SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT (No. 2-21461)
UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 48 [X]
and
REGISTRATION STATEMENT (No. 811-1193)
UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 48 [X]
Fidelity Magellan Fund
(Exact Name of Registrant as Specified in Charter)
82 Devonshire St., Boston, Massachusetts 02109
(Address Of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number: 617-563-7000
Eric D. Roiter, Secretary
82 Devonshire Street
Boston, Massachusetts 02109
(Name and Address of Agent for Service)
It is proposed that this filing will become effective
( ) immediately upon filing pursuant to paragraph (b).
(X) on May 22, 2000 pursuant to paragraph (b).
( ) 60 days after filing pursuant to paragraph (a)(1).
( ) on ( ) pursuant to paragraph (a)(1) of Rule 485.
( ) 75 days after filing pursuant to paragraph (a)(2).
( ) on ( ) pursuant to paragraph (a)(2) of Rule 485.
If appropriate, check the following box:
( ) this post-effective amendment designates a new effective date for
a previously filed post-effective amendment.
Like securities of all mutual
funds, these securities have
not been approved or
disapproved by the
Securities and Exchange
Commission, and the
Securities and Exchange
Commission has not
determined if this
prospectus is accurate or
complete. Any
representation to the
contrary is a criminal
offense.
FIDELITY(REGISTERED TRADEMARK)
MAGELLAN(REGISTERED TRADEMARK)
FUND
(fund number 021, trading symbol FMAGX)
PROSPECTUS
MAY 22, 2000
(FIDELITY_LOGO_GRAPHIC)(registered trademark)
82 DEVONSHIRE STREET, BOSTON, MA 02109
CONTENTS
FUND SUMMARY 3 INVESTMENT SUMMARY
3 PERFORMANCE
4 FEE TABLE
FUND BASICS 5 INVESTMENT DETAILS
6 VALUING SHARES
SHAREHOLDER INFORMATION 6 BUYING AND SELLING SHARES
14 EXCHANGING SHARES
14 ACCOUNT FEATURES AND POLICIES
17 DIVIDENDS AND CAPITAL GAIN
DISTRIBUTIONS
17 TAX CONSEQUENCES
FUND SERVICES 17 FUND MANAGEMENT
18 FUND DISTRIBUTION
APPENDIX 19 FINANCIAL HIGHLIGHTS
21 ADDITIONAL PERFORMANCE
INFORMATION
FUND SUMMARY
INVESTMENT SUMMARY
INVESTMENT OBJECTIVE
MAGELLAN(registered trademark) seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
Fidelity Management & Research Company (FMR)'s principal investment
strategies include:
(small solid bullet) Normally investing primarily in common stocks.
(small solid bullet) Investing in domestic and foreign issuers.
(small solid bullet) Investing in either "growth" stocks or "value"
stocks or both.
(small solid bullet) Using fundamental analysis of each issuer's
financial condition and industry position and market and economic
conditions to select investments.
PRINCIPAL INVESTMENT RISKS
The fund is subject to the following principal investment risks:
(small solid bullet) STOCK MARKET VOLATILITY. Stock markets are
volatile and can decline significantly in response to adverse issuer,
political, regulatory, market or economic developments. Different
parts of the market can react differently to these developments.
(small solid bullet) FOREIGN EXPOSURE. Foreign markets can be more
volatile than the U.S. market due to increased risks of adverse
issuer, political, regulatory, market or economic developments and can
perform differently from the U.S. market.
(small solid bullet) ISSUER-SPECIFIC CHANGES. The value of an
individual security or particular type of security can be more
volatile than the market as a whole and can perform differently from
the value of the market as a whole.
An investment in the fund is not a deposit of a bank and is not
insured or guaranteed by the Federal Deposit Insurance Corporation or
any other government agency.
When you sell your shares of the fund, they could be worth more or
less than what you paid for them.
PERFORMANCE
The following information illustrates the changes in the fund's
performance from year to year and compares the fund's performance to
the performance of a market index and an average of the performance of
similar funds over various periods of time. Returns are based on past
results and are not an indication of future performance.
YEAR-BY-YEAR RETURNS
The returns in the chart do not include the effect of Magellan's
front-end sales charge. If the effect of the sales charge were
reflected, returns would be lower than those shown.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
MAGELLAN
Calendar Years 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
-4.51% 41.03% 7.01% 24.66% -1.81% 36.82% 11.69% 26.59% 33.63% 24.05%
</TABLE>
Percentage (%)
Row: 1, Col: 1, Value: -4.51
Row: 2, Col: 1, Value: 41.03
Row: 3, Col: 1, Value: 7.01
Row: 4, Col: 1, Value: 24.66
Row: 5, Col: 1, Value: -1.81
Row: 6, Col: 1, Value: 36.82
Row: 7, Col: 1, Value: 11.69
Row: 8, Col: 1, Value: 26.59
Row: 9, Col: 1, Value: 33.63
Row: 10, Col: 1, Value: 24.05
DURING THE PERIODS SHOWN IN THE CHART FOR MAGELLAN, THE HIGHEST RETURN
FOR A QUARTER WAS 27.22 % (QUARTER ENDED DECEMBER 31,
1998 ) AND THE LOWEST RETURN FOR A QUARTER WAS -16.48 %
(QUARTER ENDED SEPTEMBER 30, 1990 ).
THE YEAR-TO-DATE RETURN AS OF MARCH 31, 2000 FOR MAGELLAN WAS
4.85 %.
AVERAGE ANNUAL RETURNS
The returns in the following table include the effect of the fund's
3.00% maximum applicable front-end sales charge.
For the periods ended Past 1 year Past 5 years Past 10 years
December 31, 1999
Magellan 20.32% 25.48% 18.56%
S&P 500(registered trademark) 21.04% 28.56% 18.21%
Lipper Growth Funds Average 29.27% 25.04% 16.52%
Standard & Poor's 500 Index SM (S&P 500(registered trademark)) is a
market capitalization-weighted index of common stocks.
The Lipper Funds Average reflects the performance (excluding sales
charges) of mutual funds with similar objectives.
FEE TABLE
The following table describes the fees and expenses that are incurred
when you buy, hold, or sell shares of the fund. T he annual fund
operating expenses provided below for the fund do not reflect the
effect of any reduction of certain expenses during the period .
SHAREHOLDER FEES (PAID BY THE INVESTOR DIRECTLY)
Maximum sales charge (load) 3.00%A
on purchases (as a % of
offering price)
Sales charge (load) on None
reinvested distributions
Deferred sales charge (load) None
on redemptions
Annual account maintenance $ 12.00
fee (for accounts under
$2,500)
A LOWER SALES CHARGES MAY BE AVAILABLE FOR ACCOUNTS OVER $250,000.
ANNUAL FUND OPERATING EXPENSES (PAID FROM FUND ASSETS)
Management fee 0.57%
Distribution and Service None
(12b-1) fee
Other expenses 0.18%
Total annual fund operating 0.75%
expenses
A portion of the brokerage commissions that the fund pays is used to
reduce the fund's expenses. In addition, through arrangements with the
fund's custodian and transfer agent, credits realized as a result of
uninvested cash balances are used to reduce custodian and transfer
agent expenses. Including these reductions, the total fund operating
expenses would have been 0.74 %.
This EXAMPLE helps you compare the cost of investing in the fund with
the cost of investing in other mutual funds.
Let's say, hypothetically, that the fund's annual return is 5% and
that your shareholder fees and the fund's annual operating expenses
are exactly as described in the fee table. This example illustrates
the effect of fees and expenses, but is not meant to suggest actual or
expected fees and expenses or returns, all of which may vary. For
every $10,000 you invested, here's how much you would pay in total
expenses if you close your account at the end of each time period
indicated:
1 year $ 374
3 years $ 532
5 years $ 704
10 years $ 1,202
FUND BASICS
INVESTMENT DETAILS
INVESTMENT OBJECTIVE
MAGELLAN seeks capital appreciation.
PRINCIPAL INVESTMENT STRATEGIES
FMR normally invests the fund's assets primarily in common stocks.
FMR may invest the fund's assets in securities of foreign issuers in
addition to securities of domestic issuers.
FMR is not constrained by any particular investment style. At any
given time, FMR may tend to buy "growth" stocks or "value" stocks, or
a combination of both types. In buying and selling securities for the
fund, FMR relies on fundamental analysis of each issuer and its
potential for success in light of its current financial condition, its
industry position, and economic and market conditions. Factors
considered include growth potential, earnings estimates, and
management.
FMR may lend the fund's securities to broker-dealers or other
institutions to earn income for the fund.
FMR may use various techniques, such as buying and selling futures
contracts, to increase or decrease the fund's exposure to changing
security prices or other factors that affect security values. If FMR's
strategies do not work as intended, the fund may not achieve its
objective.
DESCRIPTION OF PRINCIPAL SECURITY TYPES
EQUITY SECURITIES represent an ownership interest, or the right to
acquire an ownership interest, in an issuer. Different types of equity
securities provide different voting and dividend rights and priority
in the event of the bankruptcy of the issuer. Equity securities
include common stocks, preferred stocks, convertible securities, and
warrants.
PRINCIPAL INVESTMENT RISKS
Many factors affect the fund's performance. The fund's share price
changes daily based on changes in market conditions and interest rates
and in response to other economic, political, or financial
developments. The fund's reaction to these developments will be
affected by the types of securities in which the fund invests, the
financial condition, industry and economic sector, and geographic
location of an issuer, and the fund's level of investment in the
securities of that issuer. When you sell your shares of the fund, they
could be worth more or less than what you paid for them.
The following factors can significantly affect the fund's performance:
STOCK MARKET VOLATILITY. The value of equity securities fluctuates in
response to issuer, political, market, and economic developments. In
the short term, equity prices can fluctuate dramatically in response
to these developments. Different parts of the market and different
types of equity securities can react differently to these
developments. For example, large cap stocks can react differently from
small cap stocks, and "growth" stocks can react differently from
"value" stocks. Issuer, political, or economic developments can affect
a single issuer, issuers within an industry or economic sector or
geographic region, or the market as a whole.
FOREIGN EXPOSURE. Foreign securities, foreign currencies, and
securities issued by U.S. entities with substantial foreign operations
can involve additional risks relating to political, economic, or
regulatory conditions in foreign countries. These risks include
fluctuations in foreign currencies; withholding or other taxes;
trading, settlement, custodial, and other operational risks; and the
less stringent investor protection and disclosure standards of some
foreign markets. All of these factors can make foreign investments,
especially those in emerging markets, more volatile and potentially
less liquid than U.S. investments. In addition, foreign markets can
perform differently from the U.S. market.
ISSUER-SPECIFIC CHANGES. Changes in the financial condition of an
issuer, changes in specific economic or political conditions that
affect a particular type of security or issuer, and changes in general
economic or political conditions can affect the value of an issuer's
securities. The value of securities of smaller, less well-known
issuers can be more volatile than that of larger issuers.
In response to market, economic, political, or other conditions, FMR
may temporarily use a different investment strategy for defensive
purposes. If FMR does so, different factors could affect the fund's
performance and the fund may not achieve its investment objective.
FUNDAMENTAL INVESTMENT POLICIES
The policies discussed below are fundamental, that is, subject to
change only by shareholder approval.
MAGELLAN FUND seeks capital appreciation through investments in
securities of domestic, foreign, and multinational issuers. The fund
normally invests primarily in common stock and securities convertible
into common stock, but may also invest in other types of securities in
seeking its objective. No more than 40% of the fund's assets may be
invested in companies operating exclusively in any one foreign
country. No emphasis is placed on dividend income except when FMR
believes this income will have a favorable influence on the market
value of the security.
VALUING SHARES
The fund is open for business each day the New York Stock Exchange
(NYSE) is open.
The fund's net asset value per share (NAV) is the value of a single
share. Fidelity normally calculates the fund's NAV as of the close of
business of the NYSE, normally 4:00 p.m. Eastern time. However, NAV
may be calculated earlier if trading on the NYSE is restricted or as
permitted by the Securities and Exchange Commission (SEC). The fund's
assets are valued as of this time for the purpose of computing the
fund's NAV.
To the extent that the fund's assets are traded in other markets on
days when the NYSE is closed, the value of the fund's assets may be
affected on days when the fund is not open for business. In addition,
trading in some of the fund's assets may not occur on days when the
fund is open for business.
The fund's assets are valued primarily on the basis of market
quotations. Certain short-term securities are valued on the basis of
amortized cost. If market quotations are not readily available for a
security or if a security's value has been materially affected by
events occurring after the close of the exchange or market on which
the security is principally traded (for example, a foreign exchange or
market), that security may be valued by another method that the Board
of Trustees believes accurately reflects fair value. A security's
valuation may differ depending on the method used for determining
value.
SHAREHOLDER INFORMATION
BUYING AND SELLING SHARES
GENERAL INFORMATION
Fidelity Investments(registered trademark) was established in 1946 to
manage one of America's first mutual funds. Today, Fidelity is the
largest mutual fund company in the country, and is known as an
innovative provider of high-quality financial services to individuals
and institutions.
In addition to its mutual fund business, the company operates one of
America's leading discount brokerage firms, Fidelity Brokerage
Services, Inc. (FBSI). Fidelity is also a leader in providing
tax-advantaged retirement plans for individuals investing on their own
or through their employer.
For account, product and service information, please use the following
web site and phone numbers:
(small solid bullet) For information over the Internet, visit
Fidelity's web site at www.fidelity.com.
(small solid bullet) For accessing account information automatically
by phone, use Fidelity Automated Service Telephone (FAST (registered
trademark) ), 1-800-544-5555.
(small solid bullet) For exchanges, redemptions, and account
assistance, 1-800-544-6666.
(small solid bullet) For mutual fund and brokerage information,
1-800-544-6666.
(small solid bullet) For retirement information, 1-800-544-4774.
(small solid bullet) TDD - Service for the Deaf and Hearing-Impaired,
1-800-544-0118 (9:00 a.m. - 9:00 p.m. Eastern time).
Please use the following addresses:
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
OVERNIGHT EXPRESS
Fidelity Investments
2300 Litton Lane - KH1A
Hebron, KY 41048
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6I
400 East Las Colinas Blvd.
Irving, TX 75039-5587
You may buy or sell shares of the fund through a retirement account or
an investment professional. If you invest through a retirement account
or an investment professional, the procedures for buying, selling, and
exchanging shares of the fund and the account features and policies
may differ. Additional fees may also apply to your investment in the
fund, including a transaction fee if you buy or sell shares of the
fund through a broker or other investment professional.
Certain methods of contacting Fidelity, such as by telephone or
electronically, may be unavailable or delayed (for example, during
periods of unusual market activity). In addition, the level and type
of service available may be restricted based on criteria established
by Fidelity.
The different ways to set up (register) your account with Fidelity are
listed in the following table.
WAYS TO SET UP YOUR ACCOUNT
INDIVIDUAL OR JOINT TENANT
FOR YOUR GENERAL INVESTMENT NEEDS
RETIREMENT
FOR TAX-ADVANTAGED RETIREMENT SAVINGS
(solid bullet) TRADITIONAL INDIVIDUAL RETIREMENT ACCOUNTS (IRAS)
(solid bullet) ROTH IRAS
(solid bullet) ROLLOVER IRAS
(solid bullet) 401(K) PLANS AND CERTAIN OTHER 401(A)-QUALIFIED PLANS
(solid bullet) KEOGH PLANS
(solid bullet) SIMPLE IRAS
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS)
(solid bullet) SALARY REDUCTION SEP-IRAS (SARSEPS)
(solid bullet) 403(B) CUSTODIAL ACCOUNTS
(solid bullet) DEFERRED COMPENSATION PLANS (457 PLANS)
GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA)
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS
TRUST
FOR MONEY BEING INVESTED BY A TRUST
BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS OR
OTHER GROUPS
BUYING SHARES
Effective the close of business on September 30, 1997, the fund's
shares are no longer available to new accounts. Shareholders of the
fund on that date may continue to buy shares in accounts existing on
that date. Investors who did not own shares of the fund on September
30, 1997, generally will not be allowed to buy shares of the fund
except that new accounts may be established: 1) by participants in
most group employer retirement plans (and their successor plans) if
the fund had been established as an investment option under the plans
(or under another plan sponsored by the same employer) by September
30, 1997, and 2) for accounts managed on a discretionary basis by
certain registered investment advisers that have discretionary assets
of at least $500 million invested in mutual funds and have included
the fund in their discretionary account program since September 30,
1997. These restrictions generally will apply to investments made
directly with Fidelity and investments made through intermediaries.
Investors may be required to demonstrate eligibility to buy shares of
the fund before an investment is accepted.
The price to buy one share of the fund is the fund's offering price or
the fund's NAV, depending on whether you pay a sales charge.
If you pay a sales charge, your price will be the fund's offering
price. When you buy shares of the fund at the offering price, Fidelity
deducts the appropriate sales charge and invests the rest in the fund.
If you qualify for a sales charge waiver, your price will be the
fund's NAV.
The offering price of the fund is its NAV divided by the difference
between one and the applicable sales charge percentage. The maximum
sales charge is 3.00% of the offering price.
Your shares will be bought at the next offering price or NAV, as
applicable, calculated after your investment is received in proper
form.
Short-term or excessive trading into and out of the fund may harm
performance by disrupting portfolio management strategies and by
increasing expenses. Accordingly, the fund may reject any purchase
orders, including exchanges, particularly from market timers or
investors who, in FMR's opinion, have a pattern of short-term or
excessive trading or whose trading has been or may be disruptive to
the fund. For these purposes, FMR may consider an investor's trading
history in the fund or other Fidelity funds, and accounts under common
ownership or control.
The fund may stop offering shares completely or may offer shares only
on a limited basis, for a period of time or permanently.
When you place an order to buy shares, note the following:
(small solid bullet) All of your purchases must be made in U.S.
dollars and checks must be drawn on U.S. banks.
(small solid bullet) Fidelity does not accept cash.
(small solid bullet) When making a purchase with more than one check,
each check must have a value of at least $50.
(small solid bullet) Fidelity reserves the right to limit the number
of checks processed at one time.
(small solid bullet) If your check does not clear, your purchase will
be canceled and you could be liable for any losses or fees the fund or
Fidelity has incurred.
Certain financial institutions that have entered into sales agreements
with Fidelity Distributors Corporation (FDC) may enter confirmed
purchase orders on behalf of customers by phone, with payment to
follow no later than the time when the fund is priced on the following
business day. If payment is not received by that time, the order will
be canceled and the financial institution could be held liable for
resulting fees or losses.
MINIMUMS
TO OPEN AN ACCOUNT $2,500
For certain Fidelity retirement accountsA $500
TO ADD TO AN ACCOUNT $250
Through regular investment plans $100
MINIMUM BALANCE $2,000
For certain Fidelity retirement accountsA $500
A FIDELITY TRADITIONAL IRA, ROTH IRA, ROLLOVER IRA, SEP-IRA, AND KEOGH
ACCOUNTS.
There is no minimum account balance or initial or subsequent purchase
minimum for investments through Fidelity Portfolio Advisory Services
SM, a qualified state tuition program, certain Fidelity retirement
accounts funded through salary deduction, or accounts opened with the
proceeds of distributions from such retirement accounts. In addition,
the fund may waive or lower purchase minimums in other circumstances.
KEY INFORMATION
PHONE 1-800-544-6666 TO OPEN AN ACCOUNT
(small solid bullet) Exchange
from another Fidelity fund.
Call the phone number at left.
TO ADD TO AN ACCOUNT
(small solid bullet) Exchange
from another Fidelity fund.
Call the phone number at left.
(small solid bullet) Use
Fidelity Money
Line(registered trademark)
to transfer from your bank
account.
INTERNET WWW.FIDELITY.COM TO OPEN AN ACCOUNT
(small solid bullet) Complete
and sign the application.
Make your check payable to
the complete name of the
fund. Mail to the address
under "Mail" below.
TO ADD TO AN ACCOUNT
(small solid bullet) Exchange
from another Fidelity fund.
(small solid bullet) Use
Fidelity Money Line to
transfer from your bank
account.
MAIL FIDELITY INVESTMENTS TO OPEN AN ACCOUNT
P.O. BOX 770001 CINCINNATI, (small solid bullet) Complete
OH 45277-0002 and sign the application.
Make your check payable to
the complete name of the
fund. Mail to the address at
left.
TO ADD TO AN ACCOUNT
(small solid bullet) Make
your check payable to the
complete name of the fund.
Indicate your fund account
number on your check and
mail to the address at left.
(small solid bullet) Exchange
from another Fidelity fund.
Send a letter of instruction
to the address at left,
including your name, the
funds' names, the fund
account numbers, and the
dollar amount or number of
shares to be exchanged.
IN PERSON TO OPEN AN ACCOUNT
(small solid bullet) Bring
your application and check
to a Fidelity Investor
Center. Call 1-800-544-9797
for the center nearest you.
TO ADD TO AN ACCOUNT
(small solid bullet) Bring
your check to a Fidelity
Investor Center. Call
1-800-544-9797 for the
center nearest you.
WIRE TO OPEN AN ACCOUNT
(small solid bullet) Call
1-800-544-6666 to set up
your account and to arrange
a wire transaction.
(small solid bullet) Wire
within 24 hours to: Bankers
Trust Company, Bank Routing
# 021001033, Account #
00163053.
(small solid bullet) Specify
the complete name of the
fund and include your new
fund account number and your
name.
TO ADD TO AN ACCOUNT
(small solid bullet) Wire to:
Bankers Trust Company, Bank
Routing # 021001033, Account
# 00163053.
(small solid bullet) Specify
the complete name of the
fund and include your fund
account number and your name.
AUTOMATICALLY TO OPEN AN ACCOUNT
(small solid bullet) Not
available.
TO ADD TO AN ACCOUNT
(small solid bullet) Use
Fidelity Automatic Account
Builder(registered
trademark) or Direct Deposit.
(small solid bullet) Use
Fidelity Automatic Exchange
Service to exchange from a
Fidelity money market fund.
SELLING SHARES
The price to sell one share of the fund is the fund's NAV.
Your shares will be sold at the next NAV calculated after your order
is received in proper form.
Certain requests must include a signature guarantee. It is designed to
protect you and Fidelity from fraud. Your request must be made in
writing and include a signature guarantee if any of the following
situations apply:
(small solid bullet) You wish to sell more than $100,000 worth of
shares;
(small solid bullet) Your account registration has changed within the
last 15 or 30 days, depending on your account;
(small solid bullet) The check is being mailed to a different address
than the one on your account (record address);
(small solid bullet) The check is being made payable to someone other
than the account owner; or
(small solid bullet) The redemption proceeds are being transferred to
a Fidelity account with a different registration.
You should be able to obtain a signature guarantee from a bank, broker
(including Fidelity Investor Centers), dealer, credit union (if
authorized under state law), securities exchange or association,
clearing agency, or savings association. A notary public cannot
provide a signature guarantee.
When you place an order to sell shares, note the following:
(small solid bullet) If you are selling some but not all of your
shares, leave at least $2,000 worth of shares in the account to keep
it open ($500 for retirement accounts), except accounts not subject to
account minimums.
(small solid bullet) Normally, Fidelity will process redemptions by
the next business day, but Fidelity may take up to seven days to
process redemptions if making immediate payment would adversely affect
the fund.
(small solid bullet) Redemption proceeds (other than exchanges) may be
delayed until money from prior purchases sufficient to cover your
redemption has been received and collected. This can take up to seven
business days after a purchase.
(small solid bullet) Remember to keep shares in your account to be
eligible to purchase additional shares of the fund.
(small solid bullet) Redemptions may be suspended or payment dates
postponed when the NYSE is closed (other than weekends or holidays),
when trading on the NYSE is restricted, or as permitted by the SEC.
(small solid bullet) Redemption proceeds may be paid in securities or
other property rather than in cash if FMR determines it is in the best
interests of the fund.
(small solid bullet) You will not receive interest on amounts
represented by uncashed redemption checks.
(small solid bullet) Unless otherwise instructed, Fidelity will send a
check to the record address.
To sell shares issued with certificates, call Fidelity for
instructions. The fund no longer issues share certificates.
KEY INFORMATION
PHONE 1-800-544-6666 (small solid bullet) Call the
phone number at left to
initiate a wire transaction
or to request a check for
your redemption.
(small solid bullet) Use
Fidelity Money Line to
transfer to your bank account.
(small solid bullet) Exchange
to another Fidelity fund.
Call the phone number at left.
INTERNET WWW.FIDELITY.COM (small solid bullet) Exchange
to another Fidelity fund.
(small solid bullet) Use
Fidelity Money Line to
transfer to your bank account.
MAIL FIDELITY INVESTMENTS INDIVIDUAL, JOINT TENANT,
P.O. BOX 660602 DALLAS, TX SOLE PROPRIETORSHIP, UGMA,
75266-0602 UTMA
(small solid bullet) Send a
letter of instruction to the
address at left, including
your name, the fund's name,
your fund account number,
and the dollar amount or
number of shares to be sold.
The letter of instruction
must be signed by all
persons required to sign for
transactions, exactly as
their names appear on the
account.
RETIREMENT ACCOUNT
(small solid bullet) The
account owner should
complete a retirement
distribution form. Call
1-800-544-6666 to request one.
TRUST
(small solid bullet) Send a
letter of instruction to the
address at left, including
the trust's name, the fund's
name, the trust's fund
account number, and the
dollar amount or number of
shares to be sold. The
trustee must sign the letter
of instruction indicating
capacity as trustee. If the
trustee's name is not in the
account registration,
provide a copy of the trust
document certified within
the last 60 days.
BUSINESS OR ORGANIZATION
(small solid bullet) Send a
letter of instruction to the
address at left, including
the firm's name, the fund's
name, the firm's fund
account number, and the
dollar amount or number of
shares to be sold. At least
one person authorized by
corporate resolution to act
on the account must sign the
letter of instruction.
(small solid bullet) Include
a corporate resolution with
corporate seal or a
signature guarantee.
EXECUTOR, ADMINISTRATOR,
CONSERVATOR, GUARDIAN
(small solid bullet) Call
1-800-544-6666 for
instructions.
IN PERSON INDIVIDUAL, JOINT TENANT,
SOLE PROPRIETORSHIP, UGMA,
UTMA
(small solid bullet) Bring a
letter of instruction to a
Fidelity Investor Center.
Call 1-800-544-9797 for the
center nearest you. The
letter of instruction must
be signed by all persons
required to sign for
transactions, exactly as
their names appear on the
account.
RETIREMENT ACCOUNT
(small solid bullet) The
account owner should
complete a retirement
distribution form. Visit a
Fidelity Investor Center to
request one. Call
1-800-544-9797 for the
center nearest you.
TRUST
(small solid bullet) Bring a
letter of instruction to a
Fidelity Investor Center.
Call 1-800-544-9797 for the
center nearest you. The
trustee must sign the letter
of instruction indicating
capacity as trustee. If the
trustee's name is not in the
account registration,
provide a copy of the trust
document certified within
the last 60 days.
BUSINESS OR ORGANIZATION
(small solid bullet) Bring a
letter of instruction to a
Fidelity Investor Center.
Call 1-800-544-9797 for the
center nearest you. At least
one person authorized by
corporate resolution to act
on the account must sign the
letter of instruction.
(small solid bullet) Include
a corporate resolution with
corporate seal or a
signature guarantee.
EXECUTOR, ADMINISTRATOR,
CONSERVATOR, GUARDIAN
(small solid bullet) Visit a
Fidelity Investor Center for
instructions. Call
1-800-544-9797 for the
center nearest you.
AUTOMATICALLY (small solid bullet) Use
Personal Withdrawal Service
to set up periodic
redemptions from your account.
EXCHANGING SHARES
An exchange involves the redemption of all or a portion of the shares
of one fund and the purchase of shares of another fund.
As a shareholder, you have the privilege of exchanging shares of the
fund for shares of other Fidelity funds.
However, you should note the following policies and restrictions
governing exchanges:
(small solid bullet) The fund you are exchanging into must be
available for sale in your state.
(small solid bullet) You may exchange only 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) The fund may temporarily or permanently terminate
the exchange privilege of any investor who makes more than four
exchanges out of the fund per calendar year. Accounts under common
ownership or control will be counted together for purposes of the four
exchange limit.
(small solid bullet) The exchange limit may be modified for accounts
held by certain institutional retirement plans to conform to plan
exchange limits and Department of Labor regulations. See your plan
materials for further information.
(small solid bullet) The fund may 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.
The fund may terminate or modify the exchange privilege in the future.
Other funds may have different exchange restrictions, and may impose
trading fees of up to 2 .00% of the amount exchanged. Check each
fund's prospectus for details.
ACCOUNT FEATURES AND POLICIES
FEATURES
The following features are available to buy and sell shares of the
fund.
AUTOMATIC INVESTMENT AND WITHDRAWAL PROGRAMS. Fidelity offers
convenient services that let you automatically transfer money into
your account, between accounts, or out of your account. While
automatic investment programs do not guarantee a profit and will not
protect you against loss in a declining market, they can be an
excellent way to invest for retirement, a home, educational expenses,
and other long-term financial goals. Automatic withdrawal or exchange
programs can be a convenient way to provide a consistent income flow
or to move money between your investments.
<TABLE>
<CAPTION>
<S> <C> <C>
FIDELITY AUTOMATIC ACCOUNT
BUILDER TO MOVE MONEY FROM
YOUR BANK ACCOUNT TO A
FIDELITY FUND.
MINIMUM FREQUENCY PROCEDURES
$100 Monthly or quarterly (small solid bullet) To set
up for a new account,
complete the appropriate
section on the fund
application.
(small solid bullet) To set
up for existing accounts,
call 1-800-544-6666 or visit
Fidelity's web site for an
application.
(small solid bullet) To make
changes, call 1-800-544-6666
at least three business days
prior to your next scheduled
investment date.
DIRECT DEPOSIT TO SEND ALL OR
A PORTION OF YOUR PAYCHECK
OR GOVERNMENT CHECK TO A
FIDELITY FUND.A
MINIMUM FREQUENCY PROCEDURES
$100 Every pay period (small solid bullet) To set
up for a new account, check
the appropriate box on the
fund application.
(small solid bullet) To set
up for an existing account,
call 1-800-544-6666 or visit
Fidelity's web site for an
authorization form.
(small solid bullet) To make
changes you will need a new
authorization form. Call
1-800-544-6666 or visit
Fidelity's web site to
obtain one.
A BECAUSE ITS SHARE PRICE
FLUCTUATES, THE FUND MAY NOT
BE AN APPROPRIATE CHOICE FOR
DIRECT DEPOSIT OF YOUR
ENTIRE CHECK.
FIDELITY AUTOMATIC EXCHANGE
SERVICE TO MOVE MONEY FROM A
FIDELITY MONEY MARKET FUND
TO ANOTHER FIDELITY FUND.
MINIMUM FREQUENCY PROCEDURES
$100 Monthly, bimonthly, (small solid bullet) To set
quarterly, or annually up, call 1-800-544-6666
after both accounts are
opened.
(small solid bullet) To make
changes, call 1-800-544-6666
at least three business days
prior to your next scheduled
exchange date.
</TABLE>
PERSONAL WITHDRAWAL SERVICE
TO SET UP PERIODIC
REDEMPTIONS FROM YOUR
ACCOUNT TO YOU OR TO YOUR
BANK ACCOUNT.
FREQUENCY PROCEDURES
Monthly (small solid bullet) To set
up, call 1-800-544-6666.
(small solid bullet) To make
changes, call Fidelity at
1-800-544-6666 at least
three business days prior to
your next scheduled
withdrawal date.
(small solid bullet) Because
of Magellan's front-end
sales charge, you may not
want to set up a systematic
withdrawal program when you
are buying Magellan shares
on a regular basis.
OTHER FEATURES. The following other features are also available to buy
and sell shares of the fund.
WIRE
TO PURCHASE AND SELL SHARES VIA THE FEDERAL RESERVE WIRE SYSTEM.
(small solid bullet) You must sign up for the wire feature before
using it. Complete the appropriate section on the application when
opening your account, or call 1-800-544-6666 to add the feature after
your account is opened. Call 1-800-544-6666 before your first use to
verify that this feature is set up on your account.
(small solid bullet) To sell shares by wire, you must designate the
U.S. commercial bank account(s) into which you wish the redemption
proceeds deposited.
FIDELITY MONEY LINE
TO TRANSFER MONEY BETWEEN YOUR BANK ACCOUNT AND YOUR FUND ACCOUNT.
(small solid bullet) You must sign up for the Money Line feature
before using it. Complete the appropriate section on the application
and then call 1-800-544-6666 or visit Fidelity's web site before your
first use to verify that this feature is set up on your account.
(small solid bullet) Most transfers are complete within three business
days of your call.
(small solid bullet) Minimum purchase: $100
(small solid bullet) Maximum purchase: $100,000
FIDELITY ON-LINE XPRESS+(registered trademark)
TO MANAGE YOUR INVESTMENTS THROUGH YOUR PC.
CALL 1-800-544-0240 OR VISIT FIDELITY'S WEB SITE FOR MORE INFORMATION.
(small solid bullet) For account balances and holdings;
(small solid bullet) To review recent account history;
(small solid bullet) For mutual fund and brokerage trading; and
(small solid bullet) For access to research and analysis tools.
FIDELITY ONLINE TRADING
TO ACCESS AND MANAGE YOUR ACCOUNT OVER THE INTERNET AT FIDELITY'S WEB
SITE.
(small solid bullet) For account balances and holdings;
(small solid bullet) To review recent account history;
(small solid bullet) To obtain quotes;
(small solid bullet) For mutual fund and brokerage trading; and
(small solid bullet) To access third-party research on companies,
stocks, mutual funds and the market.
FAST
TO ACCESS AND MANAGE YOUR ACCOUNT AUTOMATICALLY BY PHONE USING TOUCH
TONE OR SPEECH RECOGNITION.
CALL 1-800-544-5555.
(small solid bullet) For account balances and holdings;
(small solid bullet) For mutual fund and brokerage trading;
(small solid bullet) To obtain quotes;
(small solid bullet) To review orders and mutual fund activity; and
(small solid bullet) To change your personal identification number
(PIN).
POLICIES
The following policies apply to you as a shareholder.
STATEMENTS AND REPORTS that Fidelity sends to you include the
following:
(small solid bullet) Confirmation statements (after transactions
affecting your account balance except reinvestment of distributions in
the fund or another fund and certain transactions through automatic
investment or withdrawal programs).
(small solid bullet) Monthly or quarterly account statements
(detailing account balances and all transactions completed during the
prior month or quarter).
(small solid bullet) Financial reports (every six months).
To reduce expenses, only one copy of most financial reports and
prospectuses will be mailed to your household, even if you have more
than one account in the fund. Call Fidelity at 1-800-544-8544 if you
need additional copies of financial reports or prospectuses.
Electronic copies of most financial reports and prospectuses are
available at Fidelity's web site. To participate in Fidelity's
electronic delivery program, call Fidelity or visit Fidelity's web
site for more information.
You may initiate many TRANSACTIONS BY TELEPHONE OR ELECTRONICALLY.
Fidelity will not be responsible for any losses resulting from
unauthorized transactions if it follows reasonable security procedures
designed to verify the identity of the investor. Fidelity will request
personalized security codes or other information, and may also record
calls. For transactions conducted through the Internet, Fidelity
recommends the use of an Internet browser with 128-bit encryption. You
should verify the accuracy of your confirmation statements immediately
after you receive them. If you do not want the ability to sell and
exchange by telephone, call Fidelity for instructions.
When you sign your ACCOUNT APPLICATION, you will be asked to certify
that your social security or taxpayer identification number is correct
and that you are not subject to 31% backup withholding for failing to
report income to the IRS. If you violate IRS regulations, the IRS can
require the fund to withhold 31% of your taxable distributions and
redemptions.
Fidelity may deduct an ANNUAL MAINTENANCE FEE of $12.00 from accounts
with a value of less than $2,500 (including any amount paid as a sales
charge), subject to an annual maximum charge of $24.00 per
shareholder. It is expected that accounts will be valued on the second
Friday in November of each year. Accounts opened after September 30
will not be subject to the fee for that year. The fee, which is
payable to Fidelity, is designed to offset in part the relatively
higher costs of servicing smaller accounts. This fee will not be
deducted from Fidelity brokerage accounts, retirement accounts (except
non-prototype retirement accounts), accounts using regular investment
plans, or if total assets with Fidelity exceed $30,000. Eligibility
for the $30,000 waiver is determined by aggregating accounts with
Fidelity maintained by Fidelity Service Company, Inc. or FBSI which
are registered under the same social security number or which list the
same social security number for the custodian of a Uniform
Gifts/Transfers to Minors Act account.
If your ACCOUNT BALANCE falls below $2,000 (except accounts not
subject to account minimums), you will be given 30 days' notice to
reestablish the minimum balance. If you do not increase your balance,
Fidelity may close your account and send the proceeds to you. Your
shares will be sold at the NAV on the day your account is closed.
Fidelity may charge a FEE FOR CERTAIN SERVICES, such as providing
historical account documents.
DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS
The fund earns dividends, interest, and other income from its
investments, and distributes this income (less expenses) to
shareholders as dividends. The fund also realizes capital gains from
its investments, and distributes these gains (less any losses) to
shareholders as capital gain distributions.
The fund normally pays dividends and capital gain distributions in May
and December.
DISTRIBUTION OPTIONS
When you open an account, specify on your application how you want to
receive your distributions. The following options may be available for
the fund's distributions:
1. REINVESTMENT OPTION. Your dividends and capital gain distributions
will be automatically reinvested in additional shares of the fund. If
you do not indicate a choice on your application, you will be assigned
this option.
2. INCOME-EARNED OPTION. Your capital gain distributions will be
automatically reinvested in additional shares of the fund. Your
dividends will be paid in cash.
3. CASH OPTION. Your dividends and capital gain distributions will be
paid in cash.
4. DIRECTED DIVIDENDS(registered trademark) OPTION. Your dividends
will be automatically invested in shares of another identically
registered Fidelity fund. Your capital gain distributions will be
automatically invested in shares of another identically registered
Fidelity fund, automatically reinvested in additional shares of the
fund, or paid in cash.
Not all distribution options are available for every account. If the
option you prefer is not listed on your account application, or if you
want to change your current option, call Fidelity.
If you elect to receive distributions paid in cash by check and the
U.S. Postal Service does not deliver your checks, your distribution
option may be converted to the Reinvestment Option. You will not
receive interest on amounts represented by uncashed distribution
checks.
TAX CONSEQUENCES
As with any investment, your investment in the fund could have tax
consequences for you. If you are not investing through a
tax-advantaged retirement account, you should consider these tax
consequences.
TAXES ON DISTRIBUTIONS. Distributions you receive from the fund are
subject to federal income tax, and may also be subject to state or
local taxes.
For federal tax purposes, the fund's dividends and distributions of
short-term capital gains are taxable to you as ordinary income, while
the fund's distributions of long-term capital gains are taxable to you
generally as capital gains.
If you buy shares when a fund has realized but not yet distributed
income or capital gains, you will be "buying a dividend" by paying the
full price for the shares and then receiving a portion of the price
back in the form of a taxable distribution.
Any taxable distributions you receive from the fund will normally be
taxable to you when you receive them, regardless of your distribution
option.
TAXES ON TRANSACTIONS. Your redemptions, including exchanges, may
result in a capital gain or loss for federal tax purposes. A capital
gain or loss on your investment in the fund generally is the
difference between the cost of your shares and the price you receive
when you sell them.
FUND SERVICES
FUND MANAGEMENT
Magellan is a mutual fund, an investment that pools shareholders'
money and invests it toward a specified goal.
FMR is the fund's manager.
As of March 31, 2000 , FMR had approximately $639.1
billion in discretionary assets under management.
As the manager, FMR is responsible for choosing the fund's investments
and handling its business affairs.
Affiliates assist FMR with foreign investments:
(small solid bullet) Fidelity Management & Research (U.K.) Inc. (FMR
U.K.), in London, England, serves as a sub-adviser for the fund. FMR
U.K. was organized in 1986 to provide investment research and advice
to FMR. FMR U.K. may provide investment research and advice on issuers
based outside the United States and may also provide investment
advisory services for the fund.
(small solid bullet) Fidelity Management & Research (Far East) Inc.
(FMR Far East) serves as a sub-adviser for the fund. FMR Far East was
organized in 1986 to provide investment research and advice to FMR.
FMR Far East may provide investment research and advice on issuers
based outside the United States and may also provide investment
advisory services for the fund.
(small solid bullet) Fidelity Investments Japan Limited (FIJ), in
Tokyo, Japan, serves as a sub-adviser for the fund. As of September
28, 1999 , FIJ had approximately $16.3 billion in
discretionary assets under management. FIJ may provide investment
research and advice on issuers based outside the United States for the
fund.
Beginning January 1, 2001, FMR Co., Inc. (FMRC) will serve as
sub-adviser for the fund. FMRC will be primarily responsible for
choosing investments for the fund. FMRC is a wholly owned subsidiary
of FMR.
Robert Stansky is vice president and manager of Magellan, which he has
managed since June 1996. Previously, he managed other Fidelity funds,
including Growth Company from 1987 to 1996. Mr. Stansky joined
Fidelity in 1983.
From time to time a manager, analyst, or other Fidelity employee may
express views regarding a particular company, security, industry, or
market sector. The views expressed by any such person are the views of
only that individual as of the time expressed and do not necessarily
represent the views of Fidelity or any other person in the Fidelity
organization. Any such views are subject to change at any time based
upon market or other conditions and Fidelity disclaims any
responsibility to update such views. These views may not be relied on
as investment advice and, because investment decisions for a Fidelity
fund are based on numerous factors, may not be relied on as an
indication of trading intent on behalf of any Fidelity fund.
The fund pays a management fee to FMR. The management fee is
calculated and paid to FMR every month. The fee is determined by
calculating a basic fee and then applying a performance adjustment.
The performance adjustment either increases or decreases the
management fee, depending on how well the fund has performed relative
to the S&P 500.
MANAGEMENT FEE = BASIC FEE +/- PERFORMANCE ADJUSTMENT
The basic fee is calculated by adding a group fee rate to an
individual fund fee rate, dividing by twelve, and multiplying the
result by the fund's average net assets throughout the month.
The group fee rate is based on the average net assets of all the
mutual funds advised by FMR. This rate cannot rise above 0.52%, and it
drops as total assets under management increase.
For March 2000, the group fee rate was 0.2738% . The individual
fund fee rate is 0.30%.
The basic fee for the fiscal year ended March 31, 2000 was
0.58% of the fund's average net assets.
The performance adjustment rate is calculated monthly by comparing
over the performance period the fund's performance to that of the S&P
500.
The performance period is the most recent 36 month period.
The maximum annualized performance adjustment rate is
(plus/minus)0.20% of the fund's average net assets over the
performance period. The performance adjustment rate is divided by
twelve and multiplied by the fund's average net assets over the
performance period , and the resulting dollar amount is then
added to or subtracted from the basic fee.
The total management fee for the fiscal year ended March 31, 2000, was
0.57 % of the fund's average net assets.
FMR pays FMR U.K. and FMR Far East for providing sub-advisory
services. FMR Far East pays FIJ for providing sub-advisory services.
FMR will pay FMRC for providing sub-advisory services.
FMR may, from time to time, agree to reimburse the fund for management
fees and other expenses above a specified limit. FMR retains the
ability to be repaid by the fund if expenses fall below the specified
limit prior to the end of the fiscal year. Reimbursement arrangements,
which may be discontinued by FMR at any time, can decrease the fund's
expenses and boost its performance.
F UND DISTRIBUTION
FDC distributes the fund's shares.
You may pay a sales charge when you buy your shares.
FDC collects the sales charge.
The fund's sales charge may be reduced if you buy directly through
Fidelity or through prototype or prototype-like retirement plans
sponsored by FMR or FMR Corp. The amount you invest, plus the value of
your account, must fall within the ranges shown below. Purchases made
with assistance or intervention from a financial intermediary are not
eligible for a sales charge reduction.
Sales Charge
Ranges As a % of offering price As an approximate % of net
amount invested
$0 - $249,999 3.00% 3.09%
$250,000 - $499,999 2.00% 2.04%
$500,000 - $999,999 1.00% 1.01%
$1,000,000 or more none none
FDC may pay a portion of sales charge proceeds to securities dealers
who have sold the fund's shares, or to others, including banks and
other financial institutions (qualified recipients), under special
arrangements in connection with FDC's sales activities. The sales
charge paid to qualified recipients is 1.50% of the fund's offering
price.
The sales charge will also be reduced by the percentage of any sales
charge you previously paid on investments in other Fidelity funds or
by the percentage of any sales charge you would have paid if the
reductions in the table above had not existed. These sales charge
credits only apply to purchases made in one of the ways listed below,
and only if you continuously owned Fidelity fund shares, maintained a
Fidelity brokerage core account, or participated in The CORPORATE plan
for Retirement SM Program.
1. By exchange from another Fidelity fund.
2. With proceeds from a transaction in a Fidelity brokerage core
account, including any free credit balance, core money market fund, or
margin availability, to the extent such proceeds were derived from
redemption proceeds from another Fidelity fund.
3. As a participant in The CORPORATEplan for Retirement Program when
shares are bought through plan-qualified loan repayments, and for
exchanges into and out of the Managed Income Portfolio.
The fund's sales charge will not apply:
1. If you buy shares as part of an employee benefit plan having more
than 200 eligible employees or a minimum of $3 million in plan assets
invested in Fidelity mutual funds.
2. To shares in a Fidelity account bought with the proceeds of a
distribution from an employee benefit plan, provided that at the time
of the distribution, the employer or its affiliate maintained a plan
that both qualified for waiver (1) above and had at least some of its
assets invested in Fidelity-managed products. (Distributions
transferred to an IRA account must be transferred within 60 days from
the date of the distribution. All other distributions must be
transferred directly into a Fidelity account).
3. If you are a charitable organization (as defined for purposes of
Section 501(c)(3) of the Internal Revenue Code) investing $100,000 or
more.
4. If you buy shares for a charitable remainder trust or life income
pool established for the benefit of a charitable organization (as
defined for purposes of Section 501(c)(3) of the Internal Revenue
Code).
5. If you are an investor participating in the Fidelity Trust
Portfolios program.
6. To shares bought by a mutual fund or a qualified state tuition
program for which FMR or an affiliate serves as investment manager.
7. To shares bought through Portfolio Advisory Services or Fidelity
Charitable Advisory Services.
8. If you are a current or former trustee or officer of a Fidelity
fund or a current or retired officer, director, or regular employee of
FMR Corp. or Fidelity International Limited or their direct or
indirect subsidiaries (a Fidelity trustee or employee), the spouse of
a Fidelity trustee or employee, a Fidelity trustee or employee acting
as custodian for a minor child, or a person acting as trustee of a
trust for the sole benefit of the minor child of a Fidelity trustee or
employee.
9. If you are a bank trust officer, registered representative, or
other employee of a qualified recipient, as defined on page .
More detailed information about waivers is contained in the statement
of additional information (SAI). A representative of your plan or
organization should call Fidelity for more information.
To qualify for a sales charge reduction or waiver, you must notify
Fidelity in advance of your purchase.
The fund has adopted a Distribution and Service Plan pursuant to Rule
12b-1 under the Investment Company Act of 1940 that recognizes that
FMR may use its management fee revenues, as well as its past profits
or its resources from any other source, to pay FDC for expenses
incurred in connection with providing services intended to result in
the sale of fund shares and/or shareholder support services. FMR,
directly or through FDC, may pay significant amounts to
intermediaries, such as banks, broker-dealers , and other
service-providers, that provide those services. Currently, the Board
of Trustees has authorized such payments.
If payments made by FMR to FDC or to intermediaries under a
Distribution and Service Plan were considered to be paid out of the
fund's assets on an ongoing basis, they might increase the cost of
your investment and might cost you more than paying other types of
sales charges.
To receive sales concessions and waivers and payments made pursuant to
a Distribution and Service Plan, qualified recipients must sign the
appropriate agreement with FDC in advance.
FMR may allocate brokerage transactions in a manner that takes into
account the sale of shares of the fund, provided that the fund
receives brokerage services and commission rates comparable to those
of other broker-dealers.
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 shares of the fund to or to buy shares of the fund from any
person to whom it is unlawful to make such offer.
APPENDIX
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand the
fund's financial history for the past 5 years. Certain information
reflects financial results for a single fund share. The total returns
in the table represent the rate that an investor would have earned (or
lost) on an investment in the fund (assuming reinvestment of all
dividends and distributions). This information has been audited by
PricewaterhouseCoopers LLP , independent accountants, whose
report, along with the fund's financial highlights and financial
statements, are included in the fund's annual report. A free copy of
the annual report is available upon request.
SELECTED PER-SHARE DATA
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Years ended March 31, 2000 1999 1998 1997 1996
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 129.75 $ 108.82 $ 80.20 $ 87.52 $ 72.44
period
Income from Investment
Operations
Net investment income .59 C .73 C .73 C 1.38 C .79
Net realized and unrealized 25.04 26.02 34.35 5.25 19.57
gain (loss)
Total from investment 25.63 26.75 35.08 6.63 20.36
operations
Less Distributions
From net investment income (.73) (.67) (1.25) (1.10) (.59)
From net realized gain (11.39) (5.15) (5.21) (12.85) (4.69)
Total distributions (12.12) (5.82) (6.46) (13.95) (5.28)
Net asset value, end of period $ 143.26 $ 129.75 $ 108.82 $ 80.20 $ 87.52
TOTAL RETURN A, B 21.11% 25.63% 45.41% 9.11% 28.43%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in $ 109,095 $ 90,715 $ 71,968 $ 51,243 $ 56,179
millions)
Ratio of expenses to average .75% .62% .62% .66% .95%
net assets
Ratio of expenses to average .74% D .60% D .61% D .64% D .92% D
net assets after expense
reductions
Ratio of net investment .46% .66% .77% 1.75% .95%
income to average net assets
Portfolio turnover rate 28% 37% 34% 67% 155%
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT INCLUDE THE ONE TIME SALES CHARGE.
C NET INVESTMENT INCOME PER SHARE HAS BEEN CALCULATED BASED ON
AVERAGE SHARES OUTSTANDING DURING THE PERIOD.
D FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S
EXPENSES.
ADDITIONAL PERFORMANCE INFORMATION
Lipper has created new comparison categories that group funds
according to portfolio characteristics and capitalization, as well as
by capitalization only. The Lipper Large-Cap Core Funds Average
reflects the performance (excluding sales charges) of mutual funds
with similar portfolio characteristics and capitalization. The Lipper
Large-Cap Supergroup Average reflects the performance (excluding sales
charges) of mutual funds with similar capitalization. The following
information compares the performance of the fund to two new Lipper
comparison categories. The returns in the following table include the
effect of the fund's 3.00% maximum applicable front-end sales charge.
AVERAGE ANNUAL RETURNS
For the periods ended Past 1 year Past 5 years Past 10 years
December 31, 1999
Magellan 20.32% 25.48% 18.56%
Lipper Large-Cap Core Funds 22.35% 25.53% 16.66%
Average
Lipper Large-Cap Supergroup 24.93% 26.34% 17.07%
Average
You can obtain additional information about the fund. The fund's SAI
includes more detailed information about the fund and its investments.
The SAI is incorporated herein by reference (legally forms a part of
the prospectus). The fund's annual and semi-annual reports include a
discussion of the fund's holdings and recent market conditions and the
fund's investment strategies that affected performance.
For a free copy of any of these documents or to request other
information or ask questions about the fund, call Fidelity at
1-800-544-8544. In addition, you may visit Fidelity's web site at
www.fidelity.com for a free copy of a prospectus or an annual or
semi-annual report or to request other information.
The SAI, the fund's annual and semi-annual reports and other related
materials are available from the Electronic Data Gathering, Analysis,
and Retrieval (EDGAR) Database on the SEC's web site
(http://www.sec.gov). You can obtain copies of this information, after
paying a duplicating fee, by sending a request by e-mail to
[email protected] or by writing the Public Reference Section of the
SEC, Washington, D.C. 20549-0102. You can also review and copy
information about the fund, including the fund's SAI, at the SEC's
Public Reference Room in Washington, D.C. Call 1-202-942-8090 for
information on the operation of the SEC's Public Reference Room.
INVESTMENT COMPANY ACT OF 1940, FILE NUMBER, 811-1193
Fidelity, Magellan, Fidelity Investments & (Pyramid) Design, Fidelity
Investments, FAST, Fidelity Money Line, Fidelity Automatic
Account Builder, Fidelity On-Line Xpress+, and Directed Dividends are
registered trademarks of FMR Corp.
Portfolio Advisory Services, and The Corporateplan for
Retirement are registered service marks of FMR Corp.
The third party marks appearing above are the marks of their
respective owners.
1.702538.103 MAG-pro-0500
FIDELITY(registered trademark) MAGELLAN(registered trademark) FUND
A FUND OF FIDELITY MAGELLAN FUND
STATEMENT OF ADDITIONAL INFORMATION
MAY 22, 2000
This statement of additional information (SAI) is not a prospectus.
Portions of the fund's annual report are incorporated herein. The
annual report is supplied with this SAI.
To obtain a free additional copy of the prospectus, dated May 22,
2000, or an annual report, please call Fidelity at 1-800-544-8544 or
visit Fidelity's web site at www.fidelity.com.
TABLE OF CONTENTS PAGE
Investment Policies and 24
Limitations
Portfolio Transactions 29
Valuation 30
Performance 30
Additional Purchase, Exchange 35
and Redemption Information
Distributions and Taxes 36
Trustees and Officers 36
Control of Investment Advisers 40
Management Contract 40
Distribution Services 44
Transfer and Service Agent 44
Agreements
Description of the Fund 45
Financial Statements 45
Appendix 45
(fidelity_logo_graphic)(registered trademark)
82 Devonshire Street, Boston, MA 02109
MAG-ptb-0500
1.475465.102
INVESTMENT POLICIES AND LIMITATIONS
The following policies and limitations supplement those set forth in
the prospectus. Unless otherwise noted, whenever an investment policy
or limitation states a maximum percentage of the 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
will be determined immediately after and as a result of the 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 the fund's investment policies and limitations.
The fund's fundamental investment policies and limitations cannot be
changed without approval by a "majority of the outstanding voting
securities" (as defined in the Investment Company Act of 1940 (the
1940 Act)) of the fund. However, except for the fundamental investment
limitations listed below, the investment policies and limitations
described in this SAI are not fundamental and may be changed without
shareholder approval.
THE FOLLOWING ARE THE FUND'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, or
securities of other investment companies) if, as a result, (a) more
than 5% of the fund's total assets would be invested in the securities
of that issuer, or (b) the fund would hold more than 10% of the
outstanding voting securities of that issuer;
(2) issue senior securities, except in connection with the insurance
program established by the fund pursuant to an exemptive order issued
by the Securities and Exchange Commission or as otherwise permitted
under the Investment Company Act of 1940;
(3) borrow money, except that the fund may borrow money for temporary
or emergency purposes (not for leveraging or investment) in an amount
not exceeding 33 1/3% of its 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 deemed to be an underwriter within the meaning of the
Securities Act of 1933 in the disposition of "restricted securities;"
(5) purchase the securities of any issuer (other than 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) 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);
(7) purchase or sell physical commodities unless acquired as a result
of ownership of securities or other instruments (but this shall not
prevent the fund from purchasing or selling options and futures
contracts or from investing in securities or other instruments backed
by physical commodities); and
(8) lend any security or make any other loan if, as a result, more
than 33 1/3% of its total assets would be lent to other parties, but
this limitation does not apply to purchases of debt securities or to
repurchase agreements.
(9) 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 objective, 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 portfolio for which FMR or an
affiliate serves as investment adviser or (b) by engaging in reverse
repurchase agreements with any party (reverse repurchase agreements
are treated as borrowings for purposes of fundamental investment
limitation (3)).
(iv) 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.
(v) The fund does not currently intend to lend assets other than
securities to other parties, except by (a) lending money (up to 15% of
the fund's net assets) to a registered investment company or portfolio
for which FMR or an affiliate serves as investment adviser or (b)
acquiring loans, loan participations, or other forms of direct debt
instruments and, in connection therewith, assuming any associated
unfunded commitments of the sellers. (This limitation does not apply
to purchases of debt securities or to repurchase agreements.)
(vi) 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 objective, policies, and
limitations as the fund.
With respect to limitation (iv), if through a change in values, net
assets, or other circumstances, the fund were in a position where more
than 10% of its net assets were invested in illiquid securities, it
would consider appropriate steps to protect liquidity.
For the fund's limitations on futures and options transactions, see
the section entitled "Limitations on Futures and Options Transactions"
on page 34.
The following pages contain more detailed information about types of
instruments in which the fund may invest, strategies Fidelity
Management & Research Company (FMR) may employ in pursuit of the
fund's investment objective, and a summary of related risks. FMR may
not buy all of these instruments or use all of these techniques unless
it believes that doing so will help the fund achieve its goal.
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 involve 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.
BORROWING. The fund may borrow from banks or from other funds advised
by FMR or its affiliates, or through reverse repurchase agreements. If
the fund borrows money, its share price may be subject to greater
fluctuation until the borrowing is paid off. If the fund makes
additional investments while borrowings are outstanding, this may be
considered a form of leverage.
CASH MANAGEMENT. A fund can hold uninvested cash or can invest it in
cash equivalents such as money market securities, repurchase
agreements or shares of money market funds. Generally, these
securities offer less potential for gains than other types of
securities.
CENTRAL CASH FUNDS are money market funds managed by FMR or its
affiliates that seek to earn a high level of current income (free from
federal income tax in the case of a municipal money market fund) while
maintaining a stable $1.00 share price. The funds comply with
industry-standard requirements for money market funds regarding the
quality, maturity, and diversification of their investments.
COMMON STOCK represents an equity or ownership interest in an issuer.
In the event an issuer is liquidated or declares bankruptcy, the
claims of owners of bonds and preferred stock take precedence over the
claims of those who own common stock.
CONVERTIBLE SECURITIES are bonds, debentures, notes, preferred stocks
or other securities that may be converted or exchanged (by the holder
or by the issuer) into shares of the underlying common stock (or cash
or securities of equivalent value) at a stated exchange ratio. A
convertible security may also be called for redemption or conversion
by the issuer after a particular date and under certain circumstances
(including a specified price) established upon issue. If a convertible
security held by a fund is called for redemption or conversion, the
fund could be required to tender it for redemption, convert it into
the underlying common stock, or sell it to a third party.
Convertible securities generally have less potential for gain or loss
than common stocks. Convertible securities generally provide yields
higher than the underlying common stocks, but generally lower than
comparable non-convertible securities. Because of this higher yield,
convertible securities generally sell at prices above their
"conversion value," which is the current market value of the stock to
be received upon conversion. The difference between this conversion
value and the price of convertible securities will vary over time
depending on changes in the value of the underlying common stocks and
interest rates. When the underlying common stocks decline in value,
convertible securities will tend not to decline to the same extent
because of the interest or dividend payments and the repayment of
principal at maturity for certain types of convertible securities.
However, securities that are convertible other than at the option of
the holder generally do not limit the potential for loss to the same
extent as securities convertible at the option of the holder. When the
underlying common stocks rise in value, the value of convertible
securities may also be expected to increase. At the same time,
however, the difference between the market value of convertible
securities and their conversion value will narrow, which means that
the value of convertible securities will generally not increase to the
same extent as the value of the underlying common stocks. Because
convertible securities may also be interest-rate sensitive, their
value may increase as interest rates fall and decrease as interest
rates rise. Convertible securities are also subject to credit risk,
and are often lower-quality securities.
DEBT SECURITIES are used by issuers to borrow money. The issuer
usually pays a fixed, variable or floating rate of interest, and must
repay the amount borrowed at the maturity of the security. Some debt
securities, such as zero coupon bonds, do not pay interest but are
sold at a deep discount from their face values. Debt securities
include corporate bonds, government securities, and mortgage and other
asset-backed securities.
EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies,
and securities issued by U.S. entities with substantial foreign
operations may involve significant risks in addition to the risks
inherent in U.S. investments.
Foreign investments involve risks relating to local political,
economic, regulatory, or social instability, military action or
unrest, or adverse diplomatic developments, and may be affected by
actions of foreign governments adverse to the interests of U.S.
investors. Such actions may include expropriation or nationalization
of assets, confiscatory taxation, restrictions on U.S. investment or
on the ability to repatriate assets or convert currency into U.S.
dollars, or other government intervention. Additionally, governmental
issuers of foreign debt securities may be unwilling to pay interest
and repay principal when due and may require that the conditions for
payment be renegotiated. There is no assurance that FMR will be able
to anticipate these potential events or counter their effects. In
addition, the value of securities denominated in foreign currencies
and of dividends and interest paid with respect to such securities
will fluctuate based on the relative strength of the U.S. dollar.
It is anticipated that in most cases the best available market for
foreign securities will be on an exchange or in over-the-counter (OTC)
markets located outside of the United States. Foreign stock markets,
while growing in volume and sophistication, are generally not as
developed as those in the United States, and securities of some
foreign issuers may be less liquid and more volatile than securities
of comparable U.S. issuers. Foreign security trading, settlement and
custodial practices (including those involving securities settlement
where fund assets may be released prior to receipt of payment) are
often less developed than those in U.S. markets, and may result in
increased risk or substantial delays in the event of a failed trade or
the insolvency of, or breach of duty by, a foreign broker-dealer,
securities depository or foreign subcustodian. In addition, the costs
associated with foreign investments, including withholding taxes,
brokerage commissions and custodial costs, are generally higher than
with U.S. investments.
Foreign markets may offer less protection to investors than U.S.
markets. Foreign issuers are generally not bound by uniform
accounting, auditing, and financial reporting requirements and
standards of practice comparable to those applicable to U.S. issuers.
Adequate public information on foreign issuers may not be available,
and it may be difficult to secure dividends and information regarding
corporate actions on a timely basis. In general, there is less overall
governmental supervision and regulation of securities exchanges,
brokers, and listed companies than in the United States. OTC markets
tend to be less regulated than stock exchange markets and, in certain
countries, may be totally unregulated. Regulatory enforcement may be
influenced by economic or political concerns, and investors may have
difficulty enforcing their legal rights in foreign countries.
Some foreign securities impose restrictions on transfer within the
United States or to U.S. persons. Although securities subject to such
transfer restrictions may be marketable abroad, they may be less
liquid than foreign securities of the same class that are not subject
to such restrictions.
American Depositary Receipts (ADRs) as well as other "hybrid" forms of
ADRs, including European Depositary Receipts (EDRs) and Global
Depositary Receipts (GDRs), are certificates evidencing ownership of
shares of a foreign issuer. These certificates are issued by
depository banks and generally trade on an established market in the
United States or elsewhere. The underlying shares are held in trust by
a custodian bank or similar financial institution in the issuer's home
country. The depository bank may not have physical custody of the
underlying securities at all times and may charge fees for various
services, including forwarding dividends and interest and corporate
actions. ADRs are alternatives to directly purchasing the underlying
foreign securities in their national markets and currencies. However,
ADRs continue to be subject to many of the risks associated with
investing directly in foreign securities. These risks include foreign
exchange risk as well as the political and economic risks of the
underlying issuer's country.
The risks of foreign investing may be magnified for investments in
emerging markets. Security prices in emerging markets can be
significantly more volatile than those in more developed markets,
reflecting the greater uncertainties of investing in less established
markets and economies. In particular, countries with emerging markets
may have relatively unstable governments, may present the risks of
nationalization of businesses, restrictions on foreign ownership and
prohibitions on the repatriation of assets, and may have less
protection of property rights than more developed countries. The
economies of countries with emerging markets may be based on only a
few industries, may be highly vulnerable to changes in local or global
trade conditions, and may suffer from extreme and volatile debt
burdens or inflation rates. Local securities markets may trade a small
number of securities and may be unable to respond effectively to
increases in trading volume, potentially making prompt liquidation of
holdings difficult or impossible at times.
FOREIGN CURRENCY TRANSACTIONS. A fund may conduct foreign currency
transactions on a spot (i.e., cash) or forward basis (i.e., by
entering into forward contracts to purchase or sell foreign
currencies). Although foreign exchange dealers generally do not charge
a fee for such conversions, they do realize a profit based on the
difference between the prices at which they are buying and selling
various currencies. Thus, a dealer may offer to sell a foreign
currency at one rate, while offering a lesser rate of exchange should
the counterparty desire to resell that currency to the dealer. Forward
contracts are customized transactions that require a specific amount
of a currency to be delivered at a specific exchange rate on a
specific date or range of dates in the future. Forward contracts are
generally traded in an interbank market directly between currency
traders (usually large commercial banks) and their customers. The
parties to a forward contract may agree to offset or terminate the
contract before its maturity, or may hold the contract to maturity and
complete the contemplated currency exchange.
The following discussion summarizes the principal currency management
strategies involving forward contracts that could be used by a fund. A
fund may also use swap agreements, indexed securities, and options and
futures contracts relating to foreign currencies for the same
purposes.
A "settlement hedge" or "transaction hedge" is designed to protect a
fund against an adverse change in foreign currency values between the
date a security is purchased or sold and the date on which payment is
made or received. Entering into a forward contract for the purchase or
sale of the amount of foreign currency involved in an underlying
security transaction for a fixed amount of U.S. dollars "locks in" the
U.S. dollar price of the security. Forward contracts to purchase or
sell a foreign currency may also be used by a fund in anticipation of
future purchases or sales of securities denominated in foreign
currency, even if the specific investments have not yet been selected
by FMR.
A fund may also use forward contracts to hedge against a decline in
the value of existing investments denominated in foreign currency. For
example, if a fund owned securities denominated in pounds sterling, it
could enter into a forward contract to sell pounds sterling in return
for U.S. dollars to hedge against possible declines in the pound's
value. Such a hedge, sometimes referred to as a "position hedge,"
would tend to offset both positive and negative currency fluctuations,
but would not offset changes in security values caused by other
factors. A fund could also hedge the position by selling another
currency expected to perform similarly to the pound sterling. This
type of hedge, sometimes referred to as a "proxy hedge," could offer
advantages in terms of cost, yield, or efficiency, but generally would
not hedge currency exposure as effectively as a direct hedge into U.S.
dollars. Proxy hedges may result in losses if the currency used to
hedge does not perform similarly to the currency in which the hedged
securities are denominated.
A fund may enter into forward contracts to shift its investment
exposure from one currency into another. This may include shifting
exposure from U.S. dollars to a foreign currency, or from one foreign
currency to another foreign currency. This type of strategy, sometimes
known as a "cross-hedge," will tend to reduce or eliminate exposure to
the currency that is sold, and increase exposure to the currency that
is purchased, much as if a fund had sold a security denominated in one
currency and purchased an equivalent security denominated in another.
Cross-hedges protect against losses resulting from a decline in the
hedged currency, but will cause a fund to assume the risk of
fluctuations in the value of the currency it purchases.
Successful use of currency management strategies will depend on FMR's
skill in analyzing currency values. Currency management strategies may
substantially change a fund's investment exposure to changes in
currency exchange rates and could result in losses to a fund if
currencies do not perform as FMR anticipates. For example, if a
currency's value rose at a time when FMR had hedged a fund by selling
that currency in exchange for dollars, a fund would not participate in
the currency's appreciation. If FMR hedges currency exposure through
proxy hedges, a fund could realize currency losses from both the hedge
and the security position if the two currencies do not move in tandem.
Similarly, if FMR increases a fund's exposure to a foreign currency
and that currency's value declines, a fund will realize a loss. There
is no assurance that FMR's use of currency management strategies will
be advantageous to a fund or that it will hedge at appropriate times.
FUND'S RIGHTS AS A SHAREHOLDER. The fund does not intend to direct or
administer the day-to-day operations of any company. A fund, however,
may exercise its rights as a shareholder and may communicate its views
on important matters of policy to management, the Board of Directors,
and shareholders of a company when FMR determines that such matters
could have a significant effect on the value of the fund's investment
in the company. The activities in which a fund may engage, either
individually or in conjunction with others, may include, among others,
supporting or opposing proposed changes in a company's corporate
structure or business activities; seeking changes in a company's
directors or management; seeking changes in a company's direction or
policies; seeking the sale or reorganization of the company or a
portion of its assets; or supporting or opposing third-party takeover
efforts. This area of corporate activity is increasingly prone to
litigation and it is possible that a fund could be involved in
lawsuits related to such activities. FMR will monitor such activities
with a view to mitigating, to the extent possible, the risk of
litigation against a fund and the risk of actual liability if a fund
is involved in litigation. No guarantee can be made, however, that
litigation against a fund will not be undertaken or liabilities
incurred.
FUTURES AND OPTIONS. The following paragraphs pertain to futures and
options: Combined Positions, Correlation of Price Changes, Futures
Contracts, Futures Margin Payments, Limitations on Futures and Options
Transactions, Liquidity of Options and Futures Contracts, Options and
Futures Relating to Foreign Currencies, OTC Options, Purchasing Put
and Call Options, and Writing Put and Call Options.
COMBINED POSITIONS involve purchasing and writing options in
combination with each other, or in combination with futures or forward
contracts, to adjust the risk and return characteristics of the
overall position. For example, purchasing a put option and writing a
call option on the same underlying instrument would construct a
combined position whose risk and return characteristics are similar to
selling a futures contract. Another possible combined position would
involve writing a call option at one strike price and buying a call
option at a lower price, to reduce the risk of the written call option
in the event of a substantial price increase. Because combined options
positions involve multiple trades, they result in higher transaction
costs and may be more difficult to open and close out.
CORRELATION OF PRICE CHANGES. Because there are a limited number of
types of exchange-traded options and futures contracts, it is likely
that the standardized contracts available will not match a fund's
current or anticipated investments exactly. A fund may invest in
options and futures contracts based on securities with different
issuers, maturities, or other characteristics from the securities in
which the fund typically invests, which involves a risk that the
options or futures position will not track the performance of the
fund's other investments.
Options and futures prices can also diverge from the prices of their
underlying instruments, even if the underlying instruments match a
fund's investments well. Options and futures prices are affected by
such factors as current and anticipated short-term interest rates,
changes in volatility of the underlying instrument, and the time
remaining until expiration of the contract, which may not affect
security prices the same way. Imperfect correlation may also result
from differing levels of demand in the options and futures markets and
the securities markets, from structural differences in how options and
futures and securities are traded, or from imposition of daily price
fluctuation limits or trading halts. A fund may purchase or sell
options and futures contracts with a greater or lesser value than the
securities it wishes to hedge or intends to purchase in order to
attempt to compensate for differences in volatility between the
contract and the securities, although this may not be successful in
all cases. If price changes in a fund's options or futures positions
are poorly correlated with its other investments, the positions may
fail to produce anticipated gains or result in losses that are not
offset by gains in other investments.
FUTURES CONTRACTS. In purchasing a futures contract, the buyer agrees
to purchase a specified underlying instrument at a specified future
date. In selling a futures contract, the seller agrees to sell a
specified underlying instrument at a specified future date. The price
at which the purchase and sale will take place is fixed when the buyer
and seller enter into the contract. Some currently available futures
contracts are based on specific securities, such as U.S. Treasury
bonds or notes, and some are based on indices of securities prices,
such as the Standard & Poor's 500 Index SM (S&P 500(registered
trademark)). Futures can be held until their delivery dates, or can be
closed out before then if a liquid secondary market is available.
The value of a futures contract tends to increase and decrease in
tandem with the value of its underlying instrument. Therefore,
purchasing futures contracts will tend to increase a fund's exposure
to positive and negative price fluctuations in the underlying
instrument, much as if it had purchased the underlying instrument
directly. When a fund sells a futures contract, by contrast, the value
of its futures position will tend to move in a direction contrary to
the market. Selling futures contracts, therefore, will tend to offset
both positive and negative market price changes, much as if the
underlying instrument had been sold.
FUTURES MARGIN PAYMENTS. The purchaser or seller of a futures contract
is not required to deliver or pay for the underlying instrument unless
the contract is held until the delivery date. However, both the
purchaser and seller are required to deposit "initial margin" with a
futures broker, known as a futures commission merchant (FCM), when the
contract is entered into. Initial margin deposits are typically equal
to a percentage of the contract's value. If the value of either
party's position declines, that party will be required to make
additional "variation margin" payments to settle the change in value
on a daily basis. The party that has a gain may be entitled to receive
all or a portion of this amount. Initial and variation margin payments
do not constitute purchasing securities on margin for purposes of a
fund's investment limitations. In the event of the bankruptcy of an
FCM that holds margin on behalf of a fund, the fund may be entitled to
return of margin owed to it only in proportion to the amount received
by the FCM's other customers, potentially resulting in losses to the
fund.
LIMITATIONS ON FUTURES AND OPTIONS TRANSACTIONS. The fund has filed a
notice of eligibility for exclusion from the definition of the term
"commodity pool operator" with the Commodity Futures Trading
Commission (CFTC) and the National Futures Association, which regulate
trading in the futures markets. The fund intends to comply with Rule
4.5 under the Commodity Exchange Act, which limits the extent to which
the fund can commit assets to initial margin deposits and option
premiums.
In addition, the fund will not: (a) sell futures contracts, purchase
put options, or write call options if, as a result, more than 25% of
the fund's total assets would be hedged with futures and options under
normal conditions; (b) purchase futures contracts or write put options
if, as a result, the fund's total obligations upon settlement or
exercise of purchased futures contracts and written put options would
exceed 25% of its total assets under normal conditions; or (c)
purchase call options if, as a result, the current value of option
premiums for call options purchased by the fund would exceed 5% of the
fund's total assets. These limitations do not apply to options
attached to or acquired or traded together with their underlying
securities, and do not apply to securities that incorporate features
similar to options.
The above limitations on the fund's investments in futures contracts
and options, and the fund's policies regarding futures contracts and
options discussed elsewhere in this SAI may be changed as regulatory
agencies permit.
LIQUIDITY OF OPTIONS AND FUTURES CONTRACTS. There is no assurance a
liquid secondary market will exist for any particular options or
futures contract at any particular time. Options may have relatively
low trading volume and liquidity if their strike prices are not close
to the underlying instrument's current price. In addition, exchanges
may establish daily price fluctuation limits for options and futures
contracts, and may halt trading if a contract's price moves upward or
downward more than the limit in a given day. On volatile trading days
when the price fluctuation limit is reached or a trading halt is
imposed, it may be impossible to enter into new positions or close out
existing positions. If the secondary market for a contract is not
liquid because of price fluctuation limits or otherwise, it could
prevent prompt liquidation of unfavorable positions, and potentially
could require a fund to continue to hold a position until delivery or
expiration regardless of changes in its value. As a result, a fund's
access to other assets held to cover its options or futures positions
could also be impaired.
OPTIONS AND FUTURES RELATING TO FOREIGN CURRENCIES. Currency futures
contracts are similar to forward currency exchange contracts, except
that they are traded on exchanges (and have margin requirements) and
are standardized as to contract size and delivery date. Most currency
futures contracts call for payment or delivery in U.S. dollars. The
underlying instrument of a currency option may be a foreign currency,
which generally is purchased or delivered in exchange for U.S.
dollars, or may be a futures contract. The purchaser of a currency
call obtains the right to purchase the underlying currency, and the
purchaser of a currency put obtains the right to sell the underlying
currency.
The uses and risks of currency options and futures are similar to
options and futures relating to securities or indices, as discussed
above. A fund may purchase and sell currency futures and may purchase
and write currency options to increase or decrease its exposure to
different foreign currencies. Currency options may also be purchased
or written in conjunction with each other or with currency futures or
forward contracts. Currency futures and options values can be expected
to correlate with exchange rates, but may not reflect other factors
that affect the value of a fund's investments. A currency hedge, for
example, should protect a Yen-denominated security from a decline in
the Yen, but will not protect a fund against a price decline resulting
from deterioration in the issuer's creditworthiness. Because the value
of a fund's foreign-denominated investments changes in response to
many factors other than exchange rates, it may not be possible to
match the amount of currency options and futures to the value of the
fund's investments exactly over time.
OTC OPTIONS. Unlike exchange-traded options, which are standardized
with respect to the underlying instrument, expiration date, contract
size, and strike price, the terms of OTC options (options not traded
on exchanges) generally are established through negotiation with the
other party to the option contract. While this type of arrangement
allows the purchaser or writer greater flexibility to tailor an option
to its needs, OTC options generally involve greater credit risk than
exchange-traded options, which are guaranteed by the clearing
organization of the exchanges where they are traded.
PURCHASING PUT AND CALL OPTIONS. By purchasing a put option, the
purchaser obtains the right (but not the obligation) to sell the
option's underlying instrument at a fixed strike price. In return for
this right, the purchaser pays the current market price for the option
(known as the option premium). Options have various types of
underlying instruments, including specific securities, indices of
securities prices, and futures contracts. The purchaser may terminate
its position in a put option by allowing it to expire or by exercising
the option. If the option is allowed to expire, the purchaser will
lose the entire premium. If the option is exercised, the purchaser
completes the sale of the underlying instrument at the strike price. A
purchaser may also terminate a put option position by closing it out
in the secondary market at its current price, if a liquid secondary
market exists.
The buyer of a typical put option can expect to realize a gain if
security prices fall substantially. However, if the underlying
instrument's price does not fall enough to offset the cost of
purchasing the option, a put buyer can expect to suffer a loss
(limited to the amount of the premium, plus related transaction
costs).
The features of call options are essentially the same as those of put
options, except that the purchaser of a call option obtains the right
to purchase, rather than sell, the underlying instrument at the
option's strike price. A call buyer typically attempts to participate
in potential price increases of the underlying instrument with risk
limited to the cost of the option if security prices fall. At the same
time, the buyer can expect to suffer a loss if security prices do not
rise sufficiently to offset the cost of the option.
WRITING PUT AND CALL OPTIONS. The writer of a put or call option takes
the opposite side of the transaction from the option's purchaser. In
return for receipt of the premium, the writer assumes the obligation
to pay the strike price for the option's underlying instrument if the
other party to the option chooses to exercise it. The writer may seek
to terminate a position in a put option before exercise by closing out
the option in the secondary market at its current price. If the
secondary market is not liquid for a put option, however, the writer
must continue to be prepared to pay the strike price while the option
is outstanding, regardless of price changes. When writing an option on
a futures contract, a fund will be required to make margin payments to
an FCM as described above for futures contracts.
If security prices rise, a put writer would generally expect to
profit, although its gain would be limited to the amount of the
premium it received. If security prices remain the same over time, it
is likely that the writer will also profit, because it should be able
to close out the option at a lower price. If security prices fall, the
put writer would expect to suffer a loss. This loss should be less
than the loss from purchasing the underlying instrument directly,
however, because the premium received for writing the option should
mitigate the effects of the decline.
Writing a call option obligates the writer to sell or deliver the
option's underlying instrument, in return for the strike price, upon
exercise of the option. The characteristics of writing call options
are similar to those of writing put options, except that writing calls
generally is a profitable strategy if prices remain the same or fall.
Through receipt of the option premium, a call writer mitigates the
effects of a price decline. At the same time, because a call writer
must be prepared to deliver the underlying instrument in return for
the strike price, even if its current value is greater, a call writer
gives up some ability to participate in security price increases.
ILLIQUID SECURITIES cannot be sold or disposed of in the ordinary
course of business at approximately the prices at which they are
valued. Difficulty in selling securities may result in a loss or may
be costly to a fund. 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
securities. In determining the liquidity of a fund's investments, FMR
may consider various factors, including (1) the frequency and volume
of trades and quotations, (2) the number of dealers and prospective
purchasers in the marketplace, (3) dealer undertakings to make a
market, and (4) the nature of the security and the market in which it
trades (including any demand, put or tender features, the mechanics
and other requirements for transfer, any letters of credit or other
credit enhancement features, any ratings, the number of holders, the
method of soliciting offers, the time required to dispose of the
security, and the ability to assign or offset the rights and
obligations of the security).
INDEXED SECURITIES are instruments whose prices are indexed to the
prices of other securities, securities indices, currencies, or other
financial indicators. Indexed securities typically, but not always,
are debt securities or deposits whose value at maturity or coupon rate
is determined by reference to a specific instrument or statistic.
Currency-indexed securities typically are short-term to
intermediate-term debt securities whose maturity values or interest
rates are determined by reference to the values of one or more
specified foreign currencies, and may offer higher yields than U.S.
dollar-denominated securities. Currency-indexed securities may be
positively or negatively indexed; that is, their maturity value may
increase when the specified currency value increases, resulting in a
security that performs similarly to a foreign-denominated instrument,
or their maturity value may decline when foreign currencies increase,
resulting in a security whose price characteristics are similar to a
put on the underlying currency. Currency-indexed securities may also
have prices that depend on the values of a number of different foreign
currencies relative to each other.
The performance of indexed securities depends to a great extent on the
performance of the security, currency, or other instrument to which
they are indexed, and may also be influenced by interest rate changes
in the United States and abroad. Indexed securities may be more
volatile than the underlying instruments. Indexed securities are also
subject to the credit risks associated with the issuer of the
security, and their values may decline substantially if the issuer's
creditworthiness deteriorates. Recent issuers of indexed securities
have included banks, corporations, and certain U.S. Government
agencies.
INTERFUND BORROWING AND LENDING PROGRAM. Pursuant to an exemptive
order issued by the SEC, a fund may lend money to, and borrow money
from, other funds advised by FMR or its affiliates. A fund will lend
through the program only when the returns are higher than those
available from an investment in repurchase agreements, and will borrow
through the program only when the costs are equal to or lower than the
cost of bank loans. 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. 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.
INVESTMENT-GRADE DEBT SECURITIES. Investment-grade debt securities are
medium and high-quality securities. Some may possess speculative
characteristics and may be more sensitive to economic changes and to
changes in the financial conditions of issuers. A debt security is
considered to be investment-grade if it is rated investment-grade by
Moody's Investors Service, Standard & Poor's, Duff & Phelps Credit
Rating Co., or Fitch IBCA Inc., or is unrated but considered to be of
equivalent quality by FMR.
LOANS AND OTHER DIRECT DEBT INSTRUMENTS. Direct debt instruments are
interests in amounts owed by a corporate, governmental, or other
borrower to lenders or lending syndicates (loans and loan
participations), to suppliers of goods or services (trade claims or
other receivables), or to other parties. Direct debt instruments
involve a risk of loss in case of default or insolvency of the
borrower and may offer less legal protection to the purchaser in the
event of fraud or misrepresentation, or there may be a requirement
that a fund supply additional cash to a borrower on demand.
Purchasers of loans and other forms of direct indebtedness depend
primarily upon the creditworthiness of the borrower for payment of
interest and repayment of principal. If scheduled interest or
principal payments are not made, the value of the instrument may be
adversely affected. Loans that are fully secured provide more
protections than an unsecured loan in the event of failure to make
scheduled interest or principal payments. However, there is no
assurance that the liquidation of collateral from a secured loan would
satisfy the borrower's obligation, or that the collateral could be
liquidated. Indebtedness of borrowers whose creditworthiness is poor
involves substantially greater risks and may be highly speculative.
Borrowers that are in bankruptcy or restructuring may never pay off
their indebtedness, or may pay only a small fraction of the amount
owed. Direct indebtedness of developing countries also involves a risk
that the governmental entities responsible for the repayment of the
debt may be unable, or unwilling, to pay interest and repay principal
when due.
Investments in loans through direct assignment of a financial
institution's interests with respect to a loan may involve additional
risks. For example, if a loan is foreclosed, the purchaser could
become part owner of any collateral, and would bear the costs and
liabilities associated with owning and disposing of the collateral. In
addition, it is conceivable that under emerging legal theories of
lender liability, a purchaser could be held liable as a co-lender.
Direct debt instruments may also involve a risk of insolvency of the
lending bank or other intermediary.
A loan is often administered by a bank or other financial institution
that acts as agent for all holders. The agent administers the terms of
the loan, as specified in the loan agreement. Unless, under the terms
of the loan or other indebtedness, the purchaser has direct recourse
against the borrower, the purchaser may have to rely on the agent to
apply appropriate credit remedies against a borrower. If assets held
by the agent for the benefit of a purchaser were determined to be
subject to the claims of the agent's general creditors, the purchaser
might incur certain costs and delays in realizing payment on the loan
or loan participation and could suffer a loss of principal or
interest.
Direct indebtedness may include letters of credit, revolving credit
facilities, or other standby financing commitments that obligate
purchasers to make additional cash payments on demand. These
commitments may have the effect of requiring a purchaser to increase
its investment in a borrower at a time when it would not otherwise
have done so, even if the borrower's condition makes it unlikely that
the amount will ever be repaid.
The fund limits the amount of total assets that it will invest in any
one issuer or in issuers within the same industry (see the fund's
investment limitations). For purposes of these limitations, a fund
generally will treat the borrower as the "issuer" of indebtedness held
by the fund. In the case of loan participations where a bank or other
lending institution serves as financial intermediary between a fund
and the borrower, if the participation does not shift to the fund the
direct debtor-creditor relationship with the borrower, SEC
interpretations require a fund, in appropriate circumstances, to treat
both the lending bank or other lending institution and the borrower as
"issuers" for these purposes. Treating a financial intermediary as an
issuer of indebtedness may restrict a fund's ability to invest in
indebtedness related to a single financial intermediary, or a group of
intermediaries engaged in the same industry, even if the underlying
borrowers represent many different companies and industries.
LOWER-QUALITY DEBT SECURITIES. Lower-quality debt securities have poor
protection with respect to the payment of interest and repayment of
principal, or may be in default. These securities are often considered
to be speculative and involve greater risk of loss or price changes
due to changes in the issuer's capacity to pay. The market prices of
lower-quality debt securities may fluctuate more than those of
higher-quality debt securities and may decline significantly in
periods of general economic difficulty, which may follow periods of
rising interest rates.
The market for lower-quality debt securities may be thinner and less
active than that for higher-quality debt securities, which can
adversely affect the prices at which the former are sold. Adverse
publicity and changing investor perceptions may affect the liquidity
of lower-quality debt securities and the ability of outside pricing
services to value lower-quality debt securities.
Because the risk of default is higher for lower-quality debt
securities, FMR's research and credit analysis are an especially
important part of managing securities of this type. FMR will attempt
to identify those issuers of high-yielding securities whose financial
condition is adequate to meet future obligations, has improved, or is
expected to improve in the future. FMR's analysis focuses on relative
values based on such factors as interest or dividend coverage, asset
coverage, earnings prospects, and the experience and managerial
strength of the issuer.
A fund may choose, at its expense or in conjunction with others, to
pursue litigation or otherwise to exercise its rights as a security
holder to seek to protect the interests of security holders if it
determines this to be in the best interest of the fund's shareholders.
PREFERRED STOCK represents an equity or ownership interest in an
issuer that pays dividends at a specified rate and that has precedence
over common stock in the payment of dividends. In the event an issuer
is liquidated or declares bankruptcy, the claims of owners of bonds
take precedence over the claims of those who own preferred and common
stock.
REAL ESTATE INVESTMENT TRUSTS. Equity real estate investment trusts
own real estate properties, while mortgage real estate investment
trusts make construction, development, and long-term mortgage loans.
Their value may be affected by changes in the value of the underlying
property of the trusts, the creditworthiness of the issuer, property
taxes, interest rates, and tax and regulatory requirements, such as
those relating to the environment. Both types of trusts are dependent
upon management skill, are not diversified, and are subject to heavy
cash flow dependency, defaults by borrowers, self-liquidation, and the
possibility of failing to qualify for tax-free status of income under
the Internal Revenue Code and failing to maintain exemption from the
1940 Act.
REPURCHASE AGREEMENTS involve an agreement to purchase a security and
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. As protection against the risk
that the original seller will not fulfill its obligation, the
securities are held in a separate account at a bank, marked-to-market
daily, and maintained at a value at least equal to the sale price plus
the accrued incremental amount. The value of the security purchased
may be more or less than the price at which the counterparty has
agreed to purchase the security. In addition, delays or losses could
result if the other party to the agreement defaults or becomes
insolvent. The fund will engage in repurchase agreement transactions
with parties whose creditworthiness has been reviewed and found
satisfactory by FMR.
RESTRICTED SECURITIES are subject to legal restrictions on their sale.
Difficulty in selling securities may result in a loss or be costly to
a fund. Restricted securities generally can be sold in privately
negotiated transactions, pursuant to an exemption from registration
under the Securities Act of 1933, or in a registered public offering.
Where registration is required, the holder of a registered security
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, the holder might obtain a less
favorable price than prevailed when it decided to seek registration of
the security.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a
fund sells a security to another party, such as a bank or
broker-dealer, in return for cash and agrees to repurchase that
security at an agreed-upon price and time. The fund will enter into
reverse repurchase agreements with parties whose creditworthiness has
been reviewed and found satisfactory by FMR. Such transactions may
increase fluctuations in the market value of fund assets and may be
viewed as a form of leverage.
SECURITIES OF OTHER INVESTMENT COMPANIES. including shares of
closed-end investment companies, unit investment trusts, and open-end
investment companies, represent interests in professionally managed
portfolios that may invest in any type of instrument. Investing in
other investment companies involves substantially the same risks as
investing directly in the underlying instruments, but may involve
additional expenses at the investment company-level, such as portfolio
management fees and operating expenses. Certain types of investment
companies, such as closed-end investment companies, issue a fixed
number of shares that trade on a stock exchange or over-the-counter at
a premium or a discount to their net asset value. Others are
continuously offered at net asset value, but may also be traded in the
secondary market.
The extent to which a fund can invest in securities of other
investment companies is limited by federal securities laws.
SECURITIES LENDING. A fund may lend securities to parties such as
broker-dealers or other institutions, including Fidelity Brokerage
Services, Inc. (FBSI). FBSI is a member of the New York Stock Exchange
(NYSE) and a subsidiary of FMR Corp.
Securities lending allows a fund to retain ownership of the securities
loaned and, at the same time, earn additional income. The borrower
provides the fund with collateral in an amount at least equal to the
value of the securities loaned. The fund maintains the ability to
obtain the right to vote or consent on proxy proposals involving
material events affecting securities loaned. If the borrower defaults
on its obligation to return the securities loaned because of
insolvency or other reasons, a fund could experience delays and costs
in recovering the securities loaned or in gaining access to the
collateral. These delays and costs could be greater for foreign
securities. If a fund is not able to recover the securities loaned, a
fund may sell the collateral and purchase a replacement investment in
the market. The value of the collateral could decrease below the value
of the replacement investment by the time the replacement investment
is purchased. Loans will be made only to parties deemed by FMR to be
in good standing and when, in FMR's judgment, the income earned would
justify the risks.
Cash received as collateral through loan transactions may be invested
in other eligible securities. Investing this cash subjects that
investment, as well as the securities loaned, to market appreciation
or depreciation.
SHORT SALES "AGAINST THE BOX" are short sales of securities that a
fund owns or has the right to obtain (equivalent in kind or amount to
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.
SWAP AGREEMENTS can be individually negotiated and structured to
include exposure to a variety of different types of investments or
market factors. Depending on their structure, swap agreements may
increase or decrease a fund's exposure to long- or short-term interest
rates (in the United States or abroad), foreign currency values,
mortgage securities, corporate borrowing rates, or other factors such
as security prices or inflation rates. Swap agreements can take many
different forms and are known by a variety of names.
In a typical cap or floor agreement, one party agrees to make payments
only under specified circumstances, usually in return for payment of a
fee by the other party. For example, the buyer of an interest rate cap
obtains the right to receive payments to the extent that a specified
interest rate exceeds an agreed-upon level, while the seller of an
interest rate floor is obligated to make payments to the extent that a
specified interest rate falls below an agreed-upon level. An interest
rate collar combines elements of buying a cap and selling a floor.
Swap agreements will tend to shift a fund's investment exposure from
one type of investment to another. For example, if the fund agreed to
exchange payments in dollars for payments in foreign currency, the
swap agreement would tend to decrease the fund's exposure to U.S.
interest rates and increase its exposure to foreign currency and
interest rates. Caps and floors have an effect similar to buying or
writing options. Depending on how they are used, swap agreements may
increase or decrease the overall volatility of a fund's investments
and its share price.
The most significant factor in the performance of swap agreements is
the change in the specific interest rate, currency, or other factors
that determine the amounts of payments due to and from a fund. If a
swap agreement calls for payments by the fund, the fund must be
prepared to make such payments when due. In addition, if the
counterparty's creditworthiness declined, the value of a swap
agreement would be likely to decline, potentially resulting in losses.
A fund may be able to eliminate its exposure under a swap agreement
either by assignment or other disposition, or by entering into an
offsetting swap agreement with the same party or a similarly
creditworthy party.
TEMPORARY DEFENSIVE POLICIES. The fund reserves the right to invest
without limitation in preferred stocks and investment-grade debt
instruments for temporary, defensive purposes.
WARRANTS. Warrants are instruments which entitle the holder to buy an
equity security at a specific price for a specific period of time.
Changes in the value of a warrant do not necessarily correspond to
changes in the value of its underlying security. The price of a
warrant may be more volatile than the price of its underlying
security, and a warrant may offer greater potential for capital
appreciation as well as capital loss.
Warrants do not entitle a holder to dividends or voting rights with
respect to the underlying security and do not represent any rights in
the assets of the issuing company. A warrant ceases to have value if
it is not exercised prior to its expiration date. These factors can
make warrants more speculative than other types of investments.
ZERO COUPON BONDS do not make interest payments; instead, they are
sold at a 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 more volatile than other types of
fixed-income securities when interest rates change. In calculating a
fund's dividend, a portion of the difference between a zero coupon
bond's purchase price and its face value is considered income.
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are placed
on behalf of the fund by FMR pursuant to authority contained in the
management contract. FMR is also responsible for the placement of
transaction orders for other investment companies and investment
accounts for which it or its affiliates act as investment adviser. 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; the reasonableness
of any commissions; and, if applicable, arrangements for payment of
fund expenses.
If FMR grants investment management authority to a sub-adviser (see
the section entitled "Management Contract"), that sub-adviser is
authorized to place orders for the purchase and sale of portfolio
securities, and will do so in accordance with the policies described
above.
Generally, commissions for investments traded on foreign exchanges
will be higher than for investments traded on U.S. exchanges and may
not be subject to negotiation.
Futures transactions are executed and cleared through FCMs who
receive commissions for their services.
The fund may execute portfolio transactions with broker-dealers who
provide research and execution services to the fund or other
investment 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 investment accounts; and effect securities transactions
and perform functions incidental thereto (such as clearance and
settlement).
The selection of such broker-dealers for transactions in equity
securities is generally made by FMR (to the extent possible consistent
with execution considerations) in accordance with a ranking of
broker-dealers determined periodically by FMR's investment staff based
upon the quality of research and execution services provided.
For transactions in fixed-income securities, FMR's selection of
broker-dealers is generally based on the availability of a security
and its price and, to a lesser extent, on the overall quality of
execution and other services, including research, provided by the
broker-dealer.
The receipt of research from broker-dealers that execute transactions
on behalf of a fund may be useful to FMR in rendering investment
management services to that fund 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 a fund. 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.
Fixed-income securities are generally purchased from an issuer or
underwriter acting as principal for the securities, on a net basis
with no brokerage commission paid. However, the dealer is compensated
by a difference between the security's original purchase price and the
selling price, the so-called "bid-asked spread." Securities may also
be purchased from underwriters at prices that include underwriting
fees.
Subject to applicable limitations of the federal securities laws, the
fund may pay a broker-dealer 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 fund 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 that fund
or 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.
To the extent permitted by applicable law, FMR is authorized to
allocate portfolio transactions in a manner that takes into account
assistance received in the distribution of shares of the fund or other
Fidelity funds and to use the research services of brokerage and other
firms that have provided such assistance. FMR may use research
services provided by and place agency transactions with National
Financial Services Corporation (NFSC) and Fidelity Brokerage Services
Japan LLC (FBSJ), indirect subsidiaries of FMR Corp., if the
commissions are fair, reasonable, and comparable to commissions
charged by non-affiliated, qualified brokerage firms for similar
services. Prior to December 9, 1997, FMR used research services
provided by and placed agency transactions with Fidelity Brokerage
Services (FBS), an indirect subsidiary of FMR Corp.
FMR may allocate brokerage transactions to broker-dealers (including
affiliates of FMR) who have entered into arrangements with FMR under
which the broker-dealer allocates a portion of the commissions paid by
a fund toward the reduction of that fund's expenses. The transaction
quality must, however, be comparable to those of other qualified
broker-dealers.
Section 11(a) of the Securities Exchange Act of 1934 prohibits members
of national securities exchanges from executing exchange transactions
for investment accounts which they or their affiliates manage, unless
certain requirements are satisfied. Pursuant to such requirements, the
Board of Trustees has authorized NFSC to execute portfolio
transactions on national securities exchanges in accordance with
approved procedures and applicable SEC rules.
The Trustees periodically review FMR's performance of its
responsibilities in connection with the placement of portfolio
transactions on behalf of the fund and review the commissions paid by
the fund over representative periods of time to determine if they are
reasonable in relation to the benefits to the fund.
For the fiscal periods ended March 31 , 2000 and 1999, the
fund's portfolio turnover rates were 28% and 37 %, respectively.
For the fiscal years ended March 31, 2000, 1999, and 1998, the fund
paid brokerage commissions of $27,189,485, $ 36,850,830 , and
$ 28,617,049 , respectively. Significant changes in brokerage
commissions paid by the fund from year to year may result from
changing asset levels throughout the year. The fund may pay both
commissions and spreads in connection with the placement of portfolio
transactions.
During the fiscal years ended March 31 , 2000, 1999, and 1998,
the fund paid brokerage commissions of $1,622,217, $ 4,323,919 ,
and $ 3,546,564 , respectively, to NFSC. NFSC is paid on a
commission basis. During the fiscal year ended March 31 , 2000,
this amounted to approximate ly 5.97% o f the aggregate brokerage
commissions paid by the fund for transactions involving approximately
9.81% of the aggregate dollar amount of transactions for which
the fund paid brokerage commissions. The difference between the
percentage of aggregate brokerage commissions paid to, and the
percentage of the aggregate dollar amount of transactions effected
through, NFSC is a result of the low commission rates charged by NFSC.
During the fiscal years ended March 31 , 2000, 1999, and 1998,
the fund paid brokerage commissions of $0, $ 0 , and
$ 554,850 , respectively, to FBS. FBS is paid on a commission
basis.
During the fiscal year ended March 31, 2000, the fund paid $24,822,019
in brokerage commissions to firms for provid ing research
services involving approximately $28,736,830,321 of
transactions. The provision of research services was not necessarily a
factor in the placement of all this business with such firms.
The Trustees of the fund have approved procedures in conformity with
Rule 10f-3 under the 1940 Act whereby a fund may purchase securities
that are offered in underwritings in which an affiliate of FMR
participates. These procedures prohibit the fund from directly or
indirectly benefiting an FMR affiliate in connection with such
underwritings. In addition, for underwritings where an FMR affiliate
participates as a principal underwriter, certain restrictions may
apply that could, among other things, limit the amount of securities
that the fund could purchase in the underwriting.
From time to time the Trustees will review whether the recapture for
the benefit of the fund of some portion of the brokerage commissions
or similar fees paid by the fund on portfolio transactions is legally
permissible and advisable. The fund seeks to recapture soliciting
broker-dealer fees on the tender of portfolio securities, but at
present no other recapture arrangements are in effect. The Trustees
intend to continue to review whether recapture opportunities are
available and are legally permissible and, if so, to determine in the
exercise of their business judgment whether it would be advisable for
the fund to seek such recapture.
Although the Trustees and officers of the fund are substantially the
same as those of other funds managed by FMR or its affiliates,
investment decisions for the fund are made independently from those of
other funds or investment accounts managed by FMR or its affiliates.
It sometimes happens that the same security is held in the portfolio
of more than one of these funds or investment accounts. Simultaneous
transactions are inevitable when several funds and investment 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 investment 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 the fund is
concerned. In other cases, however, the ability of the fund to
participate in volume transactions will produce better executions and
prices for the fund. It is the current opinion of the Trustees that
the desirability of retaining FMR as investment adviser to the fund
outweighs any disadvantages that may be said to exist from exposure to
simultaneous transactions.
VALUATION
The fund's net asset value per share (NAV) is the value of a single
share. The NAV of the fund is computed by adding the value of the
fund's investments, cash, and other assets, subtracting its
liabilities, and dividing the result by the number of shares
outstanding.
Portfolio securities are valued by various methods depending on the
primary market or exchange on which they trade. Most equity securities
for which the primary market is the United States are valued at last
sale price or, if no sale has occurred, at the closing bid price. Most
equity securities for which the primary market is outside the United
States are valued using the official closing price or the last sale
price in the principal market in which they are traded. If the last
sale price (on the local exchange) is unavailable, the last evaluated
quote or closing bid price normally is used. Securities of other
open-end investment companies are valued at their respective NAVs.
Fixed-income securities and other assets for which market quotations
are readily available may be valued at market values determined by
such securities' most recent bid prices (sales prices if the principal
market is an exchange) in the principal market in which they normally
are traded, as furnished by recognized dealers in such securities or
assets. Or, fixed-income securities and convertible securities may be
valued on the basis of information furnished by a pricing service that
uses a valuation matrix which incorporates both dealer-supplied
valuations and electronic data processing techniques. Use of pricing
services has been approved by the Board of Trustees. A number of
pricing services are available, and the fund may use various pricing
services or discontinue the use of any pricing service.
Futures contracts and options are valued on the basis of market
quotations, if available.
Independent brokers or quotation services provide prices of foreign
securities in their local currency. Fidelity Service Company, Inc.
(FSC) gathers all exchange rates daily at the close of the NYSE using
the last quoted price on the local currency and then translates
the value of foreign securities from their local currencies into U.S.
dollars. Any changes in the value of forward contracts due to exchange
rate fluctuations and days to maturity are included in the calculation
of NAV. If an event that is expected to materially affect the value of
a portfolio security occurs after the close of an exchange or market
on which that security is traded, then that security will be valued in
good faith by a committee appointed by the Board of Trustees.
Short-term securities with remaining maturities of sixty days or less
for which market quotations and information furnished by a pricing
service are not readily available are valued either at amortized cost
or at original cost plus accrued interest, both of which approximate
current value.
The procedures set forth above need not be used to determine the value
of the securities owned by the fund if, in the opinion of a committee
appointed by the Board of Trustees, some other method would more
accurately reflect the fair value of such securities. For example,
securities and other assets for which there is no readily available
market value may be valued in good faith by a committee appointed by
the Board of Trustees. In making a good faith determination of the
value of a security, the committee may review price movements in
futures contracts and ADRs, market and trading trends, the bid/ask
quotes of brokers and off-exchange institutional trading.
PERFORMANCE
The fund may quote performance in various ways. All performance
information supplied by the fund in advertising is historical and is
not intended to indicate future returns. The fund's share price and
return fluctuate in response to market conditions and other factors,
and the value of fund shares when redeemed may be more or less than
their original cost.
RETURN CALCULATIONS. Returns quoted in advertising reflect all aspects
of the fund's return, including the effect of reinvesting dividends
and capital gain distributions, and any change in the fund's NAV over
a stated period. A cumulative return reflects actual performance over
a stated period of time. Average annual returns are calculated by
determining the growth or decline in value of a hypothetical
historical investment in the fund 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 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 the fund's performance is not constant over time,
but changes from year to year, and that average annual returns
represent averaged figures as opposed to the actual year-to-year
performance of the fund.
In addition to average annual returns, the fund may quote unaveraged
or cumulative returns reflecting the simple change in value of an
investment over a stated period. Average annual and cumulative 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. Returns may be broken
down into their components of income and capital (including capital
gains and changes in share price) to illustrate the relationship of
these factors and their contributions to return. Returns may be quoted
on a before-tax or after-tax basis. After-tax returns reflect the
return of a hypothetical account after payment of federal and/or state
taxes using assumed tax rates. After-tax returns may assume that taxes
are paid at the same time of distribution or once a year or are paid
in cash or by selling shares, that shares are held through the entire
period, sold on the last day of the period, or sold at a future date,
and distributions are reinvested or paid in cash. Returns may or
may not include the effect of the fund's maximum sales charge or
the effect of the fund's small account fee. Excluding the fund's
sales charge or small account fee from a return calculation produces a
higher return figure. Returns and other performance information may be
quoted numerically or in a table, graph, or similar illustration.
NET ASSET VALUE. Charts and graphs using the fund's NAVs, adjusted
NAVs, and benchmark indexes may be used to exhibit performance. An
adjusted NAV includes any distributions paid by the fund and reflects
all elements of its return. Unless otherwise indicated, the fund's
adjusted NAVs are not adjusted for sales charges, if any.
MOVING AVERAGES. A fund may illustrate performance using moving
averages. A long-term moving average is the average of each week's
adjusted closing NAV for a specified period. A short-term moving
average is the average of each day's adjusted closing NAV for a
specified period. Moving Average Activity Indicators combine adjusted
closing NAVs from the last business day of each week with moving
averages for a specified period to produce indicators showing when an
NAV has crossed, stayed above, or stayed below its moving average. On
March 31, 2000, the 13-week and 39-week long-term moving averages
were $134.72 and $128.23, respectively, for Magellan.
HISTORICAL FUND RESULTS. The following table shows the fund's returns
for the fiscal periods ended March 31, 2000.
The fund has a maximum front-end sales charge of 3.00% which is
included in the average annual and cumulative returns.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Average Annual Returns Cumulative Returns
One Year Five Years Ten Years One Year Five Years Ten Years
Magellan 17.48% 24.63% 19.37% 17.48% 200.74% 487.56%
</TABLE>
The following table shows the income and capital elements of the
fund's cumulative return. The table compares the fund's return to the
record of the S&P 500, the Dow Jones Industrial Average (DJIA), and
the cost of living, as measured by the Consumer Price Index (CPI),
over the same period. The S&P 500 and DJIA comparisons are provided to
show how the fund's return compared to the record of a market
capitalization-weighted index of common stocks and a narrower set of
stocks of major industrial companies, respectively, over the same
period. The fund has the ability to invest in securities not included
in either index, and its investment portfolio may or may not be
similar in composition to the indexes. The S&P 500 and DJIA returns
are based on the prices of unmanaged groups of stocks and, unlike the
fund's returns, do not include the effect of brokerage commissions or
other costs of investing.
During the 10-year period ended March 31, 2000, a hypothetical $10,000
investment in Magellan would have grown to $58,756 , including
the effect of the fund's maximum sales charge and assuming all
distributions were reinvested. Returns are based on past results and
are not an indication of future performance. Tax consequences of
different investments have not been factored into the figures below.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FIDELITY MAGELLAN FUND INDEXES
Fiscal Year
Ended Value of Initial $10,000 Value of Reinvested Dividend Value of Reinvested Capital Total Value S&P 500
Investment Distributions Gain Distributions
2000 $ 23,714 $ 4,134 $ 30,908 $ 58,756 $ 56,198
1999 $ 21,477 $ 3,461 $ 23,575 $ 48,513 $ 47,648
1998 $ 18,013 $ 2,664 $ 17,938 $ 38,615 $ 40,223
1997 $ 13,275 $ 1,583 $ 11,698 $ 26,556 $ 27,178
1996 $ 14,487 $ 1,344 $ 8,508 $ 24,339 $ 22,682
1995 $ 11,991 $ 971 $ 5,989 $ 18,951 $ 17,170
1994 $ 11,541 $ 901 $ 5,072 $ 17,514 $ 14,858
1993 $ 11,329 $ 710 $ 3,469 $ 15,508 $ 14,642
1992 $ 11,277 $ 427 $ 1,544 $ 13,248 $ 12,704
1991 $ 10,733 $ 169 $ 472 $ 11,374 $ 11,439
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
FIDELITY MAGELLAN FUND
Fiscal Year Ended DJIA Cost of Living
2000 $ 51,612 $ 13,294
1999 $ 45,558 $ 12,821
1998 $ 40,284 $ 12,603
1997 $ 29,635 $ 12,432
1996 $ 24,631 $ 12,098
1995 $ 17,912 $ 11,764
1994 $ 15,247 $ 11,437
1993 $ 14,010 $ 11,158
1992 $ 12,809 $ 10,824
1991 $ 11,180 $ 10,490
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in the fund
on April 1, 1990, assuming the maximum sales charge had been in
effect, the net amount invested in fund shares was $9,700. The cost of
the initial investment ($10,000) together with the agg regate cost
of reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $ 30,367 . If distributions had not been reinvested, the
amount of distributions earned from the fund over time would have been
smaller, and cash payments for the period would have amounted to
$ 1,42 4 for dividends and $10,776 for capital gain
distributions.
AFTER-TAX RESULTS FOR THE FUND. The following table shows the
fund's pre-liquidation and post-liquidation after-tax returns, as
provided by Morningstar, Inc., for the fiscal periods ended March 31,
2000.
The pre-liquidation calculation assumes (i) that taxes are paid on
distributions at the time of the distribution, (ii) that shares were
held for the entire measurement period, and (iii) that no taxes have
been paid on accumulated capital appreciation. The post-liquidation
calculation assumes (i) that taxes are paid on distributions at the
time of the distribution and (ii) that shares have been sold at the
end of the measurement period. The post-liquidation returns also
include the effect of the fund's maximum sales charge.
The pre-liquidation and post-liquidation after-tax calculations
assume the highest individual federal income and capital gains tax
rates in effect at the time the distribution is paid. The applicable
tax rate is applied to distributions as if they were paid in cash and
the remainder of the distribution is assumed to be reinvested in
shares of the fund. State and local taxes are not considered.
The post-liquidation after-tax calculation assumes the long-term
capital gains tax rate on accumulated capital appreciation for all
periods. If there would have been a capital loss on liquidation, the
loss is recorded as a tax benefit, increasing the post-liquidation
return.
Average Annual Returns
Fund Name One Year Five Years Ten Years
Magellan - Pre-Liquidation 18.46% 22.27% 16.61%
Returns
Magellan - Post-Liquidation 13.32% 19.32% 15.02%
Returns
PERFORMANCE COMPARISONS. The 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 Inc. (Lipper), an
independent service located in Summit, New Jersey that monitors the
performance of mutual funds. Generally, Lipper rankings are based on
return, assume reinvestment of distributions, do not take sales
charges or trading fees into consideration, and are prepared without
regard to tax consequences. In addition to the mutual fund rankings,
the fund's performance may be compared to stock, bond, and money
market mutual fund performance indexes prepared by Lipper or other
organizations. When comparing these indexes, 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, the 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.
The fund's performance may also be compared to that of the benchmark
index representing the universe of securities in which the fund may
invest. The return of the index reflects reinvestment of all dividends
and capital gains paid by securities included in the index. Unlike the
fund's returns, however, the index's returns do not reflect brokerage
commissions, transaction fees, or other costs of investing directly in
the securities included in the index.
The fund may compare its performance to that of the Standard & Poor's
500 Index, a market capitalization-weighted index of common stocks.
The 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, the fund may offer greater liquidity or higher
potential returns than CDs, the fund does not guarantee an
investor's principal or 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 project 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 indexes.
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 returns in the
same method as the funds. The funds may also compare performance to
that of other compilations or indexes that may be developed and made
available in the future.
In advertising materials, Fidelity may reference or discuss its
products and services, which may include other Fidelity funds;
retirement investing; brokerage products and services; model
portfolios or allocations; saving for college or other goals; and
charitable giving. In addition, Fidelity may quote or reprint
financial or business publications and periodicals as they relate to
current economic and political conditions, fund management, portfolio
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(registered trademark),
a quarterly magazine provided free of charge to Fidelity fund
shareholders.
The fund may present its fund number, Quotron(trademark) number, and
CUSIP number, and discuss or quote its current portfolio manager.
VOLATILITY. The fund may quote various measures of volatility and
benchmark correlation in advertising. In addition, the fund may
compare these measures to those of other funds. Measures of volatility
seek to compare the fund's historical share price fluctuations or
returns to those of a benchmark. Measures of benchmark correlation
indicate how valid a comparative benchmark may be. All measures of
volatility and correlation are calculated using averages of historical
data.
MOMENTUM INDICATORS indicate the fund's price movements over specific
periods of time. Each point on the momentum indicator represents the
fund's percentage change in price movements over that period.
The fund may advertise examples of the effects of periodic investment
plans, including the principle of dollar cost averaging. In such a
program, an investor invests a fixed dollar amount in a fund at
periodic intervals, thereby purchasing fewer shares when prices are
high and more shares when prices are low. While such a strategy does
not assure a profit or guard against loss in a declining market, the
investor's average cost per share can be lower than if fixed numbers
of shares are purchased at the same intervals. In evaluating such a
plan, investors should consider their ability to continue purchasing
shares during periods of low price levels.
A s of March 31, 2000, FMR advised over $36 billion in municipal
fund assets, $142 billion in taxable fixed-income fund assets, $150
billion in money market fund assets, $664 billion in equity fund
assets, $23 billion in international fund assets, and $43 billion
in Spartan(registered trademark) fund assets. The fund 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.
ADDITIONAL PURCHASE, EXCHANGE AND REDEMPTION INFORMATION
Pursuant to Rule 22d-1 under the 1940 Act, Fidelity Distributors
Corporation (FDC) exercises its right to waive the fund's front-end
sales charge on shares acquired through reinvestment of dividends and
capital gain distributions or in connection with a fund's merger with
or acquisition of any investment company or trust. In addition, FDC
has chosen to waive the fund's front-end sales charge in certain
instances due to sales efficiencies and competitive considerations.
The sales charge will not apply:
1. to shares purchased in connection with an employee benefit plan
(including the Fidelity-sponsored 403(b) and corporate IRA programs
but otherwise as defined in the Employee Retirement Income Security
Act) maintained by a U.S. employer and having more than 200 eligible
employees, or a minimum of $3,000,000 in plan assets invested in
Fidelity mutual funds, or as part of an employee benefit plan
maintained by a U.S. employer that is a member of a parent-subsidiary
group of corporations (within the meaning of Section 1563(a)(1) of the
Internal Revenue Code, with "50%" substituted for "80%") any member of
which maintains an employee benefit plan having more than 200 eligible
employees, or a minimum of $3,000,000 in plan assets invested in
Fidelity mutual funds, or as part of an employee benefit plan
maintained by a non-U.S. employer having 200 or more eligible
employees, or a minimum of $3,000,000 in assets invested in Fidelity
mutual funds, the assets of which are held in a bona fide trust for
the exclusive benefit of employees participating therein;
2. to shares purchased by an insurance company separate account used
to fund annuity contracts purchased by employee benefit plans
(including 403(b) programs, but otherwise as defined in the Employee
Retirement Income Security Act), which, in the aggregate, have either
more than 200 eligible employees or a minimum of $3,000,000 in assets
invested in Fidelity funds;
3. to shares in a Fidelity account purchased (including purchases by
exchange) with the proceeds of a distribution from an employee benefit
plan provided that: (i) at the time of the distribution, the employer,
or an affiliate (as described in waiver (1) above) of such employer,
maintained at least one employee benefit plan that qualified for
waiver (1) above and that had at least some portion of its assets
invested in one or more mutual funds advised by FMR, or in one or more
investment accounts or pools advised by Fidelity Management Trust
Company; and (ii) either (a) the distribution is transferred from the
plan to a Fidelity IRA account within 60 days from the date of the
distribution or (b) the distribution is transferred directly from the
plan into another Fidelity account;
4. to shares purchased by a charitable organization (as defined for
purposes of Section 501(c)(3) of the Internal Revenue Code) investing
$100,000 or more;
5. to shares purchased for a charitable remainder trust or life income
pool established for the benefit of a charitable organization (as
defined for purposes of Section 501(c)(3) of the Internal Revenue
Code);
6. to shares purchased by an investor participating in the Fidelity
Trust Portfolios program (these investors must make initial
investments of $100,000 or more in the Trust Portfolios funds and
must, during the initial six-month period, reach and maintain an
aggregate balance of at least $500,000 in all accounts and subaccounts
purchased through the Trust Portfolios program);
7. to shares purchased by a mutual fund or a qualified state tuition
program for which FMR or an affiliate serves as investment manager;
8. to shares purchased through Portfolio Advisory Services SM or
Fidelity Charitable Advisory Services;
9. to shares purchased by a current or former Trustee or officer of a
Fidelity fund or a current or retired officer, director, or regular
employee of FMR Corp. or Fidelity International Limited (FIL) or their
direct or indirect subsidiaries (a Fidelity Trustee or employee), the
spouse of a Fidelity Trustee or employee, a Fidelity Trustee or
employee acting as custodian for a minor child, or a person acting as
trustee of a trust for the sole benefit of the minor child of a
Fidelity Trustee or employee; or
10. to shares purchased by a bank trust officer, registered
representative, or other employee of a qualified recipient. Qualified
recipients are securities dealers or other entities, including banks
and other financial institutions, who have sold the fund's shares
under special arrangements in connection with FDC's sales activities.
The fund's sales charge may be reduced to reflect sales charges
previously paid, or that would have been paid absent a reduction for
some purchases made directly with Fidelity as noted in the prospectus,
in connection with investments in other Fidelity funds. This includes
reductions for investments in the following prototype or
prototype-like retirement plans sponsored by FMR or FMR Corp.: The
Fidelity Traditional IRA, The Fidelity Roth IRA, The Fidelity Rollover
IRA, The Fidelity SEP-IRA and SARSEP, The Fidelity SIMPLE IRA, The
Fidelity Retirement Plan, Fidelity Defined Benefit Plan, The Fidelity
Group IRA, The Fidelity 403(b) Program, The Fidelity Investments
401(a) Prototype Plan for Tax-Exempt Employers, and The CORPORATE plan
for Retirement SM (Profit Sharing and Money Purchase Plan).
The fund may make redemption payments in whole or in part in readily
marketable securities or other property, valued for this purpose as
they are valued in computing the fund's NAV, if FMR determines it is
in the best interests of the fund. Shareholders that receive
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.
DISTRIBUTIONS AND TAXES
DIVIDENDS. A portion of the fund's income may qualify for the
dividends-received deduction available to corporate shareholders to
the extent that the fund's income is derived from qualifying
dividends. Because the fund may earn other types of income, such as
interest, short-term capital gains, and non-qualifying dividends, the
percentage of dividends from the fund that qualifies for the deduction
generally will be less than 100%. A portion of the fund's dividends
derived from certain U.S. Government securities and securities of
certain other investment companies may be exempt from state and local
taxation.
CAPITAL GAIN DISTRIBUTIONS. The fund's long-term capital gain
distributions are federally taxable to shareholders generally as
capital gains.
RETURNS OF CAPITAL. If the fund's distributions exceed its
taxable income and capital gains realized during a taxable year, all
or a portion of the distributions made in the same taxable year may be
recharacterized as a return of capital to shareholders. A return of
capital distribution will generally not be taxable, but will reduce
each shareholder's cost basis in the fund and result in a higher
reported capital gain or lower reported capital loss when those shares
on which the distribution was received are sold.
FOREIGN TAX CREDIT OR DEDUCTION. Foreign governments may withhold
taxes on dividends and interest earned by the fund with respect to
foreign securities. Foreign governments may also impose taxes on other
payments or gains with respect to foreign securities. Because the fund
does not currently anticipate that securities of foreign issuers will
constitute more than 50% of its total assets at the end of its fiscal
year, shareholders should not expect to be eligible to claim a foreign
tax credit or deduction on their federal income tax returns with
respect to foreign taxes withheld.
TAX STATUS OF THE FUND. The fund intends to qualify each year as a
"regulated investment company" under Subchapter M of the Internal
Revenue Code 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, the 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, and intends to comply with other tax rules
applicable to regulated investment companies.
OTHER TAX INFORMATION. The information above is only a summary of some
of the tax consequences generally affecting the fund and its
shareholders, and no attempt has been made to discuss individual tax
consequences. It is up to you or your tax preparer to determine
whether the sale of shares of the fund resulted in a capital gain or
loss or other tax consequence to you. 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.
TRUSTEES AND OFFICERS
The Trustees, Member of the Advisory Board, and executive officers of
the trust and fund, as applicable, are listed below. The Board
of Trustees governs the fund and is responsible for protecting the
interests of shareholders. The Trustees are experienced executives who
meet periodically throughout the year to oversee the fund's
activities, review contractual arrangements with companies that
provide services to the fund, and review the fund's performance.
Except as indicated, each individual has held the office shown or
other offices in the same company for the last five years. All persons
named as Trustee s and Members of the Advisory Board als o serve
in similar capacities for other funds advised by FMR or its
affiliates. The business address of each Trustee, Member of the
Advisory Board, and officer who is an "interested person" (as
defined in the 1940 Act) is 82 Devonshire Street, Boston,
Massachusetts 02109, which is also the address of FMR. The business
address of all the other Trustees is Fidelity Investments(registered
trademark), P.O. Box 9235, Boston, Massachusetts 02205-9235. Those
Trustees who are "interested persons" by virtue of their affiliation
with either the trust or FMR are indicated by an asterisk (*).
*EDWARD C. JOHNSON 3d (69), Trustee, is President of Fidelity
Magellan Fund. Mr. Johnson also serves as President of other Fidelity
funds. He is Chief Executive Officer , Chairman, and a
Director of FMR Corp.; a Director and Chairman of the Board and of the
Executive Committee of FMR; Chairman and a Director of Fidelity
Management & Research (U.K.) Inc. and of Fidelity Management &
Research (Far East) Inc.; Chairman (1998) and a Director (1997) of
Fidelit y Investments Money Management, Inc.; Chairman and
Representative Director of Fidelity Investments Japan Limited
(1997); and a Director of FDC and of FMR Co., Inc. (2000) .
Abigail Johnson, Vice President of Fidelity Magellan Fund, is Mr.
Johnson's daughter.
ABIGAIL P. JOHNSON (38), is Vice President of certain Equity Funds
(1997), and is a Director of FMR Corp. (1994). Before assuming her
current responsibilities, Ms. Johnson managed a number of Fidelity
funds. Edward C. Johnson 3d, Trustee and President of the Funds, is
Ms. Johnson's father.
J. MICHAEL COOK (57), Member of the Advisory Board (2000). Prior to
Mr. Cook's retirement in May 1999, he served as Chairman and Chief
Executive Officer of Deloitte & Touche LLP, Chairman of the Deloitte &
Touche Foundation, and a member of the Board of Deloitte Touche
Tohmatsu. He currently serves as an Executive in Residence of the
Columbia Business School and as a Director of Dow Chemical Company
(2000), Columbia/HCA Healthcare Corporation (1999), and Children First
(1999). He is a member of the Executive Committee of the Securities
Regulation Institute, a member of the Advisory Board of Boardroom
Consultants, a Director of the National Forum for Health Care Quality,
Measurement and Reporting, past chairman and a member of the Board of
Catalyst (a leading organization for the advancement of women in
business), and is a Director of the STAR Foundation (Society to
Advance the Retarded and Handicapped). He also serves as a member of
the Board and Executive Committee and as Co-Chairman of the Audit and
Finance Committee of the Center for Strategic & International Studies,
a member of the Board of Overseers of the Columbia Business School,
and a Member of the Advisory Board of the Graduate School of Business
of the University of Florida.
RALPH F. COX (67), Trustee, is President of RABAR Enterprises
(management consulting-engineering industry, 1994). Prior to February
1994, he was President of Greenhill Petroleum Corporation (petroleum
exploration and production). Until March 1990, Mr. Cox was President
and Chief Operating Officer of Union Pacific Resources Company
(exploration and production). He is a Director of Waste Management
Inc. (non-hazardous waste, 1993), CH2M Hill Companies (engineering),
and Bonneville Pacific (independent power and petroleum production).
In addition, he is a member of advisory boards of Texas A&M University
and the University of Texas at Austin.
PHYLLIS BURKE DAVIS (68), Trustee. Mrs. Davis is retired from Avon
Products, Inc. where she held various positions including Senior Vice
President of Corporate Affairs and Group Vice President of U.S. sales,
distribution, and manufacturing. She is currently a Director of
BellSouth Corporation (telecommunications), Eaton Corporation
(manufacturing), and the TJX Companies, Inc. (retail stores), and
previously served as a Director of Hallmark Cards, Inc., Nabisco
Brands, Inc., and Standard Brands, Inc. In addition, she is a member
of the Board of Directors of the Southampton Hospital in Southampton,
N.Y. (1998).
ROBERT M. GATES (56), Trustee (1997), is a consultant, author, and
lecturer (1993). Mr. Gates was Director of the Central Intelligence
Agency (CIA) from 1991-1993. From 1989 to 1991, Mr. Gates served as
Assistant to the President of the United States and Deputy National
Security Advisor. Mr. Gates is a Director of Charles Stark Draper
Laboratory (non-profit), NACCO Industries, Inc. (mining and
manufacturing), and TRW Inc. (automotive, space, defense, and
information technology). Mr. Gates previously served as a Director of
LucasVarity PLC (automotive components and diesel engines). He is
currently serving as Dean of the George Bush School of Government and
Public Service at Texas A & M University (1999-2000). Mr. Gates also
is a Trustee of the Forum for International Policy and of the
Endowment Association of the College of William and Mary. In addition,
he is a member of the National Executive Board of the Boy Scouts of
America.
DONALD J. KIRK (67), Trustee, is Executive-in-Residence (1995) at
Columbia University Graduate School of Business. From 1987 to January
1995, Mr. Kirk was a Professor at Columbia University Graduate School
of Business. Prior to 1987, he was Chairman of the Financial
Accounting Standards Board. Mr. Kirk previously served as a Director
of General Re Corporation (reinsurance, 1987-1998) and as a Director
of Valuation Research Corp. (appraisals and valuations, 1993-1995). He
serves as Chairman of the Board of Directors of National Arts
Stabilization Inc., Chairman of the Board of Trustees of the Greenwich
Hospital Association, Director of the Yale-New Haven Health Services
Corp. (1998), Vice Chairman of the Public Oversight Board of the
American Institute of Certified Public Accountants' SEC Practice
Section (1995), and as a Public Governor of the National Association
of Securities Dealers, Inc. (1996).
NED C. LAUTENBACH (56), Trustee (2000), has been a partner of Clayton,
Dubilier & Rice, Inc. (private equity investment firm) since September
1998. Mr. Lautenbach was Senior Vice President of IBM Corporation from
1992 until his retirement in July 1998. From 1993 to 1995 he was
Chairman of IBM World Trade Corporation. He also was a member of IBM's
Corporate Executive Committee from 1994 to July 1998. He is a Director
of PPG Industries Inc. (glass, coating and chemical manufacturer),
Dynatech Corporation (global communications equipment), Eaton
Corporation (global manufacturer of highly engineered products) and
ChoicePoint Inc. (data identification, retrieval, storage, and
analysis).
*PETER S. LYNCH (57), Trustee, is Vice Chairman and a Director of
FMR ; and a Director of FMR Co., Inc. (2000). Prior to May 31,
1990, he was a Director of FMR and Executive Vice President of FMR (a
position he held until March 31, 1991); Vice President of Fidelity
Magellan Fund and FMR Growth Group Leader; and Managing Director of
FMR Corp. Mr. Lynch was also Vice President of Fidelity Investments
Corporate Services (1991-1992). In addition, he serves as a Trustee of
Boston College, Massachusetts Eye & Ear Infirmary, Historic Deerfield
(1989) and Society for the Preservation of New England Antiquities,
and as an Overseer of the Museum of Fine Arts of Boston.
WILLIAM O. McCOY (66), Trustee (1997), is the Interim Chancellor for
the University of North Carolina at Chapel Hill. Previously he had
served from 1995 through 1998 as Vice President of Finance for the
University of North Carolina (16-school system). Prior to his
retirement in December 1994, Mr. McCoy was Vice Chairman of the Board
of BellSouth Corporation (telecommunications, 1984) and President of
BellSouth Enterprises (1986). He is currently a Director of Liberty
Corporation (holding company, 1984), Duke-Weeks Realty Corporation
(real estate, 1994), Carolina Power and Light Company (electric
utility, 1996), the Kenan Transport Company (trucking, 1996), and
Dynatech Corporation (electronics, 1999). Previously, he was a
Director of First American Corporation (bank holding company,
1979-1996). In addition, Mr. McCoy served as a member of the Board of
Visitors for the University of North Carolina at Chapel Hill
(1994-1998) and currently serves on the Board of Visitors of the
Kenan-Flager Business School (University of North Carolina at Chapel
Hill, 1988).
GERALD C. McDONOUGH (71), Trustee and Chairman of the non-interested
Trustees, is Chairman of G.M. Management Group (strategic advisory
services). Mr. McDonough is a Director and Chairman of the Board of
York International Corp. (air conditioning and refrigeration) and
Associated Estates Realty Corporation (a real estate investment trust,
1993). Mr. McDonough served as a Director of ACME-Cleveland Corp.
(metal working, telecommunications, and electronic products) from
1987-1996 and Brush-Wellman Inc. (metal refining) from 1983-1997.
He also served as Director of Commercial Intertech Corp. (hydraulic
systems, building systems, and metal products) from 1992-2000 and
CUNO, Inc. (liquid and gas filtration products) from 1996-2000.
MARVIN L. MANN (66), Trustee (1993), is Chairman Emeritus of Lexmark
International, Inc. (office machines, 1991) where he still remains a
member of the Board. Prior to 1991, he held the positions of Vice
President of International Business Machines Corporation ("IBM") and
President and General Manager of various IBM divisions and
subsidiaries. Mr. Mann is a Director of M.A. Hanna Company (chemicals,
1993), Imation Corp. (imaging and information storage, 1997). He is a
Board member of Dynatech Corporation (electronics, 1999).
*ROBERT C. POZEN (53), Trustee (1997), is Senior Vice President
of Fidelity Magellan Fund (1997). Mr. Pozen also serves as Senior
Vice President of other Fidelity funds (1997). He is President and
a Director of FMR (1997), Fidelity Management & Research (U.K.) Inc.
(1997), Fidelity Management & Research (Far East) Inc. (1997),
Fidelity Investments Money Management, Inc. (1998), and FMR Co.,
Inc. (2000); and a Director of Strategic Advisers, Inc. (1999) .
Previously, Mr. Pozen served as General Counsel, Managing Director,
and Senior Vice President of FMR Corp.
THOMAS R. WILLIAMS (71), 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 National Life Insurance Company of Vermont and American Software,
Inc. Mr. Williams was previously a Director of ConAgra, Inc.
(agricultural products), Georgia Power Company (electric utility), and
Avado, Inc. (restaurants).
ROBERT E. STANSKY (44), is Vice President of Fidelity Magellan Fund
(1996). Prior to his current responsibilities, Mr. Stansky managed a
variety of Fidelity funds.
ERIC D. ROITER (51), is Secretary of Fidelity Magellan Fund
( 1998). He also serves as Secretary of other Fidelity funds
(1998); Vice President , General Counsel, and Clerk
of FMR (1998); and Vice President and Clerk of FDC (1998). Prior to
joining Fidelity, Mr. Roiter was with the law firm of Debevoise &
Plimpton, as an associate (1981-1984) and as a partner (1985-1997),
and served as an Assistant General Counsel of the U.S. Securities and
Exchange Commission (1979-1981). Mr. Roiter was an Adjunct Member,
Faculty of Law, at Columbia University Law School (1996-1997).
ROBERT A. DWIGHT (41), is Treasurer of Fidelity Magellan Fund
(2000). Mr. Dwight also serves as Treasurer of other Fidelity
funds (2000) and is an employee of FMR. Prior to becoming
Treasurer of the Fidelity funds, he served as President of Fidelity
Accounting and Custody Services (FACS). Before joining Fidelity, Mr.
Dwight was Senior Vice President of fund accounting operations for The
Boston Company.
MARIA F. DWYER (41), is Deputy Treasurer of Fidelity
Magellan Fund (2000). She also serves as Deputy Treasurer
of other Fidelity funds (2000) and is a Vice President
(1999) and an employee (1996) of FMR. Prior to joining Fidelity, Ms.
Dwyer served as Director of Compliance for MFS Investment Management.
MATTHEW N. KARSTETTER (38), is Deputy Treasurer of Fidelity
Magellan Fund (1998). He also serves as Deputy Treasurer of
other Fidelity funds ( 1998) and is an employee of FMR
(1998). Before joining FMR, Mr. Karstetter served as Vice President of
Investment Accounting and Treasurer of IDS Mutual Funds at American
Express Financial Advisors (1996-1998). Prior to 1996, Mr. Karstetter
was Vice President, Mutual Fund Services at State Street Bank & Trust
(1991-1996).
JOHN H. COSTELLO (53), is Assistant Treasurer of Fidelity
Magellan Fund. Mr. Costello also serves as Assistant Treasurer of
other Fidelity funds and is an employee of FMR.
The following table sets forth information describing the compensation
of each Trustee and Member of the Advisory Board of the fund
for his or her services for the fiscal year ended March 31, 2000, or
calendar year ended December 31, 1999, as applicable.
COMPENSATION TABLE
<TABLE>
<CAPTION>
<S> <C> <C>
Trustees and Member of the Aggregate Compensation from Total Compensation from the
Advisory Board MagellanB,C,D Fund Complex*,A
Edward C. Johnson 3d** $ 0 $ 0
J. Michael Cook***** $ 2,628 $ 0
Ralph F. Cox $ 26,968 $ 217,500
Phyllis Burke Davis $ 26,593 $ 211,500
Robert M. Gates $ 26,963 $ 217,500
E. Bradley Jones**** $ 19,592 $ 217,500
Donald J. Kirk $ 26,982 $ 217,500
Ned C. Lautenbach*** $ 13,789 $ 54,000
Peter S. Lynch** $ 0 $ 0
William O. McCoy $ 26,614 $ 214,500
Gerald C. McDonough $ 33,757 $ 269,000
Marvin L. Mann $ 27,148 $ 217,500
Robert C. Pozen** $ 0 $ 0
Thomas R. Williams $ 26,426 $ 213,000
</TABLE>
* Information is for the calendar year ended December 31, 1999 for 236
funds in the complex.
** Interested Trustees of the fund are compensated by FMR.
*** During the period from October 14, 1999 through December 31, 1999,
Mr. Lautenbach served as a Member of the Advisory Board. Effective
January 1, 2000, Mr. Lautenbach serves as a Member of the Board of
Trustees.
**** Mr. Jones served on the Board of Trustees through December 31,
1999.
***** Effective March 16 , 2000, Mr. Cook serves as a Member of
the Advisory Board.
A Compensation figures include cash, amounts required to be deferred,
and may include amounts deferred at the election of Trustees. For the
calendar year ended December 31, 1999, the Trustees accrued required
deferred compensation from the funds as follows: Ralph F. Cox,
$75,000; Phyllis Burke Davis, $75,000; Robert M. Gates, $75,000; E.
Bradley Jones, $75,000; Donald J. Kirk, $75,000; William O. McCoy,
$75,000; Gerald C. McDonough, $87,500; Marvin L. Mann, $75,000; and
Thomas R. Williams, $75,000. Certain of the non-interested Trustees
elected voluntarily to defer a portion of their compensation as
follows: Ralph F. Cox, $53,735; William O. McCoy, $53,735; and Thomas
R. Williams, $62,319.
B Compensation figures include cash, and may include amounts required
to be deferred and amounts deferred at the election of Trustees.
C The following amounts are required to be deferred by each
non-interested Trustee: Ralph F. Cox, $13,665; Phyllis Burke Davis,
$13,665; Robert M. Gates, $13,665; E. Bradley Jones, $9,147; Donald J.
Kirk, $13,665; William O. McCoy, $13,665; Gerald C. McDonough,
$16,411; Marvin L. Mann, $13,665; and Thomas R. Williams, $13,665.
D Certain of the non-interested Trustees' aggregate compensation from
the fund includes accrued voluntary deferred compensation as
foll ows: Ralph F. Cox, $9,557; Ned C. Lautenbach, $1,983; William
O. McCoy, $9,557; and Thomas R. Williams, $9,557.
Under a deferred compensation plan adopted in September 1995 and
amended in November 1996 and January 2000 (the Plan), non-interested
Trustees must defer receipt of a portion of, and may elect to defer
receipt of an additional portion of, their annual fees. Amounts
deferred under the Plan are treated as though equivalent dollar
amounts had been invested in shares of a cross-section of Fidelity
funds including funds in each major investment discipline and
representing a majority of Fidelity's assets under management (the
Reference Funds). The amounts ultimately received by the Trustees
under the Plan will be directly linked to the investment performance
of the Reference Funds. Deferral of fees in accordance with the Plan
will have a negligible effect on a fund's assets, liabilities, and net
income per share, and will not obligate a fund to retain the services
of any Trustee or to pay any particular level of compensation to the
Trustee. A fund may invest in the Reference Funds under the Plan
without shareholder approval.
As of March 31, 2000, the Trustees, Member of the Advisory Board,
and officers of the fund owned, in the aggregate, less than 1% of the
fund's total outstanding shar es.
CONTROL OF INVESTMENT ADVISERS
FMR Corp., organized in 1972, is the ultimate parent company of FMR,
Fidelity Management & Research (U.K.) Inc. (FMR U.K.), Fidelity
Management & Research (Far East) Inc. (FMR Far East) and FMR Co., Inc.
(FMRC). The voting common stock of FMR Corp. is divided into two
classes. Class B is held predominantly by members of the Edward C.
Johnson 3d family and is entitled to 49% of the vote on any matter
acted upon by the voting common stock. Class A is held predominantly
by non-Johnson family member employees of FMR Corp. and its affiliates
and is entitled to 51% of the vote on any such matter. The Johnson
family group and all other Class B shareholders have entered into a
shareholders' voting agreement under which all Class B shares will be
voted in accordance with the majority vote of Class B shares. Under
the 1940 Act, control of a company is presumed where one individual or
group of individuals owns more than 25% of the voting stock of that
company. Therefore, through their ownership of voting common stock and
the execution of the shareholders' voting agreement, members of the
Johnson family may be deemed, under the 1940 Act, to form a
controlling group with respect to FMR Corp.
At present, the principal operating activities of FMR Corp. are those
conducted by its division, Fidelity Investments Retail Marketing
Company, which provides marketing services to various companies within
the Fidelity organization.
FIL, a Bermuda company formed in 1968, is the ultimate parent company
of Fidelity Investments Japan Limited (FIJ). Edward C. 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. FIL provides investment advisory services
to non-U.S. investment companies and institutional investors investing
in securities throughout the world.
The fund, FMR, FMRC, FMR U.K., FMR Far East, FIJ, and FDC have adopted
a code of ethics under Rule 17j-1 of the 1940 Act that sets forth
employees' fiduciary responsibilities regarding the fund, establishes
procedures for personal investing, and restricts certain transactions.
Employees subject to the code of ethics, including Fidelity investment
personnel, may invest in securities for their own investment accounts,
including securities that may be purchased or held by the fund.
MANAGEMENT CONTRACT
The fund has entered into a management contract with FMR, pursuant to
which FMR furnishes investment advisory and other services.
MANAGEMENT SERVICES. Under the terms of its management contract with
the fund, FMR acts as investment adviser and, subject to the
supervision of the Board of Trustees, directs the investments of the
fund in accordance with its investment objective, policies and
limitations. FMR also provides the fund with all necessary office
facilities and personnel for servicing the fund's investments,
compensates all officers of the fund and all Trustees who are
"interested persons" of the trust or of FMR, and all personnel of the
fund or FMR performing services relating to research, statistical and
investment activities.
In addition, FMR or its affiliates, subject to the supervision of the
Board of Trustees, provide the management and administrative services
necessary for the operation of the fund. These services include
providing facilities for maintaining the fund's organization;
supervising relations with custodians, transfer and pricing agents,
accountants, underwriters and other persons dealing with the fund;
preparing all general shareholder communications and conducting
shareholder relations; maintaining the fund's records and the
registration of the fund's shares under federal securities laws and
making necessary filings under state securities laws; developing
management and shareholder services for the fund; and furnishing
reports, evaluations and analyses on a variety of subjects to the
Trustees.
MANAGEMENT-RELATED EXPENSES. In addition to the management fee payable
to FMR and the fees payable to the transfer, dividend disbursing, and
shareholder servicing agent, pricing and bookkeeping agent, and the
costs associated with securities lending, as applicable, the fund pays
all of its expenses that are not assumed by those parties. The 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. The fund's management contract
further provides that the fund will pay for typesetting, printing, and
mailing prospectuses, statements of additional information, notices,
and reports to shareholders; however, under the terms of the fund's
transfer agent agreement, the transfer agent bears the costs of
providing these services to existing shareholders. Other expenses paid
by the fund include interest, taxes, brokerage commissions, the fund's
proportionate share of insurance premiums and Investment Company
Institute dues, and the costs of registering shares under federal
securities laws and making necessary filings under state securities
laws. The fund is also liable for such non-recurring expenses as may
arise, including costs of any litigation to which the fund may be a
party, and any obligation it may have to indemnify its officers and
Trustees with respect to litigation.
MANAGEMENT FEE. For the services of FMR under the management contract,
the fund pays FMR a monthly management fee which has two components: a
basic fee, which is the sum of a group fee rate and an individual fund
fee rate, and a performance adjustment based on a comparison of the
fund's performance to that of the S&P 500.
The group fee rate is based on the monthly average net assets of all
of the registered investment companies with which FMR has management
contracts.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES
Average Group Assets Annualized Rate Group Net Assets Effective Annual Fee Rate
0 - $3 billion .5200% $ 1 billion .5200%
3 - 6 .4900 50 .3823
6 - 9 .4600 100 .3512
9 - 12 .4300 150 .3371
12 - 15 .4000 200 .3284
15 - 18 .3850 250 .3219
18 - 21 .3700 300 .3163
21 - 24 .3600 350 .3113
24 - 30 .3500 400 .3067
30 - 36 .3450 450 .3024
36 - 42 .3400 500 .2982
42 - 48 .3350 550 .2942
48 - 66 .3250 600 .2904
66 - 84 .3200 650 .2870
84 - 102 .3150 700 .2838
102 - 138 .3100 750 .2809
138 - 174 .3050 800 .2782
174 - 210 .3000 850 .2756
210 - 246 .2950 900 .2732
246 - 282 .2900 950 .2710
282 - 318 .2850 1,000 .2689
318 - 354 .2800 1,050 .2669
354 - 390 .2750 1,100 .2649
390 - 426 .2700 1,150 .2631
426 - 462 .2650 1,200 .2614
462 - 498 .2600 1,250 .2597
498 - 534 .2550 1,300 .2581
534 - 587 .2500 1,350 .2566
587 - 646 .2463 1,400 .2551
646 - 711 .2426
711 - 782 .2389
782 - 860 .2352
860 - 946 .2315
946 - 1,041 .2278
1,041 - 1,145 .2241
1,145 - 1,260 .2204
Over 1,260 .2167
</TABLE>
The group fee rate is calculated on a cumulative basis pursuant to the
graduated fee rate schedule shown above on the left. The schedule
above on the right shows the effective annual group fee rate at
various asset levels, which is the result of cumulatively applying the
annualized rates on the left. For ex ample, the effective annual fee
rate at $888 billion of group net assets - the approximate level for
March 2000 - was 0.2738%, which is the weighted average of the
respective fee rates for each level of group net assets up to $888
billion.
The fund's individual fund fee rate is 0.30%. Based on the
average group net assets of the funds advised by FMR for March 2000,
the fund's annual basic fee rate would be calculated as follows:
Group Fee Rate Individual Fund Fee Rate Basic Fee Rate
Magellan 0.2738% + 0.30% = 0.5738%
One-twelfth of the basic fee rate is applied to the fund's average net
assets for the month, giving a dollar amount which is the fee for that
month.
COMPUTING THE PERFORMANCE ADJUSTMENT. The basic fee for Magellan is
subject to upward or downward adjustment, depending upon whether, and
to what extent, the fund's investment performance for the performance
period exceeds, or is exceeded by, the record over the same period of
the S&P 500 (the Index) for Magellan. The performance period consists
of the most recent month plus the previous 35 months.
The performance comparison is made at the end of each month.
Each percentage point of difference, calculated to the nearest 0.01%
(up to a maximum difference of (plus/minus)10.00) is multiplied by a
performance adjustment rate of 0.02%. The maximum annualized
performance adjustment rate is (plus/minus)0.20% of the fund's average
net assets over the performance period.
One twelfth (1/12) of this rate is then applied to the fund's average
net assets over the performance period, giving a dollar amount which
will be added to (or subtracted from) the basic fee.
The fund's performance is calculated based on change in NAV. For
purposes of calculating the performance adjustment, any dividends or
capital gain distributions paid by the fund are treated as if
reinvested in that fund's shares at the NAV as of the record date for
payment.
The record of the Index is based on change in value and is adjusted
for any cash distributions from the companies whose securities compose
the Index. Because the adjustment to the basic fee is based on the
fund's performance compared to the investment record of the Index, the
controlling factor is not whether the fund's performance is up or down
per se, but whether it is up or down more or less than the record of
the Index. Moreover, the comparative investment performance of the
fund is based solely on the relevant performance period without regard
to the cumulative performance over a longer or shorter period of time.
For the fiscal years ended March 31, 2000, 1999, and 1998, the fund
paid FMR management fees of $553,993,000, $ 325,813,000 , and
$ 264,040,000 , respectively. The amount of these management fees
includes both the basic fee and the amount of the performance
adjustment, if any. For the fiscal years ended March 31, 2 000,
1999, and 1998 the downward performance adjustments amounted to
$11,228,000, $119,834,000, and $ 102,362,000 , respectively.
FMR may, from time to time, voluntarily reimburse all or a portion of
the fund's operating expenses (exclusive of interest, taxes, certain
securities lending costs, brokerage commissions, and extraordinary
expenses), which is subject to revision or discontinuance. 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 the fund's returns, and
repayment of the reimbursement by the fund will lower its returns.
SUB-ADVISERS. On January 1, 2001, FMR will enter into a sub-advisory
agreement with FMRC on behalf of the fund pursuant to which FMRC will
have primary responsibility for choosing investments for the fund.
Under the terms of the sub-advisory agreement for the fund, FMR will
pay FMRC fees equal to 50% of the management fee (including any
performance adjustment) payable to FMR under its management contract
with the fund. The fees paid to FMRC will not be reduced by any
voluntary or mandatory expense reimbursements that may be in effect
from time to time.
On behalf of Magellan, FMR has entered into sub-advisory agreements
with FMR U.K. and FMR Far East. Pursuant to the sub-advisory
agreements, FMR may receive from the sub-advisers investment research
and advice on issuers outside the United States and FMR may grant the
sub-advisers investment management authority as well as the authority
to buy and sell securities if FMR believes it would be beneficial to
the fund.
On behalf of the fund, FMR Far East has entered into a sub-advisory
agreement with FIJ pursuant to which FMR Far East may receive from FIJ
investment research and advice relating to Japanese issuers (and such
other Asian issuers as FMR Far East may designate).
For providing non-discretionary investment advice and research
services the sub-advisers are compensated as follows:
(small solid bullet) FMR pays FMR U.K. and FMR Far East fees equal to
110% and 105%, respectively, of FMR U.K.'s and FMR Far East's costs
incurred in connection with providing investment advice and research
services.
(small solid bullet) FMR Far East pays FIJ a fee equal to 100% of
FIJ's costs incurred in connection with providing investment advice
and research services for a fund to FMR Far East.
For providing discretionary investment management and executing
portfolio transactions, the sub-advisers are compensated as follows:
(small solid bullet) FMR pays FMR U.K. and FMR Far East a fee equal to
50% of its monthly management fee (including any performance
adjustment) with respect to the fund's average net assets managed by
the sub-adviser on a discretionary basis.
For providing investment advice and research services, fees paid to
FMR U.K. , FMR Far East, and FIJ for the past three
fiscal years are shown in the table below.
Fiscal Year Ended March 31 FMR U.K. FMR Far East FIJ
2000 $ 2,917,594 $ 1,663,035 $ 220,168
1999 $ 2,985,258 $ 2,440,699 $ 0
1998 $ 2,677,424 $ 2,616,248 $ 0
For discretionary investment management and execution of portfolio
transactions, no fees were paid to FMR U.K. and FMR Far East on behalf
of the fund for the past three fiscal years.
DISTRIBUTION SERVICES
The fund has entered into a distribution agreement with FDC, an
affiliate of FMR. FDC is a broker-dealer registered under the
Securities Exchange Act of 1934 and a member of the National
Association of Securities Dealers, Inc. The distribution agreement
calls for FDC to use all reasonable efforts, consistent with its other
business, to secure purchasers for shares of the fund, which are
continuously offered. Promotional and administrative expenses in
connection with the offer and sale of shares are paid by FMR.
During the fiscal years ended March 31, 2000, 1999, and 1998, FDC
collected sales charge revenue of $ 11,728,000 ,
$ 9,936,000 , and $ 10,307,000 , respectively, on purchases
of fund shares and, of these amounts, retained $ 11,712,000 ,
$ 9,916,000 , and $ 10,287,000 , respectively.
The Trustees have approved a Distribution and Service Plan on behalf
of the fund (the Plan) pursuant to Rule 12b-1 under the 1940 Act (the
Rule). The Rule provides in substance that a mutual fund may not
engage directly or indirectly in financing any activity that is
primarily intended to result in the sale of shares of the fund except
pursuant to a plan approved on behalf of the fund under the Rule. The
Plan, as approved by the Trustees, allows the fund and FMR to incur
certain expenses that might be considered to constitute indirect
payment by the fund of distribution expenses.
Under the Plan, if the payment of management fees by the fund to FMR
is deemed to be indirect financing by the fund of the distribution of
its shares, such payment is authorized by the Plan. The Plan
specifically recognizes that FMR may use its management fee revenue,
as well as its past profits or its other resources, to pay FDC for
expenses incurred in connection with providing services intended to
result in the sale of the fund shares and/or shareholder support
services. In addition, the Plan provides that FMR, directly or through
FDC, may pay significant amounts to intermediaries, such as
banks, broker-dealers and other service-providers, that provide those
services. Currently, the Board of Trustees has authorized such
payments for Magellan shares.
Prior to approving the Plan, the Trustees carefully considered all
pertinent factors relating to the implementation of the Plan, and
determined that there is a reasonable likelihood that the Plan will
benefit the fund and its shareholders. In particular, the Trustees
noted that the Plan does not authorize payments by the fund other than
those made to FMR under its management contract with the fund. To the
extent that the Plan gives FMR and FDC greater flexibility in
connection with the distribution of fund shares, additional sales of
fund shares or stabilization of cash flows may result. Furthermore,
certain shareholder support services may be provided more effectively
under the Plan by local entities with whom shareholders have other
relationships.
The Glass-Steagall Act generally prohibits federally and state
chartered or supervised banks from directly engaging in the business
of underwriting, selling or distributing securities. 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, 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 fund 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.
The fund may execute portfolio transactions with, and purchase
securities issued by, depository institutions that receive payments
under the Plan. No preference for the instruments of such depository
institutions will be shown in the selection of investments.
FDC may compensate intermediaries that satisfy certain criteria
established from time to time by FDC relating to the level or type of
services provided by the intermediary, the sale or expected sale of
significant amounts of shares, or other factors.
TRANSFER AND SERVICE AGENT AGREEMENTS
The fund has entered into a transfer agent agreement with FSC, an
affiliate of FMR. Under the terms of the agreement, FSC performs
transfer agency, dividend disbursing, and shareholder services for the
fund.
For providing transfer agency services, FSC receives an account fee
and an asset-based fee each paid monthly with respect to each account
in the fund. For retail accounts and certain institutional accounts,
these fees are based on account size and fund type. For certain
institutional retirement accounts, these fees are based on fund type.
For certain other institutional retirement accounts, these fees are
based on account type and fund type. The account fees are subject to
increase based on postage rate changes.
The asset-based fees are subject to adjustment if the year-to-date
total return of the S&P 500 exceeds a positive or negative 15%.
FSC also collects small account fees from certain accounts with
balances of less than $2,500.
In addition, FSC receives the pro rata portion of the transfer agency
fees applicable to shareholder accounts in a qualified state tuition
program (QSTP), as defined under the Small Business Job Protection Act
of 1996, managed by FMR or an affiliate and in each Fidelity Freedom
Fund and Fidelity Four-in-One Index Fund, funds of funds managed by an
FMR affiliate, according to the percentage of the QSTP's, Freedom
Fund's or Fidelity Four-in-One Index Fund's assets that is invested in
the fund, subject to certain limitations in the case of Fidelity
Four-in-One Index Fund.
FSC pays out-of-pocket expenses associated with providing transfer
agent services. In addition, FSC bears the expense of typesetting,
printing, and mailing prospectuses, statements of additional
information, and all other reports, notices, and statements to
existing shareholders, with the exception of proxy statements.
The fund has also entered into a service agent agreement with FSC.
Under the terms of the agreement, FSC calculates the NAV and dividends
for the fund, maintains the fund's portfolio and general accounting
records, and administers the fund's securities lending program.
For providing pricing and bookkeeping services, FSC receives a monthly
fee based on the fund's average daily net assets throughout the month.
The annual rates for pricing and bookkeeping services for the fund are
0.0365% of the first $500 million of average net assets, 0.0155% of
average net assets between $500 million and $3 billion, 0.0040% of
average net assets between $3 billion and $25 billion, and 0.00075% of
average net assets in excess of $25 billion. The fee, not including
reimbursement for out-of-pocket expenses, is limited to a minimum of
$60,000 per year.
For the fiscal years ended March 31, 2000, 1999, and 1998, the fund
paid FSC pricing and bookkeeping fees, including reimbursement for
related out-of-pocket expenses, of $2,032,000, $ 1,194,000 , and
$ 934,000 , respectively.
For administering the fund's securities lending program, FSC is paid
based on the number and duration of individual securities loans.
For the fiscal years ended March 31, 2000, 1999, and 1998, the fund
paid FSC $36,000, $0, and $ 0 , respectively, for securities
lending.
DESCRIPTION OF THE FUND
TRUST ORGANIZATION. Fidelity Magellan Fund is a fund of Fidelity
Magellan Fund, an open-end management investment company organized as
a Massachusetts business trust on October 1, 1984. Currently, there is
one fund in the trust: Fidelity Magellan Fund. The Trustees are
permitted to create additional funds in the trust and to create
additional classes of the 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 to the rights of creditors, are allocated to such fund, and
constitute the underlying assets of such fund. The underlying assets
of each fund in the trust shall be charged with the liabilities and
expenses attributable to such fund. Any general expenses of the trust
shall be allocated between or among any one or more of the funds.
SHAREHOLDER LIABILITY. The fund is an entity commonly known as a
"Massachusetts business trust." Under Massachusetts law, shareholders
of such a trust may, under certain circumstances, be held personally
liable for the obligations of the trust.
The Declaration of Trust contains an express disclaimer of shareholder
liability for the debts, liabilities, obligations, and expenses of the
fund. The Declaration of Trust provides that the fund shall not have
any claim against shareholders except for the payment of the purchase
price of shares and requires that each agreement, obligation, or
instrument entered into or executed by the fund or the Trustees
relating to the fund shall include a provision limiting the
obligations created thereby to the fund and its assets.
The Declaration of Trust provides for indemnification out of the
fund's property of any shareholder or former shareholder held
personally liable for the obligations of the fund solely by reason of
his or her being or having been a shareholder and not because of his
or her acts or omissions or for some other reason. The Declaration of
Trust also provides that the 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 the fund
itself would be unable to meet its obligations. FMR believes that, in
view of the above, the risk of personal liability to shareholders is
remote.
VOTING RIGHTS. The fund's capital consists of shares of beneficial
interest. As a shareholder, you are entitled to one vote for each
dollar of net asset value you own. The voting rights of shareholders
can be changed only by a shareholder vote. Shares may be voted in the
aggregate and by class.
The shares have no preemptive rights or conversion rights. Shares are
fully paid and nonassessable, except as set forth under the heading
"Shareholder Liability" above.
The fund or a class may be terminated upon the sale of its assets to,
or merger with, another open-end management investment company,
series, or class thereof, or upon liquidation and distribution of its
assets. Generally, the merger of the fund or a class with another
operating mutual fund or the sale of all or a portion of the assets of
the fund or a class to another operating mutual fund requires approval
by a vote of shareholders of the fund or the class. The Trustees may,
however, reorganize or terminate the fund or a class without prior
shareholder approval. In the event of the dissolution or liquidation
of the fund or a class, shareholders of that fund or that class are
entitled to receive the underlying assets of the fund or class
available for distribution.
CUSTODIAN S . State Street Bank and Trust Company, 1776 Heritage
Drive, Quincy, Massachusetts, is custodian of the assets of the fund.
The custodian is responsible for the safekeeping of the fund's
assets and the appointment of any subcustodian banks and clearing
agencies. The Bank of New York and The Chase Manhattan Bank, each
headquartered in New York, also may serve as special purpose
custodians of certain assets in connection with repurchase agreement
transactions.
FMR, its officers and directors, its affiliated companies, and members
of the Board of Trustees may, from time to time, conduct transactions
with various banks, including banks serving as custodians for certain
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. P ricewaterhouseCoopers LLP, 160 Federal Street, Boston,
Massachusetts, serv es as independent accountant for the fund. The
auditor examines financial statements for the fund and provides other
audit, tax, and related services.
FINANCIAL STATEMENTS
The fund's financial statements and financial highlights for the
fiscal year ended March 31, 2000, and report of the auditor, are
included in the fund's annual report and are incorporated herein by
reference.
APPENDIX
Fidelity, Magellan, Fidelity Investments & (Pyramid) Design,
Fidelity Focus, Spartan, and Fidelity Investments are registered
trademarks of FMR Corp.
Portfolio Advisory Services and The CORPORATEplan for Retirement
are service mark s of FMR Corp.
The third party marks appearing above are the marks of their
respective owners.
PART C. OTHER INFORMATION
Item 23. Exhibits
(a) Amended and Restated Declaration of Trust, dated April 19, 2000,
is filed herein as Exhibit a(1).
(b) Bylaws of the Trust, as amended and dated May 19, 1994, are
incorporated herein by reference to Exhibit 2(a) of Fidelity Union
Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
(c) Not applicable.
(d) (1) Management Contract between Fidelity Magellan Fund and
Fidelity Management & Research Company, dated May 1, 2000, is filed
herein as Exhibit d(1).
(2) Sub-Advisory Agreement between Fidelity Management & Research
(Far East) Inc. and Fidelity Management & Research Company, dated May
1, 2000, is filed herein as Exhibit d(2).
(3) Sub-Advisory Agreement between Fidelity Management & Research
(U.K.) Inc. and Fidelity Management & Research Company, dated May 1,
2000, is filed herein as Exhibit d(3).
(4) Form of Sub-Advisory Agreement between FMR Co., Inc. and
Fidelity Management & Research Company is incorporated herein by
reference to Exhibit d(4) of Post-Effective Amendment No. 47.
(5) Research Agreement between Fidelity Management & Research (Far
East) Inc. and Fidelity Investments Japan Limited is incorporated
herein by reference to Exhibit d(5) of Post-Effective Amendment No.
47.
(e) (1) General Distribution Agreement between Fidelity Magellan Fund
and Fidelity Distributors Corporation as amended in its entirety,
dated April 1, 1987, is incorporated herein by reference to Exhibit
6(a) of Post-Effective Amendment No. 41.
(2) Amendment to General Distribution Agreement between Fidelity
Magellan Fund and Fidelity Distributors Corporation, dated January 1,
1988, is incorporated herein by reference to Exhibit 6(b) of
Post-Effective Amendment No. 41.
(3) Amendments to the General Distribution Agreement between the
Registrant and Fidelity Distributors Corporation, dated March 14, 1996
and July 15, 1996, are incorporated herein by reference to Exhibit
6(k) of Fidelity Select Portfolios' Post-Effective Amendment No. 57
(File No. 2-69972).
(4) Form of Bank Agency Agreement (most recently revised January
1997) is incorporated herein by reference to Exhibit 6(a) of
Post-Effective Amendment No. 43.
(5) Form of Selling Dealer Agreement for Bank-Related Transactions
(most recently revised January, 1997) is incorporated herein by
reference to Exhibit 6(b) of Post-Effective Amendment No. 43.
(f) (1) The Fee Deferral Plan for Non-Interested Person Directors and
Trustees of the Fidelity Funds, effective as of September 15, 1995 and
amended through January 1, 2000, is incorporated herein by reference
to Exhibit (f)(1) of Fidelity Massachusetts Municipal Trust's (File
No. 2-75537) Post-Effective Amendment No. 39.
(g) (1) Custodian Agreement, and Appendix C, dated February 1, 1996,
between State Street Bank and Trust Company and the Registrant are
incorporated herein by reference to Exhibit 8(b) of Fidelity
Institutional Trust's (File No. 33-15983) Post-Effective Amendment No.
22.
(2) Appendix A, dated November 19, 1998, to the Custodian Agreement,
dated February 1, 1996, between State Street Bank and Trust Company
and the Registrant is incorporated herein by reference to Exhibit g(2)
of Fidelity Advisor Series VIII's (File No. 2-86711) Post-Effective
Amendment No. 53.
(3) Appendix B, dated December 16, 1999, to the Custodian Agreement,
dated February 1, 1996, between State Street Bank and Trust Company
and the Registrant is filed herein as Exhibit g(3).
(4) Addendum, dated October 21, 1996, to the Custodian Agreement,
dated February 1, 1996, between State Street Bank and Trust Company
and the Registrant is incorporated herein by reference to Exhibit
(g)(4) of Fidelity Advisor Series VIII's (File No. 2-86711)
Post-Effective Amendment No. 54.
(5) Fidelity Group Repo Custodian Agreement among The Bank of New
York, J. P. Morgan Securities, Inc. and the Registrant, dated February
12, 1996, is incorporated herein by reference to Exhibit 8(d) of
Fidelity Institutional Cash Portfolios' (File No. 2-74808)
Post-Effective Amendment No. 31.
(6) Schedule 1 to the Fidelity Group Repo Custodian Agreement
between The Bank of New York and the Registrant, dated February 12,
1996, is incorporated herein by reference to Exhibit 8(e) of Fidelity
Institutional Cash Portfolios' (File No. 2-74808) Post-Effective
Amendment No. 31.
(7) Fidelity Group Repo Custodian Agreement among Chemical Bank,
Greenwich Capital Markets, Inc., and the Registrant, dated November
13, 1995, is incorporated herein by reference to Exhibit 8(f) of
Fidelity Institutional Cash Portfolios' (File No. 2-74808)
Post-Effective Amendment No. 31.
(8) Schedule 1 to the Fidelity Group Repo Custodian Agreement
between Chemical Bank and the Registrant, dated November 13, 1995, is
incorporated herein by reference to Exhibit 8(g) of Fidelity
Institutional Cash Portfolios' (File No. 2-74808) Post-Effective
Amendment No. 31.
(9) Joint Trading Account Custody Agreement between The Bank of New
York and the Registrant, dated May 11, 1995, is incorporated herein by
reference to Exhibit 8(h) of Fidelity Institutional Cash Portfolios'
(File No. 2-74808) Post-Effective Amendment No. 31.
(10) First Amendment to Joint Trading Account Custody Agreement
between The Bank of New York and the Registrant, dated July 14, 1995,
is incorporated herein by reference to Exhibit 8(i) of Fidelity
Institutional Cash Portfolios' (File No. 2-74808) Post-Effective
Amendment No. 31.
(11) Schedule A-1, dated March 29, 2000, to the Fidelity Group Repo
Custodian Agreements, Schedule 1s to the Fidelity Group Repo Custodian
Agreements, Joint Trading Account Custody Agreement, and First
Amendment to the Joint Trading Account Custody Agreement, between the
respective parties and the Registrant, is filed herein as Exhibit
g(11).
(h) Not applicable.
(i) Legal Opinion of Kirkpatrick & Lockhart LLP for Fidelity Magellan
Fund, dated May 16, 2000, is filed herein as Exhibit i(1).
(j) Consent of PricewaterhouseCoopers LLP, dated May 16, 2000, is
filed herein as Exhibit j(1).
(k) Not applicable.
(l) Not applicable.
(m) Distribution and Service Plan pursuant to Rule 12b-1 for Fidelity
Magellan Fund is filed herein as Exhibit m(1).
(n) Not applicable.
(o) Not applicable.
(p)(1) Code of Ethics, dated January 1, 2000, adopted by the fund,
Fidelity Management & Research Company, FMR Co., Inc., Fidelity
Management & Research (U.K.) Inc., Fidelity Management & Research (Far
East) Inc., Fidelity Investments Japan Limited, and Fidelity
Distributors Corporation pursuant to Rule 17j-1 is incorporated herein
by reference to Exhibit (p)(1) of Fidelity Commonwealth Trust's (File
No. 2-52322) Post-Effective Amendment No. 69.
Item 24. Trusts Controlled by or under Common Control with this Trust
The Board of Trustees of the Trust is the same as the board of other
Fidelity funds, each of which has Fidelity Management & Research
Company, or an affiliate, as its investment adviser. In addition, the
officers of the Trust are substantially identical to those of the
other Fidelity funds. Nonetheless, the Trust takes the position that
it is not under common control with other Fidelity funds because the
power residing in the respective boards and officers arises as the
result of an official position with the respective trusts.
Item 25. Indemnification
Article XI, Section 2 of the Declaration of Trust sets forth the
reasonable and fair means for determining whether indemnification
shall be provided to any past or present Trustee or officer. It states
that the Trust shall indemnify any present or past trustee or officer
to the fullest extent permitted by law against liability, and all
expenses reasonably incurred by him or her in connection with any
claim, action, suit or proceeding in which he or she is involved by
virtue of his or her service as a trustee or officer and against any
amount incurred in settlement thereof. Indemnification will not be
provided to a person adjudged by a court or other adjudicatory body to
be liable to the Trust or its shareholders by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of his
or her duties (collectively, "disabling conduct"), or not to have
acted in good faith in the reasonable belief that his or her action
was in the best interest of the Trust. In the event of a settlement,
no indemnification may be provided unless there has been a
determination, as specified in the Declaration of Trust, that the
officer or trustee did not engage in disabling conduct.
Pursuant to Section 11 of the Distribution Agreement, the Trust
agrees to indemnify and hold harmless the Distributor and each of its
directors and officers and each person, if any, who controls the
Distributor within the meaning of Section 15 of the 1933 Act against
any loss, liability, claim, damages or expense (including the
reasonable cost of investigating or defending any alleged loss,
liability, claim, damages, or expense and reasonable counsel fees
incurred in connection therewith) arising by reason of any person
acquiring any shares, based upon the ground that the registration
statement, Prospectus, Statement of Additional Information,
shareholder reports or other information filed or made public by the
Trust (as from time to time amended) included an untrue statement of a
material fact or omitted to state a material fact required to be
stated or necessary in order to make the statements not misleading
under the 1933 Act, or any other statute or the common law. However,
the Trust does not agree to indemnify the Distributor or hold it
harmless to the extent that the statement or omission was made in
reliance upon, and in conformity with, information furnished to the
Trust by or on behalf of the Distributor. In no case is the indemnity
of the Trust in favor of the Distributor or any person indemnified to
be deemed to protect the Distributor or any person against any
liability to the Issuer or its security holders to which the
Distributor or such person would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance
of its duties or by reason of its reckless disregard of its
obligations and duties under this Agreement.
Pursuant to the agreement by which Fidelity Service Company, Inc.
("FSC") is appointed transfer agent, the Trust agrees to indemnify and
hold FSC harmless against any losses, claims, damages, liabilities or
expenses (including reasonable counsel fees and expenses) resulting
from:
(1) any claim, demand, action or suit brought by any person other
than the Trust, including by a shareholder, which names FSC and/or the
Trust as a party and is not based on and does not result from FSC's
willful misfeasance, bad faith or negligence or reckless disregard of
duties, and arises out of or in connection with FSC's performance
under the Transfer Agency Agreement; or
(2) any claim, demand, action or suit (except to the extent
contributed to by FSC's willful misfeasance, bad faith or negligence
or reckless disregard of its duties) which results from the negligence
of the Trust, or from FSC's acting upon any instruction(s) reasonably
believed by it to have been executed or communicated by any person
duly authorized by the Trust, or as a result of FSC's acting in
reliance upon advice reasonably believed by FSC to have been given by
counsel for the Trust, or as a result of FSC's acting in reliance upon
any instrument or stock certificate reasonably believed by it to have
been genuine and signed, countersigned or executed by the proper
person.
Item 26. Business and Other Connections of Investment Advisers
(1) FIDELITY MANAGEMENT & RESEARCH COMPANY (FMR)
82 Devonshire Street, Boston, MA 02109
FMR serves as investment adviser to a number of other investment
companies. The directors and officers of the Adviser have held,
during the past two fiscal years, the following positions of a
substantial nature.
Edward C. Johnson 3d Chairman of the Board and
Director of FMR; Chief
Executive Officer, Chairman
of the Board, and Director
of FMR Corp., Fidelity
Investments Money
Management, Inc. (FIMM),
Fidelity Management &
Research (U.K.) Inc. (FMR
U.K.), Fidelity Management &
Research (Far East) Inc.
(FMR Far East), and Fidelity
Management & Research Co.,
Inc. (FMRC); Chairman of the
Executive Committee of FMR;
Chairman and Representative
Director of Fidelity
Investments Japan Limited
(FIJ); President and Trustee
of funds advised by FMR.
Robert C. Pozen President and Director of
FMR; Senior Vice President
and Trustee of funds advised
by FMR; President and
Director of FIMM, FMRC, FMR
U.K., and FMR Far East;
Director of Strategic
Advisers, Inc.; Previously,
General Counsel, Managing
Director, and Senior Vice
President of FMR Corp.
Peter S. Lynch Vice Chairman of the Board
and Director of FMR and FMRC.
John Avery Vice President of FMR and of
funds advised by FMR.
Robert Bertelson Vice President of FMR and of
a fund advised by FMR.
John H. Carlson Vice President of FMR and of
funds advised by FMR.
Robert C. Chow Vice President of FMR and of
a fund advised by FMR.
Dwight D. Churchill Senior Vice President of FMR
and Vice President of Bond
Funds advised by FMR; Vice
President of FIMM.
Laura B. Cronin Vice President of FMR and
Treasurer of FMR, FIMM, FMR
U.K., FMRC and FMR Far East.
Barry Coffman Vice President of FMR and of
a fund advised by FMR.
Arieh Coll Vice President of FMR.
Catherine Collins Vice President of FMR.
Frederic G. Corneel Tax Counsel of FMR.
William Danoff Senior Vice President of FMR
and Vice President of funds
advised by FMR.
Scott E. DeSano Vice President of FMR.
Penelope Dobkin Vice President of FMR and of
a fund advised by FMR.
Walter C. Donovan Vice President of FMR.
Bettina Doulton Senior Vice President of FMR
and of funds advised by FMR.
Stephen DuFour Vice President of FMR and of
a fund advised by FMR.
Maria F. Dwyer Vice President of FMR and
Deputy Treasurer of the
Fidelity funds.
Margaret L. Eagle Vice President of FMR and of
a fund advised by FMR.
William R. Ebsworth Vice President of FMR.
David Felman Vice President of FMR and of
a fund advised by FMR.
Richard B. Fentin Senior Vice President of FMR
and Vice President of a fund
advised by FMR.
Karen Firestone Vice President of FMR and of
a fund advised by FMR.
Michael B. Fox Assistant Treasurer of FMR,
FIMM, FMR U.K., and FMR Far
East; Vice President and
Treasurer of FMR Corp. and
Strategic Advisers, Inc.;
Vice President of FMR U.K.,
FMR Far East, and FIMM.
Gregory Fraser Vice President of FMR and of
funds advised by FMR.
Jay Freedman Assistant Clerk of FMR; Clerk
of FMR Corp., FMR U.K., FMR
Far East, FMRC, and
Strategic Advisers, Inc.;
Secretary of FIMM; Vice
President and Deputy General
Counsel of FMR Corp.
David L. Glancy Vice President of FMR and of
funds advised by FMR.
Barry A. Greenfield Vice President of FMR and of
funds advised by FMR.
Boyce I. Greer Senior Vice President of FMR
and Vice President of Money
Market Funds advised by FMR;
Vice President of FIMM.
Bart A. Grenier Senior Vice President of FMR
and Vice President of
High-Income Funds advised by
FMR.
Robert J. Haber Vice President of FMR.
Richard C. Habermann Senior Vice President of FMR
and Vice President of funds
advised by FMR.
Fred L. Henning Jr. Senior Vice President of FMR;
Senior Vice President of
FIMM; Vice President of
Fixed-Income Funds advised
by FMR.
Bruce T. Herring Vice President of FMR.
Robert F. Hill Vice President of FMR and
Director of Technical
Research.
Frederick Hoff Vice President of FMR.
Abigail P. Johnson Senior Vice President of FMR
and Vice President of funds
advised by FMR; Director of
FMR Corp.; Associate
Director and Senior Vice
President of Equity Funds
advised by FMR.
David B. Jones Vice President of FMR.
Steven Kaye Senior Vice President of FMR
and of a fund advised by FMR.
Francis V. Knox Vice President of FMR;
Compliance Officer of FMR
U.K. and FMR Far East.
Harris Leviton Vice President of FMR and of
a fund advised by FMR.
Bradford E. Lewis Vice President of FMR and of
funds advised by FMR.
Richard R. Mace Jr. Vice President of FMR and of
funds advised by FMR.
Shigeki Makino Vice President of FMR.
Charles A. Mangum Vice President of FMR and of
funds advised by FMR.
Kevin McCarey Vice President of FMR and of
funds advised by FMR.
James McDowell Senior Vice President of FMR.
Neal P. Miller Vice President of FMR and of
a fund advised by FMR.
Jacques Perold Vice President of FMR.
Stephen Petersen Senior Vice President of FMR
and Vice President of funds
advised by FMR.
Alan Radlo Vice President of FMR.
Eric D. Roiter Vice President, General
Counsel, and Clerk of FMR
and Secretary of funds
advised by FMR.
Lee H. Sandwen Vice President of FMR.
Patricia A. Satterthwaite Vice President of FMR and of
funds advised by FMR.
Fergus Shiel Vice President of FMR and of
funds advised by FMR.
Richard A. Silver Vice President of FMR.
Carol A. Smith-Fachetti Vice President of FMR.
Steven J. Snider Vice President of FMR and of
funds advised by FMR.
Thomas T. Soviero Vice President of FMR and of
a fund advised by FMR.
Richard Spillane Senior Vice President of FMR;
Associate Director and
Senior Vice President of
Equity Funds advised by FMR;
Previously, Senior Vice
President and Director of
Operations and Compliance of
FMR U.K.
Thomas M. Sprague Vice President of FMR and of
a fund advised by FMR.
Robert E. Stansky Senior Vice President of FMR
and Vice President of a fund
advised by FMR.
Scott D. Stewart Vice President of FMR and of
funds advised by FMR.
Beth F. Terrana Senior Vice President of FMR
and Vice President of funds
advised by FMR.
Yoko Tilley Vice President of FMR.
Joel C. Tillinghast Vice President of FMR and of
a fund advised by FMR.
Robert Tuckett Vice President of FMR.
Jennifer Uhrig Vice President of FMR and of
funds advised by FMR.
George A. Vanderheiden Senior Vice President of FMR
and Director of FMR Corp.
Jason Weiner Vice President of FMR and of
a fund advised by FMR.
Steven S. Wymer Vice President of FMR and of
a fund advised by FMR.
(2) FMR CO., INC. (FMRC)
82 Devonshire Street, Boston, MA 02109
FMRC provides investment advisory services to Fidelity Management &
Research Company. The directors and officers of the Sub-Adviser have
held the following positions of a substantial nature during the past
two fiscal years.
Edward C. Johnson 3d Chairman of the Board and
Director of FMRC, FMR U.K.,
FMR, FMR Corp., FIMM, and
FMR Far East; President and
Chief Executive Officer of
FMR Corp.; Chairman of the
Executive Committee of FMR;
Chairman and Representative
Director of Fidelity
Investments Japan Limited
(FIJ); President and Trustee
of funds advised by FMR.
Robert C. Pozen Senior Vice President and
Trustee of funds advised by
FMR; President and Director
of FMRC, FIMM, FMR, FMR
U.K., and FMR Far East;
Director of Strategic
Advisers, Inc.; Previously,
General Counsel, Managing
Director, and Senior Vice
President of FMR Corp.
Peter S. Lynch Vice Chairman of the Board
and Director of FMR and FMRC.
Brian Clancy Vice President.
Laura B. Cronin Treasurer of FMRC, FMR U.K.,
FMR Far East, FMR, and FIMM
and Vice President of FMR.
Jay Freedman Assistant Clerk of FMR; Clerk
of FMR Corp., FMR U.K., FMR
Far East, FMRC, and
Strategic Advisers, Inc.;
Secretary of FIMM; Vice
President and Deputy General
Counsel of FMR Corp.
(3) FIDELITY MANAGEMENT & RESEARCH (U.K.) INC. (FMR U.K.)
25 Lovat Lane, London, EC3R 8LL, England
FMR U.K. provides investment advisory services to Fidelity Management
& Research Company and Fidelity Management Trust Company. The
directors and officers of the Sub-Adviser have held the following
positions of a substantial nature during the past two fiscal years.
Edward C. Johnson 3d Chairman of the Board and
Director of FMR U.K., FMRC,
FMR, FMR Corp., FIMM, and
FMR Far East; President and
Chief Executive Officer of
FMR Corp.; Chairman of the
Executive Committee of FMR;
Chairman and Representative
Director of Fidelity
Investments Japan Limited
(FIJ); President and Trustee
of funds advised by FMR.
Robert C. Pozen President and Director of FMR
U.K.; Senior Vice President
and Trustee of funds advised
by FMR; President and
Director of FIMM, FMR, FMRC,
and FMR Far East; Director
of Strategic Advisers, Inc.;
Previously, General Counsel,
Managing Director, and
Senior Vice President of FMR
Corp.
Laura B. Cronin Treasurer of FMR U.K., FMR
Far East, FMR, and FIMM and
Vice President of FMR.
Michael B. Fox Assistant Treasurer of FMR
U.K., FMR, FMR Far East,
FMRC, and FIMM; Vice
President of FMR U.K., FMR
Far East, and FIMM; Vice
President and Treasurer of
FMR Corp. and Strategic
Advisers, Inc.
Simon Fraser Senior Vice President of FMR
U.K. and Director and
President of FIIA.
Jay Freedman Clerk of FMR U.K., FMR Far
East, FMR Corp., FMRC, and
Strategic Advisers, Inc.;
Assistant Clerk of FMR;
Secretary of FIMM; Vice
President and Deputy General
Counsel of FMR Corp.
Susan Englander Hislop Assistant Clerk of FMR U.K.,
FMR Far East, and Strategic
Advisers, Inc.; Assistant
Secretary of FIMM.
Francis V. Knox Compliance Officer of FMR
U.K. and FMR Far East; Vice
President of FMR.
(4) FIDELITY MANAGEMENT & RESEARCH (Far East) INC. (FMR Far East)
Shiroyama JT Mori Bldg., 4-3-1 Toranomon Minato-ku, Tokyo 105,
Japan
FMR Far East provides investment advisory services to Fidelity
Management & Research Company and Fidelity Management Trust Company.
The directors and officers of the Sub-Adviser have held the following
positions of a substantial nature during the past two fiscal years.
Edward C. Johnson 3d Chairman of the Board and
Director of FMR Far East,
FMR, FMR Corp., FMRC, FIMM,
and FMR U.K.; Chairman of
the Executive Committee of
FMR; President and Chief
Executive Officer of FMR
Corp.; Chairman and
Representative Director of
Fidelity Investments Japan
Limited (FIJ); President and
Trustee of funds advised by
FMR.
Robert C. Pozen President and Director of FMR
Far East; Senior Vice
President and Trustee of
funds advised by FMR;
President and Director of
FIMM, FMR U.K., FMRC, and
FMR; Director of Strategic
Advisers, Inc.; Previously,
General Counsel, Managing
Director, and Senior Vice
President of FMR Corp.
Robert H. Auld Senior Vice President of FMR
Far East.
Laura B. Cronin Treasurer of FMR Far East,
FMR U.K., FMR, FMRC, and
FIMM and Vice President of
FMR.
Michael B. Fox Assistant Treasurer of FMR
Far East, FMR, FMR U.K., and
FIMM; Vice President of FMR
Far East and FMR U.K.; Vice
President and Treasurer of
FMR Corp. and Strategic
Advisers, Inc.
Francis V. Knox Compliance Officer of FMR Far
East and FMR U.K.; Vice
President of FMR.
Jay Freedman Clerk of FMR Far East, FMR
U.K., FMR Corp., FMRC, and
Strategic Advisers, Inc.;
Assistant Clerk of FMR;
Secretary of FIMM; Vice
President and Deputy General
Counsel of FMR Corp.
Susan Englander Hislop Assistant Clerk of FMR Far
East, FMR U.K., and
Strategic Advisers, Inc.;
Assistant Secretary of FIMM.
Billy Wilder Vice President of FMR Far
East; President and
Representative Director of
FIJ.
(5) FIDELITY INVESTMENTS JAPAN LIMITED (FIJ)
Shiroyama JT Mori Bldg., 4-3-1 Toranomon Minato-ku, Tokyo 105,
Japan
The directors and officers of FIJ have held, during the past two
fiscal years, the following positions of a substantial nature.
Edward C. Johnson 3d Chairman and Representative
Director of FIJ; Chairman of
the Board and Director of
FMR Far East, FMR, FMR
Corp., FMR U.K., FMRC, and
FIMM; Chairman of the
Executive Committee of FMR;
President and Chief
Executive Officer of FMR
Corp.; President and Trustee
of funds advised by FMR.
Yasuo Kuramoto Vice Chairman and
Representative Director of
FIJ.
Billy Wilder President and Representative
Director of FIJ; Vice
President of FMR Far East.
Noboru Kawai Director and General Manager
of Administration of FIJ.
Tetsuzo Nishimura Director and Vice President
of Wholesales/ Broker
Distribution of FIJ.
Hiroshi Yamashita Senior Managing Director of
FIJ.
Yasushi Murofushi Statutory Auditor of FIJ.
Takeshi Okazaki Director and Head of
Institutional Sales of FIJ.
Simon Haslam Director of FIJ; Director and
Chief Financial Officer of
FIIA, FISL (U.K.), and FII;
Director and Secretary of
FIIA(U.K.)L; Previously,
Chief Financial Officer of
FIL; Company Secretary of
Fidelity Investments Group
of Companies (U.K.).
Item 27. Principal Underwriters
(a) Fidelity Distributors Corporation (FDC) acts as distributor for
all funds advised by FMR or an affiliate.
(b)
Name and Principal Positions and Offices Positions and Offices
Business Address* with Underwriter with Fund
Edward L. McCartney Director and President None
J. Gary Burkhead Director None
Paul J. Gallagher Director None
Kevin J. Kelly Director None
Daniel T. Geraci Executive Vice President None
Eric D. Roiter Vice President and Clerk Secretary
Jane Greene Treasurer and Controller None
Gary Greenstein Assistant Treasurer None
Jay Freedman Assistant Clerk None
Linda Capps Holland Compliance Officer None
* 82 Devonshire Street, Boston, MA
(c) Not applicable.
Item 28. Location of Accounts and Records
All accounts, books, and other documents required to be maintained by
Section 31(a) of the 1940 Act and the Rules promulgated thereunder are
maintained by Fidelity Management & Research Company, Fidelity Service
Company, Inc. or Fidelity Investments Institutional Operations
Company, Inc., 82 Devonshire Street, Boston, MA 02109, or the fund's
custodian, State Street Bank & Trust Company, 1776 Heritage Drive,
Quincy, MA.
Item 29. Management Services
Not applicable.
Item 30. Undertakings
Not applicable.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets
all of the requirements for the effectiveness of this Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and
has duly caused this Post-Effective Amendment No. 48 to the
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Boston, and Commonwealth of
Massachusetts, on the 16th day of May 2000.
Fidelity Magellan Fund
By /s/Edward C. Johnson 3d (dagger)
Edward C. Johnson 3d, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons
in the capacities and on the dates indicated.
(Signature) (Title) (Date)
/s/Edward C. Johnson 3d(dagger) President and Trustee May 16, 2000
Edward C. Johnson 3d (Principal Executive Officer)
/s/Robert A. Dwight Treasurer May 16, 2000
Robert A. Dwight
/s/Robert C. Pozen Trustee May 16, 2000
Robert C. Pozen
/s/Ralph F. Cox* Trustee May 16, 2000
Ralph F. Cox
/s/Phyllis Burke Davis* Trustee May 16, 2000
Phyllis Burke Davis
/s/Robert M. Gates* Trustee May 16, 2000
Robert M. Gates
/s/Donald J. Kirk* Trustee May 16, 2000
Donald J. Kirk
/s/Ned C. Lautenbach* Trustee May 16, 2000
Ned C. Lautenbach
/s/Peter S. Lynch* Trustee May 16, 2000
Peter S. Lynch
/s/Marvin L. Mann* Trustee May 16, 2000
Marvin L. Mann
/s/William O. McCoy* Trustee May 16, 2000
William O. McCoy
/s/Gerald C. McDonough* Trustee May 16, 2000
Gerald C. McDonough
/s/Thomas R. Williams* Trustee May 16, 2000
Thomas R. Williams
(dagger) Signatures affixed by Robert C. Pozen pursuant to a power of
attorney dated July 17, 1997 and filed herewith.
* Signature affixed by Robert C. Hacker pursuant to a power of
attorney dated December 16, 1999 and filed herewith.
POWER OF ATTORNEY
I, the undersigned President and Director, Trustee, or General
Partner, as the case may be, of the following investment companies:
Fidelity Aberdeen Street Trust Fidelity Hereford Street Trust
Fidelity Advisor Series I Fidelity Income Fund
Fidelity Advisor Series II Fidelity Institutional Cash
Fidelity Advisor Series III Portfolios
Fidelity Advisor Series IV Fidelity Institutional
Fidelity Advisor Series V Tax-Exempt Cash Portfolios
Fidelity Advisor Series VI Fidelity Investment Trust
Fidelity Advisor Series VII Fidelity Magellan Fund
Fidelity Advisor Series VIII Fidelity Massachusetts
Fidelity Beacon Street Trust Municipal Trust
Fidelity Boston Street Trust Fidelity Money Market Trust
Fidelity California Municipal Fidelity Mt. Vernon Street
Trust Trust
Fidelity California Municipal Fidelity Municipal Trust
Trust II Fidelity Municipal Trust II
Fidelity Capital Trust Fidelity New York Municipal
Fidelity Charles Street Trust Trust
Fidelity Commonwealth Trust Fidelity New York Municipal
Fidelity Concord Street Trust Trust II
Fidelity Congress Street Fund Fidelity Phillips Street Trust
Fidelity Contrafund Fidelity Puritan Trust
Fidelity Corporate Trust Fidelity Revere Street Trust
Fidelity Court Street Trust Fidelity School Street Trust
Fidelity Court Street Trust II Fidelity Securities Fund
Fidelity Covington Trust Fidelity Select Portfolios
Fidelity Daily Money Fund Fidelity Sterling Performance
Fidelity Destiny Portfolios Portfolio, L.P.
Fidelity Deutsche Mark Fidelity Summer Street Trust
Performance Fidelity Trend Fund
Portfolio, L.P. Fidelity U.S.
Fidelity Devonshire Trust Investments-Bond Fund, L.P.
Fidelity Exchange Fund Fidelity U.S.
Fidelity Financial Trust Investments-Government
Fidelity Fixed-Income Trust Securities
Fidelity Government Fund, L.P.
Securities Fund Fidelity Union Street Trust
Fidelity Hastings Street Trust Fidelity Union Street Trust II
Fidelity Yen Performance
Portfolio, L.P.
Newbury Street Trust
Variable Insurance Products
Fund
Variable Insurance Products
Fund II
Variable Insurance Products
Fund III
in addition to any other investment company for which Fidelity
Management & Research Company or an affiliate acts as investment
adviser and for which the undersigned individual serves as President
and Director, Trustee, or General Partner (collectively, the "Funds"),
hereby constitute and appoint Robert C. Pozen my true and lawful
attorney-in-fact, with full power of substitution, and with full power
to him to sign for me and in my name in the appropriate capacity, all
Registration Statements of the Funds on Form N-1A, Form N-8A, or any
successor thereto, any and all subsequent Amendments, Pre-Effective
Amendments, or Post-Effective Amendments to said Registration
Statements on Form N-1A, Form N-8A, or any successor thereto, any
Registration Statements on Form N-14, and any supplements or other
instruments in connection therewith, and generally to do all such
things in my name and on my behalf in connection therewith as said
attorney-in-fact deems necessary or appropriate, to comply with the
provisions of the Securities Act of 1933 and the Investment Company
Act of 1940, and all related requirements of the Securities and
Exchange Commission. I hereby ratify and confirm all that said
attorney-in-fact or his substitutes may do or cause to be done by
virtue hereof. This power of attorney is effective for all documents
filed on or after August 1, 1997.
WITNESS my hand on the date set forth below.
/s/Edward C. Johnson 3d July 17, 1997
Edward C. Johnson 3d
POWER OF ATTORNEY
We, the undersigned Directors, Trustees, or General Partners, as the
case may be, of the following investment companies:
Colchester Street Trust Fidelity Hastings Street Trust
Fidelity Aberdeen Street Trust Fidelity Hereford Street Trust
Fidelity Advisor Series I Fidelity Income Fund
Fidelity Advisor Series II Fidelity Institutional
Fidelity Advisor Series III Tax-Exempt Cash Portfolios
Fidelity Advisor Series IV Fidelity Investment Trust
Fidelity Advisor Series V Fidelity Magellan Fund
Fidelity Advisor Series VI Fidelity Massachusetts
Fidelity Advisor Series VII Municipal Trust
Fidelity Advisor Series VIII Fidelity Money Market Trust
Fidelity Beacon Street Trust Fidelity Mt. Vernon Street
Fidelity Boston Street Trust Trust
Fidelity California Municipal Fidelity Municipal Trust
Trust Fidelity Municipal Trust II
Fidelity California Municipal Fidelity New York Municipal
Trust II Trust
Fidelity Capital Trust Fidelity New York Municipal
Fidelity Charles Street Trust Trust II
Fidelity Commonwealth Trust Fidelity Oxford Street Trust
Fidelity Concord Street Trust Fidelity Phillips Street Trust
Fidelity Congress Street Fund Fidelity Puritan Trust
Fidelity Contrafund Fidelity Revere Street Trust
Fidelity Court Street Trust Fidelity School Street Trust
Fidelity Court Street Trust II Fidelity Securities Fund
Fidelity Covington Trust Fidelity Select Portfolios
Fidelity Destiny Portfolios Fidelity Summer Street Trust
Fidelity Devonshire Trust Fidelity Trend Fund
Fidelity Exchange Fund Fidelity U.S.
Fidelity Financial Trust Investments-Bond Fund, L.P.
Fidelity Fixed-Income Trust Fidelity U.S.
Fidelity Government Investments-Government
Securities Fund Securities
Fund, L.P.
Fidelity Union Street Trust
Fidelity Union Street Trust II
Newbury Street Trust
Variable Insurance Products
Fund
Variable Insurance Products
Fund II
plus any other investment company for which Fidelity Management &
Research Company or an affiliate acts as investment adviser and for
which the undersigned individual serves as Directors, Trustees, or
General Partners (collectively, the "Funds"), hereby constitute and
appoint Arthur J. Brown, Arthur C. Delibert, Stephanie A. Djinis,
Robert C. Hacker, Thomas M. Leahey, Richard M. Phillips, and Dana L.
Platt, each of them singly, our true and lawful attorneys-in-fact,
with full power of substitution, and with full power to each of them,
to sign for us and in our names in the appropriate capacities, all
Registration Statements of the Funds on Form N-1A, Form N-8A or any
successor thereto, any and all subsequent Amendments, Pre-Effective
Amendments, or Post-Effective Amendments to said Registration
Statements on Form N-1A or any successor thereto, any Registration
Statements on Form N-14, and any supplements or other instruments in
connection therewith, and generally to do all such things in our names
and behalf in connection therewith as said attorneys-in-fact deems
necessary or appropriate, to comply with the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, and all
related requirements of the Securities and Exchange Commission. I
hereby ratify and confirm all that said attorneys-in-fact or their
substitutes may do or cause to be done by virtue hereof. This power
of attorney is effective for all documents filed on or after January
1, 2000.
WITNESS our hands on this sixteenth day of December, 1999.
/s/Edward C. Johnson 3d /s/Peter S. Lynch
Edward C. Johnson 3d Peter S. Lynch
/s/Ralph F. Cox /s/William O. McCoy
Ralph F. Cox William O. McCoy
/s/Phyllis Burke Davis /s/Gerald C. McDonough
Phyllis Burke Davis Gerald C. McDonough
/s/Ned C. Lautenbach /s/Marvin L. Mann
Ned C. Lautenbach Marvin L. Mann
/s/Donald J. Kirk /s/Thomas R. Williams
Donald J. Kirk Thomas R. Williams
/s/Robert C. Pozen /s/Robert M. Gates
Robert C. Pozen Robert M. Gates
POWER OF ATTORNEY
I, the undersigned Secretary of the investment companies for which
Fidelity Management & Research Company or an affiliate acts as
investment adviser (collectively, the "Funds"), hereby severally
constitute and appoint Arthur J. Brown, Arthur C. Delibert, Stephanie
A. Djinis, Robert C. Hacker, Thomas M. Leahey, Richard M. Phillips,
and Dana L. Platt, each of them singly, my true and lawful
attorneys-in-fact, with full power of substitution, and with full
power to each of them, to sign for me and in my name in the
appropriate capacity, any and all representations with respect to the
consistency of foreign language translation prospectuses with the
original prospectuses filed in connection with the Post-Effective
Amendments for the Funds as said attorneys-in-fact deem necessary or
appropriate to comply with the provisions of the Securities Act of
1933 and the Investment Company Act of 1940, and all related
requirements of the Securities and Exchange Commission. I hereby
ratify and confirm all that said attorneys-in-fact, or their
substitutes may do or cause to be done by virtue hereof. This power
of attorney is effective for all documents filed on or after January
1, 1998.
WITNESS my hand on this twenty-ninth day of December, 1997.
/s/Eric Roiter
Eric Roiter
EXHIBIT A(1)
AMENDED AND RESTATED DECLARATION OF TRUST
Fidelity Magellan Fund
AMENDED AND RESTATED DECLARATION OF TRUST, made April 19, 2000 by
each of the Trustees whose signature is affixed hereto (the
"Trustees").
WHEREAS, the Trustees desire to amend and restate this Declaration of
Trust for the sole purpose of supplementing the Declaration of Trust
to incorporate amendments duly adopted; and
WHEREAS, this Trust was initially made on June 25, 1984 by Edward C.
Johnson 3d, Caleb Loring, Jr., and Frank Nesvet in order to establish
a trust for the investment and reinvestment of funds contributed
thereto;
NOW, THEREFORE, the Trustees declare that all money and property
contributed to the trust hereunder shall be held and managed in trust
under this Amended and Restated Declaration of Trust as herein set
forth below.
ARTICLE I
NAME AND DEFINITIONS
NAME
SECTION 1. This Trust shall be known as "Fidelity Magellan Fund."
DEFINITIONS
SECTION 2. Wherever used herein, unless otherwise required by the
context or specifically provided:
(a) The terms "Affiliated Person," "Assignment," "Commission,"
"Interested Person," "Majority Shareholder Vote" (the 67% or 50%
requirement of the third sentence of Section 2(a)(42) of the 1940 Act,
whichever may be applicable), and "Principal Underwriter" shall have
the meanings given them in the 1940 Act, as modified by or interpreted
by any applicable order or orders of the Commission or any rules or
regulations adopted or interpretative releases of the Commission
thereunder;
(b) "Bylaws" shall mean the bylaws of the Trust, if any, as amended
from time to time;
(c) "Class" refers to the class of Shares of a Series of the Trust
established in accordance with the provisions of Article III;
(d) "Declaration of Trust" means this Amended and Restated
Declaration of Trust, as further amended or restated, from time to
time;
(e) "Net Asset Value" means the net asset value of each Series of
the Trust or Class thereof determined in the manner provided in
Article X, Section 3;
(f) "Shareholder" means a record owner of Shares of the Trust;
(g) "Shares" means the equal proportionate transferable units of
interest into which the beneficial interest of the Trust or each
Series shall be divided from time to time, including such Class or
Classes of Shares as the Trustees may from time to time create and
establish and including fractions of Shares as well as whole Shares as
consistent with the requirements of Federal and/or state securities
laws;
(h) "Series" refers to any series of Shares of the Trust established
in accordance with the provisions of Article III;
(i) "Trust" refers to Fidelity Magellan Fund and reference to the
Trust, when applicable to one or more Series of the Trust, shall refer
to any such Series;
(j) "Trustees" refer to the individual trustees in their capacity as
trustees hereunder of the Trust and their successor or successors for
the time being in office as such trustee or trustees; and
(k) "1940 Act" refers to the Investment Company Act of 1940, as
amended from time to time.
ARTICLE II
PURPOSE OF TRUST
The purpose of this Trust is to provide investors a continuous source
of managed investment in securities.
ARTICLE III
BENEFICIAL INTEREST
SHARES OF BENEFICIAL INTEREST
SECTION 1. The beneficial interest in the Trust shall be divided into
such transferable Shares of one or more separate and distinct Series
or Classes of Series as the Trustees shall, from time to time, create
and establish. The number of authorized Shares of each Series, and
Class thereof, is unlimited. Each Share shall be without par value and
shall be fully paid and nonassessable. The Trustees shall have full
power and authority, in their sole discretion, and without obtaining
any prior authorization or vote of the Shareholders of any Series or
Class of the Trust (a) to create and establish (and to change in any
manner) Shares or any Series or Classes thereof with such preferences,
voting powers, rights, and privileges as the Trustees may, from time
to time, determine; (b) to divide or combine the Shares or any Series
or Classes thereof into a greater or lesser number; (c) to classify or
reclassify any issued Shares into one or more Series or Classes of
Shares; (d) to abolish any one or more Series or Classes of Shares;
and (e) to take such action with respect to the Shares as the Trustees
may deem desirable.
ESTABLISHMENT OF SERIES AND CLASSES
SECTION 2. The establishment of any Series or Class thereof shall be
effective upon the adoption of a resolution by a majority of the then
Trustees setting forth such establishment and designation and the
relative rights and preferences of the Shares of such Series or Class,
whether directly in such resolution or by reference to, or approval
of, another document that sets forth such relative rights and
preferences of the Shares of such Series or Class including, without
limitation, any registration statement of the Trust, or as otherwise
provided in such resolution. At any time that there are no Shares
outstanding of any particular Series or Class previously established
and designated, the Trustees may by a majority vote abolish such
Series or Class and the establishment and designation thereof.
OWNERSHIP OF SHARES
SECTION 3. The ownership of Shares shall be recorded in the books of
the Trust or a transfer or similar agent. The Trustees may make such
rules as they consider appropriate for the transfer of Shares and
similar matters. The record books of the Trust as kept by the Trust or
by any transfer or similar agent, as the case may be, shall be
conclusive as to who are the holders of Shares and as to the number of
Shares held from time to time by each Shareholder.
INVESTMENT IN THE TRUST
SECTION 4. The Trustees shall accept investments in the Trust from
such persons and on such terms as they may, from time to time,
authorize. Such investments may be in the form of cash, securities, or
other property in which the appropriate Series is authorized to
invest, valued as provided in Article X, Section 3. After the date of
the initial contribution of capital, the number of Shares to represent
the initial contribution may in the Trustees' discretion be considered
as outstanding, and the amount received by the Trustees on account of
the contribution shall be treated as an asset of the Trust. Subsequent
investments in the Trust shall be credited to each Shareholder's
account in the form of full Shares at the Net Asset Value per Share
next determined after the investment is received; provided, however,
that the Trustees may, in their sole discretion (a) impose a sales
charge or other fee upon investments in the Trust or Series or any
Classes thereof, and (b) issue fractional Shares.
ASSETS AND LIABILITIES OF SERIES AND CLASSES
SECTION 5. All consideration received by the Trust for the issue or
sale of Shares of a particular Series, together with all assets in
which such consideration is invested or reinvested, all income,
earnings, profits, and proceeds thereof, including any proceeds
derived from the sale, exchange, or liquidation of such assets, and
any funds or payments derived from any reinvestment of such proceeds
in whatever form the same may be, shall be referred to as "assets
belonging to" that Series. In addition, any assets, income, earnings,
profits, and proceeds thereof, funds, or payments that are not readily
identifiable as belonging to any particular Series or Class, shall be
allocated by the Trustees between and among one or more of the Series
or Classes in such manner as they, in their sole discretion, deem fair
and equitable. Each such allocation shall be conclusive and binding
upon the Shareholders of all Series or Classes for all purposes and
shall be referred to as assets belonging to that Series or Class. The
assets belonging to a particular Series shall be so recorded upon the
books of the Trust or of its agent or agents and shall be held by the
Trustees in trust for the benefit of the holders of Shares of that
Series.
The assets belonging to each particular Series shall be charged with
the liabilities of that Series and all expenses, costs, charges, and
reserves attributable to that Series, except that liabilities and
expenses may, in the Trustees' discretion, be allocated solely to a
particular Class and, in which case, shall be borne by that Class. Any
general liabilities, expenses, costs, charges, or reserves of the
Trust that are not readily identifiable as belonging to any particular
Series or Class shall be allocated and charged by the Trustees between
or among any one or more of the Series or Classes in such manner as
the Trustees, in their sole discretion, deem fair and equitable and
shall be referred to as "liabilities belonging to" that Series or
Class. Each such allocation shall be conclusive and binding upon the
Shareholders of all Series or Classes for all purposes. Any creditor
of any Series may look only to the assets of that Series to satisfy
such creditor's debt. No Shareholder or former Shareholder of any
Series shall have a claim on or any right to any assets allocated or
belonging to any other Series.
NO PREEMPTIVE RIGHTS
SECTION 6. Shareholders shall have no preemptive or other right to
subscribe to any additional Shares or other securities issued by the
Trust or the Trustees.
STATUS OF SHARES AND LIMITATION OF PERSONAL LIABILITY
SECTION 7. Shares shall be deemed to be personal property giving only
the rights provided in this instrument. Every shareholder by virtue of
having become a shareholder shall be held to have expressly assented
and agreed to be bound by the terms hereof. No Shareholder of the
Trust and of each Series shall be personally liable for the debts,
liabilities, obligations, and expenses incurred by, contracted for, or
otherwise existing with respect to, the Trust or by or on behalf of
any Series. The Trustees shall have no power to bind any Shareholder
personally or to call upon any Shareholder for the payment of any sum
of money or assessment whatsoever other than such as the Shareholder
may, at any time, personally agree to pay by way of subscription for
any Shares or otherwise. Every note, bond, contract, or other
undertaking issued by or on behalf of the Trust or the Trustees
relating to the Trust or to a Series shall include a recitation
limiting the obligation represented thereby to the Trust or to one or
more Series and its or their assets (but the omission of such a
recitation shall not operate to bind any Shareholder or Trustee).
ARTICLE IV
THE TRUSTEES
MANAGEMENT OF THE TRUST
SECTION 1. The business and affairs of the Trust shall be managed by
the Trustees, and they shall have all powers necessary and desirable
to carry out that responsibility.
INITIAL TRUSTEES; ELECTION
SECTION 2. The initial Trustees shall be at least three individuals
who shall affix their signatures hereto. On a date fixed by the
Trustees, the Shareholders shall elect not less than three Trustees. A
Trustee shall not be required to be a Shareholder of the Trust.
TERM OF OFFICE OF TRUSTEES
SECTION 3. The Trustees shall hold office during the lifetime of this
Trust, and until its termination as hereinafter provided; except (a)
that any Trustee may resign his trust by written instrument signed by
him and delivered to the other Trustees, which shall take effect upon
such delivery or upon such later date as is specified therein; (b)
that any Trustee may be removed at any time by written instrument,
signed by at least two-thirds (2/3) of the number of Trustees prior to
such removal, specifying the date when such removal shall become
effective; (c) that any Trustee who requests in writing to be retired
or who has become incapacitated by illness or injury may be retired by
written instrument signed by a majority of the other Trustees,
specifying the date of his retirement; and (d) a Trustee may be
removed at any special meeting of the Trust by a vote of two-thirds
(2/3) of the outstanding Shares.
RESIGNATION AND APPOINTMENT OF TRUSTEES
SECTION 4. In case of the declination, death, resignation,
retirement, or removal of any of the Trustees, or in case a vacancy
shall, by reason of an increase in number of the Trustees, or for any
other reason, exist, the remaining Trustees shall fill such vacancy by
appointing such other person as they in their discretion shall see fit
consistent with the limitations under the 1940 Act. Such appointment
shall be evidenced by a written instrument signed by a majority of the
Trustees in office or by recording in the records of the Trust,
whereupon the appointment shall take effect. An appointment of a
Trustee may be made by the Trustees then in office in anticipation of
a vacancy to occur by reason of retirement, resignation, or increase
in number of Trustees effective at a later date, provided that said
appointment shall become effective only at or after the effective date
of said retirement, resignation, or increase in number of Trustees. As
soon as any Trustee so appointed shall have accepted this Trust, the
Trust estate shall vest in the new Trustee or Trustees, together with
the continuing Trustees, without any further act or conveyance, and he
shall be deemed a Trustee hereunder. The foregoing power of
appointment is subject to the provisions of Section 16(a) of the 1940
Act, as modified by or interpreted by any applicable order or orders
of the Commission or any rules or regulations adopted or
interpretative releases of the Commission.
TEMPORARY ABSENCE OF TRUSTEES
SECTION 5. Any Trustee may, by power of attorney, delegate his power
for a period not exceeding six (6) months at any one time to any other
Trustee or Trustees, provided that in no case shall less than two
Trustees personally exercise the other powers hereunder except as
herein otherwise expressly provided.
NUMBER OF TRUSTEES
SECTION 6. The number of Trustees, not less than three (3) nor more
than twelve (12), serving hereunder at any time shall be determined by
the Trustees themselves.
Whenever a vacancy in the Board of Trustees shall occur, until such
vacancy is filled, or while any Trustee is physically or mentally
incapacitated by reason of disease or otherwise, the other Trustees
shall have all the powers hereunder and the certificate of the other
Trustees of such vacancy or incapacity shall be conclusive.
EFFECT OF DEATH, RESIGNATION, ETC. OF A TRUSTEE
SECTION 7. The death, declination, resignation, retirement, removal,
incapacity, or inability of the Trustees, or any one of them, shall
not operate to annul the Trust or to revoke any existing agency
created pursuant to the terms of this Declaration of Trust.
OWNERSHIP OF ASSETS OF THE TRUST
SECTION 8. The assets of the Trust shall be held separate and apart
from any assets now or hereafter held in any capacity other than as
Trustee hereunder by the Trustees or any successor Trustees. All of
the assets of the Trust shall at all times be considered as vested in
the Trustees. No Shareholder shall be deemed to have a severable
ownership in any individual asset of the Trust or any right of
partition or possession thereof, but each Shareholder shall have a
proportionate undivided beneficial interest in the Trust or Series.
ARTICLE V
POWERS OF THE TRUSTEES
POWERS
SECTION 1. The Trustees, in all instances, shall act as principals
and are and shall be free from the control of the Shareholders. The
Trustees shall have full power and authority to do any and all acts
and to make and execute any and all contracts and instruments that
they may consider necessary or appropriate in connection with the
management of the Trust. Except as otherwise provided herein or in the
1940 Act, the Trustees shall not in any way be bound or limited by
present or future laws or customs in regard to trust investments, but
shall have full authority and power to make any and all investments
that they, in their discretion, shall deem proper to accomplish the
purpose of this Trust. Subject to any applicable limitation in this
Declaration of Trust or the Bylaws of the Trust, if any, the Trustees
shall have power and authority:
(a) To invest and reinvest cash and other property, and to hold cash
or other property uninvested without, in any event, being bound or
limited by any present or future law or custom in regard to
investments by Trustees, and to sell, exchange, lend, pledge,
mortgage, hypothecate, write options on, and lease any or all of the
assets of the Trust.
(b) To adopt Bylaws not inconsistent with this Declaration of Trust
providing for the conduct of the business of the Trust and to amend
and repeal them to the extent that they do not reserve that right to
the Shareholders.
(c) To elect and remove such officers and appoint and terminate such
agents as they consider appropriate.
(d) To employ one or more banks, trust companies, companies that are
members of a national securities exchange, or other entities permitted
under the 1940 Act, as modified by or interpreted by any applicable
order or orders of the Commission or any rules or regulations adopted
or interpretative releases of the Commission thereunder, as custodians
of any assets of the Trust subject to any conditions set forth in this
Declaration of Trust or in the Bylaws, if any.
(e) To retain a transfer agent and Shareholder servicing agent, or
both.
(f) To provide for the distribution of interests of the Trust either
through a Principal Underwriter in the manner hereinafter provided for
or by the Trust itself, or both.
(g) To set record dates in the manner hereinafter provided for.
(h) To delegate such authority as they consider desirable to any
officers of the Trust and to any investment adviser, manager,
custodian, underwriter, or other agent or independent contractor.
(i) To sell or exchange any or all of the assets of the Trust,
subject to the provisions of Article XII, Section 4 hereof.
(j) To vote or give assent or exercise any rights of ownership with
respect to stock or other securities or property; and to execute and
deliver powers of attorney to such person or persons as the Trustees
shall deem proper, granting to such person or persons such power and
discretion with relation to securities or property as the Trustees
shall deem proper.
(k) To exercise powers and rights of subscription or otherwise which
in any manner arise out of ownership of securities.
(l) To hold any security or property in a form not indicating any
trust, whether in bearer, unregistered, or other negotiable form; or
either in its own name or in the name of a custodian or a nominee or
nominees.
(m) To establish separate and distinct Series with separately
defined investment objectives and policies and distinct investment
purposes in accordance with the provisions of Article III and to
establish Classes of such Series having relative rights, powers, and
duties as the Trustees may provide consistent with applicable laws.
(n) To allocate assets, liabilities, and expenses of the Trust to a
particular Series or Class, as appropriate, or to apportion the same
between or among two or more Series, or classes, as appropriate,
provided that any liabilities or expenses incurred by a particular
Series or Class shall be payable solely out of the assets belonging to
that Series as provided for in Article III.
(o) To consent to or participate in any plan for the reorganization,
consolidation, or merger of any corporation or concern, any security
of which is held in the Trust; to consent to any contract, lease,
mortgage, purchase, or sale of property by such corporation or
concern, and to pay calls or subscriptions with respect to any
security held in the Trust.
(p) To compromise, arbitrate, or otherwise adjust claims in favor of
or against the Trust or any matter in controversy, including, but not
limited to, claims for taxes.
(q) To make distributions of income and of capital gains to
Shareholders in the manner hereinafter provided for.
(r) To borrow money, and to pledge, mortgage, or hypothecate the
assets of the Trust, subject to the applicable requirements of the
1940 Act.
(s) To establish, from time to time, a minimum total investment for
Shareholders and to require the redemption of the Shares of any
Shareholders whose investment is less than such minimum upon giving
notice to such Shareholder.
(t) To operate as and carry on the business of an investment company
and to exercise all the powers necessary and appropriate to the
conduct of such operations.
(u) To interpret the investment policies, practices or limitations
of any Series.
(v) To issue, sell, repurchase, redeem, retire, cancel, acquire,
hold, resell, reissue, dispose of, and otherwise deal in Shares and,
subject to the provisions set forth in Article III and Article X, to
apply to any such repurchase, redemption, retirement, cancellation or
acquisition of Shares any funds or property of the Trust, or the
particular Series of the Trust, with respect to which such Shares are
issued.
(w) Notwithstanding any other provision hereof, to invest all or a
portion of the assets of any Series in one or more open-end investment
companies, including investment by means of transfer of such assets in
exchange for an interest or interests in such investment company or
companies or by any other method approved by the Trustees.
(x) In general to carry on any other business in connection with or
incidental to any of the foregoing powers, to do everything necessary,
suitable or proper for the accomplishment of any purpose or the
attainment of any object or the furtherance of any power hereinbefore
set forth, either alone or in association with others, and to do every
other act or thing incidental or appurtenant to or growing out of or
connected with the aforesaid business or purposes, objects or powers.
The foregoing clauses shall be construed both as objects and powers,
and the foregoing enumeration of specific powers shall not be held to
limit or restrict in any manner the general powers of the Trustees.
Any action by one or more of the Trustees in their capacity as such
hereunder shall be deemed an action on behalf of the Trust or the
applicable Series and not an action in an individual capacity.
The Trustees shall not be limited to investing in obligations
maturing before the possible termination of the Trust or any Series or
Class thereof.
No one dealing with the Trustees shall be under any obligation to
make any inquiry concerning the authority of the Trustees, or to see
to the application of any payments made or property transferred to the
Trustees or upon their order.
TRUSTEES AND OFFICERS AS SHAREHOLDERS
SECTION 2. Any Trustee, officer or other agent of the Trust may
acquire, own and dispose of Shares to the same extent as if he were
not a Trustee, officer or agent; and the Trustees may issue and sell
or cause to be issued and sold Shares to and buy such Shares from any
such person of any firm or company in which he is interested, subject
only to the general limitations herein contained as to the sale and
purchase of such Shares; and all subject to any restrictions which may
be contained in the Bylaws, if any.
ACTION BY THE TRUSTEES
SECTION 3. Except as otherwise provided herein or in the 1940 Act,
the Trustees shall act by majority vote at a meeting duly called or by
unanimous written consent without a meeting or by telephone consent
provided a quorum of Trustees participate in any such telephonic
meeting, unless the 1940 Act requires that a particular action be
taken only at a meeting at which the Trustees are present in person.
At any meeting of the Trustees, a majority of the Trustees shall
constitute a quorum. Meetings of the Trustees may be called orally or
in writing by the Chairman of the Trustees or by any two other
Trustees. Notice of the time, date, and place of all meetings of the
Trustees shall be given by the party calling the meeting to each
Trustee by telephone, telefax, telegram, or other electro-mechanical
means sent to his home or business address at least twenty-four (24)
hours in advance of the meeting or by written notice mailed to his
home or business address at least seventy-two (72) hours in advance of
the meeting. Notice need not be given to any Trustee who attends the
meeting without objecting to the lack of notice or who executes a
written waiver of notice with respect to the meeting. Subject to the
requirements of the 1940 Act, the Trustees by majority vote may
delegate to any one of their number their authority to approve
particular matters or take particular actions on behalf of the Trust.
Written consents or waivers of Trustees may be executed in one or more
counterparts. Execution of a written consent or waiver and delivery
thereof to the Trust may be accomplished by telefax or other
electro-mechanical means.
CHAIRMAN OF THE TRUSTEES
SECTION 4. The Trustees may appoint one of their number to be
Chairman of the Board of Trustees. The Chairman shall preside at all
meetings of the Trustees, shall be responsible for the execution of
policies established by the Trustees and the administration of the
Trust, and may be the chief executive, financial and accounting
officer of the Trust.
ARTICLE VI
EXPENSES OF THE TRUST
TRUSTEE REIMBURSEMENT
SECTION 1. Subject to the provisions of Article III, Section 5, the
Trustees shall be reimbursed from Trust estate or the assets belonging
to the appropriate Series for their expenses and disbursements,
including, without limitation, fees and expenses of Trustees who are
not Interested Persons of the Trust; interest expense, taxes, fees and
commissions of every kind; expenses of pricing Trust portfolio
securities; expenses of issue, repurchase and redemption of shares
including expenses attributable to a program of periodic repurchases
or redemptions, expenses of registering and qualifying the Trust and
its Shares under Federal and state laws and regulations; charges of
custodians, transfer agents, and registrars; expenses of preparing and
setting up in type prospectuses and statements of additional
information; expenses of printing and distributing prospectuses sent
to existing Shareholders; auditing and legal expenses; reports to
Shareholders; expenses of meetings of Shareholders and proxy
solicitations therefor; insurance expense; association membership
dues; and for such non-recurring items as may arise, including
litigation to which the Trust is a party; and for all losses and
liabilities by them incurred in administering the Trust, and for the
payment of such expenses, disbursements, losses, and liabilities the
Trustees shall have a lien on the assets belonging to the appropriate
Series prior to any rights or interests of the Shareholders thereto.
This section shall not preclude the Trust from directly paying any of
the aforementioned fees and expenses.
ARTICLE VII
INVESTMENT ADVISER, PRINCIPAL UNDERWRITER, AND TRANSFER AGENT
INVESTMENT ADVISER
SECTION 1. Subject to applicable requirements of the 1940 Act, as
modified by or interpreted by any applicable order of the Commission
or any rules or regulations adopted or interpretative releases of the
Commission thereunder, the Trustees may, in their discretion and from
time to time, enter into an investment advisory or management
contract(s) with respect to the Trust or any Series thereof whereby
the other party(ies) to such contract(s) shall undertake to furnish
the Trustees such management, investment advisory, statistical, and
research facilities and services and such other facilities and
services, if any, and all upon such terms and conditions, as the
Trustees may, in their discretion, determine. Notwithstanding any
provisions of this Declaration of Trust, the Trustees may authorize
the investment adviser(s) (subject to such general or specific
instructions as the Trustees may from time to time adopt) to effect
purchases, sales or exchanges of portfolio securities and other
investment instruments of the Trust on behalf of the Trustees or may
authorize any officer, agent, or Trustee to effect such purchases,
sales, or exchanges pursuant to recommendations of the investment
adviser (and all without further action by the Trustees). Any such
purchases, sales, and exchanges shall be deemed to have been
authorized by all of the Trustees.
The Trustees may, subject to applicable requirements of the 1940 Act,
as modified by or interpreted by any applicable order or orders of the
Commission or any rules or regulations adopted or interpretative
releases of the Commission thereunder, including those relating to
Shareholder approval, authorize the investment adviser to employ one
or more sub-advisers from time to time to perform such of the acts and
services of the investment adviser, and upon such terms and
conditions, as may be agreed upon between the investment adviser and
sub-adviser.
PRINCIPAL UNDERWRITER
SECTION 2. The Trustees may in their discretion from time to time
enter into an exclusive or non-exclusive contract(s) on behalf of the
Trust or any Series or Class thereof providing for the sale of the
Shares, whereby the Trust may either agree to sell the Shares to the
other party to the contract or appoint such other party its sales
agent for such Shares. In either case, the contract shall be on such
terms and conditions as may be prescribed in the Bylaws, if any, and
such further terms and conditions as the Trustees may, in their
discretion, determine not inconsistent with the provisions of this
Article VII or of the Bylaws, if any. Such contract may also if any
provide for the repurchase or sale of Shares by such other party as
principal or as agent of the Trust.
TRANSFER AGENT
SECTION 3. The Trustees may, in their discretion and from time to
time, enter into one or more transfer agency and Shareholder service
contracts whereby the other party shall undertake to furnish the
Trustees with transfer agency and Shareholder services. Such contracts
shall be on such terms and conditions as the Trustees may, in their
discretion, determine not inconsistent with the provisions of this
Declaration of Trust or of the Bylaws, if any. Such services may be
provided by one or more entities.
PARTIES TO CONTRACT
SECTION 4. Any contract of the character described in Sections 1, 2
and 3 of this Article VII or in Article IX hereof may be entered into
with any corporation, firm, partnership, trust or association,
although one or more of the Trustees or officers of the Trust may be
an officer, director, trustee, shareholder, or member of such other
party to the contract, and no such contract shall be invalidated or
rendered voidable by reason of the existence of any relationship, nor
shall any person holding such relationship be liable merely by reason
of such relationship for any loss or expense to the Trust under or by
reason of said contract or accountable for any profit realized
directly or indirectly therefrom, provided that the contract when
entered into was reasonable and fair and not inconsistent with the
provisions of this Article VII or the Bylaws, if any. The same person
(including a firm, corporation, partnership, trust, or association)
may be the other party to contracts entered into pursuant to Sections
1, 2 and 3 above or Article IX, and any individual may be financially
interested or otherwise affiliated with persons who are parties to any
or all of the contracts mentioned in this Section 4.
PROVISIONS AND AMENDMENTS
SECTION 5. Any contract entered into pursuant to Sections 1 and 2 of
this Article VII shall be consistent with and subject to the
requirements of Section 15 of the 1940 Act, as modified by or
interpreted by any applicable order or orders of the Commission or any
rules or regulations adopted rules or regulations adopted or
interpretative releases of the Commission (or other applicable Act of
Congress hereafter enacted), with respect to its continuance in
effect, its amendment, its termination, and the method of
authorization and approval of such contract or renewal thereof.
ARTICLE VIII
SHAREHOLDERS' VOTING POWERS AND MEETINGS
VOTING POWERS
SECTION 1. The Shareholders shall have power to vote (a) for the
election of Trustees as provided in Article IV, Section 2(b); for the
removal of Trustees as provided in Article IV, Section 3(d); (c) with
respect to any investment advisory or management contract as provided
in Article VII, Sections 1 and 5; (d) with respect to any termination,
merger, consolidation, reorganization, or sale of assets of the Trust
or any of its Series or Classes as provided in Article XII, Section 4;
(e) with respect to the amendment of this Declaration of Trust as
provided in Article XII, Section 7; (f) to the same extent as the
shareholders of a Massachusetts business corporation, as to whether or
not a court action, proceeding or claim should be brought or
maintained derivatively or as a class action on behalf of the Trust or
the Shareholders, provided, however, that a Shareholder of a
particular Series shall not be entitled to bring any derivative or
class action on behalf of any other Series of the Trust; and (g) with
respect to such additional matters relating to the Trust as may be
required or authorized by law, by this Declaration of Trust, or the
Bylaws of the Trust, if any, or any registration of the Trust with the
Commission or any state, as the Trustees may consider desirable.
On any matter submitted to a vote of the Shareholders, all Shares
shall be voted by individual Series, except as provided in the
following sentence and except (a) when required by the 1940 Act,
Shares shall be voted in the aggregate and not by individual Series;
and (b) when the Trustees have determined that the matter affects only
the interests of one or more Series, then only the Shareholders of
such Series shall be entitled to vote thereon. The Trustees may also
determine that a matter affects only the interests of one or more
Classes of a Series, in which case, any such matter shall be voted on
by such Class or Classes. A Shareholder of each Series or Class
thereof shall be entitled to one vote for each dollar of net asset
value (number of Shares owned times net asset value per share) of such
Series or Class thereof on any matter on which such Shareholder is
entitled to vote, and each fractional dollar amount shall be entitled
to a proportionate fractional vote. There shall be no cumulative
voting in the election of Trustees. Shares may be voted in person or
by proxy. Until Shares are issued, the Trustees may exercise all
rights of Shareholders and may take any action required or permitted
by law, this Declaration of Trust or any Bylaws of the Trust, if any,
to be taken by Shareholders.
MEETINGS
SECTION 2. The first Shareholders' meeting shall be held as specified
in Section 2 of Article IV at the principal office of the Trust or
such other place as the Trustees may designate. Special meetings of
the Shareholders of any Series may be called by the Trustees and shall
be called by the Trustees upon the written request of Shareholders
owning at least one-tenth (1/10) of the outstanding Shares entitled to
vote. Whenever ten or more Shareholders meeting the qualifications set
forth in Section 16(c) of the 1940 Act, as modified by or interpreted
by any applicable order or orders of the Commission or any rules or
regulations adopted or interpretative releases of the Commission, seek
the opportunity of furnishing materials to the other Shareholders with
a view to obtaining signatures on such a request for a meeting, the
Trustees shall comply with the provisions of said Section 16(c) with
respect to providing such Shareholders access to the list of the
Shareholders of record of the Trust or the mailing of such materials
to such Shareholders of record. Shareholders shall be entitled to at
least fifteen (15) days' notice of any meeting.
QUORUM AND REQUIRED VOTE
SECTION 3. A majority of Shares entitled to vote in person or by
proxy shall be a quorum for the transaction of business at a
Shareholders' meeting, except that where any provision of law or of
this Declaration of Trust permits or requires that holders of any
Series or Class shall vote as a Series or Class then a majority of the
aggregate number of Shares of that Series or Class entitled to vote
shall be necessary to constitute a quorum for the transaction of
business by that Series or Class. Any lesser number shall be
sufficient for adjournments. Any adjourned session or sessions may be
held, within a reasonable time after the date set for the original
meeting, without the necessity of further notice. Except when a larger
vote is required by applicable law or by any provision of this
Declaration of Trust or the Bylaws, if any, a majority of the Shares
voted in person or by proxy shall decide any questions and a plurality
shall elect a Trustee, provided that where any provision of law or of
this Declaration of Trust permits or requires that the holders of any
Series or Class shall vote as a Series or Class, then a majority of
the Shares of that Series or Class voted on the matter shall decide
that matter insofar as that Series or Class is concerned. Shareholders
may act by unanimous written consent. Actions taken by a Series or
Class may be consented to unanimously in writing by Shareholders of
that Series or Class.
ARTICLE IX
CUSTODIAN
APPOINTMENT AND DUTIES
SECTION 1. The Trustees shall at all times employ a bank, a company
that is a member of a national securities exchange, trust company, or
other entity permitted under the 1940 Act, as modified by or
interpreted by any applicable order or orders of the Commission or any
rules or regulations adopted or interpretative releases of the
Commission thereunder, having capital, surplus, and undivided profits
of at least two million dollars ($2,000,000), or such other amount as
shall be allowed by the Commission or by the 1940 Act, as custodian
with authority as its agent, but subject to such restrictions,
limitations and other requirements, if any, as may be contained in the
Bylaws of the Trust, if any:
(1) to hold the securities owned by the Trust and deliver the same
upon written order or oral order, if confirmed in writing, or by such
electro-mechanical or electronic devices as are agreed to by the Trust
and the custodian, if such procedures have been authorized in writing
by the Trust;
(2) to receive and receipt for any moneys due to the Trust and
deposit the same in its own banking department or elsewhere as the
Trustees may direct; and
(3) to disburse such funds upon orders or vouchers;
and the Trust may also employ such custodian as its agent:
(1) to keep the books and accounts of the Trust and furnish clerical
and accounting services; and
(2) to compute, if authorized to do so, the Net Asset Value of any
Series or Class thereof in accordance with the provisions hereof; all
upon such basis of compensation as may be agreed upon between the
Trustees and the custodian.
The Trustees may also authorize the custodian to employ one or more
sub-custodians from time to time to perform such of the acts and
services of the custodian, and upon such terms and conditions, as may
be agreed upon between the custodian and such sub-custodian and
approved by the Trustees, provided that in every case such
sub-custodian shall be a bank, a company that is a member of a
national securities exchange, trust company, or other entity permitted
under the 1940 Act, as modified by or interpreted by any applicable
order or orders of the Commission or any rules or regulations adopted
or interpretative releases of the Commission thereunder, having
capital, surplus, and undivided profits of at least two million
dollars ($2,000,000), or such other amount as shall be allowed by the
Commission or by the 1940 Act.
CENTRAL DEPOSITORY SYSTEM
SECTION 2. Subject to such rules, regulations and orders as the
Commission may adopt, the Trustees may direct the custodian to deposit
all or any part of the securities owned by the Trust in a system for
the central handling of securities established by a national
securities exchange or a national securities association registered
with the Commission under the Securities Exchange Act of 1934 or such
other person as may be permitted by the Commission or otherwise in
accordance with the 1940 Act, pursuant to which system all securities
of any particular class or series of any issuer deposited within the
system are treated as fungible and may be transferred or pledged by
bookkeeping entry without physical delivery of such securities;
provided that all such deposits shall be subject to withdrawal only
upon the order of the Trust or its custodian, subcustodians, or other
authorized agents.
ARTICLE X
DISTRIBUTIONS, REDEMPTIONS AND DETERMINATION
OF NET ASSET VALUE
DISTRIBUTIONS
SECTION 1.
(a) The Trustees may from time to time declare and pay dividends.
The amount of such dividends and the payment of them shall be wholly
in the discretion of the Trustees.
(b) The Trustees shall have the power, to the fullest extent
permitted by the laws of Massachusetts, at any time to declare and
cause to be paid dividends on Shares of a particular Series, from the
assets belonging to that Series, which dividends, at the election of
the Trustees, may be paid daily or otherwise pursuant to a standing
resolution or resolutions adopted only once or with such frequency as
the Trustees may determine, and may be payable in Shares of that
Series, or Classes thereof, at the election of each Shareholder of
that Series.
The Trustees may adopt and offer to Shareholders such dividend
reinvestment plans, cash dividend payout plans, or related plans as
the Trustees shall deem appropriate.
(c) Anything in this instrument to the contrary notwithstanding, the
Trustees may at any time declare and distribute a dividend of stock or
other property pro rata among the Shareholders of a particular Series,
or Class thereof, as of the record date of that Series or Class fixed
as provided in Article XII, Section 3.
REDEMPTIONS
SECTION 2. In case any holder of record of Shares of a particular
Series or Class of a Series desires to dispose of his Shares, he may
deposit at the office of the transfer agent or other authorized agent
of that Series a written request or such other form of request as the
Trustees may, from time to time, authorize, requesting that the Series
purchase the Shares in accordance with this Section 2; and the
Shareholder so requesting shall be entitled to require the Series to
purchase, and the Series or the principal underwriter of the Series
shall purchase his said Shares, but only at the Net Asset Value
thereof (as described in Section 3 hereof). The Series shall make
payment for any such Shares to be redeemed, as aforesaid, in cash or
property from the assets of that Series, and payment for such Shares
less any applicable deferred sales charges and/or fees shall be made
by the Series or the principal underwriter of the Series to the
Shareholder of record within seven (7) days after the date upon which
the request is effective.
DETERMINATION OF NET ASSET VALUE AND VALUATION OF PORTFOLIO ASSETS
SECTION 3. The term "Net Asset Value" of any Series or Class shall
mean that amount by which the assets of that Series or Class exceed
its liabilities, all as determined by or under the direction of the
Trustees. Such value per Share shall be determined separately for each
Series or Class of Shares and shall be determined on such days and at
such times as the Trustees may determine. Such determination shall be
made with respect to securities for which market quotations are
readily available, at the market value of such securities; and with
respect to other securities and assets, at the fair value as
determined in good faith by the Trustees, provided, however, that the
Trustees, without Shareholder approval, may alter the method of
appraising portfolio securities insofar as permitted under the 1940
Act and the rules, regulations, and interpretations thereof
promulgated or issued by the Commission or insofar as permitted by any
order of the Commission applicable to the Series. The Trustees may
delegate any of its powers and duties under this Section 3 with
respect to appraisal of assets and liabilities. At any time, the
Trustees may cause the value per Share last determined to be
determined again in a similar manner and may fix the time when such
redetermined value shall become effective.
SUSPENSION OF THE RIGHT OF REDEMPTION
SECTION 4. The Trustees may declare a suspension of the right of
redemption or postpone the date of payment as permitted under the 1940
Act. Such suspension shall take effect at such time as the Trustees
shall specify, but not later than the close of business on the
business day next following the declaration of suspension, and
thereafter there shall be no right of redemption or payment until the
Trustees shall declare the suspension at an end. In the case of a
suspension of the right of redemption, a Shareholder may either
withdraw his request for redemption or receive payment based on the
Net Asset Value per Share existing after the termination of the
suspension. In the event that any Series is divided into Classes, the
provisions of this Section, to the extent applicable as determined in
the discretion of the Trustees and consistent with applicable law, may
be equally applied to each such Class.
REDEMPTION OF SHARES
SECTION 5. The Trustees may require Shareholders to redeem Shares for
any reason under terms set by the Trustees, including, but not limited
to, (i) the determination of the Trustees that direct or indirect
ownership of Shares of any Series has or may become concentrated in
such Shareholder to an extent that would disqualify any Series as a
regulated investment company under the Internal Revenue Code of 1986,
as amended (or any successor statute thereto), (ii) the failure of a
Shareholder to supply a tax identification number if required to do
so, or (iii) the failure of a Shareholder to pay when due for the
purchase of Shares issued to him. The redemption shall be effected at
the redemption price and in the manner provided in this Article X.
The holders of Shares shall upon demand disclose to the Trustees in
writing such information with respect to direct and indirect ownership
of Shares as the Trustees deem necessary to comply with the provisions
of the Internal Revenue Code, or to comply with the requirements of
any other taxing authority.
ARTICLE XI
LIMITATION OF LIABILITY AND INDEMNIFICATION
LIMITATION OF LIABILITY
SECTION 1. Provided they have exercised reasonable care and have
acted under the reasonable belief that their actions are in the best
interest of the Trust, the Trustees shall not be responsible for or
liable in any event for neglect or wrongdoing of them or any officer,
agent, employee, or investment adviser of the Trust, but nothing
contained herein shall protect any Trustee against any liability to
which he would otherwise be subject by reason of willful misfeasance,
bad faith, gross negligence, or reckless disregard of the duties
involved in the conduct of his office.
INDEMNIFICATION OF COVERED PERSONS
SECTION 2.
(a) Subject to the exceptions and limitations contained in Section
(b) below:
(i) every person who is, or has been, a Trustee or officer of the
Trust (hereinafter referred to as "Covered Person") shall be
indemnified by the appropriate Series to the fullest extent permitted
by law against liability and against all expenses reasonably incurred
or paid by him in connection with any claim, action, suit, or
proceeding in which he becomes involved as a party or otherwise by
virtue of his being or having been a Trustee or officer and against
amounts paid or incurred by him in the settlement thereof;
(ii) the words "claim," "action," "suit," or "proceeding" shall
apply to all claims, actions, suits or proceedings (civil, criminal or
other, including appeals), actual or threatened while in office or
thereafter, and the words "liability" and "expenses" shall include,
without limitation, attorneys' fees, costs, judgments, amounts paid in
settlement, fines, penalties and other liabilities.
(b) No indemnification shall be provided hereunder to a Covered
Person:
(i) who shall have been adjudicated by a court or body before which
the proceeding was brought (A) to be liable to the Trust or its
Shareholders by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct
of his office; or (B) not to have acted in good faith in the
reasonable belief that his action was in the best interest of the
Trust; or
(ii) in the event of a settlement, unless there has been a
determination that such Trustee or officer did not engage in willful
misfeasance, bad faith, gross negligence, or reckless disregard of the
duties involved in the conduct of his office,
(A) by the court or other body approving the settlement;
(B) by at least a majority of those Trustees who are neither
Interested Persons of the Trust nor are parties to the matter based
upon a review of readily available facts (as opposed to a full
trial-type inquiry); or
(C) by written opinion of independent legal counsel based upon a
review of readily available facts (as opposed to a full trial-type
inquiry;
provided, however, that any Shareholder may, by appropriate legal
proceedings, challenge any such determination by the Trustees, or by
independent counsel.
(c) The rights of indemnification herein provided may be insured
against by policies maintained by the Trust, shall be severable, shall
not be exclusive of or affect any other rights to which any Covered
Person may now or hereafter be entitled, shall continue as to a person
who has ceased to be such Trustee or officer, and shall inure to the
benefit of the heirs, executors, and administrators of such a person.
Nothing contained herein shall affect any rights to indemnification to
which Trust personnel, other than Trustees and officers, and other
persons may be entitled by contract or otherwise under law.
(d) Expenses in connection with the preparation and presentation of
a defense to any claim, action, suit, or proceeding of the character
described in Paragraph (a) of this Section 2 may be paid by the
applicable Series from time to time prior to final disposition thereof
upon receipt of an undertaking by or on behalf of such Covered Person
that such amount will be paid over by him to the applicable Series if
it is ultimately determined that he is not entitled to indemnification
under this Section 2; provided, however, that either (i) such Covered
Person shall have provided appropriate security for such undertaking;
(ii) the Trust is insured against losses arising out of any such
advance payments; or (iii) either a majority of the Trustees who are
neither interested persons of the Trust nor parties to the matter, or
independent legal counsel in a written opinion, shall have determined,
based upon a review of readily available facts (as opposed to a
trial-type inquiry or full investigation), that there is reason to
believe that such Covered Person will be found entitled to
indemnification under this Section 2.
INDEMNIFICATION OF SHAREHOLDERS
SECTION 3. In case any Shareholder or former Shareholder of any
Series of the Trust shall be held to be personally liable solely by
reason of his being or having been a Shareholder and not because of
his acts or omissions or for some other reason, the Shareholder or
former Shareholder (or his heirs, executors, administrators, or other
legal representatives or, in the case of a corporation or other
entity, its corporate or other general successor) shall be entitled
out of the assets belonging to the applicable Series to be held
harmless from and indemnified against all loss and expense arising
from such liability. The Series shall, upon request by the
Shareholder, assume the defense of any claim made against the
Shareholder for any act or obligation of the Series and satisfy any
judgment thereon.
ARTICLE XII
MISCELLANEOUS
TRUST NOT A PARTNERSHIP, ETC.
SECTION 1. It is hereby expressly declared that a trust is created
hereby and not a partnership, joint stock association, corporation,
bailment, or any form of a legal relationship other than a trust. No
Trustee hereunder shall have any power to personally bind either the
Trust's officers or any Shareholder. All persons extending credit to,
contracting with, or having any claim against the Trust or the
Trustees shall look only to the assets of the appropriate Series for
payment under such credit, contract, or claim; and neither the
Shareholders nor the Trustees, nor any of their agents, whether past,
present, or future, shall be personally liable therefor. Nothing in
this Declaration of Trust shall protect a Trustee against any
liability to which the Trustee would otherwise be subject by reason of
willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of the office of
Trustee hereunder.
TRUSTEES' GOOD FAITH ACTION, EXPERT ADVICE, NO BOND OR SURETY
SECTION 2. The exercise by the Trustees of their powers and
discretions hereunder in good faith and with reasonable care under the
circumstances then prevailing, shall be binding upon everyone
interested. Subject to the provisions of Section 1 of this Article XII
and to Article XI, the Trustees shall not be liable for errors of
judgment or mistakes of fact or law. The Trustees may take advice of
counsel or other experts with respect to the meaning and operation of
this Declaration of Trust, and subject to the provisions of Section 1
of this Article XII and to Article XI, shall be under no liability for
any act or omission in accordance with such advice or for failing to
follow such advice. The Trustees shall not be required to give any
bond as such, nor any surety if a bond is obtained.
ESTABLISHMENT OF RECORD DATES
SECTION 3. The Trustees may close the stock transfer books of the
Trust for a period not exceeding sixty (60) days preceding the date of
any meeting of Shareholders, or the date for the payment of any
dividends, or the date for the allotment of rights, or the date when
any change or conversion or exchange of Shares shall go into effect;
or in lieu of closing the stock transfer books as aforesaid, the
Trustees may fix in advance a date not exceeding sixty (60) days
preceding the date of any meeting of Shareholders, or the date for
payment of any dividends, or the date for the allotment of rights, or
the date when any change or conversion or exchange of Shares shall go
into effect, as a record date for the determination of the
Shareholders entitled to notice of, and to vote at, any such meeting,
or entitled to receive payment of any such dividend, or to any such
allotment of rights, or to exercise the rights in respect of any such
change, conversion or exchange of Shares, and in such case such
Shareholders and only such Shareholders as shall be Shareholders of
record on the date so fixed shall be entitled to such notice of, and
to vote at, such meeting, or to receive payment of such dividend, or
to receive such allotment or rights, or to exercise such rights, as
the case may be, notwithstanding any transfer of any Shares on the
books of the Trust after any such record date fixed or aforesaid.
DURATION; TERMINATION OF TRUST, A SERIES OR A CLASS; MERGERS, ETC.
SECTION 4.1. DURATION. The Trust shall continue without limitation
of time, but subject to the provisions of this Article XII.
SECTION 4.2. TERMINATION OF THE TRUST, A SERIES OR A CLASS. (a)
Subject to applicable Federal and state law, the Trust or any Series
or Class thereof may be terminated (i) by Majority Shareholder Vote of
the Trust, each Series affected, or each Class affected, as the case
may be; or (ii) without the vote or consent of Shareholders by a
majority of the Trustees either at a meeting or by written consent.
The Trustees shall provide written notice to the affected Shareholders
of a termination effected under clause (ii) above. Upon the
termination of the Trust or the Series or Class,
(i) the Trust or the Series or Class shall carry on no business
except for the purpose of winding up its affairs;
(ii) the Trustees shall proceed to wind up the affairs of the Trust
or the Series or Class, and all of the powers of the Trustees under
this Declaration of Trust shall continue until the affairs of the
Trust shall have been wound up, including the power to fulfill or
discharge the contracts of the Trust or the Series or Class thereof;
collect its assets; sell, convey, assign, exchange, transfer, or
otherwise dispose of all or any part of the remaining Trust property
or Trust property allocated or belonging to such Series or Class to
one or more persons at public or private sale for consideration that
may consist in whole or in part of cash, securities, or other property
of any kind; discharge or pay its liabilities; and do all other acts
appropriate to liquidate its business; provided that any sale,
conveyance, assignment, exchange, transfer, or other disposition of
all or substantially all the Trust property or Trust property
allocated or belonging to such Series or Class (other than as provided
in (iii) below) shall require Shareholder approval in accordance with
Section 4.3 below; and
(iii) after paying or adequately providing for the payment of all
liabilities, and upon receipt of such releases, indemnities, and
refunding agreements as they deem necessary for their protection, the
Trustees may distribute the remaining Trust property or the remaining
property of the terminated Series or Class, in cash or in kind or
partly each, among the Shareholders of the Trust or the Series or
Class according to their respective rights; and
(b) after termination of the Trust or the Series or Class and
distribution to the Shareholders as herein provided, a majority of the
Trustees shall execute and lodge among the records of the Trust and
file with the Secretary of The Commonwealth of Massachusetts, as
appropriate, an instrument in writing setting forth the fact of such
termination, and the Trustees shall thereupon be discharged from all
further liabilities and duties with respect to the Trust or the
terminated Series or Class, and the rights and interests of all
Shareholders of the Trust or the terminated Series or Class shall
thereupon cease.
SECTION 4.3. MERGER, CONSOLIDATION, AND SALE OF ASSETS. Subject to
applicable Federal and state law and except as otherwise provided in
Section 4.4 below, the Trust or any Series or Class thereof may merge
or consolidate with any other corporation, association, trust, or
other organization or may sell, lease, or exchange all or a portion of
the Trust property or Trust property allocated or belonging to such
Series or Class, including its good will, upon such terms and
conditions and for such consideration when and as authorized at any
meeting of Shareholders called for such purpose by a Majority
Shareholder Vote of the Trust or affected Series or Class, as the case
may be. Such transactions may be effected through share-for-share
exchanges, transfers or sale of assets, shareholder in-kind
redemptions and purchases, exchange offers, or any other method
approved by the Trustees.
SECTION 4.4. INCORPORATION; REORGANIZATION. Subject to applicable
Federal and state law, the Trustees may without the vote or consent of
Shareholders cause to be organized or assist in organizing a
corporation or corporations under the laws of any jurisdiction or any
other trust, partnership, limited liability company, association, or
other organization to take over all or a portion of the Trust property
or all or a portion of the Trust property allocated or belonging to
such Series or Class or to carry on any business in which the Trust
shall directly or indirectly have any interest, and to sell, convey
and transfer the Trust property or the Trust property allocated or
belonging to such Series or Class to any such corporation, trust,
limited liability company, partnership, association, or organization
in exchange for the shares or securities thereof or otherwise, and to
lend money to, subscribe for the shares or securities of, and enter
into any contracts with any such corporation, trust, partnership,
limited liability company, association, or organization, or any
corporation, partnership, limited liability company, trust,
association, or organization in which the Trust or such Series holds
or is about to acquire shares or any other interest. Subject to
applicable Federal and state law, the Trustees may also cause a merger
or consolidation between the Trust or any successor thereto or any
Series or Class thereof and any such corporation, trust, partnership,
limited liability company, association, or other organization. Nothing
contained herein shall be construed as requiring approval of
Shareholders for the Trustees to organize or assist in organizing one
or more corporations, trusts, partnerships, limited liability
companies, associations, or other organizations and selling,
conveying, or transferring the Trust property or a portion of the
Trust property to such organization or entities; provided, however,
that the Trustees shall provide written notice to the affected
Shareholders of any transaction whereby, pursuant to this Section 4.4,
the Trust or any Series or Class thereof sells, conveys, or transfers
all or a portion of its assets to another entity or merges or
consolidates with another entity. Such transactions may be effected
through share-for-share exchanges, transfers or sale of assets,
shareholder in-kind redemptions and purchases, exchange offers, or any
other method approved by the Trustees.
FILING OF COPIES, REFERENCES, AND HEADINGS
SECTION 5. The original or a copy of this instrument and of each
Declaration of Trust supplemental hereto shall be kept at the office
of the Trust where it may be inspected by any Shareholder. A copy of
this instrument and of each supplemental Declaration of Trust shall be
filed by the Trustees with the Secretary of The Commonwealth of
Massachusetts and the Boston City Clerk, as well as any other
governmental office where such filing may from time to time be
required. Anyone dealing with the Trust may rely on a certificate by
an officer or Trustee of the Trust as to whether or not any such
supplemental Declarations of Trust have been made and as to any
matters in connection with the Trust hereunder, and with the same
effect as if it were the original, may rely on a copy certified by an
officer or Trustee of the Trust to be a copy of this instrument or of
any such supplemental Declaration of Trust. In this instrument or in
any such supplemental Declaration of Trust, references to this
instrument and all expressions like "herein," "hereof" and
"hereunder," shall be deemed to refer to this instrument as amended or
affected by any such supplemental Declaration of Trust. Headings are
placed herein for convenience of reference only and in case of any
conflict, the text of this instrument, rather than the headings, shall
control. This instrument may be executed in any number of counterparts
each of which shall be deemed an original.
APPLICABLE LAW
SECTION 6. The Trust set forth in this instrument is made in The
Commonwealth of Massachusetts, and it is created under and is to be
governed by and construed and administered according to the laws of
said Commonwealth. The Trust shall be of the type commonly called a
Massachusetts business trust, and without limiting the provisions
hereof, the Trust may exercise all powers which are ordinarily
exercised by such a trust, and the absence of a specific reference
herein to any such power, privilege, or action shall not imply that
the Trust may not exercise such power or privilege or take such
actions.
AMENDMENTS
Section 7. Except as specifically provided herein, the Trustees may,
without shareholder vote, amend or otherwise supplement this
Declaration of Trust by making an amendment, a Declaration of Trust
supplemental hereto or an amended and restated Declaration of Trust.
Shareholders shall have the right to vote (a) on any amendment that
would affect their right to vote granted in Section 1 of Article VIII;
(b) on any amendment that would alter the maximum number of Trustees
permitted under Section 6 of Article IV; (c) on any amendment to this
Section 7; (d) on any amendment as may be required by law or by the
Trust's registration statement filed with the Commission; and (e) on
any amendment submitted to them by the Trustees. Any amendment
required or permitted to be submitted to Shareholders that, as the
Trustees determine, shall affect the Shareholders of one or more
Series or Classes shall be authorized by vote of the Shareholders of
each Series or Class affected and no vote of shareholders of a Series
or Class not affected shall be required. Notwithstanding anything else
herein, any amendment to Article XI shall not limit the rights to
indemnification or insurance provided therein with respect to action
or omission of Covered Persons prior to such amendment.
FISCAL YEAR
SECTION 8. The fiscal year of the Trust shall end on a specified date
as set forth in the Bylaws, if any, provided, however, that the
Trustees may, without Shareholder approval, change the fiscal year of
the Trust.
USE OF THE WORD "FIDELITY"
SECTION 9. Fidelity Management & Research Company ("FMR") has
consented to the use by any Series of the Trust of the identifying
word "Fidelity" in the name of any Series of the Trust at some future
date. Such consent is conditioned upon the employment of FMR or a
subsidiary or affiliate thereof as investment adviser of each Series
of the Trust. As between the Trust and itself, FMR controls the use of
the name of the Trust insofar as such name contains the identifying
word "Fidelity." FMR may from time to time use the identifying word
"Fidelity" in other connections and for other purposes, including,
without limitation, in the names of other investment companies,
corporations, or businesses that it may manage, advise, sponsor or own
or in which it may have a financial interest. FMR may require the
Trust or any Series thereof to cease using the identifying word
"Fidelity" in the name of the Trust or any Series thereof if the Trust
or any Series thereof ceases to employ FMR or a subsidiary or
affiliate thereof as investment adviser.
PROVISIONS IN CONFLICT WITH LAW OR REGULATIONS
SECTION 10. (a) The provisions of this Declaration of Trust are
severable, and, if the Trustees shall determine, with the advice of
counsel, that any of such provisions is in conflict with the 1940 Act,
the regulated investment company provisions of the Internal Revenue
Code or with other applicable laws and regulations, the conflicting
provision shall be deemed never to have constituted a part of this
Declaration of Trust; provided, however, that such determination shall
not affect any of the remaining provisions of this Declaration of
Trust or render invalid or improper any action taken or omitted prior
to such determination.
(b) If any provision of this Declaration Trust shall be held invalid
or unenforceable in any jurisdiction, such invalidity or
unenforceability shall attach only to such provision in such
jurisdiction and shall not in any manner affect such provisions in any
other jurisdiction or any other provision of this Declaration of Trust
in any jurisdiction.
IN WITNESS WHEREOF, the undersigned, being all of the Trustees of the
Trust, have executed this instrument as of the date set forth above.
/s/Edward C. Johnson 3d /s/Peter S. Lynch
Edward C. Johnson 3d* Peter S. Lynch*
/s/Ralph F. Cox /s/William O. McCoy
Ralph F. Cox William O. McCoy
/s/Phyllis Burke Davis /s/Gerald C. McDonough
Phyllis Burke Davis Gerald C. McDonough
/s/Robert M. Gates /s/Marvin L. Mann
Robert M. Gates Marvin L. Mann
/s/Donald J. Kirk /s/Robert C. Pozen
Donald J. Kirk Robert C. Pozen*
/s/Ned C. Lautenbach /s/Thomas R. Williams
Ned C. Lautenbach Thomas R. Williams
*Interested Trustees
The business addresses of the
members of the Board of
Trustees are: INTERESTED
TRUSTEES (*): 82 Devonshire
Street Boston, MA 02109
NON-INTERESTED TRUSTEES: 82
Devonshire Street Boston,
MA 02109 Mailing Address:
P.O. Box 9235 Boston, MA
02205-9235 FIDELITY
MAGELLAN FUND; 82 Devonshire
Street Boston, MA 02109
EXHIBIT D(1)
MANAGEMENT CONTRACT
BETWEEN
FIDELITY MAGELLAN FUND
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
AGREEMENT AMENDED and RESTATED as of this 1st day of May 2000, by and
between Fidelity Magellan Fund, a Massachusetts business trust which
may issue one or more series of shares of beneficial interest
(hereinafter called the "Fund"), on behalf of its single existing
series of shares of beneficial interest (hereinafter called the
"Portfolio"), and Fidelity Management & Research Company, a
Massachusetts corporation (hereinafter called the "Adviser") as set
forth in its entirety below.
Required authorization and approval by shareholders and Trustees
having been obtained, the Fund, on behalf of the Portfolio, and the
Adviser hereby consent, pursuant to Paragraph 6 of the existing
Management Contract dated April 1, 1994, to a modification of said
Contract in the manner set forth below. The Amended Management
Contract shall, when executed by duly authorized officers of the Fund
and Adviser, take effect on May 1, 2000 or the first day of the month
following approval.
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the
supervision of the Fund's Board of Trustees, direct the investments of
the Portfolio in accordance with the investment objective, policies
and limitations as provided in the Portfolio's Prospectus or other
governing instruments, as amended from time to time, the Investment
Company Act of 1940 and rules thereunder, as amended from time to time
(the "1940 Act"), and such other limitations as the Portfolio may
impose by notice in writing to the Adviser. The Adviser shall also
furnish for the use of the Portfolio office space and all necessary
office facilities, equipment and personnel for servicing the
investments of the Portfolio; and shall pay the salaries and fees of
all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all
personnel of the Fund or the Adviser performing services relating to
research, statistical and investment activities. The Adviser is
authorized, in its discretion and without prior consultation with the
Portfolio, to buy, sell, lend and otherwise trade in any stocks, bonds
and other securities and investment instruments on behalf of the
Portfolio. The investment policies and all other actions of the
Portfolio are and shall at all times be subject to the control and
direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for
the performance by its affiliates of) the management and
administrative services necessary for the operation of the Fund. The
Adviser shall, subject to the supervision of the Board of Trustees,
perform various services for the Portfolio, including but not limited
to: (i) providing the Portfolio with office space, equipment and
facilities (which may be its own) for maintaining its organization;
(ii) on behalf of the Portfolio, supervising relations with, and
monitoring the performance of, custodians, depositories, transfer and
pricing agents, accountants, attorneys, underwriters, brokers and
dealers, insurers and other persons in any capacity deemed to be
necessary or desirable; (iii) preparing all general shareholder
communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered,
maintaining the registration and qualification of the Portfolio's
shares under federal and state law; and (vii) investigating the
development of and developing and implementing, if appropriate,
management and shareholder services designed to enhance the value or
convenience of the Portfolio as an investment vehicle.
The Adviser shall also furnish such reports, evaluations, information
or analyses to the Fund as the Fund's Board of Trustees may request
from time to time or as the Adviser may deem to be desirable. The
Adviser shall make recommendations to the Fund's Board of Trustees
with respect to Fund policies, and shall carry out such policies as
are adopted by the Trustees. The Adviser shall, subject to review by
the Board of Trustees, furnish such other services as the Adviser
shall from time to time determine to be necessary or useful to perform
its obligations under this Contract.
(c) The Adviser shall place all orders for the purchase and sale of
portfolio securities for the Portfolio's account with brokers or
dealers selected by the Adviser, which may include brokers or dealers
affiliated with the Adviser. The Adviser shall use its best efforts to
seek to execute portfolio transactions at prices which are
advantageous to the Portfolio and at commission rates which are
reasonable in relation to the benefits received. In selecting brokers
or dealers qualified to execute a particular transaction, brokers or
dealers may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Portfolio and/or the other
accounts over which the Adviser or its affiliates exercise investment
discretion. The Adviser is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Adviser determines in
good faith that such amount of commission is reasonable in relation to
the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Adviser and its affiliates have with respect to accounts over which
they exercise investment discretion. The Trustees of the Fund shall
periodically review the commissions paid by the Portfolio to determine
if the commissions paid over representative periods of time were
reasonable in relation to the benefits to the Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor.
The Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of
the Fund are or may be or become interested in the Adviser as
directors, officers or otherwise and that directors, officers and
stockholders of the Adviser are or may be or become similarly
interested in the Fund, and that the Adviser may be or become
interested in the Fund as a shareholder or otherwise.
3. The Adviser will be compensated on the following basis for the
services and facilities to be furnished hereunder. The Adviser shall
receive a monthly management fee, payable monthly as soon as
practicable after the last day of each month, composed of a Basic Fee
and a Performance Adjustment. The Performance Adjustment is added to
or subtracted from the Basic Fee depending on whether the Portfolio
experienced better or worse performance than the Standard and Poor's
500 Index (the "Index"). The Performance Adjustment is not cumulative.
An increased fee will result even though the performance of the
Portfolio over some period of time shorter than the performance period
has been behind that of the Index, and, conversely, a reduction in the
fee will be made for a month even though the performance of the
Portfolio over some period of time shorter than the performance period
has been ahead of that of the Index. The Basic Fee and the Performance
Adjustment will be computed as follows:
(a) Basic Fee Rate: The annual Basic Fee Rate shall be the sum of
the Group Fee Rate and the Individual Fund Fee Rate calculated to the
nearest millionth decimal place as follows:
(i) Group Fee Rate. The Group Fee Rate shall be based upon the
monthly average of the net assets of the registered investment
companies having Advisory and Service or Management Contracts with the
Adviser (computed in the manner set forth in the Fund's Declaration of
Trust or other organizational document) determined as of the close of
business on each business day throughout the month. The Group Fee Rate
shall be determined on a cumulative basis pursuant to the following
schedule:
Average Net Assets Annualized Fee Rate (for each
level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
534 - 587 .2500
587 - 646 .2463
646 - 711 .2426
711 - 782 .2389
782 - 860 .2352
860 - 946 .2315
946 - 1,041 .2278
1,041 - 1,145 .2241
1,145 - 1,260 .2204
Over 1,260 .2167
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall
be 0.30%.
(b) Basic Fee. One-twelfth of the Basic Fee Rate shall be applied to
the average of the net assets of the Portfolio (computed in the manner
set forth in the Fund's Declaration of Trust or other organizational
document) determined as of the close of business on each business day
throughout the month. The resulting dollar amount comprises the Basic
Fee.
(c) Performance Adjustment Rate: The Performance Adjustment Rate is
0.02% for each percentage point (the performance of the Portfolio and
the Index each being calculated to the nearest .01%) that the
Portfolio's investment performance for the performance period was
better or worse than the record of the Index as then constituted. The
maximum performance adjustment rate is 0.20%.
The performance period will commence with the first day of the first
full month following the Portfolio's commencement of operations.
During the first eleven months of the performance period for the
Portfolio, there will be no performance adjustment. Starting with the
twelfth month of the performance period, the performance adjustment
will take effect. Following the twelfth month a new month will be
added to the performance period until the performance period equals 36
months. Thereafter the performance period will consist of the current
month plus the previous 35 months.
The Portfolio's investment performance will be measured by comparing
(i) the opening net asset value of one share of the Portfolio on the
first business day of the performance period with (ii) the closing net
asset value of one share of the Portfolio as of the last business day
of such period. In computing the investment performance of the
Portfolio and the investment record of the Index, distributions of
realized capital gains, the value of capital gains taxes per share
paid or payable on undistributed realized long-term capital gains
accumulated to the end of such period and dividends paid out of
investment income on the part of the Portfolio, and all cash
distributions of the securities included in the Index, will be treated
as reinvested in accordance with Rule 205-1 or any other applicable
rules under the Investment Advisers Act of 1940, as the same from time
to time may be amended.
(d) Performance Adjustment. One-twelfth of the annual Performance
Adjustment Rate will be applied to the average of the net assets of
the Portfolio (computed in the manner set forth in the Fund's
Declaration of Trust or other organizational document) determined as
of the close of business on each business day throughout the month and
the performance period.
(e) In case of termination of this Contract during any month, the
fee for that month shall be reduced proportionately on the basis of
the number of business days during which it is in effect for that
month. The Basic Fee Rate will be computed on the basis of and applied
to net assets averaged over that month ending on the last business day
on which this Contract is in effect. The amount of this Performance
Adjustment to the Basic Fee will be computed on the basis of and
applied to net assets averaged over the 36-month period ending on the
last business day on which this Contract is in effect provided that if
this Contract has been in effect less than 36 months, the computation
will be made on the basis of the period of time during which it has
been in effect.
4. It is understood that the Portfolio will pay all its expenses,
which expenses payable by the Portfolio shall include, without
limitation, (i) interest and taxes; (ii) brokerage commissions and
other costs in connection with the purchase or sale of securities and
other investment instruments; (iii) fees and expenses of the Fund's
Trustees other than those who are "interested persons" of the Fund or
the Adviser; (iv) legal and audit expenses; (v) custodian, registrar
and transfer agent fees and expenses; (vi) fees and expenses related
to the registration and qualification of the Fund and the Portfolio's
shares for distribution under state and federal securities laws; (vii)
expenses of printing and mailing reports and notices and proxy
material to shareholders of the Portfolio; (viii) all other expenses
incidental to holding meetings of the Portfolio's shareholders,
including proxy solicitations therefor; (ix) a pro rata share, based
on relative net assets of the Portfolio and other registered
investment companies having Advisory and Service or Management
Contracts with the Adviser, of 50% of insurance premiums for fidelity
and other coverage; (x) its proportionate share of association
membership dues; (xi) expenses of typesetting for printing
Prospectuses and Statements of Additional Information and supplements
thereto; (xii) expenses of printing and mailing Prospectuses and
Statements of Additional Information and supplements thereto sent to
existing shareholders; and (xiii) such non-recurring or extraordinary
expenses as may arise, including those relating to actions, suits or
proceedings to which the Portfolio is a party and the legal obligation
which the Portfolio may have to indemnify the Fund's Trustees and
officers with respect thereto.
5. The services of the Adviser to the Portfolio are not to be deemed
exclusive, the Adviser being free to render services to others and
engage in other activities, provided, however, that such other
services and activities do not, during the term of this Contract,
interfere, in a material manner, with the Adviser's ability to meet
all of its obligations with respect to rendering services to the
Portfolio hereunder. In the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Adviser, the Adviser shall not be subject
to liability to the Portfolio or to any shareholder of the Portfolio
for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the
purchase, holding or sale of any security or other investment
instrument.
6. (a) Subject to prior termination as provided in sub-paragraph (d)
of this paragraph 6, this Contract shall continue in force until July
31, 2000 and indefinitely thereafter, but only so long as the
continuance after such date shall be specifically approved at least
annually by vote of the Trustees of the Fund or by vote of a majority
of the outstanding voting securities of the Portfolio.
(b) This Contract may be modified by mutual consent subject to the
provisions of Section 15 of the 1940 Act, as modified by or
interpreted by any applicable order or orders of the Securities and
Exchange Commission (the "Commission") or any rules regulations
adopted by, or interpretative releases of, the Commission.
(c) In addition to the requirements of sub-paragraphs (a) and (b) of
this paragraph 6, the terms of any continuance or modification of this
Contract must have been approved by the vote of a majority of those
Trustees of the Fund who are not parties to the Contract or interested
persons of any such party, cast in person at a meeting called for the
purpose of voting on such approval.
(d) Either party hereto may, at any time on sixty (60) days' prior
written notice to the other, terminate this Contract, without payment
of any penalty, by action of its Trustees or Board of Directors, as
the case may be, or with respect to the Portfolio by vote of a
majority of the outstanding voting securities of the Portfolio. This
Contract shall terminate automatically in the event of its assignment.
7. The Adviser is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Fund's Declaration of Trust
or other organizational document and agrees that the obligations
assumed by the Fund pursuant to this Contract shall be limited in all
cases to the Portfolio and its assets, and the Adviser shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio or any other Portfolios of the Fund. In
addition, the Adviser shall not seek satisfaction of any such
obligations from the Trustees or any individual Trustee. The Adviser
understands that the rights and obligations of any Portfolio under the
Declaration of Trust or other organizational document are separate and
distinct from those of any and all other Portfolios.
8. This Agreement shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Massachusetts, without giving
effect to the choice of laws provisions thereof.
The terms "vote of a majority of the outstanding voting securities,"
"assignment," and "interested persons," when used herein, shall have
the respective meanings specified in the 1940 Act, as now in effect or
as hereafter amended, and subject to such orders as may be granted by
the Commission.
IN WITNESS WHEREOF the parties have caused this instrument to be
signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
FIDELITY MAGELLAN FUND
on behalf of Fidelity Magellan Fund
By /s/Robert C. Pozen
Robert C. Pozen
Senior Vice President
FIDELITY MANAGEMENT & RESEARCH COMPANY
By /s/Robert C. Pozen
Robert C. Pozen
President
EXHIBIT D(2)
SUB-ADVISORY AGREEMENT
BETWEEN
FIDELITY MANAGEMENT & RESEARCH COMPANY
AND
FIDELITY MANAGEMENT & RESEARCH (FAR EAST) INC.
AND
FIDELITY MAGELLAN FUND ON BEHALF OF FIDELITY MAGELLAN FUND
AMENDMENT made this 1st day of May 2000, by and between Fidelity
Management & Research Company, a Massachusetts corporation with
principal offices at 82 Devonshire Street, Boston, Massachusetts
(hereinafter called the "Advisor"); Fidelity Management & Research
(Far East) Inc. (hereinafter called the "Sub-Advisor"); and Fidelity
Magellan Fund, a Massachusetts business trust which may issue one or
more series of shares of beneficial interest (hereinafter called the
"Trust") on behalf of Fidelity Magellan Fund (hereinafter called the
"Portfolio").
Required authorization and approval by shareholders and Trustees
having been obtained, the Fund, on behalf of the Portfolio, the
Advisor and the Sub-Advisor hereby consent, pursuant to Paragraph 9 of
the existing Sub-Advisory Agreement dated April 1, 1994, to a
modification of said Agreement in the manner set forth below. The
Amended Sub-Advisory Agreement shall, when executed by duly authorized
officers of the Fund, the Advisor and the Sub-Advisor, take effect on
May 1, 2000.
WHEREAS the Trust and the Advisor have entered into a Management
Contract on behalf of the Portfolio, pursuant to which the Advisor is
to act as investment manager of the Portfolio; and
WHEREAS the Sub-Advisor and its subsidiaries and other affiliated
persons have personnel in various locations throughout the world and
have been formed in part for the purpose of researching and compiling
information and recommendations with respect to the economies of
various countries, and securities of issuers located in such
countries, and providing investment advisory services in connection
therewith;
NOW, THEREFORE, in consideration of the premises and the mutual
promises hereinafter set forth, the Trust, the Advisor and the
Sub-Advisor agree as follows:
1. Duties: The Advisor may, in its discretion, appoint the
Sub-Advisor to perform one or more of the following services with
respect to all or a portion of the investments of the Portfolio. The
services and the portion of the investments of the Portfolio to be
advised or managed by the Sub-Advisor shall be as agreed upon from
time to time by the Advisor and the Sub-Advisor. The Sub-Advisor shall
pay the salaries and fees of all personnel of the Sub-Advisor
performing services for the Portfolio relating to research,
statistical and investment activities.
(a) INVESTMENT ADVICE: If and to the extent requested by the
Advisor, the Sub-Advisor shall provide investment advice to the
Portfolio and the Advisor with respect to all or a portion of the
investments of the Portfolio, and in connection with such advice shall
furnish the Portfolio and the Advisor such factual information,
research reports and investment recommendations as the Advisor may
reasonably require. Such information may include written and oral
reports and analyses.
(b) INVESTMENT MANAGEMENT: If and to the extent requested by the
Advisor, the Sub-Advisor shall, subject to the supervision of the
Advisor, manage all or a portion of the investments of the Portfolio
in accordance with the investment objective, policies and limitations
provided in the Portfolio's Prospectus or other governing instruments,
as amended from time to time, the Investment Company Act of 1940 (the
"1940 Act") and rules thereunder, as amended from time to time, and
such other limitations as the Trust or Advisor may impose with respect
to the Portfolio by notice to the Sub-Advisor. With respect to the
portion of the investments of the Portfolio under its management, the
Sub-Advisor is authorized to make investment decisions on behalf of
the Portfolio with regard to any stock, bond, other security or
investment instrument, and to place orders for the purchase and sale
of such securities through such broker-dealers as the Sub-Advisor may
select. The Sub-Advisor may also be authorized, but only to the extent
such duties are delegated in writing by the Advisor, to provide
additional investment management services to the Portfolio, including
but not limited to services such as managing foreign currency
investments, purchasing and selling or writing futures and options
contracts, borrowing money, or lending securities on behalf of the
Portfolio. All investment management and any other activities of the
Sub-Advisor shall at all times be subject to the control and direction
of the Advisor and the Trust's Board of Trustees.
(c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or
all of the services contemplated by this Agreement directly or through
such of its subsidiaries or other affiliated persons as the
Sub-Advisor shall determine; provided, however, that performance of
such services through such subsidiaries or other affiliated persons
shall have been approved by the Trust to the extent required pursuant
to the 1940 Act and rules thereunder.
2. Information to be Provided to the Trust and the Advisor: The
Sub-Advisor shall furnish such reports, evaluations, information or
analyses to the Trust and the Advisor as the Trust's Board of Trustees
or the Advisor may reasonably request from time to time, or as the
Sub-Advisor may deem to be desirable.
3. Brokerage: In connection with the services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Sub-Advisor
shall place all orders for the purchase and sale of portfolio
securities for the Portfolio's account with brokers or dealers
selected by the Sub-Advisor, which may include brokers or dealers
affiliated with the Advisor or Sub-Advisor. The Sub-Advisor shall use
its best efforts to seek to execute portfolio transactions at prices
which are advantageous to the Portfolio and at commission rates which
are reasonable in relation to the benefits received. In selecting
brokers or dealers qualified to execute a particular transaction,
brokers or dealers may be selected who also provide brokerage and
research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Portfolio and/or to the other
accounts over which the Sub-Advisor or Advisor exercise investment
discretion. The Sub-Advisor is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Sub-Advisor determines
in good faith that such amount of commission is reasonable in relation
to the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Sub-Advisor has with respect to accounts over which it exercises
investment discretion. The Trustees of the Trust shall periodically
review the commissions paid by the Portfolio to determine if the
commissions paid over representative periods of time were reasonable
in relation to the benefits to the Portfolio.
4. Compensation: The Advisor shall compensate the Sub-Advisor on the
following basis for the services to be furnished hereunder.
(a) INVESTMENT ADVISORY FEE: For services provided under
subparagraph (a) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory
Fee shall be equal to 105% of the Sub-Advisor's costs incurred in
connection with rendering the services referred to in subparagraph (a)
of paragraph 1 of this Agreement. The Sub-Advisory Fee shall not be
reduced to reflect expense reimbursements or fee waivers by the
Advisor, if any, in effect from time to time.
(b) INVESTMENT MANAGEMENT FEE: For services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Investment Management Fee. The
Investment Management Fee shall be equal to: (i) 50% of the monthly
management fee rate (including performance adjustments, if any) that
the Portfolio is obligated to pay the Advisor under its Management
Contract with the Advisor, multiplied by: (ii) the fraction equal to
the net assets of the Portfolio as to which the Sub-Advisor shall have
provided investment management services divided by the net assets of
the Portfolio for that month. If in any fiscal year the aggregate
expenses of the Portfolio exceed any applicable expense limitation
imposed by any state or federal securities laws or regulations, and
the Advisor waives all or a portion of its management fee or
reimburses the Portfolio for expenses to the extent required to
satisfy such limitation, the Investment Management Fee paid to the
Sub-Advisor will be reduced by 50% of the amount of such waivers or
reimbursements multiplied by the fraction determined in (ii). If the
Sub-Advisor reduces its fees to reflect such waivers or reimbursements
and the Advisor subsequently recovers all or any portion of such
waivers and reimbursements, then the Sub-Advisor shall be entitled to
receive from the Advisor a proportionate share of the amount
recovered. To the extent that waivers and reimbursements by the
Advisor required by such limitations are in excess of the Advisor's
management fee, the Investment Management Fee paid to the Sub-Advisor
will be reduced to zero for that month, but in no event shall the
Sub-Advisor be required to reimburse the Advisor for all or a portion
of such excess reimbursements.
(c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have
provided both investment advisory services under subparagraph (a) and
investment management services under subparagraph (b) of paragraph 1
for the same portion of the investments of the Portfolio for the same
period, the fees paid to the Sub-Advisor with respect to such
investments shall be calculated exclusively under subparagraph (b) of
this paragraph 4.
5. Expenses: It is understood that the Portfolio will pay all of its
expenses other than those expressly stated to be payable by the
Sub-Advisor hereunder or by the Advisor under the Management Contract
with the Portfolio, which expenses payable by the Portfolio shall
include, without limitation, (i) interest and taxes; (ii) brokerage
commissions and other costs in connection with the purchase or sale of
securities and other investment instruments; (iii) fees and expenses
of the Trust's Trustees other than those who are "interested persons"
of the Trust, the Sub-Advisor or the Advisor; (iv) legal and audit
expenses; (v) custodian, registrar and transfer agent fees and
expenses; (vi) fees and expenses related to the registration and
qualification of the Trust and the Portfolio's shares for distribution
under state and federal securities laws; (vii) expenses of printing
and mailing reports and notices and proxy material to shareholders of
the Portfolio; (viii) all other expenses incidental to holding
meetings of the Portfolio's shareholders, including proxy
solicitations therefore; (ix) a pro rata share, based on relative net
assets of the Portfolio and other registered investment companies
having Advisory and Service or Management Contracts with the Advisor,
of 50% of insurance premiums for fidelity and other coverage; (x) its
proportionate share of association membership dues; (xi) expenses of
typesetting for printing Prospectuses and Statements of Additional
Information and supplements thereto; (xii) expenses of printing and
mailing Prospectuses and Statements of Additional Information and
supplements thereto sent to existing shareholders; and (xiii) such
non-recurring or extraordinary expenses as may arise, including those
relating to actions, suits or proceedings to which the Portfolio is a
party and the legal obligation which the Portfolio may have to
indemnify the Trust's Trustees and officers with respect thereto.
6. Interested Persons: It is understood that Trustees, officers, and
shareholders of the Trust are or may be or become interested in the
Advisor or the Sub-Advisor as directors, officers or otherwise and
that directors, officers and stockholders of the Advisor or the
Sub-Advisor are or may be or become similarly interested in the Trust,
and that the Advisor or the Sub-Advisor may be or become interested in
the Trust as a shareholder or otherwise.
7. Services to Other Companies or Accounts: The services of the
Sub-Advisor to the Advisor are not to be deemed to be exclusive, the
Sub-Advisor being free to render services to others and engage in
other activities, provided, however, that such other services and
activities do not, during the term of this Agreement, interfere, in a
material manner, with the Sub-Advisor's ability to meet all of its
obligations hereunder. The Sub-Advisor shall for all purposes be an
independent contractor and not an agent or employee of the Advisor or
the Trust.
8. Standard of Care: In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be
subject to liability to the Advisor, the Trust or to any shareholder
of the Portfolio for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that
may be sustained in the purchase, holding or sale of any security.
9. Duration and Termination of Agreement; Amendments:
(a) Subject to prior termination as provided in subparagraph (d) of
this paragraph 9, this Agreement shall continue in force until July
31, 2000 and indefinitely thereafter, but only so long as the
continuance after such period shall be specifically approved at least
annually by vote of the Trust's Board of Trustees or by vote of a
majority of the outstanding voting securities of the Portfolio.
(b) This Agreement may be modified by mutual consent of the Advisor,
the Sub-Advisor and the Portfolio subject to the provisions of Section
15 of the 1940 Act, as modified by or interpreted by any applicable
order or orders of the Securities and Exchange Commission (the
"Commission") or any rules or regulations adopted by, or
interpretative releases of, the Commission.
(c) In addition to the requirements of subparagraphs (a) and (b) of
this paragraph 9, the terms of any continuance or modification of this
Agreement must have been approved by the vote of a majority of those
Trustees of the Trust who are not parties to this Agreement or
interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval.
(d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any
time on sixty (60) days' prior written notice to the other parties,
terminate this Agreement, without payment of any penalty, by action of
its Board of Trustees or Directors, or with respect to the Portfolio
by vote of a majority of its outstanding voting securities. This
Agreement shall terminate automatically in the event of its
assignment.
10. Limitation of Liability: The Sub-Advisor is hereby expressly put
on notice of the limitation of shareholder liability as set forth in
the Declaration of Trust or other organizational document of the Trust
and agrees that any obligations of the Trust or the Portfolio arising
in connection with this Agreement shall be limited in all cases to the
Portfolio and its assets, and the Sub-Advisor shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio. Nor shall the Sub-Advisor seek
satisfaction of any such obligation from the Trustees or any
individual Trustee.
11. Governing Law: This Agreement shall be governed by, and
construed in accordance with, the laws of the Commonwealth of
Massachusetts, without giving effect to the choice of laws provisions
thereof.
The terms "registered investment company," "vote of a majority of the
outstanding voting securities," "assignment," and "interested
persons," when used herein, shall have the respective meanings
specified in the 1940 Act as now in effect or as hereafter amended.
IN WITNESS WHEREOF the parties hereto have caused this instrument to
be signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
FIDELITY MANAGEMENT & RESEARCH (FAR EAST) INC.
BY: /s/Brian A. Clancy
Brian A. Clancy
Treasurer
FIDELITY MANAGEMENT & RESEARCH COMPANY
BY: /s/Robert C. Pozen
Robert C. Pozen
President
FIDELITY MAGELLAN FUND ON BEHALF OF
FIDELITY MAGELLAN FUND
BY: /s/Robert C. Pozen
Robert C. Pozen
Senior Vice President
EXHIBIT D(3)
SUB-ADVISORY AGREEMENT
BETWEEN
FIDELITY MANAGEMENT & RESEARCH COMPANY
AND
FIDELITY MANAGEMENT & RESEARCH (U.K.) INC.
AND
FIDELITY MAGELLAN FUND ON BEHALF OF FIDELITY MAGELLAN FUND
AMENDMENT made this 1st day of May 2000, by and between Fidelity
Management & Research Company, a Massachusetts corporation with
principal offices at 82 Devonshire Street, Boston, Massachusetts
(hereinafter called the "Advisor"); Fidelity Management & Research
(U.K.) Inc. (hereinafter called the "Sub-Advisor"); and Fidelity
Magellan Fund, a Massachusetts business trust which may issue one or
more series of shares of beneficial interest (hereinafter called the
"Trust") on behalf of Fidelity Magellan Fund (hereinafter called the
"Portfolio").
Required authorization and approval by shareholders and Trustees
having been obtained, the Fund, on behalf of the Portfolio, the
Advisor and the Sub-Advisor hereby consent, pursuant to Paragraph 9 of
the existing Sub-Advisory Agreement dated April 1, 1994, to a
modification of said Agreement in the manner set forth below. The
Amended Sub-Advisory Agreement shall, when executed by duly authorized
officers of the Fund, the Advisor and the Sub-Advisor, take effect on
May 1, 2000.
WHEREAS the Trust and the Advisor have entered into a Management
Contract on behalf of the Portfolio, pursuant to which the Advisor is
to act as investment manager of the Portfolio; and
WHEREAS the Sub-Advisor and its subsidiaries and other affiliated
persons have personnel in various locations throughout the world and
have been formed in part for the purpose of researching and compiling
information and recommendations with respect to the economies of
various countries, and securities of issuers located in such
countries, and providing investment advisory services in connection
therewith;
NOW, THEREFORE, in consideration of the premises and the mutual
promises hereinafter set forth, the Trust, the Advisor and the
Sub-Advisor agree as follows:
1. Duties: The Advisor may, in its discretion, appoint the
Sub-Advisor to perform one or more of the following services with
respect to all or a portion of the investments of the Portfolio. The
services and the portion of the investments of the Portfolio to be
advised or managed by the Sub-Advisor shall be as agreed upon from
time to time by the Advisor and the Sub-Advisor. The Sub-Advisor shall
pay the salaries and fees of all personnel of the Sub-Advisor
performing services for the Portfolio relating to research,
statistical and investment activities.
(a) INVESTMENT ADVICE: If and to the extent requested by the
Advisor, the Sub-Advisor shall provide investment advice to the
Portfolio and the Advisor with respect to all or a portion of the
investments of the Portfolio, and in connection with such advice shall
furnish the Portfolio and the Advisor such factual information,
research reports and investment recommendations as the Advisor may
reasonably require. Such information may include written and oral
reports and analyses.
(b) INVESTMENT MANAGEMENT: If and to the extent requested by the
Advisor, the Sub-Advisor shall, subject to the supervision of the
Advisor, manage all or a portion of the investments of the Portfolio
in accordance with the investment objective, policies and limitations
provided in the Portfolio's Prospectus or other governing instruments,
as amended from time to time, the Investment Company Act of 1940 (the
"1940 Act") and rules thereunder, as amended from time to time, and
such other limitations as the Trust or Advisor may impose with respect
to the Portfolio by notice to the Sub-Advisor. With respect to the
portion of the investments of the Portfolio under its management, the
Sub-Advisor is authorized to make investment decisions on behalf of
the Portfolio with regard to any stock, bond, other security or
investment instrument, and to place orders for the purchase and sale
of such securities through such broker-dealers as the Sub-Advisor may
select. The Sub-Advisor may also be authorized, but only to the extent
such duties are delegated in writing by the Advisor, to provide
additional investment management services to the Portfolio, including
but not limited to services such as managing foreign currency
investments, purchasing and selling or writing futures and options
contracts, borrowing money or lending securities on behalf of the
Portfolio. All investment management and any other activities of the
Sub-Advisor shall at all times be subject to the control and direction
of the Advisor and the Trust's Board of Trustees.
(c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or
all of the services contemplated by this Agreement directly or through
such of its subsidiaries or other affiliated persons as the
Sub-Advisor shall determine; provided, however, that performance of
such services through such subsidiaries or other affiliated persons
shall have been approved by the Trust to the extent required pursuant
to the 1940 Act and rules thereunder.
2. Information to be Provided to the Trust and the Advisor: The
Sub-Advisor shall furnish such reports, evaluations, information or
analyses to the Trust and the Advisor as the Trust's Board of Trustees
or the Advisor may reasonably request from time to time, or as the
Sub-Advisor may deem to be desirable.
3. Brokerage: In connection with the services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Sub-Advisor
shall place all orders for the purchase and sale of portfolio
securities for the Portfolio's account with brokers or dealers
selected by the Sub-Advisor, which may include brokers or dealers
affiliated with the Advisor or Sub-Advisor. The Sub-Advisor shall use
its best efforts to seek to execute portfolio transactions at prices
which are advantageous to the Portfolio and at commission rates which
are reasonable in relation to the benefits received. In selecting
brokers or dealers qualified to execute a particular transaction,
brokers or dealers may be selected who also provide brokerage and
research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Portfolio and/or to the other
accounts over which the Sub-Advisor or Advisor exercise investment
discretion. The Sub-Advisor is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Sub-Advisor determines
in good faith that such amount of commission is reasonable in relation
to the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Sub-Advisor has with respect to accounts over which it exercises
investment discretion. The Trustees of the Trust shall periodically
review the commissions paid by the Portfolio to determine if the
commissions paid over representative periods of time were reasonable
in relation to the benefits to the Portfolio.
4. Compensation: The Advisor shall compensate the Sub-Advisor on the
following basis for the services to be furnished hereunder.
(a) INVESTMENT ADVISORY FEE: For services provided under
subparagraph (a) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory
Fee shall be equal to 110% of the Sub-Advisor's costs incurred in
connection with rendering the services referred to in subparagraph (a)
of paragraph 1 of this Agreement. The Sub-Advisory Fee shall not be
reduced to reflect expense reimbursements or fee waivers by the
Advisor, if any, in effect from time to time.
(b) INVESTMENT MANAGEMENT FEE: For services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Investment Management Fee. The
Investment Management Fee shall be equal to: (i) 50% of the monthly
management fee rate (including performance adjustments, if any) that
the Portfolio is obligated to pay the Advisor under its Management
Contract with the Advisor, multiplied by: (ii) the fraction equal to
the net assets of the Portfolio as to which the Sub-Advisor shall have
provided investment management services divided by the net assets of
the Portfolio for that month. If in any fiscal year the aggregate
expenses of the Portfolio exceed any applicable expense limitation
imposed by any state or federal securities laws or regulations, and
the Advisor waives all or a portion of its management fee or
reimburses the Portfolio for expenses to the extent required to
satisfy such limitation, the Investment Management Fee paid to the
Sub-Advisor will be reduced by 50% of the amount of such waivers or
reimbursements multiplied by the fraction determined in (ii). If the
Sub-Advisor reduces its fees to reflect such waivers or reimbursements
and the Advisor subsequently recovers all or any portion of such
waivers or reimbursements, then the Sub-Advisor shall be entitled to
receive from the Advisor a proportionate share of the amount
recovered. To the extent that waivers and reimbursements by the
Advisor required by such limitations are in excess of the Advisor's
management fee, the Investment Management Fee paid to the Sub-Advisor
will be reduced to zero for that month, but in no event shall the
Sub-Advisor be required to reimburse the Advisor for all or a portion
of such excess reimbursements.
(c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have
provided both investment advisory services under subparagraph (a) and
investment management services under subparagraph (b) of paragraph (1)
for the same portion of the investments of the Portfolio for the same
period, the fees paid to the Sub-Advisor with respect to such
investments shall be calculated exclusively under subparagraph (b) of
this paragraph 4.
5. Expenses: It is understood that the Portfolio will pay all of its
expenses other than those expressly stated to be payable by the
Sub-Advisor hereunder or by the Advisor under the Management Contract
with the Portfolio, which expenses payable by the Portfolio shall
include, without limitation, (i) interest and taxes; (ii) brokerage
commissions and other costs in connection with the purchase or sale of
securities and other investment instruments; (iii) fees and expenses
of the Trust's Trustees other than those who are "interested persons"
of the Trust, the Sub-Advisor or the Advisor; (iv) legal and audit
expenses; (v) custodian, registrar and transfer agent fees and
expenses; (vi) fees and expenses related to the registration and
qualification of the Trust and the Portfolio's shares for distribution
under state and federal securities laws; (vii) expenses of printing
and mailing reports and notices and proxy material to shareholders of
the Portfolio; (viii) all other expenses incidental to holding
meetings of the Portfolio's shareholders, including proxy
solicitations therefore; (ix) a pro rata share, based on relative net
assets of the Portfolio and other registered investment companies
having Advisory and Service or Management Contracts with the Advisor,
of 50% of insurance premiums for fidelity and other coverage; (x) its
proportionate share of association membership dues; (xi) expenses of
typesetting for printing Prospectuses and Statements of Additional
Information and supplements thereto; (xii) expenses of printing and
mailing Prospectuses and Statements of Additional Information and
supplements thereto sent to existing shareholders; and (xiii) such
non-recurring or extraordinary expenses as may arise, including those
relating to actions, suits or proceedings to which the Portfolio is a
party and the legal obligation which the Portfolio may have to
indemnify the Trust's Trustees and officers with respect thereto.
6. Interested Persons: It is understood that Trustees, officers, and
shareholders of the Trust are or may be or become interested in the
Advisor or the Sub-Advisor as directors, officers or otherwise and
that directors, officers and stockholders of the Advisor or the
Sub-Advisor are or may be or become similarly interested in the Trust,
and that the Advisor or the Sub-Advisor may be or become interested in
the Trust as a shareholder or otherwise.
7. Services to Other Companies or Accounts: The services of the
Sub-Advisor to the Advisor are not to be deemed to be exclusive, the
Sub-Advisor being free to render services to others and engage in
other activities, provided, however, that such other services and
activities do not, during the term of this Agreement, interfere, in a
material manner, with the Sub-Advisor's ability to meet all of its
obligations hereunder. The Sub-Advisor shall for all purposes be an
independent contractor and not an agent or employee of the Advisor or
the Trust.
8. Standard of Care: In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be
subject to liability to the Advisor, the Trust or to any shareholder
of the Portfolio for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that
may be sustained in the purchase, holding or sale of any security.
9. Duration and Termination of Agreement; Amendments:
(a) Subject to prior termination as provided in subparagraph (d) of
this paragraph 9, this Agreement shall continue in force until July
31, 2000 and indefinitely thereafter, but only so long as the
continuance after such period shall be specifically approved at least
annually by vote of the Trust's Board of Trustees or by vote of a
majority of the outstanding voting securities of the Portfolio.
(b) This Agreement may be modified by mutual consent of the Advisor,
the Sub-Advisor and the Portfolio subject to the provisions of Section
15 of the 1940 Act, as modified by or interpreted by any applicable
order or orders of the Securities and Exchange Commission (the
"Commission") or any rules or regulations adopted by, or
interpretative releases of, the Commission.
(c) In addition to the requirements of subparagraphs (a) and (b) of
this paragraph 9, the terms of any continuance or modification of this
Agreement must have been approved by the vote of a majority of those
Trustees of the Trust who are not parties to this Agreement or
interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval.
(d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any
time on sixty (60) days' prior written notice to the other parties,
terminate this Agreement, without payment of any penalty, by action of
its Board of Trustees or Directors, or with respect to the Portfolio
by vote of a majority of its outstanding voting securities. This
Agreement shall terminate automatically in the event of its
assignment.
10. Limitation of Liability: The Sub-Advisor is hereby expressly put
on notice of the limitation of shareholder liability as set forth in
the Declaration of Trust or other organizational document of the Trust
and agrees that any obligations of the Trust or the Portfolio arising
in connection with this Agreement shall be limited in all cases to the
Portfolio and its assets, and the Sub-Advisor shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio. Nor shall the Sub-Advisor seek
satisfaction of any such obligation from the Trustees or any
individual Trustee.
11. Governing Law: This Agreement shall be governed by, and construed
in accordance with, the laws of the Commonwealth of Massachusetts,
without giving effect to the choice of laws provisions thereof.
The terms "registered investment company," "vote of a majority of the
outstanding voting securities," "assignment," and "interested
persons," when used herein, shall have the respective meanings
specified in the 1940 Act as now in effect or as hereafter amended.
IN WITNESS WHEREOF the parties hereto have caused this instrument to
be signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
FIDELITY MANAGEMENT & RESEARCH (U.K.) INC.
BY: /s/Brian A. Clancy
Brian A. Clancy
Treasurer
FIDELITY MANAGEMENT & RESEARCH COMPANY
BY: /s/Robert C. Pozen
Robert C. Pozen
President
FIDELITY MAGELLAN FUND ON BEHALF OF
FIDELITY MAGELLAN FUND
BY: /s/Robert C. Pozen
Robert C. Pozen
Senior Vice President
Exhibit g(3)
APPENDIX "B"
TO
CUSTODIAN AGREEMENT
BETWEEN
State Street Bank and Trust Company and Each of the Investment
Companies Listed on Appendix A
Dated as of December 16, 1999
The following is a list of Additional Custodians, Special
Subcustodians and Foreign Subcustodians under the Custodian Agreement
dated as of February 1, 1996 (the "Custodian Agreement"):
A. Additional Custodians:
Custodian Purpose
Bank of New York Ficash
Fiterm
B. Special Subcustodians:
Subcustodian Purpose
Bank of New York Ficash
C. Foreign Subcustodians:
<TABLE>
<CAPTION>
<S> <C> <C>
COUNTRY SUBCUSTODIAN DEPOSITORY
Argentina Citibank, N.A., Buenos Aires Caja de Valores S.A.
Australia Westpac Banking Corporation, Austraclear Limited
Sydney
Reserve Bank Information and
Transfer System (RITS)
Austria GiroCredit Bank Oesterreichische Kontrollbank
AG der Sparkassen, Vienna AG (Wertpapiersammelbank
Division)
Bahrain The British Bank of the None
Middle East, Manama
Bangladesh Standard Chartered Bank, Dhaka None
Belgium Generale Bank, Brussels Caisse Interprofessionnelle de
Depots et de Virements de
Titres
S.A. (CIK)
Belgium Banque Nationale de Belgique
Bermuda The Bank of Bermuda Limited None
Bostwana Barclays Bank of Bostwana None
Limited, Gaborone
Brazil Citibank, N.A., Sao Paulo Bolsa de Valores de Sao Paulo
(Bovespa); Banco Central do
Brasil, Systema
Especial de Liquidacao e
Custodia
(SELIC); Rio de Janeiro Stock
Exchange
(BVRJ); Central de Custodia e
Liquidacao
Financeira de Titulos
(CETIP); Companhia
Brasileria de Liquidacao e
Custodia
Bulgaria ING Bank N.V., Sofia Central Depository AD (CDAD)
The Bulgarian National Bank
Canada State Street Trust Company Canadian Depository for
Canada, Toronto Securities Limited (CDS)
Chile Citibank, N.A., Santiago Deposito Central de Valores
S.A. (DCV)
China The Hongkong and Shanghai Shanghai Securities Central
Banking Corporation Limited, Clearing and Registration
Shanghai & Shenzhen branches Corporation (SSCRC);
Shenzhen Securities
Registrars Co.,
Ltd. (SSRC).
Colombia Cititrust Colombia S.A. Deposito Centralizado de
Valores
Sociedad Fiduciaria, Bogota (DECEVAL)
Cyprus The Cyprus Popular Bank
Czech Republic Ceskoslovenska Obchodni Stredisko Cennych Papiru (SCP);
Banka, A.S., Prague Czech National Bank (CNB)
Denmark Den Danske Bank, Copenhagen Vaerdipapericentralen- The
Danish
Securities Center (VP)
Ecuador Citibank, N.A., Quito None
Egypt The Egyptian British Bank Misr for Clearing, Settlement
and Depository
Finland Merita Bank Limited, Helsinki The Finnish Central
Securities Depository
Limited (CSD)
France Banque Paribas, Paris Societe Interprofessionnelle
pour la
Compensation des Valeurs
Mobilieres (SICOVAM)
Banque de France
Germany Dresdner Bank AG, Frankfurt Deutsche Borse Clearing (DBC)
Ghana Barclays Bank of Ghana Limited, None
Accra
Greece National Bank of Greece, S.A., Central Securities
Depository, S.A.
Athens (Apothtirion Tilton A.E.)
The Bank of Greece
Hong Kong Standard Chartered Bank, Hong Kong Securities Clearing
Co. Ltd.,
Hong Kong Central Clearing and
Settlement System
(CCASS)
The Central Money Markets
Unit CMU
Hungary Citibank Budapest Rt., Central Depository and
Clearing House
Budapest (Budapest) Ltd. (KELER Ltd.)
India Deutsche Bank AG, Mumbai; National Securities
Depository Limited
Hongkong & Shanghai Banking (NSDL)
Corporation, Ltd., Mumbai Reserve Bank of India
Central Depository Services
India Limited
Indonesia Standard Chartered Bank, Bank Indonesia
Jakarta PT Kustodian Sentral Efek
Indonesia
Ireland Bank of Ireland, Dublin Gilt Settlement Office (GSO)
Israel Bank Hapoalim B.M., Tel Aviv Tel Aviv Stock Exchange (TASE)
Clearinghouse, Ltd.
The Bank of Israel
Italy Banque Paribas, Milan Monte Titoli S.p.A.;
Banca d'Italia
Ivory Coast Societe Generale de Banques None
en Cote d'Ivoire, Abidjan
Japan Sumitomo Trust & Banking Japan Securities Depository
Center
Co., Ltd., Osaka; (JASDEC);
Daiwa Bank, Ltd., Tokyo; Bank of Japan
Fuji Bank, Ltd., Tokyo
The Sumitomo Bank, Limited
Jordan British Bank of the Middle None
East, Amman
Kenya Barclays Bank of Kenya Limited, The Central Bank of Kenya
Nairobi
Lebanon The British Bank of the Middle Midclear
East, Beirut
Central Bank of Lebanon
Malaysia Standard Chartered Bank Malaysia Central Depository
Sdn.
Malaysia Berhad, Kuala Lampur bhd. (MCD)
Bank Negara Malasia
Mauritius Hongkong and Shanghai Central Depository &
Settlement Co., Ltd.
Banking Corporation Limited,
Port Louis
Mexico Citibank Mexico, S.A., S.D. INDEVAL, S.A. de C.V.
Mexico City (Institucion para el
Deposito de
Valores)
Morocco Banque Commerciale du Maroc, MAROCLEAR
Casablanca
Netherlands MeesPierson N.V., Amesterdam Nederlands Centraal Instituut
voor
Giraal Effectenverkeer B.V.
(NECIGEF), KAS Associatie,
N.V. (KAS)
De Nederlandshe Bank
New Zealand ANZ Banking Group (New New Zealand Securities
Zealand) Limited, Wellington Depository Limited (NZCDS)
Norway Christiania Bank og Verdipapirsentralen (VPS)
Kreditkasse,
Oslo
Oman British Bank of the Middle Muscat Securities Market
East,
Muscat
Pakistan Deutsche Bank AG, Karachi The Central Depository
Company of Pakistan
State Street Bank of Pakistan
Peru Citibank, N.A., Lima Caja de Valores (CAVAL)
Philippines Standard Chartered Bank, The Philippines Central
Depository, Inc.
Manila
The Book-Entry-System of the
Central Bank
The Registry of Scripless
Securities of the
Bureau of the Treasury,
Department of
Finance
Poland Citibank Poland, S.A., Warsaw National Depository of
Securities;
National Bank of Poland
Bank Polska Kasa Opieki S.A.,
Warsaw
Portugal Banco Comercial Portuguese,
S.A., Central de Valores
Mobiliarios
Lisbon (Interbolsa)
Central Treasury Bills
Registrar
Romania ING Bank N.V., Bucharest National Company for
Clearing, Settlement &
Depository for Securities
(SNCDD)
National Bank of Romania
Bucharest Stock Exchange (BSE)
Russia Credit Suisse First Boston, AO None
Moscow
Singapore The Development Bank of Central Depository (Pte) Ltd.
(CDP)
Singapore Ltd., Singapore
The Monetary Authority of
Singapore
Slovak Republic Ceskoslovenska Obchodna Stredisko Cennych Papierov
(SCP)
Banka A.S., Bratislava National Bank of Slovakia (NBS)
Slovenia Banka Creditanstalt d.d., Klirinsko Depotna Druzba
Ljubljana,
a 99.96% owned subsidiary of
Creditanstalt AG
South Africa Standard Bank of South Africa The Central Depository (Pty)
Ltd. (CD)
Limited, Johannesburg STRATE
South Korea The Hongkong and Shanghai Korean Securities
Depositories (KSD)
Banking Corporation, Limited
Seoul
Spain Banco Santander, S.A., Servicio de Compensacion y
Madrid Liquidacion de Valores (SCLV);
Banco de Espana
Sri Lanka Hongkong and Shanghai Central Depository System (Pvt)
Banking Corp. Ltd., Colombo Limited (CDS)
Swaziland Standard Bank Swaziland, None
Limited, Mbabane
Sweden Skandinaviska Enskilda Banken, Vardepapperscentralen AB
Stockholm
The Swedish Central
Securities Depository
Switzerland UBS AG, Schweizerische Effekten-Giro AG
Zurich (SEGA)
Taiwan Central Trust of China, Taiwan Securities Central
Taipei Depository Company (TSCD)
Thailand Standard Chartered Bank, Thailand Securities Depository
Bangkok Company Limited (TSD)
Transnational Cedel Bank Societe Anonyme
INTERSETTLE
The Euroclear System
Turkey Citibank, N.A., Istanbul Istanbul Stock Exchange
Settlement
and Custody Co., Inc. (I.M.K.B.
Takas ve Saklama A.S.);
Central Bank of Turkey
United Kingdom State Street Bank and Trust Central Gilts Office (CGO);
Company, London Central Moneymarkets Office
State Street London Limited, (CMO); European Settlement
Office (ESO)
London
Uruguay Citibank, N.A., Montevideo None
BankBoston, N.A.
Venezuela Citibank, N.A., Caracas The Central Bank of Venezuela
Zambia Barclays Bank of Zambia Lusaka Central Depository (LCD)
Limited, Lusaka (overseen by Lusaka Stock
Exchange)
The Bank of Zambia
</TABLE>
Each of the Investment Companies Listed on
Appendix A to the Custodian Agreement, on
Behalf of Each of Their Respective Portfolios
By: /s/John Costello
Name: John Costello
Title: Assistant Treasurer
EXHIBIT G(11)
SCHEDULE A-1
COLCHESTER STREET TRUST
Domestic Portfolio
Government Portfolio
Money Market Portfolio
Treasury Portfolio
Treasury Only Portfolio
FIDELITY ABERDEEN STREET TRUST
Fidelity Freedom 2030 Fund
Fidelity Freedom 2020 Fund
Fidelity Freedom 2010 Fund
Fidelity Freedom 2000 Fund
Fidelity Freedom Income Fund
FIDELITY ADVISOR EMERGING ASIA FUND, INC.
FIDELITY ADVISOR KOREA FUND, INC.
FIDELITY ADVISOR SERIES I
Fidelity Advisor Balanced Fund
Fidelity Advisor Dividend Growth Fund
Fidelity Advisor Equity Growth Fund
Fidelity Advisor Equity Income Fund
Fidelity Advisor Growth & Income Fund
Fidelity Advisor Growth Opportunities Fund
Fidelity Advisor Large Cap Fund
Fidelity Advisor Mid Cap Fund
Fidelity Advisor Small Cap Fund
Fidelity Advisor Value Strategies Fund
Fidelity Advisor TechnoQuant Growth Fund
Fidelity Asset Allocation Fund
Fidelity Retirement Growth Fund
FIDELITY ADVISOR SERIES II
Fidelity Advisor Government Investment Fund
Fidelity Advisor High Income Fund
Fidelity Advisor High Yield Fund
Fidelity Advisor Intermediate Bond Fund
Fidelity Advisor Mortgage Securities Fund
Fidelity Advisor Short Fixed-Income Fund
Fidelity Advisor Strategic Income Fund
FIDELITY ADVISOR SERIES III
FIDELITY ADVISOR SERIES IV
Fidelity Institutional Short-Intermediate Government Fund
Fidelity Real Estate High Income Fund
FIDELITY ADVISOR SERIES VII
Fidelity Advisor Consumer Industries Fund
Fidelity Advisor Cyclical Industries Fund
Fidelity Advisor Financial Services Fund
Fidelity Advisor Health Care Fund
Fidelity Advisor Natural Resources Fund
Fidelity Advisor Technology Fund
Fidelity Advisor Utilities Growth Fund
FIDELITY ADVISOR SERIES VIII
Fidelity Advisor Diversified International Fund
Fidelity Advisor Emerging Markets Income Fund
Fidelity Advisor Europe Capital Appreciation Fund
Fidelity Advisor Global Equity Fund
Fidelity Advisor International Capital Appreciation Fund
Fidelity Advisor Japan Fund
Fidelity Advisor Latin America Fund
Fidelity Advisor Overseas Fund
FIDELITY BEACON STREET TRUST
Fidelity Tax Managed Stock Fund
FIDELITY BOSTON STREET TRUST
Fidelity Target Timeline 2001
Fidelity Target Timeline 2003
FIDELITY CAPITAL TRUST
Fidelity Capital Appreciation Fund
Fidelity Disciplined Equity Fund
Fidelity Small Cap Selector
Fidelity Stock Selector
Fidelity TechnoQuant Growth Fund
Fidelity Value Fund
FIDELITY CHARLES STREET TRUST
Fidelity Asset Manager
Fidelity Asset Manager: Aggressive
Fidelity Asset Manager: Growth
Fidelity Asset Manager: Income
Spartan Investment Grade Bond Fund
FIDELITY COMMONWEALTH TRUST
Fidelity Intermediate Bond Fund
Fidelity Large Cap Stock Fund
Fidelity Mid-Cap Stock Fund
Fidelity Small Cap Stock Fund
Spartan 500 Index Fund
FIDELITY CONCORD STREET TRUST
Fidelity U.S. Bond Index Fund
Spartan Extended Market Index Fund
Spartan International Index Fund
Spartan Total Market Index Fund
Spartan U.S. Equity Index Fund
FIDELITY CONGRESS STREET FUND
FIDELITY CONTRAFUND
FIDELITY COVINGTON TRUST
Fidelity Real Estate High Income Fund II
FIDELITY DESTINY PORTFOLIOS
Destiny I
Destiny II
FIDELITY DEVONSHIRE TRUST
Fidelity Equity-Income Fund
Fidelity Real Estate Investment Portfolio
Fidelity Utilities Fund
FIDELITY EXCHANGE FUND
FIDELITY FINANCIAL TRUST
Fidelity Convertible Securities Fund
Fidelity Equity-Income II Fund
Fidelity Retirement Growth Fund
FIDELITY FIXED-INCOME TRUST
Fidelity High Income Fund
Fidelity Investment Grade Bond Fund
Fidelity Short-Term Bond Fund
Spartan Government Income Fund
FIDELITY HASTINGS STREET TRUST
Fidelity Contra Fund II
Fidelity Fifty
Fidelity Fund
FIDELITY HEREFORD STREET TRUST
Spartan Money Market Fund
Spartan U.S. Government Money Market Fund
Spartan U.S. Treasury Money Market Fund
FIDELITY INCOME FUND
Fidelity Ginnie Mae Fund
Fidelity Government Income Fund
Fidelity Intermediate Government Income Fund
FIDELITY INVESTMENT TRUST
Fidelity Canada Fund
Fidelity Diversified International Fund
Fidelity Emerging Markets Fund
Fidelity Europe Capital Appreciation Fund
Fidelity Europe Fund
Fidelity France Fund
Fidelity Germany Fund
Fidelity Global Balanced Fund
Fidelity Hong Kong and China Fund
Fidelity International Growth & Income Fund
Fidelity Aggressive International Fund
Fidelity Japan Fund
Fidelity Japan Smaller Companies Fund
Fidelity Latin America Fund
Fidelity Nordic Fund
Fidelity Overseas Fund
Fidelity Pacific Basin Fund
Fidelity Southeast Asia Fund
Fidelity United Kingdom Fund
Fidelity Worldwide Fund
FIDELITY MAGELLAN FUND
FIDELITY MONEY MARKET TRUST
Retirement Government Money Market Portfolio
Retirement Money Market Portfolio
FIDELITY MT. VERNON STREET TRUST
Fidelity Aggressive Growth Fund
Fidelity Growth Company Fund
Fidelity New Millennium Fund
FIDELITY OXFORD STREET TRUST
Fidelity Four-in-One Index Fund
FIDELITY PHILLIPS STREET TRUST
Fidelity Cash Reserves
Fidelity U.S. Government Reserves
FIDELITY PURITAN TRUST
Fidelity Balanced Fund
Fidelity Low-Priced Stock Fund
Fidelity Puritan Fund
FIDELITY REVERE STREET TRUST
Central Cash Collateral Fund
Taxable Central Cash Fund
FIDELITY SCHOOL STREET TRUST
Fidelity International Bond Fund
Fidelity New Markets Income Fund
Fidelity Strategic Income Fund
FIDELITY SECURITIES FUND
Fidelity Blue Chip Growth Fund
Fidelity Dividend Growth Fund
Fidelity Growth & Income Portfolio
Fidelity OTC Portfolio
FIDELITY SELECT PORTFOLIOS
Air Transportation Portfolio
Automotive Portfolio
Banking Portfolio
Biotechnology Portfolio
Brokerage and Investment Management Portfolio
Business Services and Outsourcing Portfolio
Chemicals Portfolio
Computers Portfolio
Construction and Housing Portfolio
Consumer Industries Portfolio
Cyclical Industries Portfolio
Defense and Aerospace Portfolio
Developing Communications Portfolio
Electronics Portfolio
Energy Portfolio
Energy Service Portfolio
Environmental Services Portfolio
Financial Services Portfolio
Food and Agriculture Portfolio
Gold Portfolio
Health Care Portfolio
Home Finance Portfolio
Industrial Equipment Portfolio
Industrial Materials Portfolio
Insurance Portfolio
Leisure Portfolio
Medical Delivery Portfolio
Medical Equipment and Systems Portfolio
Money Market Portfolio
Multimedia Portfolio
Natural Gas Portfolio
Natural Resources Portfolio
Paper and Forest Products Portfolio
Retailing Portfolio
Software and Computer Services Portfolio
Technology Portfolio
Telecommunications Portfolio
Transportation Portfolio
Utilities Growth Portfolio
FIDELITY SUMMER STREET TRUST
Fidelity Capital & Income Fund
FIDELITY TREND FUND
FIDELITY UNION STREET TRUST
Fidelity Export and Multinational Fund
FIDELITY UNION STREET TRUST II
Fidelity Daily Income Trust
FIDELITY U.S. INVESTMENTS BOND FUND, LP.
FIDELITY U.S. INVESTMENTS GOVERNMENT SECURITIES FUND, LP.
NEWBURY STREET TRUST
Prime Fund
Treasury Fund
NORTH CAROLINA CAPITAL MANAGEMENT TRUST
Cash Portfolio
Term Portfolio
VARIABLE INSURANCE PRODUCTS FUND
Equity-Income Portfolio
Growth Portfolio
High Income Portfolio
Money Market Portfolio
Overseas Portfolio
VARIABLE INSURANCE PRODUCTS FUND II
Asset Manager Portfolio
Asset Manager: Growth Portfolio
Contrafund Portfolio
Index 500 Portfolio
Investment Grade Bond Portfolio
VARIABLE INSURANCE PRODUCTS FUND III
Balanced Portfolio
Growth & Income Portfolio
Growth Opportunities Portfolio
Mid Cap Portfolio
FIDELITY ADVISOR WORLD EUROPE FUND (BERMUDA) LTD.
FIDELITY ADVISOR WORLD FUND (BERMUDA) LTD.
America Fund
America Growth Fund
Asian Special Situations Fund
Emerging Markets Fund
Hong Kong & China Fund
International Bond Fund
International Fund
Latin America Fund
Pacific Fund
US Dollar Bond Fund
FIDELITY ADVISOR WORLD GLOBAL HIGH INCOME FUND (BERMUDA) LTD.
FIDELITY ADVISOR WORLD SOUTHEAST ASIA FUND (BERMUDA) LTD.
FIDELITY ADVISOR WORLD U.S. LARGE-CAP STOCK FUND (BERMUDA) LTD.
FIDELITY ADVISOR WORLD U.S. LIMITED TERM BOND FUND (BERMUDA) LTD.
FIDELITY ADVISOR WORLD U.S. TREASURY MONEY FUND (BERMUDA) LTD.
FIDELITY INSTITUTIONAL CASH FUND PLC
FOR MASTER REPURCHASE AGREEMENTS WITH INDIVIDUAL FIDELITY FUNDS AS
BUYERS ONLY:
FIDELITY GLOBAL YIELD TRUST
CONSOLIDATED REPO ACCOUNT
Date: March 28, 2000 By: /s/Robert A. Dwight
Treasurer of the Fidelity Investment Companies and Authorized
Signatory of all other Funds and Accounts
Exhibit i(1)
Kirkpatrick & Lockhart llp 1800 Massachusetts Avenue, NW
Second Floor
Washington, DC 20036-1800
202.778.9000
www.kl.com
May 16, 2000
Fidelity Magellan Fund
82 Devonshire Street
Boston, Massachusetts 02109
Ladies and Gentlemen:
You have requested our opinion, as counsel to Fidelity Magellan Fund
(the "Trust"), as to certain matters regarding the issuance of Shares
of the Trust. As used in this letter, the term "Shares" means the
shares of beneficial interest of Fidelity Magellan Fund, a series of
the Trust.
As such counsel, we have examined certified or other copies, believed
by us to be genuine, of the Trust's Declaration of Trust and by-laws
and such resolutions and minutes of meetings of the Trust's Board of
Trustees as we have deemed relevant to our opinion, as set forth
herein. Our opinion is limited to the laws and facts in existence on
the date hereof, and it is further limited to the laws (other than the
conflict of law rules) in the Commonwealth of Massachusetts that in
our experience are normally applicable to the issuance of shares by
unincorporated voluntary associations and to the Securities Act of
1933 ("1933 Act"), the Investment Company Act of 1940 ("1940 Act") and
the regulations of the Securities and Exchange Commission ("SEC")
thereunder.
Based on present laws and facts, we are of the opinion that the
issuance of the Shares has been duly authorized by the Trust and that,
when sold in accordance with the terms contemplated by Post-Effective
Amendment No. 48 to the Trust's Registration Statement on Form N-1A
and each subsequent Post-Effective Amendment ("PEA") to said
registration statement, including receipt by the Trust of full payment
for the Shares and compliance with the 1933 Act and the 1940 Act, the
Shares will have been validly issued, fully paid and non-assessable.
The Trust is an entity of the type commonly known as a "Massachusetts
business trust." Under Massachusetts law, shareholders could, under
certain circumstances, be held personally liable for the obligations
of the Trust. The Declaration of Trust states that all persons
extending credit to, contracting with or having any claim against the
Trust or the Trustees shall look only to the assets of the appropriate
series of the Trust for payment under such credit, contract or claim;
and neither the shareholders nor the Trustees, nor any of their
agents, whether past, present or future, shall be personally liable
therefor. It also requires that every note, bond, contract or other
undertaking issued by or on behalf of the Trust or the Trustees
relating to the Trust shall include a recitation limiting the
obligation represented thereby to the Trust and its assets. The
Declaration of Trust further provides: (1) for indemnification from
the assets of the series of the Trust for all loss and expense of any
shareholder held personally liable for the obligations of the Trust by
virtue of ownership of shares of the Trust; and (2) for the series of
the Trust to assume the defense of any claim against the shareholder
for any act or obligation of the series of the Trust. Thus, the risk
of a shareholder incurring financial loss on account of shareholder
liability is limited to circumstances in which the Trust or series
would be unable to meet its obligations.
We hereby consent to this opinion accompanying or being incorporated
by reference in the PEA when it is filed with the SEC.
Very truly yours,
KIRKPATRICK & LOCKHART LLP
/s/ Kirkpatrick & Lockhart LLP
Exhibit j(1)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference into the
Prospectus and Statement of Additional Information in Post-Effective
Amendment No. 48 to the Registration Statement on Form N-1A of
Fidelity Magellan Fund, of our report dated May 5, 2000 on the
financial statements and financial highlights included in the March
31, 2000 Annual Report to Shareholders of Fidelity Magellan Fund.
We further consent to the references to our Firm under the headings
"Financial Highlights" in the Prospectus and "Auditor" in the
Statement of Additional Information.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Boston, Massachusetts
May 16, 2000
EXHIBIT M(1)
DISTRIBUTION AND SERVICE PLAN
FIDELITY MAGELLAN FUND: FIDELITY MAGELLAN FUND
1. This Distribution and Service Plan (the "Plan"), when effective in
accordance with its terms, shall be the written plan contemplated by
Rule 12b-1 under the Investment Company Act of 1940 (the "Act") of
Fidelity Magellan Fund (the "Portfolio"), a series of shares of
Fidelity Magellan Fund (the "Fund").
2. The Fund has entered into a General Distribution Agreement with
respect to the Portfolio with Fidelity Distributors Corporation (the
"Distributor"), a wholly-owned subsidiary of Fidelity Management &
Research Company (the "Adviser"), under which the Distributor uses all
reasonable efforts, consistent with its other business, to secure
purchasers for the Portfolio's shares of beneficial interest
("shares"). Under the agreement, the Distributor pays the expenses of
printing and distributing any prospectuses, reports and other
literature used by the Distributor, advertising, and other promotional
activities in connection with the offering of shares of the Portfolio
for sale to the public. It is recognized that the Adviser may use its
management fee revenues as well as past profits or its resources from
any other source, to make payment to the Distributor with respect to
any expenses incurred in connection with the distribution of Portfolio
shares, including the activities referred to above.
3. The Adviser directly, or through the Distributor, may, subject to
the approval of the Trustees, make payments to securities dealers and
other third parties who engage in the sale of shares or who render
shareholder support services, including but not limited to providing
office space, equipment and telephone facilities, answering routine
inquiries regarding the Portfolio, processing shareholder transactions
and providing such other shareholder services as the Fund may
reasonably request.
4. The Portfolio will not make separate payments as a result of this
Plan to the Adviser, Distributor or any other party, it being
recognized that the Portfolio presently pays, and will continue to
pay, a management fee to the Adviser. To the extent that any payments
made by the Portfolio to the Adviser, including payment of management
fees, should be deemed to be indirect financing of any activity
primarily intended to result in the sale of shares of the Portfolio
within the context of Rule 12b-1 under the Act, then such payments
shall be deemed to be authorized by this Plan.
5. This Plan shall become effective upon the approval by a vote of at
least a "majority of the outstanding voting securities of the
Portfolio" (as defined in the Act), the plan having been approved by a
vote of a majority of the Trustees of the Fund, including a majority
of Trustees who are not "interested persons" of the Fund (as defined
in the Act) and who have no direct or indirect financial interest in
the operation of this Plan or in any agreements related to this Plan
(the "Independent Trustees"), cast in person at a meeting called for
the purpose of voting on this Plan.
6. This Plan shall, unless terminated as hereinafter provided, remain
in effect from the date specified above until April 30, 2001 and from
year to year thereafter, provided, however, that such continuance is
subject to approval annually by a vote of a majority of the Trustees
of the Fund, including a majority of the Independent Trustees, cast in
person at a meeting called for the purpose of voting on this Plan.
This Plan may be amended at any time by the Board of Trustees,
provided that (a) any amendment to authorize direct payments by the
Portfolio to finance any activity primarily intended to result in the
sale of shares of the Portfolio, or to increase materially the amount
spent by the Portfolio for distribution, shall be effective only upon
approval by a vote of a majority of the outstanding voting securities
of the Portfolio, and (b) any material amendments of this Plan shall
be effective only upon approval in the manner provided in the first
sentence in this paragraph.
7. This Plan may be terminated at any time, without the payment of
any penalty, by vote of a majority of the Independent Trustees or by a
vote of a majority of the outstanding voting securities of the
Portfolio.
8. During the existence of this Plan, the Fund shall require the
Adviser and/or Distributor to provide the Fund, for review by the
Fund's Board of Trustees, and the Trustees shall review, at least
quarterly, a written report of the amounts expended in connection with
financing any activity primarily intended to result in the sale of
shares of the Portfolio (making estimates of such costs where
necessary or desirable) and the purposes for which such expenditures
were made.
9. This Plan does not require the Adviser or Distributor to perform
any specific type or level of distribution activities or to incur any
specific level of expenses for activities primarily intended to result
in the sale of shares of the Portfolio.
10. Consistent with the limitation of shareholder liability as set
forth in the Fund's Declaration of Trust or other organizational
document, any obligations assumed by the Portfolio pursuant to this
Plan and any agreements related to this Plan shall be limited in all
cases to the Portfolio and its assets, and shall not constitute
obligations of any other series of shares of the Fund.
11. If any provision of this Plan shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Plan
shall not be affected thereby.
