UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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 [ ]
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CHECK THE APPROPRIATE BOX:
[ ] Preliminary Proxy Statement
[ ]
(AMENDMENT NO.)
Filed by the Registrantx Filed by a Party Other Than the Registrant¨
Check the Appropriate Box:
| ¨ | Preliminary Proxy Statement |
| ¨ | Confidential for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
| x | Definitive Proxy Statement |
| ¨ | Definitive Additional Materials |
| ¨ | Soliciting Material Pursuant to sec. 240.14a-11(c) of sec. 240.14a-12 |
MFS SERIES TRUST I
MFS SERIES TRUST II
MFS SERIES TRUST III
MFS SERIES TRUST IV
MFS SERIES TRUST V
MFS SERIES TRUST VI
MFS SERIES TRUST VIII
MFS SERIES TRUST IX
MFS SERIES TRUST X
MFS SERIES TRUST XI
MFS SERIES TRUST XII
MFS SERIES TRUST XIII
MASSACHUSETTS INVESTORS GROWTH STOCK FUND
MASSACHUSETTS INVESTORS TRUST
(Names of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
MFS Series Trust I
MFS Series Trust II
MFS Series Trust III
MFS Series Trust IV
MFS Series Trust V
MFS Series Trust VI
MFS Series Trust VII
MFS Series Trust VIII
MFS Series Trust IX
MFS Series Trust X
MFS Series Trust XI
MFS Municipal Series Trust
Massachusetts Investors Growth Stock Fund
Massachusetts Investors Trust
MFS Government Limited Maturity Fund
MFS Government Securities Fund
MFS Growth Opportunities Fund
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(Name of RegistrantRegistrants as Specified in its Charter)
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(Nametheir Charters)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[ ]Registrants)
Payment of Filing Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
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filing fee is calculated and state how it was determined)Appropriate Box):
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| ¨ | 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: |
| MFS® Aggressive Growth Allocation Fund | MFS® Lifetime 2030 Fund | |
| MFS® Bond Fund | MFS® Lifetime 2040 Fund | |
| MFS® Cash Reserve Fund | MFS® Limited Maturity Fund | |
| MFS® Conservative Allocation Fund | Massachusetts Investors Growth Stock Fund | |
| MFS® Core Equity Fund | Massachusetts Investors Trust | |
| MFS® Core Growth Fund | MFS® Mid Cap Growth Fund | |
| MFS® Emerging Growth Fund | MFS® Mid Cap Value Fund | |
| MFS® Global Equity Fund | MFS® Moderate Allocation Fund | |
| MFS® Global Growth Fund | MFS® New Discovery Fund | |
| MFS® Global Total Return Fund | MFS® New Endeavor Fund | |
| MFS® Government Securities Fund | MFS® Research Fund | |
| MFS® Growth Allocation Fund | MFS® Research Bond Fund | |
| MFS® High Income Fund | MFS® Research International Fund | |
| MFS® Inflation-Adjusted Bond Fund | MFS® Strategic Value Fund | |
| MFS® International Diversification Fund | MFS® Technology Fund | |
| MFS® International New Discovery Fund | MFS® Total Return Fund | |
| MFS® Lifetime Retirement Income Fund | MFS® Utilities Fund | |
| MFS® Lifetime 2010 Fund | MFS® Value Fund | |
| MFS® Lifetime 2020 Fund |
500 Boylston Street, Boston, MA 02116-3741
December 28, 2007
Dear Shareholder:
A Special Meeting of Class R1 shareholders (the “Special Meeting”) of the feeFunds referenced above (each a “Fund” and collectively the “Funds”) will be held at the offices of the Funds, 500 Boylston Street, 24th Floor, Boston, Massachusetts, on February 15, 2008 at 9:30 a.m. Eastern Standard Time.
At this meeting, you are being asked to vote on an important proposal affecting the Class R1 shares of your Fund(s). The Board of Trustees of your Fund(s) believes that this proposal is offset asin the Funds’ and your best interest.
While you are, of course, welcome to join us at the Special Meeting on February 15, 2008, most shareholders vote by telephone, over the Internet, or by filling out, signing, and returning the enclosed proxy card(s).
Your vote makes a difference. No matter what the size of your investment, your vote is important. The Board of Trustees of the Funds unanimously recommends that you vote in favor of this proposal, but however you decide to vote, it is important that you take the time to do so. By voting early, you can help save your Fund(s) the expense of additional mailings to solicit shareholder votes.
Information regarding the proposal is available in the proxy statement. There are three convenient ways to vote: by telephone, over the Internet, or by filling out, signing and returning the enclosed proxy card(s). Voting instructions are provided by Exchange Act
Rule 0-11(a)(2)on the enclosed proxy card(s).
If you have any questions, please contact your investment professional. For questions regarding the proposal, please call the proxy solicitor, Broadridge Financial Solutions, Inc., toll-free at 866-414-6353, Monday-Friday, 9:30 a.m. to 9:00 p.m. Eastern Standard Time and identify the filingSaturday, 10:00 a.m. to 6:00 p.m. Eastern Standard Time.
Thank you for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the dateyour prompt vote.
Sincerely,
Maria F. Dwyer
President
MFS® Family of its filing.
1) Amount previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
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To the Class R1 Shareholders of: | ||
| MFS® Aggressive Growth Allocation Fund | MFS® Lifetime 2030 Fund | |
| MFS® Bond Fund | MFS® Lifetime 2040 Fund | |
| MFS® Cash Reserve Fund | MFS® Limited Maturity Fund | |
| MFS® Conservative Allocation Fund | Massachusetts Investors Growth Stock Fund | |
| MFS® Core Equity Fund | Massachusetts Investors Trust | |
| MFS® Core Growth Fund | MFS® Mid Cap Growth Fund | |
| MFS® Emerging Growth Fund | MFS® Mid Cap Value Fund | |
| MFS® Global Equity Fund | MFS® Moderate Allocation Fund | |
| MFS® Global Growth Fund | MFS® New Discovery Fund | |
| MFS® Global Total Return Fund | MFS® New Endeavor Fund | |
| MFS® Government Securities Fund | MFS® Research Fund | |
| MFS® Growth Allocation Fund | MFS® Research Bond Fund | |
| MFS® High Income Fund | MFS® Research International Fund | |
| MFS® Inflation-Adjusted Bond Fund | MFS® Strategic Value Fund | |
| MFS® International Diversification Fund | MFS® Technology Fund | |
| MFS® International New Discovery Fund | MFS® Total Return Fund | |
| MFS® Lifetime Retirement Income Fund | MFS® Utilities Fund | |
| MFS® Lifetime 2010 Fund | MFS® Value Fund | |
| MFS® Lifetime 2020 Fund | ||
500 BOYLSTON STREET, BOSTON, MASSACHUSETTS 02116
NOTICE OF A SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON MARCH 23, 2005
AFEBRUARY 15, 2008
Notice is hereby given that a Special Meeting of Shareholders of eachthe Class R1 shareholders (the “Special Meeting”) of the aboveFunds referenced fundsabove (each a "Fund"“Fund” and collectively the "Funds"“Funds”) will be held at the Funds’ offices at 500 Boylston Street, Boston, Massachusetts 02116,on Friday, February 15, 2008, at 9:30 a.m. on Wednesday, March 23, 2005,Eastern Standard Time, for the following purposes:
ITEM 1. To elect Lawrence H. Cohn, M.D., David H. Gunning, William R. Gutow,
Michael Hegarty, J. Atwood Ives, Amy B. Lane, Robert J. Manning,
Lawrence T. Perera, Robert C. Pozen, J. Dale Sherratt and Laurie J.
Thomsen as Trustees of each of the trusts of which the Funds are
series.
ITEM 2. For Massachusetts Investors Growth Stock Fund only, to approve or
disapprove a proposal to make non-fundamental an investment policy of
the Fund.
ITEM 3. For MFS Municipal Limited Maturity Fund only, to approve or
disapprove a proposal to revise a fundamental investment policy of
the Fund.
ITEM 4. To transact such other business
Proposal 1 | To approve an amendment to the current Master Distribution Plan adopted pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended, with respect to Class R1 Shares of your Fund. | |
Proposal 2 | To transact such other business that may properly come before the Special Meeting or any adjournment thereof. | |
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS
THAT YOU CAST YOUR VOTE “FOR” PROPOSAL 1.
This is a notice and proxy statement for your Fund’s shareholder meeting. Each Fund’s Class R1 shareholders of record as of the close of business on December 10, 2007 will be entitled to notice of, and to vote at, the Special Meeting and any adjournments thereof.
Each Fund will hold a separate meeting. With respect to Item 1, allthereof only on those matters being considered for their Fund. If you own Class R1 shares of more than one of the shareholders of Funds, thatseparate proxy voting cards are series ofincluded for each Fund in which you own Class R1 shares. Please complete, sign and return the same trust will vote together as a
single class. With respectenclosed proxy voting card(s).
Your attention is directed to Item 2 and Item 3, shareholders of only the Funds
indicated will vote.
THE TRUSTEES THAT OVERSEE YOUR FUND RECOMMEND THAT YOU VOTE IN
FAVOR OF ALL ITEMS.
Only a Fund's shareholders of record on January 18, 2005 will be entitled to
vote at that Fund's Meeting of Shareholders.
attached proxy statement.
By order of the Board of Trustees
JAMES R. BORDEWICK, JR.
Susan S. Newton
Assistant Secretary and Assistant Clerk
February 3, 2005
December 28, 2007
YOUR VOTE IS IMPORTANT. WE WOULD APPRECIATE YOURYOU PROMPTLY VOTING, SIGNING AND RETURNING THE ENCLOSED PROXY CARD(S) SO THAT IT IS RECEIVED BY THE DATE OF THE SPECIAL MEETING, OR RECORDING YOUR VOTING INSTRUCTIONS BY TELEPHONE OR VIA THE INTERNET BY 9:29 a.m. EASTERN STANDARD TIME, ON THE DATE OF THE SPECIAL MEETING, WHICH WILL HELP AVOID THE ADDITIONAL EXPENSE OF A SECOND SOLICITATION FOR YOUR TRUST.FUND. THE ENCLOSED ADDRESSED ENVELOPE REQUIRES NO POSTAGE AND IS PROVIDED FOR YOUR CONVENIENCE.
Proxy Statement
| MFS Series Trust I | MFS Series Trust IX | |
MFS Cash Reserve Fund | MFS Bond Fund | |
MFS Core Equity Fund | MFS Inflation-Adjusted Bond Fund | |
MFS Core Growth Fund | MFS Limited Maturity Fund | |
MFS New Discovery Fund | MFS Research Bond Fund | |
MFS Research International Fund | MFS Series Trust X | |
MFS Technology Fund | MFS Aggressive Growth Allocation Fund | |
MFS Value Fund | MFS Conservative Allocation Fund | |
| MFS Series Trust II | MFS Growth Allocation Fund | |
MFS Emerging Growth Fund | MFS International Diversification Fund | |
| MFS Series Trust III | MFS Moderate Allocation Fund | |
MFS High Income Fund | MFS New Endeavor Fund | |
| MFS Series Trust IV | MFS Strategic Value Fund | |
MFS Mid Cap Growth Fund | MFS Series Trust XI | |
| MFS Series Trust V | MFS Mid Cap Value Fund | |
MFS International New Discovery Fund | MFS Series Trust XII | |
MFS Research Fund | MFS Lifetime Retirement Income Fund | |
MFS Total Return Fund | MFS Lifetime 2010 Fund | |
| MFS Series Trust VI | MFS Lifetime 2020 Fund | |
MFS Global Equity Fund | MFS Lifetime 2030 Fund | |
MFS Utilities Fund | MFS Lifetime 2040 Fund | |
| MFS Series Trust VIII | MFS Series Trust XIII | |
MFS Global Growth Fund | MFS Government Securities Fund | |
Massachusetts Investors Growth Stock Fund | ||
| Massachusetts Investors Trust |
500 Boylston Street
Boston, Massachusetts 02116-3741
Special Meeting of Shareholders
To be held February 15, 2008
This Proxy Statement is furnished to the Class R1 shareholders of each Fund referenced above (each a “Fund” and collectively the “Funds”) in connection with the solicitation of proxies by and on behalf of the Board of Trustees (the "Board"“Trustees”) of Massachusetts Investors Growth Stock Fund, Massachusetts Investors Trust, MFS
Series Trust I, MFS Series Trust II, MFS Series Trust III, MFS Series Trust IV,
MFS Series Trust V, MFS Series Trust VI, MFS Series Trust VII, MFS Series Trust
VIII, MFS Series Trust IX, MFS Series Trust X, MFS Series Trust XI, MFS
Municipal Series Trust, MFS Government Limited Maturity Fund, MFS Government
Securities Fund and MFS Growth Opportunities Fund (each a "Trust" and
collectively, the "Trusts"each registered investment company set forth above (the “Trusts”) to be used at the Special Meeting of Shareholders (the "Meeting") of each fund that is a series of one of the Trusts (each a "Fund"
and collectively, the "Funds"“Special Meeting”) to be held at 9:30 a.m., Eastern Standard Time on March 23, 2005February 15, 2008 at 500 Boylston Street, 24th floor, Boston, Massachusetts 02116, for the purposes set forth in the accompanying Notice of a Special Meeting of Shareholders (the "Notice"“Notice”). IfProxies, including proxies given by telephone or via the enclosed form of proxy is executed and returned, it neverthelessInternet, may be revoked prior to its exerciseat any time before they are voted by (i) a signed writing filed withwritten revocation received by the proxy tabulation
agent, Management Information Services Corporation ("MIS"), 60 Research Road,
Hingham, Massachusetts 02043,Secretary of the applicable Fund; (ii) properly executing a later-dated proxy; or delivered at(iii) attending the Meeting.Special Meeting and voting in person. Solicitation of proxies is being made by the mailing of the Notice and this Proxy Statement with its enclosures on or about February 3, 2005.
The followingSpecial Meeting is a list of the proposals for which the Funds are soliciting
proxies, and the Funds that are affected by such proposals:
PROPOSAL AFFECTED FUNDS
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Item 1: To elect Lawrence H. Cohn, M.D., David H. All Funds
Gunning, William R. Gutow, Michael
Hegarty, J. Atwood Ives, Amy B. Lane,
Robert J. Manning, Lawrence T. Perera,
Robert C. Pozen, J. Dale Sherratt and
Laurie J. Thomsen as Trustees of each of
the Trusts.
Item 2: To approve or disapprove a proposalbeing called in order to make Massachusetts Investors
non- fundamental an investment policy of Growth Stock Fund
Massachusetts Investors Growth Stock Fund.
Item 3: To revise a fundamental investment policy MFS Municipal Limited
of MFS Municipal Limited Maturity Fund. Maturity Fund
With respect to Item 1, each Trust will vote separately. This means that for
each Trust, the votes of shareholders of all Funds that are series of that
Trust will be voted together as a single class. With respect to Items 2 and 3,
for each proposal, only theask Class R1 shareholders of the Funds to consider and vote on the following proposals:
Proposal 1 | To approve an amendment to the current Master Distribution Plan adopted pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended, with respect to Class R1 Shares of your Fund. | |
Proposal 2 | To transact such other business that may properly come before the Special Meeting or any adjournment thereof. | |
Shareholders of record of each Fund affectedat the close of business on December 10, 2007 will be entitled to one vote for each dollar of net asset value held on that date (i.e., the number of shares owned times the net asset value per share) (the “Record Holders”). Each fractional dollar amount is entitled to a proportionate fractional vote.
Shareholders have the opportunity to submit their voting instructions via the Internet by using a program provided by aBroadridge Financial Solutions, Inc. (a third-party vendor retained by their
Fund,the Funds), by automated telephone service or by mail using the enclosed proxy card.
card(s). Internet and telephone voting is available until 9:29 a.m., Eastern Standard Time, on February 15, 2008.
The mailing address of each Trustthe Trusts and of each Fundof the Funds is 500 Boylston Street, Boston, Massachusetts 02116. In addition to soliciting proxies by mail, the
Trustees of the Trusts and employees of Massachusetts Financial Services
Company ("MFS"), the Funds' investment adviser and administrator, may solicit
proxies in person or by telephone. Solely in connection with Item 2 and Item 3,
Massachusetts Investors Growth Stock Fund ("MIG") and MFS Municipal Limited
Maturity Fund ("MML") have retained at their own expense Georgeson Shareholders
Communications, Inc., 17 State Street, New York, New York 10004, to aid in the
solicitation of instructions for registered and nominee accounts, for a fee
expected not to exceed $480,000 (MIG) and $11,000 (MML) plus reasonable
out-of-pocket expenses for mailing. The expenses of the preparation of proxy
statements and related materials, including printing and delivery costs, are
borne by the Funds.
A copy of each Fund'sFund’s most recent annual report and semi-annual report may be obtained without charge by contacting MFS Service Center, Inc., each Fund'sthe Funds’ transfer and shareholder servicing agent, at 500 Boylston Street, Boston, Massachusetts 02116, or by telephoning toll-free (800) 225-2606.
ITEM 1 - ELECTION OF TRUSTEES
The Board, which oversees each Fund, provides broad supervision over
Proposal 1:
To Approve an Amendment to the affairsCurrent Master Distribution Plan Adopted Pursuant to Rule 12b-1 under the Investment Company Act of each Fund. MFS is responsible for the investment management1940, as amended, with Respect to Class R1 Shares of each
Fund's assets and for providing a variety of other administrative services to
each Fund. The officersYour Fund(s)
Introduction
Class R1 Shares of each Fund are sold to retirement plans at their net asset value without an initial sales charge. Class R1 Shares have generally been available to retirement plans only if MFS or an affiliate of MFS is either responsible for its operations.
Effective March 22, 2005, the Boardproviding participant recordkeeping services or has fixed the numberentered into an administrative arrangement with a third party to provide certain recordkeeping and/or administrative services. As of Trustees of each
Trust at eleven. The Nomination and Compensation Committee of the Board makes
recommendations concerning the nominees for Trustees and consists solely of
Trustees who areJanuary 1, 2008, Class R1 shares will be available to other retirement plans where MFS or an affiliate is not "interested persons" (as definedproviding participant recordkeeping services or has not entered into an administrative arrangement with a third party to provide recordkeeping or administrative services.
Each Fund has adopted a distribution plan in accordance with Rule 12b-1 under the Investment Company Act of 1940, as amended (the "1940 Act"“Distribution Plan”). Under the Distribution Plan, each Fund pays distribution and/or service fees to MFS Fund Distributors, Inc. (“MFD”), the principal underwriter of each Fund, to support the sale and distribution of shares as well as shareholder servicing and account maintenance activities (“12b-1 Fees”). With respect to Class R1 Shares, these distribution and service fees
2
equal on an annual basis up to 0.75% of the average daily net assets attributable to Class R1 Shares, of which 0.50% is a distribution fee and 0.25% is a service fee.
In addition, Massachusetts Financial Services Company (“MFS”), each Fund’s investment adviser and administrator, provides, either directly or through affiliated and/or unaffiliated entities, certain administrative, recordkeeping, and communication/educational services to the retirement plans and retirement plan participants that invest in Class R1 Shares under a Master Class R Administration and Services Agreement (the “Class R Administration and Services Agreement”). Under the Class R Administration and Services Agreement, Class R1 Shares pay an annual fee of 0.35% of the average daily net assets attributable to Class R1 Shares to MFS for these services (the “Class R1 Administrative Services Fee”).
MFS is proposing to amend each Fund’s Distribution Plan to increase the Class R1 12b-1 Fee from 0.75% to 1.00% of the average daily net assets attributable to Class R1 Shares, an increase of 0.25%. If Proposal 1 is approved by Class R1 shareholders of all of the Funds, MFS will eliminate the 0.35% Class R1 Administrative Services Fee, resulting in a 0.10% reduction in the total expense ratio of Class R1 Shares of each Fund. If Proposal 1 is not approved by shareholders ofall of the Funds, the Proposal will not be implemented and the Class R1 12b-1 Fee and the Class R1 Administrative Services Fee will remain unchanged for all Funds. The Proposal is discussed in further detail below under “Proposed Changes to the Current Distribution Plan.”
General Information about the Current Distribution Plan
The Distribution Plan was adopted on January 1, 1997, and was amended on April 26, 2005, January 24, 2006, April 25, 2006, and October 25, 2006. Under the Distribution Plan, each Fund pays distribution and/or service fees to MFD to support the sale and distribution of MFS. ThoseClass R1 Shares, as well as shareholder servicing and account maintenance activities. These distribution and service fees equal on an annual basis up to 0.75% of the average daily net assets attributable to Class R1 Shares, of which 0.50% is a distribution fee and 0.25% is a service fee. The Distribution Plan is designed to promote sales of shares of the Funds and minimize redemptions, as well as to assist in the servicing and maintenance of shareholder accounts.
Distribution fees compensate MFD and/or financial intermediaries for their expenses in connection with the distribution of Fund shares, including, but not limited to, commissions to financial intermediaries, printing prospectuses and reports used for sales purposes, the preparation and printing of sales literature, personnel, travel, office expense and equipment, payments made to wholesalers employed by MFD (employees may receive additional compensation if they meet certain targets for sales of one or more MFS Funds), and other distribution-related expenses.
Service fees compensate MFD and/or financial intermediaries for shareholder servicing and account maintenance activities, including, but not limited to, shareholder recordkeeping (including assisting in establishing and maintaining customer accounts and records), transaction processing (including assisting with purchase, redemption and exchange requests), shareholder reporting, arranging for bank wires, monitoring dividend payments from the Funds on behalf of customers, forwarding certain shareholder communications from the Funds to customers, corresponding with shareholders and customers regarding the Funds (including receiving and responding to inquiries and answering questions regarding the Funds), and aiding in maintaining the investment of their respective customers in the Funds.
3
The Distribution Plan remains in effect from year to year only if its continuance is specifically approved at least annually by a vote of the Trustees, including a majority of the Trustees who are not "interested persons"“interested persons” of the Funds or of MFS are referred
to as "Independent Trustees" throughout this Proxy Statement.(the “independent Trustees”). The Nomination
and Compensation Committee has recommended thatDistribution Plan for each Fund was most recently approved by the Board nominateof Trustees in July 2007.
Proposed Changes to the Current Distribution Plan
Proposal 1 would amend the Funds’ Distribution Plan to increase the 12b-1 Fees payable under the Distribution Plan with respect to Class R1 Shares from 0.75% to 1.00% of the average daily net assets attributable to a Fund’s Class R1 Shares, an increase of 0.25%. If Proposal 1 is approved by Class R1 shareholders of all of the Funds, MFS will eliminate the Class R1 Administrative Services Fee of 0.35% for electioneach Fund and terminate the Class R Administration and Services Agreement. As a result, the total expense ratio of Class R1 Shares of each Fund will decrease by shareholders0.10%. The additional 0.25% of 12b-1 Fees will generally be used by MFD to compensate recordkeepers, who are currently receiving the nominees describedClass R1 Administrative Services Fee of 0.35%, and MFD does not intend to retain any amounts attributable to the increase in the following pages,Class R1 12b-1 Fee.
The amendment to the Distribution Plan to increase the Class R1 12b-1 Fee and the Board
has nominated such individuals. The Board recommends that you vote in favorcorresponding elimination of their election.
The Funds do not hold annual shareholder meetings for the purposeClass R1 Administrative Services Fee will only be implemented if Proposal 1 is approved by Class R1 shareholders of electing
Trustees,all of the Funds. If approved, the amendment to the Distribution Plan and Trustees are not elected for fixed terms. This means that each
Trusteethe corresponding elimination of the Class R1 Administrative Services Fee will be elected to hold office until his or her successor is chosen and
qualified or until his or her earlier death, resignation, retirement or
removal. It is intended that proxies not limited toeffective March 1, 2008 (or such later date as authorized by the contrary will be voted
in favor of electing Lawrence H. Cohn, M.D., David H. Gunning, William R.
Gutow, Michael Hegarty, J. Atwood Ives, Amy B. Lane, Robert J. Manning,
Lawrence T. Perera, Robert C. Pozen, J. Dale Sherratt and Laurie J. Thomsen as
Trustees of each Trust.
Dr. Cohn, Messrs. Gunning, Gutow, Hegarty, Ives, Perera and Sherratt and Ms.
Lane currently are Trustees of each Trust. Messrs. Manning and Pozen and Ms.
Thomsen currently are not Trustees of any Trust, although Messrs. Manning and
Pozen previously served as Trustees of the Trusts. Effective December 16, 2004,
Messrs. Manning and Pozen and Ms. Thomsen were appointedFunds). If Proposal 1 is not approved by the Board as
"Advisory Trustees" and were nominated by the Board to be elected as Trustees
by shareholders. As Advisory Trustees, they attend meetings (or portions
thereof)Class R1 shareholders of the Board or Committees of the Board at the invitation of the
Trustees and provide such advice and consultation as the Trustees may
reasonably request. Effective December 16, 2004, Mr. Hegarty was appointed as a
Trustee by the Board.
Independent Trustees recommended Mr. Hegarty and Ms. Thomsen for the position
of Trustee, and MFS recommended Messrs. Manning and Pozen for the position of
Trustee.
Each nominee has agreed to serve as a Trustee of each Trust if elected. If,
before the Meeting, any nominee refuses or is unable to serve, or if any of the
nominees is unavailable at the time of the Meeting, and such refusal or
inability to serve or unavailability is not anticipated, the Trustees may vote
for other nominees at their discretion, or the Trustees may fix the number of
Trustees at fewer than eleven for a Trust. Under the terms of each Trust's
retirement policy, the Trustees have a mandatory retirement age of 73 years.
For each Trust, the eleven nominees for election as Trustees who receive the
greatest number of shareholder votes will be elected as Trustees of the Trust.
The following table presents certain information regarding the nominees and
the current Trustees of each Trust who are standing for reelection, 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.
PRINCIPAL OCCUPATION(s)
POSITION(s) HELD DURING PAST FIVE YEARS &
NAME, DATE OF BIRTH WITH TRUST(1) LENGTH OF SERVICE OTHER DIRECTORSHIPS(2)
- ------------------- ---------------- ----------------- --------------------------
INTERESTED TRUSTEE NOMINEES
Robert J. Manning* Advisory Trustee Since December Massachusetts Financial
(born 10/20/63) and President 2004 (Advisory Services Company, Chief
Trustee); Since Executive Officer,
February 2004 President, Chief
(President); Investment Officer and
February-December Director
2004 (Trustee)
Robert C. Pozen* Advisory Trustee Since December Massachusetts Financial
(born 08/08/46) 2004 (Advisory Services Company, Chairman
Trustee); (since February 2004);
February-December Harvard Law School
2004 (Trustee) (education), John Olin
Visiting Professor (since
July 2002); Secretary of
Economic Affairs, The
Commonwealth of
Massachusetts (January 2002
to December 2002); Fidelity
Investments, Vice Chairman
(June 2000 to December
2001); Fidelity Management
& Research Company
(investment adviser),
President (March 1997 to
July 2001); The Bank of New
York (financial services),
Director; Bell Canada
Enterprises
(telecommunications),
Director; Medtronic, Inc.
(medical technology),
Director; Telesat
(satellite communications),
Director
INDEPENDENT TRUSTEE NOMINEES
Lawrence H. Cohn, M.D. Trustee Since August 1993 Brigham and Women's
(born 03/11/37) Hospital, Chief of Cardiac
Surgery; Harvard Medical
School, Professor of
Surgery
David H. Gunning Trustee Since January 2004 Cleveland-Cliffs Inc.
(born 05/30/42) (mining products and
service provider), Vice
Chairman/Diector (since
April 2001); Encinitos
Ventures (private
investment company),
Principal (1997 to April
2001); Lincoln Electric
Holdings, Inc. (welding
equipment manufacturer),
Director
William R. Gutow Trustee Since December Private investor and real
(born 09/27/41) 1993 estate consultant; Capital
Entertainment Management
Company (video franchise),
Vice Chairman
Michael Hegarty Trustee Since December Retired; AXA Financial
(born 12/21/44) 2004 (financial services and
insurance), Vice Chairman
and Chief Operating Officer
(until May 2001); The
Equitable Life Assurance
Society (insurance),
President and Chief
Operating Officer (until
May 2001)
J. Atwood Ives Trustee and Chair of Since February Private investor; Eastern
(born 05/01/36) the Trusees 1992 Enterprises (diversified
services company),
Chairman, Trustee and Chief
Executive Officer (until
November 2000)
Amy B. Lane Trustee Since January 2004 Retired; Merrill Lynch &
(born 02/08/53) Co., Inc., Managing
Director, Investment
Banking Group (1997 to
February 2001); Borders
Group, Inc. (book and music
retailer), Diector; Federal
Realty Investment Trust
(real estate investment
trust), Trustee
Lawrence T. Perera Trustee Since July 1981 Hemenway & Barnes
(born 06/23/35) (attorneys), Partner
J. Dale Sherratt Trustee Since August 1993 Insight Resources, Inc.
(born 09/23/38) (acquisition planning
specialists), President;
Wellfleet Investments
(investor in health care
companies), Managing
General Partner; Cambridge
Nutraceuticals
(professional nutritional
products), Chief Executive
Officer (until May 2001)
Laurie J. Thomsen Advisory Trustee Since December Private investor; Prism
(born 08/05/57) 2004 Venture Partners (venture
capital), Co-founder and
General Partner (until June
2004); St. Paul Travelers
Companies (commercial
property liability
insurance), Director
- ----------
(1) Each current Trustee has served continuously since appointment. Messrs. Manning and Pozen, who are
not currently Trustees of any Trust, served as Trustees from February to December 2004 and
voluntarily resigned effective December 15, 2004 so that the composition of the Board would comply
with the 1940 Act requirement that a certain minimum percentage of Trustees be elected by Trust
shareholders following the appointment by the Trustees of Mr. Hegarty as an Independent Trustee on
December 16, 2004.
(2) Directorships or trusteeships of companies required to report to the Securities and Exchange
Commission ("SEC") (i.e., "public companies").
* "Interested person" of the Trust within the meaning of the 1940 Act, as a result of position with
MFS. The address of MFS is 500 Boylston Street, Boston, Massachusetts 02116.
Each current Trustee listed above serves as a board member of 97 funds within
the MFS Family of Funds. The address of each Trustee and of each Advisory
Trustee is c/o MFS, 500 Boylston Street, Boston, Massachusetts 02116.
Information about each Fund, including information about its investment
adviser, principal underwriter and administrator, independent registered public
accounting firm, executive officers, and the interests of certain persons
appears under "Fund Information" beginning on page 43.
REQUIRED VOTE
For each Trust, approval of this matter as to any nominee will require the
affirmative vote of a plurality of the Trust's outstanding shares voting at the
Meeting in person or by proxy. Shareholders of all Funds of each Trust will
vote together as a single class on this Item 1.
THE TRUSTEES OF THE TRUSTS UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS OF THE
FUNDS VOTE TO ELECT EACH OF THE NOMINEES AS TRUSTEES OF EACH TRUST.
COMMITTEES
Each Trust's Board meets regularly throughout the year to discuss matters and
to take certain actions relating to the Trust. Each Trust's Board has several
standing committees, which are described below.
NUMBER OF
MEETINGS IN
LAST FISCAL
NAME OF COMMITTEE YEAR(1) FUNCTIONS CURRENT MEMBERS(2)
- --------------------------------------------------------------------------------------------------------------------------
AUDIT COMMITTEE 7 Oversees the accounting and auditing procedures Ives*, Lane* and
of the Trust and, among other things, considers Sherratt*
the selection of the Independent Registered
Public Accounting Firm for the Trust and the
scope of the audit, and considers the effect on
the independence of those accountants of any
non-audit services such accountants provide to
the Trust and any audit or non-audit services
such accountants provide to other MFS Funds, MFS
and/or certain affiliates. The Committee is also
responsible for the periodic review and approval
of the Trust's custodial, transfer agency and
administrative service fee arrangements, as well
as for establishing procedures for the receipt,
retention and treatment of complaints received
by the Trust regarding accounting, internal
accounting controls, or auditing matters and the
confidential anonymous submission of concerns
regarding questionable Trust accounting matters
by officers of the Trust and employees of the
Trust's investment adviser administrator,
principal underwriter or any other provider of
accounting-related services to the Trust.
COMPLIANCE AND GOVERNANCE 12 Oversees the development and implementation of Cohn*, Gunning*,
COMMITTEE the Trust's regulatory and fiduciary compliance Gutow*, Hegarty*,
policies, procedures and practices under the
Ives* (ex-officio 1940 Act and other applicable
laws as well as member) and Sherratt* oversight
of compliance policies of the Trust's investment
adviser and certain other service providers as
they relate to Trust activities. The Trust's
Independent Chief Compliance Officer reports
directly to the Committee and assists the
Committee in carrying out its responsibilities.
In addition, the Committee advises and makes
recommendations to the Board on matters
concerning Trustee practices and recommendations
concerning the functions and duties of the
committees of the Board.
CONTRACTS REVIEW 2 Requests, reviews and considers the information All Independent
COMMITTEE deemed reasonably necessary to evaluate the Trustees of the Board
terms of the investment advisory and principal (Cohn, Gunning, Gutow,
underwriting agreements and the Plan of Hegarty,
Ives, Lane, Distribution under Rule 12b-1 that
the Trust Perera, Sherratt and proposes to renew
or continue, and to make its Smith)
recommendations to the full Board of Trustees on
these matters.
NOMINATION AND 1 Recommends qualified candidates to the Board in All Independent
COMPENSATION COMMITTEE the event that a position is vacated or Trustees of the Board
created. The Committee will consider (Cohn,
Gunning, Gutow, recommendations by shareholders
when a vacancy Hegarty Ives, Lane, exists.
Shareholders wishing to recommend Perera,
Sherratt and candidates for Trustee for
consideration by the Smith) Committee may do so
in writing to the Trust's Secretary at the
principal executive office of the Trust. Such
recommendations must be accompanied by
biographical and occupational data on the
candidate (including whether the candidate would
be an "interested person" of the Trust), a
written consent of the candidate to be named as
a nominee and to serve as Trustee if elected,
record and ownership information for the
recommending shareholder with respect to the
Trust, and a description of any arrangements or
understandings regarding recommendation of the
candidate for consideration. The Committee is
also responsible for making recommendations to
the Board regarding any necessary standards or
qualifications for service on the Board. The
Committee also reviews and makes recommendations
to the Board regarding compensation for the
Independent Trustees.
PORTFOLIO TRADING AND 6 Oversees the policies, procedures, and Cohn*, Gunning*,
MARKETING REVIEW COMMITTEE practices of the Trust with respect to Gutow*, Hegarty*,
brokerage transactions involving portfolio Ives*
(ex-officio securities as those policies,
procedures and member), Perera* and practices
are carried out by MFS and its Smith*
affiliates. The Committee also oversees the
administration of the Trust's proxy voting
policies and procedures by MFS. In addition the
Committee receives reports from MFS regarding
the policies, procedures and practices of MFS
and its affiliates in connection with their
marketing and distribution of shares of the
Trust.
PRICING COMMITTEE 6 Oversees the determination of the value of the Ives* (ex-officio
portfolio securities and other assets held by member), Lane*,
the Trust and determines or causes to be Perera*
and Smith* determined the fair value of
securities and assets for which market
quotations are not "readily available" in
accordance with the 1940 Act. The Committee
delegates primary responsibility for carrying
out these functions to MFS and MFS' internal
valuation committee pursuant to pricing policies
and procedures approved by the Committee and
adopted by the full Board, which include
methodologies to be followed by MFS to determine
the fair values of portfolio securities and
other assets held by the Trust for which market
quotations are not readily available. The
Committee meets periodically with the members of
MFS' internal valuation committee to review and
assess the quality of fair valuation and other
pricing determinations made pursuant to the
Trust's pricing policies and procedures, and to
review and assess the policies and procedures
themselves. The Committee also exercises the
responsibilities of the Board under the
Amortized Cost Valuation Procedures approved by
the Board on behalf of each Fund which holds
itself out as a "money market fund" in
accordance with Rule 2a-7 under the 1940 Act.
- ----------
(1) The Funds have different fiscal year ends. As a result, information about the number of meetings of each committee
is provided for the calendar year ended December 31, 2004.
(2) Information about each committee member (other than Ms. Elaine Smith, who is not standing for reelection) is set
forth above on pages 9 and 10.
* Independent Trustees.
The Trustees generally hold at least nine regular meetings each calendar
year. These regular meetings take place over a two-day period. The performance
and operations of eachis reviewed by the Trustees at each meetingProposal will not be implemented and more in-depth reviews of particular funds are conducted by the Trustees
throughoutClass R1 12b-1 Fee and the year. The Board of TrusteesClass R1 Administrative Services Fee will remain unchanged for all of the Trusts held nine meetings
during the calendar year ended December 31, 2004.
NOMINATION AND COMPENSATION COMMITTEE
The Trustees have adopted a written charter for the Nomination and
Compensation Committee, a copy of whichFunds.
MFS believes that Proposal 1 is included as Exhibit 1 to this Proxy
Statement. The Trusts currently do not maintain a website on which the charter
is available.
The Nomination and Compensation Committee requires that Trustee candidates
have a college degree or equivalent business experience, but has not otherwise
established specific, minimum qualifications that must be met by an individual
to be considered by the Committee for nomination as a Trustee. The Nomination
and Compensation Committee may take into account a wide variety of factors in
considering Trustee candidates, including, but not limited to: (i) availability
and commitment of a candidate to attend meetings and perform his or her
responsibilities to the Board; (ii) relevant industry and related experience;
(iii) educational background; (iv) financial expertise; (v) an assessment of
the candidate's ability, judgment and expertise; (vi) overall diversity of the
composition of the Board; and (vii) such other factors as the Committee deems
appropriate. The Nomination and Compensation Committee may consider candidates
for Trustee recommended by each Trust's current Trustees, officers or
shareholders or by MFS or any other source deemed appropriate by the Nomination
and Compensation Committee. The Nomination and Compensation Committee may, but
is not required to, retain a third-party search firm at the applicable Trust's
expense to identify potential candidates.
The Nomination and Compensation Committee will review and consider nominees
recommended by shareholders to serve as Trustee, provided that the recommending
shareholder follows the Procedures for Shareholders to Submit Nominee
Candidates, which are set forth as Appendix B to the Trusts' Nomination and
Compensation Committee Charter, attached to this Proxy Statement as Exhibit 1.
Among other requirements, these procedures provide that the recommending
shareholder must submit any recommendation in writing to the Trust, to the
attention of the Trust's Secretary, at the address of the principal executive
offices of the Trust. Any recommendation must include certain biographical
information and other information regarding the candidate and the recommending
shareholder, and must include a written and signed consent of the candidate to
be named as a nominee and to serve as a Trustee if elected. The foregoing
description is only a summary. Please refer to Exhibit 1 for details.
The Nomination and Compensation Committee has full discretion to reject
nominees recommended by shareholders, and there is no assurance that any such
person properly recommended and considered by the Committee will be nominated
for election to the Board of a Trust.
SHARE OWNERSHIP
As of January 18, 2005, the Trustees and officers of each Trust as a whole
owned less than 1% of the outstanding shares of any class of any Fund.
The following table shows the dollar range of equity securities beneficially
owned by each nominee (i) in each Trust and (ii) on an aggregate basis, in all
MFS funds overseen, or to be overseen, by the Trustee as of January 18, 2005.
The following dollar ranges apply:
N. None
A. $1 - $10,000
B. $10,001 - $50,000
C. $50,001 - $100,000
D. Over $100,000
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MASSACHUSETTS INVESTORS MASSACHUSETTS
NAME OF TRUSTEES GROWTH STOCK FUND INVESTORS TRUST
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning D N
Robert C. Pozen B B
Independent Trustee Nominees
Lawrence H. Cohn, M.D. D D
David H. Gunning N N
William R. Gutow C N
Michael Hegarty N N
J. Atwood Ives D D
Amy B. Lane N N
Lawrence T. Perera B C
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS AGGRESSIVE GROWTH MFS ALABAMA
NAME OF TRUSTEES ALLOCATION FUND MUNICIPAL BOND FUND
- ---------------- ----------------------- --------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS ARKANSAS MUNICIPAL MFS
NAME OF TRUSTEES BOND FUND BOND FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N D
Amy B. Lane N N
Lawrence T. Perera N B
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS CALIFORNIA MUNICIPAL MFS CAPITAL
NAME OF TRUSTEES BOND FUND OPPORTUNITIES FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N B
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N D
Amy B. Lane N N
Lawrence T. Perera N C
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS CASH MFS CONSERVATIVE
NAME OF TRUSTEES RESERVE FUND ALLOCATION FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. A N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS CORE MFS CORE
NAME OF TRUSTEES EQUITY FUND GROWTH FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. B N
David H. Gunning C N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt B N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS EMERGING MFS EMERGING MARKETS
NAME OF TRUSTEES GROWTH FUND DEBT FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning D N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. B N
David H. Gunning N N
William R. Gutow C N
Michael Hegarty N N
J. Atwood Ives D N
Amy B. Lane N N
Lawrence T. Perera B N
J. Dale Sherratt B N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS EMERGING MARKETS MFS EMERGING
NAME OF TRUSTEES EQUITY FUND OPPORTUNITIES FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera A N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS FLOATING RATE MFS FLORIDA MUNICIPAL
NAME OF TRUSTEES HIGH INCOME FUND BOND FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS GEMINI MFS GEORGIA MUNICIPAL
NAME OF TRUSTEES U.K. FUND BOND FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS GLOBAL MFS GLOBAL
NAME OF TRUSTEES EQUITY FUND GROWTH FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. D B
David H. Gunning C N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt B B
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS GLOBAL MFS GLOBAL
NAME OF TRUSTEES TOTAL RETURN FUND VALUE FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. B N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives D N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt B N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS GOVERNMENT LIMITED MFS GOVERNMENT MONEY
NAME OF TRUSTEES MATURITY FUND MARKET FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N D
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. A N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N B
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt B N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS GOVERNMENT MFS GROWTH
NAME OF TRUSTEES SECURITIES FUND ALLOCATION FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N A
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives C N
Amy B. Lane N N
Lawrence T. Perera B N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS GROWTH MFS HIGH
NAME OF TRUSTEES OPPORTUNITIES FUND INCOME FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning D N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives B B
Amy B. Lane N N
Lawrence T. Perera B B
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS HIGH YIELD MFS INFLATION-ADJUSTED
NAME OF TRUSTEES OPPORTUNITIES FUND BOND FUND
- ---------------- --------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives A N
Amy B. Lane N N
Lawrence T. Perera A N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS INTERMEDIATE
INVESTMENT MFS INTERNATIONAL
NAME OF TRUSTEES GRADE BOND FUND DIVERSIFICATION FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS INTERNATIONAL MFS INTERNATIONAL
NAME OF TRUSTEES GROWTH FUND NEW DISCOVERY FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning D N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N C
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N A
Amy B. Lane N N
Lawrence T. Perera A A
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS INTERNATIONAL MFS LARGE CAP
NAME OF TRUSTEES VALUE FUND GROWTH FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N B
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N B
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS LIMITED MFS MANAGED
NAME OF TRUSTEES MATURITY FUND SECTORS FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N A
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives D N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt B B
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS MARYLAND MFS MASSACHUSETTS
NAME OF TRUSTEES MUNICIPAL BOND FUND MUNICIPAL BOND FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N D
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N B
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS MID CAP MFS MID CAP
NAME OF TRUSTEES GROWTH FUND VALUE FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives C A
Amy B. Lane N N
Lawrence T. Perera B N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS MISSISSIPPI MFS MODERATE
NAME OF TRUSTEES MUNICIPAL BOND FUND ALLOCATION FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N C
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS MONEY MFS MUNICIPAL
NAME OF TRUSTEES MARKET FUND BOND FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning D N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives B B
Amy B. Lane N N
Lawrence T. Perera A A
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS MUNICIPAL MFS MUNICIPAL
NAME OF TRUSTEES HIGH INCOME FUND INCOME FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives B N
Amy B. Lane N N
Lawrence T. Perera A N
J. Dale Sherratt D N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS MUNICIPAL MFS NEW
NAME OF TRUSTEES LIMITED MATURITY FUND DISCOVERY FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N B
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives B N
Amy B. Lane N N
Lawrence T. Perera A N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS NEW MFS NEW YORK
NAME OF TRUSTEES ENDEAVOR FUND MUNICIPAL BOND FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS NORTH CAROLINA MFS PENNSYLVANIA
NAME OF TRUSTEES MUNICIPAL BOND FUND MUNICIPAL BOND FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS RESEARCH MFS RESEARCH
NAME OF TRUSTEES BOND FUND BOND FUND J
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS RESEARCH MFS RESEARCH
NAME OF TRUSTEES FUND INTERNATIONAL FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N D
Robert C. Pozen B N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N B
David H. Gunning C N
William R. Gutow C N
Michael Hegarty N N
J. Atwood Ives D A
Amy B. Lane N N
Lawrence T. Perera C N
J. Dale Sherratt N B
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS SOUTH CAROLINA MFS STRATEGIC
NAME OF TRUSTEES MUNICIPAL BOND FUND GROWTH FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N D
Robert C. Pozen N B
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N B
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N B
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS STRATEGIC MFS STRATEGIC
NAME OF TRUSTEES INCOME FUND VALUE FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N D
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. A N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives B N
Amy B. Lane N N
Lawrence T. Perera A N
J. Dale Sherratt B N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS TECHNOLOGY MFS TENNESSEE
NAME OF TRUSTEES FUND MUNICIPAL BOND FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. B N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt B N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS TOTAL MFS UNION STANDARD
NAME OF TRUSTEES RETURN FUND EQUITY FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen B N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. D N
David H. Gunning D N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives D N
Amy B. Lane N N
Lawrence T. Perera C N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS UTILITIES MFS VALUE
NAME OF TRUSTEES FUND FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N C
Robert C. Pozen N B
Independent Trustee Nominees
Lawrence H. Cohn, M.D. D D
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt B N
Laurie J. Thomsen N N
AGGREGATE DOLLAR AGGREGATE DOLLAR
RANGE OF EQUITY RANGE OF EQUITY
SECURITIES IN THE SECURITIES IN THE
FUND FUND
----------------------- -------------------
MFS VIRGINIA MFS WEST VIRGINIA
NAME OF TRUSTEES MUNICIPAL BOND FUND MUNICIPAL BOND FUND
- ---------------- ----------------------- ---------------------
Interested Trustee Nominees
Robert J. Manning N N
Robert C. Pozen N N
Independent Trustee Nominees
Lawrence H. Cohn, M.D. N N
David H. Gunning N N
William R. Gutow N N
Michael Hegarty N N
J. Atwood Ives N N
Amy B. Lane N N
Lawrence T. Perera N N
J. Dale Sherratt N N
Laurie J. Thomsen N N
AGGREGATE DOLLAR RANGE OF
SECURITIES IN ALL MFS FUNDS
OVERSEEN OR TO BE
NAME OF TRUSTEES OVERSEEN BY THE NOMINEE
- ---------------- ---------------------------
Interested Trustee Nominees
Robert J. Manning D
Robert C. Pozen D
Independent Trustee Nominees
Lawrence H. Cohn, M.D. D
David H. Gunning D
William R. Gutow D
Michael Hegarty N
J. Atwood Ives D
Amy B. Lane A
Lawrence T. Perera D
J. Dale Sherratt D
Laurie J. Thomsen N
SHAREHOLDER COMMUNICATIONS WITH THE BOARD
The Board of each Trust has adopted procedures by which shareholders may send
communications to the Board. Shareholders may mail written communications to
the Board to the attention of the Board, [Name of Fund], c/o Massachusetts
Financial Services Company, 500 Boylston Street, Boston, Massachusetts 02116,
Attention: Frank Tarantino, Independent Chief Compliance Officer. Shareholder
communications must (i) be in writing and be signed by the shareholder, (ii)
identify the MFS Fund to which they relate and (iii) identify the class and
number of shares held by the shareholder. The Funds' Independent Chief
Compliance Officer ("ICCO") is responsible for reviewing all properly submitted
shareholder communications. The ICCO shall either (i) provide a copy of each
properly submitted shareholder communication to the Board at its next regularly
scheduled meeting or (ii) if the ICCO determines that the communication
requires more immediate attention, forward the communication to the Chair of
the Trustees promptly after receipt. The ICCO may, in good faith, determine
that a shareholder communication should not be provided to the Board because it
is ministerial in nature (such as a request for Fund literature, share data or
financial information). The ICCO may in such cases forward the communication to
the appropriate party or parties at MFS. These procedures do not apply to (i)
any communication from an officer or Trustee of a Trust, (ii) any communication
from an employee or agent of a Fund, unless such communication is made solely
in such employee's or agent's capacity as a shareholder or (iii) any
shareholder proposal submitted pursuant to Rule 14a-8 under the Securities
Exchange Act of 1934, as amended (the "1934 Act"), or any communication made in
connection with such a proposal. Each Trust's Trustees are not required to
attend the Funds' shareholder meetings or to otherwise make themselves
available to shareholders for communications, other than pursuant to the
aforementioned procedures.
Each Trust's Declaration of Trust currently provides that the Trust will
indemnify its Trustees and officers against liabilities and expenses incurred
in connection with litigation in which they may be involved because of their
offices with the Trust, unless it is finally adjudicated or, in case of a
settlement, 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 shareholders, as the Trust ortotal expense ratio of Class R1 Shares of each Fund will decrease by 0.10% if Proposal 1 is approved and implemented as described above. In addition, MFS believes that they engagedthe increase in willful misfeasance or acted with bad faith, gross
negligence or reckless disregardthe Class R1 12b-1 Fee and the corresponding elimination of the duties involved in the conductClass R1 Administrative Services Fee may stimulate additional sales of their
offices.
TRUSTEE COMPENSATION TABLE
The tables below show (i) the cash compensation paid to the Trustees by each
Fund for its most recently completed fiscal year and (ii) the total cash
compensation received by each Trustee from the MFS fund complex for calendar
year 2004. Interested Trustees receive no compensation fromClass R1 Shares of the Funds, for their
services as Trustees. The table includes information for Mr. Ward Smith, who
passed away on August 15, 2004, Mr. William Poorvu, who retired as a Trustee of
each Trust at the end of calendar year 2004, and Ms. Smith, who is not standing
for reelection.
A comparison of the current fees and the proposed fees with respect to Class R1 Shares of each Fund is provided inSchedule I: Actual and Pro Forma Fund Expenses.
The amount of fees and expenses paid by making availableClass R1 Shares for each Fund under the current Distribution Plan during each Fund’s most recently reported fiscal year, both in the aggregate and as a broader arraypercentage of equity securities. MFS believesthe Funds’ average daily net asset value, is shown inSchedule IIattached hereto.
Consideration and Recommendation by Trustees
The Trustees reviewed this Proposal and after consideration and consultation with legal counsel unanimously approved the amendment to the Distribution Plan and authorized the Trusts to seek shareholder approval to amend the Distribution Plan as set forth in the Proposal. The Trustees believe that over time, this flexibility has the potential to better serve shareholder
interests. MFS does not anticipatethere is a reasonable likelihood that the proposed revised investment policyfee increase under the Distribution Plan and corresponding
4
elimination of the Class R1 Administrative Services Fee will benefit each Fund’s Class R1 and its shareholders. The Trustees considered numerous factors, including:
| · | the 0.10% decrease in the total expense ratio of Class R1 shares of each Fund after taking into account MFS’ agreement to eliminate the 0.35% Class R1 Administrative Services Fee in conjunction with the implementation of the Proposal; |
| · | the need to pay financial intermediaries and recordkeepers for distribution and service-related activities at industry-standard levels to maintain the scope and quality of services expected by shareholders and to ensure continued access to distribution channels; |
| · | the contribution of the Distribution Plan to the growth and stability of the assets of the Funds; and |
| · | that it is MFD’s intent to use the Class R1 12b-1 Fee increase to compensate financial intermediaries and recordkeepers and not to retain the amount of the increase. |
In addition, the Trustees considered the possible benefits that may be realized by MFS and MFD as a result of the adoption of the amendments to the Distribution Plan, including the possibility that management fees, administrative fees and shareholder servicing fees paid to MFS and MFD would materially change the level of investment risk associatedincrease with an investmentincrease in MIG. Making the policy non-fundamentalsize of the Funds.
Based on these and other factors, each Fund’s Board of Trustees voted to approve such proposed amendment to the Distribution Plan and concluded that the proposed amendment would also givebe in the best interests of each Fund’s Class R1 and its shareholders. The Trustees’ approval included a determination that, in the exercise of reasonable business judgment and in light of their fiduciary duties under applicable laws, there is a reasonable likelihood that the amendment to the Distribution Plan will benefit each Fund’s Class R1 and its shareholders.
If approved by Class R1 shareholders of all of the Funds, the amendment to the Distribution Plan will be effective March 1, 2008 (or such later date as authorized by the Trustees of the flexibilityFunds) and will continue in effect for up to further reviseone year, and then from year to year so long as it is approved by a majority of the policyBoard of Trustees, including a majority of the independent Trustees. The current Distribution Plan provides that it may not be amended to increase materially the amount of the 12b-1 Fee payable under the Distribution Plan unless the increase is approved by the Class R1 shareholders, voting separately, of the respective Fund. Under current regulatory requirements, the 12b-1 Fee cannot be increased above 1.00% of the average daily net assets of the Class. The Distribution Plan will terminate automatically in the future withoutevent of its assignment and may be terminated at any time upon a vote of a majority of the time and expense associated with additional proxy solicitations, although theindependent Trustees who have no current intention to do so.
REQUIRED VOTE
direct or indirect financial interest in the operation of the Distribution Plan, or by vote of a majority of the outstanding Class R1 Shares of a Fund.
Required Vote
Approval of this matter will require the vote of the lesser of (i) 67 per centum67% or more of the outstanding voting securities of MIGthe Class R1 Shares of a Fund present at MIG'sthe Special Meeting, if the holders of more than 50 per centum50% of the outstanding voting securities of MIGthe Class R1 Shares of the Fund are present in person or represented by proxy at the Special Meeting or (ii) more than 50 per centum50% of the outstanding voting securities of MIG, whichever is less.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS OF MIG VOTE TO
APPROVE THE PROPOSAL.
ITEM 3 - PROPOSAL TO REVISE A FUNDAMENTAL INVESTMENT POLICY OF MFS MUNICIPAL
LIMITED MATURITY FUND
MFS Municipal Limited Maturity Fund ("MML") currently hasthe Class R1 Shares of a fundamental
investment policy stating that MML invests, under normal market conditions, at
least 80% of its net assets in "securities and other investments with "limited"
maturities," the interest on which is exempt from federal income tax. MML has a
related non-fundamental investment policy stating that fixed income securities
with limited maturities include securities with remaining maturities of ten
years or less, and that, under normal market conditions, MML's dollar-weighted
average maturityFund.
5
Proposal 1 will not exceed five years. Because MML seeks to provide
shareholders with tax-exempt income, its policy of investing in tax-exempt
securities mustonly be fundamental, which means thatimplemented if it cannot be changed without
shareholder approval. MML is not required, however, to have a fundamental
policy with respect to the maturity of the bonds it holds. Therefore, the
Trustees have approved, and are recommending that shareholders approve, the
revision of MML's fundamental investment policy to remove the explicit
reference to ""limited" maturities." If the proposed revised fundamental
investment policy is approved by Class R1 shareholders ofall of the Trustees intend to reviseFunds. If Proposal 1 is not approved by Class R1 shareholders of all of the corresponding non-fundamental investment policy explainingFunds, the concept of
"limited" maturity. MML's investment objective and other fundamental investment
policiesProposal will not be affected byimplemented and the proposed changes.
The current fundamental investment policy is stated as follows:
"The fund invests, under normal market conditions, at least 80% of its net
assets in securitiesClass R1 12b-1 Fee and other investments with "limited" maturities, the interest on which is exempt from federal income tax."
The proposed revised fundamental investment policy would be stated as
follows:
"The fund invests, under normal market conditions, at least 80% of its net
assets in securities and other investments, the interest on which is exempt
from federal income tax."
For purposesClass R1 Administrative Services Fee will remain unchanged for all of the above policy, MFS defines "net assets" to mean MML's net
assets plus the amountFunds.
The Trustees of any borrowings for investment purposes.
The current non-fundamental investment policy explaining the concept of
"limited" maturity is stated as follows:
"Fixed income securities with limited maturities include securities with
remaining maturities of 10 years or less. Under normal market conditions,
the fund's dollar-weighted average maturity will not exceed 5 years."
The revised non-fundamental investment policy would be stated as follows:
"Under normal market conditions, the fund's dollar-weighted average
maturity will not exceed 5 years."
Shareholders should understandeach Fund unanimously recommend that the value of MML's bond investments
typically changes as interest rates fluctuate. During periods of rising
interest rates, the values of bonds generally decline. Conversely, during
periods of falling interest rates, the values of bonds generally rise. This
risk, also called "interest rate risk," is generally greater for funds
investing in bonds with longer maturities. Maturity refers to the length of a
bond's term. Dollar-weighted average maturity is the average of all the current
maturities of the individual bonds in a fund, taking into account the amount of
the fund's investment in each bond. The longer its dollar-weighted average
maturity, the more sensitive a fund will be to changes in interest rates, and
the greater potential for fluctuation or volatility in its share price. This
risk is called "maturity risk."
MFS does not anticipate that the proposed changes to MML's investment
policies as described above will materially change the way MML is managed or
the level of risk associated with an investment in MML. Under the revised
policies, MFS would be able to purchase individual bonds with remaining
maturities of greater than 10 years, which securities will be more sensitive to
changes in interest rates. As a result, MML may be subject to a greater extent
to interest rate risk and maturity risk, each of which are described in the
preceding paragraph. MML's portfolio as a whole, however, will continue to have
a dollar-weighted average maturity that normally will not exceed 5 years.
Therefore, MFS does not anticipate that the change to MML's non-fundamental
investment policy will materially change the overall exposure of the portfolio
to interest rate changes.
REQUIRED VOTE
Approval of this matter will require theyou vote of (i) 67 per centum or more of
the outstanding voting securities of MML present at MML's Meeting, if the
holders of more than 50 per centum of the outstanding voting securities of MML
are present or represented by proxy or (ii) more than 50 per centum of the
outstanding voting securities of MML, whichever is less.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS OF MML VOTE TO
APPROVE THE PROPOSAL.
FOR Proposal 1.
FUND INFORMATION
This section provides certain information about each Fund, including information about its investment adviser, principal underwriter and administrator, independent registered public accounting firm, executive
officers and the identity of persons holding of record or beneficially 5% or more than 5% of the outstanding sharesClass R1 Shares of any class of anya Fund.
INVESTMENT ADVISER, PRINCIPAL UNDERWRITER AND ADMINISTRATOR
Investment Adviser, Principal Underwriter and Administrator
Each Fund engages as itsFund’s investment adviser and administrator is MFS, a Delaware corporation with offices at 500 Boylston Street, Boston, Massachusetts 02116. Each Fund engages as itsThe Funds’ principal underwriter MFS Fund Distributors, Inc.
("MFD"),is MFD, a Delaware corporation with offices at 500 Boylston Street, Boston, Massachusetts 02116. MFS is a majority owned-owned subsidiary of Sun Life of Canada (U.S.) Financial Services Holdings, Inc., which in turn is a majority-owned subsidiary of Sun Life Financial (U.S.) Holdings, Inc., which has an address of 500 Boylston Street, Boston, Massachusetts 02116, which in turn02116. Sun Life Financial (U.S.) Holdings, Inc. is a wholly-owned subsidiary of Sun Life Assurance Company of Canada -- U.S.Canada-U.S. Operations Holdings, Inc., One Sun Life Executive Park, Wellesley Hills, Massachusetts 02481 ("(“Sun Life U.S. Operations"Operations”). Sun Life U.S. Operations is a wholly-owned subsidiary of Sun Life Financial Corp., which has an address of 150 King Street West, Toronto, Canada MSH 1J9, and which in turn is a wholly-owned subsidiary of Sun Life Financial Inc.
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Independent Registered Public Accounting Firm and fiscal year end for
each Fund is listed below:
Interests of the applicable Independent Registered Public Accounting
Firm are expected to be present at the Meeting and will have an opportunity to
make a statement if they desire to do so. Such representatives also are
expected to be available to respond to appropriate questions.
To the extent required by applicable regulations, pre-approval by the Audit
Committee of the Board is needed for all audit and permissible non-audit
services rendered by the Independent Registered Public Accounting Firm to each
Fund and all permissible non-audit services rendered by the Independent
Registered Public Accounting Firm to MFS and any entity controlling, controlled
by or under common control with MFS that provides ongoing services to a Fund
(including MFS Service Center, Inc.) (each, a "Service Affiliate") if the
services relate directly to the operations and financial reporting of such
Fund. Pre-approval is currently on an engagement-by-engagement basis. In the
event pre-approval of such services is necessary between regular meetings of
the Audit Committee and it is not practical to wait to seek pre-approval at the
next regular meeting of the Audit Committee, pre-approval of such services may
be referred to the Chair of the Audit Committee; provided that the Chair may
not pre-approve any individual engagement for such services exceeding $50,000
or multiple engagements for such services in the aggregate exceeding $100,000
between such regular meetings of the Audit Committee. Any engagement
pre-approved by the Chair between regular meetings of the Audit Committee shall
be presented for ratification by the entire Audit Committee at its next
regularly scheduled meeting.
Certain Persons
Schedule A attached hereto includes tables that set forth for each Fund (in
order of fiscal year end), for each Fund's two most recent fiscal years, the
fees billed by each Fund's Independent Registered Public Accounting Firm for
(a) all audit and non-audit services provided directly to the Fund and (b)
those non-audit services provided to the Fund's Service Affiliates that relate
directly to the Fund's operations and financial reporting under the following
captions:
(i) Audit Fees -- fees related to the audit and review of the financial
statements included in annual reports and registration statements, and
other services that are normally provided in connection with statutory
and regulatory filings or engagements.
(ii) Audit-Related Fees -- fees related to assurance and related services
that are reasonably related to the performance of the audit or review
of financial statements, but not reported under "Audit Fees,"
including accounting consultations, agreed-upon procedure reports,
attestation reports, comfort letters and internal control reviews.
(iii) Tax Fees -- fees associated with tax compliance, tax advice and tax
planning, including services relating to the filing or amendment of
federal, state or local income tax returns, regulated investment
company qualification reviews and tax distribution and analysis
reviews.
(iv) All Other Fees -- fees for products and services provided to the Fund
by the Independent Registered Public Accounting Firm other than those
reported under "Audit Fees," "Audit-Related Fees" and "Tax Fees."
Schedule A attached hereto also sets forth the aggregate fees billed by each
Independent Registered Public Accounting Firm, for each Fund's two most recent
fiscal years, for non-audit services rendered to each Fund and to each Fund's
Service Affiliates.
The Audit Committee has considered whether the provision by a Fund's
Independent Registered Public Accounting Firm of non-audit services to the
Fund's Service Affiliates that were not pre-approved by the Audit Committee
(because such services were provided prior to the effectiveness of SEC rules
requiring pre-approval or because such services did not relate directly to the
operations and financial reporting of the Fund) was compatible with maintaining
the independence of the Independent Registered Public Accounting Firm as the
Fund's principal auditor.
EXECUTIVE OFFICERS
The following table provides information about the current executive officers
of each Trust, 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. 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.
PRINCIPAL OCCUPATIONS
POSITION(s) HELD DURING THE PAST FIVE YEARS
NAME, DATE OF BIRTH WITH SERIES OFFICER SINCE(1) & DIRECTORSHIPS(2)
- ------------------- ---------------- ---------------- ---------------------------
OFFICERS
Robert J. Manning(3) President February 2004 Massachusetts Financial Services
(born 10/20/63) Company, Chief Executive Officer,
President, Chief Investment Officer
and Director
James R. Bordewick, Jr.(3) Assistant September 1990 Massachusetts Financial Services
(born 03/06/59) Secretary and Company, Senior Vice President and
Assistant Clerk Associate General Counsel
Jeffrey N. Carp(3) Secretary and September 2004 Massachusetts Financial Services
(born 12/01/56) Clerk Company, Senior Vice President,
General Counsel and Secretary
(since April 2004); Hale and Dorr
LLP (law firm) (prior to April
2004)
Stephanie A. DeSisto(3) Assistant May 2003 Massachusetts Financial Services
(born 10/01/53) Treasurer Company, Vice President (since April
2003); Brown Brothers Harriman &
Co., Senior Vice President
(November 2002 to April 2003); ING
Groep N.V./Aeltus Investment
Management, Senior Vice President
(prior to November 2002)
James F. DesMarais(3) Assistant September 2004 Massachusetts Financial Services
(born 03/09/61) Secretary and Company, Assistant General Counsel
Assistant Clerk
Richard M. Hisey(3) Treasurer August 2002 Massachusetts Financial Services
(born 08/29/58) Company, Senior Vice President (since
July 2002); The Bank of New York,
Senior Vice President (September
2000 to July 2002); Lexington
Global Asset Managers, Inc.,
Executive Vice President and Chief
Financial Officer (prior to
September 2000); Lexington Funds,
Chief Financial Officer (prior to
September 2000)
Brian T. Hourihan(3) Assistant September 2004 Massachusetts Financial Services
(born 11/11/64) Secretary and Company, Vice President, Senior
Assistant Clerk Counsel and Assistant Secretary (since
June 2004); Affiliated Managers Group,
Inc., Chief Legal Officer/Centralized
Compliance Program (January to April
2004); Fidelity Research & Management
Company, Assistant General Counsel
(prior to January 2004)
Ellen Moynihan(3) Assistant April 1997 Massachusetts Financial Services
(born 11/13/57) Treasurer Company, Vice President
Frank L. Tarantino Independent June 2004 MFS Family of Funds, Independent Chief
(born 03/07/44) Chief Compliance Compliance Officer; CRA Business
Officer Strategies Group (consulting
services), Executive Vice President
(April 2003 to June 2004); David L.
Babson & Co. (investment adviser),
Managing Director, Chief
Administrative Officer and Director
(February 1997 to March 2003)
James O. Yost(3) Assistant September 1990 Massachusetts Financial Services
(born 06/12/60) Treasurer Company, Senior Vice President
- ----------
(1) Date first appointed to serve as an officer of a Trust. Each officer has served continuously since
appointment.
(2) Directorships or trusteeships of companies required to report to the SEC (i.e., "public companies").
(3) "Interested person" of the Trust within the meaning of the 1940 Act, as a result of position with MFS.
Each Trust's officers hold comparable positions with the 97 funds in the MFS
Family of Funds, and with certain affiliates of MFS. The address of each
officer is c/o MFS, 500 Boylston Street, Boston, Massachusetts 02116.
INTERESTS OF CERTAIN PERSONS
Schedule BIV attached hereto sets forth, as of January 18, 2005, to the best knowledge of each Fund, the shareholders who owned of record or beneficially owned5% or more than 5%of a Fund’s outstanding Class R1 Shares as of the outstanding sharesclose of business on December 3, 2007.
As of December 3, 2007, the officers and directors of the Funds, as a group, owned less than 1% of each class of such Fund.
LITIGATION
Since December 2003, MFS, MFD, MFS Service Center, Inc., MFS Corporation
Retirement Committee, Sun Life Financial Inc., various MFS funds and Trusts,
certain current and/or former Trustees of the trusts of which these MFS funds
are series and certain officers of MFS have been named as defendants in
multiple lawsuits filed in federal and state courts. Of these lawsuits, four
are derivative actions that have been brought on behalf of all the MFS funds
and name among the defendants the following Trustees who are nominees: Mr.
Lawrence H. Cohn, M.D., Mr. William R. Gutow, Mr. J. Atwood Ives, Mr. Lawrence
T. Perera and Mr. J. Dale Sherratt. The derivative action relating to market
timing and related matters, styled as Hammerslough v. Massachusetts Financial
Services Company, et al., U.S.D.C. (D. Md.), MDL 1586, is a consolidated action
before the United States District Court for the District of Maryland, in the
multi-district litigation of market timing and related claims involving several
other fund complexes (In re Mutual Funds Investment Litigation (Alger,
Columbia, Janus, MFS, One Group, Putnam, Allianz Dresdner), No. 1:04-md-15863
(consolidation began March 19, 2004)). The plaintiffs in this consolidated
action generally seek injunctive relief including removal of the named
Trustees, adviser and distributor, rescission of contracts and 12b-1 Plans,
disgorgement of fees and profits, monetary damages, punitive damages,
attorney's fees and costs and other equitable and declarative relief. The other
three derivative lawsuits allege improper brokerage allocation practices and
excessive compensation and are pending in the United States District Court for
the District of Massachusetts: Forsythe v. Sun Life Financial Inc., et al., No.
04cv10584 (GAO) (instituted on March 25, 2004); Eddings v. Sun Life Financial
Inc., et al., No. 04cv10764 (GAO) (instituted on April 15, 2004); and Koslow v.
Sun Life Financial Inc., et al., U.S.D.C. (D. Mass.), No. 04cv11019 (instituted
on May 20, 2004). The plaintiffs in these lawsuits generally seek compensatory
damages, punitive damages, recovery of fees, rescission of contracts, an
accounting, restitution, declaratory relief, equitable and/or injunctive relief
and attorney's fees and costs. These various lawsuits generally allege that
some or all of the defendants (i) permitted or acquiesced in market timing
and/or late trading in some of the MFS funds, inadequately disclosed MFS'
internal policies concerning market timing and such matters and received
excessive compensation as fiduciaries to the MFS funds, or (ii) permitted or
acquiesced in the improper use of fund assets by MFS to support the
distribution of MFS fund shares and inadequately disclosed MFS' use of fund
assets in this manner. The actions assert that some or all of the defendants
violated the federal securities laws, including the Securities Act of 1933, the
Securities Exchange Act of 1934, the Investment Company Act of 1940, the
Investment Advisers Act of 1940 and the Employee Retirement Income Security Act
of 1974, as well as fiduciary duties and other violations of common law.
Insofar as any of the actions is appropriately brought derivatively on behalf
of any of the MFS funds, any recovery will inure to the benefit of the MFS
funds.
Fund’s outstanding Class R1 Shares.
FURTHER INFORMATION ABOUT VOTING AND THE SPECIAL MEETING
MANNER OF VOTING PROXIES
Outstanding Shares, Method of Tabulation and Quorum
Schedule III attached hereto sets forth, as of the close of business as of December 10, 2007, the total number of Class R1 Shares that were issued and outstanding for each Fund. Shareholders of record at the close of business on December 10, 2007 will be entitled to one vote for each dollar of net asset value held on that date (i.e., the number of shares owned times the net asset value per share), with fractional amounts voting proportionately. Shares representing a majority of the voting power of the outstanding Class R1 Shares of a Fund entitled to be cast at the Special Meeting that are present in person or represented by proxy constitute a quorum with respect to that Fund.
6
Manner of Voting Proxies
All proxies received by management will be voted on all matters presented at the Special Meeting, and if not limited to the contrary, will be voted FOR the election
of Lawrence H. Cohn, M.D., David H. Gunning, William R. Gutow, Michael Hegarty,
J. Atwood Ives, Amy B. Lane, Robert J. Manning, Lawrence T. Perera, Robert C.
Pozen, J. Dale Sherratt and Laurie J. Thomsen as Trustees of the Trust (if
still available for election), FOR the proposalProposal to make non- fundamental an
investment policy of MIG and FOR the proposal to revise a fundamental
investment policy of MML.amend each Fund’s Distribution Plan. All proxies received, including proxies that reflect (i) broker non-votes (i.e., shares held by brokers or nominees as to which (a) instructions have not been received from the beneficial owners or the persons entitled to vote, and (b) the broker or nominee does not have discretionary voting power on a particular matter), (ii) abstentions or (iii) the withholding of authority to vote, will be counted as shares that are present on a particular matter for purposes of determining the presence of a quorum for that matter. A majority of
a Fund's outstanding shares entitled to be cast at the Meeting that are present
in person or represented by proxy constitutes a quorum. With respect to the
election of Trustees, neither broker non-votes nor abstentions nor withholding
authority to vote have any effect on the outcome of the voting. With respect to
the proposal to make non-fundamental an investment policy of MIG and with
respect to the proposal to revise a fundamental investment policy of MML,
brokerBroker non-votes, abstentions and withholding authority to vote will all will have the effect of a vote AGAINST the applicable proposal.
Each shareholder of a Fund is entitled to one vote for each dollar of net
asset value (number of shares of the Fund owned by such shareholder, times net
asset value per share) of the Fund that such shareholder owns at the close of
business on January 18, 2005, on each matter on which the shareholder is
entitled to vote. Each fractional dollar amount is entitled to a proportionate
fractional vote.
Proposal.
Each Fund will reimburse the record holders of its sharesRecord Holders for their expenses incurred in sending proxy materialmaterials to, and obtaining voting instructions from, beneficial owners.
Each
Solicitation of Proxies
In addition to soliciting proxies by mail, the Trustees of your Funds and employees of MFS, MFS Fund knowsDistributors, Inc., and MFS Service Center, Inc. may solicit proxies in person or by telephone. In addition, the Funds have retained, at their own expense, Broadridge Financial Solutions, Inc., 60 Research Road, Hingham, Massachusetts 02043, to aid in the solicitation of no other matters to be brought beforeinstructions for nominee and registered accounts for a fee of approximately $12,000 in the Meeting. If,
however, because of any unexpected occurrence, any nominee is not availableaggregate, plus reasonable out-of-pocket expenses for election or if any other matters properly come before the Meeting, it is each
Fund's intention that proxies not limited to the contraryproxy solicitation services, which will be voted in
accordance with the judgment of the persons named in the enclosed form of
proxy.
SOLICITATION OF PROXIES
The procedures for voting proxies solicited by telephone or submittedpaid on a proportionate basis by the Internet orFunds.
The Funds may also arrange to have votes recorded by automated telephone service aretelephone. The telephonic voting procedure is designed to authenticate shareholders'shareholders’ identities, to allow themshareholders to authorize the voting of their shares in accordance with their instructions and to confirm that their instructions have been properly recorded. If these procedures were subject to a successful
legal challenge, such votesShareholders would not be counted at the meeting of
shareholders. The Funds are unaware of any such challenge at this time.
If shareholders' proxies are solicited by telephone, shareholders will be
called at the phone number that the Fund (or a shareholder's financial service
firm) has in its records for their accounts, and will be asked for their Social Security numbernumbers or other identifying information. The shareholders willwould then be given an opportunity to authorize their proxies to vote their shares at the meeting
of shareholdersSpecial Meeting in accordance with their instructions. To ensure that the shareholders'shareholders’ instructions have been recorded correctly, they will also receive a confirmation of their instructions in the mail. A special toll-free number will be available in casethe event the information contained in the confirmation is incorrect.
INSTRUCTIONS FOR VOTING PROXIES
Shareholders also have the opportunity to submit their voting instructions via the Internet as directed on your proxy card(s). The giving of such a proxy will not affect your right to vote in person should you decide to attend the Special Meeting. To use the Internet, you will need the “control” number that appears on your proxy card(s). The Internet voting procedures, which are included on the Internet address on your proxy card(s), are designed to authenticate shareholder identities, to allow shareholders to give their voting instructions, and to confirm that shareholders’ instructions have been recorded properly.
Instructions for Voting Proxies
The giving of a proxy will not affect a shareholder'sshareholder’s right to vote in person should the shareholder decide to attend the Special Meeting. To vote by mail, please mark, sign, date and return the enclosed proxy cardcard(s) following the instructions printed on the card.card(s). To use the Internet, please access the Internet address listed on your proxy cardcard(s) and follow the instructions on the website. To record
your voting instructions via automated telephone service, call the toll-free
number listed on your proxy card. Shareholders voting via the Internet should understand that there may be costs associated with electronic access, such as usage charges from Internet access providers and telephone companies, that must be borne by the shareholders. SUBMISSION OF PROPOSALS
EachTo record your voting instructions via automated telephone service, please call the toll-free number listed on the enclosed proxy card(s).
7
Revocation of Proxies
Proxies, including proxies given by telephone or via the Internet, may be revoked at any time before they are voted either (i) by a written revocation received by the Secretary of the applicable Fund, (ii) by properly executing a later-dated proxy, or (iii) by attending the Special Meeting and voting in person.
Adjournment
With respect to each Fund, if the necessary quorum to transact business or sufficient votes in favor of the Proposal are not received by the time scheduled for the Special Meeting, the persons named as proxies may propose adjournments of the Special Meeting to permit further solicitation of proxies with respect to the Fund. Any adjournment will require the affirmative vote of a majority of the votes cast on the question in person or by proxy at the session of the Special Meeting to be adjourned. The persons named as proxies will vote in favor of such adjournment those proxies which they are entitled to vote in favor of the proposal. They will vote against any such adjournment those proxies required to be voted against the proposal. They will not vote any proxy that directs them to abstain from voting on the proposal. The applicable Funds will pay the costs of any additional solicitation and of any adjourned session.
Submission of Proposals
Each Fund is a (or is part of aa) Massachusetts business trust, and as such is not required to hold annual meetings of shareholders. However, the Trustees may from time to time schedule special meetings. Shareholder proposals for inclusion in a Fund'sFund’s proxy statement for any subsequent meeting must be received by the applicable Fund a reasonable period of time prior to any such meeting.
ADDITIONAL INFORMATION
Because all shareholders
Cost of Funds that are series of the same Trust will vote
together as a single class with respect to the election of Trustees, the
Meeting of shareholders of each Fund is called to be held at the same time as
the Meeting of shareholders of each of the other Funds. It is anticipated that
all Meetings will be held simultaneously.
With regard to a proposal other than the election of Trustees, if any
shareholder at the Meeting objects to the holding of simultaneous Meetings and
moves for an adjournment of that Meeting to a time promptly after the
simultaneous Meetings, the persons named as proxies will vote in favor of such
adjournment with respect to such other proposals.
Proxy Solicitation
The expense of the preparation, printing and mailing of the enclosed form of proxy, the Notice, and this Proxy Statement, and any tabulation costs, will be borne on a proportional basis by the Funds.
Other Business
Each Fund knows of no other matters to be brought before the Special Meeting. If, however, because of any unexpected occurrence, any matters properly come before the Special Meeting, it is a 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(s) of proxy.
Additional Information
The Special Meeting of shareholders of your Fund is called to be held at the same time as the meetings of shareholders of certain of the other Funds. It is anticipated that all Special Meetings will be held simultaneously. If any shareholder at the Special Meeting objects to the holding of simultaneous Special Meetings and moves for an adjournment of that Special Meeting to a time promptly after the simultaneous Special Meetings, the persons named as proxies will vote in favor of such adjournment.
Only one copy of this Proxy Statement may be mailed to a Record Holder’s household, even if more than one person in a household is a Fund shareholder of record,Record Holder, unless the Fund has received contrary instructions from one or more of the shareholders. If you need additional copies of this Proxy Statement and you are the holder of
recordRecord Holder of your shares, please contact MFS Service Center, Inc. at 800-225-2606.1-800-225-2606. If your shares are held in broker street name, please contact your financial service firmintermediary to obtain additional copies of this proxy statement.Proxy Statement. If in the future you do not want the mailing of proxy statements to be
8
combined with those for other members of your household, or if, within your household, you are receiving multiple copies of this Proxy Statement and want the mailings to be combined with those for other members of your household, contact MFS Service Center, Inc.Inc in writing at 500 Boylston Street, Boston, Massachusetts 02116, or by telephone at 800-225-2606,1-800-225-2606, or contact your financial service firm.
intermediary.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY
February 3, 2005
9
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Schedule I:
Actual and Pro Forma Fund Expenses
MFS Aggressive Growth Allocation Fund (as of fiscal year ended May 31, 2007)
The Fund is a Fund-of-Funds. The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. In addition to the fees and expenses which you bear directly, you will indirectly bear the Fund’s pro rata share of the fees and expenses of the underlying funds in which the fund invests. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements, and a weighted average of the total annual operating expenses (as reported in each underlying fund’s most recent shareholder report) of, and the fee (if any) charged by the underlying funds in which the Fund invested during the Fund’s most recently completed fiscal year. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the Class R1 annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
| Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3)(4) | Acquired (Underlying) Fund Fees and Expenses(3) | Total Annual Fund Operating Expenses(4) | ||||||||||
Class R1 | ||||||||||||||
Actual Expenses | N/A | 0.75 | % | 0.38 | % | 0.92 | % | 2.05 | % | |||||
Pro Forma Expenses | N/A | 1.00 | % | 0.03 | % | 0.92 | % | 1.95 | % |
| (1) | The Fund |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
I-1
| (3) | The Fund |
| (4) | MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.45% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.10% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least September 30, 2008. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is October 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 208 | $ | 643 | $ | 1,103 | $ | 2,379 | ||||
Class R1 (Pro Forma) | $ | 198 | $ | 612 | $ | 1,052 | $ | 2,275 | ||||
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MFS Bond Fund (as of fiscal year ended April 30, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | Fee Reductions(4) | Net Expenses(4) | |||||||||||||
Class R1 | ||||||||||||||||||
Actual Expenses | 0.39 | % | 0.75 | % | 0.59 | % | 1.73 | % | (0.09 | )% | 1.64 | % | ||||||
Pro Forma Expenses | 0.39 | % | 1.00 | % | 0.24 | % | 1.63 | % | (0.09 | )% | 1.54 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.39% annually of the first $1.1 billion of the Fund’s average daily net assets, and 0.38% annually in excess of $1.1 billion of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund |
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| (4) | MFS has agreed in writing to reduce its management fee to 0.30% annually of the Fund’s average daily net assets. MFS has agreed in writing to maintain this management fee reduction until February 28, 2009, as part of its settlement with the New York |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is September 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 167 | $ | 532 | $ | 926 | $ | 2,030 | ||||
Class R1 (Pro Forma) | $ | 157 | $ | 501 | $ | 874 | $ | 1,921 | ||||
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MFS Cash Reserve Fund (as of fiscal year ended August 31, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | Fee Reductions(4) | Net Expenses(4) | |||||||||||||
Class R1 | ||||||||||||||||||
Actual Expenses | 0.55 | % | 0.75 | % | 0.63 | % | 1.93 | % | (0.40 | )% | 1.53 | % | ||||||
Pro Forma Expenses | 0.55 | % | 1.00 | % | 0.28 | % | 1.83 | % | (0.40 | )% | 1.43 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.55% annually of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund |
| (4) | Prior to March 1, 2004, MFS agreed in writing to reduce its management fee to 0.45% annually of the Fund’s average daily net assets. Effective March 1, 2004, MFS agreed in writing to reduce its management |
I-5
fee to 0.15% annually of the Fund’s average daily net assets. MFS has agreed in writing to maintain this additional management fee reduction until February 28, 2009 as part of its settlement with the New |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is January 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 156 | $ | 541 | $ | 958 | $ | 2,119 | ||||
Class R1 (Pro Forma) | $ | 146 | $ | 511 | $ | 906 | $ | 2,012 | ||||
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MFS Conservative Allocation Fund (as of fiscal year ended May 31, 2007)
The Fund is a Fund-of-Funds. The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. In addition to the fees and expenses which you bear directly, you will indirectly bear the Fund’s pro rata share of the fees and expenses of the underlying funds in which the Fund invests. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements, and a weighted average of the total annual operating expenses (as reported in each underlying fund’s most recent shareholder report) of, and the fee (if any) charged by the underlying funds in which the Fund invested during the Fund’s most recently completed fiscal year. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the Class R1 annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3)(4) | Acquired (Underlying) Fund Fees and Expenses(3) | Total Annual Fund Operating Expenses(4) | ||||||||||
Class R1 | ||||||||||||||
Actual Expenses | N/A | 0.75 | % | 0.41 | % | 0.59 | % | 1.75 | % | |||||
Pro Forma Expenses | N/A | 1.00 | % | 0.06 | % | 0.59 | % | 1.65 | % |
| (1) | The Fund |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00% |
| (3) | The Fund |
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through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.45% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.10% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least September 30, 2008. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is October 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 178 | $ | 551 | $ | 949 | $ | 2,062 | ||||
Class R1 (Pro Forma) | $ | 168 | $ | 520 | $ | 897 | $ | 1,955 | ||||
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MFS Core Equity Fund (as of fiscal year ended August 31, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses(4) | |||||||||
Class R1 | ||||||||||||
Actual Expenses | 0.59 | % | 0.75 | % | 0.61 | % | 1.95 | % | ||||
Pro Forma Expenses | 0.59 | % | 1.00 | % | 0.26 | % | 1.85 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.65% annually of the first $500 million of the Fund’s average daily net assets, and 0.55% in excess of $500 million of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund |
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| (4) | MFS has agreed in writing to bear the Fund’s expenses such that the “Total Annual Fund |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is January 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 198 | $ | 612 | $ | 1,052 | $ | 2,275 | ||||
Class R1 (Pro Forma) | $ | 188 | $ | 582 | $ | 1,001 | $ | 2,169 | ||||
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MFS Core Growth Fund (as of fiscal year ended August 31, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | Fee Reductions(4) | Net Expenses(4) | |||||||||||||
Class R1 | ||||||||||||||||||
Actual Expenses | 0.69 | % | 0.75 | % | 0.58 | % | 2.02 | % | (0.04 | )% | 1.98 | % | ||||||
Pro Forma Expenses | 0.69 | % | 1.00 | % | 0.23 | % | 1.92 | % | (0.04 | )% | 1.88 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.75% annually of the first $1 billion of the Fund’s average daily net assets, 0.65% of the next $1.5 billion of the Fund’s average daily net assets, and 0.60% annually in excess of $2.5 billion of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund |
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| (4) | MFS has agreed in writing to reduce its management fee to 0.65% annually of the first $1 billion of the Fund’s average daily net assets. MFS has agreed in writing to maintain this management fee reduction until February 28, 2009 as part of its settlement with the New York Attorney General concerning market timing and related matters. MFS has also agreed in writing to bear the Fund’s expenses such that the “Total Annual Fund |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is January 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 201 | $ | 629 | $ | 1,084 | $ | 2,344 | ||||
Class R1 (Pro Forma) | $ | 191 | $ | 598 | $ | 1,032 | $ | 2,239 | ||||
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MFS Emerging Growth Fund (as of fiscal year ended November 31, 2006)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently reported fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | Fee Reductions(4) | Net Expenses(4) | |||||||||||||
Class R1 | ||||||||||||||||||
Actual Expenses | 0.74 | % | 0.75 | % | 0.65 | % | 2.14 | % | (0.03 | )% | 2.11 | % | ||||||
Pro Forma Expenses | 0.74 | % | 1.00 | % | 0.30 | % | 2.04 | % | (0.03 | )% | 2.01 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.75% annually of the first $2.5 billion of the Fund’s average daily net assets, and 0.70% in excess of $2.5 billion of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund |
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| (4) | MFS has agreed in writing to reduce its management fee to 0.60% annually in excess of $2.5 billion of the Fund’s average daily net assets. MFS has agreed in writing to maintain this management fee reduction until February 28, 2009 as part of its settlement with the New York Attorney General concerning market timing and related matters. |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is April 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 214 | $ | 664 | $ | 1,144 | $ | 2,468 | ||||
Class R1 (Pro Forma) | $ | 204 | $ | 634 | $ | 1,093 | $ | 2,364 | ||||
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MFS Global Equity Fund (as of fiscal year ended October 31, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | |||||||||
Class R1 | ||||||||||||
Actual Expenses | 0.90 | % | 0.75 | % | 0.66 | % | 2.31 | % | ||||
Pro Forma Expenses | 0.90 | % | 1.00 | % | 0.31 | % | 2.21 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.90% annually of the first $1 billion of the Fund’s average daily net assets, 0.75% annually of the next $1 billion of the Fund’s average daily net assets, and 0.65% annually in excess of $2 billion of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund |
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Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is March 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 234 | $ | 721 | $ | 1,235 | $ | 2,646 | ||||
Class R1 (Pro Forma) | $ | 224 | $ | 691 | $ | 1,185 | $ | 2,544 | ||||
I-16
MFS Global Growth Fund (as of fiscal year ended October 31, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | |||||||||
Class R1 | ||||||||||||
Actual Expenses | 0.90 | % | 0.75 | % | 0.68 | % | 2.33 | % | ||||
Pro Forma Expenses | 0.90 | % | 1.00 | % | 0.33 | % | 2.23 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.90% annually of the first $1 billion of the Fund’s average daily net assets, 0.75% annually of the next $1 billion of the Fund’s average daily net assets, and 0.65% annually in excess of $2 billion of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund |
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Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is March 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 236 | $ | 727 | $ | 1,245 | $ | 2,666 | ||||
Class R1 (Pro Forma) | $ | 226 | $ | 697 | $ | 1,195 | $ | 2,622 | ||||
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MFS Global Total Return Fund (as of fiscal year ended October 31, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | Fee Reductions(4) | Net Expenses(4) | |||||||||||||
Class R1 | ||||||||||||||||||
Actual Expenses | 0.84 | % | 0.75 | % | 0.62 | % | 2.21 | % | (0.16 | )% | 2.05 | % | ||||||
Pro Forma Expenses | 0.84 | % | 1.00 | % | 0.27 | % | 2.11 | % | (0.16 | )% | 1.95 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.84% annually of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund |
| (4) | MFS has agreed in writing to reduce its management fee to 0.75% annually of the first $500 million of the Fund’s average daily net assets, and 0.70% annually in excess of $1 billion of the Fund’s average daily net |
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assets. This written agreement will remain in effect until modified by the Fund’s Board of Trustees. In addition, MFS has agreed in writing to bear the Fund’s expenses such that the “Total Annual Fund Operating Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 2.05% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Total Annual Fund Operating Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 1.95% annually for Class R1 shares. This written agreement excludes taxes, extraordinary expenses, brokerage and transactions costs, and investment-related expenses and will continue until modified by the Fund’s Board of Trustees. |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is March 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 208 | $ | 643 | $ | 1,103 | $ | 2,379 | ||||
Class R1 (Pro Forma) | $ | 198 | $ | 612 | $ | 1,052 | $ | 2,275 | ||||
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MFS Government Securities Fund (as of fiscal year ended February 28, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | Fee Reductions(4) | Net Expenses(4) | |||||||||||||
Class R1 | ||||||||||||||||||
Actual Expenses | 0.40 | % | 0.75 | % | 0.58 | % | 1.73 | % | (0.10 | )% | 1.63 | % | ||||||
Pro Forma Expenses | 0.40 | % | 1.00 | % | 0.23 | % | 1.63 | % | (0.10 | )% | 1.53 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.40% annually of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Net Expenses” would be lower. The column “Class R1 Actual Expenses” includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to reduce its management fee to 0.30% annually of the Fund’s average daily net assets. MFS has agreed in writing to maintain this management fee reduction until February 28, 2009, as |
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part of its settlement with the New |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is July 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 166 | $ | 528 | $ | 923 | $ | 2,027 | ||||
Class R1 (Pro Forma) | $ | 156 | $ | 498 | $ | 871 | $ | 1,918 | ||||
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MFS Growth Allocation Fund (as of fiscal year ended May 31, 2007)
The Fund is a Fund-of-Funds. The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. In addition to the fees and expenses which you bear directly, you will indirectly bear the Fund’s pro rata share of the fees and expenses of the underlying funds in which the fund invests. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements, and a weighted average of the total annual operating expenses (as reported in each underlying fund’s most recent shareholder report) of, and the fee (if any) charged by the underlying funds in which the Fund invested during the Fund’s most recently completed fiscal year. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the Class R1 annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3)(4) | Acquired (Underlying) Fund Fees and Expenses(3) | Total Annual Fund Operating Expenses(4) | ||||||||||
Class R1 | ||||||||||||||
Actual Expenses | N/A | 0.75 | % | 0.41 | % | 0.83 | % | 1.99 | % | |||||
Pro Forma Expenses | N/A | 1.00 | % | 0.06 | % | 0.83 | % | 1.89 | % |
| (1) | The Fund pays no management fee to MFS; however the underlying funds pay management fees to MFS which are included under “Acquired (Underlying) Fund Fees and Expenses.” |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Total Annual Fund Operating Expenses” would be lower. A portion of the expenses of the Fund may be paid by the underlying funds in which the Fund invests. The column “Class R1 Actual Expenses” also includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or |
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through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.45% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.10% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least September 30, 2008. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is October 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 202 | $ | 624 | $ | 1,073 | $ | 2,317 | ||||
Class R1 (Pro Forma) | $ | 192 | $ | 594 | $ | 1,021 | $ | 2,212 | ||||
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MFS High Income Fund (as of fiscal year ended January 31, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses(4) | |||||||||
Class R1 | ||||||||||||
Actual Expenses | 0.46 | % | 0.75 | % | 0.59 | % | 1.80 | % | ||||
Pro Forma Expenses | 0.46 | % | 1.00 | % | 0.24 | % | 1.70 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.46% annually of the first $1.4 billion of the Fund’s average daily net assets, and 0.44% annually in excess of $1.4 billion of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Total Annual Fund Operating Expenses” would be lower. “Other Expenses” include the estimated payment of a portion of the transfer-agent-related expenses of the MFS funds that invest in the Fund. The column “Class R1 Actual Expenses” includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
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| (4) | MFS has agreed in writing to reduce its management fee to 0.39% annually in excess of $1.4 billion of the Fund’s average daily net assets. MFS has agreed in writing to maintain this management fee reduction until February 28, 2009, as part of its settlement with the New York Attorney General concerning market timing and related matters. |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is June 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 183 | $ | 566 | $ | 975 | $ | 2,116 | ||||
Class R1 (Pro Forma) | $ | 173 | $ | 536 | $ | 923 | $ | 2,009 | ||||
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MFS Inflation-Adjusted Bond Fund
EXHIBIT 1
MFS FUNDS BOARD
NOMINATION AND COMPENSATION COMMITTEE CHARTER
(ADOPTED AS OF JULY 20, 2004)
(as of fiscal year ended October 31, 2007)
The Board (the "Board") of eachfollowing tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Trusts listedFund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in Appendix A hereto,the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | Fee Reductions(4) | Net Expenses(4) | |||||||||||||
Class R1 | ||||||||||||||||||
Actual Expenses | 0.50 | % | 0.75 | % | 1.77 | % | 3.02 | % | (1.42 | )% | 1.60 | % | ||||||
Pro Forma Expenses | 0.50 | % | 1.00 | % | 1.42 | % | 2.92 | % | (1.42 | )% | 1.50 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.50% annually of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Net Expenses” would be lower. The column “Class R1 Actual Expenses” includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to reduce its management fee to 0.35% annually of the Fund’s average daily net assets until modified by the Fund’s Board of Trustees. In addition, MFS has agreed in writing to bear the |
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Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.50% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.15% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least February 28, 2009. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, mayexcept that the Fund’s total operating expenses are assumed to be periodically updated (each a "Trust" and, collectively, the "Trusts"), has adopted this Charter to governFund’s “Net Expenses” for the activitiesperiod during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the Nominationtime period indicated, that the proposed distribution and Compensation Committee (the "Committee")service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is March 1, 2008, the date of the particular Board on behalfFund’s prospectus following the Fund’s most recent fiscal year end.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 163 | $ | 769 | $ | 1,401 | $ | 3,104 | ||||
Class R1 (Pro Forma) | $ | 153 | $ | 739 | $ | 1,352 | $ | 3,007 | ||||
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MFS International Diversification Fund (as of each series offiscal year ended May 31, 2007)
The Fund is a TrustFund-of-Funds. The following tables describe the fees and each Trust which is itself a single series (each
such series a "Fund"expenses that you may pay when you buy, redeem, and collectively, the "Funds"). This Charter applies
separately to each Trust and its particular Board and Committee, and shall be
interpreted accordingly.
STATEMENT OF PURPOSES AND RESPONSIBILITIES
The Committee is responsible for (i) determining requisite standards or
qualifications for nominees to serve as trustees on the Board, (ii) identifying
possible candidates to become membershold Class R1 shares of the BoardFund. In addition to the fees and expenses which you bear directly, you will indirectly bear the Fund’s pro rata share of the fees and expenses of the underlying funds in which the Fund invests. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements, and a weighted average of the total annual operating expenses (as reported in each underlying fund’s most recent shareholder report) of, and the fee (if any) charged by the underlying funds in which the Fund invested during the Fund’s most recently completed fiscal year. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the eventClass R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the Class R1 annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
| Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3)(4) | Acquired (Underlying) Fund Fees and Expenses(3) | Total Annual Fund Operating Expenses(4) | ||||||||||
Class R1 | ||||||||||||||
Actual Expenses | N/A | 0.75 | % | 0.40 | % | 1.10 | % | 2.25 | % | |||||
Pro Forma Expenses | N/A | 1.00 | % | 0.05 | % | 1.10 | % | 2.15 | % |
| (1) | The Fund pays no management fee to MFS; however the underlying funds pay management fees to MFS which are included under “Acquired (Underlying) Fund Fees and Expenses.” |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75% and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Total Annual Fund Operating Expenses” would be lower. A portion of the expenses of the Fund may be paid by the underlying funds in which the Fund invests. The column “Class R1 Actual Expenses” also includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services |
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Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.45% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.10% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least September 30, 2008. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a trustee
position5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is vacated or created and/or in contemplationeffect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is October 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 228 | $ | 703 | $ | 1,205 | $ | 2,585 | ||||
Class R1 (Pro Forma) | $ | 218 | $ | 673 | $ | 1,154 | $ | 2,483 | ||||
I-30
MFS International New Discovery Fund (as of fiscal year ended September 30, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | |||||||||
Class R1 | ||||||||||||
Actual Expenses | 0.93 | % | 0.75 | % | 0.58 | % | 2.26 | % | ||||
Pro Forma Expenses | 0.93 | % | 1.00 | % | 0.23 | % | 2.16 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.975% annually of the first $500 million of the Fund’s average daily net assets, and 0.925% annually in excess of $500 million of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Total Annual Fund Operating Expenses” would be lower. “Other Expenses” include the estimated payment of a portion of the transfer-agent-related expenses of the MFS funds that invest in the Fund. The column “Class R1 Actual Expenses” includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services |
I-31
fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to reduce its management fee to 0.850% annually in excess of $5 billion of the Fund’s average daily net assets, until modified by the Fund’s Board of Trustees. In addition, MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.75% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.40% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least January 31, 2009. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a shareholders'
meeting5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is February 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 229 | $ | 706 | $ | 1,210 | $ | 2,595 | ||||
Class R1 (Pro Forma) | $ | 219 | $ | 676 | $ | 1,159 | $ | 2,493 | ||||
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MFS Lifetime Retirement Income Fund (as of fiscal year ended April 30, 2007)
The Fund is a Fund-of-Funds. The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. In addition to the fees and expenses which you bear directly, you will indirectly bear the Fund’s pro rata share of the fees and expenses of the underlying funds in which the Fund invests. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements, and a weighted average of the total annual operating expenses (as reported in each underlying fund’s most recent shareholder report) of, and the fee (if any) charged by the underlying funds in which the Fund invested during the Fund’s most recently completed fiscal year. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the Class R1 annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly from Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3)(4) | Acquired (Underlying) Fund Fees and Expenses(3) | Total Annual Fund Operating Expenses(4) | Fee Reductions(4) | Net Expenses(4) | ||||||||||||||
Class R1 | ||||||||||||||||||||
Actual Expenses | N/A | 0.75 | % | 3.74 | % | 0.56 | % | 5.05 | % | (3.29 | )% | 1.76 | % | |||||||
Pro Forma Expenses | N/A | 1.00 | % | 3.39 | % | 0.56 | % | 4.95 | % | (3.29 | )% | 1.66 | % |
| (1) | The Fund pays no management fee to MFS; however the underlying funds pay management fees to MFS which are included under “Acquired (Underlying) Fund Fees and Expenses.” |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75% and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Net Expenses” would be lower. A portion of the |
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expenses of the Fund may be paid by the underlying funds in which the Fund invests. The column “Class R1 Actual Expenses” also includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.45% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.10% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least August 31, 2008. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at which one or more trustees isthe end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be elected, and (iii) considering
and evaluating such candidates and recommending trustee nomineesthe Fund’s “Net Expenses” for the Board's approval.period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is September 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 179 | $ | 1,221 | $ | 2,262 | $ | 4,861 | ||||
Class R1 (Pro Forma) | $ | 169 | $ | 1,190 | $ | 2,211 | $ | 4,758 | ||||
I-34
MFS Lifetime 2010 Fund (as of fiscal year ended April 30, 2007)
The Fund is a Fund-of-Funds. The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. In addition to the Committee is responsible for recommending for approvalfees and expenses which you bear directly, you will indirectly bear the Fund’s pro rata share of the fees and expenses of the underlying funds in which the Fund invests. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements, and a weighted average of the total annual operating expenses (as reported in each underlying fund’s most recent shareholder report) of, and the fee (if any) charged by the Boardunderlying funds in which the structureFund invested during the Fund’s most recently completed fiscal year. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and levelsService (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of compensationthe Class R1 annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3)(4) | Acquired (Underlying) Fund Fees and Expenses(3) | Total Annual Fund Operating Expenses(4) | Fee Reductions(4) | Net Expenses(4) | ||||||||||||||
Class R1 | ||||||||||||||||||||
Actual Expenses | N/A | 0.75 | % | �� | 2.54 | % | 0.58 | % | 3.87 | % | (2.09 | )% | 1.78 | % | ||||||
Pro Forma Expenses | N/A | 1.00 | % | 2.19 | % | 0.58 | % | 3.77 | % | (2.09 | )% | 1.68 | % |
| (1) | The Fund pays no management fee to MFS; however the underlying funds pay management fees to MFS which are included under “Acquired (Underlying) Fund Fees and Expenses.” |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75% and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Net Expenses” would be lower. A portion of the expenses of the Fund may be paid by the underlying funds in which the Fund invests. The column “Class R1 |
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Actual Expenses” also includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.45% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.10% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least August 31, 2008. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other related benefitsdistributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be paid or providedthe Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is September 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 181 | $ | 989 | $ | 1,815 | $ | 3,964 | ||||
Class R1 (Pro Forma) | $ | 171 | $ | 959 | $ | 1,768 | $ | 3,877 | ||||
I-36
MFS Lifetime 2020 Fund (as of fiscal year ended April 30, 2007)
The Fund is a Fund-of-Funds. The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. In addition to the fees and expenses which you bear directly, you will indirectly bear the Fund’s pro rata share of the fees and expenses of the underlying funds in which the Fund invests. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements, and a weighted average of the total annual operating expenses (as reported in each underlying fund’s most recent shareholder report) of, and the fee (if any) charged by the Fundsunderlying funds in which the Fund invested during the Fund’s most recently completed fiscal year. The “Class R1 Pro Forma Expenses” are adjusted to Board members " ("Independent Trustees")
who are not "interested persons"give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the Trust, as definedClass R1 annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in Section 2(a)(19)future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3)(4) | Acquired (Underlying) Fund Fees and Expenses(3) | Total Annual Fund Operating Expenses(4) | Fee Reductions(4) | Net Expenses(4) | ||||||||||||||
Class R1 | ||||||||||||||||||||
Actual Expenses | N/A | 0.75 | % | 1.19 | % | 0.81 | % | 2.75 | % | (0.74 | )% | 2.01 | % | |||||||
Pro Forma Expenses | N/A | 1.00 | % | 0.84 | % | 0.81 | % | 2.65 | % | (0.74 | )% | 1.91 | % |
| (1) | The Fund pays no management fee to MFS; however the underlying funds pay management fees to MFS which are included under “Acquired (Underlying) Fund Fees and Expenses.” |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75% and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Net Expenses” would be lower. A portion of the expenses of the Fund may be paid by the underlying funds in which the Fund invests. The column “Class R1 |
I-37
Actual Expenses” also includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.45% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.10% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least August 31, 2008. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Investment Company Act of 1940, as amended (the "1940 Act").
ORGANIZATION AND GOVERNANCE
The Committee shall be comprised of allFund for the time periods indicated, you redeem your shares at the end of the Independent Trustees ontime periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Board, and shall not includeFund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any members whowritten fee reductions are not Independent Trustees.
One or more membersin effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the Committeetime period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is September 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 204 | $ | 783 | $ | 1,389 | $ | 3,026 | ||||
Class R1 (Pro Forma) | $ | 194 | $ | 752 | $ | 1,336 | $ | 2,914 | ||||
I-38
MFS Lifetime 2030 Fund (as of fiscal year ended April 30, 2007)
The Fund is a Fund-of-Funds. The following tables describe the fees and expenses that you may be designatedpay when you buy, redeem, and hold Class R1 shares of the Fund. In addition to the fees and expenses which you bear directly, you will indirectly bear the Fund’s pro rata share of the fees and expenses of the underlying funds in which the Fund invests. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements, and a weighted average of the total annual operating expenses (as reported in each underlying fund’s most recent shareholder report) of, and the fee (if any) charged by the Boardunderlying funds in which the Fund invested during the Fund’s most recently completed fiscal year. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the Committee's chair or co-chair, asproposed amendment to the case may be. The Committee may delegate
any portion of it authority or responsibilities to a sub-committee of one or
more members.
The Committee will not have regularly scheduled meetings. Committee meetings
shall be held asDistribution Plan and when the Committee or the Board determines necessary or
appropriate in accordance with the Trust's By-Laws. The Chairelimination of the Trustees,
the chair or vice-chairClass R1 annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3)(4) | Acquired (Underlying) Fund Fees and Expenses(3) | Total Annual Fund Operating Expenses(4) | Fee Reductions(4) | Net Expenses(4) | ||||||||||||||
Class R1 | ||||||||||||||||||||
Actual Expenses | N/A | 0.75 | % | 1.76 | % | 0.88 | % | 3.39 | % | (1.31 | )% | 2.08 | % | |||||||
Pro Forma Expenses | N/A | 1.00 | % | 1.41 | % | 0.88 | % | 3.29 | % | (1.31 | )% | 1.98 | % |
| (1) | The Fund pays no management fee to MFS; however the underlying funds pay management fees to MFS which are included under “Acquired (Underlying) Fund Fees and Expenses.” |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Net Expenses” would be lower. A portion of the expenses of the Fund may be paid by the underlying funds in which the Fund invests. The column “Class R1 |
I-39
Actual Expenses” also includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.45% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.10% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least August 31, 2008. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Committee or a majorityFund for the time periods indicated, you redeem your shares at the end of the memberstime periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the Committee are authorized to call a meetingtime period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is September 1, 2007, the date of the CommitteeFund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 211 | $ | 920 | $ | 1,652 | $ | 3,588 | ||||
Class R1 (Pro Forma) | $ | 201 | $ | 891 | $ | 1,604 | $ | 3,497 | ||||
I-40
MFS Lifetime 2040 Fund (as of fiscal year ended April 30, 2007)
The Fund is a Fund-of-Funds. The following tables describe the fees and send notice
thereof or directexpenses that such notice be sent.
A majorityyou may pay when you buy, redeem, and hold Class R1 shares of the membersFund. In addition to the fees and expenses which you bear directly, you will indirectly bear the Fund’s pro rata share of the Committee shall constitutefees and expenses of the underlying funds in which the Fund invests. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements, and a quorumweighted average of the total annual operating expenses (as reported in each underlying fund’s most recent shareholder report) of, and the fee (if any) charged by the underlying funds in which the Fund invested during the Fund’s most recently completed fiscal year. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the Class R1 annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3)(4) | Acquired (Underlying) Fund Fees and Expenses(3) | Total Annual Fund Operating Expenses(4) | Fee Reductions(4) | Net Expenses(4) | ||||||||||||||
Class R1 | ||||||||||||||||||||
Actual Expenses | N/A | 0.75 | % | 2.66 | % | 0.92 | % | 4.33 | % | (2.21 | )% | 2.12 | % | |||||||
Pro Forma Expenses | N/A | 1.00 | % | 2.31 | % | 0.92 | % | 4.23 | % | (2.21 | )% | 2.02 | % |
| (1) | The Fund pays no management fee to MFS; however the underlying funds pay management fees to MFS which are included under “Acquired (Underlying) Fund Fees and Expenses.” |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Net Expenses” would be lower. A portion of the expenses of the Fund may be paid by the underlying funds in which the Fund invests. The column “Class R1 |
I-41
Actual Expenses”also includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
| (4) | MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.45% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.10% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least August 31, 2008. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the transaction of businesstime periods indicated, you redeem your shares at any meetingthe end of the Committee.time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The action of a
majorityClass R1 pro forma expense examples also assume, during the entirety of the memberstime period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is September 1, 2007, the date of the Committee presentFund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 215 | $ | 1,112 | $ | 2,021 | $ | 4,347 | ||||
Class R1 (Pro Forma) | $ | 205 | $ | 1,083 | $ | 1,974 | $ | 4,264 | ||||
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MFS Limited Maturity Fund (as of fiscal year ended April 30, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | Fee Reductions(4) | Net Expenses(4) | |||||||||||||
Class R1 | ||||||||||||||||||
Actual Expenses | 0.40 | % | 0.75 | % | 0.60 | % | 1.75 | % | (0.15 | )% | 1.60 | % | ||||||
Pro Forma Expenses | 0.40 | % | 1.00 | % | 0.25 | % | 1.65 | % | (0.15 | )% | 1.50 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.40% annually of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Net Expenses” would be lower. “Other Expenses” include the estimated payment of a portion of the transfer-agent-related expenses of the MFS funds that invest in the Fund. The column “Class R1 Actual Expenses” includes in “Other Expenses” an annual retirement plan administration and service fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
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| (4) | Prior to March 1, 2004, MFS agreed in writing to reduce its management fee to 0.35% annually of the Fund’s average daily net assets. Effective March 1, 2004, MFS agreed in writing to reduce its management fee to 0.25% annually of the Fund’s average daily net assets. MFS has agreed in writing to maintain this additional management fee reduction until February 28, 2009, as part of its settlement with the New York Attorney General concerning market timing and related matters. |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a meeting at which a quorum
is present shall5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the actionFund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the Committee.time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The Committee may also take
action by written consent of a majoritycommencement date for the example is September 1, 2007, the date of the Committee members. The Committee
may meet by means of a telephone conference circuit or similar communications
equipment by means of which all persons participating in the meeting can hear
each other.
COMMITTEE DUTIES AND RESPONSIBILITIES
The duties and responsibilities of the Committee include:
Nomination
1. To determine requisite standards or qualifications for trustees nominees.
The Committee currently requires at minimum that trustee candidates have a
college degree or equivalent business and related industry experience.
2. To identify potential candidates to become members of the Board in the
event that a trustee position is vacated or created and/or in
contemplation of a shareholders' meeting at which one or more trustees is
to be elected. The Committee may consider candidates recommended by one or
more of the following sources: (i) the Fund'sFund’s current Trustees, (ii) the
Fund's officers, (iii) the Fund's investment adviser(s), (iv) the Fund's
shareholders (see 4. below) and (v) any other source the Committee deems
to be appropriate. The Committee may, but is not required to, retain a
third party search firm at the Fund's expense to identify potential
candidates.
3. To consider and evaluate candidates identified in 2. above and recommend
trustee nominees for the Board's approval. In considering and evaluating
candidates, the Committee may take into account a wide variety of factors,
including (but not limited to): (i) availability and commitment of a
candidate to attend meetings and perform his or her responsibilities on
the Board, (ii) relevant business and related industry experience, (iii)
educational background, (iv) financial expertise, (v) experience with
corporate governance matters, (vi) an assessment of the candidate's
ability, judgment and expertise, (vii) overall diversity of the Board's
composition, (viii) the percentage of the Board represented by Independent
Trustees and whether a candidate would qualify as an Independent Trustee
under the 1940 Act, and (ix) such other factors as the Committee deems
appropriate.
4. To consider and evaluate nominee candidates properly submitted by
shareholders on the same basis as it considers and evaluates candidates
recommended by other sources. Appendix B to this Charter, as it may be
amended from time to time by the Committee, sets forth procedures that
must be followed by shareholders to properly submit a nominee candidate to
the Committee (recommendations not properly submitted in accordance with
Appendix B will not be considered by the Committee).
Compensation
1. To recommend for approval by the Board the structure and levels of
compensation and any related benefits to be paid or provided by the Funds
to the Independent Trustees for their services on the Board and any
Committees of the Board.
2. In formulating the Committee's recommendations in 1. above, to
periodically (and at least annually) review and assess the compensation
and any related benefits paid or provided by the Funds to the Independent
Trustees based upon facts and circumstances applicable to the Funds,
relevant industry practice, the goal of attracting and retaining highly
qualified individuals to serve as Independent Trustees and such other
factors that the Committee deems appropriate.
General
1. To make such other recommendations and reports to the Board within the
scope of the Committee's functions.
2. To discharge any other duties or responsibilities delegated to the
Committee by the Board from time to time.
APPENDIX A TO EXHIBIT 1
TRUSTS COVERED BY THE CHARTER
(AS OF JULY 20, 2004)
MFS Series Trust I
MFS Series Trust II
MFS Series Trust III
MFS Series Trust IV
MFS Series Trust V
MFS Series Trust VI
MFS Series Trust VII
MFS Series Trust VIII
MFS Series Trust IX
MFS Series Trust X
MFS Series Trust XI
prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 163 | $ | 521 | $ | 909 | $ | 1,996 | ||||
Class R1 (Pro Forma) | $ | 153 | $ | 490 | $ | 856 | $ | 1,887 | ||||
I-44
Massachusetts Investors Growth Stock Fund (as of fiscal year ended November 30, 2006)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | |||||||||
Class R1 | ||||||||||||
Actual Expenses | 0.33 | % | 0.75 | % | 0.60 | % | 1.68 | % | ||||
Pro Forma Expenses | 0.33 | % | 1.00 | % | 0.25 | % | 1.58 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.33% annually of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Total Annual Fund Operating Expenses” would be lower. The column “Class R1 Actual Expenses” includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
I-45
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is April 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 171 | $ | 530 | $ | 913 | $ | 1,987 | ||||
Class R1 (Pro Forma) | $ | 161 | $ | 499 | $ | 860 | $ | 1,878 | ||||
I-46
Massachusetts Investors Trust MFS Charter Income Trust
MFS Government Limited Maturity Fund
MFS Government Markets Income Trust
MFS Government Securities Fund
MFS Growth Opportunities Fund
MFS Institutional Trust
MFS Intermediate Income Trust
MFS Multimarket Income Trust
MFS Municipal Income Trust
MFS Municipal Series Trust
MFS Special Value Trust
MFS Variable Insurance Trust
APPENDIX B TO EXHIBIT 1
PROCEDURES FOR SHAREHOLDERS TO SUBMIT NOMINEE CANDIDATES
(AS OF JULY 20, 2004)
A shareholder must follow(as of fiscal year ended December 31, 2006)
The following tables describe the following procedures in order to properly
submit a recommendation for a trustee nominee for the Committee's
consideration:
1. The shareholder must submit any such recommendation in writing to the
applicable Trust(s), to the attention of the Secretary, at the address of
the principal executive offices of the Trust(s).
2. The shareholder recommendation must include, with respect to each
applicable Trust:
(i) a statement in writing setting forth (A) the name, date of birth,
business addressfees and residence address of the person recommended by
the shareholder (the "candidate");expenses that you may pay when you buy, redeem, and (B) whether the recommending
shareholder believes that the candidate is or will be an
"interested person" of the Trust (as defined in the Investment
Company Act of 1940, as amended) and, if not an "interested
person," information regarding the candidate that will be
sufficient for the Trust to make such determination and, if
applicable, similar information regarding whether the candidate
would satisfy the standards for independence of a Board member
under listing standards of the New York Stock Exchange or other
applicable securities exchange.
(ii) the written and manually signed consent of the candidate to be
named as a nominee and to serve as a Trustee if elected;
(iii) the recommending shareholder's name as it appears on the Trust's
books and the class or series and number of allhold Class R1 shares of the Trust
owned beneficiallyFund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of recordthe annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses | |||||||||
Class R1 | ||||||||||||
Actual Expenses | 0.33 | % | 0.75 | % | 0.58 | % | 1.66 | % | ||||
Pro Forma Expenses | 0.33 | % | 1.00 | % | 0.23 | % | 1.56 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.33% annually of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Total Annual Fund Operating Expenses” would be lower. The column “Class R1 Actual Expenses” includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
I-47
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is May 1, 2007, the date of the Fund’s current prospectus.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 169 | $ | 523 | $ | 902 | $ | 1,965 | ||||
Class R1 (Pro Forma) | $ | 159 | $ | 493 | $ | 850 | $ | 1,856 | ||||
I-48
MFS Mid Cap Growth Fund (as of fiscal year ended August 31, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses(4) | |||||||||
Class R1 | ||||||||||||
Actual Expenses | 0.75 | % | 0.75 | % | 0.62 | % | 2.12 | % | ||||
Pro Forma Expenses | 0.75 | % | 1.00 | % | 0.27 | % | 2.02 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.75% annually of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and/or service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Total Annual Fund Operating Expenses” would be lower. “Other Expenses” include the estimated payment of a portion of the transfer-agent-related expenses of the MFS funds that invest in the Fund. The column “Class R1 Actual Expenses” includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, then MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
I-49
| (4) | MFS has agreed in writing to reduce its management fee to 0.70% annually in excess of $3 billion of the Fund’s average daily net assets, until modified by the Fund’s Board of Trustees. |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is January 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 215 | $ | 664 | $ | 1,139 | $ | 2,452 | ||||
Class R1 (Pro Forma) | $ | 205 | $ | 634 | $ | 1,088 | $ | 2,348 | ||||
I-50
MFS Mid Cap Value Fund (as of fiscal year ended September 30, 2007)
The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load)(as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that are Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3) | Total Annual Fund Operating Expenses(4) | |||||||||
Class R1 | ||||||||||||
Actual Expenses | 0.75 | % | 0.75 | % | 0.54 | % | 2.04 | % | ||||
Pro Forma Expenses | 0.75 | % | 1.00 | % | 0.19 | % | 1.94 | % |
| (1) | The management fee set forth in the Fund’s Investment Advisory Agreement with MFS is 0.75% annually of the Fund’s average daily net assets. |
| (2) | The Fund’s Distribution Plan permits it to pay distribution and service fees to support the sale and distribution of the Fund’s Class R1 shares and the services provided by financial intermediaries. The maximum rate that may be charged under the existing Distribution Plan as shown under the column “Class R1 Actual Expenses” is 0.75%, and the maximum rate that may be charged under the proposed Distribution Plan as shown under the column “Class R1 Pro Forma Expenses” is 1.00%. |
| (3) | The Fund has entered into an expense offset arrangement that reduces the Fund’s custodian fee based upon the amount of cash maintained by the Fund with its custodian. Such fee reduction is not reflected in the table. Had this fee reduction been taken into account, “Total Annual Fund Operating Expenses” would be lower. The column “Class R1 Actual Expenses” includes in “Other Expenses” an annual retirement plan administration and services fee paid by the Fund under the Master Class R Administration and Services Agreement from assets attributable to Class R1 shares to MFS for the provision by MFS, either directly or through other affiliated and/or unaffiliated entities, of various administrative, recordkeeping and communication/educational services in an amount equal to 0.35%. If the proposal to amend the Fund’s Distribution Plan is approved, MFS will terminate the Master Class R Administration and Services Agreement and eliminate the annual retirement plan administration and services fee. The “Class R1 Pro Forma Expenses” do not include the annual retirement plan administration and services fee of 0.35% in “Other Expenses.” |
I-51
| (4) | MFS has agreed in writing to reduce its management fee to 0.70% annually of the Fund’s average daily net assets in excess of $1 billion. MFS has agreed in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.60% annually for Class R1 shares. If the proposal to amend the Fund’s Distribution Plan is approved, this agreement will be amended to provide that MFS will agree in writing to bear the Fund’s expenses such that the “Other Expenses,” determined without giving effect to the expense offset arrangement described above, do not exceed 0.25% annually for Class R1 shares. This written agreement excludes management fees, distribution and service fees, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, and will continue until at least January 31, 2009. The “Class R1 Actual Expenses” reflect the current arrangement, and the “Class R1 Pro Forma Expenses” reflect the proposed amended arrangement, in each case, in “Other Expenses.” |
Example
The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is February 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
| 1 Year | 3 Years | 5 Years | 10 Years | |||||||||
Class R1 | $ | 207 | $ | 640 | $ | 1,098 | $ | 2,369 | ||||
Class R1 (Pro Forma) | $ | 197 | $ | 609 | $ | 1,047 | $ | 2,264 | ||||
I-52
MFS Moderate Allocation Fund (as of fiscal year ended May 31, 2007)
The Fund is a Fund-of-Funds. The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. In addition to the fees and expenses which you bear directly, you will indirectly bear the Fund’s pro rata share of the fees and expenses of the underlying funds in which the Fund invests. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements, and a weighted average of the total annual operating expenses (as reported in each underlying fund’s most recent shareholder report) of, and the fee (if any) charged by the recommending shareholder
(as evidencedunderlying funds in which the Fund invested during the Fund’s most recently completed fiscal year. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the Committee's satisfaction by a recent brokerage
or account statement);increase in the Class R1 Distribution and (iv) a description of all arrangements or understandings betweenService (12b-1) Fee, as contemplated under the recommending shareholderproposed amendment to the Distribution Plan and the candidateelimination of the Class R1 annual retirement plan administration and any other person or
persons (including their names) pursuant to which the recommendation
is being made by the recommending shareholder.
In addition, the Committeeservices fee. The Fund’s annual operating expenses may require the candidate to furnish such other
information as it may reasonably require or deem necessary to determine the
eligibility of such candidate to serve on the Board and information regarding
the candidatevary in future years.
| Class R1 | ||||
Actual Fees | Pro Forma Fees | |||
Shareholder Fees (Fees Paid Directly From Your Investment) | ||||
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) | None | None | ||
Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) | None | None | ||
Annual Fund Operating Expenses
(Expenses that would be requiredare Deducted from Fund Assets)
| Management Fee(1) | Distribution and Service (12b-1) Fee(2) | Other Expenses(3)(4) | Acquired (Underlying) Fund Fees and Expenses(3) | Total Annual Fund Operating Expenses(4) | ||||||||||
Class R1 | ||||||||||||||
Actual Expenses | N/A | 0.75 | % | 0.40 | % | 0.70 | % | 1.85 | % | |||||
Pro Forma Expenses | N/A | 1.00 | % | 0.05 | % | 0.70 | % | 1.75 | % |
| (1) | The Fund pays no management fee to MFS; however the underlying funds pay management fees to
I-53
Example The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is October 1, 2007, the date of the Fund’s current prospectus.
I-54 MFS New Discovery Fund (as of fiscal year ended August 31, 2007) The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
Annual Fund Operating Expenses (Expenses that are Deducted from Fund Assets)
I-55
Example The expenses below assume that you invest $10,000 in Class R1 shares of the
I-56 MFS New Endeavor Fund (as of fiscal year ended July 31, 2007) The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
Annual Fund Operating Expenses (Expenses that are Deducted from Fund Assets)
I-57
Example The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for
I-58 MFS Research Fund (as of fiscal year ended September 30, 2007) The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
Annual Fund Operating Expenses (Expenses that are Deducted from Fund Assets)
I-59 Example The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is February 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
I-60 MFS Research Bond Fund (as of fiscal year ended April 30, 2007) The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
Annual Fund Operating Expenses (Expenses that are Deducted from Fund Assets)
I-61 Example The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is September 1, 2007, the date of the Fund’s current prospectus.
I-62 MFS Research International Fund (as of fiscal year ended August 31, 2007) The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
Annual Fund Operating Expenses (Expenses that are Deducted from Fund Assets)
I-63
Example The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is January 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
I-64 MFS Strategic Value Fund (as of fiscal year ended of July 31, 2007) The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
Annual Fund Operating Expenses (Expenses that are Deducted from Fund Assets)
I-65 Example The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is December 1, 2007, the date of the Fund’s current prospectus.
I-66 MFS Technology Fund (as of fiscal year ended August 31, 2007) The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
Annual Fund Operating Expenses (Expenses that are Deducted from Fund Assets)
I-67
Example The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is January 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
I-68 MFS Total Return Fund (as of fiscal year ended September 30, 2007) The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
Annual Fund Operating Expenses (Expenses that are Deducted from Fund Assets)
I-69 Example The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is February 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
I-70 MFS Utilities Fund (as of fiscal year ended October 31, 2007) The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
Annual Fund Operating Expenses (Expenses that are Deducted from Fund Assets)
I-71 Example The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same. The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is March 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
I-72 MFS Value Fund (as of fiscal year ended August 31, 2007) The following tables describe the fees and expenses that you may pay when you buy, redeem, and hold Class R1 shares of the Fund. The “Class R1 Actual Expenses” are based on expenses incurred during the Fund’s most recently completed fiscal year adjusted to reflect annualized expenses and current fee arrangements. The “Class R1 Pro Forma Expenses” are adjusted to give effect to the increase in the Class R1 Distribution and Service (12b-1) Fee, as contemplated under the proposed amendment to the Distribution Plan and the elimination of the annual retirement plan administration and services fee. The Fund’s annual operating expenses may vary in future years.
Annual Fund Operating Expenses (Expenses that are Deducted from Fund Assets)
I-73 Example The expenses below assume that you invest $10,000 in Class R1 shares of the Fund for the time periods indicated, you redeem your shares at the end of the time periods, and your investment has a 5% return each year and dividends and other distributions are reinvested and the Fund’s operating expenses remain the same, except that the Fund’s total operating expenses are assumed to be the Fund’s “Net Expenses” for the period during which any written fee reductions are in effect (see the Expense Table above). The Class R1 pro forma expense examples also assume, during the entirety of the time period indicated, that the proposed distribution and service (12b-1) fee under the amended Distribution Plan is in effect and that the annual retirement plan administration and services fee has been eliminated. The commencement date for the example is January 1, 2008, the date of the Fund’s prospectus following the Fund’s most recent fiscal year end.
I-74 Schedule II: Fees Paid under Current Distribution Plan for Most Recently Reported Fiscal Year The table below shows the amount of 12b-1 Fees actually paid by Class R1 Shares of each Fund under the current Distribution Plan during each Fund’s most recently reported fiscal year, both in the aggregate and as a percentage of the Fund’s average daily net asset value. All payments were made to MFS Fund Distributors, Inc., the principal underwriter of shares of each
II-1 Schedule III: Number of Outstanding Shares as of December 10, 2007 The following table shows the total number of Class R1 Shares of each Fund that were issued and outstanding as of December 10, 2007, the record date. Shareholders of record at the close of business on December 10, 2007 will be entitled to one vote for each dollar of net asset value held on that date. Each fractional dollar amount is entitled to a proportionate fractional share.
III-1 Schedule IV: Interests of Certain Persons As of December 3, 2007, to the best knowledge of the Funds, the following shareholders owned of record or beneficially 5% or more of the outstanding Class R1 shares of the Funds:
IV-1
IV-2
IV-3
IV-4
IV-5
IV-6
IV-7
IV-8
IV-9
IV-10
PROXY FOR TO BE HELD ON The undersigned hereby appoints 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 VOTEDFOR
YOUR TRUSTEES RECOMMEND THAT YOU VOTEFOR
PLEASE SIGN
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