<PAGE>
As filed with the Securities and Exchange Commission on June 21, 1995
Registration No. 33-________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. [ ] Post-Effective Amendment No. [ ]
Fidelity Institutional Cash Portfolios
--------------------------------------
(Exact Name of Registrant as Specified in Charter)
82 Devonshire St., Boston, MA 02109
---------------------------------------
(Address Of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code 617-563-7000
------------
Arthur S. Loring, Secretary, 82 Devonshire St., Boston, MA 02109
----------------------------------------------------------------
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering: As soon as practicable after
the Registration Statement becomes effective under the Securities Act of
1933.
The Registrant has registered an indefinite amount of securities under the
Securities Act of 1933 pursuant to Section 24(f) under the Investment
Company Act of 1940; accordingly, no fee is payable herewith because of
reliance upon Rule 24f-2. A Rule 24f-2 Notice for the Registrant's most
recent fiscal year ended March 31, 1995 was filed with the Commission on
May 18, 1995. Pursuant to Rule 429, this Registration Statement relates
to shares previously registered on Form N-1A.
It is proposed that this filing will become effective on July 21, 1995
pursuant to Rule 488.
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS
CONTENTS OF REGISTRATION STATEMENT
This Registration Statement contains the following papers and documents:
Facing Page
Contents of Registration Statement
Cross Reference Sheet
Letter to Shareholders
Form of Proxy Card
Notice of Special Meeting
Part A - Prospectus/Proxy Statement
Part B - Statement of Additional Information
Part C - Other Information
Signature Pages
Exhibits
<PAGE>
<TABLE>
<CAPTION>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS:
Form N-14 Cross Reference Sheet
Part A Item No. Prospectus/Proxy
and Caption Statement Caption
<S> <C> <C>
1. Beginning of Registration Statement and Outside Cover Page
Front Cover Page of Prospectus
2. Beginning and Outside Back Cover Page of Table of Contents
Prospectus
3. Fee Table; Synopsis Information and Risk Factors Synopsis; Comparison of Principal Risk Factors
4. Information About the Transaction Synopsis; The Proposals Appendix A
5. Information About the Registrant The Proposal; Synopsis; Comparison of Principal
Risk Factors; Miscellaneous; Additional
Information About FICP Government; Prospectus
and Statement of Additional Information of
Fidelity Institutional Cash Portfolios Class A
Shares
6. Information About the Company Being Acquired Synopsis; Comparison of Principal Risk Factors;
Miscellaneous; Prospectus of Fidelity Money
Market Trust
7. Voting Information Voting Information
8. Interest of Certain Persons and Experts Not Applicable
9. Additional Information Required for Reoffering Not Applicable
by Persons Deemed to be Underwriters
Part B Item No. Statement of Additional
and Caption Information Caption
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. Additional Information About the Registrant Prospectus and Statement of Additional
Information of Fidelity Institutional Cash
Portfolios Class A Shares
13. Additional Information About the Company Being Not applicable.
Acquired
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS:
Form N-14 Cross Reference Sheet
Part A Item No. Prospectus/Proxy
and Caption Statement Caption
14. Financial Statements Annual Report of Fidelity Money Market Trust
for Fiscal Year Ended August 31, 1994; Annual
Report of Fidelity Institutional Cash
Portfolios Class A Shares for Fiscal Year Ended
March 31, 1995
Semi-Annual Report of Fidelity Money Market
Trust for Period Ended February 28, 1995
</TABLE>
Part C
Information required to be included in Part C is set forth under
the appropriate item, so numbered, in Part C of this Registration
Statement.
<PAGE>
[Fund #]
Fidelity Money Market Trust: U.S. Government Portfolio
July 26, 1995
Dear Shareholder:
In September, Fidelity is holding a Special Meeting for shareholders of
Fidelity Money Market Trust: U.S. Government Portfolio (FMMT Government).
The purpose of the meeting is to consolidate FMMT Government with another
Fidelity institutional money market fund that has the same investment
objectives and policies as FMMT Government. After the combination,
institutional investors will continue to enjoy the benefits of a U.S.
Government money market fund, and will now have a 20 basis point expense
ratio, reduced from its current expense ratio of 42 basis points. The
combination will afford investors additional benefits of a larger
investment portfolio. The cost of the combination will be borne
exclusively by Fidelity. Accordingly, the Trustees recommend you approve
the combined transactions.
At this important meeting, shareholders are being asked to consider and
approve an Agreement and Plan of Reorganization (the Agreement) FMMT
Government and Fidelity Institutional Cash Portfolios: Government (FICP
Government) (the Reorganization). The terms of the proposed
Reorganization provide for the transfer of substantially all of the assets
of FMMT Government to FICP Government in exchange for Class A Shares of
FICP Government. Following such transfer, FMMT Government will be
liquidated and Class A Shares of FICP Government will be distributed to
shareholders of FMMT Government in exchange for their FMMT Government
shares. Each shareholder will receive the number and value of FICP
Government shares equal to the number and value of such shareholder's
shares in FMMT Government.
FICP Government, like FMMT Government, is a money market fund that seeks a
high level of current income by investing in securities issued by the U.S.
government and its agencies. Enclosed is a Proxy Statement further
describing the reasons for the Reorganization and a Prospectus describing
in detail the investment objective and policies of FICP Government.
Fidelity Management & Research Company, FMMT Government's adviser,
anticipates that approval of the Reorganization will result in lower fund
operating expenses. FMMT Government has received an opinion of counsel to
the effect that the Reorganization will qualify as a tax-free
reorganization under the Internal Revenue Code. The exchange of shares of
FMMT Government for Class A Shares of FICP Government therefore will not
result in the recognition of any taxable gain or loss to the shareholders
of FMMT Government on the date of the transaction.
<PAGE>
The Board of Trustees of Fidelity Money Market Trust has unanimously
approved the proposed Reorganization and recommends voting to approve the
Agreement. Approval of the Agreement requires the affirmative vote of a
majority of outstanding shares. Your participation is extremely important
no matter how many or how few shares you own. Once you have marked your
vote on the enclosed proxy card, be sure to sign and return it in the
enclosed postage-paid envelope. Call a Fidelity representative at 1-800-
843-3001 if you have any questions.
Sincerely,
Edward C. Johnson 3d
President
<PAGE>
Vote this proxy card TODAY! Your prompt response will
save the expense of additional mailings.
Return the proxy card in the enclosed envelope or mail to:
Fidelity Investments
Proxy Department
P.O. Box 9107
Hingham, MA 02043-9848
Please detach at perforation before mailing.
--------------------------------------------------------------------------
FIDELITY MONEY MARKET TRUST
U.S. Government Portfolio
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and ___________________, or any one or more
of them, attorneys, with full power of substitution, to vote all shares of
Fidelity Money Market Trust: U.S. Government Portfolio, as indicated above
which the undersigned is entitled to vote at the Special Meeting of
Shareholders of the fund to be held at the office of the trust at 82
Devonshire St., Boston, MA 02109, on September 13, 1995 at __:__
[a.m./p.m.] and at any adjournments thereof. All powers may be exercised
by a majority of said proxy holders or substitutes voting or acting or, if
only one votes and acts, then by that one. This Proxy shall be voted on
the proposals described in the Proxy Statement as specified on the reverse
side. Receipt of the Notice of the Meeting and the accompanying Proxy
Statement is hereby acknowledged.
NOTE: Please sign exactly as your name appears on this
Proxy. When signing in a fiduciary capacity, such as
executor, administrator, trustee, attorney, guardian, etc.,
please so indicate. Corporate and partnership proxies
should be signed by an authorized person indicating the
person's title.
Date ______________________________________, 1995
___________________________________________
___________________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
(Individual fund numbers followed by HH)
[combined maps product code-PXC [cusip #XXXXXXXXX three digit fund # H]
<PAGE>
Please refer to the Proxy Statement discussion of this matter.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE PROPOSAL.
As to any other matter, said attorneys shall vote in accordance with their
best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR THE FOLLOWING:
__________________________________________________________________________
==========================================================================
__________________________________________________________________________
1. To approve an FOR [ ] AGAINST [ ] ABSTAIN [ ] 1.
Agreement and Plan
of Reorganization
and Liquidation
whereby Government,
a series of
Fidelity Institu-
tional Cash Port-
folios, acquires
substantially all
of the assets and
liabilities of
U.S. Government
Portfolio, a series
of Fidelity Money
Market Trust,
solely in exchange
for Capital shares
of beneficial
interest of Govern-
ment.
==========================================================================
[combined maps product code-PXC-595] [cusip #XXXXXXX three digit fund # H]
<PAGE>
U.S. GOVERNMENT PORTFOLIO
(a series of Fidelity Money Market Trust)
82 Devonshire Street
Boston, Massachusetts 02109
____________________
NOTICE OF
SPECIAL MEETING OF SHAREHOLDERS
to be held
September 13, 1995
____________________
To The Shareholders:
A Special Meeting of Shareholders (the Meeting) of U.S.
Government Portfolio (FMMT Government), a series of Fidelity Money Market
Trust (Trust), will be held at the principal executive office of the Trust
at 82 Devonshire Street, Boston, Massachusetts, 02109 on September 13,
1995, at [__:__ a.m./p.m.]. The purpose of the Meeting is as follows:
(1) To approve an Agreement and Plan of Reorganization and
Liquidation between FMMT Government and Fidelity Institutional Cash
Portfolios: Government (FICP Government), providing for the transfer of
substantially all of the assets of FMMT Government to FICP Government in
exchange solely for Class A Shares of beneficial interest of FICP
Government and the distribution of Class A Shares of FICP Government to
shareholders of FMMT Government in liquidation of FMMT Government.
(2) To transact such other business as may properly come
before the Meeting or any adjournment thereof.
The Board of Trustees has fixed the close of business on July 17,
1995 as the record date for determination of shareholders entitled to
notice of and to vote at the Meeting and any adjournments thereof.
By order of the Board of Trustees,
ARTHUR S. LORING, Secretary
YOUR VOTE IS IMPORTANT -- PLEASE RETURN YOUR PROXY CARD PROMPTLY.
Shareholders are invited to attend the Meeting in person. Any
shareholder who does not expect to attend the Meeting is urged to indicate
voting instructions on the enclosed proxy card, date and sign it, and
return it in the envelope provided, which needs no postage if mailed in
the United States. In order to avoid unnecessary expense, we ask your
cooperation in mailing your proxy card promptly, no matter how large or
small your holdings may be.
<PAGE>
U.S. GOVERNMENT PORTFOLIO
(a series of Fidelity Money Market Trust)
GOVERNMENT
(a series of Fidelity Institutional Cash Portfolios)
82 Devonshire Street
Boston, Massachusetts, 02109
(Toll Free) 1-800-843-3001
_____________________
PROXY STATEMENT AND PROSPECTUS
____________, 1995
_____________________
This Proxy Statement and Prospectus (Proxy Statement) is being
furnished to shareholders of U.S. Government Portfolio (FMMT Government),
a series of Fidelity Money Market Trust (FMMT or a Trust), in connection
with the solicitation of proxies by the Trust's Board of Trustees for use
at a Special Meeting of Shareholders of FMMT Government and at any
adjournment thereof (the Meeting). The Meeting will be held on Wednesday,
September 13, 1995 at __:__ [a.m./p.m.] Eastern time at 82 Devonshire
Street, Boston, Massachusetts, 02109, the principal executive office of
the Trust.
As more fully described in the Proxy Statement, the purpose of
the Meeting is to vote on a proposed reorganization (Reorganization).
Pursuant to an Agreement and Plan of Reorganization and Liquidation (the
Agreement), FMMT Government would transfer substantially all of its assets
to Fidelity Institutional Cash Portfolios: Government (FICP Government) in
exchange solely for Class A Shares of beneficial interest of FICP
Government and the assumption by FICP Government of FMMT Government's
liabilities. FICP Government Class A Shares then would be distributed to
FMMT Government shareholders, so that each such shareholder would receive
a number of full and fractional shares of FICP Government equal to the
number of shares of FMMT Government Portfolio held by such shareholder.
Following the distribution, FMMT Government will have neither assets,
liabilities, nor shareholders, and it is expected that the Trust's Board
of Trustees will liquidate FMMT Government as soon as practical.
FICP Government, a money market fund, is a diversified portfolio
of the Fidelity Institutional Cash Portfolios (FICP or a Trust), an open-
end management investment company. FICP Government's investment objective
is to obtain as high a level of current income consistent with the
preservation of capital and liquidity. FICP Government seeks to achieve
its investment objective by investing in U.S. government obligations
issued or guaranteed as to principal and interest by the U.S. government,
including bills, notes, bonds, and other U.S. Treasury debt securities;
and instruments issued by U.S. government instrumentalities or agencies
(agency obligations).
This Proxy Statement, which should be retained for future
reference, sets forth concisely the information about the Reorganization
<PAGE>
and FICP Government that a shareholder should know before voting on the
Reorganization. This Proxy Statement is accompanied by the combined
Prospectus and Statement of Additional Information dated May 20, 1994,
which offers shares of FICP Government. The combined Prospectus and
Statement of Additional Information is incorporated herein by this
reference. A Prospectus and a Statement of Additional Information for
FMMT Government, both dated December 24, 1994, have been filed with the
SEC and are incorporated herein by this reference. Copies of these
documents may be obtained without charge and further inquiries may be made
by contacting Fidelity Distributors Corporation, 82 Devonshire Street,
Boston, Massachusetts, 02109 or by calling 1-800-843-3001.
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 ON THE ACCURACY OR ADEQUACY OF THIS PROXY STATEMENT AND PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
TABLE OF CONTENTS
VOTING INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . .
SYNOPSIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
COMPARISON OF PRINCIPAL RISK FACTORS . . . . . . . . . . . . . . . . . .
THE PROPOSAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ADDITIONAL INFORMATION ABOUT FICP: GOVERNMENT . . . . . . . . . . . . . .
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
APPENDIX A -- AGREEMENT AND PLAN OF REORGANIZATION AND
LIQUIDATION . . . . . . . . . . . . . . . . . . . . . . . . . .
ii
<PAGE>
U.S. GOVERNMENT PORTFOLIO
(a series of Fidelity Money Market Trust)
GOVERNMENT
(a series of Fidelity Institutional Cash Portfolios)
82 Devonshire Street
Boston, Massachusetts 02109
______________
PROXY STATEMENT AND PROSPECTUS
Special Meeting of Shareholders of
Fidelity Money Market Trust: U.S.
Government Portfolio
to be held on
September 13, 1995
______________
VOTING INFORMATION
This Proxy Statement and Prospectus (Proxy Statement) is being
furnished to shareholders of U.S. Government Portfolio (FMMT Government or
the Acquired Fund), a series of Fidelity Money Market Trust, (FMMT or a
Trust), in connection with the solicitation of proxies by the Board of
Trustees of the Trust (the Board), for use at a Special Meeting of
Shareholders (the Meeting) of FMMT Government to be held on September 13,
1995, or at any adjournment thereof. This Proxy Statement will first be
mailed to shareholders on or about July 26, 1995.
If a quorum is not present at the Meeting or a quorum is present
but sufficient votes to approve the proposal are not received, the persons
named as proxies may propose one or more adjournments of the Meeting to
permit further solicitation of proxies. Any such adjournment will require
the affirmative vote of a majority of those shares of FMMT Government
present at the Meeting or represented by proxy. When voting on a proposed
adjournment, the persons named as proxies will vote FOR the proposed
adjournment all shares that they are entitled to vote, unless directed to
vote AGAINST an item, in which case such shares will be voted against such
adjournment with respect to that item. A shareholder vote may be taken on
one or more of the proposals in this Proxy Statement or on any other
business properly presented at the Meeting prior to any such adjournment
if sufficient votes have been received and it is otherwise appropriate.
Broker non-votes are shares held in street name for which the
broker indicates that instructions have not been received from the
beneficial owners or other persons entitled to vote and the broker does
not have discretionary voting authority. Abstentions and broker non-votes
will be counted as shares present for purposes of determining whether a
quorum is present but will not be voted for or against any adjournment or
<PAGE>
proposal. Accordingly, abstentions and broker non-votes effectively will
be a vote against adjournment or against any proposal where the required
vote is a percentage of the shares present. Abstentions and broker non-
votes will not be counted, however, as votes cast for purposes of
determining whether sufficient votes have been received to approve a
proposal.
The individuals named as proxies on the enclosed proxy card will
vote in accordance with your direction as indicated thereon if your proxy
card is received properly executed by you or by your duly appointed agent
or attorney-in-fact. If you sign, date and return the proxy card, but
give no voting instructions, your shares will be voted in favor of
approval of the Agreement and Plan of Reorganization and Liquidation
(Reorganization Plan) attached to this Proxy Statement as Appendix A.
Under the Reorganization Plan, Fidelity Institutional Cash Portfolios:
Government (FICP Government or the Acquiring Fund) would acquire
substantially all of the assets of FMMT Government in exchange solely for
Class A Shares of beneficial interest in FICP Government and the
assumption by FICP Government of FMMT Government's liabilities; those FICP
Government Class A shares then would be distributed to the FMMT
Government's shareholders. (This transaction is referred to herein as a
Reorganization.) The duly appointed proxies may, in their discretion,
vote upon such other matters as may come before the Meeting or any
adjournments thereof. The proxy card may be revoked by giving another
proxy or by letter or telegram revoking such proxy. To be effective, such
revocation must be received by FMMT prior to the Meeting and must indicate
your name and account number. In addition, if you attend the Meeting in
person you may, if you wish, vote by ballot at the Meeting thereby
canceling any proxy previously given.
As of the record date, July 26, 1995 (Record Date), FMMT
Government had ____________ shares of beneficial interest outstanding.
The solicitation of proxies, the cost of which will be borne by Fidelity
Management & Research Company (FMR), the investment adviser of FMMT
Government, will be made primarily by mail but also may include telephone
or oral communications by regular employees of FMR who will not receive
any compensation therefor from FMMT Government, or by The 440 Financial
Group, professional proxy solicitors retained by FMR, who will be paid
fees and expenses of up to approximately $____ for soliciting services.
[Beneficial Ownership to be added.] Trustees and officers of FMMT
Government own in the aggregate less than 1% of the shares of that Fund.
Shareholders of FMMT Government are entitled to one vote for each dollar
of net asset value of the Fund they own.
Summarized below is the proposal FMMT Government shareholders are
being asked to consider:
To approve an Agreement and Plan of Reorganization and
Liquidation under which FICP Government would acquire
substantially all of the assets of FMMT Government in exchange
solely for Class A Shares of beneficial interest in FICP
Government and the assumption by FICP Government of FMMT
2
<PAGE>
Government's liabilities, followed by the distribution of FICP
Government Class A Shares to the shareholders of FMMT Government.
Approval of the Reorganization Plan requires the affirmative vote
of a majority of the outstanding voting securities of FMMT Government.
Under the Investment Company Act of 1940 (1940 Act) a "majority of the
outstanding voting securities" means the lesser of (1) 67% or more of a
fund's shares present at a meeting of shareholders if the owners of more
than 50% of the fund's shares then outstanding are present in person or by
proxy, or (2) more than 50% of a fund's outstanding shares.
SYNOPSIS
The following is a summary of certain information contained
elsewhere in this Proxy Statement, in the Reorganization Plan, and in the
prospectuses of FMMT Government and FICP Government, which are
incorporated herein by this reference. Shareholders should read the
entire Proxy Statement and the prospectus of FICP Government carefully.
As discussed more fully below, the Board believes that the proposed
Reorganization will benefit FMMT Government's shareholders. FICP
Government has an investment objective identical to that of FMMT
Government. As shareholders of FICP Government, it is anticipated that
the former shareholders of FMMT Government will be subject to lower
operating expenses measured as a percentage of net assets.
The Proposed Reorganization
FICP Government currently offers two classes of shares (each, a
Class and collectively, Classes), designated as Class A and Class B. FMMT
Government currently offers one class of shares.
The Reorganization Plan provides for the acquisition by FICP
Government of substantially all of the assets of FMMT Government in
exchange solely for Class A Shares of FICP Government and the assumption
by FICP Government of the liabilities of FMMT Government. (FMMT
Government and FICP Government are referred to herein collectively as
Funds and individually as a Fund.) FMMT Government will then distribute
the FICP Government Class A Shares to its shareholders so that each such
shareholder will receive the number of full and fractional Class A Shares
of FICP Government that corresponds to the number of Acquired Fund shares
held by such shareholder as of the Closing Date (defined below). The
exchange of FMMT Government's assets for FICP Government Class A Shares
will occur at or as of 5:00 p.m., Eastern time, on October 31, 1995 (the
Closing Date), or such other date as the parties may agree. FMMT
Government then will be liquidated as soon as practicable thereafter.
The rights and privileges of the former shareholders of FMMT
Government will be effectively unchanged by the Reorganization, other than
as described below under "Minimum Initial Investment and Account Balance,"
"Shareholder Services," "Purchases and Redemptions" and "Exchanges".
3
<PAGE>
For the reasons set forth below under "The Proposal-- Reasons for
the Reorganization," the Board, including the trustees who are not
"interested persons" of FMMT as that term is defined in the 1940 Act
(Independent Trustees), has concluded that the Reorganization is in the
best interests of FMMT Government, that the terms of the Reorganization
are fair and reasonable, and that the interests of FMMT Government's
shareholders will not be diluted as a result of the proposed transaction.
Accordingly, the Board recommends approval of the transaction. In
addition, the Board of Trustees of FICP, including the Independent
Trustees, has concluded that the Reorganization is in the best interests
of FICP Government, the terms of the Reorganization are fair and
reasonable, and that the interests of FICP Government's shareholders will
not be materially diluted as a result of the proposed transaction.
Expenses
If FMMT Government shareholders approve the Reorganization Plan,
the total operating expenses they would bear as shareholders of FICP
Government Class A Shares are currently limited to .20% of average net
assets because of a voluntary expense limitation currently in effect for
Class A Shares of FICP Government. Voluntary expense limitations exclude
interest, taxes, brokerage commissions, extraordinary expenses, and 12b-1
fees paid by Class B shares and may be terminated at any time.
Effective July 1, 1995, FMR voluntarily limited the total
operating expenses of FICP Government's Class A Shares to .20% of its
average net assets. Prior to that date, total operating expenses for FICP
Government's Class A shares were voluntarily limited to .18% of its
average net assets. If these limitations were not in effect, FICP
Government's management fee and total operating expenses for the fiscal
year ended March 31, 1995, would have been .20% and .24%, respectively.
Total operating expenses include, but are not limited to, the management
fee; fees paid to other FMR affiliates for transfer agency and pricing and
bookkeeping services; and fees paid to unaffiliated parties that provide
the Fund with services. Although FICP Government, unlike FMMT Government,
pays for each of these services separately (i.e., its management fee is
not all-inclusive) total operating expenses are currently limited to .20%
of its average net assets. (See Comparative Fee Tables below for more
information.)
FMMT Government pays FMR a management fee at the annual rate of
.42% of its average net assets. Because the fee is all-inclusive it
represents FMMT Government's total operating expenses. The Fund normally
does not incur other expenses. FMR not only provides the Fund with
investment advisory and research services, but also pays all of the Fund's
other expenses, with certain limited exceptions.
4
<PAGE>
Comparative Fee Tables
Reorganization of FMMT Government into FICP Government
The following table shows the current fees and expenses incurred
by FMMT Government and by Class A shares of FICP Government for the year
ended March 31, 1995 adjusted to reflect the current .20% voluntary
expense limitation, and pro forma fees for FICP Government's Class A
Shares including the effect of the Reorganization.
5
<PAGE>
Annual Fund Operating Expenses
(as a percentage of average net assets)
<TABLE>
<CAPTION>
FICP Government Pro Forma Fees
FMMT Government Class A Shares Combined Fund
<S> <C> <C> <C>
Management Fees . . . . . . . .42% .16% .16%
Other Expenses .00% .04% .04%
Total Fund Operating
Expenses . . . . . . . . . .42% .20%* .20%*
* Net of reimbursement
</TABLE>
Example of Effect of Fund Expenses
The following illustrates the expenses on a $1,000 investment under the
existing and estimated fees and the expenses stated above, assuming a 5%
annual return.
<TABLE>
<CAPTION>
ONE YEAR THREE YEARS FIVE YEARS TEN YEARS
<S> <C> <C> <C> <C>
FMMT Government $4 $13 $24 $53
FICP Government $2 $6 $11 $26
Class A Shares
Combined Fund $2 $6 $11 $26
</TABLE>
____________________________
This Example assumes that all dividends and other distributions
are reinvested and that the percentage amounts listed under Annual Fund
Operating Expenses remain the same in the years shown. The above tables
and the assumption in the Example of a 5% annual return are required by
regulations of the SEC; the assumed 5% annual return is not a prediction
of, and does not represent, the projected or actual performance of any
Fund.
The Example should not be considered a representation of past or
future expenses, and a Fund's actual expenses may be more or less than
those shown. The actual expenses attributable to each Fund will depend
upon, among other things, its level of average net assets. In addition,
6
<PAGE>
the actual expenses of FICP Government and the Combined Fund will also
depend on the extent to which a fund incurs variable expenses, such as
transfer agency costs and the terms of any reimbursement arrangements with
FMR. FMR currently limits FICP Government's Class A expenses to .20% of
its average net assets. Prior to July 1, 1995, FMR limited these expenses
to .18% of the average net assets of FICP Government's Class A shares.
Forms of Organization
Fidelity Institutional Cash Portfolios (FICP) is organized as a
Delaware business trust. FICP Government, a series of FICP, commenced
operations on July 25, 1985. FMMT is also organized as a Delaware
business trust. FMMT Government, a series of FMMT, commenced operations
on May 1, 1979. FMMT Government offers one class of shares. FICP
Government currently offers two classes of shares: Class A and Class B.
Each Trust is authorized to issue an unlimited number of each class of
shares. Because FICP Government and FMMT Government are each series of a
Delaware business trust, organized under substantially similar trust
instruments, the rights of the security holders of FMMT Government under
state law and the governing documents are expected to remain unchanged
after the Reorganization.
Investment Objectives and Policies
The investment objective and policies of each Fund are set forth
below. There can be no assurance that any Fund will achieve its
investment objective.
The investment objective of FMMT Government and of FICP
Government is to obtain as high a level of current income as is consistent
with the preservation of principal and liquidity within the limitations
prescribed for each Fund. Although each Fund seeks to maintain a stable
$1.00 share price, there can be no assurance that it will be able to do
so. An investment in a Fund is neither insured nor guaranteed by the U.S.
government.
FMMT Government and FICP Government each invests in instruments
which are issued or guaranteed as to principal and interest by the U.S.
government and in instruments issued by U.S. government agencies or
instrumentalities (agency obligations). Government securities purchased
by the Funds include instruments issued or guaranteed 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.
Agency obligations that the Funds may purchase include obligations of the
Federal Home Loan Banks, Federal Farm Credit Banks, and Federal National
Mortgage Association, which are backed only by the right of the issuer to
borrow from the U.S. Treasury under certain circumstances or are backed by
the credit of the issuer. Agency obligations are not deemed direct
obligations of the United States and involve more risk than direct
obligations of the U.S. government or U.S. Treasury.
7
<PAGE>
Other Policies of the Funds. Each Fund may invest up to 10% of
its net assets in illiquid securities and may engage in repurchase
agreements and reverse repurchase agreements.
Operations of FICP Government Following the Reorganization
FMR does not expect FICP Government to revise its investment
policies to reflect those of FMMT Government following the Reorganization.
In addition, FMR currently does not anticipate significant changes to the
Fund's management or to agents that provide the Fund with services.
Minimum Initial Investment and Account Balance
FICP Government requires a minimum initial investment of $1
million and a minimum account balance of $1 million. FMMT Government's
minimum initial investment and minimum account balance are each $100,000.
If the proposed Reorganization Plan is approved, former FMMT Government
shareholders would be subject to FICP Government's $1 million minimum.
Nevertheless, FICP Government intends to permanently waive these
requirements for FMMT Government accounts that, as of the Closing Date,
have balances of less than $1 million.
Shareholder Services
Unlike FICP Government, FMMT Government offers its shareholders
subaccounting services, such as recordkeeping. If FMMT Government
shareholders approve the Fund's Reorganization Plan, these services would
continue to be available only to those accounts that currently use them;
they would not be offered to existing accounts which currently do not use
them or to new accounts. FMMT Government offers certain other services
that FICP Government does not, such as a broad exchange policy (see
"Purchases and Redemptions" and "Exchanges" below for more information).
Thus, these services would no longer be available to former FMMT
Government shareholders after the Reorganization.
Purchases and Redemptions
Shares of FMMT Government are normally priced at 3:00 p.m. and at
4:00 p.m. Eastern time each day the Fund is open for business. Class A
Shares of FICP Government are normally priced at 3:00 p.m. Eastern time
each day the Fund is open for business.
Shares of FMMT Government and Class A shares of FICP Government
purchased at the 3:00 p.m. price will begin to earn income dividends that
day. FMMT Government shares purchased at the 4:00 p.m. price will begin
to earn dividend income dividends on the following business day.
Shares of each Fund may be redeemed on any business day at their
net asset value, normally expected to be $1.00 per share. Each Fund's
shareholders may redeem shares by telephone. If telephone instructions
are received between 8:30 a.m. and 3:00 p.m. Eastern time for redemptions
from FMMT Government or from FICP Government, redemption proceeds will be
8
<PAGE>
wired that day to the shareholder's bank account of record and the shares
will not receive that day's dividend. Shares of FMMT Government redeemed
at the 4:00 p.m. price will receive that day's dividend and redemption
proceeds will be wired on the following business day.
If FMMT Government shareholders approve the Reorganization Plan,
shares of FMMT Government will continue to be available for purchase,
including purchases through the reinvestment of dividends, by existing
shareholders through the Closing Date. New accounts in FMMT Government
may not be opened after July 26, 1995. If the Meeting is adjourned and
the Reorganization is approved on a later date, shares will no longer be
available for purchase or exchange on the business day following the date
on which the Reorganization is approved. Redemptions of FMMT Government's
shares and exchanges of such shares for shares of any other Fidelity fund
may be effected through the Closing Date (see "Exchanges" below).
Exchanges
If shareholders of FMMT Government approve the Reorganization
Plan, former FMMT Government shareholders would be subject to the exchange
privilege currently offered by FICP Government. Specifically,
shareholders of Class A Shares of FICP Government may exchange their
shares only for Class A Shares of other FICP Portfolios or for Class A
Shares of Fidelity Institutional Tax-Exempt Cash Portfolios: Tax-Exempt.
Currently, shares of FMMT Government may be exchanged for shares of any
other Fidelity fund registered in a shareholder's state. FICP Government
Shareholders may redeem their FICP Government shares and subsequently
purchase shares of other Fidelity funds.
Dividends and Other Distributions
Each Fund ordinarily declares dividends from its net investment
income daily and pays such dividends monthly. Each Fund also distributes
annually and on a fiscal-year basis substantially all of its net
investment income. On or before the Closing Date, FMMT Government will
declare as a dividend substantially all of its taxable income and net
realized capital gain, if any, in order to maintain its tax status as a
regulated investment company.
Federal Income Tax Consequences of the Reorganizations
Each Trust has received an opinion of its counsel, Kirkpatrick &
Lockhart LLP to the effect that the Reorganization will be tax-free.
Please see the section entitled "Federal Income Tax Considerations" for
more information.
COMPARISON OF PRINCIPAL RISK FACTORS
Because FMMT Government and FICP Government are money market
funds, each must comply with federal regulatory requirements applicable to
all money market funds concerning the quality and maturity of their
9
<PAGE>
investments. Federal regulations limit money market fund investments to
high-quality securities (those securities rated by at least two nationally
recognized rating services in one of the two highest categories for short-
term securities or by one rating service, if only one has rated the
security, or unrated securities deemed by FMR to be of equivalent
quality). The maturity (calculated according to applicable regulations)
of money market investments cannot exceed 397 days and a money market
fund's dollar-weighted average maturity cannot exceed 90 days. These
requirements, coupled with each Fund's emphasis on high-quality U.S.
government securities, mean that the Funds have substantially the same
investment policies and levels of risk.
Although the Funds seek to maintain stable $1.00 share prices,
the Funds' investment income is based on the income earned on the
securities they hold, less expenses incurred. Thus, the Funds' investment
income may be expected to fluctuate in response to changes in such
expenses or income.
THE PROPOSAL
TO APPROVE AN AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION BETWEEN
FIDELITY MONEY MARKET TRUST: U.S. GOVERNMENT PORTFOLIO AND FIDELITY
INSTITUTIONAL CASH PORTFOLIOS: GOVERNMENT
Reorganization Plan
The terms and conditions under which the proposed transaction may
be consummated are set forth in the Reorganization Plan. Significant
provisions of the Plan are summarized below; however, this summary is
qualified in its entirety by reference to the Plan, a copy of which is
attached as Appendix A to this Proxy Statement.
The Plan contemplates (a) FICP Government acquiring on the
Closing Date substantially all of the assets of FMMT Government in
exchange solely for Class A Shares of FICP Government and the assumption
by FICP Government of FMMT Government's liabilities; and (b) the
distribution the Class A shares of FICP Government to the shareholders of
FMMT Government as provided in the Reorganization Plan.
The assets of FMMT Government to be acquired by FICP Government,
include substantially all cash, cash equivalents, securities, receivables
(including interest or dividends receivable), claims, choses in action,
and other property owned by FMMT Government, and any deferred or prepaid
expenses shown as an asset on the books of FMMT Government on the Closing
Date. FICP Government will assume from FMMT Government all debts,
liabilities, obligations, and duties of FMMT Government of whatever kind
or nature; provided however, that FMMT Government will use its best
efforts, to the extent practicable, to discharge all of its known debts,
liabilities, and obligations prior to the Closing Date. FICP Government
also will deliver to FMMT Government Class A Shares of FICP Government,
which FMMT Government shall then distribute to its shareholders.
10
<PAGE>
The value of FMMT Government's assets to be acquired by FICP
Government, the amount of its liabilities to be assumed by FICP
Government, and the net asset value of a share of FICP Government will be
determined as of the close business of each fund on the Closing Date.
Portfolio securities will be valued on the basis of amortized cost. This
method of valuation 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. If the Trustees believe that a
deviation from a Fund'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.
Immediately after the Closing Date, FMMT Government will
liquidate and distribute pro rata to its shareholders of record the
Class A Shares of FICP Government it received, so that each FMMT
Government shareholder will receive a number of full and fractional
Class A Shares of FICP Government equal to the number of full and
fractional shares in FMMT Government held by such shareholder on the
Closing Date; FMMT Government will be liquidated as soon as is practicable
thereafter. Such liquidation and distribution will be accomplished by
transferring Class A Shares then credited to the account of FMMT
Government to FICP Government, opening accounts on the books of FICP
Government in the names of FMMT Government shareholders and representing
the respective pro rata number of FICP Government shares due such
shareholders. Fractional shares of FICP Government will be rounded to the
third decimal place.
Accordingly, immediately after the Reorganization, each former
shareholder of FMMT Government will own Class A Shares of FICP Government
that will be equal to the number of that shareholder's shares of FMMT
Government immediately prior to the Reorganization. The net asset value
per share of FICP Government will be unchanged by the transaction. Thus,
the Reorganization will not result in a material dilution of any
shareholder interest.
Any transfer taxes payable upon issuance of Class A Shares of
FICP Government in a name other than that of the registered holder of the
shares on the books of FMMT Government as of that time shall be paid by
the person to whom such shares are to be issued as a condition of such
transfer. Any reporting responsibility of FMMT Government will continue
to be its responsibility up to and including the Closing Date and such
later date on which FMMT Government is liquidated.
FMR will bear the cost of the Reorganization, including
professional fees and the cost of soliciting proxies for the Meeting,
consisting principally of printing and mailing prospectuses and proxy
statements, together with the cost of any supplementary solicitation, and
expenses associated with the filing of registration statements.
11
<PAGE>
The consummation of the Reorganization is subject to a number of
conditions set forth in the Plan, some of which may be waived by a Trust.
In addition, the Reorganization Plan may be amended in any mutually
agreeable manner, except that no amendment that may have a materially
adverse effect on the shareholders' interests may be made subsequent to
the Meeting.
Reasons for the Reorganization
In considering the Reorganization, the Board made an extensive
inquiry into a number of factors, including the following:
(1) the compatibility of the investment objectives and policies of
the Funds;
(2) the expense ratios of the Funds after the Reorganization relative
to their current expense ratios;
(3) the tax consequences of the Reorganization;
(4) each Fund's current asset level;
(5) anticipated reductions in duplicative funds resulting in
facilitated portfolio management and increased operational
efficiencies; and
(6) services available to shareholders before and after the proposed
Reorganization.
The Board also noted that although FMMT Government offers more
shareholder services and has lower minimum initial investment and account
balance requirements than does FICP Government, it has not successfully
attracted substantial assets, only a few shareholders currently take
advantage of its sub-accounting services, and it has higher total
operating expenses than FICP Government. FMR believes that FICP
Government has been more successful in building a large asset base because
of its lower expense ratios.
The Board concluded that, if the Reorganization is approved,
former FMMT Government shareholders will lose the opportunity to obtain
certain services and features to the extent that they do not currently
utilize them, but will benefit from FICP Government's larger asset base
and lower operating expenses.
Description of Securities to be Issued
FICP is registered with the SEC as an open-end management
investment company. FICP's trustees are authorized to issue an unlimited
number of shares of beneficial interest of separate series (net asset
value $1.00 per share). FICP Government is one of five series of FICP.
FICP's Trustees have authorized the public offering of two classes of
shares of FICP Government. Each share in a class represents an equal
proportionate interest in FICP Government with each other share in that
class. Shares of FICP Government entitle their holders to one vote per
full share and fractional votes for fractional shares held with respect to
matters affecting that class or the Fund as a whole.
12
<PAGE>
On the Closing Date, FICP Government will have two classes of
shares outstanding: Class A and Class B. Only Class A Shares will be
issued to FMMT Government and distributed to its shareholders as part of
the Reorganization. Each Class represents interests in the same assets of
the Fund. The Classes differ as follows: (1) each Class has exclusive
voting rights on matters pertaining to the plan of distribution with
respect to that class; (2) Class B shares bear ongoing distribution
expenses; and (3) each Class may bear differing amounts of certain Class-
specific expenses. Each share of each Class of FICP Government is
entitled to participate equally in dividends and other distributions and
in the proceeds of any liquidation, except that dividends on each Class
may be affected by the allocation of expenses to that Class.
FICP does not hold annual meetings of shareholders. There will
normally be no meetings of shareholders for the purpose of electing
Trustees unless less than a majority of the trustees holding office have
been elected by shareholders, at which time the Trustees then in office
will call a shareholders meeting for the election of Trustees. Under the
1940 Act, shareholders of record of at least two-thirds of the outstanding
shares of an investment company may remove a trustee by votes cast in
person or by proxy at a meeting called for that purpose. The Trustees are
required to call a meeting of shareholders for the purpose of voting upon
the question of removal of any Trustee when requested in writing to do so
by the shareholders of record holding at least 10% of the Trust's
outstanding shares.
Federal Income Tax Considerations
The exchange of the Acquired Fund's assets for Acquiring Fund
shares and the Acquiring Fund's assumption of the liabilities of the
Acquired Fund is intended to qualify for federal income tax purposes as a
tax-free reorganization under section 368(a)(1)(C) of the United States
Internal Revenue Service Code of 1986, as amended (the Code). With
respect to the Reorganization, the participating Funds have received an
opinion from Kirkpatrick & Lockhart LLP, counsel to FMMT and FICP
substantially to the effect that:
(i) The acquisition by FICP Government of substantially all of the
assets of FMMT Government solely in exchange for FICP Government
Class A Shares, and the assumption by FICP Government of FMMT
Government's liabilities, followed by the distribution by FMMT
Government of FICP Government Class A Shares to the shareholders
of FMMT Government pursuant to the liquidation of FMMT Government
and constructively in exchange for their FMMT Government shares,
will constitute a reorganization within the meaning of section
368(a)(1)(C) of the Code, and FMMT Government and FICP Government
will each be "a party to a reorganization" within the meaning of
section 368(b) of the Code;
(ii) No gain or loss will be recognized by FMMT Government upon the
transfer of substantially all of its assets to FICP Government in
exchange solely for FICP Government Class A Shares and FICP
13
<PAGE>
Government's assumption of FMMT Government's liabilities,
followed by FMMT Government's subsequent distribution of those
Class A shares to shareholders in liquidation of FMMT Government;
(iii) No gain or loss will be recognized by FICP Government upon the
receipt of the assets of FMMT Government in exchange solely for
FICP Government Class A shares and its assumption of FMMT
Government's liabilities;
(iv) The shareholders of FMMT Government will recognize no gain or
loss upon the exchange of their FMMT Government shares solely for
FICP Government Class A Shares;
(v) The basis of FMMT Government's assets in the hands of FICP
Government will be the same as the basis of those assets in the
hands of FMMT Government immediately prior to the Reorganization,
and the holding period of those assets in the hands of FICP
Government will include the holding period of those assets in the
hands of FMMT Government;
(vi) The basis of FMMT Government shareholders in FICP Government
Class A shares will be the same as their basis in FMMT Government
shares to be constructively surrendered in exchange therefor; and
(vii) The holding period of the FICP Government Class A shares to be
received by the FMMT Government shareholders will include the
period during which the FMMT Government shares to be
constructively surrendered in exchange therefor were held,
provided such FMMT Government shares were held as capital assets
by those shareholders on the date of the Reorganization.
Shareholders of FMMT Government should consult their tax advisers
regarding the effect, if any, of the proposed Reorganization in light of
their individual circumstances. Because the foregoing discussion only
relates to the federal income tax consequences of the Reorganization,
those shareholders also should consult their tax advisers as to state and
local tax consequences, if any, of the Reorganization.
Capitalization
The following tables show the capitalization of the Funds as of
March 31, 1995 (unaudited for FMMT Government), and on a pro forma
combined basis (unaudited) as of that date giving effect to the
Reorganization.
14
<PAGE>
<TABLE>
<CAPTION>
FMMT Government Pro Forma
FICP Government Combined
<S> <C> <C> <C>
Net Assets $3,321,065,528 $208,419,684 $3,529,485,212
Class A (1) . . . . . . . . . . . . . . . .
Net Asset Value Per Share $1.00 $1.00 $1.00
Class A(1) . . . . . . . . . . . . . . . . .
Shares Outstanding 3,321,584,137 208,392,418 3,529,976,555
Class A(1) . . . . . . . . . . . . . . . . .
_________________________________
</TABLE>
(1) Only FICP Government offers different classes of
shares. Shares of FMMT Government will be exchanged
for Class A Shares of FICP Government.
Conclusion
The Agreement and Plan of Reorganization and Liquidation and the
transactions provided for therein were approved by the Board at a meeting
held on March 16, 1995. The Boards of Trustees of FMMT and FICP
determined that the interests of existing shareholders of FMMT Government
and FICP Government would not be materially diluted as a result of the
Reorganization. In the event that the Reorganization is not consummated,
FMMT Government will continue to engage in business as a fund of a
registered investment company and the Board of FMMT will consider other
proposals for the reorganization or liquidation of the Fund.
ADDITIONAL INFORMATION ABOUT FICP GOVERNMENT
Financial Highlights
The table below provides condensed information concerning income
changes for one Class A share of FICP Government for the periods shown.
This information is supplemented by the financial statements and
accompanying notes appearing in FICP Government's Annual Report to
Shareholders for the fiscal year ended March 31, 1995, which are
incorporated herein by this reference into the Statement of Additional
Information. The financial statements and notes and the financial
information in the tables below have been audited by Price Waterhouse LLP,
independent certified public accountants, whose report thereon is included
in the Annual Report to Shareholders and may be obtained by shareholders.
15
<PAGE>
FINANCIAL HIGHLIGHTS - CLASS A
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
1995 1994 1993 1992 1991
351.SELECTED PER-SHARE DATA
352.Net asset value, beginning of period $ 1.000 $ 1.000 $1.000 $1.000 $1.000
353.Income from Investment Operations
.035 .054 .077
354. Net interest income .048 .031
355.Less Distributions
356. From net interest income (.048) (.031) (0.35) (.054) (0.77)
357.Net asset value, end of period $ 1.000 $1.000 $1.000 $1.000 $1.000
358.TOTAL RETURN A 4.86% 3.13% 3.56% 5.55% 7.94%
359.RATIOS AND SUPPLEMENTAL DATA
360.Net assets, end of period (000 omitted) $3,321,066 $3,764,544 $5,686,166 $4,603,781 $3,613,838
361.Ratio of expenses to average net assets .18% .18% .18% .18% .18%
362. Ratio of expenses to average net assets .24% .24% .24% .25% .25%
before expense reductions
363.Ratio of net interest income to average net
assets 4.77% 3.07% 3.50% 5.33% 7.62%
</TABLE>
A TOTAL RETURN RETURN WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN
REDUCED DURING THE PERIODS SHOWN. SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<PAGE>
[Financial Highlights Tables]
MISCELLANEOUS
Available Information
FMMT and FICP are each subject to the informational requirements of
the Securities Exchange Act of 1934 and the 1940 Act, and in accordance
therewith file reports, proxy material and other information with the SEC.
Such reports, proxy material and other information can be inspected and
copied at the Public Reference Room maintained by the SEC at 450 Fifth
Street, N.W., Washington, D.C. 20549. Copies of such material can also be
obtained from the Public Reference Branch, Office of Consumer Affairs and
Information Services, Securities and Exchange Commission, Washington, D.C.
20549, at prescribed rates.
Legal Matters
Certain legal matters in connection with the issuance of Class A
Shares of FICP Government will be passed upon by Kirkpatrick & Lockhart
LLP, counsel to the Trusts.
Experts
The audited financial statements of FICP Government incorporated by
reference in the Statement of Additional Information, have been examined
by Price Waterhouse LLP, independent accountants, whose report thereon is
included in the Fund's Annual Report to Shareholders for the fiscal year
ended March 31, 1995. The audited financial statements of FMMT Government
incorporated by reference in the Statement of Additional Information, have
been examined by Coopers & Lybrand L.L.P., independent accountants, whose
report thereon is included in the Fund's Annual Report to Shareholders for
the fiscal year ended August 31, 1994. Unaudited financial statements for
FMMT Government for the six-month period ended February 28, 1995 are also
incorporated by reference. The financial statements audited by Price
Waterhouse LLP and Coopers & Lybrand L.L.P. have been incorporated herein
by reference in reliance on their reports given on their authority as
experts in auditing and accounting.
Notice to Banks, Broker-Dealers and Voting Trustees and Their Nominees
Please advise FMMT Government, in care of Fidelity Money Market
Trust, 82 Devonshire Street, Boston, MA 02109 (Attn: _____________),
whether other persons are beneficial owners of shares for which Proxy
Statements are being solicited and if so, the number of copies of the
Proxy Statement you wish to receive in order to supply copies to the
beneficial owners of the respective shares.
16
<PAGE>
APPENDIX A
AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
FIDELITY MONEY MARKET TRUST: U.S. GOVERNMENT PORTFOLIO
17
<PAGE>
EXHIBIT 1
AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
THIS AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION (the
Agreement) is made as of the [19] day of June, 1995 by and among U.S.
Government Portfolio (FMMT Government), a fund of Fidelity Money Market
Trust (FMMT), Government (FICP Government), a fund of Fidelity
Institutional Cash Portfolios (FICP), and Fidelity Management & Research
Company (FMR). (FMMT and FICP may hereinafter be referred to collectively
as the "Trusts" or individually as a "Trust".) Each trust is a duly
organized business trust under the laws of the State of Delaware and FMR
is a Massachusetts corporation, each with its principal place of business
at 82 Devonshire Street, Boston, Massachusetts 02109.
This Agreement is intended to be, and is adopted as, a plan of
reorganization and liquidation within the meaning of Section 368(a)(1)(C)
of the United States Internal Revenue Code of 1986, as amended (the Code).
The reorganization (Reorganization) will comprise the transfer of
substantially all of the assets of FMMT Government in exchange solely for
Class A Shares of beneficial interest of FICP Government, and the
assumption by FICP Government of FMMT Government's liabilities, followed
by the constructive distribution, after the Closing Date hereinafter
referred to, of such Class A Shares of FICP Government to the shareholders
of FMMT Government in liquidation of FMMT Government as provided herein,
all upon the terms and conditions hereinafter set forth in this Agreement.
In consideration of the premises and of the covenants and agreements
hereinafter set forth, the parties hereto covenant and agree as follows:
1. TRANSFER OF ASSETS AND ASSUMPTION OF LIABILITIES OF FMMT GOVERNMENT
IN EXCHANGE FOR CLASS A SHARES OF FICP GOVERNMENT AND LIQUIDATION OF
FMMT GOVERNMENT
1. As of the date of this Agreement, FICP Government offers two
classes of shares, Class A and Class B and FMMT Government offers one
class of shares. As contemplated herein, in exchange for
substantially all of the assets of FMMT Government and the assumption
by FICP Government of FMMT Government's liabilities, FICP Government
shall deliver Class A Shares of FICP Government to FMMT Government.
2. Subject to the terms and conditions herein set forth, and on the
basis of the representations and warranties contained herein, FMMT
Government agrees to transfer its assets as set forth in paragraph
1.3 to FICP Government and FICP Government agrees to assume FMMT
Government's liabilities described in paragraph 1.4 hereof, and
deliver to FMMT Government in exchange therefor the number of Class A
Shares of FICP Government equal in value (calculated in the manner
and as of the time set forth in paragraph 2.2) to the net asset value
-1-
<PAGE>
per share of FMMT Government (calculated in the manner and as of the
time set forth in paragraph 2.1) multiplied by the number of shares
of FMMT Government then outstanding.
3. The assets of FMMT Government to be acquired by FICP Government
shall include substantially all cash, cash equivalents, securities,
receivables (including interest or dividends receivable), claims,
choses in action, and other property owned by FMMT Government and any
deferred or prepaid expenses shown as an asset on the books of FMMT
Government on the closing date.
4. The liabilities to be assumed by FICP Government shall include
(except as otherwise provided herein) all of FMMT Government's
liabilities, debts, obligations, and duties of whatever kind or
nature, whether absolute, accrued, contingent or otherwise, arising
in the ordinary course of business. Notwithstanding the foregoing,
FMMT Government agrees to use its best efforts to discharge all of
its known liabilities prior to the Closing Date.
5. In order for FMMT Government to comply with Section 852(a)(1) of
the Code and to avoid having any taxable income in the short taxable
year ending with its dissolution, FMMT Government will, prior to the
Closing Date, as defined below, declare a dividend so that it will
have declared dividends of substantially all of its investment
company taxable income and net realized capital gain, if any, for
such taxable year.
6. As provided in paragraph 3.4, as soon after the Closing Date as
is conveniently practicable (the Liquidation Date), FMMT Government
will liquidate and distribute pro rata to its shareholders of record,
determined as of the close of business on the Closing Date, the FICP
Government Class A Shares received by FMMT Government pursuant to
Article 1 in exchange for their interest in FMMT Government evidenced
by their shares of beneficial interest in FMMT Government shares.
Such liquidation and distribution will be accomplished by the
transfer of the shares then credited to the account of FMMT
Government on the books of FICP Government, to open accounts on the
share records of FICP Government in the names of the FMMT Government
shareholders and representing the respective pro rata number of FICP
Government Class A Shares due such shareholders. FICP Government
shall not issue certificates representing its shares in connection
with such exchange. Fractional shares of FICP Government shall be
rounded to the third decimal place.
7. Ownership of FICP Government Class A Shares will be shown on the
books of FICP Government's transfer agent. FICP Government Class A
Shares will be issued in the manner described in FICP Government's
current Class A Prospectus and Statement of Additional Information.
8. Any transfer taxes payable upon the issuance of Class A Shares of
FICP Government in a name other than the registered holder of the
shares on the books of FMMT Government as of that time shall be paid
-2-
<PAGE>
by the person to whom such shares are to be issued as a condition of
such transfer.
9. Any reporting responsibility of FMMT Government is and shall
remain the responsibility of FMMT Government up to and including the
Closing Date and such later date on which FMMT Government is
liquidated.
2. VALUATION
1. The net asset value per share of FMMT Government's shares shall
be computed as of the close of business on the Closing Date, using
the valuation procedures set forth in FMMT Government's then current
Prospectus or Statement of Additional Information.
2. The value of FICP Government Class A Shares shall be the net
asset value per share computed as of the Closing Date, using the
valuation procedures set forth in FICP Government's then current
Class A Prospectus or Statement of Additional Information.
3. All computations of value shall be made by Fidelity Service Co.,
a division of FMR Corp., in accordance with its regular practice as
pricing agent for FICP Government and FMMT Government.
3. CLOSING AND CLOSING DATE
1. The Closing Date shall be October 31, 1995, or such other date
as the parties may agree in writing. All acts taking place at the
Closing shall be deemed to take place simultaneously as of 5:00 p.m.
Eastern time on the Closing Date unless otherwise provided. The
Closing shall be held at 5:00 p.m. Eastern time at the office of FMMT
or at such other time and/or place as the parties may agree.
2. Morgan Guaranty Trust Company of New York, as custodian for FMMT
Government and FICP Government (the Custodian), shall deliver at the
Closing a certificate of an authorized officer stating the (a) FMMT
Government's portfolio securities, cash, and other assets have been
delivered in proper form to FICP Government prior to close of
business on the Closing Date; and (b) all necessary taxes including
all applicable Federal and state stock transfer stamps, if any, shall
have been paid, or provision for payment shall have been made by FMMT
Government, in conjunction with the delivery of portfolio securities.
3. In the event that on the Closing Date (a) The Federal Reserve
Bank of New York is closed, (b) the market for government securities
is closed to trading or trading thereon is restricted, or (c) trading
or the reporting of trading on said market or elsewhere is disrupted
so that accurate appraisal of the value of the total net assets of
FMMT Government and FICP Government is impracticable, the Closing
Date shall be postponed until the first business day after the day
when trading shall have been fully resumed and reporting shall have
been restored, or such other date as the parties may agree.
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4. Fidelity Investments Institutional Operations Co. (FIIOC), as
transfer agent for FMMT Government and FICP Government, shall deliver
at the Closing a list of the names and addresses of FMMT Government's
shareholders and the number and percentage ownership of outstanding
shares owned by each such shareholder of FMMT Government, all as of
the close of business on the Closing Date, certified by an officer of
FIIOC. FICP Government shall issue and deliver to the Secretary or
Assistant Secretary of FMMT Government a confirmation evidencing the
Class A Shares of FICP Government to be credited on the Liquidation
Date, or provide evidence satisfactory to FMMT Government that such
Class A Shares of FICP Government have been credited to FMMT
Government's account on the books of FICP Government. At the
Closing, each party shall deliver to the other such bills of sale,
checks, assignments, stock certificates, receipts or other documents
as such other party or its counsel may reasonably request.
4. REPRESENTATIONS AND WARRANTIES
1. FMMT Government represents and warrants as follows:
A. FMMT Government is a series of FMMT, a Delaware business
trust duly organized, validly existing and in good standing
under the laws of the State of Delaware;
B. FMMT is an open-end, management investment company duly
registered under the Investment Company Act of 1940 (the 1940
Act), and such registration is in full force and effect;
C. FMMT Government is not in, and the execution, delivery and
performance of this Agreement will not result in, violation of
any provision of the Trust Instrument or By-Laws of FMMT, or, to
the knowledge of FMMT Government, of any agreement, indenture,
instrument, contract, lease or other undertaking to which FMMT
Government is a party or by which FMMT Government is bound;
D. FMMT Government has no material contracts or other
commitments (other than this Agreement) which will not be
terminated without liability to FMMT Government prior to the
Closing Date;
E. No material litigation or administrative proceeding or
investigation of or before any court or governmental body is
presently pending or to the knowledge of FMMT Government
threatened against FMMT Government or any of its properties or
assets, except as previously disclosed in writing to FICP
Government. FMMT Government knows of no facts which might form
the basis for the institution of such proceedings, and FMMT
Government is not a party to or subject to the provisions of any
order, decree or judgment of any court or governmental body
which materially and adversely affects its business or its
ability to consummate the transactions herein contemplated;
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<PAGE>
F. The Statement of Assets and Liabilities, the Statement of
Operations, the Statement of Changes in Net Assets, Per-Share
Data and Ratios, and the Schedule of Investments of FMMT
Government at August 31, 1994 which have been audited by Coopers
& Lybrand L.L.P., independent accountants, in accordance with
generally accepted auditing standards, and unaudited statements
for the six months ended February 28, 1995, have been furnished
to FICP Government. Such financial statements are presented in
accordance with generally accepted accounting principles, and
fairly present, in all material respects, the financial
condition of FMMT Government as of such dates, and there are no
material known liabilities of FMMT Government at such date
(contingent or otherwise) not disclosed therein;
G. Since August 31, 1994, there has not been any material
adverse change in FMMT Government's financial condition, assets,
liabilities or business, other than changes occurring in the
ordinary course of business;
H. At the date hereof and at the Closing Date, all Federal and
other tax returns and reports of FMMT Government required by law
to have been filed by such dates shall have been filed, and all
Federal and other taxes shall have been paid so far as due, or
provision shall have been made for the payment thereof, and, to
the best of FMMT Government's knowledge, no such return is
currently under audit and no assessment has been asserted with
respect to such returns;
I. For the taxable fiscal years from October 31, 1985 through
October 31, 1991, the fiscal period from November 1, 1991
through August 31, 1992, and for each subsequent taxable fiscal
year ended August 31 through the fiscal year ended August 31,
1994, FMMT Government has met the requirements of Subchapter M
of the Code for qualification and treatment as a regulated
investment company and intends to meet such requirements for its
taxable year ending with its dissolution;
J. All issued and outstanding FMMT Government shares are, and
at the Closing Date will be, duly and validly issued and
outstanding, fully paid and nonassessable as a matter of
Delaware law. All of the issued and outstanding FMMT Government
shares will, at the time of Closing, be held by the persons and
in the amounts set forth in the list of shareholders submitted
to FICP Government in accordance with the provisions of
paragraph 3.4 hereof.
K. At the Closing Date, FMMT Government will have good and
marketable title to its assets to be transferred to FICP
Government pursuant to paragraph 1.2 hereof, and full right,
power and authority to sell, assign, transfer and deliver such
assets hereunder free of any liens or other encumbrances, and
upon delivery and payment for such assets, FICP Government will
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acquire good and marketable title thereto, subject to no
restrictions on the full transfer thereof, including such
restrictions as might arise under the Securities Act of 1933, as
amended (the 1933 Act);
L. The execution, delivery and performance of this Agreement
will have been duly authorized prior to the Closing Date by all
necessary corporate action on the part of FMMT Government, and
this Agreement constitutes a valid and binding obligation of
FMMT Government enforceable in accordance with its terms,
subject to shareholder approval;
M. The information to be furnished by FMMT Government for use
in applications for orders, registration statements, proxy
materials and other documents which may be necessary in
connection with the transactions contemplated hereby shall be
accurate and complete and shall comply in all material respects
with Federal securities and other laws and regulations
thereunder applicable thereto;
N. The proxy statement of FMMT Government to be included in
the registration statement filed with the Securities and
Exchange Commission by FMMT on Form N-14 relating to the FICP
Government Class A Shares issuable thereunder, and any
supplement or amendment thereto (the Registration Statement), on
the effective date of the Registration Statement, at the time of
the meeting of FMMT Government's shareholders, and on the
Closing Date (i) will comply in all material respects with the
provisions of the Securities Exchange Act of 1934 (the 1934 Act)
and the 1940 Act and the rules and regulations thereunder, and
(ii) will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
O. FMMT Government will declare to shareholders of record, on
or prior to the Closing Date, one or more dividends or
distributions which, together with all previous such dividends
or distributions, shall have the effect of distributing to the
shareholders substantially all of its investment company taxable
income and net realized capital gains, if any, as of the Closing
Date;
P. FMMT Government will, from time to time, as and when
requested by FICP Government, execute and deliver or cause to be
executed and delivered, all such assignments and other
instruments, and will take or cause to be taken such further
action, as FICP Government may deem necessary or desirable in
order to vest in and confirm to FICP Government title to and
possession of all the assets of FMMT Government to be sold,
assigned, transferred and delivered hereunder and otherwise to
carry out the intent and purpose of this Agreement;
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Q. The execution and delivery of this Agreement does not, and
the consummation of the transactions contemplated hereby will
not, conflict with FMMT's Trust Instrument or By-Laws or, to
FMMT Government's knowledge, any provision of any agreement to
which FMMT Government is a party or by which it is bound or, to
the knowledge of FMMT Government, result in the acceleration of
any obligation or the imposition of any penalty under any
agreement, judgment or decree to which FMMT Government is a
party or by which it is bound;
R. To FMMT Government's knowledge, no consent, approval,
authorization or order of any court or governmental authority is
required for the consummation by FMMT Government of the
transactions contemplated herein, except such as have been
obtained under the 1933 Act, the 1934 Act, and the 1940 Act and
such as may be required under state securities laws; and
S. The fair market value of the assets of FMMT Government will
equal or exceed the liabilities to be assumed by FICP Government
and to which the assets are subject.
T. FMMT Government's liabilities to be assumed by FICP
Government were incurred in the ordinary course of business.
2. FICP Government represents and warrants as follows:
A. FICP Government is a series of FICP, a Delaware business
trust duly organized, validly existing and in good standing
under the laws of the State of Delaware;
B. FICP is an open-end, management investment company duly
registered under the 1940 Act, and such registration is in full
force and effect;
C. FICP Government is not in, and the execution, delivery and
performance of this agreement will not result in, violation of
any provisions of the Trust Instrument or By-Laws of FICP, or,
to the knowledge of FICP Government, of any agreement,
indenture, instrument, contract, lease or other undertaking to
which FICP Government is a party or by which FICP Government is
bound;
D. No material litigation or administrative proceeding or
investigation of or before any court or governmental body is
presently pending or, to the knowledge of FICP Government,
threatened against FICP Government or any of its properties or
assets, except as previously disclosed in writing to FMMT
Government. FICP Government knows of no facts which might form
the basis for the institution of such proceedings and FICP
Government is not a party to or subject to the provisions of any
order, decree or judgment of any court or governmental body
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which materially and adversely affects its business or its
ability to consummate the transactions herein contemplated;
E. The Statement of Assets and Liabilities, the Statement of
Operations, the Statement of Changes in Net Assets, Per-Share
Data and Ratios and the Schedule of Investments of FICP
Government at March 31, 1995 (copies of which have been
furnished to FMMT Government) are presented in accordance with
generally accepted accounting principles, and fairly present, in
all material respects, the financial condition of FICP
Government as of such date, and there are no material known
liabilities of FICP Government at such date (contingent or
otherwise) not disclosed therein;
F. Since March 31, 1995, there has not been any material
adverse change in FICP Government's financial condition, assets,
liabilities or business other than changes occurring in the
ordinary course of business;
G. At the date hereof and at the Closing Date, all Federal and
other tax returns and reports of FICP Government required by law
to have been filed by such dates shall have been filed, and all
Federal and other taxes shall have been paid insofar as due, or
provision shall have been made for the payment thereof, and, to
the best of FICP Government's knowledge, no such return is
currently under audit and no assessment has been asserted with
respect to such returns;
H. For the taxable fiscal period from February 2, 1987 through
March 31, 1987 and for each subsequent taxable fiscal year ended
March 31 through the fiscal year ended March 31, 1995, FICP
Government has met the requirements of Subchapter M of the Code
for qualification and treatment as a regulated investment
company and intends to meet such requirements for its current
fiscal year;
I. All issued and outstanding FICP Government Class A Shares
are, and at the Closing will be, duly and validly issued and
outstanding, fully paid and non-assessable, under Delaware law;
J. The execution, delivery and performance of this Agreement
will have been duly authorized prior to the Closing Date by all
necessary corporate action on the part of FICP Government, and
this Agreement constitutes the valid and binding obligation of
FICP Government enforceable in accordance with its terms;
K. The FICP Government Class A Shares to be issued and
delivered to FMMT Government pursuant to the terms of this
Agreement will at the Closing Date have been duly authorized
and, when so issued and delivered, will be duly and validly
issued Class A Shares of FICP Government, fully paid and non-
assessable under Delaware law;
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<PAGE>
L. On the effective date of the Registration Statement, at the
time of the meeting of FMMT Government's shareholders, and on
the Closing Date, the Registration Statement (i) will comply in
all material respects with the provisions of the 1933 Act, the
1934 Act, and the 1940 Act and the rules and regulations
thereunder, and (ii) will not contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading; provided, however, that the representations and
warranties in this subsection shall not apply to statements in
or omissions from the Registration Statement made in reliance
upon and in conformity with information furnished by FMMT
Government for use in the Registration Statement;
M. The information to be furnished by FICP Government for use
in applications for orders, registration statements, proxy
materials and other documents which may be necessary in
connection with the transactions contemplated hereby shall be
accurate and complete and shall comply in all material respects
with Federal securities and other laws and regulations
applicable thereto;
N. FICP Government agrees to use all reasonable efforts to
obtain the approvals and authorizations required by the 1933
Act, the 1940 Act, and such of the state Blue Sky or securities
laws as it may deem appropriate in order to continue its
operations after the Closing Date;
O. FICP Government will, from time to time, as and when
requested by FMMT Government, execute and deliver or cause to be
executed and delivered, all such assignments and other
instruments, and will take and cause to be taken such further
action as FMMT Government may deem necessary or desirable in
order to vest in and confirm to FMMT Government, title to and
possession of all of the FICP Government's Class A Shares to be
sold, assigned, transferred and delivered hereunder and
otherwise to carry out the intent and purpose of this Agreement;
P. The execution and delivery of this Agreement does not, and
the consummation of the transactions contemplated hereby will
not, conflict with FICP's Trust Instrument or By-Laws, or to
FICP Government's knowledge, any provision of any agreement to
which FICP Government is a party or by which it is bound or, to
the knowledge of FICP Government, result in the acceleration of
any obligations or the imposition of any penalty under any
agreement, judgment or decree to which FICP Government is a
party or by which it is bound;
Q. To FICP Government's knowledge, no consent, approval,
authorization or order of any court or governmental authority is
required for the consummation by FICP Government of the
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transactions contemplated herein, except such as have been
obtained under the 1933 Act, the 1934 Act, and the 1940 Act and
such as may be required under state securities laws; and
5. COVENANTS OF FICP GOVERNMENT AND FMMT GOVERNMENT
1. FICP Government and FMMT Government each covenants to operate
its respective business in the ordinary course between the date
hereof and the Closing Date, it being understood that such ordinary
course of business will include customary dividends and
distributions.
2. FMMT Government covenants to call a shareholder meeting to
consider and act upon this Agreement and to take all other action
necessary to obtain approval of the transactions contemplated herein.
3. FMMT Government covenants that FICP Government Class A Shares to
be issued hereunder are not being acquired for the purpose of making
any distribution thereof other than in accordance with the terms of
this Agreement.
4. FMMT Government covenants that it will assist FICP Government in
obtaining such information as FICP Government reasonably requests
concerning the beneficial ownership of FMMT Government's shares.
5. Subject to the provisions of this Agreement, FICP Government and
FMMT Government each will take, or cause to be taken, all action, and
will do or cause to be done all things, reasonably necessary, proper
or advisable to consummate and make effective the transactions
contemplated by this Agreement.
6. FMMT Government covenants that as promptly as practicable, but
in any case within 180 days after the Closing Date, FICP Government
will be furnished with an analysis of the earnings and profits of
FMMT Government for Federal income tax purposes, which will be
carried over by FICP Government as a result of Section 381 of the
Code, and which will be certified by its Treasurer.
7. FMMT Government will prepare a Prospectus (the Prospectus) which
will include a Proxy Statement (the Proxy Statement), both documents
to be included in a Registration Statement on Form N-14 for Fidelity
Institutional Cash Portfolios (the Registration Statement) in
compliance with the 1933 Act, the 1934 Act, and the 1940 Act in
connection with the special shareholders meeting to consider approval
of this Agreement and the transactions contemplated herein.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF FMMT GOVERNMENT
The obligations of FMMT Government to consummate the transactions
provided for herein shall be subject, at its election, to the
performance by FICP Government of all the obligations to be performed
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<PAGE>
by it hereunder on or before the Closing Date, and, in addition
thereto, the following further conditions:
1. All representations and warranties of FICP Government contained
in this Agreement shall be true and correct in all material respects
as of the date hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the Closing Date
with the same force and effect as if made on and as of the Closing
Date;
2. FICP Government shall have delivered to FMMT Government on the
Closing Date a certificate executed in its name by a duly authorized
officer of FICP, in form and substance satisfactory to FMMT
Government dated as of the Closing Date, to the effect that the
representations and warranties of FICP Government made in this
Agreement are true and correct at and as of the Closing Date except
as they may be affected by the transactions contemplated by this
Agreement, and as to such other matters as FMMT Government shall
reasonably request.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF FICP GOVERNMENT
The obligations of FICP Government to complete the transactions
provided for herein shall be subject, at its election, to the
performance by FMMT Government of all the obligations to be performed
by it hereunder on or before the Closing Date and, in addition
thereto, the following further conditions:
1. All representations and warranties of FMMT Government contained
in this Agreement shall be true and correct in all material respects
as of the date hereof, and except as they may be affected by the
transactions contemplated by this Agreement, as of the Closing Date
with the same force and effect as if made on and as of the Closing
Date;
2. FMMT Government shall have delivered to FICP Government a
statement of its assets and liabilities, together with a list of its
portfolio securities showing the tax costs of such securities by lot,
as of the Closing Date, certified by the Treasurer or Assistant
Treasurer of FMMT Government;
3. FMMT Government shall have delivered to FICP Government on the
Closing Date a certificate executed in its name by a duly authorized
officer of FMMT in form and substance satisfactory to FICP
Government, dated as of the Closing Date, to the effect that the
representations and warranties of FMMT Government made in this
Agreement are true and correct at and as of the Closing Date except
as they may be affected by the transactions contemplated by this
Agreement, and as to such other matters as FICP Government shall
reasonably request.
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<PAGE>
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF FICP GOVERNMENT AND
FMMT GOVERNMENT
The obligations of FMMT Government hereunder are, at the option of
FICP Government, and the obligations of the FICP Government hereunder
are, at the option of FMMT Government, each subject to the further
conditions that on or before the Closing Date:
1. This Agreement and the transactions contemplated herein shall
have been approved by the requisite vote of the holders of the
outstanding shares of beneficial interest of FMMT Government in
accordance with the provisions of the law of business trusts of the
State of Delaware, and certified copies of the resolutions evidencing
such approval shall have been delivered to FICP Government;
2. On the Closing Date, no action, suit or other proceeding shall
be pending before any court or governmental agency in which it is
sought to restrain, prohibit, obtain damages or other relief in
connection with this Agreement or any of the transactions
contemplated herein;
3. All consents of other parties and all other consents, orders and
permits of Federal, state and local regulatory authorities (including
those of the Securities and Exchange Commission and of state Blue Sky
and securities authorities, including no-action" positions of such
Federal or state authorities) deemed necessary by FICP Government or
FMMT Government to permit consummation, in all material respects, of
the transactions contemplated hereby shall have been obtained, except
where failure to obtain any such consent, order or permit would not
involve a risk of a material adverse effect on the assets or
properties of FICP Government or FMMT Government, provided that
either party hereto may for itself waive any of such conditions;
4. The Registration Statement shall have become effective under the
1933 Act and no stop orders suspending the effectiveness thereof
shall have been issued and, to the best knowledge of parties hereto,
no investigation or proceeding for that purpose shall have been
instituted or be pending, threatened or contemplated under the 1933
Act;
5. FMMT Government will declare to shareholders of record, on or
prior to the Closing Date, one or more dividends or distributions
which, together with all previous such dividends or distributions,
shall have the effect of distributing to the shareholders
substantially all of its investment company taxable income and net
realized capital gain, if any, as of the Closing Date;
6. FMMT Government and FICP Government shall have received on or
before the Closing Date an opinion of Kirkpatrick & Lockhart LLP
satisfactory to FMMT Government and FICP Government, that for Federal
income tax purposes:
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<PAGE>
A. The Reorganization will be a reorganization under section
368(a)(1)(C) of the Internal Revenue Code of 1986, as amended
("Code"), and FMMT Government and FICP Government will each be
parties to the reorganization under section 368(b) of the Code.
B. No gain or loss will be recognized by FMMT Government upon
the transfer of substantially all of its assets to FICP
Government in exchange solely for FICP Government Class A Shares
and FICP Government's assumption of FMMT Government's
liabilities followed by the distribution of those FICP
Government Class A Shares to the FMMT Government shareholders in
liquidation of FMMT Government.
C. No gain or loss will be recognized by FICP Government on
the receipt of FMMT Government's assets in exchange solely for
the FICP Government Class A Shares and the assumption of FMMT
Government's liabilities.
D. The basis of FMMT Government's assets in the hands of FICP
Government will be the same as the basis of such assets in FMMT
Government's hands immediately prior to the Reorganization.
E. FICP Government's holding period in the assets to be
received from FMMT Government will include FMMT Government's
holding period in such assets.
F. The FMMT Government shareholders will recognize no gain or
loss on the exchange of the shares of beneficial interest in
FMMT Government ("FMMT Government Shares") for the FICP
Government Class A Shares in the Reorganization.
G. The FMMT Government shareholders' basis in the FICP
Government Shares to be received by them will be the same as
their basis in the FMMT Government Shares to be surrendered in
exchange therefor.
H. The holding period of the FICP Government Class A Shares to
be received by the FMMT Government shareholders will include the
holding period of the FMMT Government Shares to be surrendered
in exchange therefor, provided those FMMT Government Shares were
held as capital assets on the date of the Reorganization.
Notwithstanding anything herein to the contrary, FMMT Government may
not waive the conditions set forth in this Paragraph 8.6.
9. BROKERAGE FEES AND EXPENSES
1. FICP Government and FMMT Government each represents and warrants
to the other that there are no brokers' or finders' fees payable in
connection with the transactions provided for herein.
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<PAGE>
2. Fidelity Management & Research Company will assume expenses
incurred by FMMT and FMMT Government, in connection with entering
into and carrying out the provisions of this Agreement, whether or
not the transactions contemplated hereby are consummated. Such
expenses shall include, without limitation: (i) expenses incurred in
connection with the entering into and the carrying out of the
provisions of this Agreement; (ii) postage; (iii) printing; (iv)
accounting fees; (v) legal fees; and (vi) solicitation costs of the
transactions.
10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
1. FICP Government and FMMT Government agree that neither party has
made any representation, warranty or covenant not set forth herein
and that this Agreement constitutes the entire agreement between the
parties.
2. The representation, warranties, and covenants contained in the
Agreement or in any document delivered pursuant hereto or in
connection herewith shall survive the consummation of the
transactions contemplated hereunder.
11. TERMINATION
This Agreement may be terminated by the mutual agreement of FICP
Government and FMMT Government. In addition, either FICP Government
or FMMT Government may at its option terminate this Agreement at or
prior to Closing Date because:
1. of a material breach by the other of any representation,
warranty, or agreement contained herein to be performed at or prior
to the Closing Date; or
2. a condition herein expressed to be precedent to the obligations
of the terminating party has not been met and it reasonably appears
that it will not or cannot be met.
In the event of any such termination, there shall be no liability for
damages on the part of FICP Government or FMMT Government, or their
respective Trustees or officers.
12. AMENDMENT; WAIVER
1. This Agreement may be amended, modified or supplemented in such
manner as may be mutually agreed upon in writing by the respective
President, any Vice President or Treasurer of FMMT Government, FICP
Government, and FMR; provided, however, that following the
shareholders' meeting called by FMMT Government pursuant to Paragraph
5.2 of this Agreement, no such amendment may have the effect of
changing the provisions for determining the number of Class A Shares
of FICP Government to be paid to FMMT Government shareholders under
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<PAGE>
this Agreement to the detriment of such shareholders without their
further approval.
2. At any time before the Closing Date, FICP Government or FMMT
Government may waive any of the conditions set forth herein, provided
that such waiver will not have a material adverse effect on the
shareholders' interests, and (b) FMMT Government may waive any of the
conditions set forth herein if, interests of such Fund's
shareholders.
13. NOTICES
Any notice, report, or demand required or permitted by any provision
of this Agreement shall be in writing and shall be given by prepaid
telegraph or prepaid certified mail addressed to Fidelity
Institutional Cash Portfolios, Fidelity Money Market Trust, or FMR as
appropriate, 82 Devonshire Street, Boston, Massachusetts 02109,
Attention: Arthur S. Loring.
14. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT
1. This Article and paragraph Headings contained in this Agreement
will have reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
2. This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original.
3. This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts.
4. The parties acknowledge that FICP is a Delaware business trust.
Notice is hereby given that this Agreement is executed on behalf of
the Trust's trustees solely in their capacity as trustees, and not
individually, and that the Trust's obligations under this Agreement
are not binding on or enforceable against any of its trustees,
officers, or shareholders, but are only binding on and enforceable
against the Trust's assets and property. Each party agrees that, in
asserting any rights or claims under this Agreement, it shall look
only to FICP Government's assets and property in settlement of such
rights or claims and not to such trustees or shareholders. Each
party agrees that their obligations hereunder apply only to FMMT
Government and FICP Government, respectively, and not to their
shareholders individually or to the Trustees of FICP or FMMT.
5. This Agreement shall bind and inure to the benefit of the
parties hereto and their respective successors and assigns, but no
assignment or transfer hereof or of any rights or obligations
hereunder shall be made by any party without the written consent of
the other parties. Nothing herein expressed or implied is intended
or shall be construed to confer upon or give any person, firm or
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corporation other than the parties hereto and their respective
successors and assigns any rights or remedies under or by reason of
this Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed by an appropriate officer.
FIDELITY MONEY MARKET TRUST
on behalf of U.S. Government Portfolio
[Signature lines omitted]
FIDELITY INSTITUTIONAL CASH PORTFOLIOS
on behalf of Government
[Signature lines omitted]
FIDELITY MANAGEMENT & RESEARCH COMPANY [Signature lines omitted.]
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FIDELITY INSTITUTIONAL CASH PORTFOLIOS - CLASS A
U.S. Treasury Portfolio
U.S. Treasury Portfolio II
U.S. Government Portfolio
Domestic Money Market Portfolio
82 DEVONSHIRE STREET
BOSTON, MASSACHUSETTS 02109
Money Market Portfolio
PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION
Fidelity Institutional Cash Portfolios (the Fund) offers investors a
convenient and economical way to invest in professionally managed money
market portfolios (the Portfolios). 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
limitations prescribed for the Portfolio.
Each Portfolio is comprised of two classes of shares, Class A and Class B.
Both Classes share a common investment objective and investment portfolio.
Class A shares are offered through this Prospectus and Statement of
Additional Information to institutional and corporate investors. Class B
shares are offered through a separate prospectus.
AN INVESTMENT IN THE PORTFOLIOS IS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT AND THERE CAN BE NO ASSURANCE THAT THE PORTFOLIOS WILL
MAINTAIN A STABLE $1.00 SHARE PRICE.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS O F, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION, NOR ARE THEY INSURED BY THE FDIC. INVESTMENT IN
THE PORTFOLIO(S) INVOLVES INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF
PRINCIPAL.
This Prospectus and Statement of Additional Information is designed to
provide investors with information that they should know before investing.
Please read and retain this document for future reference. The Annual
Report to Shareholders of the Fund is incorporated herein. To obtain
additional copies of this document, please call the number below.
For further information, or assistance in opening a new account, please
call:
NATIONWIDE 800-843-3001
TABLE OF CONTENTS
Summary of Expenses
Fund Summary
Financial Highlights
Investment Objective
Investment Policies, Risks and Limitations
How to Invest, Exchange and Redeem
Distributions and Taxes
Portfolio Transactions
Performance
Management Contracts, Distribution Plans
and Service Agreements
Description of the Fund
Appendix A
Appendix B
Financial Statements 33
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.
SUMMARY OF EXPENSES
The purpose of the table below is to assist investors in understanding the
various costs and expenses that an investor in Class A shares would bear
directly or indirectly. The expense summary format below was developed for
use by all mutual funds to help investors make their investment decisions.
T his expense information should be considered along with
other important information such as each Portfolio's investment objective
and past performance. There are no transaction expenses associated with
purchases, exchanges and redemptions of Class A shares.
A. ANNUAL OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)
FOR CLASS A SHARES OF EACH OF THE PORTFOLIOS:
DOMESTIC
U.S. U.S. U.S. MONEY MONEY
TREASURY TREASURY GOVERNMENT MARKET MARKET
PORTFOLIO PORTFOLIO II PORTFOLIO PORTFOLIO PORTFOLIO
Management Fee .15* .14* .14* .12* .15*
Other Expenses .03 .04 .04 .06 .03
Total Operating
Expenses .18% .18% .18% .18% .18%
* NET OF REIMBURSEMENT
B. EXAMPLE: An investor would pay the following expenses on a $1,000
investment in C lass A Shares of each Portfolio, assuming (1) a
5% annual return and (2) full redemption at the end of each time
period:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
$2 $6 $10 $23
EXPLANATION OF TABLE:
A. ANNUAL OPERATING EXPENSES. Management fees are based on the Portfolios'
historical expenses after reimbursement. Management fees are paid by each
Portfolio to Fidelity Management & Research Company ("FMR" or the
"Adviser") for managing its investments and business affairs. The
Portfolios incur other expenses for maintaining shareholder records,
furnishing shareholder statements and reports, and other services. Subject
to revision upon 90 days' notice to shareholders, FMR has agreed to
r e imburse Class A of each Portfolio if and to the ex te nt that
total operating expenses (excluding interest, taxes, brokerage commissions,
and extraordinary expenses ) exceed an annual rate of .18% of
the average net assets of the Po rtfolio's Class A shares. If FMR had
not reimbursed Class A of each Portfolio, the respective Management Fees
and Total Operating Expenses for Class A shares of the Portfolios
would have been: .20 % and .23 % for U.S. Treasury Portfolio;
.20 % and .24 % for U.S. Treasury Portfolio II; .20 % and
.24 % for U.S. Government Portfolio; .20 % and .26 % for
Domestic Money Market Portfolio; and .20 % and .23 % for Money
Market Portfolio. Please refer to the section: "Management Contracts,
Distribution Plans and Service Agreements" on page for further
information.
B. EXAMPLE OF EXPENSES. The hypothetical example illustrates the expenses
associated with a $1,000 investment in Class A shares 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%. These figures reflect FMR's voluntary
reimbursement of expenses for Class A of each Portfolio. THE RETURN OF
5% AND EXPENSES SHOULD NOT BE CONSIDERED INDICATIONS OF ACTUAL OR EXPECTED
CLASS A PERFORMANCE OR EXPENSES, BOTH OF WHICH MAY VARY.
FUND SUMMARY
INVESTMENT OBJECTIVE AND POLICIES. Fidelity Institutional Cash Portfolios,
an open-end management investment company, offers institutional and
corporate investors a convenient and economical way to invest in a choice
of five professionally managed money market portfolios. 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 limitations prescribed for the Portfolio.
U.S. TREASURY PORTFOLIO AND U.S. TREASURY PORTFOLIO II. Comprised of
obligations which are issued or guaranteed as to principal and interest by
the U.S. government and thus constitute direct obligations of the United
States of America.
U.S. GOVERNMENT PORTFOLIO. Comprised of obligations issued or guaranteed as
to principal and interest by the U.S. government, its agencies or
instrumentalities (U.S. government obligations).
DOMESTIC MONEY MARKET PORTFOLIO. Comprised of highest quality, U.S.
dollar-denominated money market obligations of domestic issuers only. Under
normal conditions more than 25% of the Portfolio's total assets will be
invested in obligations of companies in the financial services industry.
MONEY MARKET PORTFOLIO. Comprised of a broad range of high quality ,
U.S. dollar-denominated money market obligations of domestic and foreign
issuers. Under normal conditions , more than 25% of the Portfolio's
total assets will be invested in obligations of companies in the financial
services industry.
Each Portfolio may engage in repurchase agreements and reverse repurchase
agreements; however, U.S. Treasury Portfolio II does not currently intend
to engage in reverse repurchase agreements. Domestic Money Market Portfolio
and Money Market Portfolio may purchase restricted securities. Other
permitted investments of these two Portfolios include bankers' acceptances,
certificates of deposit, time deposits and commercial paper . All five
Portfolio s may invest in variable rate obligations. See
"Investment Policies , Risks and Limitations, " page ,
for further information on each Portfolio's permitted investments.
INVESTING IN THE FUND. The Portfolios' Class A shares may be
purchased at the next determined net asset value per Class A share
(NAV). Each Portfolio requires a minimum initial investment of $5
million. Additional investments may be made in any amount. For
immediate acceptance of purchase orders, federal funds must be transmitted.
See "How to Invest," page .
REDEMPTION OF INVESTMENT. Investors may redeem all or any part of the value
of their accounts by instructing a Portfolio to redeem Class A
shares as described under "How to Redeem" on page . Redemptions may be
requested by telephone and are effected at the NAV next determined after
receipt and acceptance of the request. Amounts will be redeemed by
wire to the investor's designated bank account.
INVESTMENT ADVISER. F M R is the investment adviser to each
Portfolio . FMR, one of the largest investment management organizations
in the U nited S tates , serves as investment adviser to
investment companies which had aggregate net assets of more than $225
billion and approximately 15 million shareholder accounts as of April 30,
1994. FMR has entered into a sub-advisory agreement with FMR Texas Inc.
(FMR Texas), a subsidiary of FMR, pursuant to which FMR Texas has primary
responsibility for providing investment management services to each
Portfolio. See "Management Contracts, Distribution Plans and Service
Agreements," page .
FINANCIAL HIGHLIGHTS
The following tables give information about each Portfolio's
financial history. They use the Portfolios' fiscal year (which ends March
31) and express the information in terms of a single share outstanding
throughout the periods shown. The per-share data and ratios have been
audited by Price Waterhouse, independent accountants. Their unqualified
report is included on page 57 .
U.S. TREASURY PORTFOLIO**
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Years Ended March 31, November 9,
1985
(Commencement
of Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986
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
of period
Income from Investment
.030 .035 .053 .076 .088 .079 .065 .062 .030
Operations
Net interest income
Less Distributions
(.030) (.035) (.053) (.076) (.088) (.079) (.065) (.062) (.030)
From net interest income
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.08% 3.51% 5.48% 7.89% 9.15% 8.17% 6.65% 6.36% 3.02%
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period (000
$ 1,611,877 $ 2,036,806 $ 2,629,072 $ 1,782,957 $ 1,721,126 $ 1,179,620 $ 650,114 $ 637,115 $ 239,945
omitted)
Ratio of expenses to average
.18% .18% .18% .18% .20% .20% .20% .20% .20%*
net assets (dagger)(dagger)
Ratio of expenses to average
.23% .23% .25% .24% .25% .26% .23% .25% .34%*
net assets before expense
reductions (dagger)(dagger)
Ratio of net interest income
3.03% 3.46% 5.29% 7.57% 8.72% 8.06% 6.45% 6.13% 7.56%*
to average net assets
</TABLE>
* ANNUALIZED
** AS OF MARCH 31, 1994, CLASS B SHARES FOR U.S. TREASURY PORTFOLIO, U.S.
GOVERNMENT PORTFOLIO, AND DOMESTIC MONEY MARKET PORTFOLIO WERE NOT
OPERATIONAL.
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED
AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE
PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C>
U.S. TREASURY PORTFOLIO II - CLASS A February 2, 1987
(Commencement
Years Ended March 31, of
Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987
SELECTED PER-SHARE DATA
Net asset value, beginning of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from
Investment Operations
Net interest income
.030 .034 .053 .076 .088 .078 .064 .009
Less Distributions
From net interest income
(.030) (.034) (.053) (.076) (.088) (.078) (.064) (.009)
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.06% 3.46% 5.41% 7.87% 9.13% 8.11% 6.60% .93%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period
$ 4,551,918 $ 5,589,663 $ 5,476,852 $ 3,281,686 $ 1,481,324 $ 658,068 $ 379,501 $ 26,314
(000 omitted)
Ratio of expenses to average
.18% .18% .18% .18% .19% .20% .20% .20%*
net assets (dagger)(dagger)
Ratio of expenses to average net
.24% .23% .25% .25% .27% .26% .32% .99%*
assets before expense
reductions (dagger)(dagger)
Ratio of net interest income to
3.01% 3.38% 5.12% 7.50% 8.63% 7.92% 6.46% 6.11%*
average net assets
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED
AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE
PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
U.S. TREASURY PORTFOLIO II - CLASS B
<TABLE>
<CAPTION>
<S> <C>
October 22,
1993
(Commencement
of
Operations) to
March 31, 1994
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000
Income from Investment Operations
Net interest income .012
Less Distributions
From net interest income (.012)
Net asset value, end of period $ 1.000
TOTAL RETURN (dagger) 1.21%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 5,175
Ratio of expenses to average net assets (dagger)(dagger) .50%*
Ratio of expenses to average net assets before expense reductions (dagger)(dagger) .56%*
Ratio of net interest income to average net assets 2.69%*
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED
AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE
PERIOD SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. GOVERNMENT PORTFOLIO** July 25, 1985
(Commencement
Years Ended March 31, of
Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986
SELECTED PER-SHARE DATA
Net asset value, beginning of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from Investment
.031 .035 .054 .077 .088 .079 .068 .063 .053
Operations
Net interest income
Less Distributions
(.031) (.035) (.054) (.077) (.088) (.079) (.068) (.063) (.053)
From net interest income
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.13 3.56 5.55 7.94 9.15 8.19 6.98 6.51 5.47%
% % % % % % % %
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period (000
$ 3,764,544 $ 5,686,166 $ 4,603,781 $ 3,613,838 $ 2,815,622 $ 1,918,342 $ 1,878,786 $ 1,358,659 $ 511,720
omitted)
Ratio of expenses to average
.18 .18 .18 .18 .20 .20 .20 .20 .20%*
net% % % % % % % %
assets (dagger)(dagger)
Ratio of expenses to average
.24 .24 .25 .25 .25 .24 .23 .25 .30%*
net assets before expense
% % % % % % % %
reductions (dagger)(dagger)
Ratio of net interest income to
3.07 3.50 5.33 7.62 8.74 7.90 6.78 6.28 7.81%*
average net assets
% % % % % % % %
</TABLE>
* ANNUALIZED
** AS OF MARCH 31, 1994, CLASS B SHARES FOR U.S. TREASURY PORTFOLIO, U.S.
GOVERNMENT PORTFOLIO, AND DOMESTIC MONEY MARKET PORTFOLIO WERE NOT
OPERATIONAL.
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED
AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE
PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
DOMESTIC MONEY MARKET PORTFOLIO** Years Ended March 31 November 3,
1989
(Commencement
of
Operations) to
March 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 .031 .034 .054 .078 .035
Net interest income
Less Distributions (.031) (.034) (.054) (.078) (.035)
From net interest income
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger) 3.14% 3.50% 5.50% 8.11% 3.52%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 656,976 $ 804,354 $ 558,727 $ 355,369 $ 330,974
Ratio of expenses to average net
assets (dagger)(dagger) .18% .18% .18% .18% .06%*
Ratio of expenses to average net assets
before expense reductions (dagger)(dagger) .26% .26% .29% .30% .43%*
Ratio of net interest income to average
net assets 3.09% 3.43% 5.24% 7.79% 8.44%*
</TABLE>
* ANNUALIZED
** AS OF MARCH 31, 1994, CLASS B SHARES FOR U.S. TREASURY PORTFOLIO, U.S.
GOVERNMENT PORTFOLIO, AND DOMESTIC MONEY MARKET PORTFOLIO WERE NOT
OPERATIONAL.
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED
AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE
PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C>
MONEY MARKET PORTFOLIO - CLASS A July 5, 1985
(Commencemen
Years Ended March 31, t of
Operations) to
March 31,
1994 1993 1992 1991 1990 1989 1988 1987 1986
SELECTED PER-SHARE DATA
Net asset value, beginning of
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from Investment
Operations
Net interest income
.032 .035 .055 .078 .089 .080 .069 .064 .059
Less Distributions
From net interest income
(.032) (.035) (.055) (.078) (.089) (.080) (.069) (.064) (.059)
Net asset value, end of period
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN (dagger)
3.20 3.58 5.59 8.13 9.25 8.35 7.14 6.57 6.01%
% % % % % % % %
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period (000
$ 3,200,277 $ 4,332,995 $ 3,990,395 $ 4,706,936 $ 4,127,879 $ 2,627,450 $ 2,524,767 $ 1,569,199 $ 960,784
omitted)
Ratio of expenses to average
.18 .18 .18 .18 .20 .20 .20 .20 .19%*
net % % % % % % % %
assets (dagger)(dagger)
Ratio of expenses to average
.23 .23 .24 .25 .24 .24 .23 .23 .28%*
net assets before
% % % % % % % %
expense reductions (dagger)(dagger)
Ratio of net interest income to
3.15 3.50 5.42 7.80 8.82 8.11 6.95 6.33 7.97%*
average net assets
% % % % % % % %
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED
AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE
PERIODS SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
MONEY MARKET PORTFOLIO - CLASS B
<TABLE>
<CAPTION>
<S> <C>
November 17,
1993
(Commencement
of
Operations) to
March 31, 1994
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 1.000
Income from Investment Operations
Net interest income .011
Less Distributions
From net interest income (.011)
Net asset value, end of period $ 1.000
TOTAL RETURN (dagger) 1.08%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 89,463
Ratio of expenses to average net assets (dagger)(dagger) .50%*
Ratio of expenses to average net assets before expense reductions (dagger)(dagger) .55%*
Ratio of net interest income to average net assets 2.83%*
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED
AND WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE
PERIOD SHOWN.
(dagger)(dagger) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
INVESTMENT OBJECTIVE
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 the Portfolio. There is no
assurance that a Portfolio will achieve its investment objective.
INVESTMENT POLICIES, RISKS AND LIMITATIONS
The Fund consists of five individual Portfolios, differentiated in terms of
their permitted investments or investment techniques. Each Portfolio seeks
to maintain a $1.00 share price at all times. The permitted investments of
the Portfolios are as follows:
U.S. TREASURY PORTFOLIO (TREASURY PORTFOLIO) currently maintains an
operating policy of investing at least 65% of its total assets in U.S.
Treasury bills, notes and bonds and repurchase agreements backed by those
obligations. The balance of its assets may be invested in other direct
obligations of the United States.
U.S. TREASURY PORTFOLIO II (TREASURY PORTFOLIO II) currently maintains
an operating policy of investing 100% of its total assets in U.S. Treasury
bills, notes and bonds and other direct obligations of the U.S. Treasury.
The Portfolio may also engage in repurchase agreements backed by those
obligations.
(solid bullet) Each of the above operating policies for Treasury Portfolio
and Treasury Portfolio II may be changed upon 90 days' notice to
shareholders. In the case of such notification, each Portfolio would be
permitted to invest 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. Direct U.S. government obligations
include such instruments as U.S. Treasury bills, notes and bonds and
instruments issued by such Federal agencies as the Export-Import Bank of
the U nited States , the General Services Administration, the
Government National Mortgage Association, the Small Business Administration
and the Washington Metropolitan Area Transit Authority. The Portfolios will
not invest in securities issued or guaranteed by U.S. government agencies,
instrumentalities, or government-sponsored enterprises that are not backed
by the full faith and credit of the United States .
U.S. GOVERNMENT PORTFOLIO (GOVERNMENT PORTFOLIO) invests in U.S. government
obligations issued or guaranteed as to principal and interest by the U.S.
government, including bills, notes, bonds and other U.S. Treasury debt
securities; and instruments issued by U.S. government instrumentalities or
agencies (agency obligations). These instruments include:
(solid bullet) obligations of the Federal Home Loan Banks, Federal Farm
Credit Banks, and Federal National Mortgage Association, which are backed
only by the right of the issuer to borrow from the U.S. Treasury under
certain circumstances or are backed by the credit of the agency or
instrumentality issuing the obligation. Such agency obligations are not
deemed direct obligations of the United States, and therefore involve more
risk.
DOMESTIC MONEY MARKET PORTFOLIO (DOMESTIC PORTFOLIO) invests in U.S.
dollar-denominated money market instruments of domestic issuers rated in
the highest rating category by at least two nationally recognized rating
services, or by one if only one rating service has rated an obligation. The
Portfolio may purchase unrated obligations determined to be of equivalent
quality pursuant to procedures adopted by the Board of Trustees. The
Portfolio's investments include:
(solid bullet) obligations of companies in the financial services industry,
including domestic banks, savings and loan associations, consumer and
industrial finance companies, securities brokerage companies and a variety
of firms in the insurance field. (These obligations include time deposits,
certificates of deposit, bankers' acceptances and commercial paper.) Under
normal conditions, the Portfolio will invest more than 25% of its total
assets in obligations of companies in the financial services
industry ;
(solid bullet) obligations of governments and their agencies and
instrumentalities ;
(solid bullet) short-term corporate obligations, including commercial
paper, notes and bonds ; and
(solid bullet) other short-term debt obligations.
MONEY MARKET PORTFOLIO invests in high quality, U.S. dollar-denominated
money market instruments of domestic and foreign issuers, such as:
(solid bullet) obligations of companies in the financial services industry,
including U.S. branches of both foreign and domestic banks, savings and
loan associations, consumer and industrial finance companies, securities
brokerage companies and a variety of firms in the insurance field. (These
obligations include time deposits, certificates of deposit, bankers'
acceptances and commercial paper.) Under normal conditions, the Portfolio
will invest more than 25% of its total assets in obligations of companies
in the financial services industry ;
(solid bullet) obligations of governments and their agencies and
instrumentalities ;
(solid bullet) short-term corporate obligations, including commercial
paper, notes and bonds ; and
(solid bullet) other short-term debt obligations.
To the extent that either Domestic Portfolio or Money Market Portfolio
invests more than 25% of its assets in obligations of companies in the
financial services industry, it will be exposed to greater risks associated
with that industry as a whole. Domestic Portfolio and Money Market
Portfolio may invest in restricted securities. In addition, Money Market
Portfolio may invest in obligations of U.S. banks, foreign branches of U.S.
and foreign banks (Eurodollars), and U.S. branches and agencies of
foreign banks (Yankee dollars). Eurodollar and Yankee dollar investments
involve risks that are different from investments in securities of U.S.
banks. (See Appendix A. )
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 some of the Portfolios may
follow more restrictive policies as described above.
(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: a U.S. government security; 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 have received the highest rating (e.g.,
S&P A-1 rating) from at least two rating services (or one, if only one has
rated the security). Second tier securities have received ratings within
the two highest categories (e.g., S&P A-1 or A-2) from at least two rating
services (or one, if only one has rated the security), but do not qualify
as first tier securities. If a security has been assigned different ratings
by different rating services, at least two rating services must have
assigned the higher rating in order for FMR to determine eligibility on the
basis of that higher rating. Based on procedures adopted by the Board of
Trustees, FMR may determine that an unrated security is of equivalent
quality to a security rated first or second tier.
Money Market Portfolio may not invest more than 5% of its total assets in
second tier securities. In addition, 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.
(solid bullet) MATURITY. Each Portfolio must limit its investments to
securities with remaining maturities of 397 days or less and must maintain
a dollar-weighted average maturity of 90 days or less.
(solid bullet) DIVERSIFICATION. Neither Domestic Money Market
Portfolio, nor Money Market Portfolio may invest more than 5% of its
total assets in the securities (other than U.S. government securities) of
any single issuer. 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 days.
INVESTMENT TECHNIQUES. Each Portfolio may engage in repurchase agreements
with respect to any category of securities in which it is entitled to
invest, even if the maturity of these securities is greater than 397
days . Each Portfolio, except Treasury Portfolio II, also may engage in
reverse repurchase agreements to raise cash temporarily or to attempt to
increase income. Shareholders of Treasury Portfolio II will be notified
should the Portfolio change its policies concerning reverse repurchase
agreements.
See Appendix A on page 28 for further information on the Portfolios'
investment techniques, including repurchase and reverse repurchase
agreements, and Appendix B on page for a description of rating
categories.
The investment objective and policies set forth above are supplemented by
each Portfolio's investment limitations beginning below . Each
Portfolio's objective is fundamental; however, its investment policies and
limitations, unless otherwise indicated, are not fundamental, and may be
changed without shareholder approval.
SUITABILITY
The Fund is designed as an economical and convenient vehicle for those
institutional and corporate investors with cash balances or cash reserves
seeking to obtain the yields available from money market instruments while
maintaining liquidity. The ability to select from among the Portfolios
allows investors to choose that Portfolio, or combination of Portfolios,
which best suits their particular investment goals.
Each Portfolio's ability to achieve its investment objective depends on the
quality and maturity of its investments. Although the Portfolios'
investment policies are designed to 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 a 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 vulnerable to price
changes, although they may provide higher yields.
The Portfolios offer the advantages of large purchasing power and
diversification. Generally, in purchasing money market instruments from
dealers, the percentage difference between the bid and asked prices tends
to decrease as the size of the transaction increases. The Portfolios
also offer investors the opportunity to participate in a portfolio of money
market instruments which is more diversified in terms of issuers and
maturities than the size the investor's investment might otherwise permit.
Investment in a Portfolio relieves the investor of many management
and administrative burdens usually associated with the direct purchase and
sale of money market instruments. These include selection of 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
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 a 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.
The Portfolios' 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) of the
Portfolios. However, except for the fundamental investment limitations set
forth below, the investment policies and limitations described in this
combined Prospectus and Statement of Additional Information are not
fundamental and may be changed without shareholder approval. THE FOLLOWING
ARE THE PORTFOLIOS' FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH IN THEIR
ENTIRETY. EACH PORTFOLIO MAY NOT:
(1) 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 5% of
its total assets would be invested in the securities of such issuer,
provided, however, that with respect to 25% of its total assets, 10% of its
assets may be invested in the securities of an 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 value 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 the Portfolio's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry, except that Domestic
Portfolio and Money Market Portfolio will invest more than 25% of its total
assets in the financial services industry;
(6) buy or sell real estate;
(7) 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
limitation does not apply to purchases of debt securities or to repurchase
agreements;
(8) invest in oil, gas, or other mineral exploration or development
programs; or
(9) invest in companies for the purpose of exercising control or
management.
(10) Each 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.
THE FOLLOWING LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE CHANGED WITHOUT
SHAREHOLDER APPROVAL:
(i) Domestic Portfolio and Money Market Portfolio each do 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) Each 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) Each 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.
(iv) Each 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. Each Portfolio will not purchase any security
while borrowings (excluding reverse repurchase agreements) representing
more than 5% of its total assets are outstanding. Each 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. Treasury Portfolio II does not currently
intend to engage in reverse repurchase agreements.
(v) Each 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.
(vi) Subject to 60 days' notice to its shareholders, each 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) Domestic Portfolio and Money Market Portfolio do not currently intend
to lend assets other than securities to other parties, except by lending
money (up to 10% of each 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) Each 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 a reorganization,
consolidation, or merger.
(ix) Treasury Portfolio, Treasury Portfolio II and Government Portfolio do
not currently intend to make loans, but this limitation does not apply to
purchases of debt securities or to repurchase agreements.
(x) Each Portfolio does not currently intend to invest in securities of
real estate investment trusts that are not readily marketable, or to invest
in securities of real estate limited partnerships that are not listed on
the New York Stock Exchange or the American Stock Exchange or traded on the
NASDAQ National Market System.
(xi) Each Portfolio does not currently intend to purchase the securities of
any issuer if those officers and Trustees of the Fund 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.
(xii) Each Portfolio does not currently intend to invest in oil, gas, or
other mineral exploration or development programs or leases.
(xiii) Each Portfolio does not currently intend to 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.
HOW TO INVEST, EXCHANGE AND REDEEM
Class A s hares 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 Class A shares, although institutions may charge
their clients fees in connection with purchases and sales for the accounts
of their clients. Investments in the Portfolios must be made using the
Federal Reserve Wire System. Checks will not be accepted as a means of
investment.
SHARE PRICE AND DIVIDENDS. The NAV for Class A shares of Treasury
Portfolio, Government Portfolio, Domestic Money Market Portfolio, and Money
Market Portfolio is determined by Fidelity Service Co. (Service), 82
Devonshire Street, Boston, MA 02109 as of 3:00 p.m . Eastern time,
each day the Portfolios are open for business. (See "Holiday Schedule" on
page .) The NAV for Class A shares of Treasury Portfolio II will be
determined at 3:00 p.m. and 5:00 p.m. Eastern time. Shareholders of record
as of 3:00 p.m. (5:00 p.m. for Treasury Portfolio II) will be entitled to
that day's dividend. The NAV is determined by adding the value of all
securities and other assets of Class A of the Portfolio, deducting
the actual and accrued liabilities allocated to Class A
shares , and dividing by the number of Class A shares
outstanding. (See "How Net Asset Value is Determined" on page ).
Class A's net interest income for dividend purposes is determined by
Service on a daily basis and shall be declared to shareholders of record at
the time of its declaration (including, for this purpose, holders of shares
purchased, but excluding holders of shares redeemed on that day). The
dividend declared for Treasury Portfolio II is based on estimates of net
interest income for the Portfolio. Actual income may differ from estimates
and differences, if any, will be included in the calculation of subsequent
dividends. Income dividends declared are accrued daily throughout the
month and are distributed in the form of full and fractional Class A
shares on the first business day of the following month. Based on prior
approval of the Fund, dividends relating to Class A shares redeemed
during the month can be distributed in the form of full and fractional
Class A shares on the day of redemption. The Fund reserves the right
to limit this service. The shareholder may elect to receive monthly
dividends in cash.
MINIMUM INVESTMENT AND ACCOUNT BALANCE. The minimum initial investment to
establish a new account in Class A shares of each Portfolio is $ 5
million . Subsequent investments may be made in any amount. To keep an
account open, please leave $5 million in it. If an account balance
falls below $5 million due to redemption, the account may be closed
and the proceeds wired to the bank account of record. An investor will be
given 30 days' notice that the account will be closed unless an additional
investment is made to increase the account balance to the $5 million
minimum.
HOW TO INVEST. An initial investment in Class A of a Portfolio must
be preceded or accompanied by a completed, signed application. Unless you
already have a Fidelity mutual fund account, you must complete and sign the
application. The application should be forwarded to:
Fidelity Client Services
c/o Fidelity Institutional Cash Portfolios
FIIOC, ZR5
P.O. Box 1182
Boston, MA 02103-1182
An investor must purchase Class A shares of each Portfolio by wire.
For wiring information and instructions, investors should call the
institution through which they trade or Fidelity Client Services. There is
no charge imposed by the Fund for the wire; however, banks may charge a fee
for this service.
In order to receive same day acceptance of the investment, investors must
telephone Institutional Trading before 3:00 p.m., Eastern time, on days the
Portfolios are open for business, to advise them of the wire and to place
the trade.
In order to receive same day acceptance of investment in Treasury
Portfolio II after 3:00 p.m., investors must telephone Institutional
Trading before 5:00 p.m. Eastern time to place the trade and must obtain a
wire reference number for each trade. It is necessary to obtain a new wire
reference number for each purchase placed in the Portfolio after 3:00 p.m.
Eastern time. Wire reference numbers are assigned exclusively by means of
telephone communication and are effective for one transaction only and may
not be used more than once. WIRED MONEY FOR PURCHASES PLACED AFTER 3:00
P.M. THAT IS NOT PROPERLY IDENTIFIED WITH A CURRENTLY EFFECTIVE WIRE
REFERENCE NUMBER WILL BE RETURNED TO THE BANK FROM WHICH IT WAS WIRED AND
WILL NOT BE CREDITED TO THE SHAREHOLDER'S ACCOUNT.
FIDELITY CLIENT SERVICES:
NATIONWIDE 800-843-3001
INSTITUTIONAL TRADING:
NATIONWIDE 800-343-6310
IN MASSACHUSETTS 800-462-2603
Investors will be entitled to the dividend declared on Class A shares
by a Portfolio provided the Portfolio's custodian bank receives the
wire by the close of the Federal Reserve Wire System on the day the
purchase order is accepted. Investors are advised to wire funds as early in
the day as possible, and to provide advance notice to Institutional Trading
for large transactions.
HOW TO EXCHANGE. Each Portfolio's Class A shares may be exchanged
(subject to the minimum initial investment requirement) at no charge for
Class A shares of any other Portfolio of the Fund or for shares of Fidelity
Institutional Tax-Exempt Cash Portfolios, provided the portfolio to be
acquired is registered in an investor's state. Investors whose orders to
exchange out of Treasury Portfolio II are received between 3:00 and 5:00
p.m. may not be invested for one day, depending on the time at which orders
are accepted by the portfolio into which they are exchanging. You may
only exchange 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.
Investors should consult the prospectus of the portfolio to be acquired to
determine eligibility and suitability.
TO EXCHANGE BY TELEPHONE. Exchanges may be requested on any day the
Portfolios are open for business by calling Institutional Trading before
3:00 p.m. Eastern time (5:00 p.m. for Treasury Portfolio II) at the
numbers listed above .
TO EXCHANGE BY MAIL. Written requests for exchanges should contain the
Portfolio name, account number, and number of Class A shares to be
redeemed, and the name of the portfolio to be purchased. The letter
must be signed by a person authorized to act on the account and must
include a signature guarantee. 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
associations, clearing agencies and savings associations. Letters should be
sent to Fidelity Client Services at the address shown above .
An exchange involves the redemption of all or a portion of the shares of
one portfolio and the purchase of shares of another portfolio.
Class A s hares will be redeemed at the next determined NAV following
receipt of the exchange order. S hares of the portfolio to be
acquired will be purchased at their next determined NAV after
redemption proceeds are made available. Investors will earn dividends in
the acquired portfolio in accordance with the portfolio's customary policy,
normally on the day the exchange request is received. Investors should note
that under certain circumstances, a Portfolio may take up to seven days to
make redemption proceeds available for the exchange purchase of another
p ortfolio.
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 a Portfolio's exchange privilege. Under Rule 11a-3, 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) a p ortfolio suspends the redemption of the shares
to be exchanged as permitted under the 1940 Act or the rules and
regulations thereunder, or the p ortfolio to be acquired suspends
sale of its shares because it is unable to invest amounts effectively in
accordance with its investment objective and policies.
E ach 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 might otherwise be adversely affected.
The exchange privilege may be modified or terminated in the future.
HOW TO REDEEM. Shareholders may redeem all or any part of the value of
their account(s) on any business day. Redemptions may be requested by
telephone and are effected at the NAV next determined after receipt of the
redemption request.
Shareholders must designate on their applications their U.S. commercial
bank account(s) into which they wish the proceeds of redemptions to be
deposited. A shareholder may change the bank account(s) designated to
receive amounts redeemed at any time prior to making a redemption request.
A letter of instruction, including a signature guarantee, should be sent to
Fidelity Client Services at the address shown above .
Redemption proceeds will be wired via the Federal Reserve Wire System to a
bank account of record on the same day a redemption request is received,
provided it is made before 3:00 p.m. Eastern time. In the case of
Treasury Portfolio II, redemption proceeds will be wired via the Federal
Reserve Wire System to a bank account of record on the same day a
redemption request is received, provided it is received before 5:00 p.m.
Eastern time. Class A s hares redeemed will not receive the dividend
declared on the day of redemption. Redemption requests can be made by
calling Institutional Trading . There is no charge imposed for wiring of
redemption proceeds.
If Class A shares redeemed represent an investment made via clearing
house funds, each Portfolio reserves the right to withhold the redemption
proceeds until it is reasonably assured of the crediting of such funds to
its account.
Under the 1940 Act, the right of redemption may be suspended or the date of
payment postponed for more than seven days at times when the New York Stock
Exchange (NYSE) is closed, other than customary weekend or holiday
closings, or when trading on the NYSE is restricted, or under certain
emergency circumstances as determined by the S ecurities and Exchange
Commission (SEC) . If investors are unable to execute a transaction by
telephone (for example, during time of unusual market activity) they may
consider placing their orders by mail. In case of the suspension of the
right of redemption, investors may either withdraw their requests for
redemption or receive payment based on the NAV next determined after
termination of the suspension.
ADDITIONAL INFORMATION. Investors may initiate many transactions by
telephone. Note that Fidelity will not be responsible for any losses
resulting from unauthorized transactions if it follows reasonable
procedures designed to verify the identity of the caller. Fidelity will
request personal information for security purposes , and may also record
calls. Investors should verify the accuracy of their confirmation
statements immediately after receiving them. Investors that do not
want the ability to redeem and exchange by telephone should call
Fidelity for instructions.
To allow the Adviser to manage the Portfolios most effectively, investors
are strongly urged to initiate all trades (investments in , or
exchanges or redemptions of Class A shares) as early in the day
as possible and to notify Fidelity Client Services at least one day in
advance of transactions in excess of $5 million. In making these trade
requests, the name of the registered shareholder and the account number
must be supplied for each transaction. To protect each Portfolio's
performance and shareholders, the Adviser discourages frequent trading in
response to short-term market fluctuations.
In order to invest or redeem from Treasury Portfolio II after 3:00 p.m.,
investors must contact their client service representative one week in
advance to establish the requisite operational requirements for late
trading. Even after these procedures are in place, investors are encouraged
to execute as many trades as possible prior to 3:00 p.m. The Portfolio
reserves the right to refuse any investment that would, in its sole
discretion, be disruptive of the Portfolio's management.
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 the NAV for each Portfolio's Class A shares .
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.
Each Portfolio reserves the right to suspend the offering of Class A
shares for a period of time, and each Portfolio reserves the right to
reject any specific purchase order including certain purchases by exchange.
Purchase orders may be refused if, in FMR's opinion, they are of a size
that would disrupt management of the Portfolios. Each Portfolio may
discontinue offering its shares at any time or in any particular state
without notice to shareholders.
INVESTOR ACCOUNTS. Fidelity Investments Institutional Operations Company
(FIIOC) is the transfer, dividend disbursing and shareholder servicing
agent for the Fund and maintains an account for each investor expressed in
terms of full and fractional Class A shares of each Portfolio
rounded to the nearest 1/1000th of a share.
The Fund does not issue share certificates, but FIIOC will send investors a
confirmation statement after every transaction (except a reinvestment of
dividends or capital gains) that affects the Class A share balance
or the account registration. After the end of each month, FIIOC will send
each investor a statement setting forth the transactions in their account
for the month and the month-end balance of full and fractional Class A
shares held in the 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 will 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.
HOLIDAY SCHEDULE. Each Portfolio is open for business and its Class A
NAV is calculated every 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 scheduled for 1994: Dr. Martin
Luther King, Jr. Day (observed), Presidents' Day, Good Friday, Memorial
Day, Independence Day (observed), Labor Day, Columbus Day, Veterans' Day,
Thanksgiving Day and Christmas Day (observed). Although FMR expects the
same holiday schedule, with the addition of New Year's Day, to be observed
in the future, the New York Fed or the NYSE may modify its holiday
schedule at any time. The right is reserved to advance the time on that day
by which purchase and redemption orders must be received on any day that:
(1) the New York Fed or the NYSE closes early or, in the case of
Treasury Portfolio II, the principal government securities markets close
early, such as on days in advance of holidays generally observed by
participants in such markets; (2) if , in FMR's judgment, early
closing is deemed to be in the best interest of each Portfolio's
shareholders; or, (3) as permitted by the SEC. To the extent that each
Portfolio's securities are traded in other markets on days the New
York Fed or the NYSE is closed, each Portfolio's Class A NAV may
be affected when investors do not have access to the Portfolio to purchase
or redeem Class A shares. Certain Fidelity funds may follow
different holiday closing schedules.
HOW NET ASSET VALUE IS DETERMINED. 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
a Portfolio would receive if it sold the instrument.
Valuing a 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 Portfolios must adhere to certain conditions under Rule 2a-7; these
conditions are summarized under "Regulatory Requirements" on page 9 .
The Board of Trustees of the Fund oversees FMR's adherence to SEC rules
concerning money market funds, and has established procedures designed to
stabilize each Portfolio's NAV for each class at $1.00. At such intervals
as they may deem appropriate, the Trustees consider the extent to which NAV
calculated by using market valuations would deviate from $1.00. 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 such Portfolio's yield based on
market valuations. Under these circumstances, a shareholder in a 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.
DISTRIBUTIONS AND TAXES
DIVIDENDS. 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.
Dividends from the Portfolios will not normally qualify for the
dividends-received deduction available to corporations, since a Portfolio's
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 each 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 NAV
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 the Portfolios.
FEDERAL TAXES. Dividends derived from net investment income and short-term
capital gains are taxable as ordinary income. Distributions are taxable
when paid, whether investors receive distributions 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 31st. The Portfolios
will send investors an IRS Form 1099-DIV by January 31st showing their
taxable distributions for the past calendar year.
STATE AND LOCAL TAX ISSUES. For mutual funds organized as business trusts,
state law provide s 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, may not
qualify for this pass-through benefit. The tax treatment of your dividend
distributions from the fund will be the same as if you directly owned your
proportionate share of the U.S. government securities in the fund's
portfolio. Because the income earned on most U.S. government securities in
which the fund invests is exempt from state and local income taxes, the
portion of your dividend from the fund 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.
TAX STATUS OF THE FUND. Each Portfolio has qualified and intends to
continue to qualify as a "regulated investment company" under the Internal
Revenue Code of 1986 (the Code), as amended , 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.
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 es , investors may be subject
to state or local taxes on their investment. Investors should consult their
tax advisors to determine whether a Portfolio is suitable to their
particular tax situation.
When investors sign their account application, they will be asked to
certify that their 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 violate IRS regulations, the IRS
can require a Portfolio to withhold 31% of taxable distributions and
redemptions.
Issuers of tax-exempt bonds should note that, although the U.S. Treasury
has adopted rules which allow certain issuers of tax-exempt bonds to take
into account qualified administrative costs in determining payments and
receipts on non-purpose investments, there is no assurance that expenses of
a Portfolio will meet this standard. Such issuers should consult their own
tax counsel before investing.
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 Portfolios on a more
favorable spread than would be possible for most individual investors.
All orders for the purchase or sale of portfolio securities are placed on
behalf of each Portfolio by FMR (either directly or through affiliated
sub-advisers) pursuant to authority contained in each Portfolio's
Management Contract. 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 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 will consider 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 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 Portfolios are placed with
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 is generally
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 and/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), a member of the New York Stock Exchange and a subsidiary of
FMR Corp., if the commissions are fair and 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 Board of Trustees periodically review s FMR's performance
of its responsibilities in connection with the placement of portfolio
transactions on behalf of the Portfolios and review s the commissions
paid by the Portfolios over representative periods of time to determine if
they are reasonable in relation to the benefits to the Portfolios.
From time to time the Board of 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. The Portfolios seek 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
Portfolios to seek such recapture.
Although the Trustees and officers of the Fund are substantially the
same as those of other funds managed by FMR, investment decisions for the
Portfolios 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.
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 a formula considered by the officers of the funds involved to be
equitable to each fund. In some cases this system could have a detrimental
effect on the price or value of the security as far as the Portfolios are
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 the Portfolios
outweighs any disadvantages that may be said to exist from exposure to
simultaneous transactions.
PERFORMANCE
From time to time each Portfolio advertises its YIELD and EFFECTIVE YIELD
in advertisements or in reports or other communications with shareholders.
(Yield and total return figures will differ among each class of a
Portfolio's shares.) Both yield figures are based on historical earnings
and are not intended to indicate future performance. The CURRENT YIELD
refers to the income generated by an investment in a Portfolio over a
seven-day period (which will be stated in the advertisement). 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
current yield because of the compounding effect of this assumed
reinvestment. In addition to the current yield, a Portfolio may quote
yields in advertising based on any historical seven - day period.
The yield and effective yield figures are illustrated below for the
seven-day period ended March 31, 1994.
Class A Class B
Effective Effective
Yield Yield Yield Yield
Treasury Portfolio * 3.32 % 3.38 % - -
Treasury Portfolio II 3.32 % 3.38 % 3.00% 3.04%
Government Portfolio * 3.39 % 3.45 % - -
Domestic Portfolio* 3.39 % 3.45 % - -
Money Market Portfolio 3.48 % 3.54 % 3.16% 3.21%
*Class B not operational during this period.
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. Investors should give
consideration to the quality and maturity of portfolio securities of the
respective investment companies when comparing investments.
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 return 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.
The Portfolios' performance, or the performance of securities in which they
may invest, may be compared to:
(solid bullet) IBC/Donoghue's MONEY FUND AVERAGES (trademark) , which
are average yields of various types of money market funds that include the
effect of compounding distributions, assume reinvestment of distributions,
are reported in IBC/Donoghue's MONEY FUND REPORT (registered
trademark) , and are published by IBC USA (Publications), Inc. of
Ashland, Massachusetts;
(solid bullet) Other mutual funds in general, or to the performance of
specific 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 that 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;
(solid bullet) 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
(solid bullet) Fixed-income investments such as Certificates of Deposit
(CDs).
The principal value and interest rate of CDs and certain other money market
securities are fixed generally 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 also may reference the growth and
variety of money market mutual funds and the Adviser's innovation and
participation in the industry.
Each Portfolio may discuss its fund number, Quotron (trademark)
number, CUSIP number, and current portfolio manager .
From time to time, in reports and promotional literature, each Portfolio's
performance also may be compared to other mutual funds tracked by financial
or business publications and periodicals. For example, each Portfolio may
quote Morningstar, Inc. in its advertising materials. Morningstar, Inc. is
a mutual fund rating service that rates mutual funds on the basis of
risk-adjusted performance. In addition, each 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.
MANAGEMENT CONTRACTS, DISTRIBUTION PLANS AND SERVICE AGREEMENTS
MANAGEMENT CONTRACTS. Each Portfolio employs FMR to furnish investment
advisory and other services to the Portfolio. 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 Portfolio's
investments, and compensates all officers of the Fund, all Trustees who are
"interested persons" of the Fund or of FMR, and all personnel of the Fund
or FMR performing services relating to research, statistical and investment
activities.
In addition, FMR or its affiliates, subject to the supervision of the Board
of Trustees, 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 Fund'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. As described
below, FMR has agreed to limit each Portfolio's expenses.
For these services each Portfolio pays a monthly fee to FMR at the annual
rate of .20% of the average net assets of the Portfolio as determined as of
the close of business on each day throughout the month.
For the fiscal years ended March 31, 1994, 1993, and 1992 , management fees
before reimbursement of expenses were $ 3,796,042 , $5,351,14 5
and $4,236,988 for Treasury Portfolio, $ 9,834,015 , $14,029,197 and
$8,506,023 for Treasury Portfolio II, $ 9,660,519 , $12,610,880 and
$8,576,656 for Government Portfolio, $ 1,525,574 , $1,536,740 and
$1,095,503 for Domestic Portfolio, and $ 10,551,990 , $10,066,276 and
$9,604,202 for Money Market Portfolio, respectively.
In addition to the management fee payable to FMR and the fees payable to
Service and FIIOC, and subject to the reimbursement provisions described
below, each Portfolio pays all its expenses, without limitation, that are
not assumed by those parties. Each Portfolio pays for the typesetting,
printing and mailing of its proxy material to shareholders, and for legal
expenses and the fees of the custodian, auditor and non-interested
Trustees. Other charges paid by each Portfolio include: interest, taxes,
brokerage commissions, the Portfolio's proportionate share of insurance
premiums and Investment Company Institute dues, and the costs of
registering shares under federal and state securities laws. Each Portfolio
also is liable for such nonrecurring expenses as may arise, including costs
of litigation to which the Portfolio is a party and any obligation it may
have to indemnify officers and Trustees with respect to such litigation.
Although each Portfolio's current Management Contract provides that the
Portfolio will pay for typesetting, printing and mailing of Prospectuses,
Statements of Additional Information and reports to existing shareholders,
the Portfolios entered into a revised transfer agent agreement with FIIOC
effective June 1, 1989, pursuant to which FIIOC bears the cost of providing
these services.
FMR has voluntarily agreed to reimburse Class A of each of the
Portfolios if and to the extent that the aggregate operating
expenses of Class A (excluding interest, taxes, brokerage
commissions, and extraordinary expenses) exceed an annual rate of
.18% of the average net assets of Class A for any fiscal year or for
a portion of such year if FMR's agreement is terminated or revised. FMR
retains the ability to be repaid b y Class A of the Portfolios for
these expense reimbursements in the amount that expenses fall below the
limit prior to the end of the fiscal year. FMR will continue this
reimbursement arrangement subject to revision upon 90 days' notice to
shareholders. Such reimbursements have the effect of artificially
decreasing a Portfolio's Class A expenses, thereby increasing
the yield of such Portfolio's Class A shares .
For the fiscal years ended March 31, 1994, 1993, and 1992, aggregate
Class A operating expenses reimbursed by FMR were $ 903,610 ,
$1,246,151, and $1,470,637 for Treasury Portfolio, $ 2,956,232 ,
$3,246,298 and $3,143,538 for Treasury Portfolio II, $ 2,665,587 ,
$3,508,338 and $2,804,357 for Government Portfolio, $ 638,552 ,
$645,507 and $579,020 for Domestic Portfolio, and $ 2,437,428 ,
$2,697,402 and $2,735,714 for Money Market Portfolio, respectively.
SUB-ADVISORY AGREEMENTS. With respect to each Portfolio, FMR has entered
into a sub-advisory agreement with FMR Texas, a Texas corporation with
principal offices at 400 East Las Colinas Boulevard in Irving, Texas.
Pursuant to the agreement, FMR Texas has primary responsibility for
providing portfolio investment management services to each Portfolio, while
FMR retains responsibility for providing other portfolio management
services.
Under each sub-advisory agreement, FMR pays FMR Texas fees equal to 50% of
the management fees payable to FMR under its current 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.
For the fiscal years ended March 31, 1994, 1993, and 1992, fees paid to FMR
Texas by FMR were $ 1,898,021 , $2,675,57 4 and $2,118,494 for
the Treasury Portfolio, $4,917,008 , $7,014,599 and $4,253,012 for
Treasury Portfolio II, $ 4,830,260 , $6,305,440 and $4,288,328 for
Government Portfolio, $ 762,787 , $768,370 and $547,752 for Domestic
Portfolio and $ 5,275,995 , $5,033,138 and $4,802,101 for Money Market
Portfolio, respectively.
CONTRACTS WITH COMPANIES AFFILIATED WITH FMR. FIIOC , 82 Devonshire
Street, Boston, Massachusetts 02109, an affiliate of FMR, is transfer,
dividend-paying and shareholder servicing agent for each Portfolio and
maintains shareholder records.
For institutional client master accounts effective June 1, 1990, FIIOC
receives a per account fee and a monetary transaction fee of $65 and $14,
respectively, or $60 and $12, respectively, depending on the nature of
services provided. Effective January 1, 1993, FIIOC is paid a per account
fee of $95 and a monetary transaction fee of $20 or $17.50 depending on the
nature of the services provided. Fees for institutional retirement plan
accounts, if any, would be based on the NAV of all such accounts in a
Portfolio. In addition, FIIOC pays out-of-pocket expenses associated with
providing transfer agent services and bears the expense of typesetting,
printing and mailing Prospectuses, Statements of Additional Information,
reports, notices and statements to shareholders.
For the fiscal years ended March 31, 1994, 1993, and 1992, transfer agent
fees and expenses were $ 150,635 , $198,961 and $259,235 for Treasury
Portfolio, $ 1,101,750 , $786,114 and $723,978 for Treasury Portfolio
II, $ 878,411 , $889,140 and $726,802 for Government Portfolio,
$ 262,203 , $162,165 and $118,032 for Domestic Portfolio and
$ 515,041 , $591,793 and $680,128 for Money Market Portfolio,
respectively.
The Portfolios' contracts with Service, an affiliate of FMR, provides that
Service will perform the calculations necessary to determine each
Portfolio ' s net asset value per share and dividends and maintain
general accounting records. Prior to July 1, 1991, the annual fee for these
pricing and bookkeeping services was based on two schedules, one pertaining
to each Portfolio's average net assets and one pertaining to the type and
number of transactions a Portfolio made. The fee rates in effect as of July
1, 1991 are based on each Portfolio's average net assets, specifically
.0175% for the first $500 million of average net assets and .0075% for
average net assets in excess of $500 million. The fee is limited to a
minimum of $20,000 and a maximum of $750,000 per year for each Portfolio.
For the fiscal years ended March 31, 1994, 1993, and 1992, fees paid to
Service for pricing and bookkeeping services (including related
out-of-pocket expenses) were $ 192,236 , $251,607 and $210,011 for
Treasury Portfolio, $ 419,147 , $57 6 ,072 and $354,383 for
Treasury Portfolio II, $ 412,411 , $523,696 and $346,477 for
Government Portfolio, $ 107,464 , $108,548 and $95,756 for Domestic
Portfolio and $ 445,362 , $429,428 and $376,076 for Money Market
Portfolio, respectively.
Service also receives fees for administering the Portfolios' securities
lending programs where applicable. Securities lending fees are based on the
number and duration of individual securities loans.
Each Portfolio has a Distribution Agreement with Fidelity Distributors
Corporation (Distributors), an affiliate of FMR. Distributors, a
Massachusetts corporation organized July 18, 1960, is a broker-dealer
registered under the Securities Exchange Act of 1934 and is a member of the
National Association of Securities Dealers, Inc (NASD) . The
Distribution Agreement calls for Distributors to use all reasonable
efforts, consistent with its other business, to secure purchasers for
shares of each Portfolio. Promotional and administrative expenses in
connection with the offer and sale of shares are paid by FMR. Distributors
also acts as general distributor for other publicly offered Fidelity funds.
DISTRIBUTION AND SERVICE PLANS. The Board of Trustees has adopted, on
behalf of Class A of each Portfolio , a Distribution and Service
Plan (each Plan) pursuant to Rule 12b-1 of 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 intended primarily to
result in the sale of shares of the fund except pursuant to a plan adopted
by the fund under the Rule. The Fund's Board of Trustees adopted the Plans
to assure that Class A of each Portfolio and FMR may incur certain
expenses that might be considered to constitute indirect payment by
Class A of the Portfolio of distribution expenses.
Each Plan specifically recognizes that FMR, either directly or through
Distributors, 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 Class A shares of
the Portfolios. In addition, each Plan provides that FMR may use its
resources, including its management fee revenues, to make payments to banks
and other financial intermediaries that provide Class A sales and/or
shareholder support services. The Trustees have not authorized any 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 each Plan
will benefit the Class A shares of the relevant Portfolios and their
shareholders. In particular, the Trustees noted that each Plan does not
authorize payments by Class A shares of a Portfolio other than those
made to FMR under its Management Contract with the Portfolio. To the extent
that the Plans give FMR and Distributors greater flexibility in connection
with the distribution of Class A shares of the Portfolios,
additional sales of each Portfolio's Class A shares may
result. Additionally, certain shareholder support services may be provided
more effectively under the Plans by local entities with whom shareholders
have other relationships.
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, in Distributors' opinion
it should not prohibit banks from being paid for shareholder servicing and
recordkeeping functions. Distributors intends to engage banks only for the
purpose of performing 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, should be taken 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 being 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 Portfolios may
execute portfolio transactions with and purchase securities issued by
depository institutions that receive payments under the Plans. No
preference for the instruments of depository institutions will be
shown in the selection of investments.
DESCRIPTION OF THE FUND
FUND ORGANIZATION. Treasury Portfolio , Treasury Portfolio II ,
Government Portfolio , Domestic Portfolio and Money Market
Portfolio are series of Fidelity Institutional Cash Portfolios,
which is an open-end management investment company organized as a Delaware
b usiness trust on May 30, 1993. The Portfolios acquired all of the
assets of the series of a Massachusetts business t rust,
Fidelity Institutional Cash Portfolios , on May 30, 1993. Currently
there are five Portfolios in the Fund . Each Portfolio currently
offers two c lasses of shares, Class A and Class B. The Trust
Instrument permits the Trustees to create additional series .
Class B shares of each Portfolio are offered to institutional and corporate
investors that invest through a bank or other financial intermediary. Each
Portfolio's Class B has a Distribution and Service Plan pursuant to Rule
12b-1 ( the Class B Plan s ). Under each Class B Plan,
Class B is authorized to pay Distributors a monthly distribution fee
at an annual rate of up to .32% of its average net assets ( except
Government Portfolio which is .25%). All or a portion of the
distribution fee is paid by Distributors to banks or other financial
intermediaries as compensation for providing Class B sales and/or
shareholder support services. Class B shares of one Portfolio may be
exchanged (subject to the minimum initial investment requirement) at
no charge for Class B shares of any other Portfolio of the Fund .
In the event that FMR ceases to be the investment adviser to the Fund
or a Portfolio, the right of the Fund 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 and Statement of Additional Information about another Portfolio.
The assets of the Fund received for the issue or sale of shares of each of
its Portfolios 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 Fund. Expenses with respect
to the Fund are to be allocated in proportion to the asset value of the
respective Portfolios or classes except where allocations of direct
expense can otherwise be fairly made. The officers of the Fund, subject to
the general supervision of the Board of Trustees, have the power to
determine which expenses are allocable to a given Portfolio or
class , or which are general or allocable to all of the Portfolios. In
the event of the dissolution or liquidation of the Fund, 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 Fund 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 Fund and requires that
a disclaimer be given in each contract entered into or executed by the Fund
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 the
P ortfolio is unable to meet its obligations. FMR believes that, in view
of the above, the risk of personal liability to shareholders is extremely
remote.
The Trust Instrument further provides that the Trustees, if they have
exercised reasonable care, shall not be personally liable to any person
other than the Fund 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. Each class of each Portfolio's capital consists of shares of
beneficial interest. 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 this Prospectus and Statement of Additional
Information. 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 Fund, a Portfolio or a c lass may, as
set forth in the Trust Instrument, call meetings of the Fund ,
Portfolio or class for any purpose related to the Fund, Portfolio or
class, as the case may be, including, in the case of a meeting of
the entire Fund, the purpose of voting on removal of one or more Trustees.
The Fund or a Portfolio may be terminated upon the sale of its
assets to 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 outstanding
shares of the Fund or Portfolio; however, the Trustees may, without
prior shareholder approval, change the form or organization of the Fund by
merger, consolidation, or incorporation. If not so terminated, the Fund
and the Portfolios will continue indefinitely.
Under the Trust Instrument, the Trustees may, without shareholder vote,
cause the Fund to merge or consolidate into one or more trusts,
partnerships, or corporations, or cause the Fund 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 Fund 's
registration statement.
As of March 3 1 , 1994, the following owned of record or
beneficially 5% or more of the outstanding Class A shares of:
Treasury Portfolio
Michigan National Bank, Farmington Hills, MI 22.11%
Wachovia Bank & Trust, Winston-Salem, NC 7.18%
First Bank Systems, Minneapolis, MN 7.03%
Bank of America, San Francisco, CA 5.99%
Treasury Portfolio II
First Union Bank of Charlotte, Charlotte, NC 13.97%
Bank of America, San Francisco, CA 13.22%
First Tennesee Bank, Memphis, TN 9.20%
Texas Commerce Bank, N.A., Houston, TX 5.15%
Government Portfolio
First Tennessee Bank, Memphis, TN 8.71%
First Trust of St. Paul, St. Paul, MN 8.31%
Mass General Hospital, Boston, MA 7.70%
Mass Water Resource Authority, Boston, MA 7.54%
Texas Commerce Bank, N.A., Houston, TX 5.45%
Domestic Portfolio
First Union Bank of Charlotte, Charlotte, NC 34.74%
Texas Commerce Bank, N.A., Houston, TX 10.61%
Union Trust Company, New Haven, CT 10.25%
Money Market Portfolio
Shawmut Bank N.A., Boston, MA 11.80%
First Bank System, Minneapolis, MN 6.45%
A shareholder owning more than 25% of the Portfolio's shares may be
considered a "controlling person" of the Portfolio. Accordingly, its vote
could have a more significant effect on matters presented at a
shareholders' meeting than the other shareholders of the Portfolio.
CUSTODIAN. Morgan Guaranty Trust Company of New York, 60 Wall Street, New
York, NY 10260 is custodian of the assets of all Portfolios
except Treasury Portfolio II. As of September 15, 1993, the custodian for
Treasury Portfolio II is the Bank of New York, 48 Wall Street, New York,
NY . 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
Portfolio or in deciding which securities are purchased or sold by the
Portfolio . The Portfolios, however, may 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
Fund's Trustees may, from time to time, have transactions with various
banks, including banks serving as custodians for certain of the other
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 Fund relationships.
AUDITOR. Price Waterhouse , 1700 Pacific Avenue, Dallas, TX 75201
serves as the Fund's independent accountants. The auditor examines
financial statements for the Fund and provides other audit, tax, and
related services.
FMR. FMR, 82 Devonshire Street, Boston, Massachusetts 02109, is a wholly
owned subsidiary of FMR Corp., a parent company organized in 1972. At
present, the principal operating activities of FMR Corp. are those
conducted by three of its divisions as follows: Fidelity Service Co., which
is the transfer and shareholder servicing agent for certain of the funds
advised by FMR; Fidelity Investments Institutional Operations Company,
which performs shareholder servicing functions for certain institutional
customers; and Fidelity Investments Retail Services Marketing Company,
which provides marketing services to various companies within the Fidelity
organization. Through ownership of voting common stock, Edward C. Johnson
3rd (President and a Trustee of the Fund), Johnson family members, and
various trusts for the benefit of Johnson family members form a controlling
group with respect to FMR Corp.
Several affiliates of FMR also are engaged in the investment advisory
business. Fidelity Management Trust Company provides trustee, investment
advisory and administrative services to retirement plans and corporate
employee benefit accounts. Fidelity Management & Research (U.K.) Inc. (FMR
U.K.) and Fidelity Management & Research (Far East) Inc. (FMR Far East),
both wholly owned subsidiaries of FMR formed in 1986, supply investment
research, and may supply portfolio management services, to FMR in
connection with certain funds advised by FMR. Analysts employed by FMR, FMR
U.K., and FMR Far East research and visit thousands of domestic companies
each year. FMR Texas, a wholly owned subsidiary of FMR formed in 1989,
supplies portfolio management and research services in connection with
certain money market funds advised by FMR.
TRUSTEES AND OFFICERS. The Trustees and executive officers of the
Fund 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. Trustees and officers elected or appointed prior to the
Fund's conversion to a Delaware business trust served the
Massachusetts business trust in identical capacities. All persons named as
Trustees 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, Massachusetts 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 Fund
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, NY, 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 serves as a Director of the New York
City Chapter of the National Multiple Sclerosis Society, and is a member of
the Advisory Council of the International Executive Service Corps. and the
President's Advisory Council of The University 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 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 (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 (1988).
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 Rensellaer 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 the 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 (1988), 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.
ROBERT H. MORRISON, Manager, Security Transactions, is an employee of
FMR.
LELAND BARRON Vice President (1989), is also Vice President of other funds
advised by FMR and an employee of FMR Texas Inc.
BURNELL STEHMAN Vice President (1992), is also Vice President of other
funds advised by FMR and an employee of FMR Texas Inc.
JOHN TODD Vice President (1992), is also Vice President of other funds
advised by FMR and an employee 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 Inc. (1990).
Under a retirement program which became effective on November 1, 1989, a
Trustee, upon reaching age 72, becomes eligible to participate in a defined
benefit retirement program under which he receives payments during his
lifetime from the Portfolios based on his final year's 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 receive additional payments for serving in similar
capacities for other funds advised by FMR. The Trustees and officers of the
Fund as a group own less than 1% of each Portfolio's outstanding shares.
APPENDIX A
The following paragraphs provide a brief description of securities in which
the Portfolios may invest and transactions they may make. The Portfolios
are 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 Portfolios' respective investment objectives and
policies.
AFFILIATED BANK TRANSACTIONS. A 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 SEC, the Board of Trustees has
established and periodically reviews procedures applicable to transactions
involving affiliated financial institutions.
ASSET-BACKED SECURITIES may 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.
BANKERS' ACCEPTANCES. Negotiable obligations of a bank to pay a draft which
has been drawn on it by a customer. These obligations are backed by large
banks and usually are backed by goods in international trade.
CERTIFICATES OF DEPOSIT. Negotiable certificates representing a commercial
bank's obligations to repay funds deposited with it, earning specified
rates of interest over a given period of time.
COMMERCIAL PAPER. Short-term obligations issued by banks, broker-dealers,
corporations and other entities for purposes such as financing their
current operations.
CORPORATE OBLIGATIONS. Bonds and notes issued by corporations and other
business organizations in order to finance their long-term credit needs.
DELAYED DELIVERY TRANSACTIONS. Each Portfolio may buy and sell securities
on a delayed delivery or when-issued basis. These transactions involve a
commitment by a 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, each 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 the 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, the
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, the Portfolio could miss a favorable price or yield
opportunity, or could suffer a loss.
Each 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.
FINANCIAL SERVICES INDUSTRY. Because Domestic Portfolio and Money Market
Portfolio concentrate more than 25% of their respective total assets in the
financial services industry, their 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 U.S. branches of both 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. These obligations include time deposits,
certificates of deposit, bankers' acceptances, and commercial paper.
FOREIGN SECURITIES. Eurodollar and Yankee dollar investments of Money
Market Portfolio risks include future unfavorable political and economic
developments, possible withholding taxes, seizure of foreign deposits,
currency controls, interest limitations or other governmental restrictions
which might affect payment of principal or interest. Additionally, there
may be less public information available about foreign banks and their
branches than is available with respect to domestic banks. 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 the Adviser carefully
considers these factors when making investments, the Money Market Portfolio
does not limit the amount of its assets which can be invested in any one
type of instrument or in any foreign country.
ILLIQUID INVESTMENTS. 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 each 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 Portfolios to be illiquid include
repurchase agreements not entitling the holder to payment of principal and
interest within seven days. Also, for Domestic Money Market Portfolio and
Money Market Portfolio FMR may determine some restricted securities and
time deposits to be illiquid. In the absence of market quotations illiquid
investments are priced 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, a Portfolio were in a position
where more than 10% of its net assets were invested in illiquid securities,
it would seek to take appropriate steps to protect liquidity.
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. Treasury
Portfolio, Treasury Portfolio II and Government Portfolio will participate
in this interfund lending program only as borrowers. Each Portfolio will
borrow through the program only when costs are equal to or lower than the
cost of bank loans. Domestic Money Market and 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). Each Portfolio that may lend will not lend more
than 10% of its net assets to other funds and no Portfolio will borrow
through the program if, after doing so, its total outstanding borrowings
would exceed 15% of total assets. Loans may be called on one day's notice
and a 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.
MONEY MARKET refers to the marketplace where short-term, high quality debt
securities are traded, including U.S. government obligations, commercial
paper, certificates of deposit, bankers' acceptances, time deposits and
short-term corporate obligations. Money market instruments may carry fixed
rates of return or have variable or floating interest rates.
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 are transactions by which a Portfolio purchases a
security and simultaneously commits to resell that security to the seller
at an agreed upon price on an agreed upon date within a number of days from
the date of purchase. 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. A repurchase agreement involves the
obligation of the seller to pay the agreed upon price, which obligation is
in effect secured by the value (at least equal to the amount of the agreed
upon resale price and marked to market daily) of the underlying security.
Each Portfolio may engage in a repurchase agreement with respect to any
type of security in which that Portfolio is authorized to invest,
regardless of length of time to maturity. While it does not presently
appear possible to eliminate all risks from these transactions
(particularly the possibility of a decline in the market value of the
underlying securities, as well as delays and costs to the Portfolios in
connection with bankruptcy proceedings), it is the policy of each Portfolio
to limit repurchase agreements to parties whose creditworthiness has been
reviewed and found satisfactory by FMR.
RESTRICTED SECURITIES. Restricted securities are not registered for sale to
the general public. 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 the
fund 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.
REVERSE REPURCHASE AGREEMENTS. Each Portfolio, other than Treasury
Portfolio II, may engage in reverse repurchase agreements. Reverse
repurchase agreements are transactions whereby a Portfolio temporarily
transfers possession of 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 time. A
Portfolio expects that it will engage in reverse repurchase agreements for
temporary purposes such as to fund redemptions or when it is able to invest
cash so acquired at a rate higher than the cost of the agreement, which
would increase the income earned by a Portfolio. 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. Reverse repurchase agreements may increase the risk of
fluctuation in the market value of a Portfolio's assets or in its yield.
Such transactions may increase fluctuations in the market value of a
Portfolio's assets and may be viewed as a form of leverage. A Portfolio
will enter into reverse repurchase agreements only with parties whose
creditworthiness has been found satisfactory by FMR.
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 of the 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 hold such securities while the
short sale is outstanding. The Portfolio will incur transaction costs,
including interest expense, in connection with opening, maintaining, and
closing short sales against the box.
STRIPPED GOVERNMENT SECURITIES. 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 of New York and sold separately.
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 INSTRUMENTS bear variable or floating interest
rates and carry rights that permit holders to demand payment of the unpaid
principal balance plus accrued interest from the issuers or certain
financial intermediaries. Floating rate instruments have interest rates
that change whenever there is a change in a designated base rate, while
variable rate instruments provide for a specified periodic adjustment in
the interest rate. These formulas are designed to result in a market value
for the instrument that approximates its par value.
A Portfolio may invest in variable or floating rate instruments that
ultimately mature in more than 397 days if the Portfolio acquires a right
to sell securities that meet certain requirements set forth in Rule 2a-7.
Variable rate instruments (including instruments subject to a demand
feature) that mature in 397 days or less and U.S. government obligations
with a variable rate of interest reset no less frequently than every 762
days may be deemed to have maturities equal to the period remaining until
the next readjustment of the interest rate. Other variable rate instruments
with demand features may be deemed to have a maturity equal to the longer
of the period remaining until the next readjustment of the interest rate or
the period remaining until the principal amount can be recovered through
demand. A floating rate instrument subject to a demand feature may be
deemed to have a maturity equal to the period remaining until the principal
amount can be recovered through demand.
APPENDIX B
RATINGS
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:
PRIME-1 - issuers (or related institutions) have a superior capacity for
repayment of short-term promissory obligations. Prime-1 repayment capacity
will normally be evidenced by the following characteristics:
(solid bullet) Leading market positions in well established industries.
(solid bullet) High rates of return on funds employed.
(solid bullet) Conservative capitalization structures with moderate
reliance on debt and ample asset protection.
(solid bullet) Broad margins in earnings coverage of fixed financial
charges with high internal cash generation.
(solid bullet) Well-established access to a range of financial markets and
assured sources of alternate liquidity.
PRIME-2 - issuers (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 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 COMMERCIAL PAPER RATINGS:
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 STANDARD & POOR'S CORPORATION'S CORPORATE BOND RATINGS:
AAA - Debt rated AAA has the highest rating assigned by Standard & Poor's.
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
<PAGE>
U.S. GOVERNMENT PORTFOLIO
(a series of Fidelity Institutional Cash Portfolios)
U.S. GOVERNMENT PORTFOLIO
(a series of Fidelity Money Market Trust)
FORM N-14
PROSPECTUS/STATEMENT OF ADDITIONAL INFORMATION
July __, 1995
This Statement of Additional Information relates to the proposed
reorganizations whereby U.S. Government Portfolio, a series of Fidelity
Institutional Cash Portfolios (FICP Government), would acquire
substantially all of the assets of U.S. Government Portfolio (FMMT
Government), a series of Fidelity Money Market Trust, and assume all of
FMMT Government's liabilities in exchange solely for Class A shares of
beneficial interest in FICP Government.
This Statement of Additional Information consists of this cover page and
the following described documents, each of which is attached hereto and
incorporated herein by reference:
1. The Prospectus and Statement of Additional Information for
Fidelity Money Market Trust, dated December 29, 1994 which includes FMMT
Government.
2. The Annual Report of Fidelity Institutional Cash Portfolios for
the year ended March 31, 1995, which includes FICP Government.
3. The Annual Report of Fidelity Money Market Trust for the year
ended August 31, 1994, which includes FMMT Government.
4. The Semiannual Report of Fidelity Money Market Trust for the six
months ended February 28, 1995, which includes FMMT Government.
This Statement of Additional Information is not a prospectus. A Proxy
Statement and Prospectus dated July __, 1995, relating to the above-
referenced matter may be obtained from Fidelity Distributors Corporation,
82 Devonshire Street, Boston, Massachusetts, 02109. This Statement of
Additional Information relates to, and should be read in conjunction with,
such Proxy Statement and Prospectus.
The date of this Statement of Additional Information is July __, 1995.
<PAGE>
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
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 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%
2.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
3.EXPLANATION OF TABLE
A. 4.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. 5.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%. 6.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
8.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
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Year Ended August Ten Months Years 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 income
3.15% 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
<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% 4.18% 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
<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.
9.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.
10.INVESTMENT POLICIES, RISKS AND LIMITATIONS
11.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.
12.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.
13.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.
14.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) 15.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.
16.FIRST TIER SECURITIES are those deemed to be in the
highest rating category (e.g., Standard & Poor's A-1).
17.SECOND TIER SECURITIES are those deemed to be in the second highest
rating category (e.g., Standard & Poor's A-2) .
(medium solid bullet) 18.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) 19.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.
20. 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.
21.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.
22.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.
23.PERFORMANCE
From time to time each Portfolio advertises its 24.YIELD and 25.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 26.YIELD refers to the income generated by an investment
in the Portfolio over a seven-day period expressed as an annual percentage
rate. The 27.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 28.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 29.CUMULATIVE TOTAL RETURN reflects a
Portfolio's performance over a stated period of time. An 30.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.
31.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.
32.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.
33.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.
34.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.
35.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.
36.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.
37.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.
38.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.
39.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
40.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.
41.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.
42.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.
43.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.
44.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.
45.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.
46.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.
47.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.
48.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.
49.MANAGEMENT CONTRACTS, DISTRIBUTION AND SERVICE PLANS
50.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.
51.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.
52.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.
53.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.
54.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.
55.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.
56.COMMERCIAL PAPER are short-term obligations issued by banks,
broker-dealers, corporations and other entities for purposes such as
financing their current operations.
57.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.
58.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.
59.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.
60.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.
61.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.
62.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.
63.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.
64.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.
65.TIME DEPOSITS are non-negotiable deposits in a banking institution
earning a specified interest rate over a given period of time.
66.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.
<PAGE>
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
U. S. TREASURY PORTFOLIO
<TABLE>
<CAPTION>
One Year Five Year Ten Year
<S> <C> <C> <C>
Average Annual Total Returns 3.21 % 5.06 % 6.27 %
Cumulative Total Returns 3.21 % 27.99 % 83.74 %
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 %
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.
PERIOD ENDED INITIAL VALUE OF VALUE OF TOTAL CONSUMER
$10,000 REINVESTED REINVESTED VALUE PRICE
INVESTMENT DIVIDENDS CAPITAL GAINS INDEX
<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.
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY PORTFOLIO
INVESTMENTS MARCH 31, 1995
Showing Percentage of Total Value of Investments
U.S. TREASURY OBLIGATIONS - 40.3%
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
U.S. TREASURY BILLS - 32.8%
4/20/95 5.97% $ 259,266,800 $ 259,266,800
5/4/95 5.68 22,000,000 21,888,680
7/13/95 6.63 57,000,000 55,953,821
7/27/95 6.40 28,000,000 27,435,800
8/10/95 6.29 35,000,000 34,223,097
8/24/95 5.48 40,000,000 39,161,416
8/31/95 6.19 42,000,000 40,936,000
478,865,614
U.S. TREASURY NOTES - 7.5%
4/30/95 5.54 34,000,000 33,951,603
5/15/95 5.66 15,000,000 15,000,403
5/15/95 6.23 15,000,000 14,992,768
5/15/95 6.33 15,000,000 14,990,977
5/15/95 6.45 15,000,000 15,035,024
5/15/95 6.46 15,000,000 14,988,313
108,959,088
TOTAL U.S. TREASURY OBLIGATIONS 587,824,702
MEDIUM-TERM NOTES (A) (B) - 1.1%
EXPORT-IMPORT BANK, U.S. (AS GUARANTOR FOR K.A. LEASING, LTD.)
4/15/95 6.25 15,608,350 15,608,350
REPURCHASE AGREEMENTS - 58.6%
MATURITY VALUE
AMOUNT (NOTE 1)
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/95, due 4/3/95:
At 6.20% $ 529,273,398 $ 529,000,000
At 6.23% 61,699,018 61,667,000
At 6.24% 263,319,925 263,183,000
TOTAL REPURCHASE AGREEMENTS 853,850,000
TOTAL INVESTMENTS - 100% $ 1,457,283,052
Total Cost for Income Tax Purposes $ 1,457,283,052
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 $15,608,350 or 1.3% of net
assets.
INCOME TAX INFORMATION
At March 31, 1995 the fund had a capital loss carryforward of approximately
$512,000 of which $29,000, 109,000, $122,000, $95,000 and $157,000 will
expire on March 31, 1996, 1997, 1999, 2002 and 2003, respectively.
For the period ended March 31, 1995, approximately 30% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY PORTFOLIO
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
MARCH 31, 1995
1.ASSETS 2. 3.
4.Investment in securities, at value (including repurchase agreements of $853,850,000) - 5. $ 1,457,283,052
See accompanying schedule
6.Cash 7. 16,520
8.Interest receivable 9. 2,639,166
10.Receivable from investment adviser for expense reductions 11. 62,685
12. 13.TOTAL ASSETS 14. 1,460,001,423
15.LIABILITIES 16. 17.
18.Payable for investments purchased $ 259,266,800 19.
20.Dividends payable 2,664,291 21.
22.Accrued management fee 202,084 23.
24.Other payables and accrued expenses 146,781 25.
26. 27.TOTAL LIABILITIES 28. 262,279,956
29.30.NET ASSETS 31. $ 1,197,721,467
32.Net Assets consist of: 33. 34.
35.Paid in capital 36. $ 1,198,232,716
37.Accumulated net realized gain (loss) on investments 38. (511,249)
39.40.NET ASSETS, for 1,198,225,128 shares outstanding 41. $ 1,197,721,467
42.43.NET ASSET VALUE, offering price and redemption price per share 44. $1.00
($1,197,721,467 (divided by) 1,198,225,128 shares)
</TABLE>
<PAGE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED MARCH 31, 1995
45.46.INTEREST INCOME 47. $ 63,568,355
48.EXPENSES 49. 50.
51.Management fee $ 2,645,934 52.
53.Transfer agent fees 113,703 54.
55.Accounting fees and expenses 149,193 56.
57.Non-interested trustees' compensation 47,131 58.
59.Custodian fees and expenses 110,308 60.
61.Registration fees 85,803 62.
63.Audit 19,247 64.
65.Legal 17,080 66.
67.Reports to shareholders 469 68.
69.Miscellaneous 14,760 70.
71. Total expenses before reductions 3,203,628 72.
73. Expense reductions (822,285) 2,381,343
74.75.NET INTEREST INCOME 76. 61,187,012
77.78.NET REALIZED GAIN (LOSS) ON INVESTMENTS 79. (156,575)
80.81.NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 82. $ 61,030,437
</TABLE>
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1995 1994
83.INCREASE (DECREASE) IN NET ASSETS
84.Operations $ 61,187,012 $ 57,501,273
Net interest income
85. Net realized gain (loss) (156,575) (94,848)
86. 87.NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 61,030,437 57,406,425
88.Dividends to shareholders from net interest income (61,187,012) (57,501,273)
89.Share transactions at net asset value of $1.00 per share 6,383,701,214 11,024,606,904
Proceeds from sales of shares
90. Reinvestment of dividends from net interest income 34,822,237 29,704,546
91. Cost of shares redeemed (6,832,522,666) (11,479,144,890)
92. Net increase (decrease) in net assets and shares resulting from share transactions (413,999,215) (424,833,440)
93. 94.TOTAL INCREASE (DECREASE) IN NET ASSETS (414,155,790) (424,928,288)
95.NET ASSETS 96. 97.
98. Beginning of period 1,611,877,257 2,036,805,545
99. End of period $ 1,197,721,467 $ 1,611,877,257
</TABLE>
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED MARCH 31,
1995 1994 1993 1992 1991
100.SELECTED PER-SHARE DATA
101.Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
102.Income from Investment Operations .047 .030 .035 .053 .076
Net interest income
103.Less Distributions (.047) (.030) (.035) (.053) (.076)
From net interest income
104.Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
105.TOTAL RETURN A 4.79% 3.08% 3.51% 5.48% 7.89%
106.RATIOS AND SUPPLEMENTAL DATA
107.Net assets, end of period (000 omitted) $1,197,721 $1,611,877 $2,036,806 $2,629,072 $1,782,957
108.Ratio of expenses to average net assets .18% .18% .18% .18% .18%
109.Ratio of expenses to average net assets
before .24% .23% .23% .25% .24%
expense reductions
110.Ratio of net interest income to average
net assets 4.63% 3.03% 3.46% 5.29% 7.57%
</TABLE>
A TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN. SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY PORTFOLIO II
INVESTMENTS MARCH 31, 1995
Showing Percentage of Total Value of Investments
U.S. TREASURY OBLIGATIONS - 34.8%
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
U.S. TREASURY BILLS - 28.8%
5/4/95 5.68% $ 1,102,000,000 $ 1,049,033,360
5/4/95 5.68 77,000,000 76,610,380
7/13/95 6.64 192,000,000 188,472,918
7/27/95 6.40 116,000,000 113,662,600
8/10/95 6.29 134,000,000 131,025,573
8/24/95 5.48 121,000,000 118,465,722
8/31/95 6.19 145,000,000 141,326,666
1,818,597,219
U.S. TREASURY NOTES - 6.0%
4/30/95 5.54 110,000,000 109,843,423
5/15/95 5.66 53,000,000 53,001,423
5/15/95 6.23 54,000,000 53,973,966
5/15/95 6.33 54,000,000 53,967,516
5/15/95 6.45 54,000,000 54,126,086
5/15/95 6.46 57,000,000 56,955,587
381,868,001
TOTAL U.S. TREASURY OBLIGATIONS 2,200,465,220
<PAGE>
REPURCHASE AGREEMENTS - 65.2%
MATURITY
AMOUNT
With Barclays de Zoete Wedd Government Securities, Inc.:
At 6.20%, dated 3/31/95, due 4/3/95:
U.S. Treasury Obligations
(principal amount $102,000,609)
3.875% to 11.75%,
7/15/95 to 2/15/23 $ 100,051,667 100,000,000
With Daiwa Securities Co., Ltd.:
At 6.28%, dated 3/31/95, due 4/3/95:
U.S. Treasury Obligations
(principal amount $117,300,933)
0% to 8.375%,
8/15/95 to 8/15/08 115,060,183 115,000,000
With Donaldson, Lufkin & Jenrette Securities Corp.
At 6.30%, dated 3/31/95, due 4/3/95:
U.S. Treasury Obligations
(principal amount $108,120,127)
0% to 8.875%,
4/30/95 to 11/15/24 106,055,650 106,000,000
With Goldman Sachs & Co.:
At 6.30%, dated 3/31/95, due 4/3/95:
U.S. Treasury Obligations
(principal amount $104,028,985)
0%, 6/29/95 102,042,544 101,989,000
REPURCHASE AGREEMENTS - CONTINUED
MATURITY VALUE
AMOUNT (NOTE 1)
With Lehman Government Securities:
At 6.30%, dated 3/31/95, due 4/3/95:
U.S. Treasury Obligations
(principal amount $108,125,627)
7.625% to 15.75%,
8/15/00 to 11/15/12 $ 106,055,650 $ 106,000,000
With Morgan Stanley & Co., Inc.:
At 6.10%, dated 3/31/95, due 4/3/95:
U.S. Treasury Obligations
(principal amount $15,477,458)
6.25% to 7.75%,
12/31/99 to 2/15/03 15,007,625 15,000,000
With Nomura Securities International, Inc.:
At 6.27%, dated 3/31/95, due 4/3/95:
U.S. Treasury Obligations
(principal amount $108,121,051)
6.625% to 11.125%,
3/31/97 to 8/15/03 106,055,385 106,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/95, due 4/3/95:
At 6.20% 3,149,626,170 3,148,000,000
At 6.23% 332,298,444 332,126,000
TOTAL REPURCHASE AGREEMENTS 4,130,115,000
TOTAL INVESTMENTS - 100% $ 6,330,580,220
Total Cost for Income Tax Purposes $ 6,330,580,220
INCOME TAX INFORMATION
At March 31, 1995, the fund had a capital loss carryforward of
approximately $603,000 of which $21,000, $214,000 and $368,000 will expire
on March 31, 1999, 2002 and 2003, respectively.
For the period ended March 31, 1995, approximately 27% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY PORTFOLIO II
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
MARCH 31, 1995
111.ASSETS 112. 113.
114.Investment in securities, at value (including repurchase agreements of $4,130,115,000) - 115. $ 6,330,580,220
See accompanying schedule
116.Interest receivable 117. 9,087,075
118.Receivable from investment adviser for expense reductions 119. 422,125
120. 121.TOTAL ASSETS 122. 6,340,089,420
123.LIABILITIES 124. 125.
126.Payable for investments purchased $ 1,049,033,360 127.
128.Share transactions in process 329,903 129.
130.Dividends payable 15,497,032 131.
132.Accrued management fee 804,534 133.
134.Other payables and accrued expenses 655,174 135.
136. 137.TOTAL LIABILITIES 138. 1,066,320,003
139.140.NET ASSETS 141. $ 5,273,769,417
142.Net Assets consist of: 143. 144.
145.Paid in capital 146. $ 5,274,371,906
147.Accumulated net realized gain (loss) on investments 148. (602,489)
149.150.NET ASSETS 151. $ 5,273,769,417
152.153.CLASS A: 155. $1.00
154.NET ASSET VALUE, offering price and redemption price per share
($4,688,198,169 (divided by) 4,688,611,950 shares)
156.CLASS B: 158. $1.00
157.NET ASSET VALUE, offering price and redemption price per share
($585,571,248 (divided by) 585,622,931 shares)
</TABLE>
<PAGE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED MARCH 31, 1995
159.160.INTEREST INCOME 161. $ 212,775,731
162.EXPENSES 163. 164.
165.Management fee $ 8,680,344 166.
167.Transfer agent fees 1,278,161 168.
Class A
169. Class B 28,447 170.
171.Distribution fees - Class B 418,917 172.
173.Accounting fees and expenses 375,762 174.
175.Non-interested trustees' compensation 86,005 176.
177.Custodian fees and expenses 104,003 178.
179.Registration fees - Class A 342,613 180.
181.Registration fees - Class B 333,235 182.
183.Audit 31,578 184.
185.Legal 49,903 186.
187.Reports to shareholders 1,174 188.
189.Miscellaneous 40,222 190.
191. Total expenses before reductions 11,770,364 192.
193. Expense reductions (3,539,319) 8,231,045
194.195.NET INTEREST INCOME 196. 204,544,686
197.198.NET REALIZED GAIN (LOSS) ON INVESTMENTS 199. (367,507)
200.201.NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 202. $ 204,177,179
</TABLE>
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1995 1994
203.INCREASE (DECREASE) IN NET ASSETS
204.Operations $ 204,544,686 $ 148,219,217
Net interest income
205. Net realized gain (loss) (367,507) (214,389)
206. 204,177,179 148,004,828
207.NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS
208.Distributions to shareholders from:
Net interest income
209. (198,121,404) (148,201,826)
Class A
210. (6,423,282) (17,391)
Class B
211.Share transactions - net increase (decrease) at net asset value of $1.00 per share 717,043,407 (1,032,355,168)
212. 716,675,900 (1,032,569,557)
213.TOTAL INCREASE (DECREASE) IN NET ASSETS
214.NET ASSETS 215. 216.
217. Beginning of period 4,557,093,517 5,589,663,074
218. End of period $ 5,273,769,417 $ 4,557,093,517
</TABLE>
<PAGE>
FINANCIAL HIGHLIGHTS - CLASS A
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED MARCH 31,
1995 1994 1993 1992 1991
219.SELECTED PER-SHARE DATA
220.Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
221.Income from Investment Operations
222. Net interest income .047 .030 .034 .053 .076
223.Less Distributions
224. From net interest income (.047) (.030) (.034) (.053) (.076)
225.Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
226.TOTAL RETURN A 4.78% 3.06% 3.46% 5.41% 7.87%
227.RATIOS AND SUPPLEMENTAL DATA
228.Net assets, end of period (000 omitted) $4,688,198 $4,551,918 $5,589,663 $5,476,852 $3,281,686
229.Ratio of expenses to average net assets .18% .18% .18% .18% .18%
230.Ratio of expenses to average net assets before .25% .24% .23% .25% .25%
expense reductions
231.Ratio of net interest income to average net assets 4.71% 3.01% 3.38% 5.12% 7.50%
</TABLE>
A TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN. SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<PAGE>
FINANCIAL HIGHLIGHTS - CLASS B
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR OCTOBER 22, 1993
ENDED (COMMENCEMENT
MARCH 31, OF OPERATIONS) TO
MARCH 31,
1995 1994
232.SELECTED PER-SHARE DATA
233.Net asset value, beginning of period $ 1.000 $ 1.000
234.Income from Investment Operations
235. Net interest income .044 .012
236.Less Distributions
237. From net interest income (.044) (.012)
238.Net asset value, end of period $ 1.000 $ 1.000
239.TOTAL RETURN B 4.45% 1.21%
240.RATIOS AND SUPPLEMENTAL DATA
241.Net assets, end of period (000 omitted) $ 585,571 $ 5,175
242.Ratio of expenses to average net assets .50% .50%A
243.Ratio of expenses to average net assets before expense reductions .81% .56%A
244.Ratio of net interest income to average net assets 4.91% 2.69%A
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED. TOTAL
RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING
THE PERIODS SHOWN. SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. GOVERNMENT PORTFOLIO
INVESTMENTS MARCH 31, 1995
Showing Percentage of Total Value of Investments
FEDERAL AGENCIES - 54.8%
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
FEDERAL FARM CREDIT BANK - AGENCY COUPONS (A) - 3.1%
4/3/95 5.71% $ 10,000,000 $ 9,999,268
4/3/95 6.26 94,000,000 93,857,863
103,857,131
FEDERAL FARM CREDIT BANK - DISCOUNT NOTES - 1.6%
5/2/95 5.80 10,000,000 9,951,434
5/2/95 5.81 36,000,000 35,824,850
5/22/95 6.15 10,000,000 9,915,425
55,691,709
FEDERAL HOME LOAN BANK - AGENCY COUPONS (A) - 2.6%
4/3/95 6.17 88,000,000 87,982,414
FEDERAL HOME LOAN BANK - DISCOUNT NOTES - 5.3%
4/24/95 5.80 85,000,000 84,693,717
5/5/95 5.95 45,000,000 44,754,350
6/13/95 6.83 48,000,000 47,357,600
176,805,667
FEDERAL HOME LOAN MORTGAGE CORP. - DISCOUNT NOTES - 2.9%
4/3/95 5.77 4,000,000 3,998,753
4/3/95 6.40 40,000,000 39,986,044
5/16/95 6.03 11,500,000 11,414,613
5/22/95 6.03 41,000,000 40,654,985
96,054,395
FEDERAL NATIONAL MORTGAGE ASSOC. - AGENCY COUPONS - 5.9%
4/3/95 6.60 (a) 190,000,000 190,000,000
5/10/95 5.58 9,160,000 9,214,973
199,214,973
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 23.9%
4/5/95 5.74 44,000,000 43,972,720
4/18/95 5.66 68,000,000 67,823,389
5/11/95 5.98 45,000,000 44,710,000
5/15/95 6.03 22,800,000 22,634,472
5/16/95 6.03 23,000,000 22,829,225
5/17/95 6.14 95,000,000 94,276,522
6/2/95 6.51 47,000,000 46,490,050
6/28/95 6.40 96,000,000 94,538,026
7/10/95 6.72 38,700,000 38,001,250
7/11/95 6.73 48,000,000 47,123,320
8/7/95 6.38 88,000,000 86,066,346
8/8/95 6.38 26,000,000 25,424,230
8/17/95 6.35 36,000,000 35,151,300
9/14/95 6.28 138,000,000 134,131,093
803,171,943
STUDENT LOAN MARKETING ASSOC. - AGENCY COUPONS (A) - 9.5%
4/4/95 6.12 51,000,000 51,009,308
4/4/95 6.14 170,000,000 170,000,000
6/30/95 5.48 100,000,000 100,000,000
321,009,308
TOTAL FEDERAL AGENCIES 1,843,787,540
U.S. TREASURY OBLIGATIONS - 5.0%
DUE ANNUALIZED YIELD AT PRINCIPAL VALUE
DATE TIME OF PURCHASE AMOUNT (NOTE 1)
U.S. TREASURY BILLS
8/24/95 5.47% $ 95,000,000 $ 93,014,105
8/31/95 6.19 78,000,000 76,024,000
TOTAL U.S. TREASURY OBLIGATIONS 169,038,105
MEDIUM-TERM NOTES (A) (B) - 1.0%
EXPORT-IMPORT BANK, U.S. (AS GUARANTOR FOR K.A. LEASING, LTD.)
4/15/95 6.25 35,492,196 35,492,196
REPURCHASE AGREEMENTS - 39.2%
<PAGE>
MATURITY VALUE
AMOUNT (NOTE 1)
With Bear Stearns & Co., Inc.:
At 6.20%, dated 3/29/95, due 4/5/95:
U.S. Government Obligations
(principal amount $67,268,634)
5.735% to 6.064%,
8/1/18 to 10/1/21 $ 65,078,361 65,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/95, due 4/3/95:
At 6.24% 251,768,919 251,638,000
(U.S. Government Obligations)
dated 3/31/95 due 4/3/95:
At 6.33% 1,001,982,267 1,001,454,000
TOTAL REPURCHASE AGREEMENTS 1,318,092,000
TOTAL INVESTMENTS - 100% $ 3,366,409,841
Total Cost for Income Tax Purposes $ 3,366,409,841
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 $35,492,196 or 1.1% of net
assets.
INCOME TAX INFORMATION
At March 31, 1995, the fund had a capital loss carryforward of
approximately $1,028,000 of which $40,000, $243,000 and $745,000 will
expire on March, 31, 2001, 2002 and 2003, respectively.
For the period ended March 31, 1995, approximately 20% of the fund's
dividends to shareholders was derived from interest on U.S. Government
obligations.
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. GOVERNMENT PORTFOLIO
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
MARCH 31, 1995
245.ASSETS 246. 247.
248.Investment in securities, at value (including repurchase agreements of $1,318,092,000) - 249. $ 3,366,409,841
See accompanying schedule
250.Interest receivable 251. 7,075,809
252.Receivable from investment adviser for expense reductions 253. 161,277
254. 255.TOTAL ASSETS 256. 3,373,646,927
257.LIABILITIES 258. 259.
260.Share transactions in process $ 1,191,596 261.
262.Dividends payable 10,033,811 263.
264.Accrued management fee 577,815 265.
266.Other payables and accrued expenses 262,538 267.
268. 269.TOTAL LIABILITIES 270. 12,065,760
271.272.NET ASSETS 273. $ 3,361,581,167
274.Net Assets consist of: 275. 276.
277.Paid in capital 278. $ 3,362,609,535
279.Accumulated net realized gain (loss) on investments 280. (1,028,368)
281.282.NET ASSETS 283. $ 3,361,581,167
284.285.CLASS A: 287. $1.00
286.NET ASSET VALUE, offering price and redemption price per share
($3,321,065,528 (divided by) 3,321,584,137 shares)
288.CLASS B: 290. $1.00
289.NET ASSET VALUE, offering price and redemption price per share
($40,515,639 (divided by) 40,521,966 shares)
</TABLE>
<PAGE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED MARCH 31, 1995
291.292.INTEREST INCOME 293. $ 165,300,887
294.EXPENSES 295. 296.
297.Management fee $ 6,680,088 298.
299.Transfer agent fees 457,103 300.
Class A
301. Class B 9,105 302.
303.Distribution fees - Class B 46,340 304.
305.Accounting fees and expenses 331,170 306.
307.Non-interested trustees' compensation 57,096 308.
309.Custodian fees and expenses 220,421 310.
311.Registration fees - Class A 45,368 312.
313.Registration fees - Class B 25,663 314.
315.Audit 43,696 316.
317.Legal 42,021 318.
319.Reports to shareholders 933 320.
321.Miscellaneous 35,316 322.
323. Total expenses before reductions 7,994,320 324.
325. Expense reductions (1,936,406) 6,057,914
326.327.NET INTEREST INCOME 328. 159,242,973
329.330.NET REALIZED GAIN (LOSS) ON INVESTMENTS 331. (745,189)
332.333.NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 334. $ 158,497,784
</TABLE>
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEARS ENDED MARCH 31,
1995 1994
335.INCREASE (DECREASE) IN NET ASSETS
336.Operations $ 159,242,973 $ 148,432,891
Net interest income
337. Net realized gain (loss) (745,189) (243,492)
338. 158,497,784 148,189,399
339.NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS
340.Distributions to shareholders from:
Net interest income
341. (158,291,994) (148,432,891)
Class A
342. (950,979) -
Class B
343.Share transactions - net increase (decrease) at net asset value of $1.00 per share (402,217,854) (1,921,378,055)
344. (402,963,043) (1,921,621,547)
345.TOTAL INCREASE (DECREASE) IN NET ASSETS
346.NET ASSETS 347. 348.
349. Beginning of period 3,764,544,210 5,686,165,757
350. End of period $ 3,361,581,167 $ 3,764,544,210
</TABLE>
<PAGE>
FINANCIAL HIGHLIGHTS - CLASS A
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED MARCH 31,
1995 1994 1993 1992 1991
351.SELECTED PER-SHARE DATA
352.Net asset value, beginning of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
353.Income from Investment Operations
354. Net interest income .048 .031 .035 .054 .077
355.Less Distributions
356. From net interest income (.048) (.031) (.035) (.054) (.077)
357.Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
358.TOTAL RETURN A 4.86% 3.13% 3.56% 5.55% 7.94%
359.RATIOS AND SUPPLEMENTAL DATA
360.Net assets, end of period (000 omitted) $ 3,321,066 $ 3,764,544 $ 5,686,166 $ 4,603,781 $ 3,613,838
361.Ratio of expenses to average net assets .18% .18% .18% .18% .18%
362.Ratio of expenses to average net assets before .24% .24% .24% .25% .25%
expense reductions
363.Ratio of net interest income to average net
assets 4.77% 3.07% 3.50% 5.33% 7.62%
</TABLE>
A TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN. SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<PAGE>
FINANCIAL HIGHLIGHTS - CLASS B
<TABLE>
<CAPTION>
<S> <C>
364. APRIL 4, 1994
(COMMENCEMENT
OF OPERATIONS) TO
MARCH 31, 1995
365.SELECTED PER-SHARE DATA
366.Net asset value, beginning of period $ 1.000
367.Income from Investment Operations
368. Net interest income .045
369.Less Distributions
370. From net interest income (.045)
371.Net asset value, end of period $ 1.000
372.TOTAL RETURN B 4.32%
373.RATIOS AND SUPPLEMENTAL DATA
374.Net assets, end of period (000 omitted) $ 40,516
375.Ratio of expenses to average net assets .43%
A
376.Ratio of expenses to average net assets before expense reductions .66%
A
377.Ratio of net interest income to average net assets 5.13%
A
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED. TOTAL
RETURN WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING
THE PERIOD SHOWN. SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
For the period ended March 31, 1995
1. SIGNIFICANT ACCOUNTING POLICIES.
U.S. Treasury, U.S. Treasury II, U.S. Government, Domestic Money Market and
Money Market Portfolios are funds of Fidelity Institutional Cash Portfolios
(a trust). Fidelity U.S. Treasury Income Portfolio is a fund of Daily Money
Fund (a trust). Fidelity Institutional Tax-Exempt Cash Portfolios is a fund
of a trust of the same name. Each 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 Delaware business trust and is authorized
to issue an unlimited number of shares. On February 8, 1995, the Trustees
of Fidelity Institutional Tax-Exempt Cash Portfolios and the Trustees of
Fidelity U.S. Treasury Income Portfolio approved a change in the fiscal
year-end of each fund to March 31. Accordingly, the financial statements of
Fidelity Institutional Tax-Exempt Cash Portfolios and Fidelity U.S.
Treasury Income Portfolio are presented as of and for the ten-month and
eight-month periods ended March 31, 1995, respectively.
Each fund of Fidelity Institutional Cash Portfolios currently offers two
classes of shares, Class A and Class B, each of which has equal rights as
to earnings, assets and voting privileges except that each class bears
different distribution and transfer agent expenses and certain registration
fees. Each class has exclusive voting rights with respect to its
distribution plans. As of March 31, 1995, Class B shares were not
operational for the U.S. Treasury fund.
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. For
Fidelity Institutional Tax-Exempt Cash Portfolios, accretion of market
discount represents unrealized gain until realized at the time of a
security disposition or maturity.
ALLOCATED EARNINGS AND EXPENSES. FIDELITY INSTITUTIONAL CASH PORTFOLIOS:
Interest income, expenses (other than expenses incurred under the
Distribution and Service Plan, Transfer Agent Agreement and certain
registration fees for each class) and realized and unrealized gains or
losses on investments are allocated to each class of shares based upon
their relative net assets.
FIDELITY U.S. TREASURY INCOME PORTFOLIO: 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.
DELAYED DELIVERY TRANSACTIONS. Each 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. Each fund
identifies securities as segregated in its custodial records with a value
at least equal to the amount of the purchase commitment.
REPURCHASE AGREEMENTS. The funds of Fidelity Institutional Cash Portfolios,
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.
REVERSE REPURCHASE AGREEMENTS. Each fund of Fidelity Institutional Cash
Portfolios (except U.S. Treasury II) is permitted to engage in reverse
repurchase agreements for temporary purposes. The U.S. Treasury fund
engaged in reverse repurchase agreements during the period, earning net
interest income of $89,713, which is included in Interest Income on the
Statement of Operations.
JOINT TRADING ACCOUNT. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the funds of Fidelity Institutional
Cash Portfolios, 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 and Money Market funds,
and Fidelity Institutional Tax-Exempt Cash Portfolios are 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 $22,000,000 or 2.8% of net assets for
Domestic Money Market fund, $44,000,000 or 0.8% of net assets for Money
Market fund and $22,500,000 or 1.2% of net assets for Fidelity
Institutional Tax-Exempt Cash Portfolios.
3. JOINT TRADING ACCOUNT.
At the end of the period, the U.S. Treasury, U.S. Treasury II and U.S.
Government funds of Fidelity Institutional Cash Portfolios had 20% or more
of their 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 March 31, 1995 and due April 3, 1995. The
maturity values of the joint trading account investments were $529,273,398
at 6.20%, $61,699,018 at 6.23% and $263,319,925 at 6.24% for U.S. Treasury
fund, $3,149,626,170 at 6.20% and $332,298,444 at 6.23% for U.S. Treasury
II fund, and $251,768,919 at 6.24% and $1,001,982,267 at 6.33% for U.S.
Government fund. The investments in repurchase agreements through the joint
trading account are summarized as follows:
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 6.20% 28 14.5% $ 17,509,591,000 $ 17,518,640,314 $ 17,913,776,926
0%-15.75% 4/6/95-2/15/25
At 6.20% 10 35.6% $ 4,771,000,000 $ 4,773,464,567 $ 4,876,084,071 0%-14.00%
5/15/95-2/15/25
At 6.23% 5 20.4% $ 540,000,000 $ 540,280,375 $ 552,085,587 0%-14.00%
5/15/95-2/15/25
At 6.24% 7 37.2% $ 1,908,426,000 $ 1,909,418,890 $ 1,948,841,061 0%-15.75%
4/6/95-2/15/25
At 6.33% 4 44.4% $ 2,700,000,000 $ 2,701,424,250 $ 2,801,049,764 0%-14.25%
4/5/95-10/1/32
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, FMR receives a fee that
is computed daily at an annual rate of .20% of average net assets for the
funds of Fidelity Institutional Cash Portfolios and for Fidelity
Institutional Tax-Exempt Cash Portfolios.
For Fidelity U.S. Treasury Income Portfolio, 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 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 of Fidelity Institutional Cash Portfolios Class B, and in accordance
with Rule 12b-1 of the 1940 Act, each Class B fund, except U.S. Government
fund, pays Fidelity Distributors Corporation (FDC), an affiliate of FMR, a
distribution and service fee that is based on an annual rate of up to .32%
of its average net assets. U.S. Government fund pays FDC at an annual rate
of up to .25% of its average net assets. For the period, Class B of the U.S.
Treasury II, U.S. Government, Domestic Money Market and Money Market funds
paid FDC $418,917, $331,170, $52,640,and $812,749, respectively, of which
$395,473, $44,728, $52,030 and $784,046 was paid to securities dealers,
banks and other financial institutions for selling shares and providing
shareholder support services on behalf of Class B of the U.S. Treasury II,
U.S. Government, Domestic Money Market and Money Market funds, respectively.
TRANSFER AGENT FEES. Fidelity Investments Institutional Operations Company
(FIIOC), an affiliate of FMR, is the transfer, dividend disbursing and
shareholder servicing agent for the funds of Fidelity Institutional Cash
Portfolios. United Missouri Bank, N.A. (the Bank) is the custodian and
transfer and shareholder servicing agent for Fidelity Institutional
Tax-Exempt Cash Portfolios. The Bank has entered into a sub-contract with
FIIOC to perform the activities associated with the transfer and
shareholder servicing agent functions for Fidelity Institutional Tax-Exempt
Cash Portfolios. During the period April 1, 1994 to December 31, 1994 for
the funds of Fidelity Institutional Cash Portfolios, and June 1, 1994 to
December 31, 1994 for Fidelity Institutional Tax-Exempt Cash Portfolios,
FIIOC received fees based on the type, size, number of accounts and the
number of transactions made by shareholders. Effective January 1, 1995, the
Board of Trustees approved a revised transfer agent fee contract pursuant
to which FIIOC receives account fees and asset-based fees that vary
according to account size. FIIOC pays for typesetting, printing and mailing
of all shareholder reports, except proxy statements. For the ten-month
period ended March 31, 1995, FIIOC received transfer and shareholder
servicing agent fees amounting to $309,306 for Fidelity Institutional
Tax-Exempt Cash Portfolios.
ACCOUNTING FEES. Fidelity Service Co. (FSC), an affiliate of FMR, maintains
the accounting records for the funds of Fidelity Institutional Cash
Portfolios. The Bank also has a sub-contract with FSC to maintain Fidelity
Institutional Tax-Exempt Cash Portfolios' accounting records. The
accounting fee is based on the level of average net assets for the month
plus out-of-pocket expenses. For the ten month period ended March 31, 1995,
FSC received accounting fees amounting to $237,209 for Fidelity
Institutional Tax-Exempt Cash Portfolios.
5. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse the funds' operating expenses
(excluding interest, taxes, brokerage commissions, extraordinary expenses,
and 12b-1 fees payable by Class B shares of the funds of Fidelity
Institutional Cash Portfolios) above an annual rate of .18% of average net
assets for Fidelity Institutional Cash Portfolios and Fidelity
Institutional Tax-Exempt Cash Portfolios, and .20% of average net assets
for Fidelity U.S. Treasury Income Portfolio. Effective July 1, 1995, the
expense limitation for Fidelity Institutional Cash Portfolios (excluding
the Money Market fund) and Fidelity Institutional Tax-Exempt Cash
Portfolios will increase to .20% of average net assets.
FIDELITY INSTITUTIONAL CASH PORTFOLIOS. For the period, the reimbursement
reduced expenses by $822,285, $3,539,319, $1,936,406, $866,856 and
$3,002,430 for the U.S. Treasury, U.S. Treasury II, U.S. Government,
Domestic Money Market and Money Market funds, respectively.
FIDELITY INSTITUTIONAL TAX-EXEMPT CASH PORTFOLIOS. For the ten-month period
ended March 31, 1995, the reimbursement reduced expenses by $1,429,650.
FIDELITY U.S. TREASURY INCOME PORTFOLIO. For the eight-month period ended
March 31, 1995, the reimbursement reduced expenses by $1,719,806.
6. 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:
NUMBER OF
FUND SHAREHOLDERS % OWNERSHIP
U.S. Treasury 2 35%
U.S. Treasury II 2 23%
U.S. Government 1 13%
Domestic Money Market 1 26%
Money Market 1 22%
7. SHARE TRANSACTIONS.
Share transactions for both classes of the U.S. Treasury II, U.S.
Government, Domestic Money Market and Money Market funds of Fidelity
Institutional Cash Portfolios at net asset value of $1.00 per share were as
follows:
YEAR ENDED YEAR ENDED
MARCH 31, 1995** MARCH 31,1994*
U.S. TREASURY II CLASS A
Proceeds from sales of shares $ 51,629,761,018 $ 37,652,306,847
Reinvestment of dividends from net interest income 66,481,161 53,681,583
Shares redeemed (51,559,646,169) (38,743,519,132)
Net increase (decrease) in net assets and shares resulting from share
transactions $ 136,596,010 $ (1,037,530,702)
U.S. TREASURY II CLASS B*
Proceeds from sales of shares $ 4,121,373,809 $ 11,853,621
Reinvestment of dividends from net interest income 1,891,594 14,790
Shares redeemed (3,542,818,006) (6,692,877)
Net increase (decrease) in net assets and shares resulting from share
transactions $ 580,447,397 $ 5,175,534
(*) Share transactions for U.S. Treasury II Class B are for the period
October 22, 1993 (commencement of sale of shares) to March 31, 1994.
U.S. GOVERNMENT CLASS A
Proceeds from sales of shares $ 25,831,576,012 $ 33,376,241,019
Reinvestment of dividends from net interest income 70,455,356 54,284,929
Shares redeemed (26,344,771,188) (35,351,904,003)
Net increase (decrease) in net assets and shares resulting from share
transactions $ (442,739,820) $ (1,921,378,055)
U.S. GOVERNMENT CLASS B**
Proceeds from sales of shares $ 264,194,203 $ -
Reinvestment of dividends from net interest income 736,478 -
Shares redeemed (224,408,715) -
Net increase (decrease) in net assets and shares resulting from share
transactions $ 40,521,966 $ -
(**) Share transactions for U.S. Government Class B are for the period
April 4, 1994 (commencement of sale of shares) to March 31, 1995.
DOMESTIC MONEY MARKET CLASS A
Proceeds from sales of shares $ 7,602,650,013 $ 6,042,925,540
Reinvestment of dividends from net interest income 11,742,701 6,177,168
Shares redeemed (7,499,385,324) (6,196,482,006)
Net increase (decrease) in net assets and shares resulting from share
transactions $ 115,007,390 $ (147,379,298)
DOMESTIC MONEY MARKET CLASS B**
Proceeds from sales of shares $ 273,550,017 $ -
Reinvestment of dividends from net interest income 779,088 -
Shares redeemed (247,781,428) -
Net increase (decrease) in net assets and shares resulting from share
transactions $ 26,547,677 $ -
(**) Share transactions for Domestic Money Market Class B are for the
period July 19, 1994 (commencement of sale of shares) to March 31, 1995.
MONEY MARKET CLASS A
Proceeds from sales of shares $ 46,997,530,563 $ 48,632,985,539
Reinvestment of dividends from net interest income 141,162,693
59,354,442
Shares redeemed (45,208,411,681) (49,824,192,759)
Net increase (decrease) in net assets and shares resulting from share
transactions $ 1,930,281,575 $ (1,131,852,778)
MONEY MARKET CLASS B*
Proceeds from sales of shares $ 1,727,673,441 $ 112,664,085
Reinvestment of dividends from net interest income 10,646,994 379,584
Shares redeemed (1,370,385,613) (23,548,202)
Net increase (decrease) in net assets and shares resulting from share
transactions $ 367,934,822 $ 89,495,467
(*) Share transactions for Money Market Class B are for the period November
17, 1993 (commencement of sale of shares) to March 31, 1994.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees and Shareholders of Fidelity Institutional Tax-Exempt Cash
Portfolios and To the Trustees of Daily Money Fund and the Shareholders of
Fidelity U.S. Treasury Income Portfolio:
We have audited the accompanying statements of assets and liabilities,
including the schedules of portfolio investments, the related statements of
operations and changes in net assets, and the financial highlights of
Fidelity Institutional Tax-Exempt Cash Portfolios and Daily Money Fund:
Fidelity U.S. Treasury Income Portfolio as listed on pages 37 to 52 and 53
to 57, respectively, of this annual report. These financial statements and
financial highlights are the responsibility of the Fidelity Institutional
Tax-Exempt Cash Portfolios' and Daily Money Fund: Fidelity U.S. Treasury
Income Portfolio'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 which 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. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. Our procedures
included confirmation of securities owned as of March 31, 1995 by
correspondence with the custodians and brokers. 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
as of March 31, 1995 and the results of operations, changes in net assets
and the financial highlights for each of the periods indicated on pages 49
to 52 and 54 to 57 of this annual report for Fidelity Institutional
Tax-Exempt Cash Portfolios and Daily Money Fund: Fidelity U.S. Treasury
Income Portfolio, respectively, in conformity with generally accepted
accounting principles.
COOPERS & LYBRAND L.L.P.
Dallas, Texas
April 26, 1995
To the Trustees and Shareholders of Fidelity Institutional Cash Portfolios
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments, and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of the
U.S. Treasury Portfolio, the U.S. Treasury Portfolio II, the U.S.
Government Portfolio, the Domestic Money Market Portfolio and the Money
Market Portfolio (constituting Fidelity Institutional Cash Portfolios,
hereafter referred to as the "Fund") at March 31, 1995, the results of each
of their operations for the year then ended, the changes in each of their
net assets for each of the two years in the period then ended and the
financial highlights for each of the five years in the period then ended,
in conformity with generally accepted accounting principles. These
financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Fund's management;
our responsibility is to express an opinion on these financial statements
based on our audits. We conducted our audits of these financial statements
in accordance with generally accepted auditing standards which require that
we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting
principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that
our audits, which included confirmation of securities owned at March 31,
1995 by correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above.
PRICE WATERHOUSE LLP
Dallas, Texas
May 4, 1995
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, PRESIDENT
J. Gary Burkhead, SENIOR VICE PRESIDENT
Leland Barron, VICE PRESIDENT
Fred L. Henning, Jr., VICE PRESIDENT
Burnell Stehman, VICE PRESIDENT
John Todd, VICE PRESIDENT
Sarah H. Zenoble, VICE PRESIDENT
Arthur S. Loring, SECRETARY
Stephen P. Jonas, TREASURER
Thomas D. Maher, ASSISTANT VICE PRESIDENT
Michael D. Conway, ASSISTANT TREASURER
John H. Costello, ASSISTANT TREASURER
Leonard M. Rush, ASSISTANT TREASURER
BOARD OF 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
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER SERVICING AGENT
Fidelity Investments Institutional Operations Company
Boston, MA
United Missouri Bank, N.A.
Kansas City, MO
FIDELITY INSTITUTIONAL TAX-EXEMPT CASH PORTFOLIOS CUSTODIANS
Morgan Guaranty Trust Company of New York
New York, NY
FIDELITY INSTITUTIONAL CASH PORTFOLIOS:
U.S. TREASURY, U.S. GOVERNMENT, DOMESTIC MONEY MARKET
AND MONEY MARKET
DAILY MONEY FUND: FIDELITY U.S. TREASURY INCOME PORTFOLIO
Bank of New York
New York, NY
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY II
United Missouri Bank, N.A.
Kansas City, MO
FIDELITY INSTITUTIONAL TAX-EXEMPT CASH PORTFOLIOS
<PAGE>
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
<PAGE>
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.
<PAGE>
U.S. TREASURY PORTFOLIO
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
<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
<PAGE>
Statement of Operations
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>
<PAGE>
Statement of Changes in Net Assets
<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>
<PAGE>
FINANCIAL HIGHLIGHTS
<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.
<PAGE>
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
<PAGE>
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:
(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.
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.
<PAGE>
U.S. GOVERNMENT PORTFOLIO
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
<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
<PAGE>
Statement of Operations
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>
<PAGE>
Statement of Changes in Net Assets
<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>
<PAGE>
FINANCIAL HIGHLIGHTS
<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.
<PAGE>
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:
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
<PAGE>
FIDELITY MONEY MARKET TRUST
SEMIANNUAL REPORT
FEBRUARY 28, 1995
FIDELITY MONEY MARKET TRUST: U.S. TREASURY PORTFOLIO
INVESTMENTS/FEBRUARY 28, 1995 (UNAUDITED)
(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 - 27.6%
U.S. TREASURY BILLS - 19.1%
5/4/95 5.68% $ 3,000,000 $ 2,970,560 9931349X
7/13/95 6.63 6,000,000 5,856,732 912992FU
7/27/95 6.40 4,000,000 3,898,044 912992LU
8/10/95 6.29 9,000,000 8,752,950 912992NU
8/24/95 5.48 5,000,000 4,872,889 9931348H
8/31/95 (a) 6.00 3,000,000 2,909,000 912992RV
29,260,175
U.S. TREASURY NOTES - 8.5%
4/30/95 5.54 4,000,000 3,988,220 993993MJ
5/15/95 5.66 2,000,000 2,000,091 993993MT
5/15/95 6.23 2,000,000 1,998,357 993993QE
5/15/95 6.33 2,000,000 1,997,949 993993QL
5/15/95 6.45 2,000,000 2,007,960 993993RC
5/15/95 6.46 1,000,000 998,672 993993RK
12,991,249
TOTAL U.S. TREASURY OBLIGATIONS 42,251,424
Repurchase Agreements - 72.4%
In a joint trading account
(U.S. Treasury Obligations)
dated 2/28/95, due 3/1/95:
At 6.08% $ 70,011,829 $ 70,000,000 99799QTV
(U.S. Government Obligations)
dated 2/28/95, due 3/1/95:
At 6.10% 40,642,887 40,636,000 99799QTX
TOTAL REPURCHASE AGREEMENTS 110,636,000
TOTAL INVESTMENTS - 100% $ 152,887,424
Total Cost for Income Tax Purposes - $152,887,424
LEGEND:
(f) Security purchased on a delayed delivery basis (see Note 2 of Notes to
Financial Statements).
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.
<PAGE>
U.S. TREASURY PORTFOLIO
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
<S> <C> <C>
February 28, 1995 (Unaudited)
ASSETS
Investment in securities, at value (including repurchase agreements of $110,636,000) - See accompanying $ 152,887,424
schedule
Interest receivable 241,520
TOTAL ASSETS 153,128,944
LIABILITIES
Payable for investments purchased $ 2,909,000
Delayed delivery
Dividends payable 228,293
Accrued management fee 48,381
TOTAL LIABILITIES 3,185,674
NET ASSETS $ 149,943,270
Net Assets consist of:
Paid in capital $ 149,983,590
Accumulated net realized gain (loss) on investments (40,320)
NET ASSETS, for 149,983,590 shares outstanding $ 149,943,270
NET ASSET VALUE, offering price and redemption price per share ($149,943,270 (divided by) 149,983,590 shares) $1.00
<PAGE>
Statement of Operations
Six Months Ended February 28, 1995 (Unaudited)
INTEREST INCOME $ 4,223,334
EXPENSES
Management fee $ 337,027
Non-interested trustees' compensation 423
TOTAL EXPENSES 337,450
NET INTEREST INCOME 3,885,884
NET REALIZED GAIN (LOSS) ON (2,447)
INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 3,883,437
</TABLE>
<PAGE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS YEAR
ENDED ENDED
FEBRUARY 28, 1995 AUGUST 31, 1994
(UNAUDITED)
INCREASE (DECREASE) IN NET ASSETS
Operations $ 3,885,884 $ 5,206,766
Net interest income
Net realized gain (loss) (2,447) (19,591)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 3,883,437 5,187,175
Dividends to shareholders from net interest income (3,885,884) (5,206,766)
Share transactions at net asset value of $1.00 per share 477,738,867 901,345,282
Proceeds from sales of shares
Reinvestment of dividends from net interest income 2,487,879 3,627,764
Cost of shares redeemed (508,876,676) (911,811,257)
Net increase (decrease) in net assets and shares resulting from share transactions (28,649,930) (6,838,211)
TOTAL INCREASE (DECREASE) IN NET ASSETS (28,652,377) (6,857,802)
NET ASSETS
Beginning of period 178,595,647 185,453,449
End of period $ 149,943,270 $ 178,595,647
</TABLE>
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C>
SIX MONTHS YEARS ENDED AUGUST 31, TEN MONTHS YEARS ENDED OCTOBER 31,
ENDED ENDED
FEBRUARY 28, 1995 AUGUST 31,
(UNAUDITED) 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 $ 1.000
Income from Investment Operations
.024 .032 .029 .033 .061 .079
Net interest income
Less Distributions
(.024) (.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 $ 1.000
TOTAL RETURN B
2.44% 3.21% 2.89% 3.37% 6.24% 8.19%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted)
$ 149,943 $ 178,596 $ 185,453 $ 191,984 $ 215,610 $ 253,705
Ratio of expenses to average net assets
.42%A .42% .42% .42%A .42% .42%
Ratio of net interest income to average
4.84%A 3.15% 2.86% 4.00%A 6.12% 7.91%
net assets
</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/FEBRUARY 28, 1995 (UNAUDITED)
(Showing Percentage of Total Value of Investments)
<PAGE>
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 - 46.0%
FEDERAL FARM CREDIT BANK - DISCOUNT NOTES - 1.9%
5/2/95 5.81% $ 4,000,000 $ 3,961,078 313993RV
FEDERAL HOME LOAN BANK - AGENCY COUPONS - 3.8%
3/1/95 6.03 (a) 6,000,000 5,998,603 313390ZC
3/1/95 6.58 (a) 2,000,000 1,997,453 313389U9
7,996,056
FEDERAL HOME LOAN BANK - DISCOUNT NOTES - 5.7%
4/24/95 5.80 5,000,000 4,957,700 567995KB
5/5/95 5.95 4,000,000 3,958,256 567995KC
6/13/95 6.83 3,000,000 2,942,800 567995KN
11,858,756
FEDERAL HOME LOAN MORTGAGE CORP. - DISCOUNT NOTES - 2.3%
4/3/95 6.40 2,780,000 2,763,996 3559932L
5/16/95 6.03 2,000,000 1,974,920 3559934X
4,738,916
FEDERAL NATIONAL MORTGAGE ASSOC. - AGENCY COUPONS - 2.9%
3/1/95 6.60 (a) 6,000,000 6,000,000 9931287F
FEDERAL NATIONAL MORTGAGE ASSOC. - DISCOUNT NOTES - 24.6%
3/20/95 5.36 6,000,000 5,983,470 995021UR
3/31/95 5.60 3,000,000 2,986,375 995021VU
3/31/95 6.22 3,000,000 2,984,725 9950242M
4/5/95 5.74 3,000,000 2,983,725 9950212A
4/18/95 5.66 4,000,000 3,970,667 9950214C
5/11/95 5.98 3,000,000 2,965,683 9950218N
5/16/95 6.03 2,000,000 1,974,920 9950249E
5/17/95 6.14 5,000,000 4,936,261 9950219D
5/22/95 6.03 2,000,000 1,972,940 9950249J
6/2/95 6.51 3,000,000 2,951,175 995024BV
6/28/95 6.40 5,000,000 4,897,032 9950244U
7/10/95 6.72 2,000,000 1,952,694 9950243B
7/11/95 6.73 2,000,000 1,952,260 9950243A
8/7/95 6.38 5,000,000 4,863,525 9950245X
8/8/95 6.38 2,000,000 1,945,067 9950245Y
8/17/95 6.35 2,000,000 1,942,258 9950248X
51,262,777
STUDENT LOAN MARKETING ASSOC. - AGENCY COUPONS - 4.8%
3/1/95 6.36 (a) 5,000,000 5,000,703 863871QF
3/7/95 6.23 (a) 5,000,000 5,000,000 863990PS
10,000,703
TOTAL FEDERAL AGENCIES 95,818,286
U.S. Treasury Obligations - 7.0%
U.S. TREASURY BILLS
8/24/95 5.48% $ 5,000,000 $ 4,872,889 9931348H
8/31/95 (b) 6.00 10,000,000 9,696,667 912992SU
TOTAL U.S. TREASURY OBLIGATIONS 14,569,556
Medium-Term Notes - 0.8%
EXPORT-IMPORT BANK, U.S. (AS GUARANTOR FOR K.A. LEASING, LTD.)
3/15/95 6.25 (a) 1,642,879 1,642,879 530993AA
<PAGE>
MATURITY
AMOUNT
Repurchase Agreements - 46.2%
With First Boston Corporation:
At 6.00%, dated 2/27/95 due 3/6/95:
U.S. Government Obligations
(principal amount $10,479,792)
5.467%, 4/1/34 $ 10,011,667 10,000,000 31699M4K
In a joint trading account
(U.S. Treasury Obligations)
dated 2/28/95, due 3/1/95:
At 6.10% 24,077,078 24,073,000 99799QTY
(U.S. Government Obligations)
dated 2/28/95, due 3/1/95:
At 6.14% 62,010,575 62,000,000 99799QTU
TOTAL REPURCHASE AGREEMENTS 96,073,000
TOTAL INVESTMENTS - 100% $ 208,103,721
Total Cost for Income Tax Purposes - $208,103,721
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 (see Note 2 of Notes to
Financial Statements).
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.
<PAGE>
U.S. GOVERNMENT PORTFOLIO
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
<S> <C> <C>
February 28, 1995 (Unaudited)
ASSETS
Investment in securities, at value (including repurchase agreements of $96,073,000) - See accompanying $ 208,103,721
schedule
Interest receivable 180,815
TOTAL ASSETS 208,284,536
LIABILITIES
Payable for investments purchased $ 9,696,667
Delayed delivery
Share transactions in process 502,404
Dividends payable 288,592
Accrued management fee 64,976
TOTAL LIABILITIES 10,552,639
NET ASSETS $ 197,731,897
Net Assets consist of:
Paid in capital $ 197,704,630
Accumulated net realized gain (loss) on investments 27,267
NET ASSETS, for 197,704,630 shares outstanding $ 197,731,897
NET ASSET VALUE, offering price and redemption price per share ($197,731,897 (divided by) 197,704,630 shares) $1.00
<PAGE>
Statement of Operations
Six Months Ended February 28, 1995 (Unaudited)
INTEREST INCOME $ 5,024,780
EXPENSES
Management fee $ 386,345
Non-interested trustees' compensation 461
TOTAL EXPENSES 386,806
NET INTEREST INCOME 4,637,974
NET REALIZED GAIN (LOSS) ON (8,673)
INVESTMENTS
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 4,629,301
</TABLE>
<PAGE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS YEAR
ENDED ENDED
FEBRUARY 28, 1995 AUGUST 31, 1994
(UNAUDITED)
INCREASE (DECREASE) IN NET ASSETS
Operations $ 4,637,974 $ 5,594,259
Net interest income
Net realized gain (loss) (8,673) (27,868)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 4,629,301 5,566,391
Dividends to shareholders from net interest income (4,637,974) (5,594,259)
Share transactions at net asset value of $1.00 per share 517,350,084 754,973,945
Proceeds from sales of shares
Reinvestment of dividends from net interest income 2,912,198 3,543,173
Cost of shares redeemed (494,899,687) (792,649,688)
Net increase (decrease) in net assets and shares resulting from share transactions 25,362,595 (34,132,570)
TOTAL INCREASE (DECREASE) IN NET ASSETS 25,353,922 (34,160,438)
NET ASSETS
Beginning of period 172,377,975 206,538,413
End of period $ 197,731,897 $ 172,377,975
</TABLE>
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C>
SIX MONTHS YEARS ENDED AUGUST 31, TEN MONTHS YEARS ENDED OCTOBER 31,
ENDED ENDED
FEBRUARY 28, 1995 AUGUST 31,
(UNAUDITED) 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 $ 1.000
Income from Investment Operations
.025 .032 .029 .035 .062 .079
Net interest income
Less Distributions
(.025) (.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 $ 1.000
TOTAL RETURN B
2.49% 3.29% 2.95% 3.53% 6.41% 8.20%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted)
$ 197,732 $ 172,378 $ 206,538 $ 356,698 $ 400,699 $ 473,450
Ratio of expenses to average net assets
.42%A .42% .42% .42%A .42% .42%
Ratio of net interest income to average
5.04%A 3.23% 2.92% 4.18%A 6.27% 7.91%
net assets
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD ENDED FEBRUARY 28, 1995 (UNAUDITED)
8. SIGNIFICANT ACCOUNTING POLICIES.
U.S. Treasury, U.S. Government, and Domestic Money Market Portfolios (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. At a special meeting of
the shareholders of the funds held on December 8, 1994, shareholders
approved an Agreement and Plan of Conversion and Termination (the Plan of
Conversion), providing for the conversion of the funds from a separate
series of a Massachusetts business trust, to a separate series of a
Delaware business trust, effective December 29, 1994. The individual
investment objective, policies and limitations of the funds remain the
same, except for the proposals approved by shareholders on December 8,
1994. 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.
9. 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 funds, 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. Each 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. Each fund
may receive compensation for interest forgone in a delayed delivery
transaction. Each fund identifies securities as segregated in its custodial
records with a value at least equal to the amount of the purchase
commitment.
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 $21,999,860 or 7.5% of net assets.
10. JOINT TRADING ACCOUNT.
At the end of the period, the following funds had 20% or more of their
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 February 28, 1995 and due March 1, 1995. The maturity values of the
joint trading account investments were $70,011,829 at 6.08% and $40,642,887
at 6.10% for U.S. Treasury fund and $24,077,078 at 6.10% and $62,010,575 at
6.14% for U.S. Government fund. The investments in repurchase agreements
through the joint trading account are summarized as follows:
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 6.08% 9 29.7% $ 4,556,000,000 $ 4,556,769,900 $ 4,649,160,356 0%-15.75%
3/16/95-2/15/21
At 6.10% 7 24.2% $ 825,677,000 $ 825,816,879 $ 844,183,428 0%-13.875%
3/1/95-2/15/25
At 6.10% 6 17.2% $ 580,000,000 $ 580,098,304 $ 596,844,412 0%-12%
3/16/95-8/15/23
At 6.14% 6 34.8% $ 2,875,070,000 $ 2,875,560,394 $ 2,954,395,558 0%-13.875%
4/1/96-2/1/29
11. 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.
In connection with the Plan of Conversion, a new Management Contract, new
Sub-Advisory Agreement and new Distribution and Service Plan identical to
those previously in effect became effective on December 29,1994.
12. 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 36
Domestic Money Market Portfolio 2 22
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.
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
SUB-ADVISER
FMR Texas Inc.
Irving, TX
OFFICERS
Edward C. Johnson 3d, PRESIDENT
J. Gary Burkhead, SENIOR VICE PRESIDENT
Leland Barron, VICE PRESIDENT
Fred L. Henning, Jr., VICE PRESIDENT
Burnell Stehman, VICE PRESIDENT
Arthur S. Loring, SECRETARY
Stephen P. Jonas, TREASURER
Thomas D. Maher, ASSISTANT VICE PRESIDENT
Michael D. Conway, ASSISTANT TREASURER
John H. Costello, ASSISTANT TREASURER
Leonard M. Rush, ASSISTANT TREASURER
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
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-4-95S
<PAGE>
PART C - OTHER INFORMATION
Item 15. Indemnification
---------------
Pursuant to Del. Code Ann. title 12 (sub-section) 3817, a Delaware
business trust may provide in its governing instrument for the
indemnification of its officers and trustees from and against any and all
claims and demands whatsoever. Article X, Section 10.02 of the
Declaration of Trust states that the Registrant shall indemnify any
present trustee or officer to the fullest extent permitted by law against
liability, and all expense reasonably incurred by him or her in connection
with any claim, action, suit or proceeding in which he or she is involved
by virtue of his or her service as a trustee, officer, or both, and
against any amount incurred in settlement thereof. Indemnification will
not be provided to a person adjudged by a court or other adjudicatory body
to be liable to the Registrant or its shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of his or
her duties (collectively, "disabling conduct"), or not to have acted in
good faith in the reasonable belief that his or her action was in the best
interest of the Registrant. In the event of a settlement, no
indemnification may be provided unless there has been a determination, as
specified in the Declaration of Trust, that the officer or trustee did not
engage in disabling conduct.
Pursuant to Section 11 of the Distribution Agreement, the Registrant
agrees to indemnify and hold harmless the Distributor and each of its
directors and officers and each person, if any, who controls the
Distributor within the meaning of Section 15 of the 1933 Act against any
loss, liability, claim, damages or expense arising by reason of any person
acquiring any shares, based upon the ground that the registration
statement, Prospectus, Statement of Additional Information, shareholder
reports or other information filed or made public by the Registrant
included a materially misleading statement or omission. However, the
Registrant does not agree to indemnify the Distributor or hold it harmless
to the extent that the statement or omission was made in reliance upon,
and in conformity with, information furnished to the Registrant by or on
behalf of the Distributor. The Registrant does not agree to indemnify the
parties against any liability to which they would be subject by reason of
their own disabling conduct.
Pursuant to the agreement by which Fidelity Service Company (Service)
is appointed sub-transfer agent, the Transfer Agent agrees to indemnify
Service for its losses, claims, damages, liabilities and expenses to the
extent the Transfer Agent is entitled to and receives indemnification from
the Registrant for the same events. Under the Transfer Agency Agreement,
the Registrant agrees to indemnify and hold the Transfer Agent harmless
against any losses, claims, damages, liabilities, or expenses resulting
from:
(1) any claim, demand, action or suit brought by any person other
than the Registrant, which names the Transfer Agent and/or the Registrant
as a party and is not based on and does not result from the Transfer
<PAGE>
Agent's willful misfeasance, bad faith, negligence or reckless disregard
of its duties, and arises out of or in connection with the Transfer
Agent's performance under the Transfer Agency Agreement; or
(2) any claim, demand, action or suit (except to the extent
contributed to by the Transfer Agent's willful misfeasance, bad faith,
negligence or reckless disregard of its duties) which results from the
negligence of the Registrant, or from the Transfer Agent's acting upon any
instruction(s) reasonably believed by it to have been executed or
communicated by any person duly authorized by the Registrant, or as a
result of the Transfer Agent's acting in reliance upon advice reasonably
believed by the Transfer Agent to have been given by counsel for the
Registrant, or as a result of the Transfer Agent's acting in reliance upon
any instrument or stock certificate reasonably believed by it to have been
genuine and signed, countersigned or executed by the proper person.
Item 16. Exhibits
--------
1. Declaration of Trust, as amended and restated on April 9, 1985
is incorporated herein by reference to Exhibit 1 to Post-Effective
Amendment No. 2.
2. Bylaws of the Trust are incorporated herein by reference to
Exhibit 2 to Post-Effective Amendment No. 2.
3. Not applicable.
4. Agreement and Plan of Reorganization and Liquidation among
Fidelity Money Market Trust: U.S. Government Portfolio, Fidelity
Instititutional Cash Portfolios: Government, and Fidelity Management &
Research Company is filed herein as Exhibit 4 to the Proxy Statement and
Prospectus.
5. Not applicable.
6. (a) Management Contract between Fidelity Institutional Cash
Portfolios: Money Market Portfolio and Fidelity Management & Research
Company, dated September 1, 1986, is incorporated herein by reference to
Exhibit 5(a) to Post-Effective Amendment No. 7.
(b) Management Contract between Fidelity Institutional Cash
Portfolios: U.S. Treasury Portfolio and Fidelity Management & Research
Company, dated September 1, 1986, is incorporated herein by reference to
Exhibit 5(b) to Post-Effective Amendment No. 7.
(c) Management Contract between Fidelity Institutional Cash
Portfolios: U.S. Government Portfolio and Fidelity Management & Research
Company, dated June 30, 1985, is incorporated herein by reference in
Exhibit 5(c) to Post-Effective Amendment No. 7.
(d) Management Contract between Fidelity Institutional Cash
Portfolios: U.S. Treasury Portfolio II and Fidelity Management & Research
Company, dated December 1, 1986, is incorporated herein by reference to
Exhibit 5(d) to Post-Effective Amendment No. 8.
<PAGE>
(e) Management Contract between Fidelity Institutional Cash
Portfolios: Domestic Money Market Portfolio and Fidelity Management &
Research Company, dated December 1, 1986, is incorporated herein by
reference to Exhibit 5(e) to Post-Effective Amendment. No. 8.
(f) Sub-Advisory agreement between Fidelity Management &
Research Company on behalf of Fidelity Institutional Cash Portfolios: U.S.
Treasury Portfolio and FMR Texas Inc., dated December 1, 1989, is
incorporated herein by reference to Exhibit 5(f) to Post-Effective
Amendment No. 13.
(g) Sub-Advisory agreement between Fidelity Management &
Research Company on behalf of Fidelity Institutional Cash Portfolios:
U.S. Treasury Portfolio II and FMR Texas Inc., dated December 1, 1989, is
incorporated herein by reference to Exhibit 5(g) to Post-Effective
Amendment No. 13.
(h) Sub-Advisory agreement between Fidelity Management &
Research Company on behalf of Fidelity Institutional Cash Portfolios: U.S.
Government Portfolio and FMR Texas Inc., dated December 1, 1989, is
incorporated herein by reference to Exhibit 5(h) to Post-Effective
Amendment No. 13.
(i) Sub-Advisory agreement between Fidelity Management &
Research Company on behalf of Fidelity Institutional Cash Portfolios:
Domestic Money Market Portfolio and FMR Texas Inc., dated November 1,
1989, is incorporated herein by reference to Exhibit 5(i) to
Post-Effective Amendment No. 13.
(j) Sub-Advisory agreement between Fidelity Management &
Research Company on behalf of Fidelity Institutional Cash Portfolios:
Money Market Portfolio and FMR Texas Inc., dated December 1, 1989, is
incorporated herein by reference to Exhibit 5(j) to Post-Effective
Amendment No. 13.
7. (a) General Distribution Agreement between Registrant and
Fidelity Distributors Corporation, dated June 11, 1985, is incorporated
herein by reference to Exhibit 6(a) to Post-Effective Amendment No. 4.
(b) Amendment to General Distribution Agreement between
Registrant and Fidelity Distributors Corporation, dated January 1, 1988,
is incorporated herein by reference to Exhibit 6(b) to Post-Effective
Amendment No. 9.
8. Retirement Plan for Non-Interested Person Trustees, Directors or
General Partners effective November 1, 1989 is incorporated herein by
reference to Exhibit 7 to Post-Effective Amendment No. 17.
9. (a) Custodian Contract between the Registrant and First
National Bank of Boston, dated June 11, 1985, is incorporated herein by
reference to Exhibit 8(a) to Post-Effective Amendment No. 4.
<PAGE>
(b) Amendment to the Custodian Contract between Registrant and
First National Bank of Boston, dated November 29, 1985, is incorporated
herein by reference to Exhibit 8(b) to Post-Effective Amendment No. 4.
(c) Custodian Agreement between the Registrant and Morgan
Guaranty Trust Company of New York, dated July 18, 1991, is incorporated
herein by reference to Exhibit 8(c) to Post-Effective Amendment No. 17.
(d) Custodian Agreement, Appendix A, and Appendix C, dated
December 1, 1994, between The Bank of New York and Fidelity Institutional
Cash Portfolios Trust on behalf of Treasury II is incorporated herein by
reference to Exhibit 8(d) to Fidelity Hereford Street Trust's
Post-Effective Amendment No. 4 (File No. 33-52577).
(e) Appendix B, dated December 15, 1994, to the Custodian
Agreement, dated December 1, 1994, between The Bank of New York and
Fidelity Institutional Cash Portfolios Trust on behalf of Treasury II is
incorporated herein by reference to Exhibit 8(e) to Fidelity Hereford
Street Trust's Post-Effective Amendment No. 4 (File No. 33-52577).
(f) Custodian Agreement, Appendix A, and Appendix C, dated
December 1, 1994, between Morgan Guaranty Trust Co. of New York and
Fidelity Institutional Cash Portfolios Trust on behalf of Treasury,
Government, Domestic and Money Market is incorporated herein by reference
to Exhibit 8(f) to Fidelity Hereford Street Trust's Post-Effective
Amendment No. 4 (File No. 33-52577).
(g) Appendix B, dated December 15, 1994, to the Custodian
Agreement, dated December 1, 1994, between Morgan Guaranty Trust Co. of
New York and Fidelity Institutional Cash Portfolios Trust on behalf of
Treasury, Government, Domestic and Money Market is incorporated herein by
reference to Exhibit 8(g) to Fidelity Hereford Street Trust's
Post-Effective Amendment No. 4 (File No. 33-52577).
10. (a) Distribution and Service Plan of Fidelity Institutional
Cash Portfolios: Money Market Portfolio is incorporated herein by
reference to Exhibit 15(a) to Post-Effective Amendment No. 6.
(b) Distribution and Service Plan of Fidelity Institutional
Cash Portfolios: U.S. Treasury Portfolio is incorporated herein by
reference to Exhibit 15(b) to Post-Effective Amendment No. 6.
(c) Distribution and Service Plan of Fidelity Institutional
Cash Portfolios: U.S. Government Portfolio is incorporated herein by
reference to Exhibit 15(c) to Post-Effective Amendment No. 6.
(d) Distribution and Service Plan of Fidelity Institutional
Cash Portfolios: U.S. Treasury Portfolio II is incorporated herein by
reference to Exhibit 15(d) to Post-Effective Amendment No. 8.
(e) Distribution and Service Plan of Fidelity Institutional
Cash Portfolios: Domestic Money Market Portfolio is incorporated herein by
reference to Exhibit 15(e) to Post-Effective Amendment No. 8.
<PAGE>
(f) A Form of Distribution and Service Plan pursuant to Rule
12b-1, for each of the portfolios of Fidelity Institutional Cash
Portfolios: Class B, is incorporated herein by reference to Exhibit 15(f)
to Post-Effective Amendment No. 19.
11. Opinion and Consent of Kirkpatrick & Lockhart LLP as to the
legality of shares is filed herein as Exhibit 11.
12. Opinion and Consent of Kirkpatrick & Lockhart LLP as to tax
matters in connection with the reorganization of Fidelity Money Market
Trust: U.S. Government Portfolio is filed herein as Exhibit 12.
13. (a) Transfer Agency Agreement between the Registrant and First
National Bank of Boston, dated June 11, 1985, is incorporated herein by
reference to Exhibit 9(a) to Post-Effective Amendment No. 4.
(b) Sub-Transfer Agent Agreement between FMR Corp., Fidelity
Service Co. and First National Bank of Boston, dated June 11, 1985, is
incorporated herein by reference to Exhibit 9(b) to Post-Effective
Amendment No. 4.
(c) Pricing Agreement between the Registrant and First National
Bank of Boston, dated June 11, 1985, is incorporated herein by reference
to Exhibit 9(c) to Post-Effective Amendment No. 4.
(d) Appointment of Sub-Pricing Agent Agreement between FMR
Corp., Fidelity Service Co., and First National Bank of Boston, dated June
11, 1985, is incorporated herein by reference to Exhibit 9(d) to
Post-Effective Amendment No. 4.
(e) Transfer Agency Agreement between Fidelity Institutional
Cash Portfolios: U.S. Treasury Portfolio II and First National Bank of
Boston, dated February 2, 1987, is incorporated herein be reference to
Exhibit 9(e) to Post-Effective Amendment No. 9.
(f) Transfer Agency Agreement between Fidelity Institutional
Cash Portfolios: Domestic Money Market Portfolio and First National Bank
of Boston, dated March 12, 1987, is incorporated herein by reference to
Exhibit 9(f) to Post-Effective Amendment No. 9.
(g) Amendment to Schedule A of Transfer Agent Agreement between
Fidelity Institutional Cash Portfolios: U.S. Treasury Portfolio, and First
National Bank of Boston, dated June 1, 1990, is incorporated herein by
reference to Exhibit 9(g) to Post-Effective Amendment No. 15.
(h) Amendment to Schedule A of Transfer Agent Agreement between
Fidelity Institutional Cash Portfolios: U.S. Treasury Portfolio II and
First National Bank of Boston, dated June 1, 1990, is incorporated herein
by reference to Exhibit 9(h) to Post-Effective Amendment No. 15.
(i) Amendment to Schedule A of Transfer Agent Agreement between
Fidelity Institutional Cash Portfolios: U.S. Government Portfolio and
<PAGE>
First National Bank of Boston, dated June 1, 1990, is incorporated herein
by reference to Exhibit 9(i) to Post-Effective Amendment No. 15.
(j) Amendment to Schedule A of Transfer Agent Agreement between
Fidelity Institutional Cash Portfolios: Domestic Money Market Portfolio
and First National Bank of Boston, dated June 1, 1990, is incorporated
herein by reference to Exhibit 9(j) to Post-Effective Amendment No. 15.
(k) Amendment to Schedule A of Transfer Agent Agreement between
Fidelity Institutional Cash Portfolios: Money Market Portfolio and First
National Bank of Boston, dated June 1, 1990, is incorporated herein by
reference to Exhibit 9(k) to Post-Effective Amendment No. 15.
(l) Amended Transfer Agency Agreement between the Registrant
and First National Bank of Boston, dated June 1, 1989, is incorporated
herein by reference to Exhibit 9(l) to Post-Effective Amendment No. 15.
(m) Amended Service Agreement between the Registrant and First
National Bank of Boston, dated June 1, 1989, is incorporated herein by
reference to Exhibit 9(m) to Post-Effective Amendment No. 15.
(n) Appointment of Sub-Transfer Agent Agreement between FMR
Corp., Fidelity Investments Institutional Operations Company and First
National Bank of Boston, dated June 1, 1989, is incorporated herein by
reference to Exhibit 9(n) to Post-Effective Amendment No. 15.
(o) Appointment of Sub-Servicing Agent Agreement between FMR
Corp., Fidelity Service Co., and First National Bank of Boston, dated June
1, 1989, is incorporated herein by reference to Exhibit 9(o) to
Post-Effective Amendment No. 15.
(p) Schedule As of Transfer Agent Agreement between Fidelity
Institutional Cash Portfolios: U.S. Treasury Portfolio, U.S. Treasury
Portfolio II, U.S. Government Portfolio, Domestic Money Market Portfolio
and Money Market Portfolio and First National Bank of Boston, dated June
1, 1989, is incorporated herein by reference to Exhibit 9(p) to
Post-Effective Amendment No. 15.
(q) Schedule Bs of Transfer Agent Agreement between Fidelity
Institutional Cash Portfolios: U.S. Treasury Portfolio, U.S. Treasury
Portfolio II, U.S. Government Portfolio, Domestic Money Market Portfolio
and Money Market Portfolio and First National Bank of Boston, dated June
1, 1989, is incorporated herein by reference to Exhibit 9(q) to
Post-Effective Amendment No. 15.
(r) Schedule Cs of Transfer Agent Agreement between Fidelity
Institutional Cash Portfolios: U.S. Treasury Portfolio, U.S. Treasury
Portfolio II, U.S. Government Portfolio, Domestic Money Market Portfolio
and Money Market Portfolio and First National Bank of Boston, dated June
1, 1989, is incorporated herein by reference to Exhibit 9(r) to
Post-Effective Amendment No. 15.
(s) Termination of the Amended Transfer Agent Agreement and the
Amended Service Agreement between Fidelity Institutional Cash Portfolios
<PAGE>
and the First National Bank of Boston is incorporated herein by reference
to Exhibit 9(s) to Post-Effective Amendment No. 15.
14. (a) Consent of Coopers & Lybrand, L.L.P. is filed herein as
Exhibit 14(a).
(b) Consent of Price Waterhouse LLP is filed herein as Exhibit
14(b).
15. Not applicable.
16. Not applicable.
17. Rule 24f-2 Notice for Registrant's most recent fiscal year ended
March 31, 1995 is filed herein as Exhibit 17.
Item 17. Undertakings
------------
(1) The undersigned Registrant agrees that prior to any public
reoffering of the securities registered through the use of the prospectus
which is a part of this Registration Statement by any person or party who
is deemed to be an underwriter within the meaning of Rule 145(c) of the
Securities Act of 1933, the reoffering prospectus will contain the
information called for by any applicable registration form for reofferings
by persons who may be deemed underwriters, in addition to the information
called for by the other items of the applicable form.
(2) The undersigned Registrant agrees that every prospectus that is
filed under paragraph (1) above will be filed as a part of an amendment to
the Registration Statement and will not be used until the amendment is
effective, and that, in determining any liability under the Securities Act
of 1933, each post-effective amendment shall be deemed to be a new
Registration Statement for the securities offered therein, and the
offering of the securities at that time shall be deemed to be the initial
bona fide offering of them.
<PAGE>
SIGNATURES
As required by the Securities Act of 1933, this Registration
Statement has been signed on behalf of the Registrant, in the City of
Boston, and the Commonwealth of Massachusetts, on the 7th day of June
1995.
FIDELITY INSTITUTIONAL CASH PORTFOLIOS
/s/ Edward C. Johnson 3d, President
By _____________________________________
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.
<TABLE>
<CAPTION>
(Signature) (Title) (Date)
------------ ------- ------
<S> <C> <C>
/s/ Edward C. Johnson 3d President and Trustee June , 1995
________________________ (Principal Executive Officer)
Edward C. Johnson 3d *
/s/ Stephen P. Jonas Treasurer June , 1995
________________________
Stephen P. Jonas
/s/ J. Gary Burkhead Trustee June , 1995
________________________
J. Gary Burkhead *
/s/ Ralph F. Cox Trustee June , 1995
________________________
Ralph F. Cox *
/s/ Phyllis Burke Davis Trustee June , 1995
________________________
Phyllis Burke Davis *
/s/ Richard J. Flynn Trustee June , 1995
________________________
Richard J. Flynn *
/s/ E. Bradley Jones Trustee June , 1995
________________________
E. Bradley Jones *
/s/ Donald J. Kirk Trustee June , 1995
________________________
Donald J. Kirk *
<PAGE>
(Signature) (Title) (Date)
------------ ------- ------
/s/ Peter S. Lynch Trustee June , 1995
________________________
Peter S. Lynch *
/s/ Edward H. Malone Trustee June , 1995
________________________
Edward H. Malone *
/s/ Marvin L. Mann Trustee June , 1995
________________________
Marvin L. Mann *
/s/ Gerald C. McDonough Trustee June , 1995
________________________
Gerald C. McDonough *
/s/ Thomas R. Williams Trustee June , 1995
________________________
Thomas R. Williams *
</TABLE>
* Signature affixed by Stephanie A. Djinis pursuant to a power of
attorney dated December 15, 1994 and filed herewith.
<PAGE>
POWER OF ATTORNEY
------------------
We, the undersigned Directors, Trustees or General Partners, as the
case may be, of the following investment companies:
Daily Money Fund Fidelity Institutional Tax-Exempt
Daily Tax-Exempt Money Fund Cash Portfolios
Fidelity Beacon Street Trust Fidelity Institutional Investors
Fidelity California Municipal Trust Trust
II Fidelity Money Market Trust II
Fidelity Court Street Trust II Fidelity Municipal Trust II
Fidelity Hereford Street Trust Fidelity New York Municipal Trust II
Fidelity Institutional Cash Fidelity Phillips Street Trust
Portfolios Fidelity Union Street Trust II
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 A. Djinis, 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 fifteenth day of December, 1994.
/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
<PAGE>
POWER OF ATTORNEY
-----------------
I, the undersigned Treasurer and principal financial and accounting
officer of the following investment companies:
Daily Money Fund Fidelity Institutional Tax-Exempt Cash
Daily Tax-Exempt Money Fund Portfolios
Fidelity Beacon Street Trust Fidelity Institutional Investors Trust
Fidelity California Municipal Fidelity Money Market Trust II
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 Fidelity Union Street Trust II
Portfolios
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 Treasurer and principal financial and
accounting officer (collectively, the Funds ), hereby constitute and
appoint John H. Costello, my true and lawful attorney-in-fact, with full
power of substitution, and with full power to him to sign for me and in my
name, in the appropriate capacity 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 deems necessary or
appropriate, to comply with the provisions of the Securities Act of 1933
and the Investment Company Act of 1940, and all related requirements of
the Securities and Exchange Commission. I hereby ratify and confirm all
that said attorney-in-fact or his substitutes may do or cause to be done
by virtue hereof.
WITNESS my hand on the date set forth below.
/s/Stephen P. Jonas March 1, 1995
-----------------------
Stephen P. Jonas
<PAGE>
<PAGE>
EXHIBIT 4
AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
THIS AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION (the
Agreement) is made as of the [19] day of June, 1995 by and among U.S.
Government Portfolio (FMMT Government), a fund of Fidelity Money Market
Trust (FMMT), Government (FICP Government), a fund of Fidelity
Institutional Cash Portfolios (FICP), and Fidelity Management & Research
Company (FMR). (FMMT and FICP may hereinafter be referred to collectively
as the "Trusts" or individually as a "Trust".) Each trust is a duly
organized business trust under the laws of the State of Delaware and FMR
is a Massachusetts corporation, each with its principal place of business
at 82 Devonshire Street, Boston, Massachusetts 02109.
This Agreement is intended to be, and is adopted as, a plan of
reorganization and liquidation within the meaning of Section 368(a)(1)(C)
of the United States Internal Revenue Code of 1986, as amended (the Code).
The reorganization (Reorganization) will comprise the transfer of
substantially all of the assets of FMMT Government in exchange solely for
Class A Shares of beneficial interest of FICP Government, and the
assumption by FICP Government of FMMT Government's liabilities, followed
by the constructive distribution, after the Closing Date hereinafter
referred to, of such Class A Shares of FICP Government to the shareholders
of FMMT Government in liquidation of FMMT Government as provided herein,
all upon the terms and conditions hereinafter set forth in this Agreement.
In consideration of the premises and of the covenants and agreements
hereinafter set forth, the parties hereto covenant and agree as follows:
1. TRANSFER OF ASSETS AND ASSUMPTION OF LIABILITIES OF FMMT GOVERNMENT
IN EXCHANGE FOR CLASS A SHARES OF FICP GOVERNMENT AND LIQUIDATION OF
FMMT GOVERNMENT
1. As of the date of this Agreement, FICP Government offers two
classes of shares, Class A and Class B and FMMT Government offers one
class of shares. As contemplated herein, in exchange for
substantially all of the assets of FMMT Government and the assumption
by FICP Government of FMMT Government's liabilities, FICP Government
shall deliver Class A Shares of FICP Government to FMMT Government.
2. Subject to the terms and conditions herein set forth, and on the
basis of the representations and warranties contained herein, FMMT
Government agrees to transfer its assets as set forth in paragraph
1.3 to FICP Government and FICP Government agrees to assume FMMT
Government's liabilities described in paragraph 1.4 hereof, and
deliver to FMMT Government in exchange therefor the number of Class A
Shares of FICP Government equal in value (calculated in the manner
and as of the time set forth in paragraph 2.2) to the net asset value
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per share of FMMT Government (calculated in the manner and as of the
time set forth in paragraph 2.1) multiplied by the number of shares
of FMMT Government then outstanding.
3. The assets of FMMT Government to be acquired by FICP Government
shall include substantially all cash, cash equivalents, securities,
receivables (including interest or dividends receivable), claims,
choses in action, and other property owned by FMMT Government and any
deferred or prepaid expenses shown as an asset on the books of FMMT
Government on the closing date.
4. The liabilities to be assumed by FICP Government shall include
(except as otherwise provided herein) all of FMMT Government's
liabilities, debts, obligations, and duties of whatever kind or
nature, whether absolute, accrued, contingent or otherwise, arising
in the ordinary course of business. Notwithstanding the foregoing,
FMMT Government agrees to use its best efforts to discharge all of
its known liabilities prior to the Closing Date.
5. In order for FMMT Government to comply with Section 852(a)(1) of
the Code and to avoid having any taxable income in the short taxable
year ending with its dissolution, FMMT Government will, prior to the
Closing Date, as defined below, declare a dividend so that it will
have declared dividends of substantially all of its investment
company taxable income and net realized capital gain, if any, for
such taxable year.
6. As provided in paragraph 3.4, as soon after the Closing Date as
is conveniently practicable (the Liquidation Date), FMMT Government
will liquidate and distribute pro rata to its shareholders of record,
determined as of the close of business on the Closing Date, the FICP
Government Class A Shares received by FMMT Government pursuant to
Article 1 in exchange for their interest in FMMT Government evidenced
by their shares of beneficial interest in FMMT Government shares.
Such liquidation and distribution will be accomplished by the
transfer of the shares then credited to the account of FMMT
Government on the books of FICP Government, to open accounts on the
share records of FICP Government in the names of the FMMT Government
shareholders and representing the respective pro rata number of FICP
Government Class A Shares due such shareholders. FICP Government
shall not issue certificates representing its shares in connection
with such exchange. Fractional shares of FICP Government shall be
rounded to the third decimal place.
7. Ownership of FICP Government Class A Shares will be shown on the
books of FICP Government's transfer agent. FICP Government Class A
Shares will be issued in the manner described in FICP Government's
current Class A Prospectus and Statement of Additional Information.
8. Any transfer taxes payable upon the issuance of Class A Shares of
FICP Government in a name other than the registered holder of the
shares on the books of FMMT Government as of that time shall be paid
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by the person to whom such shares are to be issued as a condition of
such transfer.
9. Any reporting responsibility of FMMT Government is and shall
remain the responsibility of FMMT Government up to and including the
Closing Date and such later date on which FMMT Government is
liquidated.
2. VALUATION
1. The net asset value per share of FMMT Government's shares shall
be computed as of the close of business on the Closing Date, using
the valuation procedures set forth in FMMT Government's then current
Prospectus or Statement of Additional Information.
2. The value of FICP Government Class A Shares shall be the net
asset value per share computed as of the Closing Date, using the
valuation procedures set forth in FICP Government's then current
Class A Prospectus or Statement of Additional Information.
3. All computations of value shall be made by Fidelity Service Co.,
a division of FMR Corp., in accordance with its regular practice as
pricing agent for FICP Government and FMMT Government.
3. CLOSING AND CLOSING DATE
1. The Closing Date shall be October 31, 1995, or such other date
as the parties may agree in writing. All acts taking place at the
Closing shall be deemed to take place simultaneously as of 5:00 p.m.
Eastern time on the Closing Date unless otherwise provided. The
Closing shall be held at 5:00 p.m. Eastern time at the office of FMMT
or at such other time and/or place as the parties may agree.
2. Morgan Guaranty Trust Company of New York, as custodian for FMMT
Government and FICP Government (the Custodian), shall deliver at the
Closing a certificate of an authorized officer stating the (a) FMMT
Government's portfolio securities, cash, and other assets have been
delivered in proper form to FICP Government prior to close of
business on the Closing Date; and (b) all necessary taxes including
all applicable Federal and state stock transfer stamps, if any, shall
have been paid, or provision for payment shall have been made by FMMT
Government, in conjunction with the delivery of portfolio securities.
3. In the event that on the Closing Date (a) The Federal Reserve
Bank of New York is closed, (b) the market for government securities
is closed to trading or trading thereon is restricted, or (c) trading
or the reporting of trading on said market or elsewhere is disrupted
so that accurate appraisal of the value of the total net assets of
FMMT Government and FICP Government is impracticable, the Closing
Date shall be postponed until the first business day after the day
when trading shall have been fully resumed and reporting shall have
been restored, or such other date as the parties may agree.
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4. Fidelity Investments Institutional Operations Co. (FIIOC), as
transfer agent for FMMT Government and FICP Government, shall deliver
at the Closing a list of the names and addresses of FMMT Government's
shareholders and the number and percentage ownership of outstanding
shares owned by each such shareholder of FMMT Government, all as of
the close of business on the Closing Date, certified by an officer of
FIIOC. FICP Government shall issue and deliver to the Secretary or
Assistant Secretary of FMMT Government a confirmation evidencing the
Class A Shares of FICP Government to be credited on the Liquidation
Date, or provide evidence satisfactory to FMMT Government that such
Class A Shares of FICP Government have been credited to FMMT
Government's account on the books of FICP Government. At the
Closing, each party shall deliver to the other such bills of sale,
checks, assignments, stock certificates, receipts or other documents
as such other party or its counsel may reasonably request.
4. REPRESENTATIONS AND WARRANTIES
1. FMMT Government represents and warrants as follows:
A. FMMT Government is a series of FMMT, a Delaware business
trust duly organized, validly existing and in good standing
under the laws of the State of Delaware;
B. FMMT is an open-end, management investment company duly
registered under the Investment Company Act of 1940 (the 1940
Act), and such registration is in full force and effect;
C. FMMT Government is not in, and the execution, delivery and
performance of this Agreement will not result in, violation of
any provision of the Trust Instrument or By-Laws of FMMT, or, to
the knowledge of FMMT Government, of any agreement, indenture,
instrument, contract, lease or other undertaking to which FMMT
Government is a party or by which FMMT Government is bound;
D. FMMT Government has no material contracts or other
commitments (other than this Agreement) which will not be
terminated without liability to FMMT Government prior to the
Closing Date;
E. No material litigation or administrative proceeding or
investigation of or before any court or governmental body is
presently pending or to the knowledge of FMMT Government
threatened against FMMT Government or any of its properties or
assets, except as previously disclosed in writing to FICP
Government. FMMT Government knows of no facts which might form
the basis for the institution of such proceedings, and FMMT
Government is not a party to or subject to the provisions of any
order, decree or judgment of any court or governmental body
which materially and adversely affects its business or its
ability to consummate the transactions herein contemplated;
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<PAGE>
F. The Statement of Assets and Liabilities, the Statement of
Operations, the Statement of Changes in Net Assets, Per-Share
Data and Ratios, and the Schedule of Investments of FMMT
Government at August 31, 1994 which have been audited by Coopers
& Lybrand L.L.P., independent accountants, in accordance with
generally accepted auditing standards, and unaudited statements
for the six months ended February 28, 1995, have been furnished
to FICP Government. Such financial statements are presented in
accordance with generally accepted accounting principles, and
fairly present, in all material respects, the financial
condition of FMMT Government as of such dates, and there are no
material known liabilities of FMMT Government at such date
(contingent or otherwise) not disclosed therein;
G. Since August 31, 1994, there has not been any material
adverse change in FMMT Government's financial condition, assets,
liabilities or business, other than changes occurring in the
ordinary course of business;
H. At the date hereof and at the Closing Date, all Federal and
other tax returns and reports of FMMT Government required by law
to have been filed by such dates shall have been filed, and all
Federal and other taxes shall have been paid so far as due, or
provision shall have been made for the payment thereof, and, to
the best of FMMT Government's knowledge, no such return is
currently under audit and no assessment has been asserted with
respect to such returns;
I. For the taxable fiscal years from October 31, 1985 through
October 31, 1991, the fiscal period from November 1, 1991
through August 31, 1992, and for each subsequent taxable fiscal
year ended August 31 through the fiscal year ended August 31,
1994, FMMT Government has met the requirements of Subchapter M
of the Code for qualification and treatment as a regulated
investment company and intends to meet such requirements for its
taxable year ending with its dissolution;
J. All issued and outstanding FMMT Government shares are, and
at the Closing Date will be, duly and validly issued and
outstanding, fully paid and nonassessable as a matter of
Delaware law. All of the issued and outstanding FMMT Government
shares will, at the time of Closing, be held by the persons and
in the amounts set forth in the list of shareholders submitted
to FICP Government in accordance with the provisions of
paragraph 3.4 hereof.
K. At the Closing Date, FMMT Government will have good and
marketable title to its assets to be transferred to FICP
Government pursuant to paragraph 1.2 hereof, and full right,
power and authority to sell, assign, transfer and deliver such
assets hereunder free of any liens or other encumbrances, and
upon delivery and payment for such assets, FICP Government will
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<PAGE>
acquire good and marketable title thereto, subject to no
restrictions on the full transfer thereof, including such
restrictions as might arise under the Securities Act of 1933, as
amended (the 1933 Act);
L. The execution, delivery and performance of this Agreement
will have been duly authorized prior to the Closing Date by all
necessary corporate action on the part of FMMT Government, and
this Agreement constitutes a valid and binding obligation of
FMMT Government enforceable in accordance with its terms,
subject to shareholder approval;
M. The information to be furnished by FMMT Government for use
in applications for orders, registration statements, proxy
materials and other documents which may be necessary in
connection with the transactions contemplated hereby shall be
accurate and complete and shall comply in all material respects
with Federal securities and other laws and regulations
thereunder applicable thereto;
N. The proxy statement of FMMT Government to be included in
the registration statement filed with the Securities and
Exchange Commission by FMMT on Form N-14 relating to the FICP
Government Class A Shares issuable thereunder, and any
supplement or amendment thereto (the Registration Statement), on
the effective date of the Registration Statement, at the time of
the meeting of FMMT Government's shareholders, and on the
Closing Date (i) will comply in all material respects with the
provisions of the Securities Exchange Act of 1934 (the 1934 Act)
and the 1940 Act and the rules and regulations thereunder, and
(ii) will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
O. FMMT Government will declare to shareholders of record, on
or prior to the Closing Date, one or more dividends or
distributions which, together with all previous such dividends
or distributions, shall have the effect of distributing to the
shareholders substantially all of its investment company taxable
income and net realized capital gains, if any, as of the Closing
Date;
P. FMMT Government will, from time to time, as and when
requested by FICP Government, execute and deliver or cause to be
executed and delivered, all such assignments and other
instruments, and will take or cause to be taken such further
action, as FICP Government may deem necessary or desirable in
order to vest in and confirm to FICP Government title to and
possession of all the assets of FMMT Government to be sold,
assigned, transferred and delivered hereunder and otherwise to
carry out the intent and purpose of this Agreement;
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<PAGE>
Q. The execution and delivery of this Agreement does not, and
the consummation of the transactions contemplated hereby will
not, conflict with FMMT's Trust Instrument or By-Laws or, to
FMMT Government's knowledge, any provision of any agreement to
which FMMT Government is a party or by which it is bound or, to
the knowledge of FMMT Government, result in the acceleration of
any obligation or the imposition of any penalty under any
agreement, judgment or decree to which FMMT Government is a
party or by which it is bound;
R. To FMMT Government's knowledge, no consent, approval,
authorization or order of any court or governmental authority is
required for the consummation by FMMT Government of the
transactions contemplated herein, except such as have been
obtained under the 1933 Act, the 1934 Act, and the 1940 Act and
such as may be required under state securities laws; and
S. The fair market value of the assets of FMMT Government will
equal or exceed the liabilities to be assumed by FICP Government
and to which the assets are subject.
T. FMMT Government's liabilities to be assumed by FICP
Government were incurred in the ordinary course of business.
2. FICP Government represents and warrants as follows:
A. FICP Government is a series of FICP, a Delaware business
trust duly organized, validly existing and in good standing
under the laws of the State of Delaware;
B. FICP is an open-end, management investment company duly
registered under the 1940 Act, and such registration is in full
force and effect;
C. FICP Government is not in, and the execution, delivery and
performance of this agreement will not result in, violation of
any provisions of the Trust Instrument or By-Laws of FICP, or,
to the knowledge of FICP Government, of any agreement,
indenture, instrument, contract, lease or other undertaking to
which FICP Government is a party or by which FICP Government is
bound;
D. No material litigation or administrative proceeding or
investigation of or before any court or governmental body is
presently pending or, to the knowledge of FICP Government,
threatened against FICP Government or any of its properties or
assets, except as previously disclosed in writing to FMMT
Government. FICP Government knows of no facts which might form
the basis for the institution of such proceedings and FICP
Government is not a party to or subject to the provisions of any
order, decree or judgment of any court or governmental body
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<PAGE>
which materially and adversely affects its business or its
ability to consummate the transactions herein contemplated;
E. The Statement of Assets and Liabilities, the Statement of
Operations, the Statement of Changes in Net Assets, Per-Share
Data and Ratios and the Schedule of Investments of FICP
Government at March 31, 1995 (copies of which have been
furnished to FMMT Government) are presented in accordance with
generally accepted accounting principles, and fairly present, in
all material respects, the financial condition of FICP
Government as of such date, and there are no material known
liabilities of FICP Government at such date (contingent or
otherwise) not disclosed therein;
F. Since March 31, 1995, there has not been any material
adverse change in FICP Government's financial condition, assets,
liabilities or business other than changes occurring in the
ordinary course of business;
G. At the date hereof and at the Closing Date, all Federal and
other tax returns and reports of FICP Government required by law
to have been filed by such dates shall have been filed, and all
Federal and other taxes shall have been paid insofar as due, or
provision shall have been made for the payment thereof, and, to
the best of FICP Government's knowledge, no such return is
currently under audit and no assessment has been asserted with
respect to such returns;
H. For the taxable fiscal period from February 2, 1987 through
March 31, 1987 and for each subsequent taxable fiscal year ended
March 31 through the fiscal year ended March 31, 1995, FICP
Government has met the requirements of Subchapter M of the Code
for qualification and treatment as a regulated investment
company and intends to meet such requirements for its current
fiscal year;
I. All issued and outstanding FICP Government Class A Shares
are, and at the Closing will be, duly and validly issued and
outstanding, fully paid and non-assessable, under Delaware law;
J. The execution, delivery and performance of this Agreement
will have been duly authorized prior to the Closing Date by all
necessary corporate action on the part of FICP Government, and
this Agreement constitutes the valid and binding obligation of
FICP Government enforceable in accordance with its terms;
K. The FICP Government Class A Shares to be issued and
delivered to FMMT Government pursuant to the terms of this
Agreement will at the Closing Date have been duly authorized
and, when so issued and delivered, will be duly and validly
issued Class A Shares of FICP Government, fully paid and non-
assessable under Delaware law;
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<PAGE>
L. On the effective date of the Registration Statement, at the
time of the meeting of FMMT Government's shareholders, and on
the Closing Date, the Registration Statement (i) will comply in
all material respects with the provisions of the 1933 Act, the
1934 Act, and the 1940 Act and the rules and regulations
thereunder, and (ii) will not contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading; provided, however, that the representations and
warranties in this subsection shall not apply to statements in
or omissions from the Registration Statement made in reliance
upon and in conformity with information furnished by FMMT
Government for use in the Registration Statement;
M. The information to be furnished by FICP Government for use
in applications for orders, registration statements, proxy
materials and other documents which may be necessary in
connection with the transactions contemplated hereby shall be
accurate and complete and shall comply in all material respects
with Federal securities and other laws and regulations
applicable thereto;
N. FICP Government agrees to use all reasonable efforts to
obtain the approvals and authorizations required by the 1933
Act, the 1940 Act, and such of the state Blue Sky or securities
laws as it may deem appropriate in order to continue its
operations after the Closing Date;
O. FICP Government will, from time to time, as and when
requested by FMMT Government, execute and deliver or cause to be
executed and delivered, all such assignments and other
instruments, and will take and cause to be taken such further
action as FMMT Government may deem necessary or desirable in
order to vest in and confirm to FMMT Government, title to and
possession of all of the FICP Government's Class A Shares to be
sold, assigned, transferred and delivered hereunder and
otherwise to carry out the intent and purpose of this Agreement;
P. The execution and delivery of this Agreement does not, and
the consummation of the transactions contemplated hereby will
not, conflict with FICP's Trust Instrument or By-Laws, or to
FICP Government's knowledge, any provision of any agreement to
which FICP Government is a party or by which it is bound or, to
the knowledge of FICP Government, result in the acceleration of
any obligations or the imposition of any penalty under any
agreement, judgment or decree to which FICP Government is a
party or by which it is bound;
Q. To FICP Government's knowledge, no consent, approval,
authorization or order of any court or governmental authority is
required for the consummation by FICP Government of the
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transactions contemplated herein, except such as have been
obtained under the 1933 Act, the 1934 Act, and the 1940 Act and
such as may be required under state securities laws; and
5. COVENANTS OF FICP GOVERNMENT AND FMMT GOVERNMENT
1. FICP Government and FMMT Government each covenants to operate
its respective business in the ordinary course between the date
hereof and the Closing Date, it being understood that such ordinary
course of business will include customary dividends and
distributions.
2. FMMT Government covenants to call a shareholder meeting to
consider and act upon this Agreement and to take all other action
necessary to obtain approval of the transactions contemplated herein.
3. FMMT Government covenants that FICP Government Class A Shares to
be issued hereunder are not being acquired for the purpose of making
any distribution thereof other than in accordance with the terms of
this Agreement.
4. FMMT Government covenants that it will assist FICP Government in
obtaining such information as FICP Government reasonably requests
concerning the beneficial ownership of FMMT Government's shares.
5. Subject to the provisions of this Agreement, FICP Government and
FMMT Government each will take, or cause to be taken, all action, and
will do or cause to be done all things, reasonably necessary, proper
or advisable to consummate and make effective the transactions
contemplated by this Agreement.
6. FMMT Government covenants that as promptly as practicable, but
in any case within 180 days after the Closing Date, FICP Government
will be furnished with an analysis of the earnings and profits of
FMMT Government for Federal income tax purposes, which will be
carried over by FICP Government as a result of Section 381 of the
Code, and which will be certified by its Treasurer.
7. FMMT Government will prepare a Prospectus (the Prospectus) which
will include a Proxy Statement (the Proxy Statement), both documents
to be included in a Registration Statement on Form N-14 for Fidelity
Institutional Cash Portfolios (the Registration Statement) in
compliance with the 1933 Act, the 1934 Act, and the 1940 Act in
connection with the special shareholders meeting to consider approval
of this Agreement and the transactions contemplated herein.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF FMMT GOVERNMENT
The obligations of FMMT Government to consummate the transactions
provided for herein shall be subject, at its election, to the
performance by FICP Government of all the obligations to be performed
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by it hereunder on or before the Closing Date, and, in addition
thereto, the following further conditions:
1. All representations and warranties of FICP Government contained
in this Agreement shall be true and correct in all material respects
as of the date hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the Closing Date
with the same force and effect as if made on and as of the Closing
Date;
2. FICP Government shall have delivered to FMMT Government on the
Closing Date a certificate executed in its name by a duly authorized
officer of FICP, in form and substance satisfactory to FMMT
Government dated as of the Closing Date, to the effect that the
representations and warranties of FICP Government made in this
Agreement are true and correct at and as of the Closing Date except
as they may be affected by the transactions contemplated by this
Agreement, and as to such other matters as FMMT Government shall
reasonably request.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF FICP GOVERNMENT
The obligations of FICP Government to complete the transactions
provided for herein shall be subject, at its election, to the
performance by FMMT Government of all the obligations to be performed
by it hereunder on or before the Closing Date and, in addition
thereto, the following further conditions:
1. All representations and warranties of FMMT Government contained
in this Agreement shall be true and correct in all material respects
as of the date hereof, and except as they may be affected by the
transactions contemplated by this Agreement, as of the Closing Date
with the same force and effect as if made on and as of the Closing
Date;
2. FMMT Government shall have delivered to FICP Government a
statement of its assets and liabilities, together with a list of its
portfolio securities showing the tax costs of such securities by lot,
as of the Closing Date, certified by the Treasurer or Assistant
Treasurer of FMMT Government;
3. FMMT Government shall have delivered to FICP Government on the
Closing Date a certificate executed in its name by a duly authorized
officer of FMMT in form and substance satisfactory to FICP
Government, dated as of the Closing Date, to the effect that the
representations and warranties of FMMT Government made in this
Agreement are true and correct at and as of the Closing Date except
as they may be affected by the transactions contemplated by this
Agreement, and as to such other matters as FICP Government shall
reasonably request.
-11-
<PAGE>
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF FICP GOVERNMENT AND
FMMT GOVERNMENT
The obligations of FMMT Government hereunder are, at the option of
FICP Government, and the obligations of the FICP Government hereunder
are, at the option of FMMT Government, each subject to the further
conditions that on or before the Closing Date:
1. This Agreement and the transactions contemplated herein shall
have been approved by the requisite vote of the holders of the
outstanding shares of beneficial interest of FMMT Government in
accordance with the provisions of the law of business trusts of the
State of Delaware, and certified copies of the resolutions evidencing
such approval shall have been delivered to FICP Government;
2. On the Closing Date, no action, suit or other proceeding shall
be pending before any court or governmental agency in which it is
sought to restrain, prohibit, obtain damages or other relief in
connection with this Agreement or any of the transactions
contemplated herein;
3. All consents of other parties and all other consents, orders and
permits of Federal, state and local regulatory authorities (including
those of the Securities and Exchange Commission and of state Blue Sky
and securities authorities, including no-action" positions of such
Federal or state authorities) deemed necessary by FICP Government or
FMMT Government to permit consummation, in all material respects, of
the transactions contemplated hereby shall have been obtained, except
where failure to obtain any such consent, order or permit would not
involve a risk of a material adverse effect on the assets or
properties of FICP Government or FMMT Government, provided that
either party hereto may for itself waive any of such conditions;
4. The Registration Statement shall have become effective under the
1933 Act and no stop orders suspending the effectiveness thereof
shall have been issued and, to the best knowledge of parties hereto,
no investigation or proceeding for that purpose shall have been
instituted or be pending, threatened or contemplated under the 1933
Act;
5. FMMT Government will declare to shareholders of record, on or
prior to the Closing Date, one or more dividends or distributions
which, together with all previous such dividends or distributions,
shall have the effect of distributing to the shareholders
substantially all of its investment company taxable income and net
realized capital gain, if any, as of the Closing Date;
6. FMMT Government and FICP Government shall have received on or
before the Closing Date an opinion of Kirkpatrick & Lockhart LLP
satisfactory to FMMT Government and FICP Government, that for Federal
income tax purposes:
-12-
<PAGE>
A. The Reorganization will be a reorganization under section
368(a)(1)(C) of the Internal Revenue Code of 1986, as amended
("Code"), and FMMT Government and FICP Government will each be
parties to the reorganization under section 368(b) of the Code.
B. No gain or loss will be recognized by FMMT Government upon
the transfer of substantially all of its assets to FICP
Government in exchange solely for FICP Government Class A Shares
and FICP Government's assumption of FMMT Government's
liabilities followed by the distribution of those FICP
Government Class A Shares to the FMMT Government shareholders in
liquidation of FMMT Government.
C. No gain or loss will be recognized by FICP Government on
the receipt of FMMT Government's assets in exchange solely for
the FICP Government Class A Shares and the assumption of FMMT
Government's liabilities.
D. The basis of FMMT Government's assets in the hands of FICP
Government will be the same as the basis of such assets in FMMT
Government's hands immediately prior to the Reorganization.
E. FICP Government's holding period in the assets to be
received from FMMT Government will include FMMT Government's
holding period in such assets.
F. The FMMT Government shareholders will recognize no gain or
loss on the exchange of the shares of beneficial interest in
FMMT Government ("FMMT Government Shares") for the FICP
Government Class A Shares in the Reorganization.
G. The FMMT Government shareholders' basis in the FICP
Government Shares to be received by them will be the same as
their basis in the FMMT Government Shares to be surrendered in
exchange therefor.
H. The holding period of the FICP Government Class A Shares to
be received by the FMMT Government shareholders will include the
holding period of the FMMT Government Shares to be surrendered
in exchange therefor, provided those FMMT Government Shares were
held as capital assets on the date of the Reorganization.
Notwithstanding anything herein to the contrary, FMMT Government may
not waive the conditions set forth in this Paragraph 8.6.
9. BROKERAGE FEES AND EXPENSES
1. FICP Government and FMMT Government each represents and warrants
to the other that there are no brokers' or finders' fees payable in
connection with the transactions provided for herein.
-13-
<PAGE>
2. Fidelity Management & Research Company will assume expenses
incurred by FMMT and FMMT Government, in connection with entering
into and carrying out the provisions of this Agreement, whether or
not the transactions contemplated hereby are consummated. Such
expenses shall include, without limitation: (i) expenses incurred in
connection with the entering into and the carrying out of the
provisions of this Agreement; (ii) postage; (iii) printing; (iv)
accounting fees; (v) legal fees; and (vi) solicitation costs of the
transactions.
10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
1. FICP Government and FMMT Government agree that neither party has
made any representation, warranty or covenant not set forth herein
and that this Agreement constitutes the entire agreement between the
parties.
2. The representation, warranties, and covenants contained in the
Agreement or in any document delivered pursuant hereto or in
connection herewith shall survive the consummation of the
transactions contemplated hereunder.
11. TERMINATION
This Agreement may be terminated by the mutual agreement of FICP
Government and FMMT Government. In addition, either FICP Government
or FMMT Government may at its option terminate this Agreement at or
prior to Closing Date because:
1. of a material breach by the other of any representation,
warranty, or agreement contained herein to be performed at or prior
to the Closing Date; or
2. a condition herein expressed to be precedent to the obligations
of the terminating party has not been met and it reasonably appears
that it will not or cannot be met.
In the event of any such termination, there shall be no liability for
damages on the part of FICP Government or FMMT Government, or their
respective Trustees or officers.
12. AMENDMENT; WAIVER
1. This Agreement may be amended, modified or supplemented in such
manner as may be mutually agreed upon in writing by the respective
President, any Vice President or Treasurer of FMMT Government, FICP
Government, and FMR; provided, however, that following the
shareholders' meeting called by FMMT Government pursuant to Paragraph
5.2 of this Agreement, no such amendment may have the effect of
changing the provisions for determining the number of Class A Shares
of FICP Government to be paid to FMMT Government shareholders under
-14-
<PAGE>
this Agreement to the detriment of such shareholders without their
further approval.
2. At any time before the Closing Date, FICP Government or FMMT
Government may waive any of the conditions set forth herein, provided
that such waiver will not have a material adverse effect on the
shareholders' interests, and (b) FMMT Government may waive any of the
conditions set forth herein if, interests of such Fund's
shareholders.
13. NOTICES
Any notice, report, or demand required or permitted by any provision
of this Agreement shall be in writing and shall be given by prepaid
telegraph or prepaid certified mail addressed to Fidelity
Institutional Cash Portfolios, Fidelity Money Market Trust, or FMR as
appropriate, 82 Devonshire Street, Boston, Massachusetts 02109,
Attention: Arthur S. Loring.
14. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT
1. This Article and paragraph Headings contained in this Agreement
will have reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
2. This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original.
3. This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts.
4. The parties acknowledge that FICP is a Delaware business trust.
Notice is hereby given that this Agreement is executed on behalf of
the Trust's trustees solely in their capacity as trustees, and not
individually, and that the Trust's obligations under this Agreement
are not binding on or enforceable against any of its trustees,
officers, or shareholders, but are only binding on and enforceable
against the Trust's assets and property. Each party agrees that, in
asserting any rights or claims under this Agreement, it shall look
only to FICP Government's assets and property in settlement of such
rights or claims and not to such trustees or shareholders. Each
party agrees that their obligations hereunder apply only to FMMT
Government and FICP Government, respectively, and not to their
shareholders individually or to the Trustees of FICP or FMMT.
5. This Agreement shall bind and inure to the benefit of the
parties hereto and their respective successors and assigns, but no
assignment or transfer hereof or of any rights or obligations
hereunder shall be made by any party without the written consent of
the other parties. Nothing herein expressed or implied is intended
or shall be construed to confer upon or give any person, firm or
-15-
<PAGE>
corporation other than the parties hereto and their respective
successors and assigns any rights or remedies under or by reason of
this Agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed by an appropriate officer.
FIDELITY MONEY MARKET TRUST
on behalf of U.S. Government Portfolio
[Signature lines omitted]
FIDELITY INSTITUTIONAL CASH PORTFOLIOS
on behalf of Government
[Signature lines omitted]
FIDELITY MANAGEMENT & RESEARCH COMPANY [Signature lines omitted.]
-16-
<PAGE>
<PAGE>
Exhibit 11
KIRKPATRICK & LOCKHART LLP
SOUTH LOBBY - 9TH FLOOR
1800 M STREET, N.W.
WASHINGTON, D.C. 20036-5891
(202) 778-9000
June 20, 1995
Fidelity Institutional Cash Portfolios
82 Devonshire Street
Boston, Massachusetts 02109
Ladies and Gentlemen:
You have requested our opinion regarding certain matters in
connection with the issuance of shares of U.S. Government Portfolio ("FICP
Government"), a series of Fidelity Institutional Cash Portfolios (the
"Trust"), pursuant to a Registration Statement filed by the Trust on Form
N-14 ("Registration Statement") under the Securities Act of 1933 ("1933
Act"). FICP Government currently offers two classes of shares: Class A
and Class B. We understand that Class A Shares of FICP Government will be
issued in connection with the proposed acquisition by FICP Government of
substantially all of the assets of U.S. Government Portfolio ("FMMT
Government"), a series of Fidelity Money Market Trust, and the assumption
by FICP Government of the liabilities of FMMT Government, solely in
exchange for Class A shares of FICP Government.
We have, as counsel, participated in various business and other
matters relating to the Trust. We have examined copies, either certified
or otherwise proved to be genuine, of the Trust's Trust Instrument, the
minutes of the meetings of the trustees and other documents relating to
the organization and operation of the Trust and the authorization and
issuance of shares of beneficial interest of the Trust. Based upon this
examination, we are of the opinion that the shares to be issued pursuant
to the Registration Statement, when issued upon the terms provided in the
Registration Statement, subject to compliance with the 1933 Act, the
Investment Company Act of 1940, and applicable state law regulating the
offer and sale of securities, will be legally issued, fully paid, and non-
assessable.
The Trust is an entity of the type commonly known as a "Delaware
Business trust." Under Delaware law, shareholders of a business trust are
entitled to the same limitations of personal liability extended to
stockholders of private corporations for profit. The Trust's Trust
Instrument contains an express disclaimer of shareholder liability for the
debts, liabilities, obligations, and expenses of the Trust and any series
thereof and requires that a disclaimer be given in each contract entered
<PAGE>
Fidelity Institutional
Cash Portfolios
June 20, 1995
Page 2
into or executed by the Trust's trustees or by any series of the Trust.
The Trust Instrument provides (i) for indemnification out of a series'
property of any shareholder or former shareholder held personally liable
for the obligations of the series; and (ii) that a series shall, upon
request, assume the defense of any claim made against any shareholder for
any act or obligation of that series and satisfy any judgment thereon.
We hereby consent to the reference to our firm under the captions
"Federal Income Tax Consequences of the Reorganization," "Federal Income
Tax Considerations," and "Legal Matters" in the Proxy Statement and
Prospectus which constitutes a part of the Registration Statement. We
further consent to your filing a copy of this opinion as an exhibit to the
Registration Statement.
Yours truly,
/s/Kirkpatrick & Lockhart LLP
<PAGE>
<PAGE>
June 21, 1995
U.S. Government Portfolio
(a series of Fidelity Money Market Trust)
U.S. Government Portfolio
(a series of Fidelity Institutional
Cash Portfolios)
82 Devonshire Street
Boston, MA 02109
Ladies and Gentlemen:
Fidelity Money Market Trust ("FMMT"), a Delaware business trust,
on behalf of U.S. Government Portfolio ("FMMT Government"), a series of
FMMT, and Fidelity Institutional Cash Portfolios ("FICP"), a Delaware
business trust, on behalf of U.S. Government Portfolio ("FICP
Government"), a series of FICP, have requested our opinion as to certain
federal income tax consequences of a transaction ("Reorganization") in
which FICP Government will acquire all of the assets and assume all of the
liabilities of FMMT Government in exchange solely for Class A shares of
beneficial interest in FICP Government ("FICP Government Shares") pursuant
to an Agreement and Plan of Reorganization and Liquidation ("Agreement")
entered into between FMMT Government and FICP Government on June 21, 1995.
In rendering this opinion, we have examined the Agreement, the
prospectus/proxy statement furnished in connection with the
Reorganization, the currently effective prospectus and statement of
additional information of FMMT Government and FICP Government, and such
other documents as we have deemed necessary. We have also relied, with
your consent, on certificates of officers of FMMT Government and FICP
Government.
OPINION
Based solely on the facts and representations set forth in the
reviewed documents and the certificates of officers of FMMT Government and
FICP Government, and assuming that (i) those representations are true on
the date of the Reorganization and (ii) the Reorganization is consummated
in accordance with the Agreement, our opinion with respect to the federal
income tax consequences of the Reorganization is as follows.
1. The Reorganization will be a reorganization under section
368(a)(1)(C) of the Internal Revenue Code of 1986, as amended ("Code"),
and FMMT Government and FICP Government will each be parties to the
Reorganization under section 368(b) of the Code.
<PAGE>
2. No gain or loss will be recognized by FMMT Government
upon the transfer of all of its assets to FICP Government in
exchange solely for FICP Government Shares and FICP Government's
assumption of FMMT Government's liabilities followed by the distribution
of those FICP Government Shares to the FMMT Government shareholders in
liquidation of FMMT Government.
3. No gain or loss will be recognized by FICP Government on
the receipt of FMMT Government's assets in exchange solely for the FICP
Government Shares and the assumption of FMMT Government's liabilities.
4. The basis of FMMT Government's assets in the hands of
FICP Government will be the same as the basis of such assets in FMMT
Government's hands immediately prior to the Reorganization.
5. FICP Government's holding period in the assets to be
received from FMMT Government will include FMMT Government's holding
period in such assets.
6. The FMMT Government shareholders will recognize no gain
or loss on the exchange of the shares of beneficial interest in FMMT
Government ("FMMT Government Shares") for the FICP Government Shares in
the Reorganization.
7. The FMMT Government shareholders' basis in the FICP
Government Shares to be received by them will be the same as their basis
in the FMMT Government Shares to be surrendered in exchange therefor.
8. The holding period of the FICP Government Shares to be
received by the FMMT Government shareholders will include the holding
period of the FMMT Government Shares to be surrendered in exchange
therefor, provided those FMMT Government Shares were held as capital
assets on the date of the Reorganization.
The foregoing opinion is based on, and is conditioned on the
continued applicability of, the provisions of the Code and the regulations
thereunder, case law precedent, and the Internal Revenue Service
pronouncements in existence at the date hereof. We express no opinion
other than those contained herein.
We consent to the inclusion of this opinion in the registration
statement on form N-14 filed with the Securities and Exchange Commission
and the inclusion of the name "Kirkpatrick & Lockhart LLP" in the "Tax
Considerations" section of that registration statement.
Very truly yours,
Kirkpatrick & Lockhart LLP
<PAGE>
<PAGE>
Exhibit 14a
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement
of Fidelity Institutional Cash Portfolios on Form N-14 (File No. 33-_____)
of our report dated September 26, 1994, on our audit of the financial
statements and financial highlights of Fidelity Money Market Trust: U.S.
Government Portfolio. We also consent to the reference to our Firm under
the caption "Experts."
/s/ Coopers & Lybrand L.L.P.
Coopers & Lybrand L.L.P.
Dallas, Texas
June 13, 1995
<PAGE>
<PAGE>
Exhibit 14(b)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Proxy Statement
and Prospectus ("the Proxy/Prospectus") constituting part of this
registration statement on Form N-14 (the "Registration Statement") of
Fidelity Institutional Cash Portfolios (the "Trust") of our report dated
May 4, 1995, relating to the financial statements and financial highlights
(the "Financial Statements") appearing in the March 31, 1995 Annual Report
to Shareholders of U.S. Treasury Portfolio II, U.S. Treasury Portfolio and
U.S. Government Portfolio (each a series of the Trust), which are also
incorporated by reference into the Registration Statement. We further
consent to the references to us under the headings "Experts" and
"Financial Highlights" in such Proxy/Prospectus and to the references to
us under the headings "Financial Highlights" and "Auditor" in the combined
Prospectus and Statement of Additional Information for Class A shares of
the Trust dated May 20, 1994, which is also incorporated by reference into
the Proxy/Prospectus.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
Boston, Massachusetts
June 16, 1995
<PAGE>
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Rule 24f-2 Notice
Fidelity Institutional Cash Portfolios
FILE NO. 2-74808
Fidelity Institutional Cash Portfolios
: Money Market Portfolio
RULE 24F-2 - FILED PURSUANT TO RULE
24f-2(b)(1) OF THE INVESTMENT COMPANY ACT OF 1940
(i) Fiscal Year for Which Notice Filed
Fiscal year ended March 31, 1995
(ii) Number of Securities Which Remained Unsold at Beginning of Fiscal
Year
Registered Other Than Pursuant to Rule 24f-2
533,409,656 shares
(iii) Number of Securities Registered During Fiscal Year Other Than
Pursuant
to Rule 24f-2
1,102,149,339 shares
(iv) Number of Securities Sold During Fiscal Year
48,725,204,004 shares
For information relating to the calculation of the filing fee,
see Note (1) below.
(v) Number of Securities Sold During Fiscal Year Pursuant to Rule 24f-2
47,089,645,009 shares
<TABLE>
<CAPTION>
Number of Shares
Aggregate Price
<S>
<C>
<C>
Sales Pursuant to Rule 24f-2:
47,089,645,009
$
47,089,645,009
Redemptions:
(46,578,797,294)
$
(46,578,797,294)
Net Sales Pursuant to Rule 24f-2:
<PAGE>
510,847,715
$
510,847,715
</TABLE>
Note (1) : Pursuant to Rule 24f-2(c), the filing fee, calculated in the
manner specified in Section 6(b) of the Securities Act
of 1933, amounted to: $176,154.38
Fidelity Institutional Cash Portfolios
:
Money Market Portfolio
By John H. Costello
Assistant Treasurer
FILE NO. 2-74808
Fidelity Institutional Cash Portfolios
: Domestic Money Market Portfolio
RULE 24F-2 - FILED PURSUANT TO RULE
24f-2(b)(1) OF THE INVESTMENT COMPANY ACT OF 1940
(i) Fiscal Year for Which Notice Filed
Fiscal year ended March 31, 1995
(ii) Number of Securities Which Remained Unsold at Beginning of Fiscal
Year
Registered Other Than Pursuant to Rule 24f-2
No shares
(iii) Number of Securities Registered During Fiscal Year Other Than
Pursuant
to Rule 24f-2
153,614,466 shares
(iv) Number of Securities Sold During Fiscal Year
7,876,200,030 shares
For information relating to the calculation of the filing fee,
see Note (1) below.
(v) Number of Securities Sold During Fiscal Year Pursuant to Rule 24f-2
7,747,166,752 shares
<TABLE>
<CAPTION>
Number of Shares
Aggregate Price
<S>
<C>
<C>
<PAGE>
Sales Pursuant to Rule 24f-2:
7,747,166,752
$
7,747,166,752
Redemptions:
(7,747,166,752)
$
(7,747,166,752)
Net Sales Pursuant to Rule 24f-2:
0
$
0
</TABLE>
Note (1) : Pursuant to Rule 24f-2(c), the filing fee, calculated in the
manner specified in Section 6(b) of the Securities Act
of 1933, amounted to: $0
Fidelity Institutional Cash Portfolios
:
Domestic Money Market Portfolio
By John H. Costello
Assistant Treasurer
FILE NO. 2-74808
Fidelity Institutional Cash Portfolios
: U.S. Government Portfolio
RULE 24F-2 - FILED PURSUANT TO RULE
24f-2(b)(1) OF THE INVESTMENT COMPANY ACT OF 1940
(i) Fiscal Year for Which Notice Filed
Fiscal year ended March 31, 1995
(ii) Number of Securities Which Remained Unsold at Beginning of Fiscal
Year
Registered Other Than Pursuant to Rule 24f-2
No shares
(iii) Number of Securities Registered During Fiscal Year Other Than
Pursuant
to Rule 24f-2
1,975,720,984 shares
(iv) Number of Securities Sold During Fiscal Year
26,095,770,215 shares
For information relating to the calculation of the filing fee,
see Note (1) below.
<PAGE>
(v) Number of Securities Sold During Fiscal Year Pursuant to Rule 24f-2
26,095,770,215 shares
<TABLE>
<CAPTION>
Number of Shares
Aggregate Price
<S>
<C>
<C>
Sales Pursuant to Rule 24f-2:
26,095,770,215
$
26,095,770,215
Redemptions See Note (2) :
(26,095,770,215)
$
(26,095,770,215)
Note (2) : The total number of shares redeemed for the total dollar
amount of
redemptions for the fiscal period ended March 31, 1995
, aggregated
26,569,179,903
and $26,569,179,903
, respectively. An additional filing
pursuant to Rule 24e-2 can be made to register a number of shares
that will include the share redemptions not utilized under Rule 24f-2.
Net Sales Pursuant to Rule 24f-2:
0
$
0
</TABLE>
Note (1) : Pursuant to Rule 24f-2(c), the filing fee, calculated in the
manner specified in Section 6(b) of the Securities Act
of 1933, amounted to: $0
Fidelity Institutional Cash Portfolios
:
U.S. Government Portfolio
By John H. Costello
Assistant Treasurer
FILE NO. 2-74808
Fidelity Institutional Cash Portfolios
<PAGE>
: U.S. Treasury Portfolio
RULE 24F-2 - FILED PURSUANT TO RULE
24f-2(b)(1) OF THE INVESTMENT COMPANY ACT OF 1940
(i) Fiscal Year for Which Notice Filed
Fiscal year ended March 31, 1995
(ii) Number of Securities Which Remained Unsold at Beginning of Fiscal
Year
Registered Other Than Pursuant to Rule 24f-2
636,293,546 shares
(iii) Number of Securities Registered During Fiscal Year Other Than
Pursuant
to Rule 24f-2
454,595,986 shares
(iv) Number of Securities Sold During Fiscal Year
6,383,701,214 shares
For information relating to the calculation of the filing fee,
see Note (1) below.
(v) Number of Securities Sold During Fiscal Year Pursuant to Rule 24f-2
6,383,701,214 shares
<TABLE>
<CAPTION>
Number of Shares
Aggregate Price
<S>
<C>
<C>
Sales Pursuant to Rule 24f-2:
6,383,701,214
$
6,383,701,214
Redemptions See Note (2) :
(6,383,701,214)
$
(6,383,701,214)
Note (2) : The total number of shares redeemed for the total dollar
amount of
redemptions for the fiscal period ended March 31, 1995
, aggregated
6,832,522,666
and $6,832,522,666
, respectively. An additional filing
pursuant to Rule 24e-2 can be made to register a number of shares
that will include the share redemptions not utilized under Rule 24f-2.
<PAGE>
Net Sales Pursuant to Rule 24f-2:
0
$
0
</TABLE>
Note (1) : Pursuant to Rule 24f-2(c), the filing fee, calculated in the
manner specified in Section 6(b) of the Securities Act
of 1933, amounted to: $0
Fidelity Institutional Cash Portfolios
:
U.S. Treasury Portfolio
By John H. Costello
Assistant Treasurer
FILE NO. 2-74808
Fidelity Institutional Cash Portfolios
: U.S. Treasury Portfolio II
RULE 24F-2 - FILED PURSUANT TO RULE
24f-2(b)(1) OF THE INVESTMENT COMPANY ACT OF 1940
(i) Fiscal Year for Which Notice Filed
Fiscal year ended March 31, 1995
(ii) Number of Securities Which Remained Unsold at Beginning of Fiscal
Year
Registered Other Than Pursuant to Rule 24f-2
No shares
(iii) Number of Securities Registered During Fiscal Year Other Than
Pursuant
to Rule 24f-2
1,086,109,540 shares
(iv) Number of Securities Sold During Fiscal Year
55,751,134,827 shares
For information relating to the calculation of the filing fee,
see Note (1) below.
(v) Number of Securities Sold During Fiscal Year Pursuant to Rule 24f-2
55,102,464,175 shares
<TABLE>
<CAPTION>
Number of Shares
Aggregate Price
<S>
<PAGE>
<C>
<C>
Sales Pursuant to Rule 24f-2:
55,102,464,175
$
55,102,464,175
Redemptions:
(55,102,464,175)
$
(55,102,464,175)
Net Sales Pursuant to Rule 24f-2:
0
$
0
</TABLE>
Note (1) : Pursuant to Rule 24f-2(c), the filing fee, calculated in the
manner specified in Section 6(b) of the Securities Act
of 1933, amounted to: $0
Fidelity Institutional Cash Portfolios
:
U.S. Treasury Portfolio II
By John H. Costello
Assistant Treasurer
<PAGE>
Fidelity
Investments
Fidelity Management & Research Co.
82 Devonshire Street
Boston, MA 02109
617 570 7000
May 18, 1995
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, DC 20549
RE: Rule 24f-2 Notice
Fidelity Institutional Cash Portfolios
<PAGE>
File No. 2-74808
Gentlemen:
Pursuant to Rule 24f-2(b)(1) under the Investment Company Act of 1940,
enclosed herewith on behalf of the above fund is a Rule 24f-2 Notice for
the fiscal year ended March 31, 1995
. In accordance with Rule 24f-2(c), the
required filing fee of $176,154.38
was wired to Mellon Bank, in Pittsburgh,
Pennsylvania on May 18, 1995
.
Very truly yours,
Fidelity Institutional Cash Portfolios
By John H. Costello
Assistant Treasurer
Enclosures
<PAGE>
May 12, 1995
Arthur S. Loring, Esquire
General Counsel
Fidelity Management & Research Co.
82 Devonshire Street
Boston, Massachusetts 02109
Re:Fidelity Institutional Cash Portfolios
Dear Mr. Loring:
We have acted as special Delaware counsel to Fidelity Institutional
Cash Portfolios, a Delaware business trust (formerly named Fidelity
Institutional Cash Portfolios II, and prior to that Fidelity
Government Securities Fund) (the Trust ), in connection with
certain matters relating to the organization of the Trust and the
issuance of Shares therein. Capitalized terms used herein and not
otherwise herein defined are used as defined in the Trust Instrument
of the Trust dated June 20, 1991 (the Governing Instrument ).
In rendering this opinion, we have examined copies of the following
documents, each in the form provided to us: the Certificate of
Trust of the Trust dated as of June 20, 1991 (the Certificate ) and
filed in the Office of the Secretary of State of the State of Delaware
(the Recording Office ) on July 9, 1991, as amended by a
Certificate of Amendment dated May 28, 1993 as filed in the
Recording Office on May 28, 1993, and as further amended by a
Certificate of Amendment dated May 28, 1993 as filed in the
Recording Office on May 28, 1993; the Governing Instrument; the
Bylaws of the Trust; minutes of a meeting of the Board of Trustees
<PAGE>
of the Trust, dated June 20, 1991; a Certificate of Secretary of the
Trust, certifying as to the acceptance by certain persons of their
positions as trustees of the Trust; Post-Effective Amendment No.
20 to the Trust's Registration Statement on Form N-1A as filed
with the Commission on May 19, 1993 and a certification of good
standing of the Trust obtained as of a recent date from the
Recording Office. In such examinations, we have assumed the
genuineness of all signatures, the conformity to original documents
of all documents submitted to us as copies or drafts of documents
to be executed, and the legal capacity of natural persons to
complete the execution of documents. We have further assumed
for the purpose of this opinion: (i) the due authorization, execution
and delivery by, or on behalf of, each of the parties thereto of the
above-referenced instruments, certificates and other documents,
and of all documents contemplated by the Governing Instrument
and applicable resolutions of the Trustees to be executed by
investors desiring to become Shareholders; (ii) the payment of
consideration for Shares, and the application of such consideration
as provided in the Governing Instrument, and compliance with the
other terms, conditions and restrictions set forth in the Governing
Instrument and all applicable resolutions of the Trustees in
connection with the issuance of Shares (including, without
limitation, the taking of all appropriate action by the Trustees to
designate Series of Shares and the rights and preferences attribut-
able thereto as contemplated by the Governing Instrument); (iii)
that appropriate notation of the names and addresses of, the number
of Shares held by, and the consideration paid by, Shareholders will
be maintained in the appropriate registers and other books and
records of the Trust in connection with the issuance or transfer of
Shares; (iv) that no event has occurred subsequent to the filing of
the Certificate that would cause a termination or dissolution of the
Trust under Section 11.04 or Section 11.05 of the Governing
Instrument; (v) that the activities of the Trust have been and will be
conducted in accordance with the terms of the Governing
Instrument and the Delaware Act; and (vi) that each of the
documents examined by us is in full force and effect and has not
been modified, supplemented or otherwise amended. No opinion is
expressed herein with respect to the requirements of, or compliance
with, federal or state securities or blue sky laws. Further, we have
not reviewed and express no opinion on the sufficiency or accuracy
of any registration or offering documentation relating to the Trust
or the Shares. As to any facts material to our opinion, other than
those assumed, we have relied without independent investigation on
the above-referenced documents and on the accuracy, as of the date
hereof, of the matters therein contained.
Based on and subject to the foregoing, and limited in all respects to
matters of Delaware law, it is our opinion that:
1.The Trust is a duly organized and validly existing business trust in
good standing under the laws of the State of Delaware.
2.The Shares, when issued to Shareholders in accordance with the
terms, conditions, requirements and procedures set forth in the
Governing Instrument, will constitute legally issued, fully paid and
non-assessable Shares of beneficial interest in the Trust.
<PAGE>
3.Under the Delaware Act and the terms of the Governing
Instrument, each Shareholder of the Trust, in such capacity, will be
entitled to the same limitation of personal liability as that extended
to stockholders of private corporations for profit; provided,
however, that we express no opinion with respect to the liability of
any Shareholder who is, was or may become a named Trustee of
the Trust. Neither the existence nor exercise of the voting rights
granted to Shareholders under the Governing Instrument will, of
itself, cause a Shareholder to be deemed a trustee of the Trust
under the Delaware Act.
We understand that you wish to rely as to matters of Delaware law
on the opinion set forth above in connection with the rendering by
you of an opinion to be used as an Exhibit to a Rule 24f-2 filing to
be made by the Trust with the Commission, and we hereby consent
to such reliance. Except as provided in the foregoing sentence, the
opinion set forth above is expressed solely for the benefit of the
addressee hereof and may not be relied upon by any other person or
entity for any purpose without our prior written consent.
Sincerely,
MORRIS, NICHOLS, ARSHT & TUNNELL
<PAGE>
May 18, 1995
Mr. John Costello, Assistant Treasurer
Fidelity Institutional Cash Portfolios
82 Devonshire Street
Boston, Massachusetts 02109
Dear Mr. Costello:
Fidelity Institutional Cash Portfolios is a Delaware business trust
created under a written Trust Instrument dated June 20, 1991.
I am of the opinion that all legal requirements have been complied
with in the creation of the Trust and that said Trust is a duly
authorized and validly existing business trust under the laws of the
State of Delaware. In this regard, I have relied on the opinion of
Delaware counsel, Morris, Nichols, Arsht & Tunnell, contained in a
letter dated May 12, 1995, with respect to matters of Delaware law.
I have conducted such legal and factual inquiry as I have deemed
necessary for the purpose of rendering this opinion.
Capitalized terms used herein, and not otherwise herein defined, are
used as defined in the Trust Instrument.
Under Article II, Section 2.01, of the Trust Instrument, the
beneficial interest in the Trust shall be divided into such transferable
Shares of one or more separate and distinct Series or classes of a
Series as the Trustees shall from time to time create and establish.
The number of Shares of each Series, and class thereof, authorized
<PAGE>
thereunder is unlimited and each Share shall be without par value
and shall be fully paid and nonassessable.
Under Article II, Section 2.06, the Trust shall consist of one or
more Series and the Trustees of each Series shall have full power
and authority, in their sole discretion, and without obtaining any
prior authorization or vote of the Shareholders of any Series of the
Trust to establish and designate (and to change in any manner) any
such Series of Shares with such preferences, voting powers, rights
and privileges as the Trustees may from time to time determine, to
divide or combine the Shares into a greater or lesser number, to
classify or reclassify any issued Shares of any Series, and to take
such other action with respect to the Shares as the Trustees may
deem desirable.
Under Article II, Section 2.07, the Trustees are empowered to
accept investments in the Trust in cash or securities from such
persons and on such terms as they may from time to time authorize.
Such investments in the Trust shall be credited to each
Shareholder's account in the form of full Shares at the Net Asset
Value per Share next determined after the investment is received;
provided, however, that the Trustees may, in their sole discretion,
fix the initial Net Asset Value per Share of the initial capital
contribution, impose a sales charge upon investments in the Trust in
such manner and at such time as determined by the Trustees, or
issue fractional shares.
By a vote adopted on June 12, 1991, the Board of Trustees
authorized the issue and sale, from time to time, of an unlimited
number of shares of beneficial interest of this Fund in accordance
with the terms included in the then current Registration Statement
and subject to the limitations of the Trust Instrument and any
amendments thereto.
I understand from you that, pursuant to Rule 24f-2 under the
Investment Company Act of 1940, the Trust has registered an
indefinite amount of shares of beneficial interest under the
Securities Act of 1933. I further understand that, pursuant to the
provisions of Rule 24f-2, the Trust intends to file with the
Securities and Exchange Commission a Notice making definite the
registration of 142,418,747,365 shares of the Trust (the Shares )
sold in reliance upon Rule 24f-2 during the fiscal year ended March
31, 1995.
I am of the opinion that all necessary Trust action precedent to the
issue of Shares has been duly taken, and that all the Shares were
legally and validly issued, and are fully paid and nonassessable
under Delaware law, subject to the possibility that a court might not
apply such law as described in the Funds' Statement of Additional
Information under the heading Shareholder and Trustee Liability.
In rendering this opinion, I rely on the representation by the Trust
that it or its agent received consideration for the Shares in
accordance with the Trust Instrument and I express no opinion as
to compliance with the Securities Act of 1933, the Investment
<PAGE>
Company Act of 1940, or applicable state Blue Sky or securities
laws in connection with sales of the Shares.
I hereby consent to the filing of this opinion with the Securities and
Exchange Commission in connection with a Rule 24f-2 Notice
which you are about to file under the 1940 Act with said
Commission.
Very truly yours,
/s/Arthur S. Loring
Vice President - Legal
<PAGE>
