<PAGE>
As filed with the Securities and Exchange Commission on September 1, 1995
1933 Act File No. 33-68310
1940 Act File No. 811-7992
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM N-1A
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 3
AND
REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 4
MFS UNION STANDARD TRUST
(Exact Name of Registrant as Specified in Charter)
500 Boylston Street, Boston, Massachusetts 02116
(Address of Principal Executive Offices)
Registrant's Telephone Number, Including Area Code: 617-954-5000
Stephen E. Cavan, Massachusetts Financial Services Company,
500 Boylston Street, Boston, Massachusetts 02116
(Name and Address of Agent for Service)
APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING:
It is proposed that this filing will become effective (check appropriate box)
/ / immediately upon filing pursuant to paragraph (b)
/ / on [DATE] pursuant to paragraph (b)
/ / 60 days after filing pursuant to paragraph (a)(i)
/ / on [DATE] pursuant to paragraph (a)(i)
/X/ 75 days after filing pursuant to paragraph (a)(ii)
/ / on [DATE] pursuant to paragraph (a)(ii) of rule 485.
If appropriate, check the following box:
/ / this post-effective amendment designates a new effective date for a
previously filed post-effective amendment
STATEMENT PURSUANT TO RULE 24f-2
Pursuant to Rule 24f-2, the Registrant has registered an indefinite number of
its Shares of Beneficial Interest, without par value, under the Securities Act
of 1933 and filed a Rule 24f-2 Notice on behalf of MFS Union Standard Equity
Fund with respect to its fiscal year ended September 30, 1994 on November 29,
1994, and with respect to its fiscal year ending September 30, 1995 will file a
Rule 24f-2 Notice on behalf of MFS Union Standard Equity Fund on or before
November 30, 1995.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
MFS UNION STANDARD TRUST
MFS UNION STANDARD RESEARCH FUND
CROSS REFERENCE SHEET
(Pursuant to Rule 404 showing location in Prospectus and/or Statement of
Additional Information of the responses to the Items in Parts A and B of
Form N-1A)
STATEMENT OF
ITEM NUMBER ADDITIONAL
FORM N-1A, PART A PROSPECTUS CAPTION INFORMATION
----------------- ------------------ ------------
1 (a), (b) Front Cover Page *
2 (a) Expense Summary *
(b), (c) * *
3 (a), (b), (c), (d) * *
4 (a) The Trust and the Fund; Investment *
Objective and Policies; Investment
Techniques
(b), (c) Investment Objective and Policies; *
Investment Techniques
5 (a) The Trust and the Fund; Management *
of the Fund - Investment Adviser
(b) Front Cover Page; Management of *
the Fund - Investment Adviser; Back
Cover Page
(c) Management of the Fund - Investment *
Adviser
<PAGE>
STATEMENT OF
ITEM NUMBER ADDITIONAL
FORM N-1A, PART A PROSPECTUS CAPTION INFORMATION
----------------- ------------------ ------------
(d) * *
(e) Back Cover Page *
(f) Expense Summary *
(g) Investment Techniques - Portfolio *
Trading
5A (a), (b) ** **
6 (a) Information Concerning Shares of the *
Fund - Description of Shares, Voting
Rights and Liabilities; Information
Concerning Shares of the Fund -
Redemptions; Information Concerning
Shares of the Fund - Purchases;
Information Concerning Shares of the
Fund - Exchanges
(b), (c), (d) * *
(e) Shareholder Services *
(f) Information Concerning Shares of the *
Fund - Distributions; Shareholder
Services - Distribution Options
(g) Information Concerning Shares of the *
Fund - Tax Status; Information
Concerning Shares of the Fund -
Distributions
7 (a) Front Cover Page; Management of the *
Fund - Distributor; Back Cover Page
(b) Information Concerning Shares of the *
Fund - Purchases; Information
Concerning Shares of the Fund -
Net Asset Value
<PAGE>
STATEMENT OF
ITEM NUMBER ADDITIONAL
FORM N-1A, PART A PROSPECTUS CAPTION INFORMATION
----------------- ------------------ ------------
(c) Information Concerning Shares of the *
Fund - Exchanges
(d) Front Cover Page; Information *
Concerning Shares of the Fund -
Purchases
(e) Information Concerning Shares of the *
Fund - Distribution Plan; Expense
Summary
(f) Information Concerning Shares of the *
Fund - Distribution Plan
8 (a) Information Concerning Shares of the *
Fund - Redemptions; Information
Concerning Shares of the Fund -
Exchanges
(b), (c), (d) Information Concerning Shares of the *
Fund - Redemptions
9 * *
<PAGE>
STATEMENT OF
ITEM NUMBER ADDITIONAL
FORM N-1A, PART B PROSPECTUS CAPTION INFORMATION
----------------- ------------------ ------------
10 (a), (b) * Front Cover Page
11 * Front Cover Page
12 * General
Information and
Definitions
13 (a) * Additional
Investment
Techniques and
Risk Factors
(b), (c) * Additional
Investment
Techniques and
Risk Factors;
Investment
Restrictions
(d) * Additional
Investment
Techniques and
Risk Factors
14 (a), (b) * Management of
the Fund -
Trustees;
Management of
the Fund -
Officers
(c) * Appendix A
15 (a), (b) * *
(c) * Management of
the Fund -
Trustees;
Management of
the Fund -
Officers
16 (a) Management of the Fund - Management of
Investment Adviser the Fund -
Investment
Adviser;
Management of
the Fund -
Trustees;
Management of
the Fund -
Officers
(b) Management of the Fund - Management of
Investment Adviser the Fund -
Investment
Adviser
<PAGE>
STATEMENT OF
ITEM NUMBER ADDITIONAL
FORM N-1A, PART B PROSPECTUS CAPTION INFORMATION
----------------- ------------------ ------------
(c) * *
(d) * Management of
the Fund -
Investment
Adviser
(e) * Portfolio
Transactions
and Brokerage
Commissions
(f) Information Concerning Shares Distribution
of the Fund - Distribution Plan Plan
(g) * *
(h) * Management of
the Fund -
Custodian;
Independent
Accountants and
Financial
Statements;
Back Cover Page
(i) * Management of
the Fund -
Shareholder
Servicing Agent
17 (a) * Portfolio
Transactions
and Brokerage
Commissions
(b) * *
(c) * Portfolio
Transactions
and Brokerage
Commissions
(d), (e) * *
18 (a) Information Concerning Shares of Description of
the Fund - Decription of Shares, Shares, Voting
Voting Rights and Liablitiies Rights and
Liabilities
(b) * *
<PAGE>
STATEMENT OF
ITEM NUMBER ADDITIONAL
FORM N-1A, PART B PROSPECTUS CAPTION INFORMATION
----------------- ------------------ ------------
19 (a) Information Concerning Shares of *
the Fund - Purchases
(b) Information Concerning Shares of Determination of
the Fund - Net Asset Value; Net Asset
Information Concerning Shares Value;
of the Fund - Purchases Performance
Information -
Net Asset
Value
(c) * *
20 * Tax Status
21 (a), (b) * Management of
the Fund -
Distributor;
Distribution
Plan
(c) * *
22 (a) * *
(b) * Determination of
Net Asset
Value;
Performance
Information
23 * Independent
Accountants
and Financial
Statements
-----------------------------
* Not Applicable
** Contained in Annual Report (for the MFS Union Standard Equity Fund)
<PAGE>
MFS-REGISTERED TRADEMARK- PROSPECTUS
UNION November 16, 1995
STANDARD-SM- RESEARCH FUND Shares of Beneficial Interest
--------------------------------------------------------------------------------
MFS UNION STANDARD-SM- TRUST
500 Boylston Street, Boston, Massachusetts 02116 (617) 954-5000
MFS Union Standard Research Fund (the "Research Fund" or the "Fund") is a series
of MFS Union Standard-SM- Trust (the "Trust"), a professionally managed no-load,
open-end, investment management company. The Trust is designed to permit pension
plans to invest in companies which meet certain labor sensitivity criteria
selected for inclusion in the ACS Labor Sensitivity Index-SM- (the "LSI-SM-").
The LSI is a common stock index comprised of companies selected based on labor
sensitivity criteria.
The Research Fund seeks long-term growth of capital that, net of Fund expenses,
exceeds the performance of the LSI by investing at least 65% of its assets in
the equity securities of the 100 largest companies by market capitalization
included in the LSI. The relative weighting of a company in the Fund's portfolio
will be determined by reference to its relative market capitalization and its
investment merits.
The minimum initial investment generally is $3 million per account (see
"Purchases"). The Fund's investment adviser and distributor are Massachusetts
Financial Services Company ("MFS" or the "Adviser") and MFS Fund Distributors,
Inc. ("MFD"), respectively, both of which are located at 500 Boylston Street,
Boston, Massachusetts 02116.
This Prospectus sets forth concisely the information concerning the Trust and
the Fund that a prospective investor ought to know before investing. The Trust,
on behalf of the Fund, has filed with the Securities and Exchange Commission
(the "SEC") a Statement of Additional Information, dated November 16, 1995,
which contains more detailed information about the Trust and the Fund and is
incorporated into this Prospectus by reference. See page 14 for a further
description of the information set forth in the Statement of Additional
Information. A copy of the Statement of Additional Information may be obtained
without charge by contacting the Shareholder Servicing Agent (see back cover for
address and phone number).
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
INVESTORS SHOULD READ THIS PROSPECTUS AND RETAIN IT FOR FUTURE REFERENCE.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<C> <S> <C>
1. Expense Summary..................................................... 3
2. The Trust and the Fund.............................................. 4
3. Labor Sensitivity Index............................................. 4
4. Investment Objective and Policies................................... 5
5. Investment Techniques............................................... 6
6. Management of the Fund.............................................. 7
7. Information Concerning Shares of the Fund........................... 8
Purchases....................................................... 8
Exchanges....................................................... 9
Redemptions..................................................... 9
Distribution Plan............................................... 11
Distributions................................................... 11
Tax Status...................................................... 11
Net Asset Value................................................. 12
Description of Shares, Voting Rights and Liabilities............ 12
Performance Information......................................... 12
Expenses........................................................ 13
8. Shareholder Services................................................ 13
</TABLE>
2
<PAGE>
1. EXPENSE SUMMARY
<TABLE>
<CAPTION>
RESEARCH
FUND
---------
<S> <C>
SHAREHOLDER TRANSACTION EXPENSES:
Maximum Sales Load Imposed on Purchases................. NONE
Maximum Sales Load Imposed on Reinvested Dividends...... NONE
Deferred Sales Load..................................... NONE
Redemption Fee.......................................... NONE
Exchange Fee............................................ NONE
ANNUAL OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET
ASSETS):
Management Fees......................................... 0.60 %
Rule 12b-1 Fees(1)...................................... 0.15 %
Other Expenses (after applicable fee reduction)(2)...... 0.25 %
Total Operating Expenses (after applicable fee
reduction)(2).......................................... 1.00 %
<FN>
------------------------
(1) The Fund has adopted a Distribution Plan in accordance with Rule 12b-1
under the Investment Company Act of 1940, as amended (the "1940 Act"),
which provides that it will pay distribution fees aggregating up to (but
not necessarily all of) 0.25% per annum of its average daily net assets.
This fee is set at 0.15% per annum of the average daily net assets of the
Fund for the current fiscal year.
(2) The Adviser has agreed to bear, until December 31, 1998, subject to
reimbursement as described under "Information Concerning Shares of the Fund
-- Expenses," the Fund's expenses such that "Total Operating Expenses" do
not exceed 1.00% per annum of the average daily net assets of the Fund
during the current fiscal year and each fiscal year thereafter through
December 31, 1998. Otherwise, "Other Expenses" and "Total Operating
Expenses" for the Fund for the current fiscal year would be 0.84% and 1.64%
per annum, respectively. See "Information Concerning Shares of the Fund --
Expenses."
</TABLE>
EXAMPLE OF EXPENSES
An investor would pay the following dollar amounts of expenses on a $1,000
investment in the Fund, assuming (a) 5% annual return and (b) redemption at the
end of each of the time periods indicated (unless otherwise noted):
<TABLE>
<CAPTION>
RESEARCH
PERIOD FUND
---------------------------------------------------------------------- --------
<S> <C>
1 year................................................................ $ 10
3 years............................................................... 32
</TABLE>
The purpose of the expense table above is to assist investors in understanding
the various costs and expenses that a shareholder of the Fund will bear directly
or indirectly. The 5% annual return used in the example is only for
illustration. More complete descriptions of the following Fund expenses are set
forth in the following sections: (i) management fees -- "Management of the Fund
-- Investment Adviser" and (ii) Rule 12b-1 (I.E., distribution plan) fees --
"Distribution Plan."
THE "EXAMPLE" SET FORTH ABOVE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST
OR FUTURE EXPENSES OF THE FUND; ACTUAL EXPENSES MAY BE GREATER OR LESS THAN
THOSE SHOWN.
3
<PAGE>
2. THE TRUST AND THE FUND
The Trust is a no-load, open-end, investment management company designed to
permit pension plans to invest in companies which meet certain labor sensitivity
criteria selected for inclusion in the LSI. The Trust was organized as a
business trust under the laws of The Commonwealth of Massachusetts on September
1, 1993. The Trust currently consists of two diversified series or funds, the
Research Fund and the MFS Union Standard Equity Fund (the "Equity Fund"), each
of which represents a portfolio with separate investment objectives and
policies. The Equity Fund is offered pursuant to a separate prospectus which may
be obtained without charge by contacting the Shareholder Servicing Agent (see
back cover for address and phone number).
Shares of the Fund are continuously sold to the public and the Fund then uses
the proceeds to buy securities for its portfolio. One hundred percent of the
amount invested in the Fund is used to purchase shares without the deduction of
any sales charge. The Fund offers to buy back (redeem) its shares from its
shareholders at any time at net asset value without the deduction of any
redemption fee or sales charge. See "Purchases" and "Redemptions."
The Trust's Board of Trustees provides broad supervision over the affairs of the
Fund. MFS is the Fund's investment adviser and is responsible for the management
of the Fund's assets, while the officers of the Trust are responsible for the
Fund's operations. MFS manages the Fund's portfolio from day to day in
accordance with its investment objective and policies. A majority of the Trust's
Trustees are not affiliated with MFS. American Capital Strategies Ltd. ("ACS")
administers the LSI for MFS but has no responsibility for rendering investment
advice to MFS or to the Fund.
3. LABOR SENSITIVITY INDEX
The LSI is a common stock index developed and maintained by ACS for use by the
Trust and represents the market-weighted performance of common stocks of
companies which ACS and the Labor Advisory Board (as described below) determine
meet certain labor sensitivity criteria. The "Labor Sensitivity Index-SM-" and
the "LSI-SM-" are service marks of ACS. The LSI was established on the date the
Equity Fund commenced investment operations (January 14, 1994) and, as of the
date of this Prospectus, is comprised of common stocks of approximately 545
companies which meet certain quantitative and qualitative labor sensitivity
criteria. The criteria used in developing and maintaining the LSI involve the
initial use of quantitative guidelines and the subsequent use of qualitative
guidelines applied by ACS with the guidance of the Labor Advisory Board (the
"Advisory Board"), which is comprised of senior labor officials, senior managers
of companies with significant labor contracts, academics and other national
labor leaders or experts and has been established by ACS. The Advisory Board
provides guidance to ACS in the development, refinement, and application of
qualitative and quantitative labor sensitivity criteria for the development and
maintenance of the LSI. MFS is not affiliated with ACS or the Advisory Board.
In selecting companies for inclusion in the LSI, ACS first compiles a list of
companies with labor agreements. The sources for this list include the research
departments of various international unions, publicly available documents, and
government reports. ACS then applies quantitative guidelines which, as of the
date of this Prospectus, measure the degree to which a company's workforce is
unionized. At its discretion, ACS may vary from time to time the labor
sensitivity factors it considers or change the emphasis it places on any
specific factor.
After ACS has applied the quantitative guidelines, the list is then reviewed by
the Advisory Board, which assists in the application of qualitative guidelines
which take into account a number of labor sensitivity criteria. The qualitative
factors considered include, as of the date of this Prospectus, whether the
company is manufacturing or has manufactured products on the boycott list of the
AFL-CIO or certain other unions, whether the company is or has been involved in
strikes or lock-outs, and whether the company has demonstrated patterns of
non-compliance with applicable labor or health and safety laws. The Advisory
Board also considers patterns of outsourcing and associated plant closings,
patterns of strikes or lockouts, the degree to which a company's labor relations
vary throughout different divisions, subsidiaries, or parts of their company and
4
<PAGE>
the extent of foreign ownership of a company with a unionized workforce, and
will vary from time to time. This list and any subsequent updates are supplied
to MFS by ACS. The LSI is updated at least quarterly by ACS. See "Management of
the Fund -- Index Manager" and "-- Advisory Board" below.
Like the Standard & Poor's 500 Index (the "S&P 500"), the LSI is a market
capitalization weighted index and reflects the reinvestment of dividends paid on
the common stocks that comprise the LSI. However, unlike certain other stock
indices, such as the S&P 500, the LSI is not a recognized yardstick or
measurement of investment performance. Because of the criteria applied in the
selection of companies to be included in the LSI, the LSI may exclude entirely
or under- or over-weight particular industry sectors relative to other stock
indices such as the S&P 500. The performance of the LSI (or the 100 largest
companies by market capitalization contained in the LSI) may not correlate with
the performance of such other indices, such as the S&P 500, for certain periods.
As of the date of this Prospectus, approximately 80% of the 100 largest
companies by market capitalization contained in the LSI were also represented
among the companies comprising the S&P 500.
On January 14, 1994, the date that the Equity Fund commenced investment
operations, the unit value of the LSI was established at 100. The unit value of
the LSI will be determined once monthly as of the last day of each month. As the
investment objective of the Research Fund is to provide long-term growth of
capital that, net of Fund expenses, exceeds the performance of the LSI, from
time to time the Research Fund will compare its total return for a given time
period to the performance of the LSI for the same time period. See "Investment
Objective and Policies" and "Information Concerning Shares of the Fund --
Performance Information" below. The performance of the LSI shall be measured by
comparing the unit value of the LSI at the end of the time period to the unit
value of the LSI at the beginning of the time period.
The selection of a company for investment by the Fund does not constitute an
endorsement or validation by the Fund or MFS of the criteria applied by ACS and
the Advisory Board in the development or maintenance of the LSI. ACS does not
determine the investment policies of the Fund or decide which securities of
companies included in the LSI the Fund will buy and sell.
Pursuant to a Proxy Services Agreement between ACS and the Trust, acting on
behalf of the Fund, ACS shall vote all proxies of companies included in the
Fund's portfolio consistent with proxy voting guidelines established by the
AFL-CIO, unless the Board of Trustees of the Trust directs otherwise. These
guidelines obligate ACS to make voting decisions consistent with the economic
best interests of shareholders of the Fund, and set forth considerations to be
taken into account by ACS with respect to certain types of proxy proposals.
4. INVESTMENT OBJECTIVE AND POLICIES
INVESTMENT OBJECTIVE -- The investment objective of the Research Fund is to
provide long-term growth of capital that, net of Fund expenses, exceeds the
performance of the LSI. Dividend and interest income from portfolio securities,
if any, is incidental to the Fund's investment objective of long-term growth of
capital. Any investment involves risk and there can be no assurance that the
Fund will achieve its investment objective.
INVESTMENT POLICIES -- The Fund seeks to achieve its investment objective by
investing, under normal market conditions, at least 65% of its assets in equity
securities of the 100 largest companies by market capitalization contained in
the LSI (referred to as the "100 Largest LSI Companies" or the "Companies"). As
of the date of this Prospectus, the 100 Largest LSI Companies represented
approximately 80 percent of the total market capitalization of the LSI. Each of
the 100 Largest LSI Companies receives a rating by the investment research
analysts in the Equity Research Department of the Adviser based upon qualitative
and quantitative considerations. A Company will be rated number 1 by the Adviser
if the Adviser expects it to outperform the S&P 500 over the succeeding twelve
months and will have a portfolio weighting, at the time of purchase, equal to
approximately 120 percent of its relative market capitalization among the 100
Largest LSI Companies; a Company will be rated number 2 by the Adviser if the
Adviser expects it to approximate the performance of the S&P 500 over the
succeeding twelve months and will have a portfolio weighting, at the time of
purchase, approximately equal to its relative weighting among
5
<PAGE>
the 100 Largest LSI Companies; and a Company will be rated number 3 by the
Adviser if the Adviser expects it to underperform the S&P 500 over the
succeeding twelve months and will have a portfolio weighting, at the time of
purchase, equal to approximately 80 percent of its relative weighting among the
100 Largest LSI Companies.
While the Fund may invest up to 35% of its total assets in equity securities of
companies which are not included within the 100 Largest LSI Companies, including
companies comprising the LSI other than the 100 Largest LSI Companies, the Fund
expects to be fully invested in equity securities of the 100 Largest LSI
Companies, except for cash and cash equivalent investments and the investments
and investment techniques described below. While portfolio weightings of the
securities of the Companies purchased by the Fund are determined at the time of
purchase, the Fund will periodically readjust its holdings to maintain such
portfolio weightings. Such adjustments may be appropriate due to a change in a
ranking assigned to a Company by the Adviser, changes in the relative
capitalization of the 100 Largest LSI Companies, cash inflows to the Fund (E.G.,
purchases) and cash outflows from the Fund (E.G., redemptions).
5. INVESTMENT TECHNIQUES
SHORT-TERM INVESTMENTS: The Fund may invest in cash or cash equivalents
including, but not limited to, obligations of banks (including certificates of
deposit, bankers' acceptances and repurchase agreements) with assets of $1
billion or more, commercial paper, short-term notes, U.S. Government securities
and related repurchase agreements. U.S. Government securities also include
interests in trusts or other entities representing interests in obligations that
are issued or guaranteed by the U.S. Government, its agencies, authorities or
instrumentalities. During periods of unusual market conditons when MFS believes
that investing for defensive purposes is appropriate, or in order to meet
anticipated redemption requests, a large portion or all of the assets of the
Fund may be invested in cash or cash equivalents.
LENDING OF SECURITIES: The Fund may make loans of its portfolio securities. Such
loans will usually be made only to member banks of the Federal Reserve System
and member firms (and subsidiaries thereof) of the New York Stock Exchange (the
"Exchange") and would be required to be secured continuously by collateral in
cash, cash equivalents or U.S. Government securities maintained on a current
basis at an amount at least equal to the market value of the securities loaned.
The Fund would continue to collect the equivalent of the interest on the
securities loaned and would also receive either interest (through investment of
cash collateral) or a fee (if the collateral is U.S. Government securities). The
value of securities loaned will not exceed 30% of the value of the Fund's total
assets.
REPURCHASE AGREEMENTS: The Fund may enter into repurchase agreements in order to
earn additional income on available cash or as a temporary defensive measure.
Under a repurchase agreement, the Fund acquires securities subject to the
seller's agreement to repurchase at a specified time and price. If the seller
becomes subject to a proceeding under the bankruptcy laws or its assets are
otherwise subject to a stay order, the Fund's right to liquidate the securities
may be restricted (during which time the value of the securities could decline).
As discussed in the Statement of Additional Information, the Fund has adopted
certain procedures which are intended to minimize any such risk. See "Investment
Restrictions" in the Statement of Additional Information.
WHEN-ISSUED SECURITIES: In order to help ensure the availability of suitable
securities for its portfolio, the Fund may purchase securities on a
"when-issued" or on a "forward delivery" basis, which means that the obligations
will be delivered to the Fund at a future date usually beyond customary
settlement time. It is expected that, under normal circumstances, the Fund will
take delivery of such securities. In general, the Fund does not pay for the
securities until received and does not start earning interest on the obligations
until the contractual settlement date. While awaiting delivery of the
obligations purchased on such basis, the Fund will establish a segregated
account consisting of cash, short-term money market instruments or high quality
debt securities equal to the amount of the commitments to purchase "when-issued"
securities. See the Statement of Additional Information for further information.
6
<PAGE>
PORTFOLIO TRADING
The Fund intends to manage its portfolio by buying and selling securities in
accordance with its investment objective and policies. The Fund will engage in
portfolio trading if it believes a transaction, net of costs (including
custodian charges), will help in attaining its investment objective. In trading
portfolio securities, the Fund seeks to take advantage of market developments
and variations in the creditworthiness of issuers. For a description of the
strategies which may be used by the Fund in trading portfolio securities, see
"Portfolio Transactions and Brokerage Commissions" in the Statement of
Additional Information.
The primary consideration in placing portfolio security transactions with
broker-dealers for execution is to obtain, and maintain the availability of,
execution at the most favorable prices and in the most effective manner
possible. Consistent with the foregoing primary consideration, the Rules of Fair
Practice of the National Association of Securities Dealers, Inc. (the "NASD")
and such other policies as the Trustees may determine, MFS may consider sales of
shares of investment company clients of MFD, which is also the distributor of
the shares of the MFS Family of Funds, as a factor in the selection of broker-
dealers to execute the Fund's portfolio transactions. For a further discussion
of portfolio trading, see the Statement of Additional Information.
-------------------
The Statement of Additional Information includes a discussion of other
investment policies and techniques and a listing of specific investment
restrictions which govern the Fund's investment policies. The specific
investment restrictions listed in the Statement of Additional Information may be
changed without shareholder approval, unless noted otherwise (see "Investment
Restrictions" in the Statement of Additional Information). The Fund's investment
limitations, policies and rating standards are adhered to at the time of
purchase or utilization of assets; a subsequent change in circumstances will not
be considered to result in a violation of policy.
6. MANAGEMENT OF THE FUND
INVESTMENT ADVISER -- MFS manages the Fund pursuant to an Investment Advisory
Agreement dated November 16, 1995 (the "Advisory Agreement") with the Trust on
behalf of the Fund. MFS provides the Fund with overall investment advisory and
administrative services, as well as general office facilities. The Fund is
currently managed by a committee comprised of various equity research analysts
employed by MFS. Subject to such policies as the Trustees may determine, MFS
makes investment decisions for the Fund. For its services and facilities, MFS
receives a management fee, computed and paid monthly, in an amount equal to
0.60% per annum of the average daily net assets of the Fund.
MFS also serves as investment adviser to each of the other funds in the MFS
Family of Funds (the "MFS Funds") and to 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, MFS
Institutional Trust, MFS Variable Insurance Trust, MFS/Sun Life Series Trust,
Sun Growth Variable Annuity Fund, Inc. and seven variable accounts, each of
which is a registered investment company established by Sun Life Assurance
Company of Canada (U.S.) ("Sun Life of Canada (U.S.)") in connection with the
sale of various fixed/variable annuity contracts. MFS and its wholly owned
subsidiary, MFS Asset Management, Inc., provide investment advice to substantial
private clients.
MFS is America's oldest mutual fund organization. MFS and its predecessor
organizations have a history of money management dating from 1924 and the
founding of the first mutual fund in the United States, Massachusetts Investors
Trust. Net assets under the management of the MFS organization were
approximately $38.4 billion on behalf of approximately 1.7 million investor
accounts as of July 31, 1995. As of such date, the MFS organization managed
approximately
7
<PAGE>
$14.8 billion of assets invested in equity securities and approximately $19.2
billion of assets invested in fixed income securities. Approximately $3.1
billion of the assets managed by MFS are invested in securities of foreign
issuers and non-U.S. dollar denominated securities of U.S. issuers. MFS is a
wholly owned subsidiary of Sun Life of Canada (U.S.), which in turn is a wholly
owned subsidiary of Sun Life Assurance Company of Canada ("Sun Life"). The
Directors of MFS are A. Keith Brodkin, Jeffrey L. Shames, Arnold D. Scott, John
D. McNeil and John R. Gardner. Mr. Brodkin is the Chairman, Mr. Shames is the
President and Mr. Scott is the Secretary and a Senior Executive Vice President
of MFS. Messrs. McNeil and Gardner are the Chairman and President, respectively,
of Sun Life. Sun Life, a mutual life insurance company, is one of the largest
international life insurance companies and has been operating in the United
States since 1895, establishing a headquarters office here in 1973. The
executive officers of MFS report to the Chairman of Sun Life.
A. Keith Brodkin, the Chairman and a Director of MFS, is the Chairman and
President and a Trustee of the Trust. W. Thomas London, Stephen E. Cavan, James
R. Bordewick, Jr. and James O. Yost, all of whom are officers of MFS, are
officers of the Trust.
DISTRIBUTOR -- MFD, a wholly owned subsidiary of MFS, is the distributor of
shares of the Fund.
SHAREHOLDER SERVICING AGENT -- MFS Service Center, Inc. (the "Shareholder
Servicing Agent"), a wholly owned subsidiary of MFS, performs transfer agency,
certain dividend disbursing agency and other services for the Fund.
INDEX MANAGER -- ACS, a Maryland corporation with offices at 3 Bethesda Metro
Center, Bethesda, Maryland 20814, develops, maintains and furnishes to MFS the
LSI pursuant to an agreement between MFS and ACS. Under this agreement, MFS pays
ACS a fee equal to 0.05% per annum, payable quarterly, of the aggregate average
daily net assets of the Fund and the Equity Fund, with a minimum quarterly fee
of $82,500.
ADVISORY BOARD -- The Advisory Board, established by ACS, assists in the
development and maintenance of the LSI by applying qualitative labor sensitivity
criteria and assisting ACS in developing and refining quantitative labor
sensitivity criteria applied by ACS. The Advisory Board is comprised of senior
labor officials, senior managers of companies with significant labor contracts,
academics and other national labor leaders or experts.
7. INFORMATION CONCERNING SHARES OF THE FUND
PURCHASES
Shares of the Fund may be purchased directly through MFD in cash or in-kind
without a sales charge at their net asset value next determined after acceptance
of the purchase order by the Fund's Shareholder Servicing Agent in Boston. The
minimum initial investment generally is $3 million. There is no minimum on
additional investments.
An order for the purchase of shares of the Fund is accepted upon receipt of
federal funds available for investment. Payment by federal funds sent by wire is
accepted immediately upon receipt and payment by check is accepted when federal
funds become available for investment, which generally occurs on the next
business day after receipt of a check. Therefore, a non-federal funds investment
will generally remain idle for one business day after receipt or until federal
funds otherwise become available for investment. All investments in the Fund are
credited to the shareholder's account in the form of full and fractional shares
at the net asset value per share next determined after acceptance of the
purchase order. The Fund does not issue share certificates, but the Shareholder
Servicing Agent maintains an account for each shareholder and mails to each
shareholder a confirmation of each purchase or sale of shares in its account.
Purchases and exchanges should be made for investment purposes only. A pattern
of frequent exchanges may be deemed by MFS to be abusive and contrary to the
best interests of the Fund's other shareholders and, at the discretion of MFS,
may be limited by the Fund's refusal to accept additional purchases and/or
exchanges from the investor. Although the Fund does not have any specific
definition of what constitutes a pattern of frequent purchases or exchanges, and
will consider all relevant factors in determining whether a particular situation
is abusive and contrary to the best interests of the Fund and its other
8
<PAGE>
shareholders, investors should be aware that the Fund may in its discretion
limit or otherwise restrict the number of times purchases or exchanges may be
made by an investor. Any such restriction will be made by the Fund on a
prospective basis only, upon notice to the shareholder.
OPENING AN ACCOUNT: Payments by check should be made to the order of "MFS Union
Standard Trust-Research Fund" and sent to the Trust as follows: MFS Service
Center, Inc., P.O. Box 1400, Boston, MA 02104-9985. Payments of federal funds
should be sent by wire to the custodian of the Fund as follows:
State Street Bank and Trust Company, Boston, MA 02101
ABA # 011000028
BNF = MFS Union Standard Trust-Research Fund
Account # 99034795
OBI = (Your account as it will be registered)
Information on how to wire federal funds is available at any national bank or
any state bank which is a member of the Federal Reserve System. Shareholders
must also mail the enclosed Account Application to the Shareholder Servicing
Agent.
A shareholder purchasing shares by wire must first telephone the Shareholder
Servicing Agent toll-free at (800) 637-8730 to advise of its intended action and
to obtain a wire order number.
IN-KIND PURCHASES OF SECURITIES: Shares of the Fund may be purchased by
exchanging securities acceptable to the Fund for Fund shares. The Fund need not
accept any security offered for exchange unless it is consistent with the Fund's
investment objective, policies and restrictions, and is otherwise acceptable to
the Fund. Securities accepted in exchange for shares will be valued in
accordance with the Fund's usual valuation procedures. Investors interested in
making an in-kind purchase of Fund shares must first telephone the Shareholder
Servicing Agent toll-free at (800) 637-8730 to advise of its intended action and
obtain instructions for an in-kind purchase.
EXCHANGES
Subject to the requirements set forth below, some or all of the shares in an
account with the Fund for which payment has been received by the Fund (I.E., an
established account) may be exchanged for shares of the Equity Fund (if
available for sale) at net asset value. Exchanges will be made only after
instructions in writing or by telephone (an "Exchange Request") are received for
an established account by the Shareholder Servicing Agent in proper form (see
"Redemptions" below). If an Exchange Request is being used to open a new
account, the exchange must involve shares having an aggregate value of at least
$3 million. If the Exchange Request is received by the Shareholder Servicing
Agent on any business day prior to the close of regular trading on the Exchange,
the exchange usually will occur on that day if all the requirements set forth
above have been complied with at that time. For federal and (generally) state
income tax purposes, an exchange is treated as a sale of the shares exchanged
and, therefore, an exchange could result in a gain or loss to non-tax-exempt
shareholders making the exchange. The exchange privilege (or any aspect of it)
may be changed or discontinued upon sixty days prior written notice to
shareholders and is subject to certain limitations, including certain
restrictions on purchases by market timer accounts described above
(see"Purchases").
REDEMPTIONS
A shareholder may withdraw all or any portion of the amount in its account on
any date on which the Fund is open for business by redeeming shares at their net
asset value. Since the net asset value of shares of the account fluctuates,
redemptions which are taxable transactions for non-tax exempt shareholders, are
likely to result in gains or losses to such shareholders. When a shareholder
withdraws an amount from its account, the shareholder is deemed to have tendered
for redemption a sufficient number of full and fractional shares in his account
to cover the amount withdrawn. The proceeds of a redemption will normally be
available within seven days, except that for shares purchased, or received in
exchange for shares purchased, by check (including certified checks or cashier's
checks) payment of redemption proceeds may be delayed for 15 days from the
9
<PAGE>
purchase date in an effort to assure that such check has cleared. Payment of
redemption proceeds may be delayed for up to seven days from the redemption date
if the Fund determines that such a delay would be in the best interest of all
its shareholders.
A. REDEMPTION BY MAIL -- Each shareholder may redeem all or any portion of the
shares in its account by mailing or delivering to the Shareholder Servicing
Agent (see back cover for address) a stock power with a written request for
redemption or a letter of instruction all in "good order" for transfer. Because
the shareholders of the Fund are pension plans, "good order" means that the
stock power, written request for redemption or letter of instruction must be
endorsed by a trustee or an authorized officer of the pension plan or an
authorized officer of the pension plan's custodian and the signature(s) must be
guaranteed in the manner set forth below under the caption "Signature Guarantee"
(unless the conditions set forth thereunder are satisfied). In addition, in some
cases "good order" requires that the pension plan or its custodian furnish
evidence of authority that the individual signing on the plan's behalf has
authority to so act. The Shareholder Servicing Agent may make certain DE MINIMIS
exceptions to the above requirements for redemption (see "Signature Guarantee"
below). Within seven days after receipt of a redemption request by the
Shareholder Servicing Agent in "good order," the Fund will normally make payment
in cash of the net asset value of the shares next determined after such
redemption request was received, less the amount of any income tax required to
be withheld, except during any period in which the right of redemption is
suspended or date of payment is postponed because the Exchange is closed or
trading on such Exchange is restricted or to the extent otherwise permitted by
the 1940 Act, if an emergency exists.
B. REDEMPTION BY TELEPHONE -- Each shareholder may redeem an amount from its
account by telephoning the Shareholder Servicing Agent toll-free at (800)
637-8730. Shareholders wishing to avail themselves of this telephone redemption
privilege must so elect on their Account Application, designate thereon a
commercial bank and account number to receive the proceeds of such redemption,
sign the Account Application Form with the signature(s) guaranteed in the manner
set forth below under the caption "Signature Guarantee" and furnish evidence of
authority that the individual signing on the pension plan's behalf has authority
to so act. The proceeds of such a redemption, less the amount of any income tax
required to be withheld, are wired in federal funds to the designated account.
If a telephone redemption request is received by the Shareholder Servicing Agent
by the close of regular trading on the Exchange on any business day, shares will
be redeemed at the closing net asset value of the Fund on that day. Subject to
the conditions described in this section, proceeds of a redemption are normally
wired on the next business day following the date of receipt of the order for
redemption. The Shareholder Servicing Agent will not be responsible for any
losses resulting from unauthorized telephone transactions if it follows
reasonable procedures designed to verify the identity of the caller. The
Shareholder Servicing Agent will request personal or other information from the
caller, and will normally also record calls. Shareholders should verify the
accuracy of confirmation statements immediately after their receipt.
SIGNATURE GUARANTEE: In order to protect shareholders against fraud to the
greatest extent possible, the Fund requires in certain instances as indicated
above that the shareholder's signature be guaranteed. In these cases the
shareholder's signature must be guaranteed by an eligible bank, broker, dealer,
credit union, national securities exchange, registered securities association,
clearing agency or savings association. Signature guarantees shall be accepted
in accordance with policies established by the Shareholder Servicing Agent. With
respect to written requests for redemptions, no signature guarantee or evidence
that the individual executing the stock power, written request for redemption or
letter of instruction will be required if the amount of the redemption proceeds
does not exceed specified minimums established from time to time by MFD and the
proceeds are wired or mailed to a predesignated account or address.
If MFS determines, in its sole discretion, that it would be detrimental to the
best interests of the remaining shareholders of the Fund or if requested by a
shareholder, the Fund may make payment of the redemption price, either totally
or partially, by a distribution in-kind of securities (instead of cash) from the
Fund's portfolio. The securities distributed in such a distribution would be
valued at the same amount as that assigned to them in calculating the net asset
value for the shares being sold (see
10
<PAGE>
"Net Asset Value" below). Securities distributed by the Fund will be selected by
MFS in light of the Fund's objective and will not generally represent a pro rata
distribution of each security held in the Fund's portfolio. If a shareholder
received a distribution in-kind, it would incur brokerage charges when
converting the securities to cash.
DISTRIBUTION PLAN
The Trustees have adopted a distribution plan (the "Distribution Plan" or the
"Plan") for the Fund pursuant to Section 12(b) of the 1940 Act and Rule 12b-1
thereunder (the "Rule"), after having concluded that there is a reasonable
likelihood that a plan would benefit the Fund and its shareholders.
The Distribution Plan provides that the Fund will pay MFD a distribution fee up
to (but not necessarily all of) 0.25% per annum of the Fund's average daily net
assets in order that MFD may pay expenses on behalf of the Fund related to the
distribution of shares. Payments under the Distribution Plan have been set for
an indefinite period of time at 0.15% per annum of the Fund's average daily net
assets. As contemplated by the Plan, MFD as the Fund's distributor, acts as an
agent of the Fund in connection with the offering of shares pursuant to the
Distribution Agreement with the Trust on behalf of the Fund. MFD receives such
fee as partial consideration for services performed and expenses incurred in the
performance of MFD's obligations under the Distribution Agreement.
The types of expenses for which MFD may be compensated under the Plan include
compensation to and expenses of employees of MFD who engage in or support the
distribution of shares or who service shareholder accounts, preparation,
printing and mailing of prospectuses and statements of additional information to
other than existing shareholders, reports to shareholders such as semiannual and
annual reports, performance reports and newsletters, sales literature and other
promotional material to prospective investors, direct mail solicitation,
advertising and public relations, compensation of sales personnel, office
expenses (including rent and overhead), equipment, travel and telephone expenses
and such other expenses as may be approved from time to time by the Trustees and
as may be permitted by applicable statute, rule or regulation. If the
distribution fee received by MFD exceeds its expenses, MFD may realize a profit
from these arrangements. Expenses under the Plan will be reviewed quarterly and
the Plan will be reviewed and is subject to approval annually by the Trustees.
DISTRIBUTIONS
The Fund intends to pay substantially all of its net investment income to its
shareholders as dividends on an annual basis. In determining the net investment
income available for distributions, the Fund may rely on projections of its
anticipated net investment income over a longer term, rather than its actual net
investment income for the period. The Fund may make one or more distributions
during the calendar year to its shareholders from any net realized long-term or
short-term capital gains. Shareholders may elect to receive dividends and
capital gain distributions in either cash or additional shares of the Fund. See
"Tax Status" and "Shareholder Services -- Distribution Options" below.
TAX STATUS
In order to minimize the taxes the Fund would otherwise be required to pay, the
Fund intends to elect to be, and to qualify each year as, a "regulated
investment company" under Subchapter M of the Internal Revenue Code of 1986, as
amended (the "Code"), and to make distributions to its shareholders in
accordance with the timing requirements set out in the Code. As a result, it is
expected that the Fund will not be required to pay any entity level federal
income or excise taxes.
The Fund's shareholders that are not liable for federal, state or local income
taxes, such as pension plans, will generally not have to pay federal income tax,
or any state and local income taxes, on the dividends and capital gain
distributions they receive from the Fund, whether paid in cash or additional
shares. Shareholders who are not tax-exempt entities will normally have to pay
U.S. federal income taxes, and any state and local income taxes, on the
dividends and capital gain distributions from the Fund, whether paid in cash or
additional shares. Such shareholders should consult their tax advisers before
making an investment in the Fund.
11
<PAGE>
The Fund intends to withhold U.S. federal income tax at a rate of 30% on
dividends and certain other payments that are subject to such withholding, and
that are made to non-exempt persons who are neither citizens nor residents of
the U.S., regardless of whether a lower rate may be permitted under an
applicable law or treaty. The Fund is also required in certain circumstances to
apply backup withholding of 31% on reportable dividends and redemption proceeds
paid to any shareholder (including a shareholder who is neither a citizen nor a
resident of the U.S.) who does not furnish to the Fund certain information and
certifications or who is otherwise subject to backup withholding. However,
backup withholding will not be applied to such shareholder payments which have
had 30% withholding taken. Prospective shareholders should read the Account
Application for information regarding backup withholding of federal income tax
and should consult their own tax advisers as to the tax consequences of an
investment in the Fund.
For individual shareholders a statement setting forth the federal income status
of all dividends and distributions for each calendar year will be sent promptly
after the end of such year.
NET ASSET VALUE
The net asset value per share of the Fund is determined each day during which
the Exchange is open for trading. This determination is made once each day as of
the close of regular trading on the Exchange by deducting the amount of the
Fund's liabilities from the value of the Fund's assets and dividing the
difference by the number of shares outstanding. Assets in the Fund's portfolio
are valued on the basis of their current values or otherwise at their fair
values, as described in the Statement of Additional Information. The net asset
value of shares is effective for orders accepted by MFD prior to its
calculation.
DESCRIPTION OF SHARES, VOTING RIGHTS AND LIABILITIES
The Fund currently has one class of shares, entitled Shares of Beneficial
Interest (without par value). The Trust has reserved the right to create and
issue additional classes and series of shares, in which case each class of
shares of a series would participate equally in the earnings, dividends and
assets attributable to that class of that particular series. Shareholders are
entitled to one vote for each share held and shares of each series would be
entitled to vote separately to approve investment advisory agreements or changes
in investment restrictions, but shares of all series would vote together in the
election of Trustees and selection of accountants. Additionally, each series
will vote separately on any material increases in the fees under its
Distribution Plan or on any other matter that affects solely that series, but
will otherwise vote together with all other series on all other matters. The
Trust does not intend to hold annual shareholder meetings. The Declaration of
Trust provides that a Trustee may be removed from office in certain instances.
See "Description of Shares, Voting Rights and Liabilities" in the Statement of
Additional Information.
Each share of the Fund represents an equal proportionate interest in the Fund
with each share, subject to the liabilities of the particular series. Shares
have no pre-emptive or conversion rights. Shares are fully paid and
non-assessable. Should the Fund be liquidated, shareholders are entitled to
share PRO RATA in the net assets available for distribution to shareholders.
Shares will remain on deposit with the Shareholder Servicing Agent and
certificates will not be issued except in connection with pledges and
assignments and in certain other limited circumstances.
The Trust is an entity of the type commonly known as a "Massachusetts business
trust." Under Massachusetts law, shareholders of such a trust may, under certain
circumstances, be held personally liable as partners for its obligations.
However, the risk of a shareholder incurring financial loss on account of
shareholder liability is limited to circumstances in which both inadequate
insurance existed (E.G., fidelity bonding and omission insurance) and the Trust
itself was unable to meet its obligations.
PERFORMANCE INFORMATION
From time to time, the Fund will provide total rate of return quotations for its
shares and may also quote fund rankings in the relevant fund category from
various sources, such as the Lipper Analytical Services, Inc. and Wiesenberger
Investment Companies Service. From time to time the Fund may also compare its
performance to the LSI. Total rate of return quotations will reflect the average
annual percentage change over stated periods in the value of an investment in
shares of the Fund with
12
<PAGE>
all distributions reinvested. The Fund's total rate of return quotations are
based on historical performance and are not intended to indicate future
performance. Total rate of return reflects all components of investment return
over a stated period of time. The Fund's quotations may from time to time be
used in advertisements, shareholder reports or other communications to
shareholders. For a discussion of the manner in which the Fund will calculate
its total rate of return, see the Statement of Additional Information. In
addition to information provided in shareholder reports, the Fund may, in its
discretion, from time to time, make a list of all or a portion of its holdings
available to investors upon request.
EXPENSES
The Trust pays the compensation of the Trustees who are not officers of MFS and
all expenses of the Fund (other than those assumed by MFS or MFD) including but
not limited to: governmental fees; interest charges; taxes; membership dues in
the Investment Company Institute allocable to the Fund; fees and expenses of
independent auditors, of legal counsel, and of any transfer agent, registrar or
dividend disbursing agent of the Fund; expenses of redeeming shares and
servicing shareholder accounts; expenses of preparing, printing and mailing
share certificates, prospectuses, periodic reports, notices and proxy statements
to shareholders and 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 State
Street Bank and Trust Company, the Fund's Custodian, for all services to the
Fund, including safekeeping of funds and securities and maintaining required
books and accounts; expenses of calculating the net asset value of shares of the
Fund; and expenses of shareholder meetings. Expenses relating to the issuance,
registration and qualification of shares of the Fund and the preparation,
printing and mailing of prospectuses are borne by the Fund except that the
Distribution Agreement with MFD requires MFD to pay for prospectuses that are to
be used for sales purposes. Expenses of the Trust which are not attributable to
a specific series of the Trust are allocated between the series in a manner
believed by management of the Trust to be fair and equitable.
Subject to termination or revision at the discretion of MFS, MFS has agreed to
bear until December 31, 1998 the foregoing expenses of the Trust such that the
Fund's aggregate operating expenses do not exceed 1.00% per annum of its average
daily net assets. Such payments by MFS are subject to reimbursement by the Fund,
which will be accomplished by the payment by the Fund of an expense
reimbursement fee to MFS computed and paid monthly at a percentage of its
average daily net assets for its then current fiscal year, with a limitation
that immediately after such payment the aggregate operating expenses of the Fund
would not exceed 1.00% of its average daily net assets. The expense
reimbursement agreement terminates for the Fund on the earlier of the date on
which payments made thereunder by such Fund equal the prior payment of such
reimbursable expenses by MFS or December 31, 1998.
8. SHAREHOLDER SERVICES
Shareholders with questions concerning the shareholder services described below
or concerning other aspects of the Fund should contact the Shareholder Servicing
Agent.
ACCOUNT AND CONFIRMATION STATEMENTS -- Each shareholder will receive
confirmation statements showing the transaction activity in its account.
DISTRIBUTION OPTIONS -- The following options are available to all accounts and
may be changed as often as desired by notifying the Shareholder Servicing Agent:
-- Dividends and capital gain distributions reinvested in additional shares.
This option will be assigned if no other option is specified.
-- Dividends in cash; capital gain distributions reinvested in additional
shares.
-- Dividends and capital gain distributions in cash.
13
<PAGE>
Dividends and capital gains distributions will be reinvested (net of any tax
withholding) in additional full and fractional shares at the net asset value in
effect at the close of business on the record date. Dividends and capital gain
distributions in amounts less than $10 will automatically be reinvested in
additional shares of the Fund.
Any request to change a distribution option must be received by the Shareholder
Servicing Agent by the record date for a dividend or distribution in order to be
effective for that dividend or distribution. No interest will accrue on amounts
represented by uncashed distribution or redemption checks.
-------------------
The Fund's Statement of Additional Information, dated November 16, 1995,
contains more detailed information about the Trust and the Fund, including
information related to (i) the investment objective, policies and restrictions
(ii) the Trustees, officers and investment adviser, (iii) portfolio trading,
(iv) the Fund's shares, including rights and liabilities of shareholders, (v)
the tax status of dividends and distributions, (vi) the Distribution Plan and
(vii) the method used to calculate total rate of return quotations.
14
<PAGE>
INVESTMENT ADVISER
Massachusetts Financial Services Company
500 Boylston Street, Boston, MA 02116
(617) 954-5000
DISTRIBUTOR
MFS Fund Distributors, Inc.
500 Boylston Street, Boston, MA 02116
(617) 954-5000
CUSTODIAN AND DIVIDEND DISBURSING AGENT
State Street Bank and Trust Company
225 Franklin Street, Boston, MA 02110
SHAREHOLDER SERVICING AGENT
MFS Service Center, Inc.
500 Boylston Street, Boston, MA 02116
Toll free: 800-637-8730
MAILING ADDRESS:
P.O. Box 1400, Boston, MA 02104-9985
INDEPENDENT ACCOUNTANTS
Deloitte & Touche LLP
125 Summer Street, Boston, MA 02110
[LOGO]
MFS-Registered Trademark-
Union Standard-SM-
Research Fund
500 Boylston Street, Boston, MA 02116
UST-1-2/95/1.5M
MFS-Registered Trademark-
Union Standard-SM-
Research Fund
[LOGO]
PROSPECTUS
NOVEMBER 16, 1995
<PAGE>
MFS-REGISTERED TRADEMARK-
UNION STATEMENT OF
STANDARD-SM- RESEARCH FUND ADDITIONAL INFORMATION
NOVEMBER 16, 1995
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Page
----
<C> <S> <C>
1. General Information and Definitions................................. 2
2. Additional Investment Techniques and Risk Factors................... 2
3. Investment Restrictions............................................. 3
4. Management of the Fund.............................................. 4
Trustees.......................................................... 4
Officers.......................................................... 4
Investment Adviser................................................ 4
Custodian......................................................... 5
Shareholder Servicing Agent....................................... 5
Distributor....................................................... 5
5. Portfolio Transactions and Brokerage Commissions.................... 5
6. Tax Status.......................................................... 6
7. Determination of Net Asset Value; Performance Information........... 7
8. Distribution Plan................................................... 8
9. Description of Shares, Voting Rights and Liabilities................ 8
10. Independent Accountants and Financial Statements.................... 9
Appendix A.......................................................... A-1
</TABLE>
MFS UNION STANDARD-SM- RESEARCH FUND
A Series of MFS Union Standard Trust
500 Boylston Street, Boston, Massachusetts 02116
(617) 954-5000
This Statement of Additional Information sets forth information which may be of
interest to investors but which is not necessarily included in the Fund's
Prospectus, dated November 16, 1995. This Statement of Additional Information
should be read in conjunction with the Prospectus, a copy of which may be
obtained without charge by contacting the Shareholder Servicing Agent (see back
cover for address and phone number).
THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND IS AUTHORIZED
FOR DISTRIBUTION TO PROSPECTIVE INVESTORS ONLY IF PRECEDED OR ACCOMPANIED BY A
CURRENT PROSPECTUS.
UST-13 2/95/370
<PAGE>
1. GENERAL INFORMATION AND DEFINITIONS
MFS Union Standard-SM- Trust (the "Trust") is a professionally managed open-end,
diversified, management investment company (a "mutual fund") designed for
pension plans sponsored by labor unions and pension plans in which union members
participate. The Trust currently consists of two separate series or funds: MFS
Union Standard-SM- Research Fund (the "Research Fund" or the "Fund") and MFS
Union Standard-SM- Equity Fund (the "Equity Fund"). This Statement of Additional
Information relates only to the Research Fund. The Equity Fund is offered
pursuant to a separate prospectus and statement of additional information which
may be obtained by contacting the Shareholder Servicing Agent (see back cover
for address and phone number). Additional funds may be created by the Trustees
from time to time. The Fund offers its shares pursuant to a prospectus dated
November 16, 1995, as supplemented or amended from time to time (the
"Prospectus").
The Fund's investment adviser and distributor is, respectively, Massachusetts
Financial Services Company ("MFS" or the "Adviser") and MFS Fund Distributors,
Inc. ("MFD" or the "Distributor"), each a Delaware corporation.
2. ADDITIONAL INVESTMENT TECHNIQUES AND RISK FACTORS
LENDING OF SECURITIES
The Fund may seek to increase its income by lending portfolio securities. Such
loans will usually be made only to member banks of the Federal Reserve System
and to member firms (and subsidiaries thereof) of the New York Stock Exchange
(the "Exchange") and would be required to be secured continuously by collateral
in cash, cash equivalents, or U.S. Government securities maintained on a current
basis at an amount at least equal to the market value of the securities loaned.
The Fund would have the right to call a loan and obtain the securities loaned at
any time on customary industry settlement notice (which will usually not exceed
five business days). During the existence of a loan, the Fund would continue to
receive the equivalent of the interest or dividends paid by the issuer on the
securities loaned and would also receive compensation based on investment of the
collateral. The Fund would not, however, have the right to vote any securities
having voting rights during the existence of the loan, but would call the loan
in anticipation of an important vote to be taken among holders of the securities
or of the giving or withholding of their consent on a material matter affecting
the investment. As with other extensions of credit, there are risks of delay in
recovery or even loss of rights in the collateral should the borrower fail
financially. However, the loans would be made only to firms deemed by MFS to be
of good standing, and when, in the judgment of MFS, the consideration which
could be earned currently from securities loans of this type justifies the
attendant risk. If MFS determines to make securities loans, it is not intended
that the value of the securities loaned would exceed 30% of the value of the
Fund's total assets.
WHEN-ISSUED SECURITIES
The Fund may purchase securities on a "when-issued" or on a "forward delivery"
basis. It is expected that, under normal circumstances, the Fund will take
delivery of such securities. When the Fund commits to purchase a security on a
"when-issued" or on a "forward delivery" basis, it will set up procedures
consistent with the General Statement of Policy of the Securities and Exchange
Commission (the "SEC") concerning such purchases. Since that policy currently
recommends that an amount of the Fund's assets equal to the amount of the
purchase be held aside or segregated to be used to pay for the commitment, the
Fund will always have cash, short-term money market instruments or high quality
debt securities sufficient to cover any commitments or to limit any potential
risk. However, although the Fund does not intend to make such purchases for
speculative purposes and intends to adhere to the provisions of SEC policies,
purchases of securities on such bases may involve more risk than other types of
purchases. For example, the Fund may have to sell assets which have been set
aside in order to meet redemptions. Also, if the Fund determines it is necessary
to sell the "when-issued" or "forward delivery" securities before delivery, it
may incur a loss because of market fluctuations since the time the commitment to
purchase such securities was made. When the time comes to pay for "when-issued"
or "forward delivery" securities, the Fund will meet its obligations from the
then-available cash flow on the sale of securities, or, although it would not
normally expect to do so, from the sale of the "when-issued" or "forward
delivery" securities themselves (which may have a value greater or less than the
Fund's payment obligation).
REPURCHASE AGREEMENTS
The Fund may enter into repurchase agreements with sellers who are member firms
(or subsidiaries thereof) of the Exchange, members of the Federal Reserve
System, recognized primary U.S. Government securities dealers or institutions
which MFS has determined to be of comparable creditworthiness. The securities
that the Fund purchases and holds through its agent are U.S. Government
securities, the values, including accrued interest, of which are equal to or
greater than the repurchase price agreed to be paid by the seller. The
repurchase price may be higher than the purchase price, the difference being
income to the Fund, or the purchase and repurchase prices may be the same, with
interest at a standard rate due to the Fund together with the repurchase price
on repurchase. In either case, the income to the Fund is unrelated to the
interest rate on the U.S. Government securities.
The repurchase agreement provides that in the event the seller fails to pay the
price agreed upon on the agreed upon delivery date or upon demand, as the case
may be, the Fund will have the right to liquidate the securities. If at the time
the Fund is contractually entitled to exercise its right to liquidate the
securities, the seller is subject to a proceeding under the bankruptcy laws or
its assets are otherwise subject to a stay order, the Fund's exercise of its
right to liquidate the securities may be delayed and result in certain losses
and costs to the Fund. The Fund has adopted and follows procedures which are
intended to minimize the risks of repurchase agreements. For example, the Fund
only enters into repurchase agreements after MFS has determined that the seller
is creditworthy, and MFS monitors the seller's creditworthiness on an ongoing
basis. Moreover, under such agreements, the value, including accrued interest,
of the securities (which are marked to market every business day) is required to
be greater than the repurchase price, and the Fund has the right to make margin
calls at any time if the value of the securities falls below the agreed upon
margin.
PORTFOLIO TRADING
The Fund anticipates that its portfolio turnover rate will not exceed 100%
during its current fiscal year.
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3. INVESTMENT RESTRICTIONS
The Fund has adopted the following restrictions which cannot be changed without
the approval of the holders of a majority of the Fund's shares (which, as used
in this Statement of Additional Information, means the lesser of (i) more than
50% of the outstanding shares of the Trust or the Fund, as applicable, or (ii)
67% or more of the outstanding shares of the Trust or the Fund, as applicable,
present at a meeting if holders of more than 50% of the outstanding shares of
the Trust or the Fund, as applicable, are represented in person or by proxy).
Except for Investment Restriction (1), these investment restrictions and
policies are adhered to at the time of purchase or utilization of assets; a
subsequent change in circumstances will not be considered to result in a
violation of policy.
The Trust, on behalf of the Fund, may not:
(1) borrow amounts in excess of 33 1/3% of its assets including amounts
borrowed;
(2) underwrite securities issued by other persons except insofar as the Fund
may technically be deemed an underwriter under the Securities Act of 1933 in
selling a portfolio security;
(3) purchase or sell real estate (including limited partnership interests
but excluding securities secured by real estate or interests therein and
securities of companies, such as real estate investment trusts, which deal in
real estate or interests therein), interests in oil, gas or mineral leases,
commodities or commodity contracts (excluding options, options on futures
contracts, options on stock indices and any other type of option, and futures
contracts) in the ordinary course of its business. The Fund reserves the
freedom of action to hold and to sell real estate, mineral leases,
commodities or commodity contracts (including options, options on futures
contracts, options on stock indices and any other type of option, and futures
contracts) acquired as a result of the ownership of securities;
(4) issue any senior securities except as permitted by the 1940 Act. For
purposes of this restriction, collateral arrangements with respect to any
type of option (including options on futures contracts, options and options
on stock indices), forward contracts and futures contracts and collateral
arrangements with respect to initial and variation margin are not deemed to
be the issuance of a senior security;
(5) make loans to other persons. For these purposes, the purchase of
short-term commercial paper, the purchase of a portion or all of an issue of
debt securities, the lending of portfolio securities, or the investment of
the Fund's assets in repurchase agreements, shall not be considered the
making of a loan; or
(6) purchase any securities of an issuer of a particular industry, if as a
result, 25% or more of its gross assets would be invested in securities of
issuers whose principal business activities are in the same industry (except
obligations issued or guaranteed by the U.S. Government or its agencies and
instrumentalities and repurchase agreements collateralized by such
obligations).
In addition, the Fund has adopted the following nonfundamental policies which
may be changed without shareholder approval. The Trust, on behalf of the Fund,
will not:
(1) invest in illiquid investments, including securities subject to legal or
contractual restrictions on resale or for which there is no readily available
market (e.g., trading in the security is suspended, or, in the case of
unlisted securities, where no market exists) if more than 15% of the Fund's
net assets (taken at market value) would be invested in such securities.
Repurchase agreements maturing in more than seven days will be deemed to be
illiquid for purposes of the Fund's limitation on investment in illiquid
securities. Securities that are not registered under the Securities Act of
1933, as amended, and sold in reliance on Rule 144A thereunder, but are
determined to be liquid by the Trust's Board of Trustees (or its delegee),
will not be subject to this 15% limitation;
(2) invest more than 5% of the value of the Fund's net assets, valued at the
lower of cost or market, in warrants. Included within such amount, but not to
exceed 2% of the value of the Fund's net assets, may be warrants which are
not listed on the New York or American Stock Exchange. Warrants acquired by
the Fund in units or attached to securities may be deemed to be without
value;
(3) purchase securities issued by any other investment company in excess of
the amount permitted by the 1940 Act, except when such purchase is part of a
plan of merger or consolidation;
(4) purchase or retain securities of an issuer any of whose officers,
directors, trustees or security holders is an officer or Trustee of the Fund,
or is an officer or a director of the investment adviser of the Fund, if one
or more of such persons also owns beneficially more than 0.5% of the
securities of such issuer, and such persons owning more than 0.5% of such
securities together own beneficially more than 5% of such securities;
(5) purchase any securities or evidences of interest therein on margin,
except that the Fund may obtain such short-term credit as may be necessary
for the clearance of any transaction and except that the Fund may make margin
deposits in connection with any type of option (including options on futures
contracts, options and options on stock indices) and futures contracts;
(6) sell any security which the Fund does not own unless by virtue of its
ownership of other securities the Fund has at the time of sale a right to
obtain securities without payment of further consideration equivalent in kind
and amount to the securities sold and provided that if such right is
conditional, the sale is made upon the same conditions;
(7) invest more than 5% of its gross assets in companies which, including
predecessors, controlling persons, sponsoring entities, general partners and
guarantors, have a record of less than three years' continuous operation or
relevant business experience;
(8) pledge, mortgage or hypothecate in excess of 33 1/3% of its gross
assets. For purposes of this restriction, collateral arrangements with
respect to any type of option (including options on futures contracts,
options and options on stock indices), futures contracts and payments of
initial and variation margin in connection therewith, are not considered a
pledge of assets;
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(9) purchase securities while borrowings from banks under a line of credit
or similar arrangement exceed 5% of the Fund's total assets;
(10) purchase or sell any put or call option or any combination thereof,
provided that this shall not prevent (a) the purchase, ownership, holding or
sale of (i) warrants where the grantor of the warrants is the issuer of the
underlying securities or (ii) put or call options or combinations thereof
with respect to securities, indexes of securities, options on futures
contracts or (b) the purchase, ownership, holding or sale of contracts for
the future delivery of securities or currencies; or
(11) invest for the purpose of exercising control or management.
The Fund's limitations, policies and ratings restrictions are adhered to at the
time of purchase or utilization of assets; a subsequent change in circumstances
will not be considered to result in a violation of policy.
4. MANAGEMENT OF THE FUND
The Board of Trustees of the Trust provides broad supervision over the affairs
of the Fund. MFS is responsible for the investment management of the Fund's
assets and the officers of the Trust are responsible for its operations. The
Trustees and officers of the Trust are listed below, together with their
principal occupations during the past five years. (Their titles may have varied
during that period.)
TRUSTEES
A. KEITH BRODKIN* -- Chairman; Massachusetts Financial Services Company,
Chairman.
NELSON J. DARLING, JR. -- Director or Trustee of several corporations or trusts,
including: Eastern Enterprises (diversified holding company), Trustee.
Address: 18 Tremont Street, Boston, Massachusetts
WILLIAM R. GUTOW -- Private Investor; Real Estate Consultant; Capitol
Entertainment (Blockbuster Video Franchise), Senior Vice President (since
1989).
Address: 3102 Maple Avenue, #100, Dallas, Texas
OFFICERS
W. THOMAS LONDON* -- Treasurer; Massachusetts Financial Services Company, Senior
Vice President.
STEPHEN E. CAVAN* -- Secretary and Clerk; Massachusetts Financial Services
Company, Senior Vice President, General Counsel and Assistant Secretary.
JAMES R. BORDEWICK, JR.* -- Assistant Secretary; Massachusetts Financial
Services Company, Vice President and Associate General Counsel.
JAMES O. YOST* -- Assistant Treasurer; Massachusetts Financial Services Company,
Vice President.
--------------
*"Interested persons" (as defined in the 1940 Act) of the Adviser, whose address
is 500 Boylston Street, Boston, Massachusetts 02116.
Mr. Brodkin and each officer holds comparable positions with certain affiliates
of MFS or with certain other funds of which MFS or a subsidiary is the
investment adviser or distributor. Messrs. Brodkin and Cavan are the Chairman
and the Secretary, respectively, of MFD and hold similar positions with certain
other MFS affiliates.
The Trust pays the compensation of the Trustees who are not officers of MFS (who
will each receive $2600 annually plus $600 per meeting and committee meeting
attended). Set forth in Appendix A hereto is certain information concerning the
cash compensation paid to non-interested Trustees.
The Declaration of Trust provides that the Trust will indemnify its Trustees and
officers against liabilities and expenses incurred in connection with litigation
in which they may be involved because of their offices with the Trust, unless,
as to liabilities of the Trust or its shareholders, it is finally adjudicated
that they engaged in willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in their offices, or with respect to
any matter, unless it is adjudicated that they did not act in good faith in the
reasonable belief that their actions were in the best interest of the Trust. In
the case of settlement, such indemnification will not be provided unless it has
been determined pursuant to the Declaration of Trust, that such officers or
Trustees have not engaged in willful misfeasance, bad faith, gross negligence or
reckless disregard of their duties.
INVESTMENT ADVISER
MFS and its predecessor organizations have a history of money management dating
from 1924. MFS is a wholly owned subsidiary of Sun Life of Canada (U.S.) which
in turn is a wholly owned subsidiary of Sun Life Assurance Company of Canada.
MFS manages the assets of the Fund pursuant to an Investment Advisory Agreement
with the Trust on behalf of the Fund dated as of November 16, 1995 (the
"Advisory Agreement"). MFS provides the Fund with overall investment advisory
and administrative services, as well as general office facilities. Subject to
such policies as the Trustees may determine, MFS makes investment decisions for
the Fund. For these services and facilities, the Adviser receives a management
fee, computed and paid monthly, in an amount equal to 0.60% per annum of the
average daily net assets of the Fund.
In order to comply with the expense limitations of certain state securities
commissions, MFS will reduce its management fee or otherwise reimburse the Fund
for any expenses, exclusive of interest, taxes and brokerage commissions,
incurred by the Fund in any fiscal year to the extent such expenses exceed the
most restrictive of such state expense limitations. MFS will make appropriate
adjustments to such reductions and reimbursements in response to any amendment
or rescission of the various state requirements.
MFS pays the compensation of the Trust's officers and of any Trustee who is an
officer of MFS. MFS also furnishes at its own expense all necessary
administrative services, including office space, equipment, clerical personnel,
investment advisory facilities, and all executive and supervisory personnel
necessary for managing the Fund's investments, effecting its portfolio
transactions and, in general, administering its affairs.
The Advisory Agreement with the Fund will remain in effect until November 16,
1997, and will continue in effect thereafter only if such continuance is
specifically approved at least annually by the Board of Trustees or by vote of a
majority of the Fund's shares (as defined in "Investment Restrictions") and, in
either case, by a majority of the Trustees who are not parties to the Advisory
Agreement or interested persons of any such party. The Advisory Agreement
terminates automatically if it is assigned and may be terminated without penalty
by vote of a majority of the Fund's shares (as defined in "Investment
Restrictions") or by either party on not more than 60 days' nor less than 30
days' written notice. The Advisory Agreement for the Fund provides
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that if MFS ceases to serve as the investment adviser to the Fund, the Fund will
change its name so as to delete the term "MFS" and that MFS may render services
to others and may permit other fund clients to use the term "MFS" in their
names. The Advisory Agreement also provides that neither MFS nor its personnel
shall 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 or their duties or by reason of reckless
disregard of its or their obligations and duties under the Advisory Agreement.
CUSTODIAN
State Street Bank and Trust Company (the "Custodian") is the custodian of the
Trust's assets. The Custodian's responsibilities include safekeeping and
controlling the Fund's cash and securities, handling the receipt and delivery of
securities, determining income and collecting interest and dividends on the
Fund's investments, maintaining books of original entry for portfolio and fund
accounting and other required books and accounts, and calculating the daily net
asset value of shares of the Fund. The Custodian does not determine the
investment policies of the Fund or decide which securities the Fund will buy or
sell. The Fund may, however, invest in securities of the Custodian and may deal
with the Custodian as principal in securities transactions. The Custodian also
serves as the dividend and distribution disbursing agent of the Fund. The
Custodian has contracted with MFS for MFS to perform certain accounting
functions related to certain transactions for which the Adviser receives
remuneration on a cost basis.
SHAREHOLDER SERVICING AGENT
MFS Service Center, Inc. (the "Shareholder Servicing Agent"), a wholly owned
subsidiary of MFS, is the Fund's shareholder servicing agent, pursuant to a
Shareholder Servicing Agent Agreement with the Trust on behalf of the Fund,
dated as of December 8, 1993 (the "Agency Agreement"). The Shareholder Servicing
Agent's responsibilities under the Agency Agreement include administering and
performing transfer agent functions and the keeping of records in connection
with the issuance, transfer and redemption of shares of the Fund. For these
services, the Shareholder Servicing Agent will receive a fee based on the number
of shareholder accounts, computed and paid monthly. In addition, the Shareholder
Servicing Agent will be reimbursed by the Fund for certain expenses incurred by
the Shareholder Servicing Agent on behalf of the Fund. State Street Bank and
Trust Company, the dividend and distribution disbursing agent for the Fund, has
contracted with the Shareholder Servicing Agent to administer and perform
certain dividend and distribution disbursing functions for the Fund.
DISTRIBUTOR
MFD, a wholly owned subsidiary of MFS, serves as the distributor for the
continuous offering of shares of the Fund pursuant to a Distribution Agreement
dated as of December 8, 1993 (the "Distribution Agreement").
The Distribution Agreement will remain in effect until August 1, 1996 and will
continue in effect thereafter only if such continuance is specifically approved
at least annually by the Board of Trustees or by vote of a majority of the
Trust's shares (as defined in "Investment Restrictions") and in either case, by
a majority of the Trustees who are not parties to such Distribution Agreement or
interested persons of any such party. The Distribution Agreement terminates
automatically if it is assigned and may be terminated without penalty by either
party on not more than 60 days' nor less than 30 days' notice.
5. PORTFOLIO TRANSACTIONS AND BROKERAGE
COMMISSIONS
Specific decisions to purchase or sell securities for the Fund are made by
employees of MFS, who are appointed and supervised by its senior officers.
Changes in the Fund's investments are reviewed by the Board of Trustees.
The primary consideration in placing portfolio security transactions with
broker-dealers for execution is to obtain and maintain the availability of
execution at the most favorable prices and in the most effective manner
possible. MFS has complete freedom as to the markets in and the broker-dealers
through which it seeks this result. MFS attempts to achieve this result by
selecting broker-dealers to execute portfolio transactions on behalf of the Fund
and other clients of MFS on the basis of their professional capability, the
value and quality of their brokerage services, and the level of their brokerage
commissions. In the case of securities, such as government securities, which are
principally traded in the over-the-counter market (where no stated commissions
are paid but the prices include a dealer's markup or markdown), MFS normally
seeks to deal directly with the primary market makers, unless in its opinion,
better prices are available elsewhere. In the case of securities purchased from
underwriters, the cost of such securities generally includes a fixed
underwriting commission or concession. From time to time, soliciting dealer fees
are available to MFS on the tender of the Fund's portfolio securities in
so-called tender or exchange offers. Such soliciting dealer fees are in effect
recaptured for the Fund by MFS. At present no other recapture arrangements are
in effect.
Under the Advisory Agreement and as permitted by Section 28(e) of the Securities
Exchange Act of 1934, MFS may cause the Fund to pay a broker-dealer which
provides brokerage and research services to MFS an amount of commission for
effecting a securities transaction for the Fund in excess of the amount other
broker-dealers would have charged for the transaction if MFS determines in good
faith that the greater commission is reasonable in relation to the value of the
brokerage and research services provided by the executing broker-dealer viewed
in terms of either a particular transaction or MFS's overall responsibilities to
the Fund or to its other clients. Not all of such services are useful or of
value in advising the Fund.
The term "brokerage and research services" includes advice as to the value of
securities, the advisability of purchasing or selling securities, and the
availability of purchasers or sellers of securities; furnishing analyses and
reports concerning issues, industries, securities, economic factors and trends,
portfolio strategy and the performance of accounts; and effecting securities
transactions and performing functions incidental thereto such as clearance and
settlement.
Although commissions paid on every transaction will, in the judgment of MFS, be
reasonable in relation to the value of the brokerage services provided,
commissions exceeding those which another broker might charge may be paid to
broker-dealers who were selected to execute transactions on behalf of the Fund
and MFS' other clients in part for providing advice as to the availability of
purchasers or sellers of securities and services in effecting securities
transactions and performing functions incidental thereto such as clearance and
settlement.
Broker-dealers may be willing to furnish statistical, research and other factual
information or services ("Research") to MFS for no consideration other than
brokerage or underwriting commissions. Securities may be bought or sold from
time to time through such broker-dealers on behalf of the Fund. The Trustees
(together with the Trustees of the MFS Funds) have directed MFS to allocate a
total of $20,000 of commission
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business from the various MFS Funds to the Pershing Division of Donaldson,
Lufkin & Jenrette as consideration for the annual renewal of the Lipper
Directors' Analytical Data Service (which provides information useful to the
Trustees in reviewing the relationship between the Fund and MFS).
The investment management personnel of MFS attempt to evaluate the quality of
Research provided by brokers. Results of this effort are sometimes used by MFS
as a consideration in the selection of brokers to execute portfolio
transactions. However, MFS is unable to quantify the amount of commissions which
will be paid as a result of such Research because a substantial number of
transactions will be effected through brokers which provide Research but which
were selected principally because of their execution capabilities.
The management fee that the Fund pays to MFS will not be reduced as a
consequence of the receipt of brokerage and research services by MFS. To the
extent the Fund's portfolio transactions are used to obtain such services, the
brokerage commissions paid by the Fund will exceed those that might otherwise be
paid, by an amount which cannot be presently determined. Such services would be
useful and of value to MFS in serving both the Fund and other clients and,
conversely, such services obtained by the placement of brokerage business of
other clients would be useful to MFS in carrying out its obligations to the
Fund. While such services are not expected to reduce the expenses of MFS, MFS
would, through use of the services, avoid the additional expenses which would be
incurred if it should attempt to develop comparable information through its own
staff.
In certain instances there may be securities which are suitable for the Fund's
portfolio as well as for that of one or more of the other clients of MFS or any
subsidiary of MFS. Investment decisions for the Fund and for such other clients
are made with a view to achieving their respective investment objectives. It may
develop that a particular security is bought or sold for only one client even
though it might be held by, or bought or sold for, other clients. Likewise, a
particular security may be bought for one or more clients when one or more other
clients are selling that same security. Some simultaneous transactions are
inevitable when several clients receive investment advice from the same
investment adviser, particularly when the same security is suitable for the
investment objectives of more than one client. When two or more clients are
simultaneously engaged in the purchase or sale of the same security, the
securities are allocated among clients in a manner believed to be equitable to
each. It is recognized that in some cases this system could have a detrimental
effect on the price or volume of the security as far as the Fund is concerned.
In other cases, however, it is believed that the Fund's ability to participate
in volume transactions will produce better executions for the Fund.
6. TAX STATUS
The Fund intends to be treated and to qualify each year as a "regulated
investment company" under Subchapter M of the Internal Revenue Code of 1986, as
amended (the "Code"), by meeting all applicable requirements of Subchapter M,
including requirements as to the nature of the Fund's gross income, the amount
of Fund distributions, and the composition and holding period of the Fund's
portfolio assets. Because the Fund intends to distribute all of its net
investment income and net realized capital gains to shareholders in accordance
with the timing and certain other requirements imposed by the Code, it is not
expected that the Fund will be required to pay any federal income or excise
taxes. If the Fund should fail to qualify for treatment as a "regulated
investment company" in any year, the Fund would incur regular corporate federal
income tax upon its taxable income and Fund distributions would generally be
taxable as ordinary dividend income to non-exempt shareholders. The Fund will be
subject to a nondeductible 4% excise tax ("Excise Tax") to the extent it fails
to distribute by the end of any calendar year substantially all of its ordinary
income for that year and capital gain net income for the one-year period ending
on October 31 of that year, plus certain other amounts. As long as the Fund
qualifies for treatment as a regulated investment company under the Code, it
will not be subject to any Massachusetts excise or income taxes.
Shareholders of the Fund who are not tax-exempt entities normally will have to
pay federal income taxes and any state or local taxes on the dividends and
capital gain distributions they receive from the Fund. Dividends from ordinary
income and any distributions from net short-term capital gains, whether paid to
shareholders who are non tax-exempt entities in cash or additional shares, are
taxable to these shareholders as ordinary income for federal income tax
purposes. A portion of the Fund's ordinary income dividends (but none of its
capital gains) is normally eligible for the dividends-received deduction for
corporations if the recipient otherwise qualifies for that deduction with
respect to its holding of the Fund's shares. Availability of the deduction to
particular corporate shareholders is subject to certain limitations and deducted
amounts may be subject to the alternative minimum tax or result in certain basis
adjustments. Distributions of net capital gain (I.E., the excess of the net
long-term capital gains over short-term capital losses), whether received in
cash or reinvested in additional shares, if designated as such by the Fund, are
taxable to non-tax-exempt shareholders as long-term capital gains for federal
income tax purposes without regard to the length of time the shareholders have
held their shares. Fund dividends which are declared in October, November, or
December, and paid the following January will be taxable to non-tax-exempt
shareholders as if received on December 31 of the year in which they are
declared.
Any Fund distribution will have the effect of reducing the per share net asset
value of shares in the Fund by the amount of the distribution. Shareholders
purchasing shares in the Fund shortly before the record date of any taxable
dividend or other distribution may thus pay the full price for the shares and
then effectively receive a portion of the purchase price back as a taxable
distribution.
In general, any gain or loss realized upon a taxable disposition of shares of
the Fund by a shareholder that holds such shares as a capital asset will be
treated as long-term capital gain or loss if the shares have been held for more
than twelve months and otherwise as short-term capital gain or loss. However,
any loss realized upon a disposition of shares in a Fund held for six months or
less will be treated as a long-term capital loss to the extent of any
distributions of net capital gain made with respect to those shares. Any loss
realized upon a redemption of shares may also be disallowed under rules relating
to wash sales.
The Fund's current dividend and accounting policies will affect the amount,
timing, and character of distributions to shareholders, and may, under certain
circumstances, make an economic return of capital taxable to shareholders. Any
investment by the Fund in certain securities purchased at a market discount will
cause it to realize income prior to the receipt of cash payments with respect to
these securities. In order to distribute this income and avoid a tax on such
Fund, the Fund may be required to liquidate portfolio securities that it might
otherwise have continued to hold, potentially resulting in additional taxable
gain or loss to the Fund.
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7. DETERMINATION OF NET ASSET VALUE;
PERFORMANCE INFORMATION
NET ASSET VALUE
The net asset value per share of the Fund is determined each day during which
the Exchange is open for trading. As of the date of this Statement of Additional
Information, the Exchange is open for trading every weekday except for the
following holidays (or the days on which they are observed): New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day). This determination is made once during each
such day as of the close of regular trading on the Exchange by deducting the
amount of the Fund's liabilities from the value of its assets and dividing the
difference by the number of shares of the Fund outstanding. Securities in the
Fund's portfolio (other than short-term obligations) for which the principal
market is one or more securities or commodities exchanges will be valued at the
last reported sale price or at the settlement price prior to the determination
(or if there has been no current sale, at the closing bid price) on the primary
exchange on which such securities are traded; but if a securities exchange is
not the principal market for securities, such securities will, if market
quotations are readily available, be valued at current bid prices, unless such
securities are reported on the NASDAQ system, in which case they are valued at
the last sale price or, if no sales occurred during the day, at the last quoted
bid price. Short-term obligations, if any, in the Fund's portfolio are valued at
amortized cost, which constitutes fair value as determined by the Board of
Trustees. Short-term securities with a remaining maturity in excess of 60 days
will be valued based upon dealer supplied valuations. Portfolio securities for
which there are no quotations or valuations are valued at fair value as
determined in good faith by or at the direction of the Board of Trustees. A
share's net asset value is effective for orders accepted by MFD, in its capacity
as the Fund's distributor, prior to its calculation.
PERFORMANCE INFORMATION
TOTAL RATE OF RETURN: The Fund will calculate its total rate of return for
certain periods by determining the average annual compounded rates of return
over those periods that would cause an investment of $1,000 (made with all
distributions reinvested) to reach the value of that investment at the end of
the periods. The Fund may also calculate total rates of return which represent
aggregate performance over a period or year-by-year performance.
From time to time, the Fund may quote, and compare its performance to, the LSI.
In addition, from time to time the Fund may, as appropriate, quote Fund rankings
or reprint all or a portion of evaluations of fund performance and operations
appearing in various independent publications, including but not limited to the
following: Money, Fortune, U.S. News and World Report, Kiplinger's Personal
Finance, The Wall Street Journal, Barron's, Investors Business Daily, Newsweek,
Financial World, Financial Planning, Investment Advisor, USA Today, Pensions and
Investments, SmartMoney, Forbes, Global Finance, Registered Representative,
Institutional Investor, the Investment Company Institute, Johnson's Charts,
Morningstar, Lipper Analytical Services, Inc., CDA Wiesenberger, Shearson Lehman
and Salomon Bros. Indices, Ibbotson, Business Week, Lowry Associates, Media
General, Investment Company Data, The New York Times, Your Money, Strangers
Investment Advisor, Financial Planning on Wall Street, Standard and Poor's,
Individual Investor, THE 100 BEST MUTUAL FUNDS YOU CAN BUY by Gordon K.
Williamson, Consumer Price Index, and Sanford C. Bernstein & Co. Fund
performance may also be compared to the performance of other mutual funds
tracked by financial or business publications or periodicals. The Fund may also
quote evaluations mentioned in independent radio or television broadcasts and
may use charts and graphs to illustrate the past performance of various indices
such as those mentioned above and illustrations using hypothetical rates of
return to illustrate the effects of compounding and tax-deferral. The Fund may
advertise examples of the effects of periodic investment plans, including the
principle of dollar cost averaging. In such a program, an investor invests a
fixed dollar amount in a fund at periodic intervals, thereby purchasing fewer
shares when prices are high and more shares when prices are low. While such a
strategy does not assure a profit or guard against a loss in a declining market,
the investor's average cost per share can be lower than if fixed numbers of
shares are purchased at the same intervals.
MFS FIRSTS: MFS has a long history of innovations.
-- 1924 -- Massachusetts Investors Trust is established as the first open-end
mutual fund in America.
-- 1924 -- Massachusetts Investors Trust is the first mutual fund to make full
public disclosure of its operations in shareholder reports.
-- 1932 -- One of the first internal research departments is established to
provide in-house analytical capability for an investment management firm.
-- 1933 -- Massachusetts Investors Trust is the first mutual fund to register
under the Securities Act of 1933. ("Truth in Securities Act" or "Full
Disclosure Act".)
-- 1936 -- Massachusetts Investors Trust is the first mutual fund to allow
shareholders to take capital gain distributions either in additional shares
or in cash.
-- 1976 -- MFS Municipal Bond Fund is among the first municipal bond funds
established.
-- 1979 -- Spectrum becomes the first combination fixed/variable annuity with no
initial sales charge.
-- 1981 -- MFS World Governments Fund is established as America's first globally
diversified fixed-income mutual fund.
-- 1984 -- MFS Municipal High Income Fund is the first open-end mutual fund to
seek high tax-free income from lower-rated municipal securities.
-- 1986 -- MFS Managed Sectors Fund becomes the first mutual fund to target and
shift investments among industry sectors for shareholders.
-- 1986 -- MFS Municipal Income Trust is the first closed-end, high-yield
municipal bond fund traded on the New York Stock Exchange.
-- 1987 -- MFS Multimarket Income Trust is the first closed-end, multimarket
high income fund listed on the New York Stock Exchange.
-- 1989 -- MFS Regatta becomes America's first non-qualified
market-value-adjusted fixed/variable annuity.
-- 1990 -- MFS World Total Return Fund is the first global balanced fund.
-- 1993 -- MFS World Growth Fund is the first global emerging markets fund to
offer the expertise of two sub-advisers.
-- 1993 -- MFS becomes money manager of MFS Union Standard Trust, the first
trust to invest in companies deemed to be union-
7
<PAGE>
friendly by an Advisory Board of senior labor officials, senior managers of
companies with significant labor contracts, academics and other national
labor leaders or experts.
8. DISTRIBUTION PLAN
The Trustees have adopted a Distribution Plan for the Fund (the "Distribution
Plan") pursuant to Section 12(b) of the 1940 Act and Rule 12b-1 thereunder (the
"Rule") after having concluded that there is a reasonable likelihood that the
Distribution Plan would benefit the Fund and its shareholders. The Distribution
Plan is designed to promote sales, thereby increasing the net assets of the
Fund. Such an increase may reduce the expense ratio to the extent the Fund's
fixed costs are spread over a larger net asset base. Also, an increase in net
assets may lessen the adverse effects that could result were the Fund required
to liquidate portfolio securities to meet redemptions.
The Distribution Plan provides that the Fund will pay MFD a distribution fee up
to (but not necessarily all of) 0.25% per annum of the Fund's average daily net
assets. Payments under the Distribution Plan have been set for an indefinite
period of time at 0.15% per annum of the Fund's average daily net assets.
The Distribution Plan will remain in effect from year to year only if its
continuance is specifically approved at least annually by vote of both the
Trustees and a majority of the Trustees who are not "interested persons" or
financially interested parties to the Plan ("Distribution Plan Qualified
Trustees"). The Distribution Plan requires that the Fund and MFD each shall
provide to the Trustees, and the Trustees shall review, at least quarterly, a
written report of the amounts expended (and purposes therefor) under such Plan.
The Distribution Plan may be terminated at any time by vote of a majority of the
Distribution Plan Qualified Trustees or by vote of the holders of a majority of
the Fund's shares (as defined in "Investment Restrictions"). Agreements under
the Distribution Plan must be in writing, will be terminated automatically if
assigned, and may be terminated at any time without payment of any penalty, by
vote of a majority of the Distribution Plan Qualified Trustees or by vote of the
holders of a majority of the Fund's shares. The Distribution Plan may not be
amended to increase materially the amount of permitted distribution expenses
without the approval of a majority of the Fund's shares (as defined in
"Investment Restrictions") and may not be materially amended in any case without
a vote of the Trustees and a majority of the Distribution Plan Qualified
Trustees. No Trustee who is not an "interested person" has any financial
interest in the Distribution Plan or in any related agreement.
9. DESCRIPTION OF SHARES, VOTING RIGHTS AND LIABILITIES
The Trust's Declaration of Trust permits the Trustees of the Trust to issue an
unlimited number of full and fractional Shares of Beneficial Interest (without
par value) of one or more separate series and to divide or combine the shares of
any series into a greater or lesser number of shares without thereby changing
the proportionate beneficial interests in that series. The Trustees have
currently authorized shares of the two series, the Research Fund and the Equity
Fund. The Declaration of Trust further authorizes the Trustees to classify or
reclassify any series of shares into one or more classes. The Trustees have no
current intention to classify more than one class of shares. Each share of the
Fund represents an equal proportionate interest in the assets of the Fund. Upon
liquidation of the Fund, shareholders of are entitled to share PRO RATA in the
net assets of the Fund available for distribution to shareholders. The Trust
reserves the right to create and issue additional series or classes of shares,
in which case the shares of each class would participate equally in the
earnings, dividends and assets allocable to that class of the particular series.
Shareholders are entitled to one vote for each share held and may vote in the
election of Trustees and on other matters submitted to meetings of shareholders.
Although Trustees are not elected annually by the shareholders, shareholders
have under certain circumstances the right to remove one or more Trustees in
accordance with the provisions of Section 16(c) of the 1940 Act. No material
amendment may be made to the Declaration of Trust without the affirmative vote
of a majority of the Trust's shares. Shares have no pre-emptive or conversion
rights. Shares are fully paid and non-assessable. The Trust may enter into a
merger or consolidation, or sell all or substantially all of its assets (or all
or substantially all of the assets belonging to any series of the Trust), if
approved by the vote of the holders of two-thirds of the Trust's outstanding
shares voting as a single class, or of the affected series of the Trust, as the
case may be, except that if the Trustees of the Trust recommend such merger,
consolidation or sale, the approval by vote of the holders of a majority of the
Trust's or the affected series' outstanding shares (as defined in "Investment
Restrictions") will be sufficient. The Trust or any series of the Trust may also
be terminated (i) upon liquidation and distribution of its assets, if approved
by the vote of the holders of two-thirds of its outstanding shares, or (ii) by
the Trustees by written notice to the shareholders of the Trust of the affected
series. If not so terminated, the Trust will continue indefinitely.
The Trust is an entity of the type commonly known as a "Massachusetts business
trust." Under Massachusetts law, shareholders of such a trust may, under certain
circumstances, be held personally liable as partners for its obligations.
However, the Declaration of Trust contains an express disclaimer of shareholder
liability for acts or obligations of the Trust and provides for indemnification
and reimbursement of expenses out of Trust property for any shareholder held
personally liable for the obligations of the Trust. The Declaration of Trust
also provides that it shall maintain appropriate insurance (for example,
fidelity bonding and errors and omissions insurance) for the protection of the
Trust, its shareholders, Trustees, officers, employees and agents covering
possible tort or other liabilities. Thus, the risk of a shareholder incurring
financial loss on account of shareholder liability is limited to circumstances
in which both inadequate insurance existed and the Trust itself was unable to
meet its obligations.
The Declaration of Trust further provides that obligations of the Trust are not
binding upon the Trustees individually but only upon the property of the Trust
and that the Trustees will not be liable for any action or failure to act, but
nothing in the Declaration of Trust protects a Trustee against any liability to
which he would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence, or reckless disregard of the duties involved in the conduct of
his office.
10. INDEPENDENT ACCOUNTANTS AND FINANCIAL STATEMENTS
Deloitte & Touche LLP are the Fund's independent certified public accountants.
8
<PAGE>
APPENDIX A
TRUSTEE COMPENSATION TABLE
<TABLE>
<CAPTION>
TOTAL TRUSTEE FEES
TRUSTEE FEES FROM THE FUND
NAME OF TRUSTEE FROM FUND(1) COMPLEX (2)
-------------------------------------------------- ------------ ------------------
<S> <C> <C>
William R. Gutow.................................. $2,500 $3,759
Nelson J. Darling................................. 2,500 3,759
</TABLE>
NOTES:
(1) Estimated, for fiscal year ended September 30, 1996.
(2) For calendar year 1994. All Trustees served as Trustees of 4 funds within
the MFS Fund Complex (having aggregate net assets at December 31, 1994, of
approximately $143 million).
A-1
<PAGE>
INVESTMENT ADVISER
Massachusetts Financial Services Company
500 Boylston Street, Boston, MA 02116
(617) 954-5000
DISTRIBUTOR
MFS Fund Distributors, Inc.
500 Boylston Street, Boston, MA 02116
(617) 954-5000
CUSTODIAN AND DIVIDEND DISBURSING AGENT
State Street Bank and Trust Company
225 Franklin Street, Boston, MA 02110
SHAREHOLDER SERVICING AGENT
MFS Service Center, Inc.
500 Boylston Street, Boston, MA 02116
Toll free: (800) 637-8730
MAILING ADDRESS
P.O. Box 1400, Boston, MA 02104-9985
INDEPENDENT ACCOUNTANTS
Deloitte & Touche LLP
125 Summer Street, Boston, MA 02110
MFS-REGISTERED TRADEMARK- UNION
STANDARD-SM- RESEARCH FUND
500 BOYLSTON STREET
BOSTON, MA 02116
[LOGO]
<PAGE>
<TABLE>
PORTFOLIO OF INVESTMENTS - September 30, 1994
Common Stocks and Warrants - 98.4%
---------------------------------------------------------------------------------------------------------------------
<CAPTION>
Issuer Shares Value
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Aerospace - 6.7%
Allied Signal, Inc. 12,000 $ 409,500
McDonnell Douglas Co. 5,000 577,500
United Technologies Corp. 8,000 501,000
----------
$ 1,488,000
---------------------------------------------------------------------------------------------------------------------
Agricultural Products - 2.0%
Conagra, Inc. 14,000 $ 441,000
---------------------------------------------------------------------------------------------------------------------
Airlines - 1.2%
Northwest Airlines Co., "A"*<F1> 15,000 $ 271,875
---------------------------------------------------------------------------------------------------------------------
Automotive - 8.3%
Automotive Industries Holdings, Inc., "A"*<F1> 4,000 $ 97,000
Cooper Tire & Rubber Co. 10,000 233,750
Ford Motor Co. 20,000 555,000
General Motors Corp. 10,000 468,750
Harley-Davidson, Inc. 18,000 497,250
----------
$ 1,851,750
---------------------------------------------------------------------------------------------------------------------
Banks and Credit Companies - 2.7%
Citicorp 8,000 $ 340,000
Firstar Corp. 8,000 248,000
----------
$ 588,000
---------------------------------------------------------------------------------------------------------------------
Business Machines - 2.9%
Xerox Corp. 6,000 $ 640,500
---------------------------------------------------------------------------------------------------------------------
Chemicals - 12.6%
du Pont (E.I.) de Nemours & Co. 10,000 $ 580,000
Hercules, Inc. 4,000 411,500
Monsanto Corp. 8,000 643,000
Rohm & Haas Co. 8,000 457,000
Sterling Chemicals, Inc.*<F1> 12,000 162,000
Union Carbide Corp. 16,000 544,000
----------
$ 2,797,500
---------------------------------------------------------------------------------------------------------------------
Consumer Goods and Services - 5.5%
American Greetings Corp., "A" 10,000 $ 288,750
Brunswick Corp. 7,500 150,938
Revco D.S., Inc.*<F1> 26,100 544,836
Sara Lee Corp. 10,000 225,000
----------
$ 1,209,524
---------------------------------------------------------------------------------------------------------------------
Electrical Equipment - 2.4%
General Electric Co. 11,000 $ 529,375
---------------------------------------------------------------------------------------------------------------------
Entertainment - 4.3%
Circus Circus Enterprises, Inc.*<F1> 10,000 $ 222,500
Disney (Walt) Co. 10,000 388,750
Promus Cos., Inc.*<F1> 10,000 336,250
----------
$ 947,500
---------------------------------------------------------------------------------------------------------------------
Forest and Paper Products - 7.2%
Georgia-Pacific Corp. 4,000 $ 306,000
Mead Corp. 7,000 364,000
Scott Paper Co. 8,000 489,000
Temple Inland, Inc. 8,000 442,000
----------
$ 1,601,000
---------------------------------------------------------------------------------------------------------------------
<PAGE>
PORTFOLIO OF INVESTMENTS - continued
Common Stocks and Warrants - continued
---------------------------------------------------------------------------------------------------------------------
Issuer Shares Value
---------------------------------------------------------------------------------------------------------------------
Machinery - 5.5%
Caterpillar, Inc. 10,000 $ 541,250
Deere & Co., Inc. 10,000 686,250
----------
$ 1,227,500
---------------------------------------------------------------------------------------------------------------------
Medical and Health Products - 2.4%
Johnson & Johnson 5,000 $ 258,125
Merck & Co., Inc. 7,500 266,250
----------
$ 524,375
---------------------------------------------------------------------------------------------------------------------
Metals and Minerals - 5.6%
Allegheny Ludlum Corp. 15,000 $ 322,500
Inland Steel Industries, Inc.*<F1> 7,500 295,313
Phelps Dodge Corp. 10,000 621,250
----------
$ 1,239,063
---------------------------------------------------------------------------------------------------------------------
Oils - 4.7%
Chevron Corp. 10,000 $ 416,250
Mobil Corp. 8,000 633,000
----------
$ 1,049,250
---------------------------------------------------------------------------------------------------------------------
Pollution Control - 2.8%
Browning-Ferris Industries, Inc. 10,000 $ 317,500
USA Waste Services, Inc.*<F1> 20,000 300,000
----------
$ 617,500
---------------------------------------------------------------------------------------------------------------------
Printing and Publishing - 1.1%
Times Mirror Co., "A" 8,000 $ 246,000
---------------------------------------------------------------------------------------------------------------------
Railroads - 4.8%
CSX Corp. 6,000 $ 411,000
Southern Pacific Rail Corp.*<F1> 20,000 375,000
Union Pacific Corp. 5,000 268,125
----------
$ 1,054,125
---------------------------------------------------------------------------------------------------------------------
Special Products and Services - 1.1%
Stanley Works 6,000 $ 243,750
---------------------------------------------------------------------------------------------------------------------
Stores - 2.8%
Federated Department Stores, Inc.*<F1> 10,000 $ 230,000
May Department Stores Co. 10,000 393,750
----------
$ 623,750
---------------------------------------------------------------------------------------------------------------------
Supermarkets - 1.7%
Stop & Shop Cos., Inc.*<F1> 15,000 $ 376,875
---------------------------------------------------------------------------------------------------------------------
Utilities - Electric - 2.2%
CMS Energy Corp. 12,000 $ 261,000
DPL, Inc. 6,000 117,000
Illinova Corp. 6,000 115,500
----------
$ 493,500
---------------------------------------------------------------------------------------------------------------------
Utilities - Gas - 2.8%
Tenneco, Inc. 14,000 $ 617,750
---------------------------------------------------------------------------------------------------------------------
Utilities - Telephone - 5.1%
American Telephone & Telegraph Co. 4,500 $ 243,000
BellSouth Corp. 6,000 334,500
GTE Corp. 2,800 85,050
<PAGE>
PORTFOLIO OF INVESTMENTS - continued
Common Stocks and Warrants - continued
---------------------------------------------------------------------------------------------------------------------
Issuer Shares Value
---------------------------------------------------------------------------------------------------------------------
Utilities - Telephone - continued
Southwestern Bell Corp. 3,500 $ 148,750
Sprint Corp. 4,000 152,500
US West, Inc. 4,500 174,375
----------
$ 1,138,175
---------------------------------------------------------------------------------------------------------------------
Total Common Stocks and Warrants (Identified Cost, $21,830,603) $21,817,637
---------------------------------------------------------------------------------------------------------------------
Short-Term Obligations - 2.8%
---------------------------------------------------------------------------------------------------------------------
Principal Amount
(000 Omitted)
---------------------------------------------------------------------------------------------------------------------
Federal Home Loan Bank, 4.68s, due 10/07/94 $ 300 $ 299,766
Federal Home Loan Mortgage Corp., 4.63s, due 10/03/94 325 324,914
---------------------------------------------------------------------------------------------------------------------
Total Short-Term Obligations, at Amortized Cost $ 624,680
---------------------------------------------------------------------------------------------------------------------
Total Investments (Identified Cost, $22,455,283) $22,442,317
Other Assets, Less Liabilities - (1.2)% (257,869)
---------------------------------------------------------------------------------------------------------------------
Net Assets - 100.0% $22,184,448
---------------------------------------------------------------------------------------------------------------------
<FN>
------------
<F1>* Non-income producing security.
See notes to financial statements
</TABLE>
<PAGE>
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
--------------------------------------------------------------------------------
September 30, 1994
--------------------------------------------------------------------------------
Assets:
Investments, at value (identified cost, $22,455,283) $ 22,442,317
Receivable for investments sold 423,341
Receivable for Fund shares sold 1,000
Dividends receivable 34,117
Receivable from investment adviser 26,747
Deferred organization expenses 21,569
------------
Total assets $ 22,949,091
------------
Liabilities:
Payable for investments purchased $ 739,862
Payable to affiliates -
Management fee 399
Shareholder servicing agent fee 67
Distribution fee 92
Accrued expenses and other liabilities 24,223
------------
Total liabilities $ 764,643
------------
Net assets $ 22,184,448
------------
Net assets consist of:
Paid-in capital $ 22,214,811
Unrealized depreciation on investments (12,966)
Accumulated net realized loss on investments (170,743)
Accumulated undistributed net investment income 153,346
------------
Total $ 22,184,448
------------
Shares of beneficial interest outstanding 2,301,171
------------
Net asset value, offering price and redemption price per share
(net assets of $22,184,448 / 2,301,171 shares of beneficial
interest outstanding) $ 9.64
------------
See notes to financial statements
<PAGE>
FINANCIAL STATEMENTS - continued
Statement of Operations
--------------------------------------------------------------------------------
Period Ended September 30, 1994*
--------------------------------------------------------------------------------
Net investment income:
Income -
Dividends $ 219,230
Interest 33,440
----------
Total investment income $ 252,670
----------
Expenses -
Management fee $ 64,457
Trustees' compensation 3,900
Shareholder servicing agent fee 67
Distribution and service fee 14,882
Auditing fees 33,300
Printing 12,476
Legal fees 4,773
Custodian fee 1,440
Postage 200
Amortization of organization expenses 3,471
Miscellaneous 23,029
----------
Total expenses $ 161,995
Reduction of expenses by investment adviser (62,671)
----------
Net expenses $ 99,324
----------
Net investment income $ 153,346
----------
Realized and unrealized loss on investments:
Realized loss (identified cost basis) on investment transactions $ (170,743)
Change in unrealized depreciation on investments (12,966)
----------
Net realized and unrealized loss on investments $ (183,709)
----------
Decrease in net assets from operations $ (30,363)
----------
----------
*For the period from the commencement of investment operations, January 14, 1994
to September 30, 1994.
See notes to financial statements
<PAGE>
FINANCIAL STATEMENTS - continued
Statement of Changes in Net Assets
--------------------------------------------------------------------------------
Period Ended September 30, 1994*
--------------------------------------------------------------------------------
Increase (decrease) in net assets:
From operations -
Net investment income $ 153,346
Net realized loss on investments (170,743)
Net unrealized loss on investments (12,966)
------------
Decrease in net assets from operations $ (30,363)
------------
Fund share transactions -
Net proceeds from sale of shares $ 22,212,350
Cost of shares reacquired (47,539)
------------
Increase in net assets from Fund share transactions $ 22,164,811
------------
Total increase in net assets $ 22,134,448
Net assets:
At beginning of period 50,000
------------
At end of period (including accumulated undistributed net
investment income of $153,346) $ 22,184,448
------------
----------
*For the period from the commencement of investment operations, January 14, 1994
to September 30, 1994.
Financial Highlights
--------------------------------------------------------------------------------
Period Ended September 30, 1994*
--------------------------------------------------------------------------------
Per share data (for a share outstanding throughout each period):
Net asset value - beginning of period $ 10.00
------
Income from investment operations# -
Net investment income++ $ 0.12
Net realized and unrealized loss on investments## (0.48)
------
Total from investment operations $ (0.36)
------
Net asset value - end of period $ 9.64
------
Total return (3.60)%
Ratios (to average net assets)/Supplemental data++:
Expenses 1.00%<F4>
Net investment income 1.55%<F4>
Portfolio turnover 48%
Net assets at end of period (000 omitted) $22,184
----------
* For the period from the commencement of investment operations, January 14,
1994 to September 30, 1994.
# Per share data is based on average shares outstanding for the period.
## The per share amount is not in accord with the net realized and unrealized
gain for the period because of the timing of sales of Fund shares and the
amount of per share realized and unrealized gains and losses at such time.
+ Annualized.
++ The investment adviser voluntarily agreed to maintain the expenses of the
Fund at not more than 1.00% of average daily net assets. To the extent
actual expenses were over this limitation, the net investment income per
share and the ratios would have been:
Net investment income $ 0.07
Ratios (to average net assets):
Expenses 1.64%+
Net investment income 0.91%+
See notes to financial statements
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(1) Business and Organization
MFS Union Standard Equity Fund (the Fund) is a diversified series of MFS Union
Standard Trust (the Trust). The Trust is organized as a Massachusetts business
trust and is registered under the Investment Company Act of 1940, as amended, as
an open-end management investment company.
(2) Significant Accounting Policies
Investment Valuations - Equity securities listed on securities exchanges or
reported through the NASDAQ system are valued at last sale prices. Unlisted
equity securities or listed equity securities for which last sale prices are not
available are valued at last quoted bid prices. Short-term obligations, which
mature in 60 days or less, are valued at amortized cost, which approximates
value. Securities for which there are no such quotations or valuations are
valued at fair value as determined in good faith by or at the direction of the
Trustees.
Deferred Organization Expenses - Costs incurred by the Fund in connection with
its organization have been deferred and are being amortized on a straight-line
basis over a five-year period beginning on the date of commencement of
operations of the Fund.
Investment Transactions and Income - Investment transactions are recorded on the
trade date. Interest income is recorded on the accrual basis. Dividend income is
recorded on the ex-dividend date for dividends received in cash. Dividend
payments received in additional securities are recorded on the ex- dividend date
in an amount equal to the value of the security on such date.
Tax Matters and Distributions - The Fund's policy is to comply with the
provisions of the Internal Revenue Code (the Code) applicable to regulated
investment companies and to distribute to shareholders all of its net income,
including any net realized gain on investments. Accordingly, no provision for
federal income or excise tax is provided. The Fund files a tax return annually
using tax accounting methods required under provisions of the Code which may
differ from generally accepted accounting principles, the basis on which these
financial statements are prepared. Accordingly, the amount of net investment
income and net realized gain reported on these financial statements may differ
from that reported on the Fund's tax return, and consequently, the character of
distributions to shareholders reported in the financial highlights may differ
from that reported to shareholders on Form 1099-DIV. Distributions to
shareholders are recorded on the ex-dividend date.
The Fund distinguishes between distributions on a tax basis and a financial
reporting basis and requires that only distributions in excess of tax basis
earnings and profits are reported in the financial statements as a return of
capital. Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes, are classified as
distributions in excess of net investment income or accumulated net realized
gains.
(3) Transactions with Affiliates
Investment Adviser - The Fund has an investment advisory agreement with
Massachusetts Financial Services Company (MFS) to provide overall investment
advisory and administrative services, and general office facilities. The
management fee, computed daily and paid monthly at an annual rate of 0.65% of
average daily net assets, amounted to $64,457 for the period from January 14,
1994 (commencement of investment operations) to September 30, 1994. MFS has
agreed to pay until December 31, 1998, expenses of the Fund such that the Fund's
aggregate operating expenses shall not exceed, on an annualized basis, 1.00% of
the average daily net assets of the Fund. Such payments by MFS are subject to
reimbursement by the Fund, which will be accomplished by the payment by the Fund
of an expense reimbursement fee to MFS computed and paid monthly at a percentage
of its average daily net assets for its then current fiscal year, with a
limitation that immediately after such payment, the aggregate operating expenses
of the Fund will not exceed, on an annualized basis, 1.00% of its average daily
net assets. This expense reimbursement agreement terminates for the Fund on the
earlier of the date on which payments made thereunder by the Fund equal the
prior payments of such reimbursable expenses by MFS or December 31, 1998. For
the period ended September 30, 1994, expenses subject to reimbursement by the
Fund to MFS were $62,671.
<PAGE>
NOTES TO FINANCIAL STATEMENTS - continued
The Fund pays no compensation directly to its Trustees who are officers of the
investment adviser, or to officers of the Fund, all of whom receive remuneration
for their services to the Fund from MFS. Certain of the officers and Trustees of
the Fund are officers or directors of MFS, MFS Investor Services, Inc. (ISI) and
MFS Service Center, Inc. (MFSC).
Distributor - ISI, a wholly owned subsidiary of MFS, is distributor for the
Fund. The Trustees have adopted a distribution plan pursuant to Rule 12b-1 of
the Investment Company Act of 1940. The distribution plan provides that the Fund
will pay ISI up to 0.25% per annum of the Fund's average daily net assets in
order that ISI may pay expenses on behalf of the Fund related to the
distribution and servicing of its shares. Payments under the distribution plan
have been set at 0.15% of average daily net assets for an indefinite period of
time. Fees incurred under the distribution plan during the period ended
September 30, 1994 amounted to $14,882.
Shareholder Servicing Agent - MFSC, a wholly owned subsidiary of MFS, earned $67
for the period ended September 30, 1994. The fee is calculated based on the
number of shareholder accounts which the Fund has had maintained for the period.
(4) Portfolio Securities
Purchases and sales of investments, other than U.S. government securities,
purchased option transactions and short-term obligations, aggregated $28,549,441
and $6,500,438, respectively.
The cost and unrealized appreciation or depreciation in value of the investments
owned by the Fund, as computed on a federal income tax basis, are as follows:
Aggregate cost $22,461,264
----------
Gross unrealized depreciaton $(1,033,994)
Gross unrealized appreciation 1,015,047
----------
Net unrealized depreciation $ (18,947)
----------
At September 30, 1994, the Fund, for federal income tax purposes, had a capital
loss carry-forward of $164,762, which may be applied against any net taxable
realized gains of each succeeding year until the earlier of its utilization or
expiration on September 30, 2002.
(5) Shares of Beneficial Interest
The Fund's Declaration of Trust permits the Trustees to issue an unlimited
number of full and fractional shares of beneficial interest (without par value).
Transactions in Fund shares were as follows:
Period Ended
September 30, 1994*
---------------------------
Shares Amount
---------------------------------------------------------------------------
Shares sold 2,301,136 $22,212,350
Shares reacquired (4,965) (47,539)
-------- ----------
Net increase 2,296,171 $22,164,811
-------- ----------
-------- ----------
----------
* For the period from January 14, 1994 (commencement of investment operations)
to September 30, 1994.
<PAGE>
NOTES TO FINANCIAL STATEMENTS - continued
(6) Financial Instruments
The Fund may trade financial instruments with off-balance sheet risk in the
normal course of its investing activities in order to manage exposure to market
risks such as interest rates. These financial instruments include written
options and futures contracts. The notional or contractual amounts of these
instruments represent the investment the Fund has in particular classes of
financial instruments and does not necessarily represent the amounts potentially
subject to risk. The measurement of the risks associated with these instruments
is meaningful only when all related and offsetting transactions are considered.
No such financial instruments were held by the Fund at September 30, 1994.
----------------------------------
INDEPENDENT AUDITORS' REPORT
To the Trustees of MFS Union Standard Trust and Shareholders of MFS Union
Standard Equity Fund:
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of MFS Union Standard Equity Fund (one of the
series constituting MFS Union Standard Trust) as of September 30, 1994, and the
related statement of operations, statement of changes in net assets, and
financial highlights for the period from January 14, 1994 (the commencement of
investment operations) through September 30, 1994. These financial statements
and financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and financial highlights are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of the securities owned at September 30, 1994
by correspondence with the custodian and brokers; where replies were not
received from brokers, we performed other auditing procedures. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of MFS Union Standard
Equity Fund at September 30, 1994, the results of its operations, the changes in
its net assets, and its financial highlights for the stated period in conformity
with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
November 4, 1994
----------------------------------
This report is prepared for the general information of shareholders. It is
authorized for distribution to prospective investors only when preceded or
accompanied by a current prospectus.
<PAGE>
PART C
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
(a) FINANCIAL STATEMENTS ON BEHALF OF MFS UNION STANDARD RESEARCH FUND
Included in Part A of this Registration Statement:
None
Included in Part B of this Registration Statement:
None
(b) EXHIBITS ON BEHALF OF MFS UNION STANDARD RESEARCH FUND
1 (a) Declaration of Trust dated September 1, 1993; filed
herewith.
(b) Amendment to Declaration of Trust-Designation of Series
dated September 1, 1993; filed herewith.
(c) Amendment to Declaration of Trust - Abolishment of MFS Union
Standard Fixed Income Fund, a series of Shares of Beneficial
Interest and Establishment and Designation of MFS Union
Standard Research Fund, a series of Shares of Beneficial
Interest, dated August 29, 1995; filed herewith.
2 By-Laws, dated September 1, 1993; filed herewith.
3 Not Applicable.
4 Form of Share Certificate. (4)
5 (a) Investment Advisory Agreement by and between MFS Union
Standard Trust on behalf of MFS Union Standard Equity Fund
and Massachusetts Financial Services Company dated December
8, 1993; filed herewith.
(b) Form of Investment Advisory Agreement by and between MFS
Union Standard Trust on behalf of MFS Union Standard
Research Fund and Massachusetts Financial Services Company
dated November 15, 1995; filed herewith.
6 Distribution Agreement dated December 8, 1993; filed
herewith.
7 Not Applicable.
<PAGE>
8 (a) Custodian Agreement between Registrant and State Street Bank
and Trust Company dated December 8, 1993. (1)
(b) Amendment to the Custodian Agreement dated December 8, 1993;
filed herewith.
(c) Form of Amendment to Custodian Contract dated November 15,
1995; filed herewith.
9 (a) Form of Amended and Restated Shareholder Servicing Agent
Agreement between Registrant and MFS Service Center dated
November 15, 1995; filed herewith.
(b) Proxy Services Agreement between Massachusetts Financial
Services Company and American Capital Strategies Ltd., dated
December 8, 1993. (1)
(c) Dividend Disbursing Agency Agreement between Registrant and
State Street Bank and Trust Company dated December 8, 1993;
filed herewith.
10 24f-2 Opinion and Consent of Counsel was filed with the
Securities and Exchange Commission on November 29, 1994.
11 Consent of Deloitte & Touche for MFS Union Standard Equity
Fund. (2).
12 Not Applicable.
13 Investment Representation Letter dated November 19, 1993;
filed herewith.
14 Not Applicable.
15 (a) Distribution Plan for MFS Union Standard Equity Fund dated
December 8, 1993; filed herewith.
(b) Form of Distribution Plan for MFS Union Standard Research
Fund dated November 15, 1995; filed herewith.
16 Schedule of Computation for Performance Quotations - Total
Return. (3)
17 Not Applicable.
<PAGE>
18 Not Applicable.
Power of Attorney dated August 12, 1994; filed herewith.
-------------------------
(1) Incorporated by reference to Registrant's Post-Effective Amendment No. 1
filed with the SEC on July 14, 1994.
(2) Incorporated by reference to Registrant's Post-Effective Amendment No. 2
filed with the SEC on November 29, 1994.
(3) Incorporated by reference to MFS Municipal Series Trust (File Nos. 2-92915
and 811-4096) Post-Effective Amendment No. 26 filed with the SEC on
February 22, 1995.
(4) Incorporated by reference to MFS Municipal Series Trust (File Nos. 2-92915
and 811-4096) Post-Effective Amendment No. 28 filed with the SEC on July
28, 1995.
ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
Not applicable.
ITEM 26. NUMBER OF HOLDERS OF SECURITIES
MFS UNION STANDARD EQUITY FUND
(1) (2)
TITLE OF CLASS NUMBER OF RECORD HOLDERS
Shares of Beneficial Interest 19
(without part value) (as of August 30, 1995)
MFS UNION STANDARD RESEARCH FUND
(1) (2)
TITLE OF CLASS NUMBER OF RECORD HOLDERS
Shares of Beneficial Interest 0
(without part value) (as of August 30, 1995)
ITEM 27. INDEMNIFICATION
Section 5.3 of the Registrant's Declaration of Trust provides that
every person who is or has been a Trustee or officer of the Registrant shall be
indemnified by the Registrant 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. However, Section 5.3 further provides that no
indemnification shall be provided to a Trustee or officer:
(i) against any liability to the Registrant or the shareholders of
the Registrant by reason of a final adjudication by the court or
other body before which
<PAGE>
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
Registrant; or
(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 (i) or (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 (as
defined below) 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.
The term "Disinterested Trustee" is defined as one who is not an
interested person of the Registrant and 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.
Expenses of preparation and presentation of a defense to any claim,
action, suit, or proceeding of the character described in Section 5.3 of the
Registrant's Declaration of Trust shall be advanced by the Registrant 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 Section 5.3, provided that either:
(i) such undertaking is secured by a surety bond or some other
appropriate security or the Registrant 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.
<PAGE>
Section 9 of the Shareholder Servicing Agent Agreement between the
Registrant and MFS Service Center, Inc. ("MFSC") specifies that the Registrant
will indemnify MFSC against and hold MFSC harmless from any and all losses,
claims, damages, liabilities or expenses (including reasonable counsel fees and
expenses) resulting from any claim, demand, action or suit not resulting from
MFSC's bad faith or negligence, and arising out of, or in connection with,
MFSC's duties on behalf of the Registrant under such Agreement. In addition,
Section 9 provides that the Registrant will indemnify MFSC against and hold MFSC
harmless from any and all losses, claims, damages, liabilities or expenses
(including reasonable counsel fees and expenses) resulting from any claim,
demand, action or suit as a result of MFSC acting in accordance with any
instructions reasonably believed by MFSC to have been executed or orally
communicated by any person duly authorized by the Registrant or its principal
underwriter, or as a result of acting in accordance with written or oral advice
reasonably believed by MFSC to have been given by counsel for the Registrant, or
as a result of acting in accordance with any instrument or share certificate
reasonably believed by MFSC to have been genuine and signed, countersigned or
executed by any person or persons authorized to sign, countersign or execute the
same (unless contributed to by MFSC's gross negligence or bad faith).
The Trustees and officers of the Registrant and the personnel of the
Registrant's investment adviser and distributor will be insured as of the
effective date of this Registration Statement under an errors and omissions
liability insurance policy. The Registrant and its officers are also insured
under the fidelity bond required by Rule 17g-1 under the Investment Company Act
of 1940, as amended.
ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
MFS serves as investment adviser to the following open-end Funds
comprising the MFS Family of Funds: Massachusetts Investors Trust,
Massachusetts Investors Growth Stock Fund, MFS Growth Opportunities Fund, MFS
Government Securities Fund, MFS Government Limited Maturity Fund, MFS Series
Trust I (which has three series: MFS Managed Sectors Fund, MFS Cash Reserve Fund
and MFS World Asset Allocation Fund), MFS Series Trust II (which has four
series: MFS Emerging Growth Fund, MFS Capital Growth Fund, MFS Intermediate
Income Fund and MFS Gold & Natural Resources Fund), MFS Series Trust III (which
has two series: MFS High Income Fund and MFS Municipal High Income Fund), MFS
Series Trust IV (which has four series: MFS Money Market Fund, MFS Government
Money Market Fund, MFS Municipal Bond Fund and MFS OTC Fund), MFS Series Trust V
(which has two series: MFS Total Return Fund and MFS Research Fund), MFS Series
Trust VI (which has three series: MFS World Total Return Fund, MFS Utilities
Fund and MFS World Equity Fund), MFS Series Trust VII (which has two series: MFS
World Governments Fund and MFS Value Fund), MFS Series Trust VIII (which has two
series: MFS Strategic Income Fund and MFS World Growth Fund), MFS Series Trust
IX (which has three series: MFS Bond Fund, MFS Limited Maturity Fund and MFS
Municipal Limited Maturity Fund), MFS Series Trust X (which has four series:
MFS Government Mortgage Fund, MFS/Foreign & Colonial Emerging Markets Equity
Fund, MFS/Foreign and Colonial International Growth Fund and MFS/Foreign and
Colonial International Growth & Income Fund), and MFS Municipal Series Trust
(which has 19
<PAGE>
series: MFS Alabama Municipal Bond Fund, MFS Arkansas Municipal Bond Fund, MFS
California Municipal Bond Fund, MFS Florida Municipal Bond Fund, MFS Georgia
Municipal Bond Fund, MFS Louisiana 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 Texas Municipal Bond Fund, MFS Virginia
Municipal Bond Fund, MFS Washington Municipal Bond Fund, MFS West Virginia
Municipal Bond Fund and MFS Municipal Income Fund) (the "MFS Funds"). The
principal business address of each of the aforementioned Funds is 500 Boylston
Street, Boston, Massachusetts 02116.
MFS also serves as investment adviser of the following no-load, open-
end Funds: MFS Institutional Trust ("MFSIT") (which has seven series), MFS
Variable Insurance Trust ("MVI") (which has twelve series) and MFS Union
Standard Trust ("UST") (which has two series). The principal business address
of each of the aforementioned Funds is 500 Boylston Street, Boston,
Massachusetts 02116.
In addition, MFS serves as investment adviser to the following closed-
end Funds: MFS Municipal Income Trust, MFS Multimarket Income Trust, MFS
Government Markets Income Trust, MFS Intermediate Income Trust, MFS Charter
Income Trust and MFS Special Value Trust (the "MFS Closed-End Funds"). The
principal business address of each of the aforementioned Funds is 500 Boylston
Street, Boston, Massachusetts 02116.
Lastly, MFS serves as investment adviser to MFS/Sun Life Series Trust
("MFS/SL"), Sun Growth Variable Annuity Funds, Inc. ("SGVAF"), Money Market
Variable Account, High Yield Variable Account, Capital Appreciation Variable
Account, Government Securities Variable Account, World Governments Variable
Account, Total Return Variable Account and Managed Sectors Variable Account.
The principal business address of each is One Sun Life Executive Park, Wellesley
Hills, Massachusetts 02181.
MFS International Ltd. ("MIL"), a limited liability company organized
under the laws of the Republic of Ireland and a subsidiary of MFS, whose
principal business address is 41-45 St. Stephen's Green, Dublin 2, Ireland,
serves as investment adviser to and distributor for MFS International Fund
(which has four portfolios: MFS International Funds-U.S. Equity Fund, MFS
International Funds-U.S. Emerging Growth Fund, MFS International Funds-
International Government Fund and MFS International Funds-Charter Income Fund)
(the "MIL Funds"). The MIL Funds are organized in Luxembourg and qualify as an
undertaking for collective investments in transferable securities (UCITS). The
principal business address of the MIL Funds is 47, Boulevard Royal, L-2449
Luxembourg.
MIL also serves as investment adviser to and distributor for MFS
Meridian U.S. Government Bond Fund, MFS Meridian Charter Income Fund, MFS
Meridian Global Government Fund, MFS Meridian U.S. Emerging Growth Fund, MFS
Meridian Global Equity Fund, MFS Meridian Limited Maturity Fund, MFS Meridian
World Growth Fund, MFS Meridian Money Market Fund, MFS Meridian World Total
Return Fund and MFS Meridian U.S.
<PAGE>
Equity Fund (collectively the "MFS Meridian Funds"). Each of the MFS Meridian
Funds is organized as an exempt company under the laws of the Cayman Islands.
The principal business address of each of the MFS Meridian Funds is P.O. Box
309, Grand Cayman, Cayman Islands, British West Indies.
MFS International (U.K.) Ltd. ("MIL-UK"), a private limited company
registered with the Registrar of Companies for England and Wales whose current
address is 4 John Carpenter Street, London, England ED4Y 0NH, is involved
primarily in marketing and investment research activities with respect to
private clients and the MIL Funds and the MFS Meridian Funds.
MFS Fund Distributors, Inc. ("MFD"), a wholly owned subsidiary of MFS,
serves as distributor for the MFS Funds, MVI, UST and MFSIT.
Clarendon Insurance Agency, Inc. ("CIAI"), a wholly owned subsidiary
of MFS, serves as distributor for certain life insurance and annuity contracts
issued by Sun Life Assurance Company of Canada (U.S.).
MFS Service Center, Inc. ("MFSC"), a wholly owned subsidiary of MFS,
serves as shareholder servicing agent to the MFS Funds, the MFS Closed-End
Funds, MFSIT, MVI and UST.
MFS Asset Management, Inc. ("AMI"), a wholly owned subsidiary of MFS,
provides investment advice to substantial private clients.
MFS Retirement Services, Inc. ("RSI"), a wholly owned subsidiary of
MFS, markets MFS products to retirement plans and provides administrative and
record keeping services for retirement plans.
MFS
The Directors of MFS are A. Keith Brodkin, Jeffrey L. Shames, Arnold
D. Scott, John R. Gardner and John D. McNeil. Mr. Brodkin is the Chairman, Mr.
Shames is the President, Mr. Scott is a Senior Executive Vice President and
Secretary, Bruce C. Avery, William S. Harris, William W. Scott, Jr., and
Patricia A. Zlotin are Executive Vice Presidents, James E. Russell is a Senior
Vice President and the Treasurer, Stephen E. Cavan is a Senior Vice President,
General Counsel and an Assistant Secretary, Joseph W. Dello Russo is a Senior
Vice President and Chief Financial Officer, Robert T. Burns is a Vice President
and an Assistant Secretary of MFS, and Mary Kay Doherty is a Vice President and
Assistant Treasurer.
<PAGE>
MASSACHUSETTS INVESTORS TRUST
MASSACHUSETTS INVESTORS GROWTH STOCK FUND
MFS GROWTH OPPORTUNITIES FUND
MFS GOVERNMENT SECURITIES FUND
MFS SERIES TRUST I
MFS SERIES TRUST V
MFS SERIES TRUST VI
MFS SERIES TRUST X
MFS GOVERNMENT LIMITED MATURITY FUND
A. Keith Brodkin is the Chairman and President, Stephen E. Cavan is
the Secretary, W. Thomas London is the Treasurer, James O. Yost, Vice President
of MFS, is the Assistant Treasurer, James R. Bordewick, Jr., Vice President and
Associate General Counsel of MFS, is the Assistant Secretary.
MFS SERIES TRUST II
A. Keith Brodkin is the Chairman and President, Leslie J. Nanberg,
Senior Vice President of MFS, is a Vice President, Stephen E. Cavan is the
Secretary, W. Thomas London is the Treasurer, James O. Yost is the Assistant
Treasurer, and James R. Bordewick, Jr., is the Assistant Secretary.
MFS GOVERNMENT MARKETS INCOME TRUST
MFS INTERMEDIATE INCOME TRUST
A. Keith Brodkin is the Chairman and President, Patricia A. Zlotin,
Executive Vice President of MFS and Leslie J. Nanberg, Senior Vice President of
MFS, are Vice Presidents, Stephen E. Cavan is the Secretary, W. Thomas London is
the Treasurer, James O. Yost is the Assistant Treasurer, and James R. Bordewick,
Jr., is the Assistant Secretary.
MFS SERIES TRUST III
A. Keith Brodkin is the Chairman and President, James T. Swanson,
Robert J. Manning, Cynthia M. Brown and Joan S. Batchelder, Senior Vice
Presidents of MFS, Bernard Scozzafava, Vice President of MFS, and Matthew
Fontaine, Assistant Vice President of MFS, are Vice Presidents, Sheila Burns-
Magnan and Daniel E. McManus, Assistant Vice Presidents of MFS, are Assistant
Vice Presidents, Stephen E. Cavan is the Secretary, W. Thomas London is the
Treasurer, James O. Yost is the Assistant Treasurer, and James R. Bordewick,
Jr., is the Assistant Secretary.
MFS SERIES TRUST IV
MFS SERIES TRUST IX
A. Keith Brodkin is the Chairman and President, Robert A. Dennis and
Geoffrey L. Kurinsky, Senior Vice Presidents of MFS, are Vice Presidents,
Stephen E. Cavan is the
<PAGE>
Secretary, W. Thomas London is the Treasurer, James O. Yost is the Assistant
Treasurer and James R. Bordewick, Jr., is the Assistant Secretary.
MFS SERIES TRUST VII
A. Keith Brodkin is the Chairman and President, Leslie J. Nanberg and
Stephen C. Bryant, Senior Vice Presidents of MFS, are Vice Presidents, Stephen
E. Cavan is the Secretary, W. Thomas London is the Treasurer, James O. Yost is
the Assistant Treasurer and James R. Bordewick, Jr., is the Assistant Secretary.
MFS SERIES TRUST VIII
A. Keith Brodkin is the Chairman and President, Jeffrey L. Shames,
Leslie J. Nanberg, Patricia A. Zlotin, James T. Swanson and John D. Laupheimer,
Jr., Vice President of MFS, are Vice Presidents, Stephen E. Cavan is the
Secretary, W. Thomas London is the Treasurer, James O. Yost is the Assistant
Treasurer and James R. Bordewick, Jr., is the Assistant Secretary.
MFS MUNICIPAL SERIES TRUST
A. Keith Brodkin is the Chairman and President, Cynthia M. Brown and
Robert A. Dennis are Vice Presidents, David B. Smith, Geoffrey L. Schechter and
David R. King, Vice Presidents of MFS, are Vice Presidents, Stephen E. Cavan is
the Secretary, W. Thomas London is the Treasurer, James O. Yost is the Assistant
Treasurer and James R. Bordewick, Jr., is the Assistant Secretary.
MFS VARIABLE INSURANCE TRUST
MFS UNION STANDARD TRUST
MFS INSTITUTIONAL TRUST
A. Keith Brodkin is the Chairman and President, Stephen E. Cavan is
the Secretary, W. Thomas London is the Treasurer, James O. Yost is the Assistant
Treasurer and James R. Bordewick, Jr., is the Assistant Secretary.
MFS MUNICIPAL INCOME TRUST
A. Keith Brodkin is the Chairman and President, Cynthia M. Brown and
Robert J. Manning are Vice Presidents, Stephen E. Cavan is the Secretary, W.
Thomas London is the Treasurer, James O. Yost, is the Assistant Treasurer and
James R. Bordewick, Jr., is the Assistant Secretary.
<PAGE>
MFS MULTIMARKET INCOME TRUST
MFS CHARTER INCOME TRUST
A. Keith Brodkin is the Chairman and President, Patricia A. Zlotin,
Leslie J. Nanberg and James T. Swanson are Vice Presidents, Stephen E. Cavan is
the Secretary, W. Thomas London is the Treasurer, James O. Yost, Vice President
of MFS, is the Assistant Treasurer and James R. Bordewick, Jr., is the Assistant
Secretary.
MFS SPECIAL VALUE TRUST
A. Keith Brodkin is the Chairman and President, Jeffrey L. Shames,
Patricia A. Zlotin and Robert J. Manning are Vice Presidents, Stephen E. Cavan
is the Secretary, W. Thomas London is the Treasurer, and James O. Yost, is the
Assistant Treasurer and James R. Bordewick, Jr., is the Assistant Secretary.
SGVAF
W. Thomas London is the Treasurer.
MIL
A. Keith Brodkin is a Director and the Chairman, Arnold D. Scott and
Jeffrey L. Shames are Directors, Ziad Malek, Senior Vice President of MFS, is
the President, Thomas J. Cashman, Jr., a Senior Vice President of MFS, is a
Senior Vice President, Stephen E. Cavan is a Director, Senior Vice President and
the Clerk, James R. Bordewick, Jr. is a Director, Vice President and an
Assistant Clerk, Robert T. Burns is an Assistant Clerk, Joseph W. Dello Russo is
the Treasurer and James E. Russell is the Assistant Treasurer.
MIL-UK
A. Keith Brodkin is a Director and the Chairman, Arnold D. Scott,
Jeffrey L. Shames, and James R. Bordewick, Jr., are Directors, Stephen E. Cavan
is a Director and the Secretary, Ziad Malek is the President, Joseph W. Dello
Russo is the Treasurer, and Robert T. Burns is the Assistant Secretary.
MIL FUND
A. Keith Brodkin is the Chairman, President and a Director, Richard B.
Bailey, John A. Brindle and Richard W. S. Baker are Directors, Stephen E. Cavan
is the Secretary, W. Thomas London is the Treasurer, James O. Yost is the
Assistant Treasurer and James R. Bordewick, Jr., is the Assistant Secretary, and
Ziad Malek is a Senior Vice President.
<PAGE>
MFS MERIDIAN FUND
A. Keith Brodkin is the Chairman, President and a Director, Richard B.
Bailey, John A. Brindle, Richard W. S. Baker, Arnold D. Scott and Jeffrey L.
Shames are Directors, Stephen E. Cavan is the Secretary, W. Thomas London is the
Treasurer, James R. Bordewick, Jr., is the Assistant Secretary, James O. Yost is
the Assistant Treasurer, and Ziad Malek is a Senior Vice President.
MFD
A. Keith Brodkin is the Chairman and a Director, Arnold D. Scott and
Jeffrey L. Shames are Directors, William W. Scott, Jr., an Executive Vice
President of MFS, is the President, Stephen E. Cavan is the Secretary, Robert T.
Burns is the Assistant Secretary, Joseph W. Dello Russo is the Treasurer, and
James E. Russell is the Assistant Treasurer.
CIAI
A. Keith Brodkin is the Chairman and a Director, Arnold D. Scott and
Jeffrey L. Shames are Directors, Cynthia Orcott is President, Bruce C. Avery is
the Vice President, Joseph W. Dello Russo is the Treasurer, James E. Russell is
the Assistant Treasurer, Stephen E. Cavan is the Secretary, and Robert T. Burns
is the Assistant Secretary.
MFSC
A. Keith Brodkin is the Chairman and a Director, Arnold D. Scott and
Jeffrey L. Shames are Directors, Joseph A. Recomendes, a Senior Vice President
of MFS, is Vice Chairman and a Director, Janet A. Clifford is the Executive Vice
President, Joseph W. Dello Russo is the Treasurer, James E. Russell is the
Assistant Treasurer, Stephen E. Cavan is the Secretary, and Robert T. Burns is
the Assistant Secretary.
AMI
A. Keith Brodkin is the Chairman and a Director, Jeffrey L. Shames,
and Arnold D. Scott are Directors, Thomas J. Cashman, Jr., is the President and
a Director, Leslie J. Nanberg is a Senior Vice President, a Managing Director
and a Director, Carol A. Corley, John A. Gee and Brianne Grady are Senior Vice
Presidents and Managing Directors, Joseph W. Dello Russo is the Treasurer, James
E. Russell is the Assistant Treasurer and Robert T. Burns is the Secretary.
RSI
William W. Scott, Jr., Joseph A. Recomendes and Bruce C. Avery are
Directors, Arnold D. Scott is the Chairman and a Director, Douglas C. Grip, a
Senior Vice President of MFS, is the President, Joseph W. Dello Russo is the
Treasurer, James E. Russell is the Assistant Treasurer, Stephen E. Cavan is the
Secretary, Robert T. Burns is the Assistant Secretary and Sharon A. Brovelli is
a Senior Vice President.
<PAGE>
In addition, the following persons, Directors or officers of MFS, have
the affiliations indicated:
A. Keith Brodkin Director, Sun Life Assurance Company of
Canada (U.S.), One Sun Life Executive Park,
Wellesley Hills, Massachusetts
Director, Sun Life Insurance and Annuity
Company of New York, 67 Broad Street,
New York, New York
John R. Gardner President and a Director, Sun Life Assurance
Company of Canada, Sun Life Centre, 150 King
Street West, Toronto, Ontario, Canada (Mr.
Gardner is also an officer and/or Director
of various subsidiaries and affiliates of
Sun Life)
John D. McNeil Chairman, Sun Life Assurance Company of
Canada, Sun Life Centre, 150 King Street
West, Toronto, Ontario, Canada (Mr. McNeil
is also an officer and/or Director of
various subsidiaries and affiliates of Sun
Life)
Joseph W. Dello Russo Director of Mutual Fund Operations, The
Boston Company, Exchange Place, Boston,
Massachusetts (until August, 1994)
ITEM 29. DISTRIBUTORS
(a) Reference is hereby made to Item 28 above.
(b) Reference is hereby made to Item 28 above; the principal business
address of each of these persons is 500 Boylston Street, Boston, Massachusetts
02116.
(c) Not applicable.
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
The accounts and records of the Registrant are located, in whole or in
part, at the
<PAGE>
office of the Registrant and the following locations:
NAME ADDRESS
---- -------
Massachusetts Financial 500 Boylston Street
Services Company Boston, MA 02116
MFS Distributors, Inc. 500 Boylston Street
Boston, MA 02116
State Street Bank and State Street South
Trust Company 5-West
North Quincy, MA 02171
MFS Service Center, Inc. 500 Boylston Street
Boston, MA 02116
The Registrant's corporate documents are kept by the Registrant at its
offices. Portfolio brokerage orders, other purchase orders, reasons for
brokerage allocation and lists of persons authorized to transact business for
the Registrant are kept by Massachusetts Financial Services Company at 500
Boylston Street, Boston, Massachusetts 02116. Shareholder account records are
kept by MFS Service Center, Inc. at 500 Boylston Street, Boston, Massachusetts
02116. Transaction journals, receipts for the acceptance and delivery of
securities and cash, ledgers and trial balances are kept by State Street Bank
and Trust Company at State Street South, 5-West, North Quincy, Massachusetts
02171.
ITEM 31. MANAGEMENT SERVICES
Not applicable.
ITEM 32. UNDERTAKINGS
(a) Not applicable.
(b) The Registrant undertakes to file a post-effective amendment on
behalf of the Research Fund, using financial statements which need not be
certified, within four to six months from the effective date of the commencement
of investment operations of the Research Fund.
(c) The registrant undertakes to furnish each person to whom a
prospectus is delivered with a copy of the Registrant's latest annual report to
shareholders upon request and without charge.
(d) Insofar as indemnification for liability arising under the
Securities Act of 1933 may be permitted to trustees, officers and controlling
persons of the Registrant pursuant to the provisions set forth in Item 27 of
this Part C, or otherwise, the Registrant has been advised
<PAGE>
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a trustee, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
Registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Post-
Effective Amendment to the Registration Statement to be signed on its behalf by
the undersigned, thereto duly authorized, in the City of Boston and The
Commonwealth of Massachusetts on the 30th day of August, 1995.
MFS UNION STANDARD TRUST
By: JAMES R. BORDEWICK, JR.
---------------------------
Name: James R. Bordewick, Jr.
Title: Assistant Secretary
Pursuant to the requirements of the Securities Act of 1933, this Post-
Effective Amendment to its Registration Statement has been signed below by the
following persons in the capacities indicated on August 30, 1995.
SIGNATURE TITLE
--------- -----
A. KEITH BRODKIN* Chairman, President (Principal
------------------------- Executive Officer) and Trustee
A. Keith Brodkin
W. THOMAS LONDON* Treasurer (Principal Financial Officer
------------------------- and Principal Accounting Officer)
W. Thomas London
WILLIAM R. GUTOW* Trustee
-------------------------
William R. Gutow
NELSON J. DARLING, JR*. Trustee
-------------------------
Nelson J. Darling, Jr.
<PAGE>
*By: JAMES R. BORDEWICK, JR.
---------------------------
Name: James R. Bordewick, Jr.
as Attorney-in-fact
Executed by James R. Bordewick, Jr.
on behalf of those indicated pursuant
to a Power of Attorney dated
August 12, 1994.
<PAGE>
POWER OF ATTORNEY
MFS Union Standard Trust
The undersigned, Trustees and officers of MFS Union Standard Trust (the
"Registrant"), hereby severally constitute and appoint A. Keith Brodkin, W.
Thomas London, Stephen E. Cavan and James R. Bordewick, Jr., and each of them
singly, as true and lawful attorneys, with full power to them and each of them
to sign for each of the undersigned, in the names of, and in the capacities
indicated below, any Registration Statement and any and all amendments thereto
and to file the same with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission for the
purpose of registering the Registrant as a management investment company under
the Investment Company Act of 1940 and/or the shares issued by the Registrant
under the Securities Act of 1933 granting unto our said attorneys, and each of
them, acting alone, full power and authority to do and perform each and every
act and thing requisite or necessary or desirable to be done in the premises, as
fully to all intents and purposes as he or she might or could do in person,
hereby ratifying and confirming all that said attorneys or any of them may
lawfully do or cause to be done by virtue thereof.
In WITNESS WHEREOF, the undersigned have hereunto set their hand on this
12th day of August, 1994.
Signatures Title(s)
---------- ---------
A. KEITH BRODKIN Chairman of the Board;
---------------------- Trustee; and Principal
A. Keith Brodkin Executive Officer
NELSON J. DARLING, JR. Trustee
----------------------
Nelson J. Darling, Jr.
WILLIAM R. GUTOW Trustee
----------------------
William R. Gutow
W. THOMAS LONDON Principal Financial and Accounting
---------------------- Officer
W. Thomas London
<PAGE>
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION OF EXHIBIT PAGE NO.
----------- ---------------------- --------
1 (a) Declaration of Trust dated September 1, 1993.
(b) Amendment to Declaration of Trust-Designation of
Series dated September 1, 1993.
(c) Amendment to Declaration of Trust - Abolishment of
MFS Union Standard Fixed Income Fund, a series of
Shares of Beneficial Interest and Establishment and
Designation of MFS Union Standard Research Fund, a
series of Shares of Beneficial Interest, dated
August 29, 1995.
2 By-Laws, dated September 1, 1993.
5 (a) Investment Advisory Agreement by and between MFS
Union Standard Trust on behalf of MFS Union Standard
Equity Fund and Massachusetts Financial Services
Company dated December 8, 1993.
(b) Form of Investment Advisory Agreement by and between
MFS Union Standard Trust on behalf of MFS Union
Standard Research Fund and Massachusetts Financial
Services Company dated November 15, 1995.
6 Distribution Agreement dated December 8, 1993.
8 (b) Amendment to the Custodian Agreement dated
December 8, 1993.
8 (c) Form of Amendment to Custodian Contract dated
November 15, 1995.
9 (a) Form of Amended and Restated Shareholder Servicing
Agent Agreement between Registrant and MFS Service
Center dated November 15, 1995.
<PAGE>
EXHIBIT NO. DESCRIPTION OF EXHIBIT PAGE NO.
----------- ---------------------- --------
(c) Dividend Disbursing Agency Agreement between
Registrant and State Street Bank and Trust Company
dated December 8, 1993.
13 Investment Representation Letter dated
November 19, 1993.
15 (a) Distribution Plan for MFS Union Standard Equity Fund
dated December 8, 1993.
(b) Form of Distribution Plan for MFS Union Standard
Research Fund dated November 15, 1995.
<PAGE>
EXHIBIT 1a
MFS UNION STANDARD TRUST
DECLARATION OF TRUST
DATED SEPTEMBER 1, 1993
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I--NAME AND DEFINITIONS:
Section 1.1. Name . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2. Definitions. . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II--TRUSTEES:
Section 2.1 Number of Trustees . . . . . . . . . . . . . . . . . . . 3
Section 2.2. Term of Office of Trustees . . . . . . . . . . . . . . . 3
Section 2.3. Resignation and Appointment of Trustees. . . . . . . . . 3
Section 2.4. Vacancies. . . . . . . . . . . . . . . . . . . . . . . . 3
Section 2.5. Delegation of Power to Other Trustees. . . . . . . . . . 4
ARTICLE III--POWERS OF TRUSTEES:
Section 3.1. General. . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 3.2. Investments. . . . . . . . . . . . . . . . . . . . . . . 4
Section 3.3. Legal Title. . . . . . . . . . . . . . . . . . . . . . . 5
Section 3.4. Issuance and Repurchase of Securities. . . . . . . . . . 5
Section 3.5. Borrowing Money; Lending Trust Property. . . . . . . . . 5
Section 3.6. Delegation; Committees . . . . . . . . . . . . . . . . . 6
Section 3.7. Collection and Payment . . . . . . . . . . . . . . . . . 6
Section 3.8. Expenses . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 3.9. Manner of Acting; By-Laws. . . . . . . . . . . . . . . . 6
Section 3.10. Miscellaneous Powers . . . . . . . . . . . . . . . . . . 6
Section 3.11. Principal Transactions . . . . . . . . . . . . . . . . . 7
Section 3.12. Trustees and Officers as Shareholders. . . . . . . . . . 7
ARTICLE IV--INVESTMENT ADVISER, DISTRIBUTOR AND TRANSFER AGENT:
Section 4.1. Investment Adviser . . . . . . . . . . . . . . . . . . . 7
Section 4.2. Distributor. . . . . . . . . . . . . . . . . . . . . . . 8
Section 4.3. Transfer Agent . . . . . . . . . . . . . . . . . . . . . 8
Section 4.4. Parties to Contract. . . . . . . . . . . . . . . . . . . 8
ARTICLE V--LIMITATIONS OF LIABILITY OF SHAREHOLDERS, TRUSTEES AND OTHERS:
Section 5.1. No Personal Liability of Shareholders, Trustees, etc.. . 9
Section 5.2. Non-Liability of Trustees, etc.. . . . . . . . . . . . . 9
Section 5.3. Mandatory Indemnification. . . . . . . . . . . . . . . . 9
Section 5.4. No Bond Required of Trustees . . . . . . . . . . . . . .11
Section 5.5. No Duty of Investigation; Notice in Trust
Instruments, etc. . . . . . . . . . . . . . . . . .11
Section 5.6. Reliance on Experts, etc.. . . . . . . . . . . . . . . .11
I
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE VI--SHARES OF BENEFICIAL INTEREST:
Section 6.1. Beneficial Interest. . . . . . . . . . . . . . . . . . .11
Section 6.2. Rights of Shareholders . . . . . . . . . . . . . . . . .12
Section 6.3. Trust Only . . . . . . . . . . . . . . . . . . . . . . .12
Section 6.4. Issuance of Shares . . . . . . . . . . . . . . . . . . .12
Section 6.5. Register of Shares . . . . . . . . . . . . . . . . . . .12
Section 6.6. Transfer of Shares . . . . . . . . . . . . . . . . . . .12
Section 6.7. Notices. . . . . . . . . . . . . . . . . . . . . . . . .13
Section 6.8. Voting Powers. . . . . . . . . . . . . . . . . . . . . .13
Section 6.9. Series Designation . . . . . . . . . . . . . . . . . . .13
Section 6.10. Class Designation. . . . . . . . . . . . . . . . . . . .15
ARTICLE VII--REDEMPTIONS:
Section 7.1. Redemption of Shares . . . . . . . . . . . . . . . . . .16
Section 7.2. Price. . . . . . . . . . . . . . . . . . . . . . . . . .16
Section 7.3. Payment. . . . . . . . . . . . . . . . . . . . . . . . .16
Section 7.4. Effect of Suspension of Determination of Net Asset
Value. . . . . . . . . . . . . . . . . . . . . . . .16
Section 7.5. Redemption of Shares in Order to Qualify as Regulated
Investment Company; Disclosure of Holding. . . . . .16
Section 7.6. Suspension of Right to Redemption. . . . . . . . . . . .17
ARTICLE VIII--DETERMINATION OF NET ASSET VALUE, NET INCOME AND DISTRIBUTIONS:17
ARTICLE IX--DURATION; TERMINATION OF TRUST; AMENDMENT; MERGERS, ETC.:
Section 9.1. Duration . . . . . . . . . . . . . . . . . . . . . . . .18
Section 9.2. Termination of Trust . . . . . . . . . . . . . . . . . .18
Section 9.3. Amendment Procedure. . . . . . . . . . . . . . . . . . .19
Section 9.4. Merger, Consolidation and Sale of Assets . . . . . . . .19
Section 9.5. Incorporation and Reorganization . . . . . . . . . . . .20
Section 9.6. Incorporation or Reorganization of Series. . . . . . . .20
ARTICLE X--REPORTS TO SHAREHOLDERS AND SHAREHOLDER COMMUNICATIONS: . . . . .20
ARTICLE XI--MISCELLANEOUS:
Section 11.1. Filing . . . . . . . . . . . . . . . . . . . . . . . . .21
Section 11.2. Governing Law. . . . . . . . . . . . . . . . . . . . . .21
Section 11.3. Counterparts . . . . . . . . . . . . . . . . . . . . . .21
Section 11.4. Reliance By Third Parties. . . . . . . . . . . . . . . .22
Section 11.5. Provisions in Conflict with Law or Regulations . . . . .22
SIGNATURE PAGE AND ADDRESSES:. . . . . . . . . . . . . . . . . . . . . . . .23
NOTARY:. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24
II
<PAGE>
DECLARATION OF TRUST
OF
MFS UNION STANDARD TRUST
Dated September 1, 1993
DECLARATION OF TRUST, made September 1, 1993, by the Trustees;
WHEREAS, the Trustees desire to establish a trust for the investment and
reinvestment of funds contributed thereto; and
WHEREAS, the Trustees desire that the beneficial interest in the trust
assets be divided into transferable Shares of Beneficial Interest (without par
value) issued in one or more series, as hereinafter provided; and
NOW THEREFORE, the Trustees hereby declare that all money and property
contributed to the trust established hereunder shall be held and managed in
trust for the benefit of holders, from time to time, of the Shares of Beneficial
Interest (without par value) issued hereunder and subject to the provisions
hereof:
ARTICLE I
NAME AND DEFINITIONS
SECTION 1.1. NAME. The name of the Trust created hereby is the "MFS Union
Standard Trust", the current address of which is 500 Boylston Street, Boston,
Massachusetts 02116.
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) "COMMISSION" has the meaning given that term 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.
1
<PAGE>
(d) "DISTRIBUTOR" means the party, other than the Trust, to the contract
described in Section 4.2 hereof.
(e) "INTERESTED PERSON" has the meaning given that term in the 1940 Act.
(f) "INVESTMENT ADVISER" means a party furnishing services to the Trust
pursuant to any contract described in Section 4.1 hereof.
(g) "MAJORITY SHAREHOLDER VOTE" has the same meaning as the phrase "vote
of a majority of the outstanding voting securities" as defined in the 1940 Act,
except that such term may be used herein with respect to the Shares of the Trust
as a whole or the Shares of any particular series or class, as the context may
require.
(h) "1940 ACT" means the Investment Company Act of 1940 and the Rules and
Regulation thereunder, as amended from time to time.
(i) "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.
(j) "SHAREHOLDER" means a record owner of outstanding Shares.
(k) "SHARES" means the Shares of Beneficial Interest into which the
beneficial interest in the Trust shall be divided from time to time or, when
used in relation to any particular series or class of Shares established by the
Trustees pursuant to Section 6.9 or Section 6.10 hereof, respectively, equal
proportionate transferable units into which such series or class of Shares shall
be divided from time to time. The term "Shares" includes fractions of Shares as
well as whole Shares.
(l) "TRANSFER AGENT" means the party, other than the Trust, to a contract
described in Section 4.3 hereof.
(m) "TRUST" means the trust created hereby.
(n) "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, including, without limitation, any and all property
allocated or belonging to any series of Shares pursuant to Section 6.9 hereof.
(o) "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 or appointed, 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.
2
<PAGE>
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.
SECTION 2.2. TERM OF OFFICE OF TRUSTEES. Subject to the provisions of
Section 16(a) of the 1940 Act, the Trustees shall hold office during the
lifetime of this Trust and until its termination as hereinafter provided; 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 of the Trust. 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 incapacity 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. An appointment of a Trustee may be made by the
Trustees then in office 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 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
3
<PAGE>
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 months at
any one time to any other Trustee or Trustees; provided that in no case shall
less than two 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.
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 the order of or resort to any court.
SECTION 3.2. INVESTMENTS. (a) The Trustees shall have the power:
(i) to conduct, operate and carry on the business of an investment
company;
(ii) to 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 U.S. and foreign currencies, any form of gold
and other precious metals, commodity contracts, options, contracts for the
future acquisition or delivery of fixed income or other 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 subdivision,
agency or instrumentality of
4
<PAGE>
any such Person, or by the U.S. Government, any foreign government, any
political subdivision or any agency or instrumentality of the U.S. Government,
any foreign government or any political subdivision of the U.S. Government or
any foreign government, or any international instrumentality, 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, to 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; and
(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.
(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 or 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, redeem, retire, cancel, acquire,
hold, resell, reissue, dispose of, transfer, and otherwise deal in Shares and,
subject to the provisions set forth in Articles VII, VIII and IX and Section 6.9
hereof, to apply to any such repurchase, redemption, retirement, cancellation or
acquisition of Shares any funds of the Trust or other Trust Property whether
capital or surplus or otherwise, to the full extent now or hereafter permitted
by 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 Trust Property, to
endorse, guarantee, or undertake the performance of any obligation, contract or
engagement of any other Person and to lend Trust Property.
5
<PAGE>
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. Subject to Section 6.9 hereof, the
Trustees shall have power to collect all property due to the Trust; to pay all
claims, including taxes, against the Trust Property; to prosecute, 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. Subject to Section 6.9 hereof, 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 the 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 or agents of
the Trust; (f) to the extent permitted by law, indemnify any person with whom
the Trust has dealings, including the Investment Adviser, Distributor, Transfer
Agent, and any dealer, to such extent as the Trustees shall determine; (g)
determine and change the fiscal year of the Trust and the method by which its
accounts shall be kept; and (h) adopt a seal for the Trust, provided, that the
absence of such seal shall not impair the validity of any instrument executed on
behalf of the Trust.
6
<PAGE>
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 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, employee, 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 Shares from the Trust 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 customers;
(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, employee, director or trustee of the Investment Adviser or of
the Distributor at a price not lower than the net asset value of the Shares next
determined after acceptance of the order by the Trust, provided that any such
sales are only to be made pursuant to a uniform offer described in the Trust's
current prospectus; or
(d) The Investment Adviser, the Distributor or any of their officers,
employees, 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
of the Shares of each series affected thereby, 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 or furnish
the Trust such management, investment advisory, statistical and research
facilities and services, promotional activities, and such other facilities and
services, if any, with respect to one or more series of Shares, as the Trustees
shall from time to time consider desirable
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and all upon such terms and conditions as the Trustees may in their discretion
determine. Notwithstanding any provision 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 and other financial intermediaries to further the purpose of
the distribution or repurchase 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 or parties to such contract or contracts shall
undertake to furnish transfer agency and/or shareholder services. The contract
or contracts shall have such terms and conditions as the 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 Section 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.
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ARTICLE V
LIMITATIONS OF LIABILITY OF
SHAREHOLDERS, TRUSTEES AND OTHERS
SECTION 5.1. NO PERSONAL LIABILITY OF SHAREHOLDERS, TRUSTEES, ETC. 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
liability. 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. Notwithstanding any other provision of this
Declaration to the contrary, no Trust Property shall be used to indemnify or
reimburse any Shareholder of any Shares of any series other than Trust Property
allocated or belonging to such series.
SECTION 5.2. NON-LIABILITY OF TRUSTEES, ETC. 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,
administrative 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:
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(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; or
(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, the Trust's 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
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, 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
(without par value) which shall be divided into one or more series as provided
in Section 6.9 hereof. The number of Shares authorized hereunder is unlimited.
All Shares issued hereunder including, without limitation, Shares issued
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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 specifically set forth in the Declaration. The Shares
shall not entitle the holder to preference, preemptive, appraisal, conversion or
exchange rights, except as the Trustees may determine with respect to any series
of or class Shares.
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 liabilities) 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 of any series into a greater or lesser number without thereby changing
their proportionate beneficial interests in Trust Property allocated or
belonging to such series. Contributions to the Trust may be accepted for, and
Shares shall be redeemed as, whole Shares and/or 1/1,000ths 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. It is not contemplated that certificates will be issued for the
Shares; however, 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
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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.
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 removal of Trustees 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 9.2 hereof, (iv) with respect to any amendment of this Declaration to
the extent and as provided in Section 9.3 hereof, (v) with respect to any
merger, consolidation or sale of assets as provided in Sections 9.4 and 9.6
hereof, (vi) with respect to incorporation of the Trust or any series to the
extent and as provided in Sections 9.5 and 9.6 hereof, (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
and during any period when no Shares are outstanding, 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 Shareholder votes and meetings and related matters.
SECTION 6.9. SERIES DESIGNATION. Shares of the Trust may be divided into
series, the number and relative rights, privileges and preferences of which
shall be established and designated by the Trustees, in their discretion, in
accordance with the terms of this Section 6.9. The Trustees may from time to
time exercise their power to authorize the division of Shares into
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one or more series by establishing and designating one or more series of Shares
upon and subject to the following provisions:
(a) All Shares shall be identical except that there may be such
variations as shall be fixed and determined by the Trustees between different
series as to purchase price, right of redemption and the price, terms and manner
of redemption, and special and relative rights as to dividends and on
liquidation.
(b) The number of authorized Shares and the number of Shares of each
series that may be issued shall be unlimited. The Trustees may classify or
reclassify any unissued Shares or any Shares previously issued and reacquired of
any series into one or more series that may be established and designated from
time to time. The Trustees may hold as treasury shares (of the same or some
other series), reissue for such consideration and on such terms as they may
determine, or cancel any Shares of any series reacquired by the Trust at their
discretion from time to time.
(c) All consideration received by the Trust for the issue or sale of
Shares of a particular series, together with all assets in which such
consideration is invested or reinvested, all income, earnings, profits, and
proceeds thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall
irrevocably belong to that series for all purposes, subject only to the rights
of creditors of such series, and shall be so recorded upon the books of account
of the Trust. In the event that there are any assets, income, earnings,
profits, and proceeds thereof, funds, or payments which are not readily
identifiable as belonging to any particular series, the Trustees shall allocate
them among any one or more of the series established and designated from time to
time in such a manner and on such basis as they, in their sole discretion, deem
fair and equitable. Each such allocation by the Trustees shall be conclusive
and binding upon the Shareholders of all series for all purposes. No holder of
Shares of any particular series shall have any claim on or right to any assets
allocated or belonging to any other series of Shares.
(d) The assets belonging to each particular series shall be charged
with the liabilities of the Trust in respect of that series and all expenses,
costs, charges and reserves attributable to that series, and any general
liabilities, expenses, costs, charges or reserves of the Trust which are not
readily identifiable as belonging to any particular series shall be allocated
and charged by the Trustees to and among any one or more of the series
established and designated from time to time in such manner and on such basis as
the Trustees in their sole discretion deem fair and equitable. Each allocation
of liabilities, expenses, costs, charges and reserves by the Trustees shall be
conclusive and binding upon the holders of all series for all purposes. The
Trustees shall have full discretion to the extent not inconsistent with the 1940
Act, to determine which items shall be treated as income and which items as
capital; and each such determination and allocation shall be conclusive and
binding upon the Shareholders. Under no circumstances shall the assets
allocated or belonging to any particular series be charged with liabilities
attributable to any other series. All Persons who have extended credit which
has been allocated to a particular series, or who have a claim or contract which
has been allocated to any particular series, shall look only to the assets of
that particular series for payment of such credit, claim or contract.
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(e) The power of the Trustees to invest and reinvest the Trust
Property allocated or belonging to any particular series shall be governed by
Section 3.2 hereof unless otherwise provided in the instrument of the Trustees
establishing such series which is hereinafter described.
(f) Each Share of a series shall represent a beneficial interest in
the net assets allocated or belonging to such series only, and such interest
shall not extend to the assets of the Trust generally. Dividends and
distributions on Shares of a particular series may be paid with such frequency
as the Trustees may determine, which may be daily or otherwise, pursuant to a
standing resolution or resolutions adopted only once or with such frequency as
the Trustees may determine, to the holders of Shares of that series, only from
such of the income and capital gains, accrued or realized, from the assets
belonging to that series, as the Trustees may determine, after providing for
actual and accrued liabilities belonging to that series. All dividends and
distributions on Shares of a particular series shall be distributed pro rata to
the holders of that series in proportion to the number of Shares of that series
held by such holders at the date and time of record established for the payment
of such dividends or distributions. Shares of any particular series of the
Trust may be redeemed solely out of Trust Property allocated or belonging to
that series. Upon liquidation or termination of a series of the Trust,
Shareholders of such series shall be entitled to receive a pro rata share of the
net assets of such series only. A Shareholder of a particular series of the
Trust shall not be entitled to participate in a derivative or class action on
behalf of any other series or the Shareholders of any other series of the Trust.
(g) Notwithstanding any provision hereof to the contrary, on any
matter submitted to a vote of the Shareholders of the Trust, all Shares then
entitled to vote shall be voted in the aggregate, except that (i) when required
by the 1940 Act to be voted by individual series or class, Shares shall not be
voted in the aggregate, and (ii) when the Trustees have determined that the
matter affects only the interests of Shareholders of one or more series or
class, only Shareholders of such series or class shall be entitled to vote
thereon.
(h) The establishment and designation of any series of Shares shall
be effective upon the execution by a majority of the then Trustees of an
instrument setting forth such establishment and designation and the relative
rights and preferences of such series, or as otherwise provided in such
instrument. At any time that there are no Shares outstanding of any particular
series previously established and designated, the Trustees may by an instrument
executed by a majority of their number abolish that series and the establishment
and designation thereof. Each instrument referred to in this paragraph shall
have the status of an amendment to this Declaration.
SECTION 6.10 CLASS DESIGNATION. The Trustees may, in their discretion,
authorize the division of Shares of the Trust (or any series of the Trust) into
one or more classes. All Shares of a class shall be identical with each other
and with the Shares of each other class of the Trust or the same series of the
Trust (as applicable), except for such variations between classes as may be
approved by the Board of Trustees and permitted by the 1940 Act or pursuant to
any exemptive order issued by the Commission.
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ARTICLE VII
REDEMPTIONS
SECTION 7.1. REDEMPTION OF SHARES. All Shares of the Trust shall be
redeemable, at the redemption price determined in the manner set out in this
Declaration. Redeemed Shares may be resold by the Trust.
The Trust shall redeem the Shares at the price determined as hereinafter
set forth, upon acceptance of the appropriately verified written application of
the record holder thereof (or upon such other form of request as the Trustees
may determine) at such office or agency as may be designated from time to time
for that purpose in the Trust's then effective prospectus under the Securities
Act of 1933. The Trustees may from time to time specify additional conditions,
not inconsistent with the 1940 Act, regarding the redemption of Shares in the
Trust's then effective prospectus under the Securities Act of 1933.
SECTION 7.2. PRICE. Shares shall be redeemed at their net asset value
determined as set forth in Article VIII hereof as of such time as the Trustees
shall have theretofore prescribed by resolution. In the absence of such
resolution, the redemption price of Shares deposited shall be the net asset
value of such Shares next determined as set forth in Article VIII hereof after
acceptance of such application.
SECTION 7.3. PAYMENT. Payment of the redemption price of Shares of any
series shall be made in cash or in property out of the assets of such series to
the Shareholder of record at such time and in the manner, not inconsistent with
the 1940 Act or other applicable laws, as may be specified from time to time in
the Trust's then effective prospectus under the Securities Act of 1933, subject
to the provisions of Section 7.4 hereof.
SECTION 7.4. EFFECT OF SUSPENSION OF DETERMINATION OF NET ASSET VALUE. If,
pursuant to Section 7.6 hereof, the Trustees shall declare a suspension of the
determination of net asset value, the rights of Shareholders (including those
who shall have applied for redemption pursuant to Section 7.1 hereof but who
shall not yet have received payment) to have Shares redeemed and paid for by the
Trust shall be suspended until the termination of such suspension is declared.
Any record holder who shall have his redemption right so suspended may, during
the period of such suspension, by appropriate written notice of revocation at
the office or agency where application was made, revoke any application for
redemption not honored and withdraw any certificates on deposits. The
redemption price of Shares for which redemption applications have not been
revoked shall be the net asset value of such Shares next determined as set forth
in Article VIII after the termination of such suspension, and payment shall be
made within seven days after the date upon which the application was made plus
the period after such applications during which the determination of net asset
value was suspended.
SECTION 7.5. REDEMPTION OF SHARES IN ORDER TO QUALIFY AS REGULATED
INVESTMENT COMPANY; DISCLOSURE OF HOLDING. If the Trustees shall, at any time
and in good faith, be of the opinion that direct or indirect ownership of Shares
or other securities of the Trust has or may become concentrated in any Person to
an extent which would disqualify the Trust or any series of the Trust as a
regulated investment company under the Internal Revenue Code of 1986, as
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amended, then the Trustees shall have the power by lot or other means deemed
equitable by them (i) to call for redemption by any such Person a number, or
principal amount, of Shares or other securities of the Trust sufficient to
maintain or bring the direct or indirect ownership of Shares or other securities
of the Trust into conformity with the requirements for such qualification and
(ii) to refuse to transfer or issue Shares or other securities of the Trust to
any Person whose acquisition of the Shares or other securities of the Trust in
question would result in such disqualification. The redemption shall be
effected at the redemption price and in the manner provided in Section 7.1.
The holders of Shares or other securities of the Trust shall upon demand
disclose to the Trustees in writing such information with respect to direct and
indirect ownership of Shares or other securities of the Trust as the Trustees
deem necessary to comply with the provisions of the Internal Revenue Code of
1986, as amended, or to comply with the requirements of any other taxing
authority.
SECTION 7.6. SUSPENSION OF RIGHT OF REDEMPTION. The Trust may declare a
suspension of the right of redemption or postpone the date of payment or
redemption for the whole or any part of any period (i) during which the New York
Stock Exchange is closed other than customary weekend and holiday closings, (ii)
during which trading on the New York Stock Exchange is restricted, (iii) during
which an emergency exists as a result of which disposal by the Trust of
securities owned by it is not reasonably practicable or it is not reasonably
practicable for the Trust fairly to determine the value of its net assets, or
(iv) during any other period when the Commission may for the protection of
security holders of the Trust by order permit suspension of the right of
redemption or postponement of the date of payment or redemption; provided that
applicable rules and regulations of the Commission shall govern as to whether
the conditions prescribed in (ii), (iii), or (iv) exist. Such suspension shall
take effect at such time as the Trust shall specify but not later than the close
of business on the business day next following the declaration of suspension,
and thereafter there shall be no right of redemption or payment on redemption
until the Trust shall declare the suspension at an end, except that the
suspension shall terminate in any event on the first day on which said stock
exchange shall have reopened or the period specified in (ii) or (iii) shall have
expired (as to which in the absence of an official ruling by the Commission, the
determination of the Trust shall be conclusive). In the case of a suspension of
the right of redemption a Shareholder may either withdraw his request for
redemption or receive payment based on the net asset value existing after the
termination of the suspension as provided in Section 7.4 hereof.
ARTICLE VIII
DETERMINATION OF NET ASSET VALUE,
NET INCOME AND DISTRIBUTIONS
Subject to Section 6.9 hereof, 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 of any series or net income attributable to the Shares of any
series, or the declaration and payment of dividends and distributions on the
Shares of any series, as they may deem necessary or desirable.
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ARTICLE IX
DURATION, TERMINATION OF TRUST;
AMENDMENT; MERGERS, ETC.
SECTION 9.1. DURATION. The Trust shall continue without limitation of
time but subject to the provisions of this Article IX.
SECTION 9.2. 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 its Shares, or (ii) by the Trustees by written
notice to the Shareholders. Any series of 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 of that series, or (ii) by the Trustees by
written notice to the Shareholders of that series.
Upon the termination of the Trust or any series of the Trust:
(i) The Trust or series of 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
or series of the Trust and all the powers of the Trustees under this Declaration
shall continue until the affairs of the Trust or series of the Trust shall have
been wound up, including the power to fulfill or discharge the contracts of the
Trust or series of the Trust, collect its assets, sell, convey, assign,
exchange, transfer or otherwise dispose of all or any part of the remaining
Trust Property or Trust Property of the series 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 9.4 hereof, and any sale, conveyance, assignment,
exchange, transfer or other disposition of all or substantially all of the Trust
Property allocated or belonging to any series shall require the approval of the
Shareholders of such series as provided in Section 9.6 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 or Trust Property of the series, in cash
or in kind or partly in cash and partly in kind, among the Shareholders of the
Trust or the series according to their respective rights.
(b) After termination of the Trust or series and distribution to the
Shareholders of the Trust or series 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 with
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respect to the Trust or series, and the rights and interests of all Shareholders
of the Trust or series shall thereupon cease.
SECTION 9.3. AMENDMENT PROCEDURE. (a) This Declaration may be amended by
a Majority Shareholder Vote of the Shareholders of the Trust or by any
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 of the
Trust. The Trustees may also amend this Declaration without the vote or consent
of Shareholders to designate series in accordance with Section 6.9 hereof, 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 or advisable 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 of 1986, as amended,
but the Trustees shall not be liable for failing so to do.
(b) No amendment which the Trustees shall have determined shall affect the
rights, privileges or interests of holders of a particular series of Shares, but
not the rights, privileges or interests of holders of Shares of the Trust
generally, may be made except with the vote or consent by a Majority Shareholder
Vote of such series.
(c) Notwithstanding any other provision hereof, no amendment may be made
under this Section 9.3 which would change any rights with respect to the Shares,
or any series of Shares, by reducing the amount payable thereon upon liquidation
of the Trust or by diminishing or eliminating any voting rights pertaining
thereto, except with a Majority Shareholder Vote of Shares or series of Shares.
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 assessments
upon Shareholders.
(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.
(e) 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 the Trust shall have become
effective, this Declaration may be amended in any respect by the affirmative
vote of majority of the Trustees or by instrument signed by a majority of the
Trustees.
SECTION 9.4. 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 such purpose by the holders of not less than two-thirds of the Shares
outstanding and entitled to vote of the Trust, or such other vote as may be
established by the Trustees with respect to any series of Shares, or by an
instrument or instruments in writing without a meeting, consented to by the
holders of not less than two-thirds of the Shares outstanding and entitled to
vote of the Trust; provided, however that if such merger, consolidation, sale,
lease or exchange is
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recommended by the Trustees, the vote of the holders of a majority of the Shares
outstanding and entitled to vote, or such other vote as may be established by
the Trustees with respect to any series of Shares, 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 shareholders for any sale of assets in the
ordinary course of the business of the Trust.
SECTION 9.5. 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, unit
investment 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 9.4 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. Nothing contained in this Section 9.5 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.
SECTION 9.6. INCORPORATION OR REORGANIZATION OF SERIES. With the approval
of a Majority Shareholder Vote of any series, the Trustees may sell, lease or
exchange all of the Trust Property allocated or belonging to that series, or
cause to be organized or assist in organizing a corporation or corporations
under the laws of any other jurisdiction, or any other trust, unit investment
trust, partnership, association or other organization, to take over all of the
Trust Property allocated or belonging to that series and to sell, convey and
transfer such Trust Property to any such corporation, trust, unit investment
trust, partnership, association, or other organization in exchange for the
shares or securities thereof or otherwise.
ARTICLE X
REPORTS TO SHAREHOLDERS AND SHAREHOLDER COMMUNICATIONS
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.
Whenever 10 or more Shareholders of record who have been such for at least
six months preceding the date of application, and who hold in the aggregate
either Shares having a net asset value of at least $25,000 or at least l% of the
Shares outstanding, whichever is less, shall apply to the Trustees in writing,
stating that they wish to communicate with other Shareholders with a
20
<PAGE>
view to obtaining signatures to a request for a meeting of Shareholders for the
purpose of removing one or more Trustees pursuant to Section 2.2 hereof and
accompany such application with a form of communication and request which they
wish to transmit, the Trustees shall within five business days after receipt of
such application either (a) afford to such applicants access to a list of the
names and addresses of all Shareholders as recorded on the books of the Trust;
or (b) inform such applicants as to the approximate number of Shareholders of
record, and the approximate cost of mailing to them the proposed communication
and form of request. If the Trustees elect to follow the course specified in
(b) above, the Trustees, upon the written request of such applicants,
accompanied by a tender of the material to be mailed and of the reasonable
expenses of mailing, shall, with reasonable promptness, mail such material to
all Shareholders of record, unless within five business days after such tender
the Trustees mail to such applicants and file with the Commission, together with
a copy of the material to be mailed, a written statement signed by at least a
majority of the Trustees to the effect that in their opinion either such
material contains untrue statements of fact or omits to state facts necessary to
make the statements contained therein not misleading, or would be in violation
of applicable law, and specifying the basis of such opinion.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. FILING. This Declaration, as amended, and any subsequent
amendment hereto shall be filed in the office of the Secretary of The
Commonwealth of Massachusetts and in such other place or places as may be
required under the laws of The Commonwealth 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 11.2. 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 Commonwealth.
SECTION 11.3. 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 11.4. 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: (i) the number or identity of Trustees or
Shareholders, (ii) the due authorization of the execution of any instrument or
writing, (iii) the form of any vote passed at a meeting of Trustees or
Shareholders, (iv) the fact that the number of Trustees or Shareholders present
at any meeting or executing any written instrument satisfies the requirements of
this Declaration, (v) the form of any By-Laws adopted by or the identity of any
officers elected by the Trustees, or (vi) 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 11.5. 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 of 1986, as amended, 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.
(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.
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IN WITNESS WHEREOF, the undersigned have executed this instrument this 1st
day of September, 1993.
JEFFREY L. SHAMES
-------------------------------
Jeffrey L. Shames
as Trustee and not individually
500 Boylston Street
Boston, Massachusetts
ARNOLD D. SCOTT
-------------------------------
Arnold D. Scott
as Trustee and not individually
500 Boylston Street
Boston, Massachusetts
JAMES R. BORDEWICK, JR.
-------------------------------
James R. Bordewick, Jr.
as Trustee and not Individually
500 Boylston Street
Boston, Massachusetts
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COMMONWEALTH OF MASSACHUSETTS
SUFFOLK, SS. BOSTON, MASSACHUSETTS
September 1, 1993
Then personally appeared the above-named Jeffrey L. Shames, Arnold D. Scott
and James R. Bordewick, Jr., and who severally acknowledged the foregoing
instrument to be their free act and deed.
Before me,
LISA SANBORN
-------------
Notary Public
My commission expires: 2/14/97
<PAGE>
EXHIBIT 1b
MFS UNION STANDARD TRUST
AMENDMENT TO THE DECLARATION OF TRUST
Establishment and Designation
of Series of Shares of Beneficial Interest
(without par value)
Pursuant to Section 6.9 of the Declaration of Trust dated August 31, 1993,
as amended (the "Declaration of Trust"), of MFS Union Standard Trust (the
"Trust"), the Trustees of the Trust hereby divide the Shares (as defined in the
Declaration of Trust) into two separate series, each series to have the
following special and relative rights:
1. The series shall be designated:
(i) MFS Union Standard Equity Fund
(ii) MFS Union Standard Fixed Income Fund
2. The series shall be authorized to invest in cash, securities,
instruments and other property as from time to time described in the
Trust's then currently effective registration statement under the
Securities Act of 1933 to the extent pertaining to the offering of
Shares of such series. Each Share of each series shall be redeemable,
shall be entitled to one vote or fraction thereof in respect of a
fractional share on matters on which Shares of that series shall be
entitled to vote, shall represent a pro rata beneficial interest in the
assets allocated or belonging to the series, and shall be entitled to
receive its pro rata share of the net assets of the series upon
liquidation of the series, all as provided in Section 6.9 of the
Declaration of Trust.
3. Subject to the provisions of Section 6.9 and Article IX of the
Declaration of Trust, the Trustees (including any successor Trustees)
shall have the right at any time and from time to time to reallocate
assets and expenses or to change the designation of any series now or
hereafter created, or to otherwise change the special and relative
rights of any such series.
<PAGE>
Pursuant to Section 6.9(h) of the Declaration of Trust, this establishment
and designation of series of Shares shall be effective upon the execution of a
majority of the Trustees of the Trust.
IN WITNESS WHEREOF, a majority of the Trustees of the Trust have executed
this establishment and designation, in one or more counterparts, all
constituting a single instrument, as an instrument under seal in The
Commonwealth of Massachusetts, as of this 1st day of September, 1993.
JEFFREY L. SHAMES
---------------------------
Jeffrey L. Shames
ARNOLD D. SCOTT
---------------------------
Arnold D. Scott
JAMES R. BORDEWICK, JR.
---------------------------
James R. Bordewick, Jr.
<PAGE>
EXHIBIT 1c
MFS UNION STANDARD TRUST
AMENDMENT
TO DECLARATION OF TRUST
ABOLISHMENT OF MFS UNION STANDARD FIXED INCOME FUND,
A SERIES OF SHARES OF BENEFICIAL INTEREST
(WITHOUT PAR VALUE)
AND
ESTABLISHMENT AND DESIGNATION
OF MFS UNION STANDARD RESEARCH FUND,
A SERIES OF SHARES OF BENEFICIAL INTEREST
(WITHOUT PAR VALUE)
Pursuant to Sections 6.9(h) and 9.3 of the Declaration of Trust dated
September 1, 1993, as amended (the "Declaration"), of MFS Union Standard Trust
(the "Trust"), the Trustees of the Trust hereby abolish the MFS Union Standard
Fixed Income Fund, a series of Shares (as defined in the Declaration)
established and designated by the Trustees of the Trust by an amendment to the
Declaration dated September 1, 1993.
Pursuant to Sections 6.9 and 9.3 of the Declaration, the Trustees of the
Trust hereby establish and designate a new series of Shares (as defined in the
Declaration), such series to have the following special and relative rights:
1. The new series shall be designated:
MFS Union Standard Research Fund
2. The series shall be authorized to invest in cash, securities,
instruments and other property as from time to time described in the
Trust's then currently effective registration statement under the
Securities Act of 1933 to the extent pertaining to the offering of
Shares of the series. Each Share of the series shall be redeemable,
shall be entitled to one vote or fraction thereof in respect of a
fractional share on matters on which Shares of the series shall be
entitled to vote, shall represent a pro rata beneficial interest in
the assets allocated or belonging to the series, and shall be
entitled to receive its pro rata share of the net assets of the
series upon liquidation of the series, all as provided in Section
6.9 of the Declaration.
3. Shareholders of the series shall vote separately as a class on any
matter to the extent required by, and any matter shall be deemed to
have been effectively acted upon with respect to the series as
provided in, Rule 18f-2, as from time to time in effect, under the
Investment Company Act of 1940, as amended, or any successor rule,
and by the Declaration.
<PAGE>
4. The assets and liabilities of the Trust shall be allocated among the
previously established and existing series of the Trust and this
series as set forth in Section 6.9 of the Declaration.
5. Subject to the provisions of Section 6.9 and Article IX of the
Declaration, the Trustees (including any successor Trustees) shall
have the right at any time and from time to time to reallocate
assets and expenses or to change the designation of any series now
or hereafter created, or to otherwise change the special and
relative rights of any such series.
Pursuant to Section 6.9(h) of the Declaration, the abolition of the MFS
Union Standard Fixed Income Fund and the establishment and designation of the
MFS Union Standard Research Fund shall be effective upon the execution of this
instrument by of a majority of the Trustees of the Trust.
IN WITNESS WHEREOF, a majority of the Trustees of the Trust have executed
this certificate of amendment to the Declaration, in one or more counterparts,
all constituting a single instrument, as an instrument under seal in The
Commonwealth of Massachusetts, as of this 29th day of August, 1995.
A. KEITH BRODKIN
-------------------------------
A. Keith Brodkin, Trustee
-------------------------------
Nelson J. Darling, Jr., Trustee
WILLIAM R. GUTOW
-------------------------------
William R. Gutow, Trustee
<PAGE>
EXHIBIT 2
BY-LAWS
OF
MFS UNION STANDARD TRUST
SEPTEMBER 1, 1993
<PAGE>
BY-LAWS
OF
MFS UNION STANDARD TRUST
ARTICLE I
DEFINITIONS
The terms "COMMISSION", "DECLARATION", "DISTRIBUTOR", "INVESTMENT ADVISER",
"MAJORITY SHAREHOLDER VOTE", "1940 ACT", "SHAREHOLDER", "SHARES", "TRANSFER
AGENT", "TRUST", "TRUST PROPERTY" and "TRUSTEES" have the respective meanings
given them in the Declaration of Trust of MFS Union Standard Trust,
dated September 1, 1993, as amended from time to time.
ARTICLE II
OFFICES
SECTION 1. PRINCIPAL OFFICE. Until changed by the Trustees, the principal
office of the Trust in The Commonwealth of Massachusetts shall be in the City of
Boston, County of Suffolk.
SECTION 2. OTHER OFFICES. The Trust may have offices in such other places
without as well as within the Commonwealth as the Trustees may from time to time
determine.
ARTICLE III
SHAREHOLDERS
SECTION 1. MEETINGS. Meetings of the Shareholders may be called at any
time by a majority of the Trustees and shall be called by any Trustee upon
written request of Shareholders holding in the aggregate not less than ten
percent (10%) of the outstanding Shares of the Trust having voting rights, if
shareholders of all series are required under the Declaration to vote in the
aggregate and not by individual series at such meeting, or of any series or
class if shareholders of such series or class are entitled under the Declaration
to vote by individual series or class, such request specifying the purpose or
purposes for which such meeting is to be called. Any such meeting shall be
held within or without The Commonwealth of Massachusetts on such day and at such
time as the Trustees shall designate. The holders of a majority of outstanding
Shares
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<PAGE>
entitled to vote present in person or by proxy shall constitute a quorum at any
meeting of the Shareholders, except that where any provision of law, the
Declaration or these By-laws permit or require that holders of any series shall
vote as a series, then a majority of the aggregate number of Shares of that
series entitled to vote shall be necessary to constitute a quorum for the
transaction of business by that series. In the absence of a quorum, a majority
of outstanding Shares entitled to vote present in person or by proxy may adjourn
the meeting from time to time until a quorum shall be present.
SECTION 2. NOTICE OF MEETINGS. Notice of all meetings of Shareholders,
stating the time, place and purposes of the meeting, shall be given by the
Trustees by mail to each Shareholder entitled to vote at such meeting at his
address as recorded on the register of the Trust, mailed at least (ten) 10 days
and not more than (sixty) 60 days before the meeting. Only the business stated
in the notice of the meeting shall be considered at such meeting. Any adjourned
meeting may be held as adjourned without further notice. No notice need be
given to any Shareholder who shall have failed to inform the Trust of his
current address or if a written waiver of notice, executed before or after the
meeting by the Shareholder or his attorney thereunto authorized, is filed with
the records of the meeting.
SECTION 3. RECORD DATE FOR MEETINGS. For the purpose of determining the
Shareholders who are entitled to notice of and to vote at any meeting, or to
participate in any distribution, or for the purpose of any other action, the
Trustees may from time to time close the transfer books for such period, not
exceeding thirty (30) days, as the Trustees may determine; or without closing
the transfer books the Trustees may fix a date not more than sixty (60) days
prior to the date of any meeting of Shareholders or distribution or other action
as a record date for the determination of the persons to be treated as
Shareholders of record for such purpose.
SECTION 4. PROXIES. At any meeting of Shareholders, any holder of Shares
entitled to vote thereat may vote by proxy, provided that no proxy shall be
voted at any meeting unless it shall have been placed on file with the Clerk, or
with such other officer or agent of the Trust as the Clerk may direct, for
verification prior to the time at which such vote shall be taken. Pursuant to a
vote of a majority of the Trustees, proxies may be solicited in the name of one
or more Trustees or one or more of the officers of the Trust. Only Shareholders
of record shall be entitled to vote. Each full Share shall be entitled to one
vote and fractional Shares shall be entitled to a vote of such fraction. When
any Share is held jointly by several persons, any one of them may vote at any
meeting in person or by proxy in respect of such Share, but if more than one of
them shall be present at such meeting in person or by proxy, and such joint
owners or their proxies so present disagree as to any vote to be cast, such vote
shall not be received in respect of such Share. A proxy purporting to be
executed by or on behalf of a Shareholder shall be deemed valid unless
challenged at or prior to its exercise, and the burden of proving invalidity
shall rest on the challenger. The placing of a Shareholder's name on a proxy
pursuant to a telephonic or electronically transmitted instructions obtained
pursuant to procedures reasonably designed to verify that such instructions have
been authorized by such Shareholder shall constitute execution of such proxy by
or on behalf of such Shareholder. If the holder of any such Share is a minor or
a person of unsound mind, and subject to guardianship or to the legal control of
any other person as regards the charge or management of such Share, he may vote
by his guardian or such other person appointed or having such control, and such
vote may be given in person or by proxy.
2
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SECTION 5. INSPECTION OF RECORDS. The records of the Trust shall be open
to inspection by Shareholders to the same extent as is permitted shareholders of
a Massachusetts business corporation.
SECTION 6. ACTION WITHOUT MEETING. Any action which may be taken by
Shareholders may be taken without a meeting if a majority of Shareholders
entitled to vote on the matter (or such larger proportion thereof as shall be
required by law, the Declaration or these By-Laws for approval of such matter)
consent to the action in writing and the written consents are filed with the
records of the meetings of Shareholders. Such consent shall be treated for all
purposes as a vote taken at a meeting of Shareholders.
ARTICLE IV
TRUSTEES
SECTION 1. MEETINGS OF THE TRUSTEES. The Trustees may in their discretion
provide for regular or stated meetings of the Trustees. Notice of regular or
stated meetings need not be given. Meetings of the Trustees other than regular
or stated meetings shall be held whenever called by the Chairman or by any one
of the Trustees at the time being in office. Notice of the time and place of
each meeting other than regular or stated meetings shall be given by the
Secretary or an Assistant Secretary, or the Clerk or an Assistant Clerk or by
the officer or Trustee calling the meeting and shall be mailed to each Trustee
at least two days before the meeting, or shall be telegraphed, cabled, or
wirelessed or sent by facsimile or other electronic means to each Trustee at his
business address, or personally delivered to him at least one day before the
meeting. Such notice may, however, be waived by any Trustee. Notice of a
meeting need not be given to any Trustee if a written waiver of notice, executed
by him before or after the meeting, is filed with the records of the meeting, or
to any Trustee who attends the meeting without protesting prior thereto or at
its commencement the lack of notice to him. A notice or waiver of notice need
not specify the purpose of any meeting. The Trustees may meet by means of a
telephone conference circuit or similar communications equipment by means of
which all persons participating in the meeting can hear each other, which
telephone conference meeting shall be deemed to have been held at a place
designated by the Trustees at the meeting. Participation in a telephone
conference meeting shall constitute presence in person at such meeting. Any
action required or permitted to be taken at any meeting of the Trustees may be
taken by the Trustees without a meeting if all the Trustees consent to the
action in writing and the written consents are filed with the records of the
Trustees' meetings. Such consents shall be treated as a vote for all purposes.
SECTION 2. QUORUM AND MANNER OF ACTING. A majority of the Trustees shall
be present in person at any regular or special meeting of the Trustees in order
to constitute a quorum for the transaction of business at such meeting and
(except as otherwise required by law, the Declaration or these By-Laws) the act
of a majority of the Trustees present at any such meeting, at which a quorum is
present, shall be the act of the Trustees. In the absence of a quorum, a
majority of the
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<PAGE>
Trustees present may adjourn the meeting from time to time until a quorum shall
be present. Notice of an adjourned meeting need not be given.
ARTICLE V
COMMITTEES AND ADVISORY BOARD
SECTION 1. EXECUTIVE AND OTHER COMMITTEES. The Trustees by vote of a
majority of all the Trustees may elect from their own number an Executive
Committee to consist of not less than three (3) Trustees to hold office at the
pleasure of the Trustees which shall have the power to conduct the current and
ordinary business of the Trust while the Trustees are not in session, including
the purchase and sale of securities and the designation of securities to be
delivered upon redemption of Shares of the Trust, and such other powers of the
Trustees as the Trustees may, from time to time, delegate to the Executive
Committee except those powers which by law, the Declaration or these By-Laws
they are prohibited from delegating. The Trustees may also elect from their own
number other Committees from time to time, the number composing such Committees,
the powers conferred upon the same (subject to the same limitations as with
respect to the Executive Committee) and the term of membership on such
Committees to be determined by the Trustees. The Trustees may designate a
chairman of any such Committee. In the absence of such designation a Committee
may elect its own Chairman.
SECTION 2. MEETING, QUORUM AND MANNER OF ACTING. The Trustees may (i)
provide for stated meetings of any Committee, (ii) specify the manner of calling
and notice required for special meetings of any Committee, (iii) specify the
number of members of a Committee required to constitute a quorum and the number
of members of a Committee required to exercise specified powers delegated to
such Committee, (iv) authorize the making of decisions to exercise specified
powers by written assent of the requisite number of members of a Committee
without a meeting, and (v) authorize the members of a Committee to meet by means
of a telephone conference circuit.
The Executive Committee shall keep regular minutes of its meetings and
records of decisions taken without a meeting and cause them to be recorded in a
book designated for that purpose and kept in the office of the Trust.
SECTION 3. ADVISORY BOARD. The Trustees may appoint an Advisory Board to
consist in the first instance of not less than three (3) members. Members of
such Advisory Board shall not be Trustees or officers and need not be
Shareholders. A member of such Advisory Board shall hold office for such period
as the Trustees may by resolution provide. Any member of such board may resign
therefrom by a written instrument signed by him which shall take effect upon
delivery to the Trustees. The Advisory Board shall have no legal powers and
shall not perform the functions of Trustees in any manner, such Advisory Board
being intended merely to act in an advisory capacity. Such Advisory Board shall
meet at such times and upon such notice as the Trustees may by resolution
provide.
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ARTICLE VI
OFFICERS
SECTION 1. GENERAL PROVISIONS. The officers of the Trust shall be a
Chairman, a President, a Treasurer and a Clerk, who shall be elected by the
Trustees. The Trustees may elect or appoint such other officers or agents as
the business of the Trust may require, including one or more Vice Presidents, a
Secretary and one or more Assistant Secretaries, one or more Assistant
Treasurers, and one or more Assistant Clerks. The Trustees may delegate to any
officer or committee the power to appoint any subordinate officers or agents.
SECTION 2. TERM OF OFFICE AND QUALIFICATIONS. Except as otherwise
provided by law, the Declaration or these By-Laws, the Chairman, the President,
the Treasurer and the Secretary shall hold office until his respective successor
shall have been duly elected and qualified, and all other officers shall hold
office at the pleasure of the Trustees. The Clerk and Treasurer or the Clerk
and Secretary or all three may be the same person. A Vice President and the
Treasurer or a Vice President and the Clerk and the Secretary may be the same
person, but the offices of Vice President, Clerk and Treasurer shall not be held
by the same person. Except as above provided, any two offices may be held by
the same person. Any officer may be, but none need be, a Trustee or
Shareholder.
SECTION 3. REMOVAL. The Trustees, at any regular or special meeting of
the Trustees, may remove any officer with or without cause by a vote of a
majority of the Trustees. Any officer or agent appointed by any officer or
committee may be removed with or without cause by such appointing officer or
committee.
SECTION 4. POWERS AND DUTIES OF THE CHAIRMAN. The Chairman may call
meetings of the Trustees and of any Committee thereof when he deems it necessary
and shall preside at all meetings of the Shareholders. Subject to the control
of the Trustees and any Committees of the Trustees, the Chairman shall at all
times exercise a general supervision and direction over the affairs of the
Trust. The Chairman shall have the power to employ attorneys and counsel for
the Trust and to employ such subordinate officers, agents, clerks and employees
as he may find necessary to transact the business of the Trust. The Chairman
shall also have the power to grant, issue, execute or sign such powers of
attorney, proxies or other documents as may be deemed advisable or necessary in
furtherance of the interests of the Trust. The Chairman shall have such other
powers and duties as, from time to time, may be conferred upon or assigned to
him by the Trustees.
SECTION 5. POWERS AND DUTIES OF THE PRESIDENT. In the absence or
disability of the Chairman, the President shall perform all the duties and may
exercise any of the powers of the Chairman, subject to the control of the
Trustees. The President shall perform such other duties as may be assigned to
him from time to time by the Trustees or the Chairman.
SECTION 6. POWERS AND DUTIES OF VICE PRESIDENTS. In the absence or
disability of the President, the Vice President or, if there be more than one
Vice President, any Vice President designated by the Trustees shall perform all
the duties and may exercise any of the powers of the
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President, subject to the control of the Trustees. Each Vice President shall
perform such other duties as may be assigned to him from time to time by the
Trustees or the President.
SECTION 7. POWERS AND DUTIES OF THE TREASURER. The Treasurer shall be the
principal financial and accounting officer of the Trust. The Treasurer shall
deliver all funds of the Trust which may come into his hands to such custodian
as the Trustees may employ pursuant to Article X hereof. The Treasurer shall
render a statement of condition of the finances of the Trust to the Trustees as
often as they shall require the same and shall in general perform all the duties
incident to the office of Treasurer and such other duties as from time to time
may be assigned to him by the Trustees. The Treasurer shall give a bond for the
faithful discharge of his duties, if required to do so by the Trustees, in such
sum and with such surety or sureties as the Trustees shall require.
SECTION 8. POWERS AND DUTIES OF THE CLERK. The Clerk shall keep the
minutes of all meetings of the Shareholders in proper books provided for that
purpose; he shall have custody of the seal of the Trust; he shall have charge
of the Share transfer books, lists and records unless the same are in the charge
of the Transfer Agent. He or the Secretary shall attend to the giving and
serving of all notices by the Trust in accordance with the provisions of these
By-Laws and as required by law; and subject to these By-Laws, he shall in
general perform all duties incident to the office of Clerk and such other duties
as from time to time may be assigned to him by the Trustees.
SECTION 9. POWERS AND DUTIES OF THE SECRETARY. The Secretary, if any,
shall keep the minutes of all meetings of the Trustees. He shall perform such
other duties and have such other powers in addition to those specified in these
By-Laws as the Trustees shall from time to time designate. If there be no
Secretary or Assistant Secretary, the Clerk shall perform the duties of
Secretary.
SECTION 10. POWERS AND DUTIES OF ASSISTANT TREASURERS. In the absence or
disability of the Treasurer, any Assistant Treasurer designated by the Trustees
shall perform all the duties, and may exercise any of the powers, of the
Treasurer. Each Assistant Treasurer shall perform such other duties as from
time to time may be assigned to him by the Trustees. Each Assistant Treasurer
shall give a bond for the faithful discharge of his duties, if required to do so
by the Trustees, in such sum and with such surety or sureties as the Trustees
shall require.
SECTION 11. POWERS AND DUTIES OF ASSISTANT CLERKS. In the absence or
disability of the Clerk, any Assistant Clerk designated by the Trustees shall
perform all the duties, and may exercise any of the powers, of the Clerk. The
Assistant Clerks shall perform such other duties as from time to time may be
assigned to them by the Trustees.
SECTION 12. POWERS AND DUTIES OF ASSISTANT SECRETARIES. In the absence or
disability of the Secretary, any Assistant Secretary designated by the Trustees
shall perform all of the duties, and may exercise any of the powers, of the
Secretary. The Assistant Secretaries shall perform such other duties as from
time to time may be assigned to them by the Trustees.
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SECTION 13. COMPENSATION OF OFFICERS AND TRUSTEES AND MEMBERS OF THE
ADVISORY BOARD. Subject to any applicable law or provision of the Declaration,
the compensation of the officers and Trustees and members of the Advisory Board
shall be fixed from time to time by the Trustees or, in the case of officers, by
any Committee or officer upon whom such power may be conferred by the Trustees.
No officer shall be prevented from receiving such compensation as such officer
by reason of the fact that he is also a Trustee.
ARTICLE VII
FISCAL YEAR
The fiscal year of the Trust shall begin on the first day of October in
each year and shall end on the last day of September in the succeeding year,
provided, however, that the Trustees may from time to time change the fiscal
year.
ARTICLE VIII
SEAL
The Trustees shall adopt a seal which shall be in such form and shall have
such inscription thereon as the Trustees may from time to time prescribe.
ARTICLE IX
WAIVERS OF NOTICE
Whenever any notice is required to be given by law, the Declaration or
these By-Laws, a waiver thereof in writing, signed by the person or persons
entitled to such notice, whether before or after the time stated therein, shall
be deemed equivalent thereto. A notice shall be deemed to have been
telegraphed, cabled or wirelessed or sent by facsimile or other electronic means
for the purposes of these By-Laws when it has been delivered to a representative
of any telegraph, cable or wireless company with instruction that it be
telegraphed, cabled or wirelessed or when a confirmation of such facsimile
having been sent, or a confirmation that such electronic means has sent the
notice being transmitted, is generated. Any notice shall be deemed to be given
at the time when the same shall be mailed, telegraphed, cabled or wirelessed or
when sent by facsimile or other electronic means.
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ARTICLE X
CUSTODIAN
SECTION 1. APPOINTMENT AND DUTIES. The Trustees shall at all times employ
a bank or trust company having a capital, surplus and undivided profits of at
least five million dollars ($5,000,000.00) as custodian with authority as its
agent, but subject to such restrictions, limitations and other requirements, if
any, as may be contained in the Declaration, these By-Laws and the 1940 Act:
(i) to hold the securities owned by the Trust and deliver the same upon
written order;
(ii) to receive and issue receipts for any monies due to the Trust and
deposit the same in ts own banking department or elsewhere as the
Trustees may direct;
(iii) to disburse such funds upon orders or vouchers;
(iv) if authorized by the Trustees, to keep the books and accounts of the
Trust and furnish clerical and accounting services; and
(v) if authorized to do so by the Trustees, to compute the net income of
the Trust;
all upon such basis of compensation as may be agreed upon between the Trustees
and the custodian. If so directed by a Majority Shareholder Vote, the custodian
shall deliver and pay over all Trust Property held by it as specified in such
vote.
The Trustees may also authorize the custodian to employ one or more sub-
custodians from time to time to perform such of the acts and services of the
custodian and upon such terms and conditions as may be agreed upon between the
custodian and such sub-custodian and approved by the Trustees, provided that in
every case such sub-custodian shall be a bank or trust company organized under
the laws of the United States or one of the states thereof and having capital,
surplus and undivided profits of at least five million dollars ($5,000,000.00)
or such foreign banks and securities depositories as meet the requirements of
applicable provisions of the 1940 Act or the rules and regulations thereunder.
SECTION 2. CENTRAL CERTIFICATE SYSTEM. Subject to such rules, regulations
and orders as the Commission may adopt, the Trustees may direct the custodian to
deposit all or any part of the securities owned by the Trust in a system for the
central handling of securities established by a national securities exchange or
a national securities association registered with the Commission under the
Securities Exchange Act of 1934, or such other person as may be permitted by the
Commission, or otherwise in accordance with the 1940 Act, pursuant to which
system all securities of any particular class or series of any issuer deposited
within the system are treated as fungible and may be transferred or pledged by
bookkeeping entry without physical delivery of such securities, provided that
all such deposits shall be subject to withdrawal only upon the order of the
Trust or its custodian.
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SECTION 3. ACCEPTANCE OF RECEIPTS IN LIEU OF CERTIFICATES. Subject to
such rules, regulations and orders as the Commission may adopt, the Trustees may
direct the custodian to accept written receipts or other written evidences
indicating purchases of securities held in book-entry form in the Federal
Reserve System in accordance with regulations promulgated by the Board of
Governors of the Federal Reserve System and the local Federal Reserve Banks in
lieu of receipt of certificates representing such securities.
SECTION 4. PROVISIONS OF CUSTODIAN CONTRACT. The following provisions
shall apply to the employment of a custodian pursuant to this Article X and to
any contract entered into with the custodian so employed:
(a) The Trustees shall cause to be delivered to the custodian all
securities owned by the Trust or to which it may become entitled, and shall
order the same to be delivered by the custodian only upon completion of a sale,
exchange, transfer, pledge, or other disposition thereof, and upon receipt by
the custodian of the consideration therefor or a certificate of deposit or a
receipt of an issuer or of its Transfer Agent, all as the Trustees may generally
or from time to time require or approve, or to a successor custodian; and the
Trustees shall cause all funds owned by the Trust or to which it may become
entitled to be paid to the custodian, and shall order the same disbursed only
for investment against delivery of the securities acquired, or in payment of
expenses, including management compensation, and liabilities of the Trust,
including distributions to Shareholders, or to a successor custodian; provided,
however, that nothing herein shall prevent delivery of securities for
examination to the broker selling the same in accord with the "street delivery"
custom whereby such securities are delivered to such broker in exchange for a
delivery receipt exchanged on the same day for an uncertified check of such
broker to be presented on the same day for certification.
(b) In case of the resignation, removal or inability to serve of any such
custodian, the Trust shall promptly appoint another bank or trust company
meeting the requirements of this Article X as successor custodian. The
agreement with the custodian shall provide that the retiring custodian shall,
upon receipt of notice of such appointment, deliver the funds and property of
the Trust in its possession to and only to such successor, and that pending
appointment of a successor custodian, or a vote of the Shareholders to function
without a custodian, the custodian shall not deliver funds and property of the
Trust to the Trust, but may deliver all or any part of them to a bank or trust
company doing business in Boston, Massachusetts, of its own selection, having an
aggregate capital, surplus and undivided profits (as shown in its last published
report) of at least $5,000,000, as the property of the Trust to be held under
terms similar to those on which they were held by the retiring custodian.
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ARTICLE XI
SALE OF SHARES OF THE TRUST
The Trustees may from time to time issue and sell or cause to be issued and
sold Shares for cash or other property, which shall in every case be paid or
delivered to the Custodian as agent of the Trust before the delivery of any
certificate for such shares. The Shares, including additional Shares which may
have been repurchased by the Trust (herein sometimes referred to as "treasury
shares"), may not be sold at a price less than the net asset value thereof (as
defined in Article XII hereof) determined by or on behalf of the Trustees next
after the sale is made or at some later time after such sale.
No Shares need be offered to existing Shareholders before being offered to
others. No Shares shall be sold by the Trust (although Shares previously
contracted to be sold may be issued upon payment therefor) during any period
when the determination of net asset value is suspended by declaration of the
Trustees pursuant to the provisions of Article XII hereof. In connection with
the acquisition by merger or otherwise of all or substantially all the assets of
an investment company (whether a regulated or private investment company or a
personal holding company), the Trustees may issue or cause to be issued Shares
and accept in payment therefor such assets at not more than market value in lieu
of cash, notwithstanding that the federal income tax basis to the Trust of any
assets so acquired may be less than the market value, provided that such assets
are of the character in which the Trustees are permitted to invest the funds of
the Trust.
The Trustees, in their sole discretion, may cause the Trust to redeem all
of the Shares of the Trust held by any Shareholder if the value of such Shares
is less than a minimum amount established from time to time by the Trustees.
ARTICLE XII
NET ASSET VALUE OF SHARES
SECTION 1. TIME OF DETERMINATION. The net asset value of each Share
outstanding shall be determined by the Trustees on each business day (which term
shall, wherever it appears in these By-Laws, be deemed to mean each day when the
New York Stock Exchange is open for trading) as of the close of regular trading
on the New York Stock Exchange. The power and duty to determine net asset value
may be delegated by the Trustees from time to time to one or more of the
Trustees or officers of the Trust, to the other party to any contract entered
into pursuant to Section 4.1 of Article IV of the Declaration, or to the
custodian or a transfer agent. The Trustees may also determine or cause to be
determined the net asset value as of any particular time in addition to the
closing time of each business day. Such additional or interim determination may
be made either by appraisal or by calculation or estimate. Any such calculation
or estimate shall be based on changes in the market value of representative or
selected securities or on changes in recognized market averages since the last
closing appraisal, and made in a manner which in the opinion of the Trustees
will fairly reflect the changes in the
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net asset value. At any time when the New York Stock Exchange is closed (other
than customary weekend and holiday closings), the Trustees may cause the net
asset value to be determined by appraising all securities at last sale prices,
or at not more than the current asked nor less than the current bid prices, in
the over-the-counter or other markets, and all other assets at fair value in the
best judgment of the Trustees, and otherwise proceeding as above stated. For
the purposes of Article VII of the Declaration and Articles XI and XII hereof,
any reference to the time at which a determination of net asset value is made
shall mean the time as of which the determination is made.
SECTION 2. SUSPENSION OF DETERMINATION. The Trustees may declare a
suspension of the determination of net asset value to the extent permitted by
the 1940 Act and rules, regulations and orders promulgated by the Commission
thereunder.
SECTION 3. COMPUTATION. The net asset value of each Share of any series
as of any particular time shall be the quotient (adjusted to the nearer cent)
obtained by dividing the value, as of such time, of the net assets of the Trust
allocated or belonging to such series (I.E., the value of the assets of the
Trust allocated or belonging to such series less the liabilities of the Trust
attributable to such series exclusive of capital and surplus) by the total
number of Shares of such series outstanding (exclusive of treasury shares) at
such time. In determining the net asset value of each share of any series:
A. Assets allocated or belonging to, and liabilities attributable to,
such series shall be determined as provided in Section 6.9 of the Declaration.
B. The assets of the Trust shall be deemed to include (a) all cash on
hand, on deposit or on call, including any interest accrued thereon, (b) all
bonds, debentures, bills and notes and accounts receivable and other evidences
of indebtedness, (c) all shares of stock, subscription rights, warrants, and
other securities, other than its own Shares, (d) all stock and cash dividends or
distributions receivable by the Trust which have been declared and are ex-
dividend to shareholders of record at or before the time as of which the net
asset value is being determined, (e) all interest accrued on any interest-
bearing securities owned by the Trust, and (f) all other property of every kind
and nature including prepaid expenses, the value of such assets to be determined
as follows:
(i) The value of any cash on hand, on deposit or on call, bills and
notes and accounts receivable, prepaid expenses, cash dividends
and interest declared or accrued as aforesaid and not yet
received, shall be deemed to be the face amount thereof unless the
Trustees shall have determined that any such item is not worth the
face amount thereof, in which event the value thereof shall be
determined in good faith by or at the direction of the Trustees;
(ii) The value of any security which is listed or dealt in upon the
New York Stock Exchange or upon the American Stock Exchange shall
be determined by taking the latest sale price (or, lacking any
sales not less than the closing bid price nor more than the
closing asked price therefor) at the time as of which the net
asset value is being determined, all as reported by any report in
common use or
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authorized by the New York Stock Exchange or the American Stock
Exchange, as the case may be; provided, however, that prices on
such Exchanges need not be used to determine the value of debt
securities owned by the Trust if, in the opinion of the Trustees,
some other method would more accurately reflect the fair market
value of such debt securities;
(iii) The value of any security which is not listed or dealt in on
either of such Exchanges shall be determined in the manner
described in the next preceding paragraph if listed or dealt in on
any other Exchange;
(iv) The value of any security not listed or dealt in on any Exchange
and for which market quotations are readily available shall be
determined by taking not less than the closing bid price nor more
than the closing asked price therefor on the date as of which the
net asset value is being determined; and
(v) In the case of any security or other property for which no price
quotations are available as above provided, the value thereof
shall be determined from time to time in such manner as the
Trustees shall from time to time provide by resolution.
C. The liabilities of the Trust shall be deemed to include (a) all bills,
notes and accounts payable, (b) all administrative expenses payable and/or
accrued, (c) all contractual obligations for the payment of money or property,
including the amount of any unpaid dividends upon the Shares, declared to
Shareholders of record at or before the time as of which the net asset value is
being determined, (d) all reserves authorized or approved by the Trustees for
taxes or contingencies, and (e) all other liabilities of the Trust of whatsoever
kind and nature except liabilities represented by outstanding Shares and capital
surplus of the Trust.
D. For the purposes of this Article XII
(i) Shares sold shall be deemed to become outstanding immediately
after the close of business on the day on which the contract of
sale is made, and the sale price thereof (less commission, if
any, and less any stamp or other tax payable by the Trust in
connection with the issuance thereof) shall thereupon be deemed
an asset of the Trust.
(ii) Shares tendered for purchase by the Trust under Section 7.1 of
Article VII of the Declaration shall be deemed to be outstanding
at the close of business on the day as of which the purchase
price is determined, and thereafter they shall be deemed
treasury stock and, until paid, the price thereof shall be
deemed a liability of the Trust.
(iii) Credits and contractual obligations payable to the Trust in
foreign currency and liabilities and contractual obligations
payable by the Trust in foreign currency shall be taken at the
current cable rate of exchange as nearly as practicable at the
time as of which the net asset value is computed.
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(iv) Portfolio securities owned by the Trust which the Trustees or
their delegate shall, pursuant to Section 7.3 of Article VII of
the Declaration, have selected for distribution in redemption or
repurchase of Shares tendered to it pursuant to Section 7.1 of
Article VII of the Declaration at any time shall be included in
determining the price of such Shares, and thereafter neither
such securities nor such Shares shall be included in
determinations of net asset value pursuant to this Article XII.
The net asset value of each Share of any class of any series as of any
particular time shall be determined in a similar fashion as set forth above,
with such adjustments as the Trustees and officers of the Trust deem
appropriate.
ARTICLE XIII
DIVIDENDS AND DISTRIBUTIONS
SECTION 1. LIMITATIONS ON DISTRIBUTIONS. The total of distributions to
Shareholders of a particular series paid in respect of any one fiscal year,
subject to the exceptions noted below, shall, when and as declared by the
Trustees be approximately equal to the sum of (A) the net income, exclusive of
the profits or losses realized upon the sale of securities or other property, of
such series for such fiscal year, determined in accordance with generally
accepted accounting principles (which, if the Trustees so determine, may be
adjusted for net amounts included as such accrued net income in the price of
Shares of such series issued or repurchased), but if the net income of such
series exceeds the amount distributed by less than one cent per share
outstanding at the record date for the final dividend, the excess shall be
treated as distributable income of such series for the following fiscal year;
and (B), in the discretion of the Trustees, an additional amount which shall not
substantially exceed the excess of profits over losses on sales of securities or
other property allocated or belonging to such series for such fiscal year. The
decision of the Trustees as to what, in accordance with generally accepted
accounting principles, is income and what is principal shall be final, and
except as specifically provided herein the decision of the Trustees as to what
expenses and charges of the Trust shall be charged against principal and what
against income shall be final, all subject to any applicable provisions of the
1940 Act and rules, regulations and orders of the Commission promulgated
thereunder. For the purposes of the limitation imposed by this Section 1,
Shares issued pursuant to Section 2 of this Article XIII shall be valued at the
amount of cash which the Shareholders would have received if they had elected to
receive cash in lieu of such Shares.
Inasmuch as the computation of net income and gains for federal income tax
purposes may vary from the computation thereof on the books, the above
provisions shall be interpreted to give to the Trustees the power in their
discretion to distribute for any fiscal year as ordinary dividends and as
capital gains distributions, respectively, additional amounts sufficient to
enable the Trust to avoid or reduce liability for taxes. Any payment made to
Shareholders pursuant to clause (B) of this Section 1 shall be accompanied by a
written statement showing the source or sources of such payment, and the basis
of computation thereof.
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SECTION 2. DISTRIBUTIONS PAYABLE IN CASH OR SHARES. The Trustees shall
have power, to the fullest extent permitted by the laws of The Commonwealth of
Massachusetts but subject to the limitation as to cash distributions imposed by
Section 1 of this Article XIII, at any time or from time to time to declare and
cause to be paid distributions payable at the election of any Shareholder of any
series (whether exercised before or after the declaration of the distribution)
either in cash or in Shares of such series, provided that the sum of (i) the
cash distribution actually paid to any Shareholder and (ii) the net asset value
of the Shares which that Shareholder elects to receive, in effect at such time
at or after the election as the Trustees may specify, shall not exceed the full
amount of cash to which that Shareholder would be entitled if he elected to
receive only cash. In the case of a distribution payable in cash or Shares at
the election of a Shareholder, the Trustees may prescribe whether a Shareholder,
failing to express his election before a given time shall be deemed to have
elected to take Shares rather than cash, or to take cash rather then Shares, or
to take Shares with cash adjustment of fractions.
SECTION 3. STOCK DIVIDENDS. Anything in these By-Laws to the contrary
notwithstanding, the Trustees may at any time declare and distribute pro rata
among the Shareholders of any series a "stock dividend" out of either authorized
but unissued Shares of such series or treasury Shares of such series or both.
ARTICLE XIV
AMENDMENTS
These By-Laws, or any of them, may be altered, amended or repealed, or new
By-Laws may be adopted (a) by Majority Shareholder Vote, or (b) by the Trustees,
provided, however, that no By-Law may be amended, adopted or repealed by the
Trustees if such amendment, adoption or repeal requires, pursuant to law, the
Declaration or these By-Laws, a vote of the Shareholders.
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EXHIBIT 5a
INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT, dated as of this 8th day of December, 1993 by and
between MFS UNION STANDARD TRUST, a Massachusetts business trust (the "Trust")
on behalf of MFS UNION STANDARD EQUITY FUND, a series of the Trust (the "Fund"),
and Massachusetts Financial Services Company, a Delaware corporation (the
"Adviser").
WITNESSETH:
WHEREAS, the Trust is engaged in business as an open-end investment company
registered under the Investment Company Act of 1940; and
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:
ARTICLE 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 management 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 the Trust's Declaration
of Trust, dated September 1, 1993 and By-Laws, as amended from time to time
(respectively, the "Declaration" and the "By-Laws"), and to the provisions of
the Investment Company Act of 1940. 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 notice 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 instructions 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 most favorable
price by responsible brokerage firms at reasonably competitive commission rates.
In fulfilling this requirement the Adviser shall not be deemed to have acted
unlawfully or to have breached any duty, created by this Agreement or otherwise,
solely by reason of its having caused
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the Fund to pay a broker or dealer an amount of commission for effecting a
securities transaction in excess of the amount of commission another broker or
dealer would have charged for effecting that transaction, if the Adviser
determined in good faith that such amount of commission was reasonable in
relation to the value of the brokerage and research services provided by such
broker or dealer, viewed in terms of either that particular transaction or the
Adviser's overall responsibilities with respect to the Fund and to other clients
of the Adviser as to which the Adviser exercises investment discretion.
ARTICLE 2: ALLOCATION OF CHARGES AND EXPENSES. The Adviser shall furnish
at its own expense investment advisory and administrative services, office
space, equipment and clerical personnel necessary for servicing the investments
of the Fund and maintaining the Trust's 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 Trust, for Directors, officers and employees of the
Adviser to serve as Trustees, officers or agents of the Trust if duly elected or
appointed to such positions and subject to their individual consent and to any
limitations imposed by law. It is understood that the Trust 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 Trust, fees
and expenses of independent auditors, of legal counsel and of any transfer
agent, registrar or dividend disbursing agent of the Trust, expenses of
repurchasing and redeeming shares and servicing shareholder accounts, expenses
of preparing, printing and mailing stock certificates, prospectuses, periodic
reports, notices and proxy statements to shareholders and to governmental
officers and commissions, brokerage and other expenses connected with the
execution, recording and settlement of portfolio security transactions,
insurance premiums, fees and expenses of the custodian for all services to the
Trust, including safekeeping of funds and securities, keeping of books and
accounts and calculation of the net asset value of shares of the Fund, expenses
of shareholder meetings, and expenses relating to the issuance, registration and
qualification of shares of the Trust.
ARTICLE 3: COMPENSATION OF THE ADVISER. For the services to be rendered
and the facilities to be furnished as provided in Articles 1 and 2 above, the
Fund shall pay to the Adviser an investment advisory fee computed and paid
monthly at the annual rate of 0.65% of the Fund's average daily net assets.
The Adviser agrees to pay until December 31, 1998, expenses of the Trust
(except for fees paid under this Agreement or the Fund's Distribution Plan) such
that the Fund's aggregate operating expenses shall not exceed 1.00% per annum of
the average daily net assets of the Fund; PROVIDED, HOWEVER, that this
obligation may be terminated or revised at any time by the Adviser without the
consent of the Fund by notice in writing from the Adviser to the Fund, provided
that such termination or revision will not be effective with respect to the
fiscal year within which such notice is given. Such payments by the Adviser are
subject to reimbursement by the Fund, which will be accomplished by the payment
by the Fund of an expense reimbursement fee to the Adviser computed and paid
monthly at a percentage of the average daily net assets of the Fund for its then
current fiscal year, with a limitation that immediately after such payment the
aggregate operating expenses of the Fund would not exceed 1.00% of its average
daily net assets. This expense reimbursement terminates for the Fund on the
earlier of the date on which
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payments made thereunder by such Fund equal the prior payment of such
reimbursable expenses by the Adviser or December 31, 1998.
If the Adviser shall serve for less than the whole of any period specified
in this Article 3, the compensation to the Adviser shall be prorated.
ARTICLE 4: SPECIAL SERVICES. Should the Trust have occasion to request
the Adviser to perform services not herein contemplated or to request the
Adviser to arrange for the services of others, the Adviser will act for the
Trust upon request to the best of its ability, with compensation for the
Adviser's services to be agreed upon with respect to each such occasion as it
arises.
ARTICLE 5: COVENANTS OF THE ADVISER. The Adviser agrees that it will not
deal with itself, or with the Trustees of the Trust or the Underwriter as
principals in making purchases or sales of securities or other property for the
account of the Fund, will not take a long or short position in the shares of the
Fund except as provided by the Declaration, and will comply with all other
provisions of the Declaration and By-laws relative to the Adviser and its
Directors and officers.
ARTICLE 6: 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 6, the term "Adviser"
shall include Directors, officers and employees of the Adviser as well as the
corporation itself.
ARTICLE 7: ACTIVITIES OF THE ADVISER. The services of the Adviser to the
Trust are not to be deemed to be exclusive, the Adviser being free to render
services to others. The Adviser may permit other fund clients to use the words
"Massachusetts Financial" or "MFS" in their names. The Trust agrees that if the
Adviser shall for any reason no longer serve as the Adviser to the Trust, the
Trust and the Fund will each change its name so as to delete the words
"Massachusetts Financial" or "MFS". It is understood that Trustees, officers,
and shareholders of the Trust are or may be or become interested in the Adviser,
as Directors, officers, employees, or otherwise and that Directors, officers and
employees of the Adviser are or may become similarly interested in the Fund and
that the Adviser may be or become interested in the Fund as a shareholder or
otherwise.
ARTICLE 8: DURATION, TERMINATION AND AMENDMENTS OF THIS AGREEMENT. This
Agreement shall become effective on the date of its execution and shall govern
the relations between the parties hereto thereafter, and shall remain in force
until December 8,1995, on which date it will terminate unless its continuance
after December 8, 1995, is specifically approved at least annually (i) by the
vote of a majority of the Trustees of the Trust who are not interested persons
of the Trust or of the Adviser at a meeting specifically called for the purpose
of voting on such approval, and (ii) by the Trustees of the Trust, or by vote of
a majority of the outstanding voting securities of the Fund. The aforesaid
requirement that continuance of this Agreement be "specifically approved at
least annually" shall be construed in a manner consistent with the Investment
Company Act of 1940 and the Rules and Regulations thereunder.
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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, on not more than sixty days' nor less that 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 "vote of a majority of the outstanding voting securities,"
"assignment," "affiliated person," and "interested persons," when used in this
Agreement, shall have the respective meanings specified in the Investment
Company Act of 1940 and the Rules and Regulations thereunder, subject, however,
to such exemptions as my be granted by the Securities and Exchange Commission
under said Act.
ARTICLE 9: RECORD KEEPING. The Adviser will maintain records in a form
acceptable to the Fund and in compliance with the rules and regulations of the
Securities and Exchange Commission, including but not limited to records
required to be maintained by Section 31(a) of the Investment Company Act of 1940
and the rules thereunder, which at all times will be the property of the Fund
and will be available for inspection and use by the Fund.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered in their names and on their behalf by the undersigned, thereunto
duly authorized, and their respective seals to be hereto affixed, all as of the
day and year first written above. The undersigned Trustee of the Trust has
executed this Agreement not individually, but as Trustee under the Declaration
and the obligations of this Agreement are not binding upon any of the Trustees
or shareholders of the Trust, individually, but bind only the trust estate
applicable to the Fund.
MFS UNION STANDARD TRUST
on behalf of
MFS UNION STANDARD EQUITY FUND
By: A. KEITH BRODKIN
--------------------
A. Keith Brodkin
Chairman and Trustee
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By: JEFFREY L. SHAMES
--------------------
Jeffrey L. Shames
President
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EXHIBIT 5b
INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT, dated as of this 15th day of November, 1995 by
and between MFS UNION STANDARD TRUST, a Massachusetts business trust (the
"Trust") on behalf of MFS UNION STANDARD RESEARCH FUND, a series of the Trust
(the "Fund"), and Massachusetts Financial Services Company, a Delaware
corporation (the "Adviser").
WITNESSETH:
WHEREAS, the Trust is engaged in business as an open-end investment company
registered under the Investment Company Act of 1940; and
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:
ARTICLE 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 management 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 the Trust's Declaration
of Trust, dated September 1, 1993 and By-Laws, as amended from time to time
(respectively, the "Declaration" and the "By-Laws"), and to the provisions of
the Investment Company Act of 1940. 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 notice 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 instructions 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 most favorable
price by responsible brokerage firms at reasonably competitive commission rates.
In fulfilling this requirement the Adviser shall not be deemed to have acted
unlawfully or to have
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breached any duty, created by this Agreement or otherwise, solely by reason of
its having caused the Fund to pay a broker or dealer an amount of commission for
effecting a securities transaction in excess of the amount of commission another
broker or dealer would have charged for effecting that transaction, if the
Adviser determined in good faith that such amount of commission was reasonable
in relation to the value of the brokerage and research services provided by such
broker or dealer, viewed in terms of either that particular transaction or the
Adviser's overall responsibilities with respect to the Fund and to other clients
of the Adviser as to which the Adviser exercises investment discretion.
ARTICLE 2: ALLOCATION OF CHARGES AND EXPENSES. The Adviser shall furnish
at its own expense investment advisory and administrative services, office
space, equipment and clerical personnel necessary for servicing the investments
of the Fund and maintaining the Trust's 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 Trust, for Directors, officers and employees of the
Adviser to serve as Trustees, officers or agents of the Trust if duly elected or
appointed to such positions and subject to their individual consent and to any
limitations imposed by law. It is understood that the Trust 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 Trust, fees
and expenses of independent auditors, of legal counsel and of any transfer
agent, registrar or dividend disbursing agent of the Trust, expenses of
repurchasing and redeeming shares and servicing shareholder accounts, expenses
of preparing, printing and mailing stock certificates, prospectuses, periodic
reports, notices and proxy statements to shareholders and to governmental
officers and commissions, brokerage and other expenses connected with the
execution, recording and settlement of portfolio security transactions,
insurance premiums, fees and expenses of the custodian for all services to the
Trust, including safekeeping of funds and securities, keeping of books and
accounts and calculation of the net asset value of shares of the Fund, expenses
of shareholder meetings, and expenses relating to the issuance, registration and
qualification of shares of the Trust.
ARTICLE 3: COMPENSATION OF THE ADVISER. For the services to be rendered
and the facilities to be furnished as provided in Articles 1 and 2 above, the
Fund shall pay to the Adviser an investment advisory fee computed and paid
monthly at the annual rate of 0.60% of the Fund's average daily net assets.
The Adviser agrees to pay until December 31, 1998, expenses of the Trust
(except for fees paid under this Agreement or the Fund's Distribution Plan) such
that the Fund's aggregate operating expenses shall not exceed 1.00% per annum of
the average daily net assets of the Fund; PROVIDED, HOWEVER, that this
obligation may be terminated or revised at any time by the Adviser without the
consent of the Fund by notice in writing from the Adviser to the Fund, provided
that such termination or revision will not be effective with respect to the
fiscal year within which such notice is given. Such payments by the Adviser are
subject to reimbursement by the Fund, which will be accomplished by the payment
by the Fund of an expense reimbursement fee to the Adviser computed and paid
monthly at a percentage of the average daily net assets of the Fund for its then
current fiscal year, with a limitation that immediately after such payment the
aggregate operating expenses of the Fund would not exceed 1.00% of its average
daily net assets.
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This expense reimbursement terminates for the Fund on the earlier of the date on
which payments made thereunder by such Fund equal the prior payment of such
reimbursable expenses by the Adviser or December 31, 1998.
If the Adviser shall serve for less than the whole of any period specified
in this Article 3, the compensation to the Adviser shall be prorated.
ARTICLE 4: SPECIAL SERVICES. Should the Trust have occasion to request
the Adviser to perform services not herein contemplated or to request the
Adviser to arrange for the services of others, the Adviser will act for the
Trust upon request to the best of its ability, with compensation for the
Adviser's services to be agreed upon with respect to each such occasion as it
arises.
ARTICLE 5: COVENANTS OF THE ADVISER. The Adviser agrees that it will not
deal with itself, or with the Trustees of the Trust or the Underwriter as
principals in making purchases or sales of securities or other property for the
account of the Fund, will not take a long or short position in the shares of the
Fund except as provided by the Declaration, and will comply with all other
provisions of the Declaration and By-Laws relative to the Adviser and its
Directors and officers.
ARTICLE 6: 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.
ARTICLE 7: ACTIVITIES OF THE ADVISER. The services of the Adviser to the
Trust are not to be deemed to be exclusive, the Adviser being free to render
services to others. The Adviser may permit other fund clients to use the words
"Massachusetts Financial" or "MFS" in their names. The Trust agrees that if the
Adviser shall for any reason no longer serve as the Adviser to the Trust, the
Trust and the Fund will each change its name so as to delete the words
"Massachusetts Financial" or "MFS". It is understood that Trustees, officers,
and shareholders of the Trust are or may be or become interested in the Adviser,
as Directors, officers, employees, or otherwise and that Directors, officers and
employees of the Adviser are or may become similarly interested in the Fund and
that the Adviser may be or become interested in the Fund as a shareholder or
otherwise.
ARTICLE 8: DURATION, TERMINATION AND AMENDMENTS OF THIS AGREEMENT. This
Agreement shall become effective on the date of its execution and shall govern
the relations between the parties hereto thereafter, and shall remain in force
until November 15,1997, on which date it will terminate unless its continuance
after November 15, 1997, is specifically approved at least annually (i) by the
vote of a majority of the Trustees of the Trust who are not interested persons
of the Trust or of the Adviser at a meeting specifically called for the purpose
of voting on such approval, and (ii) by the Trustees of the Trust, or by vote of
a majority of the outstanding voting securities of the Fund. The aforesaid
requirement that continuance of this
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Agreement be "specifically approved at least annually" shall be construed in a
manner consistent with the Investment Company Act of 1940 and the Rules and
Regulations thereunder.
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, on not more than sixty days' nor less that 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.
ARTICLE 9: DEFINITIONS. The terms "vote of a majority of the outstanding
voting securities," "assignment," "affiliated person," and "interested persons,"
when used in this Agreement, shall have the respective meanings specified in the
Investment Company Act of 1940 and the Rules and Regulations thereunder,
subject, however, to such exemptions as my be granted by the Securities and
Exchange Commission under said Act.
ARTICLE 10: RECORD KEEPING. The Adviser will maintain records in a form
acceptable to the Fund and in compliance with the rules and regulations of the
Securities and Exchange Commission, including but not limited to records
required to be maintained by Section 31(a) of the Investment Company Act of 1940
and the rules thereunder, which at all times will be the property of the Fund
and will be available for inspection and use by the Fund.
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A copy of the Declaration is on file with the Secretary of State of The
Commonwealth of Massachusetts. The Adviser acknowledges that the obligations of
or arising out of this instrument are not binding upon any of the 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 hereunder. If this instrument is executed by the Trust
on behalf of one or more series of the Trust, the Adviser 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 instrument are
binding solely upon the assets or property of the series on whose behalf the
Trust has executed this instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered in their names and on their behalf by the undersigned, thereunto duly
authorized, and their respective seals to be hereto affixed, all as of the day
and year first written above. The undersigned officers of the Trust and the
Adviser have executed this Agreement not individually, but as officers of the
Trust and the Adviser, respectively.
MFS UNION STANDARD TRUST
on behalf of
MFS UNION STANDARD RESEARCH FUND,
one of its series
By:
-------------------------------------------
A. Keith Brodkin
Chairman and Trustee, and not individually
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By:
-------------------------------------------
Jeffrey L. Shames
President, and not individually
<PAGE>
EXHIBIT 6
DISTRIBUTION AGREEMENT
DISTRIBUTION AGREEMENT, as of this 8th day of December, 1993, by and
between MFS UNION STANDARD TRUST, a Massachusetts business trust (the "Trust"),
on behalf of each series from time to time of the Trust (referred to
individually as a "Fund" and collectively as the "Funds") and MFS INVESTOR
SERVICES, INC., a Delaware corporation (the "Distributor");
NOW, THEREFORE, in consideration of the mutual promises and undertakings
herein contained, the parties hereto agree as follows:
1. The Trust grants to the Distributor the right, as agent of the Trust,
to sell Shares of Beneficial Interest, without par value, of the Funds (the
"Shares") upon the terms herein below set forth during the term of this
Agreement. While this Agreement is in force, the Distributor agrees to use its
best efforts to find purchasers for Shares.
The Distributor shall have the right, as agent of the Trust, to order
from the Trust the Shares needed, but not more than the Shares needed (except
for clerical errors and errors of transmission) to fill unconditional orders for
Shares placed with the Distributor by investors as set forth in the current
prospectus and statement of additional information (collectively, the
"Prospectus") relating to the Shares. The price which shall be paid to the
Trust for the Shares so purchased shall be the net asset value on which such
orders were based. The Distributor shall notify the Custodian of the Trust, at
the end of each business day, or as soon thereafter as the orders placed with it
have been compiled, of the number of Shares and the prices thereof which have
been ordered through the Distributor since the end of the previous day.
The right granted to the Distributor to place orders for Shares with
the Trust shall be exclusive, except that said exclusive right shall not apply
to Shares issued in the event that an investment company (whether a regulated or
private investment company or a personal holding company) is merged or
consolidated with the Trust (or a Fund) or in the event that the Trust (or a
Fund) acquires by purchase or otherwise, all (or substantially all) the assets
or the outstanding shares of any such company; nor shall it apply to Shares
issued by the Trust (or a Fund) as a stock dividend or a stock split. The
exclusive right to place orders for Shares granted to the Distributor may be
waived by the Distributor by notice to the Trust in writing, either
unconditionally or subject to such conditions and limitations as may be set
forth in the notice to the Trust. The Trust hereby acknowledges that the
Distributor may render distribution and other services to other parties,
including other investment companies. In connection with its duties hereunder,
the Distributor shall also arrange for computation of performance statistics
with respect to the Trust and arrange for publication of current price
information in newspapers and other publications.
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2. The Shares may be sold through the Distributor to investors upon the
following terms and conditions:
The Distributor may place orders for Shares at the net asset value for
such Shares (as established pursuant to paragraph l above) on behalf of such
purchasers and under such circumstances as the Prospectus describes, provided
that such sales comply with Rule 22d-1 under the Investment Company Act of 1940
or any exemptive order granted by the Securities and Exchange Commission. The
Distributor may also place orders for Shares at net asset value on behalf of
persons reinvesting the proceeds of the redemption or resale of Shares or shares
of other investment companies for which the Distributor acts as Distributor or
as otherwise provided in the current Prospectus.
The net asset value of Shares shall be determined by the Trust or by
an agent of the Trust, as of the close of regular trading of the New York Stock
Exchange on each business day on which said Exchange is open, in accordance with
the method set forth in the governing instruments (as hereinafter defined) of
the Trust. The Trust may also cause the net asset value to be determined in
substantially the same manner or estimated in such manner and as of such other
hour or hours as may from time to time be agreed upon in writing by the Trust
and Distributor. The Trust shall have the right to suspend the sale of Shares
if, because of some extraordinary condition, the New York Stock Exchange shall
be closed, or if conditions obtaining during the hours when the Exchange is open
render such action advisable, or for any other reasons deemed adequate by the
Trust.
3. The Trust agrees that it will, from time to time, take all necessary
action to register the offering and sale of Shares under the Securities Act of
l933, as amended (the "Act"), and applicable state securities laws.
The Distributor shall be an independent contractor and neither the
Distributor nor any of its directors, officers or employees as such, is or shall
be an employee of the Trust. It is understood that Trustees, officers and
shareholders of the Trust are or may become interested in the Distributor, as
Directors, officers and employees, or otherwise and that Directors, officers and
employees of the Distributor are or may become similarly interested in the Trust
and that the Distributor may be or become interested in the Trust as a
shareholder or otherwise. The Distributor is responsible for its own conduct
and the employment, control and conduct of its agents and employees and for
injury to such agents or employees or to others through its agents or employees.
The Distributor assumes full responsibility for its agents and employees under
applicable statutes and agrees to pay all employer taxes thereunder.
4. The Distributor covenants and agrees that, in selling Shares, it will
use its best efforts in all respects duly to conform with the requirements of
all state and federal laws and the Rules of Fair Practice of the National
Association of Securities Dealers, Inc. (the "NASD") relating to the sale of
Shares, and will indemnify and hold harmless the Trust and each of its Trustees
and officers and each person, if any, who controls the Trust within the meaning
of Section 15 of the Act, against any loss, liability, damages, claim or expense
(including the reasonable cost of investigating or defending any alleged loss,
liability, damages, claim or expense and reasonable counsel fees incurred in
connection therewith), arising by reason of any person's acquiring any Shares,
which may be based upon the Act or any other statute or common law, on account
of any
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wrongful act of the Distributor or any of its employees (including any failure
to conform with any requirement of any state or federal law or the Rules of Fair
Practice of the NASD relating to the sale of Shares) or on the ground that the
registration statement or Prospectus or Statement of Additional Information, as
from time to time amended and supplemented, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading, unless any
such act, statement or omission was made in reliance upon information furnished
to the Distributor by or on behalf of the Trust, provided, however, that in no
case (i) is the indemnity of the Distributor in favor of any person indemnified
to be deemed to protect the Trust or any such person against any liability to
which the Trust or any such person would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of its or
his duties or by reason of its or his reckless disregard of its obligations and
duties under this Agreement, or (ii) is the Distributor to be liable under its
indemnity agreement contained in this paragraph with respect to any claim made
against the Trust or any person indemnified unless the Trust or such person, as
the case may be, shall have notified the Distributor in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the Trust or
upon such person (or after the Trust or such person shall have received notice
of such service on any designated agent), but failure to notify the Distributor
of any such claim shall not relieve it from any liability which it may have to
the Trust or any person against whom such action is brought otherwise than on
account of its indemnity agreement contained in this paragraph. The Distributor
shall be entitled to participate, at its own expense, in the defense, or, if it
so elects, to assume the defense of any suit brought to enforce any such
liability, but, if the Distributor elects to assume the defense, such defense
shall be conducted by counsel chosen by it and satisfactory to the Trust, or to
its officers or Trustees, or to any controlling person or persons, defendant or
defendants in the suit. In the event that the Distributor elects to assume the
defense of any such suit and retain such counsel, the Trust or such officers or
Trustees or controlling person or persons, defendant or defendants in the suit,
shall bear the fees and expenses of any additional counsel retained by them,
but, in case the Distributor does not elect to assume the defense of any such
suit, it shall reimburse the Trust and such officers and Trustees or controlling
person or persons, defendant or defendants in such suit, for the reasonable fees
and expenses of any counsel retained by them. The Distributor agrees promptly
to notify the Trust of the commencement of any litigation or proceedings against
it in connection with the issue and sale of any Shares.
Neither the Distributor nor any other person is authorized to give any
information or to make any representation on behalf of the Trust, other than
those contained in the registration statement or Prospectus filed with the
Securities and Exchange Commission under the Act (as said registration statement
or Prospectus may be amended or supplemented from time to time), covering the
Shares or other than those contained in periodic reports to shareholders of the
Trust.
5. The Trust will pay, or cause to be paid -
(i) all costs and expenses of the Trust, including fees and
disbursements of its counsel, in connection with the preparation and filing of
any required registration statement or Prospectus under the Act covering Shares
and all amendments and supplements thereto and any notices regarding the
registration of shares, and preparing and mailing to shareholders
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Prospectuses, statements and confirmations and periodic reports (including the
expense of setting up in type any such registration statement, Prospectus or
periodic report);
(ii) the expenses (including auditing expenses) of
qualification of the Shares for sale, and, if necessary or advisable in
connection therewith, of qualifying the Trust as a dealer or broker, in such
states as shall be selected by the Distributor and the fees payable to each such
state with respect to shares sold and for continuing the qualification therein
until the Distributor notifies the Trust that it does not wish such
qualification continued;
(iii) the cost of preparing temporary or permanent certificates
for Shares;
(iv) all fees and disbursements of the transfer agent of the
Trust;
(v) the cost and expenses of delivering to the Distributor at
its office in Boston, Massachusetts, all Shares purchased through it as agent
hereunder; and
(vi) all the federal and state issue and/or transfer taxes
payable upon the issue by or (in the case of treasury Shares) transfer from the
Trust of any and all Shares purchased through the Distributor hereunder.
The Distributor agrees that, after the Prospectus and periodic reports
have been set up in type, it will bear the expense (other than the cost of
mailing to shareholders of the Trust) of printing and distributing any copies
thereof which are to be used in connection with the offering of Shares to
investors. The Distributor further agrees that it will bear the expenses of
preparing, printing and distributing any other literature used by the
Distributor for use in connection with the offering of the Shares for sale to
the public and any expenses of advertising in connection with such offering.
Nothing in this paragraph 5 shall be deemed to prohibit or conflict with any
payment by the Trust or any Fund to the Distributor pursuant to any Distribution
Plan adopted and in effect pursuant to Rule 12b-1 under the Investment Company
Act of 1940.
6. The Trust hereby authorizes the Distributor to repurchase, upon the
terms and conditions set forth in written instructions given by the Trust to the
Distributor from time to time, as agent of the Trust and for its account, such
Shares as may be offered for sale to the Trust from time to time.
(a) The Distributor shall notify in writing the Custodian of the
Trust, at the end of each business day, or as soon thereafter as the repurchases
have been compiled, of the number of Shares repurchased for the account of the
Trust since the last previous report, together with the prices at which such
repurchases were made, and upon the request of any Officer or Trustee of the
Trust shall furnish similar information with respect to all repurchases made up
to the time of the request on any day.
(b) The Trust reserves the right to suspend or revoke the
foregoing authorization at any time. Unless otherwise stated, any such
suspension or revocation shall be effective forthwith upon receipt of notice
thereof by an officer of the Distributor, by telegraph or by written notice from
the Trust. In the event that the authorization of the Distributor is, by the
terms of such notice, suspended for more than twenty-four hours or until further
notice, the
4
<PAGE>
authorization given by this paragraph 6 shall not be revived except by action of
a majority of the members of the Board of Trustees of the Trust.
(c) The Distributor shall have the right to terminate the
operation of this paragraph 6 upon giving to the Trust thirty days' written
notice thereof.
(d) The Trust agrees to authorize and direct the Custodian to
pay, for the account of the Trust, the purchase price of any Shares so
repurchased against delivery of the certificates, if any, in proper form for
transfer to the Trust or for cancellation by the Trust.
(e) The Distributor shall receive no commission in respect of
any repurchase of Shares under the foregoing authorization and appointment as
agent.
(f) The Trust agrees to reimburse the Distributor, from time to
time upon demand, for any reasonable expenses incurred in connection with the
repurchase of Shares pursuant to this paragraph 6.
7. If, at any time during the existence of this Agreement, the Trust
shall deem it necessary or advisable in the best interests of the Trust that any
amendment of this Agreement be made in order to comply with the recommendations
or requirements of the Securities and Exchange Commission or other governmental
authority or to obtain any advantage under Massachusetts, any state or federal
tax laws, it shall notify the Distributor of the form of amendment which it
deems necessary or advisable and the reasons therefore. If the Distributor
declines to assent to such amendment, the Trust may terminate this Agreement
forthwith by written notice to the Distributor without payment of any penalty.
If, at any time during the existence of this Agreement, upon request by the
Distributor, the Trust fails (after a reasonable time) to make any changes in
its governing instruments or in its methods of doing business which are
necessary in order to comply with any requirements of federal or state laws or
regulations, laws or regulations of the Securities and Exchange Commission or of
a national securities association of which the Distributor is or may be a
member, relating to the sale of Shares, the Distributor may terminate this
Agreement forthwith by written notice to the Trust without payment of any
penalty.
8. The Distributor agrees that it will not take any long or short
positions in the Shares except as permitted by paragraphs l and 6 hereof.
Whenever used in this Agreement, the term "governing instruments" shall mean the
Declaration of Trust and the By-Laws of the Trust, as from time to time amended.
9. This Agreement shall become effective upon its execution and shall
continue in force until December 8, 1995 on which date it will terminate unless
its continuance after December 8, 1995, is specifically approved at least
annually (i) by the vote of a majority of the Board of Trustees of the Trust who
are not interested persons of the Trust or of the Distributor at a meeting
specifically called for the purpose of voting on such approval, and (ii) by the
Board of Trustees of the Trust or by vote of a majority of the outstanding
voting securities of the Trust. The aforesaid requirement that continuance of
this Agreement be "specifically approved at least annually" shall be construed
in a manner consistent with the Investment Company Act of l940 and the Rules and
Regulations thereunder.
5
<PAGE>
This Agreement may be terminated at any time by either party without
payment of any penalty on not more than sixty days' or less than thirty days'
written notice to the other party.
l0. This Agreement shall automatically terminate in the event of its
assignment.
11. The terms "vote of a majority of the outstanding voting securities",
"interested person" and "assignment" shall have the respective meanings
specified in the Investment Company Act of l940 and the Rules and Regulations
thereunder, subject, however, to such exemptions as may be granted by the
Securities and Exchange Commission under said Act.
12. This Agreement shall be governed by the laws of The Commonwealth of
Massachusetts.
13. The undersigned officer of the Trust has executed the Agreement not
individually, but as an officer under the Trust's Declaration of Trust dated
September 1, 1993, and the obligations of the Agreement are not binding upon any
of the Trustees, officers or shareholders of the Trust individually, but bind
only the Trust estate.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written on December 8, 1993.
MFS UNION STANDARD TRUST
By: A. KEITH BRODKIN
----------------------
A. Keith Brodkin
Chairman and President
MFS INVESTOR SERVICES, INC.
By: WILLIAM W. SCOTT, JR.
----------------------
William W. Scott, Jr.
President
6
<PAGE>
EXHIBIT 8b
AMENDMENT TO CUSTODIAN CONTRACT
Amendment to Custodian Contract between MFS Union Standard Trust, a business
trust organized and existing under the laws of Massachusetts, having a principal
place of business at 500 Boylston 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
December 8, l993 (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;
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
-1-
<PAGE>
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.
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, 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 the Fund's custody account.
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.
-2-
<PAGE>
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 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 the 8th day of
December, 1993.
ATTEST:
By: STEPHEN E. CAVAN By: A. KEITH BRODKIN
------------------ ------------------------
Stephen E. Cavan A. Keith Brodkin
Title:
ATTEST: STATE STREET BANK &
TRUST COMPANY
By: E. SOLOMON By: DONALD LOGUE
------------------ ------------------------
E. Solomon Donald Logue
Title: Executive Vice President
-3-
<PAGE>
EXHIBIT 8c
AMENDMENT TO CUSTODIAN CONTRACT
Amendment to Custodian Contract between MFS Union Standard Trust, a business
trust organized and existing under the laws of Massachusetts, having a principal
place of business at 500 Boylston Street, Boston, Massachusetts 02116
(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").
WHEREAS: The Trust and the Custodian are parties to a Custodian Contract dated
December 8, 1993, as amended (the "Custodian Contract");
WHEREAS: The Trust has established a series of Shares (MFS Union Standard
Research Fund (the "Series")) in addition to the initial series with respect to
which it desires to have the Custodian render services as custodian under the
terms of the Custodian Contract;
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 have the meanings ascribed
to them in the Custodian Contract.
2. Pursuant to Section 12 of the Custodian Contract, the Trust and the
Custodian hereby agree that the Custodian shall render services as custodian
under the terms of the Custodian Contract to the Series and that the Series is
hereby deemed a "Portfolio" as defined in the Custodian Contract.
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 the 15th day of
November, 1995.
ATTEST: MFS UNION STANDARD TRUST
By: By:
-------------------------- -------------------------
Title:
-------------------------
<PAGE>
ATTEST: STATE STREET BANK AND TRUST
COMPANY
By: By:
-------------------------- -------------------------
Title:
-------------------------
<PAGE>
EXHIBIT 9a
MFS UNION STANDARD TRUST
500 Boylston Street
Boston, Massachusetts 02116
[November 15, 1995]
MFS Service Center, Inc.
500 Boylston Street
Boston, Massachusetts 02116
AMENDED AND RESTATED SHAREHOLDER SERVICING AGENT AGREEMENT
Dear Sir:
MFS Union Standard Trust, which is a Massachusetts business trust (referred
to as the "Trust") with two series, MFS Union Standard Equity Fund and MFS Union
Standard Research Fund (each a "Fund"), is an open-end registered investment
company. The Trust has selected you to act as its Shareholder Servicing Agent
and you hereby agree to act as such Agent and to perform the duties and
functions thereof in the manner and on the conditions hereinafter set forth.
Accordingly, the Trust hereby agrees with you as follows:
1. THE FACILITY. You represent that you have the necessary computer
equipment, software and other office equipment ("Facility") adequate to perform
the services contemplated hereby for the Fund as well as for other investment
companies (such investment companies, together with the Fund, are herein
collectively referred to as the "MFS Funds") for which Massachusetts Financial
Services Company ("MFS") acts as investment adviser. The Facility is presently
located at 500 Boylston Street, Boston, Massachusetts, and is to be dedicated
solely to the performance of services for the MFS Funds, provided that the
Facility may be utilized to perform services for others with the permission of
the MFS Funds.
2. NAME. Unless otherwise directed in writing by MFS, you shall perform
the services contemplated hereby under the name "MFS Service Center, Inc.",
which name and any similar names and any logos of which shall remain the
property and under the control of MFS. Upon termination of this Agreement, you
shall cease to use such name or any similar name within a reasonable period of
time.
<PAGE>
3. SERVICES TO BE PERFORMED. As Shareholder Servicing Agent ("Agent"),
you shall be responsible for administering and performing transfer and dividend
and distribution disbursing functions in connection with the issuance, transfer
and redemption of various classes of shares of beneficial interest of the
various series of the Trust existing from time to time ("Shares"). The details
of the operating standards and procedures to be followed by you shall be
determined from time to time by agreement between you and the Fund.
4. STANDARD OF SERVICE. As Agent for the Fund, you agree to provide
service equal to or better than that provided by you or others furnishing
shareholder services to other open-end investment companies ("Standard") at a
fee comparable to the fee paid you for your services hereunder. The Standard
shall include at least the following:
(a) Prompt reconciliation of any differences as to the number of
outstanding shares between various Facility records or between Facility records
and records of the Fund's custodian;
(b) Prompt processing of shareholder correspondence and of other
matters requiring action by you;
(c) Prompt clearance of any daily volume backlog;
(d) Providing innovative services and technological improvements;
(e) Meeting the requirements of any governmental authority having
jurisdiction over you or the Fund; and
(f) Prompt reconciliation of all bank accounts under your control
belonging to the Fund or MFS.
If any MFS Fund serviced by you is reasonably of the view that the service
provided by you does not meet the Standard, it shall give you written notice
specifying the particulars, and you then shall have 120 days in which to restore
the service so that it meets the Standard, except that such period shall be 180
days with respect to meeting that portion of the Standard described above in
item (d) of this paragraph 4. If at the end of such period the Fund remains
reasonably of the view that the service provided by you, in the particulars
specified, does not meet the Standard, then the MFS Fund or Funds having a
majority of the accounts for which you are then Agent may, by appropriate action
(including the concurrence of a majority of the Trustees of such MFS Fund or
Funds, who are not interested persons of MFS), elect to terminate this Agreement
for cause as to all such Funds upon 90 days notice to you. Upon termination
hereof, the Fund shall pay you such compensation as may be due to you as of the
date of such termination, and shall likewise reimburse you for any costs,
expenses, and disbursements reasonably incurred by you to such date in the
performance of your duties hereunder.
2
<PAGE>
5. PURCHASE OF FACILITY. In the event that you have given notice of
termination of this Agreement pursuant to the provisions of paragraph 14 hereof,
or for cause as provided in paragraph 4 hereof, the MFS Funds shall have the
right, but shall not be required (a) to purchase the Facility and assume the
unexpired portion of any leases of equipment or real estate relating to the
Facility from you at a price equal to your estimated unrecovered acquisition
value (as supported by the schedules and records used in determining monthly
billings) of the machinery, equipment, software, furniture, fixtures and
leasehold improvements included in the Facility, and (b) to negotiate with
persons then employed by you in the operation of the Facility and to hire all of
them in connection with the purchase of the Facility from you by the MFS Funds.
You agree to release each such employee from any contractual obligations such
persons may have to you that may interfere with such person's being hired at
such time by the MFS Funds and agree not to interfere with the negotiation and
hiring of any such persons at any such time. In the event that the MFS Funds
have given notice of termination of this Agreement pursuant to the provisions of
paragraph 14 hereof, for reasons other than cause as defined in paragraph 4
hereof, the MFS Funds shall purchase the Facility under the terms and conditions
set forth in subsections (a) and (b) of this paragraph 5.
You shall effect the transfer of the Facility pursuant to this paragraph 5
upon the termination date specified in the notice, or at such other time as
shall be agreed upon by the parties hereto.
6. RIGHTS IN DATA AND CONFIDENTIALITY. You agree that all records, data,
files, input materials, reports, forms and other data received, computed or
stored in the performance of this Agreement are the exclusive property of the
Fund and that all such records and other data shall be furnished without
additional charge, except for actual processing costs, to the Fund in machine
readable as well as printed form immediately upon termination of this Agreement
or at the Fund's request. You shall safeguard and maintain the confidentiality
of the Fund's data and information supplied to you by the Fund and you shall not
transfer or disclose the Fund's data to any third party without the Fund's prior
written consent unless compelled to do so by order of a court or regulatory
authority.
7. FEES. The fee for your services hereunder shall not be in excess of
such amount as shall be agreed in writing between us (see Exhibit A attached
hereto). Such fee shall be payable in monthly installments of one-twelfth of
the annual fee. Such fee shall be subject to review at least annually and fixed
by the parties in good faith negotiation on the basis of a statement of the
expenses of the Facility prepared by you, which either you or the Fund may
require to be certified by a major accounting firm acceptable to the parties.
The party or parties requesting such certification shall bear all expenses
thereof. In addition to the foregoing fee, you will be reimbursed by the Fund
for out-of-pocket expenses reasonably incurred by you on behalf of the Fund,
including but not limited to expenses for stationery (including business forms
and checks), postage, telephone and telegraph line and toll charges, and
premiums for negotiable instrument insurance and similar items.
3
<PAGE>
8. RECORD KEEPING. You will maintain records in a form acceptable to the
Fund and in compliance with the rules and regulations of the Securities and
Exchange Commission, including but not limited to records required to be
maintained by Section 31(a) of the Investment Company Act of 1940 and the rules
thereunder, which at all times will be the property of the Fund and will be
available for inspection and use by the Fund.
9. DUTY OF CARE AND INDEMNIFICATION. You will at all times act in good
faith in performing your duties hereunder. You will not be liable or
responsible for delays or errors by reason of circumstances beyond your control,
including acts of civil or military authority, national emergencies, labor
difficulties, fire, mechanical breakdown beyond your control, flood or
catastrophe, acts of God, insurrection, war, riots or failure beyond your
control of transportation, communication or power supply. The Fund will
indemnify you against and hold you harmless from any and all losses, claims,
damages, liabilities or expenses (including reasonable counsel fees and
expenses) resulting from any claim, demand, action or suit not resulting from
your bad faith or negligence, and arising out of, or in connection with, your
duties on behalf of the Fund hereunder. In addition, the Fund will indemnify
you against and hold you harmless from any and all losses, claims, damages,
liabilities or expenses (including reasonable counsel fees and expenses)
resulting from any claim, demand, action or suit as a result of your acting in
accordance with any instructions reasonably believed by you to have been
executed or orally communicated by any person duly authorized by the Fund or its
Principal Underwriter, or as a result of acting in accordance with written or
oral advice reasonably believed by you to have been given by counsel for the
Fund, or as a result of acting in accordance with any instrument or share
certificate reasonably believed by you to have been genuine and signed,
countersigned or executed by any person or persons authorized to sign,
countersign or execute the same (unless contributed to by your gross negligence
or bad faith). In any case in which the Fund may be asked to indemnify you or
hold you harmless, the Fund shall be advised of all pertinent facts concerning
the situation in question and you will use reasonable care to identify and
notify the Fund promptly concerning any situation which presents or appears
likely to present a claim for indemnification against the Fund. The Fund shall
have the option to defend you against any claim which may be the subject of this
indemnification, and in the event that the Fund so elects such defense shall be
conducted by counsel chosen by the Fund and satisfactory to you and it will so
notify you, and thereupon the Fund shall take over complete defense of the claim
and you shall sustain no further legal or other expenses in such situation for
which you seek indemnification under this paragraph, except the expense of any
additional counsel retained by you. You will in no case confess any claim or
make any compromise in any case in which the Fund will be asked to indemnify you
except with the Fund's prior written consent. The obligations of the parties
hereto under this paragraph shall survive the termination of this Agreement.
If any officer of the Fund shall no longer be vested with authority to sign
for the Fund, written notice thereof shall forthwith be given to you by the Fund
and until receipt of such notice by it, you shall be fully indemnified and held
harmless by the Fund in recognizing and acting upon certificates or other
instruments bearing the signatures or facsimile signatures of such officer.
4
<PAGE>
10. INSURANCE. You will notify the Fund should any of your insurance
coverage, as set forth on Exhibit A hereto, be changed for any reason, such
notification to include the date of change and reason or reasons therefor.
11. NOTICES. All notices or other communications hereunder shall be in
writing and shall be deemed sufficient if mailed to either party at the
addresses set forth in this Agreement, or at such other addresses as the parties
hereto may designate by notice to each other.
12. FURTHER ASSURANCES. Each party agrees to perform such further acts
and execute such further documents as are necessary to effectuate the purposes
hereof.
13. USE OF A SUB- OR CO-TRANSFER AGENT. Notwithstanding any other
provision of this Agreement, it is expressly understood and agreed that you are
authorized in the performance of your duties hereunder to employ, from time to
time, one or more Sub-Transfer Agents and/or Co-Transfer Agents.
14. AMENDMENT AND TERMINATION. Neither this Agreement nor any provision
hereof may be changed, waived, discharged or terminated orally, but only by an
instrument in writing, which, except in the case of termination, shall be signed
by the party against which enforcement of such change, waiver or discharge is
sought. Except as otherwise provided in paragraph 4 hereof, this Agreement
shall continue indefinitely until terminated by 90 days' written notice given by
the Fund to you or by you to the Fund. Upon termination hereof, the Fund shall
pay you such compensation as may be due to you as of the date of such
termination, and shall likewise reimburse you for any costs, expenses, and
disbursements reasonably incurred by you to such date in the performance of your
duties hereunder. You agree to cooperate with the Fund and provide all
necessary assistance in effectuating an orderly transition upon termination of
this Agreement.
15. SUCCESSOR. In the event that in connection with termination a
successor to any of your duties or responsibilities hereunder is designated by
the Fund by written notice to you, you will, promptly upon such termination and
at the expense of the Fund, transfer to such successor a certified list of the
shareholders of the Fund (with name, address and tax identification or Social
Security number), an historical record of the account of each shareholder and
the status thereof, and all other relevant books, records, correspondence, and
other data established or maintained by you under this Agreement in form
reasonably acceptable to the Fund (if such form differs from the form in which
you have maintained the same, the Fund shall pay any expenses associated with
transferring the same to such form), and will cooperate in the transfer of such
duties and responsibilities, including provision for assistance from your
cognizant personnel in the establishment of books, records and other data by
such successor.
16. MISCELLANEOUS. This Agreement shall be construed and enforced in
accordance with and governed by the laws of the Commonwealth of Massachusetts.
The captions in this Agreement are included for convenience of reference only
and in no way define or delimit any of
5
<PAGE>
the provisions hereof or otherwise affect their construction or effect. This
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which taken together shall
constitute one and the same instrument.
17. TRUST ONLY. A copy of the Declaration of Trust of the Trust is
on file with the Secretary of State of The Commonwealth of Massachusetts. You
acknowledge that the obligations of or arising out of this instrument are not
binding upon any of the 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 hereunder. If this
instrument is executed by the Trust on behalf of one or more series of the
Trust, you further acknowledge 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 instrument are binding solely upon the assets or property of the series
on whose behalf the Trust has executed this instrument on behalf of more than
one series of the Trust, you also agree that the obligations of each series
hereunder shall be several and not joint, in accordance with its proportionate
interest hereunder, and you agree not to proceed against any series for the
obligations of another series.
Very truly yours,
MFS UNION STANDARD TRUST
on behalf of its various series
-------------------------------
Chairman
The foregoing is hereby accepted as of the date thereof.
MFS SERVICE CENTER, INC.
------------------------
President
6
<PAGE>
EXHIBIT 9c
MFS UNION STANDARD TRUST
500 Boylston Street
Boston, MA 02116
December 8, 1993
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
DIVIDEND DISBURSING AGENCY AGREEMENT
Dear Sirs:
The above-referenced trust (the "Trust") is an open-end registered
investment company organized as a Massachusetts business trust. The Trust has
selected you to act as its Dividend Disbursing Agent and you hereby agree to act
as such Agent and perform the duties and functions thereof in the manner and on
the conditions hereinafter set forth. Accordingly, the Trust hereby agrees with
you as follows:
1. SERVICES TO BE PERFORMED. As Dividend Disbursing Agent ("Agent"), you
shall be responsible for performing dividend and distribution disbursing agent
functions with regard to the Trust's shares of beneficial interest ("Shares").
The details of the operating standards and procedures to be followed by you
shall be determined from time to time by agreement between you and the Trust.
2. STANDARD OF SERVICE. As Agent for the Trust, you agree to provide
service equal to at least that provided by you or others furnishing dividend and
distribution disbursing services to other open-end investment companies
("Standard") at a fee, as may be agreed to from time to time, comparable to the
fee paid you for your services hereunder. The Standard shall include at least
the following:
(a) Prompt processing of all matters requiring action by you;
(b) Prompt clearance of any daily volume backlog;
(c) Providing innovative services and technological improvements;
(d) Meeting the requirements of any governmental authority having
jurisdiction over you or the Trust; and
(e) Prompt reconciliation of all bank accounts under your control
belonging to the Trust.
If the Trust is reasonably of the view that the service provided by you
does not meet
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the Standard, it shall give you written notice specifying the particulars, and
you shall then have 120 days in which to restore the service so that it meets
the Standard, except that such period shall be 180 days with respect to meeting
that portion of the Standard described above in item (c) of this paragraph 2.
If at the end of such period the Trust remains reasonably of the view that the
service provided by you in the particulars specified, does not meet the
Standard, then the Trust may, by appropriate action, elect to terminate this
Agreement for cause upon 90 days notice to you. Upon termination hereof, the
Trust shall pay you such compensation as may be due to you as of the date of
such termination, and shall likewise reimburse you for any costs, expenses, and
disbursements reasonably incurred by you to such date in the performance of your
duties hereunder.
3. RIGHTS IN DATA AND CONFIDENTIALITY. You agree that all records, data,
files, input materials, reports, forms and other data received, computed or
stored in the performance of this Agreement are the exclusive property of the
Trust and that all such records and other data shall be furnished without
additional charge, except for actual processing costs, to the Trust in machine
readable as well as printed form immediately upon termination of this Agreement
or at the Trust's request. You shall safeguard and maintain the confidentiality
of the Trust's data and information supplied to you by the Trust and you shall
not transfer or disclose the Trust's data to any third party without the Trust's
prior written consent unless compelled to do so by order of a court or a
regulatory authority.
4. FEES. The fee, based upon check clearance and reconciliation work
performed hereunder, shall not be in excess of such amount as shall be agreed in
writing between us. Such fee shall be payable in monthly installments. Such
fee shall be subject to review at least annually and fixed by the parties in
good faith negotiation on the basis of a statement of your expenses, which
either you or the Trust may require to be certified by a major accounting firm
acceptable to the parties. The party requesting such certification shall bear
all expenses thereof. In addition to the foregoing fee, you will be reimbursed
by the Trust for out-of-pocket expenses reasonably incurred by you on behalf of
the Trust, including but not limited to expenses for stationery, postage,
telephone and telegraph line and toll charges and similar items.
5. RECORD KEEPING. You will maintain records in a form acceptable to the
Trust and in compliance with the rules and regulations of the Securities and
Exchange Commission, including, but not limited to, records required to be
maintained by Section 31(a) of the Investment Company Act of 1940 and the rules
thereunder, which at all times will be the property of the Trust and will be
available for inspection and use by the Trust or the Trust's transfer agent.
6. DUTY OF CARE AND INDEMNIFICATION. You will at all times act in good
faith in performing your duties hereunder. You will not be liable or
responsible for delays or errors by reason of circumstances beyond your control,
including acts of civil or military authority, national emergencies, labor
difficulties, fire, mechanical breakdown beyond your control, flood or
catastrophe, acts of God, insurrection, war, riots or failure beyond your
control of transportation, communication or power supply. The Trust will
indemnify you against and hold you harmless from any and all losses, claims,
damages, liabilities or expenses (including reasonable counsel fees and
expenses) resulting from any claim, demand, action or suit not resulting from
your bad faith or negligence, and arising out of, or in connection with, your
2
<PAGE>
duties on behalf of the Trust hereunder. In addition, the Trust will indemnify
you against and hold you harmless from any and all losses, claims, damages,
liabilities or expenses (including reasonable counsel fees and expenses)
resulting from any claim, demand, action or suit as a result of your acting in
accordance with any instructions reasonably believed by you to have been given,
executed or orally communicated by any person duly authorized by the Trust or as
a result of acting in accordance with written or oral advice reasonably believed
by you to have been given by counsel for the Trust, or as a result of acting in
accordance with any instrument or share certificate reasonably believed by you
to have been genuine and signed, countersigned or executed by any person or
persons authorized to sign, countersign or execute the same (unless contributed
to by your gross negligence or bad faith). In any case in which the Trust may
be asked to indemnify you or hold you harmless, the Trust shall be advised of
all pertinent facts concerning the situation in question and you will use
reasonable care to identify and notify the Trust promptly concerning any
situation which presents or appears likely to present a claim for
indemnification against the Trust. The Trust shall have the option to defend
you against any claim which may be the subject of this indemnification, and in
the event that the Trust so elects such defense shall be conducted by counsel
chosen by the Trust and satisfactory to you and it will so notify you, and
thereupon the Trust shall take over complete defense of the claim and you shall
sustain no further legal or other expenses in such situation for which you seek
indemnification under this paragraph, except the expense of any additional
counsel retained by you. You will in no case confess any claim or make any
compromise in any case in which the Trust will be asked to indemnify you except
with the Trust's prior written consent. The obligations of the parties hereto
under this paragraph shall survive the termination of this Agreement.
7. INSURANCE. You will notify the Trust should any of your insurance
coverage, as set forth on Exhibit A hereto, be changed for any reason, such
notification to include the date of change and reason or reasons therefor.
8. NOTICES. All notices or other communications hereunder shall be in
writing and shall be deemed sufficient if mailed to either party at the
addresses set forth in this Agreement, or at such other addresses as the parties
hereto may designate by notice to each other.
9. FURTHER ASSURANCES. Each party agrees to perform such further acts
and execute such further documents as are necessary to effectuate the purposes
hereof.
10. USE OF A SUB-DIVIDEND DISBURSING AGENT. Notwithstanding any other
provision of this Agreement, it is expressly understood and agreed that you are
authorized in the performance of your duties hereunder to employ one or more
Sub-Dividend Disbursing Agents.
11. TERMINATION. Neither this Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing, which, except in the case of termination, shall be signed by the party
against which enforcement of such change, waiver or discharge is sought. Except
as otherwise provided in paragraph 2 hereof, this Agreement shall continue
indefinitely until terminated by 90 days' written notice given by the Trust to
you or by you to the Trust. Upon termination hereof, the Trust shall pay you
such compensation as may be due to you as of the date of such termination, and
shall likewise
3
<PAGE>
reimburse you for any costs, expenses, and disbursements reasonably incurred by
you to such date in the performance of your duties hereunder. You agree to
cooperate with the Trust and provide all necessary assistance in effectuating an
orderly transition upon termination of the Agreement.
12. SUCCESSOR. In the event that in connection with termination a
successor to any of your duties or responsibilities hereunder is designated by
the Trust by written notice to you, you will, promptly upon such termination and
at the expense of the Trust, transfer to such successor an historical record of
dividends and disbursements and all other relevant books, records,
correspondence, and other data established or maintained by you under this
Agreement in form reasonably acceptable to the Trust (if such form differs from
the form in which you have maintained the same, the Trust shall pay any expenses
associated with transferring the same to such form), and will cooperate in the
transfer of such duties and responsibilities, including provision for assistance
from your cognizant personnel in the establishment of books, records and other
such data by such successor.
13. MISCELLANEOUS. This Agreement shall be construed and enforced in
accordance with and governed by the laws of the Commonwealth of Massachusetts.
The captions in this Agreement are included for convenience of reference only
and in no way define or delimit any of the provisions hereof or otherwise affect
their construction or effect. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all of
which taken together shall constitute one and the same instrument. This
Agreement has been executed on behalf of the Trust by the undersigned not
individually, but in the capacity indicated, and the obligations of this
Agreement are not binding upon any of the Trustees, officers or shareholders of
the Trust individually, but bind only the trust estate.
If you are in agreement with the foregoing, please sign the form of
acceptance on this letter and the accompanying counterpart of this letter and
return such counterpart to the Trust whereupon this letter shall become a
binding contract between the Trust and you, the Trust having already executed
this letter and its counterpart.
Very truly yours,
MFS UNION STANDARD TRUST
By: A. KEITH BRODKIN
------------------------
A. Keith Brodkin
Chairman
Attest: STEPHEN E. CAVAN
----------------------
The foregoing is hereby accepted as of the date thereof
STATE STREET BANK AND TRUST COMPANY
By: DONALD LOGUE
----------------------
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EXHIBIT 13
MFS
MASSACHUSETTS FINANCIAL SERVICES COMPANY
500 BOYLSTON STREET - BOSTON - MASSACHUSETTS 02116-3741
617-954-5000
November 19, 1993
MFS Union Standard Equity Fund
MFS Union Standard Fixed Income Fund
500 Boylston Street
Boston, MA 02116
Gentlemen:
In connection with the purchase by the undersigned of 5,000 Shares of
Beneficial Interest (without par value) of MFS Union Standard Equity Fund and
5,000 Shares of Beneficial Interest (without par value) of MFS Union Standard
Fixed Income Fund, each a portfolio of MFS Union Standard Trust, the undersigned
hereby represents and warrants to you that it is purchasing said shares as an
investment with no intention of reselling said shares until a date at least two
years hereafter.
Very truly yours,
MASSACHUSETTS FINANCIAL
SERVICES COMPANY
By: A KEITH BRODKIN
-------------------------
Chairman
<PAGE>
EXHIBIT 15a
MFS UNION STANDARD TRUST
MFS UNION STANDARD EQUITY FUND
DISTRIBUTION PLAN
DISTRIBUTION PLAN with respect to the shares of beneficial interest of the MFS
UNION STANDARD EQUITY FUND (the "Fund), a series of MFS UNION STANDARD TRUST
(the "Trust"), a business trust organized and existing under the laws of The
Commonwealth of Massachusetts, dated December 8, 1993.
WITNESSETH:
WHEREAS, the Trust is engaged in business as an open-end management investment
company and is registered under the Investment Company Act of 1940 (the "Act");
and
WHEREAS, a plan of distribution pursuant to Rule 12b-1 of the Act has been
adopted and approved by the Trustees of the Trust, including the Qualifying
Trustees (as defined below), and by the shareholders of the Fund; and
WHEREAS, the Trust intends to distribute the Shares of Beneficial Interest
(without par value) of the Fund (the "Shares") in part in accordance with Rule
12b-1 under the Act ("Rule 12b-1"), and desires to adopt this Distribution Plan
(the "Plan") as a plan of distribution pursuant to such Rule; and
WHEREAS, the Trust on behalf of the Fund and the other series, from time to
time, of the Trust has entered into a distribution agreement (the "Distribution
Agreement") in a form approved by the Board of Trustees of the Trust (the "Board
of Trustees") in the manner specified in Rule 12b-1, with MFS Investor Services,
Inc., a Delaware corporation, as distributor (the "Distributor"), whereby the
Distributor provides facilities and personnel and renders services to the Fund
in connection with the offering and distribution of the Shares; and
WHEREAS, the Board of Trustees, in considering whether the Fund should adopt and
implement this Plan, has evaluated such information as it deemed necessary to an
informed determination as to whether this Plan should be adopted and implemented
and has considered such pertinent factors as it deemed necessary to form the
basis for a decision to use assets of the Fund for such purposes, and has
determined that there is a reasonable likelihood that the adoption and
implementation of this Plan will benefit the Fund and its shareholders;
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NOW, THEREFORE, the Board of Trustees hereby adopts this Plan for the Fund as a
plan of distribution in accordance with Rule 12b-1 under the Act, on the
following terms and conditions:
1. As specified in the Distribution Agreement, the Distributor shall
provide facilities, personnel and a program with respect to the offering and
sale of Shares. Among other things, the Distributor shall be responsible for
all expenses of printing (excluding typesetting) and distributing prospectuses
to prospective shareholders and providing such other related services as are
reasonably necessary in connection therewith.
2. The Distribution Fee (as defined below) may be applied by the
Distributor to any activities or expenses primarily intended to result in the
sale of the Fund's shares, including, but not limited to, compensation to and
expenses of employees of the Distributor who engage in or support the
distribution of shares or who service shareholder accounts, preparation,
printing and mailing of prospectuses and statements of additional information to
other than existing shareholders, reports to shareholders such as semiannual and
annual reports, performance reports and newsletters, sales literature and other
promotional material to prospective investors, direct mail solicitation,
advertising and public relations, compensation of sales personnel, office
expenses (including rent and overhead), equipment, travel and telephone expenses
and such other expenses as may be approved from time to time by the Trustees and
as may be permitted by applicable statute, rule or regulation.
3. As partial consideration for the services performed and expenses
incurred in the performance of its obligations under the Distribution Agreement
and as specified in Section 2 hereof, the Trust on behalf of the Fund shall pay
the Distributor a distribution fee periodically at a rate up to 0.25% per annum
of the average daily net assets of the Fund (the "Distribution Fee"). Such
payments shall commence following the effectiveness of the Distribution
Agreement and shareholder approval of the Plan but only upon notification by the
Distributor to the Fund of the commencement of the Plan (the "Commencement
Date").
4. In addition to fees payable pursuant to Section 3 hereof, the expenses
permitted to be paid by the Fund pursuant to this Plan on or after the
Commencement Date shall include other distribution related expenses. These
other distribution related expenses may include, but are not limited to, a
commission and a payment to wholesalers and others employed by the Distributor.
5. Nothing herein contained shall be deemed to require the Trust to take
any action contrary to its Declaration of Trust or By-Laws or any applicable
statutory or regulatory requirement to which it is subject or by which it is
bound, or to relieve or deprive the Board of Trustees of the responsibility for
and control of the conduct of the affairs of the Fund.
6. This Plan shall become effective upon (a) approval by a vote of at
least a "majority of the outstanding voting securities" of the Shares, and (b)
approval by a vote of the Board of Trustees and vote of a majority of the
Trustees who are not "interested persons" of the Trust and who have no direct or
indirect financial interest in the operation of the Plan or in any of the
agreements related to the Plan (the "Qualified Trustees"), such votes to be cast
in person at a meeting called for the purpose of voting on this Plan.
2
<PAGE>
7. This Plan shall continue in effect indefinitely; PROVIDED, HOWEVER,
that such continuance is subject to annual approval by a vote of the Board of
Trustees and a majority of the Qualified Trustees, such votes to be cast in
person at a meeting called for the purpose of voting on continuance of this
Plan. If such annual approval is not obtained, this Plan shall expire 12 months
after the effective date of the last approval.
8. This Plan may be amended at any time by the Board of Trustees;
provided that (a) any amendment to increase materially the amount to be spent
for the services described herein shall be effective only upon approval by a
vote of a "majority of the outstanding voting securities" of the Shares and (b)
any material amendment of this Plan shall be effective only upon approval by a
vote of the Board of Trustees and a majority of the Qualified Trustees, such
votes to be cast in person at a meeting called for the purpose of voting on such
amendment. This Plan may be terminated at any time by vote of a majority of the
Qualified Trustees or by a vote of a "majority of the outstanding voting
securities" of the Shares.
9. The Distributor shall provide the Board of Trustees, and the Board of
Trustees shall review, at least quarterly, a written report of the amounts
expended under the Plan and the purposes for which such expenditures were made.
10. While this Plan is in effect, the selection and nomination of
Qualified Trustees shall be committed to the discretion of the Trustees who are
not "interested persons" of the Trust.
11. For the purposes of this Plan, the terms "interested person" and
"majority of the outstanding voting securities" are used as defined in the Act.
In addition, for purposes of determining the fees payable to the Distributor,
the value of the Share's net assets shall be computed in the manner specified in
the Fund's then current prospectus for computation of the net asset value of the
Shares.
12. The Trust shall preserve copies of this Plan, and each agreement
related hereto and each report referred to in Section 9 hereof (collectively the
"Records") for a period of six years from the end of the fiscal year in which
such Record was made and each such Record shall be kept in an easily accessible
place for the first two years of said record keeping.
13. This Plan shall be construed in accordance with the laws of The
Commonwealth of Massachusetts and the applicable provisions of the Act.
14. If any provision of this Plan shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of the Plan shall not be
affected thereby.
3
<PAGE>
EXHIBIT 15b
MFS UNION STANDARD TRUST
MFS UNION STANDARD RESEARCH FUND
DISTRIBUTION PLAN
DISTRIBUTION PLAN with respect to the shares of beneficial interest of the MFS
UNION STANDARD RESEARCH FUND (the "Fund), a series of MFS UNION STANDARD TRUST
(the "Trust"), a business trust organized and existing under the laws of The
Commonwealth of Massachusetts, dated [November 15, 1995].
WITNESSETH:
WHEREAS, the Trust is engaged in business as an open-end management investment
company and is registered under the Investment Company Act of 1940 (the "Act");
and
WHEREAS, a plan of distribution pursuant to Rule 12b-1 of the Act has been
adopted and approved by the Trustees of the Trust, including the Qualifying
Trustees (as defined below), and by the shareholders of the Fund; and
WHEREAS, the Trust intends to distribute the Shares of Beneficial Interest
(without par value) of the Fund (the "Shares") in part in accordance with Rule
12b-1 under the Act ("Rule 12b-1"), and desires to adopt this Distribution Plan
(the "Plan") as a plan of distribution pursuant to such Rule; and
WHEREAS, the Trust on behalf of the Fund and the other series, from time to
time, of the Trust has entered into a distribution agreement (the "Distribution
Agreement") in a form approved by the Board of Trustees of the Trust (the "Board
of Trustees") in the manner specified in Rule 12b-1, with MFS Investor Services,
Inc., a Delaware corporation, as distributor (the "Distributor"), whereby the
Distributor provides facilities and personnel and renders services to the Fund
in connection with the offering and distribution of the Shares; and
WHEREAS, the Board of Trustees, in considering whether the Fund should adopt and
implement this Plan, has evaluated such information as it deemed necessary to an
informed determination as to whether this Plan should be adopted and implemented
and has considered such pertinent factors as it deemed necessary to form the
basis for a decision to use assets of the Fund for such purposes, and has
determined that there is a reasonable likelihood that the adoption and
implementation of this Plan will benefit the Fund and its shareholders;
<PAGE>
NOW, THEREFORE, the Board of Trustees hereby adopts this Plan for the Fund as a
plan of distribution in accordance with Rule 12b-1 under the Act, on the
following terms and conditions:
1. As specified in the Distribution Agreement, the Distributor shall
provide facilities, personnel and a program with respect to the offering and
sale of Shares. Among other things, the Distributor shall be responsible for
all expenses of printing (excluding typesetting) and distributing prospectuses
to prospective shareholders and providing such other related services as are
reasonably necessary in connection therewith.
2. The Distribution Fee (as defined below) may be applied by the
Distributor to any activities or expenses primarily intended to result in the
sale of the Fund's shares, including, but not limited to, compensation to and
expenses of employees of the Distributor who engage in or support the
distribution of shares or who service shareholder accounts, preparation,
printing and mailing of prospectuses and statements of additional information to
other than existing shareholders, reports to shareholders such as semiannual and
annual reports, performance reports and newsletters, sales literature and other
promotional material to prospective investors, direct mail solicitation,
advertising and public relations, compensation of sales personnel, office
expenses (including rent and overhead), equipment, travel and telephone expenses
and such other expenses as may be approved from time to time by the Trustees and
as may be permitted by applicable statute, rule or regulation.
3. As partial consideration for the services performed and expenses
incurred in the performance of its obligations under the Distribution Agreement
and as specified in Section 2 hereof, the Trust on behalf of the Fund shall pay
the Distributor a distribution fee periodically at a rate up to 0.25% per annum
of the average daily net assets of the Fund (the "Distribution Fee"). Such
payments shall commence following the effectiveness of the Distribution
Agreement and shareholder approval of the Plan but only upon notification by the
Distributor to the Fund of the commencement of the Plan (the "Commencement
Date").
4. In addition to fees payable pursuant to Section 3 hereof, the expenses
permitted to be paid by the Fund pursuant to this Plan on or after the
Commencement Date shall include other distribution related expenses. These
other distribution related expenses may include, but are not limited to, a
commission and a payment to wholesalers and others employed by the Distributor.
5. Nothing herein contained shall be deemed to require the Trust to take
any action contrary to its Declaration of Trust or By-Laws or any applicable
statutory or regulatory requirement to which it is subject or by which it is
bound, or to relieve or deprive the Board of Trustees of the responsibility for
and control of the conduct of the affairs of the Fund.
6. This Plan shall become effective upon (a) approval by a vote of at
least a "majority of the outstanding voting securities" of the Shares, and (b)
approval by a vote of the Board of Trustees and vote of a majority of the
Trustees who are not "interested persons" of the Trust and who have no direct or
indirect financial interest in the operation of the Plan or in any of the
agreements related to the Plan (the "Qualified Trustees"), such votes to be cast
in person at a meeting called for the purpose of voting on this Plan.
<PAGE>
7. This Plan shall continue in effect indefinitely; PROVIDED, HOWEVER,
that such continuance is subject to annual approval by a vote of the Board of
Trustees and a majority of the Qualified Trustees, such votes to be cast in
person at a meeting called for the purpose of voting on continuance of this
Plan. If such annual approval is not obtained, this Plan shall expire 12 months
after the effective date of the last approval.
8. This Plan may be amended at any time by the Board of Trustees;
provided that (a) any amendment to increase materially the amount to be spent
for the services described herein shall be effective only upon approval by a
vote of a "majority of the outstanding voting securities" of the Shares and (b)
any material amendment of this Plan shall be effective only upon approval by a
vote of the Board of Trustees and a majority of the Qualified Trustees, such
votes to be cast in person at a meeting called for the purpose of voting on such
amendment. This Plan may be terminated at any time by vote of a majority of the
Qualified Trustees or by a vote of a "majority of the outstanding voting
securities" of the Shares.
9. The Distributor shall provide the Board of Trustees, and the Board of
Trustees shall review, at least quarterly, a written report of the amounts
expended under the Plan and the purposes for which such expenditures were made.
10. While this Plan is in effect, the selection and nomination of
Qualified Trustees shall be committed to the discretion of the Trustees who are
not "interested persons" of the Trust.
11. For the purposes of this Plan, the terms "interested person" and
"majority of the outstanding voting securities" are used as defined in the Act.
In addition, for purposes of determining the fees payable to the Distributor,
the value of the Share's net assets shall be computed in the manner specified in
the Fund's then current prospectus for computation of the net asset value of the
Shares.
12. The Trust shall preserve copies of this Plan, and each agreement
related hereto and each report referred to in Section 9 hereof (collectively the
"Records") for a period of six years from the end of the fiscal year in which
such Record was made and each such Record shall be kept in an easily accessible
place for the first two years of said record keeping.
13. This Plan shall be construed in accordance with the laws of The
Commonwealth of Massachusetts and the applicable provisions of the Act.
14. If any provision of this Plan shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of the Plan shall not be
affected thereby.