Exhibit No.99.5(e)
FORM OF
INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT, dated this 30th day of November, 1995, by and
between MFS INSTITUTIONAL TRUST, a Massachusetts business trust (the "Trust"),
on behalf of MFS INSTITUTIONAL RESEARCH FUND, a series of the Trust (the
"Fund"), and MASSACHUSETTS FINANCIAL SERVICES COMPANY, a Delaware corporation
(the "Adviser").
WITNESSETH:
WHEREAS, the Trust is engaged in business as an open-end investment company
registered under the Investment Company Act of 1940; and
WHEREAS, the Adviser is willing to provide business services to the Fund on the
terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements of the
parties hereto as herein set forth, the parties covenant and agree as follows:
ARTICLE 1. Duties of the Adviser. The Adviser shall provide the Fund with such
investment advice and supervision as the latter may from time to time consider
necessary for the proper supervision of its funds. The Adviser shall act as
adviser to the Fund and as such shall furnish continuously an investment program
and shall determine from time to time what securities shall be purchased, sold
or exchanged and what portion of the assets of the Fund shall be held
uninvested, subject always to the restrictions of the Declaration of Trust of
the Trust, dated September 13, 1990, and By-Laws, each as amended from time to
time (respectively, the "Declaration" and the "By-Laws"), to the provisions of
the Investment Company Act of 1940 and the Rules, Regulations and orders
thereunder and to the Fund's then-current Prospectus and Statement of Additional
Information, as amended or supplemented from time to time. The Adviser shall
also make recommendations as to the manner in which voting rights, rights to
consent to corporate action and any other rights pertaining to the Fund's
portfolio securities shall be exercised. Should the Trustees at any time,
however, make any definite determination as to the investment policy and notify
the Adviser thereof in writing, the Adviser shall be bound by such determination
for the period, if any, specified in such notice or until similarly notified
that such determination shall be revoked. The Adviser shall take, on behalf of
the Fund, all actions which it deems necessary to implement the investment
policies determined as provided above, and in particular to place all orders for
the purchase or sale of portfolio securities for the Fund's account with brokers
or dealers selected by it, and to that end, the Adviser is authorized as the
agent of the Fund to give instructions to the Custodian of the Fund as to the
deliveries of securities and payments of cash for the account of the Fund. In
connection with the selection of such brokers or dealers and the placing of such
orders, the Adviser is directed to seek for the Fund execution at the most
reasonable price by responsible brokerage firms at reasonably competitive
commission rates. In fulfilling this requirement the 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 its having caused the Fund to pay a broker or
dealer an amount of commission for effecting a securities transaction in excess
of the amount of commission another broker or dealer would have charged for
effecting that transaction, if the Adviser determined in good faith that such
amount of commission was reasonable in relation to the value of the brokerage
and research services provided by such broker or dealer, viewed in terms of
either that particular transaction or the Adviser's overall responsibilities
with respect to the Fund and to other clients of the Adviser as to which the
Adviser exercises investment discretion.
The Adviser may from time to time enter into sub-investment advisory agreements
with one or more investment advisers with such terms and conditions as the
Adviser may determine, provided that such sub-investment advisory agreements
have been approved by a majority of the Trustees of the Trust who are not
"interested persons" of the Trust, the Adviser or the sub-adviser and by "vote
of a majority of the outstanding voting securities" of the Fund. Subject to the
provisions of Article 6, the Adviser shall not be liable for any error of
judgment or mistake of law by any sub-adviser or for any loss arising out of any
investment made by any sub-adviser or for any act or omission in the execution
and management of the Fund by any sub-adviser.
ARTICLE 2. Allocation of Charges and Expenses. The Adviser shall furnish at its
own expense investment advisory and administrative services, office space,
equipment and clerical personnel necessary for servicing the investments of the
Fund and maintaining its organization, and investment advisory facilities and
executive and supervisory personnel for managing the investments and effecting
the portfolio transactions of the Fund. The Adviser shall arrange, if desired by
the Trust, for Directors, officers and employees of the Adviser to serve as
Trustees, officers or agents of the Trust if duly elected or appointed to such
positions and subject to their individual consent and to any limitations imposed
by law. It is understood that the Fund will pay all of its own expenses
including, without limitation, compensation of Trustees not affiliated with the
Adviser; governmental fees; interest charges; taxes; membership dues in the
Investment Company Institute allocable to the Fund; fees and expenses of
independent auditors, of legal counsel, and of any transfer agent, registrar or
dividend disbursing agent of the Fund; expenses of repurchasing and redeeming
shares and servicing shareholder accounts; expenses of preparing, printing and
mailing stock certificates, shareholder reports, notices, proxy statements and
reports to governmental officers and commissions; brokerage and other expenses
connected with the execution, recording and settlement of portfolio security
transactions; insurance premiums; fees and expenses of the custodian for all
services to the Fund, including safekeeping of funds and securities and
maintaining required books and accounts; expenses of calculating the net asset
value of shares of the Fund; expenses of shareholders' meetings; and expenses
relating to the issuance, registration and qualification of shares of the Fund
and the preparation, printing and mailing of prospectuses for such purposes
(except to the extent that any Distribution Agreement to which the Trust is a
party on behalf of the Fund provides that another party is to pay some or all of
such expenses).
ARTICLE 3. Compensation of the Adviser. For the services to be rendered and the
facilities provided, the Fund shall pay to the Adviser an investment advisory
fee computed and paid monthly at a rate equal to 0.60% of the Fund's average
daily net assets on an annualized basis.
The Adviser agrees to pay until December 31, 2005, expenses of the
Trust (except for fees paid under this Agreement or the Fund's Distribution
Plan) such that the Fund's aggregate operating expenses shall not exceed 0.75%
per annum of the average daily net assets of the Fund; provided, however, that
this obligation may be terminated or revised at any time by the Adviser without
the consent of the Fund by notice in writing from the Adviser to the Fund,
provided that such termination or revision will not be effective with respect to
the fiscal year within which such notice is given. Such payments by the Adviser
are subject to reimbursement by the Fund, which will be accomplished by the
payment by the Fund of an expense reimbursement fee to the Adviser computed and
paid monthly at a percentage of the average daily net assets of the Fund for its
then current fiscal year, with a limitation that immediately after such payment
the aggregate operating expenses of the Fund would not exceed 0.75% of its
average daily net assets. This expense reimbursement terminates for the Fund on
the earlier of the date on which payments made thereunder by such Fund equal the
prior payment of such reimbursable expenses by the Adviser or December 31, 2005.
If the Adviser shall serve for less than the whole of any period
specified in this Article 3, the compensation payable to the Adviser with
respect to the Fund will be prorated.
ARTICLE 4. Special Services. Should the Trust have occasion to request the
Adviser to perform services not herein contemplated or to request the Adviser to
arrange for the services of others, the Adviser will act for the Trust on behalf
of the Fund upon request to the best of its ability, with compensation for the
Adviser's services to be agreed upon with respect to each such occasion as it
arises.
ARTICLE 5. Covenants of the Adviser. The Adviser agrees that it will not deal
with itself, or with the Trustees of the Trust or the Trust's distributor, if
any, as principals in making purchases or sales of securities or other property
for the account of the Fund, except as permitted by the Investment Company Act
of 1940 and the Rules, Regulations or orders thereunder, will not take a long or
short position in the shares of the Fund except as permitted by the Declaration
and will comply with all other provisions of the Declaration and the By-Laws and
the then-current Prospectus and Statement of Additional Information of the Fund
relative to the Adviser and its Directors and officers.
ARTICLE 6. Limitation of Liability of the Adviser. The Adviser shall not be
liable for any error of judgment or mistake of law or for any loss arising out
of any investment or for any act or omission in the execution and management of
the Fund, except for willful misfeasance, bad faith or gross negligence in the
performance of its duties and obligations hereunder. As used in this Section 6,
the term "Adviser" shall include Directors, officers and employees of the
Adviser as well as that corporation itself.
ARTICLE 7. Activities of the Adviser. The services of the Adviser to the Fund
are not deemed to be exclusive, the Adviser being free to render investment
advisory and/or other services to others. The Adviser may permit other fund
clients to use the initials "MFS" in their names. The Fund agrees that if the
Adviser shall for any reason no longer serve as the Adviser to the Fund, the
Fund will change its name so as to delete the initials "MFS". It is understood
that the Trustees, officers and shareholders of the Trust are or may be or
become interested in the Adviser, as Directors, officers, employees, or
otherwise and that Directors, officers and employees of the Adviser are or may
become similarly interested in the Trust, and that the Adviser may be or become
interested in the Fund as a shareholder or otherwise.
ARTICLE 8. Duration, Termination and Amendment of this Agreement. This Agreement
shall become effective on the date first above written and shall govern the
relations between the parties hereto thereafter, and shall remain in force until
August 1, 1997 on which date it will terminate unless its continuance after
August 1, 1998 is "specifically approved at least annually" (i) by the vote of a
majority of the Trustees of the Trust who are not "interested persons" of the
Trust or of the Adviser at a meeting specifically called for the purpose of
voting on such approval, and (ii) by the Board of Trustees of the Trust, or by
"vote of a majority of the outstanding voting securities" of the Fund.
This Agreement may be terminated at any time without the payment of any penalty
by the Trustees or by "vote of a majority of the outstanding voting securities"
of the Fund, or by the Adviser, in each case on not more than sixty days' nor
less than thirty days' written notice to the other party. This Agreement shall
automatically terminate in the event of its "assignment."
This Agreement may be amended only if such amendment is approved by "vote of a
majority of the outstanding voting securities" of the Fund.
ARTICLE 9. Scope of Trust's Obligations. A copy of the Trust's Declaration of
Trust is on file with The Secretary of State of the Commonwealth of
Massachusetts. The 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. If this Agreement is executed by the Trust on
behalf of one or more series of the Trust, the Adviser 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.
ARTICLE 10. Definitions. The terms "specifically approved at least annually,"
"vote of a majority of the outstanding voting securities," "assignment,"
"affiliated person," and "interested person," when used in this Agreement, shall
have the respective meanings specified, and shall be construed in a manner
consistent with, the Investment Company Act of 1940 and the Rules and
Regulations promulgated thereunder, subject, however, to such exemptions as may
be granted by the Securities and Exchange Commission under said Act.
ARTICLE 11. Record Keeping. The Adviser will maintain records in a form
acceptable to the Trust and in compliance with the rules and regulations of the
Securities and Exchange Commission, including but not limited to records
required to be maintained by Section 31(a) of the Investment Company Act of 1940
and the rules thereunder, which at all times will be the property of the Trust
and will be available for inspection and use by the Trust.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered in their names and on their behalf by the undersigned, thereunto duly
authorized, and their respective seals to be hereto affixed, all as of the day
and year first written above. The undersigned officers of the Trust and the
Adviser have executed this Agreement not individually, but as officers of the
Trust and the Adviser, respectively.
MFS INSTITUTIONAL TRUST
on behalf of
MFS INSTITUTIONAL RESEARCH FUND,
one of its series
By:____________________________
A. Xxxxx Xxxxxxx
Chairman, and not individually
MASSACHUSETTS FINANCIAL
SERVICES COMPANY
By:_______________________________
Xxxxxx X. Xxxxx
Senior Executive Vice President, and
not individually
