MFS Government Markets Income Trust – ‘SC 14D9’ on 9/25/07 re: MFS Government Markets Income Trust

On:  Tuesday, 9/25/07, at 4:12pm ET   ·   Accession #:  912938-7-443   ·   File #:  5-47869

in

this entire Filing. an “Entity” Search.

Show

Documents searched

and

each “hit”. the 1st “hit”.

↓↑Hints

Tender-Offer Solicitation/Recommendation Statement   —   Schedule 14D-9
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: SC 14D9     Tender-Offer Solicitation/Recommendation Statement    70    233K 

Document Table of Contents

SC 14D9
1st Page of 70
TOC
↑Top
Previous
Next
↓Bottom
Just 1st
 
================================================================================

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 ---------------

SCHEDULE 14D-9
 Solicitation/Recommendation Statement
 under
 Section 14(d)(4) of the Securities Exchange Act of 1934
 ---------------

 MFS GOVERNMENT MARKETS INCOME TRUST
 (Name of Subject Company)
 ---------------

 MFS GOVERNMENT MARKETS INCOME TRUST
 (Name of Person Filing Statement)

 COMMON SHARES OF BENEFICIAL INTEREST, WITHOUT PAR VALUE
(Title of Class of Securities)

 552939100
 (CUSIP Number of Class of Securities)

 ---------------

 Susan S. Newton
Massachusetts Financial Services Company
 500 Boylston Street
 Boston, Massachusetts 02116
(617) 954-5000
 (Name, Address and Telephone Number of Person Authorized to Receive
 Notice and Communications On Behalf of the Person Filing Statement)

 WITH A COPY TO:

Gregory D. Sheehan, Esq.
Ropes & Gray LLP
 One International Place
 Boston, Massachusetts 02110
(617) 951-7000
 ---------------

    Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.                     

=============================================================================== 

SC 14D9
2nd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 2nd
Item 1. Subject Company Information.                                            

         The name of the subject company is MFS Government Markets Income Trust,
a Massachusetts business trust (the "Fund"). The address of its principal       
executive offices is 500 Boylston Street, Boston, Massachusetts 02116. The      
telephone number at its principal executive offices is (617) 954-5000.          

The title of the class of equity securities to which this     
Solicitation/Recommendation Statement on Schedule 14D-9 (together with the      
Exhibits hereto, this "Statement") relates is the common shares of beneficial   
interest without par value of the Fund (the "Common Shares"). As of September 4,
2007, there were 51,332,556 shares of Common Shares outstanding.                

Item 2. Identity and Background of Filing Person.                               

     The filing person is the subject company. The Fund's name, business
address and business telephone number are set forth in Item 1 above.            

  This Statement relates to the offer by Bulldog Investors General
Partnership ("BIGP"), which, according to the Schedule TO filed by it on        
September 12, 2007 (the "BIGP Schedule TO"), is a New York general partnership, 
to purchase up to 5,000,000 of the issued and outstanding Common Shares at a    
price per share equal to 96.25% of the net asset value per share determined as  
of the close of the regular trading session of the New York Stock Exchange on   
the Expiration Date, as defined in the BIGP Schedule TO, net to the seller in   
cash (subject to a $50 processing fee that BIGP will charge for processing each 
Letter of Transmittal, applicable withholding taxes and any brokerage fees that 
may apply), without interest upon the terms and subject to the conditions set   
forth in the Offer to Purchase, dated September 11, 2007 (the "BIGP Offer to    
Purchase"), and in the related Letter of Transmittal (which, together with the  
BIGP Offer to Purchase, constitute the "BIGP Offer"). The BIGP Schedule TO and  
BIGP Offer to Purchase refer to "shares of common stock". For purposes of this  
Statement only, the Fund assumes that the BIGP Offer relates to the Fund's      
Common Shares. The Fund notes that it has no outstanding securities with the    
title "common stock."                                                           

         According to the BIGP Schedule TO, the business address of BIGP is Park
80 West, Plaza Two, Suite 750, Saddle Brook, New Jersey 07663, and the business 
telephone number of BIGP is (646) 378-2105.                                     

Item 3. Past Contracts, Transactions, Negotiations and Agreements.              

   Except as described in this Statement or in the excerpts from the
Fund's proxy statement dated September 14, 2007 (the "2007 Proxy Statement")    
filed as Exhibit (e)(1) to this Statement, there are no material agreements,    
arrangements, understandings, or any actual or potential conflicts of interest  
between the Fund or its affiliates and (1) the Fund, its executive officers,    
trustees or affiliates or (2) BIGP or its executive officers, directors or      
affiliates. The excerpts from the 2007 Proxy Statement filed as Exhibit (e)(1)  
to this Statement are incorporated herein by this reference and include the     
information beginning on the following pages and with the following headings:   

o    Page 12: Share Ownership.                                        

1 

SC 14D9
3rd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 3rd
o    Page 13: Trustee Compensation Table.                             

o    Page 19: Trust Information. Investment Adviser and Administrator.

Description of Relevant Agreements.                                             

o    Investment  Advisory  Agreement:  Dated  January  1, 2002,  the  Investment
     Advisory Agreement  generally provides that MFS shall act as the investment
     adviser  to the Fund  and,  as such,  shall  (i)  furnish  continuously  an
     investment  program for the Fund, (ii) determine what investments  shall be
     purchased,  held,  sold or exchanged by the Fund, and (iii)  determine what
     portion,  if any,  of the  assets  of the Fund  shall  be held  uninvested,
     subject to the control of the  Trustees of the Fund.  MFS is paid a fee for
     its services monthly.  The Investment  Advisory  Agreement provides that it
     must  be  approved  at  least  annually  by the  affirmative  vote of (1) a
     majority of the Trustees who are not interested  persons of the Fund or MFS
     at a  meeting  specifically  called  for  the  purpose  of  voting  on such
     approval,  and (2) by the Board of  Trustees  of the Fund,  or by vote of a
     majority  of the  outstanding  voting  securities  of the Fund,  and is not
     earlier  terminated  by the Fund or MFS.  This summary  description  of the
     Investment  Advisory  Agreement  does not  purport  to be  complete  and is
     qualified  in  its  entirety  by  reference  to  the  Investment   Advisory
     Agreement,  which is filed as Exhibit (e)(2) hereto and incorporated herein
by reference.                                                         

o    Closed End Fund Oversight Agreement:  Dated January 1, 2007, the Closed-End
     Fund Oversight  Agreement  generally provides that MFS Service Center, Inc.
     ("MFSC") shall provide oversight services with respect to the activities of
     Computershare Trust Company, N.A. ("Computershare"), the transfer agent for
     the Fund, and Computershare  Shareholder Services,  Inc. ("CSS"), the agent
     for  the  Fund's  dividend  reinvestment  plan.  MFSC is paid a fee for its
     services monthly, and also receives payment from the Fund for out-of-pocket
     expenses paid by MFSC on behalf of the Fund.  This summary  description  of
     the Closed-End Fund Oversight Agreement does not purport to be complete and
     is qualified in its entirety by reference to the Closed-End  Fund Oversight
     Agreement,  which is filed as Exhibit (e)(3) hereto and incorporated herein
by reference.                                                         

o    Administrative Services Agreement: Dated August 1, 2006, as amended August 
  1, 2007, the amended and restated administrative services agreement (the
"Administrative Services Agreement") generally provides that MFS shall
    provide certain accounting, legal, shareholder communications, compliance,
  and other administrative services to the Fund. The Fund pays MFS a fixed
amount plus a fee based on average daily net assets of the Fund. This 
summary description of the Administrative Services Agreement does not 
     purport to be complete and is qualified in its entirety by reference to the
    Administrative Services Agreement, which is filed as Exhibit (e)(4) hereto
and incorporated herein by reference.                                 

o    Fidelity  Bond Claim  Agreement:  The Fund and certain other MFS funds have
     entered into a fidelity  bond claim  agreement  (the  "Fidelity  Bond Claim
     Agreement")  with the MFS Parties (as  defined in the  Fidelity  Bond Claim
     Agreement).  Each of the parties to the agreement are named  insureds under
     broker's  blanket bonds described in the Fidelity Bond Claim Agreement (the
     "Bonds").  The Fidelity Bond Claim  Agreement  establishes  the criteria by
 which the premium for  payment of the bonds  shall be  allocated  among

2 

SC 14D9
4th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 4th
     the parties and the  criteria by which  losses in excess of the face amount
     of the Bonds shall be allocated among the parties. This summary description
     of the Fidelity Bond Claim Agreement does not purport to be complete and is
     qualified  in  its  entirety  by  reference  to  the  Fidelity  Bond  Claim
     Agreement,  which is filed as Exhibit (e)(5) hereto and incorporated herein
by reference.                                                         

o    Indemnification   Agreement:  The  Fund  is  party  to  an  indemnification
     agreement  dated January 24, 2006 (the  "Indemnification  Agreement")  with
     each of the  Trustees  who  are not  "interested  persons"  of the  Fund as
     defined in the  Investment  Company Act of 1940  ("Independent  Trustees").
     Under the  Indemnification  Agreement,  the Fund shall  indemnify  and hold
     harmless  each Trustee  against any and all Expenses  actually  incurred or
     paid by the Trustee in any  Proceeding  in  connection  with the  Trustee's
     service to the Fund  ("Expenses" and  "Proceeding"  are each defined in the
     Indemnification Agreement). This summary description of the Indemnification
     Agreement  does not purport to be complete and is qualified in its entirety
     by reference to the  Indemnification  Agreement,  which is filed as Exhibit
(e)(6) hereto and incorporated herein by reference.                   

Item 4. The Solicitation or Recommendation.                                     

(a) Solicitation/ Recommendation.                                   

         The Board of Trustees ("Board") of the Fund met to consider and discuss
the BIGP Offer on September 19, 2007. At that meeting, the Board appointed a    
special committee (the "Special Committee") of the Board, which is comprised    
solely of Independent Trustees, to evaluate and assess the terms of the BIGP    
Offer in consultation with "independent legal counsel" (as defined in Rule      
0-1(a)(6) under the Investment Company Act of 1940), the Fund's Independent     
Chief Compliance Officer, a full-time senior officer appointed by and reporting 
to the independent Trustees, and such other experts as the Special Committee    
chooses to engage.                                                              

     The Special Committee met to consider and discuss the BIGP Offer on
September 24, 2007. At that meeting, the Board's independent legal counsel made 
presentations regarding legal matters pertaining to the BIGP Offer and the      
Fund's potential responses, including an overview of public filing and other    
obligations under applicable securities laws. After careful consideration at the
September 24th meeting, the Special Committee concluded that (1) the closed-end 
structure offers the Fund the best platform to achieve its objective, (2) the   
actions taken by the Board to address the Fund's discount to NAV represent a    
more favorable long-term solution to narrowing or eliminating the Fund's        
discount to NAV than the BIGP Offer, (3) the conditions in the BIGP Offer raise 
substantial doubt regarding BIGP's obligation to consummate the BIGP Offer, (4) 
the BIGP Offer is, by its nature, coercive, and contains economically           
disadvantageous terms, and (5) the BIGP Offer contains inadequate information to
assess whether BIGP has the financial resources to consummate the BIGP Offer.   
Accordingly, the Special Committee determined that the BIGP Offer was not in the
best interests of shareholders and, therefore, recommended to the Board that the
Board recommend that the Fund's shareholders reject the BIGP Offer and not      
tender their shares to BIGP.                                                    

       At a meeting held on September 25, 2007, the Board met to receive the
recommendation of the Special Committee and to consider and discuss the BIGP    
Offer and the factors considered by the Special Committee in making its         
recommendation. At that meeting, the Board, by unanimous vote, determined to    
recommend that the Fund's shareholders reject the BIGP Offer and not tender     
their shares to BIGP.                                                           

3 

SC 14D9
5th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 5th
       The following discussion of the information and factors considered by
the Board and the Special Committee is not meant to be exhaustive, but includes 
material information, factors and analyses considered by the Board and the      
Special Committee in reaching their respective conclusions and recommendations. 
The members of the Board and the Special Committee evaluated the various factors
listed below in light of their knowledge of the business, financial condition,  
and prospects of the Fund and based upon the advice of independent legal        
counsel. In light of the number and variety of factors that the Board and the   
Special Committee considered, the members of the Board and the Special Committee
did not find it practicable to assign relative weights to the foregoing factors.
The recommendations of the Board and Special Committee were made after          
considering the totality of the information and factors involved. In addition,  
individual members of the Board or the Special Committee may have given         
different weight to different factors.                                          

(b) Reasons                                                           

    In reaching the conclusions and in making the recommendation
described above, the Board and the Special Committee consulted with its legal   
advisors and the Fund's Independent Chief Compliance Officer, and considered a  
number of factors, including, but not limited to those set forth below:         

         The Fund operates best as a closed-end fund. BIGP has announced that it
is making the BIGP Offer to gain influence over management of the Fund and that 
it seeks a fundamental change in the structure of the Fund - causing the Fund to
convert from a closed-end structure to an open-end structure. The Board and the 
Special Committee believe that BIGP intends to use its higher percentage        
ownership of the Fund following consummation of the BIGP Offer to effect this   
change, to the detriment of shareholders of the Fund who invested in the Fund on
the basis that it was structured as a closed-end fund, and who wish to remain   
invested in a closed-end fund.                                                  

While conversion to an open-end structure would eliminate any 
then-existing discount to NAV, it would also have adverse consequences that the 
closed-end structure of the Fund was designed to prevent. For example,          
conversion to an open-end structure would mean that the Fund's portfolio        
managers will no longer be able to cause the Fund's assets to be fully invested 
in income-generating securities, thereby reducing the Fund's yield. In addition,
as a result of restrictions that the Investment Company Act places on leveraging
by open-end funds, conversion to an open-end structure would significantly      
jeopardize the portfolio manager's efforts to seek increased investment return  
through leverage.                                                               

   Experience also has shown that professional fund arbitrageurs and
certain hedge funds which are current shareholders of the Fund would likely     
redeem their shares in the Fund immediately upon its conversion to an open-end  
structure, thereby reducing the Fund's assets - potentially substantially - and 
causing the Fund's expense ratio to rise significantly. These arbitrageurs are  
interested solely in short-term gain at the expense of shareholders who wish to 
hold the Fund's shares as a long-term investment.                               

4 

SC 14D9
6th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 6th
        The Board has taken actions to address the Fund's discount to NAV. The
Board regularly considers actions that may be taken to minimize the Fund's      
discount to NAV and from time to time has authorized the Fund to repurchase its 
shares in the open market as a means of narrowing the Fund's discount. In 2006, 
the Board was advised by an independent third party regarding methods by which  
closed-end funds attempt to manage their discounts. In April 2007, the Board    
approved a change to the Fund's investment strategy to permit the Fund to invest
in higher yielding securities and recommended approval by shareholders of a     
proposal to allow the use of leverage in the management of the Fund.            
Shareholders have not yet had the opportunity to consider this proposal as it is
proposed for approval at the Fund's annual shareholder meeting schedule for     
November 1, 2007. The Board believes that both of these measures may increase   
the Fund's yield and also result in a narrowing or elimination of the Fund's    
discount to NAV.                                                                

         In addition, in July 2007, the Board authorized the adoption of a level
distribution plan pursuant to which the Fund now makes monthly distributions at 
a minimum annual rate of 7.25%. The Fund's first distribution under this plan   
was declared on September 4, 2007, and will be paid to shareholders of record on
September 28, 2007. The Board believes that this plan, upon implementation, may 
have the effect of narrowing or eliminating the Fund's discount to NAV.         

         The BIGP Offer is excessively conditional. The BIGP Offer is subject to
numerous conditions. One important condition ties BIGP's obligation to          
consummate the offer to the election of four trustee candidates that BIGP has   
stated that it proposes to nominate at the Fund's shareholder meeting on        
November 1, 2007 to replace four current members of the Board. Specifically,    
BIBP is not required to consummate the offer if shareholders do not elect its   
trustee candidates. However, even if BIGP's candidates are elected, the broadly 
worded nature of the other conditions in the BIGP Offer make it uncertain that  
the offer will be consummated. For example, if there occurs "any change,        
circumstance, event or effect" that "could reasonably be expected to have, in   
the sole discretion of BIGP, a material adverse effect on the Fund or the value 
of the Shares or, assuming consummation of the BIGP Offer, on BIGP or any of its
affiliates," BIGP could elect not to consummate the offer The BIGP Offer to     
Purchase also states that BIGP has the right to declare a condition not         
satisfied even if the failure to be satisfied was caused by an action or        
inaction of BIGP. In addition, by tying the tender offer to the election of its 
trustee candidates, BIGP is inducing shareholders to elect trustee candidates   
about whom the Fund currently does not have enough information to determine that
they are not "interested persons" of the Fund (as defined in the Investment     
Company Act of 1940), creating uncertainty about compliance with the requirement
under regulatory settlements that 75% of the Fund's trustees be comprised of    
non-interested persons. Because of the broad nature of BIGP's other conditions, 
as well as the fact that the tender offer closes after the November 1st         
shareholder meeting, it is possible that BIGP will induce shareholders to vote  
for its trustee candidates yet not consummate the tender offer.                 

   The BIGP Offer is coercive. The BIGP Offer represents a threat to
shareholders because the BIGP Offer is designed to coerce shareholders to       
participate in the offer on disadvantageous terms. BIGP states that the BIGP    
Offer is being made to allow BIGP to gain influence over management of the Fund 
and increase BIGP's voting power to cause the Fund to become an open-ended fund.
The BIGP Offer is coercive because it creates an economic incentive for         

5 

SC 14D9
7th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 7th
shareholders to tender so that they can avoid (i) being left as minority        
shareholders of a fund with a shareholder - BIGP - that is seeking to increase  
its influence and force its agenda upon management and the other shareholders   
and (ii) facing a radical change in the structure of the Fund. As a result, even
shareholders who wish to remain invested in the Fund may feel compelled to      
participate in the BIGP Offer in order to minimize their investment in the Fund 
during a period when radical changes are being made to its structure. Further,  
if the BIGP Offer is over-subscribed, shareholders who had hoped to redeem      
completely from the Fund will have to remain at least partially invested in the 
Fund during this period of change.                                              

         The BIGP Offer has economically disadvantageous terms. BIGP will assess
a $50 processing fee to each shareholder who tenders. This amount is            
considerably higher than the amount that the depositary charges to actually     
process the letter of transmittal submitted by a shareholder who chooses to     
tender his or her shares. For shareholders who hold shares in multiple names    
(e.g., John Jones, John and Mary Jones, and John Jones as trustee for Mary      
Jones), a separate letter of transmittal will be required for each account and  
the $50 fee will be charged each time. The $50 processing fee, when deducted    
from the proceeds of small account holders (or holders whose tendered shares are
reduced if the BIGP Offer is oversubscribed), could significantly reduce the    
return realized by these shareholders.                                          

       Shareholders have inadequate information to evaluate BIGP's financial
resources. While BIGP states that the BIGP Offer is not subject to a financing  
condition, BIGP has not provided adequate information to evaluate its ability to
complete the BIGP Offer, other than to state that it will pay the aggregate     
costs of the BIGP Offer (and any other tender offers it may launch against other
companies or funds) using its investment capital. No BIGP financial statements  
are included as part of the Schedule TO.                                        

    In light of the factors described above, each of the Board and the
Special Committee has determined that the BIGP Offer is not in the best         
interests of the Fund's shareholders. Therefore, the Board recommends that      
shareholders of the Fund reject the BIGP Offer and not tender their shares into 
the BIGP Offer.                                                                 

(c) Intent to Tender                                                  

    To the best knowledge of the Fund, none of its trustees, executive
officers, affiliates, or subsidiaries currently intends to tender Common Shares 
held of record or beneficially by such person for purchase pursuant to the BIGP 
Offer.                                                                          

Item 5. Person/Assets Retained, Employed, Compensated or Used.                  

Members of the Board of the Fund and employees of MFS may make
recommendations to the shareholders of the Fund with respect to the BIGP Offer. 

Item 6. Interest in Securities of the Subject Company.                          

     During the past 60 days, no transactions with respect to the Common
Shares have been effected by the Fund or, to the Fund's knowledge, by any of its
executive officers, trustees, affiliates or subsidiaries.                       

6 

SC 14D9
8th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 8th
Item 7. Purposes of the Transaction and Plans or Proposals.                     

         The Board continually considers all strategic alternatives available to
the Fund and, in light of the BIGP Offer, discussions between representatives of
the Fund and BIGP have taken place.                                             

        The Fund reserves the right to develop and evaluate other alternatives
to the BIGP Offer.                                                              

Item 8. Additional Information.                                                 

        This Statement is not an offer to sell, nor a solicitation of an offer
to buy, shares of any fund, nor is it a solicitation of any proxy in connection 
with the Fund's shareholder meeting. On September __, 2007, the Fund issued a   
press release (the "Press Release") relating to the proposed BIGP Offer, which  
contains important information. The materials have also been filed with the     
Securities and Exchange Commission (the "SEC"). For more information regarding  
the funds, or to receive a free copy of the materials filed with the SEC,       
including the Press Release, please visit www.mfs.com. Free copies of such      
materials can also be found on the SEC's website (http://www.sec.gov). Please   
note that the information contained at www.mfs.com does not constitute part of  
this Statement.                                                                 

7 

SC 14D9
9th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 9th
Item 9. Material to be Filed as Exhibits.                                       

Exhibit No.                           Description                             
(a)(1)          Press Release issued by the Fund on September 25, 2007.         
Filed herewith.                                 
(e)(1)          Excerpts from the Proxy Statement of the Fund, dated September  
14, 2007, filed with the Securities             
              and Exchange Commission on Schedule 14A on September 14, 2007.
Filed herewith.                                 
(e)(2)          Investment Advisory Agreement, dated January 1, 2002, between   
             the Fund and Massachusetts Financial Services Company.  Filed
herewith.                                       
(e)(3)          Closed-End Fund Oversight Agreement, dated January 1, 2007,     
           between MFSC and each of the closed-end funds identified on
Exhibit A thereto. Filed herewith.              
(e)(4)          Amended and Restated Master Administrative Services Agreement,  
            dated August 1, 2006 between the Fund and MFS (with Exhibits
revised as of August 1, 2007).  Filed herewith. 
(e)(5)          Fidelity Bond Claim Agreement, dated as of November 1, 1993, as 
            amended and restated June 12, 2002 between certain MFS Funds
          named on Exhibit A thereto and the MFS Parties (as defined
therein). Filed herewith.                       
(e)(6)          Form of Indemnification Agreement, dated as of January 24, 2006,
            between certain MFS Funds named on Exhibit A thereto and the
Trustees of each Fund. Filed herewith.          

--------------------------------------------------------------------------------

8 

SC 14D9
10th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 10th
 SIGNATURE

         After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct. 

                                   MFS GOVERNMENT MARKETS INCOME TRUST

                      By:/s/ Susan S. Newton
                                      --------------------------------------
                        Name:    Susan S. Newton
                            Title:   Assistant Secretary

Dated:  September 25, 2007                                                      

9 

SC 14D9
11th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 11th
                                                                  Exhibit (a)(1)

FOR IMMEDIATE RELEASE                                                           

CONTACT:  John Reilly                                                           
(617) 954-5305                                              

BOARD OF TRUSTEES OF MFS GOVERNMENT MARKETS INCOME TRUST
 RECOMMENDS THAT SHAREHOLDERS REJECT BIGP'S TENDER OFFER

BOSTON, Massachusetts (September 25, 2007) - The Board of Trustees of MFS       
Government Markets Income Trust (the "Fund") recommends that the Fund's         
shareholders reject the offer by Bulldog Investors General Partnership ("BIGP") 
announced on September 11, 2007 to purchase shares of the Fund. The Board       
appointed a special committee comprised solely of independent trustees to       
evaluate and assess the terms of the tender offer.                              

The Board, upon the recommendation of the special committee, has carefully      
considered BIGP's tender offer (the "BIGP Offer") and found that it is not in   
the best interest of shareholders for the following reasons.                    

     o    The Fund operates best as a closed-end  fund.  BIGP has announced that
          it is making the BIGP Offer to gain influence  over  management of the
          Fund and that it wants to cause the Fund to convert  from a closed-end
          structure  to  an  open-end  structure.  The  Board  believes  that  a
          conversion to an open-end  structure will hurt those  shareholders who
          invested  in the  Fund  on the  basis  that  it  was  structured  as a
          closed-end fund, and who wish to remain invested in a closed-end fund.

          While  conversion  to  an  open-end   structure  would  eliminate  any
          then-existing discount to NAV, it would also have adverse consequences
          that the closed-end structure of the Fund was designed to prevent. For
          example,  conversion to an open-end structure would prevent the Fund's
          assets from being  fully  invested  in  income-generating  securities,
          thereby  reducing  the  Fund's  yield.  In  addition,  as a result  of
          restrictions  that the Investment  Company Act places on leveraging by
          open-end   funds,   conversion   to  an   open-end   structure   would
          significantly  jeopardize  the  portfolio  manager's  efforts  to seek
increased investment return through leverage.               

          Experience  also has shown that  professional  fund  arbitrageurs  and
          certain hedge funds which are current  shareholders  of the Fund would
          likely redeem their shares in the Fund immediately upon its conversion
          to an  open-end  structure,  thereby  reducing  the  Fund's  assets  -
          potentially  substantially  - and causing the Fund's  expense ratio to
          rise  significantly.  These  arbitrageurs  are  interested  solely  in
          short-term  gain at the expense of  shareholders  who wish to hold the
Fund's shares as a long-term investment.                    

1 

SC 14D9
12th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 12th
     o    The Board has taken actions to address the Fund's discount to NAV. The
          Board  regularly  considers  actions that may be taken to minimize the
          Fund's  discount to NAV and has from time to time  authorized the Fund
          to  repurchase  its shares in the open market as a means of  narrowing
          the Fund's discount.  In 2006, the Board was advised by an independent
          third party  regarding  methods by which  closed-end  funds attempt to
          manage their discounts.  In April 2007, the Board approved a change to
          the Fund's investment  strategy to permit the Fund to invest in higher
          yielding  securities and  recommended  approval by  shareholders  of a
          proposal to allow the use of leverage in the  management  of the Fund.
          Shareholders  have  not yet  had  the  opportunity  to  consider  this
          proposal  as  it  is  proposed  for  approval  at  the  Fund's  annual
          shareholder  meeting schedule for November 1, 2007. The Board believes
          that both of these  measures  may  increase  the Fund's yield and also
       result in a narrowing or elimination of the Fund's discount to NAV.

          In  addition,  in July 2007,  the Board  authorized  the adoption of a
          level  distribution  plan pursuant to which the Fund now makes monthly
          distributions  at a minimum  annual  rate of 7.25%.  The Fund's  first
          distribution  under this plan was declared on  September 4, 2007,  and
          will be paid to  shareholders  of record on September  28,  2007.  The
          Board  believes  that this  plan,  upon  implementation,  may have the
  effect of narrowing or eliminating the Fund's discount to NAV.

     o    The BIGP Offer is excessively  conditional.  The BIGP Offer is subject
          to numerous conditions. One important condition ties BIGP's obligation
          to  consummate  the offer to the election of four  trustee  candidates
          that BIGP has  stated  that it  proposes  to  nominate  at the  Fund's
          shareholder  meeting  on  November  1, 2007 to  replace  four  current
          members of the Board. Specifically, BIGP is not required to consummate
          the  offer  if  shareholders  do not  elect  its  trustee  candidates.
          However,  even if BIGP's  candidates  are elected,  the broadly worded
          nature of the other  conditions  in the BIGP Offer  make it  uncertain
          that the offer will be consummated.  For example, if there occurs "any
          change,  circumstance,  event or effect"  that  "could  reasonably  be
          expected to have, in the sole  discretion of BIGP, a material  adverse
          effect  on  the  Fund  or  the  value  of  the  Shares  or,   assuming
          consummation  of the BIGP  Offer,  on BIGP or any of its  affiliates,"
          BIGP  could  elect  not to  consummate  the  offer  The BIGP  Offer to
          Purchase  also  states  that BIGP has the right to declare a condition
          not  satisfied  even if the failure to be  satisfied  was caused by an
          action or inaction of BIGP. In addition,  by tying the tender offer to
          the election of its trustee candidates,  BIGP is inducing shareholders
          to elect trustee  candidates  about whom the Fund  currently  does not
          have enough  information  to determine  that they are not  "interested
          persons"  of the Fund (as  defined in the  Investment  Company  Act of
          1940),  creating  uncertainty  about  compliance  with the requirement
          under  regulatory  settlements  that  75% of the  Fund's  trustees  be
          comprised of  non-interested  persons.  Because of the broad nature of
          BIGP's  other  conditions,  as well as the fact that the tender  offer
          closes after the November 1st shareholder meeting, it is possible that
          BIGP will induce  shareholders to vote for its trustee  candidates yet
not consummate the tender offer.                            

     o    The BIGP  Offer is  coercive.  The BIGP Offer  represents  a threat to
          shareholders because the BIGP Offer is designed to coerce shareholders
to participate in the offer on                              

2 

SC 14D9
13th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 13th
          disadvantageous  terms. BIGP states that the purpose of the BIGP Offer
          is for BIGP to gain influence over management of the Fund and increase
          BIGP's  voting power to cause the Fund to become an  open-ended  fund.
          The BIGP Offer is coercive because it is creates an economic incentive
          for  shareholders  to  tender  in  order to avoid  (i)  being  left as
          minority  shareholders  a fund  with a  shareholder  - BIGP - that  is
          seeking to increase its influence and force its agenda upon management
          and  other  shareholders  and (ii)  facing  a  radical  change  in the
          structure  of the Fund.  As a result,  even  shareholders  who wish to
          remain  invested in the Fund may feel  compelled to participate in the
          BIGP Offer in order to minimize their  investment in the Fund during a
          period when radical changes are being made to its structure.  Further,
          if the BIGP Offer is  over-subscribed,  shareholders  who had hoped to
          redeem completely from the Fund will have to remain at least partially
invested in the Fund during this period of change.          

     o    The BIGP  Offer  has  economically  disadvantageous  terms.  BIGP will
          assess a $50  processing  fee to each  shareholder  who tenders.  This
          amount  is as much as five  times  higher  than  the  amount  that the
          depositary  charges to  actually  process  the  letter of  transmittal
          submitted  by a  shareholder  who chooses to tender his or her shares.
          For shareholders who hold shares in multiple names (e.g.,  John Jones,
          John and Mary  Jones,  and John Jones as trustee  for Mary  Jones),  a
          separate  letter of transmittal  will be required for each account and
          the $50 fee will be charged each time.  The $50  processing  fee, when
          deducted from the proceeds of small account  holders (or holders whose
          tendered  shares are  reduced  if the BIGP  Offer is  oversubscribed),
         could significantly reduce the return realized by these shareholders.

     o    Shareholders have inadequate  information to evaluate BIGP's financial
          resources.  While BIGP  states that the BIGP Offer is not subject to a
          financing  condition,  BIGP has not provided  adequate  information to
          evaluate its ability to complete  the BIGP Offer,  other than to state
          that it will pay the aggregate  costs of the BIGP Offer (and any other
          tender offers it may launch  against  other  companies or funds) using
          its investment capital.  No BIGP financial  statements are included as
part of the Schedule TO.                                    

In light of the factors described above, the Board has determined that the      
tender offer is not in the best interests of the Fund's shareholders. Therefore,
the Board recommends that shareholders of the Fund reject the tender offer and  
not tender their shares to BIGP.                                                

In   connection    with   the   tender    offer,    the   Fund   has   filed   a
Solicitation/Recommendation  Statement on Schedule 14D-9 with the Securities and
Exchange  Commission  (the "SEC").  Investors and security  holders are strongly
advised to read the  Solicitation/Recommendation  Statement  because it contains
important   information   about   the   BGIP   Offer.   Free   copies   of   the
Solicitation/Recommendation  Statement are available at  www.mfs.com  and on the
SEC's website at www.sec.gov.                                                   

About MFS Investment Management:                                                
MFS manages $202 billion in assets on behalf of more than 5 million individual  
and institutional                                                               

3 

SC 14D9
14th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 14th
investors  worldwide as of June 30, 2007. The company traces its origins to 1924
and the creation of America's first mutual fund. For more information, please go
to www.mfs.com.                                                                 

 * * * * *

The foregoing is not an offer to sell, nor a solicitation of an offer to buy,   
shares of any fund, nor is it a solicitation of any proxy.                      

4 

SC 14D9
15th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 15th
                                                                  Exhibit (e)(1)

EXCERPTS FROM THE FUND'S PROXY STATEMENT, DATED SEPTEMBER 14, 2007              

[Page 12]                                                                       

Share Ownership                                                                 
As of September 4, 2007, the Trustees and officers of the Trust as a whole owned
less than 1% of the outstanding shares of the Trust.                            

The following table shows the dollar range of equity securities beneficially    
owned by each nominee or Trustee (a) of the Trust and (b) on an aggregate basis,
in all MFS funds overseen by the nominee or Trustee, as of September 4, 2007.   

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                                                        

                                                        [Enlarge/Download Table]

                                                                                                                            
                                                                                        Aggregate         Aggregate Dollar  
                                                                                          Dollar              Range of      
                                                                                         Range of          Securities in    
                                                                                          Equity           All MFS Funds    
                                                                                        Securities          Overseen or     
                                                                                            in           to be Overseen by  
Name of Trustee                                      Trust Name                         the Trust           the Nominee     
---------------------------------- ----------------------------------------------- --------------------- -------------------

INTERESTED TRUSTEES                                                                                                         
Robert J. Manning                  MFS Government Markets Income Trust                      N                    D          
Robert C. Pozen                    MFS Government Markets Income Trust                      N                    D          
INDEPENDENT TRUSTEES                                                                                                        
Robert E. Butler                   MFS Government Markets Income Trust                      N                    D          
Lawrence H. Cohn, M.D.             MFS Government Markets Income Trust                      B                    D          
David H. Gunning                   MFS Government Markets Income Trust                      N                    D          
William R. Gutow                   MFS Government Markets Income Trust                      N                    D          
Michael Hegarty                    MFS Government Markets Income Trust                      N                    D          
J. Atwood Ives                     MFS Government Markets Income Trust                      N                    D          
Lawrence T. Perera                 MFS Government Markets Income Trust                      A                    D          
J. Dale Sherratt                   MFS Government Markets Income Trust                      B                    D          
Laurie J. Thomsen                  MFS Government Markets Income Trust                      N                    D          
Robert W. Uek                      MFS Government Markets Income Trust                      B                    D          

....                                                                            

[Page 13]                                                                       

1 

SC 14D9
16th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 16th
Trustee Compensation Table                                                      

The table below shows the cash compensation paid to the Trustees by the Trust   
for the fiscal year ended November 30, 2006. Interested Trustees receive no     
compensation from the Trust for their services as Trustees. The table includes  
information for Ms. Amy B. Lane, who retired as Trustee of the Trust on February
22, 2006.                                                                       

                                                        [Enlarge/Download Table]

                                                                                                                           
                                                                                                       Total Cash          
                                                                      Retirement Benefits             Compensation         
                                            Trustee Fees              Accrued as Part of             from Trust and        
Name of Trustee(1)                           from Trust                  Trust Expense               Fund Complex(2)       
------------------------------------ ---------------------------- ---------------------------- ----------------------------
------------------------------------ ---------------------------- ---------------------------- ----------------------------
Robert E. Butler(4)                            $5,358                         N/A                       $210,289           
Lawrence H. Cohn, M.D.                         $6,016                       $1,537                      $208,289           
David H. Gunning                               $5,820                         N/A                       $219,642           
William R. Gutow                               $6,016                         N/A                       $208,289           
Michael Hegarty                                $6,020                         N/A                       $209,289           
J. Atwood Ives                                 $6,335                         $0                        $285,289           
Amy B. Lane(3)                                 $2,020                         N/A                       $ 50,423           
Lawrence T. Perera                             $6,079                         $0                        $228,289           
J. Dale Sherratt                               $6,158                       $1,390                      $250,289           
Laurie J. Thomsen                              $6,020                         N/A                       $209,289           
Robert W. Uek(4)                               $5,408                         N/A                       $227,789           

(1) Each Trustee who is an "interested person" of MFS within the meaning of the 
1940 Act (Pozen and Manning) serves without any compensation from the Trust.    
(2) For  calendar  year 2006.  Trustees  receiving  compensation  from the Trust
served as Trustee of 97 funds within the MFS Fund Complex (having  aggregate net
assets at December 31, 2006 of approximately $102 billion).                     
(3) Ms. Lane retired as a Trustee of the Trust on February 22, 2006.            
(4) Messrs. Butler and Uek became Trustees of the Trust on January 1, 2006.     

Retirement Benefit Deferral Plan -- Under a Retirement Benefit Deferral Plan,   
certain Trustees have deferred benefits from a prior retirement plan. The value 
of the benefits is periodically readjusted as though the Trustee had invested an
equivalent amount in Class A shares of other fund(s) designated by such Trustee.
The value of the deferred benefits will be paid to the Trustees upon retirement 
or thereafter. The plan does not obligate a Fund to retain the services of any  
Trustee or pay any particular level of compensation to any Trustee. The plan is 
not funded and a Fund's obligation to pay the Trustee's deferred compensation is
a general unsecured obligation.                                                 

....                                                                            

[Page 19]                                                                       

TRUST INFORMATION                                                               
....                                                                            

Investment Adviser and Administrator                                            
The Trust engages as its investment  adviser and  administrator  MFS, a Delaware
corporation with offices at 500 Boylston Street,  Boston,  Massachusetts  02116.
MFS is a  majority  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., 500 Boylston Street, Boston, Massachusetts
02116, which in turn is a wholly-owned  subsidiary of Sun Life Assurance Company
of  Canada--U.S.  Operations  Holdings,  Inc.,  One  Sun  Life  Executive  Park,
Wellesley Hills,  Massachusetts  02481 ( "Sun Life U.S.  Operations "). Sun Life
U.S.  Operations is a wholly-owned  subsidiary of Sun Life Financial  Corp., 150
King  Street  West,  Toronto,  Canada MSH 1J9,  which in turn is a  wholly-owned
subsidiary of Sun Life Financial Inc.                                           

2 

SC 14D9
17th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 17th
                                                                  Exhibit (e)(2)

 INVESTMENT ADVISORY AGREEMENT

        INVESTMENT ADVISORY AGREEMENT, dated this 1st day of January, 2002, by
and between MFS GOVERNMENT MARKETS INCOME TRUST, a Massachusetts business trust 
(the "Trust"), and MASSACHUSETTS FINANCIAL SERVICES COMPANY, a Delaware         
corporation (the "Adviser").                                                    

 WITNESSETH:

    WHEREAS, the Trust is engaged in business as an investment company
registered under the Investment Company Act of 1940; and                        

        WHEREAS,  the  Adviser is willing to provide  services to the Trust on
the terms and conditions hereinafter set forth;                                 

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
of the parties hereto as herein set forth, the parties covenant and agree as    
follows:                                                                        

     Article 1. Duties of the Adviser. (a) The Adviser shall provide the
Trust with such investment advice and supervision as the latter may from time to
time consider necessary for the proper supervision of its assets. The Adviser   
shall act as investment adviser to the Trust and as such shall furnish          
continuously an investment program and shall determine from time to time what   
securities or other instruments shall be purchased, sold or exchanged and what  
portion of the assets of the Trust shall be held uninvested, subject always to  
the restrictions of the Trust's Amended and Restated Declaration of Trust, dated
January 1, 2002, and By-Laws, each as amended from time to time (respectively,  
the "Declaration" and the "By-Laws"), to the provisions of the Investment       
Company Act of 1940 and the Rules, Regulations and orders thereunder and to the 
Trust's then-current Prospectus and Statement of Additional Information. The    
Adviser also shall exercise voting rights, rights to consent to corporate       
actions and any other rights pertaining to the Trust's portfolio securities in  
accordance with the Adviser's policies and procedures as presented to the       
Trustees of the Trust from time to time. Should the Trustees at any time,       
however, make any definite determination as to the investment policy and notify 
the Adviser thereof in writing, the Adviser shall be bound by such determination
for the period, if any, specified in such notice or until similarly notified    
that such determination shall be revoked.                                       

       (b) The Adviser shall take, on behalf of the Trust, all actions which
it deems necessary to implement the investment policies determined as provided  
above, and in particular to place all orders for the purchase or sale of        
portfolio securities or other instruments for the Trust's account with brokers  
or dealers selected by it, and to that end, the Adviser is authorized as the    
agent of the Trust to give instructions to the Custodian of the Trust as to the 
deliveries of securities or other instruments and payments of cash for the      
account of the Trust. In connection with the                                    

1 

SC 14D9
18th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 18th
selection of such brokers or dealers and the placing of such orders, the Adviser
is directed to seek for the Trust the best overall price and execution available
from  responsible  brokerage  firms,  taking  account  of all  factors  it deems
relevant, including by way of illustration:  price; the size of the transaction;
the nature of the market for the  security;  the amount of the  commission;  the
timing and impact of the  transaction  taking  into  account  market  prices and
trends;  the  reputation,  experience  and financial  stability of the broker or
dealer involved; and the quality of services rendered by the broker or dealer in
other  transactions.  In fulfilling this  requirement,  the Adviser shall not be
deemed to have acted  unlawfully or to have  breached any duty,  created by this
Agreement or otherwise, solely by reason of its having caused the Trust to pay a
broker or dealer an amount of commission for effecting a securities  transaction
in excess of the  amount  of  commission  another  broker or dealer  would  have
charged for effecting that transaction,  if the Adviser determined in good faith
that such amount of  commission  was  reasonable in relation to the value of the
brokerage  and research  services  provided by such broker or dealer,  viewed in
terms  of  either  that   particular   transaction  or  the  Adviser's   overall
responsibilities  with respect to the Trust and to other  clients of the Adviser
as to which the Adviser exercises investment discretion.  Subject to seeking the
best price and execution as described  above,  and in accordance with applicable
rules and  regulations,  the Adviser  also is  authorized  to consider  sales of
shares of the Trust or of other  funds or accounts of the Adviser as a factor in
the selection of brokers and dealers.                                           

 (c) The Adviser may from time to time enter into sub-investment
advisory agreements with respect to the Trust with one or more investment       
advisers with such terms and conditions as the Adviser may determine, provided  
that such sub-investment advisory agreements have been approved in accordance   
with applicable provisions of the Investment Company Act of 1940 and any rules, 
regulations or orders of the Securities and Exchange Commission thereunder.     
Subject to the provisions of Article 6, the Adviser shall not be liable for any 
error of judgment or mistake of law by any sub-adviser or for any loss arising  
out of any investment made by any sub-adviser or for any act or omission in the 
execution and management of the Trust by any sub-adviser.                       

      Article 2. Allocation of Charges and Expenses. (a) The Adviser shall
furnish at its own expense investment advisory and administrative services,     
office space, equipment and clerical personnel necessary for servicing the      
investments of the Trust and maintaining its organization, and investment       
advisory facilities and executive and supervisory personnel for managing the    
investments and effecting the portfolio transactions of the Trust. The Adviser  
shall arrange, if desired by the Trust, for directors, officers and employees of
the Adviser to serve as Trustees, officers or agents of the Trust if duly       
elected or appointed to such positions and subject to their individual consent  
and to any limitations imposed by law.                                          

     (b) It is  understood  that  the  Trust  will  pay all of its own  expenses
incurred in its operations and the offering of its shares,  unless  specifically
provided  otherwise  in this  Agreement or except to the extent that the Adviser
agrees in a written instrument executed by the Adviser  (specifically  referring
to this Article 2(b)) to assume or otherwise  pay for specified  expenses of the
Trust, including, without limitation:  compensation of Trustees "not affiliated"
with the Adviser; governmental fees; interest charges; taxes; membership dues in
the Investment  Company  Institute  allocable to the Trust; fees and expenses of
independent auditors, of legal counsel, and of any transfer agent,  registrar or
dividend  disbursing agent of the Trust;                                        

2 

SC 14D9
19th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 19th
expenses  of  repurchasing  and  redeeming  shares  and  servicing   shareholder
accounts;  expenses  of  preparing,  printing  and mailing  stock  certificates,
shareholder  reports,  notices,  proxy  statements  and reports to  governmental
officers  and  commissions;  brokerage  and other  expenses  connected  with the
execution,   recording  and  settlement  of  portfolio  security   transactions;
insurance  premiums;  fees and expenses of the custodian for all services to the
Trust,  including  safekeeping of funds and securities and maintaining  required
books and accounts; expenses of calculating the net asset value of shares of the
Trust;  organizational  and start up costs; such  non-recurring or extraordinary
expenses as may arise, including those relating to actions, suits or proceedings
to which the Trust is a party or otherwise  may have an exposure,  and the legal
obligation  which the Trust  may have to  indemnify  the  Trust's  Trustees  and
officers  with  respect  thereto;   and  expenses   relating  to  the  issuance,
registration  and  qualification  of shares  of the  Trust and the  preparation,
printing and mailing of  prospectuses  for such  purposes  (except to the extent
that any  Distribution  Agreement  to which the Trust is a party  provides  that
another party is to pay some or all of such expenses).                          

     (c) The payment or assumption by the Adviser of any expenses of the
Trust that the Adviser is not obligated by this Agreement or otherwise to pay or
assume shall not obligate the Adviser to pay or assume the same or any similar  
expenses of the Trust on any subsequent occasion.                               

         Article 3. Compensation of the Adviser. For the services to be rendered
and the facilities provided, the Trust shall pay to the Adviser an investment   
advisory fee computed and paid monthly as set forth in Appendix A attached      
hereto. If the Adviser shall serve for less than the whole of any period        
specified in this Article 3, the compensation paid to the Adviser will be       
prorated.                                                                       

   Article 4. Additional Services. Should the Trust have occasion to
request the Adviser or its affiliates to perform administrative or other        
additional services not herein contemplated or to request the Adviser or its    
affiliates to arrange for the services of others, the Adviser or its affiliates 
will act for the Trust upon request to the best of its ability, with            
compensation for the services to be agreed upon with respect to each such       
occasion as it arises. No such agreement for additional services shall expand,  
reduce or otherwise alter the obligations of the Adviser, or the compensation   
that the Adviser is due, under this Agreement.                                  

      Article 5. Covenants of the Adviser. The Adviser agrees that it will
not deal with itself, or with the Trustees of the Trust or the Trust's          
distributor, if any, as principals in making purchases or sales of securities or
other property for the account of the Trust, except as permitted by the         
Investment Company Act of 1940 and any rules, regulations or orders of the      
Securities and Exchange Commission thereunder, will not take a long or short    
position in the shares of the Trust except as permitted by the applicable law,  
and will comply with all other provisions of the Declaration and the By-Laws and
the then-current Prospectus and Statement of Additional Information of the Trust
relative to the Adviser and its directors and officers.                         

      Article 6. Limitation of Liability of the Adviser. The Adviser shall
not be liable for any error of judgment or mistake of law or for any loss       
arising out of any investment or for any act or omission in the execution and   
management of the Trust, except for willful misfeasance,                        

3 

SC 14D9
20th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 20th
bad faith,  gross negligence or reckless disregard of its duties and obligations
hereunder.  As used  in  this  Article  6,  the  term  "Adviser"  shall  include
directors,  officers and  employees  of the Adviser as well as that  corporation
itself.                                                                         

       Article 7. Activities of the Adviser. (a) The Trust acknowledges that
the services of the Adviser are not exclusive, the Adviser being free to render 
investment advisory and/or other services to others. The Trust further          
acknowledges that it is possible that, based on their investment objectives and 
policies, certain funds or accounts managed by the Adviser or its affiliates may
at times take investment positions or engage in investment techniques which are 
contrary to positions taken or techniques engaged in on behalf of the Trust.    
Notwithstanding the foregoing, the Adviser will at all times endeavor to treat  
all of its clients in a fair and equitable manner.                              

    (b) The Trust acknowledges that whenever the Trust and one or more
other funds or accounts advised by the Adviser have available monies for        
investment, investments suitable and appropriate for each shall be allocated in 
a manner believed by the Adviser to be fair and equitable to each entity.       
Similarly, opportunities to sell securities or other investments shall be       
allocated in a manner believed by the Adviser to be fair and equitable to each  
entity. The Trust acknowledges that in some instances this may adversely affect 
the size of the position that may be acquired or disposed of for the Trust.     

      (c) It is understood that the Trustees, officers and shareholders of
the Trust are or may be or become interested in the Adviser, as directors,      
officers, employees, or otherwise and that directors, officers and employees of 
the Adviser are or may become similarly interested in the Trust, and that the   
Adviser may be or become interested in the Trust as a shareholder or otherwise. 

Article 8. MFS Name. The Trust acknowledges that the names    
"Massachusetts Financial Services," "MFS" or any derivatives thereof or logos   
associated with those names (collectively, the "MFS Marks") are the valuable    
property of the Adviser and its affiliates. The Adviser grants the Trust a      
non-exclusive and non-transferable right and sub-license to use the MFS Marks   
only so long as the Adviser serves as investment adviser to the Trust. The Trust
agrees that if the Adviser for any reason no longer serves as investment adviser
to the Trust, and the Adviser so requests, the Trust promptly shall cease to use
the MFS Marks and promptly shall amend its registration statement to delete any 
references to the MFS Marks. The Trust acknowledges that the Adviser may permit 
other clients to use the MFS Marks in their names or other material. For        
purposes of this Article, the Trust shall be deemed to have taken the required  
action "promptly" if such action is taken within 90 days of the Adviser no      
longer serving as the investment adviser to the Trust, or from the date of the  
Adviser's request, as the case may be.                                          

       Article 9. Duration, Termination and Amendment of this Agreement. (a)
This Agreement shall become effective with respect to the Trust on the date     
first written above. Thereafter, this Agreement will remain in effect with      
respect to the Trust for a period of two years from the date first written      
above, on which date it will terminate for the Trust unless its continuance is  
"specifically approved at least annually" (i) by the vote of a majority of the  
Trustees of the Trust who are not "interested persons" of the Trust or of the   
Adviser at a meeting                                                            

4 

SC 14D9
21st Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 21st
specifically called for the purpose of voting on such approval,  and (ii) by the
Board of  Trustees of the Trust,  or by "vote of a majority  of the  outstanding
voting securities" of the Trust.                                                

  (b) This Agreement may be terminated as to the Trust at any time
without the payment of any penalty by the Trustees or by "vote of a majority of 
the outstanding voting securities" of the Trust, or by the Adviser, in each case
on not more than sixty days' nor less than thirty days' written notice to the   
other party. This Agreement shall automatically terminate in the event of its   
"assignment".                                                                   

     (c) This Agreement may be amended with respect to the Trust only if
such amendment is in writing signed by or on behalf of the Trust and the Adviser
and is approved by "vote of a majority of the outstanding voting securities" of 
the Trust (if such shareholder approval is required by the Investment Company   
Act of 1940).                                                                   

 Article 10. Scope of Trust's Obligations. A copy of the Trust's
Declaration of Trust is on file with the Secretary of State of The Commonwealth 
of Massachusetts. The Adviser acknowledges that the obligations of or arising   
out of this Agreement are not binding upon any of the Trust's Trustees,         
officers, employees, agents or shareholders individually, but are binding solely
upon the assets and property of the Trust.                                      

      Article 11. Definitions and Interpretations. The terms "specifically
approved at least annually," "vote of a majority of the outstanding voting      
securities," "assignment," "affiliated person," and "interested person," when   
used in this Agreement, shall have the respective meanings specified, and shall 
be construed in a manner consistent with, the Investment Company Act of 1940 and
the rules and regulations promulgated thereunder. Any question of interpretation
of any term or provision of this Agreement having a counterpart in or otherwise 
derived from a term or provision of the Investment Company Act of 1940, the     
Investment Advisers Act of 1940, the Securities Act of 1933, or the Securities  
Exchange Act of 1934 (collectively, the "Federal Securities Acts") shall be     
resolved by reference to such term or provision of the Federal Securities Acts  
and to interpretations thereof, if any, by United States federal courts or, in  
the absence of any controlling decisions of any such court, by rules or         
regulations of the Securities and Exchange Commission. Where the effect of a    
requirement of the Federal Securities Acts reflected in any provision of this   
Agreement is revised by rule or regulation of the Securities and Exchange       
Commission, such provisions shall be deemed to incorporate the effect of such   
rule or regulation.                                                             

         Article 12. Record Keeping. The Adviser will maintain records in a form
acceptable to the Trust and in compliance with the rules and regulations of the 
Securities and Exchange Commission, including but not limited to records        
required to be maintained by Section 31(a) of the Investment Company Act of 1940
and the rules thereunder, which at all times will be the property of the Trust  
and will be available for inspection and use by the Trust.                      

        Article 13.  Miscellaneous.  (a) This  Agreement  contains  the entire
understanding  and  agreement  of the parties  with  respect to the subject     
matter hereof.                                                                  

5 

SC 14D9
22nd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 22nd
     (b) Headings in this Agreement are for ease of reference only and shall not
constitute a part of the Agreement.                                             

     (c) Should any portion of this Agreement for any reason be held void in law
or equity,  the  remainder  of the  Agreement  shall be  construed to the extent
possible as if such voided portion had never been contained herein.             

     (d) This  Agreement  shall be governed by the laws of the  Commonwealth  of
Massachusetts,  without giving effect to the choice of laws provisions  thereof,
except that questions of interpretation shall be resolved in accordance with the
provisions of Article 11 above.                                                 

6 

SC 14D9
23rd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 23rd
           IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered in their names and on their behalf by the
undersigned officers thereunto duly authorized, all as of the day and year first
above written. The undersigned officer of the Trust has executed this Agreement 
not individually, but as an officer under the Declaration and the obligations of
this Agreement are not binding upon any of the Trustees, officers or            
shareholders of the Trust, individually, but bind only the trust estate.        

                                   MFS GOVERNMENT MARKETS INCOME TRUST

                               By: /s/ James R. Bordewick, Jr.
                                       -------------------------------
                              Name:  James R. Bordewick, Jr.
                           Title:  Assistant Secretary

                                MASSACHUSETTS FINANCIAL SERVICES
       COMPANY

                        By:/s/ Jeffrey L. Shames
                              ------------------------------
                        Name:  Jeffrey L. Shames
                Title:  Chairman

7 

SC 14D9
24th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 24th
Appendix A

 Compensation to the Adviser

The investment advisory fee payable by the Trust shall be computed and paid     
monthly in an amount equal to the sum of .32% of the Trust's average daily net  
assets plus 5.33% of the Trust's gross income (i.e., income other than gains    
from the sale of securities, short-term gains from options and futures          
transactions and premium income from options written), in each case on an annual
basis for the Trust's then-current fiscal year.                                 

1 

SC 14D9
25th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 25th
                                                                  Exhibit (e)(3)

 CLOSED-END FUND OVERSIGHT AGREEMENT

CLOSED-END FUND OVERSIGHT AGREEMENT effective the 1st day of January 1, 2007, by
and among MFS Service Center, Inc., a Delaware corporation (the                 
"Administrator"), and each of the closed-end funds identified from time to time 
on Exhibit A hereto (each a "Fund" and collectively the "Funds").               

W I T N E S S E T H:

WHEREAS, the Funds have engaged Computershare Trust Company, N.A.               
("Computershare") as the sole transfer agent for the Funds pursuant to that     
certain Transfer Agency and Service Agreement dated as of December 18, 2006 by  
and among the Funds, Computershare and Computershare Shareholder Services, Inc. 
("CSS") (the "TA Agreement") pursuant to which Computershare provides transfer  
agency services to the Funds and CSS acts as the agent for the Funds' dividend  
reinvestment plans;                                                             

WHEREAS, the Funds desire to retain the Administrator to provide oversight      
services with respect to the performance by Computershare and CSS of their      
respective obligations to the Funds under the TA Agreement in the manner and on 
the terms and conditions hereinafter set forth;                                 

NOW THEREFORE, in consideration of the mutual covenants and agreements of the   
parties hereto and hereinafter set forth, the parties covenant and agree as     
follows:                                                                        

1. Oversight Services. The Administrator shall, at its expense (subject to      
Sections 2 and 3 hereof), and subject always to the control of the trustees,    
directors or other governing body of the Funds (referred to herein as           
"Trustees"), oversee the performance by Computershare and CSS of their          
respective obligations to the Funds under the TA Agreement (the "Oversight      
Services"). Exhibit B hereto lists the Oversight Services to be provided by the 
Administrator hereunder. If there occurs a material change in the level of      
oversight required by the Funds in the future necessitating a material increase 
or decrease the types or quantities of Oversight Services required by the Funds,
the Funds and the Administrator shall negotiate in good faith an adjustment to  
the Oversight Fee payable under Section 5 hereof.                               

2. Responsibility for Charges and Expenses. During the term of this Agreement,  
the Administrator will pay all expenses incurred by it in connection with its   
obligations under this Agreement, except such expenses as are assumed by the    
Funds under this Agreement and any expenses that are paid by the Funds or by a  
party other than the Funds on behalf of the Funds under the terms of any other  
agreement to which the Funds are a party or a third-party beneficiary. The      
Administrator assumes and shall pay for maintaining its staff and personnel and 
shall, at its own expense, provide the equipment, office space, and facilities  
necessary to perform its obligations under this Agreement.                      

3. Services Provided by Third Parties. It is acknowledged and agreed that the   
Funds shall remain obligated to bear all costs incurred by the Funds pursuant to
the TA Agreement (including all per account fees and out-of-pocket expenses) and
that the Administrator shall not be obligated for any such costs.               

4. Maintenance of Books and Records. It is acknowledged and agreed that (a) the 
Administrator shall have no obligation to preserve for each Fund that is        
registered as an investment company with the Securities and Exchange Commission 
(the "SEC") any records required to be maintained as prescribed by the rules and
regulations of the SEC and (b) such record keeping obligations are the sole     
responsibility of Computershare and CSS pursuant to the terms of the TA         
Agreement.                                                                      

1 

SC 14D9
26th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 26th
5. Oversight Fee. Each Fund shall pay the Administrator a fee as agreed to from 
time to time and as set forth in Exhibit C hereto (the "Oversight Fee"). The    
Oversight Fee shall be accrued on the first day of each calendar month and shall
be paid monthly to the Administrator on the second to last business day of each 
calendar month. If this Agreement becomes effective or terminates before the end
of any calendar month, the Oversight Fee for the period from the effective date 
to the end of such calendar month or from the beginning of such calendar month  
to the date of termination, as the case may be, shall be prorated according to  
the proportion which such period bears to the full month in which such          
effectiveness or termination occurs.                                            

6. Non-Exclusivity. The services of the Administrator to the Funds hereunder are
not to be deemed exclusive and the Administrator shall be free to render similar
services to others.                                                             

7. Standard of Care. Neither the Administrator, nor any of its directors,       
officers, stockholders, agents or employees, shall be liable or responsible to  
any Fund or its shareholders for any error of judgment, mistake of law or any   
loss arising out of any act or omission in the performance by the Administrator 
of its duties under this Agreement, except for liability resulting from (a)     
willful misfeasance, (b) bad faith, (c) gross negligence, or (d) reckless       
disregard by the Administrator of its obligations and duties under this         
Agreement.                                                                      

8. Term, Termination, Amendment and Assignment. This Agreement shall begin on   
the date first written above and shall continue indefinitely with respect to    
each Fund until terminated as follows:                                          

         (i) the Agreement may be terminated at any time, without payment of any
penalty, by the Trustees of the Fund upon sixty (60) days' written notice to the
Administrator;                                                                  

        (ii) the Agreement may be terminated by the Administrator with respect
to any Fund at any time upon sixty (60) days' written notice to the Fund; and   

(iii) if the Trustees of the Fund, including a majority of the
Independent Trustees, do not specifically approve at least annually the         
continuance of this Agreement, then this Agreement shall automatically terminate
at the close of business on the anniversary of its execution, or upon the       
expiration of one year from the effective date of the last such continuance,    
whichever is later.                                                             

  This Agreement may be amended at any time by a written agreement
executed by each party hereto and may be assigned with respect to any Fund only 
with the written consent of the Fund and the Administrator.                     

9. Miscellaneous.                                                               

    a.       Captions. The captions in this Agreement are included for
         convenience of reference only and in no way define or
              delineate any of the provisions hereof or otherwise affect
their construction or effect.               

   b.       Governing Law. The provisions of this Agreement shall be
             construed and interpreted in accordance with the domestic
                  substantive laws of The Commonwealth of Massachusetts, without
            giving effect to any conflicts or choice of laws rule or
                  provision that would result in the application of the domestic
substantive laws of any other jurisdiction. 

         c.       Counterparts. This Agreement may be executed simultaneously in
              two or more counterparts, each of which shall be deemed an
                original, but all of which together shall constitute one and
the same instrument.                        

   d.       Joinder of Funds. In the event that additional funds are
                created or acquired from time to time which desire to retain
             the Administrator to provide them with Oversight Services
         pursuant to this Agreement, the Administrator and the
                  additional fund may jointly amend Schedule A hereto to add the
                additional fund, and the additional fund shall thereafter be
deemed a "Fund" for all                     

2 

SC 14D9
27th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 27th
                purposes of this Agreement. The consent of the other parties
                to this Agreement  shall not be required to amend Schedule A
hereto.                                     

         e.       Scope of  Fund's  Obligations.  A copy of the  Declaration  of
                Trust of each  Fund (or trust of which the Fund is a series)
                organized  as  a   Massachusetts   business  trust  (each  a
                "Trust"),  is on file  with  the  Secretary  of State of The
                Commonwealth    of    Massachusetts.    The    Administrator
                acknowledges  that the obligations of or arising out of this
                Agreement  are not binding  upon any of a Trust's  Trustees,
                officers,  employees,  agents or shareholders  individually,
                but are binding  solely upon the assets and  property of the
                Trust  in  accordance   with  its   proportionate   interest
                thereunder and hereunder. If this Agreement is executed by a
                Trust on behalf  of one or more  series  of the  Trust,  the
                Administrator  further  acknowledges  that  the  assets  and
                liabilities  of each  series of the Trust are  separate  and
                distinct and that the  obligations of or arising out of this
                Agreement are binding  solely upon the assets or property of
                the  series on whose  behalf  the Trust  has  executed  this
                Agreement.   The   Administrator   also   agrees   that  the
                obligations of each Fund hereunder shall be separate and not
                joint  nor  joint  and  several,   in  accordance  with  its
                proportionate interest hereunder,  and agrees not to proceed
                (by way of claim, set-off or otherwise) against any Fund for
the obligations of another Fund.            

3 

SC 14D9
28th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 28th
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed  
by their respective officers thereunto duly authorized and their respective     
corporate seals to be hereunto affiliated, as of the date first written above.  

                                     On behalf of the MFS Closed-End Funds
                          listed on Exhibit A hereto

                        By:  /s/ Susan S. Newton
                                       ---------------------------------------
                                 Susan S. Newton
                                     Assistant Secretary

                        MFS SERVICE CENTER, INC.

                          By: /s/ Maureen Leary-Jago
                                       ---------------------------------------
                                  Maureen Leary-Jago
                         President

4 

SC 14D9
29th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 29th
                                                           As of January 1, 2007

Closed-End Fund Oversight Agreement - Exhibit A 

Item 10.  Funds                                                                 

MFS Closed-End Funds                                                            
MFS Charter Income Trust                                  
MFS Government Markets Income Trust                       
MFS Intermediate Income Trust                             
MFS Multimarket Income Trust                              
MFS Municipal Income Trust                                
MFS Special Value Trust                                   

1 

SC 14D9
30th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 30th
                                    Oversight Services                 Exhibit B

                                                        [Enlarge/Download Table]

                                                                                                                              
----------------------------- -------------------------------------------       -----------------------------------------     
         OVERSIGHT                     JAN '07 - JUNE '07 (2FTES)                  JULY '07 - DEC'07 (1FTE)                   
         SERVICES                                                                                                             
----------------------------- -------------------------------------------       -----------------------------------------     
----------------------------- -------------------------------------------       -----------------------------------------     
1.   Relationship             |X| Establish single point of                     |X| Maintain single point of                  
     Management                   contact for Computershare, enabling               contact for Computershare,                
                                  centralized and consolidated                      enabling centralized and                  
                                  monitoring, reporting and evaluation              consolidated monitoring,                  
                                  of service delivery.                              reporting and evaluation of               
                              |X| Handle operational transition                     service delivery.                         
                                  issues, inclusive of coordinating             |X| Primary liaison between MFS,              
                                  problem resolution, coordination                  Computershare and custodian.              
                                  with Fund Treasury and custodian              |X| Review all policy and process             
                              |X| Validate monthly dividend                         changes that have potential impact to our 
                                  funding approval and DRIP share                   servicing                                 
                                  allocations with Computershare, Fund          [X] Review all personnel, control or servicing
                                  Treasury, and State Street until transitioned     modifications prior to                    
                                  to Fund Treasury.                                 implementation.                           
                              |X| Coordinate transition of                      |X| Conduct quarterly training for            
                                  residual items inclusive of change                staff on MFS products and                 
                                  in DRP agent (May '01); closure of                expectations                              
                                  MFSC TA DDA and conversion of                 |X| Validate invoices and                     
                                  outstanding checks.                               out-of-pocket expenses. Provide           
                              |X| Establish invoice and                             periodic internal reporting               
                                  out-of-pocket validation process,                 inclusive of BOD reporting as             
                                  inclusive of training on                          required.                                 
                                  Computershare web interface.                  |X| Discuss any changes in                    
                              |X| Establish internal reporting and                  products and services offered and         
                                  performance reporting mechanism,                  marketing strategies                      
                                  inclusive of BOD reporting as                 |X| Review any changes to third               
                                  required.                                         party service providers or other          
                                                                                    technology vendors; and                   

----------------------------- ------------------------------------------- -----------------------------------------           
----------------------------- ------------------------------------------- -----------------------------------------           
2.   Establishment and        |X| Coordinate with Computershare for the         |X| Monitor SLA                               
     monitoring of                generation of monthly SLA                     |X| Conduct monthly service level             
     service levels               reporting package in accordance with              review meetings.  Develop and             
                                  MFSC standards                                    monitor srvice improvement                
                              |X| Establish monitoring program with                 plans with vendor                         
                                  Computershare                                 |X| Review samples of all print               
                              |X| Monitor SLA performance                           mail items prior to mailing.              
                              |X| Implement and monitor                             Monitor Shareholder Client                
                                  Shareholder Client Feedback mechanism             Feedback                                  
                              |X| Conduct monthly review meetings                                                             
----------------------------- ------------------------------------------- -----------------------------------------           
----------------------------- ------------------------------------------- -----------------------------------------           
3.   Evaluation of            |X| Validate and, if necessary,                   |X| Annual evaluation SAS 70                  
     third party audit            establish appropriate user controls               report inclusive of monitoring            
     reports, inclusive           identified in SAS 70                              of user controls                          
     SAS 70 reports           |X| (Evaluation SAS 70 conducted as               |X| Continuous follow up                      
                                  part of RFP)                                      open items or exceptions noted            

----------------------------- ------------------------------------------- -----------------------------------------           
----------------------------- ------------------------------------------- -----------------------------------------           
4.   Compliance with          |X| Validate and document compliance              |X| Periodic review and validation of         
     Fund Documents and           with Fund Documents                               compliance with fund documents            
     relevant MFS policy                                                                                                      
                              |X| Update DRP Brochure for changes                                                             
                                  in Transfer Agent - issuance dates                                                          
                                  and coordinate distribution with                                                            
                                  Legal and MarComm                                                                           
----------------------------- ------------------------------------------- -----------------------------------------           

2 

SC 14D9
31st Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 31st
                                                        [Enlarge/Download Table]

                                                                                                                   
----------------------------- ------------------------------------------- -----------------------------------------
         OVERSIGHT                     JAN '07 - JUNE '07 (2FTES)                  JULY '07 - DEC'07 (1FTE)        
         SERVICES                                                                                                  
          SERVICES                                                                                                 
----------------------------- ------------------------------------------- -----------------------------------------
----------------------------- ------------------------------------------- -----------------------------------------
5.   Management               |X| Establish management                          |X| Monitor compliance with        
     certifications               certification process - SOX 404 &                 quarterly certifications  and  
                                  internal control validation, and 38A1             evaluate results               

                              |X| Monitor compliance and evaluate               |X| Follow up on any open items or 
                                  results                                           exceptions noted               

                              |X| Review and validate 38a1                                                         
                                  documentation                                                                    
----------------------------- ------------------------------------------- -----------------------------------------
----------------------------- ------------------------------------------- -----------------------------------------
6.   Periodic due             |X| Conduct due diligence meetings                |X| Conduct due diligence meetings 
     diligence visits             as deemed necessary.                              as deemed necessary            
----------------------------- ------------------------------------------- -----------------------------------------
----------------------------- ------------------------------------------- -----------------------------------------
7.   Conformance with         |X| Establish process for monitoring              |X| Perform periodic monitoring of 
     contractual terms.           for conformance with contractual                  contractual terms              
                                  terms.                                                                           

----------------------------- ------------------------------------------- -----------------------------------------

3 

SC 14D9
32nd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 32nd
                                                                     Exhibit C

 Oversight Fee

    In return for the Oversight Services provided by the Administrator
under this Agreement, the Funds shall pay the Administrator an aggregate monthly
fee of $20,833, such fee to be allocated by the Funds across all open accounts  
being maintained by the Funds.                                                  

4 

SC 14D9
33rd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 33rd
                                                                  Exhibit (e)(4)
MASTER ADMINISTRATIVE SERVICES AGREEMENT

Amended and Restated
August 1, 2006

Exhibit A, as revised:

February 27, 2007 (Addition of MFS Series Trust XIV)

May 1, 2007 (Redesignation of MFS Capital Opportunities Series to 
MFS Core Equity Series) 

June 22, 2007 (Termination of AGF, MVF, IBF and MMB)

June 29, 2007 (Addition of CCA, CXE, CMK, CIF, CXH, CMU)

August 1, 2007 (Termination of MFS Institutional International Research Equity
Fund and MFS Institutional Municipal Money Market Portfolio)

Exhibit D, as revised:

 August 1, 2007 (Revised Fee Schedule)

1 

SC 14D9
34th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 34th
MASTER ADMINISTRATIVE SERVICES AGREEMENT

MASTER ADMINISTRATIVE SERVICES AGREEMENT initially dated the 1st day of March,  
1997, and as amended and restated on this 1st day of August, 2006, by and among 
Massachusetts Financial Services Company, a Delaware corporation (the           
"Administrator"), and each of the funds (or trusts acting on behalf of their    
series) identified from time to time on Exhibit A hereto (each a "Fund" and     
collectively the "Funds").                                                      

W I T N E S S E T H:

WHEREAS, the Funds have entered into Investment Advisory Agreements with the    
Administrator (the "Advisory Agreements") pursuant to which the Administrator   
provides investment advisory services to the Funds;                             

WHEREAS, the Funds desire to retain the Administrator to render the legal,      
financial administration and other administrative services required by the Funds
in the manner and on the terms and conditions hereinafter set forth;            

NOW THEREFORE, in consideration of the mutual covenants and agreements of the   
parties hereto and hereinafter set forth, the parties covenant and agree as     
follows:                                                                        

1. Administrative Services. The Administrator shall, at its expense (subject to 
Sections 2 and 3 hereof), and subject always to the control of the trustees,    
directors or other governing body of the Funds (referred to herein as           
"Trustees"), manage, supervise and conduct all of the day-to-day and ordinary   
course non-investment related affairs and business of the Funds and matters     
incidental thereto not required to be provided by the Administrator under the   
Advisory Agreements (together "Administrative Services"). Exhibit B hereto lists
various categories of Administrative Services to be provided by the             
Administrator hereunder, it being understood that such list is not exhaustive   
and that the Funds may require Administrative Services in addition to those     
specified or referenced in Exhibit B. If there occurs a material change in the  
laws, rules or regulations governing the Funds or related Fund policies that    
materially increase or decrease the types or quantities of Administrative       
Services required by the Funds, the Funds and the Administrator shall negotiate 
in good faith an adjustment to the Administrative Fee payable under Section 5   
hereof. In the performance of its duties, the Administrator will comply with the
provisions of the Declaration of Trust and Bylaws of each Fund and applicable   
law, and shall comply with such compliance and other policies and procedures as 
the Trustees may adopt, approve or determine from time to time.                 

2. Responsibility for Charges and Expenses. During the term of this Agreement,  
the Administrator will pay all expenses incurred by it in connection with its   
obligations under this Agreement, except such expenses as are assumed by the    
Funds under this Agreement and any expenses that are paid by the Funds or by a  
party other than the Funds on behalf of the Funds under the terms of any other  
agreement to which the Funds are a party or a third-party beneficiary. The      
Administrator further agrees to pay or cause its affiliates to pay all salaries,
fees, and expenses of any officer or Trustee of the Funds who is an officer,    
director, or employee of the Administrator or an affiliate of the Administrator.
The Administrator assumes and shall pay for maintaining its staff and personnel 
and shall, at its own expense, provide the equipment, office space, and         
facilities necessary to perform its obligations under this Agreement.           
The Administrator shall not, under the terms of this Agreement, bear the        
categories of expenses listed on Exhibit C hereto (although the Administrator or
an affiliate may bear certain of these expenses under one or more other         
agreements).                                                                    

3. Administrative Services Provided by Third Parties. It is acknowledged and    
agreed that the Funds will require and bear the costs of administrative services
to be provided by third parties in addition to Administrative Services which the
Administrator is required to provide or procure at its own expense under this   
Agreement, such as legal services to be provided by legal counsel to the Funds  
and the Trustees who are not "interested persons" (as defined in the Investment 
Company Act of 1940) of the Funds ("Independent Trustees"), and services to be  
provided                                                                        

2 

SC 14D9
35th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 35th
to the Funds by independent  accountants or other auditors or consultants  which
would  otherwise  constitute  Administrative  Services  ("Separate  Third  Party
Services").  It is further  acknowledged and agreed that, from time to time, due
to resource constraints or otherwise, the Administrator may cause or arrange for
third  parties to provide  Administrative  Services  that the  Administrator  is
required to provide or procure at its own expense  under this  Agreement  (e.g.,
the use of outside  legal  counsel to draft  routine  Fund proxy  statements  or
prospectuses)  ("Outsourced  Third Party Services").  Subject to any policies or
procedures that are adopted by the Funds,  the  Administrator  shall pay for the
costs of any  Outsourced  Third Party Service  unless it obtains the approval of
the Trustees (or a committee or other delegate of the Trustees) for the Funds to
bear some or all of such costs prior to causing or arranging for the  Outsourced
Third  Party  Service to be provided to the Funds.  The parties  recognize  that
there may be  circumstances  in which it is unclear  as to whether a  particular
administrative  service  provided by a third party  constitutes a Separate Third
Party Service or an Outsourced  Third Party Service.  Subject to any policies or
procedures that are adopted by the Funds, the  Administrator  shall use its best
efforts  to  identify  and bring  such  circumstances  to the  attention  of the
Trustees, in which case the Trustees shall, in good faith, determine whether the
particular  service  constitutes a Separate Third Party Service or an Outsourced
Third Party Service for purposes of this Agreement. (1)                         

4. Maintenance of Books and Records. With respect to the provision of           
Administrative Services, the Administrator will preserve for each Fund that is  
registered as an investment company with the Securities and Exchange Commission 
(the "SEC") all records required to be maintained as prescribed by the rules and
regulations of the SEC in the manner and for the time periods prescribed by such
rules. The Administrator agrees that all such records shall be the property and 
under the control of each Fund for which they are maintained and shall be made  
available, within five business days of any request therefore, to the Fund's    
Trustees or independent accountants during regular business hours at the        
Administrator's offices. In the event of termination of this Agreement for any  
reason, all such records shall be returned, without charge, promptly to the     
appropriate Fund, free from any claim or retention of rights by the             
Administrator, except that the Administrator may retain copies of such records. 

5. Administrative Fee. Each Fund shall pay the Administrator a fee as agreed to 
from time to time and as set forth in Exhibit D hereto (the "Administrative     
Fee"). The Administrative Fee shall be accrued for each calendar day and the sum
of the daily fee accruals shall be paid monthly to the Administrator on the     
second to last business day of each calendar month. If this Agreement becomes   
effective or terminates before the end of any calendar month, the Administrative
Fee for the period from the effective date to the end of such calendar month or 
from the beginning of such calendar month to the date of termination, as the    
case may be, shall be prorated according to the proportion which such period    
bears to the full month in which such effectiveness or termination occurs.      

6. Non-Exclusivity. The services of the Administrator to the Funds hereunder are
not to be deemed exclusive and the Administrator shall be free to render similar
services to others.                                                             

7. Standard of Care. Neither the Administrator, nor any of its directors,       
officers, stockholders, agents or employees, shall be liable or responsible to  
any Fund or its shareholders for any error of judgment, mistake of law or any   
loss arising out of any act or omission in the performance by the Administrator 
of its duties under this Agreement, except for liability resulting from (a)     
willful misfeasance, (b) bad faith, (c) gross negligence, or (d) reckless       
disregard by the Administrator of its obligations and duties under this         
Agreement.                                                                      

8. Term, Termination, Amendment and Assignment. This Agreement shall begin on   
the date first written above and shall continue indefinitely with respect to    
each Fund until terminated as follows:                                          

         (i) the Agreement may be terminated at any time, without payment of any
penalty, by the Trustees of the Fund upon sixty (60) days' written notice to the
Administrator;                                                                  
__________________                                                              
(1) The Funds/Trustees and the Administrator may from time to time develop      
written policies designed to delineate various administrative services and      
responsibilities to be provided by third party service providers to the Funds or
the Independent Trustees (for which the Funds bear the associated expenses), on 
the one hand, and those to be provided by the Administrator at is own expense,  
on the other, as well as procedures to be followed by the Administrator in      
utilizing third party service providers on behalf of the Funds. In this regard, 
reference is made to the document entitled "Role of Ropes & Gray LLP as Counsel 
to the MFS Funds and the Independent Trustees," as it may be amended from time  
to time.                                                                        

3 

SC 14D9
36th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 36th
          (ii) the Agreement may be terminated by the Administrator with respect
to any Fund at any time upon sixty (60) days' written notice to the Fund; and   

(iii) if the Trustees of the Fund, including a majority of the
Independent Trustees, do not specifically approve at least annually the         
continuance of this Agreement, then this Agreement shall automatically terminate
at the close of business on the anniversary of its execution, or upon the       
expiration of one year from the effective date of the last such continuance,    
whichever is later.                                                             

  This Agreement may be amended at any time by a written agreement
executed by each party hereto and may be assigned with respect to any Fund only 
with the written consent of the Fund and the Administrator.                     

9. Miscellaneous.                                                               

    a.       Captions. The captions in this Agreement are included for
         convenience of reference only and in no way define or
              delineate any of the provisions hereof or otherwise affect
their construction or effect.               

   b.       Governing Law. The provisions of this Agreement shall be
             construed and interpreted in accordance with the domestic
                  substantive laws of The Commonwealth of Massachusetts, without
            giving effect to any conflicts or choice of laws rule or
                  provision that would result in the application of the domestic
substantive laws of any other jurisdiction. 

         c.       Counterparts. This Agreement may be executed simultaneously in
              two or more counterparts, each of which shall be deemed an
                original, but all of which together shall constitute one and
the same instrument.                        

   d.       Joinder of Funds. In the event that additional funds are
        created from time to time which desire to retain the
              Administrator to provide them with Administrative Services
         pursuant to this Agreement, the Administrator and the
                  additional fund may jointly amend Schedule A hereto to add the
                additional fund, and the additional fund shall thereafter be
           deemed a "Fund" for all purposes of this Agreement. The
               consent of the other parties to this Agreement shall not be
required to amend Schedule A hereto.        

       e.      Scope of Fund's  Obligations.  A copy of the Declaration of
                Trust of each  Fund (or trust of which the Fund is a series)
                organized  as  a   Massachusetts   business  trust  (each  a
                "Trust"),  is on file  with  the  Secretary  of State of The
                Commonwealth    of    Massachusetts.    The    Administrator
                acknowledges  that the obligations of or arising out of this
                Agreement  are not binding  upon any of a Trust's  Trustees,
                officers,  employees,  agents or shareholders  individually,
                but are binding  solely upon the assets and  property of the
                Trust  in  accordance   with  its   proportionate   interest
                thereunder and hereunder. If this Agreement is executed by a
                Trust on behalf  of one or more  series  of the  Trust,  the
                Administrator  further  acknowledges  that  the  assets  and
                liabilities  of each  series of the Trust are  separate  and
                distinct and that the  obligations of or arising out of this
                Agreement are binding  solely upon the assets or property of
                the  series on whose  behalf  the Trust  has  executed  this
                Agreement.   The   Administrator   also   agrees   that  the
                obligations of each Fund hereunder  shall be several and not
                joint  nor  joint  and  several,   in  accordance  with  its
                proportionate interest hereunder,  and agrees not to proceed
                (by way of claim, set-off or otherwise) against any Fund for
the obligations of another Fund.            

4 

SC 14D9
37th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 37th
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed  
by their respective officers thereunto duly authorized and their respective     
corporate seals to be hereunto affiliated, as of the date first written above.  

                           On behalf of the MFS Family
                        of Funds, MFS Closed-End
                           Funds and MFS Institutional
                         Funds listed on Exhibit A
      hereto

                      By: /s/ J. Atwood Ives
                                       ---------------------------------------
                              J. Atwood Ives
                                     Chair of the Trustees

                                        MASSACHUSETTS FINANCIAL SERVICES COMPANY

                         By:   /s/ Robert C. Pozen
                                        ----------------------------------------
                                   Robert C. Pozen
                            Chairman

5 

SC 14D9
38th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 38th
                                                            As of August 1, 2007

Master Administrative Services Agreement - Exhibit A
Funds                                                                           

MFS Family of Funds                                                             

MFS Series Trust I:                                           
-------------------                                           
MFS Cash Reserve Fund                                 
MFS Core Equity Fund                                  
MFS Core Growth Fund                                  
MFS New Discovery Fund                                
MFS Research International Fund                       
MFS Technology Fund                                   
MFS Value Fund                                        

MFS Series Trust II:                                          
MFS Emerging Growth Fund                              

MFS Series Trust III:                                         
MFS High Income Fund                                    
MFS High Yield Opportunities Fund                       
MFS Municipal High Income Fund                          

MFS Series Trust IV:                                          
MFS Government Money Market Fund                        
MFS Mid Cap Growth Fund                                 
MFS Money Market Fund                                   

MFS Series Trust V:                                           
MFS International New Discovery Fund                  
MFS Research Fund                                     
MFS Total Return Fund                                 

MFS Series Trust VI:                                          
MFS Global Equity Fund                                
MFS Global Total Return Fund                          
MFS Utilities Fund                                    

MFS Series Trust VII:                                         

MFS Series Trust VIII:                                        
MFS Global Growth Fund                                
MFS Strategic Income Fund                             

MFS Series Trust IX:                                          
MFS Bond Fund                                         
MFS Inflation-Adjusted Bond Fund                      
MFS Limited Maturity Fund                             
MFS Municipal Limited Maturity Fund                   
MFS Research Bond Fund                                
MFS Research Bond Fund J                              

6 

SC 14D9
39th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 39th
MFS Series Trust X:                                           
MFS Aggressive Growth Allocation Fund                   
MFS Conservative Allocation Fund                        
MFS Emerging Markets Debt Fund                          
MFS Emerging Markets Equity Fund                        
MFS Floating Rate High Income Fund                      
MFS Growth Allocation Fund                              
MFS International Diversification Fund                  
MFS International Growth Fund                           
MFS International Value Fund                            
MFS Moderate Allocation Fund                            
MFS New Endeavor Fund                                   
MFS Strategic Value Fund                                

MFS Series Trust XI:                                          
MFS Mid Cap Value Fund                                  
MFS Union Standard Equity Fund                          

MFS Series Trust XII:                                         
MFS Lifetime Retirement Income Fund                     
MFS Lifetime 2010 Fund                                  
MFS Lifetime 2020 Fund                                  
MFS Lifetime 2030 Fund                                  
MFS Lifetime 2040 Fund                                  
MFS Sector Rotational Fund                              

MFS Series Trust XIII:                                        
MFS Diversified Income Fund                           
MFS Government Securities Fund                        

MFS Series Trust XIV:                                         
MFS Institutional Money Market Portfolio              

MFS Municipal Series Trust:                                   
MFS Alabama Municipal Bond Fund                       
MFS Arkansas Municipal Bond Fund                      
MFS California Municipal Bond Fund                    
MFS Florida Municipal Bond Fund                       
MFS Georgia Municipal Bond Fund                       
MFS Maryland Municipal Bond Fund                      
MFS Massachusetts Municipal Bond Fund                 
MFS Mississippi Municipal Bond Fund                   
MFS New York Municipal Bond Fund                      
MFS North Carolina Municipal Bond Fund                
MFS Pennsylvania Municipal Bond Fund                  
MFS South Carolina Municipal Bond Fund                
MFS Tennessee Municipal Bond Fund                     
MFS Virginia Municipal Bond Fund                      
MFS West Virginia Municipal Bond Fund                 
MFS Municipal Income Fund                             

7 

SC 14D9
40th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 40th
MFS Growth Opportunities Fund                                 

Massachusetts Investors Growth Stock Fund                     

MFS Government Limited Maturity Fund                          

Massachusetts Investors Trust                                 

II.      MFS Closed-End Funds                                                   
--------------------                                          
MFS Charter Income Trust                              
MFS Government Markets Income Trust                   
MFS Intermediate Income Trust                         
MFS Multimarket Income Trust                          
MFS Municipal Income Trust                            
MFS Special Value Trust                               
MFS Special Value Trust                               
MFS California Insured Municipal Fund                 
MFS High Income Municipal Fund                        
MFS InterMarket Income Trust I                        
MFS Intermediate Grade Municipal Trust                
MFS High Yield Municipal Trust                        

III.     MFS Institutional Funds                                                
MFS Institutional International Equity Fund           
MFS Institutional Large Cap Value Fund                

MFS Variable Insurance Trust:                                 
MFS Core Equity Series                                
MFS Emerging Growth Series                            
MFS Global Equity Series                              
MFS High Income Series                                
MFS Investors Growth Stock Series                     
MFS Investors Trust Series                            
MFS Mid Cap Growth Series                             
MFS Money Market Series                               
MFS New Discovery Series                              
MFS Research Bond Series                              
MFS Research International Series                     
MFS Research Series                                   
MFS Strategic Income Series                           
MFS Total Return Series                               
MFS Utilities Series                                  
MFS Value Series                                      

8 

SC 14D9
41st Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 41st
                                                                       Exhibit B

 Administration Services

I.       FINANCIAL ADMINISTRATIVE SERVICES.                                     

A.       General Services.                                    

    1. Prepare such financial information of the Fund as is reasonably
   necessary for reports to shareholders of the Fund, reports to the
     Fund's Trustees and officers, and reports to appropriate regulatory
      authorities including, without limitation, prospectuses, shareholder
   reports, shareholder notices, proxy statements and other periodic
         reports and render statements or copies of records as from time to time
are reasonably requested by the Fund.                         

   2. Facilitate audits of accounts by the Fund's independent public
       accountants or by any of the auditors employed or engaged by the Fund
       or by any regulatory body with jurisdiction over the Fund. Coordinate
       with, and monitor the performance of, the custodian banks retained by
   the Fund to perform the necessary custodial services for the Fund
 including, without limitation, the safekeeping of the funds and
securities.                                                   

     3. Negotiate contracts for computing the Fund's net asset value per
       share, and, if applicable, its public offering price and/or its daily
         dividend rates and money market yields and other investment performance
       quotations, in accordance with sub-paragraph C below, and oversee the
 notification to the Fund and such other persons as the Fund may
 reasonably request of the net asset value per share, the public
        offering price and/or its daily dividend rates and money market yields
      and other investment performance quotations (with the expenses under
such contracts to be paid separately by the Funds).           

     B. Valuation of Securities. The Administrator shall ensure that the
         value of the Fund's securities is computed in accordance with governing
  law, rules and regulations, the Fund's governing instruments and
    subject to the oversight and direction of the Fund's Trustees. The
     Administrator shall oversee the use of one or more external pricing
         services (at the separate expense of the Funds) to provide the value of
         a Fund's securities, including broker/dealers, provided that the Fund's
   Trustees or a committee or an individual designated by the Fund's
Trustees has approved the use of such pricing services.       

       The Administrator shall administer the Valuation Policies approved by
         the Trustees for the Fund, including the implementation and application
         of fair valuation methods and security valuation factors for applicable
      securities and other assets, including those provided by third-party
         service providers at the expense of the Funds, and provide such reports
      to the Fund's Trustees or a committee thereof as is required by such
Policies or otherwise requested.                              

       C.       Computation of Net Asset Value, Public Offering Price, Daily
                Dividend Rates and Performance Quotations. The Administrator
             shall assure that the Fund's net asset value, net income,
                  public offering price, dividend rates and money market yields,
                  if applicable, and other investment performance quotations are
                calculated in a manner and at such time or times as the Fund
                shall direct and in accordance with governing law, rules and
                regulations and the Fund's governing instruments and subject
              to the oversight and direction of the Fund's Trustees. The
               Administrator will oversee the computation of the net asset
            value and public offering price as calculated by service
providers of the Funds.                     

D.       Other Financial Administration Services.             

 1.       Provide Treasurers or Assistant Treasurers to serve as
officers of the Fund;                       

9 

SC 14D9
42nd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 42nd
       2.       Coordinate the meetings of the Audit Committees of the Fund,
           assure that meetings are scheduled and that agendas are
             prepared; participate in meetings of the Audit Committee;

        3.       Review contracts and negotiate fees for the Fund for services
                 such as independent audit fees, custodian fees, bank lines of
             credit, transfer agent fees and the fees of other service
providers to the Fund;                      

   4.       Oversee the preparation of accounting records by service
                providers of the Fund required to be maintained by the Fund.
            Assure that any audit of Fund records is coordinated and
completed timely;                           

  5.       Direct the preparation of Fund Financial Statements and
          Footnotes included in shareholder and other regulatory
              reports. Assure that all statements and disclosures are in
                accordance with generally accepted accounting principles and
          that disclosures meet current regulatory or accounting
                requirements. Establish and maintain disclosure controls and
               internal controls over financial reporting to assist in the
                 Funds' officers certification under the Sarbanes-Oxley Act of
2002;                                       

         6.       Calculate and/or oversee the calculation of income and capital
            gain distributions for applicable funds. Assure that all
                  distributions of the Fund meet the distribution and excise tax
              requirements to assure qualification and to minimize taxes
paid by the Fund;                           

  7.       Establish the tax policies and procedures for the Fund;
                 maintain procedures and policies with respect to tax matters;
                 maintain or oversee the maintenance of certain tax accounting
                  records of the Fund; complete or review tax returns and excise
            tax forms for the Fund; assist in preparing the 1099-DIV
information delivered to shareholders;      

        8.       Prepare materials for the Trustees of the Fund and committees
          thereof, including materials for board meetings and in
          connection with the renewal of investment advisory and
distribution contracts;                     

9. Direct the accrual of Fund expenses; review and approve all invoices         
submitted to the Fund;                                                          

10.               Calculate total return and other performance information for  
each Fund and its respective classes;       

11.               Prepare and file or oversee preparation and review the Funds' 
                annual and semi-annual N-CSR and other periodic reports; and

12.               Administer the Funds' securities lending program.             

II.               LEGAL ADMINISTRATIVE SERVICES.                                

A. Organizational Matters and Initial Registration.           

     1.       Draft, negotiate as appropriate, and file with appropriate
                regulatory authorities the Fund's charter documents, service
          contracts, and registration statement or other similar
              registration documentation (the "Registration Statement"),
                 except that the out-of-pocket expenses incurred in connection
therewith shall be paid by the Funds;       

2.       Otherwise arrange for and oversee registration and   
       qualification of the Fund's shares, except that the
                 out-of-pocket expenses incurred in connection therewith shall
be paid by the Funds.                       

B.       Ongoing Regulatory Filings, Reports and Meetings.    

10

SC 14D9
43rd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 43rd
1.                Prepare and file with appropriate regulatory authorities      
        amendments to the Fund's Registration Statement, and
         supplements to the Fund's prospectus and statement of
additional information;                     

2.                Design and draft documents or materials required to be        
            prepared by or on behalf of the Fund for distribution to
                  shareholders of the Fund, the Fund's Trustees and officers and
               any governmental officers or commissions as required of the
                 Fund including, without limitation, prospectuses, shareholder
      reports, shareholder notices and proxy statements;

3.                Prepare and file or oversee preparation and review and provide
              legal guidance on the Fund's annual, semi-annual and other
 periodic reports and tax filings and reports;

4.                Establish and maintain a disclosure controls and procedures   
                program to assist in the Funds' officers certification under
the Sarbanes-Oxley Act of 2002;             

5.                Develop or assist in developing guidelines and procedures to  
improve overall compliance by the Funds;    

6.                Provide consultation and advice for resolving compliance      
             questions together with the Funds' outside legal counsel;

7.                Prepare and file with appropriate regulatory authorities      
                  various reports in order to maintain the Fund's status in good
standing;                                   

8.                Arrange for and attend shareholders' meetings;                

9.                Prepare the Fund's representatives who will attend shareholder
                meetings and all necessary materials in connection with such
                meetings including, without limitation, a written script for
       such meetings, minutes and any follow-up documents.

C. Securities Trading and Investment Practices.               

1.       Review and negotiate private placement and municipal 
                securities offering documentation and provide legal guidance
on transfer restrictions;                   

         2.       Provide guidance on legal considerations relating to the types
            and levels of ownership of securities, including foreign
securities;                                 

         3.       Draft and negotiate documentation necessary to permit the Fund
               to engage in a variety of derivative and securities trading
              practices and provide legal guidance with respect to these
practices.                                  

    D.       Regulated Activities. Applicable securities laws regulate
           numerous aspects of the Fund's business, including such
            matters as the Fund's: prospectus disclosure; investment
             activities; affiliated transactions; investment in senior
                 securities; sales, redemptions and exchanges; distribution of
                income and capital gains; distribution of Fund shares; board
         composition; code of ethics; fidelity bond; custodial
                 services; and investment advisory and distribution contracts.
               The Administrator will provide the Fund with legal guidance
                with respect to these matters and to the general application
of securities laws to the Fund's business.  

         E.       Tax Considerations. Procure legal guidance with respect to the
                application of tax rules to the Fund and analysis from a tax
                 perspective new types of securities, investment practices and
                  investment products or practices as may be appropriate for the
          Fund (it being understood that such legal guidance and
                analysis provided by third-parties will be at the expense of
the Fund).                                  

F.       Board Matters.                                       

11

SC 14D9
44th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 44th
      1.       Coordinate and prepare agendas and materials for and attend
           board and committee meetings, draft and keep records of
                  minutes of such meetings, and coordinate any follow up issues;
and                                         

     2.       Provide advice and guidance and prepare materials on legal
                 issues relevant to the Fund's business, including composition
of the governing board.                     

G.       Miscellaneous/Extraordinary Events.                  

         1.       Supervise outside legal counsel retained at the expense of the
           Fund with respect to litigation brought by the Fund and
             against the Fund and negotiate litigation settlements and
         pre-litigation settlements and work-out arrangements;

      2.       Obtain the required documentation to be filed in connection
                 with any lawsuits against the Fund and provide information or
                  expertise on administrative matters affecting such litigation;

        3.       Provide legal guidance on alternative distribution structures
             for the Fund's shares (such as the adoption of a multiple
class structure);                           

   4.       Review all contracts concerning the acquisition of other
               investment companies or the liquidation of the Fund, draft,
        negotiate and file various documentation required in
             connection therewith, provide guidance on the manner such
               transactions should be structured to comply with applicable
           law and obtain at the Fund's expense legal opinions and
                regulatory authority rulings necessary for such transactions
to comply with applicable law;              

      5.       Seek formal guidance from regulatory authorities concerning
               the application of various regulations to the Fund and seek
exemptive relief where appropriate; and     

6.       Provide or arrange for all other legal services that 
               constitute Administrative Services required by the Fund and
             not otherwise provided for under this Agreement (it being
                  understood that various legal services will be provided to the
                  Fund and the Independent Trustees at the expense of the Funds,
as described in Section 3 of the Agreement).

12

SC 14D9
45th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 45th
III.     OTHER ADMINISTRATIVE SERVICES.                                         

     1.       Arrange for persons or other entities to serve as transfer
                agent, registrar or dividend disbursing agent as required by
           the Fund, and provide legal guidance on applicable laws
regulating such agents;                     

       2. Arrange for consideration by the Board of appropriate or necessary
insurance coverage for the Fund;                                                

       3. Develop and implement procedures to monitor each Fund's compliance
with:                                                                           

               o    Regulatory  requirements  as  required  by Rule 38a-1 of the
     Investment  Company Act of 1940,  as amended;
               o    Each Fund's  investment  policies  and  restrictions  as set
                    forth in each  Fund's  currently  effective  Prospectus  and
                    Statement  of   Additional   Information   filed  under  the
Securities Act of 1933, as amended;     
               o    Establishing   and  maintaining  an  anti-money   laundering
                    program  to assist  in the  Funds'  compliance  with the USA
Patriot Act and the Bank Secrecy Act;   
o    Performing IRS sub-Chapter M testing;        
               o    Reviewing  and filing with the NASD  semi-annual  and annual
reports;                                
               o    Assisting  in training of certain  MFS  personnel  including
       Portfolio  Managers and other investment staff;
               o    Monitoring "Access Persons" transactions and their adherence
            under the terms of the Funds' Code of Ethics Policy;
               o    Providing assistance and resources to the Funds' Independent
                   Chief Compliance Officer ("ICCO") as requested by the ICCO.

    4.       Prepare, and arrange for the printing and mailing of, any
necessary investment communications;        

   5.       Arrange for the printing and mailing of any documents or
                written materials required to be prepared by or on behalf of
               the Fund including, without limitation, stock certificates,
                 prospectuses, shareholder reports, shareholder notices, proxy
       statements and reports to governmental officers and
commissions;                                

  6.       Arrange for any other printing, production and delivery
                services required of the Fund and not otherwise specifically
provided for under this Agreement;          

      7.       Provide a system of internal controls adequate to carry-out
                 the business of the Fund and arrange for the annual report on
 internal controls of the Fund and its agents;

8.       Review the Fund's disclosure documents to ensure that
         disclosures and policies conform to the Fund's actual
operation;                                  

 9.       Provide for the calculation and timely disbursement of
           appropriate regulatory authority registration fees; and

        10.       Oversee and assist in the coordination of, and as the Trustees
                may reasonably request or deem appropriate, make reports and
          recommendations to the Trustees on, the performance of
                 administrative and professional services rendered to the Fund
               by others, including the custodian, accountants, attorneys,
                underwriters, brokers and dealers, insurers, banks, transfer
                agents and dividend disbursing agents and such other persons
               in any such other capacity deemed necessary or desirable by
the Trustees.                               

13

SC 14D9
46th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 46th
                                                                     Exhibit C

Categories of Non-Administrator Expenses

a.                The fees and expenses described in Article 2(b) or Section    
              2.2(b) of the MFS Family of Funds' Advisory Agreements and
          Article 5 of the MFS/Sun Life Series Trust and Compass
Product's Advisory Agreements.              
b.                Investment advisory fees and other expenses associated with   
       the investment management of the Funds' portfolios.
c.                Costs of brokerage fees, commissions, ticket charges and      
              transfer taxes in connection with the purchase and sale of
        portfolio securities and other assets for the Funds.
d.                Distribution and marketing expenses of the Funds, including   
          Rule 12b-1 fees. e. Expenses of the Funds for transfer
               agent(s), registrar(s) and dividend disbursing agent(s). f.
                Expenses of the Funds for custodian(s) and related custodial
        services. g. Except as described in Section 3 of the
                  Agreement, costs of Fund accounting services provided by third
                parties to the Funds, including the fund accounting services
                  of the type currently provided by State Street Bank to the MFS
Funds.                                      
h.                Except as described in Section 3 of the Agreement, costs of   
                  services provided by independent accountants and outside legal
              and tax counsel to the Funds and the Independent Trustees.
i.                Taxes, if any, levied against the Funds.                      
j.                Costs, including interest expenses, commitment fees,          
                  facilities fees and unused line fees of any borrowings made by
the Funds.                                  
k.                The Funds' allocable portion of the fidelity bond required by 
            Section 17(g) of the Investment Company Act of 1940, and
          directors' and officers' liability and other insurance
premiums.                                   
l.                Proxy filing fees and the costs of printing and mailing of any
               proxy materials for meetings of shareholders' of the Funds.
m.                All applicable registration and filing fees required to be    
              paid by the Funds under federal and state securities laws.
n.                The Funds' allocable portion of expenses of obtaining         
                quotations and other pricing information for calculating the
          value of the Fund's net assets, including the costs of
independent pricing services.               
o.                Fees, expenses and other compensation of or payable by the    
                 Funds to Independent Trustees, including expenses to maintain
                  the Independent Trustees' retirement plan, including actuarial
services provided by Watson Wyatt Wordwide. 
p.                Printing, mailing and filing costs associated with the        
            preparation and distribution of registration statements,
                 prospectuses and reports of the Fund to its shareholders, the
                filing of reports with regulatory bodies, the maintenance of
               the Trust's existence and qualification to do business, and
                the registration of shares with federal and state securities
authorities.                                
q.                Extraordinary expenses as may arise, including judgments and  
                  expenses incurred in connection with litigation, bankruptcies,
             workouts and restructurings, proceedings and other claims
       against the Funds, and the legal obligations of the

14

SC 14D9
47th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 47th
                Funds  to  indemnify  its  trustees,  officers,   employees,
                shareholders, distributors, and agents with respect thereto.
r.                The Funds' allocable portion of dues for membership in various
            industry organizations, including the Investment Company
              Institute, the Independent Directors' Forum and the Mutual
Funds Directors Forum.                      
s.                The costs of third-party software used for the Funds'         
             financial reporting, N-SAR reporting, tax preparation and
                 registration statement preparation as appropriately allocated
to the Funds.                               
t.                Costs of third-party tax notification services used for the   
            Funds (e.g., Ernst & Young's PFIC list). u. The costs of
               third-party legal advice regarding state tax law issues for
              the municipal Funds. v. The allocable costs of third-party
           legal services to review loan documentation for the MFS
Floating Rate                               
              High Income Fund and other Funds that purchase bank loans.
w.                The costs of third-party legal, accounting or other expert    
      advice incurred in connection with an examination,
              investigation, enforcement proceeding, litigation or other
  regulatory proceeding of or against the Funds.

15

SC 14D9
48th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 48th
                                                      Effective August 1, 2007

Master Administrative Services Agreement - Exhibit D

Administrative Fee

         In return for the Administrative Services provided by the Administrator
under this Agreement, each Fund, other than MFS Institutional Money Market      
Portfolio, shall pay the Administrator fees as described below:                 

        (i) Fixed Fee: Regardless of asset size, each Fund shall pay an annual
fee to the Administrator in the amount of $17,500.                              

      (ii) Asset-Based Fee: In addition to the Fixed Fee, each Fund, other
than Funds that invest substantially all of their assets in other Funds ("Asset 
Allocation Funds")(2), shall pay a fee at the following annual rates, stated as 
a percentage of the average daily net assets of the Fund:                       

0.0000% on average daily net assets from $0 to $50 million;           

    0.0155% on average daily net assets in excess of $50 million and less than
or equal to $750 million;                                             

     0.0150% on average daily net assets in excess of $750 million and less than
or equal to $1.5 billion;                                             

     0.0143% on average daily net assets in excess of $1.5 billion and less than
or equal to $2.5 billion;                                             

     0.0120% on average daily net assets in excess of $2.5 billion and less than
or equal to $4.0 billion; and                                         

0.0000% on average daily net assets in excess of $4.0 billion.        

         (iii) Maximum Fees: The maximum aggregate fees payable by the Funds for
the period August 1, 2007, to December 31, 2007, shall be $5.3 million.         

______________________                                                          
(2) The Asset Allocation Funds will only be charged the fixed fee of $17,500.   
The Asset Allocation Funds already incur administrative services fees indirectly
through their holdings in the underlying Funds.                                 

16

SC 14D9
49th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 49th
         IN WITNESS WHEREOF, the parties hereto have caused this Exhibit D to be
signed by their respective officers thereunto duly authorized and their         
respective corporate seals to be hereunto affiliated, as of the date first      
written above.                                                                  

                           On behalf of the MFS Family
                        of Funds, MFS Closed-End
                           Funds and MFS Institutional
                         Funds listed on Exhibit A
                 to this Agreement

                        By:  /s/ Susan S. Newton
                                       ---------------------------------------
                                 Susan S. Newton
                                     Assistant Secretary

                                        MASSACHUSETTS FINANCIAL SERVICES COMPANY

                         By: /s/ Robert J. Manning
                                       ---------------------------------------
                                 Robert J. Manning
                                              Chief Executive Officer, Chief
                                      Investment Officer and
                         President

17

SC 14D9
50th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 50th
                                                                Exhibit (e)(5)
 FIDELITY BOND CLAIM AGREEMENT

     THIS MASTER  FIDELITY  BOND CLAIM  AGREEMENT  dated  November  1,
1993,  as amended and restated June 12, 2002, by and among (i) each of the funds
listed  from  time to time in  Exhibit A  (collectively,  the  "Funds"  or "Fund
Parties") and (ii) Massachusetts Financial Services Company ("MFS"), MFS Service
Center, Inc. ("MFSC"),  MFS Fund Distributors,  Inc. ("MFD"), MFS Heritage Trust
Company, MFS Institutional Advisors,  Inc., MFS International Ltd., MFS Holdings
Australia Pty Ltd., and MFS Retirement Services,  Inc.  (collectively,  the "MFS
Parties").                                                                      

        WHEREAS, MFS or certain other MFS Parties act as investment adviser to
all of the Funds and certain other clients, MFD acts as distributor for certain 
of the Funds and MFSC acts as the transfer and shareholder servicing agent for  
certain of the Funds; and from time to time hereafter each may act in the same  
capacities with respect to other clients including other investment companies;  

   WHEREAS, all the parties hereto are named insureds under broker's
blanket bonds issued by National Union Insurance Company/Federal Insurance      
Company ("National Union"), by Chubb & Sons Insurance Company ("Chubb"), by Gulf
Insurance Company ("Gulf") and by ICI Mutual Insurance Company ("ICI"), and/or  
such other insurance companies as from time to time may insure parties hereto as
such bonds may be amended and/or restated from time to time (collectively the   
"Bonds");                                                                       

        WHEREAS, the parties desire to establish (i) the criteria by which the
premium for the Bonds shall be allocated among the parties, (ii) the basis on   
which additional investment companies for which MFS, or any subsidiary thereof, 
may hereafter act as investment adviser and/or for which MFD may act as         
distributor, and additional affiliates of MFS may from time to time be added as 
named insureds under the Bonds and (iii) the criteria by which losses in excess 
of the face amounts of the Bonds shall be allocated among the parties.          

NOW THEREFORE, it is agreed as follows:                       

1.       Each of the Funds shall pay a portion of each premium which shall be   
       determined as of a specified date (the "Date") which is the same date
      for all Fund Parties by calculating the proportion which the minimum
        amount of fidelity bond coverage required for such Fund (calculated in
         accordance with Rule 17g-1 under the Investment Company Act of 1940, as
         amended, ("Rule 17g-1")) bears to the total amount of coverage provided
      for under the Bonds and applying said proportion to the total annual
     premium. The amount remaining after calculating the portions of the
  premium to be paid by the Funds shall be paid by MFS or such MFS
Parties as MFS shall determine.                               

2.       If National Union, Chubb, Gulf and/or ICI (or such other insurers as   
      from time to time may insure the parties hereto) are willing without
      additional premium until the next renewal date to add, as an insured
    under any of the Bonds, (i) any investment company permitted to be
    included on the Bonds pursuant to Rule 17g-1 for which MFS (or any
        subsidiary thereof) may act as investment adviser and/or for which MFD
      may act as distributor, or (ii) any affiliate of MFS permitted to be
        included on the Bonds pursuant to Rule 17g-1, the parties hereto agree
      (a) that such addition may be made, (b) that such investment company
         shall become a party to this Agreement and be included within the terms
       "Funds" and "Fund Parties" and (c) that such affiliate shall become a
        party to this Agreement and be included within the term "MFS Parties."

3.       In the event that the claims of loss of two or more insureds under the 
      Bonds are so related that the insurer is entitled to assert that the
      claims must be aggregated with the result that the claims exceed the
         face amount of the Bonds but the total amount payable on such claims is
  limited to the face amount of the Bonds, the following rules for
      determining, as among such insureds, the priority of satisfaction of
the claims under the Bonds shall apply:                       

A.       All claims of Funds which have been duly proved and established under  
        the Bonds shall be satisfied in full before satisfaction of any claims
of MFS or other MFS Parties, if any.                          

1 

SC 14D9
51st Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 51st
B.       If the claims of Funds which have been duly proved and established     
    under the Bonds exceed the face amount of the Bonds, the insurance
    proceeds shall be applied to those claims in the following manner:

(i)      first, the insurance proceeds shall be applied to the claim of each    
Fund up to its respective minimum fidelity bond requirement as
       determined pursuant to paragraph one above with respect to the Funds;
and                                                           

(ii)     the remaining amount of insurance proceeds then shall be applied to the
   unsatisfied claims of the Funds in proportion to their respective
        minimum fidelity bond requirements as determined pursuant to paragraph
one above with respect to the Funds.                          

C.       If after giving effect to Paragraph A there remains a portion of the   
       insurance under the Bonds available for the satisfaction of claims of
   MFS or other MFS Parties, if any, which have been duly proved and
     established under the Bonds, such remainder shall be applied as MFS
shall determine.                                              

  4. This Agreement hereby supercedes all prior or contemporaneous
agreements among the parties hereto (or any two or more of them) (which other   
agreements may include other parties) relating to the subject matter hereof.    

        5. The Agreement shall be governed by and construed in accordance with
the laws of The Commonwealth of Massachusetts.                                  

     6. Exhibit A hereto may be amended from time to time to reflect the
changes in the funds insured under the Bonds.                                   

        7. A copy of the Declaration of Trust of each Fund is on file with the
Secretary of State of The Commonwealth of Massachusetts. Each party hereto      
acknowledges that the obligations of or arising out of this Agreement are not   
binding upon any of the Fund's Trustees, officers, employees, agents or         
shareholders individually, but are binding solely upon the assets and property  
of the Fund. If this Agreement is executed by the Fund on behalf of one or more 
series of the Fund, each party hereto further acknowledges that the assets and  
liabilities of each series are separate and distinct and that the obligations of
or arising out of this Agreement concerning a series are binding solely upon the
assets or property of such series and not upon the assets or property of any    
other series.                                                                   

  8. This Agreement may be amended or modified only with the prior written
consent of the parties hereto.                                                  

           IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered in their names and on their behalf by the
undersigned officers thereunto duly authorized, all as of the day and year first
above written.                                                                  

MASSACHUSETTS FINANCIAL SERVICES COMPANY                                        
MFS INSTITUTIONAL ADVISORS, INC.                                                
MFS INTERNATIONAL LTD.                                                          
By: /s/ Robert T. Burns                                                         
------------------------                                                        
Robert T. Burns                                                 
Secretary                                                       

2 

SC 14D9
52nd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 52nd
MFS HERITAGE TRUST COMPANY                                                      

By: /s/ Robert T. Burns                                                         
---------------------                                                     
Robert T. Burns                                                 
Clerk                                                           

MFS FUND DISTRIBUTORS, INC.                                                     
MFS RETIREMENT SERVICES, INC.                                                   
MFS SERVICE CENTER, INC.                                                        
MFS INSTITUTIONAL ADVISORS (AUSTRALIA) LTD.                                     

By: /s/ Robert T. Burns                                                         
------------------------                                                  
Robert T. Burns                                                 
Secretary                                                       

On Behalf of the Funds Listed From Time to Time                                 
On Exhibit A Hereto:                                                            

By:  /s/ James R. Bordewich, Jr.                                                
-------------------------------                                           
James R. Bordewick, Jr.                                       
Assistant Secretary or Assistant Clerk                        

3 

SC 14D9
53rd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 53rd
                                                   FIDELITY BOND CLAIM AGREEMENT
                                                                       EXHIBIT A
                                                         As of February 27, 2007

MFS SERIES TRUST I                                                              
MFS Cash Reserve Fund                                                       
MFS Core Growth Fund                                                        
MFS Core Equity Fund                                                        
MFS New Discovery Fund                                                      
MFS Research International Fund                                             
MFS Strategic Growth Fund                                                   
MFS Technology Fund                                                         
MFS Value Fund                                                              

MFS SERIES TRUST II                                                             
MFS Emerging Growth Fund                                                    

MFS SERIES TRUST III                                                            
MFS High Income Fund                                                        
MFS High Yield Opportunities Fund                                           
MFS Municipal High Income Fund                                              

MFS SERIES TRUST IV                                                             
MFS Government Money Market Fund                                            
MFS Mid Cap Growth Fund                                                     
MFS Money Market Fund                                                       
MFS Municipal Bond Fund                                                     

MFS SERIES TRUST V                                                              
MFS Research Fund                                                           
MFS Total Return Fund                                                       
MFS International New Discovery Fund                                        

MFS SERIES TRUST VI                                                             
MFS Global Equity Fund                                                      
MFS Global Total Return Fund                                                
MFS Utilities Fund                                                          

MFS SERIES TRUST VII                                                            
MFS Capital Opportunities Fund                                              

MFS SERIES TRUST VIII                                                           
MFS Global Growth Fund                                                      
MFS Strategic Income Fund                                                   

MFS SERIES TRUST IX                                                             
MFS Bond Fund                                                               
MFS Inflation-Adjusted Bond Fund                                            
MFS Intermediate Investment Grade Bond Fund                                 
MFS Limited Maturity Fund                                                   
MFS Municipal Limited Maturity Fund                                         

4 

SC 14D9
54th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 54th
MFS Research Bond Fund                                                      
MFS Research Bond Fund J                                                    

MFS SERIES TRUST X                                                              
MFS Aggressive Growth Allocation Fund                                       
MFS Conservative Allocation Fund                                            
MFS Emerging Markets Debt Fund                                              
MFS Emerging Markets Equity Fund                                            
MFS Floating Rate High Income Fund                                          
MFS Growth Allocation Fund                                                  
MFS International Diversification Fund                                      
MFS International Growth Fund                                               
MFS International Value Trust                                               
MFS Moderate Allocation Fund                                                
MFS New Endeavor Fund                                                       
MFS Strategic Value Fund                                                    

MFS SERIES TRUST XI                                                             
MFS Mid Cap Value Fund                                                      
MFS Union Standard Equity Fund                                              

MFS SERIES TRUST XII                                                            
MFS Lifetime Retirement Income Fund                                         
MFS Lifetime 2010 Fund                                                      
MFS Lifetime 2020 Fund                                                      
MFS Lifetime 2030 Fund                                                      
MFS Lifetime 2040 Fund                                                      
MFS Sector Rotational Fund                                                  

MFS SERIES TRUST XIII                                                           
MFS Diversified Income Fund                                                     
MFS Government Securities Fund                                                  

MFS SERIES TRUST XIV                                                            
MFS Institutional Money Market Portfolio                                        
MFS Institutional Municipal Money Market Portfolio                              

STAND-ALONE FUNDS                                                               
MFS Growth Opportunities Fund                                               
Massachusetts Investors Growth Stock Fund                                   
MFS Government Limited Maturity Fund                                        
Massachusetts Investors Trust                                               

CLOSED-END FUNDS                                                                
MFS Charter Income Trust                                                    
MFS Government Markets Income Trust                                         
MFS Intermediate Income Trust                                               
MFS Multimarket Income Trust                                                
MFS Municipal Income Trust                                                  
MFS Special Value Trust                                                     

MFS MUNICIPAL SERIES TRUST                                                      

5 

SC 14D9
55th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 55th
MFS Alabama Municipal Bond Fund                                             
MFS Arkansas Municipal Bond Fund                                            
MFS California Municipal Bond Fund                                          
MFS Florida Municipal Bond Fund                                             
MFS Georgia Municipal Bond Fund                                             
MFS Maryland Municipal Bond Fund                                            
MFS Massachusetts Municipal Bond Fund                                       
MFS Mississippi Municipal Bond Fund                                         
MFS New York Municipal Bond Fund                                            
MFS North Carolina Municipal Bond Fund                                      
MFS Pennsylvania Municipal Bond Fund                                        
MFS South Carolina Municipal Bond Fund                                      
MFS Tennessee Municipal Bond Fund                                           
MFS Virginia Municipal Bond Fund                                            
MFS West Virginia Municipal Bond Fund                                       
MFS Municipal Income Fund                                                   

MFS INSTITUTIONAL TRUST                                                         
MFS Institutional International Equity Fund                                 
MFS Institutional International Research Equity Fund                        
MFS Institutional Large Cap Value Fund                                      

MFS VARIABLE INSURANCE TRUST                                                    
MFS Capital Opportunities Series                                            
MFS Emerging Growth Series                                                  
MFS Global Equity Series                                                    
MFS High Income Series                                                      
MFS Investors Growth Stock Series                                           
MFS Investors Trust Series                                                  
MFS Mid Cap Growth Series                                                   
MFS Money Market Series                                                     
MFS New Discovery Series                                                    
MFS Research Bond Series                                                    
MFS Research International Series                                           
MFS Research Series                                                         
MFS Strategic Income Series                                                 
MFS Total Return Series                                                     
MFS Utilities Series                                                        
MFS Value Series                                                            

6 

SC 14D9
56th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 56th
SUN LIFE PRODUCTS                                                               
MFS/Sun Life Series Trust:                                                      
Bond Series                                                                 
Capital Appreciation Series                                                 
Capital Opportunities Series                                                
Core Equity Series                                                          
Emerging Growth Series                                                      
Emerging Markets Equity Series                                              
Global Governments Series                                                   
Global Growth Series                                                        
Global Total Return Series                                                  
Government Securities Series                                                
High Yield Series                                                           
International Growth Series                                                 
International Value Series                                                  
Massachusetts Investors Growth Stock Series                                 
Massachusetts Investors Trust Series                                        
Mid Cap Growth Series                                                       
Mid Cap Value Series                                                        
Money Market Series                                                         
New Discovery Series                                                        
Research International Series                                               
Research Series                                                             
Strategic Growth Series                                                     
Strategic Income Series                                                     
Strategic Value Series                                                      
Technology Series                                                           
Total Return Series                                                         
Utilities Series                                                            
Value Series                                                                

Compass Variable Accounts:                                                      
-------------------------                                                       
Capital Appreciation Variable Account                                   
Government Securities Variable Account                                  
Global Governments Variable Account                                     
High Yield Variable Account                                             
Money Market Variable Account                                           
Total Return Variable Account                                           

7 

SC 14D9
57th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 57th
                                                                  Exhibit (e)(6)

 FORM OF INDEMNIFICATION AGREEMENT

         This Indemnification Agreement (this "Agreement") is made as of January
24, 2006 by and between (i) each investment company listed on Appendix A hereto,
as the same may be amended from time to time, acting on behalf of itself and    
each of its portfolio series whether existing on the date hereof or subsequently
established (the "Funds") and (ii) the trustee of the Funds whose name is set   
forth on the signature page (the "Trustee").                                    

        WHEREAS, the Trustee is a trustee of the Funds, and the Funds wish the
Trustee to continue to serve in that capacity;                                  

         WHEREAS, the declarations of trust of the Funds do not limit any rights
to indemnification that the Trustee may be entitled to by contract or otherwise 
under law; and                                                                  

       WHEREAS, to induce the Trustee to continue to provide services to the
Funds as a trustee of the Funds and to provide the Trustee with contractual     
assurance that indemnification will be available to the Trustee, the Funds      
desire to provide the Trustee with protection against personal liability and    
delineate certain procedural aspects relating to indemnification and advancement
of expenses, as more fully set forth herein.                                    

    NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual agreements set forth herein, the parties hereby agree as set forth below.

Item 11.  Definitions.  For purposes of this Agreement, the following terms     
shall have the following meanings:                                              

       "Disabling Conduct" shall mean the Trustee's willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the     
conduct of his or her office.                                                   

       "Expenses" shall include without limitation all judgments, penalties,
fines, amounts paid in settlement or compromise, prohibited transaction excise  
taxes, liabilities, losses, interest, expenses of investigation, attorneys'     
fees, retainers, court costs, transcript costs, fees of experts and witnesses,  
expenses of preparing for and attending depositions and other proceedings,      
travel expenses, duplicating costs, printing and binding costs, telephone       
charges, postage, delivery service fees and all other costs, disbursements or   
expenses of the type customarily incurred in connection with prosecuting,       
defending, preparing to prosecute or defend, investigating or acting as a       
witness in a Proceeding.                                                        

        "Final Adjudication" shall mean a final adjudication by court order or
judgment of the court or other body before which a matter is pending, from which
no further right of appeal or review exists.                                    

        "Non-Party Trustee" shall mean a trustee of a Fund who is not (i) an
"interested person" of such Fund as defined in Section 2(a)(19) of the          
Investment Company Act of 1940, as amended, (ii) a party to the Proceeding with 
respect to which indemnification or advances are sought or (iii) a              

1 

SC 14D9
58th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 58th
party to any other  Proceeding based on the same or similar grounds that is then
or has been pending.                                                            

        The term "Proceeding" shall include without limitation any threatened,
pending or completed claim, demand, discovery request, request for testimony or 
information, action, suit, arbitration, alternative dispute mechanism,          
investigation, hearing or other proceeding, including any appeal from any of the
foregoing, whether civil, criminal, administrative or investigative and, except 
as otherwise provided herein, shall also include any proceeding brought by or in
the right of any Fund and any proceeding brought by a Trustee against any Fund. 

      The Trustee's "service to a relevant Fund" or "service to such Fund"
shall include without limitation the Trustee's service as a trustee or advisory 
trustee of the Fund and his or her service at the request of the Fund as a      
trustee, director, officer, employee, agent or representative of another        
corporation, partnership, joint venture, trust, employee benefit plan or other  
enterprise.                                                                     

     "Special Counsel" shall mean a law firm, or a member of a law firm,
that is experienced in matters of investment company law and neither at the time
of designation is, nor in the five years immediately preceding such designation 
was, retained to represent (i) the relevant Fund or the Trustee (except that a  
majority of the Non-Party Trustees may determine, in their sole discretion, that
any prior representation of the Fund or Trustee shall not disqualify such law   
firm or a member of a law firm from representation if the prior representation  
is not related to the issue in dispute) or (ii) any other party to the          
Proceeding (or any party reasonably expected to become a party to the           
Proceeding) giving rise to a claim for indemnification or advancements          
hereunder. Notwithstanding the foregoing, however, the term "Special Counsel"   
shall not include any person who, under the applicable standards of professional
conduct then prevailing, would have a conflict of interest in representing      
either the relevant Fund or the Trustee in an action to determine the Trustee's 
rights pursuant to this Agreement, regardless of when the Trustee's act or      
failure to act occurred.                                                        

Item 12. Indemnification. Each of the Funds severally shall indemnify and hold  
harmless the Trustee against any and all Expenses actually incurred or paid by  
the Trustee in any Proceeding in connection with the Trustee's service to the   
relevant Fund, subject to the provisions of the following sentence and the      
provisions of Section 3 and paragraph (h) of Section 6 of this Agreement,       
provided that in any Proceeding initiated by the Trustee, other than one        
instituted pursuant to Section 6(d) or 6(f), the initiation of the Proceeding by
the Trustee was approved in advance by a majority of the Non-Party Trustees. The
Trustee shall be indemnified pursuant to this Section 2 against any and all     
Expenses unless (i) the Trustee is subject to such Expenses by reason of the    
Trustee's not having acted in good faith in the reasonable belief that his or   
her action was in the best interests of the Fund or (ii) the Trustee is liable  
to the Fund or its shareholders by reason of the Trustee's Disabling Conduct,   
and with respect to each of (i) and (ii), there has been a Final Adjudication in
an adjudication on the merits in the relevant Proceeding that the Trustee's     
conduct fell within (i) or (ii).                                                

Item 13. Advancement of Expenses. Expenses, including counsel fees incurred by  
the Trustee (but excluding amounts paid in satisfaction of judgments, in        
compromise or as fines or penalties), shall be paid from time to time by the    
Fund in advance of Final Adjudication of a Proceeding in connection with the    
Trustee's service to a Fund, upon receipt by the Fund of an                     

2 

SC 14D9
59th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 59th
undertaking  by or on behalf of the Trustee to repay amounts so paid to the Fund
if  it  is   ultimately   determined   that  the  Trustee  is  not  entitled  to
indemnification  of such Expenses under this Agreement,  provided,  that (a) the
Trustee shall provide security for his or her undertaking, (b) the Fund shall be
insured against losses arising by reason of the Trustee's failure to fulfill his
or her undertaking  (it being  understood that the Fund shall not be required to
obtain such insurance),  or (c) a majority of the Non-Party  Trustees  (provided
that a majority of such Non-Party Trustees then in office act on the matter), or
Special  Counsel  in a written  opinion  shall  determine,  based on a review of
readily  available  facts  (but not a full  trial-type  inquiry),  that there is
reason to believe the Trustee ultimately will be entitled to indemnification.   

Item 14. Presumptions. For purposes of the determination or opinion referred to 
in clause (c) of Section 3 or clauses (y)(i) or (y)(ii) of subsection (h) of    
Section 6 of this Agreement, the Non-Party Trustees or Special Counsel, as the  
case may be, shall be entitled to rely upon a rebuttable presumption that the   
Trustee has not engaged in Disabling Conduct.                                   

Item 15. Witness Expenses. To the extent the Trustee is, by reason of the       
Trustee's service to the relevant Fund, a witness for any reason in any         
Proceeding to which such Trustee is not a party, such Trustee shall be          
indemnified against any and all Expenses actually incurred by or on behalf of   
such Trustee in connection therewith.                                           

Item 16. Procedure for Determination of Entitlement to Indemnification and      
Advancements. A request by the Trustee for indemnification or advancement of    
Expenses shall be made in writing and shall be accompanied by such relevant     
documentation and information as is reasonably available to the Trustee. The    
Secretary of the relevant Fund shall promptly advise the trustees of such Fund  
of such request.                                                                

Methods of Determination. Upon the Trustee's request for      
indemnification or advancement of Expenses, a determination with respect to the 
Trustee's entitlement thereto shall be made in a manner consistent with the     
terms of this Agreement, unless (in the case of advancements) the relevant Fund 
and the Trustee shall have received written confirmation in reasonably          
acceptable form that such Fund is insured against losses arising by reason of   
any lawful advancements and that the insurer will pay the Expenses of the       
Trustee in a reasonably prompt manner, in which case no determination shall be  
required. The Trustee shall cooperate with the person or persons making such    
determination, including without limitation providing to such person or persons 
upon reasonable advance request any documentation or information that is not    
privileged or otherwise protected from disclosure and is reasonably available to
the Trustee and reasonably necessary to such determination. Any failure by the  
Trustee to cooperate with the person or persons making such determination shall 
extend as necessary and appropriate the period or periods described in paragraph
(c) of this Section 6 regarding determinations deemed to have been made. Any    
Expenses incurred by the Trustee in so cooperating shall be borne by such Fund, 
irrespective of the determination as to the Trustee's entitlement to            
indemnification or advancement of Expenses.                                     

         Special Counsel. If the determination of entitlement to indemnification
or advancement of Expenses is to be made by Special Counsel, the Special Counsel
shall be selected by a majority of the Non-Party Trustees of the relevant Fund  
(or, if there are no Non-Party Trustees with respect to the matter in question, 
by a majority of the Trustees of the Fund who are not                           

3 

SC 14D9
60th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 60th
"interested  persons"  of the  Fund,  as  defined  in  Section  2(a)(19)  of the
Investment  Company Act of 1940, as amended (the "Independent  Trustees")),  and
such Fund shall give written  notice to the Trustee  advising the Trustee of the
identity of the Special Counsel selected.  The Trustee may, within five (5) days
after receipt of such written notice,  deliver to such Fund a written  objection
to such  selection.  Such  objection may be asserted only on the ground that the
Special Counsel so selected does not meet the  requirements set forth in Section
1 and shall set forth with  particularity  the factual basis of such  assertion.
The Non-Party  Trustees (or  Independent  Trustees,  as the case may be) of such
Fund shall  determine  the merits of the  objection  and,  in their  discretion,
either determine that the proposed Special Counsel shall, despite the objection,
act as such  hereunder or select another  Special  Counsel who shall act as such
hereunder.                                                                      

   If within fourteen (14) days after submission by the Trustee of a
written request for indemnification or advancement of Expenses no such Special  
Counsel shall have been finally selected as provided in the previous paragraph, 
then either the relevant Fund or the Trustee may petition an appropriate court  
of the Commonwealth of Massachusetts or any other court of competent            
jurisdiction for the appointment as Special Counsel of a person selected by the 
court or by such other person as the court shall designate, and the person so   
appointed shall act as Special Counsel.                                         

         The relevant Fund shall pay all reasonable fees and Expenses charged or
incurred by Special Counsel in connection with his, her or its determinations   
pursuant to this Agreement and shall pay all reasonable fees and Expenses       
incident to the procedures described in this paragraph, regardless of the manner
in which such Special Counsel was selected or appointed.                        

Failure to Make Timely  Determination.  Subject to paragraph (a) of this Section
6, if the person or persons  empowered  or  selected  to  determine  whether the
Trustee is entitled to  indemnification  or advancement of Expenses  (other than
determinations  that are made or to be made by a court) shall not have made such
determination  within thirty (30) days after receipt by the relevant Fund of the
request therefor, the requisite  determination of entitlement to indemnification
or  advancement  of Expenses  shall be deemed to have been made, and the Trustee
shall  be  entitled  to  such  indemnification  or  advancement,  absent  (i) an
intentional  misstatement  by the Trustee of a material  fact, or an intentional
omission  of a material  fact  necessary  to make the  Trustee's  statement  not
materially  misleading,  in connection with the request for  indemnification  or
advancement  of  Expenses,   (ii)  a  prohibition  of  such  indemnification  or
advancements under applicable law or the relevant Fund's declaration of trust or
by-laws,  (iii) a  requirement  under the  Investment  Company  Act of 1940,  as
amended,  for  insurance or security,  which has not been  satisfied,  or (iv) a
subsequent  Final  Adjudication  or,  in a matter  disposed  of  without a Final
Adjudication,  determination  pursuant to subsection  (h) of Section 6, that the
Trustee is not  entitled  to  indemnification  under this  Agreement;  provided,
however,  that such period may be extended for a reasonable  period of time, not
to exceed an additional  thirty (30) days,  if the person or persons  making the
determination  in good faith require such  additional time to obtain or evaluate
documentation or information  relating thereto. Any assertion under clauses (i),
(ii), or (iii) of this Section 6(c) shall be made in writing,  specify the basis
for the assertion, and be delivered to the Trustee within thirty (30) days after
receipt by the relevant Fund of the request for  indemnification  or advancement
of Expenses (or any extension of such period  provided under this Section 6(c)).
The  Trustee  shall  be  entitled  to  adjudication  of  such  assertion  in  an

4 

SC 14D9
61st Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 61st
appropriate  court of the  Commonwealth of  Massachusetts  or any other court of
competent jurisdiction.                                                         

Payment upon  Determination of Entitlement.  If a determination is made pursuant
to Section 2 or Section 3 (or is deemed to be made  pursuant to paragraph (c) of
this Section 6 and, in the case of advancement of Expenses, the other conditions
are satisfied) that the Trustee is entitled to indemnification or advancement of
Expenses,  payment of any  indemnification  amounts or advancements owing to the
Trustee shall be made within ten (10) days after such determination (and, in the
case of advancements of further Expenses,  within ten (10) days after submission
of supporting  information,  including the required  undertaking and evidence of
any required security).  If such payment is not made when due, the Trustee shall
be entitled to adjudication of the Trustee's entitlement to such indemnification
or advancements in an appropriate  court of the Commonwealth of Massachusetts or
any other court of  competent  jurisdiction.  The  Trustee  shall  commence  any
proceeding seeking adjudication within 60 days following the date on which he or
she first has the right to commence such  proceeding  pursuant to this paragraph
(d).  In  any  such  proceeding,  the  relevant  Fund  shall  be  bound  by  the
determination  that the Trustee is entitled to  indemnification or advancements,
absent (i) an intentional  misstatement by the Trustee of a material fact, or an
intentional  omission of a material fact  necessary to make his or her statement
not materially misleading, in connection with the request for indemnification or
advancements,  (ii) a prohibition of such  indemnification or advancements under
applicable law or (iii) a requirement under the Investment  Company Act of 1940,
as amended, for insurance or security, which has not been satisfied.            

Appeal of Adverse Determination.  If a determination is made that the Trustee is
not entitled to indemnification or advancements  (other than determinations that
are made by a court),  the Trustee  shall be entitled  to  adjudication  of such
matter in an appropriate court of the Commonwealth of Massachusetts or any other
court of  competent  jurisdiction.  Alternatively,  the  Trustee,  at his or her
option,  may seek an award in arbitration to be conducted by a single arbitrator
pursuant to the rules of the American Arbitration Association. The Trustee shall
commence such  proceeding or  arbitration  within 60 days  following the date on
which  the  adverse  determination  is made.  Any such  judicial  proceeding  or
arbitration shall be conducted in all respects as a de novo trial or arbitration
on the merits,  and the Trustee  shall not be prejudiced by reason of such prior
adverse determination.                                                          

Expenses of Appeal. If the Trustee seeks arbitration or a judicial  adjudication
to  determine  or enforce  his or her rights  under,  or to recover  damages for
breach  of,  the  indemnification  or  Expense  advancement  provisions  of this
Agreement,  the Trustee shall be entitled to recover from the relevant Fund, and
shall  be  indemnified  by such  Fund  against,  any and all  Expenses  actually
incurred by the Trustee in such arbitration or judicial  adjudication,  but only
if the Trustee prevails  therein.  If it shall be determined in such arbitration
or judicial  adjudication  that the Trustee is entitled to receive  part but not
all of the  indemnification  or  advancement  of Expenses  sought,  the expenses
incurred  by the  Trustee  in  connection  with  such  arbitration  or  judicial
adjudication shall be appropriately prorated.                                   

Validity of  Agreement.  In any  arbitration  or judicial  proceeding  commenced
pursuant to this Section 4, the relevant Fund shall be precluded  from asserting
that the procedures and  presumptions set forth in this Agreement are not valid,
binding and enforceable  against such                                           

5 

SC 14D9
62nd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 62nd
Fund and shall  stipulate in any such court or before any such  arbitrator  that
such Fund is bound by all the provisions of this Agreement.                     

Lack of Adjudication.  Notwithstanding any provision herein to the contrary,  as
to any matter disposed of (whether by compromise payment,  pursuant to a consent
decree or otherwise)  without a Final  Adjudication  in an  adjudication  on the
merits by a court, or by any other body before which the Proceeding was brought,
that the Trustee either (a) did not act in good faith in the  reasonable  belief
that the Trustee's action was in the best interests of the Fund or (b) is liable
to the Fund or its shareholders by reason of Disabling Conduct,  indemnification
shall be provided if there has been (x) a determination that the Trustee did not
engage in Disabling  Conduct by the court or other body approving any settlement
or  other  disposition  of  the  matter  or (y)  there  has  been  a  reasonable
determination,  based upon a review of readily  available  facts (but not a full
trial-type  inquiry),  that the  Trustee  acted in good faith in the  reasonable
belief that the  Trustee's  action was in the best  interests of the Fund and is
not liable to the Fund or its  shareholders by reason of Disabling  Conduct,  by
(i) the vote of a majority of the Non-Party  Trustees  (provided that a majority
of such  Non-Party  Trustees  then in office act on the matter) or (ii)  Special
Counsel in a written opinion.                                                   

Item 17.          General Provisions.                                           

Non-Exclusive  Rights. The provisions for indemnification of, and advancement of
Expenses  to,  the  Trustee  set  forth in this  Agreement  shall  not be deemed
exclusive  of any other  rights to which the Trustee may  otherwise be entitled,
including any other rights to be  indemnified  or have Expenses  advanced by the
relevant  Fund.  The relevant  Fund shall not be liable under this  Agreement to
make any  payment of amounts  otherwise  indemnifiable  hereunder  if and to the
extent that the Trustee has otherwise  actually  received such payment under any
insurance  policy,  contract,  agreement  or  otherwise,  if such payment is not
recoverable from the Trustee.                                                   

Continuation of Provisions.  This Agreement shall be binding upon all successors
of  each  Fund,   including   without   limitation  any  transferee  of  all  or
substantially all assets of a Fund and any successor by merger, consolidation or
operation of law and shall inure to the benefit of the Trustee's spouse,  heirs,
assigns,  devisees,  executors,  administrators and legal  representatives.  The
provisions  of this  Agreement  shall  continue with respect to a Fund until the
later of (i) ten (10) years  after the Trustee has ceased to provide any service
to such Fund and (ii) the final  termination  of all  Proceedings  in respect of
which the Trustee has asserted, is entitled to assert or has been granted rights
of  indemnification  or advancement of Expenses  hereunder and of any proceeding
commenced by the Trustee pursuant to Section 4 relating thereto. No amendment of
the  applicable  declaration  of  trust  or  by-laws  of a Fund  shall  limit or
eliminate  the  right of the  Trustee  to  indemnification  and  advancement  of
Expenses set forth in this Agreement.                                           

Selection of Counsel.  The relevant Fund shall be entitled to assume the defense
of any Proceeding for which the Trustee seeks  indemnification or advancement of
Expenses under this Agreement.  However,  counsel  selected by the Trustee shall
conduct the defense of the Trustee to the extent  reasonably  determined by such
counsel to be  necessary  to  protect  the  interests  of the  Trustee,  and the
relevant  Fund shall  indemnify  the Trustee  therefor  to the extent  otherwise
permitted under this Agreement,  if (i) the Trustee  reasonably  determines that
there may be a conflict in the  Proceeding  between the positions of the Trustee
and the positions of such Fund or                                               

6 

SC 14D9
63rd Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 63rd
the other parties to the  Proceeding  that are  indemnified by such Fund and not
represented by separate counsel, or the Trustee otherwise  reasonably  concludes
that representation of both the Trustee, such Fund and such other parties by the
same  counsel  would not be  appropriate,  or (2) the  Proceeding  involves  the
Trustee  but  neither  the  relevant  Fund  nor  any  such  other  party  who is
indemnified by the Fund and the Trustee  reasonably  withholds  consent to being
represented  by counsel  selected by such Fund.  If the relevant  Fund shall not
have elected to assume the defense of any such Proceeding for the Trustee within
thirty (30) days after receiving  written notice thereof from the Trustee,  such
Fund shall be deemed to have waived any right it might  otherwise have to assume
such defense. If the relevant Fund does not assume or conduct the defense of any
Proceeding,  the  Trustee  shall  not  consent  to a  settlement  or  any  other
disposition not involving a Final Adjudication without the prior written consent
of the Fund.                                                                    

D&O Insurance.  To the extent any Fund maintains an insurance policy or policies
providing  liability  insurance  to its  trustees  or its  trustees  who are not
"interested  persons"  of  the  Fund  as  defined  in  Section  2(a)(19)  of the
Investment Company Act of 1940, as amended, the Trustee shall be covered by such
policy or  policies  at all times  when  serving  as a member of the  Board,  in
accordance  with its or their  terms,  to the  maximum  extent  of the  coverage
available for any similarly  situated  trustee of such Fund. For a period of six
(6) years  after the Trustee has ceased to serve as a member of the Board and to
the extent  insurance as provided in the previous  sentence does not continue to
cover the Trustee even though he is no longer  serving as a member of the Board,
such Fund  shall  purchase  and  maintain  in  effect,  through  "tail" or other
appropriate coverage, one or more policies of insurance on behalf of the Trustee
to the maximum extent of the coverage  provided to then serving trustees of such
Fund,  unless the  purchase of such  insurance  by the Fund is not  permitted by
applicable law,  including for these purposes any fiduciary duties applicable to
the persons then  constituting  the trustees of such Fund, such insurance is not
generally available,  or in the reasonable business judgment of the persons then
constituting  the  Board,  the  premium  for  such  insurance  is  substantially
disproportionate to the amount of coverage afforded.                            

Subrogation. In the event of any payment by any Fund pursuant to this Agreement,
such Fund shall be subrogated to the extent of such payment to all of the rights
of recovery of the Trustee,  who shall, upon reasonable  written request by such
Fund and at such Fund's  expense,  execute all such  documents and take all such
reasonable  actions as are necessary to enable such Fund to enforce such rights.
Nothing in this Agreement shall be deemed to diminish or otherwise  restrict the
right of such Fund or the Trustee to proceed or collect  against any insurers or
to give such insurers any rights against such Fund under or with respect to this
Agreement,  including  without  limitation  any  right to be  subrogated  to the
Trustee's rights hereunder, unless otherwise expressly agreed to by such Fund in
writing,  and the obligation of such insurers to such Fund and the Trustee shall
not be  deemed  to be  reduced  or  impaired  in any  respect  by  virtue of the
provisions of this Agreement.                                                   

Notice of  Proceedings.  The Trustee shall promptly  notify the relevant Fund in
writing  upon being  served with any  summons,  citation,  subpoena,  complaint,
indictment, information or other document relating to any Proceeding that may be
subject  to   indemnification  or  advancement  of  Expenses  pursuant  to  this
Agreement,  but no delay in  providing  such  notice  shall in any way  limit or
affect  the  Trustee's  rights or the  relevant  Fund's  obligations  under this
Agreement.                                                                      

7 

SC 14D9
64th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 64th
Notices.  All notices,  requests,  demands and other  communications  to a party
pursuant to this Agreement  shall be in writing and shall be deemed to have been
duly given when delivered  personally  (with a written receipt by the addressee)
or two (2) days after being sent (i) by certified or  registered  mail,  postage
prepaid,  return receipt  requested or (ii) by nationally  recognized  overnight
courier  service to 500 Boylston  Street,  Boston,  MA 02116 (if  addressed to a
Fund),  the  address  specified  on the  signature  page of this  Agreement  (if
addressed  to the Trustee) or such other  address as may have been  furnished by
such party by notice in accordance with this paragraph.                         

Severability.  If any provision of this  Agreement  shall be held to be invalid,
illegal or unenforceable,  in whole or in part, for any reason  whatsoever,  (i)
the validity,  legality and  enforceability of the remaining  provisions of this
Agreement  (including  without  limitation  each  portion of any Section of this
Agreement  containing  any  provision  that is not  itself  invalid,  illegal or
unenforceable)  shall not in any way be affected or impaired thereby and (ii) to
the fullest extent possible, the remaining provisions of this Agreement shall be
construed so as to give effect to the intent  manifested by the  provision  held
invalid, illegal or unenforceable.                                              

Modification  and  Waiver.  This  Agreement  supersedes  any  existing  or prior
agreement  between the relevant  Fund and the Trustee  pertaining to the subject
matter of  indemnification,  advancement of Expenses and  insurance,  other than
such  Fund's  declaration  of  trust,  by-laws  and the  terms of any  liability
insurance policies, which shall not be modified or amended by this Agreement. No
supplement,  modification or amendment of this Agreement shall be binding unless
executed  in writing by both  parties or their  respective  successors  or legal
representatives;  provided,  however,  that any  supplements,  modifications  or
amendments to the  declaration  of trust,  by-laws or the terms of the liability
insurance  policy or  policies  of any Fund  shall  not be deemed to  constitute
supplements, modifications or amendments to this Agreement. Any waiver by either
party of any  breach  by the  other  party of any  provision  contained  in this
Agreement  to be  performed  by the other party must be in writing and signed by
the waiving party or such party's successor or legal representative, and no such
waiver  shall be deemed a waiver of similar or other  provisions  at the same or
any prior or subsequent time.                                                   

Joinder of Funds.  In the event that  additional  funds are created from time to
time,  Appendix  A  listing  each Fund  that is party to this  Agreement  may be
amended to add the  additional  funds by each  applicable  fund's  execution and
delivery  to the  Trustee of an amended  Appendix A. As of the date set forth on
the amended  Appendix A, the additional fund shall thereafter be deemed a "Fund"
for all purposes of this Agreement.                                             

Headings.  The headings of the Sections of this  Agreement  are for  convenience
only and shall not be deemed to control or affect the meaning or construction of
any provision of this Agreement.                                                

Counterparts.  This Agreement may be executed in one or more counterparts,  each
of which  shall be an  original,  and all of which  when  taken  together  shall
constitute one document.                                                        

Applicable  Law. This Agreement  shall be governed by and construed and enforced
in  accordance  with  the  laws of the  Commonwealth  of  Massachusetts  without
reference to principles of conflict of laws.                                    

8 

SC 14D9
65th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 65th
WAIVER  OF RIGHT  TO JURY  TRIAL.  BY  EXECUTING  THIS  AGREEMENT,  THE  PARTIES
KNOWINGLY  AND  WILLINGLY  WAIVE ANY RIGHT THEY HAVE UNDER  APPLICABLE  LAW TO A
TRIAL  BY JURY IN ANY  DISPUTE  ARISING  OUT OF OR IN ANY  WAY  RELATED  TO THIS
AGREEMENT OR THE ISSUES RAISED BY THAT DISPUTE.                                 

Miscellaneous. Copies of the declarations of trust of the Funds are on file with
the Secretary of the  Commonwealth  of the  Commonwealth of  Massachusetts.  The
obligations  of or arising out of this Agreement are not binding upon any of the
Trusts' trustees, officers, employees, agents or shareholders individually,  but
are binding solely upon the assets and property of the Funds in accordance  with
their proportionate  interests hereunder.  The assets and liabilities of each of
the Funds are separate and distinct,  and the  obligations  of or arising out of
this instrument are binding solely upon the assets or property of the respective
Funds.                                                                          

[The remainder of this page is intentionally left blank]

9 

SC 14D9
66th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 66th
         IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed in its name and on its behalf on the date set forth above.             

Each Investment Company listed on           TRUSTEE                             
Appendix A Attached  Hereto, on Behalf                                          
of itself and each of its                                                       
Portfolio Series                                                                

____________________________                ____________________________________
Name:   Maria F. Dwyer                      Name:                               
Title:  President                                                               
                            Address for Notices:

10

SC 14D9
67th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 67th
APPENDIX A

TO

 INDEMNIFICATION AGREEMENT

 BETWEEN

[TRUSTEE] AND EACH OF THE INVESTMENT COMPANIES

DATED AS OF JANUARY 24, 2006

MASSACHUSETTS INVESTORS GROWTH STOCK FUND, a Massachusetts business trust       

MASSACHUSETTS INVESTORS TRUST, a Massachusetts business trust                   

MFS CHARTER INCOME TRUST, a Massachusetts business trust                        

MFS GOVERNMENT LIMITED MATURITY FUND, a Massachusetts business trust            

MFS GOVERNMENT MARKETS INCOME TRUST, a Massachusetts business trust             

MFS GOVERNMENT SECURITIES FUND, a Massachusetts business trust                  

MFS GROWTH OPPORTUNITIES FUND, a Massachusetts business trust                   

MFS INTERMEDIATE INCOME TRUST, a Massachusetts business trust                   

MFS MULTIMARKET INCOME TRUST, a Massachusetts business trust                    

MFS MUNICIPAL INCOME TRUST, a Massachusetts business trust                      

MFS SPECIAL VALUE TRUST, a Massachusetts business trust                         

MFS SERIES TRUST I, a Massachusetts business trust, on behalf of each of:       
MFS Cash Reserve Fund                                         
MFS Core Equity Fund                                          
MFS Core Growth Fund                                          
MFS New Discovery Fund                                        
MFS Research International Fund                               
MFS Strategic Growth Fund                                     
MFS Technology Fund                                           
MFS Value Fund                                                

1 

SC 14D9
68th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 68th
MFS SERIES TRUST II, a Massachusetts business trust, on behalf of each of:      
MFS Emerging Growth Fund                                      

MFS SERIES TRUST III, a Massachusetts business trust, on behalf of each of:     
MFS High Income Fund                                          
MFS High Yield Opportunities Fund                             
MFS Municipal High Income Fund                                

MFS SERIES TRUST IV, a Massachusetts business trust, on behalf of each of:      
MFS Government Money Market Fund                              
MFS Mid Cap Growth Fund                                       
MFS Money Market Fund                                         
MFS Municipal Bond Fund                                       

MFS SERIES TRUST V, a Massachusetts business trust, on behalf of each of:       
MFS International New Discovery Fund                          
MFS Research Fund                                             
MFS Total Return Fund                                         

MFS SERIES TRUST VI, a Massachusetts business trust, on behalf of each of:      
MFS Global Equity Fund                                        
MFS Global Total Return Fund                                  
MFS Utilities Fund                                            

MFS SERIES TRUST VII, a Massachusetts business trust, on behalf of:             
MFS Capital Opportunities Fund                                

MFS SERIES TRUST VIII, a Massachusetts business trust, on behalf of each of:    
MFS Global Growth Fund                                        
MFS Strategic Income Fund                                     

MFS SERIES TRUST IX, a Massachusetts business trust, on behalf of each of:      
MFS Bond Fund                                                 
MFS Inflation-Adjusted Bond Fund                              
MFS Intermediate Investment Grade Bond Fund                   
MFS Limited Maturity Fund                                     
MFS Municipal Limited Maturity Fund                           
MFS Research Bond Fund                                        
MFS Research Bond Fund J                                      

MFS SERIES TRUST X, a Massachusetts business trust, on behalf of each of:       
MFS Aggressive Growth Allocation Fund                         
MFS Conservative Allocation Fund                              
MFS Emerging Markets Debt Fund                                
MFS Emerging Markets Equity Fund                              
MFS Floating Rate High Income Fund                            

2 

SC 14D9
69th Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 69th
MFS Growth Allocation Fund                                    
MFS International Diversification Fund                        
MFS International Growth Fund                                 
MFS International Value Fund                                  
MFS Moderate Allocation Fund                                  
MFS New Endeavor Fund                                         
MFS Strategic Value Fund                                      

MFS SERIES TRUST XI, a Massachusetts business trust, on behalf of each of:      
MFS Mid Cap Value Fund                                        
MFS Union Standard Equity Fund                                

MFS SERIES TRUST XII, a Massachusetts business trust, on behalf of each of      
MFS Lifetime Retirement Income Fund                           
MFS Lifetime 2010 Fund                                        
MFS Lifetime 2020 Fund                                        
MFS Lifetime 2030 Fund                                        
MFS Lifetime 2040 Fund                                        

MFS MUNICIPAL SERIES TRUST, a Massachusetts business trust, on behalf of        
each of:                                                      
MFS Alabama Municipal Bond Fund                               
MFS Arkansas Municipal Bond Fund                              
MFS California Municipal Bond Fund                            
MFS Florida Municipal Bond Fund                               
MFS Georgia Municipal Bond Fund                               
MFS Maryland Municipal Bond Fund                              
MFS Massachusetts Municipal Bond Fund                         
MFS Mississippi Municipal Bond Fund                           
MFS Municipal Income Fund                                     
MFS New York Municipal Bond Fund                              
MFS North Carolina Municipal Bond Fund                        
MFS Pennsylvania Municipal Bond Fund                          
MFS South Carolina Municipal Bond Fund                        
MFS Tennessee Municipal Bond Fund                             
MFS Virginia Municipal Bond Fund                              
MFS West Virginia Municipal Bond Fund                         

MFS VARIABLE INSURANCE TRUST, a Massachusetts business trust, on behalf of      
each of:                                                      
MFS Capital Opportunities Series                              
MFS Emerging Growth Series                                    
MFS Global Equity Series                                      
MFS High Income Series                                        
MFS Investors Growth Stock Series                             
MFS Investors Trust Series                                    
MFS Mid Cap Growth Series                                     
MFS Money Market Series                                       

3 

SC 14D9
Last Page of 70
TOC
1st
Previous
Next
↓Bottom
Just 70th
MFS New Discovery Series                                      
MFS Research Bond Series                                      
MFS Research International Series                             
MFS Research Series                                           
MFS Strategic Income Series                                   
MFS Total Return Series                                       
MFS Utilities Series                                          
MFS Value Series                                              

MFS INSTITUTIONAL TRUST, a Massachusetts business trust, on behalf of each of:  
MFS Institutional International Equity Fund                   
MFS Institutional International Research Equity Fund          
MFS Institutional Large Cap Growth Fund                       
MFS Institutional Large Cap Value Fund                        

[The remainder of this page is intentionally left blank]

4 

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘SC 14D9’ Filing		Date		First		Last			Other Filings
		12/31/07		48
		11/1/07		6		12			DEF 14A,  PRE 14A
		9/28/07		6		12			SC TO-T/A
Filed on:		9/25/07		4		11
		9/24/07		4
		9/19/07		4
		9/14/07		2		15			DEF 14A
		9/12/07		2					PREC14A,  SC TO-T
		9/11/07		2		11			PREC14A,  SC 13D/A,  SC TO-T
		9/4/07		2		15
		8/1/07		3		48			N-CSRS
		6/30/07		14					N-PX
		6/29/07		33
		6/22/07		33
		5/1/07		33					SC 13D
		2/27/07		33		53
		1/1/07		3		29
		12/31/06		16
		12/18/06		25
		11/30/06		16					N-CSR,  NSAR-B
		8/1/06		3		33
		2/22/06		16
		1/24/06		4		67
		1/1/06		16					3
		6/12/02		9		50
		1/1/02		3		17
		11/1/93		9		50
									List all Filings