SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
FILED BY THE REGISTRANT [X] FILED BY A PARTY OTHER
THAN THE REGISTRANT [ ]
--------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX:
[X] Preliminary Proxy Statement
[ ] Confidential for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
MFS Multimarket Income Trust
--------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total Fee Paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
--------------------------------------------------------------------------------
ENVELOPE COPY:
4.5 MILLION MFS FUND ACCOUNT HOLDERS ARE COUNTING ON YOU.
PLEASE VOTE ALL OF YOUR PROXIES.
------------------------------------------------------------------------------
[text]
THE 2001 MFS FUNDS SHAREHOLDER PROXY
STREAMLINED PROCESSES FOR GREATER EFFICIENCIES
Starting in August 2001, the MFS funds are asking all of their account holders
for their support by voting on the 2001 proxy. That means that more than 4.5
million account holders will receive a proxy. Because this is such a massive
undertaking, these proxy mailings will be sent in groups from late August
through mid-September.
Your proxy vote is important. It is your right and it is your responsibility to
your fellow shareholders.
ALL SHARES IN ALL ACCOUNTS MUST BE VOTED.
If you have more than one account, you'll receive more than one proxy - possibly
even in the same package. To conserve mailing costs, we have tried to send all
of your proxies together. However, the staggered mailings may mean that you'll
get several of these "householded" packages. It's very important that you vote
every proxy that you receive. Otherwise, there may not be enough votes to
conduct the shareholder meetings. And that will require costly follow-up
mailings to non-voting account holders.
Proxy mailings are a fund expense, so are follow-up
solicitations and mailings. Please vote all of your proxies
now and save your fund some money.
FOCUS ON SIMPLIFICATION
The proposals contained in the proxy for each fund vary in the specifics but the
general theme for most of them is the same: simplification. For example, we
currently have three different Boards of Trustees; we believe it would be more
efficient if we had just one. The Issues and answers in plain English that
follow will explain the proxy process and help you wade through the proposals.
Please take the time to read the enclosed proxy material and vote your proxy.
You can vote by
o Mailing your completed and signed proxy card in the enclosed postage paid
envelope
o Voting on the internet
o Voting by telephone on a toll-free number
You'll find the complete voting instructions included in this package.
Both we and your fellow shareholders thank you for voting now. We look forward
to hearing from you.
ISSUES AND ANSWERS IN PLAIN ENGLISH
1. WHO IS ASKING FOR MY VOTE?
The Trustees of your MFS fund(s) are asking you to vote on several proposals
at the upcoming shareholder meetings. The election of new Trustees requires a
shareholder vote, and MFS recommended to the Trustees that certain other
changes be made.
2. HOW DO THE TRUSTEES RECOMMEND SHAREHOLDERS TO VOTE?
The Trustees recommend that you vote FOR all proposals.
3. WHO IS ELIGIBLE TO VOTE?
If you were the shareholder of record on the record date, you are entitled to
vote at the meeting or any adjournment of the meeting. You may cast one vote
for each share of record that you own on each matter presented at the meeting
that affects your fund.
4. WHAT WILL I BE ASKED TO VOTE ON?
O TO ELECT A BOARD OF TRUSTEES
The purpose of this proposal is to streamline the oversight of the MFS funds
by creating a combined Board that will oversee all MFS funds organized in the
United States. Currently, three separate Boards of Trustees serve the MFS
funds. Due to a number of pending Trustee retirements, the combined board
will avoid the need to add new Trustees to the various boards in the near
future.
This proposal would consolidate the separate Boards into one Board that
serves all MFS funds. The combined Board would reduce the duplication of
Board materials and reports and avoid repeated presentations by the same
personnel at different meetings.
O TO AUTHORIZE THE TRUSTEES TO ADOPT AN AMENDED AND RESTATED DECLARATION OF
TRUST
The Declaration of Trust is the charter document that describes how a fund
conducts business and how it is governed.
This proposal would modernize the Declaration of Trust and make it the same
for almost all MFS funds.
O TO AMEND, REMOVE, OR ADD CERTAIN FUNDAMENTAL INVESTMENT POLICIES
The MFS funds have certain fundamental investment policies that cannot be
changed without shareholder approval. Some of these policies are no longer
needed due to changes in applicable laws, and can now be eliminated or
revised.
This proposal would modernize the funds' fundamental investment policies and
make them the same for almost all of the MFS funds. The funds will continue
to be managed in accordance with the investment policies described in their
prospectuses. The Trustees do not expect that the revised policies will
change significantly the level of investment risk associated with an
investment in the funds.
O TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT WITH MFS
Each MFS fund has an Investment Advisory Agreement with MFS.
This proposal would modernize these Agreements and make them the same for
almost all of the MFS funds. UNDER THIS PROPOSAL, THE INVESTMENT MANAGEMENT
FEE PAYABLE BY THE FUNDS WOULD NOT CHANGE.
O TO RATIFY THE SELECTION OF THE INDEPENDENT PUBLIC ACCOUNTANTS FOR THE CURRENT
FISCAL YEAR.
This is a standard, routine item on proxy statements.
5. HOW WILL MY VOTES BE RECORDED?
Votes that are received prior to a fund's shareholder meeting will be voted
as you specify on each proposal. If you simply sign and date the proxy card,
but do not specifically vote on one or more of the proposals, your shares
will be voted FOR all of the non-specified proposals.
6. WHAT IF I WANT TO REVOKE MY PROXY?
You can revoke your proxy at any time by sending us a written revocation or a
more recently dated proxy card. Your request or new proxy card must be
received before the shareholder meeting.
7. WHAT HAPPENS IF THERE AREN'T ENOUGH VOTES TO APPROVE A PROPOSAL BY THE
SHAREHOLDER MEETING DATE?
The shareholder meeting for that fund will be adjourned to a later date, and
shareholders who have not voted will be solicited again. Follow-up
solicitations, which are a fund expense, are costly. That's why your vote is
so important and why we urge you to vote your proxy now. You should also know
that a fund may adjourn its meeting more than once.
8. HOW CAN I GET MORE INFORMATION ABOUT THE FUNDS?
A copy of the annual report for each fund was mailed previously to you. If
you would like us to send you free copies of any fund's most recent annual
report or semi-annual report, please call us toll-free at 800-225-2606 or
write to the funds at MFS Service Center, Inc., 2 Avenue de Lafayette,
Boston, Massachusetts 02111-1738.
9. WHOM DO I CALL IF I HAVE QUESTIONS?
You may call Georgeson Shareholder Communications Inc. ("Georgeson"), the
MFS funds proxy solicitor, at 888-832-6971.
Your vote is important to us and to your fellow shareholders. Please vote your
proxies as soon as possible and return them in the envelope provided.
We look forward to receiving your vote.
MFS Multimarket Income Trust
500 Boylston Street
Boston, Massachusetts 02116
August 10, 2001
Dear Shareholder:
An annual meeting of shareholders of MFS Multimarket Income Trust
(referred to as the Fund) will be held at the Fund's offices, 500 Boylston
Street, Boston, Massachusetts, on October 12, 2001, at 9:30 a.m. (Boston time).
At the meeting, you will be asked to elect Trustees of your Fund.
Certain nominees already serve as Trustees, and other nominees are currently
Trustees of other MFS funds. The new Board will combine your Fund's current
Trustees with Trustees supervising other funds in the MFS Family of Funds. The
combined Board is designed to simplify and streamline oversight of all funds in
the MFS Family of Funds.
You will also be asked to approve an amended and restated declaration
of trust, the revision or elimination of certain investment policies and a new
investment advisory agreement. These items are designed to modernize and
standardize the agreements and investment restrictions governing the funds in
the MFS Family of Funds, including your Fund, and to provide for efficiencies
and flexibility in the Fund's operations.
As a shareholder, you cast one vote for each share you own. THE
TRUSTEES RESPONSIBLE FOR YOUR FUND UNANIMOUSLY RECOMMEND THAT YOU VOTE FOR EACH
OF THESE PROPOSALS.
If you cannot attend the meeting, you may participate by proxy. After
you have reviewed the enclosed materials, please cast your vote on the enclosed
proxy card or vote by telephone or over the Internet. Instructions for telephone
and Internet voting are enclosed.
YOUR VOTE ON THESE MATTERS IS IMPORTANT. PLEASE VOTE PROMPTLY BY
COMPLETING AND SIGNING THE PROXY CARD AND RETURNING IT IN THE ENVELOPE PROVIDED
OR BY FOLLOWING THE ENCLOSED INSTRUCTIONS TO VOTE BY TELEPHONE OR OVER THE
INTERNET.
If you have any questions about the proposals to be voted on, please
call Georgeson Shareholder Communications Inc. at 1-888-832-6971.
Thank you for your participation in the meeting.
Sincerely,
Jeffrey L. Shames
Chairman
MFS MULTIMARKET INCOME TRUST
500 BOYLSTON STREET
BOSTON, MASSACHUSETTS 02116
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 12, 2001
An Annual Meeting of Shareholders of MFS Multimarket Income Trust (referred to
as the Fund) will be held at the Fund's offices, 500 Boylston Street, Boston,
Massachusetts, at 9:30 a.m. (Boston time) on Friday, October 12, 2001, for the
following purposes:
ITEM 1. To elect a Board of Trustees, 10 of whom are independent of the Fund's
investment adviser.
ITEM 2. To authorize the Trustees to adopt an Amended and Restated Declaration
of Trust.
ITEM 3. To amend or remove certain fundamental investment policies.
ITEM 4. To approve a new investment advisory agreement with Massachusetts
Financial Services Company.
ITEM 5. To ratify the selection of the independent public accountants for the
current fiscal year.
ITEM 6. To transact such other business as may properly come before the
Meeting and any adjournments thereof.
YOUR TRUSTEES RECOMMEND THAT YOU VOTE FOR ALL ITEMS.
Shareholders of record on July 27, 2001 are entitled to vote at the Annual
Meeting of Shareholders and at any adjournments thereof.
Stephen E. Cavan, Secretary and Clerk
August 10, 2001
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of proxies
by and on behalf of the Board of Trustees of MFS Multimarket Income Trust
(referred to as the Fund) to be used at the Annual Meeting of Shareholders of
the Fund to be held at 9:30 a.m. on Friday, October 12, 2001 at the Fund's
offices, 500 Boylston Street, Boston Massachusetts, and at any adjournment
thereof. The Meeting will be held for the purposes set forth in the accompanying
Notice. If the enclosed form of proxy is executed and returned, it may
nevertheless be revoked prior to its exercise by a signed writing filed with the
Secretary of the Fund or delivered at the Meeting. Solicitation of proxies is
being made by the mailing of this Notice and Proxy Statement with its enclosures
on or about August 27, 2001.
Shareholders of record at the close of business on July 27, 2001 will be
entitled to one vote for each share held. The number of shares of the Fund
outstanding on July 27, 2001 was __________.
The mailing address of the Fund is 500 Boylston Street, Boston, Massachusetts
02116. A copy of the Annual or Semi-Annual Report for the Fund may be obtained
without charge by contacting MFS Service Center, Inc., P.O. Box 9024, Boston,
Massachusetts 02205-9824, or calling MFS by telephone toll-free 1-800-637-2304.
VOTE REQUIRED: Each nominee named in Item 1 must be elected by a plurality of
the shares of the Fund voted at the Meeting. Approval of Item 2 requires the
affirmative vote of 66 and 2/3% of the shares of the Fund outstanding and
entitled to vote. Approval of Items 3 and 4 requires the affirmative vote of a
"majority of the outstanding voting securities" of the Fund. Approval of Item 5
requires the affirmative vote of a majority of the shares of the Fund voted at
the Meeting.
Under applicable law, the vote of "a majority of the outstanding voting
securities" means the affirmative vote of the lesser of (a) 67% or more of the
voting securities of the Fund that are present at the Meeting or represented by
proxy if holders of more than 50% of the outstanding voting securities of the
Fund are present or represented by proxy or (b) more than 50% of the outstanding
voting securities of the Fund.
The following table summarizes these voting requirements:
Vote Required for Approval
--------------------------
Item 1 Each nominee must be elected by a
(Election of Trustees) plurality of the shares of the
Fund voted at the Meeting
Item 2 Approved by 66 and 2/3% of the
(Approval of Amended and Restated shares of the Fund outstanding and
Declaration of Trust) entitled to vote
Item 3 Approved by a "majority of the
(Changes to Fundamental Investment outstanding voting securities"
Policies) of the Fund
Item 4 Approved by a "majority of the
(Approval of Investment Advisory outstanding voting securities"
Agreement) of the Fund
Item 5 Approved by a majority of the
(Ratification of Selection of shares of the Fund voted at the
Auditors) Meeting
GENERAL BACKGROUND
At the meeting, you will be asked to elect Trustees of your Fund. Certain
nominees already serve as Trustees, and other nominees are currently Trustees of
other MFS funds. The new Board will combine your Fund's current Trustees with
Trustees supervising other funds in the MFS Family of Funds. The combined Board
is designed to simplify and streamline oversight of the funds in the MFS Family
of Funds, including the Fund.
You will also be asked to approve an amended and restated declaration of trust,
the revision or elimination of certain investment policies and a new investment
advisory agreement. These items are designed to modernize and standardize the
agreements and restrictions governing the funds in the MFS Family of Funds,
including the Fund, and to provide for efficiencies and flexibility in the
Fund's operations.
If approved, each proposal will take effect on January 1, 2002, or in the event
that shareholder approval has not been obtained by that date, as soon as
reasonably practicable after shareholders have approved the proposal.
ITEM 1 -- TO ELECT A BOARD OF TRUSTEES.
At the Meeting, you will be asked to elect a Board of Trustees for your Fund.
The existing Trustees of the Fund have determined, pursuant to the Fund's
declaration of trust, that the number of Trustees of the combined Board of the
Fund shall be fixed for the time being at 13. Proxies not containing specific
instructions to the contrary will be voted for the election as Trustees of the
13 nominees listed below.
Currently, funds in the MFS Family of Funds are served by three separate Boards
of Trustees. Under this proposal, the separate Boards will be consolidated so
that the same individuals serve on the Boards of all of the MFS Funds.
Historically, the three separate Boards have had separate meetings but often
have reviewed the same policy issues, contractual arrangements and other
matters. Among other potential efficiencies, consolidating into one Board would
reduce the duplication of Board materials and reports covering the same topics
and would avoid the need for repeated presentations by the same personnel at
different meetings. The Trustees of the three Boards, including the Trustees of
your Fund, have agreed that both the MFS Funds and their adviser, Massachusetts
Financial Services Company (referred to as MFS), would enjoy efficiencies and
potential future cost savings if the same individuals served as Trustees of all
of the MFS Funds.
The Trustees who currently supervise your Fund are John W. Ballen, William R.
Gutow, J. Atwood Ives, Lawrence T. Perera, William J. Poorvu, Charles W.
Schmidt, Arnold D. Scott, Jeffrey L. Shames, Elaine R. Smith and David B. Stone.
The Trustees who currently supervise your Fund have served in that capacity
continuously since originally elected or appointed. These Trustees, other than
Messrs. Schmidt and Stone who will be retiring at the end of 2001, are nominees
to serve on the combined Board of the MFS Funds.
The other nominees listed on page __ were nominated by your Fund's Board of
Trustees on June 20, 2001, subject to approval by the applicable shareholders.
These nominees do not currently serve as Trustees of your Fund, but have agreed
to do so if elected by shareholders. These nominees currently serve on one other
Board of the MFS Funds, and have served in that capacity continuously since
originally elected or appointed.
The Board of Trustees of your Fund is currently divided into three
classes, each having a term of three years. Each year the term of one class
expires. The term of office of the class containing Messrs. Ives and Perera
expires at this annual meeting of shareholders. The terms of office of Messrs.
Schmidt and Stone would have expired at the 2002 and 2003 annual meetings of
shareholders, respectively, but these Trustees will be retiring at the end of
2001. In connection with the election of the new Trustees and the anticipated
retirement of Messrs. Schmidt and Stone, the new Trustees will be assigned to
particular classes and existing Trustees may be assigned to new classes in order
to achieve a balanced number of Trustees among the classes. The proposed new
class assignments are listed below. Each Trustee's term of office will expire at
the annual meeting of shareholders noted below.
--------------------------------------------------------------------------------
Term Expires at 2002 Term Expires at 2003 Term Expires at 2004
Annual Meeting Annual Meeting Annual Meeting
--------------------------------------------------------------------------------
William R. Gutow John W. Ballen Lawrence H. Cohn
--------------------------------------------------------------------------------
J. Atwood Ives William J. Poorvu Sir J. David Gibbons
--------------------------------------------------------------------------------
Abby M. O'Neill J. Dale Sherratt Lawrence T. Perera
--------------------------------------------------------------------------------
Jeffrey L. Shames Ward Smith Arnold D. Scott
--------------------------------------------------------------------------------
Charles W. Schmidt* Elaine R. Smith
--------------------------------------------------------------------------------
David B. Stone*
--------------------------------------------------------------------------------
*As noted above, these Trustees are retiring as of December 31, 2001.
If, before the election, any nominee refuses or is unable to serve, proxies will
be voted for a replacement nominee designated by your current Trustees. You are
being asked to elect all of the nominees listed in the table below and to
re-elect your current Trustees. Aside from those Trustees who are retiring at
the end of the year and Messrs. Ives and Perera (whose terms expire at this
annual meeting of shareholders), your current Trustees will continue to serve as
Trustees of your Fund even if shareholders do not approve Item 1.
The following table presents certain information regarding the Trustees (other
than Messrs. Schmidt and Stone, who will be retiring) and nominees for Trustee,
including their principal occupations, which, unless specific dates are shown,
are of more than five years duration, although the titles may not have been the
same throughout.
NAME, POSITION WITH THE FUND, AGE
PRINCIPAL OCCUPATION AND OTHER DIRECTORSHIPS(1)
JEFFREY L. SHAMES* (born 6/2/55) Trustee, Chairman and President
Massachusetts Financial Services Company, Chairman and Chief Executive
Officer.
JOHN W. BALLEN* (born 9/12/59) Trustee Massachusetts Financial Services
Company, President and Director.
LAWRENCE H. COHN, M.D. (born 3/11/37) Nominee for Trustee Brigham and
Women's Hospital, Chief of Cardiac Surgery; Harvard Medical School,
Professor of Surgery.
THE HON. SIR J. DAVID GIBBONS, KBE (born 6/15/27) Nominee for Trustee
Edmund Gibbons Limited (diversified holding company), Chief Executive
Officer; Colonial Insurance Company Ltd., Director and Chairman; Bank
of Butterfield, Chairman (until 1997).
WILLIAM R. GUTOW (born 9/27/41) Trustee
Private investor and real estate consultant; Capitol Entertainment
Management Company (video franchise), Vice Chairman.
J. ATWOOD IVES (born 5/1/36) Trustee
Private investor; Eastern Enterprises (diversified services company),
Chairman, Trustee and Chief Executive Officer (until November 2000);
KeySpan Corporation (energy related services), Director.
ABBY M. O'NEILL (born 4/27/28) Nominee for Trustee
Private investor; Rockefeller Financial Services, Inc. (investment
advisers), Chairman and Chief Executive Officer.
LAWRENCE T. PERERA (born 6/23/35) Trustee
Hemenway & Barnes (attorneys), Partner.
WILLIAM J. POORVU (born 4/10/35) Trustee
Harvard University Graduate School of Business Administration, Adjunct
Professor; CBL & Associates Properties, Inc. (real estate investment
trust), Director; The Baupost Fund (a mutual fund), Vice Chairman and
Trustee.
ARNOLD D. SCOTT* (born 12/16/42) Trustee
Massachusetts Financial Services Company, Senior Executive Vice
President and Director.
J. DALE SHERRATT (born 9/23/38) Nominee for Trustee
Insight Resources, Inc. (acquisition planning specialists), President;
Wellfleet Investments (investor in health care companies), Managing
General Partner (since 1993); Cambridge Nutraceuticals (professional
nutritional products), Chief Executive Officer (until May 2001);
Paragon Trade Brands, Inc. (disposable consumer products), Director.
ELAINE R. SMITH (born 4/25/46) Trustee
Independent consultant.
WARD SMITH (born 9/13/30) Nominee for Trustee
Private investor
-----------------------
(1) Directorships or trusteeships of companies required to report to the
Securities and Exchange Commission (i.e., "public companies").
* "Interested person" of MFS within the meaning of the Investment Company Act
of 1940 (referred to as the 1940 Act), which is the principal federal law
governing investment companies like your Fund. The address of MFS is 500
Boylston Street, Boston, Massachusetts.
Each Trustee holds comparable positions with certain affiliates of MFS or with
certain other funds of which MFS or a subsidiary is the investment adviser or
distributor. Messrs. Ballen, Ives, Perera, and Poorvu and Ms. Smith serve as
board members of 45 funds within the MFS Family of Funds. Messrs. Cohn, Gibbons,
Sherratt and Smith and Ms. O'Neill serve as board members of 42 funds within the
MFS Family of Funds. Mr. Gutow serves as board member of 73 funds within the MFS
Family of Funds. Messrs Scott and Shames serve as board members of 115 funds
within the MFS Family of Funds.
Information about Trustee compensation, Trustee retirement plan arrangements and
the executive officers of your Fund appears under "Fund Information" on page
___.
Your current Board of Trustees meets regularly throughout the year to discuss
matters relating to your Fund. The Board has a standing Audit Committee,
currently composed of Ms. Smith and Messrs. Perera, Poorvu, and Stone, to review
the internal and external accounting and auditing procedures of your Fund and,
among other things, to consider the selection of independent public accountants
for your Fund, to approve all significant services proposed to be performed by
those accountants and to consider the possible effect of the services on the
independence of those accountants. The Audit Committee consists only of Trustees
who are not "interested persons" of your Fund as defined in the 1940 Act and who
are independent of the Fund as defined by New York Stock Exchange Listing
Standards. The Fund's Audit Committee Charter appears in Appendix A to this
proxy statement. The Audit Committee's report on the Fund's most recent audited
financials is included in Item 5 below.
The Board has also created a Nominating Committee, composed solely of all of the
current Trustees who are not "interested persons" of the Fund as defined in the
1940 Act, that is responsible for recommending qualified candidates to the Board
in the event that a position is vacated or created. The Nominating Committee
would consider recommendations by shareholders if a vacancy were to exist.
Shareholders wishing to recommend Trustee candidates for consideration by the
Nominating Committee may do so by writing the Fund's Secretary. Members of the
Nominating Committee confer periodically and hold meetings as required.
Information about Board and Committee meetings held by the Fund appears under
"Fund Information" on page ____. Each Trustee attended at least 75% of the Board
and applicable Committee meetings noted.
The Fund's declaration of trust currently provides that the Fund will indemnify
its Trustees and officers against liabilities and expenses incurred in
connection with litigation in which they may be involved because of their
offices with the Fund, unless it is finally adjudicated or, in case of a
settlement, it has been determined by Trustees not involved in the matter or
independent legal counsel, that they have not acted in good faith in the
reasonable belief that their actions were in the best interests of the Fund or
that they engaged in willful misfeasance or acted with bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his or
her office.
REQUIRED VOTE
Approval of this proposal as to any nominee will require the affirmative vote of
a plurality of the outstanding shares of your Fund voting at the Meeting in
person or by proxy.
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF
EACH NOMINEE AS A TRUSTEE.
ITEM 2 -- TO AUTHORIZE THE TRUSTEES TO ADOPT AN AMENDED AND RESTATED DECLARATION
OF TRUST.
The Fund is organized as a Massachusetts business trust. Under Massachusetts
law, a business trust usually operates under a charter or organizational
document, called a declaration of trust, that contains various provisions
relating primarily to how the trust conducts business and how the trust is
governed. The Fund operates under a declaration of trust.
At the Meeting, you will be asked to authorize your Trustees to adopt for your
Fund the Amended and Restated Declaration of Trust appearing in Appendix B to
this proxy statement (called, in this proxy statement, the Restated
Declaration). The Restated Declaration amends and restates the existing
declaration of trust of the Fund (called, in this proxy statement, the Existing
Declaration) in its entirety. The Trustees have approved the Restated
Declaration and recommend that you authorize the Trustees to adopt it. The
Restated Declaration is the standard form that will be used for all MFS
closed-end funds organized as Massachusetts business trusts in the future.
The Restated Declaration gives the Trustees more flexibility and, subject to
applicable requirements of the 1940 Act and Massachusetts law, broader authority
to act. This increased flexibility may allow the Trustees to react more quickly
to changes in competitive and regulatory conditions and, as a consequence, may
allow the Fund to operate in a more efficient and economical manner. Adoption of
the Restated Declaration will not alter in any way the Trustees' existing
fiduciary obligations to act with due care and in the shareholders' interests.
You should note that your Fund's investments and investment policies will not
change by virtue of the adoption of the Restated Declaration. However, certain
of your Fund's investment policies will be affected by other items in this proxy
statement.
The Restated Declaration makes a number of significant changes to the Existing
Declaration. Certain of these changes give the Trustees greater flexibility and
broader authority to act without shareholder approval. The most significant
changes are summarized below. In addition to the changes described below, there
are other substantive and stylistic differences between the Restated Declaration
and the Existing Declaration. The following summary is qualified in its entirety
by reference to the Restated Declaration itself in Appendix B. The attached
Restated Declaration has been marked to show changes from the Existing
Declaration.
SIGNIFICANT CHANGES
1. REORGANIZATION. The Restated Declaration permits the Trustees, without
shareholder approval, to change the Fund's form of organization, reorganize all
or a portion of the Fund into a newly created entity or a newly created series
of an existing entity, or incorporate all or a portion of the Fund as a newly
created entity. The Existing Declaration requires shareholder approval for this
type of reorganization.
Under certain circumstances, it may not be in the shareholders' interests to
require a shareholder meeting to permit all or a portion of the Fund to
reorganize into another entity or to incorporate. For example, in order to
reduce the cost and scope of state regulatory requirements or to take advantage
of a more favorable tax treatment offered by another state, the Trustees may
determine that it would be in the shareholders' interests to reorganize the Fund
to domicile it in another state or to change its legal form. Under the Existing
Declaration, the Trustees cannot effectuate such a potentially beneficial
reorganization without first conducting a shareholder meeting and incurring the
attendant costs and delays. The Restated Declaration gives the Trustees the
flexibility to reorganize all or a portion of the Fund and achieve potential
shareholder benefits without incurring the delay and potential costs of a proxy
solicitation. This flexibility should help to assure that the Fund operates
under the most appropriate form of organization.
The Restated Declaration requires that shareholders receive written notification
of any reorganization transaction.
The Restated Declaration does not permit the Fund to merge with or sell its
assets to another operating entity without first obtaining shareholder approval.
2. FUTURE AMENDMENTS. The Restated Declaration may be amended without
shareholder approval in most cases. The Existing Declaration may be amended
without shareholder approval only in certain limited circumstances. Under the
Restated Declaration, shareholders generally retain the right to vote on any
amendment affecting their voting powers, on any amendment affecting the
amendment provisions of the Restated Declaration, on any amendment required by
law or by the applicable Fund's registration statement to be approved by
shareholders, and on any amendment submitted to shareholders by the Trustees. By
allowing amendment of the Restated Declaration without shareholder approval
(except as noted above), the Restated Declaration gives the Trustees the
necessary authority to react quickly to future contingencies.
The Restated Declaration also permits the Trustees to adopt By-Laws concerning
the conduct of business of the Fund and to amend or repeal the By-Laws at any
time so long as the By-Laws are not inconsistent with the Restated Declaration.
3. INVESTMENT IN OTHER INVESTMENT COMPANIES. The Restated Declaration permits
the Fund to invest in other investment companies to the extent not prohibited by
the 1940 Act, and rules and regulations thereunder. Recent amendments to the
1940 Act permit investment companies to invest their assets in one or more
registered investment companies so long as certain conditions are met. It is
possible that there could be additional amendments to the 1940 Act in the future
which affect investment companies' ability to invest in other funds. An
investment structure where a fund invests all of its assets in a single
investment company is sometimes referred to as a "master/feeder" structure. An
investment structure where a fund invests its assets in more than one investment
company is sometimes referred to as a "fund of funds" structure. Both the
master/feeder and fund of funds structure attempt to achieve economies of scale
and efficiencies in portfolio management by consolidating portfolio management
with other investment companies, while permitting a fund to retain its own
characteristics and identity.
The Restated Declaration will permit the Fund to take advantage of the recent
changes in law, as well as any future changes in law or regulation on this
topic. Under the Restated Declaration, the Trustees have the power to implement
a master/feeder, fund of funds or other similar structure without seeking
shareholder approval. If the Fund invests in other investment companies, the
Fund will indirectly bear expenses, such as management fees, of those other
investment companies, in addition to the Fund's own expenses. While the Trustees
have no current intention of implementing a master/feeder, fund of funds or
other similar structure at this time, the Trustees believe circumstances could
arise in which it would be in the best interest of the Fund to do so at a future
date. Shareholders of the Fund would be notified if the Trustees decide to
implement such a structure for the Fund, and the Fund will not implement such a
structure unless its investment restrictions permit it to do so. Item 3 below
also seeks approval of changes to the Fund's investment restrictions that would
permit the use of these structures.
4. TERMINATION OF THE FUND. The Restated Declaration permits the Trustees,
without shareholder approval, to terminate the Fund. The Existing Declaration
permits the Trustees to terminate the Fund only with shareholder approval. The
Board of Trustees may determine that it is in the shareholders' best interests
to terminate the Fund, for example, because the Fund is not big enough to
operate on an economical basis. Shareholders of the Fund would be notified if
the Trustees decide to terminate the Fund.
OTHER CHANGES
The Restated Declaration also changes the Existing Declaration as follows:
1. The Restated Declaration permits the Fund to enter into and amend advisory
and subadvisory agreements without shareholder approval if permitted by
applicable law.
2. The Restated Declaration explicitly allows the Trustees, with shareholder
approval, to effect mergers, reorganizations and similar transactions
through a variety of methods, including share-for-share exchanges,
transfers or sales of assets, and exchange offers.
3. The Restated Declaration provides for (i) the removal of any Trustee with
or without cause at any time by the affirmative vote of two-thirds of the
outstanding shares of the trust or by the vote of three-quarters of the
Trustees, and (ii) the automatic retirement of Trustees in accordance with
any retirement policy set by the Trustees. The Restated Declaration does
not require the Trustees to provide notice to shareholders of the
appointment of a new Trustee.
4. The Restated Declaration no longer requires that the number of Trustees be
fixed in writing or that Trustees be appointed in writing, but permits
these actions to be taken at Board meetings. The Restated Declaration also
provides that the Trustees may act by a two-thirds majority (rather than
unanimous) written consent. The Restated Declaration permits electronic
delivery to shareholders of notices and other information, and simplifies
the information delivery requirements for shareholders in the same
household. These provisions are intended to simplify administration of the
Fund's affairs.
5. The Restated Declaration confirms and clarifies various existing Trustee
powers. For example, the Restated Declaration clarifies that, among other
things, the Trustees may delegate authority to investment advisers and
other agents, purchase insurance insuring Fund assets, employees, Trustees
and Trustees Emeritus, and invest Fund assets in all types of investments
including derivatives. The Restated Declaration also provides that the
Trustees may, but are not obligated to, employ a custodian for the
safekeeping of Fund assets.
6. The Restated Declaration provides that by becoming a shareholder of the
Fund each shareholder shall be held expressly to have assented to and
agreed to be bound by the provisions of the Restated Declaration.
7. The Restated Declaration provides that except when a larger vote is
required by applicable law or by any provision of the Declaration, the
By-Laws, a majority of the shares voted in person or by proxy on a matter
will decide that matter and a plurality will elect a Trustee. A similar
provision is contained in the Fund's By-Laws.
8. The Restated Declaration provides that rights to indemnification or
insurance cannot be limited retroactively.
9. The Restated Declaration provides that shareholders may not bring suit on
behalf of the Fund without first requesting that the Trustees bring such
suit unless there would be irreparable injury to the Fund or if a majority
of the Trustees has personal financial interest in the action. Trustees are
not considered to have a personal financial interest by virtue of being
compensated for their services as Trustees or as trustees of funds with the
same or an affiliated investment adviser or distributor. The effect of this
provision may be to discourage suits brought against the Fund by its
shareholders. A similar provision currently appears in the Fund's By-Laws.
10. The Restated Declaration provides that actions taken by the Trustees and
officers in good faith and with reasonable care are binding on all
concerned.
ADDITIONAL INFORMATION
Like the Existing Declaration, the Restated Declaration has certain provisions
which could have the effect of limiting the ability of other entities or persons
to acquire control of the Fund, to cause it to merge with or sell its assets to
another operating entity, to terminate the Fund, or to modify its structure. In
addition, the Restated Declaration, like the Existing Declaration, requires the
affirmative vote or consent of the holders of 66 and 2/3% of the Fund's shares
(a greater vote than that required by the 1940 Act) to authorize the conversion
of the Fund from a closed-end to an open-end investment company. The foregoing
provisions will make more difficult a change in the Fund's management without
the Trustees' approval, and could have the effect of depriving shareholders of
an opportunity to sell their shares at a premium over prevailing market prices
by discouraging a third party from seeking to obtain control of the Fund in a
tender offer or similar transaction. However, the Board of Trustees has
considered these provisions and believes that they are in the shareholders' best
interests and benefit shareholders by providing the advantage of potentially
requiring persons seeking control of the Fund to negotiate with its management
regarding the price to be paid and facilitating the continuity of the Fund's
management.
REQUIRED VOTE
Approval of the Restated Declaration requires the affirmative vote of 66 and
2/3% of the shares of the Fund outstanding and entitled to vote.
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR AUTHORIZING THE
TRUSTEES TO ADOPT THE AMENDED AND RESTATED DECLARATION OF TRUST.
ITEM 3 -- TO AMEND OR REMOVE CERTAIN FUNDAMENTAL INVESTMENT POLICIES OF THE
FUND.
The Fund has adopted certain investment restrictions or policies that are
"fundamental," meaning that as a matter of law they cannot be changed without
shareholder approval. The Fund's fundamental policies reflect certain
regulatory, business or industry conditions at the time they were adopted.
Changes in applicable law now permit investment companies like the Fund to
revise or eliminate certain of these policies.
The Fund's Board of Trustees, together with the Fund's officers and MFS, have
reviewed the Fund's current fundamental policies, and have concluded that
certain policies should be eliminated or revised based on the development of new
practices and changes in applicable law and to facilitate administration of the
Fund. The proposed revised policies for the Fund are listed in Appendix C. At
the Meeting, shareholders will be asked to approve the revised policies and to
eliminate all other fundamental policies.
The revised policies maintain important investor protections while providing
flexibility to respond to changing markets, new investment opportunities and
future changes in applicable law. In some cases, only technical changes are
being made. The Trustees believe that implementing the revised policies will
facilitate MFS's management of the Fund's assets and simplify the process of
monitoring compliance with investment policies. The revised policies (with
variations required by the specific investment focus of a fund) will be the
standard form for funds in the MFS fund complex.
THE REVISED POLICIES DO NOT AFFECT THE INVESTMENT OBJECTIVES OF THE FUND, WHICH
REMAIN UNCHANGED. THE FUND WILL CONTINUE TO BE MANAGED IN ACCORDANCE WITH THE
INVESTMENT POLICIES DESCRIBED IN THE PROSPECTUS AND IN ACCORDANCE WITH FEDERAL
LAW. THE REVISED POLICIES WOULD GIVE THE FUND INCREASED ABILITY TO ENGAGE IN
CERTAIN ACTIVITIES. THE TRUSTEES MAY CONSIDER AND ADOPT SUCH NON-FUNDAMENTAL
INVESTMENT POLICIES FOR THE FUND AS THEY DETERMINE TO BE APPROPRIATE AND IN THE
SHAREHOLDERS' BEST INTERESTS. THE TRUSTEES DO NOT ANTICIPATE THAT THE REVISED
POLICIES, INDIVIDUALLY OR IN THE AGGREGATE, WILL CHANGE TO A MATERIAL DEGREE THE
LEVEL OF INVESTMENT RISK ASSOCIATED WITH AN INVESTMENT IN THE FUND.
Each investment policy proposed to be revised, eliminated or added is discussed
below. Appendix C lists the fundamental policies that will apply to the Fund if
shareholders of the Fund approve this proposal. Appendix D lists the Fund's
current fundamental investment policies and the proposed action to be taken with
respect to each policy.
A. Borrowing
It is proposed that the policy concerning borrowing be changed so that the Fund
may borrow money to the fullest extent permitted by applicable law.
Currently, the Fund may borrow up to one-third of its assets or may pledge,
mortgage or hypothecate its assets as a temporary measure for extraordinary or
emergency purposes, for a repurchase of its shares, or for investment in
accordance with its investment objective and policies.
The 1940 Act, which is the federal law that governs investment companies like
the Fund, does not require that borrowings be made only for limited purposes,
nor does the 1940 Act require any limit on assets pledged to secure borrowings.
It is possible that the Fund's existing policies could prevent it from borrowing
when it is in the best interests of shareholders to do so. The revised policy
will give the Fund the maximum amount of flexibility to borrow permitted by
applicable law. Currently, the 1940 Act permits investment companies like the
Fund to borrow money so long as there is 300% asset coverage of the borrowings
at the time of the loan. This means that at the time of the loan borrowings
cannot exceed one-third of an investment company's total assets after
subtracting liabilities other than the borrowings. While the statutory test
currently is similar to the Fund's existing policy, the revised policy would
allow the Fund to take advantage of any future changes in the statutory test.
Investment companies like the Fund generally borrow money to try to enhance
returns to shareholders (this is referred to as leverage). Borrowing money
creates risks and expenses for the Fund and may make the Fund's net asset value
more volatile. The interest and other costs of borrowing may reduce the Fund's
return. The Fund also could be forced to sell securities at inopportune times to
repay loans.
B. Underwriting Securities
It is proposed that the policy concerning underwriting securities be changed so
that the Fund may not underwrite securities issued by other persons, except that
all or any portion of the assets of the Fund may be invested in one or more
investment companies, to the extent not prohibited by the 1940 Act and exemptive
orders granted under such Act, and except insofar as the Fund may technically be
deemed an underwriter under the Securities Act of 1933, as amended, in selling a
portfolio security. The revised policy also provides that the Fund is not deemed
to underwrite securities by virtue of employing a master/feeder or fund-of-funds
investment structure as permitted by applicable law. Utilizing these investment
structures is discussed in Item 2 of this proxy statement (under "Significant
Changes -- 3. Investment in Other Investment Companies").
Currently, the Fund is prohibited from underwriting securities issued by others
except to the extent the Fund may be deemed to be an underwriter, under the
federal securities laws, when it sells portfolio securities.
C. Issuance of Senior Securities
It is proposed that the policy concerning the issuance of senior securities be
changed so that the Fund may issue senior securities to the fullest extent
permitted by applicable law. For purposes of this restriction, collateral
arrangements with respect to swaps, options, futures, forwards and initial and
variation margin are not deemed to be the issuance of a senior security.
Currently, the Fund is subject to a fundamental policy that provides that it may
not issue any senior securities except as permitted by the 1940 Act. Certain
technical changes are being made to this policy to clarify the circumstances in
which the Fund may issue senior securities, including pursuant to any exemptive
relief under the 1940 Act. In addition, the revised policy clarifies and expands
the types of collateral arrangements that are excluded from the restriction to
include swaps and forward contracts.
D. Lending of Money or Securities
It is proposed that the policy concerning lending money be changed so that the
Fund may make loans to the fullest extent permitted by applicable law.
Currently, the Fund is prohibited from lending money. The Fund may lend its
securities, but not in excess of 30% of its total assets (taken at market
value). Investments in commercial paper, debt securities and repurchase
agreements are not treated as loans for purposes of these policies. The revised
policy will permit the Fund to make loans, whether of money or securities, so
long as the transactions are permitted by applicable law.
Lending securities may be a source of income to the Fund and is permitted under
the 1940 Act, subject to certain limitations. As with other extensions of credit
there are risks of delay in recovery or even loss of rights in the underlying
securities should the borrower of the securities fail financially. However,
loans would be made in accordance with procedures approved by the Trustees only
to firms deemed by MFS to be of good standing, and when, in the judgment of MFS,
the income from securities loans justifies the attendant risk.
It is unlikely that the Fund would lend money, except to the extent that the
purchase of debt securities can be considered a loan; however, the Fund could
lend money to other funds advised by MFS or one of its affiliates. The Fund
would have to obtain exemptive relief from the Securities and Exchange
Commission (referred to as the SEC) to make loans to other MFS-advised funds.
E. Real Estate, Oil and Gas, Mineral Interests, and Commodities
It is proposed that the policy concerning real estate, oil, gas and mineral
interests, and commodities be changed so that the Fund may not purchase or sell
real estate, interests in oil, gas or mineral leases, commodities or commodity
contracts in the ordinary course of its business. Under this policy, the Fund
will be able to invest in securities secured by real estate and securities of
companies that deal in real estate, as well as options and futures and forward
contracts, and the Fund also will retain the right to hold and sell real estate,
mineral leases, commodities or commodity contracts acquired as a result of the
ownership of securities.
The revised policy clarifies that the restrictions relating to investments in
real estate and commodities do not apply to investments in currencies, any type
of option contract, futures contracts, forward contracts, and securities of
companies, such as real estate investment trusts, which deal in real estate or
interests therein.
F. Industry Concentration
It is proposed that the policy concerning concentration in a particular industry
be changed so that the Fund may not purchase securities of an issuer of a
particular industry if as a result 25% or more of the Fund's total assets (taken
at market value at the time of purchase) would be invested in securities of
issuers whose principal business activities are in the same industry, except
that the Fund may invest up to 40% of the value of its assets in each of the
electric utility and telephone industries.
This revised policy is similar to the Fund's existing concentration policy,
except that the revised policy clarifies that the calculation of concentration
is made with respect to the Fund's total assets taken at market value at the
time of purchase of the security in question. The revised policy also removes
the restriction that the Fund may not invest more than 25% of its total assets
in either of the electric utility and telephone industries unless yields
available for four consecutive weeks in the four highest rating categories on
new issue bonds in such industry (issue size of $50 million or more) have
averaged in excess of 105% of yields of new issue longer term industrial bonds
similarly rated (issue size of $50 million or more). If the Fund concentrates in
the electric utility and telephone industries, its investment performance would
be closely tied to the performance of companies in these industries. Companies
in a single industry often are faced with the same obstacles, issues and
regulatory burdens, and their securities may react similarly and more in unison
to these or other market conditions. Accordingly, the Fund could be riskier than
funds with more broadly diversified portfolios.
G. Purchasing Securities on Margin - Removal of Policy
The Fund has a fundamental policy that prevents the Fund from purchasing any
security on margin. Margin transactions generally involve the purchase of
securities with money borrowed from a broker, with cash or securities being used
as collateral for the loan. MFS has recommended the elimination of this policy
on margin transactions to provide the Fund with the maximum amount of
flexibility permitted by applicable law, and any future changes in law, on this
topic. Accordingly, it is proposed that this policy be deleted in its entirety.
H. Short Sales - Removal of Policy
Currently, the Fund is prohibited from making short sales of securities, except
that the Fund may make short sales "against the box" (short sales where the Fund
owns or has the right to acquire at no added cost securities identical to those
sold short) subject to the limitation that not more than 10% of the Fund's net
assets (taken at market value) is held as collateral for such sales at any one
time. The 1940 Act prohibits investment companies from making short sales of
securities except in accordance with SEC rules and regulations. The SEC has not
adopted any rules or regulations relating to short sales, except that the staff
of the SEC regards a short sale as a form of leverage and has taken positions
with respect to the use of leveraging transactions. Accordingly, the Fund's
investment policy is more restrictive than applicable law. The Fund is proposing
to delete this policy in its entirety in order to have the maximum amount of
flexibility permitted by applicable law, and any future changes in law, on this
topic.
In a typical short sale the Fund borrows securities from a broker that it
anticipates will decline in value in order to sell to a third party. The Fund
becomes obligated to return securities of the same issue and quantity at some
future date, and it realizes a profit or loss depending upon whether the market
price of the security decreases or increases between the date of the short sale
and the date on which the Fund must replace the borrowed security. Because the
value of a particular security can increase without limit, the Fund could
potentially realize losses with respect to short sales that are not "against the
box" that could be significantly greater than the value of the securities at the
time they are sold short, and such losses could also be unlimited.
I. Investments in a Single Issuer - Removal of Policy
Currently, the Fund is prohibited from purchasing the securities of any issuer
if, as a result, the Fund would hold more than 10% of the voting securities of
the issuer.
Although the Fund is non-diversified, the Fund must meet certain diversification
requirements under the Internal Revenue Code in order to qualify for beneficial
tax treatment as a regulated investment company. These diversification
requirements provide in part that as to 50% of the fund's assets, investments in
any one issuer cannot exceed 5% of the fund's assets and the fund cannot hold
more than 10% of the issuer's outstanding voting securities at the end of each
quarter. The Fund intends to qualify as a regulated investment company for tax
purposes.
The Fund's current diversification policies are more restrictive than required
for the Fund to qualify as a regulated investment company. The Trustees believe
that it is unnecessary to have fundamental policies that are more restrictive
than what the Internal Revenue Code requires. Accordingly, the Fund proposes to
delete this investment policy.
To the extent that the Fund invests its assets in a small number of issuers, the
Fund is more susceptible to any single economic, political or regulatory event
affecting those issuers.
REQUIRED VOTE
Approval of this Item will require the affirmative vote of the holders of a
"majority of the outstanding voting securities" of the Fund.
THE BOARD OF TRUSTEES HAS CONCLUDED THAT THE PROPOSAL TO AMEND OR REMOVE THE
FUNDAMENTAL INVESTMENT POLICIES OF THE FUND WILL BENEFIT THE FUND AND ITS
SHAREHOLDERS. THE TRUSTEES UNANIMOUSLY RECOMMEND VOTING FOR THE PROPOSAL.
ITEM 4 -- TO APPROVE A NEW INVESTMENT ADVISORY AGREEMENT WITH MASSACHUSETTS
FINANCIAL SERVICES COMPANY.
At the meeting, you will be asked to approve a new Investment Advisory Agreement
between your Fund and MFS. The investment management fee payable by your Fund
will not increase or decrease if shareholders of your Fund approve the new
Investment Advisory Agreement.
Currently, each fund in the MFS Family of Funds, including your Fund, has a
separate Investment Advisory Agreement with MFS. These Investment Advisory
Agreements were entered into at various times over the past several decades, and
their provisions differ. MFS has recommended that the provisions of all of the
Investment Advisory Agreements be standardized and modernized. MFS believes that
the standardization and modernization of the Investment Advisory Agreements will
simplify the administration of the Fund and other funds in the MFS Family of
Funds.
The discussion below describes the principal differences between the current and
proposed Investment Advisory Agreement (referred to as the Current Agreement and
the New Agreement) and provides additional information about MFS and about the
Board's review of the New Agreement. The New Agreement will be the standard form
for all U.S. registered funds in the MFS fund complex.
The information provided herein is intended to be a summary of the material
changes between the Current Agreement and the New Agreement. This summary is
qualified in its entirety by reference to the comparison of the Current
Agreement and the New Agreement in Appendix E. In particular, please refer to
Appendix E for additional information about other technical changes that were
made to the New Agreement.
A. Current Agreement
MFS has served as the investment adviser for the Fund since the commencement of
the Fund's operations. The Current Agreement, dated February 25, 1987, was last
approved by the Fund's sole shareholder on that date in connection with the
Fund's commencement of operations.
Under the Current Agreement, MFS provides the Fund with overall investment
advisory services. Subject to such policies as the Trustees may determine, MFS
makes investment decisions for the Fund. For these services and facilities, MFS
receives an annual management fee, computed and paid monthly in an amount equal
to the sum of 0.34% of the average daily net assets of the Fund and 5.4% of the
daily gross income (i.e., income other than gains from the sale of securities,
short-term gains from options and futures transactions and premium income from
options written). For the fiscal year ended October 31, 2000, MFS received
$5,141,826 from the Fund as compensation under the Current Agreement.
MFS pays the compensation of the Fund's officers and of any Trustee who is an
officer of MFS. MFS also furnishes at its own expense all necessary
administrative services, including office space, equipment, clerical personnel,
investment advisory facilities and all executive and supervisory personnel
necessary for managing the Fund's investments and effecting its portfolio
transactions. The Fund pays the compensation of its Trustees who are not
officers of MFS and all expenses of the Fund (other than those assumed by MFS).
More detailed information about the expenses paid by the Fund is discussed under
"Changes Proposed in the New Agreement" below.
B. Changes Proposed in the New Agreement
1. Advice regarding Other Instruments
The Current Agreement provides that MFS will continuously furnish an investment
program for the Fund and determine from time to time what securities will be
purchased, sold or exchanged and what portion of the assets of the Fund will be
held uninvested. The New Agreement provides that MFS will determine what
securities or other instruments will be purchased, sold or exchanged for the
Fund. The change clarifies that MFS may provide advice as to certain
investments, such as some derivative contracts, that may not be considered
securities. Certain other references to "securities" have been changed to
"securities or other instruments" throughout the New Agreement. This change is
not intended to change the type of investments in which the Fund may invest. The
Fund's investments are governed by its registration statement.
2. Proxy Voting
The New Agreement clarifies that MFS will exercise voting rights, rights to
consent to corporate actions and any other rights pertaining to the Fund's
portfolio securities in accordance with policies and procedures that MFS
presents to the Trustees from time to time. The Current Agreement provides that
MFS may make recommendations as to the manner in which rights relating to
portfolio securities are exercised. This provision in the New Agreement more
closely reflects MFS's current practice with respect to the exercise of rights
pertaining to the Fund's portfolio securities.
3. Brokerage Transactions
The Current Agreement provides that in connection with the selection of brokers
and dealers and the placing of orders, MFS is directed to seek for the Fund
execution of transactions at the best available price.
The New Agreement provides that, in connection with the selection of brokers or
dealers and the placing of orders, MFS is directed to seek for the Fund the best
overall price and execution available from responsible brokerage firms, taking
into account all factors it deems relevant, including by way of illustration:
price, the size of the transaction; the nature of the market for the security;
the amount of the commission; the timing and impact of the transaction taking
into account market prices and trends; the reputation, experience and financial
stability of the broker or dealer involved; and the quality of services rendered
by the broker or dealer in other transactions. This provision clarifies that MFS
may consider factors other than just price when seeking to obtain best execution
for the Fund's transactions. Under the policies of the SEC, MFS considers the
full range and quality of a broker's services in placing brokerage orders in
order to fulfill its duty to obtain best execution for the Fund's transactions.
The New Agreement provides that MFS may cause the Fund to pay a broker or dealer
a higher commission than another broker or dealer might have charged for
effecting that transaction, if MFS determines, in good faith, that the higher
commission was reasonable in relation to the value of brokerage and research
services provided by the broker or dealer. The value of these brokerage and
research services may be viewed in terms of either the Fund's particular
transactions or MFS's overall responsibilities with respect to the Fund and
MFS's other clients. The Fund's Current Agreement provides that subject to the
requirement of seeking the best available price, securities may be bought from
or sold to broker dealers who have furnished statistical, research and other
information or services to MFS.
The New Agreement also provides that, subject to seeking the best price and
execution as described above, and in accordance with applicable rules and
regulations, MFS may consider sales of shares of the Fund or of other MFS funds
or accounts as a factor in the selection of brokers and dealers.
The additional provisions in the New Agreement are not intended to change the
current practice of MFS as to its consideration of brokerage and research
services and sales of Fund shares in the selection of brokers and dealers.
4. Expenses
The Current Agreement provides that the Fund will pay all of its own expenses.
The Current Agreement contains a list of typical Fund expenses. This list of
expenses has been amended to include expenses of soliciting proxies;
organizational and start up costs; and such non-recurring or extraordinary
expenses as may arise, including those relating to actions, suits or proceedings
to which the Fund is a party or otherwise may have an exposure and the legal
obligation which the Fund may have to indemnify the Trustees and officers with
respect thereto. This amendment is being proposed in order to provide a
standardized list of Fund expenses within the MFS Family of Funds.
The New Agreement provides that if MFS pays or assumes any expenses of the Fund,
MFS is not obligated by the New Agreement to pay or assume the same or similar
expenses of the Fund on any subsequent occasion.
These amendments are designed to clarify the types of expenses which the Fund
may bear.
5. Certain Recordkeeping Services by MFS
The New Agreement adds a provision that MFS must maintain certain records in a
form acceptable to the Fund and in compliance with the rules and regulations of
the SEC. MFS currently maintains such records, even without the express
obligation to do so.
6. Sub-Advisory Agreements
The New Agreement provides that the Adviser may from time to time enter into
investment sub-advisory agreements with respect to the Fund with one or more
investment advisers with such terms and conditions as MFS may determine,
provided that such investment sub-advisory agreements have been approved in
accordance with the provisions of applicable law. Under applicable law, any new
investment sub-advisory agreement generally must be submitted to shareholders
for approval, subject to limited exceptions. It is not currently intended that
MFS enter into an investment sub-advisory agreement with respect to the Fund,
but MFS has in the past engaged investment sub-advisers with respect to other
MFS funds and may seek to engage sub-advisers for the Fund in the future.
7. Other Agreements with MFS
The New Agreement adds a provision that the Fund may enter into such other
agreements covering the provision of administrative and other additional
services to the Fund as the Trustees may deem appropriate, and that such an
agreement will not expand, reduce or otherwise alter the services which MFS is
required to provide, or the compensation which MFS is due, under the Agreement.
These other agreements may be with MFS, an affiliate of MFS or a third party.
These amendments are not intended to change the services MFS is required to
provide, or change the fees paid to MFS.
8. Other Clients of MFS
The Current Agreement for the Fund provides that the services of MFS to the Fund
are not exclusive, and that MFS is free to render investment and/or other
services to others. The New Agreement adds an express acknowledgment by the Fund
that it is possible that certain funds or accounts managed by MFS or its
affiliates may at times take investment positions or engage in investment
techniques which are contrary to positions taken or techniques engaged in on
behalf of the Fund, but that MFS will at all times endeavor to treat all of its
clients in a fair and equitable manner.
Under the New Agreement, the Fund acknowledges that whenever the Fund and one or
more other funds or accounts advised by MFS have money available for investment,
investments suitable for each will be allocated in a manner believed by MFS to
be fair and equitable to each entity. Similarly, opportunities to sell
investments will be allocated in a manner believed by MFS to be fair and
equitable to each client. In some instances, this may adversely affect the size
of the position that may be acquired or disposed of for the Fund.
9. Other Provisions
The New Agreement adds certain other technical, legal provisions which are
standard for investment advisory contracts in the investment company industry,
including provisions concerning the Fund's ability to use the acronym "MFS" and
related trade or service marks in its name.
C. Information about MFS and its Affiliates
MFS is a Delaware corporation with offices at 500 Boylston Street, Boston,
Massachusetts 02116. MFS is an 81.8%-owned subsidiary of Sun Life of Canada
(U.S.) Financial Services Holdings, Inc., 500 Boylston Street, Boston
Massachusetts 02116, which is in turn a wholly-owned subsidiary of Sun Life
Assurance Company of Canada - U.S. Operations Holdings, Inc., One SunLife
Executive Park, Wellesley Hills, Massachusetts 02481. Sun Life Assurance Company
of Canada - U.S. Operations Holdings, Inc. is a wholly-owned subsidiary of Sun
Life Assurance Company of Canada, 150 King Street West, 14th Floor, Toronto,
Canada M5H1J9, which in turn is a wholly-owned subsidiary of Sun Life Financial
Services of Canada, Inc., 150 King Street West, 14th Floor, Toronto, Canada
M5H1J9 at the same address.
The Directors of MFS are Arnold D. Scott, James C. Baillie, John W. Ballen,
Kevin R. Parke, Thomas J. Cashman, Jr., Joseph W. Dello Russo, William W. Scott,
Jr., Donald A. Stewart, C. James Prieur and William W. Stinson. The Executive
Officers of MFS are Jeffrey L. Shames, Chairman and Chief Executive Officer, Mr.
Ballen, President, Mr. Arnold Scott, Senior Executive Vice President, Mr. Dello
Russo, Executive Vice President, Chief Financial Officer and Chief
Administrative Officer, Mr. Parke, Executive Vice President and Chief
Investment Officer, Mr. Cashman, Executive Vice President and Mr. William Scott,
Jr., Vice Chairman. As noted above, Messrs. Arnold Scott, Ballen and Shames also
serve as Trustees to the Fund.
The address of each Director and Executive Officer of MFS is 500 Boylston
Street, Boston, Massachusetts 02116. Each Director and Executive Officer
principally devotes his time to his role at MFS.
MFS provides investment advisory services to the following funds in the MFS
Family of Funds which have investment objectives and policies similar to those
of the Fund. The table below lists these other funds advised by MFS, the net
assets of those funds, and the management fee MFS received from those funds
during the fiscal years ended on the date noted.
OTHER FUNDS ADVISED BY MFS
-----------------------------------------------------------------------------------------------------------------
Management Fee
(as a Management
percentage of Fee, after
average daily Waivers (if
Net Assets under net assets) for any) for the
Management as of the Fiscal Year Fiscal Year
Fund December 31, 2000 Noted Noted Fiscal Year
-----------------------------------------------------------------------------------------------------------------
MFS Intermediate Income Trust $929,936,425 0.76%(1) N/A 10/31/00
-----------------------------------------------------------------------------------------------------------------
MFS/Sun Life Series Trust $ 33,318,906 0.75% N/A 12/31/00
Strategic Income Series
-----------------------------------------------------------------------------------------------------------------
(1) Lesser of (a) 0.32% of the Fund's average daily net assets plus 5.65% of the Fund's gross income, or (b) 0.85%.
The Fund has entered into certain other agreements with MFS or its affiliates
for administrative and shareholder services. The approval of the New Agreement
will not affect the services provided by MFS or its affiliates under these
agreements.
MFS provides the Fund with certain financial, legal, compliance, shareholder
communications and other administrative services pursuant to a Master
Administrative Services Agreement. Under this Agreement, the Fund pays MFS an
administrative fee of up to 0.0175% on the first $2.0 billion; 0.0130% on the
next $2.5 billion; 0.0005% on the next $2.5 billion; and 0.0% on amounts in
excess of $7.0 billion, per annum of the Fund's average daily net assets. This
fee reimburses MFS for a portion of the costs it incurs to provide such
services. For the fiscal year ended October 31, 2000, MFS received $86,796 from
the Fund for its services to the Fund under the Master Administrative Services
Agreement.
Pursuant to the Registrar, Transfer Agency and Service Agreement between the
Fund and MFS Service Center, Inc. (MFSC), a wholly owned subsidiary of MFS, MFSC
acts as the Fund's registrar and transfer agent as well as dividend disbursing
agent and agent in connection with the Fund's Dividend Reinvestment and Cash
Purchase Plan. For account maintenance, the Fund currently pays MFSC a fee based
on the total number of accounts for all closed-end funds advised by MFS for
which MFSC acts as registrar and transfer agent. If the total number of accounts
is less than 75,000, the annual account fee is $9.00 per account. If the total
number of accounts is 75,000 or more, the annual account fee is $8.00 per
account. For dividend services, MFSC charges $0.75 per dividend reinvestment and
$0.75 per cash infusion. If the total amount of fees related to dividend
services is less than $1,000 per month for all closed-end funds advised by MFS
for which MFSC acts as registrar and transfer agent, the minimum fee for the
Fund for these services will be $167 per month. In addition, MFSC is reimbursed
by the Fund for certain expenses incurred by MFSC on behalf of the Fund. For the
fiscal year ended October 31, 2000, MFSC received $243,173 from the Fund for its
services to the Fund under the Registrar, Transfer Agency and Service Agreement.
D. Actions and Recommendations of the Board of Trustees
At meetings of the Board of Trustees on April 10, June 12 and July 18, 2001, the
Board considered the standardization and modernization of the advisory
agreements of the Fund. The Board reviewed materials comparing the Current and
New Agreement and providing information about the potential benefits and costs
to shareholders of the adoption of the New Agreement. Among other things, the
Board of Trustees considered that the management fees under the Current
Agreement will not change under the New Agreement. The Board also considered the
potential efficiencies from the proposed standardization and modernization of
the Current Agreement's provisions. Based on this review, the Trustees,
including the Independent Trustees, approved the terms of the New Agreement and
submission of the New Agreement for the consideration of the shareholders of the
Fund.
If the New Agreement is approved, it will continue for an initial two-year term.
Thereafter, the New Agreement will continue as to the Fund from year to year if
that continuation is approved in accordance with applicable law.
REQUIRED VOTE
Approval of this Item will require the affirmative vote of the holders of a
"majority of the outstanding voting securities" of the Fund.
YOUR TRUSTEES HAVE CONCLUDED THAT THE NEW ADVISORY AGREEMENT WITH MFS WILL
BENEFIT YOUR FUND AND ITS SHAREHOLDERS. THE TRUSTEES UNANIMOUSLY RECOMMEND
VOTING FOR THE PROPOSAL.
ITEM 5 -- TO RATIFY THE SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS.
At the Meeting, you will be asked to ratify the selection of accountants for
your Fund. The Trustees, including a majority of the Trustees who are not
"interested persons" (as that term is defined in the 1940 Act) of the Fund, have
selected Ernst & Young LLP as independent public accountants for the Fund for
its next fiscal year. It is intended that proxies not limited to the contrary
will be voted in favor of ratifying that selection. No change to the Fund's
accountants is being proposed.
Ernst & Young has no direct or material indirect interest in the Fund.
Representatives of Ernst & Young are not expected to be present at the meeting.
Audit Committee Report. The Audit Committee of the Board of Trustees issued the
following report concerning the financial statements for the Fund's most recent
fiscal year.
The Audit Committee reviewed and discussed the audited financial
statements with Fund management. The Audit Committee also discussed
with Ernst & Young the matters required to be discussed by SAS 61
(Codification of Statements on Auditing Standards). The Audit Committee
received the written disclosures and the letter from Ernst & Young
required by Independence Standards Board Standard No. 1 (Independence
Discussions with Audit Committees), and discussed with Ernst & Young
its independence.
Based on this review and these discussions, the Audit Committee
recommended to the Board of Trustees that the audited financial
statements be included in the Fund's annual report to shareholders for
the fiscal year ended October 31, 2000 for filing with the Securities
and Exchange Commission.
Lawrence T. Perera
William J. Poorvu
Elaine R. Smith
David B. Stone
Fees Paid to Ernst & Young. The following table sets forth the aggregate fees
paid to Ernst & Young for the Fund's fiscal year ended October 31, 2000, for
professional services rendered for: (i) the audit of the Fund's financial
statements for that fiscal year; (ii) the audits of the annual financial
statements for all funds in the MFS complex audited by Ernst & Young; (iii)
financial information systems design and implementation services to the Fund,
MFS and any entity controlling, controlled by or under common control with MFS
that provides services to the Fund (including MFS Service Center, Inc. and MFS
Distributors, Inc.); and (iv) all other services (other than the foregoing
services for the Fund) to the Fund, MFS, and any entity controlling, controlled
by or under common control with MFS that provides services to the Fund
(Approximately 80% of this amount represents the fee for tax consulting services
rendered to MFS and MFS related entities that provide services to the Fund.).
The Audit Committee of the Fund considered whether the provision of information
technology services and of non-audit services by Ernst & Young is compatible
with the maintenance of that firm's independence.
-------------------------------------------------------------------------------------------------------------------
Financial All Other Fees
Information Systems (Other Than Fees
Design and Listed in Adjoining
Implementation Fees Columns) Paid
Aggregate Audit Paid by the Fund, by the Fund, MFS
Audit Fees Paid Fees Paid by All MFS and MFS Related and MFS Related
by the Fund for Funds in the MFS Entities that Entities that
its Most Recent Complex Audited Provide Services to Provide Services
Fiscal Year by Ernst & Young the Fund to the Fund
-------------------------------------------------------------------------------------------------------------------
MFS Multimarket Income Trust $31,600 $728,500 $0 $108,800
-------------------------------------------------------------------------------------------------------------------
REQUIRED VOTE
Approval of this proposal will require the affirmative vote of a majority of the
shares of the Fund voted at the Meeting in person or by proxy.
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THE RATIFICATION
OF THE SELECTION OF ACCOUNTANTS.
FUND INFORMATION
This section provides certain information about the Fund, including information
about executive officers, the number of Board and Committee meetings, Trustee
compensation and the identity of any shareholders holding 5% or more of the
outstanding shares of the Fund.
EXECUTIVE OFFICERS
The following table provides information about the executive officers of the
Fund. Each officer will hold office until his or her successor is chosen and
qualified, or until he or she retires, resigns or is removed from office.
JEFFREY L. SHAMES* (born 6/2/55) Trustee, Chairman and President
Massachusetts Financial Services Company, Chairman and Chief Executive
Officer.
JAMES R. BORDEWICK, JR.* (born 3/6/59) Assistant Secretary
and Assistant Clerk
Massachusetts Financial Services Company, Senior Vice President and
Associate General Counsel.
MARK E. BRADLEY* (born 11/23/59) Assistant Treasurer
Massachusetts Financial Services Company, Vice President (since March
1997); Putnam Investments, Vice President (prior to March 1997).
STEPHEN E. CAVAN* (born 11/6/53) Secretary and Clerk
Massachusetts Financial Services Company, Senior Vice President,
General Counsel and Secretary.
ROBERT R. FLAHERTY* (born 09/18/63) Assistant Treasurer
Massachusetts Financial Services Company, Vice President (since August
2000); UAM Fund Services, Senior Vice President (since 1996).
LAURA F. HEALY* (born 3/20/64) Assistant Treasurer
Massachusetts Financial Services Company, Vice President (since
December 1996); State Street Bank and Trust Company, Assistant Vice
President (prior to December 1996).
ELLEN MOYNIHAN* (born 11/13/57) Assistant Treasurer
Massachusetts Financial Services Company, Vice President (since
September 1996).
JAMES O. YOST* (born 6/12/60) Treasurer
Massachusetts Financial Services Company, Senior Vice President.
* "Interested person" (as defined in the 1940 Act) of MFS, the address of
which is 500 Boylston Street, Boston, Massachusetts.
BOARD AND COMMITTEE MEETINGS
The Board of Trustees and the Committees held the following number of meetings
during the Fund's fiscal year ended October 31, 2000:
----------------------------------------------------------------------------------------------------------
Number of
Number of Board Number of Audit Nominating
Meetings Committee Meetings Committee Meetings
----------------------------------------------------------------------------------------------------------
MFS Multimarket Income Trust 6 4 0
----------------------------------------------------------------------------------------------------------
TRUSTEE COMPENSATION TABLE
The table below shows the cash compensation paid to the current Trustees (other
than Messrs. Schmidt and Stone, who will be retiring) and the retirement
benefits accrued as part of Fund expenses to those Trustees for the Fund's
fiscal year ended October 31, 2000. As interested persons of MFS, Messrs.
Ballen, Scott and Shames do not receive any compensation or retirement plan
benefits from the Fund for their services as Trustees. Mr. Gutow was appointed
as a Trustee of the Fund effective ______ ___, 2001, and did not receive
compensation from the Fund for the fiscal year ended October 31, 2000.
----------------------------------------------------------------------------------------------------------
Retirement Benefits Total Trustee Fees
Trustee Fees Accrued as Part of Fund from Fund and Fund
Trustee from Fund(1) Expenses Complex(2)
----------------------------------------------------------------------------------------------------------
J. Atwood Ives $15,000 $6,600 $152,145
----------------------------------------------------------------------------------------------------------
Lawrence T. Perera $15,000 $7,583 $146,230
----------------------------------------------------------------------------------------------------------
William J. Poorvu $15,000 $7,583 $153,405
----------------------------------------------------------------------------------------------------------
Elaine R. Smith $15,000 $7,350 $144,160
----------------------------------------------------------------------------------------------------------
--------------------------
(1) During the fiscal year ended October 31, 2000, Messrs. Ives and Smith deferred $15,000 of compensation
pursuant to the deferred compensation plan.
(2) For calendar year 2000. All Trustees receiving compensation from the Fund served as Trustee of 48
funds within the MFS Family of Funds having aggregate net assets at December 31, 2000 of approximately
$63.3 billion.
The Fund currently has a retirement plan for non-interested Trustees and
Trustees who are not officers of the trust. Under this plan, Trustees must
retire upon reaching a specified age and thereafter are entitled to annual
payments during their lifetime of up to 50% of their average annual compensation
(based on the three years prior to retirement) depending on length of service.
Trustees must have served as Trustees for at least five years to be entitled to
these payments. A Trustee may also retire prior to the specified retirement age
and receive reduced payments if he or she has completed at least 5 years of
service. Under the plan, a Trustee (or his or her beneficiaries) will also
receive benefits for a period of time in the event the Trustee is disabled or
dies. These benefits will also be based on the Trustee's average annual
compensation and length of service. The Fund will accrue its allocable portion
of compensation expenses under the retirement plan each year to cover the
current year's service and amortize past service cost.
The Trustees will terminate the Fund's retirement plan effective December 31,
2001 with respect to those Trustees listed in the table above, subject to
shareholder approval of Item 1 relating to the consolidation of the Board of
Trustees. The Trustees are considering whether adjustments should be made to the
fees they receive from the Fund in consideration for the loss of future benefit
accruals under the retirement plans. Upon termination of the plan, an amount
equivalent to the present value of each applicable Trustee's accrued benefits
thereunder through the date of termination would be calculated. The Trustees
would defer receipt of these accrued benefits under a new deferred compensation
plan, under which the value of the benefits would be periodically adjusted as
though an equivalent amount had been invested in shares of the Fund. The
deferred compensation would be paid to the Trustees upon retirement or
thereafter.
The Trustees also have adopted a deferred compensation plan for disinterested
Trustees of the Fund that enables these Trustees to elect to defer all or a
portion of the annual fees they are entitled to receive from the Fund until a
payment date elected by the Trustee (or the Trustee's termination of services).
Under the plan, the compensation deferred by Trustees is periodically adjusted
as though an equivalent amount had been invested in shares of one or more funds
in the MFS Family of Funds designated by the Trustee. The amount paid to the
Trustee on the payment date will be determined based on the performance of the
selected funds. To the extent permitted by the 1940 Act, the Fund may invest in
shares of these other selected MFS Funds in order to match the deferred
compensation obligation. Deferral of fees in accordance with the plan will not
materially affect the Fund's assets, liabilities or net income per share. The
plan does not obligate the Fund to retain the services of any Trustee or pay any
particular level of compensation to any Trustee. The plan is not funded and the
Fund's obligation to pay the Trustees' deferred compensation is a general
unsecured obligation.
INTERESTS OF CERTAIN PERSONS
As of July 27, 2001, the following Trustees and officers owned the number of
shares of the Fund noted in the table below:
NAME OF TRUSTEE NUMBER OF
OR OFFICER SHARES OWNED PERCENT OF FUND
J. Atwood Ives 1000.0000
Lawrence T. Perera 2404.2146
William J. Poorvu 4519.9641
Arnold D. Scott 412.4662
Elaine R. Smith 216.8172
TOTAL HOLDINGS OF TRUSTEES 8553.4621
AND OFFICERS AS A GROUP
As of July 27, 2001, to the best knowledge of the Fund, the following
shareholders beneficially owned 5% or more of the outstanding shares of the
Fund:
NAME AND ADDRESS NUMBER OF OUTSTANDING PERCENTAGE OF OUTSTANDING
OF SHAREHOLDER SHARES OWNED SHARES OWNED
MANNER OF VOTING PROXIES
All proxies received by management will be voted on all matters presented at the
Meeting, and if not limited to the contrary, will be voted "for" the matters
listed in the accompanying Notice of Annual Meeting of Shareholders and "for"
any other matters deemed appropriate. The presence in person or by proxy of the
holders of a majority of the outstanding shares of the Fund entitled to vote is
required to constitute a quorum at the Meeting for purposes of voting on Items 1
through 5.
For the purposes of determining the presence of a quorum, abstentions and broker
"non-votes" (that is, proxies from brokers or nominees indicating that such
persons have not received instructions from the beneficial owner or other
persons entitled to vote shares on a particular matter with respect to which
brokers or nominees do not have discretionary power) will be treated as shares
that are present but which have not been voted. Abstentions and broker
"non-votes" will not constitute a vote "for" or "against" a matter and will be
disregarded in determining the "votes cast" on an issue. Abstentions and broker
"non-votes" will have the same effect as a vote "against" Items 2, 3 and 4, and
will have no effect on Items 1 or 5.
The Fund has engaged the services of Georgeson Shareholder Communications Inc.
to assist in the solicitation of proxies for the Fund. The costs of the proxy
solicitation are estimated to be $__________ and will be borne by the Fund. The
Fund will reimburse the record holders of its shares for their expenses incurred
in sending proxy material to and obtaining voting instructions from beneficial
owners.
The Fund knows of no other matters to be brought before the Meeting. If,
however, because of any unexpected occurrence, any other matters properly come
before the Meeting, it is the Fund's intention that proxies not limited to the
contrary will be voted in accordance with the judgment of the persons named in
the enclosed form of proxy.
SUBMISSION OF PROPOSALS
Proposals of shareholders which are intended to be presented at the 2002 Annual
Meeting of Shareholders must be received by the Fund on or prior to ________ __,
____.
SECTION 16(a) -- BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires trustees,
directors and certain directors and certain officers of the Fund and MFS, and
persons who own more than 10% of the Fund's shares, to file reports of ownership
and changes in ownership with the SEC and the New York Stock Exchange. Such
persons are required by SEC regulation to furnish the Fund with copies of all
Section 16(a) forms they file.
Based solely on review of the copies of Forms 3, 4, and 5 and amendments thereto
furnished to the Fund with respect to its most recent fiscal year, or written
representations that no Forms 5 were required, the Fund believes that, during
the fiscal year ended October 31, 2000, all Section 16(a) filing requirements
applicable to Trustees, directors and certain officers of the Fund and MFS and
greater than ten percent beneficial owners were complied with.
ADDITIONAL INFORMATION
In the event that sufficient votes in favor of the proposals set forth in the
Notice of Annual Meeting are not received by October 12, 2001, the persons named
as appointed proxies on the enclosed proxy card may propose one or more
adjournments of the Meeting to permit further solicitation of proxies. Any such
adjournment will require the affirmative vote of the holders of a majority of
the shares present in person or by proxy at the session of the Meeting to be
adjourned. The persons named as appointed proxies on the enclosed proxy card
will vote in favor of any such adjournment those proxies required to be voted in
favor of the proposal for which further solicitation of proxies is made. They
will vote against any such adjournment those proxies required to be voted
against such proposal. The meeting may be adjourned as to one or more items. The
costs of any additional solicitation and of any adjournment session will be
borne by the Fund.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY.
August 10, 2001
APPENDIX A
APPENDIX B
NOTE: THIS APPENDIX CONTAINS A COMPARISON OF THE EXISTING DECLARATION OF THE
FUND AND THE STANDARDIZED RESTATED DECLARATION PROPOSED TO BE USED FOR
CLOSED-END FUNDS IN THE MFS FAMILY OF FUNDS. THE DECLARATION HAS BEEN MARKED TO
SHOW THE CHANGES THAT WILL BE MADE IF THE RESTATED DECLARATION PROPOSED IN ITEM
2 IS APPROVED AND ADOPTED. DELETED TEXT IS MARKED THROUGH AND ADDED TEXT APPEARS
IN ITALICS. FOR EDGAR DELETED TEXT IS SET IN BRACKETS AND ADDED TEXT IS SET
IN DOUBLE BRACKETS. THE COVER PAGE AND TABLE OF CONTENTS FOR BOTH THE EXISTING
DECLARATION AND THE RESTATED DECLARATION HAVE BEEN OMITTED.
[[AMENDED AND RESTATED]]
DECLARATION OF TRUST
OF
MFS MULTIMARKET INCOME TRUST
[Dated January 9, 1987]
[[Dated as of ____________]]
[DECLARATION OF TRUST made January 9, 1987 by the Trustees:]
[WHEREAS, the Trustees desire to establish a trust]
[[WHEREAS, MFS Multimarket Income Trust was established pursuant to a
Declaration of Trust dated January 9, 1987, as amended (the "Original
Declaration"),]] for the investment and reinvestment of funds contributed
thereto[); and][[;]]
WHEREAS, the Trustees desire that the beneficial interest in the
[trust] [[Trust]] assets [[continue to]] be divided into transferable [shares of
beneficial interest] [[Shares of Beneficial Interest (without par value)]], as
hereinafter provided[:][[;]]
[[WHEREAS, the Trustees wish to amend and restate the Original
Declaration in its entirety, and hereby certify that this Amended and Restated
Declaration of Trust has been amended and restated in accordance with the
provisions of the Original Declaration;]]
NOW THEREFORE, the Trustees hereby [declare] [[confirm]] that all money
and property contributed to the [trust established] [[Trust]] hereunder shall be
held and managed in trust for the benefit of holders, from time to time, of the
[shares of beneficial interest] [[Shares of Beneficial Interest (without par
value)]] issued hereunder and subject to the provisions hereof[[, and that the
Original Declaration, including all appendices, is amended and restated in its
entirety as follows]].
ARTICLE I
NAME AND DEFINITIONS
--------------------
Section 1.1[[.]] Name. The name of the [trust created hereby is the
"MFS Multimarket Income Trust."] [[Trust is MFS Multimarket Income Trust.]]
[Section 1.2 ]
[[Section 1.2.]] Definitions. Wherever they are used herein, the
following terms have the following respective meanings:
(a) "By-Laws" means the By-laws referred to in Section 3.9 hereof, as
from time to time amended.
(b) [the terms "Commission," "Interested Person," and "Majority
Shareholder Vote," (the 67% or 50% requirement of the third sentence of Section
2(a)(42) of the 1940 Act, whichever may be applicable) have the meanings given
them][["Commission" has the meaning given that term]] in the 1940 Act.
(c) "Declaration" means this [[Amended and Restated]] Declaration of
Trust[[,]] as amended from time to time. Reference in this Declaration of Trust
to "Declaration," "hereof," "herein" and "hereunder" shall be deemed to refer to
this Declaration rather than the article or section in which such words appear.
(d) "Distributor" means [the] [[a]] party[, other than] [[furnishing
services to]] the Trust[,] [[pursuant]] to [the] [[any]] 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.]]
[[(h)]][(f) The]"1940 Act" means the Investment Company Act of 1940 and
the Rules and Regulations thereunder, as amended from time to time[[, and as
such Act or the Rules and Regulations thereunder may apply to the Trust pursuant
to any exemptive order or similar relief or interpretation issued by the
Commission under such Act.]]
[(g)]
[[(i)]] "Person" means and includes individuals, corporations,[[
limited liability companies,]] partnerships, trusts, associations, joint
ventures and other entities, whether or not legal entities, and governments and
agencies and political subdivisions thereof, whether domestic or foreign.
[(h)]
[[(j)]] "Shareholder" means a record owner of outstanding Shares.
[(i)]
[[(k)]] "Shares" means the Shares of Beneficial Interest into which the
beneficial interest in the Trust shall be divided from time to time [and][[. The
term "Shares"]] includes fractions of Shares as well as whole Shares.
[(j)]
[[(l)]] "Transfer Agent" means [the party, other than the Trust, to a]
[[a party furnishing services to the Trust pursuant to any transfer agency]]
contract described in Section [4.3] [[4.4]] hereof.
[(k) The]
[[(m)]] "Trust" means the [entity specified in Section 1.1 above.]
[[trust hereunder.]]
[(l) The]
[[(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.
[(m) The]
[[(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.
[[(p) "Trustees Emeritus" means any former Trustees who, from time
to time, are appointed by the Trustees to serve as trustees emeritus of the
Trust in accordance with the guidelines and conditions for such service adopted
by the Trustees from time to time, for so long as they serve in that capacity.
Trustees Emeritus, in their capacity as such, are not Trustees of the Trust for
any purpose, and shall not have any powers or obligations of Trustees
hereunder.]]
ARTICLE II
TRUSTEES
Section 2.1. Number of Trustees. The number of Trustees shall be such
number as shall be fixed from time to time by a [written instrument signed by a]
majority of the Trustees, provided, however, that the number of Trustees shall
in no event be less than three (3) nor more than fifteen (15). No reduction in
the number of Trustees shall have the effect of removing any Trustee from office
prior to the expiration of his [[or her]] term unless the Trustee is
specifically removed pursuant to Section 2.2 [of this Article II] [[hereof]] at
the time of the decrease.
Section 2.2. Term of Office of Trustees. The Board of Trustees shall be
divided into three classes. Within the limits above specified, the number of
Trustees in each class shall be determined by resolution of the Board of
Trustees. The term of office of [all of] the [Trustees] [[first class]] shall
expire on the date of [[the]] first annual meeting of [shareholders]
[[Shareholders]] or special meeting in lieu thereof following [the effective
date of the Registration Statement relating to the Shares under the Securities
Act of 1933, as amended] [[January 1, 2002]]. The term of office of the [first]
[[second]] class shall expire on the date of the second annual meeting of
[shareholders] [[Shareholders]] or special meeting in lieu thereof. The term of
office of the [second] [[third]] class shall expire on the date of the third
annual meeting of [shareholders or special meeting in lieu thereof. The term of
office of the third class shall expire on the date of the fourth annual meeting
of shareholders] [[Shareholders]] or special meeting in lieu thereof. Upon
expiration of the term of office of each class as set forth above, the number of
Trustees in such class, as determined by the Board of Trustees, shall be elected
for a term expiring on the date of the third annual meeting of [shareholders]
[[Shareholders]] or special meeting in lieu thereof following such expiration to
succeed the Trustees whose terms of office expire. The Trustees shall be elected
at an annual meeting of the [shareholders] [[Shareholders]] or special meeting
in lieu thereof called for that purpose, except as provided in Section 2.3 [of
this Article and each] [[hereof.]]
[[Each]] Trustee [elected] shall hold office until [his ][[the earlier
of his or her death or the election and qualification of his or her]] successor
[shall have been elected and shall have qualified]; except [(a)] that[[:]]
[[(a)]] any Trustee may resign his [[or her]] trust (without need for
prior or subsequent accounting) by an instrument in writing signed by [him]
[[that Trustee]] and delivered to the [other Trustees] [[Trust]], 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 ][[at any time, with or without
cause,]] by written instrument[,] signed by at least [two-thirds]
[[three-quarters]] 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] [[any Trustee who has attained a
mandatory retirement age established pursuant to any written policy adopted from
time to time by at least two-thirds of the Trustees shall, automatically and
without action of such Trustee or the remaining Trustees, be deemed to have
retired in accordance with the terms of such policy, effective as of the date
determined in accordance with such policy; and]]
[[(d) a Trustee may be removed at any meeting of Shareholders by a
vote of Shares representing two-thirds of the outstanding Shares of the Trust
entitled to vote for the election of such Trustee]].
Upon the resignation[[, retirement]] or removal of a Trustee, or his [[or her]]
otherwise ceasing to be a Trustee, [he] [[that individual]] 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]
[[Property]] held in the name of the resigning[[, retiring]] or removed Trustee.
Upon the incapacity or death of any Trustee, [his] [[that Trustee's]] legal
representative shall execute and deliver on his [[or her]] behalf such documents
as the remaining Trustees shall require as provided in the preceding sentence.
[[Except to the extent expressly provided in a written agreement to
which the Trust is a party or in a written policy adopted by the Trustees, no
resigning or removed Trustee shall have any right to any compensation for any
period following his or her resignation or removal, or any right to damages on
account of such removal.]]
Section 2.3. Resignation and Appointment of Trustees. In case of the
declination, death, resignation, retirement[,] [[or]] removal [or inability] of
any of the Trustees, or in case a vacancy shall, by reason of an increase in
number [[of Trustees]], or for any other reason, exist, [[a majority of]] the
remaining Trustees [shall] [[may]] fill such vacancy by appointing such other
[person] [[individual]] 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 or appointment]
[[appointed]] shall have accepted in writing such appointment and agreed in
writing to be bound by the terms of the Declaration. [Within twelve months of
such appointment, the Trustees shall cause notice of such appointment to be
mailed to each Shareholder at his address as recorded on the books of the
Trustees.] An appointment of a Trustee may be made by the Trustees then in
office [and notice thereof mailed to Shareholders as aforesaid] in anticipation
of a vacancy to occur by reason of retirement, resignation[[, removal]] 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[[, removal]] or increase in number of Trustees. The
power of appointment is subject to [the] [[all applicable]] 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] [[the]] Declaration. Whenever a vacancy in the number of
Trustees shall occur, until such vacancy is filled as provided in Section 2.3,
[the ][[or while any Trustee is incapacitated, the other]] 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[[, and only such other Trustees shall be counted for the purposes of
the existence of a quorum or the taking of any action to be taken by the
Trustees]]. A written instrument certifying the existence of such vacancy [[or
incapacity]] signed by a majority of the Trustees shall be conclusive evidence
of the existence [of such vacancy] [[thereof]].
Section 2.5. Delegation of Power to Other Trustees. [Any] [[Subject to
requirements imposed by the 1940 Act and other applicable law, any]] Trustee
may, by power of attorney, delegate his power for a period not exceeding six
[(6)] months at any one time to any other Trustee or Trustees; provided that in
no case shall [less] [[fewer]] than two [(2)] Trustees personally exercise the
powers granted to the Trustees under the Declaration except as [herein]
otherwise expressly provided [[herein]].
ARTICLE III
POWERS OF TRUSTEES
------------------
Section 3.1. General. [The][[ Subject to the provisions of the
Declaration, 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 [[or any other power of the Trustees hereunder]].
Such powers of the Trustees may be exercised without order of or resort to any
court.
Section 3.2. Investments. (a) The Trustees shall have the power [to]:
(i) [[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 [United States] [[securities
of every nature and kind, U.S.]] and foreign currencies, any form of gold [and]
[[or]] other precious [metals] [[metal]], commodity contracts, [options] [[any
form of option contract]], contracts for the future acquisition or delivery of
[securities and securities of every nature and kind,][[fixed income or other
securities, derivative instruments of every kind, "when-issued" or standby
contracts, and all types of obligations or financial instruments,]] including,
without limitation, all types of bonds, debentures, stocks, negotiable or
non-negotiable instruments, obligations, evidences of indebtedness, certificates
of deposit or indebtedness, commercial paper, repurchase agreements, bankers'
acceptances, and other securities of any kind, issued, created, guaranteed or
sponsored by any and all Persons, including, without limitation,
[[(A)]] states, territories and possessions of the United States and
the District of Columbia and any political [subdivisions, agencies or
instrumentalities thereof and the United States] [[subdivision, agency or
instrumentality of any such Person,]]
[[(B) the U.S.]] Government, any foreign government, [any political
subdivisions thereof or their agencies or instrumentalities, international
instrumentalities or by] [[or any political subdivision or any agency or
instrumentality of the U.S. Government or any foreign government,]]
[[(C) any international instrumentality,]]
[[(D)]] any bank or savings institution, or
[by]
[[(E)]] any corporation or organization organized under the laws of the
United States or of any state, territory or possession thereof, or [by any
corporation or organization organized] under any foreign law[, or in "when
issued" contracts ][[;]] [for any such securities, or ][[to]] retain Trust
assets in cash and from time to time [[to]] change the investments [of] [[in
which]] the assets of the Trust [[are invested]]; 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] [[Persons]]
to exercise any of said rights, powers and privileges in respect of any of said
[instruments.] [[investments; 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
[[or desirable]] 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 [[securities or]]
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.
[[(c) Notwithstanding any other provision of the Declaration to the
contrary, the Trustees shall have the power in their discretion without any
requirement of approval by Shareholders to either invest all or a portion of the
Trust Property, or sell all or a portion of such Trust Property and invest the
proceeds of such sales, in one or more other investment companies to the extent
not prohibited by the 1940 Act.]]
Section 3.3. Legal Title. Legal title to all [the] Trust Property shall
be vested in the Trustees as joint tenants except that the Trustees shall have
power to cause legal title to any Trust Property to be held by or in the name of
one or more of the Trustees, or in the name of the Trust, or in the name of any
other Person [as] [[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] [[person]] who may hereafter become a Trustee.
Upon the resignation, [[retirement,]] removal or death of a Trustee [he][[, such
Trustee]] 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 and VIII hereof, to apply to
any such [[repurchase, redemption,]] retirement, cancellation or acquisition of
Shares any funds [or property] of the Trust [[or other Trust Property,]] whether
capital or surplus or otherwise[, to the full extent now or hereafter permitted
by the laws of the Commonwealth of Massachusetts governing business
corporations].
Section 3.5. Borrowing Money; Lending Trust Property. The Trustees
shall have power to borrow money or otherwise obtain credit and to secure the
same by mortgaging, pledging or otherwise subjecting as security the [assets of
the] Trust [[Property]], to endorse, guarantee, or undertake the performance of
any obligation, contract or engagement of any other Person and to lend Trust
[property] [[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][[, any Investment Adviser, Distributor, custodian, agent or independent
contractor]] 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 [[appropriate or]] expedient.
Section 3.7. Collection and Payment. The Trustees shall have power to
collect all property due to the Trust; to pay all claims, including taxes,
against the Trust Property; to 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. 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[[, Trustees]]
and Trustees [[Emeritus]].
Section 3.9. Manner of Acting; By-Laws. Except as otherwise provided
herein[[, in the 1940 Act]] 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 [(][[at which]] a quorum [being present)] [[is 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] [[two-thirds of]]
the Trustees. The Trustees may adopt By-Laws not inconsistent with [this]
[[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] [[permitted therein at any time]].
Section 3.10. Miscellaneous Powers. [The] [[Without limiting the
foregoing, 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, [[in each case with or without cause,]]
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, [[such insurance as
they may deem necessary or appropriate for the conduct of the business of the
Trust, including, without limitation,]] insurance policies insuring the
[Shareholders, Trustees, ][[assets of the Trust and payment of distributions and
principal on its portfolio investments, and insurance policies insuring
Shareholders, any administrator, Trustees, Trustees Emeritus,]] officers,
employees, agents, [investment advisers, distributors] [[any Investment Adviser,
any Distributor]], selected dealers or independent contractors of the Trust
against all claims arising by reason of holding any such position or by reason
of any action taken or omitted by any such Person in such capacity, whether or
not constituting negligence, or whether or not the Trust would have the power to
indemnify such Person against such liability;
(e) establish pension, profit[[-]]sharing, [share] [[Share]] purchase,
[[deferred compensation,]] and other retirement, incentive and benefit plans for
any Trustees, officers, employees [and] [[or]] agents of the Trust;
(f) to the extent permitted by law, indemnify any person with whom the
Trust has dealings, including [the] [[any]] Investment Adviser, [[administrator,
custodian,]] Distributor, Transfer Agent, [and selected dealers] [[shareholder
servicing agent and any dealer]], to such extent as the Trustees shall
determine;
(g) guarantee indebtedness or contractual obligations of others;
(h) determine and change the fiscal year of the Trust and the method by
which its accounts shall be kept; and
(i) adopt a seal for the Trust [but][[, 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 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. No officer, Trustee or
Member of the Advisory Board of the Trust, and no member, partner, officer,
director or trustee of the Investment Adviser or of the Distributor, and no
Investment Adviser or Distributor of the Trust, shall take long or short
positions in the securities issued by the Trust.]
ARTICLE IV
INVESTMENT ADVISER, DISTRIBUTOR[[, CUSTODIAN]] AND TRANSFER AGENT
-----------------------------------------------------------------
Section 4.1. Investment Adviser. Subject to [a Majority Shareholder
Vote] [[applicable requirements of the 1940 Act]], the Trustees may in their
discretion from time to time enter into one or more investment advisory or
management contracts whereby [a] [[the other]] party to [[each]] such contract
shall undertake to furnish the Trust such management, investment advisory,
statistical and research facilities and services, promotional activities, and
such other facilities and services, if any, as the Trustees shall from time to
time consider desirable and all upon such terms and conditions as the Trustees
may in their discretion determine. Notwithstanding any [provisions]
[[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 [[of]] such purchases, sales, loans or exchanges
shall be deemed to have been authorized by all the Trustees.[[ Such services may
be provided by one or more Persons.]]
Section 4.2. Distributor. [The] [[Subject to applicable requirements of
the 1940 Act, the]] Trustees may in their discretion from time to time enter
into [a contract,] [[one or more exclusive or non-exclusive distribution
contracts]] providing for the sale of Shares[[,]] whereby the Trust may either
agree to sell the Shares to the other party to [the] [[any such]] contract or
appoint [[any]] such other party its sales agent for such Shares. In either
case, [the] [[any such]] contract shall be on such terms and conditions as the
Trustees may in their discretion determine[[, provided that such terms and
conditions are]] not inconsistent with the provisions of [this Article IV] [[the
Declaration]] 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 [[or agency agreements]] with [registered] securities dealers [[or
other Persons]] to further the purpose of the distribution [of the Shares.] [[or
repurchase of the Shares. Such services may be provided by one or more
Persons.]]
[Section 4.3. ]
[[Section 4.3. Custodian. The Trustees may in their discretion from
time to time enter into one or more contracts whereby the other party to each
such contract shall undertake to furnish such custody services to the Trust 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, provided that
such terms and conditions are not inconsistent with the provisions of the 1940
Act, the Declaration or the By-Laws. The Trustees may authorize any custodian to
employ one or more sub-custodians from time to time to perform such of the
services of the custodian as the Trustees shall from time to time consider
desirable. Services described in this Section may be provided by one or more
Persons. ]]
[[Section 4.4.]] Transfer Agent. The Trustees may in their discretion
from time to time enter into [a] [[one or more transfer agency or sub-]]transfer
agency and shareholder [service contract or] [[servicing]] contracts whereby the
other party to [[each]] such contract shall undertake to furnish [[such]]
transfer agency and/or shareholder services to the Trust[. The contract or
contracts shall have] [[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[[, provided that such terms and conditions are]] not
inconsistent with [[the provisions of]] the Declaration or the By-Laws. Such
services may be provided by one or more Persons.
Section [4.4] [[4.5]]. Parties to Contract. Any contract of the
character described in [Sections 4.1, 4.2 or 4.3] [[any Section]] of this
Article IV [or any Custodian contract, as described in the By-laws,] may be
entered into with any Person, although one or more of the Trustees or officers
of the Trust may be an officer, partner, director, trustee, shareholder, or
member of such other party to the contract, and no such contract shall be
invalidated or rendered voidable by reason of the existence of any such
relationship; nor shall any Person holding such relationship be liable merely by
reason of such relationship for any loss or expense to the Trust under or by
reason of [said] [[any such]] 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]
[[Laws]]. The same Person may be the other party to contracts entered into
pursuant to Sections 4.1, 4.2 [and][[,]] 4.3 [[and 4.4]] 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] [[4.5]].
ARTICLE V
LIMITATIONS OF LIABILITY OF SHAREHOLDERS,
-----------------------------------------
TRUSTEES AND OTHERS
-------------------
Section 5.1. No Personal Liability of Shareholders[, Trustees, etc.
Subject to Section 5.3, no][[. No Shareholder or former]] 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] [[solely by reason of being or
having been a]] 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 [[and former Shareholder]]
harmless from and against all claims and liabilities to which such Shareholder
may become subject [[solely]] by reason of his [[or her]] being or having been a
Shareholder [[(other than taxes payable by virtue of owning Shares)]], 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 [[or former 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 [[or former Shareholder]] in any appropriate situation
even though not specifically provided herein. [[The Trust shall, upon request by
a Shareholder or former Shareholder, assume the defense of any claim made
against such Shareholder for any act or obligation of the Trust and satisfy any
judgment thereon from the assets of the Trust.]]
[[Section 5.2. Limitation of]] [Section 5.2. Non-] Liability of
Trustees[, etc. Subject to Section 5.3, no] [[and Others. (a) No]] Trustee,
[[Trustee Emeritus,]] 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] [[subject to any liability whatsoever to any Person in
connection with Trust Property or the affairs of the Trust, and no Trustee or
Trustee Emeritus shall be responsible or liable in any event for any neglect or
wrongdoing of any officer, employee or agent of the Trust or for the act of
omission of any other Trustee or Trustee Emeritus. Notwithstanding anything to
the contrary in this Section 5.2(a) or otherwise, nothing in the Declaration
shall protect any Trustee, Trustee Emeritus, officer, employee or agent of the
Trust against any liability to the Trust or its Shareholders to which he, she or
it would otherwise be subject by reason]] of [trust) except for his own bad
faith,] willful misfeasance, [[bad faith,]] gross negligence or reckless
disregard of [his duties.] [[the duties involved in the conduct of his, her or
its office or position with or on behalf of the Trust.]]
[[(b) All persons extending credit to, contracting with or having
claim against the Trust shall look solely to the assets of the Trust for payment
under such credit, contract or claim; and neither any Trustee or Trustee
Emeritus, nor any of the Trust's officers, employees or agents, whether past,
present or future, shall be personally liable therefor.]]
Section 5.3. Mandatory Indemnification. (a) Subject to the exceptions
and limitations contained in paragraph (b) below:
(i) every person who is or has been a Trustee[[, Trustee Emeritus]] or
officer of the Trust [[(hereinafter referred to as a "Covered Person")]] shall
be indemnified by the Trust against all liability and against all expenses
reasonably incurred or paid by him [[or her]] in connection with any claim,
action, suit or proceeding in which [he] [[that individual]] becomes involved as
a party or otherwise by virtue of [his] being or having been a Trustee[[,
Trustee Emeritus]] or officer and against amounts paid or incurred by [him]
[[that individual]] 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 [[or compromise]], fines,
penalties and other liabilities.
(b) No indemnification shall be provided hereunder to a [Trustee or
officer] [[Covered Person]]:
(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] [[the Covered Person]] engaged in willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of [his] [[that individual's]] office;
(ii) with respect to any matter as to which [he] [[the Covered Person]]
shall have been finally adjudicated not to have acted in good faith in the
reasonable belief that [his] [[that individual's]] action was in the best
interest of the Trust; [[or]]
(iii) in the event of a settlement involving a payment by a Trustee[[,
Trustee Emeritus]] or officer or other disposition not involving a final
adjudication as provided in paragraph (b)(i) or (b)[(ii)][[(ii) above]]
resulting in a payment by a [Trustee or officer] [[Covered Person]], unless
there has been either a determination that such [Trustee or officer] [[Covered
Person]] did not engage in willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of [his] [[that
individual's]] 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]
[[that individual]] did not engage in such conduct:
(A) by vote of a majority of the Disinterested Trustees [[(as
defined below)]] acting on the matter (provided that a majority of the
Disinterested Trustees then in office act on the matter); or
(B) by written opinion of [independent legal counsel.][[(i)
the then-current legal counsel to the Trustees who are not Interested Persons of
the Trust or (ii) other legal counsel chosen by a majority of the Disinterested
Trustees (or if there are no Disinterested Trustees with respect to the matter
in question, by a majority of the Trustees who are not Interested Persons of the
Trust) and determined by them in their reasonable judgment to be independent.]]
(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] [[Covered Person]] may
now or hereafter be entitled, shall continue as to a [Person] [[person]] who has
ceased to be [such Trustee or officer] [[a Covered Person]] and shall inure to
the benefit of the heirs, executors and administrators of such [Person]
[[person]]. Nothing contained herein shall [[limit the Trust from entering into
other insurance arrangements or]] affect any rights to indemnification to which
[[Trust]] personnel [other than Trustees and officers][[, including Covered
Persons,]] may be entitled by contract or otherwise under law.
(d) Expenses of preparation and presentation of a defense to any claim,
action, suit, or proceeding of the character described in paragraph (a) of this
Section 5.3 shall be advanced by the Trust prior to final disposition thereof
upon receipt of an undertaking by or on behalf of the [recipient] [[Covered
Person]] to repay such amount if it is ultimately determined that [he] [[the
Covered Person]] 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 [[meeting the requirement in
Section 5.3(b)(iii)(B) above]] 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] [[Covered Person]]
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.
[[(e) With respect to any such determination or opinion referred to
in clause (b)(iii) above or clause (d)(ii) above, a rebuttable presumption shall
be afforded that the Covered Person has not engaged in willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of such Covered Person's office in accordance with pronouncements of the
Commission.]]
Section 5.4. No Bond Required [of Trustees]. No Trustee[[, Trustee
Emeritus or officer]] shall be obligated to give any bond or other security for
the performance of any of his [[or her]] duties hereunder.
Section 5.5. No Duty of Investigation; Notice in Trust Instruments[,
etc]. No purchaser, lender, [transfer agent ][[shareholder servicing agent,
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 [[or officers]] shall recite that the same is executed or made by
them not individually, but as [[or on behalf of]] Trustees under the
Declaration, and that the obligations of any such instrument are not binding
upon any of the Trustees[[, officers]] or Shareholders[,] individually, but bind
only the [trust] [[Trust]] estate, and may contain any further recital [which
they or he may deem] [[deemed]] appropriate, but the omission of such recital
shall not operate to bind any of the Trustees[[, officers]] or Shareholders
individually. The Trustees [shall at all times] [[may]] maintain insurance for
the protection of the Trust Property, [its] Shareholders, Trustees, [[Trustees
Emeritus,]] 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. ][[Good Faith Action; Reliance
on Experts]][[. The exercise by the Trustees or the officers of the Trust of
their powers and discretions hereunder in good faith and with reasonable care
under the circumstances then prevailing shall be binding upon everyone
interested. The Trustees or the officers of the Trust shall not be liable for
errors of judgment or mistakes of fact or law.]] Each Trustee and officer or
employee of the Trust shall, in the performance of his [[or her]] duties, be
[[under no liability and]] fully and completely justified and protected with
regard to any act or any failure to act resulting from reliance in good faith
upon the books of account or other records of the Trust, upon [an opinion]
[[advice]] 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,[[
custodian, any shareholder servicing 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.
[[Section 5.7. Derivative Actions. No Shareholder shall have the right
to bring or maintain any court action, proceeding or claim on behalf of the
Trust without first making demand on the Trustees requesting the Trustees to
bring or maintain such action, proceeding or claim. Such demand shall be excused
only when the plaintiff makes a specific showing that irreparable injury to the
Trust would otherwise result, or if a majority of the Board of Trustees, or a
majority of any committee established to consider the merits of such action, has
a material personal financial interest in the action at issue. A Trustee shall
not be deemed to have a personal financial interest in an action or otherwise be
disqualified from ruling on a Shareholder demand by virtue of the fact that such
Trustee receives remuneration from his or her service on the Board of Trustees
of the Trust or on the boards of one or more investment companies with the same
or an affiliated investment adviser or underwriter, or the amount of such
remuneration.]]
[[Such demand shall be mailed to the Secretary or Clerk of the Trust at
the Trust's principal office and shall set forth in reasonable detail the nature
of the proposed court action, proceeding or claim and the essential facts relied
upon by the Shareholder to support the allegations made in the demand. The
Trustees shall consider such demand within 45 days of its receipt by the Trust.
In their sole discretion, the Trustees may submit the matter to a vote of
Shareholders of the Trust, as appropriate. Any decision by the Trustees to
bring, maintain or settle (or not to bring, maintain or settle) such court
action, proceeding or claim, or to submit the matter to a vote of Shareholders,
shall be made by the Trustees in their business judgment and shall be binding
upon the Shareholders. Any decision by the Trustees to bring or maintain a court
action, proceeding or suit on behalf of the Trust shall be subject to the right
of the Shareholders under Section 6.8 of the Declaration to vote on whether or
not such court action, proceeding or suit should or should not be brought or
maintained.]]
ARTICLE VI
SHARES OF BENEFICIAL INTEREST
-----------------------------
Section 6.1. Beneficial Interest. The interest of the beneficiaries
hereunder [shall] [[may]] be divided into transferable [shares of beneficial
interest, all of one class, without par value. The number of shares of
beneficial interest] [[Shares of Beneficial Interest (without par value). 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
[specifically set forth]. The Shares shall not entitle the holder to preference,
preemptive, appraisal, conversion or exchange rights.[[ By becoming a
Shareholder each Shareholder shall be held expressly to have assented to and
agreed to be bound by the provisions of the Declaration.]]
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 into a greater or lesser number without thereby changing their
proportionate beneficial interests in Trust [[Property]]. Contributions to the
Trust may be accepted for whole Shares and/or 1/1,000ths of a Share or integral
multiples thereof.
Section 6.5. Register of Shares. A register [[or registers]] 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 [[(which may be addresses for
electronic delivery)]] 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 ][[that
Shareholder as provided]] herein or in the By-Laws [provided], until [he] [[the
Shareholder]] has given his [[or her]] address to the Transfer Agent or such
other officer or agent of the Trustees as shall keep the said register for entry
thereon. The Trustees, in their discretion, may authorize the issuance of Share
certificates and promulgate appropriate rules and regulations as to their use.
Section 6.6. Transfer of Shares. Shares shall be transferable on the
records of the Trust only by the record holder thereof or by [his] [[the record
holder's]] agent thereunto [duly] authorized in writing, upon delivery to the
Trustees or[[, if there is a Transfer Agent with respect to such Shares,]] the
Transfer Agent of a duly executed instrument of transfer[,] together with any
certificate [of] [[or]] certificates (if issued) for such Shares and such
evidence of the [genuiness] [[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 [register] [[registrar]] nor any officer, employee or agent of the
Trust shall be affected by any notice of the proposed transfer.
Any [person] [[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
[[(i)]] if mailed, postage prepaid, addressed to any Shareholder of record at
[his] [[the Shareholder's]] last known address as recorded on the register of
the Trust[[, (ii) if sent by electronic transmission to the Shareholder of
record at the Shareholder's last known address for electronic delivery as
recorded on the register of the Trust, (iii) if mailed or sent by electronic
delivery to one or more members of the Shareholder's household in accordance
with applicable law or regulation, or (iv) if otherwise sent in accordance with
applicable law or regulation]].
Section 6.8. Voting Powers. The Shareholders shall have power to vote
only (i) for the election of Trustees [or for their removal ][[when that issue
is submitted to Shareholders, and 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] [[on which a shareholder vote is
required by the 1940 Act]], (iii) with respect to termination of the Trust [[to
the extent and]] as provided in Section 8.2 [[hereof]], (iv) with respect to any
amendment of the Declaration to the extent and as provided in Section 8.3
[[hereof]], (v) with respect to any merger, consolidation, [conversion] or sale
of assets [[to the extent and]] as provided in Sections 8.4[, 8.5] and 8.7
[[hereof]], (vi) with respect to [incorporation] [[any conversion]] of the Trust
[[to an "open-end company"]] to the extent and as provided in Section [8.5]
[[8.6 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] [[other regulator having jurisdiction over the
Trust]], 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]
[[A Shareholder shall be entitled to one vote for each Share owned by
such Shareholder on each matter on which such Shareholder]] 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.
[[Except when a larger vote is required by applicable law or by any
provision of the Declaration or the By-Laws, if any, Shares representing a
majority of the Shares voted in person or by proxy shall decide any questions
and a plurality shall elect a Trustee, provided that abstentions and broker
non-votes shall not be counted as votes cast but shall be counted as being
present for purposes of determining the existence of a quorum.]]
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 [Shareholders'] [[Shareholder]] votes
and meetings and related matters.
ARTICLE VII
DETERMINATION OF NET ASSET VALUE,
---------------------------------
NET INCOME AND DISTRIBUTIONS
----------------------------
The Trustees, in their absolute discretion, may prescribe and shall set
forth in the By-[Laws] [[laws]] or in a duly adopted vote of the Trustees such
bases and times for determining the per Share net asset value of the Shares or
net income, or the declaration and payment of dividends and distributions, as
they may deem necessary or desirable.
ARTICLE VIII
DURATION; TERMINATION OF TRUST;
-------------------------------
AMENDMENT; MERGERS, ETC.
------------------------
Section 8.1. Duration. The Trust shall continue without limitation of
time but subject to the provisions of this Article VIII.
Section 8.2. Termination of Trust. (a) The Trust may be terminated [[at
any time]] (i) by the affirmative vote of the holders of not less than
two-thirds of the Shares outstanding and entitled to vote at any meeting of
Shareholders, or (ii) by [an instrument in writing, without a meeting, signed by
a majority of the Trustees and consented to by the holders of not less than
two-thirds of such Shares] [[the Trustees by written notice to the
Shareholders]]. Upon the termination of the Trust:
(i) The Trust shall carry on no business except for the purpose of
winding up its affairs;
(ii) The Trustees shall proceed to wind up the affairs of the Trust and
all the powers of the Trustees under [this] [[the]] Declaration shall continue
until the affairs of the Trust shall have been wound up, including the power to
fulfill or discharge the contracts of the Trust, collect its assets, sell,
convey, assign, exchange, transfer or otherwise dispose of all or any part of
the remaining Trust Property to one or more [persons] [[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]
[[and]] [sale, conveyance, assignment, exchange, transfer or other disposition
of all or substantially all the Trust Property shall require Shareholder
approval in accordance with Section 8.4 hereof; and]
(iii) After paying or adequately providing for the payment of all
liabilities, and upon receipt of such releases, indemnities and refunding
agreements as they deem necessary for their protection, the Trustees may
distribute the remaining Trust Property, in cash or in kind or partly in cash
and partly in kind, among the Shareholders [[of the Trust]] according to their
respective rights.
(b) After termination of the Trust and distribution to the Shareholders
[[of the Trust]] 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]],
and the rights and interests of all Shareholders [[of the Trust]] shall
thereupon cease.
Section 8.3. Amendment Procedure. (a) Except as [provided in paragraph
(c) of this Section 8.3 this Declaration may be amended by a Majority
Shareholder Vote or by an instrument in writing, without a meeting, signed by a
majority of the Trustees and consented to by the holders of not less than a
majority of the Shares outstanding and entitled to vote. The Trustees may also
amend this Declaration without the vote or consent of Shareholders to change the
name ][[specifically provided herein, the Trustees may, without any Shareholder
vote, amend or otherwise supplement the Declaration by making an amendment, a
Declaration of Trust supplemental hereto or an amended and restated Declaration.
Without limiting the foregoing power reserved to the Trustees, the Trustees may,
without any Shareholder vote, amend the Declaration to change the name or
principal office]] of the Trust, to supply any omission, to cure, correct or
supplement any ambiguous, defective or inconsistent provision hereof, or if they
deem it necessary [to conform this] [[or advisable, to conform the]] Declaration
to the requirements of applicable [federal laws or regulations or the
requirements of the regulated investment company provisions of] [[law, including
the 1940 Act and]] the Internal Revenue Code [[of 1986, as amended]], but the
Trustees shall not be liable for failing [so to do.] [[to do so. Shareholders
shall have the right to vote on (i) any amendment that would affect their right
to vote granted in Section 6.8; (ii) any amendment to this Section 8.3(a); (iii)
any amendment as may be required by law or by the Trust's registration statement
to be approved by Shareholders; and (iv) any amendment submitted to them by the
Trustees. Except as otherwise provided in Section 8.3(c), any amendment on which
Shareholders have the right to vote shall require a Majority Shareholder Vote of
the Shareholders of the Trust, or the written consent, without a meeting, of the
holders of Shares representing not less than a majority of the voting power of
the Shares of the Trust.]]
[(b) No amendment may be made under this Section 8.3 which would change any
rights with respect to any Shares by reducing the amount payable thereon upon
liquidation of the Trust or by diminishing or eliminating any voting rights
pertaining thereto, except with the vote or consent of the holders of two-thirds
of the Shares outstanding and entitled to vote.]
[[(b)]] Nothing contained in [this] [[the]] Declaration shall permit
the amendment of [this] [[the]] Declaration to impair the exemption from
personal liability of the Shareholders, [Trustees, Officers,] [[former
Shareholders, Trustees, Trustees Emeritus, officers,]] employees and agents of
the Trust or to permit [assessment upon Shareholders.] [[assessments upon
Shareholders or former Shareholders. Notwithstanding anything else herein, any
amendment to Section 5.3 shall not limit the rights to indemnification or
insurance provided therein with respect to actions or omissions of persons
entitled to indemnification under such Section prior to such amendment.]]
(c) No amendment may be made [under this Section 8.3] which shall
amend, alter[,] change or repeal any of the provisions of [Sections 8.3, 8.4,
8.6 and] [[Section 2.2, Section 8.2, this Section 8.3(c), Section 8.4, Section
8.6 and Section]] 8.7 unless the amendment effecting such amendment, alteration,
change or repeal shall receive the affirmative vote or consent of sixty-six and
two-thirds percent (66 2/3%) of the Shares outstanding and entitled to vote.
Such affirmative vote or consent shall be in addition to the vote or consent of
the holders of Shares otherwise required by law or by the terms of any class or
series of preferred stock, whether now or hereafter authorized, or any agreement
between the Trust and any national securities exchange.
(d) A certificate signed by a majority of the Trustees setting forth an
amendment and reciting that it was duly adopted by the Shareholders [[(if
applicable)]] or by the Trustees as aforesaid or a copy of the Declaration, as
amended, and executed by a majority of the Trustees, shall be conclusive
evidence of such amendment when lodged among the records of the Trust.
[Notwithstanding any other provision hereof, until such time as a Registration
Statement under the Securities Act of 1933, as amended, covering the first
public offering of securities of the Trust shall have become effective, this
Declaration may be terminated or amended in any respect by the affirmative vote
of a majority of the Trustees or by an instrument signed by a majority of the
Trustees.]
Section 8.4. Merger, Consolidation and Sale of Assets. [The] [[Subject
to applicable law and except as otherwise provided in Section 8.5 hereof, 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 [[(a)]] at any meeting of
Shareholders called for the purpose by the affirmative vote of the holders of
not less than two-thirds of the Shares outstanding and entitled to vote, or [by
an instrument or instruments in writing][[(b) by the written consent,]] without
a meeting, [consented to by] [[of]] the holders of not less than two-thirds of
such Shares, provided, however, that if such merger, consolidation, sale, lease
or exchange is recommended by the Trustees, the vote or written consent of the
holders of a majority of Shares outstanding and entitled to vote, shall be
sufficient authorization[; and any][[. 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] [[The]] Commonwealth of
Massachusetts. [[Such transactions may be effected through share-for-share
exchanges, transfers or sales of assets, in-kind redemptions and purchases,
exchange offers, or any other method approved by the Trustees.]] Nothing
contained herein shall be construed as requiring approval of [shareholder]
[[Shareholders]] for any sale of assets in the ordinary course of [[the]]
business of the Trust[[, or for any transaction, whether deemed a merger,
consolidation, reorganization or exchange of shares or otherwise, whereby the
Trust issues shares in connection with the acquisition of assets (including
those subject to liabilities) from any other investment company or similar
entity]].
Section 8.5. Incorporation [and Reorganization. With the approval of
the holders of a majority of the Shares outstanding and entitled to vote, the
Trustees may][[, Reorganization]][[. The Trustees may, without the vote or
consent of Shareholders,]] cause to be organized or assist in organizing a
corporation or corporations under the laws of any jurisdiction, or any other
trust [[(or series or class of a trust), unit investment trust]], partnership,
[[limited liability company,]] association or other organization to [take over]
[[acquire]] all [[or a portion]] 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] [[such]] Trust Property to any such
corporation, trust [[(or series or class of a trust)]], partnership, [[limited
liability company,]] association or organization in exchange for the shares or
securities thereof or otherwise[[,]] and to lend money to, subscribe for the
shares or securities of, and enter into any contracts with any such corporation,
trust, partnership, association or organization in which the Trust holds or is
about to acquire shares or any other interest. [Subject to section 8.4 hereof,
the] [[The]] Trustees may also[[, without the vote or consent of Shareholders,]]
cause a merger or consolidation between the Trust or any successor thereto and
any such corporation, trust [[(or series or class of a trust)]], partnership,
association or other organization if and to the extent permitted by law [as
provided under the law then in effect. Nothing contained herein shall be
construed as requiring approval of Shareholders for the Trustees to organize or
assist in organizing one or more corporations, trusts, partnerships,
associations or other organizations and selling, conveying or transferring a
portion of the Trust Property to such organization or entities.][[. The Trustees
shall provide written notice to affected Shareholders of each transaction
pursuant to this Section 8.5. Such transactions may be effected through
share-for-share exchanges, transfers or sales of assets, in-kind redemptions and
purchases, exchange offers, or any other method approved by the Trustees.]]
Section 8.6. Conversion. Notwithstanding any other provision of this
Declaration, the conversion of the Trust from a "closed-end company" to an
"open-end company," as those terms are defined in [Sections 5(a)(2) and 5(a)(1),
respectively, of] the 1940 Act [as in effect on December 1, 1986], shall require
the affirmative vote or consent of the holders of sixty-six and two-thirds
percent (66 2/3%) of the Shares outstanding and entitled to vote. Such
affirmative vote or consent shall be in addition to the vote or consent of the
holders of the Shares otherwise required by law or by the terms of any class or
series of preferred stock, whether now or hereafter authorized, or any agreement
between the Trust and any national securities exchange.
Section 8.7. Certain Transactions. (a) Notwithstanding any other
provision of this Declaration and subject to the exceptions provided in
paragraph (d) of this Section, the types of transactions described in paragraph
(c) of this Section shall require the affirmative vote or consent of the holders
of sixty-six and two-thirds [[percent]] (66 2/3%) of the Shares outstanding and
entitled to vote, when a Principal Shareholder (as defined in paragraph (b) of
this Section) is a party to the transaction. Such affirmative vote or consent
shall be in addition to the vote or consent of the [holders of Shares]
[[Shareholders]] otherwise required by law or by the terms of any class or
series of preferred stock, whether now or hereafter authorized, or any agreement
between the Trust and any national securities exchange.
(b) The term "Principal Shareholder" shall mean any corporation, person
or other entity which is the beneficial owner, directly or [directly]
[[indirectly, ]]of more than five percent (5%) of the outstanding Shares and
shall include any affiliate or associate, as such terms are defined in clause
(ii) below, of a Principal Shareholder. For the purposes of this Section, in
addition to the Shares which a corporation, person or other entity beneficially
owns directly, (a) any corporation, person or other entity shall be deemed to be
the beneficial owner of any Shares (i) which it has the right to acquire
pursuant to any agreement or upon exercise of conversion rights or warrants, or
otherwise (but excluding share options granted by the Trust) or (ii) which are
beneficially owned, directly or indirectly (including Shares deemed owned
through application of clause (i) above), by any other corporation, person or
entity with which its "affiliate" or "associate" (as defined below) has any
agreement, arrangement or understanding for the purpose of acquiring, holding,
voting or disposing of Shares, or which is its "affiliate"[,] or "associate" as
those terms are defined in Rule 12b-2 of the General Rules and Regulations under
the Securities Exchange Act of 1934 as in effect on December 1, 1986, and (b)
the outstanding Shares shall include Shares deemed owned through application of
clauses (i) and (ii) above but shall not include any other [Shares] [[shares]]
which may be issuable pursuant to any agreement, or upon exercise of conversion
rights or warrants, or otherwise.
(c) This Section shall apply to the following transactions:
(i) [The] [[the]] merger or consolidation of the Trust or any
subsidiary of the Trust with or into any Principal Shareholder[[;]]
(ii) [The] [[the]] issuance of any securities of the Trust to any
Principal Shareholder for cash[[;]]
(iii) [The] [[the]] sale, lease or exchange of all or any substantial
part of the assets of the Trust to any Principal Shareholder (except assets
having an aggregate fair market value of less than $1,000,000, aggregating for
the purpose of such computation all assets sold, leased or exchanged in any
series of similar transactions within a twelve-month [period.)] [[period);]]
(iv) [The] [[the]] sale, lease or exchange to the Trust or any
subsidiary thereof, in exchange for securities of the Trust of any assets of any
Principal Shareholder (except assets having an aggregate fair market value of
less than $1,000,000, aggregating for the purposes of such computation all
assets sold, leased or exchanged in any series of similar transactions within a
twelve-month period).
(d) The provisions of this Section shall not be applicable to (i) any
of the transactions described in paragraph (c) of this Section if the Board of
Trustees of the Trust shall by resolution have approved a memorandum of
understanding with such Principal Shareholder with respect to and substantially
consistent with such transaction, or (ii) any such transaction with any
corporation of which a majority of the outstanding shares of all classes of
stock normally entitled to vote in elections of directors is owned of record or
beneficially by the Trust and its subsidiaries.
(e) The Board of Trustees shall have the power and duty to determine
for the purposes of this Section on the basis of information known to the Trust,
whether (i) a corporation, person or entity beneficially owns more than five
percent (5%) of the outstanding Shares, (ii) a corporation, person or entity is
an "affiliate" or "associate" (as defined above) of another, (iii) the assets
being acquired or leased to or by the Trust or any subsidiary thereof,
constitute a substantial part of the assets of the Trust and have an aggregate
fair market value of less than $1,000,000, and (iv) the memorandum of
understanding referred to in paragraph (d) hereof is substantially consistent
with the transaction covered thereby. Any such determination shall be conclusive
and binding for all purposes of this Section.
ARTICLE IX
[REPORTS TO SHAREHOLDERS]
[The Trustees shall at least semi-annually submit to the Shareholders a written
financial report of the transactions of the Trust, including financial
statements which shall at least annually be certified by independent public
accountants.]
[ARTICLE X]
MISCELLANEOUS
-------------
Section [10.1.] [[9.1.]] Filing. [This] [[The]] Declaration and any
[[subsequent]] amendment hereto shall be filed in the office of the Secretary of
[the] [[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[[, provided that the failure to so file shall not
invalidate this instrument or any properly authorized amendment hereto]]. Each
amendment so filed shall be accompanied by a certificate signed and acknowledged
by [a] [[an officer or]] Trustee stating that such action was duly taken in a
manner provided herein, and unless such amendment or such certificate sets forth
some [later] [[other]] 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]
[[The]] Commonwealth of Massachusetts, be conclusive evidence of all amendments
contained therein and may thereafter be referred to in lieu of the original
Declaration and the various amendments thereto.
Section [10.2] [[9.2]]. Governing Law. [This] [[The]] Declaration is
executed by the Trustees and delivered in [the] [[The]] Commonwealth of
Massachusetts and with reference to the laws thereof, and the rights of all
parties and the validity and construction of every provision hereof shall be
subject to and construed according to the laws of said [State.] [[Commonwealth.
The Trust shall be of the type commonly called a Massachusetts business trust,
and without limiting the provisions hereof, the Trust may exercise all powers
which are ordinarily exercised by such a trust, and the absence of a specific
reference herein to any such power, privilege, or action shall not imply that
the Trust may not exercise such power or privilege or take such action.]]
[Section 10.3. Counterparts. This]
[[Section 9.3. Principal Office. The principal office of the Trust is
500 Boylston Street, Boston, Massachusetts. The Trustees, without a vote of
Shareholders, may change the principal office of the Trust.]]
[[Section 9.4. Counterparts. The]] 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 [10.4] [[9.5]]. Reliance by Third Parties. Any certificate
executed by an individual who, according to the records of the Trust[[,]]
appears to be [a] [[an officer or]] Trustee hereunder, certifying to:
[(a)][[(i)]] the number or identity of Trustees or Shareholders, [(b)][[(ii)]]
the due authorization of the execution of any instrument or writing,
[(c)][[(iii)]] the form of any vote passed at a meeting of Trustees or
Shareholders, [(d)][[(iv)]] the fact that the number of Trustees or Shareholders
present at any meeting or executing any written instrument satisfies the
requirements of [this] [[the]] Declaration, [(e)][[(v)]] the form of any By-Laws
adopted by or the identity of any officers elected by the Trustees, or
[(f)][[(vi)]] the existence of any fact or facts which in any manner [relate]
[[relates]] 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 9.6. Provisions in Conflict with Law or Regulations.]]
[Section 10.5. Provisions in Conflict with Law or Regulations.]
(a) The provisions of the Declaration are severable, and if the
Trustees shall determine, with the advice of counsel, that any of such
provisions is in conflict with the 1940 Act, the regulated investment company
[[or other]] 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
9th day of January, 1987.] [[as of the ________ day of_______, ________.]]
[[[Trustee Signature Lines]]]
APPENDIX C
FUNDAMENTAL POLICIES TO APPLY TO
THE FUND UPON SHAREHOLDER APPROVAL
The Fund may not:
(1) Borrow Money: borrow money except to the extent such borrowing is not
prohibited by the 1940 Act and exemptive orders granted under such Act.
(2) Underwrite Securities: underwrite securities issued by other persons,
except that all or any portion of the assets of the Fund may be
invested in one or more investment companies, to the extent not
prohibited by the 1940 Act and exemptive orders granted under such Act,
and except insofar as the Fund may technically be deemed an underwriter
under the Securities Act of 1933, as amended, in selling a portfolio
security.
(3) Senior Securities: issue any senior securities except to the extent not
prohibited by the 1940 Act and exemptive orders granted under such Act.
For purposes of this restriction, collateral arrangements with respect
to any type of swap, option, Forward Contracts and Futures Contracts
and collateral arrangements with respect to initial and variation
margin are not deemed to be the issuance of a senior security.
(4) Make Loans: make loans except to the extent not prohibited by the 1940
Act and exemptive orders granted under such Act.
(5) Real Estate, Oil and Gas, Mineral Interests, Commodities: purchase or
sell real estate (excluding securities secured by real estate or
interests therein and securities of companies, such as real estate
investment trusts, which deal in real estate or interests therein),
interests in oil, gas or mineral leases, commodities or commodity
contracts (excluding currencies and any type of option, Futures
Contracts and Forward Contracts) in the ordinary course of its
business. The Fund reserves the freedom of action to hold and to sell
real estate, mineral leases, commodities or commodity contracts
(including currencies and any type of option, Futures Contracts and
Forward Contracts) acquired as a result of the ownership of securities.
(6) Industry Concentration: purchase any securities of an issuer in a
particular industry if as a result 25% or more of its total assets
(taken at market value at the time of purchase) would be invested in
securities of issuers whose principal business activities are in the
same industry, except that the Fund may invest up to 40% of the value
of its assets in each of the electric utility and telephone industries.
APPENDIX D
CURRENT FUNDAMENTAL INVESTMENT POLICIES AND
PROPOSED ACTION TO BE TAKEN
--------------------------------------------------------------------------------
PROPOSED NEW POLICY OR
CURRENT FUNDAMENTAL POLICY PROPOSED REMOVAL OF POLICY
--------------------------------------------------------------------------------
The Fund may not: The Fund may not:
--------------------------------------------------------------------------------
(1) borrow money or pledge, mortgage Borrow Money: borrow money except to
or hypothecate its assets, except (i) the extent such borrowing is not
as a temporary measure for prohibited by the 1940 Act and
extraordinary or emergency purposes, exemptive orders granted under such
(ii) for a repurchase of its shares, Act.
or (iii) for investment in accordance
with its investment objective and
policies, and in no event shall the
Fund borrow in excess of 1/3 of its
assets;
--------------------------------------------------------------------------------
(2) purchase any security or evidence It is proposed that this fundamental
of interest therein on margin, except policy be removed.
that the Fund may obtain such
short-term credit as may be necessary
for the clearance of purchases and
sales of securities and except that
the Fund may make deposits on margin
in connection with Futures Contracts
and options;
--------------------------------------------------------------------------------
(3) underwrite securities issued by Underwrite Securities: underwrite
other persons except insofar as the securities issued by other persons,
Fund may technically be deemed an except that all or any portion of the
underwriter under the Securities Act assets of the Fund may be invested in
of 1933 in selling a portfolio one or more investment companies, to
security; the extent not prohibited by the 1940
Act and exemptive orders granted under
such Act, and except insofar as the
Fund may technically be deemed an
underwriter under the Securities Act
of 1933, as amended, in selling a
portfolio security.
--------------------------------------------------------------------------------
(4) purchase or sell real estate Real Estate, Oil and Gas, Mineral
(including limited partnership Interests, Commodities: purchase or
interests but excluding securities sell real estate (excluding securities
secured by real estate or interests secured by real estate or investment
therein), interests in oil, gas or trusts, which deal in real estate or
mineral leases, commodities or interests therein), contracts
commodity contracts (except contracts (excluding currencies and any type of
interests therein and securities of option, Futures Contracts and Forward
companies, such as real estate for the Contracts) in the ordinary course of
future acquisition or delivery of its business. The Fund reserves the
fixed income securities) in the freedom of action to hold and to sell
ordinary course of the business of the real estate, mineral leases,
Fund (the Fund reserves the freedom of commodities or commodity contracts
action to hold interests in oil, gas (including currencies and any type of
or mineral leases, commodities or option, Futures Contracts and Forward
commodity and to sell real estate Contracts) acquired as a result of the
acquired as a result of the ownership ownership of securities.
of securities);
--------------------------------------------------------------------------------
(5) purchase securities of any issuer It is proposed that this fundamental
if such purchase at the time thereof policy be removed.
would cause more than 10% of the
voting securities of such issuer to be
held by the Fund;
--------------------------------------------------------------------------------
(6) issue any senior security (as that Senior Securities: issue any senior
term is defined in the Investment securities except to the extent not
Company Act of 1940 (the "1940 Act"), prohibited by the 1940 Act and
if such issuance is specifically exemptive orders granted under such
prohibited by the 1940 Act or the Act. For purposes of this restriction,
rules and regulations promulgated collateral arrangements with respect
thereunder (for the purposes of this to any type of swap, option, Forward
restriction, collateral arrangements Contracts and Futures Contracts and
with respect to options, Futures collateral arrangements with respect
Contracts and Options on Futures to initial and variation margin are
Contracts and collateral arrangements not deemed to be the issuance of a
with respect to initial and variation senior security.
margin are not deemed to be the
issuance of a senior security);
--------------------------------------------------------------------------------
(7) make loans to other persons except Make Loans: make loans except to the
through the lending of its portfolio extent not prohibited by the 1940 Act
securities not in excess of 30% of its and exemptive orders granted under
total assets (taken at market value) such Act.
and except through the use of
repurchase agreements, the purchase of
commercial paper or the purchase of
all or a portion of an issue of debt
securities in accordance with its
investment objective, policies and
restrictions;
--------------------------------------------------------------------------------
(8) make short sales of securities or It is proposed that this fundamental
maintain a short position, unless at policy be removed.
all times when a short position is
open it owns an equal amount of such
securities or securities convertible
into or exchangeable, without payment
of any further consideration, for
securities of the same issue as, and
equal in amount to, the securities
sold short ("short sales against the
box"), and unless not more than 10% of
the Fund's net assets (take at market
value) is held as collateral for such
sales at any one time;
--------------------------------------------------------------------------------
(9) invest more than 25% of the value Industry Concentration: purchase any
of its total assets in any industry, securities of an issuer in a
except as described under the particular industry if as a result 25%
subsection "Corporate Fixed Income or more of its total assets (taken at
Securities" of the section "Investment market value at the time of purchase)
Objective and Policies" above.* would be invested in securities of
issuers whose principal business
activities are in the same industry,
except that the Fund may invest up to
40% of the value of its assets in each
of the electric utility and telephone
industries.
--------------------------------------------------------------------------------
*This investment policy refers to a section in the Fund's currently effective
Registration Statement.
APPENDIX E
NOTE: THIS APPENDIX CONTAINS A COMPARISON BETWEEN THE CURRENT AGREEMENT AND THE
STANDARDIZED NEW AGREEMENT THAT THE TRUSTEES PROPOSE TO USE FOR ALL OF THE FUNDS
WITHIN THE MFS FAMILY OF FUNDS. THIS AGREEMENT HAS BEEN MARKED TO SHOW THE
CHANGES THAT WILL BE MADE IF THE NEW AGREEMENT PROPOSED IN ITEM 4 IS APPROVED
AND ADOPTED. DELETED TEXT IS MARKED THROUGH AND ADDED TEXT APPEARS IN
ITALICS. FOR EDGAR DELETED TEXT IS SET IN BRACKETS AND ADDED TEXT IS SET IN
DOUBLE BRACKETS.
INVESTMENT ADVISORY AGREEMENT
INVESTMENT ADVISORY AGREEMENT, dated this [25th] [[____]] day of
[February, 1987] _________[[, _____]], by and between MFS MULTIMARKET INCOME
TRUST, a Massachusetts business trust (the ["Trust"] [["Fund"]])[[,]] and
MASSACHUSETTS FINANCIAL SERVICES COMPANY, a Delaware corporation (the
"Adviser").
WITNESSETH:
WHEREAS, the [Trust] [[Fund ]]is engaged in business as [a closed-end]
[[an]] investment company registered under the Investment Company Act of 1940;
and
WHEREAS, the Adviser is willing to provide [business management]
services to the [Trust (the "Fund")] [[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. [[(a)]] The Adviser shall provide
the Fund with such investment advice and supervision as the latter may from time
to time consider necessary for the proper supervision of its [funds] [[assets]].
The Adviser shall act as [Adviser] [[investment adviser]] to the Fund and as
such shall furnish continuously an investment program and shall determine from
time to time what securities [[or other instruments]] shall be purchased, sold
or exchanged and what portion of the assets of the Fund shall be held
uninvested, subject always to the restrictions of [its] [[the Fund's Amended and
Restated]] Declaration of Trust, dated [January 9, 1987][[_____________]], and
By-Laws, [as] each [may be] [[as]] amended from time to time (respectively, the
"Declaration" and the "By-Laws"), to the provisions of the Investment Company
Act of 1940 and the Rules, Regulations and orders thereunder and to the Fund's
then[[-]]current Prospectus [[and Statement of Additional Information]]. The
Adviser [[also]] shall [also make recommendations as to the manner in which]
[[exercise ]]voting rights, rights to consent to corporate [action] [[actions]]
and any other rights pertaining to the Fund's portfolio securities [shall be
exercised] [[in accordance with the Adviser's policies and procedures as
presented to the Trustees of the Fund from time to time]]. Should the Trustees
at any time, however, make any definite determination as to the 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] [[shall be]] revoked.
[[(b)]] The Adviser shall take, on behalf of the Fund, all actions
which it deems necessary to implement the investment policies determined as
provided above, and in particular to place all orders for the purchase or sale
of portfolio securities [[or other instruments]] for the Fund's account with
brokers or dealers selected by it, and to that end[[,]] the Adviser is
authorized as [[the]] agent of the Fund to give instructions to the Custodian of
the Fund as to [[the]] deliveries of securities [[or other instruments]] and
payments of cash for the account of the Fund. In connection with the selection
of such brokers or dealers and the placing of such orders, the Adviser is
directed to seek for the Fund[ execution at the best available price. Subject to
this requirement of seeking the best available price, securities may be bought
from or sold to broker dealers who have furnished statistical, research and
other information or services to the Adviser.] [[the best overall price and
execution available from responsible brokerage firms, taking account of all
factors it deems relevant, including by way of illustration: price; the size of
the transaction; the nature of the market for the security; the amount of the
commission; the timing and impact of the transaction taking into account market
prices and trends; the reputation, experience and financial stability of the
broker or dealer involved; and the quality of services rendered by the broker or
dealer in other transactions. 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 the Fund to
pay a broker or dealer an amount of commission for effecting a securities
transaction in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction, if the Adviser determined in good
faith that such amount of commission was reasonable in relation to the value of
the brokerage and research services provided by such broker or dealer, viewed in
terms of either that particular transaction or the Adviser's overall
responsibilities with respect to the Fund and to other clients of the Adviser as
to which the Adviser exercises investment discretion. Subject to seeking the
best price and execution as described above, and in accordance with applicable
rules and regulations, the Adviser also is authorized to consider sales of
shares of the Fund or of other funds or accounts of the Adviser as a factor in
the selection of brokers and dealers.]]
[[(c) The Adviser may from time to time enter into sub-investment
advisory agreements with respect to the Fund with one or more investment
advisers with such terms and conditions as the Adviser may determine, provided
that such sub-investment advisory agreements have been approved in accordance
with applicable provisions of the Investment Company Act of 1940 and any rules,
regulations or orders of the Securities and Exchange Commission thereunder.
Subject to the provisions of Article 6, the Adviser shall not be liable for any
error of judgment or mistake of law by any sub-adviser or for any loss arising
out of any investment made by any sub-adviser or for any act or omission in the
execution and management of the Fund by any sub-adviser.]]
[[ARTICLE]] 2. ALLOCATION OF CHARGES AND EXPENSES. [[(a)]] The Adviser
shall furnish at its own expense investment advisory and administrative
services, office space, equipment and clerical personnel necessary for servicing
the investments of the Fund and maintaining its organization, and investment
advisory facilities and executive and supervisory personnel for managing the
investments[,] [[and]] effecting the portfolio transactions of the Fund. The
Adviser shall arrange, if desired by the Fund, for directors, officers and
employees of the Adviser to serve as Trustees, officers or agents of the Fund if
duly elected or appointed to such positions and subject to their individual
consent and to any limitations imposed by law.
(b) It is understood that the Fund will pay all of its own expenses
[[incurred in its operations and in the offering of the Fund's shares, unless
specifically provided otherwise in this Agreement, or except to the extent that
the Adviser agrees in a written instrument executed by the Adviser (specifically
referring to this Article 2(b)) to assume or otherwise pay for specified
expenses of the Fund,]] including, without limitation[,][[:]] compensation of
Trustees [not "][["not]] affiliated" with the Adviser; governmental fees;
interest charges; taxes; membership dues in the Investment Company Institute
allocable to the Fund; fees and expenses of independent auditors, of legal
counsel[[,]] and of any transfer agent, registrar or dividend disbursing agent
of the Fund; expenses of [[repurchasing and redeeming shares and]] servicing
shareholder accounts; expenses of preparing, printing and mailing [share]
[[stock]] certificates, shareholder reports, notices, proxy statements and
reports to governmental officers and commissions; brokerage and other expenses
connected with the execution, recording and settlement of portfolio security
transactions; insurance premiums; fees and expenses [at] [[of]] the custodian
for all services to the Fund, including safekeeping of funds and securities [;]
and maintaining required books and accounts; expenses of calculating the net
asset value of shares of the Fund; [expenses of shareholder meetings,]
[[organizational and start up costs; such non-recurring or extraordinary
expenses as may arise, including those relating to actions, suits or proceedings
to which the Fund is a party or otherwise may have an exposure, and the legal
obligation which the Fund may have to indemnify the Fund's Trustees and officers
with respect thereto;]] and expenses relating to the issuance, registration and
qualification of shares of the [Trust] [[Fund]] and the preparation, printing
and mailing of prospectuses for such purposes (except to the extent that any
Distribution Agreement to which the Fund is a party provides that another party
is to pay some or all of such expenses).
[[(c) The payment or assumption by the Adviser of any expenses of the
Fund that the Adviser is not obligated by this Agreement or otherwise to pay or
assume shall not obligate the Adviser to pay or assume the same or any similar
expenses of the Fund on any subsequent occasion.]]
[[ARTICLE]] 3. COMPENSATION OF THE ADVISER. For the services to be
rendered and the facilities [to be] provided, the [Trust] [[Fund]] shall pay to
the Adviser [out of the assets of the Fund] an investment advisory fee computed
and paid monthly in an amount equal to the sum of 0.34% of the Fund's average
daily net assets plus 5.4% of the Fund's gross income (i.e., income other than
gains from the sale of securities, short-term gains from options and futures
transactions and premium income from options written), in each case on an annual
basis for the Fund's then-current fiscal year. If the Adviser shall serve for
less than the whole of any period specified in this Article 3, the compensation
[[paid]] to the Adviser will be prorated.
[[ARTICLE 4. ADDITIONAL SERVICES. Should the Fund have occasion
to request the Adviser or its affiliates to perform administrative or other
additional services not herein contemplated or to request the Adviser or its
affiliates to arrange for the services of others, the Adviser or its affiliates
will act for the Fund upon request to the best of its ability, with compensation
for the services to be agreed upon with respect to each such occasion as it
arises. No such agreement for additional services shall expand, reduce or
otherwise alter the obligations of the Adviser, or the compensation that the
Adviser is due, under this Agreement.]]
[[ARTICLE 5]] [4]. COVENANTS OF THE ADVISER. The Adviser agrees that it
will not deal with itself, or with the Trustees of the Fund or the [Fund
principal underwriter] [[Fund's distributor]], if any, as principals in making
purchases or sales of securities or other property for the account of the Fund,
except as permitted by the Investment Company Act of 1940 and [the Rules,
Regulations or Orders] [[any rules, regulations or orders of the Securities and
Exchange Commission]] thereunder, will not take a long or short position in the
shares of the Fund except as permitted by [the Declaration] [[applicable law]],
and will comply with all other provisions of the Declaration and [[the]] By-Laws
and the then-current Prospectus [[and Statement of Additional Information ]]of
the Fund relative to the Adviser and its directors and officers.
[5]
[[ARTICLE 6]]. LIMITATION OF LIABILITY OF THE ADVISER. The Adviser
shall not be liable for any error of judgment or mistake of law or for any loss
arising out of any investment or for any act or omission in the execution and
management of the Fund, except for willful misfeasance, bad faith [or][[,]]
gross negligence [in the performance of its duties,] or [by reason of] reckless
disregard of its duties and obligations hereunder. As used in this [Section 5]
[[Article 6]], the term "Adviser" shall include directors, officers and
employees of the Adviser as well as [the] [[that]] corporation itself.
[6]
[[ARTICLE 7]]. ACTIVITIES OF THE ADVISER. [The ][[(a) The Fund
acknowledges that the]] services of the Adviser to the Fund are not [to be
deemed to be] exclusive, the Adviser being free to render investment advisory
and/or other services to others. The [Adviser may permit other Fund clients to
use the initials "MFS" in their names. The Fund agrees that if the Adviser shall
for any reason no longer serve as Adviser to the Fund, the Fund will change its
name so as to delete the initials "MFS".] [[Fund further acknowledges that it is
possible that, based on their investment objectives and policies, certain funds
or accounts managed by the Adviser or its affiliates may at times take
investment positions or engage in investment techniques which are contrary to
positions taken or techniques engaged in on behalf of the Fund. Notwithstanding
the foregoing, the Adviser will at all times endeavor to treat all of its
clients in a fair and equitable manner. ]]
[[(b) The Fund acknowledges that whenever the Fund and one or more
other funds or accounts advised by the Adviser have available monies for
investment, investments suitable and appropriate for each shall be allocated in
a manner believed by the Adviser to be fair and equitable to each entity.
Similarly, opportunities to sell securities or other investments shall be
allocated in a manner believed by the Adviser to be fair and equitable to each
entity. The Fund acknowledges that in some instances this may adversely affect
the size of the position that may be acquired or disposed of for the Fund. ]]
[[(c)]] It is understood that [[the]] Trustees, officers and
shareholders of the Fund are or may be or become interested in the Adviser, as
directors, officers, employees, or otherwise and that [directors, officers and
employees, or otherwise and that ]directors, officers and employees of the
Adviser are or may [be or] become similarly interested in the Fund, and that the
Adviser may be or become interested in the Fund as a shareholder or otherwise.
[[ARTICLE 8. MFS NAME. The Fund acknowledges that the names
"Massachusetts Financial Services," "MFS" or any derivatives thereof or logos
associated with those names (collectively, the "MFS Marks") are the valuable
property of the Adviser and its affiliates. The Adviser grants the Fund a
non-exclusive and non-transferable right and sub-license to use the MFS Marks
only so long as the Adviser serves as investment adviser to the Fund. The Fund
agrees that if the Adviser for any reason no longer serves as investment adviser
to the Fund, and the Adviser so requests, the Fund promptly shall cease to use
the MFS Marks and promptly shall amend its registration statement and
Declaration of Trust to delete any references to the MFS Marks. The Fund
acknowledges that the Adviser may permit other clients to use the MFS Marks in
their names or other material. For purposes of this Article, the Fund shall be
deemed to have taken the required action "promptly" if such action is taken
within 90 days of the Adviser no longer serving as the investment adviser to the
Fund, or from the date of the Adviser's request, as the case may be.]]
[[ARTICLE 9]] [7]. DURATION, TERMINATION AND [AMENDMENTS] [[AMENDMENT]]
OF THIS AGREEMENT. [[(a)]] This Agreement shall become effective [on the day and
year first above written and shall govern the relations between the parties
hereto thereafter, and shall remain in force until August 1, 1988] [[on the date
first written above. Thereafter, this Agreement will remain in effect for a
period of two years from the date first written above,]] on which date it will
terminate unless its continuance [after August 1, 1988] is "specifically
approved at least annually" (i) by the vote of a majority of the Trustees of the
Fund who are not "interested persons" of the Fund or of the Adviser at a meeting
specifically called for the purpose of voting on such approval, and (ii) by the
Board of Trustees of the Fund, or by "vote of a majority of the outstanding
voting securities" of the Fund.
[[(b)]] This Agreement may be terminated at any time without the
payment of any penalty by the Trustees or by "vote of a majority of the
outstanding voting securities" of the Fund, or by the Adviser, in each case on
not more than sixty days' nor less than thirty days' written notice to the other
party. This Agreement shall automatically terminate in the event of its
"assignment".
[[(c)]] This Agreement may be amended only if such amendment [[is in
writing signed by or on behalf of the Fund and the Adviser and ]]is approved by
"vote of a majority of the outstanding voting securities" of the Fund[[ (if such
shareholder approval is required by the Investment Company Act of 1940).]]
[[Article 10. Scope of Fund's Obligations. A COPY OF THE FUND'S
DECLARATIon of Trust is on file with the Secretary of State of The Commonwealth
of Massachusetts. The Adviser acknowledges that the obligations of or arising
out of this Agreement are not binding upon any of the Fund's Trustees, officers,
employees, agents or shareholders individually, but are binding solely upon the
assets and property of the Fund. ]]
[[ARTICLE 11. DEFINITIONS AND INTERPRETATIONS.]] The terms
"specifically approved at least annually," "vote of a majority of the
outstanding voting securities," "assignment," "affiliated person," and
"interested person", when used in this Agreement, shall have the respective
meanings specified [in], and shall be construed in a manner consistent with, the
Investment Company Act of 1940 and the [Rules and Regulations thereunder,
subject, however, to such exemptions as may be granted by ][[rules and
regulations promulgated thereunder. Any question of interpretation of any term
or provision of this Agreement having a counterpart in or otherwise derived from
a term or provision of the Investment Company Act of 1940, the Investment
Advisers Act of 1940, the Securities Act of 1933, or the Securities Exchange Act
of 1934 (collectively, the "Federal Securities Acts") shall be resolved by
reference to such term or provision of the Federal Securities Acts and to
interpretations thereof, if any, by United States federal courts or, in the
absence of any controlling decisions of any such court, by rules or regulations
of]] the Securities and Exchange Commission [under said Act][[. Where the effect
of a requirement of the Federal Securities Acts reflected in any provision of
this Agreement is revised by rule or regulation of the Securities and Exchange
Commission, such provisions shall be deemed to incorporate the effect of such
rule, regulation, order or administrative interpretation.]]
[[ARTICLE 12. RECORD KEEPING. The Adviser will maintain records
in a form acceptable to the Fund and in compliance with the rules and
regulations of the Securities and Exchange Commission, including but not limited
to records required to be maintained by Section 31(a) of the Investment Company
Act of 1940 and the rules thereunder, which at all times will be the property of
the Fund and will be available for inspection and use by the Fund.]]
[[ARTICLE 13. MISCELLANEOUS. (a) This Agreement contains the
entire understanding and agreement of the parties with respect to the subject
matter hereof.]]
[[(b) Headings in this Agreement are for ease of reference only and
shall not constitute a part of the Agreement.]]
[[(c) Should any portion of this Agreement for any reason be held void
in law or equity, the remainder of the Agreement shall be construed to the
extent possible as if such voided portion had never been contained herein.]]
[[(d) This Agreement shall be governed by the laws of the Commonwealth
of Massachusetts, without giving effect to the choice of laws provisions
thereof, except that questions of interpretation shall be resolved in accordance
with the provisions of Article 11 above.]]
THE 2001 MFS FUND SHAREHOLDER PROXY
VOTING INSTRUCTIONS
IT'S FAST, IT'S EASY
You've read through the materials and you're ready to vote. To make it fast and
easy, you have three ways to vote - by Internet, phone, or by mail. Votes by
phone or Internet will be confirmed and posted immediately. If you vote by phone
or Internet, you don't need to mail your proxy card(s).
INTERNET VOTING
1. Go to www.proxyweb.com or to the proxy voting link on www.mfs.com.
---------------- -----------
2. Enter the 12-digit control number on your proxy card.
3. Follow the instructions on the site.
TELEPHONE VOTING
1. Call toll-free, 1-888-221-0697.
2. Enter the 12-digit control number on your proxy card.
3. Follow the recorded instructions.
MAIL VOTING
1. Complete and sign the proxy card.
2. Place the card in the postage paid return envelope and put it in the
mail.
Your vote is important. It is your right as a shareholder. Please vote now.
Thank you for your participation.
From: ------------
PROXY TABULATOR FIRST CLASS
P.O. BOX 9132 U.S. POSTAGE
HINGHAM, MA 02043-9132 PAID
PROXY
TABULATOR
------------
VOTE TODAY BY MAIL,
TOUCH-TONE PHONE OR THE INTERNET
CALL TOLL-FREE 1-888-221-0697
OR LOG ON TO WWW.PROXYWEB.COM
**** CONTROL NUMBER: 999 999 999 999 99 ****
o Please fold and detach card at perforation before mailing o
MFS MULTIMARKET INCOME TRUST PROXY FOR A MEETING OF SHAREHOLDERS
MFS FAMILY OF FUNDS TO BE HELD ON OCTOBER 12, 2001
THIS PROXY IS SOLICITED ON BEHALF OF THE TRUSTEES OF THE FUND.
The undersigned hereby appoints James R. Bordewick, Jr., Stephen E. Cavan, James
O. Yost, Arnold D. Scott and Jeffrey L. Shames and each of them separately,
proxies, with power of substitution, and hereby authorizes them to represent,
and to vote, as designated on the reverse side, at the Meeting of Shareholders
of MFS Multimarket Income Trust, on Friday, October 12, 2001 at 9:30 a.m.,
Boston time, and at any adjournments thereof, all of the shares of the Fund
which the undersigned would be entitled to vote if personally present.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR ALL PROPOSALS. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON
SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING. THE TRUSTEES
RECOMMEND A VOTE FOR THE PROPOSALS ON THE REVERSE SIDE.
THIS PROXY CARD IS VALID ONLY WHEN
SIGNED AND DATED.
Date_________________________________
Signature (PLEASE SIGN WITHIN BOX)
--------------------------------------
--------------------------------------
NOTE: Please sign exactly as name
appears on this card. All joint owners
should sign. When signing as executor,
administrator, attorney, trustee or
guardian or as custodian for a minor,
please give full title as such. If a
corporation, please sign in full
corporate name and indicate the signer's
office. If a partnership, sign in the
partnership name.
o Please fold and detach card at perforation before mailing o
PLEASE FILL IN BOX(ES) AS SHOWN USING BLACK OR BLUE INK OR NUMBER 2 PENCIL. [X]
PLEASE DO NOT USE FINE POINT PENS.
YOUR TRUSTEES RECOMMEND THAT YOU VOTE FOR ALL ITEMS.
FOR all nominees WITHHOLD
listed (except as authority
ITEM 1. To elect a Board of Trustees. marked to the to vote for
NOMNIEES: (01) Jeffrey L. Shames, (02) John W. Ballen, (03) contrary at left) all nominees
Lawrence H. Cohn, M.D., (04) The Hon. Sir J. David Gibbons, KBE,
(05) William R. Gutow, (06) J. Atwood Ives, (07) Abby M. O'Neill, [ ] [ ] 1.
(08) Lawrence T. Perera, (09) William J. Poorvu, (10) Arnold D. Scott
(11) J. Dale Sherratt, (12) Elaine R. Smith and (13) Ward Smith
INSTRUCTION: To withhold authority to vote for any individual nominee, write
the nominee's name on the space provided below.
FOR AGAINST ABSTAIN
------------- -----------------------------------------------------------------
ITEM 2. To authorize the Trustees to adopt an Amended and Restated [ ] [ ] [ ] 2.
Declaration of Trust.
ITEM 3. To amend or remove certain fundamental investment policies. [ ] [ ] [ ] 3.
ITEM 4. To approve a new investment advisory agreement with [ ] [ ] [ ] 4.
Massachusetts Financial Services Company.
ITEM 5. To ratify the selection of the independent public accountants [ ] [ ] [ ] 5.
for the current fiscal year.