (e.g., to
5).
4. Persons transmitting instructions by or on behalf of the Portfolio to
the Transfer Agent must use passwords to insure that they are properly
authorized.
5. Internal accounting controls by or on behalf of the Portfolio must be
employed that subject all transaction sheets reflecting purchase,
redemption or exchange activity by the Portfolio and maintained by the
Transfer Agent to daily proof against the Portfolio's transaction
authorizations.
6. The Portfolio's independent accountants must perform at least three
verifications of the Portfolio's investments, at least two of which
must be performed without prior notice to the Portfolio.
Transfer Agent Conditions
7. The Transfer Agent must transmit daily transaction sheets reflecting
purchase, redemption or exchange activity by the Portfolio to someone
at the Portfolio or someone acting on the Portfolio's behalf who is not
the same person who transmitted the instruction to the Transfer Agent.
8. The Transfer Agent must maintain segregated accounts representing any
assets held for the Custodian.
Custodian Conditions
9. The Custodian must maintain the Portfolio's securities (i.e.,
investment in Underlying Shares) directly with the Transfer Agent in a
separate account in its name.
10. The Custodian must send to the Portfolio or someone acting on behalf of
the Portfolio copies of all transaction sheets reflecting purchase,
redemption or exchange activity by the Portfolio received from the
Transfer Agent of any transfer to or from the account of the Portfolio.
11. The Custodian must send to the Portfolio or someone acting on behalf of
the Portfolio reports regarding the Custodian's system of internal
accounting control as the Portfolio or someone acting on behalf of the
Portfolio may reasonably request from time to time.
