<PAGE>
Please read this prospectus before investing, and keep it on file for
future reference. It contains important information, including how each
fund invests and the services available to shareholders.
FIDELITY INSTITUTIONAL
MONEY MARKET
FUNDS - CLASS A
To learn more about each fund and its investments, you can obtain a copy of
the applicable fund's most recent financial report and portfolio listing or
a copy of the Statement of Additional Information (SAI) dated July 1, 1995.
The SAI has been filed with the Securities and Exchange Commission (SEC)
and is incorporated herein by reference (legally forms a part of the
prospectus). For a free copy of either document, call your Financial
Institution, or call Fidelity Client Services at 1-800-843-3001.
INVESTMENTS IN THE FUNDS ARE NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT, AND THERE CAN BE NO ASSURANCE THAT A FUND 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.
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.
IMM-pro-795
FIDELITY INSTITUTIONAL CASH PORTFOLIOS (FICP):
Treasury
Treasury II
Government
Domestic
Money Market
DAILY MONEY FUND (DMF):
Treasury Only
FIDELITY INSTITUTIONAL TAX-EXEMPT CASH PORTFOLIOS (FITECP):
Tax-Exempt
PROSPECTUS
JULY 1, 1995(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON, MA 02109
CONTENTS
KEY FACTS WHO MAY WANT TO INVEST
EXPENSES Class A's yearly operating expenses.
FINANCIAL HIGHLIGHTS A summary of each fund's
financial data.
PERFORMANCE
THE FUNDS IN DETAIL CHARTER How each fund is organized.
INVESTMENT PRINCIPLES AND RISKS Each fund's
overall approach to investing.
BREAKDOWN OF EXPENSES How operating costs
are calculated and what they include.
YOUR ACCOUNT HOW TO BUY SHARES Opening an account and
making additional investments.
HOW TO SELL SHARES Taking money out and closing
your account.
INVESTOR SERVICES Services to help you manage
your account.
SHAREHOLDER AND DIVIDENDS, CAPITAL GAINS, AND TAXES
ACCOUNT POLICIES
TRANSACTION DETAILS Share price calculations and
the timing of purchases and redemptions.
EXCHANGE RESTRICTIONS
KEY FACTS
WHO MAY WANT TO INVEST
Each fund offers institutional and corporate investors a convenient and
economical way to invest in a professionally managed portfolio of money
market instruments.
Each fund is designed for those investors who would like to earn current
income while preserving the value of their investment.
The rate of income will vary from day to day, generally reflecting
short-term interest rates.
Each fund is managed to keep its share price stable at $1.00. Treasury,
Treasury II, Government, and Treasury Only each offer an added measure of
safety with their focus on U.S. Government securities.
None of the funds constitutes a balanced investment plan. However, because
they emphasize stability, they could be well-suited for a portion of your
investment .
Each fund is composed of multiple classes of shares. Each class of a
fund has a common investment objective and investment portfolio. Class A
shares do not have a sales charge and do not pay a distribution fee. Class
B shares do not have a sales charge, but do pay a distribution fee. Because
Class A shares have no sales charge and do not pay a distribution fee,
Class A shares are expected to have a higher total return than Class B
shares. You may obtain more information about Class B shares, which are not
offered through this prospectus, from your Financial Institution, or by
calling Fidelity Client Services 1-800-843-3001. Contact your Financial
Institution to discuss which class is appropriate for you.
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you pay when you buy or sell
Class A shares of a fund.
Maximum sales charge on purchases and None
reinvested distributions
Maximum deferred sales charge None
Redemption fee None
Exchange fee None
ANNUAL OPERATING EXPENSES are paid out of each fund's Class A
assets. Each fund pays a management fee to Fidelity Management &
Research Company (FMR). Each fund also incurs other expenses for services
such as maintaining shareholder records and furnishing shareholder
statements and financial reports.
Class A 's expenses are factored into its share price or dividends
and are not charged directly to shareholder accounts (see "Breakdown of
Expenses" on page ).
The following are projections based on historical expenses of Class A of
each fund , and are calculated as a percentage of average net assets
of Class A of each fund.
Class A Operating Expenses
TREASURY Management fee .16%
A
12b-1 fee (Distribution fee) None
Other expenses .04
%
Total operating expenses .20%
A
TREASURY II Management fee .15%
A
12b-1 fee (Distribution fee) None
Other expenses .05
%
Total operating expenses .20%
A
GOVERNMENT Management fee .16%
A
12b-1 fee (Distribution fee) None
Other expenses .04
%
Total operating expenses .20%
A
A AFTER EXPENSE REDUCTIONS.
<TABLE>
<CAPTION>
<S> <C> <C>
Class A Operating Expenses
DOMESTIC Management fee .13%
A
12b-1 fee (Distribution fee) None
Other expenses .07
%
Total operating expenses .20%
A
MONEY MARKET Management fee .14%
A
12b-1 fee (Distribution fee) None
Other expenses .04
%
Total operating expenses .18%
A
TREASURY ONLY Management fee .20 %
A
12b-1 fee (Distribution fee) None
Other expenses None
Total operating expenses .20%
A
TAX-EXEMPT Management fee .14 %
A
12b-1 fee (Distribution fee) None
Other expenses .06
%
Total operating expenses .20%
A
</TABLE>
A AFTER EXPENSE REDUCTIONS.
EXPENSE TABLE EXAMPLE: You would pay the following expenses on a $1,000
investment in Class A shares, assuming a 5% annual return and full
redemption at the end of each time period:
1 3 5 10
Year Years Year Years
Treasury $ 2 $ 6 $ 11 $ 26
Treasury II $ 2 $ 6 $ 11 $ 26
Government $ 2 $ 6 $ 11 $ 26
Domestic $ 2 $ 6 $ 11 $ 26
Money Market $ 2 $ 6 $ 10 $ 23
Treasury Only $ 2 $ 6 $ 11 $ 26
Tax-Exempt $ 2 $ 6 $ 11 $ 26
THESE EXAMPLES ILLUSTRATE THE EFFECT OF EXPENSES, BUT ARE NOT MEANT TO
SUGGEST ACTUAL OR EXPECTED COSTS OR RETURNS, ALL OF WHICH MAY VARY.
FMR has voluntarily agreed to reimburse Class A of each fund to the extent
that total operating expenses (excluding taxes, brokerage commissions, and
extraordinary expenses) are in excess of .20% (.18% for Money Market) of
its average net assets. If this agreement were not in effect, management
fees and total operating expenses for Class A of each fund would have been
the following amounts, as a percentage of average net assets: .20% and .24%
for Treasury; .20% and .25% for Treasury II; .20% and .24% for Government;
.20% and .27% for Domestic; .20% and .24% for Money Market; .42% and .42%
for Treasury Only; and .20% and .26% for Tax-Exempt.
FINANCIAL HIGHLIGHTS
The financial highlights tables that follow and each fund's financial
statements are included in each fund's Annual Report and have been audited
by independent accountants. Price Waterhouse LLP serve s as
independent accountant s for each of the FICP funds, while Coopers
& Lybrand L.L.P. serve s as independent accountant s for
both Tax-Exempt and Treasury Only. Their reports , as applicable, on
the financial statements and financial highlights are included in
the Annual Report s . The financial statements, the financial
highlights, and the reports are incorporated by reference into the funds'
SAI, which may be obtained free of charge from Fidelity Distributors
Corporation ( FDC ) .
FICP: TREASURY - CLASS AD
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1.Select
ed
Per-Sha
re Data
2.Years
1986A 1987 1988 1989 1990 1991 1992 1993 1994 1995
ended
March
31
3.Net
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
beginnin
g of
period
4.Incom
.030 .062 .065 .079 .088 .076 .053 .035 .030 .047
e from
Investm
ent
Operati
ons
Net
interest
income
5.Less
(.030) (.062) (.065) (.079) (.088) (.076) (.053) (.035) (.030) (.047)
Distribut
ions
From
net
interest
income
6.Net
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
end of
period
7.Total
3.02% 6.36 6.65 8.17 9.15 7.89 5.48 3.51 3.08 4.79
returnB % % % % % % % % %
8.RATIOS AND
SUPPLEMENTAL
DATA
9.Net
$ 239,945 $ 637,115 $ 650,114 $ 1,179,6 $ 1,721,1 $ 1,782,9 $ 2,629,0 $ 2,036,8 $ 1,611,8 $ 1,197,7
assets, 20 26 57 72 06 77 21
end of
period
(000
omitted)
10.Rati
.20%C .20 .20 .20 .20 .18 .18 .18 .18 .18
o of % % % % % % % % %
expense
s to
average
net
assets
11.Rati
.34%C .25 .23 .26 .25 .24 .25 .23 .23 .24
o of % % % % % % % % %
expense
s to
average
net
assets
before
expense
reductio
ns
12.Rati
7.56%C 6.13 6.45 8.06 8.72 7.57 5.29 3.46 3.03 4.63
o of net % % % % % % % % %
interest
income
to
average
net
assets
</TABLE>
A NOVEMBER 9, 1985 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1986
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.
C ANNUALIZED
D AS OF MARCH 31, 1995 CLASS B FOR TREASURY HAD NOT COMMENCED OPERATIONS.
FICP: TREASURY II - CLASS A
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
13.Sele
cted
Per-Sha
re Data
14.Year 1987A 1988 1989 1990 1991 1992 1993 1994 1995
s ended
March
31
15.Net $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
beginnin
g of
period
16.Inco
me from
Investm
ent
Operati
ons
17. Ne .009 .064 .078 .088 .076 .053 .034 .030 .047
t
interest
income
18.Less
Distribut
ions
19. Fr (.009) (.064) (.078) (.088) (.076) (.053) (.034) (.030) (.047)
om net
interest
income
20.Net $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
end of
period
21.Total .93% 6.60 8.11 9.13 7.87 5.41 3.46 3.06 4.78
return B % % % % % % % %
22.RATIOS AND
SUPPLEMENTAL
DATA
23.Net $ 26,314 $ 379,50 $ 658,06 $ 1,481,3 $ 3,281,6 $ 5,476,8 $ 5,589,6 $ 4,551,9 $ 4,688,1
assets, 1 8 24 86 52 63 18 98
end of
period
(000
omitted)
24.Rati .20% .20 .20 .19 .18 .18 .18 .18 .18
o of C % % % % % % % %
expense
s to
average
net
assets
25.Rati .99% .32 .26 .27 .25 .25 .23 .24 .25
o of C % % % % % % % %
expense
s to
average
net
assets
before
expense
reductio
ns
26.Rati 6.11% 6.46 7.92 8.63 7.50 5.12 3.38 3.01 4.71
o of net C % % % % % % % %
interest
income
to
average
net
assets
</TABLE>
A FEBRUARY 2, 1987 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1987
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.
C ANNUALIZED
FICP: TREASURY II - CLASS B
27.Sele
cted
Per-Sha
re Data
28.Year 1994A 1995
s ended
March
31
29.Net $ 1.000 $ 1.000
asset
value,
beginnin
g of
period
30.Inco
me from
Investm
ent
Operati
ons
31. Ne .012 .044
t
interest
income
32.Less
Distribut
ions
33. Fr (.012) (.044)
om net
interest
income
34.Net $ 1.000 $ 1.000
asset
value,
end of
period
35.Total 1.21% 4.45
return B %
36.RATI
OS AND
SUPPLE
MENTAL
DATA
37.Net $ 5,175 $ 585,57
assets, 1
end of
period
(000
omitted)
38.Rati .50% .50
o of C %
expense
s to
average
net
assets
39.Rati .56% .81
o of C %
expense
s to
average
net
assets
before
expense
reductio
ns
40.Rati 2.69% 4.91
o of net C %
interest
income
to
average
net
assets
A OCTOBER 22, 1993 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1994
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.
C ANNUALIZED
FICP: GOVERNMENT - CLASS A
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
41.Sele
cted
Per-Sha
re Data
42.Year
1986 A 1987 1988 1989 1990 1991 1992 1993 1994 1995
s ended
March
31
43.Net
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
beginnin
g of
period
44.Inco
me from
Investm
ent
Operati
ons
45. Ne
.053 .063 .068 .079 .088 .077 .054 .035 .031 .048
t
interest
income
46.Less
Distribut
ions
47. Fr
(.053) (.063) (.068) (.079) (.088) (.077) (.054) (.035) (.031) (.048)
om net
interest
income
48.Net
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
end of
period
49.Total
5.47% 6.51 6.98 8.19 9.15 7.94 5.55 3.56 3.13 4.86
return B % % % % % % % % %
50.RATIOS AND
SUPPLEMENTAL
DATA
51.Net
$ 511,720 $ 1,358,6 $ 1,878,7 $ 1,918,3 $ 2,815,6 $ 3,613,8 $ 4,603,7 $ 5,686,1 $ 3,764,5 $ 3,321,0
assets, 59 86 42 22 38 81 66 44 66
end of
period
(000
omitted)
52.Rati
.20% .20 .20 .20 .20 .18 .18 .18 .18 .18
o of
C % % % % % % % % %
expense
s to
average
net
assets
53.Rati
.30% .25 .23 .24 .25 .25 .25 .24 .24 .24
o of
C % % % % % % % % %
expense
s to
average
net
assets
before
expense
reductio
ns
54.Rati
7.81% 6.28 6.78 7.90 8.74 7.62 5.33 3.50 3.07 4.77
o of net
C % % % % % % % % %
interest
income
to
average
net
assets
</TABLE>
A JULY 25, 1985 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1986
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.
C ANNUALIZED
FICP: GOVERNMENT - CLASS B
55.Sele
cted
Per-Sha
re Data
56.Year 1995 A
ended
March
31
57.Net $ 1.000
asset
value,
beginnin
g of
period
58.Inco
me from
Investm
ent
Operati
ons
59. Ne .045
t
interest
income
60.Less
Distribut
ions
61. Fr (.045)
om net
interest
income
62.Net $ 1.000
asset
value,
end of
period
63.Total 4.57%
return B
64.RATI
OS AND
SUPPLE
MENTAL
DATA
65.Net $ 40,516
assets,
end of
period
(000
omitted)
66.Rati .43%
o of C
expense
s to
average
net
assets
67.Rati .66%
o of C
expense
s to
average
net
assets
before
expense
reductio
ns
68.Rati 5.13%
o of net C
interest
income
to
average
net
assets
A APRIL 4, 1994 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1995
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.
C ANNUALIZED
FICP: DOMESTIC - CLASS A
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
69.Sele
cted
Per-Sha
re Data
70.Year 1990A 1991 1992 1993 1994 1995
s ended
March
31
71.Net $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
beginnin
g of
period
72.Inco
me from
Investm
ent
Operati
ons
73. Ne .035 .078 .054 .034 .031 .049
t
interest
income
74.Less
Distribut
ions
75. Fr (.035) (.078) (.054) (.034) (.031) (.049)
om net
interest
income
76.Net $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
end of
period
77.Total 3.52% 8.11 5.50 3.50 3.14 4.97
return B % % % % %
78.RATI
OS AND
SUPPLE
MENTAL
DATA
79.Net $ 330,974 $ 355,36 $ 558,72 $ 804,35 $ 656,97 $ 771,93
assets, 9 7 4 6 7
end of
period
(000
omitted)
80.Rati .06% .18 .18 .18 .18 .18
o of C % % % % %
expense
s to
average
net
assets
81.Rati .43% .30 .29 .26 .26 .27
o of C % % % % %
expense
s to
average
net
assets
before
expense
reductio
ns
82.Rati 8.44% 7.79 5.24 3.43 3.09 4.94
o of net C % % % % %
interest
income
to
average
net
assets
</TABLE>
A NOVEMBER 3, 1989 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1990
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.
C ANNUALIZED
FICP: DOMESTIC - CLASS B
83.Sele
cted
Per-Sha
re Data
84.Year 1995A
ended
March
31
85.Net $ 1.000
asset
value,
beginnin
g of
period
86.Inco
me from
Investm
ent
Operati
ons
87. Ne .035
t
interest
income
88.Less
Distribut
ions
89. Fr (.035)
om net
interest
income
90.Net $ 1.000
asset
value,
end of
period
91.Total 3.51%
return B
92.RATI
OS AND
SUPPLE
MENTAL
DATA
93.Net $ 26,545
assets,
end of
period
(000
omitted)
94.Rati .50%
o of C
expense
s to
average
net
assets
95.Rati .79%
o of C
expense
s to
average
net
assets
before
expense
reductio
ns
96.Rati 5.14%
o of net C
interest
income
to
average
net
assets
A JULY 19, 1994 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1995
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.
C ANNUALIZED
FICP: MONEY MARKET - CLASS A
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
97.Sele
cted
Per-Sha
re Data
98.Year
1986A 1987 1988 1989 1990 1991 1992 1993 1994 1995
s ended
March
31
99.Net
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
beginnin
g of
period
100.Inc
ome
from
Investm
ent
Operati
ons
101. Ne
.059 .064 .069 .080 .089 .078 .055 .035 .032 .049
t
interest
income
102.Le
ss
Distribut
ions
103. Fr
(.059) (.064) (.069) (.080) (.089) (.078) (.055) (.035) (.032) (.049)
om net
interest
income
104.Net
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
end of
period
105.Tot
6.01% 6.57 7.14 8.35 9.25 8.13 5.59 3.58 3.20 4.99
al return% % % % % % % % %
B
106.RATIOS AND
SUPPLEMENTAL
DATA
107.Net
$ 960,784 $ 1,569,1 $ 2,524,7 $ 2,627,4 $ 4,127,8 $ 4,706,9 $ 3,990,3 $ 4,332,9 $ 3,200,2 $ 5,130,1
assets, 99 67 50 79 36 95 95 77 23
end of
period
(000
omitted)
108.Rat
.19% .20 .20 .20 .20 .18 .18 .18 .18 .18
io of
C % % % % % % % % %
expense
s to
average
net
assets
109.Rat
.28% .23 .23 .24 .24 .25 .24 .23 .23 .24
io of
C % % % % % % % % %
expense
s to
average
net
assets
before
expense
reductio
ns
110.Rat
7.97% 6.33 6.95 8.11 8.82 7.80 5.42 3.50 3.15 5.00
io of net
C % % % % % % % % %
interest
income
to
average
net
assets
</TABLE>
A JULY 5, 1985 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1986
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.
C ANNUALIZED
FICP: MONEY MARKET - CLASS B
111.Sel
ected
Per-Sha
re Data
112.Ye 1994A 1995
ars
ended
March
31
113.Net $ 1.000 $ 1.000
asset
value,
beginnin
g of
period
114.Inc
ome
from
Investm
ent
Operati
ons
115. Ne .011 .046
t
interest
income
116.Les
s
Distribut
ions
117. Fr (.011) (.046)
om net
interest
income
118.Net $ 1.000 $ 1.000
asset
value,
end of
period
119.Tot 1.07% 4.66%
al return
B
120.RA
TIOS
AND
SUPPLE
MENTAL
DATA
121.Net $ 89,463 $ 457,286
assets,
end of
period
(000
omitted)
122.Rat .50% .50%
io of C
expense
s to
average
net
assets
123.Rat .55% .59%
io of C
expense
s to
average
net
assets
before
expense
reductio
ns
124.Rat 2.83% 4.94%
io of net C
interest
income
to
average
net
assets
A NOVEMBER 17,1993 (COMMENCEMENT OF OPERATIONS) TO MARCH 31, 1994
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.
C ANNUALIZED
TREASURY ONLY - CLASS A
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
125.Sel
ected
Per-Sha
re Data
126.Ye 1991A 1992 1993 1994 1995D
ars
ended
July 31
127.Net $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
beginnin
g of
period
128.Inc .055 .045 .031 .032 .033
ome
from
Investm
ent
Operati
ons
Net
interest
income
129.Le (.055) (.045) (.031) (.032) (.033)
ss
Distribut
ions
From
net
interest
income
130.Net $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
end of
period
131.Tot 5.63% 4.64% 3.10% 3.27% 3.38%
al
returnB
132.RA
TIOS
AND
SUPPLE
MENTAL
DATA
133.Net $ 705,543 $ 1,197,559 $ 1,047,791 $ 1,049,170 $ 1,266,285
assets,
end of
period
(000
omitted)
134.Rat .03% .20% .20% .20% .20%
io of C C
expense
s to
average
net
assets
135.Rat .42% .42% .42% .42% .42%
io of C C
expense
s to
average
net
assets
before
expense
reductio
ns
136.Rat 6.34% 4.43% 3.05% 3.22% 5.02%
io of net C C
interest
income
to
average
net
assets
</TABLE>
A OCTOBER 3, 1990 (COMMENCEMENT OF OPERATIONS) TO JULY 31, 1991
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES BEEN REDUCED
DURING THE PERIODS SHOWN.
C ANNUALIZED
D AUGUST 1, 1994 TO MARCH 31, 1995
TAX-EXEMPT - CLASS A
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
137.Sel
ected
Per-Sha
re Data
138.Ye
1986A 1987 1988 1989 1990 1991 1992 1993 1994 1995D
ars
ended
May 31
139.Net
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
beginnin
g of
period
140.Inc
.044 .042 .046 .058 .058 .053 .040 .026 .024 .027
ome
from
Investm
ent
Operati
ons
Net
interest
income
141.Le
(.044) (.042) (.046) (.058) (.058) (.053) (.040) (.026) (.024) (.027)
ss
Distribut
ions
From
net
interest
income
142.Net
$ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
asset
value,
end of
period
143.Tot
4.51% 4.28 4.72 5.97 6.00 5.40 4.02 2.66 2.44 2.74%
al % % % % % % % %
returnB
144.RATIOS AND
SUPPLEMENTAL DATA
145.Net
$ 1,162,9 $ 1,850,0 $ 2,080,8 $ 2,006,8 $ 1,984,6 $ 2,116,8 $ 2,556,9 $ 2,239,0 $ 2,390,6 $ 1,876,815
assets,
39 53 46 67 36 41 95 31 63
end of
period
(000
omitted)
146.Rat
.19% .20 .20 .20 .20 .18 .18 .18 .18 .18%C
io of
C % % % % % % % %
expense
s to
average
net
assets
147.Rat
.25% .23 .22 .24 .23 .23 .25 .24 .24 .26%C
io of
C % % % % % % % %
expense
s to
average
net
assets
before
expense
reductio
ns
148.Rat
5.18% 4.20 4.65 5.80 5.82 5.28 3.90 2.62 2.41 3.20%C
io of net
C % % % % % % % %
interest
income
to
average
net
assets
</TABLE>
A JULY 25, 1985 (COMMENCEMENT OF OPERATIONS) TO MAY 31, 1986
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.
C ANNUALIZED
D JUNE 1, 1994 TO MARCH 31, 1995
PERFORMANCE
Money market fund performance can be measured as TOTAL RETURN or YIELD.
EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment in a fund over
a given period, assuming reinvestment of any dividends and capital gains. A
CUMULATIVE TOTAL RETURN reflects actual performance over a stated period of
time. An AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate of return that,
if achieved annually, would have produced the same cumulative total return
if performance had been constant over the entire period. Average annual
total returns smooth out variations in performance; they are not the same
as actual year-by-year results.
Average annual total returns covering periods of less than one year
assume that performance will remain constant for the rest of the year.
YIELD refers to the income generated by an investment in a fund over a
given period of time, expressed as an annual percentage rate.
When a yield assumes that income earned is reinvested, it is called an
EFFECTIVE YIELD.
A TAX-EQUIVALENT YIELD shows what an investor would have to earn before
taxes to equal a tax-free yield.
SEVEN-DAY YIELD illustrates the income earned by an investment in a
money market fund over a recent seven-day period. Since money market funds
maintain a stable $1.00 share price, current seven-day yields are the most
common illustration of money market fund performance.
The funds' recent strategies, performance, and holdings are detailed twice
a year in financial reports, which are sent to all shareholders.
For current performance call Fidelity Client Services at
1-800-843-3001 .
THE FUNDS IN DETAIL
CHARTER
EACH FUND IS A MUTUAL FUND: an investment that pools shareholders' money
and invests it toward a specified goal. Treasury, Treasury II,
Government, Domestic, and Money Market are diversified
funds of Fidelity Institutional Cash Portfolios, an open-end
management investment company organized as a Delaware business trust on May
30, 1993. Treasury Only is a diversified fund of Daily Money Fund,
an open-end management investment company organized as a Delaware business
trust on September 30, 1993. Tax-Exempt is a diversified fund of
Fidelity Institutional Tax-Exempt Cash Portfolios, an open-end management
investment company organized as a Delaware business trust on January 29,
1992. There is a remote possibility that one fund might become
liable for a misstatement in the prospectus about another fund.
EACH FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet throughout the year to oversee the funds' activities,
review contractual arrangements with companies that provide services to the
funds, and review the funds' performance. The majority of trustees are not
otherwise affiliated with Fidelity.
THE FUNDS MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These
meetings may be called to elect or remove trustees, change fundamental
policies, approve a management contract, or for other purposes.
Shareholders not attending these meetings are encouraged to vote by proxy.
The transfer agent will mail proxy materials in advance, including a voting
card and information about the proposals to be voted on. You are entitled
to one vote for each share you own.
Separate votes are taken by each class of shares, fund, or trust, if a
matter affects just that class of shares, fund, or trust, respectively.
The Board of Trustees of Fidelity Institutional Cash Portfolios has
unanimously approved an Agreement and Plan of Reorganization between
Treasury and Treasury II (Agreement and Plan). The Agreement and Plan will
be presented to Treasury shareholders for their vote of approval or
disapproval at a Special Meeting to be held on September 13, 1995. If the
proposal is approved by a majority of Treasury shareholders on or about
November 1, 1995, all of the assets of Treasury will be merged into
Treasury II. Effective on or about July 17, 1995, you will be unable to
open a new account in Class A shares of Treasury.
FMR AND ITS AFFILIATES
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, Massachusetts 02109. It includes a number
of different subsidiaries and divisions which provide a variety of
financial services and products. The funds employ various Fidelity
companies to perform activities required for their operation.
The funds are managed by FMR, which handles their business affairs.
FMR Texas , Inc. (FMR Texas), located in Irving, Texas, has
primary responsibility for providing investment management services.
As of April 30 , 1995, FMR advised funds having approximately
20 million shareholder accounts with a total value of more than
$ 285 billion.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
FDC distributes and markets Fidelity's funds and services. Fidelity
Investments Institutional Operations Company (FIIOC) performs
certain transfer agent servicing functions for Class A shares of
the funds.
FMR Corp. is the ultimate parent company of FMR and FMR Texas. Through
ownership of voting common stock, members of the Edward C. Johnson 3d
family form a controlling group with respect to FMR Corp. Changes may occur
in the Johnson family group, through death or disability, which would
result in changes in each individual family member's holding of stock. Such
changes could result in one or more family members becoming holders of over
25% of the stock. FMR Corp. has received an opinion of counsel that changes
in the composition of the Johnson family group under these circumstances
would not result in the termination of the funds' management or
distribution contracts and, accordingly, would not require a shareholder
vote to continue operation under those contracts.
UMB Bank, n.a. (UMB) is Tax-Exempt's transfer agent, although it employs
FIIOC to perform these functions. UMB is located at 1010 Grand Avenue,
Kansas City, Missouri.
To carry out the funds' transactions, FMR may use its broker-dealer
affiliates and other firms that sell fund shares, provided that a fund
receives services and commission rates comparable to those of other
broker-dealers.
INVESTMENT PRINCIPLES AND RISKS
TREASURY ONLY seeks as high a level of current income as is consistent
with the security of principal and liquidity, and to maintain a constant
net asset value per share (NAV) of $1.00.
The fund invests only in U.S. Treasury securities, including bills, notes,
bonds and other direct obligations of the U.S. Treasury that are guaranteed
as to payment of principal and interest by the full faith and credit of the
U.S. Government.
The fund will invest in those securities whose interest is specifically
exempt from state and local income taxes under federal law; such interest
is not exempt from federal income tax.
TREASURY seeks 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 fund.
Under normal conditions, the fund invests 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.
TREASURY II seeks 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 fund.
Under normal conditions, the fund invests 100% of its total assets in U.S.
Treasury bills, notes and bonds and other direct obligations of the U.S.
Treasury. The fund may also engage in repurchase agreements backed by those
obligations.
GOVERNMENT seeks 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 fund.
The fund 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.
DOMESTIC seeks 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 fund.
The fund 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 fund may purchase unrated obligations
determined to be of equivalent quality pursuant to procedures adopted by
the Board of Trustees. Under normal conditions, the fund will invest more
than 25% of its total assets in obligations of companies in the financial
services industry.
MONEY MARKET seeks 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 fund.
The fund invests in high-quality, U.S. dollar-denominated money market
instruments of domestic and foreign 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 fund may purchase
unrated obligations determined to be of equivalent quality pursuant to
procedures adopted by the Board of Trustees. Under normal conditions, the
fund will invest more than 25% of its total assets in obligations of
companies in the financial services industry.
TAX-EXEMPT seeks as high a level of interest income exempt from federal
income tax as is consistent with a portfolio of high - quality,
short-term municipal obligations selected on the basis of liquidity and
stability of principal.
The fund invests primarily in high - quality, short-term municipal
securities, but also may invest in high - quality, long-term fixed,
variable, or floating rate instruments (including tender option bonds)
whose features give them interest rates, maturities, and prices similar to
short-term instruments. Securities in which the fund invests
must be rated, in accordance with applicable rules, in the highest
rating category for short-term securities by at least one nationally
recognized statistical rating organization (NRSRO) and rated in one of the
two highest categories for short-term securities by another NRSRO if rated
by more than one NRSRO; or, if unrated, judged by FMR to be equivalent
quality to those securities rated in the highest short-term rating
category, pursuant to procedures adopted by the Board of Trustees. The
fund's policy regarding limiting investments to the highest rating category
may be changed upon 90 days' prior notice to shareholders.
The fund, under normal conditions, will invest so that at least 80% of
its income distributions is exempt from federal income tax. The fund does
not currently intend to purchase municipal obligations that are subject to
the federal alternative minimum tax.
FMR normally invests the fund's assets according to its investment strategy
and does not expect to invest in federally taxable obligations. The fund
also reserves the right to hold a substantial amount of uninvested cash or
to invest more than normally permitted in federally taxable obligations for
temporary, defensive purposes.
COMMON POLICIES
The funds follow industry-standard guidelines on the quality and maturity
of their investments, which are designed to help maintain a stable $1.00
share price. The funds will purchase only high-quality securities that FMR
believes present minimal credit risks and will observe maturity
restrictions on securities they buy. In general, securities with longer
maturities are more vulnerable to price changes, although they may provide
higher yields. It is possible that a major change in interest rates or a
default on the funds' investments could cause their share prices (and the
value of your investment) to change. It is important to note that the funds
are not guaranteed by the U.S. Government.
Each fund stresses income (tax-free income in the case of Tax-Exempt),
preservation of capital, and liquidity, and does not seek the higher yields
or capital appreciation tha t more aggressive investments may
provide. Each fund's yield will vary from day to day, generally reflecting
current short-term interest rates and other market conditions.
SECURITIES AND INVESTMENT PRACTICES
The following pages contain more detailed information about types of
instruments in which a fund may invest, and strategies FMR may employ in
pursuit of a fund's investment objective. A summary of risks and
restrictions associated with these instrument types and investment
practices is included as well. A complete listing of each fund's policies
and limitations and more detailed information about each fund's investments
is contained in the funds ' SAI. Policies and limitations are
considered at the time of purchase; the sale of instruments is not required
in the event of a subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these techniques to
the full extent permitted unless it believes that doing so will help a fund
achieve its goal. Current holdings and recent investment strategies are
described in a fund's financial reports, which are sent to shareholders
twice a year. For a free SAI or financial report, call Fidelity Client
Services 1-800-843-3001.
MONEY MARKET SECURITIES are high-quality, short-term obligations issued by
the U.S. Government, corporations, financial institutions, municipalities,
local and state governments, and other entities. These obligations may
carry fixed, variable, or floating interest rates. Some money market
securities employ a trust or other similar structure to modify the
maturity, price characteristics, or quality of financial assets so that
they are eligible investments for money market funds. A security's credit
may be enhanced by a bank, insurance company, or other entity. If the
structure does not perform as intended, adverse tax or investment
consequences may result.
U.S. GOVERNMENT MONEY MARKET SECURITIES are short-term debt obligations
issued or guaranteed by the U.S. Treasury or by an agency or
instrumentality of the U.S. Government. Not all U.S. Government securities
are backed by the full faith and credit of the United States. For example,
securities issued by the Federal Farm Credit Bank or by the Federal
National Mortgage Association are supported by the instrumentality's right
to borrow money from the U.S. Treasury under certain circumstances.
However, securities issued by the Financing Corporation are supported only
by the credit of the entity that issued them.
MUNICIPAL SECURITIES are issued to raise money for a variety of public or
private purposes, including general financing for state and local
governments, or financing for specific projects or public facilities. They
may be issued in anticipation of future revenues, and may be backed by the
full taxing power of a municipality, the revenues from a specific project,
or the credit of a private organization. The value of some or all municipal
securities may be affected by uncertainties in the municipal market related
to legislation or litigation involving the taxation of municipal securities
or the rights of municipal securities holders. A fund may own a municipal
security directly or through a participation interest.
FOREIGN SECURITIES may involve different risks than domestic securities,
including risks relating to the political and economic conditions of the
foreign country involved, which could affect the payment of principal or
interest. Issuers of foreign securities include foreign governments,
corporations, and banks.
RESTRICTIONS: Treasury, Treasury II, Government, Domestic, Treasury
Only, and Tax-Exempt may not invest in foreign securities. Money Market may
not invest in foreign securities unless they are denominated in U.S.
dollars.
ASSET-BACKED SECURITIES include (i) interests in pools of mortgages, loans,
or receivables, (ii) pools of purchase contracts, financing leases, or
sales agreements entered into by municipalities, or (iii) pools of other
assets. Payment of principal and interest may be largely dependent upon the
cash flows generated by the assets backing the securities. Securities
backed by assets related to municipalities usually rely on continued
payments by such municipalities.
VARIABLE AND 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.
STRIPPED SECURITIES are the separate income or principal components of a
debt security. Their risks are similar to those of other money market
securities, although they may be more volatile.
REPURCHASE AGREEMENTS. In a repurchase agreement, a fund buys a security at
one price and simultaneously agrees to sell it back at a higher price.
Delays or losses could result if the other party to the agreement defaults
or becomes insolvent.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a fund
temporarily transfers possession of a portfolio instrument to another party
in return for cash. This could increase the risk of fluctuation in the
fund's yield or in the market value of its assets.
RESTRICTIONS. Subject to revision upon 90 days' notice to shareholders,
Treasury Only will not engage in reverse repurchase agreements.
Tax-Exempt and Treasury II do not intend to engage in reverse
repurchase agreements.
OTHER MONEY MARKET SECURITIES may include commercial paper, certificates of
deposit, bankers' acceptances, and time deposits.
MUNICIPAL LEASE OBLIGATIONS are used by municipalities to acquire land,
equipment, or facilities. If the municipality stops making payments or
transfers its obligations to a private entity, the obligation could lose
value or become taxable.
OTHER MUNICIPAL SECURITIES may include obligations of U.S. territories and
possessions such as Guam, the Virgin Islands, and Puerto Rico, and their
political subdivisions and public corporations.
PUT FEATURES entitle the holder to put (sell back) a security to the issuer
or a financial intermediary. In exchange for this benefit, a fund may pay
periodic fees or accept a lower interest rate. The credit quality of the
investment may be affected by the creditworthiness of the put provider.
Demand features, standby commitments, and tender options are types of put
features.
PRIVATE ENTITIES may be involved in some municipal securities. For example,
industrial revenue bonds are backed by private entities, and resource
recovery bonds often involve private corporations. The viability of a
project or tax incentives could affect the value and credit quality of
these securities.
ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined by
FMR, under the supervision of the Board of Trustees, to be illiquid
securities , which means that they may be difficult to sell promptly at
an acceptable price. The sale of some illiquid securities and some
other securities, may be subject to legal restrictions. Difficulty in
selling securities may result in a loss or may be costly to a fund.
RESTRICTIONS. A fund may not purchase a security if, as a result, more than
10% of its net assets would be invested in illiquid securities.
WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS are trading practices in
which payment and delivery for the securities take place at a future date.
The market value of a security could change during this period, which could
affect the market value of a fund's assets.
FINANCIAL SERVICES INDUSTRY. Companies in the financial services industry
are subject to various risks related to that industry, such as government
regulation, changes in interest rates, and exposure on loans, including
loans to foreign borrowers. If a fund invests substantially in this
industry, its performance may be affected by conditions affecting the
industry.
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce the
risks of investing. This may include limiting the amount of money invested
in any one issuer or, on a broader scale, in any one industry or type of
project. Economic, business, or political changes can affect all securities
of a similar type.
RESTRICTIONS: Each fund (other than Treasury Only and Tax-Exempt) may not
purchase a security, if, as a result, more than 5% of its total assets
would be invested in any issuer, except that, with respect to 25% of its
total assets, each fund (other than Treasury Only and Tax-Exempt) may
invest up to 10% of its total assets in the securities of any issuer.
With respect to 75% of its total assets,Tax-Exempt may not purchase a
security if, as a result, more than 5% of its total assets would be
invested in the securities of a single issuer.
These limitations do not apply to U.S. Government securities.
BORROWING. Each fund may borrow from banks or from other funds advised by
FMR, or through reverse repurchase agreements, and may make additional
investments while borrowings are outstanding.
RESTRICTIONS: Each fund, may borrow only for temporary or emergency
purposes, or (except for Tax-Exempt) engage in reverse repurchase
agreements, but not in an amount exceeding 33% of its total assets.
LENDING. A fund may lend money to other funds advised by FMR .
RESTRICTIONS: Loans, in the aggregate, may not exceed 33% of a fund's total
assets. Treasury , Treasury II, Government, Treasury Only and Tax-Exempt
do not intend to engage in lending.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
Some of the policies and restrictions discussed on the preceding pages are
fundamental, that is, subject to change only by shareholder approval. The
following paragraphs restate all those that are fundamental. All policies
stated throughout this prospectus, other than those identified in the
following paragraphs, can be changed without shareholder approval.
Treasury Only seeks as high a level of current income as is consistent
with the security of principal and liquidity, and to maintain a constant
NAV of $1.00.
Each of Treasury, Treasury II, Government, Domestic and Money
Market seeks 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 fund.
Tax-Exempt seeks as high a level of interest income exempt from federal
income tax as is consistent with a portfolio of high - quality,
short-term municipal obligations selected on the basis of liquidity and
stability of principal. The fund, under normal conditions, will invest
so that at least 80% of its income distributions is exempt from federal
income tax.
Each fund (other than Treasury Only and Tax-Exempt) may not purchase a
security, if, as a result, more than 5% of its total assets would be
invested in any issuer, except that, with respect to 25% of its total
assets, each fund (other than Treasury Only and Tax-Exempt) may invest up
to 10% of its total assets in the securities of any issuer.
With respect to 75% of its total assets, Tax-Exempt may not purchase a
security if, as a result, more than 5% of its total assets would be
invested in the securities of a single issuer.
Each fund may borrow only for temporary or emergency purposes, or
(except in Tax-Exempt) engage in reverse repurchase agreements, but not
in an amount exceeding 33% of its total assets.
Loans, in the aggregate, may not exceed 33% of a fund's total
assets.
BREAKDOWN OF EXPENSES
Like all mutual funds, the funds pay fees related to their daily
operations. E xpenses paid out of each class 's assets are
reflected in that class's share price or dividends; they are neither billed
directly to shareholders nor deducted from shareholder accounts.
Each fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. FMR in turn pays fees to an affiliate who provides
assistance with these services. Each fund also pays OTHER EXPENSES, which
are explained below.
MANAGEMENT FEE
FMR HAS SUB-ADVISORY AGREEMENTS with FMR Texas, which has primary
responsibility for providing investment management for each fund, while FMR
retains responsibility for providing the fund with other management
services. FMR pays FMR Texas 50% of its management fee (before
expense reimbursements) for these services . For fiscal 1995, FMR
paid FMR Texas the following percentages of each fund ' s average net
assets.
Fund Name Percentage of
Average
Net Assets
Treasury .10%
Treasury II .10%
Government .10%
Domestic .10%
Money Market .10%
Treasury Only .21%
Tax-Exempt .10%
OTHER EXPENSES
While the management fee is a significant component of each fund's annual
operating costs, the funds , other than Treasury Only, have other
expenses as well.
FIIOC performs transfer agency, dividend disbursing and shareholder
servicing functions for Class A shares of each of Treasury, Treasury II,
Government, Domestic, Money Market, and Treasury Only (the Taxable
Funds). Fidelity Service Co. (FSC) calculates the NAV and dividends for
Class A of each Taxable Fund , maintains the general
accounting records for Class A of each Taxable F und , and
administers the securities lending program for each Taxable
Fun d . For fiscal 1995, FIIOC and FSC received the following
fees:
Fund Name Percentage of Percentage of
Class A's Class A's
Average Net Average Net
Assets Assets Paid to
Paid to FIIOC FSC
Treasury .01% .01%
Treasury II .03% .01%
Government .01% .01%
Domestic .03% .01%
Money Market .01% .01%
Treasury Only -- --
UMB has entered into sub-arrangements pursuant to which FIIOC performs
certain transfer agency, dividend disbursing and shareholder services for
Class A shares of Tax-Exempt. UMB has entered into sub-arrangements
pursuant to which FSC calculates the NAV and dividends for Class A shares
of Tax-Exempt and maintains Tax-Exempt's general accounting records.
All of the fees are paid to FIIOC or FSC by UMB, which is reimbursed by
Class A or the fund, as applicable, for such payments.
In fiscal 1995, fees paid by UMB to FIIOC on behalf of Class A of
Tax-Exempt amounted to .02 % of Class A's average net assets, and
fees paid by UMB to FSC on behalf of Tax-Exempt amounted to .01 % of
the fund's average net assets.
Class A of each fund has adopted a DISTRIBUTION AND SERVICE PLAN. Each plan
recognizes that FMR may use its resources, including management fees, to
pay expenses associated with the sale of Class A shares. This may
include payments to third parties, such as banks or broker-dealers, that
provide shareholder support services or engage in the sale of the funds'
shares. The Board of Trustees of each fund has not authorized such
payments. Each fund does not pay FMR separate fees for this service.
E ach fund also pays other expenses, such as legal, audit, and
custodian fees; in some instances, proxy solicitation costs; and the
compensation of trustees who are not affiliated with Fidelity.
YOUR ACCOUNT
HOW TO BUY SHARES
If you are investing through a securities dealer, financial or other
institution (Financial Institution), contact that Financial Institution
directly. Certain features of a fund may be modified when it is made
available through a program of services offered by a Financial Institution,
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. It is the responsibility of your
Financial Institution to submit purchases and redemptions in order for you
to receive the next determined NAV.
EACH CLASS'S SHARE PRICE called NAV, is calculated every business day. The
funds are managed to keep share prices stable at $1.00. Each fund's shares
are sold without a sales charge.
Shares are purchased at the next NAV calculated after your order is
received and accepted by the transfer agent. NAV is normally calculated at
12:00 p.m. Eastern time for Treasury Only and Tax-Exempt; 3:00 p.m. Eastern
time for Treasury, Government, Domestic, and Money Market; and 3:00 p.m.
and 5:00 p.m. Eastern time for Treasury II.
IF YOU ARE NEW TO FIDELITY an initial investment must be preceded or
accompanied by a completed, signed application, which should be forwarded
to:
Fidelity Client Services
c/o Fidelity Institutional Money Market Funds
FIIOC
P.O. Box 1182
Boston, MA 02103-1182
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, YOU CAN
(small solid bullet) Place a purchase order and wire money into your
account, or
(small solid bullet) Open an account by exchanging from the same class of
any fund that is offered through this prospectus.
INVESTMENTS IN THE FUNDS MUST BE MADE USING THE FEDERAL RESERVE WIRE
SYSTEM. Checks will not be accepted as a means of investment.
BY TELEPHONE. For wiring information and instructions, you should call the
Financial Institution through which you trade , or if you trade
directly through Fidelity, call Fidelity Client Services. There is no
fee imposed by the funds for wire purchases. However, if you buy shares
through a Financial Institution, the Financial Institution may impose a fee
for wire purchases.
Fidelity Client Services:
Nationwide 1-800-843-3001
In order to receive same-day acceptance of your investment, you must
call Fidelity Client Services and place your order between 8:30 a.m.
and 12:00 p.m. Eastern time for Tax-Exempt and Treasury Only; 8:30 a.m. and
3:00 p.m. Eastern time for Treasury, Government, Domestic, and Money
Market ; and 8:30 a.m. and 5:00 p.m. Eastern time for Treasury II, on
days the fund is open for business .
If Fidelity Client Services is not advised of your purchase prior to the
stated cutoff time, your purchase will not be accepted by the transfer
agent. All wires must be received by the transfer agent in good order at
the applicable fund's designated wire bank before the close of the Federal
Reserve Wire System.
In order to purchase shares of Treasury II after 3:00 p.m. Eastern time,
you must contact Fidelity Client Services one week in advance to make
late-trading arrangements. In order to receive same-day acceptance of your
purchase order for Treasury II after 3:00 p.m. Eastern time, you must call
Fidelity Client Services as early in the day as possible. Wired money
for purchase orders for Treasury II placed after 3:00 p.m. Eastern
time that is not properly identified with a wire reference number will be
returned to the bank from which it was wired and will not be credited to
your account.
You are advised to wire funds as early in the day as possible, and to
provide advance notice to Fidelity Client Services for purchases over $10
million ($5 million for Treasury Only).
You will earn dividends on the day of your investment, provided (i)
you telephone Fidelity Client Services and place your trade between
8:30 a.m. and 12:00 p.m. Eastern time for Treasury Only and Tax-Exempt;
8:30 a.m. and 3:00 p.m. Eastern time for Treasury, Government, Domestic
and Money Market ; and 8:30 a.m. and 5:00 p.m. Eastern time for Treasury
II, on days the fund is open for business, and (ii) the fund's designated
wire bank receives the wire before the close of the Federal Reserve
Wire System on the day your purchase order is accepted by the
transfer agent .
MINIMUM INVESTMENTS
TO OPEN AN ACCOUNT $1,000,000
MINIMUM BALANCE $1,000,000
HOW TO SELL SHARES
You can arrange to take money out of your fund account at any time by
selling (redeeming) some or all of your shares. Your shares will be sold at
the next NAV calculated after your order is received and accepted by the
transfer agent. NAV is normally calculated at 12:00 p.m. Eastern time for
Tax-Exempt and Treasury Only, 3:00 p.m. Eastern time for Treasury,
Government, Domestic and Money Market , and 3:00 and 5:00 p.m. Eastern
time for Treasury II.
BY TELEPHONE. Redemption requests may be made by calling Fidelity Client
Services at the phone number listed on page . You must designate on
your account application the U.S. commercial bank account(s) into which you
wish the redemption proceeds to be deposited. Fidelity Client Services will
then notify you that this feature has been activated and that you may
request wire redemptions.
You may change the bank account(s) designated to receive redemption
proceeds at any time prior to making a redemption request. You should send
a letter of instruction, including a signature guarantee, to Fidelity
Client Services at the address shown on page .
There is no fee imposed by the funds for wiring of redemption proceeds.
However, if you buy shares through a Financial Institution, the Financial
Institution may impose a fee for wire redemptions.
You should be able to obtain a signature guarantee from a bank,
broker-dealer, credit union (if authorized under state law), securities
exchange or association, clearing agency, or savings association. A notary
public cannot provide a signature guarantee.
Redemption proceeds will be wired via the Federal Reserve Wire System to
your bank account of record. If your redemption request is
received by telephone between 8:30 a.m. and 12:00 p.m. Eastern time for
Tax-Exempt and Treasury Only, 8:30 a.m. and 3:00 p.m. Eastern time for
Treasury, Government, Domestic, and Money Market , and 8:30 a.m. and
5:00 p.m. Eastern time for redemptions from Treasury II, redemption
proceeds will normally be wired on the same day your redemption
request is received by the transfer agent .
A fund reserves the right to take up to seven days to pay you if making
immediate payment would adversely affect the fund.
In order to redeem shares of Treasury II after 3:00 p.m. Eastern
time, you must contact Fidelity Client Services one week in advance to
make late - trading arrangements .
You are advised to place your trades as early in the day as
possible.
INVESTOR SERVICES
Fidelity provides a variety of services to help you manage your account.
INFORMATION SERVICES
STATEMENTS AND REPORTS that the transfer agent sends to you include the
following:
(small solid bullet) Confirmation statements (after every transaction,
except a reinvestment, that affects your account balance or your account
registration)
(small solid bullet) Account statements (monthly)
(small solid bullet) Financial reports (every six months)
To reduce expenses, only one copy of most financial reports will be mailed,
even if you have more than one account in a fund. Call Fidelity
Client Services at 1-800-843-3001 if you need additional copies of
financial reports or historical account information.
SUB- A CCOUNTING AND SPECIAL SERVICES. Special processing has been
arranged with FIIOC for institutions that wish to open multiple accounts (a
master account and sub-accounts). You may be required to enter into a
separate agreement with FIIOC. Charges for these services, if any, will be
determined based on the level of services to be rendered.
SHAREHOLDER AND ACCOUNT POLICIES
DIVIDENDS, CAPITAL GAINS, AND TAXES
Each fund distributes substantially all of its net investment income and
capital gains, if any, to shareholders each year. Income dividends are
declared daily and paid monthly.
Income dividends declared are accrued daily throughout the month and are
distributed 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 on the day of redemption. Each fund
reserves the right to limit this service.
DISTRIBUTION OPTIONS
When you open an account, specify on your account application how you want
to receive your distributions. The funds offer two options:
1. REINVESTMENT OPTION. Your dividend and capital gain distributions, if
any, will be automatically reinvested in additional shares of the same
class of the fund. If you do not indicate a choice on your application,
you will be assigned this option.
2. CASH OPTION. You will be sent a wire for your dividend and capital gain
distributions, if any.
Dividends will be reinvested at each fund's Class A NAV on the last day
of the month. Capital gain distributions, if any, will be reinvested at the
NAV as of the record date of the distribution.
TAXES
As with any investment, you should consider how an investment in the funds
could affect you. Below are some of the funds' tax implications.
TAXES ON DISTRIBUTIONS. Interest income that Tax-Exempt earns is
distributed to shareholders as income dividends. Interest that is federally
tax-free remains tax-free when it is distributed. Distributions from the
Taxable Funds, however, are subject to federal income tax and may also be
subject to state or local taxes. If you live outside the United States,
your distributions from these funds could also be taxed by the country in
which you reside.
For federal tax purposes, the income and short-term capital gains
distributions from each of Treasury, Treasury II, Government, Domestic,
Money Market and Treasury Only are taxed as dividends. Long-term
capital gains distributions, if any, are taxed as long-term capital gains.
Mutual fund dividends from U.S. Government securities are generally
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. In addition, some states may impose intangible property taxes. You
should consult your own tax adviser for details and up-to-date information
on the tax laws in your state.
During the fiscal year ended March 31, 1995, the following percentages of
each fund's income distributions were derived from interest on
U.S. Government securities which is generally exempt from state
income tax: 30% for Treasury; 27% for Treasury II; 20 % for
Government; 2% for Domestic; 1% for Money Market; and 100% for Treasury
Only.
For shareholders of Tax-Exempt, gain on the sale of tax-free bonds results
in taxable distributions. S hort-term capital gains and a portion of
the gain on bonds purchased at a discount are taxed as dividends; long-term
capital gain distributions, if any, are taxed as long-term capital gains.
Distributions are taxable when they are paid, whether you take them in cash
or reinvest them. However, distributions declared in December and paid in
January are taxable as if they were paid on December 31.
Every January, the transfer agent will send you and the IRS a statement
showing the taxable distributions paid to you in the previous year.
A portion of Tax-Exempt's dividends may be free from state or local taxes.
Income from investments in your state are often tax-free to you. Each year,
the transfer agent will send you a breakdown of Tax-Exempt's income from
each state to help you calculate your taxes.
During the fiscal year ended March 31, 1995, 100% of Tax-Exempt's income
dividends was free from federal income tax.
EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on Money
Market and its investments and these taxes generally will reduce the fund's
distributions.
There are tax requirements that all funds must follow in order to avoid
federal taxation. In its effort to adhere to these requirements, the fund
may have to limit its investment activity in some types of instruments.
TRANSACTION DETAILS
EACH FUND IS OPEN FOR BUSINESS and its NAV is normally calculated each day
that both the Federal Reserve Bank of New York (New York Fed) (for all
Taxable Funds) or the Federal Reserve Bank of Kansas City (Kansas City Fed)
(for Tax-Exempt) and the New York Stock Exchange (NYSE) are open. The
following holiday closings have been scheduled for 1995: New Year's Day
(observed), Martin Luther King 's Birthday, Washington's Birthday, 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, the Kansas City
Fed, or the NYSE may modify its holiday schedule at any time. On any day
that the New York Fed, the Kansas City Fed, or the NYSE closes early, the
principal government securities markets close early (such as on days in
advance of holidays generally observed by participants in such markets), or
as permitted by the SEC, the right is reserved to advance the time on that
day by which purchase and redemption orders must be received.
To the extent that portfolio securities are traded in other markets on days
when the New York Fed, the Kansas City Fed, or the NYSE is closed, each
fund's NAV may be affected on days when investors do not have access to the
fund to purchase or redeem shares. Certain Fidelity funds may follow
different holiday closing schedules.
A CLASS' NAV is the value of a single share. The NAV of Class A of each
fund is computed by adding Class A's pro rata share of the value of the
fund's investments, cash, and other assets, subtracting Class A's pro rata
share of the value of the fund's liabilities, subtracting the liabilities
directly attributed to Class A, and dividing the result by the number of
Class A shares of that fund that are outstanding. Each fund values its
portfolio securities on the basis of amortized cost. This method minimizes
the effect of changes in a security's market value and helps each fund
maintain a stable $1.00 share price.
THE OFFERING PRICE (price to buy one share) and REDEMPTION PRICE (price to
sell one share) of Class A are its NAV.
WHEN YOU SIGN YOUR ACCOUNT APPLICATION, you will be asked to certify that
your social security or taxpayer identification number is correct and that
you are not subject to 31% backup withholding for failing to report income
to the IRS. If you violate IRS regulations, the IRS can require a fund to
withhold 31% of your taxable distributions and redemptions.
YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE. Fidelity and the transfer
agent may only be liable for losses resulting from unauthorized
transactions if they do not follow reasonable procedures designed to verify
the identity of the caller. Fidelity and the transfer agent will request
personalized security codes or other information, and may also record
calls. You should verify the accuracy of the confirmation statements
immediately after receipt. If you do not want the ability to redeem and
exchange by telephone, call the transfer agent for instructions. Additional
documentation may be required from corporations, associations and certain
fiduciaries.
EACH FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES for a period
of time. Each fund also reserves the right to reject any specific purchase
order, including certain purchases by exchange. See "Exchange Restrictions"
on page . Purchase orders may be refused if, in FMR's opinion, they
would disrupt management of a fund.
TO ALLOW FMR TO MANAGE THE FUNDS MOST EFFECTIVELY, you are urged to
initiate all trades as early in the day as possible and to notify Fidelity
Client Services in advance of transactions in excess of $10 million for
Tax-Exempt and each FICP fund, and $5 million for Treasury Only.
WHEN YOU PLACE AN ORDER TO BUY SHARES, your shares will be purchased at the
next NAV calculated after your order is received and accepted by the
transfer agent. Note the following:
(small solid bullet) All of your purchases must be made by federal fund
wire; checks will not be accepted for purchases.
(small solid bullet) If your wire is not received by the close of the
Federal Reserve Wire System, you could be liable for any losses or fees a
fund or Fidelity has incurred, or for interest and penalties.
Net interest income for dividend purposes is determined by FSC on a daily
basis and shall be payable to shareholders of record at the time of its
declaration (including, for this purpose, holders of Class A shares
purchased, but excluding holders of shares redeemed, on that day).
The income declared for Treasury II is based on estimates of net interest
income for the fund. Actual income may differ from estimates and
differences, if any, will be included in the calculation of subsequent
dividends.
Shareholders of record as of 12:00 p.m. Eastern time for Tax-Exempt and
Treasury-Only, or 3:00 p.m. Eastern time for the FICP funds
(5:00 p.m. Eastern time for Treasury II) will be entitled to
dividends declared that day.
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at the
next NAV calculated after your order is received and accepted by
the transfer agent . Note the following:
(small solid bullet) Shares redeemed do not receive the dividend declared
on the day of redemption.
(small solid bullet) A fund may withhold redemption proceeds until it is
reasonably assured that investments credited to your account have been
received and collected.
When the NYSE, the Kansas City Fed, or the New York Fed 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, a fund may suspend redemption or postpone payment
dates. In cases of suspension of the right of redemption, the request for
redemption may either be withdrawn or payment may be made based on the NAV
next determined after the termination of the suspension.
IF YOUR ACCOUNT BALANCE FALLS BELOW $1,000,000 due to redemption,
the account may be closed and the proceeds may be wired to the bank account
of record. You will be given 30 days ' notice that your account will
be closed unless it is increased to the minimum.
THE TRANSFER AGENT MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
EXCHANGE RESTRICTIONS
As a shareholder you have the privilege of exchanging Class A shares of any
fund offered through this prospectus at no charge for Class A shares of any
other fund offered through this prospectus.
An exchange involves the redemption of all or a portion of the shares of
one fund and the purchase of shares of another fund.
BY TELEPHONE. Exchanges may be requested on any day a fund is open for
business by calling Fidelity Client Services (at the number listed
on page ) between 8:30 a . m . and 12:00 p . m .
Eastern time for Treasury Only and Tax-Exempt ; and
8:30 a . m . and 3:00 p . m . Eastern time for
Treasury, Government, Domestic, Money Market and Treasury II.
BY MAIL. You may exchange shares on any business day by submitting written
instructions with an authorized signature which is on file for that
account. Written requests for exchanges should contain the fund name,
account number, the number of shares to be redeemed, and the name of
the fund to be purchased. Written requests for exchange should be mailed to
Fidelity Client Services at the address on page .
WHEN YOU PLACE AN ORDER TO EXCHANGE SHARES, Class A shares will be redeemed
at the next determined NAV after your order is received and accepted by
the transfer agent . Shares of the fund to be acquired will be purchased
at its next determined NAV after redemption proceeds are made available.
You should note that, under certain circumstances, a fund may take up to
seven days to make redemption proceeds available for the exchange purchase
of shares of another fund. In addition, please note the following:
(small solid bullet) The fund you are exchanging into must be registered
for sale in your state.
(small solid bullet) You may only exchange between accounts that are
registered in the same name, address, and taxpayer identification number.
(small solid bullet) Before exchanging into a fund, read its prospectus.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Each fund reserves the right to refuse exchange
purchases by any person or group if, in FMR's judgment, the fund would be
unable to invest the money effectively in accordance with its investment
objective and policies, or would otherwise potentially be adversely
affected.
(small solid bullet) Your exchanges may be restricted or refused if a fund
receives or anticipates simultaneous orders affecting significant portions
of a fund's assets. In particular, a pattern of exchanges that coincides
with a "market timing" strategy may be disruptive to a fund.
(small solid bullet) Exchanges will not be permitted until a completed and
signed account application is on file.
(small solid bullet) You will earn dividends in the acquired fund in
accordance with the fund's customary policy, normally on the day the
exchange request is received.
Although the funds will attempt to give you prior notice whenever they are
reasonably able to do so, they may impose these restrictions at any time.
The funds reserve the right to terminate or modify the exchange privilege
in the future.
No dealer, sales representative or any other person has been authorized to
give any information or to make any representations, other than those
contained in this Prospectus and in the related SAI, in connection with the
offer contained in this Prospectus. If given or made, such other
information or representations must not be relied upon as having been
authorized by the fund or FDC. This Prospectus and the related SAI do not
constitute an offer by the fund or by FDC to sell or to buy shares of a
fund to any person to whom it is unlawful to make such offer.
FIDELITY INSTITUTIONAL MONEY MARKET FUNDS : CLASS A
FIDELITY INSTITUTIONAL CASH PORTFOLIOS :
Domestic, Government, Money Market
Treasury, Treasury II,
FIDELITY INSTITUTIONAL TAX-EXEMPT CASH PORTFOLIOS:
Tax-Exempt
DAILY MONEY FUND:
Treasury Only
STATEMENT OF ADDITIONAL INFORMATION
JULY 1, 1995
This Statement of Additional Information (SAI) is not a prospectus
but should be read in conjunction with the funds' current Prospectus (dated
July 1, 1995). Please retain this document for future reference. The funds'
financial statements and financial highlights, included in the Annual
Report, for the fiscal year ended March 31, 1995, are incorporated herein
by reference. To obtain an additional copy of the Prospectus or the Annual
Report, please call Fidelity Distributors Corporation at 1-800-544-8888.
TABLE OF CONTENTS PAGE
Investment Policies and Limitation s
Portfolio Transactions
Valuation
Performance
Additional Purchase, Exchange and Redemption Information
Distributions and Taxes
FMR
Trustees and Officers
Management Contracts
Contracts with FMR Affiliates
Distribution and Service Plan s
Description of the Trusts
Financial Statements
Appendix
INVESTMENT ADVISER
Fidelity Management & Research Company (FMR)
SUB-ADVISER
FMR Texas Inc. (FMR Texas)
DISTRIBUTOR
Fidelity Distributors Corporation (FDC)
TRANSFER AGENT FOR TAXABLE FUNDS
Fidelity Investments Institutional Operations Company (FIIOC)
TRANSFER AGENT FOR TAX-EXEMPT
UMB Bank, n.a. (UMB)
IMM-ptb-795
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 fund'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 fund'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 each fund's investment policies and
limitations.
Each fund'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 each fund. 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.
INVESTMENT LIMITATIONS OF FIDELITY INSTITUTIONAL CASH PORTFOLIOS:
TREASURY
THE FOLLOWING ARE TREASURY'S FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH
IN THEIR ENTIRETY. THE FUND 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 1940;
(3) borrow money, except that the fund 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 fund'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
fund 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 fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same 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) The fund 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 fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund 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.
(ii) The fund does not currently intend to purchase securities on margin,
except that the fund 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.
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or fund for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party. The fund will not purchase any security while borrowings
(excluding reverse repurchase agreements) representing more than 5% of its
total assets are outstanding. The fund 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 fund's total
assets.
(iv) The fund 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.
(v) The fund 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) The fund 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.
(vii) The fund does not currently intend to make loans, but this limitation
does not apply to purchases of debt securities or to repurchase agreements.
(viii) The fund does not currently intend to invest in interests in real
estate investment trusts that are not readily marketable, or to invest in
interests in real estate limited partnerships that are not listed on the
New York Stock Exchange (NYSE) or the American Stock Exchange
(AMEX) or traded on the NASDAQ National Market System.
(ix) The fund does not currently intend to purchase the securities of any
issuer if those officers and Trustees of the Trust and those officers and
directors of FMR who individually own more than 1/2 of 1% of the securities
of such issuer together own more than 5% of such issuer's securities.
(x) The fund does not currently intend to invest in oil, gas, or other
mineral exploration or development programs or leases.
(xi) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company managed by
FMR or an affiliate or successor with substantially the same fundamental
investment objective, policies, and limitations as the fund.
For the fund's policies on quality and maturity, see section entitled
"Quality and Maturity" on page .
INVESTMENT LIMITATIONS OF FIDELITY INSTITUTIONAL CASH PORTFOLIOS:
TREASURY II
THE FOLLOWING ARE TREASURY II'S FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. THE FUND 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 fund 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 fund'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
fund 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 fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same 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) The fund 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 fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund 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.
(ii) The fund does not currently intend to purchase securities on margin,
except that the fund 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.
(iii) The fund may borrow money only from a bank or from a registered
investment company or fund for which FMR or an affiliate serves as
investment adviser. The fund will not purchase any security while
borrowings representing more than 5% of its total assets are outstanding.
The fund 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 fund's total assets.
(iv) The fund 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.
(v) The fund 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.
(vi) The fund does not currently intend to make loans, but this limitation
does not apply to purchases of debt securities or to repurchase agreements.
(vii) The fund does not currently intend to invest in interests in real
estate investment trusts that are not readily marketable, or to invest in
interests in real estate limited partnerships that are not listed on the
NYSE or the A M E X or traded on the NASDAQ National Market
System.
(viii) The fund 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.
(ix) The fund does not currently intend to invest in oil, gas, or other
mineral exploration or development programs or leases.
(x) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company managed by
FMR or an affiliate or successor with substantially the same fundamental
investment objective, policies, and limitations as the fund.
For the fund's policies on quality and maturity, see section entitled
"Quality and Maturity" on page .
INVESTMENT LIMITATIONS OF FIDELITY INSTITUTIONAL CASH PORTFOLIOS:
GOVERNMENT
THE FOLLOWING ARE GOVERNMENT'S FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH
IN THEIR ENTIRETY. THE FUND 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 fund 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 fund'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
fund 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 fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same 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) The fund 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 fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund 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
fund 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 fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(iii) The fund does not currently intend to purchase securities on margin,
except that the fund 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) The fund may borrow money only (a) from a bank or from a registered
investment company or fund for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party. The fund will not purchase any security while borrowings
(excluding reverse repurchase agreements) representing more than 5% of its
total assets are outstanding. The fund 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 fund's total
assets.
(v) The fund 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) The fund does not currently intend to purchase or sell futures
contracts or call options. This limitation does not apply to options
attached to, or acquired or traded together with, their underlying
securities, and does not apply to securities that incorporate features
similar to options or futures contracts.
(vii) The fund 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.
(viii) The fund does not currently intend to make loans, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements.
(ix) The fund does not currently intend to invest in interests in real
estate investment trusts that are not readily marketable, or to invest in
interests in real estate limited partnerships that are not listed on the
NYSE or the A M E X or traded on the NASDAQ National Market
System.
(x) The fund does not currently intend to invest in oil, gas, or other
mineral exploration or development programs or leases.
(xi) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company managed by
FMR or an affiliate or successor with substantially the same fundamental
investment objective, policies, and limitations as the fund.
For the fund's policies on quality and maturity, see section entitled
"Quality and Maturity" on page .
INVESTMENT LIMITATIONS OF FIDELITY INSTITUTIONAL CASH PORTFOLIOS:
DOMESTIC
THE FOLLOWING ARE DOMESTIC'S FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH
IN THEIR ENTIRETY. THE FUND 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 fund 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 fund'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
fund may be considered an underwriter within the meaning of the
Securities Act of 1933 Act 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 fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry, except that the fund 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) The fund 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 fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund 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
fund 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 fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(iii) The fund does not currently intend to purchase securities on margin,
except that the fund 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) The fund may borrow money only (a) from a bank or from a registered
investment company or fund for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party. The fund will not purchase any security while borrowings
(excluding reverse repurchase agreements) representing more than 5% of its
total assets are outstanding. The fund 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 fund's total
assets.
( v ) The fund 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 ) The fund does not currently intend to purchase or sell futures
contracts or call options. This limitation does not apply to options
attached to, or acquired or traded together with, their underlying
securities, and does not apply to securities that incorporate features
similar to options or futures contracts.
( vii ) The fund does not currently intend to lend assets other than
securities to other parties, except by lending money (up to 10% of the
fund's net assets) to a registered investment company or portfolio
for which FMR or an affiliate serves as investment adviser. (This
limitation does not apply to purchases of debt securities or to repurchase
agreements.)
( viii ) The fund 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.
( i x) The fund does not currently intend to invest in interests in
real estate investment trusts that are not readily marketable, or to invest
in interests in real estate limited partnerships that are not listed on the
NYSE or the A MEX or traded on the NASDAQ National Market System.
( x ) The fund 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.
( xi ) The fund does not currently intend to invest in oil, gas, or
other mineral exploration or development programs or leases.
(x i i) The fund does not currently intend to invest all of its assets
in the securities of a single open-end management investment company
managed by FMR or an affiliate or successor with substantially the same
fundamental investment objective, policies, and limitations as the fund.
For the fund's policies on quality and maturity, see section entitled
"Quality and Maturity" on page .
INVESTMENT LIMITATIONS OF FIDELITY INSTITUTIONAL CASH PORTFOLIOS:
MONEY MARKET
THE FOLLOWING ARE MONEY MARKET'S FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. THE FUND 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 Act ;
(3) borrow money, except that the fund 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 fund'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
fund 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 fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry, except that the fund 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) The fund 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 fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund 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
fund 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 fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(iii) The fund does not currently intend to purchase securities on margin,
except that the fund 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) The fund may borrow money only (a) from a bank or from a registered
investment company or fund for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party. The fund will not purchase any security while borrowings
(excluding reverse repurchase agreements) representing more than 5% of its
total assets are outstanding. The fund 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 fund's total
assets.
(v) The fund 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) The fund does not currently intend to purchase or sell futures
contracts or call options. This limitation does not apply to options
attached to, or acquired or traded together with, their underlying
securities, and does not apply to securities that incorporate features
similar to options or futures contracts.
(vii) The fund does not currently intend to lend assets other than
securities to other parties, except by lending money (up to 10% of the
fund's net assets) to a registered investment company or fund for which FMR
or an affiliate serves as investment adviser. (This limitation does not
apply to purchases of debt securities or to repurchase agreements.)
(viii) The fund 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) The fund does not currently intend to invest in interests in real
estate investment trusts that are not readily marketable, or to invest in
interests in real estate limited partnerships that are not listed on the
NYSE or the A MEX or traded on the NASDAQ National Market System.
(x) The fund 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.
(xi) The fund does not currently intend to invest in oil, gas, or other
mineral exploration or development programs or leases.
(xii) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company managed by
FMR or an affiliate or successor with substantially the same fundamental
investment objective, policies, and limitations as the fund.
For the fund's policies on quality and maturity, see section entitled
"Quality and Maturity" on page .
INVESTMENT LIMITATIONS OF TAX-EXEMPT
THE FOLLOWING ARE TAX-EXEMPT'S FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH
IN THEIR ENTIRETY. THE FUND MAY NOT:
(1) with respect to 75% of the fund's total assets, purchase the securities
of any issuer (other than securities issued or guaranteed by the U.S.
Government, or any of its agencies, or instrumentalities) if, as a result
thereof, (a) more than 5% of the fund's total assets would be invested in
the securities of that issuer, or (b) the fund would hold more than 10% of
the outstanding voting securities of that issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940 ;
(3) make short sales of securities;
(4) purchase any securities on margin, except for such short-term credits
as are necessary for the clearance of transactions;
(5) borrow money, except for temporary or emergency purposes (not for
leveraging or investment) in an amount not to exceed 33 1/3% of the value
of the fund's total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that come to exceed 33 1/3% of the
fund's assets by reason of a decline in net assets will be reduced within
three days (exclusive of Sundays and Holidays) to the extent necessary to
comply with the 33 1/3% limitation;
(6) underwrite securities issued by others, except to the extent that the
fund may be considered an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted securities;
(7) purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. Government, or any of its agencies,
instrumentalities, territories or possessions, or issued or guaranteed by a
state government or political subdivision thereof) if as a result more than
25% of the value of its total assets would be invested in securities of
companies having their principal business activities in the same industry;
(8) purchase or sell real estate, but this shall not prevent the fund from
investing in municipal bonds or other obligations secured by real estate or
interest therein;
(9) purchase or sell physical commodities;
(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); or
(11) invest in oil, gas or other mineral exploration or development
programs.
(12) The fund 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 fund.
For purposes of limitations (1) and (7), FMR identifies the issuer of a
security depending on the terms and conditions of the security. In
identifying the issuer, FMR will consider the entity or entities
responsible for payment of interest and repayment of principal and the
source of such payments; the way in which assets and revenues of an issuing
political subdivision are separated from those of other political entities;
and whether a governmental body is guaranteeing the security.
THE FOLLOWING LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE CHANGED WITHOUT
SHAREHOLDER APPROVAL.
(i) The fund may borrow money only (a) from a bank or from a registered
investment company or fund for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party. The fund will not purchase any security while borrowings
(excluding reverse repurchase agreements) representing more than 5% of its
total assets are outstanding. The fund 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 fund's total
assets.
(ii) The fund 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.
(iii) The fund does not currently intend to invest more than 25% of its
total assets in industrial revenue bonds related to a single industry.
(iv) The fund 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.
(v) The fund does not currently intend to engage in repurchase agreements
or make loans, but this limitation does not apply to purchases of debt
securities.
(vi) The fund 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.
For the fund's policies on quality and maturity, see the section entitled
"Quality and Maturity" on page .
INVESTMENT LIMITATIONS OF TREASURY ONLY
THE FOLLOWING ARE TREASURY ONLY'S FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. THE FUND MAY NOT:
(1) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(2) borrow money, except that the fund 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 fund'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;
(3) underwrite securities issued by others, except to the extent that the
fund may be considered an underwriter within the meaning of the
Securities Act of 1933 in the disposition of restricted
securities;
(4) purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. Government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry;
(5) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(6) purchase or sell physical commodities unless acquired as a result of
ownership of securities or other instruments; or
(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) The fund 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 fund.
THE FOLLOWING LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED WITHOUT
SHAREHOLDER APPROVAL:
(i) The fund may borrow money only (a) from a bank or from a registered
investment company or fund for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party. The fund will not purchase any security while borrowings
representing more than 5% of its total assets are outstanding. The fund
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 fund's total assets.
(ii) The fund does not currently intend to make loans, but this limitation
does not apply to purchases of debt securities.
(i ii ) The fund 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 fund.
For the fund's policies on quality and maturity, see the section entitled
"Quality and Maturity" below.
Each funds' 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 funds.
AFFILIATED BANK TRANSACTIONS. A fund may engage in transactions with
financial institutions that are, or may be considered to be, "affiliated
persons" of the fund under the 1940 Act. These transactions may include
repurchase agreements with custodian banks; short-term obligations of, and
repurchase agreements with, the 50 largest U.S. banks (measured by
deposits); municipal securities; U.S. Government securities with affiliated
financial institutions that are primary dealers in these securities;
short-term currency transactions; and short-term borrowings. In accordance
with exemptive orders issued by the Securities and Exchange Commission
(SEC), the Board of Trustees has established and periodically reviews
procedures applicable to transactions involving affiliated financial
institutions.
ASSET-BACKED SECURITIES 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 entities providing
the credit support.
DELAYED-DELIVERY TRANSACTIONS. Each fund may buy and sell securities
on a delayed-delivery or when-issued basis. These transactions involve a
commitment by a fund to purchase or sell specific securities at a
predetermined price or yield, with payment and delivery taking place after
the customary settlement period for that type of security .
Typically, no interest accrues to the purchaser until the security is
delivered.
When purchasing securities on a delayed-delivery basis, each fund assumes
the rights and risks of ownership, including the risk of price and yield
fluctuations. Because a fund is not required to pay for securities until
the delivery date, these risks are in addition to the risks associated with
the fund's other investments. If a fund 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 fund will set aside
appropriate liquid assets in a segregated custodial account to cover its
purchase obligations. When a fund has sold a security on a delayed-delivery
basis, the fund 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 fund could miss
a favorable price or yield opportunity, or could suffer a loss.
Each fund 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.
DOMESTIC AND FOREIGN ISSUERS. Investments may be made in U.S.
dollar-denominated time deposits, certificates of deposit, and bankers'
acceptances of U.S. banks and their branches located outside of the United
States, U.S. branches and agencies of foreign banks, and foreign branches
of foreign banks. A fund may also invest in U.S. dollar-denominated
securities issued or guaranteed by other U.S. or foreign issuers, including
U.S. and foreign corporations or other business organizations, foreign
governments, foreign government agencies or instrumentalities, and U.S. and
foreign financial institutions, including savings and loan institutions,
insurance companies, mortgage bankers, and real estate investment trusts,
as well as banks.
The obligations of foreign branches of U.S. banks may be general
obligations of the parent bank in addition to the issuing branch, or may be
limited by the terms of a specific obligation and by governmental
regulation. Payment of interest and principal on these obligations may also
be affected by governmental action in the country of domicile of the branch
(generally referred to as sovereign risk). In addition, evidence of
ownership of portfolio securities may be held outside of the United
States and the fund may be subject to the risks associated with the holding
of such property overseas. Various provisions of federal law governing the
establishment and operation of U.S. branches do not apply to foreign
branches of U.S. banks.
Obligations of U.S. branches and agencies of foreign banks may be general
obligations of the parent bank in addition to the issuing branch, or may be
limited by the terms of a specific obligation and by federal and state
regulation, as well as by governmental action in the country in which the
foreign bank has its head office.
Obligations of foreign issuers involve certain additional risks. These
risks may include future unfavorable political and economic developments,
withholding taxes, seizures of foreign deposits, currency controls,
interest limitations, or other governmental restrictions that might affect
payment of principal or interest , or the ability to honor a credit
committment . Additionally, there may be less public information
available about foreign entities . Foreign issuers may be subject to
less governmental regulation and supervision than U.S. issuers. Foreign
issuers also generally are not bound by uniform accounting, auditing and
financial reporting requirements comparable to those applicable to U.S.
issuers.
FEDERALLY TAXABLE OBLIGATIONS. Under normal conditions, Tax-Exempt does
not intend to invest in securities whose interest is federally taxable.
However, from time to time on a temporary basis, Tax-Exempt may invest a
portion of its assets in fixed-income obligations whose interest is subject
to federal income tax.
Should Tax-Exempt invest in federally taxable obligations, it would
purchase securities that, in FMR's judgment, are of high quality. These
obligations would include those issued or guaranteed by the U.S.
G overnment or its agencies or instrumentalities and
repurchase agreements backed by such obligations .
Proposals to restrict or eliminate the federal income tax exemption for
interest on municipal obligations are introduced before Congress from time
to time. Proposals also may be introduced before state legislatures
that would affect the state tax treatment of Tax-Exempt's
distributions. If such proposals were enacted, the availability of
municipal obligations and the value of Tax-Exempt's funds' holdings
would be affected , and the Trustees would reevaluate
Tax-Exempt's investment objectives and policies.
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 fund's investments and, through reports from FMR, the
Board monitors investments in illiquid instruments. In determining the
liquidity of a fund'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 fund's rights and
obligations relating to the investment).
Investments currently considered by the funds to be illiquid include
repurchase agreements not entitling the holder to payment of principal and
interest within seven days. Also, FMR may determine some restricted
securities, time deposits, and municipal lease obligations 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, a fund 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. Pursuant to an exemptive order issued by the
SEC, each fund has received permission to lend money to, and borrow money
from, other funds advised by FMR or its affiliates. Tax-Exempt
will participate in the interfund borrowing program only as a
borrower. Interfund loans and borrowings normally extend overnight, but
can have a maximum duration of seven days. Loans may be called on one day's
notice. Treasury II, Treasury Only, Domestic , Money
Market , Government and Treasury will lend through the program only
when the returns are higher than those available from other short-term
instruments (such as repurchase agreements). A fund will borrow through the
program only when the costs are equal to or lower than the cost of bank
loans. A fund 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. Treasury, Treasury II, Government and Treasury Only do
not currently intend to participate in the program except as a lender.
MARKET DISRUPTION RISK. The value of municipal securities may be
affected by uncertainties in the municipal market related to legislation or
litigation involving the taxation of municipal securities or the rights of
municipal securities holders in the event of a bankruptcy. Municipal
bankruptcies are relatively rare, and certain provisions of the U.S.
Bankruptcy Code governing such bankruptcies are unclear and remain
untested. Further, the application of state law to municipal issuers could
produce varying results among the states or among municipal securities
issuers within a state. These legal uncertainties could affect the
municipal securities market generally, certain specific segments of the
market, or the relative credit quality of particular securities. Any of
these effects could have a significant impact on the prices of some or all
of the municipal securities held by a fund, making it more difficult for
the fund to maintain a stable net asset value per share.
MONEY MARKET SECURITIES are high-quality, short-term obligations. Some
money market securities employ a trust or other similar structure to modify
the maturity, price characteristics, or quality of financial assets. For
example, put features can be used to modify the maturity of a security or
interest rate adjustment features can be used to enhance price stability.
If the structure does not perform as intended, adverse tax or investment
consequences may result. Neither the Internal Revenue Service (IRS) nor any
other regulatory authority has ruled definitively on certain legal issues
presented by structured securities. Future tax or other regulatory
determinations could adversely affect the value, liquidity, or tax
treatment of the income received from these securities or the nature and
timing of distributions made by the funds.
MUNICIPAL LEASE S and participation interests therein may take the form
of a lease, an installment purchase, or a conditional sale contract, and
are issued by state and local governments and authorities to acquire land
or a wide variety of equipment and facilities. Generally, the funds will
not hold such obligations directly as a lessor of the property, but will
purchase a participation interest in a municipal obligation from a bank or
other third party. A participation interest gives a fund a specified,
undivided interest in the obligation in proportion to its purchased
interest in the total amount of the obligation.
Municipal leases frequently have risks distinct from those associated with
general obligation or revenue bonds. State constitutions and statutes set
forth requirements that states or municipalities must meet to incur debt.
These may include voter referenda, interest rate limits, or public sale
requirements. Leases, installment purchases, or conditional sale contracts
(which normally provide for title to the leased asset to pass to the
governmental issuer) have evolved as a means for governmental issuers to
acquire property and equipment without meeting their constitutional and
statutory requirements for the issuance of debt. Many leases and contracts
include "non-appropriation clauses" providing that the governmental issuer
has no obligation to make future payments under the lease or contract
unless money is appropriated for such purposes by the appropriate
legislative body on a yearly or other periodic basis. Non-appropriation
clauses free the issuer from debt issuance limitations.
MUNICIPAL SECTORS:
ELECTRIC UTILITIES INDUSTRY. The electric utilities industry has been
experiencing, and will continue to experience, increased competitive
pressures. Federal legislation in the last two years will open transmission
access to any electricity supplier, although it is not presently known to
what extent competition will evolve. Other risks include: (a) the
availability and cost of fuel, (b) the availability and cost of capital,
(c) the effects of conservation on energy demand, (d) the effects of
rapidly changing environmental, safety, and licensing requirements, and
other federal, state, and local regulations, (e) timely and sufficient rate
increases, and (f) opposition to nuclear power.
HEALTH CARE INDUSTRY. The health care industry is subject to regulatory
action by a number of private and governmental agencies, including federal,
state, and local governmental agencies. A major source of revenues for the
health care industry is payments from the Medicare and Medicaid programs.
As a result, the industry is sensitive to legislative changes and
reductions in governmental spending for such programs. Numerous other
factors may affect the industry, such as general and local economic
conditions; demand for services; expenses (including malpractice insurance
premiums); and competition among health care providers. In the future, the
following elements may adversely affect health care facility operations:
adoption of legislation proposing a national health insurance program;
other state or local health care reform measures; medical and technological
advances which dramatically alter the need for health services or the way
in which such services are delivered; changes in medical coverage which
alter the traditional fee-for-service revenue stream; and efforts by
employers, insurers, and governmental agencies to reduce the costs of
health insurance and health care services.
HOUSING. Housing revenue bonds are generally issued by a state, county,
city, local housing authority, or other public agency. They generally are
secured by the revenues derived from mortgages purchased with the proceeds
of the bond issue. It is extremely difficult to predict the supply of
available mortgages to be purchased with the proceeds of an issue or the
future cash flow from the underlying mortgages. Consequently, there are
risks that proceeds will exceed supply, resulting in early retirement of
bonds, or that homeowner repayments will create an irregular cash flow.
Many factors may affect the financing of multi-family housing projects,
including acceptable completion of construction, proper management,
occupancy and rent levels, economic conditions, and changes to current laws
and regulations.
EDUCATION. In general, there are two types of education-related bonds;
those issued to finance projects for public and private colleges and
universities, and those representing pooled interests in student loans.
Bonds issued to supply educational institutions with funds are subject to
the risk of unanticipated revenue decline, primarily the result of
decreasing student enrollment or decreasing state and federal funding.
Among the factors that may lead to declining or insufficient revenues are
restrictions on students' ability to pay tuition, availability of state and
federal funding, and general economic conditions. Student loan revenue
bonds are generally offered by state (or substate) authorities or
commissions and are backed by pools of student loans. Underlying student
loans may be guaranteed by state guarantee agencies and may be subject to
reimbursement by the United States Department of Education through its
guaranteed student loan program. Others may be private, uninsured loans
made to parents or students which are supported by reserves or other forms
of credit enhancement. Recoveries of principal due to loan defaults may be
applied to redemption of bonds or may be used to re-lend, depending on
program latitude and demand for loans. Cash flows supporting student loan
revenue bonds are impacted by numerous factors, including the rate of
student loan defaults, seasoning of the loan portfolio, and student
repayment deferral during periods of forbearance. Other risks associated
with student loan revenue bonds include potential changes in federal
legislation regarding student loan revenue bonds, state guarantee agency
reimbursement and continued federal interest and other program subsidies
currently in effect.
WATER AND SEWER. Water and sewer revenue bonds are often considered to have
relatively secure credit as a result of their issuer's importance, monopoly
status, and generally unimpeded ability to raise rates. Despite this, lack
of water supply due to insufficient rain, run-off, or snow pack is a
concern that has led to past defaults. Further, public resistance to rate
increases, costly environmental litigation, and federal environmental
mandates are challenges faced by issuers of water and sewer bonds.
TRANSPORTATION. Transportation debt may be issued to finance the
construction of airports, toll roads, highways or other transit
facilities. Airport bonds are dependent on the general stability of the
airline industry and on the stability of a specific carrier who uses the
airport as a hub. Air traffic generally follows broader economic trends and
is also affected by the price and availability of fuel. Toll road bonds are
also affected by the cost and availability of fuel as well as toll levels,
the presence of competing roads, and the general economic health of the
area. Fuel costs and availability also affect other transportation-related
securities, as does the presence of alternate forms of transportation, such
as public transportation.
PUT FEATURES entitle the holder to sell a security back 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 other entities . Demand features, standby commitments,
and tender options are types of put features.
1.QUALITY AND MATURITY. Pursuant to procedures adopted by the Board of
Trustees, the funds 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 or SP-1), and second tier
securities are those deemed to be in the second highest rating category
(e.g., Standard & Poor's A-2 or SP-2). Split-rated securities may be
determined to be either first or second tier based on applicable
regulations.
A fund may not invest more than 5% of its total assets in second tier
securities. In addition, a fund 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.
A fund 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 fund may look to an interest rate reset or demand feature.
REPURCHASE AGREEMENTS. In a repurchase agreement, a fund purchases a
security and simultaneously commits to sell that security back to the
original seller at an agreed-upon price. The resale price reflects the
purchase price plus an agreed-upon incremental amount which is unrelated to
the coupon rate or maturity of the purchased security. The securities
purchased by a fund are used to collateralize the repurchase obligation. As
such, they are held in an account of the fund at a bank, marked-to-market
daily, and maintained at a value at least equal to the sale price plus the
accrued incremental amount. While it does not presently appear possible
to eliminate all risks from these transactions (particularly the
possibility that the value of the underlying security will be less than the
resale price, as well as delays and costs to a fund in connection with
bankruptcy proceedings), it is each fund's current policy to engage in
repurchase agreement transactions with parties 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 fund 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 fund might obtain a
less favorable price than prevailed when it decided to seek registration of
the security. However, in general, each fund anticipates holding restricted
securities to maturity or selling them in an exempt transaction.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a fund
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, the fund will maintain appropriate liquid assets in a
segregated custodial account to cover its obligation under the agreement. A
fund will enter into reverse repurchase agreements only with parties whose
creditworthiness has been found satisfactory by FMR. Such transactions may
increase fluctuations in the market value of the fund's assets and may be
viewed as a form of leverage.
SECURITIES LENDING. A fund may lend securities to parties such as
broker-dealers or institutional investors, including Fidelity Brokerage
Services, Inc. (FBSI). FBSI is a member of the New York Stock Exchange and
a subsidiary of FMR Corp.
Securities lending allows a fund to retain ownership of the securities
loaned and, at the same time, to earn additional income. Since there may be
delays in the recovery of loaned securities, or even a loss of rights in
collateral supplied should the borrower fail financially, loans will be
made only to parties deemed by FMR to be of good standing. Furthermore,
they will only be made if, in FMR's judgment, the consideration to be
earned from such loans would justify the risk.
FMR understands that it is the current view of the SEC Staff that a fund
may engage in loan transactions only under the following conditions: (1)
the fund must receive 100% collateral in the form of cash or cash
equivalents (e.g., U.S. Treasury bills or notes) from the borrower; (2) the
borrower must increase the collateral whenever the market value of the
securities loaned (determined on a daily basis) rises above the value of
the collateral; (3) after giving notice, the fund must be able to terminate
the loan at any time; (4) the fund must receive reasonable interest on the
loan or a flat fee from the borrower, as well as amounts equivalent to any
dividends, interest, or other distributions on the securities loaned and to
any increase in market value; (5) the fund may pay only reasonable
custodian fees in connection with the loan; and (6) the Board of Trustees
must be able to vote proxies on the securities loaned, either by
terminating the loan or by entering into an alternative arrangement with
the borrower.
Cash received through loan transactions may be invested in any security in
which a fund is authorized to invest. Investing this cash subjects that
investment, as well as the security loaned, to market forces (i.e., capital
appreciation or depreciation).
SHORT SALES "AGAINST THE BOX." A fund may sell securities short when it
owns or has the right to obtain securities equivalent in kind and
amount to the securities sold short. Short sales could be used to protect
the net asset value per share of the fund in anticipation of increased
interest rates, without sacrificing the current yield of the securities
sold short. If a fund 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 fund will incur transaction costs, including
interest expenses, in connection with opening, maintaining, and closing
short sales against the box.
SOURCES OF CREDIT OR LIQUIDITY SUPPORT. FMR may rely on its evaluation
of the credit of a bank or another entity in determining whether to
purchase a security supported by a letter of credit guarantee, insurance or
other source of credit or liquidity. In evaluating the credit of a foreign
bank or other foreign entities, FMR will consider whether adequate public
information about the entity is available and whether the entity may be
subject to unfavorable political or economic developments, currency
controls, or other government restrictions that might affect its ability to
honor its commitment.
STRIPPED GOVERNMENT SECURITIES. Stripped securities are created by
separating the income and principal components of a debt instrument and
selling them separately. U.S. Treasury STRIPS (Separate Trading of
Registered Interest and Principal of Securities), 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 government
agencies may also be stripped in this fashion.
Privately stripped government securities 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
government agencies may also be stripped in this fashion.
Because of the SEC's views on privately stripped government securities,
a fund must evaluate them as it would non-government securities
pursuant to regulatory guidelines applicable to all money market funds.
A fund currently 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, have 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 on the security. 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.
ZERO COUPON BONDS do not make regular interest payments. Instead, they are
sold at a deep discount from their face value and are redeemed at face
value when they mature. Because zero coupon bonds do not pay current
income, their prices can be very volatile when interest rates change. In
calculating its daily dividend, a fund takes into account as income a
portion of the difference between a zero coupon bond's purchase price and
its face value.
SHAREHOLDER NOTICE. Treasury, under normal conditions, invests at least
65% of its total assets in U.S. Treasury bills, notes and bond, and
repurchase agreements backed by those obligations. The balance of its
assets may be invested in other direct obligations of the United States.
These operating policies may be changed upon 90 days' notice to
shareholders.
Treasury II, under normal conditions, invests 100% of its total assets in
U.S. Treasury bills, notes and bonds and other direct obligations of the
U.S. Treasury. The fund may also engage in repurchase agreements backed by
those obligations. These operating policies may be changed upon 90 days'
notice to shareholders.
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are
placed on behalf of each fund by FMR pursuant to authority contained in
each fund's 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 fund 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 funds may execute portfolio transactions with broker-dealers who
provide research and execution services to the funds 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; and the
availability of securities or the purchasers or sellers of securities .
In addition, such broker-dealers may furnish analyses and reports
concerning issuers, industries, securities, economic factors and trends,
portfolio strategy and performance of accounts; effect securities
transactions , and perform 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 funds 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 funds may be useful to FMR in rendering investment management
services to the funds 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 funds. 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
funds 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
funds 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 funds or shares of other
Fidelity funds to the extent permitted by law. FMR may use research
services provided by and place agency transactions with FBSI and
Fidelity Brokerage Services (FBS), subsidiaries of FMR Corp., if the
commissions are fair, reasonable, and comparable to commissions charged by
nonaffiliated, qualified brokerage firms for similar services. From
September 1992 through December 1994, FBS operated under the name Fidelity
Brokerage Services Limited, Inc. (FBSL). As of January 1995, FBSL was
converted to an unlimited liability company and assumed the name FBS. Prior
to September 4, 1992, FBSL operated under the name Fidelity Portfolio
Services, Ltd. (FPSL) as a wholly owned subsidiary of Fidelity
International Limited (FIL). Edward C. Johnson 3d is Chairman of FIL. Mr.
Johnson 3d, Johnson family members, and various trusts for the benefit of
the Johnson family own, directly or indirectly, more than 25% of the voting
common stock of FIL.
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 fund transactions on national securities
exchanges in accordance with approved procedures and applicable SEC rules.
Each fund's Trustees periodically review FMR's performance of its
responsibilities in connection with the placement of portfolio
transactions on behalf of the funds and review the commissions paid by each
fund over representative periods of time to determine if they are
reasonable in relation to the benefits to the funds.
For the fiscal years ended March 31, 1995, 1994, and 1993, the funds paid
no brokerage commissions.
From time to time, the Trustees will review whether the recapture for the
benefit of the funds of some portion of the brokerage commissions or
similar fees paid by the funds on portfolio transactions is legally
permissible and advisable. Each fund seeks to recapture soliciting
broker-dealer fees on the tender of fund 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 fund to seek such
recapture.
Although the Trustees and officers of each fund are substantially the same
as those of other funds managed by FMR, investment decisions for each fund
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 and accounts
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 fund. In
some cases this system could have a detrimental effect on the price or
value of the security as far as each fund is concerned. In other cases,
however, the ability of the funds to participate in volume transactions
will produce better executions and prices for the funds. It is the current
opinion of the Trustees that the desirability of retaining FMR as
investment adviser to each fund outweighs any disadvantages that may be
said to exist from exposure to simultaneous transactions.
VALUATION
Each fund 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 fund would receive if it sold the
instrument.
Valuing each fund'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 funds must adhere to certain conditions under Rule 2a-7;
these conditions are summarized on page .
The Board of Trustees oversees FMR's adherence to SEC rules
concerning money market funds, and has established procedures designed to
stabilize each fund'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 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. Such corrective action could include
selling fund 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, each fund's yield based on
amortized cost may be higher than the yield based on market valuations.
Under these circumstances, a shareholder in a fund would be able to obtain
a somewhat higher yield than would result if a fund utilized market
valuations to determine its NAV. The converse would apply in a period of
rising interest rates.
PERFORMANCE
The funds may quote performance in various ways. All performance
information supplied by the funds in advertising is historical and is not
intended to indicate future returns. Y ield and total return
fluctuate in response to market conditions and other factors.
YIELD CALCULATIONS. To compute a fund's yield for a period, 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. The net change is then divided by the value of the account at the
beginning of the period to obtain a base period return. This base
period return is annualized to obtain a current annualized yield. A n
effective yield may also be calculated by compounding the base
period return over a one-year period. In addition to the current yield, the
funds may quote yields in advertising based on any historical seven-day
period. Yields are calculated on the same basis as other money
market funds, as required by applicable regulations.
Yield information may be useful in reviewing a class's performance
and in providing a basis for comparison with other investment alternatives.
However, each class's yield fluctuates, unlike investments that pay
a fixed interest rate over a stated period of time. When comparing
investment alternatives, investors should also note the quality and
maturity of the portfolio securities of respective investment
companies they have chosen to consider.
Investors should recognize that in periods of declining interest rates a
class's yield will tend to be somewhat higher than prevailing market
rates, and in periods of rising interest rates a class's yield will
tend to be somewhat lower. Also, when interest rates are falling, the
inflow of net new money to a fund from the continuous sale of its shares
will likely be invested in instruments producing lower yields than the
balance of a fund's holdings, thereby reducing a class's current
yield. In periods of rising interest rates, the opposite can be expected to
occur.
T ax-equivalent yield is the rate an investor would have to earn from
a fully taxable investment after taxes to equal the fund's tax-free yield.
Tax-equivalent yields are calculated by dividing a yield by the
result of one minus a stated federal or combined federal and state tax
rate. If any portion of the yield is tax-exempt, only that portion
is adjusted in the calculation.
The following table shows the effect of a shareholder's tax status on
effective yield under federal income tax laws for 1995. It shows the
approximate yield a taxable security must provide at various income
brackets to produce after-tax yields equivalent to those of hypothetical
tax-exempt obligations yielding from 2.00% to 8.00%. Of course, no
assurance can be given that a fund will achieve any specific tax-exempt
yield. While Tax-Exempt invests principally in obligations whose interest
is exempt from federal income tax, other income received by the fund may be
taxable.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1995 TAX RATES AND TAX-EQUIVALENT YIELDS
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Federal If individual tax-exempt yield is:
Income
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Tax 2.00% 3.00% 4.00% 5.00% 6.00% 7.00% 8.00%
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
<C> <C>
Single Return* Joint Return* Bracket** Then taxable equivalent yield is:
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 23,351 - $ 36,001 - 28.0% 2.78% 4.17% 5.56% 6.94% 8.33% 9.72% 11.11%
$ 56,500 $ 94,250
$ 56,551 - $ 94,251 - 31.0% 2.90% 4.35% 5.80% 7.25% 8.70% 10.14% 11.59%
$117,950 $143,600
$117,951 - $143,601 - 36.0% 3.13% 4.69% 6.25% 7.81% 9.38% 10.94% 12.50%
$256,500 $256,500
$256,501 - $256,501 39.6% 3.31% 4.97% 6.62% 8.28% 9.93% 11.59% 13.25%
</TABLE>
* Net amount subject to federal income tax after deductions and
exemptions. Assumes ordinary income only.
** Excludes the impact of the phaseout of personal exemptions, limitations
on itemized deductions, and other credits, exclusions, and adjustments
which may increase a taxpayer's marginal tax rate. An increase in a
shareholder's marginal tax rate would increase that shareholder's
tax-equivalent yield.
Tax-Exempt may invest a portion of its assets in obligations that are
subject to state or federal income taxes. When the fund invests in these
obligations, its tax-equivalent yield will be lower. In the table above,
the tax-equivalent yields are calculated assuming investments are 100%
federally and state tax-free.
TOTAL RETURN CALCULATIONS. Total returns quoted in advertising reflect all
aspects of a class's return, including the effect of reinvesting
dividends and capital gain distributions, and any change in class's
NAV over a stated period. Average annual total returns are calculated by
determining the growth or decline in value of a hypothetical historical
investment over a stated period, and then calculating the annually
compounded percentage rate that would have produced the same result if the
rate of growth or decline in value had been constant over the period. For
example, a cumulative total return of 100% over ten years would produce an
average annual return of 7.18%, which is the steady annual rate of return
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 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 class .
In addition to average annual total returns, a class may quote
unaveraged or cumulative total returns reflecting the simple change in
value of an investment over a stated period. Average annual and cumulative
total returns may be quoted as a percentage or as a dollar amount,
and may be calculated for a single investment, a series of investments, or
a series of redemptions, over any time period. Total returns may be broken
down into their components of income and capital (including capital gains
and changes in share price) in order to illustrate the relationship of
these factors and their contributions to total return. Total returns may be
quoted on a before-tax or after-tax basis. Total returns, yields, and other
performance information may be quoted numerically or in a table, graph, or
similar illustration.
HISTORICAL RESULTS. The following tables show each fund's Class A
7-day yields, as well as Tax-Exempt's Class A tax-equivalent
yields, and Class A total returns for the period ended March 31,
1995.
Tax-Exempt's Class A tax-equivalent yield is based on a 36 %
federal income tax rate.
Average Annual Total Returns Cumulative Total Returns
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C>
Seven-Day Tax One Five Life of One Five Life of
Yield Equivalent Year Years Fund* Year Years Fund*
Yield
Treasury
5.98% N/A 4.79% 4.93% 6.18% 4.79% 27.23% 75.55%
- Class A
Treasury
5.98% N/A 4.78% 4.90% 6.03% 4.78% 27.03% 61.24%
II - Class
A
Governm
6.01% N/A 4.86% 4.99% 6.32% 4.86% 27.60% 81.07%
ent -
Class A
Domestic
6.06% N/A 4.97% 5.03% 5.31% 4.97% 27.81% 32.32%
- Class A
Money
6.07% N/A 4.99% 5.09% 6.43% 4.99% 28.15% 83.60%
Market -
Class A
Treasury
5.80% N/A 4.65% N/A 4.45% 4.65% N/A 21.65%
Only -
Class A
Tax-Exem
3.94% 6.16% 3.18% 3.65% 4.41% 3.18% 19.61% 51.86%
pt - Class
A
</TABLE>
* Life of Fund figures are from commencement of operations of each fund.
Commencement of operations for each fund are as follows: Domestic -
November 3, 19 89; Government - July 25, 19 85; Money Market -
July 3, 19 85; Treasury - November 1, 19 85; Treasury II -
February 2, 19 87; Treasury Only - October 3, 19 90; and
Tax-Exempt - July 25, 19 85.
Note: If FMR had not reimbursed certain fund expenses during these periods,
the total returns would have been lower and the yields for Class
A of each fund would have been:
Fund Yield
Treasury - Class A 5.92%
Treasury II - Class A 5.91%
Government - Class A 5.95%
Domestic - Class A 5.97%
Money Market - Class A 6.01%
Treasury Only - Class A 5.58%
Tax-Exempt - Class A 3.86%
The following tables show the income and capital elements of each fund's
Class A cumulative total return. The tables compare each fund's Class A
return to the record of the Standard & Poor's Composite Index of 500 Stocks
(S&P 500), the Dow Jones Industrial Average (DJIA), and the cost of living
(measured by the Consumer Price Index, or CPI) over the same period. The
CPI information is as of the month end closest to the initial investment
date for each fund. The S&P 500 and DJIA comparisons are provided to show
how each class's total return compared to the record of a broad average of
common stocks and a narrower set of stocks of major industrial companies,
respectively, over the same period. Of course, since each fund invests in
short-term fixed-income securities, common stocks represent a different
type of investment from the fund. Common stocks generally offer greater
growth potential than the funds, but generally experience greater price
volatility, which means greater potential for loss. In addition, common
stocks generally provide lower income than fixed-income investments, such
as the funds. Figures for the S&P 500 and DJIA are based on the prices of
unmanaged groups of stocks and, unlike the funds' returns, do not include
the effect of paying brokerage commissions or other costs of investing.
TREASURY
HISTORICAL FUND RESULTS
During the period from November 9, 1985 through March 31, 1995, a
hypothetical investment of $10,000 in Class A of the fund would have grown
to $17,555 assuming all dividends were reinvested. This was a period of
fluctuating interest rates and the figures below should not be considered
representative of the dividend income or capital gain or loss that could be
realized from an investment in Class A of the fund today.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Period Ended Value of Value of Value of Total S&P 500 DJIA Cost of
3/31 Initial Reinvested Reinvested Value Living**
$10,000 Dividends Capital Gain
Investment Distributions
1986* $ 10,000 $ 302 $ 0 $ 10,302 $ 12,516 $ 13,138 $ 10,009
1987 10,000 957 0 10,957 15,797 17,230 10,313
1988 10,000 1,686 0 11,686 14,482 15,351 10,718
1989 10,000 2,641 0 12,641 17,110 18,357 11,251
1990 10,000 3,798 0 13,798 20,408 22,502 11,840
1991 10,000 4,886 0 14,886 23,346 25,158 12,420
1992 10,000 5,702 0 15,702 25,927 28,822 12,815
1993 10,000 6,253 0 16,253 29,882 31,525 13,211
1994 10,000 6,753 0 16,753 30,323 34,307 13,542
1995 10,000 7,555 0 17,555 35,041 40,304 13,928
</TABLE>
* From November 9, 1985 (commencement of operations).
** From month end closest to Initial Investment Date.
Explanatory Notes: With an initial investment of $10,000 made on November
9, 1985, the net amount invested in Class A shares of the fund was $10,000.
The cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends for the period covered (that is, their cash
value at the time they were reinvested) amounted to $17,555. If
distributions had not been reinvested, the amount of distributions earned
from Class A shares of the fund over time would have been smaller and the
cash payments (dividends) for the period would have come to $5,643. The
fund did not distribute any capital gains during the period. Tax
consequences of different investments have not been factored into the above
figures.
TREASURY II
HISTORICAL FUND RESULTS
During the period from February 2, 1987 through March 31, 1995, a
hypothetical investment of $10,000 in Class A of the fund would have grown
to $16,124 assuming all dividends were reinvested. This was a period of
fluctuating interest rates and the figures below should not be considered
representative of the dividend income or capital gain or loss that could be
realized from an investment in Class A of the fund today.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Period Ended Value of Value of Value of Total S&P 500 DJIA Cost of
3/31 Initial Reinvested Reinvested Value Living**
$10,000 Dividends Capital Gain
Investment Distributions
1987* $ 10,000 $ 93 $ 0 $ 10,093 $ 10,694 $ 10,731 $ 10,081
1988 10,000 759 0 10,759 9,804 9,560 10,477
1989 10,000 1,632 0 11,632 11,583 11,432 10,998
1990 10,000 2,693 0 12,693 13,816 14,014 11,574
1991 10,000 3,692 0 13,692 15,805 15,668 12,140
1992 10,000 4,433 0 14,433 17,552 17,950 12,527
1993 10,000 4,932 0 14,932 20,229 19,633 12,914
1994 10,000 5,389 0 15,389 20,528 21,366 13,237
1995 10,000 6,124 0 16,124 23,722 25,101 13,615
</TABLE>
* From February 2, 1987 (commencement of operations).
** From month end closest to Initial Investment Date.
Explanatory Notes: With an initial investment of $10,000 made on February
2, 1987, the net amount invested in Class A shares of the fund was $10,000.
The cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends for the period covered (that is, their cash
value at the time they were reinvested) amounted to $16,124. If
distributions had not been reinvested, the amount of distributions earned
from Class A shares of the fund over time would have been smaller and the
cash payments (dividends) for the period would have come to $4,790. The
fund did not distribute any capital gains during the period. Tax
consequences of different investments have not been factored into the above
figures.
GOVERNMENT
HISTORICAL FUND RESULTS
During the period from July 25, 1985 through March 31, 1995, a hypothetical
investment of $10,000 in Class A of the fund would have grown to $18,107
assuming all dividends were reinvested. This was a period of fluctuating
interest rates and the figures below should not be considered
representative of the dividend income or capital gain or loss that could be
realized from an investment in Class A of the fund today.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Period Ended Value of Value of Value of Total S&P 500 DJIA Cost of
3/31 Initial Reinvested Reinvested Value Living**
$10,000 Dividends Capital Gain
Investment Distributions
1986* $ 10,000 $ 547 $ 0 $ 10,547 $ 12,812 $ 13,855 $ 10,093
1987 10,000 1,233 0 11,233 16,170 18,170 10,399
1988 10,000 2,017 0 12,017 14,824 16,188 10,807
1989 10,000 3,001 0 13,001 17,514 19,358 11,345
1990 10,000 4,191 0 14,191 20,890 23,729 11,939
1991 10,000 5,318 0 15,318 23,897 26,530 12,523
1992 10,000 6,167 0 16,167 26,540 30,395 12,922
1993 10,000 6,743 0 16,743 30,588 33,245 13,321
1994 10,000 7,267 0 17,267 31,039 36,179 13,655
1995 10,000 8,107 0 18,107 35,869 42,502 14,045
</TABLE>
* From July 25, 1985 (commencement of operations).
** From month end closest to Initial Investment Date.
Explanatory Notes: With an initial investment of $10,000 made on July 25,
1985, the net amount invested in Class A shares of the fund was $10,000.
The cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends for the period covered (that is, their cash
value at the time they were reinvested) amounted to $18,107. If
distributions had not been reinvested, the amount of distributions earned
from Class A shares of the fund over time would have been smaller and the
cash payments (dividends) for the period would have come to $5,954. The
fund did not distribute any capital gains during the period. Tax
consequences of different investments have not been factored into the above
figures.
DOMESTIC
HISTORICAL FUND RESULTS
During the period from November 3, 1989 through March 31, 1995, a
hypothetical investment of $10,000 in Class A of the fund would have grown
to $13,232 assuming all dividends were reinvested. This was a period of
fluctuating interest rates and the figures below should not be considered
representative of the dividend income or capital gain or loss that could be
realized from an investment in Class A of the fund today.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Period Ended Value of Value of Value of Total S&P 500 DJIA Cost of
3/31 Initial Reinvested Reinvested Value Living**
$10,000 Dividend Capital Gain
Investment Distributions
1990* $ 10,000 $ 352 $ 0 $ 10,352 $ 10,189 $ 10,451 $ 10,247
1991 10,000 1,192 0 11,192 11,655 11,685 10,748
1992 10,000 1,808 0 11,808 12,944 13,387 11,091
1993 10,000 2,222 0 12,222 14,919 14,642 11,433
1994 10,000 2,605 0 12,605 15,139 15,935 11,720
1995 10,000 3,232 0 13,232 17,494 18,720 12,054
</TABLE>
* From November 3, 1989 (commencement of operations).
** From month end closest to Initial Investment Date.
Explanatory Notes: With an initial investment of $10,000 made on November
3, 1989, the net amount invested in Class A shares of the fund was
$10,000 . The cost of the initial investment ($10,000) together with the
aggregate cost of reinvested dividends for the period covered (that is,
their cash value at the time they were reinvested) amounted to $13,232 .
If distributions had not been reinvested, the amount of distributions
earned from Class A shares of the fund over time would have been smaller
and the cash payments (dividends) for the period would have come to $2,807
. The fund did not distribute any capital gains during the period. Tax
consequences of different investments have not been factored into the above
figures.
MONEY MARKET
HISTORICAL FUND RESULTS
During the period from July 5 , 1985 through March 31, 1995, a
hypothetical investment of $10,000 in Class A of the fund would have
grown to $ 18,360 assuming all dividends were reinvested. This was a
period of fluctuating interest rates and the figures below should not be
considered representative of the dividend income or capital gain or loss
that could be realized from an investment in Class A of the fund today.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Period Ended Value of Value of Value of Total S&P 500 DJIA Cost of
3/31 Initial Reinvested Reinvested Value Living**
$10,000 Dividends Capital Gain
Investment Distributions
1986* $ 10,000 $ 601 $ 0 $ 10,601 $ 12,848 $ 14,126 $ 10,112
1987 10,000 1,297 0 11,297 16,217 18,525 10,418
1988 10,000 2,103 0 12,103 14,867 16,504 10,827
1989 10,000 3,113 0 13,113 17,564 19,736 11,366
1990 10,000 4,327 0 14,327 20,950 24,192 11,961
1991 10,000 5,492 0 15,492 23,965 27,048 12,546
1992 10,000 6,358 0 16,358 26,615 30,988 12,946
1993 10,000 6,945 0 16,945 30,675 33,894 13,346
1994 10,000 7,486 0 17,486 31,128 36,885 13,680
1995 10,000 8,360 0 18,360 35,971 43,332 14,071
</TABLE>
* From July 5 , 1985 (commencement of operations).
** From month end closest to Initial Investment Date.
Explanatory Notes: With an initial investment of $10,000 made on July 5 ,
1985, the net amount invested in Class A shares of the fund was $ 10,000
. The cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends for the period covered (that is, their cash
value at the time they were reinvested) amounted to $ 18,360 . If
distributions had not been reinvested, the amount of distributions earned
from Class A shares of the fund over time would have been smaller and the
cash payments (dividends) for the period would have come to $ 6,093 . The
fund did not distribute any capital gains during the period. Tax
consequences of different investments have not been factored into the above
figures.
TREASURY ONLY
HISTORICAL FUND RESULTS
During the period from October 3, 1990 through March 31, 1995, a
hypothetical investment of $10,000 in Class A of the fund would have
grown to $ 18,183 assuming all dividends were reinvested. This was a
period of fluctuating interest rates and the figures below should not be
considered representative of the dividend income or capital gain or loss
that could be realized from an investment in Class A of the fund today.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Period Ended Value of Value of Value of Total S&P 500 DJIA Cost of
7/31 Initial Reinvested Reinvested Value Living**
$10,000 Dividends Capital Gain
Investment Distributions
1991* $ 10,000 $ 353 $ 0 $ 10,353 $ 12,114 $ 11,848 $ 10,173
1992 10,000 913 0 10,913 13,454 13,573 10,497
1993 10,000 1,285 0 11,285 15,506 14,846 10,821
1994 10,000 1,624 0 11,624 15,735 16,157 11,093
1995+ 10,000 2,165 0 12,165 18,183 18,980 11,409
</TABLE>
* From October 3, 1990 (commencement of operations).
** From month end closest to Initial Investment Date.
+ Figures are for the fiscal period August 1, 1994 to March 31, 1995.
(Annualized)
Explanatory Notes: With an initial investment of $10,000 made on October 3,
1990, the net amount invested in Class A shares of the fund was $ 10,000
. The cost of the initial investment ($10,000) together with the aggregate
cost of reinvested dividends for the period covered (that is, their cash
value at the time they were reinvested) amounted to $ 12,165 . If
distributions had not been reinvested, the amount of distributions earned
from Class A shares of the fund over time would have been smaller and the
cash payments (dividends) for the period would have come to $ 1,963 . The
fund did not distribute any capital gains during the period. Tax
consequences of different investments have not been factored into the above
figures.
TAX-EXEMPT
HISTORICAL FUND RESULTS
During the period from July 25, 1985 through March 31, 1995, a hypothetical
investment of $10,000 in Class A of the fund would have grown to $ 15,186
assuming all dividends were reinvested. This was a period of fluctuating
interest rates and the figures below should not be considered
representative of the dividend income or capital gain or loss that could be
realized from an investment in Class A of the fund today.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Period Ended Value of Value of Value of Total S&P 500 DJIA Cost of
5/31 Initial Reinvested Reinvested Value Living**
$10,000 Dividends Capital Gain
Investment Distributions
1986* $ 10,000 $ 368 $ 0 $ 10,368 $ 12,812 $ 13,855 $ 10,093
1987 10,000 814 0 10,814 16,170 18,170 10,399
1988 10,000 1,323 0 11,323 14,824 16,188 10,807
1989 10,000 1,958 0 11,958 17,514 19,358 11,345
1990 10,000 2,697 0 12,697 20,890 23,729 11,939
1991 10,000 3,411 0 13,411 23,897 26,530 12,523
1992 10,000 3,973 0 13,973 26,540 30,395 12,922
1993 10,000 4,369 0 14,369 30,588 33,245 13,321
1994 10,000 4,718 0 14,718 31,039 36,179 13,655
1995+ 10,000 5,186 0 15,186 35,869 42,502 14,045
</TABLE>
* From July 25, 1985 (commencement of operations)
** From month end closest to Initial Investment Date.
+ Figures are for the fiscal period June 1, 1994 to March 31, 1995.
(Annualized)
Explanatory Notes: With an initial investment of $10,000 made on July 25,
1985, the net amount invested in Class A shares of the fund was
$1 0 ,000. The cost of the initial investment ($10,000) together with
the aggregate cost of reinvested dividends for the period covered (that is,
their cash value at the time they were reinvested) amounted to $15,186. If
distributions had not been reinvested, the amount of distributions earned
from Class A shares of the fund over time would have been smaller
and the cash payments (dividends) for the period would have come to $4,186.
The fund did not distribute any capital gains during the period. Tax
consequences of different investments have not been factored into the above
figures.
PERFORMANCE COMPARISONS. A fund'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 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 funds based on
yield. In addition to the mutual fund rankings, a fund's performance may be
compared to stock, bond, and money market mutual fund performance indices
prepared by Lipper or other organizations. When comparing these indices, it
is important to remember the risk and return characteristics of each type
of investment. For example, while stock mutual funds may offer higher
potential returns, they also carry the highest degree of share price
volatility. Likewise, money market funds may offer greater stability of
principal, but generally do not offer the higher potential returns
available from stock mutual funds.
From time to time, a fund's performance may also be compared to other
mutual funds tracked by financial or business publications and periodicals.
For example, the fund 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. 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.
A fund may be compared in advertising to Certificates of Deposit (CDs) or
other investments issued by banks or other depository institutions. Mutual
funds differ from bank investments in several respects. For example, a fund
may offer greater liquidity or higher potential returns than CDs, a fund
does not guarantee your principal or your return, and fund shares are not
FDIC insured.
Fidelity may provide information designed to help individuals understand
their investment goals and explore various financial strategies. Such
information may include information about current economic, market, and
political conditions; materials that describe general principles of
investing, such as asset allocation, diversification, risk tolerance, and
goal setting; questionnaires designed to help create a personal financial
profile; worksheets used to assess savings needs based on assumed rates of
inflation and hypothetical rates of return; and action plans offering
investment alternatives. Materials may also include discussions of
Fidelity's asset allocation funds and other Fidelity funds, products, and
services.
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.
A fund may compare its performance or the performance of securities in
which it may invest to averages published by IBC USA (Publications), Inc.
of Ashland, Massachusetts. These averages assume reinvestment of
distributions. The IBC/Donoghue's MONEY FUND AVERAGES(trademark), which is
reported in the MONEY FUND REPORT(registered trademark), covers over
695 money market funds and 210 U.S. Government Money Market
Funds .
In advertising materials, Fidelity may reference or discuss its products
and services, which may include the following : other Fidelity funds;
retirement investing; brokerage products and services; model portfolios
or allocations; the effects of periodic investment plans and dollar
cost averaging; saving for college or other goals; charitable giving; and
the Fidelity credit card. In addition, Fidelity may quote or reprint
financial or business publications and periodicals as they relate to
current economic and political conditions, fund management, fund
composition, investment philosophy, investment techniques, the desirability
of owning a particular mutual fund, and Fidelity services and products.
Fidelity may also reprint, and use as advertising and sales literature,
articles from Fidelity Focus, a quarterly magazine provided free of charge
to Fidelity fund shareholders.
A fund may present its fund number, Quotron(trademark) number, and CUSIP
number, and discuss or quote its current fund manager.
As of April 30, 1995, FMR advised over $ 25 billion in tax-free fund
assets, $ 70 billion in money market fund assets, $ 175 billion
in equity fund assets, $ 42 billion in international fund assets, and
$ 21 billion in Spartan fund assets. The funds may reference the
growth and variety of money market mutual funds and the adviser's
innovation and participation in the industry. The equity funds under
management figure represents the largest amount of equity fund assets under
management by a mutual fund investment adviser in the United States, making
FMR America's leading equity (stock) fund manager. FMR, its subsidiaries,
and affiliates maintain a worldwide information and communications network
for the purpose of researching and managing investments abroad.
In addition to performance rankings, each fund may compare its total
expense ratio to the average total expense ratio of similar funds tracked
by Lipper. A fund's total expense ratio is a significant factor in
comparing bond and money market investments because of its effect on yield.
ADDITIONAL PURCHASE, EXCHANGE 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 class'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 fund is required to give
shareholders at least 60 days' notice prior to terminating or modifying its
exchange privilege. Under the Rule, the 60-day notification requirement may
be waived if (i) the only effect of a modification would be to reduce or
eliminate an administrative fee, redemption fee, or deferred sales charge
ordinarily payable at the time of an exchange, or (ii) a fund suspends the
redemption of the shares to be exchanged as permitted under the 1940 Act or
the rules and regulations thereunder, or a 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.
In the prospectus, each fund has notified shareholders that it reserves the
right at any time, without prior notice, to refuse exchange purchases by
any person or group if, in FMR's judgment, a fund would be unable to invest
effectively in accordance with its investment objective and policies, or
would otherwise potentially be adversely affected.
DISTRIBUTIONS AND TAXES
DIVIDENDS. Because each fund's income is primarily derived from interest,
dividends from the fund generally will not qualify for the
dividends-received deduction available to corporate shareholders.
Short-term capital gains are distributed as dividend income, but do not
qualify for the dividends received deduction. A portion of each fund's
dividends derived from certain U.S. Government obligations may be exempt
from state and local taxation.
To the extent that each fund's income is designated as federally tax-exempt
interest, the daily dividends declared by the fund are also federally
tax-exempt. Short-term capital gains are distributed as dividend income,
but do not qualify for the dividends-received deduction. These gains will
be taxed as ordinary income. Each fund will send each shareholder a
notice in January describing the tax status of dividend and capital gain
distributions (if any) for the prior year.
Shareholders are required to report tax-exempt income on their federal tax
returns. Shareholders who earn other income, such as social security
benefits, may be subject to federal income tax on up to 85% of such
benefits to the extent that their income, including tax-exempt income,
exceeds certain base amounts.
Tax-Exempt purchases municipal obligations based on opinions of bond
counsel regarding the federal income tax status of the obligations. These
opinions generally will be based on covenants by the issuers or other
parties regarding continuing compliance with federal tax requirements.
If , at any time, the covenants are not complied with,
distribution to shareholders of interest on a security could
become federally taxable retroactive to the date a security was
issued. For certain types of structured securities, opinions of counsel
may also be based on the effort of the structure on the federal tax
treatment of the income.
As a result of the Tax Reform Act of 1986, interest on certain "private
activity" securities is subject to the federal alternative minimum tax
(AMT), although the interest continues to be excludable from gross income
for other tax purposes. Interest from private activity securities will be
considered tax-exempt for purposes of the fund's policy on investing so
that at least 80% of its income is free from federal income tax. Interest
from private activity securities is a tax preference item for the purposes
of determining whether a taxpayer is subject to the AMT and the the amount
of AMT to be paid, if any. Private activity securities issued after August
7, 1986 to benefit a private or industrial user or to finance a private
facility are affected by this rule.
A portion of the gain on bonds purchased with market discount after April
30, 1993 and short-term capital gains distributed by the fund are taxable
to shareholders as dividends, not as capital gains. Dividend distributions
resulting from a recharacterization of gain form the sale of bonds
purchased with market discount after April 30, 1993 are not considered
income for the purposes of Tax-Exempt's policy of investing so that
at least 80% of its income is free from federal income tax. The fund may
distribute any net realized short-term capital gains and taxable market
discounts once a year or more often, as necessary, to maintain its net
asset value at $1.00 per share.
Corporate investors should note that a tax preference item for the purposes
of the corporate AMT is 75% of the amount by which adjusted current
earnings (which includes tax-exempt interest) exceeds the alternative
minimum taxable income of the corporation. If a shareholder receives an
exempt-interest dividend and sells shares at a loss after holding them for
a period of six months or less, the loss will be disallowed to the extent
of the amount of the exempt-interest dividend.
CAPITAL GAIN DISTRIBUTIONS. Each fund may distribute any net realized
short-term capital gains once a year or more often as necessary, to
maintain its net asset value at $1.00 per share. Each fund does not
anticipate earning long-term capital gains on securities held by the
fund .
STATE AND LOCAL TAX ISSUES. For mutual funds organized as business trusts,
most state's 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 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
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 a 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 dividends from a
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.
In a number of states, corporate franchise (income) tax laws do not exempt
interest earned on U.S. Government securities whether such securities are
held directly or through a fund.
FOREIGN TAXES. Foreign governments may withhold taxes on dividends and
interest paid with respect to foreign securities. Foreign governments may
also impose taxes on other payments or gains with respect to foreign
securities. Because a fund does not currently anticipate that securities
of foreign issuers will constitute more than 50% of its total
assets at the end of the fiscal year shareholders should not expect to
claim a foreign tax credit or deduction on their federal income tax returns
with respect to foreign taxes withheld.
TAX STATUS OF THE FUNDS. Each fund intends to qualify each year as a
"regulated investment company" for tax purposes so that it will not be
liable for federal tax on income and capital gains distributed to
shareholders. In order to qualify as a regulated investment company and
avoid being subject to federal income or excise taxes at the fund level,
each fund intends to distribute substantially all of its net investment
income and net realized capital gains within each calendar year as well as
on a fiscal year basis.
FMR may determine some restricted securities and municipal lease
obligations to be illiquid.
OTHER TAX INFORMATION. The information above is only a summary of some of
the tax consequences generally affecting each fund and its shareholders,
and no attempt has been made to discuss individual tax consequences. In
addition to federal income taxes, shareholders may be subject to state and
local taxes on fund distributions, and shares may be subject to state and
local personal property taxes. Investors should consult their tax advisers
to determine whether a fund is suitable to their particular tax situation.
FMR
All of the stock of FMR is owned by FMR Corp., its parent company organized
in 1972. Through ownership of voting common stock and the execution of a
shareholders' voting agreement, Edward C. Johnson 3d, Johnson family
members, and various trusts for the benefit of the Johnson family form a
controlling group with respect to FMR Corp.
At present, the principal operating activities of FMR Corp. are those
conducted by three of its divisions as follows: Fidelity Service Co. (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 funds 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 funds' conversion to a Delaware business trust
served the Massachusetts business trust in identical capacities. 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, 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 the funds or FMR are indicated by an asterisk (*).
*EDWARD C. JOHNSON 3d (64), 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., Fidelity Management & Research (U.K.) Inc., and Fidelity
Management & Research (Far East) Inc.
*J. GARY BURKHEAD (53), Trustee and Senior Vice President, is President of
FMR; and President and a Director of FMR Texas Inc., Fidelity Management &
Research (U.K.) Inc., and Fidelity Management & Research (Far East) Inc.
RALPH F. COX (62), 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 (63), 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 she 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 of Vermont School of
Business Administration.
RICHARD J. FLYNN (71), 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 Trustee of College of the Holy Cross and Old Sturbridge
Village, Inc. , and he previously served as a director of Mechanics Bank
(1971-1995).
E. BRADLEY JONES (67), 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. He is a Director of TRW Inc.
(original equipment and replacement products), Cleveland-Cliffs Inc
(mining), Consolidated Rail Corporation, Birmingham Steel
Corporation, and RPM, Inc. (manufacturer of chemical products,
1990) and he previously served as a director of NACCO Industries, Inc.
(mining and marketing, 1985-1995) and Hyster-Yale Materials Handling, Inc.
(1985-1995). In addition, he serves as a Trustee of First Union Real
Estate Investments, a Trustee and member of the Executive Committee of the
Cleveland Clinic Foundation, a Trustee and member of the Executive
Committee of University School (Cleveland), and a Trustee of Cleveland
Clinic Florida.
DONALD J. KIRK (62), One Harborside, 680 Steamboat Road, Greenwich, CT,
Trustee, is Executive-in-Residence (1995) at Columbia University Graduate
School of Business and a financial consultant. From 1987 to January 1995,
Mr. Kirk was a Professor at Columbia University Graduate School of
Business. Prior to 1987, he was Chairman of the Financial Accounting
Standards Board. Mr. Kirk is a Director of General Re Corporation
(reinsurance) , and he previously served as a Director of
Valuation Research Corp. (appraisals and valuations, 1993 -1995 ). In
addition, he serves as Vice Chairman of the Board of Directors of the
National Arts Stabilization Fund, Vice Chairman of the Board of Trustees of
the Greenwich Hospital Association, and as a Member of the Public Oversight
Board of the American Institute of Certified Public Accountants' SEC
Practice Section (1995).
*PETER S. LYNCH (52), Trustee (1990) is Vice Chairman and Director of FMR
(1992). Prior to May 31, 1990, he was a Director of FMR and Executive Vice
President of FMR (a position he held until March 31, 1991); Vice President
of Fidelity Magellan Fund and FMR Growth Group Leader; and Managing
Director of FMR Corp. Mr. Lynch was also Vice President of Fidelity
Investments Corporate Services (1991-1992). He is a Director of W.R. Grace
& Co. (chemicals) and Morrison Knudsen Corporation (engineering and
construction). In addition, he serves as a Trustee of Boston College,
Massachusetts Eye & Ear Infirmary, Historic Deerfield 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 (65), 135 Aspenwood Drive, Cleveland, OH, Trustee, 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),
Commercial Intertech Corp. (water treatment equipment, 1992), and
Associated Estates Realty Corporation (a real estate investment trust,
1993).
EDWARD H. MALONE (70), 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 (71), 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 (66), 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., and AppleSouth, Inc. (restaurants, 1992).
FRED L. HENNING, JR.(55), Vice President (1994), is Vice President of
Fidelity's money market funds and Senior Vice President of FMR Texas Inc.
LELAND BARRON (36), Vice President (1989) is also Vice President of other
funds advised by FMR and an employee of FMR Texas Inc.
BURNELL STEHMAN (63), Vice President (1992), is also Vice President of
other funds advised by FMR and an employee of FMR Texas Inc.
JOHN TODD (46), Vice President (1992), is also Vice President of other
funds advised by FMR and an employee of FMR Texas Inc.
SARAH H. ZENOBLE (46), Vice President (1988), is also Vice President FMR
Texas and of other funds advised by FMR and an employee of FMR.
ARTHUR S. LORING (47), Secretary, is Senior Vice President (1993) and
General Counsel of FMR, Vice President-Legal of FMR Corp., and Vice
President and Clerk of FDC.
STEPHEN P. JONAS (42), Treasurer (1995), is Treasurer and Vice President of
FMR (1993). Mr. Jonas is also Treasurer of FMR Texas Inc. (1994), Fidelity
Management & Research (U.K.) Inc. (1994), and Fidelity Management &
Research (Far East) Inc. (1994). Prior to becoming Treasurer of FMR, Mr.
Jonas was Senior Vice President, Finance - Fidelity Brokerage Services,
Inc. (1991-1992) and Senior Vice President, Strategic Business Systems -
Fidelity Investments Retail Marketing Company (1989-1991).
THOMAS D. MAHER (50), 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). Prior to 1990, Mr. Maher was an
employee of FMR.
MICHAEL D. CONWAY (41), Assistant Treasurer (1995), is Assistant Treasurer
of Fidelity's money market funds and is an employee of FMR (1995). Before
joining FMR, Mr. Conway was an employee of Waddell & Reed Inc. (investment
advisor, 1986-1994), where he served as Assistant Treasurer (1992) and as
Assistant Vice President and Director of Operations of Waddell & Reed Asset
Management Company (1994).
JOHN H. COSTELLO (48), Assistant Treasurer, is an employee of FMR.
LEONARD M. RUSH (49), Assistant Treasurer (1994), is an employee of FMR
(1994). Prior to becoming Assistant Treasurer of the Fidelity funds, Mr.
Rush was Chief Compliance Officer of FMR Corp. (1993-1994); Chief Financial
Officer of Fidelity Brokerage Services, Inc. (1990-1993); and Vice
President, Assistant Controller, and Director of the Accounting Department
- - First Boston Corp. (1986-1990).
The following table sets forth information describing the compensation of
each current Trustee of each fund for his or her services as trustee for
the fiscal year ended March 31, 1995.
COMPENSATION TABLE
Aggregate Compensation
<TABLE>
<CAPTION>
<S>
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
J. Gary Ralph F. Phyllis Richard E. Edward C. Donald Peter S. Edward Marvin Gerald C. Thomas
Burkhead Cox Burke J. Flynn Bradley Johnson, J. Kirk Lynch* H. L. Mann McDonough R.
* Davis Jones 3d* Malone Williams
Trea
$ 0 $ 670 $ 641 $ 823 $ 662 $ 0 $ 683 $ 0 $ 691 $ 655 $ 684 $ 676
sury
Trea
0 2,082 1,985 2,568 2,059 0 2,811 0 2,134 2,032 2,112 2,084
sury
II
Gov
0 1,672 1,600 2,059 1,654 0 1,706 0 2,908 1,632 1,708 1,683
ernm
ent+
Dom
0 464 440 575 459 0 468 0 472 452 467 460
estic
Mon
0 2,371 2,246 2,942 2,345 0 2,395 0 2,416 2,312 2,395 2,360
ey
Mar
ket+
Trea
0 555 529 683 548 0 562 0 568 542 563 555
sury
Only
Tax-
0 1,152 1,100 1,417 1,138 0 1,169 0 1,185 1,127 1,169 1,160
Exe
mpt
</TABLE>
* Interested trustees of each fund are compensated by FMR.
+ Estimated.
Pension or Estimated Annual Total
Retirement Benefits Upon Compensation
Benefits Accrued Retirement from from the Fund
as Part of Fund the Fund Complex*
Expenses from the Complex*
Fund Complex*
J. $ 0 $ 0 $ 0
Gary
Burkh
ead**
Ralph 5,200 52,000 125,000
F. Cox
Phylli 5,200 52,000 122,000
s
Burke
Davis
Richar 0 52,000 154,500
d J.
Flynn
E. 5,200 49,400 123,500
Bradle
y
Jones
Edwar 0 0 0
d C.
Johnso
n 3d**
Donal 5,200 52,000 125,000
d J.
Kirk
Peter 0 0 0
S.
Lynch
**
Edwar 5,200 44,200 128,000
d H.
Malon
e
Marvi 5,200 52,000 125,000
n L.
Mann
Gerald 5,200 52,000 125,000
C.
McDo
nough
Thom 5,200 52,000 126,500
as R.
Willia
ms
* Information is as of December 31, 1994 for 206 funds in the
complex.
** Interested trustees of each fund are compensated by FMR.
Under a retirement program adopted in July 1988, the non-interested
Trustees, upon reaching age 72, become eligible to participate in a
retirement program under which they receive payments during their lifetime
from a fund based on their basic trustee fees and length of service. The
obligation of a fund to make such payments are not secured or funded.
Trustees become eligible if, at the time of retirement, they have served on
the Board for at least five years. Currently, Messrs. Ralph S. Saul,
William R. Spaulding, Bertram H. Witham, and David L. Yunich, all former
non-interested Trustees, receive retirement benefits under the program.
As of March 31, 1995, the Trustees and officers of each fund owned, in
the aggregate, 0% of each fund's total outstanding shares.
MANAGEMENT CONTRACTS
Each fund employs FMR to furnish investment advisory and other services.
Under its management contract with each fund, FMR acts as investment
adviser and, subject to the supervision of the Board of Trustees, directs
the investments of each fund in accordance with its investment objective,
policies, and limitations. FMR also provides each fund with all necessary
office facilities and personnel for servicing each fund's investments,
compensates all officers of each fund, all Trustees who are "interested
persons" of the trusts or of FMR, and all personnel of each fund or FMR for
performing services relating to research, statistical and investment
activities.
In addition, FMR or its affiliates, subject to the supervision of the Board
of Trustees, provide the management and administrative services necessary
for the operation of each fund. These services include providing facilities
for maintaining each fund's organization; supervising relations with
custodians, transfer and pricing agents, accountants, underwriters, and
other persons dealing with each fund; preparing all general shareholder
communications and conducting shareholder relations; maintaining each
fund's records and the registration of each fund's shares under federal and
state laws; developing management and shareholder services for each fund;
and furnishing reports, evaluations and analyses on a variety of subjects
to the Trustees.
In addition to the management fee payable to FMR and the fees payable to
FIIOC, FSC, and UMB, each fund pays all of its expenses, without
limitation, that are not assumed by those parties. Each fund pays for the
typesetting, printing, and mailing of its proxy materials to shareholders,
legal expenses, and the fees of the custodian, auditor and non-interested
Trustees. Although each fund's current management contract provides that
each fund will pay for typesetting, printing, and mailing prospectuses,
statements of additional information, notices and reports to shareholders,
the Trust, on behalf of each fund has entered into a revised transfer agent
agreement with FIIOC and UMB, as applicable, pursuant to which FIIOC or UMB
bears the costs of providing these services to existing shareholders. Other
expenses paid by each fund include interest, taxes, brokerage commissions,
each fund's proportionate share of insurance premiums and Investment
Company Institute dues, and the costs of registering shares under federal
and state securities laws. Each fund is also liable for such non-recurring
expenses as may arise, including costs of any litigation to which each fund
may be a party, and any obligation it may have to indemnify its officers
and Trustees with respect to litigation.
FMR is each fund's manager pursuant to a management contracts dated May
30, 1993 for the FICP funds; January 29, 1992 for Tax-Exempt; and September
30, 1993 for Treasury Only , which were approved by shareholders on
November 18, 1992, November 13, 1991 and March 24, 1993 ,
respectively.
For the services of FMR under each contract, each fund , except Treasury
Only, pays FMR a monthly management fee at the annual rate of
.20 % of average net assets throughout the month. Treasury Only
pays FMR a monthly management fee of .42% of average net assets. Fees
received by FMR for the last three fiscal years are shown in the table
below.
Fund Fiscal Year Ended Management Fees Paid to FMR
Treasu 1995 $ 2,645,934
ry
1994 3,796,042
1993 5,351,147
Treasu 1995 8,680,344
ry II
1994 9,834,025
1993 14,029,197
Gover 1995 6,680,088
nment
1994 9,660,519
1993 12,610,880
Dome 1995 1,923,368
stic
1994 1,525,574
1993 1,536,740
Mone 1995 10,436,518
y
Marke
t
1994 10,551,990
1993 10,066,276
Treasu 1995 3,283,265
ry
Only
1994 4,716,697
1993 4,892,175
Tax-E 1995 3,789,731
xempt
1994 5,099,831
1993 5,036,875
FMR may, from time to time, voluntarily reimburse all or a portion of each
fund's operating expenses (exclusive of interest, taxes, brokerage
commissions, and extraordinary expenses). FMR retains the ability to be
repaid for these expense reimbursements in the amount that expenses fall
below the limit prior to the end of the fiscal year. Expense reimbursements
by FMR will increase each fund's total returns and yield and repayment of
the reimbursement by each fund will lower its total returns and yield.
During the fiscal periods reported, FMR voluntarily agreed to reimburse
certain funds to the extent that the fund's aggregate operating expenses
were in excess of an annual rate of its average net assets. The table below
identifies the funds in reimbursement; the level at which reimbursement
began; and the dollar amount reimbursed for each period.
Fund Level at Which Dollar Amount Reimbursed
Reimbursement Began
1995 1994 1993
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Treasu .20 $ 822,285 $ 903,610 $ 1,246,151
ry
Treasu .20 3,539,319 2,956,802 3,246,298
ry II
Gover .20 1,936,406 2,665,587 3,508,338
nment
Dome .20 866,856 638,552 645,507
stic
Mone .18 3,002,430 2,444,993 2,697,402
y
Marke
t
Treasu .20 1,719,806 2,474,345 2,567,107
ry
Only
Tax-E .20 1,429,650 1,643,561 1,591,107
xempt
</TABLE>
To comply with the California Code of Regulations, FMR will reimburse each
fund if and to the extent that fund's aggregate annual operating
expenses exceed specified percentages of its average net assets. The
applicable percentages are 2 1/2% of the first $30 million, 2% of the next
$70 million, and 1 1/2% of average net assets in excess of $100 million.
When calculating each fund's expenses for purposes of this regulation, each
fund may exclude interest, taxes, brokerage commissions, and extraordinary
expenses, as well as a portion of its distribution plan expense s and
custodian fees attributable to investment in foreign securities.
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 fund.
Under each sub-advisory agreement dated May 30, 1993 , January 29,
1992 and September 30, 1973 , respectively, for the
FICP funds , Tax-Exempt and Treasury Only,
respectively , FMR pays FMR Texas fees equal to 50% of the management
fees payable by FMR under its current Management Contract with each
fund . 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.
The table below shows fees paid to FMR Texas for the fiscal years ended
March 31, 1995, 1994, and 1993.
1995 1994 1993
Treasu $ 1,322,967 $ 1,898,021 $ 2,675,574
ry
Treasu 4,340,172 4,917,008 7,014,599
ry II
Gover 3,340,044 4,830,260 6,305,440
nment
Dome 961,684 762.787 768,370
stic
Mone 5,218,259 5,275,995 5,033,138
y
Marke
t
Treasu 1,639,715 2,358,349 2,567,107
ry
Only
Tax-E 1,894,866 2,549,916 2,518,438
xempt
CONTRACTS WITH FMR AFFILIATES
FIIOC is transfer, dividend disbursing, and shareholder servicing agent for
Class A shares of Treasury, Treasury II, Government, Domestic, Money
Market and Treasury Only (the Taxable Funds) . UMB is the
transfer agent and shareholder servicing agent for Class A shares of
Tax-Exempt. UMB has entered into a sub-arrangement with FIIOC pursuant to
which FIIOC serves as transfer, dividend disbursing, and shareholder
servicing agent for Class A shares of Tax-Exempt. Class A of each fund pays
FIIOC o r UMB, as applicable, an annual fee and an asset-based fee
based on account size.
For accounts that FIIOC maintains on behalf of UMB, FIIOC receives all such
fees.
FIIOC pays out-of-pocket expenses associated with providing transfer agent
services. In addition, FIIOC bears the expense of typesetting, printing,
and mailing prospectuses, statements of additional information, and all
other reports, notices, and statements to shareholders, with the exception
of proxy statements.
FSC performs the calculations necessary to determine NAV and
dividends for the Class A shares of each Taxable Fund, maintains each
Taxable Fund's accounting records ' and administers each Taxable
Fund's securities lending program. UMB has sub-arrangements with FSC
pursuant to which FSC performs the calculations necessary to determine the
NAV and dividends for Class A shares of Tax-Exempt , and maintains
the accounting records for Tax-Exempt . The fee rates for pricing and
bookkeeping services are based on each fund'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. Pricing and bookkeeping fees, including related out-of-pocket
expenses, paid by the fund s for the past three fiscal years were as
follows:
Pricing and Bookkeeping Fees
1995 1994 1993
Treasu $ 149,193 $ 192,236 $ 251,607
ry
Treasu 375,762 419,147 576,072
ry II
Gover 331,070 412,411 523,696
nment
Dome 122,139 107,464 108,548
stic
Mone 441,370 445,362 429,428
y
Marke
t
Treasu N/A N/A N/A
ry
Only
Tax-E 309,306* 304,324 325,195
xempt
* Annualized
FSC also receives fees for administering the Taxable Funds' securities
lending program. Securities lending fees are based on the number and
duration of individual securities loans. For the past three fiscal
years, the funds incurred no securities lending fees.
Each fund has a distribution agreement with FDC, a Massachusetts
corporation organized on July 18, 1960. FDC is a broker-dealer registered
under the Securities Exchange Act of 1934 and is a member of the National
Association of Securities Dealers, Inc. The distribution agreement calls
for FDC to use all reasonable efforts, consistent with its other business,
to secure purchasers for shares of each fund, which are continuously
offered at net asset value. Promotional and administrative expenses in
connection with the offer and sale of shares are paid by FMR.
DISTRIBUTION AND SERVICE PLANS
The Trustees have approved a Distribution and Service Plan on
behalf of Class A of each fund (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 a fund except pursuant to a plan approved on behalf of the fund
under the Rule. The Plans, as approved by the Trustees, allow Class A of
the funds and FMR to incur certain expenses that might be considered to
constitute indirect payment by the funds of distribution expenses.
Under each Plan, if the payment of management fees by the funds to FMR is
deemed to be indirect financing by the funds of the distribution of their
shares, such payment is authorized by the Plans. Each Plan also
specifically recognizes that FMR, either directly or through FDC, may use
its management fee revenue, past profits, or other resources, without
limitation, to pay promotional and administrative expenses in connection
with the offer and sale of shares of the applicable class of each fund. In
addition, each Plan provides that FMR may use its resources, including its
management fee revenues, to make payments to third parties that assist in
selling shares of the applicable class of each fund, or to third parties,
including banks, that render shareholder support services.
The Trustees have not authorized such payments to date.
Prior to approving each Plan, the Trustees carefully considered all
pertinent factors relating to the implementation of each Plan, and have
determined that there is a reasonable likelihood that the Plan will benefit
the applicable class of each fund and its shareholders. In particular, the
Trustees noted that each Plan does not authorize payments by Class A of
each fund other than those made to FMR under its management contract with
the fund. To the extent that each Plan gives FMR and FDC greater
flexibility in connection with the distribution of shares of the applicable
class of each fund, additional sales of fund shares may result.
Furthermore, certain shareholder support services may be provided more
effectively under the Plans by local entities with whom shareholders have
other relationships.
The Plans were approved by shareholders of Class A of FICP on November
18 , 199 2 , Fidelity Institutional Tax-Exempt Cash Portfolios:
Tax-Exempt on November 31 , 199 1 , and Daily Money Fund:
Treasury Only on March 24 , 199 3 . Each Plan was
approved by shareholders, in connection with the corresponding
reorganization transactions which took place on May 30, 1993 for the
FICP funds; January 29, 1992 for Tax-Exempt; and September 29, 1993 for
Treasury Only , pursuant to Agreements and Plans of Conversion.
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 funds
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 other financial institutions may be required
to register as dealers pursuant to state law.
Each fund may execute portfolio transactions with, and purchase securities
issued by, depository institutions that receive payments under the Plans.
No preference for the instruments of such depository institutions will be
shown in the selection of investments.
DESCRIPTION OF THE TRUSTS
TRUST ORGANIZATION. Treasury, Treasury II, Government, Domestic and Money
Market are funds of Fidelity Institutional Cash Portfolios, an open-end
management investment company organized as a Delaware business Trust on May
30, 1993. The funds acquired all of the assets of the corresponding
funds of Fidelity Institutional Cash Portfolios, a Massachusetts business
trust, respectively, on May 30, 1993 . Currently, there
are five funds of Fidelity Institutional Cash Portfolios: Treasury,
Treasury II, Government, Domestic, and Money Market. The Trust Instrument
permits the Trustees to create additional funds.
Tax-Exempt is a fund of Fidelity Institutional Tax-Exempt Cash Portfolios,
an open-end management investment company organized as a Delaware business
Trust on January 29, 1992. The fund acquired all of the assets of
Fidelity Institutional Tax-Exempt Cash Portfolio the Massachusetts
trust of Fidelity Institutional Tax-Exempt Cash Portfolios on January
29, 1992 . Currently, there is one fund of Fidelity Institutional
Tax-Exempt Cash Portfolio: Tax-Exempt. The Trust Instrument permits the
Trustees to create additional funds.
Treasury Only is a fund of Daily Money Fund, an open-end management
investment company organized as a Delaware business Trust on September 30,
1993. The fund acquired all of the assets of U.S. Treasury Income
Portfolio of the Massachusetts trust of Daily Money Fund on January
29, 1993 . The Trust Instrument permits the Trustees to create
additional funds.
In the event that FMR ceases to be the investment adviser to the funds, the
right of the Trust or fund to use the identifying name "Fidelity" may be
withdrawn. There is a remote possibility that one fund might become liable
for any misstatement in its prospectus or statement of additional
information about another fund.
The assets of the Trust received for the issue or sale of shares of each
fund and all income, earnings, profits, and proceeds thereof, subject only
to the rights of creditors, are especially allocated to such fund, and
constitute the underlying assets of such fund. The underlying assets of
each fund are segregated on the books of account, and are to be charged
with the liabilities with respect to such fund 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 funds, 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 fund, or which are general or allocable to all of the funds. In the
event of the dissolution or liquidation of the Trust, shareholders of each
fund are entitled to receive as a class the underlying assets of such fund
available for distribution.
SHAREHOLDER AND TRUSTEE LIABILITY. Each 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
Instruments contains an express disclaimer of shareholder liability for the
debts, liabilities, obligations, and expenses of the Trusts and requires
that a disclaimer be given in each contract entered into or executed by the
fund or the Trustees. The Trust Instruments provide for indemnification out
of each fund's property of any shareholder or former shareholder held
personally liable for the obligations of the fund. The Trust
Instrument s also provide that each fund shall, upon request, assume
the defense of any claim made against any shareholder for any act or
obligation of the fund 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 funds are unable
to meet their obligations. FMR believes that, in view of the above, the
risk of personal liability to shareholders is extremely remote.
The Trust Instruments further provide 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 fund'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 the Prospectus. Shares are fully paid and non-assessable,
except as set forth under the heading "Shareholder and Trustee Liability"
above. Shareholders representing 10% or more of a trust , fund or
class may, as set forth in each of the Trust Instruments, call meetings
of the Trust, fund , or class, for any purpose related to the
Trust, fund, or class, 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.
Any trust or fund may be terminated upon the sale of its assets to, or
merger with, another open-end management investment company or series
thereof, 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 Trust or fund; however, the Trustees may, without
prior shareholder approval, change the form or organization of the trust or
fund by merger, consolidation, or incorporation. If not so terminated, the
fund and the funds will continue indefinitely. Under the Trust Instruments,
the Trustees may, without shareholder vote, cause a 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.
As of March 31, 1995 the following owned of record or beneficially more
than 5% of the outstanding shares of each fund:
Treasury: Michigan Public funds Investment Trust, Farmington Hills, MI
(24.6%); FBS Investment Services, Inc., Minneapolis, MN (11.00%); Wachovia
Bank & Trust Company, Winston-Salem, NC (6.89%).
Treasury II: Bank of America, San Francisco, CA (18.1%); First Union
National Bank, Charlotte, NC (13.71%); Bank of New York, New York, (8.86%)
Texas Commence Bank, N.A., Houston, TX (7.86%); First Interstate Bank of
Oregon, Portland, OR (7.15%).
Government: First Tennessee Bank, Memphis, TN (12.8%); Hillsborough County,
Tampa, FL (6.58%); Texas Commerce Bank, N.A., Houston, TX (5.81%);
Pennsylvania Housing Finance Agency, Harrisburg, PA (5.1%).
Domestic: First Union National Bank, Charlotte, NC (25.34%); Texas Commerce
Bank, N.A., Houston, TX (7.94%).
Money Market: FMR Corp., Boston, MA (24.71%); Shawmut Bank of Boston, N.A.,
Boston, MA (5.47%); First Union National Bank, Charlotte, NC (5.39%).
Treasury Only: First Union National Bank, Charlotte, NC (37.85%); Shawmut
Bank of Boston, N.A., Boston, MA (10.46%); Ropes & Gray, Boston, MA
(7.17%); Allen & Company, Inc., New York, NY (5.9%).
Tax-Exempt: Shawmut Bank of Boston, N.A., Boston, MA (9.18%); Wachovia Bank
& Trust Company, Winston-Salem, NC (8.98%)
A shareholder owning of record or beneficially more than 25% of a fund's
shares outstanding shares may be considered a controlling person. Their
votes could have a more significant effect on matters presented at a
shareholders' meeting than votes of other shareholders.
CUSTODIAN. Morgan Guaranty Trust Company of New York, 60 Wall Street, New
York, NY 10260 is custodian of the assets of all funds, except Treasury II
and Tax-Exempt. Bank of New York, 48 Wall Street, New York, New
York is custodian of the assets of Treasury II . The custodian for
Tax-Exempt is UMB, 1010 Grand Avenue, Kansas City Missouri. The
custodian is responsible for the safekeeping of a fund ' s
assets and the appointment of subcustodian banks and clearing agencies. The
custodian takes no part in determining the investment policies of a
fund or in deciding which securities are purchased or sold by a
fund. H owever, a fund may invest in obligations of the
custodian and may purchase securities from or sell securities to the
custodian. Chemical Bank, headquartered in New York, may also serve as a
special purpose custodian of certain assets in connection with pooled
repurchase agreement transactions.
FMR, its officers and directors and its affiliated companies and the funds'
Trustees may, from time to time, have transactions with various banks,
including banks serving as custodians for certain 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. Coopers and Lybrand L.L.P. , 1999 Bryan St. Suite 3000,
Dallas, TX 75201 serves as the independent accountant for
Tax-Exempt and Treasury Only . Price Waterhouse, LLP ,
2001 Ross Avenue, Suite 1800, Dallas, TX 75201 serves as the
independent accountant for the FICP funds . The auditor s
examines financial statements for the fund s and provides other
audit, tax, and related services.
FINANCIAL STATEMENTS
Each fund's financial statements and financial highlights for the fiscal
year ended March 31, 1995 are included in each fund's Annual Report, which
is a separate report attached to this SAI. Each fund's financial statements
and financial highlights are incorporated herein by reference.
APPENDIX
The descriptions that follow are examples of eligible ratings for the
funds. The funds 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:
(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 and with high internal cash generation.
(medium 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 alternative
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 only in small
degree.
<PAGE>
Fidelity Money Market Trust: U.S. Treasury Portfolio
Dear Shareholder:
On September 13, 1995, Fidelity is holding a Special Meeting for
shareholders of Fidelity Money Market Trust: U.S. Treasury Portfolio (FMMT
Treasury). The purpose of the meeting is to transfer all of the assets of
FMMT Treasury to another institutional money market fund that has the same
investment objectives and policies as FMMT Treasury. After the transfer,
institutional investors will continue to enjoy the benefits of a U.S.
Treasury money market fund, and will reduce expenses by more than half,
from .42% down to .20%. The transfer will afford investors the additional
benefits of a larger investment portfolio. The cost of the transfer will
be borne exclusively by Fidelity. Accordingly, the Trustees recommend you
approve the transfer.
At this important meeting, shareholders are being asked to consider and
approve an Agreement and Plan of Reorganization (the Agreement) between
FMMT Treasury and Fidelity Institutional Cash Portfolios: Treasury II
(Treasury II), (the Reorganization). The terms of the proposed
Reorganization provide for the transfer of substantially all of the assets
of FMMT Treasury to Treasury II in exchange for Class A Shares of Treasury
II. Following such transfer, FMMT Treasury will be liquidated and Class A
Shares of Treasury II will be distributed to shareholders of FMMT Treasury
in exchange for their FMMT Treasury shares. Each shareholder will receive
the number and value of Treasury II Class A Shares equal to the number and
value of such shareholder's shares in FMMT Treasury.
Treasury II, like FMMT Treasury, is a money market fund that seeks a high
level of current income by investing in securities issued by the U.S.
Treasury. Enclosed is a Proxy Statement further describing the reasons
for the Reorganization and a Prospectus describing in detail the
investment objective and policies of Treasury II.
Fidelity Management & Research Company, FMMT Treasury's adviser,
anticipates approval of the Reorganization will result in lower fund
operating expenses.
FMMT Treasury 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 Treasury for
Class A Shares of Treasury II therefore will not result in the recognition
of any taxable gain or loss to the shareholders of FMMT Treasury on the
date of the transaction.
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
<PAGE>
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 2692
MMTRE-PXL-895
<PAGE>
Fidelity Institutional Cash Portfolios: U.S. Treasury Portfolio
Dear Shareholder:
On September 13, 1995, Fidelity is holding a Special Meeting for
shareholders of Fidelity Institutional Cash Portfolios: U.S. Treasury
Portfolio (FICP Treasury). The purpose of the meeting is to transfer all
of the assets of FICP Treasury to another Fidelity institutional money
market fund that has substantially similar investment objectives and
policies to FICP Treasury. After the combination, institutional investors
will continue to enjoy the benefits of a U.S. Treasury money market fund
and fund expenses will remain the same. The transfer will afford
investors the benefits of a larger investment portfolio. The cost of the
transfer will be borne exclusively by Fidelity. Accordingly, the Trustees
recommend you approve the transfer.
At this important meeting, shareholders are being asked to consider and
approve an Agreement and Plan of Reorganization (the Agreement) between
FICP Treasury and Fidelity Institutional Cash Portfolios: Treasury II
(Treasury II) (the Reorganization). The terms of the proposed
Reorganization provide for the transfer of substantially all of the assets
of FICP Treasury to Treasury II in exchange for Class A Shares of Treasury
II. Following such transfer, FICP Treasury will be liquidated and Class A
Shares of Treasury II will be distributed to shareholders of FICP Treasury
in exchange for their FICP Treasury shares. Each shareholder will receive
the number and value of Treasury II Class A Shares equal to the number and
value of such shareholder's shares in FICP Treasury.
Treasury II, like FICP Treasury, is a money market fund that seeks a high
level of current income by investing in securities issued by the U.S.
Treasury and repurchase agreements backed by these securities. Enclosed
is a Proxy Statement further describing the reasons for the Reorganization
and a Prospectus describing in detail the investment objectives and
policies of Treasury II.
FICP Treasury 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 FICP Treasury for
Class A Shares of Treasury II therefore will not result in the recognition
of any taxable gain or loss to the shareholders of FICP Treasury on the
date of the transaction.
The Board of Trustees of Fidelity Institutional Cash Portfolios 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
<PAGE>
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
2697
CPTRE-PXL-895
<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 INSTITUTIONAL CASH PORTFOLIOS: Treasury
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Ralph F. Cox, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: Treasury, 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 10:30 a.m. and at any adjournments thereof. All
powers may be exercised by a majority of said proxy holders or substitutes
voting or acting or, if only one votes and acts, then by that one. This
Proxy shall be voted on the proposals described in the Proxy Statement as
specified on the reverse side. Receipt of the Notice of the Meeting and
the accompanying Proxy Statement is hereby acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When
signing in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date ______________________________________, 1995
___________________________________________
___________________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
CUSIP #316175306/FUND #053
<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 Agreement and FOR [] AGAINST [] ABSTAIN [] 1.
Plan of Reorganization and
Liquidation whereby Treasury
II, a series of Fidelity
Institutional Cash Portfolios,
acquires substantially all of
the assets of FICP: Treasury,
solely in exchange for Class A
Shares of beneficial interest
in Treasury II and the
assumption by Treasury II of
FICP: Treasury's liabilities.
FICP-PXC-795 (2937) CUSIP #316175306/FUND #053
<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. Treasury Portfolio
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Ralph F. Cox, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
FIDELITY MONEY MARKET TRUST: U.S. Treasury Portfolio, 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 10:30 a.m. and at any
adjournments thereof. All powers may be exercised by a majority of said
proxy holders or substitutes voting or acting or, if only one votes and
acts, then by that one. This Proxy shall be voted on the proposal
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
CUSIP #316191501/ FUND #048
<PAGE>
Please refer to the Proxy Statement discussion of this matter.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE PROPOSALS.
---
As to any other matter, said attorneys shall vote in accordance with their
best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR THE FOLLOWING:
---
_______________________________________________________________________
_________________________________________________________________________
1. To approve an Agreement FOR [] AGAINST [] ABSTAIN [] 1.
and Plan of Reorganization
and Liquidation whereby
Treasury II, a series of
Fidelity Institutional
Cash Portfolios, acquires
substantially all of the
assets of FMMT: U.S.
Treasury Portfolio, solely
in exchange for Class A
Shares of beneficial
interest in Treasury II
and the assumption by
Treasury II of FMMT: U.S.
Treasury Portfolio's
liabilities.
FMMT-PXC-795 (2935) CUSIP # 316191501/FUND #048
<PAGE>
U.S. TREASURY PORTFOLIO
(a series of Fidelity Money Market Trust)
TREASURY
(a series of Fidelity Institutional Cash Portfolios)
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 Fidelity Money
Market Trust: U.S. Treasury Portfolio (FMMT Treasury) and Fidelity
Institutional Cash Portfolios: Treasury (FICP Treasury) will be held at
the principal executive office of Fidelity Money Market Trust and Fidelity
Institutional Cash Portfolios (each, a Trust) at 82 Devonshire Street,
Boston, Massachusetts, 02109 on September 13, 1995, at 10:30 a.m. Eastern
time. The purpose of the Meeting is as follows:
1. To approve an Agreement and Plan of
Reorganization and Liquidation (an Agreement) between FMMT
Treasury and Fidelity Institutional Cash Portfolios: Treasury II
(Treasury II), providing for the transfer of substantially all of
the assets of FMMT Treasury to Treasury II in exchange solely for
Class A Shares of beneficial interest of Treasury II and the
assumption by Treasury II of FMMT Treasury's liabilities followed
by the distribution of Class A Shares of Treasury II to
shareholders of FMMT Treasury in liquidation of FMMT Treasury.
2. To approve an Agreement and Plan of
Reorganization and Liquidation (an Agreement) between FICP
Treasury and Treasury II providing for the transfer of
substantially all of the assets of FICP Treasury to Treasury II
in exchange solely for Class A Shares of beneficial interest of
Treasury II and the assumption by Treasury II of FICP Treasury's
liabilities followed by the distribution of Class A Shares of
Treasury II to shareholders of FICP Treasury in liquidation of
FICP Treasury.
3. To transact such other business as may properly
come before the Meeting or any adjournment thereof.
Each 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.
<PAGE>
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. TREASURY PORTFOLIO
(a series of Fidelity Money Market Trust)
TREASURY
(a series of Fidelity Institutional Cash Portfolios)
82 Devonshire Street, Boston, Massachusetts, 02109
(Toll Free) 1-800-843-3001
PROXY STATEMENT
July 26, 1995
This Proxy Statement is being furnished to shareholders of U.S.
Treasury Portfolio (FMMT Treasury), a series of Fidelity Money Market
Trust (FMMT or a Trust), and Treasury (FICP Treasury), a series of
Fidelity Institutional Cash Portfolios (FICP or a Trust) in connection
with the solicitation of proxies by each Trust's Board of Trustees for use
at a Special Meeting of Shareholders of FMMT Treasury and FICP Treasury
and at any adjournment thereof (the Meeting). The Meeting will be held on
Wednesday, September 13, 1995 at 10:30 a.m. Eastern time at 82 Devonshire
Street, Boston, Massachusetts, 02109, the principal executive office of
the Trusts.
As more fully described in the Proxy Statement, the purpose of
the Meeting is to vote on two proposed reorganizations (Reorganizations).
In Reorganization 1, pursuant to an Agreement and Plan of Reorganization
and Liquidation (an Agreement), FMMT Treasury would transfer substantially
all of its assets to Treasury II, a series of FICP, in exchange solely for
Class A Shares of beneficial interest of Treasury II and the assumption by
Treasury II of FMMT Treasury's liabilities. Treasury II Class A Shares
then would be distributed to FMMT Treasury shareholders, so that each such
shareholder would receive a number of full and fractional shares of
Treasury II equal to the number of shares of FMMT Treasury held by such
shareholder. Following the distribution, FMMT Treasury will have neither
assets, liabilities, nor shareholders, and it is expected that the FMMT
Board of Trustees will liquidate FMMT Treasury as soon as practical.
In Reorganization 2, pursuant to an Agreement and Plan of
Reorganization and Liquidation (an Agreement), FICP Treasury would
transfer substantially all of its assets to Treasury II in exchange solely
for Class A Shares of beneficial interest of Treasury II and the
assumption by Treasury II of FICP Treasury's liabilities. Treasury II
Class A Shares then would be distributed to FICP Treasury shareholders, so
that each such shareholder would receive a number of full and fractional
shares of Treasury II equal to the number of shares of FICP Treasury held
by such shareholder. Following the distribution, FICP Treasury will have
neither assets, liabilities, nor shareholders, and it is expected that the
FICP Board of Trustees will liquidate FICP Treasury as soon as practical.
Treasury II, a money market fund, is a diversified portfolio of
FICP, an open-end management investment company. Treasury II's investment
objective is to obtain as high a level of current income as is consistent
with the preservation of principal and liquidity. Treasury II seeks to
<PAGE>
achieve its investment objective by investing in bills, notes, bonds, and
other direct obligations of the U.S. Treasury.
This Proxy Statement, which should be retained for future
reference, sets forth concisely the information about the Reorganizations
and Treasury II that a shareholder should know before voting on a
Reorganization. This Proxy Statement is accompanied by the Prospectus
dated July 1, 1995, which offers shares of Treasury II and FICP Treasury.
The Statement of Additional Information dated July 26, 1995 is
incorporated herein by reference. The Statement of Additional Information
for Treasury II and FICP Treasury, dated July 1, 1995, and a Prospectus
and a Statement of Additional Information for FMMT Treasury, both dated
December 24, 1994, have been filed with the Securities and Exchange
Commission (SEC) and are incorporated herein by 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. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
TABLE OF CONTENTS
Voting Information 1
Synopsis 5
Comparison of Principal Risk Factors 12
The Proposals 13
Additional Information About Treasury II 19
Miscellaneous 20
Exhibit 1 - Form of Agreement and Plan of Reorganization
and Liquidation for FMMT Treasury 21
Exhibit 2 - Form of Agreement and Plan of Reorganization
and Liquidation for FICP Treasury
<PAGE>
U.S. TREASURY PORTFOLIO
(a series of Fidelity Money Market Trust)
TREASURY
(a series of Fidelity Institutional Cash Portfolios)
82 Devonshire Street, Boston, Massachusetts 02109
PROXY STATEMENT
Special Meetings of Shareholders of
Fidelity Money Market Trust: U.S.
Treasury Portfolio
Fidelity Institutional Cash
Portfolios: Treasury
to be held on September 13, 1995
VOTING INFORMATION
This Proxy Statement is being furnished to shareholders of U.S.
Treasury Portfolio (FMMT Treasury), a series of Fidelity Money Market
Trust, (FMMT or a Trust) and Treasury (FICP Treasury), a series of
Fidelity Institutional Cash Portfolios (FICP or a Trust) (each an Acquired
Fund and collectively, the Acquired Funds), in connection with the
solicitation of proxies by the Boards of Trustees of the Trusts
(collectively the Boards), for use at a Special Meeting of Shareholders
(the Meeting) of each Acquired Fund to be held on September 13, 1995, or
at any adjournment thereof. This Proxy Statement will first be mailed to
shareholders on or about August 2, 1995.
If, with respect to either Acquired Fund, a quorum is not present
at the Meeting or a quorum is present but sufficient votes to approve a
proposal are not received, the persons named as proxies may propose one or
more adjournments of the Meeting with respect to that Acquired Fund to
permit further solicitation of proxies. Any such adjournment will require
the affirmative vote of a majority of those shares of an Acquired Fund
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 the
proposed 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 a 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
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
<PAGE>
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 applicable Agreement and Plan of Reorganization and Liquidation (each
a Reorganization Plan) attached to this Proxy Statement as Exhibits 1 and
2. Under each Reorganization Plan, Treasury II (the Acquiring Fund), a
series of FICP, would acquire substantially all of the assets of an
Acquired Fund in exchange solely for Class A Shares of beneficial interest
in Treasury II and the assumption by Treasury II of an Acquired Fund's
liabilities; those Treasury II Class A Shares then would be distributed to
that Acquired Fund's shareholders. (Each of these transactions 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 the applicable Trust 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 June 30, 1995, FMMT Treasury had 121,236,911 shares of
beneficial interest outstanding. FICP Treasury had 988,853,280 shares of
beneficial interest outstanding and Treasury II had 6,359,285,322 shares
of beneficial interest outstanding. Fidelity Management & Research Company
(FMR), the investment adviser for each Acquired Fund, will bear the cost
of proxy solicitation for FMMT Treasury. FICP Treasury will bear the cost
of its proxy solicitation to the extent that its total operating expenses
do not exceed .20% of its average net assets. The solicitation of proxies
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 such Funds.
As of June 30, 1995, the following shareholders were known by the
Trusts to own of record or beneficially the percentage of each Fund's
outstanding shares shown in the tables below.
Percent of
Outstanding Fund
Shareholder Address Shares
----------- ------- ----------------
FICP Treasury
Michigan Public Funds 27777 Inkster Rd. 27.65%
Investment Trust Farmington Hills, MI
48018
FBS Investment 1515 Arapahoe St. 11.16%
Services, Inc. Denver, CO 80202
- 2 -
<PAGE>
Percent of
Outstanding Fund
Shareholder Address Shares
----------- ------- ----------------
Bank of New York One Wall Street 8.98%
New York, NY 10286
Wachovia Bank & Trust 301 North Main St. 7.88%
Company Winston-Salem, NC
27150
FMMT Treasury
South Holland Bancorp 16178 Southpark Ave. 12.56%
South Holland, IL
60473
Owensboro National 230 Frederica St. 11.56%
Bank Owensboro, KY 42301
First National Bank 78 North Chicago St. 8.51%
of Joliet Joliet, IL 60431
Massachusetts Housing 50 Milk St. 6.27%
Finance Agency Boston, MA 02109
TREASURY II - CLASS A
SHARES
Bank of America 555 California Street 28.99%
San Francisco, CA
94104
First Union National Two First Union Center 11.94%
Bank Charlotte, NC 28288
Texas Commerce Bank, 712 Travis Street 8.60%
N.A. Houston, TX 77002
Treasury II - Class B
Shares
Bank of New York One Wall Street 43.65%
New York, NY 10286
Chemical Bank 270 Park Avenue 13.53%
New York, NY 10017
Hibernia National 313 Carombelet St. 9.75%
Bank New Orleans, LA 70130
Boatmen's Trust Co. One Boatmen's Plaza 8.19%
of St. Louis 800 Market
St. Louis, MO 63101
Southwest Bank of 4295 San Felipe 5.34%
Texas Houston, TX 77027
- 3 -
<PAGE>
To the knowledge of the Trusts, no other shareholder owned of
record or beneficially more than 5% of the outstanding shares of either
Acquired Fund or Treasury II on that date.
On June 30, 1995, Bank of America and Michigan Public Funds
Investment Trust owned of record or beneficially more than 25% of the
outstanding shares of their respective fund. A shareholder owning more
than 25% of a fund's outstanding shares is considered to be a -
controlling person" of that fund. Bank of America's controlling position
in Treasury II and Michigan Public Funds Investment Trust's controlling
position in FICP Treasury mean that their votes could have a more
significant effect on matters presented to shareholders than the vote of
other fund shareholders.
Trustees and officers of each Acquired Fund and of Treasury II
own in the aggregate less than 1% of the shares of their respective Fund.
Shareholders of FMMT Treasury are entitled to one vote for each dollar of
net asset value of the Fund they own. Shareholders of FICP Treasury and
Treasury II are entitled to one vote for each full share they own and a
proportionate share of one vote for each fractional share they own.
Summarized below are the proposals the shareholders of each
Acquired Fund are being asked to consider:
Fund Proposals
---- ---------
FMMT Treasury 1. To approve an Agreement and Plan of
Reorganization and Liquidation under which Treasury II
would acquire substantially all of the assets of FMMT
Treasury in exchange solely for Class A Shares of
beneficial interest in Treasury II and the assumption
by Treasury II of FMMT Treasury's liabilities followed
by the distribution of Treasury II Class A Shares to
the shareholders of FMMT Treasury.
FICP Treasury 2. To approve an Agreement and Plan of
Reorganization and Liquidation under which Treasury II
would acquire substantially all of the assets of FICP
Treasury in exchange solely for Class A Shares of
beneficial interest in Treasury II and the assumption
by Treasury II of FICP Treasury's liabilities,
followed by the distribution of Treasury II Class A
Shares to the shareholders of FICP Treasury.
For voting purposes, the shareholders of each Acquired Fund will
vote only on the Reorganization Plan applicable to their respective Fund.
Approval of a Reorganization Plan by one Acquired Fund's shareholders does
not depend on the approval of the other Reorganization Plan by the other
Acquired Fund's shareholders. In the event that only one Acquired Fund's
Shareholders approve their Reorganization Plan, Treasury II would acquire
substantially all of the assets and assume the liabilities of only that
Acquired Fund. The other Acquired Fund would remain a separate fund from
- 4 -
<PAGE>
Treasury II and continue its current operations, and its Board of Trustees
would consider alternate arrangements. Approval of a Reorganization Plan
requires the affirmative vote of a majority of the outstanding voting
securities of the applicable Acquired Fund. 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 an Acquired Fund's shares present
at a meeting of shareholders if the owners of more than 50% of that
Acquired Fund's shares then outstanding are present in person or by proxy,
or (2) more than 50% of the Acquired Fund's outstanding shares.
SYNOPSIS
The following is a summary of certain information contained
elsewhere in this Proxy Statement, in the Reorganization Plans, and in the
prospectuses of each Acquired Fund and of Treasury II. The Prospectus of
FMMT Treasury is incorporated herein by reference. Shareholders should
read the entire Proxy Statement and the prospectus of Treasury II
carefully. As discussed more fully below, the Boards believe that the
proposed Reorganizations will benefit the Acquired Funds' shareholders.
Treasury II has an investment objective identical to that of each Acquired
Fund. As shareholders of Treasury II, it is anticipated that each Acquired
Fund's former shareholders will be subject to the same or lower operating
expenses measured as a percentage of net assets.
The Proposed Reorganizations
Treasury II currently offers two classes of shares (each, a Class
and collectively, Classes), designated as Class A and Class B. FMMT
Treasury offers one class of shares. FICP Treasury is authorized to offer
Class A and Class B Shares, but currently offers only Class A Shares.
Each Reorganization Plan provides for the acquisition by Treasury
II of substantially all of the assets of an Acquired Fund in exchange
solely for Class A Shares of Treasury II and the assumption by Treasury II
of an Acquired Fund's liabilities. (The Acquired Funds and Treasury II are
referred to herein collectively as Funds and individually as a Fund.) Each
Acquired Fund will then distribute the Treasury II Class A Shares to its
shareholders so that each such shareholder will receive the number of full
and fractional Class A Shares of Treasury II that corresponds to the
number of Acquired Fund shares held by such shareholder as of the Closing
Date (defined below). The exchange of each Acquired Fund's assets for
Treasury II Class A Shares will occur at or as of 5:00 p.m., Eastern time,
on October 31, 1995 (the Closing Date), or on such other date as the
parties may agree. Each Acquired Fund will then be liquidated as soon as
is practicable thereafter.
The rights and privileges of the former shareholders of an
Acquired Fund will be effectively unchanged by a Reorganization, other
than as described under - Minimum Initial Investment and Account Balance,"
- Shareholder Services," - Purchases and Redemptions" and - Exchanges".
- 5 -
<PAGE>
For the reasons set forth under - The Proposals - Reasons for the
Reorganizations," the Trusts' Boards of Trustees, including the trustees
who are not - interested persons" of the Trusts as that term is defined in
the 1940 Act (Independent Trustees), have concluded that the applicable
Reorganization is in the best interests of each Acquired Fund, that the
terms of each Reorganization are fair and reasonable, and that the
interests of each Acquired Fund's shareholders will not be diluted as a
result of the proposed transactions. Accordingly, each Board recommends
approval of the transactions. In addition, FICP's Board of Trustees,
including the Independent Trustees, have concluded that the
Reorganizations are in the best interests of Treasury II, the terms of the
Reorganizations are fair and reasonable, and that the interests of
Treasury II's shareholders will not be diluted as a result of the proposed
transactions.
Expenses
The total operating expenses incurred by FICP Treasury will not
change significantly if shareholders approve the Fund's proposed
Reorganization Plan because the Fund is subject to the same voluntary
expense limitation as Treasury II. Effective July 1, 1995, FMR voluntarily
limited the total operating expenses of Class A Shares of FICP Treasury
and Treasury II to .20% of the average net assets of such class. Prior to
that date, total operating expenses were voluntarily limited to .18% of
the average net assets of the Class A Shares of each Fund. Voluntary
expense limitations may be terminated at any time and exclude interest,
taxes, brokerage commissions, extraordinary expenses, and 12b-1 fees paid
by Class B Shares. If these limitations had not been in effect, management
fees and total operating expenses for the fiscal year ended March 31, 1995
would have been .20% and .25%, respectively, for Class A Shares of
Treasury II and .20% and .24%, respectively, for Class A Shares of FICP
Treasury. (See - Comparative Fee Tables" below for more information.)
If FMMT Treasury shareholders approve the Reorganization Plan,
the total operating expenses they would bear as shareholders of Treasury
II Class A Shares would be limited to .20% of Treasury II's average net
assets because of the voluntary expense limitation currently in effect for
Class A Shares of Treasury II.
FMMT Treasury currently 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 Treasury'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.
Treasury II's management fee is not all-inclusive; the Fund pays
separately for all of its own expenses, such as transfer agency and
pricing and bookkeeping fees, and fees paid to unaffiliated parties that
provide services to the Fund. However, total operating expenses are
currently limited to .20% of its average net assets, which represents a
- 6 -
<PAGE>
reduction from FMMT Treasury's all-inclusive fee of .42%. (See -
Comparative Fee Tables" below for more information.)
Comparative Fee Tables
Reorganization of FMMT Treasury into Treasury II
The following table shows the current fees and expenses incurred
by shares of FMMT Treasury and by Class A Shares of Treasury II for the
year ended March 31, 1995, adjusted to reflect the current .20% voluntary
expense limitation in effect for Class A Shares of Treasury II. The
figures for the Combined Fund include the pro forma effect of FMMT
Treasury's Reorganization; they do not take into account the effect of
FICP Treasury's Reorganization.
Annual Fund Operating Expenses
(as a percentage of average net assets)
FMMT Treasury II Pro Forma Fees
Treasury Class A Shares Combined Fund
-------- -------------- --------------
Management Fees .42% .15% .15%
Other Expenses .00% .05% .05%
Total Fund .42% .20%* .20%*
Operating Expenses
* Net of reimbursement
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.
One Year Three Years Five Years Ten Years
-------- ----------- ---------- ---------
FMMT Treasury $4 $13 $24 $53
Treasury II $2 $6 $11 $26
Class A Shares
Combined Fund $2 $6 $11 $26
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
SEC regulations; 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
- 7 -
<PAGE>
those shown. The actual expenses attributable to each Fund will depend
upon, among other things, its level of average net assets. In addition,
the actual expenses of Treasury II 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 the total operating expenses of Treasury II's Class A
Shares to .20% of its average net assets. Prior to July 1, 1995, FMR
limited these expenses to .18% of the average net assets of Treasury II's
Class A Shares.
Reorganization of FICP Treasury into Treasury II
The following table shows the current fees and expenses incurred
by shares of FICP Treasury and by Class A Shares of Treasury II for the
fiscal year ended March 31, 1995, adjusted to reflect the current .20%
voluntary expense limitation in effect for Class A Shares of Treasury II
and FICP Treasury. The figures for the Combined Fund include the pro forma
effect of FICP Treasury's Reorganization; they do not take into account
the effect of FMMT Treasury's Reorganization.
Annual Fund Operating Expenses
(as a percentage of average net assets)
FICP Treasury II Pro Forma Fees
Treasury Class A Shares Combined Fund
-------- ------------- --------------
Management Fees .16% .15% .15%
Other Expenses .04% .05% .05%
Total Fund .20%* .20%* .20%*
Operating
Expenses
* Net of reimbursement
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.
One Year Three Years Five Years Ten Years
-------- ----------- ---------- ---------
FICP Treasury $ 2 $ 6 $ 11 $ 26
Treasury II $ 2 $ 6 $ 11 $ 26
Class A Shares
Combined Fund $ 2 $ 6 $ 11 $ 26
This Example assumes that all dividends and other distributions
are reinvested and that the percentage amounts listed under Annual Fund
- 8 -
<PAGE>
Operating Expenses remain the same in the years shown. annual return. The
above tables and the assumption in the Example of a 5% annual return are
required by SEC regulations; 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, 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
the total operating expenses of FICP Treasury's and Treasury II's Class A
Shares to .20% of their respective average net assets. Prior to July 1,
1995, FMR limited these expenses to .18% of the average net assets of each
Fund's Class A Shares.
Reorganization of FMMT Treasury and FICP Treasury into Treasury II
The following table shows the current fees and expenses incurred by shares
of FMMT Treasury, FICP Treasury, and Class A Shares of Treasury II for the
year ended March 31, 1995, adjusted to reflect the current .20% voluntary
expense limitation in effect for Class A Shares of Treasury II and FICP
Treasury. The figures for the Combined Fund include the pro forma effect
of FMMT Treasury's and FICP Treasury's respective reorganizations.
Annual Fund Operating Expenses
(as a percentage of average net assets)
Pro Forma
FMMT Treasury II Class A Fees Combined
Treasury FICP Treasury Shares Fund
-------- ------------- ------------------ ------------
Management .42% .16% .15% .15%
Fees
Other .00% .04% .05% .05%
Expenses
Total Fund .42% .20%* .20%* .20%*
Operating
Expenses
* Net of reimbursement
Example of Effect of Fund Expenses
- 9 -
<PAGE>
The following illustrates the estimated expenses on a $1,000
investment under the existing and estimated fees and the expenses stated
above, assuming a 5% annual return.
One Year Three Years Five Years Ten Years
-------- ----------- --------- ---------
FMMT Treasury $4 $ 13 $ 24 $ 53
FICP Treasury $2 $ 6 $ 11 $ 26
Treasury II Class $2 $ 6 $ 11 $ 26
A Shares
Combined Fund $2 $ 6 $ 11 $ 26
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
SEC regulations; 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,
the actual expenses of Treasury II, FICP Treasury, and the Combined Fund
will also depend on the extent to which each fund incurs variable
expenses, such as transfer agency costs and the terms of any reimbursement
arrangements with FMR. Currently, FMR limits the total operating expenses
of Treasury II's and FICP Treasury's Class A Shares to .20% of its average
net assets. Prior to July 1, 1995, FMR limited these expenses to .18% of
the average net assets of each Fund's Class A Shares.
Forms of Organization
FICP is organized as a Delaware business trust. FICP Treasury, a
series of FICP, commenced operations on November 9, 1985. Treasury II,
also a series of FICP, commenced operations on February 2, 1987. FMMT is
also organized as a Delaware business trust. FMMT Treasury, a series of
FMMT, commenced operations on April 7, 1981 and currently offers one class
of shares. FICP Treasury is authorized to offer Class A and Class B
Shares, but currently offers only Class A Shares. Treasury II 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 Treasury, Treasury II and FMMT Treasury are each series of a Delaware
business trust, organized under substantially similar trust instruments,
the rights of the security holders of the Acquired Funds under state law
and the governing documents are expected to remain unchanged after the
Reorganizations.
- 10 -
<PAGE>
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 each Acquired Fund and of Treasury II
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 Treasury invests in instruments which are issued or
guaranteed as to principal and interest by the U.S. government and
constitute direct obligations of the U.S. government, and in repurchase
agreements backed by these instruments. As a non-fundamental policy, the
Fund intends to invest 100% of its total 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.
FICP Treasury invests 65% of its total assets in U.S. Treasury
bills, notes and bonds, and in repurchase agreements backed by those
obligations. The balance of its assets may be invested in other direct
obligations of the United States.
Treasury II invests 100% of its total assets in U.S. Treasury
bills, notes and bonds, and other direct obligations of the U.S. Treasury.
The Fund may also engage in repurchase agreements backed by these
obligations.
Other Policies of the Funds. Pursuant to a current non-
fundamental investment policy, FMMT Treasury invests 100% of its total
assets in Treasury securities and repurchase agreements backed by Treasury
securities. (Non-fundamental policies may be changed without shareholder
approval.) In addition, each Fund may invest up to 10% of its net assets
in illiquid securities. In practice, FMMT Treasury and Treasury II have
invested in the same types of Treasury obligations. FICP Treasury may, in
addition, invest in certain full faith and credit obligations of the U.S.
Government that are not issued by the U.S. Treasury.
Operations of Treasury II Following the Reorganizations
FMR does not expect Treasury II to revise its investment policies
to reflect those of either Acquired Fund following the Reorganization. In
addition, FMR does not currently anticipate any significant changes to the
Fund's management or to agents that provide the Fund with services.
Minimum Initial Investment and Account Balance
- 11 -
<PAGE>
FICP Treasury and Treasury II each requires a minimum initial
investment of $1 million and a minimum account balance of $1 million.
These requirements will be unaffected by FICP Treasury's proposed
Reorganization. FMMT Treasury's minimum initial investment and minimum
account balance are each $100,000. If FMMT Treasury's proposed
Reorganization Plan is approved, former FMMT Treasury shareholders would
be subject to Treasury II's $1 million minimums. Nevertheless, Treasury II
intends to waive these requirements for FMMT Treasury accounts that, as of
the Closing Date, have balances of less than $1 million.
Shareholder Services
FICP Treasury and Treasury II offer shareholders identical and
limited services that will be unaffected by FICP Treasury's proposed
Reorganization. FMMT Treasury, however, offers its shareholders
subaccounting services, such as recordkeeping. If FMMT Treasury
shareholders approve the Fund's proposed 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 that do
not use them or to new accounts. FMMT Treasury offers certain other
services that Treasury II 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 Treasury
shareholders after that Fund's Reorganization.
Purchases and Redemptions
Shares of FMMT Treasury are normally priced at 3:00 p.m. and 4:00
p.m. Eastern time each day the Fund is open for business. Class A Shares
of FICP Treasury are normally priced at 3:00 p.m. Eastern time each day
the Fund is open for business. Class A Shares of Treasury II are priced at
3:00 p.m and 5:00 p.m. Eastern time each day the Fund is open for
business. Therefore, the Reorganizations will provide FICP Treasury
shareholders with twice-daily pricing and FMMT Treasury Shareholders with
a later second pricing.
Shares of FMMT Treasury and Class A Shares of FICP Treasury
purchased at the 3:00 p.m. price, as well as Class A Shares of Treasury II
purchased by 5:00 p.m., will begin to earn income dividends that day. FMMT
Treasury shares purchased at the 4:00 p.m. price will begin to earn
dividend income on the following business day.
Shares of each Fund may be redeemed on any business day at 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 Treasury and FICP Treasury, and by 5:00 p.m. for Treasury II
redemptions, redemption proceeds will be wired that day to the
shareholder's bank account of record and such shares will not receive that
day's dividend. Shares of FMMT Treasury 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.
- 12 -
<PAGE>
If Shareholders of an Acquired Fund approve their Reorganization
Plan, shares of the Acquired Fund will continue to be available for
purchase, including purchases through the reinvestment of dividends, by
existing shareholders through the Closing Date. Each Acquired Fund was
closed to new accounts on July 18, 1995. If a Meeting with respect to an
Acquired Fund 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 the Acquired Fund's shares and exchanges of such shares may
be effected through the Closing Date (see - Exchanges" below).
Exchanges
If an Acquired Fund's shareholders approve their Fund's
Reorganization, the Acquired Fund's shareholders would be subject to the
exchange privilege currently offered by Treasury II. This would result in
a more limited exchange privilege for FMMT Treasury shareholders. Because
FICP Treasury offers the same exchange privilege as Treasury II, the
exchange privilege available to current shareholders of FICP Treasury
would be unaffected by that Fund's proposed Reorganization.
Specifically, Class A shareholders of Treasury II and FICP
Treasury may exchange their shares only for Class A Shares of other FICP
Portfolios, for Class A Shares of Fidelity Institutional Tax-Exempt Cash
Portfolios: Tax-Exempt and for Class A Shares of Daily Money Fund:
Treasury Only. Currently, shares of FMMT Treasury may be exchanged for
shares of any other Fidelity fund registered in a shareholder's state.
Nonetheless, Treasury II shareholders may redeem their Treasury II shares
and subsequently purchase shares of any other Fidelity fund.
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 and capital gains, if any. On or before the Closing
Date, each Acquired Fund 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 each Reorganization will be tax-free.
Please see the section entitled - Federal Income Tax Considerations" for
more information.
COMPARISON OF PRINCIPAL RISK FACTORS
Because the Acquired Funds and Treasury II are money market
funds, each must comply with federal regulatory requirements applicable to
all money market funds concerning the quality and maturity of their
- 13 -
<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 accordance with applicable rules in one of
the two highest categories for short-term securities or by one, if only
one service has rated the security, or unrated securities, if FMR deems
that they are 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. In addition, each Fund seeks to maintain a stable $1.00
share price. These requirements, coupled with each Fund's emphasis on U.S.
Treasury securities and repurchase agreements backed by those securities,
mean that the Funds have substantially similar investment policies and
thus substantially similar levels of risk.
Each Fund pursues the same investment objective and follows
similar investment policies (see - Investment Objectives and Policies" on
page 10). Treasury II invests only in direct obligations of and in
repurchase agreements backed by the U.S. Treasury. FICP Treasury invests
in Treasury securities and also in other direct obligations of the United
States (government securities). Such government securities include
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. Although FMMT Treasury also may
invest in these government securities, its current non-fundamental
investment policy of investing solely in direct obligations of the U.S.
Treasury is identical to the investment policy of Treasury II.
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 PROPOSALS
1. TO APPROVE AN AGREEMENT AND PLAN OF REORGANIZATION AND
LIQUIDATION BETWEEN FMMT TREASURY AND TREASURY II.
2. TO APPROVE AN AGREEMENT AND PLAN OF REORGANIZATION AND
LIQUIDATION BETWEEN FICP TREASURY AND TREASURY II.
Reorganization Plans
The terms and conditions under which the proposed transactions
may be consummated are set forth in the Reorganization Plans. Significant
provisions of the Plans are summarized below; however, this summary is
qualified in its entirety by reference to the Plans, copies of which are
attached as Exhibits 1 and 2 to this Proxy Statement. The Reorganization
Plans proposed herein are substantially similar to each other.
- 14 -
<PAGE>
Each Plan contemplates (a) Treasury II's acquiring on the Closing
Date substantially all of the assets of FMMT Treasury and/or FICP Treasury
(each, an Acquired Fund) in exchange solely for Class A Shares of Treasury
II and the assumption by Treasury II of an Acquired Fund's liabilities and
(b) distribution of the Class A Shares of Treasury II to the shareholders
of an Acquired Fund as provided in its Reorganization Plan.
The assets of each Acquired Fund to be acquired by Treasury II
include substantially all cash, cash equivalents, securities, receivables
(including interest or dividends receivable), claims, choses in action,
and other property owned by the Acquired Fund and any deferred or prepaid
expenses shown as an asset on the books of the Acquired Fund on the
Closing Date. Treasury II will assume from an Acquired Fund all debts,
liabilities, obligations, and duties of the Acquired Fund of whatever kind
or nature; provided, however, that each Acquired Fund will use its best
efforts, to the extent practicable, to discharge all of its known debts,
liabilities, and obligations prior to the Closing Date. Treasury II also
will deliver to each Acquired Fund Class A Shares of Treasury II, which
the Acquired Fund shall then distribute to its shareholders.
The value of an Acquired Fund's assets, the amount of an Acquired
Fund's liabilities to be assumed by Treasury II and the net asset value of
a Class A Share of Treasury II will be determined as of the close of
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 Boards believe that a deviation from a Fund's
amortized cost per share may result in material dilution or other unfair
results to shareholders, the Boards 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, each Acquired Fund will
distribute pro rata to its shareholders of record Class A Shares of
Treasury II it received, so that each Acquired Fund shareholder will
receive a number of full and fractional shares of Class A Shares of
Treasury II equal to the number of full and fractional shares of the
Acquired Fund held by such shareholder on the Closing Date; each Acquired
Fund will be liquidated as soon as is practicable thereafter. Such
distribution will be accomplished by transferring Class A Shares then
credited to the account of the Acquired Fund to Treasury II, opening
accounts on the books of Treasury II in the names of Acquired Fund
shareholders, and representing the respective pro rata number of Treasury
II Class A Shares due to Acquired Fund shareholders. Fractional shares of
Treasury II will be rounded to the third decimal place.
Accordingly, immediately after each Reorganization, each former
shareholder of an Acquired Fund will own Class A Shares of Treasury II
that will be equal to the number of that shareholder's shares of the
Acquired Fund immediately prior to the Reorganization. The net asset value
- 15 -
<PAGE>
per share of Treasury II will be unchanged by the transaction. Thus, the
Reorganizations will not result in a dilution of any shareholder interest.
Any transfer taxes payable upon issuance of Class A Shares of
Treasury II in a name other than that of the registered holder of the
shares on the books of an Acquired Fund 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 an Acquired Fund will continue
to be its responsibility up to and including the Closing Date and such
later date on which such Fund is liquidated.
FMR will bear the cost of FMMT Treasury's Reorganization. FICP
Treasury will bear the cost of its Reorganization, to the extent that its
total operating expenses do not exceed .20% of the average net assets of
its Class A Shares. The cost of a Reorganization includes 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 filing registration statements.
The consummation of the Reorganizations is subject to a number of
conditions set forth in the Plans, some of which may be waived by a Fund.
In addition, the Reorganization Plans 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 Reorganizations
In considering the Reorganizations, the Boards 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 Reorganizations
relative to their current expense ratios;
(3) the tax consequences of the Reorganizations;
(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
Reorganizations.
The Boards also noted that although FMMT Treasury offers more
shareholder services and has lower minimum initial investments and account
balances than does Treasury II, it has not successfully attracted
substantial assets and only a few shareholders currently take advantage of
its sub-accounting services. In addition, FMMT Treasury's total operating
expenses are currently higher than Treasury II's expenses.
- 16 -
<PAGE>
The Boards further noted that FICP Treasury's broader investment
policies have resulted in only a minimally higher yield than Treasury II's
yield (typically less than .02%), and Treasury II has been more successful
attracting investors. The Boards of Trustees concluded that, if the
Reorganizations are approved, FMMT Treasury shareholders and FICP Treasury
shareholders could benefit from Treasury II's larger asset base, which may
result in lower expenses. Furthermore, Treasury II provides shareholders
with a higher quality portfolio and only a minimal difference in yield.
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). Treasury II is one of five series of FICP. FICP's
Trustees have authorized the public offering of three classes of shares of
Treasury II. Each share in a class represents an equal proportionate
interest in Treasury II with each other share in that class. Shares of
Treasury II 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.
On the Closing Date, Treasury II will have two classes of shares
outstanding: Class A and Class B. Only Class A Shares will be issued to
the Acquired Funds and distributed to their shareholders in the
Reorganizations. 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 Treasury II is entitled to participate equally
in dividends and other distributions and in the proceeds of any
liquidation, except that dividends of 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 an Acquired Fund's assets for Class A Shares of
Treasury II and Treasury II's assumption of liabilities of the Acquired
- 17 -
<PAGE>
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 each
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 Treasury II of substantially all of the
assets of an Acquired Fund solely in exchange for Treasury II
Class A Shares and the assumption by Treasury II of the
Acquired Fund's liabilities, followed by the distribution by an
Acquired Fund of Treasury II Class A Shares to the shareholders
of an Acquired Fund pursuant to the liquidation of an Acquired
Fund and constructively in exchange for Acquired Fund shares,
will constitute a reorganization within the meaning of section
368(a)(1)(C) of the Code, and an Acquired Fund and Treasury II
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 an Acquired Fund upon the
transfer of substantially all of its assets to Treasury II in
exchange solely for Treasury II Class A Shares and Treasury
II's assumption of an Acquired Fund's liabilities followed by
the Acquired Fund's subsequent distribution of those Class A
Shares to shareholders in liquidation of the Acquired Fund;
(iii) No gain or loss will be recognized by Treasury II upon the
receipt of the assets of an Acquired Fund in exchange solely
for Treasury II Class A Shares and its assumption of the
Acquired Fund's liabilities;
(iv) The shareholders of an Acquired Fund will recognize no gain or
loss upon the exchange of an Acquired Fund's shares solely for
Treasury II Class A Shares;
(v) The basis of an Acquired Fund's assets in the hands of Treasury
II will be the same as the basis of those assets in the hands
of an Acquired Fund immediately prior to the Reorganization,
and the holding period of those assets in the hands of Treasury
II will include the holding period of those assets in the hands
of an Acquired Fund;
(vi) The basis of an Acquired Fund's shareholders in Treasury II's
Class A Shares will be the same as their basis in the Acquired
Fund shares to be constructively surrendered in exchange
therefor; and
(vii) The holding period of Treasury II Class A Shares to be received
by an Acquired Fund's shareholders will include the period
during which an Acquired Fund's shares to be constructively
surrendered in exchange therefor were held, provided such an
- 18 -
<PAGE>
Acquired Fund's shares were held as capital assets by those
shareholders on the date of the Reorganization.
Shareholders of an Acquired Fund should consult their tax
advisers regarding the effect, if any, of the proposed Reorganizations in
light of their individual circumstances. Because the foregoing discussion
only relates to the federal income tax consequences of the
Reorganizations, those shareholders also should consult their tax advisers
as to state and local tax consequences, if any, of the Reorganizations.
Capitalization
The following tables show the capitalization of the Funds as of
March 31, 1995 (unaudited for FMMT Treasury), and on a pro forma combined
basis (unaudited) as of that date giving effect to the Reorganizations,
under three different scenarios.
If only FMMT Treasury participates in a Reorganization:
<TABLE>
<CAPTION
Net Assets Class A(1) Treasury II FMMT Treasury Pro Forma
Combined
<S> <C> <C> <C>
$ 4,688,198,169 $ 131,872,650 $ 4,820,070,819
Net Asset Value Per Share- $ 1.00 $ 1.00 $ 1.00
Class A (1)
Shares Outstanding Class A (1) 4,688,611,950 131,912,970 4,820,524,920
(1) Currently, only Treasury II offers different classes of shares. Shares of each Acquired Fund will be exchanged for
Class A Shares of Treasury II.
If only FICP Treasury participates in a Reorganization:
Treasury II FICP Treasury Pro Forma Combined
Net Assets Class A (1) $ 4,688,198,169 $ 1,197,721,467 $ 5,885,919,636
Net Asset Value Per Share- $ 1.00 $ 1.00 $ 1.00
Class A (1)
Shares Outstanding Class A (1) 4,688,611,950 1,198,225,128 5,886,837,078
</TABLE>
--------------------
(1) Currently, only Treasury II offers different classes of shares.
FICP Treasury has not commenced offering Class B Shares. Shares
of each Acquired Fund will be exchanged for Class A Shares of
Treasury II.
- 19 -
<PAGE>
If both Acquired Funds participate in the Reorganizations:
<TABLE>
<CAPTION>
FMMT Pro Forma
Treasury II Treasury FICP Treasury Combined
----------- -------- ------------- ---------
<S> <C> <C> <C> <C>
Net Assets Class A (1) $ 4,688,198,169 $ 131,872,650 $ $ 6,017,792,286
1,197,721,467
Net Asset Value Per Share $ 1.00 $ 1.00 $ 1.00 $ 1.00
Class A (1)
Shares Outstanding Class A (1) 4,688,611,950 131,912,970 1,198,225,128 6,018,750,048
</TABLE>
(1) Currently, only Treasury II offers different classes of shares.
FICP Treasury has not commenced offering Class B Shares. Shares
of each Acquired Fund will be exchanged for Class A Shares of
Treasury II.
Conclusion
Each Agreement and Plan of Reorganization and Liquidation and the
transactions provided for therein were approved by the Boards of FMMT and
FICP at meetings held on March 16, 1995. The Boards determined that the
interests of existing shareholders of FMMT Treasury, FICP Treasury, and
Treasury II would not be diluted as a result of the Reorganizations. In
the event that one or both Reorganizations are not consummated, the
applicable Acquired Fund or both Acquired Funds, as the case may be, will
continue to engage in business as a fund of a registered investment
company and the Boards will consider other proposals for the
reorganization or liquidation of one or both Acquired Funds.
- 20 -
<PAGE>
ADDITIONAL INFORMATION ABOUT TREASURY II
Financial Highlights
The table below provides condensed information concerning income
and capital changes for one Class A Share of Treasury II for the periods
shown. This information is supplemented by the financial statements and
accompanying notes appearing in Treasury II'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 table 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.
Selected Per-Share Data
<TABLE>
<CAPTION>
1987A 1988 1989 1990 1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.000$ 1.000 $1.000$1.000 $1.000$1.000$1.000$1.000 $1.000
Income from Investment Operations
Net interest income .009 .064 .078 .088 .076 .053 .034 .030 .047
Less Distributions
From net interest income (.009) (.064) (.078)(.088) (.076)(.053)(.034)(.030) (.047)
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 B .93% 6.60% 8.11% 9.13% 7.87% 5.41% 3.46% 3.06% 4.78%
Ratios and Supplemental Data
Net assets, end of period (In millions) $26 $380 $658 $1,481 $3,282$5,477$5,590$4,552 $4,688
Ratio of expenses to average net assets .20%C .20% .20% .19% .18% .18% .18% .18% .18%
Ratio of expenses to average net assets before .99%C .32% .26% .27% .25% .25% .23% .24% .25%
expense reductions
Ratio of net interest income to average net 6.11%C 6.46% 7.92% 8.63% 7.50% 5.12% 3.38% 3.01% 4.71%
assets
</TABLE>
---------------------------
A February 2, 1987 (commencement of operations) to March 31, 1987
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.
C Annualized
- 21 -
<PAGE>
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 Treasury II will be passed upon by Kirkpatrick & Lockhart LLP, counsel
to the Trusts.
Experts
The audited financial statements of Treasury II and FICP Treasury,
incorporated by reference in the Statement of Additional Information, have
been examined by Price Waterhouse LLP, independent accountants, whose
reports thereon are included in the Funds' Annual Reports to Shareholders
for the fiscal year ended March 31, 1995. The audited financial statements
of FMMT Treasury, 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 Treasury 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 an Acquired Fund, in care of Fidelity Institutional Cash
Portfolios or Fidelity Money Market Trust, as the case may be, 82
Devonshire Street, Boston, MA 02109, 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.
- 22 -
<PAGE>
EXHIBIT 1
FORM OF AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
FIDELITY MONEY MARKET TRUST: U.S. TREASURY PORTFOLIO
THIS AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION (the
Agreement) is made as of the __ day of ____, 1995 by and among U.S.
Treasury Portfolio (FMMT Treasury), a fund of Fidelity Money Market Trust
(FMMT), Treasury II, 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 Treasury in exchange solely for
Class A Shares of beneficial interest of Treasury II, and the assumption
by Treasury II of FMMT Treasury's liabilities, followed by the
constructive distribution, after the Closing Date hereinafter referred to,
of such Class A Shares of Treasury II to the shareholders of FMMT Treasury
in liquidation of FMMT Treasury 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 TREASURY
IN EXCHANGE FOR CLASS A SHARES OF TREASURY II AND LIQUIDATION OF
FMMT TREASURY
1. As of the date of this Agreement, Treasury II offers two
classes of shares, Class A and Class B and FMMT Treasury offers
one class of shares. As contemplated herein, in exchange for
substantially all of the assets of FMMT Treasury, and the
assumption by Treasury II of FMMT Treasury's liabilities,
Treasury II shall deliver Class A Shares of Treasury II to FMMT
Treasury.
2. Subject to the terms and conditions herein set forth, and
on the basis of the representations and warranties contained
herein, FMMT Treasury agrees to transfer its assets as set forth
in paragraph 1.3 to Treasury II and Treasury II agrees to assume
FMMT Treasury's liabilities described in paragraph 1.4 hereof and
deliver to FMMT Treasury in exchange therefor the number of Class
A Shares of Treasury II equal in value (calculated in the manner
and as of the time set forth in paragraph 2.2) to the net asset
value per share of FMMT Treasury (calculated in the manner and as
of the time set forth in paragraph 2.1) multiplied by the number
of shares of FMMT Treasury then outstanding.
<PAGE>
3. The assets of FMMT Treasury to be acquired by Treasury II
shall include, substantially all cash, cash equivalents,
securities, receivables (including interest or dividends
receivable), claims, choses in action and other property owned by
FMMT Treasury and any deferred or prepaid expenses shown as an
asset on the books of FMMT Treasury on the closing date provided
in Article 3 hereof (the Closing Date).
4. The liabilities to be assumed by Treasury II shall
include (except as otherwise provided herein) all of FMMT
Treasury'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 Treasury agrees to use its
best efforts to discharge all of its known liabilities prior to
the Closing Date.
5. In order for FMMT Treasury 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 Treasury
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
Treasury will liquidate and distribute pro rata to its
shareholders of record, determined as of the close of business on
the Closing Date, the Treasury II Class A Shares received by FMMT
Treasury pursuant to Article 1 in exchange for their interest in
FMMT Treasury evidenced by their shares of beneficial interest in
FMMT Treasury shares. Such liquidation and distribution will be
accomplished by the transfer of the shares then credited to the
account of FMMT Treasury on the books of Treasury II, to open
accounts on the share records of Treasury II in the names of the
FMMT Treasury shareholders and representing the respective pro
rata number of Treasury II Class A Shares due such shareholders.
Treasury II shall not issue certificates representing its shares
in connection with such exchange. Fractional shares of Treasury
II shall be rounded to the third decimal place.
7. Ownership of Treasury II Class A Shares will be shown on
the books of Treasury II's transfer agent. Treasury II Class A
Shares will be issued in the manner described in Treasury II's
current Class A Prospectus and Statement of Additional
Information.
8. Any transfer taxes payable upon the issuance of Class A
Shares of Treasury II in a name other than the registered holder
of the shares on the books of FMMT Treasury as of that time shall
- 2 -
<PAGE>
be paid by the person to whom such shares are to be issued as a
condition of such transfer.
9. Any reporting responsibility of FMMT Treasury is and
shall remain the responsibility of FMMT Treasury up to and
including the Closing Date and such later date on which FMMT
Treasury is liquidated.
2. VALUATION
1. The net asset value per share of FMMT Treasury's shares
shall be computed as of the close of business on the Closing
Date, using the valuation procedures set forth in FMMT Treasury's
then current Prospectus or Statement of Additional Information.
2. The value of Treasury II Class A Shares shall be the net
asset value per share computed as of the Closing Date using the
valuation procedures set forth in Treasury II'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 Treasury II and FMMT
Treasury.
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 as custodian for FMMT
Treasury (the Custodian), shall present portfolio securities to
The Bank of New York, N.A. (BONY), as custodian for Treasury II,
for examination and the portfolio securities and cash of FMMT
Treasury shall be delivered by the Custodian to BONY for the
account of Treasury II prior to the close of business on the
Closing Date. The Custodian shall deliver at the Closing a
certificate of an authorized officer stating that (a) FMMT
Treasury's securities, cash and other assets have been duly
endorsed in proper form for transfer in such condition as to
constitute good delivery thereof, 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, in conjunction with the delivery of
portfolio securities. The cash delivered shall be in the form of
currency or certified official bank checks, payable to the order
of BONY, custodian for Treasury II.
- 3 -
<PAGE>
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 Treasury and Treasury II 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.
4. Fidelity Investments Institutional Operations Co.
(FIIOC), as transfer agent for FMMT Treasury and Treasury II,
shall deliver at the Closing a list of the names and addresses of
FMMT Treasury's shareholders and the number and percentage
ownership of outstanding shares owned by each such shareholder of
FMMT Treasury, all as of the close of business on the Closing
Date, certified by an officer of FIIOC. Treasury II shall issue
and deliver to the Secretary or Assistant Secretary of FMMT
Treasury a confirmation evidencing the Class A Shares of Treasury
II to be credited on the Liquidation Date, or provide evidence
satisfactory to FMMT Treasury that such Class A Shares of
Treasury II have been credited to FMMT Treasury's account on the
books of Treasury II. 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 Treasury represents and warrants as follows:
A. FMMT Treasury 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 Treasury 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 Treasury, of any agreement, indenture, instrument,
contract, lease or other undertaking to which FMMT
Treasury is a party or by which FMMT Treasury is bound;
D. FMMT Treasury has no material contracts or other
commitments (other than this Agreement) which will not be
- 4 -
<PAGE>
terminated without liability to FMMT Treasury 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 Treasury threatened against FMMT
Treasury or any of its properties or assets, except as
previously disclosed in writing to Treasury II. FMMT
Treasury knows of no facts which might form the basis for
the institution of such proceedings, and FMMT Treasury 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;
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 Treasury 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 Treasury II. Such financial statements are
presented in accordance with generally accepted
accounting principles, and fairly present, in all
material respects, the financial condition of FMMT
Treasury as of such dates, and there are no material
known liabilities of FMMT Treasury at such date
(contingent or otherwise) not disclosed therein;
G. Since August 31, 1994, there has not been any
material adverse change in FMMT Treasury'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
Treasury 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 Treasury'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 period from November 9,
1985 through August 31, 1986 and for each subsequent
taxable fiscal year ended August 31 through the fiscal
year ended August 31, 1994, FMMT Treasury has met the
- 5 -
<PAGE>
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 Treasury 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 Treasury 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 Treasury II in
accordance with the provisions of paragraph 3.4 hereof.
K. At the Closing Date, FMMT Treasury will have good
and marketable title to its assets to be transferred to
Treasury II 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, Treasury II will 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 Treasury, and this Agreement constitutes a
valid and binding obligation of FMMT Treasury enforceable
in accordance with its terms, subject to shareholder
approval;
M. The information to be furnished by FMMT Treasury
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 Treasury to be
included in the registration statement filed with the
Securities and Exchange Commission by FMMT on Form N-14
relating to the Treasury II 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 Treasury's shareholders, and on the Closing Date (i)
will comply in all material respects with the provisions
- 6 -
<PAGE>
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 Treasury 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 Treasury will, from time to time, as and
when requested by Treasury II, 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 Treasury II may deem necessary or
desirable in order to vest in and confirm to Treasury II
title to and possession of all the assets of FMMT
Treasury to be sold, assigned, transferred and delivered
hereunder and otherwise to carry out the intent and
purpose of this Agreement;
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 Treasury's knowledge,
any provision of any agreement to which FMMT Treasury is
a party or by which it is bound or, to the knowledge of
FMMT Treasury, result in the acceleration of any
obligation or the imposition of any penalty under any
agreement, judgment or decree to which FMMT Treasury is a
party or by which it is bound;
R. To FMMT Treasury's knowledge, no consent,
approval, authorization or order of any court or
governmental authority is required for the consummation
by FMMT Treasury 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;
S. The fair market value of the assets of FMMT
Treasury will equal or exceed the liabilities to be
assumed by Treasury II and to which the assets are
subject; and
- 7 -
<PAGE>
T. FMMT Treasury's liabilities to be assumed by
Treasury II were incurred by FMMT Treasury in the
ordinary course of business.
2. Treasury II represents and warrants as follows:
A. Treasury II 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. Treasury II 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
Treasury II, of any agreement, indenture, instrument,
contract, lease or other undertaking to which Treasury II
is a party or by which Treasury II 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 Treasury II, threatened against Treasury II
or any of its properties or assets, except as previously
disclosed in writing to FMMT Treasury. Treasury II knows
of no facts which might form the basis for the
institution of such proceedings and Treasury II 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;
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 Treasury II at March 31, 1995 (copies of
which have been furnished to FMMT Treasury) are presented
in accordance with generally accepted accounting
principles, and fairly present, in all material respects,
the financial condition of Treasury II as of such date,
and there are no material known liabilities of Treasury
II at such date (contingent or otherwise) not disclosed
therein;
F. Since March 31, 1995, there has not been any
material adverse change in Treasury II's financial
condition, assets, liabilities or business other than
changes occurring in the ordinary course of business;
- 8 -
<PAGE>
G. At the date hereof and at the Closing Date, all
Federal and other tax returns and reports of Treasury II
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
Treasury II'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, Treasury II 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 Treasury II 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 Treasury II, and this Agreement constitutes the
valid and binding obligation of Treasury II enforceable
in accordance with its terms;
K. The Treasury II Class A Shares to be issued and
delivered to FMMT Treasury 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 Treasury II,
fully paid and non-assessable under Delaware law;
L. On the effective date of the Registration
Statement, at the time of the meeting of FMMT Treasury'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
- 9 -
<PAGE>
conformity with information furnished by FMMT Treasury
for use in the Registration Statement;
M. The information to be furnished by Treasury II
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. Treasury II 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. Treasury II will, from time to time, as and when
requested by FMMT Treasury, 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 Treasury may deem necessary
or desirable in order to vest in and confirm to FMMT
Treasury, title to and possession of all of the Treasury
II'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 Treasury II's knowledge, any
provision of any agreement to which Treasury II is a
party or by which it is bound or, to the knowledge of
Treasury II, result in the acceleration of any
obligations or the imposition of any penalty under any
agreement, judgment or decree to which Treasury II is a
party or by which it is bound; and
Q. To Treasury II's knowledge, no consent, approval,
authorization or order of any court or governmental
authority is required for the consummation by Treasury II
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.
5. COVENANTS OF TREASURY II AND FMMT TREASURY
1. Treasury II and FMMT Treasury each covenants to operate
its respective business in the ordinary course between the date
- 10 -
<PAGE>
hereof and the Closing Date, it being understood that such
ordinary course of business will include customary dividends and
distributions.
2. FMMT Treasury 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 Treasury covenants that Treasury II 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 Treasury covenants that it will assist Treasury II
in obtaining such information as Treasury II reasonably requests
concerning the beneficial ownership of FMMT Treasury's shares.
5. Subject to the provisions of this Agreement, Treasury II
and FMMT Treasury 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 Treasury covenants that as promptly as practicable,
but in any case within 180 days after the Closing Date, Treasury
II will be furnished with an analysis of the earnings and profits
of FMMT Treasury for Federal income tax purposes, which will be
carried over by Treasury II as a result of Section 381 of the
Code, and which will be certified by its Treasurer.
7. FMMT Treasury 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 TREASURY
The obligations of FMMT Treasury to consummate the transactions
provided for herein shall be subject, at its election, to the performance
by Treasury II 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 Treasury II
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. Treasury II shall have delivered to FMMT Treasury on the
Closing Date a certificate executed in its name by a duly
- 11 -
<PAGE>
authorized officer of FICP, in form and substance satisfactory to
FMMT Treasury dated as of the Closing Date, to the effect that
the representations and warranties of Treasury II 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 Treasury
shall reasonably request.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF TREASURY II
The obligations of Treasury II to complete the transactions
provided for herein shall be subject, at its election, to the performance
by FMMT Treasury 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 Treasury
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 Treasury shall have delivered to Treasury II 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 Treasury;
3. FMMT Treasury shall have delivered to Treasury II on the
Closing Date a certificate executed in its name by a duly
authorized officer of FMMT in form and substance satisfactory to
Treasury II, dated as of the Closing Date, to the effect that the
representations and warranties of FMMT Treasury 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 Treasury II
shall reasonably request.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF TREASURY II AND
FMMT TREASURY
The obligations of FMMT Treasury hereunder are, at the option of
Treasury II, and the obligations of Treasury II hereunder are, at the
option of FMMT Treasury, 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 Treasury in
accordance with the provisions of the law of business trusts of
the State of Delaware, and certified copies of the resolutions
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evidencing such approval shall have been delivered to Treasury
II;
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 Treasury II or FMMT Treasury 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 Treasury II or FMMT Treasury, 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 Treasury 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 Treasury and Treasury II shall have received on or
before the Closing Date an opinion of Kirkpatrick & Lockhart LLP
satisfactory to FMMT Treasury and Treasury II, that for Federal
income tax purposes:
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 Treasury and Treasury
II will each be parties to the reorganization under
section 368(b) of the Code.
B. No gain or loss will be recognized by FMMT
Treasury upon the transfer of substantially all of its
assets to Treasury II in exchange solely for Treasury II
Class A Shares and Treasury II's assumption of FMMT
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Treasury's liabilities followed by the distribution of
those Treasury II Class A Shares to the FMMT Treasury
shareholders in liquidation of FMMT Treasury.
C. No gain or loss will be recognized by Treasury II
on the receipt of FMMT Treasury's assets in exchange
solely for Treasury II Class A Shares and the assumption
of FMMT Treasury's liabilities.
D. The basis of FMMT Treasury's assets in the hands
of Treasury II will be the same as the basis of such
assets in FMMT Treasury's hands immediately prior to the
Reorganization.
E. Treasury II's holding period in the assets to be
received from FMMT Treasury will include FMMT Treasury's
holding period in such assets.
F. The FMMT Treasury shareholders will recognize no
gain or loss on the exchange of the shares of beneficial
interest in FMMT Treasury ("FMMT Treasury Shares") for
the Treasury II Class A Shares in the Reorganization.
G. The FMMT Treasury shareholders' basis in the
Treasury II Class A Shares to be received by them will be
the same as their basis in the FMMT Treasury Shares to be
surrendered in exchange therefor.
H. The holding period of Treasury II Class A Shares
to be received by the FMMT Treasury shareholders will
include the holding period of the FMMT Treasury Shares to
be surrendered in exchange therefor, provided those FMMT
Treasury Shares were held as capital assets on the date
of the Reorganization.
Notwithstanding anything herein to the contrary, FMMT Treasury
may not waive the conditions set forth in this Paragraph 8.6.
9. BROKERAGE FEES AND EXPENSES
1. Treasury II and FMMT Treasury each represents and
warrants to the other that there are no brokers' or finders' fees
payable in connection with the transactions provided for herein.
2. Fidelity Management & Research Company will assume
expenses incurred by FMMT and FMMT Treasury, 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;
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(iii) printing; (iv) accounting fees; (v) legal fees; and (vi)
solicitation costs of the transactions.
10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
1. Treasury II and FMMT Treasury 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 representations, warranties, and covenants contained
in the Agreement or in any document delivered pursuant hereto or
in connection herewith shall survive the consummation of the
transactions contemplated hereunder.
11. TERMINATION
This Agreement may be terminated by the mutual agreement of
Treasury II and FMMT Treasury. In addition, either Treasury II or FMMT
Treasury 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 Treasury II or FMMT Treasury, 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
Treasury, Treasury II and FMR; provided, however, that following
the shareholders' meeting called by FMMT Treasury 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 Treasury II to be paid to FMMT Treasury
shareholders under this Agreement to the detriment of such
shareholders without their further approval.
2. At any time before the Closing Date, Treasury II or FMMT
Treasury may waive any of the conditions set forth herein
provided that such waiver will not have a material adverse effect
on the interests of such Fund's shareholders.
13. NOTICES
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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 Trusts' trustees solely in their capacity as trustees,
and not individually, and that the Trusts' 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 Trusts' assets and property. Each party
agrees that, in asserting any rights or claims under this
Agreement, it shall look only to Treasury II'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 Treasury and Treasury
II, 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 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. TREASURY PORTFOLIO
[Signature lines omitted]
FIDELITY INSTITUTIONAL CASH PORTFOLIOS
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ON BEHALF OF TREASURY II
[Signature lines omitted]
FIDELITY MANAGEMENT & RESEARCH COMPANY
[Signature lines omitted]
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EXHIBIT 2
FORM OF AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION
FIDELITY INSTITUTIONAL CASH PORTFOLIOS:
U.S. TREASURY PORTFOLIO
THIS AGREEMENT AND PLAN OF REORGANIZATION AND LIQUIDATION (the
Agreement) is made as of the ___ day of _____, 1995 by and among U.S.
Treasury Portfolio (Treasury) and Treasury II, funds of Fidelity
Institutional Cash Portfolios (the Trust) and Fidelity Management &
Research Company (FMR). The 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 Treasury in exchange solely for Class A
Shares of beneficial interest of Treasury II, and the assumption by
Treasury II of Treasury's liabilities, followed by the constructive
distribution, after the Closing Date hereinafter referred to, of such
Class A Shares of Treasury II to the shareholders of Treasury in
liquidation of Treasury 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 TREASURY IN
EXCHANGE FOR CLASS A SHARES OF TREASURY II AND LIQUIDATION OF
TREASURY
1. As of the date of this Agreement, Treasury II offers two
classes of shares, Class A and Class B and Treasury offers only
Class A Shares. As contemplated herein, in exchange for
substantially all of the assets of Treasury, and the assumption
by Treasury II of Treasury's liabilities, Treasury II shall
deliver Class A Shares of Treasury II to Treasury.
2. Subject to the terms and conditions herein set forth, and
on the basis of the representations and warranties contained
herein, Treasury agrees to transfer its assets as set forth in
paragraph 1.3 to Treasury II and Treasury II agrees to assume
Treasury's liabilities described in paragraph 1.4 hereof and
deliver to Treasury in exchange therefor the number of Class A
Shares of Treasury II equal in value (calculated in the manner
and as of the time set forth in paragraph 2.2) to the net asset
value per share of Treasury (calculated in the manner and as of
the time set forth in paragraph 2.1) multiplied by the number of
shares of Treasury then outstanding.
<PAGE>
3. The assets of Treasury to be acquired by Treasury II
shall include substantially all cash, cash equivalents,
securities, receivables (including interest or dividends
receivable), claims, choses in action, and other property owned
by Treasury and any deferred or prepaid expenses shown as an
asset on the books of Treasury on the closing date provided in
Article 3 hereof (the Closing Date).
4. The liabilities to be assumed by Treasury II shall
include (except as otherwise provided herein) all of Treasury'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, Treasury agrees to use its best efforts to discharge
all of its known liabilities prior to the Closing Date.
5. In order for Treasury 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, Treasury 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),
Treasury will liquidate and distribute pro rata to its
shareholders of record, determined as of the close of business on
the Closing Date, the Treasury II Class A Shares received by
Treasury pursuant to Article 1 in exchange for their interest in
Treasury evidenced by their shares of beneficial interest in
Treasury shares. Such liquidation and distribution will be
accomplished by the transfer of the shares then credited to the
account of Treasury on the books of Treasury II, to open accounts
on the share records of Treasury II in the names of the Treasury
shareholders and representing the respective pro rata number of
Treasury II Class A Shares due such shareholders. Treasury II
shall not issue certificates representing its shares in
connection with such exchange. Fractional shares of Treasury II
shall be rounded to the third decimal place.
7. Ownership of Treasury II Class A Shares will be shown on
the books of Treasury II's transfer agent. Treasury II Class A
Shares will be issued in the manner described in Treasury II's
current Class A Prospectus and Statement of Additional
Information.
8. Any transfer taxes payable upon the issuance of Class A
Shares of Treasury II in a name other than the registered holder
of the shares on the books of Treasury as of that time shall be
paid by the person to whom such shares are to be issued as a
condition of such transfer.
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<PAGE>
9. Any reporting responsibility of Treasury is and shall
remain the responsibility of Treasury up to and including the
Closing Date and such later date on which Treasury is liquidated.
2. VALUATION
1. The net asset value per share of Treasury's shares shall
be computed as of the close of business on the Closing Date using
the valuation procedures set forth in Treasury's then current
Prospectus or Statement of Additional Information.
2. The value of Treasury II Class A Shares shall be the net
asset value per share computed as of the Closing Date using the
valuation procedures set forth in Treasury II'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 Treasury II and Treasury.
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 the Trust or at such other time and/or place as the
parties may agree.
2. Morgan Guaranty Trust Company as custodian for Treasury
(the Custodian), shall present portfolio securities to The Bank
of New York, N.A. (BONY), as custodian for Treasury II, for
examination, and the portfolio securities and cash of Treasury
shall be delivered by the Custodian to BONY for the account of
Treasury II prior to close of business on the Closing Date. The
Custodian shall deliver at the Closing a certificate of an
authorized officer stating that (a) Treasury's securities, cash
and other assets have been duly endorsed in proper form for
transfer in such condition as to constitute good delivery
thereof, 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, in
conjunction with the delivery of portfolio securities. The cash
delivered shall be in the form of currency or certified official
bank checks, payable to the order of BONY, Custodian for Treasury
II.
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
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elsewhere is disrupted so that accurate appraisal of the value of
the total net assets of Treasury and Treasury II 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.
4. Fidelity Investments Institutional Operations Co.
(FIIOC), as transfer agent for Treasury and Treasury II, shall
deliver at the Closing a list of the names and addresses of
Treasury's shareholders and the number and percentage ownership
of outstanding shares owned by each such shareholder of Treasury,
all as of the close of business on the Closing Date, certified by
an officer of FIIOC. Treasury II shall issue and deliver to the
Secretary or Assistant Secretary of Treasury a confirmation
evidencing the Class A Shares of Treasury II to be credited on
the Liquidation Date, or provide evidence satisfactory to
Treasury that such Class A Shares of Treasury II have been
credited to Treasury's account on the books of Treasury II. 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. Treasury represents and warrants as follows:
A. Treasury 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 Investment Company Act
of 1940 (the 1940 Act), and such registration is in full
force and effect;
C. Treasury 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 the Trust, or, to the knowledge of Treasury,
of any agreement, indenture, instrument, contract, lease
or other undertaking to which Treasury is a party or by
which Treasury is bound;
D. Treasury has no material contracts or other
commitments (other than this Agreement) which will not be
terminated without liability to Treasury prior to the
Closing Date;
E. No material litigation or administrative
proceeding or investigation of or before any court or
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governmental body is presently pending or to the
knowledge of Treasury threatened against Treasury or any
of its properties or assets, except as previously
disclosed in writing to Treasury II. Treasury knows of no
facts which might form the basis for the institution of
such proceedings, and Treasury 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;
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 Treasury at March 31, 1995 (copies of
which have been furnished to Treasury II) have been
audited by Price Waterhouse LLP, independent accountants,
in accordance with generally accepted auditing standards.
Such financial statements are presented in accordance
with generally accepted accounting principles, and fairly
present, in all material respects, the financial
condition of Treasury as of such date, and there are no
material known liabilities of Treasury at such date
(contingent or otherwise) not disclosed therein;
G. Since March 31, 1995, there has not been any
material adverse change in Treasury'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 Treasury
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
Treasury'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 periods from November 9,
1985 through March 31, 1986 and for each subsequent
taxable fiscal year ended March 31 through the fiscal
year ended March 31, 1995, Treasury 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 Treasury shares are,
and at the Closing Date will be, duly and validly issued
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and outstanding, fully paid and nonassessable, as a
matter of Delaware law. All of the issued and outstanding
Treasury 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 Treasury II in accordance with
the provisions of paragraph 3.4 hereof.
K. At the Closing Date, Treasury will have good and
marketable title to its assets to be transferred to
Treasury II 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, Treasury II will 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 Treasury, and this Agreement constitutes a valid
and binding obligation of Treasury enforceable in
accordance with its terms, subject to shareholder
approval;
M. The information to be furnished by Treasury 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 Treasury to be included in
the registration statement filed with the Securities and
Exchange Commission by the Trust on Form N-14 relating to
the Treasury II 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 Treasury'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;
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O. Treasury 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. Treasury will, from time to time, as and when
requested by Treasury II, 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 Treasury II may deem necessary or
desirable in order to vest in and confirm to Treasury II
title to and possession of all the assets of Treasury to
be sold, assigned, transferred and delivered hereunder
and otherwise to carry out the intent and purpose of this
Agreement;
Q. The execution and delivery of this Agreement does
not, and the consummation of the transactions
contemplated hereby will not, conflict with the Trust's
Trust Instrument or By-Laws or, to Treasury's knowledge,
any provision of any agreement to which Treasury is a
party or by which it is bound or, to the knowledge of
Treasury, result in the acceleration of any obligation or
the imposition of any penalty under any agreement,
judgment or decree to which Treasury is a party or by
which it is bound;
R. To Treasury's knowledge, no consent, approval,
authorization or order of any court or governmental
authority is required for the consummation by Treasury 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;
S. The fair market value of the assets of Treasury
will equal or exceed the liabilities to be assumed by
Treasury II and to which the assets are subject; and
T. Treasury's liabilities to be assumed by Treasury
II were incurred by Treasury in the ordinary course of
business.
2. Treasury II represents and warrants as follows:
A. Treasury II 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;
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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. Treasury II 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 the Trust, or, to the knowledge
of Treasury II, of any agreement, indenture, instrument,
contract, lease or other undertaking to which Treasury II
is a party or by which Treasury II 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 Treasury II, threatened against Treasury II
or any of its properties or assets, except as previously
disclosed in writing to Treasury. Treasury II knows of no
facts which might form the basis for the institution of
such proceedings and Treasury II 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;
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 Treasury II at March 31, 1995 (copies of
which have been furnished to Treasury) are presented in
accordance with generally accepted accounting principles,
and fairly present, in all material respects, the
financial condition of Treasury II as of such date, and
there are no material known liabilities of Treasury II at
such date (contingent or otherwise) not disclosed
therein;
F. Since March 31, 1995, there has not been any
material adverse change in Treasury II'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 Treasury II
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
Treasury II's knowledge, no such return is currently
under audit and no assessment has been asserted with
respect to such returns;
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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, Treasury II 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 Treasury II 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 Treasury II, and this Agreement constitutes the
valid and binding obligation of Treasury II enforceable
in accordance with its terms;
K. The Treasury II Class A Shares to be issued and
delivered to Treasury 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 Treasury II,
fully paid and non-assessable under Delaware law;
L. On the effective date of the Registration
Statement, at the time of the meeting of Treasury'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 Treasury for use
in the Registration Statement;
M. The information to be furnished by Treasury II
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;
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N. Treasury II 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. Treasury II will, from time to time, as and when
requested by Treasury, 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 Treasury may deem necessary or
desirable in order to vest in and confirm to Treasury,
title to and possession of all of Treasury II'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 the Trust's
Trust Instrument or By-Laws, or to Treasury II's
knowledge, any provision of any agreement to which
Treasury II is a party or by which it is bound or, to the
knowledge of Treasury II, result in the acceleration of
any obligations or the imposition of any penalty under
any agreement, judgment or decree to which Treasury II is
a party or by which it is bound; and
Q. To Treasury II's knowledge, no consent,
approval, authorization or order of any court or
governmental authority is required for the consummation
by Treasury II 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.
5. COVENANTS OF TREASURY II AND TREASURY
1. Treasury II and Treasury 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. Treasury 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. Treasury covenants that Treasury II Class A Shares to be
issued hereunder are not being acquired for the purpose of making
- 10 -
<PAGE>
any distribution thereof other than in accordance with the terms
of this Agreement.
4. Treasury covenants that it will assist Treasury II in
obtaining such information as Treasury II reasonably requests
concerning the beneficial ownership of Treasury's shares.
5. Subject to the provisions of this Agreement, Treasury II
and Treasury 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. Treasury covenants that as promptly as practicable, but
in any case within 180 days after the Closing Date, Treasury II
will be furnished with an analysis of the earnings and profits of
Treasury for Federal income tax purposes, which will be carried
over by Treasury II as a result of Section 381 of the Code, and
which will be certified by its Treasurer.
7. Treasury 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 TREASURY
The obligations of Treasury to consummate the transactions
provided for herein shall be subject, at its election, to the performance
by Treasury II 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 Treasury II
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. Treasury II shall have delivered to Treasury on the
Closing Date a certificate executed in its name by a duly
authorized officer of the Trust, in form and substance
satisfactory to Treasury dated as of the Closing Date, to the
effect that the representations and warranties of Treasury II
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
Treasury shall reasonably request.
- 11 -
<PAGE>
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF TREASURY II
The obligations of Treasury II to complete the transactions
provided for herein shall be subject, at its election, to the performance
by Treasury 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 Treasury 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. Treasury shall have delivered to Treasury II 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 Treasury;
3. Treasury shall have delivered to Treasury II on the
Closing Date a certificate executed in its name by a duly
authorized officer of the Trust in form and substance
satisfactory to Treasury II, dated as of the Closing Date, to the
effect that the representations and warranties of Treasury 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
Treasury II shall reasonably request.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF TREASURY II AND
TREASURY
The obligations of Treasury hereunder are, at the option of
Treasury II, and the obligations of Treasury II hereunder are, at the
option of Treasury, 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 Treasury 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 Treasury
II;
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;
- 12 -
<PAGE>
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 Treasury II or Treasury 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 Treasury II or Treasury, 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. Treasury 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;
6. Treasury and Treasury II shall have received on or before
the Closing Date an opinion of Kirkpatrick & Lockhart LLP
satisfactory to Treasury and Treasury II, that for Federal income
tax purposes:
A. The Reorganization will be a reorganization under
section 368(a)(1)(C) of the Internal Revenue Code of
1986, as amended ("Code"), and Treasury and Treasury II
will each be parties to the reorganization under section
368(b) of the Code.
B. No gain or loss will be recognized by Treasury
upon the transfer of substantially all of its assets to
Treasury II in exchange solely for Treasury II Class A
Shares and Treasury II's assumption of Treasury's
liabilities followed by the distribution of those
Treasury II Class A Shares to the Treasury shareholders
in liquidation of Treasury.
C. No gain or loss will be recognized by Treasury II
on the receipt of Treasury's assets in exchange solely
for the Treasury II Class A Shares and the assumption of
Treasury's liabilities.
- 13 -
<PAGE>
D. The basis of Treasury's assets in the hands of
Treasury II will be the same as the basis of such assets
in Treasury's hands immediately prior to the
Reorganization.
E. Treasury II's holding period in the assets to be
received from Treasury will include Treasury's holding
period in such assets.
F. The Treasury shareholders will recognize no gain
or loss on the exchange of the shares of beneficial
interest in Treasury ("Treasury Shares") for the Treasury
II Class A Shares in the Reorganization.
G. The Treasury shareholders' basis in the Treasury
II Class A Shares to be received by them will be the same
as their basis in the Treasury Shares to be surrendered
in exchange therefor.
H. The holding period of the Treasury II Class A
Shares to be received by the Treasury shareholders will
include the holding period of the Treasury Shares to be
surrendered in exchange therefor, provided those Treasury
Shares were held as capital assets on the date of the
Reorganization.
Notwithstanding anything herein to the contrary, Treasury may not
waive the conditions set forth in this Paragraph 8.6.
9. BROKERAGE FEES AND EXPENSES
1. Treasury II and Treasury each represents and warrants to
the other that there are no brokers' or finders' fees payable in
connection with the transactions provided for herein.
2. Treasury shall be responsible for all expenses, fees and
other charges, (subject to FMR's voluntary expense limitation
which limits Treasury's total operating expenses to .20% of its
average net assets) if applicable, 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. Treasury II and Treasury agree that neither party has
made any representation, warranty or covenant not set forth
- 14 -
<PAGE>
herein and that this Agreement constitutes the entire agreement
between the parties.
2. The representations, warranties, and covenants contained
in the Agreement or in any document delivered pursuant hereto or
in connection herewith shall survive the consummation of the
transactions contemplated hereunder.
11. TERMINATION
This Agreement may be terminated by the mutual agreement of
Treasury II and Treasury. In addition, either Treasury II or Treasury 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 Treasury II or Treasury, 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
Treasury, Treasury II and FMR; provided, however, that following
the shareholders' meeting called by Treasury 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 Treasury II to be paid to Treasury shareholders
under this Agreement to the detriment of such shareholders
without their further approval.
2. At any time before the Closing Date, Treasury II or
Treasury may waive any of the conditions set forth herein,
provided that such waiver will not have a material adverse effect
on the 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 or FMR, as appropriate, 82 Devonshire
Street, Boston, Massachusetts 02109, Attention: Arthur S. Loring.
- 15 -
<PAGE>
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 the Trust is a Delaware
business trust. Notice is hereby given that this Agreement is
executed on behalf of the 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 Treasury II'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 Treasury II and
Treasury, respectively, and not to their shareholders
individually or to the Trustees of the Trust.
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 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 INSTITUTIONAL CASH PORTFOLIOS
on behalf of U.S. Treasury Portfolio
[Signature lines omitted]
FIDELITY INSTITUTIONAL CASH PORTFOLIOS
on behalf of Treasury II
[Signature lines omitted]
FIDELITY MANAGEMENT & RESEARCH COMPANY
[Signature lines omitted]
- 16 -
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Statement of Assets and Liabilities
as of March 31, 1995
(Unaudited)
FMMT Pro Forma Pro Forma
Treasury II Treasury Combined Adjustments Combined
-------------- -------------- --------------- ----------- ---------------
<S> <C> <C> <C> <C> <C>
Assets
Investment in securities, at value
- See accompanying schedule $ 6,330,580,220 $ 159,776,722 $ 6,490,356,942 $ 6,490,356,942
Interest receivable 9,087,075 300,476 9,387,551 9,387,551
Receivable from investment adviser
for expense reductions 422,125 0 422,125 422,125
-------------- ------------- -------------- --------------
Total assets 6,340,089,420 160,077,198 6,500,166,618 6,500,166,618
-------------- ------------- -------------- --------------
Liabilities
Payable for investments purchased 1,049,033,360 27,921,040 1,076,954,400 1,076,954,400
Share transactions in process 329,903 0 329,903 329,903
Dividends payable 15,497,032 234,150 15,731,182 15,731,182
Accrued management fee 804,534 49,358 853,892 853,892
Other payables and accrued expenses 655,174 0 655,174 655,174
-------------- ------------- -------------- --------------
Total liabilities 1,066,320,003 28,204,548 1,094,524,551 1,094,524,551
-------------- ------------- -------------- --------------
Net Assets $ 5,273,769,417 $ 131,872,650 $ 5,405,642,067 $ 5,405,642,067
============== ============= ============== ==============
Net Assets consist of:
Paid in capital $ 5,274,371,906 $ 131,912,970 $ 5,406,284,876 $ 5,406,284,876
Accumulated net realized gain
(loss) on investments (602,489) (40,320) (642,809) (642,809)
-------------- ------------- -------------- --------------
Net Assets $ 5,273,769,417 $ 131,872,650 $ 5,405,642,067 $ 5,405,642,067
============== ============= ============== ==============
Net Asset Value
Class A:
Net Assets $ 4,688,198,169 $ 131,872,650 $ 4,820,070,819 $ 4,820,070,819
Offering price and redemption
price per share $1.00 $1.00 $1.00 $1.00
Class B:
Net Assets $ 585,571,248 -- $ 585,571,248 $ 585,571,248
Offering price and redemption
price per share $1.00 -- $1.00 $1.00
Shares outstanding:
Class A: 4,688,611,950 131,912,970 4,820,524,920 4,820,524,920
Class B: 585,622,931 -- 585,622,931 585,622,931
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Statement of Operations
Year Ended March 31, 1995
(Unaudited)
FMMT Pro Forma Pro Forma
Treasury II Treasury Combined Adjustments Combined
-------------- ----------- -------------- ----------- --------------
<S> <C> <C> <C> <C> <C>
Interest Income $ 212,775,731 $ 7,741,300 $ 220,517,031 $ 220,517,031
------------- ---------- ------------- -------------
Expenses
Management fee 8,680,344 676,492 9,356,836 (354,500)(a) 9,002,336
Transfer agent fees
Class A 1,278,161 0 1,278,161 188,500 (b) 1,466,661
Class B 28,447 0 28,447 28,447
Distribution fees - Class B 418,917 0 418,917 418,917
Accounting fees and expenses 375,762 0 375,762 12,100 (c) 387,862
Non-interested trustees' compensation 86,005 0 86,005 884 (b) 86,889
Custodian fees and expenses 104,003 0 104,003 35,251 (b) 139,254
Registration fees - Class A 342,613 0 342,613 23,000 (b) 365,613
Registration fees - Class B 333,235 0 333,235 333,235
Audit 31,578 0 31,578 31,578
Legal 49,903 0 49,903 2,600 (b) 52,503
Reports to shareholders 1,174 0 1,174 1,174
Miscellaneous 40,222 0 40,222 2,600 (b) 42,822
------------- ---------- ------------- -------------
Total expenses before reductions 11,770,364 676,492 12,446,856 12,357,291
Expense reductions (3,539,319) 0 (3,539,319) 603,283 (d) (2,936,036)
------------- ---------- ------------- -------------
8,231,045 676,492 8,907,537 9,421,255
------------- ---------- ------------- -------------
Net interest income 204,544,686 7,064,808 211,609,494 211,095,776
Net realized gain (loss) on investmen (367,507) (13,755) (381,262) (381,262)
------------- ---------- ------------- -------------
Net increase in net assets resulting
from operations $ 204,177,179 $ 7,051,053 $ 211,228,232 $ 210,714,514
============= ========== ============= =============
</TABLE>
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: TREASURY II
FIDELITY MONEY MARKET TRUST: U.S. TREASURY PORTFOLIO
NOTES TO PRO FORMA COMBINED FINANCIAL STATEMENTS
(UNAUDITED)
The accompanying unaudited Pro Forma Combined Schedule of Investments and
Statement of Assets and Liabilities as of March 31, 1995 and the unaudited
Pro Forma Combined Statement of Operations for the year ended March 31,
1995 are intended to present the financial condition and related results
of operations of Fidelity Institutional Cash Portfolios: Treasury II
(Treasury II) as if the reorganization with Fidelity Money Market Trust:
U.S. Treasury Portfolio (FMMT Treasury) had been consummated at March 31,
1994. These pro forma financial statements do not take into account the
effect of the reorganization of Fidelity Institutional Cash Portfolios:
U.S. Treasury Portfolio with Treasury II.
During the year ended March 31, 1995, Fidelity Management & Research
Company (FMR), investment adviser to the funds, voluntarily agreed to re-
imburse Treasury II for operating expenses (excluding interest, taxes,
brokerage commissions, extraordinary expenses and 12b-1 fees payable by
Class B shares) above an annual rate of .18% of average net assets. Effec-
tive July 1, 1995, FMR increased this expense limitation from .18% to
.20%. The accompanying pro forma financial statements reflect the effects
of both the reorganization and the increase in the expense limitation. Had
the pro forma adjustments not included the effect of the increased expense
limitation, Pro Forma Combined Expense reductions would have been
$(3,836,269), resulting in Pro Forma Combined Net interest income and Pro
Forma Combined Net increase in net assets resulting from operations of
$211,996,009 and $211,614,747, respectively.
The pro forma adjustments to these pro forma financial statements are com-
prised of:
(a) Decrease in Management fee due to the change from the all-inclusive
expense contract for FMMT Treasury (annual rate of .42% of average net
assets) to the annual management fee contract rate of .20% of average net
assets for Treasury II.
(b) Increase in other expense items to reflect actual expenses incurred by
FMR under the all-inclusive expense contract for FMMT Treasury. Under the
reorganization, these expenses would have been incurred by Treasury II.
(c) Increase in Accounting fees and expenses resulting from an increase in
combined net assets of the two funds.
(d) Decrease in Expense reductions results primarily from the change in
the voluntary expense limitation effected July 1, 1995, net of the effect
resulting from an increase in combined net assets of the two funds.
The unaudited pro forma combined financial statements should be read in
conjunction with the separate annual audited financial statements as of
March 31, 1995 for Treasury II (f/k/a Fidelity Institutional Cash Port-
folios: U.S. Treasury Portfolio II) and the separate semiannual unaudited
financial statements as of February 28, 1995 and the separate annual
audited financial statements as of August 31, 1994 for FMMT Treasury,
which statements are incorporated by reference in the Statement of Addi-
tional Information to this Proxy Statement and Prospectus.
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited)
Principal Amount
--------------------------------------------------
Annualized Combined
Due Yield at Time FMMT Treasury II
Date of Purchase Treasury II Treasury & FMMT Treasury
------- ------------- -------------- ------------- -----------------
<S> <C> <C> <C> <C> <C>
U.S. Treasury Obligations
U.S. Treasury Bills
4/20/95 5.97% $ 0 $ 28,000,000 $ 28,000,000
5/4/95 5.68% 1,179,000,000 3,000,000 1,182,000,000
7/13/95 6.63% 0 6,000,000 6,000,000
7/13/95 6.64% 192,000,000 0 192,000,000
7/27/95 6.40% 116,000,000 4,000,000 120,000,000
8/10/95 6.29% 134,000,000 9,000,000 143,000,000
8/24/95 5.48% 121,000,000 5,000,000 126,000,000
8/31/95 6.19% 145,000,000 3,000,000 148,000,000
U. S. Treasury Notes
4/30/95 5.54% 110,000,000 4,000,000 114,000,000
5/15/95 5.66% 53,000,000 2,000,000 55,000,000
5/15/95 6.23% 54,000,000 2,000,000 56,000,000
5/15/95 6.33% 54,000,000 2,000,000 56,000,000
5/15/95 6.45% 54,000,000 2,000,000 56,000,000
5/15/95 6.46% 57,000,000 1,000,000 58,000,000
TOTAL U.S. TREASURY OBLIGATIONS
Maturity Amount
-------------------------------------------------
Combined
FMMT Treasury II
Treasury II Treasury & FMMT Treasury
-------------- ------------- -----------------
Repurchase Agreements
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 $ 0 $ 100,051,667
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 0 115,060,183
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited) - continued
Maturity Amount
--------------------------------------------------
Combined
FMMT Treasury II
Treasury II Treasury & FMMT Treasury
-------------- ------------- -----------------
<S> <C> <C> <C>
Repurchase Agreements - continued
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 $ 0 $ 106,055,650
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 0 102,042,544
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 0 106,055,650
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 0 15,007,625
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 0 106,055,385
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/95, due 4/3/95
At 6.20% 3,149,626,170 49,025,312 3,198,651,482
At 6.23% 332,298,444 40,467,000 372,765,444
TOTAL REPURCHASE AGREEMENTS
TOTAL INVESTMENTS
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited)
Value
--------------------------------------------------
Annualized Combined
Due Yield at Time FMMT Treasury II
Date of Purchase Treasury II Treasury & FMMT Treasury
------- ------------- -------------- ------------- -----------------
<S> <C> <C> <C> <C> <C>
U.S. Treasury Obligations
U.S. Treasury Bills
4/20/95 5.97% $ 0 $ 27,921,040 $ 27,921,040
5/4/95 5.68% 1,125,643,740 2,984,820 1,128,628,560
7/13/95 6.63% 0 5,889,876 5,889,876
7/13/95 6.64% 188,472,918 0 188,472,918
7/27/95 6.40% 113,662,600 3,919,400 117,582,000
8/10/95 6.29% 131,025,573 8,800,225 139,825,798
8/24/95 5.48% 118,465,722 4,895,278 123,361,000
8/31/95 6.19% 141,326,666 2,924,000 144,250,666
------------- ------------ -------------
1,818,597,219 57,334,639 1,875,931,858
------------- ------------ -------------
U. S. Treasury Notes
4/30/95 5.54% 109,843,423 3,994,306 113,837,729
5/15/95 5.66% 53,001,423 2,000,053 55,001,476
5/15/95 6.23% 53,973,966 1,999,036 55,973,002
5/15/95 6.33% 53,967,516 1,998,797 55,966,313
5/15/95 6.45% 54,126,086 2,004,670 56,130,756
5/15/95 6.46% 56,955,587 999,221 57,954,808
------------- ------------ -------------
381,868,001 12,996,083 394,864,084
------------- ------------ -------------
TOTAL U.S. TREASURY OBLIGATIONS 2,200,465,220 70,330,722 2,270,795,942
------------- ------------ -------------
Repurchase Agreements
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 $ 100,000,000 0 100,000,000
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 8/15/08 115,000,000 0 115,000,000
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited) - continued
Value
--------------------------------------------------
Combined
FMMT Treasury II
Treasury II Treasury & FMMT Treasury
-------------- ------------- -----------------
<S> <C> <C> <C>
Repurchase Agreements - continued
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 $ 106,000,000 $ 0 $ 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%, 6/29/95 101,989,000 0 101,989,000
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 11/15/12 106,000,000 0 106,000,000
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 15,000,000 0 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 8/15/03 106,000,000 0 106,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/95, due 4/3/95
At 6.20% 3,148,000,000 49,000,000 3,197,000,000
At 6.23% 332,126,000 40,446,000 372,572,000
-------------- ------------ -------------
TOTAL REPURCHASE AGREEMENTS 4,130,115,000 89,446,000 4,219,561,000
-------------- ------------ -------------
TOTAL INVESTMENTS $ 6,330,580,220 $ 159,776,722 $6,490,356,942
============== ============ =============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Institutional Cash Portfolios: U.S. Treasury Portfolio
Pro Forma Combined Statement of Assets and Liabilities
as of March 31, 1995
(Unaudited)
FICP Pro Forma Pro Forma
Treasury II Treasury Combined Adjustments Combined
------------- -------------- -------------- ----------- ---------------
<S> <C> <C> <C> <C> <C>
Assets
Investment in securities, at value
- See accompanying schedule $ 6,330,580,220 $1,457,283,052 $7,787,863,272 $7,787,863,272
Cash 0 16,520 16,520 16,520
Interest receivable 9,087,075 2,639,166 11,726,241 11,726,241
Receivable from investment adviser for expense
reductions 422,125 62,685 484,810 484,810
-------------- ------------- ------------- -------------
Total assets 6,340,089,420 1,460,001,423 7,800,090,843 7,800,090,843
-------------- ------------- ------------- -------------
Liabilities
Payable for investments purchased 1,049,033,360 259,266,800 1,308,300,160 1,308,300,160
Share transactions in process 329,903 0 329,903 329,903
Dividends payable 15,497,032 2,664,291 18,161,323 18,161,323
Accrued management fee 804,534 202,084 1,006,618 1,006,618
Other payables and accrued expenses 655,174 146,781 801,955 801,955
-------------- ------------- ------------- -------------
Total liabilities 1,066,320,003 262,279,956 1,328,599,959 1,328,599,959
-------------- ------------- ------------- -------------
Net Assets $ 5,273,769,417 $1,197,721,467 $6,471,490,884 $6,471,490,884
============== ============= ============= =============
Net Assets consist of:
Paid in capital $ 5,274,371,906 $1,198,232,716 $6,472,604,622 $6,472,604,622
Accumulated net realized gain (loss) on
investments (602,489) (511,249) (1,113,738) (1,113,738)
-------------- ------------- ------------- -------------
Net Assets $ 5,273,769,417 $1,197,721,467 $6,471,490,884 $6,471,490,884
============== ============= ============= =============
Net Asset Value
Class A:
Net Assets $ 4,688,198,169 $1,197,721,467 $5,885,919,636 $5,885,919,636
Offering price and redemption price per share $1.00 $1.00 $1.00 $1.00
Class B:
Net Assets $ 585,571,248 -- $ 585,571,248 $ 585,571,248
Offering price and redemption price per share $1.00 -- $1.00 $1.00
Shares outstanding:
Class A: 4,688,611,950 1,198,225,128 5,886,837,078 5,886,837,078
Class B: 585,622,931 -- 585,622,931 585,622,931
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Institutional Cash Portfolios: U.S. Treasury Portfolio
Pro Forma Combined Statement of Operations
Year Ended March 31, 1995
(Unaudited)
FICP Pro Forma Pro Forma
Treasury II Treasury Combined Adjustments Combined
------------ ---------- ------------- ----------- --------------
<S> <C> <C> <C> <C> <C>
Interest Income $ 212,775,731 $ 63,568,355 $ 276,344,086 $ 276,344,086
------------- ------------- ------------- -------------
Expenses
Management fee 8,680,344 2,645,934 11,326,278 11,326,278
Transfer agent fees
Class A 1,278,161 113,703 1,391,864 1,391,864
Class B 28,447 0 28,447 28,447
Distribution fees - Class B 418,917 0 418,917 418,917
Accounting fees and expenses 375,762 149,193 524,955 (50,000)(a) 474,955
Non-interested trustees' compensation 86,005 47,131 133,136 133,136
Custodian fees and expenses 104,003 110,308 214,311 214,311
Registration fees - Class A 342,613 85,803 428,416 428,416
Registration fees - Class B 333,235 0 333,235 333,235
Audit 31,578 19,247 50,825 (2,000)(b) 48,825
Legal 49,903 17,080 66,983 66,983
Reports to shareholders 1,174 469 1,643 1,643
Miscellaneous 40,222 14,760 54,982 54,982
------------- ------------- ------------- ------------
Total expenses before reductions 11,770,364 3,203,628 14,973,992 14,921,992
Expense reductions (3,539,319) (822,285) (4,361,604) 1,184,664 (3,176,940)
------------- ------------- ------------- ------------
8,231,045 2,381,343 10,612,388 11,745,052
------------- ------------- ------------- ------------
Net interest income 204,544,686 61,187,012 265,731,698 264,599,034
Net realized gain (loss) on investments (367,507) (156,575) (524,082) (524,082)
------------- ------------- ------------- ------------
Net increase in net assets resulting
from operations $ 204,177,179 $ 61,030,437 $ 265,207,616 $ 264,074,952
============= ============= ============= ============
</TABLE>
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: TREASURY II
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY PORTFOLIO
NOTES TO PRO FORMA COMBINED FINANCIAL STATEMENTS
(UNAUDITED)
The accompanying unaudited Pro Forma Combined Schedule of Investments and
Statement of Assets and Liabilities as of March 31, 1995 and the unaudited
Pro Forma Combined Statement of Operations for the year ended March 31,
1995 are intended to present the financial condition and related results
of operations of Fidelity Institutional Cash Portfolios: Treasury II
(Treasury II) as if the reorganization with Fidelity Institutional Cash
Portfolios: U.S. Treasury Portfolio (FICP Treasury) had been consummated
at March 31, 1994. These pro forma financial statements do not take into
account the effect of the reorganization of Fidelity Money Market Trust:
U.S. Treasury Portfolio with Treasury II.
During the year ended March 31, 1995, Fidelity Management & Research Com-
pany (FMR), investment adviser to the funds, voluntarily agreed to reim-
burse Treasury II for operating expenses (excluding interest, taxes,
brokerage commissions, extraordinary expenses and 12b-1 fees payable by
Class B shares) above an annual rate of .18% of average net assets.
Effective July 1, 1995, FMR increased this expense limitation from .18% to
.20%. The accompanying pro forma financial statements reflect the effects
of both the reorganization and the increase in the expense limitation. Had
the pro forma adjustments not included the effect of the increased expense
limitation, Pro Forma Combined Expense reductions would have been
$(4,309,604), resulting in Pro Forma Combined Net interest income and Pro
Forma Combined Net increase in net assets resulting from operations of
$265,731,698 and $265,207,616, respectively.
The pro forma adjustments to these pro forma financial statements are
comprised of:
(a) Decrease in Accounting fees and expenses due to reduction in base fee
rate resulting from combined net assets of the two funds.
(b) Decrease in Audit expense to reflect elimination of FICP Treasury.
(c) Decrease in Expense reductions results primarily from the change in
the voluntary expense limitation effected July 1, 1995.
The unaudited pro forma combined financial statements should be read in
conjunction with the separate annual audited financial statements as of
March 31, 1995 for Treasury II (f/k/a Fidelity Institutional Cash
Portfolios: U.S. Treasury Portfolio II) and the separate annual audited
financial statements as of March 31, 1995 for FICP Treasury, which
statements are incorporated by reference in the Statement of Additional
Information to this Proxy Statement and Prospectus.
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995
(Unaudited)
Principal Amount
------------------------------------------------
Annualized Combined
Due Yield at Time FICP Treasury II
Date of Purchase Treasury II Treasury & FICP Treasury
------- ------------- -------------- ------------- -----------------
<S> <C> <C> <C> <C> <C>
U.S. Treasury Obligations
U.S. Treasury Bills
4/20/95 5.97% $ 0 $ 259,266,800 $ 259,266,800
5/4/95 5.68% 1,179,000,000 22,000,000 1,201,000,000
7/13/95 6.63% 0 57,000,000 57,000,000
7/13/95 6.64% 192,000,000 0 192,000,000
7/27/95 6.40% 116,000,000 28,000,000 144,000,000
8/10/95 6.29% 134,000,000 35,000,000 169,000,000
8/24/95 5.48% 121,000,000 40,000,000 161,000,000
8/31/95 6.19% 145,000,000 42,000,000 187,000,000
U. S. Treasury Notes
4/30/95 5.54% 110,000,000 34,000,000 144,000,000
5/15/95 5.66% 53,000,000 15,000,000 68,000,000
5/15/95 6.23% 54,000,000 15,000,000 69,000,000
5/15/95 6.33% 54,000,000 15,000,000 69,000,000
5/15/95 6.45% 54,000,000 15,000,000 69,000,000
5/15/95 6.46% 57,000,000 15,000,000 72,000,000
TOTAL U.S. TREASURY OBLIGATIONS
Medium-Term Note
Export-Import Bank, U.S. (a)
(as guarantor for K.A. Leasing,
Ltd.) 4/15/95 6.25% 0 15,608,350 15,608,350
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited) - continued
Maturity Amount
------------------------------------------------
Combined
FICP Treasury II
Treasury II Treasury & FICP Treasury
-------------- ------------- -----------------
<S> <C> <C> <C>
Repurchase Agreements
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 0 100,051,667
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 0 115,060,183
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 0 106,055,650
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 0 102,042,544
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 0 106,055,650
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 0 15,007,625
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited) - continued
Maturity Amount
------------------------------------------------
Combined
FICP Treasury II
Treasury II Treasury & FICP Treasury
-------------- ------------- -----------------
<S> <C> <C> <C>
Repurchase Agreements - continued
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 $ 0 $ 106,055,385
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/95, due 4/3/95
At 6.20% 3,149,626,170 0 3,149,626,170
At 6.20% 0 529,273,398 529,273,398
At 6.23% 332,298,444 61,699,018 393,997,462
At 6.24% 0 263,319,925 263,319,925
TOTAL REPURCHASE AGREEMENTS
TOTAL INVESTMENTS
(a) To conform to the investment limitations of Treasury II, this security will
be sold by FICP Treasury prior to the Closing date of the Reorganization.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited)
Value
------------------------------------------------
Annualized Combined
Due Yield at Time FICP Treasury II
Date of Purchase Treasury II Treasury & FICP Treasury
------- ------------- -------------- ------------- -----------------
<S> <C> <C> <C> <C> <C>
U.S. Treasury Obligations
U.S. Treasury Bills
4/20/95 5.97% $ 0 $ 259,266,800 $ 259,266,800
5/4/95 5.68% 1,125,643,740 21,888,680 1,147,532,420
7/13/95 6.63% 0 55,953,821 55,953,821
7/13/95 6.64% 188,472,918 0 188,472,918
7/27/95 6.40% 113,662,600 27,435,800 141,098,400
8/10/95 6.29% 131,025,573 34,223,097 165,248,670
8/24/95 5.48% 118,465,722 39,161,416 157,627,138
8/31/95 6.19% 141,326,666 40,936,000 182,262,666
-------------- ------------- ---------------
1,818,597,219 478,865,614 2,297,462,833
-------------- ------------- ---------------
U. S. Treasury Notes
4/30/95 5.54% 109,843,423 33,951,603 143,795,026
5/15/95 5.66% 53,001,423 15,000,403 68,001,826
5/15/95 6.23% 53,973,966 14,992,768 68,966,734
5/15/95 6.33% 53,967,516 14,990,977 68,958,493
5/15/95 6.45% 54,126,086 15,035,024 69,161,110
5/15/95 6.46% 56,955,587 14,988,313 71,943,900
-------------- ------------- ---------------
381,868,001 108,959,088 490,827,089
-------------- ------------- ---------------
TOTAL U.S. TREASURY OBLIGATIONS 2,200,465,220 587,824,702 2,788,289,922
-------------- ------------- ---------------
Medium-Term Note
Export-Import Bank, U.S. (a)
(as guarantor for K.A. Leasing,
Ltd.) 4/15/95 6.25% 0 15,608,350 15,608,350
-------------- ------------- ---------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited) - continued
Value
------------------------------------------------
Combined
FICP Treasury II
Treasury II Treasury & FICP Treasury
-------------- ------------- -----------------
<S> <C> <C> <C>
Repurchase Agreements
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 2/15/23 100,000,000 0 100,000,000
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 8/15/08 115,000,000 0 115,000,000
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 11/15/24 106,000,000 0 106,000,000
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%, 6/29/95 101,989,000 0 101,989,000
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 11/15/12 106,000,000 0 106,000,000
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 15,000,000 0 15,000,000
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II and
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited) - continued
Value
------------------------------------------------
Combined
FICP Treasury II
Treasury II Treasury & FICP Treasury
-------------- ------------- -----------------
<S> <C> <C> <C>
Repurchase Agreements - continued
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 $ 106,000,000 $ 0 $ 106,000,000
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/95, due 4/3/95
At 6.20% 3,148,000,000 0 3,148,000,000
At 6.20% 0 529,000,000 529,000,000
At 6.23% 332,126,000 61,667,000 393,793,000
At 6.24% 0 263,183,000 263,183,000
-------------- ------------ --------------
TOTAL REPURCHASE AGREEMENTS 4,130,115,000 853,850,000 4,983,965,000
-------------- ------------ --------------
TOTAL INVESTMENTS $ 6,330,580,220 $1,457,283,052 $7,787,863,272
============== ============= =============
(a) To conform to the investment limitations of Treasury II, this security will
be sold by FICP Treasury prior to the Closing date of the Reorganization.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II,
Fidelity Institutional Cash Portfolios: U.S. Treasury Portfolio and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Statement of Assets and Liabilities
as of March 31, 1995
(Unaudited)
FICP FMMT Pro Forma Pro Forma
Treasury II Treasury Treasury Combined Adjustments Combined
----------------- --------------- -------------- --------------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Assets
Investment in securities, at value
- See accompanying schedule $ 6,330,580,220 $ 1,457,283,052 $ 159,776,722 $ 7,947,639,994 $ 7,947,639,994
Cash 0 16,520 0 16,520 16,520
Interest receivable 9,087,075 2,639,166 300,476 12,026,717 12,026,717
Receivable from investment adviser
for expense reductions 422,125 62,685 0 484,810 484,810
-------------- ------------- ------------- -------------- --------------
Total assets 6,340,089,420 1,460,001,423 160,077,198 7,960,168,041 7,960,168,041
-------------- ------------- ------------- -------------- --------------
Liabilities
Payable for investments purchased 1,049,033,360 259,266,800 27,921,040 1,336,221,200 1,336,221,200
Share transactions in process 329,903 0 0 329,903 329,903
Dividends payable 15,497,032 2,664,291 234,150 18,395,473 18,395,473
Accrued management fee 804,534 202,084 49,358 1,055,976 1,055,976
Other payables and accrued expense 655,174 146,781 0 801,955 801,955
-------------- ------------- ------------ -------------- --------------
Total liabilities 1,066,320,003 262,279,956 28,204,548 1,356,804,507 1,356,804,507
-------------- ------------- ------------ -------------- --------------
Net Assets $ 5,273,769,417 $ 1,197,721,467 $ 131,872,650 $ 6,603,363,534 $ 6,603,363,534
============== ============== ============ ============== ==============
Net Assets consist of:
Paid in capital $ 5,274,371,906 $ 1,198,232,716 $ 131,912,970 $ 6,604,517,592 $ 6,604,517,592
Accumulated net realized gain
(loss) on investments (602,489) (511,249) (40,320) (1,154,058) (1,154,058)
-------------- -------------- ------------- -------------- --------------
Net Assets $ 5,273,769,417 $ 1,197,721,467 $ 131,872,650 $ 6,603,363,534 $ 6,603,363,534
============== ============== ============= ============== ==============
Net Asset Value
Class A:
Net Assets $ 4,688,198,169 $ 1,197,721,467 $ 131,872,650 $ 6,017,792,286 $ 6,017,792,286
Offering price and redemption
price per share $1.00 $1.00 $1.00 $1.00 $1.00
Class B:
Net Assets $ 585,571,248 -- -- $ 585,571,248 $ 585,571,248
Offering price and redemption
price per share $1.00 -- -- $1.00 $1.00
Shares outstanding
Class A: 4,688,611,950 1,198,225,128 131,912,970 6,018,750,048 6,018,750,048
Class B: 585,622,931 -- -- 585,622,931 585,622,931
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II
Fidelity Institutional Cash Portfolios: U.S. Treasury Portfolio and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Statement of Operations
Year Ended March 31, 1995
(Unaudited)
FICP FMMT Pro Forma Pro Forma
Treasury II Treasury Treasury Combined Adjustments Combined
------------ ------------ ------------ ------------ --------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Interest Income $ 212,775,731 $ 63,568,355 $ 7,741,300 $ 284,085,386 $ 284,085,386
------------ ----------- ------------ ------------ ------------
Expenses
Management fee 8,680,344 2,645,934 676,492 12,002,770 (354,500)(a) 11,648,270
Transfer agent fees
Class A 1,278,161 113,703 0 1,391,864 188,500 (b) 1,580,364
Class B 28,447 0 0 28,447 28,447
Distribution fees - Class B 418,917 0 0 418,917 418,917
Accounting fees and expenses 375,762 149,193 0 524,955 (37,900)(c) 487,055
Non-interested trustees' compensation 86,005 47,131 0 133,136 884 (b) 134,020
Custodian fees and expenses 104,003 110,308 0 214,311 35,251 (b) 249,562
Registration fees - Class A 342,613 85,803 0 428,416 23,000 (b) 451,416
Registration fees - Class B 333,235 0 0 333,235 333,235
Audit 31,578 19,247 0 50,825 (2,000)(d) 48,825
Legal 49,903 17,080 0 66,983 2,600 (b) 69,583
Reports to shareholders 1,174 469 0 1,643 1,643
Miscellaneous 40,222 14,760 0 54,982 2,600 (b) 57,582
------------ ----------- ------------ ------------ -----------
Total expenses before reductions 11,770,364 3,203,628 676,492 15,650,484 15,508,919
Expense reductions (3,539,319) (822,285) 0 (4,361,604) 919,876 (e) (3,441,728)
------------ ----------- ------------ ------------ -----------
8,231,045 2,381,343 676,492 11,288,880 12,067,191
------------ ----------- ------------ ------------ -----------
Net interest income 204,544,686 61,187,012 7,064,808 272,796,506 272,018,195
Net realized gain (loss) on investments (367,507) (156,575) (13,755) (537,837) (537,837)
------------ ----------- ------------ ------------ -----------
Net increase in net assets resulting
from operations $ 204,177,179 $ 61,030,437 $ 7,051,053 $ 272,258,669 $ 271,480,358
============ =========== ============ ============ ===========
</TABLE>
<PAGE>
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: TREASURY II
FIDELITY INSTITUTIONAL CASH PORTFOLIOS: U.S. TREASURY PORTFOLIO
FIDELITY MONEY MARKET TRUST: U.S. TREASURY PORTFOLIO
NOTES TO PRO FORMA COMBINED FINANCIAL STATEMENTS
(UNAUDITED)
The accompanying unaudited Pro Forma Combined Schedule of Investments and
Statement of Assets and Liabilities as of March 31, 1995 and the unaudited
Pro Forma Combined Statement of Operations for the year ended March 31,
1995 are intended to present the financial condition and related results
of operations of Fidelity Institutional Cash Portfolios: Treasury II
(Treasury II) as if the reorganization with Fidelity Institutional Cash
Portfolios: U.S. Treasury Portfolio (FICP Treasury) and the reorganization
with Fidelity Money Market Trust: U.S. Treasury Portfolio (FMMT Treasury)
had both been consummated at March 31, 1994.
During the year ended March 31, 1995, Fidelity Management & Research
Company (FMR), investment adviser to the funds, voluntarily agreed to re-
imburse Treasury II for operating expenses (excluding interest, taxes,
brokerage commissions, extraordinary expenses and 12b-1 fees payable by
Class B shares) above an annual rate of .18% of average net assets. Effec-
tive July 1, 1995, FMR increased this expense limitation from .18% to
.20%. The accompanying pro forma financial statements reflect the effects
of both the reorganization and the increase in the expense limitation. Had
the pro forma adjustments not included the effect of the increased expense
limitation, Pro Forma Combined Expense reductions would have been
$(4,606,555), resulting in Pro Forma Combined Net interest income and Pro
Forma Combined Net increase in net assets resulting from operations of
$273,183,022 and $272,645,185, respectively.
The pro forma adjustments to these pro forma financial statements are
comprised of:
(a) Decrease in Management fee due to the change from the all-inclusive
expense contract for FMMT Treasury (annual rate of .42% of average net
assets) to the annual management fee contract rate of .20% of average net
assets for Treasury II.
(b) Increase in other expense items to reflect actual expenses incurred by
FMR under the all-inclusive expense contract for FMMT Treasury. Under the
reorganization, these expenses would have been incurred by Treasury II.
(c) Decrease in Accounting fees and expenses due to reduction in base fee
rate resulting from combined net assets of the three funds.
(d) Decrease in Audit expense to reflect elimination of FICP Treasury.
(e) Decrease in Expense reductions results primarily from the change in
the voluntary expense limitation effective July 1, 1995, net of the effect
resulting from an increase in combined net assets of the three funds.
The unaudited pro forma combined financial statements should be read in
conjunction with the separate annual audited financial statements as of
March 31, 1995 for Treasury II (f/k/a Fidelity Institutional Cash
Portfolios: U.S. Treasury Portfolio II), the separate annual audited
financial statements as of March 31, 1995 for FICP Treasury and the
separate semiannual unaudited financial statements as of February 28, 1995
and the separate annual audited financial statements as of August 31, 1994
for FMMT Treasury, which statements are incorporated by reference in the
Statement of Additional Information to this Proxy Statement and
Prospectus.
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Fidelity Institutional Cash Portfolios: Treasury II,
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited)
Principal Amount
-----------------------------------------------------------------
Combined
Annualized Treasury II,
Due Yield at Time FICP FMMT FICP Treasury
Date of Purchase Treasury II Treasury Treasury & FMMT Treasury
-------- ------------- ------------- ------------- ------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
U.S. Treasury Obligations
U.S. Treasury Bills
4/20/95 5.97% $ 0 $ 259,266,800 $ 28,000,000 $ 287,266,800
5/4/95 5.68% 1,179,000,000 22,000,000 3,000,000 1,204,000,000
7/13/95 6.63% 0 57,000,000 6,000,000 63,000,000
7/13/95 6.64% 192,000,000 0 0 192,000,000
7/27/95 6.40% 116,000,000 28,000,000 4,000,000 148,000,000
8/10/95 6.29% 134,000,000 35,000,000 9,000,000 178,000,000
8/24/95 5.48% 121,000,000 40,000,000 5,000,000 166,000,000
8/31/95 6.19% 145,000,000 42,000,000 3,000,000 190,000,000
U. S. Treasury Notes
4/30/95 5.54% 110,000,000 34,000,000 4,000,000 148,000,000
5/15/95 5.66% 53,000,000 15,000,000 2,000,000 70,000,000
5/15/95 6.23% 54,000,000 15,000,000 2,000,000 71,000,000
5/15/95 6.33% 54,000,000 15,000,000 2,000,000 71,000,000
5/15/95 6.45% 54,000,000 15,000,000 2,000,000 71,000,000
5/15/95 6.46% 57,000,000 15,000,000 1,000,000 73,000,000
TOTAL U.S. TREASURY OBLIGATIONS
Medium-Term Note
Export-Import Bank, U.S. (a)
(as guarantor for K.A.
Leasing Ltd.) 4/15/95 6.25% 0 15,608,350 0 15,608,350
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<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II,
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited) - continued
Maturity Amount
-----------------------------------------------------------------
Combined
Treasury II,
FICP FMMT FICP Treasury
Treasury II Treasury Treasury & FMMT Treasury
-------------- ------------- ------------- -----------------
<S> <C> <C> <C> <C>
Repurchase Agreements
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 0 0 100,051,667
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 0 0 115,060,183
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 0 0 106,055,650
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 0 0 102,042,544
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 0 0 106,055,650
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 0 0 15,007,625
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 0 0 106,055,385
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<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II,
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited) - continued
Maturity Amount
-----------------------------------------------------------------
Combined
Treasury II,
FICP FMMT FICP Treasury
Treasury II Treasury Treasury & FMMT Treasury
------------ ------------- ------------- -----------------
<S> <C> <C> <C> <C>
Repurchase Agreements - continued
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/95, due 4/3/95
At 6.20% $3,149,626,170 $ 0 $ 49,025,312 $ 3,198,651,482
At 6.20% 0 529,273,398 0 529,273,398
At 6.23% 332,298,444 61,699,018 40,467,000 434,464,462
At 6.24% 0 263,319,925 0 263,319,925
TOTAL REPURCHASE AGREEMENTS
TOTAL INVESTMENTS
(a) To conform to the investment limitations of Treasury II, this security will
be sold by FICP Treasury prior to the Closing date of the Reorganization.
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<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II,
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited)
Value
-----------------------------------------------------------------
Combined
Annualized Treasury II,
Due Yield at Time FICP FMMT FICP Treasury
Date of Purchase Treasury II Treasury Treasury & FMMT Treasury
-------- ------------- ------------- ------------- ------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
U.S. Treasury Obligations
U.S. Treasury Bills
4/20/95 5.97% $ 0 $ 259,266,800 $ 27,921,040 $ 287,187,840
5/4/95 5.68% 1,125,643,740 21,888,680 2,984,820 1,150,517,240
7/13/95 6.63% 0 55,953,821 5,889,876 61,843,697
7/13/95 6.64% 188,472,918 0 0 188,472,918
7/27/95 6.40% 113,662,600 27,435,800 3,919,400 145,017,800
8/10/95 6.29% 131,025,573 34,223,097 8,800,225 174,048,895
8/24/95 5.48% 118,465,722 39,161,416 4,895,278 162,522,416
8/31/95 6.19% 141,326,666 40,936,000 2,924,000 185,186,666
------------- ------------ ----------- --------------
1,818,597,219 478,865,614 57,334,639 2,354,797,472
------------- ------------ ----------- --------------
U. S. Treasury Notes
4/30/95 5.54% 109,843,423 33,951,603 3,994,306 147,789,332
5/15/95 5.66% 53,001,423 15,000,403 2,000,053 70,001,879
5/15/95 6.23% 53,973,966 14,992,768 1,999,036 70,965,770
5/15/95 6.33% 53,967,516 14,990,977 1,998,797 70,957,290
5/15/95 6.45% 54,126,086 15,035,024 2,004,670 71,165,780
5/15/95 6.46% 56,955,587 14,988,313 999,221 72,943,121
------------- ------------ ----------- --------------
381,868,001 108,959,088 12,996,083 503,823,172
------------- ------------ ----------- --------------
TOTAL U.S. TREASURY OBLIGATIONS 2,200,465,220 587,824,702 70,330,722 2,858,620,644
------------- ------------ ----------- --------------
Medium-Term Note
Export-Import Bank, U.S. (a)
(as guarantor for K.A.
Leasing, Ltd.) 4/15/95 6.25% 0 15,608,350 0 15,608,350
------------- ------------ ----------- --------------
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<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II,
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited) - continued
Value
-----------------------------------------------------------------
Combined
Treasury II,
FICP FMMT FICP Treasury
Treasury II Treasury Treasury & FMMT Treasury
-------------- ------------- ------------- -----------------
<S> <C> <C> <C> <C>
Repurchase Agreements
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 2/15/23 100,000,000 0 0 100,000,000
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 8/15/08 115,000,000 0 0 115,000,000
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 11/15/24 106,000,000 0 0 106,000,000
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%, 6/29/95 101,989,000 0 0 101,989,000
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 11/15/12 106,000,000 0 0 106,000,000
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 15,000,000 0 0 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 8/15/03 106,000,000 0 0 106,000,000
</TABLE>
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<TABLE>
<CAPTION>
Fidelity Institutional Cash Portfolios: Treasury II,
Fidelity Institutional Cash Portfolios: U. S. Treasury Portfolio and
Fidelity Money Market Trust: U.S. Treasury Portfolio
Pro Forma Combined Schedule of Investments March 31, 1995 (Unaudited) - continued
Value
-----------------------------------------------------------------
Combined
Treasury II,
FICP FMMT FICP Treasury
Treasury II Treasury Treasury & FMMT Treasury
------------ ------------- ------------- -----------------
<S> <C> <C> <C> <C>
Repurchase Agreements - continued
In a joint trading account
(U.S. Treasury Obligations)
dated 3/31/95, due 4/3/95
At 6.20% $ 3,148,000,000 $ 0 $ 49,000,000 $3,197,000,000
At 6.20% 0 529,000,000 0 529,000,000
At 6.23% 332,126,000 61,667,000 40,446,000 434,239,000
At 6.24% 0 263,183,000 0 263,183,000
--------------- -------------- ------------- --------------
TOTAL REPURCHASE AGREEMENTS 4,130,115,000 853,850,000 89,446,000 5,073,411,000
--------------- -------------- ------------- --------------
TOTAL INVESTMENTS $ 6,330,580,220 $1,457,283,052 $ 159,776,722 $7,947,639,994
=============== ============== ============= ==============
(a) To conform to the investment limitations of Treasury II, this security will
be sold by FICP Treasury prior to the Closing date of the Reorganization.
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