SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the [X]
Registrant
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Party other than the
Registrant
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the
Commission Only (as
permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant
to Sec. 240.14a-11(c) or
Sec. 240.14a-12
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below
per Exchange Act Rules
14a-6(i)(1) and 0-11.
(1) Title of each class of
securities to which
transaction applies:
(2) Aggregate number of
securities to which
transaction applies:
(3) Per unit price or other
underlying value of
transaction
computed pursuant to Exchange
Act Rule 0-11:
(4) Proposed maximum aggregate
value of transaction:
(5) Total Fee Paid:
[ ] Fee paid previously with
preliminary materials.
[ ] Check box if any part of the
fee is offset as provided by
Exchange Act Rule 0-11(a) (2)
and identify the filing for
which the offsetting fee was
paid previously. Identify the
previous filing by
registration statement
number, or the Form or
Schedule and the date of
its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or
Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
FIDELITY(registered trademark) CAPITAL APPRECIATION FUND
FIDELITY DISCIPLINED EQUITY FUND
FIDELITY SMALL CAP SELECTOR
FIDELITY STOCK SELECTOR
FIDELITY TECHNOQUANT(registered trademark) GROWTH FUND
FIDELITY VALUE FUND
FUNDS OF
FIDELITY CAPITAL TRUST
82 DEVONSHIRE STREET, BOSTON, MASSACHUSETTS 02109
1-800-544-6666
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To the Shareholders of the above funds:
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders (the
Meeting) of Fidelity Capital Appreciation Fund, Fidelity Disciplined
Equity Fund, Fidelity Small Cap Selector, Fidelity Stock Selector,
Fidelity TechnoQuant Growth Fund, and Fidelity Value Fund (the funds),
will be held at an office of Fidelity Capital Trust (the trust), 27
State Street, 10th Floor, Boston, Massachusetts 02109 on March 15,
2000 at 10:00 a.m. The purpose of the Meeting is to consider and act
upon the following proposals, and to transact such other business as
may properly come before the Meeting or any adjournments thereof.
1. To elect a Board of Trustees.
2. To elect or ratify the selection of Deloitte & Touche LLP or
PricewaterhouseCoopers LLP as independent accountants of the
funds.
3. To authorize the Trustees to adopt an amended and restated
Declaration of Trust.
4. To approve an amended management contract for each of Fidelity
Capital Appreciation Fund, Fidelity Disciplined Equity Fund,
Fidelity Stock Selector and Fidelity Value Fund.
5. To approve an amended management contract for Fidelity Small Cap
Selector.
6. To approve an amended management contract for Fidelity TechnoQuant
Growth Fund.
7. To approve an amended sub-advisory agreement with FMR U.K. for
each of Fidelity Capital Appreciation Fund, Fidelity Disciplined
Equity Fund, Fidelity Stock Selector, Fidelity TechnoQuant Growth
Fund and Fidelity Value Fund.
8. To approve an amended sub-advisory agreement with FMR Far East for
each of Fidelity Capital Appreciation Fund, Fidelity Disciplined
Equity Fund, Fidelity Stock Selector, Fidelity TechnoQuant Growth
Fund and Fidelity Value Fund.
9. To approve a Distribution and Service Plan pursuant to Rule 12b-1
for each of Fidelity Capital Appreciation Fund and Fidelity
TechnoQuant Growth Fund.
10. To eliminate certain fundamental investment policies of Fidelity
Capital Appreciation Fund.
11. To eliminate a fundamental investment policy of Fidelity
Disciplined Equity Fund.
12. To eliminate a fundamental investment policy of Fidelity Stock
Selector.
ADOPTION OF STANDARDIZED INVESTMENT LIMITATIONS
13. To amend the fundamental investment limitation concerning
diversification to exclude securities of other investment
companies from the limitation for each of Fidelity Capital
Appreciation Fund, Fidelity Disciplined Equity Fund, Fidelity
Stock Selector and Fidelity Value Fund.
14. To amend Fidelity Capital Appreciation Fund's fundamental
investment limitation concerning concentration.
15. To amend Fidelity Value Fund's fundamental investment limitation
concerning underwriting.
The Board of Trustees has fixed the close of business on January 18,
2000 as the record date for the determination of the shareholders of
each of the funds entitled to notice of, and to vote at, such Meeting
and any adjournments thereof.
By order of the Board of Trustees,
ERIC D. ROITER Secretary
January 18, 2000
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
PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS OF
FIDELITY CAPITAL TRUST: FIDELITY CAPITAL APPRECIATION FUND
FIDELITY DISCIPLINED EQUITY FUND
FIDELITY SMALL CAP SELECTOR
FIDELITY STOCK SELECTOR
FIDELITY TECHNOQUANT GROWTH FUND
FIDELITY VALUE FUND
TO BE HELD ON MARCH 15, 2000
This Proxy Statement is furnished in connection with a solicitation
of proxies made by, and on behalf of, the Board of Trustees of
Fidelity Capital Trust (the trust) to be used at the Special Meeting
of Shareholders of Fidelity Capital Appreciation Fund, Fidelity
Disciplined Equity Fund, Fidelity Small Cap Selector, Fidelity Stock
Selector, Fidelity TechnoQuant Growth Fund, and Fidelity Value Fund
(the funds) and at any adjournments thereof (the Meeting), to be held
on March 15, 2000 at 10 a.m. at 27 State Street, 10th Floor, Boston,
Massachusetts 02109, an office of the trust and Fidelity Management &
Research Company (FMR), the funds' investment adviser.
The purpose of the Meeting is set forth in the accompanying Notice.
The solicitation is being made primarily by the mailing of this Proxy
Statement and the accompanying proxy card on or about January 18,
2000. 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. may
be paid on a per-call basis to solicit shareholders on behalf of the
funds at an anticipated cost of approximately $8,000 (Fidelity Capital
Appreciation Fund), $8,000 (Fidelity Disciplined Equity Fund), $3,000
(Fidelity Small Cap Selector), $6,000 (Fidelity Stock Selector),
$2,000 (Fidelity TechnoQuant Growth Fund), and $10,000 (Fidelity Value
Fund). The funds 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 funds at an anticipated cost
of approximately $10,000 (Fidelity Capital Appreciation Fund), $10,000
(Fidelity Disciplined Equity Fund), $5,000 (Fidelity Small Cap
Selector), $8,000 (Fidelity Stock Selector), $2,000 (Fidelity
TechnoQuant Growth Fund), and $12,000 (Fidelity Value Fund). If the
funds record votes by telephone, they 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 voted by telephone may be revoked at any
time before they are voted in the same manner that proxies voted by
mail may be revoked. The expenses in connection with preparing this
Proxy Statement and its enclosures and of all solicitations, including
telephone voting, will be paid by the funds. The funds will reimburse
brokerage firms and others for their reasonable expenses in forwarding
solicitation material to the beneficial owners of shares.
The principal business address of Fidelity Distributors Corporation
(FDC), the funds' principal underwriter and distribution agent, and
Fidelity Management & Research (U.K.) Inc. (FMR U.K.) and Fidelity
Management & Research (Far East) Inc. (FMR Far East), sub-advisers to
the funds, is 82 Devonshire Street, Boston, Massachusetts 02109.
Fidelity Investments Japan Limited (FIJ) located at Shiroyama JT Mori
Bldg., 4-3-1 Toranomon, Minato-ku, Tokyo 105, Japan is also a
sub-adviser to the funds.
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, by the trust's receipt of a subsequent valid telephonic
vote 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 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 towards 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.
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 prior to such adjournment if sufficient votes
have been received and it is otherwise appropriate.
Shares of each fund of the trust issued and outstanding as of
September 30, 1999 are indicated in the following table:
Capital Appreciation Fund 114,070,401
Disciplined Equity Fund 101,043,872
Small Cap Selector 39,863,963
Stock Selector 51,543,384
TechnoQuant Growth Fund 3,326,743
Value Fund 98,118,184
As of September 30, 1999, the nominees and officers of the trust
owned, in the aggregate, less than 1% of the funds' outstanding
shares.
To the knowledge of the trust, no shareholder owned of record or
beneficially more than 5% of the outstanding shares of the funds on
that date.
Shareholders of record at the close of business on January 18, 2000
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.
FOR A FREE COPY OF EACH FUND'S ANNUAL REPORT FOR THE FISCAL YEAR
ENDED OCTOBER 31, 1999 CALL 1-800-544-6666 OR WRITE TO FIDELITY
DISTRIBUTORS CORPORATION AT 82 DEVONSHIRE STREET, BOSTON,
MASSACHUSETTS 02109.
VOTE REQUIRED: A PLURALITY OF ALL VOTES CAST AT THE MEETING IS
SUFFICIENT TO APPROVE PROPOSAL 1 AND A MAJORITY OF ALL VOTES OF THE
APPROPRIATE FUND CAST AT THE MEETING IS SUFFICIENT TO APPROVE PROPOSAL
2. APPROVAL OF PROPOSAL 3 REQUIRES THE AFFIRMATIVE VOTE OF A "MAJORITY
OF THE OUTSTANDING VOTING SECURITIES" OF THE ENTIRE TRUST. APPROVAL OF
PROPOSALS 4 THROUGH 15 REQUIRES THE AFFIRMATIVE VOTE OF A "MAJORITY OF
THE OUTSTANDING VOTING SECURITIES" OF THE APPROPRIATE FUNDS. 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.
The following tables summarize the proposals applicable to each fund.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Proposal # Proposal Description Applicable Funds Page
1. To elect as Trustees the 12 All 3
nominees presented in
proposal 1.
2. To elect or ratify the All
selection of Deloitte &
Touche LLP or
PricewaterhouseCoopers LLP
as independent accountants
of the funds.
3. To authorize the Trustees to All
adopt an amended and
restated Declaration of Trust.
4. To approve an amended Fidelity Capital Appreciation
management contract for the Fund
fund that would reduce the Fidelity Disciplined Equity
management fee payable to Fund
FMR by the fund as FMR's Fidelity Stock Selector
assets under management Fidelity Value Fund
increase, allow future
modifications of the
contract without a
shareholder vote if
permitted by the 1940 Act,
and would modify the
performance adjustment
calculation to calculate the
fund's investment
performance and that of its
comparative index to the
nearest 0.01%.
5. To approve an amended Fidelity Small Cap Selector
management contract for the
fund that would reduce the
management fee payable to
FMR by the fund as FMR's
assets under management
increase.
6. To approve an amended Fidelity TechnoQuant Growth
management contract for the Fund
fund that would reduce the
management fee payable to
FMR by the fund as FMR's
assets under management
increase and allow future
modifications of the
contract without a
shareholder vote if
permitted by the 1940 Act.
7. To approve an amended Fidelity Capital Appreciation
sub-advisory agreement with Fund
FMR U.K. to allow FMR, FMR Fidelity Disciplined Equity
U.K., and the trust, on Fund
behalf of the fund, to Fidelity TechnoQuant Growth
modify the agreement subject Fund
to the requirements of the Fidelity Stock Selector
1940 Act. Fidelity Value Fund
8. To approve an amended Fidelity Capital Appreciation
sub-advisory agreement with Fund
FMR Far East to allow FMR, Fidelity Disciplined Equity
FMR Far East, and the trust, Fund
on behalf of the fund, to Fidelity TechnoQuant Growth
modify the agreement subject Fund
to the requirements of the Fidelity Stock Selector
1940 Act. Fidelity Value Fund
9. To approve a Distribution and Fidelity Capital Appreciation
Service Plan for the fund Fund
which describes all material Fidelity TechnoQuant Growth
aspects of the proposed Fund
financing for the
distribution of fund shares.
10. To eliminate certain Fidelity Capital Appreciation
fundamental investment Fund
policies of the fund.
11. To eliminate a fundamental Fidelity Disciplined Equity
investment policy of the fund. Fund
12. To eliminate a fundamental Fidelity Stock Selector
investment policy of the fund.
ADOPTION OF STANDARDIZED
INVESTMENT LIMITATIONS
13. To amend the fundamental Fidelity Capital Appreciation
investment limitation Fund
concerning diversification Fidelity Disciplined Equity
to exclude "securities of Fund
other investment companies" Fidelity Stock Selector
from the limitation. Fidelity Value Fund
14. To amend the fundamental Fidelity Capital Appreciation
investment limitation Fund
concerning concentration.
15. To amend the fundamental Fidelity Value Fund
investment limitation
concerning underwriting.
</TABLE>
1. TO ELECT A BOARD OF TRUSTEES.
The purpose of this proposal is to elect a Board of Trustees of the
Trust. Pursuant to the provisions of the Declaration of Trust of
Fidelity Capital Trust, the Trustees have determined that the number
of Trustees shall be fixed at twelve. It is intended that the enclosed
proxy card will be voted for the election as Trustees of the twelve
nominees listed below, unless such authority has been withheld in the
proxy card.
All nominees named below are currently Trustees of Fidelity Capital
Trust and have served in that capacity continuously since originally
elected or appointed. Robert M. Gates, Ned C. Lautenbach, William O.
McCoy and Robert C. Pozen were selected by the trust's Nominating and
Administration Committee (see page ) and were appointed to the Board
in March 1997, January 2000, January 1997 and August 1997,
respectively. None of the nominees are related to one another. Those
nominees indicated by an asterisk (*) are "interested persons" of the
trust by virtue of, among other things, their affiliation with either
the trust, the funds' investment adviser (FMR, or the Adviser), or the
funds' distribution agent, FDC. The business address of each nominee
who is an "interested person" is 82 Devonshire Street, Boston,
Massachusetts 02109, and the business address of all other nominees is
Fidelity Investments, P.O. Box 9235, Boston, Massachusetts 02205-9235.
Except for Messrs. Gates, Lautenbach, McCoy, and Pozen, each of the
nominees is currently a Trustee of 57 registered investment companies
advised by FMR. Mr. Gates, Mr. Lautenbach, Mr. McCoy and Mr. Pozen are
currently Trustees of 55 registered investment companies advised by
FMR.
In the election of Trustees, those twelve nominees receiving the
highest number of votes cast at the Meeting, providing a quorum is
present, shall be elected.
<TABLE>
<CAPTION>
<S> <C> <C>
Nominee (Age) Principal Occupation** Year of Election or Appointment
Ralph F. Cox (67) President of RABAR 1991
Enterprises (management
consulting-engineering
industry, 1994). Prior to
February 1994, he was
President of Greenhill
Petroleum Corporation
(petroleum exploration and
production). Until March
1990, Mr. Cox was President
and Chief Operating Officer
of Union Pacific Resources
Company (exploration and
production). He is a
Director of Waste Management
Inc. (non-hazardous waste,
1993), CH2M Hill Companies
(engineering), and
Bonneville Pacific
(independent power and
petroleum production). In
addition, he is a member of
advisory boards of Texas A&M
University and the
University of Texas at Austin.
Nominee (Age) Principal Occupation** Year of Election or Appointment
Phyllis Burke Davis (68) Retired from Avon Products, 1992
Inc. where she held various
positions including Senior
Vice President of Corporate
Affairs and Group Vice
President of U.S. sales,
distribution, and
manufacturing. She is
currently a Director of
BellSouth Corporation
(telecommunications), Eaton
Corporation (manufacturing),
and the TJX Companies, Inc.
(retail stores), and
previously served as a
Director of Hallmark Cards,
Inc., Nabisco Brands, Inc.,
and Standard Brands, Inc. In
addition, she is a member of
the Board of Directors of
the Southampton Hospital in
Southampton, N.Y. (1998).
Robert M. Gates (56) Consultant, author, and 1997
lecturer (1993). Mr. Gates
was Director of the Central
Intelligence Agency (CIA)
from 1991-1993. From 1989 to
1991, Mr. Gates served as
Assistant to the President
of the United States and
Deputy National Security
Advisor. Mr. Gates is a
Director of Charles Stark
Draper Laboratory
(non-profit), NACCO
Industries, Inc. (mining and
manufacturing), and TRW Inc.
(automotive, space, defense,
and information technology).
Mr. Gates previously served
as a Director of LucasVarity
PLC (automotive components
and diesel engines). He is
currently serving as Dean of
the George Bush School of
Government and Public
Service at Texas A & M
University (1999-2000). Mr.
Gates also is a Trustee of
the Forum for International
Policy and of the Endowment
Association of the College
of William and Mary. In
addition, he is a member of
the National Executive Board
of the Boy Scouts of America.
*Edward C. Johnson 3d (69) President, is Chairman, Chief 1978
Executive Officer and a
Director of FMR Corp.; a
Director and Chairman of the
Board and of the Executive
Committee of FMR; Chairman
and a Director of Fidelity
Investments Money
Management, Inc. (1998),
Fidelity Management &
Research (U.K.) Inc., and
Fidelity Management &
Research (Far East) Inc.;
and a Director of FDC.
Donald J. Kirk (67) Executive-in-Residence (1995) 1987
at Columbia University
Graduate School of Business.
From 1987 to January 1995,
Mr. Kirk was a Professor at
Columbia University Graduate
School of Business. Prior to
1987, he was Chairman of the
Financial Accounting
Standards Board. Mr. Kirk
previously served as a
Director of General Re
Corporation (reinsurance,
1987-1998) and as a Director
of Valuation Research Corp.
(appraisals and valuations,
1993-1995). He serves as
Chairman of the Board of
Directors of National Arts
Stabilization Inc., Chairman
of the Board of Trustees of
the Greenwich Hospital
Association, Director of the
Yale-New Haven Health
Services Corp. (1998), Vice
Chairman of the Public
Oversight Board of the
American Institute of
Certified Public
Accountants' SEC Practice
Section (1995), and as a
Public Governor of the
National Association of
Securities Dealers, Inc.
(1996).
Ned C. Lautenbach (56) Partner of Clayton, Dubilier 2000
& Rice, Inc. (private equity
investment firm) since
September 1998. Mr.
Lautenbach was Senior Vice
President of IBM Corporation
from 1992 until his
retirement in July 1998.
From 1993 to 1995 he was
Chairman of IBM World Trade
Corporation. He also was a
member of IBM's Corporate
Executive Committee from
1994 to July 1998. He is a
Director of PPG Industries
Inc. (glass, coating and
chemical manufacturer),
Dynatech Corporation (global
communications equipment),
Eaton Corporation (global
manufacturer of highly
engineered products) and
ChoicePoint Inc. (data
identification, retrieval,
storage, and analysis).
*Peter S. Lynch (57) Vice Chairman and Director of 1990
FMR. Prior to May 31, 1990,
he was a Director of FMR and
Executive Vice President of
FMR (a position he held
until March 31, 1991); Vice
President of Fidelity
Magellan Fund and FMR Growth
Group Leader; and Managing
Director of FMR Corp. Mr.
Lynch was also Vice
President of Fidelity
Investments Corporate
Services (1991-1992). In
addition, he serves as a
Trustee of Boston College,
Massachusetts Eye & Ear
Infirmary, Historic
Deerfield (1989) and Society
for the Preservation of New
England Antiquities, and as
an Overseer of the Museum of
Fine Arts of Boston.
Gerald C. McDonough (71) Chairman of the 1989
non-interested Trustees, is
Chairman of G.M. Management
Group (strategic advisory
services). Mr. McDonough is
a Director and Chairman of
the Board of York
International Corp. (air
conditioning and
refrigeration), Commercial
Intertech Corp. (hydraulic
systems, building systems,
and metal products, 1992),
CUNO, Inc. (liquid and gas
filtration products, 1996),
and Associated Estates
Realty Corporation (a real
estate investment trust,
1993). Mr. McDonough served
as a Director of
ACME-Cleveland Corp. (metal
working, telecommunications,
and electronic products)
from 1987-1996 and
Brush-Wellman Inc. (metal
refining) from 1983-1997.
Marvin L. Mann (66) Chairman Emeritus, of Lexmark 1993
International, Inc. (office
machines, 1991) where he
still remains a member of
the Board. Prior to 1991, he
held the positions of Vice
President of International
Business Machines
Corporation ("IBM") and
President and General
Manager of various IBM
divisions and subsidiaries.
Mr. Mann is a Director of
M.A. Hanna Company
(chemicals, 1993), Imation
Corp. (imaging and
information storage, 1997).
He is a Board member of
Dynatech Corporation
(electronics, 1999).
*Robert C. Pozen (53) Senior Vice President, is 1997
also President and a
Director of FMR (1997); and
President and a Director of
Fidelity Investments Money
Management, Inc. (1998),
Fidelity Management &
Research (U.K.) Inc. (1997),
and Fidelity Management &
Research (Far East) Inc.
(1997). Previously, Mr.
Pozen served as General
Counsel, Managing Director,
and Senior Vice President of
FMR Corp.
Thomas R. Williams (71) President of The Wales Group, 1989
Inc. (management and
financial advisory
services). Prior to retiring
in 1987, Mr. Williams served
as Chairman of the Board of
First Wachovia Corporation
(bank holding company), and
Chairman and Chief Executive
Officer of The First
National Bank of Atlanta and
First Atlanta Corporation
(bank holding company). He
is currently a Director of
National Life Insurance
Company of Vermont and
American Software, Inc. Mr.
Williams was previously a
Director of ConAgra, Inc.
(agricultural products),
Georgia Power Company
(electric utility), and
Avado, Inc. (restaurants).
</TABLE>
** Except as otherwise indicated, each individual has held the office
shown or other offices in the same company for the last five years.
As of September 30, 1999 the nominees, Trustees and officers of the
Trust and each fund owned, in the aggregate, less than 1% of each
fund's outstanding shares.
If elected, the Trustees will hold office without limit in time
except that (a) any Trustee may resign; (b) any Trustee may be removed
by written instrument, signed by at least two-thirds of the number of
Trustees prior to such removal; (c) any Trustee who requests to be
retired or who has become incapacitated by illness or injury may be
retired by written instrument signed by a majority of the other
Trustees; and (d) a Trustee may be removed at any Special Meeting of
shareholders by a two-thirds vote of the outstanding voting securities
of the trust. In case a vacancy shall for any reason exist, the
remaining Trustees will fill such vacancy by appointing another
Trustee, so long as, immediately after such appointment, at least
two-thirds of the Trustees have been elected by shareholders. If, at
any time, less than a majority of the Trustees holding office has been
elected by the shareholders, the Trustees then in office will promptly
call a shareholders' meeting for the purpose of electing a Board of
Trustees. Otherwise, there will normally be no meeting of shareholders
for the purpose of electing Trustees.
The trust's Board, which is currently composed of three interested
and nine non-interested Trustees, met eleven times during the twelve
months ended October 31, 1999. It is expected that the Trustees will
meet at least ten times a year at regularly scheduled meetings.
The trust's Audit Committee is composed entirely of Trustees who are
not interested persons of the trust, FMR or its affiliates and
normally meets four times a year, or as required, in conjunction with
meetings of the Board of Trustees. Currently, Messrs. Kirk (Chairman),
Gates and McCoy, and Mrs. Davis are members of the Committee. The
committee oversees and monitors the trust's internal control
structure, its auditing function and its financial reporting process,
including the resolution of material reporting issues. The committee
recommends to the Board of Trustees the appointment of auditors for
the trust. It reviews audit plans, fees and other material
arrangements in respect of the engagement of auditors, including
non-audit services to be performed. It reviews the qualifications of
key personnel involved in the foregoing activities. The committee
plays an oversight role in respect of the trust's investment
compliance procedures and the code of ethics. During the twelve months
ended October 31, 1999, the committee held nine meetings.
The trust's Nominating and Administration Committee is currently
composed of Messrs. McDonough (Chairman), Mann, and Williams. The
committee members confer periodically and hold meetings as required.
The committee makes nominations for independent trustees, and for
membership on committees. The committee periodically reviews
procedures and policies of the Board of Trustees and committees. It
acts as the administrative committee under the Retirement Plan for
non-interested trustees who retired prior to December 30, 1996. It
monitors the performance of legal counsel employed by the trust and
the independent trustees. The committee in the first instance monitors
compliance with, and acts as the administrator of the provisions of
the code of ethics applicable to the independent trustees. During the
twelve months ended October 31, 1999, the committee held three
meetings. The Nominating and Administration Committee will consider
nominees recommended by shareholders. Recommendations should be
submitted to the committee in care of the Secretary of the Trust. The
trust does not have a compensation committee; such matters are
considered by the Nominating and Administration Committee.
The following table sets forth information describing the
compensation of each Trustee and Member of the Advisory Board of each
fund for his or her services for the fiscal year ended October 31,
1999, or calendar year ended December 31, 1999, as applicable.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
COMPENSATION TABLE
AGGREGATE COMPENSATION FROM Edward C. Johnson 3d** J. Gary Burkhead** Ralph F. Cox Phyllis Burke Davis
EACH FUND
Fidelity Capital Appreciation $ 0 $ 0 $ 789 $ 756
FundB,C,F
Fidelity Disciplined Equity $ 0 $ 0 $ 925 $ 887
FundB,D,F
Fidelity Small Cap SelectorB $ 0 $ 0 $ 186 $ 179
Fidelity Stock SelectorB $ 0 $ 0 $ 496 $ 476
Fidelity TechnoQuant Growth $ 0 $ 0 $ 15 $ 14
FundB
Fidelity Value FundB,E,F $ 0 $ 0 $ 1,602 $ 1,538
TOTAL COMPENSATION FROM THE $ 0 $ 0 $ 217,500 $211,500
FUND COMPLEX*,A
AGGREGATE COMPENSATION FROM Ned C. Lautenbach*** Peter S. Lynch** William O. McCoy Gerald C. Mc- Donough
EACH FUND
Fidelity Capital Appreciation $ 68 $ 0 $ 783 $ 969
FundB,C,F
Fidelity Disciplined Equity $ 76 $ 0 $ 919 $ 1136
FundB,D,F
Fidelity Small Cap SelectorB $ 13 $ 0 $ 185 $ 228
Fidelity Stock SelectorB $ 38 $ 0 $ 492 $ 609
Fidelity TechnoQuant Growth $ 1 $ 0 $ 15 $ 18
FundB
Fidelity Value FundB,E,F $ 120 $ 0 $ 1,588 $ 1,963
TOTAL COMPENSATION FROM THE $ 54,000 $ 0 $ 214,500 $ 269,000
FUND COMPLEX*,A
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
COMPENSATION TABLE
AGGREGATE COMPENSATION FROM Robert M. Gates E. Bradley Jones**** Donald J. Kirk
EACH FUND
Fidelity Capital Appreciation $ 783 $ 783 $ 778
FundB,C,F
Fidelity Disciplined Equity $ 919 $ 919 $ 912
FundB,D,F
Fidelity Small Cap SelectorB $ 185 $ 185 $ 183
Fidelity Stock SelectorB $ 492 $ 492 $ 489
Fidelity TechnoQuant Growth $ 15 $ 15 $ 15
FundB
Fidelity Value FundB,E,F $ 1,588 $ 1,588 $ 1,577
TOTAL COMPENSATION FROM THE $ 217,500 $ 217,500 $ 217,500
FUND COMPLEX*,A
AGGREGATE COMPENSATION FROM Marvin L. Mann Robert C. Pozen** Thomas R. Williams
EACH FUND
Fidelity Capital Appreciation $ 783 $ 0 $ 767
FundB,C,F
Fidelity Disciplined Equity $ 919 $ 0 $ 900
FundB,D,F
Fidelity Small Cap SelectorB $ 185 $ 0 $ 181
Fidelity Stock SelectorB $ 492 $ 0 $ 483
Fidelity TechnoQuant Growth $ 15 $ 0 $ 15
FundB
Fidelity Value FundB,E,F $ 1,588 $ 0 $ 1,555
TOTAL COMPENSATION FROM THE $ 217,500 $ 0 $213,000
FUND COMPLEX*,A
</TABLE>
* Information is for the calendar year ended December 31, 1999 for 236
funds in the complex.
** Interested Trustees of the funds and Mr. Burkhead are compensated
by FMR.
*** During the period from October 14, 1999 through December 31, 1999,
Mr. Lautenbach served as a Member of the Advisory Board. Effective
January 1, 2000, Mr. Lautenbach serves as a Member of the Board of
Trustees.
**** Mr. Jones served on the Board of Trustees through December 31,
1999.
A Compensation figures include cash, amounts required to be deferred,
and may include amounts deferred at the election of Trustees. For the
calendar year ended December 31, 1999, the Trustees accrued required
deferred compensation from the funds as follows: Ralph F. Cox,
$75,000; Phyllis Burke Davis, $75,000; Robert M. Gates, $75,000; E.
Bradley Jones, $75,000; Donald J. Kirk, $75,000; William O. McCoy,
$75,000; Gerald C. McDonough, $87,500; Marvin L. Mann, $75,000; and
Thomas R. Williams, $75,000. Certain of the non-interested Trustees
elected voluntarily to defer a portion of their compensation as
follows: Ralph F. Cox, $53,735; William O. McCoy, $53,735; and Thomas
R. Williams, $62,319.
B Compensation figures include cash, and may include amounts required
to be deferred and amounts deferred at the election of Trustees.
C The following amounts are required to be deferred by each
non-interested Trustee: Ralph F. Cox, $365; Phyllis Burke Davis, $365;
Robert M. Gates, $365; E. Bradley Jones, $365; Donald J. Kirk, $365;
William O. McCoy, $365; Gerald C. McDonough, $426; Marvin L. Mann,
$365; and Thomas R. Williams, $365.
D The following amounts are required to be deferred by each
non-interested Trustee: Ralph F. Cox, $428; Phyllis Burke Davis, $428;
Robert M. Gates, $428; E. Bradley Jones, $428; Donald J. Kirk, $428;
William O. McCoy, $428; Gerald C. McDonough, $499; Marvin L. Mann,
$428; and Thomas R. Williams, $428.
E The following amounts are required to be deferred by each
non-interested Trustee: Ralph F. Cox, $741; Phyllis Burke Davis, $741;
Robert M. Gates, $741; E. Bradley Jones, $741; Donald J. Kirk, $741;
William O. McCoy, $741; Gerald C. McDonough, $865; Marvin L. Mann,
$741; Thomas R. Williams, $741; and Ned C. Lautenbach, $0.
F Certain of the non-interested Trustees' aggregate compensation from
the fund includes accrued voluntary deferred compensation as follows:
Capital Appreciation (Ralph F. Cox, $305; Marvin L. Mann, $48; William
O. McCoy, $305; and Thomas R. Williams, $305); Disciplined Equity
(Ralph F. Cox, $358; Marvin L. Mann, $61; William O. McCoy, $358;
Thomas R. Williams, $358); Value (Ralph F. Cox, $619; Marvin L. Mann,
$126; William O. McCoy, $619; and Thomas R. Williams, $619).
Under a deferred compensation plan adopted in September 1995 and
amended in November 1996 (the Plan), non-interested Trustees must
defer receipt of a portion of, and may elect to defer receipt of an
additional portion of, their annual fees. Amounts deferred under the
Plan are subject to vesting and are treated as though equivalent
dollar amounts had been invested in shares of a cross-section of
Fidelity funds including funds in each major investment discipline and
representing a majority of Fidelity's assets under management (the
Reference Funds). The amounts ultimately received by the Trustees
under the Plan will be directly linked to the investment performance
of the Reference Funds. Deferral of fees in accordance with the Plan
will have a negligible effect on a fund's assets, liabilities, and net
income per share, and will not obligate a fund to retain the services
of any Trustee or to pay any particular level of compensation to the
Trustee. A fund may invest in the Reference Funds under the Plan
without shareholder approval.
2. TO ELECT OR RATIFY THE SELECTION OF DELOITTE & TOUCHE LLP OR
PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT ACCOUNTANTS OF THE FUNDS.
By a vote of the non-interested Trustees, the firms of Deloitte &
Touche LLP (Fidelity Small Cap Selector) and PricewaterhouseCoopers
LLP (Fidelity Capital Appreciation Fund, Fidelity Disciplined Equity
Fund, Fidelity TechnoQuant Growth Fund and Fidelity Value Fund) have
been selected as independent accountants for such funds to sign or
certify any financial statements of such funds required by any law or
regulation to be certified by an independent accountant and filed with
the Securities and Exchange Commission (SEC) or any state. Pursuant to
the 1940 Act, such selection requires the ratification of
shareholders. On January 19, 2000, it is anticipated that the Audit
Committee will recommend to the Board of Trustees that Deloitte &
Touche LLP be selected as independent accountants for Fidelity Stock
Selector. Therefore, shareholders also are being asked to elect
Deloitte & Touche LLP as independent accountants of Fidelity Stock
Selector. As required by the 1940 Act, the employment of independent
accountants is subject to the right of each fund, by vote of a
majority of its outstanding voting securities at any meeting called
for the purpose of voting on such action, to terminate such employment
without penalty.
Each of Deloitte & Touche LLP, with respect to Fidelity Small Cap
Selector, and PricewaterhouseCoopers LLP, with respect to Fidelity
Capital Appreciation Fund, Fidelity Disciplined Equity Fund, Fidelity
TechnoQuant Growth Fund and Fidelity Value Fund, has advised the funds
that to the best of its knowledge and belief, as of the record date,
no professional of either Deloitte & Touche LLP or
PricewaterhouseCoopers LLP had any direct or material indirect
ownership interest in such funds inconsistent with the independence
standards pertaining to accountants. With respect to Fidelity Stock
Selector, Deloitte & Touche LLP has advised the fund that to the best
of its knowledge and belief, as of the commencement of the firm's
professional engagement to examine the fund's financial statements, no
Deloitte & Touche LLP professional will hold any direct or material
indirect ownership interest in such fund inconsistent with the
independence standards pertaining to accountants.
For Fidelity Stock Selector's fiscal years ended October 31, 1999 and
October 31, 1998, the firm of PricewaterhouseCoopers LLP acted as the
fund's independent accountants. The independent accountants' audit
reports for Fidelity Stock Selector for the fiscal years ended October
31, 1999 and October 31, 1998, did not contain an adverse opinion or
disclaimer of opinion, nor were such reports qualified or modified as
to uncertainty, audit scope, or accounting principles. Further, there
were no disagreements between the fund and the independent accountants
on accounting principles or practices, financial statement
disclosures, or audit scope or procedures, which if not resolved to
the satisfaction of the independent accountants would have caused them
to make reference to the subject matter of the disagreements in
connection with their reports on the financial statements for such
years.
The independent accountants examine annual financial statements for
the funds and provide other audit and tax-related services. In
recommending the selection of each fund's accountants, the Audit
Committee reviewed the nature and scope of the services to be provided
(including non-audit services) and whether the performance of such
services would affect the accountants' independence. Representatives
of Deloitte & Touche LLP and PricewaterhouseCoopers LLP are not
expected to be present at the Meeting, but have been given the
opportunity to make a statement if they so desire and will be
available should any matter arise requiring their presence.
3. TO AUTHORIZE THE TRUSTEES TO ADOPT AN AMENDED AND RESTATED
DECLARATION OF TRUST.
The Board of Trustees has approved and recommends that the
shareholders of the trust authorize them to adopt and execute an
Amended and Restated Declaration of Trust for the trust and the funds
of the trust in the form attached to this Proxy Statement as Exhibit 1
(New Declaration of Trust). The attached New Declaration of Trust has
been marked to show changes from the trust's existing Declaration of
Trust (Current Declaration of Trust). The New Declaration of Trust is
a more modern form of trust instrument for a Massachusetts business
trust, and, going forward, will be used as the standard Declaration of
Trust for all new Fidelity Massachusetts business trusts.
The New Declaration of Trust gives the Trustees more flexibility and,
subject to applicable requirements of the 1940 Act and Massachusetts
law, broader authority to act. This increased flexibility may allow
the Trustees to react more quickly to changes in competitive and
regulatory conditions and, as a consequence, may allow the funds to
operate in a more efficient and economical manner. ADOPTION OF THE NEW
DECLARATION OF TRUST WILL NOT ALTER IN ANY WAY THE TRUSTEES' EXISTING
FIDUCIARY OBLIGATIONS TO ACT WITH DUE CARE AND IN THE SHAREHOLDERS'
INTERESTS. BEFORE UTILIZING ANY NEW FLEXIBILITY THAT THE NEW
DECLARATION OF TRUST MAY AFFORD, THE TRUSTEES MUST FIRST CONSIDER THE
SHAREHOLDERS' INTERESTS AND THEN ACT IN ACCORDANCE WITH SUCH
INTERESTS.
Adoption of the New Declaration of Trust will NOT result in any
changes in the funds' Trustees or officers or in the investment
policies described in the funds' current prospectuses.
Generally, a majority of the Trustees may amend the Current
Declaration of Trust when authorized by a "majority of the outstanding
voting securities" (as defined in the 1940 Act) of the trust. On
October 16, 1997, the Trustees approved the form of the New
Declaration of Trust. On December 18, 1997 and November 18, 1999, the
Board approved several additional changes to the form of the New
Declaration of Trust, which changes have been incorporated into the
form attached to this Proxy Statement. On November 18, 1999 and
December 16, 1999, the Board authorized the submission of the New
Declaration of Trust to the trust's shareholders for their
authorization at this Meeting.
The New Declaration of Trust amends the Current Declaration of Trust
in a number of significant ways. The following discussion summarizes
some of the more significant amendments to the Current Declaration of
Trust effected by the New Declaration of Trust.
IN ADDITION TO THE CHANGES DESCRIBED BELOW, THERE ARE OTHER
SUBSTANTIVE AND STYLISTIC DIFFERENCES BETWEEN THE NEW DECLARATION OF
TRUST AND THE CURRENT DECLARATION OF TRUST. THE FOLLOWING SUMMARY IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE NEW DECLARATION OF TRUST
ITSELF, WHICH IS ATTACHED AS EXHIBIT 1 TO THIS PROXY STATEMENT.
SIGNIFICANT CHANGES EFFECTED BY THE NEW DECLARATION OF TRUST.
REORGANIZATION OR TERMINATION OF THE TRUST OR ITS SERIES OR CLASSES.
Unlike the Current Declaration of Trust, the New Declaration of Trust
generally permits the Trustees, subject to applicable Federal and
state law, to reorganize or terminate all or a portion of the trust or
any of its series or classes. The Current Declaration of Trust
requires shareholder approval in order to reorganize or terminate the
trust or any of its series.
Under certain circumstances, it may not be in the shareholders'
interest to require a shareholder meeting to permit all or a portion
of the trust, a fund or class to reorganize into another entity. For
example, in order to reduce the cost and scope of state regulatory
constraints or to take advantage of a more favorable tax treatment
offered by another state, the Trustees may determine that it would be
in the shareholders' interests to reorganize a fund to domicile it in
another state or to change its legal form. Under the Current
Declaration of Trust, the Trustees cannot effectuate such a
potentially beneficial reorganization without first conducting a
shareholder meeting and incurring the attendant costs and delays. In
contrast, the New Declaration of Trust gives the Trustees the
flexibility to reorganize all or a portion of the trust or any of its
series or classes and achieve potential shareholder benefits without
incurring the delay and potential costs of a proxy solicitation. Such
flexibility should help to assure that the trust and its funds operate
under the most appropriate form of organization.
Similarly, under certain circumstances, it may not be in the
shareholders' interest to require a shareholder meeting to permit the
Trustees to terminate a fund or class. For example, a fund may have
insufficient assets to invest effectively or excessively high expense
levels due to operational needs. Under such circumstances, absent
viable alternatives, the Trustees may determine that terminating the
fund is in the shareholders' interest and the only appropriate course
of action. The process of obtaining shareholder approval of the fund's
termination may, however, make it more difficult to complete the
fund's liquidation and termination and, in general, will increase the
costs associated with the termination. In such a case, it may be in
the shareholders' interest to permit fund termination without
incurring the costs and delays of a shareholder meeting.
As discussed above, before allowing a trust, fund, or class
reorganization or termination to proceed without shareholder approval,
the Trustees have a fiduciary responsibility to first determine that
the proposed transaction is in the shareholders' interest. Any
exercise of the Trustees' increased authority under the New
Declaration of Trust is also subject to any applicable requirements of
the 1940 Act and Massachusetts law. Of course, in all cases, the New
Declaration of Trust would require that shareholders receive written
notification of any proposed transaction.
The New Declaration of Trust does NOT give the Trustees the authority
to merge a fund or class with another operating mutual fund or sell
all or a portion of a class's or fund's assets to another operating
mutual fund without first seeking shareholder approval. Under the New
Declaration of Trust, shareholder approval is still required for these
transactions.
FUTURE AMENDMENTS OF THE DECLARATION OF TRUST. The New Declaration of
Trust permits the Trustees, with certain exceptions, to amend the
Declaration of Trust without shareholder approval. Under the New
Declaration of Trust, shareholders generally have the right to vote on
any amendment affecting their right to vote, on any amendment altering
the maximum number of permitted Trustees, on any amendment affecting
the New Declaration of Trust's amendment provisions, on any amendment
required by law or the trust's registration statement, and on any
matter submitted to shareholders by the Trustees. The Current
Declaration of Trust, on the other hand, generally gives shareholders
the exclusive power to amend the Declaration of Trust. By allowing
amendment of the Declaration of Trust without shareholder approval,
the New Declaration of Trust gives the Trustees the necessary
authority to react quickly to future contingencies. As mentioned
above, such increased authority remains subordinate to the Trustees'
continuing fiduciary obligations to act with due care and in the
shareholders' interest.
REFERENCES TO CLASSES. The New Declaration of Trust includes explicit
references to "classes" of a fund in appropriate places throughout the
document. Classes are often a more efficient way of offering a
specific investment strategy to different types of investors without
creating separate funds for each type of investor. Each class
represents an interest in the same portfolio of securities but may be
offered with different service features, distribution arrangements or
fees. Although the Trustees are not prohibited from authorizing the
issuance of classes of shares under the Current Declaration of Trust,
the Trustees believe that it is appropriate to explicitly describe
their ability, without a vote of Shareholders, to establish new
classes of shares, to change or abolish existing classes of shares, to
divide an existing fund into classes of shares, and to take any other
action with respect to classes that they deem appropriate.
INVESTMENT IN OTHER INVESTMENT COMPANIES. The New Declaration of
Trust clarifies that the Trustees may authorize the investment of a
portion of a fund's assets in one or more open-end investment
companies (Fund-of-Funds Structure). The current Declaration of Trust
explicitly allows the Trustees to authorize the fund to invest all of
its assets in a single open-end investment company but does not
specifically provide the Trustees with the ability to invest a portion
of its assets in one or more investment companies. In a Fund-of-Funds
Structure, each fund retains its own characteristics, but is able to
achieve efficiencies by consolidating portfolio management for some or
all of its assets with other funds or to achieve other operational
efficiencies. The purpose of the Fund-of-Funds Structure generally is
to achieve operational efficiencies by consolidating portfolio
management for a portion of a fund's assets with other funds which
invest a portion of their assets similarly. For example, three
different funds with different allocations among stocks, bonds and
money market investments but similar investment policies within each
asset class might each invest in the same stock, bond and money market
funds. The Fund-of-Funds Structure allows multiple funds with similar
investment policies for a portion of their assets to consolidate
portfolio management in a single pool for their assets that are
managed similarly. FMR and the Board of Trustees continually review
methods of structuring mutual funds to take advantage of potential
efficiencies or other benefits. While neither FMR nor the Trustees
have determined that a Fund-of-Funds Structure is appropriate at this
time, the Trustees believe it could be in the best interests of each
fund to adopt such a structure at a future date. If approved, the New
Declaration of Trust would provide the Trustees with the power to
authorize a fund to invest all or a portion of its assets in one or
more open-end investment companies. The Trustees will authorize such a
transaction only if a Fund-of-Funds Structure is permitted under the
fund's investment policies and if they determine that a Fund-of-Funds
Structure is in the best interests of the fund and its shareholders.
OTHER CHANGES EFFECTED BY THE NEW DECLARATION OF TRUST.
In addition to the significant changes above, the New Declaration of
Trust modifies the Current Declaration of Trust in a number of
important ways, including the following:
1. The New Declaration of Trust modifies the Current Declaration of
Trust to allow FMR to enter into a Management Contract with the trust,
on behalf of each fund, and to amend the fund's respective Management
Contract subject to the provisions of Section 15 of the 1940 Act, as
modified or interpreted by the SEC. In contrast, the Current
Declaration of Trust explicitly requires the vote of a majority of the
outstanding voting securities of a fund to enter into and amend
Management Contracts. A corresponding change is also proposed for the
funds' Management Contracts. For more information on this topic
generally, see "Modification of Management Contract Amendment
Provisions" on pages and .
2. The New Declaration of Trust broadens the authority of the
Trustees to redeem a shareholder for any reason deemed appropriate by
the Trustees. The Trustees' ability to do so would be limited by the
1940 Act and other applicable legal and regulatory requirements. The
Current Declaration of Trust explicitly allows the Trustees only to
redeem shareholders who do not meet a fund's minimum balance
requirement.
3. The New Declaration of Trust explicitly allows the Trustees to
effect Fund-of-Funds Structures, mergers, reorganizations and similar
transactions through any method approved by the Trustees, including
share-for-share exchanges, transfers or sale of assets, shareholder
in-kind redemptions and purchases, and exchange offers.
4. The New Declaration of Trust clarifies that the Trustees may
impose other fees (for example, purchase fees) in addition to sales
charges upon investment in a fund and clarifies that deferred sales
charges and other fees (for example, redemption fees) may be imposed
upon redemption of a fund's shares.
5. The New Declaration of Trust confirms and clarifies various
existing Trustee powers. For example, the New Declaration of Trust
clarifies that the Trustees, in addition to banks and trust companies,
may employ as fund custodians companies that are members of a national
securities exchange or other entities permitted under the 1940 Act;
delegate authority to investment advisers and other agents; adopt and
offer dividend reinvestment and related plans; operate and carry on
the business of an investment company; interpret the investment
policies, practices, and limitations of any fund; and deal in shares
of a fund.
6. The New Declaration of Trust clarifies that no shareholder of a
trust series shall have a claim on the assets of another series and
further clarifies that, by virtue of investing in a fund, a
shareholder is deemed to have assented to and agreed to be bound by
the terms of the New Declaration of Trust.
7. The New Declaration of Trust deletes various technical and/or
antiquated requirements from the Current Declaration of Trust,
including existing requirements that a Trustee vacancy be deemed to
occur when a Trustee is absent from his or her state of residence,
that Trustee vacancies must be filled within six calendar months, and
that portfolio securities be held pursuant to safeguards prescribed by
usual Massachusetts practice.
8. The New Declaration of Trust clarifies that the Trustees may
authorize dividends of fund property in addition to stock dividends.
9. The New Declaration of Trust permits the rights and preferences of
a Series or Class to be set forth in the registration statement for
such Series or Class or in any other document in addition to in a
resolution of the Board of Trustees.
10. Lastly, the New Declaration of Trust generally expands various
1940 Act defined terms to encompass SEC modifications and
interpretations. Specific references to discrete sections of the 1940
Act that are contained in the New Declaration of Trust have likewise
been expanded to include SEC modifications and interpretations.
CONCLUSION. The Board of Trustees has concluded that the proposed
adoption of the New Declaration of Trust is in the best interests of
the trust's shareholders. Accordingly, the Trustees unanimously
recommend that the shareholders vote FOR the proposal to authorize
them to adopt and execute the New Declaration of Trust. If the
proposal is not approved, the Current Declaration of Trust will remain
unchanged and in effect.
4. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR EACH OF FIDELITY
CAPITAL APPRECIATION FUND, FIDELITY DISCIPLINED EQUITY FUND,
FIDELITY STOCK SELECTOR AND FIDELITY VALUE FUND.
The Board of Trustees, including the Trustees who are not "interested
persons" of the Trust or of FMR (the Independent Trustees), has
approved, and recommends that shareholders of each fund approve, a
proposal to adopt an amended management contract with FMR (the Amended
Contract). The Amended Contract modifies several aspects of the
management fee that FMR receives from the funds for managing its
investments and business affairs. In addition, the Amended Contract
allows FMR and the Trust, on behalf of each fund, to modify the
Management Contract subject to the requirements of the 1940 Act. The
existing Management Contract (Present Contract) currently requires the
vote of a majority of the funds' outstanding voting securities to
authorize all amendments. See "Modification of Management Contract
Amendment Provisions" on page 10 for more details. (For information on
FMR, see the section entitled "Activities and Management of FMR," on
page .)
CURRENT MANAGEMENT FEE. The management fee is calculated and paid
monthly, and is normally expressed as an annual percentage of each
fund's average net assets. The fee has two components: a Basic Fee and
a Performance Adjustment. The Basic Fee is an annual percentage of the
fund's average net assets for the current month. The Basic Fee rate is
the sum of a Group Fee rate, which declines as FMR's fund assets under
management increase, and a fixed individual fund fee rate of 0.30%.
The Basic Fee rate for the fiscal year ended October 31, 1999 (not
including the fee amendments discussed below) for Fidelity Capital
Appreciation Fund, Fidelity Disciplined Equity Fund, Fidelity Stock
Selector and Fidelity Value Fund was 0.59%.
The Performance Adjustment is a positive or negative dollar amount
based on the fund's performance and assets for the most recent 36
months. If the fund outperforms the S&P 500(registered trademark) (the
Index) over 36 months, FMR receives a positive Performance Adjustment,
and if the fund underperforms the Index, the management fee is reduced
by a negative Performance Adjustment. The Performance Adjustment is an
annual percentage of the fund's monthly average net assets over the
36-month performance period. The Performance Adjustment rate is 0.02%
for each percentage point of outperformance or underperformance,
subject to a maximum of 0.20% if the fund outperforms or underperforms
the Index by more than ten percentage points. Performance of the fund
and the Index are rounded to the nearest whole percentage point for
purposes of the calculation.
PROPOSED MANAGEMENT FEE AMENDMENTS. The Amended Contract would (1)
reduce the Group Fee rate further if FMR's assets under management
remain over $426 billion, (2) modify the Performance Adjustment
calculation to round the performance of the fund and the Index to the
nearest 0.01%, rather than the nearest 1.00%, and (3) allow FMR and
the Trust, on behalf of the fund, to modify the Management Contract
subject to the requirements of the 1940 Act. Each fund's existing
Management Contract currently requires the vote of a majority of the
fund's outstanding voting securities to authorize all amendments. See
"Modification of Management Contract Amendment Provisions" on page 11
for more details.
IMPACT OF GROUP FEE RATE REDUCTION. At FMR's current level of assets
under management (approximately $800 billion as of November 30, 1999),
the changes to the Group Fee rate reduce the management fee. FMR has
voluntarily implemented the Group Fee reductions pending shareholder
approval, and each Fund has paid lower management fees as a result.
The following chart compares each fund's basic fee as calculated
under the terms of the Present Contract for the fiscal year ended
October 31, 1999 to the management fee each fund would have incurred
if the Amended Contract had been in effect.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Present Contract Management Amended Contract Management Fee Percentage Difference
Fee*
Capital Appreciation Fund 0.5900% 0.5827% (1.24%)
Disciplined Equity Fund 0.5898% 0.5826% (1.22%)
Stock Selector 0.5904% 0.5832% (1.22%)
Value Fund 0.5906% 0.5834% (1.22%)
</TABLE>
* Does not reflect voluntary adoption of extended group fee rate
schedules by FMR on January 1, 1996 and August 1, 1999.
IMPACT OF PERFORMANCE ADJUSTMENT CHANGES. The more precise rounding
method for the Performance Adjustment would have resulted in the
following management fee rate for the fiscal year ended October 31,
1999 for each fund's average net assets for the year:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Present Contract Management Amended Contract Management Fee Percentage Difference
Fee*
Capital Appreciation Fund (0.1543%) (0.1543%) 0.00%
Disciplined Equity Fund (0.1629%) (0.1629%) 0.00%
Stock Selector (0.2081%) (0.2081%) 0.00%
Value Fund (0.2622%) (0.2622%) 0.00%
</TABLE>
* Does not reflect voluntary adoption of extended group fee rate
schedules by FMR on January 1, 1996 and August 1, 1999.
COMBINED EFFECT OF FEE CHANGES. In the fiscal year ended October 31,
1999, the Group Fee reductions and the changes to the Performance
Adjustment would have resulted in the following decrease in the total
management fee for each fund:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Present Contract Management Amended Contract Management Fee Percentage Difference
Fee*
Capital Appreciation Fund 0.4357% 0.4284% (1.68%)
Disciplined Equity Fund 0.4269% 0.4197% (1.69%)
Stock Selector 0.3823% 0.3751% (1.88%)
Value Fund 0.3284% 0.3212% (2.19%)
</TABLE>
* Does not reflect voluntary adoption of extended group fee rate
schedules by FMR on January 1, 1996 and August 1, 1999.
The future impact will depend on many different factors, and may
represent an increase or decrease from the management fee under the
Present Contracts. The Group Fee rate reductions will either reduce
the management fee or leave it unchanged, depending on the level of
FMR's assets under management. Calculating performance to the nearest
0.01% may increase or decrease the Performance Adjustment, depending
on whether performance would have been rounded up or down.
A copy of the Amended Contract, marked to indicate the proposed
amendments, is supplied as Exhibit 2 on page . Except for the
modifications discussed above, the Amended Contract is substantially
identical to each fund's Present Contract with FMR. (For a detailed
discussion of each fund's Present Contract, refer to the section
entitled "Present Management Contracts," on page .) If approved by
shareholders, the Amended Contract will take effect on the first day
of the first month following approval and will remain in effect
through July 31, 2000 and thereafter, but only as long as its
continuance is approved at least annually by (i) the vote, cast in
person at a meeting called for the purpose, of a majority of the
Independent Trustees and (ii) the vote of either a majority of the
Trustees or a majority of the outstanding shares of each fund. If the
Amended Contract is not approved for each fund, the Present Contracts
will continue in effect through July 31, 2000, and thereafter only as
long as its continuance is approved at least annually as described
above.
MODIFICATION TO GROUP FEE RATE. The Group Fee Rate varies based on
the aggregate net assets of all registered investment companies having
management contracts with FMR (group assets). As group assets
increase, the Group Fee Rate declines. The Amended Contract would not
change the Group Fee Rate if group assets are $426 billion or less.
Above $426 billion in group assets, the Group Fee Rate declines under
both Contracts, but under the Amended Contract, it declines faster.
The Group Fee Rate is calculated according to a graduated schedule
providing for different rates for different levels of assets. The rate
at which the Group Fee Rate declines is determined by fee
"breakpoints" that provide for lower fee rates when group assets
increase. The Amended Contract adds 13 new, lower breakpoints
applicable when group assets are above $426 billion as illustrated in
the following table. (For an explanation of how the Group Fee Rate is
used to calculate the management fee, see the section entitled
"Present Management Contracts" on page .)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
GROUP FEE RATE BREAKPOINTS
Average Group Assets ($ Present Contract Group Assets ($ billions) Amended Contract
billions)
Over 390 .2700 390 - 426 .2700%
426 - 462 .2650%
462 - 498 .2600%
498 - 534 .2550%
534 - 587 .2500%
587 - 646 .2463%
646 - 711 .2426%
711 - 782 .2389%
782 - 860 .2352%
860 - 946 .2315%
946 - 1,041 .2278%
1,041 - 1,145 .2241%
1,145 - 1,260 .2204%
Over 1,260 .2167%
</TABLE>
The resulting Group Fee rates at various levels of group assets are
indicated below. (For an explanation of how the breakpoints are
combined to arrive at the Group Fee rate, see "Present Management
Contracts" on page .)
EFFECTIVE ANNUAL GROUP FEE RATES
Group Assets ($ billions) Present Contract Amended Contract
150 .3371% .3371%
200 .3284% .3284%
250 .3219% .3219%
300 .3163% .3163%
350 .3113% .3113%
400 .3067% .3067%
450 .3026% .3024%
500 .2994% .2982%
550 .2967% .2942%
600 .2945% .2904%
650 .2926% .2870%
700 .2910% .2838%
750 .2896% .2809%
800 .2884% .2782%
850 .2873% .2756%
900 .2863% .2732%
950 .2855% .2710%
1,000 .2847% .2689%
1,050 .2840% .2669%
1,100 .2834% .2649%
1,150 .2828% .2631%
1,200 .2822% .2614%
1,250 .2817% .2597%
1,300 .2813% .2581%
1,350 .2809% .2566%
1,400 .2805% .2551%
FMR voluntarily adopted various additional Group Fee breakpoints for
group assets over $426 billion and $587 billion on January 1, 1996 and
August 1, 1999, respectively. Although the new fee breakpoints have
not been added to the management contract pending shareholder
approval, FMR has voluntarily based its management fee on the Group
Fee schedule contained in the Amended Contract since January 1, 1996
and August 1, 1999. Group assets for November 30, 1999 were
approximately $800 billion.
MODIFICATIONS TO PERFORMANCE ADJUSTMENT ROUNDING METHOD. The annual
Performance Adjustment rate equals 0.02% for each percentage point by
which the fund outperforms or underperforms the Index over a 36-month
performance period. Under the Present Contract, the investment
performance of both the fund and the Index are rounded to the nearest
full percentage point (for example, 15.5123% is rounded to 16%.)
Rounding to full percentage points results in the Performance
Adjustment rate being applied in 0.02% increments. In comparison,
under the Amended Contract, the investment performance of both the
fund and Index are rounded to the nearest 0.01% (using the prior
example, 15.5123% is rounded to 15.51%) prior to calculating the
difference in investment performance. The more precise rounding method
results in a more accurate measure of the difference in investment
performance and allows for the Performance Adjustment to be applied in
0.02% increments. This reduces the chance of minor changes in
performance resulting in significant changes to the Performance
Adjustment, and ultimately the fund's management fee.
During fiscal 1999, using the more precise rounding methodology,
there would have been no impact on the funds' management fees.
COMPARISON OF MANAGEMENT FEES. The following tables compare each
fund's management fee as calculated under the terms of the Present
Contracts (not including FMR's voluntary implementation of the Group
Fee reductions) for the fiscal year ended October 31, 1999 to the
management fee each fund would have incurred if the Amended Contract
had been in effect. Management fees are expressed in dollars and as
percentages of each funds' average net assets for the year.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FIDELITY CAPITAL APPRECIATION FUND
Present Contract Amended Contract Difference
$ % $ % $ %
Basic Fee 16,131,000 0.5900 15,932,000 0.5827 (199,000) (0.0073)
Performance Adjustment (4,220,000) (0.1543) (4,220,000) (0.1543) 0 0
Total Management Fee 11,911,000 0.4357 11,712,000 0.4284 (199,000) (0.0073)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FIDELITY DISCIPLINED EQUITY FUND
Present Contract Amended Contract Difference
$ % $ % $ %
Basic Fee 18,691,000 0.5898 18,461,000 0.5826 (230,000) (0.0072)
Performance Adjustment (5,161,000) (0.1629) (5,161,000) (0.1629) 0 0
Total Management Fee 13,530,000 0.4269 13,300,000 0.4197 (230,000) (0.0072)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FIDELITY STOCK SELECTOR
Present Contract Amended Contract Difference
$ % $ % $ %
Basic Fee 9,897,000 0.5904 9,776,000 0.5832 (121,000) (0.0072)
Performance Adjustment (3,488,000) (0.2081) (3,488,000) (0.2081) 0 0
Total Management Fee 6,409,000 0.3823 6,288,000 0.3751 (121,000) (0.0072)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FIDELITY VALUE FUND
Present Contract Amended Contract Difference
$ % $ % $ %
Basic Fee 31,369,000 0.5906 30,988,000 0.5834 (381,000) (0.0072)
Performance Adjustment (13,924,000) (0.2622) (13,924,000) (0.2622) 0 0
Total Management Fee 17,445,000 0.3284 17,064,000 0.3212 (381,000) (0.0072)
</TABLE>
The following table provides data concerning each fund's management
fees and expenses as a percentage of average net assets for the fiscal
year ended October 31, 1999 under the Present Contracts (not including
FMR's voluntary implementation of the Group Fee reductions) and if the
Amended Contract had been in effect during the same period.
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.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
COMPARATIVE FEE TABLE
Annual Fund Operating Expenses (as a percentage of average net assets)
Present Contract Amended Contract
Management Fee Other Expenses Total Fund Operating Expenses Management Fee Other
Expenses
Fidelity Capital Appreciation 0.44% 0.24% 0.68% 0.43% 0.24%
Fund
Fidelity Disciplined Equity 0.43% 0.23% 0.66% 0.42% 0.23%
Fund
Fidelity Stock Selector 0.38% 0.24% 0.62% 0.38% 0.24%
Fidelity Value Fund 0.33% 0.24% 0.57% 0.32% 0.24%
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
COMPARATIVE FEE TABLE
Annual Fund Operating Expenses (as a percentage of average net assets)
Total Fund Operating Expenses
Fidelity Capital Appreciation 0.67%
Fund
Fidelity Disciplined Equity 0.65%
Fund
Fidelity Stock Selector 0.62%
Fidelity Value Fund 0.56%
</TABLE>
A portion of the brokerage commissions that each fund pays is used to
reduce each fund's expenses. Each fund has entered into arrangements
with its custodian and transfer agent whereby credits realized as a
result of uninvested cash balances are used to reduce custodian and
transfer agent expenses. Including these reductions, the total
operating expenses presented in the table would have been:
<TABLE>
<CAPTION>
<S> <C> <C>
Present Contract Amended Contract
Total Fund Operating Expenses Total Fund Operating Expenses
Fidelity Capital Appreciation 0.66% 0.65%
Fund
Fidelity Disciplined Equity 0.63% 0.62%
Fund
Fidelity Stock Selector 0.59% 0.59%
Fidelity Value Fund 0.55% 0.54%
</TABLE>
EXAMPLE: The following illustrates the expenses on a $10,000
investment under the fees and expenses stated above, assuming (1) 5%
annual return and (2) redemption at the end of each time period:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Present Contract Amended Contract
1 Year 3 Years 5 Years 10 Years 1 Year 3 Years 5 Years 10 Years
Fidelity Capital Appreciation $ 69 $ 218 $ 379 $ 847 $ 68 $ 214 $ 373 $ 835
Fund
Fidelity Disciplined Equity $ 67 $ 211 $ 368 $ 822 $ 66 $ 208 $ 362 $ 810
Fund
Fidelity Stock Selector $ 63 $ 199 $ 346 $ 774 $ 63 $ 199 $ 346 $ 774
Fidelity Value Fund $ 58 $ 183 $ 318 $ 714 $ 57 $ 179 $ 313 $ 701
</TABLE>
The purpose of this example and the table is to assist investors in
understanding the various costs and expenses of investing in shares of
the fund. The example above should not be considered a representation
of past or future expenses of the fund. Actual expenses may vary from
year to year and may be higher or lower than those shown above.
MODIFICATION OF MANAGEMENT CONTRACT AMENDMENT PROVISIONS. The Amended
Contract allows FMR and the Trust, on behalf of each fund, to amend
the Management Contracts subject to the provisions of Section 15 of
the 1940 Act, as modified or interpreted by the Securities and
Exchange Commission. In contrast, the Present Contracts explicitly
require the vote of a majority of the outstanding voting securities of
each fund to authorize all amendments. Generally, the proposed
modification to the Present Contracts' amendment provisions will allow
FMR and the Trust, on behalf of each fund, to amend the Management
Contract without shareholder vote IF THE 1940 ACT PERMITS THEM TO DO
SO. For example, under current interpretations of Section 15 of the
1940 Act, the Amended Contract would give FMR and the Trust the
ability to amend the Management Contracts to immediately reflect a
management fee decrease without the delay of having to first conduct a
proxy solicitation. In short, the proposed modification gives FMR and
the Trust added flexibility to amend the Management Contracts subject
to 1940 Act constraints. Of course, any future amendments to the
Management Contract would require the approval of each fund's Board of
Trustees.
MATTERS CONSIDERED BY THE BOARD
The mutual funds for which the members of the Board of Trustees serve
as Trustees are referred to herein as the "Fidelity funds." The Board
of Trustees meets eleven times a year. The Board of Trustees,
including the Independent Trustees, believe that matters bearing on
the appropriateness of each fund's management fees are considered at
most, if not all, of their meetings. While the full Board of Trustees
or the Independent Trustees, as appropriate, act on all major matters,
a significant portion of the activities of the Board of Trustees
(including certain of those described herein) are conducted through
committees. The Independent Trustees meet frequently in executive
session and are advised by independent legal counsel selected by the
Independent Trustees.
The proposal to present the Amended Contract to shareholders was
approved by the Board of Trustees of each fund, including all of the
Independent Trustees, on July 15, 1999 and October 14, 1999. The Board
of Trustees considered and approved the modifications to the Group Fee
Rate schedule during the two month period from September to October
1999 and November to December 1995, and the modifications to the
Performance Adjustment calculation during the period from June to July
1995. The Board of Trustees received materials relating to the Amended
Contract in advance of the meeting at which the Amended Contract was
considered, and had the opportunity to ask questions and request
further information in connection with such consideration.
INFORMATION RECEIVED BY THE INDEPENDENT TRUSTEES. In connection with
their monthly meetings, the Trustees received materials specifically
relating to the Amended Contract. These materials included: (i)
information on the investment performance of each fund, a peer group
of funds and an appropriate index or combination of indices, (ii)
sales and redemption data in respect of each fund, and (iii) the
economic outlook and the general investment outlook in the markets in
which each fund invests. The Board of Trustees and the Independent
Trustees also consider periodically other material facts such as (1)
FMR's results and financial condition, (2) arrangements in respect of
the distribution of each fund's shares, (3) the procedures employed to
determine the value of each fund's assets, (4) the allocation of each
fund's brokerage, if any, including allocations to brokers affiliated
with FMR and the use of "soft" commission dollars to pay fund expenses
and to pay for research and other similar services, (5) FMR's
management of the relationships with each fund's custodian and
subcustodians, (6) the resources devoted to and the record of
compliance with each fund's investment policies and restrictions and
with policies on personal securities transactions and (7) the nature,
cost, and character of non-investment management services provided by
FMR and its affiliates.
In response to questions raised by the Independent Trustees,
additional information was furnished by FMR including, among other
items, information on and analysis of (a) the overall organization of
FMR, (b) the impact of performance adjustments to management fees, (c)
the choice of performance indices and benchmarks, (d) the composition
of peer groups of funds, (e) transfer agency and bookkeeping fees paid
to affiliates of FMR, (f) investment performance, (g) investment
management staffing, (h) the potential for achieving further economies
of scale, (i) operating expenses paid to third parties, and (j) the
information furnished to investors, including each fund's
shareholders.
In considering the Amended Contract, the Board of Trustees and the
Independent Trustees did not identify any single factor as
all-important or controlling, and the following summary does not
detail all of the matters considered. Matters considered by the Board
of Trustees and the Independent Trustees in connection with their
approval of the Amended Contract include the following:
BENEFITS TO SHAREHOLDERS. The Board of Trustees and the Independent
Trustees considered the benefit to shareholders of investing in a fund
that is part of a large family of funds offering a variety of
investment disciplines and providing for a large variety of fund and
shareholder services. With regard to the proposed modification to the
Present Contract's amendment provisions, the Board of Trustees and the
Independent Trustees considered the benefit to shareholders of FMR's
and the trust's increased flexibility (within 1940 Act constraints) to
amend the Management Contract without the delays and potential costs
of a proxy solicitation.
INVESTMENT COMPLIANCE AND PERFORMANCE. The Board of Trustees and the
Independent Trustees considered whether each fund has operated within
its investment objective and its record of compliance with its
investment restrictions. They also reviewed monthly each fund's
investment performance as well as the performance of a peer group of
mutual funds, and the performance of an appropriate index or
combination of indices.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the
Independent Trustees review at least annually the background of each
fund's portfolio manager, and each fund's investment objective and
discipline. The Independent Trustees have also had discussions with
senior management of FMR responsible for investment operations, and
the senior management of Fidelity's equity group. Among other things
they considered the size, education and experience of FMR's investment
staff, its use of technology, and FMR's approach to recruiting,
training and retaining portfolio managers and other research, advisory
and management personnel.
NATURE AND QUALITY OF OTHER SERVICES. The Board of Trustees and the
Independent Trustees considered the nature, quality, cost and extent
of administrative and shareholder services performed by FMR and
affiliated companies, both under the Present Contracts and the Amended
Contract and under separate agreements covering transfer agency
functions and pricing, bookkeeping and securities lending services, if
any. The Board of Trustees and the Independent Trustees have also
considered the nature and extent of FMR's supervision of third party
service providers, principally custodians and subcustodians.
EXPENSES. The Board of Trustees and the Independent Trustees
considered each fund's expense ratio and expense ratios of a peer
group of funds. They also considered the amount and nature of fees
paid by shareholders.
PROFITABILITY. The Board of Trustees and the Independent Trustees
considered the level of FMR's profits in respect of the management of
the Fidelity funds, including each fund. This consideration included
an extensive review of FMR's methodology in allocating its costs to
the management of each fund. The Board of Trustees and the Independent
Trustees have concluded that the cost allocation methodology employed
by FMR has a reasonable basis and is appropriate in light of all of
the circumstances. They considered the profits realized by FMR in
connection with the operation of the fund and whether the amount of
profit is a fair entrepreneurial profit for the management of each
fund. They also considered the profits realized from non-fund
businesses which may benefit from or be related to each fund's
business. The Board of Trustees and the Independent Trustees also
considered FMR's profit margins in comparison with available industry
data, both accounting for and ignoring marketing expenses.
ECONOMIES OF SCALE. The Board of Trustees and the Independent
Trustees considered whether there have been economies of scale in
respect of the management of the Fidelity funds, whether the Fidelity
funds (including each fund) have appropriately benefitted from any
economies of scale, and whether there is potential for realization of
any further economies of scale. The Board of Trustees and the
Independent Trustees have concluded that FMR's mutual fund business
presents some limited opportunities to realize economies of scale and
that these economies are being shared between fund shareholders and
FMR in an appropriate manner. The Independent Trustees have also
concluded that the existing group fee structure should be continued
but determined that it would be appropriate to change the group fee
structure as proposed herein.
OTHER BENEFITS TO FMR. The Board of Trustees and the Independent
Trustees also considered the character and amount of fees paid by each
fund and each fund's shareholders for services provided by FMR and its
affiliates, including fees for services like transfer agency, fund
accounting and direct shareholder services. They also considered the
allocation of fund brokerage to brokers affiliated with FMR and the
receipt of sales loads and payments under Rule 12b-1 plans in respect
of certain of the Fidelity funds. The Board of Trustees and the
Independent Trustees also considered the revenues and profitability of
FMR businesses other than its mutual fund business, including FMR's
retail brokerage, correspondent brokerage, capital markets, trust,
investment advisory, pension record keeping, credit card, insurance,
publishing, real estate, international research and investment funds,
and others. The Board of Trustees and the Independent Trustees
considered the intangible benefits that accrue to FMR and its
affiliates by virtue of their relationship with each fund.
CONCLUSION. In considering the Amended Contract, the Board of
Trustees and the Independent Trustees did not identify any single
factor as all-important or controlling, and the foregoing summary does
not detail all of the matters considered. Based on their evaluation of
all material factors and assisted by the advice of independent
counsel, the Trustees concluded (i) that the existing management fee
structure is fair and reasonable and (ii) that the proposed
modifications to the management fee rates, that is the reduction of
the Group Fee Rate schedule and the modifications to the performance
adjustment calculation, and the proposed modification to the Present
Contracts' amendment provisions, are in the best interest of each
fund's shareholders. The Board of Trustees, including the Independent
Trustees, voted to approve the submission of the Amended Contract to
shareholders of each fund and recommends that shareholders of each
fund vote FOR the Amended Contract. If approved, the Amended Contract
will take effect for each fund on the first day of the first month
following shareholder approval.
5. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR FIDELITY SMALL CAP
SELECTOR.
The Board of Trustees, including the Trustees who are not "interested
persons" of the Trust or of FMR (the Independent Trustees), has
approved, and recommends that shareholders of the fund approve, a
proposal to adopt an amended management contract with FMR (the Amended
Contract). The Amended Contract modifies the management fee that FMR
receives from the fund to provide for lower fees when FMR's assets
under management exceed certain levels. (For information on FMR, see
the section entitled "Activities and Management of FMR," on page .)
CURRENT MANAGEMENT FEE. The management fee is calculated and paid
monthly, and is normally expressed as an annual percentage of the
fund's average net assets. The fee has two components: a Basic Fee and
a Performance Adjustment. The Basic Fee is an annual percentage of the
fund's average net assets for the current month. The Basic Fee rate is
the sum of a Group Fee rate, which declines as FMR's fund assets under
management increase, and a fixed individual fund fee rate of 0.35%.
The Basic Fee rate for the fund's fiscal period ended October 31, 1999
(not including the fee amendments discussed below) was 0.63%.
The Performance Adjustment is a positive or negative dollar amount
based on the fund's performance and assets for the most recent 36
months. If the fund outperforms the Russell 2000 (the Index) over 36
months, FMR receives a positive Performance Adjustment, and if the
fund underperforms the Index, the management fee is reduced by a
negative Performance Adjustment. The Performance Adjustment is an
annual percentage of the fund's monthly average net assets over the
36-month performance period. The Performance Adjustment rate is 0.02%
for each percentage point of outperformance or underperformance,
subject to a maximum of 0.20% if the fund outperforms or underperforms
the Index by more than ten percentage points. For the period ended
September 30, 1999, performance of the fund and the Index was rounded
to the nearest whole percentage point for purposes of the calculation.
From October 1, 1999, performance of the fund and the Index is rounded
to the nearest 0.01% for purposes of the calculation.
PROPOSED MANAGEMENT FEE AMENDMENTS. The Amended Contract would reduce
the Group Fee rate further if FMR's assets under management remain
over $587 billion. If approved by shareholders, the Amended Contract
will take effect on the first day of the first month following
approval and will remain in effect through July 31, 2000 and
thereafter, but only as long as its continuance is approved at least
annually by (i) the vote, cast in person at a meeting called for the
purpose, of a majority of the Independent Trustees and (ii) the vote
of either a majority of the Trustees or a majority of the outstanding
shares of the fund. If the Amended Contract is not approved, the
Present Contract will continue in effect through July 31, 2000, and
thereafter only as long as its continuance is approved at least
annually as described above.
IMPACT OF GROUP FEE RATE REDUCTION. At FMR's current level of assets
under management (approximately $800 billion as of November 30, 1999,
the changes to the Group Fee rate reduce the management fee. FMR has
voluntarily implemented the Group Fee reductions pending shareholder
approval, and the fund has paid lower management fees as a result. For
the fund's fiscal year ended October 31, 1999, the management fee
using the proposed Group Fee reductions (including the Performance
Adjustment) was 0.4688% of the fund's average net assets. The Group
Fee reductions lowered the management fee rate by 0.0003% compared to
the rate FMR was entitled to receive under the Present Contract
0.4691%.
MODIFICATION TO GROUP FEE RATE. The Group Fee Rate varies based on
the aggregate net assets of all registered investment companies having
management contracts with FMR (group assets). As group assets
increase, the Group Fee Rate declines. The Amended Contract would not
change the Group Fee Rate if group assets are $587 billion or less.
Above $587 billion in group assets, the Group Fee Rate declines under
both contracts, but under the Amended Contract, it declines faster.
The Group Fee Rate is calculated according to a graduated schedule
providing for different rates for different levels of group assets.
The rate at which the Group Fee Rate declines is determined by fee
"breakpoints" that provide for lower fee rates when group assets
increase. The Amended Contract adds 9 new, lower breakpoints
applicable when group assets are above $587 billion as illustrated in
the following table. (For an explanation of how the Group Fee Rate is
used to calculate the management fee see the section entitled "Present
Management Contracts" on page .)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
GROUP FEE RATE BREAKPOINTS
Average Group Assets ($ Present Contract Group Assets ($ billions) Amended Contract
billions)
Over 534 .2500% 534 - 587 .2500%
587 - 646 .2463%
646 - 711 .2426%
711 - 782 .2389%
782 - 860 .2352%
860 - 946 .2315%
946 - 1,041 .2278%
1,041 - 1,145 .2241%
1,145 - 1,260 .2204%
over 1,260 .2167%
</TABLE>
The resulting Group Fee rates at various levels of group assets are
indicated below. (For an explanation of how the breakpoints are
combined to arrive at the Group Fee rate, see "Present Management
Contracts" on page .)
EFFECTIVE ANNUAL GROUP FEE RATES
Group Assets ($ billions) Present Contract Amended Contract
150 .3371% .3371%
200 .3284% .3284%
250 .3219% .3219%
300 .3163% .3163%
350 .3113% .3113%
400 .3067% .3067%
450 .3024% .3024%
500 .2982% .2982%
550 .2942% .2942%
600 .2905% .2904%
650 .2874% .2870%
700 .2847% .2838%
750 .2824% .2809%
800 .2804% .2782%
850 .2786% .2756%
900 .2770% .2732%
950 .2756% .2710%
1,000 .2743% .2689%
1,050 .2731% .2669%
1,100 .2721% .2649%
1,150 .2711% .2631%
1,200 .2702% .2614%
1,250 .2694% .2597%
1,300 .2687% .2581%
1,350 .2680% .2566%
1,400 .2673% .2551%
FMR voluntarily adopted various additional Group Fee breakpoints for
group assets over $587 billion on August 1, 1999. Although the new fee
breakpoints have not been added to the management contract pending
shareholder approval, FMR has voluntarily based its management fee on
the Group Fee schedule contained in the Amended Contract since August
1, 1999. Group assets for November 30, 1999 were approximately $800
billion.
COMPARISON OF MANAGEMENT FEES. The following table compares the
fund's management fee as calculated under the terms of the Present
Contract (not including FMR's voluntary implementation of the Group
Fee reductions) for the twelve month period ended October 31, 1999 to
the management fee the fund would have incurred if the Amended
Contract had been in effect. Management fees are expressed in dollars
and as percentages of the fund's average net assets for the year.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FIDELITY SMALL CAP SELECTOR
Present Contract Amended Contract Difference
$ % $ % $ %
Basic Fee 3,940,801 0.6351 3,938,464 0.6348 (2,337) (0.0003)
Performance Adjustment* (1,029,739) (0.1660) (1,029,739) (0.1660) 0 0
Total Management Fee 2,911,062 0.4691 2,908,725 0.4688 (2,337) (0.0003)
</TABLE>
* On September 15, 1999, shareholders of the fund approved a
modification to the performance adjustment calculation. Prior to
October 1, 1999, the performance adjustment was calculated to the
nearest whole percentage point.
MATTERS CONSIDERED BY THE BOARD
The mutual funds for which the members of the Board of Trustees serve
as Trustees are referred to herein as the "Fidelity funds." The Board
of Trustees meets eleven times a year. The Board of Trustees,
including the Independent Trustees, believe that matters bearing on
the appropriateness of the fund's management fees are considered at
most, if not all, of their meetings. While the full Board of Trustees
or the Independent Trustees, as appropriate, act on all major matters,
a significant portion of the activities of the Board of Trustees
(including certain of those described herein) are conducted through
committees. The Independent Trustees meet frequently in executive
session and are advised by independent legal counsel selected by the
Independent Trustees.
The proposal to present the Amended Contract to shareholders was
approved by the Board of Trustees of the fund, including all of the
Independent Trustees, on December 16, 1999. The Board of Trustees
considered and approved the modifications to the Group Fee Rate
schedule during the two month period from September to October 1999.
The Board of Trustees received materials relating to the Amended
Contract in advance of the meeting at which the Amended Contract was
considered, and had the opportunity to ask questions and request
further information in connection with such consideration.
INFORMATION RECEIVED BY THE INDEPENDENT TRUSTEES. In connection with
their monthly meetings, the Trustees received materials specifically
relating to the Amended Contract. These materials included: (i)
information on the investment performance of the fund, a peer group of
funds and an appropriate index or combination of indices, (ii) sales
and redemption data in respect of the fund, and (iii) the economic
outlook and the general investment outlook in the markets in which the
fund invests. The Board of Trustees and the Independent Trustees also
consider periodically other material facts such as (1) FMR's results
and financial condition, (2) arrangements in respect of the
distribution of the fund's shares, (3) the procedures employed to
determine the value of the fund's assets, (4) the allocation of the
fund's brokerage, if any, including allocations to brokers affiliated
with FMR and the use of "soft" commission dollars to pay fund expenses
and to pay for research and other similar services, (5) FMR's
management of the relationships with the fund's custodian and
subcustodians, (6) the resources devoted to and the record of
compliance with the fund's investment policies and restrictions and
with policies on personal securities transactions and (7) the nature,
cost, and character of non-investment management services provided by
FMR and its affiliates.
In response to questions raised by the Independent Trustees,
additional information was furnished by FMR including, among other
items, information on and analysis of (a) the overall organization of
FMR, (b) the impact of performance adjustments to management fees, (c)
the choice of performance indices and benchmarks, (d) the composition
of peer groups of funds, (e) transfer agency and bookkeeping fees paid
to affiliates of FMR, (f) investment performance, (g) investment
management staffing, (h) the potential for achieving further economies
of scale, (i) operating expenses paid to third parties, and (j) the
information furnished to investors, including the fund's shareholders.
In considering the Amended Contract, the Board of Trustees and the
Independent Trustees did not identify any single factor as
all-important or controlling, and the following summary does not
detail all of the matters considered. Matters considered by the Board
of Trustees and the Independent Trustees in connection with their
approval of the Amended Contract include the following:
BENEFITS TO SHAREHOLDERS. The Board of Trustees and the Independent
Trustees considered the benefit to shareholders of investing in a fund
that is part of a large family of funds offering a variety of
investment disciplines and providing for a large variety of fund and
shareholder services. With regard to the proposed modification to the
Present Contract's amendment provisions, the Board of Trustees and the
Independent Trustees considered the benefit to shareholders of FMR's
and the trust's increased flexibility (within 1940 Act constraints) to
amend the Management Contract without the delays and potential costs
of a proxy solicitation.
INVESTMENT COMPLIANCE AND PERFORMANCE. The Board of Trustees and the
Independent Trustees considered whether the fund has operated within
its investment objective and its record of compliance with its
investment restrictions. They also reviewed monthly the fund's
investment performance as well as the performance of a peer group of
mutual funds, and the performance of an appropriate index or
combination of indices.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the
Independent Trustees review at least annually the background of the
fund's portfolio manager, and the fund's investment objective and
discipline. The Independent Trustees have also had discussions with
senior management of FMR responsible for investment operations, and
the senior management of Fidelity's equity group. Among other things
they considered the size, education and experience of FMR's investment
staff, its use of technology, and FMR's approach to recruiting,
training and retaining portfolio managers and other research, advisory
and management personnel.
NATURE AND QUALITY OF OTHER SERVICES. The Board of Trustees and the
Independent Trustees considered the nature, quality, cost and extent
of administrative and shareholder services performed by FMR and
affiliated companies, both under the Present Contract and the Amended
Contract and under separate agreements covering transfer agency
functions and pricing, bookkeeping and securities lending services, if
any. The Board of Trustees and the Independent Trustees have also
considered the nature and extent of FMR's supervision of third party
service providers, principally custodians and subcustodians.
EXPENSES. The Board of Trustees and the Independent Trustees
considered the fund's expense ratio and expense ratios of a peer group
of funds. They also considered the amount and nature of fees paid by
shareholders.
PROFITABILITY. The Board of Trustees and the Independent Trustees
considered the level of FMR's profits in respect of the management of
the Fidelity funds, including the fund. This consideration included an
extensive review of FMR's methodology in allocating its costs to the
management of the fund. The Board of Trustees and the Independent
Trustees have concluded that the cost allocation methodology employed
by FMR has a reasonable basis and is appropriate in light of all of
the circumstances. They considered the profits realized by FMR in
connection with the operation of the fund and whether the amount of
profit is a fair entrepreneurial profit for the management of the
fund. They also considered the profits realized from non-fund
businesses which may benefit from or be related to the fund's
business. The Board of Trustees and the Independent Trustees also
considered FMR's profit margins in comparison with available industry
data, both accounting for and ignoring marketing expenses.
ECONOMIES OF SCALE. The Board of Trustees and the Independent
Trustees considered whether there have been economies of scale in
respect of the management of the Fidelity funds, whether the Fidelity
funds (including the fund) have appropriately benefitted from any
economies of scale, and whether there is potential for realization of
any further economies of scale. The Board of Trustees and the
Independent Trustees have concluded that FMR's mutual fund business
presents some limited opportunities to realize economies of scale and
that these economies are being shared between fund shareholders and
FMR in an appropriate manner. The Independent Trustees have also
concluded that the existing group fee structure should be continued
but determined that it would be appropriate to change the group fee
structure as proposed herein.
OTHER BENEFITS TO FMR. The Board of Trustees and the Independent
Trustees also considered the character and amount of fees paid by the
fund and the fund's shareholders for services provided by FMR and its
affiliates, including fees for services like transfer agency, fund
accounting and direct shareholder services. They also considered the
allocation of fund brokerage to brokers affiliated with FMR and the
receipt of sales loads and payments under Rule 12b-1 plans in respect
of certain of the Fidelity funds. The Board of Trustees and the
Independent Trustees also considered the revenues and profitability of
FMR businesses other than its mutual fund business, including FMR's
retail brokerage, correspondent brokerage, capital markets, trust,
investment advisory, pension record keeping, credit card, insurance,
publishing, real estate, international research and investment funds,
and others. The Board of Trustees and the Independent Trustees
considered the intangible benefits that accrue to FMR and its
affiliates by virtue of their relationship with the fund.
CONCLUSION. In considering the Amended Contract, the Board of
Trustees and the Independent Trustees did not identify any single
factor as all-important or controlling, and the foregoing summary does
not detail all of the matters considered. Based on their evaluation of
all material factors and assisted by the advice of independent
counsel, the Trustees concluded (i) that the existing management fee
structure is fair and reasonable and (ii) that the proposed
modification to the management fee rates, that is the reduction of the
Group Fee Rate schedule, are in the best interest of the fund's
shareholders. The Board of Trustees, including the Independent
Trustees, voted to approve the submission of the Amended Contract to
shareholders of the fund and recommends that shareholders of the fund
vote FOR the Amended Contract. If approved, the Amended Contract will
take effect on the first day of the first month following shareholder
approval.
6. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR FIDELITY TECHNOQUANT
GROWTH FUND.
The Board of Trustees, including the Trustees who are not "interested
persons" of the Trust or of FMR (the Independent Trustees), has
approved, and recommends that shareholders of the fund approve, a
proposal to adopt an amended management contract with FMR (the Amended
Contract). The Amended Contract modifies the management fee that FMR
receives from the fund to provide for lower fees when FMR's assets
under management exceed certain levels. In addition, the Amended
Contract allows FMR and the trust, on behalf of the fund, to modify
the Management Contract subject to the requirements of the 1940 Act.
The existing Management Contract (Present Contract) currently requires
the vote of a majority of the fund's outstanding voting securities to
authorize all amendments. See "Modification of Management Contract
Amendment Provisions" on page for more details. (For information on
FMR, see the section entitled "Activities and Management of FMR" on
page .)
CURRENT MANAGEMENT FEE. The management fee is calculated and paid
monthly, and is normally expressed as an annual percentage of each
fund's average net assets. The fee has two components: a Basic Fee and
a Performance Adjustment. The Basic Fee is an annual percentage of the
fund's average net assets for the current month. The Basic Fee rate is
the sum of a Group Fee rate, which declines as FMR's fund assets under
management increase, and a fixed individual fund fee rate of 0.30%.
The Basic Fee rate for fiscal year ended October 31, 1999 for Fidelity
TechnoQuant Growth Fund was 0.58%.
The Performance Adjustment is a positive or negative dollar amount
based on the fund's performance and assets for the most recent 36
months. If the fund outperforms the S&P 500 (the Index) over 36
months, FMR receives a positive Performance Adjustment, and if the
fund underperforms the Index, the management fee is reduced by a
negative Performance Adjustment. The Performance Adjustment is an
annual percentage of the fund's monthly average net assets over the
36-month performance period. The Performance Adjustment rate is 0.02%
for each percentage point of outperformance or underperformance,
subject to a maximum of 0.20% if the fund outperforms or underperforms
the Index by more than ten percentage points. Performance of the fund
and the Index are rounded to the nearest 0.01% for purposes of the
calculation.
PROPOSED AMENDMENTS TO THE PRESENT MANAGEMENT CONTRACT. A copy of the
Amended Contract, marked to indicate the proposed amendments, is
supplied as Exhibit 4 on page . The Amended Contract would (1) reduce
the Group Fee rate further if FMR's assets under management remain
over $587 billion and (2) allow FMR and the Trust, on behalf of the
fund, to modify the management contract subject to the requirements of
the 1940 Act. If approved by shareholders, the Amended Contract will
take effect on the first day of the first month following approval and
will remain in effect through July 31, 2000 and thereafter, but only
as long as its continuance is approved at least annually by (i) the
vote, cast in person at a meeting called for the purpose, of a
majority of the Independent Trustees and (ii) the vote of either a
majority of the Trustees or a majority of the outstanding shares of
the fund. If the Amended Contract is not approved, the Present
Contract will continue in effect through July 31, 2000, and thereafter
only as long as its continuance is approved at least annually as
described above.
IMPACT OF GROUP FEE RATE REDUCTION. At FMR's current level of assets
under management (approximately $800 billion as of November 30, 1999),
the changes to the Group Fee Rate reduce the management fee. FMR has
voluntarily implemented the Group Fee reductions pending shareholder
approval, and the fund has paid lower management fees as a result. For
the fund's fiscal year ended October 31, 1999, the management fee
using the proposed Group Fee reductions (including the Performance
Adjustment) was 0.3320% of the fund's average net assets. The Group
Fee reductions lowered the management fee rate by 0.0004% compared to
the rate FMR was entitled to receive under the Present Contract
0.3324%.
MODIFICATION TO GROUP FEE RATE. The Group Fee Rate varies based on
the aggregate net assets of all registered investment companies having
management contracts with FMR (group assets). As group assets
increase, the Group Fee Rate declines. The Amended Contract would not
change the Group Fee Rate if group assets are $587 billion or less.
Above $587 billion in group assets, the Group Fee Rate declines under
both Contracts, but under the Amended Contract, it declines faster.
The Group Fee Rate is calculated according to a graduated schedule
providing for different rates for different levels of group assets.
The rate at which the Group Fee Rate declines is determined by fee
"breakpoints" that provide for lower fee rates when group assets
increase. The Amended Contract adds 9 new, lower breakpoints
applicable when group assets are above $587 billion as illustrated in
the following table. (For an explanation of how the Group Fee Rate is
used to calculate the management fee, see the section entitled
"Present Management Contracts" beginning on page .)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
GROUP FEE RATE BREAKPOINTS
PRESENT CONTRACT AMENDED CONTRACT
Average Group Assets ($ Present Contract* Average Group Assets ($ Amended Contract
billions) billions)
Over 534 .2500% 534 - 587 .2500%
587 - 646 .2463%
646 - 711 .2426%
711 - 782 .2389%
782 - 860 .2352%
860 - 946 .2315%
946 - 1,041 .2278%
1,041 - 1,145 .2241%
1,145 - 1,260 .2204%
Over 1,260 .2167%
</TABLE>
The resulting Group Fee Rates at various levels of group assets are
indicated below. (For an explanation of how the breakpoints are
combined to arrive at the Group Fee Rate, see "Present Management
Contracts" on page .)
EFFECTIVE ANNUAL GROUP FEE RATES
Group Assets ($ billions) Present Contract Amended Contract
150 .3371% .3371%
200 .3284% .3284%
250 .3219% .3219%
300 .3163% .3163%
350 .3113% .3113%
400 .3067% .3067%
450 .3024% .3024%
500 .2982% .2982%
550 .2942% .2942%
600 .2905% .2904%
650 .2874% .2870%
700 .2847% .2838%
750 .2824% .2809%
800 .2804% .2782%
850 .2786% .2756%
900 .2770% .2732%
950 .2756% .2710%
1,000 .2743% .2689%
1,050 .2731% .2669%
1,100 .2721% .2649%
1,150 .2711% .2631%
1,200 .2702% .2614%
1,250 .2694% .2597%
1,300 .2687% .2581%
1,350 .2680% .2566%
1,400 .2673% .2551%
FMR voluntarily adopted various additional Group Fee breakpoints for
group assets over $587 billion on August 1, 1999. Although the new fee
breakpoints have not been added to the management contract pending
shareholder approval, FMR has voluntarily based its management fee on
the Group Fee schedule contained in the Amended Contract since August
1, 1999. Group assets for November 30, 1999 were approximately $800
billion.
COMPARISON OF MANAGEMENT FEES. The following table compares the
fund's management fee as calculated under the terms of the Present
Contract (not including FMR's voluntary implementation of the Group
Fee reductions) for the fiscal year ended October 31, 1999 to the
management fee the fund would have incurred if the Amended Contract
had been in effect. Management fees are expressed in dollars and as
percentages of each fund's average net assets for the year.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FIDELITY TECHNOQUANT GROWTH FUND
Present Contract Amended Contract Difference
$ % $ % $ %
Basic Fee 295,130 0.5836 294,928 0.5832 (202) (0.0004)
Performance Adjustment* (127,031) (0.2512) (127,031) (0.2512) 0 0
Total Management Fee 168,099 0.3324 167,897 0.3320 (202) (0.0004)
</TABLE>
MODIFICATION OF MANAGEMENT CONTRACT AMENDMENT PROVISIONS. The Amended
Contract allows FMR and the Trust, on behalf of the fund, to amend the
Management Contract subject to the provisions of Section 15 of the
1940 Act, as modified or interpreted by the Securities and Exchange
Commission. In contrast, the Present Contract explicitly requires the
vote of a majority of the outstanding voting securities of the fund to
authorize all amendments. Generally, the proposed modification to the
Present Contract's amendment provisions will allow FMR and the Trust,
on behalf of the fund, to amend the Management Contract without
shareholder vote IF THE 1940 ACT PERMITS THEM TO DO SO. For example,
under current interpretations of Section 15 of the 1940 Act, the
Amended Contract would give FMR and the Trust the ability to amend the
Management Contract to immediately reflect a management fee decrease
without the delay of having to first conduct a proxy solicitation. In
short, the proposed modification gives FMR and the Trust added
flexibility to amend the Management Contract subject to 1940 Act
constraints. Of course, any future amendments to the Management
Contract would require the approval of the fund's Board of Trustees.
MATTERS CONSIDERED BY THE BOARD
The mutual funds for which the members of the Board of Trustees serve
as Trustees are referred to herein as the "Fidelity funds." The Board
of Trustees meets eleven times a year. The Board of Trustees,
including the Independent Trustees, believe that matters bearing on
the appropriateness of the fund's management fees are considered at
most, if not all, of their meetings. While the full Board of Trustees
or the Independent Trustees, as appropriate, act on all major matters,
a significant portion of the activities of the Board of Trustees
(including certain of those described herein) are conducted through
committees. The Independent Trustees meet frequently in executive
session and are advised by independent legal counsel selected by the
Independent Trustees.
The proposal to present the Amended Contract to shareholders was
approved by the Board of Trustees of the fund, including all of the
Independent Trustees, on October 14, 1999. The Board of Trustees
considered and approved the modifications to the Group Fee Rate
schedule during the two month period from September to October 1999.
The Board of Trustees received materials relating to the Amended
Contract in advance of the meeting at which the Amended Contract was
considered, and had the opportunity to ask questions and request
further information in connection with such consideration.
INFORMATION RECEIVED BY THE INDEPENDENT TRUSTEES. In connection with
their monthly meetings the Trustees received materials specifically
relating to the Amended Contract. These materials included (i)
information on the investment performance of the fund, a peer group of
funds and an appropriate index or combination of indices, (ii) sales
and redemption data in respect of the fund, and (iii) the economic
outlook and the general investment outlook in the markets in which the
fund invests. The Board of Trustees and the Independent Trustees also
consider periodically other material facts such as (1) FMR's results
and financial condition, (2) arrangements in respect of the
distribution of the fund's shares, (3) the procedures employed to
determine the value of the fund's assets, (4) the allocation of the
fund's brokerage, if any, including allocations to brokers affiliated
with FMR and the use of "soft" commission dollars to pay fund expenses
and to pay for research and other similar services, (5) FMR's
management of the relationships with the fund's custodian and
subcustodians, (6) the resources devoted to and the record of
compliance with the fund's investment policies and restrictions and
with policies on personal securities transactions and (7) the nature,
cost and character of non-investment management services provided by
FMR and its affiliates.
In response to questions raised by the Independent Trustees,
additional information was furnished by FMR including, among other
items, information on and analysis of (a) the overall organization of
FMR, (b) the impact of performance adjustments to management fees, (c)
the choice of performance indices and benchmarks, (d) the composition
of peer groups of funds, (e) transfer agency and bookkeeping fees paid
to affiliates of FMR, (f) investment performance, (g) investment
management staffing, (h) the potential for achieving further economies
of scale, (i) operating expenses paid to third parties, and (j) the
information furnished to investors, including the fund's shareholders.
In considering the Amended Contract, the Board of Trustees and the
Independent Trustees did not identify any single factor as
all-important or controlling, and the following summary does not
detail all the matters considered. Matters considered by the Board of
Trustees and the Independent Trustees in connection with their
approval of the Amended Contract include the following:
BENEFITS TO SHAREHOLDERS. The Board of Trustees and the Independent
Trustees considered the benefit to shareholders of investing in a fund
that is part of a large family of funds offering a variety of
investment disciplines and providing for a large variety of fund and
shareholder services. With regard to the proposed modification to the
Present Contract's amendment provisions, the Board of Trustees and the
Independent Trustees considered the benefit to shareholders of FMR's
and the trust's increased flexibility (within 1940 Act constraints) to
amend the Management Contract without the delays and potential costs
of a proxy solicitation.
INVESTMENT COMPLIANCE AND PERFORMANCE. The Board of Trustees and the
Independent Trustees considered whether the fund has operated within
its investment objective and its record of compliance with its
investment restrictions. They also reviewed monthly the fund's
investment performance as well as the performance of a peer group of
mutual funds, and the performance of an appropriate index or
combination of indices.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the
Independent Trustees review at least annually the background of the
fund's portfolio manager and the fund's investment objective and
discipline. The Independent Trustees have also had discussions with
senior management of FMR responsible for investment operations and the
senior management of Fidelity's equity group. Among other things they
considered the size, education and experience of FMR's investment
staff, its use of technology, and FMR's approach to recruiting,
training and retaining portfolio managers and other research, advisory
and management personnel.
NATURE AND QUALITY OF OTHER SERVICES. The Board of Trustees and the
Independent Trustees considered the nature, quality, cost and extent
of administrative and shareholder services performed by FMR and
affiliated companies, both under the Present Contract and the Amended
Contract and under separate agreements covering transfer agency
functions and pricing, bookkeeping and securities lending services, if
any. The Board of Trustees and the Independent Trustees have also
considered the nature and extent of FMR's supervision of third party
service providers, principally custodians and subcustodians.
EXPENSES. The Board of Trustees and the Independent Trustees
considered the fund's expense ratio and expense ratios of a peer group
of funds. They also considered the amount and nature of fees paid by
shareholders.
PROFITABILITY. The Board of Trustees and the Independent Trustees
considered the level of FMR's profits in respect of the management of
the Fidelity funds, including the fund. This consideration included an
extensive review of FMR's methodology in allocating its costs to the
management of the fund. The Board of Trustees and the Independent
Trustees have concluded that the cost allocation methodology employed
by FMR has a reasonable basis and is appropriate in light of all of
the circumstances. They considered the profits realized by FMR in
connection with the operation of the fund and whether the amount of
profit is a fair entrepreneurial profit for the management of the
fund. They also considered the profits realized from non-fund
businesses which may benefit from or be related to the fund's
business. The Board of Trustees and the Independent Trustees also
considered FMR's profit margins in comparison with available industry
data, both accounting for and ignoring marketing expenses.
ECONOMIES OF SCALE. The Board of Trustees and the Independent
Trustees considered whether there have been economies of scale in
respect of the management of the Fidelity funds, whether the Fidelity
funds (including the fund) have appropriately benefitted from any
economies of scale, and whether there is potential for realization of
any further economies of scale. The Board of Trustees and the
Independent Trustees have concluded that FMR's mutual fund business
presents some limited opportunities to realize economies of scale and
that these economies are being shared between fund shareholders and
FMR in an appropriate manner. The Independent Trustees have also
concluded that the existing group fee structure should be continued
but determined that it would be appropriate to change the group fee
structure as proposed herein.
OTHER BENEFITS TO FMR. The Board of Trustees and the Independent
Trustees also considered the character and amount of fees paid by the
fund and the fund's shareholders for services provided by FMR and its
affiliates, including fees for services like transfer agency, fund
accounting and direct shareholder services. They also considered the
allocation of fund brokerage to brokers affiliated with FMR and the
receipt of sales loads and payments under Rule 12b-1 plans in respect
of certain of the Fidelity funds. The Board of Trustees and the
Independent Trustees also considered the revenues and profitability of
FMR businesses other than its mutual fund business, including FMR's
retail brokerage, correspondent brokerage, capital markets, trust,
investment advisory, pension record keeping, insurance, publishing,
real estate, international research and investment funds, and others.
The Board of Trustees and the Independent Trustees considered the
intangible benefits that accrue to FMR and its affiliates by virtue of
their relationship with the fund.
CONCLUSION. In considering the Amended Contract, the Board of
Trustees and the Independent Trustees did not identify any single
factor as all-important or controlling, and the foregoing summary does
not detail all of the matters considered. Based on their evaluation of
all material factors and assisted by the advice of independent
counsel, the Trustees concluded (i) that the existing management fee
structure is fair and reasonable and (ii) that the proposed
modifications to the management fee structure, that is the reduction
of the Group Fee Rate schedule and the proposed modification to the
Present Contract's amendment provisions, are in the best interest of
the fund's shareholders. The Board of Trustees, including the
Independent Trustees, voted to approve the submission of the Amended
Contract to shareholders of the fund and recommends that shareholders
of the fund vote FOR the Amended Contract. If approved, the Amended
Contract will take effect on the first day of the first month
following shareholder approval.
7. TO APPROVE AN AMENDED SUB-ADVISORY AGREEMENT WITH FMR U.K. FOR EACH
OF FIDELITY CAPITAL APPRECIATION FUND, FIDELITY DISCIPLINED EQUITY
FUND, FIDELITY STOCK SELECTOR, FIDELITY TECHNOQUANT GROWTH FUND AND
FIDELITY VALUE FUND.
The Board of Trustees, including the Trustees who are not "interested
persons" of the Trust or of FMR (the Independent Trustees), has
approved, and recommends that shareholders of each fund approve, a
proposal to adopt an amended sub-advisory agreement among FMR, FMR
U.K., and the trust with respect to the fund (the Amended Agreement).
Each fund's Amended Agreement would allow FMR, FMR U.K., and the
trust, on behalf of the fund, to modify the Amended Agreement subject
to the requirements of the 1940 Act. Each fund's existing sub-advisory
agreement (the Present Agreement) requires the vote of a majority of
the fund's outstanding voting securities to authorize all amendments.
FMR PAYS ALL OF FMR U.K.'S FEES UNDER EACH FUND'S AMENDED AGREEMENT.
EACH FUND'S AMENDED AGREEMENT WOULD NOT AFFECT THE FEES THAT THE FUND
PAYS TO FMR UNDER ITS PRESENT MANAGEMENT CONTRACT.
PRESENT AGREEMENTS. Under each fund's Present Agreement, FMR U.K.
acts as an investment consultant to FMR and supplies FMR with
investment research information and portfolio management advice as FMR
reasonably requests on behalf of the fund. FMR U.K. provides
investment advice and research services with respect to issuers
located outside of the United States, focusing primarily on companies
based in Europe. Under each fund's Present Agreement with FMR U.K.,
FMR, NOT THE FUND, pays FMR U.K. a fee equal to 110% of FMR U.K.'s
costs incurred in connection with providing investment advice and
research services.
Furthermore, under each fund's Present Agreement, FMR may grant FMR
U.K. investment management authority with respect to all or a portion
of the fund's assets, as well as the authority to buy and sell stocks,
bonds, and other securities for the fund, subject to the overall
supervision of FMR and the Board of Trustees. To the extent that FMR
grants FMR U.K. investment management authority under each fund's
Present Agreement, FMR, NOT THE FUND, pays FMR U.K. a fee equal to 50%
of FMR's monthly management fee with respect to the fund's average net
assets managed by FMR U.K. on a discretionary basis.
Each fund's Present Agreement requires the vote of a majority of the
fund's outstanding voting securities to authorize all amendments.
PROPOSED AMENDMENTS TO THE PRESENT AGREEMENTS. Each fund's Amended
Agreement would allow FMR, FMR U.K., and the trust, on behalf of the
fund, to amend the Proposed Agreement subject to the provisions of
Section 15 of the 1940 Act, as modified or interpreted by the
Securities and Exchange Commission. In contrast, each fund's Present
Agreement explicitly requires the vote of a majority of the
outstanding voting securities of the fund to authorize all amendments.
Generally, the proposed modification to the Present Agreement's
amendment provisions would allow amendment of the Amended Agreement
without shareholder vote ONLY IF THE 1940 ACT SO PERMITS. In short,
the proposed modification gives FMR, FMR U.K., and the trust added
flexibility to amend the Amended Agreement subject to 1940 Act
constraints. Of course, any future amendments to the Amended Agreement
would require the approval of the Board of Trustees.
On July 15, 1999, the Board of Trustees agreed to submit the Amended
Agreement to shareholders of each fund pursuant to a vote of both the
full Board of Trustees and the Independent Trustees. The Trustees
considered the benefit to shareholders of FMR's, FMR U.K.'s, and the
trust's increased flexibility (within 1940 Act constraints) to amend
the Amended Agreement without the delays and potential costs of a
proxy solicitation.
A corresponding modification is proposed to the amendment provisions
in Fidelity Capital Appreciation Fund's, Fidelity Disciplined Equity
Fund's, Fidelity Stock Selector's, Fidelity TechnoQuant Growth Fund's,
and Fidelity Value Fund's present management contracts. See
"Modification of Management Contract Amendment Provisions" for
Fidelity Capital Appreciation Fund, Fidelity Disciplined Equity Fund,
Fidelity Stock Selector, and Fidelity Value Fund on page and for
Fidelity TechnoQuant Growth Fund on page .
A copy of the form of Amended Agreement for each fund, marked to
indicate the proposed amendments, is supplied as Exhibit 5 beginning
on page . Except for the modifications discussed above, Fidelity
Capital Appreciation Fund's, Fidelity Disciplined Equity Fund's,
Fidelity Stock Selector's, Fidelity TechnoQuant Growth Fund's and
Fidelity Value Fund's Amended Agreements are substantially identical
to their Present Agreements. (For a detailed discussion of each fund's
Present Agreement, refer to the section entitled "Sub-Advisory
Agreements" beginning on page .) If approved by shareholders, each
fund's Amended Agreement will take effect on the first day of the
first month following approval and will remain in effect through July
31, 2000 and from year to year thereafter, but only as long as its
continuance is approved at least annually by (i) the vote, cast in
person at a meeting called for the purpose, of a majority of the
Independent Trustees and (ii) the vote of either a majority of the
Trustees or a majority of the outstanding shares of the fund. Each
fund's Amended Agreement would be terminable on 60 days' written
notice by either party to the agreement and the Amended Agreement
would terminate automatically in the event of its assignment. If a
fund's Amended Agreement is not approved, its Present Agreement will
continue in effect through July 31, 2000 and thereafter only as long
as its continuance is approved at least annually as described above.
FMR would continue to pay all of FMR U.K.'s fees under each fund's
Amended Agreement. If shareholders approve the Amended Agreement, FMR
could, in the future and subject to the approval of the Board of
Trustees, further amend the Amended Agreements to change the fees FMR
pays to FMR U.K. for providing the services described above. IF
SHAREHOLDERS APPROVE THE AMENDED AGREEMENT, FMR COULD NOT, HOWEVER, IN
THE FUTURE AMEND A FUND'S PRESENT MANAGEMENT CONTRACT TO INCREASE THE
FUND'S MANAGEMENT FEE RATE PAYABLE TO FMR THEREUNDER WITHOUT
SHAREHOLDER APPROVAL.
FMR U.K., with its principal office in London, England, is a
wholly-owned subsidiary of FMR established in 1986 to provide
investment research to FMR with respect to foreign securities. This
research complements other research on foreign securities produced by
FMR's U.S.-based research analysts and portfolio managers, or obtained
from broker-dealers or other sources.
FMR U.K. may also provide investment advisory services to FMR with
respect to other investment companies for which FMR serves as
investment adviser, and to other clients. Currently, FMR U.K.'s only
client other than FMR is Fidelity International Limited (FIL), an
affiliate of FMR organized under the laws of Bermuda. FIL provides
investment advisory services to non-U.S. investment companies and
institutional investors investing in securities of issuers throughout
the world. Edward C. Johnson 3d, President and a Trustee of the trust,
is Chairman and a Director of FMR U.K., Chairman and a Director of
FIL, and a principal stockholder of both FIL and FMR. For more
information on FMR U.K., see the section entitled "Activities and
Management of FMR U.K., FMR Far East and FIJ" on page .
CONCLUSION. The Board of Trustees has concluded that the proposal
will benefit each fund and its shareholders. The Trustees recommend
voting FOR the proposal. With respect to each fund, if the Amended
Agreement is approved by shareholders, the Amended Agreement will take
effect on the first day of the first month following approval. If the
Amended Agreement is not approved by shareholders, the Present
Agreement with FMR U.K. will remain in effect.
8. TO APPROVE AN AMENDED SUB-ADVISORY AGREEMENT WITH FMR FAR EAST FOR
EACH OF FIDELITY CAPITAL APPRECIATION FUND, FIDELITY DISCIPLINED
EQUITY FUND, FIDELITY STOCK SELECTOR, FIDELITY TECHNOQUANT GROWTH
FUND AND FIDELITY VALUE FUND.
The Board of Trustees, including the Trustees who are not "interested
persons" of the Trust or of FMR (the Independent Trustees), has
approved, and recommends that shareholders of each fund approve, a
proposal to adopt an amended sub-advisory agreement among FMR, FMR Far
East, and the trust with respect to the fund (the Amended Agreement).
Each fund's Amended Agreement would allow FMR, FMR Far East, and the
trust, on behalf of the fund, to modify the Amended Agreement subject
to the requirements of the 1940 Act. Each fund's existing sub-advisory
agreement (the Present Agreement) requires the vote of a majority of
the fund's outstanding voting securities to authorize all amendments.
FMR PAYS ALL OF FMR FAR EAST'S FEES UNDER EACH FUND'S AMENDED
AGREEMENT. EACH FUND'S AMENDED AGREEMENT WOULD NOT AFFECT THE FEES
THAT THE FUND PAYS TO FMR UNDER ITS PRESENT MANAGEMENT CONTRACT.
PRESENT AGREEMENTS. Under each fund's Present Agreement, FMR Far East
acts as an investment consultant to FMR and supplies FMR with
investment research information and portfolio management advice as FMR
reasonably requests on behalf of the fund. FMR Far East provides
investment advice and research services with respect to issuers
located outside of the United States, focusing primarily on companies
based in the Far East. Under each fund's Present Agreement with FMR
Far East, FMR, NOT THE FUND, pays FMR Far East a fee equal to 105% of
FMR Far East's costs incurred in connection with providing investment
advice and research services. Effective January 1, 2000, FMR Far East,
in turn, has entered into an agreement with Fidelity Investments Japan
Limited (FIJ), a wholly owned subsidiary of Fidelity International
Limited, to provide such investment research and portfolio management
advice as FMR Far East reasonably requests. FMR Far East, NOT THE
FUND, pays FIJ a sub-advisory fee equal to 100% of FIJ's costs
incurred in connection with providing investment advice and research
services.
Furthermore, under each fund's Present Agreement, FMR may grant FMR
Far East investment management authority with respect to all or a
portion of the fund's assets, as well as the authority to buy and sell
stocks, bonds, and other securities for the fund, subject to the
overall supervision of FMR and the Board of Trustees. To the extent
that FMR grants FMR Far East investment management authority under
each fund's Present Agreement, FMR, NOT THE FUND, pays FMR Far East a
fee equal to 50% of FMR's monthly management fee with respect to the
fund's average net assets managed by FMR Far East on a discretionary
basis.
Each fund's Present Agreement requires the vote of a majority of the
fund's outstanding voting securities to authorize all amendments.
PROPOSED AMENDMENTS TO THE PRESENT AGREEMENTS. Each fund's Amended
Agreement would allow FMR, FMR Far East, and the trust, on behalf of
the fund, to amend the Proposed Agreement subject to the provisions of
Section 15 of the 1940 Act, as modified or interpreted by the
Securities and Exchange Commission. In contrast, each fund's Present
Agreement explicitly requires the vote of a majority of the
outstanding voting securities of the fund to authorize all amendments.
Generally, the proposed modification to the Present Agreement's
amendment provisions would allow amendment of the Amended Agreement
without shareholder vote ONLY IF THE 1940 ACT SO PERMITS. In short,
the proposed modification gives FMR, FMR Far East, and the trust added
flexibility to amend the Amended Agreement subject to 1940 Act
constraints. Of course, any future amendments to the Amended Agreement
would require the approval of the Board of Trustees.
On July 15, 1999, the Board of Trustees agreed to submit the Amended
Agreement to shareholders of each fund pursuant to a vote of both the
full Board of Trustees and the Independent Trustees. The Trustees
considered the benefit to shareholders of FMR's, FMR Far East's, and
the trust's increased flexibility (within 1940 Act constraints) to
amend the Amended Agreement without the delays and potential costs of
a proxy solicitation.
A corresponding modification is proposed to the amendment provisions
in Fidelity Capital Appreciation Fund's, Fidelity Disciplined Equity
Fund's, Fidelity Stock Selector's, Fidelity TechnoQuant Growth Fund's,
and Fidelity Value Fund's present management contracts. See
"Modification of Management Contract Amendment Provisions" for
Fidelity Capital Appreciation Fund, Fidelity Disciplined Equity Fund,
Fidelity Stock Selector, and Fidelity Value Fund on page and for
Fidelity TechnoQuant Growth Fund on page .
A copy of the form of Amended Agreement for each fund, marked to
indicate the proposed amendments, is supplied as Exhibit 6 beginning
on page . Except for the modifications discussed above, Fidelity
Capital Appreciation Fund's, Fidelity Disciplined Equity Fund's,
Fidelity Stock Selector's, Fidelity TechnoQuant Growth Fund's and
Fidelity Value Fund's Amended Agreements are substantially identical
to their Present Agreements. (For a detailed discussion of each fund's
Present Agreement, refer to the section entitled "Sub-Advisory
Agreements" beginning on page .) If approved by shareholders, each
fund's Amended Agreement will take effect on the first day of the
first month following approval and will remain in effect through July
31, 2000 and from year to year thereafter, but only as long as its
continuance is approved at least annually by (i) the vote, cast in
person at a meeting called for the purpose, of a majority of the
Independent Trustees and (ii) the vote of either a majority of the
Trustees or a majority of the outstanding shares of the fund. Each
fund's Amended Agreement would be terminable on 60 days' written
notice by either party to the agreement and the Amended Agreement
would terminate automatically in the event of its assignment. If a
fund's Amended Agreement is not approved, its Present Agreement will
continue in effect through July 31, 2000 and thereafter only as long
as its continuance is approved at least annually as described above.
FMR would continue to pay all of FMR Far East's fees under each
fund's Amended Agreement. If shareholders approve the Amended
Agreement, FMR could, in the future and subject to the approval of the
Board of Trustees, further amend the Amended Agreements to change the
fees FMR pays to FMR Far East for providing the services described
above. IF SHAREHOLDERS APPROVE THE AMENDED AGREEMENT, FMR COULD NOT,
HOWEVER, IN THE FUTURE AMEND A FUND'S PRESENT MANAGEMENT CONTRACT TO
INCREASE THE FUND'S MANAGEMENT FEE RATE PAYABLE TO FMR THEREUNDER
WITHOUT SHAREHOLDER APPROVAL.
FMR Far East., with its principal office in Tokyo, Japan, is a
wholly-owned subsidiary of FMR established in 1986 to provide
investment research to FMR with respect to foreign securities. This
research complements other research on foreign securities produced by
FMR's U.S.-based research analysts and portfolio managers, or obtained
from broker-dealers or other sources.
FMR Far East may also provide investment advisory services to FMR
with respect to other investment companies for which FMR serves as
investment adviser, and to other clients. Currently, FMR Far East's
only client other than FMR is Fidelity International Limited (FIL), an
affiliate of FMR organized under the laws of Bermuda. FIL provides
investment advisory services to non-U.S. investment companies and
institutional investors investing in securities of issuers throughout
the world. Edward C. Johnson 3d, President and a Trustee of the trust,
is Chairman and a Director of FMR Far East, Chairman and a Director of
FIL, and a principal stockholder of both FIL and FMR. For more
information on FMR Far East, see the section entitled "Activities and
Management of FMR U.K., FMR Far East and FIJ" on page .
CONCLUSION. The Board of Trustees has concluded that the proposal
will benefit each fund and its shareholders. The Trustees recommend
voting FOR the proposal. With respect to each fund, if the Amended
Agreement is approved by shareholders, the Amended Agreement will take
effect on the first day of the first month following approval. If the
Amended Agreement is not approved by shareholders, the Present
Agreement with FMR Far East will remain in effect.
9. TO APPROVE A DISTRIBUTION AND SERVICE PLAN PURSUANT TO RULE 12B-1
FOR EACH OF FIDELITY CAPITAL APPRECIATION FUND AND FIDELITY
TECHNOQUANT GROWTH FUND.
The Board of Trustees has approved, and recommends that shareholders
of Fidelity Capital Appreciation Fund and Fidelity TechnoQuant Growth
Fund approve a Distribution and Service Plan (the Plan) for each fund.
A copy of the Plan is supplied as Exhibit 7 beginning on page .
THE PLAN. The Plan was approved by the Board as provided for by Rule
12b-1 (the Rule) promulgated by the SEC under the 1940 Act. The Rule
provides that, an investment company (e.g., a mutual fund) acting as a
distributor of its shares must do so pursuant to a written Plan
"describing all material aspects of the proposed financing of
distribution.'' Under the Rule, an investment company is deemed to be
acting as a distributor of its shares if it engages "directly or
indirectly in financing any activity which is primarily intended to
result in the sale of shares issued by such company, including, but
not necessarily limited to, advertising, compensation of underwriters,
dealers, and sales personnel, the printing and mailing of prospectuses
to other than current shareholders, and the printing and mailing of
sales literature.''
The Plan is designed to avoid legal uncertainties which may arise
from the ambiguity of the phrase "primarily intended to result in the
sale of shares'' and from the term "indirectly'' as used in the Rule.
The SEC has neither approved nor disapproved the Plan.
The Plan contemplates that all expenses relating to the distribution
of fund shares shall be paid for by FMR, or Fidelity Distributors
Corporation (FDC), a wholly owned subsidiary of FMR Corp., out of past
profits and other resources, including management fees paid by a fund
to FMR. The Plan also recognizes that FMR, either directly or through
FDC, may make payments from these sources to securities dealers and to
other third parties who engage in the sale of fund shares or who
render shareholder services. The Plan provides that, to the extent
that the fund's payment of management fees to FMR might be considered
to constitute the "indirect'' financing of activities "primarily
intended to result in the sale of shares,'' such payment is expressly
authorized. THE PLAN DOES NOT AUTHORIZE PAYMENTS BY THE FUND OTHER
THAN THOSE THAT ARE TO BE MADE TO FMR UNDER ITS MANAGEMENT CONTRACT.
Each fund may execute portfolio transactions with, and purchase
securities issued by, depository institutions that receive payments
under the Plan. No preference for the instruments of such depository
institutions will be shown in the selection of investments.
Although the Plan contemplates that FMR and FDC may engage in various
distribution activities, it does not require them to perform any
specific type of distribution activity or to incur any specific level
of expense for such activities.
The Plan contains a number of provisions relating to reporting
obligations and to its amendment and termination as required by the
Rule. If approved by shareholders, the Plan will continue in effect as
long as its continuance is specifically approved at least annually by
a majority of the Board of Trustees, including a majority of the
Trustees who are not "interested persons'' of the trust and who have
no direct or indirect financial interest in the operation of the Plan
or any agreement related to the Plan (the non-interested Trustees),
cast in person at a meeting called for the purpose of voting on the
Plan. The Plan may be amended at any time by the Trustees, except that
it may not be amended to authorize direct payments by the fund to
finance any activity primarily intended to result in the sale of
shares issued by the fund or to increase materially the amount spent
by the fund for distribution without the approval of a majority of the
outstanding shares of the fund and the Trustees. All material
amendments to the Plan must be approved by a majority of the
non-interested Trustees. The Plan, and any agreements related to the
Plan, may be terminated at any time by a vote of a majority of the
non-interested Trustees or by a vote of a majority of the outstanding
shares of the fund. The Plan requires that the Trustees receive, at
least quarterly, a written report as to the amounts expended during
the quarter by FMR, or FDC, in connection with financing any activity
primarily intended to result in the sale of shares issued by the fund,
and the purposes for which such expenditures were made. As required by
the Rule, while the Plan is in effect, the selection and nomination of
those Trustees who are not "interested persons" shall be committed to
the discretion of the non-interested Trustees then in office.
TRUSTEE CONSIDERATION. In determining to recommend the adoption of
each Plan, the Board considered a variety of factors and was advised
by counsel who are not counsel to FMR or FDC. The Trustees believe
that the fees paid by the fund to FMR under the Management Contract,
are fair and reasonable, that the services provided thereunder are
necessary and appropriate for the fund and its shareholders, and that
the fund does not indirectly finance the distribution of its shares in
contravention of the Rule. Nonetheless, the Trustees concluded that
adoption of each Plan would avoid legal uncertainties which might
arise as a result of what they and FMR believe to be potentially
subjective and ambiguous language contained in the Rule and in public
releases issued by the SEC in connection with the proposal and
adoption of the Rule (SEC Releases). The Trustees believe that the
adoption of each Plan is advisable to minimize such legal
uncertainties and to provide other benefits to each fund and its
shareholders.
The Trustees noted that each fund's Plan does not involve any direct
payment by the fund to finance any activity primarily intended to
result in the sale of shares issued by the fund, and that any
amendment of the fund's Management Contract with FMR to increase the
amount paid by the fund thereunder would require approval of both the
Trustees and the fund's shareholders. The Trustees also considered the
factors suggested in the SEC Releases including: the need for
independent counsel or experts to assist the Trustees in reaching a
determination; the nature and causes of the problems and circumstances
which made consideration of a Plan appropriate; the way in which a
Plan would resolve or alleviate the problems, including the nature and
approximate amount of the expenditures contemplated by the Plan; the
merits of possible alternatives to the Plan; the interrelationship
between the Plan and the activities of FMR in financing the
distribution of the fund's shares; the possible benefits of the Plan
to FMR and its affiliates relative to those expected to accrue to the
fund; and consequently the effects of the Plan on existing
shareholders.
The reduction in legal uncertainties arising from the potentially
subjective and ambiguous language that appears in the Rule and in the
SEC Releases enables the Trustees, in connection with their review of
the fund's Management Contract with FMR, to consider the full range of
services provided by FMR and FDC, including services which may be
related to the distribution of the fund's shares. In addition, the
Board of Trustees considered alternatives to the Plan, including
direct payments by a fund to FDC and/or third parties and the
implementation of a sales load. The Trustees believe it is appropriate
to ensure that FMR and FDC have the flexibility to direct their
distribution activities in a manner consistent with prevailing market
conditions by using, subject to approval of the Trustees, their
resources, including the current management fee, to make payments to
third parties. To the extent that FMR has greater flexibility under
each Plan, additional sales of the fund's shares may result. The
Trustees believe that this flexibility has the potential to benefit
the fund by reducing the possibility that the fund would experience
net redemptions, which might require the liquidation of portfolio
securities in amounts and at times that could be disadvantageous for
investment purposes. Of course, there can be no assurance that these
events will occur.
The Board of Trustees recognized that a greater level of fund assets
benefits FMR by increasing its management fee revenues. The Board
noted the high quality of investment management services and the
expansion of, and many innovations in, investor services that have
been provided by FMR over the years. The Board believes that revenues
received by FMR contribute to its continuing ability to attract and
retain a high caliber of investment and other personnel and to develop
and implement new systems for providing services and information to
shareholders. The Board considers this ability to be an important
benefit to the fund and its shareholders.
CONCLUSION. For the reasons stated above, the members of the Board of
Trustees concluded in the exercise of their business judgment and in
light of their fiduciary duties under state law and the 1940 Act that
there is a reasonable likelihood that the Plan will benefit each fund
and its shareholders. The Trustees recommend that shareholders of each
fund vote FOR approval of the Plan. With respect to each fund, if the
Plan is not approved, the Board and FMR will consider alternative
means of obtaining the services that are to be provided under the
Plan.
10. TO ELIMINATE CERTAIN FUNDAMENTAL INVESTMENT POLICIES OF FIDELITY
CAPITAL APPRECIATION FUND.
The Board of Trustees has approved, and recommends that shareholders
of the fund approve, elimination of certain fundamental investment
policies. Elimination of these policies will allow the fund to more
clearly communicate its investment objective and strategies by
standardizing its investment disclosure in a manner consistent with
other Fidelity funds with similar investment disciplines. Elimination
of these policies is not expected to materially affect the way the
fund is managed.
DISCUSSION OF PROPOSED MODIFICATIONS. The fund's fundamental
investment objective and certain fundamental investment policies
currently read as follows:
"Capital Appreciation Fund seeks capital appreciation. FMR will seek
capital appreciation primarily by purchasing common stocks, although
FMR may seek capital appreciation by purchasing other types of
securities, including bonds and preferred stocks. The emphasis placed
on a particular type of security will depend on FMR's interpretation
of underlying economic, financial, and security trends. The fund does
not place any emphasis on dividend or interest income, except when FMR
believes this income will have a favorable influence on the market
value of a security. It is the fund's policy to invest in the
securities of both well-known and established companies and smaller,
less well-known companies. The fund will also seek investment
opportunities in companies involved in prospective acquisitions,
reorganizations, spinoffs, consolidations, and liquidations."
If the proposal is approved, the fund's fundamental investment
objective would remain unchanged but the fundamental investment
policies would be eliminated as follows (deleted language is
[bracketed]):
"Capital Appreciation Fund seeks capital appreciation. [FMR will seek
capital appreciation primarily by purchasing common stocks, although
FMR may seek capital appreciation by purchasing other types of
securities, including bonds and preferred stocks. The emphasis placed
on a particular type of security will depend on FMR's interpretation
of underlying economic, financial, and security trends. The fund does
not place any emphasis on dividend or interest income, except when FMR
believes this income will have a favorable influence on the market
value of a security. It is the fund's policy to invest in the
securities of both well-known and established companies and smaller,
less well-known companies. The fund will also seek investment
opportunities in companies involved in prospective acquisitions,
reorganizations, spinoffs, consolidations, and liquidations.]"
Because the foregoing investment policies are fundamental, they
cannot be modified or eliminated without shareholder approval.
DISCUSSION OF PROPOSED MODIFICATIONS. Eliminating the foregoing
fundamental policies will allow the fund to more clearly communicate
its investment objective and strategies to shareholders by
standardizing its investment disclosure in a manner consistent with
other Fidelity funds with similar investment disciplines. If the
proposal is approved, the fund will continue to rely on its
non-fundamental policy of investing primarily in common stocks. As
noted above, fundamental policies can be changed or eliminated only
with shareholder approval, while non-fundamental policies can be
changed or eliminated without shareholder approval. Changes in
non-fundamental policies, however, are still subject to the
supervision of the Board of Trustees. Eliminating the fundamental
investment policies as proposed is not expected to materially affect
the way the fund is managed.
CONCLUSION. The Board of Trustees has concluded that eliminating the
foregoing fundamental investment policies is in the best interest of
the fund and its shareholders. The Trustees recommend voting FOR the
proposal. If approved by shareholders, the changes will become
effective when disclosure is revised to reflect them. If the proposal
is not approved by the fund's shareholders, the fund's current
fundamental investment policies will remain unchanged.
11. TO ELIMINATE A FUNDAMENTAL INVESTMENT POLICY OF FIDELITY
DISCIPLINED EQUITY FUND.
The Board of Trustees has approved, and recommends that shareholders
of the fund approve, the elimination of a fundamental investment
policy of the fund. Elimination of this policy will allow the fund to
more clearly communicate its investment objective and strategies by
standardizing its investment disclosure in a manner consistent with
other Fidelity funds with similar investment disciplines. Elimination
of this investment policy is not expected to materially affect the way
the fund is managed.
The fund's fundamental investment objective and a fundamental
investment policy currently read as follows:
"Disciplined Equity seeks capital growth by investing primarily in a
broadly diversified portfolio of common stocks."
If the proposal is approved, the fund's fundamental investment
objective would remain unchanged but the fundamental investment policy
would be eliminated as follows (deleted language is [bracketed]):
"Disciplined Equity seeks capital growth [by investing primarily in a
broadly diversified portfolio of common stocks]."
Because the foregoing investment policy is fundamental, it cannot be
modified or eliminated without shareholder approval.
DISCUSSION OF PROPOSED MODIFICATIONS. Eliminating the foregoing
fundamental policy will allow the fund to more clearly communicate its
investment objective and strategies to shareholders by standardizing
its investment disclosure in a manner consistent with other Fidelity
funds with similar investment disciplines. If the proposal is
approved, the fund will continue to rely on its existing fundamental
policy regarding diversification and its existing non-fundamental
policy of investing at least 65% of its total assets in common stocks.
Pursuant to current fundamental policy, the fund is "diversified" as
defined in the Investment Company Act of 1940, which means that with
respect to at least 75% of its total assets (a) no more than 5% of its
total assets are invested in the securities of a single issuer; and
(b) the fund owns no more than 10% of the outstanding voting
securities of such issuer. As noted above, fundamental policies can be
changed or eliminated only with shareholder approval, while
non-fundamental policies can be changed or eliminated without
shareholder approval. Changes in non-fundamental policies, however,
are still subject to the supervision of the Board of Trustees.
Eliminating the fundamental investment policy as proposed is not
expected to materially affect the way the fund is managed.
CONCLUSION. The Board of Trustees has concluded that eliminating the
foregoing fundamental investment policy is in the best interest of the
fund and its shareholders. The Trustees recommend voting FOR the
proposal. If approved by shareholders, the change will become
effective when disclosure is revised to reflect it. If the proposal is
not approved by the fund's shareholders, the fund's current
fundamental investment policies will remain unchanged.
12. TO ELIMINATE A FUNDAMENTAL INVESTMENT POLICY OF FIDELITY STOCK
SELECTOR.
The Board of Trustees has approved, and recommends that shareholders
of the fund approve, the elimination of a fundamental investment
policy of the fund. Elimination of this policy will allow the fund to
more clearly communicate its investment objective and strategies by
standardizing its investment disclosure in a manner consistent with
other Fidelity funds with similar investment disciplines. Elimination
of this policy is not expected to materially affect the way the fund
is managed.
The fund's fundamental investment objective and a fundamental
investment policy currently read as follows:
"Stock Selector seeks capital growth by investing primarily in common
stocks."
If the proposal is approved, the fund's fundamental investment
objective would remain unchanged but the fundamental investment policy
would be eliminated as follows (deleted language is [bracketed]):
"Stock Selector seeks capital growth [by investing primarily in
common stocks]."
Because the foregoing investment policy is fundamental, it cannot be
modified or eliminated without shareholder approval.
DISCUSSION OF PROPOSED MODIFICATIONS. Eliminating the foregoing
fundamental policy will allow the fund to more clearly communicate its
investment objective and strategies to shareholders by standardizing
its investment disclosure in a manner consistent with other Fidelity
funds with similar investment disciplines. If the proposal is
approved, the fund will continue to rely on its existing
non-fundamental policy of investing at least 65% of its total assets
in common stocks. As noted above, fundamental policies can be changed
or eliminated only with shareholder approval, while non-fundamental
policies can be changed or eliminated without shareholder approval.
Changes in non-fundamental policies, however, are still subject to the
supervision of the Board of Trustees.
Eliminating the fundamental investment policy as proposed is not
expected to materially affect the way the fund is managed.
CONCLUSION. The Board of Trustees has concluded that eliminating the
foregoing fundamental investment policy is in the best interest of the
fund and its shareholders. The Trustees recommend voting FOR the
proposal. If approved by shareholders, the change will become
effective when disclosure is revised to reflect it. If the proposal is
not approved by the fund's shareholders, the fund's current
fundamental investment policies will remain unchanged.
ADOPTION OF STANDARDIZED INVESTMENT LIMITATIONS
The primary purpose of Proposals 13 through 15 is to revise several
of the funds' investment limitations to conform to limitations which
are standard for similar types of funds managed by FMR. The Board of
Trustees asked FMR to analyze the various fundamental and
non-fundamental investment limitations of the Fidelity funds, and,
where practical and appropriate to a fund's investment objective and
policies, propose to shareholders adoption of standard fundamental
limitations and elimination of certain other fundamental limitations.
Generally, when fundamental limitations are eliminated, Fidelity's
standard non-fundamental limitations replace them. By making these
limitations non-fundamental, the Board of Trustees may amend a
limitation as they deem appropriate, without seeking shareholder
approval. The Board of Trustees would amend the limitations to
respond, for instance, to developments in the marketplace, or changes
in federal or state law. The costs of shareholder meetings called for
these purposes are generally borne by a fund and its shareholders.
It is not anticipated that these proposals will substantially affect
the way a fund is currently managed. However, FMR is presenting them
to you for your approval because FMR believes that increased
standardization will help to promote operational efficiencies and
facilitate monitoring of compliance with fundamental and
non-fundamental investment limitations. Although adoption of a new or
revised limitation is not likely to have any impact on the current
investment techniques employed by a fund, it will contribute to the
overall objectives of standardization.
13. TO AMEND THE FUNDAMENTAL INVESTMENT LIMITATION CONCERNING
DIVERSIFICATION TO EXCLUDE SECURITIES OF OTHER INVESTMENT
COMPANIES FROM THE LIMITATION FOR EACH OF FIDELITY CAPITAL
APPRECIATION FUND, FIDELITY DISCIPLINED EQUITY FUND,
FIDELITY STOCK SELECTOR AND FIDELITY VALUE FUND.
Each fund's current fundamental investment limitation concerning
diversification is as follows:
"The fund may not, with respect to 75% of the fund's total assets,
purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities) if, as a result, (a) more than 5% of the fund's
total assets would be invested in the securities of that issuer, or
(b) the fund would hold more than 10% of the outstanding voting
securities of that issuer."
The Trustees recommend that shareholders of each fund vote to replace
each fund's current fundamental investment limitation with the
following amended fundamental investment limitation governing
diversification (additional language is underlined and deleted
language is [bracketed]):
"The fund may not with respect to 75% of the fund's total assets,
purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. [g]Government or any of its agencies or
instrumentalities((, or securities of other investment companies)))
if, as a result, (a) more than 5% of the fund's total assets would be
invested in the securities of that issuer, or (b) the fund would hold
more than 10% of the outstanding voting securities of that issuer."
The percentage limits in the proposed fundamental limitation
concerning diversification are imposed by the 1940 Act. The amended
fundamental diversification limitation makes one change from the
current limitation: subject to applicable 1940 Act requirements, it
would permit each fund to invest without limit in the securities of
other investment companies. Pursuant to an order of exemption granted
by the SEC, each fund may invest in short-term bond or money market
funds managed by FMR or an affiliate of FMR (the Investment Funds).
The Investment Funds currently do not bear the cost of investment
advisory, management, or transfer agent fees, although they may do so
subject to the conditions of the SEC order, including Board review of
the total fees paid by shareholders of the fund. The Investment Funds
currently pay minimal fees for services such as custodian, auditor,
certain pricing and bookkeeping services, and Independent Trustees
fees. FMR anticipates that investing in the Investment Funds will
benefit each fund by enhancing the efficiency of the investment of
cash generated by fund shareholder or investment activity, or through
the investment of fund assets allocated to the short-term bond or
money markets in support of the funds' investment objectives. For some
funds, the Investment Funds may serve as the principal option for cash
investment. If the proposal is approved, future amendments to the
funds' fundamental diversification limitation would continue to
require shareholder approval.
If this proposal is approved, the amended fundamental diversification
limitation cannot be changed without the approval of shareholders.
CONCLUSION. The Board of Trustees has concluded that the proposed
amendment will benefit each fund and its shareholders. The Trustees
recommend voting FOR the proposal. The amended fundamental
diversification limitation, upon shareholder approval, will become
effective when the disclosure is revised to reflect the changes. If
the proposal is not approved by the shareholders of a fund, that
fund's current fundamental diversification limitation will remain
unchanged.
14. TO AMEND FIDELITY CAPITAL APPRECIATION FUND'S FUNDAMENTAL
INVESTMENT LIMITATION CONCERNING CONCENTRATION.
The fund's current fundamental investment limitation concerning the
concentration of its investments within a single industry states:
"The fund may not purchase any security if, as a result, more than
25% of its total assets would be invested in the securities of
companies having their principal business activities in the same
industry (this limitation does not apply to securities issued or
guaranteed by the United States government or its agencies or
instrumentalities)."
The Trustees recommend that shareholders of the fund vote to replace
this fundamental investment limitation with the following amended
fundamental investment limitation governing concentration:
"The fund may not purchase the securities of any issuer (other than
securities issued or guaranteed by the U.S. Government or any of its
agencies or instrumentalities) if, as a result, more than 25% of the
fund's total assets would be invested in the securities of companies
whose principal business activities are in the same industry."
The primary purpose of the proposal is to revise the fund's
fundamental concentration limitation to conform to a limitation which
is expected to become standard for all funds managed by FMR. (See
"Adoption of Standardized Investment Limitations" on page .) If the
proposal is approved, future amendments to the fund's fundamental
concentration limitation would continue to require shareholder
approval.
The proposed amended limitation is not substantially different from
the current limitation, and adoption of the proposed amended
limitation is not expected to affect the way the fund is managed.
CONCLUSION. The Board of Trustees has concluded that the proposal
will benefit the fund and its shareholders. The Trustees recommend
voting FOR the proposal. Upon shareholder approval, the amended
fundamental limitation will become effective when disclosure is
revised to reflect the changes. If the proposal is not approved by the
shareholders of the fund, the fund's current limitation will remain
unchanged.
15. TO AMEND FIDELITY VALUE FUND'S FUNDAMENTAL INVESTMENT LIMITATION
CONCERNING UNDERWRITING.
The fund's current fundamental investment limitation concerning
underwriting states:
"The fund may not underwrite any issue of securities, except to the
extent that the fund may be deemed to be an underwriter within the
meaning of the Securities Act of 1933 in the disposition of restricted
securities."
The trustees recommend that shareholders of the fund vote to replace
this limitation with the following fundamental limitation governing
underwriting:
"The fund may not underwrite securities issued by others, except to
the extent that the fund may be considered an underwriter within the
meaning of the Securities Act of 1933 in the disposition of restricted
securities."
The primary purpose of the proposed amendment is to conform the
fund's fundamental investment limitation concerning underwriting to a
limitation which is expected to become standard for all funds managed
by FMR. (See "Adoption of Standardized Investment Limitations" on page
.) If the proposal is approved, the new limitation may not be changed
without the approval of shareholders.
Adoption of the proposed limitation concerning underwriting is not
expected to affect the way in which the fund is managed, the
investment performance of the fund, or the securities or instruments
in which the fund invests.
CONCLUSION. The Board of Trustees has concluded that the proposal
will benefit the fund and its shareholders. The Trustees recommend
voting FOR the proposal. Upon shareholder approval, the amended
fundamental limitation will become effective when disclosure is
revised to reflect the changes. If the proposal is not approved by the
shareholders of the fund, the fund's current limitation will remain
unchanged.
OTHER BUSINESS
The Board knows of no other business to be brought before the
Meeting. However, if any other matters properly come before the
Meeting, it is the intention that proxies that do not contain specific
instructions to the contrary will be voted on such matters in
accordance with the judgment of the persons therein designated.
ACTIVITIES AND MANAGEMENT OF FMR
FMR, a corporation organized in 1946, serves as investment adviser to
a number of investment companies. Information concerning the advisory
fees and average net assets of funds with investment objectives
similar to Fidelity Capital Appreciation Fund, Fidelity Disciplined
Equity Fund, Fidelity Small Cap Selector, Fidelity Stock Selector,
Fidelity TechnoQuant Growth Fund and Fidelity Value Fund and advised
by FMR is contained in the Table of Average Net Assets and Expense
Ratios in Exhibit 8 beginning on page .
FMR, its officers and directors, its affiliated companies, and the
Trustees, from time to time have transactions with various banks,
including the custodian banks for certain of the funds advised by FMR.
Those transactions that have occurred to date have included mortgages
and personal and general business loans. In the judgment of FMR, the
terms and conditions of those transactions were not influenced by
existing or potential custodial or other fund relationships.
The Directors of FMR are Edward C. Johnson 3d, Chairman of the Board
and of the Executive Committee; Robert C. Pozen, President; Peter S.
Lynch, Vice Chairman; and Abigail P. Johnson, Senior Vice President.
Each of the Directors is also a Trustee of the trust, except Ms.
Johnson. Messrs. Johnson 3d, Pozen, John H. Costello, Matthew N.
Karstetter, Eric D. Roiter, Richard A. Silver, Robert A. Lawrence, Ms.
Abigail Johnson, Richard A. Spillane Jr., Harry W. Lange, Bradford
Lewis and Richard B. Fentin are currently officers of the trust and
officers or employees of FMR or FMR Corp. With the exception of Mr.
Karstetter, all of these persons hold or have options to acquire stock
of FMR Corp. The principal business address of each of the Directors
of FMR is 82 Devonshire Street, Boston, Massachusetts 02109.
All of the stock of FMR is owned by its parent company, FMR Corp., 82
Devonshire Street, Boston, Massachusetts 02109, which was organized on
October 31, 1972. Members of Mr. Edward C. Johnson 3d and Ms. Abigail
P. Johnson's family are the predominant owners of a class of shares of
common stock, representing approximately 49% of the voting power of
FMR Corp., and, therefore, under the 1940 Act may be deemed to form a
controlling group with respect to FMR Corp.
During the period November 1, 1998 through September 30, 1999, no
transactions were entered into by Trustees and nominees as Trustee of
the trust involving more than 1% of the voting common, non-voting
common and equivalent stock, or preferred stock of FMR Corp.
ACTIVITIES AND MANAGEMENT OF FMR U.K., FMR FAR EAST AND FIJ
FMR U.K. and FMR Far East are wholly-owned subsidiaries of FMR formed
in 1986 to provide research and investment advice with respect to
companies based outside the United States for certain funds for which
FMR acts as investment adviser. FMR may grant FMR U.K. and FMR Far
East investment management authority as well as authority to buy and
sell securities for certain of the funds for which it acts as
investment adviser, if FMR believes it would be beneficial to a fund.
FIJ is a wholly owned subsidiary of Fidelity International Limited,
organized in Japan in 1986 to provide research and investment
recommendations with respect to companies primarily based in Japan and
other parts of Asia.
Funds with investment objectives similar to Fidelity Capital
Appreciation Fund, Fidelity Disciplined Equity Fund, Fidelity Small
Cap Selector, Fidelity Stock Selector, Fidelity TechnoQuant Growth
Fund, and Fidelity Value Fund managed by FMR with respect to which FMR
currently has sub-advisory agreements with either FMR U.K. or FMR Far
East, and the net assets of each of these funds, are indicated in the
Table of Average Net Assets and Expense Ratios in Exhibit 8 beginning
on page .
The Directors of FMR U.K. and FMR Far East are Edward C. Johnson 3d,
Chairman, and Robert C. Pozen, President. Mr. Johnson 3d also is
President and a Trustee of the trust and other funds advised by FMR;
Chairman and a Director of Fidelity Investments Money Management, Inc.
(FIMM); Chairman, Chief Executive Officer, President, and a Director
of FMR Corp., and a Director and Chairman of the Board and of the
Executive Committee of FMR. In addition, Mr. Pozen is Senior Vice
President and a Trustee of the trust and of other funds advised by
FMR; President and a Director of FMR; and President and a Director of
FIMM. Each of the Directors is a stock holder of FMR Corp. The
principal business address of the Directors is 82 Devonshire Street,
Boston, Massachusetts 02109.
The Directors of FIJ are Billy Wilder, President, Simon Haslam,
Edward C. Johnson 3d, Noboru Kawai, Yasuo Kuramoto, Tetsuzo Nishimura,
Takeshi Okazaki, and Hiroshi Yamashita. With the exception of Mr.
Edward C. Johnson 3d, the principal business address of each of the
Directors is Shiroyama JT Mori Building, 4-3-1 Toranomon, Minato-ku,
Tokyo 105, Japan. The principal business address of Mr. Edward C.
Johnson 3d is 82 Devonshire Street, Boston, Massachusetts 02109.
PRESENT MANAGEMENT CONTRACTS
Each fund employs FMR to furnish investment advisory and other
services. Under its management contract with each fund, FMR acts as
investment adviser and, subject to the supervision of the Board of
Trustees, directs the investments of each fund in accordance with its
investment objective, policies, and limitations. FMR also provides
each fund with all necessary office facilities and personnel for
servicing each fund's investments, compensates all officers of each
fund and all Trustees who are "interested persons" of the trust or of
FMR, and all personnel of each fund or FMR performing services
relating to research, statistical, and investment activities.
In addition, FMR or its affiliates, subject to the supervision of the
Board of Trustees, provide the management and administrative services
necessary for the operation of each fund. These services include
providing facilities for maintaining each fund's organization;
supervising relations with custodians, transfer and pricing agents,
accountants, underwriters, and other persons dealing with each fund;
preparing all general shareholder communications and conducting
shareholder relations; maintaining each fund's records and the
registration of each fund's shares under federal and state laws;
developing management and shareholder services for each fund; and
furnishing reports, evaluations, and analyses on a variety of subjects
to the Trustees. Services provided by affiliates of FMR will continue
under the proposed management contracts described in proposals 4, 5,
and 6.
In addition to the management fee payable to FMR, each fund pays
transfer agent and pricing and bookkeeping fees to Fidelity Service
Company, Inc. (FSC), an affiliate of FMR, its transfer, dividend
disbursing, and shareholder servicing agent. Although each fund's
current management contract provides that each fund will pay for
typesetting, printing, and mailing prospectuses, statements of
additional information, notices, and reports to shareholders, the
trust, on behalf of each fund has entered into a revised transfer
agent agreement with FSC, pursuant to which FSC bears the costs of
providing these services to existing shareholders. Other expenses paid
by each fund include interest, taxes, brokerage commissions, and each
fund's proportionate share of insurance premiums and Investment
Company Institute dues. Each fund is also liable for such
non-recurring expenses as may arise, including costs of any litigation
to which each fund may be a party, and any obligation it may have to
indemnify its officers and Trustees with respect to litigation.
Transfer agent fees and pricing and bookkeeping fees, including
reimbursement for out-of-pocket expenses, paid to FSC by Fidelity
Capital Appreciation Fund, Fidelity Disciplined Equity Fund, Fidelity
Small Cap Selector, Fidelity Stock Selector, Fidelity TechnoQuant
Growth Fund and Fidelity Value Fund for fiscal 1999 amounted to the
following:
Fund Name Fees Paid to FSC
Capital Appreciation Fund $ 6,351,000
Disciplined Equity Fund $ 7,070,000
Small Cap Selector $ 1,128,015
Stock Selector $ 3,927,000
TechnoQuant Growth Fund $ 227,255
Value Fund $ 12,277,000
FSC also received fees for administering each fund's securities
lending program. Securities lending costs are based on the number and
duration of individual securities loans. For fiscal 1999, Fidelity
Capital Appreciation Fund paid FSC $17,000 for securities lending.
Each fund also has a distribution agreement with FDC, a Massachusetts
corporation organized on July 18, 1960. FDC is a broker-dealer
registered under the Securities Exchange Act of 1934 and is a member
of the National Association of Securities Dealers, Inc. Each
distribution agreement calls for FDC to use all reasonable efforts,
consistent with its other business, to secure purchasers for shares of
the fund, which are continuously offered for Fidelity Capital
Appreciation Fund, Fidelity Disciplined Equity Fund, Fidelity Small
Cap Selector, Fidelity Stock Selector, Fidelity TechnoQuant Growth
Fund and Fidelity Value Fund. Promotional and administrative expenses
in connection with the offer and sale of shares are paid by FMR.
Sales charge revenue paid to, and retained by, FDC for fiscal 1999
amounted to $255,000 and $20,638 for Fidelity Capital Appreciation
Fund and Fidelity TechnoQuant Growth Fund, respectively.
FMR is the manager of Fidelity Capital Appreciation Fund, Fidelity
Disciplined Equity Fund, Fidelity Stock Selector and Fidelity Value
Fund pursuant to management contracts dated November 1, 1994, which
were approved by shareholders on October 26, 1994. FMR is the manager
of Fidelity Small Cap Selector pursuant to a management contract dated
October 1, 1999, which was approved by shareholders on September 15,
1999. The management contracts were submitted to shareholders in
connection with proposals to provide for lower fees when FMR's assets
under management exceed certain levels and to provide for a reduction
in individual fund fee rate for Fidelity Value Fund.
FMR is the manager of Fidelity TechnoQuant Growth Fund pursuant to a
management contract dated October 17, 1996, which was approved by FMR,
as the then sole shareholder of the fund prior to commencement of
operations.
For the services of FMR under the management contract, each fund pays
FMR a monthly management fee which has two components: a basic fee,
which is the sum of a group fee rate and an individual fund fee rate,
and a performance adjustment based on a comparison of Fidelity Capital
Appreciation's, Fidelity Disciplined Equity's, Fidelity Stock
Selector's, Fidelity TechnoQuant Growth's and Fidelity Value Fund's
performance to that of the Standard & Poor's 500 Index (S&P 500) and
Fidelity Small Cap Selector's performance to that of the Russell 2000
Index.
The group fee rate is based on the monthly average net assets of all
of the registered investment companies with which FMR has management
contracts and is calculated on a cumulative basis pursuant to the
graduated fee rate schedule shown below on the left. The schedule
below on the right shows the effective annual group fee rate at
various asset levels, which is the result of cumulatively applying the
annualized rates on the left. For example, the effective annual fee
rate at $800 billion of group net assets - the approximate level for
November 30, 1999 - was 0.2781%, which is the weighted average of the
respective fee rates for each level of group net assets up to $800
billion.
On January 1, 1996 and August 1, 1999, FMR voluntarily modified the
breakpoints in the group fee rate schedule. The revised group fee rate
schedule, depicted below, provides for lower management fee rates as
FMR's assets under management increase.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES
Average Group Assets Annualized Rate Group Net Assets Effective Annual Fee Rate
0 - $3 billion .5200% $ 1 billion .5200%
3 - 6 .4900 50 .3823
6 - 9 .4600 100 .3512
9 - 12 .4300 150 .3371
12 - 15 .4000 200 .3284
15 - 18 .3850 250 .3219
18 - 21 .3700 300 .3163
21 - 24 .3600 350 .3113
24 - 30 .3500 400 .3067
30 - 36 .3450 450 .3024
36 - 42 .3400 500 .2982
42 - 48 .3350 550 .2942
48 - 66 .3250 600 .2904
66 - 84 .3200 650 .2870
84 - 102 .3150 700 .2838
102 - 138 .3100 750 .2809
138 - 174 .3050 800 .2782
174 - 210 .3000 850 .2756
210 - 246 .2950 900 .2732
246 - 282 .2900 950 .2710
282 - 318 .2850 1,000 .2689
318 - 354 .2800 1,050 .2669
354 - 390 .2750 1,100 .2649
390 - 426 .2700 1,150 .2631
426 - 462 .2650 1,200 .2614
462 - 498 .2600 1,250 .2597
498 - 534 .2550 1,300 .2581
534 - 587 .2500 1,350 .2566
587 - 646 .2463 1,400 .2551
646 - 711 .2426
711 - 782 .2389
782 - 860 .2352
860 - 946 .2315
946 - 1,041 .2278
1,041 - 1,145 .2241
1,145 - 1,260 .2204
Over 1,260 .2167
</TABLE>
The individual fund fee rate for Fidelity Capital Appreciation Fund,
Fidelity Disciplined Equity Fund, Fidelity Stock Selector, Fidelity
TechnoQuant Growth Fund and Fidelity Value Fund is 0.30%. The
individual fund fee rate for Fidelity Small Cap Selector is 0.35%.
Based on the average group net assets of the funds advised by FMR for
November 30, 1999, each fund's annual basic fee rate would be
calculated as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Group Fee Rate Individual Fund Fee Rate Basic Fee Rate
Capital Appreciation 0.2781% + 0.30% = 0.5781%
Disciplined Equity 0.2781% + 0.30% = 0.5781%
Small Cap Selector 0.2781% + 0.35% = 0.6281%
Stock Selector 0.2781% + 0.30% = 0.5781%
TechnoQuant Growth 0.2781% + 0.30% = 0.5781%
Value 0.2781% + 0.30% = 0.5781%
</TABLE>
One-twelfth of this annual basic fee rate is applied to each fund's
net assets averaged for the most recent month, giving a dollar amount,
which is the fee for that month.
COMPUTING THE PERFORMANCE ADJUSTMENT. The basic fee for Fidelity
Capital Appreciation Fund, Fidelity Disciplined Equity Fund, Fidelity
Stock Selector, Fidelity TechnoQuant Growth Fund and Fidelity Value
Fund is subject to upward or downward adjustment, depending upon
whether, and to what extent, the fund's investment performance for the
performance period exceeds, or is exceeded by, the record of the S&P
500 (the Index) over the same period. The basic fee for Fidelity Small
Cap Selector is subject to upward or downward adjustment, depending
upon whether, and to what extent, the fund's investment performance
for the performance period exceeds, or is exceeded by, the record of
the Russell 2000 (the Index) over the same period. Fidelity
TechnoQuant Growth Fund's performance period commenced on November 12,
1996. Starting with the twelfth month, the performance adjustment
takes effect. Each month subsequent to the twelfth month, a new month
is added to the performance period until the performance period
includes 36 months. Thereafter, the performance period consists of the
most recent month plus the previous 35 months. For Fidelity Small Cap
Selector and Fidelity TechnoQuant Growth Fund, each percentage point
of difference, calculated to the nearest 0.01% (up to a maximum
difference of +/-10.00 ) is multiplied by a performance adjustment
rate of 0.02%. For Fidelity Capital Appreciation Fund, Fidelity
Disciplined Equity Fund, Fidelity Stock Selector and Fidelity Value
Fund, each percentage point of difference, calculated to the nearest
1.00% (up to a maximum of +/-10.00) is multiplied by a performance
adjustment rate of 0.02%. Thus, the maximum annualized adjustment rate
is +/-0.20. This performance comparison is made at the end of each
month. One twelfth (1/12) of this rate is then applied to each fund's
average net assets for the entire performance period, giving a dollar
amount which will be added to (or subtracted from) the basic fee.
Each fund's performance is calculated based on changes in net asset
value (NAV). For purposes of calculating the performance adjustment,
any dividends or capital gain distributions paid by each fund are
treated as if reinvested in fund shares at the NAV as of the record
date for payment. The record of the Index is based on change in value
and is adjusted for any cash distributions from the companies whose
securities compose the Index.
Because the adjustment to the basic fee is based on each fund's
performance compared to the investment record of the Index, the
controlling factor is not whether each fund's performance is up or
down per se, but whether it is up or down more or less than the record
of the Index. Moreover, the comparative investment performance of each
fund is based solely on the relevant performance period without regard
to the cumulative performance over a longer or shorter period of time.
During fiscal 1999, FMR received $11,712,000, $13,300,000,
$6,288,000, $167,897 and $17,064,000 for its services as investment
adviser to Fidelity Capital Appreciation Fund, Fidelity Disciplined
Equity Fund, Fidelity Stock Selector, Fidelity TechnoQuant Growth Fund
and Fidelity Value Fund, respectively. During the twelve month period
ended October 31, 1999, FMR received $2,908,725 for its services as
investment adviser to Fidelity Small Cap Selector. These fees, which
include both the basic fee and the performance adjustment, were
equivalent to 0.4284%, 0.4197%, 0.4688%, 0.3751%, 0.3320%, and 0.3212%
of the average net assets of Fidelity Capital Appreciation Fund,
Fidelity Disciplined Equity Fund, Fidelity Small Cap Selector,
Fidelity Stock Selector, Fidelity TechnoQuant Growth Fund and Fidelity
Value Fund, respectively. For 1999, the downward performance
adjustments for Fidelity Capital Appreciation Fund, Fidelity
Disciplined Equity Fund, Fidelity Small Cap Selector, Fidelity Stock
Selector, Fidelity TechnoQuant Growth Fund and Fidelity Value Fund
amounted to ($4,220,000), ($5,161,000), ($1,029,739), ($3,488,000),
($127,031) and ($13,924,000), respectively.
FMR may, from time to time, agree to reimburse all or a portion of
each fund's total operating expenses (exclusive of interest, taxes,
brokerage commissions, and extraordinary expenses). FMR retains the
ability to be repaid for these expense reimbursements in the amount
that expenses fall below the limit prior to the end of the fiscal
year.
SUB-ADVISORY AGREEMENTS
On behalf of Fidelity Capital Appreciation Fund, Fidelity Disciplined
Equity Fund, Fidelity Small Cap Selector, Fidelity Stock Selector,
Fidelity TechnoQuant Growth Fund and Fidelity Value Fund, FMR has
entered into sub-advisory agreements with FMR U.K. and FMR Far East.
FMR Far East, in turn, has entered into a sub-advisory agreement with
FIJ, dated January 1, 2000. Pursuant to the sub-advisory agreements
with FMR U.K. and FMR Far East, FMR may receive investment advice and
research services outside the United States from FMR U.K. and FMR Far
East, respectively. On behalf of each fund, FMR may also grant FMR
U.K. and FMR Far East investment management authority as well as the
authority to buy and sell securities if FMR believes it would be
beneficial to the funds. Fidelity Capital Appreciation Fund's,
Fidelity Disciplined Equity Fund's, Fidelity Stock Selector's and
Fidelity Value Fund's sub-advisory agreements, dated November 1, 1994,
were approved by shareholders on October 26, 1994. Fidelity Small Cap
Selector's sub-advisory agreements, dated October 1, 1999, were
approved by shareholders on September 15, 1999. The sub-advisory
agreements (other than Fidelity Small Cap Selector's) were submitted
to shareholders to seek approval for FMR to grant FMR U.K. and FMR Far
East investment management authority as well as the authority to buy
and sell securities if FMR believes it will be beneficial to each fund
and its shareholders. Fidelity Small Cap Selector's sub-advisory
agreements were submitted to shareholders to seek approval for FMR,
FMR U.K. or FMR Far East and the trust, on behalf of the fund, to
modify the sub-advisory agreements subject to the requirements of the
1940 Act. Fidelity TechnoQuant Growth Fund's sub-advisory agreements,
dated October 17, 1996, were approved by FMR, as the then sole
shareholder of the fund, prior to commencement of operations.
Currently, FMR U.K. and FMR Far East each focus on issuers in
countries other than the United States such as those in Europe, Asia,
and the Pacific Basin.
FMR U.K. and FMR Far East, which were organized in 1986, are wholly
owned subsidiaries of FMR. FIJ, which was organized in 1986, is a
wholly owned subsidiary of Fidelity International Limited. Under the
sub-advisory agreements FMR pays the fees of FMR U.K. and FMR Far
East. For providing non-discretionary investment advice and research
services, FMR pays FMR U.K. and FMR Far East fees equal to 110% and
105%, respectively, of FMR U.K.'s and FMR Far East's costs incurred in
connection with providing investment advice and research services. FMR
Far East pays FIJ a fee equal to 100% of FIJ's costs incurred in
connection with providing investment advice and research services.
On behalf of Fidelity Capital Appreciation Fund, Fidelity Disciplined
Equity Fund, Fidelity Small Cap Selector, Fidelity Stock Selector,
Fidelity TechnoQuant Growth Fund and Fidelity Value Fund, for
providing discretionary investment management and executing portfolio
transactions, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of
its monthly management fee rate (including any performance adjustment)
with respect to each fund's average net assets managed by the
sub-adviser on a discretionary basis.
For providing investment advice and research services, on behalf of
each fund, the fees paid to the sub-advisers for the fiscal year ended
1999 were as follows:
FMR U.K. FMR Far East
Capital Appreciation Fund $ 233,336 $ 143,363
Disciplined Equity Fund $ 7,697 $ 5,578
Small Cap Selector* $ 4,282 $ 2,497
Stock Selector $ 46,144 $ 29,532
TechnoQuant Growth Fund $ 183 $ 101
Value Fund $ 82,700 $ 54,686
* Reflects fees paid for the 6 month fiscal period ended October 31,
1999.
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are
placed on behalf of each fund by FMR pursuant to authority contained
in the fund's management contract.
FMR may place agency transactions with National Financial Services
Corporation (NFSC) and Fidelity Brokerage Services (Japan), LLC
(FBSJ), indirect subsidiaries of FMR Corp., if the commissions are
fair, reasonable, and comparable to commissions charged by
non-affiliated, qualified brokerage firms for similar services.
The brokerage commissions paid to NFSC and FBS by each fund for
fiscal 1999 are listed in the following table:
<TABLE>
<CAPTION>
<S> <C> <C>
Brokerage Commissions Paid to Brokerage Commissions Paid to
NFSC FBS
Capital Appreciation Fund $ 210,000 $ 0
Disciplined Equity Fund $ 223,000 $ 0
Small Cap Selector* $ 25,000 $ 0
Stock Selector $ 125,000 $ 0
TechnoQuant Growth Fund $ 5,000 $ 0
Value Fund $ 572,000 $ 0
</TABLE>
* Reflects fees paid for the 6 month fiscal period ended October 31,
1999.
SUBMISSION OF CERTAIN SHAREHOLDER PROPOSALS
The trust does not hold annual shareholder meetings. Shareholders
wishing to submit proposals for inclusion in a proxy statement for a
subsequent shareholder meeting should send their written proposals to
the Secretary of the Trust, 82 Devonshire Street, Boston,
Massachusetts 02109.
NOTICE TO BANKS, BROKER-DEALERS AND
VOTING TRUSTEES AND THEIR NOMINEES
Please advise the trust, in care of Fidelity Service Company, Inc.,
P.O. Box 789, Boston, MA 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 and Annual Reports you wish to
receive in order to supply copies to the beneficial owners of the
respective shares.
EXHIBIT 1
The language to be added to the current Amended and Restated
Declaration of Trust is underlined, and the language to be deleted is
set forth in [brackets]. Headings that were underlined in the trust's
current Amended and Restated Declaration of Trust remain underlined in
this Exhibit.
FORM OF AMENDED AND RESTATED DECLARATION OF TRUST
((FIDELITY CAPITAL TRUST))
DATED [NOVEMBER 17, 1994]((_________________))
AMENDED AND RESTATED DECLARATION OF TRUST, made [November 17, 1994]
((, 2000)) by each of the Trustees whose signature is affixed hereto
(the "Trustees").
WHEREAS, the Trustees desire to amend and restate this Declaration of
Trust for the sole purpose of supplementing the Declaration ((of
Trust)) to incorporate amendments duly adopted; and
WHEREAS, this Trust was initially made on May 31, 1978 by Richard M.
Reilly and Caleb Loring, Jr. in order to establish a trust fund for
the investment and reinvestment of funds contributed thereto;
NOW, THEREFORE, the Trustees declare that all money and property
contributed to the trust fund hereunder shall be held and managed in
[T]trust under this Amended and Restated Declaration of Trust as
herein set forth below.
ARTICLE I
NAME AND DEFINITIONS
NAME
[Section 1] ((SECTION 1)). This Trust shall be known as "Fidelity
Capital Trust."
DEFINITIONS
[Section 2] ((SECTION 2)). Wherever used herein, unless otherwise
required by the context or specifically provided:
(a) The [T]terms "Affiliated Person,"[,] "Assignment,"[,]
"Commission,"[,] "Interested Person,"[,] "Majority Shareholder Vote"
(the 67% or 50% requirement of the third sentence of Section 2(a)(42)
of the 1940 Act, whichever may be applicable), and "Principal
Underwriter" shall have the meanings given them in the 1940 Act, as
((modified by or interpreted by any applicable order or orders of the
Commission or any rules or regulations adopted or interpretative
releases of the Commission thereunder)) [amended from time to time];
(b) (("Bylaws" shall mean the bylaws of the Trust, if any, as amended
from time to time));
(c) (("Class" refers to the class of Shares of a Series of the Trust
established in accordance with the provisions of Article III));
(d) (("Declaration of Trust" means this Amended and Restated
Declaration of Trust, as further amended or restated, from time to
time;))
(((e)))[(c)]"Net Asset Value" means the net asset value of each
Series of the Trust ((or Class thereof)) determined in the manner
provided in Article X, Section 3;
(((f))) [(d)]"Shareholder" means a record owner of Shares of the
Trust;
(((g))) [(f)]"Shares" means the equal proportionate transferable
units of interest into which the beneficial interest of ((the Trust
or)) each Series shall be divided from time to time, ((including such
Class or Classes of Shares as the Trustees may from time to time
create and establish)) and ((including)) [includes] fractions of
[s]((S))hares as well as whole [s]((S))hares ((as)) consistent with
the requirements of Federal and/or [other] ((state)) securities laws;
[and]
(h) "Series" refers to ((any)) series of Shares of the Trust
established in accordance with the provisions of Article III[.];
(((i)))[(b)] [The] "Trust" refers to Fidelity Capital Trust and
reference to the Trust, when applicable to one or more Series of the
Trust, shall refer to any such Series;
(((j)))[(e)] [The] "Trustees" refer to the individual trustees in
their capacity as trustees hereunder of the Trust and their successor
or successors for the time being in office as such trustee or
trustees; ((and))
(((k)))[(g)][The] "1940 Act" refers to the Investment Company Act of
1940, as amended from time to time. [; and]
ARTICLE II
PURPOSE OF TRUST
The purpose of this Trust is to provide investors a continuous source
of managed investment in securities.
ARTICLE III
BENEFICIAL INTEREST
SHARES OF BENEFICIAL INTEREST
[Section 1]((SECTION 1)). The beneficial interest in the Trust shall
be divided into such transferable Shares of one or more separate and
distinct Series ((or Classes of Series)) as the Trustees shall, from
time to time, create and establish. The number of ((authorized))
Shares ((of each Series, and Class thereof)), is unlimited((.)) [and]
[e]((E))ach Share shall be without par value and shall be fully paid
and nonassessable. The Trustees shall have full power and authority,
in their sole discretion, and without obtaining any prior
authorization or vote of the Shareholders ((of any Series or Class))
of the Trust (((a))) 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[,]; (((b))) to divide or combine the
Shares ((or any Series or Classes thereof)) into a greater or lesser
number[,]((; (c))) to classify or reclassify any issued Shares into
one or more Series ((or Classes)) of Shares[,] ((; (d))) to abolish
any one or more Series ((or)) ((Classes)) of Shares[,]; and (((e))) to
take such other action with respect to the Shares as the Trustees may
deem desirable.
[ESTABLISHMENT OF SERIES]
((ESTABLISHMENT OF SERIES AND CLASSES))
[Section 2]((SECTION 2)). The establishment of any Series ((or Class
thereof)) shall be effective upon the adoption of a resolution by a
majority of the then Trustees setting forth such establishment and
designation and the relative rights and preferences of the Shares of
such Series ((or Class, whether directly in such resolution or by
reference to, or approval of, another document that sets forth such
relative rights and preferences of the Shares of such Series or Class
including, without limitation, any registration statement of the
Trust, or as otherwise provided in such resolution)). At any time that
there are no Shares outstanding of any particular Series ((or Class))
previously established and designated, the Trustees may by a majority
vote abolish [that] ((such)) Series ((or Class)) and the establishment
and designation thereof.
OWNERSHIP OF SHARES
[Section 3]((SECTION 3)). The ownership of Shares shall be recorded
in the books of the Trust ((or a transfer or similar agent)). The
Trustees may make such rules as they consider appropriate for the
transfer of Shares and similar matters. The record books of the Trust
((as kept by the Trust or by any transfer or similar agent, as the
case may be,)) shall be conclusive as to who are the holders of Shares
and as to the number of Shares held from time to time by each
Shareholder.
INVESTMENT IN THE TRUST
[Section 4]((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 ((, or other property)) 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 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 ((or other fee)) upon
investments in the Trust ((or Series or any Classes thereof,)) and (b)
issue fractional Shares.
[ASSETS AND LIABILITIES OF SERIES]
((ASSETS AND LIABILITIES OF SERIES AND CLASSES))
[Section 5]((SECTION 5)). All consideration received by the Trust for
the issue or sale of Shares of a particular Series, together with all
assets in which such consideration is invested or reinvested, all
income, earnings, profits, and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation of such
assets, and any funds or payments derived from any reinvestment of
such proceeds in whatever form the same may be, shall be referred to
as "assets belonging to" that Series. In addition, any assets, income,
earnings, profits, and proceeds thereof, funds, or payments ((that))
[which] are not readily identifiable as belonging to any particular
Series ((or Class,)) shall be allocated by the Trustees between and
among one or more of the Series ((or Classes)) in such manner as they,
in their sole discretion, deem fair and equitable. Each such
allocation shall be conclusive and binding upon the Shareholders of
all Series ((or Classes)) for all purposes[,] and shall be referred to
as assets belonging to that Series ((or Class)). The assets belonging
to a particular Series shall be so recorded upon the books of the
Trust[,] ((or of its agent or agents))[,] and shall be held by the
Trustees in [T]((t))rust for the benefit of the holders of Shares of
that Series.
The assets belonging to each particular Series shall be charged with
the liabilities of that Series and all expenses, costs, charges, and
reserves attributable to that Series ((, except that liabilities and
expenses may, in the Trustees' discretion, be allocated solely to a
particular Class and, in which case, shall be borne by that Class)).
Any general liabilities, expenses, costs, charges, or reserves of the
Trust [which] ((that)) are not readily identifiable as belonging to
any particular Series ((or Class)) shall be allocated and charged by
the Trustees between or among any one or more of the Series ((or
Classes)) in such manner as the Trustees, in their sole discretion,
deem fair and equitable ((and shall be referred to as "liabilities
belonging to" that Series or Class)). Each such allocation shall be
conclusive and binding upon the Shareholders of all Series ((or
Classes)) for all purposes. Any creditor of any Series may look only
to the assets of that Series to satisfy such creditor's debt. ((No
Shareholder or former Shareholder of any Series shall have a claim on
or any right to any assets allocated or belonging to any other
Series.))
NO PREEMPTIVE RIGHTS
[Section 6]((SECTION 6)). Shareholders shall have no preemptive or
other right to subscribe to any additional Shares or other securities
issued by the Trust or the Trustees.
[LIMITATION OF PERSONAL LIABILITY]
((STATUS OF SHARES AND LIMITATION OF PERSONAL LIABILITY))
[Section 7]((SECTION 7)). ((Shares shall be deemed to be personal
property giving only the rights provided in this instrument. Every
shareholder by virtue of having become a shareholder shall be held to
have expressly assented and agreed to be bound by the terms hereof. No
Shareholder of the Trust and of each Series shall be personally liable
for the debts, liabilities, obligations, and expenses incurred by,
contracted for, or otherwise existing with respect to, the Trust or by
or on behalf of any Series.)) The Trustees shall have no power to bind
any Shareholder personally or to call upon any [s]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. Every note, bond, contract,
or other undertaking issued by or on behalf of the Trust or the
Trustees relating to the Trust ((or to a Series)) shall include a
recitation limiting the obligation represented thereby to the Trust
((or to one or more Series)) and its ((or their)) assets (but the
omission of such a recitation shall not operate to bind any
Shareholder ((or Trustee))).
ARTICLE IV
THE TRUSTEES
MANAGEMENT OF THE TRUST
[Section 1]((SECTION 1)). The business and affairs of the Trust shall
be managed by the Trustees, and they shall have all powers necessary
and desirable to carry out that responsibility.
[ELECTION: INITIAL TRUSTEES]
((INITIAL TRUSTEES; ELECTION))
[Section 2]((SECTION 2)). ((The initial Trustees shall be at least
three individuals who shall affix their signatures hereto.)) On a date
fixed by the Trustees, the Shareholders shall elect not less than
three Trustees. A Trustee shall not be required to be a Shareholder of
the Trust. [The initial Trustees shall be Edward C. Johnson 3d, Caleb
Loring, Jr. and Frank Nesvet and such other individuals as the Board
of Trustees shall appoint pursuant to Section 4 of the Article IV.]
TERM OF OFFICE OF TRUSTEES
[Section 3]((SECTION 3)). The Trustees shall hold office during the
lifetime of this Trust, and until its termination as hereinafter
provided; except (a) that any Trustee may resign his trust by written
instrument signed by him and delivered to the other Trustees, which
shall take effect upon such delivery or upon such later date as is
specified therein; (b) that any Trustee may be removed at any time by
written instrument, signed by at least two-thirds (((2/3))) of the
number of Trustees prior to such removal, specifying the date when
such removal shall become effective; (c) that any Trustee who requests
in writing to be retired or who has become incapacitated by illness or
injury may be retired by written instrument signed by a majority of
the other Trustees, specifying the date of his retirement; and (d) a
Trustee may be removed at any [S]((s))pecial [M]((m))eeting of the
Trust by a vote of two-thirds (((2/3))) of the outstanding Shares.
RESIGNATION AND APPOINTMENT OF TRUSTEES
[Section 4]((SECTION 4)). In case of the declination, death,
resignation, retirement, ((or)) removal [, incapacity, or inability]
of any of the Trustees, ((or)) in case a vacancy shall, by reason of
an increase in number ((of the Trustees,)) or for any other reason,
exist, the remaining Trustees shall fill such vacancy by appointing
such other person as they in their discretion shall see fit consistent
with the limitations under the [Investment Company Act of] 1940
((Act)). Such appointment shall be evidenced by a written instrument
signed by a majority of the Trustees in office or by recording in the
records of the Trust, whereupon the appointment shall take effect. An
appointment of a Trustee may be made by the Trustees then in office in
anticipation of a vacancy to occur by reason of retirement,
resignation, or increase in number of Trustees effective at a later
date, provided that said appointment shall become effective only at or
after the effective date of said retirement, resignation, or increase
in number of Trustees. As soon as any Trustee so appointed shall have
accepted this [t]((T))rust, the [t]((T))rust estate shall vest in the
new Trustee or Trustees, together with the continuing Trustees,
without any further act or conveyance, and he shall be deemed a
Trustee hereunder. The ((foregoing)) power of appointment is subject
to the provisions of Section 16(a) of the 1940 Act[.] ((, as modified
by or interpreted by any applicable order or orders of the Commission
or any rules or regulations adopted or interpretative releases of the
Commission.))
[TEMPORARY ABSENCE OF TRUSTEE]
((TEMPORARY ABSENCE OF TRUSTEES))
[Section 5]((SECTION 5)). Any Trustee may, by power of attorney,
delegate his power for a period not exceeding six (((6))) months at
any one time to any other Trustee or Trustees, provided that in no
case shall less than two Trustees personally exercise the other powers
hereunder except as herein otherwise expressly provided.
NUMBER OF TRUSTEES
[Section 6]((SECTION 6)). The number of Trustees, not less than three
(3) nor more than twelve (12), serving hereunder at any time shall be
determined by the Trustees themselves.
Whenever a vacancy in the Board of Trustees shall occur, until such
vacancy is filled, or while any Trustee is [absent from the
Commonwealth of Massachusetts or, if not a domiciliary of
Massachusetts, is absent from his state of domicile, or is] physically
or mentally incapacitated by reason of disease or otherwise, the other
Trustees shall have all the powers hereunder and the certificate of
the other Trustees of such vacancy [, absence] or incapacity[,] shall
be conclusive [, provided, however, that no vacancy shall remain
unfilled for a period longer than six calendar months].
EFFECT OF DEATH, RESIGNATION, ETC. OF A TRUSTEE
[Section 7]((SECTION 7)). The death, declination, resignation,
retirement, removal, incapacity, or inability of the Trustees, or any
one of them, shall not operate to annul the Trust or to revoke any
existing agency created pursuant to the terms of this Declaration of
Trust.
OWNERSHIP OF ASSETS OF THE TRUST
[Section 8]((SECTION 8)). The assets of the Trust shall be held
separate and apart from any assets now or hereafter held in any
capacity other than as Trustee hereunder by the Trustees or any
successor Trustees. All of the assets of the Trust shall at all times
be considered as vested in the Trustees. No Shareholder shall be
deemed to have a severable ownership in any individual asset of the
Trust or any right of partition or possession thereof, but each
Shareholder shall have a proportionate undivided beneficial interest
in the Trust ((or Series)).
ARTICLE V
POWERS OF THE TRUSTEES
POWERS
[Section 1]((SECTION 1)). The Trustees, in all instances, shall act
as principals[,] and are and shall be free from the control of the
Shareholders. The Trustees shall have full power and authority to do
any and all acts and to make and execute any and all contracts and
instruments that they may consider necessary or appropriate in
connection with the management of the Trust. ((Except as otherwise
provided herein or in the 1940 Act, t))[T]he Trustees shall not in any
way be bound or limited by present or future laws or customs in regard
to trust investments, but shall have full authority and power to make
any and all investments ((that)) [which] they, in their [uncontrolled]
discretion, shall deem proper to accomplish the purpose of this Trust.
Subject to any applicable limitation in [the] ((this)) Declaration of
Trust or the Bylaws of the Trust, ((if any,)) the Trustees shall have
power and authority:
(a) To invest and reinvest cash and other property, and to hold cash
or other property uninvested[,] without, in any event, being bound or
limited by any present or future law or custom in regard to
investments by Trustees, and to sell, exchange, lend, pledge,
mortgage, hypothecate, write options on, and lease any or all of the
assets of the Trust.
(b) To adopt Bylaws not inconsistent with this Declaration of Trust
providing for the conduct of the business of the Trust and to amend
and repeal them to the extent that they do not reserve that right to
the Shareholders.
(c) To elect and remove such officers and appoint and terminate such
agents as they consider appropriate.
(d) To employ [a] ((one or more)) bank((s,)) [or] trust [company]
((companies, companies that are members of a national securities
exchange, or other entities permitted under the 1940 Act, as modified
by or interpreted by any applicable order or orders of the Commission
or any rules or regulations adopted or interpretative releases of the
Commission thereunder,)) as custodians of any assets of the Trust
subject to any conditions set forth in this Declaration of Trust or in
the Bylaws, if any.
(e) To retain a transfer agent and Shareholder servicing agent, or
both.
(f) To provide for the distribution of interests of the Trust either
through a [p]((P))rincipal [u]((U))nderwriter in the manner
hereinafter provided for or by the Trust itself, or both.
(g) To set record dates in the manner hereinafter provided for.
(h) To delegate such authority as they consider desirable to any
officers of the Trust and to any ((investment adviser, manager,))
[agent,] custodian, [or] underwriter[.]((, or other agent or
independent contractor.))
(i) To sell or exchange any or all of the assets of the Trust,
subject to the provisions of Article XII, Section 4[(b)] hereof.
(j) To vote or give assent[,] or exercise any rights of ownership[,]
with respect to stock or other securities or property; and to execute
and deliver powers of attorney to such person or persons as the
Trustees shall deem proper, granting to such person or persons such
power and discretion with relation to securities or property as the
Trustees shall deem proper.
(k) To exercise powers and rights of subscription or otherwise which
in any manner arise out of ownership of securities.
(l) To hold any security or property in a form not indicating any
trust, whether in bearer, unregistered, or other negotiable form; or
either in its own name or in the name of a custodian or a nominee or
nominees. [, subject in either case to proper safeguards according to
the usual practice of Massachusetts trust companies or investment
companies.]
(m) To establish separate and distinct Series with separately defined
investment objectives and policies and distinct investment purposes in
accordance with the provisions of Article III ((and to establish
Classes of such Series having relative rights, powers, and duties as
the Trustees may provide consistent with applicable laws)).
(n) To allocate assets, liabilities, and expenses of the Trust to a
particular Series ((or Class, as appropriate,)) or to apportion the
same between or among two or more Series ((or Classes, as
appropriate)), provided that any liabilities or expenses incurred by a
particular Series ((or Class)) shall be payable solely out of the
assets belonging to that Series as provided for in Article III.
(o) To consent to or participate in any plan for the reorganization,
consolidation, or merger of any corporation or concern, any security
of which is held in the Trust; to consent to any contract, lease,
mortgage, purchase, or sale of property by such corporation or
concern, and to pay calls or subscriptions with respect to any
security held in the Trust.
(p) To compromise, arbitrate, or otherwise adjust claims in favor of
or against the Trust or any matter in controversy, including, but not
limited to, claims for taxes.
(q) To make distributions of income and of capital gains to
Shareholders in the manner hereinafter provided for.
(r) To borrow money, and to pledge, mortgage, or hypothecate the
assets of the Trust, subject to ((the)) applicable requirements of the
1940 Act.
(s) To establish, from time to time, a minimum total investment for
Shareholders[,] and to require the redemption of the Shares of any
Shareholders whose investment is less than such minimum upon giving
notice to such Shareholder.
(((t) To operate as and carry on the business of an investment
company and to exercise all the powers necessary and appropriate to
the conduct of such operations.))
(((u) To interpret the investment policies, practices or limitations
of any Series.))
(((v) To issue, sell, repurchase, redeem, retire, cancel, acquire,
hold, resell, reissue, dispose of, and otherwise deal in Shares and,
subject to the provisions set forth in Article III and Article X, to
apply to any such repurchase, redemption, retirement, cancellation or
acquisition of Shares any funds or property of the Trust, or the
particular Series of the Trust, with respect to which such Shares are
issued.))
[(t)](((w))) Notwithstanding any other provision hereof, to invest
all ((or a portion)) of the assets of any [s]((S))eries in ((one or
more)) [a single] open-end investment compan((ies))[y], including
investment by means of transfer of such assets in exchange for an
interest or interests in such investment company[;] ((or companies or
by any other method approved by the Trustees.))
(((x) In general to carry on any other business in connection with or
incidental to any of the foregoing powers, to do everything necessary,
suitable or proper for the accomplishment of any purpose or the
attainment of any object or the furtherance of any power hereinbefore
set forth, either alone or in association with others, and to do every
other act or thing incidental or appurtenant to or growing out of or
connected with the aforesaid business or purposes, objects or
powers.))
((The foregoing clauses shall be construed both as objects and
powers, and the foregoing enumeration of specific powers shall not be
held to limit or restrict in any manner the general powers of the
Trustees. Any action by one or more of the Trustees in their capacity
as such hereunder shall be deemed an action on behalf of the Trust or
the applicable Series and not an action in an individual capacity.))
((The Trustees shall not be limited to investing in obligations
maturing before the possible termination of the Trust or any Series or
Class thereof.))
No one dealing with the Trustees shall be under any obligation to
make any inquiry concerning the authority of the Trustees, or to see
to the application of any payments made or property transferred to the
Trustees or upon their order.
TRUSTEES AND OFFICERS AS SHAREHOLDERS
[Section 2]((SECTION 2)). Any Trustee, officer or other agent of the
Trust may acquire, own and dispose of Shares to the same extent as if
he were not a Trustee, officer or agent; and the Trustees may issue
and sell or cause to be issued and sold Shares to and buy such Shares
from any such person of any firm or company in which he is interested,
subject only to the general limitations herein contained as to the
sale and purchase of such Shares; and all subject to any restrictions
which may be contained in the Bylaws((, if any)).
ACTION BY THE TRUSTEES
[Section 3]((SECTION 3)) ((Except as otherwise provided herein or in
the 1940 Act, ))[T]((t))he Trustees shall act by majority vote at a
meeting duly called or by unanimous written consent without a meeting
or by telephone consent provided a quorum of Trustees participate in
any such telephonic meeting, unless the 1940 Act requires that a
particular action be taken only at a meeting [of] ((at which)) the
Trustees ((are present in person)). At any meeting of the Trustees, a
majority of the Trustees shall constitute a quorum. Meetings of the
Trustees may be called orally or in writing by the Chairman of the
Trustees or by any two other Trustees. Notice of the time, date, and
place of all meetings of the Trustees shall be given by the party
calling the meeting to each Trustee by telephone((, telefax,)) [or]
telegram((, or other electro-mechanical means)) sent to his home or
business address at least twenty-four (24))) hours in advance of the
meeting or by written notice mailed to his home or business address at
least seventy-two (((72))) hours in advance of the meeting. Notice
need not be given to any Trustee who attends the meeting without
objecting to the lack of notice or who executes a written waiver of
notice with respect to the meeting. Subject to the requirements of the
1940 Act, the Trustees by majority vote may delegate to any one of
their number their authority to approve particular matters or take
particular actions on behalf of the Trust. ((Written consents or
waivers of Trustees may be executed in one or more counterparts.
Execution of a written consent or waiver and delivery thereof to the
Trust may be accomplished by telefax or other electro-mechanical
means.))
CHAIRMAN OF THE TRUSTEES
[Section 4]((SECTION 4)). The Trustees may appoint one of their
number to be Chairman of the Board of Trustees. The Chairman shall
preside at all meetings of the Trustees, shall be responsible for the
execution of policies established by the Trustees and the
administration of the Trust, and may be the chief executive, financial
and accounting officer of the Trust.
ARTICLE VI
EXPENSES OF THE TRUST
TRUSTEE REIMBURSEMENT
[Section 1]((SECTION 1)). Subject to the provisions of Article III,
Section 5, the Trustees shall be reimbursed from the Trust estate or
the assets belonging to the appropriate Series for their expenses and
disbursements, including, without limitation, fees and expenses of
Trustees who are not Interested Persons of the Trust[,]((;)) interest
expense, taxes, fees and commissions of every kind[,]((;)) expenses of
pricing Trust portfolio securities[,]((;)) expenses of issue,
repurchase and redemption of shares including expenses attributable to
a program of periodic repurchases or redemptions, expenses of
registering and qualifying the Trust and its Shares under Federal and
[S]((s))tate laws and regulations[,]((;)) charges of custodians,
transfer agents, and registrars[,]((;)) expenses of preparing and
setting up in type [P]((p))rospectuses and [S]((s))tatements of
[A]((a))dditional [I]((i))nformation[,]((;)) expenses of printing and
distributing prospectuses sent to existing Shareholders[,]((;))
auditing and legal expenses[,]((;)) reports to Shareholders[,]((;))
expenses of meetings of Shareholders and proxy solicitations
therefor[,]((;)) insurance expense[,]((;)) association membership
dues; and for such non-recurring items as may arise, including
litigation to which the Trust is a party[,]((;)) and for all losses
and liabilities by them incurred in administering the Trust, and for
the payment of such expenses, disbursements, losses((,)) and
liabilities the Trustees shall have a lien on the assets belonging to
the appropriate Series prior to any rights or interests of the
Shareholders thereto. This section shall not preclude the Trust from
directly paying any of the aforementioned fees and expenses.
ARTICLE VII
[INVESTMENT ADVISER, PRINCIPAL UNDERWRITER AND TRANSFER AGENT]
((INVESTMENT ADVISER, PRINCIPAL UNDERWRITER, AND TRANSFER AGENT))
INVESTMENT ADVISER
[Section 1]((SECTION 1)). Subject to [a Majority Shareholder Vote]
((applicable requirements of the 1940 Act, as modified by or
interpreted by any applicable order of the Commission or any rules or
regulations adopted or interpretative releases of the Commission
thereunder,)) the Trustees may((,)) in their discretion ((and)) from
time to time((,)) enter into an investment advisory or management
contract(s) with respect to the Trust or any Series thereof whereby
the other party(ies) to such contract(s) shall undertake to furnish
the Trustees such management, investment advisory, statistical((,))
and research facilities and services and such other facilities and
services, if any, and all upon such terms and conditions, as the
Trustees may((,)) in their discretion((,)) determine. Notwithstanding
any provisions of this Declaration of Trust, the Trustees may
authorize the investment adviser(s) (subject to such general or
specific instructions as the Trustees may from time to time adopt) to
effect purchases, sales or exchanges of portfolio securities and other
investment instruments of the Trust on behalf of the Trustees or may
authorize any officer, agent, or Trustee to effect such purchases,
sales((,)) or exchanges pursuant to recommendations of the investment
adviser (and all without further action by the Trustees). Any such
purchases, sales((,)) and exchanges shall be deemed to have been
authorized by all of the Trustees.
The Trustees may, subject to applicable requirements of the 1940 Act,
((as modified by or interpreted by any applicable order or orders of
the Commission or any rules or regulations adopted or interpretative
releases of the Commission thereunder,)) including those relating to
Shareholder approval, authorize the investment adviser to employ one
or more sub-advisers from time to time to perform such of the acts and
services of the investment adviser, and upon such terms and
conditions, as may be agreed upon between the investment adviser and
sub-adviser.
PRINCIPAL UNDERWRITER
[Section 2]((SECTION 2)). The Trustees may in their discretion from
time to time enter into [(a)] ((an exclusive or non-exclusive))
contract(s) ((on behalf of Trust or any Series or Class thereof))
providing for the sale of the Shares, whereby the Trust may either
agree to sell the Shares to the other party to the contract or appoint
such other party its sales agent for such Shares. In either case, the
contract shall be on such terms and conditions as may be prescribed in
the Bylaws, if any, and such further terms and conditions as the
Trustees may, in their discretion((,)) determine not inconsistent with
the provisions of this Article VII[,] or of the Bylaws, if any((.))[;
and] [s]((S))uch contract may also provide for the repurchase or sale
of Shares by such other party as principal or as agent of the Trust.
TRANSFER AGENT
[Section 3]((SECTION 3)). The Trustees may, in their discretion
((and)) from time to time((,)) enter into [a]((one or more)) transfer
agency and Shareholder service contract[(s)]((s)) whereby the other
party shall undertake to furnish the Trustees with transfer agency and
Shareholder services. [The]((Such)) contract((s)) shall be on such
terms and conditions as the Trustees may((,)) in their discretion((,))
determine not inconsistent with the provisions of this Declaration of
Trust or of the Bylaws, if any. Such services may be provided by one
or more entities.
PARTIES TO CONTRACT
[Section 4]((SECTION 4)). Any contract of the character described in
Sections 1, 2 and 3 of this Article VII or in Article IX hereof may be
entered into with any corporation, firm, partnership, trust or
association, although one or more of the Trustees or officers of the
Trust may be an officer, director, trustee, shareholder, or member of
such other party to the contract, and no such contract shall be
invalidated or rendered voidable by reason of the existence of any
relationship, nor shall any person holding such relationship be liable
merely by reason of such relationship for any loss or expense to the
Trust under or by reason of said contract or accountable for any
profit realized directly or indirectly therefrom, provided that the
contract when entered into was reasonable and fair and not
inconsistent with the provisions of this Article VII or the Bylaws, if
any. The same person (including a firm, corporation, partnership,
trust, or association) may be the other party to contracts entered
into pursuant to Sections 1, 2 and 3 above or Article IX, and any
individual may be financially interested or otherwise affiliated with
persons who are parties to any or all of the contracts mentioned in
this Section 4.
PROVISIONS AND AMENDMENTS
[Section 5]((SECTION 5)). Any contract entered into pursuant to
Sections 1 and 2 of this Article VII shall be consistent with and
subject to the requirements of Section 15 of the 1940 Act((, as
modified by or interpreted by any applicable order or orders of the
Commission or any rules or regulations adopted or interpretative
releases of the Commission (or)) [(including any amendments thereof
or] other applicable Act of Congress hereafter enacted)((,)) with
respect to its continuance in effect, ((its amendment,)) its
termination, and the method of authorization and approval of such
contract or renewal thereof [, and no amendment to any contract,
entered into pursuant to Section 1 shall be effective unless assented
to by a Majority Shareholder Vote].
ARTICLE VIII
SHAREHOLDERS' VOTING POWERS AND MEETINGS
VOTING POWERS
[Section 1]((SECTION 1)). The Shareholders shall have power to vote
[(i)](((a))) for the election of Trustees as provided in Article IV,
Section 2[,]((;)) [(ii)](((b))) for the removal of Trustees as
provided in Article IV, Section 3(d)[,] [(iii)]((; (c))) with respect
to any investment advisory or management contract as provided in
Article VII, Sections 1 and 5[,][(iv)]((; (d) with respect to any
termination, merger, consolidation, reorganization, or sale of assets
of the Trust or any of its Series or Classes as provided in Article
XII, Section 4; (e))) with respect to the amendment of this
Declaration of Trust as provided in Article XII, Section 7[,]((;))
[(v)](((f))) to the same extent as the shareholders of a Massachusetts
business corporation, as to whether or not a court action, proceeding
or claim should be brought or maintained derivatively or as a class
action on behalf of the Trust or the Shareholders, provided, however,
that a Shareholder of a particular Series shall not be entitled to
bring any derivative or class action on behalf of any other Series of
the Trust[,]((;)) and [(vi)](((g))) with respect to such additional
matters relating to the Trust as may be required or authorized by law,
by this Declaration of Trust, or the Bylaws of the Trust, if any, or
any registration of the Trust with the [Securities and Exchange]
Commission [(the "Commission")] or any [S]((s))tate, as the Trustees
may consider desirable.
On any matter submitted to a vote of the Shareholders, all
[s]((S))hares shall be voted by individual Series, ((except as
provided in the following sentence and)) except [(i)](((a))) when
required by the 1940 Act, Shares shall be voted in the aggregate and
not by individual Series; and [(ii)](((b))) when the Trustees have
determined that the matter affects only the interests of one or more
Series, then only the Shareholders of such Series shall be entitled to
vote thereon. ((The Trustees may also determine that a matter affects
only the interests of one or more Classes of a Series, in which case,
any such matter shall be voted on by such Class or Classes.)) A
Shareholder of each Series ((or Class thereof)) shall be entitled to
one vote for each dollar of net asset value (number of Shares owned
times net asset value per share) of such Series[,](( or Class
thereof)) on any matter on which such Shareholder is entitled to vote,
and each fractional dollar amount shall be entitled to a proportionate
fractional vote. There shall be no cumulative voting in the election
of Trustees. Shares may be voted in person or by proxy. Until Shares
are issued, the Trustees may exercise all rights of Shareholders and
may take any action required or permitted by law, this Declaration of
Trust or any Bylaws of the Trust((, if any,)) to be taken by
Shareholders.
MEETINGS
[Section 2]((SECTION 2)). The first Shareholders' meeting shall be
held as specified in Section 2 of Article IV at the principal office
of the Trust or such other place as the Trustees may designate.
Special meetings of the Shareholders of any Series may be called by
the Trustees and shall be called by the Trustees upon the written
request of Shareholders owning at least one-tenth (((1/10))) of the
outstanding Shares entitled to vote. Whenever ten or more Shareholders
meeting the qualifications set forth in Section 16(c) of the 1940 Act,
((as modified by or interpreted by any applicable order or orders of
the Commission or any rules or regulations adopted or interpretative
releases of the Commission)) [as the same may be amended from time to
time], seek the opportunity of furnishing materials to the other
Shareholders with a view to obtaining signatures on such a request for
a meeting, the Trustees shall comply with the provisions of said
Section 16(c) with respect to providing such Shareholders access to
the list of the Shareholders of record of the Trust or the mailing of
such materials to such Shareholders of record. Shareholders shall be
entitled to at least fifteen (((15))) days' notice of any meeting.
QUORUM AND REQUIRED VOTE
[Section 3]((SECTION 3)). A majority of Shares entitled to vote in
person or by proxy shall be a quorum for the transaction of business
at a Shareholders' meeting, except that where any provision of law or
of this Declaration of Trust permits or requires that holders of any
Series ((or Class)) shall vote as a Series ((or Class)) then a
majority of the aggregate number of Shares of that Series ((or Class))
entitled to vote shall be necessary to constitute a quorum for the
transaction of business by that Series ((or Class)). Any lesser number
shall be sufficient for adjournments. Any adjourned session or
sessions may be held, within a reasonable time after the date set for
the original meeting, without the necessity of further notice. Except
when a larger vote is required ((by applicable law or)) by any
provision of this Declaration of Trust or the Bylaws, ((if any,)) a
majority of the Shares voted in person or by proxy shall decide any
questions and a plurality shall elect a Trustee, provided that where
any provision of law or of this Declaration of Trust permits or
requires that the holders of any Series ((or Class)) shall vote as a
Series ((or Class)), then a majority of the Shares of that Series ((or
Class)) voted on the matter shall decide that matter insofar as that
Series ((or Class)) is concerned. ((Shareholders may act by unanimous
written consent. Actions taken by a Series or Class may be consented
to unanimously in writing by Shareholders of that Series or Class.))
ARTICLE IX
CUSTODIAN
APPOINTMENT AND DUTIES
[Section 1]((SECTION 1)). The Trustees shall at all times employ a
bank((, a company that is a member of a national securities
exchange,)) [or] trust company((, or other entity permitted under the
1940 Act, as modified by or interpreted by any applicable order or
orders of the Commission or any rules or regulations adopted or
interpretative releases of the Commission thereunder,)) having
capital, surplus((,)) and undivided profits of at least two million
dollars ($2,000,000), or such other amount [or such other entity] as
shall be allowed by the Commission or by the 1940 Act, as custodian
with authority as its agent, but subject to such restrictions,
limitations and other requirements, if any, as may be contained in the
Bylaws of the Trust((, if any)):
(1) to hold the securities owned by the Trust and deliver the same
upon written order or oral order, if confirmed in writing, or by such
electro-mechanical or electronic devices as are agreed to by the Trust
and the custodian, if such procedures have been authorized in writing
by the Trust;
(2) to receive and receipt for any moneys due to the Trust and
deposit the same in its own banking department or elsewhere as the
Trustees may direct; and
(3) to disburse such funds upon orders or vouchers;
and the Trust may also employ such custodian as its agent:
(1) to keep the books and accounts of the Trust and furnish clerical
and accounting services; and
(2) to compute, if authorized to do so [by] ((,)) the [Trustees, the]
Net Asset Value of any Series ((or Class thereof ))in accordance with
the provisions hereof; all upon such basis of compensation as may be
agreed upon between the Trustees and the custodian. [If so directed by
a Majority Shareholder Vote, the custodian shall deliver and pay over
all property of the Trust held by it as specified in such vote.]
The Trustees may also authorize the custodian to employ one or more
sub-custodians from time to time to perform such of the acts and
services of the custodian, and upon such terms and conditions, as may
be agreed upon between the custodian and such sub-custodian and
approved by the Trustees, provided that in every case such
sub-custodian shall be a bank ((, a company that is a member of a
national securities exchange, ))[or] trust company ((, or other entity
permitted under the 1940 Act, as modified by or interpreted by any
applicable order or orders of the Commission or any rules or
regulations adopted or interpretative releases of the Commission
thereunder,)) [organized under the laws of the United States or one of
the states thereof and] having capital, surplus((,)) and [individual]
((undivided)) profits of at least two million dollars
($2,000,000)((,)) or such other [person] ((amount)) as [may] ((shall))
be [permitted] ((allowed)) by the Commission[,] or [otherwise in
accordance with] ((by)) the 1940 Act [as from time to time amended].
[CENTRAL CERTIFICATE SYSTEM]
((CENTRAL DEPOSITORY SYSTEM))
[Section 2]((SECTION 2)). Subject to such rules, regulations and
orders as the Commission may adopt, the Trustees may direct the
custodian to deposit all or any part of the securities owned by the
Trust in a system for the central handling of securities established
by a national securities exchange or a national securities association
registered with the Commission under the Securities Exchange Act of
1934[,] or such other person as may be permitted by the Commission[,]
or otherwise in accordance with the 1940 Act [as from time to time
amended], pursuant to which system all securities of any particular
class or series of any issuer deposited within the system are treated
as fungible and may be transferred or pledged by bookkeeping entry
without physical delivery of such securities[,]((;)) provided that all
such deposits shall be subject to withdrawal only upon the order of
the Trust ((or its custodian, subcustodians, or other authorized
agents)).
ARTICLE X
[DISTRIBUTIONS, AND REDEMPTIONS]
DISTRIBUTIONS, REDEMPTIONS AND DETERMINATION OF NET ASSET VALUE
DISTRIBUTIONS
[Section 1]((SECTION 1)).
(a) The Trustees may from time to time declare and pay dividends. The
amount of such dividends and the payment of them shall be wholly in
the discretion of the Trustees.
(b) The Trustees shall have ((the)) power, to the fullest extent
permitted by the laws of Massachusetts, at any time to declare and
cause to be paid dividends on Shares of a particular Series, from the
assets belonging to that Series, which dividends, at the election of
the Trustees, may be paid daily or otherwise pursuant to a standing
resolution or resolutions adopted only once or with such frequency as
the Trustees may determine, and may be payable in Shares of that
Series ((, or Classes thereof,)) at the election of each Shareholder
of that Series.
((The Trustees may adopt and offer to Shareholders such dividend
reinvestment plans, cash dividend payout plans, or related plans as
the Trustees shall deem appropriate.))
(c) Anything in this instrument to the contrary notwithstanding, the
Trustees may at any time declare and distribute ((a dividend of stock
or other property)) pro rata among the Shareholders of a particular
Series ((, or Class thereof,)) as of the record date of that Series
((or Class)) fixed as provided in ((Article XII,)) Section 3 [hereof a
"stock dividend"].
REDEMPTIONS
[Section 2]((SECTION 2)). In case any holder of record of Shares of a
particular Series ((or Class of a Series)) desires to dispose of his
Shares, he may deposit at the office of the transfer agent or other
authorized agent of that Series a written request or such other form
of request as the Trustees may, from time to time, authorize,
requesting that the Series purchase the Shares in accordance with this
Section 2; and the Shareholder so requesting shall be entitled to
require the Series to purchase, and the Series or the principal
underwriter of the Series shall purchase his said Shares, but only at
the Net Asset Value thereof (as described in Section 3 hereof). The
Series shall make payment for any such Shares to be redeemed, as
aforesaid, in cash or property from the assets of that Series((,)) and
payment for such Shares ((less any applicable deferred sales charges
and/or fees)) shall be made by the Series or the principal underwriter
of the Series to the Shareholder of record within seven (7) days after
the date upon which the request is effective.
[DETERMINATION OF NET ASSET VALUE]
((DETERMINATION OF NET ASSET VALUE AND VALUATION OF PORTFOLIO ASSETS))
[Section 3]((SECTION 3)). The term "Net Asset Value" of any Series
((or Class)) shall mean that amount by which the assets of that
Series[,]((or Class)) exceed its liabilities, all as determined by or
under the direction of the Trustees. Such value per Share shall be
determined separately for each Series ((or Class)) of Shares and shall
be determined on such days and at such times as the Trustees may
determine. Such determination shall be made with respect to securities
for which market quotations are readily available, at the market value
of such securities; and with respect to other securities and assets,
at the fair value as determined in good faith by the Trustees,
provided, however, that the Trustees, without Shareholder approval,
may alter the method of appraising portfolio securities insofar as
permitted under the 1940 Act and the rules, regulations((,)) and
interpretations thereof promulgated or issued by the Commission or
insofar as permitted by any [O]((o))rder of the Commission applicable
to the Series. The Trustees may delegate any of its powers and duties
under this Section 3 with respect to appraisal of assets and
liabilities. At any time((,)) the Trustees may cause the value [par]
((per)) Share last determined to be determined again in ((a)) similar
manner and may fix the time when such redetermined value shall become
effective.
SUSPENSION OF THE RIGHT OF REDEMPTION
[Section 4]((SECTION 4)). The Trustees may declare a suspension of
the right of redemption or postpone the date of payment as permitted
under the 1940 Act. Such suspension shall take effect at such time as
the Trustees shall specify((,)) but not later than the close of
business on the business day next following the declaration of
suspension, and thereafter there shall be no right of redemption or
payment until the Trustees shall declare the suspension at an end. In
the case of a suspension of the right of redemption, a Shareholder may
either withdraw his request for redemption or receive payment based on
the Net Asset Value per Share existing after the termination of the
suspension. ((In the event that any Series is divided into Classes,
the provisions of this Section, to the extent applicable as determined
in the discretion of the Trustees and consistent with applicable law,
may be equally applied to each such Class.))
((REDEMPTION OF SHARES))
((SECTION 5.)) ((The Trustees may require Shareholders to redeem
Shares for any reason under terms set by the Trustees, including, but
not limited to, (i) the determination of the Trustees that direct or
indirect ownership of Shares of any Series has or may become
concentrated in such Shareholder to an extent that would disqualify
any Series as a regulated investment company under the Internal
Revenue Code of 1986, as amended (or any successor statute thereto),
(ii) the failure of a Shareholder to supply a tax identification
number if required to do so, or (iii) the failure of a Shareholder to
pay when due for the purchase of Shares issued to him. The redemption
shall be effected at the redemption price and in the manner provided
in this Article X.))
((The holders of Shares shall upon demand disclose to the Trustees in
writing such information with respect to direct and indirect ownership
of Shares as the Trustees deem necessary to comply with the provisions
of the Internal Revenue Code, or to comply with the requirements of
any other taxing authority.))
ARTICLE XI
LIMITATION OF LIABILITY
[Section 1]((SECTION 1)). Provided they have exercised reasonable
care and have acted under the reasonable belief that their actions are
in the best interest of the Trust, the Trustees shall not be
responsible for or liable in any event for neglect or wrongdoing of
them or any officer, agent, employee, or investment adviser of the
Trust, but nothing contained herein shall protect any Trustee against
any liability to which he would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of his office.
[INDEMNIFICATION ]
((INDEMNIFICATION OF COVERED PERSONS))
[Section 2]((SECTION 2))
(a) Subject to the exceptions and limitations contained in Section
(b) below:
(i) every person who is, or has been, a Trustee or officer of the
Trust (hereinafter referred to as "Covered Person") shall be
indemnified by the appropriate Series to the fullest extent permitted
by law against liability and against all expenses reasonably incurred
or paid by him in connection with any claim, action, suit((,)) or
proceeding in which he becomes involved as a party or otherwise by
virtue of his being or having been a Trustee or officer and against
amounts paid or incurred by him in the settlement thereof;
(ii) the words "claim," "action," "suit," or "proceeding" shall
apply to all claims, actions, suits or proceedings (civil, criminal or
other, including appeals), actual or threatened while in office or
thereafter, and the words "liability" and "expenses" shall include,
without limitation, attorneys' fees, costs, judgments, amounts paid in
settlement, fines, penalties and other liabilities.
(b) No indemnification shall be provided hereunder to a Covered
Person:
(i) who shall have been adjudicated by a court or body before which
the proceeding was brought (A) to be liable to the Trust or its
Shareholders by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct
of his office((;)) or (B) not to have acted in good faith in the
reasonable belief that his action was in the best interest of the
Trust; or
(ii) in the event of a settlement, unless there has been a
determination that such Trustee or officer did not engage in willful
misfeasance, bad faith, gross negligence((,)) or reckless disregard of
the duties involved in the conduct of his office,
(A) by the court or other body approving the settlement;
(B) by at least a majority of those Trustees who are neither
[i]((I))nterested [p]((P))ersons of the Trust nor are parties to the
matter based upon a review of readily available facts (as opposed to a
full trial-type inquiry); or
(C) by written opinion of independent legal counsel based upon a
review of readily available facts (as opposed to a full trial-type
inquiry);
provided, however, that any Shareholder may, by appropriate legal
proceedings, challenge any such determination by the Trustees, or by
independent counsel.
(c) The rights of indemnification herein provided may be insured
against by policies maintained by the Trust, shall be severable, shall
not be exclusive of or affect any other rights to which any Covered
Person may now or hereafter be entitled, shall continue as to a person
who has ceased to be such Trustee or officer((,)) and shall inure to
the benefit of the heirs, executors, and administrators of such a
person. Nothing contained herein shall affect any rights to
indemnification to which Trust personnel, other than Trustees and
officers, and other persons may be entitled by contract or otherwise
under law.
(d) Expenses in connection with the preparation and presentation of a
defense to any claim, action, suit((,)) or proceeding of the character
described in [p]((P))aragraph (a) of this Section 2 may be paid by the
applicable Series from time to time prior to final disposition thereof
upon receipt of an undertaking by or on behalf of such Covered Person
that such amount will be paid over by him to the applicable Series if
it is ultimately determined that he is not entitled to indemnification
under this Section 2; provided, however, that either [(a)](((i))) such
Covered Person shall have provided appropriate security for such
undertaking[,] [(b)]((; (ii))) the Trust is insured against losses
arising out of any such advance payments((;)) or [(c)](((iii))) either
a majority of the Trustees who are neither interested persons of the
Trust nor parties to the matter, or independent legal counsel in a
written opinion, shall have determined, based upon a review of readily
available facts (as opposed to a trial-type inquiry or full
investigation), that there is reason to believe that such Covered
Person will be found entitled to indemnification under this Section 2.
[SHAREHOLDERS]
((INDEMNIFICATION OF SHAREHOLDERS))
[Section 3]((SECTION 3)). In case any Shareholder or former
Shareholder of any Series of the Trust shall be held to be 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 (or his heirs, executors,
administrators((,)) or other legal representatives or((,)) in the case
of a corporation or other entity, its corporate or other general
successor) 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. The Series shall, upon
request by the Shareholder, assume the defense of any claim made
against the Shareholder for any act or obligation of the Series and
satisfy any judgment thereon.
ARTICLE XII
MISCELLANEOUS
[TRUST NOT A PARTNERSHIP]
((TRUST NOT A PARTNERSHIP, ETC.))
[Section 1]((SECTION 1)). It is hereby expressly declared that a
trust ((is created hereby)) and not a partnership((, joint stock
association, corporation, bailment, or any form of a legal
relationship other than a trust.)) [is created hereby.] No Trustee
hereunder shall have any power to ((personally)) bind [personally]
either the Trust's officers or any Shareholder. All persons extending
credit to, contracting with((,)) or having any claim against the Trust
or the Trustees shall look only to the assets of the appropriate
Series for payment under such credit, contract((,)) or claim; and
neither the Shareholders nor the Trustees, nor any of their agents,
whether past, present((,)) or future, shall be personally liable
therefor. Nothing in this Declaration of Trust shall protect a Trustee
against any liability to which the Trustee would otherwise be subject
by reason of willful misfeasance, bad faith, gross negligence((,)) or
reckless disregard of the duties involved in the conduct of the office
of Trustee hereunder.
[TRUSTEE'S GOOD FAITH ACTION, EXPERT ADVICE, NO BOND OR SURETY]
((TRUSTEES' GOOD FAITH ACTION, EXPERT ADVICE, NO BOND OR SURETY))
[Section 2]((SECTION 2)). The exercise by the Trustees of their
powers and discretions hereunder in good faith and with reasonable
care under the circumstances then prevailing, shall be binding upon
everyone interested. Subject to the provisions of Section 1 of this
Article XII and to Article XI, the Trustees shall not be liable for
errors of judgment or mistakes of fact or law. The Trustees may take
advice of counsel or other experts with respect to the meaning and
operation of this Declaration of Trust, and subject to the provisions
of Section 1 of this Article XII and to Article XI, shall be under no
liability for any act or [O]((o))mission in accordance with such
advice or for failing to follow such advice. The Trustees shall not be
required to give any bond as such, nor any surety if a bond is
obtained.
ESTABLISHMENT OF RECORD DATES
[Section 3]((SECTION 3)). The Trustees may close the stock transfer
books of the Trust for a period not exceeding sixty (60) days
preceding the date of any meeting of Shareholders, or the date for the
payment of any dividend((s)), or the date for the allotment of rights,
or the date when any change or conversion or exchange of Shares shall
go into effect; or in lieu of closing the stock transfer books as
aforesaid, the Trustees may fix in advance a date not exceeding sixty
(60) days preceding the date of any meeting of Shareholders, or the
date for payment of any dividends, or the date for the allotment of
rights, or the date when any change or conversion or exchange of
Shares shall go into effect, as a record date for the determination of
the Shareholders entitled to notice of, and to vote at, any such
meeting, or entitled to receive payment of any such dividend, or to
any such allotment of rights, or to exercise the rights in respect of
any such change, conversion or exchange of Shares, and in such case
such Shareholders and only such Shareholders as shall be Shareholders
of record on the date so fixed shall be entitled to such notice of,
and to vote at, such meeting, or to receive payment of such dividend,
or to receive such allotment or rights, or to exercise such rights, as
the case may be, notwithstanding any transfer of any Shares on the
books of the Trust after any such record date fixed or aforesaid.
[TERMINATION OF TRUST]
((DURATION; TERMINATION OF TRUST, A SERIES OR A CLASS; MERGERS, ETC.))
[Section 4.]
[(a) This Trust shall continue without limitation of time but subject
to the provisions of sub-section (b) of this Section 4.]
[(b) Subject to a Majority Shareholder Vote of each Series affected
by the matter or, if applicable, to a Majority Shareholder Vote of the
Trust, the Trustees may]
((SECTION 4.1. DURATION. The Trust shall continue without limitation
of time, but subject to the provisions of this Article XII.))
((SECTION 4.2. TERMINATION OF THE TRUST, A SERIES OR A CLASS. (a)
Subject to applicable Federal and state law, the Trust or any Series
or Class thereof may be terminated (i) by Majority Shareholder Vote of
the Trust, each Series affected, or each Class affected, as the case
may be; or (ii) without the vote or consent of Shareholders by a
majority of the Trustees either at a meeting or by written consent.
The Trustees shall provide written notice to the affected Shareholders
of a termination effected under clause (ii) above. Upon the
termination of the Trust or the Series or Class,))
(i)(( the Trust or the Series or Class shall carry on no business
except for the purpose of winding up its affairs;)) [sell and convey
the assets of the Trust or any affected Series to another trust,
partnership, association or corporation organized under the laws of
any state which is a diversified open-end management investment
company as defined in the 1940 Act, for adequate consideration which
may include the assumption of all outstanding obligations, taxes and
other liabilities, accrued or contingent, of the Trust or any affected
Series, and which may include shares of beneficial interest or stock
of such trust, partnership, association or corporation; or]
(((ii) the Trustees shall proceed to wind up the affairs of the
Trust or the Series or Class, and all of the powers of the Trustees
under this Declaration of Trust shall continue until the affairs of
the Trust shall have been wound up, including the power to fulfill or
discharge the contracts of the Trust or the Series or Class thereof;
collect its assets; sell, convey, assign, exchange, transfer, or
otherwise dispose of all or any part of the remaining Trust property
or Trust property allocated or belonging to such Series or Class to
one or more persons at public or private sale for consideration that
may consist in whole or in part of cash, securities, or other property
of any kind; discharge or pay its liabilities; and do all other acts
appropriate to liquidate its business; provided that any sale,
conveyance, assignment, exchange, transfer, or other disposition of
all or substantially all the Trust property or Trust property
allocated or belonging to such Series or Class (other than as provided
in (iii) below) shall require Shareholder approval in accordance with
Section 4.3 below; and))
[(ii) at any time sell and convert into money all of the assets of
the Trust or any affected Series.]
[Upon making provision for the payment of all such liabilities in
either (i) or (ii), by such assumption or otherwise, the Trustees
shall distribute the remaining proceeds or assets (as the case may be)
ratably among the holders of the Shares of the Trust or any affected
Series then outstanding.]
(((iii) after paying or adequately providing for the payment of all
liabilities, and upon receipt of such releases, indemnities, and
refunding agreements as they deem necessary for their protection, the
Trustees may distribute the remaining Trust property or the remaining
property of the terminated Series or Class, in cash or in kind or
partly each, among the Shareholders of the Trust or the Series or
Class according to their respective rights; and))
[(c) Upon completion of the distribution of the remaining proceeds or
the remaining assets as provided in sub-section (b), the Trust or any
affected Series shall terminate and the Trustees shall be discharged
of any and all further liabilities and duties hereunder and the right,
title and interest of all parties shall be cancelled and discharged.]
(((b) after termination of the Trust or the Series or Class and
distribution to the Shareholders as herein provided, a majority of the
Trustees shall execute and lodge among the records of the Trust and
file with the Secretary of The Commonwealth of Massachusetts, if
required, an instrument in writing setting forth the fact of such
termination, and the Trustees shall thereupon be discharged from all
further liabilities and duties with respect to the Trust or the
terminated Series or Class, and the rights and interests of all
Shareholders of the Trust or the terminated Series or Class shall
thereupon cease.))
((SECTION 4.3. MERGER, CONSOLIDATION, AND SALE OF ASSETS. Subject to
applicable Federal and state law and except as otherwise provided in
Section 4.4 below, the Trust or any Series thereof may merge or
consolidate with any other corporation, association, trust, or other
organization or may sell, lease, or exchange all or a portion of the
Trust property or Trust property allocated or belonging to such Series
or Class, including its good will, upon such terms and conditions and
for such consideration when and as authorized at any meeting of
Shareholders called for such purpose by a Majority Shareholder Vote of
the Trust or affected Series or Class, as the case may be. Such
transactions may be effected through share-for-share exchanges,
transfers or sale of assets, shareholder in-kind redemptions and
purchases, exchange offers, or any other method approved by the
Trustees.))
((SECTION 4.4. INCORPORATION; REORGANIZATION. Subject to applicable
Federal and state law, the Trustees may without the vote or consent of
Shareholders cause to be organized or assist in organizing a
corporation or corporations under the laws of any jurisdiction or any
other trust, partnership, limited liability company, association, or
other organization to take over all or a portion of the Trust property
or all or a portion of the Trust property allocated or belonging to
such Series or Class or to carry on any business in which the Trust
shall directly or indirectly have any interest, and to sell, convey
and transfer the Trust property or the Trust property allocated or
belonging to such Series or Class to any such corporation, trust,
limited liability company, partnership, association, or organization
in exchange for the shares or securities thereof or otherwise, and to
lend money to, subscribe for the shares or securities of, and enter
into any contracts with any such corporation, trust, partnership,
limited liability company, association, or organization, or any
corporation, partnership, limited liability company, trust,
association, or organization in which the Trust or such Series holds
or is about to acquire shares or any other interest. Subject to
applicable Federal and state law, the Trustees may also cause a merger
or consolidation between the Trust or any successor thereto or any
Series or Class thereof and any such corporation, trust, partnership,
limited liability company, association, or other organization. Nothing
contained herein shall be construed as requiring approval of
Shareholders for the Trustees to organize or assist in organizing one
or more corporations, trusts, partnerships, limited liability
companies, associations, or other organizations and selling,
conveying, or transferring the Trust property or a portion of the
Trust property to such organization or entities; provided, however,
that the Trustees shall provide written notice to the affected
Shareholders of any transaction whereby, pursuant to this Section 4.4,
the Trust or any Series or Class thereof sells, conveys, or transfers
all or a portion of its assets to another entity or merges or
consolidates with another entity. Such transactions may be effected
through share-for-share exchanges, transfers or sale of assets,
shareholder in-kind redemptions and purchases, exchange offers, or any
other method approved by the Trustees.))
FILING OF COPIES, REFERENCES, AND HEADINGS
[Section 5]((SECTION 5)). The original or a copy of this instrument
and of each [d]((D))eclaration of [t]((T))rust supplemental hereto
shall be kept at the office of the Trust where it may be inspected by
any Shareholder. A copy of this instrument and of each supplemental
[d]((D))eclaration of [t]((T))rust shall be filed by the Trustees with
the Secretary of [t]((T))he Commonwealth of Massachusetts and the
Boston City Clerk, as well as any other governmental office where such
filing may from time to time be required. Anyone dealing with the
Trust may rely on a certificate by an officer or Trustee of the Trust
as to whether or not any such supplemental [d]((D))eclarations of
[t]((T))rust have been made and as to any matters in connection with
the Trust hereunder, and with the same effect as if it were the
original, may rely on a copy certified by an officer or Trustee of the
Trust to be a copy of this instrument or of any such supplemental
[d]((D))eclaration of [t]((T))rust. In this instrument or in any such
supplemental [d]((D))eclaration of [t]((T))rust, references to this
instrument and all expressions like "herein," "hereof" and
"hereunder," shall be deemed to refer to this instrument as amended or
affected by any such supplemental [d]((D))eclaration of [t]((T))rust.
Headings are placed herein for convenience of reference only and in
case of any conflict, the text of this instrument, rather than the
headings, shall control. This instrument may be executed in any number
of counterparts each of which shall be deemed an original.
APPLICABLE LAW
[Section 6]((SECTION 6)). The [t]((T))rust set forth in this
instrument is made in [t]The Commonwealth of Massachusetts, and it is
created under and is to be governed by and construed and administered
according to the laws of said Commonwealth. The Trust shall be of the
type commonly called a Massachusetts business trust, and without
limiting the provisions hereof, the Trust may exercise all powers
which are ordinarily exercised by such a trust((, and the absence of a
specific reference herein to any such power, privilege, or action
shall not imply that the Trust may not exercise such power or
privilege or take such actions)).
AMENDMENTS
Section 7. [If authorized by votes of] ((Except as specifically
provided herein,))the Trustees [and] ((may, without shareholder vote,
amend or otherwise supplement this Declaration of Trust by making an
amendment,)) a [Majority Shareholder Vote,] ((Declaration of Trust
supplemental hereto)) or [by] ((an amended and restated Declaration of
Trust. Shareholders shall have the right to vote (a) on)) any [larger]
((amendment that would affect their right to)) vote [which] ((granted
in Section 1 of Article VIII; (b) on any amendment that would alter
the maximum number of Trustees permitted under Section 6 of Article
IV; (c) on any amendment to this Section 7; (d) on any amendment as))
may be required by [applicable] law or [this Declaration of Trust in]
((by the Trust's registration statement filed with the Commission; and
(e) on)) any [particular case,] ((amendment submitted to them by the
Trustees. Any amendment required or permitted to be submitted to
Shareholders that, as)) the Trustees [shall amend or otherwise
supplement this instrument, by making a declaration of trust
supplemental hereto, which thereafter shall form a part hereof, except
that an amendment which] ((determine,)) shall affect the Shareholders
of one or more Series [but not the Shareholders of all outstanding
Series] ((or Classes)) shall be authorized by vote of the Shareholders
[holding a majority of the Shares entitled to vote] of each Series
((or Class)) affected and no vote [of Shareholders] of ((shareholders
of)) a Series ((or Class)) not affected shall be required. [Amendments
having the purpose of changing the name of the Trust or of supplying]
((Notwithstanding anything else herein,)) any [omission, curing any
ambiguity or curing, correcting or supplementing any defective or
inconsistent provision contained herein] ((amendment to Article XI))
shall not [require authorization by Shareholder vote. Copies of] limit
the [supplemental declaration] ((rights to indemnification or
insurance provided therein with respect to action or omission)) of
[trust shall be filed as specified in Section 5 of this Article XII.]
((Covered Persons prior to such amendment.))
FISCAL YEAR
[Section 8]((SECTION 8)). The fiscal year of the Trust shall end on a
specified date as set forth in the Bylaws, ((if any,)) provided,
however, that the Trustees may, without Shareholder approval, change
the fiscal year of the Trust.
USE OF THE WORD "FIDELITY"
[Section 9]((SECTION 9)). Fidelity Management & Research Company
("FMR") has consented to the use by any Series of the Trust of the
identifying word "Fidelity" in the name of any Series of the Trust at
some future date. Such consent is conditioned upon the employment of
FMR ((or a subsidiary or affiliate thereof)) as investment adviser of
each Series of the Trust. As between the Trust and itself, FMR
controls the use of the name of the Trust insofar as such name
contains the identifying word "Fidelity". FMR may from time to time
use the identifying word "Fidelity" in other connections and for other
purposes, including, without limitation, in the names of other
investment companies, corporations, or businesses [which] ((that)) it
may manage, advise, sponsor or own or in which it may have a financial
interest. FMR may require the Trust or any Series thereof to cease
using the identifying word "Fidelity" in the name of the Trust or any
Series thereof if the Trust or any Series thereof ceases to employ FMR
or a subsidiary or affiliate thereof as investment adviser.
PROVISIONS IN CONFLICT WITH LAW OR REGULATIONS.
((SECTION 10. (a) The provisions of this Declaration of Trust are
severable, and, if the Trustees shall determine, with the advice of
counsel, that any of such provisions is in conflict with the 1940 Act,
the regulated investment company provisions of the Internal Revenue
Code or with other applicable laws and regulations, the conflicting
provision shall be deemed never to have constituted a part of this
Declaration of Trust; provided, however, that such determination shall
not affect any of the remaining provisions of this Declaration of
Trust or render invalid or improper any action taken or omitted prior
to such determination.))
(((b) If any provision of this Declaration Trust shall be held
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall attach only to such provision in such
jurisdiction and shall not in any manner affect such provisions in any
other jurisdiction or any other provision of this Declaration of Trust
in any jurisdiction.))
[IN WITNESS WHEREOF] ((IN WITNESS WHEREOF,)) the undersigned, being
all of the [initial] Trustees of the Trust, have executed this
instrument ((as of the date set forth above.)) [this 17th day of
November, 1994.]
[SIGNATURE LINES OMITTED]
EXHIBIT 2
UNDERLINED LANGUAGE WILL BE ADDED
[BRACKETED] LANGUAGE WILL BE DELETED
((FORM OF))
MANAGEMENT CONTRACT
BETWEEN
FIDELITY CAPITAL TRUST:
(NAME OF FUND)
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
[MODIFICATION] ((AGREEMENT AMENDED and RESTATED as of_____)) [made]
this 1st day of ((_____________________)) [November 1994] ((2000 )),
by and between Fidelity Capital Trust, a Massachusetts business trust
which may issue one or more series of shares of beneficial interest
(hereinafter called the "Fund"), on behalf of (Name of Fund)
(hereinafter called the "Portfolio"), and Fidelity Management &
Research Company, a Massachusetts corporation (hereinafter called the
"Adviser") ((as set forth in its entirety below)).
Required authorization and approval by shareholders and Trustees
having been obtained, the Fund, on behalf of the Portfolio, and the
Adviser hereby consent, pursuant to Paragraph 6 of the existing
Management Contract [modified]((dated)) [December 28, 1989/December
29, 1989/September 23, 1990] ((_______)), to a modification of said
Contract in the manner set forth below. The [Modified]((Amended))
Management Contract shall, when executed by duly authorized officers
of the Fund and the Adviser, take effect on ((_____________)) [the
later of] [November 1, 1994] or the first day of the month following
approval.
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the
supervision of the Fund's Board of Trustees, direct the investments of
the Portfolio in accordance with the investment objective, policies
and limitations as provided in the Portfolio's Prospectus or other
governing instruments, as amended from time to time, the Investment
Company Act of 1940 and rules thereunder, as amended from time to time
(the "1940 Act"), and such other limitations as the Portfolio may
impose by notice in writing to the Adviser. The Adviser shall also
furnish for the use of the Portfolio office space and all necessary
office facilities, equipment and personnel for servicing the
investments of the Portfolio; and shall pay the salaries and fees of
all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all
personnel of the Fund or the Adviser performing services relating to
research, statistical and investment activities. The Adviser is
authorized, in its discretion and without prior consultation with the
Portfolio, to buy, sell, lend and otherwise trade in any stocks, bonds
and other securities and investment instruments on behalf of the
Portfolio. The investment policies and all other actions of the
Portfolio are and shall at all times be subject to the control and
direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for
the performance by its affiliates of) the management and
administrative services necessary for the operation of the Fund. The
Adviser shall, subject to the supervision of the Board of Trustees,
perform various services for the Portfolio, including but not limited
to: (i) providing the Portfolio with office space, equipment and
facilities (which may be its own) for maintaining its organization;
(ii) on behalf of the Portfolio, supervising relations with, and
monitoring the performance of, custodians, depositories, transfer and
pricing agents, accountants, attorneys, underwriters, brokers and
dealers, insurers and other persons in any capacity deemed to be
necessary or desirable; (iii) preparing all general shareholder
communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered,
maintaining the registration and qualification of the Portfolio's
shares under federal and state law; and (vii) investigating the
development of and developing and implementing, if appropriate,
management and shareholder services designed to enhance the value or
convenience of the Portfolio as an investment vehicle.
The Adviser shall also furnish such reports, evaluations, information
or analyses to the Fund as the Fund's Board of Trustees may request
from time to time or as the Adviser may deem to be desirable. The
Adviser shall make recommendations to the Fund's Board of Trustees
with respect to Fund policies, and shall carry out such policies as
are adopted by the Trustees. The Adviser shall, subject to review by
the Board of Trustees, furnish such other services as the Adviser
shall from time to time determine to be necessary or useful to perform
its obligations under this Contract.
(c) The Adviser shall place all orders for the purchase and sale of
portfolio securities for the Portfolio's account with brokers or
dealers selected by the Adviser, which may include brokers or dealers
affiliated with the Adviser. The Adviser shall use its best efforts to
seek to execute portfolio transactions at prices which are
advantageous to the Portfolio and at commission rates which are
reasonable in relation to the benefits received. In selecting brokers
or dealers qualified to execute a particular transaction, brokers or
dealers may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Portfolio and/or the other
accounts over which the Adviser or its affiliates exercise investment
discretion. The Adviser is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Adviser determines in
good faith that such amount of commission is reasonable in relation to
the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Adviser and its affiliates have with respect to accounts over which
they exercise investment discretion. The Trustees of the Fund shall
periodically review the commissions paid by the Portfolio to determine
if the commissions paid over representative periods of time were
reasonable in relation to the benefits to the Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor.
The Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of
the Fund are or may be or become interested in the Adviser as
directors, officers or otherwise and that directors, officers and
stockholders of the Adviser are or may be or become similarly
interested in the Fund, and that the Adviser may be or become
interested in the Fund as a shareholder or otherwise.
3. The Adviser will be compensated on the following basis for the
services and facilities to be furnished hereunder. The Adviser shall
receive a monthly management fee, payable monthly as soon as
practicable after the last day of each month, composed of a Basic Fee
and a Performance Adjustment. The Performance Adjustment is added to
or subtracted from the Basic Fee depending on whether the Portfolio
experienced better or worse performance than the Standard & Poor's
Composite Index of 500 Stocks (the "Index"). The Performance
Adjustment is not cumulative. An increased fee will result even though
the performance of the Portfolio over some period of time shorter than
the performance period has been behind that of the Index, and,
conversely, a reduction in the fee will be made for a month even
though the performance of the Portfolio over some period of time
shorter than the performance period has been ahead of that of the
Index. The Basic Fee and the Performance Adjustment will be computed
as follows:
(a) Basic Fee Rate: The annual Basic Fee Rate shall be the sum of
the Group Fee Rate and the Individual Fund Fee Rate calculated to the
nearest millionth decimal place as follows:
(i) Group Fee Rate. The Group Fee Rate shall be based upon the
monthly average of the net assets of the registered investment
companies having Advisory and Service or Management Contracts with the
Adviser (computed in the manner set forth in the fund's Declaration of
Trust or other organizational document) determined as of the close of
business on each business day throughout the month. The Group Fee Rate
shall be determined on a cumulative basis pursuant to the following
schedule:
Average Net Assets Annualized Fee Rate (for each
level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
[Over 390] [.2700%]
((390)) - ((426)) ((.2700))
((426)) - ((462 ((.2650))
((462)) - ((498)) ((.2600))
((498)) - ((534)) ((.2550))
((534)) - ((587)) ((.2500))
((587)) - ((646)) ((.2463))
((646)) - ((711)) ((.2426))
((711)) - ((782)) ((.2389))
((782)) - ((860)) ((.2352))
((860)) - ((946)) ((.2315))
((946)) - ((1,041)) ((.2278))
((1,041)) - ((1,145)) ((.2241))
((1,145)) - ((1,260)) ((.2204))
((Over)) ((1,260)) ((.2167))
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall
be .30%.
(b) Basic Fee. One-twelfth of the Basic Fee Rate shall be applied to
the average of the net assets of the Portfolio (computed in the manner
set forth in the Fund's Declaration of Trust or other organizational
document) determined as of the close of business on each business day
throughout the month. The resulting dollar amount comprises the Basic
Fee.
(c) Performance Adjustment Rate: The Performance Adjustment Rate is
0.02% for each percentage point (the performance of the Portfolio and
the Index each being calculated to the nearest [percentage point]
((.01%))) that the Portfolio's investment performance for the
performance period was better or worse than the record of the Index as
then constituted. The maximum performance adjustment rate is 0.20%.
The performance period will commence with the first day of the first
full month following the Portfolio's commencement of operations.
During the first eleven months of the performance period for the
Portfolio, there will be no performance adjustment. Starting with the
twelfth month of the performance period, the performance adjustment
will take effect. Following the twelfth month a new month will be
added to the performance period until the performance period equals 36
months. Thereafter the performance period will consist of the current
month plus the previous 35 months.
The Portfolio's investment performance will be measured by comparing
(i) the opening net asset value of one share of the Portfolio on the
first business day of the performance period with (ii) the closing net
asset value of one share of the Portfolio as of the last business day
of such period. In computing the investment performance of the
Portfolio and the investment record of the Index, distributions of
realized capital gains, the value of capital gains taxes per share
paid or payable on undistributed realized long-term capital gains
accumulated to the end of such period and dividends paid out of
investment income on the part of the Portfolio, and all cash
distributions of the securities included in the Index, will be treated
as reinvested in accordance with Rule 205-1 or any other applicable
rules under the Investment Advisers Act of 1940, as the same from time
to time may be amended.
(d) Performance Adjustment. One-twelfth of the annual Performance
Adjustment Rate will be applied to the average of the net assets of
the Portfolio (computed in the manner set forth in the Fund's
Declaration of Trust or other organizational document) determined as
of the close of business on each business day throughout the month and
the performance period.
(e) In case of termination of this Contract during any month, the
fee for that month shall be reduced proportionately on the basis of
the number of business days during which it is in effect for that
month. The Basic Fee Rate will be computed on the basis of and applied
to net assets averaged over that month ending on the last business day
on which this Contract is in effect. The amount of this Performance
Adjustment to the Basic Fee will be computed on the basis of and
applied to net assets averaged over the 36-month period ending on the
last business day on which this Contract is in effect provided that if
this Contract has been in effect less than 36 months, the computation
will be made on the basis of the period of time during which it has
been in effect.
4. It is understood that the Portfolio will pay all its expenses,
which expenses payable by the Portfolio shall include, without
limitation, (i) interest and taxes; (ii) brokerage commissions and
other costs in connection with the purchase or sale of securities and
other investment instruments; (iii) fees and expenses of the Fund's
Trustees other than those who are "interested persons" of the Fund or
the Adviser; (iv) legal and audit expenses; (v) custodian, registrar
and transfer agent fees and expenses; (vi) fees and expenses related
to the registration and qualification of the Fund and the Portfolio's
shares for distribution under state and federal securities laws; (vii)
expenses of printing and mailing reports and notices and proxy
material to shareholders of the Portfolio; (viii) all other expenses
incidental to holding meetings of the Portfolio's shareholders,
including proxy solicitations therefor; (ix) a pro rata share, based
on relative net assets of the Portfolio and other registered
investment companies having Advisory and Service or Management
Contracts with the Adviser, of 50% of insurance premiums for fidelity
and other coverage; (x) its proportionate share of association
membership dues; (xi) expenses of typesetting for printing
Prospectuses and Statements of Additional Information and supplements
thereto; (xii) expenses of printing and mailing Prospectuses and
Statements of Additional Information and supplements thereto sent to
existing shareholders; and (xiii) such non-recurring or extraordinary
expenses as may arise, including those relating to actions, suits or
proceedings to which the Portfolio is a party and the legal obligation
which the Portfolio may have to indemnify the Fund's Trustees and
officers with respect thereto.
5. The services of the Adviser to the Portfolio are not to be deemed
exclusive, the Adviser being free to render services to others and
engage in other activities, provided, however, that such other
services and activities do not, during the term of this Contract,
interfere, in a material manner, with the Adviser's ability to meet
all of its obligations with respect to rendering services to the
Portfolio hereunder. In the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Adviser, the Adviser shall not be subject
to liability to the Portfolio or to any shareholder of the Portfolio
for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the
purchase, holding or sale of any security ((or other investment
instrument)).
6. (a) Subject to prior termination as provided in sub-paragraph (d)
of this paragraph 6, this Contract shall continue in force until July
31, [1995]((2000)) and indefinitely thereafter, but only so long as
the continuance after such date shall be specifically approved at
least annually by vote of the Trustees of the Fund or by vote of a
majority of the outstanding voting securities of the Portfolio.
(b) This Contract may be modified by mutual consent [, such consent
on the part of the Fund to be authorized by vote of a majority of the
outstanding voting securities of the Portfolio.] ((subject to the
provisions of Section 15 of the 1940 Act, as modified by or
interpreted by any applicable order or orders of the Securities and
Exchange Commission (the "Commission") or any rules or regulations
adopted by, or interpretative releases of, the Commission.))
(c) In addition to the requirements of sub-paragraphs (a) and (b) of
this paragraph 6, the terms of any continuance or modification of this
Contract must have been approved by the vote of a majority of those
Trustees of the Fund who are not parties to the Contract or interested
persons of any such party, cast in person at a meeting called for the
purpose of voting on such approval.
(d) Either party hereto may, at any time on sixty (60) days' prior
written notice to the other, terminate this Contract, without payment
of any penalty, by action of its Trustees or Board of Directors, as
the case may be, or with respect to the Portfolio by vote of a
majority of the outstanding voting securities of the Portfolio. This
Contract shall terminate automatically in the event of its assignment.
7. The Adviser is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Fund's Declaration of Trust
or other organizational document and agrees that the obligations
assumed by the Fund pursuant to this Contract shall be limited in all
cases to the Portfolio and its assets, and the Adviser shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio or any other Portfolios of the Fund. In
addition, the Adviser shall not seek satisfaction of any such
obligations from the Trustees or any individual Trustee. The Adviser
understands that the rights and obligations of any Portfolio under the
Declaration of Trust or other organizational document are separate and
distinct from those of any and all other Portfolios.
8. This Agreement shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Massachusetts, without giving
effect to the choice of laws provisions thereof.
The terms "vote of a majority of the outstanding voting securities,"
"assignment," and "interested persons," when used herein, shall have
the respective meanings specified in the 1940 Act, as now in effect or
as hereafter amended, and subject to such orders as may be granted by
the [Securities and Exchange] Commission.
IN WITNESS WHEREOF the parties have caused this instrument to be
signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
[SIGNATURE LINES OMITTED]
EXHIBIT 3
UNDERLINED LANGUAGE WILL BE ADDED
[BRACKETED] LANGUAGE WILL BE DELETED
((FORM OF))
MANAGEMENT CONTRACT
BETWEEN
FIDELITY [COMMONWEALTH] ((CAPITAL)) TRUST:
FIDELITY SMALL CAP SELECTOR
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
[AMENDMENT] ((AGREEMENT AMENDED and RESTATED as of)) [made] this 1st
day of [October, 1999] ((______)), 2000 by and between Fidelity
[Commonwealth] ((Capital)) Trust, a Massachusetts business trust which
may issue one or more series of shares of beneficial interest
(hereinafter called the "Fund"), on behalf of Fidelity Small Cap
Selector (hereinafter called the "Portfolio"), and Fidelity Management
& Research Company, a Massachusetts corporation (hereinafter called
the "Adviser") as set forth in its entirety below.
Required authorization and approval by shareholders and Trustees
having been obtained, the Fund, on behalf of the Portfolio, and the
Adviser hereby consent, pursuant to Paragraph 6 of the existing
Management Contract dated [October 1, 1999] ((______)), to a
modification of said Contract in the manner set forth below. The
Amended Management Contract shall, when executed by duly authorized
officers of the Fund and the Adviser, take effect on [October 1, 1999]
((______ or the first day of the month following approval.))
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the
supervision of the Fund's Board of Trustees, direct the investments of
the Portfolio in accordance with the investment objective, policies
and limitations as provided in the Portfolio's Prospectus or other
governing instruments, as amended from time to time, the Investment
Company Act of 1940 and rules thereunder, as amended from time to time
(the "1940 Act"), and such other limitations as the Portfolio may
impose by notice in writing to the Adviser. The Adviser shall also
furnish for the use of the Portfolio office space and all necessary
office facilities, equipment and personnel for servicing the
investments of the Portfolio; and shall pay the salaries and fees of
all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all
personnel of the Fund or the Adviser performing services relating to
research, statistical and investment activities. The Adviser is
authorized, in its discretion and without prior consultation with the
Portfolio, to buy, sell, lend and otherwise trade in any stocks, bonds
and other securities and investment instruments on behalf of the
Portfolio. The investment policies and all other actions of the
Portfolio are and shall at all times be subject to the control and
direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for
the performance by its affiliates of) the management and
administrative services necessary for the operation of the Fund. The
Adviser shall, subject to the supervision of the Board of Trustees,
perform various services for the Portfolio, including but not limited
to: (i) providing the Portfolio with office space, equipment and
facilities (which may be its own) for maintaining its organization;
(ii) on behalf of the Portfolio, supervising relations with, and
monitoring the performance of, custodians, depositories, transfer and
pricing agents, accountants, attorneys, underwriters, brokers and
dealers, insurers and other persons in any capacity deemed to be
necessary or desirable; (iii) preparing all general shareholder
communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered,
maintaining the registration and qualification of the Portfolio's
shares under federal and state law; and (vii) investigating the
development of and developing and implementing, if appropriate,
management and shareholder services designed to enhance the value or
convenience of the Portfolio as an investment vehicle.
The Adviser shall also furnish such reports, evaluations, information
or analyses to the Fund as the Fund's Board of Trustees may request
from time to time or as the Adviser may deem to be desirable. The
Adviser shall make recommendations to the Fund's Board of Trustees
with respect to Fund policies, and shall carry out such policies as
are adopted by the Trustees. The Adviser shall, subject to review by
the Board of Trustees, furnish such other services as the Adviser
shall from time to time determine to be necessary or useful to perform
its obligations under this Contract.
(c) The Adviser shall place all orders for the purchase and sale of
portfolio securities for the Portfolio's account with brokers or
dealers selected by the Adviser, which may include brokers or dealers
affiliated with the Adviser. The Adviser shall use its best efforts to
seek to execute portfolio transactions at prices which are
advantageous to the Portfolio and at commission rates which are
reasonable in relation to the benefits received. In selecting brokers
or dealers qualified to execute a particular transaction, brokers or
dealers may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Portfolio and/or the other
accounts over which the Adviser or its affiliates exercise investment
discretion. The Adviser is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Adviser determines in
good faith that such amount of commission is reasonable in relation to
the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Adviser and its affiliates have with respect to accounts over which
they exercise investment discretion. The Trustees of the Fund shall
periodically review the commissions paid by the Portfolio to determine
if the commissions paid over representative periods of time were
reasonable in relation to the benefits to the Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor.
The Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of
the Fund are or may be or become interested in the Adviser as
directors, officers or otherwise and that directors, officers and
stockholders of the Adviser are or may be or become similarly
interested in the Fund, and that the Adviser may be or become
interested in the Fund as a shareholder or otherwise.
3. The Adviser will be compensated on the following basis for the
services and facilities to be furnished hereunder. The Adviser shall
receive a monthly management fee, payable monthly as soon as
practicable after the last day of each month, composed of a Basic Fee
and a Performance Adjustment. The Performance Adjustment is added to
or subtracted from the Basic Fee depending on whether the Portfolio
experienced better or worse performance than the Russell 2000 Index
(the "Index"). The Performance Adjustment is not cumulative. An
increased fee will result even though the performance of the Portfolio
over some period of time shorter than the performance period has been
behind that of the Index, and, conversely, a reduction in the fee will
be made for a month even though the performance of the Portfolio over
some period of time shorter than the performance period has been ahead
of that of the Index. The Basic Fee and the Performance Adjustment
will be computed as follows:
(a) Basic Fee Rate: The annual Basic Fee Rate shall be the sum of
the Group Fee Rate and the Individual Fund Fee Rate calculated to the
nearest millionth decimal place as follows:
(i) Group Fee Rate. The Group Fee Rate shall be based upon the
monthly average of the net assets of the registered investment
companies having Advisory and Service or Management Contracts with the
Adviser (computed in the manner set forth in the fund's Declaration of
Trust or other organizational document) determined as of the close of
business on each business day throughout the month. The Group Fee Rate
shall be determined on a cumulative basis pursuant to the following
schedule:
Average Net Assets Annualized Fee Rate (for each
level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
[Over 534] [.2500]
((534)) - ((587)) ((.2500))
((587)) - ((646)) ((.2463))
((646)) - ((711)) ((.2426))
((711)) - ((782)) ((.2389))
((782)) - ((860)) ((.2352))
((860)) - ((946)) ((.2315))
((946)) - ((1,041)) ((.2278))
((1,041)) - ((1,145)) ((.2241))
((1,145)) - ((1,260)) ((.2204))
((Over)) ((1,260)) ((.2167))
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall
be .35%.
(b) Basic Fee. One-twelfth of the Basic Fee Rate shall be applied to
the average of the net assets of the Portfolio (computed in the manner
set forth in the Fund's Declaration of Trust or other organizational
document) determined as of the close of business on each business day
throughout the month. The resulting dollar amount comprises the Basic
Fee.
(c) Performance Adjustment Rate: The Performance Adjustment Rate is
0.02% for each percentage point (the performance of the Portfolio and
the Index each being calculated to the nearest .01% that the
Portfolio's investment performance for the performance period was
better or worse than the record of the Index as then constituted. The
maximum performance adjustment rate is 0.20%.
The performance period will commence with the first day of the first
full month following the Portfolio's commencement of operations.
During the first eleven months of the performance period for the
Portfolio, there will be no performance adjustment. Starting with the
twelfth month of the performance period, the performance adjustment
will take effect. Following the twelfth month a new month will be
added to the performance period until the performance period equals 36
months. Thereafter the performance period will consist of the current
month plus the previous 35 months.
The Portfolio's investment performance will be measured by comparing
(i) the opening net asset value of one share of the Portfolio on the
first business day of the performance period with (ii) the closing net
asset value of one share of the Portfolio as of the last business day
of such period. In computing the investment performance of the
Portfolio and the investment record of the Index, distributions of
realized capital gains, the value of capital gains taxes per share
paid or payable on undistributed realized long-term capital gains
accumulated to the end of such period and dividends paid out of
investment income on the part of the Portfolio, and all cash
distributions of the securities included in the Index, will be treated
as reinvested in accordance with Rule 205-1 or any other applicable
rules under the Investment Advisers Act of 1940, as the same from time
to time may be amended.
(d) Performance Adjustment. One-twelfth of the annual Performance
Adjustment Rate will be applied to the average of the net assets of
the Portfolio (computed in the manner set forth in the Fund's
Declaration of Trust or other organizational document) determined as
of the close of business on each business day throughout the month and
the performance period.
(e) In case of termination of this Contract during any month, the
fee for that month shall be reduced proportionately on the basis of
the number of business days during which it is in effect for that
month. The Basic Fee Rate will be computed on the basis of and applied
to net assets averaged over that month ending on the last business day
on which this Contract is in effect. The amount of this Performance
Adjustment to the Basic Fee will be computed on the basis of and
applied to net assets averaged over the 36-month period ending on the
last business day on which this Contract is in effect provided that if
this Contract has been in effect less than 36 months, the computation
will be made on the basis of the period of time during which it has
been in effect.
4. It is understood that the Portfolio will pay all its expenses,
which expenses payable by the Portfolio shall include, without
limitation, (i) interest and taxes; (ii) brokerage commissions and
other costs in connection with the purchase or sale of securities and
other investment instruments; (iii) fees and expenses of the Fund's
Trustees other than those who are "interested persons" of the Fund or
the Adviser; (iv) legal and audit expenses; (v) custodian, registrar
and transfer agent fees and expenses; (vi) fees and expenses related
to the registration and qualification of the Fund and the Portfolio's
shares for distribution under state and federal securities laws; (vii)
expenses of printing and mailing reports and notices and proxy
material to shareholders of the Portfolio; (viii) all other expenses
incidental to holding meetings of the Portfolio's shareholders,
including proxy solicitations therefor; (ix) a pro rata share, based
on relative net assets of the Portfolio and other registered
investment companies having Advisory and Service or Management
Contracts with the Adviser, of 50% of insurance premiums for fidelity
and other coverage; (x) its proportionate share of association
membership dues; (xi) expenses of typesetting for printing
Prospectuses and Statements of Additional Information and supplements
thereto; (xii) expenses of printing and mailing Prospectuses and
Statements of Additional Information and supplements thereto sent to
existing shareholders; and (xiii) such non-recurring or extraordinary
expenses as may arise, including those relating to actions, suits or
proceedings to which the Portfolio is a party and the legal obligation
which the Portfolio may have to indemnify the Fund's Trustees and
officers with respect thereto.
5. The services of the Adviser to the Portfolio are not to be deemed
exclusive, the Adviser being free to render services to others and
engage in other activities, provided, however, that such other
services and activities do not, during the term of this Contract,
interfere, in a material manner, with the Adviser's ability to meet
all of its obligations with respect to rendering services to the
Portfolio hereunder. In the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Adviser, the Adviser shall not be subject
to liability to the Portfolio or to any shareholder of the Portfolio
for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the
purchase, holding or sale of any security or other investment
instrument.
6. (a) Subject to prior termination as provided in sub-paragraph (d)
of this paragraph 6, this Contract shall continue in force until July
31, 2000 and indefinitely thereafter, but only so long as the
continuance after such date shall be specifically approved at least
annually by vote of the Trustees of the Fund or by vote of a majority
of the outstanding voting securities of the Portfolio.
(b) This Contract may be modified by mutual consent subject to the
provisions of Section 15 of the 1940 Act, as modified by or
interpreted by any applicable order or orders of the Securities and
Exchange Commission (the "Commission") or any rules or regulations
adopted by, or interpretative releases of, the Commission.
(c) In addition to the requirements of sub-paragraphs (a) and (b) of
this paragraph 6, the terms of any continuance or modification of this
Contract must have been approved by the vote of a majority of those
Trustees of the Fund who are not parties to the Contract or interested
persons of any such party, cast in person at a meeting called for the
purpose of voting on such approval.
(d) Either party hereto may, at any time on sixty (60) days' prior
written notice to the other, terminate this Contract, without payment
of any penalty, by action of its Trustees or Board of Directors, as
the case may be, or with respect to the Portfolio by vote of a
majority of the outstanding voting securities of the Portfolio. This
Contract shall terminate automatically in the event of its assignment.
7. The Adviser is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Fund's Declaration of Trust
or other organizational document and agrees that the obligations
assumed by the Fund pursuant to this Contract shall be limited in all
cases to the Portfolio and its assets, and the Adviser shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio or any other Portfolios of the Fund. In
addition, the Adviser shall not seek satisfaction of any such
obligations from the Trustees or any individual Trustee. The Adviser
understands that the rights and obligations of any Portfolio under the
Declaration of Trust or other organizational document are separate and
distinct from those of any and all other Portfolios.
8. This Agreement shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Massachusetts, without giving
effect to the choice of laws provisions thereof.
The terms "vote of a majority of the outstanding securities,"
"assignment," and "interested persons." when used herein, shall have
the respective meanings specified in the 1940 Act, as now in effect or
as hereafter amended, and subject to such orders as may be granted by
the Commission.
IN WITNESS WHEREOF the parties have caused this instrument to be
signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
[SIGNATURE LINES OMITTED]
EXHIBIT 4
UNDERLINED LANGUAGE WILL BE ADDED
[BRACKETED] LANGUAGE WILL BE DELETED
((FORM OF))
MANAGEMENT CONTRACT
BETWEEN
FIDELITY CAPITAL TRUST:
FIDELITY TECHNOQUANT GROWTH FUND
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
[AGREEMENT]((AGREEMENT AMENDED and RESTATED as of)) [made] this
[17th] ___ day of [October 1996] ((______)), 2000 by and between
Fidelity Capital Trust, a Massachusetts business trust which may issue
one or more series of shares of beneficial interest (hereinafter
called the "Fund"), on behalf of Fidelity TechnoQuant Growth Fund
(hereinafter called the "Portfolio"), and Fidelity Management &
Research Company, a Massachusetts corporation (hereinafter called the
"Adviser") as set forth in its entirety below.
((Required authorization and approval by shareholders and Trustees
having been obtained, the Fund, on behalf of the Portfolio, and the
Adviser hereby consent, pursuant to Paragraph 6 of the existing
Management Contract dated _____________, to a modification of said
Contract in the manner set forth below. The Amended Management
Contract shall, when executed by duly authorized officers of the Fund
and the Adviser, take effect on ______________or the first day of the
month following approval.))
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the
supervision of the Fund's Board of Trustees, direct the investments of
the Portfolio in accordance with the investment objective, policies
and limitations as provided in the Portfolio's Prospectus or other
governing instruments, as amended from time to time, the Investment
Company Act of 1940 and rules thereunder, as amended from time to time
(the "1940 Act"), and such other limitations as the Portfolio may
impose by notice in writing to the Adviser. The Adviser shall also
furnish for the use of the Portfolio office space and all necessary
office facilities, equipment and personnel for servicing the
investments of the Portfolio; and shall pay the salaries and fees of
all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all
personnel of the Fund or the Adviser performing services relating to
research, statistical and investment activities. The Adviser is
authorized, in its discretion and without prior consultation with the
Portfolio, to buy, sell, lend and otherwise trade in any stocks, bonds
and other securities and investment instruments on behalf of the
Portfolio. The investment policies and all other actions of the
Portfolio are and shall at all times be subject to the control and
direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for
the performance by its affiliates of) the management and
administrative services necessary for the operation of the Fund. The
Adviser shall, subject to the supervision of the Board of Trustees,
perform various services for the Portfolio, including but not limited
to: (i) providing the Portfolio with office space, equipment and
facilities (which may be its own) for maintaining its organization;
(ii) on behalf of the Portfolio, supervising relations with, and
monitoring the performance of, custodians, depositories, transfer and
pricing agents, accountants, attorneys, underwriters, brokers and
dealers, insurers and other persons in any capacity deemed to be
necessary or desirable; (iii) preparing all general shareholder
communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered,
maintaining the registration and qualification of the Portfolio's
shares under federal and state law; and (vii) investigating the
development of and developing and implementing, if appropriate,
management and shareholder services designed to enhance the value or
convenience of the Portfolio as an investment vehicle.
The Adviser shall also furnish such reports, evaluations, information
or analyses to the Fund as the Fund's Board of Trustees may request
from time to time or as the Adviser may deem to be desirable. The
Adviser shall make recommendations to the Fund's Board of Trustees
with respect to Fund policies, and shall carry out such policies as
are adopted by the Trustees. The Adviser shall, subject to review by
the Board of Trustees, furnish such other services as the Adviser
shall from time to time determine to be necessary or useful to perform
its obligations under this Contract.
(c) The Adviser shall place all orders for the purchase and sale of
portfolio securities for the Portfolio's account with brokers or
dealers selected by the Adviser, which may include brokers or dealers
affiliated with the Adviser. The Adviser shall use its best efforts to
seek to execute portfolio transactions at prices which are
advantageous to the Portfolio and at commission rates which are
reasonable in relation to the benefits received. In selecting brokers
or dealers qualified to execute a particular transaction, brokers or
dealers may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Portfolio and/or the other
accounts over which the Adviser or its affiliates exercise investment
discretion. The Adviser is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Adviser determines in
good faith that such amount of commission is reasonable in relation to
the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Adviser and its affiliates have with respect to accounts over which
they exercise investment discretion. The Trustees of the Fund shall
periodically review the commissions paid by the Portfolio to determine
if the commissions paid over representative periods of time were
reasonable in relation to the benefits to the Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor.
The Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of
the Fund are or may be or become interested in the Adviser as
directors, officers or otherwise and that directors, officers and
stockholders of the Adviser are or may be or become similarly
interested in the Fund, and that the Adviser may be or become
interested in the Fund as a shareholder or otherwise.
3. The Adviser will be compensated on the following basis for the
services and facilities to be furnished hereunder. The Adviser shall
receive a monthly management fee, payable monthly as soon as
practicable after the last day of each month, composed of a Basic Fee
and a Performance Adjustment. The Performance Adjustment is added to
or subtracted from the Basic Fee depending on whether the Portfolio
experienced better or worse performance than the S&P 500 (the
"Index"). The Performance Adjustment is not cumulative. An increased
fee will result even though the performance of the Portfolio over some
period of time shorter than the performance period has been behind
that of the Index, and, conversely, a reduction in the fee will be
made for a month even though the performance of the Portfolio over
some period of time shorter than the performance period has been ahead
of that of the Index. The Basic Fee and the Performance Adjustment
will be computed as follows:
(a) Basic Fee Rate: The annual Basic Fee Rate shall be the sum of
the Group Fee Rate and the Individual Fund Fee Rate calculated to the
nearest millionth decimal place as follows:
(i) Group Fee Rate. The Group Fee Rate shall be based upon the
monthly average of the net assets of the registered investment
companies having Advisory and Service or Management Contracts with the
Adviser (computed in the manner set forth in the fund's Declaration of
Trust or other organizational document) determined as of the close of
business on each business day throughout the month. The Group Fee Rate
shall be determined on a cumulative basis pursuant to the following
schedule:
Average Net Assets Annualized Fee Rate (for each
level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
[Over 534] [.2500]
((534)) - ((587)) ((.2500))
((587)) - ((646)) ((.2463))
((646)) - ((711)) ((.2426))
((711)) - ((782)) ((.2389))
((782)) - ((860)) ((.2352))
((860)) - ((946)) ((.2315))
((946)) - ((1,041)) ((.2278))
((1,041)) - ((1,145)) ((.2241))
((1,145)) - ((1,260)) ((.2204))
((Over)) ((1,260)) ((.2167))
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall
be .30%.
(b) Basic Fee. One-twelfth of the Basic Fee Rate shall be applied to
the average of the net assets of the Portfolio (computed in the manner
set forth in the Fund's Declaration of Trust or other organizational
document) determined as of the close of business on each business day
throughout the month. The resulting dollar amount comprises the Basic
Fee.
(c) Performance Adjustment Rate: The Performance Adjustment Rate is
0.02% for each percentage point (the performance of the Portfolio and
the Index each being calculated to the nearest .01% that the
Portfolio's investment performance for the performance period was
better or worse than the record of the Index as then constituted. The
maximum performance adjustment rate is 0.20%.
The performance period will commence with the first day of the first
full month following the Portfolio's commencement of operations.
During the first eleven months of the performance period for the
Portfolio, there will be no performance adjustment. Starting with the
twelfth month of the performance period, the performance adjustment
will take effect. Following the twelfth month a new month will be
added to the performance period until the performance period equals 36
months. Thereafter the performance period will consist of the current
month plus the previous 35 months.
The Portfolio's investment performance will be measured by comparing
(i) the opening net asset value of one share of the Portfolio on the
first business day of the performance period with (ii) the closing net
asset value of one share of the Portfolio as of the last business day
of such period. In computing the investment performance of the
Portfolio and the investment record of the Index, distributions of
realized capital gains, the value of capital gains taxes per share
paid or payable on undistributed realized long-term capital gains
accumulated to the end of such period and dividends paid out of
investment income on the part of the Portfolio, and all cash
distributions of the securities included in the Index, will be treated
as reinvested in accordance with Rule 205-1 or any other applicable
rules under the Investment Advisers Act of 1940, as the same from time
to time may be amended.
(d) Performance Adjustment. One-twelfth of the annual Performance
Adjustment Rate will be applied to the average of the net assets of
the Portfolio (computed in the manner set forth in the Fund's
Declaration of Trust or other organizational document) determined as
of the close of business on each business day throughout the month and
the performance period.
(e) In case of termination of this Contract during any month, the
fee for that month shall be reduced proportionately on the basis of
the number of business days during which it is in effect for that
month. The Basic Fee Rate will be computed on the basis of and applied
to net assets averaged over that month ending on the last business day
on which this Contract is in effect. The amount of this Performance
Adjustment to the Basic Fee will be computed on the basis of and
applied to net assets averaged over the 36-month period ending on the
last business day on which this Contract is in effect provided that if
this Contract has been in effect less than 36 months, the computation
will be made on the basis of the period of time during which it has
been in effect.
4. It is understood that the Portfolio will pay all its expenses,
which expenses payable by the Portfolio shall include, without
limitation, (i) interest and taxes; (ii) brokerage commissions and
other costs in connection with the purchase or sale of securities and
other investment instruments; (iii) fees and expenses of the Fund's
Trustees other than those who are "interested persons" of the Fund or
the Adviser; (iv) legal and audit expenses; (v) custodian, registrar
and transfer agent fees and expenses; (vi) fees and expenses related
to the registration and qualification of the Fund and the Portfolio's
shares for distribution under state and federal securities laws; (vii)
expenses of printing and mailing reports and notices and proxy
material to shareholders of the Portfolio; (viii) all other expenses
incidental to holding meetings of the Portfolio's shareholders,
including proxy solicitations therefor; (ix) a pro rata share, based
on relative net assets of the Portfolio and other registered
investment companies having Advisory and Service or Management
Contracts with the Adviser, of 50% of insurance premiums for fidelity
and other coverage; (x) its proportionate share of association
membership dues; (xi) expenses of typesetting for printing
Prospectuses and Statements of Additional Information and supplements
thereto; (xii) expenses of printing and mailing Prospectuses and
Statements of Additional Information and supplements thereto sent to
existing shareholders; and (xiii) such non-recurring or extraordinary
expenses as may arise, including those relating to actions, suits or
proceedings to which the Portfolio is a party and the legal obligation
which the Portfolio may have to indemnify the Fund's Trustees and
officers with respect thereto.
5. The services of the Adviser to the Portfolio are not to be deemed
exclusive, the Adviser being free to render services to others and
engage in other activities, provided, however, that such other
services and activities do not, during the term of this Contract,
interfere, in a material manner, with the Adviser's ability to meet
all of its obligations with respect to rendering services to the
Portfolio hereunder. In the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Adviser, the Adviser shall not be subject
to liability to the Portfolio or to any shareholder of the Portfolio
for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the
purchase, holding or sale of any security or other investment
instrument.
6. (a) Subject to prior termination as provided in sub-paragraph (d)
of this paragraph 6, this Contract shall continue in force until July
31, [1997] ((2000)) and indefinitely thereafter, but only so long as
the continuance after such date shall be specifically approved at
least annually by vote of the Trustees of the Fund or by vote of a
majority of the outstanding voting securities of the Portfolio.
(b) This Contract may be modified by mutual consent [, such consent
on the part of the Fund to be authorized by vote of a majority of the
outstanding voting securities of the Portfolio.] ((subject to the
provisions of Section 15 of the 1940 Act, as modified by or
interpreted by any applicable order or orders of the Securities and
Exchange Commission (the "Commission") or any rules or regulations
adopted by, or interpretative releases of, the Commission.))
(c) In addition to the requirements of sub-paragraphs (a) and (b) of
this paragraph 6, the terms of any continuance or modification of this
Contract must have been approved by the vote of a majority of those
Trustees of the Fund who are not parties to the Contract or interested
persons of any such party, cast in person at a meeting called for the
purpose of voting on such approval.
(d) Either party hereto may, at any time on sixty (60) days' prior
written notice to the other, terminate this Contract, without payment
of any penalty, by action of its Trustees or Board of Directors, as
the case may be, or with respect to the Portfolio by vote of a
majority of the outstanding voting securities of the Portfolio. This
Contract shall terminate automatically in the event of its assignment.
7. The Adviser is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Fund's Declaration of Trust
or other organizational document and agrees that the obligations
assumed by the Fund pursuant to this Contract shall be limited in all
cases to the Portfolio and its assets, and the Adviser shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio or any other Portfolios of the Fund. In
addition, the Adviser shall not seek satisfaction of any such
obligations from the Trustees or any individual Trustee. The Adviser
understands that the rights and obligations of any Portfolio under the
Declaration of Trust or other organizational document are separate and
distinct from those of any and all other Portfolios.
8. This Agreement shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Massachusetts, without giving
effect to the choice of laws provisions thereof.
The terms "vote of a majority of the outstanding securities,"
"assignment," and "interested persons." when used herein, shall have
the respective meanings specified in the 1940 Act, as now in effect or
as hereafter amended, and subject to such orders as may be granted by
the [Securities and Exchange] Commission.
IN WITNESS WHEREOF the parties have caused this instrument to be
signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
[SIGNATURE LINES OMITTED]
EXHIBIT 5
UNDERLINED LANGUAGE WILL BE ADDED
[BRACKETED] LANGUAGE WILL BE DELETED
((FORM OF))
SUB-ADVISORY AGREEMENT
BETWEEN
FIDELITY MANAGEMENT & RESEARCH COMPANY
AND
FIDELITY MANAGEMENT & RESEARCH (U.K.) INC.
AND
FIDELITY CAPITAL TRUST ON BEHALF OF
(NAME OF FUND)
((AMENDMENT)) [AGREEMENT] made this [17th]1st day of ((_______))
[November, 1994/October 1996] ((2000)), by and between Fidelity
Management & Research Company, a Massachusetts corporation with
principal offices at 82 Devonshire Street, Boston, Massachusetts
(hereinafter called the "Advisor"); Fidelity Management & Research
(U.K.) Inc. (hereinafter called the "Sub-Advisor"); and Fidelity
Capital Trust, a Massachusetts business trust which may issue one or
more series of shares of beneficial interest (hereinafter called the
"Trust") on behalf of (Name of Fund) (hereinafter called the
"Portfolio").
((Required authorization and approval by shareholders and Trustees
having been obtained, the Fund, on behalf of the Portfolio, the
Adviser and the Sub-Advisor hereby consent, pursuant to Paragraph 6 of
the existing Sub-Advisory Agreement dated _____________, to a
modification of said Agreement in the manner set below. The Amended
Sub-Advisory Agreement shall, when executed by duly authorized
officers of the Fund, the Adviser and the Sub-Advisor, take effect on
________________.))
WHEREAS the Trust and the Advisor have entered into a Management
Contract on behalf of the Portfolio, pursuant to which the Advisor is
to act as investment manager of the Portfolio; and
WHEREAS the Sub-Advisor and its subsidiaries and other affiliated
persons have personnel in various locations throughout the world and
have been formed in part for the purpose of researching and compiling
information and recommendations with respect to the economies of
various countries, and securities of issuers located in such
countries, and providing investment advisory services in connection
therewith;
NOW, THEREFORE, in consideration of the premises and the mutual
promises hereinafter set forth, the Trust, the Advisor and the
Sub-Advisor agree as follows:
1. Duties: The Advisor may, in its discretion, appoint the
Sub-Advisor to perform one or more of the following services with
respect to all or a portion of the investments of the Portfolio. The
services and the portion of the investments of the Portfolio to be
advised or managed by the Sub-Advisor shall be as agreed upon from
time to time by the Advisor and the Sub-Advisor. The Sub-Advisor shall
pay the salaries and fees of all personnel of the Sub-Advisor
performing services for the Portfolio relating to research,
statistical and investment activities.
(a) INVESTMENT ADVICE: If and to the extent requested by the
Advisor, the Sub-Advisor shall provide investment advice to the
Portfolio and the Advisor with respect to all or a portion of the
investments of the Portfolio, and in connection with such advice shall
furnish the Portfolio and the Advisor such factual information,
research reports and investment recommendations as the Advisor may
reasonably require. Such information may include written and oral
reports and analyses.
(b) INVESTMENT MANAGEMENT: If and to the extent requested by the
Advisor, the Sub-Advisor shall, subject to the supervision of the
Advisor, manage all or a portion of the investments of the Portfolio
in accordance with the investment objective, policies and limitations
provided in the Portfolio's Prospectus or other governing instruments,
as amended from time to time, the Investment Company Act of 1940 (the
"1940 Act") and rules thereunder, as amended from time to time, and
such other limitations as the Trust or Advisor may impose with respect
to the Portfolio by notice to the Sub-Advisor. With respect to the
portion of the investments of the Portfolio under its management, the
Sub-Advisor is authorized to make investment decisions on behalf of
the Portfolio with regard to any stock, bond, other security or
investment instrument, and to place orders for the purchase and sale
of such securities through such broker-dealers as the Sub-Advisor may
select. The Sub-Advisor may also be authorized, but only to the extent
such duties are delegated in writing by the Advisor, to provide
additional investment management services to the Portfolio, including
but not limited to services such as managing foreign currency
investments, purchasing and selling or writing futures and options
contracts, borrowing money or lending securities on behalf of the
Portfolio. All investment management and any other activities of the
Sub-Advisor shall at all times be subject to the control and direction
of the Advisor and the Trust's Board of Trustees.
(c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or
all of the services contemplated by this Agreement directly or through
such of its subsidiaries or other affiliated persons as the
Sub-Advisor shall determine; provided, however, that performance of
such services through such subsidiaries or other affiliated persons
shall have been approved by the Trust to the extent required pursuant
to the 1940 Act and rules thereunder.
2. Information to be Provided to the Trust and the Advisor: The
Sub-Advisor shall furnish such reports, evaluations, information or
analyses to the Trust and the Advisor as the Trust's Board of Trustees
or the Advisor may reasonably request from time to time, or as the
Sub-Advisor may deem to be desirable.
3. Brokerage: In connection with the services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Sub-Advisor
shall place all orders for the purchase and sale of portfolio
securities for the Portfolio's account with brokers or dealers
selected by the Sub-Advisor, which may include brokers or dealers
affiliated with the Advisor or Sub-Advisor. The Sub-Advisor shall use
its best efforts to seek to execute portfolio transactions at prices
which are advantageous to the Portfolio and at commission rates which
are reasonable in relation to the benefits received. In selecting
brokers or dealers qualified to execute a particular transaction,
brokers or dealers may be selected who also provide brokerage and
research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of l934) to the Portfolio and/or to the other
accounts over which the Sub-Advisor or Advisor exercise investment
discretion. The Sub-Advisor is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Sub-Advisor determines
in good faith that such amount of commission is reasonable in relation
to the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Sub-Advisor has with respect to accounts over which it exercises
investment discretion. The Trustees of the Trust shall periodically
review the commissions paid by the Portfolio to determine if the
commissions paid over representative periods of time were reasonable
in relation to the benefits to the Portfolio.
4. Compensation: The Advisor shall compensate the Sub-Advisor on the
following basis for the services to be furnished hereunder.
(a) INVESTMENT ADVISORY FEE: For services provided under
subparagraph (a) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory
Fee shall be equal to 110% of the Sub-Advisor's costs incurred in
connection with rendering the services referred to in subparagraph (a)
of paragraph 1 of this Agreement. The Sub-Advisory Fee shall not be
reduced to reflect expense reimbursements or fee waivers by the
Advisor, if any, in effect from time to time.
(b) INVESTMENT MANAGEMENT FEE: For services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Investment Management Fee. The
Investment Management Fee shall be equal to: (i) 50% of the monthly
management fee rate (including performance adjustments, if any) that
the Portfolio is obligated to pay the Advisor under its Management
Contract with the Advisor, multiplied by: (ii) the fraction equal to
the net assets of the Portfolio as to which the Sub-Advisor shall have
provided investment management services divided by the net assets of
the Portfolio for that month. If in any fiscal year the aggregate
expenses of the Portfolio exceed any applicable expense limitation
imposed by any state or federal securities laws or regulations, and
the Advisor waives all or a portion of its management fee or
reimburses the Portfolio for expenses to the extent required to
satisfy such limitation, the Investment Management Fee paid to the
Sub-Advisor will be reduced by 50% of the amount of such waivers or
reimbursements multiplied by the fraction determined in (ii). If the
Sub-Advisor reduces its fees to reflect such waivers or reimbursements
and the Advisor subsequently recovers all or any portion of such
waivers or reimbursements, then the Sub-Advisor shall be entitled to
receive from the Advisor a proportionate share of the amount
recovered. To the extent that waivers and reimbursements by the
Advisor required by such limitations are in excess of the Advisor's
management fee, the Investment Management Fee paid to the Sub-Advisor
will be reduced to zero for that month, but in no event shall the
Sub-Advisor be required to reimburse the Advisor for all or a portion
of such excess reimbursements.
(c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have
provided both investment advisory services under subparagraph (a) and
investment management services under subparagraph (b) of paragraph (1)
for the same portion of the investments of the Portfolio for the same
period, the fees paid to the Sub-Advisor with respect to such
investments shall be calculated exclusively under subparagraph (b) of
this paragraph 4.
5. Expenses: It is understood that the Portfolio will pay all of its
expenses other than those expressly stated to be payable by the
Sub-Advisor hereunder or by the Advisor under the Management Contract
with the Portfolio, which expenses payable by the Portfolio shall
include, without limitation, (i) interest and taxes; (ii) brokerage
commissions and other costs in connection with the purchase or sale of
securities and other investment instruments; (iii) fees and expenses
of the Trust's Trustees other than those who are "interested persons"
of the Trust, the Sub-Advisor or the Advisor; (iv) legal and audit
expenses; (v) custodian, registrar and transfer agent fees and
expenses; (vi) fees and expenses related to the registration and
qualification of the Trust and the Portfolio's shares for distribution
under state and federal securities laws; (vii) expenses of printing
and mailing reports and notices and proxy material to shareholders of
the Portfolio; (viii) all other expenses incidental to holding
meetings of the Portfolio's shareholders, including proxy
solicitations therefore; (ix) a pro rata share, based on relative net
assets of the Portfolio and other registered investment companies
having Advisory and Service or Management Contracts with the Advisor,
of 50% of insurance premiums for fidelity and other coverage; (x) its
proportionate share of association membership dues; (xi) expenses of
typesetting for printing Prospectuses and Statements of Additional
Information and supplements thereto; (xii) expenses of printing and
mailing Prospectuses and Statements of Additional Information and
supplements thereto sent to existing shareholders; and (xiii) such
non-recurring or extraordinary expenses as may arise, including those
relating to actions, suits or proceedings to which the Portfolio is a
party and the legal obligation which the Portfolio may have to
indemnify the Trust's Trustees and officers with respect thereto.
6. Interested Persons: It is understood that Trustees, officers, and
shareholders of the Trust are or may be or become interested in the
Advisor or the Sub-Advisor as directors, officers or otherwise and
that directors, officers and stockholders of the Advisor or the
Sub-Advisor are or may be or become similarly interested in the Trust,
and that the Advisor or the Sub-Advisor may be or become interested in
the Trust as a shareholder or otherwise.
7. Services to Other Companies or Accounts: The services of the
Sub-Advisor to the Advisor are not to be deemed to be exclusive, the
Sub-Advisor being free to render services to others and engage in
other activities, provided, however, that such other services and
activities do not, during the term of this Agreement, interfere, in a
material manner, with the Sub-Advisor's ability to meet all of its
obligations hereunder. The Sub-Advisor shall for all purposes be an
independent contractor and not an agent or employee of the Advisor or
the Trust.
8. Standard of Care: In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be
subject to liability to the Advisor, the Trust or to any shareholder
of the Portfolio for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that
may be sustained in the purchase, holding or sale of any security.
9. Duration and Termination of Agreement; Amendments:
(a) Subject to prior termination as provided in subparagraph (d) of
this paragraph 9, this Agreement shall continue in force until July
31, ((2000)) [1995] and indefinitely thereafter, but only so long as
the continuance after such period shall be specifically approved at
least annually by vote of the Trust's Board of Trustees or by vote of
a majority of the outstanding voting securities of the Portfolio.
(b) This Agreement may be modified by mutual consent of the Advisor,
the Sub-Advisor and the Portfolio ((subject to the provisions of
Section 15 of the 1940 Act,as modified by or interpreted by any
applicable order or orders of the Securities and Exchange Commission
(the "Commission") or any rules or regulations adopted by, or
interpretative releases of, the Commission.))[, such consent on the
part of the Portfolio to be authorized by vote of a majority of the
outstanding voting securities of the Portfolio.]
(c) In addition to the requirements of subparagraphs (a) and (b) of
this paragraph 9, the terms of any continuance or modification of this
Agreement must have been approved by the vote of a majority of those
Trustees of the Trust who are not parties to this Agreement or
interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval.
(d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any
time on sixty (60) days' prior written notice to the other parties,
terminate this Agreement, without payment of any penalty, by action of
its Board of Trustees or Directors, or with respect to the Portfolio
by vote of a majority of its outstanding voting securities. This
Agreement shall terminate automatically in the event of its
assignment.
10. Limitation of Liability: The Sub-Advisor is hereby expressly put
on notice of the limitation of shareholder liability as set forth in
the Declaration of Trust or other organizational document of the Trust
and agrees that any obligations of the Trust or the Portfolio arising
in connection with this Agreement shall be limited in all cases to the
Portfolio and its assets, and the Sub-Advisor shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio. Nor shall the Sub-Advisor seek
satisfaction of any such obligation from the Trustees or any
individual Trustee.
11. Governing Law: This Agreement shall be governed by, and
construed in accordance with, the laws of the Commonwealth of
Massachusetts, without giving effect to the choice of laws provisions
thereof.
The terms "registered investment company," "vote of a majority of the
outstanding voting securities," "assignment," and "interested
persons," when used herein, shall have the respective meanings
specified in the 1940 Act as now in effect or as hereafter amended.
IN WITNESS WHEREOF the parties hereto have caused this instrument to
be signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
[SIGNATURE LINES OMITTED]
EXHIBIT 6
UNDERLINED LANGUAGE WILL BE ADDED
[BRACKETED] LANGUAGE WILL BE DELETED
((FORM OF))
SUB-ADVISORY AGREEMENT
BETWEEN
FIDELITY MANAGEMENT & RESEARCH COMPANY
AND
FIDELITY MANAGEMENT & RESEARCH (FAR EAST) INC.
AND
FIDELITY CAPITAL TRUST ON BEHALF OF
(NAME OF FUND)
((AMENDMENT)) [AGREEMENT] made this [1st/17th]((1st)) day of ______
[November, 1994/October, 1996] ((2000)) by and between Fidelity
Management & Research Company, a Massachusetts corporation with
principal offices at 82 Devonshire Street, Boston, Massachusetts
(hereinafter called the "Advisor"); Fidelity Management & Research
(Far East) Inc. (hereinafter called the "Sub-Advisor"); and Fidelity
Capital Trust, a Massachusetts business trust which may issue one or
more series of shares of beneficial interest (hereinafter called the
"Trust") on behalf of (Name of Fund) (hereinafter called the
"Portfolio").
((Required authorization and approval by shareholders and Trustees
having been obtained, the Fund, on behalf of the Portfolio, the
Adviser and the Sub-Advisor hereby consent, pursuant to Paragraph 6 of
the existing Sub-Advisory Agreement dated _____________, to a
modification of said Agreement in the manner set below. The Amended
Sub-Advisory Agreement shall, when executed by duly authorized
officers of the Fund, the Adviser and the Sub-Advisor, take effect on
________________.))
WHEREAS the Trust and the Advisor have entered into a Management
Contract on behalf of the Portfolio, pursuant to which the Advisor is
to act as investment manager of the Portfolio; and
WHEREAS the Sub-Advisor and its subsidiaries and other affiliated
persons have personnel in various locations throughout the world and
have been formed in part for the purpose of researching and compiling
information and recommendations with respect to the economies of
various countries, and securities of issuers located in such
countries, and providing investment advisory services in connection
therewith;
NOW, THEREFORE, in consideration of the premises and the mutual
promises hereinafter set forth, the Trust, the Advisor and the
Sub-Advisor agree as follows:
1. Duties: The Advisor may, in its discretion, appoint the
Sub-Advisor to perform one or more of the following services with
respect to all or a portion of the investments of the Portfolio. The
services and the portion of the investments of the Portfolio to be
advised or managed by the Sub-Advisor shall be as agreed upon from
time to time by the Advisor and the Sub-Advisor. The Sub-Advisor shall
pay the salaries and fees of all personnel of the Sub-Advisor
performing services for the Portfolio relating to research,
statistical and investment activities.
(a) INVESTMENT ADVICE: If and to the extent requested by the
Advisor, the Sub-Advisor shall provide investment advice to the
Portfolio and the Advisor with respect to all or a portion of the
investments of the Portfolio, and in connection with such advice shall
furnish the Portfolio and the Advisor such factual information,
research reports and investment recommendations as the Advisor may
reasonably require. Such information may include written and oral
reports and analyses.
(b) INVESTMENT MANAGEMENT: If and to the extent requested by the
Advisor, the Sub-Advisor shall, subject to the supervision of the
Advisor, manage all or a portion of the investments of the Portfolio
in accordance with the investment objective, policies and limitations
provided in the Portfolio's Prospectus or other governing instruments,
as amended from time to time, the Investment Company Act of 1940 (the
"1940 Act") and rules thereunder, as amended from time to time, and
such other limitations as the Trust or Advisor may impose with respect
to the Portfolio by notice to the Sub-Advisor. With respect to the
portion of the investments of the Portfolio under its management, the
Sub-Advisor is authorized to make investment decisions on behalf of
the Portfolio with regard to any stock, bond, other security or
investment instrument, and to place orders for the purchase and sale
of such securities through such broker-dealers as the Sub-Advisor may
select. The Sub-Advisor may also be authorized, but only to the extent
such duties are delegated in writing by the Advisor, to provide
additional investment management services to the Portfolio, including
but not limited to services such as managing foreign currency
investments, purchasing and selling or writing futures and options
contracts, borrowing money, or lending securities on behalf of the
Portfolio. All investment management and any other activities of the
Sub-Advisor shall at all times be subject to the control and direction
of the Advisor and the Trust's Board of Trustees.
(c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or
all of the services contemplated by this Agreement directly or through
such of its subsidiaries or other affiliated persons as the
Sub-Advisor shall determine; provided, however, that performance of
such services through such subsidiaries or other affiliated persons
shall have been approved by the Trust to the extent required pursuant
to the 1940 Act and rules thereunder.
2. Information to be Provided to the Trust and the Advisor: The
Sub-Advisor shall furnish such reports, evaluations, information or
analyses to the Trust and the Advisor as the Trust's Board of Trustees
or the Advisor may reasonably request from time to time, or as the
Sub-Advisor may deem to be desirable.
3. Brokerage: In connection with the services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Sub-Advisor
shall place all orders for the purchase and sale of portfolio
securities for the Portfolio's account with brokers or dealers
selected by the Sub-Advisor, which may include brokers or dealers
affiliated with the Advisor or Sub-Advisor. The Sub-Advisor shall use
its best efforts to seek to execute portfolio transactions at prices
which are advantageous to the Portfolio and at commission rates which
are reasonable in relation to the benefits received. In selecting
brokers or dealers qualified to execute a particular transaction,
brokers or dealers may be selected who also provide brokerage and
research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of l934) to the Portfolio and/or to the other
accounts over which the Sub-Advisor or Advisor exercise investment
discretion. The Sub-Advisor is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Sub-Advisor determines
in good faith that such amount of commission is reasonable in relation
to the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Sub-Advisor has with respect to accounts over which it exercises
investment discretion. The Trustees of the Trust shall periodically
review the commissions paid by the Portfolio to determine if the
commissions paid over representative periods of time were reasonable
in relation to the benefits to the Portfolio.
4. Compensation: The Advisor shall compensate the Sub-Advisor on the
following basis for the services to be furnished hereunder.
(a) INVESTMENT ADVISORY FEE: For services provided under
subparagraph (a) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory
Fee shall be equal to 105% of the Sub-Advisor's costs incurred in
connection with rendering the services referred to in subparagraph (a)
of paragraph 1 of this Agreement. The Sub-Advisory Fee shall not be
reduced to reflect expense reimbursements or fee waivers by the
Advisor, if any, in effect from time to time.
(b) INVESTMENT MANAGEMENT FEE: For services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Investment Management Fee. The
Investment Management Fee shall be equal to: (i) 50% of the monthly
management fee rate (including performance adjustments, if any) that
the Portfolio is obligated to pay the Advisor under its Management
Contract with the Advisor, multiplied by: (ii) the fraction equal to
the net assets of the Portfolio as to which the Sub-Advisor shall have
provided investment management services divided by the net assets of
the Portfolio for that month. If in any fiscal year the aggregate
expenses of the Portfolio exceed any applicable expense limitation
imposed by any state or federal securities laws or regulations, and
the Advisor waives all or a portion of its management fee or
reimburses the Portfolio for expenses to the extent required to
satisfy such limitation, the Investment Management Fee paid to the
Sub-Advisor will be reduced by 50% of the amount of such waivers or
reimbursements multiplied by the fraction determined in (ii). If the
Sub-Advisor reduces its fees to reflect such waivers or reimbursements
and the Advisor subsequently recovers all or any portion of such
waivers [or] and reimbursements, then the Sub-Advisor shall be
entitled to receive from the Advisor a proportionate share of the
amount recovered. To the extent that waivers and reimbursements by the
Advisor required by such limitations are in excess of the Advisor's
management fee, the Investment Management Fee paid to the Sub-Advisor
will be reduced to zero for that month, but in no event shall the
Sub-Advisor be required to reimburse the Advisor for all or a portion
of such excess reimbursements.
(c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have
provided both investment advisory services under subparagraph (a) and
investment management services under subparagraph (b) of paragraph 1
for the same portion of the investments of the Portfolio for the same
period, the fees paid to the Sub-Advisor with respect to such
investments shall be calculated exclusively under subparagraph (b) of
this paragraph 4.
5. Expenses: It is understood that the Portfolio will pay all of its
expenses other than those expressly stated to be payable by the
Sub-Advisor hereunder or by the Advisor under the Management Contract
with the Portfolio, which expenses payable by the Portfolio shall
include, without limitation, (i) interest and taxes; (ii) brokerage
commissions and other costs in connection with the purchase or sale of
securities and other investment instruments; (iii) fees and expenses
of the Trust's Trustees other than those who are "interested persons"
of the Trust, the Sub-Advisor or the Advisor; (iv) legal and audit
expenses; (v) custodian, registrar and transfer agent fees and
expenses; (vi) fees and expenses related to the registration and
qualification of the Trust and the Portfolio's shares for distribution
under state and federal securities laws; (vii) expenses of printing
and mailing reports and notices and proxy material to shareholders of
the Portfolio; (viii) all other expenses incidental to holding
meetings of the Portfolio's shareholders, including proxy
solicitations therefore; (ix) a pro rata share, based on relative net
assets of the Portfolio and other registered investment companies
having Advisory and Service or Management Contracts with the Advisor,
of 50% of insurance premiums for fidelity and other coverage; (x) its
proportionate share of association membership dues; (xi) expenses of
typesetting for printing Prospectuses and Statements of Additional
Information and supplements thereto; (xii) expenses of printing and
mailing Prospectuses and Statements of Additional Information and
supplements thereto sent to existing shareholders; and (xiii) such
non-recurring or extraordinary expenses as may arise, including those
relating to actions, suits or proceedings to which the Portfolio is a
party and the legal obligation which the Portfolio may have to
indemnify the Trust's Trustees and officers with respect thereto.
6. Interested Persons: It is understood that Trustees, officers, and
shareholders of the Trust are or may be or become interested in the
Advisor or the Sub-Advisor as directors, officers or otherwise and
that directors, officers and stockholders of the Advisor or the
Sub-Advisor are or may be or become similarly interested in the Trust,
and that the Advisor or the Sub-Advisor may be or become interested in
the Trust as a shareholder or otherwise.
7. Services to Other Companies or Accounts: The services of the
Sub-Advisor to the Advisor are not to be deemed to be exclusive, the
Sub-Advisor being free to render services to others and engage in
other activities, provided, however, that such other services and
activities do not, during the term of this Agreement, interfere, in a
material manner, with the Sub-Advisor's ability to meet all of its
obligations hereunder. The Sub-Advisor shall for all purposes be an
independent contractor and not an agent or employee of the Advisor or
the Trust.
8. Standard of Care: In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be
subject to liability to the Advisor, the Trust or to any shareholder
of the Portfolio for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that
may be sustained in the purchase, holding or sale of any security.
9. Duration and Termination of Agreement; Amendments:
(a) Subject to prior termination as provided in subparagraph (d) of
this paragraph 9, this Agreement shall continue in force until July
31, ((2000)) [1995] and indefinitely thereafter, but only so long as
the continuance after such period shall be specifically approved at
least annually by vote of the Trust's Board of Trustees or by vote of
a majority of the outstanding voting securities of the Portfolio.
(b) This Agreement may be modified by mutual consent of the Advisor,
the Sub-Advisor and the Portfolio ((subject to the provisions of
Section 15 of the 1940 Act, as modified by or interpreted by any
applicable order or orders of the Securities and Exchange Commission
(the "Commission") or any rules or regulations adopted by, or
interpretative releases of, the Commission.)) [such consent on the
part of the Portfolio to be authorized by vote of a majority of the
outstanding voting securities of the Portfolio.]
(c) In addition to the requirements of subparagraphs (a) and (b) of
this paragraph 9, the terms of any continuance or modification of this
Agreement must have been approved by the vote of a majority of those
Trustees of the Trust who are not parties to this Agreement or
interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval.
(d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any
time on sixty (60) days' prior written notice to the other parties,
terminate this Agreement, without payment of any penalty, by action of
its Board of Trustees or Directors, or with respect to the Portfolio
by vote of a majority of its outstanding voting securities. This
Agreement shall terminate automatically in the event of its
assignment.
10. Limitation of Liability: The Sub-Advisor is hereby expressly put
on notice of the limitation of shareholder liability as set forth in
the Declaration of Trust or other organizational document of the Trust
and agrees that any obligations of the Trust or the Portfolio arising
in connection with this Agreement shall be limited in all cases to the
Portfolio and its assets, and the Sub-Advisor shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio. Nor shall the Sub-Advisor seek
satisfaction of any such obligation from the Trustees or any
individual Trustee.
11. Governing Law: This Agreement shall be governed by, and construed
in accordance with, the laws of the Commonwealth of Massachusetts,
without giving effect to the choice of laws provisions thereof.
The terms "registered investment company," "vote of a majority of the
outstanding voting securities," "assignment," and "interested
persons," when used herein, shall have the respective meanings
specified in the 1940 Act as now in effect or as hereafter amended.
IN WITNESS WHEREOF the parties hereto have caused this instrument to
be signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
[SIGNATURE LINES OMITTED]
EXHIBIT 7
FORM OF
DISTRIBUTION AND SERVICE PLAN
FIDELITY CAPITAL TRUST: [FUND NAME]
1. This Distribution and Service Plan (the "Plan"), when effective in
accordance with its terms, shall be the written plan contemplated by
Rule 12b-1 under the Investment Company Act of 1940 (the "Act") of
[Fund Name] (the "Portfolio"), a series of shares of Fidelity Capital
Trust (the "Fund").
2. The Fund has entered into a General Distribution Agreement with
respect to the Portfolio with Fidelity Distributors Corporation (the
"Distributor"), a wholly-owned subsidiary of Fidelity Management &
Research Company (the "Adviser"), under which the Distributor uses all
reasonable efforts, consistent with its other business, to secure
purchasers for the Portfolio's shares of beneficial interest
("shares"). Under the agreement, the Distributor pays the expenses of
printing and distributing any prospectuses, reports and other
literature used by the Distributor, advertising, and other promotional
activities in connection with the offering of shares of the Portfolio
for sale to the public. It is recognized that the Adviser may use its
management fee revenues as well as past profits or its resources from
any other source, to make payment to the Distributor with respect to
any expenses incurred in connection with the distribution of Portfolio
shares, including the activities referred to above.
3. The Adviser directly, or through the Distributor, may, subject to
the approval of the Trustees, make payments to securities dealers and
other third parties who engage in the sale of shares or who render
shareholder support services, including but not limited to providing
office space, equipment and telephone facilities, answering routine
inquiries regarding the Portfolio, processing shareholder transactions
and providing such other shareholder services as the Fund may
reasonably request.
4. The Portfolio will not make separate payments as a result of this
Plan to the Adviser, Distributor or any other party, it being
recognized that the Portfolio presently pays, and will continue to
pay, a management fee to the Adviser. To the extent that any payments
made by the Portfolio to the Adviser, including payment of management
fees, should be deemed to be indirect financing of any activity
primarily intended to result in the sale of shares of the Portfolio
within the context of Rule 12b-1 under the Act, then such payments
shall be deemed to be authorized by this Plan.
5. This Plan shall become effective upon the approval by a vote of at
least a "majority of the outstanding voting securities of the
Portfolio" (as defined in the Act), the plan having been approved by a
vote of a majority of the Trustees of the Fund, including a majority
of Trustees who are not "interested persons" of the Fund (as defined
in the Act) and who have no direct or indirect financial interest in
the operation of this Plan or in any agreements related to this Plan
(the "Independent Trustees"), cast in person at a meeting called for
the purpose of voting on this Plan.
6. This Plan shall, unless terminated as hereinafter provided, remain
in effect from the date specified above until April 30, 2000 and from
year to year thereafter, provided, however, that such continuance is
subject to approval annually by a vote of a majority of the Trustees
of the Fund, including a majority of the Independent Trustees, cast in
person at a meeting called for the purpose of voting on this Plan.
This Plan may be amended at any time by the Board of Trustees,
provided that (a) any amendment to authorize direct payments by the
Portfolio to finance any activity primarily intended to result in the
sale of shares of the Portfolio, or to increase materially the amount
spent by the Portfolio for distribution, shall be effective only upon
approval by a vote of a majority of the outstanding voting securities
of the Portfolio, and (b) any material amendments of this Plan shall
be effective only upon approval in the manner provided in the first
sentence in this paragraph.
7. This Plan may be terminated at any time, without the payment of
any penalty, by vote of a majority of the Independent Trustees or by a
vote of a majority of the outstanding voting securities of the
Portfolio.
8. During the existence of this Plan, the Fund shall require the
Adviser and/or Distributor to provide the Fund, for review by the
Fund's Board of Trustees, and the Trustees shall review, at least
quarterly, a written report of the amounts expended in connection with
financing any activity primarily intended to result in the sale of
shares of the Portfolio (making estimates of such costs where
necessary or desirable) and the purposes for which such expenditures
were made.
9. This Plan does not require the Adviser or Distributor to perform
any specific type or level of distribution activities or to incur any
specific level of expenses for activities primarily intended to result
in the sale of shares of the Portfolio.
10. Consistent with the limitation of shareholder liability as set
forth in the Fund's Declaration of Trust or other organizational
document, any obligations assumed by the Portfolio pursuant to this
Plan and any agreements related to this Plan shall be limited in all
cases to the Portfolio and its assets, and shall not constitute
obligations of any other series of shares of the Fund.
11. If any provision of this Plan shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Plan
shall not be affected thereby.
EXHIBIT 8
FUNDS ADVISED BY FMR - TABLE OF AVERAGE NET ASSETS AND EXPENSE RATIOS
(A)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
INVESTMENT OBJECTIVE AND FUND FISCAL YEAR END (A) AVERAGE NET ASSETS RATIO OF NET ADVISORY FEES
(MILLIONS)(B) TO AVERAGE NET ASSETS PAID
TO FMR (C)
GROWTH
Advisor Dividend Growth: (e)(i)
Class A 11/30/99 $ 23.1 0.59%(f)
Class T 11/30/99 172.6 0.59(f)
Class B 11/30/99 145.7 0.59(f)
Class C 11/30/99 79.3 0.59(f)
Institutional Class 11/30/99 24.1 0.59(f)
Advisor Equity Growth: (i)
Class A 11/30/98 56.8 0.59
Class T 11/30/98 4,568.3 0.59
Class B 11/30/98 166.9 0.59
Class C 11/30/98 26.0 0.59
Institutional Class 11/30/98 1,004.7 0.59
Advisor Growth Opportunities:
(i)
Class A 11/30/98 255.0 0.46
Class T 11/30/98 22,748.7 0.46
Class B 11/30/98 925.6 0.46
Class C 11/30/98 146.1 0.46
Institutional Class 11/30/98 493.0 0.46
Advisor Large Cap: (i)
Class A 11/30/98 3.1 0.59
Class T 11/30/98 59.5 0.59
Class B 11/30/98 27.5 0.59
Class C 11/30/98 1.5 0.59
Institutional Class 11/30/98 7.7 0.59
Advisor Mid Cap: (i)
Class A 11/30/98 8.2 0.59
Class T 11/30/98 357.3 0.59
Class B 11/30/98 73.2 0.59
Class C 11/30/98 6.5 0.59
Institutional Class 11/30/98 35.4 0.59
Advisor Retirement Growth:
(e)(i)
Class A 11/30/99 $ 1.8 0.59%(f)
Class T 11/30/99 10.8 0.59(f)
Class B 11/30/99 6.0 0.59(f)
Class C 11/30/99 3.5 0.59(f)
Institutional Class 11/30/99 0.5 0.59(f)
Advisor Small Cap: (e)(i)
Class A 11/30/99 33.4 0.74(f)
Class T 11/30/99 231.8 0.74(f)
Class B 11/30/99 95.2 0.74(f)
Class C 11/30/99 77.2 0.74(f)
Institutional Class 11/30/99 43.0 0.74(f)
Advisor Value Strategies: (i)
Class A 11/30/98 3.5 0.38
Class T 11/30/98 491.8 0.38
Class B 11/30/98 109.5 0.38
Initial Class 11/30/98 20.2 0.38
Institutional Class 11/30/98 4.7 0.38
Advisor TechnoQuant Growth: (i)
Class A 11/30/98 3.8 0.59
Class T 11/30/98 18.3 0.59
Class B 11/30/98 11.6 0.59
Class C 11/30/98 0.3 0.59
Institutional Class 11/30/98 1.3 0.59
Aggressive Growth (i) 11/30/98 2,172.0 0.79
Growth Company (i) 11/30/98 10,377.6 0.42
New Millennium (i) 11/30/98 1,525.9 0.62
Retirement Growth (i) 11/30/98 4,376.5 0.40
Contrafund (i) 12/31/98 33,442.4 0.45
Trend (i) 12/31/98 1,354.1 0.39
Variable Insurance Products:
Growth
Initial Class 12/31/98 9,027.5 0.59
Service Class 12/31/98 50.6 0.59
Overseas (h)
Initial Class 12/31/98 $ 2,073.3 0.74%
Service Class 12/31/98 15.9 0.74
Variable Insurance Products II:
Asset Manager: Growth (i)
Initial Class 12/31/98 495.2 0.59
Service Class 12/31/98 1.1 0.59
Contrafund (i)
Initial Class 12/31/98 4,974.2 0.59
Service Class 12/31/98 61.3 0.59
Variable Insurance Products
III:
Growth Opportunities (i)
Initial Class 12/31/98 1,296.4 0.59
Service Class 12/31/98 66.4 0.59
Mid Cap (e)(i)
Initial Class 12/31/98 0.5 0.59(f)
Service Class 12/31/98 0.5 0.59(f)
Select Portfolios:
Air Transportation (i) 2/28/99 98.2 0.58
Automotive (i) 2/28/99 60.6 0.59
Biotechnology (i) 2/28/99 574.0 0.59
Brokerage and Investment 2/28/99 728.9 0.59
Management (i)
Business Services and 2/28/99 55.4 0.59
Outsourcing (i)
Chemicals (i) 2/28/99 47.2 0.59
Computers (i) 2/28/99 1,008.6 0.60
Construction and Housing (i) 2/28/99 83.1 0.59
Consumer Industries (i) 2/28/99 77.9 0.59
Cyclical Industries (i) 2/28/99 3.9 0.59
Defense and Aerospace (i) 2/28/99 53.5 0.58
Developing Communications 2/28/99 310.5 0.60
(i)
Electronics (i) 2/28/99 2,259.4 0.59
Energy (i) 2/28/99 140.5 0.59
INVESTMENT OBJECTIVE AND FUND FISCAL YEAR END (A) AVERAGE NET ASSETS RATIO OF NET ADVISORY FEES
(MILLIONS)(B) TO AVERAGE NET ASSETS PAID
TO FMR (C)
Select Portfolios: continued
Energy Service (i) 2/28/99 $ 653.1 0.59%
Environmental Services (i) 2/28/99 20.8 0.59
Financial Services (i) 2/28/99 624.8 0.59
Food and Agriculture (i) 2/28/99 227.4 0.59
Gold (i) 2/28/99 206.8 0.59
Health Care (i) 2/28/99 2,518.2 0.59
Home Finance (i) 2/28/99 1,350.2 0.58
Industrial Equipment (i) 2/28/99 42.5 0.59
Industrial Materials (i) 2/28/99 16.1 0.59
Insurance (i) 2/28/99 110.1 0.59
Leisure (i) 2/28/99 292.2 0.59
Medical Delivery (i) 2/28/99 155.5 0.59
Medical Equipment and 2/28/99 16.1 0.60(d)
Systems (e)(i)
Multimedia (i) 2/28/99 130.4 0.59
Natural Gas (i) 2/28/99 51.5 0.59
Natural Resources (i) 2/28/99 6.5 0.59
Paper and Forest Products 2/28/99 15.0 0.59
(i)
Precious Metals and 2/28/99 150.1 0.59
Minerals (i)
Regional Banks (i) 2/28/99 1,247.4 0.59
Retailing (i) 2/28/99 282.2 0.59
Software and Computer 2/28/99 572.6 0.59
Services (i)
Technology (i) 2/28/99 758.6 0.60
Telecommunications (i) 2/28/99 783.1 0.59
Transportation (i) 2/28/99 24.4 0.58
Utilities Growth (i) 2/28/99 408.1 0.59
Magellan (i) 3/31/99 75,792.2 0.43
Large Cap Stock (i) 4/30/99 286.2 0.54
Mid Cap Stock (i) 4/30/99 1,687.0 0.50
Small Cap Stock (e)(i) 4/30/99 557.9 0.73
Contrafund II (i) 6/30/99 226.3 0.59
Fidelity Fifty (i) 6/30/99 180.5 0.43
INVESTMENT OBJECTIVE AND FUND FISCAL YEAR END (A) AVERAGE NET ASSETS RATIO OF NET ADVISORY FEES
(MILLIONS)(B) TO AVERAGE NET ASSETS PAID
TO FMR (C)
Advisor Focus Funds:
Consumer Industries: (i)
Class A 7/31/99 $ 2.7 0.58%
Class T 7/31/99 17.5 0.58
Class B 7/31/99 7.5 0.58
Class C 7/31/99 1.9 0.58
Institutional Class 7/31/99 5.0 0.58
Cyclical Industries: (i)
Class A 7/31/99 0.6 0.58
Class T 7/31/99 2.8 0.58
Class B 7/31/99 1.1 0.58
Class C 7/31/99 0.5 0.58
Institutional Class 7/31/99 1.9 0.58
Financial Services: (i)
Class A 7/31/99 23.2 0.58
Class T 7/31/99 111.8 0.58
Class B 7/31/99 76.1 0.58
Class C 7/31/99 25.5 0.58
Institutional Class 7/31/99 8.0 0.58
Health Care: (i)
Class A 7/31/99 40.3 0.58
Class T 7/31/99 186.3 0.58
Class B 7/31/99 130.3 0.58
Class C 7/31/99 57.0 0.58
Institutional Class 7/31/99 20.0 0.58
Natural Resources: (i)
Class A 7/31/99 6.3 0.58
Class T 7/31/99 274.3 0.58
Class B 7/31/99 40.3 0.58
Class C 7/31/99 4.9 0.58
Institutional Class 7/31/99 4.0 0.58
Technology: (i)
Class A 7/31/99 42.1 0.58
Class T 7/31/99 192.9 0.58
Class B 7/31/99 118.4 0.58
Class C 7/31/99 34.3 0.58
Institutional Class 7/31/99 16.7 0.58
INVESTMENT OBJECTIVE AND FUND FISCAL YEAR END (A) AVERAGE NET ASSETS RATIO OF NET ADVISORY FEES
(MILLIONS)(B) TO AVERAGE NET ASSETS PAID
TO FMR (C)
Advisor Focus Funds: continued
Utilities Growth: (i)
Class A 7/31/99 $ 6.7 0.58%
Class T 7/31/99 32.9 0.58
Class B 7/31/99 29.3 0.58
Class C 7/31/99 9.2 0.58
Institutional Class 7/31/99 4.4 0.58
Blue Chip Growth (i) 7/31/99 20,095.3 0.47
Dividend Growth (i) 7/31/99 10,816.0 0.64
Low-Priced Stock (i) 7/31/99 8,273.4 0.82
OTC Portfolio (i) 7/31/99 5,575.5 0.50
Export and Multinational Fund 8/31/99 404.7 0.58
(i)
Destiny I: (i)
Class O 9/30/99 7,214.4 0.29
Class N (e) 9/30/99 0.2 0.29(d)
Destiny II: (i)
Class O 9/30/99 5,093.0 0.45
Class N (e) 9/30/99 0.5 0.45(d)
Advisor Diversified
International: (e)(g)
Class A 10/31/99 1.9 0.72
Class T 10/31/99 11.8 0.72
Class B 10/31/99 4.0 0.72
Class C 10/31/99 3.4 0.72
Institutional Class 10/31/99 1.6 0.72
Advisor Europe Capital
Appreciation: (e)(g)
Class A 10/31/99 1.5 0.72
Class T 10/31/99 8.4 0.72
Class B 10/31/99 2.5 0.72
Class C 10/31/99 2.6 0.72
Institutional Class 10/31/99 0.7 0.72
Advisor Emerging Asia: (e)(g)
Class A 10/31/99 $ 82.3 1.07%
Class T 10/31/99 0.7 1.07
Class B 10/31/99 0.4 1.07
Class C 10/31/99 0.3 1.07
Institutional Class 10/31/99 0.1 1.07
Advisor Global Equity: (e)(g)
Class A 10/31/99 1.4 0.73
Class T 10/31/99 2.2 0.73
Class B 10/31/99 1.5 0.73
Class C 10/31/99 1.7 0.73
Institutional Class 10/31/99 1.1 0.73
Advisor International Capital
Appreciation: (e)(g)
Class A 10/31/99 1.6 0.73
Class T 10/31/99 21.1 0.73
Class B 10/31/99 6.0 0.73
Class C 10/31/99 3.7 0.73
Institutional Class 10/31/99 5.9 0.73
Advisor Japan: (e)(g)
Class A 10/31/99 2.3 0.72
Class T 10/31/99 8.4 0.72
Class B 10/31/99 5.7 0.72
Class C 10/31/99 6.4 0.72
Institutional Class 10/31/99 1.3 0.72
Advisor Latin America: (e)(g)
Class A 10/31/99 0.6 0.73
Class T 10/31/99 0.8 0.73
Class B 10/31/99 0.7 0.73
Class C 10/31/99 0.6 0.73
Institutional Class 10/31/99 0.4 0.73
Advisor Overseas: (h)
Class A 10/31/99 $ 16.5 0.90%
Class T 10/31/99 1,212.8 0.90
Class B 10/31/99 70.9 0.90
Class C 10/31/99 22.3 0.90
Institutional Class 10/31/99 81.3 0.90
Canada (h) 10/31/99 45.3 0.32
Capital Appreciation (i) 10/31/99 2,734.2 0.43
Disciplined Equity (i) 10/31/99 3,168.8 0.42
Diversified International (h) 10/31/99 2,607.3 0.83
Emerging Markets (h) 10/31/99 343.0 0.73
Europe (h) 10/31/99 1,467.1 0.60
Europe Capital Appreciation 10/31/99 568.9 0.66
(h)
France (h) 10/31/99 12.8 0.00(z)
Germany (h) 10/31/99 24.6 0.74
Hong Kong and China (g) 10/31/99 148.8 0.73
International Value (g) 10/31/99 441.9 0.83
Japan (g) 10/31/99 450.4 0.86
Japan Small Companies (g) 10/31/99 668.5 0.72
Latin America (h) 10/31/99 329.7 0.73
Nordic (h) 10/31/99 104.8 0.73
Overseas (h) 10/31/99 3,964.2 0.92
Pacific Basin (g) 10/31/99 352.2 0.92
Small Cap Selector (i) 10/31/99 582.3 0.42
Southeast Asia (g) 10/31/99 300.1 0.89
Stock Selector (i) 10/31/99 1,676.3 0.38
TechnoQuant Growth 10/31/99 50.6 0.33
United Kingdom (h) 10/31/99 6.7 0.00(z)
Value (i) 10/31/99 5,311.3 0.32
Worldwide (h) 10/31/99 962.4 0.73
</TABLE>
(a) All fund data are as of the fiscal year end noted in the chart or
as of October 31, 1999, if fiscal year end figures are not yet
available.
(b) Average net assets are computed on the basis of average net assets
of each fund or class at the close of business on each business day
throughout its fiscal period.
(c) Reflects reductions for any expense reimbursement paid by or due
from FMR pursuant to voluntary or state expense limitations. Funds so
affected are indicated by an (z). The ratio for certain multi-class
funds is presented gross of expense reductions for presentation
purposes.
(d) Annualized
(e) Less than a complete fiscal year
(f) Based on estimated expenses for the first year
(g) Fidelity Management & Research Company (FMR) has entered into
sub-advisory agreements with the following affiliates: Fidelity
Management & Research (U.K.) Inc. (FMR U.K.), Fidelity Management &
Research (Far East) Inc. (FMR Far East), Fidelity Investments Japan
Ltd. (FIJ), Fidelity International Investment Advisors (FIIA), and
Fidelity International Investment Advisors (U.K.) Limited (FIIA (U.K.)
L), with respect to the fund.
(h) FMR has entered into sub-advisory agreements with the following
affiliates: FMR U.K., FMR Far East, FIIA, and FIIA (U.K.) L, with
respect to the fund.
(i) FMR has entered into sub-advisory agreements with FMR U.K. and FMR
Far East, with respect to the fund.
CAP-pxs-0100 CUSIP# 316066109/FUND# 307
1.730460.101 CUSIP# 316066208/FUND# 315
CUSIP# 316066307/FUND# 320
CUSIP# 316066406/FUND# 333
CUSIP# 316464106/FUND# 039
CUSIP# 315912303/FUND# 336
Vote this proxy card TODAY! Your prompt response will
save Fidelity Capital Appreciation Fund 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 CAPITAL TRUST: FIDELITY CAPITAL APPRECIATION FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward
C. Johnson 3d, Eric D. Roiter and Marvin L. Mann, or any one or more
of them, attorneys, with full power of substitution, to vote all
shares of Fidelity Capital Trust: Fidelity Capital Appreciation Fund
as indicated above which the undersigned is entitled to vote at the
Special Meeting of Shareholders of the fund to be held at an office of
the trust at 27 State Street, 10th Floor, Boston, MA 02109, on March
15, 2000 at 1 0 :00 a.m. 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___________________________________
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
fund# 307, 315, 336, 320, 333, 039 HH
Please refer to the Proxy Statement discussion of each of these
matters.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE
PROPOSALS.
As to any other matter, said attorneys shall vote in accordance with
their best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR EACH OF THE FOLLOWING:
- ----------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees [ ]FOR all nominees listed [ ] WITHHOLD authority to 1.
specified below as Trustees: (except as marked to the vote for all nominees.
(1) Phyllis Burke Davis, (2) contrary below).
Ralph F. Cox, (3) Robert M.
Gates, (4) Edward C. Johnson
3d, (5) Donald J. Kirk, (6)
Ned C. Lautenbach, (7) Peter
S. Lynch, (8) William O.
McCoy, (9) Gerald C.
McDonough, (10) Marvin L.
Mann, (11) Robert C. Pozen,
(12) Thomas R. Williams.
(INSTRUCTION: TO WITHHOLD
AUTHORITY TO VOTE FOR ANY
INDIVIDUAL NOMINEE(S), WRITE
THE NAME(S) OF THE
NOMINEE(S) ON THE LINE
BELOW.)
</TABLE>
______________________________________________________________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
PricewaterhouseCoopers LLP
as independent accountants
of the fund.
3. To authorize the Trustees to FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
adopt an amended and
restated Declaration of
Trust.
4. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
management contract for the
fund.
7. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 7.
sub-advisory agreement with
FMR U.K. for the fund.
8. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 8.
sub-advisory agreement with
FMR Far East for the fund.
9. To approve a Distribution and FOR [ ] AGAINST [ ] ABSTAIN [ ] 9.
Service Plan pursuant to
Rule 12b-1 for the fund.
10. To eliminate certain FOR [ ] AGAINST [ ] ABSTAIN [ ] 10.
fundamental investment
policies of the fund.
13. To amend the fundamental FOR [ ] AGAINST [ ] ABSTAIN [ ] 13.
investment limitation
concerning diversification
to exclude "securities of
other investment companies"
from the limitation for the
fund.
14. To amend the fund's FOR [ ] AGAINST [ ] ABSTAIN [ ] 14.
fundamental investment
limitation concerning
concentration.
</TABLE>
CAF/FDE/SCS/FSS/TQG/VAL-PXC- 0100
CAF CUSIP# 316066109, fund# 307 HH
FDE CUSIP# 316066208, fund# 315 HH
SCS CUSIP# 315912303, fund# 336 HH
FSS CUSIP# 316066307, fund# 320 HH
TQG CUSIP# 316066406, fund# 333 HH
VAL CUSIP# 316464106, fund# 039 HH
Vote this proxy card TODAY! Your prompt response will
save Fidelity Disciplined Equity Fund 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 CAPITAL TRUST: FIDELITY DISCIPLINED EQUITY FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward
C. Johnson 3d, Eric D. Roiter and Marvin L. Mann, or any one or more
of them, attorneys, with full power of substitution, to vote all
shares of Fidelity Capital Trust: Fidelity Disciplined Equity Fund as
indicated above which the undersigned is entitled to vote at the
Special Meeting of Shareholders of the fund to be held at an office of
the trust at 27 State Street, 10th Floor, Boston, MA 02109, on March
15, 2000 at 1 0 :00 a.m. 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 __________________________________,
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
fund# 307, 315, 336, 320, 333, 039 HH
Please refer to the Proxy Statement discussion of each of these
matters.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE
PROPOSALS.
As to any other matter, said attorneys shall vote in accordance with
their best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR EACH OF THE FOLLOWING:
- ----------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees [ ]FOR all nominees listed [ ] WITHHOLD authority to 1.
specified below as Trustees: (except as marked to the vote for all nominees.
(1) Phyllis Burke Davis, (2) contrary below).
Ralph F. Cox, (3) Robert M.
Gates, (4) Edward C. Johnson
3d, (5) Donald J. Kirk, (6)
Ned C. Lautenbach, (7) Peter
S. Lynch, (8) William O.
McCoy, (9) Gerald C.
McDonough, (10) Marvin L.
Mann, (11) Robert C. Pozen,
(12) Thomas R. Williams.
(INSTRUCTION: TO WITHHOLD
AUTHORITY TO VOTE FOR ANY
INDIVIDUAL NOMINEE(S), WRITE
THE NAME(S) OF THE
NOMINEE(S) ON THE LINE
BELOW.)
</TABLE>
______________________________________________________________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
PricewaterhouseCoopers LLP
as independent accountants
of the fund.
3. To authorize the Trustees to FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
adopt an amended and
restated Declaration of
Trust.
4. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
management contract for the
fund.
7. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 7.
sub-advisory agreement with
FMR U.K. for the fund.
8. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 8.
sub-advisory agreement with
FMR Far East for the fund.
11. To eliminate a fundamental FOR [ ] AGAINST [ ] ABSTAIN [ ] 11.
investment policy of the fund.
13. To amend the fundamental FOR [ ] AGAINST [ ] ABSTAIN [ ] 13.
investment limitation
concerning diversification
to exclude "securities of
other investment companies"
from the limitation for the
fund.
</TABLE>
CAF/FDE/SCS/FSS/TQG/VAL-PXC- 0100
CAF CUSIP# 316066109, fund# 307 HH
FDE CUSIP# 316066208, fund# 315 HH
SCS CUSIP# 315912303, fund# 336 HH
FSS CUSIP# 316066307, fund# 320 HH
TQG CUSIP# 316066406, fund# 333 HH
VAL CUSIP# 316464106, fund# 039 HH
Vote this proxy card TODAY! Your prompt response will
save Fidelity Small Cap Selector 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 CAPITAL TRUST: FIDELITY SMALL CAP SELECTOR
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward
C. Johnson 3d, Eric D. Roiter and Marvin L. Mann, or any one or more
of them, attorneys, with full power of substitution, to vote all
shares of Fidelity Capital Trust: Fidelity Small Cap Selector as
indicated above which the undersigned is entitled to vote at the
Special Meeting of Shareholders of the fund to be held at an office of
the trust at 27 State St., 10th Floor, Boston, MA 02109, on March 15,
2000 at 1 0 :00 a.m. 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 __________________________________,
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
fund# 307, 315, 336, 320, 333, 039 HH
Please refer to the Proxy Statement discussion of each of these
matters.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE
PROPOSALS.
As to any other matter, said attorneys shall vote in accordance with
their best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR EACH OF THE FOLLOWING:
- ----------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees [ ]FOR all nominees listed [ ] WITHHOLD authority to 1.
specified below as Trustees: (except as marked to the vote for all nominees.
(1) Phyllis Burke Davis, contrary below).
(2) Ralph F. Cox, (3) Robert
M. Gates, (4) Edward C.
Johnson 3d, (5) Donald J.
Kirk, (6) Ned C. Lautenbach,
(7) Peter S. Lynch, (8)
William O. McCoy, (9) Gerald
C. McDonough, (10) Marvin L.
Mann, (11) Robert C. Pozen,
(12) Thomas R. Williams.
(INSTRUCTION: TO WITHHOLD
AUTHORITY TO VOTE FOR ANY
INDIVIDUAL NOMINEE(S), WRITE
THE NAME(S) OF THE
NOMINEE(S) ON THE LINE
BELOW.)
</TABLE>
______________________________________________________________________
2. To ratify the selection of FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
Deloitte & Touche LLP as
independent accountants of
the fund.
3. To authorize the Trustees to FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
adopt an amended and
restated Declaration of
Trust.
5. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
management contract for the
fund.
CAF/FDE/SCS/FSS/TQG/VAL-PXC-0100
CAF CUSIP# 316066109, fund# 307 HH
FDE CUSIP# 316066208, fund# 315 HH
SCS CUSIP# 315912303, fund# 336 HH
FSS CUSIP# 316066307, fund# 320 HH
TQG CUSIP# 316066406, fund# 333 HH
VAL CUSIP# 316464106, fund# 039 HH
Vote this proxy card TODAY! Your prompt response will
save Fidelity Stock Selector 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 CAPITAL TRUST: FIDELITY STOCK SELECTOR
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward
C. Johnson 3d, Eric D. Roiter and Marvin L. Mann, or any one or more
of them, attorneys, with full power of substitution, to vote all
shares of Fidelity Capital Trust: Fidelity Stock Selector as
indicated above which the undersigned is entitled to vote at the
Special Meeting of Shareholders of the fund to be held at an office of
the trust at 27 State St., 10th Floor, Boston, MA 02109, on March 15,
2000 at 1 0 :00 a.m. 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 __________________________________,
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
fund# 307, 315, 336, 320, 333, 039 HH
Please refer to the Proxy Statement discussion of each of these
matters.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE
PROPOSALS.
As to any other matter, said attorneys shall vote in accordance with
their best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR EACH OF THE FOLLOWING:
- ----------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees [ ]FOR all nominees listed [ ] WITHHOLD authority to 1.
specified below as Trustees: (except as marked to the vote for all nominees.
(1) Phyllis Burke Davis, contrary below).
(2) Ralph F. Cox, (3) Robert
M. Gates, (4) Edward C.
Johnson 3d, (5) Donald J.
Kirk, (6) Ned C. Lautenbach,
(7) Peter S. Lynch, (8)
William O. McCoy, (9) Gerald
C. McDonough, (10) Marvin L.
Mann, (11) Robert C. Pozen,
(12) Thomas R. Williams.
(INSTRUCTION: TO WITHHOLD
AUTHORITY TO VOTE FOR ANY
INDIVIDUAL NOMINEE(S), WRITE
THE NAME(S) OF THE
NOMINEE(S) ON THE LINE
BELOW.)
</TABLE>
______________________________________________________________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To elect Deloitte & Touche FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
LLP as independent
accountants of the fund.
3. To authorize the Trustees to FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
adopt an amended and
restated Declaration of
Trust.
4. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
management contract for the
fund.
7. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 7.
sub-advisory agreement with
FMR U.K. for the fund.
8. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 8.
sub-advisory agreement with
FMR Far East for the fund.
12. To eliminate a fundamental FOR [ ] AGAINST [ ] ABSTAIN [ ] 12.
investment policy of the fund.
13. To amend the fundamental FOR [ ] AGAINST [ ] ABSTAIN [ ] 13.
investment limitation
concerning diversification
to exclude "securities of
other investment companies"
from the limitation for the
fund.
</TABLE>
CAF/FDE/SCS/FSS/TQG/VAL-PXC-0100
CAF CUSIP# 316066109, fund# 307 HH
FDE CUSIP# 316066208, fund# 315 HH
SCS CUSIP# 315912303, fund# 336 HH
FSS CUSIP# 316066307, fund# 320 HH
TQG CUSIP# 316066406, fund# 333 HH
VAL CUSIP# 316464106, fund# 039 HH
Vote this proxy card TODAY! Your prompt response will
save Fidelity TechnoQuant Growth Fund 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 CAPITAL TRUST: FIDELITY TECHNOQUANT GROWTH FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward
C. Johnson 3d, Eric D. Roiter and Marvin L. Mann, or any one or more
of them, attorneys, with full power of substitution, to vote all
shares of Fidelity Capital Trust: Fidelity TechnoQuant Growth Fund as
indicated above which the undersigned is entitled to vote at the
Special Meeting of Shareholders of the fund to be held at an office of
the trust at 27 State Street, 10th Floor, Boston, MA 02109, on March
15, 2000 at 1 0 :00 a.m. 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___________________________________,
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
fund# 307, 315, 336, 320, 333, 039 HH
Please refer to the Proxy Statement discussion of each of these
matters.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE
PROPOSALS.
As to any other matter, said attorneys shall vote in accordance with
their best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR EACH OF THE FOLLOWING:
- ----------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees [ ]FOR all nominees listed [ ] WITHHOLD authority to 1.
specified below as Trustees: (except as marked to the vote for all nominees.
(1) Phyllis Burke Davis, contrary below).
(2) Ralph F. Cox, (3) Robert
M. Gates, (4) Edward C.
Johnson 3d, (5) Donald J.
Kirk, (6) Ned C. Lautenbach,
(7) Peter S. Lynch, (8)
William O. McCoy, (9) Gerald
C. McDonough, (10) Marvin L.
Mann, (11) Robert C. Pozen,
(12) Thomas R. Williams.
(INSTRUCTION: TO WITHHOLD
AUTHORITY TO VOTE FOR ANY
INDIVIDUAL NOMINEE(S), WRITE
THE NAME(S) OF THE
NOMINEE(S) ON THE LINE
BELOW.)
</TABLE>
______________________________________________________________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
PricewaterhouseCoopers LLP
as independent accountants
of the fund.
3. To authorize the Trustees to FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
adopt an amended and
restated Declaration of
Trust.
6. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 6.
management contract for the
fund.
7. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 7.
sub-advisory agreement with
FMR U.K. for the fund.
8. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 8.
sub-advisory agreement with
FMR Far East for the fund.
9. To approve a Distribution and FOR [ ] AGAINST [ ] ABSTAIN [ ] 9.
Service Plan pursuant to
Rule 12b-1 for the fund.
</TABLE>
CAF/FDE/SCS/FSS/TQG/VAL-PXC-0100
CAF CUSIP# 316066109, fund# 307 HH
FDE CUSIP# 316066208, fund# 315 HH
SCS CUSIP# 315912303, fund# 336 HH
FSS CUSIP# 316066307, fund# 320 HH
TQG CUSIP# 316066406, fund# 333 HH
VAL CUSIP# 316464106, fund# 039 HH
Vote this proxy card TODAY! Your prompt response will
save Fidelity Value Fund 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 CAPITAL TRUST: FIDELITY VALUE FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward
C. Johnson 3d, Eric D. Roiter and Marvin L. Mann, or any one or more
of them, attorneys, with full power of substitution, to vote all
shares of Fidelity Capital Trust: Fidelity Value Fund as indicated
above which the undersigned is entitled to vote at the Special Meeting
of Shareholders of the fund to be held at an office of the trust at 27
State Street, 10th Floor, Boston, MA 02109, on March 15, 2000 at
1 0 :00 a.m. 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 _________________________________,
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
fund# 307, 315, 336, 320, 333, 039 HH
Please refer to the Proxy Statement discussion of each of these
matters.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE
PROPOSALS.
As to any other matter, said attorneys shall vote in accordance with
their best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR EACH OF THE FOLLOWING:
- ----------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees [ ]FOR all nominees listed [ ] WITHHOLD authority to 1.
specified below as Trustees: (except as marked to the vote for all nominees.
(1) Phyllis Burke Davis, contrary below).
(2) Ralph F. Cox, (3) Robert
M. Gates, (4) Edward C.
Johnson 3d, (5) Donald J.
Kirk, (6) Ned C. Lautenbach,
(7) Peter S. Lynch, (8)
William O. McCoy, (9) Gerald
C. McDonough, (10) Marvin L.
Mann, (11) Robert C. Pozen,
(12) Thomas R. Williams.
(INSTRUCTION: TO WITHHOLD
AUTHORITY TO VOTE FOR ANY
INDIVIDUAL NOMINEE(S), WRITE
THE NAME(S) OF THE
NOMINEE(S) ON THE LINE
BELOW.)
</TABLE>
______________________________________________________________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
PricewaterhouseCoopers LLP
as independent accountants
of the fund.
3. To authorize the Trustees to FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
adopt an amended and
restated Declaration of
Trust.
4. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
management contract for the
fund.
7. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 7.
sub-advisory agreement with
FMR U.K. for the fund.
8. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 8.
sub-advisory agreement with
FMR Far East for the fund.
13. To amend the fundamental FOR [ ] AGAINST [ ] ABSTAIN [ ] 13.
investment limitation
concerning diversification
to exclude "securities of
other investment companies"
from the lmitation for the
fund.
15. To amend the fund's FOR [ ] AGAINST [ ] ABSTAIN [ ] 15.
fundamental investment
limitation concerning
underwriting.
</TABLE>
CAF/FDE/SCS/FSS/TQG/VAL-PXC-0100
CAF CUSIP# 316066109, fund# 307 HH
FDE CUSIP# 316066208, fund# 315 HH
SCS CUSIP# 315912303, fund# 336 HH
FSS CUSIP# 316066307, fund# 320 HH
TQG CUSIP# 316066406, fund# 333 HH
VAL CUSIP# 316464106, fund# 039 HH
IMPORTANT PROXY MATERIALS
PLEASE CAST YOUR VOTE NOW!
FIDELITY(Registered trademark) CAPITAL APPRECIATION FUND
FIDELITY DISCIPLINED EQUITY FUND
FIDELITY SMALL CAP SELECTOR
FIDELITY STOCK SELECTOR
FIDELITY TECHNOQUANT(Registered trademark) GROWTH FUND
FIDELITY VALUE FUND
Dear Shareholder:
I am writing to let you know that a special meeting of shareholders of
the Fidelity funds mentioned above will be held on March 15, 2000. The
purpose of the meeting is to vote on several important proposals that
affect the funds and your investment in them. As a shareholder, you
have the opportunity to voice your opinion on the matters that affect
your fund(s). This package contains information about the proposals
and the materials to use when voting by mail.
Please read the enclosed materials and cast your vote on the proxy
card(s). PLEASE VOTE AND RETURN YOUR CARD(S) PROMPTLY. YOUR VOTE IS
EXTREMELY IMPORTANT, NO MATTER HOW LARGE OR SMALL YOUR HOLDINGS MAY
BE.
All of the proposals have been carefully reviewed by the Board of
Trustees. The Trustees, most of whom are not affiliated with Fidelity,
are responsible for protecting your interests as a shareholder. The
Trustees believe these proposals are in the best interest of
shareholders. They recommend that you vote FOR each proposal.
The following Q&A is provided to assist you in understanding the
proposals. Each of the proposals is described in greater detail in the
enclosed proxy statement.
VOTING IS QUICK AND EASY. EVERYTHING YOU NEED IS ENCLOSED. To cast
your vote, simply complete the proxy card(s) enclosed in this package.
Be sure to sign the card(s) before mailing it in the postage-paid
envelope.
If you have any questions before you vote, please call Fidelity at
1-800-544-6666. We'll be glad to help you get your vote in quickly.
Thank you for your participation in this important initiative.
Sincerely,
/s/ Edward C. Johnson 3d
Edward C. Johnson 3d
Chairman and Chief Executive Officer
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 proposals to be voted upon. Your vote is
important. We appreciate you placing your trust in Fidelity and look
forward to helping you achieve your financial goals.
ON WHAT PROPOSALS AM I ENCOURAGED TO VOTE?
You may be asked to vote on the following proposals:
1. To elect a Board of Trustees.
2. To elect or ratify the selection of Deloitte & Touche LLP or
PricewaterhouseCoopers LLP as independent accountants of the funds.
3. To authorize the Trustees to adopt an amended and restated
Declaration of Trust.
4. To approve an amended management contract for each of Fidelity
Capital Appreciation Fund, Fidelity Disciplined Equity Fund, Fidelity
Stock Selector and Fidelity Value Fund.
5. To approve an amended management contract for Fidelity Small Cap
Selector.
6. To approve an amended management contract for Fidelity TechnoQuant
Growth Fund.
7. To approve an amended sub-advisory agreement with Fidelity
Management & Research (U.K.) Inc. for each of Fidelity Capital
Appreciation Fund, Fidelity Disciplined Equity Fund, Fidelity Stock
Selector, Fidelity TechnoQuant Growth Fund and Fidelity Value Fund.
8. To approve an amended sub-advisory agreement with Fidelity
Management & Research (Far East) Inc. for each of Fidelity Capital
Appreciation Fund, Fidelity Disciplined Equity Fund, Fidelity Stock
Selector, Fidelity TechnoQuant Growth Fund and Fidelity Value Fund.
9. To approve a Distribution and Service Plan pursuant to Rule 12b-1
for each of Fidelity Capital Appreciation Fund and Fidelity
TechnoQuant Growth Fund.
10. To eliminate certain fundamental investment policies of Fidelity
Capital Appreciation Fund.
11. To eliminate a fundamental investment policy of Fidelity
Disciplined Equity Fund.
12. To eliminate a fundamental investment policy of Fidelity Stock
Selector.
13. To amend the fundamental investment limitation concerning
diversification to exclude securities of other investment companies
from the limitation for each of Fidelity Capital Appreciation Fund,
Fidelity Disciplined Equity Fund, Fidelity Stock Selector, and
Fidelity Value Fund.
14. To amend Fidelity Capital Appreciation Fund's fundamental
investment limitation concerning concentration.
15. To amend Fidelity Value Fund's fundamental investment limitation
concerning underwriting.
WHAT ROLE DOES THE BOARD PLAY? (PROPOSAL 1)
The Trustees oversee the investment policies of each fund. Members of
the Board are fiduciaries and have an obligation to serve the best
interests of shareholders, including approving policy changes such as
those proposed in the proxy statement. In addition, the Trustees
review fund performance, oversee fund activities, and review
contractual arrangements with companies that provide services to the
funds.
WHAT IS THE ROLE OF THE INDEPENDENT ACCOUNTANTS? (PROPOSAL 2)
The independent accountants examine annual financial statements for
the funds and provide other audit and tax-related services. They also
sign or certify any financial statements of the funds that are
required by law to be independently certified and filed with the
Securities and Exchange Commission (SEC).
WHY ARE THE FUNDS PROPOSING TO ADOPT AN AMENDED AND RESTATED
DECLARATION OF TRUST? (PROPOSAL 3)
The new Declaration of Trust is a more modern form of trust instrument
for a Massachusetts business trust. It gives the Trustees more
flexibility, and, subject to the applicable requirements of federal
and state law, broader authority to act. This increased flexibility
may allow the Trustees to react more quickly to changes in competitive
and regulatory conditions.
Adoption of the new Declaration of Trust will not alter the Trustees'
existing fiduciary obligations to act in the best interests of the
funds' shareholders. Before utilizing any new flexibility that the new
Declaration of Trust may afford, the Trustees must first consider the
shareholders' interests and act in accordance with such interests. The
new Declaration of Trust amends the current Declaration of Trust in a
number of significant ways. Please review the proxy statement for
specific details.
WHY ARE FIDELITY CAPITAL APPRECIATION FUND, FIDELITY DISCIPLINED
EQUITY FUND, FIDELITY STOCK SELECTOR, AND FIDELITY VALUE FUND
PROPOSING AMENDED MANAGEMENT CONTRACTS? (PROPOSAL 4)
The amended management contracts provide for lower management fees to
be paid to Fidelity Management & Research Company (FMR) when FMR's
assets under management exceed certain levels. Each fund's amended
management contract also allows FMR and the trust, on behalf of the
fund, to modify the fund's management contract subject to the
requirements of the Investment Company Act of 1940 (1940 Act).
In addition, each fund's amended management contract revises the
fund's performance adjustment calculation by rounding the investment
performance of both the fund and its comparative index to the nearest
0.01%, rather than the nearest 1.00%. This reduces the chance of minor
changes in performance resulting in significant changes to the
performance adjustment, and ultimately the fund's management fee.
The proposed change to each fund's performance adjustment calculation
may either increase or decrease its management fee, depending on the
performance of the fund and the relative performance of its
comparative index. Please refer to the proxy statement for specific
details of the amended management contract proposal.
WHY IS FIDELITY SMALL CAP SELECTOR PROPOSING AN AMENDED MANAGEMENT
CONTRACT? (PROPOSAL 5)
The amended management contract provides for lower management fees to
be paid to FMR when FMR's assets under management exceed certain
levels. The amended management contract will result in management fees
that are the same as or lower than the fee payable under the fund's
present contract. Please refer to the proxy statement for specific
details of the amended management contract proposal.
WHY IS FIDELITY TECHNOQUANT GROWTH FUND PROPOSING AN AMENDED
MANAGEMENT CONTRACT? (PROPOSAL 6)
The amended management contract provides for lower management fees to
be paid to FMR when FMR's assets under management exceed certain
levels. The fund's amended management contracts also allow FMR and the
trust, on behalf of the fund, to modify the fund's management contract
subject to the requirements of the 1940 Act.
The amended management contract will result in management fees that
are the same as or lower than the fee payable under the fund's present
contract. Please refer to the proxy statement for specific details of
the amended management contract proposals.
WHAT IS A SUB-ADVISORY AGREEMENT AND HOW WILL THE PROPOSED AMENDED
SUB-ADVISORY AGREEMENTS AFFECT EACH FUND? (PROPOSALS 7 AND 8)
Generally, the sub-advisory agreements allow FMR increased access to
more specialized investment expertise in foreign markets. Each fund's
amended sub-advisory agreements allow FMR, FMR U.K., FMR Far East, and
the trust, on behalf of the fund, to modify the fund's sub-advisory
agreements subject to the requirements of the 1940 Act. FMR U.K., with
its principal office in London, England, and FMR Far East, with its
principal office in Tokyo, Japan, are wholly owned subsidiaries of
FMR. The amended agreements would not affect the fees paid to FMR by
each fund.
WHAT IS A DISTRIBUTION AND SERVICE PLAN, AND WHY ARE FIDELITY CAPITAL
APPRECIATION FUND AND FIDELITY TECHNOQUANT GROWTH FUND PROPOSING TO
ADOPT ONE? (PROPOSAL 9)
The Distribution and Service Plan (the Plan) was approved by the Board
of Trustees as provided for by Rule 12b-1 (the Rule) of the 1940 Act.
The Rule provides that a mutual fund acting as a distributor of its
shares must do so according to a written Plan describing all material
aspects of the proposed financing of distribution. The Plan is
designed to avoid legal uncertainties that may arise from ambiguities
within the Rule.
The Plan dictates that all expenses relating to the distribution of
fund shares shall be paid for by FMR, or Fidelity Distributors
Corporation (FDC), a wholly owned subsidiary of FMR, out of past
profits and other resources including management fees paid by a fund
to FMR. The Plan does not authorize payments by the funds other than
those that are to be made to FMR under its management contract.
WHY ARE FIDELITY CAPITAL APPRECIATION FUND, FIDELITY DISCIPLINED
EQUITY FUND AND FIDELITY STOCK SELECTOR PROPOSING TO ELIMINATE CERTAIN
FUNDAMENTAL INVESTMENT POLICIES? (PROPOSALS 10, 11 AND 12)
The primary purpose of these proposals is to allow each fund to more
clearly communicate its investment strategy by standardizing its
investment disclosure in a manner consistent with other Fidelity funds
with similar investment disciplines. The elimination of these policies
is not expected to materially effect the way each fund is managed.
WHAT IS THE BENEFIT OF AMENDING THE FUNDAMENTAL INVESTMENT LIMITATION
CONCERNING DIVERSIFICATION TO EXCLUDE SECURITIES OF OTHER INVESTMENT
COMPANIES FROM THE LIMITATION FOR FIDELITY CAPITAL APPRECIATION FUND,
FIDELITY DISCIPLINED EQUITY FUND, FIDELITY STOCK SELECTOR, AND
FIDELITY VALUE FUND? (PROPOSAL 13)
This proposal would permit the funds, subject to the requirements of
the 1940 Act, to invest without limit in the securities of other
investment companies including the portion of each fund allocated to
the fixed-income market. Pursuant to an order of exemption granted by
the SEC, the fund may invest in short-term bond or money market funds
managed by FMR or an affiliate of FMR (the Investment Funds). FMR
anticipates that investing in the Investment Funds will benefit the
funds by enhancing the efficiency of the investment of cash generated
by fund shareholder or investment activity, or through the investment
of fund assets allocated to the short-term bond or money markets in
support of a fund's investment objective.
WHY IS FIDELITY CAPITAL APPRECIATION FUND PROPOSING TO AMEND ITS
FUNDAMENTAL INVESTMENT LIMITATION CONCERNING CONCENTRATION? (PROPOSAL
14)
The primary purpose of the proposed amendment is to clarify the fund's
fundamental concentration limitation to conform to a limitation that
is expected to become standard for all funds managed by FMR. Adoption
of the proposed limitation is not expected to affect the way in which
the fund is managed.
WHY IS FIDELITY VALUE FUND PROPOSING TO AMEND ITS FUNDAMENTAL
INVESTMENT LIMITATION CONCERNING UNDERWRITING? (PROPOSAL 15)
The primary purpose of the proposed amendment is to clarify the fund's
fundamental investment limitation concerning underwriting to a
limitation which is expected to become standard for all funds managed
by FMR. Adoption of the proposed limitation is not expected to affect
the way in which the fund is managed, the investment performance of
the fund, or the securities or instruments in which the fund invests.
HAS THE FUND'S BOARD OF TRUSTEES APPROVED EACH PROPOSAL?
Yes. The Board of Trustees has unanimously approved all of the
proposals and recommends that you vote to approve them.
HOW MANY VOTES AM I ENTITLED TO CAST?
As a shareholder, you are entitled to one vote for each dollar of net
asset value you own of a fund on the record date. The record date is
January 18, 2000.
HOW DO I VOTE MY SHARES?
You can vote your shares by completing and signing the enclosed proxy
card(s) and mailing it in the enclosed postage paid envelope. If you
need any assistance, or have any questions regarding the proposals or
how to vote your shares, please call Fidelity at 1-800-544-6666.
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."
