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MFS/FOREIGN & COLONIAL INTERNATIONAL GROWTH FUND
MFS/FOREIGN & COLONIAL INTERNATIONAL GROWTH AND INCOME FUND
MFS/FOREIGN & COLONIAL EMERGING MARKETS EQUITY FUND
SUPPLEMENT TO THE OCTOBER 1, 1996 PROSPECTUS AND
STATEMENT OF ADDITIONAL INFORMATION
THE FOLLOWING INFORMATION SHOULD BE READ IN CONJUNCTION WITH THE FUNDS'
PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION ("SAI"), DATED OCTOBER 1,
1996, AND CONTAINS A DESCRIPTION OF CLASS I SHARES.
CLASS I SHARES ARE AVAILABLE FOR PURCHASE ONLY BY CERTAIN INVESTORS AS
DESCRIBED UNDER THE CAPTION "ELIGIBLE PURCHASERS" BELOW.
EXPENSE SUMMARY
CLASS I
INTERNATIONAL EMERGING
INTERNATIONAL GROWTH AND MARKETS
GROWTH FUND INCOME FUND EQUITY FUND
SHAREHOLDER TRANSACTION EXPENSES:
Maximum Initial Sales Charge Imposed
on Purchases of Fund Shares (as a
percentage of offering price)..... None None None
Maximum Contingent Deferred Sales
Charge (as a percentage of original
purchase price or redemption proceeds,
as applicable)..................... None None None
INTERNATIONAL EMERGING
INTERNATIONAL GROWTH AND MARKETS
GROWTH FUND INCOME FUND EQUITY FUND
ANNUAL OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE DAILY NET ASSETS):
Management Fees.................... 0.975% 0.975% 1.25%
Rule 12b-1 Fees.................... None None None
Other Expenses (after expense
reimbursement)(1)(2).............. 0.765% 1.045% 0.75%(3)
----- ----- ----
Total Operating Expenses (after
expense reimbursement)........... 1.74% 2.02% 2.00%(3)
...............
(1) "Other Expenses" is based on Class A expenses incurred during the period
ended May 31, 1996.
(2) Each Fund has an expense offset arrangement which reduces the Fund's
custodian fee based upon the amount of cash maintained by the Fund with its
custodian and dividend disbursing agent, and may enter into other such
arrangements and directed brokerage arrangements (which would also have the
effect of reducing the Fund's expenses). Any such fee reductions are not
reflected under "Other Expenses."
(3) MFS has agreed to bear, subject to reimbursement by the Emerging Markets
Equity Fund, until December 31, 2005, expenses of Class I shares of the
Fund such that the aggregate expenses of the Emerging Markets Equity Fund
do not exceed 2.00% of the Fund's average daily net assets attributable to
Class I shares on an annualized basis. This arrangement may be terminated
or revised by MFS at any time. (See "Other Information" below.) Absent this
expense arrangement, estimated "Other Expenses" and "Total Operating
Expenses" for the Emerging Markets Equity Fund's Class I shares would be
1.17% and 2.42%, respectively.
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EXAMPLE OF EXPENSES
An investor would pay the following dollar amounts of expenses on a $1,000
investment in Class I shares of each Fund, assuming (a) a 5% annual return and
(b) redemption at the end of each of the time periods indicated:
CLASS I
INTERNATIONAL EMERGING
INTERNATIONAL GROWTH AND MARKETS
PERIOD GROWTH FUND INCOME FUND EQUITY FUND
1 year........... $18 $21 $20
3 years.......... 55 63 63
The purpose of the expense table above is to assist investors in
understanding the various costs and expenses that a shareholder of each Fund
will bear directly or indirectly. A more complete description of each Fund's
management fee is set forth under the caption "Management of the Funds" in the
Prospectus.
THE "EXAMPLE" SET FORTH ABOVE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST
OR FUTURE EXPENSES OF THE FUNDS; ACTUAL EXPENSES MAY BE GREATER OR LESS THAN
THOSE SHOWN.
ELIGIBLE PURCHASERS
Class I shares of each Fund are available for purchase only by the following
purchasers ("Eligible Purchasers"):
(i) certain retirement plans established for the benefit of employees of
Massachusetts Financial Services Company ("MFS"), the Fund's investment
adviser, and employees of MFS' affiliates;
(ii) any fund distributed by MFS Fund Distributors, Inc. ("MFD"), the Fund's
distributor, if the fund seeks to achieve its investment objective by
investing primarily in shares of the Fund and other funds distributed by
MFD;
(iii)any retirement plan which (a) purchases shares directly through MFD
(rather than through a third party broker or dealer or other financial
intermediary); (b) has, at the time of purchase of Class I shares,
aggregate assets of at least $100 million; and (c) invests at least $10
million in Class I shares of the Fund either alone or in combination with
investments in Class I shares of other MFS funds distributed by MFD
(additional investments may be made in any amount); provided that MFD may
accept purchases from smaller plans or in smaller amounts if it believes,
in its sole discretion, that the plan's aggregate assets will equal or
exceed $100 million, or that the plan will make additional investments
which will cause its total investment to equal or exceed $10 million,
within a reasonable period of time; and
(iv) bank trust departments which initially invest, on behalf of their trust
clients, at least $100,000 in Class I shares of the Fund (additional
investments may be made in any amount); provided that MFD may accept
smaller initial purchases if it believes, in its sole discretion, that the
bank trust department will make additional investments, on behalf of its
trust clients, which will cause its total investment to equal or exceed
$100,000 within a reasonable period of time.
In no event will a Fund, MFS, MFD or any of their affiliates pay any sales
commissions or compensation to any third party in connection with the sale of
Class I shares; the payment of any such sales commission or compensation would,
under the Fund's policies, disqualify the purchaser as an eligible investor of
Class I shares.
SHARE CLASSES OFFERED BY THE FUNDS
Four classes of shares of each Fund currently are offered for sale, Class A
shares, Class B shares, Class C shares and Class I shares. Class I shares are
available for purchase only by Eligible Purchasers, as defined above, and are
described in this Supplement. Class A shares, Class B shares and Class C shares
are described in the Funds' Prospectus and are available for purchase by the
general public.
Class A shares are offered at net asset value plus an initial sales charge
up to a maximum of 4.75% of the offering price (or a contingent deferred sales
charge (a "CDSC") upon redemption of 1.00% during the first year in the case of
purchases of $1 million or more and certain purchases by retirement plans), and
are subject to an annual distribution fee and service fee up to a maximum of
0.50% per annum. Class B shares are offered at net asset value without an
initial sales charge but are subject to a CDSC upon redemption (declining from
4.00% during the first year to 0% after six years) and an annual distribution
fee and service fee up to a maximum of 1.00% per annum; Class B shares convert
to Class A shares approximately eight years after purchase. Class C shares are
offered at net asset value without an initial sales charge but are subject to a
CDSC upon redemption of 1.00% during the first year and an annual distribution
fee and service fee up to a maximum of 1.00% per annum. Class I shares are
offered at net asset value without an initial sales charge or CDSC and are not
subject to a distribution or service fee. Class C and Class I shares do not
convert to any other class of shares of the Funds.
OTHER INFORMATION
Eligible Purchasers may purchase Class I shares only directly through MFD.
Eligible Purchasers may exchange Class I shares of each Fund for Class I shares
of any other MFS Fund available for purchase by such Eligible Purchasers at
their net asset value (if available for sale), and may exchange Class I shares
of the Fund for shares of the MFS Money Market Fund (if available for sale), and
may redeem Class I shares of the Fund at net asset value. Distributions paid by
the Fund with respect to Class I shares generally will be greater than those
paid with respect to Class A shares, Class B shares and Class C shares because
expenses attributable to Class A shares, Class B shares and Class C shares
generally will be higher.
MFS has agreed to bear, subject to reimbursement by the Emerging Markets
Equity Fund, until December 31, 2005, expenses of Class I shares of the Fund
such that the aggregate expenses of the Emerging Markets Equity Fund do not
exceed 2.00% of the Fund's average daily net assets attributable to Class I
shares on an annualized basis. This arrangement may be terminated or revised by
MFS at any time. Such payments by MFS are subject to reimbursement by the
Emerging Markets Equity Fund which will be accomplished by the payment by the
Fund of an expense reimbursement fee to MFS computed and paid monthly as a
percentage of its average daily net assets for its then current fiscal year,
with a limitation that immediately after such payment the aggregate operating
expenses of the Fund would not exceed the amounts set forth in the preceding
sentence. The expense reimbursement agreement terminates on the earlier of the
date on which payments made thereunder by the Emerging Markets Equity Fund equal
the prior payment of such reimbursable expenses by MFS or December 31, 2005.
THE DATE OF THIS SUPPLEMENT IS JANUARY 1, 1997
