EXHIBIT NO. 99.8(b)
MASTER ADMINISTRATIVE SERVICES AGREEMENT
MASTER ADMINISTRATIVE SERVICES AGREEMENT initially dated the 1st day of March,
1997, and as amended and restated on this 1st day of August, 2006, by and among
Massachusetts Financial Services Company, a Delaware corporation (the
"Administrator"), and each of the funds (or trusts acting on behalf of their
series) identified from time to time on Exhibit A hereto (each a "Fund" and
collectively the "Funds").
W I T N E S S E T H:
WHEREAS, the Funds have entered into Investment Advisory Agreements with the
Administrator (the "Advisory Agreements") pursuant to which the Administrator
provides investment advisory services to the Funds;
WHEREAS, the Funds desire to retain the Administrator to render the legal,
financial administration and other administrative services required by the
Funds in the manner and on the terms and conditions hereinafter set forth;
NOW THEREFORE, in consideration of the mutual covenants and agreements of the
parties hereto and hereinafter set forth, the parties covenant and agree as
follows:
1. ADMINISTRATIVE SERVICES. The Administrator shall, at its expense (subject to
Sections 2 and 3 hereof), and subject always to the control of the trustees,
directors or other governing body of the Funds (referred to herein as
"Trustees"), manage, supervise and conduct all of the day-to-day and ordinary
course non-investment related affairs and business of the Funds and matters
incidental thereto not required to be provided by the Administrator under the
Advisory Agreements (together "Administrative Services"). Exhibit B hereto
lists various categories of Administrative Services to be provided by the
Administrator hereunder, it being understood that such list is not exhaustive
and that the Funds may require Administrative Services in addition to those
specified or referenced in Exhibit B. If there occurs a material change in the
laws, rules or regulations governing the Funds or related Fund policies that
materially increase or decrease the types or quantities of Administrative
Services required by the Funds, the Funds and the Administrator shall negotiate
in good faith an adjustment to the Administrative Fee payable under Section 5
hereof. In the performance of its duties, the Administrator will comply with
the provisions of the Declaration of Trust and Bylaws of each Fund and
applicable law, and shall comply with such compliance and other policies and
procedures as the Trustees may adopt, approve or determine from time to time.
2. RESPONSIBILITY FOR CHARGES AND EXPENSES. During the term of this Agreement,
the Administrator will pay all expenses incurred by it in connection with its
obligations under this Agreement, except such expenses as are assumed by the
Funds under this Agreement and any expenses that are paid by the Funds or by a
party other than the Funds on behalf of the Funds under the terms of any other
agreement to which the Funds are a party or a third-party beneficiary. The
Administrator further agrees to pay or cause its affiliates to pay all
salaries, fees, and expenses of any officer or Trustee of the Funds who is an
officer, director, or employee of the Administrator or an affiliate of the
Administrator. The Administrator assumes and shall pay for maintaining its
staff and personnel and shall, at its own expense, provide the equipment,
office space, and facilities necessary to perform its obligations under this
Agreement. The Administrator shall not, under the terms of this Agreement, bear
the categories of expenses listed on Exhibit C hereto (although the
Administrator or an affiliate may bear certain of these expenses under one or
more other agreements).
3. ADMINISTRATIVE SERVICES PROVIDED BY THIRD Parties. It is acknowledged and
agreed that the Funds will require and bear the costs of administrative
services to be provided by third parties in addition to Administrative Services
which the Administrator is required to provide or procure at its own expense
under this Agreement, such as legal services to be provided by legal counsel to
the Funds and the Trustees who are not "interested persons" (as defined in the
Investment Company Act of 1940) of the Funds ("Independent Trustees"), and
services to be provided to the Funds by independent accountants or other
auditors or consultants which would otherwise constitute Administrative
Services ("Separate Third Party Services"). It is further acknowledged and
agreed that, from time to time, due to resource constraints or otherwise, the
Administrator may cause or arrange for third parties to provide Administrative
Services that the Administrator is required to provide or procure at its own
expense under this Agreement (e.g., the use of outside legal counsel to draft
routine Fund proxy statements or prospectuses) ("Outsourced Third Party
Services"). Subject to any policies or procedures that are adopted by the
Funds, the Administrator shall pay for the costs of any Outsourced Third Party
Service unless it obtains the approval of the Trustees (or a committee or other
delegate of the Trustees) for the Funds to bear some or all of such costs prior
to causing or arranging for the Outsourced Third Party Service to be provided
to the Funds. The parties recognize that there may be circumstances in which it
is unclear as to whether a particular administrative service provided by a
third party constitutes a Separate Third Party Service or an Outsourced Third
Party Service. Subject to any policies or procedures that are adopted by the
Funds, the Administrator shall use its best efforts to identify and bring such
circumstances to the attention of the Trustees, in which case the Trustees
shall, in good faith, determine whether the particular service constitutes a
Separate Third Party Service or an Outsourced Third Party Service for purposes
of this Agreement. (1)
----------
(1) The Funds/Trustees and the Administrator may from time to time develop
written policies designed to delineate various administrative services and
responsibilities to be provided by third party service providers to the
Funds or the Independent Trustees (for which the Funds bear the associated
expenses), on the one hand, and those to be provided by the Administrator
at is own expense, on the other, as well as procedures to be followed by
the Administrator in utilizing third party service providers on behalf of
the Funds.
4. MAINTENANCE OF BOOKS AND RECORDS. With respect to the provision of
Administrative Services, the Administrator will preserve for each Fund that is
registered as an investment company with the Securities and Exchange Commission
(the "SEC") all records required to be maintained as prescribed by the rules
and regulations of the SEC in the manner and for the time periods prescribed by
such rules. The Administrator agrees that all such records shall be the
property and under the control of each Fund for which they are maintained and
shall be made available, within five business days of any request therefore, to
the Fund's Trustees or independent accountants during regular business hours at
the Administrator's offices. In the event of termination of this Agreement for
any reason, all such records shall be returned, without charge, promptly to the
appropriate Fund, free from any claim or retention of rights by the
Administrator, except that the Administrator may retain copies of such records.
5. ADMINISTRATIVE FEE. Each Fund shall pay the Administrator a fee as agreed to
from time to time and as set forth in Exhibit D hereto (the "Administrative
Fee"). The Administrative Fee shall be accrued for each calendar day and the
sum of the daily fee accruals shall be paid monthly to the Administrator on the
second to last business day of each calendar month. If this Agreement becomes
effective or terminates before the end of any calendar month, the
Administrative Fee for the period from the effective date to the end of such
calendar month or from the beginning of such calendar month to the date of
termination, as the case may be, shall be prorated according to the proportion
which such period bears to the full month in which such effectiveness or
termination occurs.
6. NON-EXCLUSIVITY. The services of the Administrator to the Funds hereunder
are not to be deemed exclusive and the Administrator shall be free to render
similar services to others.
7. STANDARD OF CARE. Neither the Administrator, nor any of its directors,
officers, stockholders, agents or employees, shall be liable or responsible to
any Fund or its shareholders for any error of judgment, mistake of law or any
loss arising out of any act or omission in the performance by the Administrator
of its duties under this Agreement, except for liability resulting from (a)
willful misfeasance, (b) bad faith, (c) gross negligence, or (d) reckless
disregard by the Administrator of its obligations and duties under this
Agreement.
8. TERM, TERMINATION, AMENDMENT AND ASSIGNMENT. This Agreement shall begin on
the date first written above and shall continue indefinitely with respect to
each Fund until terminated as follows:
(i) the Agreement may be terminated at any time, without payment of
any penalty, by the Trustees of the Fund upon sixty (60) days' written notice
to the Administrator;
(ii) the Agreement may be terminated by the Administrator with respect
to any Fund at any time upon sixty (60) days' written notice to the Fund; and
(iii) if the Trustees of the Fund, including a majority of the
Independent Trustees, do not specifically approve at least annually the
continuance of this Agreement, then this Agreement shall automatically
terminate at the close of business on the anniversary of its execution, or upon
the expiration of one year from the effective date of the last such
continuance, whichever is later.
This Agreement may be amended at any time by a written agreement
executed by each party hereto and may be assigned with respect to any Fund only
with the written consent of the Fund and the Administrator.
9. MISCELLANEOUS.
a. CAPTIONS. The captions in this Agreement are included for
convenience of reference only and in no way define or delineate any
of the provisions hereof or otherwise affect their construction or
effect.
b. GOVERNING LAW. The provisions of this Agreement shall be construed
and interpreted in accordance with the domestic substantive laws of
The Commonwealth of Massachusetts, without giving effect to any
conflicts or choice of laws rule or provision that would result in
the application of the domestic substantive laws of any other
jurisdiction.
c. COUNTERPARTS. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same
instrument.
d. JOINDER OF FUNDS. In the event that additional funds are created
from time to time which desire to retain the Administrator to
provide them with Administrative Services pursuant to this
Agreement, the Administrator and the additional fund may jointly
amend Schedule A hereto to add the additional ----------- fund, and
the additional fund shall thereafter be deemed a "Fund" for all
purposes of this Agreement. The consent of the other parties to
this Agreement shall not be required to amend Schedule --------- A
hereto.
e. SCOPE OF FUND'S OBLIGATIONS. A copy of the Declaration of Trust of
each Fund (or trust of which the Fund is a series) organized as a
Massachusetts business trust (each a "Trust"), is on file with the
Secretary of State of The Commonwealth of Massachusetts. The
Administrator acknowledges that the obligations of or arising out
of this Agreement are not binding upon any of a Trust's Trustees,
officers, employees, agents or shareholders individually, but are
binding solely upon the assets and property of the Trust in
accordance with its proportionate interest thereunder and
hereunder. If this Agreement is executed by a Trust on behalf of
one or more series of the Trust, the Administrator further
acknowledges that the assets and liabilities of each series of the
Trust are separate and distinct and that the obligations of or
arising out of this Agreement are binding solely upon the assets or
property of the series on whose behalf the Trust has executed this
Agreement. The Administrator also agrees that the obligations of
each Fund hereunder shall be several and not joint nor joint and
several, in accordance with its proportionate interest hereunder,
and agrees not to proceed (by way of claim, set-off or otherwise)
against any Fund for the obligations of another Fund.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed
by their respective officers thereunto duly authorized and their respective
corporate seals to be hereunto affiliated, as of the date first written above.
On behalf of the MFS/Sun Life Series Trust
and
Compass Products listed on Exhibit A hereto
By: J. XXXXXX XXXXXXXXXX
-------------------------------
J. Xxxxxx Xxxxxxxxxx
Chairman of the Board of Trustees/Managers
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By: XXXXXX X. XXXXX
-------------------------------
Xxxxxx X. Xxxxx
Chairman
As of __________, 2006
MASTER ADMINISTRATIVE SERVICES AGREEMENT - EXHIBIT A
FUNDS
MFS Sun Life Series Trust:
MFS Sun Life Series Trust:
Bond Series
Capital Appreciation Series
Capital Opportunities Series
Core Equity Series
Emerging Growth Series
Emerging Markets Equity Series
Global Governments Series
Global Growth Series
Global Total Return Series
Government Securities Series
High Yield Series
International Growth Series
International Value Series
Massachusetts Investors Growth Stock Series
Massachusetts Investors Trust Series
Mid Cap Growth Series
Mid Cap Value Series
Money Market Series
New Discovery Series
Research International Series
Research Series
Strategic Growth Series
Strategic Income Series
Strategic Value Series
Technology Series
Total Return Series
Utilities Series
Value Series
Compass Products
Capital Appreciation Variable Account
Global Governments Variable Account
Government Securities Variable Account
High Yield Variable Account
Money Market Variable Account
Total Return Variable Account
EXHIBIT B
ADMINISTRATION SERVICES
I. FINANCIAL ADMINISTRATIVE SERVICES.
A. GENERAL SERVICES.
1. Prepare such financial information of the Fund as is reasonably
necessary for reports to shareholders of the Fund, reports to the
Fund's Trustees and officers, and reports to appropriate regulatory
authorities including, without limitation, prospectuses,
shareholder reports, shareholder notices, proxy statements and
other periodic reports and render statements or copies of records
as from time to time are reasonably requested by the Fund.
2. Facilitate audits of accounts by the Fund's independent public
accountants or by any of the auditors employed or engaged by the
Fund or by any regulatory body with jurisdiction over the Fund.
Coordinate with, and monitor the performance of, the custodian
banks retained by the Fund to perform the necessary custodial
services for the Fund including, without limitation, the
safekeeping of the funds and securities.
3. Negotiate contracts for computing the Fund's net asset value per
share, and, if applicable, its public offering price and/or its
daily dividend rates and money market yields and other investment
performance quotations, in accordance with sub-paragraph C below,
and oversee the notification to the Fund and such other persons as
the Fund may reasonably request of the net asset value per share,
the public offering price and/or its daily dividend rates and money
market yields and other investment performance quotations (with the
expenses under such contracts to be paid separately by the Funds).
B. VALUATION OF SECURITIES. The Administrator shall ensure that the
value of the Fund's securities is computed in accordance with
governing law, rules and regulations, the Fund's governing instruments
and subject to the oversight and direction of the Fund's Trustees. The
Administrator shall oversee the use of one or more external pricing
services (at the separate expense of the Funds) to provide the value
of a Fund's securities, including broker/dealers, provided that the
Fund's Trustees or a committee or an individual designated by the
Fund's Trustees has approved the use of such pricing services.
The Administrator shall administer the Valuation Policies approved by
the Trustees for the Fund, including the implementation and
application of fair valuation methods and security valuation factors
for applicable securities and other assets, including those provided
by third-party service providers at the expense of the Funds, and
provide such reports to the Fund's Trustees or a committee thereof as
is required by such Policies or otherwise requested.
C. COMPUTATION OF NET ASSET VALUE, PUBLIC OFFERING PRICE, DAILY
DIVIDEND RATES AND PERFORMANCE QUOTATIONS. The Administrator shall
assure that the Fund's net asset value, net income, public offering
price, dividend rates and money market yields, if applicable, and
other investment performance quotations are calculated in a manner and
at such time or times as the Fund shall direct and in accordance with
governing law, rules and regulations and the Fund's governing
instruments and subject to the oversight and direction of the Fund's
Trustees. The Administrator will oversee the computation of the net
asset value and public offering price as calculated by service
providers of the Funds.
D. OTHER FINANCIAL ADMINISTRATION SERVICES.
1. Provide Treasurers or Assistant Treasurers to serve as officers of
the Fund;
2. Coordinate the meetings of the Audit Committees of the Fund,
assure that meetings are scheduled and that agendas are prepared;
participate in meetings of the Audit Committee;
3. Review contracts and negotiate fees for the Fund for services such
as independent audit fees, custodian fees, bank lines of credit,
transfer agent fees and the fees of other service providers to the
Fund;
4. Oversee the preparation of accounting records by service providers
of the Fund required to be maintained by the Fund. Assure that any
audit of Fund records is coordinated and completed timely;
5. Direct the preparation of Fund Financial Statements and Footnotes
included in shareholder and other regulatory reports. Assure that
all statements and disclosures are in accordance with generally
accepted accounting principles and that disclosures meet current
regulatory or accounting requirements. Establish and maintain
disclosure controls and internal controls over financial reporting
to assist in the Funds' officers certification under the
Xxxxxxxx-Xxxxx Act of 2002;
6. Calculate and/or oversee the calculation of income and capital
gain distributions for applicable funds. Assure that all
distributions of the Fund meet the distribution and excise tax
requirements to assure qualification and to minimize taxes paid by
the Fund;
7. Establish the tax policies and procedures for the Fund; maintain
procedures and policies with respect to tax matters; maintain or
oversee the maintenance of certain tax accounting records of the
Fund; complete or review tax returns and excise tax forms for the
Fund; assist in preparing the 1099-DIV information delivered to
shareholders;
8. Prepare materials for the Trustees of the Fund and committees
thereof, including materials for board meetings and in connection
with the renewal of investment advisory and distribution
contracts;
9. Direct the accrual of Fund expenses; review and approve all
invoices submitted to the Fund;
10. Calculate total return and other performance information for each
Fund and its respective classes;
11. Prepare and file or oversee preparation and review the Funds'
annual and semi-annual N-CSR and other periodic reports; and
12. Administer the Funds' securities lending program.
II. LEGAL ADMINISTRATIVE SERVICES.
A. ORGANIZATIONAL MATTERS AND INITIAL REGISTRATION.
1. Draft, negotiate as appropriate, and file with appropriate
regulatory authorities the Fund's charter documents, service
contracts, and registration statement or other similar registration
documentation (the "Registration Statement"), except that the
out-of-pocket expenses incurred in connection therewith shall be
paid by the Funds;
2. Otherwise arrange for and oversee registration and qualification of
the Fund's shares, except that the out-of-pocket expenses incurred
in connection therewith shall be paid by the Funds.
B. ONGOING REGULATORY FILINGS, REPORTS AND MEETINGS.
1. Prepare and file with appropriate regulatory authorities amendments
to the Fund's Registration Statement, and supplements to the Fund's
prospectus and statement of additional information;
2. Design and draft documents or materials required to be prepared by
or on behalf of the Fund for distribution to shareholders of the
Fund, the Fund's Trustees and officers and any governmental
officers or commissions as required of the Fund including, without
limitation, prospectuses, shareholder reports, shareholder notices
and proxy statements;
3. Prepare and file or oversee preparation and review and provide
legal guidance on the Fund's annual, semi-annual and other periodic
reports and tax filings and reports;
4. Establish and maintain a disclosure controls and procedures program
to assist in the Funds' officers certification under the
Xxxxxxxx-Xxxxx Act of 2002;
5. Develop or assist in developing guidelines and procedures to
improve overall compliance by the Funds;
6. Provide consultation and advice for resolving compliance questions
together with the Funds' outside legal counsel;
7. Prepare and file with appropriate regulatory authorities various
reports in order to maintain the Fund's status in good standing;
8. Arrange for and attend shareholders' meetings;
9. Prepare the Fund's representatives who will attend shareholder
meetings and all necessary materials in connection with such
meetings including, without limitation, a written script for such
meetings, minutes and any follow-up documents.
C. SECURITIES TRADING AND INVESTMENT PRACTICES.
1. Review and negotiate private placement and municipal securities
offering documentation and provide legal guidance on transfer
restrictions;
2. Provide guidance on legal considerations relating to the types and
levels of ownership of securities, including foreign securities;
3. Draft and negotiate documentation necessary to permit the Fund to
engage in a variety of derivative and securities trading practices
and provide legal guidance with respect to these practices.
D. REGULATED ACTIVITIES. Applicable securities laws regulate numerous
aspects of the Fund's business, including such matters as the Fund's:
prospectus disclosure; investment activities; affiliated transactions;
investment in senior securities; sales, redemptions and exchanges;
distribution of income and capital gains; distribution of Fund shares;
board composition; code of ethics; fidelity bond; custodial services;
and investment advisory and distribution contracts. The Administrator
will provide the Fund with legal guidance with respect to these
matters and to the general application of securities laws to the
Fund's business.
E. TAX CONSIDERATIONS. Procure legal guidance with respect to the
application of tax rules to the Fund and analysis from a tax
perspective new types of securities, investment practices and
investment products or practices as may be appropriate for the Fund
(it being understood that such legal guidance and analysis provided by
third-parties will be at the expense of the Fund).
F. BOARD MATTERS.
1. Coordinate and prepare agendas and materials for and attend board
and committee meetings, draft and keep records of minutes of such
meetings, and coordinate any follow up issues; and
2. Provide advice and guidance and prepare materials on legal issues
relevant to the Fund's business, including composition of the
governing board.
G. MISCELLANEOUS/EXTRAORDINARY EVENTS.
1. Supervise outside legal counsel retained at the expense of the Fund
with respect to litigation brought by the Fund and against the Fund
and negotiate litigation settlements and pre-litigation settlements
and work-out arrangements;
2. Obtain the required documentation to be filed in connection with
any lawsuits against the Fund and provide information or expertise
on administrative matters affecting such litigation;
3. Provide legal guidance on alternative distribution structures for
the Fund's shares (such as the adoption of a multiple class
structure);
4. Review all contracts concerning the acquisition of other investment
companies or the liquidation of the Fund, draft, negotiate and file
various documentation required in connection therewith, provide
guidance on the manner such transactions should be structured to
comply with applicable law and obtain at the Fund's expense legal
opinions and regulatory authority rulings necessary for such
transactions to comply with applicable law;
5. Seek formal guidance from regulatory authorities concerning the
application of various regulations to the Fund and seek exemptive
relief where appropriate; and
6. Provide or arrange for all other legal services that constitute
Administrative Services required by the Fund and not otherwise
provided for under this Agreement (it being understood that various
legal services will be provided to the Fund and the Independent
Trustees at the expense of the Funds, as described in Section 3 of
the Agreement).
III. OTHER ADMINISTRATIVE SERVICES.
1. Arrange for persons or other entities to serve as transfer agent,
registrar or dividend disbursing agent as required by the Fund,
and provide legal guidance on applicable laws regulating such
agents;
2. Arrange for consideration by the Board of appropriate or necessary
insurance coverage for the Fund;
3. Develop and implement procedures to monitor each Fund's compliance
with:
o Regulatory requirements as required by Rule 38a-1 of the
Investment Company Act of 1940, as amended;
o Each Fund's investment policies and restrictions as set forth in
each Fund's currently effective Prospectus and Statement of
Additional Information filed under the Securities Act of 1933,
as amended;
o Establishing and maintaining an anti-money laundering program to
assist in the Funds' compliance with the USA Patriot Act and the
Bank Secrecy Act;
o Performing IRS sub-Chapter M testing;
o Reviewing and filing with the NASD semi-annual and annual
reports;
o Assisting in training of certain MFS personnel including
Portfolio Managers and other investment staff;
o Monitoring "Access Persons" transactions and their adherence
under the terms of the Funds' Code of Ethics Policy;
o Providing assistance and resources to the Funds' Independent
Chief Compliance Officer ("ICCO") as requested by the ICCO.
4. Prepare, and arrange for the printing and mailing of, any
necessary investment communications;
5. Arrange for the printing and mailing of any documents or written
materials required to be prepared by or on behalf of the Fund
including, without limitation, stock certificates, prospectuses,
shareholder reports, shareholder notices, proxy statements and
reports to governmental officers and commissions;
6. Arrange for any other printing, production and delivery services
required of the Fund and not otherwise specifically provided for
under this Agreement;
7. Provide a system of internal controls adequate to carry-out the
business of the Fund and arrange for the annual report on internal
controls of the Fund and its agents;
8. Review the Fund's disclosure documents to ensure that disclosures
and policies conform to the Fund's actual operation;
9. Provide for the calculation and timely disbursement of appropriate
regulatory authority registration fees; and
10. Oversee and assist in the coordination of, and as the Trustees may
reasonably request or deem appropriate, make reports and
recommendations to the Trustees on, the performance of
administrative and professional services rendered to the Fund by
others, including the custodian, accountants, attorneys,
underwriters, brokers and dealers, insurers, banks, transfer
agents and dividend disbursing agents and such other persons in
any such other capacity deemed necessary or desirable by the
Trustees.
EXHIBIT C
CATEGORIES OF NON-ADMINISTRATOR EXPENSES
a. The fees and expenses described in Article 2(b) or Section 2.2(b) of the MFS
Family of Funds' Advisory Agreements and Article 5 of the MFS/Sun Life
Series Trust and Compass Product's Advisory Agreements.
b. Investment advisory fees and other expenses associated with the investment
management of the Funds' portfolios.
c. Costs of brokerage fees, commissions, ticket charges and transfer taxes in
connection with the purchase and sale of portfolio securities and other
assets for the Funds.
d. Distribution and marketing expenses of the Funds, including Rule 12b-1 fees.
e. Expenses of the Funds for transfer agent(s), registrar(s) and dividend
disbursing agent(s).
f. Expenses of the Funds for custodian(s) and related custodial services.
g. Except as described in Section 3 of the Agreement, costs of Fund accounting
services provided by third parties to the Funds, including the fund
accounting services of the type currently provided by State Street Bank to
the MFS Funds.
h. Except as described in Section 3 of the Agreement, costs of services
provided by independent accountants and outside legal and tax counsel to the
Funds and the Independent Trustees.
i. Taxes, if any, levied against the Funds.
j. Costs, including interest expenses, commitment fees, facilities fees and
unused line fees of any borrowings made by the Funds.
k. The Funds' allocable portion of the fidelity bond required by Section 17(g)
of the Investment Company Act of 1940, and directors' and officers'
liability and other insurance premiums.
l. Proxy filing fees and the costs of printing and mailing of any proxy
materials for meetings of shareholders' of the Funds.
m. All applicable registration and filing fees required to be paid by the Funds
under federal and state securities laws.
n. The Funds' allocable portion of expenses of obtaining quotations and other
pricing information for calculating the value of the Fund's net assets,
including the costs of independent pricing services.
o. Fees, expenses and other compensation of or payable by the Funds to
Independent Trustees, including expenses to maintain the Independent
Trustees' retirement plan, including actuarial services provided by Xxxxxx
Xxxxx Worldwide.
p. Printing, mailing and filing costs associated with the preparation and
distribution of registration statements, prospectuses and reports of the
Fund to its shareholders, the filing of reports with regulatory bodies, the
maintenance of the Trust's existence and qualification to do business, and
the registration of shares with federal and state securities authorities.
q. Extraordinary expenses as may arise, including judgments and expenses
incurred in connection with litigation, bankruptcies, workouts and
restructurings, proceedings and other claims against the Funds, and the
legal obligations of the Funds to indemnify its trustees, officers,
employees, shareholders, distributors, and agents with respect thereto.
r. The Funds' allocable portion of dues for membership in various industry
organizations, including the Investment Company Institute, the Independent
Directors' Forum and the Mutual Funds Directors Forum.
s. The costs of third-party software used for the Funds' financial reporting,
N-SAR reporting, tax preparation and registration statement preparation as
appropriately allocated to the Funds.
t. Costs of third-party tax notification services used for the Funds (e.g.,
Ernst & Young's PFIC list).
u. The costs of third-party legal advice regarding state tax law issues for the
municipal Funds.
v. The allocable costs of third-party legal services to review loan
documentation for the MFS Floating Rate High Income Fund and other Funds
that purchase bank loans.
w. The costs of third-party legal, accounting or other expert advice incurred
in connection with an examination, investigation, enforcement proceeding,
litigation or other regulatory proceeding of or against the Funds.
EXHIBIT D
ADMINISTRATIVE FEE
In return for the Administrative Services provided by the
Administrator under this Agreement, each Fund shall pay the Administrator fees
as described below:
(i) Fixed Fee: Regardless of asset size, each Fund shall pay an annual
fee to the Administrator in the amount of $10,000.
(ii) Asset-Based Fee: In addition to the Fixed Fee, each Fund shall
pay a fee at the following annual rates, stated as a percentage of the average
daily net assets of the Fund:
0.0000% on average daily net assets from $0 to $35 million;
0.0285% on average daily net assets in excess of $35 million
and less than or equal to $250 million;
0.0275% on average daily net assets in excess of $250
million and less than or equal to $500 million;
0.0255% on average daily net assets in excess of $500
million and less than or equal to $1.0 billion;
0.0235% on average daily net assets in excess of $1.0
billion and less than or equal to $2.0 billion; and
0.0000% on average daily net assets in excess of $2.0
billion.
(iii) Adjustment Based on Aggregate Net Assets.
For purposes of this paragraph (iii), the term "Base Annual
Asset-Based Fees" shall mean the total amount of Asset-Based Fees payable to
the Administrator hereunder for a one year period assuming that the aggregate
net assets of all Funds that pay Asset-Based Fees remain at the same level
throughout the entire annual period as they were on the June 30 immediately
preceding the commencement of such one year period. Further, the term "Maximum
Annual Asset-Based Fees" for any one year period shall be equal to the product
of the Base Annual Asset-Based Fees for all Funds for such period and 1.30; and
the term "Minimum Annual Asset-Based Fees" for any one year period shall be
equal to the product of the Base Annual Asset-Based Fees for all Funds for such
period and 0.70.
Notwithstanding paragraph (ii) above, with respect to the one year
period commencing on the date of execution of this Agreement (August 1, 2006)
and each one year period thereafter (each a "Contract Year"), the total
Asset-Based Fees received by the Administrator shall not exceed the Maximum
Annual Asset-Based Fees for such Contract Year nor be less than the Minimum
Asset-Based Fees for such Contract Year. If this Agreement remains in effect
for less than a full Contract Year, the Maximum and Minimum Annual Asset-Based
Fees for purposes of applying this provision shall be reduced pro rata based on
the portion of the Contract Year that the Agreement is in effect.
In the event that the Administrator is paid an amount equal to the
Maximum Annual Asset-Based Fees for any Contract Year, the Funds shall cease to
pay any Asset-Based Fees hereunder for the remainder of such Contract Year.
If, after completion of a Contract Year, less than the Minimum Annual
Asset-Based Fees has been paid or is payable to the Administrator for such
Contract Year, the Funds shall pay an additional amount of Asset Based Fees (a
"Catch Up Payment") to the Administrator to bring the total up to the level of
the Minimum Annual Asset-Based Fees for such Contract Year, such Catch Up
Payment to be allocated pro rata among the Funds that pay Asset Based Fees
based on their relative net assets at the end of such Contract Year.
