EXHIBIT 99.8(g)
SPECIAL SERVICING AGREEMENT
THIS SPECIAL SERVICING AGREEMENT ("Agreement"), made as of this 1st day of
May, 2007, by and among: (i) MFS Series Trust X, a Massachusetts business trust,
on behalf of each of its series listed in Appendix A; (ii) MFS Series Trust XII,
a Massachusetts business trust, on behalf of each of its series listed in
Appendix A (all series listed in Appendix A are referred to collectively as the
"Top-Tier Funds"); (iii) MFS Series Trust X, a Massachusetts business trust, on
behalf of each of its series listed in Appendix B; (iv) MFS Series Trust I, a
Massachusetts business trust, on behalf of each of its series listed in Appendix
B; (v) MFS Series Trust III, a Massachusetts business trust, on behalf of each
of its series listed in Appendix B; (vi) MFS Series Trust IV, a Massachusetts
business trust, on behalf of each of its series listed in Appendix B; (vii) MFS
Series Trust V, a Massachusetts business trust, on behalf of each of its series
listed in Appendix B; (viii) MFS Series Trust IX, a Massachusetts business
trust, on behalf of each of its series listed in Appendix B; (ix) MFS Series
Trust XI, a Massachusetts business trust, on behalf of each of its series listed
in Appendix B; and (x) MFS Series Trust XIII, a Massachusetts business trust, on
behalf of its series listed in Appendix B (all series listed in Appendix B are
referred to as the "Underlying Funds").
WITNESSETH:
WHEREAS, each Top-Tier Fund and each Underlying Fund is registered as an
open-end management investment company under the Investment Company Act of 1940,
as amended, or is a series of such a registered company.
WHEREAS, each Top-Tier Fund and each Underlying Fund has entered into an
agreement with MFS Service Center, Inc. ("MFSC") under which MFSC provides each
Top-Tier Fund and each Underlying Fund transfer agency and shareholder services
(each, a "Service Agreement");
WHEREAS, the Service Agreement provides for each Top-Tier Fund and each
Underlying Fund to bear sub-accounting and networking fees, including
out-of-pocket expenses for shareholder communications, as well as other transfer
agency expenses, agreed to from time to time by the Board of Trustees of each
Top-Tier Fund and each Underlying Fund (each a "Board") (the "Shared Expenses");
WHEREAS, included as Shared Expenses are the payments due to Sun Life
Retirement Services (U.S.), Inc. ("RSI"), an affiliate of Massachusetts
Financial Services Company ("MFS"), as provided for in a sub-accounting
agreement between MFSC and RSI, pursuant to which RSI provides participant-level
transfer services to participants in retirement plans maintained by RSI who
invest in Top-Tier Funds or Underlying Funds (each, a "RSI Sub-Accounting
Agreement");
WHEREAS, also included as a Shared Expense are the payments due from each
Top-Tier Fund and each Underlying Fund pursuant to sub-accounting and networking
agreements between MFSC and one or more financial intermediaries unaffiliated
with RSI or with MFS, pursuant to which the financial intermediary maintains the
records of underlying owners in a single omnibus account or pursuant to which
the financial intermediary performs all recordkeeping tasks for its customers,
in return for such compensation in amounts not to exceed such amounts as may be
authorized by the Board from time to time (together with the RSI Sub-Accounting
Agreement, the "Sub-Accounting Agreements");
WHEREAS, MFS has provided information to the relevant Board(s) indicating
that each Top-Tier Fund provides certain benefits to the Underlying Funds due to
the incremental increase in assets resulting from investments in the Underlying
Funds by the Top-Tier Funds, the large asset size of each shareholder account
that represents an investment by a Top-Tier Fund in an Underlying Fund relative
to other shareholder accounts, and fewer shareholder transactions and greater
predictability of transaction activity as compared to other shareholder accounts
of Underlying Funds;
WHEREAS, such benefits can result in lower Shared Expenses that the
Underlying Funds must reimburse MFSC under the Service Agreements or pay
pursuant to the Sub-Accounting Agreements than if shareholders of the Top-Tier
Funds invested directly in the Underlying Funds;
WHEREAS, each Top-Tier Fund will invest its assets primarily in the
Underlying Funds, except for temporary defensive purposes and cash or cash items
necessary to meet current expenses and redemptions, and certain other permitted
investments;
WHEREAS, each Board of an Underlying Fund, including a majority of the
Trustees who are not interested persons of such Underlying Fund, has determined,
based on information provided and representations made by MFS, that this
Agreement is in the best interests of each Underlying Fund and its shareholders
and does not involve overreaching on the part of any person concerned and has
made certain additional
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findings (as described in Section 6 below) and has authorized each Top-Tier Fund
and Underlying Fund to enter into this Agreement; and
WHEREAS, the Board of each Underlying Fund, including a majority of the
Trustees who are not interested persons of such Underlying Fund, has determined,
based on information provided and representations made by MFS, that (a) Shared
Expenses charged to the Top-Tier Funds that may be paid by the Underlying Fund
pursuant to this Agreement, either directly or as reimbursement to the Top-Tier
Funds for payments made by such Top-Tier Funds ("Underlying Fund Payments") are
expenses that the Underlying Fund would have incurred if the shareholders of the
Top-Tier Funds had instead purchased shares of the Underlying Fund through the
same broker-dealer or other financial intermediary; (b) the amount of the
Underlying Fund Payments is less than the amount of the benefits realized or
expected to be realized by the Underlying Fund from the investment in the
Underlying Fund by the Top-Tier Funds ("Underlying Fund Benefits"); and (c) by
entering into this Agreement, the Underlying Fund is not engaging, directly or
indirectly, in financing any activity which is primarily intended to result in
the sale of shares issued by the Underlying Fund.
NOW, THEREFORE, in consideration of the promises and mutual covenants made
herein, it is agreed between and among the parties hereto as follows:
1. THE TOP-TIER FUNDS' EXPENSES
MFS will calculate the Shared Expenses incurred by the Top-Tier Funds
either to MFSC under the Service Agreement or pursuant to the Sub-Accounting
Agreements. In addition, MFS will calculate the Underlying Fund Benefits to each
Underlying Fund and each of its classes of shareholders.
2. UNDERLYING FUNDS' PAYMENT OF EXPENSES
Subject to paragraph 3, with respect to each Top-Tier Fund, each of the
Underlying Funds in which the Top-Tier Fund invests shall make Underlying Fund
Payments in an amount equal to a portion of the Shared Expenses incurred by such
Top-Tier Fund for which the calculation is to be made calculated as follows:
- in proportion to the average daily net asset value of such Underlying
Fund's shares owned by such Top-Tier Fund, if the Shared Expense was
incurred based on a percentage of average daily net assets; or
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- in an amount equal to the total amount of the Shared Expense divided
by the number of Underlying Funds in which the Top-Tier Fund has
invested, if the Shared Expense was incurred based on a flat dollar
fee;
provided that (i) no Underlying Fund will pay any such Shared Expense in excess
of (a) its Underlying Fund Benefits; (b) the actual expenses incurred by the Top
Tier Funds (with respect to any Top-Tier Fund, before giving effect to any
expense cap in place for such Top-Tier Fund); or (c) any amount that would cause
such Underlying Fund to exceed the expense cap in place for such Underlying
Fund; (ii) no Underlying Fund will pay Shared Expenses at a rate in excess of
the average per account transfer agent expenses of the Underlying Fund,
including sub-accounting expenses and other out-of-pocket expenses, expressed as
a basis point charge (for purposes of calculating the Underlying Fund's average
per account transfer agent expense the Top-Tier Funds' investment in the
Underlying Fund will be excluded; and (iii) no affiliated person of any Top-Tier
Fund, or affiliated person of such person, will receive, directly or indirectly,
any portion of the Underlying Fund Payments, except for bona fide transfer agent
services approved by the Board of the Underlying Fund, including a majority of
the Trustees who are not interested persons of such Underlying Fund. The
Underlying Funds shall pay the Underlying Fund Payments in accordance with
calculations made by and instructions from MFSC.
3. PAYMENT BY MFS
(a) During 2007, MFS shall continue to reimburse the Top-Tier Funds for
amounts that represent approximately $1.9 million of Shared Expenses
in 2006 which otherwise would be paid by the Funds listed on Appendix
C in which the Top-Tier Funds invest.
(b) In order to implement MFS' agreement to reduce MFSC's profit margin by
$400,000 in 2007 the amount of payments otherwise due by each
Underlying Fund to MFSC pursuant to the Service Agreement shall be
reduced such that the total profit margin otherwise to be received by
MFSC in accordance with the approved budget is reduced in the
aggregate by $400,000. The aggregate reduction shall be allocated
among the Underlying Funds in the same proportion that each Underlying
Fund's Underlying Fund Payment bears to the total of the Underlying
Fund Payments paid by all of the Underlying Funds.
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(c) To the extent Underlying Fund Payments are treated, in whole or in
part, as a class expense of an Underlying Fund, or are used to pay a
class-based expense of a Top-Tier Fund, this Agreement shall be
amended to ensure that the relevant terms of this Agreement are met
with respect to each class of an Underlying Fund as well as the
Underlying Fund as a whole before an Underlying Fund Payment may be
made.
4. OPINION OF COUNSEL
At any time any of the parties hereto may consult legal counsel in respect
of any matter arising in connection with this Agreement, and no such party shall
be liable for any action taken or omitted by it in good faith in reasonable
reliance on and in accordance with such instructions or with the advice or
opinion of such legal counsel.
5. LIABILITIES
No party hereto shall be liable to any other party hereto for any action
taken or thing done by it or its agents or contractors in carrying out the terms
and provisions of this Agreement provided such party has acted in good faith and
without negligence or willful misconduct and selected its agents and contractors
with reasonable care.
6. APPROVAL
The Board of each Underlying Fund, including a majority of the Trustees who
are not interested persons of such Underlying Fund, has determined, based on
information provided and representations made by MFS, that: (a) the Agreement is
in the best interests of each Underlying Fund and its shareholders and does not
involve overreaching on the part of any person concerned; (b) the Underlying
Fund Payments to be made in accordance with this Agreement are expenses that the
Underlying Fund would have incurred if the shareholders of the Top-Tier Funds
had instead purchased shares of the Underlying Fund through the same
broker-dealer or other financial intermediary; (c) the amount of the Underlying
Fund Payments to be made in accordance with this Agreement will be less than the
amount of Underlying Fund Benefits; and (d) by entering into this Agreement, the
Underlying Fund is not engaging, directly or indirectly, in financing any
activity which is primarily intended to result in the sale of shares issued by
the Underlying Fund. Such determinations by such Board of Trustees shall be
based on the following factors, among others, as they apply to each Underlying
Fund:
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1. The reasons for the Underlying Fund's entering into this Agreement;
2. Information quantifying the Underlying Fund Benefits;
3. The extent to which investors in the Top-Tier Funds could have
purchased shares of the Underlying Fund;
4. The extent to which an investment in the Top-Tier Funds represents or
would represent a consolidation of accounts in the Underlying Funds,
through exchanges or otherwise, or a reduction in the rate of increase
in the number of accounts in the Underlying Funds;
5. The extent to which the expense ratio of the Underlying Fund was
reduced following investment in the Underlying Fund by the Top-Tier
Funds and the reasonably foreseeable effects of the investment by the
Top-Tier Funds on the Underlying Fund's expense ratio;
6. The reasonably foreseeable effects of participation in this Agreement
on the Underlying Fund's expense ratio; and
7. Any conflicts of interest that MFS, any affiliated person of MFS, or
any other affiliated person of the Underlying Fund may have relating
to the Underlying Fund's participation in this Agreement.
Each Board has relied on information provided by and representations made
by MFS in considering each of the factors listed above and in support of these
determinations, and MFS agrees to inform each Board promptly if any such
information or representation become(s) materially incorrect or materially
changes.
7. TERM OF AGREEMENT; AMENDMENT; RENEWAL
The term of this Agreement shall begin on May 1, 2007, and unless sooner
terminated as herein provided, the Agreement shall remain in effect for one year
from that date. Thereafter, this Agreement shall continue from year to year with
respect to each Top-Tier Fund and each Underlying Fund if such continuation is
specifically approved at least annually in accordance with Section 6 above by
the Board of Trustees of such Underlying Fund and such Top-Tier Fund, as
applicable, including a majority of the independent Trustees of each such Fund.
This Agreement may be modified or amended from time to time by mutual written
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agreement between the parties hereto. Prior to any such modification or
amendment, the Board of Trustees of an Underlying Fund, including a majority of
the Trustees who are not interested persons of such Underlying Fund, must
approve the amended or modified Agreement in accordance with Section 6 above.
Upon termination hereof, outstanding obligations hereunder shall survive. This
Agreement may be amended in the future to include as additional parties to the
Agreement other investment companies and/or series thereof for which MFS serves
as investment adviser.
8. PROVISION OF INFORMATION; RECORDS
In determining whether to approve or renew this Agreement, the Trustees of
an Underlying Fund shall request and evaluate, and MFS will furnish, (a) such
information relevant to determining the Underlying Fund Benefits, including
information on the amount of Underlying Fund Benefits actually experienced by
each class of shareholders of each Underlying Fund and each Underlying Fund as a
whole during the preceding year; and (b) such other information necessary to
evaluate the terms of this Agreement and the factors set forth in Section 6
above and to make the determinations set forth in Section 6 above. Each
Underlying Fund will maintain and preserve the Board's findings and
determinations made in accordance with Section 6 above, and the information and
considerations on which they were based, for the duration of this Agreement, and
for a period not less than six years thereafter, the first two years in an
easily accessible place.
9. ASSIGNMENT
This Agreement shall not be assigned or transferred, either voluntarily or
involuntarily, by operation of law or otherwise, without the prior written
consent of MFS, the Underlying Funds and each Top-Tier Fund. This Agreement
shall automatically and immediately terminate in the event of its assignment
without prior written consent of such Funds and MFS. For purposes of this
section, "assignment" shall have the meaning ascribed to it in Section 2(a)(4)
of the Investment Company Act of 1940, as amended, and Rule 2a-4 thereunder.
10. NOTICE
Any notice under this Agreement shall be in writing, addressed and
delivered or sent by registered or certified mail, postage prepaid, to the other
party at such address as such other party may designate for the receipt of such
notices. Until further notice to the other parties, it is agreed
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that for this purpose: (a) the address of all parties to this Agreement is 000
Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 -- Attention: Chief Legal Officer;
and (b) the address of MFS and MFSC is 000 Xxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000 -- Attention: General Counsel.
11. INTERPRETIVE PROVISIONS
In connection with the operation of this Agreement, the parties may agree
from time to time on such provisions interpretive of or in addition to the
provisions of this Agreement as may in their joint opinion be consistent with
the general tenor of this Agreement. Any such interpretive or additional
provisions are to be signed by all parties and annexed hereto, but no such
provisions shall contravene any applicable Federal or State Law or regulation.
Also, no existing provision of this Agreement, or interpretive or additional
provision described above, shall be effective if, as a result any Top-Tier Fund
or any Underlying Fund would lose its status as a regulated investment company
under Subchapter M of the Internal Revenue Code.
12. STATE LAW
This Agreement shall be construed and enforced in accordance with and
governed by the laws of The Commonwealth of Massachusetts.
13. CAPTIONS
The captions in this Agreement are included for convenience of reference
only and in no way define or limit any of the provisions hereof or otherwise
affect their construction or effect. With respect to any party which is
organized as a Massachusetts business trust, references in this Agreement to the
party mean and refer to the Trustees from time to time serving under its
Declaration of Trust on file with the Secretary of the Commonwealth of
Massachusetts, as the same may be amended from time to time, pursuant to which
the party conducts its business. The obligations of the party hereunder shall
not be binding upon any of the Trustees, shareholders, nominees, officers,
agents or employees of the party personally, but shall bind only the trust
property of the party, as provided in said Declaration of Trust.
With respect to any party which is organized as a Massachusetts business
trust, if the party has more than one series, no series of the party other than
the series on whose behalf an obligation shall have been undertaken shall be
responsible for the obligations of the series, and third parties shall look only
to the assets of that series to satisfy those obligations.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the day and year first above written.
MFS SERIES TRUST X
on behalf of its series:
MFS AGGRESSIVE GROWTH ALLOCATION FUND
MFS CONSERVATIVE ALLOCATION FUND
MFS EMERGING MARKETS EQUITY FUND
MFS FLOATING RATE HIGH INCOME FUND
MFS GROWTH ALLOCATION FUND
MFS INTERNATIONAL DIVERSIFICATION FUND
MFS INTERNATIONAL GROWTH FUND
MFS INTERNATIONAL VALUE FUND
MFS MODERATE ALLOCATION FUND
MFS SERIES TRUST XII
on behalf of its series:
MFS LIFETIME RETIREMENT INCOME FUND
MFS LIFETIME 2010 FUND
MFS LIFETIME 2020 FUND
MFS LIFETIME 2030 FUND
MFS LIFETIME 2040 FUND
MFS SERIES TRUST I
on behalf of its series:
MFS NEW DISCOVERY FUND
MFS RESEARCH INTERNATIONAL FUND
MFS STRATEGIC GROWTH FUND
MFS VALUE FUND
MFS SERIES TRUST III
on behalf of its series:
MFS HIGH INCOME FUND
MFS SERIES TRUST IV
on behalf of its series:
MFS MID CAP GROWTH FUND
MFS MONEY MARKET FUND
MFS SERIES TRUST V
on behalf of its series:
MFS INTERNATIONAL NEW DISCOVERY FUND
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MFS RESEARCH FUND
MFS SERIES TRUST IX
on behalf of its series:
MFS INFLATION-ADJUSTED BOND FUND
MFS INTERMEDIATE INVESTMENT GRADE
BOND FUND
MFS LIMITED MATURITY FUND
MFS RESEARCH BOND FUND
MFS SERIES TRUST XI
on behalf of its series:
MFS MID CAP VALUE FUND
MFS SERIES TRUST XIII
on behalf of its series:
MFS GOVERNMENT SECURITIES FUND
By: XXXXX XXXXX
----------------------------------------
Name: XXXXX XXXXX
Title: President
MFS acknowledges and agrees that it is responsible for all of its acts and
omissions in performing its obligations under this Agreement.
MASSACHUSETTS FINANCIAL SERVICES
COMPANY
By: XXXX XXXXXX
----------------------------------------
Name: XXXX XXXXXX
Title: Chief Financial Officer
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APPENDIX A
The following Funds are parties to this Agreement, and have so indicated
their intention to be bound by such Agreement as "Top-Tier Funds" by execution
of the Agreement:
MFS SERIES TRUST X
MFS AGGRESSIVE GROWTH ALLOCATION FUND
MFS CONSERVATIVE ALLOCATION FUND
MFS GROWTH ALLOCATION FUND
MFS INTERNATIONAL DIVERSIFICATION FUND
MFS MODERATE ALLOCATION FUND
MFS SERIES TRUST XII
MFS LIFETIME RETIREMENT INCOME FUND
MFS LIFETIME 2010 FUND
MFS LIFETIME 2020 FUND
MFS LIFETIME 2030 FUND
MFS LIFETIME 2040 FUND
00
XXXXXXXX X
The following Funds are parties to this Agreement, and have so indicated
their intention to be bound by such Agreement as "Underlying Funds" by execution
of the Agreement:
MFS SERIES TRUST X
MFS EMERGING MARKETS EQUITY FUND
MFS FLOATING RATE HIGH INCOME FUND
MFS INTERNATIONAL GROWTH FUND
MFS INTERNATIONAL VALUE FUND
MFS SERIES TRUST I
MFS NEW DISCOVERY FUND
MFS RESEARCH INTERNATIONAL FUND
MFS STRATEGIC GROWTH FUND
MFS VALUE FUND
MFS SERIES TRUST III
MFS HIGH INCOME FUND
MFS SERIES TRUST IV
MFS MID CAP GROWTH FUND
MFS MONEY MARKET FUND
MFS SERIES TRUST V
MFS INTERNATIONAL NEW DISCOVERY FUND
MFS RESEARCH FUND
MFS SERIES TRUST IX
MFS INFLATION-ADJUSTED BOND FUND
MFS INTERMEDIATE INVESTMENT GRADE
BOND FUND
MFS LIMITED MATURITY FUND
MFS RESEARCH BOND FUND
MFS SERIES TRUST XI
MFS MID CAP VALUE FUND
MFS SERIES TRUST XIII
MFS GOVERNMENT SECURITIES FUND
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APPENDIX C
The following Funds are funds in which Top-Tier Funds invest but which are
subject to an expense cap:
MFS SERIES TRUST X
MFS FLOATING RATE HIGH INCOME FUND
MFS SERIES TRUST IX
MFS INFLATION-ADJUSTED BOND FUND
MFS INTERMEDIATE INVESTMENT GRADE
BOND FUND
MFS RESEARCH BOND FUND
MFS SERIES TRUST XI
MFS MID CAP VALUE FUND
MFS SERIES TRUST XIII
MFS GOVERNMENT SECURITIES FUND
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