EXHIBIT NO. 99(g)(2)
MASTER ADMINISTRATIVE SERVICES AGREEMENT
MASTER ADMINISTRATIVE SERVICES AGREEMENT dated this 1st day of March, 1997, 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 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 Advisory Agreements recite that the Administrator will bear certain
expenses associated with the provision of investment advisory services and that
the Funds will bear their own expenses, including expenses of legal counsel to
the Funds, expenses connected with the execution, recording and settlement of
the Funds' portfolio security transactions and expenses of calculating the
Funds' net asset values;
WHEREAS, the Administrator, at its expense, has provided a variety of
administrative services to the Funds for the benefit of the Funds and their
shareholders; and
WHEREAS, the Funds desire to retain the Administrator to render certain legal,
financial administration and other administrative services to 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. Subject to the limitations set forth in the second
paragraph of Section 3 of this Agreement, the Administrator shall render to each
Fund the financial administration services set forth on Exhibit B hereto (the
"Financial Administration Services"), the legal services set forth on Exhibit C
hereto (the "Legal Services") and the other administrative services set forth on
Exhibit D hereto ("Other Administrative Services") (the Financial Administration
Services, Legal Services and Other Administrative Services are collectively
referred to as the "Administrative Services").
The Administrative Services provided by the Administrator to each Fund
may not include all Administrative Services required by the Fund, due to a
number of considerations, including, without limitation, the Administrator's
level of work flow, staffing and resources, the specialized or unique nature of
the Administrative Services and the relative priorities of such Administrative
Services. The Administrator may, on behalf of each Fund, arrange for or engage
outside legal counsel, accounting or auditing firm or any other outside service
provider or vendor
(collectively, "third party vendors") to perform Administrative Services for the
Fund, and the Fund will bear the expense of any such third party vendors;
provided however, that the Administrator shall promptly inform the Fund's
governing board in the event any third party vendor is engaged to perform
Administrative Services for a Fund on a basis that is expected to generate
significant expenses for a Fund.
2. Maintenance of Books and Records. With respect to the provision of
Administrative Services, the Administrator will preserve for each Fund that is
registered as a registered 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 therefor,
to the Fund's Board of Trustees or auditors 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.
3. Administrative Fee. Each Fund shall pay the Administrator a fee as agreed to
from time to time and as set forth in Exhibit E 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.
The governing board of each Fund will, on an annual basis, review the
services provided, the Administrator's costs in providing such services, amounts
paid to third party vendors pursuant to the arrangement described in Section 1
and the amount paid by the Fund to the Administrator pursuant to this Agreement
(including the extent to which such amount is greater or lesser than the
Administrator's costs in providing such services) and such other information as
such board may reasonably request.
4. Scope of Administrative Services; Regulatory and Business and Industry
Practice Developments. The Administrative Services to be furnished by the
Administrator include only those services required by a Fund or which are being
furnished by the Administrator at March 1, 1997. In the event that, subsequent
to March 1, 1997, because of regulatory developments, or new or modified
business or industry practices, the Fund requires services in addition to the
Administrative Services, at the request of the Fund, the Administrator will
consider furnishing such additional services, with compensation for such
additional services to be agreed upon with respect to each such occasion as it
arises.
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5. 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.
6. 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) in the case of Financial Administration
Services, negligence, and, in the case of Legal Services and Other
Administrative Services, gross negligence, in each case on the Administrator's
part or (d) from reckless disregard by the Administrator of its obligations and
duties under this Agreement.
7. Term, Termination, Amendment and Assignment. This Agreement shall begin on
the date first written above and shall continue indefinitely. The Agreement may
be terminated at any time, without payment of any penalty, by the Board of
Directors/Trustees which oversees the Fund upon sixty (60) days' written notice
to the Administrator. This Agreement may be terminated by the Administrator with
respect to any Fund at any time upon sixty (60) days' written notice to the
Fund. 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.
8. 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
Administration 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
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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 the 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, 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.
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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 Family of Funds,
MFS Closed-End Funds and MFS
Institutional Funds listed on Exhibit A
hereto
By:/S/ A. XXXXX XXXXXXX
A. Xxxxx Xxxxxxx
Chairman and President
On behalf of the MFS/Sun Life Series
Trust and Compass Products listed on
Exhibit A hereto
By:/S/ XXXX X. XXXXXX
Xxxx X. XxXxxx
Chairman
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By:/S/ XXXXXXX X. XXXXXX
Xxxxxxx X. Xxxxxx
President
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Exhibit A
Funds
I. MFS Family of Funds
MFS Series Trust I:
MFS Managed Sectors Fund
MFS Cash Reserve Fund
MFS World Asset Allocation Fund
MFS Special Opportunities Fund
MFS Aggressive Growth Fund
MFS Research Growth and Income Fund
MFS Equity Income Fund
MFS Core Growth Fund
MFS Convertible Securities Fund
MFS Blue Chip Fund
MFS New Discovery Fund
MFS Science & Technology Fund
MFS Research International Fund
MFS Series Trust II:
MFS Emerging Growth Fund
MFS Capital Growth Fund
MFS Gold & Natural Resources Fund
MFS Intermediate Income Fund
MFS Series Trust III:
MFS High Income Fund
MFS Municipal High Income Fund
MFS Series Trust IV:
MFS Money Market Fund
MFS Government Money Market Fund
MFS Municipal Bond Fund
MFS OTC Fund
MFS Series Trust V:
MFS Total Return Fund
MFS Research Fund
MFS Series Trust VI:
MFS World Total Return Fund
MFS Utilities Fund
MFS World Equity Fund
MFS Series Trust VII:
MFS World Governments Fund
MFS Value Fund
MFS Series Trust VIII:
MFS Strategic Income Fund
MFS World Growth Fund
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MFS Series Trust IX:
MFS Bond Fund
MFS Limited Maturity Fund
MFS Municipal Limited Maturity Fund
MFS Series Trust X:
MFS Government Mortgage Fund
MFS/Foreign & Colonial Emerging Markets Equity Fund
MFS/Foreign & Colonial International Growth Fund
MFS/Foreign & Colonial International Growth and Income Fund
MFS Municipal Series Trust:
MFS Alabama Municipal Bond Fund
MFS Arizona Municipal Bond Fund
MFS California Municipal Bond Fund
MFS Florida Municipal Bond Fund
MFS Georgia Municipal Bond Fund
MFS Maryland Municipal Bond Fund
MFS Massachusetts Municipal Bond Fund
MFS Mississippi Municipal Bond Fund
MFS New York Municipal Bond Fund
MFS North Carolina Municipal Bond Fund
MFS Pennsylvania Municipal Bond Fund
MFS South Carolina Municipal Bond Fund
MFS Tennessee Municipal Bond Fund
MFS Virginia Municipal Bond Fund
MFS West Virginia Municipal Bond Fund
MFS Municipal Income Fund
MFS Growth Opportunities Fund
MFS Government Securities Fund
Massachusetts Investors Growth Stock Fund
MFS Government Limited Maturity Fund
Massachusetts Investors Trust
II. MFS Closed-End Funds
MFS Municipal Income Trust
MFS Multimarket Income Trust
MFS Government Markets Income Trust
MFS Intermediate Income Trust
MFS Charter Income Trust
MFS Special Value Trust
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III. MFS Institutional Funds
MFS Institutional Trust:
MFS Institutional Emerging Equities Fund
MFS Institutional Worldwide Fixed Income Fund
MFS Institutional Emerging Markets Income Fund
MFS Institutional International Equity Fund
MFS Institutional Mid-Cap Growth Equity Fund
MFS Institutional Research Fund
MFS Institutional Core Plus Fixed Income Fund
MFS Union Standard Trust:
MFS Union Standard Equity Fund
MFS Variable Insurance Trust:
MFS Emerging Growth Series
MFS Value Series
MFS Research Series
MFS Growth With Income Series
MFS Total Return Series
MFS Utilities Series
MFS High Income Series
MFS World Governments Series
MFS Strategic Fixed Income Series
MFS Bond Series
MFS Limited Maturity Series
MFS Money Market Series
IV. MFS/Sun Life Series Trust
MFS Capital Appreciation Series
MFS Conservative Growth Series
MFS Government Securities Series
MFS World Governments Series
MFS High Yield Series
MFS Managed Sectors Series
MFS Money Market Series
MFS Total Return Series
MFS Utilities Series
MFS World Growth Series
MFS Zero Coupon Series 2000
MFS Research Series
MFS World Asset Allocation Series
MFS World Total Return Series
MFS Emerging Growth Series
MFS/Foreign & Colonial International Growth and Income Series
MFS/Foreign & Colonial International Growth Series
MFS/Foreign & Colonial Emerging Markets Equity Series
MFS Value Series
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V. Compass Products
MFS Capital Appreciation Variable Account
MFS Government Securities Variable Account
MFS World Governments Variable Account
MFS High Yield Variable Account
MFS Managed Sectors Variable Account
MFS Money Market Variable Account
MFS Total Return Variable Account
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Exhibit B
Financial Administration Services
The Administrator shall perform the following Financial Administration
Services for each Fund:
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 governing board
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 notify 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.
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 governing body. The Administrator may use one or more
external pricing services in computing the value of a Fund's securities,
including broker/dealers, provided that the Fund's governing body or an
individual designated by the Fund's governing body has approved the use of such
pricing services.
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
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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 governing board.
D. Other Financial Administration Services. In addition, the
Administrator shall provide the following Financial Administration
Services:
(1) Provide Treasurers or Assistant Treasurers to serve
as officers of the Fund;
(2) Coordinate the meetings of the Audit Committees, 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, transfer agent
fees and the fees of other service providers to the Fund;
(4) Oversee the preparation of accounting records
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. Assure that all statements and disclosures are in
accordance with generally accepted accounting principles and
that disclosures meet current regulatory or accounting
requirements;
(6) 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
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) Complete materials for the governing board of the Fund,
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; and
(10) Perform or arrange for the performance of all other
Financial Administration Services required of the
Fund.
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Exhibit C
Legal Services
The Administrator shall provide the following Legal Services to each
Fund:
A. Organizational Matters and Initial Registration. The
Administrator shall perform the following functions relating to the
organization and initial registration of the Fund:
Draft and file with appropriate regulatory authorities
the Fund's charter documents;
Draft, negotiate and file with appropriate regulatory
authorities the Fund's service contracts;
Prepare and file the Fund's registration statement or other
similar registration documentation with appropriate regulatory
authorities (the "Registration Statement") and negotiate with such
regulatory authorities; and
Otherwise arrange for and oversee registration and qualification
of the Fund's shares.
B. Ongoing Regulatory Filings, Reports and Meetings. The Administrator shall
perform the following functions relating to ongoing regulatory filings, reports
and meetings of the Fund:
Prepare and file with appropriate regulatory
authorities amendments to the Fund's Registration
Statement;
Prepare and file with appropriate regulatory authorities
supplements to the Fund's prospectus and statement of additional
information;
Design and write documents or materials required to be prepared
by or on behalf of the Fund for distribution to shareholders of
the Fund, the Fund's governing board and officers and any
governmental officers or commissions as required of the Fund and
not otherwise provided for under this Agreement including, without
limitation, prospectuses, shareholder reports, shareholder notices
and proxy statements;
Prepare and file or oversee preparation and review and provide
legal guidance on the Fund's annual, semi-annual and other
periodic reports;
Prepare and file or oversee preparation and provide
legal guidance on the Fund's tax filings and reports;
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Prepare and file with appropriate regulatory authorities the
Fund's proxy statement and negotiate with such regulatory
authorities;
Prepare and file with appropriate regulatory authorities various
reports in order to maintain the Fund's status in good standing;
Arrange for shareholders' meetings;
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, shareholder minutes and any follow-up documents; and
Attend shareholder meetings.
C. Securities Trading and Investment Practices. The Administrator shall perform
the following functions relating to the Fund's securities trading and investment
practices:
Review and negotiate private placement and municipal securities
offering documentation and provide legal guidance on transfer
restrictions;
Provide guidance on legal considerations relating to
the purchase of foreign securities;
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;
Negotiate the Fund's line of credit documentation; and
Provide legal guidance on applicable laws regulating the types
and levels of ownership of securities by the Fund.
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.
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E. Tax Considerations. The Administrator shall perform the
following functions relating to the application of tax rules to the
Fund:
Provide legal guidance with respect to the application of tax
rules to the Fund and analyze from a tax perspective new types of
securities purchased by the Fund, new investment practices engaged
in by the Fund and new investment products or practices adopted by
the Fund; and
Draft and/or review sections of the Fund's prospectus describing
the tax consequences of an investment in the Fund.
F. Board Considerations. The Administrator shall perform the following functions
with respect to the Fund's governing board:
Provide advice concerning applicable rules governing
the composition of the Fund's governing board;
Coordinate, prepare materials for and attend board and
committee meetings and coordinate any follow up issues;
and
Provide guidance and prepare materials on legal issues relevant
to the Fund's business.
G. Miscellaneous/Extraordinary Events. The Administrator shall perform the
following miscellaneous functions for the Fund:
Provide legal guidance with respect to litigation brought by the
Fund and against the Fund and negotiate litigation settlements and
pre-litigation settlements and work-out arrangements;
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;
Provide legal guidance on alternative distribution structures for
the Fund's shares (such as the adoption of a multiple class
structure);
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 legal
opinions and regulatory authority rulings necessary for such
transactions to comply with applicable law;
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Seek formal guidance from regulatory authorities concerning the
application of various regulations to the Fund and seek exemptive
relief where appropriate; and
Provide or arrange for all other Legal Services required of the
Fund and not otherwise provided for under this Agreement other
than the services of any counsel retained to represent the members
of the governing boards of the funds who are not "interested
persons" of the Administrator or its affiliates, as such term is
defined in the Investment Company Act of 1940.
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Exhibit D
OTHER ADMINISTRATIVE SERVICES
The Administrator shall provide the following Other Administrative
Services to each Fund:
(1) Arrange for persons or other entities to serve as transfer
agent, registrar or dividend disbursing agent as required by the
Fund;
(2) Arrange for a line of credit in the event of an
unanticipated redemption of shares;
(3) Arrange for consideration by the Board of
appropriate or necessary insurance coverage for the
Fund;
(4) Subject to Section 4 hereof, perform or arrange for
all compliance functions required of the Fund;
(5) Prepare, and arrange for the printing and mailing
of, any necessary investment communications;
(6) 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;
(7) Arrange for any other printing, production and delivery services
required of the Fund and not otherwise provided for under this
Agreement;
(8) 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;
(9) Review the Fund's disclosure documents to ensure that
disclosures and policies conform to the Fund's actual operation;
and
(10) Provide for the calculation and timely disbursement of
appropriate regulatory authority registration fees.
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Exhibit E
ADMINISTRATIVE FEE
The Administrative Fee shall be an amount, computed as set forth below,
designed to reimburse the Administrator for its actual costs (excluding costs of
staffing so-called residual matters as set forth in Exhibit #2 to Exhibit H to
the Memorandum to the Trustees of the Funds from Xxxxxxx X. Xxxxx and Xxxxxx X.
Xxxxx Xxxxx dated September 23, 1996 (Offshore Board) or October 1, 1996
(Compass, Crimson, Institutional Products and Red Boards)) for providing the
Financial Administration Services and Legal Services (the "Actual Costs") for
providing such services for a calendar year computed pursuant to the principles
set forth in such Exhibit H, subject to such changes in those principles as may
be agreed to from time to time by the Funds and the Administrator (the "Approved
Budgeted Costs"). In computing its Actual Costs, the Administrator will follow
the cost allocation principles set forth in the Deloitte & Touche LLP Report of
Independent Consultant dated November 29, 1996 under the caption "Review of MFS
Cost Reimbursement Methodologies", subject to such changes as may be agreed to
from time to time by the Funds and the Administrator.
For calendar year 1997, the Approved Budgeted Costs are agreed to be
$5.5 million, such amount to be pro rated from the effective date of this
Agreement. For each subsequent calendar year, the Approved Budgeted Costs shall
be an amount agreed to by the Funds and the Administrator prior to the beginning
of the year, provided that, until Approved Budgeted Costs for a year are agreed
to, the Approved Budgeted Costs and Administrative Fee for the prior year shall
remain in effect.
Subject to the adjustments required by the next paragraph, the
Administrative Fee for a calendar year shall be computed by allocating the
Approved Budgeted Costs for that year among the Funds based on each Fund's
average daily net assets for its then-current fiscal year at rates reflecting a
basic rate on the first $1 billion of net assets of a Fund, a 16 2/3% discount
from the basic rate on the next $1 billion, a 33 1/3% discount from the basic
rate on the next $1 billion, and the elimination of any charge on assets in
excess of $3 billion. For 1997 the rates shall be:
0.0150% on first $1 billion;
0.0125% on next $1 billion;
0.0100% on next $1 billion;
0.0% on amounts in excess of $ 3 billion
in each case on an annualized basis for a Fund's then-current fiscal
year.
In the event that the aggregate amount of all Administrative Fees
received by the Administrator during a calendar year at any time equals 110% of
the amount of the Approved Budgeted Costs for that year, no further payments of
Administrative Fees shall be made by the Funds to the Administrator for that
calendar year. In the event that the aggregate amount of the
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Administrative Fees received by the Administrator for a calendar year is less
than the amount of the Approved Budgeted Costs for that year, the Administrator
shall not be entitled to recovery of this shortfall during the current calendar
year; however, the amount of such shortfall will be taken into account when
establishing the Administrative Fee for following calendars years. In the event
that the aggregate amount of the Administrative Fees received by the
Administrator for a calendar year is greater than the Administrator's Actual
Costs for that year, such excess fees shall be applied as a credit against the
Administrative Fees payable by the Funds hereunder for the subsequent calendar
year.
The Administrator will provide the Funds with such information as may
reasonably be required to review the Administrator's Actual Costs as of June 30
and December 31 in each year.
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