EXHIBIT NO. 99.4(e)
INVESTMENT SUB-ADVISORY AGREEMENT
INVESTMENT SUB-ADVISORY AGREEMENT, dated this 1st day of May, 2006, among
MFS SERIES TRUST XIII, a Massachusetts business trust (the "Trust"),
MASSACHUSETTS FINANCIAL SERVICES COMPANY, a Delaware corporation (the
"Adviser") and SUN CAPITAL ADVISERS LLC., a Delaware limited liability company
(the "Sub-Adviser").
WITNESSETH:
WHEREAS, the Adviser is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended ("Advisers Act");
WHEREAS, the Adviser has entered into an Investment Advisory Agreement dated
May 1, 2006 with the Trust, an investment company registered under the
Investment Company Act of 1940, as amended ("Investment Company Act"), on
behalf of its series, the MFS Diversified Income Fund (the "Fund");
WHEREAS, the Adviser has the authority under the Investment Management
Agreement with the Trust to select sub-advisers for the Fund; and
WHEREAS, the Sub-Adviser is registered as an investment adviser under the
Advisers Act; and
WHEREAS, the Board of Trustees of the Trust and the Adviser desire to retain
the Sub-Adviser to render investment advisory and other services for a portion
of the Fund's assets (the "Portfolio"), in the manner and on the terms
hereinafter set forth; and
WHEREAS, the Sub-Adviser is willing to furnish such services to the Adviser and
the Portfolio;
NOW, THEREFORE, the Adviser and the Sub-Adviser agree as follows:
1. APPOINTMENT OF THE SUB-ADVISER
The Adviser hereby appoints the Sub-Adviser to act as an investment adviser for
the Portfolio, subject to the supervision and oversight of the Adviser and the
Trustees of the Trust, and in accordance with the terms and conditions of this
Agreement. The Sub-Adviser will be an independent contractor and will have no
authority to act for or represent the Trust or the Adviser in any way or
otherwise be deemed an agent of the Trust or the Adviser except as expressly
authorized in this Agreement or another writing by the Trust, the Adviser and
the Sub-Adviser.
2. ACCEPTANCE OF APPOINTMENT
The Sub-Adviser accepts that appointment and agrees to render the services
herein set forth, for the compensation herein provided.
The assets of the Fund will be maintained in the custody of a custodian (who
shall be identified by the Adviser in writing). The Sub-Adviser will not have
custody of any securities, cash or other assets of the Portfolio and shall not
be responsible for any functions or responsibilities incident to the role of a
custodian, including safekeeping of assets, collection of income and settlement
of transactions.
3. SERVICES TO BE RENDERED BY THE SUB-ADVISER TO THE TRUST
A. As investment adviser to the Portfolio, the Sub-Adviser shall manage the
investment and reinvestment of the assets of the Portfolio and determine the
composition of the assets of the Portfolio, subject always to the supervision
and control of the Adviser and the Trustees of the Trust.
B. As part of the services it will provide hereunder, the Sub-Adviser will:
(i) obtain and evaluate, to the extent deemed necessary and advisable by the
Sub-Adviser in its discretion, pertinent economic, statistical, financial, and
other information affecting the economy generally and individual companies or
industries, the securities of which are included in the Portfolio or are under
consideration for inclusion in the Portfolio;
(ii) formulate and implement a continuous investment program for the Portfolio;
(iii) take whatever steps are necessary to implement the investment program for
the Portfolio by arranging, subject to Section 3F, for the purchase and sale of
securities and other investments, including issuing directives to the
administrator of the Fund as necessary for the appropriate implementation of
the investment program of the Portfolio;
(iv) keep the Trustees of the Trust and the Adviser promptly informed of
developments materially affecting the Portfolio and/or its holdings and will
furnish the Adviser and the Trustees of the Trust with such written information
or reports concerning (a) the investment and reinvestment of the assets in the
Portfolio, and (b) the Sub-Adviser and its key investment personnel and
operations as may reasonably be requested from time to time by the Adviser or
the Trustees of the Trust. The Sub-Adviser will attend meetings with the
Adviser and/or the Trustees, as reasonably requested, to discuss the foregoing.
Further, the Sub-Adviser agrees to provide the Adviser reasonable access to the
Sub-Adviser's records in connection with the services provided hereunder;
provided however, that access to records of the Sub-Adviser containing
information about other clients of the Sub-Adviser (which shall be kept
separate from Portfolio records) shall exclude information regarding the
identity of other clients of the Sub-Adviser.
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(v) provide reasonable assistance to the Adviser or the Trustees of the Trust
in their determination of the fair value, in accordance with the Trust's
valuation procedures, of securities and other assets in the Portfolio for which
market prices are not readily available. The Sub-Adviser shall not bear
responsibility or liability for the determination or accuracy of the valuation
of any security or other asset in the Portfolio.
(vi) provide composite performance information for those accounts managed by
the Sub-Adviser that have investment objectives, policies, and strategies
substantially similar to those of the Portfolio, and as reasonably requested by
the Adviser, supporting documentation, and allow the Fund or its agent to
present information concerning Sub-Adviser's prior performance in the Trust's
Prospectus and SAI (as hereinafter defined) and any permissible reports and
materials prepared by the Fund or its agent; and
(vii) cooperate with and provide such assistance to the Adviser, the Trust's
administrator, the Trust's custodian and foreign custodians, the Trust's
transfer agent and pricing agents and all other agents and representatives of
the Trust and the Adviser as reasonably necessary to the performance of their
obligations to the Trust and the Adviser, provide prompt responses to
reasonable requests made by such persons, and maintain any appropriate
interfaces with each so as to promote the efficient exchange of information.
C. In furnishing services hereunder, the Sub-Adviser shall be subject to, and
shall perform in accordance with the following: (i) the Trust's Declaration of
Trust, as the same may be hereafter modified and/or amended from time to time
("Trust Declaration"); (ii) the By-Laws of the Trust, as the same may be
hereafter modified and/or amended from time to time ("By-Laws"); (iii) the
currently effective Prospectus and Statement of Additional Information of the
Trust filed with the Securities and Exchange Commission ("SEC") and delivered
to the Sub-Adviser, as the same may be hereafter modified, amended and/or
supplemented ("Prospectus and SAI"); (iv) the Investment Company Act and the
Advisers Act and the rules under each, and all other federal and state laws or
regulations applicable to the Trust and the Fund; (v) such other policies and
procedures adopted from time to time by the Adviser or the Board of Trustees of
the Trust as applicable to the services provided by the Sub-Adviser to the
Portfolio; provided, however, that the Sub-Adviser will not be bound to follow
any policies or procedures adopted by the Adviser until such documents have
been delivered in writing to the Sub-Adviser; and (vi) the written instructions
of the Adviser. Prior to the commencement of the Sub-Adviser's services
hereunder, the Adviser shall provide the Sub-Adviser with current copies of the
Trust Declaration, By-Laws, Prospectus and SAI, and other relevant policies and
procedures that are adopted by the Board of Trustees or the Adviser, and shall
promptly deliver to the Sub-Adviser any amendments or additions to such
documents. The Adviser acknowledges that the Sub-Adviser is not the principal
compliance agent for the Fund or the Adviser, and does not have access to all
of the Fund's books and records necessary to perform compliance testing for the
Fund. In connection with the services provided by the Sub-Adviser as specified
in this Agreement, the Sub-Adviser shall perform such services based on the
information reflected on its books and records with respect to the Portfolio,
and information or instructions provided by the Adviser or the Fund's
custodian; provided that the Sub-Adviser shall reconcile such information with
the Fund's custodian on a daily basis; and shall not be responsible under this
Agreement for compliance with items (i) through (vi) of this section 3C as long
as it performs such services in accordance with such information.
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D. In furnishing services hereunder, the Sub-Adviser will not consult with any
other adviser to (i) the Fund, (ii) any other Fund of the Trust or (iii) any
other investment company under common control with the Trust concerning
transactions of the Portfolio in securities or other assets. (This shall not be
deemed to prohibit the Sub-Adviser from consulting with any of its affiliated
persons concerning transactions in securities or other assets. This shall also
not be deemed to prohibit the Sub-Adviser from consulting with any of the other
covered advisers concerning compliance with paragraphs (a) and (b) of Rule
12d3-1 under the Investment Company Act.)
E. The Sub-Adviser, at its expense, will furnish: (i) all necessary facilities
and personnel, including salaries, expenses and fees of any personnel required
for them to faithfully perform their duties under this Agreement; and
(ii) administrative facilities, including bookkeeping, and all equipment
necessary for the efficient conduct of the Sub-Adviser's duties under this
Agreement.
F. The Sub-Adviser will select brokers and dealers to effect all portfolio
transactions subject to the conditions set forth herein. The Sub-Adviser will
place all necessary orders with brokers, dealers, or issuers, and will
negotiate brokerage commissions, if applicable. The Sub-Adviser is directed at
all times to seek to execute transactions for the Portfolio (i) in accordance
with any written policies, practices or procedures that may be established by
the Board of Trustees or the Adviser from time to time and which have been
provided to the Sub-Adviser or (ii) as described in the Trust's Prospectus and
SAI. In placing any orders for the purchase or sale of investments for the
Portfolio, in the name of the Fund or its nominees, the Sub-Adviser shall seek
to obtain for the Portfolio the best overall terms available, taking into
account all appropriate factors the Sub-Adviser reasonably deems relevant,
including the breadth of the market in and the price of the security, the
reasonableness of the commission or dealer spread, and the size and difficulty
of the transaction, and shall maintain records adequate to demonstrate
compliance with this requirement. Upon request, the Sub-Adviser agrees to
provide the Adviser and/or the Trust with regular reports presenting execution
analysis. In no instance will portfolio securities be purchased from or sold to
the Sub-Adviser, or any affiliated person thereof, except in accordance with
the Investment Company Act, the Advisers Act and the rules under each, and all
other federal and state laws or regulations applicable to the Trust and the
Fund. The Sub-Adviser agrees that in selecting broker-dealers to effect
portfolio securities transactions of the Portfolio, it (i) will not take into
account a broker-dealer's promotion or sale of shares issued by the Fund or any
other registered investment company; and (2) will not enter into any agreement
or other understanding under which the Portfolio directs, or is expected to
direct, portfolio securities transactions or "commissions" to a broker-dealer
in consideration for the promotion or sale of shares issued by the Fund or any
other registered investment company.
G. Subject to the appropriate policies and procedures approved by the Trust's
Board of Trustees, the Sub-Adviser may, to the extent authorized by
Section 28(e) of the Securities Exchange Act of 1934, as amended ("Exchange
Act") cause the Portfolio to pay a broker or
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dealer that provides brokerage or research services to the Sub-Adviser and the
Portfolio an amount of commission for effecting a portfolio transaction in
excess of the amount of commission another broker or dealer would have charged
for effecting that transaction if the Sub-Adviser determines, in good faith,
that such amount of commission is reasonable in relationship to the value of
such brokerage or research services provided viewed in terms of that particular
transaction or the Sub-Adviser's overall responsibilities to the Portfolio or
its other advisory clients. To the extent authorized by Section 28(e) and the
Trust's Board of Trustees, the Sub-Adviser shall not be deemed to have acted
unlawfully or to have breached any duty created by this Agreement or otherwise
solely by reason of such action. Subject to seeking best execution, the Board
of Trustees or the Adviser may direct the Sub-Adviser to effect transactions in
portfolio securities through broker-dealers in a manner that will help generate
resources to pay the cost of certain expenses that the Trust is required to pay
or for which the Trust is required to arrange payment.
H. On occasions when the Sub-Adviser deems the purchase or sale of a security
to be in the best interest of the Portfolio as well as other clients of the
Sub-Adviser, the Sub-Adviser to the extent permitted by applicable laws and
regulations, may, but shall be under no obligation to, aggregate the securities
to be purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. Allocation of the securities so
purchased or sold, as well as the expenses incurred in the transaction, will be
made by the Sub-Adviser in the manner which the Sub-Adviser considers to be the
most equitable and consistent with its fiduciary obligations to the Portfolio
and to its other clients over time. The Adviser agrees that the Sub-Adviser and
its affiliates may give advice and take action in the performance of their
duties with respect to any of their other clients that may differ from advice
given, or the timing or nature of actions taken, with respect to the Portfolio.
The Adviser also acknowledges that the Sub-Adviser and its affiliates are
fiduciaries to other entities, some of which have the same or similar
investment objectives (and will hold the same or similar investments) as the
Portfolio, and that the Sub-Adviser will carry out its duties hereunder
together with its duties under such relationships. Nothing in this Agreement
shall be deemed to confer upon the Sub-Adviser any obligation to purchase or to
sell or to recommend for purchase or sale for the Portfolio any investment that
the Sub-Adviser, its affiliates, officers or employees may purchase or sell for
its or their own account or for the account of any client, if in the sole and
absolute discretion of the Sub-Adviser it is for any reason impractical or
undesirable to take such action or make such recommendation for the Portfolio.
I. The Sub-Adviser will maintain all accounts, books and records with respect
to the Portfolio as are required of an investment adviser of a registered
investment company pursuant to the Investment Company Act and Advisers Act and
the rules thereunder and shall file with the SEC all forms pursuant to
Section 13 of the Exchange Act, with respect to its duties as are set forth
herein.
J. Unless and until the Sub-Adviser is otherwise directed by the Adviser or the
Board of Trustees, the Adviser will exercise all rights of security holders
with respect to securities held by the Fund, including, but not limited to:
voting proxies, converting, tendering, exchanging or redeeming securities;
acting as a claimant in class action litigation (including litigation with
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respect to securities previously held); and exercising rights in the context of
a bankruptcy or other reorganization. In accordance with the proxy voting
policies and procedures adopted for the Fund by the Trust's Board of Trustees,
the Adviser or the Trust may, from time to time, request that the Sub-Adviser
provide reasonable assistance to the Adviser or the Trust in their
determination of how to vote certain proxies, including taking action with
respect to corporate actions, relating to securities held by the Portfolio. The
Sub-Adviser shall bear no responsibility for making determinations as to how
any proxy should be voted.
K. The Sub-Adviser agrees that it only disclose Portfolio holdings to third
parties with the prior written approval of the Adviser and in compliance with
applicable law.
4. COMPENSATION OF SUB-ADVISER
The Adviser will pay the Sub-Adviser an advisory fee with respect to the
Portfolio as specified in Appendix A to this Agreement. Payments shall be made
to the Sub-Adviser on or about the twentieth day of each month; however, this
advisory fee will be calculated daily for the Portfolio based on the net assets
of the Portfolio on each day and accrued on a daily basis. The Fund shall have
no responsibility for any fee payable to the Sub-Adviser. In the event of
termination of this Agreement, the fee provided in this Section shall be
computed on the basis of the period ending on the last business day on which
this Agreement is in effect subject to a pro rata adjustment based on the
number of days elapsed in the current month as a percentage of the total number
of days in such month.
5. LIABILITY AND INDEMNIFICATION
Except as may otherwise be provided by the Investment Company Act or any other
federal securities law, neither the Sub-Adviser nor any of its officers,
members or employees (its "Affiliates") shall be liable for any losses, claims,
damages, liabilities or litigation (including legal and other expenses)
incurred or suffered by the Adviser or the Trust as a result of any error of
judgment or mistake of law by the Sub-Adviser or its Affiliates with respect to
the Portfolio, except that nothing in this Agreement shall operate or purport
to operate in any way to exculpate, waive or limit the liability of the
Sub-Adviser or its Affiliates for, and the Sub-Adviser shall indemnify and hold
harmless the Trust, the Adviser, all affiliated persons thereof (within the
meaning of Section 2(a)(3) of the Investment Company Act) and all controlling
persons (as described in Section 15 of the Securities Act of 1933, as amended
("1933 Act")) (collectively, "Adviser Indemnitees") against any and all losses,
claims, damages, liabilities or litigation (including reasonable legal and
other expenses) to which any of the Adviser Indemnitees may become subject
under the 1933 Act, the Investment Company Act, the Advisers Act, or under any
other statute, or common law or otherwise arising out of or based on (i) any
willful misconduct, bad faith, reckless disregard or gross negligence of the
Sub-Adviser in the performance of any of its duties or obligations hereunder,
(ii) any breach of any duty or warranty hereunder of the Sub-Adviser or any
inaccuracy of any representation of the Sub-Adviser hereunder, (iii) subject to
section 3C above, the Portfolio's failure to satisfy the diversification or
source of income requirements of Subchapter M of the Code by reason of any
action or omission of the Sub-Adviser, unless acting at the direction of the
Adviser, (iv) subject to section 3C above,
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the Portfolio being in violation of any applicable federal or state law, rule
or regulation or any investment policy or restriction set forth in the Fund's
Registration Statement or any written guidelines or instruction provided in
writing by the Board of Trustees or the Adviser, by reason of any action or
omission of the Sub-Adviser, (v) any untrue statement of a material fact
contained in the Prospectus and SAI, proxy materials, reports, advertisements,
sales literature, or other materials pertaining to the Portfolio or the
omission to state therein a material fact known to the Sub-Adviser which was
required to be stated therein or necessary to make the statements therein not
misleading, if such statement or omission was made in reliance upon information
furnished to the Adviser or the Trust by the Sub-Adviser Indemnitees (as
defined below) for use therein.
The Adviser shall indemnify and hold harmless the Sub-Adviser, all affiliated
persons thereof (within the meaning of Section 2(a)(3) of the Investment
Company Act) and all controlling persons (as described in Section 15 of the
Securities Act of 1933, as amended ("1933 Act")) (collectively, "Sub-Adviser
Indemnitees") against any and all losses, claims, damages, liabilities or
litigation (including reasonable legal and other expenses) to which any of the
Sub-Adviser Indemnitees may become subject under the 1933 Act, the Investment
Company Act, the Advisers Act, or under any other statute, or common law or
otherwise arising out of or based on (i) any willful misconduct, bad faith,
reckless disregard or gross negligence of the Adviser in the performance of any
of its duties or obligations hereunder, (ii) any breach of any duty or warranty
hereunder of the Adviser or any inaccuracy of any representation of the Adviser
hereunder, (iii) any untrue statement of a material fact contained in the
Prospectus and SAI, proxy materials, reports, advertisements, sales literature,
or other materials pertaining to the Fund or the omission to state therein a
material fact known to the Adviser which was required to be stated therein or
necessary to make the statements therein not misleading, if such statement or
omission was made in reliance upon information furnished to the Sub-Adviser by
the Adviser Indemnitees for use therein.
A copy of the Trust's Declaration of Trust is on file with the Secretary of
State of The Commonwealth of Massachusetts. The Sub-Adviser acknowledges that
the obligations of or arising out of this Agreement are not binding upon any of
the Trust's Trustees, officers, employees, agents or shareholders individually,
but are binding solely upon the assets and property of the Trust. The
Sub-Adviser further acknowledges that the assets and liabilities of the Fund
are separate and distinct from other funds in the Trust and that the
obligations of or arising out of this Agreement are binding solely upon the
assets or property of the Fund and not upon the assets or property of any other
fund in the Trust.
6. REPRESENTATIONS OF THE ADVISER AND SUB-ADVISER
The Adviser and Sub-Adviser represent, warrant and agree as follows:
A. Each of the Adviser and Sub-Adviser (i) is registered as an investment
adviser under the Advisers Act and will continue to be so registered for so
long as this Agreement remains in effect; (ii) is not prohibited by the
Investment Company Act, the Advisers Act or other law, regulation or order from
performing the services contemplated by this Agreement; (iii) has met
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and will seek to continue to meet for so long as this Agreement remains in
effect, any other applicable federal or state requirements, or the applicable
requirements of any regulatory or industry self-regulatory agency necessary to
be met in order to perform the services contemplated by this Agreement;
(iv) has the authority to enter into and perform the services contemplated by
this Agreement; and (v) will promptly notify the other party to this Agreement
of the occurrence of any event that would disqualify the Adviser or Sub-Adviser
from serving as an investment adviser of an investment company pursuant to
Section 9(a) of the Investment Company Act or otherwise. Each of the Adviser
and Sub-Adviser will also promptly notify the Fund and the other party to this
Agreement if it is served or otherwise receives notice of any action, suit,
proceeding, inquiry or investigation, at law or in equity, before or by any
court, public board or body, involving the affairs of the Fund.
B. Each of the Adviser and Sub-Adviser has adopted a written code of ethics
complying with the requirements of Rule 17j-1 under the Investment Company Act
and Rule 204A-1 under the Advisers Act, which it has provided to the Trust.
Within a reasonable period following the last calendar quarter of each year
that this Agreement is in effect, and as otherwise requested, a representative
of senior management of the Sub-Adviser shall certify to the Adviser that the
Sub-Adviser has complied with the requirements of Rule 17j-1 and Rule 204A-1
during the previous year and that there has been no material violation of the
Sub-Adviser's code of ethics or, if such a material violation has occurred,
that appropriate action was taken in response to such violation.
C. The Sub-Adviser has provided the Trust and the Adviser with a copy of its
Form ADV, which as of the date of this Agreement is its current Form ADV and
promptly will furnish a copy of all amendments to the Trust and the Adviser at
least annually.
D. The Sub-Adviser will notify the Trust and the Adviser of any assignment of
this Agreement or change of control of the Sub-Adviser, as applicable, and any
changes in the key personnel who are either the portfolio manager(s) of the
Fund or senior management of the Sub-Adviser, in each case prior to or promptly
after, such change. The Sub-Adviser agrees to bear all reasonable expenses of
the Trust, if any, arising out of an assignment or change in control.
E. The Sub-Adviser agrees to maintain an appropriate level of errors and
omissions or professional liability insurance coverage. The Sub-Adviser shall
provide prior written notice to the Adviser (i) of any material changes in its
insurance policies or insurance coverage; or (ii) if any claims will be made
under its insurance policies. Furthermore, it shall upon request provide to the
Adviser any information it may reasonably require concerning the amount of or
scope of such insurance.
F. The Sub-Adviser agrees that neither it, nor any of its affiliates, will
knowingly in any way refer directly or indirectly to its relationship with the
Trust, the Fund, the Adviser or any of their respective affiliates in offering,
marketing or other promotional materials without the express written consent of
the Adviser, except as required by rule, regulation or upon the request of a
governmental authority. However, the Sub-Adviser may use the performance of the
Portfolio in its composite performance.
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G. The Sub-Adviser shall ensure that sufficient and competent investment
management, administrative and compliance staff experienced in managing
accounts similar to the Portfolio shall have charge at all times of the conduct
of, and shall maintain close supervision of, the investment and management of
the Portfolio. For the avoidance of doubt, the Sub-Adviser shall ensure that
any affiliate or third party to whom its duties have been delegated, shall
comply with the foregoing.
H. The Sub-Adviser shall act honestly, in good faith and in the best interests
of the Fund including requiring any of its personnel with knowledge of the
Fund's activities to place the interest of the Fund first, ahead of their own
interests, in all personal trading scenarios that may involve a conflict of
interest with the Fund.
I. The Sub-Adviser has reviewed and will in the future review, the Registration
Statement, and any amendments or supplements thereto, the annual or semi-annual
reports to shareholders, other reports filed with the Commission and any
marketing material of the Fund (collectively the "Disclosure Documents") and
represents and warrants that with respect to disclosure about the Sub-Adviser,
the manner in which the Portfolio is managed or information relating directly
or indirectly to the Sub-Adviser, such Disclosure Documents contain or will
contain, as of the date thereof, no untrue statement of any material fact and
do not omit any statement of material fact which was required to be stated
therein or necessary to make the statements contained therein not misleading.
J. The Adviser represents that the Trust has adopted and implemented and shall
maintain written policies and procedures that are reasonably designed to
prevent violation of the "Federal Securities Laws" as such term is defined in
Rule 38a-1 under the 1940.
K. With respect to those activities that it performs for or on behalf of the
Fund, the Adviser has adopted and implemented policies and procedures
reasonably designed to prevent the Fund from violating the "Federal Securities
Laws", as such term is defined in Rule 38a-1 under the 1940 Act, and the
Advisers Act and the rules thereunder as required by Rule 206(4)-7 under the
Advisers Act;
L. With respect to those activities that it performs for or on behalf of the
Fund, the Sub-Adviser has adopted and implemented policies and procedures
reasonably designed to prevent the Fund from violating the "Federal Securities
Laws", as such term is defined in Rule 38a-1 under the 1940 Act, and the
Advisers Act and the rules thereunder as required by Rule 206(4)-7 under the
Advisers Act;
M. No less frequently than quarterly or as otherwise reasonably requested by
the Adviser or Trust, the Sub-Adviser shall provide a report, in a form
mutually agreed upon by the Adviser and the Sub-Adviser, regarding:
(i) the adequacy of the Sub-Adviser's policies and procedures; and
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(ii) the effectiveness of the implementation of the Sub-Adviser's policies
and procedures; and
(iii) any material changes made to the Sub-Adviser's policies and procedures
since the date of the last report delivered pursuant to this section; and
(iv) each "Material Compliance Matter", as such term is defined in Rule
38a-1 under the 1940 Act, relevant to the services provided by the Sub-Adviser
to the Portfolio under this Agreement.
N. The Sub-Adviser will provide such certifications as the Advisor or the Trust
may reasonably request related to the services provided by the Sub-Adviser
under this Agreement.
7. NON-EXCLUSIVITY
The services of the Sub-Adviser to the Adviser, the Portfolio, the Fund and the
Trust are not to be deemed to be exclusive, and the Sub-Adviser shall be free,
subject to limitations in any other agreement between the Adviser and the
Sub-Adviser, to render investment advisory or other services to others and to
engage in other activities. It is understood and agreed that, subject to
limitations in any other agreement between the Adviser and the Sub-Adviser or
such persons, the directors, officers, and employees of the Sub-Adviser 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,
trustees, or employees of any other firm or corporation.
8. REGULATION
The Sub-Adviser shall submit to all regulatory and administrative bodies having
jurisdiction over the services provided pursuant to this Agreement any
information, reports, or other material which any such body by reason of this
Agreement may request or require pursuant to applicable laws and regulations.
The Sub-Adviser shall promptly inform the Adviser of any regulatory examination
or investigation relating to the Fund or the services provided by the
Sub-Adviser to the Portfolio and/or the Fund.
9. RECORDS
In connection with the investment of assets and placement of orders for the
execution of the portfolio transactions of the Portfolio, the Sub-Adviser shall
create and maintain all necessary records on behalf of the Portfolio in
accordance with all applicable laws, rules and regulations, including but not
limited to records required by Section 31(a) of the 1940 Act. All records shall
be the property of the Trust and shall be available for inspection and use by
the SEC, the Trust, the Adviser or any person retained by the Trust at all
reasonable times. Where applicable, such records shall be maintained by the
Sub-Adviser for the periods and in the places required by Rule 31a-2 under the
1940 Act. In the event of the termination of this Agreement, such records shall
promptly be returned to the Trust by the Sub-Adviser free from any claim or
retention of rights therein, provided that the Sub-Adviser may retain any such
records that are required by law or
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regulation. Each of the Adviser and the Sub-Adviser shall keep confidential any
information obtained in connection with its duties hereunder and disclose such
information only if such information is otherwise in the public domain other
than through the fault of the receiving party, if the Trust has authorized such
disclosure, or if such disclosure is expressly required or requested by
applicable federal or state regulatory authorities, or otherwise required by
law.
10. DURATION OF AGREEMENT
This Agreement shall become effective upon the date of its execution. This
Agreement will continue in effect for a period more than two years from the
date of its execution only so long as such continuance is specifically approved
at least annually by the Board of Trustees provided that in such event such
continuance shall also be approved by the vote of a majority of the Independent
Trustees cast in person at a meeting called for the purpose of voting on such
approval.
11. TERMINATION OF AGREEMENT
This Agreement may be terminated at any time, without the payment of any
penalty, by the Board of Trustees, including a majority of the Independent
Trustees, by the vote of a majority of the outstanding voting securities of the
Fund, on sixty (60) days' written notice to the Adviser and the Sub-Adviser, or
by the Adviser or Sub-Adviser on sixty (60) days' written notice to the Trust
and the other party. This Agreement will automatically terminate, without the
payment of any penalty, (i) in the event of its assignment (as defined in the
Investment Company Act), or (ii) in the event the Investment Advisory Agreement
between the Adviser and the Trust is assigned (as defined in the Investment
Company Act) or terminates for any other reason. This Agreement will also
terminate upon written notice to the other party that the other party is in
material breach of this Agreement, unless the other party in material breach of
this Agreement cures such breach to the reasonable satisfaction of the party
alleging the breach within thirty (30) days after written notice.
12. USE OF THE SUB-ADVISER'S NAME
The parties agree that the name of the Sub-Adviser, the names of any affiliates
of the Sub-Adviser and any derivative or logo or trademark or service xxxx or
trade name are the valuable property of the Sub-Adviser and its affiliates. The
Adviser and the Trust shall have the right to use such name(s), derivatives,
logos, trademarks or service marks or trade names only with the prior written
approval of the Sub-Adviser, which approval shall not be unreasonably withheld
or delayed so long as this Agreement is in effect.
Upon termination of this Agreement, the Adviser and the Trust shall forthwith
cease to use such name(s), derivatives, logos, trademarks or service marks or
trade names. The Adviser and the Trust agree that they will review with the
Sub-Adviser any advertisement, sales literature, or notice prior to its use
that makes reference to the Sub-Adviser or its affiliates or any such name(s),
derivatives, logos, trademarks, service marks or trade names so that the
Sub-Adviser may review the context in which it is referred to, it being agreed
that the Sub-Adviser shall have
- 11 -
no responsibility to ensure the adequacy of the form or content of such
materials for purposes of the Investment Company Act or other applicable laws
and regulations. If the Adviser or the Trust makes any unauthorized use of the
Sub-Adviser's names, derivatives, logos, trademarks or service marks or trade
names, the parties acknowledge that the Sub-Adviser shall suffer irreparable
harm for which monetary damages may be inadequate and thus, the Sub-Adviser
shall be entitled to injunctive relief, as well as any other remedy available
under law.
13. AMENDMENTS TO THE AGREEMENT
Except to the extent permitted by the Investment Company Act or the rules or
regulations thereunder or pursuant to exemptive relief granted by the SEC, this
Agreement may be amended by the parties only if such amendment, if material, is
specifically approved by the vote of a majority of the outstanding voting
securities of the Fund (unless such approval is not required by Section 15 of
the Investment Company Act as interpreted by the SEC or its staff or unless the
SEC has granted an exemption from such approval requirement) and by the vote of
a majority of the Independent Trustees cast in person at a meeting called for
the purpose of voting on such approval.
14. ASSIGNMENT
Any assignment (as that term is defined in the Investment Company Act) of this
Agreement made by the Sub-Adviser without the prior written consent of the
Trust and/or the Adviser shall result in the automatic termination of this
Agreement, as provided in Section 11 hereof. Notwithstanding the foregoing, no
assignment shall be deemed to result from any changes in the directors,
officers or employees of such Sub-Adviser except as may be provided to the
contrary in the Investment Company Act or the rules or regulations thereunder.
The Sub-Adviser agrees that it will notify the Trust and the Adviser of any
changes in its key employees within a reasonable time thereafter.
15. ENTIRE AGREEMENT
This Agreement contains the entire understanding and agreement of the parties
with respect to the Fund.
16. HEADINGS
The headings in the sections of this Agreement are inserted for convenience of
reference only and shall not constitute a part hereof.
17. NOTICES
All notices required to be given pursuant to this Agreement shall be delivered
or mailed to the address listed below of each applicable party in person or by
registered or certified mail or a private mail or delivery service providing
the sender with notice of receipt or such other address
- 12 -
as specified in a notice duly given to the other parties. Notice shall be
deemed given on the date delivered or mailed in accordance with this paragraph.
For: MASSACHUSETTS FINANCIAL SERVICES COMPANY
Xxxx X. Xxxxxxxx, Executive Vice President and General Counsel
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
For: MFS Series Trust XIII
Xxxxx Xxxxxx, Assistant Secretary
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
For: SUN CAPITAL ADVISERS LLC.
Attention: Xxxxx Xxxxxx, Senior Vice President and Chief Counsel
SC1335
One Sun Life Executive Park
Xxxxxxxxx Xxxxx, XX 00000
18. SEVERABILITY
Should any portion of this Agreement for any reason be held to be void in law
or in equity, the Agreement shall be construed, insofar as is possible, as if
such portion had never been contained herein.
19. GOVERNING LAW
This Agreement shall be governed by the laws of the Commonwealth of
Massachusetts, without giving effect to the choice of laws provisions thereof,
except that questions of interpretation shall be resolved in accordance with
the provisions of Section 20 below.
20. INTERPRETATION
Any question of interpretation of any term or provision of this Agreement
having a counterpart in or otherwise derived from a term or provision of the
Investment Company Act shall be resolved by reference to such term or provision
of the Investment Company Act and to interpretations thereof, if any, by the
United States courts or, in the absence of any controlling decision of any such
court, by rules, regulations or orders of the SEC validly issued pursuant to
the Investment Company Act. Specifically, the terms "vote of a majority of the
outstanding voting securities," "interested persons," "assignment," and
"affiliated persons," as used herein shall have the meanings assigned to them
by Section 2(a) of the Investment Company Act. In addition, where the effect of
a requirement of the Investment Company Act reflected in any provision of this
Agreement is relaxed by a rule, regulation or order of the SEC, whether of
special or of general application, such provision shall be deemed to
incorporate the effect of such rule, regulation or order.
- 13 -
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the date first mentioned above.
MASSACHUSETTS FINANCIAL SERVICES COMPANY SUN CAPITAL ADVISERS LLC.
By: XXXXXX X. XXXXXXX By: XXX X. XXXXXXXX
-------------------------------- ------------------------
Name: Xxxxxx X. Xxxxxxx Name: Xxx X. Xxxxxxxx
Title: Chief Executive Officer Title: Senior Vice President
By: XXXXX X. XXXXX
------------------------
Name: Xxxxx X. Xxxxx
Title: SVP, Chief Financial
Officer
MFS SERIES TRUST XIII, on behalf
of the Fund
By: XXXXX X. XXXXXX
-------------------------
Name: Xxxxx X. Xxxxxx
Title: Assistant Secretary
- 14 -
APPENDIX A
TO
INVESTMENT SUB-ADVISORY AGREEMENT
The Adviser shall pay the Sub-Adviser monthly compensation computed daily at an
annual rate equal to the following:
Fund Annual Sub-Advisory Fee
---- --------------------------------
MFS Diversified Income Fund 0.40% of the average daily net
assets of the portion of the
Fund managed by the Sub-Adviser
