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As filed with the Securities and Exchange Commission on October 26, 1995
1933 Act File No. 33-74668
1940 Act File No. 811-8326
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM N-1A
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 4
AND
REGISTRATION STATEMENT
UNDER
THE INVESTMENT COMPANY ACT OF 1940
AMENDMENT NO. 5
MFS VARIABLE INSURANCE TRUST
(Exact name of registrant as specified in its 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)
|X| immediately upon filing pursuant to paragraph (b)
|_| on [DATE] pursuant to paragraph (b)
|_| 60 days after filing pursuant to paragraph (a)(i)
|_| on March 1, 1995 pursuant to paragraph (a)(i)
|_| 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
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. The Registrant filed a Rule 24f-2 Notice for its first fiscal year
ended December 31, 1994 on February 28, 1995.
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PART C
Item 24. Financial Statements and Exhibits
MFS World Governments Series
(a) Financial Statements Included in Part A
For the period from commencement of investment operations on
June 10, 1994 to December 31, 1994:
Financial Highlights*
Included in Part B of this Registration Statement:
At December 31, 1994:
Portfolio of Investments*
Statement of Assets and Liabilities*
For the period from commencement of investment operations on
June 10, 1994 to December 31, 1994:
Statement of Operations*
Statement of Changes in Net Assets*
All Series Except World Government Series
(b) Financial Statements Included in Part A
None
Included in Part B of this Registration Statement:
At December 31, 1994:
Statement of Assets and Liabilities**
Opinion of Independent Auditors**
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* Incorporated by reference to the MFS World Governments Series Annual Report to
Shareholders dated December 31, 1994 filed with the SEC via EDGAR on February
20, 1995.
**Incorporated by reference to Part B of the Registrant's Post-Effective
Amendment No. 3 filed with the SEC via EDGAR on April 23, 1995.
(b) Exhibits
1 (a) Declaration of Trust, dated January 28, 1994; filed herewith.
(b) Amendment to Declaration of Trust - Designation of Series of
Shares dated January 31, 1994; filed herewith.
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(c) Amendment to Declaration of Trust - Redesignation of Series,
dated June 1, 1995; filed herewith.
2 By-Laws, dated January 28, 1994; filed herewith.
3 Not Applicable.
4 Not Applicable.
5 Investment Advisory Agreement by and between Registrant and
Massachusetts Financial Services Company, dated April 14,
1994; filed herewith.
6 Distribution Agreement between Registrant and Massachusetts
Investors Services, Inc., dated April 14, 1994; filed
herewith.
7 Not Applicable.
8 Custodian Agreement between Registrant and Investors Bank &
Trust Company, dated April 14, 1994; filed herewith.
9 (a) Shareholder Servicing Agent Agreement between Registrant and
MFS Service Center, dated April 14, 1994; filed herewith.
(b) Dividend Disbursing Agency Agreement between Registrant and
State Street Bank and Trust, dated April 14, 1994; filed
herewith.
10 Opinion and Consent of Counsel filed with Registrant's Rule
24f-2 Notice for fiscal year ended December 31, 1994 on
February 28, 1995. (2)
11 Consent of Deloitte & Touche. (2)
12 Not Applicable.
13 Investment Representation Letter; filed herewith.
14 Not Applicable.
15 Not Applicable.
16 Schedule of Computation for Performance Quotations - Average
Annual Total Rate of Return, Aggregate Total Rate of Return
and Standardized Yield. (1)
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17 Financial Data Schedule. (2)
18 Not Applicable.
Power of Attorney dated August 12, 1994; filed herewith.
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(1) Incorporated by reference to MFS Municipal Series Trust (File Nos.
2-92915 and 811-4096) Post-Effective Amendment No. 26 filed with the SEC
via EDGAR on February 22, 1995.
(2) Incorporated by reference to Registrant's Post-Effective Amendment No. 3
filed with the SEC via EDGAR on April 23, 1995.
Item 25. Persons Controlled by or under Common Control with Registrant
Not applicable.
Item 26. Number of Holders of Securities
MFS Emerging Growth Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 10
(without par value) (as of August 31, 1995)
MFS Growth Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 3
(without par value) (as of August 31, 1995)
MFS Research Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 6
(without par value) (as of August 31, 1995)
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MFS Growth With Income Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 3
(without par value) (as of August 31, 1995)
MFS Total Return Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 10
(without par value) (as of August 31, 1995)
MFS Utilities Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 10
(without par value) (as of August 31, 1995)
MFS High Income Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 5
(without par value) (as of August 31, 1995)
MFS World Governments Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 15
(without par value) (as of August 31, 1995)
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MFS Strategic Fixed Income Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 3
(without par value) (as of August 31, 1995)
MFS Bond Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 4
(without par value) (as of August 31, 1995)
MFS Limited Maturity Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 3
(without par value) (as of August 31, 1995)
MFS Money Market Series
(1) (2)
Title of Class Number of Record Holders
Shares of Beneficial Interest 6
(without par value) (as of August 31, 1995)
Item 27. Indemnification
Reference is hereby made to (a) Section 5.3 of the Registrant's
Declaration of Trust, filed herewith; and (b) Section 9 of the Shareholder
Servicing Agent Agreement between the Registrant and MFS Service Center, Inc.,
filed herewith.
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.
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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 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.
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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. 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.
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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.
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
<PAGE>
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 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.
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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.
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.
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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.
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.
<PAGE>
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, George F. Bennett, Carol A. Corley, John A. Gee,
Brianne Grady and Kevin R. Parke 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.
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)
<PAGE>
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 office of the Registrant and the following locations:
NAME ADDRESS
Massachusetts Financial Services 500 Boylston Street
Company (investment adviser) Boston, MA 02116
MFS Fund Distributors, Inc. 500 Boylston Street
(distributor) Boston, MA 02116
Investors Bank & Trust 89 South Street
Company (custodian) Boston, MA 02111
MFS Service Center, Inc. 500 Boylston Street
(transfer agent) 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 Investors Bank &
Trust Company, 89 South Street, Boston, MA 02111.
Item 31. Management Services
Not applicable.
<PAGE>
Item 32. Undertakings
(a) Not applicable.
(b) Not applicable.
(c) Registrant undertakes to furnish each person to whom a prospectus
is delivered with a copy of its 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 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 certifies that it meets all of
the requirements for effectiveness of this Registration Statement pursuant to
Rule 485(b) under the Securities Act of 1933 and 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 20th day of October, 1995.
MFS VARIABLE INSURANCE 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 October 20, 1995.
SIGNATURE TITLE
A. KEITH BRODKIN* Chairman, President (Principal
A. Keith Brodkin Executive Officer) and Trustee
W. THOMAS LONDON* Treasurer (Principal Financial Officer
W. Thomas London and Principal Accounting Officer)
WILLIAM R. GUTOW* Trustee
William R. Gutow
<PAGE>
NELSON J. DARLING, JR.* Trustee
Nelson J. Darling, Jr.
*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; filed herewith.
<PAGE>
POWER OF ATTORNEY
MFS Variable Insurance Trust
The undersigned, Trustees and officers of MFS Variable Insurance 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;
A. Keith Brodkin and Principal Executive Officer
NELSON J. DARLING, JR. Trustee
Nelson J. Darling, Jr.
WILLIAM R. GUTOW Trustee
William R. Gutow
W. THOMAS LONDON Principal Financial and
W. Thomas London Accounting Officer
<PAGE>
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION OF EXHIBIT
1 (a) Declaration of Trust, dated January 28, 1994.
(b) Amendment to Declaration of Trust - Designation of Series
of Shares dated January 31, 1994.
(c) Amendment to Declaration of Trust - Redesignation of Series,
dated June 1, 1995.
2 By-Laws, dated January 28, 1994.
5 Investment Advisory Agreement by and between Registrant and
Massachusetts Financial Services Company, dated April 14,
1994.
6 Distribution Agreement between Registrant and Massachusetts
Investors Services, Inc., dated April 14, 1994.
8 Custodian Agreement between Registrant and Investors Bank &
Trust Company, dated April 14, 1994.
9 (a) Shareholder Servicing Agent Agreement between Registrant and
MFS Service Center, dated April 14, 1994.
(b) Dividend Disbursing Agency Agreement between Registrant and
State Street Bank and Trust, dated April 14, 1994.
13 Investment Representation Letter.
<PAGE>
EXHIBIT NO. 99.1(a)
MFS VARIABLE INSURANCE TRUST
--------------------------
DECLARATION OF TRUST
DATED JANUARY 28, 1994
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I -- NAME AND DEFINITIONS: 1
Section 1.1. Name
Section 1.2. Definitions
ARTICLE II -- TRUSTEES: 3
Section 2.1. Number of Trustees
Section 2.2. Term of Office of Trustees
Section 2.3. Resignation and Appointment of Trustees
Section 2.4. Vacancies
Section 2.5. Delegation of Power to Other Trustees
ARTICLE III -- POWERS OF TRUSTEES: 4
Section 3.1 General
Section 3.2. Investments
Section 3.3. Legal Title
Section 3.4. Issuance and Repurchase of Securities
Section 3.5. Borrowing Money; Lending Trust Property
Section 3.6. Delegation; Committees
Section 3.7. Collection and Payment
Section 3.8. Expenses
Section 3.9. Manner of Acting; By-Laws
Section 3.10 Miscellaneous Powers
Section 3.11. Principal Transactions
Section 3.12. Trustees and Officers as Shareholders
ARTICLE IV -- INVESTMENT ADVISER, DISTRIBUTOR AND TRANSFER AGENT: 8
Section 4.1. Investment Adviser
Section 4.2. Distributor
Section 4.3. Transfer Agent
Section 4.4. Parties to Contract
ARTICLE V -- LIMITATIONS OF LIABILITY OF SHAREHOLDERS, TRUSTEES AND OTHERS: 9
Section 5.1. No Personal Liability of Shareholders, Trustees, etc.
Section 5.2. Non-Liability of Trustees, etc.
Section 5.3. Mandatory Indemnification
Section 5.4. No Bond Required of Trustees
<PAGE>
TABLE OF CONTENTS (CONTINUED)
PAGE
Section 5.5. No Duty of Investigation; Notice in Trust
Instruments, etc.
Section 5.6. Reliance on Experts, etc.
ARTICLE VI -- SHARES OF BENEFICIAL INTEREST: 12
Section 6.1. Beneficial Interest
Section 6.2. Rights of Shareholders
Section 6.3. Trust Only
Section 6.4. Issuance of Shares
Section 6.5. Register of Shares
Section 6.6. Transfer of Shares
Section 6.7. Notices
Section 6.8. Voting Powers
Section 6.9. Series Designation
Section 6.10. Class Designation
ARTICLE VII -- REDEMPTIONS: 16
Section 7.1. Redemption of Shares
Section 7.2. Price
Section 7.3. Payment
Section 7.4. Effect of Suspension of Determination of Net Asset
Value
Section 7.5. Redemption of Shares in Order to Qualify as Regulated
Investment
Company; Disclosure of Holding
Section 7.6. Suspension of Right to Redemption
ARTICLE VIII -- DETERMINATION OF NET ASSET VALUE, NET INCOME AND
DISTRIBUTIONS: 18
ARTICLE IX -- DURATION; TERMINATION OF TRUST; AMENDMENT; MERGERS, ETC.: 18
Section 9.1. Duration
Section 9.2. Termination of Trust
Section 9.3. Amendment Procedure
Section 9.4. Merger, Consolidation and Sale of Assets
Section 9.5. Incorporation and Reorganization
Section 9.6. Incorporation or Reorganization of Series
ARTICLE X -- REPORTS TO SHAREHOLDERS AND SHAREHOLDER COMMUNICATIONS: 21
<PAGE>
TABLE OF CONTENTS (CONTINUED)
PAGE
ARTICLE XI -- MISCELLANEOUS: 22
Section 11.1. Filing
Section 11.2. Governing Law
Section 11.3. Counterparts
Section 11.4. Reliance By Third Parties
Section 11.5. Provisions in Conflict with Law or Regulations
SIGNATURE PAGE AND ADDRESSES: 23
NOTARY: 24
<PAGE>
DECLARATION OF TRUST
OF
MFS VARIABLE INSURANCE TRUST
Dated January 28, 1994
DECLARATION OF TRUST, made January 28, 1994, 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
Variable Insurance 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.
<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.
<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
<PAGE>
Trustees in office, regardless of their number, shall have all the powers
granted to the Trustees and shall discharge all the duties imposed upon the
Trustees by the Declaration. A written instrument certifying the existence of
such vacancy signed by a majority of the Trustees shall be conclusive evidence
of the existence of such vacancy.
Section 2.5. Delegation of Power to Other Trustees. Any Trustee may,
by power of attorney, delegate his power for a period not exceeding six 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,
<PAGE>
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 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 Sections
6.9 and 6.10 hereof, to apply to any such repurchase, redemption, retirement,
cancellation or acquisition of Shares any funds of the Trust or other Trust
Property whether
<PAGE>
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.
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 Sections 6.9 and 6.10
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 Sections 6.9 and 6.10 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
<PAGE>
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.
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
<PAGE>
(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 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
<PAGE>
the existence of any such relationship; nor shall any Person holding such
relationship be liable merely by reason of such relationship for any loss or
expense to the Trust under or by reason of said contract or accountable for any
profit realized directly or indirectly therefrom, provided that the contract
when entered into was not inconsistent with the provisions of this Article IV or
the By-Laws. The same Person may be the other party to contracts entered into
pursuant to Sections 4.1, 4.2 and 4.3 above or custodian contracts, and any
individual may be financially interested or otherwise affiliated with Persons
who are parties to any or all of the contracts mentioned in this Section 4.4.
ARTICLE V
LIMITATIONS OF LIABILITY OF SHAREHOLDERS, TRUSTEES AND OTHERS
Section 5.1. No Personal Liability of Shareholders, Trustees, etc. 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:
<PAGE>
(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:
(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
<PAGE>
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.
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
<PAGE>
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 or classes as
provided in Sections 6.9 and 6.10 hereof. The number of Shares authorized
hereunder is unlimited. All Shares issued hereunder including, without
limitation, Shares issued in connection with a dividend in Shares or a split of
Shares, shall be fully paid and non-assessable.
Section 6.2. Rights of Shareholders. The ownership of the Trust
Property of every description and the right to conduct any business hereinbefore
described are vested exclusively in the Trustees, and the Shareholders shall
have no interest therein other than the beneficial interest conferred by their
Shares, and they shall have no right to call for any partition or division of
any property, profits, rights or interests of the Trust nor can they be called
upon to assume any losses of the Trust or suffer an assessment of any kind by
virtue of their ownership of Shares. The Shares shall be personal property
giving only the rights 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
<PAGE>
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 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
<PAGE>
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 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
<PAGE>
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.
(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
<PAGE>
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.
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
<PAGE>
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
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
<PAGE>
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 Sections 6.9 and 6.10 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 class or net income
attributable to the Shares of any series or class, or the declaration and
payment of dividends and distributions on the Shares of any series or class, as
they may deem necessary or desirable.
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;
<PAGE>
(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
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
or class in accordance with Sections 6.9 and 6.10 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 or class
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 or class.
<PAGE>
(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 or class 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
or class 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 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
<PAGE>
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
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
<PAGE>
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.
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
<PAGE>
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.
IN WITNESS WHEREOF, the undersigned have executed this instrument this
28th day of January, 1994.
JAMES R. BORDEWICK, JR.
James R. Bordewick, Jr.
as Trustee and not individually
500 Boylston Street
Boston, Massachusetts
A. KEITH BRODKIN
A. Keith Brodkin
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
<PAGE>
COMMONWEALTH OF MASSACHUSETTS
SUFFOLK, SS. BOSTON, MASSACHUSETTS
January 28, 1994
Then personally appeared the above-named James R. Bordewick, Jr., A.
Keith Brodkin and Arnold D. Scott, and who severally acknowledged the
foregoing instrument to be their free act and deed.
Before me,
LISA J. SANBORN
Lisa J. Sanborn, Notary Public
My commission expires:
<PAGE>
EXHIBIT NO. 99.1(b)
MFS VARIABLE INSURANCE 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 January 28,
1994, as amended (the "Declaration of Trust"), of MFS Variable Insurance Trust
(the "Trust"), the Trustees of the Trust hereby divide the Shares (as defined in
the Declaration of Trust) into twelve separate series, each series to have the
following special and relative rights:
1. The series shall be designated:
(i) MFS OTC Series
(ii) MFS Growth Series
(iii) MFS Research Series
(iv) MFS Growth With Income Series
(v) MFS Total Return Series
(vi) MFS Utilities Series
(vii) MFS High Income Series
(viii) MFS World Governments Series
(ix) MFS Strategic Fixed Income Series
(x) MFS Bond Series
(xi) MFS Limited Maturity Series
(xii) MFS Money Market Series
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
<PAGE>
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.
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 31st day of January, 1994.
A. KEITH BRODKIN
A. Keith Brodkin
ARNOLD D. SCOTT
Arnold D. Scott
JAMES R. BORDEWICK, JR.
James R. Bordewick, Jr.
<PAGE>
EXHIBIT NO. 99.1(c)
MFS VARIABLE INSURANCE TRUST
CERTIFICATION OF AMENDMENT
TO DECLARATION OF TRUST
REDESIGNATION
OF SERIES
Pursuant to Section 6.9 of the Declaration of Trust dated Feburary 1,
1994 (the "Declaration"), of MFS Variable Insurance Trust (the "Trust"), the
Trustees of the Trust hereby redesignate an existing series of Shares (as
defined in the Declaration):
1. The series designated as MFS OTC Series shall be redesignated as
MFS Emerging Growth Series.
Pursuant to Section 6.9(i) of the Declaration, this redesignation 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 redesignation of series this 30th day of May, 1995.
A. KEITH BRODKIN NELSON J. DARLING, JR.
A. Keith Brodkin Nelson J. Darling, Jr.
William R. Gutow
<PAGE>
EXHIBIT NO. 99.2
BY-LAWS
OF
MFS VARIABLE INSURANCE TRUST
January 28, 1994
<PAGE>
BY-LAWS
OF
MFS VARIABLE INSURANCE 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 Variable Insurance Trust,
dated January 28, 1994, as amended from time to time.
ARTICLE II
OFFICES
Section l. 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 l. 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
<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 or
class shall vote as a series or class, then a majority of the aggregate number
of Shares of that series or class entitled to vote shall be necessary to
constitute a quorum for the transaction of business by that series or class. 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
<PAGE>
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.
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
<PAGE>
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 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
<PAGE>
advisory capacity. Such Advisory Board shall meet at such times and upon such
notice as the Trustees may by resolution provide.
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 resignation has been
accepted by the Trustees or 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
<PAGE>
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 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.
<PAGE>
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.
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 January in
each year and shall end on the last day of December in that 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.
<PAGE>
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 its 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
<PAGE>
such securities, provided that all such deposits shall be subject to withdrawal
only upon the order of the Trust or its custodian.
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 substance of 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.
1
<PAGE>
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
The term "net asset value" shall mean that amount by which the assets
of that series or class thereof exceed its liabilities, all as determine by or
under the direction of the Trustees. Such value shall be determined on such days
and at such time as the Trustees may determine. Such determination shall be made
with respect to securities for which market quotations are readily available, at
the market value of such securities; and with respect to other securities and
assets, at the fair value as determined in good faith by the Trustees, provided,
however, that the Trustees, without shareholder approval, may alter the method
of appraising portfolio securities insofar as permitted under the Investment
Company Act of 1940, as amended and the rules, regulations and interpretations
thereof promulgated or issued by the Securities and Exchange Commission or
insofar as permitted by any order of the Securities and Exchange commission. The
Trustees may delegate any powers and duties under this Article XII with respect
to appraisal of assets and liabilities. At any time the Trustees may cause the
value per share last determined
<PAGE>
to be determined again in a similar manner and may fix the time when such
redetermined value shall become effective.
ARTICLE XIII
DIVIDENDS AND DISTRIBUTIONS
Section 1. Limitations on Distributions. The total of distributions to
Shareholders of a particular series or class 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 or class 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 or class issued or repurchased), but if the net income
of such series or class 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 or class 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 or class 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.
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 or class (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
<PAGE>
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 or class a "stock dividend" out of either
authorized but unissued Shares of such series or treasury Shares of such series
or class 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.
<PAGE>
EXHIBIT NO. 99.5
INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT, dated as of this 14th day of April,
1994 by and between MFS VARIABLE INSURANCE TRUST, a Massachusetts business trust
(the "Trust") on behalf of the series of the Trust listed on Exhibit A attached
hereto (referred to individually as a "Fund" and collectively as the "Funds"),
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 each 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 each 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 each 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 each Fund shall
be held uninvested, subject always to the restrictions of the Trust's
Declaration of Trust, dated January 28, 1994 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 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 each
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 each Fund's account with brokers or
dealers selected by it, and to that end the Adviser is authorized as the agent
of each Fund to give instructions to the Custodian of each Fund as to deliveries
of securities and payments of cash for the account of each Fund. In connection
with the selection of such brokers or dealers and the placing of such orders,
the Adviser is directed to seek for each 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 each Fund to pay a broker or dealer an
amount of commission for effecting a securities
<PAGE>
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 each 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 each 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 each 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 each 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, each Fund shall pay to the Adviser an investment advisory fee computed
and paid monthly at the annual rate as listed on Exhibit B, attached hereto, of
each Fund's average daily net assets.
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 Trust's
distributor as principals in making purchases
<PAGE>
or sales of securities or other property for the account of any Fund, will not
take a long or short position in the shares of any 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 any 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 each 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 Trust and
that the Adviser may be or become interested in the Trust as a shareholder or
otherwise.
ARTICLE 8: Duration, Termination and Amendments of this Agreement.
This Agreement shall become effective with respect to each Fund on the date of
its execution and shall govern the relations between the parties hereto
thereafter, and shall remain in force with respect to a Fund until August 1,
1995, on which date it will terminate with respect to that Fund unless its
continuance after August 1, 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 that 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.
This Agreement may be terminated as to any Fund at any time without the
payment of any penalty by the Trustees or by vote of a majority of the
outstanding voting securities of that 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 with respect to any Fund only if such
amendment is approved by vote of a majority of the outstanding voting securities
of that Fund.
<PAGE>
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 may 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 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.
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, officers or shareholders of the Trust, individually, but bind only
the Trust estate.
MFS VARIABLE INSURANCE TRUST
By: A. KEITH BRODKIN
A. Keith Brodkin
Chairman and Trustee
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By: JEFFREY L. SHAMES
Jeffrey L. Shames
President
<PAGE>
EXHIBIT A
MFS VARIABLE INSURANCE TRUST
MFS OTC Series
MFS Growth Series
MFS Research Series
MFS Growth With Income Series
MFS Total Return Series
MFS Utilities Series
MFS High Income Series
MFS World Governments Series
MFS Strategic Fixed Income Series
MFS Bond Series
MFS Limited Maturity Series
MFS Money Market Series
<PAGE>
EXHIBIT B
MANAGEMENT FEES
SERIES % OF AVERAGE DAILY NET ASSETS
MFS OTC Series 0.75
MFS Growth Series 0.75
MFS Research Series 0.75
MFS Growth With Income Series 0.75
MFS Total Return Series 0.75
MFS Utilities Series 0.75
MFS High Income Series 0.75
MFS World Government Series 0.75
MFS Strategic Fixed Income Series 0.75
MFS Bond Series 0.60
MFS Limited Maturity Series 0.55
MFS Money Market Series 0.50
<PAGE>
EXHIBIT NO. 99.6
DISTRIBUTION AGREEMENT
DISTRIBUTION AGREEMENT, as of this 14th day of April, 1994, by and
between MFS VARIABLE INSURANCE 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.
<PAGE>
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
<PAGE>
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 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 -
<PAGE>
(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 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
investors 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.
<PAGE>
(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
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.
<PAGE>
9. This Agreement shall become effective with respect to each Fund
upon its execution and shall continue in force with respect to a Fund until
August 1, 1995 on which date it will terminate with respect to that Fund unless
its continuance after August 1, 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 that 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 l940 and the Rules and
Regulations thereunder.
This Agreement may be terminated as to any Fund 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
January 28, 1994, 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.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above.
MFS VARIABLE INSURANCE 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
<PAGE>
EXHIBIT NO. 99.8
CUSTODIAN AGREEMENT
Between
MFS VARIABLE INSURANCE TRUST
and
INVESTORS BANK & TRUST COMPANY
<PAGE>
TABLE OF CONTENTS
Page
1. Bank Appointed Custodian...................................... 1
2. Definitions................................................... 2
2.1 Authorized Person...................................... 2
2.2 Security............................................... 2
2.3 Portfolio Security..................................... 2
2.4 Officers' Certificate.................................. 2
2.5 Book-Entry System...................................... 2
2.6 Depository............................................. 3
3. Proper Instructions........................................... 3
4. Separate Accounts............................................. 3
5. Certification as to Authorized Persons........................ 3
6. Custody of Cash and Securities................................ 4
6.1 Cash................................................... 4
(a) Purchase of Securities........................... 4
(b) Redemptions...................................... 5
(c) Distributions and Expenses of Fund............... 5
(d) Payment in Respect of Securities................. 5
(e) Repayment of Loans............................... 5
(f) Repayment of Cash................................ 5
(g) Foreign Exchange Transactions.................... 5
(h) Commodities...................................... 5
(i) Other Authorized Payments........................ 6
(j) Termination...................................... 6
6.2 Securities ............................................ 6
(a) Book-Entry System................................ 7
(b) Use of a Depository ............................. 9
(c) Use of Book-Entry System for
Commercial Paper............................. 11
(d) Use of Bond Immobilization Programs.............. 13
(e) Eurodollar CDs................................... 13
6.3 Options and Futures Transactions....................... 13
(a) Puts and Calls Traded on Securities
Exchanges, NASDAQ or Over-the-
Counter...................................... 13
(b) Puts, Calls and Futures Traded
on Commodities Exchanges..................... 14
(c) Segregated Account In Connection with
Options and Futures Transactions............. 15
<PAGE>
Page
6.4 Segregated Account for "When-Issued,"
"Forward Commitment," Reverse Repurchase
Agreement Transactions and Other Purposes........ 15
6.5 Interest Bearing Call or Time Deposits................. 16
7. Transfer of Securities........................................ 17
8. Redemptions................................................... 18
9. Merger, Dissolution, etc. of Fund............................. 19
10. Actions of Bank Without Prior Authorization................... 19
11. Maintenance of Records; Fund Evaluation,
Accounting Services........................................ 20
12. Concerning the Bank .......................................... 22
12.1 Performance of Duties.................................... 22
12.2 Fees and Expenses of Bank................................ 24
12.3 Advances by Bank 24
13. Termination................................................... 25
14. Notices....................................................... 26
15. Amendments.................................................... 27
16. Parties....................................................... 27
17. Governing Law................................................. 27
18. Interpretive and Additional Provisions........................ 27
19. Delegation of Certain Duties to Massachusetts
Financial Services Company ("MFS")......................... 28
<PAGE>
CUSTODIAN AGREEMENT
AGREEMENT made as of this 14th day of April, 1994 between MFS VARIABLE
INSURANCE TRUST, established as a Massachusetts Business Trust under the laws of
the Commonwealth of Massachusetts (the "Fund") on behalf of each of its series,
whether now existing or created during the term of this Agreement, and INVESTORS
BANK & TRUST COMPANY ("Bank").
The Fund, an open end management investment company, desires to place
and maintain all of the securities and cash of each Series in the custody of the
Bank. The Bank has at least the minimum qualifications required by Section 17
(f) (1) of the Investment Company Act of 1940 to act as custodian of the
securities and cash of each Series, and has indicated its willingness to so act,
subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements contained herein, the parties hereto agree as follows:
1. Bank Appointed Custodian. The Fund hereby appoints the Bank as
custodian of the securities and cash of the applicable Series delivered to the
Bank as hereinafter described, and the Bank agrees to act as such upon the terms
and conditions hereinafter set forth. Any reference in this Agreement to any
actions to be taken by the Fund shall be deemed to refer to the Fund acting on
behalf of the applicable Series, any reference in this Agreement to any assets
of the Fund, including, without limitation, any portfolio securities and cash
and earnings thereon, shall be deemed to refer only to assets of the applicable
Series, any duty or obligation of the Bank hereunder to the Fund shall be deemed
to refer to duties and obligations with respect to each Series unless the
context otherwise requires and any obligation or liability of the Fund hereunder
shall be binding only with respect to the applicable Series, and shall be
discharged only out of the assets of such Series.
<PAGE>
2. Definitions. Whenever used herein, the terms listed below will
have the following meaning:
2.1 Authorized Person. Authorized Person will mean any of the
persons duly authorized to give Proper Instructions or otherwise act on behalf
of the Fund by appropriate resolution of the Board of Trustees of the Fund (the
"Board") or with respect to actions regarding transfers of securities and other
investment activities, those persons duly authorized by the investment adviser
of the Fund.
2.2 Security. The term security as used herein will have the same
meaning as when such term is used in the Securities Act of 1933 as amended,
including, without limitation, any note, stock, treasury stock, bond, debenture,
evidence of indebtedness, certificate of interest or participation in any profit
sharing agreement, collateral-trust certificate, preorganization certificate or
subscription, transferable share, investment contract, voting-trust certificate,
certificate of deposit for a security, fractional undivided interest in oil,
gas, or other mineral rights, any put, call, straddle, option, or privilege on
any security, certificate of deposit, or group or index of securities (including
any interest therein or based on the value thereof), or any put, call, straddle,
option, or privilege entered into on a national securities exchange relating to
a foreign currency, or, in general, any interest or instrument commonly known as
a "security", or any certificate of interest or participation in, temporary or
interim certificate for, receipt for, guarantee of, or warrant or right to
subscribe to, or option contract to purchase or sell any of the foregoing and
futures, forward contracts and options thereon.
2.3 Portfolio security. Portfolio security will mean any security
owned by the Fund.
2.4 Officers' Certificate. Officers' Certificate will mean unless
otherwise indicated, any request, direction, instruction, or certification in
writing signed by any Authorized Person or Persons of the Fund as the Fund shall
designate to the Bank in writing from time to time.
2.5 Book-Entry System. Book-Entry System shall mean the Federal
Reserve-Treasury Department Book Entry System for United States government,
instrumentality and agency securities operated by the Federal Reserve Banks, its
successor or successors and its nominee or nominees.
<PAGE>
2.6 Depository. Depository shall mean The Depository Trust
Company ("DTC"), or Participants Trust Company (""PTC"), both of which are
clearing agencies registered with the Securities and Exchange Commission under
Section 17A of the Securities Exchange Act of 1934, and their respective
successor or successors and nominee or nominees. The term "Depository" shall
further mean and include any other person authorized to act as a depository
under the Investment Company Act of 1940, its successor or successors and its
nominee or nominees, specifically identified in a certified copy of a resolution
of the Fund's Board.
3. Proper Instructions. Proper Instructions shall mean (i)
instructions regarding the purchase or sale of securities for the portfolio of
the Fund, and payments and deliveries in connection therewith, given by an
Authorized Person or Persons as designated by the Fund in writing from time to
time with respect to the Series identified therein, such instructions to be
given in such form and manner as the Bank and the Fund shall agree upon from
time to time, and (ii) instructions (which may be continuing instructions)
regarding other matters signed or initialed by such one or more Authorized
Persons. Oral instructions will be considered Proper Instructions if the Bank
reasonably believes them to have been given by an Authorized Person. The Fund
shall cause all oral instructions to be promptly confirmed in writing. The Bank
shall act upon and comply with any subsequent Proper Instruction which modifies
a prior instruction and the Bank shall make reasonable efforts to detect any
discrepancy between the original instruction and such confirmation and to report
such discrepancy to the Fund. Proper Instructions may include communication
effected directly between electromechanical or electronic devices provided that
the Fund and the Bank are satisfied that such procedures afford adequate
safeguards for the Fund's assets.
4. Separate Accounts. The Bank will segregate the assets of each
Series into a separate account containing the assets of such Series (and all
investment earnings thereon), all as directed from time to time by Proper
Instructions.
5. Certification as to Authorized Persons. The Secretary or Assistant
Secretary of the Fund will at all times maintain on file with the Bank his
certification to the Bank, in such form as may be acceptable to the Bank, of (i)
the names and signatures of the Authorized Persons and (ii) the names of the
members of the Board, it being understood that upon the occurrence of any change
in the information set forth in the most recent certification on
<PAGE>
file (including without limitation any person named in the most recent
certification who is no longer an Authorized Person as designated therein), the
Secretary or Assistant Secretary of the Fund will sign a new or amended
certification setting forth the change and the new, additional or omitted names
or signatures. The Bank will be entitled to rely and act upon any Officers,
Certificate given to it by the Fund.
6. Custody of Cash and Securities. As custodian for the Fund, the Bank
will keep safely all of the portfolio securities delivered to the Bank, and will
deposit to the account of the Fund all of the cash of the Fund delivered to the
Bank, as set forth below.
6.1 Cash. The Bank will open and maintain a separate account or
accounts in the name of the Fund or, if directed by the Fund, in the name of the
Bank, as custodian of the Fund, subject only to draft or order by the Bank
acting pursuant to the terms of this Agreement. The Bank will hold in such
account or accounts as custodian, subject to the provisions hereof, all cash
received by it, including borrowed funds, for the account of the Fund. Upon
receipt by the Bank of Proper Instructions (which may be continuing
instructions) or in the case of payments for redemptions and repurchases of
outstanding shares of beneficial interest of the Fund, notification from the
Fund's transfer agent as provided in Section 8, requesting such payment,
designating the payee or the account or accounts to which the Bank will release
funds for deposit, and stating that it is for a purpose permitted under the
terms of this Section 6.1, specifying the applicable subsection, or describing
such purpose with sufficient particularity to permit the Bank to ascertain the
applicable subsection, the Bank will make payments of cash held for the accounts
of the Fund, insofar as funds are available for that purpose, only as permitted
in (a)-(j) below.
(a) Purchase of Securities: upon the purchase of securities
for the Fund, against contemporaneous receipt of such securities by the Bank
registered in the name of the Fund or in the name of, or properly endorsed and
in form for transfer to, the Bank, or a nominee of the Bank, or receipt for the
account of the Bank through use of (1) the Book-Entry System pursuant to Section
6.2 (a) (3) below, (2) Depository pursuant to 6.2(b) below, or (3) Book Entry
Paper pursuant to Section 6.2 (c) below, each such payment to be made at the
purchase price shown in the Proper Instructions received by the Bank before such
payment is made;
<PAGE>
(b) Redemptions: in such amount as may be necessary for the
repurchase or redemption of shares of beneficial interest of the Fund offered
for repurchase or redemption in accordance with Section 8 of this Agreement;
(c) Distributions and Expenses of Fund: for the payment on
the account of the Fund of dividends or other distributions to shareholders as
may from time to time be declared by the Board, interest, taxes, management or
supervisory fees, distribution fees, fees of the Bank for its services hereunder
and reimbursement of the expenses and liabilities of the Bank as provided
hereunder, fees of any transfer agent, fees for legal, accounting, and auditing
services, or other operating expenses of the Fund;
(d) Payment in Respect of Securities: for payments in
connection with the conversion, exchange or surrender of Portfolio securities or
securities subscribed to by the Fund held by or to be delivered to the Bank;
(e) Repayment of Loans: to repay loans of money made to the
Fund, but, in the case of final payment, only upon redelivery to the Bank of
any Portfolio securities pledged or hypothecated therefor and upon surrender
of documents evidencing the loan;
(f) Repayment of Cash: to repay the cash delivered to the
Fund for the purpose of collateralizing the obligation to return to the Fund
Portfolio securities borrowed from the Fund but only upon redelivery to the Bank
of such borrowed Portfolio securities;
(g) Foreign Exchange Transactions: for payments in connection
with foreign exchange contracts or options to purchase and sell foreign
currencies for spot and future delivery which may be entered into by the Bank on
behalf of the Fund upon the receipt of Proper Instructions, such Proper
Instructions to specify the currency broker or banking institution (which may be
the Bank, or any other subcustodian or agent hereunder, acting as principal)
with which the contract or option is made, and the Bank shall have no duty with
respect to the selection of such currency brokers or banking institutions with
which the Fund deals or for their failure to comply with the terms of any
contract or option;
<PAGE>
(h) Commodities: upon the purchase of commodities for the
Fund, against contemporaneous receipt of such commodities by the Bank registered
in the name of the Fund or in the name of, or properly endorsed and in form for
transfer to, the Bank, or a nominee of the Bank;
(i) Other Authorized Payments: for other authorized
transactions of the Fund, or other obligations of the Fund incurred for proper
Fund purposes including, without limitation, payments in connection with any
tender offer by the Fund; provided that before making any such payment the Bank
will also receive an Officer's Certificate naming the person or persons to whom
such payment is to be made, and either describing the transaction for which
payment is to be made and declaring it to be an authorized transaction of the
Fund, or specifying the amount of the obligation for which payment is to be
made, setting forth the purpose for which such obligation was incurred and
declaring such purpose to be a proper corporate purpose; and
(j) Termination: upon the termination of this Agreement as
hereinafter set forth pursuant to Section 9 and Section 13 of this Agreement.
The Bank is hereby authorized to endorse for collection and collect
on behalf of and in the name of the Fund all checks, drafts, or other negotiable
or transferable instruments or other orders for the payment of money received by
it for the account of the Fund.
6.2 Securities. Except as otherwise provided herein, the Bank as
custodian, will receive and hold pursuant to the provisions hereof, in a
separate account or accounts and physically segregated at all times from those
of other persons, any and all Portfolio securities which may now or hereafter be
delivered to it by or for the account of the Fund. All such Portfolio securities
will be held or disposed of by the Bank for, and subject at all times to, the
instructions of the Fund pursuant to the terms of this Agreement. Subject to the
specific provisions herein relating to Portfolio securities that are not
physically held by the Bank, the Bank will register all Portfolio securities
(unless otherwise directed by Proper Instructions or an Officers' Certificate),
in the name of a registered nominee of the Bank as defined in the Internal
Revenue Code and any Regulations of the Treasury Department issued
<PAGE>
thereunder, and will execute and deliver all such certificates in connection
therewith as may be required by such laws or Regulations or under the laws of
any State. The Bank will ensure that the specific securities physically held by
it hereunder will be at all times identifiable and will exercise prudent care
and use its best efforts to the end that the other securities held by it
hereunder will be at all times identifiable.
The Bank will use the same care with respect to the
safekeeping of portfolio securities and cash of the Fund held by it as it uses
in respect of its own similar property (which will at minimum be reasonable
care) but it need not maintain any special insurance for the benefit of the
Fund. The Bank shall provide to the Fund, at least annually and upon request,
information relating to its insurance coverage. The Bank will also immediately
notify the Fund in the event any of its insurance coverage is materially
changed, cancelled or not renewed.
The Fund will from time to time furnish to the Bank
appropriate instruments to enable it to hold or deliver in proper form for
transfer, or to register in the name of its registered nominee, any securities
which it may hold for the account of the Fund and which may from time to time be
registered in the name of the Fund.
Neither the Bank nor any nominee of the Bank will vote any of
the portfolio securities held hereunder by or for the account of the Fund,
except in accordance with Proper Instructions or an Officers' Certificate.
The Bank will promptly execute and deliver, or cause to be
executed and delivered, to the Fund all notices, proxies and proxy soliciting
materials with respect to such securities, such proxies to be executed by the
registered holder of such securities (if registered otherwise than in the name
of the Fund), but without indicating the manner in which such proxies are to be
voted.
(a) Book-Entry System. Provided (i) the Bank has received a
certified copy of a resolution of the Board specifically approving deposits of
Fund assets in the Book-Entry System, and (ii) for each year following such
approval, the Board has reviewed and approved the arrangement and has not
delivered an Officer's Certificate to the Bank indicating that it has withdrawn
its approval:
<PAGE>
1. The Bank may keep Securities of the Fund in the Book-
Entry System provided that such securities are represented in an account
("Account") of the Bank (or its agent) in such System which shall not include
any assets of the Bank (or such agent) other than assets held as a fiduciary,
custodian, or otherwise for customers.
2. The records of the Bank (and any such agent) with
respect to the Fund's participation in the Book-Entry System through the Bank
(or any such agent) will identify by book entry securities belonging to the Fund
which are included with other securities deposited in the Account and shall at
all times during the regular business hours of the Bank (or such agent) be open
for inspection by duly authorized officers, employees or agents of the Fund.
Where securities are transferred to the Fund's account, the Bank shall also, by
book entry or otherwise, identify as belonging to the Fund a quantity of
securities in fungible bulk of securities (i) registered in the name of the Bank
or its nominee, or (ii) shown on the Bank's account on the books of the Federal
Reserve Bank.
3. The Bank (or its agent) shall pay for securities
purchased for the account of the Fund or shall pay cash collateral against the
return of securities loaned by the Fund upon (i) receipt of advice from the
Book-Entry System that such Securities have been transferred to the Account, and
(ii) the making of an entry on the records of the Bank (or its agent) to reflect
such payment and transfer for the account of the Fund. The Bank (or its agent)
shall transfer securities sold or loaned for the account of the Fund upon
(i) receipt of advice from the Book-Entry System
that payment for Securities sold or payment of the initial cash collateral
against the delivery of securities loaned by the Fund has been transferred to
the Account, and
(ii) the making of an entry on the records of the
Bank (or its agent) to reflect such transfer and payment for the account of the
Fund. Copies of all advices from the Book-Entry System of transfers of
Securities
<PAGE>
or the account of the Fund shall identify the Fund, be maintained for the Fund
by the Bank and shall be provided to the Fund at its request. The Bank shall
send the Fund a confirmation, as defined by Rule 17f-4 under the Investment
Company Act of 1940, of any transfers to or from the account of the Fund.
4. The Bank will promptly provide the Fund with any
report obtained by the Bank or its agent on the Book-Entry System's accounting
system, internal accounting control and procedures for safeguarding Securities
deposited in the Book-Entry System. The Bank will provide the Fund and cause any
such agent to provide, at such times as the Fund may reasonably require, with
reports by independent public accountants on the accounting system, internal
accounting control and procedures for safeguarding securities, including
Securities deposited in the Book-Entry System, relating to the services provided
by the Bank or such agent under the Agreement.
5. Anything to the contrary in the Agreement
notwithstanding, the Bank shall be liable to the Fund for any loss or damage to
the Fund resulting from use of the Book-Entry System by reason of any
negligence, wilful misfeasance or bad faith of the Bank or any of its agents or
of any of its or their employees or from any negligent disregard by the Bank or
any such agent of its duty to enforce effectively such rights as it may have
against the Book-Entry System; at the election of the Fund, it shall be entitled
to be subrogated for the Bank in any claim against the Book-Entry System or any
other person which the Bank or its agent may have as a consequence of any such
loss or damage if and to the extent that the Fund has not been made whole for
any loss or damage.
(b) Use of a Depository. Provided (i) the Bank has received a
certified copy of a resolution of the Fund's Board specifically approving
deposits in DTC and PTC or other such Depository; (ii) the Bank appoints any
such depository its agent; and (iii) for each year following such Board
approval, the Board has reviewed and approved the arrangement and has not
delivered an Officer's Certificate to the Bank indicating that it has withdrawn
its approval:
<PAGE>
1. The Bank may use a Depository to hold, receive,
exchange, release, lend, deliver and otherwise deal with the securities owned by
the Fund, including stock dividends, rights and other items of like nature, and
to receive and remit to the Bank on behalf of the Fund all income and other
payments thereon and to take all steps necessary and proper in connection with
the collection thereof, provided that such securities are held in an account of
the Bank (or its agent) in such Depository which shall not include any assets of
the Bank (or such agent) other than assets held as a fiduciary, custodian, or
otherwise for customers. The records of the Bank shall identify those securities
of the Trust held by the Depository.
2. Registration of the Fund's securities may be made in
the name of any nominee or nominees used by such Depository.
3. Payment for securities purchased and sold may be made
through the clearing medium employed by such Depository for transactions of
participants acting through it. Upon any purchase of securities for the account
of the Fund, payment will be made only upon delivery of the securities to or for
the account of the Fund and the Fund shall pay cash collateral against the
return of securities loaned by the Fund only upon delivery of the securities to
or for the account of the Fund; and upon any sale of securities for the account
of the Fund, delivery of the securities will be made only against payment
thereof or, in the event securities are loaned, delivery of securities will be
made only against receipt of the initial cash collateral to or for the account
of the Fund.
4. Anything to the contrary in the Agreement
notwithstanding, the Bank shall be liable to the Fund for any loss or damage to
the Fund resulting from use of a Depository by reason of any negligence, wilful
misfeasance or bad faith of the Bank or any of its agents or of any of its or
their employees or from any negligent disregard by the Bank or any such agent of
its duty to enforce effectively such rights as it may have against a Depository.
At the election of the Fund, it shall be entitled to be subrogated for the Bank
in any claim against a Depository or any other person which the Bank or its
agent may have as a consequence of any such loss or damage if and to the
<PAGE>
extent that the Fund has not been made whole for any loss or damage. In this
connection, with respect to the use of the Depository by the Bank, the Bank,
without cost to the Fund, shall ensure that:
(i) The Depository obtains replacement of any
certificated security deposited with it in the event such security is lost,
destroyed, wrongfully taken or otherwise not available to be returned to the
Bank upon its request;
(ii) Any proxy materials received by Depository with
respect to securities of the Fund deposited with such Depository are forwarded
immediately to the Bank for prompt transmittal to the Fund;
(iii) Such Depository immediately forwards to the
Bank confirmation of any purchase or sale of securities for the account of the
Fund and of the appropriate book entry made by such Depository to the Fund's
account;
(iv) Such Depository prepares and delivers to the
Bank such records with respect to the performance of the Bank's obligations and
duties hereunder as may be necessary for the Fund to comply with the
recordkeeping requirements of Section 31 (a)of the Act and Rule 31a thereunder
and such other rules and regulations relating to recordkeeping requirements of
the Fund as may be enacted from time to time; and
(v) Such Depository delivers to the Bank and the
Fund all internal accounting control reports, whether or not audited by an
independent public accountant, as well as such other reports as the Fund may
reasonably request in order to verify the Fund's securities held by such
Depository.
(c) Use of Book-Entry System for Commercial Paper. Provided
(i) the Bank has received a certified copy of a resolution of the Board
specifically approving participation in a system maintained by the Bank for the
holding of commercial paper in book-entry form ("Book Entry Paper") and
<PAGE>
(ii)for each year following such approval the Board has reviewed and approved
the arrangements, upon receipt of Proper Instructions and upon receipt of
confirmation from an Issuer (as defined below) that the Fund has purchased such
Issuer's Book Entry Paper, the Bank shall issue and hold in book-entry form, on
behalf of the Fund, commercial paper issued by issuers with whom the Bank has
entered into a book-entry agreement (the "Issuers"). In maintaining its Book
Entry Paper System, the Bank agrees that:
1. the Bank will maintain all Book Entry Paper held by
the Fund in an account of the Bank that includes only assets held by it for
customers;
2. the records of the Bank with respect to the Fund's
purchase of Book Entry Paper through the Bank will identify, by book entry,
Commercial Paper belonging to the Fund which is included in the Book Entry Paper
System and shall at all times during the regular business hours of the Bank be
open for inspection by duly authorized officers, employees or agents of the
Fund.
3. (a) The Bank shall pay for Book Entry Paper purchased
for the account of the Fund upon contemporaneous (i) receipt of advice from the
Issuer that such sale of Book Entry Paper has been effected, and (ii) the making
of an entry on the records of the Bank to reflect such payment and transfer for
the account of the Fund.
(b) The Bank shall cancel such Book Entry Paper
obligation upon the maturity thereof upon contemporaneous (i) receipt of advice
that payment for such Book Entry Paper has been transferred to the Fund, and
(ii) the making of an entry on the records of the Bank to reflect such payment
for the account of the Fund.
4. the Bank shall transmit to the Fund a transaction
journal confirming each transaction in Book Entry Paper for the account of the
Fund on the next business day following the transaction;
5. the Bank will send to the Fund such reports on its
system of internal accounting control as the Fund may reasonably request from
time to time;
<PAGE>
(d) Use of Bond Immobilization Programs. Provided (i) the
Bank has received a certified copy of a resolution of the Board specifically
approving the maintenance of portfolio securities in an immobilization program
operated by a bank which meets the requirements of Section 26(a) (1) of the
Investment Company Act of 1940, and (ii) for each year following such approval
the Board has reviewed and approved the arrangement and has not delivered an
officer's Certificate to the Bank indicating that it has withdrawn its approval,
the Bank shall enter into such immobilization program with such bank acting as a
subcustodian hereunder.
(e) Eurodollar CDs. Any Eurodollar CDs belonging to the Fund
may be physically held by the European branch of the U.S. banking institution
that is the issuer of such Eurodollar CD (a "European Branch"), provided that
such securities are identified on the books of the Bank as belonging to the Fund
and that the books of the Bank identify the European branch holding such
securities. Notwithstanding any other provision of this Agreement to the
contrary, except as stated in the first sentence of this subparagraph (e), the
Bank shall be under no other duty with respect to such Eurodollar CDs belonging
to the Fund, and shall have no liability to the Fund or its shareholders with
respect to the actions, inactions, whether negligent or otherwise of such
European Branch in connection with such Eurodollar CDs, except for any loss or
damage to the Fund resulting from the Bank's own negligence, wilful misfeasance
or bad faith in the performance of its duties hereunder.
6.3 Options and Futures Transactions.
(a) Puts and Calls Traded on Securities Exchanges, NASDAQ or
Over-the-Counter.
1. The Bank shall take action as to put options ("puts")
and call options ("calls") purchased or sold (written) by the Fund regarding
escrow or other arrangements in accordance with the provisions of any agreement
entered into upon receipt of Proper Instructions between the Bank, any broker
and, if necessary, the Fund. In the case of a call option written by the Fund,
the Bank will arrange for an escrow receipt to be issued when requested to do so
by the Fund.
<PAGE>
2. Unless another agreement requires it to do so, the
Bank shall be under no duty or obligation to see that the Fund has deposited or
is maintaining adequate margin, if required, with any broker in connection with
any option, nor shall the Bank be under duty or obligation to present such
option to the broker for exercise unless it receives Proper Instructions from
the Fund. The Bank shall, however, comply with all Proper Instructions regarding
margin and exercise of options. The Bank shall have no responsibility for the
legality of any put or call purchased or sold on behalf of the Fund, the
propriety of any such purchase or sale, or the adequacy of any collateral
delivered to a broker in connection with an option or deposited to or withdrawn
from a Segregated Account as described in sub-paragraph c of this Section 6.3.
The Bank specifically, but not by way of limitation, shall not be under any duty
or obligation to: (i) periodically check or notify the Fund that the amount of
such collateral held by a broker or held in a Segregated Account as described in
sub-paragraph (c) of this Section 6.3 is sufficient to protect such broker of
the Fund against any loss; (ii) effect the return of any collateral delivered to
a broker, provided however, the Bank shall, upon expiration of an option, return
to the Fund any collateral held by the Bank relating to such option; or (iii)
advise the Fund that any option it holds, has or is about to expire. Such duties
or obligations shall be the sole responsibility of the Fund.
(b) Puts, Calls and Futures Traded on Commodities Exchanqes.
1. The Bank shall take action as to puts, calls and
futures contracts ("Futures") purchased or sold by the Fund in accordance with
the provisions of any agreement among the Fund, the Bank and a Futures merchant
relating to compliance with the rules of the Commodity Futures Trading
Commission and/or any contract market, or any similar organization or
organizations, (including any foreign organization) regarding account deposits
in connection with transactions by the Fund.
2. The responsibilities and liabilities of the Bank as
to Futures, puts and calls traded on commodities exchanges, any Futures
Commission merchant account and the Segregated Account shall be limited as
<PAGE>
set forth in sub-paragraph (a) (2) of this Section 6.3 as if such sub-paragraph
referred to Futures Commission Merchants rather than brokers, and Futures and
puts and calls thereon instead of options.
(c) Segregated Account In Connection with Options and Futures
Transactions. The Bank shall upon receipt of Proper Instructions establish and
maintain a segregated account or accounts for and on behalf of the Fund, into
which account or accounts may be transferred cash and/or securities including
securities maintained in an Account by the Bank pursuant to Section 6.2 hereof,
(i) in accordance with the provisions of any agreement among the Fund, the Bank
and a broker or any Futures merchant, relating to compliance with the rules of
the Options Clearing Corporation and of any registered national securities
exchange or the Commodity Futures Trading Commission or any registered contract
market, or of any similar organization or organizations (including any foreign
organization) regarding escrow or other arrangements in connection with
transactions by the Fund, and (ii) for the purpose of segregating cash or
securities in connection with options purchased, or written by the Fund or
commodity futures or options thereon purchased or written by the Fund.
6.4 Segregated Account for "When-Issued," Forward Commitment,"
Reverse Repurchase Agreement Transactions and Other Purposes. Notwithstanding
any other provisions hereof, the Bank will maintain a segregated account in the
name of the Fund (i) for the deposit of liquid assets, such as cash, U.S.
Government securities or other high grade obligations, having a value (marked to
the market on a daily basis by the Bank) at all times equal to not less than the
aggregate purchase price due on the settlement dates (or such other amount as
the Fund shall indicate) of all the Fund's then outstanding forward commitment
or "when-issued" agreements relating to the purchase of portfolio securities and
all the Fund's then outstanding commitments under reverse repurchase agreements
entered into with broker-dealer firms, (ii) for the deposit of any portfolio
securities which the Fund has agreed to sell on a forward commitment basis, all
in accordance with Securities and Exchange Commission Release No. IC-10666,
(iii) for the purposes of compliance by the Fund with the procedures required by
Investment Company Act Release No. 10666, or any subsequent release or releases
or rules or regulations of the Securities and Exchange Commission relating to
the maintenance of segregated accounts by registered investment companies, (iv)
for the
<PAGE>
purpose of segregating cash or securities for the ICI Mutual Insurance Company
letter of credit, (v) for the purpose of segregating assets in connection with
the Fund's outstanding obligations under a swap, derivative or synthetic
security, and (vi) for other proper corporate purposes, but only, in the case of
clause (vi), upon receipt of an Officers' Certificate, setting forth the purpose
or purposes of such segregated account and declaring such purposes to be proper
corporate purposes. No assets shall be deposited in or withdrawn from the
segregated account except pursuant to Proper Instructions.
6.5 Interest Bearing Call or Time Deposits. The Bank shall,
upon receipt of Proper Instructions relating to the purchase by the Fund of
interest bearing fixed term and call deposits, transfer cash, by wire or
otherwise, in such amounts and to such bank or banks as shall be indicated in
such Proper Instructions. The Bank shall include in its records with respect to
the assets of the Fund appropriate notation as to the amount of each such
deposit, the banking institution with which such deposit is made (the "Deposit
Bank") , and shall retain such forms of advice or receipt evidencing the
deposit, if any, as may be forwarded to the Bank by the Deposit Bank. Such
deposits shall be deemed portfolio securities of the Fund and the responsibility
of the Bank therefore shall be the same as and no greater than the Bank's
responsibility in respect of other portfolio securities of the Fund.
7. Transfer of Securities. The Bank will transfer exchange, deliver or
release Portfolio securities held by it hereunder, insofar as such securities
are available for such purpose, provided that before making any transfer,
exchange, delivery or release under this Section the Bank will receive Proper
Instructions requesting such transfer, exchange or delivery stating that it is
for a purpose permitted under the terms of this Section 7, specifying the
applicable subsection, or describing the purpose of the transaction with
sufficient particularity to permit the Bank to ascertain the applicable
subsection, only
7.1 upon sales of Portfolio securities for the account of the
Fund, against contemporaneous receipt by the Bank of payment therefor in full,
each such payment to be in the amount of the sale price shown in the Proper
Instructions received by the Bank before such payment is made;
<PAGE>
7.2 in exchange for or upon conversion into other securities
alone or other securities and cash pursuant to any plan of merger,
consolidation, reorganization, share split-up, change in par value,
recapitalization or readjustment or otherwise, upon exercise of subscription,
purchase or sale or other similar rights represented by such Portfolio
securities, or for the purpose of tendering shares in the event of a tender
offer therefore, provided however that in the event of an offer of exchange,
tender offer, or other exercise of rights requiring the physical tender or
delivery of Portfolio securities, the Bank shall have no liability for failure
to so tender in a timely matter unless such Proper Instructions are received by
the Bank at least two business days prior to the date required for tender, and
unless the Bank (or its agent or subcustodian hereunder) has actual possession
of such security at least two business days prior to the date of tender;
7.3 upon conversion of Portfolio securities pursuant to their
terms into other securities;
7.4 for the purpose of redeeming in kind shares of common stock
of the Fund upon authorization from the Fund;
7.5 in the case of option contracts owned by the Fund, for
presentation to the endorsing broker;
7.6 when such Portfolio securities are called, redeemed or
retired or otherwise become payable;
7.7 for the purpose of effectuating the pledge of portfolio
securities held by the Bank pursuant to this Agreement in order to collateralize
loans made to the Fund by any bank, including the Bank; provided, however, that
such Portfolio securities will be released only upon payment to the Bank for the
account of the Fund of the moneys borrowed, except that in cases where
additional collateral is required to secure a borrowing already made, and such
fact is made to appear in the Proper Instructions, further portfolio securities
may be released for that purpose without any such payment;
7.8 for the purpose of releasing certificates representing
Portfolio securities of the Fund, against contemporaneous receipt by the Bank of
the fair value of such security, as set forth in Proper Instructions received by
the Bank before such payment is made;
<PAGE>
7.9 for the purpose of delivering securities lent by the Fund
to a bank or broker dealer, but only against receipt in accordance with street
delivery custom except as otherwise provided in Subsections 6.2 (a) and (b)
hereof, of adequate collateral as agreed upon from time to time by the Fund and
the Bank, and upon receipt of payment in connection with any repurchase
agreement relating to such securities entered into by the Fund;
7.10 for other authorized transactions of the Fund or for
other proper corporate purposes; provided that before making such transfer, the
Bank will also receive an Officers' Certificate specifying the portfolio
securities to be delivered, setting forth the transaction in or purpose for
which such delivery is to be made, declaring such transaction to be an
authorized transaction of the Fund or such purpose to be a proper corporate
purpose, and naming the person or persons to whom delivery of such securities
shall be made; and
7.11 upon termination of this Agreement as hereinafter set
forth pursuant to Section 9 and Section 13 of this Agreement.
7.12 for delivery in accordance with the provisions of any
agreement among the Fund, the Bank and a broker-dealer relating to compliance
with the rules of the Options Clearing Corporation and of any registered
national securities exchange, or of any similar organization or organizations
(including foreign organizations), regarding escrow or other arrangements in
connection with transactions by the Fund;
7.13 For delivery in accordance with the provisions of any
agreement among the Fund, the Bank, and a Futures commission merchant relating
to compliance with the rules of the Commodity Futures Trading Commissions or any
similar organization or organizations (including foreign organizations),
regarding account deposits in connection with transactions by the Fund.
As to any deliveries made by the Bank pursuant to subsections 7.1,
7.2, 7.3, 7.5, 7.6, 7.7, 7.8 and 7.9, securities or cash receivable in exchange
therefor shall be delivered to the Bank.
8. Redemptions. In the case of payment of assets of the Fund held by
the Bank in connection with redemptions and repurchases by the Fund of its
outstanding shares of
<PAGE>
beneficial interest, the Bank will rely on written notification by the Fund's
transfer agent of receipt of a request for redemption and certificates, if
issued, in proper form for redemption before such payment is made. Payment shall
be made in accordance with the Declaration of Trust of the Fund, from assets
available for said purpose.
9. Merger, Dissolution, etc. of Fund. In the case of the following
transactions, not in the ordinary course of business, namely, the merger of the
Fund into or the consolidation of the Fund with another investment company, the
sale by the Fund of all, or substantially all of its assets to another
investment company, or the liquidation or dissolution of the Fund and
distribution of its assets, the Bank will deliver the Portfolio securities held
by it under this Agreement and disburse cash only upon the order of the Fund set
forth in an officers' Certificate, accompanied by a certified copy of a
resolution of the Fund's Board authorizing any of the foregoing transactions.
Upon completion of such delivery and disbursement and the payment of the
preapproved fees, disbursements and expenses of the Bank, this Agreement will
terminate.
10. Actions of Bank Without Prior Authorization. Notwithstanding
anything herein to the contrary, unless and until the Bank receives an Officers'
Certificate to the contrary, it will-without prior authorization or instruction
of the Fund or the transfer agent:
10.1 Receive and hold for the account of the Fund hereunder
and deposit in the account or accounts referred to in Section 6 hereof, all
income, dividends, interest and other payments or distribution of cash with
respect to the Portfolio securities held thereunder;
10.2 Present for payment all coupons and other income items
held by it for the account of the Fund which call for payment upon presentation
and hold the cash received by it upon such payment for the account of the Fund
account or accounts referred to in Section 6 hereof;
10.3 Receive and hold for the account of the Fund hereunder
and deposit in the account or accounts referred to in Section 6 hereof all
securities received as a distribution on Portfolio securities as a result of a
stock dividend, share split-up, reorganization, recapitalization, merger,
consolidation, readjustment, distribution of rights and similar securities
issued with respect to any Portfolio securities held by it hereunder.
<PAGE>
10.4 Execute as agent on behalf of the Fund all necessary
ownership and other certificates and affidavits required by the Internal Revenue
Code or the regulations of the Treasury Department issued thereunder, or by the
laws of any state, now or hereafter in effect, inserting the Fund's name on such
certificates as the owner of the securities covered thereby, to the extent it
may lawfully do so and as may be required to obtain payment in respect thereof.
The Bank will execute and deliver such certificates in connection with Portfolio
securities delivered to it or by it under this Agreement as may be required
under the provisions of the Internal Revenue Code and any Regulations of the
Treasury Department issued thereunder, or under the laws of any State;
10.5 Present for payment all portfolio securities which are
called, redeemed, retired or otherwise become payable, and hold cash received by
it upon payment for the account of the Fund in the account or accounts referred
to in Section 6 hereof; and
10.6 Exchange interim receipts or temporary securities for
definitive securities.
The Bank shall collect any funds which are collectible arising from
Portfolio securities, including dividends, interest and other income, and shall
transmit promptly to the Fund all written information affecting such securities
including, without limitation, any call for redemption, offer of exchange,
pendency of maturity, notices regarding options and futures contracts, right of
subscription, reorganization or other proceedings.
If Portfolio securities upon which such income is payable are in
default or payment is refused after due demand or presentation, the Bank will
notify the Fund in writing of any default or refusal to pay within two business
days from the day on which it receives knowledge of such default or refusal. In
addition, the Bank will send the Fund a written report once each month showing
any income on any Portfolio security held by it which is more than ten days
overdue on the date of such report.
11. Maintenance of Records; Fund Evaluation; Accounting Services. The
Bank will maintain records with respect to transactions for which the Bank is
responsible pursuant to the terms and conditions of this Agreement, and in
compliance with the applicable rules and regulations of the Investment Company
Act of 1940 as amended, as well as
<PAGE>
applicable federal and state tax laws and all other laws and regulations which
may be applicable, and will furnish the Fund daily with a statement of assets
and liabilities and a portfolio of investments of the Fund as well as such other
calculations and reports as the Bank and Fund may agree from time to time. The
Bank will furnish to the Fund at the end of every month, and at the close of
each quarter of the Fund's fiscal year as well as at such other times as the
Fund may request, a list of the Portfolio securities and the aggregate amount of
cash held by it for the Fund. The books and records of the Bank pertaining to
its actions under this Agreement and reports by the Bank or its independent
accountants concerning its accounting system, procedures for safeguarding the
Fund's assets and internal accounting controls, which shall be of sufficient
scope and in sufficient detail as may reasonably be required by the Fund to
provide reasonable assurance that any material inadequacies would be disclosed
by such examination, and, if there are no such inadequacies, shall so state, and
will be open to inspection and audit at reasonable times by officers of or
auditors employed by the Fund as well as any other person authorized by the Fund
by Proper Instructions. The books and records relating to the Fund will be
preserved by the Bank in the manner and in accordance with the applicable rules
and regulations under the Investment Company Act of 1940 and shall be the
property of the Fund.
As custodian the Bank shall have and perform the following powers
and duties:
11.1 To keep the books of account and render statements or
copies from time to time as reasonably requested by the Treasurer or any
executive officer of the Fund.
11.2 To compute and, unless otherwise directed by the Board,
determine as of the close of business on the New York Stock Exchange on each day
on which said Exchange is open for trading or as of such other hours, if any, as
may be authorized by said Board the net asset value and the public offering
price of a share of beneficial interest of the Fund, such determination to be
made in accordance with the provisions of the Declaration of Trust of the Fund
and Prospectus and Statement of Additional Information relating to the Fund, as
they may from time to time be amended, and any applicable resolutions of the
Board at the time in force and applicable; and promptly to notify the Fund and
the National Association of Securities Dealers ("NASD") or such other persons as
the Fund may request of the results of such
<PAGE>
computation and determination. In computing the net asset value hereunder, the
Bank may rely in good faith upon information furnished in writing to it by any
Authorized Person in respect of (i) the manner of accrual of the liabilities of
the Fund and in respect of liabilities of the Fund not appearing on its books of
account kept by the Bank, (ii) reserves, if any, authorized by the Board or that
no such reserves have been authorized, (iii) the source of the quotations to be
used in computing the net asset value, (iv) the value to be assigned to any
security for which no price quotations are available, and (v) the method of
computation of the public offering price on the basis of the net asset value of
the shares, and the Bank shall not be responsible for any loss occasioned by
such reliance or for any good faith reliance on any quotations received from a
source pursuant to (iii) above.
11.3 To assist generally in the preparation of reports to
shareholders and others, audits of accounts, and other ministerial matters of
like nature.
12. Concerning the Bank.
12.1 Performance of Duties. In performing its duties hereunder
and any other duties listed on any Schedule hereto, if any, the Bank will be
entitled to receive and act upon the advice of independent counsel of its own
selection, which may be counsel for the Fund, and will be without liability for
any action taken or thing done or omitted to be done in accordance with this
Agreement in good faith in conformity with such advice, if such counsel and such
advice are approved by the Fund, provided however such approval shall not be
unreasonably withheld. In the performance of its duties hereunder, so long as it
exercises reasonable care, the Bank will be protected and not be liable, and
will be indemnified and saved harmless for any action taken or omitted to be
taken by it in good faith reliance upon the terms of this Agreement, any
Officers' Certificate, Proper Instructions, resolution of the Board, telegram,
notice, request, certificate or other instrument reasonably believed by the Bank
to be genuine and to have been sent by an Authorized Person and for any other
loss to the Fund except in the case of the Bank's negligence, wilful misfeasance
or misconduct or bad faith in the performance of its duties or negligent
disregard of its obligations and duties hereunder.
The Bank may employ agents in the performance of its duties
hereunder and the Bank shall be responsible for the acts and omissions of such
agents as if performed by the
<PAGE>
Bank hereunder. The Bank may employ subcustodians upon receipt of Proper
Instructions indicating that the Board has so approved the appointment, provided
that any such subcustodian meets at least the minimum qualifications required by
Section 17 (f) (1) of the Investment Company Act of 1940 to act as a custodian
of the Fund's assets. In order to comply with Rule 17f-5, (and 17f-4, if
applicable) of the Investment Company Act of 1940, the contract between the Bank
and any foreign subcustodian relating to securities of the Fund shall be subject
to approval of the Fund. The appointment of any subcustodian by the Bank
pursuant to this Agreement shall not relieve the Bank of its responsibilities
and liabilities under this Agreement, and the Bank shall be liable to the Fund,
to the extent of the Fund's damages, resulting from the failure of any
subcustodian to exercise reasonable care and to act in good faith without
negligence, provided however, the Bank shall not be liable for any loss
resulting from, or caused by nationalization, expropriation, currency
restrictions, acts of war or terrorism, insurrection, revolution, nuclear
fusion, fission or radiation, acts of God or other similar events or acts not
due to the failure of the Bank or any subcustodians to exercise reasonable care
in the performance of their duties. Notwithstanding the foregoing, in connection
with the Bank's liability for the performance of The Chase Manhattan Bank, N. A.
("Chase") as a subcustodian of the Fund pursuant to an agreement by and between
Chase and the Bank, which form of agreement is attached hereto (the "Chase
Agreement"), and any subcustodian of the Fund appointed under the Chase
Agreement with the approval of the Board, the "Fund's damages" for the purpose
of the preceding sentence will be determined based on the market value of the
property which is the subject of the loss at the date of discovery of such loss
and without reference to any special conditions or circumstances.
The Bank will be under no duty or obligation to inquire into and
will not be liable for:
(a) the validity of the issue of any Portfolio securities purchased
by or for the Fund, the legality of the purchases thereof or the propriety of
the price incurred therefor;
(b) the legality of any sale of any portfolio securities by or for
the Fund or the propriety of the amount for which the same are sold;
(c) the legality of an issue or sale of any shares of beneficial
interest of the Fund or the sufficiency of the amount to be received therefor;
<PAGE>
(d) the legality of the repurchase of any shares of beneficial
interest of the Fund or the propriety of the amount to be paid therefor;
(e) the legality of the declaration of any dividend by the
Fund or the legality of the distribution of any Portfolio securities as
payment in kind of such dividend; or
(f) any property or moneys of the Fund already delivered or paid by
the Bank pursuant to the terms hereof.
Moreover, the Bank will not be under any duty or obligation to
ascertain whether any Portfolio securities at any time delivered to or held by
it for the account of the Fund are such as may properly be held by the Fund
under the provisions of its Declaration of Trust or By-Laws, any federal or
state statutes or any rule or regulation of any governmental agency.
12.2 Fees and Expenses of Bank. The Fund will pay or reimburse
the Bank from time to time for any transfer taxes payable upon transfer of
Portfolio securities made hereunder, and for all necessary proper disbursements,
expenses and charges made or incurred by the Bank in the performance of this
Agreement (including any duties listed on any Schedule hereto, if any) including
any indemnities for any loss, liabilities or expense to the Bank as specifically
provided above. For the services rendered by the Bank hereunder, the Fund will
pay to the Bank such compensation or fees at such rate and at such times as
shall be agreed upon in writing by the parties from time to time. The Bank will
also be entitled to reimbursement by the Fund for all preapproved expenses
incurred in conjunction with termination of this Agreement by the Fund.
12.3 Advances by Bank. The Bank may, in its sole discretion,
advance funds on behalf of the Fund to make any payment permitted by this
Agreement upon receipt of any proper authorization required by this Agreement
for such payments by the Fund. Should such a payment or payments, with advanced
funds, result in an overdraft (due to insufficiencies of the Fund's account with
the Bank, or for any other reason) this Agreement deems any such or related
indebtedness, a loan made by the Bank to the Fund payable on demand and bearing
interest at the rate set forth in writing by the Bank concurrently herewith (as
amended from time to
<PAGE>
time) unless the Fund shall provide the Bank with agreed upon compensating
balances. The Fund agrees that the Bank shall have a continuing lien and
security interest on the assets of the Fund to the extent of any overdraft,
provided that in no event shall the amount of such lien exceed the lesser of (i)
the amount of such overdraft or (ii) 1O% of the Fund's gross assets on the date
of such overdraft, and provided further that to the extent consistent with the
foregoing, the Bank will comply with any Proper Instructions indicating which
Portfolio securities and/or which account of the Fund shall be subject to such
lien. If such overdraft is not repaid within a reasonable period of time, the
Bank shall have the right to exercise any rights it may have as a lienholder or
secured party.
13. Termination.
13.1 This Agreement may be terminated at any time without
penalty upon sixty days written notice delivered by either party to the other by
means of registered mail, and upon the expiration of such sixty days this
Agreement will terminate; provided, however, that the effective date of such
termination may be postponed to a date not more than ninety days from the date
of delivery of such notice (i) by the Bank in order to prepare for the transfer
by the Bank of all of the assets of the Fund held hereunder, and (ii) by the
Fund in order to give the Fund an opportunity to make suitable arrangements for
a successor custodian. The Fund may immediately terminate this Agreement: (i) in
the event of the appointment of a conservator or receiver for the Bank or upon
the happening of a like event; (ii) if the Bank shall make a general assignment
for the benefit of creditors; admit in writing its inability to pay its debts as
they become due; file a petition in bankruptcy or a petition seeking any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any present or future bankruptcy, reorganization,
insolvency or similar statute, law or regulation or seek the appointment of any
trustee, receiver, custodian or liquidator of the Bank or of all or
substantially all of its properties; (iii) if a proceeding is commenced against
the Bank seeking relief or an appointment of a type described in paragraph
13.1(ii) above and such proceeding is not dismissed within 30 days after the
commencement thereof; (iv) if the Bank's insurance is materially adversely
changed. At any time after the termination of this Agreement, the Fund will, at
its request, have access to the records of the Bank relating to the performance
of its duties as custodian.
<PAGE>
13.2 In the event of the termination of this Agreement, the
Bank will immediately upon receipt or transmittal, as the case may be, of notice
of termination, commence and prosecute diligently to completion the transfer of
all cash and the delivery of all Portfolio securities duly endorsed and all
records maintained under Section 11 to the successor custodian when appointed by
the Fund. The obligation of the Bank to deliver and transfer over the assets of
the Fund held by it directly to such successor custodian will commence as soon
as such successor is appointed and will continue until completed as aforesaid.
If the Fund does not select a successor custodian within ninety (90) days from
the date of delivery of notice of termination the Bank may, subject to the
provisions of subsection 13.3 of this Section 13, deliver the Portfolio
securities and cash of the Fund held by the Bank to a bank or trust company of
its own selection which meets the requirements of Section 17(f) (1) of the
Investment Company Act of 1940 and has a reported capital, surplus and undivided
profits aggregating not less than $25,000,000, to be held as the property of the
Fund under terms similar to those on which they were held by the Bank, whereupon
such bank or trust company so selected by the Bank will become the successor
custodian of such assets of the Fund with the same effect as though selected by
the Board.
13.3 Prior to the expiration of ninety (90) days after notice
of termination has been given, the Fund may furnish the Bank with an order of
the Fund advising that a successor custodian cannot be found willing and able to
act upon reasonable and customary terms and that there has been submitted to the
Board of the Fund the question of whether the Fund will be liquidated or will
function without a custodian for the assets of the Fund held by the Bank. In
that event the Bank will deliver the Portfolio securities and cash of the Fund
held by it, subject as aforesaid, in accordance with one of such alternatives
which may be approved by the requisite vote of the Board, upon receipt by the
Bank of a copy of such vote certified by the Fund's Secretary or Assistant
Secretary.
14. Notices. Any notice or other instrument in writing authorized or
required by this Agreement to be given to either party hereto will be
sufficiently given if addressed to such party and mailed or delivered to it at
its office at the address set forth below; namely:
<PAGE>
(a) In the case of notices sent to the Fund to:
Treasurer,
MFS Variable Insurance Trust
c/o Massachusetts Financial Services Company
500 Boylston Street
Boston, MA 02116
(b) In the case of notices sent to the Bank to:
Investors Bank & Trust Company
One Lincoln Plaza
P.O. Box 1537
Boston, Massachusetts 02205-1537
or at such other place as such party may from time to time designate in
writing.
15. Amendments. This Agreement may not be altered or amended, except
by an instrument in writing, executed by both parties, and in the case of the
Fund, any alteration or amendment which is material will be authorized and
approved by its Board.
16. Parties. This Agreement will be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns;
provided, however, that this Agreement will not be assignable by the Fund
without the prior written consent of the Bank or by the Bank without the prior
written consent of the Fund, authorized and approved by its Board; and provided
further that termination proceedings pursuant to Section 13 hereof will not be
deemed to be an assignment within the meaning of this provision.
17. Governing Law. This Agreement and all performance hereunder will
be governed by the laws of the Commonwealth of Massachusetts.
18. Interpretive and Additional Provisions. In connection with the
operation of this Agreement, the Bank and the Fund may from time to time agree
on such provisions interpretive of or in addition to the provisions of this
Agreement as may in their joint opinion be consistent with the general tenor of
this Agreement. Any such interpretive or additional provisions shall be in
writing signed by both parties and shall be annexed hereto and shall be binding
upon the parties hereto as if incorporated into this Agreement, provided
however, no such interpretive or additional provisions shall be deemed to be an
alteration or amendment of this Agreement.
<PAGE>
19. Delegation of Certain Duties to Massachusetts Financial Services
Company ("MFS"). The Bank, with the prior written consent of MFS, may delegate
to MFS the performance of any or all of the duties it has agreed to perform for
the Fund in a separate written agreement relating to (i) accounting for
investments in currency and for financial instruments (including, without
limitation, options contracts, futures contracts, options on futures contracts,
options on foreign currency and forward foreign currency exchange contracts) and
(ii) federal and state regulatory compliance. The Bank shall compensate MFS for
the performance of such duties at such fee or fees as MFS shall determine to be
equal to MFS' cost for performing such duties (the "MFS Fees") Following its
payment of MFS Fees to MFS, the Bank shall recover the amount of the MFS Fees
from the Fund on such terms as the Bank and the Fund shall agree. MFS assumes
responsibility for all duties delegated to it by the Bank pursuant to this
Section 19, and the Bank may rely on MFS for the accuracy and correctness of the
accounting information provided by MFS to the Bank pursuant to this Section 19.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate and their respective corporate seals to be affixed hereto
as of the date first above written by their respective officers thereunto duly
authorized.
MFS VARIABLE INSURANCE TRUST
By: A. KEITH BRODKIN
A. Keith Brodkin
ATTEST:
INVESTORS BANK & TRUST COMPANY
By HENRY M. JOYCE
Henry M. Joyce
ATTEST: J. M. KEENAN
J. M. Keenan
The officer of the Fund signing this Agreement is executing this Agreement not
individually but in his capacity as an officer of the Fund. The obligations of
the Fund under this Agreement are not binding upon any of the trustees,
officers, employees, agents or shareholders of the Fund individually, but bind
only the trust estate of the Fund.
<PAGE>
EXHIBIT NO. 99.9(a)
MFS VARIABLE INSURANCE TRUST
500 Boylston Street
Boston, Massachusetts 02116
April 14, 1994
MFS Service Center, Inc.
500 Boylston Street
Boston, Massachusetts 02116
Shareholder Servicing Agent Agreement
Dear Sir:
MFS Variable Insurance Trust, which is a Massachusetts business trust
(referred to as the "Trust") with twelve series, MFS OTC Series, MFS Growth
Series, MFS Research Series, MFS Growth With Income Series, MFS Total Return
Series, MFS Utilities Series, MFS High Income Series, MFS World Governments
Series, MFS Strategic Fixed Income Series, MFS Bond Series, MFS Limited Maturity
Series, and MFS Money Market Series (each a "Fund"), is an open-end registered
investment company. The Trust has selected you to act as each Fund's 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 on behalf of each Fund 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 each Fund as well as for other investment
companies (such investment companies, together with each 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
<PAGE>
termination of this Agreement, you shall cease to use such name or any similar
name within a reasonable period of time.
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 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 on behalf of each Fund.
4. Standard of Service. As Agent for each 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 each 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 each Fund; and
(f) Prompt reconciliation of all bank accounts under your control
belonging to each 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
such acting MFS Fund remains reasonably of the view that the service provided by
you, in the particulars specified, does not meet the Standard, then the MFS
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 Funds, who are not interested persons of MFS), elect to terminate this
Agreement for cause as to each such MFS Fund upon 90 days notice to you. Upon
termination hereof, the Trust, on behalf of each 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.
<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 any or
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
each Fund and that all such records and other data shall be furnished without
additional charge, except for actual processing costs, to each Fund in machine
readable as well as printed form immediately upon termination of this Agreement
or at each Fund's request. You shall safeguard and maintain the confidentiality
of each Fund's data and information supplied to you by each Fund and you shall
not transfer or disclose each Fund's data to any third party without each 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 any 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 each Fund
for out-of-pocket expenses reasonably incurred by you on behalf of each such
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.
<PAGE>
8. Record Keeping. You will maintain records in a form acceptable to
each 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 each Fund and will be
available for inspection and use by each 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 Trust on behalf of each 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 such Fund hereunder. In addition, the Trust on behalf of each 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 such 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 such 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 Trust on behalf of a 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 such Fund promptly concerning any situation which
presents or appears likely to present a claim for indemnification against such
Fund. The Trust on behalf of such 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 Trust on behalf of such Fund so elects such defense shall be
conducted by counsel chosen by the Trust on behalf of such Fund and satisfactory
to you and it will so notify you, and thereupon the Trust on behalf of such 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 Trust on behalf of a Fund 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.
If any officer of the Trust shall no longer be vested with
authority to sign for the Trust, written notice thereof shall forthwith be given
to you by the Trust and until receipt of such
<PAGE>
notice by it, you shall be fully indemnified and held harmless by the Trust in
recognizing and acting upon certificates or other instruments bearing the
signatures or facsimile signatures of such officer.
10. Insurance. You will notify each Fund should any of your insurance
coverage, as set forth on Exhibit B 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. 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 Trust (on
behalf of all Funds or any Fund) to you or by you to the Trust. Upon termination
hereof, the terminating Funds 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 Trust
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 Trust by written notice to you, you will, promptly upon such termination and
at the expense of the terminating Funds, transfer to such successor a certified
list of the shareholders of each terminating 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 Trust (if such form differs
from the form in which you have maintained the same, the Trust on behalf of such
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.
<PAGE>
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 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 by the Trust on behalf of each Fund by the
undersigned not individually, but in the capacity indicated, 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.
Very truly yours,
MFS VARIABLE INSURANCE TRUST
By: A. KEITH BRODKIN
A. Keith Brodkin
Chairman and President
The foregoing is hereby accepted as of the date thereof.
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By: JEFFREY L. SHAMES
Jeffrey L. Shames
President
The foregoing is hereby accepted as of the date thereof.
MFS SERVICE CENTER, INC.
By: JOSEPH RECOMENDES
Joseph Recomendes
President
<PAGE>
As of January 1, 1995
EXHIBIT A TO SHAREHOLDER SERVICING AGENT AGREEMENT (THE "AGREEMENT")
MFS VARIABLE INSURANCE TRUST
Pursuant to Section 7 of the Agreement, the fees to be paid by each
Fund to MFS Service Center, Inc. ("MFSC"), for MFSC's services as shareholder
servicing agent under the Agreement, are 0.035% per annum of each Fund's average
daily net assets.
MFS VARIABLE INSURANCE TRUST
By: A. KEITH BRODKIN
A. Keith Brodkin
Chairman and President
MFS SERVICE CENTER, INC.
By: JOSEPH A. RECOMENDES
Joseph A. Recomendes
President
<PAGE>
Exhibit B
MFS Service Center, Inc.
Summary of Insurance Coverage
1. Fidelity Bond
MFS Service Center, Inc. ("MFSC") is a named insured on the Massachusetts
Financial Services Company ("MFS") fidelity bonds that cover losses incurred
under the following circumstances:
a) Any larceny or embezzlement committed by an employee, whether alone or
through collusion; and
b) Any loss of property, offices, or equipment through robbery,
burglary, larceny, hold- up, misplacement, unexplainable disappearance, damage
or destruction thereof and in transit coverage while in custody of any person
acting as messenger.
Total coverage: $55 million
Policy Insurance Company
$40mm primary coverage National Union Fire Insurance Co. of
Pittsburgh, PA/Chubb Federal Insurance
Co.(co-surety)
$15mm excess of $40mm ICI Mutual Insurance Co.
2. Errors & Omissions Insurance
The MFS Errors and Omissions insurance policy lists MFSC as a named
insured and covers against liabilities imposed by law by reason of
negligent acts, errors or accidental omissions, including costs and expenses
in defense of claims for which indemnity is provided.
Total coverage: $20 million
Policy Insurance Company
$10mm primary coverage National Union Fire Insurance Co. of
Pittsburgh, PA
$10mm excess of $10mm ICI Mutual Insurance Co.
<PAGE>
3. Lost Certificate Insurance
MFSC maintains its own Lost Certificate insurance policy with Seaboard
Surety which covers securities lost in the mail or lost by shareholders once
received.
4. Package Policy and Umbrella Liability Insurance
MFS and its subsidiaries, including MFSC, insure their personal
property (furniture, leasehold improvements, and electronic data processing
equipment) for fire insurance and liability coverage. Presently, fire insurance
coverage purchased from Chubb/Federal Insurance Company approximates $53
million. General liability coverage of $1 million for a combined single limit is
also included. Additionally, MFS and its subsidiaries are covered by a $30
million umbrella liability insurance policy above our general liability policy
limits.
5. Extra Expense
MFS and its subsidiaries, including MFSC, purchase Extra Expense
insurance as part of the Package Policy provided by Chubb/Federal Insurance
Company. Extra Expense covers additional expenses incurred in order to remain in
business while premises or equipment are being repaired or replaced. Presently
the limits are $5 million for contents and a separate $5 million for electronic
data processing.
6. Non-owned Automobile Liability Insurance
MFS and its subsidiaries, including MFSC, purchase $1 million combined
single limit insurance coverage for bodily injury and property damage from
Chubb\Federal Insurance Company. This coverage applies for all autos rented by
personnel. Excess coverage beyond these limits is insured by the umbrella
liability policy.
7. Worker's Compensation
MFS and its subsidiaries, including MFSC, purchase Worker's
Compensation insurance for the entire staff. The policy provides the benefits
required by state law.
<PAGE>
EXHIBIT NO. 99.9(b)
MFS VARIABLE INSURANCE TRUST
500 Boylston Street
Boston, MA 02116
April 14, 1994
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
Dividend Disbursing Agency Agreement
Dear Sirs:
The above-referenced trust (the "Trust") on behalf of each series
(referred to individually as a "Fund" and collectively as the "Funds") 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 each Fund'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;
<PAGE>
(d) Meeting the requirements of any governmental authority
having jurisdiction over you or any Fund; and
(e) Prompt reconciliation of all bank accounts under your
control belonging to any Fund.
If the Trust 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 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 with respect to any Funds for cause upon 90 days notice to you.
Upon termination hereof with respect to any Fund, that 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.
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
each Fund and that all such records and other data shall be furnished without
additional charge, except for actual processing costs, to each Fund in machine
readable as well as printed form immediately upon termination of this Agreement
or at a Fund's request. You shall safeguard and maintain the confidentiality of
each Fund's data and information supplied to you by each Fund and you shall not
transfer or disclose each 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 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 a Fund 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 each Fund
for out-of-pocket expenses reasonably incurred by you on behalf of each Fund,
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
each 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 each Fund and will be
available for inspection and use by each Fund or each Fund's transfer agent.
<PAGE>
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. Each 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 that Fund
hereunder. In addition, each 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 given, executed or orally
communicated by any person duly authorized by that Fund or as a result of acting
in accordance with written or oral advice reasonably believed by you to have
been given by counsel for that 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 a Fund may be asked to
indemnify you or hold you harmless, that Fund shall be advised of all pertinent
facts concerning the situation in question and you will use reasonable care to
identify and notify that Fund promptly concerning any situation which presents
or appears likely to present a claim for indemnification against that Fund. Each
Fund shall have the option to defend you against any claim which may be the
subject of this indemnification, and in the event that a Fund so elects such
defense shall be conducted by counsel chosen by that Fund and satisfactory to
you and it will so notify you, and thereupon that 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 a Fund will be
asked to indemnify you except with such Fund'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.
<PAGE>
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 (on
behalf of all Funds or any Fund) to you or by you to the Trust. Upon termination
hereof, the terminating Funds 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 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 terminating Funds, 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 on behalf of such
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 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.
<PAGE>
Very truly yours,
MFS VARIABLE INSURANCE TRUST
By: A. KEITH BRODKIN
A. Keith Brodkin
Chairman
Attest:
The foregoing is hereby accepted as of the date thereof
STATE STREET BANK AND TRUST COMPANY
By: JOHN HENRICH
John Henrich
<PAGE>
EXHIBIT NO. 99.13
MFS
MASSACHUSETTS FINANCIAL SERVICES COMPANY
500 BOYLSTON STREET o BOSTON o MASSACHUSETTS 02116-3741
617 o 954-5000
March 24, 1994
MFS Variable Insurance Trust
500 Boylston Street
Boston, MA 02116
Gentlemen:
In connection with the purchase by the undersigned of 17,850 Shares of
Beneficial Interest (without par value) of MFS Variable Insurance 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
A. Keith Brodkin
Chairman & President
