SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT (NO 2-62417)
UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 46 [x]
and
REGISTRATION STATEMENT (NO 811-2861)
UNDER THE INVESTMENT
COMPANY ACT OF 1940 [x]
Amendment No. ____ [ ]
Fidelity Money Market Trust II (December 29, 1994 to succeed and be
re-named Fidelity Money Market Trust)
(Exact Name of Registrant as Specified in Charter)
1209 Orange Street, Wilmington, DE 19801
(Address Of Principal Executive Offices) (Zip Code)
617-570-7000
(Registrant's Telephone Number, Including Area Code)
The Corporation Trust Company
1209 Orange St.
Wilmington, DE 19801
(Name and Address of Agent for Service)
It is proposed that this filing will become effective:
( ) immediately upon filing pursuant to paragraph (b)
(x) on December 29, 1994 pursuant to paragraph (b)
( ) 60 days after filing pursuant to paragraph (a)(i)
( ) on (date) pursuant to paragraph (a)(i)
( ) 75 days after filing pursuant to paragraph (a)(ii)
( ) on (date) pursuant to paragraph (a)(ii) of rule 485.
If appropriate, check the following box:
(x) this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
Registrant has filed a declaration pursuant to Rule 24f-2 under the
Investment Company Act of 1940 and filed the notice required by such Rule
on October 5, 1994.
Effective as of 4:00 p.m. Eastern Time on December 29, 1994 (the "Effective
Time"), Fidelity Money Market Trust II, a Delaware business trust (the
"Trust") will succeed to all the assets and liabilities of Fidelity Money
Market Trust, a Massachusetts business trust (the "predecessor"); the
Delaware Trust will then change its name to Fidelity Money Market Trust as
of the Effective Time. The Trust hereby adopts, pursuant to Rule 414 under
the Securities Act of 1933, this Registration Statement (nos. 2-62417 and
811-2861) of the Predecessor Trust as its own, effective as of the
Effective Time, for all purposes of the Securities Act of 1933, the
Securities Exchange Act of 1934, and the Investment Company Act of 1940.
Predecessor Trust has registered an indefinite number of shares under the
Securities Act of 1933 pursuant to Rule 24f-2 under the Investment Company
Act of 1940.
FIDELITY MONEY MARKET TRUST:
RETIREMENT GOVERNMENT MONEY MARKET PORTFOLIO
CROSS REFERENCE SHEET
Form N-1A Item Number
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Part A Prospectus Caption
1 Cover Page
2 Summary of Portfolio Expenses
3 a, b Financial Highlights
c Performance
4 a(i) The Trust and the Fidelity Organization
a(ii), b, c Investment Objective; Investment Policies, Risks and
Limitations;
Suitability
5 a The Trust and the Fidelity Organization
b, c, d, e The Trust and the Fidelity Organization;
Management Contract, Distribution and Service Plan; How to
Invest, Exchange and Redeem
f Portfolio Transactions
5A a, b, c *
6 a(i) The Trust and the Fidelity Organization
a(ii) How to Invest, Exchange and Redeem
a(iii), b, c, d *
e Cover Page; How to Invest, Exchange and Redeem
f, g How to Invest, Exchange and Redeem;
Distribution and Taxes
7 a Management Contract, Distribution and
Service Plan
b(i, ii) How to Invest, Exchange and Redeem
b(iii, iv *
b(v) How to Invest, Exchange and Redeem
c *
d How to Invest, Exchange and Redeem
e, f (i, ii) Management Contract, Distribution and
Service Plan
f (iii) *
8 a, b, c, d How to Invest, Exchange and Redeem
9 *
</TABLE>
* Not Applicable
Form N-1A Item Number
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Part B Statement of Additional Information
10,11 Cover Page
12 Description of the Trust
13 a,b,c Investment Policies, Risks and Limitations
d *
14 a,b Trustees and Officers
c *
15 a, b Description of the Trust
c Trustees and Officers
16 a(i) FMR
a(ii) Trustees and Officers
a(iii), b Management Contract; Distribution and Service Plan
c, d, e *
f Distribution and Service Plan
g *
h Description of the Trust
i Management Contract; Distribution and Service Plan
17 a Portfolio Transactions
b *
c Portfolio Transactions
d, e *
18 a Description of the Trust
b *
19 a Additional Purchase and Redemption Information
b Valuation of Portfolio Securities
c *
20 Taxes
21 a(i,ii) Management Contract; Distribution and Service Plan
a(iii),b,c *
22 Performance
23 Financial Statements for the Portfolios' fiscal year ended August
31, 1994 are incorporated by reference into the Statement of
Additional Information.
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* Not Applicable
FIDELITY MONEY MARKET TRUST 82 DEVONSHIRE STREET
Retirement Government Money Market Portfolio BOSTON, MASSACHUSETTS 02109
PROSPECTUS
Retirement Government Money Market Portfolio (the Portfolio) is a
diversified portfolio of Fidelity Money Market Trust (the Trust). The
Portfolio seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity by investing in
obligations issued or guaranteed as to principal and interest by the U.S.
government, its agencies or instrumentalities and in repurchase agreements
secured by these obligations.
AN INVESTMENT IN THE PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT THE PORTFOLIO WILL
MAINTAIN A STABLE $1.00 SHARE PRICE.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION. SHARES
ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY,
AND ARE SUBJECT TO INVESTMENT
RISK, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
The Portfolio is generally intended for investors in tax-saving retirement
plans. This Prospectus is designed to provide you with information before
investing and to help you decide if the Portfolio's goals match your own.
Please read and retain this document for future reference.
To learn more about the Portfolio and its investments, you can obtain a
copy of the Portfolio's most recent financial report and portfolio listing,
or a copy of the Statement of Additional Information (SAI) dated December
2 9 , 1994. The SAI has been filed with the Securities and Exchange
Commission (SEC) and is incorporated herein by reference. For a free copy
of either document, call the appropriate number below.
RETIREMENT PLAN ACCOUNTS - NATIONWIDE (TOLL FREE) 800-544-0276
FINANCIAL AND OTHER INSTITUTIONS - NATIONWIDE (TOLL FREE) 800-843-3001
If you are investing through a retirement plan sponsor or other
institution, refer to your plan materials or contact the institution
directly.
TABLE OF CONTENTS
Summary of Portfolio Expenses
Financial Highlights
Investment Objective
Investment Policies, Risks and Limitations
How to Invest, Exchange and Redeem
Distributions and Taxes
Portfolio Transactions
Performance
Management Contract, Distribution and Service Plan
The Trust and the Fidelity Organization
Appendix
LIKE ALL MUTUAL FUNDS, THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, OR ANY STATE
SECURITIES COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
1.SUMMARY OF PORTFOLIO EXPENSES
The purpose of the table below is to assist investors in understanding the
various costs and expenses that an investor in the Portfolio would bear
directly or indirectly. This standard format was developed for use by all
mutual funds to help investors make their investment decisions. This
expense information should be considered along with other important
information, such as the Portfolio's investment objective and past
performance. There are no transaction expenses associated with purchases or
sales of the Portfolio's shares.
A. ANNUAL OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees . 42 %
Other Expenses .00
TOTAL OPERATING EXPENSES . 42 %
B. EXAMPLE: You would pay the following expenses on a $1,000
investment, assuming (1) a 5% annual return and (2) redemption at the end
of each time period:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
$4 $13 $24 $53
EXPLANATION OF TABLE
A. ANNUAL OPERATING EXPENSES are based on the Portfolio's
historical expenses . Management fees are paid by the Portfolio to
Fidelity Management & Research Company (FMR) for managing its investments
and business affairs. FMR is responsible for the payment of all of the
expenses of the Portfolio with the exception of certain limited expenses.
Please refer to the section "Management Contract, Distribution and Service
Plan" on page for further information.
B. EXAMPLE. The hypothetical example illustrates the expenses
associated with a $1,000 investment over periods of 1, 3, 5 and 10 years,
based on the expenses in the table and an assumed annual rate of return of
5%. THE RETURN OF 5% AND EXPENSES SHOULD NOT BE CONSIDERED
INDICATIONS OF ACTUAL OR EXPECTED PORTFOLIO PERFORMANCE OR EXPENSES, BOTH
OF WHICH MAY VARY.
2.FINANCIAL HIGHLIGHTS
The table that follows is included in the Portfolio's Annual Report and has
been audited by Coopers & Lybrand L.L.P., independent accountants.
Their report on the financial statements and financial highlights is
included in the Annual Report. The financial statements and financial
highlights are incorporated by reference into the Portfolio's SAI.
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Year Ended August 31, Ten Months Year Ended October 31, December 16,
Ended 1988
August 31, (commenceme
nt of
operations) to
October 31
SELECTED PER-SHARE DATA
1994 1993 1992 1991 1990 1989
Net asset value, beginning of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations
.032 .029 .034 .061 .079 .077
Net interest income
Less Distributions
(.032) (.029) (.034) (.061) (.079) (.077)
From net interest income
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURNB
3.27% 2.95% 3.47% 6.29% 8.16% 7.98%
Ratios and Supplemental Data
Net assets, end of period (000 omitted)
$ 1,655,404 $ 1,393,583 $ 1,236,529 $ 936,869 $ 410,889 $ 60,496
Ratio of expenses to average net assets
.42% .42% .42% .42% .42% .42%A
A
Ratio of net interest income to average net
3.26% 2.90% 4.08% 5.98% 7.85% 8.87%A
assets A
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A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
3.INVESTMENT OBJECTIVE
Retirement Government Money Market Portfolio's investment objective is to
obtain as high a level of current income as is consistent with the
preservation of capital and liquidity. FMR will buy obligations for the
Portfolio consistent with its investment objective, and which meet the
quality and maturity standards established for the Portfolio. The
Portfolio's investment objective is fundamental and may not be changed
without the affirmative vote of a majority of the outstanding shares of the
Portfolio. No assurance can be made that the Portfolio will achieve its
objective, but it will follow the investment style described in the
following paragraphs.
4. INVESTMENT POLICIES, RISKS AND LIMITATIONS
The Portfolio invests only in obligations issued or guaranteed as to
principal and interest by the U.S. government or by any of its agencies or
instrumentalities. The Portfolio may engage in short sales against the box,
repurchase agreements and reverse repurchase agreements with respect
to such obligations. The Portfolio itself is not guaranteed by the U.S.
government.
U.S. Treasury notes and bills and certain agency securities, such as those
issued by the Federal Housing Administration, are backed by the full faith
and credit of the U.S. government. The Portfolio also may invest in
securities issued by government agencies or instrumentalities (such as
executive departments of the government or independent federal
organizations supervised by Congress), which may have different degrees of
government backing but which are not backed by the full faith and credit of
the U.S. government. For example, securities issued by the Federal Farm
Credit Bank System and the Federal National Mortgage Association are
supported by the agency's right to borrow money from the U.S. Treasury
under certain circumstances. However, securities issued by the Financing
Corporation are supported only by the credit of the entity that issued
them. There is no guarantee that the U.S. government will support U.S.
government agency securities, and, accordingly, they may involve a risk of
nonpayment of principal and interest.
QUALITY AND MATURITY. Pursuant to procedures adopted by the Board of
Trustees, the Portfolio may purchase only high quality securities that FMR
believes present minimal credit risks. To be considered high quality, a
security must be rated in accordance with applicable rules in one of the
two highest rating categories for short-term securities by at least two
nationally recognized rating services (or by one, if only one rating
service has rated the security), or, if unrated, judged to be of equivalent
quality by FMR.
The Portfolio currently intends to limit its investments to securities
with remaining effective maturities of 397 days or less and to maintain a
dollar-weighted average maturity of 90 days or less. When determining the
maturity of a security, the Portfolio may look to an interest rate reset or
demand feature.
INVESTMENT LIMITATIONS. The following summarizes the Portfolio's
principal investment limitations. A complete listing is contained in the
SAI.
1. With respect to 75% of its total assets, the Portfolio may not invest
more than 5% in the securities of any issuer (other than U.S.
government securities).
2. The Portfolio may not purchase the securities of any issuer (other than
U.S. government securities), if as a result, more than 25% of its total
assets would be invested in issuers whose principal business activities are
in the same industry.
3. (a) The Portfolio may ( i ) borrow money for temporary or
emergency purposes and ( ii ) engage in reverse repurchase agreements
for any purpose; provided that ( i ) and ( ii ) in combination do
not exceed 33 1/3% of its total asset s. (b) The Portfolio may not
purchase securities when borrowings (other than reverse repurchase
agreements) exceed 5% of its total assets.
Except for the Portfolio's investment objective and investment
limitations 1, 2, and 3(a) , the investment policies described in this
Prospectus are not fundamental and may be changed without
shareholder approval. Except for the percentage limitation in
3 (a) above, these limitations and policies are considered at the time
of purchase; the sale of securities is not required in the event of a
subsequent change in circumstances. As a non-fundamental policy, the
Portfolio may invest up to 10% of its net assets in illiquid investments.
A complete listing of the Portfolio's investment limitations is
contained in the SAI.
SUITABILITY. The Portfolio's ability to achieve its investment
objective depends on the quality and maturity of its investments. Although
the Portfolio's investment policies are designed to help maintain a stable
$1.00 share price, all money market instruments can change in value when
interest rates or issuers' creditworthiness change, or if an issuer or
guarantor of a security fails to pay interest or principal when due. If
these changes in value were large enough, the Portfolio's share price could
fall below $1.00. In general, securities with longer maturities are more
sensitive to interest rate changes than are short-term securities, although
long-term securities may provide higher yields.
If you seek income at current money market rates while remaining
conveniently liquid, the Portfolio may be appropriate for you. It provides
the added safety of investments in U.S. government and agency obligations.
The Portfolio generally is designed for investors in tax-saving retirement
plans such as Defined Contribution Plans, 403(b) Custodial Accounts,
Defined Benefit Plans and 457 Plans. Minimum investments for these plans
may differ from those listed below .
By itself, the Portfolio does not constitute a balanced investment plan;
its objective stresses income with preservation of capital and liquidity,
and not the higher yields or capital appreciation that may be available
from more aggressive investments.
5.HOW TO INVEST, EXCHANGE AND REDEEM
Shares of the Portfolio are offered continuously and may be purchased at
the next determined net asset value per share (NAV) after an order is
received and accepted. The Portfolio's shares are sold without a sales
charge, although institutions may charge their clients fees in connection
with purchases and sales for the accounts of their clients. The NAV of the
Portfolio is determined by adding the value of all securities and other
assets of the Portfolio, deducting its actual and accrued liabilities, and
dividing by the number of shares outstanding. The Portfolio values its
securities on the basis of amortized cost. Fidelity Service Co. (Service),
calculates NAV at the close of the Portfolio's business day, which
coincides with the close of business of the New York Stock Exchange (NYSE),
normally 4:00 p.m. Eastern Time . (See "Holiday Schedule" on page .)
You begin to earn dividends as of the first business day following the day
of your purchase.
MINIMUM INVESTMENT AND ACCOUNT BALANCE. The minimum initial
investment to establish a new account in the Portfolio is $100,000.
Subsequent investments may be in any amount. To keep an account open, a
minimum balance of $100,000 must be maintained. If your account balance
falls below $100,000 due to redemption, the Portfolio may close the
account and mail the proceeds to you at the record address. You will be
given 30 days' notice that your account will be closed unless you make an
additional investment to increase your account balance to the $100,000
minimum. The minimum investment requirements may differ or may not apply to
participants of tax-saving retirement plans.
If you are purchasing shares of the Portfolio through a program of services
offered by a securities dealer, financial or other institution, you should
read the program materials in conjunction with this Prospectus. Certain
features of the Portfolio may be modified in these programs and
administrative charges may be imposed for the services rendered.
If you invest in this Portfolio through an employer-sponsored retirement
plan, some of the instructions, shareholder services and phone numbers that
follow will not apply. Speak to your institutional representative for
additional information.
HOW TO INVEST. An initial investment in the Portfolio must be
preceded or accompanied by a completed, signed application. Additional
paperwork may be required from corporations, associations and certain
fiduciaries.
TO INVEST BY MAIL. You must send a check payable to Fidelity Money
Market Trust: Retirement Government Money Market Portfolio, together with a
completed application, to:
Fidelity Money Market Trust:
Retirement Government Money Market Portfolio
c/o Fidelity Institutional Retirement Services Company
P.O. Box 650488
Dallas, TX 75265-0488
All of your purchases must be made in U.S. dollars, and checks must be
drawn on U.S. banks. No cash will be accepted. If you make a purchase with
more than one check, each check must have a value of at least $50, and the
minimum investment requirement still applies. The Portfolio reserves the
right to limit the number of checks processed at one time. If your check
does not clear, your purchase will be cancelled and you could be held
liable for any losses and/or fees incurred.
TO INVEST BY WIRE. You may purchase shares of the Portfolio by wire.
The Portfolio requires notification of all wire purchases. Prior to making
an initial investment, investors must call the institution through which
they trade or:
(solid bullet) RETIREMENT PLAN ACCOUNTS: call Retirement Trading at
1-800-962-1375 for wire information and instructions by the close of the
Portfolio's business day (4 :00 p.m.) to advise them of the wire and
to place the trade.
(solid bullet) FINANCIAL AND OTHER INSTITUTIONS: call Client
Services at 1-800-843-3001 for wire information and instructions by the
close of the Portfolio's business day (4 :00 p.m.) to advise them of
the wire and to place the trade.
In addition to the Portfolio's holiday schedule (see page ), shares
cannot be purchased by wire on Dr. Martin Luther King, Jr. Day (observed),
Columbus Day (observed), Veterans' Day (observed) or during any unscheduled
closings of the Federal Reserve Wire System.
Investments made by wire receive the NAV next determined as of the day the
order is received if federal funds, or monies immediately convertible to
federal funds, are received by the following business day prior to the
close of the NYSE (normally 4 :00 p.m.). It is recommended that
investors wire funds early in the day to ensure proper credit.
HOW TO EXCHANGE. An exchange is a convenient way to buy shares of
the Portfolio or other Fidelity funds. The Fidelity family of funds has a
variety of investment objectives. You may exchange shares of this Portfolio
for shares of other Fidelity funds (subject to the minimum initial
investment requirement) that are registered in your state. When making an
exchange, the name, address and tax identification numbers of the two
accounts must be identical. Investors must consult the prospectus of the
fund to be acquired to determine eligibility and suitability. To protect
the Portfolio's performance and shareholders, Fidelity discourages frequent
trading in response to short-term market fluctuations. In particular,
exchanges that coincide with "market timing" strategies can have adverse
effects on the funds.
You may exchange all or any part of the value of your accounts on any
business day. There is currently no limit on exchanges out of the
Portfolio; however, exchange limits may apply to other funds. Exchanges may
be requested in writing or by telephone and are effected at the NAV next
determined after receipt of the exchange request. If you exchange into a
fund with a sales charge, you pay the percentage difference between that
fund's sales charge and any sales charge you already have paid in
connection with the shares you are exchanging. This may not apply if you
are investing through a tax-saving retirement plan.
Each exchange actually represents the sale of shares of one fund and the
purchase of shares in another, which may produce a gain or loss for tax
purposes. A confirmation of each exchange transaction will be sent to you.
In order to allow FMR to manage the Portfolio most effectively, you are
strongly urged to initiate exchanges of shares as early in the day as
possible.
TO EXCHANGE BY TELEPHONE. Exchanges may be requested by calling:
RETIREMENT PLAN ACCOUNTS 800-962-1375
FINANCIAL AND OTHER INSTITUTIONS 800-843-3001
TO EXCHANGE BY MAIL. Written requests for exchanges should contain
the Portfolio name, account number and number of shares to be redeemed, and
the name of the fund whose shares are being purchased. The request must be
signed by a person authorized to act on behalf of the account. Letters
should be sent to:
Fidelity Money Market Trust:
Retirement Government Money Market Portfolio
c/o Fidelity Institutional Retirement Services Company
P.O. Box 650488
Dallas, TX 75265-0488
The Portfolio reserves the right at any time without prior notice to refuse
exchange purchases by any person or group if, in FMR's judgment, the
Portfolio would be unable to invest effectively in accordance with its
investment objective and policies or would otherwise potentially be
adversely affected. The Portfolio may terminate or modify the exchange
privilege in the future.
HOW TO REDEEM. You may redeem all or a portion of your shares on any
business day. Your shares will be redeemed at the next determined NAV
calculated after the Portfolio has received and accepted your redemption
request. When you redeem shares, the Portfolio normally will send you the
proceeds on the next business day. Shares will earn dividends through the
date of redemption; however, shares redeemed on a Friday or prior to a
holiday will continue to earn dividends until the next business day. The
Portfolio may hold payment on redemptions until it is reasonably satisfied
that investments made by check have been collected (which could take up to
seven days).
TO REDEEM BY WIRE. The wiring of redemption proceeds is available
only to investors who have previously established a wire account. In
addition to the Portfolio's holiday schedule (see page ), shares
cannot be redeemed by wire on Dr. Martin Luther King, Jr. Day (observed),
Columbus Day (observed), Veteran's Day (observed) or during any unscheduled
closings of the Federal Reserve Wire System.
TO REDEEM BY MAIL. Send a letter of instruction with your
signature(s) guaranteed to the address given above. The letter should
specify the name of the Portfolio, the number of shares to be redeemed,
your name, your account number, and should include the additional
requirements listed below that apply to your particular account.
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Type of Registration Requirements
Individual, Joint Tenant, Sole Proprietorship, Letter of instruction signed by all person(s) required
Custodial (Uniform Gifts or Transfers to Minors to sign for the account exactly as it is registered,
Act), General Partners accompanied by signature guarantee(s).
Corporations, Associations Letter of instruction and a corporate resolution,
signed by all person(s) required to sign for the
account exactly as it is registered accompanied by
signature guarantee(s).
</TABLE>
Trusts A letter of instruction signed by the Trustee(s) with a
signature guarantee. (If the Trustee's name is not
registered on the account, also provide a copy of the
trust document, certified within the last 60 days.)
If you do not fall into any of these registration categories (e.g.,
Executors, Administrators, Conservators, Guardians) , please call
Client Administration for further instructions.
A signature guarantee is a widely accepted way to protect you and Fidelity
Investments Institutional Operations Company (FIIOC) by verifying the
signature on your redemption request; it may not be provided by a notary
public. Signature guarantees will be accepted from banks, brokers, dealers,
municipal securities dealers, municipal securities brokers, government
securities dealers, government securities brokers, credit unions (if
authorized under state law), national securities exchanges, registered
securities associations, clearing agencies and savings associations.
TO REDEEM BY TELEPHONE. You may redeem shares of the Portfolio by
instructing FIIOC to have the proceeds of redemptions wired directly to
your designated bank account(s). To redeem by telephone call FIIOC before
4 :00 p.m.:
RETIREMENT PLAN ACCOUNTS 800-962-1375
FINANCIAL AND OTHER INSTITUTIONS 800-843-3001
Provided that your account registration has not changed within the last
3 0 days, you may redeem shares of the Portfolio worth
$ 100 ,000 or less by calling Institutional Trading. Redemption
proceeds will be sent to the record address.
If making immediate payment could adversely affect the Portfolio, it may
take up to seven (7) days to pay you. Also, when the NYSE is closed (or
when trading is restricted) for any reason other than its customary weekend
or holiday closings, or under any emergency circumstances as determined by
the SEC to merit such action, the Portfolio may suspend redemption or
postpone payment dates. If you are unable to execute your transaction by
telephone (for example, during times of unusual market activity), consider
placing your order by mail.
In order to allow FMR to manage the Portfolio most effectively, investors
are strongly urged to initiate redemptions of shares as early in the day as
possible and to notify the Portfolio at least one day in advance of large
redemptions.
ADDITIONAL INFORMATION. You may initiate many transactions by
telephone. Fidelity may only be liable for losses resulting from
unauthorized transactions if it does not follow reasonable procedures
designed to verify the identity of the caller. Fidelity will request
personalized security codes or other information, and may also record
calls. You should verify the accuracy of the confirmation statements
immediately after receipt. If you do not want the ability to redeem and
exchange by telephone, call Fidelity for instructions. Additional
documentation may be required from corporations, associations and certain
fiduciaries.
The Portfolio reserves the right to suspend the offering of shares for a
period of time. The Portfolio also reserves the right to reject any
specific purchase order, including certain purchases by exchange (see "How
to Exchange" on page ). Purchase orders may be refused if, in FMR's
opinion, they are of a size that would disrupt management of the Portfolio.
SHAREHOLDER SERVICES
TAX-SAVING RETIREMENT PLANS. Fidelity can set up your new account in
the Portfolio under one of several tax-sheltered plans. These plans let you
save for retirement and shelter your investment income from current taxes.
Minimums may differ from those listed on page and the corresponding
information may not apply. Retirement plan participants should refer to
their retirement plan's guidelines for further information.
DEFINED CONTRIBUTION PLANS such as 401(k), company sponsored IRA
programs, Thrift, Keogh or Corporate Profit-Sharing or Money-Purchase
Plans are open to self-employed people and their partners or to
corporations, to benefit themselves and their employees.
(solid bullet) 403(B) CUSTODIAL ACCOUNTS are open to
employees of most non-profit organizations.
(solid bullet) DEFINED BENEFIT PLANS are open to corporations
of all sizes to benefit their employees.
(solid bullet) 457 PLANS are open to employees of most
government agencies.
6.CHOOSING A DISTRIBUTION OPTION
When you fill out the application for your account, you can choose from two
distribution options.
A. The SHARE OPTION reinvests your distributions in additional
shares. You are assigned this option automatically if you make no choice on
your application.
B. The INCOME-EARNED OPTION distributes all dividends in cash to
you.
Participants in the above mentioned tax-saving retirement plans can elect
to take their distributions in kind and establish an IRA rollover account
in the Portfolio.
SUBACCOUNTING AND SPECIAL SERVICES. Special processing has been
arranged with FIIOC for banks, corporations and other institutions that
wish to open multiple accounts (a master account and subaccounts). An
investor wishing to utilize FIIOC's subaccounting facilities or other
special services for individual or multiple accounts may be required to
enter into a separate agreement with FIIOC. Charges for these services, if
any, will be determined on the basis of the level of services to be
rendered. Subaccounts may be opened with the initial investment or at a
later date and may be established by an investor with registration either
by name or by number.
The Portfolio pays for shareholder services, but not for special services,
such as a request for a historical transcript of an account. You may be
required to pay a fee for these special services.
STATEMENTS AND REPORTS. The Portfolio will send a statement of your
account after every transaction that affects your share balance or your
account registration. The Portfolio does not issue share certificates.
Dividend statements are mailed quarterly. At least twice a year you will
receive financial statements of the Portfolio. To reduce expenses, only one
copy of most fund reports (such as the Portfolio's Annual Report) will be
mailed to your household. Write to the Portfolio if you need to have
additional reports sent.
FIDELITY INVESTMENTS RATES AND YIELDS SERVICES LINE is Fidelity's
around-the-clock telephone service that lets existing customers use a
push - button phone with tone capabilities to obtain prices and yields
of their Fidelity funds. For more information about this service
contact Client Administration.
HOLIDAY SCHEDULE. The Portfolio is open for business and its NAV is
calculated each day the NYSE is open for trading. The NYSE has
designated the following holiday closings for 1995 : New Year's
Day (observed) , Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. Although
FMR expects the same holiday schedule to be observed in the future,
the NYSE may modify its holiday schedule at any time. On any day that the
NYSE closes early, or as permitted by the SEC, or on any day that the
principal government securities markets close early, such as on days in
advance of holidays generally observed by participants in such markets, the
right is reserved to advance the time on that day by which purchase and
redemption requests must be received. To the extent that portfolio
securities are traded in other markets on days the NYSE is closed, the
Portfolio's NAV may be affected on days when investors do not have access
to the Portfolio to purchase or redeem shares. Certain Fidelity funds may
follow different holiday schedules.
7.DISTRIBUTIONS AND TAXES
The Portfolio ordinarily declares dividends from net investment income
daily and pays such dividends monthly. The Portfolio intends to distribute
substantially all of its net investment income and capital gains, if any,
to shareholders within each calendar year as well as on a fiscal year
basis.
FEDERAL TAXES. Dividends derived from net investment income and
short-term capital gains are taxable as ordinary income. The Portfolio's
distributions are taxable when they are paid, whether you take them in cash
or reinvest them in additional shares, except that distributions declared
in December and paid in January are taxable as if paid on December 31. The
Portfolio will send you an Internal Revenue Service (IRS) Form 1099-DIV by
January 31 showing your taxable distributions for the past calendar year.
STATE AND LOCAL TAXES. Mutual fund dividends from most U.S.
government securities generally are free from state and local income taxes.
However, particular states may limit this benefit, and some types of
securities, such as repurchase agreements and some agency backed
securities, may not qualify for the benefit. Some states may impose
intangible property taxes.
OTHER TAX INFORMATION. The information above is only a summary of
some of the tax consequences generally affecting the Portfolio and its
shareholders, and no attempt has been made to discuss individual tax
consequences. In addition to federal tax, shareholders may be subject to
state or local taxes on their investments. Investors should consult their
tax advisors for details and up-to-date information on the tax laws in
their state to determine whether the Portfolio is suitable to their
particular tax situation.
When you sign your account application, you will be asked to certify that
your Social Security or taxpayer identification number is correct and that
you are not subject to 31% backup withholding for failing to report income
to the IRS. If you violate IRS regulations, the IRS can require the
Portfolio to withhold 31% of your taxable distributions and
redemptions .
Your tax situation may be different if you are investing through a
tax-saving retirement plan. Contact your tax advis o r or plan
administrator for further information.
8.PORTFOLIO TRANSACTIONS
Money market obligations generally are traded in the over-the-counter
market through broker-dealers. A broker-dealer is a securities firm or bank
which makes a market for securities by offering to buy at one price and
sell at a slightly higher price. The difference between the prices is known
as a spread. Since FMR trades, directly or through affiliated sub-advisers,
a large number of securities, including those of Fidelity's other funds,
broker-dealers are willing to work with the Portfolio on a more favorable
spread than would be possible for most individual investors.
The Portfolio has authorized FMR to allocate transactions to some
broker-dealers who help distribute the shares of the Portfolio or shares of
other Fidelity funds to the extent permitted by law, and on an
agency basis to an affiliate, Fidelity Brokerage Services, Inc. (FBSI). FMR
will allocate such transactions if commissions are comparable to those
charged by non-affiliated qualified broker-dealers for similar services.
Higher commissions may be paid to those firms that provide research
services to the extent permitted by law. FMR also is authorized to allocate
brokerage transactions to FBSI in order to secure from FBSI research
services produced by third party, independent entities. FMR may use this
research information in managing the Portfolio's assets, as well as assets
of other clients.
9.PERFORMANCE
The Portfolio advertises its YIELD and EFFECTIVE YIELD in
advertisements or in reports or other communications to shareholders. Both
yield figures are based on historical earnings and are not intended to
indicate future performance.
The Portfolio's yield refers to the income generated by an investment in
the Portfolio over a seven-day period expressed as an annual percentage
rate. The Portfolio also may calculate an EFFECTIVE YIELD by
compounding the base period return over a one-year period. The effective
yield, although calculated similarly, will be slightly higher than the
yield because it assumes that income earned from the investment is
reinvested (i.e., the compounding effect of reinvestment). For the
seven-day period ended August 31, 1994, the Portfolio's yield was
4.24 % and its effective yield was 4.33 %.
The Portfolio's TOTAL RETURN is based on the overall dollar or
percentage change in value of a hypothetical investment in the Portfolio
and assumes all distributions are reinvested.
A CUMULATIVE TOTAL RETURN reflects the Portfolio's performance over
a stated period of time.
An AVERAGE ANNUAL TOTAL RETURN reflects the hypothetical annually
compounded rate that would have produced the same cumulative total return
if the Portfolio's performance had been constant over the entire period.
Because average annual returns tend to smooth out variations in the
Portfolio's return, investors should recognize that they are not the same
as actual year-by-year results.
10.MANAGEMENT CONTRACT, DISTRIBUTION AND SERVICE PLAN
MANAGEMENT CONTRACT. For managing its investments and business
affairs, the Portfolio pays a monthly management fee to FMR at the annual
rate of .42% of the average net assets of the Portfolio throughout the
month. FMR pays all expenses of the Portfolio with the following
exceptions: the payment of fees and expenses of all Trustees of the Trust
who are not "interested persons" of the Trust or FMR; brokerage fees or
commissions (if any); interest on borrowings; taxes; and such extraordinary
non-recurring expenses as may arise, including litigation to which the
Portfolio may be a party. The management fee will be reduced by the fees
and expenses of those Trustees who are not "interested persons" of the
Trust paid by the Portfolio. For the fiscal year ended August 31, 1994, the
Portfolio paid FMR $6,336,847 in management fees before reduction
for the fees and expenses of the non-interested members of the Board of
Trustees.
FMR has entered into a sub-advisory agreement with FMR Texas Inc. (FMR
Texas), under which FMR Texas has primary responsibility for providing
portfolio investment management services, while FMR retains responsibility
for providing other management services. Under the terms of the agreement,
FMR pays FMR Texas fees equal to 50% of the management fees payable to FMR
under its current management contract with the Portfolio. The fees paid to
FMR Texas are not reduced by any voluntary or mandatory expense
reimbursements that may be in effect from time to time.
FIIOC performs transfer agency, dividend disbursing and shareholder
servicing functions for the Portfolio. Service calculates the Portfolio's
NAV and dividends, and maintains the Portfolio's general accounting
records. The costs of providing these services are borne by FMR pursuant to
its management contract with the Portfolio. Both FIIOC and Service are
affiliates of FMR.
FMR may, from time to time, agree to reimburse the Portfolio for expenses
above a specific percentage of average net assets. FMR retains the ability
to be repaid by the Portfolio for these expense reimbursements in the
amount that expenses fall below the limit prior to the end of the fiscal
year. Fee reimbursements by FMR will increase the Portfolio's yield, and
subsequent repayment by the Portfolio will lower its yield.
DISTRIBUTION AND SERVICE PLAN. The Board of Trustees, on behalf of
the Portfolio, has adopted a Distribution and Service Plan (the Plan)
pursuant to Rule 12b-1 (the Rule) under the Investment Company Act of 1940
(1940 Act). The Rule provides in substance that a mutual fund may not
engage directly or indirectly in financing any activity that is intended
primarily to result in the sale of shares of the fund except pursuant to a
plan adopted by the fund under the Rule. No separate payments are
authorized to be made by the Portfolio under the Plan. Rather, the Plan
recognizes that FMR may use its management fee or other resources to pay
expenses associated with activities primarily intended to result in the
sale of the Portfolio's shares.
11.THE TRUST AND THE FIDELITY ORGANIZATION
The Portfolio is a diversified portfolio of Fidelity Money Market Trust,
an open-end management investment company organized as a Delaware business
trust by Trust Instrument dated December 29, 1994. The Trust's Board of
Trustees supervises Trust activities and reviews contractual arrangements
with companies that provide the Portfolio with services. The Trust is not
required to hold annual shareholder meetings, although special meetings may
be called for a specific Portfolio or the Trust as a whole for purposes
such as electing or removing Trustees, changing fundamental investment
policies, or approving a new or amended management contract. As a
shareholder, the number of votes you are entitled to is based on the dollar
value of your investment.
Fidelity Investments is one of America's largest investment management
organizations and has its principal business address at 82 Devonshire
Street, Boston, MA 02109. It includes a number of different
companies which provide a variety of financial services and products.
The Trust employs various Fidelity companies to perform certain activities
required for its operation.
FMR , the Portfolio's adviser, is the original Fidelity company,
founded in 1946. FMR provides a number of mutual funds and other
clients with investment research and portfolio management services. FMR
maintains a large staff of experienced investment personnel and a full
complement of related support facilities. As of October 31 , 1994,
FMR advised funds having more than 21 million shareholder accounts
with a total value of more than $ 250 billion. Fidelity Distributors
Corporation (Distributors) distributes shares for the Fidelity funds.
FMR Corp. is the ultimate parent company of FMR and FMR Texas. Through
ownership of voting common stock, members of the Edward C. Johnson 3d
family form a controlling group with respect to FMR Corp. Changes may occur
in the Johnson family group, through death or disability, which would
result in changes in each individual family members' holding of stock. Such
changes could result in one or more family members becoming holders of
over 25% of the stock. FMR Corp. has
received an opinion of counsel that changes in the composition of the
Johnson family group under these circumstances would not result in the
termination of the Portfolio's management or distribution contracts and,
accordingly, would nor require a shareholder vote to continue operation
under those contracts.
12.APPENDIX
The following paragraphs provide a brief description of securities in which
the Portfolio may invest and transactions it may make. The Portfolio is not
limited by this discussion, however, and may purchase other types of
securities and enter into other types of transactions if they are
consistent with the Portfolio's investment objective and policies.
A complete listing of the Portfolio's policies and limitations and more
detailed information about the Portfolio's investments are contained in the
Portfolio's SAI. Current holdings and recent investment strategies are
described in the Portfolio's financial report, which is sent to
shareholders twice a year.
DELAYED DELIVERY TRANSACTIONS. The Portfolio may buy and sell
securities on a when-issued or delayed delivery basis, with payment and
delivery taking place at a future date. The market value of securities
purchased in this way may change before the delivery date, which could
affect the market value of the Portfolio's assets. Ordinarily, the
Portfolio will not earn interest on securities purchased until they are
delivered.
ILLIQUID INVESTMENTS. Under the supervision of the Board of
Trustees, FMR determines the liquidity of the Portfolio's investments. The
absence of a trading market can make it difficult to ascertain a market
value for illiquid investments. Disposing of illiquid investments may
involve time consuming negotiation and legal expenses, and it may be
difficult or impossible for the Portfolio to sell illiquid investments
promptly at an acceptable price.
INTERFUND BORROWING PROGRAM. The Portfolio has received permission
from the SEC to lend money to and borrow money from other funds advised by
FMR or its affiliates, but it will participate in the interfund borrowing
program only as a borrower. Interfund loans normally will extend overnight,
but can have a maximum duration of seven days. The Portfolio will borrow
through the program only when the costs are equal to or lower than the cost
of bank loans. The Portfolio will not borrow through the program if, after
doing so, total outstanding borrowings would exceed 15% of total assets.
Loans may be called on one day's notice, and the Portfolio may have to
borrow from a bank at a higher interest rate if an interfund loan is called
or not renewed.
REPURCHASE AGREEMENTS. In a repurchase agreement, the Portfolio buys
a security at one price and simultaneously agrees to sell it back at a
higher price. Delays or losses could result if the other party to the
agreement defaults or becomes insolvent.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement,
the Portfolio sells a portfolio instrument to another party, such as
a bank or broker-dealer, in return for cash. At the same time, the
Portfolio agrees to repurchase the instrument at an agreed upon price and
date. The Portfolio expects that it will engage in reverse repurchase
agreements for temporary purposes such as funding redemptions, or when it
is able to invest the cash so acquired at a rate higher than the cost of
the agreement , which would increase the income earned by the
Portfolio . Reverse repurchase agreements may increase the risk of
fluctuation in the market value of the Portfolio's assets or its yield.
STRIPPED SECURITIES are the separate income or
principal components of a debt instrument . These involve risks that are
similar to those of other debt securities, although they may be more
volatile, and certain stripped securities move in the same direction as
interest rates.
VARIABLE OR FLOATING RATE OBLIGATIONS have interest rates that
are periodically adjusted either at specific intervals or whenever a
benchmark rate changes. These interest rate adjustments are designed to
help stabilize the security's price.
RETIREMENT GOVERNMENT MONEY MARKET PORTFOLIO
A PORTFOLIO OF FIDELITY MONEY MARKET TRUST
STATEMENT OF ADDITIONAL INFORMATION
DECEMBER 2 9 , 1994
This Statement of Additional Information (SAI) is not a prospectus but
should be read in conjunction with the Portfolio's current Prospectus
(dated December 2 9 , 1994). Please retain this document for future
reference. To obtain an additional copy of the Portfolio's Prospectus and
Annual Report, please call:
RETIREMENT PLAN ACCOUNTS 800-544-0276
FINANCIAL AND OTHER INSTITUTIONS 800-843-3001
TABLE OF CONTENTS PAGE
Investment Policies and Limitations
Portfolio Transactions
Valuation of Portfolio Securities
Performance
Additional Purchase and Redemption Information
Distribution and Taxes
FMR
Trustees and Officers
Management and Service Contracts
Distribution and Service Plan
Description of the Trust
Financial Statements 1 2
INVESTMENT ADVISER
Fidelity Management & Research Company (FMR)
SUB-ADVISER
FMR Texas Inc. (FMR Texas)
DISTRIBUTOR
Fidelity Distributors Corporation ( FDC )
TRANSFER AGENT
Fidelity Investments Institutional Operations Company (FIIOC)
CUSTODIAN
Morgan Guaranty Trust Company of New York
RGM-PTB-1294
INVESTMENT POLICIES AND LIMITATIONS
The following policies and limitations supplement those set forth in the
Prospectus. Unless otherwise noted, whenever an investment policy or
limitation states a maximum percentage of the Portfolio's assets that may
be invested in any security or other asset, or sets forth a policy
regarding quality standards, such standard or percentage limitation will be
determined immediately after and as a result of the Portfolio's acquisition
of such security or other asset. Accordingly, any subsequent change in
values, net assets or other circumstances will not be considered when
determining whether the investment complies with the Portfolio's investment
policies and limitations.
The Portfolio's fundamental investment policies and limitations can not be
changed without approval by a "majority of the outstanding voting
securities" (as defined in the Investment Company Act of 1940 (1940 Act))
of the Portfolio. However, except for the fundamental investment
limitations set forth below, the investment policies and limitations
described in this SAI are not fundamental and may be changed without
shareholder approval. THE FOLLOWING ARE THE PORTFOLIO'S FUNDAMENTAL
INVESTMENT LIMITATIONS SET FORTH IN THEIR ENTIRETY. THE PORTFOLIO MAY NOT:
(1) with respect to 75% of the Portfolio's total assets, purchase the
security of any issuer (other than obligations issued or guaranteed by the
government of the United States, its agencies or instrumentalities) if, as
a result thereof: (a) more than 5% of the Portfolio's total assets would be
invested in the securities of such issuer, or (b) the Portfolio would hold
more than 10% of the voting securities of such issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the Portfolio may (i) borrow money for
temporary or emergency purposes (not for leveraging or investment), and
(ii) engage in reverse repurchase agreements for any purpose; provided that
(i) and (ii) in combination do not exceed 33 1/3% of the Portfolio's total
assets (including the amount borrowed) less liabilities (other than
borrowings). Any borrowings that come to exceed this amount will be reduced
within three days (not including Sundays and holidays) to the extent
necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others (except to the extent that the
Portfolio may be deemed to be an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted securities);
(5) purchase the securities of any issuer (other than obligations issued or
guaranteed as to principal and interest by the government of the United
States, its agencies or instrumentalities) if, as a result, more than 25%
of the Portfolio's total assets (taken at current value) would be invested
in the securities of issuers having their principal business activities in
the same industry;
(6) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the
Portfolio from investing in securities or other instruments backed by real
estate or securities of companies engaged in the real estate business);
(7) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments; or
(8) lend any security or make any other loan if, as a result, more than 33
1/3% of the Portfolio's total assets would be lent to other parties, but
this limitation does not apply to purchases of debt securities or to
repurchase agreements.
(9) The Portfolio may, notwithstanding any other fundamental investment
policy or limitation, invest all of its assets in the securities of a
single open-end management investment company with substantially the same
fundamental investment objective, policies and limitations as the
Portfolio.
THE FOLLOWING LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED WITHOUT
SHAREHOLDER APPROVAL.
(i) The Portfolio may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an affiliate
serves as investment adviser or (b) by engaging in reverse repurchase
agreements with any party. The Portfolio will not purchase any security
while borrowings (excluding reverse repurchase agreements) representing
more than 5% of its total assets are outstanding. The Portfolio will not
borrow from other funds advised by FMR or its affiliates if total
outstanding borrowings immediately after such borrowing would exceed 15% of
the Portfolio's total assets.
(ii) The Portfolio does not currently intend to sell securities short,
unless it owns or has the right to obtain securities equivalent in kind and
amount to the securities sold short, and provided that transactions in
futures contracts and options are not deemed to constitute selling
securities short.
(iii) The Portfolio does not currently intend to purchase any security if,
as a result, 10% or more of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(iv) The Portfolio does not currently intend to purchase securities on
margin, except that the Portfolio may obtain such short-term credits as are
necessary for the clearance of transactions, and provided that margin
payments in connection with futures contracts and options on futures
contracts shall not constitute purchasing securities on margin .
(v) The Portfolio does not currently intend to make loans, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(vi) The Portfolio does not currently intend to purchase or sell futures
contracts or call options. This limitation does not apply to options
attached to, or acquired or traded together with, their underlying
securities, and does not apply to securities that incorporate features
similar to options or futures contracts.
(vii) The Portfolio does not currently intend to purchase the securities of
any issuer (other than securities issued or guaranteed by domestic or
foreign governments or political subdivisions thereof) if, as a result,
more than 5% of its total assets would be invested in the securities of
business enterprises that, including predecessors, have a record of less
than three years of continuous operation.
(viii) The Portfolio does not currently intend to invest in oil, gas, or
other mineral exploration or development programs or leases.
(ix) The Portfolio does not currently intend to purchase the securities of
any issuer if those officers and Trustees of the Trust and those officers
and directors of FMR who individually own more than 1/2 of 1% of the
securities of such issuer together own more than 5% of such issuer's
securities.
(x) The Portfolio does not currently intend to invest all of its assets in
the securities of a single open-end management investment company
managed by FMR or an affiliate or successor with the same
fundamental investment objective, policies, and limitations as the
Portfolio.
For the Portfolio's policies on quality and maturity, see the section
entitled "Quality and Maturity" below .
AFFILIATED BANK TRANSACTIONS. The Portfolio may engage in transactions with
financial institutions that are, or may be considered to be, "affiliated
persons" of the Portfolios under the 1940 Act. These transactions may
include repurchase agreements with custodian banks; short-term obligations
of, and repurchase agreements with, the 50 largest U.S. banks (measured by
deposits); municipal securities; U.S. government securities with affiliated
financial institutions that are primary dealers in these securities;
short-term currency transactions; and short-term borrowings. In accordance
with exemptive orders issued by the Securities and Exchange Commission
(SEC), the Board of Trustees has established and periodically reviews
procedures applicable to transactions involving affiliated financial
institutions.
DELAYED DELIVERY TRANSACTIONS. The Portfolio may buy and sell securities on
a delayed delivery or when-issued basis. These transactions involve a
commitment by the Portfolio to purchase or sell specific securities at a
predetermined price and/or yield, with payment and delivery taking place
after the customary settlement period for that type of security (and more
than seven days in the future). Typically, no interest accrues to the
purchaser until the security is delivered.
When purchasing securities on a delayed delivery basis, the Portfolio
assumes the rights and risks of ownership, including the risk of price and
yield fluctuations. Because the Portfolio is not required to pay for
securities until the delivery date, these risks are in addition to the
risks associated with the Portfolio's other investments. If the Portfolio
remains substantially fully invested at a time when delayed delivery
purchases are outstanding, the delayed delivery purchases may result in a
form of leverage. When delayed delivery purchases are outstanding, the
Portfolio will set aside appropriate liquid assets in a segregated
custodial account to cover its purchase obligations. When the Portfolio has
sold a security on a delayed delivery basis, the Portfolio does not
participate in further gains or losses with respect to the security. If the
other party to a delayed delivery transaction fails to deliver or pay for
the securities, the Portfolio could miss a favorable price or yield
opportunity, or could suffer a loss.
The Portfolio may renegotiate delayed delivery transactions after they are
entered into, and may sell underlying securities before they are delivered,
which may result in capital gains or losses.
ILLIQUID INVESTMENTS are investments that cannot be sold or disposed of in
the ordinary course of business at approximately the prices at which they
are valued. Under the supervision of the Board of Trustees, FMR determines
the liquidity of the Portfolio's investments and, through reports from FMR,
the Board monitors trading activity in illiquid instruments. In determining
the liquidity of the Portfolio's investments, FMR may consider various
factors including (1) the frequency of trades and quotations, (2) the
number of dealers and prospective purchasers in the marketplace, (3) dealer
undertakings to make a market, (4) the nature of the security (including
any demand or tender features) and (5) the nature of the marketplace for
trades (including the ability to assign or offset the Portfolio's rights
and obligations relating to the investment). Investments currently
considered by the Portfolio to be illiquid include repurchase agreements
not entitling the holder to payment of principal and interest within seven
days. In the absence of market quotations, illiquid investments are valued
for purposes of monitoring amortized cost valuation at fair value as
determined in good faith by a committee appointed by the Board of Trustees.
If through a change in values, net assets or other circumstances, the
Portfolio were in a position where 10% or more of its net assets were
invested in illiquid securities, it would seek to take appropriate steps to
protect liquidity.
QUALITY AND MATURITY. Pursuant to procedures adopted by the Board of
Trustees, the Portfolio may purchase only high-quality securities that FMR
believes present minimal credit risks. To be considered high quality, a
security must be rated in accordance with applicable rules in one of
the two highest categories for short-term securities by at least two
nationally recognized rating services (or by one, if only one rating
service has rated the security); or, if unrated, judged to be of equivalent
quality by FMR.
The Portfolio currently intends to limit its investments to securities with
remaining maturities of 397 days or less, and to maintain a dollar-weighted
average maturity of 90 days or less. When determining the maturity of a
security, the Portfolio may look to an interest rate reset or demand
feature.
REPURCHASE AGREEMENTS. In a repurchase agreement, the Portfolio purchases a
security and simultaneously commits to sell that security back to the
original seller at an agreed-upon price. The resale price reflects the
purchase price plus an agreed-upon incremental amount which is unrelated to
the coupon rate or maturity of the purchased security. While it does not
presently appear possible to eliminate all risks from these transactions
(particularly the possiblility that the value of the underlying security
will be less than the resale price as well as delay and costs to the
Portfolio in connection with bankruptcy proceedings), it is the Portfolio's
current policy to engage in repurchase agreement transactions with parties
whose creditworthiness has been reviewed and found satisfactory by FMR.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, the
Portfolio sells a portfolio instrument to another party, such as a bank or
a broker-dealer, in return for cash and agrees to repurchase the instrument
at a particular price and time. While a reverse repurchase agreement is
outstanding, the Portfolio will maintain appropriate liquid assets in a
segregated custodial account to cover its obligation under the agreement.
The Portfolio will enter into reverse repurchase agreements only with
parties whose creditworthiness has been found satisfactory by FMR. Such
transactions may increase fluctuations in the market value of the
Portfolio's assets and may be viewed as a form of leverage.
STRIPPED GOVERNMENT SECURITIES are created by separating the income and
principal components of a debt instrument and selling them separately. The
Portfolio may purchase U.S. Treasury STRIPS (Separate Trading of Registered
Interest and Principal of Securities) that are created when the coupon
payments and the principal payment are stripped from an outstanding
Treasury bond by the Federal Reserve Bank. Bonds issued by the Resolution
Funding Corporation (REFCORP) can also be stripped in this fashion. REFCORP
Strips are eligible investments for the Portfolio.
SHORT SALES AGAINST THE BOX. The Portfolio may sell securities short when
it owns or has the right to obtain securities equivalent in kind or amount
to the securities sold short. Short sales could be used to protect the net
asset value per share (NAV) of the Portfolio in anticipation of increased
interest rates without sacrificing the current yield of the securities sold
short. If the Portfolio enters into a short sale against the box, it will
be required to set aside securities equivalent in kind and amount to the
securities sold short (or securities convertible or exchangeable into such
securities) and will be required to continue to hold such securities while
the short sale is outstanding. The Portfolio will incur transaction costs,
including interest expenses, in connection with opening, maintaining and
closing short sales against the box.
VARIABLE AND FLOATING RATE SECURITIES provide for periodic
adjustments of the interest rate paid. Variable rate securities provide for
a specified periodic adjustment in the interest rate, while floating rate
securities have interest rates that change whenever there is a change in a
designated benchmark rate.
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are placed on
behalf of the Portfolio by FMR pursuant to authority contained in the
management contract. If FMR grants investment management authority to the
sub-adviser (see section entitled "Management and Service
Contracts"), the sub-adviser will be authorized to place orders for the
purchase and sale of portfolio securities, and will do so in accordance
with the policies described below. FMR is also responsible for the
placement of transaction orders for other investment companies and accounts
for which it or its affiliates act as investment adviser. Securities
purchased and sold by the Portfolio generally will be traded on a net basis
(i.e., without commission). In selecting broker-dealers, subject to
applicable limitations of the federal securities laws, FMR considers
various relevant factors, including, but not limited to, the size and type
of the transaction; the nature and character of the markets for the
security to be purchased or sold; the execution efficiency, settlement
capability, and financial condition of the broker-dealer firm; the
broker-dealer's execution services rendered on a continuing basis; and the
reasonableness of any commissions.
The Portfolio may execute portfolio transactions with broker-dealers who
provide research and execution services to the Portfolio and other accounts
over which FMR or its affiliates exercise investment discretion. Such
services may include advice concerning the value of securities; the
advisability of investing in, purchasing, or selling securities; the
availability of securities or the purchasers or sellers of securities;
furnishing analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy and performance of
accounts; and effecting securities transactions and performing functions
incidental thereto (such as clearance and settlement). FMR maintains a
listing of broker-dealers who provide such services on a regular basis.
However, as many transactions on behalf of the Portfolio are placed with
broker-dealers (including broker-dealers on the list) without regard to the
furnishing of such services, it is not possible to estimate the proportion
of such transactions directed to such broker-dealers solely because such
services were provided. The selection of such broker-dealers generally is
made by FMR (to the extent possible consistent with execution
considerations) based upon the quality of research and execution services
provided.
The receipt of research from broker-dealers that execute transactions on
behalf of the Portfolio may be useful to FMR in rendering investment
management services to the Portfolio or its other clients, and conversely,
such research provided by broker-dealers who have executed transaction
orders on behalf of other FMR clients may be useful to FMR in carrying out
its obligations to the Portfolio. The receipt of such research has not
reduced FMR's normal independent research activities; however, it enables
FMR to avoid the additional expenses that could be incurred if FMR tried to
develop comparable information through its own efforts.
Subject to applicable limitations of the federal securities laws,
broker-dealers may receive commissions for agency transactions that are in
excess of the amount of commissions charged by other broker-dealers in
recognition of their research and execution services. In order to cause the
Portfolio to pay such higher commissions, FMR must determine in good faith
that such commissions are reasonable in relation to the value of the
brokerage and research services provided by such executing broker-dealers,
viewed in terms of a particular transaction or FMR's overall
responsibilities to the Portfolio and its other clients. In reaching this
determination, FMR will not attempt to place a specific dollar value on the
brokerage and research services provided, or to determine what portion of
the compensation should be related to those services.
FMR is authorized to use research services provided by, and to place
portfolio transactions with, brokerage firms that have provided assistance
in the distribution of shares of the Portfolio or shares of other Fidelity
funds to the extent permitted by law. FMR may use research services
provided by and place agency transactions with Fidelity Brokerage Services,
Inc. (FBSI) and Fidelity Brokerage Services, Ltd. (FBSL), subsidiaries of
FMR Corp., if the commissions are fair, reasonable, and comparable to
commissions charged by non-affiliated, qualified brokerage firms for
similar services.
Section 11(a) of the Securities Exchange Act of 1934 prohibits members of
national securities exchanges from executing exchange transactions for
accounts which they or their affiliates manage, unless certain requirements
are satisfied. Pursuant to such requirements, the Board of Trustees has
authorized FBSI to execute portfolio transactions on national securities
exchanges in accordance with approved procedures and applicable SEC rules.
The Trustees periodically review FMR's performance of its responsibilities
in connection with the placement of portfolio transactions on behalf of the
Portfolio and review the commissions paid by the Portfolio over
representative periods of time to determine if they are reasonable in
relation to the benefits to the Portfolio.
From time to time the Trustees will review whether the recapture for the
benefit of the Portfolio of some portion of the brokerage commissions or
similar fees paid by the Portfolio on portfolio transactions is legally
permissible and advisable. The Portfolio seeks to recapture soliciting
broker-dealer fees on the tender of portfolio securities, but at present no
other recapture arrangements are in effect. The Trustees intend to continue
to review whether recapture opportunities are available and are legally
permissible and, if so, to determine, in the exercise of their business
judgment whether it would be advisable for the Portfolio to seek such
recapture.
Although the Trustees and officers of the Portfolio are substantially the
same as those of other funds managed by FMR, investment decisions for the
Portfolio are made independently from those of other funds managed by FMR
or accounts managed by FMR affiliates. It sometimes happens that the same
security is held in the portfolio of more than one of these funds or
accounts. Simultaneous transactions are inevitable when several funds are
managed by the same investment adviser, particularly when the same security
is suitable for the investment objective of more than one fund or account.
When two or more funds are simultaneously engaged in the purchase or sale
of the same security, the prices and amounts are allocated in accordance
with procedures believed to be appropriate and equitable for the Portfolio.
In some cases this system could have a detrimental effect on the price or
value of the security as far as the Portfolio is concerned. In other cases,
however, the ability of the Portfolio to participate in volume transactions
will produce better executions and prices for the Portfolio. It is the
current opinion of the Trustees that the desirability of retaining FMR as
investment adviser to the Portfolio outweighs any disadvantages that may be
said to exist from exposure to simultaneous transactions.
VALUATION OF PORTFOLIO SECURITIES
The Portfolio values its investments on the basis of amortized cost. This
technique involves valuing an instrument at its cost as adjusted for
amortization of premium or accretion of discount rather than its value
based on current market quotations or appropriate substitutes which reflect
current market conditions. The amortized cost value of an instrument may be
higher or lower than the price the Portfolio would receive if it sold the
instrument.
Valuing the Portfolio's instruments on the basis of amortized cost and use
of the term "money market fund" are permitted by Rule 2a-7 under the 1940
Act. The Portfolio must adhere to certain conditions under Rule 2a-7; these
conditions are summarized in the Prospectus.
The Board of Trustees of the Trust oversees FMR's adherence to SEC rules
concerning money market funds, and has established procedures designed to
stabilize the Portfolio's NAV at $1.00. At such intervals as they deem
appropriate, the Trustees consider the extent to which NAV calculated by
using market valuations would deviate from $1.00 per share. If the Trustees
believe that a deviation from the Portfolio's amortized cost per share may
result in material dilution or other unfair results to shareholders, the
Trustees have agreed to take such corrective action, if any, as they deem
appropriate to eliminate or reduce, to the extent reasonably practicable,
the dilution or unfair results. Such corrective action could include
selling portfolio instruments prior to maturity to realize capital gains or
losses or to shorten average portfolio maturity; withholding dividends;
redeeming shares in kind; establishing NAV by using available market
quotations; and such other measures as the Trustees may deem appropriate.
During periods of declining interest rates, the Portfolio's yield based on
amortized cost may be higher than the yield based on market valuations.
Under these circumstances, a shareholder in the Portfolio would be able to
obtain a somewhat higher yield than would result if the Portfolio utilized
market valuations to determine its NAV. The converse would apply in a
period of rising interest rates.
PERFORMANCE
The Portfolio's performance may be compared to the performance of other
mutual funds in general, or to the performance of particular types of
mutual funds. These comparisons may be expressed as mutual fund rankings
prepared by Lipper Analytical Services, Inc. (Lipper), an independent
service located in Summit, New Jersey, which monitors the performance of
mutual funds. Lipper generally ranks funds on the basis of total return,
assuming reinvestment of distributions, but does not take sales charges or
redemption fees into consideration, and is prepared without regard to tax
consequences. Lipper may also rank the funds based on yield. In addition to
the mutual fund rankings, the fund's performance may be compared to mutual
fund performance indices prepared by Lipper.
The Portfolio's performance or the performance of securities in which it
may invest may also be compared to averages published by IBC/USA
(Publications) Inc. of Ashland, MA 01720. These averages assume
reinvestment of distributions. The Money Fund Averages/Government, which is
reported in the Money Fund Report, covers over 198 government money market
funds. The Portfolio may reference the growth and variety of money market
mutual funds and FMR's innovation and participation in the industry.
The Portfolio also may compare its performance to the yields or averages of
other money market securities as reported by the Federal Reserve Bulletin,
by TeleRate, a financial information network, or by Salomon Brothers Inc.,
a broker-dealer firm, and to other fixed-income investments such as
Certificates of Deposit (CDs). The principal value and interest rate of CDs
and money market securities are fixed at the time of purchase, whereas the
Portfolio's yield will fluctuate. Unlike some CDs and certain other money
market securities, money market mutual funds are not insured by the FDIC.
Investors should give consideration to the quality and maturity of the
portfolio securities of the respective investment companies when comparing
investment alternatives.
YIELD CALCULATIONS. The Portfolio's yield refers to the income generated by
an investment in the Portfolio over a seven day period expressed as an
annual percentage rate. The effective yield, although calculated similarly,
will be slightly higher than the yield because it assumes that income
earned from the investment is reinvested (the compounding effect of
reinvestment). In addition to the current yield , the Portfolio may quote
yields in advertising based on any historical seven day periods.
TOTAL RETURN CALCULATIONS. Total returns quoted in advertising reflect all
aspects of the Portfolio's return, including the effect of reinvesting
dividends and capital gain distributions (if any). Average annual returns
are calculated by determining the growth or decline in value of a
hypothetical historical investment in the Portfolio over a stated period,
and then calculating the annually compounded percentage rate that would
have produced the same result if the rate of growth or decline in the value
of the investment had been constant over the period. For example, a
cumulative return of 100% over ten years would produce an average annual
return of 7.18%, which is the steady annual rate that would equal 100%
growth on a compounded basis in ten years. While average annual returns are
a convenient means of comparing investment alternatives, investors should
realize that the Portfolio's performance is not constant over time, but
changes from year to year, and that average annual returns represent
averaged figures as opposed to the actual year-to-year performance of the
Portfolio.
In addition to average annual returns, the Portfolio may quote unaveraged
or cumulative total returns reflecting the simple change in the value of an
investment over a stated period. Average annual and cumulative total
returns may be quoted as percentages or as dollar amounts and may be
calculated for a single investment, a series of investments or a series of
redemptions over any time period. Total returns may be broken down into
their components of income and capital in order to illustrate the
relationship of these factors and their contributions to total return.
Total returns, yields, and other performance information may be quoted
numerically or in a table, graph, or similar illustration. The Portfolio's
cumulative total returns and average annual returns for the fiscal year
ended August 31, 1994 were as follows:
Historical Portfolio Results
<TABLE>
<CAPTION>
<S> <C> <C> <C>
One Year Five Year Life of Portfolio*
Average Annual Total Returns 3.27% 5.11 % 5.61%
Cumulative Total Returns 3.27% 28.28 % 36.55%
</TABLE>
* Life of Portfolio from December 16, 1988 to August 31, 1994.
The following chart shows the income and capital elements of the
Portfolio's year-by-year total returns for the period December 16, 1988
through August 31, 1994 as compared to the cost of living measured by the
Consumer Price Index over the same period.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Period Initial $10,000 Value of Value of Total Consumer
Investment Reinvestment Reinvestment Value Price
Dividends Capital Gains Index**
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
10/31/89* $ 10,000 $ 798 $ 0 $ 10,798 $ 10,441
10/31/90 10,000 1,679 0 11,679 11,097
10/31/91 10,000 2,413 0 12,413 11,421
08/31/92*** 10,000 2,844 0 12,844 11,7 12
08/31/93 10,000 3,223 0 13,223 12,037
08/31/94 10,000 3,655 0 13,655 12,386
</TABLE>
* From December 16, 1988.
** From month-end closest to the initial investment date.
*** This period reflects the Portfolio's change of fiscal year end date
from October 31 to August 31.
Explanatory Notes: With an initial investment of $10,000 made on December
16, 1988, the net amount invested in shares of the Portfolio was $10,000.
The cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends for the period covered (that is, their cash
value at the time they were reinvested) amounted to $13,655 . If
distributions had not been reinvested, the amount of distributions earned
from the Portfolio over time would have been smaller and the cash payments
(dividends) for the period would have come to $3,124 . The Portfolio
did not distribute any capital gains during the period.
The Portfolio may reference and discuss its fund number, Quotron number,
CUSIP number, and current portfolio manager in advertising.
From time to time, in reports and promotional literature, the Portfolio's
performance also may be compared to other mutual funds tracked by financial
or business publications and periodicals. For example, the Portfolio may
quote Morningstar, Inc. in its advertising materials. Morningstar, Inc. is
a mutual fund rating service that rates mutual funds on the basis or
risk-adjusted performance. In addition, the Portfolio may quote financial
or business publications and periodicals as they relate to portfolio
management, investment philosophy, and investment techniques. Rankings that
compare the performance of Fidelity funds to one another in appropriate
categories over specific periods of time may also be quoted in advertising.
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION
If the Trustees determine that existing conditions make cash payment
undesirable, redemption payments may be made in whole or in part in
securities or other property, valued for this purpose as they are valued in
computing the Portfolio's NAV. Shareholders receiving securities or other
property on redemption may realize a gain or loss for tax purposes, and
will incur any costs of sale, as well as the associated inconveniences.
Pursuant to Rule 11a-3 under the 1940 Act, the Portfolio is required to
give shareholders at least 60 days' notice prior to terminating or
modifying its exchange privilege. Under the Rule, the 60-day notification
requirement may be waived if (i) the only effect of a modification would be
to reduce or eliminate an administrative fee, redemption fee or deferred
sales charge ordinarily payable at the time of exchange, or (ii) the
Portfolio suspends the redemption of shares to be exchanged as permitted
under the 1940 Act or the rules and regulations thereunder, or the fund to
be acquired suspends the sale of its shares because it is unable to invest
amounts effectively in accordance with its investment objective and
policies.
The Portfolio has notified shareholders that it reserves the right at any
time, without prior notice, to refuse exchange purchases by any person or
group if, in FMR's judgment, the Portfolio would be unable to invest
effectively in accordance with its investment objective and policies or
might otherwise be adversely affected.
DISTRIBUTION AND TAXES
DISTRIBUTIONS. If you request to have distributions mailed to you and the
U.S. Postal Service cannot deliver your checks, or if your checks remain
uncashed for six months, Fidelity may reinvest your distributions at the
then-current NAV. All subsequent distributions will then be reinvested
until you provide Fidelity with alternate instructions.
DIVIDENDS. Dividends from the Portfolio will not normally qualify for the
dividends-received deduction available to corporations, since the
Portfolio's income is primarily derived from interest income and short-term
capital gains. Depending upon state law, a portion of the Portfolio's
dividends attributable to interest income derived from U.S. government
securities may be exempt from state and local taxation. The Portfolio will
provide information on the portion of the Portfolio's dividends, if any,
that qualify for this exemption.
CAPITAL GAIN DISTRIBUTIONS. The Portfolio may distribute short-term capital
gains once a year or more often as necessary to maintain its NAV at $1.00
per share or to comply with distribution requirements under federal tax
law. The Portfolio does not anticipate earning long-term capital gains on
securities held by the Portfolio.
TAX STATUS OF THE PORTFOLIO. The Portfolio has qualified and intends to
qualify as a "regulated investment company" under the Internal Revenue Code
of 1986, as amended (the Code), so that the Portfolio will not be liable
for federal income or excise taxes on net investment income or capital
gains to the extent that these are distributed to shareholders in
accordance with applicable provisions of the Code.
STATE AND LOCAL TAX ISSUES. For mutual funds organized as business trusts,
state laws provide for a pass-through of the state and local income tax
exemption afforded to direct owners of U.S. government securities. Some
states limit this pass - through to mutual funds that invest a certain
amount in U.S. government securities, and some types of securities, such as
repurchase agreements and some agency-backed securities, but may not
qualify for this pass-through benefit. The tax treatment of your dividend
distributions from the Portfolio will be the same as if you directly owned
your proportionate share of the U.S. government securities held by the
Portfolio. Because the income earned on most U.S. government securities in
which the Portfolio invests is exempt form state and local taxes, the
portion of your dividends from the Portfolio attributable to these
securities will also be free from income taxes. The exemption from state
and local income taxation does not preclude states from assessing other
taxes on the ownership of U.S. government securities.
FMR
All of the stock of FMR is owned by FMR Corp. , its parent company
organized in 1972. Through ownership of voting common stock and the
execution of a shareholders' voting agreement, Edward C. Johnson 3d,
Johnson family members, and various trusts for the benefit of the Johnson
family form a controlling group with respect to FMR Corp .
At present, the principal operating activities of FMR Corp. are those
conducted by three of its divisions as follows: Fidelity Service Company
(FSC), which is the transfer and shareholder servicing agent for certain
funds advised by FMR; FIIOC, which performs shareholder servicing functions
for institutional customers and funds sold through
intermediaries ; and Fidelity Investments Retail Marketing Company, which
provides marketing services to various companies within the Fidelity
organization.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions. For example, all
personal trades in most securities require pre-clearance, and participation
in initial public offerings are prohibited. In addition, restrictions on
the timing of personal investing relative to trades by Fidelity funds and
on short-term trading have been adopted. Personal investing is monitored to
protect shareholders' interests.
TRUSTEES AND OFFICERS
The Board of Trustees and executive officers of the Trust are listed below.
Except as indicated, each individual has held the office shown or other
offices in the same company for the last five years. All persons named as
Trustees and officers also serve in similar capacities for other funds
advised by FMR. Unless otherwise noted, the business address of each
Trustee and officer is 82 Devonshire Street, Boston, MA 02109, which is
also the address of FMR. Those Trustees who are "interested persons" (as
defined in the 1940 Act) by virtue of their affiliation with either the
Trust or FMR, are indicated by an asterisk (*).
*EDWARD C. JOHNSON 3d, Trustee and President, is Chairman, Chief 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 FMR Texas
Inc. (1989), Fidelity Management & Research (U.K.) Inc., and Fidelity
Management & Research (Far East) Inc.
*J. GARY BURKHEAD, Trustee and Senior Vice President, is President of FMR;
and President and a Director of FMR Texas Inc. (1989), Fidelity Management
& Research (U.K.) Inc., and Fidelity Management & Research (Far East) Inc.
RALPH F. COX, 200 Rivercrest Drive, Fort Worth, TX, Trustee (1991), is a
consultant to Western Mining Corporation (1994). Prior to February 1994, he
was President of Greenhill Petroleum Corporation (petroleum exploration and
production, 1990). Until March 1990, Mr. Cox was President and Chief
Operating Officer of Union Pacific Resources Company (exploration and
production). He is a Director of Sanifill Corporation (non-hazardous waste,
1990) and CH2M Hill Companies (engineering). In addition, he served on the
Board of Directors of the Norton Company (manufacturer of industrial
devices, 1983-1990) and continues to serve on the Board of Directors of the
Texas State Chamber of Commerce, and is a member of advisory boards of
Texas A&M University and the University of Texas at Austin.
PHYLLIS BURKE DAVIS, P.O. Box 264, Bridgehampton, N.Y., Trustee (1992).
Prior to her retirement in September 1991, Mrs. Davis was the Senior Vice
President of Corporate Affairs of Avon Products, Inc. She is currently a
Director of BellSouth Corporation (telecommunications), Eaton Corporation
(manufacturing, 1991), and the TJX Companies, Inc. (retail stores, 1990),
and previously served as a Director of Hallmark Cards, Inc.
(1985-1991) and Nabisco Brands, Inc. In addition, she is a member of
the President's Advisory Council of The University School of Vermont School
of Business Administration.
RICHARD J. FLYNN, 77 Fiske Hill, Sturbridge, MA, Trustee, is a financial
consultant. Prior to September 1986, Mr. Flynn was Vice Chairman and a
Director of the Norton Company (manufacturer of industrial devices). He is
currently a Director of Mechanics Bank and a Trustee of College of the Holy
Cross and Old Sturbridge Village, Inc.
E. BRADLEY JONES, 3881-2 Lander Road, Chagrin Falls, OH, Trustee (1990).
Prior to his retirement in 1984, Mr. Jones was Chairman and Chief Executive
Officer of LTV Steel Company. Prior to May 1990, he was Director of
National City Corporation (a bank holding company) and National City Bank
of Cleveland. He is a Director of TRW Inc. (original equipment and
replacement products), Cleveland-Cliffs Inc. (mining), NACCO Industries,
Inc. (mining and marketing), Consolidated Rail Corporation, Birmingham
Steel Corporation, Hyster-Yale Materials Handling, Inc. (1989), and RPM,
Inc. (manufacturer of chemical products, 1990). In addition, he serves as a
Trustee of First Union Real Estate Investments, Chairman of the Board of
Trustees and a member of the Executive Committee of the Cleveland Clinic
Foundation, a Trustee and a member of the Executive Committee of University
School (Cleveland), and a Trustee of Cleveland Clinic Florida.
DONALD J. KIRK, 680 Steamboat Road, Apartment #1-North, Greenwich, CT,
Trustee, is a Professor at Columbia University Graduate School of Business
and a financial consultant. Prior to 1987, he was Chairman of the Financial
Accounting Standards Board. Mr. Kirk is a Director of General Re
Corporation (reinsurance) and Valuation Research Corp. (appraisals and
valuations, 1993). In addition, he serves as Vice Chairman of the Board of
Directors of the National Arts Stabilization Fund and the Vice Chairman of
the Board of Trustees of the Greenwich Hospital Association.
*PETER S. LYNCH, Trustee (1990) is Vice Chairman of FMR (1992). Prior to
his retirement on May 31, 1990, he was a Director of FMR (1989) 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, Inc. (1991-1992). He is a Director
of W.R. Grace & Co. (chemicals, 1989) and Morrison Knudsen Corporation
(engineering and construction). 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 (1990).
GERALD C. McDONOUGH, 135 Aspenwood Drive, Cleveland, OH, Trustee (1989), is
Chairman of G.M. Management Group (strategic advisory services). Prior to
his retirement in July 1988, he was Chairman and Chief Executive Officer of
Leaseway Transportation Corp. (physical distribution services). Mr.
McDonough is a Director of ACME-Cleveland Corp. (metal working,
telecommunications and electronic products), Brush-Wellman Inc. (metal
refining), York International Corp. (air-conditioning and refrigeration,
1989), Commercial Intertech Corp. (water treatment equipment, 1992), and
Associated Estates Realty Corporation (a real estate investment trust,
1993).
EDWARD H. MALONE, 5601 Turtle Bay Drive #2104, Naples, FL, Trustee. Prior
to his retirement in 1985, Mr. Malone was Chairman, General Electric
Investment Corporation and a Vice President of General Electric Company. He
is a Director of Allegheny Power Systems, Inc. (electric utility), General
Re Corporation (reinsurance) and Mattel Inc. (toy manufacturer). In
addition, he serves as a Trustee of Corporate Property Investors, the EPS
Foundation at Trinity College, the Naples Philharmonic Center for the Arts,
and Rensselaer Polytechnic Institute, and he is a member of the Advisory
Boards of Butler Capital Corporation Funds and Warburg, Pincus Partnership
Funds.
MARVIN L. MANN, 55 Railroad Avenue, Greenwich, CT, Trustee (1993) is
Chairman of the Board, President, and Chief Executive Officer of Lexmark
International, Inc. (office machines, 1991). 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) and Infomart (marketing services, 1991), a Trammell Crow Co. In
addition, he serves as a Campaign Vice Chairman of the Tri-State United Way
(1993) and is a member of the University of Alabama President's Cabinet
(1990).
THOMAS R. WILLIAMS, 21st Floor, 191 Peachtree Street, N.E., Atlanta, GA,
Trustee, is President of The Wales Group, 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 BellSouth Corporation (telecommunications),
ConAgra, Inc. (agricultural products), Fisher Business Systems, Inc.
(computer software), Georgia Power Company (electric utility), Gerber Alley
& Associates, Inc. (computer software), National Life Insurance Company of
Vermont, American Software, Inc. (1989), and AppleSouth, Inc. (restaurants,
1992).
GARY L. FRENCH, Treasurer (1991). Prior to becoming Treasurer of the
Fidelity funds, Mr. French was Senior Vice President, Fund Accounting -
Fidelity Accounting & Custody Services Co. (1991); Vice President, Fund
Accounting - Fidelity Accounting & Custody Services Co. (1990); and Senior
Vice President, Chief Financial and Operations Officer - Huntington
Advisers, Inc. (1985-1990).
JOHN H. COSTELLO, Assistant Treasuer, is an employee of FMR.
LEONARD M. RUSH, Assistant Treasurer (1994), is an empoyee of FMR
(1994). Prior becoming Assistant Treasuer of the Fidelity funds, Mr. Rush
was chief compliance Officer of FMR Corp. (1993-1994); Chief Financial
Officer of Fidelity Brokerage Services, Inc. (1990-1993); and Vice
President, Assistant Controller, and Director of the Accounting Department
- - First Boston Corp. (1986-1990).
ARTHUR S. LORING, Secretary, is Senior Vice President (1993) and
General Counsel of FMR, Vice President-Legal of FMR Corp., and Vice
President and Clerk of FDC .
FRED L. HENNING, JR., Vice President (1994), is Vice President of
Fidelity's money market funds and Senior Vice President of FMR Texas, Inc.
THOMAS D. MAHER, Assistant Vice President (1990), is Assistant Vice
President of Fidelity's money market funds and Vice President and Associate
General Counsel of FMR Texas (1990). Prior to 1990, Mr. Maher was an
employee of FMR and Assistant Secretary of all the Fidelity funds
(1985-1989).
LELAND BARRON, Vice President (1989) of the Portfolio and of other funds
advised by FMR and is an employee of FMR Texas.
Under a retirement program that became effective on November 1, 1989,
Trustees, upon reaching age 72, become eligible to participate in a defined
benefit retirement program under which they receive payments during their
lifetime from the Portfolio based on their basic trustee fees and length of
service. Currently, Messrs. Robert L. Johnson, William R. Spaulding,
Bertram H. Witham, and David L. Yunich participate in the program.
The Trustees and officers of the Trust, as a group, own less than 1% of the
Portfolio's outstanding shares.
MANAGEMENT AND SERVICE CONTRACTS
The Portfolio employs FMR to furnish investment advisory and other
services. Under its management contract with the Portfolio, FMR acts as
investment adviser and, subject to the supervision of the Board of
Trustees, directs the investments of the Portfolio in accordance with its
investment objective, policies and limitations. FMR also provides the
Portfolio with all necessary office facilities, equipment and personnel for
servicing the Portfolio's investments and compensates all officers of the
Trust, all Trustees who are "interested persons" of the Trust or of FMR,
and all personnel of the Trust 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
the Portfolio. These services include providing facilities for maintaining
the Portfolio's organization, supervising relations with custodians,
transfer and pricing agents, accountants, underwriters and other persons
dealing with the Portfolio; preparing all general shareholder
communications and conducting shareholder relations; maintaining the
Trust's records and the registration of the Portfolio's shares under
federal and state law; developing management and shareholder services for
the Portfolio; and furnishing reports, evaluations and analyses on a
variety of subjects to the Trustees on behalf of the Portfolio.
FMR pays all of the expenses of the Portfolio, except as described below.
Specific expenses payable by FMR include, without limitation, the fees and
expenses of registering and qualifying the Portfolio and its shares for
distribution under federal and state securities laws; expenses of
typesetting for printing the Prospectus and SAI; custodian charges;
auditing and legal expenses; insurance expenses; association membership
dues; the expense of reports to shareholders; shareholders' meetings; and
proxy solicitations.
FIIOC is transfer, dividend disbursing, and shareholders' servicing agent
for the Portfolio. The costs of these services are borne by FMR pursuant to
its management contract with the Portfolio. FSC calculates the
Portfolio's NAV and dividends, and maintains the Portfolio's general
accounting records. The costs of these services are also borne by FMR
pursuant to its management contract with the Portfolio.
FMR pays all other expenses of the Portfolio with the following exceptions:
the payment of fees and expenses of all Trustees of the Trust who are not
"interested persons" of the Trust or FMR; interest on borrowings; taxes;
brokerage commissions (if any); and such nonrecurring expenses as may
arise, including costs of litigation to which the Portfolio may be a party,
and any obligation it may have to indemnify its officers and Trustees with
respect to litigation.
For these services and FMR's payment of the portfolio's expenses, the
Portfolio pays a monthly management fee to FMR at the annual rate of .42%
of the average net assets of the Portfolio throughout the month pursuant to
a management contract approved by shareholders on December 8, 1994 .
The management fee paid to FMR is reduced by an amount equal to the fees
and expenses of those Trustees who are not "interested persons" of the
Trust or FMR. For the twelve month period ended August 31, 1994, August 31,
1993, and the ten month period ended August 31, 1992, the Portfolio paid
$6,336,847 , $5,622,803, and $3,902,635, in management fees,
respectively, before reduction for fees and expenses of the non-interested
Trustees.
SUB-ADVISER. On behalf of the Portfolio, FMR has entered into a
sub-advisory agreement with FMR Texas pursuant to which FMR Texas has
primary responsibility for providing portfolio investment management
services to the Portfolio. Under the sub-advisory agreement, FMR pays FMR
Texas fees equal to 50% of the management fee retained by FMR under its
current management contract with the Portfolio. The fees paid to FMR Texas
are not reduced by any voluntary or mandatory expense reimbursements that
may be in effect from time to time. For the twelve month periods ended
August 31, 1994 and August 31, 1993, and the ten month period ended August
31, 1992, FMR paid FMR Texas fees that amounted to $3,168,423 ,
$2,806,471, and $1,948,358, respectively.
The Portfolio 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. The Distribution Agreement
calls for FDC to use all reasonable efforts, consistent with its
other business, to secure purchasers for shares of the Portfolio, which are
continuously offered. Promotional and administrative expenses in connection
with the offer and sale of shares are paid by FMR.
DISTRIBUTION AND SERVICE PLAN
The Portfolio has adopted a Distribution and Service Plan (the Plan)
pursuant to Rule 12b-1 under the 1940 Act (the Rule). The Rule provides in
substance that a mutual fund may not engage directly or indirectly in
financing any activity that is primarily intended to result in the sale of
shares of the fund except pursuant to a plan adopted by the fund under the
Rule. The Trust's Board of Trustees has adopted the Plan to allow the
Portfolio and FMR to incur certain expenses that might be considered to
constitute indirect payment by the Portfolio of distribution expenses.
Under the Plan, if the payment of management fees by the Portfolio to FMR
is deemed to be indirect financing by the Portfolio of the distribution of
its shares, such payment is authorized by the Plan.
The Plan specifically recognizes that FMR, either directly or through
FDC , may use its management fee revenue, past profits or other
resources, without limitation, to pay promotional and administrative
expenses in connection with the offer and sale of shares of the Portfolio.
In addition, the Plan provides that FMR may use its resources, including
its management fee revenues, to make payments to third parties that provide
assistance in selling shares of the Portfolio or to third parties,
including banks, that render shareholder support services. The Trustees
have not authorized such payments to date.
As required by the Rule, the Trustees carefully considered all pertinent
factors relating to the implementation of the Plan prior to its approval,
and have determined that there is a reasonable likelihood that the Plan
will benefit the Portfolio and its shareholders. In particular, the
Trustees noted that the Plan does not authorize payments by the Portfolio
other than those made to FMR under its management contract with the
Portfolio. To the extent that the Plan gives FMR and FDC greater
flexibility in connection with the distribution of shares of the Portfolio,
additional sales of the Portfolio's shares may result. Additionally,
certain shareholder support services may be provided more effectively under
the plan by local entities with whom shareholders have other relationships.
The Plan was approved by Fidelity Money Market Trust on December 8 ,
1994, by the shareholder s of the Portfolio pursuant to an
Agreement and Plan of Conversion also approved by the
shareholders of the Portfolio on December 8 , 1994.
The Glass-Steagall Act generally prohibits federally and state chartered or
supervised banks from engaging in the business of underwriting, selling or
distributing securities. Although the scope of this prohibition under the
Glass-Steagall Act has not been clearly defined by the courts or
appropriate regulatory agencies, FDC believes that the Glass
Steagall Act should not preclude a bank from performing shareholder support
services, or servicing and recordkeeping functions. FDC intends to
engage banks only to perform such functions. However, changes in federal or
state statutes and regulations pertaining to the permissible activities of
banks and their affiliates or subsidiaries, as well as further judicial or
administrative decisions or interpretations, could prevent a bank from
continuing to perform all or a part of the contemplated services. If a bank
were prohibited from so acting, the Trustees would consider what actions,
if any, would be necessary to continue to provide efficient and effective
shareholder services. In such event, changes in the operation of the
Portfolio might occur, including possible termination of any automatic
investment or redemption or other services then provided by the bank. It is
not expected that shareholders would suffer any adverse financial
consequences as a result of any of these occurrences. In addition, state
securities laws on this issue may differ from the interpretations of
federal law expressed herein, and banks and financial institutions may be
required to register as dealers pursuant to state law.
The Portfolio 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.
DESCRIPTION OF THE TRUST
TRUST ORGANIZATION. Retirement Government Money Market Portfolio is a
portfolio of Fidelity Money Market Trust, an open-end management investment
company originally organized as a Massachusetts business trust on
August 21, 1978, and amended and restated November 1, 1989. On
December 29, 1994, the Trust was converted to a Delaware business trust
pursuant to an agreement approved by shareholders on December 8 ,
1994. The Delaware trust, which was organized on June 20, 1991 under the
name of Fidelity Money Market Trust I I, succeeded to the name
Fidelity Money Market Trust on December 29 , 1994. Currently there
are five portfolios of the Trust: U.S. Treasury Portfolio; U.S. Government
Portfolio; Domestic Money Market Portfolio; Retirement Money Market
Portfolio; and Retirement Government Money Market Portfolio. The Trust
Instrument permits the Trustees to create additional series.
In the event that FMR ceases to be the investment adviser to the
P ortfolio, the right of the Trust or P ortfolio to use the
identifying name "Fidelity" may be withdrawn.
The assets of the Trust, received for the issue or sale of shares of each
portfolio and all income, earnings, profits, and proceeds thereof, subject
only to the rights of creditors, are especially allocated to such
portfolio, and constitute the underlying assets of such portfolio. The
underlying assets of each portfolio are segregated on the books of account,
and are to be charged with the liabilities with respect to such portfolio
and with a share of the general expenses of the Trust. Expenses with
respect to the Trust are to be allocated in proportion to the asset value
of the respective portfolios, except where allocations of direct expense
can otherwise be fairly made. The officers of the Trust, subject to the
general supervision of the Board of Trustees, have the power to determine
which expenses are allocable to a given portfolio, or which are general or
allocable to all of the portfolios. In the event of the dissolution or
liquidation of the Trust, shareholders of each portfolio are entitled to
receive as a class the underlying assets of such portfolio available for
distribution.
SHAREHOLDER AND TRUSTEE LIABILITY. The Trust is a business trust organized
under Delaware law. Delaware law provides that shareholders shall be
entitled to the same limitations of personal liability extended to
stockholders of private corporations for profit. The courts of some states,
however, may decline to apply Delaware law on this point. The Trust
Instrument contains an express disclaimer of shareholder liability for the
debts, liabilities, obligations, and expenses of the Trust and requires
that a disclaimer be given in each contract entered into or executed by the
Trust or the Trustees. The Trust Instrument provides for indemnification
out of each portfolio's property of any shareholder or former shareholder
held personally liable for the obligations of the portfolio. The Trust
Instrument also provides that each portfolio shall, upon request, assume
the defense of any claim made against any shareholder for any act or
obligation of the portfolio and satisfy any judgment thereon. Thus, the
risk of a shareholder incurring financial loss on account of shareholder
liability is limited to circumstances in which Delaware law does not apply,
no contractual limitation of liability was in effect, and a portfolio is
unable to meet its obligations. FMR believes that, in view of the above,
the risk of personal liability to shareholders is remote.
The Trust Instrument further provides that the Trustees, if they have
exercised reasonable care, will not be liable to any person other than the
Trust or its shareholders; moreover, the Trustees shall not be liable for
any conduct whatsoever provided that Trustees are not protected against any
liability to which they would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence, or reckless disregard of the
duties involved in the conduct of their office.
VOTING RIGHTS. The P ortfolio's capital consists of shares of
beneficial interest. As a shareholder, you receive one vote for each dollar
of net asset value you own. The shares have no preemptive or conversion
rights; the voting and dividend rights, the right of redemption, and the
privilege of exchange are described in the Prospectus. Shares are fully
paid and nonassessable, except as set forth under the heading "Shareholder
and Trustee Liability" above. Shareholders representing 10% or more of the
Trust or a portfolio may, as set forth in the Trust Instrument, call
meetings of the Trust or a portfolio for any purpose related to the Trust
or portfolio, as the case may be, including, in the case of a meeting of
the entire Trust, the purpose of voting on removal of one or more Trustees.
The Trust or any portfolio may be terminated upon the sale of its assets
to, or merger with, another open-end management investment company, or upon
liquidation and distribution of its assets. Generally such terminations
must be approved by vote of the holders of a majority of the Trust or the
portfolio, as determined by the current value of each shareholder's
investment in the portfolio or Trust; however, the Trustees may, without
prior shareholder approval, change the form of organization of the Trust by
merger, consolidation, or incorporation. If not so terminated or
reorganized, the Trust and each portfolio will continue indefinitely.
Under the Trust Instrument, the Trustees may, without shareholder vote,
cause the Trust to merge or consolidate into one or more Trusts,
partnerships, or corporations, or cause the Trust to be incorporated under
Delaware law, so long as the surviving entity is an open-end management
investment company that will succeed to or assume the Trust's registration
statement. Each portfolio may invest all of its assets in another
investment company.
CUSTODIAN. Morgan Guaranty Trust Company of New York, 60 Wall Street, New
York, NY, is custodian of the assets of the Portfolio. The custodian is
responsible for the safekeeping of the Trust's assets and the appointment
of subcustodian banks and clearing agencies. The custodian takes no part in
determining the investment policies of the Portfolio or in deciding which
securities are purchased or sold by the Portfolio. The Portfolio, however,
may invest in obligations of the custodian and may purchase securities from
or sell securities to the custodian.
FMR, its officers and directors and its affiliated companies and the
Trust's Trustees may from time to time have transactions with various
banks, including banks serving as custodians for certain of the portfolios
advised by FMR. 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 these transactions were not influenced by
existing or potential custodial or other Portfolio relationships.
AUDITOR. Coopers & Lybrand L.L.P. serves as the Trust's independent
accountant. The auditor examines financial statements for the Portfolio and
provides other audit, tax, and related services.
FINANCIAL STATEMENTS
The Portfolio's financial statements and financial highlights for the
fiscal year ended August 31, 1994 are included in the Portfolio's Annual
Report, which is a separate report supplied with this SAI. The Portfolio's
financial statements and financial highlights are incorporated herein by
reference.
FIDELITY MONEY MARKET TRUST
RETIREMENT GOVERNMENT MONEY MARKET PORTFOLIO
ANNUAL REPORT
AUGUST 31, 1994
FIDELITY MONEY MARKET TRUST: RETIREMENT GOVERNMENT MONEY MARKET PORTFOLIO
INVESTMENTS/AUGUST 31, 1994
(Showing Percentage of Total Value of Investments)
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Federal Agencies - 60.6%
EXPORT IMPORT BANK, U.S. - AGENCY COUPONS - 0.8%
9/15/94 4.81% (a) $ 14,000,000 $ 14,000,000 530993AA
FEDERAL FARM CREDIT BANK - AGENCY COUPONS - 3.1%
10/3/94 3.36 17,000,000 17,000,347 313993JQ
10/3/94 3.38 17,000,000 17,000,000 313993JR
11/1/94 4.70 19,000,000 19,001,492 313993QU
53,001,839
FEDERAL FARM CREDIT BANK - DISCOUNT NOTES - 2.0%
10/3/94 4.62 9,500,000 9,498,443 313993QV
10/12/94 4.27 25,000,000 24,880,986 313993PC
34,379,429
FEDERAL HOME LOAN BANK - AGENCY COUPONS - 4.1%
9/1/94 5.33 (a) 24,000,000 23,961,746 313389U9
9/8/94 4.75 (a) (b) 27,000,000 26,926,290 3133893S
10/27/94 4.63 (a) 18,100,000 18,093,563 313390EP
68,981,599
FEDERAL HOME LOAN MORTGAGE CORP. - DISCOUNT NOTES - 1.2%
11/28/94 4.18 20,000,000 19,802,000 355993RM
FEDERAL NATIONAL MORTGAGE ASSOC. - AGENCY COUPONS - 10.4%
9/1/94 4.83 (a) 96,000,000 96,000,000 31364A2L
9/1/94 5.35 (a) 59,000,000 59,000,000 9931287F
10/11/94 4.61 22,900,000 23,028,255 9950094W
178,028,255
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 35.3%
9/7/94 4.50 22,000,000 21,983,647 995009XX
9/8/94 3.30 30,000,000 29,981,158 9931287E
9/19/94 4.04 20,000,000 19,960,500 9931304S
9/22/94 3.33 53,000,000 52,899,212 9931286H
9/23/94 4.01 14,465,000 14,430,348 9931304Q
10/4/94 4.27 42,000,000 41,839,070 995009AN
10/6/94 4.19 32,000,000 31,872,133 995009ER
10/25/94 3.40 36,000,000 35,821,260 9931286J
10/26/94 4.46 38,000,000 37,746,878 995009HH
11/29/94 4.87 45,000,000 44,471,562 995009QE
12/1/94 4.85 65,000,000 64,222,835 995009TF
12/29/94 4.99 50,000,000 49,193,444 9950093K
1/3/95 5.04 24,000,000 23,593,280
1/6/95 5.05 24,000,000 23,583,440 995009YB
1/17/95 5.03 26,000,000 25,511,633 9950094H
1/18/95 5.03 17,000,000 16,678,369 9950094C
1/18/95 5.08 15,000,000 14,712,733 9950094X
3/1/95 5.12 30,000,000 29,247,342 9950099P
3/6/95 4.97 25,000,000 24,358,043 9950099W
602,106,887
STUDENT LOAN MARKETING ASSOC. - AGENCY COUPONS - 3.7%
9/6/94 5.05% (a) $ 35,000,000 $ 35,000,000 863990PS
6/30/95 5.48 (a) 27,900,000 27,900,000 863990PT
62,900,000
TOTAL FEDERAL AGENCIES 1,033,200,009
U.S. Treasury Obligations - 1.2%
U.S. TREASURY BILLS
10/20/94 3.36 21,000,000 20,906,247 993134GV
MATURITY
AMOUNT
Repurchase Agreements - 38.2%
With Credit Lyonnais:
At 4.80%, dated 8/31/94 due 9/1/94:
U.S. Treasury Obligations
(principal amount $152,255,000)
6.125%, 7/31/96 $ 150,020,000 150,000,000 227993WH
With Goldman, Sachs & Co.:
At 4.75%, dated 8/30/94 due 9/6/94:
U.S. Government Obligations
(principal amount $84,460,000)
3.805% to 5.97%,
6/1/24 to 4/1/34 82,075,736 82,000,000 38199MKK
With Nomura Securities International, Inc.:
At 4.75%, dated 8/23/94 due 9/6/94:
U.S. Government Obligations
(principal amount $64,342,016)
7.125% to 9.25%,
4/15/21 to 7/15/28 61,112,681 61,000,000 69699BYN
In a joint trading account
(U.S. Government Obligations)
dated 8/31/94, due 9/1/94
(Notes 2 and 3)
At 4.89% 358,039,650 357,991,000 99799NWR
TOTAL REPURCHASE AGREEMENTS 650,991,000
TOTAL INVESTMENTS - 100% $ 1,705,097,256
Total Cost for Income Tax Purposes - $1,705,097,256
LEGEND:
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due date on these types of
securities reflects the next interest rate reset date or when applicable,
the final maturity date.
(b) Security purchased on a delayed delivery basis. Interest rate to be
determined at settlement date (see Note 2 of Notes to Financial
Statements).
INCOME TAX INFORMATION:
At August 31, 1994, the fund had a capital loss carryforward of
approximately $229,000 of which $4,000, $47,000 and $178,000 will expire on
August 31, 2000, 2001 and 2002, respectively.
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
August 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $650,991,000) - See accompanying $ 1,705,097,256
schedule
Interest receivable 2,803,099
TOTAL ASSETS 1,707,900,355
LIABILITIES
Payable for investments purchased $ 24,358,042
Regular delivery
Delayed delivery 26,926,290
Share transactions in process 611,227
Dividends payable 7,168
Accrued management fee 593,567
TOTAL LIABILITIES 52,496,294
NET ASSETS $ 1,655,404,061
Net Assets consist of:
Paid in capital $ 1,655,535,709
Accumulated net realized gain (loss) on investments (131,648)
NET ASSETS, for 1,655,535,709 shares outstanding $ 1,655,404,061
NET ASSET VALUE, offering price and redemption price per share ($1,655,404,061 (divided by) 1,655,535,709 $1.00
shares)
</TABLE>
Statement of Operations
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended August 31, 1994
INTEREST INCOME $ 55,458,151
EXPENSES
Management fee $ 6,327,789
Non-interested trustees' fees 9,058
TOTAL EXPENSES 6,336,847
NET INTEREST INCOME 49,121,304
NET REALIZED GAIN (LOSS) ON (178,268)
INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 48,943,036
</TABLE>
Statement of Changes in Net Assets
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED AUGUST 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 49,121,304 $ 38,836,205
Net interest income
Net realized gain (loss) (178,268) (47,007)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 48,943,036 38,789,198
Dividends to shareholders from net interest income (49,121,304) (38,836,205)
Share transactions at net asset value of $1.00 per share 1,170,902,583 1,323,450,636
Proceeds from sales of shares
Reinvestment of dividends from net interest income 48,866,605 38,836,205
Cost of shares redeemed (957,770,324) (1,205,185,320)
Net increase (decrease) in net assets and shares resulting
from share transactions 261,998,864 157,101,521
TOTAL INCREASE (DECREASE) IN NET ASSETS 261,820,596 157,054,514
NET ASSETS
Beginning of period 1,393,583,465 1,236,528,951
End of period $ 1,655,404,061 $ 1,393,583,465
</TABLE>
FINANCIAL HIGHLIGHTS
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C> <C>
<C> <C>
YEARS ENDED AUGUST 31, TEN MONTHS YEARS ENDED OCTOBER 31,
ENDED
AUGUST 31,
1994 1993 1992 1991 1990
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations .032 .029 .034 .061 .079
Net interest income
Less Distributions (.032) (.029) (.034) (.061) (.079)
From net interest income
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 3.27% 2.95% 3.47% 6.29% 8.16%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 1,655,404 $ 1,393,583 $ 1,236,529 $ 936,869 $ 410,889
Ratio of expenses to average net assets .42% .42% .42%A .42% .42%
Ratio of net interest income to average net
assets 3.26% 2.90% 4.08%A 5.98% 7.85%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31 1994
1. SIGNIFICANT ACCOUNTING POLICIES.
Retirement Government Money Market Portfolio (the fund) is a fund of
Fidelity Money Market Trust (the trust) and is authorized to issue an
unlimited number of shares. The trust is registered under the Investment
Company Act of 1940, as amended (the 1940 Act), as an open-end management
investment company organized as a Massachusetts business trust. The
following summarizes the significant accounting policies of the fund:
SECURITY VALUATION. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost and
thereafter assume a constant amortization to maturity of any discount or
premium.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
REPURCHASE AGREEMENTS. The fund, through its custodian, receives delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. The fund's investment
adviser, Fidelity Management & Research Company (FMR), is responsible for
determining that the value of these underlying securities remains at least
equal to the resale price.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other affiliated
entities of FMR, may transfer uninvested cash balances into one or more
joint trading accounts. These balances are invested in one or more
repurchase agreements that mature in 60 days or less from the date of
purchase, and are collateralized by U.S. Treasury or Federal Agency
obligations.
DELAYED DELIVERY TRANSACTIONS. The fund may purchase or sell securities on
a when-issued or forward commitment basis. Payment and delivery may take
place a month or more after the date of the transaction. The price of the
underlying securities and the date when the securities will be delivered
and paid for are fixed at the time the transaction is negotiated. The fund
may receive compensation for interest forgone in a delayed delivery
transaction. The fund identifies securities as segregated in its custodial
records with a value at least equal to the amount of the purchase
commitment.
3. JOINT TRADING ACCOUNT.
At the end of the period, the fund had 20% or more of its total investments
in repurchase agreements through a joint trading account. These repurchase
agreements were with entities whose creditworthiness has been reviewed and
found satisfactory by FMR. The repurchase agreements were dated August 31,
1994 and due September 1, 1994. The maturity values of the joint trading
account investments were $358,039,650 at 4.89%. The investments in
repurchase agreements through the joint trading account are summarized as
follows:
3. JOINT TRADING ACCOUNT - CONTINUED
MAXIMUM
AMOUNT AGGREGATE AGGREGATE AGGREGATE
NO. OF WITH ONE PRINCIPAL MATURITY MARKET COUPON MATURITY
DEALERS DEALER AMOUNT OF AMOUNT OF VALUE OF RATES OF DATES OF
OR BANKS OR BANK AGREEMENTS AGREEMENTS COLLATERAL COLLATERAL COLLATERAL
At 4.89% 4 42.9% $1,750,000,000 $1,750,237,819 $1,801,920,348 0%-13.5%
9/1/94-4/1/34
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR pays all expenses
except the compensation of the non-interested Trustees and certain
exceptions such as interest, taxes, brokerage commissions and extraordinary
expenses. FMR receives a fee that is computed daily at an annual rate of
.42% of the fund's average net assets.
SUB-ADVISER FEE. As the fund's investment sub-adviser, FMR Texas Inc., a
wholly owned subsidiary of FMR, receives a fee from FMR of 50% of the
management fee payable to FMR. The fee is paid prior to any voluntary
expense reimbursements which may be in effect, and after reducing the fee
for any payments by FMR pursuant to the fund's Distribution and Service
Plan.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Money Market Trust and the Shareholders of
Retirement Government Money Market Portfolio:
We have audited the accompanying statement of assets and liabilities of
Fidelity Money Market Trust: Retirement Government Money Market Portfolio,
including the schedule of portfolio investments, as of August 31, 1994, and
the related statement of operations for the year then ended, the statement
of changes in net assets for each of the two years in the period then
ended, and the financial highlights for each of the two years in the period
then ended, the ten month period ended August 31, 1992, and for each of the
two years in the period ended October 31, 1991. These financial statements
and financial highlights are the responsibility of the Trust's management.
Our responsibility is to express an opinion on these financial statements
and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of August 31, 1994 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of the Fidelity Money Market Trust: Retirement Government Money Market
Portfolio as of August 31, 1994, the results of its operations for the year
then ended, the changes in its net assets for each of the two years in the
period then ended, and the financial highlights for each of the two years
in the period then ended, for the ten month period ended August 31, 1992,
and for each of the two years in the period ended October 31, 1991, in
conformity with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Dallas, Texas
September 23, 1994
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL INFORMATION OF THE
SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUND UNLESS
PRECEDED OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS. MUTUAL FUND SHARES ARE
NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE
FDIC, THE FEDERAL RESERVE BOARD OR ANY
OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISK, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL. NEITHER THE FUND NOR
FIDELITY DISTRIBUTORS CORPORATION IS A BANK. FOR MORE INFORMATION ON ANY
FIDELITY FUND INCLUDING CHARGES AND
EXPENSES, CALL 1-800-544-0276 FOR A FREE PROSPECTUS. READ IT CAREFULLY
BEFORE YOU INVEST OR SEND MONEY.
REGIONAL OFFICES
NEW ENGLAND REGION
82 Devonshire Street
Boston, MA 02109
MIDWESTERN REGION
11 South LaSalle Street
Suite 810
Chicago, IL 60603
First Center Office Plaza
26955 Northwestern Highway
Suite 175
Southfield, MI 48037
MID-ATLANTIC REGION
150 East 52nd Street
Suite 2400
New York, NY 10022
One Tower Bridge
100 Front Street
Suite 1050
West Conshohocken, PA 19428
WESTERN REGION
1800 Avenue of the Stars
Suite 130
Los Angeles, CA 90067
455 Market Street
Suite 1420
San Francisco, CA 94105
SOUTHEASTERN REGION
1960 Landings Boulevard
Landings Office Park
Suite D104
Sarasota, FL 34231
1 Atlantic Place
950 East Paces Ferry Road NE
Suite 2915
Atlanta, GA 30326
SOUTHWESTERN REGION
1010 Lamar
Suite 975
Houston, TX 77002
400 East Las Colinas Boulevard
Canal Plaza
Irving, TX 75039
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
SUB-ADVISER
FMR Texas Inc.
Irving, TX
TRUSTEES
J. Gary Burkhead
Ralph F. Cox
Phyllis Burke Davis
Richard J. Flynn
Edward C. Johnson 3d
E. Bradley Jones
Donald J. Kirk
Peter S. Lynch
Edward H. Malone
Marvin L. Mann
Gerald C. McDonough
Thomas R. Williams
OFFICERS
Edward C. Johnson 3d, PRESIDENT
J. Gary Burkhead, SENIOR VICE PRESIDENT
Fred L. Henning, Jr., VICE PRESIDENT
Leland Barron, VICE PRESIDENT
Thomas D. Maher, ASSISTANT VICE PRESIDENT
Gary L. French, TREASURER
John H. Costello, ASSISTANT TREASURER
Leonard M. Rush, ASSISTANT TREASURER
Arthur S. Loring, SECRETARY
CUSTODIAN
Morgan Guaranty Trust Company of New York
New York, NY
TRANSFER AND
SHAREHOLDER
SERVICING AGENT
Fidelity Investments Institutional
Operations Company
Boston, MA
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA RGM-10-94A
FIDELITY MONEY MARKET TRUST:
RETIREMENT MONEY MARKET PORTFOLIO
CROSS REFERENCE SHEET
Form N-1A Item Number
<TABLE>
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Part A Prospectus Caption
1 Cover Page
2 Summary of Portfolio Expenses
3 a, b Financial Highlights
c Performance
4 a(i) The Trust and the Fidelity Organization
a(ii), b, c Investment Objectives; Investment Policies, Risks and
Limitations;
Suitability
5 a The Trust and the Fidelity Organization
b, c, d, e The Trust and the Fidelity Organization;
Management Contract, Distribution and Service Plan; How to
Invest, Exchange and Redeem
f Portfolio Transactions
5A a, b, c *
6 a(i) The Trust and the Fidelity Organization
a(ii) How to Invest, Exchange and Redeem
a(iii), b, c, d *
e Cover Page; How to Invest, Exchange and Redeem
f, g How to Invest, Exchange and Redeem;
Distribution and Taxes
7 a Management Contract, Distribution and
Service Plan
b(i, ii) How to Invest, Exchange and Redeem
b(iii, iv *
b(v) How to Invest, Exchange and Redeem
c *
d How to Invest, Exchange and Redeem
e, f (i, ii) Management Contract, Distribution and
Service Plan
f (iii) *
8 a, b, c, d How to Invest, Exchange and Redeem
9 *
</TABLE>
* Not Applicable
Form N-1A Item Number
<TABLE>
<CAPTION>
<S> <C>
Part B Statement of Additional Information
10,11 Cover Page
12 Description of the Trust
13 a,b,c Investment Policies, Risks and Limitations
d *
14 a,b Trustees and Officers
c *
15 a, b Description of the Trust
c Trustees and Officers
16 a(i) FMR
a(ii) Trustees and Officers
a(iii), b Management Contract; Distribution and Service Plan
c, d, e *
f Distribution and Service Plan
g *
h Description of the Trust
i Management Contract; Distribution and Service Plan
17 a Portfolio Transactions
b *
c Portfolio Transactions
d, e *
18 a Description of the Trust
b *
19 a Additional Purchase and Redemption Information
b Valuation of Portfolio Securities
c *
20 Taxes
21 a(i,ii) Management Contract; Distribution and Service Plan
a(iii),b,c *
22 Performance
23 Financial Statements for the Portfolios' fiscal year ended August
31, 1994 are incorporated by reference into the Statement of
Additional Information.
</TABLE>
* Not Applicable
FIDELITY MONEY MARKET TRUST: 82 DEVONSHIRE STREET
Retirement Money Market Portfolio BOSTON, MASSACHUSETTS 02109
PROSPECTUS
Retirement Money Market Portfolio (the Portfolio) is a diversified
portfolio of Fidelity Money Market Trust (the Trust). The Portfolio seeks
to obtain as high a level of current income as is consistent with the
preservation of capital and liquidity by investing in high quality money
market instruments.
AN INVESTMENT IN THE PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT THE PORTFOLIO WILL
MAINTAIN A STABLE $1.00 SHARE PRICE.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION. SHARES
ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY,
AND ARE SUBJECT TO INVESTMENT
RISK, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
The Portfolio is generally intended for investors in tax-saving retirement
plans. This Prospectus is designed to provide you with information before
investing and to help you decide if the Portfolio's goals match your own.
Please read and retain this document for future reference.
To learn more about the Portfolio and its investments, you can obtain a
copy of the Portfolio's most recent financial report and portfolio listing,
or a copy of the Statement of Additional Information (SAI) dated December
29 , 1994. The SAI has been filed with the Securities and Exchange
Commission (SEC) and is incorporated herein by reference. For a free copy
of either document, call the appropriate number below.
RETIREMENT PLAN ACCOUNTS - NATIONWIDE (TOLL FREE) 800-544-0276
FINANCIAL AND OTHER INSTITUTIONS - NATIONWIDE (TOLL FREE) 800-843-3001
If you are investing through a retirement plan sponsor or other
institution, refer to your plan materials or contact the institution
directly.
TABLE OF CONTENTS
Summary of Portfolio Expenses
Financial Hi ghlights
Investment Objective
Investment Policies, Risks and Limitations
How to Invest, Exchange and Redeem
Distributions and Taxes
Portfolio Transactions
Performance
Management Contract, Distribution and Service Plan
The Trust and the Fidelity Organization
Appendix
LIKE ALL MUTUAL FUNDS, THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
5.SUMMARY OF PORTFOLIO EXPENSES
The purpose of the table below is to assist investors in understanding the
various costs and expenses that an investor in the Portfolio would bear
directly or indirectly. This standard format was developed for use by all
mutual funds to help investors make their investment decisions. This
expense information should be considered along with other important
information, such as the Portfolio's investment objective and past
performance. There are no transaction expenses associated with purchases or
sales of the Portfolio's shares.
A. ANNUAL OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees .42%
Other Expenses .00
TOTAL OPERATING EXPENSES .42%
B. EXAMPLE: You would pay the following expenses on a $1,000 investment,
assuming (1) a 5% annual return and (2) redemption at the end of each time
period:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
$4 $13 $24 $53
6.EXPLANATION OF TABLE
A. ANNUAL OPERATING EXPENSE S are based on the Portfolio's
historical expenses . Management fees are paid by the
Portfolio to Fidelity Management & Research Company (FMR) for managing its
investments and business affairs. FMR is responsible for the payment of all
of the expenses of the Portfolio with the exception of certain limited
expenses. Please refer to the section "Management Contract,
Distribution and Service Plan" on page for further information.
B. EXAMPLE . The hypothetical example illustrates the expenses
associated with a $1,000 investment over periods of 1, 3, 5 and 10 years,
based on the expenses in the table and an assumed annual rate of return of
5%. THE RETURN OF 5% AND EXPENSES SHOULD NOT BE CONSIDERED
INDICATIONS OF ACTUAL OR EXPECTED PORTFOLIO PERFORMANCE OR EXPENSES, BOTH
OF WHICH MAY VARY.
7.FINANCIAL HIGHLIGHTS
The table that follows is included in the Portfolio's Annual Report
and has been audited by Coopers & Lybrand L.L.P., independent accountants.
Their report on the financial statements and financial highlights is
included in the Annual Report. The financial statements and financial
highlights are incorporated by reference into the Portfolio's SAI.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Years Ended August 31 Ten Months Years Ended October 31 December 2,
Ended 1988
August 31, (commenceme
nt of
operations) to
October 31
SELECTED PER-SHARE DATA 1994 1993 1992 1991 1990 1989
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations .034 .030 .035 .063 .080 .079
Net interest income
Less Distributions (.034) (.030) (.035) (.063) (.080) (.079)
From net interest income
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURNB 3.41% 3.09% 3.50% 6.52% 8.27% 8.14%
Ratios and Supplemental Data
Net assets, end of period (000 omitted) $ 2,799,925 $ 1,705,966 $ 1,516,346 $ 1,287,650 $ 622,774 $ 117,497
Ratio of expenses to average net assets .42% .42% .42% .42% .42% .42%
Ratio of net interest income to average
net 3.44% 3.05% 4.12%A 6.19% 7.95% 9.00%A
assets
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
8.INVESTMENT OBJECTIVE
Retirement Money Market Portfolio's investment objective is to obtain as
high a level of current income as is consistent with the preservation of
capital and liquidity by investing in money market instruments. FMR will
buy obligations for the Portfolio consistent with its investment objective,
and which meet the quality and maturity standards established for the
Portfolio. The Portfolio's investment objective is fundamental and may not
be changed without the affirmative vote of a majority of the outstanding
shares of the Portfolio. No assurance can be made that the Portfolio will
achieve its objective, but it will follow the investment style described in
the following paragraphs.
9.INVESTMENT POLICIES, RISKS AND LIMITATIONS
The Portfolio invests in high quality, U.S. dollar-denominated money market
instruments of U.S. and foreign issuers which present minimal credit risk,
including:
(solid bullet) Obligations of governments and their agencies or
instrumentalities ;
(solid bullet) Obligations of the financial services industry, including
banks, savings and loan institutions, insurance companies and mortgage
bankers. These obligations include certificates of deposit, bankers'
acceptances and time deposits ;
(solid bullet) Short-term corporate obligations, including commercial
paper, notes and bonds ; and
(solid bullet) Other short-term money market obligations.
The Portfolio may engage in repurchase agreements with respect to such
obligations. The Portfolio also may invest in restricted securities and may
engage in reverse repurchase agreements and in short sales against the box.
Please refer to the Appendix for more information on the Portfolio's
investments.
QUALITY AND MATURITY. Pursuant to procedures adopted by the Board of
Trustees, the Portfolio may purchase only high quality securities that FMR
believes present minimal credit risks. To be considered high quality, a
security must be rated in accordance with applicable rules in one of the
two highest categories for short-term securities by at least two
nationally recognized rating services (or by one, if only one
rating service has rated the security); or, if unrated, judged to be of
equivalent quality by FMR.
High quality securities are divided into "first tier" and "second tier"
securities. FIRST TIER SECURITIES are those deemed to be in
the highest rating category (e.g., Standard & Poor's A-1).
SECOND TIER SECURITIES are those deemed to be in the
second highest rating category (e.g., Standard & Poor's
A-2 ).
The Portfolio may not invest more than 5% of its total assets in second
tier securities. In addition, the Portfolio may not invest more than 1% of
its total assets or $1 million (whichever is greater) in the second tier
securities of a single issuer.
The Portfolio currently intends to limit its investments to securities with
remaining effective maturities of 397 days or less and to maintain a
dollar-weighted average maturity of 90 days or less. When determining
the maturity of a security, the Portfolio may look to an interest rate
reset or demand feature.
The Portfolio may invest in obligations of U.S. banks, foreign branches of
U.S. banks (Eurodollars), U.S. branches and agencies of foreign banks
(Yankee dollars), and foreign branches of foreign banks. Euro and Yankee
dollar investments involve risks that are different from investments in
securities of U.S. banks. These risks may include future unfavorable
political and economic developments, withholding taxes, seizures of foreign
deposits, currency controls, interest limitations or other governmental
restrictions that might affect payment of principal or interest.
Additionally, there may be less public information available about foreign
banks and their branches. Foreign branches of foreign banks are not
regulated by U.S. banking authorities, and generally are not bound by
accounting, auditing and financial reporting standards comparable to U.S.
banks. Although FMR carefully considers these factors when making
investments, the Portfolio does not limit the amount of its assets which
can be invested in any one type of instrument or in any one foreign
country.
INVESTMENT LIMITATIONS. The following summarizes the Portfolio's
principal investment limitations. As a non-fundamental policy, the
Portfolio may invest up to 10% of its net assets in illiquid
investments. A complete listing is contained in the SAI.
1. (a) With respect to 75% of its total assets, the Portfolio may not
invest more than 5% in the securities of any issuer (other
than U.S. government securities). (b) Under certain conditions, however,
the Portfolio may invest up to 25% of its total assets in the first tier
securities of a single issuer for up to three business days;
2. The Portfolio may not purchase the securities of any issuer (other than
U.S. government securities) if, as a result, more than 25% of its total
assets would be invested in the securities of issuers whose principal
business activities are in the same industry, except that the Portfolio
intends to invest more than 25% of its total assets in obligations of
institutions in the financial services industry.
3. (a) The Portfolio ( i ) may borrow money for temporary or emergency
purposes and ( ii ) engage in reverse repurchase agreements for any
purpose ; provided that ( i ) and ( ii ) in combination do
not exceed 33 1/3% of its total assets . (b) The Portfolio may not
purchase securities when borrowings (other than reverse repurchase
agreements) exceed 5% of its total assets.
4. The Portfolio may make loans to other parties, but not in excess
of 33 1/3% of its total asset s.
Except for the Portfolio's investment objective, investment limitations
1(a), 2, 3(a), and 4, the investment policies described in this
Prospectus are not fundamental and may be changed without shareholder
approval. Except for the percentage limitation in 3(a) these investment
limitations and policies are considered at the time of purchase; the sale
of securities is not required in the event of a subsequent change in
circumstances.
Because the Portfolio concentrates more than 25% of its total assets in the
financial services industry, its performance may be affected by conditions
affecting banks and other financial services companies. Companies in the
financial services industry are subject to various risks related to that
industry, such as governmental regulations, changes in interest rates, and
exposure on loans, including loans to foreign borrowers. Investments in the
financial services industry may include obligations of foreign and domestic
banks, savings and loan associations, consumer and industrial finance
companies, securities brokerage companies, leasing companies, and a variety
of firms in the insurance field.
SUITABILITY. The Portfolio's ability to achieve its
investment objective depends on the quality and maturity of its
investments. Although the Portfolio's policies are designed to help
maintain a stable $1.00 share price, all money market instruments can
change in value when interest rates or issuers' creditworthiness change, or
if an issuer or guarantor of a security fails to pay interest or principal
when due. If these changes in value were large enough, the Portfolio's
share price could fall below $1.00. In general, securities with longer
maturities are more vulnerable to price changes, although they may provide
higher yields.
If you seek income at current money market rates while remaining
conveniently liquid, the Portfolio may be appropriate for you. It has the
flexibility to invest in corporate and bank instruments. The Portfolio
generally is designed for investors in tax-saving retirement plans such as
Defined Contribution Plans, 403(b) Custodial Accounts, Defined Benefit
Plans and 457 Plans. Minimum investments for these plans may differ from
those listed on page 6.
By itself, the Portfolio does not constitute a balanced investment plan;
its objective stresses income with preservation of capital and liquidity,
and not the higher yields or capital appreciation that may be available
from more aggressive investments.
10.HOW TO INVEST, EXCHANGE AND REDEEM
Shares of the Portfolio are offered continuously and may be purchased at
the next determined net asset value per share (NAV), after an order is
received and accepted. The Portfolio's shares are sold without a sales
charge. The NAV of the Portfolio is determined by adding the value of all
securities and other assets of the Portfolio, deducting its actual and
accrued liabilities, and dividing by the number of shares outstanding. The
Portfolio values its securities on the basis of amortized cost. Fidelity
Service Co. (Service), calculates the NAV at the close of the Portfolio's
business day, which coincides with the close of business of the New York
Stock Exchange (NYSE), normally 4:00 p.m. Eastern Time . (See "Holiday
Schedule" on page .) You begin to earn dividends as of the first
business day following the day of your purchase.
MINIMUM INVESTMENT AND ACCOUNT BALANCE. The minimum initial
investment to establish a new account in the Portfolio is $100,000.
Subsequent investments may be in any amount. To keep an account
open, a minimum balance of $100,000 must be maintained . If
your account balance falls below $100,000 due to redemption, the
portfolio may close the account and mail the proceeds to you at the
record address. You will be given 30 days' notice that your account will be
closed unless you make an additional investment to increase your account
balance to the $100,000 minimum. The minimum investment requirements may
differ or may not apply to participants of tax-saving retirement plans.
If you are purchasing shares of the Portfolio through a program of services
offered by a securities dealer, financial or other institution, you should
read the program materials in conjunction with this Prospectus. Certain
features of the Portfolio may be modified in these programs and
administrative charges may be imposed for the services rendered.
If you invest in this Portfolio through an employer-sponsored retirement
plan, some of the instructions, shareholder services and phone numbers that
follow will not apply. Speak to your institutional representative for
additional information.
HOW TO INVEST. An initial investment in the Portfolio must be
preceded or accompanied by a completed, signed application. Additional
paperwork may be required from corporations, associations and certain
fiduciaries.
TO INVEST BY MAIL. You must send a check payable to Fidelity Money
Market Trust: Retirement Money Market Portfolio, together with a completed
application, to:
Fidelity Money Market Trust:
Retirement Money Market Portfolio
c/o Fidelity Institutional Retirement Services Company
P.O. Box 650488
Dallas, TX 75265-0488
All of your purchases must be made in U.S. dollars, and checks must be
drawn on U.S. banks. No cash will be accepted. If you make a purchase with
more than one check, each check must have a value of at least $50, and the
minimum investment requirement still applies. The Portfolio reserves the
right to limit the number of checks processed at one time. If your check
does not clear, your purchase will be canceled and you could be held liable
for any losses and/or fees incurred.
TO INVEST BY WIRE. You may purchase shares of the Portfolio by wire.
The Portfolio requires notification of all wire purchases. Prior to making
an initial investment, investors must call the institution through which
they trade or:
(solid bullet) RETIREMENT PLAN ACCOUNTS: call Retirement Trading at
1-800-962-1375 for wire information and instructions, by the close of the
Portfolio's business day ( 4:00 p.m.) to advise them of the wire and
to place the trade.
(solid bullet) FINANCIAL AND OTHER INSTITUTIONS: call Client
Services at 1-800-843-3001 for wire information and instructions by the
close of the Portfolio's business day (4:00 p.m.) to advise them of the
wire and to place the trade.
In addition to the Portfolio's Holiday Schedule (see page ), shares cannot
be purchased by wire on Dr. Martin Luther King, Jr. Day (observed),
Columbus Day (observed), Veterans' Day (observed) or during any unscheduled
closings of the Federal Reserve Wire System.
Investments made by wire receive the NAV next determined as of the day the
order is received if federal funds, or monies immediately convertible to
federal funds, are received by the following business day prior to the
close of the NYSE (normally 4:00 p.m. Eastern Time ).
It is recommended that investors wire funds early in the day to ensure
proper credit.
11. HOW TO EXCHANGE. An exchange is a convenient way to buy shares of
the Portfolio or other Fidelity funds. The Fidelity family of funds has a
variety of investment objectives. You may exchange shares of this Portfolio
for shares of other Fidelity funds (subject to the minimum initial
investment requirement) that are registered in your state. When making an
exchange, the name, address and tax identification numbers of the two
accounts must be identical. Investors must consult the prospectus of the
fund to be acquired to determine eligibility and suitability. To protect
the Portfolio's performance and shareholders, Fidelity discourages frequent
trading in response to short-term market fluctuations. In particular,
exchanges that coincide with "market timing" strategies can have adverse
effects on the Portfolio.
You may exchange all or any part of the value of your accounts on any
business day. There is currently no limit on exchanges out of the
Portfolio; however, exchange limits may apply to other funds. Exchanges may
be requested in writing or by telephone and are effected at the NAV next
determined after receipt of the exchange request. If you exchange into a
fund with a sales charge, you pay the percentage difference between that
fund's sales charge and any sales charge you already have paid in
connection with the shares you are exchanging. This may not apply if you
are investing through a tax-saving retirement plan.
Each exchange actually represents the sale of shares of one fund and the
purchase of shares in another, which may produce a gain or loss for tax
purposes. A confirmation of each exchange transaction will be sent to you.
In order to allow FMR to manage the Portfolio most effectively, you are
strongly urged to initiate exchanges of shares as early in the day as
possible.
TO EXCHANGE BY TELEPHONE. Exchanges may be requested by calling:
RETIREMENT PLAN ACCOUNTS 800-962-1375
FINANCIAL AND OTHER INSTITUTIONS 800-843-3001
TO EXCHANGE BY MAIL. Written requests for exchanges should contain
the Portfolio name, account number and number of shares to be redeemed, and
the name of the fund whose shares are being purchased. The request must be
signed by a person authorized to act on behalf of the account. Letters
should be sent to:
Fidelity Money Market Trust:
Retirement Money Market Portfolio
c/o Fidelity Institutional Retirement Services Company
P.O. Box 650488
Dallas, TX 75265-0488
The Portfolio reserves the right at any time without prior notice to refuse
exchange purchases by any person or group if, in FMR's judgment, the
Portfolio would be unable to invest effectively in accordance with its
investment objective and policies or would otherwise potentially be
adversely affected. The Portfolio may terminate or modify the exchange
privilege in the future.
HOW TO REDEEM. You may redeem all or a portion of your shares on any
business day. Your shares will be redeemed at the next determined NAV
calculated after the Portfolio has received and accepted your redemption
request. When you redeem shares, the Portfolio normally will send you the
proceeds on the next business day. Shares will earn dividends through the
date of redemption; however, shares redeemed on a Friday or prior to a
holiday will continue to earn dividends until the next business day. The
Portfolio may hold payment on redemptions until it is reasonably satisfied
that investments made by check have been collected (which could take up to
seven days).
TO REDEEM BY WIRE. The wiring of redemption proceeds is available
only to investors who have previously established a wire account. In
addition to the Portfolio's Holiday Schedule (see page ), shares cannot be
redeemed by wire on Dr. Martin Luther King, Jr. Day (observed), Columbus
Day (observed), Veterans' Day (observed) or during any unscheduled closings
of the Federal Reserve Wire System .
TO REDEEM BY MAIL. Send a letter of instruction with your
signature(s) guaranteed to the address given above. The letter should
specify the name of the Portfolio, the number of shares to be redeemed,
your name, your account number, and should include the additional
requirements listed below that apply to your particular account.
<TABLE>
<CAPTION>
<S> <C>
Type of Registration Requirements
Individual, Joint Tenant, Sole Proprietorship, Letter of instruction signed by all person(s) required
Custodial (Uniform Gifts or Transfers to Minors to sign for the account exactly as it is registered,
Act), General Partners accompanied by signature guarantee(s).
Corporations, Associations Letter of instruction and a corporate resolution,
signed by person(s) required to sign for the account
accompanied by signature guarantee(s).
Trusts A letter of instruction signed by the Trustee(s) with
signature guarantee(s). (If the Trustee's name is not
registered on the account, also provide a copy of the
trust document, certified within the last 60 days.)
</TABLE>
If you do not fall into any of these registration categories, (e.g.,
Executors, Administrators, Conservators, Guardians) please call Client
Administration for further instructions.
A signature guarantee is a widely accepted way to protect you and Fidelity
Investments Institutional Operations Company (FIIOC) by verifying the
signature on your redemption request; it may not be provided by a notary
public. Signature guarantees will be accepted from banks, brokers, dealers,
municipal securities dealers, municipal securities brokers, government
securities dealers, government securities brokers, credit unions (if
authorized under state law), national securities exchanges, registered
securities associations, clearing agencies and savings associations.
TO REDEEM BY TELEPHONE. You may redeem shares of the Portfolio by
instructing FIIOC to have the proceeds of redemptions wired directly to
your designated bank account(s). To redeem by telephone call FIIOC before
4:00 p.m. Eastern Time :
RETIREMENT PLAN ACCOUNTS 800-962-1375
FINANCIAL AND OTHER INSTITUTIONS 800-843-3001
Provided that your account registration has not changed within the last 30
days, you may redeem shares of the Portfolio worth $100,000 or less by
calling the applicable telephone number listed above. Redemption
proceeds will be sent to the record address.
If making immediate payment could adversely affect the Portfolio, it may
take up to seven (7) days to pay you. Also, when the NYSE is closed (or
when trading is restricted) for any reason other than its customary weekend
or holiday closings, or under any emergency circumstances as determined by
the SEC to merit such action, the Portfolio may suspend redemption or
postpone payment dates. If you are unable to execute your transaction by
telephone (for example, during times of unusual market activity) consider
placing your order by mail.
In order to allow FMR to manage the Portfolio most effectively, investors
are strongly urged to initiate redemptions of shares as early in the day as
possible and to notify the Portfolio at least one day in advance of large
redemptions.
ADDITIONAL INFORMATION. You may initiate many transactions by
telephone. Fidelity may only be liable for losses resulting from
unauthorized transactions if it does not follow reasonable procedures
designed to verify the identity of the caller. Fidelity will request
personalized security codes or other information, and may also record
calls. You should verify the accuracy of the confirmation statements
immediately after receipt. If you do not want the ability to redeem and
exchange by telephone, call Fidelity for instructions. Additional
documentation may be required from corporations, associations and certain
fiduciaries.
The Portfolio reserves the right to suspend the offering of shares for a
period of time. The Portfolio also reserves the right to reject any
specific purchase order, including certain purchases by exchange (see "How
to Exchange" on page ). Purchase orders may be refused if, in FMR's
opinion, they are of a size that would disrupt management of the Portfolio.
12.SHAREHOLDER SERVICES
TAX-SAVING RETIREMENT PLANS. Fidelity can set up your new account in
the Portfolio under one of several tax-sheltered plans. These plans let you
save for retirement and shelter your investment income from current taxes.
Minimums may differ from those listed on page and the corresponding
information may not apply. Retirement plan participants should refer to
their retirement plan's guidelines for further information.
(solid bullet) DEFINED CONTRIBUTION PLANS such as 401(k), company
sponsored IRA programs, Thrift, Keogh or Corporate Profit-Sharing or
Money-Purchase Plans are open to self-employed people and their
partners or to corporations, to benefit themselves and their employees.
(solid bullet) 403(B) CUSTODIAL ACCOUNTS are open to
employees of most non-profit organizations.
(solid bullet) DEFINED BENEFIT PLANS are open to corporations of all
sizes to benefit their employees.
(solid bullet) 457 PLANS are open to employees of most
government agencies.
13.CHOOSING A DISTRIBUTION OPTION
When you fill out the application for your account, you can choose from two
distribution options:
A. The SHARE OPTION reinvests your distributions in additional
shares. You are assigned this option automatically if you make no choice on
your application.
B. The INCOME-EARNED OPTION distributes all dividends in cash to
you.
Participants in the above mentioned tax-saving retirement plans can elect
to take their distributions in kind and establish an IRA rollover account
in the Portfolio.
SUBACCOUNTING AND SPECIAL SERVICES. Special processing has been
arranged with FIIOC for banks, corporations and other institutions that
wish to open multiple accounts (a master account and subaccounts). An
investor wishing to utilize FIIOC's subaccounting facilities or other
special services for individual or multiple accounts may be required to
enter into a separate agreement with FIIOC. Charges for these services, if
any, will be determined on the basis of the level of services to be
rendered. Subaccounts may be opened with the initial investment or at a
later date and may be established by an investor with a registration either
by name or by number.
The Portfolio pays for shareholder services, but not for special services,
such as a request for a historical transcript of an account. You may be
required to pay a fee for these special services.
STATEMENTS AND REPORTS. The Portfolio will send a statement of your
account after every transaction that affects your share balance or your
account registration. The Portfolio does not issue share certificates.
Dividend statements are mailed quarterly. At least twice a year you will
receive financial statements of the Portfolio. To reduce expenses, only one
copy of most fund reports (such as the Portfolio's Annual Report) will be
mailed to your household. Write to the Portfolio if you need to have
additional reports sent .
FIDELITY INVESTMENTS RATES AND YIELDS SERVICES LINE is Fidelity's
around-the-clock telephone service that lets existing customers use a
push - button phone with tone capabilities to obtain prices and yields
of their Fidelity funds. For more information about this service
contact Client Administration .
14. HOLIDAY SCHEDULE. The Portfolio is open for business and its NAV
is calculated each day the NYSE is open for trading. The NYSE has
designated the following holiday closings for 1995 : New Year's
Day (observed), Presidents' Day, Good Friday, Memorial Day ,
Independence Day , Labor Day, Thanksgiving Day, and Christmas
Day . Although FMR expects the same holiday schedule to be observed
in the future, the NYSE may modify its holiday schedule at any time. On any
day that the NYSE closes early, or as permitted by the SEC, or on any day
that the principal government securities markets close early, such as on
days in advance of holidays generally observed by participants in such
markets, the right is reserved to advance the time on that day by which
purchase and redemption requests must be received. To the extent that
portfolio securities are traded in other markets on days that the NYSE is
closed, the Portfolio's NAV may be affected on days when investors do not
have access to the Portfolio to purchase or redeem shares. Certain Fidelity
funds may follow different holiday schedules.
15.DISTRIBUTIONS AND TAXES
The Portfolio ordinarily declares dividends from net investment income
daily and pays such dividends monthly. The Portfolio intends to distribute
substantially all of its net investment income and capital gains, if any,
to shareholders within each calendar year as well as on a fiscal year
basis.
FEDERAL TAXES. Dividends derived from net investment income and
short-term capital gains are taxable as ordinary income. The Portfolio's
distributions are taxable when they are paid, whether you take them in cash
or reinvest them in additional shares, except that distributions declared
in December and paid in January are taxable as if paid on December 31. The
Portfolio will send you an Internal Revenue Service (IRS) Form 1099-DIV by
January 31 showing your taxable distributions for the past calendar year.
OTHER TAX INFORMATION. The information above is only a summary of
some of the federal tax consequences generally affecting the Portfolio and
its shareholders, and no attempt has been made to discuss individual tax
consequences. In addition to federal tax, shareholders may be subject to
state or local taxes on their investments. Investors should consult their
tax advisors for details and up-to-date information on the tax laws in
their states.
When you sign your account application, you will be asked to certify that
your Social Security or taxpayer identification number is correct and that
you are not subject to 31% backup withholding for failing to report income
to the IRS. If you violate IRS regulations, the IRS can require the
Portfolio to withhold 31% of your taxable distributions and
redemptions . Your tax situation may be different if you are investing
through a tax-saving retirement plan. Contact your tax advisor or
plan administrator for further information.
16.PORTFOLIO TRANSACTIONS
Money market obligations generally are traded in the over-the-counter
market through broker-dealers. A broker-dealer is a securities firm or bank
which makes a market for securities by offering to buy at one price and
sell at a slightly higher price. The difference between the prices is known
as a spread. Since FMR trades, directly or through affiliated sub-advisers,
a large number of securities, including those of Fidelity's other funds,
broker-dealers are willing to work with the Portfolio on a more favorable
spread than would be possible for most individual investors.
The Portfolio has authorized FMR to allocate transactions to some
broker-dealers who help distribute the shares of the Portfolio or shares of
other Fidelity funds to the extent permitted by law, and on
an agency basis to an affiliate, Fidelity Brokerage Services, Inc. (FBSI).
FMR will allocate such transactions if commissions are comparable to those
charged by non-affiliated , qualified broker-dealers for similar
services.
Higher commissions may be paid to those firms that provide research
services to the extent permitted by law. FMR also is authorized to allocate
brokerage transactions to FBSI in order to secure from FBSI research
services produced by third party, independent entities. FMR may use this
research information in managing the Portfolio's assets, as well as assets
of other clients.
17.PERFORMANCE
The Portfolio advertises its YIELD and EFFECTIVE YIELD in
advertisements or in reports or other communications to shareholders. Both
yield figures are based on historical earnings and are not intended to
indicate future performance.
The Portfolio's yield refers to the income generated by an investment in
the Portfolio over a seven-day period expressed as an annual percentage
rate. The Portfolio also may calculate an EFFECTIVE YIELD by
compounding the base period return over a one-year period. The effective
yield, although calculated similarly, will be slightly higher than the
yield because it assumes that income earned from the investment is
reinvested (i.e. the compounding effect of reinvestment). In addition to
the current yield, the Portfolio may quote yields in advertising based on
any historical seven day period. For the seven-day period ended August 31,
1994, the Portfolio's yield was 4.36% and its effective yield was
4.45 %.
The Portfolio's TOTAL RETURN is based on the overall dollar or
percentage change in value of a hypothetical investment in the Portfolio
and assumes all distributions are reinvested.
A CUMULATIVE TOTAL RETURN reflects the Portfolio's performance over
a stated period of time.
An AVERAGE ANNUAL TOTAL RETURN reflects the hypothetical annually
compounded rate that would have produced the same cumulative total return
if the Portfolio's performance had been constant over the entire period.
Because average annual returns tend to smooth out variations in the
Portfolio's return, investors should recognize that they are not the same
as actual year-by-year results.
18.MANAGEMENT CONTRACT, DISTRIBUTION AND SERVICE PLAN
MANAGEMENT CONTRACT. For managing its investments and business
affairs, the Portfolio pays a monthly management fee to FMR at the annual
rate of .42% of the average net assets of the Portfolio throughout the
month. FMR pays all expenses of the Portfolio with the following
exceptions: the payment of fees and expenses of all Trustees of the Trust
who are not "interested persons" of the Trust or FMR; brokerage fees or
commissions (if any); interest on borrowings; taxes; and such extraordinary
non-recurring expenses as may arise, including litigation to which the
Portfolio may be a party. The management fee will be reduced by the fees
and expenses of those Trustees who are not "interested persons" of the
Trust paid by the Portfolio. For the fiscal year ended August 31, 1994, the
Portfolio paid FMR $9,381,317 in management fees before reduction
for the fees and expenses of the non-interested members of the Board of
Trustees.
FMR has entered into a sub-advisory agreement with FMR Texas Inc. (FMR
Texas), under which FMR Texas has primary responsibility for providing
portfolio investment management services, while FMR retains responsibility
for providing other management services. Under the terms of the agreement,
FMR pays FMR Texas fees equal to 50% of the management fees payable to FMR
under its current management contract with the Portfolio. The fees paid to
FMR Texas are not reduced by any voluntary or mandatory expense
reimbursements that may be in effect from time to time.
FIIOC performs transfer agency, dividend disbursing and shareholder
servicing functions for the Portfolio. Service calculates the Portfolio's
NAV and dividends, and maintains the Portfolio's general accounting
records. The costs of providing these services are borne by FMR pursuant to
its management contract with the Portfolio. Both FIIOC and Service are
affiliates of FMR.
FMR may, from time to time, agree to reimburse the Portfolio for expenses
above a specific percentage of average net assets. FMR retains the ability
to be repaid by the Portfolio for these expense reimbursements in the
amount that expenses fall below the limit prior to the end of the fiscal
year. Fee reimbursements by FMR will increase the Portfolio's yield, and
subsequent repayment by the Portfolio will lower its yield.
DISTRIBUTION AND SERVICE PLAN. The Board of Trustees, on behalf of
the Portfolio, has adopted a Distribution and Service Plan (the Plan)
pursuant to Rule 12b-1 (the Rule) under the Investment
Company Act of 1940 (1940 Act). The Rule provides in substance that a
mutual fund may not engage directly or indirectly in financing any activity
that is intended primarily to result in the sale of shares of the fund
except pursuant to a plan adopted by the fund under the Rule. No separate
payments are authorized to be made by the Portfolio under the Plan. Rather,
the Plan recognizes that FMR may use its management fee or other resources
to pay expenses associated with activities primarily intended to result in
the sale of the Portfolio's shares.
19. THE 20.TRUST AND THE FIDELITY ORGANIZATION
The Portfolio is a diversified portfolio of Fidelity Money Market Trust, an
open-end management investment company organized as a Delaware business
trust by a Trust Instrument dated December 29, 1994. The Trust's
Board of Trustees supervises Trust activities and reviews its
contractual arrangements with companies that provide the Portfolio with
services. The Trust is not required to hold annual shareholder meetings,
although special meetings may be called for a specific Portfolio or the
Trust as a whole for purposes such as electing or removing Trustees,
changing fundamental investment policies or approving a new or amended
management contract. As a shareholder, the number of votes you are entitled
to is based upon the dollar value of your investment.
Fidelity Investments is one of America's largest investment management
organizations and has its principal business address at 82 Devonshire
Street, Boston, MA 02109 . It includes a number of different
companies which provide a variety of financial services and
products. The Trust employs various Fidelity companies to perform certain
activities required for its operation.
FMR , the Portfolio's adviser, is the original Fidelity company,
founded in 1946. FMR provides a number of mutual funds and other
clients with investment research and portfolio management services. FMR
maintains a large staff of experienced investment personnel and a full
complement of related support facilities. As of October 31 , 1994,
FMR advised funds having more than 21 million shareholder accounts
with a total value of more than $250 billion. Fidelity Distributors
Corporation (Distributors) distributes shares for the Fidelity funds.
FMR Corp. is the ultimate parent company of FMR and FMR Texas. Through
ownership of voting common stock, members of the Edward C. Johnson 3d
family form a controlling group with respect to FMR Corp. Changes may occur
in the Johnson family group, through death or disability, which would
result in changes in each individual family members' holding of stock. Such
changes could result in one or more family members becoming holders of over
25% of the stock. FMR Corp. has received an opinion of counsel that changes
in the composition of the Johnson family group under these circumstances
would not result in the termination of the Portfolios' management or
distribution contracts and, accordingly, would nor require a shareholder
vote to continue operation under those contracts.
21.APPENDIX
The following paragraphs provide a brief description of securities in which
the Portfolio may invest and transactions it may make. The Portfolio is not
limited by this discussion, however, and may purchase other types of
securities and enter into other types of transactions if they are
consistent with the Portfolio's investment objectives and policies.
A complete listing of the Portfolio's policies and limitations and more
detailed information about the Portfolio's investments are contained in the
Portfolio's SAI. Current holdings and recent investment strategies are
described in the Portfolio's financial report, which is sent to
shareholders twice a year.
ASSET-BACKED SECURITIES include interests in pools of
mortgages, loans, receivables or other assets. Payment of principle and
interest may be largely dependent upon the cash flows generated by the
assets backing the securities.
BANKERS' ACCEPTANCES are negotiable obligations of a bank to pay a
draft which has been drawn on it by a customer. These obligations are drawn
on large banks and usually backed by goods in international trade.
CERTIFICATES OF DEPOSIT are negotiable certificates representing a
commercial bank's obligations to repay funds deposited with it, earning
special rates of interest over a given period of time.
COMMERCIAL PAPER are short-term obligations issued by banks,
broker-dealers, corporations and other entities for purposes such as
financing their current operations.
CORPORATE OBLIGATIONS are bonds and notes issued by corporations and
other business organizations in order to finance their credit needs.
DELAYED DELIVERY TRANSACTIONS. The Portfolio may buy and sell
securities on a when-issued or delayed delivery basis, with payment and
delivery taking place at a future date. The market value of securities
purchased in this way may change before the delivery date, which could
affect the market value of the Portfolio's assets. Ordinarily, the
Portfolio will not earn interest on securities purchased until they are
delivered.
ILLIQUID INVESTMENTS. Under the supervision of the Board of
Trustees, FMR determines the liquidity of the Portfolio's investments. The
absence of a trading market can make it difficult to ascertain a market
value for illiquid investments. Disposing of illiquid investments may
involve time-consuming negotiation and legal expenses, and it may be
difficult or impossible for the Portfolio to sell illiquid
investments promptly at an acceptable price.
INTERFUND BORROWING PROGRAM. The Portfolio has received permission
from the SEC to lend money to and borrow money from other funds advised by
FMR or its affiliates. Interfund loans and borrowings normally will extend
overnight, but can have a maximum duration of seven days. The Portfolio
will lend through the program only when the returns are higher than those
available at the same time from other short-term instruments (such as
repurchase agreements), and will borrow through the program only when the
costs are equal to or lower than the cost of bank loans. The Portfolio will
not lend more than 10% of its assets to other funds, and will not borrow
through the program if, after doing so, total outstanding borrowings would
exceed 15% of total assets. Loans may be called on one day's notice, and
the Portfolio may have to borrow from a bank at a higher interest rate if
an interfund loan is called or not renewed. Any delay in repayment to a
lending fund could result in a lost investment opportunity or additional
borrowing costs.
MUNICIPAL OBLIGATIONS are issued to raise money for various public
purposes, including general purpose financing for state and local
governments as well as financing for specific projects or public
facilities. Municipal obligations may be backed by the full taxing power of
a municipality or by the revenues from a specific project or the credit of
a private organization.
REPURCHASE AGREEMENTS. In a repurchase agreement, the Portfolio buys
a security at one price and simultaneously agrees to sell it back at a
higher price. Delays or losses could result if the other party to the
agreement defaults or becomes insolven t.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement,
the Portfolio sells a portfolio instrument to another party, such as
a bank or broker-dealer, in return for cash. At the same time, the
Portfolio agrees to repurchase the instrument at an agreed upon price and
date. The Portfolio expects that it will engage in reverse repurchase
agreements for temporary purposes such as funding redemptions , or
when it is able to invest the cash so acquired at a rate higher than the
cost of the agreement, which would increase the income earned by the
Portfolio. Reverse repurchase agreements may increase the risk of
fluctuation in the market value of the Portfolio's assets or its yield.
RESTRICTED SECURITIES cannot be sold to the public without
registration under the Securities Act of 1933. Unless registered for sale,
these securities can only be sold in privately negotiated transactions or
pursuant to an exemption from registration.
TIME DEPOSITS are non-negotiable deposits in a banking institution
earning a specified interest rate over a given period of time.
U.S. GOVERNMENT OBLIGATIONS are securities issued or guaranteed by
the U.S. Treasury or by an agency or instrumentality of the U.S.
government. Not all U.S. government obligations are backed by the full
faith and credit of the United States. For example, securities issued by
the Federal Home Loan Banks or by the Federal National Mortgage Association
are supported by the agency's right to borrow money from the U.S. Treasury
under certain circumstances. However, securities issued by the Financing
Corporation are supported only by the credit of the agency that issued
them. There is no guarantee that the government will support these types of
securities, and therefore they involve more risk than other government
obligations.
STRIPPED SECURITIES are the separate income or
principal components of a debt instrument. These involve risks that are
similar to those of other debt securities, although they may be more
volatile, and certain stripped securities move in the same direction as
interest rates.
VARIABLE OR FLOATING RATE SECURITIES have interest rates
that are periodically adjusted either at specific intervals or whenever a
benchmark rate changes. These interest rate adjustments are designed to
help stabilize the security's price.
ZERO COUPON BONDS do not make regular interest payments. Instead,
they are sold at a deep discount from their face value. In calculating its
daily dividend, the Portfolio takes into account as income a portion of the
difference between a zero coupon bond's purchase prices and its face
values. Because they do not pay current income, the prices of zero coupon
bonds can be very volatile when interest rates change.
RETIREMENT MONEY MARKET PORTFOLIO
A PORTFOLIO OF FIDELITY MONEY MARKET TRUST
STATEMENT OF ADDITIONAL INFORMATION
DECEMBER 29 , 1994
This Statement of Additional Information (SAI) is not a prospectus but
should be read in conjunction with the Portfolio's current Prospectus and
Annual Report (dated December 2 9 , 1994). Please retain this document
for future reference. To obtain an additional copy of the Portfolio's
Prospectus and Annual Report, please call:
RETIREMENT PLAN ACCOUNTS 800-544-0276
FINANCIAL AND OTHER INSTITUTIONS 800-843-3001
TABLE OF CONTENTS PAGE
Investment Policies and Limitations
Portfolio Transactions
Valuation of Portfolio Securities
Performance
Additional Purchase and Redemption Information
Distribution and Taxes
FMR
Trustees and Officers
Management and Service Contracts
Distribution and Service Plan
Description of the Trust
Financial Statements
Appendix
INVESTMENT ADVISER
Fidelity Management & Research Company (FMR)
SUB-ADVISER
FMR Texas Inc. (FMR Texas)
DISTRIBUTOR
Fidelity Distributors Corporation (FDC )
TRANSFER AGENT
Fidelity Investments Institutional Operations Company (FIIOC)
CUSTODIAN
Morgan Guaranty Trust Company of New York
RMM-PTB-1294
INVESTMENT POLICIES AND LIMITATIONS
The following policies and limitations supplement those set forth in the
Prospectus. Unless otherwise noted, whenever an investment policy or
limitation states a maximum percentage of the Portfolio's assets that may
be invested in any security or other asset, or sets forth a policy
regarding quality standards, such standard or percentage limitation will be
determined immediately after and as a result of the Portfolio's acquisition
of such security or other asset. Accordingly, any subsequent change in
values, net assets or other circumstances will not be considered when
determining whether the investment complies with the Portfolio's investment
policies and limitations.
The Portfolio's fundamental investment policies and limitations can not be
changed without approval by a "majority of the outstanding voting
securities" (as defined in the Investment Company Act of 1940 (1940 Act))
of the Portfolio. However, except for the fundamental investment
limitations set forth below, the investment policies and limitations
described in this SAI are not fundamental and may be changed without
shareholder approval. THE FOLLOWING ARE THE PORTFOLIO'S FUNDAMENTAL
INVESTMENT LIMITATIONS SET FORTH IN THEIR ENTIRETY. THE PORTFOLIO MAY NOT:
(1) with respect to 75% of the Portfolio's total assets, purchase the
security of any issuer (other than obligations issued or guaranteed by the
government of the United States, its agencies or instrumentalities) if, as
a result thereof: (a) more than 5% of the Portfolio's total assets would be
invested in the securities of such issuer; or (b) the Portfolio would hold
more than 10% of the voting securities of such issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the Portfolio may (i) borrow money for
temporary or emergency purposes (not for leveraging or investment), and
(ii) engage in reverse repurchase agreements for any purpose; provided that
(i) and (ii) in combination do not exceed 33 1/3% of the Portfolio's total
assets (including the amount borrowed) less liabilities (other than
borrowings). Any borrowings that come to exceed this amount will be reduced
within three days (not including Sundays and holidays) to the extent
necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others (except to the extent that the
Portfolio may be deemed to be an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted securities);
(5) purchase the securities of any issuer (other than obligations issued
or guaranteed by the government of the United States, its agencies or
instrumentalities) if, as a result, more than 25% of the Portfolio's total
assets (taken at current value) would be invested in the securities of
issuers having their principal business activities in the same industry,
except that the Portfolio intends to invest more than 25% of total assets
in obligations of institutions in the financial services industry. Neither
finance companies as a group or utility companies as a group are considered
a single industry for purposes of this policy;
(6) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the
Portfolio from investing in securities or other instruments backed by real
estate or securities of companies engaged in the real estate business);
(7) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments; or
(8) lend any security or make any other loan if, as a result, more than 33
1/3% of the Portfolio's total assets would be lent to other parties, but
this limitation does not apply to purchases of debt securities or to
repurchase agreements.
(9) The Portfolio may, notwithstanding any other fundamental investment
policy or limitation, invest all of its assets in the securities of a
single open-end management investment company with substantially the same
fundamental investment objective, policies and limitations as the
Portfolio.
THE FOLLOWING LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED WITHOUT
SHAREHOLDER APPROVAL.
(i) The Portfolio does not currently intend to purchase a security (other
than a security issued or guaranteed by the U.S. government or any of its
agencies or instrumentalities) if, as a result, more than 5% of its total
assets would be invested in the securities of a single issuer; provided
that the Portfolio may invest up to 25% of its total assets in the first
tier securities of a single issuer for up to three business days.
(ii) The Portfolio may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an affiliate
serves as investment adviser or (b) by engaging in reverse repurchase
agreements with any party. The Portfolio will not purchase any security
while borrowings (excluding reverse repurchase agreements) representing
more than 5% of its total assets are outstanding. The Portfolio will not
borrow from other funds advised by FMR or its affiliates if total
outstanding borrowings immediately after such borrowing would exceed 15% of
the Portfolio's total assets.
(iii) The Portfolio does not currently intend to sell securities short,
unless it owns or has the right to obtain securities equivalent in kind and
amount to the securities sold short, and provided that transactions in
futures contracts and options are not deemed to constitute selling
securities short.
(iv) The Portfolio does not currently intend to purchase securities on
margin, except that the Portfolio may obtain such short-term credits as are
necessary for the clearance of transactions, and provided that margin
payments in connection with futures contracts and options on futures
contracts shall not constitute purchasing securities on margin.
(v) The Portfolio does not currently intend to purchase any security if, as
a result, 10% or more of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(vi) The Portfolio does not currently intend to purchase or sell futures
contracts or call options. This limitation does not apply to options
attached to, or acquired or traded together with, their underlying
securities, and does not apply to securities that incorporate features
similar to options or futures contracts.
(vii) The Portfolio does not currently intend to lend assets other than
securities to other parties, except by lending money (up to 10% of the
Portfolio's net assets) to a registered investment company or portfolio for
which FMR or an affiliate serves as investment adviser. (This limitation
does not apply to purchases of debt securities or to repurchase
agreements.)
(viii) The Portfolio does not currently intend to purchase the securities
of any issuer (other than securities issued or guaranteed by domestic or
foreign governments or political subdivisions thereof) if, as a result,
more than 5% of its total assets would be invested in the securities of
business enterprises that, including predecessors, have a record of less
than three years of continuous operation.
(ix) The Portfolio does not currently intend to invest in oil, gas, or
other mineral exploration or development programs or leases.
(x) The Portfolio does not currently intend to purchase the securities of
any issuer if those officers and Trustees of the Portfolio and those
officers and directors of FMR who individually own more than 1/2 of 1% of
the securities of such issuer together own more than 5% of such issuer's
securities.
(xi) The Portfolio does not currently intend to invest all of its assets in
the securities of a single open-end management investment company
managed by FMR or an affiliate or successor with the same
fundamental investment objective, policies, and limitations as the
Portfolio.
For the Portfolio's policies on quality and maturity, see the section
entitled "Quality and Maturity" on page .
AFFILIATED BANK TRANSACTIONS. The Portfolio may engage in transactions with
financial institutions that are, or may be considered to be, "affiliated
persons" of the Portfolio under the 1940 Act. These transactions may
include repurchase agreements with custodian banks; short-term obligations
of, and repurchase agreements with, the 50 largest U.S. banks (measured by
deposits); municipal securities; U.S. government securities with affiliated
financial institutions that are primary dealers in these securities;
short-term currency transactions; and short-term borrowings. In accordance
with exemptive orders issued by the Securities and Exchange Commission
(SEC), the Board of Trustees has established and periodically reviews
procedures applicable to transactions involving affiliated financial
institutions.
ASSET-BACKED SECURITIES. Asset-backed securities include pools of
mortgages, loans, receivables or other assets. Payment of principal
and interest may be largely dependent upon the cash flows generated by the
assets backing the securities, and, in certain cases, supported by letters
of credit, surety bonds, or other credit enhancements. The value of
asset-backed securities may also be affected by the creditworthiness of the
servicing agent for the pool, the originator of the loans or receivables,
or the financial institution(s) providing the credit support.
DOMESTIC AND FOREIGN ISSUERS. Investments may be made in U.S.
dollar-denominated time deposits, certificates of deposit , and
bankers' acceptances of U.S. banks and their branches located outside of
the United States, U.S. branches and agencies of foreign banks, and
foreign branches of foreign banks. The Portfolio also may invest in U.S.
dollar-denominated securities issued or guaranteed by other U.S. or foreign
issuers, including U.S. and foreign corporations or other business
organizations, foreign governments , foreign government agencies or
instrumentalities, and U.S. and foreign financial institutions, including
savings and loan institutions, insurance companies, mortgage bankers and
real estate investment trusts, as well as banks. The Portfolio may purchase
obligations of savings and loan institutions , insurance
companies, mortgage bankers, and real estate investment trusts, as well as
banks.
The obligations of foreign branches of U.S. banks may be general
obligations of the parent bank in addition to the issuing branch, or may be
limited by the terms of a specific obligation and by governmental
regulation. Payment of interest and principal upon these obligations may
also be affected by governmental action in the country of domicile of the
branch (generally referred to as sovereign risk). In addition, evidences of
ownership of portfolio securities may be held outside of the U.S. and the
Portfolio may be subject to the risks associated with the holding of such
property overseas. Various provisions of federal law governing the
establishment and operation of U.S. branches do not apply to foreign
branches of U.S. banks.
Obligations of U.S. branches and agencies of foreign banks may be
general obligations of the parent bank in addition to the issuing branch,
or may be limited by the terms of a specific obligation and by federal and
state regulation , as well as by governmental action in the country
in which the foreign bank has its head office.
Obligations of foreign issuers involve certain additional risks.
These risks may include future unfavorable political and economic
developments withholding taxes, seizures of foreign deposits, currency
controls, interest limitations or other governmental restrictions that
might affect payment of principal or interest. Additionally there may be
less public information available about foreign banks and their branches.
Foreign issuers may be subject to less governmental regulation and
supervision than U.S. issuers. Foreign issuers also generally are not bound
by uniform accounting, auditing and financial reporting requirements
comparable to those applicable to U.S. issuers.
DELAYED DELIVERY TRANSACTIONS. The Portfolio may buy and sell securities on
a delayed delivery or when-issued basis. These transactions involve a
commitment by the Portfolio to purchase or sell specific securities at a
predetermined price and/or yield, with payment and delivery taking place
after the customary settlement period for that type of security (and more
than seven days in the future). Typically, no interest accrues to the
purchaser until the security is delivered.
When purchasing securities on a delayed delivery basis, the Portfolio
assumes the rights and risks of ownership, including the risk of price and
yield fluctuations. Because the Portfolio is not required to pay for
securities until the delivery date, these risks are in addition to the
risks associated with the Portfolio's other investments. If the Portfolio
remains substantially fully invested at a time when delayed delivery
purchases are outstanding, the delayed delivery purchases may result in a
form of leverage. When delayed delivery purchases are outstanding, the
Portfolio will set aside appropriate liquid assets in a segregated
custodial account to cover its purchase obligations. When the Portfolio has
sold a security on a delayed delivery basis, the Portfolio does not
participate in further gains or losses with respect to the security. If the
other party to a delayed delivery transaction fails to deliver or pay for
the securities, the Portfolio could miss a favorable price or yield
opportunity, or could suffer a loss.
The Portfolio may renegotiate delayed delivery transactions after they are
entered into, and may sell underlying securities before they are delivered,
which may result in capital gains or losses.
REPURCHASE AGREEMENTS. In a repurchase agreement, the Portfolio
purchases a security and simultaneously commits to sell that security back
to the original seller at an agreed-upon price. The resale price reflects
the purchase price plus an agreed-upon incremental amount which is
unrelated to the coupon rate or maturity of the purchased security. While
it does not presently appear possible to eliminate all risks from these
transactions (particularly the possibility that the value of the underlying
security will be less than the resale price as well as delays and costs to
the Portfolio in connection with bankruptcy proceedings), it is the
Portfolio's current policy to engage in repurchase agreement transactions
with parties whose creditworthiness has been reviewed and found
satisfactory by FMR.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, the
Portfolio sells a portfolio instrument to another party, such as a bank or
a broker-dealer, in return for cash and agrees to repurchase the instrument
at a particular price and time. While a reverse repurchase agreement is
outstanding, the Portfolio will maintain appropriate liquid assets in a
segregated custodial account to cover its obligation under the agreement.
The Portfolio will enter into reverse repurchase agreements only with
parties whose creditworthiness has been found satisfactory by FMR. Such
transactions may increase fluctuations in the market value of the
Portfolio's assets and may be viewed as a form of leverage.
STRIPPED GOVERNMENT SECURITIES are created by separating the income and
principal components of a debt instrument and selling them separately. The
Portfolio may purchase U.S. Treasury STRIPS (Separate Trading of Registered
Interest and Principal of Securities) that are created when the
coupon payments and the principal payment are stripped from an outstanding
Treasury bond by the Federal Reserve Bank. Bonds issued by the Resolution
Funding Corporation (REFCORP) can also be stripped in this fashion. REFCORP
Strips are eligible investments for the Portfolio .
The Portfolio can purchase privately stripped government securities, which
are created when a dealer deposits a Treasury security or federal agency
security with a custodian for safekeeping and then sells the coupon
payments and principal payment that will be generated by this security.
Proprietary receipts, such as Certificates of Accrual on Treasury
Securities (CATS), Treasury Investment Growth Receipts (TIGRS), and generic
Treasury Receipts (TRs), are stripped U.S. Treasury securities that are
separated into their component parts through trusts created by their broker
sponsors. Bonds issued by the Financing Corporation (FICO) can also be
stripped in this fashion.
Because of the SEC's views on privately stripped government securities, the
Portfolio must evaluate them as it would non-government securities
pursuant to regulatory guidelines applicable to all money market funds.
Accordingly, the Portfolio intends to purchase only those privately
stripped government securities that have either received the highest rating
from two nationally recognized rating services (or one, if only one has
rated the security), or, if unrated, been judged to be of equivalent
quality by FMR pursuant to procedures adopted by the Board of Trustees.
PUT FEATURES entitle the holder to resell a security to the
issuer or a third party at any time or at specified intervals. They are
subject to the risk that the put provider is unable to honor the put
feature (purchase the security). Put providers often support their ability
to buy securities on demand by obtaining letters of credit or other
guarantees from domestic or foreign banks. FMR may rely on its evaluation
of a bank's credit in determining whether to purchase a security supported
by a letter of credit. In evaluating a foreign bank's credit, FMR will
consider whether adequate public information about the bank is available
and whether the bank may be subject to unfavorable political or economic
developments, currency controls, or other government restrictions that
might affect the bank's ability to honor its credit commitment. Demand
features, standby commitments, and tender options are types of put
features.
ILLIQUID INVESTMENTS are investments that cannot be sold or disposed of in
the ordinary course of business at approximately the prices at which they
are valued. Under the supervision of the Board of Trustees, FMR determines
the liquidity of the Portfolio's investments and, through reports from FMR,
the Board monitors investments in illiquid instruments. In determining the
liquidity of the Portfolio's investments, FMR may consider various factors
including (1) the frequency of trades and quotations, (2) the number of
dealers and prospective purchasers in the marketplace, (3) dealer
undertakings to make a market, (4) the nature of the security (including
any demand or tender features) and (5) the nature of the marketplace for
trades (including the ability to assign or offset the Portfolio's rights
and obligations relating to the investment). Investments currently
considered by the Portfolio to be illiquid include repurchase agreements
not entitling the holder to payment of principal and interest within seven
days. Also, FMR may determine some restricted securities and time deposits
to be illiquid. In the absence of market quotations, illiquid investments
are valued for purposes of monitoring amortized cost valuation at fair
value as determined in good faith by a committee appointed by the Board of
Trustees. If through a change in values, net assets or other circumstances,
the Portfolio were in a position where 10% or more of its net assets were
invested in illiquid securities, it would seek to take appropriate steps to
protect liquidity.
RESTRICTED SECURITIES generally can be sold in privately negotiated
transactions, pursuant to an exemption from registration under the
Securities Act of 1933, or in a registered public offering. Where
registration is required, the Portfolio may be obligated to pay all or part
of the registration expense and a considerable period may elapse between
the time it decides to seek registration and the time the Portfolio may be
permitted to sell a security under an effective registration statement. If,
during such a period, adverse market conditions were to develop, the
Portfolio might obtain a less favorable price than prevailed when it
decided to seek registration of the security. However, in general, the
Portfolio anticipates holding restricted securities to maturity or selling
them in an exempt transaction.
QUALITY AND MATURITY. Pursuant to procedures adopted by the Board of
Trustees, the Portfolio may purchase only high-quality securities that FMR
believes present minimal credit risks. To be considered high quality, a
security must be rated in accordance with applicable rules in one of
the two highest categories for short-term securities by at least two
nationally recognized rating services (or by one, if only one rating
service has rated the security); or, if unrated, judged to be of equivalent
quality by FMR.
High-quality securities are divided into "first tier" and "second tier"
securities. First tier securities are those deemed to be in the
highest rating category (e.g., Standard & Poor's A-1 ), and
s econd tier securities are those deemed to be in the
second highest rating category (e.g., Standard & Poor's A-2).
The Portfolio may not invest more than 5% of its total assets in second
tier securities. In addition, the Portfolio may not invest more than 1% of
its total assets or $1 million (whichever is greater) in the second tier
securities of a single issuer.
The Portfolio currently intends to limit its investments to securities with
remaining maturities of 397 days or less, and to maintain a dollar-weighted
average maturity of 90 days or less. When determining the maturity of a
security, the Portfolio may look to an interest rate reset or demand
feature.
SHORT SALES AGAINST THE BOX. The Portfolio may sell securities short when
it owns or has the right to obtain securities equivalent in kind or amount
to the securities sold short. Short sales could be used to protect the net
asset value per share (NAV) of the Portfolio in anticipation of increased
interest rates without sacrificing the current yield of the securities sold
short. If the Portfolio enters into a short sale against the box, it will
be required to set aside securities equivalent in kind and amount to the
securities sold short (or securities convertible or exchangeable into such
securities) and will be required to continue to hold such securities while
the short sale is outstanding. The Portfolio will incur transaction costs,
including interest expenses, in connection with opening, maintaining and
closing short sales against the box.
VARIABLE AND FLOATING RATE SECURITIES provide for periodic adjustments
of the interest rate paid. Variable rate securities provide for a specified
periodic adjustment in the interest rate, while floating rate securities
have interest rates that change whenever there is a change in a designated
benchmark rate. Some variable or floating rate securities have put
features.
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are placed on
behalf of the Portfolio by FMR pursuant to authority contained in the
management contract. If FMR grants investment management authority to the
sub-adviser (see the section entitled "Management and Service Contracts"),
the sub-adviser will be authorized to place orders for the purchase and
sale of portfolio securities, and will do so in accordance with the
policies described below. FMR is also responsible for the placement of
transaction orders for other investment companies and accounts for which it
or its affiliates act as investment adviser. Securities purchased and sold
by the Portfolio generally will be traded on a net basis (i.e., without
commission). In selecting broker-dealers, subject to applicable limitations
of the federal securities laws, FMR considers various relevant factors,
including, but not limited to, the size and type of the transaction; the
nature and character of the markets for the security to be purchased or
sold; the execution efficiency, settlement capability, and financial
condition of the broker-dealer firm; the broker-dealer's execution services
rendered on a continuing basis; and the reasonableness of any commissions.
The Portfolio may execute portfolio transactions with broker-dealers who
provide research and execution services to the Portfolio or other accounts
over which FMR or its affiliates exercise investment discretion. Such
services may include advice concerning the value of securities; the
advisability of investing in, purchasing, or selling securities; the
availability of securities or the purchasers or sellers of securities;
furnishing analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy and performance of
accounts; and effecting securities transactions and performing functions
incidental thereto (such as clearance and settlement). FMR maintains a
listing of broker-dealers who provide such services on a regular basis.
However, as many transactions on behalf of the Portfolio are placed with
broker-dealers (including broker-dealers on the list) without regard to the
furnishing of such services, it is not possible to estimate the proportion
of such transactions directed to such broker-dealers solely because such
services were provided. The selection of such broker-dealers generally is
made by FMR (to the extent possible consistent with execution
considerations) based upon the quality of research and execution services
provided.
The receipt of research from broker-dealers that execute transactions on
behalf of the Portfolio may be useful to FMR in rendering investment
management services to the Portfolio or its other clients, and conversely,
such research provided by broker-dealers who have executed transaction
orders on behalf of other FMR clients may be useful to FMR in carrying out
its obligations to the Portfolio. The receipt of such research has not
reduced FMR's normal independent research activities; however, it enables
FMR to avoid the additional expenses that could be incurred if FMR tried to
develop comparable information through its own efforts.
Subject to applicable limitations of the federal securities laws,
broker-dealers may receive commissions for agency transactions that are in
excess of the amount of commissions charged by other broker-dealers in
recognition of their research and execution services. In order to cause the
Portfolio to pay such higher commissions, FMR must determine in good faith
that such commissions are reasonable in relation to the value of the
brokerage and research services provided by such executing broker-dealers,
viewed in terms of a particular transaction or FMR's overall
responsibilities to the Portfolio and its other clients. In reaching this
determination, FMR will not attempt to place a specific dollar value on the
brokerage and research services provided, or to determine what portion of
the compensation should be related to those services.
FMR is authorized to use research services provided by and to place
portfolio transactions with brokerage firms that have provided assistance
in the distribution of shares of the Portfolio or shares of other Fidelity
funds to the extent permitted by law. FMR may use research services
provided by and place agency transactions with Fidelity Brokerage Services,
Inc. (FBSI) and Fidelity Brokerage Services, Ltd. (FBSL), subsidiaries of
FMR Corp., if the commissions are fair, reasonable, and comparable to
commissions charged by non-affiliated, qualified brokerage firms for
similar services.
Section 11(a) of the Securities Exchange Act of 1934 prohibits members of
national securities exchanges from executing exchange transactions for
accounts which they or their affiliates manage, unless certain requirements
are satisfied. Pursuant to such requirements, the Board of Trustees has
authorized FBSI to execute portfolio transactions on national securities
exchanges in accordance with approved procedures and applicable SEC rules.
The Trustees periodically review FMR's performance of its responsibilities
in connection with the placement of portfolio transactions on behalf of the
Portfolio and review the commissions paid by the Portfolio over
representative periods of time to determine if they are reasonable in
relation to the benefits to the Portfolio.
From time to time the Trustees will review whether the recapture for the
benefit of the Portfolio of some portion of the brokerage commissions or
similar fees paid by the Portfolio on portfolio transactions is legally
permissible and advisable. The Portfolio seeks to recapture soliciting
broker-dealer fees on the tender of portfolio securities, but at present no
other recapture arrangements are in effect. The Trustees intend to continue
to review whether recapture opportunities are available and are legally
permissible and, if so, to determine, in the exercise of their business
judgment whether it would be advisable for the Portfolio to seek such
recapture.
Although the Trustees and officers of the Trust are substantially the same
as those of other funds managed by FMR, investment decisions for the Trust
are made independently from those of other funds managed by FMR or accounts
managed by FMR affiliates. It sometimes happens that the same security is
held in the portfolio of more than one of these funds or accounts.
Simultaneous transactions are inevitable when several funds are managed by
the same investment adviser, particularly when the same security is
suitable for the investment objective of more than one fund or account.
When two or more funds are simultaneously engaged in the purchase or sale
of the same security, the prices and amounts are allocated in accordance
with procedures believed to be appropriate and equitable for the Portfolio.
In some cases this system could have a detrimental effect on the price or
value of the security as far as the Portfolio is concerned. In other cases,
however, the ability of the Portfolio to participate in volume transactions
will produce better executions and prices for the Portfolio. It is the
current opinion of the Trustees that the desirability of retaining FMR as
investment adviser to the Portfolio outweighs any disadvantages that may be
said to exist from exposure to simultaneous transactions.
VALUATION OF PORTFOLIO SECURITIES
The Portfolio values its investments on the basis of amortized cost. This
technique involves valuing an instrument at its cost as adjusted for
amortization of premium or accretion of discount rather than its value
based on current market quotations or appropriate substitutes which reflect
current market conditions. The amortized cost value of an instrument may be
higher or lower than the price the Portfolio would receive if it sold the
instrument.
Valuing the Portfolio's instruments on the basis of amortized cost and use
of the term "money market fund" are permitted by Rule 2a-7 under the 1940
Act. The Portfolio must adhere to certain conditions under Rule 2a-7; these
conditions are summarized in the Prospectus.
The Board of Trustees of the Trust oversees FMR's adherence to SEC rules
concerning money market funds, and has established procedures designed to
stabilize the Portfolio's NAV at $1.00. At such intervals as they deem
appropriate, the Trustees consider the extent to which NAV calculated by
using market valuations would deviate from $1.00 per share. If the Trustees
believe that a deviation from the Portfolio's amortized cost per share may
result in material dilution or other unfair results to shareholders, the
Trustees have agreed to take such corrective action, if any, as they deem
appropriate to eliminate or reduce, to the extent reasonably practicable,
the dilution or unfair results. Such corrective action could include
selling portfolio instruments prior to maturity to realize capital gains or
losses or to shorten average portfolio maturity; withholding dividends;
redeeming shares in kind; establishing NAV by using available market
quotations; and such other measures as the Trustees may deem appropriate.
During periods of declining interest rates, the Portfolio's yield based on
amortized cost may be higher than the yield based on market valuations.
Under these circumstances, a shareholder in the Portfolio would be able to
obtain a somewhat higher yield than would result if the Portfolio utilized
market valuations to determine its NAV. The converse would apply in a
period of rising interest rates.
PERFORMANCE
The Portfolio's performance may be compared to the performance of other
mutual funds in general, or to the performance of particular types of
mutual funds. These comparisons may be expressed as mutual fund rankings
prepared by Lipper Analytical Services, Inc. (Lipper), an independent
service located in Summit, New Jersey, which monitors the performance of
mutual funds. Lipper generally ranks funds on the basis of total return,
assuming reinvestment of distributions, but does not take sales charges or
redemption fees into consideration, and is prepared without regard to tax
consequences. Lipper may also rank the funds based on yield. In addition to
the mutual fund rankings, the Portfolio's performance may be compared to
mutual fund performance indices prepared by Lipper.
The Portfolio may also compare its performance or the performance of
securities in which it may invest to averages published by IBC/USA
(Publications), Inc. of Ashland, MA, 01721. These averages assume
reinvestment of distributions. The Money Fund Averages/All Taxable which is
reported in the Money Fund Report, covers over 607 taxable money market
funds. The Portfolio may reference the growth and variety of money market
mutual funds and FMR's innovation and participation in the industry.
The Portfolio also may compare its performance to the yields or averages of
other money market securities as reported by the Federal Reserve Bulletin,
by TeleRate, a financial information network, or by Salomon Brothers Inc.,
a broker-dealer firm, and to other fixed-income investments such as
Certificates of Deposit (CDs). The principal value and interest rate of CDs
and money market securities are fixed at the time of purchase, whereas the
Portfolio's yield will fluctuate. Unlike some CDs and certain other money
market securities, money market mutual funds are not insured by the FDIC.
Investors should give consideration to the quality and maturity of the
portfolio securities of the respective investment companies when comparing
investment alternatives.
YIELD CALCULATIONS. The Portfolio's yield refers to the income generated by
an investment in the Portfolio over a seven day period expressed as an
annual percentage rate. The effective yield, although calculated similarly,
will be slightly higher than the yield because it assumes that income
earned from the investment is reinvested (the compounding effect of
reinvestment). In addition to the current yield, the Portfolio may quote
yields in advertising based on any historical seven day period.
TOTAL RETURN CALCULATIONS. Total returns quoted in advertising reflect all
aspects of the Portfolio's return, including the effect of reinvesting
dividends and capital gain distributions (if any). Average annual returns
are calculated by determining the growth or decline in value of a
hypothetical historical investment in the Portfolio over a stated period,
and then calculating the annually compounded percentage rate that would
have produced the same result if the rate of growth or decline in the value
of the investment had been constant over the period. For example, a
cumulative return of 100% over ten years would produce an average annual
return of 7.18%, which is the steady annual rate that would equal 100%
growth on a compounded basis in ten years. While average annual returns are
a convenient means of comparing investment alternatives, investors should
realize that the Portfolio's performance is not constant over time, but
changes from year to year, and that average annual returns represent
averaged figures as opposed to the actual year-to-year performance of the
Portfolio.
In addition to average annual returns, the Portfolio may quote unaveraged
or cumulative total returns reflecting the simple change in the value of an
investment over a stated period. Average annual and cumulative total
returns may be quoted as percentages or as dollar amounts and may be
calculated for a single investment, a series of investments or a series of
redemptions over any time period. Total returns may be broken down into
their components of income and capital in order to illustrate the
relationship of these factors and their contributions to total return.
Total returns, yields, and other performance information may be quoted
numerically or in a table, graph, or similar illustration. The Portfolio's
cumulative total returns and average annual returns for the fiscal year
ended August 31, 1994 were as follows:
Historical Portfolio Results
<TABLE>
<CAPTION>
<S> <C> <C> <C>
One Year Five Year Life of Portfolio*
Average Annual Total Returns 3.41 % 5.24 % 5.71 %
Cumulative Total Returns 3.41 % 29.08 % 37.62 %
</TABLE>
* Life of Portfolio from December 2, 1988 to August 31, 1994.
The following chart shows the income and capital elements of the
Portfolio's year-by-year total returns for the period December 2, 1988
through August 31, 1994 as compared to the cost of living measured by the
Consumer Price Index over the same period.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Period Initial $10,000 Value of Value of Total Consumer
Investment Reinvestment Reinvestment Value Price
Dividends Capital Gains Index**
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
10/31/89* $ 10,000 $ 814 $ 0 $ 10,814 $ 10,441
10/31/90 10,000 1,709 0 11,709 11,097
10/31/91 10,000 2,472 0 12,472 11,421
08/31/92*** 10,000 2,909 0 12,909 11,712
08/31/93 10,000 3,309 0 13,309 12,037
08/31/94 10,000 3,762 0 13,762 12,386
</TABLE>
* December 2, 1988 through October 31, 1989.
** From month-end closest to the initial investment date.
*** This period reflects the Portfolio's change of fiscal year-end date
from October 31 to August 31.
Explanatory Notes: With an initial investment of $10,000 made on December
2, 1988, the net amount invested in shares of the Portfolio was $10,000.
The cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends for the period covered (that is, their cash
value at the time they were reinvested) amounted to $ 13,762 . If
distributions had not been reinvested, the amount of distributions earned
from the Portfolio over time would have been smaller and the cash payments
(dividends) for the period would have come to $3,202 . The Portfolio
did not distribute any capital gains during the period.
The Portfolio may reference and discuss its fund number, Quotron number,
CUSIP number, and current portfolio manager in advertising.
From time to time, in reports and promotional literature, the Portfolio's
performance also may be compared to other mutual funds tracked by financial
or business publications and periodicals. For example, the Portfolio may
quote Morningstar, Inc. in its advertising materials. Morningstar, Inc. is
a mutual fund rating service that rates mutual funds of the basis or
risk-adjusted performance. In addition, the Portfolio may quote financial
or business publications and periodicals as they relate to portfolio
management, investment philosophy, and investment techniques. Rankings that
compare the performance of Fidelity funds to one another in appropriate
categories over specific periods of time may also be quoted in advertising.
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION
If the Trustees determine that existing conditions make cash payment
undesirable, redemption payments may be made in whole or in part in
securities or other property, valued for this purpose as they are valued in
computing the Portfolio's NAV. Shareholders receiving securities or other
property on redemption may realize a gain or loss for tax purposes, and
will incur any costs of sale, as well as the associated inconveniences.
Pursuant to Rule 11a-3 under the 1940 Act, the Portfolio is required to
give shareholders at least 60 days' notice prior to terminating or
modifying its exchange privilege. Under the Rule, the 60-day notification
requirement may be waived if (i) the only effect of a modification would be
to reduce or eliminate an administrative fee, redemption fee or deferred
sales charge ordinarily payable at the time of an exchange, or (ii) the
Portfolio suspends the redemption of the shares to be exchanged as
permitted under the 1940 Act or the rules and regulations thereunder, or
the fund to be acquired suspends the sale of its shares because it is
unable to invest amounts effectively in accordance with its investment
objective and policies.
The Portfolio has notified shareholders that it reserves the right at any
time, without prior notice, to refuse exchange purchases by any person or
group if, in FMR's judgment, the Portfolio would be unable to invest
effectively in accordance with its investment objective and policies or
might otherwise be adversely affected.
DISTRIBUTION AND TAXES
DISTRIBUTIONS. If you request to have distributions mailed to you and the
U.S. Postal Service cannot deliver your checks, or if your checks remain
uncashed for six months, Fidelity may reinvest your distributions at the
then-current NAV. All subsequent distributions will then be reinvested
until you provide Fidelity with alternate instructions.
DIVIDENDS. Dividends from the Portfolio will not normally qualify for the
dividends-received deduction available to corporations, since the
Portfolio's income is primarily derived from interest income and short-term
capital gains. Depending upon state law, a portion of the Portfolio's
dividends attributable to interest income derived from U.S. government
securities may be exempt from state and local taxation. The Portfolio will
provide information on the portion of the Portfolio's dividends, if any,
that qualify for this exemption.
CAPITAL GAIN DISTRIBUTIONS. The Portfolio may distribute short-term capital
gains once a year or more often as necessary to maintain its NAV at $1.00
per share or to comply with distribution requirements under federal tax
law. The Portfolio does not anticipate earning long-term capital gains on
securities held by the Portfolio.
TAX STATUS OF THE PORTFOLIO. The Portfolio has qualified and intends to
qualify as a "regulated investment company" under the Internal Revenue Code
of 1986, as amended (the Code), so that the Portfolio will not be liable
for federal income or excise taxes on net investment income or capital
gains to the extent that these are distributed to shareholders in
accordance with applicable provisions of the Code.
FMR
All of the stock of FMR is owned by FMR Corp ., the parent company
organized in 1972. Through ownership of voting common stock and the
execution of a shareholders' voting agreement, Edward C. Johnson 3d,
Johnson family members, and various trusts for the benefit of the Johnson
family form a controlling group with respect to FMR Corp.
At present, the principal operating activities of FMR Corp. are those
conducted by three of its divisions as follows: Fidelity Service Company
( FSC ), which is the transfer and shareholder servicing agent for
certain funds advised by FMR; FIIOC, which performs shareholder servicing
functions for institutional customers and funds sold through
intermediaries ; and Fidelity Investments Retail Marketing Company,
which provides marketing services to various companies within the Fidelity
organization.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions. For example, all
personal trades in most securities require pre-clearance, and participation
in initial public offerings are prohibited. In addition, restrictions on
the timing of personal investing relative to trades by Fidelity funds and
on short-term trading have been adopted. Personal investing is monitored to
protect shareholders' interests.
TRUSTEES AND OFFICERS
The Board of Trustees and executive officers of the Trust are listed below.
Except as indicated, each individual has held the office shown or other
offices in the same company for the last five years. All persons named as
Trustees and officers also serve in similar capacities for other funds
advised by FMR. Unless otherwise noted, the business address of each
Trustee and officer is 82 Devonshire Street, Boston, MA 02109, which is
also the address of FMR. Those Trustees who are "interested persons" (as
defined in the 1940 Act) by virtue of their affiliation with either the
Trust or FMR, are indicated by an asterisk (*).
*EDWARD C. JOHNSON 3d, Trustee and President, is Chairman, Chief 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 FMR Texas
Inc. (1989), Fidelity Management & Research (U.K.) Inc., and Fidelity
Management & Research (Far East) Inc.
*J. GARY BURKHEAD, Trustee and Senior Vice President, is President of FMR;
and President and a Director of FMR Texas Inc. (1989), Fidelity Management
& Research (U.K.) Inc., and Fidelity Management & Research (Far East) Inc.
RALPH F. COX, 200 Rivercrest Drive, Fort Worth, TX, Trustee (1991), is a
consultant to Western Mining Corporation (1994). Prior to February 1994, he
was President of Greenhill Petroleum Corporation (petroleum exploration and
production, 1990). Until March 1990, Mr. Cox was President and Chief
Operating Officer of Union Pacific Resources Company (exploration and
production). He is a Director of Sanifill Corporation (non-hazardous waste,
1993) and CH2M Hill Companies (engineering). In addition, he served on the
Board of Directors of the Norton Company (manufacturer of industrial
devices, 1983-1990) and continues to serve on the Board of Directors of the
Texas State Chamber of Commerce, and is a member of advisory boards of
Texas A&M University and the University of Texas at Austin.
PHYLLIS BURKE DAVIS, P.O. Box 264, Bridgehampton, N.Y., Trustee (1992).
Prior to her retirement in September 1991, Mrs. Davis was the Senior Vice
President of Corporate Affairs of Avon Products, Inc. She is currently a
Director of BellSouth Corporation (telecommunications), Eaton Corporation
(manufacturing, 1991), and the TJX Companies, Inc. (retail stores, 1990),
and previously served as a Director of Hallmark Cards, Inc. (1985-1991) and
Nabisco Brands, Inc. In addition, she is a member of the President's
Advisory Council of The University School of Vermont School of Business
Administration.
RICHARD J. FLYNN, 77 Fiske Hill, Sturbridge, MA, Trustee, is a financial
consultant. Prior to September 1986, Mr. Flynn was Vice Chairman and a
Director of the Norton Company (manufacturer of industrial devices). He is
currently a Director of Mechanics Bank and a Trustee of College of the Holy
Cross and Old Sturbridge Village, Inc.
E. BRADLEY JONES, 3881-2 Lander Road, Chagrin Falls, OH, Trustee (1990).
Prior to his retirement in 1984, Mr. Jones was Chairman and Chief Executive
Officer of LTV Steel Company. Prior to May 1990, he was Director of
National City Corporation (a bank holding company) and National City Bank
of Cleveland. He is a Director of TRW Inc. (original equipment and
replacement products), Cleveland-Cliffs Inc. (mining), NACCO Industries,
Inc. (mining and marketing), Consolidated Rail Corporation, Birmingham
Steel Corporation, Hyster-Yale Materials Handling, Inc. (1989), and RPM,
Inc. (manufacturer of chemical products, 1990). In addition, he serves as a
Trustee of First Union Real Estate Investments, Chairman of the Board of
Trustees and a member of the Executive Committee of the Cleveland Clinic
Foundation, a Trustee and a member of the Executive Committee of University
School (Cleveland), and a Trustee of Cleveland Clinic Florida.
DONALD J. KIRK, 680 Steamboat Road, Apartment #1-North, Greenwich, CT,
Trustee, is a Professor at Columbia University Graduate School of Business
and a financial consultant. Prior to 1987, he was Chairman of the Financial
Accounting Standards Board. Mr. Kirk is a Director of General Re
Corporation (reinsurance) and Valuation Research Corp. (appraisals and
valuations, 1993). In addition, he serves as Vice Chairman of the Board of
Directors of the National Arts Stabilization Fund and the Vice Chairman of
the Board of Trustees of the Greenwich Hospital Association.
*PETER S. LYNCH, Trustee (1990) is Vice Chairman of FMR (1992). Prior to
his retirement on May 31, 1990, he was a Director of FMR (1989) 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, Inc. (1991-1992). He is a Director
of W.R. Grace & Co. (chemicals, 1989) and Morrison Knudsen Corporation
(engineering and construction). 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 (1990).
GERALD C. McDONOUGH, 135 Aspenwood Drive, Cleveland, OH, Trustee (1989), is
Chairman of G.M. Management Group (strategic advisory services). Prior to
his retirement in July 1988, he was Chairman and Chief Executive Officer of
Leaseway Transportation Corp. (physical distribution services). Mr.
McDonough is a Director of ACME-Cleveland Corp. (metal working,
telecommunications and electronic products), Brush-Wellman Inc. (metal
refining), York International Corp. (air-conditioning and refrigeration,
1989), Commercial Intertech Corp. (water treatment equipment, 1992), and
Associated Estates Realty Corporation (a real estate investment trust,
1993).
EDWARD H. MALONE, 5601 Turtle Bay Drive #2104, Naples, FL, Trustee. Prior
to his retirement in 1985, Mr. Malone was Chairman, General Electric
Investment Corporation and a Vice President of General Electric Company. He
is a Director of Allegheny Power Systems, Inc. (electric utility), General
Re Corporation (reinsurance) and Mattel Inc. (toy manufacturer). In
addition, he serves as a Trustee of Corporate Property Investors, the EPS
Foundation at Trinity College, the Naples Philharmonic Center for the Arts,
and Rensselaer Polytechnic Institute, and he is a member of the Advisory
Boards of Butler Capital Corporation Funds and Warburg, Pincus Partnership
Funds.
MARVIN L. MANN, 55 Railroad Avenue, Greenwich, CT, Trustee (1993) is
Chairman of the Board, President, and Chief Executive Officer of Lexmark
International, Inc. (office machines, 1991). 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) and Infomart (marketing services, 1991), a Trammell Crow Co. In
addition, he serves as a Campaign Vice Chairman of the Tri-State United Way
(1993) and is a member of the University of Alabama President's Cabinet
(1990).
THOMAS R. WILLIAMS, 21st Floor, 191 Peachtree Street, N.E., Atlanta, GA,
Trustee, is President of The Wales Group, 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 BellSouth Corporation (telecommunications),
ConAgra, Inc. (agricultural products), Fisher Business Systems, Inc.
(computer software), Georgia Power Company (electric utility), Gerber Alley
& Associates, Inc. (computer software), National Life Insurance Company of
Vermont, American Software, Inc. (1989), and AppleSouth, Inc. (restaurants,
1992).
GARY L. FRENCH, Treasurer (1991). Prior to becoming Treasurer of the
Fidelity funds, Mr. French was Senior Vice President, Fund Accounting -
Fidelity Accounting & Custody Services Co. (1991); Vice President, Fund
Accounting - Fidelity Accounting & Custody Services Co. (1990); and Senior
Vice President, Chief Financial and Operations Officer - Huntington
Advisers, Inc. (1985-1990).
JOHN H. COSTELLO, Assistant Treasurer, is an employee of FMR.
LEONARD M. RUSH, Assistant Treasurer (1994), is an employee of FMR
(1994). Prior to becoming Assistant Treasurer of the Fidelity funds, Mr.
Rush was Chief Compliance Officer of FMR Corp. (1993-1994); Chief Financial
Officer of Fidelity Brokerage Services, Inc. (1990-1993); and Vice
President, Assistant Controller, and Director of the Accounting Department
- - First Boston Corp. (1986-1990).
ARTHUR S. LORING, Secretary, is Senior Vice President (1993) and
General Counsel of FMR, Vice President-Legal of FMR Corp., and Vice
President and Clerk of FDC .
FRED L. HENNING JR., Vice President (1994), is Vice President of Fidelity's
money market funds and Senior Vice President of FMR Texas, Inc.
THOMAS D. MAHER, Assistant Vice President (1990), is Assistant Vice
President of Fidelity's money market funds and Vice President and Associate
General Counsel of FMR Texas (1990). Prior to 1990, Mr. Maher was an
employee of FMR and Assistant Secretary of all the Fidelity funds
(1985-1989).
ROBERT LITTERST, Vice President of the Portfolio and of other funds advised
by FMR, is an employee of FMR Texas.
Under a retirement program that became effective on November 1, 1989,
Trustees, upon reaching age 72, become eligible to participate in a defined
benefit retirement program under which they receive payments during their
lifetime from the Portfolio based on their basic trustee fees and length of
service. Currently, Messrs. William R. Spaulding, Bertram H. Witham,
and David L. Yunich participate in the program.
The Trustees and officers of the Trust as a group, own less than 1% of the
Portfolio's outstanding shares.
MANAGEMENT AND SERVICE CONTRACTS
The Portfolio employs FMR to furnish investment advisory and other
services. Under its management contract with the Portfolio, FMR acts as
investment adviser and, subject to the supervision of the Board of
Trustees, directs the investments of the Portfolio in accordance with its
investment objective, policies and limitations. FMR also provides the
Portfolio with all necessary office facilities, equipment and personnel for
servicing the Portfolio's investments and compensates all officers of the
Trust, all Trustees who are "interested persons" of the Trust or of FMR,
and all personnel of the Trust 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
the Portfolio. These services include providing facilities for maintaining
the Portfolio's organization, supervising relations with custodians,
transfer and pricing agents, accountants, underwriters and other persons
dealing with the Portfolio; preparing all general shareholder
communications and conducting shareholder relations; maintaining the
Trust's records and the registration of the Portfolio's shares under
federal and state law; developing management and shareholder services for
the Portfolio; and furnishing reports, evaluations and analyses on a
variety of subjects to the Trustees on behalf of the Portfolio.
FMR pays all of the expenses of the Portfolio, except as described below.
Specific expenses payable by FMR include, without limitation, the fees and
expenses of registering and qualifying the Portfolio and its shares for
distribution under federal and state securities laws; expenses of
typesetting for printing the Prospectus and SAI; custodian charges;
auditing and legal expenses; insurance expenses; association membership
dues; the expense of reports to shareholders; shareholders' meetings; and
proxy solicitations.
FIIOC is transfer, dividend disbursing, and shareholder servicing agent for
the Portfolio. The costs of these services are borne by FMR pursuant to its
management contract with Portfolio. FSC calculates the Portfolio's
NAV and dividends, and maintains the Portfolio's general accounting
records. The costs of these services are also borne by FMR pursuant to its
management contract with the Portfolio.
FMR pays all other expenses of the Portfolio with the following exceptions:
the payment of fees and expenses of all Trustees of the Trust who are not
"interested persons" of the Trust or FMR; interest on borrowings; taxes;
brokerage commissions (if any); and such nonrecurring expenses as may
arise, including costs of litigation to which the Portfolio may be a party,
and any obligation it may have to indemnify its officers and Trustees with
respect to litigation.
For these services and FMR's payment of the Portfolio's expenses, the
Portfolio pays a monthly management fee to FMR at the annual rate of .42%
of the average net assets of the Portfolio throughout the month pursuant to
a management contract approved by shareholders on December 8, 1994 .
The management fee paid to FMR is reduced by an amount equal to the fees
and expenses of those Trustees who are not "interested persons" of the
Trust or FMR. For the twelve month periods ended August 31, 1994 and August
31, 1993, and the ten month period ended August 31, 1992, the Portfolio
paid $9,381,317 , $6,976,761, and $5,039,309 in management fees,
respectively, before reduction for fees and expenses of the non-interested
Trustees.
SUB-ADVISER. On behalf of the Portfolio, FMR has entered into a
sub-advisory agreement with FMR Texas pursuant to which FMR Texas has
primary responsibility for providing portfolio investment management
services to the Portfolio. Under the sub-advisory agreement, FMR pays FMR
Texas fees equal to 50% of the management fee payable to FMR under its
current management contract with the Portfolio. The fees paid to FMR Texas
are not reduced by any voluntary or mandatory expense reimbursements that
may be in effect from time to time. For the twelve month periods ended
August 31, 1994 and August 31, 1993, and the ten month period ended August
31, 1992, FMR paid FMR Texas fees that amounted to $4,690,659 ,
$3,482,286, and $2,515,800, respectively.
The Portfolio 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. The Distribution Agreement
calls for FDC to use all reasonable efforts, consistent with its
other business, to secure purchasers for shares of the Portfolios, which
are continuously offered. Promotional and administrative expenses in
connection with the offer and sale of shares are paid by FMR.
DISTRIBUTION AND SERVICE PLAN
The Board of Trustees, on behalf of the Portfolio, has adopted a
Distribution and Service Plan (the Plan) pursuant to Rule 12b-1 under the
1940 Act (the Rule). The Rule provides in substance that a mutual fund may
not engage directly or indirectly in financing any activity that is
primarily intended to result in the sale of shares of the fund except
pursuant to a plan adopted by the fund under the Rule. The Trust's Board of
Trustees has adopted the Plan to allow the Portfolio and FMR to incur
certain expenses that might be considered to constitute indirect payment by
the Portfolio of distribution expenses. Under the Plan, if the payment of
management fees by the Portfolio to FMR is deemed indirect financing by the
Portfolio of the distribution of its shares, such payment is authorized by
the Plan.
The Plan specifically recognizes that FMR, either directly or through
FDC , may use its management fee revenue, past profits or other
resources, without limitation, to pay promotional and administrative
expenses in connection with the offer and sale of shares of the Portfolio.
In addition, the Plan provides that FMR may use its resources, including
its management fee revenues, to make payments to third parties that provide
assistance in selling shares of the Portfolio or to third parties,
including banks, that render shareholder support services. The Trustees
have not yet authorized such payments to date.
As required by the Rule, the Trustees carefully considered all pertinent
factors relating to the implementation of the Plan prior to its approval,
and have determined that there is a reasonable likelihood that the Plan
will benefit the Portfolio and its shareholders. In particular, the
Trustees noted that the Plan does not authorize payments by the Portfolio
other than those made to FMR under its management contract with the
Portfolio. To the extent that the Plan gives FMR and FDC greater
flexibility in connection with the distribution of shares of the Portfolio,
additional sales of the Portfolio's shares may result. Additionally,
certain shareholder support services may be provided more effectively under
the Plan by local entities with whom shareholders have other relationships.
The Plan was approved by Fidelity Money Market Trust on December 8,
1994 by the shareholder s of the Portfolio, pursuant to an
Agreement and Plan of Conversion also approved by the
shareholders of the Portfolio on D ecember 8 , 1994.
The Glass-Steagall Act generally prohibits federally and state chartered or
supervised banks from engaging in the business of underwriting, selling or
distributing securities. Although the scope of this prohibition under the
Glass-Steagall Act has not been clearly defined by the courts or
appropriate regulatory agencies, FDC believes that the Glass
Steagall Act should not preclude a bank from performing shareholder support
services, or servicing and recordkeeping functions. FDC intends to
engage banks only to perform such functions. However, changes in federal or
state statutes and regulations pertaining to the permissible activities of
banks and their affiliates or subsidiaries, as well as further judicial or
administrative decisions or interpretations, could prevent a bank from
continuing to perform all or a part of the contemplated services. If a bank
were prohibited from so acting, the Trustees would consider what actions,
if any, would be necessary to continue to provide efficient and effective
shareholder services. In such event, changes in the operation of the
Portfolio might occur, including possible termination of any automatic
investment or redemption or other services then provided by the bank. It is
not expected that shareholders would suffer any adverse financial
consequences as a result of any of these occurrences. In addition, state
securities laws on this issue may differ from the interpretations of
federal law expressed herein, and banks and financial institutions may be
required to register as dealers pursuant to state law.
The Portfolio 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.
DESCRIPTION OF THE TRUST
TRUST ORGANIZATION. Retirement Money Market Portfolio is a portfolio of
Fidelity Money Market Trust, an open-end management investment company
originally organized as a Massachusetts business trust on August 21, 1978
and amended and restated November 1, 1989. On December 29, 1994, the
Trust was converted to a Delaware business trust pursuant to an agreement
approved by shareholders on December 8 , 1994. The Delaware trust,
which was organized on June 20, 1991 under the name of Fidelity Money
Market Trust I I , succeeded to the name Fidelity Money Market Trust
on December 29 , 1994. Currently there are five portfolios of the
Trust: U.S. Treasury Portfolio; U.S. Government Portfolio; Domestic Money
Market Portfolio; Retirement Money Market Portfolio; and Retirement
Government Money Market Portfolio. The Trust Instrument permits the
Trustees to create additional series.
In the event that FMR ceases to be the investment adviser to the
Portfolio , the right of the Trust or P ortfolio to use the
identifying name "Fidelity" may be withdrawn.
The assets of the Trust, received for the issue or sale of shares of each
portfolio and all income, earnings, profits, and proceeds thereof, subject
only to the rights of creditors, are especially allocated to such
portfolio, and constitute the underlying assets of such portfolio. The
underlying assets of each portfolio are segregated on the books of account,
and are to be charged with the liabilities with respect to such portfolio
and with a share of the general expenses of the Trust. Expenses with
respect to the Trust are to be allocated in proportion to the asset value
of the respective portfolios, except where allocations of direct expense
can otherwise be fairly made. The officers of the Trust, subject to the
general supervision of the Board of Trustees, have the power to determine
which expenses are allocable to a given portfolio, or which are general or
allocable to all of the portfolios. In the event of the dissolution or
liquidation of the Trust, shareholders of each portfolio are entitled to
receive as a class the underlying assets of such portfolio available for
distribution.
SHAREHOLDER AND TRUSTEE LIABILITY. The Trust is a business trust organized
under Delaware law. Delaware law provides that shareholders shall be
entitled to the same limitations of personal liability extended to
stockholders of private corporations for profit. The courts of some states,
however, may decline to apply Delaware law on this point. The Trust
Instrument contains an express disclaimer of shareholder liability for the
debts, liabilities, obligations, and expenses of the Trust and requires
that a disclaimer be given in each contract entered into or executed by the
Trust or the Trustees. The Trust Instrument provides for indemnification
out of each portfolio's property of any shareholder or former shareholder
held personally liable for the obligations of the portfolio. The Trust
Instrument also provides that each portfolio shall, upon request, assume
the defense of any claim made against any shareholder for any act or
obligation of the portfolio and satisfy any judgment thereon. Thus, the
risk of a shareholder incurring financial loss on account of shareholder
liability is limited to circumstances in which Delaware law does not apply,
no contractual limitation of liability was in effect, and a portfolio is
unable to meet its obligations. FMR believes that, in view of the above,
the risk of personal liability to shareholders is remote.
The Trust Instrument further provides that the Trustees, if they have
exercised reasonable care, will not be liable to any person other than the
Trust or its shareholders; moreover, the Trustees shall not be liable for
any conduct whatsoever provided that the Trustees are not protected against
any liability to which they would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence, or reckless disregard of the
duties involved in the conduct of their office.
VOTING RIGHTS. The Portfolio's capital consists of shares of
beneficial interest. As a shareholder, you receive one vote for each dollar
of net asset value you own. The shares have no preemptive or conversion
rights; the voting and dividend rights, the right of redemption, and the
privilege of exchange are described in the Prospectus. Shares are fully
paid and nonassessable, except as set forth under the heading "Shareholder
and Trustee Liability" above. Shareholders representing 10% or more of the
Trust or a portfolio may, as set forth in the Trust Instrument, call
meetings of the Trust or a portfolio for any purpose related to the Trust
or portfolio, as the case may be, including, in the case of a meeting of
the entire Trust, the purpose of voting on removal of one or more Trustees.
The Trust or any portfolio may be terminated upon the sale of its assets
to, or merger with, another open-end management investment company, or upon
liquidation and distribution of its assets. Generally such terminations
must be approved by vote of the holders of a majority of the Trust or the
portfolio, as determined by the current value of each shareholder's
investment in the portfolio or Trust; however, the Trustees may, without
prior shareholder approval, change the form of organization of the Trust by
merger, consolidation, or incorporation. If not so terminated or
reorganized, the Trust and each portfolio will continue indefinitely.
Under the Trust Instrument, the Trustees may, without shareholder vote,
cause the Trust to merge or consolidate into one or more Trusts,
partnerships, or corporations, or cause the Trust to be incorporated under
Delaware law, so long as the surviving entity is an open-end management
investment company that will succeed to or assume the Trust's registration
statement. Each portfolio may invest all of its assets in another
investment company.
As of October 31 , 1994 the following owned of record or beneficially
5% or more of outstanding shares: Hewlett Packard Company, Palo Alto,
CA: 5.62%.
CUSTODIAN. Morgan Guaranty Trust Company of New York, 60 Wall Street, New
York, NY, is custodian of the assets of the Portfolio. The custodian is
responsible for the safekeeping of the Trust's assets and the appointment
of subcustodian banks and clearing agencies. The custodian takes no part in
determining the investment policies of the Portfolio or in deciding which
securities are purchased or sold by the Portfolio. The Portfolio, however,
may invest in obligations of the custodian and may purchase securities from
or sell securities to the custodian.
FMR, its officers and directors and its affiliated companies and the
Trust's Trustees may from time to time have transactions with various
banks, including banks serving as custodians for certain of the portfolios
advised by FMR. 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 these transactions were not influenced by
existing or potential custodial or other Portfolio relationships.
AUDITOR. Coopers & Lybrand L.L.P., serves as the Trust's independent
accountant. The auditor examines financial statements for the Portfolio and
provides other audit, tax, and related services.
FINANCIAL STATEMENTS
The Portfolio's financial statements and financial highlights for the
fiscal year ended August 31, 1994, are included in the Portfolio's Annual
Report, which is a separate report supplied with this SAI . The
Portfolio's financial statements and financial highlights are incorporated
herein by reference.
APPENDIX
The descriptions that follow are examples of eligible ratings for the
Portfolio. The Portfolio, may, however, consider the ratings for other
types of investments and the ratings assigned by other rating organizations
when determining the eligibility of a particular investment.
DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC.'S COMMERCIAL PAPER RATINGS:
Issuers rated PRIME-1 (or related supporting institutions) have a superior
capacity for repayment of short-term promissory obligations. Prime-1
repayment capacity will normally be evidenced by the following
characteristics:
(small solid bullet) Leading market positions in well established
industries.
(small solid bullet) High rates of return on funds employed.
(small solid bullet) Conservative capitalization structures with moderate
reliance on debt and ample asset protection.
(small solid bullet) Broad margins in earnings coverage of fixed financial
charges and high internal cash generation.
(small solid bullet) Well established access to a range of financial
markets and assured sources of alternate liquidity.
Issuers rated PRIME-2 (or related supporting institutions) have a strong
capacity for repayment of short-term promissory obligations. This will
normally be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be
more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
DESCRIPTION OF STANDARD & POOR'S CORPORATION'S COMMERCIAL PAPER RATINGS:
A- Issuers assigned this highest rating are regarded as having the greatest
capacity for timely payment. Issues in this category are delineated with
the numbers 1, 2, and 3 to indicate the relative degree of safety.
A-1 - This designation indicates that the degree of safety regarding timely
payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics will be denoted with a plus (+)
sign designation.
A-2 - Capacity for timely payment on issues with this designation is
strong. However, the relative degree of safety is not as high as for issues
designated A-1.
FIDELITY MONEY MARKET TRUST
RETIREMENT MONEY MARKET PORTFOLIO
ANNUAL REPORT
AUGUST 31, 1994
FIDELITY MONEY MARKET TRUST: RETIREMENT MONEY MARKET PORTFOLIO
INVESTMENTS/AUGUST 31, 1994
(Showing Percentage of Total Value of Investments)
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Bankers' Acceptances - 0.5%
DOMESTIC BANKERS ACCEPTANCE - 0.2%
Chase Manhattan Bank
9/6/94 4.52% $ 5,986,761 $ 5,983,019 161999KY
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 0.3%
Fuji Bank, Ltd.
9/8/94 4.76 1,000,000 999,076 35999CHE
Sanwa Bank, Ltd.
11/28/94 5.03 6,800,000 6,718,052 804999NW
7,717,128
TOTAL BANKERS' ACCEPTANCES 13,700,147
Certificates of Deposit - 22.0%
DOMESTIC CERTIFICATES OF DEPOSIT - 1.9%
Household Bank, N.A.
9/1/94 4.70 5,000,000 5,000,000 4418009H
NBD Bank, N.A.
9/16/94 4.75 13,000,000 12,999,286 634990AM
Old Kent Bank & Trust Co.
2/27/95 5.25 10,000,000 10,000,000 679999DN
Trust Company Bank
1/31/95 3.76 30,000,000 29,959,795 8982769H
57,959,081
NEW YORK BRANCH, YANKEE DOLLAR, FOREIGN BANKS - 18.3%
Bank of Nova Scotia
9/1/94 4.64 15,000,000 15,000,000 669991DG
Bank of Tokyo
12/19/94 4.96 20,000,000 20,000,595 0659934J
Banque Nationale de Paris
9/13/94 4.71 10,000,000 10,000,066 055992NH
Caisse Nationale de Credit Agricole
9/8/94 4.84 (a) 20,000,000 20,001,264 1280059P
Dai-Ichi Kangyo Bank, Ltd.
9/21/94 4.59 10,000,000 10,000,276 2379988K
Fuji Bank, Ltd.
9/1/94 4.50 20,000,000 20,000,000 35999CGY
10/3/94 4.81 25,000,000 25,000,000 35999CHF
Industrial Bank of Japan, Ltd.
9/1/94 4.41 50,000,000 50,000,000 4559907S
Mitsubishi Bank, Ltd.
9/30/94 4.85 20,000,000 19,993,851 610998XL
12/28/94 5.00 50,000,000 50,000,000 610998YD
Rabobank Nederland, N.V.
10/17/94 4.83 3,000,000 2,997,837 216992JS
Sakura Bank, Ltd.
9/7/94 4.46% $ 25,000,000 $ 25,000,000 793999NJ
Sanwa Bank, Ltd.
9/6/94 4.45 15,000,000 15,000,021 804999PC
10/3/94 4.83 50,000,000 50,000,000 804999PR
11/18/94 4.90 15,000,000 15,001,926 804999PK
Societe Generale
9/1/94 4.00 16,000,000 16,000,000 833991SW
11/15/94 4.86 45,000,000 45,000,000 833991UE
1/17/95 5.18 20,000,000 20,000,000 833991TY
1/18/95 5.18 10,000,000 10,000,000 833991UA
Sumitomo Bank, Ltd.
9/1/94 4.52 10,000,000 10,000,000 86699EFN
11/16/94 4.87 25,000,000 25,000,000 86699EFS
11/16/94 4.90 25,000,000 25,000,000 86699EFV
Swiss Bank Corp.
9/1/94 4.69 50,000,000 50,000,000 870990YE
548,995,836
LONDON BRANCH, EURODOLLAR, FOREIGN BANKS - 1.8%
Barclays Bank, PLC
11/30/94 5.00 18,000,000 17,992,131 06799MAE
Mitsubishi Bank, Ltd.
9/22/94 4.58 10,000,000 9,999,563 610998XP
11/16/94 5.25 15,000,000 15,000,308 610998WG
Sumitomo Bank, Ltd.
12/22/94 5.01 10,000,000 10,000,306 86699EGB
52,992,308
TOTAL CERTIFICATES 659,947,225
Commercial Paper - 32.9%
Associates Corp. of North America
9/9/94 4.71 40,000,000 39,958,222 045992XL
11/14/94 4.91 10,000,000 9,900,306 045992XF
BNP U.S. Finance Corp.
1/6/95 5.21 15,000,000 14,731,183 064999AJ
Bear Stearns Cos., Inc.
9/19/94 4.48 20,000,000 19,955,500 07399CDC
9/19/94 4.50 15,000,000 14,966,475 07399CCV
Beneficial Corp.
9/14/94 4.47 10,000,000 9,983,931 0819909J
9/29/94 4.77 25,000,000 24,907,639 0819909M
CIT Group Holdings, Inc.
9/6/94 3.53 5,000,000 4,997,604 172990QN
9/15/94 4.48 10,000,000 9,982,656 172990ST
Canadian Wheat Board
2/10/95 5.23 15,000,000 14,655,750 136995AK
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Commercial Paper - CONTINUED
Commercial Credit Co.
9/13/94 4.47% $ 25,000,000 $ 24,962,917 2019907G
10/28/94 4.83 20,000,000 19,848,317 2019907S
Concord Leasing, Inc. (LOC Hong Kong & Shanghai Banking Corp.)
9/6/94 4.46 10,000,000 9,993,833 206993AQ
Credit Lyonnais North America
11/7/94 5.00 5,000,000 4,954,217 225995UH
Dean Witter, Discover & Co.
11/15/94 4.91 30,000,000 29,696,875 24299ADS
Exxon Asset Management Co.
10/17/94 4.80 30,000,000 29,817,150 29899HAE
Ford Motor Credit, PLC
11/15/94 4.93 25,000,000 24,746,354 34599DAQ
Ford Motor Credit Corp.
9/14/94 4.64 10,000,000 9,983,389 34599BTY
9/26/94 4.75 25,000,000 24,918,924 34599BSS
10/12/94 4.80 20,000,000 19,891,350 34599BUP
11/17/94 4.91 50,000,000 49,481,319 34599BUK
362991FS1/17/95 5.13 10,000,000 9,808,333 34599BUB
GTE Corp.
9/9/94 4.81 23,500,000 23,474,933
9/19/94 4.85 7,000,000 6,983,060
General Electric Capital Corp.
9/6/94 4.45 (a) 15,000,000 15,000,000 369998LE
9/15/94 4.46 (a) 10,000,000 10,000,000 369998NE
10/5/94 3.43 10,000,000 9,968,361 369998LT
10/6/94 3.43 10,000,000 9,967,431 369998LU
12/12/94 5.02 5,000,000 4,930,300 369998PT
1/11/95 5.58 10,000,000 9,802,917 369998PC
1/26/95 5.27 5,000,000 4,895,467 369998PU
2/10/95 5.24 25,000,000 24,426,250 369998QD
General Electric Capital Services Inc.
12/12/94 5.06 15,000,000 14,789,625 36999BBX
General Motors Acceptance Corp.
9/6/94 4.58 5,000,000 4,996,854 638998TK
10/24/94 4.89 30,000,000 29,785,792 638998UN
10/27/94 4.81 20,000,000 19,852,222 638998UG
Goldman Sachs Group, L.P. (The)
9/6/94 4.71 30,000,000 29,980,542 696992LS
Household Finance Corp.
9/6/94 4.50 10,000,000 9,993,819 44199DKV
11/14/94 4.91 10,000,000 9,900,306 44199DLJ
IBM Corp.
9/12/94 4.53 1,000,000 998,625 45499ECC
10/25/94 4.88 10,000,000 9,927,400 45499ECD
ITT Corp.
9/16/94 4.58% $ 10,000,000 $ 9,981,042 450991GS
ITT Financial
10/24/94 4.89 5,000,000 4,964,299 450990LQ
Merrill Lynch & Co., Inc.
10/17/94 4.80 44,000,000 43,730,133 59099GDA
Morgan Stanley Group, Inc.
9/1/94 4.69 10,000,000 10,000,000 61799EKN
NationsBank Corp.
11/15/94 4.91 25,000,000 24,747,396 6385859D
New Center Asset Trust
10/24/94 4.86 25,000,000 24,822,597 643995CT
11/14/94 4.88 10,000,000 9,900,922 643995CR
11/21/94 4.94 20,000,000 19,780,400 643995CS
PNC Financial/PNC Funding
10/11/94 4.34 10,000,000 9,952,778 6934769J
Prudential Funding Corp.
12/2/94 5.00 10,000,000 9,874,778 743994KD
Prudential Home Mortgage Co.
9/19/94 4.48 20,000,000 19,955,500 74499FAM
11/14/94 4.93 10,000,000 9,899,894 74499FAP
Sears Roebuck Acceptance Corp.
10/20/94 4.92 8,300,000 8,244,870 81299EEJ
Smith Barney, Inc.
10/17/94 4.88 2,000,000 1,987,631 83199HAL
Student Loan Corporation
9/6/94 4.49 12,500,000 12,492,240 8639029N
9/6/94 4.50 25,000,000 24,984,462 8639029M
Textron, Inc.
9/1/94 4.59 5,000,000 5,000,000 88599CAX
9/1/94 4.60 5,515,000 5,515,000 88599CAW
Unocal Corp.
9/7/94 4.54 8,000,000 7,993,973 91499HAG
9/9/94 4.62 4,532,000 4,527,367 91499HAJ
Whirlpool Financial Corp.
9/1/94 4.95 16,500,000 16,500,000 963999CM
9/12/94 4.69 10,000,000 9,985,792 963999CH
Woolwich Equitable Building Society
10/19/94 4.71 20,000,000 19,876,000 980992FQ
TOTAL COMMERCIAL PAPER 986,533,222
Federal Agencies - 6.2%
FEDERAL HOME LOAN MORTGAGE CORP. - DISCOUNT NOTES - 0.8%
11/7/94 4.80 25,000,000 24,778,993 355993UY
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 4.4%
10/17/94 3.39 5,000 4,979 9931286L
10/27/94 4.69 10,000,000 9,927,822 9950096F
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Federal Agencies - CONTINUED
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - CONTINUED
2/3/95 5.08% $ 50,000,000 $ 48,930,069 9950098H
3/1/95 5.12 25,000,000 24,372,785 9950099M
3/2/95 4.84 30,000,000 29,244,700 9950099S
3/3/95 5.10 20,000,000 19,494,717 9950099V
131,975,072
INTERNATIONAL BANK OF RECONSTRUCTION AND DEVELOPMENT -
DISCOUNT NOTES - 1.0%
12/27/94 3.54 10,000,000 9,888,850 46399AAC
12/30/94 3.57 20,000,000 19,770,000 46399AAH
29,658,850
TOTAL FEDERAL AGENCIES 186,412,915
U.S. Treasury Obligations - 2.3%
U.S. Treasury Bills
1/12/95 3.52 20,000,000 19,748,408 993134FV
1/12/95 3.55 20,000,000 19,746,561 993134HV
1/12/95 3.59 10,000,000 9,871,803 993134PU
3/2/95 5.00 20,000,000 19,499,500 9931348B
TOTAL U.S. TREASURY OBLIGATIONS 68,866,272
Bank Notes - 8.1%
Bank of New York
9/1/94 5.46 (a) 10,000,000 9,996,989 06499AAW
Bank of New York (Delaware)
9/6/94 4.57 (a) 15,000,000 15,000,000 06499AAJ
Bank One - Dayton
9/1/94 5.46 (a) 15,000,000 15,000,000 059995BG
Bank One - Milwaukee
9/1/94 4.40 (a) 25,000,000 24,987,466 065996AN
Boatmen's National Bank, St. Louis
9/1/94 4.86 (a) 25,000,000 24,995,363 09699AAB
Comerica Bank - Detroit
9/1/94 5.46 (a) 10,000,000 10,000,000 226990AX
9/1/94 5.47 (a) 10,000,000 9,996,863 226990AT
First National Bank of Boston
9/30/94 4.65 12,000,000 12,000,000 3235859Y
Huntington Bank
9/1/94 4.85 (a) 10,000,000 9,991,534 4464389T
Key Bank of New York
9/1/94 4.86 (a) 20,000,000 19,981,340
49299JAAPNC Bank, N.A.
9/6/94 4.86 (a) 25,000,000 24,973,041 69399EAK
9/7/94 4.90 (a) 25,000,000 24,965,750 69399EAM
11/10/94 4.74 10,000,000 9,977,746 69399EAG
1/20/95 3.69 10,000,000 9,994,708 69399EAE
Society National Bank
9/1/94 5.47% (a) $ 20,000,000 $ 19,993,699 833995AL
TOTAL BANK NOTES 241,854,499
Master Notes (a) - 3.0%
J.P. Morgan Securities
9/1/94 5.11 33,000,000 33,000,000 6169988F
9/1/94 5.13 29,000,000 29,000,000 6169985D
Morgan Stanley Group Inc. (c)
9/1/94 5.08 15,000,000 15,000,000 61799EJQ
Norwest Corp.
9/1/94 4.82 14,000,000 14,000,000 66899CCD
TOTAL MASTER NOTES 91,000,000
Medium-Term Notes - 8.9%
Abbey National (UK), PLC (b)
9/1/94 5.48 (a) 10,000,000 9,998,707 007994GTAbbey National Treasury
Service (b)
9/30/94 4.77 (a) 74,000,000 74,000,000 010998AJ
Beneficial Corp.
9/15/94 4.82 (a) 15,000,000 14,996,388 0819909C
General Motors Acceptance Corp.
11/7/94 4.86 20,000,000 20,000,000 638998SX
Goldman Sachs Group, L.P. (The) (b)
9/1/94 4.48 (a) 17,000,000 17,000,000 696992KB
12/13/94 4.97 13,000,000 12,891,804 696992LL
12/16/94 4.91 (a) 15,000,000 15,000,000 696992LQ
Kingdom of Sweden - A (b)
9/23/94 4.81 (a) 12,500,000 12,500,000 998999BG
Kingdom of Sweden - B (b)
9/23/94 5.00 (a) 12,500,000 12,500,000 998999BH
Kingdom of Sweden - C (b)
9/23/94 4.63 (a) 12,500,000 12,500,000 998999BE
Merrill Lynch & Co., Inc.
9/1/94 4.83 (a) 10,000,000 10,000,000 59099GBR
Norwest Corp.
9/15/94 4.54 (a) 22,000,000 22,000,000 66899CBK
PHH Corp.
9/1/94 5.44 (a) 15,000,000 15,000,000 699990XT
Swedish National Housing Finance Corp. - A (b)
11/23/94 4.59 (a) 6,000,000 6,000,000 956995AP
Swedish National Housing Finance Corp. - B (b)
11/23/94 5.03 (a) 6,000,000 6,000,000 956995AR
Swedish National Housing Finance Corp. - C (b)
11/23/94 4.97 (a) 6,000,000 6,000,000 956995AQ
TOTAL MEDIUM NOTES 266,386,899
ANNUALIZED
YIELD AT
DUE TIME OF PRINCIPAL VALUE MATURITY VALUE
DATE PURCHASE AMOUNT (NOTE 1) AMOUNT (NOTE 1)
Short-Term Notes (a) (c) - 4.4%
CSA Funding - A
9/8/94 4.94% $ 6,000,000 $ 6,000,000 129993AC
CSA Funding - B
9/8/94 4.94 5,000,000 5,000,000 129993AC
SMM Trust Company (1994-A)
9/18/94 4.57 76,000,000 76,000,000 83199GAD
9/18/94 4.68 14,000,000 13,991,713 83199GAD
SMM Trust Company (1994-D)
10/28/94 4.84 15,000,000 15,000,000 83199GAJ
SMM Trust Company (1994-E)
10/13/94 4.64 4,000,000 4,000,000 83199GAF
10/13/94 4.73 7,000,000 6,996,462 83199GAF
SMM Trust Company (1994-F)
11/15/94 4.91 5,000,000 5,000,000 7845689T
TOTAL SHORT-TERM NOTES 131,988,175
Time Deposits - 5.2%
Bank of Tokyo
9/23/94 4.81 10,000,000 10,000,000 0659934Q
Dai-Ichi Kangyo Bank, Ltd.
9/6/94 4.50 25,000,000 25,000,000 2379988R
9/30/94 4.81 15,000,000 15,000,000 2379989C
Deutsche Bank, A.G.
9/6/94 4.75 25,000,000 25,000,000 251991MN
Mitsubishi Bank, Ltd.
10/3/94 4.30 30,000,000 30,000,000 610998YE
Society National Bank
9/1/94 4.94 50,000,000 50,000,000 833995BL
TOTAL TIME DEPOSITS 155,000,000
Municipal Bonds (a) - 1.9%
Harris County Texas Health Facilities Authority
9/2/94 4.50 25,000,000 25,000,000 41415P9Q
Illinois Student Assistance Commission
9/8/94 4.99 15,000,000 15,000,000 452281DD
Missouri Economic Development Export & Infrastructure
9/8/94 5.00 8,200,000 8,200,000 60635FAA
Texas General Obligation
9/8/94 4.82 9,000,000 9,000,000 8827162D
TOTAL MUNICIPAL BONDS 57,200,000
Repurchase Agreements - 4.6%
With First Boston Corporation:
At 4.80%, dated 8/23/94 due 10/4/94:
U.S. Government Obligations
(principal amount $51,638,537)
0% to 10%,
8/1/96 to 8/1/20 $ 50,280,000 $ 50,000,000
31699MBEWith Goldman, Sachs & Co.:
At 4.75%, dated 8/30/94 due 9/7/94:
U.S. Government Obligations
(principal amount $25,750,000)
3.832% to 6.50%,
12/1/23 to 4/1/34 25,026,389 25,000,000 38199MKX
At 4.75%, dated 8/30/94 due 9/20/94:
U.S. Government Obligations
(principal amount $21,630,000)
3.832% to 6.50%,
12/1/23 to 4/1/34 21,058,188 21,000,000 38199MKV
In a joint trading account
(U.S. Government Obligations)
dated 8/31/94, due 9/1/94
(Note 2)
At 4.89% 40,646,523 40,641,000 99799NWR
TOTAL REPURCHASE AGREEMENTS 136,641,000
TOTAL INVESTMENTS - 100% $ 2,995,530,354
Total Cost for Income Tax Purposes - $2,995,530,354
LEGEND:
(c) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due date on these types of
securities reflects the next interest rate reset date or when applicable,
the final maturity date.
(d) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $184,390,511 or 6.6% of net
assets.
(e) Restricted securities - Investment in securities not registered under
the Securities Act of 1933 (see Note 2 of Notes to Financial Statements).
Additional information on each holding is as follows:
ACQUISITION ACQUISITION
SECURITY DATE COST
CSA Funding - A 10/28/93 $ 6,000,000
CSA Funding - B 10/28/93 $ 5,000,000
Morgan Stanley Group, Inc 2/1/94 $ 15,000,000
SMM Trust Company:
(1994-A) 6/28/94 $ 90,000,000
(1994-E) 4/13/94 $ 4,000,000
(1994-E) 5/23/94 $ 6,994,869
(1994-D) 4/28/94 $ 15,000,000
(1994-F) 11/15/93 $ 5,000,000
INCOME TAX INFORMATION:
At August 31, 1994 the fund had a capital loss carryforward of
approximately $394,000 of which $23,000 and $371,000 will expire on August
31, 2001 and 2002, respectively.
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
August 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $136,641,000) - See accompanying $ 2,995,530,354
schedule
Receivable for investments sold 48,804,400
Interest receivable 8,531,768
TOTAL ASSETS 3,052,866,522
LIABILITIES
Payable for investments $ 239,420,400
purchased
Share transactions in process 12,365,712
Dividends payable 123,459
Accrued management fee 1,031,881
TOTAL LIABILITIES 252,941,452
NET ASSETS $ 2,799,925,070
Net Assets consist of:
Paid in capital $ 2,800,246,854
Accumulated net realized gain (loss) on investments (321,784)
NET ASSETS, for 2,800,246,854 shares outstanding $ 2,799,925,070
NET ASSET VALUE, offering price and redemption price per share ($2,799,925,070 (divided by) 2,800,246,854 $1.00
shares)
</TABLE>
Statement of Operations
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended August 31, 1994
INTEREST INCOME $ 86,309,591
EXPENSES
Management fee $ 9,368,441
Non-interested trustees' 12,876
compensation
TOTAL EXPENSES 9,381,317
NET INTEREST INCOME 76,928,274
NET REALIZED GAIN (LOSS) ON (371,025)
INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 76,557,249
</TABLE>
Statement of Changes in Net Assets
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED AUGUST 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 76,928,274 $ 50,729,790
Net interest income
Net realized gain (loss) (371,025) (22,769)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 76,557,249 50,707,021
Dividends to shareholders from net interest income (76,928,274) 50,729,790
Share transactions at net asset value of $1.00 per share 3,101,024,376 1,812,862,984
Proceeds from sales of shares
Reinvestment of dividends from net interest income 76,517,935 50,425,170
Cost of shares redeemed (2,083,212,672) (1,673,644,665)
Net increase (decrease) in net assets and shares resulting
from share transactions 1,094,329,639 189,643,489
TOTAL INCREASE (DECREASE) IN NET ASSETS 1,093,958,614 189,620,720
NET ASSETS
Beginning of period 1,705,966,456 1,516,345,736
End of period $ 2,799,925,070 $ 1,705,966,456
</TABLE>
FINANCIAL HIGHLIGHTS
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED AUGUST 31, TEN MONTHS YEARS ENDED OCTOBER 31,
ENDED
AUGUST 31,
1994 1993 1992 1991 1990
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations .034 .030 .035 .063 .080
Net interest income
Less Distributions (.034) (.030) (.035) (.063) (.080)
From net interest income
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 3.41% 3.09% 3.50% 6.52% 8.27%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 2,799,925 $ 1,705,966$ 1,516,346 $ 1,287,650 $ 622,774
Ratio of expenses to average net assets .42% .42% .42%A .42% .42%
Ratio of net interest income to average
net assets 3.44% 3.05% 4.12%A 6.19% 7.95%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 1994
1. SIGNIFICANT ACCOUNTING POLICIES.
Retirement Money Market Portfolio (the fund) is a fund of Fidelity Money
Market Trust (the trust) and is authorized to issue an unlimited number of
shares. The trust is registered under the Investment Company Act of 1940,
as amended (the 1940 Act), as an open-end management investment company
organized as a Massachusetts business trust. The following summarizes the
significant accounting policies of the fund:
SECURITY VALUATION. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost and
thereafter assume a constant amortization to maturity of any discount or
premium.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
REPURCHASE AGREEMENTS. The fund, through its custodian, receives delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. The fund's investment
adviser, Fidelity Management & Research Company (FMR), is responsible for
determining that the value of these underlying securities remains at least
equal to the resale price.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other affiliated
entities of FMR, may transfer uninvested cash balances into one or more
joint trading accounts. These balances are invested in one or more
repurchase agreements that mature in 60 days or less from the date of
purchase, and are collateralized by U.S. Treasury or Federal Agency
obligations.
RESTRICTED SECURITIES. The fund is permitted to invest in privately placed
restricted securities. These securities may be resold in transactions
exempt from registration or to the public if the securities are registered.
Disposal of these securities may involve time-consuming negotiations and
expense, and prompt sale at an acceptable price may be difficult. At the
end of the period, restricted securities (excluding 144A issues) amounted
to $146,988,175 or 5.2% of net assets for the fund.
INTERFUND LENDING PROGRAM. Pursuant to an Exemptive Order issued by the
SEC, the fund, along with other registered investment companies having
management contracts with FMR, may participate in an interfund lending
program. This program provides an alternative credit facility allowing the
fund to borrow from, or lend money to, other participating funds.
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR pays all expenses
except the compensation of the non-interested Trustees and certain
exceptions such as interest, taxes, brokerage commissions and extraordinary
expenses. FMR receives a fee that is computed daily at an annual rate of
.42% of the fund's average net assets.
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
SUB-ADVISER FEE. As the fund's investment sub-adviser, FMR Texas Inc., a
wholly owned subsidiary of FMR, receives a fee from FMR of 50% of the
management fee payable to FMR. The fee is paid prior to any voluntary
expense reimbursements which may be in effect, and after reducing the fee
for any payments by FMR pursuant to the fund's Distribution and Service
Plan.
4. INTERFUND LENDING PROGRAM.
The fund participated in the interfund lending program as a lender. The
maximum loan and the average daily loan balances during the periods for
which loans were outstanding amounted to $16,983,000 and $8,020,600,
respectively. The weighted average interest rate was 4.08%. Interest earned
from the interfund lending program amounted to $5,489 and is included in
interest income on the Statement of Operations.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Money Market Trust and the Shareholders of
Retirement Money Market Portfolio:
We have audited the accompanying statement of assets and liabilities of
Fidelity Money Market Trust: Retirement Money Market Portfolio, including
the schedule of portfolio investments, as of August 31, 1994, and the
related statement of operations for the year then ended, the statement of
changes in net assets for each of the two years in the period then ended,
and the financial highlights for each of the two years in the period then
ended, the ten month period ended August 31, 1992, and for each of the two
years in the period ended October 31, 1991.These financial statements and
financial highlights are the responsibility of the Trust's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of August 31, 1994 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of the Fidelity Money Market Trust: Retirement Money Market Portfolio as of
August 31, 1994, the results of its operations for the year then ended, the
changes in its net assets for each of the two years in the period then
ended, and the financial highlights for each of the two years in the period
then ended, the ten month period ended August 31, 1992, and for each of the
two years in the period ended October 31, 1991, in conformity with
generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Dallas, Texas
September 23, 1994
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL INFORMATION OF THE
SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUND UNLESS
PRECEDED OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS. MUTUAL FUND SHARES ARE
NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE
FDIC, THE FEDERAL RESERVE BOARD OR ANY
OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISK, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL. NEITHER THE FUND NOR
FIDELITY DISTRIBUTORS CORPORATION IS A BANK. FOR MORE INFORMATION ON ANY
FIDELITY FUND INCLUDING CHARGES AND
EXPENSES, CALL 1-800-544-0276 FOR A FREE PROSPECTUS. READ IT CAREFULLY
BEFORE YOU INVEST OR SEND MONEY.
Page 14 = BLANK
Do NOT Strip-In this type
REGIONAL OFFICES
NEW ENGLAND REGION
82 Devonshire Street
Boston, MA 02109
MIDWESTERN REGION
11 South LaSalle Street
Suite 810
Chicago, IL 60603
First Center Office Plaza
26955 Northwestern Highway
Suite 175
Southfield, MI 48037
MID-ATLANTIC REGION
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One Tower Bridge
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West Conshohocken, PA 19428
WESTERN REGION
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SOUTHEASTERN REGION
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SOUTHWESTERN REGION
1010 Lamar
Suite 975
Houston, TX 77002
400 East Las Colinas Boulevard
Canal Plaza
Irving, TX 75039
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
SUB-ADVISER
FMR Texas Inc.
Irving, TX
TRUSTEES
J. Gary Burkhead
Ralph F. Cox
Phyllis Burke Davis
Richard J. Flynn
Edward C. Johnson 3d
E. Bradley Jones
Donald J. Kirk
Peter S. Lynch
Edward H. Malone
Marvin L. Mann
Gerald C. McDonough
Thomas R. Williams
OFFICERS
Edward C. Johnson 3d, PRESIDENT
J. Gary Burkhead, SENIOR VICE PRESIDENT
Fred l. Henning Jr., VICE PRESIDENT
Thomas D. Maher, ASSISTANT VICE PRESIDENT
Gary L. French, TREASURER
John H. Costello, ASSISTANT TREASURER
Leonard M. Rush, ASSISTANT TREASURER
Arthur S. Loring, SECRETARY
CUSTODIAN
Morgan Guaranty Trust Company of New York
New York, NY
TRANSFER AND
SHAREHOLDER
SERVICING AGENT
Fidelity Investments Institutional
Operations Company
Boston, MA
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
RMM-10-94A
FIDELITY MONEY MARKET TRUST:
U.S. TREASURY PORTFOLIO, U.S. GOVERNMENT PORTFOLIO, AND
DOMESTIC MONEY MARKET PORTFOLIO
CROSS REFERENCE SHEET
Form N-1A Item Number
<TABLE>
<CAPTION>
<S> <C>
Part A Prospectus Caption
1 Cover Page
2 Summary of Portfolio Expenses
3 a, b Financial Highlights
c Performance
4 a(i) The Trust and the Fidelity Organization
a(ii), b, c Investment Objectives; Investment Policies, Risks and
Limitations;
Suitability
5 a The Trust and the Fidelity Organization
b, c, d, e The Trust and the Fidelity Organization;
Management Contracts, Distribution and Service Plans; How to
Invest, Exchange and Redeem
f Portfolio Transactions
5A a, b, c *
6 a(i) The Trust and the Fidelity Organization
a(ii) How to Invest, Exchange and Redeem
a(iii), b, c, d *SHOULD ITEM B BE ANSWERED BY THE TRUST AND THE
FIDELITY ORGANIZATION
e Cover Page; How to Invest, Exchange and Redeem
f, g How to Invest, Exchange and Redeem;
Distribution and Taxes
7 a Management Contracts, Distribution and
Service Plans
b(i, ii) How to Invest, Exchange and Redeem
b(iii, iv *
b(v) How to Invest, Exchange and Redeem
c *
d How to Invest, Exchange and Redeem
e, f (i, ii) Management Contracts, Distribution and
Service Plans
f (iii) *
8 a, b, c, d How to Invest, Exchange and Redeem
9 *
</TABLE>
* Not Applicable
Form N-1A Item Number
<TABLE>
<CAPTION>
<S> <C>
Part B Statement of Additional Information
10,11 Cover Page
12 Description of the Trust
13 a,b,c Investment Policies and Limitations
d *
14 a,b Trustees and Officers
c *
15 a, b Description of the Trust
c Trustees and Officers
16 a(i) FMR
a(ii) Trustees and Officers
a(iii), b Management Contracts; Distribution and Service Plans
c, d, e *
f Distribution and Service Plans
g *
h Description of the Trust
i Management Contracts; Distribution and Service Plans
17 a Portfolio Transactions
b *
c Portfolio Transactions
d, e *
18 a Description of the Trust
b *
19 a Additional Purchase and Redemption Information
b Valuation of Portfolio Securities
c *
20 Taxes
21 a(i,ii) Management Contracts; Distribution and Service Plans
a(iii),b,c *
22 Performance
23 Financial Statements for the Portfolios' fiscal year ended August
31, 1994 are incorporated by reference into the Statement of
Additional Information.
</TABLE>
* Not Applicable
FIDELITY MONEY MARKET TRUST:
U.S. Treasury Portfolio
U.S. Government Portfolio 82 DEVONSHIRE STREET
Domestic Money Market Portfolio BOSTON, MASSACHUSETTS 02109
PROSPECTUS
Fidelity Money Market Trust (the Trust) offers institutional, corporate and
individual investors a convenient and economical means of investing in
three professionally managed portfolios of money market instruments: U.S.
Treasury Portfolio, U.S. Government Portfolio and Domestic Money Market
Portfolio (the Portfolios). Each Portfolio is designed to meet investors'
distinctive requirements. Each Portfolio's investment objective is to
obtain as high a level of current income as is consistent with the
preservation of principal and liquidity within the standards prescribed for
each Portfolio.
AN INVESTMENT IN EACH PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT EACH PORTFOLIO WILL
MAINTAIN A STABLE $1.00 SHARE PRICE.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION. SHARES
ARE NOT INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY,
AND ARE SUBJECT TO INVESTMENT
RISK, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
To learn more about the Portfolios and their investments, you can obtain a
copy of the Portfolios' most recent financial report and portfolio listing,
or a copy of the Statement of Additional Information (SAI) dated December
29 , 1994. The SAI has been filed with the Securities and Exchange
Commission (SEC) and is incorporated herein by reference. For a free copy
of either document, call 1-800-843-3001.
If you are investing through a Financial Institution, contact that
Financial Institution directly.
TABLE OF CONTENTS
Summary of Portfolio Expenses
Financial Highlights
Investment Objectives
Investment Policies, Risks and Limitations
Portfolio Transactions
Performance
Distributions and Taxes
How to Invest, Exchange and Redeem
The Trust and the Fidelity Organization
Management Contracts, Distribution and Service Plan
Appendix
LIKE ALL MUTUAL FUNDS, THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
December 29 , 1994
5.SUMMARY OF PORTFOLIO EXPENSES
The purpose of the table below is to assist investors in understanding the
various costs and expenses that an investor in the Portfolios would bear
directly or indirectly. This standard format was developed for use by all
mutual funds to help investors make their investment decisions. This
expense information should be considered along with other important
information such as each Portfolio's investment objective and its past
performance. There are no transaction expenses associated with purchases or
sales of the Portfolios' shares.
A. ANNUAL OPERATING EXPENSES
(as a percentage of average net assets)
Domestic
U.S. U.S. Money
Treasury Government Market
Portfolio Portfolio Portfolio
Management Fee .42 % .42 % .42 %
Other Expenses .00% .00% .00%
TOTAL PORTFOLIO
OPERATING EXPENSES .42% .42% .42 %
B. EXAMPLE: You would pay the following expenses on a $1,000 investment,
assuming (1) 5% annual return and (2) redemption at the end of each time
period:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
$ 4 $ 13 $ 24 $ 53
6.EXPLANATION OF TABLE
A. ANNUAL PORTFOLIO OPERATING EXPENSES are based on the Portfolios'
historical expenses. Management fees are paid by each Portfolio to Fidelity
Management & Research Company (FMR) for managing its investments and
business affairs. FMR is responsible for all other expenses of the
Portfolios with certain exceptions. Management f ees and o ther
e xpenses are reflected in each Portfolio's share price or dividends
and are not charged directly to the individual shareholder accounts. Please
refer to the section entitled "Management Contracts, Distribution and
Service Plans" on page for further information.
B. EXAMPLE OF EXPENSES. The hypothetical example illustrates the
expenses associated with a $1,000 investment over periods of one, three,
five and ten years for each Portfolio, based on the expenses in the table
and an assumed annual rate of return of 5%. THE RETURN OF 5% AND
EXPENSES SHOULD NOT BE CONSIDERED INDICATIONS OF ACTUAL OR EXPECTED
PORTFOLIO PERFORMANCE OR EXPENSES, BOTH OF WHICH MAY VARY.
7.FINANCIAL HIGHLIGHTS
FINANCIAL HIGHLIGHTS. The tables that follow are included in the
Portfolios' Annual Report and has been audited by Coopers & Lybrand L.L.P.,
independent accountants. Their report on the financial statements and
financial highlights is included in the Annual Report. The financial
statements and financial highlights are incorporated into the Portfolios'
Statement of Additional Information.
U.S. TREASURY - FINANCIAL HIGHLIGHTS
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Year Ended August Ten Months Year s Ended October 31,
31, Ended
August 31,
SELECTED PER-SHARE DATA 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985
Net asset value, beginning $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of
period
Income from Investment .032 .029 .033 .061 .079 .088 .068 .060 .066 .078
Operations
Net interest income
Less Distributions (.032) (.029) (.033) (.061) (.079) (.088) (.068) (.060) (.066) (.078)
From net interest income
Net asset value, end of $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
TOTAL RETURN B 3.21 % 2.89% 3.37% 6.24% 8.19% 9.16% 6.98 %6.19% 6.85% 8.07%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period$ 178,596 $ 185,453 $ 191,984$ 215,610 $ 253,705 $ 347,662 $ 315,048 $ 307,971 $ 323,066 $ 247,233
(000 omitted)
Ratio of expenses to .42% .42% .42% A .42% .42% .42% .42% .42% .42% .37%
average net
assets
Ratio of expenses to .42% .42% .42% A .42% .42% .42% .42% .42% .42% .42%
average net
assets before expense
reductions
Ratio of net interest income3.15% 2.86% 4.00% A 6.12% 7.91% 8.80% 6.81% 6.03% 6.55% 7.81%
to
average net assets
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
U.S. GOVERNMENT - FINANCIAL HIGHLIGHTS
DRAFT
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Year Ended August Ten Months Year s Ended October 31,
31, Ended
August 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986 1985
SELECTED PER-SHARE DATA
Net asset value, beginning
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of
period
Income from Investment
.032 .029 .035 .062 .079 .088 .069 .063 .068 .080
Operations
Net interest income
Less Distributions
(.032) (.029) (.035) (.062) (.079) (.088) (.069) (.063) (.068) (.080)
From net interest income
Net asset value, end of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
TOTAL RETURN B
3.29 % 2.95% 3.53% 6.41% 8.20% 9.11% 7.14% 6.43% 7.04% 8.31%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period
$ 172,378 $ 206,538 $ 356,698 $ 400,699 $ 473,450 $ 536,219 $ 621,352 $ 880,490 $ 895,580 $ 922,104
(000 omitted)
Ratio of expenses to
.42% .42% .42% A .42% .42% .42% .42% .42% .42% .37%
average net assets
Ratio of expenses to
.42% .42% .42% A .42% .42% .42% .42% .42% .42% .42%
average net assets before
expense
reductions
Ratio of net interest income
3.23% 2.92% .18% A 6.27% 7.91% 8.72% 6.86% 6.26% 6.87% 8.01%
to average net assets
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
DOMESTIC MONEY MARKET -FINANCIAL HIGHLIGHTS
DRAFT
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Year Ended August Ten Months Year s Ended October 31,
31, Ended
August 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986 1985
SELECTED PER-SHARE DATA
Net asset value, beginning
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of
period
Income from Investment
.033 .029 .034 .063 .080 .089 .070 .062 .069 .081
Operations
Net interest income
Less Distributions
(.033) (.029) (.034) (.063) (.080) (.089) (.070) (.062) (.069) (.081)
From net interest income
Net asset value, end of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
TOTAL RETURN B
3.34 % 2.93% 3.44% 6.44% 8.27% 9.26% 7.27% 6.42% 7.07% 8.42%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period
$ 399,333 $ 611,410 $ 765,721 $ 851,872 $ 944,782 $ 1,273,74$ 1,035,75$ 1,231,76 $ 1,300,83 $ 1,482,71
(000 omitted) 5 6 8 2 9
Ratio of expenses to
.42% .42% .42% A .42% .42% .42% .42% .42% .42% .35%
average net assets
Ratio of expenses to
.42% .42% .42% A .42% .42% .42% .42% .42% .42% .42%
average net assets before
expense
reductions
Ratio of net interest income
3.24% 2.89% 4.04% A 6.38% 8.01% 8.91% 7.00% 6.22% 6.87% 8.13%
to average net assets
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
8.INVESTMENT OBJECTIVES
The investment objective of each Portfolio is to obtain as high a level of
current income as is consistent with the preservation of principal and
liquidity within the standards prescribed for each Portfolio. Each
Portfolio's investment objective is fundamental and may not be changed
without the affirmative vote of a majority of the outstanding shares of the
Portfolio. No assurance can be made that a Portfolio will achieve its
objective. Each Portfolio is different in terms of its permitted
investments and investment techniques. Each Portfolio seeks to maintain a
$1.00 share price at all times.
9.INVESTMENT POLICIES, RISKS AND LIMITATIONS
U.S. TREASURY PORTFOLIO invests in instruments which are issued or
guaranteed as to principal and interest by the U.S. government and thus
constitute direct obligations of the United States, and in repurchase
agreements backed by these instruments. These instruments include U.S.
Treasury bills, notes, and bonds, and instruments issued by the
Export-Import Bank of the United States, the General Services
Administration, the Government National Mortgage Association, the Small
Business Administration and the Washington Metropolitan Area Transit
Authority. As a non-fundamental operating policy, the Portfolio intends to
invest 100% of its assets in U.S. Treasury bills, notes and bonds
and other securities of the U.S. Treasury and in repurchase
agreements backed by these obligations. This policy may be changed only
upon 90 days' notice to shareholders.
U.S. GOVERNMENT PORTFOLIO invests in instruments issued or
guaranteed as to principal and interest by the U.S. government or by any of
its agencies or instrumentalities (U.S. government obligations) and
in repurchase agreements backed by such instruments. U.S. Government
Portfolio and U.S. Treasury Portfolio are distinguishable from one another
in that U.S. Government Portfolio may invest in instruments which
are backed only by the right of the issuer to borrow from the U.S. Treasury
or are backed only by the credit of the agency or instrumentality issuing
the obligations. Such instruments are not deemed direct obligations of the
United States and thus will not be purchased by U.S. Treasury Portfolio.
DOMESTIC MONEY MARKET PORTFOLIO invests in high quality U.S.
dollar-denominated money market instruments of domestic issuers such as (i)
bank obligations including certificates of deposit (CDs) and bankers'
acceptances of U.S. banks; (ii) commercial paper; (iii) U.S. government
obligations; and (iv) other debt obligations . Other debt
obligations include, but are not limited to, municipal obligations,
asset-backed securities, restricted securities, and securities issued by
special purpose entities.
Each Portfolio may engage in repurchase agreements and reverse repurchase
agreements with those parties whose creditworthiness has been reviewed and
found satisfactory by FMR; each Portfolio may invest in illiquid
securities.
The Trust has adopted a non-fundamental policy on behalf of each Portfolio
which requires each Portfolio to use its best efforts to maintain a
constant net asset value per share (NAV) of $1.00, and to value its
portfolio securities on the basis of the amortized cost valuation method,
pursuant to Rule 2a-7 under the Investment Company Act of 1940 (the 1940
Act). This method is based on acquisition cost and assumes a steady rate of
amortization of premium or discount from the date of purchase until
maturity instead of looking at actual changes in market values.
REGULATORY REQUIREMENTS. The following is a brief summary of
regulatory requirements applicable to all money market funds, which limit
certain of the Portfolios' investment policies, though U.S. Treasury
Portfolio and U.S. Government Portfolio follow more restrictive policies,
as described above.
(medium solid bullet) QUALITY. Pursuant to procedures adopted by the
Board of Trustees, each Portfolio may purchase only high quality securities
that FMR believes present minimal credit risks. To be considered high
quality, a security must be rated in accordance with applicable rules in
one of the two highest categories for short-term securities by at least two
nationally recognized rating services (or by one, if
only one rating service has rated the security); or, if unrated,
judged to be of equivalent quality by FMR.
High quality securities are divided into "first tier" and "second tier"
securities. FIRST TIER SECURITIES are those deemed to be in
the highest rating category (e.g., Standard & Poor's A-1).
SECOND TIER SECURITIES are those deemed to be in the second
highest rating category (e.g., Standard & Poor's A-2) .
(medium solid bullet) DIVERSIFICATION. Domestic Money Market
Portfolio may not invest more than 5% of its total assets in second tier
securities. In addition, Domestic Money Market Portfolio may not invest
more than 1% of its total assets or $1 million (whichever is greater) in
the second tier securities of a single issuer.
(medium solid bullet) MATURITY. Each Portfolio currently
intends to limit investments to securities with remaining maturities of
397 days or less , and to maintain a dollar-weighted average
maturity of 90 days or less. When determining the maturity of a
security, a Portfolio may look to an interest rate reset or demand
feature.
Each Portfolio's ability to achieve its investment objective depends on the
quality and maturity of its investments. Although the Portfolios' policies
are designed to help maintain a stable $1.00 share price, all money market
instruments can change in value when interest rates or issuers'
creditworthiness change, or if an issuer or guarantor of a security fails
to pay interest or principal when due. If these changes in value were large
enough, a Portfolio's share price could fall below $1.00. In general,
securities with longer maturities are more sensitive to interest rate
changes than are short-term securities, although those with longer
maturities may provide higher yields.
SUITABILITY. The Trust is designed as an economical and
convenient vehicle for those institutional, corporate and individual
investors seeking to obtain the yields available from money market
instruments while maintaining liquidity.
The Trust is designed particularly for banks seeking investment of
short-term monies held in accounts for which the bank acts in a fiduciary,
advisory, agency, custodial or similar capacity. The Trust may be equally
suitable for the investment of short-term funds held or managed by
corporations, employee benefit plans, insurance companies, unions,
hospitals, investment counselors, professional firms, educational,
religious and charitable organizations, investment bankers, brokers, and
others, if consistent with the objectives of the particular account and any
applicable state and federal laws and regulations.
The Trust offers the advantages of large purchasing power and
diversification, thereby avoiding the generally greater expense of
executing a large number of small transactions. The Trust also makes it
possible for individual investors to participate in a more diversified
portfolio of money market instruments than the size of their investments
might otherwise permit. Moreover, investment in the Trust relieves the
investor of many management and administrative burdens usually associated
with the direct purchase and sale of money market instruments. These
include selecting portfolio investments; surveying the market for the best
terms at which to buy and sell; scheduling and monitoring maturities and
reinvestments; receipt, delivery and safekeeping of securities; and
portfolio recordkeeping.
INVESTMENT LIMITATIONS. The following summarizes each Portfolio's
principal investment limitations. As a non-fundamental policy, the
Portfolios may invest up to 10% of their net assets in illiquid
investments. A complete listing is contained in the SAI.
(1) (a) With respect to 75% of its total assets, no Portfolio
may invest more than 5% in the securities of any
issuer (other than U.S. government securities) ; (b) Under
certain conditions, however, each Portfolio may invest up to 10% of its
total assets in the first tier securities of a single issuer for up to
three business days;
(2) Each Portfolio will not purchase a security (other than U.S.
government securities) if, as a result, more than 25% of its total assets
would be invested in the securities of issuers whose principal business
activities are in the same industry, except that Domestic Money
Market Portfolio will invest more than 25% of its total assets in the
financial services industry.
(3) (a) Each Portfolio may (i) borrow money for temporary or
emergency purposes and ( ii ) engage in reverse repurchase agreements
for any purpose; provided that ( i ) and ( ii ) in combination do
not exceed 33 1/3% of its total assets; (b) Each Portfolio may not
may not purchase any security while borrowings (other than reverse
repurchase agreements) representing more than 5% of its total assets are
outstanding; and
(4) Domestic Money Market Portfolio will limit loans to 33
1/3% of its total assets.
Limitations 1(a), 2, 3(a), and 4 are fundamental limitations. Each
Portfolio's investment policies and limitations, unless otherwise
indicated, are not fundamental, and may be changed without shareholder
approval. Except for the percentage limitation in 3 ( a ), these
limitations and policies are considered at the time of purchase; the sale
of securities is not required in the event of a subsequent change in
circumstances.
Because Domestic Money Market Portfolio concentrates more than 25% of its
total assets in the financial services industry, its performance may be
affected by conditions affecting banks and other financial services
companies. Companies in the financial services industry are subject to
various risks related to that industry, such as governmental regulation,
changes in interest rates, and exposure on loans, including loans to
foreign borrowers. Investments in the financial services industry may
include obligations of domestic banks, savings and loan associations,
consumer and industrial finance companies, securities brokerage companies,
leasing companies, and a variety of firms in the insurance field. These
obligations include time deposits, certificates of deposit, bankers'
acceptances, and commercial paper.
10.PORTFOLIO TRANSACTIONS
Money market obligations generally are traded in the over-the-counter
market through broker-dealers. A broker-dealer is a securities firm or bank
which makes a market for securities by offering to buy at one price and
sell at a slightly higher price. The difference between the prices is known
as a spread. Since FMR trades, directly or through affiliated sub-advisers,
a large number of securities, including those of Fidelity's other funds,
broker-dealers are willing to work with the funds on a more favorable
spread than would be possible for most individual investors.
Each Portfolio has authorized FMR to allocate transactions to some
broker-dealers who help distribute the Portfolio's shares or the shares of
Fidelity's other funds to the extent permitted by law, and on an agency
basis to an affiliate, Fidelity Brokerage Services, Inc. (FBSI). FMR will
allocate such transactions if commissions are comparable to those charged
by non-affiliated qualified broker-dealers for similar services. Higher
commissions may be paid to those firms that provide research services to
the extent permitted by law. FMR also is authorized to allocate brokerage
transactions to FBSI in order to secure from FBSI research services
produced by third party, independent entities. FMR may use this research
information in managing the Portfolios' assets, as well as assets of other
clients.
11.PERFORMANCE
From time to time each Portfolio advertises its YIELD and
EFFECTIVE YIELD in advertisements or in reports or other
communications with shareholders. Both yield figures are based on
historical earnings and are not intended to indicate future performance.
Each Portfolio's yield and effective yield figures are illustrated below
for the seven-day period ended August 31, 1994:
U.S. TREASURY PORTFOLIO
Effective
Yield Yield
4.23% 4.32%
U.S. GOVERNMENT PORTFOLIO
Effective
Yield Yield
4.22 % 4.31 %
DOMESTIC MONEY MARKET PORTFOLIO
Effective
Yield Yield
4.37 % 4.47 %
Each Portfolio's YIELD refers to the income generated by an
investment in the Portfolio over a seven-day period expressed as an annual
percentage rate. The EFFECTIVE YIELD is calculated similarly, but
assumes that the income earned from the investment is reinvested. The
effective yield will be slightly higher than the yield because of the
compounding effect on this assumed reinvestment.
Each Portfolio's TOTAL RETURN is based on the overall dollar or
percentage change in value of a hypothetical investment in a Portfolio,
assuming dividends are reinvested. A CUMULATIVE TOTAL RETURN
reflects a Portfolio's performance over a stated period of time. An
AVERAGE ANNUAL TOTAL RETURN reflects the hypothetical annually
compounded rate that would have produced the same cumulative total return
if performance had been constant over the entire period. Because average
annual returns tend to smooth out variations in a Portfolio's performance,
investors should recognize that they are not the same as actual
year-by-year results.
Each Portfolio may be rated to reflect investment quality by a
nationally recognized rating service . These quality ratings are
based on, but not limited to, an analysis of a Portfolio's operational
policies, investment strategies and management. These nationally
recognized rating service s also may undertake an ongoing analysis and
assessment of these criteria in order to continually update a Portfolio's
rating.
12.DISTRIBUTIONS AND TAXES
Each Portfolio ordinarily declares dividends from net investment income
daily and pays such dividends monthly. Each Portfolio intends to distribute
substantially all of its net investment income and capital gains, if any,
to shareholders within each calendar year as well as on a fiscal year
basis.
FEDERAL TAXES. Dividends derived from net investment income and
short-term capital gains are taxable as ordinary income. Each Portfolio's
distributions are taxable when they are paid, whether they are taken in
cash or reinvested in additional shares, except that distributions declared
in December and paid in January are taxable as if paid on December 31. The
Portfolios will send shareholders an Internal Revenue Service (IRS) Form
1099-DIV by January 31 showing taxable distributions for the past calendar
year.
OTHER TAX INFORMATION. The information above is only a summary of
some of the federal tax consequences generally affecting a Portfolio and
its shareholders, and no attempt has been made to discuss individual tax
consequences. In addition to federal tax, investors may be subject to state
or local taxes on their investment. Investors should consult their tax
advisors for details and up-to-date information on the tax laws in their
states.
When investors sign the account application, they will be asked to certify
that the social security or taxpayer identification number is correct and
that they are not subject to 31% backup withholding for failing to report
income to the IRS. If investors do not comply with IRS regulations, the IRS
can require each Portfolio to withhold 31% of taxable distributions and
redemptions.
STATE AND LOCAL TAXES. Mutual fund dividends from most U.S.
government securities generally are free from state and local income taxes.
However, particular states may limit this benefit, and some types of
securities, such as repurchase agreements and some agency-backed
securities, may not qualify for the benefit. Ginnie Mae securities and
other mortgage-backed securities are notable exceptions in most states.
Some states may impose intangible property taxes.
13.HOW TO INVEST, EXCHANGE AND REDEEM
Shares of each Portfolio are offered continuously and may be purchased at
the NAV next determined after an order is received and accepted. The
Portfolios do not impose any sales charges in connection with purchases of
their shares, although institutions may charge their clients fees in
connection with purchases and sales for the accounts of their clients. The
Trust may discontinue offering shares generally of any Portfolio or in any
particular state without notice to shareholders.
IF YOU ARE INVESTING THROUGH A SECURITIES DEALER OR BANK (FINANCIAL
INSTITUTION), CONTACT THAT FINANCIAL INSTITUTION DIRECTLY.
Investors purchasing shares of the Portfolios through a program of services
offered by a Financial Institution should read the program materials in
conjunction with this Prospectus. Certain features of the Portfolios may be
modified in these programs and administrative charges (in addition to
payments the Financial Institution may receive pursuant to the Distribution
and Service Plan) may be imposed for the services rendered. For further
information, including copies of the Prospectus, SAI and application,
investors should contact their Financial Institution or the Trust directly.
SHARE PRICE AND DIVIDENDS. Fidelity Service Co. (Service) calculates
each Portfolio's NAV at 3:00 p.m. and 4:00 p.m. Eastern time each day each
Portfolio is open for business (see "Holiday Schedule" on page ). The NAV
of each Portfolio is determined by adding the value of all securities and
other assets of the Portfolio, deducting the Portfolio's actual and accrued
liabilities, and dividing by the number of shares of the Portfolio
outstanding. Each Portfolio values its portfolio securities on the basis of
amortized cost.
Shares purchased at the 3:00 p.m. price earn the income dividend declared
that day. Shares purchased at the 4:00 p.m. price begin to earn income
dividends on the following business day. Purchases made by federal funds
wire will be processed at the 3:00 p.m. price if Client Services is
contacted before 3:00 p.m. Eastern time, and the Portfolio receives federal
funds that day. If investors do not call Client Services to give notice of
their wire investment before 3:00 p.m. Eastern time, their investment will
not begin to earn dividends until the first business day following receipt
of the wire. Investors may elect to receive monthly dividends in cash.
MINIMUM INVESTMENT AND ACCOUNT BALANCE. The minimum initial
investment to establish a new account in each Portfolio is $100,000.
Subsequent investments may be in any amount. To keep an account open, a
minimum balance of $100,000 must be maintained. If an account balance falls
below $100,000 due to redemption, the Portfolio may close the account and
wire the proceeds to the bank account of record. An investor will be given
30 days' notice that their account will be closed unless they make an
additional investment to increase their account balance to the $100,000
minimum.
14.HOW TO INVEST
Purchases may only be made by federal funds wire; checks will not be
accepted for purchases. There is no fee imposed by the Portfolios for wire
purchases. However, banks may impose such a fee.
An initial investment in a Portfolio must be preceded or accompanied by a
completed, signed application. Send the application to:
Fidelity Investments - Client Services
FIIOC, ZR7
P.O. Box 1182
Boston, MA 02103-1182
WIRING INSTRUCTIONS. For wiring information and instructions,
investors should call the Financial Institution through which they trade
or Client Services at 1-800-843-3001.
Each Portfolio requires notification of all wire purchases. To secure same
day acceptance of federal funds, investors must telephone Client Services
at 1-800-843-3001 between 8:30 a.m. and 3:00 p.m. Eastern time on the days
that the Portfolios are open for business to advise them of the wire and to
place the trade.
HOW TO EXCHANGE. An exchange is a convenient way to buy shares of
the Portfolios or other Fidelity funds. Each Portfolio's shares may be
exchanged (subject to minimum investment requirements and sales charges, if
any) for shares of Fidelity's other funds registered in the investor's
state. Investors must consult the prospectus of the fund to be acquired to
determine eligibility and suitability. The redemption will be made at the
next determined NAV of the shares to be redeemed after the exchange request
is received. The shares of the fund to be acquired will be purchased at the
next determined NAV after acceptance of the purchase order by the fund (in
accordance with the fund's customary policy for accepting investments).
Each Portfolio reserves the right at any time without prior notice to
refuse exchange purchases by any person or group if, in FMR's judgment, the
Portfolio would be unable to invest effectively in accordance with its
investment objective and policies or would otherwise potentially be
adversely affected. Each Portfolio may terminate or modify the exchange
privilege in the future.
Exchanges may only be made between accounts that are registered in the same
name, address, and taxpayer identification number. Exchanges will not be
permitted until a completed and signed mutual fund application is on file.
Exchanges may be requested by calling Client Services at the above
number.
HOW TO REDEEM. Investors may redeem all or a portion of their shares
on any business day. The shares will be redeemed at the next NAV calculated
after the Portfolio has received and accepted the redemption request. If an
account is closed, any accrued dividends will normally be paid at the
beginning of the following month. Redemptions may be made by calling Client
Services at 1-800-843-3001.
If telephone instructions are received between 8:30 a.m. and 3:00 p.m.
Eastern time, proceeds of the redemption will be wired in federal funds
that day to the shareholder's bank account designated on the application.
Otherwise, shares will be redeemed at the 4:00 p.m. price and proceeds will
be wired on the next business day. Shares redeemed at the 3:00 p.m. price
do not receive the dividend declared on the day of redemption. Shares
redeemed at the 4:00 p.m. price do receive the dividends declared on the
day of redemption.
Shareholders must designate on their application the U.S. commercial bank
account or accounts into which they wish the proceeds of redemptions from
their account in a Portfolio to be deposited. There is no charge imposed
for wiring of redemption proceeds. A shareholder may change the bank
account(s) designated to receive amounts redeemed at any time by sending a
letter of instruction with a signature guarantee to:
Fidelity Investments Institutional Operations Company
(FIIOC)
Mail Zone ZR5
P.O. Box 1182
Boston, MA 02103-1182
A signature guarantee is a widely accepted way to protect shareholders and
FIIOC by verifying the signature on their redemption request; it may not be
provided by a notary public. Signature guarantees will be accepted from:
banks, brokers, dealers, municipal securities dealers, municipal securities
brokers, government securities dealers, government securities brokers,
credit unions (if authorized under state law), national securities
exchanges, registered securities associations, clearing agencies and
savings associations.
Further documentation may be required when deemed appropriate by FIIOC.
When the New York Stock Exchange (NYSE) is closed (or when trading is
restricted) for any reason other than its customary weekend or holiday
closings, or under any emergency circumstances as determined by the SEC to
merit such action, the Portfolio may suspend redemption or postpone payment
dates. In addition, the Trust reserves the right to take up to seven days
to wire redemption proceeds if, in the judgment of FMR, the Trust could be
adversely affected by making immediate payment. Investors unable to execute
transactions by telephone (for example, during times of unusual market
activity) should consider placing their order by mail to FIIOC at the
address given above. In case of suspension of the right of redemption,
investors may either withdraw their request for redemption or receive
payment based on the NAV next determined after the termination of the
suspension.
INVESTOR ACCOUNTS. FIIOC is the transfer, dividend disbursing and
shareholder servicing agent for the Trust and maintains an account for each
investor expressed in terms of full and fractional shares of each Portfolio
rounded to the nearest 1/1000th of a share. Investments in the Portfolios
are credited to an investor's account in the form of shares immediately
upon acceptance as described above, and such shares become entitled to
dividends declared as of the day of acceptance. The Trust does not issue
share certificates, but FIIOC mails investors a confirmation of each
investment or redemption from their account.
SUBACCOUNTING AND SPECIAL SERVICES. Special processing has been
arranged with FIIOC for banks, corporations and other institutions that
wish to open multiple accounts (a master account and subaccounts). An
investor wishing to utilize FIIOC's subaccounting facilities or other
special services for individual or multiple accounts may be required to
enter into a separate agreement with FIIOC. Charges for these services, if
any, will be determined on the basis of the level of services to be
rendered. Subaccounts may be opened with the initial investment or at a
later date.
ADDITIONAL INFORMATION. All account transactions (including
purchases, redemptions and exchanges) by telephone through Client Services
will be recorded. The Transfer Agent may only be liable for losses
resulting from unauthorized transactions if it does not follow reasonable
procedures designed to verify the identity of the caller. Fidelity will
request personalized security codes or other information. Investors should
verify the accuracy of all transactions immediately upon receipt of their
confirmation statements. Investors who do not want the ability to redeem
and exchange by telephone should call Fidelity for instructions.
In order to allow FMR to manage the Portfolios most effectively, investors
are strongly urged to initiate all trades (investments, exchanges and
redemptions of shares) as early in the day as possible and to notify Client
Services at least one day in advance of trades in excess of $1 million. In
making these trade requests, the name(s) of the registered shareholder(s)
and the account number(s) must be supplied. To protect the Portfolios'
performance and shareholders, FMR discourages frequent trading in response
to short-term market fluctuations.
HOLIDAY SCHEDULE. Each Portfolio is open for business and its NAV is
calculated each day that both the Federal Reserve Bank of New York (New
York Fed) and the NYSE are open for trading. The following holiday closings
have been designated for 1995: New Year's Day (observed), Dr. Martin Luther
King, Jr. Day (observed), Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Columbus Day, Thanksgiving Day, and Christmas
Day. Although FMR expects the same holiday schedule to be observed in the
future, the New York Fed or NYSE may modify its holiday schedule at any
time. The right is reserved to advance the time by which purchase and
redemption orders must be received on any day (1) that the principal
government securities markets close early, such as on days in advance of
holidays generally observed by participants in such markets; (2) that the
New York Fed or the NYSE closes early; or (3) as permitted by the SEC.
Certain Fidelity funds may follow different holiday schedules.
STATEMENTS AND REPORTS. Shareholders will receive a monthly
statement which details every transaction that affects their share balance
or account registration. A statement with tax information will be mailed to
investors by January 31 of each tax year and also will be filed with the
IRS. At least twice a year investors will receive the Portfolios' financial
statements. To reduce expenses, only one copy of the Portfolios' reports
(such as the Annual Report) may be mailed to each shareholder's household.
Write to Client Services, at the address given on page , to have additional
reports sent each time.
15.THE TRUST AND THE FIDELITY ORGANIZATION
U.S. Treasury Portfolio, U.S. Government Portfolio, and Domestic Money
Market Portfolio are diversified portfolios of Fidelity Money Market Trust,
an open-end management investment company organized as a Delaware
business trust by a Trust Instrument dated December 29, 1994. The
Trust's Board of Trustees supervises Trust activities and reviews its
contractual arrangements with companies that provide it with services. The
Trust is not required to hold annual shareholder meetings, although special
meetings may be called for a specific Portfolio or the Trust as a whole for
purposes such as electing or removing Trustees, changing fundamental
policies or limitations or approving a management contract. As a
shareholder, the number of votes you are entitled to is based upon the
dollar value of your investment.
Fidelity Investments is one of the largest investment management
organizations in the United States and has its principal business address
at 82 Devonshire Street, Boston, MA. It includes a number of different
companies which provide a variety of financial services and products. The
Trust employs various Fidelity companies to perform certain activities
required for its operation.
FMR, the Portfolios' adviser, is the original Fidelity company, founded in
1946. FMR provides a number of mutual funds and other clients with
investment research and portfolio management services. FMR maintains a
large staff of experienced investment personnel and a full complement of
related support facilities. As of October 31 , 1994, FMR advised
funds having more than 21 million shareholder accounts with a total
value of more than $ 250 billion. FMR has been managing money market
funds since 1974. Fidelity Distributors Corporation (Distributors)
distributes shares for the Fidelity funds. FMR Corp. is the ultimate parent
company of FMR and FMR Texas Inc . (FMR Texas). Through
ownership of voting common stock, members of the Edward C. Johnson 3d
family form a controlling group with respect to FMR Corp. Changes may occur
in the Johnson family group, through death or disability, which would
result in changes in each individual family members' holding of stock. Such
changes could result in one or more family members becoming holders of over
25% of the stock. The Portfolios have received an opinion of counsel
that changes in the composition of the Johnson family group under these
circumstances would not result in the termination of the Portfolios'
management or distribution contracts and, accordingly, would not require a
shareholder vote to continue operation under those contracts.
16.MANAGEMENT CONTRACTS, DISTRIBUTION AND SERVICE PLANS
MANAGEMENT CONTRACTS. FMR manages each Portfolio's investments and
business affairs, and pays the Portfolios' expenses with the following
exceptions: the fees and expenses of those Trustees who are not "interested
persons" of the Trust or FMR; brokerage fees or commissions (if any);
interest on borrowings; taxes; and such extraordinary non-recurring
expenses as may arise, including litigation to which the Trust may be a
party. Transfer agent and dividend disbursing services are provided by
FIIOC, and portfolio and general accounting record maintenance are provided
by Service. The costs of these services are borne by FMR pursuant to its
Management Contract with each Portfolio. Both FIIOC and Service are
affiliates of FMR.
Each Portfolio pays FMR a monthly management fee at the annual rate of
0.42% of its average net assets throughout the month. For the fiscal year
ended August 31, 1994, management fees before reduction for compensation,
including reimbursement of expenses, to non-interested Trustees, for the
U.S. Treasury Portfolio, U.S. Government Portfolio, and Domestic Money
Market Portfolio amounted to $ 694,305 , $ 727,505 , and
$ 1,784,325 , respectively.
FMR has entered into a sub-advisory agreement with FMR Texas Inc. under
which FMR Texas has primary responsibility for providing portfolio
investment management services to each Portfolio while FMR retains
responsibility for providing other management services. Under each
sub-advisory agreement, FMR pays FMR Texas a fee equal to 50% of the
management fee payable to FMR under its current management contract with
the applicable Portfolio. The fees paid to FMR Texas are not reduced by any
voluntary or mandatory expense reimbursements that may be in effect from
time to time.
Total expenses for the fiscal year ended August 31, 1994 were .42 %
of average net assets for each Portfolio.
DISTRIBUTION AND SERVICE PLAN. The Board of Trustees, on behalf of
each Portfolio has adopted a Distribution and Service Plan (the Plans)
pursuant to Rule 12b-1 under the 1940 Act . Each Plan
specifically recognizes that FMR, either directly or through Distributors,
may use its management fee revenues, past profits or other resources,
without limitation, to pay promotional and administrative expenses in
connection with the offer and sale of shares of the Portfolios. In
addition, each Plan provides that FMR may use its resources, including its
management fee revenues, to make payments to third parties that provide
assistance in selling shares of the Portfolios or to third parties,
including banks, that render shareholder support services. The Board of
Trustees has authorized compensation to third parties under the Plans at an
annual rate of .08% annually of the average net assets of each Portfolio
with respect to which they provide or have provided shareholder support or
distribution services. No separate payments are authorized to be made by
the Portfolios under the Plans.
Each Portfolio also has a Distribution Agreement with Distributors, a
wholly-owned subsidiary of FMR Corp. Distributors, a Massachusetts
corporation organized July 18, 1960, is a broker-dealer registered under
the Securities Exchange Act of 1934 and a member of the National
Association of Securities Dealers, Inc. The Distribution Agreement calls
for Distributors to use all reasonable efforts, consistent with its other
business, to secure purchasers for shares of each Portfolio, which are
continuously offered. Promotional and administrative expenses in connection
with the offer and sale of shares are paid by FMR. Distributors also acts
as distributor for other Fidelity funds. The expenses of these operations
are borne by FMR or Distributors.
17.APPENDIX
The following paragraphs provide a brief description of the securities in
which the Portfolios may invest and the transactions they may make. The
Portfolios are not limited by this discussion, however, and they may
purchase other types of securities and enter into other types of
transactions if they are consistent with the Portfolios' investment
objectives and policies.
A complete listing of the Portfolios' policies and limitations and more
detailed information about the Portfolios' investments are contained in the
Portfolios' SAI. Current holdings and recent investment strategies are
described in the Portfolios' financial report, which is sent to
shareholders twice a year.
ASSET BACKED SECURITIES include interests in pools of mortgages,
loans, receivables or other assets. Payment of principal and interest may
be largely dependent upon the cash flows generated by the assets backing
the securities.
BANKERS' ACCEPTANCES are negotiable obligations of a bank to pay a
draft which has been drawn on it by a customer. These obligations are drawn
on large banks and usually backed by goods in international trade.
CERTIFICATES OF DEPOSIT are negotiable certificates representing a
commercial bank's obligations to repay funds deposited with it, earning
special rates of interest over a given period of time.
COMMERCIAL PAPER are short-term obligations issued by banks,
broker-dealers, corporations and other entities for purposes such as
financing their current operations.
DELAYED DELIVERY TRANSACTIONS. The Portfolios may buy and sell
securities on a when-issued or delayed delivery basis, with payment and
delivery taking place at a future date. The market value of securities
purchased in this way may change before the delivery date, which could
affect the market value of the Portfolios' assets. Ordinarily, the
Portfolios will not earn interest on securities until they are delivered.
ILLIQUID INVESTMENTS. Under the supervision of the Board of
Trustees, FMR determines the liquidity of each Portfolio's investments. The
absence of a trading market can make it difficult to ascertain a market
value for illiquid investments. Disposing of illiquid investments may
involve time-consuming negotiation and legal expenses, and it may be
difficult or impossible for the Portfolios to sell illiquid investments
promptly at an acceptable price.
INTERFUND BORROWING PROGRAM. The Portfolios have received permission
from the SEC to lend money to and borrow money from other funds advised by
FMR or its affiliates. Interfund loans and borrowings normally will extend
overnight, but can have a maximum duration of seven days. U.S. Treasury
Portfolio and U.S. Government Portfolio will participate in this program
only as borrowers , and each Portfolio will borrow through the
program only when the costs are equal to or lower than the cost of bank
loans. Domestic Money Market Portfolio will lend through the program only
when the returns are higher than those available at the same time from
other short-term instruments (such as repurchase agreements), and will not
lend more than 10% of its assets to other funds.
A Portfolio will not borrow through the program if, after doing so, total
outstanding borrowings immediately after such borrowings would exceed 15%
of its total assets. Loans may be called on one day's notice, and Domestic
Money Market Portfolio may have to borrow from a bank at a higher interest
rate if an interfund loan is called or not renewed. Any delay in repayment
to Domestic Money Market Portfolio could result in a lost investment
opportunity or additional borrowing costs.
MUNICIPAL OBLIGATIONS are issued to raise money for various public
purposes, including general purpose financing for state and local
governments as well as financing for specific projects or public
facilities. Municipal obligations may be backed by the full taxing power of
a municipality or by the revenues from a specific project or the credit of
a private organization.
REPURCHASE AGREEMENTS. In a repurchase agreement, a Portfolio buys a
security at one price and simultaneously agrees to sell it back at a higher
price. Delays or losses could result if the other party to the agreement
defaults or becomes insolvent.
RESTRICTED SECURITIES cannot be sold to the public without
registration under the Securities Act of 1933. Unless registered for sale,
these securities can only be sold in privately negotiated transactions or
pursuant to an exemption from registration.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a
Portfolio sells a portfolio instrument to another party, such as a bank or
broker-dealer, in return for cash. At the same time, a Portfolio agrees to
repurchase the instrument at a particular price and date. A Portfolio
expects that it will engage in reverse repurchase agreements for temporary
purposes such as to fund redemption requests, or when it is able to invest
the cash so acquired at a rate higher than the cost of the agreement, which
would increase the income earned by a Portfolio. Reverse repurchase
agreements may increase the risk of fluctuation in the market value of a
Portfolio's assets or in its yield.
STRIPPED SECURITIES are the separate income or principal
components of a debt instrument. These involve risks that are similar to
those of other debt securities, although they may be more volatile, and
certain, stripped securities move in the same direction as interest
rates.
TIME DEPOSITS are non-negotiable deposits in a banking institution
earning a specified interest rate over a given period of time.
VARIABLE OR FLOATING RATE SECURITIES have interest rates
that are periodically adjusted either at specific intervals or whenever a
benchmark rate changes. These interest rate adjustments are designed to
help stabilize the security's price.
FIDELITY MONEY MARKET TRUST
U.S. TREASURY PORTFOLIO
U.S. GOVERNMENT PORTFOLIO
DOMESTIC MONEY MARKET PORTFOLIO
STATEMENT OF ADDITIONAL INFORMATION
DECEMBER 29 , 1994
This Statement of Additional Information (SAI) is not a prospectus but
should be read in conjunction with the Portfolios' current Prospectus and
Annual Report (dated December 29 , 1994). Please retain this document
for future reference. To obtain an additional copy of the Portfolios'
Prospectus and Annual Report, please call Fidelity Distributors Corporation
at 1-800-544-8888.
TABLE OF CONTENTS PAGE
Investment Policies and Limitations
Portfolio Transactions
Valuation of Portfolio Securities
Performance
Additional Purchase and Redemption Information
Distributions and Taxes
FMR
Trustees and Officers
Management Contracts
Distribution and Service Plan
Description of the Trust
Financial Statements
Appendix
INVESTMENT ADVISER
Fidelity Management & Research Company (FMR)
SUB-ADVISER
FMR Texas Inc. (FMR Texas)
DISTRIBUTOR
Fidelity Distributors Corporation (FDC)
TRANSFER AGENT
Fidelity Investments Institutional Operations Company (FIIOC)
CUSTODIAN
Morgan Guaranty Trust Company of New York
FMMT-ptb-1294
INVESTMENT POLICIES AND LIMITATIONS
The following policies and limitations supplement those set forth in the
Prospectus. Unless otherwise noted, whenever an investment policy or
limitation states a maximum percentage of a Portfolio's assets that may be
invested in any security or other asset, or sets forth a policy regarding
quality standards, such standard or percentage limitation shall be
determined immediately after and as a result of the Portfolio's acquisition
of such security or other asset. Accordingly, any subsequent change in
values, net assets or other circumstances will not be considered when
determining whether the investment complies with a Portfolio's investment
policies and limitations.
Each Portfolio's fundamental investment policies and limitations may not be
changed without approval by a "majority of the outstanding voting
securities" (as defined in the Investment Company Act of 1940 (1940 Act))
of the Portfolio. However, except for the fundamental investment
limitations set forth below, the investment policies and limitations
described in this SAI are not fundamental and may be changed without
shareholder approval. THE FOLLOWING ARE EACH PORTFOLIO'S INVESTMENT
LIMITATIONS SET FORTH IN THEIR ENTIRETY.
FUNDAMENTAL INVESTMENT LIMITATIONS OF U.S. TREASURY PORTFOLIO
THE PORTFOLIO MAY NOT:
1. with respect to 75% of the Portfolio's total assets, purchase the
securities of any issuer (other than securities issued or guaranteed as to
principal by the U.S. government or any of its agencies or
instrumentalities) if, as a result, (a) more than 5% of the Portfolio's
total assets would be invested in the securities of that issuer, or (b) the
Portfolio would hold more than 10% of the outstanding voting securities of
that issuer;
2. issue senior securities, except as permitted under the Investment
Company Act of 1940;
3. make short sales of securities;
4. purchase securities on margin (but a Portfolio may obtain such
credits as may be necessary for the clearance of purchases and sales of
securities);
5. borrow money, except that a Portfolio may borrow money for temporary
or emergency purposes (not for leveraging or investment) or engage in
reverse repurchase agreements in an amount not exceeding 33 1/3% of the
value of its total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that come to exceed 33 1/3% of the
value of the Portfolio's total assets by reason of a decline in net assets
will be reduced within three business days to the extent necessary to
comply with the 33 1/3% limitation;
6. underwrite securities issued by others, except to the extent that the
Portfolio may be considered an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted securities;
7. purchase the securities of any issuer (other than obligations issued or
guaranteed as to principal and interest by the government of the United
States, its agencies or instrumentalities) if, as a result, more than 25%
of its total assets would be invested in the securities of one or more
issuers having their principal business activities in the same industry;
provided, however, that it may invest more than 25% of its total assets in
the obligations of banks. Neither finance companies as a group nor utility
companies as a group are considered a single industry for purposes of this
policy;
8. purchase or sell real estate unless acquired as a result of ownership of
securities or other instruments (but this shall not prevent the Portfolio
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
9. buy or sell commodities, or commodity (futures) contracts;
10. lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties (but this limit
does not apply to purchases of debt securities or to repurchase
agreements);
11. invest in oil, gas or other mineral exploration or development
programs; or
12. write or purchase any put or call option.
13. The Portfolio may, notwithstanding any other fundamental investment
policy or limitation, invest all of its assets in the securities of a
single open-end management investment company with substantially the same
fundamental investment objective, policies and limitations as the
Portfolio.
Limitation 10 does not apply to options attached to, or acquired or traded
together with, their underlying securities, and does not apply to
securities that incorporate features similar to options.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The Portfolio does not currently intend to purchase a security (other
than a security issued or guaranteed by the U.S. government or any of its
agencies or instrumentalities) if, as a result, more than 5% of its total
assets would be invested in the securities of a single issuer; provided
that the Portfolio may invest up to 10% of its total assets in the first
tier securities of a single issuer for up to three business days.
(ii) The Portfolio may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an affiliate
serves as investment adviser, or (b) by engaging in reverse repurchase
agreements with any party. The Portfolio will not purchase any security
while borrowing (excluding reverse repurchase agreements) representing more
than 5% of its total assets are outstanding. The Portfolio will not borrow
from other funds advised by FMR or its affiliates if total outstanding
borrowings immediately after such borrowing would exceed 15% of the
Portfolio's total assets.
(iii) The Portfolio does not currently intend to purchase any security if,
as a result, more than 10% of its net assets would be invested in
securities that are deemed to be illiquid because they are subject to legal
or contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(iv) The Portfolio does not currently intend to make loans, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(v) The Portfolio does not currently intend to purchase the securities of
any issuer (other than securities issued or guaranteed by domestic or
foreign governments or political subdivisions thereof) if, as a result,
more than 5% of its total assets would be invested in the securities of
business enterprises that, including predecessors, have a record of less
than three years of continuous operation.
(vi) The Portfolio does not currently intend to purchase the securities of
any issuer if those officers and Trustees of the Trust and those officers
and directors of FMR who individually own more than 1/2 of 1% of the
securities of such issuer together own more than 5% of such issuer's
securities.
(vii) The Portfolio does not currently intend to (a) purchase securities of
other investment companies, except in the open market where no commission
except the ordinary broker's commission is paid, or (b) purchase or retain
securities issued by other open-end investment companies. Limitations (a)
and (b) do not apply to securities received as dividends, through offers of
exchange, or as a result of reorganization, consolidation, or merger.
(viii) The Portfolio does not currently intend to invest all of its assets
in the securities of a single open-end management investment company with
the same fundamental investment objective, policies, and limitations as the
Portfolio.
FUNDAMENTAL INVESTMENT LIMITATIONS OF U.S. GOVERNMENT PORTFOLIO
THE PORTFOLIO MAY NOT:
1. with respect to 75% of the Portfolio's total assets, purchase the
securities of any issuer (other than securities issued or guaranteed as to
principal by the U.S. government or any of its agencies or
instrumentalities) if, as a result, (a) more than 5% of the Portfolio's
total assets would be invested in the securities of that issuer, or (b) the
Portfolio would hold more than 10% of the outstanding voting securities of
that issuer;
2. issue senior securities, except as permitted under the Investment
Company Act of 1940;
3. borrow money, except that the Portfolio may (i) borrow money for
temporary or emergency purposes (not for leveraging or investment), and
(ii) engage in reverse repurchase agreements for any purpose; provided that
(i) and (ii) in combination do not exceed 33 1/3% of the Portfolio's total
assets (including the amount borrowed) less liabilities (other than
borrowings). Any borrowings that come to exceed this amount will be reduced
within three days (not including Sundays and holidays) to the extent
necessary to comply with the 33 1/3% limitation;
4. underwrite securities issued by others, except to the extent that the
Portfolio may be considered an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted securities;
5. purchase the securities of any issuer (other than obligations issued or
guaranteed as to principal and interest by the government of the United
States, its agencies or instrumentalities) if, as a result, more than 25%
of its total assets would be invested in the securities of one or more
issuers having their principal business activities in the same industry;
provided, however, that it may invest more than 25% of its total assets in
the obligations of banks. Neither finance companies as a group nor utility
companies as a group are considered a single industry for purposes of this
policy;
6. purchase or sell real estate unless acquired as a result of ownership of
securities or other instruments (but this shall not prevent the Portfolio
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
7. purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments;
8. lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties (but this limit
does not apply to purchases of debt securities or to repurchase
agreements);
9. invest in oil, gas or other mineral exploration or development programs;
or
10. write or purchase any put or call option.
11. The Portfolio may, notwithstanding any other fundamental investment
policy or limitation, invest all of its assets in the securities of a
single open-end management investment company with substantially the same
fundamental investment objective, policies and limitations as the
Portfolio.
Limitation 10 does not apply to options attached to, or acquired or traded
together with, their underlying securities, and does not apply to
securities that incorporate features similar to options.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The Portfolio does not currently intend to purchase a security (other
than a security issued or guaranteed by the U.S. government or any of its
agencies or instrumentalities) if, as a result, more than 5% of its total
assets would be invested in the securities of a single issuer; provided
that the Portfolio may invest up to 10% of its total assets in the first
tier securities of a single issuer for up to three business days.
(ii) The Portfolio may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an affiliate
serves as investment adviser, or (b) by engaging in reverse repurchase
agreements with any party. The Portfolio will not purchase any security
while borrowing (excluding reverse repurchase agreements) representing more
than 5% of its total assets are outstanding. The Portfolio will not borrow
from other funds advised by FMR or its affiliates if total outstanding
borrowings immediately after such borrowing would exceed 15% of the
Portfolio's total assets.
(iii) The Portfolio does not currently intend to sell securities short,
unless it owns or has the right to obtain securities equivalent in kind and
amount to the securities sold short, and provided that transactions in
futures contracts and options are not deemed to constitute selling
securities short.
(iv) The Portfolio does not currently intend to purchase any security if,
as a result, more than 10% of its net assets would be invested in
securities that are deemed to be illiquid because they are subject to legal
or contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The Portfolio does not currently intend to make loans, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(vi) The Portfolio does not currently intend to purchase the securities of
any issuer (other than securities issued or guaranteed by domestic or
foreign governments or political subdivisions thereof) if, as a result,
more than 5% of its total assets would be invested in the securities of
business enterprises that, including predecessors, have a record of less
than three years of continuous operation.
(vii) The Portfolio does not currently intend to purchase the securities of
any issuer if those officers and Trustees of the Trust and those officers
and directors of FMR who individually own more than 1/2 of 1% of the
securities of such issuer together own more than 5% of such issuer's
securities.
(viii) The Portfolio does not currently intend to purchase securities on
margin, except that the Portfolio may obtain such short-term credits as are
necessary for the clearance of transactions, and provided that margin
payments in connection with futures contracts and options on futures
contracts shall not constitute purchasing securities on margin.
(ix) The Portfolio does not currently intend to (a) purchase securities of
other investment companies, except in the open market where no commission
except the ordinary broker's commission is paid, or (b) purchase or retain
securities issued by other open-end investment companies. Limitations (a)
and (b) do not apply to securities received as dividends, through offers of
exchange, or as a result of reorganization, consolidation, or merger.
(x) The Portfolio does not currently intend to invest all of its assets in
the securities of a single open-end management investment company with the
same fundamental investment objective, policies, and limitations as the
Portfolio.
FUNDAMENTAL INVESTMENT LIMITATIONS OF DOMESTIC MONEY MARKET
PORTFOLIO
THE PORTFOLIO MAY NOT:
1. with respect to 75% of the Portfolio's total assets, purchase the
securities of any issuer (other than securities issued or guaranteed as to
principal by the U.S. government or any of its agencies or
instrumentalities) if, as a result, (a) more than 5% of the Portfolio's
total assets would be invested in the securities of that issuer, or (b) the
Portfolio would hold more than 10% of the outstanding voting securities of
that issuer;
2. issue senior securities, except as permitted under the Investment
Company Act of 1940;
3. borrow money, except that the Portfolio may (i) borrow money for
temporary or emergency purposes (not for leveraging or investment), and
(ii) engage in reverse repurchase agreements for any purpose; provided that
(i) and (ii) in combination do not exceed 33 1/3% of the Portfolio's total
assets (including the amount borrowed) less liabilities (other than
borrowings). Any borrowings that come to exceed this amount will be reduced
within three days (not including Sundays and holidays) to the extent
necessary to comply with the 33 1/3% limitation;
4. underwrite securities issued by others, except to the extent that the
Portfolio may be considered an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted securities;
5. 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 its total assets would
be invested in the securities of companies whose principal business
activities are in the same industry; except that it will invest more than
25% of its total assets in the financial services industry.
6. purchase or sell real estate unless acquired as a result of ownership of
securities or other instruments (but this shall not prevent the Portfolio
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
7. purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments;
8. lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties (but this limit
does not apply to purchases of debt securities or to repurchase
agreements);
9. invest in oil, gas or other mineral exploration or development programs;
or
10. write or purchase any put or call option.
11. The Portfolio may, notwithstanding any other fundamental investment
policy or limitation, invest all of its assets in the securities of a
single open-end management investment company with substantially the same
fundamental investment objectives, policies and limitations as the
Portfolio.
Limitation 10 does not apply to options attached to, or acquired or traded
together with, their underlying securities, and does not apply to
securities that incorporate features similar to options.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The Portfolio does not currently intend to purchase a security (other
than a security issued or guaranteed by the U.S. government or any of its
agencies or instrumentalities) if, as a result, more than 5% of its total
assets would be invested in the securities of a single issuer; provided
that the Portfolio may invest up to 10% of its total assets in the first
tier securities of a single issuer for up to three business days.
(ii) The Portfolio may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an affiliate
serves as investment adviser, or (b) by engaging in reverse repurchase
agreements with any party. The Portfolio will not purchase any security
while borrowing (excluding reverse repurchase agreements) representing more
than 5% of its total assets are outstanding. The Portfolio will not borrow
from other funds advised by FMR or its affiliates if total outstanding
borrowings immediately after such borrowing would exceed 15% of the
Portfolio's total assets.
(iii) The Portfolio does not currently intend to sell securities short,
unless it owns or has the right to obtain securities equivalent in kind and
amount to the securities sold short, and provided that transactions in
futures contracts and options are not deemed to constitute selling
securities short.
(iv) The Portfolio does not currently intend to purchase any security if,
as a result, more than 10% of its net assets would be invested in
securities that are deemed to be illiquid because they are subject to legal
or contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(iv) The Portfolio does not currently intend to lend assets other than
securities to other parties, except by lending money (up to 10% of the
Portfolio's net assets) to a registered investment company or portfolio for
which FMR or an affiliate serves as investment adviser. This limitation
does not apply to purchases of debt securities or to repurchase agreements.
(v) The Portfolio does not currently intend to purchase the securities of
any issuer (other than securities issued or guaranteed by domestic or
foreign governments or political subdivisions thereof) if, as a result,
more than 5% of its total assets would be invested in the securities of
business enterprises that, including predecessors, have a record of less
than three years of continuous operation.
(vi) The Portfolio does not currently intend to purchase the securities of
any issuer if those officers and Trustees of the Trust and those officers
and directors of FMR who individually own more than 1/2 of 1% of the
securities of such issuer together own more than 5% of such issuer's
securities.
(viii) The Portfolio does not currently intend to purchase securities on
margin, except that the Portfolio may obtain such short-term credits as are
necessary for the clearance of transactions, and provided that margin
payments in connection with futures contracts and options on futures
contracts shall not constitute purchasing securities on margin.
(ix) The Portfolio does not currently intend to (a) purchase securities of
other investment companies, except in the open market where no commission
except the ordinary broker's commission is paid, or (b) purchase or retain
securities issued by other open-end investment companies. Limitations (a)
and (b) do not apply to securities received as dividends, through offers of
exchange, or as a result of reorganization, consolidation, or merger.
(x) The Portfolio does not currently intend to invest all of its assets in
the securities of a single open-end management investment company with the
same fundamental investment objective, policies, and limitations as the
Portfolio.
For the purposes of U.S. Treasury Portfolio's and U.S. Government
Portfolio's investment limitation 5, the Securities and Exchange Commission
(SEC) currently defines the term "bank" to include U.S. banks and their
domestic branches and domestic branches of foreign banks if their
obligations are guaranteed by the U.S. bank.
For the Portfolios' policies on quality and maturity, see the section
entitled "Quality and Maturity" below .
Each Portfolio's investments must be consistent with its investment
objective and policies. Accordingly, not all of the security types and
investment techniques discussed below are eligible investments for each of
the Portfolios.
AFFILIATED BANK TRANSACTIONS. A Portfolio may engage in transactions with
financial institutions that are, or may be considered to be, "affiliated
persons" of the Portfolios under the 1940 Act. These transactions may
include repurchase agreements with custodian banks; short-term obligations
of, and repurchase agreements with, the 50 largest U.S. banks (measured by
deposits); municipal securities; U.S. government securities with affiliated
financial institutions that are primary dealers in these securities;
short-term currency transactions; and short-term borrowings. In accordance
with exemptive orders issued by the SEC, the Board of Trustees has
established and periodically reviews procedures applicable to transactions
involving affiliated financial institutions.
ASSET-BACKED SECURITIES include interests in pools of mortgages,
loans, receivables, or other assets. Payment of princip al and
interest may be largely dependent upon the cash flows generated by the
assets backing the securities, and, in certain cases, supported by letters
of credit, surety bonds, or other credit enhancements. The value of
asset-backed securities may also be affected by the creditworthiness of the
servicing agent for the pool, the originator of the loans or receivables,
or the financial institution(s) providing the credit support.
DELAYED DELIVERY TRANSACTIONS. The Portfolios may buy and sell securities
on a delayed delivery or when-issued basis. These transactions involve a
commitment by the Portfolios to purchase or sell specific securities at a
predetermined price and/or yield, with payment and delivery taking place
after the customary settlement period for that type of security (and more
than seven days in the future). Typically, no interest accrues to the
purchaser until the security is delivered.
When purchasing securities on a delayed delivery basis, a Portfolio assumes
the rights and risks of ownership, including the risk of price and yield
fluctuations. Because a Portfolio is not required to pay for securities
until the delivery date, these risks are in addition to the risks
associated with each Portfolio's other investments. If a Portfolio remains
substantially fully invested at a time when delayed delivery purchases are
outstanding, the delayed delivery purchases may result in a form of
leverage. When delayed delivery purchases are outstanding, a Portfolio will
set aside appropriate liquid assets in a segregated custodial account to
cover its purchase obligations. When a Portfolio has sold a security on a
delayed delivery basis, the Portfolio does not participate in further gains
or losses with respect to the security. If the other party to a delayed
delivery transaction fails to deliver or pay for the securities, a
Portfolio could miss a favorable price or yield opportunity, or could
suffer a loss.
The Portfolios may renegotiate delayed delivery transactions after they are
entered into, and may sell underlying securities before they are delivered,
which may result in a capital gains or losses.
ILLIQUID INVESTMENTS are investments that cannot be sold or disposed of in
the ordinary course of business at approximately the prices at which they
are valued. Under the supervision of the Board of Trustees, FMR determines
the liquidity of a Portfolio's investments and, through reports from FMR,
the Board monitors investments in illiquid instruments. In determining the
liquidity of a Portfolio's investments, FMR may consider various factors
including (1) the frequency of trades and quotations, (2) the number of
dealers and prospective purchasers in the marketplace, (3) dealer
undertakings to make a market, (4) the nature of the security (including
any demand or tender features) and (5) the nature of the marketplace for
trades (including the ability to assign or offset the Portfolio's rights
and obligations relating to the investment). Investments currently
considered to be illiquid include repurchase agreements not entitling the
holder to payment of principal and interest within seven days. Also, with
respect to Domestic Money Market Portfolio, FMR may determine some
restricted securities and time deposits to be illiquid. In the absence of
market quotations, illiquid investments are valued for purposes of
monitoring amortized cost valuation at fair value as determined in good
faith by a committee appointed by the Board of Trustees. If through a
change in values, net assets or other circumstances, the Portfolio were in
a position where 10% or more of its net assets were invested in illiquid
securities, it would seek to take appropriate steps to protect liquidity.
PUT FEATURES entitle the holder to resell a security to the
issuer or a third party at any time or at specified intervals. They are
subject to the risk that the put provider is unable to honor the put
feature (purchase the security). Put providers often support their ability
to buy securities on demand by obtaining letters of credit or other
guarantees from domestic or foreign banks. FMR may rely on its evaluation
of a bank's credit in determining whether to purchase a security supported
by a letter of credit. Demand features, standby commitments, and tender
options are types of put features.
QUALITY AND MATURITY. Pursuant to procedures adopted by the Board of
Trustees, the Portfolios may purchase only high-quality securities that FMR
believes present minimal credit risks. To be considered high-quality, a
security must be rated in accordance with applicable rules in one of the
two highest categories for short-term securities by at least two nationally
recognized rating services (or by one, if only one rating service has rated
the security); or, if unrated, judged to be of equivalent quality by FMR.
High-quality securities are divided into "first tier" and "second tier"
securities. First tier securities are those deemed to be in the
highest rating category (e.g. Standard & Poor's A-1 ). Second
tier securities are those deemed to be in the second highest rating
category (e.g. Standard & Poor's A-2) .
Domestic Money Market Portfolio may not invest more than 5% of its total
assets in second tier securities. In addition, the Domestic Money Market
Portfolio may not invest more than 1% of its total assets or $1 million
(whichever is greater) in the second tier securities of a single issuer.
Each Portfolio currently intends to limit its investments to
securities with remaining maturities of 397 days or less, and to maintain a
dollar-weighted average maturity of 90 days or less. When determining
the maturity of a security, a portfolio may look to an interest rate reset
or demand feature.
REPURCHASE AGREEMENTS. In a repurchase agreement, a Portfolio
purchases a security and simultaneously commits to resell that security to
the original seller at an agreed-upon price. The resale price reflects the
purchase price plus incremental amount which is unrelated to the coupon
rate or maturity of the purchased security. While it does not presently
appear possible to eliminate all risks from these transactions (a Portfolio
particularly the possibility that the value of the underlying security will
be less than the resale price as well as delays and costs to a Portfolio in
connection with bankruptcy proceedings), it is each Portfolio's current
policy to engage in repurchase agreement transactions with whose
creditworthiness has been reviewed and found satisfactory by FMR.
RESTRICTED SECURITIES generally can be sold in privately negotiated
transactions, pursuant to an exemption from registration under the
Securities Act of 1933, or in a registered public offering. Where
registration is required, a Portfolio may be obligated to pay all or
part of the registration expense and a considerable period may elapse
between the time it decides to seek registration and the time it may be
permitted to sell a security under an effective registration statement. If,
during such a period, adverse market conditions were to develop, a
Portfolio might obtain a less favorable price than prevailed when it
decided to seek registration of the security. However, in general,
each Portfolio anticipates holding restricted securities to maturity
or selling them in an exempt transaction.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a
Portfolio sells a portfolio instrument to another party, such as a bank or
broker-dealer, in return for cash and agrees to repurchase the instrument
at a particular price and time. While a reverse repurchase agreement is
outstanding, a Portfolio will maintain appropriate liquid assets in a
segregated custodial account to cover its obligation under the agreement. A
Portfolio will enter into reverse repurchase agreements only with parties
whose creditworthiness has been found satisfactory by FMR. Such
transactions may increase fluctuations in the market value of a Portfolio's
assets and may be viewed as a form of leverage.
SHORT SALES AGAINST THE BOX. A Portfolio may sell securities short when it
owns or has the right to obtain securities equivalent in kind or amount to
the securities sold short. Short sales could be used to protect the net
asset value per share (NAV) of a Portfolio in anticipation of increased
interest rates without sacrificing the current yield of the securities sold
short. If a Portfolio enters into a short sale against the box, it will be
required to set aside securities equivalent in kind and amount to the
securities sold short (or securities convertible or exchangeable into such
securities) and will be required to continue to hold such securities while
the short sale is outstanding. A Portfolio will incur transaction costs,
including interest expenses, in connection with opening, maintaining and
closing short sales against the box.
STRIPPED GOVERNMENT SECURITIES are created by separating the income and
principal components of a debt instrument and selling them separately. Each
Portfolio may purchase U.S. Treasury STRIPS (Separate Trading of Registered
Interest and Principal of Securities), that are created when the coupon
payments and the principal payment are stripped from an outstanding
Treasury bond by the Federal Reserve Bank. Bonds issued by the Resolution
Funding Corporation (REFCORP) can also be stripped in this fashion. REFCORP
Strips are eligible investments for the Portfolios.
Domestic Money Market Portfolio can purchase privately stripped government
securities, which are created when a dealer deposits a Treasury security or
federal agency security with a custodian for safekeeping and then sells the
coupon payments and principal payment that will be generated by this
security. Proprietary receipts, such as Certificates of Accrual on Treasury
Securities (CATS), Treasury Investment Growth Receipts (TIGRS), and generic
Treasury Receipts (TRs), are stripped U.S. Treasury securities that are
separated into their component parts through trusts created by their broker
sponsors. Bonds issued by the Financing Corporation (FICO) can also be
stripped in this fashion.
Because of the SEC's views on privately stripped government securities,
Domestic Money Market Portfolio must evaluate them as it would
non-government securities pursuant to regulatory guidelines applicable to
all money market funds. Accordingly, the Portfolio intends to purchase only
those privately stripped government securities that have either received
the highest rating from two nationally recognized rating services (or one,
if only one has rated the security), or, if unrated, been judged to be of
equivalent quality by FMR pursuant to procedures adopted by the Board of
Trustees.
VARIABLE AND FLOATING RATE SECURITIES provide for periodic
adjustments of the interest rate paid. Variable rate securities provide for
a specified periodic adjustment in the interest rate, while floating rate
securities have interest rates that change whenever there is a change in a
designated benchmark rate. Some variable or floating rate securities have
put features.
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are placed on
behalf of each Portfolio by FMR pursuant to authority contained in the
management contract. If FMR grants investment management authority to the
sub-adviser (see the section entitled "Management Contracts"), the
sub-adviser will be authorized to place orders for the purchase and sale of
portfolio securities, and will do so in accordance with the policies
described below. FMR is also responsible for the placement of transaction
orders for other investment companies and accounts for which it or its
affiliates act as investment adviser. Securities purchased and sold by the
Portfolios generally will be traded on a net basis (i.e., without
commission). In selecting broker-dealers, subject to applicable limitations
of the federal securities laws, FMR considers various relevant factors,
including, but not limited to, the size and type of the transaction; the
nature and character of the markets for the security to be purchased or
sold; the execution efficiency, settlement capability, and financial
condition of the broker-dealer firm; the broker-dealer's execution services
rendered on a continuing basis; and the reasonableness of any commissions.
The Portfolios may execute portfolio transactions with broker-dealers who
provide research and execution services to the Portfolios or other accounts
over which FMR or its affiliates exercise investment discretion. Such
services may include advice concerning the value of securities; the
advisability of investing in, purchasing, or selling securities; the
availability of securities or the purchasers or sellers of securities;
furnishing analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy and performance of
accounts; and effecting securities transactions and performing functions
incidental thereto (such as clearance and settlement). FMR maintains a
listing of broker-dealers who provide such services on a regular basis.
However, as many transactions on behalf of the Portfolios are placed with
broker-dealers (including broker-dealers on the list) without regard to the
furnishing of such services, it is not possible to estimate the proportion
of such transactions directed to such broker-dealers solely because such
services were provided. The selection of such broker-dealers generally is
made by FMR (to the extent possible consistent with execution
considerations) based upon the quality of research and execution services
provided.
The receipt of research from broker-dealers that execute transactions on
behalf of the Portfolios may be useful to FMR in rendering investment
management services to the Portfolios or its other clients, and conversely,
such research provided by broker-dealers who have executed transaction
orders on behalf of other FMR clients may be useful to FMR in carrying out
its obligations to the Portfolios. The receipt of such research has not
reduced FMR's normal independent research activities; however, it enables
FMR to avoid the additional expenses that could be incurred if FMR tried to
develop comparable information through its own efforts.
Subject to applicable limitations of the federal securities laws,
broker-dealers may receive commissions for agency transactions that are in
excess of the amount of commissions charged by other broker-dealers in
recognition of their research and execution services. In order to cause the
Portfolios to pay such higher commissions, FMR must determine in good faith
that such commissions are reasonable in relation to the value of the
brokerage and research services provided by such executing broker-dealers,
viewed in terms of a particular transaction or FMR's overall
responsibilities to the Portfolios and its other clients. In reaching this
determination, FMR will not attempt to place a specific dollar value on the
brokerage and research services provided, or to determine what portion of
the compensation should be related to those services.
FMR is authorized to use research services provided by, and to place
portfolio transactions with, brokerage firms that have provided assistance
in the distribution of shares of the Portfolios or shares of other Fidelity
funds to the extent permitted by law. FMR may use research services
provided by and place agency transactions with Fidelity Brokerage Services,
Inc. (FBSI) and Fidelity Brokerage Services, Ltd. (FBSL), subsidiaries of
FMR Corp., if the commissions are fair, reasonable, and comparable to
commissions charged by non-affiliated, qualified brokerage firms for
similar services.
Section 11(a) of the Securities Exchange Act of 1934 prohibits members of
national securities exchanges from executing exchange transactions for
accounts which they or their affiliates manage, unless certain requirements
are satisfied. Pursuant to such requirements, the Board of Trustees has
authorized FBSI to execute portfolio transactions on national securities
exchanges in accordance with approved procedures and applicable SEC rules.
The Trustees periodically review FMR's performance of its responsibilities
in connection with the placement of portfolio transactions on behalf of the
Portfolios and review the commissions paid by each Portfolio over
representative periods of time to determine if they are reasonable in
relation to the benefits to each Portfolio.
From time to time the Trustees will review whether the recapture for the
benefit of the Portfolios of some portion of the brokerage commissions or
similar fees paid by the Portfolios on portfolio transactions is legally
permissible and advisable. Each Portfolio seeks to recapture soliciting
broker-dealer fees on the tender of portfolio securities, but at present no
other recapture arrangements are in effect. The Trustees intend to continue
to review whether recapture opportunities are available and are legally
permissible and, if so, to determine, in the exercise of their business
judgment whether it would be advisable for each Portfolio to seek such
recapture.
Although the Trustees and officers of each Portfolio are substantially the
same as those of other funds managed by FMR, investment decisions for each
Portfolio are made independently from those of other funds managed by FMR
or accounts managed by FMR affiliates. It sometimes happens that the same
security is held in the portfolio of more than one of these funds or
accounts. Simultaneous transactions are inevitable when several funds are
managed by the same investment adviser, particularly when the same security
is suitable for the investment objective of more than one fund or account.
When two or more funds are simultaneously engaged in the purchase or sale
of the same security, the prices and amounts are allocated in accordance
with procedures believed to be appropriate and equitable for each
Portfolio. In some cases this system could have a detrimental effect on the
price or value of the security as far as each Portfolio is concerned. In
other cases, however, the ability of the Portfolios to participate in
volume transactions will produce better executions and prices for the
Portfolios. It is the current opinion of the Trustees that the desirability
of retaining FMR as investment adviser to each Portfolio outweighs any
disadvantages that may be said to exist from exposure to simultaneous
transactions.
VALUATION OF PORTFOLIO SECURITIES
Each Portfolio values its investments on the basis of amortized cost. This
technique involves valuing an instrument at its cost as adjusted for
amortization of premium or accretion of discount rather than its value
based on current market quotations or appropriate substitutes which reflect
current market conditions. The amortized cost value of an instrument may be
higher or lower than the price the Portfolio would receive if it sold the
instrument.
Valuing each Portfolio's instruments on the basis of amortized cost and use
of the term "money market fund" are permitted by Rule 2a-7 under the 1940
Act. Each Portfolio must adhere to certain conditions under Rule
2a-7; these conditions are summarized in the Prospectus.
The Board of Trustees of the Trust oversees FMR's adherence to SEC rules
concerning money market funds, and has established procedures designed to
stabilize each Portfolio's NAV at $1.00. At such intervals as they
deem appropriate, the Trustees consider the extent to which NAV calculated
by using market valuations would deviate from $1.00 per share. If the
Trustees believe that a deviation from a Portfolio's amortized cost
per share may result in material dilution or other unfair results to
shareholders, the Trustees have agreed to take such corrective action, if
any, as they deem appropriate to eliminate or reduce, to the extent
reasonably practicable, the dilution or unfair results. Such corrective
action could include selling portfolio instruments prior to maturity to
realize capital gains or losses or to shorten average portfolio maturity;
withholding dividends; redeeming shares in kind; establishing NAV by using
available market quotations; and such other measures as the Trustees may
deem appropriate.
During periods of declining interest rates, a Portfolio's yield based on
amortized cost may be higher than the yield based on market valuations.
Under these circumstances, a shareholder in the Portfolio would be able to
obtain a somewhat higher yield than would result if the Portfolio utilized
market valuations to determine its NAV. The converse would apply in a
period of rising interest rates.
PERFORMANCE
From time to time each Portfolio advertises its yield and effective yield
in advertisements or in reports or other communications with shareholders.
Both yield figures are based on historical earnings and are not intended to
indicate future performance. The net change in value of a hypothetical
account containing one share reflects the value of additional shares
purchased with dividends from the one original share and dividends declared
on both the original share and any additional shares. This income is then
annualized. That is, the amount of income generated by the investment
during that week is assumed to be generated each week over a 52-week period
and is shown as a percentage of the investment. The effective yield is
calculated similarly but, when annualized, the income earned by an
investment in each Portfolio is assumed to be reinvested. The effective
yield will be slightly higher than the yield because of the compounding
effect of this assumed reinvestment. In addition to the current yield, the
Portfolios may quote yields in advertising based on any historical seven
day period.
Each Portfolio's yield and effective yield figures are illustrated below
for the seven-day period ended August 31, 1994.
Yield Effective
Yield
U.S. Treasury Portfolio 4.23 % 4.32 %
U.S. Government Portfolio 4.22 % 4.31 %
Domestic Money Market Portfolio 4.37 % 4.47 %
Yield information may be useful in reviewing each Portfolio's performance
and for providing a basis for comparison with other investment
alternatives. Each Portfolio's yield will fluctuate, unlike investments
which pay a fixed yield for a stated period of time.
TOTAL RETURN CALCULATIONS: Total returns quoted in advertising reflect all
aspects of a Portfolio's return, including the effect of reinvesting
dividends and capital gain distributions (if any). Average annual returns
are calculated by determining the growth or decline in value of a
hypothetical historical investment in a Portfolio over a stated period and
then calculating the annually compounded percentage rate that would have
produced the same results if the rate of growth or decline in the value of
the investment had been constant over that period. For example, a
cumulative return of 100% over ten years would produce an average annual
return of 7.18%, which is the steady annual rate that would equal 100%
growth on a compounded basis in ten years. While average annual returns are
a convenient means of comparing investment alternatives, investors should
realize that a Portfolio's performance is not constant over time, but
changes from year to year, and that average annual returns represent
averaged figures as opposed to the actual year-to-year performance of a
Portfolio.
In addition to average annual returns, a Portfolio may quote unaveraged or
cumulative total returns reflecting the simple change in the value of an
investment over a stated period. Average annual and cumulative total
returns may be quoted as percentages or as dollar amounts and may be
calculated for a single investment, as series of investments or a series of
redemptions over any time period. Total returns may be broken down into
their components of income and capital in order to illustrate the
relationship of these factors and their contributions to total return.
Total returns, yields, and other performance information may be quoted
numerically or in a table, graph, or similar illustration. Each Portfolio's
cumulative total returns and average annual returns for the fiscal year
ended August 31, 1994 were as follows:
HISTORICAL PORTFOLIO RESULTS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
U. S. TREASURY PORTFOLIO
One Year Five Year Ten Year
Average Annual Total Returns 3.21 % 5.06 % 6.27 %
Cumulative Total Returns 3.21 % 27.99 % 83.74 %
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
U. S. GOVERNMENT PORTFOLIO
One Year Five Year Ten Year
Average Annual Total Returns 3.29 % 5.15 % 6.40 %
Cumulative Total Returns 3.29 % 28.56 % 85.96 %
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
DOMESTIC MONEY MARKET PORTFOLIO
One Year Five Year Ten Year
Average Annual Total Returns 3.34 % 5.16 % 6.46 %
Cumulative Total Returns 3.34 % 28.62 % 86.93 %
</TABLE>
The following chart shows the income and capital elements of each
Portfolio's year-by-year total returns from October 31, 1984 through August
31, 1994 as compared to the cost of living measured by the Consumer Price
Index (CPI) over the same periods. During this period, a hypothetical
investment of $10,000 in U. S. Treasury Portfolio, U. S. Government
Portfolio and Domestic Money Market Portfolio would have grown to
$18,067, $18,284, $18,360 , respectively, assuming all dividends were
invested.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
PERIOD ENDED INITIAL VALUE OF VALUE OF TOTAL CONSUMER
$10,000 REINVESTED REINVESTED VALUE PRICE
INVESTMENT DIVIDENDS CAPITAL GAINS INDEX
U. S. TREASURY PORTFOLIO
10/31/84 $10,000 $ 0 $ 0 $10,000 $10,000
10/31/85 10,000 807 0 10,807 10,323
10/31/86 10,000 1,547 0 11,547 10,475
10/31/87 10,000 2,262 0 12,262 10,950
10/31/88 10,000 3,118 0 13,118 11,415
10/31/89 10,000 4,320 0 14,320 11,928
10/31/90 10,000 5,492 0 15,492 12,678
10/31/91 10,000 6,459 0 16,459 13,048
08/31/92* 10,000 7,014 0 17,014 13,381
08/31/93 10,000 7,506 0 17,506 13,751
08/31/94 10,000 8,067 0 18,067 14,150
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
PERIOD ENDED INITIAL VALUE OF VALUE OF TOTAL CONSUMER
$10,000 REINVESTED REINVESTED VALUE PRICE
INVESTMENT DIVIDENDS CAPITAL GAINS INDEX
U. S. GOVERNMENT PORTFOLIO
10/31/84 $10,000 $ 0 $ 0 $10,000 $10,000
10/31/85 10,000 831 0 10,831 10,323
10/31/86 10,000 1,594 0 11,594 10,475
10/31/87 10,000 2,340 0 12,340 10,950
10/31/88 10,000 3,221 0 13,221 11,415
10/31/89 10,000 4,426 0 14,426 11,928
10/31/90 10,000 5,609 0 15,609 12,678
10/31/91 10,000 6,609 0 16,609 13,048
08/31/92* 10,000 7,195 0 17,195 13,381
08/31/93 10,000 7,702 0 17,702 13,751
08/31/94 10,000 8,284 0 18,284 14,150
</TABLE>
* The fiscal year-end of the Trust changed from October 31 to August 31 in
July 1992.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
PERIOD ENDED INITIAL VALUE OF VALUE OF TOTAL CONSUMER
$10,000 REINVESTED REINVESTED VALUE PRICE
INVESTMENT DIVIDENDS CAPITAL GAINS INDEX
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
DOMESTIC MONEY MARKET
PORTFOLIO
10/31/84 $10,000 $ 0 $0 $10,000 $10,000
10/31/85 10,000 842 0 10,842 10,323
10/31/86 10,000 1,608 0 11,608 10,475
10/31/87 10,000 2,353 0 12,353 10,950
10/31/88 10,000 3,251 0 13,251 11,415
10/31/89 10,000 4,478 0 14,478 11,928
10/31/90 10,000 5,676 0 15,676 12,678
10/31/91 10,000 6,686 0 16,686 13,048
08/31/92* 10,000 7,260 0 17,260 13,381
08/31/93 10,000 7,766 0 17,766 13,751
08/31/94 10,000 8,360 0 18,360 14,150
</TABLE>
* The fiscal year-end of the Trust changed from October 31 to August 31 in
July 1992.
EXPLANATORY NOTES: With an initial investment of $10,000 made on October
31, 1984, the net amount invested in shares of each Portfolio was $10,000.
The cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends from October 31, 1984 through August 31, 1994
for U. S. Treasury Portfolio, U.S. Government Portfolio and Domestic Money
Market Portfolio (that is, their cash value at the time they were
reinvested) amounted to $18,067, $18,284 and $18,360, respectively. If
distributions had not been reinvested, the amount of distributions earned
from each Portfolio over time would have been smaller, and the cash
payments (dividends) for the period would have amounted to $5,932,
$6,052 and $6,093 for U. S. Treasury Portfolio, U.S. Government
Portfolio and Domestic Money Market Portfolio, respectively. The Portfolios
did not distribute any capital gains during these periods.
The Portfolios may compare their performance or the performance of
securities in which they may invest to averages published by IBC USA
(Publications), Inc. of Ashland, Massachusetts. These averages assume
reinvestment of distributions. The MONEY FUND AVERAGES(registered
trademark)/Total Institutions-Only Average; Government - Only; Institutions
- - Only; First Tier Institutions - Only; and Second Tier Institutions -
Only, which are reported in the MONEY FUND REPORT, covers over 172 taxable
money market funds. When evaluating comparisons to money market funds,
investors should consider the relevant differences in investment objectives
and policies. Specifically, money market funds invest in short-term,
high-quality instruments and seek to maintain a stable $1.00 share price.
A Portfolio's performance may be compared to the performance of other
mutual funds in general, or to the performance of particular types of
mutual funds. These comparisons may be expressed as mutual fund rankings
prepared by Lipper Analytical Services, Inc. (Lipper), an independent
service located in Summit, New Jersey which monitors the performance of
mutual funds. Lipper generally ranks funds on the basis of total return,
assuming reinvestment of distributions, but does not take sales charges or
redemption fees into consideration, and is prepared without regard to tax
consequences. Lipper may also rank the funds based on yield. In addition to
the mutual fund rankings, a Portfolio's performance may be compared to
mutual fund performance indices prepared by Lipper. The Portfolios may
compare their performance to the yields on other money market securities or
averages of other money market securities as reported by the Federal
Reserve Bulletin, by TeleRate, a financial information network, or by
Salomon Brothers Inc., a broker-dealer firm; and on other fixed-income
investments such as Certificates of Deposit (CDs).
The principal value and interest rate of CDs and money market securities
are fixed at the time of purchase, whereas each Portfolio's yield will
fluctuate. Unlike some CDs and certain other money market securities, money
market mutual funds are not insured by the FDIC. Investors should give
consideration to the quality and maturity of the portfolio securities of
the respective investment companies when comparing investment alternatives.
The Portfolios may reference the growth and variety of money market mutual
funds and the adviser's innovation and participation in the industry.
Each Portfolio may reference and discuss its fund number,
Quotron(registered trademark) number, CUSIP number, and current portfolio
manager in advertising.
IBBOTSON. Ibbotson Associates of Chicago, Illinois (Ibbotson) provides
historical returns of the capital markets in the United States, including
common stocks, small capitalization stocks, long-term corporate bonds,
intermediate-term government bonds, long-term government bonds, Treasury
bills, the U.S. rate of inflation (based on the CPI), and combinations of
various capital markets. The performance of these capital markets is based
on the returns of different indices.
Fidelity funds may use the performance of these capital markets in order to
demonstrate general risk-versus-reward investment scenarios. Performance
comparisons may also include the value of a hypothetical investment in any
of these capital markets. The risks associated with the security types in
any capital market may or may not correspond directly to those of the
funds. Ibbotson calculates total returns in the same method as the funds.
The funds may also compare performance to that of other compilations or
indices that may be developed and made available in the future.
MORNINGSTAR. From time to time, in reports and promotional literature, a
Portfolio's performance also may be compared to other mutual funds tracked
by financial or business publications and periodicals. For example, a
Portfolio may quote Morningstar, Inc. in its advertising materials.
Morningstar, Inc. is a mutual fund rating service that rates mutual funds
of the basis or risk-adjusted performance. In addition, a Portfolio may
quote financial or business publications and periodicals as they relate to
fund management, investment philosophy, and investment techniques. Rankings
that compare the performance of Fidelity funds to one another in
appropriate categories over specific periods of time may also be quoted in
advertising.
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION
If the Trustees determine that existing conditions make cash payments
undesirable, redemption payments may be made in whole or in part in
securities or other property, valued for this purpose as they are valued in
computing a Portfolio's NAV. Shareholders receiving securities or other
property on redemption may realize a gain or loss for tax purposes, and
will incur any costs of sale, as well as the associated inconveniences.
Pursuant to Rule 11a-3 under the 1940 Act, each Portfolio is required to
give shareholders at least 60 days' notice prior to terminating or
modifying its exchange privilege. Under the Rule, the 60 day notification
requirement may be waived if (i) the only effect of a modification would be
to reduce or eliminate an administrative fee, redemption fee, or deferred
sales charge ordinarily payable at the time of exchange, or (ii) if
a Portfolio temporarily suspends the redemption of the shares to be
exchanged as permitted under the 1940 Act or the rules and regulations
thereunder, or the fund to be acquired suspends the sale of its shares
because it is unable to invest amounts effectively in accordance with its
investment objective and policies.
The Portfolios have notified shareholders that they reserve the right at
any time, without prior notice, to refuse exchange purchases by any person
or group if, in FMR's judgment, a Portfolio would be unable to invest
effectively in accordance with its investment objective and policies or
might otherwise be adversely affected.
DISTRIBUTIONS AND TAXES
DIVIDENDS. Dividends from each Portfolio will not normally qualify for the
dividends-received deduction available to corporations, since the
Portfolios' income is primarily derived from interest income and short-term
capital gains. Depending upon state law, a portion of each Portfolio's
dividends attributable to interest income derived from U.S. government
securities may be exempt from state and local taxation. The Portfolios will
provide information on the portion of a Portfolio's dividends, if any, that
qualify for this exemption.
CAPITAL GAIN DISTRIBUTIONS. The Portfolios may distribute short-term
capital gains once a year or more often as necessary to maintain their NAVs
at $1.00 per share or to comply with distribution requirements under
federal tax law. The Portfolios do not anticipate earning long-term capital
gains on securities held by a Portfolio.
TAX STATUS OF FUND. Each Portfolio has qualified and intends to qualify as
a "regulated investment company" under the Internal Revenue Code of 1986,
as amended (the Code), so that a Portfolio will not be liable for federal
income or excise taxes on net investment income or capital gains to the
extent that these are distributed to shareholders in accordance with
applicable provisions of the Code.
STATE AND LOCAL TAX ISSUES. For mutual funds organized as business trusts,
state laws provide for a pass-through of the state and local income tax
exemption afforded to direct owners of U.S. government securities. Some
states limit this pass through to mutual funds that invest a certain amount
in U.S. government securities, and some types of securities, such as
repurchase agreements and some agency-backed securities, but may not
qualify for this pass-through benefit. The tax treatment of your dividend
distributions from U.S. Treasury Portfolio and U.S. Government Portfolio
will be the same as if you directly owned your proportionate share of the
U.S. government securities in each Portfolio's portfolio. Because the
income earned on most U.S. government securities in which U.S. Treasury
Portfolio and U.S. Government Portfolio invest is exempt form state and
local taxes, the portion of your dividends from the Portfolios attributable
to these securities will also be free from income taxes. The exemption from
state and local income taxation does not preclude states from assessing
other taxes on the ownership of U.S. government securities.
FMR
All of the stock of FMR is owned by FMR Corp., its ultimate parent
company organized in 1972. Through ownership of voting common stock and the
execution of a shareholders' voting agreement, Edward C. Johnson 3d,
Johnson family members, and various trusts for the benefit of the Johnson
family form a controlling group with respect to FMR Corp.
At present, the principal operating activities of FMR Corp. are those
conducted by three of its divisions as follows: Fidelity Service Company
(FSC), which is the transfer and shareholder servicing agent for certain of
the funds advised by FMR; FIIOC, which performs shareholder servicing
functions for institutional customers and funds sold through
intermediaries; and Fidelity Investments Retail Marketing Company, which
provides marketing services to various companies within the Fidelity
organization.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that sets forth all employees'
fiduciary responsibilities regarding the funds, establishes procedures for
personal investing and restricts certain transactions. For example, all
personal trades in most securities require pre-clearance, and participation
in initial public offerings is prohibited. In addition, restrictions on the
timing of personal investing in relation to trades by Fidelity funds and on
short-term trading have been adopted.
TRUSTEES AND OFFICERS
The Trustees and executive officers of the Trust are listed below. Except
as indicated, each individual has held the office shown or other office in
the same company for the last five years. All persons named as Trustees and
officers also serve in similar capacities for other funds advised by FMR.
Unless otherwise noted, the business address of each Trustee and officer is
82 Devonshire Street, Boston, MA 02109, which is also the address of FMR.
Those Trustees who are "interested persons" (as defined in the 1940 Act) by
virtue of their affiliation with either the Trust or FMR, are indicated by
an asterisk (*).
*EDWARD C. JOHNSON 3d, Trustee and President, is Chairman, Chief 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 FMR Texas
Inc. (1989), Fidelity Management & Research (U.K.) Inc., and Fidelity
Management & Research (Far East) Inc.
*J. GARY BURKHEAD, Trustee and Senior Vice President, is President of FMR;
and President and a Director of FMR Texas Inc. (1989), Fidelity Management
& Research (U.K.) Inc., and Fidelity Management & Research (Far East) Inc.
RALPH F. COX, 200 Rivercrest Drive, Fort Worth, TX, Trustee (1991), is a
consultant to Western Mining Corporation (1994). Prior to February 1994, he
was President of Greenhill Petroleum Corporation (petroleum exploration and
production, 1990). Until March 1990, Mr. Cox was President and Chief
Operating Officer of Union Pacific Resources Company (exploration and
production). He is a Director of Sanifill Corporation (non-hazardous waste,
1993) and CH2M Hill Companies (engineering). In addition, he served on the
Board of Directors of the Norton Company (manufacturer of industrial
devices, 1983-1990) and continues to serve on the Board of Directors of the
Texas State Chamber of Commerce, and is a member of advisory boards of
Texas A&M University and the University of Texas at Austin.
PHYLLIS BURKE DAVIS, P.O. Box 264, Bridgehampton, N.Y., Trustee (1992).
Prior to her retirement in September 1991, Mrs. Davis was the Senior Vice
President of Corporate Affairs of Avon Products, Inc. She is currently a
Director of BellSouth Corporation (telecommunications), Eaton Corporation
(manufacturing, 1991), and the TJX Companies, Inc. (retail stores, 1990),
and previously served as a Director of Hallmark Cards, Inc. (1985-1991) and
Nabisco Brands, Inc. In addition, she is a member of the
President's Advisory Council of The University School of Vermont School of
Business Administration.
RICHARD J. FLYNN, 77 Fiske Hill, Sturbridge, MA, Trustee, is a financial
consultant. Prior to September 1986, Mr. Flynn was Vice Chairman and a
Director of the Norton Company (manufacturer of industrial devices). He is
currently a Director of Mechanics Bank and a Trustee of College of the Holy
Cross and Old Sturbridge Village, Inc.
E. BRADLEY JONES, 3881-2 Lander Road, Chagrin Falls, OH, Trustee (1990).
Prior to his retirement in 1984, Mr. Jones was Chairman and Chief Executive
Officer of LTV Steel Company. Prior to May 1990, he was Director of
National City Corporation (a bank holding company) and National City Bank
of Cleveland. He is a Director of TRW Inc. (original equipment and
replacement products), Cleveland-Cliffs Inc. (mining), NACCO Industries,
Inc. (mining and marketing), Consolidated Rail Corporation, Birmingham
Steel Corporation, Hyster-Yale Materials Handling, Inc. (1989), and RPM,
Inc. (manufacturer of chemical products, 1990). In addition, he serves as a
Trustee of First Union Real Estate Investments, Chairman of the Board of
Trustees and a member of the Executive Committee of the Cleveland Clinic
Foundation, a Trustee and a member of the Executive Committee of University
School (Cleveland), and a Trustee of Cleveland Clinic Florida.
DONALD J. KIRK, 680 Steamboat Road, Apartment #1-North, Greenwich, CT,
Trustee, is a Professor at Columbia University Graduate School of Business
and a financial consultant. Prior to 1987, he was Chairman of the Financial
Accounting Standards Board. Mr. Kirk is a Director of General Re
Corporation (reinsurance) and Valuation Research Corp. (appraisals and
valuations, 1993). In addition, he serves as Vice Chairman of the Board of
Directors of the National Arts Stabilization Fund and the Vice Chairman of
the Board of Trustees of the Greenwich Hospital Association.
*PETER S. LYNCH, Trustee (1990) is Vice Chairman of FMR (1992). Prior to
his retirement on May 31, 1990, he was a Director of FMR (1989) 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, Inc. (1991-1992). He is a Director
of W.R. Grace & Co. (chemicals, 1989) and Morrison Knudsen Corporation
(engineering and construction). 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 (1990).
GERALD C. McDONOUGH, 135 Aspenwood Drive, Cleveland, OH, Trustee (1989), is
Chairman of G.M. Management Group (strategic advisory services). Prior to
his retirement in July 1988, he was Chairman and Chief Executive Officer of
Leaseway Transportation Corp. (physical distribution services). Mr.
McDonough is a Director of ACME-Cleveland Corp. (metal working,
telecommunications and electronic products), Brush-Wellman Inc. (metal
refining), York International Corp. (air-conditioning and refrigeration,
1989), Commercial Intertech Corp. (water treatment equipment, 1992), and
Associated Estates Realty Corporation (a real estate investment trust,
1993).
EDWARD H. MALONE, 5601 Turtle Bay Drive #2104, Naples, FL, Trustee. Prior
to his retirement in 1985, Mr. Malone was Chairman, General Electric
Investment Corporation and a Vice President of General Electric Company. He
is a Director of Allegheny Power Systems, Inc. (electric utility), General
Re Corporation (reinsurance) and Mattel Inc. (toy manufacturer). In
addition, he serves as a Trustee of Corporate Property Investors, the EPS
Foundation at Trinity College, the Naples Philharmonic Center for the Arts,
and Rensselaer Polytechnic Institute, and he is a member of the Advisory
Boards of Butler Capital Corporation Funds and Warburg, Pincus Partnership
Funds.
MARVIN L. MANN, 55 Railroad Avenue, Greenwich, CT, Trustee (1993) is
Chairman of the Board, President, and Chief Executive Officer of Lexmark
International, Inc. (office machines, 1991). 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) and Infomart (marketing services, 1991), a Trammell Crow Co. In
addition, he serves as a Campaign Vice Chairman of the Tri-State United Way
(1993) and is a member of the University of Alabama President's Cabinet
(1990).
THOMAS R. WILLIAMS, 21st Floor, 191 Peachtree Street, N.E., Atlanta, GA,
Trustee, is President of The Wales Group, 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 BellSouth Corporation (telecommunications),
ConAgra, Inc. (agricultural products), Fisher Business Systems, Inc.
(computer software), Georgia Power Company (electric utility), Gerber Alley
& Associates, Inc. (computer software), National Life Insurance Company of
Vermont, American Software, Inc. (1989), and AppleSouth, Inc. (restaurants,
1992).
GARY L. FRENCH, Treasurer (1991). Prior to becoming Treasurer of the
Fidelity funds, Mr. French was Senior Vice President, Fund Accounting -
Fidelity Accounting & Custody Services Co. (1991); Vice President, Fund
Accounting - Fidelity Accounting & Custody Services Co. (1990); and Senior
Vice President, Chief Financial and Operations Officer - Huntington
Advisers, Inc. (1985-1990).
ARTHUR S. LORING, Secretary, is Senior Vice President and General Counsel
of FMR, Vice President-Legal of FMR Corp., and Vice President and Clerk of
FDC .
FRED L. HENNING, JR., Vice President (1994), is Vice President of
Fidelity's money market funds and Senior Vice President of FMR Texas, Inc.
THOMAS D. MAHER, Assistant Vice President (1990), is Assistant Vice
President of Fidelity's money market funds and Vice President and Associate
General Counsel of FMR Texas (1990). Prior to 1990, Mr. Maher was an
employee of FMR and Assistant Secretary of all the Fidelity funds
(1985-1989).
LELAND BARRON, Vice President (1989) is Vice President of U.S. Government
Money Market Portfolio and U.S. Treasury Money Market Portfolio and of
other funds advised by FMR and is an employee of FMR Texas.
BURNELL STEHMAN, Vice President (1994) is Vice President of Domestic Money
Market Portfolio and of other funds advised by FMR and is an employee of
FMR Texas.
Under a retirement program that became effective on November 1, 1989,
Trustees, upon reaching age 72, become eligible to participate in a defined
benefit retirement program under which they receive payments during their
lifetime from the Portfolios based on their basic trustee fees and length
of service. Currently, Messrs. William R. Spaulding, Bertram H.
Witham, and David L. Yunich participate in the program.
The Trustees and officers of the Trust as a group, own less than 1% of each
Portfolio's outstanding shares.
MANAGEMENT CONTRACTS
Each Portfolio employs FMR to furnish investment advisory and other
services. Under FMR's management contract with each Portfolio, FMR acts as
investment adviser and, subject to the supervision of the Board of
Trustees, directs the investments of each Portfolio in accordance with its
investment objective, policies and limitations. FMR also provides each
Portfolio with all necessary office facilities, equipment and personnel for
servicing the Portfolios' investments and maintaining their organization,
and compensates all officers of the Trust, all Trustees who are "interested
persons" of the Trust or of FMR, and all the personnel of the Trust
performing services relating to research, statistical and investment
activities. In addition, FMR or its affiliates, subject to the supervision
of the Board of Trustees, provides the management and administrative
services necessary for the operation of each Portfolio. These services
include providing facilities for maintaining each Portfolio's organization,
supervising relations with the custodians, transfer and pricing agents,
accountants, underwriters and other persons dealing with the Portfolios,
preparing all general shareholder communications and conducting shareholder
relations, maintaining the Trust's records and the registration of each
Portfolio's shares under federal and state securities laws, developing
management and shareholder services for each Portfolio and furnishing
reports, evaluations and analyses on a variety of subjects to the Trustees.
FMR pays all the expenses of the Trust as described herein. Specific
expenses payable by FMR include, without limitation, the fees and expenses
of registering and qualifying the Portfolios and their shares for
distribution under federal and state securities laws; expenses of
typesetting for printing prospectuses; custodian charges; auditing and
legal expenses; insurance expense; association membership dues; the expense
of reports to shareholders; shareholder meetings; and proxy solicitations.
FIIOC is transfer, dividend disbursing, and shareholder servicing agent for
the Portfolios. The costs of these services are borne by FMR pursuant to
its management contract with each Portfolio. Service calculates each
Portfolio's NAV and dividends, and maintains each Portfolio's general
accounting records. The costs of these services are also borne by FMR
pursuant to its management contract with each Portfolio.
FMR pays all other expenses of the Portfolios with the following
exceptions: the payment of fees and expenses of all Trustees of the Trust
who are not "interested persons" of the Trust or FMR; brokerage fees or
commissions (if any); interest on borrowings; taxes; and such extraordinary
non-recurring expenses as may arise, including costs of litigation to which
the Portfolios may be a party, and any obligation a Portfolio may have to
indemnify its officers and Trustees with respect to litigation.
For these services and the payment by FMR of the Trust's expenses, each
Portfolio pays a monthly management fee to FMR at the annual rate of .42%
of the average net assets of the Portfolio throughout the month pursuant to
a Management Contract approved by the shareholders on October 30, 1986. The
management fees paid to FMR are reduced by an amount equal to the fees and
expenses of those Trustees who are not "interested persons" of the Trust or
FMR. See the table below for the fees received by FMR:
Management Fees For the Fiscal Years Ended:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
8/31/94 8/31/93 8/31/92*
U.S. Treasury Portfolio $ 693,283 $ 761,083 $ 705,658
U.S. Government Portfolio $ 726,413 $ 1,247,037 $ 1,316,958
Domestic Money Market Portfolio $ 1,781,535 $ 2,893,862 $ 2,796,308
</TABLE>
* On July 16, 1992, the Trustees of the Trust approved a change in the
fiscal year end of the Trust to August 31.
SUB-ADVISER. FMR has entered into a sub-advisory agreement with FMR Texas
pursuant to which FMR Texas has primary responsibility for providing
portfolio investment management services to each Portfolio. Under the
sub-advisory agreement, FMR pays FMR Texas fees equal to 50% of the
management fee payable to FMR under its Management Contract with each
Portfolio. The fees paid to FMR Texas are not reduced by any voluntary or
mandatory expense reimbursements that may be in effect from time to time.
Sub-advisory Fees Paid by FMR
To FMR Texas For the Fiscal Years Ended:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
8/31/94 8/31/93 8/31/92
U.S. Treasury Portfolio $ 346,642 $ 380,542 $ 352,829
U.S. Government Portfolio $ 363,207 $ 623,519 $ 658,479
Domestic Money Market Portfolio $ 890,768 $ 1,446,931 $ 1,398,154
</TABLE>
* On July 16, 1992, the Trustees of the Trust approved a change in the
fiscal year end of the Trust to August 31.
The Portfolios have a Distribution Agreement with FDC , a
Massachusetts corporation organized on July 18, 1960. FDC is a
broker-dealer registered under the Securities and Exchange Act of 1934 and
is a member of the National Association of Securities Dealers, Inc. The
Distribution Agreement calls for FDC to use all reasonable efforts,
consistent with its other business, to secure purchasers for shares of the
Portfolios, which are continuously offered. Promotional and administrative
expenses in connection with the offer and sale of shares are paid by FMR.
DISTRIBUTION AND SERVICE PLAN
Each Portfolio has adopted a Distribution and Service Plan (the Plans)
pursuant to Rule 12b-1 under the 1940 Act (the Rule). The Rule provides in
substance that a mutual fund may not engage directly or indirectly in
financing any activity that is primarily intended to result in the sale of
shares of the fund except pursuant to a plan adopted by the fund under the
Rule. The Trust's Board of Trustees has adopted the Plans to allow each
Portfolio and FMR to incur certain expenses that might be considered to
constitute indirect payment by the Portfolio of distribution expenses.
Under each Plan, if the payment of management fees by a Portfolio to FMR is
deemed indirect financing by the Portfolio of the distribution of its
shares, such payment is authorized by the Plan.
Each Plan specifically recognizes that FMR, either directly or through
FDC , may use its management fee revenue, past profits, or other
resources, without limitation, to pay promotional and administrative
expenses in connection with the offer and sale of shares of a Portfolio. In
addition, each Plan provides that FMR may use its resources, including its
management fee revenues, to make payments to third parties that provide
assistance in selling shares of the Portfolio, or to third parties,
including banks, that render shareholder support services. The Board of
Trustees has authorized such payments.
As required by the Rule, the Trustees carefully considered all pertinent
factors relating to the implementation of each Plan prior to its approval,
and have determined that there is a reasonable likelihood that the Plan
will benefit the Portfolio and its shareholders. In particular, the
Trustees noted that none of the Plans authorizes payments by the Portfolios
other than those made to FMR under its management contract with such
Portfolio. To the extent that each Plan gives FMR and FDC greater
flexibility in connection with the distribution of shares of the applicable
Portfolio, additional sales of each Portfolio's shares may result.
Additionally, certain shareholder support services may be provided more
effectively under each Plan by local entities with whom shareholders have
other relationships. Each Plan was approved by Fidelity Money Market Trust
on December 8 , 1994, by the shareholder s of each Portfolio,
pursuant to an Agreement and Plan of Conversion also approved by
shareholders of the Portfolios on December 8 , 1994.
The Glass-Steagall Act generally prohibits federally and state chartered or
supervised banks from engaging in the business of underwriting, selling or
distributing securities. Although the scope of this prohibition under the
Glass-Steagall Act has not been clearly defined by the courts or
appropriate regulatory agencies, FDC believes that the Glass
Steagall Act should not preclude a bank from performing shareholder support
services, or servicing and recordkeeping functions. FDC intends to
engage banks only to perform such functions. However, changes in federal or
state statutes and regulations pertaining to the permissible activities of
banks and their affiliates or subsidiaries, as well as further judicial or
administrative decisions or interpretations, could prevent a bank from
continuing to perform all or a part of the contemplated services. If a bank
were prohibited from so acting, the Trustees would consider what actions,
if any, would be necessary to continue to provide efficient and effective
shareholder services. In such event, changes in the operation of the
Portfolios might occur, including possible termination of any automatic
investment or redemption or other services then provided by the bank. It is
not expected that shareholders would suffer any adverse financial
consequences as a result of any of these occurrences. In addition, state
securities laws on this issue may differ from the interpretations of
federal law expressed herein, and banks and financial institutions may be
required to register as dealers pursuant to state law.
Each Portfolio may execute portfolio transactions with and purchase
securities issued by depository institutions that receive payments under
its Plan. No preference for the instruments of such depository institutions
will be shown in the selection of investments.
DESCRIPTION OF THE TRUST
TRUST ORGANIZATION. U.S. Treasury Portfolio, U.S. Government
Portfolio and Domestic Money Market Portfolio are portfolios of Fidelity
Money Market Trust, an open-end management investment company originally
organized as a Massachusetts business trust on August 21, 1978 and
amended and restated November 1, 1989. On December 29, 1994 the
Trust was converted to a Delaware business trust pursuant to an agreement
approved by shareholders on December 8 , 1994. The Delaware trust,
which was organized on June 20, 1991, under the name of Fidelity Money
Market Trust I I, succeeded to the name Fidelity Money Market Trust
on December 29 , 1994. Currently, there are five portfolios of the
Trust: U.S. Treasury Portfolio, U.S. Government Portfolio, Domestic Money
Market Portfolio, Retirement Money Market Portfolio, and Retirement
Government Money Market Portfolio.
The Trust Instrument permits the Trustees to create additional
Portfolios .
In the event that FMR ceases to be the investment adviser to a
Portfolio, the right of the Trust or Portfolio to use the identifying name
"Fidelity" may be withdrawn. There is a remote possibility that one
Portfolio might become liable for any misstatement in its prospectus or
statement of additional information about another Portfolio.
The assets of the Trust, received for the issue or sale of shares of each
portfolio and all income, earnings, profits, and proceeds thereof, subject
only to the rights of creditors, are especially allocated to such
portfolio, and constitute the underlying assets of such portfolio. The
underlying assets of each portfolio are segregated on the books of account,
and are to be charged with the liabilities with respect to such portfolio
and with a share of the general expenses of the Trust. Expenses with
respect to the Trust are to be allocated in proportion to the asset value
of the respective portfolios, except where allocations of direct expense
can otherwise be fairly made. The officers of the Trust, subject to the
general supervision of the Board of Trustees, have the power to determine
which expenses are allocable to a given portfolio, or which are general or
allocable to all of the portfolios. In the event of the dissolution or
liquidation of the Trust, shareholders of each portfolio are entitled to
receive as a class the underlying assets of such portfolio available for
distribution.
SHAREHOLDER AND TRUSTEE LIABILITY. The Trust is a business trust organized
under Delaware law. Delaware law provides that shareholders shall be
entitled to the same limitations of personal liability extended to
stockholders of private corporations for profit. The courts of some states,
however, may decline to apply Delaware law on this point. The Trust
Instrument contains an express disclaimer of shareholder liability for the
debts, liabilities, obligations, and expenses of the Trust and requires
that a disclaimer be given in each contract entered into or executed by the
Trust or the Trustees. The Trust Instrument provides for indemnification
out of each portfolio's property of any shareholder or former shareholder
held personally liable for the obligations of the portfolio. The Trust
Instrument also provides that each portfolio shall, upon request, assume
the defense of any claim made against any shareholder for any act or
obligation of the portfolio and satisfy any judgment thereon. Thus, the
risk of a shareholder incurring financial loss on account of shareholder
liability is limited to circumstances in which Delaware law does not apply,
no contractual limitation of liability was in effect, and a portfolio is
unable to meet its obligations. FMR believes that, in view of the above,
the risk of personal liability to shareholders is remote.
The Trust Instrument further provides that the Trustees, if they have
exercised reasonable care, will not be liable to any person other than the
Trust or its shareholders; moreover, the Trustees shall not be liable for
any conduct whatsoever provided that the Trustees are not protected against
any liability to which they would otherwise would be subject by reason of
willful misfeasance, bad faith, gross negligence, or reckless disregard of
the duties involved in the conduct of their office.
VOTING RIGHTS. Each portfolio's capital consists of shares of beneficial
interest. As a shareholder, you receive one vote for each dollar of net
asset value you own. The shares have no preemptive or conversion rights;
the voting and dividend rights, the right of redemption, and the privilege
of exchange are described in the Prospectus. Shares are fully paid and
nonassessable, except as set forth under the heading "Shareholder and
Trustee Liability" above. Shareholders representing 10% or more of the
Trust or a portfolio may, as set forth in the Trust Instrument, call
meetings of the Trust or a portfolio for any purpose related to the Trust
or portfolio, as the case may be, including, in the case of a meeting of
the entire Trust, the purpose of voting on removal of one or more Trustees.
The Trust or any portfolio may be terminated upon the sale of its assets
to, or merger with, another open-end management investment company, or upon
liquidation and distribution of its assets. Generally such terminations
must be approved by vote of the holders of a majority of the Trust or the
portfolio, as determined by the current value of each shareholder's
investment in the portfolio or Trust; however, the Trustees may, without
prior shareholder approval, change the form of organization of the Trust by
merger, consolidation, or incorporation. If not so terminated or
reorganized, the Trust and each portfolio will continue indefinitely.
Under the Trust Instrument, the Trustees may, without shareholder vote,
cause the Trust to merge or consolidate into one or more Trusts,
partnerships, or corporations, or cause the Trust to be incorporated under
Delaware law, so long as the surviving entity is an open-end management
investment company that will succeed to or assume the Trust's registration
statement. Each Portfolio may invest all of its assets in another
investment company.
As of October 30 , 1994 the following owned of record or beneficially
5% or more of outstanding shares :
For U.S. Treasury Portfolio: Independent Research Agency, 10.45%; First
National Bank of Joilet, 10.27%; South Holland Bancorp., 9.78%; Marine
Midland Bank, 6.82%; Owensboro National Bank, 6.74%; The Bank of
California, N.A., 5.58%; and Bank of the West, 5.30%.
For U.S. Government Portfolio: The Bank of California, N.A. 22.44%; Fred
Alger Management, Inc., 15.06%; Cambridge Trust Company, 10.27%; National
Presto Industries, Inc. 8.72%; Resources Trust Company, 6.02%; Battle Creek
City, 5.46%; and United States Trust Company of NY, 5.32%.
For Domestic Money Market Portfolio: Bank of America 14.44%; Promus
Companies 12.59%; Boston Consulting Group, Inc., 7.78%; Eastern Utilities
Associates, 7.62%; American National Bank & Trust Co., 5.07%.
CUSTODIAN. Morgan Guaranty Trust Company of New York, 60 Wall Street, New
York, NY, is custodian of the assets of the Portfolios. The custodian is
responsible for the safekeeping of the Portfolios' assets and the
appointment of subcustodian banks and clearing agencies. The custodian
takes no part in determining the investment policies of the Portfolios or
in deciding which securities are purchased or sold by the Portfolios. The
Portfolios may, however, invest in obligations of the custodian and may
purchase securities from or sell securities to the custodian.
FMR, its officers and directors, its affiliated companies, and the Trust's
Trustees may from time to time have transactions with various banks,
including banks serving as custodians for certain of the funds advised by
FMR. Transactions that have occurred to date include 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 Trust relationships.
AUDITOR. Coopers & Lybrand L.L.P. serves as the Trust's
independent accountant. The auditor examines financial statements for the
Portfolios and provides other audit, tax and related services.
FINANCIAL STATEMENTS
Each Portfolio's financial statements and financial highlights for the
fiscal year ended August 31, 1994 are included in the Portfolios' Annual
Report, which is a separate report attached to the Prospectus. Each
Portfolio's financial statements and financial highlights are incorporated
herein by reference.
APPENDIX
The descriptions that follow are examples of eligible ratings for the
Portfolios. The Portfolios may, however, consider the ratings for other
types of investments and the ratings assigned by other rating organizations
when determining the eligibility of a particular investment.
DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC.'S COMMERCIAL PAPER RATINGS:
Issues rated PRIME-1 (or related supporting institutions) have a superior
capacity for repayment of short-term promissory obligations. Prime-1
repayment capacity will normally be evidenced by the following
characteristics:
(medium solid bullet) Leading market positions in well established
industries.
(medium solid bullet) High rates of return on funds employed.
(medium solid bullet) Conservative capitalization structures with moderate
reliance on debt and ample asset protection.
(medium solid bullet) Broad margins in earnings coverage of fixed financial
charges with high internal cash generation.
(medium solid bullet) Well-established access to a range of financial
markets and assured sources of alternate liquidity.
Issues rated PRIME-2 (or related supporting institutions) have a strong
capacity for repayment of short-term promissory obligations. This will
normally be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be
more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
DESCRIPTION OF STANDARD & POOR'S CORPORATION'S COMMERCIAL PAPER RATINGS:
A - Issues assigned this highest rating are regarded as having the greatest
capacity for timely payment. Issues in this category are delineated with
the numbers 1 and 2 to indicate the relative degree of safety.
A-1 - This designation indicates that the degree of safety regarding timely
payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics will be denoted with a plus (+)
sign designation.
A-2 - Capacity for timely payment on issues with this designation is
strong. However, the relative degree of safety is not as high as for issues
designated A-1.
DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC.'S CORPORATE BOND RATINGS:
AAA - Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to
as "gilt edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such
issuers.
AA - Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally
known as high grade bonds. They are rated lower than the best bonds because
margins of protection may not be as large as in Aaa securities or
fluctuation of protective elements may be of greater amplitude or there may
be other elements present which make the long term risks appear somewhat
larger than in Aaa securities.
DESCRIPTION OF STANDARD & POOR'S CORPORATION'S CORPORATE BOND RATINGS:
AAA - Debt rated AAA has the highest rating assigned by Standard & Poor's
to a debt obligation. Capacity to pay interest and repay principal is
extremely strong.
AA - Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the highest rated debt issues only in small
degree.
FIDELITY MONEY MARKET TRUST
ANNUAL REPORT
AUGUST 31, 1994
FIDELITY MONEY MARKET TRUST: U.S. TREASURY PORTFOLIO
INVESTMENTS/AUGUST 31,1994
(Showing Percentage of Total Value of Investments)
ANNUALIZED
YIELD AT
DUE TIME OF PRINCIPAL VALUE MATURITY VALUE
DATE PURCHASE AMOUNT (NOTE 1) AMOUNT (NOTE 1)
U.S. Treasury Obligations - 32.4%
U.S. TREASURY BILLS - 31.6%
9/29/94 3.93% $ 14,000,000 $ 13,958,086 993134VJ
10/13/94 4.04 5,000,000 4,976,900 993134VR
10/20/94 3.36 5,000,000 4,977,678 993134GV
12/15/94 4.60 9,000,000 8,882,006 9931344N
1/5/95 4.87 5,000,000 4,916,875 9931345H
1/19/95 4.96 5,000,000 4,905,889 9931345U
1/26/95 4.96 4,000,000 3,920,947 9931346E
2/16/95 5.12 4,000,000 3,906,853 9931347H
3/2/95 5.06 9,000,000 8,775,720 9931348E
59,220,954
U.S. TREASURY NOTES - 0.8%
1/31/95 3.63 1,500,000 1,503,433 993993DM
TOTAL U.S. TREASURY OBLIGATIONS 60,724,387
MATURITY
AMOUNT
Repurchase Agreements - 67.6%
With BT Securities Corp.:
At 4.80%, dated 8/31/94 due 9/1/94:
U.S. Treasury Obligations
(principal amount $9,020,000)
4.375%, 11/15/96 $ 8,501,133 8,500,000 05599D5G
With Barclays De Zoete Wedd GSI:
At 4.85%, dated 8/31/94 due 9/1/94:
U.S. Treasury Obligations
(principal amount $7,480,000)
9.25%, 8/15/98 8,001,078 8,000,000 06799JUC
With Daiwa Securities Co. Ltd.:
At 4.82%, dated 8/31/94 due 9/1/94:
U.S. Treasury Obligations
(principal amount $8,390,000)
7%, 4/15/99 8,501,138 8,500,000 519999FP
With Donaldson, Lufkin & Jenrette Securities Corp.:
At 4.85%, dated 8/31/94 due 9/1/94:
U.S. Treasury Obligations
(principal amount $7,640,000)
8.75%, 2/15/19 8,501,145 8,500,000 25899GAL
With First Boston Corporation:
At 4.80%, dated 8/31/94 due 9/1/94:
U.S. Treasury Obligations
(principal amount $41,040,000)
8.75%, 10/15/97 $ 44,005,867 $ 44,000,000 31699MBX
With J.P. Morgan Securities, Inc.:
At 4.83%, dated 8/31/94 due 9/1/94:
U.S. Treasury Obligations
(principal amount $12,762,000)
12.75%, 11/15/10 18,002,415 18,000,000 61699BGR
With Swiss Bank Corporation
Government Securities, Inc.:
At 4.85%, dated 8/31/94 due 9/1/94:
U.S. Treasury Obligations
(principal amount $7,950,000)
8.75%, 8/15/00 8,501,145 8,500,000 82599SGC
In a joint trading account
(U.S. Treasury Obligations)
dated 8/31/94, due 9/1/94
(Note 2)
At 4.85% 22,860,079 22,857,000 99799NWT
TOTAL REPURCHASE AGREEMENTS 126,857,000
TOTAL INVESTMENTS - 100% $ 187,581,387
Total Cost for Income Tax Purposes - $187,581,387
INCOME TAX INFORMATION:
At August 31, 1994, the fund had a capital loss carryforward of
approximately $74,000 of which $53,000, $1,000 and $20,000 will expire on
August 31, 1996, 2001 and 2002, respectively.
U.S. TREASURY PORTFOLIO
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
August 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $126,857,000) - See accompanying $ 187,581,387
schedule
Interest receivable 22,544
TOTAL ASSETS 187,603,931
LIABILITIES
Payable to custodian bank $ 321
Payable for investments 8,775,720
purchased
Dividends payable 169,067
Accrued management fee 63,176
TOTAL LIABILITIES 9,008,284
NET ASSETS $ 178,595,647
Net Assets consist of:
Paid in capital $ 178,633,520
Accumulated net realized gain (loss) on investments (37,873)
NET ASSETS, for 178,633,520 shares outstanding $ 178,595,647
NET ASSET VALUE, offering price and redemption price per share ($178,595,647 (divided by) 178,633,520 shares) $1.00
</TABLE>
Statement of Operations
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended August 31, 1994
INTEREST INCOME $ 5,901,071
EXPENSES
Management fee $ 693,283
Non-interested trustees' compensation 1,022
TOTAL EXPENSES 694,305
NET INTEREST INCOME 5,206,766
NET REALIZED GAIN (LOSS) ON (19,591)
INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 5,187,175
</TABLE>
Statement of Changes in Net Assets
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED AUGUST 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 5,206,766 $ 5,187,658
Net interest income
Net realized gain (loss) (19,591) (1,377)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 5,187,175 5,186,281
Dividends to shareholders from net interest income (5,206,766) (5,187,658)
Share transactions at net asset value of $1.00 per share 901,345,282 891,841,648
Proceeds from sales of shares
Reinvestment of dividends from net interest income 3,627,764 3,566,725
Cost of shares redeemed (911,811,257) (901,937,708)
Net increase (decrease) in net assets and shares
resulting from share transactions (6,838,211) (6,529,335)
TOTAL INCREASE (DECREASE) IN NET ASSETS (6,857,802) (6,530,712)
NET ASSETS
Beginning of period 185,453,449 191,984,161
End of period $ 178,595,647 $ 185,453,449
</TABLE>
FINANCIAL HIGHLIGHTS
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED AUGUST 31, TEN MONTHS YEARS ENDED OCTOBER 31,
ENDED
AUGUST 31,
1994 1993 1992 1991 1990
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations .032 .029 .033 .061 .079
Net interest income
Less Distributions (.032) (.029) (.033) (.061) (.079)
From net interest income
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 3.21% 2.89% 3.37% 6.24% 8.19%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000
omitted) $ 178,596 $ 185,453 $ 191,984 $ 215,610 $ 253,705
Ratio of expenses to average net
assets .42% .42% .42%A .42% .42%
Ratio of net interest income to
average net assets 3.15% 2.86% 4.00%A 6.12% 7.91%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
FIDELITY MONEY MARKET TRUST: U.S. GOVERNMENT PORTFOLIO
INVESTMENTS/AUGUST 31, 1994
(Showing Percentage of Total Value of Investments)
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Federal Agencies - 56.2%
EXPORT IMPORT BANK, U.S. - AGENCY COUPONS - 1.1%
9/15/94 4.81% (a) $ 1,881,882 $ 1,881,882 530993AA
FEDERAL FARM CREDIT BANK - AGENCY COUPONS - 2.9%
9/1/94 4.53 1,000,000 1,000,000 313993QQ
10/3/94 3.36 2,000,000 2,000,041 313993JQ
10/3/94 4.13 2,000,000 1,999,780 313993NX
4,999,821
FEDERAL FARM CREDIT BANK - DISCOUNT NOTES - 0.7%
9/6/94 3.98 1,250,000 1,249,323 313993NR
FEDERAL HOME LOAN BANK - AGENCY COUPONS - 1.1%
9/1/94 5.33 (a) 2,000,000 1,996,812 313389U9
FEDERAL HOME LOAN MORTGAGE CORP. - DISCOUNT NOTES - 5.0%
10/21/94 4.48 4,000,000 3,975,667 355993SN
10/25/94 4.60 1,275,000 1,266,317 355993UK
11/28/94 4.18 3,500,000 3,465,350 355993RM
8,707,334
FEDERAL NATIONAL MORTGAGE ASSOC. - AGENCY COUPONS - 3.4%
9/1/94 5.35 (a) 6,000,000 6,000,000 9931287F
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 39.1%
9/7/94 4.48 1,000,000 999,772 9950095L
9/7/94 4.50 7,000,000 6,994,797 995009XX
9/29/94 4.04 5,000,000 4,984,639 9931304U
10/4/94 4.27 5,000,000 4,980,842 995009AN
10/6/94 4.19 4,000,000 3,984,017 995009ER
10/19/94 4.05 4,450,000 4,426,563 993130VX
10/21/94 4.59 2,000,000 1,987,389 9950094Q
10/25/94 3.40 4,500,000 4,477,658 9931286J
11/29/94 4.87 5,000,000 4,941,285 995009QE
12/1/94 4.85 6,000,000 5,928,262 995009TF
12/29/94 4.99 7,000,000 6,887,082 9950093K
1/3/95 5.04 5,000,000 4,915,267 995009YD
1/6/95 5.05 5,000,000 4,913,217 995009YB
1/17/95 5.03 1,000,000 981,217 9950094H
1/18/95 5.03 2,000,000 1,962,161 9950094C
3/1/95 5.12 3,000,000 2,924,733 9950099P
3/6/95 5.10 2,000,000 1,948,642 9950099W
68,237,543
STUDENT LOAN MARKETING ASSOC. - AGENCY COUPONS - 2.9%
9/6/94 5.05 (a) 5,000,000 5,000,000 863990PS
TOTAL FEDERAL AGENCIES 98,072,715
U.S. Treasury Obligations - 1.7%
U.S. TREASURY BILLS
10/20/94 3.36% $ 3,000,000 $ 2,986,607 993134GV
MATURITY
AMOUNT
Repurchase Agreements - 42.1%
With Goldman, Sachs & Co.:
At 4.70%, dated 8/24/94 due 9/7/94:
U.S. Government Obligations
(principal amount $10,300,000)
4% to 8%,
7/1/01 to 9/1/23 $ 10,018,278 10,000,000 38199MHV
With Nomura Securities Intl. Inc.:
At 4.75%, dated 8/23/94 due 9/6/94:
U.S. Government Obligations
(principal amount $6,016,012)
9%, 10/15/27 6,011,083 6,000,000 69699BYM
In a joint trading account
dated 8/31/94, due 9/1/94
(Notes 2 and 3)
(U.S. Treasury Obligations)
At 4.86% 25,515,445 25,512,000 99799NWU
(U.S. Government Obligations)
At 4.89% 32,004,349 32,000,000 99799NWR
TOTAL REPURCHASE AGREEMENTS 73,512,000
TOTAL COST OF INVESTMENTS - 100% $ 174,571,322
Total Cost of Investments for Income Tax Purposes - $174,571,322
LEGEND:
(f) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due date on these types of
securities reflects the next interest rate reset date or when applicable,
the final maturity date.
INCOME TAX INFORMATION:
At August 31, 1994, the fund had a capital loss carryforward of
approximately $60,600 of which $19,400, $200, $13,000 and $28,000 will
expire on August 31, 1996, 1997, 2001 and 2002, respectively.
U.S. GOVERNMENT PORTFOLIO
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
August 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $73,512,000) - See accompanying $ 174,571,322
schedule
Interest receivable 206,179
TOTAL ASSETS 174,777,501
LIABILITIES
Payable for investments $ 1,948,643
purchased
Share transactions in process 228,221
Dividends payable 164,180
Accrued management fee 58,482
TOTAL LIABILITIES 2,399,526
NET ASSETS $ 172,377,975
Net Assets consist of:
Paid in capital $ 172,342,035
Accumulated net realized gain (loss) on investments 35,940
NET ASSETS, for 172,342,035 shares outstanding $ 172,377,975
NET ASSET VALUE, offering price and redemption price per share ($172,377,975 (divided by) 172,342,035 shares) $1.00
</TABLE>
Statement of Operations
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended August 31, 1994
INTEREST INCOME $ 6,321,764
EXPENSES
Management fee $ 726,413
Non-interested trustees' compensation 1,092
TOTAL EXPENSES 727,505
NET INTEREST INCOME 5,594,259
NET REALIZED GAIN (LOSS) ON (27,868)
INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 5,566,391
</TABLE>
Statement of Changes in Net Assets
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED AUGUST 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 5,594,259 $ 8,688,945
Net interest income
Net realized gain (loss) (27,868) (12,575)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 5,566,391 8,676,370
Dividends to shareholders from net interest income (5,594,259) (8,688,945)
Share transactions at net asset value of $1.00 per share 754,973,945 1,043,375,925
Proceeds from sales of shares
Reinvestment of dividends from net interest income 3,543,173 5,660,644
Cost of shares redeemed (792,649,688) (1,199,183,702)
Net increase (decrease) in net assets and shares resulting
from share transactions (34,132,570) (150,147,133)
TOTAL INCREASE (DECREASE) IN NET ASSETS (34,160,438) (150,159,708)
NET ASSETS
Beginning of period 206,538,413 356,698,121
End of period $ 172,377,975 $ 206,538,413
</TABLE>
FINANCIAL HIGHLIGHTS
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED AUGUST 31, TEN MONTHS YEARS ENDED OCTOBER 31,
ENDED
AUGUST 31,
1994 1993 1992 1991 1990
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations .032 .029 .035 .062 .079
Net interest income
Less Distributions (.032) (.029) (.035) (.062) (.079)
From net interest income
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 3.29% 2.95% 3.53% 6.41% 8.20%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted)$ 172,378 $ 206,538 $ 356,698 $ 400,699 $ 473,450
Ratio of expenses to average net assets.42% .42% .42%A .42% .42%
Ratio of net interest income to average
net assets 3.23% 2.92% 4.18%A 6.27% 7.91%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
FIDELITY MONEY MARKET TRUST: DOMESTIC MONEY MARKET PORTFOLIO
INVESTMENTS/AUGUST 31, 1994
(Showing Percentage of Total Value of Investments)
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Bankers' Acceptances - 3.7%
Chase Manhattan Bank
10/25/94 4.82% $ 3,614,828 $ 3,588,909 161999LE
CoreStates Bank of Delaware, N.A.
9/22/94 4.61 2,500,000 2,493,379 2186989D
Mellon Bank, N.A.
9/6/94 4.73 5,000,000 4,996,736 5859916G
11/1/94 4.90 2,000,000 1,983,564 5859916H
Republic New York Corp.
9/30/94 4.46 2,000,000 1,992,911 7607199L
TOTAL BANKERS' ACCEPTANCES 15,055,499
Certificates of Deposit - 4.9%
NBD Bank, N.A.
9/16/94 4.75 10,000,000 9,999,450 634990AM
9/22/94 4.63 5,000,000 5,000,173 634990AS
Old Kent Bank & Trust Co.
10/5/94 4.83 5,000,000 5,000,000 679999DK
TOTAL CERTIFICATES OF DEPOSIT 19,999,623
Commercial Paper - 44.2%
AT&T Capital Corp.
9/29/94 4.75 5,000,000 4,981,722 03018B9L
Associates Corp. of North America
9/23/94 4.53 5,000,000 4,986,250 045992XB
10/31/94 4.84 10,000,000 9,920,000 045992XP
Banc One Diversified Services Corp.
9/7/94 4.68 1,250,000 1,249,031 05999NFA
Commercial Credit Co.
9/7/94 4.45 5,000,000 4,996,333 2019906R
Corporate Asset Funding Co., Inc.
9/8/94 4.66 10,000,000 9,991,007 1769925L
11/17/94 4.96 9,000,000 8,905,675 1769926A
Dayton Hudson Corp.
9/16/94 4.76 6,500,000 6,487,135 239992JK
Electronic Data Systems Corp.
9/14/94 4.77 4,000,000 3,993,139 285998FX
Exxon Asset Management Co.
9/19/94 4.53 10,000,000 9,977,500 3019279V
Exxon Credit Corp.
10/14/94 4.80 10,000,000 9,943,025 3019049R
Ford Motor Credit Corp.
9/7/94 4.42 7,000,000 6,994,867 34599BUD
GTE Corp.
9/2/94 4.80 1,960,000 1,959,739 362991FN
General Electric Capital Corp.
10/12/94 4.76% $ 5,000,000 $ 4,973,236 369998PV
General Motors Acceptance Corp.
10/24/94 4.89 5,000,000 4,964,299 638998UN
10/27/94 4.81 5,000,000 4,963,056 638998UG
Goldman Sachs Group, L.P. (The)
9/6/94 4.71 5,000,000 4,996,757 696992LS
ITT Corp.
9/16/94 4.58 5,000,000 4,990,521 450991GQ
ITT Hartford Group, Inc.
9/2/94 4.42 8,500,000 8,498,961 45099MAB
10/4/94 4.83 5,000,000 4,978,000 45099MAD
Merrill Lynch & Co., Inc.
10/17/94 4.82 5,000,000 4,969,333 59099GDA
11/18/94 4.91 4,400,000 4,353,763 59099GCV
MetLife Funding, Inc.
11/14/94 4.81 7,620,000 7,545,599 592990CD
NationsBank Corp.
11/16/94 4.90 10,000,000 9,897,822 6385859E
11/22/94 4.91 5,000,000 4,944,764 6385859G
PHH Corp.
9/8/94 4.50 5,000,000 4,995,644 6999903D
Sears Roebuck Acceptance Corp.
10/18/94 4.92 4,000,000 3,974,516 81299EEH
Smith Barney, Inc.
10/17/94 4.88 5,000,000 4,969,078 83199HAL
Texaco, Inc.
11/15/94 4.94 9,000,000 8,908,594 920998PB
Textron, Inc.
9/1/94 4.59 1,000,000 1,000,000 88599CAV
Transamerica Finance Corp.
9/13/94 4.71 500,000 499,217 893991DP
TOTAL COMMERCIAL PAPER 178,808,583
Federal Agencies - 10.6%
FEDERAL FARM CREDIT BANK - DISCOUNT NOTES - 1.2%
11/14/94 4.81 5,000,000 4,951,181 313993QW
FEDERAL HOME LOAN MORTGAGE CORP. - DISCOUNT NOTES - 4.2%
9/14/94 4.50 5,000,000 4,991,911 355993UW
9/26/94 4.46 1,947,000 1,941,010 355993UP
9/28/94 4.46 2,250,000 2,242,524 355993UQ
1/19/95 5.06 8,000,000 7,846,000 355993VE
17,021,445
ANNUALIZED ANNUALIZED
YIELD AT YIELD AT
DUE TIME OF PRINCIPAL VALUE DUE TIME OF PRINCIPAL VALUE
DATE PURCHASE AMOUNT (NOTE 1) DATE PURCHASE AMOUNT (NOTE 1)
Federal Agencies - CONTINUED
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 2.7%
9/23/94 4.52% $ 235,000 $ 234,361 995009PY
9/29/94 4.52 265,000 264,083 995009QA
9/30/94 4.52 145,000 144,480 995009QB
10/3/94 4.58 500,000 498,000 995009QD
10/13/94 4.58 1,530,000 1,521,968 995009QC
1/4/95 5.04 5,000,000 4,914,583 9950094B
2/6/95 5.01 3,490,000 3,414,946 9950099T
10,992,421
STUDENT LOAN MARKETING ASSOC. - AGENCY COUPONS - 2.5%
9/6/94 4.92 (a) 10,000,000 10,000,000 863990PS
TOTAL FEDERAL AGENCIES 42,965,047
Bank Notes - 8.2%
Bank One - Milwaukee
9/1/94 4.49 (a) 5,000,000 4,997,493 065996AN
Bank of New York (Delaware)
9/6/94 4.57 (a) 10,000,000 10,000,000 06499AAJ
First National Bank of Boston
9/27/94 4.60 5,000,000 5,000,000 3235859W
10/18/94 4.90 5,000,000 4,999,871 322993AD
Fleet Bank of Massachusetts
9/6/94 4.75 3,000,000 2,999,992 3389149A
PNC Bank, N.A.
9/7/94 4.90 (a) 5,000,000 4,993,150 69399EAM
TOTAL BANK NOTES 32,990,506
Master Notes (a) - 5.9%
J.P. Morgan Securities
9/1/94 5.11 9,000,000 9,000,000 6169988F
Morgan Stanley Group, Inc. (c)
9/1/94 5.08 5,000,000 5,000,000 61799EJQ
Norwest Corp.
9/1/94 4.82 10,000,000 10,000,000 66899CCD
TOTAL MASTER NOTES 24,000,000
Medium-Term Notes (a) - 3.5%
General Motors Acceptance Corp.
11/7/94 4.86 4,000,000 4,000,000 638998SX
Goldman Sachs Group, L.P. (The) (b)
9/1/94 4.48 5,000,000 5,000,000 696992KB
PepsiCo.
9/1/94 4.97 5,000,000 5,000,000 713991EC
TOTAL MEDIUM-TERM NOTES 14,000,000
Short-Term Notes (a) - 6.7%
CSA Funding - A (c)
9/8/94 4.94% $ 6,000,000 $ 6,000,000 129993AC
Capital One Funding Corp.
9/8/94 4.85 5,000,000 5,000,000 14040G9B
SMM Trust Company (1994-A) (c)
9/18/94 4.57 11,000,000 10,999,490 83199GAD
SMM Trust Company (1994-E) (c)
10/13/94 4.64 5,000,000 4,999,495 83199GAF
TOTAL SHORT-TERM NOTES 26,998,985
MATURITY
AMOUNT
Repurchase Agreements - 12.3%
With Goldman, Sachs & Co.:
At 4.75%, dated 8/30/94 due 9/20/94:
U.S. Government Obligations
(principal amount $10,300,001)
8%, 7/1/01 $ 10,027,708 10,000,000 38199MKQ
In a joint trading account
(U.S. Treasury Obligations)
dated 8/31/94, due 9/1/94
(Note 2)
At 4.86% 39,548,339 39,543,000 99799NWU
TOTAL REPURCHASE AGREEMENTS 49,543,000
TOTAL INVESTMENTS - 100% $ 404,361,243
Total Cost for Income Tax Purposes - $404,361,243
LEGEND:
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end. The due date on these types of
securities reflects the next interest rate reset date or when applicable,
the final maturity date.
(b) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At the period
end, the value of these securities amounted to $5,000,000 or 1.3% of net
assets.
(c) Restricted securities - Investment in securities not registered under
the Securities Act of 1933 (see Note 2 of Notes to Financial Statements).
Additional information on each holding is as follows:
ACQUISITION ACQUISITION
SECURITY DATE COST
CSA Funding - A 10/28/93 $ 6,000,000
Morgan Stanley Group, Inc. 2/1/94 $ 5,000,000
SMM Trust Company:
(1994-A) 3/18/94 $ 11,000,000
(1994-E) 4/18/94 $ 5,000,000
INCOME TAX INFORMATION:
At August 31, 1994, the fund had a capital loss carryforward of
approximately $117,000 of which $43,000, $40,000, $32,000 and $2,000 will
expire on August 31, 1995, 1996, 1997 and 1998, respectively.
DOMESTIC MONEY MARKET PORTFOLIO
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
August 31, 1994
ASSETS
Investment in securities, at value (including repurchase agreements of $49,543,000) - See accompanying $ 404,361,243
schedule
Interest receivable 749,929
TOTAL ASSETS 405,111,172
LIABILITIES
Payable for investments $ 4,969,333
purchased
Share transactions in process 223,360
Dividends payable 442,036
Accrued management fee 143,650
TOTAL LIABILITIES 5,778,379
NET ASSETS $ 399,332,793
Net Assets consist of:
Paid in capital $ 399,403,765
Accumulated net realized gain (loss) on investments (70,972)
NET ASSETS, for 399,403,765 shares outstanding $ 399,332,793
NET ASSET VALUE, offering price and redemption price per share ($399,332,793 (divided by) 399,403,765 shares) $1.00
</TABLE>
Statement of Operations
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
Year Ended August 31, 1994
INTEREST INCOME $ 15,548,661
EXPENSES
Management fee $ 1,781,535
Non-interested trustees compensation 2,790
TOTAL EXPENSES 1,784,325
NET INTEREST INCOME 13,764,336
NET REALIZED GAIN (LOSS) ON 2,518
INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 13,766,854
</TABLE>
Statement of Changes in Net Assets
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED AUGUST 31,
1994 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 13,764,336 $ 19,965,907
Net interest income
Net realized gain (loss) 2,518 1,625
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 13,766,854 19,967,532
Dividends to shareholders from net interest income (13,764,336) (19,965,907)
Share transactions at net asset value of $1.00 per share 3,064,984,625 4,090,854,898
Proceeds from sales of shares
Reinvestment of dividends from net interest income 8,647,981 9,923,630
Cost of shares redeemed (3,285,712,520) (4,255,090,661)
Net increase (decrease) in net assets and shares resulting
from share transactions (212,079,914) (154,312,133)
TOTAL INCREASE (DECREASE) IN NET ASSETS (212,077,396) (154,310,508)
NET ASSETS
Beginning of period 611,410,189 765,720,697
End of period $ 399,332,793 $ 611,410,189
</TABLE>
FINANCIAL HIGHLIGHTS
DRAFT
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED AUGUST 31, TEN MONTHS YEARS ENDED OCTOBER 31,
ENDED
AUGUST 31,
1994 1993 1992 1991 1990
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
Income from Investment Operations .033 .029 .034 .063 .080
Net interest income
Less Distributions (.033) (.029) (.034) (.063) (.080)
From net interest income
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 3.34% 2.93% 3.44% 6.44% 8.27%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000
omitted) $ 399,333 $ 611,410 $ 765,721 $ 851,872 $ 944,782
Ratio of expenses to average net
assets .42% .42% .42%A .42% .42%
Ratio of net interest income to
average net assets 3.24% 2.89% 4.04%A 6.38% 8.01%
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 1994
1. SIGNIFICANT ACCOUNTING POLICIES.
U.S. Treasury Portfolio, U.S. Government Portfolio and Domestic Money
Market Portfolio (the funds) are funds of Fidelity Money Market Trust (the
trust). The trust is registered under the Investment Company Act of 1940,
as amended (the 1940 Act), as an open-end management investment company
organized as a Massachusetts business trust. Each fund is authorized to
issue an unlimited number of shares. The following summarizes the
significant accounting policies of the funds:
SECURITY VALUATION. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost and
thereafter assume a constant amortization to maturity of any discount or
premium.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, each fund is not subject to income taxes to
the extent that it distributes all of its taxable income for the fiscal
year. The schedules of investments include information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
REPURCHASE AGREEMENTS. The funds, through their custodian, receive delivery
of the underlying securities, whose market value is required to be at least
102% of the resale price at the time of purchase. The funds' investment
adviser, Fidelity Management & Research Company (FMR), is responsible for
determining that the value of these underlying securities remains at least
equal to the resale price.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the fund, along with other affiliated
entities of FMR, may transfer uninvested cash balances into one or more
joint trading accounts. These balances are invested in one or more
repurchase agreements that mature in 60 days or less from the date of
purchase, and are collateralized by U.S. Treasury or Federal Agency
obligations.
RESTRICTED SECURITIES. The Domestic Money Market fund is permitted to
invest in privately placed restricted securities. These securities may be
resold in transactions exempt from registration or to the public if the
securities are registered. Disposal of these securities may involve
time-consuming negotiations and expense, and prompt sale at an acceptable
price may be difficult. At the end of the period, restricted securities
(excluding 144A issues) amounted to $26,998,985 or 6.8% of net assets for
Domestic Money Market fund.
3. JOINT TRADING ACCOUNT.
At the end of the period, U.S. Government fund had 20% or more of its total
investments in repurchase agreements through a joint trading account. These
repurchase agreements were with entities whose creditworthiness has been
reviewed and found satisfactory by FMR. The repurchase agreements were
dated August 31,1994 and due September 1, 1994. The maturity values of the
joint trading account investments were $25,515,445 at 4.86% and $32,004,349
at 4.89% for the U.S. Government fund. The investments in repurchase
agreements through the joint trading account are summarized as follows:
3. JOINT TRADING ACCOUNT - CONTINUED
MAXIMUM
AMOUNT AGGREGATE AGGREGATE AGGREGATE
NO. OF WITH ONE PRINCIPAL MATURITY MARKET COUPON MATURITY
DEALERS DEALER AMOUNT OF AMOUNT OF VALUE OF RATES OF DATES OF
OR BANKS OR BANK AGREEMENTS AGREEMENTS COLLATERAL COLLATERAL COLLATERAL
At 4.86% 7 26.3% $ 760,045,000 $ 760,147,617 $ 776,767,241 3.875%-13.375%
9/22/94-8/15/23
At 4.89% 4 42.9 1,750,000,000 1,750,237,819 1,801,920,348 0%-13.5%
9/1/94-4/1/34
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, FMR pays all expenses
except the compensation of the non-interested Trustees and certain
exceptions such as interest, taxes, brokerage commissions and extraordinary
expenses. FMR receives a fee that is computed daily at an annual rate of
.42% of each fund's average net assets.
SUB-ADVISER FEE. As each fund's investment sub-adviser, FMR Texas Inc., a
wholly owned subsidiary of FMR, receives a fee from FMR of 50% of the
management fee payable to FMR. The fees are paid prior to any voluntary
expense reimbursements which may be in effect, and after reducing the fee
for any payments by FMR pursuant to each fund's Distribution and Service
Plan.
DISTRIBUTION AND SERVICE PLAN. Pursuant to the Distribution and Service
Plans (the Plans), and in accordance with Rule 12b-1 of the 1940 Act, FMR
or the funds' distributor, Fidelity Distributors Corporation (FDC), an
affiliate of FMR, may use their resources to pay administrative and
promotional expenses related to the sale of each fund's shares. Subject to
the approval of each Board of Trustees, the Plans also authorize payments
to third parties that assist in the sale of each fund's shares or render
shareholder support services. FMR or FDC has informed the funds that
payments made to third parties under the Plans amounted to $2,357 for the
U.S. Treasury fund for the period. No payments were made for the U.S.
Government and Domestic Money Market funds.
5. BENEFICIAL INTEREST
At the end of the period, certain shareholders were record owners of
approximately 10% or more of the total outstanding shares of the following
funds:
FUND NUMBER OF SHAREHOLDERS % OWNERSHIP
U.S. Government Portfolio 2 31
Domestic Market Portfolio 2 24
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL INFORMATION OF THE
SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUND UNLESS
PRECEDED OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS. MUTUAL FUND SHARES ARE
NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE
FDIC, THE FEDERAL RESERVE BOARD OR ANY
OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISK, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL. NEITHER THE FUND NOR
FIDELITY DISTRIBUTORS CORPORATION IS A BANK. FOR MORE INFORMATION ON ANY
FIDELITY FUND INCLUDING CHARGES AND
EXPENSES, CALL 1-800-544-0276 FOR A FREE PROSPECTUS. READ IT CAREFULLY
BEFORE YOU INVEST OR SEND MONEY.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Money Market Trust and the Shareholders of U.S.
Treasury Portfolio, U.S. Government Portfolio
and Domestic Money Market Portfolio:
We have audited the accompanying statements of assets and liabilities of
Fidelity Money Market Trust: U.S. Treasury Portfolio, U.S. Government
Portfolio and Domestic Money Market Portfolio including the schedule of
portfolio investments, as of August 31, 1994, and the related statements of
operations for the year then ended, the statements of changes in net assets
for each of the two years in the period then ended, and the financial
highlights for each of the two years in the period then ended, the ten
month period ended August 31, 1992, and for each of the two years in the
period ended October 31, 1991. These financial statements and financial
highlights are the responsibility of the fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of August 31, 1994 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of Fidelity Money Market Trust: U.S. Treasury Portfolio, U.S. Government
Portfolio and Domestic Money Market Portfolio as of August 31, 1994, the
results of their operations for the year then ended, the changes in their
net assets for each of the two years in the period then ended, and the
financial highlights for each of the two years in the period then ended,
the ten month period ended August 31, 1992 and for each of the two years in
the period ended October 31, 1991, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
Dallas, Texas
September 26, 1994
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
SUB-ADVISER
FMR Texas Inc.
Irving, TX
TRUSTEES
J. Gary Burkhead
Ralph F. Cox
Phyllis Burke Davis
Richard J. Flynn
Edward C. Johnson 3d
E. Bradley Jones
Donald J. Kirk
Peter S. Lynch
Edward H. Malone
Marvin L. Mann
Gerald C. McDonough
Thomas R. Williams
OFFICERS
Edward C. Johnson 3d, PRESIDENT
J. Gary Burkhead, SENIOR VICE PRESIDENT
Fred L. Henning, Jr., VICE PRESIDENT
Leland Barron, VICE PRESIDENT
Burnell Stehman, VICE PRESIDENT
Thomas D. Maher, ASSISTANT VICE PRESIDENT
Gary L. French, TREASURER
John H. Costello, ASSISTANT TREASURER
Leonard M. Rush, ASSISTANT TREASURER
Arthur S. Loring, SECRETARY
CUSTODIAN
Morgan Guaranty Trust Company of New York
New York, NY
TRANSFER AND
SHAREHOLDER
SERVICING AGENT
Fidelity Investments Institutional
Operations Company
Boston, MA
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
FMMT-10-94A
PART C - OTHER INFORMATION
Item 24. (a) Audited financial statements and financial highlights for each
Portfolio of the Trust for the fiscal year ended August 31, 1994 are
electronically filed herein as Exhibit 24(a).
(b) Exhibits:
1. Declaration of Trust, dated August 21, 1978, is incorporated herein by
reference to Exhibit 1 to Post-Effec- tive Amendment No.
10.
(a) Supplement to Declaration of Trust, dated November 22, 1978, is
incorporated herein by reference to Exhibit 1(a) to Non-InPost-Effective
Amendment No. 10.
(b) Supplement to Declaration of Trust, dated January 3, 1980, is
incorporated herein by reference to Exhibit 1(b) to Post-Effective
Amendment No. 10.
(c) Supplement to Declaration of Trust, dated January 2, 1987, is
incorporated herein by reference to Exhibit 1(c) to Post-Effective
Amendment No. 21.
(d) Amended and Restated Declaration of Trust, dated November 1, 1989, is
incorporated herein by reference to Exhibit (d) to Post-Effective Amendment
No. 29
2. By-laws of the Trust were electronically filed and are incorported
herein by reference to Exhibit 2(a) to Union Street Trust II's
Post-Effective Amendment No. 10.
3. Not applicable.
4. Not applicable.
5. (a) Management Contract between Fidelity Money Market Trust: U.S.
Treasury Portfolio and Fidelity
Management & Research Company is incorporated herein by reference to
Exhibit 5(a) to Post-
Effective Amendment No. 19.
(b) Management Contract between Fidelity Money Market Trust: U.S.
Government Portfolio and Fidelity Management & Research Company is
incorporated herein by reference to Exhibit 5(b) to Post-Effective
Amendment No. 19.
(c) Management Contract between Fidelity Money Market Trust: Domestic
Money Market Portfolio and Fidelity Management & Research Company is
incorporated herein by reference to Exhibit 5(c) to Post-Effective
Amendment No. 19.
(d) Management Contract between Fidelity Money Market Trust: Retirement
Money Market Portfolio and Fidelity Management & Research Company is
incorporated herein by reference to Exhibit 5(d) to Post-Effective
Amendment No. 25.
(e) Management Contract between Fidelity Money Market Trust: Retirement
Government Money Market Portfolio and Fidelity Management & Research
Company is incorporated herein by reference to Exhibit 5(e) to
Post-Effective Amendment No. 25.
(f) Sub-Advisory Agreement between Fidelity Money Market Trust: U.S.
Treasury Portfolio and FMR Texas dated November 1, 1989 is incorporated
herein by reference to Exhibit 5(f) to Post Effective Amendment No. 30.
(g) Sub-Advisory Agreement between Fidelity Money Market Trust: Domestic
Money Market Portfolio and FMR Texas dated November 1, 1989 is incorporated
herein by reference to Exhibit 5(g) to Post-Effective Amendment No. 30.
(h) Sub-Advisory Agreement between Fidelity Money Market Trust: U.S.
Government Portfolio and FMR Texas dated November 1, 1989 is incorporated
herein by reference to Exhibit 5(h) to Post-Effective Amendment No. 30.
(i) Sub-Advisory Agreement between Fidelity Money Market Trust: Retirement
Money Market Portfolio and FMR Texas dated November 1, 1989 is incorporated
herein by reference to Exhibit 5(i) to Post-Effective Amendment No. 30.
(j) Sub-Advisory Agreement between Fidelity Money Market Trust: Retirement
Government Money Market Portfolio and FMR Texas dated November 1, 1989 is
incorporated herein by reference to Exhibit 5(j) to Post-Effective
Amendment No. 30.
6. (a) General Distribution Agreement between Fidelity Money Market Trust:
U.S. Treasury Portfolio
and Fidelity Distributors Corporation dated April 1, 1987 is incorporated
herein by reference to
Exhibit 6(f) to Post-Effective Amendment No. 29.
(b) General Distribution Agreement between Fidelity Money Market Trust:
U.S. Government Portfolio and Fidelity Distributors Corporation dated April
1, 1987 is incorporated herein by reference to Exhibit 6(g) to
Post-Effective Amendment No. 29.
(c) General Distribution Agreement between Fidelity Money Market Trust:
Domestic Money Market Portfolio and Fidelity Distributors Corporation dated
April 1, 1987 is incorporated herein by reference to Exhibit 6(h) to
Post-Effective Amendment No. 29.
(d) General Distribution Agreement between Fidelity Money Market Trust:
Retirement Money Market Portfolio and Fidelity Distributors Corporation is
incorporated herein by reference to Exhibit 6(d) to Post-Effective
Amendment No. 25.
(e) General Distribution Agreement between Fidelity Money Market Trust:
Retirement Government Money Market Portfolio and Fidelity Distributors
Corporation is incorporated herein by reference to Exhibit 6(e) to
Post-Effective Amendment No. 25.
(f) Amendment to the General Distribution Agreement between Fidelity Money
Market Trust: U.S. Treasury Portfolio, U.S. Government Portfolio, and
Domestic Money Market Portfolio and Fidelity Distributors Corporation dated
January 1, 1988 is incorporated herein by reference to Exhibit 6(i) to
Post-Effective Amendment No. 29.
7. Retirement Plan for Non-Interested Person Trustees, Directors or
General Partners, effective November 1, 1989, is incorporated herein by
reference to Exhibit 7 to Union Street Trust's Post-Effective Amendment No.
87.
8. (a) Custodian Contract, dated January 5, 1979, between the Fund and
First National Bank of Boston is incorporated herein by reference to
Exhibit 5(b) to Form N-1Q for the quarter ended 3/31/79.
(b) Letter containing basis of Custodian's remuneration was filed as
Exhibit 8(b) to Post-Effective Amendment No. 7.
(c) Custodian Contract between Fidelity Money Market Trust: Retirement
Money Market Portfolio and Retirement Government Money Market Portfolio and
Security Pacific National Bank dated July 22, 1988 is incorporated herein
by reference to Exhibit 8(c) to Post-Effective Amendment No. 33.
(d) Amendment Letter to Custodian Contract between Fidelity Money Market
Trust: Retirement Money Market Portfolio and Retirement Government Money
Market Portfolio and Security Pacific National Bank dated November 20, 1989
is incorporated herein by reference to Exhibit 8(d) to Post-Effective
Amendment No. 33.
(e) Custodian Contract, dated July 18, 1983, between the Fund and First
National Bank of Boston is incorporated herein by reference to Exhibit 8(e)
to Post-Effective Amendment No. 33.
(f) Sub-Custodian Contract between The First National Bank of Boston and
Shawmut Bank of Boston, N.A. dated April 12, 1982 is incorporated herein by
reference to Exhibit 8(f) to Post-Effective Amendment No. 29.
(g) Custodian Agreement between the Trust and Morgan Guaranty Trust Company
of New York dated July 18, 1991 is electronically filed herein as Exhibit
8(g).
9. (a) Amended Service Agreement between Fidelity Money Market Trust and
Fidelity Service Co. dated June 1, 1989 is incorporated herein by reference
to Exhibit 9(a) to Post-Effective Amendment No. 33.
(b) Amended Transfer Agency Agreement between Fidelity Money Market Trust
and Fidelity Investments Institutional Operations Company dated June 1,
1989 is incorporated herein by reference to Exhibit 9(b) to Post-Effective
Amendment No. 33.
(c) Schedules A (transfer, dividend disbursing and shareholders'
servicing); B (pricing and bookkeeping); and C (securities lending
transactions) dated June 1, 1989, pertaining to Fidelity Money Market
Trust: U.S. Treasury Portfolio, are incorporated herein by reference to
Exhibit 9(c) to Post-Effective Amendment No. 33.
(d) Schedules A (transfer, dividend disbursing and shareholders'
servicing); B (pricing and bookkeeping); and C (securities lending
transactions) dated June 1, 1989, pertaining to Fidelity Money Market
Trust: U.S. Government Portfolio, are incorporated herein by reference to
Exhibit 9(d) to Post-Effective Amendment No. 33.
(e) Schedules A (transfer, dividend disbursing and shareholders'
servicing); B (pricing and bookkeeping); and C (securities lending
transactions) dated June 1, 1989, pertaining to Fidelity Money Market
Trust: Domestic Money Market Portfolio, are incorporated herein by
reference to Exhibit 9(e) to Post-Effective Amendment No. 33.
(f) Schedules A (transfer, dividend disbursing and shareholders'
servicing); B (pricing and bookkeeping); and C (securities lending
transactions) dated June 1, 1989, pertaining to Fidelity Money Market
Trust: Retirement Money Market Portfolio, are incorporated herein by
reference to Exhibit 9(f) to Post-Effective Amendment No. 33.
(g) Schedules A (transfer, dividend disbursing and shareholders'
servicing); B (pricing and bookkeeping); and C (securities lending
transactions) dated June 1, 1989, pertaining to Fidelity Money Market
Trust: Retirement Government Money Market Portfolio, are incorporated
herein by reference to Exhibit 9(g) to Post-Effective Amendment No. 33.
(h) Form of Schedule B (pricing and bookkeeping) dated July 1, 1991,
pertaining to Fidelity Money Market Trust: U.S. Treasury Portfolio, is
incorporated herein by reference as Exhibit 9(h) to Post-Effective
Amendment No. 36.
(i) Form of Schedule B (pricing and bookkeeping) dated July 1, 1991,
pertaining to Fidelity Money Market Trust: U.S. Government Portfolio, is
incorporated herein by reference as Exhibit 9(i) to Post-Effective
Amendment No. 36
(j) Form of Schedule B (pricing and bookkeeping) dated July 1, 1991,
pertaining to Fidelity Money Market Trust: Domestic Money Market Portfolio,
is incorporated herein by reference as Exhibit 9(j) to Post-Effective
Amendment No. 36.
(k) Form of Schedule B (pricing and bookkeeping) dated July 1, 1991,
pertaining to Fidelity Money Market Trust: Retirement Money Market
Portfolio, is incorporated herein by reference as Exhibit 9(k) to
Post-Effective Amendment No. 36.
(l) Form of Schedule B (pricing and bookkeeping) dated July 1, 1991,
pertaining to Fidelity Money Market Trust: Retirement Government Money
Market Portfolio, is incorporated herein by reference as Exhibit 9(l) to
Post-Effective Amendment No. 36.
10. Not applicable.
11. The Consent of Coopers & Lybrand L.L. P. is filed herein as Exhibit
11.
12. Not applicable.
13. Not applicable.
14. The following plans apply to Fidelity Money Market Trust: Retirement
Money Market Portfolio and Retirement Government Money Market Portfolio:
(a) IRA Custodial Agreement and Disclosure Statement is incorporated herein
as Exhibit 14(a) to Post-Effective Amendment No. 36.
(b) Defined Contribution Retirement Plan and Trust Agreement is
incorporated herein as Exhibit 14(b) to Post-Effective Amendment No. 36.
(c) Defined Benefit Pension Plan and Trust is incorporated herein as
Exhibit 14(c) to Post-Effective Amendment No. 36.
(d) IRA Custodial Agreement and Disclosure Statement ("Group") is
incorporated herein as Exhibit 14(d) to Post-Effective Amendment No. 36.
(e) Master Plan for Savings and Investments is incorporated herein as
Exhibit 14(e) to Post-Effective Amendment No. 36.
(f) 401(a) Prototype Plan for Tax-Exempt Employees is incorporated herein
as Exhibit 14(f) to Post-Effective Amendment No. 36.
15. (a) Distribution and Service Plan of Fidelity Money Market Trust: U.S.
Treasury Portfolio is incorporated herein by reference to Exhibit 15(a) to
Post-Effective Amendment No. 19.
(b) Distribution and Service Plan of Fidelity Money Market Trust: U.S.
Government Portfolio is incorporated herein by reference to Exhibit 15(b)
to Post-Effective Amendment No. 19.
(c) Distribution and Service Plan of Fidelity Money Market Trust:
Domestic Money Market Portfolio is incorporated herein by reference to
Exhibit 15(c) to Post-Effective Amendment No. 19.
(d) Distribution and Service Plan of Fidelity Money Market Trust:
Retirement Money Market Portfolio is incorporated herein by reference to
Exhibit 15(d) to Post-Effective Amendment No. 23.
(e) Distribution and Service Plan of Fidelity Money Market Trust:
Retirement Government Money Market Portfolio is incorporated herein by
reference to Exhibit 15(e) to Post-Effective Amendment No. 23.
16. (a) The schedule for calculation of performance for the Retirement
Money Market Portfolio is incorporated herein by reference to Exhibit 16(a)
to Post-Effective Amendment No. 23.
(b) The schedule for calculation of performance for the Retirement
Government Money Market Portfolio is incorporated herein by reference to
Exhibit 16(b) to Post-Effective Amendment No. 23.
(c) The schedule for calculation of performance for the U.S. Treasury
Portfolio is incorporated herein by reference to Exhibit 16(c) to
Post-Effective Amendment No. 25.
(d) The schedule for calculation of performance for the U.S. Government
Portfolio is incorporated herein by reference to Exhibit 16(d) to
Post-Effective Amendment No. 25.
(e) The schedule for calculation of performance for the Domestic Money
Market Portfolio is incorporated herein by reference to Exhibit 16(e) to
Post-Effective Amendment No. 25.
17. A Financial Data Schedule is filed herein as Exhibit 17.
Item 25. Persons Controlled by or under Common Control with Registrant
The Board of Trustees of Registrant is the same as the boards of the other
Fidelity funds, each of which has Fidelity Management & Research Company as
its investment adviser. In addition, the officers of these funds are
substantially identical. Nonetheless, Registrant takes the position that
it is not under common control with these other funds since the power
residing in the respective Boards and officers arises as the result of an
official position with the respective funds.
Item 26. Number of Holders of Securities
November 30, 19994
Title of Class: Shares of Beneficial Interest
Name of Series Number of Record Holders
Domestic Money Market Portfolio 1,460
U.S. Government Portfolio 1,019
U.S. Treasury Portfolio 615
Retirement Money Market Portfolio 600,544
Retirement Government Money Market Portfolio 422,686
Item 27. Indemnification
Article XI, Section 2 of the Declaration of Trust sets forth the reasonable
and fair means for determining whether indemnification shall be provided to
any past or present Trustee or officer. It states that the Registrant
shall indemnify any present or past Trustee or officer to the fullest
extent permitted by law against liability and all expenses reasonably
incurred by him in connection with any claim, action, suit or proceeding in
which he is involved by virtue of his service as a trustee, an officer, or
both. Additionally, amounts paid or incurred in settlement of such matters
are covered by this indemnification. Indemnification will not be provided
in certain circumstances, however. These include instances of willful
misfeasance, bad faith, gross negligence, and reckless disregard of the
duties involved in the conduct of the particular office involved.
Item 28. Business and Other Connections of Investment Adviser
(1) FIDELITY MANAGEMENT & RESEARCH COMPANY
FMR serves as investment adviser to a number of other investment
companies. The directors and officers of the Adviser have held, during the
past two fiscal years, the following positions of a substantial nature.
<TABLE>
<CAPTION>
<S> <C>
Edward C. Johnson 3d Chairman of the Executive Committee of FMR; President
and Chief Executive Officer of FMR Corp.; Chairman of
the Board and a Director of FMR, FMR Corp., FMR Texas
Inc., Fidelity Management & Research (U.K.) Inc., and
Fidelity Management & Research (Far East) Inc.; President
and Trustee of funds advised by FMR.
J. Gary Burkhead President of FMR; Managing Director of FMR Corp.;
President and a Director of FMR Texas Inc., Fidelity
Management & Research (U.K.) Inc., and Fidelity
Management & Research (Far East) Inc.; Senior Vice
President and Trustee of funds advised by FMR.
Peter S. Lynch Vice Chairman and Director of FMR (1992).
Robert Beckwitt Vice President of FMR and of funds advised by FMR.
David Breazzano Vice President of FMR (1993) and of a fund advised by
FMR.
Stephan Campbell Vice President of FMR (1993).
Dwight Churchill Vice President of FMR (1993).
Rufus C. Cushman, Jr. Vice President of FMR and of funds advised by FMR;
Corporate Preferred Group Leader.
Will Danoff Vice President of FMR (1993) and of a fund advised by
FMR.
Scott DeSano Vice President of FMR (1993).
Penelope Dobkin Vice President of FMR and of a fund advised by FMR.
Larry Domash Vice President of FMR (1993).
George Domolky Vice President of FMR (1993) and of a fund advised by
FMR.
Robert K. Duby Vice President of FMR.
Margaret L. Eagle Vice President of FMR and of a fund advised by FMR.
Kathryn L. Eklund Vice President of FMR.
Richard B. Fentin Senior Vice President of FMR (1993) and of a fund advised
by FMR.
Daniel R. Frank Vice President of FMR and of funds advised by FMR.
Gary L. French Vice President of FMR and Treasurer of the funds advised
by FMR.
Michael S. Gray Vice President of FMR and of funds advised by FMR.
Lawrence Greenberg Vice President of FMR (1993).
Barry A. Greenfield Vice President of FMR and of a fund advised by FMR.
William J. Hayes Senior Vice President of FMR; Equity Division Leader.
Robert Haber Vice President of FMR and of funds advised by FMR.
Richard Haberman Senior Vice President of FMR (1993).
Daniel Harmetz Vice President of FMR and of a fund advised by FMR.
Ellen S. Heller Vice President of FMR.
</TABLE>
John Hickling Vice President of FMR (1993) and of funds advised by
FMR.
<TABLE>
<CAPTION>
<S> <C>
Robert F. Hill Vice President of FMR; and Director of Technical
Research.
Stephen Jonas Treasurer and Vice President of FMR (1993); Treasurer of
FMR Texas Inc. (1993), Fidelity Management & Research
(U.K.) Inc. (1993), and Fidelity Management & Research
(Far East) Inc. (1993).
David B. Jones Vice President of FMR (1993).
Steven Kaye Vice President of FMR (1993) and of a fund advised by
FMR.
Frank Knox Vice President of FMR (1993).
Robert A. Lawrence Senior Vice President of FMR (1993); and High Income
Division Leader.
Alan Leifer Vice President of FMR and of a fund advised by FMR.
Harris Leviton Vice President of FMR (1993) and of a fund advised by
FMR.
Bradford E. Lewis Vice President of FMR and of funds advised by FMR.
Malcolm W. McNaught III Vice President of FMR (1993).
Robert H. Morrison Vice President of FMR and Director of Equity Trading.
David Murphy Vice President of FMR and of funds advised by FMR.
Andrew Offit Vice President of FMR (1993).
Judy Pagliuca Vice President of FMR (1993).
Jacques Perold Vice President of FMR.
Anne Punzak Vice President of FMR and of funds advised by FMR.
Lee Sandwen Vice President of FMR (1993).
Patricia A. Satterthwaite Vice President of FMR (1993) and of a fund advised by
FMR.
Thomas T. Soviero Vice President of FMR (1993).
Richard A. Spillane Vice President of FMR and of funds advised by FMR; and
Director of Equity Research.
Robert E. Stansky Senior Vice President of FMR (1993) and of funds advised
by FMR.
Thomas Steffanci Senior Vice President of FMR (1993); and Fixed-Income
Division Leader.
Gary L. Swayze Vice President of FMR and of funds advised by FMR; and
Tax-Free Fixed-Income Group Leader.
Thomas Sweeney Vice President of FMR (1993).
Donald Taylor Vice President of FMR (1993) and of funds advised by
FMR.
Beth F. Terrana Senior Vice President of FMR (1993) and of funds advised
by FMR.
Joel Tillinghast Vice President of FMR (1993) and of a fund advised by
FMR.
Robert Tucket Vice President of FMR (1993).
George A. Vanderheiden Senior Vice President of FMR; Vice President of funds
advised by FMR; and Growth Group Leader.
Jeffrey Vinik Senior Vice President of FMR (1993) and of a fund advised
by FMR.
Guy E. Wickwire Vice President of FMR and of a fund advised by FMR.
Arthur S. Loring Senior Vice President (1993), Clerk and General Counsel of
FMR; Vice President, Legal of FMR Corp.; and Secretary
of funds advised by FMR.
</TABLE>
(4) FMR TEXAS INC. (FMR Texas)
FMR Texas provides investment advisory services to Fidelity Management &
Research Company. The directors and officers of the Sub-Adviser have held
the following positions of a substantial nature during the past two fiscal
years.
<TABLE>
<CAPTION>
<S> <C>
Edward C. Johnson 3d Chairman and Director of FMR Texas; Chairman of the
Executive Committee of FMR; President and Chief
Exective Officer of FMR Corp.; Chairman of the Board
and a Director of FMR, FMR Corp., Fidelity
Management & Research (Far East) Inc. and Fidelity
Management & Research (U.K.) Inc.; President and
Trustee of funds advised by FMR.
J. Gary Burkhead President and Director of FMR Texas; President of FMR;
Managing Director of FMR Corp.; President and a
Director of Fidelity Management & Research (Far East)
Inc. and Fidelity Management & Research (U.K.) Inc.;
Senior Vice President and Trustee of funds advised by
FMR.
Fred L. Henning, Jr. Senior Vice President of FMR Texas; Money Market
Division Leader.
Robert Auld Vice President of FMR Texas (1993).
Leland Barron Vice President of FMR Texas and of funds advised by
FMR.
Robert Litterst Vice President of FMR Texas and of funds advised by
FMR (1993).
Thomas D. Maher Vice President of FMR Texas and Assistant Vice
President of funds advised by FMR.
Burnell R. Stehman Vice President of FMR Texas and of funds advised by
FMR.
John J. Todd Vice President of FMR Texas and of funds advised by
FMR.
Sarah H. Zenoble Vice President of FMR Texas and of funds advised by
FMR.
Steven Jonas Treasurer of FMR Texas Inc. (1993), Fidelity Manage-
ment & Research (U.K.) Inc. (1993), and Fidelity Man-
agement & Research (Far East) Inc. (1993); Treasurer
and Vice President of FMR (1993).
David C. Weinstein Secretary of FMR Texas; Clerk of Fidelity Management
& Research (U.K.) Inc.; Clerk of Fidelity Management &
Research (Far East) Inc.
</TABLE>
Item 29. Principal Underwriters
(a) Fidelity Distributors Corporation (FDC) acts as distributor for most
funds advised by FMR and the following other funds:
CrestFunds, Inc.
ARK Funds
(b)
Name and Principal Positions and Offices Positions and Offices
Business Address* With Underwriter With Registrant
Edward C. Johnson 3d Director Trustee and President
Nita B. Kincaid Director None
W. Humphrey Bogart Director None
Kurt A. Lange President and Treasurer None
William L. Adair Senior Vice President None
Thomas W. Littauer Senior Vice President None
Arthur S. Loring Vice President and Clerk Secretary
* 82 Devonshire Street, Boston, MA
(c) Not applicable.
Item 30. Location of Accounts and Records
All accounts, books and other documents required to be maintained by
Section 31a of the 1940 Act and the Rules promulgated thereunder are
maintained by The Corporation Trust Company, 1209 Orange St., Wilmington
DE, 19801.
Item 31. Management Services.
Not applicable.
Item 32. Undertakings.
Not applicable.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all
of the requirements for the effectiveness of this Registration Statement
pursuant to Rule 485(b) under the Securities Act of 1933 and has duly
caused this Post-Effective Amendment No. 46 to the Registration Statement
to be signed on its behalf by the undersigned, thereunto duly authorized,
in the City of Boston, and Commonwealth of Massachusetts, on the 29th day
of December 1994.
FIDELITY MONEY MARKET TRUST
By /s/Edward C. Johnson 3d (dagger)
Edward C. Johnson 3d, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
(Signature) (Title) (Date)
<TABLE>
<CAPTION>
<S> <C> <C>
/s/Edward C. Johnson 3d(dagger) President and Trustee December 20, 1994
Edward C. Johnson 3d (Principal Executive Officer)
</TABLE>
/s/Gary L. French Treasurer December 20, 1994
Gary L. French
/s/J. Gary Burkhead Trustee December 20, 1994
J. Gary Burkhead
/s/Ralph F. Cox * Trustee December 20, 1994
Ralph F. Cox
/s/Phyllis Burke Davis * Trustee December 20, 1994
Phyllis Burke Davis
/s/Richard J. Flynn * Trustee December 20, 1994
Richard J. Flynn
/s/E. Bradley Jones * Trustee December 20, 1994
E. Bradley Jones
/s/Donald J. Kirk * Trustee December 20, 1994
Donald J. Kirk
/s/Peter S. Lynch * Trustee December 20, 1994
Peter S. Lynch
/s/Edward H. Malone * Trustee December 20, 1994
Edward H. Malone
/s/Marvin L. Mann_____* Trustee December 20, 1994
Marvin L. Mann
/s/Gerald C. McDonough* Trustee December 20, 1994
Gerald C. McDonough
/s/Thomas R. Williams * Trustee December 20, 1994
Thomas R. Williams
(dagger) Signatures affixed by J. Gary Burkhead pursuant to a power of
attorney dated October 20, 1993 and filed herewith.
* Signature affixed by Robert C. Hacker pursuant to a power of attorney
dated October 20, 1993 and filed herewith.
POWER OF ATTORNEY
We, the undersigned Directors, Trustees or General Partners, as the case
may be, of the following investment companies:
<TABLE>
<CAPTION>
<S> <C>
Daily Money Fund Fidelity Institutional Tax-Exempt Cash Portfolios
Daily Tax-Exempt Money Fund Fidelity Institutional Investors Trust
Fidelity Beacon Street Trust Fidelity Money Market Trust II
Fidelity California Municipal Trust II Fidelity Municipal Trust II
Fidelity Court Street Trust II Fidelity New York Municipal Trust II
Fidelity Hereford Street Trust Fidelity Phillips Street Trust
Fidelity Institutional Cash Portfolios Fidelity Union Street Trust II
</TABLE>
in addition to any other investment company for which Fidelity Management &
Research Company acts as investment adviser and for which the undersigned
individual serves as a Director, Trustee or General Partner (collectively,
the "Funds"), hereby severally constitute and appoint Arthur J. Brown,
Arthur C. Delibert, Robert C. Hacker, Richard M. Phillips, Dana L. Platt
and Stephanie Xupolos, each of them singly, my true and lawful
attorney-in-fact, with full power of substitution, and with full power to
each of them, to sign for me and my name in the appropriate capacities any
Registration Statements of the Funds on Form N-1A or any successor thereto,
any and all subsequent Pre-Effective Amendments or Post-Effective
Amendments to said Registration Statements on Form N-1A or any successor
thereto, any Registration Statements on Form N-14, and any supplements or
other instruments in connection therewith, and generally to do all such
things in my name and behalf in connection therewith as said
attorneys-in-fact deem necessary or appropriate, to comply with the
provisions of the Securities Act of 1933 and Investment Company Act of
1940, and all related requirements of the Securities and Exchange
Commission, hereby ratifying and confirming all that said attorney-in-fact
or their substitutes may do or cause to be done by virtue hereof.
WITNESS our hands on this twentieth day of October, 1993.
/s/Edward C. Johnson 3d /s/Donald J. Kirk
Edward C. Johnson 3d Donald J. Kirk
/s/J. Gary Burkhead /s/Peter S. Lynch
J. Gary Burkhead Peter S. Lynch
/s/Ralph F. Cox /s/Marvin L. Mann
Ralph F. Cox Marvin L. Mann
/s/Phyllis Burke Davis /s/Edward H. Malone
Phyllis Burke Davis Edward H. Malone
/s/Richard J. Flynn /s/Gerald C. McDonough
Richard J. Flynn Gerald C. McDonough
/s/E. Bradley Jones /s/Thomas R. Williams
E. Bradley Jones Thomas R. Williams
POWER OF ATTORNEY
I, the undersigned President and Director, Trustee or General Partner, as
the case may be, of the following investment companies:
<TABLE>
<CAPTION>
<S> <C>
Daily Money Fund Fidelity Institutional Tax-Exempt Cash Portfolios
Daily Tax-Exempt Money Fund Fidelity Institutional Investors Trust
Fidelity Beacon Street Trust Fidelity Money Market Trust II
Fidelity California Municipal Trust II Fidelity Municipal Trust II
Fidelity Court Street Trust II Fidelity New York Municipal Trust II
Fidelity Hereford Street Trust Fidelity Phillips Street Trust
Fidelity Institutional Cash Portfolios Fidelity Union Street Trust II
</TABLE>
in addition to any other investment company for which Fidelity Management &
Research Company acts as investment adviser and for which the undersigned
individual serves as President and Board Member (collectively, the
"Funds"), hereby severally constitute and appoint J. Gary Burkhead, my true
and lawful attorney-in-fact, with full power of substitution, and with full
power to sign for me and in my name in the appropriate capacity any
Registration Statements of the Funds on Form N-1A, Form N-8A or any
successor thereto, any and all subsequent Pre-Effective Amendments or
Post-Effective Amendments to said Registration Statements on Form N-1A or
any successor thereto, any Registration Statements on Form N-14, and any
supplements or other instruments in connection therewith, and generally to
do all such things in my name and behalf in connection therewith as said
attorney-in-fact deem necessary or appropriate, to comply with the
provisions of the Securities Act of 1933 and Investment Company Act of
1940, and all related requirements of the Securities and Exchange
Commission. I hereby ratify and confirm all that said attorneys-in-fact or
their substitutes may do or cause to be done by virtue hereof.
WITNESS my hand on the date set forth below.
/s/Edward C. Johnson 3d October 20, 1993
Edward C. Johnson 3d
CUSTODIAN AGREEMENT
AGREEMENT made as of the 18th day of July between Fidelity Money Market
Trust (the "Fund") and Morgan Guaranty Trust Company of New York (the
"Custodian").
W I T N E S S E T H
WHEREAS, the Fund may, from time to time organize one or more series of
shares, in addition to the series set forth in Appendix "A" attached
hereto, each of which shall represent an interest in a separate portfolio
of cash, securities and other assets (all such existing and additional
series now or hereafter listed on Appendix "A" being hereinafter referred
to individually, as a "Portfolio," and collectively, as the "Portfolios");
and
WHEREAS, the Fund desires to appoint the Custodian as custodian on behalf
of the Portfolios in accordance with the provisions of the Investment
Company Act of 1940 (the "1940 Act") and the rules and regulations
thereunder, under the terms and conditions set forth in this Agreement, and
the Custodian has agreed so to act as custodian.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto agree as follows:
ARTICLE I
APPOINTMENT OF CUSTODIAN
On behalf of the Portfolios, the Fund hereby employs and appoints the
Custodian as a custodian, subject to the terms and provisions of this
Agreement. The Fund shall deliver to the Custodian, or shall cause to be
delivered to the Custodian, cash, securities and other assets owned by the
Portfolios from time to time during the term of this Agreement and shall
specify the Portfolio to which such cash, securities and other assets are
to be specifically allocated.
ARTICLE II
POWERS AND DUTIES OF CUSTODIAN
As custodian, the Custodian shall have and perform the powers and duties
set forth in this Article II. Pursuant to and in accordance with Article
IV hereof, the Custodian may appoint one or more Subcustodians (as
hereinafter defined) to exercise the powers and perform the duties of the
Custodian set forth in this Article II and references to the Custodian in
this Article II shall include any Subcustodian so appointed.
Section 2.01. Safekeeping. The Custodian shall keep safely all cash,
securities and other assets of the Portfolios delivered to the Custodian
and, on behalf of the Portfolios, the Custodian shall, from time to time,
accept delivery of cash, securities and other assets for safekeeping.
Section 2.02. Manner of Holding Securities.
(a) The Custodian shall at all times hold securities of the Portfolios
either: (i) by physical possession of the share certificates or other
instruments representing such securities in registered or bearer form; or
(ii) in book-entry form by a Securities System (as hereinafter defined) in
accordance with the provisions of Section 2.22 below.
(b) The Custodian shall at all times hold registered securities of each
Portfolio in the name of the Custodian, the Portfolio or a nominee of
either of them, unless specifically directed by Proper Instructions to hold
such registered securities in so-called street name; provided that, in any
event, all such securities and other assets shall be held in an account of
the Custodian containing only assets of a Portfolio, or only assets held by
Custodian as a fiduciary or custodian for customers, and provided further,
that the records of the Custodian shall indicate at all times the Portfolio
or other customer for which such securities and other assets are held in
such account and the respective interests therein.
Section 2.03. Security Purchases. Upon receipt of Proper Instructions
(as hereinafter defined), the Custodian shall pay for and receive
securities purchased for the account of a Portfolio, provided that payment
shall be made by Custodian only upon receipt of the securities: (a) by the
Custodian; (b) by a clearing corporation of a national securities exchange
of which the Custodian is a member; or (c) by a Securities System.
Notwithstanding the foregoing, upon receipt of Proper Instructions: (i) in
the case of a repurchase agreement, the Custodian may release funds to a
Securities System prior to the receipt of advice from the Securities System
that the securities underlying such repurchase agreement have been
transferred by book-entry into the Account (as hereinafter defined)
maintained with such Securities System by the Custodian, provided that the
Custodian's instructions to the Securities system require that the
Securities System may make payment of such funds to the other party to the
repurchase agreement only upon transfer by book-entry of the securities
underlying the repurchase agreement into the Account; (ii) in the case of
time deposits, call account deposits, currency deposits, and other
deposits, foreign exchange transactions, futures contracts or options,
pursuant to Sections 2.09, 2.10, 2.12 and 2.13 hereof, the Custodian may
make payment therefor before receipt of an advice or confirmation
evidencing said deposit or entry into such transaction; (iii) in the case
of the purchase of securities, the settlement of which occurs outside of
the United States of America, the Custodian may make payment therefor and
receive delivery of such securities in accordance with local custom and
practice generally accepted by Institutional Clients (as hereinafter
defined) in the country in which the settlement occurs, but in all events
subject to the standard of care set forth in Article V hereof; and (iv) in
the case of the purchase of securities in which, in accordance with
standard industry custom and practice generally accepted by Institutional
Clients with respect to such securities, the receipt of such securities and
the payment therefor take place in different countries, the Custodian may
receive delivery of such securities and make payment therefor in accordance
with standard industry custom and practice for such securities generally
accepted by Institutional Clients, but in all events subject to the
standard of care set forth in Article V hereof. For purposes of this
Agreement, an "Institutional Client" shall mean a major commercial bank,
corporation, insurance company, or substantially similar institution,
which, as a substantial part of its business operations, purchases or sells
securities and makes use of custodial services.
Section 2.04. Exchanges of Securities. Upon receipt of Proper
Instructions, the Custodian shall exchange securities held by it for the
account of a Portfolio for other securities in connection with any
reorganization, recapitalization, split-up of shares, change of par value,
conversion or other event relating to the securities or the issuer of such
securities, and shall deposit any such securities in accordance with the
terms of any reorganization or protective plan. The Custodian shall,
without receiving Proper Instructions: surrender securities in temporary
form for definitive securities; surrender securities for transfer into the
name of the Custodian, a Portfolio or a nominee of either of them, as
permitted by Section 2.02(b); and surrender securities for a different
number of certificates or instruments representing the same number of
shares or same principal amount of indebtedness, provided that the
securities to be issued will be delivered to the Custodian or a nominee of
the Custodian.
Section 2.05. Sales of Securities. Upon receipt of Proper Instructions,
the Custodian shall make delivery of securities which have been sold for
the account of a Portfolio, but only against payment therefor in the form
of: (a) cash, certified check, bank cashier's check, bank credit, or bank
wire transfer; (b) credit to the account of the custodian with a clearing
corporation of a national securities exchange of which the Custodian is a
member; or (c) credit to the Account of the Custodian with a Securities
System, in accordance with the provisions of Section 2.22 hereof.
Notwithstanding the foregoing: (i) in the case of the sale of securities,
the settlement of which occurs outside of the United States of America,
such securities shall be delivered and paid for in accordance with local
custom and practice generally accepted by Institutional Clients in the
country in which the settlement occurs, but in all events subject to the
standard of care set forth in Article V hereof; (ii) in the case of the
sale of securities in which, in accordance with standard industry custom
and practice generally accepted by Institutional Clients with respect to
such securities, the delivery of such securities and receipt of payment
therefor take place in different countries, the Custodian may deliver such
securities and receive payment therefor in accordance with standard
industry custom and practice for such securities generally accepted by
Institutional Clients, but in all events subject to the standard of care
set forth in Article V hereof; and (iii) in the case of securities held in
physical form, such securities shall be delivered and paid for in
accordance with "street delivery custom" to a broker or its clearing agent,
against delivery to the Custodian of a receipt for such securities,
provided that the Custodian shall have taken reasonable steps to ensure
prompt collection of the payment for, or the return of, such securities by
the broker or its clearing agent, and provided further that the Custodian
shall not be responsible for the selection of or the failure or inability
to perform of such broker or its clearing agent.
Section 2.06. Depositary Receipts. Upon receipt of Proper Instructions,
the Custodian shall surrender securities to the depositary used for such
securities by an issuer of American Depositary Receipts or International
Depositary Receipts (hereinafter referred to, collectively, as "ADRs"),
against a written receipt therefor adequately describing such securities
and written evidence satisfactory to the Custodian that the depositary has
acknowledged receipt of instructions to issue ADRs with respect to such
securities in the name of the Custodian or a nominee of the Custodian, for
delivery to the Custodian at such place as the Custodian may from time to
time designate. Upon receipt of Proper Instructions, the Custodian shall
surrender ADRs to the issuer thereof, against a written receipt therefor
adequately describing the ADRs surrendered and written evidence
satisfactory to the Custodian that the issuer of the ADRs has acknowledged
receipt of instructions to cause its depository to deliver the securities
underlying such ADRs to the Custodian.
Section 2.07. Exercise of Rights; Tender Offers. Upon receipt of Proper
Instructions, the Custodian shall: (a) deliver warrants, puts, calls,
rights or similar securities to the issuer or trustee thereof, or to the
agent of such issuer or trustee, for the purpose of exercise or sale,
provided that the new securities, cash or other assets, if any, acquired as
a result of such actions are to be delivered to the Custodian; and (b)
deposit securities upon invitations for tenders thereof, provided that the
consideration for such securities is to be paid or delivered to the
Custodian, or the tendered securities are to be returned to the Custodian.
Notwithstanding any provision of this Agreement to the contrary, the
Custodian shall take all necessary action, unless otherwise directed to the
contrary in Proper Instructions, to comply with the terms of all mandatory
or compulsory exchanges, calls, tenders, redemptions, or similar rights of
security ownership, and shall promptly notify the Fund of such action in
writing by facsimile transmission or in such other manner as the Fund and
Custodian may agree in writing.
Section 2.08. Stock Dividends, Rights, Etc. The Custodian shall receive
and collect all stock dividends, rights and other items of like nature and,
upon receipt of Proper Instructions, take action with respect to the same
as directed in such Proper Instructions.
Section 2.09. Options. Upon receipt of Proper Instructions and in
accordance with the provisions of any agreement between the Custodian, any
registered broker-dealer and, if necessary, the Fund relating to compliance
with the rules of the Options Clearing Corporation or of any registered
national securities exchange or similar organization(s), the Custodian
shall: (a) receive and retain confirmations or other documents, if any,
evidencing the purchase or writing of an option on a security or securities
index by a Portfolio; (b) deposit and maintain in a segregated account,
securities (either physically or by book-entry in a Securities System),
cash or other assets; and (c) pay, release and/or transfer such securities,
cash or other assets in accordance with notices or other communications
evidencing the expiration, termination or exercise of such options
furnished by the Options Clearing Corporation, the securities or options
exchange on which such options are traded, or such other organization as
may be responsible for handling such option transactions. The Fund and the
broker-dealer shall be responsible for the sufficiency of assets held in
any segregated account established in compliance with applicable margin
maintenance requirements and the performance of other terms of any option
contract.
Section 2.10. Futures Contracts. Upon receipt of Proper Instructions, or
pursuant to the provisions of any futures margin procedural agreement among
the Fund, on behalf of any Portfolio, the Custodian and any futures
commission merchant (a "Procedural Agreement"), the Custodian shall: (a)
receive and retain confirmations, if any, evidencing the purchase or sale
of a futures contract or an option on a futures contract by a Portfolio;
(b) deposit and maintain in a segregated account, cash, securities and
other assets designated as initial, maintenance or variation "margin"
deposits intended to secure the Portfolio's performance of its obligations
under any futures contracts purchased or sold or any options on futures
contracts written by the Portfolio, in accordance with the provisions of
any Procedural Agreement designed to comply with the rules of the Commodity
Futures Trading Commission and/or any commodity exchange or contract market
(such as the Chicago Board of Trade), or any similar organization(s),
regarding such margin deposits; and (c) release assets from and/or transfer
assets into such margin accounts only in accordance with any such
Procedural Agreements. The Fund and such futures commission merchant shall
be responsible for the sufficiency of assets held in the segregated account
in compliance with applicable margin maintenance requirements and the
performance of any futures contract or option on a futures contract in
accordance with its terms.
Section 2.11. Borrowing. Upon receipt of Proper Instructions, the
Custodian shall deliver securities of a Portfolio to lenders or their
agents, or otherwise establish a segregated account as agreed to by the
Fund and the Custodian, as collateral for borrowings effected by the Fund
on behalf of a Portfolio, provided that such borrowed money is payable by
the lender (a) to or upon the Custodian's order, as Custodian for such
Portfolio, and (b) concurrently with delivery of such securities.
Section 2.12. Interest Bearing Deposits.
Upon receipt of Proper Instructions directing the Custodian to purchase
interest bearing fixed term and call deposits (hereinafter referred to
collectively, as "Interest Bearing Deposits") for the account of a
Portfolio, the Custodian shall purchase such Interest Bearing Deposits in
the name of a Portfolio with such banks or trust companies (including the
Custodian, any Subcustodian or any subsidiary or affiliate of the
Custodian) (hereinafter referred to as "Banking Institutions") and in such
amounts as the Fund may direct pursuant to Proper Instructions. Such
Interest Bearing Deposits may be denominated in U.S. Dollars or other
currencies, as the Fund may determine and direct pursuant to Proper
Instructions. The Custodian shall include in its records with respect to
the assets of each Portfolio appropriate notation as to the amount and
currency of each such Interest Bearing Bank Deposit, the accepting Banking
Institution and all other appropriate details, and shall retain such forms
of advice or receipt evidencing such account, if any, as may be forwarded
to the Custodian by the Banking Institution. The responsibilities of the
Custodian to the Fund for Interest Bearing Deposits accepted on the
Custodian's books in the United States shall be that of a U.S. bank for a
similar deposit. With respect to Interest Bearing Deposits other than
those accepted on the Custodian's books, (a) the Custodian shall be
responsible for the collection of income as set forth in Section 2.15 and
the transmission of cash and instructions to and from such accounts; and
(b) the Custodian shall have no duty with respect to the selection of the
Banking Institution or, so long as the Custodian acts in accordance with
Proper Instructions, for the failure of such Banking Institution to pay
upon demand. Upon receipt of Proper Instructions, the Custodian shall take
such reasonable actions as the Fund deems necessary or appropriate to cause
each such Interest Bearing Deposit Account to be insured to the maximum
extent possible by all applicable deposit insurers including, without
limitation, the Federal Deposit Insurance Corporation.
Section 2.13. Foreign Exchange Transactions
(a) Foreign Exchange Transactions Other than as Principal. Upon receipt
of Proper Instructions, the Custodian shall settle foreign exchange
contracts or options to purchase and sell foreign currencies for spot and
future delivery on behalf of and for the account of a Portfolio with such
currency brokers or Banking Institutions as the Fund may determine and
direct pursuant to Proper Instructions. The Custodian shall be responsible
for the transmission of cash and instructions to and from the currency
broker or Banking Institution with which the contract or option is made,
the safekeeping of all certificates and other documents and agreements
evidencing or relating to such foreign exchange transactions and the
maintenance of proper records as set forth in Section 2.25. The Custodian
shall have no duty with respect to the selection of the currency brokers or
Banking Institutions with which the Fund deals or, so long as the Custodian
acts in accordance with Proper Instructions, for the failure of such
brokers or Banking Institutions to comply with the terms of any contract or
option.
(b) Foreign Exchange Contracts as Principal. The Custodian shall not be
obligated to enter into foreign exchange transactions as principal.
However, if the Custodian has made available to the Fund its services as a
principal in foreign exchange transactions, upon receipt of Proper
Instructions, the Custodian shall enter into foreign exchange contracts or
options to purchase and sell foreign currencies for spot and future
delivery on behalf of and for the account of a Portfolio with the Custodian
as principal. The Custodian shall be responsible for the selection of the
currency brokers or Banking Institutions and the failure of such currency
brokers or Banking Institutions to comply with the terms of any contract or
option.
(c) Payments. Notwithstanding anything to the contrary contained herein,
upon receipt of Proper Instructions the Custodian may, in connection with a
foreign exchange contract, make free outgoing payments of cash in the form
of U.S. Dollars or foreign currency prior to receipt of confirmation of
such foreign exchange contract or confirmation that the countervalue
currency completing such contract has been delivered or received.
Section 2.14. Securities Loans. Upon receipt of Proper Instructions, the
Custodian shall, in connection with loans of securities by a Portfolio,
deliver securities of such Portfolio to the borrower thereof prior to
receipt of the collateral, if any, for such borrowing; provided that, in
cases of loans of securities secured by cash collateral, the Custodian's
instructions to the Securities System shall require that the Securities
System deliver the securities of the Portfolio to the borrower thereof only
upon receipt of the collateral for such borrowing.
Section 2.15. Collections. The Custodian shall, and shall cause any
Subcustodian to: (a) collect amounts due and payable to the Fund with
respect to portfolio securities and other assets of each Portfolio; (b)
promptly credit to the account of each Portfolio all income and other
payments relating to portfolio securities and other assets held by the
Custodian hereunder upon Custodian's receipt of such income or payments or
as otherwise agreed in writing by the Custodian and the Fund; (c) promptly
endorse and deliver any instruments required to effect such collections;
and (d) promptly execute ownership and other certificates and affidavits
for all federal, state and foreign tax purposes in connection with receipt
of income or other payments with respect to portfolio securities and other
assets of each Portfolio, or in connection with the transfer of such
securities or other assets; provided, however, that with respect to
portfolio securities registered in so-called street name, the Custodian
shall use its best efforts to collect amounts due and payable to the Fund.
The Custodian shall promptly notify the Fund in writing by facsimile
transmission or in such other manner as the Fund and Custodian may agree in
writing if any amount payable with respect to portfolio securities or other
assets of the Portfolios is not received by the Custodian when due. The
Custodian shall not be responsible for the collection of amounts due and
payable with respect to portfolio securities or other assets that are in
default.
Section 2.16. Dividends, Distributions and Redemptions. The Custodian
shall promptly release funds or securities: (a) upon receipt of Proper
Instructions, to one or more Distribution Accounts designated by the Fund
in such Proper Instructions; or (b) upon receipt of Special Instructions,
as otherwise directed by the Fund, for the purpose of the payment of
dividends or other distributions to shareholders of the Portfolios, and
payment to shareholders who have requested repurchase or redemption of
their shares of the Portfolio(s) (collectively, the "Shares"). For
purposes of this Agreement, a "Distribution Account" shall mean an account
established at a Banking Institution designated by the Fund in Special
Instructions.
Section 2.17. Proceeds from Shares Sold. The Custodian shall receive
funds representing cash payments received for Shares issued or sold from
time to time by the Fund, and shall promptly credit such funds to the
account(s) of the applicable Portfolio(s). The Custodian shall promptly
notify the Fund of Custodian's receipt of cash in payment for Shares issued
by the Fund by facsimile transmission or in such other manner as the Fund
and Custodian may agree in writing. Upon receipt of Proper Instructions,
the Custodian shall: (a) deliver all federal funds received by the
Custodian in payment for Shares in payment for such investments as may be
set forth in such Proper Instructions and at a time agreed upon between the
Custodian and the Fund; and (b) make federal funds available to the Fund as
of specified times agreed upon from time to time by the Fund and the
Custodian, in the amount of checks received in payment for Shares which are
deposited to the accounts of the Portfolios.
Section 2.18. Proxies, Notices, Etc. The Custodian shall deliver to the
Fund, in the most expeditious manner practicable, all forms of proxies, all
notices of meetings, and any other notices or announcements affecting or
relating to securities owned by the Portfolios that are received by the
Custodian, any Subcustodian, or any nominee of either of them, and, upon
receipt of Proper Instructions, the Custodian shall execute and deliver, or
cause such Subcustodian or nominee to execute and deliver, such proxies or
other authorizations as may be required. Except as directed pursuant to
Proper Instructions, neither the Custodian nor any Subcustodian or nominee
shall vote upon any such securities, or execute any proxy to vote thereon,
or give any consent or take any other action with respect thereto.
Section 2.19. Bills and Other Disbursements. Upon receipt of Proper
Instructions, the Custodian shall pay or cause to be paid, all bills,
statements, or other obligations of the Portfolios.
Section 2.20. Nondiscretionary Functions. The Custodian shall attend to
all nondiscretionary details in connection with the sale, exchange,
substitution, purchase, transfer or other dealings with securities or other
assets of the Portfolios held by the Custodian, except as otherwise
directed from time to time pursuant to Proper Instructions.
Section 2.21. Bank Accounts
(a) Accounts with the Custodian and any Subcustodians. The Custodian shall
open and operate a bank account or accounts (hereinafter referred to
collectively, as "Bank Accounts") on the books of the Custodian or any
Subcustodian provided that such account(s) shall be in the name of the
Custodian or a nominee of the Custodian, for the account of a Portfolio,
and shall be subject only to the draft or order of the Custodian; provided
however, that such Bank Accounts in countries other than the United States
may be held in an account of the Custodian containing only assets held by
the Custodian as a fiduciary or custodian for customers, and provided
further, that the records of the Custodian shall indicate at all times the
Portfolio or other customer for which such securities and other assets are
held in such account and the respective interests therein. Such Bank
Accounts may be denominated in either U.S. Dollars or other currencies.
The responsibilities of the Custodian to the Fund for deposits accepted on
the Custodian's books in the United States shall be that of a U.S. bank for
a similar deposit. The responsibilities of the Custodian to the Fund for
deposits accepted on any Subcustodian's books shall be governed by the
provisions of Section 5.02.
(b) Accounts With Other Banking Institutions. The Custodian may open and
operate Bank Accounts on behalf of a Portfolio, in the name of the
Custodian or a nominee of the Custodian, at a Banking Institution other
than the Custodian or any Subcustodian, provided that such account(s) shall
be in the name of the Custodian or a nominee of the Custodian, for the
account of a Portfolio, and shall be subject only to the draft or order of
the Custodian; provided however, that such Bank Accounts may be held in an
account of the Custodian containing only assets held by the Custodian as a
fiduciary or custodian for customers, and provided further, that the
records of the Custodian shall indicate at all times the Portfolio or other
customer for which such securities and other assets are held in such
account and the respective interests therein. Such Bank Accounts may be
denominated in either U.S. Dollars or other currencies. Subject to the
provisions of Section 5.01(a), the Custodian shall be responsible for the
selection of the Banking Institution and for the failure of such Banking
Institution to pay according to the terms of the deposit.
(c) Deposit Insurance. Upon receipt of Proper Instructions, the Custodian
shall take such reasonable actions as the Fund deems necessary or
appropriate to cause each deposit account established by the Custodian
pursuant to this Section 2.21 to be insured to the maximum extent possible
by all applicable deposit insurers including, without limitation, the
Federal Deposit Insurance Corporation.
Section 2.22. Deposit of Fund Assets in Securities Systems. The
Custodian may deposit and/or maintain domestic securities owned by the
Portfolios in: (a) The Depository Trust Company; (b) the Participants
Trust Company; (c) any book-entry system as provided in (i) Subpart O of
Treasury Circular No. 300, 31 CFR 306.115, (ii) Subpart B of Treasury
Circular Public Debt Series No. 27-76, 31 CFR 350.2, or (iii) the
book-entry regulations of federal agencies substantially in the form of 31
CFR 306.115; or (d) any other domestic clearing agency registered with the
Securities and Exchange Commission ("SEC") under Section 17A of the
Securities Exchange Act of 1934 (or as may otherwise be authorized by the
Securities and Exchange Commission to serve in the capacity of depository
or clearing agent for the securities or other assets of investment
companies) which acts as a securities depository and the use of which the
Fund has previously approved by Special Instructions (as hereinafter
defined) (each of the foregoing being referred to in this Agreement as a
"Securities System"). Use of a Securities System shall be in accordance
with applicable Federal Reserve Board and SEC rules and regulations, if
any, and subject to the following provisions:
(A) The Custodian may deposit and/or maintain securities held hereunder
in a Securities System, provided that such securities are represented in an
account ("Account") of the Custodian in the Securities System which Account
shall not contain any assets of the Custodian other than assets held as a
fiduciary, custodian, or otherwise for customers.
(B) The books and records of the Custodian shall at all times identify
those securities belonging to each Portfolio which are maintained in a
Securities System.
(C) The Custodian shall pay for securities purchased for the account of a
Portfolio only upon (w) receipt of advice from the Securities System that
such securities have been transferred to the Account of the Custodian, and
(x) the making of an entry on the records of the Custodian to reflect such
payment and transfer for the account of such Portfolio. The Custodian
shall transfer securities sold for the account of a Portfolio only upon (y)
receipt of advice from the Securities System that payment for such
securities has been transferred to the Account of the Custodian, and (z)
the making of an entry on the records of the Custodian to reflect such
transfer and payment for the account of such Portfolio. Copies of all
advices from the Securities System relating to transfers of securities for
the account of a Portfolio shall identify such Portfolio, shall be
maintained for the Portfolio by the Custodian. The Custodian shall deliver
to the Fund on the next succeeding business day daily transaction reports
which shall include each day's transactions in the Securities System for
the account of each Portfolio. Such transaction reports shall be delivered
to the Fund or any agent designated by the Fund pursuant to Proper
Instructions, by computer or in such other manner as the Fund and Custodian
may agree in writing.
(D) The Custodian shall, if requested by the Fund pursuant to Proper
Instructions, provide the Fund with all reports obtained by the Custodian
or any Subcustodian with respect to a Securities System's accounting
system, internal accounting control and procedures for safeguarding
securities deposited in the Securities System.
(E) Upon receipt of Special Instructions, the Custodian shall terminate
the use of any Securities System (except the federal book-entry system) on
behalf of any Portfolio as promptly as practicable and shall take all
actions reasonably practicable to safeguard the securities of the
Portfolios maintained with such Securities System.
Section 2.23. Other Transfers. Upon receipt of Special Instructions, the
Custodian shall make such other dispositions of securities, funds or other
property of the Portfolios in a manner or for purposes other than as
expressly set forth in this Agreement, provided that the Special
Instructions relating to such disposition shall include a statement of the
purpose for which the delivery is to be made, the amount of funds and/or
securities to be delivered, and the name of the person or persons to whom
delivery is to be made, and shall otherwise comply with the provisions of
Sections 3.01 and 3.03 hereof.
Section 2.24. Establishment of Segregated Account. Upon receipt of
Proper Instructions, the Custodian shall establish and maintain on its
books a segregated account or accounts for and on behalf of a Portfolio,
into which account or accounts may be transferred cash and/or securities or
other assets of such Portfolio, including securities maintained by the
Custodian in a Securities System pursuant to Section 2.22 hereof, said
account or accounts to be maintained: (a) for the purposes set forth in
Sections 2.09, 2.10 and 2.11 hereof; (b) for the purposes of compliance by
the Fund with the procedures required by Investment Company Act Release No.
10666, or any subsequent release or releases of the SEC relating to the
maintenance of segregated accounts by registered investment companies; or
(c) for such other purposes as set forth, from time to time, in Special
Instructions.
Section 2.25. Custodian's Books and Records. The Custodian shall provide
any assistance reasonably requested by the Fund in the preparation of
reports to Fund shareholders and others, audits of accounts, and other
ministerial matters of like nature. The Custodian shall maintain complete
and accurate records with respect to securities and other assets held for
the accounts of the Portfolios as required by the rules and regulations of
the SEC applicable to investment companies registered under the 1940 Act,
including: (a) journals or other records of original entry containing a
detailed and itemized daily record of all receipts and deliveries of
securities (including certificate and transaction identification numbers,
if any), and all receipts and disbursements of cash; (b) ledgers or other
records reflecting (i) securities in transfer, (ii) securities in physical
possession, (iii) securities borrowed, loaned or collateralizing
obligations of the Portfolios, (iv) monies borrowed and monies loaned
(together with a record of the collateral therefor and substitutions of
such collateral), and (v) dividends and interest received; and (c)
cancelled checks and bank records related thereto. The Custodian shall
keep such other books and records of the Fund as the Fund shall reasonably
request. All such books and records maintained by the Custodian shall be
maintained in a form acceptable to the Fund and in compliance with the
rules and regulations of the SEC, including, but not limited to, books and
records required to be maintained by Section 31(a) of the 1940 Act and the
rules and regulations from time to time adopted thereunder. All books and
records maintained by the Custodian pursuant to this Agreement shall at all
times be the property of the Fund and shall be available during normal
business hours for inspection and use by the Fund and its agents,
including, without limitation, its independent certified public
accountants. Notwithstanding the preceding sentence, the Funds shall not
take any actions or cause the Custodian to take any actions which would
cause, either directly or indirectly, the Custodian to violate any
applicable laws, regulations or orders.
Section 2.26. Opinion of Fund's Independent Certified Public Accountants.
The Custodian shall take all reasonable action as the Fund may request to
obtain from year to year favorable opinions from the Fund's independent
certified public accountants with respect to the Custodian's activities
hereunder in connection with the preparation of the Fund's Form N-1A and
the Fund's Form N-SAR or other periodic reports to the SEC and with respect
to any other requirements of the SEC.
Section 2.27. Reports by Independent Certified Public Accountants. At
the request of the Fund, the Custodian shall deliver to the Fund a written
report prepared by the Custodian's independent certified public accountants
with respect to the services provided by the Custodian under this
Agreement, including, without limitation, the Custodian's accounting
system, internal accounting control and procedures for safeguarding cash,
securities and other assets, including cash, securities and other assets
deposited and/or maintained in a Securities System or with a Subcustodian.
Such report shall be of sufficient scope and in sufficient detail as may
reasonably be required by the Fund and as may reasonably be obtained by the
Custodian.
Section 2.28. Overdraft Facility. In the event that the Custodian is
directed by Proper Instructions to make any payment or transfer of funds on
behalf of a Portfolio for which there would be, at the close of business on
the date of such payment or transfer, insufficient funds held by the
Custodian on behalf of such Portfolio, the Custodian may, in its
discretion, provide an overdraft (an "Overdraft") to the Fund on behalf of
such Portfolio, in an amount sufficient to allow the completion of such
payment. Any Overdraft provided hereunder: (a) shall be payable on the
next Business Day, unless otherwise agreed by the Fund and the Custodian;
and (b) shall accrue interest from the date of the Overdraft to the date of
payment in full by the Fund on behalf of the applicable Portfolio at a rate
agreed upon in writing, from time to time, by the Custodian and the Fund.
The Custodian and the Fund acknowledge that the purpose of such Overdrafts
is to temporarily finance the purchase or sale of securities for prompt
delivery in accordance with the terms hereof, or to meet emergency expenses
not reasonably foreseeable by the Fund. The Custodian shall promptly
notify the Fund in writing (an "Overdraft Notice") of any Overdraft by
facsimile transmission or in such other manner as the Fund and the
Custodian may agree in writing. At the request of the Custodian, the Fund,
on behalf of a Portfolio, shall pledge, assign and grant to the Custodian a
security interest in certain specified securities of the Portfolio, as
security for Overdrafts provided to such Portfolio, under the terms and
conditions set forth in Appendix "C" attached hereto.
ARTICLE III
PROPER INSTRUCTIONS, SPECIAL INSTRUCTIONS
AND RELATED MATTERS
Section 3.01. Proper Instructions and Special Instructions.
(a) Proper Instructions. As used herein, the term "Proper Instructions"
shall mean: (i) a tested telex, a written (including, without limitation,
facsimile transmission) request, direction, instruction or certification
signed or initialed by or on behalf of the Fund by one or more Authorized
Persons (as hereinafter defined); (ii) a telephonic or other oral
communication by one or more Authorized Persons; or (iii) a communication
effected directly between an electro-mechanical or electronic device or
system (including, without limitation, computers) by or on behalf of the
Fund by one or more Authorized Persons; provided, however, that
communications of the types described in clauses (ii) and (iii) above
purporting to be given by an Authorized Person shall be considered Proper
Instructions only if the Custodian reasonably believes such communications
to have been given by an Authorized Person with respect to the transaction
involved. Proper Instructions in the form of oral communications shall be
confirmed by the Fund by tested telex or in writing in the manner set forth
in clause (i) above, but the lack of such confirmation shall in no way
affect any action taken by the Custodian in reliance upon such oral
instructions prior to the Custodian's receipt of such confirmation. The
Fund and the Custodian are hereby authorized to record any and all
telephonic or other oral instructions communicated to the Custodian.
Proper Instructions may relate to specific transactions or to types or
classes of transactions, and may be in the form of standing instructions.
(b) Special Instructions. As used herein, the term "Special Instructions"
shall mean Proper Instructions countersigned or confirmed in writing by the
Treasurer or any Assistant Treasurer of the Fund or any other person
designated by the Treasurer of the Fund in writing, which countersignature
or confirmation shall be (i)included on the same instrument containing the
Proper Instructions or on a separate instrument relating thereto, and (ii)
delivered by hand, by facsimile transmission, or in such other manner as
the Fund and the Custodian agree in writing.
(c) Address for Proper Instructions and Special Instructions. Proper
Instructions and Special Instructions shall be delivered to the Custodian
at the address and/or telephone, telecopy or telex number agreed upon from
time to time by the Custodian and the Fund.
Section 3.02. Authorized Persons. Concurrently with the execution of
this Agreement and from time to time thereafter, as appropriate, the Fund
shall deliver to the Custodian, duly certified as appropriate by a
Treasurer or Assistant Treasurer of the Fund, a certificate setting forth:
(a) the names, titles, signatures and scope of authority of all persons
authorized to give Proper Instructions or any other notice, request,
direction, instruction, certificate or instrument on behalf of the Fund
(collectively, the "Authorized Persons" and individually, an "Authorized
Person"); and (b) the names, titles and signatures of those persons
authorized to issue Special Instructions. Such certificate may be accepted
and relied upon by the Custodian as conclusive evidence of the facts set
forth therein and shall be considered to be in full force and effect until
delivery to the Custodian of a similar certificate to the contrary. Upon
delivery of a certificate which deletes the name(s) of a person previously
authorized to give Proper Instructions or to issue Special Instructions,
such persons shall no longer be considered an Authorized Person or
authorized to issue Special Instructions.
Section 3.03. Persons Having Access to Assets of the Portfolios.
Notwithstanding anything to the contrary contained in this Agreement, no
Authorized Person, Trustee, officer, employee or agent of the Fund shall
have physical access to the assets of any Portfolio held by the Custodian
nor shall the Custodian deliver any assets of a Portfolio for delivery to
an account of such person; provided, however, that nothing in this Section
3.03 shall prohibit (a) any Authorized Person from giving Proper
Instructions, or any person authorized to issue Special Instructions from
issuing Special Instructions, so long as such action does not result in
delivery of or access to assets of any Portfolio prohibited by this Section
3.03; or (b) the Fund's independent certified public accountants from
examining or reviewing the assets of the Portfolios held by the Custodian.
The Fund shall deliver to the Custodian a written certificate identifying
such Authorized Persons, Trustees, officers, employees and agents of the
Fund.
Section 3.04. Actions of Custodian Based on Proper Instructions and
Special Instructions. So long as and to the extent that the Custodian acts
in accordance with (a) Proper Instructions or Special Instructions, as the
case may be, and (b) the terms of this Agreement, the Custodian shall not
be responsible for the title, validity or genuineness of any property, or
evidence of title thereof, received by it or delivered by it pursuant to
this Agreement.
ARTICLE IV
SUBCUSTODIANS
The Custodian may, from time to time, in accordance with the relevant
provisions of this Article IV, appoint one or more Domestic Subcustodians,
Foreign Subcustodians, Interim Subcustodians and Special Subcustodians to
act on behalf of a Portfolio. (For purposes of this Agreement, all duly
appointed Domestic Subcustodians, Foreign Subcustodians, Interim
Subcustodians, and Special Subcustodians are hereinafter referred to
collectively, as "Subcustodians.")
Section 4.01. Domestic Subcustodians. The Custodian may, at any time and
from time to time, appoint any bank as defined in Section 2(a)(5) of the
1940 Act meeting the requirements of a custodian under Section 17(f) of the
1940 Act and the rules and regulations thereunder, to act on behalf of one
or more Portfolios as a subcustodian for purposes of holding cash,
securities and other assets of such Portfolios and performing other
functions of the Custodian within the United States (a "Domestic
Subcustodian"); provided, that, the Custodian shall notify the Fund in
writing of the identity and qualifications of any proposed Domestic
Subcustodian at least thirty (30) days prior to appointment of such
Domestic Subcustodian, and the Fund may, in its sole discretion, by written
notice to the Custodian executed by an Authorized Person disapprove of the
appointment of such Domestic Subcustodian. If following notice by the
Custodian to the Fund regarding appointment of a Domestic Subcustodian and
the expiration of thirty (30) days after the date of such notice, the Fund
shall have failed to notify the Custodian of its disapproval thereof, the
Custodian may, in its discretion, appoint such proposed Domestic
Subcustodian as its subcustodian.
Section 4.02. Foreign Subcustodians and Interim Subcustodians.
(a) Foreign Subcustodians. The Custodian may, at any time and from time
to time, appoint: (i) any bank, trust company or other entity meeting the
requirements of an "eligible foreign custodian" under Section 17(f) of the
1940 Act and the rules and regulations thereunder or by order of the
Securities and Exchange Commission exempted therefrom, or (ii) any bank as
defined in Section 2(a)(5) of the 1940 Act meeting the requirements of a
custodian under Section 17(f) of the 1940 Act and the rules and regulations
thereunder to act on behalf of one or more Portfolios as a subcustodian for
purposes of holding cash, securities and other assets of such Portfolios
and performing other functions of the Custodian in countries other than the
United States of America (a "Foreign Subcustodian"); provided, that, prior
to the appointment of any Foreign Subcustodian, the Custodian shall have
obtained written confirmation of the approval of the Board of Trustees or
other governing body or entity of the Fund on behalf of the applicable
Portfolio(s) (which approval may be withheld in the sole discretion of such
Board of Trustees or other governing body or entity) with respect to (i)
the identity and qualifications of any proposed Foreign Subcustodian, (ii)
the country or countries in which, and the securities depositories or
clearing agencies, if any, through which, any proposed Foreign Subcustodian
is authorized to hold securities and other assets of the Portfolio(s), and
(iii) the form and terms of the subcustodian agreement to be entered into
between such proposed Foreign Subcustodian and the Custodian. Each such
duly approved Foreign Subcustodian and the countries where and the
securities depositories and clearing agencies through which they may hold
securities and other assets of the Funds shall be listed on Appendix "B"
attached hereto, as it may be amended, from time to time, in accordance
with the provisions of Section 9.05(c) hereof. The Fund shall be
responsible for informing the Custodian sufficiently in advance of a
proposed investment which is to be held in a country in which no Foreign
Subcustodian is authorized to act, in order that there shall be sufficient
time for the Custodian to effect the appropriate arrangements with a
proposed foreign subcustodian, including obtaining approval as provided in
this Section 4.02(a). The Custodian shall not amend any subcustodian
agreement entered into with a Foreign Subcustodian, or agree to change or
permit any changes thereunder, or waive any rights under such agreement,
which materially affect the Fund's rights or the Foreign Subcustodian's
obligations or duties to the Fund under such agreement, except upon prior
approval pursuant to Special Instructions.
(b) Interim Subcustodians. Notwithstanding the foregoing, in the event
that a Portfolio shall invest in a security or other asset to be held in a
country in which no Foreign Subcustodian is authorized to act, the
Custodian shall promptly notify the Fund in writing by facsimile
transmission or in such other manner as the Fund and Custodian shall agree
in writing of the unavailability of an approved Foreign Subcustodian in
such country; and the Custodian shall, upon receipt of Special
Instructions, appoint any Person designated by the Fund in such Special
Instructions to hold such security or other asset. (Any Person appointed
as a subcustodian pursuant to this Section 4.02(b) is hereinafter referred
to as an "Interim Subcustodian.")
Section 4.03. Special Subcustodians. Upon receipt of Special
Instructions, the Custodian shall, on behalf of the Fund for one or more
Portfolios, appoint one or more banks, trust companies or other entities
designated in such Special Instructions to act as a subcustodian for
purposes of: (i) effecting third-party repurchase transactions with banks,
brokers, dealers or other entities through the use of a common custodian or
subcustodian; (ii) establishing a joint trading account for the Portfolios
and other registered open-end management investment companies for which
Fidelity Management & Research Company serves as investment adviser,
through which the Portfolios and such other investment companies shall
collectively participate in certain repurchase transactions; (iii)
providing depository and clearing agency services with respect to certain
variable rate demand note securities; and (iv) effecting any other
transactions designated by the Fund in Special Instructions. (Each such
designated subcustodian is hereinafter referred to as a "Special
Subcustodian.") Each such duly appointed Special Subcustodian shall be
listed on Appendix "B" attached hereto, as it may be amended from time to
time in accordance with the provisions of Section 9.05(c) hereof. In
connection with the appointment of any Special Subcustodian, the Custodian
shall enter into a subcustodian agreement with the Special Subcustodian in
form and substance approved by the Fund, provided that such agreement shall
in all events comply with the provisions of the 1940 Act and the rules and
regulations thereunder and the terms and provisions of this Agreement. The
Custodian shall not amend any subcustodian agreement entered into with a
Special Subcustodian, or agree to change or permit any changes thereunder,
or waive any rights under such agreement, except upon prior approval
pursuant to Special Instructions.
Section 4.04. Termination of a Subcustodian. The Custodian shall (i)
cause each Domestic Subcustodian and Foreign Subcustodian to, and (ii) use
its best efforts to cause each Interim Subcustodian and Special
Subcustodian to, perform all of its obligations in accordance with the
terms and conditions of the subcustodian agreement between the Custodian
and such Subcustodian. In the event that the Custodian is unable to cause
such Subcustodian to fully perform its obligations thereunder, the
Custodian shall forthwith, upon the receipt of Special Instructions,
terminate such Subcustodian with respect to the Fund and, if necessary or
desirable, appoint a replacement Subcustodian in accordance with the
provisions of Section 4.01 or Section 4.02, as the case may be. In
addition to the foregoing, the Custodian (A) may, at any time in its
discretion, upon written notification to the Fund, terminate any Domestic
Subcustodian, Foreign Subcustodian or Interim Subcustodian, and (B) shall,
upon receipt of Special Instructions, terminate any Subcustodian with
respect to the Fund, in accordance with the termination provisions under
the applicable subcustodian agreement.
Section 4.05. Certification Regarding Foreign Subcustodians. Upon
request of the Fund, the Custodian shall deliver to the Fund a certificate
stating: (i) the identity of each Foreign Subcustodian then acting on
behalf of the Custodian; (ii) the countries in which and the securities
depositories and clearing agents through which each such Foreign
Subcustodian is then holding cash, securities and other assets of any
Portfolio; and (iii) such other information as may be requested by the Fund
to ensure compliance with Rule 17(f)-5 under the 1940 Act.
ARTICLE V
STANDARD OF CARE; INDEMNIFICATION
Section 5.01. Standard of Care.
(a) General Standard of Care. The Custodian shall exercise reasonable
care and diligence in carrying out all of its duties and obligations under
this Agreement, and shall be liable to the Fund for all loss, damage and
expense suffered or incurred by the Fund or the Portfolios resulting from
the failure of the Custodian to exercise such reasonable care and
diligence.
(b) Actions Prohibited by Applicable Law, Etc. In no event shall the
Custodian incur liability hereunder if the Custodian or any Subcustodian or
Securities System, or any subcustodian, securities depository or securities
system utilized by any such Subcustodian, or any nominee of the Custodian
or any Subcustodian (individually, a "Person") is prevented, forbidden or
delayed from performing, or omits to perform, any act or thing which this
Agreement provides shall be performed or omitted to be performed, by reason
of: (i) any provision of any present or future law or regulation or order
of the United States of America, or any state thereof, or of any foreign
country, or political subdivision thereof or of any court of competent
jurisdiction; or (ii) any act of God or war or other similar circumstance
beyond the control of the Custodian, unless, in each case, such delay or
nonperformance is caused by (A) the negligence, misfeasance or misconduct
of the applicable Person, or (B) a malfunction or failure of equipment
operated or utilized by the applicable Person other than a malfunction or
failure beyond such Person's control and which could not reasonably be
anticipated and/or prevented by such Person.
(c) Mitigation by Custodian. Upon the occurrence of any event which
causes or may cause any loss, damage or expense to the Fund or any
Portfolio, (i) the Custodian shall, (ii) the Custodian shall cause any
applicable Domestic Subcustodian or Foreign Subcustodian to, and (iii) the
Custodian shall use its best efforts to cause any applicable Interim
Subcustodian or Special Subcustodian to, use all commercially reasonable
efforts and take all reasonable steps under the circumstances to mitigate
the effects of such event and to avoid continuing harm to the Fund and the
Portfolios.
(d) Advice of Counsel. The Custodian shall be entitled to receive and act
upon advice of counsel on all matters. The Custodian shall be without
liability for any action reasonably taken or omitted in good faith pursuant
to the advice of (i) counsel for the Fund, or (ii) at the expense of the
Custodian, such other counsel as the Fund and the Custodian may agree upon;
provided, however, with respect to the performance of any action or
omission of any action upon such advice, the Custodian shall be required to
conform to the standard of care set forth in Section 5.01(a).
(e) Expenses of the Fund. In addition to the liability of the Custodian
under this Article V, the Custodian shall be liable to the Fund for all
reasonable costs and expenses incurred by the Fund in connection with any
claim by the Fund against the Custodian arising from the obligations of the
Custodian hereunder including, without limitation, all reasonable
attorneys' fees and expenses incurred by the Fund in asserting any such
claim, and all expenses incurred by the Fund in connection with any
investigations, lawsuits or proceedings relating to such claim; provided,
that the Fund has recovered from the Custodian for such claim.
(f) Liability for Past Records. The Custodian shall have no liability in
respect of any loss, damage or expense suffered by the Fund, insofar as
such loss, damage or expense arises from the performance of the Custodian's
duties hereunder by reason of the Custodian's reliance upon records that
were maintained for the Fund by entities other than the Custodian prior to
the Custodian's employment hereunder.
Section 5.02. Liability of Custodian for Actions of Other Persons.
(a) Domestic Subcustodians and Foreign Subcustodians. The Custodian shall
be liable for the actions or omissions of any Domestic Subcustodian or any
Foreign Subcustodian to the same extent as if such action or omission were
performed by the Custodian itself. In the event of any loss, damage or
expense suffered or incurred by the Fund caused by or resulting from the
actions or omissions of any Domestic Subcustodian or Foreign Subcustodian
for which the Custodian would otherwise be liable, the Custodian shall
promptly reimburse the Fund in the amount of any such loss, damage or
expense.
(b) Interim Subcustodians. Notwithstanding the provisions of Section 5.01
to the contrary, the Custodian shall not be liable to the Fund for any
loss, damage or expense suffered or incurred by the Fund or any Portfolio
resulting from the actions or omissions of an Interim Subcustodian unless
such loss, damage or expense is caused by, or results from, the negligence,
misfeasance or misconduct of the Custodian; provided, however, in the event
of any such loss, damage or expense, the Custodian shall take all
reasonable steps to enforce such rights as it may have against such Interim
Subcustodian to protect the interests of the Fund and the Portfolios.
(c) Special Subcustodians. Notwithstanding the provisions of Section 5.01
to the contrary and except as otherwise provided in any subcustodian
agreement to which the Custodian, the Fund and any Special Subcustodian are
parties, the Custodian shall not be liable to the Fund for any loss, damage
or expense suffered or incurred by the Fund or any Portfolio resulting from
the actions or omissions of a Special Subcustodian, unless such loss,
damage or expense is caused by, or results from, the negligence,
misfeasance or misconduct of the Custodian; provided, however, that in the
event of any such loss, damage or expense, the Custodian shall take all
reasonable steps to enforce such rights as it may have against any Special
Subcustodian to protect the interests of the Fund and the Portfolios.
(d) Securities Systems. Notwithstanding the provisions of Section 5.01 to
the contrary, the Custodian shall not be liable to the Fund for any loss,
damage or expense suffered or incurred by the Fund or any Portfolio
resulting from the use by the Custodian of a Securities System, unless such
loss, damage or expense is caused by, or results from, the negligence,
misfeasance or misconduct of the Custodian; provided, however, that in the
event of any such loss, damage or expense, the Custodian shall take all
reasonable steps to enforce such rights as it may have against the
Securities System to protect the interests of the Fund and the Portfolios.
(e) Reimbursement of Expenses. The Fund agrees to reimburse the Custodian
for all reasonable out-of-pocket expenses incurred by the Custodian in
connection with the fulfillment of its obligations under this Section 5.02;
provided, however, that such reimbursement shall not apply to expenses
occasioned by or resulting from the negligence, misfeasance or misconduct
of the Custodian.
Section 5.03. Indemnification.
(a) Indemnification Obligations. Subject to the limitations set forth in
this Agreement, the Fund agrees to indemnify and hold harmless the
Custodian and its nominees from all loss, damage and expense (including
reasonable attorneys' fees) suffered or incurred by the Custodian or its
nominee caused by or arising from actions taken by the Custodian in the
performance of its duties and obligations under this Agreement; provided,
however, that such indemnity shall not apply to loss, damage and expense
occasioned by or resulting from the negligence, misfeasance or misconduct
of the Custodian or its nominee. In addition, the Fund agrees to indemnify
any Person against any liability incurred by reason of taxes assessed to
such Person, or other loss, damage or expenses incurred by such Person,
resulting from the fact that securities and other property of the
Portfolios are registered in the name of such Person; provided, however,
that in no event shall such indemnification be applicable to income,
franchise or similar taxes which may be imposed or assessed against any
Person.
(b) Notice of Litigation, Right to Prosecute, Etc. The Fund shall not be
liable for indemnification under this Section 5.03 unless a Person shall
have promptly notified the Fund in writing of the commencement of any
litigation or proceeding brought against such Person in respect of which
indemnity may be sought under this Section 5.03. With respect to claims in
such litigation or proceedings for which indemnity by the Fund may be
sought and subject to applicable law and the ruling of any court of
competent jurisdiction, the Fund shall be entitled to participate in any
such litigation or proceeding and, after written notice from the Fund to
any Person, the Fund may assume the defense of such litigation or
proceeding with counsel of its choice at its own expense in respect of that
portion of the litigation for which the Fund may be subject to an
indemnification obligation; provided, however, a Person shall be entitled
to participate in (but not control) at its own cost and expense, the
defense of any such litigation or proceeding if the Fund has not
acknowledged in writing its obligation to indemnify the Person with respect
to such litigation or proceeding. If the Fund is not permitted to
participate or control such litigation or proceeding under applicable law
or by a ruling of a court of competent jurisdiction, such Person shall
reasonably prosecute such litigation or proceeding. A Person shall not
consent to the entry of any judgment or enter into any settlement in any
such litigation or proceeding without providing the Fund with adequate
notice of any such settlement or judgment, and without the Fund's prior
written consent. All Persons shall submit written evidence to the Fund
with respect to any cost or expense for which they are seeking
indemnification in such form and detail as the Fund may reasonably request.
Section 5.04. Investment Limitations. If the Custodian has otherwise
complied with the terms and conditions of this Agreement in performing its
duties generally, and more particularly in connection with the purchase,
sale or exchange of securities made by or for a Portfolio, the Custodian
shall not be liable to the Fund and the Fund agrees to indemnify the
Custodian and its nominees, for any loss, damage or expense suffered or
incurred by the Custodian and its nominees arising out of any violation of
any investment or other limitation to which the Fund is subject.
Section 5.05. Fund's Right to Proceed. Notwithstanding anything to the
contrary contained herein, the Fund shall have, at its election upon
reasonable notice to the Custodian, the right to enforce, to the extent
permitted by any applicable agreement and applicable law, the Custodian's
rights against any Subcustodian, Securities System, or other Person for
loss, damage or expense caused the Fund by such Subcustodian, Securities
System, or other Person, and shall be entitled to enforce the rights of the
Custodian with respect to any claim against such Subcustodian, Securities
System or other Person, which the Custodian may have as a consequence of
any such loss, damage or expense, if and to the extent that the Fund has
not been made whole for any such loss or damage. If the Custodian makes
the Fund whole for any such loss or damage, the Custodian shall retain the
ability to enforce its rights directly against such Subcustodian,
Securities System or other Person. Upon the Fund's election to enforce any
rights of the Custodian under this Section 5.05, the Fund shall reasonably
prosecute all actions and proceedings directly relating to the rights of
the Custodian in respect of the loss, damage or expense incurred by the
Fund; provided that, so long as the Fund has acknowledged in writing its
obligation to indemnify the Custodian under Section 5.03 hereof with
respect to such claim, the Fund shall retain the right to settle,
compromise and/or terminate any action or proceeding in respect of the
loss, damage or expense incurred by the Fund without the Custodian's
consent and provided further, that if the Fund has not made an
acknowledgement of its obligation to indemnify, the Fund shall not settle,
compromise or terminate any such action or proceeding without the written
consent of the Custodian, which consent shall not be unreasonably withheld
or delayed. The Custodian agrees to cooperate with the Fund and take all
actions reasonably requested by the Fund in connection with the Fund's
enforcement of any rights of the Custodian. The Fund agrees to reimburse
the Custodian for all reasonable out-of-pocket expenses incurred by the
Custodian in connection with the fulfillment of its obligations under this
Section 5.05; provided, however, that such reimbursement shall not apply to
expenses occasioned by or resulting from the negligence, misfeasance or
misconduct of the Custodian.
ARTICLE VI
COMPENSATION
On behalf of each Portfolio, the Fund shall compensate the Custodian in an
amount, and at such times, as may be agreed upon in writing, from time to
time, by the Custodian and the Fund.
ARTICLE VII
TERMINATION
Section 7.01. Termination of Agreement in Full. This Agreement shall
continue in full force and effect until the first to occur of: (a)
termination by the Custodian by an instrument in writing delivered or
mailed to the Fund, such termination to take effect not sooner than ninety
(90) days after the date of such delivery; (b) termination by the Fund by
an instrument in writing delivered or mailed to the Custodian, such
termination to take effect not sooner than thirty (30) days after the date
of such delivery; or (c) termination by the Fund by written notice
delivered to the Custodian, based upon the Fund's determination that there
is a reasonable basis to conclude that the Custodian is insolvent or that
the financial condition of the Custodian is deteriorating in any material
respect, in which case termination shall take effect upon the Custodian's
receipt of such notice or at such later time as the Fund shall designate.
In the event of termination pursuant to this Section 7.01, the Fund shall
make payment of all accrued fees and unreimbursed expenses within a
reasonable time following termination and delivery of a statement to the
Fund setting forth such fees and expenses. The Fund shall identify in any
notice of termination a successor custodian to which the cash, securities
and other assets of the Portfolios shall, upon termination of this
Agreement, be delivered. In the event that no written notice designating a
successor custodian shall have been delivered to the Custodian on or before
the date when termination of this Agreement shall become effective, the
Custodian may deliver to a bank or trust company doing business in Boston,
Massachusetts, of its own selection, having an aggregate capital, surplus,
and undivided profits, as shown by its last published report, of not less
than $25,000,000, all securities and other assets held by the Custodian and
all instruments held by the Custodian relative thereto and all other
property held by it under this Agreement. Thereafter, such bank or trust
company shall be the successor of the Custodian under this Agreement. In
the event that securities and other assets remain in the possession of the
Custodian after the date of termination hereof owing to failure of the Fund
to appoint a successor custodian, the Custodian shall be entitled to
compensation for its services in accordance with the fee schedule most
recently in effect, for such period as the Custodian retains possession of
such securities and other assets, and the provisions of this Agreement
relating to the duties and obligations of the Custodian and the Fund shall
remain in full force and effect. In the event of the appointment of a
successor custodian, it is agreed that the cash, securities and other
property owned by the Fund and held by the Custodian, any Subcustodian or
nominee shall be delivered to the successor custodian; and the Custodian
agrees to cooperate with the Fund in the execution of documents and
performance of other actions necessary or desirable in order to substitute
the successor custodian for the Custodian under this Agreement.
Section 7.02. Termination as to One or More Portfolios. This Agreement
may be terminated as to one or more Portfolios (but less than all of the
Portfolios) by delivery of an amended Appendix "A" deleting such Portfolios
pursuant to Section 9.05(b) hereof, in which case termination as to such
deleted Portfolios shall take effect thirty (30) days after the date of
such delivery. The execution and delivery of an amended Appendix "A" which
deletes one or more Portfolios shall constitute a termination of this
Agreement only with respect to such deleted Portfolio(s), shall be governed
by the preceding provisions of Section 7.01 as to the identification of a
successor custodian and the delivery of cash, securities and other assets
of the Portfolio(s) so deleted, and shall not affect the obligations of the
Custodian and the Fund hereunder with respect to the other Portfolios set
forth in Appendix "A," as amended from time to time.
ARTICLE VIII
DEFINED TERMS
The following terms are defined in the following sections:
Term Section
Account 2.22
ADRs 2.06
Authorized Person(s) 3.02
Banking Institution 2.12(a)
Business Day Appendix "C"
Bank Accounts 2.21
Distribution Account 2.16
Domestic Subcustodian 4.01
Foreign Subcustodian 4.02(a)
Institutional Client 2.03
Interim Subcustodian 4.02(b)
Overdraft 2.28
Overdraft Notice 2.28
Person 5.01(b)
Portfolio Preamble
Procedural Agreement 2.10
Proper Instructions 3.01(a)
SEC 2.22
Securities System 2.22
Shares 2.16
Special Instructions 3.01(b)
Special Subcustodian 4.03
Subcustodian Article IV
1940 Act Preamble
ARTICLE IX
MISCELLANEOUS
Section 9.01. Execution of Documents, Etc.
(a) Actions by the Fund. Upon request, the Fund shall execute and
deliver to the Custodian such proxies, powers of attorney or other
instruments as may be reasonable and necessary or desirable in connection
with the performance by the Custodian or any Subcustodian of their
respective obligations under this Agreement or any applicable subcustodian
agreement, provided that the exercise by the Custodian or any Subcustodian
of any such rights shall in all events be in compliance with the terms of
this Agreement.
(b) Actions by Custodian. Upon receipt of Proper Instructions, the
Custodian shall execute and deliver to the Fund or to such other parties as
the Fund may designate in such Proper Instructions, all such documents,
instruments or agreements as may be reasonable and necessary or desirable
in order to effectuate any of the transactions contemplated hereby.
Section 9.02. Representative Capacity; Nonrecourse Obligations. A COPY
OF THE DECLARATION OF TRUST OF THE FUND IS ON FILE WITH THE SECRETARY OF
THE STATE OF THE FUND'S FORMATION, AND NOTICE IS HEREBY GIVEN THAT THIS
AGREEMENT IS NOT EXECUTED ON BEHALF OF THE TRUSTEES OF THE FUND AS
INDIVIDUALS, AND THE OBLIGATIONS OF THIS AGREEMENT ARE NOT BINDING UPON ANY
OF THE TRUSTEES, OFFICERS, SHAREHOLDERS OR PARTNERS OF THE FUND
INDIVIDUALLY, BUT ARE BINDING ONLY UPON THE ASSETS AND PROPERTY OF THE
PORTFOLIOS. THE CUSTODIAN AGREES THAT NO SHAREHOLDER, TRUSTEE, OFFICER OR
PARTNER OF THE FUND MAY BE HELD PERSONALLY LIABLE OR RESPONSIBLE FOR ANY
OBLIGATIONS OF THE FUND ARISING OUT OF THIS AGREEMENT.
Section 9.03. Several Obligations of the Portfolios. WITH RESPECT TO ANY
OBLIGATIONS OF THE FUND ON BEHALF OF THE PORTFOLIOS ARISING OUT OF THIS
AGREEMENT, INCLUDING, WITHOUT LIMITATION, THE OBLIGATIONS ARISING UNDER
SECTIONS 2.28, 5.03, 5.05 and ARTICLE VI HEREOF, THE CUSTODIAN SHALL LOOK
FOR PAYMENT OR SATISFACTION OF ANY OBLIGATION SOLELY TO THE ASSETS AND
PROPERTY OF THE PORTFOLIO TO WHICH SUCH OBLIGATION RELATES AS THOUGH THE
FUND HAD SEPARATELY CONTRACTED WITH THE CUSTODIAN BY SEPARATE WRITTEN
INSTRUMENT WITH RESPECT TO EACH PORTFOLIO.
Section 9.04. Representations and Warranties.
(a) Representations and Warranties of the Fund. The Fund hereby
represents and warrants that each of the following shall be true, correct
and complete at all times during the term of this Agreement: (i) the Fund
is duly organized under the laws of its jurisdiction of organization and is
registered as an open-end management investment company under the 1940 Act;
and (ii) the execution, delivery and performance by the Fund of this
Agreement are (w) within its power, (x) have been duly authorized by all
necessary action, and (y) will not (A) contribute to or result in a breach
of or default under or conflict with any existing law, order, regulation or
ruling of any governmental or regulatory agency or authority, or (B)
violate any provision of the Fund's corporate charter, Declaration of Trust
or other organizational document, or bylaws, or any amendment thereof or
any provision of its most recent Prospectus or Statement of Additional
Information.
(b) Representations and Warranties of the Custodian. The Custodian
hereby represents and warrants that each of the following shall be true,
correct and complete at all times during the term of this Agreement: (i)
the Custodian is duly organized under the laws of its jurisdiction of
organization and qualifies to act as a custodian to open-end management
investment companies under the provisions of the 1940 Act; and (ii) the
execution, delivery and performance by the Custodian of this Agreement are
(w) within its power, (x) have been duly authorized by all necessary
action, and (y) will not (A) contribute to or result in a breach of or
default under or conflict with any existing law, order, regulation or
ruling of any governmental or regulatory agency or authority, or (B)
violate any provision of the Custodian's corporate charter, or other
organizational document, or bylaws, or any amendment thereof.
Section 9.05. Entire Agreement. This Agreement constitutes the entire
understanding and agreement of the parties hereto with respect to the
subject matter hereof and accordingly, supersedes as of the effective date
of this Agreement any custodian agreement heretofore in effect between the
Fund and the Custodian.
Section 9.06. Waivers and Amendments. No provision of this Agreement may
be waived, amended or terminated except by a statement in writing signed by
the party against which enforcement of such waiver, amendment or
termination is sought; provided, however: (a) Appendix "A" listing the
Portfolios for which the Custodian serves as custodian may be amended from
time to time to add one or more Portfolios, by the Fund's execution and
delivery to the Custodian of an amended Appendix "A", and the execution of
such amended Appendix by the Custodian, in which case such amendment shall
take effect immediately upon execution by the Custodian; (b) Appendix "A"
may be amended from time to time to delete one or more Portfolios (but less
than all of the Portfolios), by the Fund's execution and delivery to the
Custodian of an amended Appendix A", in which case such amendment shall
take effect thirty (30) days after such delivery, unless otherwise agreed
by the Custodian and the Fund in writing; (c) Appendix "B" listing Foreign
Subcustodians and Special Subcustodians approved by the Fund may be amended
from time to time to add or delete one or more Foreign Subcustodians or
Special Subcustodians by the Fund's execution and delivery to the Custodian
of an amended Appendix "B", in which case such amendment shall take effect
immediately upon execution by the Custodian; and (d) Appendix "C" setting
forth the procedures relating to the Custodian's security interest may be
amended only by an instrument in writing executed by the Fund and the
Custodian.
Section 9.07. Interpretation. In connection with the operation of this
Agreement, the Custodian and the Fund may agree in writing from time to
time on such provisions interpretative of or in addition to the provisions
of this Agreement as may in their joint opinion be consistent with the
general tenor of this Agreement. No interpretative or additional
provisions made as provided in the preceding sentence shall be deemed to be
an amendment of this Agreement.
Section 9.08. Captions. Headings contained in this Agreement, which are
included as convenient references only, shall have no bearing upon the
interpretation of the terms of the Agreement or the obligations of the
parties hereto.
Section 9.09. Governing Law. Insofar as any question or dispute may
arise in connection with the custodianship of foreign securities pursuant
to an agreement with a Foreign Subcustodian that is governed by the laws of
the State of New York, the provisions of this Agreement shall be construed
in accordance with and governed by the laws of the State of New York,
provided that in all other instances this Agreement shall be construed in
accordance with and governed by the laws of the Commonwealth of
Massachusetts, in each case without giving effect to principles of
conflicts of law.
Section 9.10. Notices. Except in the case of Proper Instructions or
Special Instructions, notices and other writings contemplated by this
Agreement shall be delivered by hand or by facsimile transmission (provided
that in the case of delivery by facsimile transmission, notice shall also
be mailed postage prepaid to the parties at the following addresses:
(a) If to the Fund:
c/o Fidelity Management & Research Company
82 Devonshire Street
Boston, Massachusetts 02109
Attn: John E. Ferris
Telephone: (617) 570-6556
Telefax: (617) 742-1231
(b) If to the Custodian:
60 Wall Street - 37th Floor
New York, New York 10260-0060
Attn: Stella V. Milano, Vice President
Telephone: (212) 648-3194
Telefax: (212) 837-5113
or to such other address as either party may have designated in writing to
the other party hereto.
Section 9.11. Assignment. This Agreement shall be binding on and shall
inure to the benefit of the Fund and the Custodian and their respective
successors and assigns, provided that, subject to the provisions of Section
7.01 hereof, neither party hereto may assign this Agreement or any of its
rights or obligations hereunder without the prior written consent of the
other party.
Section 9.12. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original. This Agreement
shall become effective when one or more counterparts have been signed and
delivered by each of the parties.
Section 9.13. Confidentiality; Survival of Obligations. The parties
hereto agree that each shall treat confidentially the terms and conditions
of this Agreement and all information provided by each party to the other
regarding its business and operations. All confidential information
provided by a party hereto shall be used by any other party hereto solely
for the purpose of rendering services pursuant to this Agreement and,
except as may be required in carrying out this Agreement, shall not be
disclosed to any third party without the prior consent of such providing
party. The foregoing shall not be applicable to any information that is
publicly available when provided or thereafter becomes publicly available
other than through a breach of this Agreement, or that is required to be
disclosed by any bank examiner of the Custodian or any Subcustodian, any
auditor of the parties hereto, by judicial or administrative process or
otherwise by applicable law or regulation. The provisions of this Section
9.13 and Sections 9.01, 9.02, 9.03, 9.09, Section 2.28, Section 3.04,
Section 7.01, Article V and Article VI hereof and any other rights or
obligations incurred or accrued by any party hereto prior to termination of
this Agreement shall survive any termination of this Agreement.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed in its name and behalf on the day and year first above written.
FIDELITY MONEY MARKET TRUST MORGAN GUARANTY TRUST
COMPANY OF NEW YORK
By: /s/John E. Ferris By: /s/Stella Milano
Name: John E. Ferris Name: Stella Milano
Title: Treasurer Title: Vice President
APPENDIX "A"
TO
CUSTODIAN AGREEMENT
BETWEEN
Fidelity Money Market Trust
and
Morgan Guaranty Trust Company of New York
Dated as of January 16, 1992
The following is a list of Portfolios for which the Custodian shall serve
under a Custodian Agreement dated as of July 18, 1991 (the "Agreement"):
Portfolio Name Effective as of:
Domestic Money Market Portfolio January 10, 1992
Retirement Government Money Market February 7, 1992
Portfolio
Retirement Money Market Portfolio February 7, 1992
U.S. Government Portfolio January 10, 1992
U.S. Treasury Portfolio January 10, 1992
IN WITNESS WHEREOF, each of the parties hereto has caused this Appendix to
be executed in its name and behalf as of the day and year first set forth
opposite each such Portfolio.
Fidelity Money Market Trust Morgan Guaranty Trust
Company of New York
By: By:
Name: Gary L. French Name: Stella Milano
Title: Treasurer Title: Vice President
APPENDIX "C" TO THE
CUSTODIAN AGREEMENT BETWEEN
Fidelity Money Market Trust and Morgan Guaranty Trust Company of New York
Dated as of July 18, 1991
PROCEDURES RELATING TO CUSTODIAN'S SECURITY INTEREST
As security for any Overdrafts (as defined in the Custodian Agreement) of
any Portfolio, the Fund, on behalf of such Portfolio, shall pledge, assign
and grant to the Custodian a security interest in Collateral (as
hereinafter defined), under the terms, circumstances and conditions set
forth in this Appendix "C".
Section 1. Defined Terms. As used in this Appendix "C" the following
terms shall have the following respective meanings:
(a) "Business Day" shall mean any day that is not a Saturday, a Sunday or
a day on which the Custodian is closed for business.
(b) "Collateral" shall mean, with respect to any Portfolio, the securities
having a fair market value (as determined in accordance with the procedures
set forth in the prospectus for the Portfolio) equal to the aggregate of
all Overdraft Obligations of such Portfolio: (i) identified in any Pledge
Certificate executed on behalf of such Portfolio; or (ii) designated by the
Custodian for such Portfolio pursuant to Section 3 of this Appendix C.
Such securities shall consist of marketable securities held by the
Custodian on behalf of such Portfolio or, if no such marketable securities
are held by the Custodian on behalf of such Portfolio, such other
securities designated by the Fund in the applicable Pledge Certificate or
by the Custodian pursuant to Section 3 of this Appendix C.
(c) "Overdraft Obligations" shall mean, with respect to any Portfolio, the
amount of any outstanding Overdraft(s) provided by the Custodian to such
Portfolio together with all accrued interest thereon.
(d) "Pledge Certificate" shall mean a Pledge Certificate in the form
attached to this Appendix "C" as Schedule 1 executed by a duly authorized
officer of the Fund and delivered by the Fund to the Custodian by facsimile
transmission or in such other manner as the Fund and the Custodian may
agree in writing.
(e) "Release Certificate" shall mean a Release Certificate in the form
attached to this Appendix "C" as Schedule 2 executed by a duly authorized
officer of the Custodian and delivered by the Custodian to the Fund by
facsimile transmission or in such other manner as the Fund and the
Custodian may agree in writing.
(f) "Written Notice" shall mean a written notice executed by a duly
authorized officer of the party delivering the notice and delivered by
facsimile transmission or in such other manner as the Fund and the
Custodian shall agree in writing.
Section 2. Pledge of Collateral. To the extent that any Overdraft
Obligations of any Portfolio are not satisfied within one (1) Business Day
after receipt by the Fund of a Written Notice requesting security for such
Overdraft Obligation and stating the amount of such Overdraft Obligation,
the Fund, on behalf of such Portfolio, shall pledge, assign and grant to
the Custodian a first priority security interest, by delivering to the
Custodian, a Pledge Certificate executed by the Fund on behalf of such
Portfolio describing the applicable Collateral. Such Written Notice may,
in the discretion of the Custodian, be included within or accompany the
Overdraft Notice relating to the applicable Overdraft Obligations.
Section 3. Failure to Pledge Collateral. In the event that the Fund
shall fail: (a) to pay, on behalf of the applicable Portfolio, the
Overdraft Obligation described in such Written Notice; (b) to deliver to
the Custodian a Pledge Certificate pursuant to Section 2; or (c) to
identify substitute securities pursuant to Section 6 upon the sale or
maturity of any securities identified as Collateral, the Custodian may, by
Written Notice to the Fund specify Collateral which shall secure the
applicable Overdraft Obligation. The Fund, on behalf of any applicable
Portfolio, hereby pledges, assigns and grants to the Custodian a first
priority security interest in any and all Collateral specified in such
Written Notice; provided that such pledge, assignment and grant of security
shall be deemed to be effective only upon receipt by the Fund of such
Written Notice.
Section 4. Delivery of Additional Collateral. If at any time the
Custodian shall notify the Fund by Written Notice that the fair market
value of the Collateral securing any Overdraft Obligation is less than the
amount of such Overdraft Obligation, the Fund, on behalf of the applicable
Portfolio, shall deliver to the Custodian, within one (1) Business Day
following the Fund's receipt of such Written Notice, an additional Pledge
Certificate describing additional Collateral. If the Fund shall fail to
deliver such additional Pledge Certificate, the Custodian may specify
Collateral which shall secure the unsecured amount of the applicable
Overdraft Obligation in accordance with Section 3 of this Appendix C.
Section 5. Release of Collateral. Upon payment by the Fund of any
Overdraft Obligation secured by the pledge of Collateral, the Custodian
shall promptly deliver to the Fund a Release Certificate pursuant to which
the Custodian shall release Collateral from the lien under the applicable
Pledge Certificate or Written Notice pursuant to Section 3 having a fair
market value equal to the amount paid by the Fund on account of such
Overdraft Obligation. In addition, if at any time the Fund shall notify
the Custodian by Written Notice that the Fund desires that specified
Collateral be released and: (a) that the fair market value of the
Collateral securing any Overdraft Obligation shall exceed the amount of
such Overdraft Obligation; or (b) that the Fund has delivered a Pledge
Certificate substituting Collateral for such Overdraft Obligation, the
Custodian shall deliver to the Fund, within one (1) Business Day following
the Custodian's receipt of such Written Notice, a Release Certificate
relating to the Collateral specified in such Written Notice.
Section 6. Substitution of Collateral. The Fund may substitute
securities for any securities identified as Collateral by delivery to the
Custodian of a Pledge Certificate executed by the Fund on behalf of the
applicable Portfolio, indicating the securities pledged as Collateral.
Section 7. Security for Individual Portfolios' Overdraft Obligations.
The pledge of Collateral by the Fund on behalf of any individual Portfolio
shall secure only the Overdraft Obligations of such Portfolio. In no event
shall the pledge of Collateral by one Portfolio be deemed or considered to
be security for the Overdraft Obligations of any other Portfolio.
Section 8. Custodian's Remedies. Upon (a) the Fund's failure to pay any
Overdraft Obligation of a Portfolio within thirty (30) days after receipt
by the Fund of a Written Notice demanding security therefore, and (b) one
(1) Business Day's prior Written Notice to the Fund, the Custodian may
elect to enforce its security interest in the Collateral securing such
Overdraft Obligation, by taking title to (at the then prevailing fair
market value), or selling in a commercially reasonable manner, so much of
the Collateral as shall be required to pay such Overdraft Obligation in
full. Notwithstanding the provisions of any applicable law, including,
without limitation, the Uniform Commercial Code, the remedy set forth in
the preceding sentence shall be the only right or remedy to which the
Custodian is entitled with respect to the pledge and security interest
granted pursuant to any Pledge Certificate or Section 3, without limiting
the foregoing, the Custodian hereby waives and relinquishes all contractual
and common law rights of set off to which it may now or hereafter be or
become entitled with respect to any obligations of the Fund to the
Custodian arising under this Appendix C to the Agreement.
IN WITNESS WHEREOF, each of the parties has caused this Appendix to be
executed in its name and behalf on the day and year first above written.
FIDELITY MONEY MARKET TRUST MORGAN GUARANTY TRUST
COMPANY OF NEW YORK
By: /s/John E. Ferris By: /s/Stella Milano
Name: John E. Ferris Name: Stella Milano
Title: Treasurer Title: Vice President
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference, into the Prospectus
and Statement of Additional Information in Post-Effective Amendment No. 46
to the Registration Statement on Form N-1A of FIDELITY MONEY MARKET TRUST,
of our report dated [DATE OF OPINION] on the financial statements and
financial highlights included in the August 31 Annual Report to
Shareholders of the TRUST.
We further consent to the references to our Firm under the headings
"Financial Highlights" in the Prospectus and "Auditor" in the Statement of
Additional Information.
/s/COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
December 29, 1994
TO BE USED IN A POST-EFFECTIVE AMENDMENT WHERE THERE ARE TWO OR MORE
PROSPECTUSES COVERING FUNDS IN THE SAME TRUST (E.G., DEVONSHIRE TRUST).
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference, into the Prospectuses
and Statements of Additional Information in Post-Effective Amendment No. [
] to the Registration Statement on Form N-1A of [TRUST NAME: FUND NAMES] of
our reports dated [DATE OF OPINION] on the financial statements and
financial highlights included in the [FISCAL YEAR END] Annual Reports to
Shareholders of [FUND NAMES].
We further consent to the references to our Firm under the headings
"Financial Highlights" in the Prospectuses and "Auditor" in the Statements
of Additional Information.
/s/COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
[DATE HANDING OFF 485(b) FOR FILING]
