EXHIBIT NO. 99.7(d)
AMENDMENT NO. 1 TO CUSTODIAN AGREEMENT
This Amendment No. 1 to the Custodian Agreement is made as of September 30,
2002 by and between each of the business trusts listed on Exhibit A hereto
(each, a "Trust"), and State Street Bank and Trust Company (the "Custodian") and
MFS Service Center, Inc., a Delaware corporation (the "Transfer Agent").
Capitalized terms used in this Amendment without definition shall have the
respective meanings given to such terms in the Custodian Agreement referred to
below.
WHEREAS, each Trust and the Custodian entered into a Custodian Agreement
dated as of July 2, 2001 (as amended and in effect from time to time, the
"Agreement"); and
WHEREAS, the MFS Research Bond Fund J ("RBFJ"), a newly formed series of
MFS Series Trust IX, will primarily invest in shares of the MFS Research Bond
Fund ("RBF"), also a series of MFS Series Trust IX, pursuant to Section
12(d)(1)(E) of the 1940 Act;
WHEREAS, the RBFJ desires to use the Transfer Agent as the functional
equivalent of a securities depositary for its investments in RBF and to have its
interest in RBF shares recorded by book entry on the Transfer Agent's records;
WHEREAS, the staff of the SEC, through a series of no-action letters, has
established conditions under which RBFJ's interest in RBF shares may be
maintained on the Transfer Agent's books, as set forth in Addendum 1 hereto; and
WHEREAS, the parties hereto desire to amend the Agreement to accommodate
this arrangement and any similar arrangement used by the Portfolios;
NOW THEREFORE, in consideration of the foregoing and the mutual covenants
agreements hereinafter contained, the parties hereby agree to amend the
Agreement, pursuant to the terms thereof, as follows:
1. Section 2. Employment of Custodian and Property to be Held by It.
Section 2 of the Agreement is hereby amended by adding the following
sentence to the end of the first paragraph:
"With respect to uncertificated shares (the "Underlying Shares") of
registered investment companies, the maintenance of Custodian records
that identify the Underlying Shares as being recorded in the
Custodian's name on behalf of the Portfolios will be deemed custody
for purposes hereof."
2. Section 3. Duties of the Custodian with Respect to Property of the Trusts
held by the Custodian in the United States.
Section 3 of the Agreement is hereby amended by adding the following
provision:
"Section 3.9A Deposit of Fund Assets with the Transfer Agent.
Underlying Shares may be deposited and/or maintained in an account or
accounts maintained with the Transfer Agent. The Transfer Agent shall
be deemed to be acting as if it is a "securities depository" for
purposes of Rule 17f-4 under the 1940 Act. The Trust hereby directs
the Custodian to deposit and/or maintain such securities with the
Transfer Agent, subject to the following provisions:
1) The Custodian shall keep Underlying Shares owned by a Portfolio
with the Transfer Agent provided that such securities are
maintained in a separate account or accounts on the books and
records of the Transfer Agent in the name of the Custodian as
custodian for the Portfolio.
2) The records of the Custodian with respect to the Underlying
Shares which are maintained with the Transfer Agent shall
identify by book-entry those Underlying Shares belonging to the
Portfolio.
3) The Custodian shall pay for Underlying Shares purchased for the
account of a Portfolio upon (i) a determination by the Custodian
that such Underlying Shares have been purchased and will be
transferred to the account of the Custodian, on behalf of the
Portfolio, on the books and records of the Transfer Agent, and
(ii) the making of an entry on the records of the Custodian to
reflect such payment and transfer for the account of the
Portfolio. The Trust acknowledges that the Custodian will only
pay for Underlying Shares under this Section on the basis of
standing or periodic Proper Instructions. The Custodian shall
receive confirmation from the Transfer Agent of the purchase of
such securities and the transfer of such securities to the
Custodian's account with the Transfer Agent only after such
payment is made. The Custodian shall transfer Underlying
Securities redeemed for the account of a Portfolio (i) upon a
determination by the Custodian that such securities have been
redeemed and that payment for such securities will be transferred
to the Custodian, and (ii) the making of an entry on the records
of the Custodian to reflect such transfer and payment for the
account of the Portfolio. The Custodian will receive confirmation
from the Transfer Agent of the redemption of such securities and
payment
therefore only after such securities are redeemed. Copies of all
trade summary sheets from the Custodian reflecting purchases and
sales of Underlying Shares for the account of the Portfolio shall
identify the Portfolio, be maintained for the Portfolio by the
Custodian, and shall be provided upon request to the Trust on
behalf of the Portfolio, together with any daily or other
periodic transaction sheets reflecting each day's transactions
for a Portfolio as reflected on the books and records of the
Transfer Agent. The Custodian shall deliver to the Trust such
reports on its system of internal accounting controls as the
Trust may from time to time request.
4) The Custodian shall not be liable to the Trust or any Portfolio
for any loss or damage to the Trust or any Portfolio resulting
from maintenance of Underlying Shares with the Transfer Agent
except for losses resulting directly from the negligence,
misfeasance or misconduct of the Custodian or any of its agents
or of any of its or their employees.
5) The Trust, on behalf of the Portfolio, the Transfer Agent and the
Custodian shall comply with the conditions set forth in Addendum
1 hereto, so long as those conditions are required to be complied
with by the SEC or the staff of the SEC."
2. Continuing Agreement.
Except as expressly amended by the Amendment No. 1 to Custodian Agreement,
the provisions of the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment
No. 1 to Custodian Agreement to be executed in its name and behalf by its duly
authorized representative(s) as of the date first written above.
EACH OF THE ENTITIES SET FORTH ON
EXHIBIT A TO THE CUSTODIAN AGREEMENT
By: XXXXX X. XXXXXXXXX, XX.
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Name: Xxxxx X. Xxxxxxxxx, Xx.
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Title: Assistant Secretary and Assistant
Clerk
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STATE STREET BANK AND TRUST COMPANY
By: XXXXXX X. XXXXXX
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Name: Xxxxxx X. Xxxxxx
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Title: Executive Vice President
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MFS SERVICE CENTER, INC.
By: XXXXX X. XXXXXXXX
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Name: Xxxxx X. Xxxxxxxx
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Title: President
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Addendum 1
Conditions Required by Staff of SEC
Portfolio Conditions
1. The Portfolio must maintain a system that is reasonably designed to prevent
unauthorized officers' instructions and which will provide, at least, for
the form, content, and means of giving, recording and reviewing the
instructions.
2. The Board of Trustees overseeing the Portfolio must approve the arrangement
with the Transfer Agent and review it as appropriate.
3. The number of persons authorized to transmit instructions by or on behalf
of the Portfolio to the Transfer Agent must be limited (e.g., to 5).
4. Persons transmitting instructions by or on behalf of the Portfolio to the
Transfer Agent must use passwords to insure that they are properly
authorized.
5. Internal accounting controls by or on behalf of the Portfolio must be
employed that subject all transaction sheets reflecting purchase,
redemption or exchange activity by the Portfolio and maintained by the
Transfer Agent to daily proof against the Portfolio's transaction
authorizations.
6. The Portfolio's independent accountants must perform at least three
verifications of the Portfolio's investments, at least two of which must be
performed without prior notice to the Portfolio.
Transfer Agent Conditions
7. The Transfer Agent must transmit daily transaction sheets reflecting
purchase, redemption or exchange activity by the Portfolio to someone at
the Portfolio or someone acting on the Portfolio's behalf who is not the
same person who transmitted the instruction to the Transfer Agent.
8. The Transfer Agent must maintain segregated accounts representing any
assets held for the Custodian.
Custodian Conditions
9. The Custodian must maintain the Portfolio's securities (i.e., investment in
Underlying Shares) directly with the Transfer Agent in a separate account
in its name.
10. The Custodian must send to the Portfolio or someone acting on behalf of the
Portfolio copies of all transaction sheets reflecting purchase, redemption
or exchange activity by the Portfolio received from the Transfer Agent of
any transfer to or from the account of the Portfolio.
11. The Custodian must send to the Portfolio or someone acting on behalf of the
Portfolio reports regarding the Custodian's system of internal accounting
control as the Portfolio or someone acting on behalf of the Portfolio may
reasonably request from time to time.
