<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON
JANUARY 27, 1998
1940 ACT FILE NO. 811-4841
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-2
REGISTRATION STATEMENT
UNDER THE INVESTMENT COMPANY ACT OF 1940 |X|
Amendment No. 9 |X|
MFS MUNICIPAL INCOME TRUST
(Exact Name of Registrant as Specified in Charter)
500 Boylston Street, Boston, Massachusetts 02116
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: 617-954-5000
Stephen E. Cavan
Secretary and Clerk
MFS Municipal Income Trust
c/o Massachusetts Financial Services Company
500 Boylston Street
Boston, Massachusetts 02116
(Name and Address of Agent for Service)
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits:
1. Exhibits:
(a) -- Amended and Restated Declaration
of Trust, dated November 13, 1986;
filed herewith.
(a)(2) -- Amendment to Declaration of Trust,
dated October 19, 1988; filed
herewith.
(b)(1) -- Amended and Restated By-Laws
dated December 21, 1994 (previously
filed as Exhibit (b)(2) to
Amendment No. 8 to the Registrant's
Registration Statement on Form N-2
filed with the Securities and
Exchange Commission on February 28,
1995 ("Amendment No. 8"));
incorporated herein by reference.
(c) -- Inapplicable.
(d) -- Specimen certificate for Shares
of Beneficial Interest; filed
herewith.
(e) -- The section "Dividend
Reinvestment and Cash Purchase Plan"
on page 3 of the Registrant's Annual
Report to its Shareholders, for its
fiscal year ended October 31, 1997;
incorporated herein by reference.
(f) -- Inapplicable.
(g)(1) -- Investment Advisory Agreement,
dated November 6, 1986; filed
herewith.
(g)(2) -- Master Administrative Services
Agreement dated March 1, 1997, by
and among Massachusetts Financial
Services Company and the Registrant;
filed herewith.
(h) -- Omitted pursuant to General
Instruction G.3. to Form N-2.
(i) -- Retirement Plan for
Non-Interested Person Trustees,
dated January 1, 1991; filed
herewith.
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(j)(1) -- Custodian Agreement dated
February 19, 1988 between the
Registrant and State Street Bank
and Trust Company; filed herewith.
(j)(2) -- Amendment to the Custodian
Agreement dated October 1, 1989;
filed herewith.
(j)(3) -- Amendment to Custodian Agreement
dated September 17, 1991; filed
herewith.
(j)(4) Amendment to Custodian Agreement
dated February 29, 1988; filed
herewith.
(k)(1) -- Loan Agreement by and among the
Banks named therein, and The First
National Bank of Boston, and the
MFS Funds named therein (previously
filed as Exhibit (k)(3) to
Amendment No. 8); incorporated
herein by reference.
(k)(2) -- Registrar, Transfer Agency and
Service Agreement between Registrant
and MFS Service Center, Inc., dated
August 15, 1994 (previously filed
as Exhibit (k)(2) to Amendment No.
8); incorporated herein by
reference.
(l) -- Omitted pursuant to General
Instruction G.3 to Form N-2.
(m) -- Inapplicable.
(n) -- Omitted pursuant to General
Instruction G.3 to Form N-2.
(o) -- Omitted pursuant to General
Instructions G.3 to Form N-2.
(p) -- Form of Purchase Agreement; filed
herewith.
(q) -- Inapplicable.
(r) -- Inapplicable.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Investment Company Act of 1940, the
Registrant has duly caused this Amendment to its Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Boston and Commonwealth of Massachusetts on the day of January, 1998.
MFS MUNICIPAL INCOME TRUST
By: JAMES R. BORDEWICK, JR.
James R. Bordewick, Jr.
Assistant Secretary
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Description of Exhibit
(a) Amended and Restated Declaration of Trust, dated November
13, 1986.
(a)(2) Amendment to Declaration of Trust, dated October 19, 1988.
(d) Specimen certificate for Shares of Beneficial Interest.
(g)(1) Investment Advisory Agreement, dated November 6, 1986.
(g)(2) Master Administrative Services Agreement dated March 1,
1997, by and among Massachusetts Financial Services Company and the
Registrant.
(i) Retirement Plan for Non-Interested Person Trustees, dated
January 1, 1991.
(j)(1) Custodian Agreement dated February 19, 1988 between the
Registrant and State Street Bank and Trust Company.
(j)(2) Amendment to the Custodian Agreement dated October 1, 1989.
(j)(3) Amendment to Custodian Agreement dated September 17, 1991.
(j)(4) Amendment to Custodian Agreement dated February 29, 1988.
(p) Form of Purchase Agreement.
<PAGE>
EXHIBIT NO. 99(a)
MFS MUNICIPAL INCOME TRUST
AMENDED AND RESTATED
DECLARATION OF TRUST
Dated November 13, 1986
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I - Name and Definitions 1
Section 1.1. Name
Section 1.2. Definitions
ARTICLE II - Trustees 3
Section 2.1. Number of Trustees
Section 2.2. Term of Office of Trustees
Section 2.3. Resignation and Appointment of Trustees
Section 2.4. Vacancies
Section 2.5. Delegation of Power to Other Trustees
ARTICLE III - Powers of Trustees 5
Section 3.1. General
Section 3.2. Investments
Section 3.3. Legal Title
Section 3.4. Issuance and Repurchase of Securities
Section 3.5. Borrowing Money; Lending Trust Property
Section 3.6. Delegation; Committees
Section 3.7. Collection and Payment
Section 3.8. Expenses
Section 3.9. Manner of Acting; By-Laws
Section 3.10. Miscellaneous Powers
Section 3.11. Principal Transactions
Section 3.12. Trustees and Officers as Shareholders
ARTICLE IV - Investment Adviser, Distributor and Transfer Agent 10
Section 4.1. Investment Adviser
Section 4.2. Distributor
Section 4.3. Transfer Agent
Section 4.4. Parties to Contract
<PAGE>
PAGE
ARTICLE V - Limitations of Liability of
Shareholders, Trustees and Others 11
Section 5.1. No Personal Liability of Shareholders,
Trustees, etc.
Section 5.2. Non-Liability of Trustees, etc.
Section 5.3. Mandatory Indemnification
Section 5.4. No Bond Required of Trustees
Section 5.5. No Duty of Investigation; Notice in Trust
Instruments, etc.
Section 5.6. Reliance on Experts, etc.
ARTICLE VI - Shares of Beneficial Interest 15
Section 6.1. Beneficial Interest
Section 6.2. Rights of Shareholders
Section 6.3. Trust Only
Section 6.4. Issuance of Shares
Section 6.5. Register of Shares
Section 6.6. Transfer of Shares
Section 6.7. Notices
Section 6.8. Voting Powers
ARTICLE VII - Determination of Net Asset Value, Net Income
and Distributions 17
ARTICLE VIII - Duration; Termination of Trust; Amendment;
Mergers, Etc. 18
Section 8.1. Duration
Section 8.2. Termination of Trust
Section 8.3. Amendment Procedure
Section 8.4 Merger, Consolidation and Sale of Assets
Section 8.5. Incorporation and Reorganization
Section 8.6. Conversion
Section 8.7. Certain Transactions
<PAGE>
PAGE
ARTICLE IX - Reports to Shareholders 23
ARTICLE X - Miscellaneous 23
Section 10.1. Filing
Section 10.2. Governing Law
Section 10.3. Counterparts
Section 10.4. Reliance by Third Parties
Section 10.5. Provisions in Conflict with Law or
Regulations
SIGNATURE PAGE 25
<PAGE>
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
MFS MUNICIPAL INCOME TRUST
Dated November 13, 1986
AMENDED AND RESTATED DECLARATION OF TRUST made November 13, 1986 by the
Trustees:
WHEREAS, by a Declaration of Trust dated September 18, 1986 (the
"Declaration") the Trustees established a trust for the investment and
reinvestment of funds contributed thereto known as MFS Municipal Income Trust
(the "Trust"); and
WHEREAS, the Declaration provides that, until such time as a
Registration Statement under the Securities Act of 1933, as amended, covering
the first public offering of securities of the Trust shall have become
effective, the Declaration may be amended by an instrument in writing signed by
a majority of the Trustees; and
WHEREAS, a Registration Statement under the Securities Act of 1933, as
amended, covering the first public offering of securities of the Trust has not
yet become effective; and
WHEREAS, the Declaration provides that a restated Declaration
integrating into a single instrument all of the provisions of the Declaration
which are then in effect and operative, may be executed from time to time by a
majority of the Trustees; and
WHEREAS, the Trustees desire to amend and to simultaneously restate the
Declaration so that this Amended and Restated Declaration, on the date of its
filing in the office of the Secretary of the Commonwealth of Massachusetts (the
"Effective Date"), shall contain all of the provisions of the Declaration which
are then in effect and operative;
NOW THEREFORE, the Trustees hereby amend and restate the Declaration,
and, on the Effective Date, the following provisions shall constitute all of the
provisions of the Declaration which are then in effect and operative.
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ARTICLE I
NAME AND DEFINITIONS
Section 1.1 Name. The name of the trust created hereby is
the "MFS Municipal Income Trust."
Section 1.2 Definitions. Wherever they are used herein, the
following terms have the following respective meanings:
(a) "By-Laws" means the By-Laws referred to in Section 3.9 hereof, as
from time to time amended.
(b) the terms "Commission," "Interested Person," and "Majority
Shareholder Vote," (the 67% or 50% requirement of the third sentence of Section
2(a)(42) of the 1940 Act, whichever may be applicable) have the meanings given
them in the 1940 Act.
(c) "Declaration" means this Declaration of Trust as amended from time
to time. Reference in this Declaration of Trust to "Declaration," "hereof,"
"herein" and "hereunder" shall be deemed to refer to this Declaration rather
than the article or section in which such words appear.
(d) "Distributor" means the party, other than the Trust, to the
contract described in Section 4.2 hereof.
(e) "Investment Adviser" means a party furnishing services to the Trust
pursuant to any contract described in Section 4.1 hereof.
(f) The "1940 Act" means the Investment Company Act of 1940 and the
Rules and Regulations thereunder, as amended from time to time.
(g) "Person" means and includes individuals, corporations,
partnerships, trusts, associations, joint ventures and other entities, whether
or not legal entities, and governments and agencies and political subdivisions
thereof, whether domestic or foreign.
(h) "Shareholder" means a record owner of outstanding Shares.
(i) "Shares" means the Shares of Beneficial Interest into which the
beneficial interest in the Trust shall be divided from time to time and includes
fractions of Shares as well as whole Shares.
(j) "Transfer Agent" means the party, other than the Trust, to a
contract described in Section 4.3 hereof.
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(k) The "Trust" means the entity specified in Section 1.1 above.
(l) The "Trust Property" means any and all property, real or personal,
tangible or intangible, which is owned or held by or for the account of the
Trust or the Trustees.
(m) The "Trustees" means the persons who have signed the Declaration,
so long as they shall continue in office in accordance with the terms hereof,
and all other persons who may from time to time be duly elected, qualified and
serving as Trustees in accordance with the provisions hereof, and reference
herein to a Trustee or the Trustees shall refer to such person or persons in
their capacity as trustees hereunder.
ARTICLE II
TRUSTEES
Section 2.1. Number of Trustees. The number of Trustees shall be such
number as shall be fixed from time to time by a written instrument signed by a
majority of the Trustees, provided, however, that the number of Trustees shall
in no event be less than three (3) nor more than fifteen (15). No reduction in
the number of Trustees shall have the effect of removing any Trustee from office
prior to the expiration of his term unless the Trustee is specifically removed
pursuant to Section 2.2 of this Article II at the time of the decrease.
Section 2.2. Term of Office of Trustees. The Board of Trustees shall be
divided into three classes. Within the limits above specified, the number of
Trustees in each class shall be determined by resolution of the Board of
Trustees. The term of office of all of the Trustees shall expire on the date of
first annual meeting of shareholders or special meeting in lieu thereof
following the Effective Date. The term of office of the first class shall expire
on the date of the second annual meeting of shareholders or special meeting in
lieu thereof. The term of office of the second class shall expire on the date of
the third annual meeting of shareholders or special meeting in lieu thereof. The
term of office of the third class shall expire on the date of the fourth annual
meeting of shareholders or special meeting in lieu thereof. Upon expiration of
the term of office of each class as set forth above, the number of Trustees in
such class, as determined by the Board of Trustees, shall be elected for a term
expiring on the date of the third annual meeting of shareholders or special
meeting in lieu thereof following such expiration to succeed the Trustees whose
terms of office expire. The Trustees shall be elected at an annual meeting of
the shareholders or special
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meeting in lieu thereof called for that purpose, except as provided in Section
2.3 of this Article and each Trustee elected shall hold office until his
successor shall have been elected and shall have qualified; except (a) that any
Trustee may resign his trust (without need for prior or subsequent accounting)
by an instrument in writing signed by him and delivered to the other Trustees,
which shall take effect upon such delivery or upon such later date as is
specified therein; (b) that any Trustee may be removed (provided the aggregate
number of Trustees after such removal shall not be less than the number required
by Section 2.1 hereof) with cause, at any time by written instrument, signed by
at least two-thirds of the remaining Trustees, specifying the date when such
removal shall become effective; (c) that any Trustee who requests in writing to
be retired or who has become incapacitated by illness or injury may be retired
by written instrument signed by a majority of the other Trustees, specifying the
date of his retirement; and (d) a Trustee may be removed at any meeting of
Shareholders by a vote of two-thirds of the outstanding Shares. Upon the
resignation or removal of a Trustee, or his otherwise ceasing to be a Trustee,
he shall execute and deliver such documents as the remaining Trustees shall
require for the purpose of conveying to the Trust or the remaining Trustees any
Trust property held in the name of the resigning or removed Trustee. Upon the
incapacity or death of any Trustee, his legal representative shall execute and
deliver on his behalf such documents as the remaining Trustees shall require as
provided in the preceding sentence.
Section 2.3. Resignation and Appointment of Trustees. In case of the
declination, death, resignation, retirement, removal or inability of any of the
Trustees, or in case a vacancy shall, by reason of an increase in number, or for
any other reason, exist, the remaining Trustees shall fill such vacancy by
appointing such other person as they in their discretion shall see fit. Such
appointment shall be evidenced by a written instrument signed by a majority of
the Trustees in office. Any such appointment shall not become effective,
however, until the person named in the written instrument of appointment shall
have accepted in writing such appointment and agreed in writing to be bound by
the terms of the Declaration. Within twelve months of such appointment, the
Trustees shall cause notice of such appointment to be mailed to each Shareholder
at his address as recorded on the books of the Trustees. An appointment of a
Trustee may be made by the Trustees then in office and notice thereof mailed to
Shareholders as aforesaid in anticipation of a vacancy to occur by reason of
retirement, resignation or increase in number of Trustees effective at a later
date, provided that said appointment shall become effective only at or after the
effective date of said retirement, resignation or increase in number of
Trustees. The power of
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appointment is subject to the provisions of Section 16(a) of the 1940
Act.
Section 2.4. Vacancies. The death, declination, resignation,
retirement, removal or incapacity of the Trustees, or any one of them, shall not
operate to annul the Trust or to revoke any existing agency created pursuant to
the terms of this Declaration. Whenever a vacancy in the number of Trustees
shall occur, until such vacancy is filled as provided in Section 2.3, the
Trustees in office, regardless of their number, shall have all the powers
granted to the Trustees and shall discharge all the duties imposed upon the
Trustees by the Declaration. A written instrument certifying the existence of
such vacancy signed by a majority of the Trustees shall be conclusive evidence
of the existence of such vacancy.
Section 2.5. Delegation of Power to Other Trustees. Any Trustee may, by
power of attorney, delegate his power for a period not exceeding six (6) months
at any one time to any other Trustee or Trustees; provided that in no case shall
less than two (2) Trustees personally exercise the powers granted to the
Trustees under the Declaration except as herein otherwise expressly provided.
ARTICLE III
POWERS OF TRUSTEES
Section 3.1. General. The Trustees shall have exclusive and absolute
control over the Trust Property and over the business of the Trust to the same
extent as if the Trustees were the sole owners of the Trust Property and
business in their own right, but with such powers of delegation as may be
permitted by the Declaration. The Trustees shall have power to conduct the
business of the Trust and carry on its operations in any and all of its branches
and maintain offices both within and without the Commonwealth of Massachusetts,
in any and all states of the United States of America, in the District of
Columbia, and in any and all commonwealths, territories, dependencies, colonies,
possessions, agencies or instrumentalities of the United States of America and
of foreign governments, and to do all such other things and execute all such
instruments as the Trustees deem necessary, proper or desirable in order to
promote the interests of the Trust although such things are not herein
specifically mentioned. Any determination as to what is in the interests of the
Trust made by the Trustees in good faith shall be conclusive. In construing the
provisions of the Declaration, the presumption shall be in favor of a grant of
power to the Trustees.
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The enumeration of any specific power herein shall not be construed as
limiting the aforesaid power. Such powers of the Trustees may be exercised
without order of or resort to any court.
Section 3.2. Investments. (a) The Trustees shall have the
power to:
(i) conduct, operate and carry on the business of an
investment company;
(ii) subscribe for, invest in, reinvest in, purchase or
otherwise acquire, own, hold, pledge, sell, assign, transfer, exchange,
distribute, lend or otherwise deal in or dispose of United States and foreign
currencies, any form of gold and other precious metals, commodity contracts,
options, contracts for the future acquisition or delivery of securities and
securities of every nature and kind, including, without limitation, all types of
bonds, debentures, stocks, negotiable or non-negotiable instruments,
obligations, evidences of indebtedness, certificates of deposit or indebtedness,
commercial paper, repurchase agreements, bankers' acceptances, and other
securities of any kind, issued, created, guaranteed or sponsored by any and all
Persons, including, without limitation, states, territories and possessions of
the United States and the District of Columbia and any political subdivisions,
agencies or instrumentalities thereof and the United States Government, any
foreign government, any political subdivisions thereof or any agencies or
instrumentalities, or by any bank or savings institution, or by any corporation
or organization organized under the laws of the United States or of any state,
territory or possession thereof, or by any corporation or organization organized
under any foreign law, or in "when issued" contracts for any such securities, or
retain Trust assets in cash and from time to time change the investments of the
assets of the Trust; and to exercise any and all rights, powers and privileges
of ownership or interest in respect of any and all such investments of every
kind and description, including, without limitation, the right to consent and
otherwise act with respect thereto, with power to designate one or more persons,
firms, associations or corporations to exercise any of said rights, powers and
privileges in respect of any of said instruments.
(iii) to carry on any other business in connection with or
incidental to any of the foregoing powers, to do everything necessary, suitable
or proper for the accomplishment of any purpose or the attainment of any object
or the furtherance of any power hereinbefore set forth, and to do every other
act or thing incidental or appurtenant to or connected with the aforesaid
purposes, objects or powers.
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(b) The Trustees shall not be limited to investing in
obligations maturing before the possible termination of the Trust, nor shall the
Trustees be limited by any law limiting the investments which may be made by
fiduciaries.
Section 3.3. Legal Title. Legal title to all the Trust Property shall
be vested in the Trustees as joint tenants except that the Trustees shall have
power to cause legal title to any Trust Property to be held by or in the name of
one or more of the Trustees, or in the name of the Trust, or in the name of any
other Person as nominee, on such terms as the Trustees may determine. The right,
title and interest of the Trustees in the Trust Property shall vest
automatically in each Person who may hereafter become a Trustee. Upon the
resignation, removal or death of a Trustee he shall automatically cease to have
any right, title or interest in any of the Trust Property, and the right, title
and interest of such Trustee in the Trust Property shall vest automatically in
the remaining Trustees. Such vesting and cessation of title shall be effective
whether or not conveyancing documents have been executed and delivered.
Section 3.4. Issuance and Repurchase of Securities. The Trustees shall
have the power to issue, sell, repurchase, retire, cancel, acquire, hold,
resell, reissue, dispose of, transfer, and otherwise deal in Shares and, subject
to the provisions set forth in Articles VII and VIII hereof, to apply to any
such retirement, cancellation or acquisition of Shares any funds or property of
the Trust whether capital or surplus or otherwise, to the full extent now or
hereafter permitted by the laws of the Commonwealth of Massachusetts governing
business corporations.
Section 3.5. Borrowing Money; Lending Trust Property. The Trustees
shall have power to borrow money or otherwise obtain credit and to secure the
same by mortgaging, pledging or otherwise subjecting as security the assets of
the Trust, to endorse, guarantee, or undertake the performance of any
obligation, contract or engagement of any other Person and to lend Trust
property.
Section 3.6. Delegation; Committees. The Trustees shall have power to
delegate from time to time to such of their number or to officers, employees or
agents of the Trust the doing of such things and the execution of such
instruments either in the name of the Trust or the names of the Trustees or
otherwise as the Trustees may deem expedient.
Section 3.7. Collection and Payment. The Trustees shall have power to
collect all property due to the Trust; to pay all claims, including taxes,
against the Trust Property; to prose-
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cute, defend, compromise or abandon any claims relating to the Trust Property;
to foreclose any security interest securing any obligations by virtue of which
any property is owed to the Trust; and to enter into releases, agreements and
other instruments.
Section 3.8. Expenses. The Trustees shall have the power to incur and
pay any expenses which in the opinion of the Trustees are necessary or
incidental to carry out any of the purposes of the Declaration, and to pay
reasonable compensation from the funds of the Trust to themselves as Trustees.
The Trustees shall fix the compensation of all officers, employees and Trustees.
Section 3.9. Manner of Acting; By-Laws. Except as otherwise provided
herein or in the By-Laws, any action to be taken by the Trustees may be taken by
a majority of the Trustees present at a meeting of Trustees (a quorum being
present), including any meeting held by means of a conference telephone circuit
or similar communications equipment by means of which all persons participating
in the meeting can hear each other, or by written consents of all the Trustees.
The Trustees may adopt By-Laws not inconsistent with this Declaration to provide
for the conduct of the business of the Trust and may amend or repeal such
By-Laws to the extent such power is not reserved to the Shareholders.
Section 3.10. Miscellaneous Powers. The Trustees shall have the power
to: (a) employ or contract with such Persons as the Trustees may deem desirable
for the transaction of the business of the Trust; (b) enter into joint ventures,
partnerships and any other combinations or associations; (c) remove Trustees or
fill vacancies in or add to their number, elect and remove such officers and
appoint and terminate such agents or employees as they consider appropriate, and
appoint from their own number, and terminate, any one or more committees which
may exercise some or all of the power and authority of the Trustees as the
Trustees may determine; (d) purchase, and pay for out of Trust Property,
insurance policies insuring the Shareholders, Trustees, officers, employees,
agents, investment advisers, distributors, selected dealers or independent
contractors of the Trust against all claims arising by reason of holding any
such position or by reason of any action taken or omitted by any such Person in
such capacity, whether or not constituting negligence, or whether or not the
Trust would have the power to indemnify such Person against such liability; (e)
establish pension, profit sharing, share purchase, and other retirement,
incentive and benefit plans for any Trustees, officers, employees and agents of
the Trust; (f) to the extent permitted by law, indemnify any person with whom
the Trust has dealings, including the Investment Adviser,
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Distributor, Transfer Agent, and selected dealers, to such extent as the
Trustees shall determine; (g) guarantee indebtedness or contractual obligations
of others; (h) determine and change the fiscal year of the Trust and the method
by which its accounts shall be kept; and (i) adopt a seal for the Trust but the
absence of such seal shall not impair the validity of any instrument executed on
behalf of the Trust.
Section 3.11. Principal Transactions. Except in transactions permitted
by the 1940 Act, or any order of exemption issued by the Commission, the
Trustees shall not, on behalf of the Trust, buy any securities (other than
shares) from or sell any securities (other than Shares) to, or lend any assets
of the Trust to, any Trustee or officer of the Trust or any firm of which any
such Trustee or officer is a member of the Trust or any firm of which any such
Trustee or officer is a member acting as principal, or have any such dealings
with the Investment Adviser, Distributor, or Transfer Agent or with any
Interested Person of such Person; but the Trust may employ any such Person, or
firm or company in which such Person is an Interested Person, as broker, legal
counsel, registrar, transfer agent, dividend disbursing agent or custodian upon
customary terms.
Section 3.12. Trustees and Officers as Shareholders. Except as
hereinafter provided, no officer, Trustee or member of the Advisory Board of the
Trust, and no member, partner, officer, director or trustee of the Investment
Adviser or of the Distributor, and no Investment Adviser or Distributor of the
Trust, shall take long or short positions in the securities issued by the Trust.
The foregoing provision shall not prevent:
(a) The Distributor from purchasing from the Trust Shares if such
purchases are limited (except for reasonable allowances for clerical errors,
delays and errors of transmission and cancellation of orders) to purchases for
the purpose of filling orders for Shares received by the Distributor and
provided that orders to purchase from the Trust are entered with the Trust or
the Custodian promptly upon receipt by the Distributor of purchase orders for
Shares, unless the Distributor is otherwise instructed by its customer;
(b) The Distributor from purchasing Shares as agent for
the account of the Trust;
(c) The purchase from the Trust or from the Distributor of Shares by
any officer, Trustee or member of the Advisory Board of the Trust or by any
member, partner, officer, director or trustee of the Investment Adviser or of
the Distributor at a price not lower than the net asset value of the Shares at
the moment of such purchase; or
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(d) The Investment Adviser, the Distributor, or any of their officers,
partners, directors or trustees from purchasing Shares prior to the effective
date of the Registration Statement relating to the Shares under the Securities
Act of 1933, as amended.
ARTICLE IV
INVESTMENT ADVISER, DISTRIBUTOR AND TRANSFER AGENT
Section 4.1. Investment Adviser. Subject to a Majority Shareholder
Vote, the Trustees may in their discretion from time to time enter into one or
more investment advisory or management contracts whereby a party to such
contract shall undertake to furnish the Trust such management, investment
advisory, statistical and research facilities and services, promotional
activities, and such other facilities and services, if any, as the Trustees
shall from time to time consider desirable and all upon such terms and
conditions as the Trustees may in their discretion determine. Notwithstanding
any provisions of the Declaration, the Trustees may delegate to the Investment
Adviser authority (subject to such general or specific instructions as the
Trustees may from time to time adopt) to effect purchases, sales, loans or
exchanges of assets of the Trust on behalf of the Trustees or may authorize any
officer, employee or Trustee to effect such purchases, sales, loans or exchanges
pursuant to recommendations of the Investment Adviser (and all without further
action by the Trustees). Any such purchases, sales, loans or exchanges shall be
deemed to have been authorized by all the Trustees.
Section 4.2. Distributor. The Trustees may in their discretion from
time to time enter into a contract, providing for the sale of Shares whereby the
Trust may either agree to sell the Shares to the other party to the contract or
appoint such other party its sales agent for such Shares. In either case, the
contract shall be on such terms and conditions as the Trustees may in their
discretion determine not inconsistent with the provisions of this Article IV or
the By-Laws; and such contract may also provide for the repurchase or sale of
Shares by such other party as principal or as agent of the Trust and may provide
that such other party may enter into selected dealer agreements with registered
securities dealers to further the purpose of the distribution of the Shares.
Section 4.3. Transfer Agent. The Trustees may in their discretion from
time to time enter into a transfer agency and shareholder service contract or
contracts whereby the other party to such contract shall undertake to furnish
transfer agency and/or shareholder services to the Trust. The contract or
contracts shall have such terms and conditions as the
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Trustees may in their discretion determine not inconsistent with the Declaration
or the By-Laws. Such services may be provided by one or more Persons.
Section 4.4. Parties to Contract. Any contract of the character
described in Sections 4.1, 4.2 or 4.3 of this Article IV or any Custodian
contract, as described in the By-Laws, may be entered into with any Person,
although one or more of the Trustees or officers of the Trust may be an officer,
partner, director, trustee, shareholder, or member of such other party to the
contract, and no such contract shall be invalidated or rendered voidable by
reason of the existence of any such relationship; nor shall any Person holding
such relationship be liable merely by reason of such relationship for any loss
or expense to the Trust under or by reason of said contract or accountable for
any profit realized directly or indirectly therefrom, provided that the contract
when entered into was not inconsistent with the provisions of this Article IV or
the By-Laws. The same Person may be the other party to contracts entered into
pursuant to Sections 4.1, 4.2 and 4.3 above or Custodian contracts, and any
individual may be financially interested or otherwise affiliated with Persons
who are parties to any or all of the contracts mentioned in this Section 4.4.
ARTICLE V
LIMITATIONS OF LIABILITY OF SHAREHOLDERS,
TRUSTEES AND OTHERS
Section 5.1. No Personal Liability of Shareholders, Trustees, etc.
Subject to Section 5.3, no Shareholder shall be subject to any personal
liability whatsoever to any Person in connection with Trust Property or the
acts, obligations or affairs of the Trust. No Trustee, officer, employee or
agent of the Trust shall be subject to any personal liability whatsoever to any
Person, other than the Trust or its Shareholders, in connection with Trust
Property or the affairs of the Trust, save only that arising from bad faith,
willful misfeasance, gross negligence or reckless disregard for his duty to such
Person; and all such Persons shall look solely to the Trust Property for
satisfaction of claims of any nature arising in connection with the affairs of
the Trust. If any Shareholder, Trustee, officer, employee, or agent, as such, of
the Trust, is made a party to any suit or proceeding to enforce any such
liability, he shall not, on account thereof, be held to any personal liability.
The Trust shall indemnify and hold each Shareholder harmless from and against
all claims and liabilities to which such Shareholder may become subject by
reason of his being or having been a Shareholder, and shall reimburse such
Shareholder for all legal and other expenses reasonably incurred by him in
connection with any such claim or liabil-
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ity. The rights accruing to a Shareholder under this Section 5.1 shall not
exclude any other right to which such Shareholder may be lawfully entitled, nor
shall anything herein contained restrict the right of the Trust to indemnify or
reimburse a Shareholder in any appropriate situation even though not
specifically provided herein.
Section 5.2. Non-Liability of Trustees, etc. Subject to Section 5.3, no
Trustee, officer, employee or agent of the Trust shall be liable to the Trust,
its Shareholders, or to any Shareholder, Trustee, officer, employee, or agent
thereof for any action or failure to act (including without limitation the
failure to compel in any way any former or acting Trustee to redress any breach
of trust) except for his own bad faith, willful misfeasance, gross negligence or
reckless disregard of his duties.
Section 5.3. Mandatory Indemnification. (a) Subject to the
exceptions and limitations contained in paragraph (b) below:
(i) every person who is or has been a Trustee or officer of
the Trust shall be indemnified by the Trust against all liability and against
all expenses reasonably incurred or paid by him in connection with any claim,
action, suit or proceeding in which he becomes involved as a party or otherwise
by virtue of his being or having been a Trustee or officer and against amounts
paid or incurred by him in the settlement thereof;
(ii) the words "claim," "action," "suit," or "proceeding"
shall apply to all claims, actions, suits or proceedings (civil, criminal, or
other, including appeals), actual or threatened; and the words "liability" and
"expenses" shall include, without limitation, attorneys' fees, costs, judgments,
amounts paid in settlement, fines, penalties and other liabilities.
(b) No indemnification shall be provided hereunder to a
Trustee or officer:
(i) against any liability to the Trust or the Shareholders by
reason of a final adjudication by the court or other body before which the
proceeding was brought that he engaged in willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office;
(ii) with respect to any matter as to which he shall have been
finally adjudicated not to have acted in good faith in the reasonable belief
that his action was in the best interest of the Trust;
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(iii) in the event of a settlement involving a payment by a
Trustee or officer or other disposition not involving a final adjudication as
provided in paragraph (b) (i) or (b) (ii) above resulting in a payment by a
Trustee or officer, unless there has been either a determination that such
Trustee or officer did not engage in willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office by the court or other body approving the settlement or other disposition
or by a reasonable determination, based upon a review of readily available facts
(as opposed to a full trial-type inquiry) that he did not engage in such
conduct:
(A) by vote of a majority of the Disinterested Trustees acting
on the matter (provided that a majority of the Disinterested
Trustees then in office act on the matter); or
(B) by written opinion of independent legal counsel.
(c) The rights of indemnification herein provided may be insured
against by policies maintained by the Trust, shall be severable, shall not
affect any other rights to which any Trustee or officer may now or hereafter be
entitled, shall continue as to a Person who has ceased to be such Trustee or
officer and shall inure to the benefit of the heirs, executors and
administrators of such Person. Nothing contained herein shall affect any rights
to indemnification to which personnel other than Trustees and officers may be
entitled by contract or otherwise under law.
(d) Expenses of preparation and presentation of a defense to any claim,
action, suit, or proceeding of the character described in paragraph (a) of this
Section 5.3 shall be advanced by the Trust prior to final disposition thereof
upon receipt of an undertaking by or on behalf of the recipient to repay such
amount if it is ultimately determined that he is not entitled to indemnification
under this Section 5.3, provided that either:
(i) such undertaking is secured by a surety bond or some other
appropriate security or the Trust shall be insured against losses arising out of
any such advances; or
(ii) a majority of the Disinterested Trustees acting on the
matter (provided that a majority of the Disinterested Trustees then in office
act on the matter) or an independent legal counsel in a written opinion, shall
determine, based upon a review of readily available facts (as opposed to a full
trial-type inquiry), that there is reason to believe that the recipient
ultimately will be found entitled to indemnification.
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As used in this Section 5.3, a "Disinterested Trustee" is one (i) who
is not an "Interested Person" of the Trust (including anyone who has been
exempted from being an "Interested Person" by any rule, regulation or order of
the Commission), and (ii) against whom none of such actions, suits or other
proceedings or another action, suit or other proceeding on the same or similar
grounds is then or had been pending.
Section 5.4. No Bond Required of Trustees. No Trustee
shall be obligated to give any bond or other security for the
performance of any of his duties hereunder.
Section 5.5. No Duty of Investigation; Notice in Trust Instruments,
etc. No purchaser, lender, transfer agent or other Person dealing with the
Trustees or any officer, employee or agent of the Trust shall be bound to make
any inquiry concerning the validity of any transaction purporting to be made by
the Trustees or by said officer, employee or agent or be liable for the
application of money or property paid, loaned, or delivered to or on the order
of the Trustees or of said officer, employee or agent. Every obligation,
contract, instrument, certificate, Share, other security of the Trust or
undertaking, and every other act or thing whatsoever executed in connection with
the Trust shall be conclusively presumed to have been executed or done by the
executors thereof only in their capacity as Trustees under the Declaration or in
their capacity as officers, employees or agents of the Trust. Every written
obligation, contract, instrument, certificate, Share, other security of the
Trust or undertaking made or issued by the Trustees shall recite that the same
is executed or made by them not individually, but as Trustees under the
Declaration, and that the obligations of any such instrument are not binding
upon any of the Trustees or Shareholders, individually, but bind only the trust
estate, and may contain any further recital which they or he may deem
appropriate, but the omission of such recital shall not operate to bind any of
the Trustees or Shareholders individually. The Trustees shall at all times
maintain insurance for the protection of the Trust Property, its Shareholders,
Trustees, officers, employees and agents in such amount as the Trustees shall
deem adequate to cover possible tort liability, and such other insurance as the
Trustees in their sole judgment shall deem advisable.
Section 5.6. Reliance on Experts, etc. Each Trustee and officer or
employee of the Trust shall, in the performance of his duties, be fully and
completely justified and protected with regard to any act or any failure to act
resulting from reliance in good faith upon the books of account or other records
of the Trust, upon an opinion of counsel, or upon reports made to the Trust by
any of its officers or employees or by the Investment Adviser, the Distributor,
Transfer Agent,
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selected dealers, accountants, appraisers or other experts or consultants
selected with reasonable care by the Trustees, officers or employees of the
Trust, regardless of whether such counsel or expert may also be a Trustee.
ARTICLE VI
SHARES OF BENEFICIAL INTEREST
Section 6.1. Beneficial Interest. The interest of the beneficiaries
hereunder shall be divided into transferable shares of beneficial interest all
of one class, without par value. The number of shares of beneficial interest
authorized hereunder is unlimited. All Shares issued hereunder including,
without limitation, Shares issued in connection with a dividend in Shares or a
split of Shares, shall be fully paid and non-assessable.
Section 6.2. Rights of Shareholders. The ownership of the Trust
Property of every description and the right to conduct any business hereinbefore
described are vested exclusively in the Trustees, and the Shareholders shall
have no interest therein other than the beneficial interest conferred by their
Shares, and they shall have no right to call for any partition or division of
any property, profits, rights or interests of the Trust nor can they be called
upon to assume any losses of the Trust or suffer an assessment of any kind by
virtue of their ownership of Shares. The Shares shall be personal property
giving only the rights in the Declaration specifically set forth. The Shares
shall not entitle the holder to preference, preemptive, appraisal, conversion or
exchange rights.
Section 6.3. Trust Only. It is the intention of the Trustees to create
only the relationship of Trustee and beneficiary between the Trustees and each
Shareholder from time to time. It is not the intention of the Trustees to create
a general partnership, limited partnership, joint stock association,
corporation, bailment or any form of legal relationship other than a trust.
Nothing in the Declaration shall be construed to make the Shareholders, either
by themselves or with the Trustees, partners or members of a joint stock
association.
Section 6.4. Issuance of Shares. The Trustees, in their discretion may,
from time to time without vote of the Shareholders, issue Shares, in addition to
the then issued and outstanding Shares and Shares held in the treasury, to such
party or parties and for such amount and type of consideration, including cash
or property, at such time or times, and on such terms as the Trustees may deem
best, and may in such manner acquire other assets (including the acquisition of
assets subject to, and in connection with the assumption of liabili-
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ties) and businesses. In connection with any issuance of Shares, the Trustees
may issue fractional Shares. The Trustees may from time to time divide or
combine the Shares into a greater or lesser number without thereby changing
their proportionate beneficial interests in Trust. Contributions to the Trust
may be accepted for whole Shares and/or l/l,000ths of a Share or integral
multiples thereof.
Section 6.5. Register of Shares. A register shall be kept at the
principal office of the Trust or at an office of the Transfer Agent which shall
contain the names and addresses of the Shareholders and the number of Shares
held by them respectively and a record of all transfers thereof. Such register
shall be conclusive as to who are the holders of the Shares and who shall be
entitled to receive dividends or distributions or otherwise to exercise or enjoy
the rights of Shareholders. No Shareholder shall be entitled to receive payment
of any dividend or distribution, nor to have notice given to him as herein or in
the By-Laws provided, until he has given his address to the Transfer Agent or
such other officer or agent of the Trustees as shall keep the said register for
entry thereon. The Trustees, in their discretion, may authorize the issuance of
Share certificates and promulgate appropriate rules and regulations as to their
use.
Section 6.6. Transfer of Shares. Shares shall be transferable on the
records of the Trust only by the record holder thereof or by his agent thereunto
duly authorized in writing, upon delivery to the Trustees or the Transfer Agent
of a duly executed instrument of transfer, together with any certificate or
certificates (if issued) for such Shares and such evidence of the genuineness of
each such execution and authorization and of other matters as may reasonably be
required. Upon such delivery the transfer shall be recorded on the register of
the Trust. Until such record is made, the Shareholder of record shall be deemed
to be the holder of such Shares for all purposes hereunder and neither the
Trustees nor any Transfer Agent or registrar nor any officer, employee or agent
of the Trust shall be affected by any notice of the proposed transfer.
Any person becoming entitled to any Shares in consequence of the death,
bankruptcy, or incompetence of any Shareholder, or otherwise by operation of
law, shall be recorded on the register of Shares as the holder of such Shares
upon production of the proper evidence thereof to the Trustees or the Transfer
Agent; but until such record is made, the Shareholder of record shall be deemed
to be the holder of such Shares for all purposes hereunder and neither the
Trustees nor any Transfer Agent or registrar nor any officer or agent of the
Trust shall be affected by any notice of such death, bankruptcy or incompetence,
or other operation of law.
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Section 6.7. Notices. Any and all notices to which any Shareholder may
be entitled and any and all communications shall be deemed duly served or given
if mailed, postage prepaid, addressed to any Shareholder of record at his last
known address as recorded on the register of the Trust.
Section 6.8. Voting Powers. The Shareholders shall have power to vote
only (i) for the election of Trustees or for their removal as provided in
Section 2.2 hereof, (ii) with respect to any investment advisory or management
contract as provided in Section 4.1 hereof, (iii) with respect to termination of
the Trust as provided in Section 8.2, (iv) with respect to any amendment of the
Declaration to the extent and as provided in Section 8.3, (v) with respect to
any merger, consolidation, conversion or sale of assets as provided in Sections
8.4, 8.5 and 8.7, (vi) with respect to incorporation of the Trust to the extent
and as provided in Section 8.5, (vii) to the same extent as the stockholders of
a Massachusetts business corporation as to whether or not a court action,
proceeding or claim should or should not be brought or maintained derivatively
or as a class action on behalf of the Trust or the Shareholders, and (viii) with
respect to such additional matters relating to the Trust as may be required by
the Declaration, the By-Laws or any registration of the Trust with the
Commission (or any successor agency) or any state, or as the Trustees may
consider necessary or desirable. Each whole Share shall be entitled to one vote
as to any matter on which it is entitled to vote and each fractional Share shall
be entitled to a proportionate fractional vote, except that Shares held in the
treasury of the Trust shall not be voted. There shall be no cumulative voting in
the election of Trustees. Until Shares are issued, the Trustees may exercise all
rights of Shareholders and may take any action required by law, the Declaration
or the By-Laws to be taken by Shareholders. The By-Laws may include further
provisions for Shareholders' votes and meetings and related matters.
ARTICLE VII
DETERMINATION OF NET ASSET VALUE,
NET INCOME AND DISTRIBUTIONS
The Trustees, in their absolute discretion, may prescribe and shall set
forth in the By-Laws or in a duly adopted vote of the Trustees such bases and
times for determining the per Share net asset value of the Shares or net income,
or the declaration and payment of dividends and distributions, as they may deem
necessary or desirable.
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ARTICLE VIII
DURATION; TERMINATION OF TRUST; AMENDMENT; MERGERS, ETC.
Section 8.1. Duration. The Trust shall continue without
limitation of time but subject to the provisions of this Article VIII.
Section 8.2. Termination of Trust. (a) The Trust may be terminated (i)
by the affirmative vote of the holders of not less than two-thirds of the Shares
outstanding and entitled to vote at any meeting of Shareholders, or (ii) by an
instrument in writing, without a meeting, signed by a majority of the Trustees
and consented to by the holders of not less than two-thirds of such Shares. Upon
the termination of the Trust:
(i) The Trust shall carry on no business
except for the purpose of winding up its affairs;
(ii) The Trustees shall proceed to wind up the affairs of
the Trust and all the powers of the Trustees under this Declaration shall
continue until the affairs of the Trust shall have been wound up, including the
power to fulfill or discharge the contracts of the Trust, collect its assets,
sell, convey, assign, exchange, transfer or otherwise dispose of all or any part
of the remaining Trust Property to one or more persons at public or private sale
for consideration which may consist in whole or in part of cash, securities or
other property of any kind, discharge or pay its liabilities, and to do all
other acts appropriate to liquidate its business; provided, that any sale,
conveyance, assignment, exchange, transfer or other disposition of all or
substantially all the Trust Property shall require Shareholder approval in
accordance with Section 8.4 hereof; and
(iii) After paying or adequately providing for the payment of
all liabilities, and upon receipt of such releases, indemnities and refunding
agreements as they deem necessary for their protection, the Trustees may
distribute the remaining Trust Property, in cash or in kind or partly in cash
and partly in kind, among the Shareholders according to their respective rights.
(b) After termination of the Trust and distribution to the
Shareholders as herein provided, a majority of the Trustees shall execute and
lodge among the records of the Trust an instrument in writing setting forth the
fact of such termination, and the Trustees shall thereupon be discharged from
all further liabilities and duties hereunder, and the rights and interests of
all Shareholders shall thereupon cease.
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Section 8.3. Amendment Procedure. (a) Except as provided in paragraph
(c) of this Section 8.3 this Declaration may be amended by a Majority
Shareholder Vote or by an instrument in writing, without a meeting, signed by a
majority of the Trustees and consented to by the holders of not less than a
majority of the Shares outstanding and entitled to vote. The Trustees may also
amend this Declaration without the vote or consent of Shareholders, to change
the name of the Trust, to supply any omission, to cure, correct or supplement
any ambiguous, defective or inconsistent provision hereof, or if they deem it
necessary to conform this Declaration to the requirements of applicable federal
laws or regulations or the requirements of the regulated investment company
provisions of the Internal Revenue Code, but the Trustees shall not be liable
for failing so to do.
(b) No amendment may be made under this Section 8.3 which would change
any rights with respect to any Shares by reducing the amount payable thereon
upon liquidation of the Trust or by diminishing or eliminating any voting rights
pertaining thereto, except with the vote or consent of the holders of two-thirds
of the Shares outstanding and entitled to vote. Nothing contained in this
Declaration shall permit the amendment of this Declaration to impair the
exemption from personal liability of the Shareholders, Trustees, Officers,
employees and agents of the Trust or to permit assessment upon Shareholders.
(c) No amendment may be made under this Section 8.3 which shall amend,
alter, change or repeal any of the provisions of Sections 8.3, 8.4, 8.6 and 8.7
unless the amendment effecting such amendment, alteration, change or repeal
shall receive the affirmative vote or consent of sixty-six and two-thirds
percent (66 2/3%) of the Shares outstanding and entitled to vote. Such
affirmative vote or consent shall be in addition to the vote or consent of the
holders of Shares otherwise required by law or by the terms of any class or
series of preferred stock, whether now or hereafter authorized, or any agreement
between the Trust and any national securities exchange.
(d) A certificate signed by a majority of the Trustees setting forth an
amendment and reciting that it was duly adopted by the Shareholders or by the
Trustees as aforesaid or a copy of the Declaration, as amended, and executed by
a majority of the Trustees, shall be conclusive evidence of such amendment when
lodged among the records of the Trust.
Notwithstanding any other provision hereof, until such time as a
Registration Statement under the Securities Act of 1933, as amended, covering
the first public offering of securities of
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the Trust shall have become effective, this Declaration may be terminated or
amended in any respect by the affirmative vote of a majority of the Trustees or
by an instrument signed by a majority of the Trustees.
Section 8.4. Merger, Consolidation and Sale of Assets. The Trust may
merge or consolidate with any other corporation, association, trust or other
organization or may sell, lease or exchange all or substantially all of the
Trust Property, including its good will, upon such terms and conditions and for
such consideration when and as authorized at any meeting of Shareholders called
for the purpose by the affirmative vote of the holders of not less than
two-thirds of the Shares outstanding and entitled to vote, or by an instrument
or instruments in writing without a meeting, consented to by the holders of not
less than two-thirds of such Shares, provided, however, that if such merger,
consolidation, sale, lease or exchange is recommended by the Trustees, the vote
or written consent of the holders of a majority of Shares outstanding and
entitled to vote, shall be sufficient authorization; and any such merger,
consolidation, sale, lease or exchange shall be deemed for all purposes to have
been accomplished under and pursuant to the statutes of the Commonwealth of
Massachusetts. Nothing contained herein shall be construed as requiring approval
of shareholder for any sale of assets in the ordinary course of business of the
Trust.
Section 8.5. Incorporation and Reorganization. With the approval of the
holders of a majority of the Shares outstanding and entitled to vote, the
Trustees may cause to be organized or assist in organizing a corporation or
corporations under the laws of any jurisdiction, or any other trust,
partnership, association or other organization to take over all of the Trust
Property or to carry on any business in which the Trust shall directly or
indirectly have any interest, and to sell, convey and transfer the Trust
Property to any such corporation, trust, partnership, association or
organization in exchange for the shares or securities thereof or otherwise and
to lend money to, subscribe for the shares or securities of, and enter into any
contracts with any such corporation, trust, partnership, association or
organization in which the Trust holds or is about to acquire shares or any other
interest. Subject to Section 8.4 hereof, the Trustees may also cause a merger or
consolidation between the Trust or any successor thereto and any such
corporation, trust, partnership, association or other organization if and to the
extent permitted by law as provided under the law then in effect. Nothing
contained herein shall be construed as requiring approval of Shareholders for
the Trustees to organize or assist in organizing one or more corporations,
trusts, partnerships, associations or other organizations and selling, conveying
or transferring a portion of the Trust Property to such organization or
entities.
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Section 8.6. Conversion. Notwithstanding any other provision of this
Declaration, the conversion of the Trust from a "closed-end company" to an
"open-end company," as those terms are defined in Sections 5(a)(2) and 5(a)(1),
respectively, of the 1940 Act as in effect on June 1, 1986, shall require the
affirmative vote or consent of the holders of sixty-six and two-thirds percent
(66 2/3%) of the Shares outstanding and entitled to vote. Such affirmative vote
or consent shall be in addition to the vote or consent of the holders of the
Shares otherwise required by law or by the terms of any class or series of
preferred stock, whether now or hereafter authorized, or any agreement between
the Trust and any national securities exchange.
Section 8.7. Certain Transactions. (a) Notwithstanding any other
provision of this Declaration and subject to the exceptions provided in
paragraph (d) of this Section, the types of transactions described in paragraph
(c) of this Section shall require the affirmative vote or consent of the holders
of sixty-six and two-thirds (66 2/3%) of the Shares outstanding and entitled to
vote, when a Principal Shareholder (as defined in paragraph (b) of this Section)
is a party to the transaction. Such affirmative vote or consent shall be in
addition to the vote or consent of the holders of Shares otherwise required by
law or by the terms of any class or series of preferred stock, whether now or
hereafter authorized, or any agreement between the Trust and any national
securities exchange.
(b) The term "Principal Shareholder" shall mean any corporation, person
or other entity which is the beneficial owner, directly or directly, of more
than five percent (5%) of the outstanding Shares and shall include any affiliate
or associate, as such terms are defined in clause (ii) below, of a Principal
Shareholder. For the purposes of this Section, in addition to the Shares which a
corporation, person or other entity beneficially owns directly, (a) any
corporation, person or other entity shall be deemed to be the beneficial owner
of any Shares (i) which it has the right to acquire pursuant to any agreement or
upon exercise of conversion rights or warrants, or otherwise (but excluding
share options granted by the Trust) or (ii) which are beneficially owned,
directly or indirectly (including Shares deemed owned through application of
clause (i) above), by any other corporation, person or entity with which its
"affiliate" or "associate" (as defined below) has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or disposing of
Shares, or which is its "affiliate", or "associate" as those terms are defined
in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange
Act of 1934 as in effect on December 1, 1986, and (b) the outstanding Shares
shall include
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Shares deemed owned through application of clauses (i) and (ii) above but shall
not include any other Shares which may be issuable pursuant to any agreement, or
upon exercise of conversion rights or warrants, or otherwise.
(c) This Section shall apply to the following transactions:
(i) The merger or consolidation of the Trust or any subsidiary of the
Trust with or into any Principal Shareholder.
(ii) The issuance of any securities of the Trust to any Principal
Shareholder for cash.
(iii) The sale, lease or exchange of all or any substantial part of the
assets of the Trust to any Principal Shareholder (except assets
having an aggregate fair market value of less than $1,000,000,
aggregating for the purpose of such computation all assets sold,
leased or exchanged in any series of similar transactions within a
twelve-month period.)
(iv) The sale, lease or exchange to the Trust or any subsidiary
thereof, in exchange for securities of the Trust of any assets of
any Principal Shareholder (except assets having an aggregate fair
market value of less than $1,000,000, aggregating for the purposes
of such computation all assets sold, leased or exchanged in any
series of similar transactions within a twelve-month
period).
(d) The provisions of this Section shall not be applicable to (i) any
of the transactions described in paragraph (c) of this Section if the Board of
Trustees of the Trust shall by resolution have approved a memorandum of
understanding with such Principal Shareholder with respect to any substantially
consistent with such transaction, or (ii) any such transaction with any
corporation of which a majority of the outstanding shares of all classes of
stock normally entitled to vote in elections of directors is owned of record or
beneficially by the Trust and its subsidiaries.
(e) The Board of Trustees shall have the power and duty to determine
for the purposes of this Section on the basis of information known to the Trust,
whether (i) a corporation, person or entity beneficially owns more than five
percent (5%) of the outstanding Shares, (ii) a corporation, person or entity is
an "affiliate" or "associate" (as defined above) of another, (iii) the assets
being acquired or leased to or by the Trust or any subsidiary thereof,
constitute a substantial part of the assets of the Trust and have an aggregate
fair market value of
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less than $1,000,000, and (iv) the memorandum of understanding referred to in
paragraph (d) hereof is substantially consistent with the transaction covered
thereby. Any such determination shall be conclusive and binding for all purposes
of this Section.
ARTICLE IX
REPORTS TO SHAREHOLDERS
The Trustees shall at least semi-annually submit to the Shareholders a
written financial report of the transactions of the Trust, including financial
statements which shall at least annually be certified by independent public
accountants.
ARTICLE X
MISCELLANEOUS
Section 10.1. Filing. This Declaration and any amendment hereto shall
be filed in the office of the Secretary of the Commonwealth of Massachusetts and
in such other places as may be required under the laws of Massachusetts and may
also be filed or recorded in such other places as the Trustees deem appropriate.
Each amendment so filed shall be accompanied by a certificate signed and
acknowledged by a Trustee stating that such action was duly taken in a manner
provided herein, and unless such amendment or such certificate sets forth some
later time for the effectiveness of such amendment, such amendment shall be
effective upon its filing. A restated Declaration, integrating into a single
instrument all of the provisions of the Declaration which are then in effect and
operative, may be executed from time to time by a majority of the Trustees and
shall, upon filing with the Secretary of the Commonwealth of Massachusetts, be
conclusive evidence of all amendments contained therein and may thereafter be
referred to in lieu of the original Declaration and the various amendments
thereto.
Section 10.2. Governing Law. This Declaration is executed by the
Trustees and delivered in the Commonwealth of Massachusetts and with reference
to the laws thereof, and the rights of all parties and the validity and
construction of every provision hereof shall be subject to and construed
according to the laws of said State.
Section 10.3. Counterparts. This Declaration may be simultaneously
executed in several counterparts, each of which shall be deemed to be an
original, and such counterparts, together, shall constitute one and the same
instrument, which shall be sufficiently evidenced by any such original
counterpart.
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Section 10.4. Reliance by Third Parties. Any certificate executed by an
individual who, according to the records of the Trust appears to be a Trustee
hereunder, certifying to: (a) the number or identity of Trustees or
Shareholders, (b) the due authorization of the execution of any instrument or
writing, (c) the form of any vote passed at a meeting of Trustees or
Shareholders, (d) the fact that the number of Trustees or Shareholders present
at any meeting or executing any written instrument satisfies the requirements of
this Declaration, (e) the form of any By-Laws adopted by or the identity of any
officers elected by the Trustees, or (f) the existence of any fact or facts
which in any manner relate to the affairs of the Trust, shall be conclusive
evidence as to the matters so certified in favor of any Person dealing with the
Trustees and their successors.
Section 10.5. Provisions in Conflict with Law or Regulations. (a) The
provisions of the Declaration are severable, and if the Trustees shall
determine, with the advice of counsel, that any of such provisions is in
conflict with the 1940 Act, the regulated investment company provisions of the
Internal Revenue Code, or with other applicable laws and regulations, the
conflicting provision shall be deemed never to have constituted a part of the
Declaration; provided however, that such determination shall not affect any of
the remaining provisions of the Declaration or render invalid or improper any
action taken or omitted prior to such determination.
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<PAGE>
(b) If any provision of the Declaration shall be held invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall
attach only to such provision in such jurisdiction and shall not in any manner
affect such provision in any other jurisdiction or any other provision of the
Declaration in any jurisdiction.
IN WITNESS WHEREOF, the undersigned have executed this instrument this 13th day
of November, 1986.
RICHARD B. BAILEY
Richard B. Bailey, as
Trustee and not individually
200 Berkeley Street
Boston, Massachusetts
A. KEITH BRODKIN
A. Keith Brodkin, as Trustee
and not individually
200 Berkeley Street
Boston, Massachusetts
NELSON J. DARLING, JR.
Nelson J. Darling, Jr., as Trustee
and not individually
18 Tremont Street
Boston, Massachusetts
AMOS B. HOSTETTER, JR.
Amos B. Hostetter, Jr., as Trustee
and not individually
Lewis Wharf Pilot House
Boston, Massachusetts
John Lowell, as Trustee and not
individually
73 Tremont Street
Boston, Massachusetts
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<PAGE>
Lawrence T. Perera, as Trustee and
not individually
60 State Street
Boston, Massachusetts
William J. Poorvu, as Trustee and
not individually
Harvard University
Morgan Hall 237
Boston, Massachusetts
CHARLES W. SCHMIDT
Charles W. Schmidt, as Trustee and
not individually
141 Spring Street
Lexington, Massachusetts
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<PAGE>
COMMONWEALTH OF MASSACHUSETTS
SUFFOLK, SS BOSTON, MASSACHUSETTS
November 13, 1986
Then personally appeared the above-named Richard B. Bailey,
A. Keith Brodkin, Nelson J. Darling, Jr., Amos B. Hostetter, Jr. and
Charles W. Schmidt, and who severally acknowledged the foregoing
instrument to be their free act and deed.
Before me,
ELEIN F. WEBSTER
Elein F. Webster
Notary Public
My Commission Expires: 12/4/92
<PAGE>
EXHIBIT NO. 99(a)(2)
MFS MUNICIPAL INCOME TRUST
CERTIFICATION OF AMENDMENT
TO DECLARATION OF TRUST
The undersigned, constituting a majority of the Trustees of MFS
Municipal Income Trust (the "MFM"), a business trust organized under the laws of
the Commonwealth of Massachusetts pursuant to a Declaration of Trust dated
November 13, 1986 (the "Declaration"), do hereby certify, as provided by the
provisions of Section 9.3(d) of the Declaration, that in accordance with the
provisions of the last sentence of Section 9.3(a), a majority of the Trustees of
the Trust, by vote duly adopted by a majority of the Trustees as of October 19,
1988, amended the Declaration as follows:
Section 3.12 is amended to read in its entirety:
Section 3.12. Trustees and Officers as Shareholders. No officer,
Trustee or Member of the Advisory Board of the Trust, and no member, partner,
officer, director or trustee of the Investment Adviser or of the Distributor,
and no Investment Adviser or Distributor of the Trust, shall take a short
position in the securities issued by the Trust.
IN WITNESS WHEREOF, the undersigned have executed this certificate this 19th day
of October, 1988.
RICHARD B. BAILEY
Richard B. Bailey
A. KEITH BRODKIN
A. Keith Brodkin
NELSON J. DARLING, JR.
Nelson J. Darling, Jr.
AMOS B. HOSTETTER, JR.
Amos B. Hostetter, Jr.
<PAGE>
JOHN LOWELL
John Lowell
WILLIAM J. POORVU
William J. Poorvu
CHARLES W. SCHMIDT
Charles W. Schmidt
<PAGE>
EXHIBIT NO. 99(d)
SHARES OF SHARES OF
BENEFICIAL INTEREST BENEFICIAL INTEREST
WITHOUT WITHOUT
PAR VALUE PAR VALUE
ORGANIZED UNDER THE LAWS
OF THE COMMONWEALTH THIS CERTIFICATE IS TRANSFERABLE
OF MASSACHUSETTS IN BOSTON AND IN NEW YORK CITY
C U S I P 552738 10 6
SEE REVERSE FOR CERTAIN DEFINITIONS
MFS MUNICIPAL INCOME TRUST
THIS CERTIFIES THAT
S P E C I M E N
IS THE OWNER OF
FULLY PAID AND NON-ASSESSABLE SHARES OF BENEFICIAL INTEREST OF
MFS Municipal Income Trust, transferable on the books of the
Trust by the holder hereof in person or by duly authorized attorney upon
surrender of this Certificate properly endorsed. This Certificate and the shares
represented hereby are issued and shall be subject to all of the provisions of
the Declaration of Trust and By-Laws of the Trust, each as from time to time
amended, (copies of which are on file with the Transfer Agent), to all of which
the holder by acceptance hereof assents. This Certificate is not valid until
countersigned and registered by the Transfer Agent and Registrar.
Witness the facsimile seal of the Trust and the facsimile
signatures of its duly authorized officers.
Dated: MFS Municipal Income Trust
COUNTERSIGNED AND REGISTERED: BY:
STATE STREET BANK AND TRUST COMPANY
(BOSTON)
TRANSFER AGENT
AND REGISTRAR,
BY: W. THOMAS LONDON ROBIN S. HUNTLEY
W. Thomas London Robin S. Huntley
AUTHORIZED SIGNATURE TREASURER PRESIDENT
<PAGE>
EXHIBIT NO. 99(g)(1)
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT, made the 6th day of November, 1986, by and between MFS
MUNICIPAL INCOME TRUST, a Massachusetts business trust (the "Fund"), and
MASSACHUSETTS FINANCIAL SERVICES COMPANY, a Delaware corporation (the
"Adviser").
WITNESSETH:
WHEREAS, the Fund is engaged in business as a closed-end investment
company registered under the Investment Company Act of 1940;
WHEREAS, the Adviser is willing to provide business management 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:
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 its Declaration of Trust,
dated September 18, 1986 (the "Declaration") and By-Laws (the "By-Laws"), as
each may be amended from time to time, to the provisions of the Investment
Company Act of 1940 (the "Act") and the Rules, Regulations and orders thereunder
and to the Fund's then current registration statement under the Act. 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 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 notices or until similarly notified that
such determination has been 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 instruc-
-1-
<PAGE>
tions to the Custodian of the Fund as to 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 best available price. Subject to this
requirement of seeking the best available price, securities may be bought from
or sold to broker dealers who have furnished statistical, research and other
information or services to the Adviser or the Fund subject to any applicable
laws, rules or regulations.
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 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 Fund 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 and dividend
disbursing agent of the Fund, expenses of servicing shareholder accounts,
expenses of preparing, printing and mailing share certificates shareholders'
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,
calculation of the net asset value of shares of the Fund, expenses of
shareholder meetings, expenses relating to the repurchase of shares, 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).
3. Compensation of the Adviser. For the services to be rendered and for the
facilities to be provided, the Fund shall pay to the Adviser out of the assets
of the Fund an investment advisory fee computed and paid monthly in an amount
equal to
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<PAGE>
the sum of .40% of the average weekly net assets of the Fund and 6.32% of the
gross income (i.e., income other than gains from the sale of securities or gains
received from futures contracts) of the Fund, in each case on an annualized
basis, for its then-current fiscal year.
4. Covenants of the Adviser. The Adviser agrees that it will not deal with
itself, or with the Trustees of the Fund's principal underwriter, 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 of
Trust, and will comply with all other provisions of the Declaration of Trust and
By-Laws and the then current Prospectus of the Fund relative to the Adviser and
its directors and officers.
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
Fund, except for willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of reckless disregard of its obligations
and duties hereunder. As used in this ARTICLE 5, the term "Adviser" shall
include directors, officers and employees of the Adviser as well as the
corporation itself.
6. Activities of the Adviser. The services of the Adviser to the Fund are not to
be 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 Adviser to the Fund, the Fund will change its
name so as to delete the initials "MFS". It is understood that Trustees,
officers and shareholders of the Fund are or may be or become interested in the
Adviser, as directors, officers, employees, or otherwise and that directors,
officers and employees, or otherwise and that directors, officers and employees
of the Adviser are or may be or become similarly interested in the Fund and that
the Adviser may be or become interested in the Fund and that the Adviser may be
or become interested in the Fund as a shareholder or otherwise.
7. Duration, Termination and Amendments of this Agreement. This Agreement shall
become effective on the day and year first above written and shall govern the
relations between the parties hereto thereafter, and shall remain in force until
August 1, 1988 on which date it will terminate unless its continuance after
August 1, 1988 is "specifically approved at least annually" (i) by the vote of a
majority of the Trustees of the Fund who are not "interested persons" of the
Fund or of the Adviser at a meeting specifically called for the purpose of
-3-
<PAGE>
voting on such approval, and (ii) by the Trustees of the Fund, 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 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.
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 in and shall be construed in a manner consistent
with, the Investment Company Act of 1940 and the Rules and Regulations
thereunder, subject, however, to such exemptions as may be granted by the
Securities and Exchange Commission under said Act.
-4-
<PAGE>
IN WITNESS WHEREOF, the parties hereto 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 above written. The
undersigned Trustee of the Fund 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 Fund, individually,
but bind only the trust estate.
MFS MUNICIPAL INCOME TRUST
By: RICHARD B. BAILEY
Richard B. Bailey, Trustee
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By: H. ALDEN JOHNSON, JR.
H. Alden Johnson, Jr., President
-5-
<PAGE>
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
<PAGE>
(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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<PAGE>
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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<PAGE>
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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<PAGE>
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. KEITH BRODKIN
A. Keith Brodkin
Chairman and President
On behalf of the MFS/Sun Life Series
Trust and Compass Products listed on
Exhibit A hereto
By:/S/ JOHN D. MCNEIL
John D. McNeil
Chairman
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By:/S/ JEFFREY L. SHAMES
Jeffrey L. Shames
President
-5-
<PAGE>
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
-6-
<PAGE>
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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<PAGE>
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
-8-
<PAGE>
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
-9-
<PAGE>
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 Stephen E. Cavan and Joseph W.
Dello Russo 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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<PAGE>
EXHIBIT NO. 99(i)
MFS MUNICIPAL INCOME TRUST
RETIREMENT PLAN FOR NON-INTERESTED PERSON TRUSTEES
MFS Municipal Income Trust (the "Fund") has adopted this Retirement
Plan for Non-Interested Person Trustees (the "Plan"). The Plan has been
established for the purpose of providing certain benefits to eligible
Independent Trustees of the Fund, or their beneficiaries, after termination of
the Independent Trustees' services as such.
1. DEFINITIONS
The following terms shall have the following meanings:
Accrued Benefit: A benefit which is equal to the Normal
Retirement Benefit calculated using an Independent Trustee's
Years of Service and Annual Compensation as of the determination
date.
Actuarial Equivalent: A benefit equal in value, based on (a)
an interest rate equal to the immediate annuity rate published by
the Pension Guaranty Corporation for the January of the Plan Year
of calculation and (b) the 1983 Individual Annuity Mortality
Tables for Males.
Annual Compensation: The average of the total compensation
(retainer and meeting fees) received by an Independent Trustee
during each of the last three Plan Years preceding his termination
of services as such for which he served either as an Independent
Trustee or a Nonaffiliated Trustee for the entire year; provided,
that if an Independent Trustee served as an Independent Trustee
and/or a Nonaffiliated Trustee for fewer than three full Plan
Years prior to his termination of services, there shall be taken
into account his annualized compensation for the one or more most
recent partial Plan Years (if any) for which he served as an
Independent Trustee or a Nonaffiliated Trustee that, when
aggregated with his full Plan Years, does not exceed three Plan
Years.
Disability: Disability as defined in ss.22(e)(3) of the
Internal Revenue Code of 1986, as amended.
Independent Trustee: A Trustee of the Fund who is not an
"interested person" (as defined in Section 2(a)(19) of the
Investment Company Act of 1940, as amended) of the Fund,
Lifetime Advisers, Inc. ("Lifetime"), Massachusetts Financial
Services Company ("MFS") or MFS Financial Services, Inc. ("FSI").
Nonaffiliated Trustee: A Trustee of the Fund who has no
material business or professional relationship with the Fund,
Lifetime, MFS or FSI and who is subject
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to being declared an "interested person" solely by reason of
his relationship with the Fund, Lifetime, MFS or FSI during the
two most recently completed fiscal years of the Fund.
Normal Retirement Benefit: An annual benefit at Normal
Retirement Date equal to 5% of an Independent Trustee's Annual
Compensation multiplied by the Independent Trustee's whole Years
of Service, up to a maximum of ten Years of Service, payable in
the Normal Form of Benefit, as defined in ss.3(g).
Normal Retirement Date: December 31 of the Plan Year in
which an Independent Trustee attains age 73.
Plan Year: January 1 through December 31.
Retirement: Termination of service of an Independent Trustee
after having completed at least five Years of Service and having
attained age 62, other than: (i) any termination by reason of
death; (ii) any termination by reason of Disability, provided that
any Independent Trustee who suffers a Disability and who has
otherwise satisfied the requirements for Retirement shall have the
right to elect whether his termination is by reason of Retirement
or by reason of Disability; or (iii) any termination resulting
from the Independent Trustee's willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in
the conduct of the office of Independent Trustee ("Misconduct").
Year of Service: A Plan Year during which an Independent
Trustee completed at least six months of service as either a
Nonaffiliated Trustee or an Independent Trustee.
2. ELIGIBILITY
No Trustee of the Fund shall be eligible to participate in the
Plan or be entitled to any rights or benefits hereunder until the
Trustee becomes an Independent Trustee. Each individual who
completes any service as an Independent Trustee on or after the
Effective Date of this Plan, and who so elects in such manner as
the Committee determines from time to time, will be eligible to
participate in the Plan.
3. RETIREMENT DATE; AMOUNT OF BENEFIT
(a) Retirement. Each Independent Trustee shall retire on that
Independent Trustee's Normal Retirement Date, if he has not
previously ceased to perform services as an Independent
Trustee. Each retired Independent Trustee is referred to as
a "Retired Trustee".
(b) Normal Retirement Benefit. Upon an Independent Trustee's
Retirement on his Normal Retirement Date, the
Independent Trustee shall receive, commencing on his Normal
Retirement Date, his Normal Retirement Benefit.
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(c) Early Retirement Benefit. Upon an Independent Trustee's
Retirement prior to his Normal Retirement Date, the
Independent Trustee shall receive an Early Retirement Benefit
commencing on the Independent Trustee's date of Retirement.
The benefit payable on an Independent Trustee's early
Retirement shall be his Accrued Benefit reduced by 5% for
every year that payment of an Early Retirement Benefit
precedes that Trustee's Normal Retirement Date.
(d) Deferred Termination Benefit. If an Independent Trustee's
service as such terminates, other than (i)
termination as a result of his Misconduct or (ii) termination
that constitutes termination by reason of his Retirement,
Disability or death, after he has completed at least five
Years of Service, he shall receive, commencing on the date he
attains age 62, his Accrued Benefit reduced by 55%.
(e) Disability Benefit. If an Independent Trustee's service as
such terminates by reason of his Disability and, if the
Independent Trustee is eligible for Retirement, he elects
that his termination be treated as being by reason of
Disability, he shall receive his Accrued Benefit paid for the
one hundred twenty (120) months immediately following the
month in which his service so terminates. In the event the
Independent Trustee dies before he has received one hundred
twenty (120) payments, monthly payments in the same amount
shall be paid to his beneficiary until the number of payments
to the Independent Trustee plus the number of payments to the
beneficiary equal one hundred twenty (120) payments.
(f) Death Benefit. Each Independent Trustee who elects to
participate in this Plan shall designate a beneficiary in
such form as the Committee approves from time to time to
receive any benefits payable under this Plan in the event of
his death. In the event there is no validly
designated beneficiary in existence on the date of an
Independent Trustee's death, his beneficiary shall be his
surviving spouse, if any, or if none, his estate. The
beneficiary of an Independent Trustee who dies during service,
and with respect to whom benefit payments have not commenced,
shall be entitled to that Independent Trustee's Accrued
Benefit paid for the one hundred twenty (120) months
immediately following death.
(g) Form of Benefit. Except as otherwise provided in this ss.3,
benefits payable under this ss.3 shall be payable in the form
of a monthly annuity for the life of the Independent
Trustee, and, if the Independent Trustee dies before he
has received one hundred twenty (120) payments,
monthly payments in the same amount shall be payable to his
beneficiary until the number of payments to the Independent
Trustee plus the number of payments to the beneficiary equal
one hundred twenty (120) payments (the "Normal Form of
Benefit"). However,
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notwithstanding any other provision of this Section 3 to
the contrary, if an Independent Trustee's beneficiary
is entitled to payments under this Plan upon the
Independent Trustee's death, then (i) if the Independent
Trustee's beneficiary is his estate, the lump sum Actuarial
Equivalent present value of those payments shall be paid to
the estate in a single lump sum as soon as administratively
reasonable following the Independent Trustee's death, and (ii)
if the Independent Trustee's beneficiary is other than his
estate, the Committee in its sole discretion may direct that
the Actuarial Equivalent value of those payments be paid in
such form other than the Normal Form of Benefit (including
without limitation a lump sum) as it determines.
4. PAYMENT OF BENEFIT; ALLOCATION OF COSTS
The Fund is responsible for the payment of the benefits, as
well as all expenses of administration of the Plan,
including without limitation all accounting, legal and
actuarial fees and expenses. The obligations of the Fund to
pay such benefits and expenses will not be secured or funded
in any manner, and the obligations will not have any
preference over the lawful claims of the Fund's creditors
and shareholders. The Fund shall be under no obligation to
segregate any assets for the purpose of providing retirement
benefits pursuant to this Plan, and to the extent that any
Independent Trustee or beneficiary acquires a right to
receive a benefit under the Plan, such right shall be
limited to that of a recipient of an unfunded, unsecured
promise to pay amounts in the future and such person's
position with respect to such amounts shall be that of a
general unsecured creditor of the Fund. To the extent that
the Fund consists of one or more separate portfolios, costs
and expenses will be allocated among the portfolios by the
Board of Trustees of the Fund (the "Board") in a manner that
is determined by the Board to be fair and equitable under
the circumstances.
5. ADMINISTRATION
(a) The Committee. Any question involving entitlement to
payments under or the interpretation or administration
of the Plan will be referred to a committee (the
"Committee") of Independent Trustees designated by the
Board. Except as otherwise provided herein, the
Committee will make all interpretations and
determinations necessary or desirable for the Plan's
administration, and such interpretations and
determinations will be final and conclusive.
(b) Powers of the Committee. The Committee will represent
and act on behalf of the Fund in respect of the Plan
and, subject to the other provisions of the Plan, the
Committee may adopt, amend or repeal by-laws or
other regulations, relating to the administration of the
Plan, the conduct of the Committee's affairs, its rights
or powers or the rights or powers of its members or of
the Board. The Committee will report to the
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Board from time to time on its activities in respect of
the Plan. The Committee or persons designated by it will
cause such records to be kept as may be necessary for the
administration of the Plan.
6. MISCELLANEOUS PROVISIONS
(a) Rights Not Assignable. The right to receive any payment
under the Plan may not be transferred, assigned, pledged
or otherwise alienated.
(b) Amendment, etc. The Committee, with the concurrence of
the Board, may at any time amend or terminate the Plan
or waive any provision of the Plan, provided that no
amendment, termination or waiver will impair the rights
of an Independent Trustee to receive upon Retirement the
payments which would have been made to that Independent
Trustee had there been no such amendment, termination
or waiver (based upon that Independent Trustee's Years of
Service to the date of such amendment, termination or
waiver) or the rights of a former Independent Trustee or
Retired Trustee to receive any benefit due under the
Plan, without the consent of such present or former
Independent Trustee or Retired Trustee, as the case may
be. A present or former Independent Trustee or
Retired Trustee may elect to waive receipt of his benefit
by so advising the Committee.
Notwithstanding any provision of this Plan to the contrary,
however, in the event of the sale of all or substantially
all of the assets of the Fund, the liquidation or
dissolution of the Fund, or any merger or other similar
reorganization of the Fund that the Fund does not survive:
(i) if although the Fund does not survive there is a
surviving entity, all rights and benefits
(including without limitation those of Retired
Trustees) under the Plan shall cease upon
consummation of such transaction, unless, and only
to the extent that, the board of trustees (or other
similar governing body) of the surviving entity
agrees to assume the Plan and/or to provide any such
rights or benefits; and
(ii) if there is no surviving entity, the Board shall
have the right to take specific action to
terminate the Plan and/or to cause any or all rights
and benefits (including without limitation those of
Retired Trustees) under the Plan to cease as of the
date of such event but, in the absence of any such
specific action, the lump sum Actuarial Equivalent
present value of the Accrued Benefit of each present
or former Independent Trustee or Retired Trustee (or
beneficiary thereof) who on the date of liquidation
is receiving or entitled to receive a benefit under
the Plan or would be entitled to receive a benefit
under the Plan based on his actual or deemed
termination of service as of the date of such
liquidation shall be paid to such person.
(c) No Right to Re-election. Nothing in the Plan will
create any obligation on the part of the Board to
nominate any Independent Trustee for re-election.
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(d) Vacancies. Although the Board will retain the
right to increase or decrease its size, it shall be the
general policy of the Board to replace each person who
ceases to serve as an Independent Trustee by
selecting a new Independent Trustee from candidates
duly proposed.
(e) Consulting. Each Retired Trustee may render such
services for the Fund, for such compensation, as may
be agreed upon from time to time by such Trustee and
the Board of the Fund.
(f) Construction. Whenever any masculine terminology
is used in this Plan, it shall be taken to include
the feminine, unless the context otherwise indicates.
The titles and headings included herein are for
convenience only and shall not be construed as in any
way affecting or modifying the text of this Plan,
which text shall control. This Plan shall be construed
and regulated in accordance with the laws of The
Commonwealth of Massachusetts, except to the extent
such state law is preempted by federal law.
(g) Effective Date. This Plan will become effective
on January 1, 1991 (the "Effective Date").
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EXHIBIT NO. 99(j)(1)
CUSTODIAN CONTRACT
Between
MFS MUNICIPAL INCOME TRUST
and
STATE STREET BANK AND TRUST COMPANY
<PAGE>
TABLE OF CONTENTS
PAGE
1. Employment of Custodian and Property to be Held By It 1
2. Duties of the Custodian with Respect to Property of the
Trust Held by the Custodian 2
2.1 Holding Securities 2
2.2 Delivery of Securities 2
2.3 Registration of Securities 7
2.4 Bank Accounts 7
2.5 Investment and Availability of Federal Funds 8
2.6 Collection of Income 9
2.7 Payment of Trust Monies 9
2.8 Liability for Payment in Advance of Receipt of
Securities Purchased 12
2.9 Appointment of Agents 12
2.10 Deposit of Trust Assets in Securities System 13
2.11 Segregated Account 16
2.12 Ownership Certificates for Tax Purposes 17
2.13 Proxies 17
2.14 Communications Relating to Trust Portfolio Securities 18
2.15 Proper Instructions 18
2.16 Actions Permitted Without Express Authority 19
2.17 Evidence of Authority 20
3. Duties of the Custodian with Respect to the Books of Account
and Calculation of Net Asset Value and Net Income 20
4. Records 21
5. Opinion of Trust's Independent Accountant 22
6. Reports to Trust by Independent Public Accountants 22
7. Compensation of Custodian 22
8. Responsibility of Custodian 23
9. Effective Period, Termination and Amendment 24
10. Successor Custodian 25
11. Interpretive and Additional Provisions 27
12. Massachusetts Law to Apply 27
13. Prior Contracts 27
<PAGE>
CUSTODIAN CONTRACT
This Contract between MFS Municipal Income Trust, a business trust
organized and existing under the laws of The Commonwealth of Massachusetts,
having its principal place of business at 200 Berkeley Street, Boston,
Massachusetts, hereinafter called the "Trust", and State Street Bank and Trust
Company, a Massachusetts trust company, having its principal place of business
at 225 Franklin Street, Boston, Massachusetts, 02110, hereinafter called the
"Custodian",
WITNESSETH:
WITNESSETH: That in consideration of the mutual covenants
and agreements hereinafter contained, the parties hereto agree as
follows:
1. Employment of Custodian and Property to be Held by It
The Trust hereby employs the Custodian as the custodian of
the assets pursuant to the provisions of the Declaration of Trust. The Trust
agrees to deliver to the Custodian all securities and cash owned by it, and all
payments of income, payments of principal or capital distributions received by
it with respect to all securities owned by the Trust from time to time, and the
cash consideration received by it for such shares of beneficial interest,
("Shares") of the Trust as may be issued or sold from time to time. The
Custodian shall not be responsible for any property of the Trust held or
received by the Trust and not delivered to the Custodian.
Upon receipt of "Proper Instructions" (within the meaning of Section
2.15), the Custodian shall from time to time employ one or more sub-custodians,
but only in accordance with an
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applicable vote by the Board of Trustees of the Trust, and provided
that the Custodian shall have no more or less responsibility or
liability to the Trust on account of any actions or omissions of any
sub-custodian so employed than any such sub-custodian has to the
Custodian.
2. Duties of the Custodian with Respect to Property of the
Trust Held By the Custodian.
2.1 Holding Securities. The Custodian shall hold and physically
segregate for the account of the Trust all non-cash property, including
all securities owned by the Trust, other than securities which are
maintained pursuant to Section 2.10 in a clearing agency which acts as
a securities depository or in a book-entry system authorized by the
U.S. Department of the Treasury, collectively referred to herein as a
"Securities System".
2.2 Delivery of Securities. The Custodian shall release and deliver
securities owned by the Trust held by the Custodian or in a Securities
System account of the Custodian only upon receipt of Proper
Instructions, which may be continuing instructions when deemed
appropriate by the parties, and only in the following cases:
1) Upon sale of such securities for the account of the Trust
and receipt of payment therefor;
2) Upon the receipt of payment in connection with any
repurchase agreement related to such securities entered
into by the Trust;
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3) In the case of a sale effected through a Securities
System, in accordance with the provisions of Section 2.10
hereof;
4) To the depository agent in connection with tender or other
similar offers for portfolio securities of the Trust;
5) To the issuer thereof or its agent when such
securities are called, redeemed, retired or otherwise
become payable; provided that, in any such case, the cash
or other consideration is to be delivered to the
Custodian;
6) To the issuer thereof, or its agent, for transfer into
the name of the Trust or into the name of any nominee
or nominees of the Custodian or into the name or nominee
name of any agent appointed pursuant to Section 2.9 or
into the name or nominee name of any sub-custodian
appointed pursuant to Article 1; or for exchange for a
different number of bonds, certificates or other evidence
representing the same aggregate face amount or number of
units; provided that, in any such case, the new securities
are to be delivered to the Custodian;
7) Upon the sale of such securities for the account of the
Trust, to the broker or its
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clearing agent, against a receipt, for
examination in accordance with "street delivery" custom;
provided that in any such case, the Custodian shall have
no responsibility or liability for any loss arising from
the delivery of such securities prior to receiving payment
for such securities except as may arise from the
Custodian's own negligence or willful misconduct;
8) For exchange or conversion pursuant to any plan of
merger, consolidation, recapitalization, reorganization or
readjustment of the securities of the issuer of such
securities, or pursuant to provisions for conversion
contained in such securities, or pursuant to any deposit
agreement; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the
Custodian;
9) In the case of warrants, rights or similar
securities, the surrender thereof in the exercise of such
warrants, rights or similar securities or the surrender of
interim receipts or temporary securities for definitive
securities; provided that, in any such case, the new
securities and cash, if any, are to be delivered to the
Custodian;
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10) For delivery in connection with any loans of
securities made by the Trust, but only against receipt of
adequate collateral as agreed upon from time to time by
the Custodian and the Trust, which may be in the form of
cash or obligations issued by the United States
government, its agencies or instrumentalities, except that
in connection with any loans for which collateral is to be
credited to the Custodian's account in the book-entry
system authorized by the U.S. Department of the Treasury,
the Custodian will not be held liable or responsible for
the delivery of securities owned by the Trust prior to the
receipt of such collateral;
11) For delivery as security in connection with any
borrowings by the Trust requiring a pledge of assets by
the Trust, but only against receipt of amounts borrowed;
12) For delivery in accordance with the provisions of
any agreement among the Trust, the Custodian and a
broker-dealer registered under the Securities Exchange Act
of 1934 (the "Exchange Act") and a member of The National
Association of Securities Dealers, Inc. ("NASD"), relating
to compliance with the rules of The Options Clearing
Corporation
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and of any registered national securities exchange,
or of any similar organization or organizations,
regarding escrow or other arrangements in connection with
transactions by the Trust;
13) For delivery in accordance with the provisions of any
agreement among the Trust, the Custodian, and a
Futures Commission Merchant registered under the Commodity
Exchange Act, relating to compliance with the rules of the
Commodity Futures Trading Commission and/or any Contract
Market, or any similar organization or organizations,
regarding account deposits in connection with transactions
by the Trust; and
14) For any other proper corporate purpose, but only
upon receipt of, in addition to Proper Instructions, a
certified copy of a resolution of the Board of Trustees or
of the Executive Committee signed by an officer of the
Trust and certified by the Secretary or an Assistant
Secretary, setting forth the purpose for which such
delivery is to be made, declaring such purpose to be
proper corporate purpose, and naming the person or persons
to whom delivery of such securities shall be made.
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2.3 Registration of Securities. Securities held by the
Custodian (other than bearer securities) shall be registered
in the name of the Trust or in the name of any nominee of
the Trust or of any nominee of the Custodian which nominee
shall be assigned exclusively to the Trust, unless the Trust
has authorized in writing the appointment of a nominee to be
used in common with other registered investment companies
having the same investment adviser as the Trust, or in the
name or nominee name of any agent appointed pursuant to
Section 2.9 or in the name or nominee name of any
sub-custodian appointed pursuant to Article 1. All
securities accepted by the Custodian on behalf of the Trust
under the terms of this Contract shall be in "street name"
or other good delivery form.
2.4 Bank Accounts. The Custodian shall open and maintain a
separate bank account or accounts (the "Trust's Account or
Accounts") in the name of the Trust, subject only to draft
or order by the Custodian acting pursuant to the terms of
this Contract, and shall hold in such Account or Accounts,
subject to the provisions hereof, all cash received by it
from or for the Account of the Trust, other than cash
maintained by the Trust in a bank Account established and
used in accordance with Rule 17f-3 under the Investment
Company Act of 1940. Funds held by the Custodian for the
Trust may be deposited by it to its credit as Custodian in
the Banking Department of the
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Custodian or in such other banks or trust companies as it may in its
discretion deem necessary or desirable; provided, however, that every
such bank or trust company shall be qualified to act as a custodian
under the Investment Company Act of 1940 and that each such bank or
trust company and the funds to be deposited with each such bank or
trust company be approved by vote of a majority of the Board of
Trustees of the Trust. Such funds shall be deposited by the Custodian
in its capacity as Custodian and shall be withdrawable by the Custodian
only in that capacity.
2.5 Investment and Availability of Federal Funds. Upon mutual
agreement between the Trust and the Custodian, the Custodian
shall, upon the receipt of Proper Instructions,
1) invest in such instruments as may be set forth in
such instruments as may be set forth in such
instructions on the same day as received all federal
funds received after a time agreed upon the Custodian
and the Trust; and
2) make federal funds available to the Trust as of
specified times agreed upon from time to time by the
Trust and the Custodian in the amount of checks
received in payment for Shares of the Trust which are
deposited into the Trust's account.
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2.6 Collection of Income. The Custodian shall collect on a
timely basis all income and other payments with respect to
registered securities held hereunder to which the Trust
shall be entitled either by law or pursuant to custom in the
securities business, and shall collect on a timely basis all
income and other payments with respect to bearer securities
if, on the date of payment by the issuer, such securities
are held by the Custodian or agent thereof and shall credit
such income, as collected, to such Trust's custodian
Account. Without limiting the generality of the foregoing,
the Custodian shall detach and present for payment all
coupons and other income items requiring presentation as and
when they become due and shall collect interest when due on
securities held hereunder. Income due the Trust on
securities loaned pursuant to the provisions of Section 2.2
(10) shall be the responsibility of the Trust. The
Custodian will have no duty or responsibility in connection
therewith, other than to provide the Trust with such
information or data as may be necessary to assist the Trust
in arranging for the timely delivery to the Custodian of the
income to which the Trust is properly entitled.
2.7 Payment of Trust Monies. Upon receipt of Proper Instructions, which may
be continuing instructions when deemed appropriate by the parties, the
Custodian shall pay out monies of the Trust in the following cases
only:
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1) Upon the purchase of securities, for the account of
the Trust but only (a) against the delivery of such
securities to the Custodian (or any bank, banking firm or
trust company doing business in the United States or abroad
which is qualified under the Investment Company Act of 1940,
as amended, to act as a custodian and has been designated by
the Custodian as its agent for this purpose) registered in
the name of the Trust or in the name of a nominee of the
Custodian referred to in Section 2.3 hereof or in proper
form for transfer; (b) in the case of a purchase effected
through a Securities System, in accordance with the
conditions set forth in Section 2.10 hereof; or (c) in the
case of repurchase agreements entered into between the Trust
and the Custodian, or another bank, or a broker-dealer which
is a member of NASD, (i) against delivery of the securities
either in certificate form or through an entry crediting the
Custodian's account at the Federal Reserve Bank with such
securities or (ii) against delivery of the receipt
evidencing purchase by the Trust of securities owned by the
Custodian along with written evidence of the agreement by
the
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Custodian to repurchase such securities from the Trust;
2) In connection with conversion, exchange or surrender of
securities owned by the Trust as set forth in Section 2.2
hereof;
3) For the payment of any expense or liability
incurred by the Trust, including but not limited to the
following payments for the account of the Trust: interest,
taxes, management, accounting, transfer agent and legal
fees, and operating expenses of the Trust whether or not
such expenses are to be in whole or part capitalized or
treated as deferred expenses;
4) For the payment of any dividends declared pursuant to the
governing documents of the Trust;
5) For payment of the amount of dividends received in respect
of securities sold short;
6) For any other proper purpose, but only upon
receipt of, in addition to Proper Instructions, a
certified copy of a resolution of the Board of Trustees or
of the Executive Committee of the Trust signed by an
officer of the Trust and certified by its Secretary or an
Assistant Secretary, setting forth the purpose for which
such payment is
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to be made, declaring such purpose to be a proper purpose,
and naming the person or persons to whom such payment is to
be made.
2.8 Liability for Payment in Advance of Receipt of Securities
Purchased. In any and every case where payment for purchase
of securities for the account of the Trust is made by the
Custodian in advance of receipt of the securities purchased
in the absence of specific written instructions from the
Trust to so pay in advance, the Custodian shall be
absolutely liable to the Trust for such securities to the
same extent as if the securities had been received by the
Custodian, except that in the case of repurchase agreements
entered into by the Trust with a bank which is a member of
the Federal Reserve System, the Custodian may transfer funds
to the account of such bank prior to the receipt of written
evidence that the securities subject to such repurchase
agreements, have been transferred by book-entry into a
segregated non-proprietary account of the Custodian
maintained with the Federal Reserve Bank of Boston or of the
safekeeping receipt, provided that such securities have in
fact been so transferred by book-entry.
2.9 Appointment of Agents. The Custodian may at any time or times in its
discretion appoint (and may at any time remove) any other bank or trust
company which is itself qualified under the Investment Company Act of
1940, as amended, to act as a custodian, as its agent to carry out
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such of the provisions of this Article 2 as the Custodian may from time
to time direct; provided, however, that the appointment of any agent
shall not relieve the Custodian of its responsibilities or liabilities
hereunder.
2.10 Deposit of Trust Assets in Securities Systems. The
Custodian may deposit and/or maintain securities owned by
the Trust in a clearing agency registered with the
Securities and Exchange Commission under Section 17A of the
Securities Exchange Act of 1934, which acts as a securities
depository, or in the book-entry system authorized by the
U.S. Department of the Treasury and certain federal
agencies, collectively referred to herein as "Securities
System" in accordance with applicable Federal Reserve Board
and Securities and Exchange Commission rules and
regulations, if any, and subject to the following provisions:
1) The Custodian may keep securities of the Trust in
a Securities System provided that such securities are
represented in an account ("Custodian's Account") of the
Custodian in the Securities System which shall not include
any assets of the Custodian other than assets held as a
fiduciary, custodian or otherwise for customers;
2) The records of the Custodian with respect to securities
of the Trust which are maintained in a Securities System
shall identify by
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book-entry those securities belonging to the Trust;
3) The Custodian shall pay for securities purchased
for the account of the Trust upon (i) receipt of advice
from the Securities System that such securities have been
transferred to the Custodian's Account, and (ii) the
making of an entry on the records of the Custodian to
reflect such payment and transfer for the account of the
Trust. The Custodian shall transfer securities sold for
the account of the Trust upon (i) receipt of advice from
the Securities System that payment for such securities has
been transferred to the Custodian's Account, and (ii) the
making of an entry on the records of the Custodian to
reflect such transfer and payment for the account of the
Trust. Copies of all advices from the Securities System of
transfers of securities for the account of the Trust shall
identify the Trust, be maintained for the Trust by the
Custodian and be provided to the Trust at its request.
Upon request, the Custodian shall furnish the Trust
confirmation of each transfer to or from the account of
the Trust in the form of a written advice or notice and
shall furnish
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to the Trust copies of daily transaction sheets
reflecting each day's transactions in the
Securities System for the account of the Trust.
4) The Custodian shall provide the Trust with any
report obtained by the Custodian on the Securities
System's accounting system, internal accounting control
and procedures for safeguarding securities deposited in
the Securities System;
5) The Custodian shall have received the initial or annual
certificate, as the case may be, required by Article 9
hereof;
6) Anything to the contrary in this Contract
notwithstanding, the Custodian shall be liable to the
Trust for any loss or damage to the Trust resulting from
use of the Securities System by reason of any negligence,
misfeasance or misconduct of the Custodian or any of its
agents or of any of its or their employees or from failure
of the Custodian or any such agent to enforce effectively
such rights as it may have against the Securities System;
at the election of the Trust, it shall be entitled to be
subrogated to the rights of the Custodian with respect to
any claim against
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the Securities System or any other person
which the Custodian may have as a consequence of any such
loss or damage if and to the extent that the Trust has not
been made whole for any such loss or damage.
2.11 Segregated Account. The Custodian shall upon receipt of
Proper Instructions establish and maintain a segregated
account or accounts for and on behalf of the Trust, into
which account or accounts may be transferred cash and/or
securities, including securities maintained in an account by
the Custodian pursuant to Section 2.10 hereof, (i) in
accordance with the provisions of any agreement among the
Trust, the Custodian and a broker-dealer registered under
the Exchange Act and a member of the NASD (or any futures
commission merchant registered under the Commodity Exchange
Act), relating to compliance with the rules of The Options
Clearing Corporation and of any registered national
securities exchange (or the Commodity Futures Trading
Commission or any registered contract market), or of any
similar organization or organizations, regarding escrow or
other arrangements in connection with transactions by the
Trust, (ii) for purposes of segregating cash or government
securities in connection with options purchased, sold or
written by the Trust or commodity futures contracts or
options thereon purchased or sold by the Trust, (iii) for
the purposes of compliance by the Trust with the procedures
required by
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Investment Company Act Release No. 10666, or any subsequent release or
releases of the Securities and Exchange Commission relating to the
maintenance of segregated accounts by registered investment companies
and (iv) for other proper corporate purposes, but only, in the case of
clause (iv), upon receipt of, in addition to Proper Instructions, a
certified copy of a resolution of the Board of Trustees or of the
Executive Committee signed by an officer of the Trust and certified by
the Secretary or an Assistant Secretary, setting forth the purpose or
purposes of such segregated account and declaring such purposes to be
proper corporate purposes.
2.12 Ownership Certificates for Tax Purposes. The Custodian shall execute
ownership and other certificates and affidavits for all federal and
state tax purposes in connection with receipt of income or other
payments with respect to securities of the Trust held by it and in
connection with transfers of securities.
2.13 Proxies. The Custodian shall, with respect to the
securities held hereunder, cause to be promptly executed by
the registered holder of such securities, if the securities
are registered otherwise than in the name of the Trust or a
nominee of the Trust, all proxies, without indication of the
manner in which such proxies are to be voted, and shall
promptly deliver to the Trust such proxies, all proxy
soliciting materials and all notices relating to such
securities.
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2.14 Communications Relating to Trust Portfolio Securities. The
Custodian shall transmit promptly to the Trust all written
information (including, without limitation, pendency of
calls and maturities of securities and expirations of rights
in connection therewith and notices of exercise of call and
put options written by the Trust and the maturity of futures
contracts purchased or sold by the Trust) received by the
Custodian from issuers of the securities being held for the
Trust. With respect to tender or exchange offers, the
Custodian shall transmit promptly to the Trust all written
information received by the Custodian from issuers of the
securities whose tender or exchange is sought and from the
party (or his agents) making the tender or exchange offer.
If the Trust desires to take action with respect to any
tender offer, exchange offer or any other similar
transaction, the Trust shall notify the Custodian at least
three business days prior to the date on which the Custodian
is to take such action.
2.15 Proper Instructions. Proper Instructions as used throughout
this Article 2 means a writing signed or initialled by one
or more person or persons as the Board of Trustees shall
have from time to time authorized. Each such writing shall
set forth the specific transaction or type of transaction
involved, including a specific statement of the purpose for
which such action is requested. Oral instructions will be
considered
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Proper Instructions if the Custodian reasonably believes them to have
been given by a person authorized to give such instructions with
respect to the transaction involved. The Trust shall cause all oral
instructions to be confirmed in writing. Upon receipt of a certificate
of the Secretary or an Assistant Secretary as to the authorization by
the Board of Trustees of the Trust accompanied by a detailed
description of procedures approved by the Board of Trustees, Proper
Instructions may include communications effected directly between
electro-mechanical or electronic devices provided that the Board of
Trustees and the Custodian are satisfied that such procedures afford
adequate safeguards for the Trust's assets.
2.16 Actions Permitted without Express Authority. The Custodian
may in its discretion, without express authority from the
Trust:
1) make payments to itself or others for minor
expenses of handling securities or other similar items
relating to its duties under this Contract, provided
that all such payments shall be accounted for to the
Trust;
2) surrender securities in temporary form for securities
in definitive form;
3) endorse for collection, in the name of the Trust,
checks, drafts and other negotiable instruments; and
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4) in general, attend to all non-discretionary
details in connection with the sale, exchange,
substitution, purchase, transfer and other dealings with
the securities and property of the Trust except as
otherwise directed by the Board of Trustees of the
Trust.
2.17 Evidence of Authority. The Custodian shall be protected in acting upon any
instructions, notice, request, consent, certificate or other instrument or paper
believed by it to be genuine and to have been properly executed by or on behalf
of the Trust. The Custodian may receive and accept a certified copy of a vote of
the Board of Trustees of the Trust as conclusive evidence (a) of the authority
of any person to act in accordance with such vote or (b) of any determination or
of any action by the Board of Trustees pursuant to the Declaration of Trust as
described in such vote, and such vote may be considered as in full force and
effect until receipt by the Custodian of written notice to the contrary.
3. Duties of the Custodian with Respect to the Books of Account and
Calculation of Net Asset Value and Net Income.
The Custodian shall cooperate with and supply necessary information to the
entity or entities appointed by the Board of Trustees of the Trust to keep the
books of account of the Trust and/or compute the net asset value per share of
the outstanding shares of the Trust or, if directed in writing to do so by the
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Trust, shall itself keep such books of account and/or compute such net asset
value per share. If so directed, the Custodian shall also calculate weekly the
net income of the Trust as described in the Trust's currently effective
prospectus and shall advise the Trust and the Transfer Agent weekly of the total
amounts of such net income and, if instructed in writing by an officer of the
Trust to do so, shall advise the Transfer Agent periodically of the division of
such net income among its various components. The calculations of the net asset
value per share and the weekly income of the Trust shall be made at the time or
times described from time to time in the Trust's currently effective prospectus.
4. Records
The Custodian shall create and maintain all records relating to its
activities and obligations under this Contract in such manner as will meet the
obligations of the Trust under the Investment Company Act of 1940, with
particular attention to Section 31 thereof and Rules 31a-1 and 31a-2 thereunder,
applicable federal and state tax laws and any other law or administrative rules
or procedures which may be applicable to the Trust. All such records shall be
the property of the Trust and shall at all times during the regular business
hours of the Custodian be open for inspection by duly authorized officers,
employees or agents of the Trust and employees and agents of the Securities and
Exchange Commission. The Custodian shall, at the Trust's request, supply the
Trust with a tabulation of securities owned by the Trust and held by the
Custodian and shall, when
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requested to do so by the Trust and for such compensation as shall be
agreed upon between the Trust and the Custodian, include certificate
numbers in such tabulations.
5. Opinion of Trust's Independent Accountant
The Custodian shall take all reasonable action, as the Trust
may from time to time request, to obtain from year to year favorable
opinions from the Trust's independent accountants with respect to its
activities hereunder in connection with the preparation of the
Trust's Form N-2, and Form N-SAR or other annual reports to the
Securities and Exchange Commission and with respect to any other
requirements of such Commission.
6. Reports to Trust by Independent Public Accountants
The Custodian shall provide the Trust, at such times as the
Trust may reasonably require, with reports by independent public
accountants on the accounting system, internal accounting control and
procedures for safeguarding securities, futures contracts and options
on futures contracts, including securities deposited and/or
maintained in a Securities System, relating to the services provided
by the Custodian under this Contract; such reports, shall be of
sufficient scope and in sufficient detail, as may reasonably be
required by the Trust, to provide reasonable assurance that any
material inadequacies would be disclosed by such examination, and, if
there are no such inadequacies, the reports shall so state.
7. Compensation of Custodian
The Custodian shall be entitled to reasonable compensation for its
services and expenses as Custodian, as agreed upon from time to time between the
Trust and the Custodian.
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8. Responsibility of Custodian
So long as and to the extent that it is in the exercise of reasonable
care, the Custodian shall not be responsible for the title, validity or
genuineness of any property or evidence of title thereto received by it or
delivered by it pursuant to this Contract and shall be held harmless in acting
upon any notice, request, consent, certificate or other instrument reasonably
believed by it to be genuine and to be signed by the proper party or parties.
The Custodian shall be held to the exercise of reasonable care in carrying out
the provisions of this Contract and shall be indemnified by the Trust for any
action taken or omitted by it in the proper execution of instructions from the
Trust. It shall be entitled to rely on and may act upon advice of counsel for
the Trust on all matters and shall be without liability for any action
reasonably taken or omitted pursuant to such advice.
The Trust agrees to indemnify and hold harmless the Custodian and its
nominee from and against all taxes, charges, expenses, assessments, claims and
liabilities (including counsel fees) incurred or assessed against it or its
nominee in connection with the performance of this Contract, except such as may
arise from it or its nominee's own negligent action, negligent failure to act or
willful misconduct. The Custodian is authorized to charge any account of the
Trust for such items and its fees. To secure any such authorized charges and any
advances of cash or securities made by the Custodian to or for the benefit of
the Trust for any purpose which results in the Trust incurring
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an overdraft at the end of any business day or for extraordinary or emergency
purposes during any business day, the Trust on behalf of the Portfolio hereby
grants to the Custodian a security interest in and pledges to the Custodian
securities held for it by the Custodian, in an amount not to exceed five percent
of the applicable Trust's gross assets, the specific securities to be designated
in writing from time to time by the Trust or its investment adviser (the
"Pledged Securities"). Should the Trust fail to repay promptly any advances of
cash or securities, the Custodian shall be entitled to use available cash and to
dispose of the Pledged Securities as is necessary to repay any such advances.
9. Effective Period. Termination and Amendment
This Contract shall become effective as of its execution, shall
continue in full force and effect until terminated as hereinafter provided, may
be amended at any time by mutual agreement of the parties hereto and may be
terminated by either party by an instrument in writing delivered or mailed,
postage prepaid to the other party, such termination to take effect not sooner
than thirty (30) days after the date of such delivery or mailing; provided,
however that the Custodian shall not act under Section 2.10 hereof in the
absence of receipt of an initial certificate of the Secretary or an Assistant
Secretary that the Board of Trustees of the Trust has approved the initial use
of a particular Securities System and the receipt of an annual certificate of
the Secretary or an Assistant Secretary that the Board of Trustees has reviewed
the use by the Trust of such Securities System, as required in each case by Rule
17f-4 under
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the Investment Company Act of 1940, as amended and; provided further, however,
(a) that the Trust shall not amend or terminate this Contract in contravention
of any applicable federal or state regulations, or any provision of the
Declaration of Trust, and (b) that the Trust may at any time by action of its
Board of Trustees (i) substitute another bank or trust company for the Custodian
by giving notice as described above to the Custodian, or (ii) immediately
terminate this Contract in the event of the appointment of a conservator or
receiver for the Custodian or upon the happening of a like event at the
direction of an appropriate regulatory agency or court of competent
jurisdiction.
Upon termination of the Contract, the Trust shall pay to the
Custodian such compensation as may be due as of the date of such
termination and shall likewise reimburse the Custodian for its costs,
expenses and disbursements.
10. Successor Custodian
If a successor custodian shall be appointed by the Board of Trustees of
the Trust, the Custodian shall, upon termination, deliver to such successor
custodian at the office of the Custodian, duly endorsed and in the form for
transfer, all securities then held by it hereunder and shall transfer to an
account of the successor custodian all of the Trust's securities held in a
Securities System.
If no such successor custodian shall be appointed, the Custodian shall,
in like manner, upon receipt of a certified copy of a vote of the Board of
Trustees of the Trust, deliver at the office of the Custodian and transfer such
securities, funds and other properties in accordance with such vote.
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In the event that no written order designating a successor custodian or
certified copy of a vote of the Board of Trustees shall have been delivered to
the Custodian on or before the date when such termination shall become
effective, then the Custodian shall have the right to deliver to a bank or trust
company, which is a "bank" as defined in the Investment Company Act of 1940, of
its own selection, having an aggregate capital, surplus, and undivided profits,
as shown by its last published report, of not less than $25,000,000, all
securities, funds and other properties held by the Custodian and all instruments
held by the Custodian relative thereto and all other property held by it under
this Contract and to transfer to an account of such successor custodian all of
the Trust's securities held in any Securities System. Thereafter, such bank or
trust company shall be the successor of the Custodian under this Contract.
In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Trust to procure the certified copy of the vote referred to or of
the Board of Trustees to appoint a successor custodian, the Custodian shall be
entitled to fair compensation for its services during such period as the
Custodian retains possession of such securities, funds and other properties and
the provisions of this Contract relating to the duties and obligations of the
Custodian shall remain in full force and effect.
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11. Interpretive and Additional Provisions
In connection with the operation of this Contract, the
Custodian and the Trust may from time to time agree on such provisions
interpretive of or in addition to the provisions of this Contract as may in
their joint opinion be consistent with the general tenor of this Contract. Any
such interpretive or additional provisions shall be in a writing signed by both
parties and shall be annexed hereto, provided that no such interpretive or
additional provisions shall contravene any applicable federal or state
regulations or any provision of the Declaration of Trust of the Trust. No
interpretive or additional provisions made as provided in the preceding sentence
shall be deemed to be an amendment of this Contract.
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12. Massachusetts Law to Apply
This Contract shall be construed and the provisions thereof
interpreted under and in accordance with laws of The Commonwealth of
Massachusetts.
13. Prior Contracts
This Contract supersedes and terminates, as of the date hereof, all
prior contracts between the Trust and the Custodian relating to the custody of
the Trust's assets.
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<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this instrument to
be executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the 19th day of February, 1988.
ATTEST MFS MUNICIPAL INCOME TRUST
ILLEGIBLE By: RICHARD B. BAILEY
(Illegible) Richard B. Bailey
ATTEST STATE STREET BANK & TRUST COMPANY
J. FARRELL By: ILLEGIBLE
J. Farrell, Assistant Secretary (Illegible), Vice President
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<PAGE>
EXHIBIT NO. 99(j)(2)
AMENDMENT TO CUSTODIAN CONTRACT
Agreement made as of this 1st day of October, 1989 by and between State
Street Bank and Trust Company (the "Custodian") and MFS Municipal Income Trust
(the "Trust").
WHEREAS, the Custodian and the Trust are parties to a Custodian
Contract dated February 19, 1988 (the "Custodian Contract") which governs the
terms and conditions under which the Custodian maintains custody of the
securities and other assets of the Trust;
WHEREAS, the Custodian may delegate to Massachusetts Financial Services
Company ("MFS") the performance of certain duties the Custodian would otherwise
be obligated to perform pursuant to the Custodian Agreement;
WHEREAS, the Trust agrees to any such delegation of certain
Custodian duties;
NOW THEREFORE, the Custodian and the Trust hereby amend the terms of
the Custodian Contract and mutually agree to the following:
1) Add new Section 14 which shall read as follows:
14. Delegation of Certain Custodian Duties to MFS
The Custodian may delegate to MFS the performance of any or
all of its duties hereunder relating to (i) accounting for investments
in currency and for financial instruments (including, without
limitation, options, contracts, futures contracts, options on futures
contracts, options on foreign currency and forward foreign currency
exchange contracts and (ii) federal and state regulatory compliance.
The Custodian shall compensate MFS for the performance of such duties
at such fee or fees as MFS shall determine to be equal to MFS's cost
for performing such duties (the "MFS Fees"). Following its payment of
the MFS Fees to MFS, the Custodian shall recover the amount of the MFS
Fees and from the Trust on such terms as the Custodian and the Trust
shall agree. MFS assumes responsibility for all duties delegated to it
by the Custodian pursuant to this Section 14, and the Custodian may
rely on MFS for the accuracy and correctness of the accounting
information provided by MFS to the Custodian pursuant to this Section
14.
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto have caused this
instrument to be executed in its name and on its behalf by a duly authorized
representative as of the aforementioned day and year.
ATTEST MFS MUNICIPAL INCOME TRUST
LINDA J. HOARD By: A. KEITH BRODKIN
Linda J. Hoard A. Keith Brodkin
ATTEST STATE STREET BANK & TRUST COMPANY
ILLEGIBLE By: PHYLLIS AHEARN
(Illegible) Phyllis Ahearn
Assistant Secretary Vice President
<PAGE>
EXHIBIT NO. 99(j)(3)
AMENDMENT
The Custodian Contract dated February 19, 1988 between MFS Municipal
Income Trust (referred to herein as the "Trust") and State Street Bank and Trust
Company (the "Custodian") is hereby amended as follows:
I. Section 2.1 is amended to read as follows:
"Holding Securities. The Custodian shall hold and
physically segregate for the account of the Trust all non-cash property,
including all securities owned by the Trust, other than (a) securities which are
maintained pursuant to Section 2.10 in a clearing agency which acts as a
securities depository or in a book-entry system authorized by the U.S.
Department of the Treasury, collectively referred to herein as "Securities
System" and (b) commercial paper of an issuer for which State Street Bank and
Trust Company acts as issuing and paying agent ("Direct Paper") which is
deposited and/or maintained in the Direct Paper System of the Custodian pursuant
to Section 2.10A.
II. Section 2.2 is amended to read, in relevant part as
follows:
"Delivery of Securities. The Custodian shall
release and deliver securities owned by the Trust held by the
Custodian or in a Securities System account of the Custodian or in the
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Custodian's Direct Paper book entry system account ("Direct Paper System
Account") only upon receipt of Proper Instructions, which may be continuing
instructions when deemed appropriate by the parties, and only in following
cases:
1) . . . .
.
.
.
14) . . . ."
III. Section 2.7(1) is amended to read in relevant part
as follows:
"Payment of Trust Monies. Upon receipt of Proper
Instructions, which may be continuing instructions when deemed
appropriate by the parties, the Custodian shall pay out monies of the
Trust in the following cases only:
1) Upon the purchase of securities, options,
futures contracts or options on futures contracts for
the account of the Trust but only (a) against the
delivery of such securities or evidence of title to
such options, futures contracts or options on futures
contracts, to the Custodian (or any bank, banking
firm or trust company doing business in the United
States or abroad which is qualified
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<PAGE>
under the Investment Company Act of 1940, as
amended, to act as a custodian and has been
designated by the Custodian as its agent for this
purpose) registered in the name of the Trust or in
the name of a nominee of the Custodian referred to in
Section 2.3 hereof or in proper form for transfer;
(b) in the case of a purchase effected through a
Securities System, in accordance with the conditions
set forth in Section 2.10 hereof or (c) in the case
of a purchase involving the Direct Paper System, in
accordance with the conditions set forth in Section
2.10A; or (d) in the case of repurchase agreements
entered into between the Trust and the Custodian, or
another bank, or a broker-dealer which is a member of
NASD, (i) against delivery of the securities either
in certificate form or through an entry crediting the
Custodian's account at the Federal Reserve Bank with
such securities or (ii) against delivery of the
receipt evidencing purchase by the Trust of
securities owned by the Custodian along with written
evidence of the agreement by the Custodian to
repurchase such securities from the Trust or (e) for
transfer to a time deposit account of the Trust in
any bank, whether domestic or foreign; such transfer
may be
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<PAGE>
effected prior to receipt of a confirmation
from a broker and/or the applicable bank
pursuant to Proper Instructions from the Trust as
defined in Section 2.15;" IV. Following Section 2.10
there is inserted a new Section 2.10.A to read as
follows:
2.10.A "Trust Assets Held in the Custodian's Direct Paper
System. The Custodian may deposit and/or maintain securities owned by the
Trust in the Direct Paper System of the Custodian subject to the following
provisions:
1) No transaction relating to securities in the
Direct Paper System will be effected in the
absence of Proper Instructions;
2) The Custodian may keep securities of the Trust
in the Direct Paper System only if such
securities are represented in an account
("Account") of the Custodian in the Direct
Paper System which shall not include any assets
of the Custodian other than assets held as a
fiduciary, custodian or otherwise for
customers;
3) The records of the Custodian with respect to
securities of the Trust which are
maintained in
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<PAGE>
the Direct Paper System shall identify by
book-entry those securities belonging to the
Trust;
4) The Custodian shall pay for
securities purchased for the account of the
Trust upon the making of an entry on the
records of the Custodian to reflect such
payment and transfer of securities to the
account of the Trust. The Custodian shall
transfer securities sold for the account of the
Trust upon the making of an entry on the
records of the Custodian to reflect such
transfer and receipt of payment for the account
of the Trust;
5) The Custodian shall furnish the Trust
confirmation of each transfer to or from
the account of the Trust, in the form of a
written advice or notice, of Direct Paper on
the next business day following such transfer
and shall furnish to the Trust copies of daily
transaction sheets reflecting each day's
transaction in the Securities System for the
account of the Trust;
6) The Custodian shall provide the Trust with
any report on its system of internal
accounting control as the Trust may reasonably
request from time to time."
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<PAGE>
V. Section 9 is hereby amended to read as
follows:
"Effective Period, Termination and Amendment
This Contract shall become effective as of its execution,
shall continue in full force and effect until terminated as hereinafter
provided, may be amended at any time by mutual agreement of the parties hereto
and may be terminated by either party by an instrument in writing delivered or
mailed, postage prepaid to the other party, such termination to take effect not
sooner than thirty (30) days after the date of such delivery or mailing;
provided, however that the Custodian shall not act under Section 2.10 hereof in
the absence of receipt of an initial certificate of the Secretary or an
Assistant Secretary that the Board of Trustees of the Trust has approved the
initial use of a particular Securities System and the receipt of an annual
certificate of the Secretary or an Assistant Secretary that the Board of
Trustees has reviewed the use by the Trust of such Securities System, as
required in each case by Rule 17f-4 under the Investment Company Act of 1940, as
amended and that the Custodian shall not act under Section 2.10A hereof in the
absence of receipt of an initial certificate of the Secretary or an Assistant
Secretary that the Board of Trustees has approved the initial use of the Direct
Paper System and the receipt of an annual certificate of the Secretary or an
Assistant Secretary that the Board of Trustees has reviewed the use by the Trust
of the Direct Paper System; provided further, however, that the Trust shall not
amend or terminate this
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<PAGE>
Contract in contravention of any applicable federal or state regulations, or any
provision of the Declaration of Trust, and further provided, that the Trust may
at any time by action of its Board of Trustees (i) substitute another bank or
trust company for the Custodian by giving notice as described above to the
Custodian, or (ii) immediately terminate this Contract in the event of the
appointment of a conservator or receiver for the Custodian by the Comptroller of
the Currency or upon the happening of a like event at the direction of an
appropriate regulatory agency or court of competent jurisdiction.
Upon termination of the Contract, the Trust shall pay to the Custodian
such compensation as may be due as of the date of such termination and shall
likewise reimburse the Custodian for its costs, expenses and disbursements."
Except as otherwise expressly amended and modified herein, the
provisions of the Custodian Contract shall remain in full force and effect.
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<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment to be executed in its name and on its behalf by its duly authorized
representatives and its Seal to be hereto affixed as of the 17th day of
September, 1991.
ATTEST: MFS MUNICIPAL INCOME TRUST
LINDA J. HOARD By: W. T. LONDON
Linda J. Hoard W. T. London
Assistant Secretary Treasurer
ATTEST: STATE STREET BANK AND TRUST COMPANY
JOE KINNALLY By: JOHN HENRICH
Joe Kinnally John Henrich
Assistant Secretary Vice President
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<PAGE>
EXHIBIT NO. 99(j)(4)
AMENDMENT TO
CUSTODIAN CONTRACT
Amendment to Custodian Contract between MFS Municipal Income Trust, a
business trust organized and existing under the laws of Massachusetts, having a
principal place of business at 200 Berkeley Street, Boston, Massachusetts 02116
(hereinafter called the "Fund"), and State Street Bank and Trust Company, a
Massachusetts trust company, having its principal place of business at 225
Franklin Street, Boston, Massachusetts 02110 (hereinafter called the
"Custodian").
WHEREAS: The Fund and the Custodian are parties to a
Custodian Contract dated February 19, l988 (the "Custodian Contract");
WHEREAS: The Fund desires that the Custodian issue a letter of credit
(the "Letter of Credit") on behalf of the Fund for the benefit of ICI Mutual
Insurance Company (the "Company") in accordance with the Continuing Letter of
Credit and Security Agreement and that the Fund's obligations to the Custodian
with respect to the Letter of Credit shall be fully collateralized at all times
while the Letter of Credit is outstanding by, among other things, segregated
assets of the Fund equal to 125% of the face amount to the amount of the Letter
of Credit;
WHEREAS: The Custodian Contract provides for the
establishment of segregated accounts for proper Fund purposes upon
Proper Instructions (as defined in the Custodian Contract); and
WHEREAS: The Fund and the Custodian desire to establish a
segregated account to hold the collateral for the Fund's obligations
to the Custodian with respect to the Letter of Credit and to amend
the Custodian Contract to provide for the establishment and
maintenance thereof;
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<PAGE>
WITNESSETH: That in consideration of the mutual covenants
and agreements hereinafter contained, the parties hereto hereby amend
the Custodian Contract as follows:
1. Capitalized terms used herein without definition shall have
the meanings ascribed to them in the Custodian Contract.
2. The Fund hereby instructs the Custodian to establish and
maintain a segregated account (the "Letter of Credit Custody
Account") for and in behalf of the Fund as contemplated by
Section 2.13(iv) for the purpose of collateralizing the Fund's
obligations under this Amendment to the Custodian Contract.
3. The Fund shall deposit with the Custodian and the Custodian shall
hold in the Letter of Credit Custody Account cash, U.S.
government securities and other high-grade debt securities owned
by the Fund acceptable to the Custodian (collectively "Collateral
Securities") equal to 125% of the face amount to the amount which
the Company may draw under the Letter of Credit. Upon receipt of
such Collateral Securities in the Letter of Credit Custody
Account, the Custodian shall issue the Letter of Credit to the
Company.
4. The fund hereby grants to the Custodian a security interest in
the Collateral Securities from time to time in the Letter of
Credit Custody Account (the "Collateral") to secure the
performance of the Fund's obligations to the Custodian with
respect to the Letter of Credit, including, without limitation,
under Section 5-114(3) of the Uniform Commercial Code. The Fund
shall register the pledge of Collateral and execute and deliver
to the Custodian such powers and instruments of assignment as may
be requested by the Custodian to evidence and perfect the limited
interest in the Collateral granted hereby.
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<PAGE>
5. The Collateral Securities in the Letter of Credit Custody
Account may be substituted or exchanged (including substitutions
or exchanges which increase or decrease the aggregate value of
the Collateral) only pursuant to Proper Instructions from the
Fund after the Fund notifies the Custodian of the contemplated
substitution or exchange and the Custodian agrees that such
substitution or exchange is acceptable to the Custodian.
6. Upon any payment made pursuant to the Letter of Credit by
the Custodian to the Company, after notice to the company, the
Custodian may withdraw from the Letter of Credit Custody Account
Collateral Securities in an amount equal in value to the amount
actually so paid. The Custodian shall have with respect to the
Collateral so withdrawn all of the rights of a secured creditor
under the Uniform Commercial Code as adopted in the Commonwealth
of Massachusetts at the time of such withdrawal and all other
rights granted or permitted to it under law.
7. The Custodian will transfer upon receipt all income earned on
the Collateral to the Fund custody account unless the Custodian
receives Proper Instructions from the Fund to the contrary.
8. Upon the drawing by the Company of all amounts which may become
payable to it under the Letter of Credit and the withdrawal of
all Collateral Securities with respect thereto by the Custodian
pursuant to Section 6 hereof, or upon the termination of the
Letter of Credit by the Fund with the written consent of the
Company, the Custodian shall transfer any Collateral Securities
then remaining in the Letter of Credit Custody Account to another
fund custody account.
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<PAGE>
9. Collateral held in the Letter of Credit Custody Account shall be
released only in accordance with the provisions of this Amendment
to Custodian Contract. The Collateral shall at all times until
withdrawn pursuant to Section 6 hereof remain the property of the
Fund, subject only to the extent of the interest granted herein
to the Custodian.
10. Notwithstanding any other termination of the Custodian Contract,
the Custodian Contract shall remain in full force and effect with
respect to the Letter of Credit Custody Account until transfer of
all Collateral Securities pursuant to Section 8 hereof.
11. The Custodian shall be entitled to reasonable compensation for
its issuance of the Letter of Credit and for its services in
connection with the Letter of Credit Custody Account as agreed
upon from time to time between the Fund and the Custodian.
12. The Custodian Contract as amended hereby, shall be governed by,
and construed and interpreted under, the laws of the Commonwealth
of Massachusetts.
13. The parties agree to execute and deliver all such further
documents and instruments and to take such further action as may
be required to carry out the purposes of the Custodian Contract,
as amended hereby.
14. Except as provided in this Amendment to Custody Contract, the
Custodian Contract shall remain in full force and effect, without
amendment or modification, and all applicable provisions of the
Custodian Contract, as amended hereby, including, without
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<PAGE>
limitation, Section 8 thereof, shall govern the Letter of Credit
Custody Account and the rights and obligations of the Fund and
the Custodian under this Amendment to Custodian Contract. No
provision of this Amendment to Custodian Contract shall be deemed
to constitute a waiver of any rights of the Custodian under the
Custodian Contract or under law.
IN WITNESS WHEREOF, each of the parties has caused this Amendment to
Custodian Contract to be executed in its name and behalf by its duly authorized
representatives and its seal to be hereunder affixed as of February 29, 1988.
ATTEST:
By: D. M. JAFFE By: W. T. LONDON
D. M. Jaffe W. T. London
Treasurer
ATTEST: STATE STREET BANK & TRUST COMPANY
By: K. M. KNEELAND By: ILLEGIBLE
K. M. Kneeland (illegible)
Assistant Secretary Vice President
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<PAGE>
EXHIBIT NO. 99(p)
MFS MUNICIPAL INCOME TRUST
MFS Municipal Income Trust
200 Berkeley Street
Boston, MA 02116
Gentlemen:
In connection with my purchase of ___________________________ Shares of
Beneficial Interest (without par value) of MFS Municipal Income Trust, I hereby
represent and warrant to you that I am purchasing said shares as an investment
with no intention of redeeming or reselling said shares until a date at least
two years hereafter.
Very truly yours,
