EXHIBIT NO. 99.5(a)
INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT, dated this 7th day of August, 1992, by and
between MFS INSTITUTIONAL TRUST, a Massachusetts business trust (the "Trust"),
on behalf of MFS EMERGING EQUITIES FUND, a series of the Trust (the "Fund"), and
MASSACHUSETTS FINANCIAL SERVICES COMPANY, a Delaware corporation (the
"Adviser").
WITNESSETH:
WHEREAS, the Trust is an open-end investment company registered under the
Investment Company Act of 1940 divided into separate series of shares; and
WHEREAS, the Adviser is willing to provide business services to the Trust with
respect 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 Fund 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
for the Fund 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 Trust's Declaration
of 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, as amended (the "1940 Act") and the Rules,
Regulations and orders thereunder, and to the Fund's then-current Prospectus and
Statement of Additional Information (collectively, the "Prospectus"). 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
portfolio securities of the Fund 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
Trust 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.
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 Fund, 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 Trust on behalf of 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 provides that another party is to pay some or all of such
expenses); all such expenses to be allocated among the respective series of the
Trust as provided in Section 6.9 of the Declaration.
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 an annual rate of .75% of the Fund's average
daily net assets of the Fund for its then-current fiscal year. If the Adviser
shall serve for less than the whole of any period specified in this Article 3,
the compensation to the Adviser will be prorated.
ARTICLE 4. 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 principal
underwriter, if any, as principals in making purchases or sales of securities or
other property for the account of the Trust, except as permitted by the 1940 Act
and the Rules, Regulations or orders thereunder, will not take a long or short
position in the shares of the Trust 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 of the Fund relative to the Adviser and its directors
and officers.
ARTICLE 5. 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 Trust, except for willful misfeasance, bad faith or gross negligence in the
performance of its duties or by reason of reckless disregard of its duties and
obligations hereunder. As used in this Section 5, the term "Adviser" shall
include directors, officers and employees of the Adviser as well as that
corporation itself.
ARTICLE 6. 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 Trust agrees that if the
Adviser shall for any reason no longer serve as the Adviser to the Trust, each
of the Trust and 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 Trust as a shareholder or otherwise.
ARTICLE 7. 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 with
respect to the Fund until August 1, 1994 on which date it will terminate with
respect to the Fund unless its continuance after August 1, 1994 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 agreement is approved by "vote of a
majority of the outstanding voting securities" of the Fund.
The terms "specifically approved at least annually," "vote of a majority of the
outstanding voting securities" of the Fund, "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 1940
Act and the Rules and Regulations thereunder, subject, however, to such
exemptions as may be granted by the Securities and Exchange Commission under
said Act.
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, all as of the day and year first written above. The undersigned
Trustee of the Trust has executed this Agreement not individually, but as
Trustee under the Declaration and the obligations of this Agreement are not
binding upon any of the Trustees or shareholders of the Trust, individually, but
bind only the Trust estate.
MFS INSTITUTIONAL TRUST
on behalf of
MFS EMERGING EQUITIES FUND
By: XXXXXXX X. XXXXX
Xxxxxxx X. Xxxxx
Secretary
MASSACHUSETTS FINANCIAL
SERVICES COMPANY
By: XXXXXX X. XXXX, XX.
Xxxxxx X. Xxxx, Xx.
Senior Executive Vice
President and Chief Financial Officer
