As filed with the Securities and Exchange Commission
on October 30, 1997
Registration No. 2-57167
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-14
REGISTRATION STATEMENT
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UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. [ ]
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Fidelity School Street Trust
(Exact Name of Registrant as Specified in Charter)
82 Devonshire St., Boston, MA 02109
(Address Of Principal Executive Offices)
Registrant's Telephone Number (617) 563-7000
Arthur S. Loring, Secretary
82 Devonshire Street
Boston, MA 02109
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering: As soon as practicable
after the Registration Statement becomes effective under the
Securities Act of 1933.
The Registrant has registered an indefinite amount of securities under
the Securities Act of 1933 pursuant to Section 24(f) under the
Investment Company Act of 1940; accordingly, no fee is payable
herewith because of reliance upon Rule 24f-2. A Rule 24f-2 Notice for
the Registrant's most recent fiscal year ended December 31, 1996 was
filed with the Commission on February 27, 1997. Pursuant to Rule 429,
this Registration Statement relates to shares previously registered on
Form N-1A.
It is proposed that this filing will become effective on November 28,
1997, pursuant to Rule 488.
FIDELITY LIMITED TERM MUNICIPAL INCOME FUND
CONTENTS OF REGISTRATION STATEMENT
This Registration Statement contains the following papers and
documents:
Facing Page
Contents of Registration Statement
Cross Reference Sheet
Solicitation Letter to Shareholders
Form of Proxy Card
Notice of Special Meeting
Part A - Proxy Statement and Prospectus
Part B - Statement of Additional Information
Part C - Other Information
Signature Page
Exhibits
FIDELITY SCHOOL STREET TRUST:
FIDELITY LIMITED TERM MUNICIPAL INCOME FUND
FORM N-14 CROSS REFERENCE SHEET
PART A
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Form N-14 Item Number and Caption Prospectus/Proxy Statement Caption
1. Beginning of Registration Statement and Out- Cover Page
side Front Cover Page of Prospectus
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2. Beginning and Outside Back Cover Page of Pro- Table of Contents
spectus
3. Fee Table, Synopsis Information and Risk Factors Synopsis; Comparison of Other Policies of the Funds;
Comparison of Principal Risk Factors; The Proposed
Transaction
4. Information About the Transactions Synopsis; The Proposed Transaction; Prospectus of
Fidelity Limited Term Municipal Income Fund dated
February 28, 1997 and supplemented August 29,
1997
5. Information About the Registrant Synopsis; Comparison of Other Policies of the Funds;
Comparison of Principal Risk Factors; Miscellaneous;
Additional Information About Fidelity Limited Term
Municipal Income Fund; Prospectus of Fidelity
Limited Term Municipal Income Fund dated February
28, 1997 and supplemented August 29, 1997;
Attachment I.
6. Information About the Company Being Acquired Cover Page; Synopsis; Comparison of Other Policies
of the Funds; Comparison of Principal Risk Factors;
Miscellaneous; Prospectus of Spartan Intermediate
Municipal Income Fund dated October 21, 1997
7. Voting Information Voting Information
8. Interest of Certain Persons and Experts Not applicable
9. Additional Information Required for Reoffering Not applicable
by Persons Deemed to be Underwriters
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PART B
Item Number and Caption Statement of Additional Information Caption
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10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. Additional Information About the Registrant Prospectus and Statement of Additional
Information of Fidelity Limited Term
Municipal Income Fund dated February 28,
1997, and prospectus supplement dated
August 29, 1997
13. Additional Information About the Company Be- Not applicable
ing Acquired
14. Financial Statements Financial Statements included in the Annual
Reports of Spartan Intermediate Municipal
Income Fund for the Fiscal Years Ended
August 31, 1996 and 1997; Financial
Statements included in the Annual Report of
Fidelity Limited Term Municipal Income
Fund for the Fiscal Year Ended December 31,
1996.
Financial Statements included in the
Semiannual Report of Spartan Intermediate
Municipal Income Fund for the Fiscal Period
Ended February 28, 1997; Financial
Statements included in the Semiannual Report
of Fidelity Limited Term Municipal Income
Fund for the Fiscal Period Ended June 30,
1997.
Pro-Forma Financial Statements for the
12-month period ended June 30, 1997.
Part C Information required to be included in Part C
is set forth under the appropriate item so
numbered in Part C of this Registration
Statement.
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IMPORTANT
PROXY MATERIALS
PLEASE CAST YOUR VOTE NOW!
Dear Shareholder:
I am writing to ask you for your vote on an important proposal to
merge Spartan Intermediate Municipal Income Fund (SPARTAN
INTERMEDIATE) into Fidelity Limited Term Municipal Income Fund
(FIDELITY LIMITED TERM). A shareholder meeting is scheduled for
February 18, 1998. Votes received in time to be counted at the
meeting will decide whether the merger takes place. This package
contains information about the proposal and includes all the materials
you will need to vote by mail.
The fund's Board of Trustees has reviewed the proposed merger and has
recommended that the proposed merger be presented to shareholders.
The Trustees, most of whom are not affiliated with Fidelity, are
responsible for protecting your interests as a shareholder. The
Trustees have determined that the proposed merger is in shareholders'
best interests. However, the final decision is up to you.
The proposed merger would give shareholders of Spartan Intermediate
the opportunity to participate in a larger fund with similar
investment policies. The combined fund would also have lower expenses
guaranteed through December 31, 1999. We have attached a Q&A to
assist you in understanding the proposal. The enclosed proxy statement
includes a detailed description of the proposed merger.
Please read the enclosed materials and promptly cast your vote on the
proxy card. You are entitled to one vote for each dollar of net asset
value you own of a fund on the record date (December 22, 1997). Your
vote is extremely important, no matter how large or small your
holdings may be.
VOTING BY MAIL IS QUICK AND EASY. EVERYTHING YOU NEED IS ENCLOSED. To
cast your vote, simply complete the proxy card enclosed in this
package. Be sure to sign the card before mailing it in the
postage-paid envelope provided.
If you have any questions before you vote, please call us at
1-800-544-8888. We will be glad to help you get your vote in quickly.
Thank you for your participation in this important initiative for your
fund.
Sincerely,
[signature]
Edward C. Johnson 3d
President
Important information to help you understand and vote on the proposals
Please read the full text of the enclosed proxy statement. Below is a
brief overview of the proposal to be voted upon. Your vote is
important. If you have any questions regarding the proposal, please
call us at 1-800-544-8888. We appreciate you placing your trust in
Fidelity and look forward to helping you achieve your financial goals.
WHAT PROPOSAL AM I BEING ASKED TO VOTE ON?
(solid bullet) To approve a merger of Spartan Intermediate Municipal
Income Fund into Fidelity Limited Term Municipal Income Fund.
(Proposal 1)
WHAT IS THE REASON FOR AND ADVANTAGE OF THIS MERGER?
The proposed merger is part of a wider strategy by Fidelity to reduce
the number of municipal bond funds it manages. Combining the funds
will allow Fidelity to concentrate on a single, intermediate national
municipal bond fund. Shareholders would also benefit from the more
efficient product line through lower expenses, guaranteed through
December 31, 1999.
DO THE FUNDS BEING MERGED HAVE SIMILAR INVESTMENT POLICIES?
Spartan Intermediate and Fidelity Limited Term have substantially
similar investment objectives and policies.
SPARTAN INTERMEDIATE seeks high current income free from federal
income tax. FIDELITY LIMITED TERM also seeks high current income free
from federal income tax, consistent with the preservation of capital,
from a diversified portfolio of investment-grade securities.
Both funds are managed to have the same interest rate sensitivity as
municipal bonds with maturities between seven and ten years. Both
funds also maintain an average maturity between three and ten years.
As of September 30, 1997, the dollar-weighted average maturity was 7.5
years for both Spartan Intermediate and Fidelity Limited Term.
As a matter of fundamental policy, Spartan Intermediate and Fidelity
Limited Term each will normally invest so that at least 80% of its
assets are invested in municipal securities whose interest is free
from federal income tax.
WHO IS THE FUND MANAGER FOR THESE FUNDS?
Norman Lind currently manages Spartan Intermediate. David Murphy
currently manages Fidelity Limited Term (and is expected to manage the
combined fund).
HOW DO THE EXPENSE STRUCTURES AND FEES OF THE FUNDS COMPARE?
Both funds currently have the same expense ratios, equal to 0.55% of
average net assets per year. The combined fund's expense ratio would
be lower through December 31, 1999, at 0.53%.
Although the funds' expense ratios are currently the same, they have
different contracts with Fidelity. SPARTAN INTERMEDIATE pays an
"all-inclusive" management fee to Fidelity Management & Research
Company (FMR) at a rate of 0.55% of average net assets which covers
substantially all fund expenses.
FIDELITY LIMITED TERM has an expense structure that charges separately
for management fees and other operating expenses. Fidelity Limited
Term's management fee is income-based and calculated at an annual rate
of 0.10% of its average net assets plus 5% of its gross income. As of
April 1, 1997, FMR has voluntarily agreed to reimburse the fund to the
extent that the total operating expenses exceed 0.55% of average net
assets.
If the merger is approved, the combined fund will retain Fidelity
Limited Term's current expense structure. However, FMR has agreed to
limit the combined fund's expense ratio to 0.53% of average net assets
through December 31, 1999. This represents an expense reduction of
0.02% of each fund's average net assets per year. After that date,
the combined fund's expenses could increase or decrease.
WHAT WILL BE THE NAME OF THE SURVIVING FUND AFTER THE MERGERS ARE
COMPLETE?
If shareholders of Spartan Intermediate approve the merger of their
fund into Fidelity Limited Term, the combined fund's name will be
changed to Spartan Intermediate Municipal Income Fund. The new name
of the combined fund would be effective immediately following the
completion of the merger.
WHAT ARE THE FEDERAL TAX IMPLICATIONS OF THE MERGER?
The merger will not be a taxable event (i.e., no gain or loss will be
recognized for federal income tax purposes) to either fund or its
shareholders.
WHAT WILL BE THE SIZE OF THE COMBINED FUND AFTER THE MERGER?
If the merger proposal passes, the combined fund will have over $1
billion in assets.
HOW HAS FIDELITY LIMITED TERM PERFORMED?
The table below shows average annual total returns for both Fidelity
Limited Term and its Lipper peer group over the last 1, 5, and 10 year
periods.
AVERAGE ANNUAL TOTAL RETURN AS OF SEPTEMBER 30, 1997
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1 YEAR 5 YEARS 10 YEARS
Fidelity Limited Term 8.45% 6.65% 7.83%
Lipper Intermediate Municipal Debt Funds Average 7.22% 6.09% 7.33%
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Please keep in mind that past performance is no guarantee of future
results and you may have a gain or loss when you sell your shares.
HOW WILL YOU DETERMINE THE NUMBER OF SHARES OF FIDELITY LIMITED TERM
THAT I WILL RECEIVE?
As of 4 P.M. Eastern time on the Closing Date of the merger,
shareholders of Spartan Intermediate will receive the number of full
and fractional shares of Fidelity Limited Term that is equal in value
to the aggregate net asset value of their shares on that date. The
anticipated Closing Date is February 26, 1998.
Please note that the Shareholder Meeting could be adjourned or the
Closing Date could be adjusted.
WHAT IMPACT WILL THE MERGER HAVE ON THE SHARE PRICE OF FIDELITY
LIMITED TERM?
The net asset value per share of Fidelity Limited Term will not be
affected by the merger.
WHAT IF THERE ARE NOT ENOUGH VOTES TO REACH QUORUM BY THE SCHEDULED
SHAREHOLDER MEETING DATE?
To facilitate receiving sufficient votes, we will need to take further
action. We or D.F. King & Co., Inc., a proxy solicitation firm, may
contact you by mail or telephone. Therefore, we encourage
shareholders to vote as soon as they review the enclosed proxy
materials to avoid additional mailings or telephone calls.
If there are not sufficient votes to approve the proposals by the time
of the Shareholder Meeting (February 18, 1998), the meeting may be
adjourned to permit further solicitation of proxy votes.
WHAT HAPPENS IF THE PROPOSAL FOR MY FUND IS NOT APPROVED?
If the proposal to merge your fund is not approved by shareholders,
the Board may consider other options.
HOW DO I VOTE MY SHARES?
You can vote your shares by completing and signing the enclosed proxy
card, and mailing it in the enclosed postage paid envelope. If you
need any assistance, or have any questions regarding the proposal or
how to vote your shares, please call us at 1-800-544-8888.
HOW DO I SIGN THE PROXY CARD?
INDIVIDUAL ACCOUNTS: Shareholders should sign exactly as their names
appear on the account registration shown on the card.
JOINT ACCOUNTS: Either owner may sign, but the name of the person
signing should conform exactly to a name shown in the registration.
ALL OTHER ACCOUNTS: The person signing must indicate his or her
capacity. For example, a trustee for a trust or other entity should
sign, "Ann B. Collins, Trustee."
NOT AUTHORIZED FOR DISTRIBUTION UNLESS PRECEDED OR ACCOMPANIED BY A
CURRENT FUND PROSPECTUS.
Average annual total returns for the period ended 9/30/97 are
historical and include changes in share price, reinvestment of
dividends and capital gains. Share price and return will vary.
Lipper Analytical Services, Inc. is a nationally recognized
organization that provides performance information for mutual funds.
Each fund is classified within a universe of funds similar in
investment objective. Peer group averages include the reinvestment of
dividends and capital gains, if any, and exclude sales charges.
Fidelity Distributors Corporation, General Distribution Agent for
Fidelity Mutual Funds. 100 Summer Street, Boston, MA 02110.
Brokerage services provided by Fidelity Brokerage Services, Inc.
Member NYSE, SIPC.
Vote this proxy card TODAY! Your prompt response will
save the expense of additional mailings.
Return the proxy card in the enclosed envelope or mail to:
FIDELITY INVESTMENTS
Proxy Department
P.O. Box 9107
Hingham, MA 02043-9848
PLEASE DETACH AT PERFORATION BEFORE MAILING.
- ---------------------------------------------------------------------
- -------------------------
FIDELITY UNION STREET TRUST: SPARTAN INTERMEDIATE MUNICIPAL INCOME
FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward
C. Johnson 3d, Arthur S. Loring, and ____________, or any one or more
of them, attorneys, with full power of substitution, to vote all
shares of Fidelity Union Street Trust: Spartan Intermediate Municipal
Income Fund which the undersigned is entitled to vote at the Special
Meeting of Shareholders of the fund to be held at the office of the
trust at 82 Devonshire St., Boston, MA 02109, on February 18, 1998 at
9:00 a.m. Eastern time and at any adjournments thereof. All powers
may be exercised by a majority of said proxy holders or substitutes
voting or acting or, if only one votes and acts, then by that one.
This Proxy shall be voted on the proposals described in the Proxy
Statement as specified on the reverse side. Receipt of the Notice of
the Meeting and the accompanying Proxy Statement is hereby
acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When
signing in a fiduciary capacity, such as executor, administrator,
trustee, attorney, guardian, etc., please so indicate. Corporate and
partnership proxies should be signed by an authorized person
indicating the person's title.
Date _____________, 1998
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
cusip # 316448802/fund# 443
Please refer to the Proxy Statement discussion of this matter.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE
PROPOSAL.
As to any other matter, said attorneys shall vote in accordance with
their best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR THE FOLLOWING:
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- -------------------------
_____________________________________________________________________
________________________
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1. To approve an Agreement and Plan of Reorganization FOR [ ] AGAINST [ ] ABSTAIN [ ] 1.
between Spartan Intermediate Municipal Income
Fund and Fidelity School Street Trust: Fidelity
Limited Term Municipal Income Fund, providing for
the transfer of all of the assets of Spartan Intermediate
Municipal Income Fund to Fidelity Limited Term
Municipal Income Fund in exchange solely for shares
of beneficial interest of Fidelity Limited Term
Municipal Income Fund and the assumption by
Fidelity Limited Term Municipal Income Fund of
Spartan Intermediate Municipal Income Fund's
liabilities, followed by the distribution of Fidelity
Limited Term Municipal Income Fund shares to
shareholders of Spartan Intermediate Municipal
Income Fund in liquidation of Spartan Intermediate
Municipal Income Fund.
</TABLE>
SIM-PXC-1297 cusip # 316448802/fund# 443
SPARTAN(registered trademark)INTERMEDIATE MUNICIPAL INCOME FUND
A FUND OF
FIDELITY UNION STREET TRUST
82 DEVONSHIRE STREET, BOSTON, MASSACHUSETTS 02109
1-800-544-8888
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To the Shareholders of Spartan Intermediate Municipal Income Fund:
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders (the
Meeting) of Spartan Intermediate Municipal Income Fund (the fund) will
be held at the office of Fidelity Union Street Trust (the trust), 82
Devonshire Street, Boston, Massachusetts 02109 on February 18, 1998,
at 9:00 a.m. Eastern time. The purpose of the Meeting is to consider
and act upon the following proposal, and to transact such other
business as may properly come before the Meeting or any adjournments
thereof.
(1) To approve an Agreement and Plan of Reorganization between
Spartan Intermediate Municipal Income Fund and Fidelity School Street
Trust: Fidelity Limited Term Municipal Income Fund, providing for the
transfer of all of the assets of Spartan Intermediate Municipal Income
Fund to Fidelity Limited Term Municipal Income Fund in exchange solely
for shares of beneficial interest of Fidelity Limited Term Municipal
Income Fund and the assumption by Fidelity Limited Term Municipal
Income Fund of Spartan Intermediate Municipal Income Fund's
liabilities, followed by the distribution of Fidelity Limited Term
Municipal Income Fund shares to shareholders of Spartan Intermediate
Municipal Income Fund in liquidation of Spartan Intermediate Municipal
Income Fund.
The Board of Trustees has fixed the close of business on December 22,
1997 as the record date for the determination of the shareholders of
Spartan Intermediate Municipal Income Fund entitled to notice of, and
to vote at, such Meeting and any adjournments thereof.
By order of the Board of Trustees,
ARTHUR S. LORING, Secretary
December 22, 1997
YOUR VOTE IS IMPORTANT -
PLEASE RETURN YOUR PROXY CARD PROMPTLY.
SHAREHOLDERS ARE INVITED TO ATTEND THE MEETING IN PERSON. ANY
SHAREHOLDER WHO DOES NOT EXPECT TO ATTEND THE MEETING IS URGED TO
INDICATE VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD, DATE AND SIGN
IT, AND RETURN IT IN THE ENVELOPE PROVIDED, WHICH NEEDS NO POSTAGE IF
MAILED IN THE UNITED STATES. IN ORDER TO AVOID UNNECESSARY EXPENSE, WE
ASK YOUR COOPERATION IN MAILING YOUR PROXY CARD PROMPTLY, NO MATTER
HOW LARGE OR SMALL YOUR HOLDINGS MAY BE.
INSTRUCTIONS FOR EXECUTING PROXY CARD
The following general rules for executing proxy cards may be of
assistance to you and help avoid the time and expense involved in
validating your vote if you fail to execute your proxy card properly.
1. INDIVIDUAL ACCOUNTS: Your name should be signed exactly as it
appears in the registration on the proxy card.
2. JOINT ACCOUNTS: Either party may sign, but the name of the party
signing should conform exactly to a name shown in the registration.
3. ALL OTHER ACCOUNTS should show the capacity of the individual
signing. This can be shown either in the form of the account
registration itself or by the individual executing the proxy card. For
example:
REGISTRATION VALID SIGNATURE
A. 1) ABC Corp. John Smith, Treasurer
2) ABC Corp. John Smith, Treasurer
c/o John Smith, Treasurer
B. 1) ABC Corp. Profit Sharing Plan Ann B. Collins,
Trustee
2) ABC Trust Ann B. Collins,
Trustee
3) Ann B. Collins, Trustee Ann B. Collins,
Trustee
u/t/d 12/28/78
C. 1) Anthony B. Craft, Cust. Anthony B. Craft
f/b/o Anthony B. Craft, Jr.
UGMA
SPARTAN INTERMEDIATE MUNICIPAL INCOME FUND
A FUND OF
FIDELITY UNION STREET TRUST
82 DEVONSHIRE STREET, BOSTON, MASSACHUSETTS 02109
1-800-544-8888
PROXY STATEMENT AND PROSPECTUS
DECEMBER 22, 1997
This Proxy Statement and Prospectus (Proxy Statement) is being
furnished to shareholders of Spartan Intermediate Municipal Income
Fund (Spartan Intermediate) (the fund), a fund of Fidelity Union
Street Trust (the trust), in connection with the solicitation of
proxies by the trust's Board of Trustees for use at the Special
Meeting of Shareholders of Spartan Intermediate and at any
adjournments thereof (the Meeting). The Meeting will be held on
Wednesday, February 18, 1998 at 9:00 a.m. Eastern time at 82
Devonshire Street, Boston, Massachusetts 02109, the principal
executive office of the trust.
As more fully described in the Proxy Statement, the purpose of the
Meeting is to vote on a proposed reorganization (Reorganization).
Pursuant to an Agreement and Plan of Reorganization (the Agreement),
Spartan Intermediate would transfer all of its assets to Fidelity
School Street Trust: Fidelity Limited Term Municipal Income Fund
(Fidelity Limited Term), in exchange solely for shares of beneficial
interest of Fidelity Limited Term and the assumption by Fidelity
Limited Term of Spartan Intermediate's liabilities. The number of
shares to be issued in the proposed Reorganization will be based upon
the relative net asset values of the funds at the time of the
exchange. As provided in the Agreement, Spartan Intermediate will
distribute shares of Fidelity Limited Term to its shareholders in
liquidation of Spartan Intermediate on February 26, 1998, or such
other date as the parties may agree (the Closing Date).
Fidelity Limited Term, a municipal bond fund, is a diversified fund
of Fidelity School Street Trust, an open-end management investment
company organized as a Massachusetts business trust on September 10,
1976. Fidelity Limited Term's investment objective is to seek high
current income that is free from federal income tax as is consistent
with the preservation of capital. Fidelity Limited Term seeks to
achieve its investment objective by normally investing in
investment-grade municipal securities, while maintaining an average
maturity of between three and 10 years.
This Proxy Statement, which should be retained for future reference,
sets forth concisely the information about the Reorganization and
Fidelity Limited Term that a shareholder should know before voting on
the proposed Reorganization. The Statement of Additional Information
relating to this Proxy Statement dated December 22, 1997 has been
filed with the Securities and Exchange Commission (SEC) and is
incorporated herein by reference. This Proxy Statement is accompanied
by the Prospectus (dated February 28, 1997 and supplemented August 29,
1997), which offers shares of Fidelity Limited Term. The Statement of
Additional Information for Fidelity Limited Term (dated February 28,
1997) is available upon request. Attachment 1 contains excerpts from
the Annual Report of Fidelity Limited Term dated December 31, 1996.
The Prospectus and Statement of Additional Information for Fidelity
Limited Term have been filed with the SEC and are incorporated herein
by reference. A Prospectus and Statement of Additional Information for
Spartan Intermediate, both dated October 21, 1997, have been filed
with the SEC and are incorporated herein by reference. Copies of these
documents may be obtained without charge by contacting the trust or
Fidelity School Street Trust at Fidelity Distributors Corporation, 82
Devonshire Street, Boston, Massachusetts 02109 or by calling
1-800-544-8888.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND
EXCHANGE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROXY
STATEMENT AND PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
TABLE OF CONTENTS
VOTING INFORMATION
SYNOPSIS
COMPARISON OF OTHER POLICIES OF THE FUNDS
COMPARISON OF PRINCIPAL RISK FACTORS
THE PROPOSED TRANSACTION
ADDITIONAL INFORMATION ABOUT FIDELITY LIMITED TERM MUNICIPAL INCOME
FUND
MISCELLANEOUS
ATTACHMENT 1. EXCERPTS FROM ANNUAL REPORT OF FIDELITY LIMITED TERM
MUNICIPAL INCOME FUND DATED DECEMBER 31, 1996
EXHIBIT 1. FORM OF AGREEMENT AND PLAN OF REORGANIZATION OF SPARTAN
INTERMEDIATE MUNICIPAL INCOME FUND
PROXY STATEMENT AND PROSPECTUS
SPECIAL MEETING OF SHAREHOLDERS OF
SPARTAN INTERMEDIATE MUNICIPAL INCOME FUND
A FUND OF
FIDELITY UNION STREET TRUST
82 DEVONSHIRE STREET, BOSTON, MASSACHUSETTS 02109
1-800-544-8888
TO BE HELD ON FEBRUARY 18, 1998
VOTING INFORMATION
This Proxy Statement and Prospectus (Proxy Statement) is furnished in
connection with a solicitation of proxies made by, and on behalf of,
the Board of Trustees of Fidelity Union Street Trust (the trust) to be
used at the Special Meeting of Shareholders of Spartan Intermediate
Municipal Income Fund (Spartan Intermediate) (the fund) and at any
adjournments thereof (the Meeting), to be held on Wednesday, February
18, 1998 at 9:00 a.m. at 82 Devonshire Street, Boston, Massachusetts
02109, the principal executive office of the trust and Fidelity
Management & Research Company (FMR), the fund's investment adviser.
The purpose of the Meeting is set forth in the accompanying Notice.
The solicitation is made primarily by the mailing of this Proxy
Statement and the accompanying proxy card on or about December 22,
1997. Supplementary solicitations may be made by mail, telephone,
telegraph, facsimile, electronic means or by personal interview by
representatives of the trust. In addition, D.F. King & Co., Inc.
and/or Management Information Services Corp. may be paid on a per-call
basis to solicit shareholders on behalf of the fund at an anticipated
cost of approximately $4,000. The expenses in connection with
preparing this Proxy Statement and its enclosures and of all
solicitations will be borne by FMR. FMR will reimburse brokerage firms
and others for their reasonable expenses in forwarding solicitation
material to the beneficial owners of shares.
If the enclosed proxy card is executed and returned, it may
nevertheless be revoked at any time prior to its use by written
notification received by the trust, by the execution of a later-dated
proxy card, or by attending the Meeting and voting in person.
All proxy cards solicited by the Board of Trustees that are properly
executed and received by the Secretary prior to the Meeting, and which
are not revoked, will be voted at the Meeting. Shares represented by
such proxies will be voted in accordance with the instructions
thereon. If no specification is made on a proxy card, it will be voted
FOR the matters specified on the proxy card. Only proxies that are
voted will be counted toward establishing a quorum. Broker non-votes
are not considered voted for this purpose. Shareholders should note
that while votes to ABSTAIN will count toward establishing a quorum,
passage of any proposal being considered at the Meeting will occur
only if a sufficient number of votes are cast FOR the proposal.
Accordingly, votes to ABSTAIN and votes AGAINST will have the same
effect in determining whether the proposal is approved.
Spartan Intermediate may also arrange to have votes recorded by
telephone. D.F. King & Co., Inc. may be paid on a per-call basis for
vote-by-phone solicitations on behalf of the fund at an anticipated
cost of approximately $4,000. The expenses in connection with
telephone voting will be borne by FMR. If the fund records votes by
telephone, it will use procedures designed to authenticate
shareholders' identities, to allow shareholders to authorize the
voting of their shares in accordance with their instructions, and to
confirm that their instructions have been properly recorded. Proxies
given by telephone may be revoked at any time before they are voted in
the same manner that proxies voted by mail may be revoked.
If a quorum is not present at the Meeting, or if a quorum is present
at the Meeting but sufficient votes to approve one or more of the
proposed items are not received, or if other matters arise requiring
shareholder attention, the persons named as proxy agents may propose
one or more adjournments of the Meeting to permit further solicitation
of proxies. Any such adjournment will require the affirmative vote of
a majority of those shares present at the Meeting or represented by
proxy. When voting on a proposed adjournment, the persons named as
proxy agents will vote FOR the proposed adjournment all shares that
they are entitled to vote with respect to each item, unless directed
to vote AGAINST the item, in which case such shares will be voted
against the proposed adjournment with respect to that item. A
shareholder vote may be taken on one or more of the items in this
Proxy Statement or on any other business properly presented at the
meeting prior to such adjournment if sufficient votes have been
received and it is otherwise appropriate.
On August 31, 1997, there were 19,603,906 and 90,194,004 shares
issued and outstanding for Spartan Intermediate and Fidelity Limited
Term Municipal Income Fund (Fidelity Limited Term), respectively.
Shareholders of record at the close of business on December 22, 1997
will be entitled to vote at the Meeting. Each such shareholder will be
entitled to one vote for each dollar of net asset value held on that
date.
As of August 31, 1997, the Trustees, Members of the Advisory Board,
and officers of each fund owned, in the aggregate, less than 1% of
each fund's total outstanding shares.
As of August 31, 1997, the following owned of record 5% or more of a
fund's outstanding shares:
Fidelity Limited Term: National Financial Services Corporation,
Boston, MA (5.27%).
Spartan Intermediate: National Financial Services Corporation,
Boston, MA (29.34%).
To the knowledge of the trust and Fidelity School Street Trust, no
other shareholder owned of record or beneficially 5% or more of the
outstanding shares of each fund on that date. If the Reorganization
became effective on August 31, 1997, National Financial Services
Corporation would have owned of record 9.57% of the outstanding shares
of the combined fund.
VOTE REQUIRED: APPROVAL OF THE REORGANIZATION REQUIRES THE AFFIRMATIVE
VOTE OF A "MAJORITY OF THE OUTSTANDING VOTING SECURITIES" OF SPARTAN
INTERMEDIATE. UNDER THE INVESTMENT COMPANY ACT OF 1940 (THE 1940 ACT),
THE VOTE OF A "MAJORITY OF THE OUTSTANDING VOTING SECURITIES" MEANS
THE AFFIRMATIVE VOTE OF THE LESSER OF (A) 67% OR MORE OF THE VOTING
SECURITIES PRESENT AT THE MEETING OR REPRESENTED BY PROXY IF THE
HOLDERS OF MORE THAN 50% OF THE OUTSTANDING VOTING SECURITIES ARE
PRESENT OR REPRESENTED BY PROXY OR (B) MORE THAN 50% OF THE
OUTSTANDING VOTING SECURITIES. BROKER NON-VOTES ARE NOT CONSIDERED
"PRESENT" FOR THIS PURPOSE.
SYNOPSIS
The following is a summary of certain information contained elsewhere
in this Proxy Statement, in the Agreement, and in the Prospectuses of
Spartan Intermediate and Fidelity Limited Term, which are incorporated
herein by this reference. Shareholders should read the entire Proxy
Statement and the Prospectus of Fidelity Limited Term carefully for
more complete information.
The proposed reorganization (the Reorganization) would merge Spartan
Intermediate into Fidelity Limited Term, a municipal bond fund also
managed by FMR. If the Reorganization is approved, Spartan
Intermediate will cease to exist and current shareholders of the fund
will become shareholders of Fidelity Limited Term instead. FMR
anticipates that if the Reorganization is approved, the combined
fund's name will be changed to Spartan Intermediate Municipal Income
Fund immediately following completion of the Reorganization.
Both Spartan Intermediate and Fidelity Limited Term seek high current
income free from federal income tax by investing in investment-grade
municipal securities. Spartan Intermediate is managed by Norman Lind
and Fidelity Limited Term is managed by David Murphy. David Murphy is
expected to manage the combined fund. The two funds differ primarily
in their expense structures.
The proposed merger is part of a wider strategy by Fidelity to reduce
the number of municipal bond funds it manages. Combining the funds
will allow Fidelity to concentrate on a single intermediate municipal
bond fund for investors, and deliver lower operating expenses as well.
INVESTMENT OBJECTIVES AND POLICIES
Spartan Intermediate and Fidelity Limited Term have substantially
similar investment objectives and similar investment policies.
Spartan Intermediate seeks high current income free from federal
income tax. Fidelity Limited Term seeks high current income free from
federal income tax, consistent with the preservation of capital, from
a diversified portfolio of investment-grade securities. Both funds are
managed to have the same interest rate sensitivity as municipal bonds
with maturities between seven and 10 years and to maintain an average
maturity between three and 10 years. As of June 30, 1997, the
dollar-weighted average maturity for both Spartan Intermediate and
Fidelity Limited Term was 7.4 years. As a matter of fundamental
policy, Spartan Intermediate and Fidelity Limited Term each will
normally invest so that at least 80% of its assets are invested in
municipal securities whose interest is free from federal income tax.
Spartan Intermediate is a non-diversified fund and Fidelity Limited
Term is a diversified fund. As a non-diversified fund, Spartan
Intermediate can invest a greater portion of its assets in securities
of individual issuers than Fidelity Limited Term and may be more
sensitive than Fidelity Limited Term to changes in the market value of
a single issuer.
EXPENSE STRUCTURES
Spartan Intermediate and Fidelity Limited Term differ with respect to
the contractual structure of fund expenses. Spartan Intermediate pays
an "all-inclusive" management fee to FMR (at a rate of 0.55% of
average net assets per year) which covers substantially all fund
expenses. Fidelity Limited Term, by contrast, pays an income-based
management fee (calculated at an annual rate of 0.10% of the fund's
average net assets plus 5% of gross income) and other expenses
separately. FMR has voluntarily agreed to reimburse Fidelity Limited
Term to the extent that total operating expenses exceed 0.55% of
average net assets. If the Reorganization is approved, FMR has agreed
to limit the combined fund's expense ratio to 0.53% of average net
assets through December 31, 1999 (excluding interest, taxes, brokerage
commissions, and extraordinary expenses). After that date, the
combined fund's expenses could increase.
In sum, the Reorganization would provide Spartan Intermediate's
shareholders with a 0.02% total operating expense reduction over
Spartan Intermediate's current management fee of 0.55% of average net
assets per year, with expenses guaranteed to be lower than Spartan
Intermediate's for a period of almost two years. Further, the
Reorganization would provide Spartan Intermediate's shareholders with
the opportunity to participate in a fund with a comparable investment
portfolio and similar historical investment performance.
The Board of Trustees believes that the Reorganization would benefit
Spartan Intermediate shareholders and recommends that shareholders
vote in favor of the Reorganization.
THE PROPOSED REORGANIZATION
Shareholders of Spartan Intermediate will be asked at the Meeting to
vote upon and approve the Reorganization and the Agreement, which
provide for the acquisition by Fidelity Limited Term of all of the
assets of Spartan Intermediate in exchange solely for shares of
Fidelity Limited Term and the assumption by Fidelity Limited Term of
the liabilities of Spartan Intermediate. Spartan Intermediate will
then distribute the shares of Fidelity Limited Term to its
shareholders, so that each shareholder will receive the number of full
and fractional shares of Fidelity Limited Term equal in value to the
aggregate net asset value of the shareholder's shares of Spartan
Intermediate on the Closing Date (defined below). The exchange of
Spartan Intermediate's assets for Fidelity Limited Term's shares will
occur as of 4:00 p.m. Eastern time on February 26, 1998, or such other
time and date as the parties may agree (the Closing Date). Spartan
Intermediate will then be liquidated as soon as practicable
thereafter.
The funds have received an opinion of counsel that, except with
respect to Section 1256 contracts, the Reorganization will not result
in any gain or loss for Federal income tax purposes either to Spartan
Intermediate or Fidelity Limited Term, or to the shareholders of
either fund. The rights and privileges of the former shareholders of
Spartan Intermediate will be effectively unchanged by the
Reorganization.
COMPARATIVE FEE TABLES
Each fund pays a management fee to FMR for managing its investments
and business affairs which is calculated and paid to FMR every month.
Spartan Intermediate pays FMR a management fee at an annual rate of
0.55% of its average net assets. FMR not only provides the fund with
investment advisory and research services, but also pays all of the
fund's expenses, with the exception of fees and expenses of the
non-interested Trustees; interest; taxes; brokerage commissions (if
any); and such nonrecurring expenses as may arise, including costs of
any litigation to which a fund may be a party, and any obligation it
may have to indemnify its officers and Trustees with respect to
litigation. The management fee that the fund pays FMR is reduced by an
amount equal to the fees and expenses paid by the fund to the
non-interested Trustees.
In contrast, Fidelity Limited Term pays management fees and other
expenses separately. Fidelity Limited Term's management fee is
calculated at an annual rate of 0.10% of its average net assets plus
5% of its gross income. In addition to the management fee payable by
the fund, Fidelity Limited Term incurs other expenses for services
such as maintaining shareholder records and furnishing shareholder
statements and financial reports. For the fiscal year ended December
31, 1996, Fidelity Limited Term's total management fee rate, other
expenses, and total operating expense ratio were 0.38%, 0.18%, and
0.56%, respectively. Effective April 1, 1997, FMR voluntarily agreed
to limit the total operating expenses of Fidelity Limited Term to
0.55% of average net assets (excluding interest, taxes, brokerage
commissions, and extraordinary expenses).
Fidelity reserves the right to deduct an annual maintenance fee of
$12.00 from accounts in each fund with a value of less than $2,500.
If the Reorganization is approved, the combined fund will retain
Fidelity Limited Term's expense structure, requiring payment of an
income-based management fee and other operating expenses separately.
FMR has agreed to limit the combined fund's expense ratio to 0.53% of
its average net assets through December 31, 1999 (excluding interest,
taxes, brokerage commissions, and extraordinary expenses). This
expense limitation would result in a 0.02% lower total operating
expenses for Spartan Intermediate shareholders beginning on the first
business day after the Closing Date of the Reorganization through
December 31, 1999. After that date, the combined fund's expenses could
increase. If the proposed Reorganization is not approved, Spartan
Intermediate will maintain its current fee structure. For more
information about the funds' current fees, refer to their
Prospectuses.
Under Spartan Intermediate's all-inclusive management fee
arrangement, Spartan Intermediate shareholders currently have the
right to vote on any expense increases over 0.55% of average net
assets. Shareholders of the combined fund would also have the right to
vote on any increases in FMR's management fee; however, because the
management fee would not be all-inclusive, shareholders would not have
the right to vote on all types of expense increases.
The following tables show the fees and expenses of Spartan
Intermediate and Fidelity Limited Term for the 12 months ended June
30, 1997, adjusted to reflect current fees, and pro forma fees for the
combined fund based on the same period after giving effect to the
Reorganization, including the effect of FMR's guaranteed expense
limitation to 0.53% of average net assets through December 31, 1999
(excluding interest, taxes, brokerage commissions, and extraordinary
expenses).
ANNUAL FUND OPERATING EXPENSES
Annual fund operating expenses are paid out of each fund's assets.
Expenses are factored into each fund's share price or dividends and
are not charged directly to shareholder accounts. The following
figures are based on historical expenses, adjusted to reflect current
fees, of each fund and are calculated as a percentage of average net
assets of each fund.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Spartan Fidelity Pro Forma
Intermediate Limited TermA Expenses
Combined FundB
Management Fees (after reimbursement) 0.55% 0.38% 0.36%
Other Expenses 0.00% 0.17% 0.17%
Total Fund Operating Expenses (after reimbursement) 0.55% 0.55% 0.53%
</TABLE>
A Effective April 1, 1997, FMR voluntarily agreed to reimburse the
fund to the extent that total operating expenses exceed 0.55%
(excluding interest, taxes, brokerage commissions, and extraordinary
expenses). If this agreement were not in effect, the management fee,
other expenses, and total fund operating expenses, as a percentage of
average net assets, would have been 0.39%, 0.17%, and 0.56%,
respectively.
B FMR has agreed to limit the combined fund's total operating expenses
to 0.53% of its average net assets (excluding interest, taxes,
brokerage commissions, and extraordinary expenses) through December
31, 1999. If this agreement were not in effect, the management fee,
other expenses, and total operating expenses, as a percentage of
average net assets, would be 0.38%, 0.17%, and 0.55%, respectively.
EXAMPLES OF EFFECT OF FUND EXPENSES
The following table illustrates the expenses on a hypothetical $1,000
investment in each fund under the current and pro forma (combined
fund) expenses calculated at the rates stated above, assuming a 5%
annual return.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
After 1 Year After 3 Years After 5 Years After 10 Years
Spartan Intermediate $6 $18 $31 $69
Fidelity Limited Term $6 $18 $31 $69
Combined Fund $5 $17 $30 $66
</TABLE>
These examples assume that all dividends and other distributions are
reinvested and that the percentage amounts listed under Annual Fund
Operating Expenses remain the same in the years shown. These examples
illustrate the effect of expenses, but are not meant to suggest actual
or expected expenses, which may vary. The assumed return of 5% is not
a prediction of, and does not represent, actual or expected
performance of any fund.
FORMS OF ORGANIZATION
Spartan Intermediate is a non-diversified fund of Fidelity Union
Street Trust, an open-end management investment company organized as a
Massachusetts business trust on March 1, 1974. Fidelity Limited Term
is a diversified fund of Fidelity School Street Trust, an open-end
management company organized as a Massachusetts business trust on
September 10, 1976. The trusts are authorized to issue an unlimited
number of shares of beneficial interest. Because the funds are series
of Massachusetts business trusts, organized under substantially
similar Declarations of Trust, the rights of the security holders of
Spartan Intermediate under state law and the governing documents are
expected to remain unchanged after the Reorganization. For more
information regarding shareholder rights, refer to the section of the
Funds' Statements of Additional Information called "Description of the
Trust."
INVESTMENT OBJECTIVES AND POLICIES
The funds have similar investment objectives and policies in that
both seek high current income free from federal income tax by
investing in investment-grade municipal securities. Fidelity Limited
Term seeks this objective in a manner consistent with the preservation
of capital. Spartan Intermediate is a non-diversified fund and
Fidelity Limited Term is a diversified fund. As a non-diversified
fund, Spartan Intermediate can invest a greater portion of its assets
in securities of individual issuers than Fidelity Limited Term. As a
matter of fundamental policy, Spartan Intermediate and Fidelity
Limited Term each will normally invest so that at least 80% of its
assets are invested in municipal securities whose interest is free
from federal income tax. In addition, Spartan Intermediate and
Fidelity Limited Term may invest all of their assets in municipal
securities issued to finance private activities. The interest from
these securities is a tax-preference item for purposes of the federal
alternative minimum tax.
INVESTMENT POLICIES AND CHARACTERISTICS
The following table summarizes the funds' investment policies and
characteristics.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Interest Rate Average Average Debt Quality AMT
Sensitivity Maturity Maturity Ability
Policy as of
6/30/97
Spartan Intermediate 7-10 years 3-10 years 7.4 years 5% 100%
below inv. grade
Fidelity Limited Term 7-10 years 3-10 years 7.4 years only inv. grade 100%
</TABLE>
Spartan Intermediate and Fidelity Limited Term maintain an average
maturity between three and 10 years. FMR seeks to manage the funds so
that they generally react to changes in interest rates similarly to
municipal bonds with maturities between seven and 10 years. As of June
30, 1997, the average maturity of both Spartan Intermediate and
Fidelity Limited Term was 7.4 years.
As a matter of fundamental policy, Fidelity Limited Term invests only
in investment-grade securities. Spartan Intermediate normally invests
only in investment-grade securities, but reserves the right to invest
up to 5% of its assets in below investment-grade securities. As of
June 30, 1997, both funds held only investment-grade securities. Each
fund currently can invest all of its assets in securities subject to
the federal alternative minimum tax (AMT). The interest from these
investments is a tax-preference item for purposes of the federal
alternative minimum tax. As of June 30, 1997, 28.33% of Spartan
Intermediate's and 3.22% of Fidelity Limited Term's income dividends
were subject to the federal alternative minimum tax.
The investment objective of each fund is fundamental and may not be
changed without the approval of a vote of at least a majority of the
outstanding voting securities of the fund. There can be no assurance
that any fund will achieve its objective. With the exception of
fundamental policies, investment policies of the funds can be changed
without shareholder approval. The differences between the funds
discussed above, except as noted, could be changed without a vote of
shareholders.
PERFORMANCE COMPARISONS OF THE FUNDS
Spartan Intermediate and Fidelity Limited Term have experienced
similar performance, as shown in the tables below. The differential in
performance can be attributed primarily to the funds' historical
differences in portfolio holdings resulting from past differences in
investment policies regarding AMT ability and from the relative asset
size of the funds and their available cash flows.
The following table compares the funds' annual total returns for the
periods indicated. Please note that returns are based on past results
and are not an indication of future performance.
Annual Total Return
(periods ended June 30)
1994 1995 1996 1997
Spartan Intermediate 1.24% 7.19% 6.26% 7.25%
Fidelity Limited Term 0.47% 7.68% 6.27% 7.42%
The following table compares Spartan Intermediate's cumulative total
returns to Fidelity Limited Term's for the period indicated. Please
note that returns are based on past results and are not an indication
of future performance.
Cumulative Total Return
(January 1, 1994 to June 30, 1997)
Spartan Intermediate 16.91%
Fidelity Limited Term 17.63%
The following graph shows the value of a hypothetical $10,000
investment in each of Spartan Intermediate and Fidelity Limited Term
made on January 1, 1994 through June 30, 1997, assuming all
distributions are reinvested. The graph compares the cumulative total
return of Spartan Intermediate to the cumulative total return of
Fidelity Limited Term during this period.
Spartan Limited Term
Intermediate Municipal
Municipal Income Fund
Income Fund (036)
(443)
12/31/93 10000.00 10000.00
01/31/94 10099.08 10113.79
02/28/94 9848.13 9880.94
03/31/94 9445.81 9480.40
04/30/94 9477.28 9533.78
05/31/94 9588.28 9618.75
06/30/94 9570.50 9568.99
07/31/94 9721.76 9747.42
08/31/94 9754.58 9782.09
09/30/94 9647.25 9659.13
10/31/94 9520.91 9527.01
11/30/94 9322.24 9340.48
12/31/94 9496.59 9523.76
01/31/95 9721.35 9771.38
02/28/95 9941.60 10004.41
03/31/95 10054.64 10103.51
04/30/95 10074.48 10105.63
05/31/95 10280.20 10357.22
06/30/95 10258.58 10304.29
07/31/95 10330.84 10382.73
08/31/95 10486.51 10527.11
09/30/95 10569.20 10614.95
10/31/95 10686.16 10737.22
11/30/95 10802.27 10858.45
12/31/95 10867.64 10937.38
01/31/96 10965.10 11038.10
02/29/96 10930.43 11002.77
03/31/96 10823.84 10892.01
04/30/96 10802.31 10870.63
05/31/96 10803.64 10859.49
06/30/96 10900.67 10950.57
07/31/96 10988.71 11032.61
08/31/96 10989.45 11034.19
09/30/96 11098.50 11138.42
10/31/96 11209.79 11267.75
11/30/96 11407.47 11442.80
12/31/96 11363.41 11422.44
01/31/97 11397.60 11459.73
02/28/97 11494.54 11551.77
03/31/97 11350.29 11422.81
04/30/97 11429.27 11495.48
05/31/97 11577.85 11641.99
06/30/97 11691.39 11762.80
COMPARISON OF OTHER POLICIES OF THE FUNDS
DIVERSIFICATION. Spartan Intermediate is a non-diversified fund.
Fidelity Limited Term is a diversified fund. Generally, to meet
federal tax requirements at the close of each quarter, Spartan
Intermediate does not invest more than 25% of its total assets in the
securities of any one issuer and, with respect to 50% of total assets,
does not invest more than 5% of its total assets in the securities of
any one issuer. Fidelity Limited Term, as a matter of fundamental
policy, with respect to 75% of total assets, may not purchase a
security if, as a result, more than 5% would be invested in the
securities of any issuer. Because Spartan Intermediate can invest a
greater portion of its assets in securities of individual issuers than
Fidelity Limited Term, changes in the market value of a single issuer
could cause greater share-price fluctuation in Spartan Intermediate
than would occur in a diversified fund such as Fidelity Limited Term.
OTHER INVESTMENT POLICIES. Each fund may borrow from banks or other
funds advised by FMR, or through reverse repurchase agreements. As a
matter of fundamental policy, each fund may borrow only for temporary
or emergency purposes, but not in an amount exceeding 33 1/3% of its
total assets.
FMR normally invests each fund's assets according to its investment
strategy and does not expect to invest in federally taxable
obligations. However, each fund reserves the right to invest without
limitation in short-term instruments, to hold a substantial amount of
uninvested cash, or to invest more than normally permitted in
federally taxable obligations for temporary, defensive purposes. Each
fund may also enter into when-issued and forward purchase or sale
transactions, invest in asset-backed securities, variable and floating
rate securities, municipal lease obligations, securities with put
features, private entity securities, and illiquid and restricted
securities. As stated above, for more information about the risks and
restrictions associated with these policies, see each fund's
Prospectus, and for a more detailed discussion of the funds'
investments, see their Statements of Additional Information, which are
incorporated herein by reference.
OPERATIONS OF FIDELITY LIMITED TERM FOLLOWING THE REORGANIZATION
FMR does not expect Fidelity Limited Term to revise its investment
policies as a result of the Reorganization. In addition, FMR does not
anticipate significant changes to the fund's management or to agents
that provide the fund with services. Specifically, the Trustees and
officers, the investment adviser, distributor, and other agents will
continue to serve Fidelity Limited Term in their current capacities.
David Murphy, who is currently the Portfolio Manager of Fidelity
Limited Term is expected to continue to be responsible for portfolio
management after the Reorganization.
All of the current investments of Spartan Intermediate are
permissible investments for Fidelity Limited Term. However, if the
Reorganization is approved, portfolio adjustments may be required to
more closely align the funds' portfolios. Transaction costs associated
with such adjustments that occur between shareholder approval and the
Closing Date will be borne by the fund that incurred them and may
result in a taxable gain or loss to the fund. Transaction costs
associated with such adjustments that occur after the Closing Date
will be borne by Fidelity Limited Term.
PURCHASES AND REDEMPTIONS
The purchase and redemption policies for both funds are identical.
The price to buy one share of each fund is each fund's net asset
value per share (NAV). Each fund's shares are sold without a sales
charge. Your shares are purchased at the next NAV calculated after
your investment is received and accepted. Each fund's NAV is normally
calculated each business day at 4:00 p.m. Eastern time. Refer to each
fund's Prospectus for more information regarding how to buy shares.
The price to sell one share of each fund is the fund' NAV. Your
shares will be sold at the next NAV calculated after your order is
received and accepted. Each fund's NAV is normally calculated each
business day at 4:00 p.m. Eastern time.
On April 1, 1997, Spartan Intermediate closed to new accounts pending
the Reorganization. Spartan Intermediate shareholders on or prior to
that date can continue to purchase shares of the fund. Shareholders
may redeem shares through the Closing Date of the Reorganization. If
the Reorganization is approved, the purchase and redemption policies
of the combined fund will remain unchanged. Fidelity Limited Term does
not currently impose a redemption fee; however, the combined fund
reserves the right to adopt a redemption fee in the future if it
believes it is appropriate.
EXCHANGES
The exchange privilege currently offered by each fund is the same and
is not expected to change after the Reorganization. Shareholders of
the funds may exchange their shares of a fund for shares of any other
Fidelity fund available in a shareholder's state. Neither Spartan
Intermediate nor Fidelity Limited Term currently imposes a redemption
fee.
DIVIDENDS AND OTHER DISTRIBUTIONS
Each fund distributes substantially all of its net investment income
and capital gains to shareholders each year. Each fund declares income
dividends daily and pays them monthly. Spartan Intermediate normally
distributes capital gains in October and December. Fidelity Limited
Term normally distributes capital gains in February and December. On
or before the Closing Date, Spartan Intermediate may declare
additional dividends or other distributions in order to distribute
substantially all of its investment company taxable income and net
realized capital gain.
Spartan Intermediate will be required to recognize gain or loss on
Section 1256 contracts held by the fund on the last day of its taxable
year which is August 31. If the Reorganization is approved, gains or
losses of Section 1256 contracts held on the Closing Date will be
recognized on the Closing Date.
FEDERAL INCOME TAX CONSEQUENCES OF THE REORGANIZATION
Each fund has received an opinion of its counsel, Kirkpatrick &
Lockhart LLP, that the Reorganization will constitute a tax-free
reorganization within the meaning of Section 368(a)(1)(C) of the
Internal Revenue Code of 1986, as amended (the Code). Accordingly,
except with respect to Section 1256 contracts, no gain or loss will be
recognized to the funds or their shareholders as a result of the
Reorganization. Please see the section entitled "Federal Income Tax
Considerations" for more information.
As of August 31, 1997, Spartan Intermediate had capital loss
carryforwards for federal income tax purposes of approximately
$8,494,000. As of December 31, 1996, Fidelity Limited Term had no
capital loss carryforwards for federal income tax purposes. Under
current federal tax law, Fidelity Limited Term may be limited to using
only a portion, if any, of its capital loss carryforward or the
capital loss carryforwards transferred by Spartan Intermediate at the
time of the Reorganization ("capital loss carryforwards"). There is no
assurance that Fidelity Limited Term will be able to realize
sufficient capital gains to use the capital loss carryforwards before
they expire. The capital loss carryforward attributable to Spartan
Intermediate will expire between December 31, 2002 and December 31,
2003.
COMPARISON OF PRINCIPAL RISK FACTORS
Each fund is subject to the risks normally associated with bond
funds. As described more fully above, the funds have substantially
similar investment objectives and similar investment policies.
INVESTMENT STRATEGY. As a matter of fundamental policy, Fidelity
Limited Term invests only in investment-grade securities. Spartan
Intermediate currently intends to invest only in investment-grade
securities. However, Spartan Intermediate has the ability to invest up
to 5% of its assets in below investment-grade securities. Although
these securities may provide the potential for significant price
appreciation, it is important to note that they are considered to have
speculative characteristics, and involve greater risk of default or
price changes due to changes in the issuer's creditworthiness, or such
securities may already be in default. The market prices of these
securities may fluctuate more than higher-quality securities and may
decline significantly in periods of general or regional economic
activity.
DIVERSIFICATION. Diversifying a fund's investment portfolio can
reduce the risks of investing. Diversification may include limiting
the amount of money invested in any one issuer. A fund that is not
diversified may be more sensitive to changes in the market value of a
single issuer. Spartan Intermediate is a non-diversified fund.
Fidelity Limited Term is a diversified fund. As a non-diversified
fund, Spartan Intermediate can invest a greater portion of its assets
in securities of individual issuers than Fidelity Limited Term and may
be subject to greater share price fluctuation.
THE PROPOSED TRANSACTION
TO APPROVE AN AGREEMENT AND PLAN OF REORGANIZATION BETWEEN SPARTAN
INTERMEDIATE AND FIDELITY LIMITED TERM.
REORGANIZATION PLAN
The terms and conditions under which the proposed transaction may be
consummated are set forth in the Agreement. Significant provisions of
the Agreement are summarized below; however, this summary is qualified
in its entirety by reference to the Agreement, a copy of which is
attached at Exhibit 1 to this Proxy Statement.
The Agreement contemplates (a) Fidelity Limited Term acquiring as of
the Closing Date all of the assets of Spartan Intermediate in exchange
solely for shares of Fidelity Limited Term and the assumption by
Fidelity Limited Term of Spartan Intermediate's liabilities; and (b)
the distribution of shares of Fidelity Limited Term to the
shareholders of Spartan Intermediate as provided for in the Agreement.
The assets of Spartan Intermediate to be acquired by Fidelity Limited
Term include all cash, cash equivalents, securities, receivables
(including interest or dividends receivables), claims, choses in
action, and other property owned by Spartan Intermediate, and any
deferred or prepaid expenses shown as an asset on the books of Spartan
Intermediate on the Closing Date. Fidelity Limited Term will assume
from Spartan Intermediate all liabilities, debts, obligations, and
duties of Spartan Intermediate of whatever kind or nature, whether
absolute, accrued, contingent, or otherwise, whether or not arising in
the ordinary course of business, whether or not determinable on the
Closing Date, and whether or not specifically referred to in the
Agreement; provided, however, that Spartan Intermediate will use its
best efforts, to the extent practicable, to discharge all of its known
liabilities prior to the Closing Date, other than liabilities incurred
in the ordinary course of business. Fidelity Limited Term also will
deliver to Spartan Intermediate the number of full and fractional
shares of Fidelity Limited Term having an aggregate net asset value
equal to the value of the assets of Spartan Intermediate less the
liabilities of Spartan Intermediate as of the Closing Date. Spartan
Intermediate shall then distribute the Fidelity Limited Term shares
PRO RATA to its shareholders.
The value of Spartan Intermediate's assets to be acquired by Fidelity
Limited Term and the amount of its liabilities to be assumed by
Fidelity Limited Term will be determined as of the close of business
(4:00 p.m. Eastern time) of Spartan Intermediate on the Closing Date,
using the valuation procedures set forth in Spartan Intermediate's
then-current Prospectus and Statement of Additional Information. The
net asset value of a share of Fidelity Limited Term will be determined
as of the same time using the valuation procedures set forth in its
then-current Prospectus and Statement of Additional Information.
As of the Closing Date, Spartan Intermediate will distribute to its
shareholders of record the shares of Fidelity Limited Term it
received, so that each Spartan Intermediate shareholder will receive
the number of full and fractional shares of Fidelity Limited Term
equal in value to the aggregate net asset value of shares of Spartan
Intermediate held by such shareholder on the Closing Date; Spartan
Intermediate will be liquidated as soon as practicable thereafter.
Such distribution will be accomplished by opening accounts on the
books of Fidelity Limited Term in the names of the Spartan
Intermediate shareholders and by transferring thereto shares of
Fidelity Limited Term. Each Spartan Intermediate shareholder's account
shall be credited with the respective PRO RATA number of full and
fractional shares (rounded to the third decimal place) of Fidelity
Limited Term due that shareholder. Fidelity Limited Term shall not
issue certificates representing its shares in connection with such
exchange.
Accordingly, immediately after the Reorganization, each former
Spartan Intermediate shareholder will own shares of Fidelity Limited
Term equal to the aggregate net asset value of that shareholder's
shares of Spartan Intermediate immediately prior to the
Reorganization. The net asset value per share of Fidelity Limited Term
will be unchanged by the transaction. Thus, the Reorganization will
not result in a dilution of any shareholder interest.
Any transfer taxes payable upon issuance of shares of Fidelity
Limited Term in a name other than that of the registered holder of the
shares on the books of Spartan Intermediate as of that time shall be
paid by the person to whom such shares are to be issued as a condition
of such transfer. Any reporting responsibility of Spartan Intermediate
is and will continue to be its responsibility up to and including the
Closing Date and such later date on which Spartan Intermediate is
liquidated.
Pursuant to its all-inclusive management contract with Spartan
Intermediate, FMR will bear the cost of the Reorganization, including
professional fees, expenses associated with the filing of registration
statements, and the cost of soliciting proxies for the Meeting, which
will consist principally of printing and mailing prospectuses and
proxy statements, together with the cost of any supplementary
solicitation. However, there may be some transaction costs associated
with portfolio adjustments to Spartan Intermediate and Fidelity
Limited Term due to the Reorganization prior to the Closing Date which
will be borne by Spartan Intermediate and Fidelity Limited Term,
respectively. Any transaction costs associated with portfolio
adjustments to Spartan Intermediate and Fidelity Limited Term due to
the Reorganization which occur after the Closing Date and any
additional merger-related costs attributable to Fidelity Limited Term
which occur after the Closing Date will be borne by Fidelity Limited
Term. The funds may recognize a taxable gain or loss on the
disposition of securities pursuant to these portfolio adjustments. See
the section entitled "Reasons for the Reorganization."
The consummation of the Reorganization is subject to a number of
conditions set forth in the Agreement, some of which may be waived by
a fund. In addition, the Agreement may be amended in any mutually
agreeable manner, except that no amendment that may have a materially
adverse effect on the shareholders' interests may be made subsequent
to the meeting.
REASONS FOR THE REORGANIZATION
The Boards of Trustees (the Boards) of the funds have determined that
the Reorganization is in the best interests of the shareholders of
both funds and that the Reorganization will not result in a dilution
of the interests of shareholders of either fund.
In considering the Reorganization, the Boards considered a number of
factors, including the following:
(1) the compatibility of the funds' investment objectives and
policies;
(2) the historical performance of the funds;
(3) the relative expense ratios of the funds;
(4) the costs to be incurred by each fund as a result of the
Reorganization;
(5) the tax consequences of the Reorganization;
(6) the relative size of the funds;
(7) the elimination of duplicative funds;
(8) the impact of changes to the municipal bond product line on the
funds and their shareholders; and
(9) the benefit to FMR and to the shareholders of the funds.
FMR recommended the Reorganization to the Boards at a meeting of the
Boards on July 17, 1997. In recommending the Reorganization, FMR also
advised the Boards that the funds have substantially similar
investment objectives and similar policies and permissible
investments. In particular, at that time FMR informed the Boards that
the funds differed with respect to their expense structures and
policies concerning average maturities. If the Reorganization is
approved, Fidelity Limited Term's Board authorized that Fidelity
Limited Term's name be changed to Spartan Intermediate Municipal
Income Fund. In anticipation of this proposed name change, at the July
17, 1997 meeting, Fidelity Limited Term's Board approved a change in
maturity policy for Fidelity Limited Term from 12 years or less to
between three and 10 years, which became effective September 1, 1997.
FMR informed the Boards that both Fidelity Limited Term and Spartan
Intermediate's average maturity as of June 30, 1997 was 7.4 years.
The Boards also considered that former shareholders of Spartan
Intermediate will receive shares of Fidelity Limited Term equal to the
value of their shares of Spartan Intermediate. In addition, the funds
have received an opinion of counsel that, except with respect to
Section 1256 contracts, the Reorganization will not result in any gain
or loss for Federal income tax purposes either to Spartan Intermediate
or Fidelity Limited Term or to shareholders of either fund.
Furthermore, on July 17, 1997, the Boards considered FMR's
representation to the Boards that if the Reorganization is approved,
it would guarantee an expense ratio of 0.53% of average net assets for
the surviving fund (excluding interest, taxes, brokerage commissions,
and extraordinary expenses) following the Closing Date of the
Reorganization through December 31, 1999, resulting in an immediate
savings of 0.02% to shareholders of both Spartan Intermediate and
Fidelity Limited Term (based on total fund operating expenses for the
12 months ended June 30, 1997.) Previously, FMR had informed the
Boards that effective April 1, 1997, it would voluntarily agree to
limit Fidelity Limited Term's total operating expenses to 0.55% of
average net assets. FMR informed the Boards that it would pay all of
Spartan Intermediate's expenses associated with the Reorganization,
including professional fees and the costs of proxy solicitation. The
Boards were informed that any expenses associated with the
Reorganization, including professional fees and any additional
merger-related costs, directly attributable to Fidelity Limited Term
would be borne by Fidelity Limited Term, provided they do not exceed
the fund's 0.55% expense cap.
In addition, Spartan Intermediate's Board also considered that
Spartan Intermediate shareholders currently have the right to vote on
any expense increases over 0.55% of average net assets. Shareholders
of the combined fund would also have the right to vote on any
increases in FMR's management fee; however, because the income-based
management fee would not be all-inclusive, shareholders would not have
the right to vote on all types of expense increases.
Finally, the Boards considered the proposed Reorganization in the
context of a general goal of reducing the number of duplicative funds
managed by FMR. While the reduction of duplicative funds and funds
with lower assets potentially would benefit FMR, it also should
benefit shareholders by facilitating increased operational
efficiencies.
DESCRIPTION OF THE SECURITIES TO BE ISSUED
Fidelity School Street Trust is registered with the Securities and
Exchange Commission (the Commission) as an open-end management
investment company. Trustees of Fidelity School Street Trust are
authorized to issue an unlimited number of shares of beneficial
interest of separate series. Currently, Fidelity Limited Term is the
only fund of Fidelity School Street Trust. Shareholders of Fidelity
Global Bond Fund and Fidelity New Markets Income Fund approved on
September 17, 1997. Agreements and Plans of Reorganization providing
for the reorganization of Fidelity Global Bond Fund and Fidelity New
Markets Income Fund into Fidelity School Street Trust, effective the
end of February, 1998. Each share of Fidelity Limited Term represents
an equal proportionate interest with each other share of the fund, and
each such share of Fidelity Limited Term is entitled to equal voting,
dividend, liquidation, and redemption rights. Each shareholder of the
fund is entitled to one vote for each dollar value of net asset value
of the fund that shareholder owns. Shares of Fidelity Limited Term
have no preemptive or conversion rights. The voting and dividend
rights, the right of redemption, and the privilege of exchange are
described in the fund's Prospectus. Shares are fully paid and
nonassessable, except as set forth in the fund's Statement of
Additional Information under the heading "Shareholder and Trustee
Liability."
Fidelity School Street Trust does not hold annual meetings of
shareholders. There will normally be no meetings of shareholders for
the purpose of electing Trustees unless less than a majority of the
Trustees holding office have been elected by shareholders, at which
time the Trustees then in office will call a shareholder meeting for
the election of Trustees. Under the 1940 Act, shareholders of record
of at least two-thirds of the outstanding shares of an investment
company may remove a Trustee by votes cast in person or by proxy at a
meeting called for that purpose. The Trustees are required to call a
meeting of shareholders for the purpose of voting upon the question of
removal of any Trustee when requested in writing to do so by the
shareholders of record holding at least 10% of Fidelity School Street
Trust's outstanding shares.
FEDERAL INCOME TAX CONSIDERATIONS
The exchange of Spartan Intermediate's assets for Fidelity Limited
Term's shares and the assumption of the liabilities of Spartan
Intermediate by Fidelity Limited Term is intended to qualify for
federal income tax purposes as a tax-free reorganization under the
Code. With respect to the Reorganization, the participating funds have
received an opinion from Kirkpatrick & Lockhart LLP, counsel to
Spartan Intermediate and Fidelity Limited Term, substantially to the
effect that:
(i) The acquisition by Fidelity Limited Term of all of the assets of
Spartan Intermediate solely in exchange for Fidelity Limited Term
shares and the assumption by Fidelity Limited Term of Spartan
Intermediate's liabilities, followed by the distribution by Spartan
Intermediate of Fidelity Limited Term shares to the shareholders of
Spartan Intermediate pursuant to the liquidation of Spartan
Intermediate and constructively in exchange for their Spartan
Intermediate shares, will constitute a reorganization within the
meaning of section 368(a)(1)(C) of the Code, and Spartan Intermediate
and Fidelity Limited Term will each be "a party to a reorganization"
within the meaning of section 368(b) of the Code;
(ii) No gain or loss will be recognized by Spartan Intermediate upon
the transfer of all of its assets to Fidelity Limited Term in exchange
solely for Fidelity Limited Term shares and Fidelity Limited Term's
assumption of Spartan Intermediate's liabilities, followed by Spartan
Intermediate's subsequent distribution of those shares to shareholders
in liquidation of Spartan Intermediate;
(iii) No gain or loss will be recognized by Fidelity Limited Term
upon the receipt of the assets of Spartan Intermediate in exchange
solely for Fidelity Limited Term shares and its assumption of Spartan
Intermediate's liabilities;
(iv) The shareholders of Spartan Intermediate will recognize no gain
or loss upon the exchange of their Spartan Intermediate shares solely
for Fidelity Limited Term shares;
(v) The basis of Spartan Intermediate's assets in the hands of
Fidelity Limited Term will be the same as the basis of those assets in
the hands of Spartan Intermediate immediately prior to the
Reorganization, and the holding period of those assets in the hands of
Fidelity Limited Term will include the holding period of those assets
in the hands of Spartan Intermediate;
(vi) The basis of Spartan Intermediate shareholders in Fidelity
Limited Term shares will be the same as their basis in Spartan
Intermediate shares to be surrendered in exchange therefor; and
(vii) The holding period of the Fidelity Limited Term shares to be
received by the Spartan Intermediate shareholders will include the
period during which the Spartan Intermediate shares to be surrendered
in exchange therefor were held, provided such Spartan Intermediate
shares were held as capital assets by those shareholders on the date
of the Reorganization.
Shareholders of Spartan Intermediate should consult their tax
advisers regarding the effect, if any, of the proposed Reorganization
in light of their individual circumstances. Because the foregoing
discussion only relates to the federal income tax consequences of the
Reorganization, those shareholders also should consult their tax
advisers as to state and local tax consequences, if any, of the
Reorganization.
CAPITALIZATION
The following table shows the capitalization of the funds as of June
30, 1997 and on a pro forma combined basis (unaudited) as of that date
giving effect to the Reorganization.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Net Assets Net Asset Value Per Share Shares Outstanding
Spartan Intermediate $205,245,537 $10.28 19,966,309
Fidelity Limited Term $882,303,000 $9.72 90,786,000
Pro Forma Combined Fund $1,087,548,537 $9.72 111,901,796
</TABLE>
CONCLUSION
The Agreement and Plan of Reorganization and the transactions
provided for therein were approved by the Boards at a meeting held on
July 17, 1997. The Boards of Trustees of Fidelity Union Street Trust
and Fidelity School Street Trust determined that the proposed
Reorganization is in the best interests of shareholders of each fund
and that the interests of existing shareholders of Spartan
Intermediate and Fidelity Limited Term would not be diluted as a
result of the Reorganization. In the event that the Reorganization is
not consummated, Spartan Intermediate will continue to engage in
business as a fund of a registered investment company and the Board of
Fidelity Union Street Trust will consider other proposals for the
reorganization or liquidation of the fund.
ADDITIONAL INFORMATION ABOUT FIDELITY LIMITED TERM
Fidelity Limited Term's Prospectus (dated February 28, 1997 and
supplemented August 29, 1997) is enclosed with this Proxy Statement
and is incorporated herein by reference. The Prospectus contains
additional information about the fund including its investment
objective and policies, investment adviser, advisory fees and
expenses, organization, and procedures for purchasing and redeeming
shares. Fidelity Limited Term's financial highlights for the 10-year
period ended December 31, 1996 and for the unaudited semi-annual
period ended June 30, 1997 are shown below:
FIDELITY LIMITED TERM - FINANCIAL HIGHLIGHTS
<ERROR: WIDE TABLE>
ERROR: The Following Table: "Assets" is Too Wide!
Table Width is 162 characters.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Years
Ended 1997F 1996 1995 1994 1993C 1992 1991 1990 1989 1988 1987
December 31
Selected Per-Share Data
Net asset
value, $ 9.700 $ 9.800 $ 8.990 $ 9.990 $ 9.600 $ 9.520 $ 9.270 $ 9.310 $ 9.230 $ 9.100 $ 9.580
beginning of period
Income from
Investment .244 .488 .497 .512 .516 .573 .603 .615 .617 .600 .582
Operations
Net interest income
Net realized
and .040 (.069) .810 (.980) .630 .180 .400 .010 .080 .130 (.480)
unrealized gain (loss)
Total from
investment .284 .419 1.307 (.468) 1.146 .753 1.003 .625 .697 .730 .102
operations
Less Distri
butions (.244) (.488) (.497) (.512) (.516) (.573) (.603) (.615) (.617) (.600) (.582)
From net interest
income
From net realized
gain (.020) (.031) - (.010) (.220) (.100) (.150) (.050) - - -
In excess
of net - - - (.010) (.020) - - - - - -
realized gain
Total distri
butions (.264) (.519) (.497) (.532) (.756) (.673) (.753) (.665) (.617) (.600) (.582)
Net asset value,
end of $ 9.720 $ 9.700 $ 9.800 $ 8.990 $ 9.990 $ 9.600 $ 9.520 $ 9.270 $ 9.310 $ 9.230 $ 9.100
period
Total
returnB,E 2.98% 4.43% 14.84% (4.76)% 12.24% 8.17% 11.19% 6.97% 7.83% 8.22% 1.14%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of
period $ 882,303 $ 903,726 $ 943,220 $ 878,358 $ 1,199,372 $ 975,904 $ 695,865 $ 468,111 $ 442,413 $ 440,502 $ 459,042
(000 omitted)
Ratio of expenses
to .56% .56% .57% .56% .57% .64% .68% .67% .66%D .67% .74%
average net
assets A
Ratio of net
interest 5.10%A 5.06% 5.25% 5.42% 5.19% 5.94% 6.41% 6.63% 6.70% 6.51% 6.29%
income to average net
assets
Portfolio turnover
rate 13%A 27% 31% 30% 111% 50% 42% 72% 55% 30% 59%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C EFFECTIVE JANUARY 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION
93-2, "DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION
OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT
COMPANIES." AS A RESULT, NET INTEREST INCOME PER SHARE MAY REFLECT
CERTAIN RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
D FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD
HAVE BEEN HIGHER.
E THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
F SIX MONTHS ENDED JUNE 30, 1997 (UNAUDITED).
MISCELLANEOUS
LEGAL MATTERS. Certain legal matters in connection with the issuance
of Fidelity Limited Term shares have been passed upon by Kirkpatrick &
Lockhart LLP, counsel to Fidelity School Street Trust.
EXPERTS. The audited financial statements of Spartan Intermediate and
Fidelity Limited Term, incorporated by reference into the Statement of
Additional Information, have been examined by Coopers & Lybrand
L.L.P., independent accountants, whose reports thereon are included in
the Annual Report to Shareholders for the fiscal years ended August
31, 1996 and August 31, 1997 for Spartan Intermediate, and December
31, 1996 for Fidelity Limited Term. The unaudited financial statements
of Spartan Intermediate for the six-month period ended February 28,
1997 and of Fidelity Limited Term for the six-month period ended June
30, 1997 are also incorporated by reference into the Statement of
Additional Information. The financial statements audited by Coopers &
Lybrand L.L.P. have been incorporated by reference in reliance on
their reports given on their authority as experts in auditing and
accounting.
AVAILABLE INFORMATION. Fidelity Union Street Trust and Fidelity
School Street Trust are each subject to the informational requirements
of the Securities Exchange Act of 1934 and the 1940 Act, and in
accordance therewith file reports, proxy material, and other
information with the SEC. Such reports, proxy material, and other
information can be inspected and copied at the Public Reference Room
maintained by the SEC at 450 Fifth Street, N.W., Washington D.C. 20549
and 7 World Trade Center, New York, NY 10048. Copies of such material
can also be obtained from the Public Reference Branch, Office of
Consumer Affairs and Information Services, Securities and Exchange
Commission, Washington D.C. 20549, at prescribed rates.
NOTICE TO BANKS, BROKER-DEALERS AND VOTING TRUSTEES AND THEIR
NOMINEES. Please advise Fidelity Union Street Trust, in care of
Fidelity Service Company, Inc., P.O. Box 789, Boston, Massachusetts
02109, whether other persons are beneficial owners of shares for which
proxies are being solicited and, if so, the number of copies of the
Proxy Statement you wish to receive in order to supply copies to the
beneficial owners of the respective shares.
ATTACHMENT 1
EXCERPTS FROM ANNUAL REPORT OF FIDELITY LIMITED TERM MUNICIPAL INCOME
FUND DATED DECEMBER 31, 1996
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED DECEMBER 31, 1996 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Limited Term Municipal Income Fund 4.43% 6.76% 6.89%
Lehman Brothers 1-17 Year Municipal Bond Index 4.45% n/a n/a
Intermediate Municipal Debt Funds Average 3.70% 6.11% 6.63%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year. (Note: Lipper calculates average annual total
returns by annualizing each fund's total return, then taking an
arithmetic average. This may produce a slightly different figure than
that obtained by averaging the cumulative total returns and
annualizing the result.)
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19961231 19970117 111239 S00000000000001
Limited Term Muni Income LB Municipal Bond
00036 LB015
1986/12/31 10000.00 10000.00
1987/01/31 10238.94 10301.10
1987/02/28 10362.68 10351.78
1987/03/31 10307.21 10242.05
1987/04/30 9745.22 9728.11
1987/05/31 9722.60 9679.85
1987/06/30 9934.27 9964.06
1987/07/31 10050.56 10065.69
1987/08/31 10081.27 10088.34
1987/09/30 9689.04 9716.38
1987/10/31 9743.36 9750.78
1987/11/30 9972.28 10005.37
1987/12/31 10114.35 10150.55
1988/01/31 10513.15 10512.11
1988/02/29 10557.01 10623.22
1988/03/31 10376.21 10499.99
1988/04/30 10443.27 10579.79
1988/05/31 10477.04 10549.22
1988/06/30 10567.94 10703.55
1988/07/31 10613.97 10773.34
1988/08/31 10626.00 10782.82
1988/09/30 10754.20 10977.99
1988/10/31 10895.98 11171.20
1988/11/30 10838.06 11068.87
1988/12/31 10945.39 11182.11
1989/01/31 11065.38 11413.35
1989/02/28 10983.96 11283.13
1989/03/31 10938.58 11256.16
1989/04/30 11133.53 11523.38
1989/05/31 11318.02 11762.72
1989/06/30 11429.17 11922.46
1989/07/31 11541.02 12084.72
1989/08/31 11481.31 11966.42
1989/09/30 11473.72 11930.76
1989/10/31 11573.60 12076.67
1989/11/30 11712.79 12288.01
1989/12/31 11801.90 12388.53
1990/01/31 11762.36 12329.93
1990/02/28 11850.74 12439.66
1990/03/31 11892.42 12443.40
1990/04/30 11789.53 12353.31
1990/05/31 11971.52 12622.98
1990/06/30 12063.15 12733.94
1990/07/31 12207.94 12921.12
1990/08/31 12184.27 12733.51
1990/09/30 12266.79 12740.77
1990/10/31 12391.23 12971.88
1990/11/30 12555.98 13232.75
1990/12/31 12623.98 13290.31
1991/01/31 12760.76 13468.67
1991/02/28 12884.56 13585.85
1991/03/31 12941.97 13590.74
1991/04/30 13081.08 13771.49
1991/05/31 13180.02 13893.92
1991/06/30 13183.46 13880.17
1991/07/31 13326.39 14049.23
1991/08/31 13454.58 14234.26
1991/09/30 13624.13 14419.59
1991/10/31 13751.39 14549.36
1991/11/30 13761.03 14589.95
1991/12/31 14036.20 14903.05
1992/01/31 14113.44 14937.03
1992/02/29 14165.04 14941.81
1992/03/31 14135.78 14947.34
1992/04/30 14254.69 15080.37
1992/05/31 14375.83 15257.87
1992/06/30 14538.53 15513.90
1992/07/31 14961.25 15979.00
1992/08/31 14850.18 15823.21
1992/09/30 14920.75 15926.69
1992/10/31 14715.38 15770.13
1992/11/30 15016.56 16052.58
1992/12/31 15182.61 16216.47
1993/01/31 15363.70 16405.07
1993/02/28 15918.71 16998.44
1993/03/31 15763.90 16818.77
1993/04/30 15913.46 16988.47
1993/05/31 16015.60 17083.94
1993/06/30 16229.76 17369.08
1993/07/31 16269.17 17391.83
1993/08/31 16601.60 17753.93
1993/09/30 16786.12 17956.14
1993/10/31 16809.78 17990.80
1993/11/30 16698.65 17832.30
1993/12/31 17040.99 18208.74
1994/01/31 17234.89 18416.68
1994/02/28 16838.09 17939.69
1994/03/31 16155.54 17209.19
1994/04/30 16246.51 17355.12
1994/05/31 16391.30 17505.59
1994/06/30 16306.51 17398.63
1994/07/31 16610.57 17717.55
1994/08/31 16669.65 17778.85
1994/09/30 16460.11 17517.86
1994/10/31 16234.96 17206.74
1994/11/30 15917.11 16895.64
1994/12/31 16229.43 17267.52
1995/01/31 16651.40 17761.02
1995/02/28 17048.51 18277.51
1995/03/31 17217.38 18487.52
1995/04/30 17220.99 18509.34
1995/05/31 17649.73 19099.97
1995/06/30 17559.53 18933.80
1995/07/31 17693.21 19113.29
1995/08/31 17939.24 19355.65
1995/09/30 18088.92 19478.17
1995/10/31 18297.28 19761.38
1995/11/30 18503.87 20089.22
1995/12/31 18638.38 20282.28
1996/01/31 18810.01 20435.41
1996/02/29 18749.81 20297.47
1996/03/31 18561.05 20038.07
1996/04/30 18524.63 19981.36
1996/05/31 18505.64 19973.37
1996/06/30 18660.85 20190.88
1996/07/31 18800.66 20374.62
1996/08/31 18803.35 20369.73
1996/09/30 18980.97 20654.90
1996/10/31 19201.36 20888.51
1996/11/30 19499.67 21270.77
1996/12/31 19464.97 21181.43
IMATRL PRASUN SHR__CHT 19961231 19970117 111242 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was
invested in Fidelity Limited Term Municipal Income Fund on December
31, 1986. As the chart shows, by December 31, 1996, the value of the
investment would have grown to $19,465 - a 94.65% increase on the
initial investment. For comparison, look at how the Lehman Brothers
Municipal Bond Index did over the same period. With dividends and
capital gains, if any, reinvested, the same $10,000 would have grown
to $21,181 - a 111.81% increase.
MARKET RECAP
Solid demand helped municipal
bonds perform better than their
investment-grade taxable
counterparts in 1996, even
though new issue supply saw one
of its strongest years ever. For the
year, the Lehman Brothers
Municipal Bond Index - a broad
measure of the municipal bond
market - had a total return of
4.43%. In comparison, the
Lehman Brothers Aggregate Bond
Index - a broad measure of the
performance of the U.S. taxable
bond market - had a total return
of 3.63%. Demand for munis
came from both insurance
companies and individual
investors. The diminishing
likelihood of significant tax reform
in the near future also helped
support the muni market. Like
most domestic bonds, munis
were affected by
stronger-than-expected signs of
strength in the economy early in
1996. Nevertheless, the market
conditions that supported the
muni market prevailed to the point
that munis entered the fall trading
at expensive levels relative to
their taxable counterparts. At that
point and through October, the
performance of the municipal
market stalled somewhat, as
investor demand declined and
institutional investors sold off
some of their municipal bond
holdings to take profits. That
sell-off subsided somewhat in
November and December, when
munis outperformed comparable
Treasury securities. However,
even though demand helped
buoy munis somewhat in
December, munis were caught in
the overall bond market
downdraft caused by conflicting
economic data and renewed
fears that inflation might lead the
Federal Reserve Board to raise
short-term interest rates.
An interview with David Murphy, Portfolio Manager of Fidelity Limited
Term Municipal Income Fund
Q. DAVE, HOW HAS THE FUND PERFORMED OVER THE PAST YEAR?
A. Reasonably well. For the 12 months that ended December 31, 1996,
the fund had a return of 4.43%. To get a sense of how the fund did
relative to its peers, the intermediate municipal debt funds average
returned 3.70% for the same period, according to Lipper Analytical
Services. The Lehman Brothers 1-17 Year Municipal Bond Index, which
tracks the types of securities in which the fund invests, had a
12-month return of 4.45% as of December 31.
Q. WHAT STRATEGIES DID YOU EMPLOY?
A. I used three primary strategies over the course of the year. First,
I matched the fund's duration - its sensitivity to interest rate
movements - to that of its benchmark. So, even though there was a fair
amount of interest rate volatility in the municipal market, I avoided
getting whipsawed by becoming bullish or bearish at the wrong time.
Second, in the beginning of the year I emphasized bonds in the
five-to-10 year maturity range. In the latter part of the year, I
reduced the five-to-10 year weighting in favor of the 10-20 year
range, which had become more attractive from a yield perspective.
Q. WHAT WAS THE THIRD STRATEGY?
A. The third strategy was to use a barbelled coupon structure-that is,
owning premium-coupon bonds as well as discount-coupon bonds.
Historically, premium-coupon bonds, which pay higher annual income
than newly-issued bonds, offer better downside protection should the
market fall. Discount-coupon bonds, which offer annual income below
newly-issued bonds, offer price appreciation potential should the
market rally. Over the entire period, as either of these types of
bonds moved closer to par (face value), I attempted to sell them and
replace them with similar premium or discount bonds.
Q. WHAT OTHER CHANGES DID YOU MAKE IN THE PORTFOLIO?
A. In addition to the change in maturity structure that I described
above, I reduced the fund's exposure to BBB-rated bonds somewhat.
Yield spreads between BBB-rated bonds and AAA-rated bonds became too
narrow for the additional risk we were taking on, so I began to sell
some of the fund's BBB holdings.
Q. DID YOU FOCUS ON ANY PARTICULAR STATES?
A. I emphasized bonds from California, which generally performed well
during the period. While the rest of the country has enjoyed an
economic expansion for the past six years, this state just emerged
from a prolonged economic downturn two years ago. Since then, even the
hardest hit areas - Southern California, for instance - have shown
employment growth, and the state's unemployment is at a six-year low.
Additionally, in the first four months of the state's current fiscal
year, the Golden State's tax revenues are $600 million ahead of
budget.
Q. DID YOU CONCENTRATE ON ANY OTHER SEGMENTS OF THE MARKET?
A. It really wasn't an environment conducive to making specific sector
plays. Relative to the index, I still have an overweighting in student
loan, hospital and electric utility bonds. Transportation-related
issues are slightly underweighted. One area that was interesting was
industrial development revenue bonds. These bonds are issued as
tax-exempt debt, but they're actually backed by an underlying,
taxpaying corporate entity. With the economy performing as well as it
has, these companies and their respective debt issuance performed
well.
Q. WHICH INDIVIDUAL POSITIONS MADE SIGNIFICANT CONTRIBUTIONS TO
PERFORMANCE?
A. When adhering to a duration-neutral strategy such as I am - that
is, I'm not making interest rate bets - it can be misleading to
pinpoint individual issues as being poor or top performers. If rates
fall, our long-duration bonds will perform best; if rates rise,
shorter-term securities will perform better. That being said, the
hospital sector, New York City general obligation bonds and student
loan revenue bond positions did well, mainly because they are
shorter-term instruments.
Q. WHAT'S YOUR OUTLOOK?
A. We're in the midst of a long-term, downward trend in inflation, and
municipal finances are as healthy as we've seen in a while. Going
forward, municipal bond investors will be monitoring the effects of
welfare reform and other government proposals on states and local
municipalities. While these changes would shift more responsibility to
the local levels and result in states receiving more federal funding,
the pressure to operate these programs efficiently would also rise.
I'll be watching closely to see how states cope with these changes in
order to move the fund's investments into states that are successfully
managing these changes.
DAVE MURPHY ON THE
PROLIFERATION OF MUNICIPAL
BOND INSURANCE:
"BOND INSURANCE HAS BECOME
A MAJOR DRIVER OF YIELD SPREADS
WITHIN THE MUNICIPAL MARKET. IN
FACT, THE AMOUNT OF DEBT
ISSUANCE THAT COMES TO MARKET
WITH INSURANCE HAS SOARED FROM
AROUND 30% A COUPLE YEARS AGO
TO ALMOST 50% TODAY. BOND
INSURANCE GUARANTEES THE
PAYMENT OF PRINCIPAL AND
INTEREST ON THE BOND, ALTHOUGH
IT'S IMPORTANT TO POINT OUT THE
INSURANCE DOES NOT GUARANTEE
AGAINST PRICE LOSSES. BOND
INSURANCE APPEALS TO ISSUERS
BECAUSE THEY CAN BRING THEIR
DEBT TO THE MARKET WITH HIGHER
RATINGS AND, THUS, LOWER
YIELDS. THE MUNICIPAL MARKET
IS BASICALLY DRIVEN BY RETAIL
INVESTORS WHO DON'T HAVE
EITHER THE TIME OR RESOURCES TO
RESEARCH AN ISSUER'S CREDIT
FUNDAMENTALS. IN THIS SENSE,
INVESTORS REGARD INSURANCE AS
A SORT OF COMFORT BUFFER. THEY
KNOW THAT IF THE ISSUER GETS
INTO TROUBLE, AN INSURANCE
COMPANY WILL BE RIGHT THERE TO
STEP IN. I DO BUY INSURED
PAPER, BUT I PREFER UNINSURED
BONDS. I'D JUST AS SOON SEEK
THE HIGHER INCOME FROM
NON-INSURED BONDS AND HAVE
OUR TALENTED CREDIT RESEARCH
TEAM COME TO ITS OWN
CONCLUSIONS REGARDING
CREDITWORTHINESS."
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT DATED
DECEMBER 31, 1996. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY
TIME BASED ON MARKET AND OTHER CONDITIONS.
EXHIBIT 1
FORM OF
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the Agreement) is made as
of December 22, 1997, by and between Fidelity Union Street Trust, a
Massachusetts business trust, on behalf of its series Spartan
Intermediate Municipal Income Fund (Spartan Intermediate) and Fidelity
School Street Trust, a Massachusetts business trust, on behalf of its
series Fidelity Limited Term Municipal Income Fund (Fidelity Limited
Term). Fidelity Union Street Trust and Fidelity School Street Trust
may be referred to herein collectively as the "Trusts" or each
individually as a "Trust." The trusts are duly organized business
trusts under the laws of the Commonwealth of Massachusetts with their
principal place of business at 82 Devonshire Street, Boston,
Massachusetts 02109. Spartan Intermediate and Fidelity Limited Term
may be referred to herein collectively as the "Funds" or each
individually as the "Fund."
This Agreement is intended to be, and is adopted as, a plan of
reorganization within the meaning of Section 368(a)(1)(C) of the
Internal Revenue Code of 1986, as amended (the Code). The
reorganization will comprise: (a) the transfer of all of the assets of
Spartan Intermediate to Fidelity Limited Term solely in exchange for
shares of beneficial interest in Fidelity Limited Term (the Fidelity
Limited Term Shares) and the assumption by Fidelity Limited Term of
Spartan Intermediate's liabilities; and (b) the constructive
distribution of such shares by Spartan Intermediate PRO RATA to its
shareholders in complete liquidation and termination of Spartan
Intermediate in exchange for all of Spartan Intermediate's outstanding
shares. Spartan Intermediate shall receive shares of Fidelity Limited
Term having an aggregate net asset value equal to the value of the
assets of Spartan Intermediate on the Closing Date (defined in Section
6), which Spartan Intermediate shall then distribute PRO RATA to its
shareholders. The foregoing transactions are referred to herein as the
"Reorganization."
In consideration of the mutual promises and subject to the terms and
conditions herein, the parties covenant and agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF SPARTAN INTERMEDIATE. Spartan
Intermediate represents and warrants to and agrees with Fidelity
Limited Term that:
(a) Spartan Intermediate is a series of Fidelity Union Street Trust, a
business trust duly organized, validly existing, and in good standing
under the laws of the Commonwealth of Massachusetts, and has the power
to own all of its properties and assets and to carry out its
obligations under this Agreement. It has all necessary federal, state,
and local authorizations to carry on its business as now being
conducted and to carry out this Agreement;
(b) Fidelity Union Street Trust is an open-end, management investment
company duly registered under the Investment Company Act of 1940, as
amended (the 1940 Act), and such registration is in full force and
effect;
(c) The Prospectus and Statement of Additional Information of Spartan
Intermediate (both dated October 21, 1997), previously furnished to
Fidelity Limited Term, did not and do not contain any untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading;
(d) There are no material legal, administrative, or other proceedings
pending or, to the knowledge of Spartan Intermediate, threatened
against Spartan Intermediate which assert liability on the part of
Spartan Intermediate. Spartan Intermediate knows of no facts which
might form the basis for the institution of such proceedings;
(e) Spartan Intermediate is not in, and the execution, delivery, and
performance of this Agreement will not result in, violation of any
provision of its Amended and Restated Declaration of Trust or By-laws,
or, to the knowledge of Spartan Intermediate, of any agreement,
indenture, instrument, contract, lease, or other undertaking to which
Spartan Intermediate is a party or by which Spartan Intermediate is
bound or result in the acceleration of any obligation or the
imposition of any penalty under any agreement, judgment or decree to
which Spartan Intermediate is a party or is bound;
(f) The Statement of Assets and Liabilities, the Statement of
Operations, the Statement of Changes in Net Assets, Financial
Highlights, and the Schedule of Investments (including market values)
of Spartan Intermediate at August 31, 1997, have been audited by
Coopers & Lybrand L.L.P., independent accountants, and have been
furnished to Fidelity Limited Term. Said Statement of Assets and
Liabilities and Schedule of Investments fairly present the Fund's
financial position as of such date and said Statement of Operations,
Statement of Changes in Net Assets, and Financial Highlights fairly
reflect its results of operations, changes in financial position, and
financial highlights for the periods covered thereby in conformity
with generally accepted accounting principles consistently applied;
(g) Spartan Intermediate has no known liabilities of a material
nature, contingent or otherwise, other than those shown as belonging
to it on its statement of assets and liabilities as of August 31, 1997
and those incurred in the ordinary course of Spartan Intermediate's
business as an investment company since August 31, 1997;
(h) The registration statement (Registration Statement) filed with the
Securities and Exchange Commission (Commission) by Fidelity School
Street Trust on Form N-14 relating to the shares of Fidelity Limited
Term issuable hereunder and the proxy statement of Spartan
Intermediate included therein (Proxy Statement), on the effective date
of the Registration Statement and insofar as they relate to Spartan
Intermediate (i) comply in all material respects with the provisions
of the Securities Act of 1933, as amended (the 1933 Act), the
Securities Exchange Act of 1934, as amended (the 1934 Act), and the
1940 Act, and the rules and regulations thereunder, and (ii) do not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and at the time of the
shareholders' meeting referred to in Section 7 and on the Closing
Date, the prospectus contained in the Registration Statement of which
the Proxy Statement is a part (the Prospectus), as amended or
supplemented, insofar as it relates to Spartan Intermediate, does not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading;
(i) All material contracts and commitments of Spartan Intermediate
(other than this Agreement) will be terminated without liability to
Spartan Intermediate prior to the Closing Date (other than those made
in connection with redemptions of shares and the purchase and sale of
portfolio securities made in the ordinary course of business);
(j) No consent, approval, authorization, or order of any court or
governmental authority is required for the consummation by Spartan
Intermediate of the transactions contemplated by this Agreement,
except such as have been obtained under the 1933 Act, the 1934 Act,
the 1940 Act, and state securities or blue sky laws (which term as
used herein shall include the District of Columbia and Puerto Rico);
(k) Spartan Intermediate has filed or will file all federal and state
tax returns which, to the knowledge of Spartan Intermediate's
officers, are required to be filed by Spartan Intermediate and has
paid or will pay all federal and state taxes shown to be due on said
returns or provision shall have been made for the payment thereof,
and, to the best of Spartan Intermediate's knowledge, no such return
is currently under audit and no assessment has been asserted with
respect to such returns;
(l) Spartan Intermediate has met the requirements of Subchapter M of
the Code for qualification and treatment as a regulated investment
company for all prior taxable years and intends to meet such
requirements for its current taxable year ending on the Closing Date;
(m) All of the issued and outstanding shares of Spartan Intermediate
are, and at the Closing Date will be, duly and validly issued and
outstanding and fully paid and nonassessable as a matter of
Massachusetts law (except as disclosed in the Fund's Statement of
Additional Information), and have been offered for sale and in
conformity with all applicable federal securities laws. All of the
issued and outstanding shares of Spartan Intermediate will, at the
Closing Date, be held by the persons and in the amounts set forth in
the list of shareholders submitted to Fidelity Limited Term in
accordance with this Agreement;
(n) As of both the Valuation Time (as defined in Section 4) and the
Closing Date, Spartan Intermediate will have the full right, power,
and authority to sell, assign, transfer, and deliver its portfolio
securities and any other assets of Spartan Intermediate to be
transferred to Fidelity Limited Term pursuant to this Agreement. At
the Closing Date, subject only to the delivery of Spartan
Intermediate's portfolio securities and any such other assets as
contemplated by this Agreement, Fidelity Limited Term will acquire
Spartan Intermediate's portfolio securities and any such other assets
subject to no encumbrances, liens, or security interests (except for
those that may arise in the ordinary course and are disclosed to
Fidelity Limited Term) and without any restrictions upon the transfer
thereof; and
(o) The execution, performance, and delivery of this Agreement will
have been duly authorized prior to the Closing Date by all necessary
corporate action on the part of Spartan Intermediate, and this
Agreement constitutes a valid and binding obligation of Spartan
Intermediate enforceable in accordance with its terms, subject to
shareholder approval.
2. REPRESENTATIONS AND WARRANTIES OF FIDELITY LIMITED TERM. Fidelity
Limited Term represents and warrants to and agrees with Spartan
Intermediate that:
(a) Fidelity Limited Term is a series of Fidelity School Street Trust,
a business trust duly organized, validly existing, and in good
standing under the laws of the Commonwealth of Massachusetts, and has
the power to own all of its properties and assets and to carry out its
obligations under this Agreement. It has all necessary federal, state,
and local authorizations to carry on its business as now being
conducted and to carry out this Agreement;
(b) Fidelity School Street Trust is an open-end, management investment
company duly registered under the 1940 Act, and such registration is
in full force and effect;
(c) The Prospectus and Statement of Additional Information of Fidelity
Limited Term (both dated February 28, 1997 with a Prospectus
supplement dated August 29, 1997), previously furnished to Spartan
Intermediate did not and do not contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
(d) There are no material legal, administrative, or other proceedings
pending or, to the knowledge of Fidelity Limited Term, threatened
against Fidelity Limited Term which assert liability on the part of
Fidelity Limited Term. Fidelity Limited Term knows of no facts which
might form the basis for the institution of such proceedings;
(e) Fidelity Limited Term is not in, and the execution, delivery, and
performance of this Agreement will not result in, violation of any
provision of its Amended and Restated Declaration of Trust or By-laws,
or, to the knowledge of Fidelity Limited Term, of any agreement,
indenture, instrument, contract, lease, or other undertaking to which
Fidelity Limited Term is a party or by which Fidelity Limited Term is
bound or result in the acceleration of any obligation or the
imposition of any penalty under any agreement, judgment, or decree to
which Fidelity Limited Term is a party or is bound;
(f) The Statement of Assets and Liabilities, the Statement of
Operations, the Statement of Changes in Net Assets, Financial
Highlights, and the Schedule of Investments (including market values)
of Fidelity Limited Term at December 31, 1996, have been audited by
Coopers & Lybrand L.L.P., independent accountants, and have been
furnished to Spartan Intermediate together with such unaudited
financial statements and schedule of investments (including market
values) for the six month period ended June 30, 1997. Said Statement
of Assets and Liabilities and Schedule of Investments fairly present
its financial position as of such date and said Statement of
Operations, Statement of Changes in Net Assets, and Financial
Highlights fairly reflect its results of operations, changes in
financial position, and financial highlights for the periods covered
thereby in conformity with generally accepted accounting principles
consistently applied;
(g) Fidelity Limited Term has no known liabilities of a material
nature, contingent or otherwise, other than those shown as belonging
to it on its statement of assets and liabilities as of December 31,
1996 and those incurred in the ordinary course of Fidelity Limited
Term's business as an investment company since December 31, 1996;
(h) No consent, approval, authorization, or order of any court or
governmental authority is required for the consummation by Fidelity
Limited Term of the transactions contemplated by this Agreement,
except such as have been obtained under the 1933 Act, the 1934 Act,
the 1940 Act, and state securities or blue sky laws (which term as
used herein shall include the District of Columbia and Puerto Rico);
(i) Fidelity Limited Term has filed or will file all federal and state
tax returns which, to the knowledge of Fidelity Limited Term's
officers, are required to be filed by Fidelity Limited Term and has
paid or will pay all federal and state taxes shown to be due on said
returns or provision shall have been made for the payment thereof,
and, to the best of Fidelity Limited Term's knowledge, no such return
is currently under audit and no assessment has been asserted with
respect to such returns;
(j) Fidelity Limited Term has met the requirements of Subchapter M of
the Code for qualification and treatment as a regulated investment
company for all prior taxable years and intends to meet such
requirements for its current taxable year ending on December 31, 1997;
(k) As of the Closing Date, the shares of beneficial interest of
Fidelity Limited Term to be issued to Spartan Intermediate will have
been duly authorized and, when issued and delivered pursuant to this
Agreement, will be legally and validly issued and will be fully paid
and nonassessable (except as disclosed in the Fund's Statement of
Additional Information) by Fidelity Limited Term, and no shareholder
of Fidelity Limited Term will have any preemptive right of
subscription or purchase in respect thereof;
(l) The execution, performance, and delivery of this Agreement will
have been duly authorized prior to the Closing Date by all necessary
corporate action on the part of Fidelity Limited Term, and this
Agreement constitutes a valid and binding obligation of Fidelity
Limited Term enforceable in accordance with its terms, subject to
approval by the shareholders of Spartan Intermediate;
(m) The Registration Statement and the Proxy Statement, on the
effective date of the Registration Statement and insofar as they
relate to Fidelity Limited Term, (i) will comply in all material
respects with the provisions of the 1933 Act, the 1934 Act, and the
1940 Act, and the rules and regulations thereunder, and (ii) will not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and at the time of the
shareholders' meeting referred to in Section 7 and on the Closing
Date, the Prospectus, as amended or supplemented, insofar as it
relates to Fidelity Limited Term, will not contain any untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading;
(n) The issuance of the Fidelity Limited Term Shares pursuant to this
Agreement will be in compliance with all applicable federal securities
laws; and
(o) All of the issued and outstanding shares of beneficial interest of
Fidelity Limited Term have been offered for sale and sold in
conformity with the federal securities laws.
3. REORGANIZATION.
(a) Subject to the requisite approval of the shareholders of Spartan
Intermediate and to the other terms and conditions contained herein,
Spartan Intermediate agrees to assign, sell, convey, transfer, and
deliver to Fidelity Limited Term as of the Closing Date all of the
assets of Spartan Intermediate of every kind and nature existing on
the Closing Date. Fidelity Limited Term agrees in exchange therefor:
(i) to assume all of Spartan Intermediate's liabilities existing on or
after the Closing Date, whether or not determinable on the Closing
Date, and (ii) to issue and deliver to Spartan Intermediate the number
of full and fractional shares of Fidelity Limited Term having an
aggregate net asset value equal to the value of the assets of Spartan
Intermediate transferred hereunder, less the value of the liabilities
of Spartan Intermediate, determined as provided for under Section 4.
(b) The assets of Spartan Intermediate to be acquired by Fidelity
Limited Term shall include, without limitation, all cash, cash
equivalents, securities, receivables (including interest or dividends
receivables), claims, choses in action, and other property owned by
Spartan Intermediate, and any deferred or prepaid expenses shown as an
asset on the books of Spartan Intermediate on the Closing Date.
Spartan Intermediate will pay or cause to be paid to Fidelity Limited
Term any dividend or interest payments received by it on or after the
Closing Date with respect to the assets transferred to Fidelity
Limited Term hereunder, and Fidelity Limited Term will retain any
dividend or interest payments received by it after the Valuation Time
with respect to the assets transferred hereunder without regard to the
payment date thereof.
(c) The liabilities of Spartan Intermediate to be assumed by Fidelity
Limited Term shall include (except as otherwise provided for herein)
all of Spartan Intermediate's liabilities, debts, obligations, and
duties, of whatever kind or nature, whether absolute, accrued,
contingent, or otherwise, whether or not arising in the ordinary
course of business, whether or not determinable on the Closing Date,
and whether or not specifically referred to in this Agreement.
Notwithstanding the foregoing, Spartan Intermediate agrees to use its
best efforts to discharge all of its known liabilities prior to the
Closing Date, other than liabilities incurred in the ordinary course
of business.
(d) Pursuant to this Agreement, as soon after the Closing Date as is
conveniently practicable (the Liquidation Date), Spartan Intermediate
will constructively distribute PRO RATA to its shareholders of record,
determined as of the Valuation Time on the Closing Date, the Fidelity
Limited Term Shares in exchange for such shareholders' shares of
beneficial interest in Spartan Intermediate and Spartan Intermediate
will be liquidated in accordance with Spartan Intermediate's Amended
and Restated Declaration of Trust. Such distribution shall be
accomplished by the Funds' transfer agent opening accounts on Fidelity
Limited Term's share transfer books in the names of the Spartan
Intermediate shareholders and transferring the Fidelity Limited Term
Shares thereto. Each Spartan Intermediate shareholder's account shall
be credited with the respective PRO RATA number of full and fractional
(rounded to the third decimal place) Fidelity Limited Term Shares due
that shareholder. All outstanding Spartan Intermediate shares,
including any represented by certificates, shall simultaneously be
canceled on Spartan Intermediate's share transfer records. Fidelity
Limited Term shall not issue certificates representing the Fidelity
Limited Term Shares in connection with the Reorganization.
(e) Any reporting responsibility of Spartan Intermediate is and shall
remain its responsibility up to and including the date on which it is
terminated.
(f) Any transfer taxes payable upon issuance of the Fidelity Limited
Term Shares in a name other than that of the registered holder on
Spartan Intermediate's books of the Spartan Intermediate shares
constructively exchanged for the Fidelity Limited Term Shares shall be
paid by the person to whom such Fidelity Limited Term Shares are to be
issued, as a condition of such transfer.
4. VALUATION.
(a) The Valuation Time shall be 4:00 p.m. Eastern time on the Closing
Date, or such other date as may be mutually agreed upon in writing by
the parties hereto (the Valuation Time).
(b) As of the Closing Date, Fidelity Limited Term will deliver to
Spartan Intermediate the number of Fidelity Limited Term Shares having
an aggregate net asset value equal to the value of the assets of
Spartan Intermediate transferred hereunder less the liabilities of
Spartan Intermediate, determined as provided in this Section 4.
(c) The net asset value per share of the Fidelity Limited Term Shares
to be delivered to Spartan Intermediate, the value of the assets of
Spartan Intermediate transferred hereunder, and the value of the
liabilities of Spartan Intermediate to be assumed hereunder shall in
each case be determined as of the Valuation Time.
(d) The net asset value per share of the Fidelity Limited Term Shares
shall be computed in the manner set forth in the then-current Fidelity
Limited Term Prospectus and Statement of Additional Information, and
the value of the assets and liabilities of Spartan Intermediate shall
be computed in the manner set forth in the then-current Spartan
Intermediate Prospectus and Statement of Additional Information.
(e) All computations pursuant to this Section shall be made by or
under the direction of Fidelity Service Company, Inc., a wholly-owned
subsidiary of FMR Corp., in accordance with its regular practice as
pricing agent for Spartan Intermediate and Fidelity Limited Term.
5. FEES; EXPENSES.
(a) Pursuant to Spartan Intermediate's all-inclusive management
contract with Fidelity Management & Research Company (FMR), FMR will
pay all fees and expenses, including legal, accounting, printing,
filing, and proxy solicitation expenses, portfolio transfer taxes (if
any), or other similar expenses incurred in connection with the
transactions contemplated by this Agreement (but not including costs
incurred in connection with the purchase or sale of portfolio
securities). Any expenses associated with the Reorganization which may
be attributable to Fidelity Limited Term will be borne by Fidelity
Limited Term, provided that they do not exceed the fund's 0.55%
expense cap in effect since April 1, 1997 (but not including costs
incurred with the purchase or sale of portfolio securities).
(b) Each of Fidelity Limited Term and Spartan Intermediate represents
that there is no person who has dealt with it who by reason of such
dealings is entitled to any broker's or finder's or other similar fee
or commission arising out of the transactions contemplated by this
Agreement.
6. CLOSING DATE.
(a) The Reorganization, together with related acts necessary to
consummate the same (the Closing), unless otherwise provided herein,
shall occur at the principal office of the Trusts, 82 Devonshire
Street, Boston, Massachusetts, as of the Valuation Time on February
26, 1998, or at some other time, date, and place agreed to by Spartan
Intermediate and Fidelity Limited Term (the Closing Date).
(b) In the event that on the Closing Date: (i) any of the markets for
securities held by the Funds is closed to trading, or (ii) trading
thereon is restricted, or (iii) trading or the reporting of trading on
said market or elsewhere is disrupted, all so that accurate appraisal
of the total net asset value of Spartan Intermediate and the net asset
value per share of Fidelity Limited Term is impracticable, the
Valuation Time and the Closing Date shall be postponed until the first
business day after the day when such trading shall have been fully
resumed and such reporting shall have been restored, or such other
date as the parties may agree.
7. SHAREHOLDER MEETING AND TERMINATION OF SPARTAN INTERMEDIATE.
(a) Spartan Intermediate agrees to call a meeting of its shareholders
after the effective date of the Registration Statement, to consider
transferring its assets to Fidelity Limited Term as herein provided,
adopting this Agreement, and authorizing the liquidation of Spartan
Intermediate.
(b) Spartan Intermediate agrees that as soon as reasonably practicable
after distribution of the Fidelity Limited Term Shares, Spartan
Intermediate shall be terminated as a series of Fidelity Union Street
Trust pursuant to its Amended and Restated Declaration of Trust, any
further actions shall be taken in connection therewith as required by
applicable law, and on and after the Closing Date Spartan Intermediate
shall not conduct any business except in connection with its
liquidation and termination.
8. CONDITIONS TO OBLIGATIONS OF FIDELITY LIMITED TERM.
(a) That Spartan Intermediate furnishes to Fidelity Limited Term a
statement, dated as of the Closing Date, signed by an officer of
Fidelity Union Street Trust, certifying that as of the Valuation Time
and the Closing Date all representations and warranties of Spartan
Intermediate made in this Agreement are true and correct in all
material respects and that Spartan Intermediate has complied with all
the agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to such dates;
(b) That Spartan Intermediate furnishes Fidelity Limited Term with
copies of the resolutions, certified by an officer of Fidelity Union
Street Trust, evidencing the adoption of this Agreement and the
approval of the transactions contemplated herein by the requisite vote
of the holders of the outstanding shares of beneficial interest of
Spartan Intermediate;
(c) That, on or prior to the Closing Date, Spartan Intermediate will
declare one or more dividends or distributions which, together with
all previous such dividends or distributions attributable to its
current taxable year, shall have the effect of distributing to the
shareholders of Spartan Intermediate substantially all of Spartan
Intermediate's investment company taxable income and all of its net
realized capital gain, if any, as of the Closing Date;
(d) That Spartan Intermediate shall deliver to Fidelity Limited Term
at the Closing a statement of its assets and liabilities, together
with a list of its portfolio securities showing each such security's
adjusted tax basis and holding period by lot, with values determined
as provided in Section 4 of this Agreement, all as of the Valuation
Time, certified on Spartan Intermediate's behalf by its Treasurer or
Assistant Treasurer;
(e) That Spartan Intermediate's custodian shall deliver to Fidelity
Limited Term a certificate identifying the assets of Spartan
Intermediate held by such custodian as of the Valuation Time on the
Closing Date and stating that as of the Valuation Time: (i) the
assets held by the custodian will be transferred to Fidelity Limited
Term; (ii) Spartan Intermediate's assets have been duly endorsed in
proper form for transfer in such condition as to constitute good
delivery thereof; and (iii) to the best of the custodian's knowledge,
all necessary taxes in conjunction with the delivery of the assets,
including all applicable federal and state stock transfer stamps, if
any, have been paid or provision for payment has been made;
(f) That Spartan Intermediate's transfer agent shall deliver to
Fidelity Limited Term at the Closing a certificate setting forth the
number of shares of Spartan Intermediate outstanding as of the
Valuation Time and the name and address of each holder of record of
any such shares and the number of shares held of record by each such
shareholder;
(g) That Spartan Intermediate calls a meeting of its shareholders to
be held after the effective date of the Registration Statement, to
consider transferring its assets to Fidelity Limited Term as herein
provided, adopting this Agreement, and authorizing the liquidation and
termination of Spartan Intermediate;
(h) That Spartan Intermediate delivers to Fidelity Limited Term a
certificate of an officer of Fidelity Union Street Trust, dated as of
the Closing Date, that there has been no material adverse change in
Spartan Intermediate's financial position since August 31, 1997, other
than changes in the market value of its portfolio securities, or
changes due to net redemptions of its shares, dividends paid, or
losses from operations; and
(i) That all of the issued and outstanding shares of beneficial
interest of Spartan Intermediate shall have been offered for sale and
sold in conformity with all applicable state securities laws and, to
the extent that any audit of the records of Spartan Intermediate or
its transfer agent by Fidelity Limited Term or its agents shall have
revealed otherwise, Spartan Intermediate shall have taken all actions
that in the opinion of Fidelity Limited Term are necessary to remedy
any prior failure on the part of Spartan Intermediate to have offered
for sale and sold such shares in conformity with such laws.
9. CONDITIONS TO OBLIGATIONS OF SPARTAN INTERMEDIATE.
(a) That Fidelity Limited Term shall have executed and delivered to
Spartan Intermediate an Assumption of Liabilities, certified by an
officer of Fidelity School Street Trust, dated as of the Closing Date
pursuant to which Fidelity Limited Term will assume all of the
liabilities of Spartan Intermediate existing at the Valuation Time in
connection with the transactions contemplated by this Agreement;
(b) That Fidelity Limited Term furnishes to Spartan Intermediate a
statement, dated as of the Closing Date, signed by an officer of
Fidelity School Street Trust, certifying that as of the Valuation Time
and the Closing Date all representations and warranties of Fidelity
Limited Term made in this Agreement are true and correct in all
material respects, and Fidelity Limited Term has complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to such dates; and
(c) That Spartan Intermediate shall have received an opinion of
Kirkpatrick & Lockhart LLP, counsel to Spartan Intermediate and
Fidelity Limited Term, to the effect that the Fidelity Limited Term
Shares are duly authorized and upon delivery to Spartan Intermediate
as provided in this Agreement will be validly issued and will be fully
paid and nonassessable by Fidelity Limited Term (except as disclosed
in Spartan Intermediate's Statement of Additional Information) and no
shareholder of Fidelity Limited Term has any preemptive right of
subscription or purchase in respect thereof.
10. CONDITIONS TO OBLIGATIONS OF FIDELITY LIMITED TERM AND SPARTAN
INTERMEDIATE.
(a) That this Agreement shall have been adopted and the transactions
contemplated herein shall have been approved by the requisite vote of
the holders of the outstanding shares of beneficial interest of
Spartan Intermediate;
(b) That all consents of other parties and all other consents, orders,
and permits of federal, state, and local regulatory authorities
(including those of the Commission and of state Blue Sky and
securities authorities, including "no action" positions of such
federal or state authorities) deemed necessary by Fidelity Limited
Term or Spartan Intermediate to permit consummation, in all material
respects, of the transactions contemplated hereby shall have been
obtained, except where failure to obtain any such consent, order, or
permit would not involve a risk of a material adverse effect on the
assets or properties of Fidelity Limited Term or Spartan Intermediate,
provided that either party hereto may for itself waive any of such
conditions;
(c) That all proceedings taken by either Fund in connection with the
transactions contemplated by this Agreement and all documents
incidental thereto shall be satisfactory in form and substance to it
and its counsel, Kirkpatrick & Lockhart LLP;
(d) That there shall not be any material litigation pending with
respect to the matters contemplated by this Agreement;
(e) That the Registration Statement shall have become effective under
the 1933 Act, and no stop order suspending such effectiveness shall
have been instituted or, to the knowledge of Fidelity Limited Term and
Spartan Intermediate, threatened by the Commission; and
(f) That Fidelity Limited Term and Spartan Intermediate shall have
received an opinion of Kirkpatrick & Lockhart LLP satisfactory to
Fidelity Limited Term and Spartan Intermediate that for federal income
tax purposes:
(i) The Reorganization will be a reorganization under section
368(a)(1)(C) of the Code, and Spartan Intermediate and Fidelity
Limited Term will each be parties to the Reorganization under section
368(b) of the Code;
(ii) No gain or loss will be recognized by Spartan Intermediate upon
the transfer of all of its assets to Fidelity Limited Term in exchange
solely for the Fidelity Limited Term Shares and the assumption of
Spartan Intermediate's liabilities followed by the distribution of
those Fidelity Limited Term Shares to the shareholders of Spartan
Intermediate in liquidation of Spartan Intermediate;
(iii) No gain or loss will be recognized by Fidelity Limited Term on
the receipt of Spartan Intermediate's assets in exchange solely for
the Fidelity Limited Term Shares and the assumption of Spartan
Intermediate's liabilities;
(iv) The basis of Spartan Intermediate's assets in the hands of
Fidelity Limited Term will be the same as the basis of such assets in
Spartan Intermediate's hands immediately prior to the Reorganization;
(v) Fidelity Limited Term's holding period in the assets to be
received from Spartan Intermediate will include Spartan Intermediate's
holding period in such assets;
(vi) A Spartan Intermediate shareholder will recognize no gain or
loss on the exchange of his or her shares of beneficial interest in
Spartan Intermediate for the Fidelity Limited Term Shares in the
Reorganization;
(vii) A Spartan Intermediate shareholder's basis in the Fidelity
Limited Term Shares to be received by him or her will be the same as
his or her basis in the Spartan Intermediate shares exchanged
therefor;
(viii) A Spartan Intermediate shareholder's holding period for his
or her Fidelity Limited Term Shares will include the holding period of
Spartan Intermediate shares exchanged, provided that those Spartan
Intermediate shares were held as capital assets on the date of the
Reorganization.
Notwithstanding anything herein to the contrary, each of Spartan
Intermediate and Fidelity Limited Term may not waive the conditions
set forth in this subsection 10(f).
11. COVENANTS OF FIDELITY LIMITED TERM AND SPARTAN INTERMEDIATE.
(a) Fidelity Limited Term and Spartan Intermediate each covenants to
operate its respective business in the ordinary course between the
date hereof and the Closing Date, it being understood that such
ordinary course of business will include the payment of customary
dividends and distributions;
(b) Spartan Intermediate covenants that it is not acquiring the
Fidelity Limited Term Shares for the purpose of making any
distribution other than in accordance with the terms of this
Agreement;
(c) Spartan Intermediate covenants that it will assist Fidelity
Limited Term in obtaining such information as Fidelity Limited Term
reasonably requests concerning the beneficial ownership of Spartan
Intermediate's shares; and
(d) Spartan Intermediate covenants that its liquidation and
termination will be effected in the manner provided in its Amended and
Restated Declaration of Trust in accordance with applicable law and
after the Closing Date, Spartan Intermediate will not conduct any
business except in connection with its liquidation and termination.
12. TERMINATION; WAIVER.
Fidelity Limited Term and Spartan Intermediate may terminate this
Agreement by mutual agreement. In addition, either Fidelity Limited
Term or Spartan Intermediate may at its option terminate this
Agreement at or prior to the Closing Date because:
(i) of a material breach by the other of any representation,
warranty, or agreement contained herein to be performed at or prior to
the Closing Date; or
(ii) a condition herein expressed to be precedent to the obligations
of the terminating party has not been met and it reasonably appears
that it will not or cannot be met.
In the event of any such termination, there shall be no liability for
damages on the part of Spartan Intermediate or Fidelity Limited Term,
or their respective Trustees or officers.
13. SOLE AGREEMENT; AMENDMENTS; WAIVERS; SURVIVAL OF WARRANTIES.
(a) This Agreement supersedes all previous correspondence and oral
communications between the parties regarding the subject matter
hereof, constitutes the only understanding with respect to such
subject matter, may not be changed except by a letter of agreement
signed by each party hereto and shall be construed in accordance with
and governed by the laws of the Commonwealth of Massachusetts.
(b) This Agreement may be amended, modified, or supplemented in such
manner as may be mutually agreed upon in writing by the respective
President, any Vice President, or Treasurer of Fidelity Limited Term
or Spartan Intermediate; provided, however, that following the
shareholders' meeting called by Spartan Intermediate pursuant to
Section 7 of this Agreement, no such amendment may have the effect of
changing the provisions for determining the number of Fidelity Limited
Term Shares to be paid to Spartan Intermediate shareholders under this
Agreement to the detriment of such shareholders without their further
approval.
(c) Either Fund may waive any condition to its obligations hereunder,
provided that such waiver does not have any material adverse effect on
the interests of such Fund's shareholders.
The representations, warranties, and covenants contained in the
Agreement, or in any document delivered pursuant hereto or in
connection herewith, shall survive the consummation of the
transactions contemplated hereunder.
14. DECLARATIONS OF TRUST.
A copy of each fund's Declaration of Trust, as restated and amended,
is on file with the Secretary of State of the Commonwealth of
Massachusetts, and notice is hereby given that this instrument is
executed on behalf of the Trustees of each Fund as trustees and not
individually and that the obligations of each fund under this
instrument are not binding upon any of such Fund's Trustees, officers,
or shareholders individually but are binding only upon the assets and
property of such Fund. Each Fund agrees that its obligations hereunder
apply only to such Fund and not to its shareholders individually or to
the Trustees of such Fund.
15. ASSIGNMENT.
This Agreement shall bind and inure to the benefit of the parties
hereto and their respective successors and assigns, but no assignment
or transfer of any rights or obligations hereunder shall be made by
any party without the written consent of the other parties. Nothing
herein expressed or implied is intended or shall be construed to
confer upon or give any person, firm, or corporation other than the
parties hereto and their respective successors and assigns any rights
or remedies under or by reason of this Agreement.
This Agreement may be executed in any number of counterparts, each of
which, when executed and delivered, shall be deemed to be an original.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed by an appropriate officer.
SIGNATURE LINES OMITTED
SUPPLEMENT TO THE FIDELITY LIMITED TERM MUNICIPAL INCOME FUND FEBRUARY
28, 1997 PROSPECTUS
Effective September 1, 1997, the following information replaces
similar information found in the "Key Facts" section on page 3:
STRATEGY: Invests normally in investment-grade municipal securities
while maintaining an average maturity of between three and 10 years.
Effective September 1, 1997, the following information replaces
similar information found in the "Investment Principles and Risks"
section beginning on page 9:
LIMITED TERM MUNICIPAL INCOME seeks high current income that is free
from federal income tax, consistent with preservation of capital, by
investing in investment-grade municipal securities under normal
conditions. The fund normally maintains a dollar-weighted average
maturity of between three and 10 years. FMR seeks to manage the fund
so that it generally reacts to changes in interest rates similarly to
municipal bonds with maturities of between seven and 10 years. As of
December 31, 1996, the fund's dollar-weighted average maturity was
approximately 8.3 years.
The following changes became effective April 1, 1997:
The minimum investments have been changed to the following:
TO OPEN AN ACCOUNT $10,000
TO ADD TO AN ACCOUNT $1,000
Through regular investment plans $500
MINIMUM BALANCE $5,000
The minimum check amount has been increased to $1,000.
References to the minimums throughout the prospectus are changed to
the above minimums.
The following information replaces similar information found in
"Expenses" on page 4:
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy
or sell shares of a fund. In addition, you may be charged an annual
account maintenance fee if your balance falls below $2,500. See
"Transaction Details," page 23, for an explanation of how and when
these charges apply.
Maximum sales charge on purchases None
and reinvested distributions
Deferred sales charge on redemptions None
Exchange Fee None
Annual account maintenance fee $12.00
(for accounts under $2,500)
ANNUAL FUND OPERATING EXPENSES are paid out of the fund's assets. The
fund pays a management fee to FMR. It also incurs other expenses for
services such as maintaining shareholder records and furnishing
shareholder statements and financial reports. The fund's expenses are
factored into its share price or dividends and are not charged
directly to shareholder accounts (see page 14).
The following figures are based on historical expenses, adjusted to
reflect current fees, and are calculated as a percentage of average
net assets.
Management fee (after reimbursement) .37%
12b-1 fee None
Other expenses .18%
Total fund operating expenses .55%
(after reimbursement)
EXAMPLES: Let's say, hypothetically, that the fund's annual return is
5% and that its operating expenses are exactly as just described. For
every $1,000 you invested, here's how much you would pay in total
expenses after the number of years indicated:
After 1 year $ 6
After 3 years $ 18
After 5 years $ 31
After 10 years $ 69
These examples illustrate the effect of expenses, but are not meant to
suggest actual or expected costs or returns, all of which may vary.
Effective April 1, 1997, FMR voluntarily agreed to implement an
expense cap. FMR will reimburse the fund to the extent that total
operating expenses exceeds .55%. If this agreement was not in effect,
the management fee and total operating expenses would be .38% and
.56%, respectively.
Please read this prospectus before investing, and keep it on file for
future reference. It contains important information, including how the
fund invests and the services available to shareholders.
To learn more about the fund and its investments, you can obtain a
copy of the fund's most recent financial report and portfolio listing,
or a copy of the Statement of Additional Information (SAI) dated
February 24, 1997. The SAI has been filed with the Securities and
Exchange Commission (SEC) and is available along with other related
materials on the SEC's Internet Web site (http://www.sec.gov). The SAI
is incorporated herein by reference (legally forms a part of the
prospectus). For a free copy of either document, call Fidelity at
1-800-544-8888.
Mutual fund shares are not deposits or obligations of, or guaranteed
by, any depository institution. Shares are not insured by the FDIC,
Federal Reserve Board, or any other agency, and are subject to
investment risks, including possible loss of principal amount
invested.
LIKE ALL MUTUAL FUNDS, THESE
SECURITIES HAVE NOT BEEN APPROVED
OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION, NOR
HAS THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
LIM -pro-0297
(fund number 036, trading symbol FLTMX)
The fund seeks a high level of current income free from federal income
tax. The fund invests normally in investment-grade municipal
securities while maintaining an average maturity of 12 years or less.
FIDELITY
LIMITED TERM
MUNICIPAL INCOME
FUND
PROSPECTUS
FEBRUARY 28, 1997(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET,
BOSTON, MA 02109
CONTENTS
KEY FACTS THE FUND AT A GLANCE
WHO MAY WANT TO INVEST
EXPENSES The fund's yearly operating
expenses.
FINANCIAL HIGHLIGHTS A summary of the
fund's financial data.
PERFORMANCE How the fund has done
over time.
THE FUND IN DETAIL CHARTER How the fund is organized.
INVESTMENT PRINCIPLES AND RISKS The
fund's overall approach to investing.
BREAKDOWN OF EXPENSES How
operating costs are calculated and what
they include.
YOUR ACCOUNT DOING BUSINESS WITH FIDELITY
TYPES OF ACCOUNTS Different ways to
set up your account.
HOW TO BUY SHARES Opening an
account and making additional
investments.
HOW TO SELL SHARES Taking money out
and closing your account.
INVESTOR SERVICES Services to help you
manage your account.
SHAREHOLDER AND DIVIDENDS, CAPITAL GAINS,
ACCOUNT POLICIES AND TAXES
TRANSACTION DETAILS Share price
calculations and the timing of purchases
and redemptions.
EXCHANGE RESTRICTIONS
KEY FACTS
THE FUND AT A GLANCE
GOAL: High current income free from federal income tax with
preservation of capital. As with any mutual fund, there is no
assurance that the fund will achieve its goal.
STRATEGY: Invests normally in investment-grade municipal securities
while maintaining an average maturity of 12 years or less.
MANAGEMENT: Fidelity Management & Research Company (FMR) is the
management arm of Fidelity Investments, which was established in 1946
and is now America's largest mutual fund manager.
SIZE: As of December 31, 1996, the fund had over $ 903 million
in assets.
WHO MAY WANT TO INVEST
The fund may be appropriate for investors in higher tax brackets who
seek high current income that is free from federal income tax. The
fund's level of risk and potential reward depends on the quality and
maturity of its investments. You should consider your investment
objective and tolerance for risk when making an investment decision.
The value of the fund's investments and the income they generate will
vary from day to day, and generally reflect interest rates, market
conditions, and other economic and political news. When you sell your
shares, they may be worth more or less than what you paid for them. By
itself, the fund does not constitute a balanced investment plan.
THE SPECTRUM OF
FIDELITY FUNDS
BROAD CATEGORIES OF FIDELITY
FUNDS ARE PRESENTED HERE IN
ORDER OF ASCENDING RISK.
GENERALLY, INVESTORS SEEKING TO
MAXIMIZE RETURN MUST ASSUME
GREATER RISK. LIMITED TERM
MUNICIPAL INCOME IS IN THE
INCOME CATEGORY.
(SOLID BULLET) MONEY MARKET SEEKS
INCOME AND STABILITY BY
INVESTING IN HIGH-QUALITY,
SHORT-TERM INVESTMENTS.
(RIGHT ARROW) INCOME SEEKS INCOME BY
INVESTING IN BONDS.
(SOLID BULLET) GROWTH AND INCOME SEEKS
LONG-TERM GROWTH AND INCOME
BY INVESTING IN STOCKS AND
BONDS.
(SOLID BULLET) GROWTH SEEKS LONG-TERM
GROWTH BY INVESTING MAINLY IN
STOCKS.
(CHECKMARK)
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy
or sell shares of a fund. In addition, you may be charged an annual
account maintenance fee if your account balance falls below $2,500.
See "Transaction Details," page , for an explanation of how and when
these charges apply.
Maximum sales charge on purchases None
and reinvested distributions
Deferred sales charge on redemptions None
Exchange fee None
Annual account maintenance fee $12.00
(for accounts under $2,500)
ANNUAL FUND OPERATING EXPENSES are paid out of the fund's assets. The
fund pays a management fee to FMR. It also incurs other expenses for
services such as maintaining shareholder records and furnishing
shareholder statements and financial reports. The fund's expenses are
factored into its share price or dividends and are not charged
directly to shareholder accounts (see page ).
The following figures are based on historical expenses and are
calculated as a percentage of average net assets.
Management fee .38 %
12b-1 fee None
Other expenses .18 %
Total fund operating expenses .56 %
EXAMPLES: Let's say, hypothetically, that the fund's annual return is
5% and that its operating expenses are exactly as just described. For
every $1,000 you invested, here's how much you would pay in total
expenses if you close your account after the number of years
indicated:
After 1 year $ 6
After 3 years $ 18
After 5 years $ 31
After 10 years $ 70
These examples illustrate the effect of expenses, but are not meant to
suggest actual or expected costs or returns, all of which may vary.
UNDERSTANDING
EXPENSES
OPERATING A MUTUAL FUND
INVOLVES A VARIETY OF EXPENSES
FOR PORTFOLIO MANAGEMENT,
SHAREHOLDER STATEMENTS, TAX
REPORTING, AND OTHER SERVICES.
THESE COSTS ARE PAID FROM THE
FUND'S ASSETS; THEIR EFFECT IS
ALREADY FACTORED INTO ANY
QUOTED SHARE PRICE OR RETURN.
(CHECKMARK)
FINANCIAL HIGHLIGHTS
The financial highlights table that follows has been audited by
Coopers & Lybrand L.L.P., independent accountants. the fund's
financial highlights, financial statements, and report of the auditor
are included in the fund's Annual Report, and are incorporated by
reference into (are legally a part of) the fund's SAI. Contact
Fidelity for a free copy of the Annual Report or the SAI.
SELECTED PER-SHARE DATA
<ERROR: WIDE TABLE>
ERROR: The Following Table: "Assets" is Too Wide!
Table Width is 212 characters.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Years ended December
31 1996 1995 1994 1993A 1992 1991 1990 1989 1988 1987
Net asset
value, $ 9.800 $ 8.990 $ 9.990 $ 9.600 $ 9.520 $ 9.270 $ 9.310 $ 9.230 $ 9.100 $ 9.580
beginning of period
Income from Investment
Operations .488 .497 .512 .516 .573 .603 .615 .617 .600 .582
Net interest income
Net realized
and (.069) .810 (.980) .630 .180 .400 .010 .080 .130 (.480)
unrealized gain (loss)
Total from investment
operations .419 1.307 (.468) 1.146 .753 1.003 .625 .697 .730 .102
Less Distribu
tions (.488) (.497) (.512) (.516) (.573) (.603) (.615) (.617) (.600) (.582)
From net interest income
From net realized
gain (.031) -- (.010) (.220) (.100) (.150) (.050) -- -- ---
In excess of net realized
gain -- -- (.010) (.020) -- -- -- -- -- --
Total distribut
ions (.519) (.497) (.532) (.756) (.673) (.753) (.665) (.617) (.600) (.582)
Net asset value, end of
period $ 9.700 $ 9.800 $ 8.990 $ 9.990 $ 9.600 $ 9.520 $ 9.270 $ 9.310 $ 9.230 $ 9.100
Total
returnC 4.43% 14.84% (4.76)% 12.24% 8.17% 11.19% 6.97% 7.83% 8.22% 1.14%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of
period $ 904 $ 943 $ 878 $ 1,199 $ 976 $ 696 $ 468 $ 442 $ 441 $ 459
(In millions)
Ratio of expenses
to .56% .57% .56% .57% .64% .68% .67% .66%B .67% .74%
average net assets
Ratio of net interest income
to 5.06% 5.25% 5.42% 5.19% 5.94% 6.41% 6.63% 6.70% 6.51% 6.29%
average net assets
Portfolio turnover
rate 27% 31% 30% 111% 50% 42% 72% 55% 30% 59%
</TABLE>
A EFFECTIVE JANUARY 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION
93-2, "DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION
OF INCOME, CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY
INVESTMENT COMPANIES." AS A RESULT, NET INTEREST INCOME PER SHARE MAY
REFLECT CERTAIN RECLASSIFICATIONS RELATED TO BOOK TO TAX
DIFFERENCES.
B FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING
THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD
HAVE BEEN HIGHER.
C TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIOD SHOWN.
PERFORMANCE
Bond fund performance can be measured as TOTAL RETURN or YIELD. The
total returns that follow are based on historical fund results.
The fund's fiscal year runs from January 1 through December 31. The
tables below show the fund's performance over past fiscal years
compared to different measures, including a comparative index and a
competitive funds average. Data for the comparative index is available
only from June 30, 1993 to the present. The chart on page presents
calendar year performance.
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Fiscal periods ended Past 1 Past 5 Past 10
December 31, 1996 year years years
Limited Term Municipal Income 4.43 % 6.76 % 6.89 %
Lehman Bros. 1-17 Year Muni.
Bond Index 4.45 % n/a n/a
Lipper Intermediate Muni. Debt
Funds Avg. 3.70 % 6.11 % 6.63 %
CUMULATIVE TOTAL RETURNS
Fiscal periods ended Past 1 Past 5 Past 10
December 31, 1996 year years years
Limited Term Municipal Income 4.43 % 38.68 % 94.65 %
Lehman Bros. 1-17 Year Muni.
Bond Index 4.45 % n/a n/a
Lipper Intermediate Muni. Debt
Funds Avg. 3.70 % 34.55 % 90.15 %
</TABLE>
EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment over a given
period, assuming reinvestment of any dividends and capital gains. A
CUMULATIVE TOTAL RETURN reflects actual performance over a stated
period of time. An AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate
of return that, if achieved annually, would have produced the same
cumulative total return if performance had been constant over the
entire period. Average annual total returns smooth out variations in
performance; they are not the same as actual year-by-year results.
UNDERSTANDING
PERFORMANCE
YIELD illustrates the income
earned by a fund over a recent
period. 30-day yields are
usually used for bond funds.
Yields change daily, reflecting
changes in interest rates.
TOTAL RETURN reflects both the
reinvestment of income and
capital gain distributions and
any change in a fund's share
price.
(checkmark)
YIELD refers to the income generated by an investment in the fund over
a given period of time, expressed as an annual percentage rate. A
TAX-EQUIVALENT YIELD shows what an investor would have to earn before
taxes to equal a tax-free yield. Yields are calculated according to a
standard that is required for all stock and bond funds. Because this
differs from other accounting methods, the quoted yield may not equal
the income actually paid to shareholders.
THE LEHMAN BROTHERS 1-17 YEAR MUNICIPAL BOND INDEX is a total
return performance benchmark for investment-grade municipal bonds with
maturities between one and 17 years.
Unlike the fund's returns, the total returns of the comparative index
do not include the effect of any brokerage commissions, transaction
fees, or other costs of investing.
THE CONSUMER PRICE INDEX is a widely recognized measure of inflation
calculated by the U.S. Government.
THE COMPETITIVE FUNDS AVERAGE is the Lipper Intermediate Municipal
Debt Funds Average, which currently reflects the performance of
over 136 mutual funds with similar investment objectives. This
average, published by Lipper Analytical Services, Inc., excludes the
effect of sales charges.
YEAR-BY-YEAR TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Calendar years 19 87 1988 1989 1990 1991 1992 1993 1994 1995 1996
LIMITED TERM MUNICIPAL 1.14% 8.22% 7.83% 6.97% 11.19% 8.17% 12.24% -4.76% 14.84% 4.43 %
Lipper Intermed. Muni.
Debt Funds Avg. 1.32% 7.57% 8.26% 6.59% 10.52% 7.80% 10.18% -3.51% 12.89% 3.70 %
Consumer Price Index 4.43% 4.42% 4.65% 6.11% 3.06% 2.90% 2.75% 2.67% 2.54% 3.32 %
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: 1.14
Row: 2, Col: 1, Value: 8.219999999999999
Row: 3, Col: 1, Value: 7.83
Row: 4, Col: 1, Value: 6.970000000000001
Row: 5, Col: 1, Value: 11.19
Row: 6, Col: 1, Value: 8.17
Row: 7, Col: 1, Value: 12.24
Row: 8, Col: 1, Value: -4.76
Row: 9, Col: 1, Value: 14.84
Row: 10, Col: 1, Value: 4.430000000000001
(LARGE SOLID BOX) Limited Term
Municipal
The fund's recent strategies, performance, and holdings are detailed
twice a year in financial reports, which are sent to all shareholders.
For current performance or a free annual report, call 1-800-544-8888.
TOTAL RETURNS AND YIELDS ARE BASED ON PAST RESULTS AND ARE NOT AN
INDICATION OF FUTURE PERFORMANCE.
THE FUND IN DETAIL
CHARTER
LIMITED TERM MUNICIPAL INCOME IS A MUTUAL FUND: an investment that
pools shareholders' money and invests it toward a specified goal. The
fund is a diversified fund of Fidelity School Street Trust, an
open-end management investment company organized as a Massachusetts
business trust on September 10, 1976.
THE FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet throughout the year to oversee the fund's
activities, review contractual arrangements with companies that
provide services to the fund, and review the fund's performance. The
majority of trustees are not otherwise affiliated with Fidelity.
THE FUND MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These
meetings may be called to elect or remove trustees, change fundamental
policies, approve a management contract, or for other purposes.
Shareholders not attending these meetings are encouraged to vote by
proxy. Fidelity will mail proxy materials in advance, including a
voting card and information about the proposals to be voted on. The
number of votes you are entitled to is based upon the dollar value of
your investment.
FMR AND ITS AFFILIATES
The fund is managed by FMR, which chooses the fund's investments and
handles its business affairs.
David Murphy is Vice President and manager of Limited Term Municipal
Income, which he has managed since December 1989. He also manages
several other Fidelity funds. Mr. Murphy joined Fidelity in
1989 .
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
FIDELITY FACTS
Fidelity offers the broadest
selection of mutual funds
in the world.
(solid bullet) Number of Fidelity mutual
funds: over 225
(solid bullet) Assets in Fidelity mutual
funds: over $ 432 billion
(solid bullet) Number of shareholder
accounts: over 29 million
(solid bullet) Number of investment
analysts and portfolio
managers: over 270
(checkmark)
Fidelity Distributors Corporation (FDC) distributes and markets
Fidelity's funds and services. Fidelity Service Co mpany, Inc .
(FSC) performs transfer agent servicing functions for the fund.
FMR Corp. is the ultimate parent company of FMR. Members of the Edward
C. Johnson 3d family are the predominant owners of a class of shares
of common stock representing approximately 49% of the voting power of
FMR Corp. Under the Investment Company Act of 1940 (the 1940 Act),
control of a company is presumed where one individual or group of
individuals owns more than 25% of the voting stock of that company;
therefore, the Johnson family may be deemed under the 1940 Act to form
a controlling group with respect to FMR Corp.
UMB Bank, n.a., is the fund's transfer agent, although it employs FSC
to perform these functions for the fund. UMB is located at 1010
Grand Avenue, Kansas City, Missouri.
A broker-dealer may use a portion of the commissions paid by the fund
to reduce the fund's custodian or transfer agent fees. FMR may use its
broker-dealer affiliates and other firms that sell fund shares to
carry out the fund's transactions, provided that the fund receives
brokerage services and commission rates comparable to those of other
broker-dealers.
INVESTMENT PRINCIPLES AND RISKS
THE FUND'S INVESTMENT APPROACH
BOND FUNDS IN GENERAL. The yield and share price of a bond fund change
daily based on changes in interest rates and market conditions, and in
response to other economic, political or financial events. The types
and maturities of the securities a bond fund purchases and the credit
quality of their issuers will impact a bond fund's reaction to these
events.
INTEREST RATE RISK. In general, bond prices rise when interest rates
fall and fall when interest rates rise. Longer-term bonds are usually
more sensitive to interest rate changes. In other words, the longer
the maturity of a bond, the greater the impact a change in interest
rates is likely to have on the bond's price. In addition, short-term
interest rates and long-term interest rates do not necessarily move in
the same amount or in the same direction. A short-term bond tends to
react to changes in short-term interest rates and a long-term bond
tends to react to changes in long-term interest rates.
ISSUER RISK. The price of a bond is affected by the credit quality of
its issuer. Changes in the financial condition of an issuer, changes
in general economic conditions, and changes in specific economic
conditions that affect a particular type of issuer can impact the
credit quality of an issuer. Lower quality bonds generally tend to be
more sensitive to these changes than higher quality bonds.
MUNICIPAL MARKET RISK. Municipal securities are backed by the entity
that issued them and/or other revenue streams. Municipal security
values may be significantly affected by political changes, as well as
uncertainties in the municipal market related to taxation or the
rights of municipal securities holders.
FIDELITY'S APPROACH TO BOND FUNDS. The total return from a bond
includes both income and price gains or losses. In selecting
investments for a bond fund, FMR considers a bond's expected income
together with its potential for price gains or losses. While income is
the most important component of bond returns over time, a bond fund's
emphasis on income does not mean the fund invests only in the
highest-yielding bonds available, or that it can avoid losses of
principal.
FMR focuses on assembling a portfolio of income-producing bonds that
it believes will provide the best balance between risk and return
within the range of eligible investments for the fund. FMR's
evaluation of a potential investment includes an analysis of the
credit quality of the issuer, its structural features, its current
price compared to FMR's estimate of its long-term value, and any
short-term trading opportunities resulting from market inefficiencies.
In structuring a bond fund, FMR allocates assets among different
market sectors (for example, general obligation bonds of a state or
bonds financing a specific project) and different maturities based on
its view of the relative value of each sector or maturity. The
performance of the fund will depend on how successful FMR is in
pursuing this approach.
LIMITED TERM MUNICIPAL INCOME seeks high current income that is free
from federal income tax, consistent with preservation of capital, by
investing in investment-grade municipal securities under normal
conditions. The fund normally maintains a dollar-weighted average
maturity of 12 years or less. FMR seeks to manage the fund so that it
generally reacts to changes in interest rates similarly to municipal
bonds with maturities of between seven and 10 years. As of December
31, 1996, the fund's dollar-weighted average maturity was
approximately 8.3 years.
The fund normally invests at least 80% of its assets in
municipal securities whose interest is free from federal income tax.
In addition, the fund may invest all of its assets in municipal
securities issued to finance private activities. The interest from
these securities is a tax-preference item for purposes of the federal
alternative minimum tax.
FMR may use various techniques to hedge a portion of the fund's risks,
but there is no guarantee that these strategies will work as intended.
When you sell your shares of the fund, they may be worth more or less
than what you paid for them.
FMR normally invests the fund's assets according to its investment
strategy. The fund does not expect to invest in federally taxable
obligations. The fund also reserves the right to invest without
limitation in short-term instruments, to hold a substantial amount of
uninvested cash, or to invest more than normally permitted in
federally taxable obligations for temporary, defensive purposes.
SECURITIES AND INVESTMENT PRACTICES
The following pages contain more detailed information about types of
instruments in which the fund may invest, strategies FMR may employ in
pursuit of the fund's investment objective, and a summary of related
risks. Any restrictions listed supplement those discussed earlier in
this section. A complete listing of the fund's limitations and more
detailed information about the fund's investments are contained in the
fund's SAI. Policies and limitations are considered at the time of
purchase; the sale of instruments is not required in the event of a
subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these
techniques unless it believes that they are consistent with the fund's
investment objective and policies and that doing so will help the fund
achieve its goal. Fund holdings and recent investment strategies are
detailed in the fund's financial reports, which are sent to
shareholders twice a year. For a free SAI or financial report, call
1-800-544-8888.
DEBT SECURITIES. Bonds and other debt instruments are used by issuers
to borrow money from investors. The issuer generally pays the investor
a fixed, variable, or floating rate of interest, and must repay the
amount borrowed at maturity. Some debt securities, such as zero
coupon bonds, do not pay current interest, but are sold at a
discount from their face values.
Debt securities have varying levels of sensitivity to changes in
interest rates and varying degrees of credit quality. In general, bond
prices rise when interest rates fall, and fall when interest rates
rise. Longer-term bonds and zero coupon bonds are generally more
sensitive to interest rate changes.
In addition, bond prices are also affected by the credit
quality of the issuer. Investment-grade debt securities are
medium- and high-quality securities. Some, however, may possess
speculative characteristics , and may be more sensitive to
economic changes and to changes in the financial condition of issuers.
RESTRICTIONS: Limited Term Municipal Income invests only in
investment-grade securities . A security is considered to be
investment-grade if it is rated investment-grade by Moody's Investors
Service, Standard & Poor's, Duff & Phelps Credit Rating Co., or Fitch
Investors Service, L.P., or is unrated but judged to be of equivalent
quality by FMR.
MUNICIPAL SECURITIES are issued to raise money for a variety of public
or private purposes, including general financing for state and local
governments, or financing for specific projects or public facilities.
They may be fully or partially backed by the local government, or by
the credit of a private issuer or the current or anticipated revenues
from specific projects or assets. Because many municipal securities
are issued to finance similar types of projects, especially those
relating to education, health care, housing, transportation, and
utilities, the municipal markets can be affected by conditions in
those sectors . In addition, all municipal securities may be
affected by uncertainties regarding their tax status, legislative
changes, or rights of municipal securities holders. A municipal
security may be owned directly or through a participation interest.
CREDIT AND LIQUIDITY SUPPORT. Issuers may employ various forms of
credit and liquidity enhancement, including letters of credit,
guarantees, puts and demand features , and insurance, provided
by foreign or domestic entities such as banks and other financial
institutions. These arrangements expose the fund to the credit of the
entity providing the credit or liquidity support. Changes in the
credit quality of the provider could affect the value of the security
and the fund's share price. In addition, in the case of foreign
providers of credit or liquidity support, extensive public
information about the provider may not be available, and unfavorable
political, economic, or governmental developments could affect its
ability to honor its commitment.
ASSET-BACKED SECURITIES include interests in pools of purchase
contracts, financing leases, or sales agreements entered into by a
municipal issuer. The value of these securities depends on many
factors, including changes in market interest rates, the availability
of information concerning the pool and its structure, prepayment
expectations, the credit quality of the underlying assets, and the
market's perception of the servicer of the loan pool, and any credit
enhancement provided.
VARIABLE AND FLOATING RATE SECURITIES have interest rates that are
periodically adjusted either at specific intervals or whenever a
benchmark rate changes. Inverse floaters have interest rates that move
in the opposite direction from a benchmark, often making the
security's market value more volatile.
MUNICIPAL LEASE OBLIGATIONS are used by municipal issuers to acquire
land, equipment, or facilities. If the issuer stops making payments or
transfers its obligations to a private entity, the obligation could
lose value or become taxable.
OTHER MUNICIPAL SECURITIES may include obligations of U.S. territories
and possessions such as Guam, the Virgin Islands, and Puerto Rico, and
their political subdivisions and public corporations.
PUT FEATURES entitle the holder to put (sell back) a security to the
issuer or another party. In exchange for this benefit, a fund
may accept a lower interest rate. Demand features and standby
commitments are types of put features.
PRIVATE ENTITIES may be involved in some municipal securities. For
example, industrial revenue bonds are backed by private entities, and
resource recovery bonds often involve private corporations. The
economic viability of a project or changes in tax incentives could
affect the price of these securities.
ADJUSTING INVESTMENT EXPOSURE. The fund can use various techniques to
increase or decrease its exposure to changing security prices,
interest rates, or other factors that affect security prices. These
techniques may involve derivative transactions such as buying and
selling options and futures contracts, entering into swap agreements,
and purchasing indexed securities.
FMR can use these practices to adjust the risk and return
characteristics of a fund's portfolio of investments. If FMR judges
market conditions incorrectly or employs a strategy that does not
correlate well with the fund's investments, these techniques could
result in a loss, regardless of whether the intent was to reduce risk
or increase return. These techniques may increase the volatility of
the fund and may involve a small investment of cash relative to the
magnitude of the risk assumed. In addition, these techniques could
result in a loss if the counterparty to the transaction does not
perform as promised.
ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined
by FMR, under the supervision of the Board of Trustees, to be
illiquid, which means that they may be difficult to sell promptly at
an acceptable price. The sale of some illiquid securities and some
other securities may be subject to legal restrictions. Difficulty in
selling securities may result in a loss or may be costly to the fund.
RESTRICTIONS. The fund may not purchase a security if, as a result,
more than 10% of its assets would be invested in illiquid securities.
WHEN-ISSUED AND FORWARD PURCHASE OR SALE TRANSACTIONS are trading
practices in which payment and delivery for the security take place at
a later date than is customary for that type of security. The price of
the security could change during this period.
CASH MANAGEMENT. The fund may invest in money market securities and in
a money market fund available only to funds and accounts managed by
FMR or its affiliates, whose goal is to seek a high level of current
income exempt from federal income tax while maintaining a stable $1.00
share price. A major change in interest rates or a default on the
money market fund's investments could cause its share price to change.
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce
the risks of investing. This may include limiting the amount of money
invested in any one issuer or, on a broader scale, in any one industry
or type of project. Economic, business, or political changes
can affect all securities of a similar type.
RESTRICTIONS: With respect to 75% of its total assets, the fund may
not purchase a security if, as a result, more than 5% would be
invested in the securities of any one issuer. This limitation
do es not apply to U.S. Government securities. The fund may
invest more than 25% of its total assets in tax-free securities that
finance similar types of projects.
BORROWING. The fund may borrow from banks or from other funds advised
by FMR, or through reverse repurchase agreements. If the fund borrows
money, its share price may be subject to greater fluctuation until the
borrowing is paid off. If the fund makes additional investments while
borrowings are outstanding, this may be considered a form of leverage.
RESTRICTIONS: The fund may borrow only for temporary or emergency
purposes, but not in an amount exceeding 331/3% of its total assets.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
Some of the policies and restrictions discussed on the preceding pages
are fundamental, that is, subject to change only by shareholder
approval. The following paragraphs restate all those that are
fundamental. All policies stated throughout this prospectus, other
than those identified in the following paragraphs, can be changed
without shareholder approval.
The fund seeks the highest level of income exempt from federal
income tax that can be obtained, consistent with the preservation of
capital, from a diversified portfolio of investment-grade obligations.
The fund will normally invest so that at least 80% of its assets are
invested in municipal securities whose interest is free from federal
income tax.
With respect to 75% of its total assets, the fund may not purchase a
security if, as a result, more than 5% would be invested in the
securities of any one issuer
The fund may not invest more than 25% of its total assets in any one
industry.
The fund may borrow only for temporary or emergency purposes, but not
in an amount exceeding 33% of its total assets.
BREAKDOWN OF EXPENSES
Like all mutual funds, the fund pays fees related to its daily
operations. Expenses paid out of the fund's assets are reflected in
its share price or dividends; they are neither billed directly to
shareholders nor deducted from shareholder accounts.
The fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. The fund also pays OTHER EXPENSES, which are
explained at right.
FMR may, from time to time, agree to reimburse the fund for management
fees and other expenses above a specified limit. FMR retains the
ability to be repaid by the fund if expenses fall below the specified
limit prior to the end of the fiscal year. Reimbursement arrangements,
which may be terminated at any time without notice, can decrease the
fund's expenses and boost its performance.
MANAGEMENT FEE
The management fee is calculated and paid to FMR every month.
The fund's management fee is calculated at an annual rate of
.10% of the fund's average net assets plus 5% of gross income.
The total management fee for the fiscal year ended December
1996 was .38%.
OTHER EXPENSES
While the management fee is a significant component of the fund's
annual operating costs, the fund has other expenses as well.
FSC performs many transaction and accounting functions. These services
include processing shareholder transactions, valuing the fund's
investments, and handling securities loans. For the fiscal year ended
December 1996, FSC received fees equal to .1 6 % of the fund's
average net assets.
The fund also pays other expenses, such as legal, audit, and custodian
fees; proxy solicitation costs; and the compensation of trustees who
are not affiliated with Fidelity.
The fund has adopted a Distribution and Service Plan. This plan
recognizes that FMR may use its resources, including management fees,
to pay expenses associated with the sale of fund shares. This may
include payments to third parties, such as banks or broker-dealers,
that provide shareholder support services or engage in the sale of the
fund's shares. It is important to note, however, that the fund does
not pay FMR any separate fees for this service.
The fund's portfolio turnover rate for the fiscal year ended December
1996 was 27%. This rate varies from year to year.
YOUR ACCOUNT
DOING BUSINESS WITH FIDELITY
Fidelity Investments was established in 1946 to manage one of
America's first mutual funds. Today, Fidelity is the largest mutual
fund company in the country, and is known as an innovative provider of
high-quality financial services to individuals and institutions.
In addition to its mutual fund business, the company operates one of
America's leading discount brokerage firms, Fidelity Brokerage
Services, Inc. (FBSI). Fidelity is also a leader in providing
tax-sheltered retirement plans for individuals investing on their own
or through their employer.
Fidelity is committed to providing investors with practical
information to make investment decisions. Based in Boston, Fidelity
provides customers with complete service 24 hours a day, 365 days a
year, through a network of telephone service centers around the
country.
To reach Fidelity for general information, call these numbers:
(small solid bullet) For mutual funds, 1-800-544-8888
(small solid bullet) For brokerage, 1-800-544-7272
If you would prefer to speak with a representative in person, Fidelity
has over 80 walk-in Investor Centers across the country.
TYPES OF ACCOUNTS
You may set up an account directly in the fund or, if you own or
intend to purchase individual securities as part of your total
investment portfolio, you may consider investing in the fund through a
brokerage account.
You may purchase or sell shares of the fund through an
investment professional, including a broker, who may charge you a
transaction fee for this service. If you invest through FBSI, another
financial institution, or an investment professional, read their
program materials for any special provisions, additional service
features or fees that may apply to your investment in the fund.
Certain features of the fund, such as the minimum initial or
subsequent investment amounts, may be modified.
The different ways to set up (register) your account with Fidelity are
listed in the table that follows.
WAYS TO SET UP YOUR ACCOUNT
INDIVIDUAL OR JOINT TENANT
FOR YOUR GENERAL INVESTMENT NEEDS
Individual accounts are owned by one person. Joint accounts can have
two or more owners (tenants).
GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA)
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS
These custodial accounts provide a way to give money to a child and
obtain tax benefits. An individual can give up to $10,000 a year per
child without paying federal gift tax. Depending on state laws, you
can set up a custodial account under the Uniform Gifts to Minors Act
(UGMA) or the Uniform Transfers to Minors Act (UTMA).
TRUST
FOR MONEY BEING INVESTED BY A TRUST
The trust must be established before an account can be opened.
BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR
OTHER GROUPS
Requires a special application.
HOW TO BUY SHARES
THE FUND'S SHARE PRICE, called net asset value (NAV), is calculated
every business day. The fund's shares are sold without a sales charge.
Shares are purchased at the next share price calculated after your
investment is received and accepted. Share price is normally
calculated at 4 p.m. Eastern time.
IF YOU ARE NEW TO FIDELITY, complete and sign an account application
and mail it along with your check. You may also open your account in
person or by wire as described on page . If there is no application
accompanying this prospectus, call 1-800-544-8888.
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, you can:
(small solid bullet) Mail in an application with a check, or
(small solid bullet) Open your account by exchanging from another
Fidelity fund.
If you buy shares by check or Fidelity Money Line(registered
trademark), and then sell those shares by any method other than by
exchange to another Fidelity fund, the payment may be delayed for up
to seven business days to ensure that your previous investment has
cleared.
MINIMUM INVESTMENTS
TO OPEN AN ACCOUNT $2,500
TO ADD TO AN ACCOUNT $250
Through regular investment plans* $100
MINIMUM BALANCE $ 2 ,000
* FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE REFER
TO "INVESTOR SERVICES" PAGE .
These minimums may vary for investments through Fidelity Portfolio
Advisory Services or a Fidelity Payroll Deduction Program account in
the fund. Refer to the program materials for details.
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TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT
PHONE
1-800-544-777
(PHONE_GRAPHIC) (SMALL SOLID BULLET) EXCHANGE FROM ANOTHER
FIDELITY FUND (SMALL SOLID BULLET) EXCHANGE FROM ANOTHER FIDELITY FUND
ACCOUNT WITH THE SAME REGISTRATION, ACCOUNT WITH THE SAME REGISTRATION,
INCLUDING NAME, ADDRESS, AND INCLUDING NAME, ADDRESS, AND
TAXPAYER ID NUMBER. TAXPAYER ID NUMBER.
(SMALL SOLID BULLET) USE FIDELITY MONEY LINE TO TRANSFER
FROM YOUR BANK ACCOUNT. CALL BEFORE
YOUR FIRST USE TO VERIFY THAT THIS
SERVICE IS IN PLACE ON YOUR ACCOUNT.
MAXIMUM MONEY LINE: $50,000.
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MAIL
(MAIL_GRAPHIC) (SMALL SOLID BULLET) COMPLETE AND SIGN
THE APPLICATION. (SMALL SOLID BULLET) MAKE YOUR CHECK PAYABLE TO "FIDELITY
MAKE YOUR CHECK PAYABLE TO LIMITED TERM MUNICIPAL INCOME
"FIDELITY LIMITED TERM MUNICIPAL FUND ." INDICATE YOUR FUND ACCOUNT
INCOME FUND" MAIL TO THE ADDRESS NUMBER ON YOUR CHECK AND MAIL TO
INDICATED ON THE APPLICATION. THE ADDRESS PRINTED ON YOUR ACCOUNT
STATEMENT.
(SMALL SOLID BULLET) EXCHANGE BY MAIL: CALL
1-800-544-6666 FOR INSTRUCTIONS.
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IN PERSON
(HAND_GRAPHIC) (SMALL SOLID BULLET) BRING YOUR APPLICATION
AND CHECK TO A (SMALL SOLID BULLET) BRING YOUR CHECK TO A FIDELITY INVESTOR
FIDELITY INVESTOR CENTER. CALL CENTER. CALL 1-800-544-9797 FOR THE
1-800-544-9797 FOR THE CENTER CENTER NEAREST YOU.
NEAREST YOU.
</TABLE>
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WIRE
(WIRE_GRAPHIC) (SMALL SOLID BULLET) CALL 1-800-544-7777 TO SET UP YOUR (SMALL SOLID BULLET) WIRE TO:
ACCOUNT AND TO ARRANGE A WIRE BANKERS TRUST COMPANY,
TRANSACTION. BANK ROUTING #021001033,
(SMALL SOLID BULLET) WIRE WITHIN 24 HOURS TO: ACCOUNT #00163053.
BANKERS TRUST COMPANY, SPECIFY " FIDELITY LIMITED TERM
BANK ROUTING #021001033, MUNICIPAL INCOME FUND " AND INCLUDE
ACCOUNT #00163053. YOUR ACCOUNT NUMBER AND YOUR
SPECIFY " FIDELITY LIMITED TERM NAME.
MUNICIPAL INCOME FUND " AND INCLUDE
YOUR NEW ACCOUNT NUMBER AND YOUR
NAME.
</TABLE>
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AUTOMATICALLY
(AUTOMATIC_GRAPHIC) (SMALL SOLID BULLET) NOT AVAILABLE. (SMALL SOLID BULLET) USE FIDELITY AUTOMATIC ACCOUNT
BUILDER. SIGN UP FOR THIS SERVICE
WHEN OPENING YOUR ACCOUNT, OR CALL
1-800-544-6666 TO ADD IT.
</TABLE>
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(TDD_GRAPHIC) TDD - SERVICE FOR THE DEAF AND HEARING IMPAIRED: 1-800-544-0118
</TABLE>
HOW TO SELL SHARES
You can arrange to take money out of your fund account at any time by
selling (redeeming) some or all of your shares. Your shares will be
sold at the next share price calculated after your order is received
and accepted. Share price is normally calculated at 4 p.m. Eastern
time.
IF YOU ARE SELLING SOME BUT NOT ALL OF YOUR SHARES, leave at least
$ 2 ,000 worth of shares in the account to keep it open.
TO SELL SHARES BY BANK WIRE OR FIDELITY MONEY LINE, you will need to
sign up for these services in advance.
CERTAIN REQUESTS MUST INCLUDE A SIGNATURE GUARANTEE. It is designed to
protect you and Fidelity from fraud. Your request must be made in
writing and include a signature guarantee if any of the following
situations apply:
(small solid bullet) You wish to redeem more than $100,000 worth of
shares,
(small solid bullet) Your account registration has changed within the
last 30 days,
(small solid bullet) The check is being mailed to a different address
than the one on your account (record address),
(small solid bullet) The check is being made payable to someone other
than the account owner, or
(small solid bullet) The redemption proceeds are being transferred to
a Fidelity account with a different registration.
You should be able to obtain a signature guarantee from a bank, broker
(including Fidelity Investor Centers), dealer, credit union (if
authorized under state law), securities exchange or association,
clearing agency, or savings association. A notary public cannot
provide a signature guarantee.
SELLING SHARES IN WRITING
Write a "letter of instruction" with:
(small solid bullet) Your name,
(small solid bullet) The fund's name,
(small solid bullet) Your fund account number,
(small solid bullet) The dollar amount or number of shares to be
redeemed, and
(small solid bullet) Any other applicable requirements listed in the
table that follows.
Unless otherwise instructed, Fidelity will send a check to the record
address. Deliver your letter to a Fidelity Investor Center, or mail it
to:
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
CHECKWRITING
If you have a checkbook for your account, you may write an unlimited
number of checks. Do not, however, try to close out your account by
check.
ACCOUNT TYPE SPECIAL REQUIREMENTS
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PHONE 1-800-544-777
(PHONE_GRAPHIC) ALL ACCOUNT TYPES (SMALL SOLID BULLET) MAXIMUM CHECK REQUEST: $100,000.
(SMALL SOLID BULLET) FOR MONEY LINE TRANSFERS TO YOUR BANK ACCOUNT;
MINIMUM: $10; MAXIMUM: $100,000.
(SMALL SOLID BULLET) YOU MAY EXCHANGE TO OTHER FIDELITY FUNDS IF
BOTH ACCOUNTS ARE REGISTERED WITH THE SAME
NAME(S), ADDRESS, AND TAXPAYER ID NUMBER.
MAIL OR IN PERSON
(MAIL_GRAPHIC)
(HAND_GRAPHIC) INDIVIDUAL, JOINT TENANT, (SMALL SOLID BULLET) THE LETTER OF INSTRUCTION MUST BE SIGNED BY ALL
SOLE PROPRIETORSHIP, PERSONS REQUIRED TO SIGN FOR TRANSACTIONS,
UGMA, UTMA EXACTLY AS THEIR NAMES APPEAR ON THE ACCOUNT.
TRUST (SMALL SOLID BULLET) THE TRUSTEE MUST SIGN THE LETTER INDICATING
CAPACITY AS TRUSTEE. IF THE TRUSTEE'S NAME IS NOT
IN THE ACCOUNT REGISTRATION, PROVIDE A COPY OF THE
TRUST DOCUMENT CERTIFIED WITHIN THE LAST 60 DAYS.
BUSINESS OR ORGANIZATION (SMALL SOLID BULLET) AT LEAST ONE PERSON AUTHORIZED BY CORPORATE
RESOLUTION TO ACT ON THE ACCOUNT MUST SIGN THE
LETTER.
(SMALL SOLID BULLET) INCLUDE A CORPORATE RESOLUTION WITH CORPORATE
SEAL OR A SIGNATURE GUARANTEE.
EXECUTOR, ADMINISTRATOR, (SMALL SOLID BULLET) CALL 1-800-544-6666 FOR INSTRUCTIONS.
CONSERVATOR, GUARDIAN
WIRE
(WIRE_GRAPHIC) ALL ACCOUNT TYPES (SMALL SOLID BULLET) YOU MUST SIGN UP FOR THE WIRE FEATURE BEFORE
USING IT. TO VERIFY THAT IT IS IN PLACE, CALL
1-800-544-6666. MINIMUM WIRE: $5,000.
(SMALL SOLID BULLET) YOUR WIRE REDEMPTION REQUEST MUST BE RECEIVED
AND ACCEPTED BY FIDELITY BEFORE 4 P.M. EASTERN
TIME FOR MONEY TO BE WIRED ON THE NEXT
BUSINESS DAY.
</TABLE>
<TABLE>
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CHECK (CHECK_GRAPHIC) ALL ACCOUNT TYPES (SMALL SOLID BULLET) MINIMUM CHECK: $500.
(SMALL SOLID BULLET) ALL ACCOUNT OWNERS MUST SIGN A SIGNATURE CARD
TO RECEIVE A CHECKBOOK.
</TABLE>
<TABLE>
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(TDD_GRAPHIC) TDD - SERVICE FOR THE DEAF AND HEARING IMPAIRED: 1-800-544-0118
</TABLE>
INVESTOR SERVICES
Fidelity provides a variety of services to help you manage your
account.
INFORMATION SERVICES
FIDELITY'S TELEPHONE REPRESENTATIVES are available 24 hours a day, 365
days a year. Whenever you call, you can speak with someone equipped to
provide the information or service you need.
24-HOUR SERVICE
ACCOUNT ASSISTANCE
1-800-544-6666
ACCOUNT TRANSACTIONS
1-800-544-7777
PRODUCT INFORMATION
1-800-544-8888
RETIREMENT ACCOUNT ASSISTANCE
1-800-544-4774
TOUCHTONE XPRESSSM
1-800-544-5555
AUTOMATED SERVICE
(checkmark)
STATEMENTS AND REPORTS that Fidelity sends to you include the
following:
(small solid bullet) Confirmation statements (after every transaction,
except reinvestments, that affects your account balance or your
account registration)
(small solid bullet) Account statements (quarterly)
(small solid bullet) Financial reports (every six months)
To reduce expenses, only one copy of most financial reports and
prospectuses will be mailed to your household, even if you have more
than one account in the fund. Call 1-800-544-6666 if you need copies
of financial reports, prospectuses, or historical account information.
TRANSACTION SERVICES
EXCHANGE PRIVILEGE. You may sell your fund shares and buy shares of
other Fidelity funds by telephone or in writing.
Note that exchanges out of the fund are limited to four per calendar
year, and that they may have tax consequences for you. For details on
policies and restrictions governing exchanges, including circumstances
under which a shareholder's exchange privilege may be suspended or
revoked, see page .
SYSTEMATIC WITHDRAWAL PLANS let you set up periodic redemptions from
your account.
FIDELITY MONEY LINE(registered trademark) enables you to transfer
money by phone between your bank account and your fund account. Most
transfers are complete within three business days of your call.
REGULAR INVESTMENT PLANS
One easy way to pursue your financial goals is to invest money
regularly. Fidelity offers convenient services that let you transfer
money into your fund account, or between fund accounts, automatically.
While regular investment plans do not guarantee a profit and will not
protect you against loss in a declining market, they can be an
excellent way to invest for a home, educational expenses, and other
long-term financial goals.
REGULAR INVESTMENT PLANS
FIDELITY AUTOMATIC ACCOUNT BUILDERSM
TO MOVE MONEY FROM YOUR BANK ACCOUNT TO A FIDELITY FUND
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MINIMUM FREQUENCY SETTING UP OR CHANGING
$100 MONTHLY OR QUARTERLY (SMALL SOLID BULLET) FOR A NEW ACCOUNT, COMPLETE THE APPROPRIATE SECTION ON THE FUND
APPLICATION.
(SMALL SOLID BULLET) FOR EXISTING ACCOUNTS, CALL 1-800-544-6666 FOR AN APPLICATION.
(SMALL SOLID BULLET) TO CHANGE THE AMOUNT OR FREQUENCY OF YOUR INVESTMENT, CALL
1-800-544-6666 AT LEAST THREE BUSINESS DAYS PRIOR TO YOUR NEXT
SCHEDULED INVESTMENT DATE.
</TABLE>
DIRECT DEPOSIT
TO SEND ALL OR A PORTION OF YOUR PAYCHECK OR GOVERNMENT CHECK TO A
FIDELITY FUNDA
<TABLE>
<CAPTION>
<S> <C> <C>
MINIMUM FREQUENCY SETTING UP OR CHANGING
$100 EVERY PAY PERIOD (SMALL SOLID BULLET) CHECK THE APPROPRIATE BOX ON THE FUND APPLICATION, OR CALL
1-800-544-6666 FOR AN AUTHORIZATION FORM.
(SMALL SOLID BULLET) CHANGES REQUIRE A NEW AUTHORIZATION FORM.
</TABLE>
FIDELITY AUTOMATIC EXCHANGE SERVICE
TO MOVE MONEY FROM A FIDELITY MONEY MARKET FUND TO ANOTHER FIDELITY
FUND
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MINIMUM FREQUENCY SETTING UP OR CHANGING
$100 Monthly, bimonthly, (small solid bullet) To establish, call 1-800-544-6666 after both accounts are
quarterly, or annually opened.
(small solid bullet) To change the amount or frequency of your investment, call
1-800-544-6666.
</TABLE>
A BECAUSE ITS SHARE PRICE FLUCTUATES, THE FUND MAY NOT BE AN
APPROPRIATE CHOICE FOR DIRECT DEPOSIT OF YOUR ENTIRE CHECK.
SHAREHOLDER AND ACCOUNT POLICIES
DIVIDENDS, CAPITAL GAINS, AND TAXES
The fund distributes substantially all of its net investment income
and capital gains to shareholders each year. Income dividends are
declared daily and paid monthly. Capital gains are normally
distributed in February and December.
DISTRIBUTION OPTIONS
When you open an account, specify on your application how you want to
receive your distributions. If the option you prefer is not listed on
the application, call 1-800-544-6666 for instructions. The fund offers
four options:
1. REINVESTMENT OPTION. Your dividend and capital gain distributions
will be automatically reinvested in additional shares of the fund. If
you do not indicate a choice on your application, you will be assigned
this option.
2. INCOME-EARNED OPTION. Your capital gain distributions will be
automatically reinvested, but you will be sent a check for each
dividend distribution.
3. CASH OPTION. You will be sent a check for your dividend and capital
gain distributions.
4. DIRECTED DIVIDENDS(registered trademark) OPTION. Your dividend and
capital gain distributions will be automatically invested in another
identically registered Fidelity fund.
Dividends will be reinvested at the fund's NAV on the last day of the
month. Capital gain distributions will be reinvested at the NAV as of
the date the fund deducts the distribution from its NAV. The mailing
of distribution checks will begin within seven days, or longer for a
December ex-dividend date.
UNDERSTANDING
DISTRIBUTIONS
AS A FUND SHAREHOLDER, YOU ARE
ENTITLED TO YOUR SHARE OF THE
FUND'S NET INCOME AND GAINS
ON ITS INVESTMENTS. THE FUND
PASSES ITS EARNINGS ALONG TO ITS
INVESTORS AS DISTRIBUTIONS.
THE FUND EARNS INTEREST FROM ITS
INVESTMENTS. THESE ARE PASSED
ALONG AS DIVIDEND
DISTRIBUTIONS. THE FUND MAY
REALIZE CAPITAL GAINS IF IT SELLS
SECURITIES FOR A HIGHER PRICE
THAN IT PAID FOR THEM. THESE
ARE PASSED ALONG AS CAPITAL
GAIN DISTRIBUTIONS.
(CHECKMARK)
TAXES
As with any investment, you should consider how an investment in a
tax-free fund could affect you. Below are some of the fund's tax
implications.
TAXES ON DISTRIBUTIONS. Interest income that the fund earns is
distributed to shareholders as income dividends. Interest that is
federally tax-free remains tax-free when it is distributed.
However, gain on the sale of tax-free bonds results in taxable
distributions. Short-term capital gains and a portion of the gain on
bonds purchased at a discount are taxed as dividends. Long-term
capital gain distributions are taxed as long-term capital gains. These
distributions are taxable when they are paid, whether you take them in
cash or reinvest them. However, distributions declared in December and
paid in January are taxable as if they were paid on December 31.
Fidelity will send you and the IRS a statement showing the tax status
of the distributions paid to you in the previous year.
The interest from some municipal securities is subject to the federal
alternative minimum tax. The fund may invest up to 100% of its assets
in these securities. Individuals who are subject to the tax must
report this interest on their tax returns.
A portion of the fund's dividends may be free from state or local
taxes. Income from investments in your state are often tax-free to
you. Each year, Fidelity will send you a breakdown of the fund's
income from each state to help you calculate your taxes.
During the fiscal year ended December 1996, 100 % of the fund's
income dividends was free from federal income tax. 2.2 % of the
fund's income dividends was subject to the federal alternative minimum
tax.
TAXES ON TRANSACTIONS. Your redemptions - including exchanges to other
Fidelity funds - are subject to capital gains tax. A capital gain or
loss is the difference between the cost of your shares and the price
you receive when you sell them.
Whenever you sell shares of the fund, Fidelity will send you a
confirmation statement showing how many shares you sold and at what
price. You will also receive a consolidated transaction statement
every January. However, it is up to you or your tax preparer to
determine whether this sale resulted in a capital gain and, if so, the
amount of tax to be paid. Be sure to keep your regular account
statements; the information they contain will be essential in
calculating the amount of your capital gains.
"BUYING A DIVIDEND." If you buy shares when the fund has realized but
not yet distributed income or capital gains, you will pay the full
price for the shares and then receive a portion of the price back in
the form of a taxable distribution.
TRANSACTION DETAILS
THE FUND IS OPEN FOR BUSINESS each day the New York Stock Exchange
(NYSE) is open. Fidelity normally calculates the fund's NAV as of the
close of business of the NYSE, normally 4 p.m. Eastern time.
THE FUND'S NAV is the value of a single share. The NAV is computed by
adding the value of the fund's investments, cash, and other assets,
subtracting its liabilities, and then dividing the result by the
number of shares outstanding.
The fund's assets are valued primarily on the basis of market
quotations, if available. Since market quotations are often
unavailable, assets are usually valued by a method that the Board of
Trustees believes accurately reflects fair value.
THE FUND'S OFFERING PRICE (price to buy one share) and REDEMPTION
PRICE (price to sell one share) are its NAV.
WHEN YOU SIGN YOUR ACCOUNT APPLICATION, you will be asked to certify
that your Social Security or taxpayer identification number is correct
and that you are not subject to 31% backup withholding for failing to
report income to the IRS. If you violate IRS regulations, the IRS can
require the fund to withhold 31% of your taxable distributions and
redemptions.
YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE. Fidelity may only be
liable for losses resulting from unauthorized transactions if it does
not follow reasonable procedures designed to verify the identity of
the caller. Fidelity will request personalized security codes or other
information, and may also record calls. You should verify the accuracy
of your confirmation statements immediately after you receive them. If
you do not want the ability to redeem and exchange by telephone, call
Fidelity for instructions.
IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during
periods of unusual market activity), consider placing your order by
mail or by visiting a Fidelity Investor Center.
THE FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES for a
period of time. The fund also reserves the right to reject any
specific purchase order, including certain purchases by exchange. See
"Exchange Restrictions" on page . Purchase orders may be refused if,
in FMR's opinion, they would disrupt management of the fund.
WHEN YOU PLACE AN ORDER TO BUY SHARES, your order will be processed at
the next offering price calculated after your order is received and
accepted. Note the following:
(small solid bullet) All of your purchases must be made in U.S.
dollars and checks must be drawn on U.S. banks.
(small solid bullet) Fidelity does not accept cash.
(small solid bullet) When making a purchase with more than one check,
each check must have a value of at least $50.
(small solid bullet) The fund reserves the right to limit the number
of checks processed at one time.
(small solid bullet) If your check does not clear, your purchase will
be cancelled and you could be liable for any losses or fees the fund
or its transfer agent has incurred.
(small solid bullet) You begin to earn dividends as of the first
business day following the day of your purchase.
TO AVOID THE COLLECTION PERIOD associated with check and Money Line
purchases, consider buying shares by bank wire, U.S. Postal money
order, U.S. Treasury check, Federal Reserve check, or direct deposit
instead.
CERTAIN FINANCIAL INSTITUTIONS that have entered into sales agreements
with FDC may enter confirmed purchase orders on behalf of customers by
phone, with payment to follow no later than the time when the fund is
priced on the following business day. If payment is not received by
that time, the financial institution could be held liable for
resulting fees or losses.
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at
the next NAV calculated after your request is received and accepted.
Note the following:
(small solid bullet) Normally, redemption proceeds will be mailed to
you on the next business day, but if making immediate payment could
adversely affect the fund, it may take up to seven days to pay you.
(small solid bullet) Shares will earn dividends through the date of
redemption; however, shares redeemed on a Friday or prior to a holiday
will continue to earn dividends until the next business day.
(small solid bullet) Fidelity Money Line redemptions generally will be
credited to your bank account on the second or third business day
after your phone call.
(small solid bullet) The fund may hold payment on redemptions until it
is reasonably satisfied that investments made by check or Fidelity
Money Line have been collected, which can take up to seven business
days.
(small solid bullet) Redemptions may be suspended or payment dates
postponed when the NYSE is closed (other than weekends or holidays),
when trading on the NYSE is restricted, or as permitted by the SEC.
(small solid bullet) If you sell shares by writing a check and the
amount of the check is greater than the value of your account, your
check will be returned to you and you may be subject to additional
charges.
FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of
$12.00 from accounts with a value of less than $2,500, subject to an
annual maximum charge of $ 24 .00 per shareholder. It is expected
that accounts will be valued on the second Friday in November of each
year. Accounts opened after September 30 will not be subject to the
fee for that year. The fee, which is payable to the transfer agent, is
designed to offset in part the relatively higher costs of servicing
smaller accounts. Th is fee will not be deducted from
Fidelity brokerage accounts, retirement accounts (except
non-prototype retirement accounts), accounts using regular investment
plans, or if total assets with Fidelity exceed $ 3 0,000.
Eligibility for the $ 3 0,000 waiver is determined by aggregating
Fidelity accounts maintained by FSC or FBSI which are registered under
the same social security number or which list the same social security
number for the custodian of a Uniform Gifts/Transfers to Minors Act
account.
IF YOUR ACCOUNT BALANCE FALLS BELOW $ 2 ,000, you will be given
30 days' notice to reestablish the minimum balance. If you do not
increase your balance, Fidelity reserves the right to close your
account and send the proceeds to you. Your shares will be redeemed at
the NAV on the day your account is closed.
FIDELITY MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
FDC may, at its own expense, provide promotional incentives to
qualified recipients who support the sale of shares of the fund
without reimbursement from the fund. Qualified recipients are
securities dealers who have sold fund shares or others, including
banks and other financial institutions, under special arrangements in
connection with FDC's sales activities. In some instances, these
incentives may be offered only to certain institutions whose
representatives provide services in connection with the sale or
expected sale of significant amounts of shares.
EXCHANGE RESTRICTIONS
As a shareholder, you have the privilege of exchanging shares of the
fund for shares of other Fidelity funds. However, you should note the
following:
(small solid bullet) The fund you are exchanging into must be
available for sale in your state.
(small solid bullet) You may only exchange between accounts that are
registered in the same name, address, and taxpayer identification
number.
(small solid bullet) Before exchanging into a fund, read its
prospectus.
(small solid bullet) If you exchange into a fund with a sales charge,
you pay the percentage-point difference between that fund's sales
charge and any sales charge you have previously paid in connection
with the shares you are exchanging. For example, if you had already
paid a sales charge of 2% on your shares and you exchange them into a
fund with a 3% sales charge, you would pay an additional 1% sales
charge.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Because excessive trading can hurt fund
performance and shareholders, the fund reserves the right to
temporarily or permanently terminate the exchange privilege of any
investor who makes more than four exchanges out of the fund per
calendar year. Accounts under common ownership or control, including
accounts with the same taxpayer identification number, will be counted
together for purposes of the four exchange limit.
(small solid bullet) The fund reserves the right to refuse exchange
purchases by any person or group if, in FMR's judgment, the fund would
be unable to invest the money effectively in accordance with its
investment objective and policies, or would otherwise potentially be
adversely affected.
(small solid bullet) Your exchanges may be restricted or refused if
the fund receives or anticipates simultaneous orders affecting
significant portions of the fund's assets. In particular, a pattern of
exchanges that coincides with a "market timing" strategy may be
disruptive to the fund.
Although the fund will attempt to give you prior notice whenever it is
reasonably able to do so, it may impose these restrictions at any
time. The fund reserves the right to terminate or modify the exchange
privilege in the future.
OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose
administrative fees of up to $7.50 and redemption fees of up to 1.50%
on exchanges. Check each fund's prospectus for details.
This prospectus is printed on recycled paper using soy-based inks.
Spartan Intermediate Municipal Income Fund
(A Fund of Fidelity Union Street Trust)
Fidelity Limited Term Municipal Income Fund
(A Fund of Fidelity School Street Trust)
FORM N-14
STATEMENT OF ADDITIONAL INFORMATION
December 22, 1997
This Statement of Additional Information, relates to the proposed
reorganization whereby Fidelity Limited Term Municipal Income Fund
(Fidelity Limited Term), a fund of Fidelity School Street Trust, would
acquire all of the assets of Spartan Intermediate Municipal Income
Fund (Spartan Intermediate), a fund of Fidelity Union Street Trust,
and assume all of Spartan Intermediate's liabilities in exchange
solely for shares of beneficial interest in Fidelity Limited Term.
This Statement of Additional Information consists of this cover page
and the following described documents, each of which is incorporated
herein by reference:
1. The Statement of Additional Information of Fidelity Limited Term
Municipal Income Fund dated February 28, 1997, which was previously
filed via EDGAR (Accession No. 0000215829-97-000002).
2. The Prospectus and Statement of Additional Information of Spartan
Intermediate Municipal Income Fund dated October 21, 1997, which was
previously filed via EDGAR (Accession No. 0000035330-97-000030).
3. The Financial Statements included in the Annual Report of Fidelity
Limited Term Municipal Income Fund for the fiscal year ended December
31, 1996, which was previously filed via EDGAR (Accession No.
0000722574-97-000018).
4. The Financial Statements included in the Annual Report of Spartan
Intermediate Municipal Income Fund for the fiscal year ended August
31, 1996, which was previously filed via EDGAR (Accession No.
0000035330-96-000045).
5. The Financial Statements included in the Annual Report of Spartan
Intermediate Municipal Income Fund for the fiscal year ended August
31, 1997, which was previously filed via EDGAR (Accession No.
0000035330-97-000028).
6. The Unaudited Financial Statements included in the Semiannual
Report of Fidelity Limited Term Municipal Income Fund for the fiscal
year ended June 30, 1997, which was previously filed via EDGAR
(Accession No. 0000819118-97-000024).
7. The Unaudited Financial Statements included in the Semiannual
Report of Spartan Intermediate Municipal Income Fund for the fiscal
year ended February 28, 1997, which was previously filed via EDGAR
(Accession No. 0000035330-97-000003).
8. The Pro Forma Financial Statements for Spartan Intermediate
Municipal Income Fund and Fidelity Limited Term Municipal Income Fund
for the period ended June 30, 1997.
This Statement of Additional Information is not a prospectus. A Proxy
Statement and Prospectus dated December 22, 1997, relating to the
above-referenced matter may be obtained from Fidelity Distributors
Corporation, 82 Devonshire Street, Boston, Massachusetts, 02109. This
Statement of Additional Information relates to, and should be read in
conjunction with, such Proxy Statement and Prospectus.
PART C. OTHER INFORMATION
Item 15. Indemnification
Article XI, Section 2 of the Declaration of Trust sets forth the
reasonable and fair means for determining whether indemnification
shall be provided to any past or present Trustee or officer. It states
that the Registrant shall indemnify any present or past Trustee or
officer to the fullest extent permitted by law against liability and
all expenses reasonably incurred by him in connection with any claim,
action, suit, or proceeding in which he is involved by virtue of his
service as a Trustee, an officer, or both. Additionally, amounts paid
or incurred in settlement of such matters are covered by this
indemnification. Indemnification will not be provided in certain
circumstances, however. These include instances of willful
misfeasance, bad faith, gross negligence, and reckless disregard of
the duties involved in the conduct of the particular office involved.
Pursuant to Section 11 of the Distribution Agreement, the Registrant
agrees to indemnify and hold harmless the Distributor and each of its
directors and officers and each person, if any, who controls the
Distributor within the meaning of Section 15 of the 1933 Act against
any loss, liability, claim, damages or expense arising by reason of
any person acquiring any shares, based upon the ground that the
registration statement, Prospectus, Statement of Additional
Information, shareholder reports or other information filed or made
public by the Registrant included a materially misleading statement or
omission. However, the Registrant does not agree to indemnify the
Distributor or hold it harmless to the extent that the statement or
omission was made in reliance upon, and in conformity with,
information furnished to the Registrant by or on behalf of the
Distributor. The Registrant does not agree to indemnify the parties
against any liability to which they would be subject by reason of
willful misfeasance, bad faith, gross negligence, and reckless
disregard of the obligations and duties under the Distribution
Agreement.
Pursuant to the agreement by which Fidelity Service Company, Inc.
("Service") is appointed sub-transfer agent, the Transfer Agent agrees
to indemnify Service for Service's losses, claims, damages,
liabilities and expenses (including reasonable counsel fees and
expenses) (losses) to the extent that the Transfer Agent is entitled
to and receives indemnification from the Portfolio for the same
events. Under the Transfer Agency Agreement, the Registrant agrees to
indemnify and hold the Transfer Agent harmless against any losses,
claims, damages, liabilities, or expenses (including reasonable
counsel fees and expenses) resulting from:
(1) any claim, demand, action or suit brought by any person other
than the Registrant, including by a shareholder which names the
Transfer Agent and/or the Registrant as a party and is not based on
and does not result from the Transfer Agent's willful misfeasance, bad
faith or negligence or reckless disregard of duties, and arises out of
or in connection with the Transfer Agent's performance under the
Transfer Agency Agreement; or
(2) any claim, demand, action or suit (except to the extent
contributed to by the Transfer Agent's willful misfeasance, bad faith
or negligence or reckless disregard of duties) which results from the
negligence of the Registrant, or from the Transfer Agent's acting upon
any instruction(s) reasonably believed by it to have been executed or
communicated by any person duly authorized by the Registrant, or as a
result of the Transfer Agent's acting in reliance upon advice
reasonably believed by the Transfer Agent to have been given by
counsel for the Registrant, or as a result of the Transfer Agent's
acting in reliance upon any instrument or stock certificate reasonably
believed by it to have been genuine and signed, countersigned or
executed by the proper person.
Item 16. Exhibits
(1) Amended and Restated Declaration of Trust, dated January 19, 1995,
is incorporated herein by reference to Exhibit 1(a) of Post-Effective
Amendment No. 45.
(2) Bylaws of the Trust are incorporated herein by reference to
Exhibit 2(a) of Fidelity Union Street Trust's (File No. 2-50318)
Post-Effective Amendment No. 87.
(3) Not applicable.
(4) Agreement and Plan of Reorganization between Fidelity Union Street
Trust: Spartan Intermediate Municipal Income Fund and Fidelity School
Street Trust: Fidelity Limited Term Municipal Income Fund is filed
herein as Exhibit 1 to the Proxy Statement and Prospectus.
(5) ARTICLE VIII of the Amended and Restated Declaration of Trust,
dated January 19, 1995, is incorporated herein by reference to Exhibit
1(a) of Post-Effective Amendment No. 45.
(6)(a) Management Contract between Fidelity Limited Term Municipals
(currently known as Fidelity Limited Term Municipal Income Fund) and
Fidelity Management & Research Company dated January 1, 1995 is
incorporated herein by reference to Exhibit 5(a) of Post-Effective
Amendment No. 45.
(7)(a) General Distribution Agreement between Fidelity Limited Term
Municipals (currently known as Fidelity Limited Term Municipal Income
Fund) and Fidelity Distributors Corporation, dated April 1, 1987, is
incorporated herein by reference to Exhibit 6(a) of Post-Effective
Amendment No. 45.
(b) Amendment, dated January 1, 1988, to the General Distribution
Agreement between Fidelity Limited Term Municipals (currently known as
Fidelity Limited Term Municipal Income Fund) and Fidelity Distributors
Corporation, is incorporated herein by reference to Exhibit 6(b) of
Post-Effective Amendment No. 45.
(c) Amendments to the General Distribution Agreement between the
Registrant and Fidelity Distributors Corporation, dated March 14, 1996
and July 15, 1996, are incorporated herein by reference to Exhibit
6(a) of Fidelity Court Street Trust's Post-Effective Amendment No. 61
(File No. 2-58774).
(8)(a) Retirement Plan for Non-Interested Person Trustees, Directors
or General Partners, as amended on November 16, 1995, is incorporated
herein by reference to Exhibit 7(a) of Fidelity Select Portfolio's
(File No. 2-69972) Post-Effective Amendment No. 54.
(b) The Fee Deferral Plan for Non-Interested Person Directors and
Trustees of the Fidelity Funds, effective as of September 14, 1995 and
amended through November 14, 1996, is incorporated herein by reference
to Exhibit 7(b) of Fidelity Aberdeen Street Trust's (File No.
33-43529) Post-Effective Amendment No. 19.
(9)(a) Custodian Agreement, Appendix B, and Appendix C, dated December
1, 1994, between UMB Bank, n.a. and Fidelity School Street Trust on
behalf of Fidelity Limited Term Municipals (currently known as
Fidelity Limited Term Municipal Income Fund) is incorporated herein by
reference to Exhibit 8 of Fidelity California Municipal Trust's
Post-Effective Amendment No. 28 (File No. 2-83367).
(b) Appendix A, dated October 17, 1996, to the Custodian
Agreement, dated December 1, 1994, between UMB Bank, n.a. and Fidelity
School Street Trust on behalf of Fidelity Limited Term Municipals
(currently known as Fidelity Limited Term Municipal Income Fund) is
incorporated herein by reference to Exhibit 8(a) of Fidelity Court
Street Trust's Post-Effective Amendment No. 61 (File No. 2-58774).
(10) Distribution and Service Plan pursuant to Rule 12b-1 for Fidelity
Limited Term Municipals (currently known as Fidelity Limited Term
Municipal Income Fund) is incorporated herein by reference to Exhibit
15(a) of Post-Effective Amendment No. 45.
(11) Opinion and consent of counsel (K&L) as to the legality of shares
being registered is filed herein as Exhibit 11.
(12) Opinion and Consent of counsel (K&L) as to tax matters in
connection with the reorganization of Spartan Intermediate Municipal
Income Fund is filed herein as Exhibit 12.
(13) Not applicable.
(14) Consent of Coopers & Lybrand L.L.P. is filed herein as Exhibit
14.
(15) Pro Forma Financial Statements for the period ended June 30,
1997, are filed herein as Exhibit 15.
(16) Powers of Attorney, dated December 19, 1996, March 6, 1997, and
July 17, 1997, are filed herein as Exhibit 16.
(17) Rule 24f-2 Notice for Registrant's most recent fiscal year ended
December 31, 1996 is filed herein as Exhibit 17.
Item 17. Undertakings
(1) The undersigned Registrant agrees that prior to any public
reoffering of the securities registered through the use of the
prospectus which is a part of this Registration Statement by any
person or party who is deemed to be an underwriter within the meaning
of Rule 145(c) of the Securities Act of 1933, the reoffering
prospectus will contain the information called for by the applicable
registration form for reoffering by persons who may be deemed
underwriters, in addition to the information called for by the other
items of the applicable form.
(2) The undersigned Registrant agrees that every prospectus that is
filed under paragraph (1) above will be filed as part of an amendment
to the Registration Statement and will not be used until the amendment
is effective, and that, in determining any liability under the
Securities Act of 1933, each Post-Effective Amendment shall be deemed
to be a new Registration Statement for the securities offered therein,
and the offering of securities at that time shall be deemed to be the
initial bona fide offering of them.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Boston, and
Commonwealth of Massachusetts, on the 27 day of October 1997.
FIDELITY SCHOOL STREET TRUST
By /s/Edward C. Johnson 3d (dagger)
Edward C. Johnson 3d, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons
in the capacities and on the dates indicated.
(SIGNATURE) (TITLE) (DATE)
<TABLE>
<CAPTION>
<S> <C> <C>
/S/EDWARD C. JOHNSON 3D (DAGGER) PRESIDENT AND TRUSTEE OCTOBER 27, 1997
EDWARD C. JOHNSON 3D (PRINCIPAL EXECUTIVE OFFICER)
/S/RICHARD A. SILVER TREASURER OCTOBER 27, 1997
RICHARD A. SILVER
/S/ROBERT C. POZEN TRUSTEE OCTOBER 27, 1997
ROBERT C. POZEN
/S/RALPH F. COX * TRUSTEE OCTOBER 27, 1997
RALPH F. COX
/S/PHYLLIS BURKE DAVIS * TRUSTEE OCTOBER 27, 1997
PHYLLIS BURKE DAVIS
/S/ROBERT M. GATES ** TRUSTEE OCTOBER 27, 1997
ROBERT M. GATES
/S/E. BRADLEY JONES * TRUSTEE OCTOBER 27, 1997
E. BRADLEY JONES
/S/DONALD J. KIRK * TRUSTEE OCTOBER 27, 1997
DONALD J. KIRK
/S/PETER S. LYNCH * TRUSTEE OCTOBER 27, 1997
PETER S. LYNCH
/S/MARVIN L. MANN * TRUSTEE OCTOBER 27, 1997
MARVIN L. MANN
/S/WILLIAM O. MCCOY * TRUSTEE OCTOBER 27, 1997
WILLIAM O. MCCOY
/S/GERALD C. MCDONOUGH * TRUSTEE OCTOBER 27, 1997
GERALD C. MCDONOUGH
/S/THOMAS R. WILLIAMS * TRUSTEE OCTOBER 27, 1997
THOMAS R. WILLIAMS
</TABLE>
(dagger) Signatures affixed by Robert C. Pozen pursuant to a power of
attorney dated July 17, 1997 and filed herewith.
* Signature affixed by Robert C. Hacker pursuant to a power of
attorney dated December 19, 1996 and filed herewith.
** Signature affixed by Robert C. Hacker pursuant to a power of
attorney dated March 6, 1997 and filed herewith.
EXHIBIT 11
October 23, 1997
Fidelity School Street Trust
Fidelity Union Street Trust
82 Devonshire Street
Boston, Massachusetts 02109
Ladies and Gentlemen:
You have requested our opinion regarding certain matters in
connection with the issuance of shares of Fidelity Limited Term
Municipal Income Fund ("Fidelity Limited Term"), a series of Fidelity
School Street Trust (the "Trust"), pursuant to a Registration
Statement to be filed by the Trust on Form N-14 ("Registration
Statement") under the Securities Act of 1933 ("1933 Act") in
connection with the proposed acquisition by Fidelity Limited Term of
all of the assets of Spartan Intermediate Municipal Income Fund (the
"Merged Fund"), a series of Fidelity Union Street Trust, and the
assumption by Fidelity Limited Term of the liabilities of the Merged
Fund solely in exchange for Fidelity Limited Term shares.
In connection with our services as counsel for the Trust, we have
examined, among other things, originals or copies of such documents,
certificates and corporate and other records as we deemed necessary or
appropriate for purposes of this opinion. We have assumed the
genuineness of all signatures, the authenticity of all documents
submitted to us, the conformity to original documents of all documents
presented to us as copies thereof and the authenticity of the original
documents from which any such copies were made, which assumptions we
have not independently verified. As to various matters of fact
material to this opinion, we have relied upon statements and
certificates of officers of the Trust. Based upon this examination,
we are of the opinion that the shares to be issued pursuant to the
Registration Statement, when issued upon the terms provided in the
Registration Statement, subject to compliance with the 1933 Act, the
Investment Company Act of 1940, and applicable state law regulating
the offer and sale of securities, will be legally issued, fully paid,
and non-assessable.
The Trust is an entity of the type commonly known as a "Massachusetts
business trust." Under Massachusetts law, shareholders of a business
trust may be held personally liable for the obligations of the Trust.
The Trust's Declaration of Trust provides that the Trustees shall have
no power to bind any shareholder personally or to call upon any
shareholder for the payment of any sum of money or assessment
whatsoever other than such as the shareholder may at any time
personally agree to pay by way of subscription for any shares or
otherwise. The Declaration of Trust also requires that every note,
bond, contract or other undertaking issued by, or on behalf of, the
Trust or the Trustees relating to the Trust shall include a recitation
limiting the obligation represented thereby to the Trust and its
assets (although the omission of such recitation shall not operate to
bind any shareholder). The Declaration of Trust provides that: (i) in
case any shareholder or any former shareholder of any Series of the
Trust shall be held personally liable solely by reason of his being or
having been a shareholder and not because of his acts or omissions or
for some other reason, the shareholder or former shareholder shall be
entitled out of the assets belonging to the applicable Series to be
held harmless from and indemnified against all loss and expense
arising from such liability; and (ii) a Series shall, upon request by
the shareholder, assume the defense of any claim made against any
shareholder for any act or obligation of that Series and satisfy any
judgment thereon.
We hereby consent to the reference to our firm under the captions
"Federal Income Tax Consequences of the Reorganization," "Federal
Income Tax Considerations" and "Legal Matters" in the Proxy Statement
and Prospectus which constitute a part of the Registration Statement.
We further consent to your filing a copy of this opinion as an exhibit
to the Registration Statement.
Yours truly,
/s/ Kirkpatrick & Lockhart LLP
Kirkpatrick & Lockhart LLP
EXHIBIT 12
October 27, 1997
Fidelity Union Street Trust
Fidelity School Street Trust
82 Devonshire Street
Boston, MA 02109
Ladies and Gentlemen:
Fidelity Union Street Trust ("FUST"), a Massachusetts business trust,
on behalf of Spartan Intermediate Municipal Income Fund ("Acquired"),
a series of FUST, and Fidelity School Street Trust ("FSST"), a
Massachusetts business trust, on behalf of Fidelity Limited Term
Municipal Income Fund ("Acquiring"), a series of FSST, have requested
our opinion as to certain federal income tax consequences of a
transaction ("Reorganization") in which Acquiring will acquire all of
the assets and assume all of the liabilities of Acquired in exchange
solely for shares of beneficial interest in Acquiring ("Acquiring
Shares") pursuant to an Agreement and Plan of Reorganization
("Agreement") expected to be entered into between Acquired and
Acquiring on December 22, 1997.
In rendering this opinion, we have examined a draft of the Agreement
("Draft Agreement"), the prospectus/proxy statement to be filed with
the Securities and Exchange Commission ("SEC") in connection with the
Reorganization, the currently effective prospectuses and statements of
additional information of Acquired and Acquiring, and such other
documents as we have deemed necessary. We have also relied, with your
consent, on certificates of officers of FUST and FSST.
OPINION
Based solely on the facts and representations set forth in the
reviewed documents and the certificates of officers of FUST and FSST,
and assuming that (i) those representations are true on the date of
the Reorganization, (ii) the Reorganization is consummated in
accordance with the Agreement, and (iii) the Agreement does not differ
materially from the Draft Agreement, our opinion with respect to the
federal income tax consequences of the Reorganization is as follows.
1. The Reorganization will be a reorganization under section
368(a)(1)(C) of the Internal Revenue Code of 1986, as amended
("Code"), and Acquired and Acquiring will each be parties to the
Reorganization under section 368(b) of the Code.
2. No gain or loss will be recognized by Acquired upon the transfer
of all of its assets to Acquiring in exchange solely for Acquiring
Shares and Acquiring's assumption of Acquired's liabilities followed
by the distribution of those Acquiring Shares to the Acquired
shareholders in liquidation of Acquired.
3. No gain or loss will be recognized by Acquiring on the receipt of
Acquired's assets in exchange solely for Acquiring Shares and the
assumption of Acquired's liabilities.
4. The basis of Acquired's assets in the hands of Acquiring will be
the same as the basis of such assets in Acquired's hands immediately
prior to the Reorganization.
5. Acquiring's holding period in the assets to be received from
Acquired will include Acquired's holding period in such assets.
6. The Acquired shareholders will recognize no gain or loss on the
exchange of the shares of beneficial interest in Acquired ("Acquired
Shares") solely for the Acquiring Shares in the Reorganization.
7. The Acquired shareholders' basis in the Acquiring Shares to be
received by them will be the same as their basis in the Acquired
Shares to be surrendered in exchange therefor.
8. The holding period of the Acquiring Shares to be received by the
Acquired shareholders will include the holding period of the Acquired
Shares to be surrendered in exchange therefor, provided those Acquired
Shares were held as capital assets on the date of the Reorganization.
The foregoing opinion is based on, and is conditioned on the
continued applicability of, the provisions of the Code and the
regulations thereunder, case law precedent, and the Internal Revenue
Service pronouncements in existence at the date hereof. We express no
opinion as to whether Acquired will recognize gain under Section 1256
of the Code on the transfer of futures, forwards, or options to
Acquiring in the Reorganization. Nor do we express any opinion other
than those contained herein.
We consent to the inclusion of this opinion in the Registration
Statement on Form N 14 filed with the SEC and the inclusion of the
name "Kirkpatrick & Lockhart LLP" in the "Federal Income Tax
Consequences of the Reorganization," "Federal Income Tax
Considerations" and "Legal Matters" sections of that Registration
Statement.
Very truly yours,
/s/Kirkpatrick & Lockhart LLP
Kirkpatrick & Lockhart LLP
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference, into the Proxy
Statement and Prospectus (the Proxy/Prospectus) constituting part of
this Registration Statement on Form N-14 (the Registration Statement)
of Fidelity School Street Trust: Fidelity Limited Term Municipal
Income Fund, of our report dated February 4, 1997 on the financial
statements and financial highlights included in the December 31, 1996
Annual Report to Shareholders of Fidelity School Street Trust:
Fidelity Limited Term Municipal Income Fund.
We also consent to the incorporation by reference in the Registration
Statement, of our report dated October 4, 1996 on the financial
statements and financial highlights included in the August 31, 1996
Annual Report to Shareholders of Fidelity Union Street Trust: Spartan
Intermediate Municipal Income Fund. In addition, we consent to the
incorporation by reference in the Registration Statement, of our
report dated October 3, 1997 on the financial statements and financial
highlights included in the August 31, 1997 Annual Report to
Shareholders of Fidelity Union Street Trust: Spartan Intermediate
Municipal Income Fund.
We further consent to the references to our Firm under the headings
"Experts" and "Financial Highlights" in the Proxy/Prospectus and to
the references to our Firm under the headings "Financial Highlights"
in the Prospectuses and "Auditor" in the Statements of Additional
Information for Fidelity School Street Trust: Fidelity Limited Term
Municipal Income Fund and Fidelity Union Street Trust: Spartan
Intermediate Municipal Income Fund, which are also incorporated by
reference into the Proxy/Prospectus.
/s/COOPERS & LYBRAND L.L.P
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
October 27, 1997
<ERROR: WIDE TABLE>
ERROR: THE FOLLOWING TABLE: "13X42TABLE" IS TOO WIDE!
TABLE WIDTH IS 258 CHARACTERS.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
<C> <C> <C> <C> <C> <C> <C> <C>
FIDELITY LIMITED TERM MUNICIPAL INCOME FUND
AND SPARTAN INTERMEDIATE MUNICIPAL INCOME FUND
PRO FORMA COMBINING STATEMENT OF ASSETS & LIABILITIES AS OF JUNE 30, 1997
(UNAUDITED)
FIDELITY LIMITED
TERM SPARTAN INTERMEDIATE PRO FORMA PRO FORMA
MUNICIPAL INCOME MUNICIPAL INCOME COMBINED ADJUSTMENTS COMBINED
ASSETS
INVESTMENT IN SECURITIES,
AT VALUE
- SEE ACCOMPANYING
SCHEDULE $ 881,711,000 $ 206,895,694 $ 1,088,606,694 - $ 1,088,606,694
CASH - - - - -
INTEREST RECEIVABLE 10,365,000 2,568,252 12,933,252 - 12,933,252
OTHER RECEIVABLES 10,000 - 10,000 - 10,000
TOTAL ASSETS 892,086,000 209,463,946 1,101,549,946 1,101,549,946
LIABILITIES
PAYABLE FOR
INVESTMENTS
PURCHASED
REGULAR DELIVERY $ - $ 3,849,346 $ 3,849,346 - $ 3,849,346
DELAYED DELIVERY 7,878,000 - 7,878,000 - 7,878,000
PAYABLE FOR FUND
SHARES REDEEMED 565,000 112,468 677,468 - 677,468
DISTRIBUTIONS
PAYABLE 828,000 161,336 989,336 - 989,336
ACCRUED MANAGEMENT
FEE 260,000 95,259 355,259 - 355,259
PAYABLE FOR DAILY
VARIATION ON
FUTURES CONTRACTS 91,000 - 91,000 - 91,000
OTHER PAYABLES AND
ACCRUED EXPENSES 161,000 - 161,000 - 161,000
TOTAL LIABILITIES 9,783,000 4,218,409 14,001,409 14,001,409
NET ASSETS $ 882,303,000 $ 205,245,537 $ 1,087,548,537 $ 1,087,548,537
NET ASSETS CONSIST
OF:
PAID IN CAPITAL $ 850,457,000 $ 208,980,518 $ 1,059,437,518 - $ 1,059,437,518
ACCUMULATED UNDISTRIBUTED
NET REALIZED GAIN (LOSS) ON
INVESTMENTS (2,605,000) (8,549,382) (11,154,382) - (11,154,382)
NET UNREALIZED APPRECIATION
(DEPRECIATION) ON
INVESTMENTS 34,451,000 4,814,401 39,265,401 - 39,265,401
NET ASSETS $ 882,303,000 $ 205,245,537 $ 1,087,548,537 $ 1,087,548,537
NET ASSET VALUE
NET ASSETS $882,303,000 $205,245,537 $1,087,548,537 $1,087,548,537
OFFERING PRICE AND
REDEMPTION PRICE
PER SHARE $9.72 $10.28 $9.82 $9.72
SHARES OUTSTANDING 90,786,000 19,966,309 110,752,309 1,149,487(A) 111,901,796
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FIDELITY LIMITED TERM MUNICIPAL INCOME FUND
AND SPARTAN INTERMEDIATE MUNICIPAL INCOME FUND
PRO FORMA COMBINING STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1997
(UNAUDITED)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FIDELITY LIMITED SPARTAN PRO FORMA PRO FORMA
TERM INTERMEDIATE
MUNICIPAL INCOME MUNICIPAL INCOME COMBINED ADJUSTMENTS COMBINED
INTEREST $ 50,945,000 $11,286,434 $ 62,231,434 $ - $ 62,231,434
INCOME
EXPENSES
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Management $3,462,000 $1,172,256 $ 4,634,256 $ $ 4,283,719
fee (350,537)(b)
Transfer agent, 1,493,000 - 1,493,000 242,899(c) 1,735,899
accounting and
custodian fees
and expenses
Non-interested 4,000 2,399 6,399 0 6,399
trustees'
compensation
Registration 39,000 - 39,000 (439)(d) 38,561
fees
Audit 58,000 - 58,000 2,000 (c) 60,000
Legal 14,000 - 14,000 3,323 (c) 17,323
Miscellaneous 7,000 - 7,000 1,661 (c) 8,661
Total expenses 5,077,000 1,174,655 6,251,655 (101,093) 6,150,562
before
reductions
Expense (32,000) (9,410) (41,410) (219,045)(e) (260,455)
reductions
Total expenses 5,045,000 1,165,245 6,210,245 (320,138) 5,890,107
NET INTEREST 45,900,000 10,121,189 56,021,189 320,138 56,341,327
INCOME
REALIZED AND
UNREALIZED
GAIN (LOSS)
Net realized
gain (loss) on:
Investment 8,285,000 967,307 9,252,307 - 9,252,307
securities
Futures 409,000 (51,063) 357,937 - 357,937
contracts
Change in net
unrealized
apprecation
(depreciation)
on:
Investment 9,399,000 3,843,153 13,242,153 - 13,242,153
securities
Futures 353,000 0 353,000 - 353,000
contracts
NET GAIN (LOSS) 18,446,000 4,759,397 23,205,397 - 23,205,397
NET INCREASE
(DECREASE) IN
NET ASSETS
RESULTING
FROM $64,346,000 $14,880,586 $79,226,586 $320,138 $79,546,724
OPERATIONS
</TABLE>
Fidelity Limited Term Municipal Income Fund
Spartan Intermediate Municipal Income Fund
Notes to Pro Forma Combining Financial Statements
(Unaudited)
The accompanying unaudited Pro Forma Combining Schedule of
Investments and Statement of Assets and Liabilities as of June 30,
1997 and the unaudited Pro Forma Combining Statement of Operations for
the year ended June 30, 1997 are intended to present the financial
condition and related results of operations of Fidelity Limited Term
Municipal Fund as if the reorganization and decrease in the expense
limitation with Spartan Intermediate Municipal Fund, had been
consummated at July 1, 1996. Had the pro forma adjustments not
included the effect of the expense limitation, Pro Forma Combined
Expense reductions would have been $13,410, resulting in Pro Forma
Combined Net Interest Income and Pro Forma Combined Net Increase in
Net Assets resulting from operations of $56,094,282 and $79,299,679,
respectively.
The pro forma adjustments to these pro forma financial statements are
comprised of:
(a) Reflects the conversion of the Spartan Intermediate Municipal
Fund
shares as of June 30, 1997.
(b) Decrease in management fee to reflect Fidelity Limited
Term Municipal Fund's fee
applied to the combined fund's average net assets.
(c) Increase in fees reflects change from Spartan Intermediate
Municipal Income Fund's
all-inclusive fee structure to Fidelity Limited Term Municipal Income
Fund's fee
structure.
(d) Decrease in fees reflects elimination of duplicate charges.
(e ) Reflects reduction in expenses due to FMR's agreement to
temporarily limit the
combined fund's expenses to 0.53% of average net assets.
The unaudited pro forma combining statements should be read in
conjunction with the separate annual audited financial statements as
of December 31, 1996 and unaudited semi annual financial statements as
of June 30, 1997 for Fidelity Limited Term Municipal Income Fund and
the separate annual audited financial statements as of August 31, 1996
and unaudited semi annual financial statements as of February 28, 1997
for Spartan Intermediate Municipal Income Fund, which are incorporated
by reference in the Statement of Additional Information to this Proxy
and Prospectus.
FIDELITY LIMITED TERM MUNICIPAL INCOME FUND
AND
SPARTAN INTERMEDIATE MUNICIPAL INCOME FUND
PRO FORMA COMBINED SCHEDULE OF INVESTMENTS
JUNE 30, 1997
UNAUDITED
MUNICIPAL BONDS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
RATIN FIDELITY SPARTAN PRINCIPAL FIDELITY SPARTAN VALUE CUSIP
G LIMITED INTERMED LIMITED INTERMED
TERM IATE TERM IATE
MUNICIPA MUNICIPA COMBINE MUNICIPA MUNICIPA COMBINE
L INCOME L INCOME D L INCOME L INCOME D
ALABAMA
Alabama Gen. Aa 10,000,00 10,000,0 8,462,50 8,462,50 010410Z
Oblig. Rfdg. (Cap. 0 00 0 0 P
Appreciation) 0%
3/1/01
Alabama Gen. Aa 5,000,000 5,000,00 4,137,50 4,137,50 010410Z
Oblig. Rfdg. (Cap. 0 0 0 Q
Appreciation) 0%
9/1/01
15,000,0 12,600,0
00 00
ALASKA
Anchorage Hosp. A1 2,575,000 2,575,00 2,813,18 2,813,18 033204C
Rev. Rfdg. 0 8 8 F
(Sisters of
Providence Proj.)
Series 1991,
6.75% 10/1/02
(Sisters Of
Providence, WA
Insured)
North Slope Aaa 12,000,00 12,000,0 9,960,000 9,960,00 662523R
Borough (Cap. 0 00 0 B
Appreciation)
Series A, 0%
6/30/01, (MBIA
Insured)
North Slope Aaa 10,000,00 1,500,000 11,500,0 7,462,50 1,119,375 8,581,87 662523R
Borough (Cap. 0 00 0 5 F
Appreciation)
Series A, 0%
6/30/03, (MBIA
Insured)
North Slope Aaa 8,500,000 8,500,00 6,853,12 6,853,12 662523R
Borough (Cap. 0 5 5 Q
Appreciation)
Series B, 0%
1/1/02, (MBIA
Insured)
North Slope Aaa 20,000,00 3,950,000 23,950,0 15,750,0 3,110,625 18,860,6 662523R
Borough Cap. 0 00 00 25 D
Appreciation
Series A, 0%
6/30/02, (MBIA
Insured)
North Slope Aaa 3,200,000 3,200,00 2,448,00 2,448,00 662523R
Borough Series 0 0 0 R
B, 0%
1/1/03,(MBIA
Insured)
61,725,0 49,516,8
00 13
ARIZONA
Arizona St. Aaa 1,220,000 1,220,00 1,351,150 1,351,15 040649F
Transn. Brd. 0 0 A
Excise Tax Rev.
(Maricopa County
Regl. Area-B)
6.50% 7/1/04
(AMBAC Insured)
Arizona St. Aaa 1,100,000 1,100,00 1,218,250 1,218,25 040649E
Transn. Brd. 0 0 Q
Excise Tax
Rev.(Maricopa
County Regl.
Area-B) 6.50%
7/1/04, (AMBAC
Insured)
Arizona Trans. Aaa 2,260,000 1,300,000 3,560,00 2,426,67 1,395,875 3,822,55 040649E
Board Excise Tax 0 5 0 P
Rev. (Maricopa
County Regional
Area Road-B
Proj.) 6% 7/1/03,
(AMBAC Insured)
Arizona Trans. Aaa 1,700,000 1,700,00 1,349,375 1,349,37 040649A
Board Excise Tax 0 5 Z
Rev. (Maricopa
Reg'l. Road)
(Cap.
Appreciation)
Series A, 0%
7/1/02 (FGIC
Insured)
Arizona Univ. A1 2,100,000 2,100,00 2,283,75 2,283,75 914063Z
Rev. Rfdg. (Univ. 0 0 0 G
Rev. Sys.)
6.375% 6/1/05
Maricopa County Aa 2,000,000 2,000,00 2,117,500 2,117,50 566795C
Commty. College 0 0 U
Dist. Series A,
6% 7/1/09
Maricopa County Baa1 1,920,000 1,920,00 1,944,00 1,944,00 566761L
Ind. Dev. Auth. 0 0 0 G
Hosp. Facs. Rev.
Rfdg. (Sun Health
Corp.) 5.75%
4/1/07
Phoenix Civic Aa 2,420,000 2,420,00 2,528,900 2,528,90 71884AC
Impt. Corp. 0 0 Y
Excise Tax Rev.
Rfdg. (Arpt.
Impts.) Series A,
5.85% 7/1/01AMT
16,020,0 16,615,4
00 75
ARKANSAS
Arkansas College Aa 705,000 705,000 556,950 556,950 041039N
Savings 0% B
6/1/02
Arkansas College Aa 1,190,000 1,190,00 891,012 891,012 041039N
Savings 0% 0 C
6/1/03
1,895,00 1,447,96
0 2
CALIFORNIA
California Edl. -- 3,000,000 3,000,00 2,898,75 2,898,75 130174J
Facs. Auth. Rev. 0 0 0 2
Rfdg. (Chapman
Univ.) 5.375%
10/1/16
California Gen. A1 7,500,000 7,500,00 8,081,25 8,081,25 130627B
Oblig. 6.25% 0 0 0 B
10/1/19
California Gen. A 1,625,000 1,625,00 1,748,90 1,748,90 13068GX
Oblig. Pub. Wks. 0 6 6 H
Board Lease
6.30% 10/1/10
California Hsg. Aa 19,346,00 19,346,0 3,675,74 3,675,74 130329Q
Fin. Agcy. Rev. 0 00 0 0 E
(Home Mtg.)
Series 1983 A,
0% 2/1/15
California Hsg. Aaa 2,000,000 2,000,00 2,075,00 2,075,00 13033EK
Fin. Agcy. Rev. 0 0 0 C
(Home
Mtg.)Series G,
6% 2/1/10, (MBIA
Insured)(AMT)
California Poll. A1 4,000,000 4,000,00 4,325,00 4,325,00 130535B
Cont. Fing. Auth. 0 0 0 D
Resource
Recovery Rev.
(Waste
Management Inc.)
7.15% 2/1/11
California Pub. A 1,200,000 1,200,00 1,252,50 1,252,50 13068GH
Wks. Board 0 0 0 G
Lease Rev.
(Franchise Tax
Board-PH II)
Series A, 6.25%
9/1/11
California Pub. A 4,690,000 4,690,00 4,584,47 4,584,47 13068G4
Wrks. Board 0 5 5 K
Lease Rev. Rfdg.
(Dept.
Corrections State
Prisons,
Monterey) Series
D, 5.375%
11/1/14
California Rural Aaa 3,000,000 3,000,00 2,988,75 2,988,75 130574A
Home Mtg. Fin. 0 0 0 A
Auth. Lease Rev.
Series A, 4.45%
8/1/01 (MBIA
Insured)
California St. A1 1,000,000 1,000,00 1,171,25 1,171,25 130622X
Gen. Oblig. 8% 0 0 0 Q
5/1/03
California State Aaa 1,640,000 1,640,00 1,625,65 1,625,65 13068HA
Pub. Works Board 0 0 0 P
Lease Rev.
Refdg. (Univ. of
California Proj.)
SeriesA, 5.10%
12/1/10 (AMBAC
Insured)
California A+ 3,300,000 1,115,000 4,415,00 3,382,50 1,142,875 4,525,37 130909C
Statewide 0 0 5 K
Commtys. Dev.
Auth. Rev. Ctfs. of
Prtn. Rfdg. (Hosp.
Triad Healthcare)
5.90% 8/1/01
California -- 4,145,000 4,145,00 4,269,35 4,269,35 130909C
Statewide 0 0 0 L
Commtys. Dev.
Auth. Rev. Ctfs.
Partn. Rfdg.
(Hosp. Triad
Healthcare) 6%
8/1/02
Carson Redev. Baa 1,350,000 1,350,00 1,353,375 1,353,37 145750D
Agcy. Rfdg. 0 5 J
(Redev. Proj.
Area 2) (Tax
Allocation) 5.40%
10/1/01
Carson Redev. Baa 1,320,000 1,320,00 1,324,950 1,324,95 145750D
Agcy. Rfdg. 0 0 K
(Redev. Proj.
Area 2) (Tax
Allocation) 5.50%
10/1/02
Carson Redev. Baa 1,500,000 1,500,00 1,507,500 1,507,50 145750D
Agcy. Rfdg. 0 0 L
(Redev. Proj.
Area 2) (Tax
Allocation) 5.60%
10/1/03
Central California 1,130,000 1,130,00 1,113,050 1,113,05 152757A
Joint powers 0 0 L
Health Fing. Auth.
Ctfs. of Prtn.
Central Valley Fin. BBB- 1,875,000 1,875,00 1,917,187 1,917,18 155689A
Auth. 0 7 D
Cogeneration
Proj. Rev.
(Carson Ice Gen.
Proj.) 5.50%
7/1/01
Central Valley Fin. BBB- 1,300,000 1,300,00 1,348,750 1,348,75 155689A
Auth. 0 0 J
Cogeneration
Proj. Rev.
(Carson Ice Proj.)
5.80% 7/1/04
Clovis Unified Aaa 5,700,000 5,700,00 4,488,750 4,488,75 189342Q
School Dist. 0 0 K
Series B, 0%
8/1/02, (MBIA
Insured)
East Bay Muni. Aaa 1,000,000 1,000,00 956,250 956,250 271014J
Util. Dist. Wtr. 0 R
Sys. Rev. Rfdg.
5% 6/1/13 (FGIC
Insured)
East Bay Muni. Aaa 1,000,000 1,000,00 1,036,25 1,036,25 271014G
Util. Dist. Wtr. 0 0 0 P
Sys. Rev. Rfdg.
Sub. 6% 6/1/12
(FGIC Insured)
Los Angeles Cnty. Aaa 2,195,000 2,195,00 2,082,50 2,082,50 54473EA
Pub. Wks. Fing. 0 6 6 Q
Auth. Lease Rev.
(Multi Cap. Facs.
Projs.#5) 4.75%
12/1/10 (MBIA
Insured)
Modesto Irrigation Aaa 4,390,000 4,390,00 5,668,58 5,668,58 607763B
Dist. Elec. Rev. 0 8 8 A
Series B, 9.625%
1/1/11 (Escrowed
to Maturity)
Orange County Baa 1,335,000 1,335,00 1,400,081 1,400,08 684246B
Dev. Agcy. Tax 0 1 W
Allocation (Santa
Ana Heights
Proj.) 6% 9/1/05
Riverside Elec. Aaa 2,000,000 2,000,00 2,035,00 2,035,00 768874J
Rev. 6.0% 0 0 0 X
10/1/15 (MBIA
Insured)
Sacramento Calif. -- 3,100,000 3,100,00 3,193,00 3,193,00 78605NA
Pwr. Auth. 0 0 0 C
Cogeneration
Proj. 6% 7/1/00
Sacramento Calif. -- 3,300,000 3,300,00 3,419,62 3,419,62 78605NA
Pwr. Auth. 0 5 5 D
Cogeneration
Proj. 6% 7/1/01
Sacramento Calif. -- 2,000,000 2,000,00 2,127,50 2,127,50 78605NA
Pwr. Auth. 0 0 0 L
Cogeneration
Proj. 6.5% 7/1/08
Sacramento Calif. -- 3,000,000 3,000,00 3,075,00 3,075,00 78605NA
Pwr. Auth. 0 0 0 B
Cogeneration
Proj. Rev. 6%
7/1/99
Sacramento BBB- 1,400,000 1,400,00 1,440,250 1,440,25 785872A
Cogeneration 0 0 D
Auth.
Cogeneration
Proj. Rev.
(Proctor &
Gamble roj.)
5.80%7/1/01
Sacramento Pwr. BBB- 2,000,000 2,000,00 2,140,000 2,140,00 78605NA
Auth. 0 0 H
Cogeneration
Proj. Rev. 6.50%
7/1/05
San Bernardino Baa1 4,000,000 4,000,00 4,005,00 4,005,00 796815N
County Ctfs. of 0 0 0 X
Prtn. Med. Ctr.
Fing. 5.25%
8/1/05
San Bernardino Baa1 3,000,000 3,000,00 2,985,00 2,985,00 796815N
County Ctfs. of 0 0 0 Y
Prtn.(Med. Ctr.
Fing Proj.) 5.25%
8/1/06
San Francisco Aaa 1,700,000 1,700,00 1,693,62 1,693,62 797652S
Calif. City & Cnty. 0 5 5 Q
Arpts. Commn
Intl. Arpt. Rev.
Series 9B, 5.25%
5/1/11 (FGIC
Insured)
San Francisco Aaa 1,000,000 1,000,00 988,750 988,750 797652S
Calif. City & Cnty. 0 R
Arpts. Commn.
Intl. Arpt. Rev.
5.25% 5/1/12
(FGIC Insured)
San Francisco Aaa 4,850,000 4,850,00 5,159,18 5,159,18 797654H
City & County 0 8 8 J
Swr. Rev. Rfdg.
5.90% 10/1/07
(AMBAC Insured)
Southern Aaa 13,820,00 13,820,0 12,230,7 12,230,7 842475J
California Pub. 0 00 00 00 W
Pwr. Auth. Pwr.
Proj. Rev. Series
11, 0% 7/1/15,
(Pre-Prefunded
to 7/1/00 @ 101)
University of Aaa 1,000,000 1,000,00 1,113,750 1,113,75 914113Q
California Revs. 0 0 Z
Rfdg. (Hsg.Sys.)
Series A, 8%
11/1/00
West Covina Ctfs. A2 3,425,000 3,425,00 3,660,46 3,660,46 952358B
of Prtn. (Queen of 0 9 9 Q
the Valley
Hospital) 6.50%
8/15/09
131,251, 116,686,
000 090
COLORADO
Adams & Aaa 2,330,000 2,330,00 2,490,188 2,490,18 005482Z
Arapaho School 0 8 Z
Dist. 5.75%
12/1/07,(FGIC
Insured)
Colorado Health Baa 16,100,00 2,000,000 18,100,0 16,784,2 2,085,000 18,869,2 1964732
Facs. Auth. Rev. 0 00 50 50 L
(Rocky Mountain
Adventist) 6.25%
2/1/04
Colorado Student A 2,650,000 2,650,00 2,739,43 2,739,43 196777G
Oblig. Bond Auth. 0 8 8 E
Student Loan
Rev. Series A,
6.75% 9/1/99
Denver City & Aaa 5,320,000 5,320,00 3,883,600 3,883,60 249181N
Cnty Arpt. Rev. 0 0 C
0%, 10/15/03,
(MBIA Insured)
Denver City & Aaa 2,055,000 2,055,00 1,338,319 1,338,31 249181N
Cnty. Arpt. Rev. 0 9 A
Series D (Cap.
Appreciation) 0%
11/15/05, (MBIA
Insured
Denver City & Aaa 2,660,000 2,660,00 2,899,400 2,899,40 249181N
County Arpt. (OID 0 0 W
Long
Muni.)6.55%
11/15/03 (MBIA
Insured)
Denver City & Aaa 2,250,000 2,250,00 1,465,313 1,465,31 249181M
County Arpt. Rev. 0 3 F
Series A, (Cap.
Appreciation) 0%
11/15/05 (MBIA
Insured) AMT
Denver City & Baa 2,070,000 2,070,00 1,379,137 1,379,13 249181G
County Arpt. Rev. 0 7 Q
Series A, 0%
11/15/04 (AMT)
Denver City & Baa 730,000 730,000 813,950 813,950 249181G
County Arpt. Rev. N
Series A, 8.25%
11/15/02 (AMT)
Denver City & Baa 4,500,000 4,500,00 2,660,625 2,660,62 249181J
County Arpt. Rev. 0 5 F
Series D (Cap.
Appreciation) 0%
11/15/06 (AMT)
42,665,0 38,539,2
00 20
CONNECTICUT
Connecticut BBB- 1,450,000 1,450,00 1,446,244 1,446,24 207742F
Health & Edl. 0 4 5
Facs. Auth. Rev.
(Quinnipiac
College) Series D,
4.90% 7/1/98
Connecticut BBB- 1,100,000 1,100,00 1,102,750 1,102,75 207742F
Health & Edl. 0 0 6
Facs. Auth. Rev.
(Quinnipiac
College) Series D,
5.625% 7/1/03
2,550,00 2,548,99
0 4
DISTRICT OF
COLUMBIA
District of Aaa 4,000,000 4,000,00 4,200,00 4,200,00 254760N
Columbia Gen. 0 0 0 4
Oblig. Rfdg.
Series A, 5.875%
6/1/05 (AMBAC
Insured)
District of Baa1 2,600,000 2,600,00 2,655,25 2,655,25 254764B
Columbia Hosp. 0 0 0 V
Rev. Rfdg.
(Medlantic
Healthcare Group
- - Washington
Hosp. Ctr.) Series
A, 6.75% 8/15/98
District of Baa1 2,600,000 2,600,00 2,697,50 2,697,50 254764B
Columbia Hosp. 0 0 0 W
Rev. Rfdg.
(Medlantic
Healthcare Group
- - Washington
Hosp. Ctr.) Series
A, 6.80% 8/15/99
District of Baa1 4,035,000 4,035,00 4,040,44 4,040,44 254764C
Columbia Hosp. 0 7 7 Y
Rev. Rfdg.
(Medlantic
Healthcare Group
- - Washington
Hosp. Ctr.) Series
B, 5.80% 8/15/97
District of Baa1 4,265,000 4,265,00 4,318,31 4,318,31 254764C
Columbia Hosp. 0 3 3 Z
Rev. Rfdg.
(Medlantic
Healthcare Group
- - Washington
Hosp. Ctr.) Series
B, 6% 8/15/98
District of Baa1 4,805,000 4,805,00 4,967,16 4,967,16 254764D
Columbia Hosp. 0 9 9 B
Rev. Rfdg.
(Medlantic
Healthcare Group
- - Washington
Hosp. Ctr.) Series
B, 6.25% 8/15/00
District of Baa1 4,520,000 4,520,00 4,627,350 4,627,35 254764D
Columbia Hosp. 0 0 A
Rev. Rfdg.
(Medlantic
Healthcare
Group,
Washington
Hosp. Ctr.) Series
B, 6.125%
8/15/99
District of Aaa 1,100,000 1,100,00 1,130,250 1,130,25 254764E
Columbia Hosp. 0 0 N
Rev. Rfdg.
(Medlantic
Healthcare)
Series A, 5.50%
8/15/06, (MBIA
Insured)
District of Aaa 1,140,000 1,140,00 1,189,87 1,189,87 2547606
Columbia Refdg. 0 5 5 J
Series A, 5.75%
6/1/03 (AMBAC
Insured)
District of Aaa 2,155,000 2,155,00 2,251,97 2,251,97 2547606
Columbia Refdg. 0 5 5 H
Series C, 5.75%
12/1/05 (AMBAC
Insured)
District of A1 3,500,000 3,500,00 3,637,58 3,637,58 254839D
Columbia Rev. 0 5 5 E
(Georgetown
Univ.) Series A,
7.25% 4/1/11
District of Aaa 1,000,000 1,000,00 1,000,00 1,000,00 254760K
Columbia Series 0 0 0 5
E, 5% 6/1/04
(FGIC Insured)
35,720,0 36,715,7
00 14
FLORIDA 2,000,000 2,000,00 2,085,000 2,085,00 702538C
0 0 R
Alachua County Baa1 1,750,000 1,750,00 1,844,06 1,844,06 010685F
Health Facs. 0 3 3 T
Auth. Health
Facs. Rev. Rfdg.
(Santa Fe
Healthcare Facs.
Proj.) 6%
11/15/09
Broward County A 3,260,000 655,000 3,915,00 3,549,32 713,131 4,262,45 115064A
Resources 0 5 6 E
Recovery Rev.
(SES Broward
Co. LP South
Proj.) 7.95%
12/1/08
Gainesville Util. Aa 3,500,000 3,500,00 3,517,50 3,517,50 362848H
Sys. Rev. Series 0 0 0 R
B, 5.50% 10/1/13
Hillsborough Aaa 2,000,000 2,000,00 2,170,000 2,170,00 432327D
County Port. Dist. 0 0 J
Spl. Ref. Rev.
(Tampa Port.
Auth.) 6.50%
6/1/02,
(FSAInsured)
AMT
Jacksonville Aaa 2,500,000 2,500,00 2,546,87 2,546,87 469383R
Excise Tax Rev. 0 5 5 M
Series B, 5.60%
10/1/08 (FGIC
Insured)
15,665,0 16,425,8
00 94
GEORGIA 2,475,000 2,475,00 2,682,281 2,682,28 373382V
0 1 E
Fulton Cnty. Ga. Aaa 2,500,000 2,500,00 2,737,50 2,737,50 360066H
Wtr. & Sew. Rev. 0 0 0 L
Rfdg. 6.25%
1/1/06 (FGIC
Insured)
4,975,00 5,419,78
0 1
IDAHO
Idaho Falls Rfdg. Aaa 7,000,000 7,000,00 4,795,00 4,795,00 451182F
0% 4/1/05, (FGIC 0 0 0 B
Insured)
7,000,00 4,795,00
0 0
ILLINOIS
Chicago Gen. Aaa 4,000,000 4,000,00 4,155,000 4,155,00 167484C
Oblig. Series 0 0 B
A-2, 5.50%
1/1/04, (AMBAC
Insured)
Chicago Midway Aaa 2,000,000 2,000,00 2,102,50 2,102,50 167562B
Arpt. Rev. Series 0 0 0 U
B, 6.0% 1/1/09
(MBIA Insured)
AMT
Chicago Midway Aaa 2,740,000 2,740,00 2,859,87 2,859,87 167562B
Arpt. Rev. Series 0 5 5 X
B, 6.125% 1/1/12
(MBIA Insured)
AMT
Chicago Ohare Aaa 9,820,000 9,820,00 10,568,7 10,568,7 167592N
Intl. Arpt. Rev. 0 75 75 V
Rfdg. (Gen. Arpt.
Second Lien)
Series A, 6.25%
1/1/08 (AMBAC
Insured)
Lake County Aa2 5,850,000 5,850,00 4,058,43 4,058,43 508354F
Forest Preserve 0 8 8 N
Dist. 0% 12/1/04
Metropolitan Pier Aaa 4,900,000 4,900,00 5,439,00 5,439,00 592247K
& Expo. Auth. 0 0 0 X
Dedicated State
Tax Rev.
(McCormick
Place Expansion
Proj.) Series A,
6.50% 6/15/07
(FGIC Insured)
Metropolitan Pier Aaa 100,000 100,000 109,375 109,375 592247L
& Exposition C
Auth. Dedicated
State Tax Rev.
(McCormick
Place Expansion
Proj.) Series A,
6.50% 6/15/07
(FGIC Insured)
N IL UNIV FGIC Aaa 1,000,000 1,000,00 1,056,250 1,056,25 665245T
6% 4/1/02 0 0 Z
Rolling Meadows -- 5,000,000 5,000,00 5,306,25 5,306,25 775702B
Multi-Family Mtg. 0 0 0 V
Rev. Rfdg.
(Woodfield
Garden Apts.
Proj.) 7.75%
7.75% 2/1/04,
LOC Banque
Paribas
35,410,0 35,655,4
00 63
INDIANA
Indiana -- 5,000,000 5,000,00 5,093,75 5,093,75 454901A
Employment Dev. 0 0 0 B
Poll. Cont. Rev.
5.70% 10/1/99
Indianapolis Res. Aaa 5,510,000 2,675,000 8,185,00 6,191,86 3,006,031 9,197,89 455356B
Rec. 6.75% 0 3 4 J
12/1/05
(AMBACInsured)
Indianapolis Aaa 4,755,000 4,755,00 5,212,66 5,212,66 455356B
Resource Rec. 0 9 9 G
Rev. Rfdg.
(Ogden Martin
Sys., Inc. Proj.)
6.50% 12/1/03,
(AMBAC Insured)
Indianapolis Aaa 2,195,000 1,325,000 3,520,00 2,452,91 1,480,688 3,933,60 455356B
Resource 0 3 1 H
Recovery Rev.
Rfdg. (Ogden
Martin Sys. Inc.
Proj.) 6.75%
12/1/04, (AMBAC
Insured)
Indianapolis Aaa 3,485,000 3,485,00 3,981,61 3,981,61 455356B
Resource 0 3 3 M
Recovery Rev.
Rfdg. 6.75%
12/1/08 (AMBAC
Insured)
Marion County Aaa 700,000 700,000 718,165 718,165 569037D
Ind. Hosp. Auth. B
Facs. Rev.
(Commty. Hosp.
Indianapolis Proj.)
9.25% 5/1/98
(Escrowed to
Maturity)**
Marion County Aaa 2,220,000 2,220,00 2,411,47 2,411,47 569037J
Ind. Hosp. Auth. 0 5 5 A
Facs. Rev. Rfdg.
(Univ. Heights
Hosp.) 8.625%
10/1/99 (AMBAC
Insured)
27,865,0 30,549,1
00 67
IOWA
Iowa Student Aaa 4,500,000 4,500,00 4,573,125 4,573,12 462590C
Loan Liquidity 0 5 U
Corp. Student
Loan Rev. Rfdg.
Sr. Series B,
5.75% 12/1/07,
(AMT)
Iowa Student Aa1 5,080,000 5,080,00 5,257,80 5,257,80 462590B
Loan Liquidity 0 0 0 S
Corp. Student
Loan Rev. Series
A, 6.25% 3/1/00
9,580,00 9,830,92
0 5
KANSAS
Kansas City Util. Aaa 5,015,000 5,015,00 3,635,87 3,635,87 484790H
Sys. Rev. 0% 0 5 5 J
3/1/04
Kansas City Util. Aaa 3,735,000 3,735,00 2,703,20 2,703,20 484790H
Sys. Rev. 0% 0 6 6 Y
3/1/04
8,750,00 6,339,08
0 1
KENTUCKY
Kentucky 2,000,000 2,000,00 2,070,000 2,070,00 491552G
Turnpike Auth. 0 0 N
Economic Dev.
Rev. Rfdg.
(Revitalization
Project) 5.50%
7/1/09 (AMBAC
Insured)
2,000,00 2,070,00
0 0
LOUISIANA
Louisiana Pub. Aaa 1,500,000 1,500,00 1,548,75 1,548,75 54640AJ
Facs. Auth. Rev. 0 0 0 U
(Student Loan)
Sr. Series A-1,
6.10% 3/1/00
Louisiana Pub. Aaa 3,000,000 3,000,00 3,112,50 3,112,50 54640AJ
Facs. Auth. Rev. 0 0 0 W
(Student Loan)
Sr. Series A-1,
6.10% 9/1/00
New Orleans Aaa 13,500,00 13,500,0 8,977,50 8,977,50 647634X
Gen. Oblig. Cap. 0 00 0 0 Q
Appreciation
Rfdg. 0% 9/1/05,
(AMBAC Insured)
18,000,0 13,638,7
00 50
MARYLAND
Maryland State & Aaa 1,000,000 1,000,00 1,021,250 1,021,25 574192J
Local Facs. First 0 0 K
Series, 5% 3/1/04
Prince George's A 1,250,000 1,250,00 1,354,68 1,354,68 741710A
County Hosp. 0 8 8 J
Rev. (Dimensions
Health Corp.) 7%
7/1/01
Prince George's A 305,000 305,000 339,313 339,313 741710B
County Med. A
Hosp. Rev.
(Dimensions
Health Corp.)
7.20% 7/1/06
Prince George's A 1,130,000 1,130,00 1,121,52 1,121,52 741724A
County Rev. 0 5 5 Y
Rfdg.
(Dimensions
Health Corp.
Proj.) 5% 7/1/05
3,685,00 3,836,77
0 6
MASSACHUSETTS
Boston Rev. Aaa 2,000,000 2,000,00 2,222,50 2,222,50 101026A
(Boston City 0 0 0 P
Hosp.) Series A,
7.625% 2/15/21,
(FHA
Guaranteed)
(FSA Insured)
Lowell Univ. Bldg. Aaa 1,705,000 1,705,00 1,920,25 1,920,25 914397D
Auth. Fifth Series 0 6 6 C
A, 6.75% 11/1/05
(AMBAC Insured)
Massachusetts -- 950,000 950,000 956,793 956,793 575633B
Ed. Loan Auth. L
Ed. Loan Rev.
Issue C, 7.40%
6/1/98, LOC
Rabobank
Nederland
Massachusetts A1 3,500,000 3,500,00 3,635,62 3,635,62 5758233
Gen. Oblig. 0% 0 5 5 Y
12/1/00
Massachusetts A1 2,755,000 2,755,00 2,789,43 2,789,43 5758234
Gen. Oblig. Rfdg. 0 8 8 S
Series A, 5.50%
2/1/11
Massachusetts A1 2,000,000 2,000,00 2,132,50 2,132,50 575823T
Gen. Oblig. Rfdg. 0 0 0 5
Series C, 6.50%
8/1/11
Massachusetts A1 3,500,000 3,500,00 3,675,00 3,675,00 575826H
Gen. Oblig. 0 0 0 R
Series B, 6.0%
8/1/13
Massachusetts A1 4,000,000 4,000,00 4,185,00 4,185,00 575826H
Gen. Oblig. 0 0 0 S
Series B, 6.0%
8/1/14
Massachusetts Baa2 5,715,000 5,715,00 5,986,46 5,986,46 5758504
Health & Edl. 0 3 3 G
Facs. Auth. Rev.
(Lawrence Gen.
Hosp.) Series B,
7.25% 7/1/01
Massachusetts Baa 2,900,000 2,900,00 3,121,12 3,121,12 575850L
Health & Edl. 0 5 5 8
Facs. Auth. Rev.
(Waltham/Weston
Hosp. & Med.
Ctr.) Series B, 8%
7/1/02
Massachusetts -- 1,000,000 1,000,00 1,093,75 1,093,75 575855F
Ind. Fin. Agcy. 0 0 0 4
Ind. Rev. Rfdg.
(Beloit Corp.
Proj.) Series A,
7.60% 12/1/11
Massachusetts A1 10,800,00 10,800,0 8,883,00 8,883,00 575914D
Ind. Fin. Agcy. 0 00 0 0 W
Rev. (Cap.
Appreciation)
(Massachusetts
Biomedical
Research) Series
A-1, 0% 8/1/01
Massachusetts A1 5,700,000 5,700,00 4,446,00 4,446,00 575914D
Ind. Fin. Agcy. 0 0 0 Y
Rev. (Cap.
Appreciation)
(Massachusetts
Biomedical
Research) Series
A-1, 0% 8/1/02
Massachusetts A1 5,100,000 5,100,00 3,378,75 3,378,75 575914E
Ind. Fin. Agcy. 0 0 0 B
Rev. (Cap.
Appreciation)
(Massachusetts
Biomedical
Research) Series
A-2, 0% 8/1/05
Massachusetts -- 5,800,000 5,800,00 3,342,25 3,342,25 575914E
Ind. Fin. Agcy. 0 0 0 D
Rev. (Cap.
Appreciation)
(Massaschusetts
Biomedical
Research) Series
A-2, 0% 8/1/07
Massachusetts A1 10,800,00 10,800,0 7,587,00 7,587,00 575914E
Ind. Fin. Agcy. 0 00 0 0 A
Rev.
(Cap.Appreciation
) (Massachusetts
Biomedical
Research) Series
A-2, 0% 8/1/04
Massachusetts Baa2 3,610,000 3,610,00 3,903,31 3,903,31 575765H
Muni. Wholesale 0 3 3 Z
Elec. Co. Pwr.
Supply Sys. Rev.
Rfdg. Series A,
6.75% 7/1/05
New England Ed. Aaa 3,000,000 3,000,00 3,138,75 3,138,75 643898A
Loan Marketing 0 0 0 X
Corp. Rev. Rfdg.
(Massachusetts
Student Loan) Sr.
Issue D, 6%
9/1/99
New England Ed. Aaa 27,525,00 27,525,0 29,658,1 29,658,1 643898A
Loan Marketing 0 00 88 88 T
Corp. Rev. Rfdg.
(Massachusetts
Student Loan) Sr.
Issue Series A,
6.50% 9/1/02
New England Ed. Aaa 7,815,000 7,815,00 8,342,51 8,342,51 643898A
Loan Marketing 0 3 3 Z
Corp. Student
Loan Rev. Rfdg.
Sr. Issue D,
6.30% 9/1/02
110,175, 104,398,
000 214
MICHIGAN
Detroit A 17,200,00 5,100,000 22,300,0 16,641,0 4,934,250 21,575,2 251131B
Convention Facs. 0 00 00 50 F
Rev. Rfdg. (Cobo
Hall Expansion
Proj.) 5.25%
9/30/12
Michigan Muni. Aaa 1,000,000 1,000,00 1,096,25 1,096,25 59455PF
Auth. Rev. (Local 0 0 0 S
Gov't. Loan Prog.
G) 6.30% 11/1/05
(AMBAC Insured)
Michigan State Aaa 1,195,000 1,195,00 1,272,67 1,272,67 59465EH
Hosp. Fin. Auth. 0 5 5 T
Rev. Mercy
Health Services
Series Q, 6.0%
8/15/09 (AMBAC
Insured)
Michigan -- 5,000,000 5,000,00 5,093,75 5,093,75 594693A
Strategic Fund 0 0 0 N
Poll. Cont. Rev.
(Chrysler Corp.
Proj.) 5.70%
10/1/99
Utica Community Aaa 1,125,000 500,000 1,625,00 1,127,66 501,185 1,628,85 917661S
School Bldg. & 0 6 1 U
Site Rfdg.4.10%
5/1/98 (FGIC
Insured)
31,120,0 30,666,7
00 76
MINNESOTA
Breckenridge -- 305,000 305,000 307,141 307,141 106502A
Hosp. Facs. Rev. K
(Franciscan
Sisters
Healthcare)
Series B1, 8.25%
9/1/97
Minneapolis Rfdg. Aaa 300,000 300,000 223,125 223,125 60374AQ
(Sports Arena Y
Proj.) 0% 12/1/03
Minneapolis Aaa 440,000 440,000 310,200 310,200 60374AQ
Unltd. Tax Series Z
B, (Cap.
Appreciation)
(Sports Arena
Proj.) 0%
12/01/04
Minneapolis Aaa 495,000 495,000 332,887 332,887 60374AR
Unltd. Tax Series A
B, (Cap.
Appreciation)
(Sports Arena
Proj.) 0%
12/01/05
Minnesota Gen. Aaa 1,000,000 1,000,00 1,052,500 1,052,50 604128S
Oblig. Unltd. Tax 0 0 G
5.60% 10/1/02
2,540,00 2,225,85
0 3
MISSOURI
Missouri Hsg. Aa 13,310,00 13,310,0 615,588 615,588 606353Q
Dev. Commission 0 00 5
(Cap.
Appreciation) 0%
9/1/25, (FHA
Insured)
13,310,0 615,588
00
NEBRASKA
Nebraska Aaa 2,000,000 2,000,00 2,185,00 2,185,00 639902B
Investment Fin. 0 0 0 K
Auth. Hosp. Rev.
(Nebraska
Methodist Health
Sys.) 6.85%
3/1/02, (MBIA
Insured)
Nebraska Pub. A1 2,000,000 2,000,00 1,950,00 1,950,00 639683M
Pwr. Dist. Rev. 0 0 0 7
Rfdg. (Pwr.
Supply Sys.)
Series B, 5.25%
1/1/13
4,000,00 4,135,00
0 0
NEVADA
Clark County Aaa 6,195,000 6,195,00 4,259,06 4,259,06 181054U
School Dist. Ltd. 0 3 3 Z
Tax Series B, 0%
3/1/05, (FGIC
Insured)
6,195,00 4,259,06
0 3
NEW HAMPSHIRE
New Hampshire -- 290,000 290,000 293,202 293,202 644618H
Higher Ed. & X
Health Facs.
Auth. Rev.
(Androscoggin
Valley Hosp.)
Series A, 7.90%
11/1/98, (GNMA
Coll.)
New Hampshire Baa 4,145,000 4,145,00 4,191,631 4,191,63 644618N
Higher Ed. & 0 1 2
Health Facs.
Auth. Rev.
(Frisbee Mem.
Hosp.) 5.70%
10/1/04
4,435,00 4,484,83
0 3
NEW JERSEY
New Jersey Eda. Aaa 5,000,000 5,000,00 5,593,75 5,593,75 645910A
Mkt. Transition 0 0 0 G
Facs. Rev. Sr.
Lien Series A, 7%
7/1/03, (MBIA
Insured)
New Jersey A3 2,750,000 2,750,00 2,949,37 2,949,37 64579CL
Health Care Facs. 0 5 5 E
Fin. Auth. Rev.
Rfdg. (Atlantic
City Med. Ctr.)
Series C, 6.80%
7/1/05
New Jersey A3 2,200,000 2,200,00 2,334,75 2,334,75 64579CL
Health Care Facs. 0 0 0 B
Fin. Auth. Rfdg.
(Atlantic City
Med. Ctr.) Series
C, 6.55% 7/1/03
New Jersey Aaa 4,500,000 4,500,00 4,651,87 4,651,87 646131A
Trans. Corp. 0 5 5 J
Series A, 5.40%
9/1/02 (FSA
Insured)
Passaic County Aaa 3,380,000 3,380,00 2,729,350 2,729,35 702766A
Util. Auth. Swr. 0 0 X
Dev. Rev. 0%
3/1/02 (MBIA
Insured)
17,830,0 18,259,1
00 00
NEW YORK
Metropolitan Baa1 5,280,000 5,280,00 5,299,80 5,299,80 592597F
Trans. Auth. Svc. 0 0 0 9
Contract (Trans.
Facs.) Rfdg.
Series 7, 5.20%
7/1/04
Muni. Assistance Aa 3,500,000 3,500,00 3,758,125 3,758,12 626190G
Corp. for New 0 5 6
York City 6%
7/1/05
Muni. Assistance Aa2 4,000,000 4,000,00 4,290,00 4,290,00 626190G
Corp. for New 0 0 0 5
York City Series
E, 6% 7/1/04
Muni. Assistance Aa2 2,750,000 2,750,00 2,860,00 2,860,00 626190U
Corp. of New York 0 0 0 6
City Refdg.
Series J, 5.50%
7/1/02
New York City Baa1 1,775,000 1,775,00 2,163,28 2,163,28 649654G
Gen. Oblig. 0 1 1 H
Series B, 8.25%
6/1/07
New York City Baa1 5,000,000 5,000,00 5,500,00 5,500,00 649652J
Gen. Oblig. 0 0 0 Z
Series B, 7.50%
2/1/04
New York City Baa1 3,000,000 3,000,00 3,187,50 3,187,50 649652M
Gen. Oblig. 0 0 0 V
Series C, 6.40%
8/1/03
New York City Baa1 13,885,00 13,885,0 14,093,2 14,093,2 649664H
Gen. Oblig. 0 00 75 75 N
Series G, 5.4%
2/1/01
New York City Baa1 3,000,000 3,000,00 3,273,75 3,273,75 649653L
Gen. Oblig. 0 0 0 A
Series H, 7%
2/1/06
New York City Baa1 2,620,000 2,620,00 2,898,37 2,898,37 649653J
Gen. Oblig. Unltd. 0 5 5 L
Tax. Series B,
7.50% 2/1/05
New York State Baa1 2,445,000 2,445,00 2,460,28 2,460,28 650017A
Tollway Auth. Svc. 0 1 1 L
Contract Rev.
(Local Hwy. &
Bridges) 6%
1/1/11
New York State Baa1 3,000,000 3,000,00 3,056,25 3,056,25 649834H
Dorm Auth. Rev. 0 0 0 V
(City Univ. Sys.
Consolidated)
Series A, 5.75%
7/1/13
New York State Baa1 1,700,000 1,700,00 1,978,37 1,978,37 649832J
Dorm Auth. Rev. 0 5 5 C
(City Univ. Sys.
Consolidated)
Series D, 8.75%
7/1/02
New York State Baa1 1,080,000 1,080,00 1,116,450 1,116,45 649834H
Dorm. Auth. Rev. 0 0 D
(City Univ. Sys.)
Series B, 5.75%
7/1/06
New York State Baa1 2,500,000 2,500,00 2,981,25 2,981,25 649832D
Dorm. Auth. Rev. 0 0 0 G
(City Univ. Sys.)
Series C, 7.50%
7/1/10
New York State Baa1 4,185,000 4,185,00 4,221,61 4,221,61 649834V
Dorm. Auth. Rev. 0 9 9 N
(New State Univ.
Edl. Facs.) Series
C, 5.20% 5/15/04
New York State Baa1 3,500,000 3,500,00 3,618,12 3,618,12 649834G
Dorm. Auth. Rev. 0 5 5 V
(New York City
Univ.) 5.70%
7/1/05
New York State Baa1 2,000,000 2,000,00 1,992,50 1,992,50 649834V
Dorm. Auth. Rev. 0 0 0 Q
(New York State
Univ. Edl. Facs.)
Series A, 5.20%
5/15/06
New York State Baa1 1,670,000 1,670,00 1,651,21 1,651,21 649834M
Dorm. Auth. Rev. 0 3 3 Z
Rfdg. (State Univ.
Ed. Facs.) Series
B, 5.25% 5/15/09
New York State Baa1 2,000,000 2,000,00 1,952,50 1,952,50 649834N
Dorm. Auth. Rev. 0 0 0 B
rfdg. (State Univ.
Edl. Facs.) Series
B, 5.25% 5/15/11
New York State Baa1 1,800,000 1,800,00 1,856,25 1,856,25 6496644
Gen. Oblig. Rfdg. 0 0 0 M
Series A, 5.70%
8/1/02
New York State Aaa 3,400,000 3,400,00 3,536,00 3,536,00 649876S
Local Gov't. 0 0 0 C
Assistance Corp.
Refdg. Series A,
5.50% 4/1/04
(AMBAC Insured)
New York State A3 2,500,000 2,500,00 2,553,12 2,553,12 649876F
Local Gov't. 0 5 5 Y
Assistance Corp.
Series B, 6%
4/1/18
New York State A3 3,000,000 3,000,00 3,101,25 3,101,25 650013A
Thruway Auth. 0 0 0 Q
Hwy. & Bridge
Trust Fund Series
A, 5.80% 4/1/09
New York State Baa1 1,100,000 1,100,00 1,098,62 1,098,62 6500334
Urban Dev. Corp. 0 5 5 T
Rev. Rfdg.
(Syracuse Univ.
Ctr.) 5.1% 1/1/02
New York State Baa1 1,785,000 1,785,00 1,918,875 1,918,87 650033D
Urban Dev. Corp. 0 5 9
Rev.
Rfdg.(Correctiona
l Cap. Facs.)
Series A, 6.40%
1/1/04
New York City 2,000,000 2,000,00 2,117,500 2,117,50 649654M
Gen. Oblig. 0 0 T
Series C, 6.50%
8/1/07
84,475,0 88,534,2
00 94
NORTH CAROLINA
North Carolina Baa1 1,000,000 1,000,00 1,018,750 1,018,75 658196N
Eastern Muni 0 0 L
5.625% 1/1/03
North Carolina Baa1 500,000 500,000 501,250 501,250 658196T
Eastern Muni B
Pwr. Agcy. Pwr.
Sys. Rev. Rfdg.
Series C, 5.5%
1/1/07
North Carolina Baa1 5,750,000 5,750,00 5,972,81 5,972,81 658196N
Eastern Muni. 0 3 3 S
Pwr. Agcy. Pwr.
Sys. Rev. Rfdg.
Series B, 6%
1/1/06
North Carolina Baa1 9,340,000 9,340,00 9,304,97 9,304,97 658196S
Eastern Muni. 0 5 5 S
Pwr. Agcy. Pwr.
Sys. Rev. Rfdg.
Series C, 5.25%
1/1/04
North Carolina AAA 1,000,000 1,000,00 1,070,000 1,070,00 657903E
Edl. Facs. Fin. 0 0 Y
Agcy. Rev. Rfdg.
(Elon College
Proj.) 6.375%
1/1/07 (Connie
Lee Insured)
17,590,0 17,867,7
00 88
NORTH DAKOTA
North Dakota St. Aaa 2,100,000 2,100,00 2,198,11 2,198,11 659005C
Student Loan 0 2 2 W
Rev. Series A,
7.75% 7/1/02
(AMBAC Insured)
2,100,00 2,198,11
0 2
NEW MEXICO
Albuquerque Arpt. Aaa 1,400,000 1,400,00 1,552,250 1,552,25 013538E
Rev. Rfdg. 6.50% 0 0 S
7/1/07, (AMBAC
Insured)
Farmington Aaa 1,300,000 1,300,00 1,306,318 1,306,31 311450D
Pollution Cont. 0 8 A
Rev. 6.1% 1/1/08
(MBIA Insured)
New Mexico Edl. A 4,835,000 4,835,00 5,173,450 5,173,45 647111D
Assistance 0 0 G
Foundation
Student Loan
Rev. Sr. Series IV
A-1 7.05%
3/1/10AMT
Rio Rancho Wtr. Aaa 1,420,000 1,420,00 1,680,925 1,680,92 767175A
& Wastewtr. Sys. 0 5 H
Rev. Series A, 8%
5/15/04, (FSA
Insured)
8,955,00 9,712,94
0 3
OHIO
Cincinnata 1,035,000 1,035,00 1,082,868 1,082,86 863869B
Student Loan 0 8 F
Funding Corp.
Rev. Rfdg. Series
C, 6.20% 7/1/03
(AMT)
Franklin County -- 500,000 340,000 840,000 513,125 348,925 862,050 353202B
Rev. (OCLC H
Online Computer
Library Ctr. Inc.
Proj.) 5.65%
4/15/01
Franklin County -- 1,030,000 1,030,00 1,066,05 1,066,05 353202B
Rev. (OCLC 0 0 0 J
Online Computer
Library Ctr. Proj.)
5.75% 4/15/02
Franklin County -- 500,000 500,000 520,625 520,625 353202B
Rev. (OCLC L
Online Computer
Library Ctr. Proj.)
5.90% 4/15/04
Franklin County -- 745,000 745,000 760,317 760,317 353202A
Rev. (OCLC T
Online Computer
Library Ctr.)
Series 1991,
6.50% 7/15/98
Franklin County -- 895,000 895,000 927,444 927,444 353202A
Rev. (OCLC U
Online Computer
Library Ctr.)
Series 1991,
6.60% 7/15/99
Franklin County -- 960,000 960,000 1,010,40 1,010,40 353202A
Rev. (OCLC 0 0 V
Online Computer
Library Ctr.)
Series 1991,
6.70% 7/15/00
Franklin County -- 800,000 800,000 856,000 856,000 353202A
Rev. (OCLC W
Online Computer
Library Ctr.)
Series 1991,
6.80% 7/15/01
Franklin County -- 4,500,000 4,500,00 4,612,50 4,612,50 353202B
Rev. (OCLC 0 0 0 M
Online Computer
Library Proj.) 6%
4/15/09
Franklin County -- 560,000 560,000 562,218 562,218 353202B
Rev. (Online E
Computer Library
Inc. Proj.) 5%
4/15/98
Lake County Aaa 3,800,000 3,800,00 4,099,25 4,099,25 509438D
Hosp. Impt. Facs. 0 0 0 M
Rev. (Lake Hosp.
Sys. Inc.) 6.875%
8/15/11, (AMBAC
Insured)
Ohio Bldg. Auth. A1 2,000,000 2,000,00 2,142,500 2,142,50 677553X
6.30% 10/1/11 0 0 4
Ohio Bldg. Auth. Aaa 1,585,000 1,585,00 1,715,763 1,715,76 67755AL
Facs. (Transn. 0 3 N
Bldg. Fund Proj.)
Series A, 6%
9/1/06 (AMBAC
Insured)
Ohio Tpk. Aaa 1,250,000 1,250,00 1,273,43 1,273,43 67760HB
Commty. Rev. 0 8 8 P
Series A, 5.60%
2/15/12 (MBIA
Insured)
20,500,0 21,491,4
00 23
OKLAHOMA
Grand River Dam A 3,890,000 3,890,00 4,458,91 4,458,91 386442P
Auth. Rev. Rfdg. 0 3 3 L
8% 6/1/02
Tulsa Arpt. Impt. Aaa 1,000,000 1,000,00 1,132,500 1,132,50 899647C
Trust Gen. Rev. 0 0 S
(Tulsa Intl. Arpt.)
7% 6/1/13, (MBIA
Insured)
(Pre-Refunded to
6/1/02 @ 100)
Tulsa Ind. Auth. -- 2,080,000 2,080,00 2,314,00 2,314,00 899652B
Hosp. Rev. (Tulsa 0 0 0 V
Reg'l. Med. Ctr.)
7% 6/1/06
6,970,00 7,905,41
0 3
PENNSYLVANIA
Allegheny County Aaa 21,000,00 21,000,0 23,362,5 23,362,5 017285N
Gen. Oblig. 0 00 00 00 9
Series C-34, 0%
2/15/02 stepped
coupon
Delaware County Aa 5,500,000 5,500,00 4,056,25 4,056,25 246001Q
Unltd. Tax Rfdg. 0 0 0 P
0% 11/15/03
Northampton -- 2,305,000 2,305,00 2,382,79 2,382,79 663542C
County Hosp. 0 4 4 H
Auth. Rev.
(Easton Hosp.)
Series B, 6.90%
1/1/02
Philadelphia Aaa 3,610,000 3,610,00 3,871,72 3,871,72 717813A
6.25% 5/5/12 0 5 5 S
(MBIA Insured)
Philadelphia Baa1 2,290,000 2,290,00 2,295,56 2,295,56 717903Q
Hosp. & Higher 0 5 5 Q
Ed. Facs. Auth.
Hosp. Rev.
(Temple Univ.
Hosp.) Series A,
5.40% 11/15/97
Philadelphia Baa1 2,100,000 2,100,00 2,126,250 2,126,25 717903Q
Hosp. & Higher 0 0 S
Ed. Facs. Auth.
Hosp. Rev.
(Temple Univ.
Hosp.) Series A,
5.60% 11/15/98
Philadelphia Baa1 2,675,000 2,675,00 2,731,84 2,731,84 717903Q
Hosp. & Higher 0 4 4 U
Ed. Facs. Auth.
Hosp. Rev.
(Temple Univ.
Hosp.) Series A,
5.75% 11/15/99
Philadelphia Wtr. Aaa 3,300,000 3,300,00 3,444,37 3,444,37 717893A
& Wastewtr. 0 5 5 J
5.50% 6/15/03
(FGIC Insured)
42,780,0 44,271,3
00 03
RHODE ISLAND
Rhode Island A 2,340,000 2,340,00 2,451,15 2,451,15 762315A
Student Loan 0 0 0 N
Auth Student
Loan Rev. Rfdg.
Series A, 6.40%
12/1/99
2,340,00 2,451,15
0 0
SOUTH CAROLINA
Aiken County -- 1,500,000 1,500,00 1,651,87 1,651,87 008760A
Hosp. Ind. Rev. 0 5 5 X
Rfdg. (Beloit
Corp. Proj.)
7.60% 12/1/11
South Carolina 1,000,000 1,000,00 1,033,750 1,033,75 837107M
State Highway 0 0 T
Gen. Oblig.
Series B, 5.625%
7/1/11
South Carolina A 2,000,000 2,000,00 2,055,000 2,055,00 837114F
Ed. Assistance 0 0 R
Auth. Rev. Rfdg.
Guaranteed
(Student Loan)
(Sublien) Series
B, 5.70% 9/1/05
(AMT)
4,500,00 4,740,62
0 5
SOUTH DAKOTA
South Dakota A+ 5,000,000 5,000,00 5,168,750 5,168,75 83756EA
Student Loan 0 0 L
Fing. Corp.
Student Loan
Rev. Series A,
6.15% 8/1/03
5,000,00 5,168,75
0 0
TENNESSEE
Memphis-Shelby Aaa 1,405,000 1,405,00 1,441,88 1,441,88 586111E
Cnty. Arpt. Auth. 0 1 1 D
Rev. Rfdg. Series
A, 5.50% 2/15/03
(MBIA Insured)
Memphis-Shelby Aaa 1,000,000 1,000,00 1,063,75 1,063,75 586111E
Cnty. Arpt. Auth. 0 0 0 H
Rev. Rfdg. Series
A, 6.0% 2/15/07
Memphis-Shelby Aaa 2,000,000 2,000,00 2,122,50 2,122,50 586111E
County Arpt. 0 0 0 G
Auth. Rev. Refdg.
Series A, 6%
2/15/06 (MBIA
Insured)
Memphis General Aa 1,585,000 1,585,00 1,723,688 1,723,68 586145B
Obligation 6% 0 8 H
11/1/06
Shelby County 2,200,000 2,200,00 1,039,500 1,039,50 821685H
Gen. Oblig. 0 0 4
Series A, 0%
5/1/11(Pre-refun
ded to 5/1/05 @
69.561)
8,190,00 7,391,31
0 9
TEXAS
Alief Independent Aaa 1,125,000 1,125,00 1,255,781 1,255,78 016248Q
School Dist. 0 1 7
Unltd. Tax 7%
2/15/03, (PSF
Guaranteed)
Alief Independent Aaa 1,125,000 1,125,00 1,272,656 1,272,65 016248Q
School Dist. 0 6 8
Unltd. Tax 7%
2/15/04, (PSF
Guaranteed)
Allen Independent Aaa 1,370,000 1,370,00 892,212 892,212 018105W
School Dist. 0% 0 D
2/15/06 (PSF
Guaranteed)
Arlington Aaa 1,570,000 1,570,00 967,513 967,513 041826C
Independent 0 Z
School Dist. 0%
2/15/07 (PSF
Guaranteed)
Arlington Aaa 1,000,000 1,000,00 1,078,750 1,078,75 041826E
Independent 0 0 F
School Dist. Rfdg.
& Impt. Unltd. Tax
6.50% 2/15/02,
(PSF
Guaranteed)
Arlington Aaa 1,500,000 1,500,00 1,636,875 1,636,87 041826E
Independent 0 5 G
School Dist. Rfdg.
& Impt. Unltd. Tax
6.50% 2/15/03,
(PSF
Guaranteed)
Austin Util. Sys. Aaa 16,130,00 16,130,0 12,843,5 12,843,5 0524734
Rev. Rfdg. Series 0 00 13 13 U
A, 0% 5/15/02,
(MBIA Insured)
Brazos Higher Aaa 6,750,000 6,750,00 6,952,500 6,952,50 106238D
Ed. Auth. Student 0 0 U
Loan Rev. Rfdg.
Series C-1,
5.60% 6/1/03
Brazos Higher Aaa 2,500,000 2,500,00 2,587,500 2,587,50 106238D
Ed. Auth. Student 0 0 V
Loan Rfdg. Series
C-1, 5.70%
6/1/04
Brazosport Indpt. Aaa 1,290,000 1,290,00 1,293,225 1,293,22 106241H
School Dist. 0 5 Y
Unltd. Tax
(School House)
5.40% 2/15/13
Cedar Hill Aaa 2,830,000 2,830,00 1,896,100 1,896,10 150429Q
Independent 0 0 H
School Dist. 0%
8/15/05
Cedar Hill Aaa 1,465,000 1,465,00 871,675 871,675 150429Q
Independent 0 K
School Dist. 0%
8/15/07
Conroe A3 500,000 500,000 308,125 308,125 208417H
Independent 9
School Dist.
Untld. Tax (Cap.
Appreciation)
10/22/97
Dallas County Aaa 7,125,000 7,125,00 4,800,46 4,800,46 2346495
Rfdg. Unltd. Tax 0 9 9 B
Series A, 0%
8/15/05
Dallas County Aaa 6,700,000 6,700,00 4,279,62 4,279,62 2346495
Rfdg. Unltd. Tax 0 5 5 D
Series A, 0%
8/15/06
Dallas County Aaa 3,605,000 3,605,00 2,181,02 2,181,02 2346495
Rfdg. Unltd. Tax 0 5 5 F
Series A, 0%
8/15/07
Dallas Aaa 500,000 500,000 300,625 300,625 2353075
Independent W
School Dist.
Unltd. Tax Rfdg.
(Cap.
Appreciation) 0%
8/15/07
(PSFInsured)
Eanes Aaa 2,005,000 2,005,00 1,423,55 1,423,55 270083U
Independent 0 0 0 Q
School Dist.
Rfdg.(Cap
Appreciation) 0%
8/1/04 (PSF
Guaranteed)
Harris County Aa3 16,275,00 16,275,0 10,883,0 10,883,0 414003T
Cap. Appreciation 0 00 06 06 G
Rev. Rfdg. (Toll
Road
Subordinated
Lien) 0% 8/1/05
Harris County Aa3 8,485,000 8,485,00 6,671,33 6,671,33 414003T
Cap. Appreciation 0 1 1 C
Rev. Rfdg. (Toll
Road
Subordinated
Lien) Series
1991, 0% 8/1/02
Harris County Aa3 12,570,00 12,570,0 9,380,36 9,380,36 414003T
Cap. Appreciation 0 00 3 3 E
Rev. Rfdg. (Toll
Road
Subordinated
Lien) Series
1991, 0% 8/1/03
Harris County Aaa 11,890,00 11,890,0 9,764,66 9,764,66 414003U
Gen. Oblig. 0% 0 00 3 3 M
10/1/01
Harris County Toll Aa3 13,000,00 13,000,0 8,238,75 8,238,75 414003T
Road Sub-Lien 0 00 0 0 H
Rev. Rfdg. (Cap.
Appreciation) 0%
8/1/06
Houston Wtr. & Aaa 36,000,00 36,000,0 41,805,0 41,805,0 442436C
Swr. Sys. Rev. 0 00 00 00 W
Rfdg. (Jr. Lien)
0% 12/1/15,
(FGIC Insured)
(Pre-Refunded to
12/1/00 @ 103)
stepped coupon
Humble TX Indpt. Aaa 1,300,000 1,300,00 1,564,87 1,564,87 445042X
Sch. Dist. 8% 0 5 5 J
2/15/05 (PSF
Guaranteed)
Katy Independent Aaa 2,550,000 2,550,00 1,571,43 1,571,43 486062P
School Dist. Rfdg. 0 8 8 R
Ltd. Tax Series A,
0% 2/15/07, (PSF
Guaranteed)
Keller Aaa 1,590,000 1,590,00 705,563 705,563 487692V
Independent 0 K
School Dist.
Unltd. Tax Rfdg.
Series A, (Cap.
Appreciation) 0%
8/15/12, (PSF
Guaranteed)
Laredo Gen. Aaa 1,335,000 1,335,00 1,311,63 1,311,63 516823F
Oblig. Rfgd. 0 8 8 S
5.25% 2/15/13,
(FGIC Insured)
Leander Aaa 500,000 500,000 585,000 585,000 521840R
Independent X
School Dist.
Unltd. Tax 7.50%
8/15/04 (PSF
Guaranteed)
Leander Aaa 600,000 600,000 709,500 709,500 521840R
Independent Y
School Dist.
Unltd. Tax 7.50%
8/15/05 (PSF
Guaranteed)
Leander Aaa 800,000 800,000 957,000 957,000 521840R
Independent Z
School Dist.
Unltd. Tax 7.50%
8/15/06 (PSF
Guaranteed)
Leander Aaa 800,000 800,000 967,000 967,000 521840S
Independent A
School Dist.
Unltd. Tax 7.50%
8/15/07 (PSF
Guaranteed)
Lewisville Aaa 5,000,000 5,000,00 2,781,25 2,781,25 5288272
Independent 0 0 0 D
School Dist. Gen.
Oblig. Rfdg. 0%
8/15/08, (PSF
Guaranteed)
Lower Colorado Aaa 615,000 615,000 341,325 341,325 548100X
River Auth. Rev. L
Rfdg. (Cap.
Appreciation) 0%
1/1/09, (MBIA
Insured)
(Escrowed to
Maturity)
Midlothian Indpt. Aaa 1,905,000 1,905,00 1,240,631 1,240,63 597851K
School Dist. 0 1 Z
Unltd. Tax Rfdg.
(Cap.
Appreciation) 0%
2/15/06, (PSF
Guaranteed)
Northside Aaa 1,000,000 1,000,00 803,750 803,750 6670264
Independent 0 E
School Dist. Rfdg.
(Cap.
Appreciation) 0%
2/15/02, (PSF
Guaranteed)
Northside Aaa 1,230,000 1,230,00 939,413 939,413 6670264
Independent 0 F
School Dist. Rfdg.
(Cap.
Appreciation) 0%
2/15/03, (PSF
Guaranteed)
Northside Aaa 6,155,000 6,155,00 4,231,56 4,231,56 6670263
Independent 0 3 3 N
School Dist. Rfdg.
0% 2/1/05, (PSF
Guaranteed)
Round Rock Aaa 7,645,000 7,645,00 4,711,23 4,711,23 779239L
Independent 0 1 1 5
School Dist. Rfdg.
Unltd. Tax 0%
2/15/07, (PSF
Guaranteed)
Round Rock Aaa 1,325,000 1,325,00 1,490,625 1,490,62 779239U
Independent 0 5 4
School Dist.
Unltd. Tax Series
B, 7% 8/1/03
(PSF
Guaranteed)
San Antonio Elec. AA 2,845,000 2,845,00 3,005,03 3,005,03 796253F
& Gas Rev. Rfdg. 0 1 1 L
5.75%
2/1/11(Pre-Refun
ded 2/1/02 @
101)
San Antonio Elec. Aa1 4,155,000 4,155,00 4,238,00 4,238,00 796253G
& Gas Rev. Rfdg. 0 0 0 A
5.75% 2/1/11
San Antonio Gen. Aa 1,000,000 1,745,000 2,745,00 1,013,75 1,768,995 2,782,74 796236J
Impt. Rfdg. 5.50% 0 0 5 H
8/1/04
San Antonio Gen. Aa 2,210,000 2,210,00 2,298,40 2,298,40 796236J
Impt. Rfdg. 6.0% 0 0 0 M
8/1/08
Socorro Aaa 3,000,000 3,000,00 2,122,500 2,122,50 833714Q
Independent 0 0 K
School Dist. Rfdg.
Unltd. Tax 0%
9/1/04, (PSF
Guaranteed)
Spring Branch Aaa 1,000,000 1,000,00 1,078,75 1,078,75 8494753
Independent 0 0 0 Q
School Dist. Rfdg.
6.5% 2/1/02,
(PSF
Guaranteed)
Spring Aaa 5,900,000 5,900,00 3,635,87 3,635,87 850000M
Independent 0 5 5 Z
School Dist. Rfdg.
Unltd. Tax 0%
2/15/07, (PSF
Guaranteed)
Texas Gen. Oblig. Aa 2,350,000 2,350,00 2,444,000 2,444,00 882716Y
5.80% 8/1/05 0 0 S
Texas Muni. Pwr. A1 500,000 500,000 504,100 504,100 882555E
Agcy. Rev. Rfdg. P
9% 9/1/97,
(Escrowed to
Maturity)
Texas Pub. Fin. Aa 3,375,000 3,375,00 3,227,34 3,227,34 882716Y
Auth. Series A, 0 4 4 3
5% 10/1/14
Texas State Pub. Aaa 3,380,000 3,380,00 3,308,17 3,308,17 88275MF
Fin. Auth. Bldg. 0 5 5 L
Rev. Series A,
5.125% 8/1/11
(AMBAC Insured)
Ysleta Aaa 1,100,000 1,100,00 518,375 518,375 988168R
Independent 0 7
School Dist. Rfdg.
Unltd. Tax (Cap.
Appreciation) 0%
8/15/11,
(PSFGuaranteed)
Intermountain 224,220, 187,659,
Pwr. Agcy. Pwr. 000 929
Supply Rev.
Refdg. Series D,
5% 7/1/21 (MBIA
Insured)
UTAH
Intermountain 2,400,000 600,000 3,000,00 2,211,00 552,750 2,763,75 45884AF
Pwr. Agcy. Pwr. 0 0 0 E
Supply Rev.
Refdg. Series D,
5% 7/1/21 (MBIA
Insured)
Intermountain Aaa 1,000,000 1,000,00 1,007,500 1,007,50 45884AH
Pwr. Agcy. Pwr. 0 0 C
Supply Rev. Rfdg.
Series B, 5.75%
7/1/16 (MBIA
Insured)
Intermountain Aaa 17,000,00 17,000,0 17,467,5 17,467,5 458840L
Pwr. Agcy. Pwr. 0 00 00 00 D
Supply Rev. Rfdg.
Series G, 0%
7/1/12,
(Pre-Refunded to
1/1/03 @ 101) ++
stepped coupon
Intermountain Aaa 565,000 565,000 635,625 635,625 45884AF
Pwr. Agcy. Pwr. R
Supply Rev.
Series A, 6.50%
7/1/08 (AMBAC
Insured)
Intermountain Aaa 1,000,000 1,000,00 1,120,00 1,120,00 45884AF
Pwr. Agcy. Pwr. 0 0 0 T
Supply Rev. Spl.
Oblig. Sixth
Series B, 6.50%
7/1/10, (AMBAC
Insured)
Jordan School Aa3 1,000,000 1,000,00 1,167,50 1,167,50 480772F
Dist. 7.625% 0 0 0 H
6/15/04
Salt Lake County Aaa 3,500,000 3,500,00 2,200,61 2,200,61 795697C
Wtr. Conservancy 0 0 0 M
Dist. Rev. (Cap.
Appreciation)
Series A, 0%
10/1/06, (AMBAC
Insured)
Utah Board of Aaa 4,900,000 4,900,00 5,236,87 5,236,87 917546B
Regents Student 0 5 5 L
Loan Series A,
7.60% 11/1/00,
(AMBAC Insured)
31,965,0 31,599,3
00 60
VIRGINIA
Chesapeake Gen.
Oblig. Pub. Impt.
6% 5/1/11
VA TRANS 6.75% Aa 2,400,000 2,400,00 2,544,00 2,544,00 165321M
5/15/03 0 0 0 8
VA TRANS 6.75% Aa 1,895,000 1,895,00 2,091,606 2,091,60 928184G
5/15/04 0 6 P
Virginia Hsg. Dev. Aa 2,020,000 2,020,00 2,252,300 2,252,30 928184G
Auth. MultiFamiliy 0 0 Q
Hsg. Series I,
5.85% 5/1/08
Virginia State Aa1 1,370,000 1,370,00 1,402,538 1,402,53 92813AY
Multi-Family Hsg. 0 8 H
Dev. Auth.Series
I, 5.75% 5/1/07
Aa1 1,380,000 1,380,00 1,411,05 1,411,05 92813AY
0 0 0 G
9,065,00 9,701,49
0 4
WASHINGTON
Washington Gen. 660,000 660,000 673,200 673,200 2547606
Oblig. 5.40% F3
6/1/05 (AMBAC
Insured)
Washington Gen. 775,000 775,000 788,563 788,563 2547606
Oblig. Series G1
96-A, 5.30%
6/1/04
Washington Pub. Aa 1,500,000 1,500,00 1,676,25 1,676,25 939744R
Pwr. Supply Sys. 0 0 0 K
(Nuclear Proj. #2)
Rev. 5% 7/1/09
(MBIA Insured)
Washington Pub. Aaa 5,000,000 5,000,00 4,881,25 4,881,25 939828T
Pwr. Supply Sys. 0 0 0 J
Nuclear Proj. #2
Rev. (Washington
Pub. Pwr. Supply
Sys. Proj.) 7.50%
7/1/03
Washington Pub. Aa1 1,000,000 1,000,00 1,100,00 1,100,00 939828M
Pwr. Supply Sys. 0 0 0 P
Nuclear Proj. #3
Rev. Rfdg. Series
B, 0% 7/1/05,
(MBIA Insured)
Washington Pub. Aaa 10,000,00 10,000,0 6,687,50 6,687,50 939830M
Pwr. Supply Sys. 0 00 0 0 A
Nuclear Proj. #3
Rev. Series B, 0%
7/1/04, (MBIA
Insured)
Washington Pub. Aaa 5,450,000 5,450,00 3,855,87 3,855,87 939830L
Pwr. Supply Sys. 0 5 5 U
Nuclear Proj. #3
Rev. Rfdg. Series
B, 0% 7/1/10
Washington State Aa1 16,000,00 16,000,0 7,640,00 7,640,00 939830H
Pub. Pwr. Supply 0 00 0 0 M
Rev. Rfdg.
(Nuclear Proj. #3)
Series C, 7.50%
7/1/08, (MBIA
Insured)
Washington State Aaa 6,940,000 6,940,00 8,258,60 8,258,60 939830P
Pub. Pwr. Supply 0 0 0 V
Sys. Nuclear #3
Rev. Rfdg. Series
B, 0% 7/1/07
Washington State Aa1 11,000,00 4,000,000 15,000,0 6,421,25 2,335,000 8,756,25 939830G
Pub. Pwr. Supply 0 00 0 0 Q
Sys. Nuclear #3
Rev. Rfdg. Series
B, 0% 7/1/07
Aa1 2,250,000 2,250,00 1,074,375 1,074,37 939830J
0 5 P
64,575,0 45,391,8
00 63
WISCONSIN
Beloit Ind. Dev. -- 1,000,000 1,000,00 1,063,50 1,063,50 080644A
Rev. Rfdg. (Beloit 0 0 0 D
Corp. Proj.) 7%
12/1/01
1,000,00 1,063,50
0 0
TOTAL 1,163,58 1,059,42
MUNICIPAL 6,000 4,798
BONDS
MUNICIPAL
NOTES
FLORIDA
Florida Hsg. Fin. -- 600,000 600,000 600,000 600,000 3407375
Agency T
Multi-Family Hsg.
Rev.
(Brandon-Oxford)
Series 90C,
4.20%, VRDN
ILLINOIS
Illinois Dev. Fin. -- 1,000,000 1,000,00 1,000,00 1,000,00 451915A
Auth. 0 0 0 Q
Multi-Family Hsg.
Rev. Rfdg.
(Garden Glen
Apts.) Series 93,
4.50%, VRDN
TOTAL 1,600,00 1,600,00
MUNICIPAL 0 0
NOTES
MUNICIPAL -- 20,901,58 6,679,903 27,581,4 20,901,5 6,679,903 27,581,4 31635A2
CENTRAL CASH 3 86 84 87 0
FUND 4.088%
7/7/97
27,581,4 27,581,4
86 87
TOTAL 970,222,5 222,544,9 1,192,76 881,710, 206,895,6 1,088,60
INVESTMENTS 83 03 7,486 591 94 6,285
</TABLE>
POWER OF ATTORNEY
We, the undersigned Directors, Trustees, or General Partners, as the
case may be, of the following investment companies:
<TABLE>
<CAPTION>
<S> <C>
FIDELITY ABERDEEN STREET TRUST FIDELITY GOVERNMENT SECURITIES FUND
FIDELITY ADVISOR ANNUITY FUND FIDELITY HASTINGS STREET TRUST
FIDELITY ADVISOR SERIES I FIDELITY HEREFORD STREET TRUST
FIDELITY ADVISOR SERIES II FIDELITY INCOME FUND
FIDELITY ADVISOR SERIES III FIDELITY INSTITUTIONAL CASH PORTFOLIOS
FIDELITY ADVISOR SERIES IV FIDELITY INSTITUTIONAL TAX-EXEMPT CASH PORTFOLIOS
FIDELITY ADVISOR SERIES V FIDELITY INSTITUTIONAL TRUST
FIDELITY ADVISOR SERIES VI FIDELITY INVESTMENT TRUST
FIDELITY ADVISOR SERIES VII FIDELITY MAGELLAN FUND
FIDELITY ADVISOR SERIES VIII FIDELITY MASSACHUSETTS MUNICIPAL TRUST
FIDELITY BEACON STREET TRUST FIDELITY MONEY MARKET TRUST
FIDELITY BOSTON STREET TRUST FIDELITY MT. VERNON STREET TRUST
FIDELITY CALIFORNIA MUNICIPAL TRUST FIDELITY MUNICIPAL TRUST
FIDELITY CALIFORNIA MUNICIPAL TRUST II FIDELITY MUNICIPAL TRUST II
FIDELITY CAPITAL TRUST FIDELITY NEW YORK MUNICIPAL TRUST
FIDELITY CHARLES STREET TRUST FIDELITY NEW YORK MUNICIPAL TRUST II
FIDELITY COMMONWEALTH TRUST FIDELITY PHILLIPS STREET TRUST
FIDELITY CONGRESS STREET FUND FIDELITY PURITAN TRUST
FIDELITY CONTRAFUND FIDELITY REVERE STREET TRUST
FIDELITY CORPORATE TRUST FIDELITY SCHOOL STREET TRUST
FIDELITY COURT STREET TRUST FIDELITY SECURITIES FUND
FIDELITY COURT STREET TRUST II FIDELITY SELECT PORTFOLIOS
FIDELITY COVINGTON TRUST FIDELITY STERLING PERFORMANCE PORTFOLIO, L.P.
FIDELITY DAILY MONEY FUND FIDELITY SUMMER STREET TRUST
FIDELITY DAILY TAX-EXEMPT FUND FIDELITY TREND FUND
FIDELITY DESTINY PORTFOLIOS FIDELITY U.S. INVESTMENTS-BOND FUND, L.P.
FIDELITY DEUTSCHE MARK PERFORMANCE FIDELITY U.S. INVESTMENTS-GOVERNMENT SECURITIES
PORTFOLIO, L.P. FUND, L.P.
FIDELITY DEVONSHIRE TRUST FIDELITY UNION STREET TRUST
FIDELITY EXCHANGE FUND FIDELITY UNION STREET TRUST II
FIDELITY FINANCIAL TRUST FIDELITY YEN PERFORMANCE PORTFOLIO, L.P.
FIDELITY FIXED-INCOME TRUST VARIABLE INSURANCE PRODUCTS FUND
VARIABLE INSURANCE PRODUCTS FUND II
</TABLE>
plus any other investment company for which Fidelity Management &
Research Company or an affiliate acts as investment adviser and for
which the undersigned individual serves as Directors, Trustees, or
General Partners (collectively, the "Funds"), hereby constitute and
appoint Arthur J. Brown, Arthur C. Delibert, Stephanie A. Djinis,
Robert C. Hacker, Thomas M. Leahey, Richard M. Phillips, and Dana L.
Platt, each of them singly, our true and lawful attorneys-in-fact,
with full power of substitution, and with full power to each of them,
to sign for us and in our names in the appropriate capacities, all
Registration Statements of the Funds on Form N-1A, Form N-8A or any
successor thereto, any and all subsequent Amendments, Pre-Effective
Amendments, or Post-Effective Amendments to said Registration
Statements on Form N-1A or any successor thereto, any Registration
Statements on Form N-14, and any supplements or other instruments in
connection therewith, and generally to do all such things in our names
and behalf in connection therewith as said attorneys-in-fact deems
necessary or appropriate, to comply with the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, and all
related requirements of the Securities and Exchange Commission. I
hereby ratify and confirm all that said attorneys-in-fact or their
substitutes may do or cause to be done by virtue hereof. This power
of attorney is effective for all documents filed on or after January
1, 1997.
WITNESS our hands on this nineteenth day of December, 1996.
/S/EDWARD C. JOHNSON 3D___________ /S/PETER S. LYNCH________________
EDWARD C. JOHNSON 3D PETER S. LYNCH
/S/J. GARY BURKHEAD_______________ /S/WILLIAM O. MCCOY______________
J. GARY BURKHEAD WILLIAM O. MCCOY
/S/RALPH F. COX __________________ /S/GERALD C. MCDONOUGH___________
RALPH F. COX GERALD C. MCDONOUGH
/S/PHYLLIS BURKE DAVIS_____________ /S/MARVIN L. MANN________________
PHYLLIS BURKE DAVIS MARVIN L. MANN
/S/E. BRADLEY JONES________________ /S/THOMAS R. WILLIAMS ____________
E. BRADLEY JONES THOMAS R. WILLIAMS
/S/DONALD J. KIRK __________________
DONALD J. KIRK
POWER OF ATTORNEY
I, the undersigned Director, Trustee, or General Partner, as the case
may be, of the following investment companies:
<TABLE>
<CAPTION>
<S> <C>
FIDELITY ABERDEEN STREET TRUST FIDELITY GOVERNMENT SECURITIES FUND
FIDELITY ADVISOR ANNUITY FUND FIDELITY HASTINGS STREET TRUST
FIDELITY ADVISOR SERIES I FIDELITY HEREFORD STREET TRUST
FIDELITY ADVISOR SERIES II FIDELITY INCOME FUND
FIDELITY ADVISOR SERIES III FIDELITY INSTITUTIONAL CASH PORTFOLIOS
FIDELITY ADVISOR SERIES IV FIDELITY INSTITUTIONAL TAX-EXEMPT CASH PORTFOLIOS
FIDELITY ADVISOR SERIES V FIDELITY INSTITUTIONAL TRUST
FIDELITY ADVISOR SERIES VI FIDELITY INVESTMENT TRUST
FIDELITY ADVISOR SERIES VII FIDELITY MAGELLAN FUND
FIDELITY ADVISOR SERIES VIII FIDELITY MASSACHUSETTS MUNICIPAL TRUST
FIDELITY BEACON STREET TRUST FIDELITY MONEY MARKET TRUST
FIDELITY BOSTON STREET TRUST FIDELITY MT. VERNON STREET TRUST
FIDELITY CALIFORNIA MUNICIPAL TRUST FIDELITY MUNICIPAL TRUST
FIDELITY CALIFORNIA MUNICIPAL TRUST II FIDELITY MUNICIPAL TRUST II
FIDELITY CAPITAL TRUST FIDELITY NEW YORK MUNICIPAL TRUST
FIDELITY CHARLES STREET TRUST FIDELITY NEW YORK MUNICIPAL TRUST II
FIDELITY COMMONWEALTH TRUST FIDELITY PHILLIPS STREET TRUST
FIDELITY CONGRESS STREET FUND FIDELITY PURITAN TRUST
FIDELITY CONTRAFUND FIDELITY REVERE STREET TRUST
FIDELITY CORPORATE TRUST FIDELITY SCHOOL STREET TRUST
FIDELITY COURT STREET TRUST FIDELITY SECURITIES FUND
FIDELITY COURT STREET TRUST II FIDELITY SELECT PORTFOLIOS
FIDELITY COVINGTON TRUST FIDELITY STERLING PERFORMANCE PORTFOLIO, L.P.
FIDELITY DAILY MONEY FUND FIDELITY SUMMER STREET TRUST
FIDELITY DAILY TAX-EXEMPT FUND FIDELITY TREND FUND
FIDELITY DESTINY PORTFOLIOS FIDELITY U.S. INVESTMENTS-BOND FUND, L.P.
FIDELITY DEUTSCHE MARK PERFORMANCE FIDELITY U.S. INVESTMENTS-GOVERNMENT SECURITIES
PORTFOLIO, L.P. FUND, L.P.
FIDELITY DEVONSHIRE TRUST FIDELITY UNION STREET TRUST
FIDELITY EXCHANGE FUND FIDELITY UNION STREET TRUST II
FIDELITY FINANCIAL TRUST FIDELITY YEN PERFORMANCE PORTFOLIO, L.P.
FIDELITY FIXED-INCOME TRUST VARIABLE INSURANCE PRODUCTS FUND
VARIABLE INSURANCE PRODUCTS FUND II
</TABLE>
plus any other investment company for which Fidelity Management &
Research Company or an affiliate acts as investment adviser and for
which the undersigned individual serves as Director, Trustee, or
General Partner (collectively, the "Funds"), hereby constitute and
appoint Arthur J. Brown, Arthur C. Delibert, Stephanie A. Djinis,
Robert C. Hacker, Thomas M. Leahey, Richard M. Phillips, and Dana L.
Platt, each of them singly, my true and lawful attorneys-in-fact, with
full power of substitution, and with full power to each of them, to
sign for me and in my name in the appropriate capacities, all
Registration Statements of the Funds on Form N-1A, Form N-8A or any
successor thereto, any and all subsequent Amendments, Pre-Effective
Amendments, or Post-Effective Amendments to said Registration
Statements on Form N-1A or any successor thereto, any Registration
Statements on Form N-14, and any supplements or other instruments in
connection therewith, and generally to do all such things in my name
and behalf in connection therewith as said attorneys-in-fact deem
necessary or appropriate, to comply with the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, and all
related requirements of the Securities and Exchange Commission. I
hereby ratify and confirm all that said attorneys-in-fact or their
substitutes may do or cause to be done by virtue hereof. This power
of attorney is effective for all documents filed on or after March 1,
1997.
WITNESS my hand on the date set forth below.
/S/ROBERT M. GATES MARCH 6, 1997
ROBERT M. GATES
POWER OF ATTORNEY
I, the undersigned President and Director, Trustee, or General
Partner, as the case may be, of the following investment companies:
<TABLE>
<CAPTION>
<S> <C>
FIDELITY ABERDEEN STREET TRUST FIDELITY HEREFORD STREET TRUST
FIDELITY ADVISOR SERIES I FIDELITY INCOME FUND
FIDELITY ADVISOR SERIES II FIDELITY INSTITUTIONAL CASH PORTFOLIOS
FIDELITY ADVISOR SERIES III FIDELITY INSTITUTIONAL TAX-EXEMPT CASH PORTFOLIOS
FIDELITY ADVISOR SERIES IV FIDELITY INVESTMENT TRUST
FIDELITY ADVISOR SERIES V FIDELITY MAGELLAN FUND
FIDELITY ADVISOR SERIES VI FIDELITY MASSACHUSETTS MUNICIPAL TRUST
FIDELITY ADVISOR SERIES VII FIDELITY MONEY MARKET TRUST
FIDELITY ADVISOR SERIES VIII FIDELITY MT. VERNON STREET TRUST
FIDELITY BEACON STREET TRUST FIDELITY MUNICIPAL TRUST
FIDELITY BOSTON STREET TRUST FIDELITY MUNICIPAL TRUST II
FIDELITY CALIFORNIA MUNICIPAL TRUST FIDELITY NEW YORK MUNICIPAL TRUST
FIDELITY CALIFORNIA MUNICIPAL TRUST II FIDELITY NEW YORK MUNICIPAL TRUST II
FIDELITY CAPITAL TRUST FIDELITY PHILLIPS STREET TRUST
FIDELITY CHARLES STREET TRUST FIDELITY PURITAN TRUST
FIDELITY COMMONWEALTH TRUST FIDELITY REVERE STREET TRUST
FIDELITY CONCORD STREET TRUST FIDELITY SCHOOL STREET TRUST
FIDELITY CONGRESS STREET FUND FIDELITY SECURITIES FUND
FIDELITY CONTRAFUND FIDELITY SELECT PORTFOLIOS
FIDELITY CORPORATE TRUST FIDELITY STERLING PERFORMANCE PORTFOLIO, L.P.
FIDELITY COURT STREET TRUST FIDELITY SUMMER STREET TRUST
FIDELITY COURT STREET TRUST II FIDELITY TREND FUND
FIDELITY COVINGTON TRUST FIDELITY U.S. INVESTMENTS-BOND FUND, L.P.
FIDELITY DAILY MONEY FUND FIDELITY U.S. INVESTMENTS-GOVERNMENT SECURITIES
FIDELITY DESTINY PORTFOLIOS FUND, L.P.
FIDELITY DEUTSCHE MARK PERFORMANCE FIDELITY UNION STREET TRUST
PORTFOLIO, L.P. FIDELITY UNION STREET TRUST II
FIDELITY DEVONSHIRE TRUST FIDELITY YEN PERFORMANCE PORTFOLIO, L.P.
FIDELITY EXCHANGE FUND NEWBURY STREET TRUST
FIDELITY FINANCIAL TRUST VARIABLE INSURANCE PRODUCTS FUND
FIDELITY FIXED-INCOME TRUST VARIABLE INSURANCE PRODUCTS FUND II
FIDELITY GOVERNMENT SECURITIES FUND VARIABLE INSURANCE PRODUCTS FUND III
FIDELITY HASTINGS STREET TRUST
</TABLE>
in addition to any other investment company for which Fidelity
Management & Research Company or an affiliate acts as investment
adviser and for which the undersigned individual serves as President
and Director, Trustee, or General Partner (collectively, the "Funds"),
hereby constitute and appoint Robert C. Pozen my true and lawful
attorney-in-fact, with full power of substitution, and with full power
to him to sign for me and in my name in the appropriate capacity, all
Registration Statements of the Funds on Form N-1A, Form N-8A, or any
successor thereto, any and all subsequent Amendments, Pre-Effective
Amendments, or Post-Effective Amendments to said Registration
Statements on Form N-1A, Form N-8A, or any successor thereto, any
Registration Statements on Form N-14, and any supplements or other
instruments in connection therewith, and generally to do all such
things in my name and on my behalf in connection therewith as said
attorney-in-fact deems necessary or appropriate, to comply with the
provisions of the Securities Act of 1933 and the Investment Company
Act of 1940, and all related requirements of the Securities and
Exchange Commission. I hereby ratify and confirm all that said
attorney-in-fact or his substitutes may do or cause to be done by
virtue hereof. This power of attorney is effective for all documents
filed on or after August 1, 1997.
WITNESS my hand on the date set forth below.
/S/EDWARD C. JOHNSON 3D_ JULY 17, 1997
EDWARD C. JOHNSON 3D
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
"Rule 24f-2 Notice"
Fidelity School Street Trust
(Name of Registrant)
File No. 2-57167
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 24F-2
Annual Notice of Securities Sold
Pursuant to Rule 24f-2
Read instructions at end of Form Before preparing Form.
Please print or type.
1.
Name and address of issuer: Fidelity School Street Trust
82 Devonshire Street, Boston, MA, 02109
2.
Name of each series or class of funds for which this notice is filed:
Fidelity Limited Term Municipal Income Fund
3.
Investment Company Act File Number: 811-2676
Securities Act File Number: 2-57167
4.
Last day of fiscal year for which this notice is filed: December 31,
1996
5.
Check box if this notice is being filed more than 180 days after
the close of the issuer's fiscal year for purposes of reporting
securities
sold after the close of the fiscal year but before termination of
the issuer's 24f-2 declaration:
[ ]
6.
Date of termination of issuer's declaration under rule 24f-2(a)(1),
if applicable (see Instruction A.6):
7.
Number and amount of securities of the same class or series which
had been registered under the Securites Act of 1933 other than
pursuant
to rule 24f-2 in a prior fiscal year, but which remained unsold at
the beginning of the fiscal year:
Number of Shares: 26,542,267
Aggregate Price: 251,355,273
8.
Number and amount of securities registered during the fiscal year
other than pursuant to rule 24f-2:
Number of Shares: 1,528,138
Aggregate Price: 14,715,970
9.
Number and aggregate sale price of securities sold during the fiscal
year:
Number of Shares: 24,011,286
Aggregate Price: 231,771,389
10.
Number and aggregate sale price of securities sold during the fiscal
year in reliance upon registration pursuant to rule 24f-2:
Number of Shares: 24,011,286
Aggregate Price: 231,771,389
11.
Number and aggregate sale price of securities issued during the fiscal
year in connection with dividend reinvestment plans, if applicable
(see Instruction B.7):
12.
Calculation of registration fee:
(i)
Aggregate sale price of securities sold during the fiscal
year in reliance on rule 24f-2 (from Item 10): 231,771,389
(ii)
Aggregate price of shares issued in connection with
dividend reinvestment plans (from Item 11, if applicable): 0
(iii)
Aggregate price of shares redeemed or repurchased during
the fiscal year (if applicable): (231,771,389)
(iv)
Aggregate price of shares redeemed or repurchased and previously
applied as a reduction to filing fees pursuant to
rule 24e-2 (if applicable): 0
(v)
Net aggregate price of securities sold and issued during the fiscal
year in reliance on rule 24f-2 [line (i), plus
line (ii), less line (iii), plus line (iv)] (if applicable): 0
(vi)
Multiplier prescribed by Section 6(b) of the Securities Act of 1933
or other applicable law or regulation (see
Instruction C.6): 1/3300
(vii)
Fee due [line (i) or line (v) muliplied by line (vi)]: 0
Instruction: Issuers should complete lines (ii), (iii), (iv), and
(v) only if the form is being filed within 60
days after the close of the issuer's fiscal year. See Instruction
C.3.
13.
Check box if fees are being remitted to the Commission's lockbox
depository as described in section 3a of the Commission's Rules of
Informal and Other Procedures (17 CFR 202.3a).
[n]
Date of mailing or wire transfer of filing fees to the Commission's
lockbox depository:
February 20, 1997
SIGNATURES
This report has been signed below by the following persons on behalf
of the issuer and in the capacities and on the dates indicated.
By (Signature and Title)* John H. Costello
Assistant Treasurer
Date February 27, 1997
* Please print the name and title of the signing officer below the
signature.
Fidelity
Investments
Fidelity Management & Research Co.
82 Devonshire Street
Boston, MA 02109
617 570 7000
February 20, 1997
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, DC 20549
RE: Rule 24f-2 Notice
Fidelity School Street Trust
File No. 2-57167
Gentlemen:
Pursuant to Rule 24f-2(b)(1) under the Investment Company Act of
1940,
enclosed herewith on behalf of the above fund is a Rule 24f-2 Notice
for
the fiscal year ended December 31, 1996
. In accordance with Rule 24f-2(c), the
required filing fee of $0
was wired to Mellon Bank, in Pittsburgh,
Pennsylvania on February 20, 1997
.
Very truly yours,
Fidelity School Street Trust
By John H. Costello
Assistant Treasurer
Enclosures
February 20, 1997
Mr. John Costello, Assistant Treasurer
Fidelity School Street Trust (the trust):
Fidelity Limited Term Municipal Income Fund (the fund)
82 Devonshire Street
Boston, Massachusetts 02109
Dear Mr. Costello:
Fidelity School Street Trust (the Trust) is a Massachusetts business
Trust created under the name of "Municipal Bond Fund" under a
written Declaration of Trust dated, executed and delivered in
Boston, Massachusetts on September 10, 1976. The Trust's name
was changed to "Fidelity Mid-Term Municipals" by vote of the
Board of Trustees on February 11, 1977, which vote was approved
at a Special Meeting of the Sole Shareholder of the Trust on
February 28, 1977. The corresponding amendment to the
Declaration of Trust was filed with the Secretary of the
Commonwealth of Massachusetts (the Commonwealth) on March
1, 1977. A supplement dated March 18, 1977 to the Declaration of
Trust was filed with the Commonwealth on March 28, 1977. The
Trust's name was further changed to "Fidelity Limited Term
Municipals" by vote of the Board of Trustees on April 15, 1977.
Having been approved by a majority of the outstanding shares of
the Trust, the corresponding amendment to the Declaration of
Trust was also executed and filed with the Secretary of the
Commonwealth on April 15, 1977. The Declaration of Trust was
further supplemented on September 3, 1978 and filed with the
Commonwealth on September 14, 1978. An amended and restated
Declaration of Trust, providing for a Board of up to twelve
Trustees, increasing the Fund's ability to pledge its assets, and
authorizing the creation of additional portfolios of the Trust, was
approved at a Special Meeting of Shareholders on February 24,
1987 and was executed and filed with the Commonwealth on
March 24, 1987. A supplement to the Declaration of Trust was
dated and filed with the Commonwealth on November 30, 1988.
The Trust's name was further changed to "Fidelity School Street
Trust" by vote of the Board of Trustees on June 17, 1993, the
corresponding amendment to the Declaration of Trust was
executed and filed with the Secretary of the Commonwealth on July
1, 1993. By vote of the Board of Trustees on March 17, 1994,
which vote was approved at a Special Meeting of the Shareholders
of the Trust on December 14, 1994, an amended and restated
Declaration of Trust was executed on January 27, 1995 and filed
with the Secretary of the Commonwealth on February 14, 1995.
I have conducted such legal and factual inquiry as I have deemed
necessary for the purpose of rendering this opinion.
Capitalized terms used herein, and not otherwise herein defined, are
used as defined in the Declaration of Trust.
Under Article III, Section 1, of the Declaration of Trust, the
beneficial interest in the Trust shall be divided into such
transferable
Shares of one or more separate and distinct Series as the Trustees
shall from time to time create and establish. The number of Shares
is unlimited and each Share shall be without par value and shall be
fully paid and non assessable. The Trustees shall have full power
and authority, in their sole discretion and without obtaining any
prior authorization or vote of the Shareholders or any Series or
class of Shareholders of the Trust, to create and establish (and to
change in any manner) Shares or any Series or classes thereof with
such preferences, voting powers, rights and privileges as the
Trustees may from time to time determine, to divide or combine the
Shares or any Series or classes thereof into a greater or lesser
number, to classify or reclassify any issued Shares into one or more
Series of Shares, to abolish any one or more Series or classes of
Shares, and to take such other action with respect to the Shares as
the Trustees may deem desirable.
Under Article III, Section 4, the Trustees shall accept investments
in the Trust from such persons and on such terms as they may from
time to time authorize. Such investments may be in the form of
cash or securities in which the appropriate Series is authorized to
invest, valued as provided in Article X, Section 3. After the date of
the initial contribution of capital, the number of Shares to represent
the initial contribution may in the Trustees' discretion be considered
as outstanding and the amount received by the Trustees on the
account of the contribution shall be treated as an asset of the Trust.
Subsequent investments in the Trust shall be credited to each
Shareholder's account in the form of full Shares at the Net Asset
Value per Share next determined after the investment is received;
provided, however, that the Trustees may, in their sole discretion,
(a) impose a sales charge upon investments in the Trust and (b)
issue fractional Shares.
By a vote adopted on September 10, 1976, and amended on
February 22, 1985, the Board of Trustees authorized the issue and
sale, from time to time, of an unlimited number of shares of
beneficial interest of the trust in accordance with the terms included
in the current Registration Statement and subject to the limitations
of the Declaration of Trust and any amendments thereto.
I understand from you that, pursuant to Rule 24f-2 under the
Investment Company Act of 1940, the trust has registered an
indefinite amount of shares of beneficial interest under the
Securities Act of 1933. I further understand that, pursuant to the
provisions of Rule 24f-2, the trust intends to file with the
Securities and Exchange Commission a Notice making definite the
registration of 24,011,286 shares of the trust (the "Shares") sold in
reliance upon Rule 24f-2 during the fiscal year ended December 31,
1996.
I am of the opinion that all necessary trust action precedent to the
issue of Shares has been duly taken, and that all the Shares were
legally and validly issued, and are fully paid and non assessable,
except as described in the fund's Statement of Additional
Information under the heading "Shareholder and Trustee Liability."
In rendering this opinion, I rely on the representation by the trust
that it or its agent received consideration for the Shares in
accordance with the Declaration of Trust and I express no opinion
as to compliance with the Securities Act of 1933, the Investment
Company Act of 1940 or applicable state "Blue Sky" or securities
laws in connection with sales of the Shares.
I hereby consent to the filing of this opinion with the Securities and
Exchange Commission in connection with a Rule 24f-2 Notice
which you are about to file under the 1940 Act with said
commission.
Sincerely,
/s/Arthur S. Loring
Arthur S. Loring
Vice President- Legal
