SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT (No. 2-78458)
UNDER THE SECURITIES ACT OF 1933 [X]
Post-Effective Amendment No. 37 [X]
and
REGISTRATION STATEMENT (No. 811-3518)
UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 37 [X]
Newbury Street Trust
(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 December 30, 1998 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
CASH MANAGEMENT
FUNDS
PRIME FUND - DAILY MONEY CLASS
(fund number 083)
TREASURY FUND - DAILY MONEY CLASS
(fund number 058)
TAX-EXEMPT FUND - DAILY MONEY CLASS
(fund number 084)
PROSPECTUS
DECEMBER 30, 1998(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON,
MA 02109
CONTENTS
FUND SUMMARY 2 INVESTMENT SUMMARY
3 PERFORMANCE
5 FEE TABLE
FUND BASICS 6 INVESTMENT DETAILS
7 VALUING SHARES
SHAREHOLDER INFORMATION 7 BUYING AND SELLING SHARES
15 EXCHANGING SHARES
15 ACCOUNT FEATURES AND POLICIES
17 DIVIDENDS AND CAPITAL GAINS
DISTRIBUTIONS
18 TAX CONSEQUENCES
FUND SERVICES 18 FUND MANAGEMENT
18 FUND DISTRIBUTION
APPENDIX 19 FINANCIAL HIGHLIGHTS
FUND SUMMARY
INVESTMENT SUMMARY
INVESTMENT OBJECTIVE
PRIME FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
Fidelity Management and Research Company (FMR)'s principal investment
strategies include:
(small solid bullet) Investing in U.S. dollar-denominated money market
securities o f domestic and foreign issuers rated in the highest
category by at least two nationally - recognized rating services,
U.S. Government securities and repurchase agreements and entering into
reverse repurchase agreements.
(small solid bullet) Investing more than 25% of total assets in the
financial services industry.
(small solid bullet) Generally maintaining a dollar-weighted
average maturity at 60 days or less.
(small solid bullet) Investing in compliance with industry-standard
requirements for money market funds for the quality, maturity and
diversification of investments.
PRINCIPAL INVESTMENT RISKS
The fund is subject to the following principal investment risks:
(small solid bullet) INTEREST RATE CHANGES. Interest rate increases
can cause the price of a money market security to decrease.
(small solid bullet) FOREIGN EXPOSURE. Entities located in foreign
countries can be affected by adverse political, regulatory, market or
economic developments in those countries.
(small solid bullet) FINANCIAL SERVICES EXPOSURE. Changes in
government regulation or economic downturns can have a significant
negative affect on issuers in the financial services sector.
(small solid bullet) ISSUER-SPECIFIC CHANGES. A decline in the credit
quality of an issuer or the provider of credit support or a
maturity-shortening structure for a security can cause the price of a
money market security to decrease.
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. Although the fund seeks to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in the fund.
INVESTMENT OBJECTIVE
TREASURY FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing in U.S. Treasury securities and
repurchase agreements for those securities.
(small solid bullet) Generally maintaining a dollar-weighted
average maturity at 60 days or less.
(small solid bullet) Investing in compliance with industry-standard
requirements for money market funds for the quality, maturity and
diversification of investments.
PRINCIPAL INVESTMENT RISKS
The fund is subject to the following principal investment risks:
(small solid bullet) INTEREST RATE CHANGES. Interest rate increases
can cause the price of a money market security to decrease.
(small solid bullet) ISSUER-SPECIFIC CHANGES. A decline in the credit
quality of an issuer or the provider of credit support or a
maturity-shortening structure for a security can cause the price of a
money market security to decrease.
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. Although the fund seeks to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in the fund.
INVESTMENT OBJECTIVE
TAX-EXEMPT FUND seeks to provide as high a level of current income,
exempt from federal income taxes, as is consistent with liquidity and
stability of principal.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing normally in municipal money
market securities.
(small solid bullet) Investing so that at least 80% of the fund's
income distributions is exempt from federal income tax.
(small solid bullet) Normally not investing in municipal securities
whose interest is subject to federal income tax or in municipal
securities whose interest is subject to the federal alternative
minimum tax.
(small solid bullet) Potentially investing more than 25% of total
assets in municipal securities that finance similar types of
projects.
(small solid bullet) Investing in compliance with industry-standard
requirements for money market funds for the quality, maturity and
diversification of investments.
PRINCIPAL INVESTMENT RISKS
The fund is subject to the following principal investment risks:
(small solid bullet) MUNICIPAL MARKET VOLATILITY. The municipal market
is volatile and can be significantly affected by adverse tax,
legislative or political changes and the financial condition of the
issuers of municipal securities.
(small solid bullet) INTEREST RATE CHANGES. Interest rate increases
can cause the price of a money market security to decrease.
(small solid bullet) FOREIGN EXPOSURE. Entities located in foreign
countries can be affected by adverse political, regulatory, market or
economic developments in those countries.
(small solid bullet) ISSUER-SPECIFIC CHANGES. A decline in the credit
quality of an issuer or the provider of credit support or a
maturity-shortening structure for a security can cause the price of a
money market security to decrease.
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. Although the fund seeks to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in the fund.
PERFORMANCE
The following information illustrates the changes in the funds'
performance from year to year. Returns are based on past results and
are not an indication of future performance.
YEAR-BY-YEAR RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
PRIME
FUND -
DAILY
MONEY
CLASS
CALENDAR YEARS 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997
7.28% 9.06% 7.99% 5.76% 3.32% 2.70% 3.79% 5.49% 4.95% 5.11%
</TABLE>
PERCENTAGE (%)
ROW: 1, COL: 1, VALUE: 7.28
ROW: 2, COL: 1, VALUE: 9.060000000000001
ROW: 3, COL: 1, VALUE: 7.99
ROW: 4, COL: 1, VALUE: 5.76
ROW: 5, COL: 1, VALUE: 3.32
ROW: 6, COL: 1, VALUE: 2.7
ROW: 7, COL: 1, VALUE: 3.79
ROW: 8, COL: 1, VALUE: 5.49
ROW: 9, COL: 1, VALUE: 4.95
ROW: 10, COL: 1, VALUE: 5.11
DURING THE PERIODS SHOWN IN THE CHART FOR DAILY MONEY CLASS OF PRIME
FUND, THE HIGHEST RETURN FOR A QUARTER WAS 2.32 % (QUARTER
ENDING JUNE 30, 1989), AND THE LOWEST RETURN FOR A QUARTER WAS
0.66 % (QUARTER ENDING SEPTEMBER 30, 19 93 ).
THE YEAR-TO-DATE RETURN AS OF SEPTEMBER 30, 1998 FOR DAILY MONEY CLASS
OF PRIME FUND WAS 3.83 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TREASURY
FUND -
DAILY
MONEY
CLASS
CALENDAR YEARS 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997
7.08% 8.96% 7.84% 5.57% 3.37% 2.66% 3.63% 5.42% 4.85% 5.01%
</TABLE>
PERCENTAGE (%)
ROW: 1, COL: 1, VALUE: 7.08
ROW: 2, COL: 1, VALUE: 8.960000000000001
ROW: 3, COL: 1, VALUE: 7.84
ROW: 4, COL: 1, VALUE: 5.57
ROW: 5, COL: 1, VALUE: 3.37
ROW: 6, COL: 1, VALUE: 2.66
ROW: 7, COL: 1, VALUE: 3.63
ROW: 8, COL: 1, VALUE: 5.42
ROW: 9, COL: 1, VALUE: 4.85
ROW: 10, COL: 1, VALUE: 5.01
DURING THE PERIODS SHOWN IN THE CHART FOR DAILY MONEY CLASS OF
TREASURY FUND, THE HIGHEST RETURN FOR A QUARTER WAS 2.28 %
(QUARTER ENDING JUNE 30, 198 9 ), AND THE LOWEST RETURN
FOR A QUARTER WAS 0.65 % (QUARTER ENDING DECEMBER 31,
19 93 ).
THE YEAR-TO-DATE RETURN AS OF SEPTEMBER 30, 1998 FOR DAILY MONEY CLASS
OF TREASURY FUND WAS 3.76 %.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
TAX-EXE
MPT FUND
- - DAILY
MONEY
CLASS
CALENDAR YEARS 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997
4.66% 5.76% 5.38% 4.20% 2.66% 2.05% 2.41% 3.38% 2.97% 3.15%
</TABLE>
PERCENTAGE (%)
ROW: 1, COL: 1, VALUE: 4.66
ROW: 2, COL: 1, VALUE: 5.76
ROW: 3, COL: 1, VALUE: 5.38
ROW: 4, COL: 1, VALUE: 4.2
ROW: 5, COL: 1, VALUE: 2.66
ROW: 6, COL: 1, VALUE: 2.05
ROW: 7, COL: 1, VALUE: 2.41
ROW: 8, COL: 1, VALUE: 3.38
ROW: 9, COL: 1, VALUE: 2.97
ROW: 10, COL: 1, VALUE: 3.15
DURING THE PERIODS SHOWN IN THE CHART FOR DAILY MONEY CLASS OF
TAX-EXEMPT FUND, THE HIGHEST RETURN FOR A QUARTER WAS 1.51 %
(QUARTER ENDING JUNE 30, 19 89 ), AND THE LOWEST RETURN
FOR A QUARTER WAS 0.46 % (QUARTER ENDING MARCH 31,
19 94 ).
THE YEAR-TO-DATE RETURN AS OF SEPTEMBER 30, 1998 FOR DAILY
MONEY CLASS OF TAX-EXEMPT FUND WAS 2.24 %.
AVERAGE ANNUAL RETURNS
FOR THE PERIODS ENDED PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
DECEMBER 31, 1997
PRIME FUND - DAILY 5.11 % 4.40 % 5.53 %
MONEY CLASS
TREASURY FUND - DAILY 5.01 % 4.31 % 5.42 %
MONEY CLASS
TAX-EXEMPT FUND - DAILY 3.15 % 2.79 % 3.65 %
MONEY CLASS
If FMR had not reimbursed certain class expenses during these periods,
Daily Money Class's total returns would have been lower.
FEE TABLE
The following table describes the fees and expenses that are incurred
when you buy, hold or sell Daily Money Class shares of a fund. The
annual class operating expenses provided below for Daily Money
Class are higher than the expenses actually paid by the class
as the result of expense reimbursements during the period.
SHAREHOLDER FEES (PAID BY THE INVESTOR DIRECTLY)
SALES CHARGE (LOAD) ON NONE
PURCHASES AND
REINVESTED DISTRIBUTIONS
DEFERRED SALES CHARGE NONE
(LOAD) ON REDEMPTIONS
ANNUAL CLASS OPERATING EXPENSES (PAID FROM CLASS ASSETS)
PRIME FUND MANAGEMENT FEE 0.25%
DISTRIBUTION AND SERVICE 0.25%
(12B-1) FEE
OTHER EXPENSES 0.26%
TOTAL ANNUAL CLASS 0.76%
OPERATING EXPENSESA
TREASURY FUND MANAGEMENT FEE 0.25%
DISTRIBUTION AND SERVICE 0.25%
(12B-1) FEE
OTHER EXPENSES 0.26%
TOTAL ANNUAL CLASS 0.76%
OPERATING EXPENSESA
TAX-EXEMPT MANAGEMENT FEE 0.25%
FUND
DISTRIBUTION AND SERVICE 0.25%
(12B-1) FEE
OTHER EXPENSES 0.29%
TOTAL ANNUAL CLASS 0.79%
OPERATING EXPENSESA
A FMR HAS VOLUNTARILY AGREED TO REIMBURSE DAILY MONEY CLASS OF
EACH FUND TO THE EXTENT THAT TOTAL OPERATING EXPENSES ( EXCLUDING
INTEREST, TAXES, BROKERAGE COMMISSIONS AND EXTRAORDINARY
EXPENSES ), AS A PERCENTAGE OF THEIR RESPECTIVE AVERAGE NET ASSETS,
EXCEED 0.65%. THESE ARRANGEMENTS CAN BE TERMINATED BY FMR AT ANY TIME.
E ach fund has entered into arrangements with its custodian and
transfer agent whereby credits realized as a result of uninvested cash
balances are used to reduce custodian and transfer agent expenses.
This EXAMPLE helps you compare the cost of investing in the funds with
the cost of investing in other mutual funds.
Let's say, hypothetically, that Daily Money Class's annual return is
5% and that your shareholder fees and Daily Money Class'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 after the number
of years indicated:
PRIME FUND 1 YEAR $ 78
3 YEARS $ 243
5 YEARS $ 422
10 YEARS $ 942
TREASURY FUND 1 YEAR $ 7 8
3 YEARS $ 2 43
5 YEARS $ 4 22
10 YEARS $ 9 42
TAX-EXEMPT 1 YEAR $ 81
FUND
3 YEARS $ 252
5 YEARS $ 439
10 YEARS $ 978
FUND BASICS
INVESTMENT DETAILS
INVESTMENT OBJECTIVE
PRIME FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
FMR invests the fund's assets in U.S. dollar-denominated money market
securities of domestic and foreign issuers rated in the highest
category by at least two nationally recognized rating services, U.S.
Government securities and repurchase agreements. FMR also may enter
into reverse repurchase agreements for the fund.
FMR will invest more than 25% of the fund's total assets in the
financial services industry.
FMR generally intends to maintain the fund's
dollar-weighted average maturity at 60 days or less.
In buying and selling securities for the fund, FMR complies with
industry-standard requirements for money market funds regarding the
quality, maturity and diversification of the fund's investments. FMR
stresses maintaining a stable $1.00 share price, liquidity and income.
INVESTMENT OBJECTIVE
TREASURY FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
FMR invests the fund's assets in U.S. Treasury securities and
repurchase agreements for those securities. FMR does not enter into
reverse repurchase agreements for the fund.
FMR generally intends to maintain the fund's
dollar-weighted average maturity at 60 days or less.
In buying and selling securities for the fund, FMR complies with
industry-standard requirements for money market funds regarding the
quality, maturity and diversification of the fund's investments. FMR
stresses maintaining a stable $1.00 share price, liquidity and income.
INVESTMENT OBJECTIVE
TAX-EXEMPT FUND seeks to provide as high a level of current income,
exempt from federal income taxes, as is consistent with liquidity and
stability of principal.
PRINCIPAL INVESTMENT STRATEGIES
FMR normally invests the fund's assets in municipal money market
securities.
FMR normally invests the fund's assets so that at least 80% of the
fund's income distributions is exempt from federal income tax. FMR
does not currently intend to invest the fund's assets in municipal
securities whose interest is subject to federal income tax or in
municipal securities whose interest is subject to the federal
alternative minimum tax.
FMR may invest more than 25% of the fund's total assets in securities
that finance similar projects, such as those relating to education,
health care, transportation and utilities.
In buying and selling securities for the fund, FMR complies with
industry-standard requirements for money market funds regarding the
quality, maturity and diversification of the fund's investments. FMR
stresses maintaining a stable $1.00 share price, liquidity and income.
DESCRIPTION OF PRINCIPAL SECURITY TYPES
MONEY MARKET SECURITIES are high quality, short-term debt securities
that pay a fixed, variable or floating interest rate. Securities are
often specifically structured so that they are eligible investments
for a money market fund. For example, in order to satisfy the maturity
restrictions for a money market fund, some money market securities
have demand or put features which have the effect of shortening the
security's maturity. Taxable money market securities include bank
certificates of deposit, bank acceptances , bank time
deposits, notes, commercial paper and U.S. Government securities.
Municipal money market securities include variable rate demand notes,
commercial paper and municipal notes.
U.S. GOVERNMENT SECURITIES are high quality securities issued or
guaranteed by the U.S. Treasury or by an agency or instrumentality of
the U.S. Government. U.S. Government securities may be backed by the
full faith and credit of the U.S. Treasury, the right to borrow from
the U.S. Treasury, or the agency or instrumentality issuing or
guaranteeing the security.
MUNICIPAL SECURITIES are issued to raise money for a variety of public
and private purposes, including general financing for state and local
governments, or financing for a specific project or public facility.
Municipal securities may be fully or partially backed by the local
government, by the credit of a private issuer, by the current or
anticipated revenues from a specific project or specific assets, or by
domestic or foreign entities providing credit support such as letters
of credit, guarantees or insurance.
A REPURCHASE AGREEMENT is an agreement to buy a security at one
price and a simultaneous agreement to sell it back at a n
agreed-upon price.
PRINCIPAL INVESTMENT RISKS
Many factors affect each fund's performance. A fund's yield will
change daily based on changes in interest rates and other market
conditions. Although each fund is managed to maintain a stable $1.00
share price, there is no guarantee that the fund will be able to do
so. For example, a major increase in interest rates or a decrease in
the credit quality of the issuer of one of a fund's investments could
cause the fund's share price to decrease. While the funds will be
charged premiums by a mutual insurance company for coverage of
specified types of losses related to default or bankruptcy on certain
securities, a fund may incur losses regardless of the insurance.
It is important to note that neither the funds nor their yields
are guaranteed by the U.S. Government.
The following factors may significantly affect a fund's performance:
MUNICIPAL MARKET VOLATILITY. Municipal securities can be
significantly affected by political changes as well as uncertainties
in the municipal market related to taxation, legislative changes, or
the rights of municipal security holders. Because many municipal
securities are issued to finance similar types of projects, especially
those relating to education, health care, transportation and
utilities, conditions in those sectors can affect the overall
municipal market. In addition, changes in the financial condition of
an individual municipal insurer can affect the overall municipal
market.
INTEREST RATE CHANGES. Money market securities have varying levels of
sensitivity to changes in interest rates. In general, the price of a
money market security can fall when interest rates rise and can rise
when interest rates fall. Securities with longer maturities and the
securities of issuers in the financial services industry can be more
sensitive to interest rate changes. Short-term securities tend to
react to changes in short-term interest rates.
FOREIGN EXPOSURE. Issuers located in foreign countries and entities
located in foreign countries that provide credit support or a
maturity-shortening structure can involve increased risks. Extensive
public information about the issuer or provider may not be available
and unfavorable political, economic or governmental developments could
affect the value of the security.
FINANCIAL SERVICES EXPOSURE. Financial services companies are
highly dependent on the supply of short-term financing. The value of
securities of issuers in the financial services sector can be
sensitive to changes in government regulation and interest rates and
to economic downturns in the United States and abroad.
ISSUER-SPECIFIC CHANGES. Changes in the financial condition of an
issuer, changes in specific economic or political conditions that
affect a particular type of issuer, and changes in general economic or
political conditions can affect the credit quality or value of an
issuer's securities. Entities providing credit support or a
maturity-shortening structure also can be affected by these types of
changes. Municipal securities backed by current or anticipated
revenues from a specific project or specific assets can be negatively
affected by the discontinuance of the taxation supporting the project
or assets or the inability to collect revenues for the project or from
the assets. If the Internal Revenue Service determines an issuer of
a municipal security has not complied with applicable tax
requirements, interest from the security could become taxable and the
security could decline significantly in value. In addition, if the
structure of a security fails to function as intended,
interest from the security could become taxable or the
security could decline in value.
In response to market, economic, political or other conditions, FMR
may temporarily use a different investment strategy for Tax-Exempt
Fund for defensive purposes. If FMR does so, different factors
could affect Tax-Exempt Fund's performance, and the f und
may distribute income subject to federal income tax.
FUNDAMENTAL INVESTMENT POLICIES
The policies below are fundamental, that is, subject to change only by
shareholder approval.
PRIME FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
TREASURY FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
TAX-EXEMPT FUND seeks to provide individual and institutional
investors with as high a level of current income, exempt from federal
income taxes, as is consistent with a portfolio of high quality,
short-term municipal obligations selected on the basis of liquidity
and stability of principal. The fund normally invests so that at least
80% of its income distributions is free from federal income tax.
VALUING SHARES
The funds are open for business each day the New York Stock Exchange
(NYSE) is open.
A class's net asset value per share (NAV) is the value of a single
share. Fidelity(registered trademark) normally calculates Daily Money
Class'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). Each fund's assets are valued as of this
time for the purpose of computing Daily Money Class's NAV.
To the extent that each 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 a fund's assets may not occur on days when the fund
is open for business.
Each fund's assets are valued on the basis of amortized cost.
SHAREHOLDER INFORMATION
BUYING AND SELLING SHARES
GENERAL INFORMATION
For account, product and service information, please call
1-800-843-3001 (8:30 a.m.-7:00 p.m. Eastern time, Monday through
Friday).
Please use the following addresses:
BUYING OR SELLING SHARES
Fidelity Investments
P.O. Box 770002
Cincinnati, OH 45277-0081
OVERNIGHT EXPRESS
Fidelity Investments
2300 Litton Lane - KH2A
Hebron, KY 41048
You may buy or sell Daily Money Class shares of the funds through a
retirement account or an investment professional. When you invest
through a retirement account or an investment professional, the
procedures for buying, selling and exchanging Daily Money Class shares
of a fund and the account features and policies may differ. Additional
fees may also apply to your investment in Daily Money Class shares of
a fund, including a transaction fee if you buy or sell Daily Money
Class shares of a fund through a broker or other investment
professional.
Certain methods of contacting Fidelity, such as by telephone, may be
unavailable or delayed (for example, during periods of unusual market
activity).
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) ROTH CONVERSION IRAS
(solid bullet) ROLLOVER IRAS
(solid bullet) 401(K) PLANS, AND CERTAIN OTHER 401(A)-QUALIFIED PLANS
(solid bullet) SIMPLE IRAS
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS)
(solid bullet) SALARY REDUCTION SEP-IRAS (SARSEPS)
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
The price to buy one share of Daily Money Class is the class's NAV.
Your shares will be bought at the next NAV calculated after your order
is received in proper form.
It is the responsibility of your investment professional to transmit
your order to buy shares to Fidelity before the close of business on
the day you place your order.
Short-term or excessive trading into and out of a fund may harm
performance by disrupting portfolio management strategies and by
increasing expenses. Accordingly, a 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
that fund. For these purposes, FMR may consider an investor's trading
history in that fund or other Fidelity funds, and accounts under
common ownership or control.
Each 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) You are advised to place your trades as early in
the day as possible and to provide Fidelity with advance notice of
large purchases.
(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 a fund or
Fidelity has incurred.
(small solid bullet) If when you place your wire purchase order you
indicate that Fidelity will receive your wire that day, your wire must
be received in proper form by Fidelity at the applicable fund's
designated wire bank before the close of the Federal Reserve Wire
System on the day of purchase.
Daily Money Class shares can be bought or sold through
investment professionals using an automated order placement and
settlement system that guarantees payment for orders on a specified
date.
MINIMUMS
TO OPEN AN ACCOUNT $1,000
For certain Fidelity retirement accountsA $500
TO ADD TO AN ACCOUNT $250
For certain Fidelity retirement accountsA $100
Through regular investment plans $100
MINIMUM BALANCE $500
A FIDELITY TRADITIONAL IRA, ROTH IRA, ROTH CONVERSION IRA, ROLLOVER
IRA, SEP-IRA, AND KEOGH ACCOUNTS.
There is no minimum account balance or initial or subsequent purchase
minimum for certain Fidelity retirement accounts funded through salary
deduction, or accounts opened with the proceeds of distributions from
such retirement accounts. In addition, each fund may waive or lower
purchase minimums in other circumstances.
KEY INFORMATION
PHONE TO OPEN AN ACCOUNT
1-800-843-3001 (bullet)
Exchange from Daily
Money Class of another
fund offered through this
prospectus, from Class A
or Class T of a Fidelity
Advisor fund, or from
another Fidelity fund.
Call your investment
professional or, if you
trade directly through
Fidelity, call
1-800-843-3001.
TO ADD TO AN
ACCOUNT
(bullet)
Exchange from Daily
Money Class of another
fund offered through this
prospectus, from Class A
or Class T of a Fidelity
Advisor fund, or from
another Fidelity fund.
Call your investment
professional or, if you
trade directly through
Fidelity, call
1-800-843-3001.
MAIL TO OPEN AN
FIDELITY ACCOUNT
INVESTMENTS (bullet)
P.O. BOX 770002 Complete and sign the
CINCINNATI, OH application. Make your
45277-0081 check payable to the
complete name of the
fund and note the
applicable class. Mail to
your investment
professional or, if you
trade directly through
Fidelity, to the address
at left.
TO ADD TO AN
ACCOUNT
(bullet)
Make your check
payable to the complete
name of the fund and
note the applicable
class. Include your fund
account number on your
check and mail to your
investment professional
or, if you trade directly
through Fidelity, to the
address at left.
(bullet)
Exchange from Daily
Money Class of another
fund offered through this
prospectus, from Class A
or Class T of a Fidelity
Advisor fund, or from
another Fidelity fund.
Send a letter of
instruction to your
investment professional
or, if you trade directly
through Fidelity, to the
address at left, including
your name, the funds'
names, the applicable
class names, the fund
account numbers, and
the dollar amount or
number of shares to be
exchanged.
IN PERSON TO OPEN AN
ACCOUNT
(bullet)
Bring your application
and check to your
investment professional.
TO ADD TO AN
ACCOUNT
(bullet)
Bring your check to your
investment professional.
WIRE TO OPEN AN
ACCOUNT
(bullet)
Call your investment
professional or, if you
trade directly through
Fidelity, call
1-800-843-3001 to set
up your account and to
arrange a wire
transaction.
(bullet)
Wire to: The Bank of
New York, Bank Routing
# 021000018, Account
# 8900118245.
(bullet)
Specify the complete
name of the fund, note
the applicable class, and
include your new fund
account number and
your name.
TO ADD TO AN
ACCOUNT
(bullet)
Call your investment
professional or, if you
trade directly through
Fidelity, call
1-800-843-3001 to
arrange a wire
transaction.
(bullet)
Wire to: The Bank of
New York, Bank Routing
# 021000018, Account
# 8900118245.
(bullet)
Specify the complete
name of the fund, note
the applicable class, and
include your fund
account number and
your name.
AUTOMATICAL TO OPEN AN ACCOUNT
LY (bullet)
Not available.
TO ADD TO AN
ACCOUNT
(bullet)
Use Fidelity Advisor
Systematic Exchange
Program to exchange
from Daily Money Class
of another fund offered
through this prospectus
or Class A or Class T of a
Fidelity Advisor fund.
SELLING SHARES
The price to sell one share of Daily Money Class is the class's NAV.
Your shares will be sold at the next NAV calculated after your order
is received in proper form.
It is the responsibility of your investment professional to transmit
your order to sell shares to Fidelity before the close of business on
the day you place your order.
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 30 days ;
(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, 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 $500 worth of shares in the account to keep it
open, except accounts not subject to account minimums.
(small solid bullet) You are advised to place your trades as early in
the day as possible and to provide Fidelity with advance notice of
large redemptions.
(small solid bullet) Normally, Fidelity will process wire redemptions
on the same business day, provided your redemption wire request is
received in proper form by Fidelity before the NAV is calculated on
that day. All other redemptions will normally be processed by the
next business day. However, Fidelity may take up to seven days to
process redemptions if making immediate payment would adversely affect
a 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) 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 assets rather than in cash if the Board of Trustees determines
it is in the best interests of a fund.
(small solid bullet) If you sell shares of Prime Fund, Treasury Fund
or Tax-Exempt Fund by writing a check and the amount of the check is
greater than the value of your account, your check will be returned to
you and you may be subject to additional charges.
(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.
KEY INFORMATION
PHONE (bullet)
1-800-843-3001 Call your investment
professional or, if you
trade directly through
Fidelity, call
1-800-843-3001 to
initiate a wire transaction
or to request a check for
your redemption.
(bullet)
Exchange to Daily Money
Class of another fund
offered through this
prospectus, to Class A or
Class T of a Fidelity
Advisor fund, or to other
Fidelity funds. Call your
investment professional
or, if you trade directly
through Fidelity, call
1-800-843-3001.
MAIL INDIVIDUAL, JOINT
FIDELITY TENANTS,
INVESTMENTS SOLE PROPRIETORSHIP,
P.O. BOX 770002 UGMA/UTMA
CINCINNATI, OH (bullet)
45277-0081 Send a letter of
instruction to your
investment professional
or, if you trade directly
through Fidelity, to the
address at left, including
your name, the fund's
name, the class 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
(bullet)
The account owner
should complete a
retirement distribution
form. Call your
investment professional
or, if you trade directly
through Fidelity, call
1-800-843-3001 to
request one.
TRUSTS
(bullet)
Send a letter of
instruction to your
investment professional
or, if you trade directly
through Fidelity, to the
address at left, including
the trust's name, the
fund's name, the class
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
(bullet)
Send a letter of
instruction to your
investment professional
or, if you trade directly
through Fidelity, to the
address at left, including
the firm's name, the
fund's name, the class
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.
(bullet)
Include a corporate
resolution with corporate
seal or a signature
guarantee.
EXECUTOR,
ADMINISTRATOR,
CONSERVATOR,
GUARDIAN
(bullet)
Call your investment
professional or, if you
trade directly through
Fidelity, call
1-800-843-3001 for
instructions.
IN PERSON INDIVIDUAL, JOINT
TENANTS,
SOLE PROPRIETORSHIP,
UGMA/UTMA
(bullet)
Bring a letter of
instruction to your
investment professional.
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
(bullet)
The account owner
should complete a
retirement distribution
form. Visit your
investment professional
to request one.
TRUSTS
(bullet)
Bring a letter of
instruction to your
investment professional.
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
(bullet)
Bring a letter of
instruction to your
investment professional.
At least one person
authorized by corporate
resolution to act on the
account must sign the
letter of instruction.
(bullet)
Include a corporate
resolution with corporate
seal or a signature
guarantee.
EXECUTOR,
ADMINISTRATOR,
CONSERVATOR,
GUARDIAN
(bullet)
Visit your investment
professional for
instructions.
AUTOMATICAL (bullet)
LY Use Fidelity Advisor
Systematic Exchange
Program to exchange to
Class A or Class T of a
Fidelity Advisor fund.
CHECK (bullet)
Write a check to sell
shares 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 Daily Money Class shareholder you have the privilege of
exchanging Daily Money Class shares of a fund.
If you have purchased Daily Money Class shares of a fund in connection
with the Fidelity Advisor funds program, your Daily Money Class shares
may be exchanged only for Class A or Class T shares, as applicable, of
Fidelity Advisor funds, or Daily Money Class shares of another fund
offered through this prospectus. Other shareholders may not exchange
Daily Money Class shares of a fund for Class A or Class T shares of
Fidelity Advisor funds but may exchange Daily Money Class shares of a
fund for Daily Money Class shares of another fund offered through this
prospectus and for shares of other Fidelity funds.
However, you should note the following policies and restrictions
governing exchanges:
(small solid bullet) The fund or class 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 or class, read its
prospectus.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Currently, there is no limit on the number of
exchanges out of a fund.
(small solid bullet) Each 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 funds may terminate or modify the exchange privileges in the
future.
Other funds may have different exchange restrictions, and may impose
administrative fees of up to 1.00% and trading fees of up to 3.00% 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
funds.
FIDELITY
ADVISOR
SYSTEMATIC
EXCHANGE
PROGRAM
TO MOVE
MONEY FROM
DAILY MONEY
CLASS TO CLASS
A OR CLASS T OF
A FIDELITY
ADVISOR FUND
MINIMUM FREQUENCY PROCEDURES
$100 Monthly, (bullet) To set up,
quarterly, call your investment
semi-annually, or professional or, if you
annually trade directly through
Fidelity, call
1-800-843-3001
after both accounts
are opened.
(bullet) To make
changes, call your
investment
professional directly
or, if you trade
directly through
Fidelity, call
1-800-843-3001.
Call at least 2
business days prior to
your next scheduled
exchange date.
(bullet) The
account from which
the exchanges are to
be processed must
have a minimum
balance of $10,000.
The account into
which the exchange is
being processed must
have a minimum
balance of $1,000.
OTHER FEATURES. The following other features are also available to buy
and sell shares of the funds.
WIRE
TO PURCHASE AND SELL SHARES VIA THE FEDERAL RESERVE WIRE SYSTEM.
(bullet) You must sign up for the Wire feature before using it.
Complete the appropriate section on the application when opening your
account.
(bullet) Call your investment professional or, if you trade directly
through Fidelity, call 1-800-843-3001 before your first use to verify
that this feature is set up on your account.
(bullet) To sell shares by wire, you must designate the U.S.
commercial bank account(s) into which you wish the redemption proceeds
deposited.
(bullet) To add the wire feature or to change the bank account
designated to receive redemption proceed s at any time prior to
making a redemption request , you should send a letter of
instruction, including a signature guarantee, to your investment
professional or, if you trade directly through Fidelity, to the
address found in "General Information."
CHECKWRITING
TO REDEEM SHARES FROM YOUR ACCOUNT.
(bullet) To set up, complete the appropriate section on the
application.
(bullet) All account owners must sign a signature card to receive a
checkbook.
(bullet) You may write an unlimited number of checks.
(bullet) Minimum check amount: $500.
(bullet) Do not try to close out your account by check.
(bullet) To obtain more checks, call your investment professional or,
if you trade directly through Fidelity, call 1-800-843-3001.
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 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, even if you have more than one account in
a fund. Call Fidelity at 1-888-622-3175 if you need additional
copies of financial reports or prospectuses. Call your
investment professional if you need historical account 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. Additional
documentation may be required from corporations, associations, and
certain fiduciaries.
When you sign your ACCOUNT APPLICATION, you will be asked to certify
that your social security or taxpayer identification number is correct
and that you are not subject to 31% backup withholding for failing to
report income to the IRS. If you violate IRS regulations, the IRS can
require a fund to withhold 31% of your taxable distributions and
redemptions.
If your ACCOUNT BALANCE falls below $500 (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 SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
Each fund earns interest, dividends and other income from its
investments, and distributes this income (less expenses) to
shareholders as dividends . Each fund may also realize capital
gains from its investments, and distributes these gains (less losses),
if any, to shareholders as capital gains d istributions .
Distributions you receive from each fund consist primarily of
dividends. Each fund normally declares dividends daily and pays them
monthly.
You may request to have dividends relating to Daily Money Class shares
redeemed from an account closed during the month paid when the account
is closed. Each fund reserves the right to limit this service.
EARNING DIVIDENDS
Daily Money Class shares purchased by a wire order prior to 4:00 p.m.
Eastern time for Prime Fund and Treasury Fund or prior to 12:00 noon
Eastern time for Tax-Exempt Fund, with receipt of the wire in proper
form before the close of the Federal Reserve Wire System on that day,
generally begin to earn dividends on the day of purchase.
Daily Money Class shares purchased by all other orders begin to earn
dividends on the first business day following the day of purchase.
However, on any day that the principal bond markets close early (as
recommended by the Bond Market Association) or the Kansas City Fed
for Tax-Exempt Fund or the New York Fed for Prime Fund and Treasury
Fund closes early, a class may advance the time on that day by
which wire purchase orders must be placed so that shares earn
dividends on the day of purchase.
In addition, on any day that the principal bond markets do not open
(as recommended by the Bond Market Association) or the Kansas City Fed
for Tax-Exempt Fund or the New York Fed for Prime Fund and Treasury
Fund does not open, shares begin to earn dividends on the first
business day following the day of purchase.
Daily Money Class shares redeemed by a wire order prior to 4:00 p.m.
Eastern time for Prime Fund and Treasury Fund or prior to 12:00 noon
Eastern time for Tax-Exempt Fund, generally earn dividends through the
day prior to the day of redemption.
Daily Money Class shares redeemed by all other orders earn dividends
until, but not including, the next business day following the day of
redemption.
However, on any day that the principal bond markets close early (as
recommended by the Bond Market Association) or the Kansas City Fed
for Tax-Exempt Fund or the New York Fed for Prime Fund and Treasury
Fund closes early, a class may set a time after which shares
redeemed by wire order earn dividends until, but not including, the
next business day following the day of redemption.
On any day that the principal bond markets do not open (as recommended
by the Bond Market Association) or the Kansas City Fed for Tax-Exempt
Fund or the New York Fed for Prime Fund and Treasury Fund does not
open, shares earn dividends until, but not including, the next
business day following the day of redemption.
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
Daily Money Class's distributions:
1. REINVESTMENT OPTION. Your dividends and capital gains
distributions, if any, will be automatically reinvested in additional
Daily Money Class shares of the fund. If you do not indicate a choice
on your application, you will be assigned this option.
2. CASH OPTION. Your dividends and capital gains distributions, if
any, will be 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, contact your investment
professional directly or 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 a fund could have tax
consequences for you. If you are not investing through a
tax-advantaged retirement account, you should consider these tax
consequences.
Distributions you receive from Prime Fund and Treasury Fund are
subject to federal income tax, and may also be subject to state or
local taxes.
Tax-Exempt Fund seeks to earn income and pay dividends exempt from
federal income tax. Income exempt from federal income tax may be
subject to state or local taxes. A portion of Tax-Exempt Fund's
income, and the dividends you receive, may be subject to federal and
state income taxes. Tax-Exempt Fund may also realize taxable income or
gains on the sale of municipal bonds and may make taxable
distributions.
For federal tax purposes, Prime Fund's and Treasury Fund's dividends,
Tax-Exempt Fund's distributions of gains on bonds characterized as
market discount, and each fund's distributions of short-term capital
gains are taxable to you as ordinary income. Each fund's distributions
of long-term capital gains, if any, are taxable to you generally as
capital gains .
Any taxable distributions you receive from a fund will normally be
taxable to you when you receive them, regardless of your distribution
option. If you elect to receive distributions in cash, you will
receive certain December distributions in January, but those
distributions will be taxable as if you received them on December 31.
FUND SERVICES
FUND MANAGEMENT
Each fund is a mutual fund, an investment that pools
shareholders' money and invests it toward a specified goal.
Fidelity Management & Research Company (FMR) is each fund's manager.
As of April 30, 1998, FMR had approximately $52 9 billion in
discretionary assets under management.
As the manager, FMR is responsible for choosing the funds' investments
and handling their business affairs.
Fidelity Investments Money Management, Inc. (FIMM), in Merrimack, New
Hampshire, is an affiliate of FMR and serves as sub-adviser for each
fund. As of May 1, 1998, FIMM had approximately $99 billion in
discretionary assets under management. FIMM is primarily responsible
for choosing investments for each fund.
A fund could be adversely affected if the computer systems used by FMR
and other service providers do not properly process and calculate
date-related information from and after January 1, 2000. FMR has
advised each fund that it is actively working on necessary changes to
its computer systems and expects that its systems, and those of other
major service providers, will be modified prior to January 1, 2000.
However, there can be no assurance that there will be no adverse
impact on a fund.
Fidelity investment personnel may invest in securities for their own
investment accounts pursuant to a code of ethics that establishes
procedures for personal investing and restricts certain transactions.
Each fund pays a management fee to FMR.
The management fee is calculated and paid to FMR every month.
Each fund's annual management fee rate is 0.25% of its average net
assets.
FMR pays FIMM for providing assistance with investment advisory
services.
FUND DISTRIBUTION
Each fund is composed of multiple classes of shares. All classes of a
fund have a common investment objective and investment portfolio.
Fidelity Distributors Corporation (FDC) distributes Daily Money
Class's shares.
Your Daily Money Class shares purchased by exchange from Class A or
Class T shares of an Advisor Fund are subject to any contingent
deferred sales charge to which the Class A or Class T shares that you
exchanged for Daily Money Class shares would have been subject.
Daily Money Class of each fund has adopted a Distribution and Service
Plan pursuant to Rule 12b-1 under the Investment Company Act of 1940.
Under the plan, Daily Money Class of each fund is authorized to pay
FDC a monthly 12b-1 fee as compensation for providing services
intended to result in the sale of Daily Money Class shares and/or
shareholder support services. Daily Money Class of each fund currently
pays FDC a monthly 12b-1 fee at an annual rate of 0.25% of its average
net assets throughout the month.
FDC may reallow to intermediaries, such as banks, broker-dealers and
other service-providers up to an annual rate of 0.25% of average net
assets they maintain, for providing services intended to result in the
sale of Daily Money Class shares and/or shareholder support services.
Intermediaries that maintain an aggregate balance of at least $50,000
in Daily Money Class shares are eligible for compensation.
Because 12b-1 fees are paid out of Daily Money Class's assets on an
ongoing basis, they will increase the cost of your investment and may
cost you more than paying other types of sales charges.
In addition, each Daily Money Class plan specifically
recognize s that FMR may make payments from its management fee
revenue, past profits, or other resources to FDC for expenses incurred
in connection with providing services intended to result in the sale
of Daily Money Class shares and/or shareholder support services,
including payments made to intermediaries that provide those services.
Currently, the Board of Trustees of each fund has authorized such
payments to intermediaries at an annual rate of up to 0.10% of the
average net assets they maintain.
Independent of the Daily Money Class plans, intermediaries that
maintain an average balance of $10 million or more in a single omnibus
account may receive an additional recordkeeping fee of up to 0.15% of
the average net assets they maintain. The recordkeeping fee will be
paid by FMR or its affiliates, not by the funds, and will not be paid
for distribution services.
To receive payments made pursuant to a Distribution and Service Plan
or record keeping fees, intermediaries 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 a 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
Statement of Additional Information (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 funds or FDC. This Prospectus and the related SAI do
not constitute an offer by the funds or by FDC to sell or to buy
shares of the funds to any person to whom it is unlawful to make such
offer.
APPENDIX
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand
Daily Money Class's financial history for the past five years.
Certain information reflects financial results for a single class
share. Total returns for each period include the reinvestment of all
dividends and distributions. This information has been audited by
PricewaterhouseCoopers LLP , independent accountants, whose report,
along with each fund's financial highlights and financial statements,
are included in the funds' Annual Report. A free copy of the Annual
Report is available upon request.
PRIME FUND - DAILY MONEY CLASS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER-SHARE
DATA AND RATIOS
YEARS ENDED 1998 1997 1996E 1996F 1995F 1994F
OCTOBER 31
NET ASSET VALUE, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
BEGINNING OF PERIOD
INCOME FROM
INVESTMENT
OPERATIONS
NET INVESTMENT .050 .050 .012 .050 .050 .029
INCOME
LESS DISTRIBUTIONS
FROM NET (.050) (.050) (.012) (.050) (.050) (.029)
INVESTMENT INCOME
NET ASSET VALUE, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
END OF PERIOD
TOTAL RETURNB,C 5.15% 5.06% 1.22% 5.13% 5.16% 2.98%
NET ASSETS, END $ 3,397 $ 2,687 $ 2,663 $ 2,581 $ 2,139 $ 1,525
OF PERIOD
(IN MILLIONS)
RATIO OF .65%D .65%D .65%A,D .65%D .65%D .65%D
EXPENSES TO AVERAGE
NET ASSETS
RATIO OF NET 5.03% 4.95% 4.85%A 5.00% 5.11% 2.96%
INVESTMENT INCOME
TO AVERAGE NET
ASSETS
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS'S EXPENSES DURING
THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
E THREE MONTHS ENDED OCTOBER 31
F YEAR ENDED JULY 31
TREASURY FUND - DAILY MONEY CLASS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
SELECTED
PER-SHARE DATA AND
RATIOS
YEARS ENDED 1998 1997 1996E 1996F 1995F 1994F
OCTOBER 31
NET ASSET VALUE, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
BEGINNING OF PERIOD
INCOME FROM
INVESTMENT
OPERATIONS
NET INVESTMENT .049 .049 .012 .049 .049 .029
INCOME
LESS DISTRIBUTIONS
FROM NET (.049) (.049) (.012) (.049) (.049) (.029)
INVESTMENT INCOME
NET ASSET VALUE, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
END OF PERIOD
TOTAL RETURNB,C 5.04% 4.97% 1.19% 5.06% 5.02% 2.89%
NET ASSETS, END $ 1,261 $ 1,284 $ 1,801 $ 1,801 $ 1,828 $ 2,025
OF PERIOD
(IN MILLIONS)
RATIO OF .65%D .65%D .65%A,D .65%D .65%D .60%
EXPENSES TO AVERAGE
NET ASSETS
RATIO OF NET 4.93% 4.88% 4.66%A 4.94% 4.89% 2.81%
INVESTMENT INCOME
TO AVERAGE NET
ASSETS
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS'S EXPENSES DURING
THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
E THREE MONTHS ENDED OCTOBER 31
F YEAR ENDED JULY 31
TAX-EXEMPT FUND - DAILY MONEY CLASS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
SELECTED
PER-SHARE DATA AND
RATIOS
YEARS ENDED 1998 1997 1996 1995 1994
OCTOBER 31
NET ASSET VALUE, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
BEGINNING OF PERIOD
INCOME FROM
INVESTMENT
OPERATIONS
NET INVESTMENT .030 .031 .030 .033 .022
INCOME
LESS DISTRIBUTIONS
FROM NET (.030) (.031) (.030) (.033) (.022)
INVESTMENT INCOME
NET ASSET VALUE, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
END OF PERIOD
TOTAL RETURNA 3.03% 3.10% 3.02% 3.36% 2.21%
NET ASSETS, END $ 519 $ 469 $ 500 $ 559 $ 454
OF PERIOD (IN
MILLIONS)
RATIO OF .65%B .65%B .65%B .65%B .65%B
EXPENSES TO AVERAGE
NET ASSETS
RATIO OF NET 2.99% 3.06% 2.98% 3.31% 2.17%
INVESTMENT INCOME
TO AVERAGE
NET ASSETS
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
B FMR AGREED TO REIMBURSE A PORTION OF THE CLASS'S EXPENSES DURING
THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
You can obtain additional information about the funds. The funds'
SAI includes more detailed information about each fund and its
investments. The SAI is incorporated herein by reference (legally
forms a part of the prospectus). Each fund's annual and semi-annual
reports include a discussion of the fund's holdings and
performance.
For a free copy of any of these documents or to request other
information or ask questions about a fund, call Fidelity at
1-8 88-622-3175 .
The SAI, the funds' annual and semi-annual reports and other related
materials are available on the SEC's Internet Web site
(http://www.sec.gov). You can obtain copies of this information upon
paying a duplicating fee, by writing the Public Reference Section of
the SEC, Washington, D.C. 20549-6009. You can also review and copy
information about the funds, including the funds' SAI, at the SEC's
Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for
information on the operation of the SEC's Public Reference Room.
INVESTMENT COMPANY ACT OF 1940, FILE NUMBER 2-78458
Fidelity, Fidelity Investments, Fidelity Investments & (Pyramid)
Design, and the Pyramid Design are registered trademarks of FMR Corp.
1.702675.101 DMFI-pro-1298
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
CASH MANAGEMENT
FUNDS
PRIME FUND - CAPITAL RESERVES CLASS
(fund number 076)
TREASURY FUND - CAPITAL RESERVES CLASS
(fund number 077)
TAX-EXEMPT FUND - CAPITAL RESERVES CLASS
(fund number 079)
PROSPECTUS
DECEMBER 30, 1998(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON,
MA 02109
CONTENTS
FUND SUMMARY 2 INVESTMENT SUMMARY
3 PERFORMANCE
3 FEE TABLE
FUND BASICS 4 INVESTMENT DETAILS
5 VALUING SHARES
SHAREHOLDER INFORMATION 5 BUYING AND SELLING SHARES
16 EXCHANGING SHARES
16 ACCOUNT FEATURES AND POLICIES
17 DIVIDENDS AND CAPITAL GAINS
DISTRIBUTIONS
18 TAX CONSEQUENCES
FUND SERVICES 18 FUND MANAGEMENT
18 FUND DISTRIBUTION
APPENDIX 19 FINANCIAL HIGHLIGHTS
FUND SUMMARY
INVESTMENT SUMMARY
INVESTMENT OBJECTIVE
PRIME FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
Fidelity Management and Research Company (FMR)'s principal investment
strategies include:
(small solid bullet) Investing in U.S. dollar-denominated money market
securities of domestic and foreign issuers rated in the highest
category by at least two nationally - recognized rating services,
U.S. Government securities and repurchase agreements and entering into
reverse repurchase agreements.
(small solid bullet) Investing more than 25% of total assets in the
financial services industry.
(small solid bullet) Generally maintaining a dollar-weighted
average maturity at 60 days or less.
(small solid bullet) Investing in compliance with industry-standard
requirements for money market funds for the quality, maturity and
diversification of investments.
PRINCIPAL INVESTMENT RISKS
The fund is subject to the following principal investment risks:
(small solid bullet) INTEREST RATE CHANGES. Interest rate increases
can cause the price of a money market security to decrease.
(small solid bullet) FOREIGN EXPOSURE. Entities located in foreign
countries can be affected by adverse political, regulatory, market or
economic developments in those countries.
(small solid bullet) FINANCIAL SERVICES EXPOSURE. Changes in
government regulation or economic downturns can have a significant
negative affect on issuers in the financial services sector.
(small solid bullet) ISSUER-SPECIFIC CHANGES. A decline in the credit
quality of an issuer or the provider of credit support or a
maturity-shortening structure for a security can cause the price of a
money market security to decrease.
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. Although the fund seeks to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in the fund.
INVESTMENT OBJECTIVE
TREASURY FUND seeks to obtain as high a level of current income
as is consistent with the preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing in U.S. Treasury securities and
repurchase agreements for those securities.
(small solid bullet) Generally maintaining a dollar-weighted
average maturity at 60 days or less.
(small solid bullet) Investing in compliance with industry-standard
requirements for money market funds for the quality, maturity and
diversification of investments.
PRINCIPAL INVESTMENT RISKS
The fund is subject to the following principal investment risks:
(small solid bullet) INTEREST RATE CHANGES. Interest rate increases
can cause the price of a money market security to decrease.
(small solid bullet) ISSUER-SPECIFIC CHANGES. A decline in the credit
quality of an issuer or the provider of credit support or a
maturity-shortening structure for a security can cause the price of a
money market security to decrease.
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. Although the fund seeks to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in the fund.
INVESTMENT OBJECTIVE
TAX-EXEMPT FUND seeks to provide as high a level of current income,
exempt from federal income taxes, as is consistent with liquidity and
stability of principal.
PRINCIPAL INVESTMENT STRATEGIES
FMR's principal investment strategies include:
(small solid bullet) Investing normally in municipal money
market securities.
(small solid bullet) Investing so that at least 80% of the fund's
income distributions is exempt from federal income tax.
(small solid bullet) Normally not investing in municipal securities
whose interest is subject to federal income tax or in municipal
securities whose interest is subject to the federal alternative
minimum tax.
(small solid bullet) Potentially investing more than 25% of total
assets in municipal securities that finance similar types of
projects.
(small solid bullet) Investing in compliance with industry-standard
requirements for money market funds for the quality, maturity and
diversification of investments.
PRINCIPAL INVESTMENT RISKS
The fund is subject to the following principal investment risks:
(small solid bullet) MUNICIPAL MARKET VOLATILITY. The municipal market
is volatile and can be significantly affected by adverse tax,
legislative or political changes and the financial condition of the
issuers of municipal securities.
(small solid bullet) INTEREST RATE CHANGES. Interest rate increases
can cause the price of a money market security to decrease.
(small solid bullet) FOREIGN EXPOSURE. Entities located in foreign
countries can be affected by adverse political, regulatory, market or
economic developments in those countries.
(small solid bullet) ISSUER-SPECIFIC CHANGES. A decline in the credit
quality of an issuer or the provider of credit support or a
maturity-shortening structure for a security can cause the price of a
money market security to decrease.
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. Although the fund seeks to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in the fund.
PERFORMANCE
Because Capital Reserves Class of Prime Fund, Treasury Fund and
Tax-Exempt Fund was new when this prospectus was printed, its
performance history is not included. Performance history will be
available for Capital Reserves Class of Prime Fund, Treasury Fund and
Tax-Exempt Fund after Capital Reserves Class of each fund has been in
operation for one calender year.
FEE TABLE
The following table describes the fees and expenses that are incurred
when you buy, hold or sell Capital Reserves Class shares of a fund.
The annual class operating expenses provided below for Capital
Reserves Class are higher than the expenses actually paid by
the class as the result of expense reimbursements during the
period.
SHAREHOLDER FEES (PAID BY THE INVESTOR DIRECTLY)
SALES CHARGE (LOAD) ON NONE
PURCHASES AND
REINVESTED DISTRIBUTIONS
DEFERRED SALES CHARGE NONE
(LOAD) ON REDEMPTIONS
ANNUAL CLASS OPERATING EXPENSES (PAID FROM CLASS ASSETS )
PRIME FUND MANAGEMENT FEE 0.25%
DISTRIBUTION AND SERVICE 0.50%
(12B-1) FEE
OTHER EXPENSES 0.26%
TOTAL ANNUAL CLASS 1.01%
OPERATING EXPENSESA
TREASURY FUND MANAGEMENT FEE 0.25%
DISTRIBUTION AND SERVICE 0.50%
(12B-1) FEE
OTHER EXPENSES 0.26%
TOTAL ANNUAL CLASS 1.01%
OPERATING EXPENSESA
TAX-EXEMPT MANAGEMENT FEE 0.25%
FUND
DISTRIBUTION AND SERVICE 0.50%
(12B-1) FEE
OTHER EXPENSES 0.29%
TOTAL ANNUAL CLASS 1.04%
OPERATING EXPENSESA
A FMR HAS VOLUNTARILY AGREED TO REIMBURSE CAPITAL RESERVES CLASS OF
EACH FUND TO THE EXTENT THAT TOTAL OPERATING EXPENSES ( EXCLUDING
INTEREST, TAXES, BROKERAGE COMMISSIONS AND EXTRAORDINARY
EXPENSES ), AS A PERCENTAGE OF THEIR RESPECTIVE AVERAGE NET ASSETS,
EXCEED 0.90%. THESE ARRANGEMENTS CAN BE TERMINATED BY FMR AT ANY TIME.
Long-term shareholders may pay more than the economic equivalent of
the maximum sales charges permitted by the National Association of
Securities Dealers, Inc., due to 12b-1 fees.
Each fund has entered into arrangements with its custodian and
transfer agent whereby credits realized as a result of uninvested cash
balances are used to reduce custodian and transfer agent expenses.
This EXAMPLE helps you compare the cost of investing in the funds with
the cost of investing in other mutual funds.
Let's say, hypothetically, that Capital Reserves Class's annual return
is 5% and that your shareholder fees and Capital Reserves Class'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 after the number
of years indicated:
PRIME FUND 1 YEAR $ 103
3 YEARS $ 322
5 YEARS $ 558
10 YEARS $ 1,236
TREASURY FUND 1 YEAR $ 103
3 YEARS $ 322
5 YEARS $ 558
10 YEARS $ 1,236
TAX-EXEMPT 1 YEAR $ 106
FUND
3 YEARS $ 331
5 YEARS $ 574
10 YEARS $ 1,271
FUND BASICS
INVESTMENT DETAILS
INVESTMENT OBJECTIVE
PRIME FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
FMR invests the fund's assets in U.S. dollar-denominated money market
securities of domestic and foreign issuers rated in the highest
category by at least two nationally recognized rating services, U.S.
Government securities and repurchase agreements. FMR also may enter
into reverse repurchase agreements for the fund.
FMR will invest more than 25% of the fund's total assets in the
financial services industry.
FMR generally intends to maintain the fund's
dollar-weighted average maturity a t 60 days or less.
In buying and selling securities for the fund, FMR complies with
industry-standard requirements for money market funds regarding the
quality, maturity and diversification of the fund's investments. FMR
stresses maintaining a stable $1.00 share price, liquidity and income.
INVESTMENT OBJECTIVE
TREASURY FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
FMR invests the fund's assets in U.S. Treasury securities and
repurchase agreements for those securities. FMR does not enter into
reverse repurchase agreements for the fund.
FMR generally intends to maintain the fund's
dollar-weighted average maturity at 60 days or less.
In buying and selling securities for the fund, FMR complies with
industry-standard requirements for money market funds regarding the
quality, maturity and diversification of the fund's investments. FMR
stresses maintaining a stable $1.00 share price, liquidity and income.
INVESTMENT OBJECTIVE
TAX-EXEMPT FUND seeks to provide as high a level of current income,
exempt from federal income taxes, as is consistent with liquidity and
stability of principal.
PRINCIPAL INVESTMENT STRATEGIES
FMR normally invests the fund's assets in municipal money market
securities.
FMR normally invests the fund's assets so that at least 80% of the
fund's income distributions is exempt from federal income tax. FMR
does not currently intend to invest the fund's assets in municipal
securities whose interest is subject to federal income tax or in
municipal securities whose interest is subject to the federal
alternative minimum tax.
FMR may invest more than 25% of the fund's total assets in securities
that finance similar projects, such as those relating to education,
health care, transportation and utilities.
In buying and selling securities for the fund, FMR complies with
industry-standard requirements for money market funds regarding the
quality, maturity and diversification of the fund's investments. FMR
stresses maintaining a stable $1.00 share price, liquidity and income.
DESCRIPTION OF PRINCIPAL SECURITY TYPES
MONEY MARKET SECURITIES are high quality, short-term debt securities
that pay a fixed, variable or floating interest rate. Securities are
often specifically structured so that they are eligible investments
for a money market fund. For example, in order to satisfy the maturity
restrictions for a money market fund, some money market securities
have demand or put features which have the effect of shortening the
security's maturity. Taxable money market securities include bank
certificates of deposit, bank acceptances , bank time
deposits, notes, commercial paper and U.S. Government securities.
Municipal money market securities include variable rate demand notes,
commercial paper and municipal notes.
U.S. GOVERNMENT SECURITIES are high quality securities issued or
guaranteed by the U.S. Treasury or by an agency or instrumentality of
the U.S. Government. U.S. Government securities may be backed by the
full faith and credit of the U.S. Treasury, the right to borrow from
the U.S. Treasury, or the agency or instrumentality issuing or
guaranteeing the security.
MUNICIPAL SECURITIES are issued to raise money for a variety of public
and private purposes, including general financing for state and local
governments, or financing for a specific project or public facility.
Municipal securities may be fully or partially backed by the local
government, by the credit of a private issuer, by the current or
anticipated revenues from a specific project or specific assets, or by
domestic or foreign entities providing credit support such as letters
of credit, guarantees or insurance.
A REPURCHASE AGREEMENT is an agreement to buy a security at one
price and simultaneous agreement to sell it back at a n
agreed-upon price.
PRINCIPAL INVESTMENT RISKS
Many factors affect each fund's performance. A fund's yield will
change daily based on changes in interest rates and other market
conditions. Although each fund is managed to maintain a stable $1.00
share price, there is no guarantee that the fund will be able to do
so. For example, a major increase in interest rates or a decrease in
the credit quality of the issuer of one of a fund's investments
could cause the fund's share price to decrease. While the funds
will be charged premiums by a mutual insurance company for coverage of
specified types of losses related to default or bankruptcy on certain
securities, a fund may incur losses regardless of the insurance.
It is important to note that neither the funds nor their yields
are guaranteed by the U.S. Government.
The following factors may significantly affect a fund's performance:
MUNICIPAL MARKET VOLATILITY. Municipal securities can be
significantly affected by political changes as well as uncertainties
in the municipal market related to taxation, legislative changes, or
the rights of municipal security holders. Because many municipal
securities are issued to finance similar types of projects, especially
those relating to education, health care, transportation and
utilities, conditions in those sectors can affect the overall
municipal market. In addition, changes in the financial condition of
an individual municipal insurer can affect the overall municipal
market.
INTEREST RATE CHANGES. Money market securities have varying levels of
sensitivity to changes in interest rates. In general, the price of a
money market security can fall when interest rates rise and can rise
when interest rates fall. Securities with longer maturities and the
securities of issuers in the financial services industry can be more
sensitive to interest rate changes. Short-term securities tend to
react to changes in short-term interest rates.
FOREIGN EXPOSURE. Issuers located in foreign countries and entities
located in foreign countries that provide credit support or a
maturity-shortening structure can involve increased risks. Extensive
public information about the issuer or provider may not be available
and unfavorable political, economic or governmental developments could
affect the value of the security.
FINANCIAL SERVICES EXPOSURE. Financial services companies are
highly dependent on the supply of short-term financing. The
value of securities of issuers in the financial services sector can be
sensitive to changes in government regulation and interest rates and
to economic downturns in the United States and abroad.
ISSUER-SPECIFIC CHANGES. Changes in the financial condition of an
issuer, changes in specific economic or political conditions that
affect a particular type of issuer, and changes in general economic or
political conditions can affect the credit quality or value of an
issuer's securities. Entities providing credit support or a
maturity-shortening structure also can be affected by these types of
changes. Municipal securities backed by current or anticipated
revenues from a specific project or specific assets can be negatively
affected by the discontinuance of the taxation supporting the project
or assets or the inability to collect revenues for the project or from
the assets. If the Internal Revenue Service determines an issuer of
a municipal security has not complied with applicable tax
requirements, interest from the security could become taxable and the
security could decline significantly in value. In addition, if the
structure of a security fails to function as intended,
interest from the security could become taxable or the
security could decline in value.
In response to market, economic, political or other conditions, FMR
may temporarily use a different investment strategy for Tax-Exempt
Fund for defensive purposes. If FMR does so, different factors
could affect Tax-Exempt Fund 's performance, and the fund
may distribute income subject to federal income tax.
FUNDAMENTAL INVESTMENT POLICIES
The policies below are fundamental, that is, subject to change only by
shareholder approval.
PRIME FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
TREASURY FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
TAX-EXEMPT FUND seeks to provide individual and institutional
investors with as high a level of current income, exempt from federal
income taxes, as is consistent with a portfolio of high quality,
short-term municipal obligations selected on the basis of liquidity
and stability of principal. The fund normally invests so that at least
80% of its income distributions is free from federal income tax.
VALUING SHARES
The funds are open for business each day the New York Stock Exchange
(NYSE) is open.
A class's net asset value per share (NAV) is the value of a single
share. Fidelity (registered trademark) normally calculates
Capital Reserves Class'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 ) . Each fund's
assets are valued as of this time for the purpose of computing Capital
Reserves Class's NAV.
To the extent that each 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 a fund's assets may not occur on days when the fund
is open for business.
Each fund's assets are valued on the basis of amortized cost.
SHAREHOLDER INFORMATION
BUYING AND SELLING SHARES
GENERAL INFORMATION
For account, product and service information, please call
1-800-843-3001 (8:30 a.m.-7:00 p.m. Eastern time, Monday through
Friday).
Please use the following addresses:
BUYING OR SELLING SHARES
Fidelity Investments
P.O. Box 770002
Cincinnati, OH 45277-0081
OVERNIGHT EXPRESS
Fidelity Investments
2300 Litton Lane - KH2A
Hebron, KY 41048
You may buy or sell Capital Reserves Class shares of the funds through
a retirement account or an investment professional. When you invest
through a retirement account or an investment professional, the
procedures for buying, selling and exchanging Capital Reserves Class
shares of a fund and the account features and policies may differ.
Additional fees may also apply to your investment in Capital Reserves
Class shares of a fund, including a transaction fee if you buy or sell
Capital Reserves Class shares of a fund through a broker or other
investment professional.
Certain methods of contacting Fidelity, such as by telephone, may be
unavailable or delayed (for example, during periods of unusual market
activity).
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) ROTH CONVERSION IRAS
(solid bullet) ROLLOVER IRAS
(solid bullet) 401(K) PLANS, AND CERTAIN OTHER 401(A)-QUALIFIED PLANS
(solid bullet) SIMPLE IRAS
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS)
(solid bullet) SALARY REDUCTION SEP-IRAS (SARSEPS)
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
The price to buy one share of Capital Reserves Class is the class's
NAV.
Your shares will be bought at the next NAV calculated after your order
is received in proper form.
It is the responsibility of your investment professional to transmit
your order to buy shares to Fidelity before the close of business on
the day you place your order.
Short-term or excessive trading into and out of a fund may harm
performance by disrupting portfolio management strategies and by
increasing expenses. Accordingly, a 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
that fund. For these purposes, FMR may consider an investor's trading
history in that fund or other Fidelity funds, and accounts under
common ownership or control.
Each 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) You are advised to place your trades as early in
the day as possible and to provide Fidelity with advance notice of
large purchases.
(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 a fund or
Fidelity has incurred.
(small solid bullet) If when you place your wire purchase order you
indicate that Fidelity will receive your wire that day, your wire must
be received in proper form by Fidelity at the applicable fund's
designated wire bank before the close of the Federal Reserve Wire
System on the day of purchase.
Capital Reserves Class shares can be bought or sold through
investment professionals using an automated order placement and
settlement system that guarantees payment for orders on a specified
date.
MINIMUMS
TO OPEN AN ACCOUNT $1,000
For certain Fidelity retirement accountsA $500
TO ADD TO AN ACCOUNT $250
For certain Fidelity retirement accountsA $100
Through regular investment plans $100
MINIMUM BALANCE $500
A FIDELITY TRADITIONAL IRA, ROTH IRA, ROTH CONVERSION IRA, ROLLOVER
IRA, SEP-IRA, AND KEOGH ACCOUNTS.
There is no minimum account balance or initial or subsequent purchase
minimum for certain Fidelity retirement accounts funded through salary
deduction, or accounts opened with the proceeds of distributions from
such retirement accounts. In addition, each fund may waive or lower
purchase minimums in other circumstances.
KEY INFORMATION
PHONE TO OPEN AN
1-800-843- ACCOUNT
3001 (bullet)
Exchange
from Capital
Reserves
Class of
another fund
offered
through this
prospectus
or from
another
Fidelity
fund. Call
your
investment
professional
or, if you
trade
directly
through
Fidelity,
call
1-800-843-30
01.
TO ADD TO AN
ACCOUNT
(bullet)
Exchange
from Capital
Reserves
Class of
another fund
offered
through this
prospectus
or from
another
Fidelity
fund. Call
your
investment
professional
or, if you
trade
directly
through
Fidelity,
call
1-800-843-30
01.
MAIL TO OPEN AN
FIDELITY ACCOUNT
INVESTMENT (bullet)
S Complete
P.O. BOX and sign
770002 the
CINCINNATI application
, OH . Make your
45277-0081 check
payable to
the
complete
name of the
fund and
note the
applicable
class. Mail
to your
investment
professiona
l or, if
you trade
directly
through
Fidelity,
to the
address at
left.
TO ADD TO AN
ACCOUNT
(bullet)
Make your
check
payable to
the
complete
name of the
fund and
note the
applicable
class.
Include
your fund
account
number on
your check
and mail to
your
investment
professiona
l or, if
you trade
directly
through
Fidelity,
to the
address at
left.
(bullet)
Exchange
from Capital
Reserves
Class of
another fund
offered
through this
prospectus
or from
another
Fidelity
fund. Send a
letter of
instruction
to your
investment
professional
or, if you
trade
directly
through
Fidelity,
to the
address at
left,
including
your name,
the funds'
names, the
applicable
class names,
the fund
account
numbers, and
the dollar
amount or
number of
shares to be
exchanged.
IN PERSON TO OPEN AN
ACCOUNT
(bullet)
Bring your
application
and check
to your
investment
professiona
l.
TO ADD TO AN
ACCOUNT
(bullet)
Bring your
check to
your
investment
professiona
l.
WIRE TO OPEN AN
ACCOUNT
(bullet)
Call your
investment
professiona
l or, if
you trade
directly
through
Fidelity,
call
1-800-843-3
001 to set
up your
account and
to arrange
a wire
transaction
.
(bullet)
Wire to:
The Bank of
New York,
Bank
Routing #
021000018,
Account #
8900118245.
(bullet)
Specify the
complete
name of the
fund, note
the
applicable
class, and
include
your new
fund
account
number and
your name.
TO ADD TO AN
ACCOUNT
(bullet)
Call your
investment
professiona
l or, if
you trade
directly
through
Fidelity,
call
1-800-843-3
001 to
arrange a
wire
transaction
.
(bullet)
Wire to:
The Bank of
New York,
Bank
Routing #
021000018,
Account #
8900118245.
(bullet)
Specify the
complete
name of the
fund, note
the
applicable
class, and
include
your fund
account
number and
your name.
SELLING SHARES
The price to sell one share of Capital Reserves Class is the class's
NAV.
Your shares will be sold at the next NAV calculated after your order
is received in proper form.
It is the responsibility of your investment professional to transmit
your order to sell shares to Fidelity before the close of business on
the day you place your order.
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 30 days;
(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, 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 $500 worth of shares in the account to keep it
open, except accounts not subject to account minimums.
(small solid bullet) You are advised to place your trades as early in
the day as possible and to provide Fidelity with advance notice of
large redemptions.
(small solid bullet) Normally, Fidelity will process wire redemptions
on the same business day, provided your redemption wire request is
received in proper form by Fidelity before the NAV is calculated on
that day. All other redemptions will normally be processed by the next
business day. However, Fidelity may take up to seven days to process
redemptions if making immediate payment would adversely affect a 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) 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 assets rather than in cash if the Board of Trustees determines
it is in the best interests of a fund.
(small solid bullet) If you sell shares of Prime Fund, Treasury Fund
or Tax-Exempt Fund by writing a check and the amount of the check is
greater than the value of your account, your check will be returned to
you and you may be subject to additional charges.
(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.
KEY INFORMATION
PHONE (bullet)
1-800-843- Call your
3001 investment
professional
or, if you
trade
directly
through
Fidelity,
call
1-800-843-30
01 to
initiate a
wire
transaction
or to
request a
check for
your
redemption.
(bullet)
Exchange to
Capital
Reserves
Class of
another fund
offered
through this
prospectus
or to other
Fidelity
funds. Call
your
investment
professional
or, if you
trade
directly
through
Fidelity,
call
1-800-843-30
01.
MAIL INDIVIDUAL,
FIDELITY JOINT TENANTS,
INVESTMENT SOLE PROPRIETO
S RSHIP,
P.O. BOX UGMA/UTMA
770002 (bullet)
CINCINNATI Send a
, OH letter of
45277-0081 instruction
to your
investment
professiona
l or, if
you trade
directly
through
Fidelity,
to the
address at
left,
including
your name,
the fund's
name, the
class 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
(bullet)
The account
owner
should
complete a
retirement
distributio
n form.
Call your
investment
professiona
l or, if
you trade
directly
through
Fidelity,
call
1-800-843-3
001 to
request
one.
TRUSTS
(bullet)
Send a
letter of
instruction
to your
investment
professiona
l or, if
you trade
directly
through
Fidelity,
to the
address at
left,
including
the trust's
name, the
fund's
name, the
class 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
(bullet)
Send a
letter of
instruction
to your
investment
professiona
l or, if
you trade
directly
through
Fidelity,
to the
address at
left,
including
the firm's
name, the
fund's
name, the
class 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
.
(bullet)
Include a
corporate
resolution
with
corporate
seal or a
signature
guarantee.
EXECUTOR,
ADMINISTRATOR,
CONSERVATOR,
GUARDIAN
(bullet)
Call your
investment
professiona
l or, if
you trade
directly
through
Fidelity,
call
1-800-843-3
001 for
instruction
s.
IN PERSON INDIVIDUAL,
JOINT TENANTS,
SOLE PROPRIETO
RSHIP,
UGMA/UTMA
(bullet)
Bring a
letter of
instruction
to your
investment
professiona
l. 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
(bullet)
The account
owner
should
complete a
retirement
distributio
n form.
Visit your
investment
professiona
l to
request
one.
TRUSTS
(bullet)
Bring a
letter of
instruction
to your
investment
professiona
l. 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
(bullet)
Bring a
letter of
instruction
to your
investment
professiona
l. At least
one person
authorized
by
corporate
resolution
to act on
the account
must sign
the letter
of
instruction
.
(bullet)
Include a
corporate
resolution
with
corporate
seal or a
signature
guarantee.
EXECUTOR,
ADMINISTRATOR,
CONSERVATOR,
GUARDIAN
(bullet)
Visit your
investment
professiona
l for
instruction
s.
CHECK (bullet)
Write a
check to
sell shares
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 Capital Reserves Class shareholder you have the privilege of
exchanging Capital Reserves Class shares of a fund for Capital
Reserves Class shares of another fund offered through this prospectus
and for shares of other Fidelity funds.
However, you should note the following policies and restrictions
governing exchanges:
(small solid bullet) The fund or class 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 or class, read its
prospectus.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Currently, there is no limit on the number of
exchanges out of a fund.
(small solid bullet) Each 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 funds may terminate or modify the exchange privileges in the
future.
Other funds may have different exchange restrictions, and may impose
administrative fees of up to 1.00% and trading fees of up to 3.00% 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
funds.
WIRE
TO PURCHASE AND SELL SHARES VIA THE FEDERAL RESERVE WIRE SYSTEM.
(bullet) You must sign up for the Wire feature before using it.
Complete the appropriate section on the application when opening your
account.
(bullet) Call your investment professional or, if you trade directly
through Fidelity, call 1-800-843-3001 before your first use to verify
that this feature is set up on your account.
(bullet) To sell shares by wire, you must designate the U.S.
commercial bank account(s) into which you wish the redemption proceeds
deposited.
(bullet) To add the wire feature or to change the bank account
designated to receive redemption proceeds at any time prior to
making a redemption request , you should send a letter of
instruction, including a signature guarantee, to your investment
professional or, if you trade directly through Fidelity, to the
address found in "General Information."
CHECKWRITING
TO REDEEM SHARES FROM YOUR ACCOUNT.
(bullet) To set up, complete the appropriate section on the
application.
(bullet) All account owners must sign a signature card to receive a
checkbook.
(bullet) You may write an unlimited number of checks.
(bullet) Minimum check amount: $500.
(bullet) Do not try to close out your account by check.
(bullet) To obtain more checks, call your investment professional or,
if you trade directly through Fidelity, call 1-800-843-3001.
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).
(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, even if you have more than one account in
a fund. Call Fidelity at 1-888-622-3175 if you need additional
copies of financial reports or prospectuses. Call your investment
professional if you need historical account 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. Additional
documentation may be required from corporations, associations, and
certain fiduciaries.
When you sign your ACCOUNT APPLICATION, you will be asked to certify
that your social security or taxpayer identification number is correct
and that you are not subject to 31% backup withholding for failing to
report income to the IRS. If you violate IRS regulations, the IRS can
require a fund to withhold 31% of your taxable distributions and
redemptions.
If your ACCOUNT BALANCE falls below $500 (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 SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
Each fund earns interest, dividends and other income from its
investments, and distributes this income (less expenses) to
shareholders as dividends. Each fund may also realize capital gains
from its investments, and distributes these gains (less losses), if
any, to shareholders as capital gains distributions.
Distributions you receive from each fund consist primarily of
dividends. Each fund normally declares dividends daily and pays them
monthly.
You may request to have dividends relating to Capital Reserves Class
shares redeemed from an account closed during the month paid when the
account is closed. Each fund reserves the right to limit this service.
EARNING DIVIDENDS
Capital Reserves Class shares purchased by a wire order prior to 4:00
p.m. Eastern time for Prime Fund and Treasury Fund or prior to 12:00
noon Eastern time for Tax-Exempt Fund, with receipt of the wire in
proper form before the close of the Federal Reserve Wire System on
that day, generally begin to earn dividends on the day of purchase.
Capital Reserves Class shares purchased by all other orders begin to
earn dividends on the first business day following the day of
purchase.
However, on any day that the principal bond markets close early (as
recommended by the Bond Market Association) or the Kansas City Fed
for Tax-Exempt Fund or the New York Fed for Prime Fund and Treasury
Fund closes early, a class may advance the time on that day by
which wire purchase orders must be placed so that shares earn
dividends on the day of purchase.
In addition, on any day that the principal bond markets do not open
(as recommended by the Bond Market Association) or the Kansas City Fed
for Tax-Exempt Fund or the New York Fed for Prime Fund and Treasury
Fund does not open, shares begin to earn dividends on the first
business day following the day of purchase.
Capital Reserves Class shares redeemed by a wire order prior to 4:00
p.m. Eastern time for Prime Fund and Treasury Fund or prior to 12:00
noon Eastern time for Tax-Exempt Fund, generally earn dividends
through the day prior to the day of redemption.
Capital Reserves Class shares redeemed by all other orders earn
dividends until, but not including, the next business day following
the day of redemption.
However, on any day that the principal bond markets close early (as
recommended by the Bond Market Association) or the Kansas City Fed
for Tax-Exempt Fund or the New York Fed for Prime Fund and Treasury
Fund closes early, a class may set a time after which shares
redeemed by wire order earn dividends until, but not including, the
next business day following the day of redemption.
On any day that the principal bond markets do not open (as recommended
by the Bond Market Association) or the Kansas City Fed for Tax-Exempt
Fund or the New York Fed for Prime Fund and Treasury Fund does not
open, shares earn dividends until, but not including, the next
business day following the day of redemption.
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
Capital Reserves Class's distributions:
1. REINVESTMENT OPTION. Your dividends and capital gains
distributions, if any, will be automatically reinvested in additional
Capital Reserves Class shares of the fund. If you do not indicate a
choice on your application, you will be assigned this option.
2. CASH OPTION. Your dividends and capital gains distributions, if
any, will be 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, contact your investment
professional directly or 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 a fund could have tax
consequences for you. If you are not investing through a
tax-advantaged retirement account, you should consider these tax
consequences.
Distributions you receive from Prime Fund and Treasury Fund are
subject to federal income tax, and may also be subject to state or
local taxes.
Tax-Exempt Fund seeks to earn income and pay dividends exempt from
federal income tax. Income exempt from federal income tax may be
subject to state or local taxes. A portion of Tax-Exempt Fund's
income, and the dividends you receive, may be subject to federal and
state income taxes. Tax-Exempt Fund may also realize taxable income or
gains on the sale of municipal bonds and may make taxable
distributions.
For federal tax purposes, Prime Fund's and Treasury Fund's dividends,
Tax-Exempt Fund's distributions of gains on bonds characterized as
market discount, and each fund's distributions of short-term capital
gains are taxable to you as ordinary income. Each fund's distributions
of long-term capital gains, if any, are taxable to you generally as
capital gains.
Any taxable distributions you receive from a fund will normally be
taxable to you when you receive them, regardless of your distribution
option. If you elect to receive distributions in cash, you will
receive certain December distributions in January, but those
distributions will be taxable as if you received them on December 31.
FUND SERVICES
FUND MANAGEMENT
Each fund is a mutual fund, an investment that pools shareholders'
money and invests it toward a specified goal.
Fidelity Management & Research Company (FMR) is each fund's manager.
As of April 30 , 1998, FMR had approximately $ 529
billion in discretionary assets under management.
As the manager, FMR is responsible for choosing the funds' investments
and handling their business affairs.
Fidelity Investments Money Management, Inc. (FIMM), in Merrimack, New
Hampshire, is an affiliate of FMR and serves as sub-adviser for each
fund. As of May 1, 1998, FIMM had approximately $ 99
billion in discretionary assets under management. FIMM is
primarily responsible for choosing investments for each fund.
A fund could be adversely affected if the computer systems used by FMR
and other service providers do not properly process and calculate
date-related information from and after January 1, 2000. FMR has
advised each fund that it is actively working on necessary changes to
its computer systems and expects that its systems, and those of other
major service providers, will be modified prior to January 1, 2000.
However, there can be no assurance that there will be no adverse
impact on a fund.
Fidelity investment personnel may invest in securities for their own
investment accounts pursuant to a code of ethics that establishes
procedures for personal investing and restricts certain transactions.
Each fund pays a management fee to FMR.
The management fee is calculated and paid to FMR every month.
Each fund's annual management fee rate is 0.25% of its average net
assets.
FMR pays FIMM for providing assistance with investment advisory
services.
FUND DISTRIBUTION
Each fund is composed of multiple classes of shares. All classes of a
fund have a common investment objective and investment portfolio.
Fidelity Distributors Corporation (FDC) distributes Capital Reserves
Class's shares.
Capital Reserves Class of each fund has adopted a Distribution and
Service Plan pursuant to Rule 12b-1 under the Investment Company Act
of 1940. Under the plan, Capital Reserves Class of each fund is
authorized to pay FDC a monthly 12b-1 fee as compensation for
providing services intended to result in the sale of Capital Reserves
Class shares and/or shareholder support services. Capital Reserves
Class of each Fund currently pays FDC a monthly 12b-1 fee at an annual
rate of 0.50% of its average net assets throughout the month.
FDC may reallow to intermediaries, such as banks, broker-dealers and
other service-providers up to an annual rate of 0.50% of average net
assets they maintain, for providing services intended to result in the
sale of Capital Reserves Class shares and/or shareholder support
services.
Because 12b-1 fees are paid out of Capital Reserves Class's assets on
an ongoing basis, they will increase the cost of your investment and
may cost you more than paying other types of sales charges.
In addition, each Capital Reserves Class plan
specifically recognize s that FMR may make payments from its
management fee revenue, past profits, or other resources to FDC for
expenses incurred in connection with providing services intended to
result in the sale of Capital Reserves Class shares and/or shareholder
support services, including payments made to intermediaries that
provide those services. Currently, the Board of Trustees of each fund
has authorized such payments to intermediaries at an annual rate of up
to 0.10% of the average net assets they maintain.
Independent of the Capital Reserves Class plans, intermediaries that
maintain an average balance of $10 million or more in a single omnibus
account may receive an additional recordkeeping fee of up to 0.15% of
the average net assets they maintain. The recordkeeping fee will be
paid by FMR or its affiliates, not by the funds, and will not be paid
for distribution services.
To receive payments made pursuant to a Distribution and Service Plan
or record keeping fees, intermediaries 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 a 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
Statement of Additional Information (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 funds or FDC. This Prospectus and the related SAI do
not constitute an offer by the funds or by FDC to sell or to buy
shares of the funds to any person to whom it is unlawful to make such
offer.
APPENDIX
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand
Capital Reserve Class's financial history for the past year. Certain
information reflects financial results for a single class share. Total
returns for each period include the reinvestment of all dividends and
distributions. This information has been audited by
PricewaterhouseCoopers LLP, independent accountants, whose report,
along with each fund's financial highlights and financial statements,
are included in the funds' Annual Report. A free copy of the Annual
Report is available upon request.
PRIME FUND - CAPITAL RESERVES CLASS
SELECTED PER-SHARE
DATA AND RATIOS
YEARS ENDED 1998 1997E
OCTOBER 31
NET ASSET VALUE, $ 1.000 $ 1.000000
BEGINNING OF PERIOD
INCOME FROM
INVESTMENT
OPERATIONS
NET INVESTMENT .048 .000131
INCOME
LESS DISTRIBUTIONS
FROM NET (.048) (.000131)
INVESTMENT INCOME
NET ASSET VALUE, $ 1.000 $ 1.000000
END OF PERIOD
TOTAL RETURNB,C 4.89% .01%
NET ASSETS, END $ 2,256 $ 1,764
OF PERIOD (IN
MILLIONS)
RATIO OF .90%D .90%A,D
EXPENSES TO AVERAGE
NET ASSETS
RATIO OF NET 4.79% 4.78%A
INVESTMENT INCOME
TO AVERAGE NET
ASSETS
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS'S EXPENSES DURING
THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
E FOR OCTOBER 31, 1997 (COMMENCEMENT OF SALE OF CAPITAL RESERVES
CLASS SHARES).
TREASURY FUND - CAPITAL RESERVES CLASS
SELECTED PER-SHARE DATA
AND RATIOS
YEARS ENDED OCTOBER 31 1998 1997E
NET ASSET VALUE, $ 1.000 $ 1.000000
BEGINNING OF PERIOD
INCOME FROM INVESTMENT
OPERATIONS
NET INVESTMENT INCOME .047 .000134
LESS DISTRIBUTIONS
FROM NET INVESTMENT (.047) (.000134)
INCOME
NET ASSET VALUE, END OF $ 1.000 $ 1.000000
PERIOD
TOTAL RETURNB,C 4.78% .01%
NET ASSETS, END OF $ 480 $ 265
PERIOD (IN MILLIONS)
RATIO OF EXPENSES TO .90%D .90%A,D
AVERAGE NET ASSETS
RATIO OF NET INVESTMENT 4.67% 4.93%A
INCOME TO AVERAGE NET
ASSETS
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS'S EXPENSES DURING
THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
E FOR OCTOBER 31, 1997 (COMMENCEMENT OF SALE OF CAPITAL RESERVES
SHARES).
TAX-EXEMPT FUND - CAPITAL RESERVES CLASS
SELECTED PER-SHARE DATA
AND RATIOS
YEARS ENDED OCTOBER 31 1998 1997E
NET ASSET VALUE, $ 1.000 $ 1.000000
BEGINNING OF PERIOD
INCOME FROM INVESTMENT
OPERATIONS
NET INVESTMENT INCOME .027 .000078
LESS DISTRIBUTIONS
FROM NET INVESTMENT (.027) (.000078)
INCOME
NET ASSET VALUE, END OF $ 1.000 $ 1.000000
PERIOD
TOTAL RETURNB,C 2.78% .01%
NET ASSETS, END OF $ 186 $ 177
PERIOD (IN MILLIONS)
RATIO OF EXPENSES TO .90%D .90%A,D
AVERAGE NET ASSETS
RATIO OF NET INVESTMENT 2.73% 2.81%A
INCOME TO AVERAGE NET
ASSETS
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT
ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS'S EXPENSES DURING
THE PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS'S EXPENSE RATIO
WOULD HAVE BEEN HIGHER.
E FOR OCTOBER 31, 1997 (COMMENCEMENT OF SALE OF CAPITAL RESERVES
CLASS SHARES).
You can obtain additional information about the funds. The funds'
SAI includes more detailed information about each fund and its
investments. The SAI is incorporated herein by reference (legally
forms a part of the prospectus). Each fund's annual and semi-annual
reports include a discussion of the fund's holdings and
performance .
For a free copy of any of these documents or to request other
information or ask questions about a fund, call Fidelity at
1-8 88-622-3175 .
The SAI, the funds' annual and semi-annual reports and other related
materials are available on the SEC's Internet Web site
(http://www.sec.gov). You can obtain copies of this information upon
paying a duplicating fee, by writing the Public Reference Section of
the SEC, Washington, D.C. 20549-6009. You can also review and copy
information about the funds, including the funds' SAI, at the SEC's
Public Reference Room in Washington, D.C. Call 1-800-SEC-0330 for
information on the operation of the SEC's Public Reference Room.
INVESTMENT COMPANY ACT OF 1940, FILE NUMBER 2-78458
Fidelity, Fidelity Investments, Fidelity Investments & (Pyramid)
Design, and the Pyramid Design are registered trademarks of FMR Corp.
1.538628.101 DMFR-pro-1298
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
CASH MANAGEMENT
FUNDS
TREASURY FUND -
ADVISOR B CLASS
(fund number 658)
ADVISOR C CLASS
(fund number 529)
PROSPECTUS
DECEMBER 30, 1998(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON,
MA 02109
CONTENTS
FUND SUMMARY 2 INVESTMENT SUMMARY
2 PERFORMANCE
3 FEE TABLE
FUND BASICS 3 INVESTMENT DETAILS
4 VALUING SHARES
SHAREHOLDER INFORMATION 4 BUYING AND SELLING SHARES
11 EXCHANGING SHARES
12 ACCOUNT FEATURES AND POLICIES
14 DIVIDENDS AND CAPITAL GAINS
DISTRIBUTIONS
15 TAX CONSEQUENCES
FUND SERVICES 15 FUND MANAGEMENT
15 FUND DISTRIBUTION
APPENDIX 16 FINANCIAL HIGHLIGHTS
FUND SUMMARY
INVESTMENT SUMMARY
INVESTMENT OBJECTIVE
TREASURY FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
Fidelity Management and Research Company (FMR)'s principal investment
strategies include:
(small solid bullet) Investing in U.S. Treasury securities and
repurchase agreements for those securities.
(small solid bullet) Generall y maintaining a dollar-weighted
average maturity at 60 days or less.
(small solid bullet) Investing in compliance with industry-standard
requirements for money market funds for the quality, maturity and
diversification of investments.
PRINCIPAL INVESTMENT RISKS
The fund is subject to the following principal investment risks:
(small solid bullet) INTEREST RATE CHANGES. Interest rate increases
can cause the price of a money market security to decrease.
(small solid bullet) ISSUER-SPECIFIC CHANGES. A decline in the credit
quality of an issuer or the provider of credit support or a
maturity-shortening structure for a security can cause the price of a
money market security to decrease.
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. Although the fund seeks to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in the fund.
PERFORMANCE
The following information illustrates the changes in the fund's
performance , as represented by the performance of Class
B , from year to year. Returns are based on past results and are
not an indication of future performance.
Because Advisor C Class (Class C) of Treasury Fund was new when this
prospectus was printed, its performance history is not included.
Performance history will be available for Class C after Class C has
been in operation for one calendar year.
YEAR-BY-YEAR RETURNS
The returns in the chart do not include the effect of Advisor B
Class's (Class B) contingent deferred sales charge. If the effect of
the sales charge was reflected, returns would be lower than
those shown.
TREASURY FUND - ADVISOR B CLASS
CALENDAR YEARS 1995 1996 1997
4.68% 4.13% 4.23%
PERCENTAGE (%)
ROW: 1, COL: 1, VALUE: NIL
ROW: 2, COL: 1, VALUE: NIL
ROW: 3, COL: 1, VALUE: NIL
ROW: 4, COL: 1, VALUE: NIL
ROW: 5, COL: 1, VALUE: NIL
ROW: 6, COL: 1, VALUE: NIL
ROW: 7, COL: 1, VALUE: NIL
ROW: 8, COL: 1, VALUE: 4.68
ROW: 9, COL: 1, VALUE: 4.13
ROW: 10, COL: 1, VALUE: 4.23
DURING THE PERIODS SHOWN IN THE CHART FOR ADVISOR B CLASS OF TREASURY
FUND THE HIGHEST RETURN FOR A QUARTER WAS 1.19 % (QUARTER ENDING
JUNE 30, 199 5 ), AND THE LOWEST RETURN FOR A QUARTER WAS
0.99 % (QUARTER ENDING MARCH 31, 1997 ).
THE YEAR-TO-DATE RETURN AS OF SEPTEMBER 30, 1998 FOR ADVISOR B CLASS
OF TREASURY FUND WAS 3.18 %.
AVERAGE ANNUAL RETURNS
The returns in the following table include the effect of Class B's
5.00% maximum applicable contingent deferred sales charge.
FOR THE PERIODS ENDED PAST 1 LIFE OF FUND A
DECEMBER 31, 1997 YEAR
TREASURY FUND - ADVISOR B 0.23% 3.42%B
CLASS (LOAD ADJ.)
A B EGINNING JANUARY 1 OF THE FIRST CALENDAR YEAR FOLLOWING THE
CLASS'S COMMENCEMENT OF OPERATIONS.
B FROM JANUARY 1, 1995.
If FMR had not reimbursed certain class expenses during these periods,
Class B's total returns would have been lower.
FEE TABLE
The following table describes the fees and expenses that are incurred
when you buy, hold or sell Class B or Class C shares of the fund. The
annual class operating expenses provided below for Class B and
Class C are higher than the expenses actually paid by the
classes as the result of expense reimbursements during the period.
SHAREHOLDER FEES (PAID BY THE INVESTOR DIRECTLY )
CLASS B CLASS C
SALES CHARGE (LOAD) ON NONE NONE
PURCHASES AND REINVESTED
DISTRIBUTIONS
MAXIMUM CDSC (AS A % 5.00%A 1.00%B
OF THE LESSER OF ORIGINAL
PURCHASE PRICE OR
REDEMPTION PROCEEDS)
A MAXIMUM CDSC DECLINES OVER 6 YEARS FROM 5.00% TO 0%.
B ON CLASS C SHARES REDEEMED WITHIN ONE YEAR OF PURCHASE.
ANNUAL C LASS OPERATING EXPENSES (PAID FROM CLASS ASSETS )
CLASS B CLASS C
MANAGEMENT FEE 0.25% 0.25%
DISTRIBUTION AND SERVICE 1.00% 1.00%
(12B-1) FEE (INCLUDING
0.25% SERVICE FEE )
OTHER EXPENSES 0.31% 0.72%
TOTAL ANNUAL CLASS 1.56% 1.97%
OPERATING EXPENSESA
A FMR HAS VOLUNTARILY AGREED TO REIMBURSE CLASS B AND CLASS
C OF THE FUND TO THE EXTENT THAT TOTAL OPERATING EXPENSES
(EXCLUDING INTEREST, TAXES, BROKERAGE COMMISSIONS AND EXTRAORDINARY
EXPENSES) , AS A PERCENTAGE OF THEIR RESPECTIVE AVERAGE NET ASSETS,
EXCEED 1.40%. THESE ARRANGEMENTS CAN BE TERMINATED BY FMR AT ANY TIME.
Long-term shareholders may pay more than the economic equivalent of
the maximum sales charges permitted by the National Association of
Securities Dealers, Inc., due to 12b-1 fees.
A portion of the brokerage commissions that the fund pays is used to
reduce that fund's expenses. In addition, the fund has entered into
arrangements with its custodian and transfer agent whereby credits
realized as a result of uninvested cash balances are used to reduce
custodian and transfer agent expenses.
This EXAMPLE helps you compare the cost of investing in the funds with
the cost of investing in other mutual funds.
Let's say, hypothetically, that each class's annual return is 5% and
that your shareholder fees and each class'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 after the number of years indicated
and if you leave your account open:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
CLASS B CLASS C
ACCOUNT ACCOUNT ACCOUNT ACCOUNT
OPEN CLOSED OPEN CLOSED
1 YEAR $ 159 $ 659 $ 200 $ 300
3 $ 493 $ 793 $ 618 $ 618
YEARS
5 $ 850 $ 1,050 $ 1,062 $ 1,062
YEARS
10 $ 1,540A $ 1,540A $ 2,296 $ 2,296
YEARS
</TABLE>
A REFLECTS CONVERSION TO DAILY MONEY CLASS SHARES AFTER SEVEN YEARS.
FUND BASICS
INVESTMENT DETAILS
INVESTMENT OBJECTIVE
TREASURY FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
PRINCIPAL INVESTMENT STRATEGIES
FMR invests the fund's assets in U.S. Treasury securities and
repurchase agreements for those securities. FMR does not enter into
reverse repurchase agreements for the fund.
FMR general ly intends to maintain the fund's
dollar-weighted average maturity at 60 days or less.
In buying and selling securities for the fund, FMR complies with
industry-standard requirements for money market funds regarding the
quality, maturity and diversification of the fund's investments. FMR
stresses maintaining a stable $1.00 share price, liquidity and income.
DESCRIPTION OF PRINCIPAL SECURITY TYPES
MONEY MARKET SECURITIES are high quality, short-term debt securities
that pay a fixed, variable or floating interest rate. Securities are
often specifically structured so that they are eligible investments
for a money market fund. For example, in order to satisfy the maturity
restrictions for a money market fund, some money market securities
have demand or put features which have the effect of shortening the
security's maturity. Taxable money market securities include bank
certificates of deposit, bank acceptances , bank time
deposits, notes, commercial paper and U.S. Government securities.
U.S. GOVERNMENT SECURITIES are high quality securities issued or
guaranteed by the U.S. Treasury or by an agency or instrumentality of
the U.S. Government. U.S. Government securities may be backed by the
full faith and credit of the U.S. Treasury, the right to borrow from
the U.S. Treasury, or the agency or instrumentality issuing or
guaranteeing the security.
A R EPURCHASE AGREEMENT is an agreement to buy a security
at one price and a simultaneous agreement to sell it back at
a n agreed-upon price.
PRINCIPAL INVESTMENT RISKS
Many factors affect the fund's performance. The fund's yield will
change daily based on changes in interest rates and other market
conditions. Although the fund is managed to maintain a stable $1.00
share price, there is no guarantee that the fund will be able to do
so. For example, a major increase in interest rates or a decrease in
the credit quality of the issuer of one of the fund's investments
could cause the fund's share price to decrease. While the fund will
be charged premiums by a mutual insurance company for coverage of
specified types of losses related to default or bankruptcy on certain
securities, the fund may incur losses regardless of the insurance.
It is important to note that neither the fund nor its yield
is guaranteed by the U.S. Government.
The following factors may significantly affect a fund's performance:
INTEREST RATE CHANGES. Money market securities have varying levels of
sensitivity to changes in interest rates. In general, the price of a
money market security can fall when interest rates rise and can rise
when interest rates fall. Securities with longer maturities and the
securities of issuers in the financial services industry can be more
sensitive to interest rate changes. Short-term securities tend to
react to changes in short-term interest rates.
ISSUER-SPECIFIC CHANGES. Changes in the financial condition of an
issuer, changes in specific economic or political conditions that
affect a particular type of issuer, and changes in general economic or
political conditions can affect the credit quality or value of an
issuer's securities. Entities providing credit support or a
maturity-shortening structure also can be affected by these types of
changes. If the structure of a security fails to
function as intended, the security could decline in value.
FUNDAMENTAL INVESTMENT POLICIES
The polic y below is fundamental, that is, subject to
change only by shareholder approval.
TREASURY FUND seeks to obtain as high a level of current income as is
consistent with the preservation of capital and liquidity.
VALUING SHARES
The fund is open for business each day the New York Stock Exchange
(NYSE) is open.
A class's net asset value per share (NAV) is the value of a single
share. Fidelity(registered trademark) normally calculates each class'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 each class'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 on the basis of amortized cost.
SHAREHOLDER INFORMATION
BUYING AND SELLING SHARES
GENERAL INFORMATION
For account, product and service information, please use the following
phone numbers:
(small solid bullet) If you are investing through a broker-dealer or
insurance representative, 1-800-522-7297 (8:30 a.m.-7:00 p.m. Eastern
time, Monday through Friday).
(small solid bullet) If you are investing through a bank
representative, 1-800-843-3001 (8:30 a.m.-7:00 p.m. Eastern time,
Monday through Friday).
Please use the following addresses:
BUYING OR SELLING SHARES
Fidelity Investments
P.O. Box 770002
Cincinnati, OH 45277-0081
OVERNIGHT EXPRESS
Fidelity Investments
2300 Litton Lane - KH2A
Hebron, KY 41048
You may buy or sell Class B or Class C shares of the fund through a
retirement account or an investment professional. When you invest
through a retirement account or an investment professional, the
procedures for buying, selling and exchanging Class B or Class C
shares of the fund and the account features and policies may differ.
Additional fees may also apply to your investment in Class B or Class
C shares of the fund, including a transaction fee if you buy or sell
Class B or Class C shares of the fund through a broker or other
investment professional.
Certain methods of contacting Fidelity, such as by telephone, may be
unavailable or delayed (for example, during periods of unusual market
activity).
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) ROTH CONVERSION IRAS
(solid bullet) ROLLOVER IRAS
(solid bullet) 401(K) PLANS, AND CERTAIN OTHER 401(A)-QUALIFIED PLANS
(solid bullet) SIMPLE IRAS
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS)
(solid bullet) SALARY REDUCTION SEP-IRAS (SARSEPS)
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
Class B and Class C shares of the fund may be bought directly only in
connection with the Fidelity Advisor Systematic Exchange Program (the
Program) for purposes of exchanging into Class B or Class C shares, as
applicable, of the Fidelity Advisor funds or by exchange from Class B
or Class C shares of the Fidelity Advisor funds.
Class B and Class C shares bought in connection with the Program must
be exchanged into Class B or Class C shares of Fidelity Advisor funds
within 18 months of purchase. For more information regarding the
Program, see "Account Features and Policies" beginning on page
.
The price to buy one share of Class B or Class C is the class's NAV.
Class B and Class C shares are sold without a front-end sales charge,
but may be subject to a contingent deferred sales charge (CDSC) upon
redemption.
Your shares will be bought at the next NAV calculated after your
order is received in proper form.
It is the responsibility of your investment professional to transmit
your order to buy shares to Fidelity before the close of business on
the day you place your order.
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) You are advised to place your trades as early in
the day as possible and to provide Fidelity with advance notice of
large purchases.
(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.
(small solid bullet) If when you place your wire purchase order you
indicate that Fidelity will receive your wire that day, your wire must
be received in proper form by Fidelity at the applicable fund's
designated wire bank before the close of the Federal Reserve Wire
System on the day of purchase.
Class B and Class C shares can be bought or sold through
investment professionals using an automated order placement and
settlement system that guarantees payment for orders on a specified
date.
MINIMUMS
TO OPEN AN ACCOUNT
By Exchange from:
(small solid bullet) Fidelity Advisor fund $1,000
(small solid bullet) Certain Fidelity Advisor retirement
accountsA $500
Program account $10,000
TO ADD TO AN ACCOUNT
By Exchange from:
(small solid bullet) Fidelity Advisor fund $ 10 0
Program account None
MINIMUM BALANCE
By Exchange from:
(small solid bullet) Fidelity Advisor fund $500
(small solid bullet) Certain Fidelity Advisor retirement
accountsA None
Program account None
A FIDELITY ADVISOR TRADITIONAL IRA, ROTH IRA, ROTH CONVERSION IRA,
ROLLOVER IRA, SEP-IRA, AND KEOGH ACCOUNTS.
There is no minimum account balance or initial or subsequent purchase
minimum for 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.
PURCHASE AMOUNTS OF MORE THAN $250,000 WILL NOT BE ACCEPTED FOR CLASS
B SHARES.
PURCHASE AMOUNTS OF MORE THAN $1 MILLION WILL NOT BE ACCEPTED FOR
CLASS C SHARES. THIS LIMIT DOES NOT APPLY TO PURCHASES OF CLASS C
SHARES MADE BY AN EMPLOYEE BENEFIT PLAN.
KEY INFORMATION
PHONE TO OPEN AN ACCOUNT
(bullet)
Exchange from the same
class of a Fidelity Advisor
fund. Call your
investment professional
or call Fidelity at the
appropriate number
found in "General
Information."
TO ADD TO AN
ACCOUNT
(bullet)
Exchange from the same
class of a Fidelity Advisor
fund. Call your
investment professional
or call Fidelity at the
appropriate number
found in "General
Information."
MAIL TO OPEN AN
FIDELITY ACCOUNT
INVESTMENTS (bullet)
P.O. BOX 770002 Complete and sign the
CINCINNATI, OH application. Make your
45277-0081 check payable to the
complete name of the
fund and note the
applicable class. Mail to
your investment
professional or to the
address at left.
TO ADD TO AN
ACCOUNT
(bullet)
Make your check
payable to the complete
name of the fund and
note the applicable
class. Include your fund
account number on your
check and mail to your
investment professional
or to the address at left.
(bullet)
Exchange from the same
class of a Fidelity Advisor
fund. Send a letter of
instruction to your
investment professional or
to the address at left,
including your name, the
funds' names, the
applicable class names,
the fund account
numbers, and the dollar
amount or number of
shares to be exchanged.
IN PERSON TO OPEN AN
ACCOUNT
(bullet)
Bring your application
and check to your
investment professional.
TO ADD TO AN
ACCOUNT
(bullet)
Bring your check to your
investment professional.
WIRE TO OPEN AN
ACCOUNT
(bullet)
Call your investment
professional or call
Fidelity at the
appropriate number
found in "General
Information" to set up
your account and to
arrange a wire
transaction.
(bullet)
Wire to: Banker's Trust
Company, Bank Routing
# 021001033, Account
# 00159759.
(bullet)
Specify the complete
name of the fund, note
the applicable class, and
include your new fund
account number and
your name.
TO ADD TO AN
ACCOUNT
(bullet)
Call your investment
professional or call
Fidelity at the
appropriate number
found in "General
Information" to arrange
a wire transaction.
(bullet)
Wire to: Banker's Trust
Company, Bank Routing
# 021001033, Account
# 00159759.
(bullet)
Specify the complete
name of the fund, note
the applicable class, and
include your fund
account number and
your name.
AUTOMATICAL TO OPEN AN ACCOUNT
LY (bullet)
Not available.
TO ADD TO AN
ACCOUNT
(bullet)
Use Fidelity Advisor
Systematic Exchange
Program to exchange
from Class B or Class C
of a Fidelity Advisor
fund.
SELLING SHARES
The price to sell one share of each class is the class's NAV, minus
any applicable CDSC.
Your shares will be sold at the next NAV calculated after your order
is received in proper form, minus any applicable CDSC.
It is the responsibility of your investment professional to transmit
your order to sell shares to Fidelity before the close of business on
the day you place your order.
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 30 days ;
(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, 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 $500 worth of shares in the account to keep it
open, except accounts not subject to account minimums.
(small solid bullet) You are advised to place your trades as early in
the day as possible and to provide Fidelity with advance notice of
large redemptions.
(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) 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 assets rather than in cash if the Board of Trustees 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.
KEY INFORMATION
PHONE (bullet)
Call your investment
professional or call
Fidelity at the
appropriate number
found in "General
Information" to initiate a
wire transaction or to
request a check for your
redemption.
(bullet)
Exchange to the same
class of a Fidelity Advisor
fund. Call your
investment professional
or call Fidelity at the
appropriate number
found in "General
Information."
MAIL: INDIVIDUAL, JOINT
FIDELITY TENANT,
INVESTMENTS SOLE PROPRIETORSHIP,
P.O. BOX 770002 UGMA, UTMA
CINCINNATI, OH (bullet)
45277-0081 Send a letter of
instruction to your
investment professional
or to the address at left,
including your name, the
fund's name, the
applicable class 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
(bullet)
The account owner
should complete a
retirement distribution
form. Call your
investment professional
or call Fidelity at the
appropriate number
found in "General
Information" to request
one.
TRUST
(bullet)
Send a letter of
instruction to your
investment professional
or to the address at left,
including the trust's
name, the fund's name,
the applicable class
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
(bullet)
Send a letter of
instruction to your
investment professional
or to the address at left,
including the firm's
name, the fund's name,
the applicable class
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.
(bullet)
Include a corporate
resolution with corporate
seal or a signature
guarantee.
EXECUTOR,
ADMINISTRATOR,
CONSERVATOR,
GUARDIAN
(bullet)
Call your investment
professional or call
Fidelity at the
appropriate number
found in "General
Information" for
instructions.
IN PERSON INDIVIDUAL, JOINT
TENANT,
SOLE PROPRIETORSHIP,
UGMA, UTMA
(bullet)
Bring a letter of
instruction to your
investment professional.
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
(bullet)
The account owner
should complete a
retirement distribution
form. Visit your
investment professional
to request one.
TRUST
(bullet)
Bring a letter of
instruction to your
investment professional.
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
(bullet)
Bring a letter of
instruction to your
investment professional.
At least one person
authorized by corporate
resolution to act on the
account must sign the
letter of instruction.
(bullet)
Include a corporate
resolution with corporate
seal or a signature
guarantee.
EXECUTOR,
ADMINISTRATOR,
CONSERVATOR,
GUARDIAN
(bullet)
Visit your investment
professional for
instructions.
AUTOMATICAL (bullet)
LY Use Fidelity Advisor
Systematic Exchange
Program to exchange to
the same class of a
Fidelity Advisor fund.
(bullet)
Use Fidelity Advisor
Systematic Withdrawal
Program to set up
periodic redemptions
from your Class B or
Class C 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 Class B or Class C shareholder you have the privilege of
exchanging Class B or Class C shares for Class B or Class C shares, as
applicable, of a Fidelity Advisor fund.
However, you should note the following policies and restrictions
governing exchanges:
(small solid bullet) The fund or class 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 or class, read its
prospectus.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Currently, there is no limit on the number of
exchanges out of the fund.
(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 1.00% 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 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> <C>
FIDELITY
ADVISOR
SYSTEMATIC
EXCHANGE
PROGRAM
TO MOVE MONEY
FROM CLASS B OR
CLASS C OF
TREASURY FUND TO
THE SAME CLASS OF
A FIDELITY ADVISOR
FUND
MINIMUM FREQUENCY PROCEDURES
$100 Monthly, quarterly, (bullet) To set up
semi-annually, or a Program account, call
annually your investment
professional or call
Fidelity at the
appropriate number
found in "General
Information."
(bullet) To make
changes, call your
investment
professional or call
Fidelity at the
appropriate number
found in "General
Information." Call at
least 2 business days
prior to your next
scheduled exchange
date.
(bullet) The
account from which
the exchanges are to
be processed must
have a minimum
balance of $10,000.
The account into
which the exchange is
being processed must
have a minimum
balance of $1,000.
(bullet) Class B
and Class C shares
must be exchanged
for Class B or Class C
shares, as applicable,
of a Fidelity Advisor
fund within 18
months from the date
of purchase.
(bullet) The
Program is not
recommended for
purchasing Class B
shares of Fidelity
Advisor Intermediate
Bond Fund or Fidelity
Advisor Intermediate
Municipal Income
Fund by exchange
because of their CDSC
schedules. Call your
investment
professional or call
Fidelity at the
appropriate number
found in "General
Information" for
additional
information.
FIDELITY
ADVISOR
SYSTEMATIC
WITHDRAWAL
PROGRAM
TO SET UP PERIODIC
REDEMPTIONS FROM
YOUR CLASS B OR
CLASS C ACCOUNT TO
YOU OR TO YOUR
BANK CHECKING
ACCOUNT.
MINIMUM MAXIMUM FREQUENCY PROCEDURES
$100 $50,000 Monthly or quarterly (bullet) Accounts
with a value of
$10,000 or more in
Class B or Class C
shares are eligible for
this program.
(bullet) To set up,
call your investment
professional or call
Fidelity at the
appropriate number
found in "General
Information" for
instructions.
(bullet) To make
changes, call your
investment professional
or call Fidelity at the
appropriate number
found in "General
Information." Call at
least 10 business days
prior to your next
scheduled withdrawal
date.
(bullet) Aggregat
e redemptions per
12-month period from
your Class B or Class
C account may not
exceed 10% of the
account value and are
not subject to a CDSC.
(bullet) You may
set your withdrawal
amount as a
percentage of the
value of your account
or a fixed dollar
amount.
</TABLE>
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.
(bullet) You must sign up for the Wire feature before using it.
Complete the appropriate section on the application when opening your
account.
(bullet) Call your investment professional or call Fidelity at the
appropriate number found in "General Information" before your first
use to verify that this feature is set up on your account.
(bullet) To sell shares by wire, you must designate the U.S.
commercial bank account(s) into which you wish the redemption proceeds
deposited.
(bullet) To add the wire feature or to change the bank account
designated to receive redemption proceeds at any time prior to
making a redemption request , you should send a letter of
instruction, including a signature guarantee, to your investment
professional or to Fidelity at the address found in "General
Information."
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 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, even if you have more than one account in
the fund. Call Fidelity at 1-888-622-3175 if you need additional
copies of financial reports or prospectuses. Call your investment
professional if you need historical account 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. Additional
documentation may be required from corporations, associations, and
certain fiduciaries.
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.
If your ACCOUNT BALANCE falls below $500 (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, minus any applicable CDSC, on the day your account is
closed.
Fidelity may charge a FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services.
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The fund earns interest, dividends and other income from its
investments, and distributes this income (less expenses) to
shareholders as dividends. The fund may also realize capital gains
from its investments, and distributes these gains (less losses), if
any, to shareholders as capital gains distributions.
Distributions you receive from the fund consist primarily of
dividends. The fund normally declares dividends daily and pays them
monthly.
You may request to have dividends relating to Class B and Class C
shares redeemed from an account closed during the month paid when the
account is closed. The fund reserves the right to limit this service.
EARNING DIVIDENDS
Class B and Class C shares begin to earn dividends on the first
business day following the day your payment is received.
Class B and Class C shares earn dividends until, but not including,
the next business day following the day of redemption.
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
each class's distributions:
1. REINVESTMENT OPTION. Your dividends and capital gains
distributions, if any, will be automatically reinvested in additional
shares of the same class of the fund. If you do not indicate a choice
on your application, you will be assigned this option.
2. CASH OPTION. Your dividends and capital gains distributions, if
any, will be 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, contact your investment
professional directly or 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.
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. The
fund's distributions of long-term capital gains, if any, are taxable
to you generally as capital gains.
Any taxable distributions you receive from the fund will normally be
taxable to you when you receive them, regardless of your distribution
option. If you elect to receive distributions in cash, you will
receive certain December distributions in January, but those
distributions will be taxable as if you received them on December 31.
FUND SERVICES
FUND MANAGEMENT
Treasury Fund is a mutual fund, an investment that pools shareholders'
money and invests it toward a specified goal.
Fidelity Management & Research Company (FMR) is the fund's manager.
As of April 30 , 1998, FMR had approximately $ 529
billion in discretionary assets under management.
As the manager, FMR is responsible for choosing the fund's investments
and handling its business affairs.
Fidelity Investments Money Management, Inc. (FIMM), in Merrimack, New
Hampshire, is an affiliate of FMR and serves as sub-adviser for the
fund. As of May 1 , 1998, FIMM had approximately $ 99
billion in discretionary assets under management. FIMM is
primarily responsible for choosing investments for the fund.
The fund could be adversely affected if the computer systems used by
FMR and other service providers do not properly process and calculate
date-related information from and after January 1, 2000. FMR has
advised the fund that it is actively working on necessary changes to
its computer systems and expects that its systems, and those of other
major service providers, will be modified prior to January 1, 2000.
However, there can be no assurance that there will be no adverse
impact on the fund.
Fidelity investment personnel may invest in securities for their own
investment accounts pursuant to a code of ethics that establishes
procedures for personal investing and restricts certain transactions.
The fund pays a management fee to FMR.
The management fee is calculated and paid to FMR every month.
The fund's annual management fee rate is 0.25% of its average net
assets.
FMR pays FIMM for providing assistance with investment advisory
services.
FMR may, from time to time, agree to reimburse each class for
management fees and other expenses above a specified limit. FMR
retains the ability to be repaid by a class if expenses fall below the
specified limit prior to the end of the fiscal year. Reimbursement
arrangements can decrease a class's expenses and boost its
performance.
FUND DISTRIBUTION
The fund is composed of multiple classes of shares. All classes of the
fund have a common investment objective and investment portfolio.
Fidelity Distributors Corporation (FDC) distributes the class's
shares.
You may pay a sales charge when you sell your Class B or Class C
shares.
FDC collects the sales charge.
Your Class B shares bought by exchange retain the contingent
deferred sales charge (CDSC) schedule that was in effect when you
originally bought the Fidelity Advisor fund Class B shares that
you exchanged for Class B shares of the fund.
Class B shares bought directly in connection with the Program
may be assessed a CDSC based on the following schedule:
FROM DATE OF PURCHASE CONTINGENT DEFERRED
SALES CHARGE
LESS THAN 1 YEAR 5%
1 YEAR TO LESS THAN 2 4%
YEARS
2 YEARS TO LESS THAN 3 3%
YEARS
3 YEARS TO LESS THAN 4 3%
YEARS
4 YEARS TO LESS THAN 5 2%
YEARS
5 YEARS TO LESS THAN 6 1%
YEARS
6 YEARS TO LESS THAN 7 0%
YEARSA
A AFTER SEVEN YEARS, CLASS B SHARES WILL CONVERT AUTOMATICALLY TO
DAILY MONEY CLASS SHARES OF THE FUND.
Except as provided below, investment professionals receive as
compensation from FDC, at the time of sale, a concession equal to
4.00% of your direct purchase of Class B shares. For purchases of
Class B shares through reinvested dividends or capital gains
distributions, investment professionals do not receive a concession at
the time of sale.
Class C shares may, upon redemption within one year of purchase, be
assessed a CDSC of 1.00%.
Except as provided below, investment professionals receive as
compensation from FDC, at the time of sale, a concession equal to
1.00% of your purchase of Class C shares. For purchases of Class C
shares made for an employee benefit plan or through reinvestment of
dividends or capital gains distributions, investment professionals do
not receive a concession at the time of sale.
The CDSC for Class B and Class C shares will be calculated based on
the lesser of the cost of the Class B or Class C shares, as
applicable, at the initial date of purchase or the value of those
Class B or Class C shares, as applicable, at redemption, not including
any reinvested dividends or capital gains, if any. Class B and Class C
shares acquired through reinvestment of dividends or capital gains
distributions will not be subject to a CDSC. In determining the
applicability and rate of any CDSC at redemption, Class B or Class C
shares representing reinvested dividends and capital gains, if any,
will be redeemed first, followed by those Class B or Class C shares
that have been held for the longest period of time.
The CDSC on Class B and Class C shares may be waived:
1. In cases of disability or death, provided that the shares are sold
within one year following the death or the initial determination of
disability;
2. In connection with a total or partial redemption related to certain
distributions from retirement plans or accounts at age 701/2 which are
permitted without penalty pursuant to the Internal Revenue Code;
3. In connection with redemptions through the Fidelity Advisor
Systematic Withdrawal Program; or
4. (Applicable to Class C only) In connection with any
redemptions from an employee benefit plan. Employee benefit plan
investors must meet additional requirements specified in the fund's
SAI.
REINSTATEMENT PRIVILEGE. If you have sold all or part of your Class B
or Class C shares, you may reinvest an amount equal to all or a
portion of the redemption proceeds in the same class of the fund or a
Fidelity Advisor fund, at the NAV next determined after receipt in
proper form of your investment order, provided that such reinvestment
is made within 90 days of redemption. Under these circumstances, the
dollar amount of the CDSC you paid, if any, will be reimbursed to you
by reinvesting that amount in Class B or Class C shares, as
applicable. You must reinstate your Class B or Class C shares into an
account with the same registration. This privilege may be exercised
only once by a shareholder with respect to the fund and certain
restrictions may apply. For purposes of the CDSC schedule, the holding
period will continue as if the Class B or Class C shares had not been
redeemed.
CONVERSION FEATURE. After a maximum of seven years from the initial
date of purchase, Class B shares convert automatically to Daily Money
Class shares of the fund. Conversion to Daily Money Class shares will
be made at NAV. At the time of conversion, a portion of the Class B
shares purchased through the reinvestment of dividends or capital
gains, if any, (Dividend Shares) will also convert to Daily Money
Class shares. The portion of Dividend Shares that will convert is
determined by the ratio of your converting Class B non-Dividend Shares
to your total Class B non-Dividend Shares.
Daily Money Class shares are offered at NAV. Daily Money Class
has adopted a Distribution and Service Plan pursuant to Rule 12b-1
under the Investment Company Act of 1940 . Under the Plan, Daily
Money Class currently pay s FDC a monthly 12b-1 fee at an
annual rate of 0.25% of its average net assets throughout the
month . In addition, t he Daily Money Class Plan recognizes
that FMR may make payments from its management fee revenue, past
profits, or other resources to FDC for expenses incurred in connection
with providing services intended to result in the sale of Daily
Money Class shares and/or shareholder support services , including
payments made to intermediaries that provide those services .
Currently, t he Board of Trustees of the fund has authorized
such payments.
Class B of Treasury Fund has adopted a Distribution and Service Plan
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under
the plan, Class B is authorized to pay FDC a monthly 12b-1
(distribution) fee as compensation for providing services intended to
result in the sale of Class B shares. Class B currently pays FDC a
monthly 12b-1 (distribution) fee at an annual rate of 0.75% of its
average net assets throughout the month.
In addition, pursuant to the Class B plan, Class B pays FDC a monthly
12b-1 (service) fee at an annual rate of 0.25% of Class B's average
net assets throughout the month for providing shareholder support
services.
FDC may reallow up to the full amount of the Class B 12b-1 (service)
fee to intermediaries, such as banks, broker-dealers and other
service-providers for providing shareholder support services.
Class C of Treasury Fund has adopted a Distribution and Service Plan
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under
the plan, Class C is authorized to pay FDC a monthly 12b-1
(distribution) fee as compensation for providing services intended to
result in the sale of Class C shares. Class C currently pays FDC a
monthly 12b-1 (distribution) fee at an annual rate of 0.75% of its
average net assets throughout the month.
In addition, pursuant to the Class C plan, Class C pays FDC a monthly
12b-1 (service) fee at an annual rate of 0.25% of Class C's average
net assets throughout the month for providing shareholder support
services.
Normally, after the first year of investment, FDC may reallow up to
the full amount of the Class C 12b-1 (distribution) fee to
intermediaries, such as banks, broker-dealers and other
service-providers for providing services intended to result in the
sale of Class C shares and may reallow up to the full amount of the
Class C 12b-1 (service) fee to intermediaries for providing
shareholder support services.
For purchases of Class C shares made for an employee benefit plan or
through reinvestment of dividends or capital gains distributions,
during the first year of investment and thereafter, FDC may reallow up
to the full amount of the Class C 12b-1 (distribution) fee paid by
such shares to intermediaries for providing services intended to
result in the sale of Class C shares and may reallow up to the full
amount of the Class C 12b-1 (service) fee paid by such shares to
intermediaries for providing shareholder support services.
Because 12b-1 fees are paid out of each class's assets on an
ongoing basis, they will increase the cost of your investment and may
cost you more than paying other types of sales charges.
In addition, each plan specifically recognize s that FMR
may make payments from its management fee revenue, past profits, or
other resources to FDC for expenses incurred in connection with
providing services intended to result in the sale of the applicable
class's shares and/or shareholder support services, including payments
made to intermediaries that provide those services. Currently, the
Board of Trustees of the fund has authorized such payments for Class B
and Class C.
To receive sales concessions and payments made pursuant to a
Distribution and Service Plan, intermediaries 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
Statement of Additional Information (SAI), in connection with the
offer contained in this Prospectus. If given or made, such other
information or representations must not be relied upon as having been
authorized by the fund or FDC. This Prospectus and the related SAI do
not constitute an offer by the fund or by FDC to sell or to buy shares
of the fund to any person to whom it is unlawful to make such offer.
APPENDIX
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand
Class B's financial history for the past four years and Class C's
financial history for the past year. Certain information reflects
financial results for a single class share. Total returns for each
period include the 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.
ADVISOR B CLASS
SELECTED
PER-SHARE
DATA AND
RATIOS
YEARS ENDED 1998 1997 1996E 1996F 1995F 1994G
OCTOBER 31
NET ASSET $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
VALUE,
BEGINNING OF
PERIOD
INCOME FROM
INVESTMENT
OPERATIONS
NET .042 .041 .010 .043 .042 .002
INVESTMENT
INCOME
LESS
DISTRIBUTIONS
FROM NET (.042) (.041) (.010) (.043) (.042) (.002)
INVESTMENT
INCOME
NET ASSET $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
VALUE, END OF
PERIOD
TOTAL 4.26% 4.20% 1.01% 4.33% 4.28% .25%
RETURNB,C
NET ASSETS, $ 76 $ 46 $ 20 $ 40 $ 3 $ 1
END OF PERIOD
(IN MILLIONS)
RATIO OF 1.40%D 1.39%D 1.35%A,D 1.35%D 1.35%D 1.35%A,D
EXPENSES TO
AVERAGE NET
ASSETS
RATIO OF NET 4.16% 4.24% 3.96%A 4.13% 4.22% 3.03%A
INVESTMENT
INCOME TO
AVERAGE NET
ASSETS
A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE CONTINGENT DEFERRED SALES CHARGE
AND FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS'S EXPENSE RATIO WOULD
HAVE BEEN HIGHER.
E THREE MONTHS ENDED OCTOBER 31
F YEAR ENDED JULY 31
G FOR JULY 1, 1994 (COMMENCEMENT OF SALE OF ADVISOR B CLASS SHARES) TO
JULY 31, 1994
ADVISOR C CLASS
SELECTED PER-SHARE DATA AND
RATIOS
YEAR ENDED OCTOBER 31 1998E
NET ASSET VALUE, BEGINNING $ 1.000
OF PERIOD
INCOME FROM INVESTMENT
OPERATIONS
NET INVESTMENT INCOME .041
LESS DISTRIBUTIONS
FROM NET INVESTMENT (.041)
INCOME
NET ASSET VALUE, END OF $ 1.000
PERIOD
TOTAL RETURNB,C 4.22%
NET ASSETS, END OF PERIOD (IN $ 16
MILLIONS)
RATIO OF EXPENSES TO 1.40%A,D
AVERAGE NET ASSETS
RATIO OF NET INVESTMENT 4.24%A
INCOME TO AVERAGE NET
ASSETS
A ANNUALIZED
B TOTAL RETURNS DO NOT INCLUDE THE CONTINGENT DEFERRED SALES CHARGE
AND FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
D FMR AGREED TO REIMBURSE A PORTION OF THE CLASS'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE CLASS'S EXPENSE RATIO WOULD
HAVE BEEN HIGHER.
E FOR NOVEMBER 3, 1997 (COMMENCEMENT OF SALE OF ADVISOR C CLASS
SHARES) TO OCTOBER 31, 1998.
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
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- 888-622-3175 .
The SAI, the fund's annual and semi-annual reports and other related
materials are available on the SEC's Internet Web site
(http://www.sec.gov). You can obtain copies of this information upon
paying a duplicating fee, by writing the Public Reference Section of
the SEC, Washington, D.C. 20549-6009. 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 1-800-SEC-0330 for
information on the operation of the SEC's Public Reference Room.
INVESTMENT COMPANY ACT OF 1940, FILE NUMBER 2-78458
Fidelity, Fidelity Investments, Fidelity Investments & (Pyramid)
Design, and the Pyramid Design are registered trademarks of FMR Corp.
1.538747.101 DMFB/DMFC-pro-1298
FIDELITY CASH MANAGEMENT FUNDS
PRIME FUND: CAPITAL RESERVES CLASS AND DAILY MONEY CLASS
TREASURY FUND: CAPITAL RESERVES CLASS, DAILY MONEY CLASS, ADVISOR
B CLASS AND ADVISOR C CLASS TAX-EXEMPT FUND: CAPITAL RESERVES
CLASS AND DAILY MONEY CLASS
FUNDS OF NEWBURY STREET TRUST
STATEMENT OF ADDITIONAL INFORMATION
DECEMBER 30, 1998
This Statement of Additional Information (SAI) is not a prospectus.
Portions of the funds' Annual Report are incorporated herein. The
Annual Report is supplied with this SAI.
To obtain a free additional copy of a Prospectus, dated December 30,
1998 or an Annual Report, please call Fidelity(registered trademark)
at 1-8 88-622-3175 .
TABLE OF CONTENTS PAGE
INVESTMENT POLICIES AND 2
LIMITATIONS
PORTFOLIO TRANSACTIONS 6
VALUATION 7
PERFORMANCE 7
ADDITIONAL PURCHASE, EXCHANGE 23
AND REDEMPTION INFORMATION
DISTRIBUTIONS AND TAXES 23
TRUSTEES AND OFFICERS 24
CONTROL OF INVESTMENT ADVISERS 26
MANAGEMENT CONTRACTS 26
DISTRIBUTION SERVICES 30
TRANSFER AND SERVICE AGENT 32
AGREEMENTS
DESCRIPTION OF THE TRUST 32
FINANCIAL STATEMENTS 33
APPENDIX 33
For more information on any Fidelity fund, including charges and
expenses, call Fidelity at the number indicated above for a free
prospectus. Read it carefully before you invest or send money.
(fidelity_logo_graphic) 82 Devonshire Street, Boston, MA 02109
DMF-ptb-1298 1.539174.101
INVESTMENT POLICIES AND LIMITATIONS
The following policies and limitations supplement those set forth in
the Prospectus. Unless otherwise noted, whenever an investment policy
or limitation states a maximum percentage of a fund's assets that may
be invested in any security or other asset, or sets forth a policy
regarding quality standards, such standard or percentage limitation
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.
A 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.
INVESTMENT LIMITATIONS OF PRIME FUND
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 (i) borrow money for
temporary or emergency purposes (not for leveraging or investment) and
(ii) engage in reverse repurchase agreements for any purpose; provided
that (i) and (ii) in combination do not exceed 33 1/3% of the fund's
total assets (including the amount borrowed) less liabilities (other
than borrowings). Any borrowings that come to exceed this amount will
be reduced within three days (not including Sundays and holidays) to
the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the
extent that the fund may be considered an underwriter within the
meaning of the Securities Act of 1933 in the disposition of restricted
securities;
(5) purchase the securities of any issuer (other than
securities issued or guaranteed by the U.S. government or any of its
agencies or instrumentalities) if, as a result, more than 25% of the
fund's total assets would be invested in the securities of companies
whose principal business activities are in the same industry, except
that the fund will invest more than 25% of its total assets in the
financial services industry;
(6) 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; or
(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 objectives, policies and
limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to purchase a security
(other than securities issued or guaranteed by the U.S. Government or
any of its agencies or instrumentalities, or securities of other money
market funds) if, as a result, more than 5% of its total assets would
be invested in securities of a single issuer; provided that the fund
may invest up to 25% of its total assets in the first tier securities
of a single issuer for up to three business days.
(ii) The fund does not currently intend to sell securities
short, unless it owns or has the right to obtain securities equivalent
in kind and amount to the securities sold short, and provided that
transactions in futures contracts and options are not deemed to
constitute selling securities short.
(iii) The fund does not currently intend to purchase securities
on margin, except that the fund may obtain such short-term credits as
are necessary for the clearance of transactions, and provided that
margin payments in connection with futures contracts and options on
futures contracts shall not constitute purchasing securities on
margin.
(iv) The fund may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an
affiliate serves as investment adviser or (b) by engaging in reverse
repurchase agreements with any party. The fund will not borrow from
other funds advised by FMR or its affiliates if total outstanding
borrowings immediately after such borrowing would exceed 15% of the
fund's total assets.
(v) The fund does not currently intend to purchase any security
if, as a result, more than 10% of its net assets would be invested in
securities that are deemed to be illiquid because they are subject to
legal or contractual restrictions on resale or because they cannot be
sold or disposed of in the ordinary course of business at
approximately the prices at which they are valued.
(vi) The fund does not currently intend to purchase or sell
futures contracts or call options. This limitation does not apply to
options attached to, or acquired or traded together with, their
underlying securities, and does not apply to securities that
incorporate features similar to options or futures contracts.
(vii) The fund does not currently intend to lend assets other
than securities to other parties, except by lending money (up to 10%
of the fund's net assets) to a registered investment company or
portfolio for which FMR or an affiliate serves as investment adviser.
(This limitation does not apply to purchases of debt securities or to
repurchase agreements.)
(viii) The fund does not currently intend to 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.
For purposes of limitation (1) and (i), certain securities subject to
guarantees (including insurance, letters of credit and demand
features) are not considered securities of their issuer, but are
subject to separate diversification requirements, in accordance with
industry standard requirements for money market funds.
With respect to limitation (v), 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 was invested in illiquid securities, it
would consider appropriate steps to protect liquidity.
SHAREHOLDER NOTICE. Prime Fund does not intend to purchase futures
contracts or options on futures contracts. This operating policy may
be changed only upon approval by the Board of Trustees and 60 days'
notice to shareholders.
INVESTMENT LIMITATIONS OF TREASURY FUND
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 (i) borrow money for
temporary or emergency purposes (not for leveraging or investment) and
(ii) engage in reverse repurchase agreements for any purpose; provided
that (i) and (ii) in combination do not exceed 33 1/3% of the fund's
total assets (including the amount borrowed) less liabilities (other
than borrowings). Any borrowings that come to exceed this amount will
be reduced within three days (not including Sundays and holidays) to
the extent necessary to comply with the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the
extent that the fund may be considered an underwriter within the
meaning of the Securities Act of 1933 in the disposition of restricted
securities;
(5) purchase the securities of any issuer (other than
securities issued or guaranteed by the U.S. government or any of its
agencies or instrumentalities) if, as a result, more than 25% of the
fund's total assets would be invested in the securities of companies
whose principal business activities are in the same industry;
(6) 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; or
(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 objectives, policies and
limitations as the fund.
THE FOLLOWING LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED
WITHOUT SHAREHOLDER APPROVAL:
(i) The fund does not currently intend to purchase a security
(other than securities issued or guaranteed by the U.S. Government or
any of its agencies or instrumentalities, or securities of other money
market funds) if, as a result, more than 5% of its total assets would
be invested in securities of a single issuer; provided that the fund
may invest up to 25% of its total assets in the first tier securities
of a single issuer for up to three business days.
(ii) The fund does not currently intend to sell securities
short, unless it owns or has the right to obtain securities equivalent
in kind and amount to the securities sold short, and provided that
transactions in futures contracts and options are not deemed to
constitute selling securities short.
(iii) The fund does not currently intend to purchase securities
on margin, except that the fund may obtain such short-term credits as
are necessary for the clearance of transactions, and provided that
margin payments in connection with futures contracts and options on
futures contracts shall not constitute purchasing securities on
margin.
(iv) The fund may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an
affiliate serves as investment adviser or (b) by engaging in reverse
repurchase agreements with any party. The fund will not borrow from
other funds advised by FMR or its affiliates if total outstanding
borrowings immediately after such borrowing would exceed 15% of the
fund's total assets.
(v) The fund does not currently intend to purchase any security
if, as a result, more than 10% of its net assets would be invested in
securities that are deemed to be illiquid because they are subject to
legal or contractual restrictions on resale or because they cannot be
sold or disposed of in the ordinary course of business at
approximately the prices at which they are valued.
(vi) The fund does not currently intend to purchase or sell
futures contracts or call options. This limitation does not apply to
options attached to, or acquired or traded together with, their
underlying securities, and does not apply to securities that
incorporate features similar to options or futures contracts.
(vii) The fund does not currently intend to make loans, but
this limitation does not apply to purchases of debt securities or to
repurchase agreements.
(viii) The fund does not currently intend to invest 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.
For purposes of limitation (1) and (i), certain securities subject to
guarantees (including insurance, letters of credit and demand
features) are not considered securities of their issuer, but are
subject to separate diversification requirements, in accordance with
industry standard requirements for money market funds.
With respect to limitation (v), 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 was invested in illiquid securities, it
would consider appropriate steps to protect liquidity.
SHAREHOLDER NOTICE. Treasury Fund invests only in U.S. Treasury
securities and repurchase agreements for those securities. This
operating policy may be changed only upon 90 days' notice to
shareholders. Treasury Fund does not intend to purchase futures
contracts or options on futures contracts. This operating policy may
be changed only upon approval by the Board of Trustees and 60 days'
notice to shareholders.
INVESTMENT LIMITATIONS OF TAX-EXEMPT FUND
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) make short sales of securities;
(4) purchase any securities on margin, except for such
short-term credits as are necessary for the clearance of transactions;
(5) borrow money, except for temporary or emergency purposes
(not for leveraging or investment) in an amount not exceeding 33 1/3%
of the value of its total assets (including the amount borrowed) less
liabilities (other than borrowings). Any borrowings that come to
exceed the 33 1/3% of the fund's assets by reason of a decline in net
assets will be reduced within three days (exclusive of Sundays and
holidays) to the extent necessary to comply with the 33 1/3%
limitation;
(6) underwrite any issue of securities; except to the extent
that the purchase of municipal bonds in accordance with the fund's
investment objective, policies, and restrictions, either directly from
the issuer, or from an underwriter for an issuer, may be deemed
underwriting;
(7) 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 tax-exempt obligations issued or
guaranteed by a U.S. territory or possession or a state or local
government, or a political subdivision of any of the foregoing) if, as
a result, more than 25% of the fund's total assets would be invested
in securities of companies whose principal business activities are in
the same industry;
(8) purchase or sell real estate, but this shall not prevent
the fund from investing in municipal bonds or other obligations
secured by real estate or interests therein;
(9) purchase or sell commodities or commodity (futures)
contracts;
(10) lend any security or make any other loan if, as a result,
more than 33 1/3% of its total assets would be lent to other parties,
but this limitation does not apply to purchases of debt securities or
to repurchase agreements; or
(11) invest in oil, gas or other mineral exploration or
development programs.
(12) The fund may, notwithstanding any other fundamental
investment policy or limitation, invest all of its assets in the
securities of a single open-end management investment company with
substantially the same fundamental investment objective, policies, and
limitations as the fund.
THE FOLLOWING LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED
WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to purchase a security
(other than securities issued or guaranteed by the U.S. Government or
any of its agencies or instrumentalities, or securities of other money
market funds) if, as a result, more than 5% of its total assets would
be invested in securities of a single issuer; provided that the fund
may invest up to 25% of its total assets in the first tier securities
of a single issuer for up to three business days.
(ii) The 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 (5)). The fund will not borrow from other funds advised by
FMR or its affiliates if total outstanding borrowings immediately
after such borrowing would exceed 15% of the fund's total assets.
(iii) 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.
(iv) The fund does not currently intend to invest in interests
in real estate investment trusts that are not readily marketable, or
to invest in interests in real estate limited partnerships that are
not listed on the New York Stock Exchange or the American Stock
Exchange or traded on the NASDAQ National Market System.
(v) The fund does not currently intend to purchase or sell
futures contracts or call options. This limitation does not apply to
options attached to, or acquired or traded together with, their
underlying securities, and does not apply to securities that
incorporate features similar to options or futures contracts.
(vi) The fund does not currently intend to engage in repurchase
agreements or make loans, but this limitation does not apply to
purchases of debt securities.
(vii) 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.
For purposes of limitations (1), (i) and (7), FMR identifies the
issuer of a security depending on its terms and conditions. In
identifying the issuer, FMR will consider the entity or entities
responsible for payment of interest and repayment of principal and the
source of such payments; the way in which assets and revenues of an
issuing political subdivision are separated from those of other
political entities; and whether a governmental body is guaranteeing
the security.
For purposes of limitation (1) and (i), certain securities subject to
guarantees (including insurance, letters of credit and demand
features) are not considered securities of their issuer, but are
subject to separate diversification requirements, in accordance with
industry standard requirements for money market funds.
With respect to limitation (iii), 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 was invested in illiquid securities, it
would consider appropriate steps to protect liquidity.
The following pages contain more detailed information about types of
instruments in which a fund may invest, strategies FMR may employ in
pursuit of a 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 a 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.
ASSET-BACKED SECURITIES represent interests in pools of purchase
contracts, financing leases, or sales agreements entered into by
municipalities, mortgages, loans, receivables or other assets. Payment
of interest and repayment of principal may be largely dependent upon
the cash flows generated by the assets backing the securities and, in
certain cases, supported by letters of credit, surety bonds, or other
credit enhancements. Asset-backed security values may also be affected
by other factors including changes in interest rates, the availability
of information concerning the pool and its structure, the
creditworthiness of the servicing agent for the pool, the originator
of the loans or receivables, or the entities providing the credit
enhancement. In addition, these securities may be subject to
prepayment risk.
BORROWING. Each fund may borrow from banks or from other funds advised
by FMR or its affiliates, or through reverse repurchase agreements,
and may make additional investments while borrowings are outstanding.
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.
DOMESTIC AND FOREIGN INVESTMENTS include U.S. dollar-denominated time
deposits, certificates of deposit, and bankers' acceptances of U.S.
banks and their branches located outside of the United States, U.S.
branches and agencies of foreign banks, and foreign branches of
foreign banks. Domestic and foreign investments may also include U.S.
dollar-denominated securities issued or guaranteed by other U.S. or
foreign issuers, including U.S. and foreign corporations or other
business organizations, foreign governments, foreign government
agencies or instrumentalities, and U.S. and foreign financial
institutions, including savings and loan institutions, insurance
companies, mortgage bankers, and real estate investment trusts, as
well as banks.
The obligations of foreign branches of U.S. banks may be general
obligations of the parent bank in addition to the issuing branch, or
may be limited by the terms of a specific obligation and by
governmental regulation. Payment of interest and repayment of
principal on these obligations may also be affected by governmental
action in the country of domicile of the branch (generally referred to
as sovereign risk). In addition, evidence of ownership of portfolio
securities may be held outside of the United States and a fund may be
subject to the risks associated with the holding of such property
overseas. Various provisions of federal law governing the
establishment and operation of U.S. branches do not apply to foreign
branches of U.S. banks.
Obligations of U.S. branches and agencies of foreign banks may be
general obligations of the parent bank in addition to the issuing
branch, or may be limited by the terms of a specific obligation and by
federal and state regulation, as well as by governmental action in the
country in which the foreign bank has its head office.
Obligations of foreign issuers involve certain additional risks. These
risks may include future unfavorable political and economic
developments, withholding taxes, seizures of foreign deposits,
currency controls, interest limitations, or other governmental
restrictions that might affect repayment of principal or payment of
interest, or the ability to honor a credit commitment. Additionally,
there may be less public information available about foreign entities.
Foreign issuers may be subject to less governmental regulation and
supervision than U.S. issuers. Foreign issuers also generally are not
bound by uniform accounting, auditing, and financial reporting
requirements comparable to those applicable to U.S. issuers.
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).
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. Tax-Exempt Fund
currently intends to participate in this program only as borrowers. A
fund will borrow through the program only when the costs are equal to
or lower than the costs of bank loans, and will lend through the
program only when the returns are higher than those available from an
investment in repurchase agreements. 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.
MONEY MARKET INSURANCE. Each fund participates in a mutual
insurance company solely with other funds advised by FMR or its
affiliates. This company provides insurance coverage for losses on
certain money market instruments held by a participating fund
(eligible instruments), including losses from nonpayment of principal
or interest or a bankruptcy or insolvency of the issuer or credit
support provider, if any. The insurance does not cover losses
resulting from changes in interest rates or other market developments.
Each fund pays an annual premium for the insurance coverage and may be
subject to a special assessment of up to approximately two and
one-half times the fund's annual gross premium if covered losses
exceed certain levels. A participating fund may recover no more than
$100 million annually, including all other claims of insured funds,
and may only recover if the amount of the loss exceeds 0.30% of its
eligible instruments. Each fund may incur losses regardless of the
insurance.
MONEY MARKET SECURITIES are high-quality, short-term obligations.
Money market securities may be structured to be, or may employ a trust
or other form so that they are, eligible investments for money market
funds. For example, put features can be used to modify the maturity of
a security or interest rate adjustment features can be used to enhance
price stability. If a structure fails to function as intended, adverse
tax or investment consequences may result. Neither the Internal
Revenue Service (IRS) nor any other regulatory authority has ruled
definitively on certain legal issues presented by certain structured
securities. Future tax or other regulatory determinations could
adversely affect the value, liquidity, or tax treatment of the income
received from these securities or the nature and timing of
distributions made by the funds.
MUNICIPAL LEASES and participation interests therein may take the form
of a lease, an installment purchase, or a conditional sale contract
and are issued by state and local governments and authorities to
acquire land or a wide variety of equipment and facilities. Generally,
a fund will not hold these obligations directly as a lessor of the
property, but will purchase a participation interest in a municipal
obligation from a bank or other third party. A participation interest
gives the purchaser a specified, undivided interest in the obligation
in proportion to its purchased interest in the total amount of the
issue.
Municipal leases frequently have risks distinct from those associated
with general obligation or revenue bonds. State constitutions and
statutes set forth requirements that states or municipalities must
meet to incur debt. These may include voter referenda, interest rate
limits, or public sale requirements. Leases, installment purchases, or
conditional sale contracts (which normally provide for title to the
leased asset to pass to the governmental issuer) have evolved as a
means for governmental issuers to acquire property and equipment
without meeting their constitutional and statutory requirements for
the issuance of debt. Many leases and contracts include
"non-appropriation clauses" providing that the governmental issuer has
no obligation to make future payments under the lease or contract
unless money is appropriated for such purposes by the appropriate
legislative body on a yearly or other periodic basis.
Non-appropriation clauses free the issuer from debt issuance
limitations. If a municipality stops making payments or transfers its
obligations to a private entity, the obligation could lose value or
become taxable.
MUNICIPAL MARKET DISRUPTION RISK. The value of municipal securities
may be affected by uncertainties in the municipal market related to
legislation or litigation involving the taxation of municipal
securities or the rights of municipal securities holders in the event
of a bankruptcy. Proposals to restrict or eliminate the federal income
tax exemption for interest on municipal securities are introduced
before Congress from time to time. Proposals also may be introduced
before state legislatures that would affect the state tax treatment of
a municipal fund's distributions. If such proposals were enacted, the
availability of municipal securities and the value of a municipal
fund's holdings would be affected and the Trustees would reevaluate
the fund's investment objectives and policies. Municipal bankruptcies
are relatively rare, and certain provisions of the U.S. Bankruptcy
Code governing such bankruptcies are unclear and remain untested.
Further, the application of state law to municipal issuers could
produce varying results among the states or among municipal securities
issuers within a state. These legal uncertainties could affect the
municipal securities market generally, certain specific segments of
the market, or the relative credit quality of particular securities.
Any of these effects could have a significant impact on the prices of
some or all of the municipal securities held by a fund, making it more
difficult for a fund to maintain a stable net asset value per share
(NAV) .
EDUCATION. In general, there are two types of education-related bonds;
those issued to finance projects for public and private colleges and
universities, and those representing pooled interests in student
loans. Bonds issued to supply educational institutions with funds are
subject to the risk of unanticipated revenue decline, primarily the
result of decreasing student enrollment or decreasing state and
federal funding. Among the factors that may lead to declining or
insufficient revenues are restrictions on students' ability to pay
tuition, availability of state and federal funding, and general
economic conditions. Student loan revenue bonds are generally offered
by state (or substate) authorities or commissions and are backed by
pools of student loans. Underlying student loans may be guaranteed by
state guarantee agencies and may be subject to reimbursement by the
United States Department of Education through its guaranteed student
loan program. Others may be private, uninsured loans made to parents
or students which are supported by reserves or other forms of credit
enhancement. Recoveries of principal due to loan defaults may be
applied to redemption of bonds or may be used to re-lend, depending on
program latitude and demand for loans. Cash flows supporting student
loan revenue bonds are impacted by numerous factors, including the
rate of student loan defaults, seasoning of the loan portfolio, and
student repayment deferral periods of forbearance. Other risks
associated with student loan revenue bonds include potential changes
in federal legislation regarding student loan revenue bonds, state
guarantee agency reimbursement and continued federal interest and
other program subsidies currently in effect.
ELECTRIC UTILITIES. The electric utilities industry has been
experiencing, and will continue to experience, increased competitive
pressures. Federal legislation in the last two years will open
transmission access to any electricity supplier, although it is not
presently known to what extent competition will evolve. Other risks
include: (a) the availability and cost of fuel, (b) the availability
and cost of capital, (c) the effects of conservation on energy demand,
(d) the effects of rapidly changing environmental, safety, and
licensing requirements, and other federal, state, and local
regulations, (e) timely and sufficient rate increases, and (f)
opposition to nuclear power.
HEALTH CARE. The health care industry is subject to regulatory action
by a number of private and governmental agencies, including federal,
state, and local governmental agencies. A major source of revenues for
the health care industry is payments from the Medicare and Medicaid
programs. As a result, the industry is sensitive to legislative
changes and reductions in governmental spending for such programs.
Numerous other factors may affect the industry, such as general and
local economic conditions; demand for services; expenses (including
malpractice insurance premiums); and competition among health care
providers. In the future, the following elements may adversely affect
health care facility operations: adoption of legislation proposing a
national health insurance program; other state or local health care
reform measures; medical and technological advances which dramatically
alter the need for health services or the way in which such services
are delivered; changes in medical coverage which alter the traditional
fee-for-service revenue stream; and efforts by employers, insurers,
and governmental agencies to reduce the costs of health insurance and
health care services.
HOUSING. Housing revenue bonds are generally issued by a state,
county, city, local housing authority, or other public agency. They
generally are secured by the revenues derived from mortgages purchased
with the proceeds of the bond issue. It is extremely difficult to
predict the supply of available mortgages to be purchased with the
proceeds of an issue or the future cash flow from the underlying
mortgages. Consequently, there are risks that proceeds will exceed
supply, resulting in early retirement of bonds, or that homeowner
repayments will create an irregular cash flow. Many factors may affect
the financing of multi-family housing projects, including acceptable
completion of construction, proper management, occupancy and rent
levels, economic conditions, and changes to current laws and
regulations.
TRANSPORTATION. Transportation debt may be issued to finance the
construction of airports, toll roads, highways, or other transit
facilities. Airport bonds are dependent on the general stability of
the airline industry and on the stability of a specific carrier who
uses the airport as a hub. Air traffic generally follows broader
economic trends and is also affected by the price and availability of
fuel. Toll road bonds are also affected by the cost and availability
of fuel as well as toll levels, the presence of competing roads and
the general economic health of an area. Fuel costs and availability
also affect other transportation-related securities, as do the
presence of alternate forms of transportation, such as public
transportation.
WATER AND SEWER. Water and sewer revenue bonds are often considered to
have relatively secure credit as a result of their issuer's
importance, monopoly status, and generally unimpeded ability to raise
rates. Despite this, lack of water supply due to insufficient rain,
run-off, or snow pack is a concern that has led to past defaults.
Further, public resistance to rate increases, costly environmental
litigation, and Federal environmental mandates are challenges faced by
issuers of water and sewer bonds.
PUT FEATURES entitle the holder to sell a security back to the issuer
or a third party at any time or at specified intervals. In exchange
for this benefit, a fund may accept a lower interest rate. Securities
with put features are subject to the risk that the put provider is
unable to honor the put feature (purchase the security). Put providers
often support their ability to buy securities on demand by obtaining
letters of credit or other guarantees from other entities. Demand
features, standby commitments, and tender options are types of put
features.
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 funds 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 funds 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 a fund's
yield and may be viewed as a form of leverage.
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). Short sales against the box could be used
to protect the NAV of the fund in anticipation of increased
interest rates, without sacrificing the current yield of the
securities sold short. If a fund enters into a short sale against the
box, it will be required to set aside securities equivalent in kind
and amount to the securities sold short (or securities convertible or
exchangeable into such securities) and will be required to hold such
securities while the short sale is outstanding. The fund will incur
transaction costs in connection with opening and closing short sales
against the box.
SOURCES OF CREDIT OR LIQUIDITY SUPPORT. Issuers may employ various
forms of credit and liquidity enhancements, including letters of
credit, guarantees, puts, and demand features, and insurance provided
by domestic or foreign entities such as banks and other financial
institutions. FMR may rely on its evaluation of the credit of the
credit or liquidity enhancement provider in determining whether to
purchase a security supported by such enhancement. In evaluating the
credit of a foreign bank or other foreign entities, FMR will consider
whether adequate public information about the entity is available and
whether the entity may be subject to unfavorable political or economic
developments, currency controls, or other government restrictions that
might affect its ability to honor its commitment. Changes in the
credit quality of the entity providing the enhancement could affect
the value of the security or a fund's share price.
STRIPPED SECURITIES are the separate income or principal components of
a debt security. The risks associated with stripped securities are
similar to those of other money market securities, although stripped
securities may be more volatile. U.S. Treasury securities that have
been stripped by a Federal Reserve Bank are obligations issued by the
U.S. Treasury.
Privately stripped government securities are created when a dealer
deposits a U.S. Treasury security or other U.S. Government security
with a custodian for safekeeping. The custodian issues separate
receipts for the coupon payments and the principal payment, which the
dealer then sells.
Because the SEC does not consider privately stripped government
securities to be U.S. Government securities for purposes of Rule 2a-7,
a fund must evaluate them as it would non-government securities
pursuant to regulatory guidelines applicable to money market funds.
TEMPORARY DEFENSIVE POLICIES. Tax-Exempt Fund reserves the right to
hold a substantial amount of uninvested cash or to invest more than
normally permitted in federally taxable obligations for temporary
defensive purposes.
VARIABLE AND FLOATING RATE SECURITIES provide for periodic adjustments
in the interest rate paid on the security. Variable rate securities
provide for a specified periodic adjustment in the interest rate,
while floating rate securities have interest rates that change
whenever there is a change in a designated benchmark rate. Some
variable or floating rate securities are structured with put features
that permit holders to demand payment of the unpaid principal balance
plus accrued interest from the issuers or certain financial
intermediaries.
WHEN-ISSUED AND FORWARD PURCHASE OR SALE TRANSACTIONS involve a
commitment to purchase or sell specific securities at a predetermined
price or yield in which payment and delivery take place after the
customary settlement period for that type of security. Typically, no
interest accrues to the purchaser until the security is delivered.
When purchasing securities pursuant to one of these transactions, the
purchaser assumes the rights and risks of ownership, including the
risks of price and yield fluctuations and the risk that the security
will not be issued as anticipated. Because payment for the securities
is not required until the delivery date, these risks are in addition
to the risks associated with a fund's investments. If a fund remains
substantially fully invested at a time when a purchase is outstanding,
the purchases may result in a form of leverage. When a fund has sold a
security pursuant to one of these transactions, the fund does not
participate in further gains or losses with respect to the security.
If the other party to a delayed-delivery transaction fails to deliver
or pay for the securities, a fund could miss a favorable price or
yield opportunity or suffer a loss.
A fund may renegotiate a when-issued or forward transaction and may
sell the underlying securities before delivery, which may result in
capital gains or losses for the fund.
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are placed
on behalf of each fund by FMR pursuant to authority contained in the
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 Contracts"), 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.
Each 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).
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, a
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 a 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 funds 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 LL (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 of each fund 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 years ended October 31, 1998, and 1997, the
fiscal period ended October 31, 1996, and the fiscal year ended July
31, 1996, Prime Fund and Treasury Fund paid no brokerage commissions.
For the fiscal years ended October 31, 1998, 1997 and 1996,
Tax-Exempt Fund paid no brokerage commissions.
For the fiscal year ended October 31, 1998 , the funds paid no
brokerage commissions to firms that provided research services.
The Trustees of each 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 funds 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 funds could purchase in the underwriting.
From time to time the Trustees will review whether the recapture for
the benefit of the funds of some portion of the brokerage commissions
or similar fees paid by the funds on portfolio transactions is legally
permissible and advisable. Each fund seeks to recapture soliciting
broker-dealer fees on the tender of portfolio securities, but at
present no other recapture arrangements are in effect. The Trustees
intend to continue to review whether recapture opportunities are
available and are legally permissible and, if so, to determine in the
exercise of their business judgment whether it would be advisable for
each fund to seek such recapture.
Although the Trustees and officers of each fund are substantially the
same as those of other funds managed by FMR or its affiliates,
investment decisions for each fund are made independently from those
of other funds managed by FMR or investment accounts managed by FMR
affiliates. It sometimes happens that the same security is held in the
portfolio of more than one of these funds or 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 each fund is
concerned. In other cases, however, the ability of the funds to
participate in volume transactions will produce better executions and
prices for the funds. It is the current opinion of the Trustees that
the desirability of retaining FMR as investment adviser to each fund
outweighs any disadvantages that may be said to exist from exposure to
simultaneous transactions.
VALUATION
Each class's NAV is the value of a single share. The NAV of
each class is computed by adding the class's pro rata share of the
value of the applicable fund's investments, cash, and other assets,
subtracting the class's pro rata share of the applicable fund's
liabilities, subtracting the liabilities allocated to the class, and
dividing the result by the number of shares of that class that are
outstanding.
Portfolio securities and other assets are valued on the basis of
amortized cost. This technique involves initially valuing an
instrument at its cost as adjusted for amortization of premium or
accretion of discount rather than its current market value. The
amortized cost value of an instrument may be higher or lower than the
price a fund would receive if it sold the instrument.
Securities of other open-end investment companies are valued at their
respective NAVs.
At such intervals as they deem appropriate, the Trustees consider the
extent to which NAV calculated by using market valuations would
deviate from the $1.00 per share calculated using amortized cost
valuation. If the Trustees believe that a deviation from a fund's
amortized cost per share may result in material dilution or other
unfair results to shareholders, the Trustees have agreed to take such
corrective action, if any, as they deem appropriate to eliminate or
reduce, to the extent reasonably practicable, the dilution or unfair
results. Such corrective action could include selling portfolio
instruments prior to maturity to realize capital gains or losses or to
shorten average portfolio maturity; withholding dividends; redeeming
shares in kind; establishing NAV by using available market quotations;
and such other measures as the Trustees may deem appropriate.
PERFORMANCE
A class may quote performance in various ways. All performance
information supplied by the funds in advertising is historical and is
not intended to indicate future returns. Each class's yield and return
fluctuate in response to market conditions and other factors.
YIELD CALCULATIONS. To compute the yield for each class of a fund for
a period, the net change in value of a hypothetical account containing
one share reflects the value of additional shares purchased with
dividends from the one original share and dividends declared on both
the original share and any additional shares. The net change is then
divided by the value of the account at the beginning of the period to
obtain a base period return. This base period return is annualized to
obtain a current annualized yield. Each class of a fund also may
calculate an effective yield by compounding the base period return
over a one-year period. In addition to the current yield, each class
of a fund may quote yields in advertising based on any historical
seven-day period. Yields for each class of a fund are calculated on
the same basis as other money market funds, as required by applicable
regulation.
Yield information may be useful in reviewing a class's performance and
in providing a basis for comparison with other investment
alternatives. However, a class's yield fluctuates, unlike investments
that pay a fixed interest rate over a stated period of time. When
comparing investment alternatives, investors should also note the
quality and maturity of the portfolio securities of respective
investment companies they have chosen to consider.
Investors should recognize that in periods of declining interest rates
a class's yield will tend to be somewhat higher than prevailing market
rates, and in periods of rising interest rates a class's yield will
tend to be somewhat lower. Also, when interest rates are falling, the
inflow of net new money to a fund from the continuous sale of its
shares will likely be invested in instruments producing lower yields
than the balance of the fund's holdings, thereby reducing a class's
current yield. In periods of rising interest rates, the opposite can
be expected to occur.
The tax-equivalent yield of a class of a municipal fund is the rate an
investor would have to earn from a fully taxable investment before
taxes to equal a class's tax-free yield. Tax-equivalent yields are
calculated by dividing a class's yield by the result of one minus a
specified federal income tax rate. If only a portion of a class's
yield is tax-exempt, only that portion is adjusted in the calculation.
The following table shows the effect of a shareholder's tax status on
effective yield under federal income tax laws for 1998. It shows the
approximate yield a taxable security must provide at various income
brackets to produce after-tax yields equivalent to those of
hypothetical federally tax-exempt obligations yielding from 2% to 8%.
Of course, no assurance can be given that a class of a fund will
achieve any specific tax-exempt yield. While Tax-Exempt Fund invests
principally in obligations whose interest is exempt from federal
income tax, other income received by the fund may be taxable.
EXPECTED 1999(DAGGER) TAX RATES AND TAX-EQUIVALENT YIELDS
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FEDERAL IF
MARGINAL INDIVI
RATE** DUAL
TAX-EX
EMPT
YIELD
IS:
TAXABLE 2% 3% 4% 5% 6% 7% 8%
INCOME*
SINGLE JOINT THEN
RETURN RETURN TAXABL
E-EQUI
VALENT
YIELD
IS:
$ 25,751 - $ 62,450 $ 43,051 - $ 104,050 28% 2.78% 4.17% 5.56% 6.94% 8.33% 9.72% 11.11%
$ 62,451 - $ 130,250 $ 104,051 - $ 158,550 31% 2.90% 4.35% 5.80% 7.25% 8.70% 10.15% 11.59%
$ 130,251 - $ 283,150 $ 158,551 - $ 283,150 36% 3.13% 4.69% 6.25% 7.81% 9.38% 10.94% 12.50%
$ 283,151 - OVER $ 283,151 - OVER 39.6% 3.31% 4.97% 6.62% 8.28% 9.93% 11.59% 13.25%
</TABLE>
* Net amount subject to federal income tax after deductions and
exemptions. Assumes ordinary income only.
** Excludes the impact of the phaseout of personal exemptions,
limitations on itemized deductions, and other credits, exclusions, and
adjustments which may increase a taxpayer's marginal tax rate. An
increase in a shareholder's marginal tax rate would increase that
shareholder's tax-equivalent yield.
(dagger) The 1999 tax rates are not expected to be materially
different from the expected 1999 tax rates shown above.
Tax-Exempt Fund may invest a portion of its assets in obligations that
are subject to federal income tax. When a fund invests in these
obligations, its tax-equivalent yields will be lower. In the table
above, tax-equivalent yields are calculated assuming investments are
100% federally tax-free.
RETURN CALCULATIONS. Returns quoted in advertising reflect all aspects
of a class's return, including the effect of reinvesting dividends and
capital gain distributions, and any change in a class's NAV over a
stated period. A class's return may be calculated by using the
performance data of a previously existing class prior to the date that
the new class commenced operations, adjusted to reflect differences in
sales charges but not 12b-1 fees. 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 a class 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. Average annual returns
covering periods of less than one year are calculated by determining a
class's return for the period, extending that return for a full year
(assuming that return remains constant over the year), and quoting the
result as an annual return. While average annual returns are a
convenient means of comparing investment alternatives, investors
should realize that a class's performance is not constant over time,
but changes from year to year, and that average annual returns
represent averaged figures as opposed to the actual year-to-year
performance of a class.
In addition to average annual returns, a class 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) in order to illustrate the
relationship of these factors and their contributions to return.
Returns may be quoted on a before-tax or after-tax basis. Returns may
or may not include the effect of a class's maximum sales charge.
Excluding a class's sales charge from a return calculation produces a
higher return figure. Returns, yields, and other performance
information may be quoted numerically or in a table, graph, or similar
illustration.
CALCULATING HISTORICAL FUND RESULTS. The following tables show
performance for each class of each fund. Class B and Class C have a
maximum CDSC of 5.00% and 1.00%, respectively, which is included in
the average annual and cumulative returns. Capital Reserves Class,
Daily Money Class, Class B and Class C have a 12b-1 fee of 0.50%,
0.25%, 1.00% and 1.00%, respectively which is included in the 7-day
yield, tax-equivalent yield, and average annual and cumulative
returns.
HISTORICAL FUND RESULTS. The following tables show 7-day yields and
returns for each class of Prime Fund, Treasury Fund and Tax-Exempt
Fund and the tax-equivalent yield for each class of Tax-Exempt Fund
for the fiscal period ended October 31, 1998. Capital Reserves Class
of each fund commenced operations on October 31, 1997. Capital
Reserves Class returns prior to that date are those of Daily Money
Class, the original class of each fund, which did not have a 12b-1 fee
until May 31, 1997. Returns from May 31, 1997 through October 31, 1997
reflect a 12b-1 fee of 0.25%. If Capital Reserves Class's 12b-1 fee
had been reflected, returns would have been lower. Effective May 31,
1997, Daily Money Class shares pay a 12b-1 fee of 0.25%. If the Daily
Money Class's 12b-1 fee had been reflected, returns prior to May 31,
1997 would have been lower. Class B of Treasury Fund commenced
operations on July 1, 1994. Class B's returns prior to that date are
those of Daily Money Class, the original class of the fund which did
not have a 12b-1 fee at that time. If Class B's 12b-1 fee had been
reflected, returns prior to July 1, 1994 would have been lower. Class
C of Treasury Fund commenced operations on November 3, 1997. Class C
returns prior to that date are those of Class B which reflect a 12b-1
fee of 1.00%. The initial offering of Class B began on July 1, 1994.
Class C returns prior to July 1, 1994 are those of Daily Money Class,
the original class of the fund, which did not have a 12b-1 fee at that
time. If Class C's 12b-1 fee had been reflected, returns prior to July
1, 1994 would have been lower.
The tax-equivalent yields for Tax-Exempt Fund are based on a 36%
federal income tax rate.
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AVERAGE CUMULATIV
ANNUAL E RETURNS
RETURNS
SEVEN-DA TAX- ONE YEAR FIVE YEARS TEN YEARS ONE YEAR FIVE YEARS TEN YEARS
Y YIELD EQUIVALENT
YIELD
PRIME 4.55% N/A 4.89% 4.76% 5.34% 4.89% 26.17% 68.26%
FUND
- -
CAPITAL
RESERV
ES
CLASS
PRIME 4.80% N/A 5.15% 4.81% 5.37% 5.15% 26.48% 68.68%
FUND
- -
DAILY
MONE
Y
CLASS
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
AVERAGE CUMULATIV
ANNUAL E RETURNS
RETURNS
SEVEN-DA TAX- ONE YEAR FIVE YEARS TEN YEARS ONE YEAR FIVE YEARS TEN YEARS
Y YIELD EQUIVALENT
YIELD
TREASU 4.24% N/A 4.78% 4.65% 5.24% 4.78% 25.52% 66.70%
RY
FUND
- -
CAPITAL
RESERV
ES
CLASS
TREASU 4.49% N/A 5.04% 4.70% 5.27% 5.04% 25.83% 67.12%
RY
FUND
- -
DAILY
MONE
Y
CLASS
TREASU 3.74% N/A 0.26% 3.88% N/A 0.26% 20.98% N/A
RY
FUND
- -
ADVIS
OR B
CLASS
TREASU 3.74% N/A 3.25% 4.05% 4.94% 3.25% 21.96% 61.98%
RY
FUND
- -
ADVIS
OR C
CLASS
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
AVERAGE CUMULATIV
ANNUAL E RETURNS
RETURNS
SEVEN-DA TAX- ONE YEAR FIVE YEARS TEN YEARS ONE YEAR FIVE YEARS TEN YEARS
Y YIELD EQUIVALENT
YIELD
Tax-E 2.37% 3.70% 2.78% 2.89% 3.50% 2.78% 15.33% 41.06%
xempt
Fund -
Capital
Reserv
es
Class
Tax-E 2.62% 4.09% 3.03% 2.94% 3.53% 3.03% 15.62% 41.41%
xempt
Fund -
Daily
Money
Class
</TABLE>
Note: If FMR had not reimbursed certain class expenses during these
periods, each class's returns would have been lower.
Note: If FMR had not reimbursed certain class expenses during these
periods, each class's yield and the tax equivalent yield for
Tax-Exempt Fund would have been:
Seven-Day Yield Tax-Equivalent Yield
Prime Fund - 4.44 % N/A
Capital
Reserves Class
Prime Fund - 4.69 % N/A
Daily Money
Class
Treasury Fund 4.12 % N/A
- - Capital
Reserves Class
Treasury Fund 4.38 % N/A
- - Daily Money
Class
Treasury Fund 3.57 % N/A
- - Advisor B
Class
Treasury Fund 3.05 % N/A
- - Advisor C
Class
Tax-Exempt 2.22 % 3.47 %
Fund - Capital
Reserves Class
Tax-Exempt 2.48 % 3.88 %
Fund - Daily
Money Class
The following tables show the income and capital elements of each
class's cumulative return. The tables compare each class's return to
the record of the Standard & Poor's 500 Index (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 CPI information
is as of the month-end closest to the initial investment date for each
class. The S&P 500 and DJIA comparisons are provided to show how each
class's return compared to the record of a broad unmanaged index of
common stocks and a narrower set of stocks of major industrial
companies, respectively, over the same period. Because each fund
invests in short-term fixed-income securities, common stocks represent
a different type of investment from the funds. Common stocks generally
offer greater growth potential than the funds, but generally
experience greater price volatility, which means greater potential for
loss. In addition, common stocks generally provide lower income than
fixed-income investments such as the funds. The S&P 500 and DJIA
returns are based on the prices of unmanaged groups of stocks and,
unlike each class's returns, do not include the effect of brokerage
commissions or other costs of investing.
The following tables show the growth in value of a hypothetical
$10,000 investment in each class of each fund during the 10-year
period ended 1998 or life of each fund, as applicable, 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.
During the 10-year period ended October 31, 1998, a hypothetical
$10,000 investment in Capital Reserves Class of Prime Fund would have
grown to $ 16,826 .
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
PRIME FUND - CAPITAL RESERVES CLASS INDEXES
Fiscal Value Value Value of Total Value S&P 500 DJIA Cost of Living
Year of of Reinvested
Ended Initial Reinv Capital Gain
$10,00 ested Distributions
0 Divide
Invest nd
ment Distrib
utions
1998 $ $ $ 0 $ 16,826 $ 51,835 $ 52,795 $ 13,644
10, 6,8
000 26
1997 $ $ $ 0 $ 16,042 $ 42,491 $ 44,953 $ 13,444
10, 6,0
000 42
1996 $ $ $ 0 $ 15,269 $ 32,162 $ 35,753 $ 13,170
10, 5,2
000 69
1995 $ $ $ 0 $ 14,540 $ 25,918 $ 27,599 $ 12,787
10, 4,5
000 40
1994 $ $ $ 0 $ 13,790 $ 20,498 $ 22,121 $ 12,438
10, 3,7
000 90
1993 $ $ $ 0 $ 13,336 $ 19,735 $ 20,275 $ 12,121
10, 3,3
000 36
1992 $ $ $ 0 $ 12,981 $ 17,169 $ 17,263 $ 11,797
10, 2,9
000 81
1991 $ $ $ 0 $ 12,528 $ 15,611 $ 15,947 $ 11,431
10, 2,5
000 28
1990 $ $ $ 0 $ 11,789 $ 11,693 $ 12,260 $ 11,106
10, 1,7
000 89
1989 $ $ $ 0 $ 10,905 $ 12,640 $ 12,774 $ 10,449
10, 905
000
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Capital
Reserves Class of Prime Fund on November 1, 1988, the net amount
invested in Capital Reserves Class shares was $10,000. The cost of the
initial investment ($10,000) together with the aggregate cost of
reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $16,826. If distributions had not been reinvested, the amount of
distributions earned from the class over time would have been smaller,
and cash payments for the period would have amounted to $5216 for
dividends. The fund did not distribute any capital gains during the
period. Capital Reserves class of Prime Fund commenced operations on
October 31, 1997. Capital Reserves class returns for the fund prior to
that date are those of Daily Money Class, the original class of the
fund, which did not have a 12b-1 fee until May 31, 1997. Returns from
May 31, 1997 through October 31, 1997 reflect a 12b-1 fee of 0.25%. If
Capital Reserves Class's 12b-1 fee had been reflected, returns would
have been lower.
During the 10-year period ended October 31, 1998, a hypothetical
$10,000 investment in Daily Money Class of Prime Fund would have grown
to $16,868.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
PRIME FUND - DAILY MONEY CLASS INDEXES
Fiscal Value Value Value of Total Value S&P 500 DJIA Cost of Living
Year of of Reinvested
Ended Initial Reinv Capital Gain
$10,00 ested Distributions
0 Divide
Invest nd
ment Distrib
utions
199 $ $ $ 0 $ 16,868 $ 51,835 $ 52,795 $ 13,644
8 10, 6,8
000 68
199 $ $ $ 0 $ 16,042 $ 42,491 $ 44,953 $ 13,444
7 10, 6,0
000 42
199 $ $ $ 0 $ 15,269 $ 32,162 $ 35,753 $ 13,170
6 10, 5,2
000 69
199 $ $ $ 0 $ 14,540 $ 25,918 $ 27,599 $ 12,787
5 10, 4,5
000 40
199 $ $ $ 0 $ 13,790 $ 20,498 $ 22,121 $ 12,438
4 10, 3,7
000 90
199 $ $ $ 0 $ 13,336 $ 19,735 $ 20,275 $ 12,121
3 10, 3,3
000 36
199 $ $ $ 0 $ 12,981 $ 17,169 $ 17,263 $ 11,797
2 10, 2,9
000 81
199 $ $ $ 0 $ 12,528 $ 15,611 $ 15,947 $ 11,431
1 10, 2,5
000 28
199 $ $ $ 0 $ 11,789 $ 11,693 $ 12,260 $ 11,106
0 10, 1,7
000 89
198 $ $ $ 0 $ 10,905 $ 12,640 $ 12,774 $ 10,449
9 10, 905
000
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Daily
Money Class of Prime Fund on November 1, 1988, the net amount invested
in Daily Money Class shares was $10,000. The cost of the initial
investment ($10,000) together with the aggregate cost of reinvested
dividends and capital gain distributions for the period covered (their
cash value at the time they were reinvested) amounted to $16,868. If
distributions had not been reinvested, the amount of distributions
earned from the class over time would have been smaller, and cash
payments for the period would have amounted to $5,241 for dividends.
The fund did not distribute any capital gains during the period.
Effective May 31, 1997, Daily Money Class shares of Prime Fund pay a
12b-1 fee of 0.25%. If Daily Money Class's 12b-1 fee had been
reflected, returns prior to May 31, 1997 would have been lower.
During the 10-year period ended October 31, 1998, a hypothetical
$10,000 investment in Capital Reserves Class of Treasury Fund would
have grown to $16,670.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
TREASURY FUND - CAPITAL RESERVES CLASS INDEXES
Fiscal Value Value Value of Total Value S&P 500 DJIA Cost of Living
Year of of Reinvested
Ended Initial Reinv Capital Gain
$10,00 ested Distributions
0 Divide
Invest nd
ment Distrib
utions
1998 $ $ $ 0 $ 16,670 $ 51,835 $ 52,795 $ 13,644
10, 6,6
000 70
1997 $ $ $ 0 $ 15,910 $ 42,491 $ 44,953 $ 13,444
10, 5,9
000 10
1996 $ $ $ 0 $ 15,157 $ 32,162 $ 35,753 $ 13,170
10, 5,1
000 57
1995 $ $ $ 0 $ 14,446 $ 25,918 $ 27,599 $ 12,787
10, 4,4
000 46
1994 $ $ $ 0 $ 13,714 $ 20,498 $ 22,121 $ 12,438
10, 3,7
000 14
1993 $ $ $ 0 $ 13,281 $ 19,735 $ 20,275 $ 12,121
10, 3,2
000 81
1992 $ $ $ 0 $ 12,933 $ 17,169 $ 17,263 $ 11,797
10, 2,9
000 33
1991 $ $ $ 0 $ 12,476 $ 15,611 $ 15,947 $ 11,431
10, 2,4
000 76
1990 $ $ $ 0 $ 11,764 $ 11,693 $ 12,260 $ 11,106
10, 1,7
000 64
1989 $ $ $ 0 $ 10,893 $ 12,640 $ 12,774 $ 10,449
10, 893
000
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Capital
Reserves Class of Treasury Fund on November 1, 1988, the net amount
invested in Capital Reserves Class shares was $10,000. The cost of the
initial investment ($10,000) together with the aggregate cost of
reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $16,670. If distributions had not been reinvested, the amount of
distributions earned from the class over time would have been smaller,
and cash payments for the period would have amounted to $5,123 for
dividends. The fund did not distribute any capital gains during the
period. Capital Reserves class of Treasury Fund commenced operations
on October 31, 1997. Capital Reserves class returns for the fund prior
to that date are those of Daily Money Class, the original class of the
fund, which did not have a 12b-1 fee until May 31, 1997. Returns from
May 31, 1997 through October 31, 1997 reflect a 12b-1 fee of 0.25%. If
Capital Reserves Class's 12b-1 fee had been reflected, returns would
have been lower.
During the 10-year period ended October 31, 1998, a hypothetical
$10,000 investment in Daily Money Class of Treasury Fund would have
grown to $16,712.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
TREASURY FUND - DAILY MONEY CLASS INDEXES
Fiscal Value Value Value of Total Value S&P 500 DJIA Cost of Living
Year of of Reinvested
Ended Initial Reinv Capital Gain
$10,00 ested Distributions
0 Divide
Invest nd
ment Distrib
utions
1998 $ $ $ 0 $ 16,712 $ 51,835 $ 52,795 $ 13,644
10, 6,7
000 12
1997 $ $ $ 0 $ 15,910 $ 42,491 $ 44,953 $ 13,444
10, 5,9
000 10
1996 $ $ $ 0 $ 15,157 $ 32,162 $ 35,753 $ 13,170
10, 5,1
000 57
1995 $ $ $ 0 $ 14,446 $ 25,918 $ 27,599 $ 12,787
10, 4,4
000 46
1994 $ $ $ 0 $ 13,714 $ 20,498 $ 22,121 $ 12,438
10, 3,7
000 14
1993 $ $ $ 0 $ 13,281 $ 19,735 $ 20,275 $ 12,121
10, 3,2
000 81
1992 $ $ $ 0 $ 12,933 $ 17,169 $ 17,263 $ 11,797
10, 2,9
000 33
1991 $ $ $ 0 $ 12,476 $ 15,611 $ 15,947 $ 11,431
10, 2,4
000 76
1990 $ $ $ 0 $ 11,764 $ 11,693 $ 12,260 $ 11,106
10, 1,7
000 64
1989 $ $ $ 0 $ 10,893 $ 12,640 $ 12,774 $ 10,449
10, 893
000
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Daily
Money Class of Treasury Fund on November 1, 1988, the net amount
invested in Daily Money Class shares was $10,000. The cost of the
initial investment ($10,000) together with the aggregate cost of
reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $16,712. If distributions had not been reinvested, the amount of
distributions earned from the class over time would have been smaller,
and cash payments for the period would have amounted to $5,148 for
dividends. The fund did not distribute any capital gains during the
period. Effective May 31, 1997, Daily Money Class shares of Treasury
Fund pay a 12b-1 fee of 0.25%. If Daily Money Class's 12b-1 fee had
been reflected, returns prior to May 31, 1997 would have been lower.
During the 10-year period ended October 31, 1998, a hypothetical
$10,000 investment in Advisor B Class of Treasury Fund would have
grown to $16,200.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
TREASURY FUND - ADVISOR B CLASS INDEXES
Fiscal Value Value Value of Total Value S&P 500 DJIA Cost of Living
Year of of Reinvested
Ended Initial Reinv Capital Gain
$10,00 ested Distributions
0 Divide
Invest nd
ment Distrib
utions
1998 $ $ $ 0 $ 16,200 $ 51,835 $ 52,795 $ 13,644
10, 6,2
000 00
1997 $ $ $ 0 $ 15,538 $ 42,491 $ 44,953 $ 13,444
10, 5,5
000 38
1996 $ $ $ 0 $ 14,912 $ 32,162 $ 33,753 $ 13,170
10, 4,9
000 12
1995 $ $ $ 0 $ 14,311 $ 25,918 $ 27,599 $ 12,787
10, 4,3
000 11
1994 $ $ $ 0 $ 13,683 $ 20,498 $ 22,121 $ 12,438
10, 3,6
000 83
1993 $ $ $ 0 $ 13,281 $ 19,735 $ 20,275 $ 12,121
10, 3,2
000 81
1992 $ $ $ 0 $ 12,933 $ 17,169 $ 17,263 $ 11,797
10, 2,9
000 33
1991 $ $ $ 0 $ 12,476 $ 15,611 $ 15,947 $ 11,431
10, 2,4
000 76
1990 $ $ $ 0 $ 11,764 $ 11,693 $ 12,260 $ 11,106
10, 1,7
000 64
1989 $ $ $ 0 $ 10,893 $ 12,640 $ 12,774 $ 10,449
10, 893
000
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Advisor B
Class of Treasury Fund on November 1, 1988, the net amount invested in
Class B shares was $10,000. The cost of the initial investment
($10,000) together with the aggregate cost of reinvested dividends and
capital gain distributions for the period covered (their cash value at
the time they were reinvested) amounted to $16,200. If distributions
had not been reinvested, the amount of distributions earned from the
class over time would have been smaller, and cash payments for the
period would have amounted to $4,835 for dividends. The fund did not
distribute any capital gains during the period. Class B of Treasury
Fund commenced operations on July 1, 1994. Class B's returns prior to
that date are those of Daily Money Class, the original class of the
fund which did not have a 12b-1 fee at that time. If Class B's 12b-1
fee had been reflected, returns prior to July 1, 1994 would have been
lower.
During the 10-year period ended October 31, 1998, a hypothetical
$10,000 investment in Advisor C Class of Treasury Fund would have
grown to $16,198.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
TREASURY FUND - ADVISOR C CLASS INDEXES
Fiscal Value Value Value Total Value S&P 500 DJIA Cost of Living
Year of of of
Ended Initial Reinv Reinv
$10,00 ested ested
0 Divide Capita
Invest nd l Gain
ment Distrib Distrib
utions utions
1998 $ $ $ 0 $ 16,198 $ 51,835 $ 52,795 $ 13,644
10, 6,1
000 98
1997 $ $ $ 0 $ 15,538 $ 42,491 $ 44,953 $ 13,444
10, 5,5
000 38
1996 $ $ $ 0 $ 14,912 $ 32,162 $ 35,753 $ 13,170
10, 4,9
000 12
1995 $ $ $ 0 $ 14,311 $ 25,918 $ 27,599 $ 12,787
10, 4,3
000 11
1994 $ $ $ 0 $ 13,683 $ 20,498 $ 22,121 $ 12,438
10, 3,6
000 83
1993 $ $ $ 0 $ 13,281 $ 19,735 $ 20,275 $ 12,121
10, 3,2
000 81
1992 $ $ $ 0 $ 12,933 $ 17,169 $ 17,263 $ 11,797
10, 2,9
000 33
1991 $ $ $ 0 $ 12,476 $ 15,611 $ 15,947 $ 11,431
10, 2,4
000 76
1990 $ $ $ 0 $ 11,764 $ 11,693 $ 12,260 $ 11,106
10, 1,7
000 64
1989 $ $ $ 0 $ 10,893 $ 12,640 $ 12,774 $ 10,449
10, 893
000
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Advisor C
Class of Treasury Fund on November 1, 1988, the net amount invested in
Class C shares was $10,000. The cost of the initial investment
($10,000) together with the aggregate cost of reinvested dividends and
capital gain distributions for the period covered (their cash value at
the time they were reinvested) amounted to $16,198. If distributions
had not been reinvested, the amount of distributions earned from the
class over time would have been smaller, and cash payments for the
period would have amounted to $4,834 for dividends. The fund did not
distribute any capital gains during the period. Class C of Treasury
Fund commenced operations on November 3, 1997. Class C returns prior
to that date are those of Class B which reflect a 12b-1 fee of 1.00%.
The initial offering of Class B began on July 1, 1994. Class C returns
prior to July 1, 1994 are those of Daily Money Class, the original
class of the fund, which did not have a 12b-1 fee at that time. If
Class C's 12b-1 fee had been reflected, returns prior to July 1, 1994
would have been lower.
During the 10-year period ended October 31, 1998, a hypothetical
$10,000 investment in Capital Reserves Class of Tax-Exempt Fund would
have grown to $14,106.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
TAX-EXEMPT FUND - CAPITAL RESERVES CLASS INDEXES
Fiscal Value Value Value of Total Value S&P 500 DJIA Cost of Living
Year of of Reinvested
Ended Initial Reinv Capital Gain
$10,00 ested Distributions
0 Divide
Invest nd
ment Distrib
utions
1998 $ $ $ 0 $ 14,106 $ 51,835 $ 52,795 $ 13,644
10, 4,1
000 06
1997 $ $ $ 0 $ 13,725 $ 42,491 $ 44,953 $ 13,444
10, 3,7
000 25
1996 $ $ $ 0 $ 13,312 $ 32,162 $ 35,753 $ 13,170
10, 3,3
000 12
1995 $ $ $ 0 $ 12,921 $ 25,918 $ 27,599 $ 12,787
10, 2,9
000 21
1994 $ $ $ 0 $ 12,501 $ 20,498 $ 22,121 $ 12,438
10, 2,5
000 01
1993 $ $ $ 0 $ 12,231 $ 19,735 $ 20,275 $ 12,121
10, 2,2
000 31
1992 $ $ $ 0 $ 11,978 $ 17,169 $ 17,263 $ 11,797
10, 1,9
000 78
1991 $ $ $ 0 $ 11,637 $ 15,611 $ 15,947 $ 11,431
10, 1,6
000 37
1990 $ $ $ 0 $ 11,140 $ 11,693 $ 12,260 $ 11,106
10, 1,1
000 40
1989 $ $ $ 0 $ 10,572 $ 12,640 $ 12,774 $ 10,449
10, 572
000
</TABLE>
Explanatory Notes: With an initial investment of $10,000 in Capital
Reserves Class of Tax-Exempt Fund on November 1, 1988, the net amount
invested in Capital Reserves Class shares was $10,000. The cost of the
initial investment ($10,000) together with the aggregate cost of
reinvested dividends and capital gain distributions for the period
covered (their cash value at the time they were reinvested) amounted
to $14,106. If distributions had not been reinvested, the amount of
distributions earned from the class over time would have been smaller,
and cash payments for the period would have amounted to $3,446 for
dividends. The fund did not distribute any capital gains during the
period. Capital Reserves Class of Tax-Exempt Fund commenced operations
on October 31, 1997. Capital Reserves Class returns for the fund prior
to that date are those of Daily Money Class, the original class of the
fund, which did not have a 12b-1 fee until May 31, 1997. Returns from
May 31, 1997 through October 31, 1997 reflect a 12b-1 fee of 0.25%. If
Capital Reserves Class's 12b-1 fee had been reflected, returns would
have been lower.
During the 10-year period ended October 31, 1998, a hypothetical
$10,000 investment in Daily Money Class of Tax-Exempt Fund would have
grown to $14,141.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
TAX-EXEMPT FUND - DAILY MONEY CLASS INDEXES
Fiscal Value Value Value of Total Value S&P 500 DJIA Cost of Living
Year of of Reinvested
Ended Initial Reinv Capital Gain
$10,00 ested Distributions
0 Divide
Invest nd
ment Distrib
utions
1998 $ $ $ 0 $ 14,141 $ 51,835 $ 52,795 $ 13,644
10, 4,1
000 41
1997 $ $ $ 0 $ 13,725 $ 42,491 $ 44,953 $ 13,444
10, 3,7
000 25
1996 $ $ $ 0 $ 13,312 $ 32,162 $ 35,753 $ 13,170
10, 3,3
000 12
1995 $ $ $ 0 $ 12,921 $ 25,918 $ 27,599 $ 12,787
10, 2,9
000 21
1994 $ $ $ 0 $ 12,501 $ 20,498 $ 22,121 $ 12,438
10, 2,5
000 01
1993 $ $ $ 0 $ 12,231 $ 19,735 $ 20,275 $ 12,121
10, 2,2
000 31
1992 $ $ $ 0 $ 11,978 $ 17,169 $ 17,263 $ 11,797
10, 1,9
000 78
1991 $ $ $ 0 $ 11,637 $ 15,611 $ 15,947 $ 11,431
10, 1,6
000 37
1990 $ $ $ 0 $ 11,140 $ 11,693 $ 12,260 $ 11,106
10, 1,1
000 40
1989 $ $ $ 0 $ 10,572 $ 12,640 $ 12,774 $ 10,449
10, 572
000
</TABLE>
With an initial investment of $10,000 in Daily Money Class of
Tax-Exempt Fund on November 1, 1988, the net amount invested in Daily
Money Class shares was $ 10,000 . The cost of the initial
investment ($10,000) together with the aggregate cost of reinvested
dividends and capital gain distributions for the period covered (their
cash value at the time they were reinvested) amounted to
$ 14,141 . If distributions had not been reinvested, the amount
of distributions earned from the class over time would have been
smaller, and cash payments for the period would have amounted to
$ 3,471 for dividends. The fund did not distribute any capital
gains during the period. Effective May 31, 1997, Daily Money
Class shares of Tax-Exempt Fund pay a 12b-1 fee of 0.25%. If Daily
Money Class's 12b-1 fee had been reflected, returns prior to May 31,
1997 would have been lower.
PERFORMANCE COMPARISONS. A class's performance may be compared to the
performance of other mutual funds in general, or to the performance of
particular types of mutual funds. These comparisons may be expressed
as mutual fund rankings prepared by Lipper Analytical Services, Inc.
(Lipper), an independent service located in Summit, New Jersey that
monitors the performance of mutual funds. 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. Lipper may also rank based on
yield. In addition to the mutual fund rankings, a class'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, a class's performance may also be compared to other
mutual funds tracked by financial or business publications and
periodicals. For example, a class may quote Morningstar, Inc. in its
advertising materials. Morningstar, Inc. is a mutual fund rating
service that rates mutual funds on the basis of risk-adjusted
performance. Rankings that compare the performance of Fidelity funds
to one another in appropriate categories over specific periods of time
may also be quoted in advertising.
A class may be compared in advertising to Certificates of Deposit
(CDs) or other investments issued by banks or other depository
institutions. Mutual funds differ from bank investments in several
respects. For example, a fund may offer greater liquidity or higher
potential returns than CDs, a fund does not guarantee your principal
or your return, and fund shares are not FDIC insured.
Fidelity may provide information designed to help individuals
understand their investment goals and explore various financial
strategies. Such information may include information about current
economic, market, and political conditions; materials that describe
general principles of investing, such as asset allocation,
diversification, risk tolerance, and goal setting; questionnaires
designed to help create a personal financial profile; worksheets used
to 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.
A class may compare its performance or the performance of securities
in which it may invest to averages published by IBC Financial Data,
Inc. of Ashland, Massachusetts. These averages assume reinvestment of
distributions. IBC's MONEY FUND REPORT AVERAGES(trademark)/Government,
which is reported in IBC's MONEY FUND REPORT(trademark), covers over
214 government money market funds. IBC's MONEY FUND REPORT
AVERAGES(trademark)/All Taxable, which is reported in IBC's MONEY FUND
REPORT(trademark), covers over 886 taxable money market funds.
IBC's MONEY FUND REPORT AVERAGES(trademark)/All Tax-Free, which is
reported in IBC's MONEY FUND REPORT(trademark), covers over 441
tax-free money market funds.
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.
A class may present its fund number, Quotron(trademark) number, and
CUSIP number, and discuss or quote the fund's current portfolio
manager.
A fund may be available for purchase through retirement plans or other
programs offering deferral of, or exemption from, income taxes, which
may produce superior after-tax returns over time. For example, a
$1,000 investment earning a taxable return of 10% annually would have
an after-tax value of $1,949 after ten years, assuming tax was
deducted from the return each year at a 31% rate. An equivalent
tax-deferred investment would have an after-tax value of $2,100 after
ten years, assuming tax was deducted at a 31% rate from the
tax-deferred earnings at the end of the ten-year period.
As of October 31, 1998, FMR advised over $ 32 billion in
municipal fund assets, $115 billion in taxable fixed-income fund
assets, $118 billion in money market fund assets, $ 436
billion in equity fund assets, $ 13 billion in international
fund assets, and $ 28 billion in Spartan fund assets. The funds
may reference the growth and variety of money market mutual funds and
the adviser's innovation and participation in the industry. The equity
funds under management figure represents the largest amount of equity
fund assets under management by a mutual fund investment adviser in
the United States, making FMR America's leading equity (stock) fund
manager. FMR, its subsidiaries, and affiliates maintain a worldwide
information and communications network for the purpose of researching
and managing investments abroad.
In addition to performance rankings, each class of a fund may compare
its total expense ratio to the average total expense ratio of similar
funds tracked by Lipper. A class's total expense ratio is a
significant factor in comparing bond and money market investments
because of its effect on yield.
ADDITIONAL PURCHASE, EXCHANGE AND REDEMPTION INFORMATION
CLASS B AND CLASS C SHARES ONLY
The contingent deferred sales charge (CDSC) on Class B and Class C
shares may be waived (1) in the case of disability or death, provided
that the shares are redeemed within one year following the death or
the initial determination of disability; (2) in connection with a
total or partial redemption related to certain distributions from
retirement plans or accounts at age 70 1/2, which are permitted
without penalty pursuant to the Internal Revenue Code; (3) in
connection with redemptions through the Fidelity Advisor Systematic
Withdrawal Program; or (4) (for Class C only) in connection with any
redemptions from an employee benefit plan (including 403(b) programs
but otherwise as defined by ERISA).
A sales load waiver form must accompany these transactions.
If the Trustees determine that existing conditions make cash payments
undesirable, redemption payments may be made in whole or in part in
securities or other property, valued for this purpose as they are
valued in computing each class's NAV. Shareholders receiving
securities or other property on redemption may realize a gain or loss
for tax purposes, and will incur any costs of sale, as well as the
associated inconveniences.
DISTRIBUTIONS AND TAXES
DIVIDENDS. Because each fund's income is primarily derived from
interest, dividends from the fund generally will not qualify for the
dividends-received deduction available to corporate shareholders. To
the extent that a municipal fund's income is designated as federally
tax-exempt interest, the dividends declared by the fund are also
federally tax-exempt. Short-term capital gains are taxable as
dividends, but do not qualify for the dividends-received deduction.
Tax-Exempt Fund purchases municipal securities whose interest FMR
believes is free from federal income tax. Generally, issuers or other
parties have entered into covenants requiring continuing compliance
with federal tax requirements to preserve the tax-free status of
interest payments over the life of the security. If at any time the
covenants are not complied with, or if the IRS otherwise determines
that the issuer did not comply with relevant tax requirements,
interest payments from a security could become federally taxable
retroactive to the date the security was issued. For certain types of
structured securities, the tax status of the pass-through of tax-free
income may also be based on the federal tax treatment of the
structure.
Interest on certain "private activity" securities is subject to the
federal alternative minimum tax (AMT), although the interest continues
to be excludable from gross income for other tax purposes. Interest
from private activity securities will be considered tax-exempt for
purposes of Tax-Exempt Fund's policies of investing so that at least
80% of its income distributions is free from federal income tax.
Interest from private activity securities is a tax preference item for
the purposes of determining whether a taxpayer is subject to the AMT
and the amount of AMT to be paid, if any.
A portion of the gain on municipal bonds purchased at market discount
after April 30, 1993 is taxable to shareholders as ordinary income,
not as capital gains. Dividends resulting from a recharacterization of
gain from the sale of bonds purchased at market discount after April
30, 1993 are not considered income for purposes of Tax-Exempt Fund's
policy of investing so that at least 80% of its income distributions
is free from federal income tax.
CAPITAL GAINS DISTRIBUTIONS. Each fund may distribute any net realized
capital gains once a year or more often, as necessary.
As of October 31, 1998, Prime Fund had a capital loss carryforward
aggregating approximately $ 737,000 . This loss carryforward, of
which $ 103,000 , $ 584,000 , $48,000 and $2,000
will expire on October 31, 2001, 2002, 2003 , and
2005 , respectively, is available to offset future capital
gains.
As of October 31, 1998, Treasury Fund had a capital loss carryforward
aggregating approximately $ 391,000 . This loss carryforward,
all of which will expire on October 31, 2001 , is
available to offset future capital gains.
As of October 31, 1998, Tax-Exempt Fund had a capital loss
carryforward aggregating approximately $ 68,000 . This loss
carryforward, of which $ 65,000 and $ 3,000 will expire on
October 31, 2004 and 2005 , respectively, is available to
offset future capital gains.
STATE AND LOCAL TAX ISSUES. For mutual funds organized as business
trusts, state law provides for a pass-through of the state and local
income tax exemption afforded to direct owners of U.S. Government
securities. Some states limit this pass-through to mutual funds that
invest a certain amount in U.S. Government securities, and some types
of securities, such as repurchase agreements and some agency-backed
securities, may not qualify for this benefit. The tax treatment of
your dividends from a fund will be the same as if you directly owned a
proportionate share of the U.S. Government securities. Because the
income earned on certain U.S. Government securities is exempt from
state and local personal income taxes, the portion of dividends from a
fund attributable to these securities will also be free from state and
local personal income taxes. The exemption from state and local
personal income taxation does not preclude states from assessing other
taxes on the ownership of U.S. Government securities.
TAX STATUS OF THE FUNDS. Each 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, each fund intends to
distribute substantially all of its net investment income and net
realized capital gains within each calendar year as well as on a
fiscal year basis, 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 each 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 a 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, Members of the Advisory Board, and executive officers of
the trust are listed below. The Board of Trustees governs each fund
and is responsible for protecting the interests of shareholders. The
Trustees are experienced executives who meet periodically throughout
the year to oversee each fund's activities, review contractual
arrangements with companies that provide services to each fund, and
review each 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 Trustees and Members of the
Advisory Board also 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 (68), Trustee and President, is Chairman, Chief
Executive Officer and a Director of FMR Corp.; a Director and Chairman
of the Board and of the Executive Committee of FMR; Chairman and a
Director of Fidelity Investments Money Management, Inc. (1998),
Fidelity Management & Research (U.K.) Inc., and Fidelity Management &
Research (Far East) Inc.
J. GARY BURKHEAD (57), Member of the Advisory Board (1997), is Vice
Chairman and a Member of the Board of Directors of FMR Corp. (1997)
and President of Fidelity Personal Investments and Brokerage Group
(1997). Previously, Mr. Burkhead served as President of Fidelity
Management & Research Company.
RALPH F. COX (66), 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 USA Waste Services,
Inc. (non-hazardous waste, 1993), CH2M Hill Companies (engineering),
Rio Grande, Inc. (oil and gas production), and Daniel Industries
(petroleum measurement equipment manufacturer). In addition, he is a
member of advisory boards of Texas A&M University and the University
of Texas at Austin.
PHYLLIS BURKE DAVIS (66), Trustee. Prior to her retirement in
September 1991, Mrs. Davis was the Senior Vice President of Corporate
Affairs of Avon Products, Inc. She is currently a Director of
BellSouth Corporation (telecommunications), Eaton Corporation
(manufacturing, 1991), and the TJX Companies, Inc. (retail stores),
and previously served as a Director of Hallmark Cards, Inc.
(1985-1991) and Nabisco Brands, Inc. In addition, she is a member of
the President's Advisory Council of The University of Vermont School
of Business Administration.
ROBERT M. GATES (55), 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 LucasVarity PLC
(automotive components and diesel engines), Charles Stark Draper
Laboratory (non-profit), NACCO Industries, Inc. (mining and
manufacturing), and TRW Inc. (original equipment and replacement
products). 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.
E. BRADLEY JONES (70), Trustee. Prior to his retirement in 1984, Mr.
Jones was Chairman and Chief Executive Officer of LTV Steel Company.
He is a Director of TRW Inc. (original equipment and replacement
products), Consolidated Rail Corporation, Birmingham Steel
Corporation, and RPM, Inc. (manufacturer of chemical products), and he
previously served as a Director of NACCO Industries, Inc. (mining and
manufacturing, 1985-1995), Hyster-Yale Materials Handling, Inc.
(1985-1995), and Cleveland-Cliffs Inc. (mining), and as a Trustee of
First Union Real Estate Investments. In addition, he serves as a
Trustee of the Cleveland Clinic Foundation, where he has also been a
member of the Executive Committee as well as Chairman of the Board and
President, a Trustee and member of the Executive Committee of
University School (Cleveland), and a Trustee of Cleveland Clinic
Florida.
DONALD J. KIRK (65), Trustee, is Executive-in-Residence (1995) at
Columbia University Graduate School of Business and a financial
consultant. From 1987 to January 1995, Mr. Kirk was a Professor at
Columbia University Graduate School of Business. Prior to 1987, he was
Chairman of the Financial Accounting Standards Board. Mr. Kirk is a
Director of General Re Corporation (reinsurance), and he previously
served as a Director of Valuation Research Corp. (appraisals and
valuations, 1993-1995). In addition, he serves as 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), a Member 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).
*PETER S. LYNCH (55), Trustee, is Vice Chairman and Director of FMR.
Prior to May 31, 1990, he was a Director of FMR and Executive Vice
President of FMR (a position he held until March 31, 1991); Vice
President of Fidelity Magellan (registered trademark) 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 (65), Trustee (1997), is the Vice President of
Finance for the University of North Carolina (16-school system, 1995).
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), Weeks Corporation of
Atlanta (real estate, 1994), Carolina Power and Light Company
(electric utility, 1996), and the Kenan Transport Co. (1996).
Previously, he was a Director of First American Corporation (bank
holding company, 1979-1996). In addition, Mr. McCoy serves as a member
of the Board of Visitors for the University of North Carolina at
Chapel Hill (1994) and for the Kenan-Flager Business School
(University of North Carolina at Chapel Hill, 1988).
GERALD C. McDONOUGH (70), Trustee and Chairman of the non-interested
Trustees, is Chairman of G.M. Management Group (strategic advisory
services). Mr. McDonough is a Director of York International Corp.
(air conditioning and refrigeration), Commercial Intertech Corp.
(hydraulic systems, building systems, and metal products, 1992), CUNO,
Inc. (liquid and gas filtration products, 1996), and Associated
Estates Realty Corporation (a real estate investment trust, 1993). Mr.
McDonough served as a Director of ACME-Cleveland Corp. (metal working,
telecommunications, and electronic products) from 1987-1996 and
Brush-Wellman Inc. (metal refining) from 1983-1997.
MARVIN L. MANN (65), Trustee (1993), is Chairman of the Board, of
Lexmark International, Inc. (office machines, 1991). Prior to 1991, he
held the positions of Vice President of International Business
Machines Corporation ("IBM") and President and General Manager of
various IBM divisions and subsidiaries. Mr. Mann is a Director of M.A.
Hanna Company (chemicals, 1993), Imation Corp. (imaging and
information storage, 1997).
*ROBERT C. POZEN (52), Trustee (1997) and Senior Vice President, is
also President and a Director of FMR (1997); and President and a
Director of Fidelity Investments Money Management, Inc. (1998),
Fidelity Management & Research (U.K.) Inc. (1997), and Fidelity
Management & Research (Far East) Inc. (1997). Previously, Mr. Pozen
served as General Counsel, Managing Director, and Senior Vice
President of FMR Corp.
THOMAS R. WILLIAMS (70), 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 ConAgra, Inc. (agricultural products), Georgia Power Company
(electric utility), National Life Insurance Company of Vermont,
American Software, Inc., and AppleSouth, Inc. (restaurants, 1992).
BOYCE I. GREER (41), is Vice President of Money Market Funds (1997),
Group Leader of the Money Market Group (1997), Senior Vice President
of FMR (1997), and Vice President of FIMM (1998). Mr. Greer served as
the Leader of the Fixed-Income Group for Fidelity Management Trust
Company (1993-1995) and was Vice President and Group Leader of
Municipal Fixed-Income Investments (1996-1997).
FRED L. HENNING, JR. (58), is Vice President of Fidelity's
Fixed-Income Group (1995), Senior Vice President of FMR (1995), and
Senior Vice President of FIMM (1998). Before assuming his current
responsibilities, Mr. Henning was head of Fidelity's Money Market
Division.
JOHN J. TODD ( 49 ), Vice President of Prime Fund
(199 8 ), is Vice President of other funds advised by FMR and an
employee of F IMM.
ROBERT LITTERST (39), Vice President of Treasury Fund (1997), is Vice
President of other funds advised by FMR and an employee of
F IMM.
SCOTT A. ORR (36), Vice President of Tax-Exempt Fund (1995), is Vice
President of other funds advised by FMR and an employee of
F IMM.
ERIC D. ROITER (50), Secretary (1998), is Vice President (1998) and
General Counsel of FMR (1998). Mr. Roiter was an Adjunct Member,
Faculty of Law, at Columbia University Law School (1996-1997). Prior
to joining Fidelity, Mr. Roiter was a partner at Debevoise & Plimpton
(1981-1997) and served as an Assistant General Counsel of the U.S.
Securities and Exchange Commission (1979-1981).
RICHARD A. SILVER (50), Treasurer (1997), is Treasurer of the Fidelity
funds and is an employee of FMR (1997). Before joining FMR, Mr. Silver
served as Executive Vice President, Fund Accounting & Administration
at First Data Investor Services Group, Inc. (1996-1997). Prior to
1996, Mr. Silver was Senior Vice President and Chief Financial Officer
at The Colonial Group, Inc. Mr. Silver also served as Chairman of the
Accounting/Treasurer's Committee of the Investment Company Institute
(1987-1993).
MATTHEW N. KARSTETTER (37), Deputy Treasurer (1998), is Deputy
Treasurer of the Fidelity funds 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).
STANLEY N. GRIFFITH (52), Assistant Vice President (1998), is
Assistant Vice President of Fidelity's Fixed-Income Funds (1998) and
an employee of FMR Corp.
JOHN H. COSTELLO (52), Assistant Treasurer, is an employee of FMR.
LEONARD M. RUSH (52), Assistant Treasurer (1994), is an employee of
FMR (1994). Prior to becoming Assistant Treasurer of the Fidelity
funds, Mr. Rush was Chief Compliance Officer of FMR Corp. (1993-1994)
and Chief Financial Officer of Fidelity Brokerage Services, Inc.
(1990-1993).
THOMAS J. SIMPSON (40), Assistant Treasurer (1996), is Assistant
Treasurer of Fidelity's Fixed-Income Funds (1998) and an employee of
FMR (1996). Prior to joining FMR, Mr. Simpson was Vice President and
Fund Controller of Liberty Investment Services (1987-1995).
The following table sets forth information describing the compensation
of each Trustee and Member of the Advisory Board of each fund for his
or her services for the fiscal year ended October 31, 1998, or
calendar year ended December 31, 1997, as applicable.
COMPENSATION TABLE
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Trustees and
Members Aggregate Aggregate Aggregate Total
of the Advisory Board Compensation Compensation Compensation Compensation
from Prime from Treasury from Tax-Exempt from the Fund
FundB,C, D FundB FundB Complex*,A
J. Gary Burkhead** $ 0 $ 0 $ 0 $ 0
Ralph F. Cox $ 1,787 $ 576 $ 245 $ 214,500
Phyllis Burke Davis $ 1,774 $ 573 $ 244 $ 210,000
Robert M. Gates*** $ 1,799 $ 581 $ 247 $ 176,000
Edward C. Johnson 3d** $ 0 $ 0 $ 0 $ 0
E. Bradley Jones $ 1,786 $ 576 $ 245 $ 211,500
Donald J. Kirk $ 1,823 $ 588 $ 250 $ 211,500
Peter S. Lynch** $ 0 $ 0 $ 0 $ 0
William O. McCoy**** $ 1,799 $ 581 $ 247 $ 214,500
Gerald C. McDonough $ 2,211 $ 714 $ 304 $ 264,500
Marvin L. Mann $ 1,775 $ 572 $ 243 $ 214,500
Robert C. Pozen** $ 0 $ 0 $ 0 $ 0
Thomas R. Williams $ 1,799 $ 580 $ 247 $ 214,500
</TABLE>
* Information is for the calendar year ended December 31, 1997
for 230 funds in the complex.
** Interested Trustees of the funds and Mr. Burkhead are
compensated by FMR.
*** Mr. Gates was elected to the Board of Trustees of Newbury
Street Trust on May 9, 1997
**** Mr. McCoy was elected to the Board of Trustees of Newbury
Street on May 9, 1997
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, 1997, the Trustees
accrued required deferred compensation from the funds as follows:
Ralph F. Cox, $75,000; Phyllis Burke Davis, $75,000; Robert M. Gates,
$62,500; 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, $53,699; Marvin L. Mann,
$53,699; and Thomas R. Williams, $62,462.
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, $806; Phyllis Burke Davis, $806;
Robert M. Gates, $806; E. Bradley Jones, $806; Donald J. Kirk, $806;
William O. McCoy, $806; Gerald C. McDonough, $940; Marvin L. Mann,
$806; and Thomas R. Williams, $806.
D Certain of the non-interested Trustees' aggregate
compensation from a fund includes accrued voluntary deferred
compensation as follows: Thomas R. Williams, $684, Prime Fund.
Under a deferred compensation plan adopted in September 1995 and
amended in November 1996 (the Plan), non-interested Trustees must
defer receipt of a portion of, and may elect to defer receipt of an
additional portion of, their annual fees. Amounts deferred under the
Plan are subject to vesting and are treated as though equivalent
dollar amounts had been invested in shares of a cross-section of
Fidelity funds including funds in each major investment discipline and
representing a majority of Fidelity's assets under management (the
Reference Funds). The amounts ultimately received by the Trustees
under the Plan will be directly linked to the investment performance
of the Reference Funds. Deferral of fees in accordance with the Plan
will have a negligible effect on a fund's assets, liabilities, and net
income per share, and will not obligate a fund to retain the services
of any Trustee or to pay any particular level of compensation to the
Trustee. A fund may invest in the Reference Funds under the Plan
without shareholder approval.
As of October 31, 1998 , the Trustees, Members of the Advisory
Board, and officers of each fund owned, in the aggregate, less than 1%
of each fund's total outstanding shares.
As of October 31, 1998 , the following owned of record or
beneficially 5% or more (up to and including 25%) of each class's
outstanding shares:
Prime Fund-Daily Money Class: Lincoln Financial Advisors, Fort
Wayne, IN (6.04%); Commonwealth Equity Services, Waltham, MA
(5.98%).
Prime Fund-Capital Reserves Class: Muriel Siebert & Co., Inc., New
York, NY (11.46%); Commonwealth Equity Services, Waltham, MA (9.47%);
Securities America, Inc., Omaha, NE (9.12%); H.D. Vest Investment
Securities Inc., Irving, TX (6.92%); MML Investors Services Inc.,
Springfield, MA (6.15%).
Treasury Fund-Capital Reserves Class: Muriel Siebert & Co., Inc.,
New York, NY (5.93%); Securities America, Inc., Omaha, NE (5.42%).
Treasury Fund-Advisor B Class: Advantage Capital Corp., Houston, TX
(22.21%).
Treasury Fund-Advisor C Class: Everen Securities Inc., Chicago, IL
(17.73%); Investors Capital Corp., Lynnfield, MA (16.86%); Boone
County National Bank, Columbia, MO (6.05%).
Tax-Exempt Fund-Daily Money Class: Chase Bank of Texas, Houston, TX
(8.53%); Lincoln Financial Advisors, Fort Wayne, IN (6.31%); First
National Bank of Maryland, Baltimore, MD (5.74%).
Tax-Exempt Fund-Capital Reserves Class: Securities America, Inc.,
Omaha, NE (17.63%); Commonwealth Equity Services, Waltham, MA
(12.81%); Muriel Siebert & Co., Inc., New York, NY (12.00%); Offerman
& Co., Minneapolis, MN (6.05%); MML Investors Services Inc.,
Springfield, MA (5.80%).
As of October 31 , 1998 , approximately 34.62% and
26.94 % of Treasury Fund's total outstanding shares were held by
First Union National Bank, Charlotte, NC and Chase Bank of Texas,
Houston, TX, respectively.
A shareholder owning of record or beneficially more than 25% of a
fund's outstanding shares may be considered a controlling person. That
shareholder's vote could have a more significant effect on matters
presented at a shareholders' meeting than votes of other shareholders.
CONTROL OF INVESTMENT ADVISERS
FMR Corp., organized in 1972, is the ultimate parent company of FMR
and FIMM. 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.
Fidelity investment personnel may invest in securities for their own
investment accounts pursuant to a code of ethics that sets forth all
employees' fiduciary responsibilities regarding the funds, establishes
procedures for personal investing and restricts certain transactions.
For example, all personal trades in most securities require
pre-clearance, and participation in initial public offerings is
prohibited. In addition, restrictions on the timing of personal
investing in relation to trades by Fidelity funds and on short-term
trading have been adopted.
MANAGEMENT CONTRACTS
Each 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
each 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 each fund with all necessary office
facilities and personnel for servicing the fund's investments,
compensates all officers of each fund and all Trustees who are
"interested persons" of the trust or of FMR, and all personnel of each
fund or FMR performing services relating to research, statistical and
investment activities.
In addition, FMR or its affiliates, subject to the supervision of the
Board of Trustees, provide the management and administrative services
necessary for the operation of each fund. These services include
providing facilities for maintaining each fund's organization;
supervising relations with custodians, transfer and pricing agents,
accountants, underwriters and other persons dealing with each fund;
preparing all general shareholder communications and conducting
shareholder relations; maintaining each fund's records and the
registration of each fund's shares under federal securities laws and
making necessary filings under state securities laws; developing
management and shareholder services for each 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, and pricing and bookkeeping agent, each
fund or each class thereof, as applicable, pays all of its expenses
that are not assumed by those parties. Each fund pays for the
typesetting, printing, and mailing of its proxy materials to
shareholders, legal expenses, and the fees of the custodian, auditor
and non-interested Trustees. Each 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 each fund's
transfer agent agreement, the transfer agent bears the costs of
providing these services to existing shareholders of the applicable
classes. Other expenses paid by each 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. Each 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 FEES. For the services of FMR under each management
contract, each fund pays FMR a monthly management fee at the annual
rate of 0.25% of the fund's average net assets throughout the month.
The following table shows the amount of management fees paid by each
fund to FMR for the past three fiscal years.
Fund Fiscal Years Ended Management Fees Paid to
FMR(dagger)
Prime Fund 10/31/98 $ 12,530,658
10/31/97 $ 9,982,329
10/31/96* $ 3,212,443
7/31/96 $ 12,172,452
Treasury Fund 10/31/98 $ 4,006,033
10/31/97 $ 5,998,124
10/31/96* $ 2,327,773
7/31/96 $ 10,004,781
Tax-Exempt Fund 10/31/98 $ 1,697,118
10/31/97 $ 1,851,325
10/31/96 $ 2,607,230
* For the period August 1, 1996 through October 31, 1996. The
fiscal year-end of Prime Fund and Treasury Fund changed from July 31
to October 31 in October 1996.
(dagger) On May 31, 1997, FMR reduced the management fee rate
paid by Prime Fund, Treasury Fund, and Tax-Exempt Fund from 0.50% to
0.25%.
FMR may, from time to time, voluntarily reimburse all or a portion of
a class's operating expenses (exclusive of interest, taxes, brokerage
commissions and extraordinary expenses), which is subject to revision
or termination. 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 a class's total returns
and yield, and repayment of the reimbursement by a class will lower
its total returns and yield.
During the past three fiscal periods, FMR voluntarily agreed to
reimburse Daily Money Class, Capital Reserves Class, Advisor B Class
and Advisor C Class, if and to the extent that its aggregate operating
expenses, including management fees, were in excess of an annual rate
of its average net assets. The tables below show the periods of
reimbursement and levels of expense limitations; the dollar amount of
management fees incurred under each fund's contract before
reimbursement; and the dollar amount of management fees reimbursed by
FMR under the expense reimbursement for each period.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Aggregate Fiscal Years Management Amount of
Operating Ended October Fee Before Management
Expense 31, Reimbursement Fee
Limitation Reimbursement
Prime 0.90% 1998 $ $
Fund 12,530,65 2,200,283
- - 8
Capita
l
Reserv
es
Class
Aggregate Fiscal Years Management Amount of
Operating Ended October Fee Before Management
Expense 31, Reimbursement Fee
Limitation Reimbursement
Prime 0.65% 1998 $ $
Fund 12,530,65 3,248,969
- - 8
Daily
Mone
y
Class
1997 $ $
9,982,329 2,609,321
1996* $ $ 819,006
3,212,443
July 31, 1996 $ $
12,172,45 2,935,819
2
Aggregate Fiscal Years Management Amount of
Operating Ended October Fee Before Management
Expense 31, Reimbursement Fee
Limitation Reimbursement
Treasu 0.90% 1998 $ $ 350,189
ry 4,006,033
Fund
- -
Capita
l
Reserv
es
Class
Aggregate Fiscal Years Management Amount of
Operating Ended October Fee Before Management
Expense 31, Reimbursement Fee
Limitation Reimbursement
Treasu 0.65% 1998 $ $
ry 4,006,033 1,392,964
Fund
- -
Daily
Mone
y
Class
1997 $ $
5,998,124 1,340,816
1996* $ $ 169,465
2,327,773
July 31, 1996 $ $ 910,404
10,004,78
1
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Periods of To Aggregate Fiscal Years Management Fee Amount of
Expense Operating Ended October Before Management
Limitation Expense 31, Reimbursement Fee
From Limitation
Reimbursement
Treasury Fund - January 1, -- 1.40% 1998 $ 4,006,033 $ 67,651
Advisor B Class 1997
1997 $ 5,998,124 $ 69,692
July 1, 1994 December 31, 1.35% 1996* $ 2,327,773 $ 23,973
1996
July 31, 1996 $ 10,004,781 $ 59,376
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Aggregate Operating Fiscal Years Ended Management Fee Amount of
Expense Limitation October 31, Before Reimbursement Management Fee
Reimbursement
Treasury Fund - 1.40% 1998** $ 4,006,033 $ 42,191
Advisor C Class
Aggregate Operating Fiscal Years Ended Management Fee Amount of
Expense Limitation October 31, Before Reimbursement Management Fee
Reimbursement
Tax-Exempt Fund - 0.90% 1998 $ 1,697,118 $ 257,199
Capital Reserves Class
Aggregate Operating Fiscal Years Ended Management Fee Amount of
Expense Limitation October 31, Before Reimbursement Management Fee
Reimbursement
Tax-Exempt Fund - 0.65% 1998 $ 1,697,118 $ 699,858
Daily Money Class
1997 $ 1,851,325 $ 636,733
1996 $ 2,607,230 $ 543,729
</TABLE>
* For the period August 1, 1996 through October 31, 1996. The
fiscal year-end of Prime Fund and Treasury Fund changed from July 31
to October 31 in October 1996.
** For the period November 3, 1997 (commencement of sale of
Advisor C Class shares) through October 31, 1998.
SUB-ADVISERS. FMR has entered into a sub-advisory agreement with FIMM
pursuant to which FIMM has primary responsibility for choosing
investments for the funds. Previously, FMR Texas Inc. (FMR Texas)
had primary responsibility for providing investment management
services to the funds. On January 23, 1998, FMR Texas was merged into
FIMM, which succeeded to the operations of FMR Texas.
Under the terms of the sub-advisory agreements for Prime Fund,
Treasury Fund, and Tax-Exempt Fund, FMR pays FIMM fees equal to 50% of
the management fee payable to FMR under its management contract with
each fund. The fees paid to FIMM are not reduced by any voluntary or
mandatory expense reimbursements that may be in effect from time to
time.
Fees paid to FMR Texas and FIMM by FMR on behalf of Prime Fund,
Treasury Fund, and Tax-Exempt Fund for the past three fiscal years are
shown in the table below.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Fund Fiscal Year Ended Fees Paid to FIMM Fees Paid to FMR Texas
Prime Fund 10/31/98* $ 4,840,610 $ 1,424,719
10/31/97 N/A $ 3,257,703
10/31/96** N/A $ 900,563
7/31/96 N/A $ 3,398,817
Treasury Fund 10/31/98* $ 1,547,537 $ 455,480
10/31/97 N/A $ 1,691,929
10/31/96** N/A $ 521,771
7/31/96 N/A $ 2,098,350
Tax-Exempt Fund 10/31/98* $ 655,599 $ 192,960
10/31/97 N/A $ 584,482
10/31/96 N/A $ 627,563
</TABLE>
* For the period January 23, 1998 through October 31, 1998, FMR
paid fees to FIMM.
** For the period August 1, 1996 through October 31, 1996. The
fiscal year-end of Prime Fund and Treasury Fund changed from July 31
to October 31 in October 1996.
DISTRIBUTION SERVICES
Each 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 agreements
call for FDC to use all reasonable efforts, consistent with its other
business, to secure purchasers for shares of the fund, which are
continuously offered at NAV. Promotional and administrative expenses
in connection with the offer and sale of shares are paid by FMR.
Sales charge revenues collected and retained by FDC for the past three
fiscal years are shown in the table below.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
CDSC Revenue
Fiscal Year Ended Amount Paid to Amount Retained
FDC by FDC
Treasury Fund October 31, 1998 $ 290,208 $ 290,208
- - Advisor B
Class
October 31, 1997 $ 152,671 $ 152,671
October 31, 1996* $ 26,013 $ 26,013
July 31, 1996 $ 33,539 $ 33,539
Treasury Fund October 31, 1998** $ 22,524 $ 22,524
- - Advisor C
Class
</TABLE>
* For the period August 1, 1996 through October 31, 1996. The
fiscal year-end of Treasury Fund changed from July 31 to October
31 in October 1996.
** For the period November 3, 1997 (commencement of sale of
Advisor C Class shares) through October 31, 1998.
The Trustees have approved Distribution and Service Plans on behalf of
Capital Reserves Class and Daily Money Class of Prime Fund, Treasury
Fund and Tax-Exempt Fund, and Advisor B Class, and Advisor C Class of
Treasury Fund (the Plans) pursuant to Rule 12b-1 under the 1940 Act
(the Rule). The Rule provides in substance that a mutual fund may not
engage directly or indirectly in financing any activity that is
primarily intended to result in the sale of shares of the fund except
pursuant to a plan approved on behalf of the fund under the Rule. The
Plans, as approved by the Trustees, allow Capital Reserves Class,
Daily Money Class, Advisor B Class (Class B), and Advisor C Class
(Class C) of the funds and FMR to incur certain expenses that might be
considered to constitute direct or indirect payment by the funds of
distribution expenses.
Pursuant to the Capital Reserves Class Plan for each of
Prime Fund, Treasury Fund and Tax-Exempt Fund , FDC is paid a
monthly 12b-1 fee at an annual rate of 0.50% of Capital Reserves
Class's average net assets determined at the close of business on each
day throughout the month.
FDC may reallow to intermediaries, such as banks, broker-dealers
and other service-providers, up to an annual rate of 0.50% of the
average net assets they maintain, for providing services intended to
result in the sale of Capital Reserves Class shares and/or shareholder
support services.
Pursuant to the Daily Money Class Plan for each of Prime
Fund, Treasury Fund and Tax-Exempt Fund , FDC is paid a monthly
12b-1 fee at an annual rate of 0.25% of Daily Money Class's average
net assets determined at the close of business on each day throughout
the month.
FDC may reallow to intermediaries, such as banks, broker-dealers
and other service-providers, up to an annual rate of 0.25% of the
average net assets they maintain, for providing services intended to
result in the sale of Daily Money Class shares and/or shareholder
support services. Intermediaries that maintain an aggregate balance of
at least $50,000 in Daily Money Class shares are eligible for
compensation.
Pursuant to the Class B Plan, FDC is paid a monthly 12b-1
(distribution) fee at an annual rate of 0.75% of Class B's average net
assets determined at the close of business on each day throughout the
month. Class B also pays FDC a monthly 12b-1 (service) fee at an
annual rate of 0.25% of its average net assets determined at the close
of business on each day throughout the month.
Currently, FDC retains the full amount of 12b-1 (distribution) fees
paid by Class B as compensation for providing services intended to
result in the sale of Class B shares, and FDC may reallow up to the
full amount of 12b-1 (service) fees paid by Class B to intermediaries,
such as banks, broker-dealers and other service-providers for
providing shareholder support services.
Pursuant to the Class C Plan, FDC is paid a monthly 12b-1
(distribution) fee at an annual rate of 0.75% of Class C's average net
assets determined at the close of business on each day throughout the
month. Class C also pays FDC a monthly 12b-1 (service) fee at an
annual rate of 0.25% of its average net assets determined at the close
of business on each day throughout the month.
Currently and except as provided below, for the first year of
investment, FDC retains the full amount of 12b-1 (distribution) fees
paid by Class C as compensation for providing services intended to
result in the sale of Class C shares and retains the full-amount of
12b-1 (service) fees paid by Class C for providing shareholder support
services. Normally, after the first year of investment, FDC may
reallow up to the full amount of 12b-1 (distribution) fees paid by
Class C to intermediaries, such as banks, broker-dealers and other
service-providers for providing services intended to result in the
sale of Class C shares, and may reallow up to the full amount of 12b-1
(service) fees paid by Class C to intermediaries for providing
shareholder support services. For purchases of Class C shares made for
an employee benefit plan (including 403(b) programs, but otherwise as
defined in ERISA) or through reinvest ment of dividends or
capital gain s distributions, during the first year of
investment and thereafter, FDC may reallow up to the full amount of
12b-1 (distribution) fees paid by such Class C shares to
intermediaries for providing services intended to result in the sale
of Class C shares and may reallow up to the full amount of 12b-1
(service) fees paid by such Class C shares to intermediaries for
providing shareholder support services.
For the fiscal year ended October 31, 1998, Capital Reserves Class
paid FDC 12b-1 fees of $ 12,546,290 , of which FDC paid
$ 12,366,299 to intermediaries and retained $ 179,991 .
Amounts retained by FDC represent fees paid to FDC but not yet
reallowed to intermediaries as of the close of the period reported and
fees paid to FDC that are not eligible to be reallowed to
intermediaries. Amounts not eligible for reallowance are retained by
FDC for use in its capacity as distributor.
For the fiscal year ended October 31, 1998, Daily Money Class paid FDC
12b-1 fees of $ 11,834,557 , of which FDC paid $ 11,509,090
to intermediaries and retained $ 325,467 . Amounts retained by
FDC represent fees paid to FDC but not yet reallowed to intermediaries
as of the close of the period reported and fees paid to FDC that are
not eligible to be reallowed to intermediaries. Amounts not eligible
for reallowance are retained by FDC for use in its capacity as
distributor.
For the fiscal year ended October 31, 1998, Class B paid FDC 12b-1
(distribution) fees of $ 336,532 , of which FDC paid
$ 12,401 to intermediaries and retained $ 324,131 . These
amounts are retained by FDC for use in its capacity as distributor.
In addition, for the fiscal year ended October 31, 1998, Class B paid
FDC 12b-1 (service) fees of $ 95,642 , of which FDC paid
$ 95,235 to intermediaries and retained $ 317 . Amounts
retained by FDC represent fees paid to FDC but not yet reallowed to
intermediaries as of the close of the period reported and fees paid to
FDC that are not eligible to be reallowed to intermediaries. Amounts
not eligible for reallowance are retained by FDC for use in its
capacity as distributor.
For the fiscal year ended October 31, 1998, Class C paid FDC 12b-1
(distribution) fees of $ 54,206 , of which FDC paid $ 0 to
intermediaries and retained $ 54,206 . Amounts retained by FDC
represent fees paid to FDC but not yet reallowed to intermediaries as
of the close of the period reported and fees paid to FDC that are not
eligible to be reallowed to intermediaries. Amounts not eligible for
reallowance are retained by FDC for use in its capacity as
distributor.
In addition, for the fiscal year ended October 31, 1998, Class C paid
FDC 12b-1 (service) fees of $ 18,068 , of which FDC paid
$ 393 to intermediaries and retained $ 17,675 . Amounts
retained by FDC represent fees paid to FDC but not yet reallowed to
intermediaries as of the close of the period reported and fees paid to
FDC that are not eligible to be reallowed to intermediaries. Amounts
not eligible for reallowance are retained by FDC for use in its
capacity as distributor.
Under each 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. Each 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 Daily Money Class, Capital Reserves Class,
Class B, and Class C shares and/or shareholder support services,
including payments made to intermediaries that provide those services.
Currently, the Board of Trustees has authorized such payments for
Daily Money Class, Capital Reserves Class, Class B, and Class C
shares .
Prior to approving each 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 applicable class of each fund and its shareholders. To the
extent that each Plan gives FMR and FDC greater flexibility in
connection with the distribution of shares of the applicable class,
additional sales of fund shares or stabilization of cash flows may
result. Furthermore, certain shareholder support services may be
provided more effectively under the Plans by local entities with whom
shareholders have other relationships.
Each Plan does not provide for specific payments by the applicable
class of any of the expenses of FDC, or obligate FDC or FMR to perform
any specific type or level of distribution activities or incur any
specific level of expense in connection with distribution activities.
The Glass-Steagall Act generally prohibits federally and state
chartered or supervised banks from engaging in the business of
underwriting, selling or distributing securities. Although the scope
of this prohibition under the Glass-Steagall Act has not been clearly
defined by the courts or appropriate regulatory agencies, FDC believes
that the Glass-Steagall Act should not preclude a bank from performing
shareholder support services, or servicing and recordkeeping
functions. FDC intends to engage banks only to perform such functions.
However, changes in federal or state statutes and regulations
pertaining to the permissible activities of banks and their affiliates
or subsidiaries, as well as further judicial or administrative
decisions or interpretations, could prevent a bank from continuing to
perform all or a part of the contemplated services. If a bank were
prohibited from so acting, the Trustees would consider what actions,
if any, would be necessary to continue to provide efficient and
effective shareholder services. In such event, changes in the
operation of the funds might occur, including possible termination of
any automatic investment or redemption or other services then provided
by the bank. It is not expected that shareholders would suffer any
adverse financial consequences as a result of any of these
occurrences. In addition, state securities laws on this issue may
differ from the interpretations of federal law expressed herein, and
banks and other financial institutions may be required to register as
dealers pursuant to state law.
Each fund may execute portfolio transactions with, and purchase
securities issued by, depository institutions that receive payments
under the Plans. No preference for the instruments of such depository
institutions will be shown in the selection of investments.
TRANSFER AND SERVICE AGENT AGREEMENTS
Each class of Prime Fund and Treasury Fund has entered into a transfer
agent agreement with FIIOC, an affiliate of FMR. Under the terms of
the agreements, FIIOC performs transfer agency, dividend disbursing,
and shareholder services for each class of each fund.
Each class of Tax-Exempt Fund has entered into a transfer agent
agreement with UMB, which is located at 1010 Grand Avenue, Kansas
City, Missouri. Under the terms of the agreements, UMB provides
transfer agency, dividend disbursing, and shareholder services for
each class of the fund. UMB in turn has entered into a sub-transfer
agent agreement with FIIOC. Under the terms of the sub-agreement,
FIIOC performs all processing activities associated with providing
these services for each class of the fund and receives all related
transfer agency fees paid to UMB.
For providing transfer agency services, FIIOC receives an asset-based
fee paid monthly with respect to each account in a fund.
FIIOC pays out-of-pocket expenses associated with providing transfer
agent services. In addition, FIIOC bears the expense of typesetting,
printing, and mailing prospectuses, statements of additional
information, and all other reports, notices, and statements to
existing shareholders, with the exception of proxy statements.
Prime Fund and Treasury Fund have also entered into service agent
agreements with FSC, an affiliate of FMR. Under the terms of the
agreements, FSC calculates the NAV and dividends for each class of
each fund and maintains each fund's portfolio and general accounting
records.
Tax-Exempt Fund has also entered into a service agent agreement with
UMB. Under the terms of the agreement, UMB provides pricing and
bookkeeping services for the fund. UMB in turn has entered into a
sub-service agent agreement with FSC. Under the terms of the
sub-agreement, FSC performs all processing activities associated with
providing these services, including calculating the NAV and dividends
for each class of the fund and maintaining the fund's portfolio and
general accounting records, and receives all related pricing and
bookkeeping fees paid to UMB.
For providing pricing and bookkeeping services, FSC receives a monthly
fee based on each fund's average daily net assets throughout the
month. The annual fee rates for pricing and bookkeeping services are
.0175% for money market funds of the first $500 million of average net
assets and .0075% for money market funds of average net assets in
excess of $500 million. The fee, not including reimbursement for
out-of-pocket expenses, is limited to a minimum of $40,000 and a
maximum of $800,000 per year.
Pricing and bookkeeping fees, including reimbursement for
out-of-pocket expenses, paid by the funds to FSC for the past three
fiscal years are shown in the table below.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Fund 1998 1997 1996 1996
Prime Fund $ 430,180 * $ 240,888* $ 60,667** $ 233,579***
Treasury Fund $ 171,942 * $ 160,798* $ 47,493** $ 200,897***
Tax-Exempt $ 126,054 * $ 100,283* $ 107,140* N/A
Fund
</TABLE>
* Year ended October 31
** For the period August 1, 1996 through October 31, 1996. The
fiscal year-end of Prime Fund and Treasury Fund changed from July 31
to October 31 in October 1996.
*** Year ended July 31
DESCRIPTION OF THE TRUST
TRUST ORGANIZATION. Prime Fund, Treasury Fund, and Tax-Exempt Fund are
funds of Newbury Street Trust, an open-end management investment
company organized as a Delaware business trust on June 20, 1991. On
May 30, 1997, Newbury Street Trust changed its name from Daily
Tax-Exempt Money Fund to Newbury Street Trust. Currently, there are
three funds in Newbury Street Trust: Prime Fund, Treasury Fund, and
Tax-Exempt Fund. The Trustees are permitted to create additional funds
in the trust and to create additional classes of the funds.
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, except that liabilities and
expenses may be allocated to a particular class. Any general expenses
of the trust shall be allocated between or among any one or more of
the funds or classes.
SHAREHOLDER LIABILITY. The trust is a business trust organized under
Delaware law. Delaware law provides that shareholders shall be
entitled to the same limitations of personal liability extended to
stockholders of private corporations for profit. The courts of some
states, however, may decline to apply Delaware law on this point. The
Trust Instrument contains an express disclaimer of shareholder
liability for the debts, liabilities, obligations, and expenses of the
trust. The Trust Instrument provides that the trust 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 trust or the Trustees
relating to the trust or to a fund shall include a provision limiting
the obligations created thereby to the trust or to one or more funds
and its or their assets. The Trust Instrument further provides that
shareholders of a fund shall not have a claim on or right to any
assets belonging to any other fund.
The Trust Instrument provides for indemnification out of each 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 Trust Instrument also
provides that each fund shall, upon request, assume the defense of any
claim made against any shareholder for any act or obligation of the
fund and satisfy any judgment thereon. Thus, the risk of a shareholder
incurring financial loss on account of shareholder liability is
limited to circumstances in which Delaware law does not apply, no
contractual limitation of liability was in effect, and a fund is
unable to meet its obligations. FMR believes that, in view of the
above, the risk of personal liability to shareholders is extremely
remote. Claims asserted against one class of shares may subject
holders of another class of shares to certain liabilities.
VOTING RIGHTS. Each 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, by fund and by class.
The shares have no preemptive or for Capital Reserves Class, Daily
Money Class and Advisor C Class shares, conversion rights. Shares are
fully paid and nonassessable, except as set forth under the heading
"Shareholder Liability" above.
The trust or any of its funds may be terminated upon the sale of its
assets to another open-end management investment company or series
thereof, or upon liquidation and distribution of its assets. Generally
such terminations must be approved by a vote of shareholders. In the
event of the dissolution or liquidation of the trust, shareholders of
each of its funds are entitled to receive the underlying assets of
such fund available for distribution. In the event of the dissolution
or liquidation of a fund, shareholders of that fund are entitled to
receive the underlying assets of the fund available for distribution.
Under the Trust Instrument, the Trustees may, without shareholder
vote, in order to change the form of organization of the trust cause
the trust to merge or consolidate with one or more trusts,
partnerships, associations, limited liability companies or
corporations, as long as the surviving entity is an open-end
management investment company, or is a fund thereof, that will succeed
to or assume the trust's registration statement, or cause the trust to
incorporate under Delaware law.
CUSTODIAN. The Bank of New York, 110 Washington Street, New York, New
York, is custodian of the assets of Prime Fund and Treasury Fund (the
taxable funds). UMB Bank, n.a., 1010 Grand Avenue, Kansas City,
Missouri, is custodian of the assets of the Tax-Exempt Fund. Each
custodian is responsible for the safekeeping of a fund's assets and
the appointment of any subcustodian banks and clearing agencies. The
Chase Manhattan Bank, headquartered in New York, also may serve as
special purpose custodian of certain assets of the taxable funds 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. PricewaterhouseCoopers LLP, One Post Office Square,
Boston, Massachusetts serves as the trust's independent
accountant. The auditor examines financial statements for the funds
and provides other audit, tax, and related services.
FINANCIAL STATEMENTS
Each fund's financial statements and financial highlights for the
fiscal year ended October 31, 1998, and reports of the auditors, are
included in the funds' Annual Report and are incorporated herein by
reference.
APPENDIX
Fidelity, Fidelity Investments, Fidelity Investments & (Pyramid)
Design, the Pyramid Design , and Magellan are registered
trademarks of FMR Corp.
The third party marks appearing above are the marks of their
respective owners.
Newbury Street Trust
PART C. OTHER INFORMATION
Item 23. Exhibits
(a) (1) Trust Instrument for Daily Tax-Exempt Money Fund II, dated
June 20, 1991 is incorporated herein by reference to Exhibit 1(a) of
Post-Effective Amendment No. 20.
(2) Certificate of Trust for Daily Tax-Exempt Money Fund II, dated
June 20, 1991, is incorporated herein by reference to Exhibit 1(b) of
Post-Effective Amendment No. 17.
(3) Certificate of Amendment of Daily Tax-Exempt Money Fund II to
Daily Tax-Exempt Money Fund, dated January 29, 1992 is incorporated
herein by reference to Exhibit 1(c) of Post-Effective Amendment No.
26.
(4) Supplement to Trust Instrument of Daily Tax-Exempt Money Fund,
dated March 31, 1997, is incorporated herein by reference to Exhibit
1(d) of Post-Effective Amendment No. 29.
(5) Certificate of Amendment of Daily Tax-Exempt Money Fund to
Newbury Street Trust is incorporated herein by reference to Exhibit
1(e) of Post-Effective Amendment No. 30.
(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 dated May 30, 1997, between Newbury Street
Trust, on behalf of Treasury Fund, and Fidelity Management & Research
Company is incorporated herein by reference to Exhibit 5(a) of
Post-Effective Amendment No. 32.
(2) Sub-Advisory Agreement dated December 30, 1991, between Fidelity
Management & Research Co. and FMR Texas Inc. (with respect to Daily
Tax-Exempt Money Fund II (currently known as Tax-Exempt Fund)) is
incorporated herein by reference to Exhibit 5(b) of Post-Effective
Amendment No. 25.
(3) Management Contract dated May 30, 1997, between Newbury Street
Trust, on behalf of Prime Fund, and Fidelity Management & Research
Company is incorporated herein by reference to Exhibit 5(c) of
Post-Effective Amendment No. 32.
(4) Management Contract dated May 30, 1997 between Newbury Street
Trust, on behalf of Tax-Exempt Fund, and Fidelity Management &
Research Company is incorporated herein by reference to Exhibit 5(d)
of Post-Effective Amendment No. 32.
(5) Sub-Advisory Agreement dated May 30, 1997, between FMR Texas Inc.
and Fidelity Management & Research Company, on behalf of Prime Fund is
incorporated herein by reference to Exhibit 5(e) of Post-Effective
Amendment No. 32.
(6) Sub-Advisory Agreement dated May 30, 1997, between FMR Texas Inc.
and Fidelity Management & Research Company, on behalf of Treasury Fund
is incorporated herein by reference to Exhibit 5(f) of Post-Effective
Amendment No. 32.
(e) (1) Form of General Distribution Agreement between Newbury Street
Trust, on behalf of Prime Fund, and Fidelity Distributors Corporation
is filed herein as Exhibit e(1).
(2) Form of General Distribution Agreement between Newbury Street
Trust, on behalf of Treasury Fund, and Fidelity Distributors
Corporation is filed herein as Exhibit e(2).
(3) Form of General Distribution Agreement between Newbury Street
Trust, on behalf of Tax-Exempt Fund, and Fidelity Distributors
Corporation is filed herein as Exhibit e(3).
(4) Form of Selling Dealer Agreement for Bank Related Transactions
(most recently revised January, 1997) is filed herein as Exhibit e(4).
(5) Form of Selling Dealer Agreement (most recently revised January,
1997) is filed herein as Exhibit e(5).
(6) Form of Bank Agency Agreement (most recently revised January,
1997) is filed herein as Exhibit e(6).
(7) Service Contract between Fidelity Distributors Corporation and
"Qualified Recipients" with respect to shares of Daily Tax-Exempt
Money Fund (currently known as Tax-Exempt Fund) is incorporated herein
by reference to Exhibit 6(b) of Post-Effective Amendment No. 25.
(8) Service Contract (Administrative and Recordkeeping Services Only)
between Fidelity Distributors Corporation and "Qualified Recipients"
with respect to shares of Daily Tax-Exempt Money Fund (currently known
as Tax-Exempt Fund) is incorporated herein by reference to Exhibit
6(c) of Post-Effective Amendment No. 25.
(9) Service Contract between Fidelity Distributors Corporation and
"Qualified Recipients" with respect to shares of U.S. Treasury
Portfolio (currently known as Treasury Fund) and Money Market
Portfolio (currently known as Prime Fund) is incorporated herein by
reference as Exhibit 6(g) of Daily Money Fund's Post-Effective
Amendment No. 34.
(10) Service Contract (Administrative and Recordkeeping Services
Only) between Fidelity Distributors Corporation and "Qualified
Recipients" with respect to shares of U.S. Treasury Portfolio
(currently known as Treasury Fund) and Money Market Portfolio
(currently known as Prime Fund) is incorporated herein by reference as
Exhibit 6(h) of Daily Money Fund's Post-Effective Amendment No. 34.
(11) Service Contract between Fidelity Distributors Corporation and
"Qualified Recipients" with respect to Capital Reserves Class shares
of Prime Fund, Tax-Exempt Fund and Treasury Fund is incorporated
herein by reference to Exhibit 6(m) of Post-Effective Amendment No.
32.
(12) Service Contract (Administrative and Recordkeeping Services
Only) between Fidelity Distributors Corporation and "Qualified
Recipients" with respect to Capital Reserves Class shares of Prime
Fund, Tax-Exempt Fund and Treasury Fund is incorporated herein by
reference to Exhibit 6(n) of Post-Effective Amendment No. 32.
(f) (1) Retirement Plan for Non-Interested Person Trustees, Directors
or General Partners, as amended on November 16, 1995, is incorporated
herein by reference to Exhibit 7(a) of Fidelity Select Portfolio's
(File No. 2-69972) Post-Effective Amendment No. 54.
(2) The Fee Deferral Plan for Non-Interested Person Directors and
Trustees of the Fidelity Funds, effective as of September 14, 1995 and
amended through November 14, 1996, is incorporated herein by reference
to Exhibit 7(b) of Fidelity Aberdeen Street Trust's (File No.
33-43529) Post-Effective Amendment No. 19.
(g) (1) Custodian Agreement and Appendix C, dated December 1, 1994,
between The Bank of New York and Newbury Street Trust on behalf of
Prime Fund and Treasury Fund is incorporated herein by reference to
Exhibit 8(a) of Fidelity Hereford Street Trust's Post-Effective
Amendment No. 4 (File No. 33-52577).
(2) Appendix A, dated June 18, 1998, to the Custodian Agreement,
dated December 1, 1994, between The Bank of New York and Newbury
Street Trust on behalf of Prime Fund and Treasury Fund is
incorporated herein by reference to Exhibit 8(b) of Fidelity Boston
Street Trust's Post-Effective Amendment No. 22 (File No. 33-17704).
(3) Appendix B, dated June 18, 1998, to the Custodian Agreement,
dated December 1, 1994, between The Bank of New York and Newbury
Street Trust on behalf of Prime Fund and Treasury Fund is incorporated
herein by reference to Exhibit 8(c) of Fidelity Boston Street Trust's
Post-Effective Amendment No. 22 (File No. 33-17704).
(4) Custodian Agreement, Appendix B, and Appendix C, dated December
1, 1994, between UMB Bank, n.a. and Newbury Street Trust on behalf of
Tax-Exempt Fund is incorporated herein by reference to Exhibit 8 of
Fidelity California Municipal Trust's Post-Effective Amendment No. 28
(File No. 2-83367).
(5) Appendix A, dated September 18, 1997, to the Custodian Agreement,
dated December 1, 1994, between UMB Bank, n.a. and Newbury Street
Trust on behalf of Tax-Exempt Fund is incorporated herein by reference
to Exhibit 8(b) of Fidelity Municipal Trust II's Post-Effective
Amendment No. 17 (File No. 33-43986).
(6) Fidelity Group Repo Custodian Agreement among The Bank of New
York, J. P. Morgan Securities, Inc., and the Fidelity Funds, is
incorporated herein by reference to Exhibit 8(d) of Fidelity
Institutional Cash Portfolio's Post-Effective Amendment No. 31.
(7) Schedule 1 to the Fidelity Group Repo Custodian Agreement among
The Bank of New York, J. P. Morgan Securities, Inc., and the Fidelity
Funds is incorporated herein by reference to Exhibit 8(e) of Daily
Money Fund's Post-Effective Amendment No 31.
(8) Fidelity Group Repo Custodian Agreement among Chemical Bank,
Greenwich Capital Markets, Inc., and the Fidelity Funds is
incorporated herein by reference to Exhibit 8(f) of Daily Money Fund's
Post-Effective Amendment No. 31.
(9) Joint Trading Account Custody Agreement between the The Bank of
New York and the Fidelity Funds is incorporated herein by reference to
Exhibit 8(h) of Daily Money Fund's Post-Effective Amendment No. 31.
(10) First Amendment to Joint Trading Account Custody Agreement
between the The Bank of New York and the Fidelity Funds is
incorporated herein by reference to Exhibit 8(i) of Daily Money Fund's
Post-Effective Amendment No. 31.
(h) Not applicable.
(i) Not applicable.
(j) Consent of PricewaterhouseCoopers LLP, dated December 23, 1998 is
filed herein as Exhibit j(1).
(k) Not applicable.
(l) Not applicable.
(m) (1) Distribution and Service Plan for Treasury Fund: Advisor C
Class is incorporated herein by reference to Exhibit 15(a) of
Post-Effective Amendment No. 33.
(2) Distribution and Service Plan for Treasury Fund: Daily Money
Class is incorporated herein by reference to Exhibit 15(a) of
Post-Effective Amendment No 29.
(3) Distribution and Service Plan for Treasury Fund: Capital Reserves
Class is incorporated herein by reference to Exhibit 15(c) of
Post-Effective Amendment No. 32.
(4) Distribution and Service Plan for Treasury Fund: Advisor B Class
is incorporated herein by reference to Exhibit 15(d) of Post-Effective
Amendment No. 29.
(5) Distribution and Service Plan for Prime Fund: Daily Money Class
is incorporated herein by reference to Exhibit 15(b) of
Post-Effective Amendment No. 29.
(6) Distribution and Service Plan for Prime Fund: Capital Reserves
Class is incorporated herein by reference to Exhibit 15(f) of
Post-Effective Amendment No. 32.
(7) Distribution and Service Plan for Tax-Exempt Fund: Daily Money
Class is incorporated herein by reference to Exhibit 15(c) of
Post-Effective Amendment No. 29.
(8) Distribution and Service Plan for Tax-Exempt: Capital Reserves
Class is incorporated herein by reference to Exhibit 15(h) of
Post-Effective Amendment No. 32.
(n) Financial Data Schedules for the funds are filed herein as
Exhibit 27.
(o) Rule 18f-3 Plan on behalf of Prime Fund, Treasury Fund and
Tax-Exempt Fund, dated September 18, 1997 is incorporated herein by
reference to Exhibit 18 of Post-Effective Amendment No. 33.
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 and 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
Pursuant to Del. Code Ann. title 12 (sub-section) 3817, a Delaware
business trust may provide in its governing instrument for the
indemnification of its officers and trustees from and against any and
all claims and demands whatsoever. Article X, Section 10.02 of the
Trust Instrument 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
Trust Instrument, 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 Investments Institutional
Operations Company, Inc. ("FIIOC") is appointed transfer agent, the
Registrant agrees to indemnify and hold FIIOC 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 Registrant, including by a shareholder, which names FIIOC
and/or the Registrant as a party and is not based on and does not
result from FIIOC's willful misfeasance, bad faith or negligence or
reckless disregard of duties, and arises out of or in connection with
FIIOC's performance under the Transfer Agency Agreement; or
(2) any claim, demand, action or suit (except to the extent
contributed to by FIIOC's willful misfeasance, bad faith or negligence
or reckless disregard of duties) which results from the negligence of
the Registrant, or from FIIOC's acting upon any instruction(s)
reasonably believed by it to have been executed or communicated by any
person duly authorized by the Registrant, or as a result of FIIOC's
acting in reliance upon advice reasonably believed by FIIOC to have
been given by counsel for the Registrant, or as a result of FIIOC'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.
Pursuant to the agreement by which Fidelity Investments Institutional
Operations Company, Inc. ("FIIOC") is appointed sub-transfer agent,
the Transfer Agent agrees to indemnify FIIOC for FIIOC's losses,
claims, damages, liabilities and expenses (including reasonable
counsel fees and expenses) (losses) to the extent that the Transfer
Agent is entitled to and receives indemnification from the Fund for
the same events. Under the Transfer Agency Agreement, the Trust agrees
to indemnify and hold the Transfer Agent 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 the Transfer
Agent and/or the Trust as a party and is not based on and does not
result from the Transfer Agent's willful misfeasance, bad faith or
negligence or reckless disregard of duties, and arises out of or in
connection with the Transfer Agent's performance under the Transfer
Agency Agreement; or
(2) any claim, demand, action or suit (except to the extent
contributed to by the Transfer Agent's willful misfeasance, bad faith
or negligence or reckless disregard of its duties) which results from
the negligence of the Trust, or from the Transfer Agent's acting upon
any instruction(s) reasonably believed by it to have been executed or
communicated by any person duly authorized by the Trust, or as a
result of the Transfer Agent's acting in reliance upon advice
reasonably believed by the Transfer Agent to have been given by
counsel for the Trust, or as a result of the Transfer Agent's acting
in reliance upon any instrument or stock certificate reasonably
believed by it to have been genuine and signed, countersigned or
executed by the proper person.
Item 26. Business and Other Connections of Investment Adviser
(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.
<TABLE>
<CAPTION>
<S> <C>
Edward C. Johnson 3d Chairman of the Board and Director of FMR; President
and Chief Executive Officer of FMR Corp.; Chairman
of the Board and Director of FMR Corp., Fidelity
Investments Money Management, Inc. (FIMM), Fidelity
Management & Research (U.K.) Inc. (FMR U.K.), and
Fidelity Management & Research (Far East) Inc. (FMR
Far East); Chairman of the Executive Committee of
FMR; 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, FMR U.K., and FMR Far East;
Previously, General Counsel, Managing Director, and
Senior Vice President of FMR Corp.
Peter S. Lynch Vice Chairman of the Board and Director of FMR.
John H. Carlson Vice President of FMR and of funds advised by FMR.
Dwight D. Churchill Senior Vice President of FMR and Vice President of
Bond Funds advised by FMR; Vice President of FIMM.
Brian Clancy Vice President of FMR and Treasurer of FMR, FIMM,
FMR U.K., and FMR Far East.
Barry Coffman Vice President of FMR.
Arieh Coll Vice President of FMR.
Frederic G. Corneel Tax Counsel of FMR.
Stephen G. Manning Assistant Treasurer of FMR, FIMM, FMR U.K., FMR
Far East; Vice President and Treasurer of FMR Corp.;
Treasurer of Strategic Advisers, Inc.
William Danoff Senior Vice President of FMR and Vice President of a
fund 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 Vice President of FMR and of funds advised by FMR.
Margaret L. Eagle Vice President of FMR and of funds advised by FMR.
William R. Ebsworth Vice President of FMR.
Richard B. Fentin Senior Vice President of FMR and Vice President of a
fund advised by FMR.
Gregory Fraser Vice President of FMR and of a fund advised by FMR.
Jay Freedman Assistant Clerk of FMR; Clerk of FMR Corp., FMR
U.K., FMR Far East, and Strategic Advisers, Inc.;
Secretary of FIMM; Associate General Counsel FMR
Corp.
David L. Glancy Vice President of FMR and of a fund advised by FMR.
Barry A. Greenfield Vice President of FMR and of a fund 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; Vice President of
High-Income Funds advised by FMR.
Robert Haber Vice President of FMR.
Richard C. Habermann Senior Vice President of FMR; Vice President of funds
advised by FMR.
Fred L. Henning Jr. Senior Vice President of FMR and Vice President of
Fixed-Income Funds advised by FMR.
Bruce T. Herring Vice President of FMR.
Robert F. Hill Vice President of FMR; Director of Technical Research.
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 Vice President of FMR and of a fund advised by FMR.
Francis V. Knox Vice President of FMR; Compliance Officer of FMR
U.K.
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.
Charles A. Mangum Vice President of FMR and of a fund advised by FMR.
Kevin McCarey Vice President of FMR and of a fund advised by FMR.
Neal P. Miller Vice President of FMR.
Jacques Perold Vice President of FMR.
Alan Radlo Vice President of FMR.
Eric D. Roiter Senior Vice President and General Counsel 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 a fund advised by FMR.
Fergus Shiel Vice President of 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 funds 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.
Thomas Sweeney Vice President of FMR.
Beth F. Terrana Senior Vice President of FMR and Vice President of a
fund 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 Vice President of
funds advised by FMR; Director of FMR Corp.
Steven S. Wymer Vice President of FMR and of a fund advised by FMR.
</TABLE>
(4) FIDELITY INVESTMENTS MONEY MANAGEMENT, INC. (FIMM)
Contra Way, Merrimack, NH 03054
FIMM 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 FIMM,
FMR, FMR Corp., FMR Far East, and FMR
U.K.; Chairman of the Executive Committee of
FMR; President and Chief Executive Officer of
FMR Corp.; 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, FMR U.K., and
FMR Far East; Previously, General Counsel,
Managing Director, and Senior Vice President of
FMR Corp.
Fred L. Henning Jr. Senior Vice President of FIMM; Senior Vice
President of FMR and Vice President of
Fixed-Income Funds advised by FMR.
Boyce I. Greer Vice President of FIMM; Senior Vice President
of FMR and Vice President of Money Market
Funds advised by FMR.
Dwight D. Churchill Vice President of FIMM; Senior Vice President
of FMR and Vice President of Bond Funds
advised by FMR.
Brian Clancy Treasurer of FIMM, FMR Far East, FMR U.K.,
and FMR and Vice President of FMR.
Jay Freedman Secretary of FIMM; Clerk of FMR U.K., FMR
Far East, FMR Corp. and Strategic Advisers,
Inc.; Assistant Clerk of FMR; Secretary of
FIMM; Associate General Counsel FMR Corp.
Stephen G. Manning Assistant Treasurer of FIMM, FMR U.K., FMR
Far East, and FMR; Vice President and Treasurer
of FMR Corp.; Treasurer of Strategic Advisers,
Inc.
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 C. Johnson 3d Director Trustee and President
Michael Mlinac Director None
James Curvey Director None
Martha B. Willis President None
Eric D. Roiter Senior Vice President Secretary
Caron Ketchum Treasurer and Controller None
Gary Greenstein Assistant Treasurer None
Jay Freedman Assistant Clerk None
Linda 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 funds'
respective custodian: The Bank of New York, 110 Washington Street, New
York, N.Y. or UMB Bank, n.a., 1010 Grand Avenue, Kansas City, MO.
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. 37 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 23rd day of December 1998.
NEWBURY STREET TRUST
By /s/Edward C. Johnson 3d (dagger)
Edward C. Johnson 3d, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons
in the capacities and on the dates indicated.
(Signature) (Title) (Date)
<TABLE>
<CAPTION>
<S> <C> <C>
/s/Edward C. Johnson 3d (dagger) President and Trustee December 23, 1998
Edward C. Johnson 3d (Principal Executive Officer)
/s/Richard A. Silver Treasurer December 23, 1998
Richard A. Silver
/s/Robert C. Pozen Trustee December 23, 1998
Robert C. Pozen
/s/Ralph F. Cox * Trustee December 23, 1998
Ralph F. Cox
/s/Phyllis Burke Davis * Trustee December 23, 1998
Phyllis Burke Davis
/s/Robert M. Gates ** Trustee December 23, 1998
Robert M. Gates
/s/E. Bradley Jones * Trustee December 23, 1998
E. Bradley Jones
/s/Donald J. Kirk * Trustee December 23, 1998
Donald J. Kirk
/s/Peter S. Lynch * Trustee December 23, 1998
Peter S. Lynch
/s/Marvin L. Mann * Trustee December 23, 1998
Marvin L. Mann
/s/William O. McCoy * Trustee December 23, 1998
William O. McCoy
/s/Gerald C. McDonough * Trustee December 23, 1998
Gerald C. McDonough
/s/Thomas R. Williams * Trustee December 23, 1998
Thomas R. Williams
</TABLE>
(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 19, 1996 and filed herewith.
** Signature affixed by Robert C. Hacker pursuant to a power of
attorney dated March 6, 1997 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:
<TABLE>
<CAPTION>
<S> <C>
Fidelity Aberdeen Street Trust Fidelity Hereford Street Trust
Fidelity Advisor Series I Fidelity Income Fund
Fidelity Advisor Series II Fidelity Institutional Cash Portfolios
Fidelity Advisor Series III Fidelity Institutional Tax-Exempt Cash Portfolios
Fidelity Advisor Series IV Fidelity Investment Trust
Fidelity Advisor Series V Fidelity Magellan Fund
Fidelity Advisor Series VI Fidelity Massachusetts Municipal Trust
Fidelity Advisor Series VII Fidelity Money Market Trust
Fidelity Advisor Series VIII Fidelity Mt. Vernon Street Trust
Fidelity Beacon Street Trust Fidelity Municipal Trust
Fidelity Boston Street Trust Fidelity Municipal Trust II
Fidelity California Municipal Trust Fidelity New York Municipal Trust
Fidelity California Municipal Trust II Fidelity New York Municipal Trust II
Fidelity Capital Trust Fidelity Phillips Street Trust
Fidelity Charles Street Trust Fidelity Puritan Trust
Fidelity Commonwealth Trust Fidelity Revere Street Trust
Fidelity Concord Street Trust Fidelity School Street Trust
Fidelity Congress Street Fund Fidelity Securities Fund
Fidelity Contrafund Fidelity Select Portfolios
Fidelity Corporate Trust Fidelity Sterling Performance Portfolio, L.P.
Fidelity Court Street Trust Fidelity Summer Street Trust
Fidelity Court Street Trust II Fidelity Trend Fund
Fidelity Covington Trust Fidelity U.S. Investments-Bond Fund, L.P.
Fidelity Daily Money Fund Fidelity U.S. Investments-Government Securities
Fidelity Destiny Portfolios Fund, L.P.
Fidelity Deutsche Mark Performance Fidelity Union Street Trust
Portfolio, L.P. Fidelity Union Street Trust II
Fidelity Devonshire Trust Fidelity Yen Performance Portfolio, L.P.
Fidelity Exchange Fund Newbury Street Trust
Fidelity Financial Trust Variable Insurance Products Fund
Fidelity Fixed-Income Trust Variable Insurance Products Fund II
Fidelity Government Securities Fund Variable Insurance Products Fund III
Fidelity Hastings Street Trust
</TABLE>
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:
<TABLE>
<CAPTION>
<S> <C>
Fidelity Aberdeen Street Trust Fidelity Government Securities Fund
Fidelity Advisor Annuity Fund Fidelity Hastings Street Trust
Fidelity Advisor Series I Fidelity Hereford Street Trust
Fidelity Advisor Series II Fidelity Income Fund
Fidelity Advisor Series III Fidelity Institutional Cash Portfolios
Fidelity Advisor Series IV Fidelity Institutional Tax-Exempt Cash Portfolios
Fidelity Advisor Series V Fidelity Institutional Trust
Fidelity Advisor Series VI Fidelity Investment Trust
Fidelity Advisor Series VII Fidelity Magellan Fund
Fidelity Advisor Series VIII Fidelity Massachusetts Municipal Trust
Fidelity Beacon Street Trust Fidelity Money Market Trust
Fidelity Boston Street Trust Fidelity Mt. Vernon Street Trust
Fidelity California Municipal Trust Fidelity Municipal Trust
Fidelity California Municipal Trust II Fidelity Municipal Trust II
Fidelity Capital Trust Fidelity New York Municipal Trust
Fidelity Charles Street Trust Fidelity New York Municipal Trust II
Fidelity Commonwealth Trust Fidelity Phillips Street Trust
Fidelity Congress Street Fund Fidelity Puritan Trust
Fidelity Contrafund Fidelity Revere Street Trust
Fidelity Corporate Trust Fidelity School Street Trust
Fidelity Court Street Trust Fidelity Securities Fund
Fidelity Court Street Trust II Fidelity Select Portfolios
Fidelity Covington Trust Fidelity Sterling Performance Portfolio, L.P.
Fidelity Daily Money Fund Fidelity Summer Street Trust
Fidelity Daily Tax-Exempt Fund Fidelity Trend Fund
Fidelity Destiny Portfolios Fidelity U.S. Investments-Bond Fund, L.P.
Fidelity Deutsche Mark Performance Fidelity U.S. Investments-Government Securities
Portfolio, L.P. Fund, L.P.
Fidelity Devonshire Trust Fidelity Union Street Trust
Fidelity Exchange Fund Fidelity Union Street Trust II
Fidelity Financial Trust Fidelity Yen Performance Portfolio, L.P.
Fidelity Fixed-Income Trust Variable Insurance Products Fund
Variable Insurance Products Fund II
</TABLE>
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, 1997.
WITNESS our hands on this nineteenth day of December, 1996.
/s/Edward C. Johnson 3d___________ /s/Peter S. Lynch________________
Edward C. Johnson 3d Peter S. Lynch
/s/J. Gary Burkhead_______________ /s/William O. McCoy______________
J. Gary Burkhead William O. McCoy
/s/Ralph F. Cox __________________ /s/Gerald C. McDonough___________
Ralph F. Cox Gerald C. McDonough
/s/Phyllis Burke Davis_____________ /s/Marvin L. Mann________________
Phyllis Burke Davis Marvin L. Mann
/s/E. Bradley Jones________________ /s/Thomas R. Williams ____________
E. Bradley Jones Thomas R. Williams
/s/Donald J. Kirk __________________
Donald J. Kirk
POWER OF ATTORNEY
I, the undersigned Director, Trustee, or General Partner, as the case
may be, of the following investment companies:
<TABLE>
<CAPTION>
<S> <C>
Fidelity Aberdeen Street Trust Fidelity Government Securities Fund
Fidelity Advisor Annuity Fund Fidelity Hastings Street Trust
Fidelity Advisor Series I Fidelity Hereford Street Trust
Fidelity Advisor Series II Fidelity Income Fund
Fidelity Advisor Series III Fidelity Institutional Cash Portfolios
Fidelity Advisor Series IV Fidelity Institutional Tax-Exempt Cash Portfolios
Fidelity Advisor Series V Fidelity Institutional Trust
Fidelity Advisor Series VI Fidelity Investment Trust
Fidelity Advisor Series VII Fidelity Magellan Fund
Fidelity Advisor Series VIII Fidelity Massachusetts Municipal Trust
Fidelity Beacon Street Trust Fidelity Money Market Trust
Fidelity Boston Street Trust Fidelity Mt. Vernon Street Trust
Fidelity California Municipal Trust Fidelity Municipal Trust
Fidelity California Municipal Trust II Fidelity Municipal Trust II
Fidelity Capital Trust Fidelity New York Municipal Trust
Fidelity Charles Street Trust Fidelity New York Municipal Trust II
Fidelity Commonwealth Trust Fidelity Phillips Street Trust
Fidelity Congress Street Fund Fidelity Puritan Trust
Fidelity Contrafund Fidelity Revere Street Trust
Fidelity Corporate Trust Fidelity School Street Trust
Fidelity Court Street Trust Fidelity Securities Fund
Fidelity Court Street Trust II Fidelity Select Portfolios
Fidelity Covington Trust Fidelity Sterling Performance Portfolio, L.P.
Fidelity Daily Money Fund Fidelity Summer Street Trust
Fidelity Daily Tax-Exempt Fund Fidelity Trend Fund
Fidelity Destiny Portfolios Fidelity U.S. Investments-Bond Fund, L.P.
Fidelity Deutsche Mark Performance Fidelity U.S. Investments-Government Securities
Portfolio, L.P. Fund, L.P.
Fidelity Devonshire Trust Fidelity Union Street Trust
Fidelity Exchange Fund Fidelity Union Street Trust II
Fidelity Financial Trust Fidelity Yen Performance Portfolio, L.P.
Fidelity Fixed-Income Trust Variable Insurance Products Fund
Variable Insurance Products Fund II
</TABLE>
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 Director, Trustee, or
General Partner (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, 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 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 my name
and behalf in connection therewith as said attorneys-in-fact deem
necessary or appropriate, to comply with the provisions of the
Securities Act of 1933 and 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 March 1,
1997.
WITNESS my hand on the date set forth below.
/s/Robert M. Gates March 6, 1997
Robert M. Gates
Exhibit e(1)
FORM OF
GENERAL DISTRIBUTION AGREEMENT
between
NEWBURY STREET TRUST
and
FIDELITY DISTRIBUTORS CORPORATION
Agreement made this ___ day of , 19 , between Newbury Street
Trust, a Delaware business trust having its principal place of
business in Boston, Massachusetts and which may issue one or more
series of beneficial interest ("Issuer"), with respect to shares of
Prime Fund, a series of the Issuer, and Fidelity Distributors
Corporation, a Massachusetts corporation having its principal place of
business in Boston, Massachusetts ("Distributors").
In consideration of the mutual promises and undertakings herein
contained, the parties agree as follows:
1. Sale of Shares - The Issuer grants to Distributors the right to
sell shares on behalf of the Issuer during the term of this Agreement
and subject to the registration requirements of the Securities Act of
1933, as amended ("1933 Act"), and of the laws governing the sale of
securities in the various states ("Blue Sky Laws") under the following
terms and conditions: Distributors (i) shall have the right to sell,
as agent on behalf of the Issuer, shares authorized for issue and
registered under the 1933 Act, and (ii) may sell shares under offers
of exchange, if available, between and among the funds advised by
Fidelity Management & Research Company ("FMR") or any of its
affiliates.
2. Sale of Shares by the Issuer - The rights granted to Distributors
shall be nonexclusive in that the Issuer reserves the right to sell
its shares to investors on applications received and accepted by the
Issuer. Further, the Issuer reserves the right to issue shares in
connection with the merger or consolidation, or acquisition by the
Issuer through purchase or otherwise, with any other investment
company, trust, or personal holding company.
3. Shares Covered by this Agreement - This Agreement shall apply to
unissued shares of the Issuer, shares of the Issuer held in its
treasury in the event that in the discretion of the Issuer treasury
shares shall be sold, and shares of the Issuer repurchased for resale.
4. Public Offering Price - Except as otherwise noted in the Issuer's
current Prospectus and/or Statement of Additional Information, all
shares sold to investors by Distributors or the Issuer will be sold at
the public offering price. The public offering price for all accepted
subscriptions will be the net asset value per share, as determined in
the manner described in the Issuer's current Prospectus and/or
Statement of Additional Information, plus a sales charge (if any)
described in the Issuer's current Prospectus and/or Statement of
Additional Information. The Issuer shall in all cases receive the net
asset value per share on all sales. If a sales charge is in effect,
Distributors shall have the right subject to such rules or regulations
of the Securities and Exchange Commission as may then be in effect
pursuant to Section 22 of the Investment Company Act of 1940 to pay a
portion of the sales charge to dealers who have sold shares of the
Issuer. If a fee in connection with shareholder redemptions is in
effect, the Issuer shall collect the fee on behalf of Distributors
and, unless otherwise agreed upon by the Issuer and Distributors,
Distributors shall be entitled to receive all of such fees.
5. Suspension of Sales - If and whenever the determination of net
asset value is suspended and until such suspension is terminated, no
further orders for shares shall be processed by Distributors except
such unconditional orders as may have been placed with Distributors
before it had knowledge of the suspension. In addition, the Issuer
reserves the right to suspend sales and Distributors' authority to
process orders for shares on behalf of the Issuer if, in the judgment
of the Issuer, it is in the best interests of the Issuer to do so.
Suspension will continue for such period as may be determined by the
Issuer.
6. Solicitation of Sales - In consideration of these rights granted to
Distributors, Distributors agrees to use all reasonable efforts,
consistent with its other business, to secure purchasers for shares of
the Issuer. This shall not prevent Distributors from entering into
like arrangements (including arrangements involving the payment of
underwriting commissions) with other issuers. This does not obligate
Distributors to register as a broker or dealer under the Blue Sky Laws
of any jurisdiction in which it is not now registered or to maintain
its registration in any jurisdiction in which it is now registered.
If a sales charge is in effect, Distributors shall have the right to
enter into sales agreements with dealers of its choice for the sale of
shares of the Issuer to the public at the public offering price only
and fix in such agreements the portion of the sales charge which may
be retained by dealers, provided that the Issuer shall approve the
form of the dealer agreement and the dealer discounts set forth
therein and shall evidence such approval by filing said form of dealer
agreement and amendments thereto as an exhibit to its currently
effective Registration Statement under the 1933 Act.
7. Authorized Representations - Distributors is not authorized by the
Issuer to give any information or to make any representations other
than those contained in the appropriate registration statements or
Prospectuses and Statements of Additional Information filed with the
Securities and Exchange Commission under the 1933 Act (as these
registration statements, Prospectuses and Statements of Additional
Information may be amended from time to time), or contained in
shareholder reports or other material that may be prepared by or on
behalf of the Issuer for Distributors' use. This shall not be
construed to prevent Distributors from preparing and distributing
sales literature or other material as it may deem appropriate.
8. Portfolio Securities - Portfolio securities of the Issuer may be
bought or sold by or through Distributors, and Distributors may
participate directly or indirectly in brokerage commissions or
"spreads" for transactions in portfolio securities of the Issuer.
9. Registration of Shares - The Issuer agrees that it will take all
action necessary to register shares under the 1933 Act (subject to the
necessary approval of its shareholders) so that there will be
available for sale the number of shares Distributors may reasonably be
expected to sell. The Issuer shall make available to Distributors
such number of copies of its currently effective Prospectus and
Statement of Additional Information as Distributors may reasonably
request. The Issuer shall furnish to Distributors copies of all
information, financial statements and other papers which Distributors
may reasonably request for use in connection with the distribution of
shares of the Issuer.
10. Expenses - The Issuer shall pay all fees and expenses (a) in
connection with the preparation, setting in type and filing of any
registration statement, Prospectus and Statement of Additional
Information under the 1933 Act and amendments for the issue of its
shares, (b) in connection with the registration and qualification of
shares for sale in the various states in which the Board of Trustees
of the Issuer shall determine it advisable to qualify such shares for
sale (including registering the Issuer as a broker or dealer or any
officer of the Issuer as agent or salesman in any state), (c) of
preparing, setting in type, printing and mailing any report or other
communication to shareholders of the Issuer in their capacity as such,
and (d) of preparing, setting in type, printing and mailing
Prospectuses, Statements of Additional Information and any supplements
thereto sent to existing shareholders.
As provided in the Distribution and Service Plan adopted by the
Issuer, it is recognized by the Issuer that FMR may make payment to
Distributors with respect to any expenses incurred in the distribution
of shares of the Issuer, such payments payable from the past profits
or other resources of FMR including management fees paid to it by the
Issuer.
11. Indemnification - The Issuer agrees to indemnify and hold harmless
Distributors and each of its directors and officers and each person,
if any, who controls Distributors 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 Issuer (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 Issuer does not agree to indemnify Distributors 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
Issuer by or on behalf of Distributors. In no case (i) is the
indemnity of the Issuer in favor of Distributors or any person
indemnified to be deemed to protect Distributors or any person against
any liability to the Issuer or its security holders to which
Distributors or such person would otherwise be subject by reason of
wilful 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, or (ii) is the Issuer to
be liable under its indemnity agreement contained in this paragraph
with respect to any claim made against Distributors or any person
indemnified unless Distributors or person, as the case may be, shall
have notified the Issuer in writing of the claim within a reasonable
time after the summons or other first written notification giving
information of the nature of the claim shall have been served upon
Distributors or any such person (or after Distributors or such person
shall have received notice of service on any designated agent).
However, failure to notify the Issuer of any claim shall not relieve
the Issuer from any liability which it may have to Distributors or any
person against whom such action is brought otherwise than on account
of its indemnity agreement contained in this paragraph. The Issuer
shall be entitled to participate at its own expense in the defense,
or, if it so elects, to assume the defense of any suit brought to
enforce any claims, but if the Issuer elects to assume the defense,
the defense shall be conducted by counsel chosen by it and
satisfactory to Distributors or person or persons, defendant or
defendants in the suit. In the event the Issuer elects to assume the
defense of any suit and retain counsel, Distributors, officers or
directors or controlling person or persons, defendant or defendants in
the suit, shall bear the fees and expenses of any additional counsel
retained by them. If the Issuer does not elect to assume the defense
of any suit, it will reimburse Distributors, officers or directors or
controlling person or persons, defendant or defendants in the suit,
for the reasonable fees and expenses of any counsel retained by them.
The Issuer agrees to notify Distributors promptly of the commencement
of any litigation or proceedings against it or any of its officers or
trustees in connection with the issuance or sale of any of the shares.
Distributors also covenants and agrees that it will indemnify and
hold harmless the Issuer and each of its Board members and officers
and each person, if any, who controls the Issuer within the meaning of
Section 15 of the 1933 Act, against any loss, liability, damages,
claim or expense (including the reasonable cost of investigating or
defending any alleged loss, liability, damages, claim or expense and
reasonable counsel fees incurred in connection therewith) arising by
reason of any person acquiring any shares, based upon the 1933 Act or
any other statute or common law, alleging any wrongful act of
Distributors or any of its employees or alleging that the registration
statement, Prospectus, Statement of Additional Information,
shareholder reports or other information filed or made public by the
Issuer (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,
insofar as the statement or omission was made in reliance upon, and in
conformity with information furnished to the Issuer by or on behalf of
Distributors. In no case (i) is the indemnity of Distributors in
favor of the Issuer or any person indemnified to be deemed to protect
the Issuer or any person against any liability to which the Issuer 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, or (ii) is Distributors to be liable
under its indemnity agreement contained in this paragraph with respect
to any claim made against the Issuer or any person indemnified unless
the Issuer or person, as the case may be, shall have notified
Distributors in writing of the claim within a reasonable time after
the summons or other first written notification giving information of
the nature of the claim shall have been served upon the Issuer or any
such person (or after the Issuer or such person shall have received
notice of service on any designated agent). However, failure to
notify Distributors of any claim shall not relieve Distributors from
any liability which it may have to the Issuer or any person against
whom the action is brought otherwise than on account of its indemnity
agreement contained in this paragraph. In the case of any notice to
Distributors, it shall be entitled to participate, at its own expense,
in the defense or, if it so elects, to assume the defense of any suit
brought to enforce the claim, but if Distributors elects to assume the
defense, the defense shall be conducted by counsel chosen by it and
satisfactory to the Issuer, to its officers and Board and to any
controlling person or persons, defendant or defendants in the suit.
In the event that Distributors elects to assume the defense of any
suit and retain counsel, the Issuer or controlling persons, defendant
or defendants in the suit, shall bear the fees and expense of any
additional counsel retained by them. If Distributors does not elect
to assume the defense of any suit, it will reimburse the Issuer,
officers and Board or controlling person or persons, defendant or
defendants in the suit, for the reasonable fees and expenses of any
counsel retained by them. Distributors agrees to notify the Issuer
promptly of the commencement of any litigation or proceedings against
it in connection with the issue and sale of any of the shares.
12. Effective Date - This agreement shall be effective upon its
execution, and unless terminated as provided, shall continue in force
until March 31, 199 and thereafter from year to year, provided
continuance is approved annually by the vote of a majority of the
Board members of the Issuer, and by the vote of those Board members of
the Issuer who are not "interested persons" of the Issuer and, if a
plan under Rule 12b-1 under the Investment Company Act of 1940 is in
effect, by the vote of those Board members of the Issuer who are not
"interested persons" of the Issuer and who are not parties to the
Distribution and Service Plan or this Agreement and have no financial
interest in the operation of the Distribution and Service Plan or in
any agreements related to the Distribution and Service Plan, cast in
person at a meeting called for the purpose of voting on the approval.
This Agreement shall automatically terminate in the event of its
assignment. As used in this paragraph, the terms "assignment" and
"interested persons" shall have the respective meanings specified in
the Investment Company Act of 1940 as now in effect or as hereafter
amended. In addition to termination by failure to approve continuance
or by assignment, this Agreement may at any time be terminated by
either party upon not less than sixty days' prior written notice to
the other party.
13. Notice - Any notice required or permitted to be given by either
party to the other shall be deemed sufficient if sent by registered or
certified mail, postage prepaid, addressed by the party giving notice
to the other party at the last address furnished by the other party to
the party giving notice: if to the Issuer, at 82 Devonshire Street,
Boston, Massachusetts, and if to Distributors, at 82 Devonshire
Street, Boston, Massachusetts.
14. Limitation of Liability - Distributors is expressly put on notice
of the limitation of shareholder liability as set forth in the
Declaration of Trust or other organizational document of the Issuer
and agrees that the obligations assumed by the Issuer under this
contract shall be limited in all cases to the Issuer and its assets.
Distributors shall not seek satisfaction of any such obligation from
the shareholders or any shareholder of the Issuer. Nor shall
Distributors seek satisfaction of any such obligation from the
Trustees or any individual Trustee of the Issuer. Distributors
understands that the rights and obligations of each series of shares
of the Issuer under the Issuer's Declaration of Trust or other
organizational document are separate and distinct from those of any
and all other series.
15. 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.
IN WITNESS WHEREOF, the Issuer has executed this instrument in its
name and behalf, and its seal affixed, by one of its officers duly
authorized, and Distributors has executed this instrument in its name
and behalf by one of its officers duly authorized, as of the day and
year first above written.
[SIGNATURE LINES OMITTED]
Exhibit e(2)
FORM OF
GENERAL DISTRIBUTION AGREEMENT
between
NEWBURY STREET TRUST
and
FIDELITY DISTRIBUTORS CORPORATION
Agreement made this ___ day of , 19 , between Newbury Street
Trust, a Delaware business trust having its principal place of
business in Boston, Massachusetts and which may issue one or more
series of beneficial interest ("Issuer"), with respect to shares of
Treasury Fund, a series of the Issuer, and Fidelity Distributors
Corporation, a Massachusetts corporation having its principal place of
business in Boston, Massachusetts ("Distributors").
In consideration of the mutual promises and undertakings herein
contained, the parties agree as follows:
1. Sale of Shares - The Issuer grants to Distributors the right to
sell shares on behalf of the Issuer during the term of this Agreement
and subject to the registration requirements of the Securities Act of
1933, as amended ("1933 Act"), and of the laws governing the sale of
securities in the various states ("Blue Sky Laws") under the following
terms and conditions: Distributors (i) shall have the right to sell,
as agent on behalf of the Issuer, shares authorized for issue and
registered under the 1933 Act, and (ii) may sell shares under offers
of exchange, if available, between and among the funds advised by
Fidelity Management & Research Company ("FMR") or any of its
affiliates.
2. Sale of Shares by the Issuer - The rights granted to Distributors
shall be nonexclusive in that the Issuer reserves the right to sell
its shares to investors on applications received and accepted by the
Issuer. Further, the Issuer reserves the right to issue shares in
connection with the merger or consolidation, or acquisition by the
Issuer through purchase or otherwise, with any other investment
company, trust, or personal holding company.
3. Shares Covered by this Agreement - This Agreement shall apply to
unissued shares of the Issuer, shares of the Issuer held in its
treasury in the event that in the discretion of the Issuer treasury
shares shall be sold, and shares of the Issuer repurchased for resale.
4. Public Offering Price - Except as otherwise noted in the Issuer's
current Prospectus and/or Statement of Additional Information, all
shares sold to investors by Distributors or the Issuer will be sold at
the public offering price. The public offering price for all accepted
subscriptions will be the net asset value per share, as determined in
the manner described in the Issuer's current Prospectus and/or
Statement of Additional Information, plus a sales charge (if any)
described in the Issuer's current Prospectus and/or Statement of
Additional Information. The Issuer shall in all cases receive the net
asset value per share on all sales. If a sales charge is in effect,
Distributors shall have the right subject to such rules or regulations
of the Securities and Exchange Commission as may then be in effect
pursuant to Section 22 of the Investment Company Act of 1940 to pay a
portion of the sales charge to dealers who have sold shares of the
Issuer. If a fee in connection with shareholder redemptions is in
effect, the Issuer shall collect the fee on behalf of Distributors
and, unless otherwise agreed upon by the Issuer and Distributors,
Distributors shall be entitled to receive all of such fees.
5. Suspension of Sales - If and whenever the determination of net
asset value is suspended and until such suspension is terminated, no
further orders for shares shall be processed by Distributors except
such unconditional orders as may have been placed with Distributors
before it had knowledge of the suspension. In addition, the Issuer
reserves the right to suspend sales and Distributors' authority to
process orders for shares on behalf of the Issuer if, in the judgment
of the Issuer, it is in the best interests of the Issuer to do so.
Suspension will continue for such period as may be determined by the
Issuer.
6. Solicitation of Sales - In consideration of these rights granted to
Distributors, Distributors agrees to use all reasonable efforts,
consistent with its other business, to secure purchasers for shares of
the Issuer. This shall not prevent Distributors from entering into
like arrangements (including arrangements involving the payment of
underwriting commissions) with other issuers. This does not obligate
Distributors to register as a broker or dealer under the Blue Sky Laws
of any jurisdiction in which it is not now registered or to maintain
its registration in any jurisdiction in which it is now registered.
If a sales charge is in effect, Distributors shall have the right to
enter into sales agreements with dealers of its choice for the sale of
shares of the Issuer to the public at the public offering price only
and fix in such agreements the portion of the sales charge which may
be retained by dealers, provided that the Issuer shall approve the
form of the dealer agreement and the dealer discounts set forth
therein and shall evidence such approval by filing said form of dealer
agreement and amendments thereto as an exhibit to its currently
effective Registration Statement under the 1933 Act.
7. Authorized Representations - Distributors is not authorized by the
Issuer to give any information or to make any representations other
than those contained in the appropriate registration statements or
Prospectuses and Statements of Additional Information filed with the
Securities and Exchange Commission under the 1933 Act (as these
registration statements, Prospectuses and Statements of Additional
Information may be amended from time to time), or contained in
shareholder reports or other material that may be prepared by or on
behalf of the Issuer for Distributors' use. This shall not be
construed to prevent Distributors from preparing and distributing
sales literature or other material as it may deem appropriate.
8. Portfolio Securities - Portfolio securities of the Issuer may be
bought or sold by or through Distributors, and Distributors may
participate directly or indirectly in brokerage commissions or
"spreads" for transactions in portfolio securities of the Issuer.
9. Registration of Shares - The Issuer agrees that it will take all
action necessary to register shares under the 1933 Act (subject to the
necessary approval of its shareholders) so that there will be
available for sale the number of shares Distributors may reasonably be
expected to sell. The Issuer shall make available to Distributors
such number of copies of its currently effective Prospectus and
Statement of Additional Information as Distributors may reasonably
request. The Issuer shall furnish to Distributors copies of all
information, financial statements and other papers which Distributors
may reasonably request for use in connection with the distribution of
shares of the Issuer.
10. Expenses - The Issuer shall pay all fees and expenses (a) in
connection with the preparation, setting in type and filing of any
registration statement, Prospectus and Statement of Additional
Information under the 1933 Act and amendments for the issue of its
shares, (b) in connection with the registration and qualification of
shares for sale in the various states in which the Board of Trustees
of the Issuer shall determine it advisable to qualify such shares for
sale (including registering the Issuer as a broker or dealer or any
officer of the Issuer as agent or salesman in any state), (c) of
preparing, setting in type, printing and mailing any report or other
communication to shareholders of the Issuer in their capacity as such,
and (d) of preparing, setting in type, printing and mailing
Prospectuses, Statements of Additional Information and any supplements
thereto sent to existing shareholders.
As provided in the Distribution and Service Plan adopted by the
Issuer, it is recognized by the Issuer that FMR may make payment to
Distributors with respect to any expenses incurred in the distribution
of shares of the Issuer, such payments payable from the past profits
or other resources of FMR including management fees paid to it by the
Issuer.
11. Indemnification - The Issuer agrees to indemnify and hold harmless
Distributors and each of its directors and officers and each person,
if any, who controls Distributors 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 Issuer (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 Issuer does not agree to indemnify Distributors 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
Issuer by or on behalf of Distributors. In no case (i) is the
indemnity of the Issuer in favor of Distributors or any person
indemnified to be deemed to protect Distributors or any person against
any liability to the Issuer or its security holders to which
Distributors or such person would otherwise be subject by reason of
wilful 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, or (ii) is the Issuer to
be liable under its indemnity agreement contained in this paragraph
with respect to any claim made against Distributors or any person
indemnified unless Distributors or person, as the case may be, shall
have notified the Issuer in writing of the claim within a reasonable
time after the summons or other first written notification giving
information of the nature of the claim shall have been served upon
Distributors or any such person (or after Distributors or such person
shall have received notice of service on any designated agent).
However, failure to notify the Issuer of any claim shall not relieve
the Issuer from any liability which it may have to Distributors or any
person against whom such action is brought otherwise than on account
of its indemnity agreement contained in this paragraph. The Issuer
shall be entitled to participate at its own expense in the defense,
or, if it so elects, to assume the defense of any suit brought to
enforce any claims, but if the Issuer elects to assume the defense,
the defense shall be conducted by counsel chosen by it and
satisfactory to Distributors or person or persons, defendant or
defendants in the suit. In the event the Issuer elects to assume the
defense of any suit and retain counsel, Distributors, officers or
directors or controlling person or persons, defendant or defendants in
the suit, shall bear the fees and expenses of any additional counsel
retained by them. If the Issuer does not elect to assume the defense
of any suit, it will reimburse Distributors, officers or directors or
controlling person or persons, defendant or defendants in the suit,
for the reasonable fees and expenses of any counsel retained by them.
The Issuer agrees to notify Distributors promptly of the commencement
of any litigation or proceedings against it or any of its officers or
trustees in connection with the issuance or sale of any of the shares.
Distributors also covenants and agrees that it will indemnify and
hold harmless the Issuer and each of its Board members and officers
and each person, if any, who controls the Issuer within the meaning of
Section 15 of the 1933 Act, against any loss, liability, damages,
claim or expense (including the reasonable cost of investigating or
defending any alleged loss, liability, damages, claim or expense and
reasonable counsel fees incurred in connection therewith) arising by
reason of any person acquiring any shares, based upon the 1933 Act or
any other statute or common law, alleging any wrongful act of
Distributors or any of its employees or alleging that the registration
statement, Prospectus, Statement of Additional Information,
shareholder reports or other information filed or made public by the
Issuer (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,
insofar as the statement or omission was made in reliance upon, and in
conformity with information furnished to the Issuer by or on behalf of
Distributors. In no case (i) is the indemnity of Distributors in
favor of the Issuer or any person indemnified to be deemed to protect
the Issuer or any person against any liability to which the Issuer 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, or (ii) is Distributors to be liable
under its indemnity agreement contained in this paragraph with respect
to any claim made against the Issuer or any person indemnified unless
the Issuer or person, as the case may be, shall have notified
Distributors in writing of the claim within a reasonable time after
the summons or other first written notification giving information of
the nature of the claim shall have been served upon the Issuer or any
such person (or after the Issuer or such person shall have received
notice of service on any designated agent). However, failure to
notify Distributors of any claim shall not relieve Distributors from
any liability which it may have to the Issuer or any person against
whom the action is brought otherwise than on account of its indemnity
agreement contained in this paragraph. In the case of any notice to
Distributors, it shall be entitled to participate, at its own expense,
in the defense or, if it so elects, to assume the defense of any suit
brought to enforce the claim, but if Distributors elects to assume the
defense, the defense shall be conducted by counsel chosen by it and
satisfactory to the Issuer, to its officers and Board and to any
controlling person or persons, defendant or defendants in the suit.
In the event that Distributors elects to assume the defense of any
suit and retain counsel, the Issuer or controlling persons, defendant
or defendants in the suit, shall bear the fees and expense of any
additional counsel retained by them. If Distributors does not elect
to assume the defense of any suit, it will reimburse the Issuer,
officers and Board or controlling person or persons, defendant or
defendants in the suit, for the reasonable fees and expenses of any
counsel retained by them. Distributors agrees to notify the Issuer
promptly of the commencement of any litigation or proceedings against
it in connection with the issue and sale of any of the shares.
12. Effective Date - This agreement shall be effective upon its
execution, and unless terminated as provided, shall continue in force
until March 31, 199 and thereafter from year to year, provided
continuance is approved annually by the vote of a majority of the
Board members of the Issuer, and by the vote of those Board members of
the Issuer who are not "interested persons" of the Issuer and, if a
plan under Rule 12b-1 under the Investment Company Act of 1940 is in
effect, by the vote of those Board members of the Issuer who are not
"interested persons" of the Issuer and who are not parties to the
Distribution and Service Plan or this Agreement and have no financial
interest in the operation of the Distribution and Service Plan or in
any agreements related to the Distribution and Service Plan, cast in
person at a meeting called for the purpose of voting on the approval.
This Agreement shall automatically terminate in the event of its
assignment. As used in this paragraph, the terms "assignment" and
"interested persons" shall have the respective meanings specified in
the Investment Company Act of 1940 as now in effect or as hereafter
amended. In addition to termination by failure to approve continuance
or by assignment, this Agreement may at any time be terminated by
either party upon not less than sixty days' prior written notice to
the other party.
13. Notice - Any notice required or permitted to be given by either
party to the other shall be deemed sufficient if sent by registered or
certified mail, postage prepaid, addressed by the party giving notice
to the other party at the last address furnished by the other party to
the party giving notice: if to the Issuer, at 82 Devonshire Street,
Boston, Massachusetts, and if to Distributors, at 82 Devonshire
Street, Boston, Massachusetts.
14. Limitation of Liability - Distributors is expressly put on notice
of the limitation of shareholder liability as set forth in the
Declaration of Trust or other organizational document of the Issuer
and agrees that the obligations assumed by the Issuer under this
contract shall be limited in all cases to the Issuer and its assets.
Distributors shall not seek satisfaction of any such obligation from
the shareholders or any shareholder of the Issuer. Nor shall
Distributors seek satisfaction of any such obligation from the
Trustees or any individual Trustee of the Issuer. Distributors
understands that the rights and obligations of each series of shares
of the Issuer under the Issuer's Declaration of Trust or other
organizational document are separate and distinct from those of any
and all other series.
15. 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.
IN WITNESS WHEREOF, the Issuer has executed this instrument in its
name and behalf, and its seal affixed, by one of its officers duly
authorized, and Distributors has executed this instrument in its name
and behalf by one of its officers duly authorized, as of the day and
year first above written.
[SIGNATURE LINES OMITTED]
Exhibit e(3)
FORM OF
GENERAL DISTRIBUTION AGREEMENT
between
NEWBURY STREET TRUST
and
FIDELITY DISTRIBUTORS CORPORATION
Agreement made this ___ day of , 19 , between Newbury Street
Trust, a Delaware business trust having its principal place of
business in Boston, Massachusetts and which may issue one or more
series of beneficial interest ("Issuer"), with respect to shares of
Tax-Exempt Fund, a series of the Issuer, and Fidelity Distributors
Corporation, a Massachusetts corporation having its principal place of
business in Boston, Massachusetts ("Distributors").
In consideration of the mutual promises and undertakings herein
contained, the parties agree as follows:
1. Sale of Shares - The Issuer grants to Distributors the right to
sell shares on behalf of the Issuer during the term of this Agreement
and subject to the registration requirements of the Securities Act of
1933, as amended ("1933 Act"), and of the laws governing the sale of
securities in the various states ("Blue Sky Laws") under the following
terms and conditions: Distributors (i) shall have the right to sell,
as agent on behalf of the Issuer, shares authorized for issue and
registered under the 1933 Act, and (ii) may sell shares under offers
of exchange, if available, between and among the funds advised by
Fidelity Management & Research Company ("FMR") or any of its
affiliates.
2. Sale of Shares by the Issuer - The rights granted to Distributors
shall be nonexclusive in that the Issuer reserves the right to sell
its shares to investors on applications received and accepted by the
Issuer. Further, the Issuer reserves the right to issue shares in
connection with the merger or consolidation, or acquisition by the
Issuer through purchase or otherwise, with any other investment
company, trust, or personal holding company.
3. Shares Covered by this Agreement - This Agreement shall apply to
unissued shares of the Issuer, shares of the Issuer held in its
treasury in the event that in the discretion of the Issuer treasury
shares shall be sold, and shares of the Issuer repurchased for resale.
4. Public Offering Price - Except as otherwise noted in the Issuer's
current Prospectus and/or Statement of Additional Information, all
shares sold to investors by Distributors or the Issuer will be sold at
the public offering price. The public offering price for all accepted
subscriptions will be the net asset value per share, as determined in
the manner described in the Issuer's current Prospectus and/or
Statement of Additional Information, plus a sales charge (if any)
described in the Issuer's current Prospectus and/or Statement of
Additional Information. The Issuer shall in all cases receive the net
asset value per share on all sales. If a sales charge is in effect,
Distributors shall have the right subject to such rules or regulations
of the Securities and Exchange Commission as may then be in effect
pursuant to Section 22 of the Investment Company Act of 1940 to pay a
portion of the sales charge to dealers who have sold shares of the
Issuer. If a fee in connection with shareholder redemptions is in
effect, the Issuer shall collect the fee on behalf of Distributors
and, unless otherwise agreed upon by the Issuer and Distributors,
Distributors shall be entitled to receive all of such fees.
5. Suspension of Sales - If and whenever the determination of net
asset value is suspended and until such suspension is terminated, no
further orders for shares shall be processed by Distributors except
such unconditional orders as may have been placed with Distributors
before it had knowledge of the suspension. In addition, the Issuer
reserves the right to suspend sales and Distributors' authority to
process orders for shares on behalf of the Issuer if, in the judgment
of the Issuer, it is in the best interests of the Issuer to do so.
Suspension will continue for such period as may be determined by the
Issuer.
6. Solicitation of Sales - In consideration of these rights granted to
Distributors, Distributors agrees to use all reasonable efforts,
consistent with its other business, to secure purchasers for shares of
the Issuer. This shall not prevent Distributors from entering into
like arrangements (including arrangements involving the payment of
underwriting commissions) with other issuers. This does not obligate
Distributors to register as a broker or dealer under the Blue Sky Laws
of any jurisdiction in which it is not now registered or to maintain
its registration in any jurisdiction in which it is now registered.
If a sales charge is in effect, Distributors shall have the right to
enter into sales agreements with dealers of its choice for the sale of
shares of the Issuer to the public at the public offering price only
and fix in such agreements the portion of the sales charge which may
be retained by dealers, provided that the Issuer shall approve the
form of the dealer agreement and the dealer discounts set forth
therein and shall evidence such approval by filing said form of dealer
agreement and amendments thereto as an exhibit to its currently
effective Registration Statement under the 1933 Act.
7. Authorized Representations - Distributors is not authorized by the
Issuer to give any information or to make any representations other
than those contained in the appropriate registration statements or
Prospectuses and Statements of Additional Information filed with the
Securities and Exchange Commission under the 1933 Act (as these
registration statements, Prospectuses and Statements of Additional
Information may be amended from time to time), or contained in
shareholder reports or other material that may be prepared by or on
behalf of the Issuer for Distributors' use. This shall not be
construed to prevent Distributors from preparing and distributing
sales literature or other material as it may deem appropriate.
8. Portfolio Securities - Portfolio securities of the Issuer may be
bought or sold by or through Distributors, and Distributors may
participate directly or indirectly in brokerage commissions or
"spreads" for transactions in portfolio securities of the Issuer.
9. Registration of Shares - The Issuer agrees that it will take all
action necessary to register shares under the 1933 Act (subject to the
necessary approval of its shareholders) so that there will be
available for sale the number of shares Distributors may reasonably be
expected to sell. The Issuer shall make available to Distributors
such number of copies of its currently effective Prospectus and
Statement of Additional Information as Distributors may reasonably
request. The Issuer shall furnish to Distributors copies of all
information, financial statements and other papers which Distributors
may reasonably request for use in connection with the distribution of
shares of the Issuer.
10. Expenses - The Issuer shall pay all fees and expenses (a) in
connection with the preparation, setting in type and filing of any
registration statement, Prospectus and Statement of Additional
Information under the 1933 Act and amendments for the issue of its
shares, (b) in connection with the registration and qualification of
shares for sale in the various states in which the Board of Trustees
of the Issuer shall determine it advisable to qualify such shares for
sale (including registering the Issuer as a broker or dealer or any
officer of the Issuer as agent or salesman in any state), (c) of
preparing, setting in type, printing and mailing any report or other
communication to shareholders of the Issuer in their capacity as such,
and (d) of preparing, setting in type, printing and mailing
Prospectuses, Statements of Additional Information and any supplements
thereto sent to existing shareholders.
As provided in the Distribution and Service Plan adopted by the
Issuer, it is recognized by the Issuer that FMR may make payment to
Distributors with respect to any expenses incurred in the distribution
of shares of the Issuer, such payments payable from the past profits
or other resources of FMR including management fees paid to it by the
Issuer.
11. Indemnification - The Issuer agrees to indemnify and hold harmless
Distributors and each of its directors and officers and each person,
if any, who controls Distributors 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 Issuer (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 Issuer does not agree to indemnify Distributors 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
Issuer by or on behalf of Distributors. In no case (i) is the
indemnity of the Issuer in favor of Distributors or any person
indemnified to be deemed to protect Distributors or any person against
any liability to the Issuer or its security holders to which
Distributors or such person would otherwise be subject by reason of
wilful 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, or (ii) is the Issuer to
be liable under its indemnity agreement contained in this paragraph
with respect to any claim made against Distributors or any person
indemnified unless Distributors or person, as the case may be, shall
have notified the Issuer in writing of the claim within a reasonable
time after the summons or other first written notification giving
information of the nature of the claim shall have been served upon
Distributors or any such person (or after Distributors or such person
shall have received notice of service on any designated agent).
However, failure to notify the Issuer of any claim shall not relieve
the Issuer from any liability which it may have to Distributors or any
person against whom such action is brought otherwise than on account
of its indemnity agreement contained in this paragraph. The Issuer
shall be entitled to participate at its own expense in the defense,
or, if it so elects, to assume the defense of any suit brought to
enforce any claims, but if the Issuer elects to assume the defense,
the defense shall be conducted by counsel chosen by it and
satisfactory to Distributors or person or persons, defendant or
defendants in the suit. In the event the Issuer elects to assume the
defense of any suit and retain counsel, Distributors, officers or
directors or controlling person or persons, defendant or defendants in
the suit, shall bear the fees and expenses of any additional counsel
retained by them. If the Issuer does not elect to assume the defense
of any suit, it will reimburse Distributors, officers or directors or
controlling person or persons, defendant or defendants in the suit,
for the reasonable fees and expenses of any counsel retained by them.
The Issuer agrees to notify Distributors promptly of the commencement
of any litigation or proceedings against it or any of its officers or
trustees in connection with the issuance or sale of any of the shares.
Distributors also covenants and agrees that it will indemnify and
hold harmless the Issuer and each of its Board members and officers
and each person, if any, who controls the Issuer within the meaning of
Section 15 of the 1933 Act, against any loss, liability, damages,
claim or expense (including the reasonable cost of investigating or
defending any alleged loss, liability, damages, claim or expense and
reasonable counsel fees incurred in connection therewith) arising by
reason of any person acquiring any shares, based upon the 1933 Act or
any other statute or common law, alleging any wrongful act of
Distributors or any of its employees or alleging that the registration
statement, Prospectus, Statement of Additional Information,
shareholder reports or other information filed or made public by the
Issuer (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,
insofar as the statement or omission was made in reliance upon, and in
conformity with information furnished to the Issuer by or on behalf of
Distributors. In no case (i) is the indemnity of Distributors in
favor of the Issuer or any person indemnified to be deemed to protect
the Issuer or any person against any liability to which the Issuer 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, or (ii) is Distributors to be liable
under its indemnity agreement contained in this paragraph with respect
to any claim made against the Issuer or any person indemnified unless
the Issuer or person, as the case may be, shall have notified
Distributors in writing of the claim within a reasonable time after
the summons or other first written notification giving information of
the nature of the claim shall have been served upon the Issuer or any
such person (or after the Issuer or such person shall have received
notice of service on any designated agent). However, failure to
notify Distributors of any claim shall not relieve Distributors from
any liability which it may have to the Issuer or any person against
whom the action is brought otherwise than on account of its indemnity
agreement contained in this paragraph. In the case of any notice to
Distributors, it shall be entitled to participate, at its own expense,
in the defense or, if it so elects, to assume the defense of any suit
brought to enforce the claim, but if Distributors elects to assume the
defense, the defense shall be conducted by counsel chosen by it and
satisfactory to the Issuer, to its officers and Board and to any
controlling person or persons, defendant or defendants in the suit.
In the event that Distributors elects to assume the defense of any
suit and retain counsel, the Issuer or controlling persons, defendant
or defendants in the suit, shall bear the fees and expense of any
additional counsel retained by them. If Distributors does not elect
to assume the defense of any suit, it will reimburse the Issuer,
officers and Board or controlling person or persons, defendant or
defendants in the suit, for the reasonable fees and expenses of any
counsel retained by them. Distributors agrees to notify the Issuer
promptly of the commencement of any litigation or proceedings against
it in connection with the issue and sale of any of the shares.
12. Effective Date - This agreement shall be effective upon its
execution, and unless terminated as provided, shall continue in force
until March 31, 199 and thereafter from year to year, provided
continuance is approved annually by the vote of a majority of the
Board members of the Issuer, and by the vote of those Board members of
the Issuer who are not "interested persons" of the Issuer and, if a
plan under Rule 12b-1 under the Investment Company Act of 1940 is in
effect, by the vote of those Board members of the Issuer who are not
"interested persons" of the Issuer and who are not parties to the
Distribution and Service Plan or this Agreement and have no financial
interest in the operation of the Distribution and Service Plan or in
any agreements related to the Distribution and Service Plan, cast in
person at a meeting called for the purpose of voting on the approval.
This Agreement shall automatically terminate in the event of its
assignment. As used in this paragraph, the terms "assignment" and
"interested persons" shall have the respective meanings specified in
the Investment Company Act of 1940 as now in effect or as hereafter
amended. In addition to termination by failure to approve continuance
or by assignment, this Agreement may at any time be terminated by
either party upon not less than sixty days' prior written notice to
the other party.
13. Notice - Any notice required or permitted to be given by either
party to the other shall be deemed sufficient if sent by registered or
certified mail, postage prepaid, addressed by the party giving notice
to the other party at the last address furnished by the other party to
the party giving notice: if to the Issuer, at 82 Devonshire Street,
Boston, Massachusetts, and if to Distributors, at 82 Devonshire
Street, Boston, Massachusetts.
14. Limitation of Liability - Distributors is expressly put on notice
of the limitation of shareholder liability as set forth in the
Declaration of Trust or other organizational document of the Issuer
and agrees that the obligations assumed by the Issuer under this
contract shall be limited in all cases to the Issuer and its assets.
Distributors shall not seek satisfaction of any such obligation from
the shareholders or any shareholder of the Issuer. Nor shall
Distributors seek satisfaction of any such obligation from the
Trustees or any individual Trustee of the Issuer. Distributors
understands that the rights and obligations of each series of shares
of the Issuer under the Issuer's Declaration of Trust or other
organizational document are separate and distinct from those of any
and all other series.
15. 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.
IN WITNESS WHEREOF, the Issuer has executed this instrument in its
name and behalf, and its seal affixed, by one of its officers duly
authorized, and Distributors has executed this instrument in its name
and behalf by one of its officers duly authorized, as of the day and
year first above written.
[SIGNATURE LINES OMITTED]
Exhibit e(4)
FORM OF
SELLING DEALER AGREEMENT
(FOR BANK-RELATED TRANSACTIONS)
We at Fidelity Distributors Corporation invite you to distribute
shares of the mutual funds, or the separate series or classes of the
mutual funds, listed on Schedules A and B attached to this Agreement
(the "Portfolios"). We may periodically change the list of Portfolios
by giving you written notice of the change. We are the Portfolios'
principal underwriter and, as agent for the Portfolios, we offer to
sell Portfolio shares to you on the following terms:
1. Certain Defined Terms: (a) You
(_____________________________________) are registered as a
broker/dealer under the Securities Exchange Act of 1934 (the "1934
Act") and have executed a written agreement with a bank or bank
affiliate to provide brokerage services to that bank, bank affiliate
and/or their customers. As used in this Agreement, the term "Bank"
means a bank as defined in Section 3(a)(6) of the 1934 Act, or an
affiliate of such a bank, with which you have entered into a written
agreement to provide brokerage services; and the term "Bank Client"
means a customer of such a Bank.
(b) As used in this Agreement, the term "Prospectus" means the
applicable Portfolio's prospectus and related statement of additional
information, whether in paper format or electronic format, included in
the Portfolio's then currently effective registration statement (or
post-effective amendment thereto), and any information that we or the
Portfolio may issue to you as a supplement to such prospectus or
statement of additional information (a "sticker"), all as filed with
the Securities and Exchange Commission (the "SEC") pursuant to the
Securities Act of 1933.
2. Purchases of Portfolio Shares for Sale to Customers: (a) In
offering and selling Portfolio shares to your customers, you agree to
act as dealer for your own account; you are not authorized to act as
agent for us or for any Portfolio.
(b) You agree to offer and sell Portfolio shares to your customers
only at the applicable public offering price in accordance with the
Prospectus. If your customer qualifies for a reduced sales charge
pursuant to a special purchase plan (for example, a quantity discount,
letter of intent, or right of accumulation) as described in the
Prospectus, you agree to offer and sell Portfolio shares to your
customer at the applicable reduced sales charge. You agree to deliver
or cause to be delivered to each customer, at or prior to the time of
any purchase of shares, a copy of the then current prospectus
(including any stickers thereto), unless such prospectus has already
been delivered to the customer, and to each customer who so requests,
a copy of the then current statement of additional information
(including any stickers thereto).
(c) You agree to purchase Portfolio shares from us only to cover
purchase orders that you have already received from your customers, or
for your own investment. You also agree not to purchase any Portfolio
shares from your customers at a price lower than the applicable
redemption price, determined in the manner described in the
Prospectus. You will not withhold placing customers' orders so as to
profit yourself as a result of such withholding (for example, by a
change in a Portfolio's net asset value from that used in determining
the offering price to your customers).
(d) We will accept your purchase orders only at the public offering
price applicable to each order, as determined in accordance with the
Prospectus. We will not accept from you a conditional order for
Portfolio shares. All orders are subject to acceptance or rejection
by us in our sole discretion. We may, without notice, suspend sales
or withdraw the offering of Portfolio shares, or make a limited
offering of Portfolio shares.
(e) The placing of orders with us will be governed by instructions
that we will periodically issue to you. You must pay for Portfolio
shares in New York or Boston clearing house funds or in federal funds
in accordance with such instructions, and we must receive your payment
on or before the settlement date established in accordance with Rule
15c6-1 under the 1934 Act. If we do not receive your payment on or
before such settlement date, we may, without notice, cancel the sale,
or, at our option, sell the shares that you ordered back to the
issuing Portfolio, and we may hold you responsible for any loss
suffered by us or the issuing Portfolio as a result of your failure to
make payment as required.
(f) You agree to comply with all applicable state and federal laws
and with the rules and regulations of authorized regulatory agencies
thereunder. You agree to offer and sell Portfolio shares only in
states where you may legally offer and sell such Portfolio's shares.
You will not offer shares of any Portfolio for sale unless such shares
are registered for sale under the applicable state and federal laws
and the rules and regulations thereunder.
(g) Certificates evidencing Portfolio shares are not available; any
transaction in Portfolio shares will be effected and evidenced by
book-entry on the records maintained by Fidelity Investments
Institutional Operations Company ("FIIOC"). A confirmation statement
evidencing transactions in Portfolio shares will be transmitted to
you.
(h) You may designate FIIOC to execute your customers' transactions
in Portfolio shares in accordance with the terms of any account,
program, plan, or service established or used by your customers, and
to confirm each transaction to your customers on your behalf on a
fully disclosed basis. At the time of the transaction, you guarantee
the legal capacity of your customers and any co-owners of such shares
so transacting in such shares.
3. Your Compensation: (a) Your concession, if any, on your sales of
Portfolio shares will be as provided in the Prospectus or in the
applicable schedule of concessions issued by us and in effect at the
time of our sale to you. Upon written notice to you, we or any
Portfolio may change or discontinue any schedule of concessions, or
issue a new schedule.
(b) If a Portfolio has adopted a plan pursuant to Rule 12b-1 under
the Investment Company Act of 1940 (a "Plan"), we may make
distribution payments or service payments to you under the Plan. If a
Portfolio does not have a currently effective Plan, we or Fidelity
Management & Research Company may make distribution payments or
service payments to you from our own funds. Any distribution payments
or service payments will be made in the amount and manner set forth in
the Prospectus or in the applicable schedule of distribution payments
or service payments issued by us and then in effect. Upon written
notice to you, we or any Portfolio may change or discontinue any
schedule of distribution payments or service payments, or issue a new
schedule. A schedule of distribution payments or service payments
will be in effect with respect to a Portfolio that has a Plan only so
long as that Portfolio's Plan remains in effect.
(c) Concessions, distribution payments, and service payments apply
only with respect to (i) shares of the "Fidelity Funds" (as designated
on Schedule A attached to this Agreement) purchased or maintained for
the account of Bank Clients, and (ii) shares of the "Fidelity Advisor
Funds" (as designated on Schedule B attached to this Agreement).
Anything to the contrary notwithstanding, neither we nor any Portfolio
will provide to you, nor may you retain, concessions on your sales of
shares of, or distribution payments or service payments with respect
to assets of, the Fidelity Funds attributable to you or any of your
clients, other than Bank Clients. When you place an order in shares
of the Fidelity Funds with us, you will identify the Bank on behalf of
whose Clients you are placing the order; and you will identify as a
non-Bank Client Order, any order in shares of the Fidelity Funds
placed for the account of a non-Bank Client.
(d) After the effective date of any change in or discontinuance of
any schedule of concessions, distribution payments, or service
payments, or the termination of a Plan, any concessions, distribution
payments, or service payments will be allowable or payable to you only
in accordance with such change, discontinuance, or termination. You
agree that you will have no claim against us or any Portfolio by
virtue of any such change, discontinuance, or termination. In the
event of any overpayment by us of any concession, distribution
payment, or service payment, you will remit such overpayment.
(e) If any Portfolio shares sold to you by us under the terms of
this Agreement are redeemed by the issuing Portfolio or tendered for
redemption by the customer within seven (7) business days after the
date of our confirmation of your original purchase order for such
shares, you agree (i) to refund promptly to us the full amount of any
concession, distribution payment, or service payment allowed or paid
to you on such shares, and (ii) if not yet allowed or paid to you, to
forfeit the right to receive any concession, distribution payment, or
service payment allowable or payable to you on such shares. We will
notify you of any such redemption within ten (10) days after the date
of the redemption.
4. Certain Types of Accounts: (a) You may instruct FIIOC to
register purchased shares in your name and account as nominee for your
customers. If you hold Portfolio shares as nominee for your
customers, all Prospectuses, proxy statements, periodic reports, and
other printed material will be sent to you, and all confirmations and
other communications to shareholders will be transmitted to you. You
will be responsible for forwarding such printed material,
confirmations, and communications, or the information contained
therein, to all customers for whose account you hold any Portfolio
shares as nominee. However, we or FIIOC on behalf of itself or the
Portfolios will be responsible for the costs associated with your
forwarding such printed material, confirmations, and communications.
You will be responsible for complying with all reporting and tax
withholding requirements with respect to the customers for whose
account you hold any Portfolio shares as nominee.
(b) With respect to accounts other than those accounts referred to
in paragraph 4(a) above, you agree to provide us with all information
(including certification of taxpayer identification numbers and
back-up withholding instructions) necessary or appropriate for us to
comply with legal and regulatory reporting requirements.
(c) Accounts opened or maintained pursuant to the NETWORKING system
of the National Securities Clearing Corporation ("NSCC") will be
governed by applicable NSCC rules and procedures and any agreement or
other arrangement with us relating to NETWORKING.
(d) If you hold Portfolio shares in an omnibus account for two or
more customers, you will be responsible for determining, in accordance
with the Prospectus, whether, and the extent to which, a CDSC is
applicable to a purchase of Portfolio shares from such a customer, and
you agree to transmit immediately to us any CDSC to which such
purchase was subject. You hereby represent that if you hold Portfolio
shares subject to a CDSC, you have the capability to track and account
for such charge, and we reserve the right, at our discretion, to
verify that capability by inspecting your tracking and accounting
system or otherwise.
5. Status as Registered Broker/Dealer: (a) Each party to this
Agreement represents to the other party that (i) it is registered as a
broker/dealer under the 1934 Act, (ii) it is qualified to act as a
broker/dealer in the states where it transacts business, and (iii) it
is a member in good standing of the National Association of Securities
Dealers, Inc. ("NASD"). Each party agrees to maintain its
broker/dealer registration and qualifications and its NASD membership
in good standing throughout the term of this Agreement. Each party
agrees to abide by all of the NASD's rules and regulations, including
the NASD's Conduct Rules -- in particular, Section 2830 of such Rules,
which section is deemed a part of and is incorporated by reference in
this Agreement. This Agreement will terminate automatically without
notice in the event that either party's NASD membership is terminated.
(b) Nothing in this Agreement shall cause you to be our partner,
employee, or agent, or give you any authority to act for us or for any
Portfolio. Neither we nor any Portfolio shall be liable for any of
your acts or obligations as a dealer under this Agreement.
6. Information Relating to the Portfolios: (a) No person is
authorized to make any representations concerning shares of a
Portfolio other than those contained in the Portfolio's Prospectus.
In buying Portfolio shares from us under this Agreement, you will rely
only on the representations contained in the Prospectus. Upon your
request, we will furnish you with a reasonable number of copies of the
Portfolios' current prospectuses or statements of additional
information or both (including any stickers thereto).
(b) Any printed or electronic information that we furnish you
(other than the Portfolios' Prospectuses and periodic reports) is our
sole responsibility and not the responsibility of the respective
Portfolios. You agree that the Portfolios will have no liability or
responsibility to you with respect to any such printed or electronic
information. We or the respective Portfolio will bear the expense of
qualifying its shares under the state securities laws.
(c) You may not use any sales literature or advertising material
(including material disseminated through radio, television, or other
electronic media) concerning Portfolio shares, other than the printed
or electronic information referred to in paragraph 6(b) above, in
connection with the offer or sale of Portfolio shares without
obtaining our prior written approval. You may not distribute or make
available to investors any information that we furnish you marked "FOR
DEALER USE ONLY" or that otherwise indicates that it is confidential
or not intended to be distributed to investors.
7. Indemnification: (a) We will indemnify and hold you harmless
from any claim, demand, loss, expense, or cause of action resulting
from the misconduct or negligence, as measured by industry standards,
of us, our agents and employees, in carrying out our obligations under
this Agreement. Such indemnification will survive the termination of
this Agreement.
(b) You will indemnify and hold us harmless from any claim, demand,
loss, expense, or cause of action resulting from the misconduct or
negligence, as measured by industry standards, of you, your agents and
employees, in carrying out your obligations under this Agreement.
Such indemnification will survive the termination of this Agreement.
8. Customer Lists: We hereby agree that we shall not use any list of
your customers which may be obtained in connection with this Agreement
for the purpose of solicitation of any product or service without your
express written consent. However, nothing in this paragraph or
otherwise shall be deemed to prohibit or restrict us or our affiliates
in any way from solicitations of any product or service directed at,
without limitation, the general public, any segment thereof, or any
specific individual, provided such solicitation is not based upon such
list.
9. Duration of Agreement: This Agreement, with respect to any Plan,
will continue in effect for one year from its effective date, and
thereafter will continue automatically for successive annual periods;
provided, however, that such continuance is subject to termination at
any time without penalty if a majority of a Portfolio's Trustees who
are not interested persons of the Portfolio (as defined in the
Investment Company Act of 1940 (the "1940 Act")), or a majority of the
outstanding shares of the Portfolio, vote to terminate or not to
continue the Plan. This Agreement, other than with respect to a Plan,
will continue in effect from year to year after its effective date,
unless terminated as provided herein.
10. Amendment and Termination of Agreement: (a) We may amend any
provision of this Agreement by giving you written notice of the
amendment. Either party to this Agreement may terminate the Agreement
without cause by giving the other party at least thirty (30) days'
written notice of its intention to terminate. This Agreement will
terminate automatically in the event of its assignment (as defined in
the 1940 Act).
(b) In the event that (i) an application for a protective decree
under the provisions of the Securities Investor Protection Act of 1970
is filed against you; (ii) you file a petition in bankruptcy or a
petition seeking similar relief under any bankruptcy, insolvency, or
similar law, or a proceeding is commenced against you seeking such
relief; or (iii) you are found by the SEC, the NASD, or any other
federal or state regulatory agency or authority to have violated any
applicable federal or state law, rule or regulation arising out of
your activities as a broker/dealer or in connection with this
Agreement, this Agreement will terminate effective immediately upon
our giving notice of termination to you. You agree to notify us
promptly and to immediately suspend sales of Portfolio shares in the
event of any such filing or violation, or in the event that you cease
to be a member in good standing of the NASD.
(c) Your or our failure to terminate this Agreement for a
particular cause will not constitute a waiver of the right to
terminate this Agreement at a later date for the same or another
cause. The termination of this Agreement with respect to any one
Portfolio will not cause its termination with respect to any other
Portfolio.
11. Arbitration: In the event of a dispute, such dispute will be
settled by arbitration before arbitrators sitting in Boston,
Massachusetts in accordance with the NASD's Code of Arbitration
Procedure in effect at the time of the dispute. The arbitrators will
act by majority decision and their award may allocate attorneys' fees
and arbitration costs between us. Their award will be final and
binding between us, and such award may be entered as a judgment in any
court of competent jurisdiction.
12. Notices: All notices required or permitted to be given under this
Agreement shall be given in writing and delivered by personal
delivery, by postage prepaid mail, or by facsimile machine or a
similar means of same day delivery (with a confirming copy by mail).
All notices to us shall be given or sent to us at our offices located
at 82 Devonshire Street, Mail Zone L12A, Boston, Massachusetts 02109,
Attn: Bank Wholesale Market. All notices to you shall be given or
sent to you at the address specified by you below. Each of us may
change the address to which notices shall be sent by giving notice to
the other party in accordance with this paragraph 11.
13. Miscellaneous: This Agreement, as it may be amended from time to
time, shall become effective as of the date when it is accepted and
dated below by us. This Agreement is to be construed in accordance
with the laws of the Commonwealth of Massachusetts. This Agreement
supersedes and cancels any prior agreement between us, whether oral or
written, relating to the sale of shares of the Portfolios or any other
subject covered by this Agreement. The captions in this Agreement are
included for convenience of reference only and in no way define or
limit any of the provisions of this Agreement or otherwise affect
their construction or effect.
Very truly yours,
FIDELITY DISTRIBUTORS
CORPORATION
Please return two signed copies of this Agreement to Fidelity
Distributors Corporation. Upon acceptance, one countersigned copy
will be returned to you for your files.
[SIGNATURE LINES OMITTED]
Exhibit e(5)
FORM OF
SELLING DEALER AGREEMENT
We at Fidelity Distributors Corporation invite you
(______________________________) to distribute shares of the mutual
funds, or the separate series or classes of the mutual funds, listed
on Schedule A attached to this Agreement (the "Portfolios"). We may
periodically change the list of Portfolios by giving you written
notice of the change. We are the Portfolios' principal underwriter
and, as agent for the Portfolios, we offer to sell Portfolio shares to
you on the following terms:
1. Certain Defined Terms: As used in this Agreement, the term
"Prospectus" means the applicable Portfolio's prospectus and related
statement of additional information, whether in paper format or
electronic format, included in the Portfolio's then currently
effective registration statement (or post-effective amendment
thereto), and any information that we or the Portfolio may issue to
you as a supplement to such prospectus or statement of additional
information (a "sticker"), all as filed with the Securities and
Exchange Commission (the "SEC") pursuant to the Securities Act of
1933.
2. Purchases of Portfolio Shares for Sale to Customers: (a) In
offering and selling Portfolio shares to your customers, you agree to
act as dealer for your own account; you are not authorized to act as
agent for us or for any Portfolio.
(b) You agree to offer and sell Portfolio shares to your customers
only at the applicable public offering price in accordance with the
Prospectus. If your customer qualifies for a reduced sales charge
pursuant to a special purchase plan (for example, a quantity discount,
letter of intent, or right of accumulation) as described in the
Prospectus, you agree to offer and sell Portfolio shares to your
customer at the applicable reduced sales charge. You agree to deliver
or cause to be delivered to each customer, at or prior to the time of
any purchase of shares, a copy of the then current prospectus
(including any stickers thereto), unless such prospectus has already
been delivered to the customer, and to each customer who so requests,
a copy of the then current statement of additional information
(including any stickers thereto).
(c) You agree to purchase Portfolio shares from us only to cover
purchase orders that you have already received from your customers, or
for your own investment. You also agree not to purchase any Portfolio
shares from your customers at a price lower than the applicable
redemption price, determined in the manner described in the
Prospectus. You will not withhold placing customers' orders so as to
profit yourself as a result of such withholding (for example, by a
change in a Portfolio's net asset value from that used in determining
the offering price to your customers).
(d) We will accept your purchase orders only at the public offering
price applicable to each order, as determined in accordance with the
Prospectus. We will not accept from you a conditional order for
Portfolio shares. All orders are subject to acceptance or rejection
by us in our sole discretion. We may, without notice, suspend sales
or withdraw the offering of Portfolio shares, or make a limited
offering of Portfolio shares.
(e) The placing of orders with us will be governed by instructions
that we will periodically issue to you. You must pay for Portfolio
shares in New York or Boston clearing house funds or in federal funds
in accordance with such instructions, and we must receive your payment
on or before the settlement date established in accordance with Rule
15c6-1 under the Securities Exchange Act of 1934 (the "1934 Act"). If
we do not receive your payment on or before such settlement date, we
may, without notice, cancel the sale, or, at our option, sell the
shares that you ordered back to the issuing Portfolio, and we may hold
you responsible for any loss suffered by us or the issuing Portfolio
as a result of your failure to make payment as required.
(f) You agree to comply with all applicable state and federal laws
and with the rules and regulations of authorized regulatory agencies
thereunder. You agree to offer and sell Portfolio shares only in
states where you may legally offer and sell such Portfolio's shares.
You will not offer shares of any Portfolio for sale unless such shares
are registered for sale under the applicable state and federal laws
and the rules and regulations thereunder.
(g) Certificates evidencing Portfolio shares are not available; any
transaction in Portfolio shares will be effected and evidenced by
book-entry on the records maintained by Fidelity Investments
Institutional Operations Company ("FIIOC"). A confirmation statement
evidencing transactions in Portfolio shares will be transmitted to
you.
(h) You may designate FIIOC to execute your customers' transactions
in Portfolio shares in accordance with the terms of any account,
program, plan, or service established or used by your customers, and
to confirm each transaction to your customers on your behalf. At the
time of the transaction, you guarantee the legal capacity of your
customers and any co-owners of such shares so transacting in such
shares.
3. Your Compensation: (a) Your concession, if any, on your sales of
Portfolio shares will be as provided in the Prospectus or in the
applicable schedule of concessions issued by us and in effect at the
time of our sale to you. Upon written notice to you, we or any
Portfolio may change or discontinue any schedule of concessions, or
issue a new schedule.
(b) If a Portfolio has adopted a plan pursuant to Rule 12b-1 under
the Investment Company Act of 1940 (a "Plan"), we may make
distribution payments or service payments to you under the Plan. If a
Portfolio does not have a currently effective Plan, we or Fidelity
Management & Research Company may make distribution payments or
service payments to you from our own funds. Any distribution payments
or service payments will be made in the amount and manner set forth in
the Prospectus or in the applicable schedule of distribution payments
or service payments issued by us and then in effect. Upon written
notice to you, we or any Portfolio may change or discontinue any
schedule of distribution payments or service payments, or issue a new
schedule. A schedule of distribution payments or service payments
will be in effect with respect to a Portfolio that has a Plan only so
long as that Portfolio's Plan remains in effect.
(c) After the effective date of any change in or discontinuance of
any schedule of concessions, distribution payments, or service
payments, or the termination of a Plan, any concessions, distribution
payments, or service payments will be allowable or payable to you only
in accordance with such change, discontinuance, or termination. You
agree that you will have no claim against us or any Portfolio by
virtue of any such change, discontinuance, or termination. In the
event of any overpayment by us of any concession, distribution
payment, or service payment, you will remit such overpayment.
(d) If any Portfolio shares sold to you by us under the terms of
this Agreement are redeemed by the issuing Portfolio or tendered for
redemption by the customer within seven (7) business days after the
date of our confirmation of your original purchase order for such
shares, you agree (i) to refund promptly to us the full amount of any
concession, distribution payment, or service payment allowed or paid
to you on such shares, and (ii) if not yet allowed or paid to you, to
forfeit the right to receive any concession, distribution payment, or
service payment allowable or payable to you on such shares. We will
notify you of any such redemption within ten (10) days after the date
of the redemption.
4. Certain Types of Accounts: (a) You may instruct FIIOC to
register purchased shares in your name and account as nominee for your
customers. If you hold Portfolio shares as nominee for your
customers, all Prospectuses, proxy statements, periodic reports, and
other printed material will be sent to you, and all confirmations and
other communications to shareholders will be transmitted to you. You
will be responsible for forwarding such printed material,
confirmations, and communications, or the information contained
therein, to all customers for whose account you hold any Portfolio
shares as nominee. However, we or FIIOC on behalf of itself or the
Portfolios will be responsible for the costs associated with your
forwarding such printed material, confirmations, and communications.
You will be responsible for complying with all reporting and tax
withholding requirements with respect to the customers for whose
account you hold any Portfolio shares as nominee.
(b) With respect to accounts other than those accounts referred to
in paragraph 4(a) above, you agree to provide us with all information
(including certification of taxpayer identification numbers and
back-up withholding instructions) necessary or appropriate for us to
comply with legal and regulatory reporting requirements.
(c) Accounts opened or maintained pursuant to the NETWORKING system
of the National Securities Clearing Corporation ("NSCC") will be
governed by applicable NSCC rules and procedures and any agreement or
other arrangement with us relating to NETWORKING.
(d) If you hold Portfolio shares in an omnibus account for two or
more customers, you will be responsible for determining, in accordance
with the Prospectus, whether, and the extent to which, a CDSC is
applicable to a purchase of Portfolio shares from such a customer, and
you agree to transmit immediately to us any CDSC to which such
purchase was subject. You hereby represent that if you hold Portfolio
shares subject to a CDSC, you have the capability to track and account
for such charge, and we reserve the right, at our discretion, to
verify that capability by inspecting your tracking and accounting
system or otherwise.
5. Status as Registered Broker/Dealer: (a) Each party to this
Agreement represents to the other party that (i) it is registered as a
broker/dealer under the 1934 Act, (ii) it is qualified to act as a
broker/dealer in the states where it transacts business, and (iii) it
is a member in good standing of the National Association of Securities
Dealers, Inc. ("NASD"). Each party agrees to maintain its
broker/dealer registration and qualifications and its NASD membership
in good standing throughout the term of this Agreement. Each party
agrees to abide by all of the NASD's rules and regulations, including
the NASD's Conduct Rules -- in particular, Section 2830 of such Rules,
which section is deemed a part of and is incorporated by reference in
this Agreement. This Agreement will terminate automatically without
notice in the event that either party's NASD membership is terminated.
(b) Nothing in this Agreement shall cause you to be our partner,
employee, or agent, or give you any authority to act for us or for any
Portfolio. Neither we nor any Portfolio shall be liable for any of
your acts or obligations as a dealer under this Agreement.
6. Information Relating to the Portfolios: (a) No person is
authorized to make any representations concerning shares of a
Portfolio other than those contained in the Portfolio's Prospectus.
In buying Portfolio shares from us under this Agreement, you will rely
only on the representations contained in the Prospectus. Upon your
request, we will furnish you with a reasonable number of copies of the
Portfolios' current prospectuses or statements of additional
information or both (including any stickers thereto).
(b) Any printed or electronic information that we furnish you
(other than the Portfolios' Prospectuses and periodic reports) is our
sole responsibility and not the responsibility of the respective
Portfolios. You agree that the Portfolios will have no liability or
responsibility to you with respect to any such printed or electronic
information. We or the respective Portfolio will bear the expense of
qualifying its shares under the state securities laws.
(c) You may not use any sales literature or advertising material
(including material disseminated through radio, television, or other
electronic media) concerning Portfolio shares, other than the printed
or electronic information referred to in paragraph 6(b) above, in
connection with the offer or sale of Portfolio shares without
obtaining our prior written approval. You may not distribute or make
available to investors any information that we furnish you marked "FOR
DEALER USE ONLY" or that otherwise indicates that it is confidential
or not intended to be distributed to investors.
7. Indemnification: (a) We will indemnify and hold you harmless
from any claim, demand, loss, expense, or cause of action resulting
from the misconduct or negligence, as measured by industry standards,
of us, our agents and employees, in carrying out our obligations under
this Agreement. Such indemnification will survive the termination of
this Agreement.
(b) You will indemnify and hold us harmless from any claim, demand,
loss, expense, or cause of action resulting from the misconduct or
negligence, as measured by industry standards, of you, your agents and
employees, in carrying out your obligations under this Agreement.
Such indemnification will survive the termination of this Agreement.
8. Customer Lists: We hereby agree that we shall not use any list of
your customers which may be obtained in connection with this Agreement
for the purpose of solicitation of any product or service without your
express written consent. However, nothing in this paragraph or
otherwise shall be deemed to prohibit or restrict us or our affiliates
in any way from solicitations of any product or service directed at,
without limitation, the general public, any segment thereof, or any
specific individual, provided such solicitation is not based upon such
list.
9. Duration of Agreement: This Agreement, with respect to any Plan,
will continue in effect for one year from its effective date, and
thereafter will continue automatically for successive annual periods;
provided, however, that such continuance is subject to termination at
any time without penalty if a majority of a Portfolio's Trustees who
are not interested persons of the Portfolio (as defined in the
Investment Company Act of 1940 (the "1940 Act")), or a majority of the
outstanding shares of the Portfolio, vote to terminate or not to
continue the Plan. This Agreement, other than with respect to a Plan,
will continue in effect from year to year after its effective date,
unless terminated as provided herein.
10. Amendment and Termination of Agreement: (a) We may amend any
provision of this Agreement by giving you written notice of the
amendment. Either party to this Agreement may terminate the Agreement
without cause by giving the other party at least thirty (30) days'
written notice of its intention to terminate. This Agreement will
terminate automatically in the event of its assignment (as defined in
the 1940 Act).
(b) In the event that (i) an application for a protective decree
under the provisions of the Securities Investor Protection Act of 1970
is filed against you; (ii) you file a petition in bankruptcy or a
petition seeking similar relief under any bankruptcy, insolvency, or
similar law, or a proceeding is commenced against you seeking such
relief; or (iii) you are found by the SEC, the NASD, or any other
federal or state regulatory agency or authority to have violated any
applicable federal or state law, rule or regulation arising out of
your activities as a broker/dealer or in connection with this
Agreement, this Agreement will terminate effective immediately upon
our giving notice of termination to you. You agree to notify us
promptly and to immediately suspend sales of Portfolio shares in the
event of any such filing or violation, or in the event that you cease
to be a member in good standing of the NASD.
(c) Your or our failure to terminate this Agreement for a
particular cause will not constitute a waiver of the right to
terminate this Agreement at a later date for the same or another
cause. The termination of this Agreement with respect to any one
Portfolio will not cause its termination with respect to any other
Portfolio.
11. Arbitration: In the event of a dispute, such dispute will be
settled by arbitration before arbitrators sitting in Boston,
Massachusetts in accordance with the NASD's Code of Arbitration
Procedure in effect at the time of the dispute. The arbitrators will
act by majority decision and their award may allocate attorneys' fees
and arbitration costs between us. Their award will be final and
binding between us, and such award may be entered as a judgment in any
court of competent jurisdiction.
12. Notices: All notices required or permitted to be given under this
Agreement shall be given in writing and delivered by personal
delivery, by postage prepaid mail, or by facsimile machine or a
similar means of same day delivery (with a confirming copy by mail).
All notices to us shall be given or sent to us at our offices located
at 82 Devonshire Street, Mail Zone L10A, Boston, Massachusetts 02109,
Attn: Broker Dealer Services Group. All notices to you shall be given
or sent to you at the address specified by you below. Each of us may
change the address to which notices shall be sent by giving notice to
the other party in accordance with this paragraph 12.
13. Miscellaneous: This Agreement, as it may be amended from time to
time, shall become effective as of the date when it is accepted and
dated below by us. This Agreement is to be construed in accordance
with the laws of the Commonwealth of Massachusetts. This Agreement
supersedes and cancels any prior agreement between us, whether oral or
written, relating to the sale of shares of the Portfolios or any other
subject covered by this Agreement. The captions in this Agreement are
included for convenience of reference only and in no way define or
limit any of the provisions of this Agreement or otherwise affect
their construction or effect.
Very truly yours,
FIDELITY DISTRIBUTORS
CORPORATION
Please return two signed copies of this Agreement to Fidelity
Distributors Corporation. Upon acceptance, one countersigned copy
will be returned to you for your files.
[SIGNATURE LINES OMITTED]
Exhibit e(6)
FORM OF
BANK AGENCY AGREEMENT
We at Fidelity Distributors Corporation offer to make available to
your customers shares of the mutual funds, or the separate series or
classes of the mutual funds, listed on Schedules A and B attached to
this Agreement (the "Portfolios"). We may periodically change the
list of Portfolios by giving you written notice of the change. We are
the Portfolios' principal underwriter and act as agent for the
Portfolios. You (____________________________________) are a division
or affiliate of a bank (____________________________________) and
desire to make Portfolio shares available to your customers on the
following terms:
1. Certain Defined Terms: As used in this Agreement, the term
"Prospectus" means the applicable Portfolio's prospectus and related
statement of additional information, whether in paper format or
electronic format, included in the Portfolio's then currently
effective registration statement (or post-effective amendment
thereto), and any information that we or the Portfolio may issue to
you as a supplement to such prospectus or statement of additional
information (a "sticker"), all as filed with the Securities and
Exchange Commission (the "SEC") pursuant to the Securities Act of
1933.
2. Making Portfolio Shares Available to Your Customers: (a) In all
transactions covered by this Agreement: (i) you will act as agent for
your customers; in no transaction are you authorized to act as agent
for us or for any Portfolio; (ii) you will initiate transactions only
upon your customers' orders; (iii) we will execute transactions only
upon receiving instructions from you acting as agent for your
customers; and (iv) each transaction will be for your customer's
account and not for your own account. Each transaction will be
without recourse to you, provided that you act in accordance with the
terms of this Agreement.
(b) You agree to make Portfolio shares available to your customers
only at the applicable public offering price in accordance with the
Prospectus. If your customer qualifies for a reduced sales charge
pursuant to a special purchase plan (for example, a quantity discount,
letter of intent, or right of accumulation) as described in the
Prospectus, you agree to make Portfolio shares available to your
customer at the applicable reduced sales charge. You agree to deliver
or cause to be delivered to each customer, at or prior to the time of
any purchase of shares, a copy of the then current prospectus
(including any stickers thereto), unless such prospectus has already
been delivered to the customer, and to each customer who so requests,
a copy of the then current statement of additional information
(including any stickers thereto).
(c) You agree to order Portfolio shares from us only to cover
purchase orders that you have already received from your customers, or
for your own investment. You will not withhold placing customers'
orders so as to profit yourself as a result of such withholding (for
example, by a change in a Portfolio's net asset value from that used
in determining the offering price to your customers).
(d) We will accept your purchase orders only at the public offering
price applicable to each order, as determined in accordance with the
Prospectus. We will not accept from you a conditional order for
Portfolio shares. All orders are subject to acceptance or rejection
by us in our sole discretion. We may, without notice, suspend sales
or withdraw the offering of Portfolio shares, or make a limited
offering of Portfolio shares.
(e) The placing of orders with us will be governed by instructions
that we will periodically issue to you. You must pay for Portfolio
shares in New York or Boston clearing house funds or in federal funds
in accordance with such instructions, and we must receive your payment
on or before the settlement date established in accordance with Rule
15c6-1 under the Securities Exchange Act of 1934 (the "1934 Act").
(f) You agree to comply with all applicable state and federal laws
and with the rules and regulations of authorized regulatory agencies
thereunder. You agree to make Portfolio shares available to your
customers only in states where you may legally make such Portfolio's
shares available. You will not make available shares of any Portfolio
unless such shares are registered under the applicable state and
federal laws and the rules and regulations thereunder.
(g) Certificates evidencing Portfolio shares are not available; any
transaction in Portfolio shares will be effected and evidenced by
book-entry on the records maintained by Fidelity Investments
Institutional Operations Company ("FIIOC"). A confirmation statement
evidencing transactions in Portfolio shares will be transmitted to
you.
(h) You may designate FIIOC to execute your customers' transactions
in Portfolio shares in accordance with the terms of any account,
program, plan, or service established or used by your customers, and
to confirm each transaction to your customers on your behalf on a
fully disclosed basis. At the time of the transaction, you guarantee
the legal capacity of your customers and any co-owners of such shares
so transacting in such shares.
3. Your Compensation: (a) Your fee, if any, for acting as agent
with respect to sales of Portfolio shares will be as provided in the
Prospectus or in the applicable schedule of agency fees issued by us
and in effect at the time of the sale. Upon written notice to you, we
or any Portfolio may change or discontinue any schedule of agency
fees, or issue a new schedule.
(b) If a Portfolio has adopted a plan pursuant to Rule 12b-1 under
the Investment Company Act of 1940 (a "Plan"), we may make
distribution payments or service payments to you under the Plan. If a
Portfolio does not have a currently effective Plan, we or Fidelity
Management & Research Company may make distribution payments or
service payments to you from our own funds. Any distribution payments
or service payments will be made in the amount and manner set forth in
the Prospectus or in the applicable schedule of distribution payments
or service payments issued by us and then in effect. Upon written
notice to you, we or any Portfolio may change or discontinue any
schedule of distribution payments or service payments, or issue a new
schedule. A schedule of distribution payments or service payments
will be in effect with respect to a Portfolio that has a Plan only so
long as that Portfolio's Plan remains in effect.
(c) After the effective date of any change in or discontinuance of
any schedule of agency fees, distribution payments, or service
payments, or the termination of a Plan, any agency fees, distribution
payments, or service payments will be allowable or payable to you only
in accordance with such change, discontinuance, or termination. You
agree that you will have no claim against us or any Portfolio by
virtue of any such change, discontinuance, or termination. In the
event of any overpayment by us of any agency fee, distribution
payment, or service payment, you will remit such overpayment.
(d) If, within seven (7) business days after our confirmation of
the original purchase order for shares of a Portfolio, such shares are
redeemed by the issuing Portfolio or tendered for redemption by the
customer, you agree (i) to refund promptly to us the full amount of
any agency fee, distribution payment, or service payment paid to you
on such shares, and (ii) if not yet paid to you, to forfeit the right
to receive any agency fee, distribution payment, or service payment
payable to you on such shares. We will notify you of any such
redemption within ten (10) days after the date of the redemption.
4. Certain Types of Accounts: (a) You may instruct FIIOC to
register purchased shares in your name and account as nominee for your
customers. If you hold Portfolio shares as nominee for your
customers, all Prospectuses, proxy statements, periodic reports, and
other printed material will be sent to you, and all confirmations and
other communications to shareholders will be transmitted to you. You
will be responsible for forwarding such printed material,
confirmations, and communications, or the information contained
therein, to all customers for whose account you hold any Portfolio
shares as nominee. However, we or FIIOC on behalf of itself or the
Portfolios will be responsible for the costs associated with your
forwarding such printed material, confirmations, and communications.
You will be responsible for complying with all reporting and tax
withholding requirements with respect to the customers for whose
account you hold any Portfolio shares as nominee.
(b) With respect to accounts other than those accounts referred to
in paragraph 4(a) above, you agree to provide us with all information
(including certification of taxpayer identification numbers and
back-up withholding instructions) necessary or appropriate for us to
comply with legal and regulatory reporting requirements.
(c) Accounts opened or maintained pursuant to the NETWORKING system
of the National Securities Clearing Corporation ("NSCC") will be
governed by applicable NSCC rules and procedures and any agreement or
other arrangement with us relating to NETWORKING.
(d) If you hold Portfolio shares in an omnibus account for two or
more customers, you will be responsible for determining, in accordance
with the Prospectus, whether, and the extent to which, a CDSC is
applicable to a purchase of Portfolio shares from such a customer, and
you agree to transmit immediately to us any CDSC to which such
purchase was subject. You hereby represent that if you hold Portfolio
shares subject to a CDSC, you have the capability to track and account
for such charge, and we reserve the right, at our discretion, to
verify that capability by inspecting your tracking and accounting
system or otherwise.
5. Status as Registered Broker/Dealer or "Bank": (a) Each party to
this Agreement represents to the other party that it is either (i) a
registered broker/dealer under the 1934 Act, or (ii) a "bank" as
defined in Section 3(a)(6) of the 1934 Act.
(b) If a party is a registered broker/dealer, such party represents
that it is qualified to act as a broker/dealer in the states where it
transacts business, and it is a member in good standing of the
National Association of Securities Dealers, Inc. ("NASD"). It agrees
to maintain its broker/dealer registration and qualifications and its
NASD membership in good standing throughout the term of this
Agreement. It agrees to abide by all of the NASD's rules and
regulations, including the NASD's Conduct Rules -- in particular,
Section 2830 of such Rules, which section is deemed a part of and is
incorporated by reference in this Agreement. This Agreement will
terminate automatically without notice in the event that a party's
NASD membership is terminated.
(c) If you are a "bank", you represent that you are duly authorized
to engage in the transactions to be performed under this Agreement,
and you agree to comply with all applicable federal and state laws,
including the rules and regulations of all applicable federal and
state bank regulatory agencies and authorities. This Agreement will
terminate automatically without notice in the event that you cease to
be a "bank" as defined in Section 3(a)(6) of the 1934 Act.
(d) Nothing in this Agreement shall cause you to be our partner,
employee, or agent, or give you any authority to act for us or for any
Portfolio. Neither we nor any Portfolio shall be liable for any of
your acts or obligations as a dealer under this Agreement.
6. Information Relating to the Portfolios: (a) No person is
authorized to make any representations concerning shares of a
Portfolio other than those contained in the Portfolio's Prospectus.
In ordering Portfolio shares from us under this Agreement, you will
rely only on the representations contained in the Prospectus. Upon
your request, we will furnish you with a reasonable number of copies
of the Portfolios' current prospectuses or statements of additional
information or both (including any stickers thereto).
(b) Any printed or electronic information that we furnish you
(other than the Portfolios' Prospectuses and periodic reports) is our
sole responsibility and not the responsibility of the respective
Portfolios. You agree that the Portfolios will have no liability or
responsibility to you with respect to any such printed or electronic
information. We or the respective Portfolio will bear the expense of
qualifying its shares under the state securities laws.
(c) You may not use any sales literature or advertising material
(including material disseminated through radio, television, or other
electronic media) concerning Portfolio shares, other than the printed
or electronic information referred to in paragraph 6(b) above, in
connection with making Portfolio shares available to your customers
without obtaining our prior written approval. You may not distribute
or make available to investors any information that we furnish you
marked "FOR DEALER USE ONLY" or that otherwise indicates that it is
confidential or not intended to be distributed to investors.
7. Indemnification: (a) We will indemnify and hold you harmless
from any claim, demand, loss, expense, or cause of action resulting
from the misconduct or negligence, as measured by industry standards,
of us, our agents and employees, in carrying out our obligations under
this Agreement. Such indemnification will survive the termination of
this Agreement.
(b) You will indemnify and hold us harmless from any claim, demand,
loss, expense, or cause of action resulting from the misconduct or
negligence, as measured by industry standards, of you, your agents and
employees, in carrying out your obligations under this Agreement.
Such indemnification will survive the termination of this Agreement.
8. Customer Lists: We hereby agree that we shall not use any list of
your customers which may be obtained in connection with this Agreement
for the purpose of solicitation of any product or service without your
express written consent. However, nothing in this paragraph or
otherwise shall be deemed to prohibit or restrict us or our affiliates
in any way from solicitations of any product or service directed at,
without limitation, the general public, any segment thereof, or any
specific individual, provided such solicitation is not based upon such
list.
9. Duration of Agreement: This Agreement, with respect to any Plan,
will continue in effect for one year from its effective date, and
thereafter will continue automatically for successive annual periods;
provided, however, that such continuance is subject to termination at
any time without penalty if a majority of a Portfolio's Trustees who
are not interested persons of the Portfolio (as defined in the
Investment Company Act of 1940 (the "1940 Act")), or a majority of the
outstanding shares of the Portfolio, vote to terminate or not to
continue the Plan. This Agreement, other than with respect to a Plan,
will continue in effect from year to year after its effective date,
unless terminated as provided herein.
10. Amendment and Termination of Agreement: (a) We may amend any
provision of this Agreement by giving you written notice of the
amendment. Either party to this Agreement may terminate the Agreement
without cause by giving the other party at least thirty (30) days'
written notice of its intention to terminate. This Agreement will
terminate automatically in the event of its assignment (as defined in
the 1940 Act).
(b) In the event that (i) an application for a protective decree
under the provisions of the Securities Investor Protection Act of 1970
is file against you; (ii) you file a petition in bankruptcy or a
petition seeking similar relief under any bankruptcy, insolvency, or
similar law, or a proceeding is commenced against you seeking such
relief; or (iii) you are found by the SEC, the NASD, or any other
federal or state regulatory agency or authority to have violated any
applicable federal or state law, rule or regulation arising out of
your activities as a broker/dealer or in connection with this
Agreement, this Agreement will terminate effective immediately upon
our giving notice of termination to you. You agree to notify us
promptly and to immediately suspend making Portfolio shares available
to your customers in the event of any such filing or violation, or in
the event that you cease to be a member in good standing of the NASD
or you cease to be a "bank" as defined in Section 3(a)(6) of the 1934
Act.
(c) Your or our failure to terminate this Agreement for a
particular cause will not constitute a waiver of the right to
terminate this Agreement at a later date for the same or another
cause. The termination of this Agreement with respect to any one
Portfolio will not cause its termination with respect to any other
Portfolio.
11. Arbitration: In the event of a dispute, such dispute will be
settled by arbitration before arbitrators sitting in Boston,
Massachusetts in accordance with the NASD's Code of Arbitration
Procedure in effect at the time of the dispute. The arbitrators will
act by majority decision and their award may allocate attorneys' fees
and arbitration costs between us. Their award will be final and
binding between us, and such award may be entered as a judgment in any
court of competent jurisdiction.
12. Notices: All notices required or permitted to be given under this
Agreement shall be given in writing and delivered by personal
delivery, by postage prepaid mail, or by facsimile machine or a
similar means of same day delivery (with a confirming copy by mail).
All notices to us shall be given or sent to us at our offices located
at 82 Devonshire Street, Mail Zone L12A, Boston, Massachusetts 02109,
Attn: Bank Wholesale Market. All notices to you shall be given or
sent to you at the address specified by you below. Each of us may
change the address to which notices shall be sent by giving notice to
the other party in accordance with this paragraph 12.
13. Miscellaneous: This Agreement, as it may be amended from time to
time, shall become effective as of the date when it is accepted and
dated below by us. This Agreement is to be construed in accordance
with the laws of the Commonwealth of Massachusetts. This Agreement
supersedes and cancels any prior agreement between us, whether oral or
written, relating to the sale of shares of the Portfolios or any other
subject covered by this Agreement. The captions in this Agreement are
included for convenience of reference only and in no way define or
limit any of the provisions of this Agreement or otherwise affect
their construction or effect.
Very truly yours,
FIDELITY DISTRIBUTORS
CORPORATION
Please return two signed copies of this Agreement to Fidelity
Distributors Corporation. Upon acceptance, one countersigned copy
will be returned to you for your files.
[SIGNATURE LINES OMITTED]
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference into the
Prospectuses and Statement of Additional Information in Post-Effective
Amendment No. 37 to the Registration Statement on Form N-1A of Newbury
Street Trust: Prime Fund, Treasury Fund and Tax-Exempt Fund of our
reports dated December 18, 1998 on the financial statements and
financial highlights included in the October 31, 1998 Annual Reports
to Shareholders of Prime Fund, Treasury Fund and Tax-Exempt Fund.
We further consent to the references to our Firm under the headings
"Financial Highlights" in the Prospectuses and "Auditor" in the
Statement of Additional Information.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Boston, Massachusetts
December 23, 1998
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<NAME> Newbury Street Trust
<SERIES>
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<NAME> Treasury Fund - Capital Reserves Class
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<NAME> Newbury Street Trust
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<CIK> 0000704207
<NAME> Newbury Street Trust
<SERIES>
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<NAME> Treasury Fund - Adv. C Class
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