MFS Group Announces Breach of Loan Facility to Customers

Dear Investor

I write to you on behalf of MFS Investment Management Limited (‘MFSIM’), as Responsible Entity of the MFS Premium Income Fund (‘the Fund’) to provide an update on the recent events and the MFSIM Board’s strategy and proposals for the management of the Fund subsequent to our last letter.MFSIM understands the significance of these decisions and the impact on investors. Given current market conditions and the position of the Fund, MFSIM, in the interests of all unit holders, has sought to preserve the capital value of the Fund.The MFSIM Board and its advisors are now focused on exploring initiatives to improve liquidity and allow the payment of income to unit holders and expect significant progress to be made before the end of the financial year 2008. Below we set out the key issues facing the Fund at this time. We will continue to update unit holders on developments with the Fund on a regular basis.