SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT (No. 2-84776)
UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 45 [X]
and
REGISTRATION STATEMENT (No. 811-3785)
UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 45 [X]
Fidelity Advisor Series I
(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 (September 6, 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.
Fidelity Advisor Series I:
Fidelity Advisor Small Cap Fund Institutional Class Prospectus
Cross Reference Sheet
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FORM N-1A PROSPECTUS SECTION
ITEM NUMBER
1 COVER PAGE
2 A EXPENSES
B, C *
3 A *
B *
C *
D *
4 A I CHARTER
II INVESTMENT PRINCIPLES AND RISKS; SECURITIES AND INVESTMENT PRACTICES
B INVESTMENT PRINCIPLES AND RISKS; SECURITIES AND INVESTMENT PRACTICES
C WHO MAY WANT TO INVEST; INVESTMENT PRINCIPLES AND RISKS
5 A CHARTER
B I CHARTER
II CHARTER
III EXPENSES; BREAKDOWN OF EXPENSES
C CHARTER
D CHARTER; BREAKDOWN OF EXPENSES
E CHARTER; BREAKDOWN OF EXPENSES
F EXPENSES; BREAKDOWN OF EXPENSES
G I CHARTER
II *
5A *
6 A I CHARTER
II HOW TO BUY SHARES; HOW TO SELL SHARES; TRANSACTION DETAILS; EXCHANGE
RESTRICTIONS
III CHARTER
B CHARTER
C TRANSACTIONS DETAILS; EXCHANGE RESTRICTIONS
D WHO MAY WANT TO INVEST
E COVER PAGE; HOW TO BUY SHARES; HOW TO SELL SHARES; INVESTOR SERVICES
F, G DIVIDENDS, CAPITAL GAINS, AND TAXES
H WHO MAY WANT TO INVEST
7 A COVER PAGE; CHARTER
B HOW TO BUY SHARES; TRANSACTION DETAILS
C *
D HOW TO BUY SHARES
E *
F BREAKDOWN OF EXPENSES
G *
8 HOW TO SELL SHARES; TRANSACTION DETAILS; EXCHANGE RESTRICTIONS
9 *
</TABLE>
______________
* Not Applicable
Fidelity Advisor Series I:
Fidelity Advisor Small Cap Fund Class A, Class T, Class B and Class C
Prospectus
Cross Reference Sheet
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FORM N-1A PROSPECTUS SECTION
ITEM NUMBER
1 COVER PAGE
2 A EXPENSES
B, C CONTENTS; WHO MAY WANT TO INVEST
3 A *
B *
C *
D *
4 A I CHARTER
II INVESTMENT PRINCIPLES AND RISKS; SECURITIES AND INVESTMENT PRACTICES
B INVESTMENT PRINCIPLES AND RISKS; SECURITIES AND INVESTMENT PRACTICES
C WHO MAY WANT TO INVEST; INVESTMENT PRINCIPLES AND RISKS
5 A CHARTER
B I CHARTER
II CHARTER
III EXPENSES; BREAKDOWN OF EXPENSES
C CHARTER
D CHARTER; BREAKDOWN OF EXPENSES
E CHARTER; BREAKDOWN OF EXPENSES
F EXPENSES; BREAKDOWN OF EXPENSES
G I CHARTER
II *
5A *
6 A I CHARTER
II HOW TO BUY SHARES; HOW TO SELL SHARES; TRANSACTION DETAILS; EXCHANGE
RESTRICTIONS
III CHARTER
B CHARTER
C TRANSACTION DETAILS; EXCHANGE RESTRICTIONS
D WHO MAY WANT TO INVEST
E COVER PAGE; HOW TO BUY SHARES; HOW TO SELL SHARES; INVESTOR SERVICES
F, G DIVIDENDS, CAPITAL GAINS, AND TAXES
H WHO MAY WANT TO INVEST
7 A COVER PAGE; CHARTER
B HOW TO BUY SHARES; TRANSACTION DETAILS
C SALES CHARGE REDUCTIONS AND WAIVERS
D HOW TO BUY SHARES
E *
F EXPENSES; BREAKDOWN OF EXPENSES
G EXPENSES; TRANSACTION DETAILS
8 HOW TO SELL SHARES; INVESTOR SERVICES; TRANSACTION DETAILS; EXCHANGE
RESTRICTIONS
9 *
</TABLE>
______________
* Not Applicable
Please read this prospectus before investing, and keep it on file for
future reference. It contains important information, including how the
fund invests and the services available to shareholders.
FIDELITY
ADVISOR SMALL CAP
FUND
INSTITUTIONAL CLASS
To learn more about the fund and its investments, you can obtain a
copy of the fund's Statement of Additional Information (SAI) dated
September 6, 1998. The SAI has been filed with the Securities and
Exchange Commission (SEC) and is available along with other related
materials on the SEC's Internet Web site (http://www.sec.gov). The SAI
is incorporated herein by reference (legally forms a part of the
prospectus). For a free copy of either document, contact Fidelity
Distributors Corporation (FDC), 82 Devonshire Street, Boston, MA
02109, or your investment professional.
LIKE ALL MUTUAL FUNDS, THESE SECURITIES HAVE
NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, NOR
HAS THE SECURITIES AND EXCHANGE
COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
ASCFI-PRO-0998
706781
MUTUAL FUND SHARES ARE NOT DEPOSITS OR
OBLIGATIONS OF, OR GUARANTEED BY, ANY
DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY
THE FDIC, FEDERAL RESERVE BOARD OR ANY OTHER
AGENCY, AND ARE SUBJECT TO INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
Fund 298 - Institutional Class
A fund of Fidelity Advisor Series I
PROSPECTUS
SEPTEMBER 6, 1998(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON,
MA 02109
CONTENTS
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KEY FACTS 17 WHO MAY WANT TO INVEST
18 EXPENSES INSTITUTIONAL CLASS'S YEARLY OPERATING EXPENSES.
18 PERFORMANCE
THE FUND IN DETAIL 19 CHARTER HOW THE FUND IS ORGANIZED.
19 INVESTMENT PRINCIPLES AND RISKS THE FUND'S OVERALL APPROACH TO
INVESTING.
21 BREAKDOWN OF EXPENSES HOW OPERATING COSTS ARE CALCULATED
AND WHAT THEY INCLUDE.
YOUR ACCOUNT 21 TYPES OF ACCOUNTS DIFFERENT WAYS TO SET UP YOUR ACCOUNT,
INCLUDING TAX-ADVANTAGED RETIREMENT PLANS.
22 HOW TO BUY SHARES OPENING AN ACCOUNT AND MAKING ADDITIONAL
INVESTMENTS.
24 HOW TO SELL SHARES TAKING MONEY OUT AND CLOSING YOUR ACCOUNT.
26 INVESTOR SERVICES SERVICES TO HELP YOU MANAGE YOUR ACCOUNT.
SHAREHOLDER AND ACCOUNT POLICIES 26 DIVIDENDS, CAPITAL GAINS, AND TAXES
27 TRANSACTION DETAILS SHARE PRICE CALCULATIONS AND THE TIMING OF
PURCHASES AND REDEMPTIONS.
28 EXCHANGE RESTRICTIONS
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KEY FACTS
WHO MAY WANT TO INVEST
Institutional Class shares are offered to:
1. Broker-dealer managed account programs that (i) charge an
asset-based fee and (ii) will have at least $1 million invested in the
Institutional Class of the Advisor funds. In addition, employee
benefit plans must have at least $50 million in plan assets;
2. Registered investment advisor managed account programs, provided
the registered investment advisor is not part of an organization
primarily engaged in the brokerage business, and the program (i)
charges an asset-based fee and (ii) will have at least $1 million
invested in the Institutional Class of the Advisor funds. In addition,
non-employee benefit plan accounts in the program must be managed on a
discretionary basis;
3. Trust institution and bank trust department managed account
programs that (i) charge an asset-based fee and (ii) will have at
least $1 million invested in the Institutional Class of the Advisor
funds. Accounts managed by third parties are not eligible to purchase
Institutional Class shares;
4. Insurance company separate accounts that will have at least $1
million invested in the Institutional Class of the Advisor funds; and
5. Fidelity Trustees and employees.
For purchases made by managed account programs or insurance company
separate accounts, FDC reserves the right to waive the requirement
that $1 million be invested in the Institutional Class of the Advisor
funds. Employee benefit plan investors must meet additional
requirements specified in the fund's SAI.
The fund may be appropriate for investors who are willing to ride
out stock market fluctuations in pursuit of potentially high long-term
returns. The fund is designed for aggressive investors who believe
small capitalization stocks offer the potential for growth. A
company's market capitalization is the total market value of its
outstanding common stock.
The value of the fund's investments varies from day to day, generally
reflecting changes in market conditions, interest rates, and other
company, political, and economic news both here and abroad. In the
short term, stock prices can fluctuate dramatically in response to
these factors. The securities of small, less well-known companies may
be more volatile than those of larger companies. Over time, however,
stocks have shown greater growth potential than other types of
securities. Investments in foreign securities may involve risks in
addition to those of U.S. investments, including increased political
and economic risk, as well as exposure to currency fluctuations.
The fund is not in itself a balanced investment plan. You should
consider your investment objective and tolerance for risk when making
an investment decision. When you sell your fund shares, they may be
worth more or less than what you paid for them.
The fund is composed of multiple classes of shares. All classes of the
fund have a common investment objective and investment portfolio.
Class A and Class T shares have a front-end sales charge and pay a
distribution fee. Class A and Class T shares may be subject to a
contingent deferred sales charge (CDSC). Class B and Class C shares do
not have a front-end sales charge, but do have a CDSC, and pay a
distribution fee and a shareholder service fee. The performance of one
class of shares of a fund may be different from the performance of
another class of shares of the same fund because of different sales
charges and class expenses. For example, because Institutional Class
shares have no sales charge, and do not pay a distribution fee or a
shareholder service fee, Institutional Class shares are expected to
have a higher total return than Class A, Class T, Class B, or Class C
shares.
You may obtain more information about Class A, Class T, Class B and
Class C shares, which are not offered through this pro spectus, by
calling 1-800-522-7297 if you are investing through a
broke r-dealer or insurance representative, or 1-800-843-3001 if
y ou are investing through a bank representative, or from your
investment professional.
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy
or sell Institutional Class shares of the fund. In addition, you may
be charged an annual account maintenance fee if your account balance
falls below $2,500. See "Transaction Details," page , for an
explanation of how and when these charges apply.
SALES CHARGE ON PURCHASES AND REINVESTED DISTRIBUTIONS NONE
DEFERRED SALES CHARGE ON REDEMPTIONS NONE
ANNUAL ACCOUNT MAINTENANCE FEE (FOR ACCOUNTS UNDER $2,500) $12.00
ANNUAL OPERATING EXPENSES are paid out of the fund's assets. The fund
pays a management fee to Fidelity Management & Research Company (FMR).
It also incurs other expenses for services such as maintaining
shareholder records and furnishing shareholder statements and
financial reports.
The class's expenses are factored into its share price or dividends
and are not charged directly to shareholder accounts (see "Breakdown
of Expenses" on page ).
The following figures are based on estimated expenses of the
Institutional Class of the fund and are calculated as a percentage of
average net assets of the Institutional Class of the fund.
INSTITUTIONAL
CLASS
MANAGEMENT FEES 0.74%
12B-1 FEE (DISTRIBUTION FEE) NONE
OTHER EXPENSES 0.55%
TOTAL OPERATING EXPENSES 1.29%
EXPENSE TABLE EXAMPLE: You would pay the following amount in total
expenses on a $1,000 investment in Institutional Class shares of the
fund, assuming a 5% annual return and full redemption at the end of
each time period. Total expenses shown below include any shareholder
transaction expenses and Institutional Class's annual operating
expenses.
SMALL CAP
1 YEAR 3 YEARS
INSTITUTIONAL CLASS $ 13 $ 41
THESE EXAMPLES ILLUSTRATE THE EFFECT OF EXPENSES, BUT ARE NOT MEANT TO
SUGGEST ACTUAL OR EXPECTED EXPENSES OR RETURNS, ALL OF WHICH MAY VARY.
Effective September 6, 1998, FMR has voluntarily agreed to reimburse
Institutional Class to the extent that total operating expenses
(excluding interest, taxes, brokerage commissions and extraordinary
expenses), as a percentage of its average net assets, exceed 1.50%.
PERFORMANCE
Mutual fund performance is commonly measured as TOTAL RETURN.
Performance history will be available for the fund after the fund has
been in operation for six months.
EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment over a given
period, assuming reinvestment of any dividends and capital gains. A
CUMULATIVE TOTAL RETURN reflects actual performance over a stated
period of time. An AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate
of return that, if achieved annually, would have produced the same
cumulative total return if performance had been constant over the
entire period. Average annual total returns smooth out variations in
performance; they are not the same as actual year-by-year results.
Average annual total returns covering periods of less than one year
assume that performance will remain constant for the rest of the year.
RUSSELL 2000 INDEX is an unmanaged index of 2,000 small company
stocks.
Unlike the class's returns, the total returns of the comparative index
do not include the effect of any brokerage commissions, transaction
fees, or other costs of investing.
Other illustrations of fund performance may show moving averages over
specified periods.
The fund's recent strategies, performance, and holdings are detailed
twice a year in financial reports, which are sent to all shareholders.
THE FUND IN DETAIL
CHARTER
ADVISOR SMALL CAP IS A MUTUAL FUND: an investment that pools
shareholders' money and invests it toward a specified goal. The fund
is a diversified fund of Fidelity Advisor Series I, an open-end
management investment company organized as a Massachusetts business
trust on June 24, 1983.
THE FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet periodically throughout the year to oversee the
fund's activities, review contractual arrangements with companies that
provide services to the fund, and review the fund's performance. The
trustees serve as trustees for other Fidelity funds. The majority of
trustees are not otherwise affiliated with Fidelity.
THE FUND MAY HOLD SPECIAL SHAREHOLDER MEETINGS AND MAIL PROXY
MATERIALS. These meetings may be called to elect or remove trustees,
change fundamental policies, approve a management contract, or for
other purposes. Shareholders not attending these meetings are
encouraged to vote by proxy. The transfer agent will mail proxy
materials in advance, including a voting card and information about
the proposals to be voted on. The number of votes you are entitled to
is based upon the dollar value of your investment.
Separate votes are taken by each class of shares, fund, or trust, if a
matter affects just that class of shares, fund, or trust,
respectively.
FMR AND ITS AFFILIATES
Fidelity Investments(registered trademark) is one of the largest
investment management organizations in the United States and has its
principal business address at 82 Devonshire Street, Boston,
Massachusetts 02109. It includes a number of different subsidiaries
and divisions which provide a variety of financial services and
products. The fund employs various Fidelity companies to perform
activities required for its operation.
The fund is managed by FMR, which chooses the fund's investments and
handles its business affairs. Affiliates assist FMR with foreign
investments:
(small solid bullet) Fidelity Management & Research (U.K.)Inc.
(FMR U.K.), i n London, England, serves as a sub-adviser for the
fund .
(small solid bullet) Fidelity Management & Research Far East Inc. (FMR
Fa r East), in Tokyo, Japan, serves as a sub-adviser for the
fund .
As of July 31 , 1998 FMR advised funds having approximately
38 million shareholder accounts with a total value of more than
$ 611 billion.
Harry Lange is manager of Advisor Small Cap, which he has managed
since inception. He also manages another Fidelity fund. Since joining
Fidelity in 1987, Mr. Lange has worked as an analyst, manager and
director of research.
Fidelity investment personnel may invest in securities for their own
accounts pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
Fidelity Distributors Corporation (FDC) distributes and markets
Fidelity's funds and services.
Fidelity Investments Institutional Operations Company (FIIOC) performs
transfer agent servicing functions for Institutional Class of the
fund.
FMR Corp. is the ultimate parent company of FMR, FMR U.K., and FMR Far
East. Members of the Edward C. Johnson 3d family are the predominant
owners of a class of shares of common stock representing approximately
49% of the voting power of FMR Corp. Under the Investment Company Act
of 1940 (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, the Johnson family may be deemed
under the 1940 Act to form a controlling group with respect to FMR
Corp.
FMR may use its broker-dealer affiliates and other firms that sell
fund shares to carry out the fund's transactions, provided that the
fund receives brokerage services and commission rates comparable to
those of other broker-dealers.
INVESTMENT PRINCIPLES AND RISKS
THE FUND seeks long-term growth of capital by investing primarily in
equity securities of companies with small market capitalizations. FMR
normally invests at least 65% of the fund's total assets in these
securities. The fund has the flexibility, however, to invest in other
market capitalizations and security types.
Small market capitalization companies are those whose market
capitalization is similar to the market capitalization of companies in
the Russell 2000 at the time of the fund's investment. Companies whose
capitalization no longer meets this definition after purchase continue
to be considered small-capitalized for purposes of the 65% policy. As
of June 30 , 199 8 , the Russell 2000 included companies
with capitalizations between $ 110 million and $ 2.5
billion. The size of companies in the Russell 2000 changes with market
conditions and the composition of the index.
Investing in small capitalization stocks may involve greater risk than
investing in medium and large capitalization stocks, since they can be
subject to more abrupt or erratic movements. Small capitalization
companies may have more limited product lines, markets, or financial
resources.
The value of the fund's domestic and foreign investments varies in
response to many factors. Stock values fluctuate in response to the
activities of individual companies and general market and economic
conditions. Investments in foreign securities may involve risks in
addition to those of U.S. investments, including increased political
and economic risk, as well as exposure to currency fluctuations.
FMR may use various investment techniques to hedge a portion of the
fund's risks, but there is no guarantee that these strategies will
work as FMR intends. As a mutual fund, the fund seeks to spread
investment risk by diversifying its holdings among many companies and
industries. When you sell your shares of the fund, they may be worth
more or less than what you paid for them.
FMR normally invests the fund's assets according to its investment
strategy. The fund also reserves the right to invest without
limitation in preferred stocks and investment-grade debt instruments
for temporary, defensive purposes.
SECURITIES AND INVESTMENT PRACTICES
The following pages contain more detailed information about types of
instruments in which the fund may invest, strategies FMR may employ in
pursuit of the fund's investment objective, and a summary of related
risks. Any restrictions listed supplement those discussed earlier in
this section. A complete listing of the fund's limitations and more
detailed information about the fund's investments are contained in the
fund's SAI. Policies and limitations are considered at the time of
purchase; the sale of instruments is not required in the event of a
subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these
techniques unless it believes that they are consistent with the fund's
investment objective and policies and that doing so will help the fund
achieve its goal. Fund holdings and recent investment strategies are
detailed in the fund's financial reports, which are sent to
shareholders twice a year. For a free SAI or financial report, call
your investment professional.
EQUITY SECURITIES may include common stocks, preferred stocks,
convertible securities, and warrants. Common stocks, the most familiar
type, represent an equity (ownership) interest in a corporation.
Although equity securities have a history of long-term growth in
value, their prices fluctuate based on changes in a company's
financial condition and on overall market and economic conditions.
Smaller companies are especially sensitive to these factors.
RESTRICTIONS: With respect to 75% of its total assets, the fund may
not invest in more than 10% of the outstanding voting securities of a
single issuer. This limitation does not apply to securities of other
investment companies.
DEBT SECURITIES. Bonds and other debt instruments are used by issuers
to borrow money from investors. The issuer generally pays the investor
a fixed, variable, or floating rate of interest, and must repay the
amount borrowed at maturity. Some debt securities, such as zero coupon
bonds, do not pay current interest, but are sold at a discount from
their face values.
Debt securities have varying levels of sensitivity to changes in
interest rates and varying degrees of credit quality. In general, bond
prices rise when interest rates fall, and fall when interest rates
rise. Longer-term bonds and zero coupon bonds are generally more
sensitive to interest rate changes.
DEBT RATINGS
MOODY'S
INVESTORS SERVICE STANDARD & POOR'S
Rating Rating
INVESTMENT GRADE
Highest quality Aaa AAA
High quality Aa AA
Upper-medium grade A A
Medium grade Baa BBB
LOWER QUALITY
Moderately speculative Ba BB
Speculative B B
Highly speculative Caa CCC
Poor quality Ca CC
Lowest quality, no interest C C
In default, in arrears -- D
REFER TO THE FUND'S SAI FOR A MORE COMPLETE DISCUSSION OF THESE
RATINGS.
THE FUND DOES NOT NECESSARILY RELY ON THE RATINGS OF MOODY'S OR S&P TO
DETERMINE COMPLIANCE WITH ITS DEBT QUALITY POLICY.
Lower-quality debt securities are considered to have speculative
characteristics, and involve greater risk of default or price changes
due to changes in the issuer's creditworthiness, or they may already
be in default. The market prices of these securities may fluctuate
more than higher-quality securities and may decline significantly in
periods of general or regional economic difficulty.
RESTRICTIONS: Purchase of a debt security is consistent with the
fund's debt quality policy if it is rated at or above the stated level
by Moody's Investors Service or rated in the equivalent categories by
Standard & Poor's, or is unrated but judged to be of equivalent
quality by FMR. The fund currently intends to limit its investments in
lower than Baa-quality debt securities (sometimes called "junk bonds")
to less than 35% of its assets.
EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies,
and securities issued by U.S. entities with substantial foreign
operations may involve additional risks and considerations. These
include risks relating to political, economic, or regulatory
conditions in foreign countries; fluctuations in foreign currencies;
withholding or other taxes; trading, settlement, custodial, and other
operational risks; and the potentially less stringent investor
protection and disclosure standards of foreign markets. Additionally,
governmental issuers of foreign debt securities may be unwilling to
pay interest and repay principal when due and may require that the
conditions for payment be renegotiated. All of these factors can make
foreign investments, especially those in emerging markets, more
volatile and potentially less liquid than U.S. investments.
REPURCHASE AGREEMENTS. In a repurchase agreement, the fund buys a
security at one price and simultaneously agrees to sell it back at a
higher price. Delays or losses could result if the other party to the
agreement defaults or becomes insolvent.
ADJUSTING INVESTMENT EXPOSURE. The fund can use various techniques to
increase or decrease its exposure to changing security prices,
interest rates, currency exchange rates, commodity prices, or other
factors that affect security values. These techniques may involve
derivative transactions such as buying and selling options and futures
contracts, entering into currency exchange contracts or swap
agreements, and purchasing indexed securities.
FMR can use these practices to adjust the risk and return
characteristics of the fund's portfolio of investments. If FMR judges
market conditions incorrectly or employs a strategy that does not
correlate well with the fund's investments, these techniques could
result in a loss, regardless of whether the intent was to reduce risk
or increase return. These techniques may increase the volatility of
the fund and may involve a small investment of cash relative to the
magnitude of the risk assumed. In addition, these techniques could
result in a loss if the counterparty to the transaction does not
perform as promised.
DIRECT DEBT. Loans and other direct debt instruments are interests in
amounts owed to another party by a company, government, or other
borrower. They have additional risks beyond conventional debt
securities because they may entail less legal protection for the fund,
or there may be a requirement that the fund supply additional cash to
a borrower on demand.
ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined
by FMR, under the supervision of the Board of Trustees, to be
illiquid, which means that they may be difficult to sell promptly at
an acceptable price. The sale of some illiquid securities, and some
other securities, may be subject to legal restrictions. Difficulty in
selling securities may result in a loss or may be costly to a fund.
RESTRICTIONS: The fund may not invest more than 10% of its assets in
illiquid securities.
OTHER INSTRUMENTS may include real estate-related instruments.
CASH MANAGEMENT. The fund may invest in money market securities, in
repurchase agreements, and in a money market fund available only to
funds and accounts managed by FMR or its affiliates, whose goal is to
seek a high level of current income while maintaining a stable $1.00
share price. A major change in interest rates or a default on the
money market fund's investments could cause its share price to change.
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce
the risks of investing. This may include limiting the amount of money
invested in any one issuer or, on a broader scale, in any one
industry. Economic, business, or political changes can affect all
securities of a similar type.
RESTRICTIONS: With respect to 75% of its total assets, the fund may
not invest more than 5% in the securities of any one issuer. This
limitation does not apply to U.S. Government securities or securities
of other investment companies.
The fund may not invest more than 25% of its total assets in any one
industry. This limitation does not apply to U.S. Government
securities.
BORROWING. The fund may borrow from banks or from other funds advised
by FMR or its affiliates, or through reverse repurchase agreements. If
the fund borrows money, its share price may be subject to greater
fluctuation until the borrowing is paid off. If the fund makes
additional investments while borrowings are outstanding, this may be
considered a form of leverage.
RESTRICTIONS: The fund may borrow only for temporary or emergency
purposes, but not in an amount exceeding 331/3% of its total assets.
LENDING securities to broker-dealers and institutions, including
Fidelity Brokerage Services, Inc. (FBSI), an affiliate of FMR, is a
means of earning income. This practice could result in a loss or a
delay in recovering the fund's securities. A fund may also lend money
to other funds advised by FMR or its affiliates.
RESTRICTIONS: Loans, in the aggregate, may not exceed 331/3% of the
fund's total assets.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS. Some of the policies
and restrictions discussed on the preceding pages are fundamental,
that is, subject to change only by shareholder approval. The following
paragraphs restate all those that are fundamental. All policies stated
throughout this prospectus, other than those identified in the
following paragraphs, can be changed without shareholder approval.
The fund seeks long-term growth of capital.
With respect to 75% of its total assets, the fund may not invest more
than 5% in the securities of any one issuer and may not invest in more
than 10% of the outstanding voting securities of a single issuer.
These limitations do not apply to U.S. Government securities or to
securities of other investment companies.
The fund may not invest more than 25% of its total assets in any one
industry. This limitation does not apply to U.S. Government
securities.
The fund may borrow only for temporary or emergency purposes, but not
in an amount exceeding 331/3% of its total assets.
Loans, in the aggregate, may not exceed 331/3% of the fund's total
assets.
BREAKDOWN OF EXPENSES
Like all mutual funds, the fund pays fees related to its daily
operations. Expenses paid out of Institutional Class's assets are
reflected in its share price or dividends; they are neither billed
directly to shareholders nor deducted from shareholder accounts.
The fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. FMR in turn pays fees to affiliates who provide
assistance with these services. The fund also pays OTHER EXPENSES,
which are explained at right .
FMR may, from time to time, agree to reimburse the fund for management
fees and other expenses above a specified limit. FMR retains the
ability to be repaid by the fund if expenses fall below the specified
limit prior to the end of the fiscal year. Reimbursement arrangements,
which may be terminated at any time without notice, can decrease the
class's expenses and boost its performance.
MANAGEMENT FEE
The management fee is calculated and paid to FMR every month. The fee
is calculated by adding a group fee rate to an individual fund fee
rate, dividing by twelve, and multiplying the result by the
fund's average net assets throughout the month .
The group fee rate is based on the average net assets of all the
mutual funds advised by FMR. This rate cannot rise above 0.52%, and it
drops as total assets under management increase.
For July 1998, the group fee rate was 0.2875 %. The
individual fund fee rate is 0.45%.
FMR HAS SUB-ADVISORY AGREEMENTS with FMR U.K. and FMR Far East. These
sub-advisers provide FMR with investment research and advice on
issuers based outside the United States. Under the sub-advisory
agreements, FMR pays FMR U.K. and FMR Far East fees equal to 110% and
105%, respectively, of the costs of providing these services.
The sub-advisers may also provide investment management services. In
return, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of its
management fee rate with respect to the fund's investments that the
sub-adviser manages on a discretionary basis.
OTHER EXPENSES
While the management fee is a significant component of the fund's
annual operating costs, the fund has other expenses as well.
FIIOC performs transfer agency, dividend disbursing and shareholder
servicing functions for Institutional Class of the fund. Fidelity
Service Company, Inc. (FSC) calculates the net asset value per share
(NAV) and dividends for Institutional Class, maintains the fund's
general accounting records, and administers the fund's securities
lending program.
The fund also pays other expenses, such as legal, audit, and custodian
fees; in some instances, proxy solicitation costs; and the
compensation of trustees who are not affiliated with Fidelity. A
broker-dealer may use a portion of the commissions paid by the fund to
reduce the fund's custodian or transfer agent fees.
Institutional Class has adopted a DISTRIBUTION AND SERVICE PLAN. This
plan recognizes that FMR may use its management fee revenues, as well
as its past profits or its resources from any other source, to pay FDC
for expenses incurred in connection with the distribution of
Institutional Class shares. FMR, directly or through FDC, may make
payments to third parties, such as banks or broker-dealers, that
engage in the sale of, or provide shareholder support services for,
Institutional Class shares. Currently, the Board of Trustees has
authorized such payments.
The fund's portfolio turnover rate will vary from year to year. High
turnover rates increase transaction costs and may increase taxable
capital gains. FMR considers these effects when evaluating the
anticipated benefits of short-term investing.
YOUR ACCOUNT
TYPES OF ACCOUNTS
When you invest through an investment professional, your investment
professional, including a broker-dealer or financial institution, may
charge you a transaction fee with respect to the purchase and sale of
fund shares. Read your investment professional's program materials in
conjunction with this prospectus for additional service features or
fees that may apply. Certain features of the fund, such as minimum
initial or subsequent investment amounts, may be modified.
The different ways to set up (register) your account with Fidelity are
listed at right.
The account guidelines that follow may not apply to certain retirement
accounts. If you are investing through a retirement account or if your
employer offers the fund through a retirement program, you may be
subject to additional fees. For more information, please refer to your
program materials, contact your employer, or call your retirement
benefits number or your investment professional directly, as
appropriate.
WAYS TO SET UP YOUR ACCOUNT
INDIVIDUAL OR JOINT TENANT
FOR YOUR GENERAL INVESTMENT NEEDS
Individual accounts are owned by one person. Joint accounts can have
two or more owners (tenants).
RETIREMENT
FOR TAX-ADVANTAGED RETIREMENT SAVINGS
Retirement plans provide individuals with tax-advantaged ways to save
for retirement, either with tax-deductible contributions or tax-free
growth. Retirement accounts require special applications and typically
have lower minimums.
(solid bullet) TRADITIONAL INDIVIDUAL RETIREMENT ACCOUNTS (IRAS) allow
individuals under age 70 1/2 (checkmark)(solid club) with compensation
to contribute up to $2,000 per tax year. Married couples can
contribute up to $4,000 per tax year, provided no more than $2,000 is
contributed on behalf of either spouse. (These limits are aggregate
for Traditional and Roth IRAs.) Contributions may be tax-deductible,
subject to certain income limits.
(solid bullet) ROTH IRAS allow individuals to make non-deductible
contributions of up to $2,000 per tax year. Married couples can
contribute up to $4,000 per tax year, provided no more than $2,000 is
contributed on behalf of either spouse. (These limits are aggregate
for Traditional and Roth IRAs.) Eligibility is subject to certain
income limits. Qualified distributions are tax-free.
(solid bullet) ROTH CONVERSION IRAS allow individuals with assets held
in a Traditional IRA or Rollover IRA to convert those assets to a Roth
Conversion IRA. Eligibility is subject to certain income limits.
Qualified distributions are tax-free.
(solid bullet) ROLLOVER IRAS help retain special tax advantages for
certain eligible rollover distributions from employer-sponsored
retirement plans.
(solid bullet) 401(K) PLANS, and certain other 401(a)-qualified plans,
are employer-sponsored retirement plans that allow employer
contributions and may allow employee after-tax contributions. In
addition, 401(k) plans allow employee pre-tax (tax-deferred)
contributions. Contributions to these plans may be tax-deductible to
the employer.
(solid bullet) KEOGH PLANS are generally profit sharing or money
purchase pension plans that allow self-employed individuals or small
business owners to make tax-deductible contributions for themselves
and any eligible employees.
(solid bullet) SIMPLE IRAS provide small business owners and those
with self-employment income (and their eligible employees) with many
of the advantages of a 401(k) plan, but with fewer administrative
requirements.
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS) provide
small business owners or those with self-employment income (and their
eligible employees) with many of the same advantages as a Keogh, but
with fewer administrative requirements.
(solid bullet) SALARY REDUCTION SEP-IRAS (SARSEPS) allow employees of
businesses with 25 or fewer employees to contribute a percentage of
their wages on a tax-deferred basis. These plans must have been
established by the employer prior to January 1, 1997.
GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA)
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS
These custodial accounts provide a way to give money to a child and
obtain tax benefits. An individual can give up to $10,000 a year per
child without paying federal gift tax. Depending on state laws, you
can set up a custodial account under the Uniform Gifts to Minors Act
(UGMA) or the Uniform Transfers to Minors Act (UTMA). Contact your
investment professional.
TRUST
FOR MONEY BEING INVESTED BY A TRUST
The trust must be established before an account can be opened.
BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR
OTHER GROUPS
Contact your investment professional.
HOW TO BUY SHARES
THE PRICE TO BUY ONE SHARE of Institutional Class is the class's net
asset value per share (NAV). Institutional Class shares are sold
without a sales charge.
Your shares will be purchased at the next NAV calculated after your
order is received in proper form. Institutional Class's NAV is
normally calculated each business day at 4:00 p.m. Eastern time.
Short-term or excessive trading into and out of the fund may harm
fund performance by disrupting portfolio management strategies and by
increasing fund 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.
It is the responsibility of your investment professional to transmit
your order to buy shares to the transfer agent before the close of
business on the day you place your order.
Fidelity must receive payment within three business days after an
order for shares is placed; otherwise your purchase order may be
canceled and you could be held liable for resulting fees and/or
losses.
Share certificates are not available for Institutional Class shares.
IF YOU ARE NEW TO THE FIDELITY ADVISOR FUNDS, complete and sign an
account application and mail it along with your check. You may also
open your account by wire as described on page . If there is no
account application accompanying this prospectus, if your are
investing through a broker-dealer or insurance representative, call
1-800-522-7297; if you are investing through a bank representative,
call 1-800-843-3001; or call your investment professional.
If you are investing through a tax-advantaged retirement plan, such as
an IRA, for the first time, you will need a special application.
Contact your investment professional for more information and a
retirement account application.
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY ADVISOR FUND, you
can:
(small solid bullet) Mail an account application with a check,
(small solid bullet) Place an order and wire money into your account,
or
(small solid bullet) Open your account by exchanging from the same
class of another Fidelity Advisor fund or from another Fidelity fund,
or
(solid bullet) Contact your investment professional.
MINIMUM INVESTMENTS
TO OPEN AN ACCOUNT $2,500
For certain Fidelity Advisor retirement accounts* $500
Through regular investment plans** $1,000
TO ADD TO AN ACCOUNT $250
For certain Fidelity Advisor retirement accounts* $100
Through regular investment plans** $100
MINIMUM BALANCE $1,000
For certain Fidelity Advisor retirement accounts* None
* THESE LOWER MINIMUMS APPLY TO FIDELITY ADVISOR TRADITIONAL IRA, ROTH
IRA, ROTH CONVERSION IRA, ROLLOVER IRA, SEP-IRA, AND KEOGH ACCOUNTS.
** AN ACCOUNT MAY BE OPENED WITH A MINIMUM OF $1,000, PROVIDED THAT A
REGULAR INVESTMENT PLAN IS ESTABLISHED AT THE TIME THE ACCOUNT IS
OPENED. FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE
REFER TO "INVESTOR SERVICES," PAGE .
There is no minimum account balance or initial or subsequent
investment minimum for certain Fidelity retirement accounts funded
through salary deduction, or accounts opened with the proceeds of
distributions from such retirement accounts. Refer to the program
materials for details. In addition, the fund reserves the right to
waive or lower investment minimums in other circumstances.
For further information on opening an account, please consult your
investment professional or refer to the account application.
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TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT
PHONE
(PHONE_GRAPHIC)
(SMALL SOLID BULLET) EXCHANGE FROM THE SAME CLASS OF
ANOTHER FIDELITY (SMALL SOLID BULLET) EXCHANGE FROM THE SAME CLASS OF ANOTHER
FIDELITY ADVISOR FUND
IF YOU ARE
INVESTING THROUGH A ADVISOR FUND OR FROM ANOTHER
FIDELITY FUND ACCOUNT WITH OR FROM ANOTHER FIDELITY FUND ACCOUNT
WITH THE SAME
BROKER-DEALER OR
INSURANCE REPRESENTATIVE, THE SAME REGISTRATION, INCLUDING
NAME, ADDRESS, AND REGISTRATION, INCLUDING NAME, ADDRESS,
AND TAXPAYER ID NUMBER.
CALL 1-800-522-7297;
IF YOU ARE INVESTING TAXPAYER ID NUMBER.
THROUGH BANK
REPRESENTATIVE, CALL
1-800-843-3001 OR CALL
YOUR INVESTMENT
PROFESSIONAL.
MAIL
(MAIL_GRAPHIC)
(SMALL SOLID BULLET) COMPLETE AND SIGN THE ACCOUNT
APPLICATION. MAKE YOUR (SMALL SOLID BULLET) MAKE YOUR CHECK PAYABLE TO THE COMPLETE
NAME OF THE FUND
CHECK PAYABLE TO THE COMPLETE
NAME OF THE FUND AND AND NOTE THE APPLICABLE CLASS. INDICATE
YOUR FUND ACCOUNT
NOTE THE APPLICABLE CLASS.
MAIL TO THE ADDRESS INDICATED NUMBER ON YOUR CHECK AND MAIL TO THE
ADDRESS PRINTED ON YOUR
ON THE APPLICATION. ACCOUNT STATEMENT.
(SMALL SOLID BULLET) EXCHANGE BY MAIL: IF YOU ARE INVESTING
THROUGH A BROKER-DEALER OR INSURANCE
REPRESENTATIVE, CALL 1-800-522-7297; IF
YOU ARE INVESTING THROUGH A BANK
REPRESENTATIVE, CALL 1-800-843-3001;
OR CALL YOUR INVESTMENT PROFESSIONAL
FOR INSTRUCTIONS.
IN PERSON
(HAND_GRAPHIC)
(SMALL SOLID BULLET) BRING YOUR ACCOUNT APPLICATION
AND CHECK TO YOUR (SMALL SOLID BULLET) BRING YOUR CHECK TO YOUR INVESTMENT
PROFESSIONAL.
INVESTMENT PROFESSIONAL.
WIRE
(WIRE_GRAPHIC)
(SMALL SOLID BULLET) IF YOU ARE INVESTING THROUGH A
BROKER-DEALER OR INSURANCE (SMALL SOLID BULLET) NOT AVAILABLE FOR RETIREMENT ACCOUNTS.
REPRESENTATIVE, CALL
1-800-522-7297; IF YOU ARE (SMALL SOLID BULLET) WIRE TO:
INVESTING THROUGH A BANK
REPRESENTATIVE, CALL BANKER'S TRUST CO.
1-800-843-3001 TO SET UP YOUR
ACCOUNT AND ARRANGE A ROUTING # 021001033
WIRE TRANSACTION. NOT AVAILABLE
FOR RETIREMENT ACCOUNTS. FIDELITY DART DEPOSITORY
(SMALL SOLID BULLET) WIRE TO: ACCOUNT # 00159759
BANKER'S TRUST CO. FBO: (ACCOUNT NAME)
ROUTING # 021001033 (ACCOUNT NUMBER)
FIDELITY DART DEPOSITORY SPECIFY THE COMPLETE NAME OF THE
FUND OF YOUR CHOICE, NOTE THE
ACCOUNT #00159759 APPLICABLE CLASS AND INCLUDE YOUR
ACCOUNT NUMBER AND YOUR
FBO: (ACCOUNT NAME) NAME.
(ACCOUNT NUMBER)
SPECIFY THE COMPLETE NAME OF THE
FUND OF YOUR CHOICE, NOTE THE
APPLICABLE CLASS AND INCLUDE YOUR
NEW ACCOUNT NUMBER AND YOUR NAME.
AUTOMATICALLY
(AUTOMATIC_GRAPHIC)
(SMALL SOLID BULLET) NOT AVAILABLE. (SMALL SOLID BULLET) USE FIDELITY ADVISOR SYSTEMATIC
INVESTMENT PROGRAM. SIGN UP
FOR THIS SERVICE WHEN OPENING
YOUR ACCOUNT, OR CALL YOUR INVEST-
MENT PROFESSIONAL TO BEGIN THE PROGRAM.
</TABLE>
HOW TO SELL SHARES
You can arrange to take money out of your fund account at any time by
selling (redeeming) some or all of your shares.
THE PRICE TO SELL ONE SHARE of Institutional Class is the Class's NAV.
Your shares will be sold at the next NAV calculated after your order
is received in proper form. The class's NAV is normally calculated
each business day at 4:00 p.m. Eastern time.
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.
TO SELL SHARES IN A NON-RETIREMENT ACCOUNT, you may use any of the
methods described on these two pages.
TO SELL SHARES IN A FIDELITY ADVISOR RETIREMENT ACCOUNT, your request
must be made in writing, except for exchanges to shares of the same
class of another.
Fidelity Advisor fund or shares of other Fidelity funds, which can be
requested by phone or in writing.
IF YOU ARE SELLING SOME BUT NOT ALL OF YOUR SHARES, leave at least
$1,000 worth of shares in the account to keep it open (account minimum
balances do not apply to retirement and Fidelity Defined Trust
accounts).
TO SELL SHARES BY BANK WIRE, you will need to sign up for this service
in advance.
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 redeem 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,
(small solid bullet) The redemption proceeds are being transferred to
a Fidelity Advisor account with a different registration,
(small solid bullet) You wish to set up the bank wire feature, or
(small solid bullet) You wish to have redemption proceeds wired to a
non-predesignated bank account.
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.
SELLING SHARES IN WRITING
Write a "letter of instruction" with:
(small solid bullet) Your name,
(small solid bullet) The fund's name,
(small solid bullet) The applicable class name,
(small solid bullet) Your fund account number,
(small solid bullet) The dollar amount or number of shares to be
redeemed, and
(solid bullet) Any other applicable requirements listed in the table
on page .
Deliver your letter to your investment professional, or mail it to the
following address:
Fidelity Investments
P.O. Box 770002
Cincinnati, OH 45277-0081
Unless otherwise instructed, Fidelity will send a check to the record
address.
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ACCOUNT TYPE SPECIAL REQUIREMENTS
PHONE
(PHONE_GRAPHIC) ALL ACCOUNT TYPES EXCEPT RETIREMENT (SMALL SOLID BULLET) MAXIMUM CHECK REQUEST: $100,000.
IF YOU ARE INVESTING
THROUGH A ALL ACCOUNT TYPES (SMALL SOLID BULLET) YOU MAY EXCHANGE TO THE SAME
CLASS OF OTHER FIDELITY ADVISOR
BROKER-DEALER OR INSURANCE
REPRESENTATIVE, FUNDS OR TO OTHER FIDELITY FUNDS
IF BOTH ACCOUNTS ARE REGISTERED
CALL 1-800-522-7297; IF
YOU ARE INVESTING WITH THE SAME NAME(S), ADDRESS,
AND TAXPAYER ID NUMBER.
THROUGH A BANK
REPRESENTATIVE, CALL
1-800-843-3001 OR CALL
YOUR INVESTMENT
PROFESSIONAL.
MAIL
(MAIL_GRAPHIC)
INDIVIDUAL, JOINT TENANT,
SOLE PROPRIETORSHIP, UGMA, UTMA (SMALL SOLID BULLET) THE LETTER OF INSTRUCTION MUST BE
SIGNED BY ALL PERSONS REQUIRED
TO SIGN FOR TRANSACTIONS,
EXACTLY AS THEIR NAMES APPEAR
ON THE ACCOUNT.
RETIREMENT ACCOUNT (SMALL SOLID BULLET) THE ACCOUNT OWNER SHOULD COMPLETE
A RETIREMENT DISTRIBUTION
FORM. IF YOU ARE INVESTING
THROUGH A BROKER-DEALER OR
INSURANCE REPRESENTATIVE,
CALL 1-800-522-7297; IF YOU
ARE INVESTING THROUGH A BANK
REPRESENTATIVE, CALL
1-800-843-3001; OR CALL
YOUR INVESTMENT PROFESSIONAL
TO REQUEST ONE.
TRUST (SMALL SOLID BULLET) THE TRUSTEE MUST SIGN THE LETTER
INDICATING CAPACITY AS TRUSTEE.
IF THE TRUSTEE'S NAME IS NOT
IN THE ACCOUNT REGISTRATION,
PROVIDE A COPY OF THE TRUST
DOCUMENT CERTIFIED WITHIN
THE LAST 60 DAYS.
BUSINESS OR ORGANIZATION (SMALL SOLID BULLET) AT LEAST ONE PERSON AUTHORIZED
BY CORPORATE RESOLUTION TO ACT
ON THE ACCOUNT MUST SIGN THE
LETTER.
EXECUTOR, ADMINISTRATOR,
CONSERVATOR/GUARDIAN (SMALL SOLID BULLET) IF YOU ARE INVESTING THROUGH
A BROKER-DEALER OR INSURANCE
REPRESENTATIVE, CALL
1-800-522-7297; IF YOU ARE
INVESTING THROUGH A BANK
REPRESENTATIVE, CALL
1-800-843-3001; OR CALL YOUR
INVESTMENT PROFESSIONAL FOR
INSTRUCTIONS.
WIRE
(WIRE_GRAPHIC)
ALL ACCOUNT TYPES EXCEPT
RETIREMENT (SMALL SOLID BULLET) YOU MUST SIGN UP FOR THE
WIRE FEATURE BEFORE USING
IT. TO VERIFY THAT IT IS
IN PLACE, IF YOU ARE
INVESTING THROUGH A
BROKER-DEALER OR INSURANCE
REPRESENTATIVE, CALL
1-800-522-7297; IF YOU ARE
INVESTING THROUGH A BANK
REPRESENTATIVE, CALL
1-800-843-3001; OR CALL YOUR
INVESTMENT PROFESSIONAL FOR
INSTRUCTIONS. MINIMUM WIRE: $500.
(SMALL SOLID BULLET) YOUR WIRE REDEMPTION REQUEST
MUST BE RECEIVED IN PROPER
FORM BY THE TRANSFER AGENT
BEFORE 4:00 P.M. EASTERN TIME
FOR MONEY TO BE WIRED ON THE
NEXT BUSINESS DAY.
</TABLE>
INVESTOR SERVICES
Fidelity Advisor funds provide a variety of services to help you
manage your account.
INFORMATION SERVICES
STATEMENTS AND REPORTS that Fidelity sends to you include the
following:
(small solid bullet) Confirmation statements (after every transaction,
except a reinvestment, that affects your account balance or your
account registration)
(small solid bullet) Account statements (quarterly)
(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 your investment professional if you need additional
copies of financial reports and prospectuses.
TRANSACTION SERVICES
EXCHANGE PRIVILEGE. You may sell your Institutional Class shares and
buy Institutional Class shares of other Fidelity Advisor funds or
shares of other Fidelity funds by telephone or in writing.
Note that exchanges out of the fund are limited to four per calendar
year, and that they may have tax consequences for you. For details on
policies and restrictions governing exchanges, including circumstances
under which a shareholder's exchange privilege may be suspended or
revoked, see "Exchange Restrictions," page .
FIDELITY ADVISOR SYSTEMATIC WITHDRAWAL PROGRAM lets you set up
periodic redemptions from your account. Accounts with a value of
$10,000 or more Institutional Class shares are eligible for this
program.
One easy way to pursue your financial goals is to invest money
regularly. Fidelity Advisor funds offer convenient services that let
you transfer money into your fund account, or between fund accounts,
automatically. While regular investment plans 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. Certain
restrictions apply for retirement accounts. Call your investment
professional for more information.
REGULAR INVESTMENT PLANS
FIDELITY ADVISOR SYSTEMATIC INVESTMENT PROGRAM
TO MOVE MONEY FROM YOUR BANK ACCOUNT TO A FIDELITY ADVISOR FUND
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MINIMUM MINIMUM
INITIAL ADDITIONAL FREQUENCY SETTING UP OR CHANGING
$1,000 $100 Monthly, bimonthly,
quarterly, (small solid bullet) For a new account, complete the
appropriate section on the
application.
or semi-annually (small solid bullet) For existing accounts, call your
investment professional for an
application.
(small solid bullet) To change the amount or frequency
of your investment, contact your
investment professional directly
or, if you purchased your shares
through a broker-dealer or
insurance representative, call
1-800-522-7297. If you purchased
your shares through a bank
representative, call 1-800-843-3001.
Call at least 10 business days prior
to your next scheduled investment
date (20 business days if you
purchased your shares through a
bank).
</TABLE>
SHAREHOLDER AND ACCOUNT POLICIES
DIVIDENDS, CAPITAL GAINS, AND TAXES
The fund distributes substantially all of its net investment income
and capital gains to shareholders each year. Normally, dividends are
distributed in December and January. Capital gains are normally
distributed in December and the fund may pay additional capital gains
after the close of the fund's fiscal year.
DISTRIBUTION OPTIONS
When you open an account, specify on your account application how you
want to receive your distributions. Institutional Class offers four
options:
1. REINVESTMENT OPTION. Your dividend and capital gain distributions
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. INCOME-EARNED OPTION. Your capital gain distributions will be
automatically reinvested in additional shares of the same class of the
fund, but you will be sent a check for each dividend distribution.
3. CASH OPTION. You will be sent a check for your dividend and capital
gain distributions.
4. DIRECTED DIVIDENDS(registered trademark) PROGRAM. Your dividend
distributions will be automatically invested in the same class of
shares of another identically registered Fidelity Advisor fund. You
will be sent a check for your capital gain distributions or your
capital gain distributions will be automatically reinvested in
additional shares of the same class of the fund.
If you select distribution option 2, 3 or 4 and the U.S. Postal
Service does not deliver your checks, your election may be converted
to the Reinvestment Option. You will not receive interest on amounts
represented by uncashed distribution checks. To change your
distribution option, call your investment professional directly or, if
you purchased your shares through a broker-dealer or insurance
representative, call 1-800-522-7297. If you purchased your shares
through a bank representative, call 1-800-843-3001.
When Institutional Class deducts a distribution from its NAV, the
reinvestment price is the applicable class's NAV at the close of
business that day. Distribution checks will be mailed within seven
days.
TAXES
As with any investment, you should consider how your investment in the
fund will be taxed. If your account is not a tax-advantaged retirement
account, you should be aware of these tax implications.
TAXES ON DISTRIBUTIONS. Distributions are subject to federal income
tax, and may also be subject to state or local taxes. If you live
outside the United States, your distributions could also be taxed by
the country in which you reside. Your distributions are taxable when
they are paid, whether you take them in cash or reinvest them.
However, distributions declared in December and paid in January are
taxable as if they were paid on December 31.
For federal tax purposes, the fund's income and short-term capital
gains are distributed as dividends and taxed as ordinary income;
capital gain distributions are taxed as long-term capital gains.
Every January, Fidelity will send you and the IRS a statement showing
the tax characterization of distributions paid to you in the previous
year.
TAXES ON TRANSACTIONS. Your redemptions are subject to capital gains
tax. A capital gain or loss is the difference between the cost of your
shares and the price you receive when you sell them.
Whenever you sell shares of the fund, Fidelity will send you a
confirmation statement showing how many shares you sold and at what
price.
You will also receive a consolidated transaction statement at least
quarterly. However, it is up to you or your tax preparer to determine
whether this sale resulted in a capital gain and, if so, the amount of
tax to be paid. BE SURE TO KEEP YOUR REGULAR ACCOUNT STATEMENTS; the
information they contain will be essential in calculating the amount
of your capital gains.
"BUYING A DIVIDEND." If you buy shares when the class has realized but
not yet distributed income or capital gains, you will pay the full
price for the shares and then receive a portion of the price back in
the form of a taxable distribution.
EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on the
fund and its investments, and these taxes generally will reduce the
fund's distributions.
There are tax requirements that all funds must follow in order to
avoid federal taxation. In its effort to adhere to these requirements,
the fund may have to limit its investment activity in some types of
instruments.
TRANSACTION DETAILS
THE FUND IS OPEN FOR BUSINESS each day the New York Stock Exchange
(NYSE) is open. FSC normally calculates Institutional Class's NAV as
of the close of business of the NYSE, normally 4:00 p.m. Eastern time.
A CLASS'S NAV is the value of a single share. The NAV of each class is
computed by adding that class's pro rata share of the value of the
fund's investments, cash, and other assets, subtracting that class's
pro rata share of the value of the fund's liabilities, subtracting the
liabilities allocated to that class, and dividing the result by the
number of shares of that class that are outstanding.
The fund's assets are valued primarily on the basis of market
quotations. Short-term securities with remaining maturities of sixty
days or less for which quotations are not readily available are valued
on the basis of amortized cost. This method minimizes the effect of
changes in a security's market value. Foreign securities are valued on
the basis of quotations from the primary market in which they are
traded, and are translated from the local currency into U.S. dollars
using current exchange rates. In addition, if quotations are not
readily available, or if the values have been materially affected by
events occurring after the closing of a foreign market, assets may be
valued by another method that the Board of Trustees believes
accurately reflects fair value.
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.
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 redeem and
exchange by telephone, call Fidelity for instructions. Additional
documentation may be required from corporations, associations, and
certain fiduciaries.
IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during
periods of unusual market activity), consider placing your order by
mail.
THE FUND RESERVES THE RIGHT to suspend the offering of shares for a
period of time.
WHEN YOU PLACE AN ORDER TO BUY SHARES, your shares will be purchased
at the next NAV calculated after your order is received in proper
form. Note the following:
(small solid bullet) All of your purchases must be made in U.S.
dollars and checks must be drawn on U.S. banks.
(small solid bullet) Fidelity does not accept cash.
(small solid bullet) The fund 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) The fund 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.
AUTOMATED PURCHASE ORDERS. Institutional Class shares can be purchased
or sold through investment professionals utilizing an automated order
placement and settlement system that guarantees payment for orders on
a specified date.
CONFIRMED PURCHASES. Certain financial institutions that meet FDC's
creditworthiness criteria may enter confirmed purchase orders on
behalf of customers by phone, with payment to follow no later than
close of business on the next business day. If payment is not received
by the next business day, the order will be canceled and the financial
institution will be liable for any losses.
TO AVOID THE COLLECTION PERIOD associated with check purchases,
consider buying shares by bank wire, U.S. Postal money order, U.S.
Treasury check, Federal Reserve check, or automatic investment plans.
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at
the next NAV calculated after your order is received in proper form.
Note the following:
(small solid bullet) Normally, redemption proceeds will be mailed to
you on the next business day, but if making immediate payment could
adversely affect the fund, it may take up to seven days to pay you.
(small solid bullet) The fund may hold payment on redemptions until it
is reasonably satisfied that investments made by check have been
collected, which can take up to seven business days.
(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.
The fund reserves the right to impose a trading fee on redemptions and
exchanges from the fund.
FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of
$12.00 from accounts with a value of less than $2,500 subject to an
annual maximum charge of $60.00 per shareholder. Accounts opened after
September 30 will not be subject to the fee for that year. The fee,
which is payable to the transfer agent, is designed to offset in part
the relatively higher costs of servicing smaller accounts. The fee
will not be deducted from retirement accounts (except non-prototype
retirement accounts), accounts using a systematic investment program,
certain (Network Level I and III) accounts which are maintained
through National Securities Clearing Corporation (NSCC), or if total
assets in Fidelity mutual funds exceed $50,000. Eligibility for the
$50,000 waiver is determined by aggregating Fidelity mutual fund
accounts (excluding contractual plans) maintained (i) by FIIOC and
(ii) through NSCC; provided those accounts are registered under the
same primary social security number.
IF YOUR NON-RETIREMENT ACCOUNT BALANCE FALLS BELOW $1,000, you will be
given 30 days' notice to reestablish the minimum balance. If you do
not increase your balance, Fidelity reserves the right to close your
account and send the proceeds to you. Your shares will be redeemed 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.
FDC will, at its expense, provide promotional incentives such as sales
contests and luxury trips to investment professionals who support the
sale of shares of the funds. In some instances, these incentives will
be offered only to certain types of investment professionals, such as
bank-affiliated or non-bank affiliated broker-dealers, or to
investment professionals whose representatives provide services in
connection with the sale or expected sale of significant amounts of
shares.
EXCHANGE RESTRICTIONS
As a shareholder, you have the privilege of exchanging your
Institutional Class shares for Institutional Class shares of other
Fidelity Advisor funds or for shares of other Fidelity funds. However,
you should note the following:
(small solid bullet) The fund or class you are exchanging into must be
available for sale in your state.
(small solid bullet) You may only exchange between accounts that are
registered in the same name, address, and taxpayer identification
number.
(small solid bullet) Before exchanging into a fund or class, read its
prospectus.
(small solid bullet) If you exchange into a fund with a sales charge,
you pay the percentage difference between that fund's sales charge and
any sales charge you may have previously paid in connection with the
shares you are exchanging. For example, if you had already paid a
sales charge of 2% on your shares and you exchange them into a fund
with a 3% sales charge, you would pay an additional 1% sales charge.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) T he fund reserves the right to temporarily
or permanently terminate the exchange privilege of any investor who
makes more than four exchanges out of a fund per calendar year.
Accounts under common ownership or control, including accounts with
the same taxpayer identification number, will be counted together for
purposes of the four exchange limit.
(small solid bullet) The exchange limit may be modified for accounts
in certain institutional retirement plans to conform to plan exchange
limits and Department of Labor regulations. See your plan materials
for further information.
(small solid bullet) Each fund reserves the right to refuse exchange
purchases by any person or group if, in FMR's judgment, the fund would
be unable to invest the money effectively in accordance with its
investment objective and policies, or would otherwise potentially be
adversely affected.
Although the fund will attempt to give you prior notice whenever it is
reasonably able to do so, it may impose these restrictions at any
time. The fund reserves the right to terminate or modify the exchange
privilege 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.
No dealer, sales representative, or any other person has been
authorized to give any information or to make any representations,
other than those contained in this Prospectus and in the related SAI,
in connection with the offer contained in this Prospectus. If given or
made, such other information or representations must not be relied
upon as having been authorized by the fund or FDC. This Prospectus and
the related SAI do not constitute an offer by the fund or by FDC to
sell or to buy shares of the fund to any person to whom it is unlawful
to make such offer.
Fidelity, Fidelity Investments & (Pyramid) Design, Fidelity
Investments, and Directed Dividends are registered trademarks of FMR
Corp.
Portfolio Advisory Services is a service mark of FMR Corp.
Please read this prospectus before investing, and keep it on file for
future reference. It contains important information, including how the
fund invests and the services available to shareholders.
FIDELITY
ADVISOR SMALL CAP
FUND
CLASS A, CLASS T,
CLASS B
AND CLASS C
To learn more about the fund and its investments, you can obtain a
copy of the fund's Statement of Additional Information (SAI) dated
September 6, 1998. The SAI has been filed with the Securities and
Exchange Commission (SEC) and is available along with other related
materials on the SEC's Internet Web site (http://www.sec.gov). The SAI
is incorporated herein by reference (legally forms a part of the
prospectus). For a free copy of either document, contact Fidelity
Distributors Corporation (FDC), 82 Devonshire Street, Boston, MA
02109, or your investment professional.
LIKE ALL MUTUAL FUNDS, THESE SECURITIES HAVE
NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, NOR
HAS THE SECURITIES AND EXCHANGE
COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
ASCF-PRO-0998
706777
MUTUAL FUND SHARES ARE NOT DEPOSITS OR
OBLIGATIONS OF, OR GUARANTEED BY, ANY
DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY
THE FDIC, FEDERAL RESERVE BOARD OR ANY OTHER
AGENCY, AND ARE SUBJECT TO INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
Fund 294 - Class A
Fund 299 - Class T
Fund 296 - Class B
Fund 297 - Class C
A fund of Fidelity Advisor Series I
PROSPECTUS
SEPTEMBER 6, 1998(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON,
MA 02109
CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
KEY FACTS 36 WHO MAY WANT TO INVEST
36 EXPENSES EACH CLASS'S SALES CHARGE (LOAD) AND ITS YEARLY OPERATING
EXPENSES.
38 PERFORMANCE
THE FUND IN DETAIL 38 CHARTER HOW THE FUND IS ORGANIZED.
38 INVESTMENT PRINCIPLES AND RISKS THE FUND'S OVERALL APPROACH TO
INVESTING.
40 BREAKDOWN OF EXPENSES HOW OPERATING COSTS ARE CALCULATED
AND WHAT THEY INCLUDE.
YOUR ACCOUNT 41 TYPES OF ACCOUNTS DIFFERENT WAYS TO SET UP YOUR ACCOUNT,
INCLUDING TAX-ADVANTAGED RETIREMENT PLANS.
42 HOW TO BUY SHARES OPENING AN ACCOUNT AND MAKING ADDITIONAL
INVESTMENTS.
43 HOW TO SELL SHARES TAKING MONEY OUT AND CLOSING YOUR ACCOUNT.
27 INVESTOR SERVICES SERVICES TO HELP YOU MANAGE YOUR ACCOUNT.
SHAREHOLDER AND ACCOUNT POLICIES 46 DIVIDENDS, CAPITAL GAINS, AND TAXES
28 TRANSACTION DETAILS SHARE PRICE CALCULATIONS AND THE TIMING OF
PURCHASES AND REDEMPTIONS.
49 EXCHANGE RESTRICTIONS
49 SALES CHARGE REDUCTIONS AND WAIVERS
</TABLE>
KEY FACTS
WHO MAY WANT TO INVEST
Class A, Class T, Class B, and Class C shares are offered to investors
who engage an investment professional for investment advice.
The fund may be appropriate for investors who are willing to ride
out stock market fluctuations in pursuit of potentially high long-term
returns. The fund is designed for aggressive investors who believe
small capitalization stocks offer the potential for growth. A
company's market capitalization is the total market value of its
outstanding common stock.
The value of the fund's investments varies from day to day, generally
reflecting changes in market conditions, interest rates, and other
company, political, and economic news both here and abroad. In the
short term, stock prices can fluctuate dramatically in response to
these factors. The securities of small, less well-known companies may
be more volatile than those of larger companies. Over time, however,
stocks have shown greater growth potential than other types of
securities. Investments in foreign securities may involve risks in
addition to those of U.S. investments, including increased political
and economic risk, as well as exposure to currency fluctuations.
The fund is not in itself a balanced investment plan. You should
consider your investment objective and tolerance for risk when making
an investment decision. When you sell your fund shares, they may be
worth more or less than what you paid for them.
The fund is composed of multiple classes of shares. All classes of the
fund have a common investment objective and investment portfolio.
Class A and Class T shares have a front-end sales charge and pay a
12b-1 fee. Class A and Class T shares may be subject to a contingent
deferred sales charge (CDSC). Class B and Class C shares do not have a
front-end sales charge, but do have a CDSC, and pay a 12b-1 fee.
Institutional Class shares have no sales charge, and do not pay a
12b-1 fee, but are available only to certain types of investors. See
"Sales Charge Reductions and Waivers," page , for Institutional
Class eligibility information. You may obtain more information about
Institutional Class shares, which are not offered through this
prospectus, by calling 1-800-522-7297 if you are investing through a
broker-dealer or insurance representative, or 1-800-843-3001 if
you are investing through a bank representative, or from your
investment professional.
The performance of one class of shares of a fund may be different from
the performance of another class of shares of the same fund because of
different sales charges and class expenses. Contact your investment
professional to discuss which class is appropriate for you.
In determining which class of shares is appropriate for you, you
should consider, among other factors, the amount you plan to invest,
the length of time you intend to hold your shares, your eligibility
for a sales charge waiver or reduction, and the package of services
provided to you by your investment professional and the overall costs
of those services. In general, Class A shares have higher costs than
Class T over a short holding period because Class A shares have a
higher front-end sales charge, and Class A shares have lower costs
than Class T shares over a longer holding period because Class A
shares have lower 12b-1 fees. If you are planning to invest a
significant amount either at one time or through a regular investment
program, you should consider the reduced front-end sales charges
available on Class A and Class T shares. If you are eligible for a
front-end sales charge waiver on a purchase of both Class A and Class
T shares, Class A shares generally will have lower costs than Class T
shares because Class A shares have lower 12b-1 fees. However, you
should evaluate the overall costs of purchasing Class A shares or
Class T shares in the context of the package of services provided to
you by your investment professional. See "Transaction Details," page
30 , and "Sales Charge Reductions and Waivers," page ,
for sales charge reduction and waiver information.
If you prefer not to pay a front-end sales charge, you should consider
Class B or Class C shares. While Class B and Class C shares are
subject to higher ongoing costs than Class A or Class T shares because
of their higher 12b-1 fees, Class B and Class C shares are sold with a
CDSC instead of a front-end sales charge so your entire purchase
amount is immediately invested. In general, Class B shares have higher
costs than Class C shares over a short holding period because Class B
shares have a higher CDSC that declines over a maximum of six years,
and Class B shares have lower costs than Class C shares over a longer
period because Class B shares convert to Class A shares after a
maximum of seven years. Please note that purchase amounts of more than
$250,000 will not be accepted for Class B shares, that purchase
amounts of more than $1,000,000 will not be accepted for Class C
shares, and that Class A or Class T shares may have lower costs for
investments that qualify for a front-end sales charge reduction or
waiver. If you sell your Class B shares within six years, you will
normally pay a CDSC that varies depending on how long you have held
your shares. If you sell your Class C shares within one year, you will
normally pay a 1.00% CDSC. See "Transaction Details," page 30 ,
for CDSC schedules and related information. Class B shares will
automatically convert to Class A shares after a holding period of
seven years for the fund. Class C shares do not convert to another
class of shares. See "Transaction Details," page 30 , for
conversion information.
EXPENSES
SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy
or sell shares of the fund. In addition, you may be charged an annual
account maintenance fee if your account balance falls below $2,500.
Lower front-end sales charges may be available with purchases of
$50,000 or more. See "Transaction Details," page 30 , for an
explanation of how and when these charges apply.
A CDSC is imposed on Class B shares only if you redeem Class B shares
within six years of purchase. A CDSC is imposed on Class C shares only
if you redeem Class C shares within one year of purchase. See
"Transaction Details," page 30 , for information about the CDSC.
CLASS A CLASS T CLASS B CLASS C
MAXIMUM SALES CHARGE (AS A % 5.75% 3.50% NONE NONE
OF OFFERING PRICE) ON PURCHASES
OF SMALL CAP
MAXIMUM CDSC (AS A % OF THE NONE[A] NONE[A] 5.00%[B] 1.00%[C]
LESSER OF ORIGINAL PURCHASE PRICE
OR REDEMPTION PROCEEDS)
SALES CHARGE ON REINVESTED NONE NONE NONE NONE
DISTRIBUTIONS
ANNUAL ACCOUNT MAINTENANCE FEE $12.00 $12.00 $12.00 $12.00
(FOR ACCOUNTS UNDER $2,500)
[A] A CONTINGENT DEFERRED SALES CHARGE OF 0.25% IS ASSESSED ON CERTAIN
REDEMPTIONS OF CLASS A AND CLASS T SHARES ON WHICH A FINDER'S FEE WAS
PAID. SEE "TRANSACTION DETAILS", PAGE 30 .
[B] DECLINES OVER 6 YEARS FROM 5.00% TO 0%.
[C] ON CLASS C SHARES REDEEMED WITHIN 1 YEAR OF PURCHASE.
ANNUAL OPERATING EXPENSES are paid out of the fund's assets. The fund
pays a management fee to Fidelity Management & Research Company (FMR).
It also incurs other expenses for services such as maintaining
shareholder records and furnishing shareholder statements and
financial reports.
12b-1 fees for Class A, Class T, Class B, and Class C include a
distribution fee and, for Class B and Class C, a shareholder service
fee. Distribution fees are paid by each class to FDC for services and
expenses in connection with the distribution of the applicable class's
shares. Shareholder service fees are paid by Class B and Class C of
the fund to FDC for services and expenses incurred in connection with
providing personal service and/or maintenance of Class B and Class C
shareholder accounts. 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 class's expenses are factored into its share price or dividends
and are not charged directly to shareholder accounts (see "Breakdown
of Expenses" on page ).
The following figures are based on estimated expenses of Class A,
Class T, Class B and Class C of the fund and are calculated as a
percentage of average net assets of Class A, Class T, Class B and
Class C of the fund.
CLASS A CLASS T CLASS B CLASS C
MANAGEMENT FEE 0.74% 0.74% 0.74% 0.74%
12B-1 FEE (INCLUDING 0.25% 0.25% 0.50% 1.00% 1.00%
SHAREHOLDER SERVICE FEE FOR
CLASS B AND CLASS C SHARES)
OTHER EXPENSES 0.64% 0.60% 0.62% 0.62%
TOTAL OPERATING EXPENSES 1.63% 1.84% 2.36% 2.36%
EXPENSE TABLE EXAMPLE: You would pay the following amount in total
expenses on a $1,000 investment, assuming a 5% annual return and
either (1) full redemption or (2) no redemption at the end of each
time period. Total expenses shown below include your shareholder
transaction expenses, such as the maximum front-end sales charge or
CDSC, as applicable, and a class's annual operating expenses.
SMALL CAP
1 YEAR 3 YEARS
(1) (2) (1) (2)
CLASS A $ 73 $ 106
CLASS T $ 53 $ 91
CLASS B $ 74[A] $ 24 $ 104[A] $ 74
CLASS C $ 34[A] $ 24 $ 74 $ 74
[A] REFLECTS DEDUCTION OF APPLICABLE CDSC.
THESE EXAMPLES ILLUSTRATE THE EFFECT OF EXPENSES, BUT ARE NOT MEANT TO
SUGGEST ACTUAL OR EXPECTED EXPENSES OR RETURNS, ALL OF WHICH MAY VARY.
FMR has voluntarily agreed to reimburse Class A, Class T, 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 the following rates:
CLASS A EFFECTIVE DATE
1.75% SEPTEMBER 6, 1998
CLASS T EFFECTIVE DATE
2.00% SEPTEMBER 6, 1998
CLASS B EFFECTIVE DATE
2.50% SEPTEMBER 6, 1998
CLASS C EFFECTIVE DATE
2.50% SEPTEMBER 6, 1998
PERFORMANCE
Mutual fund performance is commonly measured as TOTAL RETURN.
Performance history will be available for the fund after the fund has
been in operation for six months.
TOTAL RETURN is the change in value of an investment over a given
period, assuming reinvestment of any dividends and capital gains. A
CUMULATIVE TOTAL RETURN reflects actual performance over a stated
period of time. An AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate
of return that, if achieved annually, would have produced the same
cumulative total return if performance had been constant over the
entire period. Average annual total returns smooth out variations in
performance; they are not the same as actual year-by-year results.
Average annual total returns covering periods of less than one year
assume that performance will remain constant for the rest of the year.
Average annual and cumulative total returns usually will include the
effect of paying the maximum applicable sales charge.
RUSSELL 2000 INDEX is an unmanaged index of 2,000 small company
stocks.
Unlike each class's returns, the total returns of the comparative
index do not include the effect of any brokerage commissions,
transaction fees, or other costs of investing.
Other illustrations of fund performance may show moving averages over
specified periods.
The fund's recent strategies, performance, and holdings are detailed
twice a year in financial reports, which are sent to all shareholders.
THE FUND IN DETAIL
CHARTER
ADVISOR SMALL CAP IS A MUTUAL FUND: an investment that pools
shareholders' money and invests it toward a specified goal. The fund
is a diversified fund of Fidelity Advisor Series I, an open-end
management investment company organized as a Massachusetts business
trust on June 24, 1983.
THE FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet periodically throughout the year to oversee the
fund's activities, review contractual arrangements with companies that
provide services to the fund, and review the fund's performance. The
trustees serve as trustees for other Fidelity funds. The majority of
trustees are not otherwise affiliated with Fidelity.
THE FUND MAY HOLD SPECIAL SHAREHOLDER MEETINGS AND MAIL PROXY
MATERIALS. These meetings may be called to elect or remove trustees,
change fundamental policies, approve a management contract, or for
other purposes. Shareholders not attending these meetings are
encouraged to vote by proxy. The transfer agent will mail proxy
materials in advance, including a voting card and information about
the proposals to be voted on. The number of votes you are entitled to
is based upon the dollar value of your investment.
Separate votes are taken by each class of shares, fund, or trust, if a
matter affects just that class of shares, fund, or trust,
respectively.
FMR AND ITS AFFILIATES
Fidelity Investments(registered trademark) is one of the largest
investment management organizations in the United States and has its
principal business address at 82 Devonshire Street, Boston,
Massachusetts 02109. It includes a number of different subsidiaries
and divisions which provide a variety of financial services and
products. The fund employs various Fidelity companies to perform
activities required for its operation.
The fund is managed by FMR, which chooses the fund's investments and
handles its business affairs. Affiliates assist FMR with foreign
investments:
(small solid bullet) Fidelity Management & Research (U.K.) Inc.
(FMR U.K.), in London, England serves as a sub-adviser for the
fund.
(small solid bullet) Fidelity Management & Research Far East Inc.
(FMR Far East), in Tokyo, Japan, serves as a sub-adviser for the
fund.
As of July 31, 1998, FMR advised funds having approximately
38 million shareholder accounts with a total value of more than
$ 611 billion.
Harry Lange is manager of Advisor Small Cap, which he has managed
since inception. He also manages another Fidelity fund. Since joining
Fidelity in 1987, Mr. Lange has worked as an analyst, manager and
director of research.
Fidelity investment personnel may invest in securities for their own
accounts pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
Fidelity Distributors Corporation (FDC) distributes and markets
Fidelity's funds and services.
Fidelity Investments Institutional Operations Company (FIIOC) performs
transfer agent servicing functions for each class of the fund.
FMR Corp. is the ultimate parent company of FMR, FMR U.K., and FMR Far
East. Members of the Edward C. Johnson 3d family are the predominant
owners of a class of shares of common stock representing approximately
49% of the voting power of FMR Corp. Under the Investment Company Act
of 1940 (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, the Johnson family may be deemed
under the 1940 Act to form a controlling group with respect to FMR
Corp.
FMR may use its broker-dealer affiliates and other firms that sell
fund shares to carry out the fund's transactions, provided that the
fund receives brokerage services and commission rates comparable to
those of other broker-dealers.
INVESTMENT PRINCIPLES AND RISKS
THE FUND seeks long-term growth of capital by investing primarily in
equity securities of companies with small market capitalizations. FMR
normally invests at least 65% of the fund's total assets in these
securities. The fund has the flexibility, however, to invest in other
market capitalizations and security types.
Small market capitalization companies are those whose market
capitalization is similar to the market capitalization of companies in
the Russell 2000 at the time of the fund's investment. Companies whose
capitalization no longer meets this definition after purchase continue
to be considered small-capitalized for purposes of the 65% policy. As
o f June 30, 199 8 , the Russell 2000 included companies
with capitalizations between $ 110 million and $2.5
billion. The size of companies in the Russell 2000 changes with
market conditions and the composition of the index.
Investing in small capitalization stocks may involve greater risk than
investing in medium and large capitalization stocks, since they can be
subject to more abrupt or erratic movements. Small capitalization
companies may have more limited product lines, markets, or financial
resources.
The value of the fund's investments varies in response to many
factors. Stock values fluctuate in response to the activities of
individual companies and general market and economic conditions.
Investments in foreign securities may involve risks in addition to
those of U.S. investments, including increased political and economic
risk, as well as exposure to currency fluctuations.
FMR may use various investment techniques to hedge a portion of the
fund's risks, but there is no guarantee that these strategies will
work as FMR intends. As a mutual fund, the fund seeks to spread
investment risk by diversifying its holdings among many companies and
industries. When you sell your shares of the fund, they may be worth
more or less than what you paid for them.
FMR normally invests the fund's assets according to its investment
strategy. The fund also reserves the right to invest without
limitation in preferred stocks and investment-grade debt instruments
for temporary, defensive purposes.
SECURITIES AND INVESTMENT PRACTICES
The following pages contain more detailed information about types of
instruments in which the fund may invest, strategies FMR may employ in
pursuit of the fund's investment objective, and a summary of related
risks. Any restrictions listed supplement those discussed earlier in
this section. A complete listing of the fund's limitations and more
detailed information about the fund's investments are contained in the
fund's SAI. Policies and limitations are considered at the time of
purchase; the sale of instruments is not required in the event of a
subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these
techniques unless it believes that they are consistent with the fund's
investment objective and policies and that doing so will help the fund
achieve its goal. Fund holdings and recent investment strategies are
detailed in the fund's financial reports, which are sent to
shareholders twice a year. For a free SAI or financial report, call
your investment professional.
EQUITY SECURITIES may include common stocks, preferred stocks,
convertible securities, and warrants. Common stocks, the most familiar
type, represent an equity (ownership) interest in a corporation.
Although equity securities have a history of long-term growth in
value, their prices fluctuate based on changes in a company's
financial condition and on overall market and economic conditions.
Smaller companies are especially sensitive to these factors.
RESTRICTIONS: With respect to 75% of total assets, the fund may not
invest in more than 10% of the outstanding voting securities of a
single issuer. This limitation does not apply to securities of other
investment companies.
DEBT SECURITIES. Bonds and other debt instruments are used by issuers
to borrow money from investors. The issuer generally pays the investor
a fixed, variable, or floating rate of interest, and must repay the
amount borrowed at maturity. Some debt securities, such as zero coupon
bonds, do not pay current interest, but are sold at a discount from
their face values.
Debt securities have varying levels of sensitivity to changes in
interest rates and varying degrees of credit quality. In general, bond
prices rise when interest rates fall, and fall when interest rates
rise. Longer-term bonds and zero coupon bonds are generally more
sensitive to interest rate changes.
Lower-quality debt securities are considered to have speculative
characteristics, and involve greater risk of default or price changes
due to changes in the issuer's creditworthiness, or they may already
be in default. The market prices of these securities may fluctuate
more than higher-quality securities and may decline significantly in
periods of general or regional economic difficulty.
RESTRICTIONS: Purchase of a debt security is consistent with the
fund's debt quality policy if it is rated at or above the stated level
by Moody's Investors Service or rated in the equivalent categories by
Standard & Poor's, or is unrated but judged to be of equivalent
quality by FMR. The fund currently intends to limit its investments in
lower than Baa-quality debt securities (sometimes called "junk bonds")
to less than 35% of its assets.
EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies,
and securities issued by U.S. entities with substantial foreign
operations may involve additional risks and considerations. These
include risks relating to political, economic, or regulatory
conditions in foreign countries; fluctuations in foreign currencies;
withholding or other taxes; trading, settlement, custodial, and other
operational risks; and the potentially less stringent investor
protection and disclosure standards of foreign markets. Additionally,
governmental issuers of foreign debt securities may be unwilling to
pay interest and repay principal when due and may require that the
conditions for payment be renegotiated. All of these factors can make
foreign investments, especially those in emerging markets, more
volatile and potentially less liquid than U.S. investments.
REPURCHASE AGREEMENTS. In a repurchase agreement, the fund buys a
security at one price and simultaneously agrees to sell it back at a
higher price. Delays or losses could result if the other party to the
agreement defaults or becomes insolvent.
ADJUSTING INVESTMENT EXPOSURE. The fund can use various techniques to
increase or decrease its exposure to changing security prices,
interest rates, currency exchange rates, commodity prices, or other
factors that affect security values. These techniques may involve
derivative transactions such as buying and selling options and futures
contracts, entering into currency exchange contracts or swap
agreements, and purchasing indexed securities.
FMR can use these practices to adjust the risk and return
characteristics of the fund's portfolio of investments. If FMR judges
market conditions incorrectly or employs a strategy that does not
correlate well with the fund's investments, these techniques could
result in a loss, regardless of whether the intent was to reduce risk
or increase return. These techniques may increase the volatility of
the fund and may involve a small investment of cash relative to the
magnitude of the risk assumed. In addition, these techniques could
result in a loss if the counterparty to the transaction does not
perform as promised.
DIRECT DEBT. Loans and other direct debt instruments are interests in
amounts owed to another party by a company, government, or other
borrower. They have additional risks beyond conventional debt
securities because they may entail less legal protection for the fund,
or there may be a requirement that the fund supply additional cash to
a borrower on demand.
DEBT RATINGS
MOODY'S
INVESTORS
SERVICE STANDARD & POOR'S
Rating Rating
INVESTMENT GRADE
Highest quality Aaa AAA
High quality Aa AA
Upper-medium grade A A
Medium grade Baa BBB
LOWER QUALITY
Moderately speculative Ba BB
Speculative B B
Highly speculative Caa CCC
Poor quality Ca CC
Lowest quality, no interest C C
In default, in arrears D
REFER TO THE FUND'S SAI FOR A MORE COMPLETE DISCUSSION OF THESE
RATINGS.
THE FUND DOES NOT NECESSARILY RELY ON THE RATINGS OF MOODY'S OR S&P TO
DETERMINE COMPLIANCE WITH ITS DEBT QUALITY POLICY.
ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined
by FMR, under the supervision of the Board of Trustees, to be
illiquid, which means that they may be difficult to sell promptly at
an acceptable price. The sale of some illiquid securities, and some
other securities, may be subject to legal restrictions. Difficulty in
selling securities may result in a loss or may be costly to the fund.
RESTRICTIONS: The fund may not invest more than 10% of its assets in
illiquid securities.
OTHER INSTRUMENTS may include real estate-related instruments.
CASH MANAGEMENT. The fund may invest in money market securities, in
repurchase agreements, and in a money market fund available only to
funds and accounts managed by FMR or its affiliates, whose goal is to
seek a high level of current income while maintaining a stable $1.00
share price. A major change in interest rates or a default on the
money market fund's investments could cause its share price to change.
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce
the risks of investing. This may include limiting the amount of money
invested in any one issuer or, on a broader scale, in any one
industry. Economic, business, or political changes can affect all
securities of a similar type.
RESTRICTIONS: With respect to 75% of its total assets, the fund may
not invest more than 5% in the securities of any one issuer. This
limitation does not apply to U.S. Government securities or to
securities of other investment companies.
The fund may not invest more than 25% of its total assets in any one
industry. This limitation does not apply to U.S. Government
securities.
BORROWING. The fund may borrow from banks or from other funds advised
by FMR or its affiliates, or through reverse repurchase agreements. If
the fund borrows money, its share price may be subject to greater
fluctuation until the borrowing is paid off. If the fund makes
additional investments while borrowings are outstanding, this may be
considered a form of leverage.
RESTRICTIONS: The fund may borrow only for temporary or emergency
purposes, but not in an amount exceeding 331/3% of its total assets.
LENDING securities to broker-dealers and institutions, including
Fidelity Brokerage Services, Inc. (FBSI), an affiliate of FMR, is a
means of earning income. This practice could result in a loss or a
delay in recovering the fund's securities. The fund may also lend
money to other funds advised by FMR or its affiliates.
RESTRICTIONS: Loans, in the aggregate, may not exceed 331/3% of the
fund's total assets.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
Some of the policies and restrictions discussed on the preceding pages
are fundamental, that is, subject to change only by shareholder
approval. The following paragraphs restate all those that are
fundamental. All policies stated throughout this prospectus, other
than those identified in the following paragraphs, can be changed
without shareholder approval.
The fund seeks long-term growth of capital.
With respect to 75% of its total assets, the fund may not invest more
than 5% in the securities of any one issuer and may not invest in more
than 10% of the outstanding voting securities of a single issuer.
These limitations do not apply to U.S. Government securities or to
securities of other investment companies.
The fund may not invest more than 25% of its total assets in any one
industry. This limitation does not apply to U.S. Government
securities.
The fund may borrow only for temporary or emergency purposes, but not
in an amount exceeding 331/3% of its total assets.
Loans, in the aggregate, may not exceed 331/3% of the fund's total
assets.
BREAKDOWN OF EXPENSES
Like all mutual funds, the fund pays fees related to its daily
operations. Expenses paid out of each class's assets are reflected in
that class's share price or dividends; they are neither billed
directly to shareholders nor deducted from shareholder accounts.
The fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. FMR in turn pays fees to affiliates who provide
assistance with these services. The fund also pays OTHER EXPENSES,
which are explained at right.
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, in the case of certain classes, which may be terminated
at any time without notice, can decrease a class's expenses and boost
its performance.
MANAGEMENT FEE
The management fee is calculated and paid to FMR every month. The fee
is calculated by adding a group fee rate to an individual fund fee
rate, dividing by twelve, and multiplying the result by the
fund's average net assets throughout the month .
The group fee rate is based on the average net assets of all the
mutual funds advised by FMR. This rate cannot rise above 0.52%, and it
drops as total assets under management increase.
For July 1998, the group fee rate was 0.2875 %. The
individual fund fee rate is 0.45%.
FMR HAS SUB-ADVISORY AGREEMENTS with FMR U.K. and FMR Far East. These
sub-advisers provide FMR with investment research and advice on
issuers based outside the United States. Under the sub-advisory
agreements, FMR pays FMR U.K. and FMR Far East fees equal to 110% and
105%, respectively, of the costs of providing these services.
The sub-advisers may also provide investment management services. In
return, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of its
management fee rate with respect to the fund's investments that the
sub-adviser manages on a discretionary basis.
OTHER EXPENSES
While the management fee is a significant component of the fund's
annual operating costs, the fund has other expenses as well.
FIIOC performs transfer agency, dividend disbursing and shareholder
servicing functions for each class of the fund. Fidelity Service
Company, Inc. (FSC) calculates the net asset value per share (NAV) and
dividends for each class and maintains the fund's general accounting
records, and administers the fund's securities lending program.
The fund also pays other expenses, such as legal, audit, and custodian
fees; in some instances, proxy solicitation costs; and the
compensation of trustees who are not affiliated with Fidelity. A
broker-dealer may use a portion of the commissions paid by the fund to
reduce the fund's custodian or transfer agent fees.
Class A and Class T shares of the fund have adopted a DISTRIBUTION AND
SERVICE PLAN. Under the plans, Class A and Class T of the fund are
authorized to pay FDC a monthly distribution fee as compensation for
its services and expenses in connection with the distribution of Class
A and Class T shares. Class A and Class T of the fund may pay FDC a
distribution fee at an annual rate of 0.75% of its average net assets,
or such lesser amount as the Trustees may determine from time to time.
Class A and Class T of the fund currently pays FDC a monthly
distribution fee at an annual rate of 0.25% and 0.50%, respectively,
of its average net assets throughout the month. Class A and Class T
distribution fee rates may be increased only when the Trustees believe
that it is in the best interests of Class A and Class T shareholders
to do so.
Up to the full amount of the Class A and Class T distribution fees may
be reallowed to investment professionals, as compensation for their
services in connection with the distribution of Class A and Class T
shares and for providing support services to Class A and Class T
shareholders, based upon the level of such services provided. These
services may include, without limitation, answering investor inquiries
regarding the funds; providing assistance to investors in changing
dividend options, account designations, and addresses; performing
subaccounting and maintaining Class A and Class T shareholder
accounts; processing purchase and redemption transactions, including
automatic investment and redemption of investor account balances;
providing periodic statements showing an investor's account balance
and integrating other transactions into such statements; and
performing other administrative services in support of the
shareholder.
Class B shares of the fund, have adopted a DISTRIBUTION AND SERVICE
PLAN. Under the plan, Class B of the fund is authorized to pay FDC a
monthly distribution fee as compensation for its services and expenses
in connection with the distribution of Class B shares. Class B of the
fund may pay FDC a distribution fee at an annual rate of 0.75% of its
average net assets, or such lesser amount as the Trustees may
determine from time to time. Class B of the fund currently pays FDC a
monthly 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 of the fund pays
FDC a monthly service fee at an annual rate of 0.25% of Class B's
average net assets throughout the month. Up to the full amount
of the Class B service fee may be reallowed to investment
professionals for providing personal service to and/or maintenance of
Class B shareholder accounts.
Class C shares of the fund have adopted a DISTRIBUTION AND SERVICE
PLAN. Under the plan, Class C of the fund is authorized to pay FDC a
monthly distribution fee as compensation for its services and expenses
in connection with the distribution of Class C shares. Class C of the
fund may pay FDC a distribution fee at an annual rate of 0.75% of its
average net assets, or such lesser amount as the Trustees may
determine from time to time. Class C of the fund currently pays FDC a
monthly distribution fee at an annual rate of 0.75% of its average net
assets throughout the month. Normally, after the first year of
investment, up to the full amount of the Class C distribution fee may
be reallowed to investment professionals as compensation for their
services in connection with the distribution of Class C shares.
In addition, pursuant to the Class C plan, Class C of the fund pays
FDC a monthly service fee at an annual rate of 0.25% of Class C's
average net assets throughout the month. Normally, after the first
year of investment, up to the full amount of the Class C
service fee may be reallowed to investment professionals for
providing personal service to and/or maintenance of Class C
shareholder accounts.
For purchases of Class C shares made for an employee benefit plan
or through reinvested dividends or capital gain distributions ,
during the first year of investment and thereafter, up to the
full amount of the Class C distribution fee and Class C service fee
paid by such shares may be reallowed to investment
professionals as compensation for their services in connection with
the distribution of Class C shares and for providing personal service
to and/or maintenance of Class C shareholder accounts.
The Class A, Class T, Class B and Class C plans specifically recognize
that FMR may make payments from its management fee revenue, past
profits, or other resources to FDC for expenses incurred in connection
with the distribution of the applicable class's shares, including
payments made to investment professionals that provide shareholder
support services or engage in the sale of the applicable class's
shares. Currently, the Board of Trustees has authorized such payments.
The fund's portfolio turnover rate will vary from year to year. High
turnover rates increase transaction costs and may increase taxable
capital gains. FMR considers these effects when evaluating the
anticipated benefits of short-term investing.
YOUR ACCOUNT
TYPES OF ACCOUNTS
When you invest through an investment professional, your investment
professional, including a broker-dealer or financial institution, may
charge you a transaction fee with respect to the purchase and sale of
fund shares. Read your investment professional's program materials in
conjunction with this prospectus for additional service features or
fees that may apply. Certain features of the fund, such as minimum
initial or subsequent investment amounts, may be modified.
The different ways to set up (register) your account with Fidelity are
listed at right.
The account guidelines that follow may not apply to certain retirement
accounts. If you are investing through a retirement account or if your
employer offers the fund through a retirement program, you may be
subject to additional fees. For more information, please refer to your
program materials, contact your employer, or call your retirement
benefits number or your investment professional directly, as
appropriate.
If you have selected Fidelity Advisor funds as an investment option
through an insurance company group pension program, please contact the
provider directly.
WAYS TO SET UP YOUR ACCOUNT
INDIVIDUAL OR JOINT TENANT
FOR YOUR GENERAL INVESTMENT NEEDS
Individual accounts are owned by one person. Joint accounts can have
two or more owners (tenants).
RETIREMENT
FOR TAX-ADVANTAGED RETIREMENT SAVINGS
Retirement plans provide individuals with tax-advantaged ways to save
for retirement, either with tax-deductible contributions or tax-free
growth. Retirement accounts require special applications and typically
have lower minimums.
(solid bullet) TRADITIONAL INDIVIDUAL RETIREMENT ACCOUNTS (IRAS) allow
individuals under age 70 1/2 (checkmark)(solid club) with compensation
to contribute up to $2,000 per tax year. Married couples can
contribute up to $4,000 per tax year, provided no more than $2,000 is
contributed on behalf of either spouse. (These limits are aggregate
for Traditional and Roth IRAs.) Contributions may be tax-deductible,
subject to certain income limits.
(solid bullet) ROTH IRAS allow individuals to make non-deductible
contributions of up to $2,000 per tax year. Married couples can
contribute up to $4,000 per tax year, provided no more than $2,000 is
contributed on behalf of either spouse. (These limits are aggregate
for Traditional and Roth IRAs.) Eligibility is subject to certain
income limits. Qualified distributions are tax-free.
(solid bullet) ROTH CONVERSION IRAS allow individuals with assets held
in a Traditional IRA or Rollover IRA to convert those assets to a Roth
Conversion IRA. Eligibility is subject to certain income limits.
Qualified distributions are tax-free.
(solid bullet) ROLLOVER IRAS help retain special tax advantages for
certain eligible rollover distributions from employer-sponsored
retirement plans.
(solid bullet) 401(K) PLANS, and certain other 401(a)-qualified plans,
are employer-sponsored retirement plans that allow employer
contributions and may allow employee after-tax contributions. In
addition, 401(k) plans allow employee pre-tax (tax-deferred)
contributions. Contributions to these plans may be tax-deductible to
the employer.
(solid bullet) KEOGH PLANS are generally profit sharing or money
purchase pension plans that allow self-employed individuals or small
business owners to make tax-deductible contributions for themselves
and any eligible employees.
(solid bullet)SIMPLE IRAS provide small business owners and those with
self-employment income (and their eligible employees) with many of the
advantages of a 401(k) plan, but with fewer administrative
requirements.
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS) provide
small business owners or those with self-employment income (and their
eligible employees) with many of the same advantages as a Keogh, but
with fewer administrative requirements.
(solid bullet) SALARY REDUCTION SEP-IRAS (SARSEPS) allow employees of
businesses with 25 or fewer employees to contribute a percentage of
their wages on a tax-deferred basis. These plans must have been
established by the employer prior to January 1, 1997.
GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA)
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS
These custodial accounts provide a way to give money to a child and
obtain tax benefits. An individual can give up to $10,000 a year per
child without paying federal gift tax. Depending on state laws, you
can set up a custodial account under the Uniform Gifts to Minors Act
(UGMA) or the Uniform Transfers to Minors Act (UTMA). Contact your
investment professional.
TRUST
FOR MONEY BEING INVESTED BY A TRUST
The trust must be established before an account can be opened.
BUSINESS OR ORGANIZATION
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR
OTHER GROUPS
Contact your investment professional.
HOW TO BUY SHARES
THE PRICE TO BUY ONE SHARE of Class A or Class T is the class's
offering price or the class's net asset value per share (NAV),
depending on whether you pay a front-end sales charge. If you pay a
front-end sales charge, your price will be Class A's or Class T's
offering price. When you buy Class A or Class T shares at the offering
price, Fidelity deducts the appropriate sales charge and invests the
rest in Class A or Class T shares of the fund. If you qualify for a
front-end sales charge waiver, your price will be Class A's or Class
T's NAV. See "Transaction Details," page 30 , and "Sales Charge
Reductions and Waivers," page , for explanations of how and
when the sales charge and waivers apply.
For Class B and Class C, the PRICE TO BUY ONE SHARE 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 CDSC upon redemption. See "Transaction
Details," page 30 , for information on how the CDSC is
calculated.
Your shares will be purchased at the next offering price or NAV, as
applicable, calculated after your order is received in proper form.
Each class's offering price and NAV, as applicable, are normally
calculated each business day at 4:00 p.m. Eastern time.
Short-term or excessive trading into and out of the fund may harm fund
performance by disrupting portfolio management strategies and by
increasing fund 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.
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.
Fidelity must receive payment within three business days after an
order for shares is placed; otherwise your purchase order may be
canceled and you could be held liable for resulting fees and/or
losses.
Share certificates are not available for Class A, Class T, Class B and
Class C shares.
IF YOU ARE NEW TO THE FIDELITY ADVISOR FUNDS, complete and sign an
account application and mail it along with your check. If there is no
account application accompanying this prospectus, call your investment
professional or, if you are investing through a broker-dealer or
insurance representative, call 1-800-522-7297 or, if you are investing
through a bank representative, call 1-800-843-3001.
If you are investing through a tax-advantaged retirement plan, such as
an IRA, for the first time, you will need a special application.
Contact your investment professional for more information and a
retirement account application.
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY ADVISOR FUND, you
can:
(solid bullet) Mail an account application with a check,
(solid bullet) Place an order and wire money into your account,
(solid bullet) Open your account by exchanging from the same class of
another Fidelity Advisor fund or from another Fidelity fund, or
(solid bullet) Contact your investment professional.
MINIMUM INVESTMENTS
TO OPEN AN ACCOUNT $2,500
For certain Fidelity Advisor retirement accounts* $500
Through regular investment plans** $1,000
TO ADD TO AN ACCOUNT $250
For certain Fidelity Advisor retirement accounts* $100
Through regular investment plans** $100
MINIMUM BALANCE $1,000
For certain Fidelity Advisor retirement accounts* None
* THESE LOWER MINIMUMS APPLY TO FIDELITY ADVISOR TRADITIONAL IRA, ROTH
IRA, ROTH CONVERSION IRA, ROLLOVER IRA, SEP-IRA, AND KEOGH ACCOUNTS.
** AN ACCOUNT MAY BE OPENED WITH A MINIMUM OF $1,000, PROVIDED THAT A
REGULAR INVESTMENT PLAN IS ESTABLISHED AT THE TIME THE ACCOUNT IS
OPENED. FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE
REFER TO "INVESTOR SERVICES," PAGE 29 .
Investment and account minimums are waived for purchases of Class T
shares with distributions from a Fidelity Defined Trust account.
There is no minimum account balance or initial or subsequent
investment minimum for certain Fidelity retirement accounts funded
through salary deduction, or accounts opened with the proceeds of
distributions from such retirement accounts. Refer to the program
materials for details. In addition, the fund reserves the right to
waive or lower investment 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.
For further information on opening an account, please consult your
investment professional or refer to the account application.
<TABLE>
<CAPTION>
<S> <C> <C>
TO OPEN AN ACCOUNT TO ADD TO AN ACCOUNT
PHONE YOUR INVESTMENT
PROFESSIONAL.
(PHONE_GRAPHIC)
(SMALL SOLID BULLET) CONTACT YOUR INVESTMENT PROFESSIONAL
OR, IF YOU ARE (SMALL SOLID BULLET) CONTACT YOUR INVESTMENT
PROFESSIONAL OR, IF YOU
ARE INVESTING
INVESTING THROUGH A BROKER-DEALER
OR INSURANCE THROUGH A BROKER-DEALER
OR INSURANCE REPRESENTATIVE,
CALL
REPRESENTATIVE, CALL 1-800-522-7297.
IF YOU ARE 1-800-522-7297. IF YOU ARE
INVESTING THROUGH A BANK
INVESTING THROUGH A BANK
REPRESENTATIVE, CALL REPRESENTATIVE, CALL
1-800-843-3001.
1-800-843-3001. (SMALL SOLID BULLET) EXCHANGE FROM THE SAME CLASS
OF ANOTHER FIDELITY ADVISOR
FUND
(SMALL SOLID BULLET) EXCHANGE FROM THE SAME CLASS OF
ANOTHER FIDELITY OR FROM ANOTHER FIDELITY
FUND ACCOUNT WITH THE SAME
ADVISOR FUND OR FROM ANOTHER
FIDELITY FUND ACCOUNT WITH REGISTRATION, INCLUDING
NAME, ADDRESS, AND TAXPAYER
ID NUMBER.
THE SAME REGISTRATION, INCLUDING
NAME, ADDRESS, AND TAXPAYER ID
NUMBER
MAIL
(MAIL_GRAPHIC)
(SMALL SOLID BULLET) COMPLETE AND SIGN THE ACCOUNT
APPLICATION. MAKE YOUR (SMALL SOLID BULLET) MAKE YOUR CHECK PAYABLE TO
THE COMPLETE NAME OF THE FUND
CHECK PAYABLE TO THE COMPLETE
NAME OF THE FUND AND AND NOTE THE APPLICABLE CLASS.
INDICATE YOUR FUND ACCOUNT
NOTE THE APPLICABLE CLASS.
MAIL TO THE ADDRESS INDICATED NUMBER ON YOUR CHECK AND MAIL
TO THE ADDRESS PRINTED ON YOUR
ON THE APPLICATION. ACCOUNT STATEMENT.
(SMALL SOLID BULLET) EXCHANGE BY MAIL: CALL YOUR
INVESTMENT PROFESSIONAL FOR
INSTRUCTIONS.
IN PERSON
(HAND_GRAPHIC)
(SMALL SOLID BULLET) BRING YOUR ACCOUNT APPLICATION
AND CHECK TO YOUR (SMALL SOLID BULLET) BRING YOUR CHECK TO YOUR
INVESTMENT PROFESSIONAL.
INVESTMENT PROFESSIONAL.
WIRE
(WIRE_GRAPHIC)
(SMALL SOLID BULLET) NOT AVAILABLE. (SMALL SOLID BULLET) WIRE TO:
BANKER'S TRUST CO.
ROUTING # 021001033
FIDELITY DART DEPOSITORY
ACCOUNT # 00159759
FBO:
(ACCOUNT NAME)(ACCOUNT NUMBER)
SPECIFY THE COMPLETE NAME OF
THE FUND OF YOUR CHOICE,
NOTE THE APPLICABLE CLASS,
AND INCLUDE YOUR ACCOUNT
NUMBER AND YOUR NAME.
AUTOMATICALLY
(AUTOMATIC_GRAPHIC)
(SMALL SOLID BULLET) NOT AVAILABLE. (SMALL SOLID BULLET) USE FIDELITY ADVISOR SYSTEMATIC
INVESTMENT PROGRAM. SIGN UP
FOR THIS SERVICE WHEN OPENING
YOUR ACCOUNT, OR CALL YOUR
INVESTMENT PROFESSIONAL TO
BEGIN THE PROGRAM.
</TABLE>
HOW TO SELL SHARES
You can arrange to take money out of your fund account at any time by
selling (redeeming) some or all of your shares.
The PRICE TO SELL ONE SHARE of Class A, Class T, Class B and Class C
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. Each class's
NAV is normally calculated each business day at 4:00 p.m. Eastern
time.
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.
TO SELL SHARES IN A NON-RETIREMENT ACCOUNT, you may use any of the
methods described on these two pages.
TO SELL SHARES IN A FIDELITY ADVISOR RETIREMENT ACCOUNT, your request
must be made in writing, except for exchanges to shares of the same
class of another Fidelity Advisor fund or shares of other Fidelity
funds, which can be requested by phone or in writing.
IF YOU ARE SELLING SOME BUT NOT ALL OF YOUR SHARES, leave at least
$1,000 worth of shares in the account to keep it open (account minimum
balances do not apply to retirement and Fidelity Defined Trust
accounts).
TO SELL SHARES BY BANK WIRE, you will need to sign up for this service
in advance.
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:
(solid bullet) You wish to redeem more than $100,000 worth of shares,
(solid bullet) Your account registration has changed within the last
30 days,
(solid bullet) The check is being mailed to a different address than
the one on your account (record address),
(solid bullet) The check is being made payable to someone other than
the account owner,
(solid bullet) The redemption proceeds are being transferred to a
Fidelity Advisor account with a different registration,
(solid bullet) You wish to set up the bank wire feature, or
(solid bullet) You wish to have redemption proceeds wired to a
non-predesignated bank account.
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.
SELLING SHARES IN WRITING
Write a "letter of instruction" with:
(solid bullet) Your name,
(solid bullet) The fund's name,
(solid bullet) The applicable class name,
(solid bullet) Your fund account number,
(solid bullet) The dollar amount or number of shares to be redeemed,
signed certificates (if previously issued), and
(solid bullet) Any other applicable requirements listed in the
following table.
Deliver your letter to your investment professional, or mail it to the
following address:
Fidelity Investments
P.O. Box 770002
Cincinnati, OH 45277-0081
Unless otherwise instructed, Fidelity will send a check to the record
address.
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ACCOUNT TYPE SPECIAL REQUIREMENTS
PHONE
(PHONE_GRAPHIC)
ALL ACCOUNT TYPES
EXCEPT RETIREMENT (SMALL SOLID BULLET) MAXIMUM CHECK REQUEST:
$100,000.
YOUR INVESTMENT
PROFESSIONAL. ALL ACCOUNT TYPES (SMALL SOLID BULLET) YOU MAY EXCHANGE TO THE SAME
CLASS OF OTHER FIDELITY
ADVISOR FUNDS OR TO OTHER
FIDELITY FUNDS IF BOTH
ACCOUNTS ARE REGISTERED
WITH THE SAME NAME(S),
ADDRESS, AND TAXPAYER ID
NUMBER.
MAIL OR IN PERSON
(MAIL_GRAPHIC)
(HAND_GRAPHIC)
INDIVIDUAL, JOINT TENANT,
SOLE PROPRIETORSHIP,
UGMA, UTMA (SMALL SOLID BULLET) THE LETTER OF INSTRUCTION
MUST BE SIGNED BY ALL PERSONS
REQUIRED TO SIGN FOR
TRANSACTIONS, EXACTLY AS
THEIR NAMES APPEAR ON THE
ACCOUNT AND SENT TO YOUR
INVESTMENT PROFESSIONAL.
RETIREMENT ACCOUNT (SMALL SOLID BULLET) THE ACCOUNT OWNER SHOULD
COMPLETE A RETIREMENT
DISTRIBUTION FORM. CONTACT
YOUR INVESTMENT PROFESSIONAL
OR, IF YOU PURCHASED YOUR
SHARES THROUGH A BROKER-DEALER
OR INSURANCE REPRESENTATIVE,
CALL 1-800-522-7297. IF YOU
PURCHASED YOUR SHARES THROUGH
A BANK REPRESENTATIVE,
CALL 1-800-843-3001.
TRUST (SMALL SOLID BULLET) THE TRUSTEE MUST SIGN THE LETTER
INDICATING CAPACITY AS TRUSTEE.
IF THE TRUSTEE'S NAME IS NOT
IN THE ACCOUNT REGISTRATION,
PROVIDE A COPY OF THE TRUST
DOCUMENT CERTIFIED WITHIN THE
LAST 60 DAYS.
BUSINESS OR
ORGANIZATION (SMALL SOLID BULLET) AT LEAST ONE PERSON AUTHORIZED
BY CORPORATE RESOLUTION TO ACT
ON THE ACCOUNT MUST SIGN THE
LETTER.
EXECUTOR,
ADMINISTRATOR,
CONSERVATOR/GUARDIAN (SMALL SOLID BULLET) FOR INSTRUCTIONS, CONTACT YOUR
INVESTMENT PROFESSIONAL OR,
IF YOU PURCHASED YOUR SHARES
THROUGH A BROKER-DEALER OR
INSURANCE REPRESENTATIVE,
CALL 1-800-522-7297. IF YOU
PURCHASED YOUR SHARES THROUGH
A BANK REPRESENTATIVE, CALL
1-800-843-3001.
WIRE
(WIRE_GRAPHIC)
ALL ACCOUNT TYPES
EXCEPT RETIREMENT (SMALL SOLID BULLET) YOU MUST SIGN UP FOR THE WIRE
FEATURE BEFORE USING IT. TO
VERIFY THAT IT IS IN PLACE,
CONTACT YOUR INVESTMENT
PROFESSIONAL OR, IF YOU
PURCHASED YOUR SHARES THROUGH
A BROKER-DEALER OR INSURANCE
REPRESENTATIVE, CALL
1-800-522-7297. IF YOU PURCHASED
YOUR SHARES THROUGH A BANK
REPRESENTATIVE, CALL
1-800-843-3001.
MINIMUM WIRE: $500.
(SMALL SOLID BULLET) YOUR WIRE REDEMPTION REQUEST
MUST BE RECEIVED IN PROPER
FORM BY THE TRANSFER AGENT
BEFORE 4:00 P.M. EASTERN TIME
FOR MONEY TO BE WIRED ON THE
NEXT BUSINESS DAY.
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INVESTOR SERVICES
Fidelity Advisor funds provide a variety of services to help you
manage your account.
INFORMATION SERVICES
STATEMENTS AND REPORTS that Fidelity sends to you include the
following:
(solid bullet) Confirmation statements (after every transaction,
except a reinvestment, that affects your account balance or your
account registration)
(solid bullet) Account statements (quarterly)
(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 your investment professional if you need additional
copies of financial reports and, prospectuses.
TRANSACTION SERVICES
EXCHANGE PRIVILEGE. You may sell your Class A or Class T shares and
buy the same class of shares of other Fidelity Advisor funds or Daily
Money Class shares of Treasury Fund, Prime Fund, and Tax-Exempt Fund
by telephone or in writing. You may sell your Class B shares and buy
Class B shares of other Fidelity Advisor funds or Advisor B Class
shares of Treasury Fund by telephone or in writing. You may sell your
Class C shares and buy Class C shares of other Fidelity Advisor funds
or Advisor C Class shares of Treasury Fund by telephone or in writing.
The shares you exchange will carry credit for any front-end sales
charge you previously paid in connection with their purchase.
Note that exchanges out of the fund are limited to four per calendar
year, and that they may have tax consequences for you. For details on
policies and restrictions governing exchanges, including circumstances
under which a shareholder's exchange privilege may be suspended or
revoked, see "Exchange Restrictions," page .
FIDELITY ADVISOR SYSTEMATIC WITHDRAWAL PROGRAM lets you set up
periodic redemptions from your Class A, Class T, Class B and Class C
account. Accounts with a value of $10,000 or more in Class A, Class T,
Class B and Class C shares are eligible for this program. Aggregate
redemptions per 12-month period from your Class B account may not
exceed 10% of the account value and are not subject to a CDSC. Because
of Class A's and Class T's front-end sales charge, you may not want to
set up a systematic withdrawal plan during a period when you are
buying Class A's or Class T's shares on a regular basis.
One easy way to pursue your financial goals is to invest money
regularly. Fidelity Advisor funds offer convenient services that let
you transfer money into your fund account, or between fund accounts,
automatically. While regular investment plans 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. Certain
restrictions apply for retirement accounts. Call your investment
professional for more information.
REGULAR INVESTMENT PLANS
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FIDELITY ADVISOR SYSTEMATIC INVESTMENT PROGRAM
TO MOVE MONEY FROM YOUR BANK ACCOUNT TO A FIDELITY ADVISOR FUND
MINIMUM MINIMUM
INITIAL ADDITIONAL FREQUENCY SETTING UP OR CHANGING
$1,000 $100 MONTHLY, BIMONTHLY,
QUARTERLY, (SMALL SOLID BULLET) FOR A NEW ACCOUNT, COMPLETE THE APPROPRIATE
SECTION ON THE APPLICATION.
OR SEMI-ANNUALLY (SMALL SOLID BULLET) FOR EXISTING ACCOUNTS, CALL YOUR INVESTMENT
PROFESSIONAL FOR AN APPLICATION.
(SMALL SOLID BULLET) TO CHANGE THE AMOUNT OR FREQUENCY OF YOUR
INVESTMENT, CONTACT YOUR INVESTMENT
PROFESSIONAL DIRECTLY OR, IF YOU PURCHASED YOUR
SHARES THROUGH A BROKER-DEALER OR INSURANCE
REPRESENTATIVE, CALL 1-800-522-7297. IF YOU
PURCHASED YOUR SHARES THROUGH A BANK
REPRESENTATIVE, CALL 1-800-843-3001. CALL
AT LEAST 10 BUSINESS DAYS PRIOR TO YOUR
NEXT SCHEDULED INVESTMENT DATE (20 BUSINESS
DAYS IF YOU PURCHASED YOUR SHARES THROUGH A
BANK).
TO DIRECT DISTRIBUTIONS FROM A FIDELITY DEFINED TRUST
TO CLASS T OF A FIDELITY ADVISOR FUND
MINIMUM MINIMUM
INITIAL ADDITIONAL SETTING UP OR CHANGING
NOT APPLICABLE NOT APPLICABLE (SMALL SOLID BULLET) FOR A NEW OR EXISTING ACCOUNT, ASK YOUR
INVESTMENT PROFESSIONAL FOR THE APPROPRIATE
ENROLLMENT FORM.
(SMALL SOLID BULLET) TO CHANGE THE FUND TO WHICH YOUR DISTRIBUTIONS
ARE DIRECTED, CONTACT YOUR INVESTMENT
PROFESSIONAL FOR INSTRUCTIONS.
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FIDELITY ADVISOR SYSTEMATIC EXCHANGE PROGRAM
TO MOVE MONEY FROM A FIDELITY MONEY MARKET FUND OR A FIDELITY ADVISOR
FUND TO ANOTHER FIDELITY ADVISOR FUND
MINIMUM
INITIAL FREQUENCY SETTING UP OR CHANGING
$100 MONTHLY, QUARTERLY, (SMALL SOLID BULLET) TO ESTABLISH, CALL YOUR INVESTMENT PROFESSIONAL
AFTER BOTH ACCOUNTS ARE OPENED.
SEMI-ANNUALLY, OR ANNUALLY (SMALL SOLID BULLET) TO CHANGE THE AMOUNT OR FREQUENCY OF YOUR
INVESTMENT, CONTACT YOUR INVESTMENT PROFESSIONAL
DIRECTLY OR, IF YOU PURCHASED YOUR SHARES
THROUGH A BROKER-DEALER OR INSURANCE
REPRESENTATIVE, CALL 1-800-522-7297.
IF YOU PURCHASED YOUR SHARES THROUGH A
BANK REPRESENTATIVE, CALL 1-800-843-3001.
(SMALL SOLID 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 OF
$1,000.
(SMALL SOLID BULLET) BOTH ACCOUNTS MUST HAVE THE SAME REGISTRATIONS
AND TAXPAYER ID NUMBERS.
(SMALL SOLID BULLET) CALL AT LEAST 2 BUSINESS DAYS PRIOR TO YOUR
NEXT SCHEDULED EXCHANGE DATE.
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SHAREHOLDER AND ACCOUNT POLICIES
DIVIDENDS, CAPITAL GAINS, AND TAXES
The fund distributes substantially all of its net investment income
and capital gains to shareholders each year. Normally, dividends are
distributed in December and January. Capital gains are normally
distributed in December and the fund may pay additional capital gains
after the close of the fiscal year.
DISTRIBUTION OPTIONS
When you open an account, specify on your account application how you
want to receive your distributions. The fund offers four options:
1. REINVESTMENT OPTION. Your dividend and capital gain distributions
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. INCOME-EARNED OPTION. Your capital gain distributions will be
automatically reinvested in additional shares of the same class of the
fund, but you will be sent a check for each dividend distribution.
3. CASH OPTION. You will be sent a check for your dividend and capital
gain distributions.
4. DIRECTED DIVIDENDS(registered trademark) PROGRAM. Your dividend
distributions will be automatically invested in the same class of
shares of another identically registered Fidelity Advisor fund. You
will be sent a check for your capital gain distributions or your
capital gain distributions will be automatically reinvested in
additional shares of the same class of the fund.
If you select distribution option 2, 3 or 4 and the U.S. Postal
Service does not deliver your checks, your election may be converted
to the Reinvestment Option. You will not receive interest on amounts
represented by uncashed distribution checks. To change your
distribution option, call your investment professional directly or, if
you purchased your shares through a broker-dealer or insurance
representative, call 1-800-522-7297. If you purchased your shares
through a bank representative, call 1-800-843-3001.
Shares purchased through reinvestment of dividend and capital gain
distributions are not subject to a sales charge. If you direct Class A
or Class T distributions to a class with a front-end sales charge, you
will not pay a sales charge on those purchases.
When Class A, Class T, Class B and Class C deducts a distribution from
its NAV, the reinvestment price is the applicable class's NAV at the
close of business that day. Distribution checks will be mailed within
seven days.
TAXES
As with any investment, you should consider how your investment in the
fund will be taxed. If your account is not a tax-advantaged retirement
account, you should be aware of these tax implications.
TAXES ON DISTRIBUTIONS. Distributions are subject to federal income
tax, and may also be subject to state or local taxes. If you live
outside the United States, your distributions could also be taxed by
the country in which you reside. Your distributions are taxable when
they are paid, whether you take them in cash or reinvest them.
However, distributions declared in December and paid in January are
taxable as if they were paid on December 31.
For federal tax purposes, the fund's income and short-term capital
gains are distributed as dividends and taxed as ordinary income;
capital gain distributions are taxed as long-term capital gains.
Every January, Fidelity will send you and the IRS a statement showing
the tax characterization of distributions paid to you in the previous
year.
TAXES ON TRANSACTIONS. Your redemptions - including exchanges - are
subject to capital gains tax. A capital gain or loss is the difference
between the cost of your shares and the price you receive when you
sell them.
Whenever you sell shares of the fund, Fidelity will send you a
confirmation statement showing how many shares you sold and at what
price.
You will also receive a consolidated transaction statement at least
quarterly. However, it is up to you or your tax preparer to determine
whether this sale resulted in a capital gain and, if so, the amount of
tax to be paid. BE SURE TO KEEP YOUR REGULAR ACCOUNT STATEMENTS; the
information they contain will be essential in calculating the amount
of your capital gains.
"BUYING A DIVIDEND." If you buy shares when the class has realized but
not yet distributed income or capital gains, you will pay the full
price for the shares and then receive a portion of the price back in
the form of a taxable distribution.
EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on the
fund and its investments, and these taxes generally will reduce the
fund's distributions.
There are tax requirements that all funds must follow in order to
avoid federal taxation. In its effort to adhere to these requirements,
the fund may have to limit its investment activity in some types of
instruments.
TRANSACTION DETAILS
THE FUND IS OPEN FOR BUSINESS EACH day the New York Stock Exchange
(NYSE) is open. FSC normally calculates each class's NAV and offering
price as of the close of business of the NYSE, normally 4:00 p.m.
Eastern time.
A CLASS'S NAV is the value of a single share. The NAV of each class is
computed by adding that class's pro rata share of the value of the
fund's investments, cash, and other assets, subtracting that class's
pro rata share of the value of the fund's liabilities, subtracting the
liabilities allocated to that class, and dividing the result by the
number of shares of that class that are outstanding.
The fund's assets are valued primarily on the basis of market
quotations. Short-term securities with remaining maturities of sixty
days or less for which quotations are not readily available are valued
on the basis of amortized cost. This method minimizes the effect of
changes in a security's market value. Foreign securities are valued on
the basis of quotations from the primary market in which they are
traded, and are translated from the local currency into U.S. dollars
using current exchange rates. In addition, if quotations are not
readily available, or if the values have been materially affected by
events occurring after the closing of a foreign market, assets may be
valued by another method that the Board of Trustees believes
accurately reflects fair value.
THE OFFERING PRICE of Class A or Class T is its NAV divided by the
difference between one and the applicable front-end sales charge
percentage. Class A has a maximum front-end sales charge of 5.75% of
the offering price for Small Cap; Class T has a maximum front-end
sales charge of 3.50% of the offering price for Small Cap.
SALES CHARGES AND INVESTMENT PROFESSIONAL CONCESSIONS - CLASS A
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SALES CHARGE: INVESTMENT
PROFESSIONAL
CONCESSION AS % OF
OFFERING PRICE
AS A % OF AS AN
OFFERING PRICE APPROXIMATE %
OF NET AMOUNT
INVESTED
UP TO $49,999 5.75% 6.10% 5.00%
$50,000 TO $99,999 4.50% 4.71% 3.75%
$100,000 TO $249,999 3.50% 3.63% 2.75%
$250,000 TO $499,999 2.50% 2.56% 2.00%
$500,000 TO $999,999 2.00% 2.04% 1.75%
$1,000,000 TO $24,999,999 1.00% 1.01% 0.75%
$25,000,000 OR MORE NONE* NONE* *
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* SEE SECTION ENTITLED FINDER'S FEE.
SALES CHARGES AND INVESTMENT PROFESSIONAL CONCESSIONS - CLASS T
SALES CHARGE: INVESTMENT
PROFESSIONAL
CONCESSION AS % OF
OFFERING PRICE
AS A % OF AS AN
OFFERING PRICE APPROXIMATE %
OF NET AMOUNT
INVESTED
UP TO $49,999 3.50% 3.63% 3.00%
$50,000 TO $99,999 3.00% 3.09% 2.50%
$100,000 TO $249,999 2.50% 2.56% 2.00%
$250,000 TO $499,999 1.50% 1.52% 1.25%
$500,000 TO $999,999 1.00% 1.01% 0.75%
$1,000,000 OR MORE NONE* NONE* *
* SEE SECTION ENTITLED FINDER'S FEE.
FINDER'S FEE. On eligible purchases of (i) Class A shares in amounts
of $1 million or more that qualify for a Class A load waiver, (ii)
Class A shares in amounts of $25 million or more, and (iii) Class T
shares in amounts of $1 million or more, investment professionals will
be compensated with a fee at the rate of 0.25% of the purchase amount.
Any assets on which a finder's fee has been paid will bear a
contingent deferred sales charge (Class A or Class T CDSC) if they do
not remain in Class A or Class T shares of the Fidelity Advisor funds,
or Daily Money Class shares of Treasury Fund, Prime Fund, or
Tax-Exempt Fund, for a period of at least one uninterrupted year. The
Class A or Class T CDSC will be 0.25% of the lesser of the cost of the
Class A or Class T shares, as applicable, at the initial date of
purchase or the value of the Class A or Class T shares as applicable,
at redemption, not including any reinvested dividends or capital
gains. Class A and Class T shares acquired through distributions
(dividends or capital gains) will not be subject to a Class A or Class
T CDSC. In determining the applicability and rate of any Class A or
Class T CDSC at redemption, Class A or Class T shares representing
reinvested dividends and capital gains, if any, will be redeemed
first, followed by those Class A or Class T CDSC shares that have been
held for the longest period of time.
Shares held by an insurance company separate account will be
aggregated at the client (e.g., the contract holder or plan sponsor)
level, not at the separate account level. Upon request, anyone
claiming eligibility for the 0.25% fee with respect to shares held by
an insurance company separate account must provide FDC access to
records detailing purchases at the client level.
With respect to employee benefit plans, the Class A or Class T CDSC
does not apply to the following types of redemptions; (i) plan loans
or distributions or (ii) exchanges to non-Advisor fund investment
options. With respect to Individual Retirement Accounts, the Class A
or Class T CDSC does not apply to redemptions made for disability,
payment of death benefits, or required partial distributions starting
at age 701/2. Your investment professional should advise Fidelity at
the time your redemption order is placed if you qualify for a waiver
of the Class A or Class T CDSC.
Investment professionals must notify FDC in advance of a purchase
eligible for a finder's fee, and may be required to enter into an
agreement with FDC in order to receive the finder's fee.
CONTINGENT DEFERRED SALES CHARGE. Class B shares may, upon redemption,
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 YEARS 4%
2 YEARS TO LESS THAN 3 YEARS 3%
3 YEARS TO LESS THAN 4 YEARS 3%
4 YEARS TO LESS THAN 5 YEARS 2%
5 YEARS TO LESS THAN 6 YEARS 1%
6 YEARS TO LESS THAN 7 YEARS [A] 0%
[A] AFTER A HOLDING PERIOD OF SEVEN YEARS, CLASS B SHARES WILL CONVERT
AUTOMATICALLY TO CLASS A SHARES OF THE SAME FIDELITY ADVISOR FUND. SEE
"CONVERSION FEATURE" BELOW FOR MORE INFORMATION.
When exchanging Class B shares of one fund for Class B shares of
another Fidelity Advisor fund or Advisor B Class shares of Treasury
Fund, your Class B shares retain the CDSC schedule in effect when they
were originally purchased.
Except as provided below, investment professionals with whom
FDC has agreements receive as compensation from FDC a concession equal
to 4.00% of your purchase of Class B shares. For purchases of Class
B shares through reinvested dividends or capital gain 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 with whom FDC has
agreements receive as compensation from FDC, at the time of the 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 reinvested dividends or capital gain 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. Class B and Class C shares
acquired through distributions (dividends or capital gains) 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.
CONVERSION FEATURE. After a holding period of seven years from the
initial date of purchase, Class B shares and any capital appreciation
associated with those shares, convert automatically to Class A shares
of the same Fidelity Advisor fund. Conversion to Class A 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 (Dividend Shares) will also convert to Class A 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.
For more information about the CDSC, including the conversion feature
and the permitted circumstances for CDSC waivers, contact your
investment professional.
REINSTATEMENT PRIVILEGE. If you have sold all or part of your Class A,
Class T, Class B and Class C shares of the fund, you may reinvest an
amount equal to all or a portion of the redemption proceeds in the
same class of the fund or any of the other Fidelity Advisor funds, 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, if any, you paid on Class A, Class T, Class B and Class C
shares will be reimbursed to you by reinvesting that amount in Class
A, Class T, Class B and Class C shares, as applicable. You must
reinstate your 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
holding period schedule, the holding period of your Class A, Class T,
Class B and Class C shares will continue as if the shares had not been
redeemed.
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.
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 redeem and
exchange by telephone, call Fidelity for instructions. Additional
documentation may be required from corporations, associations, and
certain fiduciaries.
IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during
periods of unusual market activity), consider placing your order by
mail.
THE FUND RESERVES THE RIGHT to suspend the offering of shares for a
period of time.
WHEN YOU PLACE AN ORDER TO BUY SHARES, your shares will be purchased
at the next offering price or NAV, as applicable, calculated after
your order is received in proper form. Note the following:
(small solid bullet) All of your purchases must be made in U.S.
dollars and checks must be drawn on U.S. banks.
(small solid bullet) Fidelity does not accept cash.
(small solid bullet) The fund 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) The fund 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.
AUTOMATED PURCHASE ORDERS. Class A, Class T, Class B and Class C
shares can be purchased or sold through investment professionals
utilizing an automated order placement and settlement system that
guarantees payment for orders on a specified date.
CONFIRMED PURCHASES. Certain financial institutions that meet FDC's
creditworthiness criteria may enter confirmed purchase orders on
behalf of customers by phone, with payment to follow no later than
close of business on the next business day. If payment is not received
by the next business day, the order will be canceled and the financial
institution will be liable for any losses.
TO AVOID THE COLLECTION PERIOD associated with check purchases,
consider buying shares by bank wire, U.S. Postal money order, U.S.
Treasury check, Federal Reserve check, or automatic investment plans.
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at
the next NAV calculated after your order is received in proper form,
minus any applicable CDSC. Note the following:
(small solid bullet) Normally, redemption proceeds will be mailed to
you on the next business day, but if making immediate payment could
adversely affect the fund, it may take up to seven days to pay you.
(small solid bullet) The fund may hold payment on redemptions until it
is reasonably satisfied that investments made by check have been
collected, which can take up to seven business days.
(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.
The fund reserves the right to impose a trading fee on redemptions and
exchanges from the fund.
FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of
$12.00 from accounts with a value of less than $2,500 (including any
amount paid as a sales charge), subject to an annual maximum charge of
$60.00 per shareholder. Accounts opened after September 30 will not be
subject to the fee for that year. The fee, which is payable to the
transfer agent, is designed to offset in part the relatively higher
costs of servicing smaller accounts. The fee will not be deducted from
retirement accounts (except non-prototype retirement accounts),
accounts using a systematic investment program, certain (Network Level
I and III) accounts which are maintained through National Securities
Clearing Corporation (NSCC), or if total assets in Fidelity mutual
funds exceed $50,000. Eligibility for the $50,000 waiver is determined
by aggregating Fidelity mutual fund accounts (excluding contractual
plans) maintained (i) by FIIOC and (ii) through NSCC; provided those
accounts are registered under the same primary social security number.
IF YOUR NON-RETIREMENT ACCOUNT BALANCE FALLS BELOW $1,000, you will be
given 30 days' notice to reestablish the minimum balance. If you do
not increase your balance, Fidelity reserves the right to close your
account and send the proceeds to you. Your shares will be redeemed 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.
FDC will, at its expense, provide promotional incentives such as sales
contests and luxury trips to investment professionals who support the
sale of shares of the funds. In some instances, these incentives will
be offered only to certain types of investment professionals, such as
bank-affiliated or non-bank affiliated broker-dealers, or to
investment professionals whose representatives provide services in
connection with the sale or expected sale of significant amounts of
shares.
EXCHANGE RESTRICTIONS
As a shareholder, you have the privilege of exchanging Class A, Class
T, Class B, or Class C shares of the fund for the same class of shares
of other Fidelity Advisor funds; Class A or Class T shares for Daily
Money Class shares of Treasury Fund, Prime Fund, or Tax-Exempt Fund;
Class B shares for Advisor B Class shares of Treasury Fund; and Class
C shares for Advisor C Class Shares of Treasury Fund. If you purchased
your Class T shares through certain investment professionals that have
signed an agreement with FDC, you also have the privilege of
exchanging your Class T shares for shares of Fidelity Capital
Appreciation Fund. However, you should note the following:
(small solid bullet) The fund or class you are exchanging into must be
available for sale in your state.
(small solid bullet) You may only exchange between accounts that are
registered in the same name, address, and taxpayer identification
number.
(small solid bullet) Before exchanging into a fund or class, read its
prospectus.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) T he fund reserves the right to temporarily
or permanently terminate the exchange privilege of any investor who
makes more than four exchanges out of the fund per calendar year.
Accounts under common ownership or control, including accounts with
the same taxpayer identification number, will be counted together for
purposes of the four exchange limit.
(small solid bullet) The fund reserves the right to refuse exchange
purchases by any person or group if, in FMR's judgment, the fund would
be unable to invest the money effectively in accordance with its
investment objective and policies, or would otherwise potentially be
adversely affected.
(small solid bullet) The exchange limit may be modified for accounts
in certain institutional retirement plans to conform to plan exchange
limits and Department of Labor regulations. See your plan materials
for further information.
(small solid bullet) Any exchanges of Class A, Class T, Class B, or
Class C shares are not subject to a CDSC.
Although the fund will attempt to give you prior notice whenever it is
reasonably able to do so, it may impose these restrictions at any
time. The fund reserves the right to 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.
SALES CHARGE REDUCTIONS AND WAIVERS
If your purchase qualifies for one of the following sales charge
reduction plans, the front-end sales charge will be reduced for
purchases of Class A/Class T shares according to the Sales Charge
schedule shown on page 49 . Please refer to the fund's SAI for
more details about each plan or call your investment professional.
If you purchased your shares through a broker-dealer or insurance
representative, call 1-800-522-7297. If you purchased your shares
through a bank representative, call 1-800-843-3001.
Your purchases and existing balances of Class A, Class T, Class B, and
Class C shares may be included in the following programs for purposes
of qualifying for a Class A or Class T front-end sales charge
reduction.
QUANTITY DISCOUNTS apply to purchases of Class A or Class T shares of
a single Fidelity Advisor fund or to combined purchases of (i) Class
A, Class T, Class B, and Class C shares of any Fidelity Advisor fund,
(ii) Advisor B Class shares and Advisor C Class shares of Treasury
Fund, and (iii) Daily Money Class shares of Treasury Fund, Prime Fund,
and Tax-Exempt Fund acquired by exchange from any Fidelity Advisor
fund. The minimum investment eligible for a quantity discount is
$50,000, except that the minimum investment for the Advisor Short-Term
Bond Funds is $500,000.
To qualify for a quantity discount, investing in the fund's Class A,
Class T, Class B and Class C shares for several accounts at the same
time will be considered a single transaction (Combined Purchase), as
long as shares are purchased through one investment professional and
the total is at least $50,000 (or at least $500,000 for the Advisor
Short-Term Bond Funds).
RIGHTS OF ACCUMULATION let you determine your front-end sales charge
on Class A and Class T shares by adding to your new purchase of Class
A and Class T shares the value of all of the Fidelity Advisor fund
Class A, Class T, Class B, and Class C shares held by you, your
spouse, and your children under age 21. You can also add the value of
Advisor B Class shares and Advisor C Class shares of Treasury Fund and
Daily Money Class shares of Treasury Fund, Prime Fund, and Tax-Exempt
Fund acquired by exchange from any Fidelity Advisor fund.
A LETTER OF INTENT (the Letter) lets you receive the same reduced
front-end sales charge on purchases of Class A and Class T shares made
during a 13-month period as if the total amount invested during the
period had been invested in a single lump sum. (see Quantity Discounts
above.) Purchases of Class B and Class C shares during the 13-month
period will count toward the completion of your letter. You must file
your non-binding Letter with Fidelity within 90 days of the start of
your purchases. Your initial investment must be at least 5% of the
amount you plan to invest. Out of the initial investment, Class A or
Class T shares equal to 5% of the dollar amount specified in the
Letter will be registered in your name and held in escrow. You will
earn income dividends and capital gain distributions on escrowed Class
A and Class T shares. Reinvested income and capital gain distributions
do not count toward the completion of the Letter. The escrow will be
released when your purchase of the total amount has been completed.
You are not obligated to complete the Letter, and in such a case,
sufficient escrowed Class A or Class T shares will be redeemed to pay
any applicable front-end sales charges.
A FRONT-END SALES CHARGE WILL NOT APPLY TO THE FOLLOWING CLASS A
SHARES:
1. Purchased for an insurance company separate account used to fund
annuity contracts for employee benefit plans;
2. Purchased by a trust institution or bank trust department for a
managed account that is charged an asset-based fee. Employee benefit
plans and accounts managed by third parties do not qualify for this
waiver;
3. Purchased by a broker-dealer for a managed account that is charged
an asset-based fee. Employee benefit plans do not qualify for this
waiver;
4. Purchased by a registered investment advisor that is not part of an
organization primarily engaged in the brokerage business for an
account that is managed on a discretionary basis and is charged an
asset-based fee. Employee benefit plan assets do not qualify for this
waiver;
5. Purchased for (i) an employee benefit plan that has $25 million or
more in plan assets or (ii) an employee benefit plan that is part of
an investment professional sponsored program that requires the
participating employee benefit plan to initially inves t in
Class C or Class B shares and upon meeting certain criteria,
subsequently requires the plan to invest in Class A shares; or
6. Purchased prior to December 31, 1998 by shareholders who have
closed their Class A Municipal Bond, Class A California Municipal
Income, or Class A New York Municipal Income accounts prior to
December 31, 1997. This waiver is limited to purchases of up to
$10,000; shareholders are entitled to this waiver after the original
load waiver certificate is received in proper form by FIIOC.
A FRONT-END SALES CHARGE WILL NOT APPLY TO THE FOLLOWING CLASS T
SHARES:
1. Purchased for an insurance company separate account used to fund
annuity contracts for employee benefit plans;
2. Purchased by a trust institution or bank trust department for a
managed account that is charged and an asset-based fee. Accounts
managed by third parties do not qualify for this waiver;
3. Purchased by a broker-dealer for a managed account that is charged
an asset-based fee;
4. Purchased by a registered investment advisor that is not part of an
organization primarily engaged in the brokerage business for an
account that is managed on a discretionary basis and is charged an
asset-based fee;
5. Purchased for an employee benefit plan, except certain small
employer retirement plans;
6. Purchased for a Fidelity or Fidelity Advisor account with the
proceeds of a distribution from (i) an insurance company separate
account used to fund annuity contracts for employee benefit plans that
are invested in Fidelity Advisor or Fidelity funds, or (ii) an
employee benefit plan that is invested in Fidelity Advisor or Fidelity
funds. (Distributions other than those transferred to an IRA account
must be transferred directly into a Fidelity account);
7. Purchased for any state, county, or city, or any governmental
instrumentality, department, authority or agency;
8. Purchased with redemption proceeds from other mutual fund complexes
on which you have previously paid a front-end sales charge or CDSC;
9. Purchased by a current or former trustee or officer of a Fidelity
fund or a current or retired officer, director or regular employee of
FMR Corp. or FIL or their direct or indirect subsidiaries (a Fidelity
trustee or employee), the spouse of a Fidelity trustee or employee, a
Fidelity trustee or employee acting as custodian for a minor child, or
a person acting as trustee of a trust for the sole benefit of the
minor child of a Fidelity trustee or employee;
10. Purchased by a charitable organization (as defined for purposes of
Section 501(c)(3) of the Internal Revenue Code) investing $100,000 or
more;
11. Purchased by a bank trust officer, registered representative, or
other employee (or a member of one of their immediate families) of
investment professionals having agreements with FDC;
12. Purchased for a charitable remainder trust or life income pool
established for the benefit of a charitable organization (as defined
for purposes of Section 501(c)(3) of the Internal Revenue Code);
13. Purchased with distributions of income, principal, and capital
gains from Fidelity Defined Trusts; or
14. Purchased prior to December 31, 1998 by shareholders who have
closed their Class T Municipal Bond, Class T California Municipal
Income, or Class T New York Municipal Income accounts prior to
December 31, 1997. This waiver is limited to purchases of up to
$10,000; shareholders are entitled to this waiver after the original
load waiver certificate is received in proper form by FIIOC.
You must notify FDC in advance if you qualify for a front-end sales
charge waiver. Employee benefit plan investors must meet additional
requirements specified in the funds' SAI.
If you are investing through an insurance company separate account, if
you are investing through a trust department, if you are investing
through an account managed by a broker-dealer, or if you have
authorized an investment adviser to make investment decisions for you,
you may qualify to purchase Class A shares without a sales charge (as
described in (1), (2), (3) and (4) on the previous page), Class T
shares without a sales charge (as described in (1), (2), (3) and (4)
on the previous page), or Institutional Class shares. Because
Institutional Class shares have no sales charge, and do not pay a
12b-1 fee, Institutional Class shares are expected to have a higher
total return than Class A, Class T, Class B, and Class C shares.
Contact your investment professional to discuss if you qualify.
THE CDSC ON CLASS B AND CLASS C SHARES MAY BE WAIVED:
1. In cases 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 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.
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.
Your investment professional should call Fidelity for more
information.
No dealer, sales representative, or any other person has been
authorized to give any information or to make any representations,
other than those contained in this Prospectus and in the related SAI,
in connection with the offer contained in this Prospectus. If given or
made, such other information or representations must not be relied
upon as having been authorized by the fund or FDC. This Prospectus and
the related SAI do not constitute an offer by the fund or by FDC to
sell or to buy shares of the fund to any person to whom it is unlawful
to make such offer.
Fidelity, Fidelity Investments & (Pyramid) Design, Fidelity
Investments, and Directed Dividends are registered trademarks of FMR
Corp.
Portfolio Advisory Services is a service mark of FMR Corp.
Fidelity Advisor Series I:
Fidelity Advisor Small Cap Fund
Class A, Class T, Class B, Class C, and Institutional Class
Statement of Additional Information
Cross Reference Sheet
<TABLE>
<CAPTION>
<S> <C>
FORM N-1A ITEM NUMBER STATEMENT OF ADDITIONAL INFORMATION SECTION
10 COVER PAGE
11 COVER PAGE
12 DESCRIPTION OF THE TRUST
13 A-C INVESTMENT POLICIES AND LIMITATIONS
D PORTFOLIO TRANSACTIONS
14 A-C TRUSTEES AND OFFICERS
15 A-C TRUSTEES AND OFFICERS
16 A I FMR
II TRUSTEES AND OFFICERS
III MANAGEMENT CONTRACT
B MANAGEMENT CONTRACT
C *
D CONTRACTS WITH FMR AFFILIATES
E *
F DISTRIBUTION AND SERVICE PLANS
G *
H DESCRIPTION OF THE TRUST
I CONTRACTS WITH FMR AFFILIATES
17 A PORTFOLIO TRANSACTIONS
B *
C PORTFOLIO TRANSACTIONS
D *
E *
18 A DESCRIPTION OF THE TRUST
B *
19 A ADDITIONAL PURCHASE, EXCHANGE, AND REDEMPTION
INFORMATION
B VALUATION; ADDITIONAL PURCHASE, EXCHANGE, AND
REDEMPTION INFORMATION
C *
20 DISTRIBUTIONS AND TAXES
21 A CONTRACTS WITH FMR AFFILIATES; DISTRIBUTION AND SERVICE
PLANS
B *
C *
22 A *
B *
23 *
</TABLE>
_____________
*Not Applicable
FIDELITY ADVISOR SMALL CAP FUND
A FUND OF FIDELITY ADVISOR SERIES I
CLASS A, CLASS T, CLASS B, CLASS C, AND INSTITUTIONAL CLASS
STATEMENT OF ADDITIONAL INFORMATION
SEPTEMBER 6, 1998
This Statement of Additional Information (SAI) is not a prospectus but
should be read in conjunction with the fund's current Prospectuses
(dated September 6, 1998) for Class A, Class T, Class B, Class C, and
Institutional Class shares. Please retain this document for future
reference. To obtain a free additional copy of a Prospectus, please
call your investment professional.
TABLE OF CONTENTS PAGE
INVESTMENT POLICIES AND LIMITATIONS 54
PORTFOLIO TRANSACTIONS 59
VALUATION 60
PERFORMANCE 60
ADDITIONAL PURCHASE, EXCHANGE AND REDEMPTION INFORMATION 61
DISTRIBUTIONS AND TAXES 64
FMR 65
TRUSTEES AND OFFICERS 65
MANAGEMENT CONTRACT 68
DISTRIBUTION AND SERVICE PLANS 70
CONTRACTS WITH FMR AFFILIATES 70
DESCRIPTION OF THE TRUST 71
APPENDIX 71
INVESTMENT ADVISER
Fidelity Management & Research Company (FMR)
INVESTMENT SUB-ADVISERS
Fidelity Management & Research (U.K.) Inc. (FMR U.K.)
Fidelity Management & Research (Far East) Inc. (FMR Far East)
DISTRIBUTOR
Fidelity Distributors Corporation (FDC)
TRANSFER AGENT
Fidelity Investments Institutional Operations Company (FIIOC)
ASCF- ptb -0998
70 6798
1.2.INVESTMENT POLICIES AND LIMITATIONS
The following policies and limitations supplement those set forth in
the Prospectus. Unless otherwise noted, whenever an investment policy
or limitation states a maximum percentage of the fund's assets that
may be invested in any security or other asset, or sets forth a policy
regarding quality standards, such standard or percentage limitation
will be determined immediately after and as a result of the fund's
acquisition of such security or other asset. Accordingly, any
subsequent change in values, net assets, or other circumstances will
not be considered when determining whether the investment complies
with the fund's investment policies and limitations.
The fund's fundamental investment policies and limitations cannot be
changed without approval by a "majority of the outstanding voting
securities" (as defined in the Investment Company Act of 1940 (the
1940 Act)) of the fund. However, except for the fundamental investment
limitations listed below, the investment policies and limitations
described in this SAI are not fundamental and may be changed without
shareholder approval.
THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET
FORTH IN THEIR ENTIRETY. THE FUND MAY NOT:
(1) with respect to 75% of the fund's total assets, purchase the
securities of any issuer (other than securities issued or guaranteed
by the U.S. Government or any of its agencies or instrumentalities, or
securities of other investment companies) if, as a result, (a) more
than 5% of the fund's total assets would be invested in the securities
of that issuer, or (b) the fund would hold more than 10% of the
outstanding voting securities of that issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) borrow money, except that the fund may borrow money for temporary
or emergency purposes (not for leveraging or investment) in an amount
not exceeding 33 1/3% of its total assets (including the amount
borrowed) less liabilities (other than borrowings). Any borrowings
that come to exceed this amount will be reduced within three days (not
including Sundays and holidays) to the extent necessary to comply with
the 33 1/3% limitation;
(4) underwrite securities issued by others, except to the extent that
the fund may be 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 (but this shall not
prevent the fund from purchasing or selling options and futures
contracts or from investing in securities or other instruments backed
by physical commodities); 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 managed by Fidelity
Management & Research Company or an affiliate or successor with
substantially the same fundamental investment objective, policies, and
limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to sell securities short,
unless it owns or has the right to obtain securities equivalent in
kind and amount to the securities sold short, and provided that
transactions in futures contracts and options are not deemed to
constitute selling securities short.
(ii) The fund does not currently intend to purchase securities on
margin, except that the fund may obtain such short-term credits as are
necessary for the clearance of transactions, and provided that margin
payments in connection with futures contracts and options on futures
contracts shall not constitute purchasing securities on margin.
(iii) The fund may borrow money only (a) from a bank or from a
registered investment company or portfolio for which FMR or an
affiliate serves as investment adviser or (b) by engaging in reverse
repurchase agreements with any party (reverse repurchase agreements
are treated as borrowings for purposes of fundamental investment
limitation (3)). The fund will not borrow from other funds advised by
FMR or its affiliates if total outstanding borrowings immediately
after such borrowing would exceed 15% of the fund's total assets.
(iv) The fund does not currently intend to purchase any security if,
as a result, more than 10% of its net assets would be invested in
securities that are deemed to be illiquid because they are subject to
legal or contractual restrictions on resale or because they cannot be
sold or disposed of in the ordinary course of business at
approximately the prices at which they are valued.
(v) The fund does not currently intend to lend assets other than
securities to other parties, except by (a) lending money (up to 5% of
the fund's net assets) to a registered investment company or portfolio
for which FMR or an affiliate serves as investment adviser or (b)
acquiring loans, loan participations, or other forms of direct debt
instruments and, in connection therewith, assuming any associated
unfunded commitments of the sellers. (This limitation does not apply
to purchases of debt securities or to repurchase agreements.)
(vi) The fund does not currently intend to invest all of its assets in
the securities of a single open-end management investment company
managed by Fidelity Management & Research Company or an affiliate or
successor with substantially the same fundamental investment
objective, policies, and limitations as the fund.
With respect to limitation (iv), if through a change in values, net
assets, or other circumstances, the fund were in a position where more
than 10% of its net assets was invested in illiquid securities, it
would consider appropriate steps to protect liquidity
For the fund's limitations on futures and options transactions, see
the section entitled "Limitations on Futures and Options Transactions"
on page .
The following pages contain more detailed information about types of
instruments in which the fund may invest, strategies FMR may employ in
pursuit of the fund's investment objective, and a summary of related
risks. FMR may not buy all of these instruments or use all of these
techniques unless it believes that doing so will help the fund achieve
its goal.
AFFILIATED BANK TRANSACTIONS. A fund may engage in transactions with
financial institutions that are, or may be considered to be,
"affiliated persons" of the fund under the 1940 Act. These
transactions may involve repurchase agreements with custodian banks;
short-term obligations of, and repurchase agreements with, the 50
largest U.S. banks (measured by deposits); municipal securities; U.S.
Government securities with affiliated financial institutions that are
primary dealers in these securities; short-term currency transactions;
and short-term borrowings. In accordance with exemptive orders issued
by the Securities and Exchange Commission (SEC), the Board of Trustees
has established and periodically reviews procedures applicable to
transactions involving affiliated financial institutions.
CLOSED-END INVESTMENT COMPANIES are investment companies that issue a
fixed number of shares which trade on a stock exchange or
over-the-counter. Closed-end investment companies are professionally
managed and may invest in any type of security. Shares of closed-end
investment companies may trade at a premium or a discount to their net
asset value. A fund may purchase shares of closed-end investment
companies to facilitate investment in certain foreign countries.
CONVERTIBLE SECURITIES are bonds, debentures, notes, preferred stocks
or other securities that may be converted or exchanged (by the holder
or by the issuer) into shares of the underlying common stock (or cash
or securities of equivalent value) at a stated exchange ratio. A
convertible security may also be called for redemption or conversion
by the issuer after a particular date and under certain circumstances
(including a specified price) established upon issue. If a convertible
security held by a fund is called for redemption or conversion, the
fund could be required to tender it for redemption, convert it into
the underlying common stock, or sell it to a third party.
Convertible securities generally have less potential for gain or loss
than common stocks. Convertible securities generally provide yields
higher than the underlying common stocks, but generally lower than
comparable non-convertible securities. Because of this higher yield,
convertible securities generally sell at prices above their
"conversion value," which is the current market value of the stock to
be received upon conversion. The difference between this conversion
value and the price of convertible securities will vary over time
depending on changes in the value of the underlying common stocks and
interest rates. When the underlying common stocks decline in value,
convertible securities will tend not to decline to the same extent
because of the interest or dividend payments and the repayment of
principal at maturity for certain types of convertible securities.
However, securities that are convertible other than at the option of
the holder generally do not limit the potential for loss to the same
extent as securities convertible at the option of the holder. When the
underlying common stocks rise in value, the value of convertible
securities may also be expected to increase. At the same time,
however, the difference between the market value of convertible
securities and their conversion value will narrow, which means that
the value of convertible securities will generally not increase to the
same extent as the value of the underlying common stocks. Because
convertible securities may also be interest-rate sensitive, their
value may increase as interest rates fall and decrease as interest
rates rise. Convertible securities are also subject to credit risk,
and are often lower-quality securities.
EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies,
and securities issued by U.S. entities with substantial foreign
operations may involve significant risks in addition to the risks
inherent in U.S. investments.
Foreign investments involve risks relating to local political,
economic, regulatory, or social instability, military action or
unrest, or adverse diplomatic developments, and may be affected by
actions of foreign governments adverse to the interests of U.S.
investors. Such actions may include expropriation or nationalization
of assets, confiscatory taxation, restrictions on U.S. investment or
on the ability to repatriate assets or convert currency into U.S.
dollars, or other government intervention. There is no assurance that
FMR will be able to anticipate these potential events or counter their
effects. In addition, the value of securities denominated in foreign
currencies and of dividends and interest paid with respect to such
securities will fluctuate based on the relative strength of the U.S.
dollar.
It is anticipated that in most cases the best available market for
foreign securities will be on an exchange or in over-the-counter (OTC)
markets located outside of the United States. Foreign stock markets,
while growing in volume and sophistication, are generally not as
developed as those in the United States, and securities of some
foreign issuers may be less liquid and more volatile than securities
of comparable U.S. issuers. Foreign security trading, settlement and
custodial practices (including those involving securities settlement
where fund assets may be released prior to receipt of payment) are
often less developed than those in U.S. markets, and may result in
increased risk or substantial delays in the event of a failed trade or
the insolvency of, or breach of duty by, a foreign broker-dealer,
securities depository or foreign subcustodian. In addition, the costs
associated with foreign investments, including withholding taxes,
brokerage commissions and custodial costs, are generally higher than
with U.S. investments.
Foreign markets may offer less protection to investors than U.S.
markets. Foreign issuers are generally not bound by uniform
accounting, auditing, and financial reporting requirements and
standards of practice comparable to those applicable to U.S. issuers.
Adequate public information on foreign issuers may not be available,
and it may be difficult to secure dividends and information regarding
corporate actions on a timely basis. In general, there is less overall
governmental supervision and regulation of securities exchanges,
brokers, and listed companies than in the United States. OTC markets
tend to be less regulated than stock exchange markets and, in certain
countries, may be totally unregulated. Regulatory enforcement may be
influenced by economic or political concerns, and investors may have
difficulty enforcing their legal rights in foreign countries.
Some foreign securities impose restrictions on transfer within the
United States or to U.S. persons. Although securities subject to such
transfer restrictions may be marketable abroad, they may be less
liquid than foreign securities of the same class that are not subject
to such restrictions.
American Depositary Receipts (ADRs) as well as other "hybrid" forms of
ADRs, including European Depositary Receipts (EDRs) and Global
Depositary Receipts (GDRs), are certificates evidencing ownership of
shares of a foreign issuer. These certificates are issued by
depository banks and generally trade on an established market in the
United States or elsewhere. The underlying shares are held in trust by
a custodian bank or similar financial institution in the issuer's home
country. The depository bank may not have physical custody of the
underlying securities at all times and may charge fees for various
services, including forwarding dividends and interest and corporate
actions. ADRs are alternatives to directly purchasing the underlying
foreign securities in their national markets and currencies. However,
ADRs continue to be subject to many of the risks associated with
investing directly in foreign securities. These risks include foreign
exchange risk as well as the political and economic risks of the
underlying issuer's country.
The risks of foreign investing may be magnified for investments in
emerging markets. Security prices in emerging markets can be
significantly more volatile than those in more developed markets,
reflecting the greater uncertainties of investing in less established
markets and economies. In particular, countries with emerging markets
may have relatively unstable governments, may present the risks of
nationalization of businesses, restrictions on foreign ownership and
prohibitions on the repatriation of assets, and may have less
protection of property rights than more developed countries. The
economies of countries with emerging markets may be based on only a
few industries, may be highly vulnerable to changes in local or global
trade conditions, and may suffer from extreme and volatile debt
burdens or inflation rates. Local securities markets may trade a small
number of securities and may be unable to respond effectively to
increases in trading volume, potentially making prompt liquidation of
holdings difficult or impossible at times.
FOREIGN CURRENCY TRANSACTIONS. A fund may conduct foreign currency
transactions on a spot (i.e., cash) or forward basis (i.e., by
entering into forward contracts to purchase or sell foreign
currencies). Although foreign exchange dealers generally do not charge
a fee for such conversions, they do realize a profit based on the
difference between the prices at which they are buying and selling
various currencies. Thus, a dealer may offer to sell a foreign
currency at one rate, while offering a lesser rate of exchange should
the counterparty desire to resell that currency to the dealer. Forward
contracts are customized transactions that require a specific amount
of a currency to be delivered at a specific exchange rate on a
specific date or range of dates in the future. Forward contracts are
generally traded in an interbank market directly between currency
traders (usually large commercial banks) and their customers. The
parties to a forward contract may agree to offset or terminate the
contract before its maturity, or may hold t he contract to
maturity and complete the contemplated currency exchange.
The following discussion summarizes the principal currency management
strategies involving forward contracts that could be used by a fund. A
fund may also use swap agreements, indexed securities, and options and
futures contracts relating to foreign currencies for the same
purposes.
A "settlement hedge" or "transaction hedge" is designed to protect a
fund against an adverse change in foreign currency values between the
date a security is purchased or sold and the date on which payment is
made or received. Entering into a forward contract for the purchase or
sale of the amount of foreign currency involved in an underlying
security transaction for a fixed amount of U.S. dollars "locks in" the
U.S. dollar price of the security. Forward contracts to purchase or
sell a foreign currency may also be used by a fund in anticipation of
future purchases or sales of securities denominated in foreign
currency, even if the specific investments have not yet been selected
by FMR.
A fund may also use forward contracts to hedge against a decline in
the value of existing investments denominated in foreign currency. For
example, if a fund owned securities denominated in pounds sterling, it
could enter into a forward contract to sell pounds sterling in return
for U.S. dollars to hedge against possible declines in the pound's
value. Such a hedge, sometimes referred to as a "position hedge,"
would tend to offset both positive and negative currency fluctuations,
but would not offset changes in security values caused by other
factors. A fund could also hedge the position by selling another
currency expected to perform similarly to the pound sterling. This
type of hedge, sometimes referred to as a "proxy hedge," could offer
advantages in terms of cost, yield, or efficiency, but generally would
not hedge currency exposure as effectively as a direct hedge into U.S.
dollars. Proxy hedges may result in losses if the currency used to
hedge does not perform similarly to the currency in which the hedged
securities are denominated.
A fund may enter into forward contracts to shift its investment
exposure from one currency into another. This may include shifting
exposure from U.S. dollars to a foreign currency, or from one foreign
currency to another foreign currency. This type of strategy, sometimes
known as a "cross-hedge," will tend to reduce or eliminate exposure to
the currency that is sold, and increase exposure to the currency that
is purchased, much as if a fund had sold a security denominated in one
currency and purchased an equivalent security denominated in another.
Cross-hedges protect against losses resulting from a decline in the
hedged currency, but will cause a fund to assume the risk of
fluctuations in the value of the currency it purchases.
Under certain conditions, SEC guidelines require mutual funds to set
aside appropriate liquid assets in a segregated custodial account to
cover currency forward contracts. As required by SEC guidelines, a
fund will segregate assets to cover currency forward contracts, if
any, whose purpose is essentially speculative. A fund will not
segregate assets to cover forward contracts entered into for hedging
purposes, including settlement hedges, position hedges, and proxy
hedges.
Successful use of currency management strategies will depend on FMR's
skill in analyzing currency values. Currency management strategies may
substantially change a fund's investment exposure to changes in
currency exchange rates and could result in losses to a fund if
currencies do not perform as FMR anticipates. For example, if a
currency's value rose at a time when FMR had hedged a fund by selling
that currency in exchange for dollars, a fund would not participate in
the currency's appreciation. If FMR hedges currency exposure through
proxy hedges, a fund could realize currency losses from both the hedge
and the security position if the two currencies do not move in tandem.
Similarly, if FMR increases a fund's exposure to a foreign currency
and that currency's value declines, a fund will realize a loss. There
is no assurance that FMR's use of currency management strategies will
be advantageous to a fund or that it will hedge at appropriate times.
FUND'S RIGHTS AS A SHAREHOLDER. The fund does not intend to direct or
administer the day-to-day operations of any company. A fund, however,
may exercise its rights as a shareholder and may communicate its views
on important matters of policy to management, the Board of Directors,
and shareholders of a company when FMR determines that such matters
could have a significant effect on the value of the fund's investment
in the company. The activities in which a fund may engage, either
individually or in conjunction with others, may include, among others,
supporting or opposing proposed changes in a company's corporate
structure or business activities; seeking changes in a company's
directors or management; seeking changes in a company's direction or
policies; seeking the sale or reorganization of the company or a
portion of its assets; or supporting or opposing third-party takeover
efforts. This area of corporate activity is increasingly prone to
litigation and it is possible that a fund could be involved in
lawsuits related to such activities. FMR will monitor such activities
with a view to mitigating, to the extent possible, the risk of
litigation against a fund and the risk of actual liability if a fund
is involved in litigation. No guarantee can be made, however, that
litigation against a fund will not be undertaken or liabilities
incurred.
FUTURES AND OPTIONS. The following paragraphs pertain to futures and
options: Asset Coverage for Futures and Options Positions, Combined
Positions, Correlation of Price Changes, Futures Contracts, Futures
Margin Payments, Limitations on Futures and Options Transactions,
Liquidity of Options and Futures Contracts, Options and Futures
Relating to Foreign Currencies, OTC Options, Purchasing Put and Call
Options, and Writing Put and Call Options.
ASSET COVERAGE FOR FUTURES AND OPTIONS POSITIONS. The fund will comply
with guidelines established by the SEC with respect to coverage of
options and futures strategies by mutual funds and, if the guidelines
so require, will set aside appropriate liquid assets in a segregated
custodial account in the amount prescribed. Securities held in a
segregated account cannot be sold while the futures or option strategy
is outstanding, unless they are replaced with other suitable assets.
As a result, there is a possibility that segregation of a large
percentage of the fund's assets could impede portfolio management or
the fund's ability to meet redemption requests or other current
obligations.
COMBINED POSITIONS involve purchasing and writing options in
combination with each other, or in combination with futures or forward
contracts, to adjust the risk and return characteristics of the
overall position. For example, purchasing a put option and writing a
call option on the same underlying instrument would construct a
combined position whose risk and return characteristics are similar to
selling a futures contract. Another possible combined position would
involve writing a call option at one strike price and buying a call
option at a lower price, to reduce the risk of the written call option
in the event of a substantial price increase. Because combined options
positions involve multiple trades, they result in higher transaction
costs and may be more difficult to open and close out.
CORRELATION OF PRICE CHANGES. Because there are a limited number of
types of exchange-traded options and futures contracts, it is likely
that the standardized contracts available will not match a fund's
current or anticipated investments exactly. A fund may invest in
options and futures contracts based on securities with different
issuers, maturities, or other characteristics from the securities in
which the fund typically invests, which involves a risk that the
options or futures position will not track the performance of the
fund's other investments.
Options and futures prices can also diverge from the prices of their
underlying instruments, even if the underlying instruments match a
fund's investments well. Options and futures prices are affected by
such factors as current and anticipated short-term interest rates,
changes in volatility of the underlying instrument, and the time
remaining until expiration of the contract, which may not affect
security prices the same way. Imperfect correlation may also result
from differing levels of demand in the options and futures markets and
the securities markets, from structural differences in how options and
futures and securities are traded, or from imposition of daily price
fluctuation limits or trading halts. A fund may purchase or sell
options and futures contracts with a greater or lesser value than the
securities it wishes to hedge or intends to purchase in order to
attempt to compensate for differences in volatility between the
contract and the securities, although this may not be successful in
all cases. If price changes in a fund's options or futures positions
are poorly correlated with its other investments, the positions may
fail to produce anticipated gains or result in losses that are not
offset by gains in other investments.
FUTURES CONTRACTS. In purchasing a futures contract, the buyer agrees
to purchase a specified underlying instrument at a specified future
date. In selling a futures contract, the seller agrees to sell a
specified underlying instrument at a specified future date. The price
at which the purchase and sale will take place is fixed when the buyer
and seller enter into the contract. Some currently available futures
contracts are based on specific securities, such as U.S. Treasury
bonds or notes, and some are based on indices of securities prices,
such as the Standard & Poor's 500 Index (S&P 500). Futures can be held
until their delivery dates, or can be closed out before then if a
liquid secondary market is available.
The value of a futures contract tends to increase and decrease in
tandem with the value of its underlying instrument. Therefore,
purchasing futures contracts will tend to increase a fund's exposure
to positive and negative price fluctuations in the underlying
instrument, much as if it had purchased the underlying instrument
directly. When a fund sells a futures contract, by contrast, the value
of its futures position will tend to move in a direction contrary to
the market. Selling futures contracts, therefore, will tend to offset
both positive and negative market price changes, much as if the
underlying instrument had been sold.
FUTURES MARGIN PAYMENTS. The purchaser or seller of a futures contract
is not required to deliver or pay for the underlying instrument unless
the contract is held until the delivery date. However, both the
purchaser and seller are required to deposit "initial margin" with a
futures broker, known as a futures commission merchant (FCM), when the
contract is entered into. Initial margin deposits are typically equal
to a percentage of the contract's value. If the value of either
party's position declines, that party will be required to make
additional "variation margin" payments to settle the change in value
on a daily basis. The party that has a gain may be entitled to receive
all or a portion of this amount. Initial and variation margin payments
do not constitute purchasing securities on margin for purposes of a
fund's investment limitations. In the event of the bankruptcy of an
FCM that holds margin on behalf of a fund, the fund may be entitled to
return of margin owed to it only in proportion to the amount received
by the FCM's other customers, potentially resulting in losses to the
fund.
LIMITATIONS ON FUTURES AND OPTIONS TRANSACTIONS. The fund
intends to file a notice of eligibility for exclusion from the
definition of the term "commodity pool operator" with the Commodity
Futures Trading Commission (CFTC) and the National Futures
Association, which regulate trading in the futures markets, before
engaging in any purchases or sales of futures contracts or options on
futures contracts. The fund intends to comply with Rule 4.5 under the
Commodity Exchange Act, which limits the extent to which the fund can
commit assets to initial margin deposits and option premiums.
In addition, the fund will not: (a) sell futures contracts, purchase
put options, or write call options if, as a result, more than 25% of
the fund's total assets would be hedged with futures and options under
normal conditions; (b) purchase futures contracts or write put options
if, as a result, the fund's total obligations upon settlement or
exercise of purchased futures contracts and written put options would
exceed 25% of its total assets under normal conditions; or (c)
purchase call options if, as a result, the current value of option
premiums for call options purchased by the fund would exceed 5% of the
fund's total assets. These limitations do not apply to options
attached to or acquired or traded together with their underlying
securities, and do not apply to securities that incorporate features
similar to options.
The above limitations on the fund's investments in futures contracts
and options, and the fund's policies regarding futures contracts and
options discussed elsewhere in this SAI, may be changed as regulatory
agencies permit.
LIQUIDITY OF OPTIONS AND FUTURES CONTRACTS. There is no assurance a
liquid secondary market will exist for any particular options or
futures contract at any particular time. Options may have relatively
low trading volume and liquidity if their strike prices are not close
to the underlying instrument's current price. In addition, exchanges
may establish daily price fluctuation limits for options and futures
contracts, and may halt trading if a contract's price moves upward or
downward more than the limit in a given day. On volatile trading days
when the price fluctuation limit is reached or a trading halt is
imposed, it may be impossible to enter into new positions or close out
existing positions. If the secondary market for a contract is not
liquid because of price fluctuation limits or otherwise, it could
prevent prompt liquidation of unfavorable positions, and potentially
could require a fund to continue to hold a position until delivery or
expiration regardless of changes in its value. As a result, a fund's
access to other assets held to cover its options or futures positions
could also be impaired.
OPTIONS AND FUTURES RELATING TO FOREIGN CURRENCIES. Currency futures
contracts are similar to forward currency exchange contracts, except
that they are traded on exchanges (and have margin requirements) and
are standardized as to contract size and delivery date. Most currency
futures contracts call for payment or delivery in U.S. dollars. The
underlying instrument of a currency option may be a foreign currency,
which generally is purchased or delivered in exchange for U.S.
dollars, or may be a futures contract. The purchaser of a currency
call obtains the right to purchase the underlying currency, and the
purchaser of a currency put obtains the right to sell the underlying
currency.
The uses and risks of currency options and futures are similar to
options and futures relating to securities or indices, as discussed
above. A fund may purchase and sell currency futures and may purchase
and write currency options to increase or decrease its exposure to
different foreign currencies. Currency options may also be purchased
or written in conjunction with each other or with currency futures or
forward contracts. Currency futures and options values can be expected
to correlate with exchange rates, but may not reflect other factors
that affect the value of a fund's investments. A currency hedge, for
example, should protect a Yen-denominated security from a decline in
the Yen, but will not protect a fund against a price decline resulting
from deterioration in the issuer's creditworthiness. Because the value
of a fund's foreign-denominated investments changes in response to
many factors other than exchange rates, it may not be possible to
match the amount of currency options and futures to the value of the
fund's investments exactly over time.
OTC OPTIONS. Unlike exchange-traded options, which are standardized
with respect to the underlying instrument, expiration date, contract
size, and strike price, the terms of over-the-counter (OTC) options
(options not traded on exchanges) generally are established through
negotiation with the other party to the option contract. While this
type of arrangement allows the purchaser or writer greater flexibility
to tailor an option to its needs, OTC options generally involve
greater credit risk than exchange-traded options, which are guaranteed
by the clearing organization of the exchanges where they are traded.
PURCHASING PUT AND CALL OPTIONS. By purchasing a put option, the
purchaser obtains the right (but not the obligation) to sell the
option's underlying instrument at a fixed strike price. In return for
this right, the purchaser pays the current market price for the option
(known as the option premium). Options have various types of
underlying instruments, including specific securities, indices of
securities prices, and futures contracts. The purchaser may terminate
its position in a put option by allowing it to expire or by exercising
the option. If the option is allowed to expire, the purchaser will
lose the entire premium. If the option is exercised, the purchaser
completes the sale of the underlying instrument at the strike price. A
purchaser may also terminate a put option position by closing it out
in the secondary market at its current price, if a liquid secondary
market exists.
The buyer of a typical put option can expect to realize a gain if
security prices fall substantially. However, if the underlying
instrument's price does not fall enough to offset the cost of
purchasing the option, a put buyer can expect to suffer a loss
(limited to the amount of the premium, plus related transaction
costs).
The features of call options are essentially the same as those of put
options, except that the purchaser of a call option obtains the right
to purchase, rather than sell, the underlying instrument at the
option's strike price. A call buyer typically attempts to participate
in potential price increases of the underlying instrument with risk
limited to the cost of the option if security prices fall. At the same
time, the buyer can expect to suffer a loss if security prices do not
rise sufficiently to offset the cost of the option.
WRITING PUT AND CALL OPTIONS. The writer of a put or call option takes
the opposite side of the transaction from the option's purchaser. In
return for receipt of the premium, the writer assumes the obligation
to pay the strike price for the option's underlying instrument if the
other party to the option chooses to exercise it. The writer may seek
to terminate a position in a put option before exercise by closing out
the option in the secondary market at its current price. If the
secondary market is not liquid for a put option, however, the writer
must continue to be prepared to pay the strike price while the option
is outstanding, regardless of price changes, and must continue to set
aside assets to cover its position. When writing an option on a
futures contract, a fund will be required to make margin payments to
an FCM as described above for futures contracts.
If security prices rise, a put writer would generally expect to
profit, although its gain would be limited to the amount of the
premium it received. If security prices remain the same over time, it
is likely that the writer will also profit, because it should be able
to close out the option at a lower price. If security prices fall, the
put writer would expect to suffer a loss. This loss should be less
than the loss from purchasing the underlying instrument directly,
however, because the premium received for writing the option should
mitigate the effects of the decline.
Writing a call option obligates the writer to sell or deliver the
option's underlying instrument, in return for the strike price, upon
exercise of the option. The characteristics of writing call options
are similar to those of writing put options, except that writing calls
generally is a profitable strategy if prices remain the same or fall.
Through receipt of the option premium, a call writer mitigates the
effects of a price decline. At the same time, because a call writer
must be prepared to deliver the underlying instrument in return for
the strike price, even if its current value is greater, a call writer
gives up some ability to participate in security price increases.
ILLIQUID INVESTMENTS are investments that cannot be sold or disposed
of in the ordinary course of business at approximately the prices at
which they are valued. Under the supervision of the Board of Trustees,
FMR determines the liquidity of a fund's investments and, through
reports from FMR, the Board monitors investments in illiquid
instruments. In determining the liquidity of a fund's investments, FMR
may consider various factors, including (1) the frequency of trades
and quotations, (2) the number of dealers and prospective purchasers
in the marketplace, (3) dealer undertakings to make a market, (4) the
nature of the security (including any demand or tender features), and
(5) the nature of the marketplace for trades (including the ability to
assign or offset the fund's rights and obligations relating to the
investment).
Investments currently considered by FMR to be illiquid include
repurchase agreements not entitling the holder to repayment of
principal and payment of interest within seven days, over-the-counter
options, and non-government stripped fixed-rate mortgage-backed
securities. Also, FMR may determine some restricted securities,
government-stripped fixed-rate mortgage-backed securities, loans and
other direct debt instruments, emerging market securities, and swap
agreements to be illiquid. However, with respect to over-the-counter
options a fund writes, all or a portion of the value of the underlying
instrument may be illiquid depending on the assets held to cover the
option and the nature and terms of any agreement the fund may have to
close out the option before expiration.
In the absence of market quotations, illiquid investments are priced
at fair value as determined in good faith by a committee appointed by
the Board of Trustees.
INDEXED SECURITIES are instruments whose prices are indexed to the
prices of other securities, securities indices, currencies, precious
metals or other commodities, or other financial indicators. Indexed
securities typically, but not always, are debt securities or deposits
whose value at maturity or coupon rate is determined by reference to a
specific instrument or statistic.
Gold-indexed securities typically provide for a maturity value that
depends on the price of gold, resulting in a security whose price
tends to rise and fall together with gold prices. Currency-indexed
securities typically are short-term to intermediate-term debt
securities whose maturity values or interest rates are determined by
reference to the values of one or more specified foreign currencies,
and may offer higher yields than U.S. dollar-denominated securities.
Currency-indexed securities may be positively or negatively indexed;
that is, their maturity value may increase when the specified currency
value increases, resulting in a security that performs similarly to a
foreign-denominated instrument, or their maturity value may decline
when foreign currencies increase, resulting in a security whose price
characteristics are similar to a put on the underlying currency.
Currency-indexed securities may also have prices that depend on the
values of a number of different foreign currencies relative to each
other.
The performance of indexed securities depends to a great extent on the
performance of the security, currency, or other instrument to which
they are indexed, and may also be influenced by interest rate changes
in the United States and abroad. Indexed securities may be more
volatile than the underlying instruments. Indexed securities are also
subject to the credit risks associated with the issuer of the
security, and their values may decline substantially if the issuer's
creditworthiness deteriorates. Recent issuers of indexed securities
have included banks, corporations, and certain U.S. Government
agencies.
INTERFUND BORROWING AND LENDING PROGRAM. Pursuant to an exemptive
order issued by the SEC, a fund may lend money to, and borrow money
from, other funds advised by FMR or its affiliates. A fund will lend
through the program only when the returns are higher than those
available from an investment in repurchase agreements, and will borrow
through the program only when the costs are equal to or lower than the
cost of bank loans. Interfund loans and borrowings normally extend
overnight, but can have a maximum duration of seven days. Loans may be
called on one day's notice. A fund may have to borrow from a bank at a
higher interest rate if an interfund loan is called or not renewed.
Any delay in repayment to a lending fund could result in a lost
investment opportunity or additional borrowing costs.
LOANS AND OTHER DIRECT DEBT INSTRUMENTS. Direct debt instruments are
interests in amounts owed by a corporate, governmental, or other
borrower to lenders or lending syndicates (loans and loan
participations), to suppliers of goods or services (trade claims or
other receivables), or to other parties. Direct debt instruments are
subject to a fund's policies regarding the quality of debt securities.
Purchasers of loans and other forms of direct indebtedness depend
primarily upon the creditworthiness of the borrower for payment of
interest and repayment of principal. Direct debt instruments may not
be rated by any nationally recognized statistical rating service. If
scheduled interest or principal payments are not made, the value of
the instrument may be adversely affected. Loans that are fully secured
provide more protections than an unsecured loan in the event of
failure to make scheduled interest or principal payments. However,
there is no assurance that the liquidation of collateral from a
secured loan would satisfy the borrower's obligation, or that the
collateral could be liquidated. Indebtedness of borrowers whose
creditworthiness is poor involves substantially greater risks and may
be highly speculative. Borrowers that are in bankruptcy or
restructuring may never pay off their indebtedness, or may pay only a
small fraction of the amount owed. Direct indebtedness of developing
countries also involves a risk that the governmental entities
responsible for the repayment of the debt may be unable, or unwilling,
to pay interest and repay principal when due.
Investments in loans through direct assignment of a financial
institution's interests with respect to a loan may involve additional
risks. For example, if a loan is foreclosed, the purchaser could
become part owner of any collateral, and would bear the costs and
liabilities associated with owning and disposing of the collateral. In
addition, it is conceivable that under emerging legal theories of
lender liability, a purchaser could be held liable as a co-lender.
Direct debt instruments may also involve a risk of insolvency of the
lending bank or other intermediary. Direct debt instruments that are
not in the form of securities may offer less legal protection to the
purchaser in the event of fraud or misrepresentation. In the absence
of definitive regulatory guidance, FMR uses its research to attempt to
avoid situations where fraud or misrepresentation could adversely
affect a fund.
A loan is often administered by a bank or other financial institution
that acts as agent for all holders. The agent administers the terms of
the loan, as specified in the loan agreement. Unless, under the terms
of the loan or other indebtedness, the purchaser has direct recourse
against the borrower, the purchaser may have to rely on the agent to
apply appropriate credit remedies against a borrower. If assets held
by the agent for the benefit of a purchaser were determined to be
subject to the claims of the agent's general creditors, the purchaser
might incur certain costs and delays in realizing payment on the loan
or loan participation and could suffer a loss of principal or
interest.
Direct indebtedness may include letters of credit, revolving credit
facilities, or other standby financing commitments that obligate
purchasers to make additional cash payments on demand. These
commitments may have the effect of requiring a purchaser to increase
its investment in a borrower at a time when it would not otherwise
have done so, even if the borrower's condition makes it unlikely that
the amount will ever be repaid. A fund will set aside appropriate
liquid assets in a segregated custodial account to cover its potential
obligations under standby financing commitments.
The fund limits the amount of total assets that it will invest in any
one issuer or in issuers within the same industry (see the fund's
investment limitations). For purposes of these limitations, a fund
generally will treat the borrower as the "issuer" of indebtedness held
by the fund. In the case of loan participations where a bank or other
lending institution serves as financial intermediary between a fund
and the borrower, if the participation does not shift to the fund the
direct debtor-creditor relationship with the borrower, SEC
interpretations require a fund, in appropriate circumstances, to treat
both the lending bank or other lending institution and the borrower as
"issuers" for these purposes. Treating a financial intermediary as an
issuer of indebtedness may restrict a fund's ability to invest in
indebtedness related to a single financial intermediary, or a group of
intermediaries engaged in the same industry, even if the underlying
borrowers represent many different companies and industries.
LOWER-QUALITY DEBT SECURITIES. Lower-quality debt securities have poor
protection with respect to the payment of interest and repayment of
principal, or may be in default. These securities are often considered
to be speculative and involve greater risk of loss or price changes
due to changes in the issuer's capacity to pay. The market prices of
lower-quality debt securities may fluctuate more than those of
higher-quality debt securities and may decline significantly in
periods of general economic difficulty, which may follow periods of
rising interest rates.
While the market for high-yield corporate debt securities has been in
existence for many years and has weathered previous economic
downturns, the 1980s brought a dramatic increase in the use of such
securities to fund highly leveraged corporate acquisitions and
restructurings. Past experience may not provide an accurate indication
of the future performance of the high-yield bond market, especially
during periods of economic recession.
The market for lower-quality debt securities may be thinner and less
active than that for higher-quality debt securities, which can
adversely affect the prices at which the former are sold. If market
quotations are not available, lower-quality debt securities will be
valued in accordance with procedures established by the Board of
Trustees, including the use of outside pricing services. Judgment
plays a greater role in valuing high-yield debt securities than is the
case for securities for which more external sources for quotations and
last-sale information are available. Adverse publicity and changing
investor perceptions may affect the liquidity of lower-quality debt
securities and the ability of outside pricing services to value
lower-quality debt securities.
Since the risk of default is higher for lower-quality debt securities,
FMR's research and credit analysis are an especially important part of
managing securities of this type. FMR will attempt to identify those
issuers of high-yielding securities whose financial condition is
adequate to meet future obligations, has improved, or is expected to
improve in the future. FMR's analysis focuses on relative values based
on such factors as interest or dividend coverage, asset coverage,
earnings prospects, and the experience and managerial strength of the
issuer.
A fund may choose, at its expense or in conjunction with others, to
pursue litigation or otherwise to exercise its rights as a security
holder to seek to protect the interests of security holders if it
determines this to be in the best interest of the fund's shareholders.
REAL ESTATE INVESTMENT TRUSTS. Equity real estate investment trusts
own real estate properties, while mortgage real estate investment
trusts make construction, development, and long-term mortgage loans.
Their value may be affected by changes in the value of the underlying
property of the trusts, the creditworthiness of the issuer, property
taxes, interest rates, and tax and regulatory requirements, such as
those relating to the environment. Both types of trusts are dependent
upon management skill, are not diversified, and are subject to heavy
cash flow dependency, defaults by borrowers, self-liquidation, and the
possibility of failing to qualify for tax-free status of income under
the Internal Revenue Code and failing to maintain exemption from the
1940 Act.
REPURCHASE AGREEMENTS. In a repurchase agreement, a fund purchases a
security and simultaneously commits to sell that security back to the
original seller at an agreed-upon price. The resale price reflects the
purchase price plus an agreed-upon incremental amount which is
unrelated to the coupon rate or maturity of the purchased security. 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. While it does
not presently appear possible to eliminate all risks from these
transactions (particularly the possibility that the value of the
underlying security will be less than the resale price, as well as
delays and costs to a fund in connection with bankruptcy proceedings),
the fund will engage in repurchase agreement transactions with parties
whose creditworthiness has been reviewed and found satisfactory by
FMR.
RESTRICTED SECURITIES generally can be sold in privately negotiated
transactions, pursuant to an exemption from registration under the
Securities Act of 1933, or in a registered public offering. Where
registration is required, a fund may be obligated to pay all or part
of the registration expense and a considerable period may elapse
between the time it decides to seek registration and the time it may
be permitted to sell a security under an effective registration
statement. If, during such a period, adverse market conditions were to
develop, a fund might obtain a less favorable price than prevailed
when it decided to seek registration of the security.
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. While a reverse repurchase
agreement is outstanding, a fund will maintain appropriate liquid
assets in a segregated custodial account to cover its obligation under
the agreement. The fund will enter into reverse repurchase agreements
with parties whose creditworthiness has been reviewed and found
satisfactory by FMR. Such transactions may increase fluctuations in
the market value of fund assets and may be viewed as a form of
leverage.
SECURITIES LENDING. A fund may lend securities to parties such as
broker-dealers or institutional investors, including Fidelity
Brokerage Services, Inc. (FBSI). FBSI is a member of the New York
Stock Exchange and a subsidiary of FMR Corp.
Securities lending allows a fund to retain ownership of the securities
loaned and, at the same time, to earn additional income. Since there
may be delays in the recovery of loaned securities, or even a loss of
rights in collateral supplied should the borrower fail financially,
loans will be made only to parties deemed by FMR to be of good
standing. Furthermore, they will only be made if, in FMR's judgment,
the consideration to be earned from such loans would justify the risk.
FMR understands that it is the current view of the SEC Staff that a
fund may engage in loan transactions only under the following
conditions: (1) the fund must receive 100% collateral in the form of
cash or cash equivalents (e.g., U.S. Treasury bills or notes) from the
borrower; (2) the borrower must increase the collateral whenever the
market value of the securities loaned (determined on a daily basis)
rises above the value of the collateral; (3) after giving notice, the
fund must be able to terminate the loan at any time; (4) the fund must
receive reasonable interest on the loan or a flat fee from the
borrower, as well as amounts equivalent to any dividends, interest, or
other distributions on the securities loaned and to any increase in
market value; (5) the fund may pay only reasonable custodian fees in
connection with the loan; and (6) the Board of Trustees must be able
to vote proxies on the securities loaned, either by terminating the
loan or by entering into an alternative arrangement with the borrower.
Cash received through loan transactions may be invested in other
eligible securities. Investing this cash subjects that investment, as
well as the security loaned, to market forces (i.e., capital
appreciation or depreciation).
SHORT SALES "AGAINST THE BOX." A fund may sell securities short when
it owns or has the right to obtain securities equivalent in kind or
amount to the securities sold short. Such short sales are known as
short sales "against the box." If a fund enters into a short sale
against the box, it will be required to set aside securities
equivalent in kind and amount to the securities sold short (or
securities convertible or exchangeable into such securities) and will
be required to hold such securities while the short sale is
outstanding. The fund will incur transaction costs, including interest
expenses, in connection with opening, maintaining, and closing short
sales against the box.
SOURCES OF CREDIT OR LIQUIDITY SUPPORT. FMR may rely on its
evaluation of the credit of a bank or other entity in determining
whether to purchase a security supported by a letter of credit
guarantee, put or demand feature, insurance or other source of credit
or liquidity. In evaluating the credit of a foreign bank or other
foreign entities, FMR will consider whether adequate public
information about the entity is available and whether the entity may
be subject to unfavorable political or economic developments, currency
controls, or other government restrictions that might affect its
ability to honor its commitment.
SWAP AGREEMENTS can be individually negotiated and structured to
include exposure to a variety of different types of investments or
market factors. Depending on their structure, swap agreements may
increase or decrease a fund's exposure to long- or short-term interest
rates (in the United States or abroad), foreign currency values,
mortgage securities, corporate borrowing rates, or other factors such
as security prices or inflation rates. Swap agreements can take many
different forms and are known by a variety of names.
In a typical cap or floor agreement, one party agrees to make payments
only under specified circumstances, usually in return for payment of a
fee by the other party. For example, the buyer of an interest rate cap
obtains the right to receive payments to the extent that a specified
interest rate exceeds an agreed-upon level, while the seller of an
interest rate floor is obligated to make payments to the extent that a
specified interest rate falls below an agreed-upon level. An interest
rate collar combines elements of buying a cap and selling a floor.
Swap agreements will tend to shift a fund's investment exposure from
one type of investment to another. For example, if the fund agreed to
exchange payments in dollars for payments in foreign currency, the
swap agreement would tend to decrease the fund's exposure to U.S.
interest rates and increase its exposure to foreign currency and
interest rates. Caps and floors have an effect similar to buying or
writing options. Depending on how they are used, swap agreements may
increase or decrease the overall volatility of a fund's investments
and its share price.
The most significant factor in the performance of swap agreements is
the change in the specific interest rate, currency, or other factors
that determine the amounts of payments due to and from a fund. If a
swap agreement calls for payments by the fund, the fund must be
prepared to make such payments when due. In addition, if the
counterparty's creditworthiness declined, the value of a swap
agreement would be likely to decline, potentially resulting in losses.
A fund may be able to eliminate its exposure under a swap agreement
either by assignment or other disposition, or by entering into an
offsetting swap agreement with the same party or a similarly
creditworthy party.
A fund will maintain appropriate liquid assets in a segregated
custodial account to cover its current obligations under swap
agreements. If a fund enters into a swap agreement on a net basis, it
will segregate assets with a daily value at least equal to the excess,
if any, of the fund's accrued obligations under the swap agreement
over the accrued amount the fund is entitled to receive under the
agreement. If a fund enters into a swap agreement on other than a net
basis, it will segregate assets with a value equal to the full amount
of the fund's accrued obligations under the agreement.
WARRANTS. Warrants are instruments which entitle the holder to buy an
equity security at a specific price for a specific period of time.
Changes in the value of a warrant do not necessarily correspond to
changes in the value of its underlying security. The price of a
warrant may be more volatile than the price of its underlying
security, and a warrant may offer greater potential for capital
appreciation as well as capital loss.
Warrants do not entitle a holder to dividends or voting rights with
respect to the underlying security and do not represent any rights in
the assets of the issuing company. A warrant ceases to have value if
it is not exercised prior to its expiration date. These factors can
make warrants more speculative than other types of investments.
3.PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are placed
on behalf of the fund by FMR pursuant to authority contained in the
management contract. FMR is also responsible for the placement of
transaction orders for other investment companies and accounts for
which it or its affiliates act as investment adviser. In selecting
broker-dealers, subject to applicable limitations of the federal
securities laws, FMR considers various relevant factors, including,
but not limited to: the size and type of the transaction; the nature
and character of the markets for the security to be purchased or sold;
the execution efficiency, settlement capability, and financial
condition of the broker-dealer firm; the broker-dealer's execution
services rendered on a continuing basis; the reasonableness of any
commissions; and, if applicable, arrangements for payment of fund
expenses.
If FMR grants investment management authority to a sub-adviser (see
the section entitled "Management Contract"), that sub-adviser is
authorized to place orders for the purchase and sale of portfolio
securities, and will do so in accordance with the policies described
above.
Generally, commissions for investments traded on foreign exchanges
will be higher than for investments traded on U.S. exchanges and may
not be subject to negotiation.
The fund may execute portfolio transactions with broker-dealers who
provide research and execution services to the fund or other accounts
over which FMR or its affiliates exercise investment discretion. Such
services may include advice concerning the value of securities; the
advisability of investing in, purchasing, or selling securities; and
the availability of securities or the purchasers or sellers of
securities. In addition, such broker-dealers may furnish analyses and
reports concerning issuers, industries, securities, economic factors
and trends, portfolio strategy, and performance of accounts; and
effect securities transactions and perform functions incidental
thereto (such as clearance and settlement).
The selection of such broker-dealers for transactions in equity
securities is generally made by FMR (to the extent possible consistent
with execution considerations) in accordance with a ranking of
broker-dealers determined periodically by FMR's investment staff based
upon the quality of research and execution services provided.
For transactions in fixed-income securities, FMR's selection of
broker-dealers is generally based on the availability of a security
and its price and, to a lesser extent, on the overall quality of
execution and other services, including research, provided by the
broker-dealer.
The receipt of research from broker-dealers that execute transactions
on behalf of a fund may be useful to FMR in rendering investment
management services to that fund or its other clients, and conversely,
such research provided by broker-dealers who have executed transaction
orders on behalf of other FMR clients may be useful to FMR in carrying
out its obligations to a fund. The receipt of such research has not
reduced FMR's normal independent research activities; however, it
enables FMR to avoid the additional expenses that could be incurred if
FMR tried to develop comparable information through its own efforts.
Fixed-income securities are generally purchased from an issuer or
underwriter acting as principal for the securities, on a net basis
with no brokerage commission paid. However, the dealer is compensated
by a difference between the security's original purchase price and the
selling price, the so-called "bid-asked spread." Securities may also
be purchased from underwriters at prices that include underwriting
fees.
Subject to applicable limitations of the federal securities laws, the
fund may pay a broker-dealer commissions for agency transactions that
are in excess of the amount of commissions charged by other
broker-dealers in recognition of their research and execution
services. In order to cause the fund to pay such higher commissions,
FMR must determine in good faith that such commissions are reasonable
in relation to the value of the brokerage and research services
provided by such executing broker-dealers, viewed in terms of a
particular transaction or FMR's overall responsibilities to that fund
or its other clients. In reaching this determination, FMR will not
attempt to place a specific dollar value on the brokerage and research
services provided, or to determine what portion of the compensation
should be related to those services.
FMR is authorized to use research services provided by and to place
portfolio transactions with brokerage firms that have provided
assistance in the distribution of shares of the fund or shares of
other Fidelity funds to the extent permitted by law. FMR may use
research services provided by and place agency transactions with
National Financial Services Corporation (NFSC) and Fidelity Brokerage
Services Japan LLC (FBSJ), indirect subsidiaries of FMR Corp., if the
commissions are fair, reasonable, and comparable to commissions
charged by non-affiliated, qualified brokerage firms for similar
services. Prior to December 9, 1997, FMR used research services
provided by and placed agency transactions with Fidelity Brokerage
Services (FBS), an indirect subsidiary of FMR Corp.
FMR may allocate brokerage transactions to broker-dealers (including
affiliates of FMR) who have entered into arrangements with FMR under
which the broker-dealer allocates a portion of the commissions paid by
a fund toward the reduction of that fund's expenses. The transaction
quality must, however, be comparable to those of other qualified
broker-dealers.
Section 11(a) of the Securities Exchange Act of 1934 prohibits members
of national securities exchanges from executing exchange transactions
for accounts which they or their affiliates manage, unless certain
requirements are satisfied. Pursuant to such requirements, the Board
of Trustees has authorized NFSC to execute portfolio transactions on
national securities exchanges in accordance with approved procedures
and applicable SEC rules.
The Trustees periodically review FMR's performance of its
responsibilities in connection with the placement of portfolio
transactions on behalf of the fund and review the commissions paid by
the fund over representative periods of time to determine if they are
reasonable in relation to the benefits to the fund.
The fund's annualized turnover rate for its first fiscal period is not
expected to exceed 300%. Because a high turnover rate increases
transaction costs and may increase taxable gains, FMR carefully weighs
the anticipated benefits of short-term investing against these
consequences.
The Trustees of the fund have approved procedures in conformity with
Rule 10f-3 under the 1940 Act whereby a fund may purchase securities
that are offered in underwritings in which an affiliate of FMR
participates. These procedures prohibit the fund from directly or
indirectly benefiting an FMR affiliate in connection with such
underwritings. In addition, for underwritings where an FMR affiliate
participates as a principal underwriter, certain restrictions may
apply that could, among other things, limit the amount of securities
that the fund could purchase in the underwriting.
From time to time the Trustees will review whether the recapture for
the benefit of the fund of some portion of the brokerage commissions
or similar fees paid by the fund on portfolio transactions is legally
permissible and advisable. The fund seeks to recapture soliciting
broker-dealer fees on the tender of portfolio securities, but at
present no other recapture arrangements are in effect. The Trustees
intend to continue to review whether recapture opportunities are
available and are legally permissible and, if so, to determine in the
exercise of their business judgment whether it would be advisable for
the fund to seek such recapture.
Although the Trustees and officers of the fund are substantially the
same as those of other funds managed by FMR or its affiliates,
investment decisions for the fund are made independently from those of
other funds managed by FMR or accounts managed by FMR affiliates. It
sometimes happens that the same security is held in the portfolio of
more than one of these funds or accounts. Simultaneous transactions
are inevitable when several funds and accounts are managed by the same
investment adviser, particularly when the same security is suitable
for the investment objective of more than one fund or account.
When two or more funds are simultaneously engaged in the purchase or
sale of the same security, the prices and amounts are allocated in
accordance with procedures believed to be appropriate and equitable
for each fund. In some cases this system could have a detrimental
effect on the price or value of the security as far as the fund is
concerned. In other cases, however, the ability of the fund to
participate in volume transactions will produce better executions and
prices for the fund. It is the current opinion of the Trustees that
the desirability of retaining FMR as investment adviser to the fund
outweighs any disadvantages that may be said to exist from exposure to
simultaneous transactions.
4.VALUATION
Fidelity Service Company, Inc. (FSC) normally determines each class's
net asset value per share (NAV) as of the close of the New York Stock
Exchange (NYSE) (normally 4:00 p.m. Eastern time). The valuation of
portfolio securities is determined as of this time for the purpose of
computing each class's NAV.
Portfolio securities are valued by various methods depending on the
primary market or exchange on which they trade. Most equity securities
for which the primary market is the United States are valued at last
sale price or, if no sale has occurred, at the closing bid price. Most
equity securities for which the primary market is outside the United
States are valued using the official closing price or the last sale
price in the principal market in which they are traded. If the last
sale price (on the local exchange) is unavailable, the last evaluated
quote or last bid price normally is used. Securities of other open-end
investment companies are valued at their respective NAVs.
Fixed-income securities and other assets for which market quotations
are readily available may be valued at market values determined by
such securities' most recent bid prices (sales prices if the principal
market is an exchange) in the principal market in which they normally
are traded, as furnished by recognized dealers in such securities or
assets. Or, fixed-income securities and convertible securities may be
valued on the basis of information furnished by a pricing service that
uses a valuation matrix which incorporates both dealer-supplied
valuations and electronic data processing techniques. Use of pricing
services has been approved by the Board of Trustees. A number of
pricing services are available, and the fund may use various pricing
services or discontinue the use of any pricing service.
Futures contracts and options are valued on the basis of market
quotations, if available.
Foreign securities are valued based on prices furnished by independent
brokers or quotation services which express the value of securities in
their local currency. FSC gathers all exchange rates daily at the
close of the NYSE using the last quoted price on the local currency
and then translates the value of foreign securities from their local
currencies into U.S. dollars. Any changes in the value of forward
contracts due to exchange rate fluctuations and days to maturity are
included in the calculation of NAV. If an extraordinary event that is
expected to materially affect the value of a portfolio security occurs
after the close of an exchange on which that security is traded, then
that security will be valued as determined in good faith by a
committee appointed by the Board of Trustees.
Short-term securities with remaining maturities of sixty days or less
for which market quotations and information furnished by a pricing
service are not readily available are valued either at amortized cost
or at original cost plus accrued interest, both of which approximate
current value. In addition, securities and other assets for which
there is no readily available market value may be valued in good faith
by a committee appointed by the Board of Trustees. The procedures set
forth above need not be used to determine the value of the securities
owned by the fund if, in the opinion of a committee appointed by the
Board of Trustees, some other method would more accurately reflect the
fair market value of such securities.
5.PERFORMANCE
A class may quote performance in various ways. All performance
information supplied by the fund in advertising is historical and is
not intended to indicate future returns. Each class's share price and
total return fluctuate in response to market conditions and other
factors, and the value of fund shares when redeemed may be more or
less than their original cost.
TOTAL RETURN CALCULATIONS. Total returns quoted in advertising reflect
all aspects of a class's return, including the effect of reinvesting
dividends and capital gain distributions, and any change in a class's
NAV over a stated period. A class's total 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. Average annual total
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 total return of 100% over ten years would produce an
average annual total 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 total returns covering periods of less than one
year are calculated by determining a class's total 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 total 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 total returns represent averaged
figures as opposed to the actual year-to-year performance of a class.
In addition to average annual total returns, a class may quote
unaveraged or cumulative total returns reflecting the simple change in
value of an investment over a stated period. Average annual and
cumulative total returns may be quoted as a percentage or as a dollar
amount, and may be calculated for a single investment, a series of
investments, or a series of redemptions, over any time period. Total
returns may be broken down into their components of income and capital
(including capital gains and changes in share price) in order to
illustrate the relationship of these factors and their contributions
to total return. Total returns may be quoted on a before-tax or
after-tax basis and may be quoted with or without taking a class's
maximum sales charge into account. Excluding a class's sales charge
from a total return calculation produces a higher total return figure.
Total returns, yields, and other performance information may be quoted
numerically or in a table, graph, or similar illustration.
NET ASSET VALUE. Charts and graphs using a class's net asset values,
adjusted net asset values, and benchmark indices may be used to
exhibit performance. An adjusted NAV includes any distributions paid
by a fund and reflects all elements of a class's return. Unless
otherwise indicated, a class's adjusted NAVs are not adjusted for
sales charges, if any.
MOVING AVERAGES. A class may illustrate performance using moving
averages. A long-term moving average is the average of each week's
adjusted closing NAV for a specified period. A short-term moving
average is the average of each day's adjusted closing NAV for a
specified period. Moving Average Activity Indicators combine adjusted
closing NAVs from the last business day of each week with moving
averages for a specified period to produce indicators showing when an
NAV has crossed, stayed above, or stayed below its moving average.
Each class may compare its total 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 S&P 500 and DJIA comparisons would show how
each class's total return compared to the record of a broad unmanaged
index of common stocks and a narrower set of stocks of major
industrial companies, respectively. The fund has the ability to invest
in securities not included in either index, and its investment
portfolio may or may not be similar in composition to the indexes. The
S&P 500 and DJIA returns are based on the prices of unmanaged groups
of stocks and, unlike each class's returns, do not include the effect
of brokerage commissions or other costs of investing.
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 total return, assume reinvestment of distributions, do
not take sales charges or trading fees into consideration, and are
prepared without regard to tax consequences. In addition to the mutual
fund rankings, a class's performance may be compared to stock, bond,
and money market mutual fund performance indices prepared by Lipper or
other organizations. When comparing these indices, it is important to
remember the risk and return characteristics of each type of
investment. For example, while stock mutual funds may offer higher
potential returns, they also carry the highest degree of share price
volatility. Likewise, money market funds may offer greater stability
of principal, but generally do not offer the higher potential returns
available from stock mutual funds.
From time to time, a class's performance may also be compared to other
mutual funds tracked by financial or business publications and
periodicals. For example, the fund may quote Morningstar, Inc. in its
advertising materials. Morningstar, Inc. is a mutual fund rating
service that rates mutual funds on the basis of risk-adjusted
performance. Rankings that compare the performance of Fidelity funds
to one another in appropriate categories over specific periods of time
may also be quoted in advertising.
A class's performance may also be compared to that of a benchmark
index representing the universe of securities in which the fund may
invest. The total return of a benchmark index reflects reinvestment of
all dividends and capital gains paid by securities included in the
index. Unlike a class's returns, however, the index returns do not
reflect brokerage commissions, transaction fees, or other costs of
investing directly in the securities included in the index.
Each class of the fund may compare its performance to that of the
Russell 2000 Index, an unmanaged index of 2,000 small company stocks.
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, the fund may offer greater liquidity or higher
potential returns than CDs, the 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 indices.
Fidelity funds may use the performance of these capital markets in
order to demonstrate general risk-versus-reward investment scenarios.
Performance comparisons may also include the value of a hypothetical
investment in any of these capital markets. The risks associated with
the security types in any capital market may or may not correspond
directly to those of the funds. Ibbotson calculates total returns in
the same method as the funds.
The funds may also compare performance to that of other compilations
or indices that exist currently or may be developed and made available
in the future, including, but not limited to indices compiled by Frank
Russell Company, Lipper, Ibbotson, Standard & Poor's, and other
organizations which measure the performance of funds or individual
companies at different levels of market capitalization.
In advertising materials, Fidelity may reference or discuss its
products and services, which may include other Fidelity funds;
retirement investing; model portfolios or allocations; and saving for
college or other goals. In addition, Fidelity may quote or reprint
financial or business publications, surveys, and periodicals, as they
relate to current economic and political conditions, fund management,
portfolio composition, research capabilities, investment philosophy,
investment techniques, the desirability of owning a particular mutual
fund, and Fidelity services and products.
The Fund may be advertised as part of certain asset allocation
programs involving other Fidelity or non-Fidelity mutual funds. These
asset allocation programs may advertise a model portfolio and its
performance results.
The Fund may be advertised as part of a no transaction fee (NTF)
program in which Fidelity and non-Fidelity mutual funds are offered.
An NTF program may advertise performance results.
A class may present its fund number, Quotron number, and CUSIP number,
and discuss or quote the fund's current portfolio manager.
VOLATILITY. A class may quote various measures of volatility and
benchmark correlation in advertising. In addition, the fund may
compare these measures to those of other funds. Measures of volatility
seek to compare a class's historical share price fluctuations or total
returns to those of a benchmark. Measures of benchmark correlation
indicate how valid a comparative benchmark may be. All measures of
volatility and correlation are calculated using averages of historical
data.
MOMENTUM INDICATORS indicate a class's price movements over specific
periods of time. Each point on the momentum indicator represents a
class's percentage change in price movements over that period.
The fund may advertise examples of the effects of periodic investment
plans, including the principle of dollar cost averaging. In such a
program, an investor invests a fixed dollar amount in a fund at
periodic intervals, thereby purchasing fewer shares when prices are
high and more shares when prices are low. While such a strategy does
not assure a profit or guard against loss in a declining market, the
investor's average cost per share can be lower than if fixed numbers
of shares are purchased at the same intervals. In evaluating such a
plan, investors should consider their ability to continue purchasing
shares during periods of low price levels.
The 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 July 31, 1998 , FMR advised over $ 31 billion in
municipal fund assets, $ 107 billion in money market fund
assets, $ 460 billion in equity fund assets, $ 71 billion
in international fund assets, and $ 27 billion in Spartan fund
assets. The fund may reference the growth and variety of money market
mutual funds and the adviser's innovation and participation in the
industry. The equity funds under management figure represents the
largest amount of equity fund assets under management by a mutual fund
investment adviser in the United States, making FMR America's leading
equity (stock) fund manager. FMR, its subsidiaries, and affiliates
maintain a worldwide information and communications network for the
purpose of researching and managing investments abroad.
6.ADDITIONAL PURCHASE, EXCHANGE AND REDEMPTION INFORMATION
Pursuant to Rule 22d-1 under the 1940 Act, FDC exercises its right to
waive Class A's and Class T's front-end sales charge on shares
acquired through reinvestment of dividends and capital gain
distributions or in connection with a fund's merger with or
acquisition of any investment company or trust. In addition, FDC has
chosen to waive Class A's and Class T's front-end sales charge in
certain instances due to sales efficiencies and competitive
considerations. The sales charge will not apply:
CLASS A SHARES ONLY
1. to shares purchased for an insurance company separate account used
to fund annuity contracts for employee benefit plans (including 403(b)
programs, but otherwise as defined in ERISA);
2. to shares purchased by a trust institution or bank trust department
for a managed account that is charged an asset-based fee. Employee
benefit plans (including 403(b) programs, but otherwise as defined in
ERISA) and accounts managed by third parties do not qualify for this
waiver;
3. to shares purchased by a broker-dealer for a managed account that
is charged an asset-based fee. Employee benefit plans (including
403(b) programs, but otherwise as defined in ERISA) do not qualify for
this waiver;
4. to shares purchased by a registered investment adviser that is not
part of an organization primarily engaged in the brokerage business
for an account that is managed on a discretionary basis and is charged
an asset-based fee. Employee benefit plans (including 403(b) programs,
but otherwise as defined in ERISA) do not qualify for this waiver;
5. to shares purchased for (i) an employee benefit plan (including
403(b) programs, but otherwise as defined in ERISA) having $25 million
or more in plan assets or (ii) an employee benefit plan (including
403(b) programs, but otherwise as defined in ERISA) that is part of an
investment professional sponsored program that requires the
participating employee benefit plan to initially invest in Class C or
Class B shares and, upon meeting certain criteria, subsequently
requires the plan to invest in Class A shares; or
6. to shares purchased prior to December 31, 1998 by shareholders who
have closed their Fidelity Advisor Class A Municipal Bond, Fidelity
Advisor Class A California Municipal Income, or Fidelity Advisor Class
A New York Municipal Income accounts prior to December 31, 1997. This
waiver is limited to purchases of up to $10,000; shareholders are
entitled to this waiver after the original load waiver certificate is
received by FIIOC.
CLASS T SHARES ONLY
1. to shares purchased for an insurance company separate
account used to fund annuity contracts for employee benefit plans
(including 403(b) programs, but otherwise as defined in ERISA);
2. to shares purchased by a trust institution or bank trust
department for a managed account that is charged an asset-based fee.
Accounts manages by third parties do not qualify for this waiver;
3. to shares purchased by a broker-dealer for a managed account
that is charged an asset-based fee;
4. to shares purchased by a registered investment adviser that
is not part of an organization primarily engaged in the brokerage
business for an account that is managed on a discretionary basis and
is charged an asset-based fee;
5. to shares purchased for an employee benefit plan (as defined
by ERISA (except SIMPLE IRA, SEP, and SARSEP plans and plans covering
self-employed individuals and their employees (formerly, Keogh/H.R. 10
plans), but including 403(b) programs));
6. to shares purchased for a Fidelity or Fidelity Advisor
account (including purchases by exchange) with the proceeds of a
distribution from (i) an insurance company separate account used to
fund annuity contracts for employee benefit plans (including 403(b)
programs, but otherwise as defined in ERISA) that are invested in
Fidelity Advisor or Fidelity funds, or (ii) an employee benefit plan
(including 403(b) programs, but otherwise as defined in ERISA) that is
invested in Fidelity Advisor or Fidelity funds. (Distributions other
than those transferred to an IRA account must be transferred directly
into a Fidelity account.);
7. to shares purchased for any state, county, or city, or any
governmental instrumentality, department, authority or agency;
8. to shares purchased with redemption proceeds from other
mutual fund complexes on which the investor has paid a front-end or
contingent deferred sales charge;
9. to shares purchased by a current or former Trustee or
officer of a Fidelity fund or a current or retired officer, director,
or regular employee of FMR Corp. or FIL or their direct or indirect
subsidiaries (a Fidelity Trustee or employee), the spouse of a
Fidelity Trustee or employee, a Fidelity Trustee or employee acting as
custodian for a minor child, or a person acting as trustee of a trust
for the sole benefit of the minor child of a Fidelity Trustee or
employee;
10. to shares purchased by a charitable organization (as
defined for purposes of Section 501(c)(3) of the Internal Revenue
Code) investing $100,000 or more;
11. to shares purchased by a bank trust officer, registered
representative, or other employee (or a member of one of their
immediate families) of investment professionals having agreements with
FDC;
12. to shares purchased for a charitable remainder trust or
life income pool established for the benefit of a charitable
organization (as defined for purposes of Section 501(c)(3) of the
Internal Revenue Code);
13. to shares purchased with distributions of income,
principal, and capital gains from Fidelity Defined trusts; or
14. to shares purchased prior to December 31, 1998 by
shareholders who have closed their Fidelity Advisor Class T Municipal
Bond, Fidelity Advisor Class T California Municipal Income, or
Fidelity Advisor Class T New York Municipal Income accounts prior to
December 31, 1997. This waiver is limited to purchases of up to
$10,000; shareholders are entitled to this waiver after the original
load waiver certificate is received by FIIOC.
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) (APPLICABLE TO 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 each transaction available for
each class.
INSTITUTIONAL CLASS SHARES ONLY
Institutional Class shares are offered to:
1. Broker-dealer managed account programs that (i) charge an
asset-based fee and (ii) will have at least $1 million invested in the
Institutional Class of the Advisor funds. In addition, employee
benefit plans (including 403(b) programs, but otherwise as defined by
ERISA) must have at least $50 million in plan assets;
2. Registered investment advisor managed account programs, provided
the registered investment advisor is not part of an organization
primarily engaged in the brokerage business and the program (i)
charges an asset-based fee, and (ii) will have at least $1 million
invested in the Institutional Class of the Advisor funds. In addition,
non-employee benefit plan accounts in the program must be managed on a
discretionary basis;
3. Trust institution and bank trust department managed account
programs that (i) charge an asset-based fee and (ii) will have at
least $1 million invested in the Institutional Class of the Advisor
funds. Accounts managed by third parties are not eligible to purchase
Institutional Class shares;
4. Insurance company separate accounts that will have at least $1
million invested in the Institutional Class of the Advisor funds; and
5. Current or former Trustees or officers of a Fidelity fund or
current or retired officers, directors, or regular employees of FMR
Corp. or Fidelity International Limited or their direct or indirect
subsidiaries (Fidelity Trustee or employee), spouses of Fidelity
Trustees or employees, Fidelity Trustees or employees acting as a
custodian for a minor child, or persons acting as trustee of a trust
for the sole benefit of the minor child of a Fidelity Trustee or
employee.
For purchases made by managed account programs or insurance company
separate accounts, FDC reserves the right to waive the requirement
that $1 million be invested in the Institutional Class of the Advisor
Funds.
FOR CLASS A AND CLASS T SHARES ONLY
FINDER'S FEE. On eligible purchases of (i) Class A shares in amounts
of $1 million or more that qualify for a Class A load waiver, (ii)
Class A shares in amounts of $25 million or more, or (iii) Class T
shares in amounts of $1 million or more, investment professionals will
be compensated with a fee at the rate of 0.25% of the purchase amount.
Class A eligible purchases are the following purchases made through
broker-dealers and banks: an individual trade of $25 million or more;
an individual trade of $1 million or more that is load waived; a trade
which brings the value of the accumulated account(s) of an investor
(including an employee benefit plan (including 403(b) programs, but
otherwise as defined in ERISA)) past $25 million; a load waived trade
that brings the value of the accumulated account(s) of an investor
(including an employee benefit plan (including 403(b) programs, but
otherwise as defined in ERISA)) past $1 million; a trade for an
investor with an accumulated account value of $25 million or more; a
load waived trade for an investor with an accumulated account value of
$1 million or more; an incremental trade toward an investor's $25
million "Letter of Intent"; and an incremental load waived trade
toward an investor's $1 million "Letter of Intent". Class T eligible
purchases are the following purchases made through broker-dealers and
banks: an individual trade of $1 million or more; a trade which brings
the value of the accumulated account(s) of an investor (including an
employee benefit plan (including 403(b) programs, but otherwise as
defined in ERISA)) past $1 million; a trade for an investor with an
accumulated account value of $1 million or more; and an incremental
trade toward an investor's $1 million "Letter of Intent."
For the purpose of determining the availability of Class A or Class T
finder's fees, purchases of Class A or Class T shares made with the
proceeds from the redemption of shares of any Fidelity fund will not
be considered "eligible purchases".
Any assets on which a finder's fee has been paid will bear a
contingent deferred sales charge (Class A or Class T CDSC) if they do
not remain in Class A or Class T shares of the Fidelity Advisor Funds,
or Daily Money Class shares of Treasury Fund, Prime Fund or Tax-Exempt
Fund, for a period of at least one uninterrupted year. The Class A or
Class T CDSC will be 0.25% of the lesser of the cost of the Class A or
Class T shares, as applicable, at the initial date of purchase or the
value of the Class A or Class T shares, as applicable, at redemption,
not including any reinvested dividends or capital gains. Class A and
Class T shares acquired through distributions (dividends or capital
gains) will not be subject to a Class A or Class T CDSC. In
determining the applicability and rate of any Class A or Class T CDSC
at redemption, Class A or Class T shares representing reinvested
dividends and capital gains, if any, will be redeemed first, followed
by those Class A or Class T shares, as applicable, that have been held
for the longest period of time.
With respect to employee benefit plans (including 403(b) programs, but
otherwise as defined in ERISA), the Class A or Class T CDSC does not
apply to the following types of redemptions: (i) plan loans or
distributions or (ii) exchanges to non-Advisor fund investment
options. With respect to Individual Retirement Accounts, the Class A
or Class T CDSC does not apply to redemptions made for disability,
payment of death benefits, or required partial distributions starting
at age 70 1/2.
Investment professionals must notify FDC in advance of a purchase
eligible for a finder's fee, and may be required to enter into an
agreement with FDC in order to receive the finder's fee.
CLASS A, CLASS T, CLASS B, AND CLASS C SHARES ONLY
QUANTITY DISCOUNTS. To obtain a reduction of the front-end sales
charge on Class A or Class T shares, you or your investment
professional must notify Fidelity at the time of purchase whenever a
quantity discount is applicable to your purchase. Upon such
notification, you will receive the lowest applicable front-end sales
charge.
For purposes of qualifying for a reduction in front-end sales charges
under the Combined Purchase, Rights of Accumulation or Letter of
Intent programs, the following may qualify as an individual or a
"company" as defined in Section 2(a)(8) of the 1940 Act: an
individual, spouse, and their children under age 21 purchasing for
his, her, or their own account; a trustee, administrator or other
fiduciary purchasing for a single trust estate or a single fiduciary
account or for a single or a parent-subsidiary group of "employee
benefits plans" (as defined in Section 3(3) of ERISA); and tax-exempt
organizations as defined under Section 501(c)(3) of the Internal
Revenue Code.
RIGHTS OF ACCUMULATION permit reduced front-end sales charges on any
future purchases of Class A or Class T shares after you have reached a
new breakpoint in a fund's sales charge schedule. The value of
currently held (i) Fidelity Advisor fund Class A, Class T, Class B and
Class C shares, (ii) Advisor B Class and C Class shares of Treasury
Fund and (iii) Daily Money Class shares of Treasury Fund, Prime Fund,
and Tax-Exempt Fund acquired by exchange from any Fidelity Advisor
fund, is determined at the current day's NAV at the close of business,
and is added to the amount of your new purchase valued at the current
offering price to determine your reduced front-end sales charge.
LETTER OF INTENT. You may obtain Class A or Class T shares at the same
reduced front-end sales charge by filing a non-binding Letter of
Intent (Letter) within 90 days of the start of Class A or Class T
purchases. Each Class A or Class T investment you make after signing
the Letter will be entitled to the front-end sales charge applicable
to the total investment indicated in the Letter. For example, a $2,500
purchase of Class A or Class T shares toward a $50,000 Letter would
receive the same reduced sales charge as if the $50,000 had been
invested at one time. Purchases of Class B and Class C shares during
the 13-month period also will count toward the completion of the
Letter. To ensure that you receive a reduced front - end sales
charge on future purchases, you or your investment professional must
inform Fidelity that the Letter is in effect each time Class A or
Class T shares are purchased. Reinvested income and capital gain
distributions do not count toward the completion of the Letter.
Your initial investment must be at least 5% of the total amount you
plan to invest. Out of the initial purchase, Class A or Class T shares
equal to 5% of the dollar amount specified in the Letter will be
registered in your name and held in escrow. The Class A or Class T
shares held in escrow cannot be redeemed or exchanged until the Letter
is satisfied or the additional sales charges have been paid. You will
earn income dividends and capital gain distributions on escrowed Class
A or Class T shares. The escrow will be released when your purchase of
the total amount has been completed. You are not obligated to complete
the Letter.
If you purchase more than the amount specified in the Letter and
qualify for a future front-end sales charge reduction, the front-end
sales charge will be adjusted to reflect your total purchase at the
end of 13 months. Surplus funds will be applied to the purchase of
additional Class A or Class T shares at the then-current offering
price applicable to the total purchase.
If you do not complete your purchase under the Letter within the
13-month period, 30 days' written notice will be provided for you to
pay the increased front-end sales charges due. Otherwise, sufficient
escrowed Class A or Class T shares will be redeemed to pay such
charges.
FIDELITY ADVISOR SYSTEMATIC INVESTMENT PROGRAM. You can make regular
investments in Class A, Class T, Class B, Class C or Institutional
Class shares of the funds monthly, bimonthly, quarterly, or
semi-annually with the Systematic Investment Program by completing the
appropriate section of the account application and attaching a voided
personal check with your bank's magnetic ink coding number across the
front. If your bank account is jointly owned, be sure that all owners
sign.
You may cancel your participation in the Systematic Investment Program
at any time without payment of a cancellation fee. You will receive a
confirmation from the transfer agent for every transaction, and a
debit entry will appear on your bank statement.
FIDELITY ADVISOR SYSTEMATIC WITHDRAWAL PROGRAM. If you own Class A,
Class T, or Institutional Class shares worth $10,000 or more, you can
have monthly, quarterly or semi-annual checks sent from your account
to you, to a person named by you, or to your bank checking account. If
you own Class B or Class C shares worth $10,000 or more, you can have
monthly or quarterly checks sent from your account to you, to a person
named by you, or to your bank checking account. Aggregate redemptions
per 12-month period from your Class B or Class C account may not
exceed 10% of the value of the account and are not subject to a CDSC;
and you may set your withdrawal amount as a percentage of the value of
your account or a fixed dollar amount. Your Systematic Withdrawal
Program payments are drawn from Class A, Class T, Class B, Class C, or
Institutional Class share redemptions, as applicable. If Systematic
Withdrawal Plan redemptions exceed income dividends earned on your
shares, your account eventually may be exhausted.
ALL CLASSES
The fund is open for business and each class's net asset value per
share (NAV) is calculated each day the New York Stock Exchange (NYSE)
is open for trading. The NYSE has designated the following holiday
closings for 1998: New Year's Day, Martin Luther King's Birthday,
Presidents' Day, Good Friday, Memorial Day, Independence Day
(observed), Labor Day, Thanksgiving Day, and Christmas Day. Although
FMR expects the same holiday schedule to be observed in the future,
the NYSE may modify its holiday schedule at any time. In addition, on
days when the Federal Reserve Wire System is closed, federal funds
wires cannot be sent.
FSC normally determines each class's NAV as of the close 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
SEC. To the extent that portfolio securities are traded in other
markets on days when the NYSE is closed, a class's NAV may be affected
on days when investors do not have access to the fund to purchase or
redeem shares. In addition, trading in some of a fund's portfolio
securities may not occur on days when the fund is open for business.
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.
Pursuant to Rule 11a-3 under the 1940 Act, the fund is required to
give shareholders at least 60 days' notice prior to terminating or
modifying its exchange privilege. Under the Rule, the 60-day
notification requirement may be waived if (i) the only effect of a
modification would be to reduce or eliminate an administrative fee,
redemption fee, or deferred sales charge ordinarily payable at the
time of an exchange, or (ii) the fund suspends the redemption of the
shares to be exchanged as permitted under the 1940 Act or the rules
and regulations thereunder, or the fund to be acquired suspends the
sale of its shares because it is unable to invest amounts effectively
in accordance with its investment objective and policies.
In the Prospectus, the fund has notified shareholders that it reserves
the right at any time, without prior notice, to refuse exchange
purchases by any person or group if, in FMR's judgment, the fund would
be unable to invest effectively in accordance with its investment
objective and policies, or would otherwise potentially be adversely
affected.
7.DISTRIBUTIONS AND TAXES
DIVIDENDS. A portion of the fund's income may qualify for the
dividends-received deduction available to corporate shareholders to
the extent that the fund's income is derived from qualifying
dividends. Because the fund may earn other types of income, such as
interest, income from securities loans, non-qualifying dividends, and
short-term capital gains, the percentage of dividends from the fund
that qualifies for the deduction generally will be less than 100%. The
fund will notify corporate shareholders annually of the percentage of
fund dividends that qualifies for the dividends-received deduction. A
portion of the fund's dividends derived from certain U.S. Government
securities may be exempt from state and local taxation. Gains (losses)
attributable to foreign currency fluctuations are generally taxable as
ordinary income, and therefore will increase (decrease) dividend
distributions. If the fund's distributions exceed its net investment
company taxable income during a taxable year, all or a portion of the
distributions made in the same taxable year would be recharacterized
as a return of capital to shareholders, thereby reducing each
shareholder's cost basis in the fund. Short-term capital gains are
distributed as dividend income. The fund will send each shareholder a
notice in January describing the tax status of dividends and capital
gain distributions for the prior year.
CAPITAL GAIN DISTRIBUTIONS. Long-term capital gains earned by the fund
on the sale of securities and distributed to shareholders are
federally taxable as long-term capital gains, regardless of the length
of time shareholders have held their shares. If a shareholder receives
a capital gain distribution on shares of the fund, and such shares are
held six months or less and are sold at a loss, the portion of the
loss equal to the amount of the capital gain distribution will be
considered a long-term loss for tax purposes. Short-term capital gains
distributed by the fund are taxable to shareholders as dividends, not
as capital gains.
FOREIGN TAXES. Foreign governments may withhold taxes on dividends and
interest paid with respect to foreign securities. Foreign governments
may also impose taxes on other payments or gains with respect to
foreign securities. Because the fund does not currently anticipate
that securities of foreign issuers will constitute more than 50% of
its total assets at the end of its fiscal year, shareholders should
not expect to claim a foreign tax credit or deduction on their federal
income tax returns with respect to foreign taxes withheld.
TAX STATUS OF THE FUND. The fund intends to qualify each year as a
"regulated investment company" for tax purposes so that it will not be
liable for federal tax on income and capital gains distributed to
shareholders. In order to qualify as a regulated investment company
and avoid being subject to federal income or excise taxes at the fund
level, the fund intends to distribute substantially all of its net
investment income and net realized capital gains within each calendar
year as well as on a fiscal year basis, and intends to comply with
other tax rules applicable to regulated investment companies.
The fund is treated as a separate entity from the other funds of
Advisor Series I for tax purposes.
If a fund purchases shares in certain foreign investment entities,
defined as passive foreign investment companies (PFICs) in the
Internal Revenue Code, it may be subject to U.S. federal income tax on
a portion of any excess distribution or gain from the disposition of
such shares. Interest charges may also be imposed on a fund with
respect to deferred taxes arising from such distributions or gains.
Generally, the fund will elect to mark-to-market any PFIC shares.
Unrealized gains will be recognized as income for tax purposes and
must be distributed to shareholders as dividends.
OTHER TAX INFORMATION. The information above is only a summary of some
of the tax consequences generally affecting the fund and its
shareholders, and no attempt has been made to discuss individual tax
consequences. 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.
8.FMR
All of the stock of FMR is owned by FMR Corp., its parent organized in
1972. 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
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.
9.TRUSTEES AND OFFICERS
The Trustees, Members of the Advisory Board, and executive officers of
the trust are listed below. Except as indicated, each individual has
held the office shown or other offices in the same company for the
last five years. All persons named as Trustees and Members of the
Advisory Board also serve in similar capacities for other funds
advised by FMR. The business address of each Trustee, Member of the
Advisory Board, and officer who is an "interested person" (as defined
in the Investment Company Act of 1940) 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,
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 (54), 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 PLY
(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 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 (64), 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 (69), 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) and Imation Corp. (imaging and
information storage, 1997) .
*ROBERT C. POZEN (51), 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 (69), 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).
ERIC D. ROITER (49), 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 (51), 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).
JOHN H. COSTELLO (51), 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).
The following table sets forth information describing the compensation
of each Trustee and Member of the Advisory Board of the fund for his
or her services for the fiscal year ended November 30, 1998, or
calendar year ended December 31, 1997, as applicable.
COMPENSATION TABLE
Trustees and Aggregate Total
Members of the Advisory Board Compensation Compensation
from the from the
FundB,+ Fund Complex*,A
J. Gary Burkhead** $ 0 $ 0
Ralph F. Cox $ 42 $ 214,500
Phyllis Burke Davis $ 41 $ 210,000
Robert M. Gates*** $ 42 $ 176,000
Edward C. Johnson 3d** $ 0 $ 0
E. Bradley Jones $ 41 $ 211,500
Donald J. Kirk $ 41 $ 211,500
Peter S. Lynch** $ 0 $ 0
William O. McCoy**** $ 42 $ 214,500
Gerald C. McDonough $ 51 $ 264,500
Marvin L. Mann $ 42 $ 214,500
Robert C. Pozen** $ 0 $ 0
Thomas R. Williams $ 42 $ 214,500
* Information is for the calendar year ended December 31, 1997 for 230
funds in the complex.
** Interested Trustees of the fund and Mr. Burkhead are compensated by
FMR.
*** Mr. Gates was elected to the Board of Trustees of Advisor Series I
on July 16, 1997.
**** Mr. McCoy was elected to the Board of Trustees of Advisor Series
I on July 16, 1997.
+ Figures presented are estimated for the fund's first fiscal year
ending November 30, 1998.
A Compensation figures include cash. 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.
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 the public offering of shares of the fund, 100% of each class's
total outstanding shares was held by FMR. FMR Corp. is the ultimate
parent company of FMR. By virtue of his ownership interest in FMR
Corp., as described in the "FMR" section on page 67 , Mr. Edward
C. Johnson 3d, President and Trustee of the fund, may be deemed to be
a beneficial owner of these shares.
10.MANAGEMENT CONTRACT
The fund has entered into a management contract with FMR, pursuant to
which FMR furnishes investment advisory and other services.
MANAGEMENT SERVICES. Under the terms of its management contract with
the fund, FMR acts as investment adviser and, subject to the
supervision of the Board of Trustees, directs the investments of the
fund in accordance with its investment objective, policies, and
limitations. FMR also provides the fund with all necessary office
facilities and personnel for servicing the fund's investments,
compensates all officers of the fund and all Trustees who are
"interested persons" of the trust or of FMR, and all personnel of the
fund or FMR performing services relating to research, statistical, and
investment activities.
In addition, FMR or its affiliates, subject to the supervision of the
Board of Trustees, provide the management and administrative services
necessary for the operation of the fund. These services include
providing facilities for maintaining the fund's organization;
supervising relations with custodians, transfer and pricing agents,
accountants, underwriters, and other persons dealing with the fund;
preparing all general shareholder communications and conducting
shareholder relations; maintaining the fund's records and the
registration of the fund's shares under federal securities laws and
making necessary filings under state securities laws; developing
management and shareholder services for the fund; and furnishing
reports, evaluations, and analyses on a variety of subjects to the
Trustees.
MANAGEMENT-RELATED EXPENSES. In addition to the management fee payable
to FMR and the fees payable to the transfer, dividend disbursing, and
shareholder servicing agent, pricing and bookkeeping agent, and
securities lending agent. The fund, or each class thereof, as
applicable, pays all of its expenses that are not assumed by those
parties. The fund pays for the typesetting, printing, and mailing of
its proxy materials to shareholders, legal expenses, and the fees of
the custodian, auditor and non-interested Trustees. The fund's
management contract further provides that the fund will pay for
typesetting, printing, and mailing prospectuses, statements of
additional information, notices, and reports to shareholders; however,
under the terms of the fund's transfer agent agreement, the transfer
agent bears the costs of providing these services to existing
shareholders of the applicable classes. Other expenses paid by the
fund include interest, taxes, brokerage commissions, the fund's
proportionate share of insurance premiums and Investment Company
Institute dues, and the costs of registering shares under federal
securities laws and making necessary filings under state securities
law. The fund is also liable for such non-recurring expenses as may
arise, including costs of any litigation to which the fund may be a
party, and any obligation it may have to indemnify its officers and
Trustees with respect to litigation.
MANAGEMENT FEE. For the services of FMR under the management contract,
the fund pays FMR a monthly management fee which has two components: a
group fee rate and an individual fund fee rate.
The group fee rate is based on the monthly average net assets of all
of the registered investment companies with which FMR has management
contracts.
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES
Average Group Annualized Group Net Effective Annual Fee
Assets Rate Assets Rate
0 - $3 billion .5200% $ 0.5 billion .5200%
3 - 6 .4900 25 .4238
6 - 9 .4600 50 .3823
9 - 12 .4300 75 .3626
12 - 15 .4000 100 .3512
15 - 18 .3850 125 .3430
18 - 21 .3700 150 .3371
21 - 24 .3600 175 .3325
24 - 30 .3500 200 .3284
30 - 36 .3450 225 .3249
36 - 42 .3400 250 .3219
42 - 48 .3350 275 .3190
48 - 66 .3250 300 .3163
66 - 84 .3200 325 .3137
84 - 102 .3150 350 .3113
102 - 138 .3100 375 .3090
138 - 174 .3050 400 .3067
174 - 210 .3000 425 .3046
210 - 246 .2950 450 .3024
246 - 282 .2900 475 .3003
282 - 318 .2850 500 .2982
318 - 354 .2800 525 .2962
354 - 390 .2750 550 .2924
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over 534 .2500
The group fee rate is calculated on a cumulative basis pursuant to the
graduated fee rate schedule shown above on the left. The schedule
above on the right shows the effective annual group fee rate at
various asset levels, which is the result of cumulatively applying the
annualized rates on the left. For example, the effective annual fee
rate at $ 647 billion of group net assets - the approximate
level for July 1998 - was 0.2875 %, which is the weighted
average of the respective fee rates for each level of group net assets
up to $ 647 billion.
The fund's individual fund fee rate is 0.45%. Based on the average
group net assets of the funds advised by FMR for July 1998, the
fund's annual management fee rate would be calculated as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Group Fee Rate Individual Fund Fee Rate Management Fee Rate
Advisor Small Cap Fund 0. 2875 % + 0.45% = 0. 7375 %
</TABLE>
One-twelfth of this annual management fee rate is applied to the
fund's net assets averaged for the most recent month, giving a dollar
amount, which is the fee for that month.
FMR may, from time to time, voluntarily reimburse all or a portion of
each 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 repayment of the reimbursement by a class will lower its total
returns.
Effective September 6, 1998, FMR voluntarily agreed to reimburse Class
A, Class T, Class B, Class C and Institutional Class if and to the
extent that its aggregate operating expenses, including management
fees, were in excess of an annual rate of 1.75%, 2.00%, 2.50%, 2.50%
and 1.50%, respectively, of its average net assets.
SUB-ADVISERS. On behalf of the fund, FMR has entered into sub-advisory
agreements with FMR U.K. and FMR Far East. Pursuant to the
sub-advisory agreements, FMR may receive investment advice and
research services outside the United States from the sub-advisers.
On behalf of the fund, FMR may also grant the sub-advisers investment
management authority as well as the authority to buy and sell
securities if FMR believes it would be beneficial to the fund.
Currently, FMR U.K. and FMR Far East each focus on issuers in
countries other than the United States such as those in Europe, Asia,
and the Pacific Basin.
FMR U.K. and FMR Far East, which were organized in 1986, are wholly
owned subsidiaries of FMR. Under the sub-advisory agreements FMR pays
the fees of FMR U.K. and FMR Far East. For providing non-discretionary
investment advice and research services, FMR pays FMR U.K. and FMR Far
East fees equal to 110% and 105%, respectively, of FMR U.K.'s and FMR
Far East's costs incurred in connection with providing investment
advice and research services.
On behalf of the fund, for providing discretionary investment
management and executing portfolio transactions, FMR pays FMR U.K. and
FMR Far East a fee equal to 50% of its monthly management fee rate
with respect to the fund's average net assets managed by the
sub-adviser on a discretionary basis.
11.DISTRIBUTION AND SERVICE PLANS
The Trustees have approved Distribution and Service Plans on behalf of
Class A, Class T, Class B, Class C, and Institutional Class shares of
the 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 Class A, Class T, Class B,
Class C, and Institutional Class shares of the fund and FMR to incur
certain expenses that might be considered to constitute direct or
indirect payment by the fund of distribution expenses.
Pursuant to the Class A, Class T, Class B, and Class C Plans, FDC is
paid a monthly distribution fee at an annual rate of up to 0.75% of
each class's average net assets. For the purpose of calculating the
distribution fees, average net assets are determined at the close of
business on each day throughout the month. Currently, the Trustees
have approved a distribution fee for Class A at an annual rate of
0.25% of its average net assets; a distribution fee for Class T at an
annual rate of 0.50% of its average net assets; a distribution fee for
Class B and Class C at an annual rate of 0.75% of each of Class B's
and Class C's average net assets. The fee rates for Class A and Class
T may be increased only when, in the opinion of the Trustees, it is in
the best interests of the shareholders of the applicable class to do
so. Class B and Class C also pay investment professionals a service
fee at an annual rate of 0.25% of Class B's and Class C's average
daily net assets determined at the close of business on each day
throughout the month for personal service and/or the maintenance of
shareholder accounts.
Currently the full amount of distribution fees paid by Class A and
Class T is reallowed to investment professionals as
compensation for their services in connection with the distribution of
Class A or Class T shares, as applicable, and for providing support
services to Class A or Class T shareholders, as applicable, based upon
the level of services provided.
Currently, the full amount of distribution fees paid by Class B is
retained by FDC as compensation for its services and expenses in
connection with the distribution of Class B shares, and the full
amount of service fees paid by Class B is reallowed to investment
professionals for providing personal service to and/or
maintenance of Class B shareholder accounts.
Currently, and except as provided below, for the first year of
investment, the full amount of distribution fees paid by Class C is
retained by FDC as compensation for its services and expenses in
connection with the distribution of Class C shares, and the full
amount of service fees paid by Class C is retained by FDC for
providing personal service to and/or maintenance of Class C
shareholder accounts. Normally, after the first year of investment,
up to the full amount of distribution fees paid by Class C
may be reallowed to investment professionals as compensation
for their services in connection with the distribution of Class C
shares, and up to the full amount of service fees paid by Class
C may be reallowed to investment professionals for providing
p ersonal service to and/or maintenance of Class C shareholder
accounts. For purchases of Class C shares made for an employee benefit
plan (including 403(b) programs, but otherwise as defined in ERISA)
or through reinvested dividends or capital gain distributions ,
during the first year of investment and thereafter, up to the
full amount of distribution fees and service fees paid by such Class C
shares may be reallowed to investment professionals as
compensation for their services in connection with the distribution of
Class C shares and for providing personal service to and/or
maintenance of Class C shareholder accounts.
Under the Institutional Class Plan, if the payment of management fees
by the fund to FMR is deemed to be indirect financing by the fund of
the distribution of its shares, such payment is authorized by the
Plan. The Institutional Class 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 the distribution of Institutional Class shares. In addition, the
Institutional Class Plan provides that FMR, directly or through FDC,
may make payments to third parties, such as banks or broker-dealers,
that engage in the sale of Institutional Class shares, or provide
shareholder support services. Currently, the Board of Trustees has
authorized such payments for Institutional Class shares.
Under the Class A, Class T, Class B, and Class C Plans, 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 Plans. The Class A, Class T, Class B, and Class C
Plans specifically recognize 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 the distribution of Class
A, Class T, Class B, or Class C shares, including payments made to
third parties that engage in the sale of Class A, Class T, Class B, or
Class C shares or to third parties, including banks, that provide
shareholder support services. Currently, the Board of Trustees has
authorized such payments for Class A, Class T, 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 the fund and its shareholders. In
particular, the Trustees noted that the Institutional Class Plan does
not authorize payments by the Institutional Class of the fund other
than those made to FMR under its management contract with the fund. To
the extent that each Plan gives FMR and FDC greater flexibility in
connection with the distribution of shares of the applicable class,
additional sales of fund shares may result. Furthermore, certain
shareholder support services may be provided more effectively under
the Plans by local entities with whom shareholders have other
relationships.
The Class A, Class T, Class B, and Class C Plans do 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 fund might occur, including possible termination of
any automatic investment or redemption or other services then provided
by the bank. It is not expected that shareholders would suffer any
adverse financial consequences as a result of any of these
occurrences. In addition, state securities laws on this issue may
differ from the interpretations of federal law expressed herein, and
banks and other financial institutions may be required to register as
dealers pursuant to state law.
The fund may execute portfolio transactions with, and purchase
securities issued by, depository institutions that receive payments
under the Plans. No preference for the instruments of such depository
institutions will be shown in the selection of investments.
12.CONTRACTS WITH FMR AFFILIATES
Each class of the fund has entered into a transfer agent agreement
with FIIOC, an affiliate of FMR. Under the terms of the agreement,
FIIOC performs transfer agency, dividend disbursing, and shareholder
services for each class of the fund.
For providing transfer agency services, FIIOC receives an account fee
and an asset-based fee each paid monthly with respect to each account
in the fund. For retail accounts and certain institutional accounts,
these fees are based on account size and fund type. For certain
institutional retirement accounts, these fees are based on fund type.
For certain other institutional retirement accounts, these fees are
based on account type (i.e., omnibus or non-omnibus) and, for
non-omnibus accounts, fund type. The account fees are subject to
increase based on postage rate changes.
The asset-based fees are subject to adjustment if the year-to-date
total return of the S&P 500 exceeds a positive or negative 15%.
FIIOC also collects small account fees from certain accounts with
balances of less than $2,500.
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.
The fund has also entered into a service agent agreement with FSC, an
affiliate of FMR. Under the terms of the agreement, FSC calculates the
NAV and dividends for each class of the fund, maintains the fund's
portfolio and general accounting records, and administers the fund's
securities lending program.
For providing pricing and bookkeeping services, FSC receives a monthly
fee based on the fund's average daily net assets throughout the month.
The annual fee rates for pricing and bookkeeping services are: 0.0600%
of the first $500 million of average net assets and 0.0300% 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
$60,000 and a maximum of $800,000 per year.
For administering the fund's securities lending program, FSC receives
fees based on the number and duration of individual securities loans.
The fund has entered into a distribution agreement with FDC, an
affiliate of FMR organized as a Massachusetts corporation on July 18,
1960. FDC is a broker-dealer registered under the Securities Exchange
Act of 1934 and a member of the National Association of Securities
Dealers, Inc. The distribution agreement calls for FDC to use all
reasonable efforts, consistent with its other business, to secure
purchasers for shares of the fund, which are continuously offered.
Promotional and administrative expenses in connection with the offer
and sale of shares are paid by FMR.
13.DESCRIPTION OF THE TRUST
TRUST ORGANIZATION. Fidelity Advisor Small Cap Fund is a fund of
Fidelity Advisor Series I, an open-end management investment company
organized as a Massachusetts business trust by a Declaration of Trust
dated June 24, 1983, as amended and restated October 26, 1984. On
January 29, 1992, the name was changed from Equity Portfolio Growth to
Fidelity Broad Street Trust by an amendment to the Declaration of
Trust. On April 15, 1993, its name was changed from Fidelity Broad
Street Trust to Fidelity Advisor Series I by an amendment to the
Declaration of Trust. Currently, there are eight funds of the trust:
Fidelity Advisor TechnoQuant Growth Fund, Fidelity Advisor Mid Cap
Fund, Fidelity Advisor Equity Growth Fund, Fidelity Advisor Growth
Opportunities Fund, Fidelity Advisor Strategic Opportunities Fund,
Fidelity Advisor Large Cap Fund, Fidelity Advisor Growth & Income
Fund, and Fidelity Advisor Small Cap Fund.
In the event that FMR ceases to be the investment adviser to the trust
or a fund, the right of the trust or fund to use the identifying name
"Fidelity" may be withdrawn.
The assets of the trust received for the issue or sale of shares of
each fund and all income, earnings, profits, and proceeds thereof,
subject only to the rights of creditors, are especially allocated to
such fund, and constitute the underlying assets of such fund. The
underlying assets of each fund are segregated on the books of account,
and are to be charged with the liabilities with respect to such fund
and with a share of the general expenses of the trust. Expenses with
respect to the trust are to be allocated in proportion to the asset
value of the respective funds, except where allocations of direct
expense can otherwise be fairly made. The officers of the trust,
subject to the general supervision of the Board of Trustees, have the
power to determine which expenses are allocable to a given fund, or
which are general or allocable to all of the funds. In the event of
the dissolution or liquidation of the trust, shareholders of each fund
are entitled to receive as a class the underlying assets of such fund
available for distribution.
SHAREHOLDER AND TRUSTEE LIABILITY. The trust is an entity of the type
commonly known as a "Massachusetts business trust." Under
Massachusetts law, shareholders of such a trust may, under certain
circumstances, be held personally liable for the obligations of the
trust. The Declaration of Trust 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 shall
include a provision limiting the obligations created thereby to the
trust and its assets. The Declaration of Trust provides for
indemnification out of each fund's property of any shareholder held
personally liable for the obligations of the fund. The Declaration of
Trust also provides that its funds shall, upon request, assume the
defense of any claim made against any shareholder for any act or
obligation of the fund and satisfy any judgment thereon. Thus, the
risk of a shareholder incurring financial loss on account of
shareholder liability is limited to circumstances in which the fund
itself would be unable to meet its obligations. FMR believes that, in
view of the above, the risk of personal liability to shareholders is
remote.
The Declaration of Trust further provides that the Trustees, if they
have exercised reasonable care, will not be liable for any neglect or
wrongdoing, but nothing in the Declaration of Trust protects Trustees
against any liability to which they would otherwise be subject by
reason of willful misfeasance, bad faith, gross negligence, or
reckless disregard of the duties involved in the conduct of their
office. 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 receive one vote for each dollar value
of net asset value you own. The shares have no preemptive rights and
Class A, Class T, Class C, and Institutional Class shares have no
conversion rights; the voting and dividend rights, the conversion
rights of Class B shares, the right of redemption, and the privilege
of exchange are described in the Prospectus. Shares are fully paid and
nonassessable, except as set forth under the heading "Shareholder and
Trustee Liability" above. Shareholders representing 10% or more of the
trust, a fund, or class of a fund may, as set forth in the Declaration
of Trust, call meetings of a trust, fund or class, as applicable, for
any purpose related to the trust, fund, or class, as the case may be,
including, in the case of a meeting of the entire trust, the purpose
of voting on removal of one or more Trustees. The trust or any fund
may be terminated upon the sale of its assets to another open-end
management investment company, or upon liquidation and distribution of
its assets, if approved by vote of the holders of a majority of the
trust or the fund, as determined by the current value of each
shareholder's investment in the fund or trust. If not so terminated,
the trust and its funds will continue indefinitely. Each fund may
invest all of its assets in another investment company.
CUSTODIAN. State Street Bank and Trust Company, 1776 Heritage Drive,
North Quincy, Massachusetts is custodian of the assets of the fund.
The custodian is responsible for the safekeeping of a fund's assets
and the appointment of any subcustodian banks and clearing agencies.
The custodian takes no part in determining the investment policies of
a fund or in deciding which securities are purchased or sold by a
fund. However, a fund may invest in obligations of its custodian and
may purchase securities from or sell securities to the custodian. The
Bank of New York and The Chase Manhattan Bank, each headquartered in
New York, also may serve as special purpose custodians of certain
assets in connection with repurchase agreement transactions.
FMR, its officers and directors, its affiliated companies, and 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 fund and provides
other audit, tax, and related services.
14.APPENDIX
DESCRIPTION OF MOODY'S INVESTORS SERVICE RATINGS OF CORPORATE BONDS
Moody's ratings for obligations with an original remaining maturity in
excess of one year fall within nine categories. They range from Aaa
(highest quality) to C (lowest quality). Moody's applies numerical
modifiers of 1, 2, or 3 to each generic rating classification from Aa
through B. The modifier 1 indicates that the security ranks in the
higher end of its generic rating category; the modifier 2 indicates a
mid-range ranking; and the modifier 3 indicates that the issue ranks
on the lower end of its generic rating category.
AAA - Bonds that are rated Aaa are judged to be of the best quality.
They carry the smallest degree of investment risk and are generally
referred to as "gilt edged." Interest payments are protected by a
large or by an exceptionally stable margin and principal is secure.
While the various protective elements are likely to change, such
changes as can be visualized are most unlikely to impair the
fundamentally strong position of such issues.
AA - Bonds that are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are
generally known as high-grade bonds. They are rated lower than the
best bonds because margins of protection may not be as large as in Aaa
securities or fluctuation of protective elements may be of greater
amplitude or there may be other elements present which make the
long-term risks appear somewhat larger than the Aaa securities.
A - Bonds that are rated A possess many favorable investment
attributes and are to be considered as upper-medium-grade obligations.
Factors giving security to principal and interest are considered
adequate but elements may be present which suggest a susceptibility to
impairment sometime in the future.
BAA - Bonds that are rated Baa are considered as medium-grade
obligations, (i.e., they are neither highly protected nor poorly
secured). Interest payments and principal security appear adequate for
the present but certain protective elements may be lacking or may be
characteristically unreliable over any great length of time. Such
bonds lack outstanding investment characteristics and in fact have
speculative characteristics as well.
BA - Bonds that are rated Ba are judged to have speculative elements;
their future cannot be considered as well assured. Often the
protection of interest and principal payments may be very moderate and
thereby not well safeguarded during both good and bad times over the
future. Uncertainty of position characterizes bonds in this class.
B - Bonds that are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or
of maintenance of other terms of the contract over any long period of
time may be small.
CAA - Bonds that are rated Caa are of poor standing. Such issues may
be in default or there may be present elements of danger with respect
to principal or interest.
CA - Bonds that are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in default or have
other marked short-comings.
C - Bonds that are rated C are the lowest-rated class of bonds and
issues so rated can be regarded as having extremely poor prospects of
ever attaining any real investment standing.
DESCRIPTION OF STANDARD & POOR'S RATINGS OF CORPORATE BONDS
Debt issues may be designated by Standard & Poor's as either
investment grade ("AAA" through "BBB") or speculative grade ("BB"
through "D"). While speculative grade debt will likely have some
quality and protective characteristics, these are outweighed by large
uncertainties or major exposures to adverse conditions. Ratings from
AA to CCC may be modified by the addition of a plus sign (+) or minus
sign (-) to show relative standing within the major rating categories.
AAA - Debt rated AAA has the highest rating assigned by Standard &
Poor's to a debt obligation. Capacity to pay interest and repay
principal is extremely strong.
AA - Debt rated AA has a very strong capacity to pay interest and
repay principal and differs from the higher-rated issues only in small
degree.
A - Debt rated A has a strong capacity to pay interest and repay
principal, although it is somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than debt
in higher rated categories.
BBB - Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate
protection parameters, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity to pay
interest and repay principal for debt in this category than in
higher-rated categories.
BB - Debt rated BB has less near-term vulnerability to default than
other speculative issues. However, it faces major ongoing
uncertainties or exposure to adverse business, financial, or economic
conditions which could lead to inadequate capacity to meet timely
interest and principal payments. The BB rating category is also used
for debt subordinated to senior debt that is assigned an actual or
implied BBB - rating.
B - Debt rated B has a greater vulnerability to default but currently
has the capacity to meet interest payments and principal repayments.
Adverse business, financial, or economic conditions will likely impair
capacity or willingness to pay interest and repay principal. The B
rating category is also used for debt subordinated to senior debt that
is assigned an actual or implied BB or BB- rating.
CCC - Debt rated CCC has a currently identifiable vulnerability to
default, and is dependent upon favorable business, financial, and
economic conditions to meet timely payment of interest and repayment
of principal. In the event of adverse business, financial, or economic
conditions, it is not likely to have the capacity to pay interest and
repay principal. The CCC rating category is also used for debt
subordinated to senior debt that is assigned an actual or implied B or
B - rating.
CC - Debt rated CC is typically applied to debt subordinated to senior
debt which is assigned an actual or implied CCC debt rating.
C - The rating C is typically applied to debt subordinated to senior
debt which is assigned an actual or implied CCC - debt rating.
The C rating may be used to cover a situation where a bankruptcy
petition has been filed but debt service payments are continued.
CI - The rating CI is reserved for income bonds on which no interest
is being paid.
D - Debt rated D is in payment default. The D rating category is used
when interest payments or principal payments are not made on the date
due even if the applicable grace period has not expired, unless S&P
believes that such payments will be made during such grace period. The
D rating will also be used upon the filing of a bankruptcy petition if
debt service payments are jeopardized.
Fidelity and Fidelity Focus are registered trademarks of FMR Corp.
The third party marks appearing above are the marks of their
respective owners.
PART C. OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Not applicable
(b) Exhibits:
(1) (a) Amended and Restated Declaration of Trust, dated October 26,
1984, is incorporated herein by reference to Exhibit 1(a) of
Post-Effective Amendment No. 31.
(b) Supplement to the Declaration of Trust, dated February 10, 1987,
is incorporated herein by reference to Exhibit 1(b) of Post-Effective
Amendment No. 31.
(c) Supplement to the Declaration of Trust, dated November 26, 1990,
is incorporated herein by reference to Exhibit 1(c) of Post-Effective
Amendment No. 31.
(d) Supplement to the Declaration of Trust, dated December 20, 1991,
is incorporated herein by reference to Exhibit 1(e) of Post-Effective
Amendment No. 31.
(e) Amendment to the Declaration of Trust, dated May 3, 1993, is
incorporated herein by reference to Exhibit 1(f) of Post-Effective
Amendment No. 31.
(f) Supplement to the Declaration of Trust, dated August 25, 1997,
is incorporated herein by reference to Exhibit 1(f) of Post-Effective
Amendment No. 41.
(2) By-Laws of the Trust are incorporated herein by reference to
Exhibit 2 of Post-Effective Amendment No. 41.
(3) Not applicable.
(4) Not applicable.
(5) (a) Management Contract between Fidelity Advisor Equity Growth
Fund and Fidelity Management & Research Company, dated, September 1,
1997, is incorporated herein by reference to Exhibit 5(a) of
Post-Effective Amendment No. 41.
(b) Management Contract between Fidelity Advisor Mid Cap Fund and
Fidelity Management & Research Company, dated January 18, 1996, is
incorporated herein by reference to Exhibit 5(b) of Post-Effective
Amendment No. 32.
(c) Management Contract between Fidelity Advisor Large Cap Fund and
Fidelity Management & Research Company dated, January 18, 1996, is
incorporated herein by reference to Exhibit 5(c) of Post-Effective
Amendment No. 32.
(d) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Equity Growth Fund, and
Fidelity Management & Research (U.K.) Inc., dated September 1, 1997,
is incorporated herein by reference to Exhibit 5(d) of Post-Effective
Amendment No. 41.
(e) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Equity Growth Fund, and
Fidelity Management & Research (Far East) Inc., dated September 1,
1997, is incorporated herein by reference to Exhibit 5(e) of
Post-Effective Amendment No. 41.
(f) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Mid Cap Fund, and Fidelity
Management & Research (U.K.) Inc., dated January 18, 1996, is
incorporated herein by reference to Exhibit 5(f) of Post-Effective
Amendment No. 32.
(g) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Mid Cap Fund, and Fidelity
Management & Research (Far East) Inc., dated January 18, 1996, is
incorporated herein by reference to Exhibit 5(g) of Post-Effective
Amendment No. 32.
(h) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Large Cap Fund, and Fidelity
Management & Research (U.K.) Inc., dated January 18, 1996, is
incorporated herein by reference to Exhibit 5(h) of Post-Effective
Amendment No. 32.
(i) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Large Cap Fund, and Fidelity
Management & Research (Far East) Inc., dated January 18, 1996, is
incorporated herein by reference to Exhibit 5(i) of Post-Effective
Amendment No. 32.
(j) Management Contract between Fidelity Advisor Growth & Income
Fund and Fidelity Management & Research Company, dated December 1,
1996, is incorporated herein by reference to Exhibit 5(j) of
Post-Effective Amendment No. 38.
(k) Management Contract between Fidelity Advisor TechnoQuant Growth
Fund and Fidelity Management & Research Company, dated December 1,
1996, is incorporated herein by reference to Exhibit 5(k) of
Post-Effective Amendment No. 38.
(l) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Growth & Income Fund, and
Fidelity Management & Research (U.K.) Inc., dated December 1, 1996, is
incorporated herein by reference to Exhibit 5(l) of Post-Effective
Amendment No. 38.
(m) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Growth & Income Fund, and
Fidelity Management & Research (Far East) Inc., dated December 1,
1996, is incorporated herein by reference to Exhibit 5(m) of
Post-Effective Amendment No. 38.
(n) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor TechnoQuant Growth Fund, and
Fidelity Management & Research (U.K.) Inc., dated December 1, 1996, is
incorporated herein by reference to Exhibit 5(n) of Post-Effective
Amendment No. 38.
(o) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor TechnoQuant Growth Fund, and
Fidelity Management & Research (Far East) Inc., dated December 1,
1996, is incorporated herein by reference to Exhibit 5(o) of
Post-Effective Amendment No. 38.
(p) Management Contract between Fidelity Advisor Growth
Opportunities Fund and Fidelity Management & Research Company, dated
February 28, 1998, is incorporated herein by reference to Exhibit 5(p)
of Post-Effective Amendment No. 43.
(q) Management Contract between Fidelity Advisor Strategic
Opportunities Fund and Fidelity Management & Research Company, dated
February 28, 1998, is incorporated herein by reference to Exhibit 5(q)
of Post-Effective Amendment No. 43.
(r) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Growth Opportunities Fund, and
Fidelity Management & Research (U.K.) Inc., dated February 28, 1998,
is incorporated herein by reference to Exhibit 5(r) of Post-Effective
Amendment No. 43.
(s) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Strategic Opportunities Fund,
and Fidelity Management & Research (U.K.) Inc., dated February 28,
1998, is incorporated herein by reference to Exhibit 5(s) of
Post-Effective Amendment No. 43.
(t) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Growth Opportunities Fund, and
Fidelity Management & Research (Far East) Inc., dated February 28,
1998, is incorporated herein by reference to Exhibit 5(t) of
Post-Effective Amendment No. 43.
(u) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Strategic Opportunities Fund,
and Fidelity Management & Research (Far East) Inc., dated February 28,
1998, is incorporated herein by reference to Exhibit 5(u) of
Post-Effective Amendment No. 43.
(v) Management Contract between Fidelity Advisor Small Cap Fund and
Fidelity Management & Research Company, dated July 16, 1998, is filed
herein as Exhibit 5(v).
(w) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Small Cap Fund, and Fidelity
Management & Research (U.K.) Inc., dated July 16, 1998 is filed herein
as Exhibit 5(w).
(x) Sub-Advisory Agreement between Fidelity Management & Research
Company, on behalf of Fidelity Advisor Small Cap Fund, and Fidelity
Management & Research (Far East) Inc., dated July 16, 1998, is filed
herein as Exhibit 5(x).
(6) (a) General Distribution Agreement between Fidelity Advisor
Equity Portfolio Growth (currently known as Fidelity Advisor Equity
Growth Fund) and Fidelity Distributors Corporation, dated April 1,
1987, is incorporated herein by reference to Exhibit 6(a) of
Post-Effective Amendment No. 29.
(b) Amendment to the General Distribution Agreement for Fidelity
Equity Portfolio Growth (currently known as Fidelity Advisor Equity
Growth Fund), dated January 1, 1988, is incorporated herein by
reference to Exhibit 6(b) of Post-Effective Amendment No. 29.
(c) General Distribution Agreement between Fidelity Advisor Mid Cap
Fund and Fidelity Distributors Corporation, dated January 18, 1996, is
incorporated herein by reference to Exhibit 6(c) of Post-Effective
Amendment No. 32.
(d) General Distribution Agreement between Fidelity Advisor Large
Cap Fund and Fidelity Distributors Corporation, dated January 18,
1996, is incorporated herein by reference to Exhibit 6(d) of
Post-Effective Amendment No. 32.
(e) Amendments to the General Distribution Agreement between
Fidelity Advisor Series I on behalf of Fidelity Advisor Equity Growth
Fund, Fidelity Advisor Mid Cap Fund, and Fidelity Advisor Large Cap
Fund and Fidelity Distributors Corporation, dated March 14, 1996 and
July 15, 1996, are incorporated herein by reference to Exhibit 6(a) of
Fidelity Court Street Trust's Post-Effective Amendment No. 61 (File
No. 2-58774).
(f) General Distribution Agreement between Fidelity Advisor Growth &
Income Fund and Fidelity Distributors Corporation, dated December 1,
1996, is incorporated herein by reference to Exhibit 6(h) of
Post-Effective Amendment No. 38.
(g) General Distribution Agreement between Fidelity Advisor
TechnoQuant Growth Fund and Fidelity Distributors Corporation, dated
December 1, 1996, is incorporated herein by reference to Exhibit 6(i)
of Post-Effective Amendment No. 38.
(h) General Distribution Agreement between Fidelity Advisor Growth
Opportunities Fund and Fidelity Distributors Corporation, dated
February 28, 1998, is incorporated herein by reference to Exhibit 6(h)
of Post-Effective Amendment No. 43.
(i) General Distribution Agreement between Fidelity Advisor
Strategic Opportunities Fund and Fidelity Distributors Corporation,
dated February 28, 1998, is incorporated herein by reference to
Exhibit 6(i) of Post-Effective Amendment No. 43.
(j) General Distribution Agreement between Fidelity Advisor Small
Cap Fund and Fidelity Distributors Corporation, dated July 16, 1998,
is filed herein as Exhibit 6(j)
(k) Form of Bank Agency Agreement (most recently revised January,
1997) is incorporated herein by reference to Exhibit 6(j) of
Post-Effective Amendment No. 43.
(l) Form of Selling Dealer Agreement (most recently revised January,
1997) is incorporated herein by reference to Exhibit 6(k) of
Post-Effective Amendment No. 43.
(m) Form of Selling Dealer Agreement for Bank-Related Transactions
(most recently revised January, 1997) is incorporated herein by
reference to Exhibit 6(l) of Post-Effective Amendment No. 43.
(7) (a) 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.
(b) 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.
(8) (a) Custodian Agreement and Appendix C, dated August 1, 1994,
between The Chase Manhattan Bank, N.A. and Fidelity Advisor Series I
on behalf of Fidelity Advisor Equity Growth Fund is incorporated
herein by reference to Exhibit 8(a) of Fidelity Investment Trust's
Post-Effective Amendment No. 59 (File No. 2-90649).
(b) Appendix A, dated October 17, 1996, to the Custodian Agreement,
dated August 1, 1994, between The Chase Manhattan Bank, N.A. and
Fidelity Advisor Series I on behalf of Fidelity Advisor Equity Growth
Fund is incorporated herein by reference to Exhibit 8(c) of Fidelity
Charles Street Trust's Post-Effective Amendment No. 57 (File No.
2-73133).
(c) Appendix B, dated September 18, 1997, to the Custodian
Agreement, dated August 1, 1994, between The Chase Manhattan Bank,
N.A. and Fidelity Advisor Series I on behalf of Fidelity Advisor
Equity Growth Fund is incorporated herein by reference to Exhibit 8(b)
of Fidelity Charles Street Trust's Post-Effective Amendment No. 62
(File No. 2-73133).
(d) Custodian Agreement and Appendix C, dated September 1, 1994,
between Brown Brothers Harriman & Company and Fidelity Advisor Series
I on behalf of Fidelity Advisor Mid Cap Fund and Fidelity Advisor
Large Cap Fund is incorporated herein by reference to Exhibit 8(a) of
Fidelity Commonwealth Trust's Post-Effective Amendment No. 56 (File
No. 2-52322).
(e) Appendix A, dated October 16, 1997, to the Custodian Agreement,
dated September 1, 1994, between Brown Brothers Harriman & Company and
Fidelity Advisor Series I on behalf of Fidelity Advisor Mid Cap Fund
and Fidelity Advisor Large Cap Fund is incorporated herein by
reference to Exhibit 8(b) of Fidelity Contrafund's Post-Effective
Amendment No. 50 (File No. 2-25235).
(f) Appendix B, dated September 18, 1997, to the Custodian
Agreement, dated September 1, 1994, between Brown Brothers Harriman &
Company and Fidelity Advisor Series I on behalf of Fidelity Advisor
Mid Cap Fund and Fidelity Advisor Large Cap Fund is incorporated
herein by reference to Exhibit 8(c) of Fidelity Contrafund's
Post-Effective Amendment No. 50 (File No. 2-25235).
(g) Fidelity Group Repo Custodian Agreement among The Bank of New
York, J. P. Morgan Securities, Inc., and Fidelity Advisor Series I on
behalf of Fidelity Equity Portfolio Growth (currently known as
Fidelity Advisor Equity Growth Fund), Fidelity Advisor Mid Cap Fund,
and Fidelity Advisor Large Cap Fund, dated February 12, 1996, is
incorporated herein by reference to Exhibit 8(d) of Fidelity
Institutional Cash Portfolio's (File No. 2-74808) Post-Effective
Amendment No. 31.
(h) Schedule 1 to the Fidelity Group Repo Custodian Agreement
between The Bank of New York and Fidelity Advisor Series I on behalf
of Fidelity Equity Portfolio Growth (currently known as Fidelity
Advisor Equity Growth Fund), Fidelity Advisor Mid Cap Fund, and
Fidelity Advisor Large Cap Fund, dated February 12, 1996, is
incorporated herein by reference to Exhibit 8(e) of Fidelity
Institutional Cash Portfolios' (File No. 2-74808) Post-Effective
Amendment No. 31.
(i) Fidelity Group Repo Custodian Agreement among Chemical Bank,
Greenwich Capital Markets, Inc., and Fidelity Advisor Series I on
behalf of Fidelity Equity Portfolio Growth (currently known as
Fidelity Advisor Equity Growth Fund), Fidelity Advisor Mid Cap Fund,
and Fidelity Advisor Large Cap Fund, dated November 13, 1995, is
incorporated herein by reference to Exhibit 8(f) of Fidelity
Institutional Cash Portfolios' (File No. 2-74808) Post-Effective
Amendment No. 31.
(j) Schedule 1 to the Fidelity Group Repo Custodian Agreement
between Chemical Bank and Fidelity Advisor Series I on behalf of
Fidelity Equity Portfolio Growth (currently known as Fidelity Advisor
Equity Growth Fund), Fidelity Advisor Mid Cap Fund, and Fidelity
Advisor Large Cap Fund, dated November 13, 1995, is incorporated
herein by reference to Exhibit 8(g) of Fidelity Institutional Cash
Portfolios'(File No. 2-74808) Post-Effective Amendment No. 31.
(k) Joint Trading Account Custody Agreement between The Bank of New
York and Fidelity Advisor Series I on behalf of Fidelity Advisor
Equity Growth Fund, dated May 11, 1995, is incorporated herein by
reference to Exhibit 8(h) of Fidelity Institutional Cash Portfolios'
(File No. 2-74808) Post-Effective Amendment No. 31.
(l) First Amendment to Joint Trading Account Custody Agreement
between The Bank of New York and Fidelity Advisor Series I on behalf
of Fidelity Advisor Equity Growth Fund, dated July 14, 1995, is
incorporated herein by reference to Exhibit 8(i) of Fidelity
Institutional Cash Portfolios' (File No. 2-74808) Post-Effective
Amendment No. 31.
(m) Forms of Custodian Agreement, Appendix B, and Appendix C between
The Chase Manhattan Bank, N.A. and Fidelity Advisor Series I on behalf
of Fidelity Advisor TechnoQuant Growth Fund and Fidelity Advisor
Growth & Income Fund are incorporated herein by reference to Exhibit
8(m) of Post-Effective Amendment No. 43.
(n) Forms of Custodian Agreement, Appendix B, and Appendix C between
Brown Brothers Harriman & Company and Fidelity Advisor Series I on
behalf of Fidelity Advisor Strategic Opportunities Fund and Fidelity
Advisor Growth Opportunities Fund are incorporated herein by reference
to Exhibit 8(n) of Post-Effective Amendment No. 43.
(o) Forms of Fidelity Group Repo Custodian Agreement and Schedule 1
among The Bank of New York, J.P. Morgan Securities, Inc., and Fidelity
Advisor Series I on behalf of Fidelity Advisor TechnoQuant Growth
Fund, Fidelity Advisor Growth & Income Fund, Fidelity Advisor
Strategic Opportunities Fund, and Fidelity Advisor Growth
Opportunities Fund are incorporated herein by reference to Exhibit
8(o) of Post-Effective Amendment No. 43.
(p) Forms of Fidelity Group Repo Custodian Agreement and Schedule 1
among Chemical Bank, Greenwich Capital Markets, Inc., and Fidelity
Advisor Series I on behalf of Fidelity Advisor TechnoQuant Growth
Fund, Fidelity Advisor Growth & Income Fund, Fidelity Advisor
Strategic Opportunities Fund, and Fidelity Advisor Growth
Opportunities Fund are incorporated herein by reference to Exhibit
8(p) of Post-Effective Amendment No. 43.
(q) Forms of Joint Trading Account Custody Agreement and First
Amendment to Joint Trading Account Custody Agreement between The Bank
of New York and Fidelity Advisor Series I on behalf of Fidelity
Advisor TechnoQuant Growth Fund, Fidelity Advisor Growth & Income
Fund, Fidelity Advisor Strategic Opportunities Fund, and Fidelity
Advisor Growth Opportunities Fund are incorporated herein by reference
to Exhibit 8(q) of Post-Effective Amendment No. 43.
(r) Form of Custodian Agreement, Appendix B and Appendix C between
State Street Bank and Trust Company and Fidelity Advisor Series I on
behalf of Fidelity Advisor Small Cap Fund is filed herein as Exhibit
8(r).
(9) Not applicable.
(10) Opinion and Consent of Counsel is filed herein as Exhibit 10.
(11) Consent of PricewaterhouseCoopers LLP is filed herein as
Exhibit 11.
(12) Not applicable.
(13) Not applicable.
(14) (a) Fidelity Individual Retirement Account Custodial Agreement
and Disclosure Statement, as currently in effect, is incorporated
herein by reference to Exhibit 14(a) of Fidelity Union Street Trust's
(File No. 2-50318) Post-Effective Amendment No. 87.
(b) Fidelity Institutional Individual Retirement Account Custodial
Agreement and Disclosure Statement, as currently in effect, is
incorporated herein by reference to Exhibit 14(d) of Fidelity Union
Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
(c) National Financial Services Corporation Individual Retirement
Account Custodial Agreement and Disclosure Statement, as currently in
effect, is incorporated herein by reference to Exhibit 14(h) of
Fidelity Union Street Trust's (File No. 2-50318) Post-Effective
Amendment No. 87.
(d) Fidelity Portfolio Advisory Services Individual Retirement
Account Custodial Agreement and Disclosure Statement, as currently in
effect, is incorporated herein by reference to
Exhibit 14(i) of Fidelity Union Street Trust's (File No. 2-50318)
Post-Effective Amendment No. 87.
(e) Fidelity 403(b)(7) Custodial Account Agreement, as currently in
effect, is incorporated herein by reference to Exhibit 14(e) of
Fidelity Union Street Trust's (File No. 2-50318) Post-Effective
Amendment No. 87.
(f) National Financial Services Corporation Defined Contribution
Retirement Plan and Trust Agreement, as currently in effect, is
incorporated herein by reference to Exhibit 14(k) of Fidelity Union
Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
(g) The CORPORATEplan for Retirement Profit Sharing/401K Plan, as
currently in effect, is incorporated herein by reference to Exhibit
14(l) of Fidelity Union Street Trust's (File No. 2-50318)
Post-Effective Amendment No. 87.
(h) The CORPORATEplan for Retirement Money Purchase Pension Plan, as
currently in effect, is incorporated herein by reference to Exhibit
14(m) of Fidelity Union Street Trust's (File No. 2-50318)
Post-Effective Amendment No. 87.
(i) Fidelity Investments Section 403(b)(7) Individual Custodial
Account Agreement and Disclosure Statement, as currently in effect, is
incorporated herein by reference to Exhibit 14(f) of Fidelity
Commonwealth Trust's (File No. 2-52322) Post-Effective Amendment No.
57.
(j) Plymouth Investments Defined Contribution Retirement Plan and
Trust Agreement, as currently in effect, is incorporated herein by
reference to Exhibit 14(o) of Fidelity Commonwealth Trust's (File No.
2-52322) Post-Effective Amendment No. 57.
(k) The Fidelity Prototype Defined Benefit Pension Plan and Trust
Basic Plan Document and Adoption Agreement, as currently in effect, is
incorporated herein by reference to Exhibit 14(d) of Fidelity
Securities Fund's (File No. 2-93601) Post-Effective Amendment No. 33.
(l) The Institutional Prototype Plan Basic Plan Document,
Standardized Adoption Agreement, and Non-Standardized Adoption
Agreement, as currently in effect, is incorporated herein by reference
to Exhibit 14(o) of Fidelity Securities Fund's (File No. 2-93601)
Post-Effective Amendment No. 33.
(m) The CORPORATEplan for Retirement 100SM Profit Sharing/401(k)
Basic Plan Document, Standardized Adoption Agreement, and
Non-Standardized Adoption Agreement, as currently in effect, is
incorporated herein by reference to Exhibit 14(f) of Fidelity
Securities Fund's (File No. 2-93601) Post-Effective Amendment No. 33.
(n) The Fidelity Investments 401(a) Prototype Plan for Tax-Exempt
Employers Basic Plan Document, Standardized Profit Sharing Plan
Adoption Agreement, Non-Standardized Discretionary Contribution Plan
No. 002 Adoption Agreement, and Non-Standardized Discretionary
Contribution Plan No. 003 Adoption Agreement, as currently in effect,
is incorporated herein by reference to Exhibit 14(g) of Fidelity
Securities Fund's (File No. 2-93601) Post-Effective Amendment No. 33.
(o) Fidelity Investments 403(b) Sample Plan Basic Plan Document and
Adoption Agreement, as currently in effect, is incorporated herein by
reference to Exhibit 14(p) of Fidelity Securities Fund's (File No.
2-93601) Post-Effective Amendment No. 33.
(p) Fidelity Defined Contribution Retirement Plan and Trust
Agreement, as currently in effect, is incorporated herein by reference
to Exhibit 14(c) of Fidelity Securities Fund's (File No. 2-93601)
Post-Effective Amendment No. 33.
(q) Fidelity SIMPLE-IRA Plan Adoption Agreement, Company Profile
Form, and Plan Document, as currently in effect, is incorporated
herein by reference to Exhibit 14(q) of Fidelity Aberdeen Street
Trust's (File No. 33-43529) Post-Effective Amendment No. 19.
(15) (a) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Equity Growth Fund: Class T is incorporated herein by
reference to Exhibit 15(a) of Post-Effective Amendment No. 41.
(b) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Equity Growth Fund (formerly known as Fidelity
Advisor Equity Portfolio Growth): Institutional Class is incorporated
herein by reference to Exhibit 15(b) of Post-Effective Amendment No.
38.
(c) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Mid Cap Fund: Class T (formerly known as Class A) is
incorporated herein by reference to Exhibit 15(c) of Post-Effective
Amendment No. 38.
(d) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Mid Cap Fund: Class B is incorporated herein by
reference to Exhibit 15(d) of Post-Effective Amendment No. 38.
(e) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Mid Cap Fund: Institutional Class is incorporated
herein by reference to Exhibit 15(e) of Post-Effective Amendment No.
38.
(f) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Large Cap Fund: Class T (formerly known as Class A)
is incorporated herein by reference to Exhibit 15(f) of Post-Effective
Amendment No. 38.
(g) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Large Cap Fund: Class B is incorporated herein by
reference to Exhibit 15(g) of Post-Effective Amendment No. 38
(h) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Large Cap Fund: Institutional Class is incorporated
herein by reference to Exhibit 15(h) of Post-Effective Amendment No.
38.
(i) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Equity Growth Fund: Class A is incorporated herein by
reference to Exhibit 15(i) of Post-Effective Amendment No. 34.
(j) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Mid Cap Fund: Class A is incorporated herein by
reference to Exhibit 15(j) of Post-Effective Amendment No. 34.
(k) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Large Cap Fund: Class A is incorporated herein by
reference to Exhibit 15(k) of Post-Effective Amendment No. 34.
(l) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Equity Growth Fund: Class B is incorporated herein by
reference to Exhibit 15(l) of Post-Effective Amendment No. 36.
(m) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Growth & Income Fund: Class A is incorporated herein
by reference to Exhibit 15(m) of Post-Effective Amendment No. 36.
(n) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Growth & Income Fund: Class T is incorporated herein
by reference to Exhibit 15(n) of Post-Effective Amendment No. 36.
(o) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Growth & Income Fund: Class B is incorporated herein
by reference to Exhibit 15(o) of Post-Effective Amendment No. 36.
(p) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Growth & Income Fund: Institutional Class is
incorporated herein by reference to Exhibit 15(p) of Post-Effective
Amendment No. 38.
(q) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor TechnoQuant Growth Fund: Class A is incorporated
herein by reference to Exhibit 15(q) of Post-Effective Amendment No.
36.
(r) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor TechnoQuant Growth Fund: Class T is incorporated
herein by reference to Exhibit 15(r) of Post-Effective Amendment No.
36.
(s) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor TechnoQuant Growth Fund: Class B is incorporated
herein by reference to Exhibit 15(s) of Post-Effective Amendment No.
36.
(t) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor TechnoQuant Growth Fund: Institutional Class is
incorporated herein by reference to Exhibit 15(t) of Post-Effective
Amendment No. 38.
(u) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Equity Growth Fund: Class C is incorporated herein by
reference to Exhibit 15(u) of Post-Effective Amendment No. 41.
(v) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Mid Cap Fund: Class C is incorporated herein by
reference to Exhibit 15(v) of Post-Effective Amendment No. 41.
(w) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Large Cap Fund: Class C is incorporated herein by
reference to Exhibit 15(w) of Post-Effective Amendment No. 41.
(x) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor TechnoQuant Growth Fund: Class C is incorporated
herein by reference to Exhibit 15(x) of Post-Effective Amendment No.
41.
(y) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Growth & Income Fund: Class C is incorporated herein
by reference to Exhibit 15(y) of Post-Effective Amendment No. 41.
(z) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Growth Opportunities Fund: Class A is incorporated
herein by reference to Exhibit 15(z) of Post-Effective Amendment No.
43.
(aa) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Growth Opportunities Fund: Class T is incorporated
herein by reference to Exhibit 15(aa) of Post-Effective Amendment No.
43.
(bb) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Growth Opportunities Fund: Class B is incorporated
herein by reference to Exhibit 15(bb) of Post-Effective Amendment No.
43.
(cc) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Growth Opportunities Fund: Class C is incorporated
herein by reference to Exhibit 15(cc) of Post-Effective Amendment No.
43.
(dd) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Growth Opportunities Fund: Institutional Class is
incorporated herein by reference to Exhibit 15(dd) of Post-Effective
Amendment No. 43.
(ee) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Strategic Opportunities Fund: Class A is incorporated
herein by reference to Exhibit 15(ee) of Post-Effective Amendment No.
43.
(ff) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Strategic Opportunities Fund: Class T is incorporated
herein by reference to Exhibit 15(ff) of Post-Effective Amendment No.
43.
(gg) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Strategic Opportunities Fund: Class B is incorporated
herein by reference to Exhibit 15(gg) of Post-Effective Amendment No.
43.
(hh) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Strategic Opportunities Fund: Institutional Class is
incorporated herein by reference to Exhibit 15(hh) of Post-Effective
Amendment No. 43.
(ii) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Small Cap Fund: Class A is filed herein as Exhibit
15(ii).
(jj) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Small Cap Fund: Class T is filed herein as Exhibit
15(jj).
(kk) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Small Cap Fund: Class B is filed herein as Exhibit
15(kk).
(ll) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Small Cap Fund: Class C is filed herein as Exhibit
15(ll).
(mm) Distribution and Service Plan pursuant to Rule 12b-1 for
Fidelity Advisor Small Cap Fund: Institutional Class is filed herein
as Exhibit 15(mm).
(16) (a) Schedule for computation of cumulative total returns and
average annual returns is incorporated herein by reference to 16(a) of
Post-Effective Amendment No. 29.
(b) Schedule for computation of adjusted net asset value and
moving averages calculations incorporated herein by reference to
Exhibit 16(b) of Post-Effective Amendment No. 29.
(17) Not applicable.
(18) (a) Multiple Class of Shares Plan pursuant to Rule 18f-3,
dated July 16, 1998 on behalf of Fidelity Advisor Equity Growth Fund,
Fidelity Advisor Large Cap Fund, Fidelity Advisory Growth & Income
Fund, Fidelity Advisor TechnoQuant Growth Fund, Fidelity Advisor Mid
Cap Fund, Fidelity Advisor Strategic Opportunities Fund and Fidelity
Advisor Small Cap Fund is filed herein as Exhibit 18(a).
Item 25. Persons Controlled by or under Common Control with Registrant
The Board of Trustees of the Registrant is the same as the board of
other funds advised by FMR, each of which has Fidelity Management &
Research Company as its investment adviser. In addition, the officers
of these funds are substantially identical. Nonetheless, the
Registrant takes the position that it is not under common control with
these other funds since the power residing in the respective boards
and officers arises as the result of an official position with the
respective funds.
Item 26. Number of Holders of Securities
Title of Class: Shares of Beneficial Interest as of July 31, 1998
<TABLE>
<CAPTION>
<S> <C>
NAME OF SERIES NUMBER OF RECORD
HOLDERS
FIDELITY ADVISOR EQUITY GROWTH FUND: CLASS A 3,813
FIDELITY ADVISOR EQUITY GROWTH FUND: CLASS T 123,789
FIDELITY ADVISOR EQUITY GROWTH FUND: CLASS B 15,489
FIDELITY ADVISOR EQUITY GROWTH FUND: CLASS C 1,786
FIDELITY ADVISOR EQUITY GROWTH FUND: INSTITUTIONAL CLASS 4,016
FIDELITY ADVISOR MID CAP FUND: CLASS A 332
FIDELITY ADVISOR MID CAP FUND: CLASS T 22,607
FIDELITY ADVISOR MID CAP FUND: CLASS B 5,979
FIDELITY ADVISOR MID CAP FUND: CLASS C 787
FIDELITY ADVISOR MID CAP FUND: INSTITUTIONAL CLASS 515
FIDELITY ADVISOR LARGE CAP FUND: CLASS A 332
FIDELITY ADVISOR LARGE CAP FUND: CLASS T 2,994
FIDELITY ADVISOR LARGE CAP FUND: CLASS B 2,051
FIDELITY ADVISOR LARGE CAP FUND: CLASS C 156
FIDELITY ADVISOR LARGE CAP FUND: INSTITUTIONAL CLASS 31
FIDELITY ADVISOR GROWTH & INCOME FUND: CLASS A 1,510
FIDELITY ADVISOR GROWTH & INCOME FUND: CLASS T 14,202
FIDELITY ADVISOR GROWTH & INCOME FUND: CLASS B 6,330
FIDELITY ADVISOR GROWTH & INCOME FUND: CLASS C 1,615
FIDELITY ADVISOR GROWTH & INCOME FUND: INSTITUTIONAL CLASS 672
FIDELITY ADVISOR TECHNOQUANT GROWTH FUND: CLASS A 324
FIDELITY ADVISOR TECHNOQUANT GROWTH FUND: CLASS T 1,880
FIDELITY ADVISOR TECHNOQUANT GROWTH FUND: CLASS B 948
FIDELITY ADVISOR TECHNOQUANT GROWTH FUND: CLASS C 60
FIDELITY ADVISOR TECHNOQUANT GROWTH FUND: INSTITUTIONAL CLASS 12
FIDELITY ADVISOR STRATEGIC OPPORTUNITIES FUND: INITIAL CLASS 936
FIDELITY ADVISOR STRATEGIC OPPORTUNITIES FUND CLASS A 567
FIDELITY ADVISOR STRATEGIC OPPORTUNITIES FUND: CLASS T 22,658
FIDELITY ADVISOR STRATEGIC OPPORTUNITIES FUND: CLASS B 8,393
FIDELITY ADVISOR STRATEGIC OPPORTUNITIES FUND: INSTITUTIONAL CLASS 85
FIDELITY ADVISOR GROWTH OPPORTUNITIES FUND: CLASS A 21,055
FIDELITY ADVISOR GROWTH OPPORTUNITIES FUND: CLASS T 532,051
FIDELITY ADVISOR GROWTH OPPORTUNITIES FUND: CLASS B 78,769
FIDELITY ADVISOR GROWTH OPPORTUNITIES FUND: CLASS C 11,424
FIDELITY ADVISOR GROWTH OPPORTUNITIES FUND: INSTITUTIONAL CLASS 3,670
FIDELITY ADVISOR SMALL CAP FUND: CLASS A 0
FIDELITY ADVISOR SMALL CAP FUND: CLASS T 0
FIDELITY ADVISOR SMALL CAP FUND: CLASS B 0
FIDELITY ADVISOR SMALL CAP FUND: CLASS C 0
FIDELITY ADVISOR SMALL CAP FUND: INSTITUTIONAL CLASS 0
</TABLE>
Item 27. Indemnification
Article XI, Section 2 of the Declaration of Trust sets forth the
reasonable and fair means for determining whether indemnification
shall be provided to any past or present Trustee or officer. It states
that the Registrant shall indemnify any present or past Trustee or
officer to the fullest extent permitted by law against liability and
all expenses reasonably incurred by him in connection with any claim,
action, suit, or proceeding in which he is involved by virtue of his
service as a Trustee, an officer, or both. Additionally, amounts paid
or incurred in settlement of such matters are covered by this
indemnification. Indemnification will not be provided in certain
circumstances, however. These include instances of willful
misfeasance, bad faith, gross negligence, and reckless disregard of
the duties involved in the conduct of the particular office involved.
Pursuant to Section 11 of the Distribution Agreement, the Registrant
agrees to indemnify and hold harmless the Distributor and each of its
directors and officers and each person, if any, who controls the
Distributor within the meaning of Section 15 of the 1933 Act against
any loss, liability, claim, damages or expense arising by reason of
any person acquiring any shares, based upon the ground that the
registration statement, Prospectus, Statement of Additional
Information, shareholder reports or other information filed or made
public by the Registrant included a materially misleading statement or
omission. However, the Registrant does not agree to indemnify the
Distributor or hold it harmless to the extent that the statement or
omission was made in reliance upon, and in conformity with,
information furnished to the Registrant by or on behalf of the
Distributor. The Registrant does not agree to indemnify the parties
against any liability to which they would be subject by reason of
willful misfeasance, bad faith, gross negligence, and reckless
disregard of the obligations and duties under the Distribution
Agreement.
Pursuant to the agreement by which Fidelity Service Company, Inc.
("Service") is appointed transfer agent, the Registrant agrees to
indemnify and hold Service 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 the
Service and/or the Registrant as a party and is not based on and does
not result from Service's willful misfeasance, bad faith or negligence
or reckless disregard of duties, and arises out of or in connection
with Service's performance under the Transfer Agency Agreement; or
(2) any claim, demand, action or suit (except to the extent
contributed to by Service's willful misfeasance, bad faith or
negligence or reckless disregard of duties) which results from the
negligence of the Registrant, or from Service'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 Service's acting in reliance upon advice reasonably believed
by Service to have been given by counsel for the Registrant, or as a
result of Service'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 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.
Item 28. 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.
MARTA AMIEVA VICE PRESIDENT 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.
ROBERT GERVIS VICE PRESIDENT OF FMR.
DAVID L. GLANCY VICE PRESIDENT OF FMR AND OF A FUND ADVISED BY FMR.
KEVIN E. GRANT VICE PRESIDENT OF FMR AND OF FUNDS 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 VICE PRESIDENT OF HIGH-INCOME FUNDS ADVISED BY FMR;
VICE PRESIDENT OF 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.
CURT HOLLINGSWORTH VICE PRESIDENT OF FMR AND OF FUNDS ADVISED BY FMR.
ABIGAIL P. JOHNSON SENIOR VICE PRESIDENT OF FMR AND VICE PRESIDENT OF
FUNDS ADVISED BY FMR; DIRECTOR OF FMR CORP.;
ASSOCIATE DIRECTOR AND SENIOR VICE PRESIDENT OF EQUITY
FUNDS ADVISED BY FMR.
DAVID B. JONES VICE PRESIDENT OF FMR.
STEVEN KAYE VICE PRESIDENT OF FMR AND OF A FUND ADVISED BY FMR.
FRANCIS V. KNOX VICE PRESIDENT OF FMR; COMPLIANCE OFFICER OF FMR
U.K.
ROBERT A. LAWRENCE SENIOR VICE PRESIDENT OF FMR AND VICE PRESIDENT OF
FIDELITY REAL ESTATE HIGH INCOME AND FIDELITY REAL
ESTATE HIGH INCOME II FUNDS ADVISED BY FMR;
ASSOCIATE DIRECTOR AND SENIOR VICE PRESIDENT OF EQUITY
FUNDS ADVISED BY FMR; PREVIOUSLY, VICE PRESIDENT OF
HIGH INCOME FUNDS ADVISED BY FMR.
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.
DIANE M. MCLAUGHLIN VICE PRESIDENT OF FMR.
NEAL P. MILLER VICE PRESIDENT OF FMR.
DAVID L. MURPHY VICE PRESIDENT OF FMR AND OF FUNDS ADVISED BY FMR.
SCOTT A. ORR VICE PRESIDENT OF FMR AND OF FUNDS ADVISED BY FMR.
JACQUES PEROLD VICE PRESIDENT OF FMR.
ANNE PUNZAK VICE PRESIDENT OF FMR.
ALAN RADLO VICE PRESIDENT OF FMR.
KEVIN A. RICHARDSON 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.
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.
CYNTHIA L. STRAUSS VICE PRESIDENT OF FMR.
THOMAS SWEENEY VICE PRESIDENT OF FMR AND OF A FUND ADVISED BY 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>
(2) FIDELITY MANAGEMENT & RESEARCH (U.K.) INC. (FMR U.K.)
25 Lovat Lane, London, EC3R 8LL, England
FMR U.K. provides investment advisory services to Fidelity Management
& Research Company and Fidelity Management Trust Company. The
directors and officers of the Sub-Adviser have held the following
positions of a substantial nature during the past two fiscal years.
EDWARD C. JOHNSON 3D CHAIRMAN OF THE BOARD AND DIRECTOR OF FMR U.K.,
FMR, FMR CORP., FIMM, AND FMR FAR EAST; PRESIDENT
AND CHIEF EXECUTIVE OFFICER OF FMR CORP.; 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.
BRIAN CLANCY TREASURER OF FMR U.K., FMR FAR EAST, FMR, AND
FIMM AND VICE PRESIDENT OF FMR.
STEPHEN G. MANNING ASSISTANT TREASURER OF FMR U.K., FMR, FMR FAR EAST,
AND FIMM; VICE PRESIDENT AND TREASURER OF FMR
CORP.; TREASURER OF STRATEGIC ADVISERS, INC.
FRANCIS V. KNOX COMPLIANCE OFFICER OF FMR U.K.; VICE PRESIDENT OF
FMR.
JAY FREEDMAN 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.
SARAH H. ZENOBLE SENIOR VICE PRESIDENT AND DIRECTOR OF OPERATIONS AND
COMPLIANCE.
(3) FIDELITY MANAGEMENT & RESEARCH (Far East) INC. (FMR Far East)
Shiroyama JT Mori Bldg., 4-3-1 Toranomon Minato-ku, Tokyo 105,
Japan
FMR Far East provides investment advisory services to Fidelity
Management & Research Company and Fidelity Management Trust Company.
The directors and officers of the Sub-Adviser have held the following
positions of a substantial nature during the past two fiscal years.
EDWARD C. JOHNSON 3D CHAIRMAN OF THE BOARD AND DIRECTOR OF FMR FAR
EAST, FMR, FMR CORP., FIMM, 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.
ROBERT H. AULD SENIOR VICE PRESIDENT OF FMR FAR EAST.
BRIAN CLANCY TREASURER OF FMR FAR EAST, FMR U.K., FMR,
AND FIMM AND VICE PRESIDENT OF FMR.
JAY FREEDMAN CLERK OF FMR FAR EAST, FMR U.K., FMR CORP.
AND STRATEGIC ADVISERS, INC.; ASSISTANT CLERK OF
FMR; SECRETARY OF FIMM; ASSOCIATE GENERAL
COUNSEL FMR CORP.
STEPHEN G. MANNING ASSISTANT TREASURER OF FMR FAR EAST, FMR,
FMR U.K., AND FIMM; VICE PRESIDENT AND
TREASURER OF FMR CORP.; TREASURER OF STRATEGIC
ADVISERS, INC.
BILLY WILDER VICE PRESIDENT OF FMR FAR EAST; PRESIDENT AND
REPRESENTATIVE DIRECTOR OF FIDELITY INVESTMENTS
JAPAN LIMITED.
Item 29. 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 30. Location of Accounts and Records
All accounts, books, and other documents required to be maintained by
Section 31a of the 1940 Act and the Rules promulgated thereunder are
maintained by Fidelity Management & Research Company or Fidelity
Service Company, Inc., 82 Devonshire Street, Boston, MA 02109, or the
funds' respective custodian The Chase Manhattan Bank, 1 Chase
Manhattan Plaza, New York, N.Y., Brown Brothers Harriman & Co., 40
Water Street, Boston, MA or State Street Bank and Trust Company, 1776
Heritage Drive, North Quincy, MA.
Item 31. Management Services
Not applicable.
Item 32. Undertakings
(a) The Registrant undertakes for Fidelity Advisor Small Cap Fund: (1)
to call a meeting of shareholders for the purpose of voting upon the
questions of removal of a trustee or trustees, when requested to do so
by record holders of not less than 10% of its outstanding shares; and
(2) to assist in communications with other shareholders pursuant to
Section 16(c)(1) and (2), whenever shareholders meeting the
qualifications set forth in Section 16(c) seek the opportunity to
communicate with other shareholders with a view toward requesting a
meeting.
(b) The Registrant, on behalf of Fidelity Advisor Small Cap Fund,
provided the information required by Item 5A is contained in the
annual report, undertakes to furnish to each person to whom a
prospectus has been delivered, upon their request and without charge,
a copy of the Registrant's latest annual report to shareholders.
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. 45 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 31st day of August 1998.
Fidelity Advisor Series I
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 AUGUST 31, 1998
EDWARD C. JOHNSON 3D (PRINCIPAL EXECUTIVE OFFICER)
/S/RICHARD A. SILVER TREASURER AUGUST 31, 1998
RICHARD A. SILVER
/S/ROBERT C. POZEN TRUSTEE AUGUST 31, 1998
ROBERT C. POZEN
/S/RALPH F. COX * TRUSTEE AUGUST 31, 1998
RALPH F. COX
/S/PHYLLIS BURKE DAVIS * TRUSTEE AUGUST 31, 1998
PHYLLIS BURKE DAVIS
/S/ROBERT M. GATES ** TRUSTEE AUGUST 31, 1998
ROBERT M. GATES
/S/E. BRADLEY JONES * TRUSTEE AUGUST 31, 1998
E. BRADLEY JONES
/S/DONALD J. KIRK * TRUSTEE AUGUST 31, 1998
DONALD J. KIRK
/S/PETER S. LYNCH * TRUSTEE AUGUST 31, 1998
PETER S. LYNCH
/S/MARVIN L. MANN * TRUSTEE AUGUST 31, 1998
MARVIN L. MANN
/S/WILLIAM O. MCCOY * TRUSTEE AUGUST 31, 1998
WILLIAM O. MCCOY
/S/GERALD C. MCDONOUGH * TRUSTEE AUGUST 31, 1998
GERALD C. MCDONOUGH
/S/THOMAS R. WILLIAMS * TRUSTEE AUGUST 31, 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
MANAGEMENT CONTRACT
between
FIDELITY ADVISOR SERIES I:
FIDELITY ADVISOR SMALL CAP FUND
and
FIDELITY MANAGEMENT & RESEARCH COMPANY
AGREEMENT made this 16th day of July 1998, by and between Fidelity
Advisor Series I, a Massachusetts business trust which may issue one
or more series of shares of beneficial interest (hereinafter called
the "Fund"), on behalf of Fidelity Advisor Small Cap Fund (hereinafter
called the "Portfolio"), and Fidelity Management & Research Company, a
Massachusetts corporation (hereinafter called the "Adviser") as set
forth in its entirety below.
1. (a) Investment Advisory Services. The Adviser undertakes to act
as investment adviser of the Portfolio and shall, subject to the
supervision of the Fund's Board of Trustees, direct the investments of
the Portfolio in accordance with the investment objective, policies
and limitations as provided in the Portfolio's Prospectus or other
governing instruments, as amended from time to time, the Investment
Company Act of 1940 and rules thereunder, as amended from time to time
(the "1940 Act"), and such other limitations as the Portfolio may
impose by notice in writing to the Adviser. The Adviser shall also
furnish for the use of the Portfolio office space and all necessary
office facilities, equipment and personnel for servicing the
investments of the Portfolio; and shall pay the salaries and fees of
all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all
personnel of the Fund or the Adviser performing services relating to
research, statistical and investment activities. The Adviser is
authorized, in its discretion and without prior consultation with the
Portfolio, to buy, sell, lend and otherwise trade in any stocks, bonds
and other securities and investment instruments on behalf of the
Portfolio. The investment policies and all other actions of the
Portfolio are and shall at all times be subject to the control and
direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for
the performance by its affiliates of) the management and
administrative services necessary for the operation of the Fund. The
Adviser shall, subject to the supervision of the Board of Trustees,
perform various services for the Portfolio, including but not limited
to: (i) providing the Portfolio with office space, equipment and
facilities (which may be its own) for maintaining its organization;
(ii) on behalf of the Portfolio, supervising relations with, and
monitoring the performance of, custodians, depositories, transfer and
pricing agents, accountants, attorneys, underwriters, brokers and
dealers, insurers and other persons in any capacity deemed to be
necessary or desirable; (iii) preparing all general shareholder
communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered,
maintaining the registration and qualification of the Portfolio's
shares under federal and state law; and (vii) investigating the
development of and developing and implementing, if appropriate,
management and shareholder services designed to enhance the value or
convenience of the Portfolio as an investment vehicle.
The Adviser shall also furnish such reports, evaluations, information
or analyses to the Fund as the Fund's Board of Trustees may request
from time to time or as the Adviser may deem to be desirable. The
Adviser shall make recommendations to the Fund's Board of Trustees
with respect to Fund policies, and shall carry out such policies as
are adopted by the Trustees. The Adviser shall, subject to review by
the Board of Trustees, furnish such other services as the Adviser
shall from time to time determine to be necessary or useful to perform
its obligations under this Contract.
(c) The Adviser shall place all orders for the purchase and sale of
portfolio securities for the Portfolio's account with brokers or
dealers selected by the Adviser, which may include brokers or dealers
affiliated with the Adviser. The Adviser shall use its best efforts
to seek to execute portfolio transactions at prices which are
advantageous to the Portfolio and at commission rates which are
reasonable in relation to the benefits received. In selecting brokers
or dealers qualified to execute a particular transaction, brokers or
dealers may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Portfolio and/or the other
accounts over which the Adviser or its affiliates exercise investment
discretion. The Adviser is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Adviser determines in
good faith that such amount of commission is reasonable in relation to
the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Adviser and its affiliates have with respect to accounts over which
they exercise investment discretion. The Trustees of the Fund shall
periodically review the commissions paid by the Portfolio to determine
if the commissions paid over representative periods of time were
reasonable in relation to the benefits to the Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor.
The Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of
the Fund are or may be or become interested in the Adviser as
directors, officers or otherwise and that directors, officers and
stockholders of the Adviser are or may be or become similarly
interested in the Fund, and that the Adviser may be or become
interested in the Fund as a shareholder or otherwise.
3. The Adviser will be compensated on the following basis for the
services and facilities to be furnished hereunder. The Adviser shall
receive a monthly management fee, payable monthly as soon as
practicable after the last day of each month, composed of a Group Fee
and an Individual Fund Fee.
(a) Group Fee Rate. The Group Fee Rate shall be based upon the
monthly average of the net assets of the registered investment
companies having Advisory and Service or Management Contracts with the
Adviser (computed in the manner set forth in the fund's Declaration of
Trust or other organizational document) determined as of the close of
business on each business day throughout the month. The Group Fee
Rate shall be determined on a cumulative basis pursuant to the
following schedule:
Average Net Assets Annualized Fee Rate (for each level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over - 534 .2500
(b) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be
.45%.
The sum of the Group Fee Rate, calculated as described above to the
nearest millionth, and the Individual Fund Fee Rate shall constitute
the Annual Management Fee Rate. One-twelfth of the Annual Management
Fee Rate shall be applied to the average of the net assets of the
Portfolio (computed in the manner set forth in the Fund's Declaration
of Trust or other organizational document) determined as of the close
of business on each business day throughout the month.
(c) In case of termination of this Contract during any month, the
fee for that month shall be reduced proportionately on the basis of
the number of business days during which it is in effect, and the fee
computed upon the average net assets for the business days it is so in
effect for that month.
4. It is understood that the Portfolio will pay all its expenses,
which expenses payable by the Portfolio shall include, without
limitation, (i) interest and taxes; (ii) brokerage commissions and
other costs in connection with the purchase or sale of securities and
other investment instruments; (iii) fees and expenses of the Fund's
Trustees other than those who are "interested persons" of the Fund or
the Adviser; (iv) legal and audit expenses; (v) custodian, registrar
and transfer agent fees and expenses; (vi) fees and expenses related
to the registration and qualification of the Fund and the Portfolio's
shares for distribution under state and federal securities laws; (vii)
expenses of printing and mailing reports and notices and proxy
material to shareholders of the Portfolio; (viii) all other expenses
incidental to holding meetings of the Portfolio's shareholders,
including proxy solicitations therefor; (ix) a pro rata share, based
on relative net assets of the Portfolio and other registered
investment companies having Advisory and Service or Management
Contracts with the Adviser, of 50% of insurance premiums for fidelity
and other coverage; (x) its proportionate share of association
membership dues; (xi) expenses of typesetting for printing
Prospectuses and Statements of Additional Information and supplements
thereto; (xii) expenses of printing and mailing Prospectuses and
Statements of Additional Information and supplements thereto sent to
existing shareholders; and (xiii) such non-recurring or extraordinary
expenses as may arise, including those relating to actions, suits or
proceedings to which the Portfolio is a party and the legal obligation
which the Portfolio may have to indemnify the Fund's Trustees and
officers with respect thereto.
5. The services of the Adviser to the Portfolio are not to be deemed
exclusive, the Adviser being free to render services to others and
engage in other activities, provided, however, that such other
services and activities do not, during the term of this Contract,
interfere, in a material manner, with the Adviser's ability to meet
all of its obligations with respect to rendering services to the
Portfolio hereunder. In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Adviser, the Adviser shall not be subject
to liability to the Portfolio or to any shareholder of the Portfolio
for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the
purchase, holding or sale of any security or other investment
instrument.
6. (a) Subject to prior termination as provided in sub-paragraph (d)
of this paragraph 6, this Contract shall continue in force until July
31, 1999 and indefinitely thereafter, but only so long as the
continuance after such date shall be specifically approved at least
annually by vote of the Trustees of the Fund or by vote of a majority
of the outstanding voting securities of the Portfolio.
(b) This Contract may be modified by mutual consent subject to the
provisions of Section 15 of the 1940 Act, as modified by or
interpreted by any applicable order or orders of the Securities and
Exchange Commission (the "Commission") or any rules or regulations
adopted by, or interpretative releases of, the Commission.
(c) In addition to the requirements of sub-paragraphs (a) and (b) of
this paragraph 6, the terms of any continuance or modification of this
Contract must have been approved by the vote of a majority of those
Trustees of the Fund who are not parties to the Contract or interested
persons of any such party, cast in person at a meeting called for the
purpose of voting on such approval.
(d) Either party hereto may, at any time on sixty (60) days' prior
written notice to the other, terminate this Contract, without payment
of any penalty, by action of its Trustees or Board of Directors, as
the case may be, or with respect to the Portfolio by vote of a
majority of the outstanding voting securities of the Portfolio. This
Contract shall terminate automatically in the event of its assignment.
7. The Adviser is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Fund's Declaration of Trust
or other organizational document and agrees that the obligations
assumed by the Fund pursuant to this Contract shall be limited in all
cases to the Portfolio and its assets, and the Adviser shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio or any other Portfolios of the Fund. In
addition, the Adviser shall not seek satisfaction of any such
obligations from the Trustees or any individual Trustee. The Adviser
understands that the rights and obligations of any Portfolio under the
Declaration of Trust or other organizational document are separate and
distinct from those of any and all other Portfolios.
8. This Agreement shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Massachusetts, without giving
effect to the choice of laws provisions thereof.
The terms "vote of a majority of the outstanding voting securities,"
"assignment," and "interested persons," when used herein, shall have
the respective meanings specified in the 1940 Act, as now in effect or
as hereafter amended, and subject to such orders as may be granted by
the Commission.
IN WITNESS WHEREOF the parties have caused this instrument to be
signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
FIDELITY ADVISOR SERIES I
on behalf of Fidelity Advisor Small Cap Fund
By: /s/ Robert C. Pozen
Senior Vice President
FIDELITY MANAGEMENT & RESEARCH COMPANY
By: /s/ Robert C. Pozen President
SUB-ADVISORY AGREEMENT
BETWEEN
FIDELITY MANAGEMENT & RESEARCH COMPANY
AND
FIDELITY MANAGEMENT & RESEARCH (U.K.) INC.
AND
FIDELITY ADVISOR SERIES I ON BEHALF OF FIDELITY ADVISOR SMALL CAP FUND
AGREEMENT made this 16th day of July, 1998, by and between Fidelity
Management & Research Company, a Massachusetts corporation with
principal offices at 82 Devonshire Street, Boston, Massachusetts
(hereinafter called the "Advisor"); Fidelity Management & Research
(U.K.) Inc. (hereinafter called the "Sub-Advisor"); and Fidelity
Advisor Series I, a Massachusetts business trust which may issue one
or more series of shares of beneficial interest (hereinafter called
the "Trust") on behalf of Fidelity Advisor Small Cap Fund (hereinafter
called the "Portfolio").
WHEREAS the Trust and the Advisor have entered into a Management
Contract on behalf of the Portfolio, pursuant to which the Advisor is
to act as investment manager of the Portfolio; and
WHEREAS the Sub-Advisor and its subsidiaries and other affiliated
persons have personnel in various locations throughout the world and
have been formed in part for the purpose of researching and compiling
information and recommendations with respect to the economies of
various countries, and securities of issuers located in such
countries, and providing investment advisory services in connection
therewith;
NOW, THEREFORE, in consideration of the premises and the mutual
promises hereinafter set forth, the Trust, the Advisor and the
Sub-Advisor agree as follows:
1. Duties: The Advisor may, in its discretion, appoint the
Sub-Advisor to perform one or more of the following services with
respect to all or a portion of the investments of the Portfolio. The
services and the portion of the investments of the Portfolio to be
advised or managed by the Sub-Advisor shall be as agreed upon from
time to time by the Advisor and the Sub-Advisor. The Sub-Advisor shall
pay the salaries and fees of all personnel of the Sub-Advisor
performing services for the Portfolio relating to research,
statistical and investment activities.
(a) INVESTMENT ADVICE: If and to the extent requested by the
Advisor, the Sub-Advisor shall provide investment advice to the
Portfolio and the Advisor with respect to all or a portion of the
investments of the Portfolio, and in connection with such advice shall
furnish the Portfolio and the Advisor such factual information,
research reports and investment recommendations as the Advisor may
reasonably require. Such information may include written and oral
reports and analyses.
(b) INVESTMENT MANAGEMENT: If and to the extent requested by the
Advisor, the Sub-Advisor shall, subject to the supervision of the
Advisor, manage all or a portion of the investments of the Portfolio
in accordance with the investment objective, policies and limitations
provided in the Portfolio's Prospectus or other governing instruments,
as amended from time to time, the Investment Company Act of 1940 (the
"1940 Act") and rules thereunder, as amended from time to time, and
such other limitations as the Trust or Advisor may impose with respect
to the Portfolio by notice to the Sub-Advisor. With respect to the
portion of the investments of the Portfolio under its management, the
Sub-Advisor is authorized to make investment decisions on behalf of
the Portfolio with regard to any stock, bond, other security or
investment instrument, and to place orders for the purchase and sale
of such securities through such broker-dealers as the Sub-Advisor may
select. The Sub-Advisor may also be authorized, but only to the
extent such duties are delegated in writing by the Advisor, to provide
additional investment management services to the Portfolio, including
but not limited to services such as managing foreign currency
investments, purchasing and selling or writing futures and options
contracts, borrowing money or lending securities on behalf of the
Portfolio. All investment management and any other activities of the
Sub-Advisor shall at all times be subject to the control and direction
of the Advisor and the Trust's Board of Trustees.
(c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or
all of the services contemplated by this Agreement directly or through
such of its subsidiaries or other affiliated persons as the
Sub-Advisor shall determine; provided, however, that performance of
such services through such subsidiaries or other affiliated persons
shall have been approved by the Trust to the extent required pursuant
to the 1940 Act and rules thereunder.
2. Information to be Provided to the Trust and the Advisor: The
Sub-Advisor shall furnish such reports, evaluations, information or
analyses to the Trust and the Advisor as the Trust's Board of Trustees
or the Advisor may reasonably request from time to time, or as the
Sub-Advisor may deem to be desirable.
3. Brokerage: In connection with the services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Sub-Advisor
shall place all orders for the purchase and sale of portfolio
securities for the Portfolio's account with brokers or dealers
selected by the Sub-Advisor, which may include brokers or dealers
affiliated with the Advisor or Sub-Advisor. The Sub-Advisor shall use
its best efforts to seek to execute portfolio transactions at prices
which are advantageous to the Portfolio and at commission rates which
are reasonable in relation to the benefits received. In selecting
brokers or dealers qualified to execute a particular transaction,
brokers or dealers may be selected who also provide brokerage and
research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of l934) to the Portfolio and/or to the other
accounts over which the Sub-Advisor or Advisor exercise investment
discretion. The Sub-Advisor is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Sub-Advisor determines
in good faith that such amount of commission is reasonable in relation
to the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Sub-Advisor has with respect to accounts over which it exercises
investment discretion. The Trustees of the Trust shall periodically
review the commissions paid by the Portfolio to determine if the
commissions paid over representative periods of time were reasonable
in relation to the benefits to the Portfolio.
4. Compensation: The Advisor shall compensate the Sub-Advisor on
the following basis for the services to be furnished hereunder.
(a) INVESTMENT ADVISORY FEE: For services provided under
subparagraph (a) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory
Fee shall be equal to 110% of the Sub-Advisor's costs incurred in
connection with rendering the services referred to in subparagraph (a)
of paragraph 1 of this Agreement. The Sub-Advisory Fee shall not be
reduced to reflect expense reimbursements or fee waivers by the
Advisor, if any, in effect from time to time.
(b) INVESTMENT MANAGEMENT FEE: For services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Investment Management Fee. The
Investment Management Fee shall be equal to: (i) 50% of the monthly
management fee rate (including performance adjustments, if any) that
the Portfolio is obligated to pay the Advisor under its Management
Contract with the Advisor, multiplied by: (ii) the fraction equal to
the net assets of the Portfolio as to which the Sub-Advisor shall have
provided investment management services divided by the net assets of
the Portfolio for that month. If in any fiscal year the aggregate
expenses of the Portfolio exceed any applicable expense limitation
imposed by any state or federal securities laws or regulations, and
the Advisor waives all or a portion of its management fee or
reimburses the Portfolio for expenses to the extent required to
satisfy such limitation, the Investment Management Fee paid to the
Sub-Advisor will be reduced by 50% of the amount of such waivers or
reimbursements multiplied by the fraction determined in (ii). If the
Sub-Advisor reduces its fees to reflect such waivers or reimbursements
and the Advisor subsequently recovers all or any portion of such
waivers or reimbursements, then the Sub-Advisor shall be entitled to
receive from the Advisor a proportionate share of the amount
recovered. To the extent that waivers and reimbursements by the
Advisor required by such limitations are in excess of the Advisor's
management fee, the Investment Management Fee paid to the Sub-Advisor
will be reduced to zero for that month, but in no event shall the
Sub-Advisor be required to reimburse the Advisor for all or a portion
of such excess reimbursements.
(c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have
provided both investment advisory services under subparagraph (a) and
investment management services under subparagraph (b) of paragraph (1)
for the same portion of the investments of the Portfolio for the same
period, the fees paid to the Sub-Advisor with respect to such
investments shall be calculated exclusively under subparagraph (b) of
this paragraph 4.
5. Expenses: It is understood that the Portfolio will pay all of its
expenses other than those expressly stated to be payable by the
Sub-Advisor hereunder or by the Advisor under the Management Contract
with the Portfolio, which expenses payable by the Portfolio shall
include, without limitation, (i) interest and taxes; (ii) brokerage
commissions and other costs in connection with the purchase or sale of
securities and other investment instruments; (iii) fees and expenses
of the Trust's Trustees other than those who are "interested persons"
of the Trust, the Sub-Advisor or the Advisor; (iv) legal and audit
expenses; (v) custodian, registrar and transfer agent fees and
expenses; (vi) fees and expenses related to the registration and
qualification of the Trust and the Portfolio's shares for distribution
under state and federal securities laws; (vii) expenses of printing
and mailing reports and notices and proxy material to shareholders of
the Portfolio; (viii) all other expenses incidental to holding
meetings of the Portfolio's shareholders, including proxy
solicitations therefore; (ix) a pro rata share, based on relative net
assets of the Portfolio and other registered investment companies
having Advisory and Service or Management Contracts with the Advisor,
of 50% of insurance premiums for fidelity and other coverage; (x) its
proportionate share of association membership dues; (xi) expenses of
typesetting for printing Prospectuses and Statements of Additional
Information and supplements thereto; (xii) expenses of printing and
mailing Prospectuses and Statements of Additional Information and
supplements thereto sent to existing shareholders; and (xiii) such
non-recurring or extraordinary expenses as may arise, including those
relating to actions, suits or proceedings to which the Portfolio is a
party and the legal obligation which the Portfolio may have to
indemnify the Trust's Trustees and officers with respect thereto.
6. Interested Persons: It is understood that Trustees, officers,
and shareholders of the Trust are or may be or become interested in
the Advisor or the Sub-Advisor as directors, officers or otherwise and
that directors, officers and stockholders of the Advisor or the
Sub-Advisor are or may be or become similarly interested in the Trust,
and that the Advisor or the Sub-Advisor may be or become interested in
the Trust as a shareholder or otherwise.
7. Services to Other Companies or Accounts: The services of the
Sub-Advisor to the Advisor are not to be deemed to be exclusive, the
Sub-Advisor being free to render services to others and engage in
other activities, provided, however, that such other services and
activities do not, during the term of this Agreement, interfere, in a
material manner, with the Sub-Advisor's ability to meet all of its
obligations hereunder. The Sub-Advisor shall for all purposes be an
independent contractor and not an agent or employee of the Advisor or
the Trust.
8. Standard of Care: In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be
subject to liability to the Advisor, the Trust or to any shareholder
of the Portfolio for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that
may be sustained in the purchase, holding or sale of any security.
9. Duration and Termination of Agreement; Amendments:
(a) Subject to prior termination as provided in subparagraph (d) of
this paragraph 9, this Agreement shall continue in force until July
31, 1999 and indefinitely thereafter, but only so long as the
continuance after such period shall be specifically approved at least
annually by vote of the Trust's Board of Trustees or by vote of a
majority of the outstanding voting securities of the Portfolio.
(b) This Agreement may be modified by mutual consent of the Advisor,
the Sub-Advisor and the Portfolio subject to the provisions of Section
15 of the 1940 Act, as modified by or interpreted by any applicable
order or orders of the Securities and Exchange Commission (the
"Commission") or any rules or regulations adopted by, or
interpretative releases of, the Commission.
(c) In addition to the requirements of subparagraphs (a) and (b) of
this paragraph 9, the terms of any continuance or modification of this
Agreement must have been approved by the vote of a majority of those
Trustees of the Trust who are not parties to this Agreement or
interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval.
(d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any
time on sixty (60) days' prior written notice to the other parties,
terminate this Agreement, without payment of any penalty, by action of
its Board of Trustees or Directors, or with respect to the Portfolio
by vote of a majority of its outstanding voting securities. This
Agreement shall terminate automatically in the event of its
assignment.
10. Limitation of Liability: The Sub-Advisor is hereby expressly
put on notice of the limitation of shareholder liability as set forth
in the Declaration of Trust or other organizational document of the
Trust and agrees that any obligations of the Trust or the Portfolio
arising in connection with this Agreement shall be limited in all
cases to the Portfolio and its assets, and the Sub-Advisor shall not
seek satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio. Nor shall the Sub-Advisor seek
satisfaction of any such obligation from the Trustees or any
individual Trustee.
11. Governing Law: This Agreement shall be governed by, and
construed in accordance with, the laws of the Commonwealth of
Massachusetts, without giving effect to the choice of laws provisions
thereof.
The terms "registered investment company," "vote of a majority of the
outstanding voting securities," "assignment," and "interested
persons," when used herein, shall have the respective meanings
specified in the 1940 Act as now in effect or as hereafter amended.
IN WITNESS WHEREOF the parties hereto have caused this instrument to
be signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
FIDELITY MANAGEMENT & RESEARCH (U.K.) INC.
By: /s/ Brian A. Clancy
Treasurer
FIDELITY MANAGEMENT & RESEARCH COMPANY
By: /s/ Robert C. Pozen
President
FIDELITY ADVISOR SERIES I
on behalf of Fidelity Advisor Small Cap Fund
By: /s/ Robert C. Pozen
Senior Vice President
SUB-ADVISORY AGREEMENT
BETWEEN
FIDELITY MANAGEMENT & RESEARCH COMPANY
AND
FIDELITY MANAGEMENT & RESEARCH (FAR EAST) INC.
AND
FIDELITY ADVISOR SERIES I ON BEHALF OF FIDELITY ADVISOR SMALL CAP FUND
AGREEMENT made this 16th day of July, 1998, by and between Fidelity
Management & Research Company, a Massachusetts corporation with
principal offices at 82 Devonshire Street, Boston, Massachusetts
(hereinafter called the "Advisor"); Fidelity Management & Research
(Far East) Inc. (hereinafter called the "Sub-Advisor"); and Fidelity
Advisor Series I, a Massachusetts business trust which may issue one
or more series of shares of beneficial interest (hereinafter called
the "Trust") on behalf of Fidelity Advisor Small Cap Fund (hereinafter
called the "Portfolio").
WHEREAS the Trust and the Advisor have entered into a Management
Contract on behalf of the Portfolio, pursuant to which the Advisor is
to act as investment manager of the Portfolio; and
WHEREAS the Sub-Advisor and its subsidiaries and other affiliated
persons have personnel in various locations throughout the world and
have been formed in part for the purpose of researching and compiling
information and recommendations with respect to the economies of
various countries, and securities of issuers located in such
countries, and providing investment advisory services in connection
therewith;
NOW, THEREFORE, in consideration of the premises and the mutual
promises hereinafter set forth, the Trust, the Advisor and the
Sub-Advisor agree as follows:
1. Duties: The Advisor may, in its discretion, appoint the
Sub-Advisor to perform one or more of the following services with
respect to all or a portion of the investments of the Portfolio. The
services and the portion of the investments of the Portfolio to be
advised or managed by the Sub-Advisor shall be as agreed upon from
time to time by the Advisor and the Sub-Advisor. The Sub-Advisor shall
pay the salaries and fees of all personnel of the Sub-Advisor
performing services for the Portfolio relating to research,
statistical and investment activities.
(a) INVESTMENT ADVICE: If and to the extent requested by the
Advisor, the Sub-Advisor shall provide investment advice to the
Portfolio and the Advisor with respect to all or a portion of the
investments of the Portfolio, and in connection with such advice shall
furnish the Portfolio and the Advisor such factual information,
research reports and investment recommendations as the Advisor may
reasonably require. Such information may include written and oral
reports and analyses.
(b) INVESTMENT MANAGEMENT: If and to the extent requested by the
Advisor, the Sub-Advisor shall, subject to the supervision of the
Advisor, manage all or a portion of the investments of the Portfolio
in accordance with the investment objective, policies and limitations
provided in the Portfolio's Prospectus or other governing instruments,
as amended from time to time, the Investment Company Act of 1940 (the
"1940 Act") and rules thereunder, as amended from time to time, and
such other limitations as the Trust or Advisor may impose with respect
to the Portfolio by notice to the Sub-Advisor. With respect to the
portion of the investments of the Portfolio under its management, the
Sub-Advisor is authorized to make investment decisions on behalf of
the Portfolio with regard to any stock, bond, other security or
investment instrument, and to place orders for the purchase and sale
of such securities through such broker-dealers as the Sub-Advisor may
select. The Sub-Advisor may also be authorized, but only to the
extent such duties are delegated in writing by the Advisor, to provide
additional investment management services to the Portfolio, including
but not limited to services such as managing foreign currency
investments, purchasing and selling or writing futures and options
contracts, borrowing money, or lending securities on behalf of the
Portfolio. All investment management and any other activities of the
Sub-Advisor shall at all times be subject to the control and direction
of the Advisor and the Trust's Board of Trustees.
(c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or
all of the services contemplated by this Agreement directly or through
such of its subsidiaries or other affiliated persons as the
Sub-Advisor shall determine; provided, however, that performance of
such services through such subsidiaries or other affiliated persons
shall have been approved by the Trust to the extent required pursuant
to the 1940 Act and rules thereunder.
2. Information to be Provided to the Trust and the Advisor: The
Sub-Advisor shall furnish such reports, evaluations, information or
analyses to the Trust and the Advisor as the Trust's Board of Trustees
or the Advisor may reasonably request from time to time, or as the
Sub-Advisor may deem to be desirable.
3. Brokerage: In connection with the services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Sub-Advisor
shall place all orders for the purchase and sale of portfolio
securities for the Portfolio's account with brokers or dealers
selected by the Sub-Advisor, which may include brokers or dealers
affiliated with the Advisor or Sub-Advisor. The Sub-Advisor shall use
its best efforts to seek to execute portfolio transactions at prices
which are advantageous to the Portfolio and at commission rates which
are reasonable in relation to the benefits received. In selecting
brokers or dealers qualified to execute a particular transaction,
brokers or dealers may be selected who also provide brokerage and
research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of l934) to the Portfolio and/or to the other
accounts over which the Sub-Advisor or Advisor exercise investment
discretion. The Sub-Advisor is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess
of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Sub-Advisor determines
in good faith that such amount of commission is reasonable in relation
to the value of the brokerage and research services provided by such
broker or dealer. This determination may be viewed in terms of either
that particular transaction or the overall responsibilities which the
Sub-Advisor has with respect to accounts over which it exercises
investment discretion. The Trustees of the Trust shall periodically
review the commissions paid by the Portfolio to determine if the
commissions paid over representative periods of time were reasonable
in relation to the benefits to the Portfolio.
4. Compensation: The Advisor shall compensate the Sub-Advisor on
the following basis for the services to be furnished hereunder.
(a) INVESTMENT ADVISORY FEE: For services provided under
subparagraph (a) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory
Fee shall be equal to 105% of the Sub-Advisor's costs incurred in
connection with rendering the services referred to in subparagraph (a)
of paragraph 1 of this Agreement. The Sub-Advisory Fee shall not be
reduced to reflect expense reimbursements or fee waivers by the
Advisor, if any, in effect from time to time.
(b) INVESTMENT MANAGEMENT FEE: For services provided under
subparagraph (b) of paragraph 1 of this Agreement, the Advisor agrees
to pay the Sub-Advisor a monthly Investment Management Fee. The
Investment Management Fee shall be equal to: (i) 50% of the monthly
management fee rate (including performance adjustments, if any) that
the Portfolio is obligated to pay the Advisor under its Management
Contract with the Advisor, multiplied by: (ii) the fraction equal to
the net assets of the Portfolio as to which the Sub-Advisor shall have
provided investment management services divided by the net assets of
the Portfolio for that month. If in any fiscal year the aggregate
expenses of the Portfolio exceed any applicable expense limitation
imposed by any state or federal securities laws or regulations, and
the Advisor waives all or a portion of its management fee or
reimburses the Portfolio for expenses to the extent required to
satisfy such limitation, the Investment Management Fee paid to the
Sub-Advisor will be reduced by 50% of the amount of such waivers or
reimbursements multiplied by the fraction determined in (ii). If the
Sub-Advisor reduces its fees to reflect such waivers or reimbursements
and the Advisor subsequently recovers all or any portion of such
waivers and reimbursements, then the Sub-Advisor shall be entitled to
receive from the Advisor a proportionate share of the amount
recovered. To the extent that waivers and reimbursements by the
Advisor required by such limitations are in excess of the Advisor's
management fee, the Investment Management Fee paid to the Sub-Advisor
will be reduced to zero for that month, but in no event shall the
Sub-Advisor be required to reimburse the Advisor for all or a portion
of such excess reimbursements.
(c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have
provided both investment advisory services under subparagraph (a) and
investment management services under subparagraph (b) of paragraph 1
for the same portion of the investments of the Portfolio for the same
period, the fees paid to the Sub-Advisor with respect to such
investments shall be calculated exclusively under subparagraph (b) of
this paragraph 4.
5. Expenses: It is understood that the Portfolio will pay all of its
expenses other than those expressly stated to be payable by the
Sub-Advisor hereunder or by the Advisor under the Management Contract
with the Portfolio, which expenses payable by the Portfolio shall
include, without limitation, (i) interest and taxes; (ii) brokerage
commissions and other costs in connection with the purchase or sale of
securities and other investment instruments; (iii) fees and expenses
of the Trust's Trustees other than those who are "interested persons"
of the Trust, the Sub-Advisor or the Advisor; (iv) legal and audit
expenses; (v) custodian, registrar and transfer agent fees and
expenses; (vi) fees and expenses related to the registration and
qualification of the Trust and the Portfolio's shares for distribution
under state and federal securities laws; (vii) expenses of printing
and mailing reports and notices and proxy material to shareholders of
the Portfolio; (viii) all other expenses incidental to holding
meetings of the Portfolio's shareholders, including proxy
solicitations therefore; (ix) a pro rata share, based on relative net
assets of the Portfolio and other registered investment companies
having Advisory and Service or Management Contracts with the Advisor,
of 50% of insurance premiums for fidelity and other coverage; (x) its
proportionate share of association membership dues; (xi) expenses of
typesetting for printing Prospectuses and Statements of Additional
Information and supplements thereto; (xii) expenses of printing and
mailing Prospectuses and Statements of Additional Information and
supplements thereto sent to existing shareholders; and (xiii) such
non-recurring or extraordinary expenses as may arise, including those
relating to actions, suits or proceedings to which the Portfolio is a
party and the legal obligation which the Portfolio may have to
indemnify the Trust's Trustees and officers with respect thereto.
6. Interested Persons: It is understood that Trustees, officers,
and shareholders of the Trust are or may be or become interested in
the Advisor or the Sub-Advisor as directors, officers or otherwise and
that directors, officers and stockholders of the Advisor or the
Sub-Advisor are or may be or become similarly interested in the Trust,
and that the Advisor or the Sub-Advisor may be or become interested in
the Trust as a shareholder or otherwise.
7. Services to Other Companies or Accounts: The services of the
Sub-Advisor to the Advisor are not to be deemed to be exclusive, the
Sub-Advisor being free to render services to others and engage in
other activities, provided, however, that such other services and
activities do not, during the term of this Agreement, interfere, in a
material manner, with the Sub-Advisor's ability to meet all of its
obligations hereunder. The Sub-Advisor shall for all purposes be an
independent contractor and not an agent or employee of the Advisor or
the Trust.
8. Standard of Care: In the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be
subject to liability to the Advisor, the Trust or to any shareholder
of the Portfolio for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that
may be sustained in the purchase, holding or sale of any security.
9. Duration and Termination of Agreement; Amendments:
(a) Subject to prior termination as provided in subparagraph (d) of
this paragraph 9, this Agreement shall continue in force until July
31, 1999 and indefinitely thereafter, but only so long as the
continuance after such period shall be specifically approved at least
annually by vote of the Trust's Board of Trustees or by vote of a
majority of the outstanding voting securities of the Portfolio.
(b) This Agreement may be modified by mutual consent of the Advisor,
the Sub-Advisor and the Portfolio subject to the provisions of Section
15 of the 1940 Act, as modified by or interpreted by any applicable
order or orders of the Securities and Exchange Commission (the
"Commission") or any rules or regulations adopted by, or
interpretative releases of, the Commission.
(c) In addition to the requirements of subparagraphs (a) and (b) of
this paragraph 9, the terms of any continuance or modification of this
Agreement must have been approved by the vote of a majority of those
Trustees of the Trust who are not parties to this Agreement or
interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval.
(d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any
time on sixty (60) days' prior written notice to the other parties,
terminate this Agreement, without payment of any penalty, by action of
its Board of Trustees or Directors, or with respect to the Portfolio
by vote of a majority of its outstanding voting securities. This
Agreement shall terminate automatically in the event of its
assignment.
10. Limitation of Liability: The Sub-Advisor is hereby expressly
put on notice of the limitation of shareholder liability as set forth
in the Declaration of Trust or other organizational document of the
Trust and agrees that any obligations of the Trust or the Portfolio
arising in connection with this Agreement shall be limited in all
cases to the Portfolio and its assets, and the Sub-Advisor shall not
seek satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio. Nor shall the Sub-Advisor seek
satisfaction of any such obligation from the Trustees or any
individual Trustee.
11. Governing Law: This Agreement shall be governed by, and
construed in accordance with, the laws of the Commonwealth of
Massachusetts, without giving effect to the choice of laws provisions
thereof.
The terms "registered investment company," "vote of a majority of the
outstanding voting securities," "assignment," and "interested
persons," when used herein, shall have the respective meanings
specified in the 1940 Act as now in effect or as hereafter amended.
IN WITNESS WHEREOF the parties hereto have caused this instrument to
be signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
FIDELITY MANAGEMENT & RESEARCH (Far East) INC.
By: /s/ Brian A. Clancy
Treasurer
FIDELITY MANAGEMENT & RESEARCH COMPANY
By: /s/ Robert C. Pozen
President
FIDELITY ADVISOR SERIES I
on behalf of Fidelity Advisor Small Cap Fund
By: /s/ Robert C. Pozen
Senior Vice President
GENERAL DISTRIBUTION AGREEMENT
between
FIDELITY ADVISOR SERIES I
and
FIDELITY DISTRIBUTORS CORPORATION
Agreement made this 16th day of July, 1998, between Fidelity Advisor
Series I, a Massachusetts 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
Fidelity Advisor Small Cap 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
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 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, 1999 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.
FIDELITY ADVISOR SERIES I
By: /s/ Robert C. Pozen
Senior Vice President
FIDELITY DISTRIBUTORS CORPORATION
By: /s/ Martha B. Willis President
Form of
CUSTODIAN AGREEMENT
Dated as of: __________
Between
Each of the Investment Companies
Listed on Appendix "A" Attached Hereto
and
State Street Bank and Trust Company
TABLE OF CONTENTS
ARTICLE
Page
I. APPOINTMENT OF CUSTODIAN 6
II. POWERS AND DUTIES OF CUSTODIAN 6
2.01 Safekeeping 6
2.02 Manner of Holding Securities 6
2.03 Security Purchases 7
2.04 Exchanges of Securities 7
2.05 Sales of Securities 8
2.06 Depositary Receipts 8
2.07 Exercise of Rights; Tender Offers 8
2.08 Stock Dividends, Rights, Etc. 9
2.09 Options 9
2.10 Futures Contracts 9
2.11 Borrowing 9
2.12 Interest Bearing Deposits 9
2.13 Foreign Exchange Transactions 10
2.14 Securities Loans 11
2.15 Collections 11
2.16 Dividends, Distributions and Redemptions 11
2.17 Proceeds from Shares Sold 11
2.18 Proxies, Notices, Etc. 12
2.19 Bills and Other Disbursements 12
2.20 Nondiscretionary Functions 12
2.21 Bank Accounts 12
2.22 Deposit of Fund Assets in Securities Systems 13
2.23 Other Transfers 14
2.24 Establishment of Segregated Account 14
2.25 Custodian's Books and Records . 14
2.26 Opinion of Fund's Independent Certified Public
Accountants 15
2.27 Reports of Independent Certified Public Accountants 15
2.28 Overdraft Facility 15
i
III. PROPER INSTRUCTIONS, SPECIAL INSTRUCTIONS
AND RELATED MATTERS 16
3.01 Proper Instructions and Special Instructions 16
3.02 Authorized Persons 16
3.03 Persons Having Access to Assets of the Portfolios 16
3.04 Actions of the Custodian Based on Proper Instructions and
Special Instructions 17
IV. SUBCUSTODIANS 17
4.01 Domestic Subcustodians 17
4.02 Foreign Subcustodians and Interim Subcustodians 17
4.03 Special Subcustodians 18
4.04 Termination of a Subcustodian 19
4.05 Certification Regarding Foreign Subcustodians 19
V. STANDARD OF CARE; INDEMNIFICATION 19
5.01 Standard of Care 19
5.02 Liability of Custodian for Actions of Other Persons 20
5.03 Indemnification 21
5.04 Investment Limitations 22
5.05 Fund's Right to Proceed 22
VI. COMPENSATION 22
VII. TERMINATION 22
7.01 Termination of Agreement as to One or More Funds 22
7.02 Termination as to One or More Portfolios 23
VIII. DEFINED TERMS 23
IX. MISCELLANEOUS 24
9.01 Execution of Documents, Etc 24
9.02 Representative Capacity; Nonrecourse Obligations 24
9.03 Several Obligations of the Funds and the Portfolios 25
9.04 Representations and Warranties 25
9.05 Entire Agreement 25
9.06 Waivers and Amendments 25
ii
9.07 Interpretation 26
9.08 Captions 26
9.09 Governing Law 26
9.10 Notices 26
9.11 Assignment 27
9.12 Counterparts 27
9.13 Confidentiality; Survival of Obligations 27
iii
APPENDICES
Appendix "A" - List of Funds and Portfolios
Appendix "B" - List of Additional Custodians, Special
Subcustodians and Foreign Subcustodians
Appendix "C" - Procedures Relating to
Custodian's Security Interest
iv
CUSTODIAN AGREEMENT
AGREEMENT made as of the 1st day of February 1996 between each of the
Investment Companies listed on Appendix "A" hereto, as the same may be
amended from time to time (each a "Fund" and collectively the "Funds")
and State Street Bank and Trust Company (the "Custodian").
W I T N E S S E T H
WHEREAS, each Fund is or may be organized with one or more series of
shares, each of which shall represent an interest in a separate
portfolio of cash, securities and other assets (all such existing and
additional series now or hereafter listed on Appendix "A" being
hereinafter referred to individually, as a "Portfolio," and
collectively, as the "Portfolios"); and
WHEREAS, each Fund desires to appoint the Custodian as custodian on
behalf of each of its Portfolios in accordance with the provisions of
the Investment Company Act of 1940, as amended (the "1940 Act"), and
the rules and regulations thereunder, under the terms and conditions
set forth in this Agreement, and the Custodian has agreed so to act as
custodian.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, the parties hereto agree as follows:
ARTICLE I
APPOINTMENT OF CUSTODIAN
On behalf of each of its Portfolios, each Fund hereby employs and
appoints the Custodian as a custodian, subject to the terms and
provisions of this Agreement. Each Fund shall deliver to the
Custodian, or shall cause to be delivered to the Custodian, cash,
securities and other assets owned by each of its Portfolios from time
to time during the term of this Agreement and shall specify to which
of its Portfolios such cash, securities and other assets are to be
specifically allocated.
ARTICLE II
POWERS AND DUTIES OF CUSTODIAN
As custodian, the Custodian shall have and perform the powers and
duties set forth in this Article II. Pursuant to and in accordance
with Article IV hereof, the Custodian may appoint one or more
Subcustodians (as hereinafter defined) to exercise the powers and
perform the duties of the Custodian set forth in this Article II and
references to the Custodian in this Article II shall include any
Subcustodian so appointed.
Section 2.01. Safekeeping. The Custodian shall keep safely all
cash, securities and other assets of each Fund's Portfolios delivered
to the Custodian and, on behalf of such Portfolios, the Custodian
shall, from time to time, accept delivery of cash, securities and
other assets for safekeeping.
Section 2.02. Manner of Holding Securities.
(a) The Custodian shall at all times hold securities of each Fund's
Portfolios either: (i) by physical possession of the share
certificates or other instruments representing such securities in
registered or bearer form; or (ii) in book-entry form by a Securities
System (as hereinafter defined) in accordance with the provisions of
Section 2.22 below.
(b) The Custodian shall at all times hold registered securities of
each Portfolio in the name of the Custodian, the Portfolio or a
nominee of either of them, unless specifically directed by Proper
Instructions to hold such registered securities in so-called street
name; provided that, in any event, all such securities and other
assets shall be held in an account of the Custodian containing only
assets of a Portfolio, or only assets held by the Custodian as a
fiduciary or custodian for customers; and provided further, that the
records of the Custodian shall indicate at all times the Portfolio or
other customer for which such securities and other assets are held in
such account and the respective interests therein.
Section 2.03. Security Purchases. Upon receipt of Proper
Instructions (as hereinafter defined), the Custodian shall pay for and
receive securities purchased for the account of a Portfolio, provided
that payment shall be made by the Custodian only upon receipt of the
securities: (a) by the Custodian; (b) by a clearing corporation of a
national securities exchange of which the Custodian is a member; or
(c) by a Securities System. Notwithstanding the foregoing, upon
receipt of Proper Instructions: (i) in the case of a repurchase
agreement, the Custodian may release funds to a Securities System
prior to the receipt of advice from the Securities System that the
securities underlying such repurchase agreement have been transferred
by book-entry into the Account (as hereinafter defined) maintained
with such Securities System by the Custodian, provided that the
Custodian's instructions to the Securities System require that the
Securities System may make payment of such funds to the other party to
the repurchase agreement only upon transfer by book-entry of the
securities underlying the repurchase agreement into the Account; (ii)
in the case of time deposits, call account deposits, currency
deposits, and other deposits, foreign exchange transactions, futures
contracts or options, pursuant to Sections 2.09, 2.10, 2.12 and 2.13
hereof, the Custodian may make payment therefor before receipt of an
advice or confirmation evidencing said deposit or entry into such
transaction; (iii) in the case of the purchase of securities, the
settlement of which occurs outside of the United States of America,
the Custodian may make payment therefor and receive delivery of such
securities in accordance with local custom and practice generally
accepted by Institutional Clients (as hereinafter defined) in the
country in which the settlement occurs, but in all events subject to
the standard of care set forth in Article V hereof; and (iv) in the
case of the purchase of securities in which, in accordance with
standard industry custom and practice generally accepted by
Institutional Clients with respect to such securities, the receipt of
such securities and the payment therefor take place in different
countries, the Custodian may receive delivery of such securities and
make payment therefor in accordance with standard industry custom and
practice for such securities generally accepted by Institutional
Clients, but in all events subject to the standard of care set forth
in Article V hereof. For purposes of this Agreement, an
"Institutional Client" shall mean a major commercial bank,
corporation, insurance company, or substantially similar institution,
which, as a substantial part of its business operations, purchases or
sells securities and makes use of custodial services.
Section 2.04. Exchanges of Securities. Upon receipt of Proper
Instructions, the Custodian shall exchange securities held by it for
the account of a Portfolio for other securities in connection with any
reorganization, recapitalization, split-up of shares, change of par
value, conversion or other event relating to the securities or the
issuer of such securities, and shall deposit any such securities in
accordance with the terms of any reorganization or protective plan.
The Custodian shall, without receiving Proper Instructions: surrender
securities in temporary form for definitive securities; surrender
securities for transfer into the name of the Custodian, a Portfolio or
a nominee of either of them, as permitted by Section 2.02(b); and
surrender securities for a different number of certificates or
instruments representing the same number of shares or same principal
amount of indebtedness, provided that the securities to be issued will
be delivered to the Custodian or a nominee of the Custodian.
Section 2.05. Sales of Securities. Upon receipt of Proper
Instructions, the Custodian shall make delivery of securities which
have been sold for the account of a Portfolio, but only against
payment therefor in the form of: (a) cash, certified check, bank
cashier's check, bank credit, or bank wire transfer; (b) credit to the
account of the Custodian with a clearing corporation of a national
securities exchange of which the Custodian is a member; or (c) credit
to the Account of the Custodian with a Securities System, in
accordance with the provisions of Section 2.22 hereof.
Notwithstanding the foregoing: (i) in the case of the sale of
securities, the settlement of which occurs outside of the United
States of America, such securities shall be delivered and paid for in
accordance with local custom and practice generally accepted by
Institutional Clients in the country in which the settlement occurs,
but in all events subject to the standard of care set forth in Article
V hereof; (ii) in the case of the sale of securities in which, in
accordance with standard industry custom and practice generally
accepted by Institutional Clients with respect to such securities, the
delivery of such securities and receipt of payment therefor take place
in different countries, the Custodian may deliver such securities and
receive payment therefor in accordance with standard industry custom
and practice for such securities generally accepted by Institutional
Clients, but in all events subject to the standard of care set forth
in Article V hereof; and (iii) in the case of securities held in
physical form, such securities shall be delivered and paid for in
accordance with "street delivery custom" to a broker or its clearing
agent, against delivery to the Custodian of a receipt for such
securities, provided that the Custodian shall have taken reasonable
steps to ensure prompt collection of the payment for, or the return
of, such securities by the broker or its clearing agent, and provided
further that the Custodian shall not be responsible for the selection
of or the failure or inability to perform of such broker or its
clearing agent.
Section 2.06. Depositary Receipts. Upon receipt of Proper
Instructions, the Custodian shall surrender securities to the
depositary used for such securities by an issuer of American
Depositary Receipts, Global Depository Receipts or International
Depositary Receipts (hereinafter referred to, collectively, as
"ADRs"), against a written receipt therefor adequately describing such
securities and written evidence satisfactory to the Custodian that the
depositary has acknowledged receipt of instructions to issue ADRs with
respect to such securities in the name of the Custodian or a nominee
of the Custodian, for delivery to the Custodian at such place as the
Custodian may from time to time designate. Upon receipt of Proper
Instructions, the Custodian shall surrender ADRs to the issuer
thereof, against a written receipt therefor adequately describing the
ADRs surrendered and written evidence satisfactory to the Custodian
that the issuer of the ADRs has acknowledged receipt of instructions
to cause its depository to deliver the securities underlying such ADRs
to the Custodian.
Section 2.07. Exercise of Rights; Tender Offers. Upon receipt of
Proper Instructions, the Custodian shall: (a) deliver warrants, puts,
calls, rights or similar securities to the issuer or trustee thereof,
or to the agent of such issuer or trustee, for the purpose of exercise
or sale, provided that the new securities, cash or other assets, if
any, acquired as a result of such actions are to be delivered to the
Custodian; and (b) deposit securities upon invitations for tenders
thereof, provided that the consideration for such securities is to be
paid or delivered to the Custodian, or the tendered securities are to
be returned to the Custodian. Notwithstanding any provision of this
Agreement to the contrary, the Custodian shall take all necessary
action, unless otherwise directed to the contrary in Proper
Instructions, to comply with the terms of all mandatory or compulsory
exchanges, calls, tenders, redemptions, or similar rights of security
ownership, and shall promptly notify each applicable Fund of such
action in writing by facsimile transmission or in such other manner as
such Fund and the Custodian may agree in writing.
Section 2.08. Stock Dividends, Rights, Etc. The Custodian shall
receive and collect all stock dividends, rights and other items of
like nature and, upon receipt of Proper Instructions, take action with
respect to the same as directed in such Proper Instructions.
Section 2.09. Options. Upon receipt of Proper Instructions and in
accordance with the provisions of any agreement between the Custodian,
any registered broker-dealer and, if necessary, a Fund on behalf of
any applicable Portfolio relating to compliance with the rules of the
Options Clearing Corporation or of any registered national securities
exchange or similar organization(s), the Custodian shall: (a) receive
and retain confirmations or other documents, if any, evidencing the
purchase or writing of an option on a security or securities index by
the applicable Portfolio; (b) deposit and maintain in a segregated
account, securities (either physically or by book-entry in a
Securities System), cash or other assets; and (c) pay, release and/or
transfer such securities, cash or other assets in accordance with
notices or other communications evidencing the expiration, termination
or exercise of such options furnished by the Options Clearing
Corporation, the securities or options exchange on which such options
are traded, or such other organization as may be responsible for
handling such option transactions. Each Fund, on behalf of its
applicable Portfolios, and the broker-dealer shall be responsible for
the sufficiency of assets held in any segregated account established
in compliance with applicable margin maintenance requirements and the
performance of other terms of any option contract.
Section 2.10. Futures Contracts. Upon receipt of Proper
Instructions, or pursuant to the provisions of any futures margin
procedural agreement among a Fund, on behalf of any applicable
Portfolio, the Custodian and any futures commission merchant (a
"Procedural Agreement"), the Custodian shall: (a) receive and retain
confirmations, if any, evidencing the purchase or sale of a futures
contract or an option on a futures contract by the applicable
Portfolio; (b) deposit and maintain in a segregated account, cash,
securities and other assets designated as initial, maintenance or
variation "margin" deposits intended to secure the applicable
Portfolio's performance of its obligations under any futures contracts
purchased or sold or any options on futures contracts written by the
Portfolio, in accordance with the provisions of any Procedural
Agreement designed to comply with the rules of the Commodity Futures
Trading Commission and/or any commodity exchange or contract market
(such as the Chicago Board of Trade), or any similar organization(s),
regarding such margin deposits; and (c) release assets from and/or
transfer assets into such margin accounts only in accordance with any
such Procedural Agreements. Each Fund, on behalf of its applicable
Portfolios, and such futures commission merchant shall be responsible
for the sufficiency of assets held in the segregated account in
compliance with applicable margin maintenance requirements and the
performance of any futures contract or option on a futures contract in
accordance with its terms.
Section 2.11. Borrowing. Upon receipt of Proper Instructions, the
Custodian shall deliver securities of a Portfolio to lenders or their
agents, or otherwise establish a segregated account as agreed to by
the applicable Fund on behalf of such Portfolio and the Custodian, as
collateral for borrowings effected by such Portfolio, provided that
such borrowed money is payable by the lender (a) to or upon the
Custodian's order, as Custodian for such Portfolio, and (b)
concurrently with delivery of such securities.
Section 2.12. Interest Bearing Deposits.
Upon receipt of Proper Instructions directing the Custodian to
purchase interest bearing fixed term and call deposits (hereinafter
referred to collectively, as "Interest Bearing Deposits") for the
account of a Portfolio, the Custodian shall purchase such Interest
Bearing Deposits in the name of the Portfolio with such banks or trust
companies (including the Custodian, any Subcustodian or any subsidiary
or affiliate of the Custodian) (hereinafter referred to as "Banking
Institutions") and in such amounts as the applicable Fund may direct
pursuant to Proper Instructions. Such Interest Bearing Deposits may
be denominated in U.S. Dollars or other currencies, as the applicable
Fund on behalf of its Portfolio may determine and direct pursuant to
Proper Instructions. The Custodian shall include in its records with
respect to the assets of each Portfolio appropriate notation as to the
amount and currency of each such Interest Bearing Bank Deposit, the
accepting Banking Institution and all other appropriate details, and
shall retain such forms of advice or receipt evidencing such account,
if any, as may be forwarded to the Custodian by the Banking
Institution. The responsibilities of the Custodian to each Fund for
Interest Bearing Deposits accepted on the Custodian's books in the
United States on behalf of the Fund's Portfolios shall be that of a
U.S. bank for a similar deposit. With respect to Interest Bearing
Deposits other than those accepted on the Custodian's books, (a) the
Custodian shall be responsible for the collection of income as set
forth in Section 2.15 and the transmission of cash and instructions to
and from such accounts; and (b) the Custodian shall have no duty with
respect to the selection of the Banking Institution or, so long as the
Custodian acts in accordance with Proper Instructions, for the failure
of such Banking Institution to pay upon demand. Upon receipt of
Proper Instructions, the Custodian shall take such reasonable actions
as the applicable Fund deems necessary or appropriate to cause each
such Interest Bearing Deposit Account to be insured to the maximum
extent possible by all applicable deposit insurers including, without
limitation, the Federal Deposit Insurance Corporation.
Section 2.13. Foreign Exchange Transactions
(a) Foreign Exchange Transactions Other Than as Principal. Upon
receipt of Proper Instructions, the Custodian shall settle foreign
exchange contracts or options to purchase and sell foreign currencies
for spot and future delivery on behalf of and for the account of a
Portfolio with such currency brokers or Banking Institutions as the
applicable Fund may determine and direct pursuant to Proper
Instructions. The Custodian shall be responsible for the transmission
of cash and instructions to and from the currency broker or Banking
Institution with which the contract or option is made, the safekeeping
of all certificates and other documents and agreements evidencing or
relating to such foreign exchange transactions and the maintenance of
proper records as set forth in Section 2.25. The Custodian shall have
no duty with respect to the selection of the currency brokers or
Banking Institutions with which a Fund deals on behalf of its
Portfolios or, so long as the Custodian acts in accordance with Proper
Instructions, for the failure of such brokers or Banking Institutions
to comply with the terms of any contract or option.
(b) Foreign Exchange Contracts as Principal. The Custodian shall
not be obligated to enter into foreign exchange transactions as
principal. However, if the Custodian has made available to a Fund its
services as a principal in foreign exchange transactions, upon receipt
of Proper Instructions, the Custodian shall enter into foreign
exchange contracts or options to purchase and sell foreign currencies
for spot and future delivery on behalf of and for the account of a
Portfolio of such Fund with the Custodian as principal. The Custodian
shall be responsible for the selection of the currency brokers or
Banking Institutions and the failure of such currency brokers or
Banking Institutions to comply with the terms of any contract or
option.
(c) Payments. Notwithstanding anything to the contrary contained
herein, upon receipt of Proper Instructions the Custodian may, in
connection with a foreign exchange contract, make free outgoing
payments of cash in the form of U.S. Dollars or foreign currency prior
to receipt of confirmation of such foreign exchange contract or
confirmation that the countervalue currency completing such contract
has been delivered or received.
Section 2.14. Securities Loans. Upon receipt of Proper
Instructions, the Custodian shall, in connection with loans of
securities by a Portfolio, deliver securities of such Portfolio to the
borrower thereof prior to receipt of the collateral, if any, for such
borrowing; provided that, in cases of loans of securities secured by
cash collateral, the Custodian's instructions to the Securities System
shall require that the Securities System deliver the securities of the
Portfolio to the borrower thereof only upon receipt of the collateral
for such borrowing.
Section 2.15. Collections. The Custodian shall, and shall cause any
Subcustodian to: (a) collect amounts due and payable to each Fund
with respect to portfolio securities and other assets of each of such
Fund's Portfolios; (b) promptly credit to the account of each
applicable Portfolio all income and other payments relating to
portfolio securities and other assets held by the Custodian hereunder
upon Custodian's receipt of such income or payments or as otherwise
agreed in writing by the Custodian and the applicable Fund; (c)
promptly endorse and deliver any instruments required to effect such
collections; (d) promptly execute ownership and other certificates and
affidavits for all federal, state and foreign tax purposes in
connection with receipt of income, capital gains or other payments
with respect to portfolio securities and other assets of each
applicable Portfolio, or in connection with the purchase, sale or
transfer of such securities or other assets; and (e) promptly file any
certificates or other affidavits for the refund or reclaim of foreign
taxes paid, and promptly notify each applicable Fund of any changes to
law, interpretative rulings or procedures regarding such reclaims, and
otherwise use all available measures customarily used to minimize the
imposition of foreign taxes at source, and promptly inform each
applicable Fund of alternative means of minimizing such taxes of which
the Custodian shall become aware (or with the exercise of reasonable
care should have become aware); provided, however, that with respect
to portfolio securities registered in so-called street name, the
Custodian shall use its best efforts to collect amounts due and
payable to each Fund with respect to its Portfolios. The Custodian
shall promptly notify each applicable Fund in writing by facsimile
transmission or in such other manner as each such Fund and the
Custodian may agree in writing if any amount payable with respect to
portfolio securities or other assets of the Portfolios of such Fund(s)
is not received by the Custodian when due. The Custodian shall not be
responsible for the collection of amounts due and payable with respect
to portfolio securities or other assets that are in default.
Section 2.16. Dividends, Distributions and Redemptions. The
Custodian shall promptly release funds or securities: (a) upon
receipt of Proper Instructions, to one or more Distribution Accounts
designated by the applicable Fund or Funds in such Proper
Instructions; or (b) upon receipt of Special Instructions, as
otherwise directed by the applicable Fund or Funds, for the purpose of
the payment of dividends or other distributions to shareholders of
each applicable Portfolio, and payment to shareholders who have
requested repurchase or redemption of their shares of the Portfolio(s)
(collectively, the "Shares"). For purposes of this Agreement, a
"Distribution Account" shall mean an account established at a Banking
Institution designated by the applicable Fund on behalf of one or more
of its Portfolios in Special Instructions.
Section 2.17. Proceeds from Shares Sold. The Custodian shall
receive funds representing cash payments received for Shares issued or
sold from time to time by the Funds, and shall promptly credit such
funds to the account(s) of the applicable Portfolio(s). The Custodian
shall promptly notify each applicable Fund of Custodian's receipt of
cash in payment for Shares issued by such Fund by facsimile
transmission or in such other manner as the Fund and Custodian may
agree in writing. Upon receipt of Proper Instructions, the Custodian
shall: (a) deliver all federal funds received by the Custodian in
payment for Shares in payment for such investments as may be set forth
in such Proper Instructions and at a time agreed upon between the
Custodian and the applicable Fund; and (b) make federal funds
available to the applicable Fund as of specified times agreed upon
from time to time by the applicable Fund and the Custodian, in the
amount of checks received in payment for Shares which are deposited to
the accounts of each applicable Portfolio.
Section 2.18. Proxies, Notices, Etc. The Custodian shall deliver to
each applicable Fund, in the most expeditious manner practicable, all
forms of proxies, all notices of meetings, and any other notices or
announcements affecting or relating to securities owned by one or more
of the applicable Fund's Portfolios that are received by the
Custodian, any Subcustodian, or any nominee of either of them, and,
upon receipt of Proper Instructions, the Custodian shall execute and
deliver, or cause such Subcustodian or nominee to execute and deliver,
such proxies or other authorizations as may be required. Except as
directed pursuant to Proper Instructions, neither the Custodian nor
any Subcustodian or nominee shall vote upon any such securities, or
execute any proxy to vote thereon, or give any consent or take any
other action with respect thereto.
Section 2.19. Bills and Other Disbursements. Upon receipt of Proper
Instructions, the Custodian shall pay or cause to be paid, all bills,
statements, or other obligations of each Portfolio.
Section 2.20. Nondiscretionary Functions. The Custodian shall
attend to all nondiscretionary details in connection with the sale,
exchange, substitution, purchase, transfer or other dealings with
securities or other assets of each Portfolio held by the Custodian,
except as otherwise directed from time to time pursuant to Proper
Instructions.
Section 2.21. Bank Accounts.
(a) Accounts with the Custodian and any Subcustodians. The Custodian
shall open and operate a bank account or accounts (hereinafter
referred to collectively, as "Bank Accounts") on the books of the
Custodian or any Subcustodian provided that such account(s) shall be
in the name of the Custodian or a nominee of the Custodian, for the
account of a Portfolio, and shall be subject only to the draft or
order of the Custodian; provided however, that such Bank Accounts in
countries other than the United States may be held in an account of
the Custodian containing only assets held by the Custodian as a
fiduciary or custodian for customers, and provided further, that the
records of the Custodian shall indicate at all times the Portfolio or
other customer for which such securities and other assets are held in
such account and the respective interests therein. Such Bank Accounts
may be denominated in either U.S. Dollars or other currencies. The
responsibilities of the Custodian to each applicable Fund for deposits
accepted on the Custodian's books in the United States shall be that
of a U.S. bank for a similar deposit. The responsibilities of the
Custodian to each applicable Fund for deposits accepted on any
Subcustodian's books shall be governed by the provisions of Section
5.02.
(b) Accounts With Other Banking Institutions. The Custodian may open
and operate Bank Accounts on behalf of a Portfolio, in the name of the
Custodian or a nominee of the Custodian, at a Banking Institution
other than the Custodian or any Subcustodian, provided that such
account(s) shall be in the name of the Custodian or a nominee of the
Custodian, for the account of a Portfolio, and shall be subject only
to the draft or order of the Custodian; provided however, that such
Bank Accounts may be held in an account of the Custodian containing
only assets held by the Custodian as a fiduciary or custodian for
customers, and provided further, that the records of the Custodian
shall indicate at all times the Portfolio or other customer for which
such securities and other assets are held in such account and the
respective interests therein. Such Bank Accounts may be denominated
in either U.S. Dollars or other currencies. Subject to the provisions
of Section 5.01(a), the Custodian shall be responsible for the
selection of the Banking Institution and for the failure of such
Banking Institution to pay according to the terms of the deposit.
(c) Deposit Insurance. Upon receipt of Proper Instructions, the
Custodian shall take such reasonable actions as the applicable Fund
deems necessary or appropriate to cause each deposit account
established by the Custodian pursuant to this Section 2.21 to be
insured to the maximum extent possible by all applicable deposit
insurers including, without limitation, the Federal Deposit Insurance
Corporation.
Section 2.22. Deposit of Fund Assets in Securities Systems. The
Custodian may deposit and/or maintain domestic securities owned by a
Portfolio in: (a) The Depository Trust Company; (b) the Participants
Trust Company; (c) any book-entry system as provided in (i) Subpart O
of Treasury Circular No. 300, 31 CFR 306.115, (ii) Subpart B of
Treasury Circular Public Debt Series No. 27-76, 31 CFR 350.2, or (iii)
the book-entry regulations of federal agencies substantially in the
form of 31 CFR 306.115; or (d) any other domestic clearing agency
registered with the Securities and Exchange Commission ("SEC") under
Section 17A of the Securities Exchange Act of 1934 (or as may
otherwise be authorized by the Securities and Exchange Commission to
serve in the capacity of depository or clearing agent for the
securities or other assets of investment companies) which acts as a
securities depository and the use of which each applicable Fund has
previously approved by Special Instructions (as hereinafter defined)
(each of the foregoing being referred to in this Agreement as a
"Securities System"). Use of a Securities System shall be in
accordance with applicable Federal Reserve Board and SEC rules and
regulations, if any, and subject to the following provisions:
(A) The Custodian may deposit and/or maintain securities held
hereunder in a Securities System, provided that such securities are
represented in an account ("Account") of the Custodian in the
Securities System which Account shall not contain any assets of the
Custodian other than assets held as a fiduciary, custodian, or
otherwise for customers and shall be so designated on the books and
records of the Securities System.
(B) The Securities System shall be obligated to comply with the
Custodian's directions with respect to the securities held in such
Account and shall not be entitled to a lien against the assets in such
Account for extensions of credit to the Custodian other than for
payment of the purchase price of such assets.
(C) Each Fund hereby designates the Custodian as the party in whose
name any securities deposited by the Custodian in the Account are to
be registered.
(D) The books and records of the Custodian shall at all times
identify those securities belonging to each Portfolio which are
maintained in a Securities System.
(E) The Custodian shall pay for securities purchased for the account
of a Portfolio only upon (w) receipt of advice from the Securities
System that such securities have been transferred to the Account of
the Custodian, and (x) the making of an entry on the records of the
Custodian to reflect such payment and transfer for the account of such
Portfolio. The Custodian shall transfer securities sold for the
account of a Portfolio only upon (y) receipt of advice from the
Securities System that payment for such securities has been
transferred to the Account of the Custodian, and (z) the making of an
entry on the records of the Custodian to reflect such transfer and
payment for the account of such Portfolio. Copies of all advices from
the Securities System relating to transfers of securities for the
account of a Portfolio shall identify such Portfolio and shall be
maintained for such Portfolio by the Custodian. The Custodian shall
deliver to each applicable Fund on the next succeeding business day
daily transaction reports which shall include each day's transactions
in the Securities System for the account of each applicable Portfolio.
Such transaction reports shall be delivered to each applicable Fund or
any agent designated by such Fund pursuant to Proper Instructions, by
computer or in such other manner as such Fund and the Custodian may
agree in writing.
(F) The Custodian shall, if requested by a Fund pursuant to Proper
Instructions, provide such Fund with all reports obtained by the
Custodian or any Subcustodian with respect to a Securities System's
accounting system, internal accounting control and procedures for
safeguarding securities deposited in the Securities System.
(G) Upon receipt of Special Instructions, the Custodian shall
terminate the use of any Securities System (except the federal
book-entry system) on behalf of any Portfolio as promptly as
practicable and shall take all actions reasonably practicable to
safeguard the securities of any Portfolio maintained with such
Securities System.
Section 2.23. Other Transfers.
(a) Upon receipt of Proper Instructions, the custodian shall transfer
to or receive from a third party that has been appointed to serve as
an additional custodian of one or more Portfolios (an "Additional
Custodian") securities, cash and other assets of such Portfolio(s) in
accordance with such Proper Instructions. Each Additional Custodian
shall be identified as such on Appendix B, as the same may be amended
from time to time in accordance with the provisions of Section
9.06(c).
(b) Upon receipt of Special Instructions, the Custodian shall make
such other dispositions of securities, funds or other property of a
Portfolio in a manner or for purposes other than as expressly set
forth in this Agreement, provided that the Special Instructions
relating to such disposition shall include a statement of the purpose
for which the delivery is to be made, the amount of funds and/or
securities to be delivered, and the name of the person or persons to
whom delivery is to be made, and shall otherwise comply with the
provisions of Sections 3.01 and 3.03 hereof.
Section 2.24. Establishment of Segregated Account. Upon receipt of
Proper Instructions, the Custodian shall establish and maintain on its
books a segregated account or accounts for and on behalf of a
Portfolio, into which account or accounts may be transferred cash
and/or securities or other assets of such Portfolio, including
securities maintained by the Custodian in a Securities System pursuant
to Section 2.22 hereof, said account or accounts to be maintained:
(a) for the purposes set forth in Sections 2.09, 2.10 and 2.11 hereof;
(b) for the purposes of compliance by the Portfolio with the
procedures required by Investment Company Act Release No. 10666, or
any subsequent release or releases of the SEC relating to the
maintenance of segregated accounts by registered investment companies;
or (c) for such other purposes as set forth, from time to time, in
Special Instructions.
Section 2.25. Custodian's Books and Records. The Custodian shall
provide any assistance reasonably requested by a Fund in the
preparation of reports to such Fund's shareholders and others, audits
of accounts, and other ministerial matters of like nature. The
Custodian shall maintain complete and accurate records with respect to
securities and other assets held for the accounts of each Portfolio as
required by the rules and regulations of the SEC applicable to
investment companies registered under the 1940 Act, including: (a)
journals or other records of original entry containing a detailed and
itemized daily record of all receipts and deliveries of securities
(including certificate and transaction identification numbers, if
any), and all receipts and disbursements of cash; (b) ledgers or other
records reflecting (i) securities in transfer, (ii) securities in
physical possession, (iii) securities borrowed, loaned or
collateralizing obligations of each Portfolio, (iv) monies borrowed
and monies loaned (together with a record of the collateral therefor
and substitutions of such collateral), (v) dividends and interest
received, (vi) the amount of tax withheld by any person in respect of
any collection made by the Custodian or any Subcustodian, and (vii)
the amount of reclaims or refunds for foreign taxes paid; and (c)
cancelled checks and bank records related thereto. The Custodian
shall keep such other books and records of each Fund as such Fund
shall reasonably request. All such books and records maintained by
the Custodian shall be maintained in a form acceptable to the
applicable Fund and in compliance with the rules and regulations of
the SEC, including, but not limited to, books and records required to
be maintained by Section 31(a) of the 1940 Act and the rules and
regulations from time to time adopted thereunder. All books and
records maintained by the Custodian pursuant to this Agreement shall
at all times be the property of each applicable Fund and shall be
available during normal business hours for inspection and use by such
Fund and its agents, including, without limitation, its independent
certified public accountants. Notwithstanding the preceding sentence,
no Fund shall take any actions or cause the Custodian to take any
actions which would cause, either directly or indirectly, the
Custodian to violate any applicable laws, regulations or orders.
Section 2.26. Opinion of Fund's Independent Certified Public
Accountants. The Custodian shall take all reasonable action as a Fund
may request to obtain from year to year favorable opinions from such
Fund's independent certified public accountants with respect to the
Custodian's activities hereunder in connection with the preparation of
the Fund's Form N-1A and the Fund's Form N-SAR or other periodic
reports to the SEC and with respect to any other requirements of the
SEC.
Section 2.27. Reports by Independent Certified Public Accountants.
At the request of a Fund, the Custodian shall deliver to such Fund a
written report prepared by the Custodian's independent certified
public accountants with respect to the services provided by the
Custodian under this Agreement, including, without limitation, the
Custodian's accounting system, internal accounting control and
procedures for safeguarding cash, securities and other assets,
including cash, securities and other assets deposited and/or
maintained in a Securities System or with a Subcustodian. Such report
shall be of sufficient scope and in sufficient detail as may
reasonably be required by any Fund and as may reasonably be obtained
by the Custodian.
Section 2.28. Overdraft Facility. In the event that the Custodian
is directed by Proper Instructions to make any payment or transfer of
funds on behalf of a Portfolio for which there would be, at the close
of business on the date of such payment or transfer, insufficient
funds held by the Custodian on behalf of such Portfolio, the Custodian
may, in its discretion, provide an overdraft (an "Overdraft") to the
applicable Fund on behalf of such Portfolio, in an amount sufficient
to allow the completion of such payment. Any Overdraft provided
hereunder: (a) shall be payable on the next Business Day, unless
otherwise agreed by the applicable Fund and the Custodian; and (b)
shall accrue interest from the date of the Overdraft to the date of
payment in full by the applicable Fund on behalf of the applicable
Portfolio at a rate agreed upon in writing, from time to time, by the
Custodian and the applicable Fund. The Custodian and each Fund
acknowledge that the purpose of such Overdrafts is to temporarily
finance the purchase or sale of securities for prompt delivery in
accordance with the terms hereof, or to meet emergency expenses not
reasonably foreseeable by such Fund. The Custodian shall promptly
notify each applicable Fund in writing (an "Overdraft Notice") of any
Overdraft by facsimile transmission or in such other manner as such
Fund and the Custodian may agree in writing. At the request of the
Custodian, each applicable Fund, on behalf of one or more of its
Portfolios, shall pledge, assign and grant to the Custodian a security
interest in certain specified securities of the applicable Portfolio,
as security for Overdrafts provided to such Portfolio, under the terms
and conditions set forth in Appendix "C" attached hereto.
ARTICLE III
PROPER INSTRUCTIONS, SPECIAL INSTRUCTIONS
AND RELATED MATTERS
Section 3.01. Proper Instructions and Special Instructions.
(a) Proper Instructions. As used herein, the term "Proper
Instructions" shall mean: (i) a tested telex, a written (including,
without limitation, facsimile transmission) request, direction,
instruction or certification signed or initialed by or on behalf of
the applicable Fund by one or more Authorized Persons (as hereinafter
defined); (ii) a telephonic or other oral communication by one or more
Authorized Persons; or (iii) a communication effected directly between
an electro-mechanical or electronic device or system (including,
without limitation, computers) by or on behalf of the applicable Fund
by one or more Authorized Persons; provided, however, that
communications of the types described in clauses (ii) and (iii) above
purporting to be given by an Authorized Person shall be considered
Proper Instructions only if the Custodian reasonably believes such
communications to have been given by an Authorized Person with respect
to the transaction involved. Proper Instructions in the form of oral
communications shall be confirmed by the applicable Fund by tested
telex or in writing in the manner set forth in clause (i) above, but
the lack of such confirmation shall in no way affect any action taken
by the Custodian in reliance upon such oral instructions prior to the
Custodian's receipt of such confirmation. Each Fund and the Custodian
are hereby authorized to record any and all telephonic or other oral
instructions communicated to the Custodian. Proper Instructions may
relate to specific transactions or to types or classes of
transactions, and may be in the form of standing instructions.
(b) Special Instructions. As used herein, the term "Special
Instructions" shall mean Proper Instructions countersigned or
confirmed in writing by the Treasurer or any Assistant Treasurer of
the applicable Fund or any other person designated by the Treasurer of
such Fund in writing, which countersignature or confirmation shall be
(i) included on the same instrument containing the Proper Instructions
or on a separate instrument relating thereto, and (ii) delivered by
hand, by facsimile transmission, or in such other manner as the
applicable Fund and the Custodian agree in writing.
(c) Address for Proper Instructions and Special Instructions. Proper
Instructions and Special Instructions shall be delivered to the
Custodian at the address and/or telephone, telecopy or telex number
agreed upon from time to time by the Custodian and the applicable
Fund.
Section 3.02. Authorized Persons. Concurrently with the execution
of this Agreement and from time to time thereafter, as appropriate,
each Fund shall deliver to the Custodian, duly certified as
appropriate by a Treasurer or Assistant Treasurer of such Fund, a
certificate setting forth: (a) the names, titles, signatures and
scope of authority of all persons authorized to give Proper
Instructions or any other notice, request, direction, instruction,
certificate or instrument on behalf of such Fund (collectively, the
"Authorized Persons" and individually, an "Authorized Person"); and
(b) the names, titles and signatures of those persons authorized to
issue Special Instructions. Such certificate may be accepted and
relied upon by the Custodian as conclusive evidence of the facts set
forth therein and shall be considered to be in full force and effect
until delivery to the Custodian of a similar certificate to the
contrary. Upon delivery of a certificate which deletes the name(s) of
a person previously authorized by a Fund to give Proper Instructions
or to issue Special Instructions, such persons shall no longer be
considered an Authorized Person or authorized to issue Special
Instructions for that Fund.
Section 3.03. Persons Having Access to Assets of the Portfolios.
Notwithstanding anything to the contrary contained in this Agreement,
no Authorized Person, Trustee, officer, employee or agent of any Fund
shall have physical access to the assets of any Portfolio of that Fund
held by the Custodian nor shall the Custodian deliver any assets of a
Portfolio for delivery to an account of such person; provided,
however, that nothing in this Section 3.03 shall prohibit (a) any
Authorized Person from giving Proper Instructions, or any person
authorized to issue Special Instructions from issuing Special
Instructions, so long as such action does not result in delivery of or
access to assets of any Portfolio prohibited by this Section 3.03; or
(b) each Fund's independent certified public accountants from
examining or reviewing the assets of the Portfolios of the Fund held
by the Custodian. Each Fund shall deliver to the Custodian a written
certificate identifying such Authorized Persons, Trustees, officers,
employees and agents of such Fund.
Section 3.04. Actions of Custodian Based on Proper Instructions and
Special Instructions. So long as and to the extent that the Custodian
acts in accordance with (a) Proper Instructions or Special
Instructions, as the case may be, and (b) the terms of this Agreement,
the Custodian shall not be responsible for the title, validity or
genuineness of any property, or evidence of title thereof, received by
it or delivered by it pursuant to this Agreement.
ARTICLE IV
SUBCUSTODIANS
The Custodian may, from time to time, in accordance with the relevant
provisions of this Article IV, appoint one or more Domestic
Subcustodians, Foreign Subcustodians, Interim Subcustodians and
Special Subcustodians to act on behalf of a Portfolio. (For purposes
of this Agreement, all duly appointed Domestic Subcustodians, Foreign
Subcustodians, Interim Subcustodians, and Special Subcustodians are
hereinafter referred to collectively, as "Subcustodians.")
Section 4.01. Domestic Subcustodians. The Custodian may, at any
time and from time to time, appoint any bank as defined in Section
2(a)(5) of the 1940 Act meeting the requirements of a custodian under
Section 17(f) of the 1940 Act and the rules and regulations
thereunder, to act on behalf of one or more Portfolios as a
subcustodian for purposes of holding cash, securities and other assets
of such Portfolios and performing other functions of the Custodian
within the United States (a "Domestic Subcustodian"); provided, that,
the Custodian shall notify each applicable Fund in writing of the
identity and qualifications of any proposed Domestic Subcustodian at
least thirty (30) days prior to appointment of such Domestic
Subcustodian, and such Fund may, in its sole discretion, by written
notice to the Custodian executed by an Authorized Person disapprove of
the appointment of such Domestic Subcustodian. If, following notice
by the Custodian to each applicable Fund regarding appointment of a
Domestic Subcustodian and the expiration of thirty (30) days after the
date of such notice, such Fund shall have failed to notify the
Custodian of its disapproval thereof, the Custodian may, in its
discretion, appoint such proposed Domestic Subcustodian as its
subcustodian.
Section 4.02. Foreign Subcustodians and Interim Subcustodians.
(a) Foreign Subcustodians. The Custodian may, at any time and from
time to time, appoint: (i) any bank, trust company or other entity
meeting the requirements of an "eligible foreign custodian" under
Section 17(f) of the 1940 Act and the rules and regulations thereunder
or by order of the Securities and Exchange Commission exempted
therefrom, or (ii) any bank as defined in Section 2(a)(5) of the 1940
Act meeting the requirements of a custodian under Section 17(f) of the
1940 Act and the rules and regulations thereunder to act on behalf of
one or more Portfolios as a subcustodian for purposes of holding cash,
securities and other assets of such Portfolios and performing other
functions of the Custodian in countries other than the United States
of America (a "Foreign Subcustodian"); provided, that, prior to the
appointment of any Foreign Subcustodian, the Custodian shall have
obtained written confirmation of the approval of the Board of Trustees
or other governing body or entity of each applicable Fund on behalf of
its applicable Portfolio(s) (which approval may be withheld in the
sole discretion of such Board of Trustees or other governing body or
entity) with respect to (i) the identity and qualifications of any
proposed Foreign Subcustodian, (ii) the country or countries in which,
and the securities depositories or clearing agencies, if any, through
which, any proposed Foreign Subcustodian is authorized to hold
securities and other assets of the applicable Portfolio(s), and (iii)
the form and terms of the subcustodian agreement to be entered into
between such proposed Foreign Subcustodian and the Custodian. Each
such duly approved Foreign Subcustodian and the countries where and
the securities depositories and clearing agencies through which they
may hold securities and other assets of the applicable Portfolios
shall be listed on Appendix "B" attached hereto, as it may be amended,
from time to time, in accordance with the provisions of Section
9.06(c) hereof. Each Fund shall be responsible for informing the
Custodian sufficiently in advance of a proposed investment by one of
its Portfolios which is to be held in a country in which no Foreign
Subcustodian is authorized to act, in order that there shall be
sufficient time for the Custodian to effect the appropriate
arrangements with a proposed foreign subcustodian, including obtaining
approval as provided in this Section 4.02(a). The Custodian shall not
amend any subcustodian agreement entered into with a Foreign
Subcustodian, or agree to change or permit any changes thereunder, or
waive any rights under such agreement, which materially affect a
Fund's rights or the Foreign Subcustodian's obligations or duties to
a Fund under such agreement, except upon prior approval pursuant to
Special Instructions.
(b) Interim Subcustodians. Notwithstanding the foregoing, in the
event that a Portfolio shall invest in a security or other asset to be
held in a country in which no Foreign Subcustodian is authorized to
act, the Custodian shall promptly notify the applicable Fund in
writing by facsimile transmission or in such other manner as such Fund
and Custodian shall agree in writing of the unavailability of an
approved Foreign Subcustodian in such country; and the Custodian
shall, upon receipt of Special Instructions, appoint any Person
designated by the applicable Fund in such Special Instructions to hold
such security or other asset. (Any Person appointed as a subcustodian
pursuant to this Section 4.02(b) is hereinafter referred to as an
"Interim Subcustodian.")
Section 4.03. Special Subcustodians. Upon receipt of Special
Instructions, the Custodian shall, on behalf of one or more
Portfolios, appoint one or more banks, trust companies or other
entities designated in such Special Instructions to act as a
subcustodian for purposes of: (i) effecting third-party repurchase
transactions with banks, brokers, dealers or other entities through
the use of a common custodian or subcustodian; (ii) establishing a
joint trading account for the applicable Portfolio(s) and other
registered open-end management investment companies for which Fidelity
Management & Research Company serves as investment adviser, through
which such Portfolios and such other investment companies shall
collectively participate in certain repurchase transactions; (iii)
providing depository and clearing agency services with respect to
certain variable rate demand note securities; and (iv) effecting any
other transactions designated by each applicable Fund in Special
Instructions. (Each such designated subcustodian is hereinafter
referred to as a "Special Subcustodian.") Each such duly appointed
Special Subcustodian shall be listed on Appendix "B" attached hereto,
as it may be amended from time to time in accordance with the
provisions of Section 9.06(c) hereof. In connection with the
appointment of any Special Subcustodian, the Custodian shall enter
into a subcustodian agreement with the Special Subcustodian in form
and substance approved by each applicable Fund, provided that such
agreement shall in all events comply with the provisions of the 1940
Act and the rules and regulations thereunder and the terms and
provisions of this Agreement. The Custodian shall not amend any
subcustodian agreement entered into with a Special Subcustodian, or
agree to change or permit any changes thereunder, or waive any rights
under such agreement, except upon prior approval pursuant to Special
Instructions.
Section 4.04. Termination of a Subcustodian. The Custodian shall
(i) cause each Domestic Subcustodian and Foreign Subcustodian to, and
(ii) use its best efforts to cause each Interim Subcustodian and
Special Subcustodian to, perform all of its obligations in accordance
with the terms and conditions of the subcustodian agreement between
the Custodian and such Subcustodian. In the event that the Custodian
is unable to cause such Subcustodian to fully perform its obligations
thereunder, the Custodian shall forthwith, upon the receipt of Special
Instructions, terminate such Subcustodian with respect to each
applicable Fund and, if necessary or desirable, appoint a replacement
Subcustodian in accordance with the provisions of Section 4.01 or
Section 4.02, as the case may be. In addition to the foregoing, the
Custodian (A) may, at any time in its discretion, upon written
notification to each applicable Fund, terminate any Domestic
Subcustodian, Foreign Subcustodian or Interim Subcustodian, and (B)
shall, upon receipt of Special Instructions, terminate any
Subcustodian with respect to each applicable Fund, in accordance with
the termination provisions under the applicable subcustodian
agreement.
Section 4.05. Certification Regarding Foreign Subcustodians. Upon
request of a Fund, the Custodian shall deliver to such Fund a
certificate stating: (i) the identity of each Foreign Subcustodian
then acting on behalf of the Custodian for such Fund and its
Portfolios; (ii) the countries in which and the securities
depositories and clearing agents through which each such Foreign
Subcustodian is then holding cash, securities and other assets of any
Portfolio of such Fund; and (iii) such other information as may be
requested by such Fund to ensure compliance with Rule 17(f)-5 under
the 1940 Act.
ARTICLE V
STANDARD OF CARE; INDEMNIFICATION
Section 5.01. Standard of Care.
(a) General Standard of Care. The Custodian shall exercise
reasonable care and diligence in carrying out all of its duties and
obligations under this Agreement, and shall be liable to each Fund for
all loss, damage and expense suffered or incurred by such Fund or its
Portfolios resulting from the failure of the Custodian to exercise
such reasonable care and diligence.
(b) Actions Prohibited by Applicable Law, Etc. In no event shall the
Custodian incur liability hereunder if the Custodian or any
Subcustodian or Securities System, or any subcustodian, securities
depository or securities system utilized by any such Subcustodian, or
any nominee of the Custodian or any Subcustodian (individually, a
"Person") is prevented, forbidden or delayed from performing, or omits
to perform, any act or thing which this Agreement provides shall be
performed or omitted to be performed, by reason of: (i) any provision
of any present or future law or regulation or order of the United
States of America, or any state thereof, or of any foreign country, or
political subdivision thereof or of any court of competent
jurisdiction; or (ii) any act of God or war or other similar
circumstance beyond the control of the Custodian, unless, in each
case, such delay or nonperformance is caused by (A) the negligence,
misfeasance or misconduct of the applicable Person, or (B) a
malfunction or failure of equipment operated or utilized by the
applicable Person other than a malfunction or failure beyond such
Person's control and which could not reasonably be anticipated and/or
prevented by such Person.
(c) Mitigation by Custodian. Upon the occurrence of any event which
causes or may cause any loss, damage or expense to any Fund or
Portfolio, (i) the Custodian shall, (ii) the Custodian shall cause any
applicable Domestic Subcustodian or Foreign Subcustodian to, and (iii)
the Custodian shall use its best efforts to cause any applicable
Interim Subcustodian or Special Subcustodian to, use all commercially
reasonable efforts and take all reasonable steps under the
circumstances to mitigate the effects of such event and to avoid
continuing harm to the Funds and the Portfolios.
(d) Advice of Counsel. The Custodian shall be entitled to receive
and act upon advice of counsel on all matters. The Custodian shall be
without liability for any action reasonably taken or omitted in good
faith pursuant to the advice of (i) counsel for the applicable Fund or
Funds, or (ii) at the expense of the Custodian, such other counsel as
the applicable Fund(s) and the Custodian may agree upon; provided,
however, with respect to the performance of any action or omission of
any action upon such advice, the Custodian shall be required to
conform to the standard of care set forth in Section 5.01(a).
(e) Expenses of the Funds. In addition to the liability of the
Custodian under this Article V, the Custodian shall be liable to each
applicable Fund for all reasonable costs and expenses incurred by such
Fund in connection with any claim by such Fund against the Custodian
arising from the obligations of the Custodian hereunder, including,
without limitation, all reasonable attorneys' fees and expenses
incurred by such Fund in asserting any such claim, and all expenses
incurred by such Fund in connection with any investigations, lawsuits
or proceedings relating to such claim; provided, that such Fund has
recovered from the Custodian for such claim.
(f) Liability for Past Records. The Custodian shall have no
liability in respect of any loss, damage or expense suffered by a
Fund, insofar as such loss, damage or expense arises from the
performance of the Custodian's duties hereunder by reason of the
Custodian's reliance upon records that were maintained for such Fund
by entities other than the Custodian prior to the Custodian's
appointment as custodian for such Fund.
Section 5.02. Liability of Custodian for Actions of Other Persons.
(a) Domestic Subcustodians and Foreign Subcustodians. The Custodian
shall be liable for the actions or omissions of any Domestic
Subcustodian or any Foreign Subcustodian to the same extent as if such
action or omission were performed by the Custodian itself. In the
event of any loss, damage or expense suffered or incurred by a Fund
caused by or resulting from the actions or omissions of any Domestic
Subcustodian or Foreign Subcustodian for which the Custodian would
otherwise be liable, the Custodian shall promptly reimburse such Fund
in the amount of any such loss, damage or expense.
(b) Interim Subcustodians. Notwithstanding the provisions of Section
5.01 to the contrary, the Custodian shall not be liable to a Fund for
any loss, damage or expense suffered or incurred by such Fund or any
of its Portfolios resulting from the actions or omissions of an
Interim Subcustodian unless such loss, damage or expense is caused by,
or results from, the negligence, misfeasance or misconduct of the
Custodian; provided, however, in the event of any such loss, damage or
expense, the Custodian shall take all reasonable steps to enforce such
rights as it may have against such Interim Subcustodian to protect the
interests of the Funds and the Portfolios.
(c) Special Subcustodians and Additional Custodians. Notwithstanding
the provisions of Section 5.01 to the contrary and except as otherwise
provided in any subcustodian or custodian agreement to which the
Custodian, a Fund and any Special Subcustodian or Additional Custodian
are parties, the Custodian shall not be liable to a Fund for any loss,
damage or expense suffered or incurred by such Fund or any of its
Portfolios resulting from the actions or omissions of a Special
Subcustodian or Additional Custodian, unless such loss, damage or
expense is caused by, or results from, the negligence, misfeasance or
misconduct of the Custodian; provided, however, that in the event of
any such loss, damage or expense, the Custodian shall take all
reasonable steps to enforce such rights as it may have against any
Special Subcustodian or Additional Custodian to protect the interests
of the Funds and the Portfolios.
(d) Securities Systems. Notwithstanding the provisions of Section
5.01 to the contrary, the Custodian shall not be liable to a Fund for
any loss, damage or expense suffered or incurred by such Fund or any
of its Portfolios resulting from the use by the Custodian of a
Securities System, unless such loss, damage or expense is caused by,
or results from, the negligence, misfeasance or misconduct of the
Custodian; provided, however, that in the event of any such loss,
damage or expense, the Custodian shall take all reasonable steps to
enforce such rights as it may have against the Securities System to
protect the interests of the Funds and the Portfolios.
(e) Reimbursement of Expenses. Each Fund agrees to reimburse the
Custodian for all reasonable out-of-pocket expenses incurred by the
Custodian on behalf of such Fund in connection with the fulfillment of
its obligations under this Section 5.02; provided, however, that such
reimbursement shall not apply to expenses occasioned by or resulting
from the negligence, misfeasance or misconduct of the Custodian.
Section 5.03. Indemnification.
(a) Indemnification Obligations. Subject to the limitations set
forth in this Agreement, each Fund severally and not jointly agrees to
indemnify and hold harmless the Custodian and its nominees from all
loss, damage and expense (including reasonable attorneys' fees)
suffered or incurred by the Custodian or its nominee caused by or
arising from actions taken by the Custodian on behalf of such Fund in
the performance of its duties and obligations under this Agreement;
provided, however, that such indemnity shall not apply to loss, damage
and expense occasioned by or resulting from the negligence,
misfeasance or misconduct of the Custodian or its nominee. In
addition, each Fund agrees severally and not jointly to indemnify any
Person against any liability incurred by reason of taxes assessed to
such Person, or other loss, damage or expenses incurred by such
Person, resulting from the fact that securities and other property of
such Fund's Portfolios are registered in the name of such Person;
provided, however, that in no event shall such indemnification be
applicable to income, franchise or similar taxes which may be imposed
or assessed against any Person.
(b) Notice of Litigation, Right to Prosecute, Etc. No Fund shall be
liable for indemnification under this Section 5.03 unless a Person
shall have promptly notified such Fund in writing of the commencement
of any litigation or proceeding brought against such Person in respect
of which indemnity may be sought under this Section 5.03. With
respect to claims in such litigation or proceedings for which
indemnity by a Fund may be sought and subject to applicable law and
the ruling of any court of competent jurisdiction, such Fund shall be
entitled to participate in any such litigation or proceeding and,
after written notice from such Fund to any Person, such Fund may
assume the defense of such litigation or proceeding with counsel of
its choice at its own expense in respect of that portion of the
litigation for which such Fund may be subject to an indemnification
obligation; provided, however, a Person shall be entitled to
participate in (but not control) at its own cost and expense, the
defense of any such litigation or proceeding if such Fund has not
acknowledged in writing its obligation to indemnify the Person with
respect to such litigation or proceeding. If such Fund is not
permitted to participate or control such litigation or proceeding
under applicable law or by a ruling of a court of competent
jurisdiction, such Person shall reasonably prosecute such litigation
or proceeding. A Person shall not consent to the entry of any
judgment or enter into any settlement in any such litigation or
proceeding without providing each applicable Fund with adequate notice
of any such settlement or judgment, and without each such Fund's prior
written consent. All Persons shall submit written evidence to each
applicable Fund with respect to any cost or expense for which they are
seeking indemnification in such form and detail as such Fund may
reasonably request.
Section 5.04. Investment Limitations. If the Custodian has
otherwise complied with the terms and conditions of this Agreement in
performing its duties generally, and more particularly in connection
with the purchase, sale or exchange of securities made by or for a
Portfolio, the Custodian shall not be liable to the applicable Fund
and such Fund agrees to indemnify the Custodian and its nominees, for
any loss, damage or expense suffered or incurred by the Custodian and
its nominees arising out of any violation of any investment or other
limitation to which such Fund is subject.
Section 5.05. Fund's Right to Proceed. Notwithstanding anything to
the contrary contained herein, each Fund shall have, at its election
upon reasonable notice to the Custodian, the right to enforce, to the
extent permitted by any applicable agreement and applicable law, the
Custodian's rights against any Subcustodian, Securities System, or
other Person for loss, damage or expense caused such Fund by such
Subcustodian, Securities System, or other Person, and shall be
entitled to enforce the rights of the Custodian with respect to any
claim against such Subcustodian, Securities System or other Person,
which the Custodian may have as a consequence of any such loss, damage
or expense, if and to the extent that such Fund has not been made
whole for any such loss or damage. If the Custodian makes such Fund
whole for any such loss or damage, the Custodian shall retain the
ability to enforce its rights directly against such Subcustodian,
Securities System or other Person. Upon such Fund's election to
enforce any rights of the Custodian under this Section 5.05, such Fund
shall reasonably prosecute all actions and proceedings directly
relating to the rights of the Custodian in respect of the loss, damage
or expense incurred by such Fund; provided that, so long as such Fund
has acknowledged in writing its obligation to indemnify the Custodian
under Section 5.03 hereof with respect to such claim, such Fund shall
retain the right to settle, compromise and/or terminate any action or
proceeding in respect of the loss, damage or expense incurred by such
Fund without the Custodian's consent and provided further, that if
such Fund has not made an acknowledgement of its obligation to
indemnify, such Fund shall not settle, compromise or terminate any
such action or proceeding without the written consent of the
Custodian, which consent shall not be unreasonably withheld or
delayed. The Custodian agrees to cooperate with each Fund and take
all actions reasonably requested by such Fund in connection with such
Fund's enforcement of any rights of the Custodian. Each Fund agrees
to reimburse the Custodian for all reasonable out-of-pocket expenses
incurred by the Custodian on behalf of such Fund in connection with
the fulfillment of its obligations under this Section 5.05; provided,
however, that such reimbursement shall not apply to expenses
occasioned by or resulting from the negligence, misfeasance or
misconduct of the Custodian.
ARTICLE VI
COMPENSATION
On behalf of each of its Portfolios, each Fund shall compensate the
Custodian in an amount, and at such times, as may be agreed upon in
writing, from time to time, by the Custodian and such Fund.
ARTICLE VII
TERMINATION
Section 7.01. Termination of Agreement as to One or More Funds.
With respect to each Fund, this Agreement shall continue in full force
and effect until the first to occur of: (a) termination by the
Custodian by an instrument in writing delivered or mailed to such
Fund, such termination to take effect not sooner than ninety (90) days
after the date of such delivery; (b) termination by such Fund by an
instrument in writing delivered or mailed to the Custodian, such
termination to take effect not sooner than thirty (30) days after the
date of such delivery; or (c) termination by such Fund by written
notice delivered to the Custodian, based upon such Fund's
determination that there is a reasonable basis to conclude that the
Custodian is insolvent or that the financial condition of the
Custodian is deteriorating in any material respect, in which case
termination shall take effect upon the Custodian's receipt of such
notice or at such later time as such Fund shall designate. In the
event of termination pursuant to this Section 7.01 by any Fund (a
"Terminating Fund"), each Terminating Fund shall make payment of all
accrued fees and unreimbursed expenses with respect to such
Terminating Fund within a reasonable time following termination and
delivery of a statement to the Terminating Fund setting forth such
fees and expenses. Each Terminating Fund shall identify in any notice
of termination a successor custodian or custodians to which the cash,
securities and other assets of its Portfolios shall, upon termination
of this Agreement with respect to such Terminating Fund, be delivered.
In the event that no written notice designating a successor custodian
shall have been delivered to the Custodian on or before the date when
termination of this Agreement as to a Terminating Fund shall become
effective, the Custodian may deliver to a bank or trust company doing
business in Boston, Massachusetts, of its own selection, having an
aggregate capital, surplus, and undivided profits, as shown by its
last published report, of not less than $25,000,000, all securities
and other assets of such Terminating Fund's Portfolios held by the
Custodian and all instruments held by the Custodian relative thereto
and all other property of the Terminating Fund's Portfolios held by
the Custodian under this Agreement. Thereafter, such bank or trust
company shall be the successor of the Custodian with respect to such
Terminating Fund under this Agreement. In the event that securities
and other assets of such Terminating Fund's Portfolios remain in the
possession of the Custodian after the date of termination hereof with
respect to such Terminating Fund owing to failure of the Terminating
Fund to appoint a successor custodian, the Custodian shall be entitled
to compensation for its services in accordance with the fee schedule
most recently in effect, for such period as the Custodian retains
possession of such securities and other assets, and the provisions of
this Agreement relating to the duties and obligations of the Custodian
and the Terminating Fund shall remain in full force and effect. In
the event of the appointment of a successor custodian, it is agreed
that the cash, securities and other property owned by a Terminating
Fund and held by the Custodian, any Subcustodian or nominee shall be
delivered to the successor custodian; and the Custodian agrees to
cooperate with such Terminating Fund in the execution of documents and
performance of other actions necessary or desirable in order to
substitute the successor custodian for the Custodian under this
Agreement.
Section 7.02. Termination as to One or More Portfolios. This
Agreement may be terminated as to one or more of a Fund's Portfolios
(but less than all of its Portfolios) by delivery of an amended
Appendix "A" deleting such Portfolios pursuant to Section 9.06(b)
hereof, in which case termination as to such deleted Portfolios shall
take effect thirty (30) days after the date of such delivery. The
execution and delivery of an amended Appendix "A" which deletes one or
more Portfolios shall constitute a termination of this Agreement only
with respect to such deleted Portfolio(s), shall be governed by the
preceding provisions of Section 7.01 as to the identification of a
successor custodian and the delivery of cash, securities and other
assets of the Portfolio(s) so deleted, and shall not affect the
obligations of the Custodian and any Fund hereunder with respect to
the other Portfolios set forth in Appendix "A," as amended from time
to time.
ARTICLE VIII
DEFINED TERMS
The following terms are defined in the following sections:
Term Section
Account 2.22
ADRs 2.06
Additional Custodian 2.23(a)
Authorized Person(s) 3.02
Banking Institution 2.12
Business Day Appendix "C"
Bank Accounts 2.21
Distribution Account 2.16
Domestic Subcustodian 4.01
Foreign Subcustodian 4.02(a)
Fund Preamble
Institutional Client 2.03
Interim Subcustodian 4.02(b)
Overdraft 2.28
Overdraft Notice 2.28
Person 5.01(b)
Portfolio Preamble
Procedural Agreement 2.10
Proper Instructions 3.01(a)
SEC 2.22
Securities System 2.22
Shares 2.16
Special Instructions 3.01(b)
Special Subcustodian 4.03
Subcustodian Article IV
Terminating Fund 7.01
1940 Act Preamble
ARTICLE IX
MISCELLANEOUS
Section 9.01. Execution of Documents, Etc.
(a) Actions by each Fund. Upon request, each Fund shall execute and
deliver to the Custodian such proxies, powers of attorney or other
instruments as may be reasonable and necessary or desirable in
connection with the performance by the Custodian or any Subcustodian
of their respective obligations to such Fund under this Agreement or
any applicable subcustodian agreement with respect to such Fund,
provided that the exercise by the Custodian or any Subcustodian of any
such rights shall in all events be in compliance with the terms of
this Agreement.
(b) Actions by Custodian. Upon receipt of Proper Instructions, the
Custodian shall execute and deliver to each applicable Fund or to such
other parties as such Fund(s) may designate in such Proper
Instructions, all such documents, instruments or agreements as may be
reasonable and necessary or desirable in order to effectuate any of
the transactions contemplated hereby.
Section 9.02. Representative Capacity; Nonrecourse Obligations. A
COPY OF THE DECLARATION OF TRUST OR OTHER ORGANIZATIONAL DOCUMENT OF
EACH FUND IS ON FILE WITH THE SECRETARY OF THE STATE OF THE FUND'S
FORMATION, AND NOTICE IS HEREBY GIVEN THAT THIS AGREEMENT IS NOT
EXECUTED ON BEHALF OF THE TRUSTEES OF ANY FUND AS INDIVIDUALS, AND THE
OBLIGATIONS OF THIS AGREEMENT ARE NOT BINDING UPON ANY OF THE
TRUSTEES, OFFICERS, SHAREHOLDERS OR PARTNERS OF ANY FUND INDIVIDUALLY,
BUT ARE BINDING ONLY UPON THE ASSETS AND PROPERTY OF EACH FUND'S
RESPECTIVE PORTFOLIOS. THE CUSTODIAN AGREES THAT NO SHAREHOLDER,
TRUSTEE, OFFICER OR PARTNER OF ANY FUND MAY BE HELD PERSONALLY LIABLE
OR RESPONSIBLE FOR ANY OBLIGATIONS OF ANY FUND ARISING OUT OF THIS
AGREEMENT.
Section 9.03. Several Obligations of the Funds and the Portfolios.
WITH RESPECT TO ANY OBLIGATIONS OF A FUND ON BEHALF OF ANY OF ITS
PORTFOLIOS ARISING OUT OF THIS AGREEMENT, INCLUDING, WITHOUT
LIMITATION, THE OBLIGATIONS ARISING UNDER SECTIONS 2.28, 5.03, 5.05
and ARTICLE VI HEREOF, THE CUSTODIAN SHALL LOOK FOR PAYMENT OR
SATISFACTION OF ANY OBLIGATION SOLELY TO THE ASSETS AND PROPERTY OF
THE PORTFOLIO TO WHICH SUCH OBLIGATION RELATES AS THOUGH EACH FUND HAD
SEPARATELY CONTRACTED WITH THE CUSTODIAN BY SEPARATE WRITTEN
INSTRUMENT WITH RESPECT TO EACH OF ITS PORTFOLIOS.
Section 9.04. Representations and Warranties.
(a) Representations and Warranties of Each Fund. Each Fund hereby
severally and not jointly represents and warrants that each of the
following shall be true, correct and complete with respect to each
Fund at all times during the term of this Agreement: (i) the Fund is
duly organized under the laws of its jurisdiction of organization and
is registered as an open-end management investment company under the
1940 Act; and (ii) the execution, delivery and performance by the Fund
of this Agreement are (w) within its power, (x) have been duly
authorized by all necessary action, and (y) will not (A) contribute to
or result in a breach of or default under or conflict with any
existing law, order, regulation or ruling of any governmental or
regulatory agency or authority, or (B) violate any provision of the
Fund's corporate charter, Declaration of Trust or other organizational
document, or bylaws, or any amendment thereof or any provision of its
most recent Prospectus or Statement of Additional Information.
(b) Representations and Warranties of the Custodian. The Custodian
hereby represents and warrants to each Fund that each of the following
shall be true, correct and complete at all times during the term of
this Agreement: (i) the Custodian is duly organized under the laws of
its jurisdiction of organization and qualifies to act as a custodian
to open-end management investment companies under the provisions of
the 1940 Act; and (ii) the execution, delivery and performance by the
Custodian of this Agreement are (w) within its power, (x) have been
duly authorized by all necessary action, and (y) will not (A)
contribute to or result in a breach of or default under or conflict
with any existing law, order, regulation or ruling of any governmental
or regulatory agency or authority, or (B) violate any provision of the
Custodian's corporate charter, or other organizational document, or
bylaws, or any amendment thereof.
Section 9.05. Entire Agreement. This Agreement constitutes the
entire understanding and agreement of the Fund, on the one hand, and
the Custodian, on the other, with respect to the subject matter hereof
and accordingly, supersedes as of the effective date of this Agreement
any custodian agreement heretofore in effect between each Fund and the
Custodian.
Section 9.06. Waivers and Amendments. No provision of this
Agreement may be waived, amended or terminated except by a statement
in writing signed by the party against which enforcement of such
waiver, amendment or termination is sought; provided, however: (a)
Appendix "A" listing the Portfolios of each Fund for which the
Custodian serves as custodian may be amended from time to time to add
one or more Portfolios for one or more Funds, by each applicable
Fund's execution and delivery to the Custodian of an amended Appendix
"A", and the execution of such amended Appendix by the Custodian, in
which case such amendment shall take effect immediately upon execution
by the Custodian; (b) Appendix "A" may be amended from time to time to
delete one or more Portfolios (but less than all of the Portfolios) of
one or more of the Funds, by each applicable Fund's execution and
delivery to the Custodian of an amended Appendix "A", in which case
such amendment shall take effect thirty (30) days after such delivery,
unless otherwise agreed by the Custodian and each applicable Fund in
writing; (c) Appendix "B" listing Foreign Subcustodians, Special
Subcustodians and Additional Custodians approved by any Fund may be
amended from time to time to add or delete one or more Foreign
Subcustodians or Special Subcustodians for a Fund or Funds by each
applicable Fund's execution and delivery to the Custodian of an
amended Appendix "B", in which case such amendment shall take effect
immediately upon execution by the Custodian; and (d) Appendix "C"
setting forth the procedures relating to the Custodian's security
interest with respect to each Fund may be amended only by an
instrument in writing executed by each applicable Fund and the
Custodian.
Section 9.07. Interpretation. In connection with the operation of
this Agreement, the Custodian and any Fund may agree in writing from
time to time on such provisions interpretative of or in addition to
the provisions of this Agreement with respect to such Fund as may in
their joint opinion be consistent with the general tenor of this
Agreement. No interpretative or additional provisions made as
provided in the preceding sentence shall be deemed to be an amendment
of this Agreement or affect any other Fund.
Section 9.08. Captions. Headings contained in this Agreement, which
are included as convenient references only, shall have no bearing upon
the interpretation of the terms of the Agreement or the obligations of
the parties hereto.
Section 9.09. Governing Law. Insofar as any question or dispute may
arise in connection with the custodianship of foreign securities
pursuant to an agreement with a Foreign Subcustodian that is governed
by the laws of the State of New York, the provisions of this Agreement
shall be construed in accordance with and governed by the laws of the
State of New York, provided that in all other instances this Agreement
shall be construed in accordance with and governed by the laws of the
Commonwealth of Massachusetts, in each case without giving effect to
principles of conflicts of law.
Section 9.10. Notices. Except in the case of Proper Instructions or
Special Instructions, notices and other writings contemplated by this
Agreement shall be delivered by hand or by facsimile transmission
(provided that in the case of delivery by facsimile transmission,
notice shall also be mailed postage prepaid to the parties at the
following addresses:
(a) If to any Fund:
c/o Fidelity Management & Research Company
82 Devonshire Street
Boston, Massachusetts 02109
Attn: Treasurer of the Fidelity Funds
Telephone: (617) 563-3565
Telefax: (617) 476-4195
(b) If to the Custodian:
State Street Bank and Trust Company
1776 Heritage Drive
North Quincy, MA 02171-2197
Attn: Abigail C. Raymond
Telephone: (617) 985-6606
Telefax: (617) 985-0280
or to such other address as a Fund or the Custodian may have
designated in writing to the other.
Section 9.11. Assignment. This Agreement shall be binding on and
shall inure to the benefit of each Fund severally and the Custodian
and their respective successors and assigns, provided that, subject to
the provisions of Section 7.01 hereof, neither the Custodian nor any
Fund may assign this Agreement or any of its rights or obligations
hereunder without the prior written consent of the other party.
Section 9.12. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original.
With respect to each Fund, this Agreement shall become effective when
one or more counterparts have been signed and delivered by such Fund
and the Custodian.
Section 9.13. Confidentiality; Survival of Obligations. The parties
hereto agree that each shall treat confidentially the terms and
conditions of this Agreement and all information provided by each
party to the other regarding its business and operations. All
confidential information provided by a party hereto shall be used by
any other party hereto solely for the purpose of rendering services
pursuant to this Agreement and, except as may be required in carrying
out this Agreement, shall not be disclosed to any third party without
the prior consent of such providing party. The foregoing shall not be
applicable to any information that is publicly available when provided
or thereafter becomes publicly available other than through a breach
of this Agreement, or that is required to be disclosed by any bank
examiner of the Custodian or any Subcustodian, any auditor of the
parties hereto, by judicial or administrative process or otherwise by
applicable law or regulation. The provisions of this Section 9.13 and
Sections 9.01, 9.02, 9.03, 9.09, Section 2.28, Section 3.04, Section
7.01, Article V and Article VI hereof and any other rights or
obligations incurred or accrued by any party hereto prior to
termination of this Agreement shall survive any termination of this
Agreement.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be executed in its name and behalf on the day and year first above
written.
Each of the Investment Companies Listed on State Street Bank and Trust
Company
Appendix "A" Attached Hereto, on Behalf
of each of Their Respective Portfolios
[Signature Lines Omitted]
FORM OF
APPENDIX "B"
TO
CUSTODIAN AGREEMENT
BETWEEN
State Street Bank and Trust Company and Each of the Investment
Companies Listed on Appendix A
Dated as of
The following is a list of Additional Custodians, Special
Subcustodians and Foreign Subcustodians under the Custodian Agreement
dated as of February 1, 1996 (the "Custodian Agreement"):
A. Additional Custodians:
Custodian Purpose
Bank of New York Ficash
Fiterm
B. Special Subcustodians:
Subcustodian Purpose
Bank of New York Ficash
C. Foreign Subcustodians:
Country Subcustodian Depository
Argentina Citibank, N.A., Buenos Aires Caja de Valores S.A.
Australia Westpac Banking Corporation, Austraclear Limited
Sydney
Reserve Bank Information
and Transfer System (RITS)
Austria GiroCredit Bank Oesterreichische Kontrollbank
AG der Sparkassen, Vienna AG (Wertpapiersammelbank
Division)
Bahrain The British Bank of the None
Middle East, Manama
Bangladesh Standard Chartered Bank,
Dhaka None
Belgium Generale Bank, Brussels Caisse Interprofessionnelle
de Depots et de Virements de
Titres S.A. (CIK)
Belgium Banque Nationale de Belgique
Bermuda The Bank of Bermuda Limited None
Bostwana Barclays Bank of Bostwana None
Limited, Gaborone
Brazil Citibank, N.A., Sao Paulo Bolsa de Valores de Sao Paulo
(Bovespa); Banco Central do
Brasil, Systema
Especial de Liquidacao e
Custodia (SELIC);
Rio de Janeiro Stock Exchange
(BVRJ); Central de Custodia e
Liquidacao Financeira
de Titulos (CETIP)
Bulgaria ING Bank N.V., Sofia Central Depository AD (CDAD)
The Bulgarian National Bank
Canada Canada Trustco Mortgage Canadian Depository for
Company, Toronto Securities Limited (CDS)
Chile Citibank, N.A., Santiago None
China The Hongkong and Shanghai Shanghai Securities Central
Banking Corporation Limited, Clearing and Registration
Shanghai & Shenzhen branches Corporation (SSCRC);
Shenzhen Securities
Registrars Co.,
Ltd. (SSRC).
Colombia Cititrust Colombia S.A. None
Sociedad Fiduciaria, Bogota
Cyprus Barclays Bank PLC, Nicosia
Czech
Republic Ceskoslovenska Obchodni Stredisko Cennych Papiru
(SCP);
Banka, A.S., Prague Czech National Bank (CNB)
Denmark Den Danske Bank, Copenhagen Vaerdipapericentralen- The
Danish Securities Center (VP)
Ecuador Citibank, N.A., Quito None
Egypt National Bank of Egypt,
Cairo Misr for Clearing, Settlement
and Depository
Finland Merita Bank Limited,
Helsinki The Finnish Central
Securities Depository
Limited (CSD)
France Banque Paribas, Paris Societe Interprofessionnelle
pour la Compensation des
Valeurs Mobilieres (SICOVAM)
Banque de France
Germany Dresdner Bank AG, Frankfurt Deutsche Borse Clearing (DBC)
Ghana Barclays Bank of Ghana
Limited, None
Accra
Greece National Bank of Greece,
S.A., Central Securities Depository,
S.A.
Athens (Apothtirion Tilton A.E.)
The Bank of Greece
Hong Kong Standard Chartered Bank, Hong Kong Securities Clearing
Co. Ltd.,
Hong Kong Central Clearing and
Settlement System
(CCASS)
The Central Money Markets
Unit CMU
Hungary Citibank Budapest Rt., Central Depository and
Clearing House
Budapest (Budapest) Ltd. (KELER Ltd.)
India Deutsche Bank AG, Mumbai; National Securities Depository
Limited
Hongkong & Shanghai Banking (NSDL)
Corporation, Ltd., Mumbai
Indonesia Standard Chartered Bank, None
Jakarta
Ireland Bank of Ireland, Dublin Gilt Settlement Office (GSO)
Israel Bank Hapoalim B.M.,
Tel Aviv Tel Aviv Stock Exchange (TASE)
Clearinghouse, Ltd
The Bank of Israel
Italy Banque Paribas, Milan Monte Titoli S.p.A.;
Banca d'Italia
Ivory
Coast Societe Generale de Banques None
en Cote d'Ivoire, Abidjan
Japan Sumitomo Trust & Banking Japan Securities Depository
Center
Co., Ltd., Osaka; (JASDEC);
Daiwa Bank, Ltd., Tokyo; Bank of Japan
Fuji Bank, Ltd., Tokyo
Jordan British Bank of the Middle None
East, Amman
Kenya Barclays Bank of Kenya
Limited, None
Nairobi
Lebanon The British Bank of the
Middle Midclear
East, Beirut Central Bank of Lebanon
Malaysia Standard Chartered Bank Malaysia Central Depository
Sdn.
Malaysia Berhad, Kuala
Lampur bhd. (MCD)
Bank Negara Malasia
Mauritius Hongkong and Shanghai Central Depository &
Settlement Co., Ltd.
Banking Corporation
Limited,
Port Louis
Mexico Citibank Mexico, S.A., S.D. INDEVAL, S.A. de C.V.
Mexico City (Institucion para el Deposito
de Valores)
Morocco Banque Commerciale du
Maroc, None
Casablanca
Netherlands MeesPierson N.V.,
Amesterdam Nederlands Centraal Instituut
voor Giraal Effectenverkeer
B.V.
(NECIGEF), KAS Associatie,
N.V. (KAS)
De Nederlandshe Bank
New Zealand ANZ Banking Group
(New New Zealand Securities
Zealand) Limited,
Wellington Depository Limited (NZCDS)
Norway Christiania Bank og
Kreditkasse, Verdipapirsentralen (VPS)
Oslo
Oman British Bank of the
Middle East, Muscat Securities Market
Muscat
Pakistan Deutsche Bank AG, Karachi The Central Depository Company
of Pakistan
Peru Citibank, N.A., Lima Caja de Valores (CAVAL)
Philippines Standard Chartered Bank, The Philippines Central
Depository, Inc.
Manila
The Book-Entry-System of the
Central Bank
The Registry of Scripless
Securities of the Bureau
of the Treasury,
Department of Finance
Poland Citibank Poland, S.A.,
Warsaw National Depository of
Securities; National Bank
of Poland
Portugal Banco Comercial
Portuguese, S.A., Central de Valores Mobiliarios
Lisbon (Interbolsa)
Romania ING Bank N.V., Bucharest National Company for Clearing,
Settlement & Depository for
Securities (SNCDD)
Romania Bucharest Stock Exchange (BSE)
Russia Credit Suisse First
Boston, AO None
Moscow
Singapore The Development Bank of Central Depository (Pte) Ltd.
(CDP)
Singapore Ltd., Singapore
Slovak
Republic Ceskoslovenska Obchodna Stredisko Cennych Papierov
(SCP)
Banka A.S., Bratislava National Bank of Slovakia
(NBS)
Slovenia Banka Creditanstalt
d.d., Ljubljana, Klirinsko Depotna Druzba
a 99.96% owned subsidiary
of Creditanstalt AG
South Africa Standard Bank of South
Africa The Central Depository (Pty)
Ltd. (CD)
Limited, Johannesburg
South Korea The Hongkong and Shanghai Korean Securities
Depositories (KSD)
Banking Corporation,
Limited
Seoul
Spain Banco Santander, S.A., Servicio de Compensacion y
Madrid Liquidacion de Valores
(SCLV);
Banco de Espana
Sri Lanka Hongkong and Shanghai Central Depository System
(Pvt)
Banking Corp. Ltd.,
Colombo Limited (CDS)
Swaziland Standard Bank Swaziland, None
Limited, Mbabane
Sweden Skandinaviska Enskilda
Banken, Vardepapperscentralen AB
Stockholm
The Swedish Central
Securities Depository
Switzerland Union Bank of Switzerland, Schweizerische Effekten-Giro
AG
Zurich (SEGA)
Taiwan Central Trust of China, Taiwan Securities Central
Taipei Depository Company (TSCD)
Thailand Standard Chartered Bank, Thailand Securities
Depository
Bangkok Company Limited (TSD)
Transnational Cedel Bank Societe Anonyme
INTERSETTLE
The Euroclear System
Turkey Citibank, N.A., Istanbul Istanbul Stock Exchange
Settlement and
Custody Co., Inc. (I.M.K.B.
Takas ve Saklama A.S.);
Central Bank of Turkey
United Kingdom State Street Bank and
Trust Central Gilts Office (CGO);
Company, London Central Moneymarkets Office
State Street London
Limited, (CMO); European Settlement
Office (ESO)
London
Uruguay Citibank, N.A., Montevideo None
Venezuela Citibank, N.A., Caracas None
Zambia Barclays Bank of Zambia Lusaka Central Depository
(LCD)
Limited, Lusaka (overseen by Lusaka Stock
Exchange)
Each of the Investment Companies Listed on
Appendix A to the Custodian Agreement, on
Behalf of Each of Their Respective Portfolios
[Signature Lines Omitted]
form of
Appendix "C" to the
Custodian Agreement
Between
Each of the Investment Companies
Listed on Appendix "A" Thereto
And
State Street Bank and Trust Company
Dated as of___________
PROCEDURES RELATING TO CUSTODIAN'S SECURITY INTEREST
As security for any Overdrafts (as defined in the Custodian
Agreement) of any Portfolio, the applicable Fund, on behalf of such
Portfolio, shall pledge, assign and grant to the Custodian a security
interest in Collateral (as hereinafter defined), under the terms,
circumstances and conditions set forth in this Appendix "C".
Section 1. Defined Terms. As used in this Appendix "C" the
following terms shall have the following respective meanings:
(a) "Business Day" shall mean any day that is not a Saturday, a
Sunday or a day on which the Custodian is closed for business.
(b) "Collateral" shall mean, with respect to any Portfolio,
securities held by the Custodian on behalf of the Portfolio having a
fair market value (as determined in accordance with the procedures set
forth in the prospectus for the Portfolio) equal to the aggregate of
all Overdraft Obligations of such Portfolio: (i) identified in any
Pledge Certificate executed on behalf of such Portfolio; or (ii)
designated by the Custodian for such Portfolio pursuant to Section 3
of this Appendix C. Such securities shall consist of marketable
securities held by the Custodian on behalf of such Portfolio or, if no
such marketable securities are held by the Custodian on behalf of such
Portfolio, such other securities designated by the applicable Fund in
the applicable Pledge Certificate or by the Custodian pursuant to
Section 3 of this Appendix C.
(c) "Overdraft Obligations" shall mean, with respect to any
Portfolio, the amount of any outstanding Overdraft(s) provided by the
Custodian to such Portfolio together with all accrued interest
thereon.
(d) "Pledge Certificate" shall mean a Pledge Certificate in the form
attached to this Appendix "C" as Schedule 1 executed by a duly
authorized officer of the applicable Fund and delivered by such Fund
to the Custodian by facsimile transmission or in such other manner as
the applicable Fund and the Custodian may agree in writing.
(e) "Release Certificate" shall mean a Release Certificate in the
form attached to this Appendix "C" as Schedule 2 executed by a duly
authorized officer of the Custodian and delivered by the Custodian to
the applicable Fund by facsimile transmission or in such other manner
as such Fund and the Custodian may agree in writing.
(f) "Written Notice" shall mean a written notice executed by a duly
authorized officer of the party delivering the notice and delivered by
facsimile transmission or in such other manner as the applicable Fund
and the Custodian shall agree in writing.
Section 2. Pledge of Collateral. To the extent that any Overdraft
Obligations of a Portfolio are not satisfied by the close of business
on the first Business Day following the Business Day on which the
applicable Fund receives Written Notice requesting security for such
Overdraft Obligation and stating the amount of such Overdraft
Obligation, the applicable Fund, on behalf of such Portfolio, shall
pledge, assign and grant to the Custodian a first priority security
interest, by delivering to the Custodian, a Pledge Certificate
executed by such Fund on behalf of such Portfolio describing the
applicable Collateral. Such Written Notice may, in the discretion of
the Custodian, be included within or accompany the Overdraft Notice
relating to the applicable Overdraft Obligations.
Section 3. Failure to Pledge Collateral. In the event that the
applicable Fund shall fail: (a) to pay, on behalf of the applicable
Portfolio, the Overdraft Obligation described in such Written Notice;
(b) to deliver to the Custodian a Pledge Certificate pursuant to
Section 2; or (c) to identify substitute securities pursuant to
Section 6 upon the sale or maturity of any securities identified as
Collateral, the Custodian may, by Written Notice to the applicable
Fund specify Collateral which shall secure the applicable Overdraft
Obligation. Such Fund, on behalf of any applicable Portfolio, hereby
pledges, assigns and grants to the Custodian a first priority security
interest in any and all Collateral specified in such Written Notice;
provided that such pledge, assignment and grant of security shall be
deemed to be effective only upon receipt by the applicable Fund of
such Written Notice.
Section 4. Delivery of Additional Collateral. If at any time the
Custodian shall notify a Fund by Written Notice that the fair market
value of the Collateral securing any Overdraft Obligation of one of
such Fund's Portfolios is less than the amount of such Overdraft
Obligation, such Fund, on behalf of the applicable Portfolio, shall
deliver to the Custodian, within one (1) Business Day following the
Fund's receipt of such Written Notice, an additional Pledge
Certificate describing additional Collateral. If such Fund shall fail
to deliver such additional Pledge Certificate, the Custodian may
specify Collateral which shall secure the unsecured amount of the
applicable Overdraft Obligation in accordance with Section 3 of this
Appendix C.
Section 5. Release of Collateral. Upon payment by a Fund, on behalf
of one of its Portfolios, of any Overdraft Obligation secured by the
pledge of Collateral, the Custodian shall promptly deliver to such
Fund a Release Certificate pursuant to which the Custodian shall
release Collateral from the lien under the applicable Pledge
Certificate or Written Notice pursuant to Section 3 having a fair
market value equal to the amount paid by such Fund on account of such
Overdraft Obligation. In addition, if at any time a Fund shall notify
the Custodian by Written Notice that such Fund desires that specified
Collateral be released and: (a) that the fair market value of the
Collateral securing any Overdraft Obligation shall exceed the amount
of such Overdraft Obligation; or (b) that the Fund has delivered a
Pledge Certificate substituting Collateral for such Overdraft
Obligation, the Custodian shall deliver to such Fund, within one (1)
Business Day following the Custodian's receipt of such Written Notice,
a Release Certificate relating to the Collateral specified in such
Written Notice.
Section 6. Substitution of Collateral. A Fund may substitute
securities for any securities identified as Collateral by delivery to
the Custodian of a Pledge Certificate executed by such Fund on behalf
of the applicable Portfolio, indicating the securities pledged as
Collateral.
Section 7. Security for Individual Portfolios' Overdraft
Obligations. The pledge of Collateral by a Fund on behalf of any of
its individual Portfolios shall secure only the Overdraft Obligations
of such Portfolio. In no event shall the pledge of Collateral by one
of a Fund's Portfolios be deemed or considered to be security for the
Overdraft Obligations of any other Portfolio of such Fund or of any
other Fund.
Section 8. Custodian's Remedies. Upon (a) a Fund's failure to pay
any Overdraft Obligation of an applicable Portfolio within thirty (30)
days after receipt by such Fund of a Written Notice demanding security
therefore, and (b) one (1) Business Day's prior Written Notice to such
Fund, the Custodian may elect to enforce its security interest in the
Collateral securing such Overdraft Obligation, by taking title to (at
the then prevailing fair market value), or selling in a commercially
reasonable manner, so much of the Collateral as shall be required to
pay such Overdraft Obligation in full. Notwithstanding the provisions
of any applicable law, including, without limitation, the Uniform
Commercial Code, the remedy set forth in the preceding sentence shall
be the only right or remedy to which the Custodian is entitled with
respect to the pledge and security interest granted pursuant to any
Pledge Certificate or Section 3. Without limiting the foregoing, the
Custodian hereby waives and relinquishes all contractual and common
law rights of set off to which it may now or hereafter be or become
entitled with respect to any obligations of any Fund to the Custodian
arising under this Appendix "C" to the Agreement.
IN WITNESS WHEREOF, each of the parties has caused this Appendix to
be executed in its name and behalf on the day and year first above
written.
Each of the Investment Companies Listed on State Street Bank and Trust
Company
Schedule A to the Custodian Agreement, on
Behalf of Each of Their Respective Portfolios
[Signature Lines Omitted]
SCHEDULE 1
TO
APPENDIX "C"
PLEDGE CERTIFICATE
This Pledge Certificate is delivered pursuant to the Custodian
Agreement dated as of February 1, 1996 (the "Agreement"), between [
] (the "Fund") and State Street Bank and Trust Company (the
"Custodian"). Capitalized terms used herein without definition shall
have the respective meanings ascribed to them in the Agreement.
Pursuant to [Section 2 or Section 4] of Appendix "C" attached to the
Agreement, the Fund, on behalf of [ ] (the "Portfolio"),
hereby pledges, assigns and grants to the Custodian a first priority
security interest in the securities listed on Exhibit "A" attached to
this Pledge Certificate (collectively, the "Pledged Securities").
Upon delivery of this Pledge Certificate, the Pledged Securities shall
constitute Collateral, and shall secure all Overdraft Obligations of
the Portfolio described in that certain Written Notice dated
, 19 , delivered by the Custodian to the Fund. The pledge,
assignment and grant of security in the Pledged Securities hereunder
shall be subject in all respect to the terms and conditions of the
Agreement, including, without limitation, Sections 7 and 8 of Appendix
"C" attached thereto.
IN WITNESS WHEREOF, the Fund has caused this Pledge Certificate to be
executed in its name, on behalf of the Portfolio this day of
19 .
[FUND], on Behalf of [Portfolio]
By: ___________________
Name: ___________________
Title: ___________________
EXHIBIT "A"
TO
PLEDGE CERTIFICATE
Type of Certificate/CUSIP Number of
Issuer Security Numbers Shares
SCHEDULE 2
TO
APPENDIX "C"
RELEASE CERTIFICATE
This Release Certificate is delivered pursuant to the Custodian
Agreement dated as of
[ ] (the "Agreement"), between [ ] (the "Fund")
and State Street Bank and Trust Company (the "Custodian").
Capitalized terms used herein without definition shall have the
respective meanings ascribed to them in the Agreement. Pursuant to
Section 5 of Appendix "C" attached to the Agreement, the Custodian
hereby releases the securities listed on Exhibit "A" attached to this
Release Certificate from the lien under the [Pledge Certificate dated
, 19 or the Written Notice delivered pursuant to Section 3
of Appendix "C" dated , 19 ].
IN WITNESS WHEREOF, the Custodian has caused this Release Certificate
to be executed in its name and on its behalf this day of 19 .
State Street Bank and Trust Company
[Signature Lines Omitted]
EXHIBIT "A"
TO
RELEASE CERTIFICATE
Type of Certificate/CUSIP Number of
Issuer Security Numbers Shares
KIRKPATRICK & LOCKHART LLP
1800 MASSACHUSETTS AVENUE, N.W.
WASHINGTON, D. C. 20036-1800
TELEPHONE 202-778-9000
August 31, 1998
Fidelity Advisor Series I
82 Devonshire Street
Boston, Massachusetts 02109
Ladies and Gentlemen:
You have requested our opinion, as counsel to Fidelity Advisor Series
I ("the Trust"), as to certain matters regarding the issuance of
Shares of the Trust. As used in this letter, the term "Shares" means
the Class A, Class T, Class B, Class C and Institutional Class shares
of beneficial interest of Fidelity Advisor Small Cap Fund, a series of
the Trust.
As such counsel, we have examined certified or other copies, believed
by us to be genuine, of the Trust's Declaration of Trust and by-laws
and such resolutions and minutes of meetings of the Trust's Board of
Trustees as we have deemed relevant to our opinion, as set forth
herein. Our opinion is limited to the laws and facts in existence on
the date hereof, and it is further limited to the laws (other than the
conflict of law rules) in the Commonwealth of Massachusetts that in
our experience are normally applicable to the issuance of shares by
unincorporated voluntary associations and to the Securities Act of
1933 ("1933 Act"), the Investment Company Act of 1940 ("1940 Act") and
the regulations of the Securities and Exchange Commission ("SEC")
thereunder.
Based on present laws and facts, we are of the opinion that the
issuance of the Shares has been duly authorized by the Trust and that,
when sold in accordance with the terms contemplated by the
Post-Effective Amendment No. 45 to the Trust's Registration Statement
on Form N-1A ("PEA"), including receipt by the Trust of full payment
for the Shares and compliance with the 1933 Act and the 1940 Act, the
Shares will have been validly issued, fully paid and non-assessable.
We note, however, that the Trust is an entity of the type commonly
known as a "Massachusetts business trust." Under Massachusetts law,
shareholders could, under certain circumstances, be held personally
liable for the obligations of the Trust. The Declaration of Trust
states that all persons extending credit to, contracting with or
having any claim against the Trust or the Trustees shall look only to
the assets of the Trust for payment under such credit, contract or
claim; and neither the Shareholders nor the Trustees, nor any of their
agents, whether past, present or future, shall be personally liable
therefor. It also requires that every note, bond, contract or other
undertaking issued by or on behalf of the Trust or the Trustees
relating to the Trust shall include a recitation limiting the
obligation represented thereby to the Trust and its assets. The
Declaration of Trust further provides: (1) for indemnification from
the assets of the Trust for all loss and expense of any shareholder
held personally liable for the obligations of the Trust by virtue of
ownership of shares of the Trust; and (2) for the Trust to assume the
defense of any claim against the shareholder for any act or obligation
of the Trust. Thus, the risk of a shareholder incurring financial loss
on account of shareholder liability is limited to circumstances in
which the Trust or series would be unable to meet its obligations.
We hereby consent to this opinion accompanying the PEA when it is
filed with the SEC and to the reference to our firm in the PEA.
Very truly yours,
KIRKPATRICK & LOCKHART LLP
By __/s/ Robert C. Hacker____________________
Robert C. Hacker
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the reference to our Firm under the heading
"Auditor" in the Statement of Additional Information of Fidelity
Advisor Series I: Fidelity Advisor Small Cap Fund which is included in
Post-Effective Amendment No. 45 to the Registration Statement on Form
N-1A.
/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts
August 31, 1998
DISTRIBUTION AND SERVICE PLAN
FIDELITY ADVISOR SMALL CAP FUND
Class A Shares
1. This Distribution and Service Plan (the "Plan"), when effective in
accordance with its terms, shall be the written plan contemplated by
Rule 12b-1 under the Investment Company Act of 1940, as amended (the
"Act") for the Class A shares of Fidelity Advisor Small Cap Fund
("Class A") a class of shares of Fidelity Advisor Small Cap Fund (the
"Fund"), a portfolio of Fidelity Advisor Series I (the "Trust").
2. The Trust has entered into a General Distribution Agreement on
behalf of the Fund with Fidelity Distributors Corporation (the
"Distributor"), under which the Distributor uses all reasonable
efforts, consistent with its other business, to secure purchasers of
the Fund's shares of beneficial interest (the "Shares"). Such efforts
may include, but neither are required to include nor are limited to,
the following: (1) formulation and implementation of marketing and
promotional activities, such as mail promotions and television, radio,
newspaper, magazine and other mass media advertising; (2) preparation,
printing and distribution of sales literature; (3) preparation,
printing and distribution of prospectuses of the Fund and reports to
recipients other than the existing shareholders of the Fund; (4)
obtaining such information, analyses and reports with respect to
marketing and promotional activities as the Distributor may, from time
to time, deem advisable; (5) making payments to securities dealers and
others engaged in the sale of Shares or who engage in shareholder
support services; and (6) providing training, marketing and support to
such dealers with respect to the sale of Shares.
3. In consideration for the services provided and the expenses
incurred by the Distributor pursuant to the General Distribution
Agreement and paragraph 2 hereof, all with respect to Class A Shares,
Class A shall pay to the Distributor a fee at the annual rate of 0.75%
(or such lesser amount as the Trustees may, from time to time,
determine) of the average daily net assets of Class A throughout the
month. The determination of daily net assets shall be made at the
close of business each day throughout the month and computed in the
manner specified in the Fund's then current Prospectus for the
determination of the net asset value of the Fund's Class A Shares.
The Distributor may use all or any portion of the fee received
pursuant to this Plan to compensate securities dealers or other
persons who have engaged in the sale of Class A Shares or in
shareholder support services pursuant to agreements with the
Distributor, or to pay any of the expenses associated with other
activities authorized under paragraph 2 hereof.
4. The Fund presently pays, and will continue to pay, a management
fee to Fidelity Management & Research Company (the "Adviser") pursuant
to a management agreement between the Fund and the Adviser (the
"Management Contract"). It is recognized that the Adviser may use its
management fee revenue, as well as its past profits or its resources
from any other source, to make payment to the Distributor with respect
to any expenses incurred in connection with the distribution of Class
A Shares, including the activities referred to in paragraph 2 hereof.
To the extent that the payment of management fees by the Fund to the
Adviser should be deemed to be indirect financing of any activity
primarily intended to result in the sale of Class A Shares within the
meaning of Rule 12b-1, then such payment shall be deemed to be
authorized by this Plan.
5. This Plan shall become effective upon the approval by a vote of a
majority of the Trustees of the Trust, including a majority of
Trustees who are not "interested persons" of the Trust (as defined in
the Act) and who have no direct or indirect financial interest in the
operation of this Plan or in any agreement related to the Plan (the
"Independent Trustees"), cast in person at a meeting called for the
purpose of voting on this Plan.
6. This Plan shall, unless terminated as hereinafter provided, remain
in effect until April 30, 1999, and from year to year thereafter;
provided, however, that such continuance is subject to approval
annually by a vote of a majority of the Trustees of the Trust,
including a majority of the Independent Trustees, cast in person at a
meeting called for the purpose of voting on this Plan. This Plan may
be amended at any time by the Board of Trustees, provided that (a) any
amendment to increase materially the fee provided for in paragraph 3
hereof or any amendment of the Management Contract to increase the
amount to be paid by the Fund thereunder shall be effective only upon
approval by a vote of a majority of the outstanding voting securities
of Class A, in the case of this Plan, or upon approval by a vote of a
majority of the outstanding voting securities of the Fund, in the case
of the Management Contract, and (b) any material amendment of this
Plan shall be effective only upon approval in the manner provided in
the first sentence of this paragraph 6.
7. This Plan may be terminated at any time, without the payment of
any penalty, by vote of a majority of the Independent Trustees or by a
vote of a majority of the outstanding voting securities of Class A.
8. During the existence of this Plan, the Trust shall require the
Adviser and/or the Distributor to provide the Trust, for review by the
Trustees, and the Trustees shall review, at least quarterly, a written
report of the amounts expended in connection with financing any
activity primarily intended to result in the sale of shares of Class A
(making estimates of such costs where necessary or desirable) and the
purposes for which such expenditures were made.
9. This Plan does not require the Adviser or Distributor to perform
any specific type or level of distribution activities or to incur any
specific level of expenses for activities primarily intended to result
in the sale of Class A Shares.
10. Consistent with the limitation of shareholder liability as set
forth in the Trust's Declaration of Trust, obligation assumed by Class
A pursuant to this Plan and any agreement related to this Plan shall
be limited in all cases to Class A and its assets and shall not
constitute an obligation of any shareholder of the Trust or of any
other class of the Fund, series of the Trust or class of such series.
11. If any provision of the Plan shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Plan
shall not be affected thereby.
DISTRIBUTION AND SERVICE PLAN
FIDELITY ADVISOR SMALL CAP FUND
Class T Shares
1. This Distribution and Service Plan (the "Plan"), when effective in
accordance with its terms, shall be the written plan contemplated by
Rule 12b-1 under the Investment Company Act of 1940, as amended (the
"Act") for the Class T shares of Fidelity Advisor Small Cap Fund
("Class T"), a class of shares of Fidelity Advisor Small Cap Fund (the
"Fund"), a portfolio of Fidelity Advisor Series I (the "Trust").
2. The Trust has entered into a General Distribution Agreement on
behalf of the Fund with Fidelity Distributors Corporation (the
"Distributor"), under which the Distributor uses all reasonable
efforts, consistent with its other business, to secure purchasers of
the Fund's shares of beneficial interest (the "Shares"). Such efforts
may include, but neither are required to include nor are limited to,
the following: (1) formulation and implementation of marketing and
promotional activities, such as mail promotions and television, radio,
newspaper, magazine and other mass media advertising; (2) preparation,
printing and distribution of sales literature; (3) preparation,
printing and distribution of prospectuses of the Fund and reports to
recipients other than the existing shareholders of the Fund; (4)
obtaining such information, analyses and reports with respect to
marketing and promotional activities as the Distributor may, from time
to time, deem advisable; (5) making payments to securities dealers and
others engaged in the sale of Shares or who engage in shareholder
support services; and (6) providing training, marketing and support to
such dealers with respect to the sale of Shares.
3. In consideration for the services provided and the expenses
incurred by the Distributor pursuant to the General Distribution
Agreement and paragraph 2 hereof, all with respect to Class T Shares,
Class T shall pay to the Distributor a fee at the annual rate of 0.75%
(or such lesser amount as the Trustees may, from time to time,
determine) of the average daily net assets of Class T throughout the
month. The determination of daily net assets shall be made at the
close of business each day throughout the month and computed in the
manner specified in the Fund's then current Prospectus for the
determination of the net asset value of the Fund's Class T Shares.
The Distributor may use all or any portion of the fee received
pursuant to this Plan to compensate securities dealers or other
persons who have engaged in the sale of Class T Shares or in
shareholder support services pursuant to agreements with the
Distributor, or to pay any of the expenses associated with other
activities authorized under paragraph 2 hereof.
4. The Fund presently pays, and will continue to pay, a management
fee to Fidelity Management & Research Company (the "Adviser") pursuant
to a management agreement between the Fund and the Adviser (the
"Management Contract"). It is recognized that the Adviser may use its
management fee revenue, as well as its past profits or its resources
from any other source, to make payment to the Distributor with respect
to any expenses incurred in connection with the distribution of Class
T Shares, including the activities referred to in paragraph 2 hereof.
To the extent that the payment of management fees by the Fund to the
Adviser should be deemed to be indirect financing of any activity
primarily intended to result in the sale of Class T Shares within the
meaning of Rule 12b-1, then such payment shall be deemed to be
authorized by this Plan.
5. This Plan shall become effective upon the approval by a vote of a
majority of the Trustees of the Trust, including a majority of
Trustees who are not "interested persons" of the Trust (as defined in
the Act) and who have no direct or indirect financial interest in the
operation of this Plan or in any agreement related to the Plan (the
"Independent Trustees"), cast in person at a meeting called for the
purpose of voting on this Plan.
6. This Plan shall, unless terminated as hereinafter provided, remain
in effect until April 30, 1999, and from year to year thereafter;
provided, however, that such continuance is subject to approval
annually by a vote of a majority of the Trustees of the Trust,
including a majority of the Independent Trustees, cast in person at a
meeting called for the purpose of voting on this Plan. This Plan may
be amended at any time by the Board of Trustees, provided that (a) any
amendment to increase materially the fee provided for in paragraph 3
hereof or any amendment of the Management Contract to increase the
amount to be paid by the Fund thereunder shall be effective only upon
approval by a vote of a majority of the outstanding voting securities
of Class T, in the case of this Plan, or upon approval by a vote of a
majority of the outstanding voting securities of the Fund, in the case
of the Management Contract, and (b) any material amendment of this
Plan shall be effective only upon approval in the manner provided in
the first sentence of this paragraph 6.
7. This Plan may be terminated at any time, without the payment of
any penalty, by vote of a majority of the Independent Trustees or by a
vote of a majority of the outstanding voting securities of Class T.
8. During the existence of this Plan, the Trust shall require the
Adviser and/or the Distributor to provide the Trust, for review by the
Trustees, and the Trustees shall review, at least quarterly, a written
report of the amounts expended in connection with financing any
activity primarily intended to result in the sale of shares of Class T
(making estimates of such costs where necessary or desirable) and the
purposes for which such expenditures were made.
9. This Plan does not require the Adviser or Distributor to perform
any specific type or level of distribution activities or to incur any
specific level of expenses for activities primarily intended to result
in the sale of Class T Shares.
10. Consistent with the limitation of shareholder liability as set
forth in the Trust's Declaration of Trust, obligation assumed by Class
T pursuant to this Plan and any agreement related to this Plan shall
be limited in all cases to Class T and its assets and shall not
constitute an obligation of any shareholder of the Trust or of any
other class of the Fund, series of the Trust or class of such series.
11. If any provision of the Plan shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Plan
shall not be affected thereby.
DISTRIBUTION AND SERVICE PLAN
FIDELITY ADVISOR SMALL CAP FUND
Class B Shares
1. This Distribution and Service Plan (the "Plan"), when effective
in accordance with its terms, shall be the written plan contemplated
by Rule 12b-1 under the Investment Company Act of 1940, as amended
(the "Act") for Class B shares of Fidelity Advisor Small Cap Fund
("Class B"), a class of shares of Fidelity Advisor Small Cap Fund (the
"Fund"), a series of Fidelity Advisor Series I (the "Trust").
2. The Trust has entered into a General Distribution Agreement on
behalf of the Fund with Fidelity Distributors Corporation (the
"Distributor") under which the Distributor uses all reasonable
efforts, consistent with its other business, to secure purchasers of
the Fund's shares of beneficial interest (the "Shares"). Such efforts
may include, but neither are required to include nor are limited to,
the following: (1) formulation and implementation of marketing and
promotional activities, such as mail promotions and television, radio,
newspaper, magazine and other mass media advertising; (2) preparation,
printing and distribution of sales literature; (3) preparation,
printing and distribution of prospectuses of the Fund and reports to
recipients other than existing shareholders of the Fund; (4) obtaining
such information, analyses and reports with respect to marketing and
promotional activities as the Distributor may, from time to time, deem
advisable; (5) making payments to securities dealers and others
engaged in the sale of Shares or in shareholder support services
("Investment Professionals"); and (6) providing training, marketing
and support to Investment Professionals with respect to the sale of
Shares.
3. In accordance with such terms as the Trustees may, from time to
time establish, and in conjunction with its services under the General
Distribution Agreement with respect to Class B Shares, the Distributor
is hereby expressly authorized to make payments to Investment
Professionals in connection with the sale of Class B Shares. Such
payments may be paid as a percentage of the dollar amount of purchases
of Class B Shares attributable to a particular Investment
Professional, or may take such other form as may be approved by the
Trustees.
4. In consideration of the services provided and the expenses
incurred by the Distributor pursuant to the General Distribution
Agreement and paragraphs 2 and 3 hereof, all with respect to Class B
Shares:
(a) Class B shall pay to the Distributor a monthly distribution fee
at the annual rate of 0.75% (or such lesser amount as the Trustees
may, from time to time, determine) of the average daily net assets of
Class B throughout the month. The determination of daily net assets
shall be made at the close of business each day throughout the month
and computed in the manner specified in the Fund's then current
Prospectus for the determination of the net asset value of Class B
Shares, but shall exclude assets attributable to any other class of
Shares of the Fund. The Distributor may, but shall not be required
to, use all or any portion of the distribution fee received pursuant
to the Plan to compensate Investment Professionals who have engaged in
the sale of Class B Shares or in shareholder support services with
respect to Class B Shares pursuant to agreements with the Distributor,
or to pay any of the expenses associated with other activities
authorized under paragraphs 2 and 3 hereof; and
(b) In addition, the Plan recognizes that the Distributor may, in
accordance with such terms as the Trustees may from time to time
establish, receive all or a portion of any sales charges, including
contingent deferred sales charges, which may be imposed upon the sale
or redemption of Class B Shares.
5. Separate from any payments made as described in paragraph 4
hereof, Class B shall also pay to the Distributor a service fee at the
annual rate of 0.25% (or such lesser amount as the Trustees may, from
time to time, determine) of the average daily net assets of Class B
throughout the month. The determination of daily net assets shall be
made at the close of business each day throughout the month and
computed in the manner specified in the Fund's then current Prospectus
for the determination of the net asset value of Class B Shares, but
shall exclude assets attributable to any other class of Shares of the
Fund. In accordance with such terms as the Trustees may from time to
time establish, the Distributor may use all or a portion of such
service fees to compensate Investment Professionals for personal
service and/or the maintenance of shareholder accounts, or for other
services for which "service fees" lawfully may be paid in accordance
with applicable rules and regulations.
6. The Fund presently pays, and will continue to pay, a management
fee to Fidelity Management & Research Company (the "Adviser") pursuant
to a management agreement between the Fund and the Adviser (the
"Management Contract"). It is recognized that the Adviser may use its
management fee revenue, as well as its past profits or its resources
from any other source, to make payment to the Distributor with respect
to any expenses incurred in connection with the distribution of Class
B Shares, including the activities referred to in paragraphs 2 and 3
hereof. To the extent that the payment of management fees by the Fund
to the Adviser should be deemed to be indirect financing of any
activity primarily intended to result in the sale of Class B Shares
within the meaning of Rule 12b-1, then such payment shall be deemed to
be authorized by this Plan.
7. This Plan shall become effective upon the approval by a vote of a
majority of the Trustees of the Trust, including a majority of
Trustees who are not "interested persons" of the Trust (as defined in
the Act) and who have no direct or indirect financial interest in the
operation of the Plan or in any agreement related to the Plan (the
"Independent Trustees"), cast in person at a meeting called for the
purpose of voting on this Plan.
8. This Plan shall, unless terminated as hereinafter provided,
remain in effect until April 30, 1999, and from year to year
thereafter; provided, however, that such continuance is subject to
approval annually by a vote of a majority of the Trustees of the
Trust, including a majority of the Independent Trustees, cast in
person at a meeting called for the purpose of voting on this Plan.
This Plan may be amended at any time by the Board of Trustees,
provided that (a) any amendment to increase materially the fees
provided for in paragraphs 4 and 5 hereof or any amendment of the
Management Contract to increase the amount to be paid by the Fund
thereunder shall be effective only upon approval by a vote of a
majority of the outstanding voting securities of Class B, in the case
of this Plan, or upon approval by a vote of the majority of the
outstanding voting securities of the Fund, in the case of the
Management Contract, and (b) any material amendment of this Plan shall
be effective only upon approval in the manner provided in the first
sentence of this paragraph 8.
9. This Plan may be terminated at any time, without the payment of
any penalty, by vote of a majority of the Independent Trustees or by a
vote of a majority of the outstanding voting securities of Class B.
10. During the existence of this Plan, the Trust shall require the
Adviser and/or the Distributor to provide the Trust, for review by the
Trustees, and the Trustees shall review, at least quarterly, a written
report of the amounts expended in connection with financing any
activity primarily intended to result in the sale of Class B Shares
(making estimates of such costs where necessary or desirable) and the
purposes for which such expenditures were made.
11. This Plan does not require the Adviser or Distributor to perform
any specific type or level of distribution activities or to incur any
specific level of expenses for activities primarily intended to result
in the sale of Class B Shares.
12. Consistent with the limitation of shareholder liability as set
forth in the Trust's Declaration of Trust, any obligation assumed by
Class B pursuant to this Plan and any agreement related to this Plan
shall be limited in all cases to Class B and its assets and shall not
constitute an obligation of any shareholder of the Trust or of any
other class of the Fund, series of the Trust or class of such series.
13. If any provision of this Plan shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Plan
shall not be affected thereby.
DISTRIBUTION AND SERVICE PLAN
FIDELITY ADVISOR SMALL CAP FUND
Class C Shares
1. This Distribution and Service Plan (the "Plan"), when effective
in accordance with its terms, shall be the written plan contemplated
by Rule 12b-1 under the Investment Company Act of 1940, as amended
(the "Act"), for Class C Shares of Fidelity Advisor Small Cap Fund
("Class C"), a class of shares of Fidelity Advisor Small Cap Fund (the
"Fund"), a series of Fidelity Advisor Series I (the "Trust").
2. The Trust has entered into a General Distribution Agreement on
behalf of the Fund with Fidelity Distributors Corporation (the
"Distributor") under which the Distributor uses all reasonable
efforts, consistent with its other business, to secure purchasers of
the Fund's shares of beneficial interest (the "Shares"). Such efforts
may include, but neither are required to include nor are limited to,
the following: (1) formulation and implementation of marketing and
promotional activities, such as mail promotions and television, radio,
newspaper, magazine and other mass media advertising; (2) preparation,
printing and distribution of sales literature; (3) preparation,
printing and distribution of prospectuses of the Fund and reports to
recipients other than existing shareholders of the Fund; (4) obtaining
such information, analyses and reports with respect to marketing and
promotional activities as the Distributor may, from time to time, deem
advisable; (5) making payments to securities dealers and others
engaged in the sale of Shares or in shareholder support services
("Investment Professionals"); and (6) providing training, marketing
and support to Investment Professionals with respect to the sale of
Shares.
3. In accordance with such terms as the Trustees may, from time to
time establish, and in conjunction with its services under the General
Distribution Agreement with respect to Class C Shares, the Distributor
is hereby expressly authorized to make payments to Investment
Professionals in connection with the sale of Class C Shares. Such
payments may be paid as a percentage of the dollar amount of purchases
of Class C Shares attributable to a particular Investment
Professional, or may take such other form as may be approved by the
Trustees.
4. In consideration of the services provided and the expenses
incurred by the Distributor pursuant to the General Distribution
Agreement and paragraphs 2 and 3 hereof, all with respect to Class C
Shares:
(a) Class C shall pay to the Distributor a monthly distribution fee
at the annual rate of 0.75% (or such lesser amount as the Trustees
may, from time to time, determine) of the average daily net assets of
Class C throughout the month. The determination of daily net assets
shall be made at the close of business each day throughout the month
and computed in the manner specified in the Fund's then current
Prospectus for the determination of the net asset value of Class C
Shares, but shall exclude assets attributable to any other class of
Shares of the Fund. The Distributor may, but shall not be required
to, use all or any portion of the distribution fee received pursuant
to the Plan to compensate Investment Professionals who have engaged in
the sale of Class C Shares or in shareholder support services with
respect to Class C Shares pursuant to agreements with the Distributor,
or to pay any of the expenses associated with other activities
authorized under paragraphs 2 and 3 hereof; and
(b) In addition, the Plan recognizes that the Distributor may, in
accordance with such terms as the Trustees may from time to time
establish, receive all or a portion of any sales charges, including
contingent deferred sales charges, which may be imposed upon the sale
or redemption of Class C Shares.
5. Separate from any payments made as described in paragraph 4
hereof, Class C shall also pay to the Distributor a service fee at the
annual rate of 0.25% (or such lesser amount as the Trustees may, from
time to time, determine) of the average daily net assets of Class C
throughout the month. The determination of daily net assets shall be
made at the close of business each day throughout the month and
computed in the manner specified in the Fund's then current Prospectus
for the determination of the net asset value of Class C Shares, but
shall exclude assets attributable to any other class of Shares of the
Fund. In accordance with such terms as the Trustees may from time to
time establish, the Distributor may use all or a portion of such
service fees to compensate Investment Professionals for personal
service and/or the maintenance of shareholder accounts, or for other
services for which "service fees" lawfully may be paid in accordance
with applicable rules and regulations.
6. The Fund presently pays, and will continue to pay, a management
fee to Fidelity Management & Research Company (the "Adviser") pursuant
to a management agreement between the Fund and the Adviser (the
"Management Contract"). It is recognized that the Adviser may use its
management fee revenue, as well as its past profits or its resources
from any other source, to make payment to the Distributor with respect
to any expenses incurred in connection with the distribution of Class
C Shares, including the activities referred to in paragraphs 2 and 3
hereof. To the extent that the payment of management fees by the Fund
to the Adviser should be deemed to be indirect financing of any
activity primarily intended to result in the sale of Class C Shares
within the meaning of Rule 12b-1, then such payment shall be deemed to
be authorized by this Plan.
7. This Plan shall become effective upon approval by a vote of a
majority of the Trustees of the Trust, including a majority of
Trustees who are not "interested persons" of the Trust (as defined in
the Act) and who have no direct or indirect financial interest in the
operation of the Plan or in any agreement related to the Plan (the
"Independent Trustees"), cast in person at a meeting called for the
purpose of voting on this Plan.
8. This Plan shall, unless terminated as hereinafter provided,
remain in effect until April 30, 1999, and from year to year
thereafter; provided, however, that such continuance is subject to
approval annually by a vote of a majority of the Trustees of the
Trust, including a majority of the Independent Trustees, cast in
person at a meeting called for the purpose of voting on this Plan.
This Plan may be amended at any time by the Board of Trustees,
provided that (a) any amendment to increase materially the fees
provided for in paragraphs 4 and 5 hereof or any amendment of the
Management Contract to increase the amount to be paid by the Fund
thereunder shall be effective only upon approval by a vote of a
majority of the outstanding voting securities of Class C, in the case
of this Plan, or upon approval by a vote of the majority of the
outstanding voting securities of the Fund, in the case of the
Management Contract, and (b) any material amendment of this Plan shall
be effective only upon approval in the manner provided in the first
sentence of this paragraph 8.
9. This Plan may be terminated at any time, without the payment of
any penalty, by vote of a majority of the Independent Trustees or by a
vote of a majority of the outstanding voting securities of Class C.
10. During the existence of this Plan, the Trust shall require the
Adviser and/or the Distributor to provide the Trust, for review by the
Trustees, and the Trustees shall review, at least quarterly, a written
report of the amounts expended in connection with financing any
activity primarily intended to result in the sale of Class C Shares
(making estimates of such costs where necessary or desirable) and the
purposes for which such expenditures were made.
11. This Plan does not require the Adviser or Distributor to perform
any specific type or level of distribution activities or to incur any
specific level of expenses for activities primarily intended to result
in the sale of Class C Shares.
12. Consistent with the limitation of shareholder liability as set
forth in the Trust's Declaration of Trust, any obligation assumed by
Class C pursuant to this Plan and any agreement related to this Plan
shall be limited in all cases to Class C and its assets and shall not
constitute an obligation of any shareholder of the Trust or of any
other class of the Fund, series of the Trust or class of such series.
13. If any provision of this Plan shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Plan
shall not be affected thereby.
DISTRIBUTION AND SERVICE PLAN
FIDELITY ADVISOR SMALL CAP FUND
Institutional Class Shares
1. This Distribution and Service Plan (the "Plan"), when effective in
accordance with its terms, shall be the written plan contemplated by
Rule 12b-1 under the Investment Company Act of 1940, as amended (the
"Act") for Institutional Class Shares of Fidelity Advisor Small Cap
Fund ("Institutional Class"), a class of shares of Fidelity Advisor
Small Cap Fund (the "Fund"), a series of Fidelity Advisor Series I
(the "Trust").
2. The Trust has entered into a General Distribution Agreement on
behalf of the Fund with Fidelity Distributors Corporation (the
"Distributor") under which the Distributor uses all reasonable
efforts, consistent with its other business, to secure purchasers for
the Fund's shares of beneficial interest ("Shares"). Under the
agreement, the Distributor pays the expenses of printing and
distributing any prospectuses, reports and other literature used by
the Distributor, advertising, and other promotional activities in
connection with the offering of Shares of the Fund for sale to the
public. It is recognized that Fidelity Management & Research Company
(the "Adviser") may use its management fee revenues as well as past
profits or its resources from any other source, to make payment to the
Distributor with respect to any expenses incurred in connection with
the distribution of Institutional Class Shares, including the
activities referred to above.
3. The Adviser directly, or through the Distributor, may, subject to
the approval of the Trustees, make payments to securities dealers and
other third parties who engage in the sale of Institutional Class
Shares or who render shareholder support services, including but not
limited to providing office space, equipment and telephone facilities,
answering routine inquiries regarding the Fund, processing shareholder
transactions and providing such other shareholder services as the
Trust may reasonably request.
4. The Institutional Class will not make separate payments as a
result of this Plan to the Adviser, Distributor or any other party, it
being recognized that the Fund presently pays, and will continue to
pay, a management fee to the Adviser. To the extent that any payments
made by the Fund to the Adviser, including payment of management fees,
should be deemed to be indirect financing of any activity primarily
intended to result in the sale of Institutional Class Shares within
the meaning of Rule 12b-1, then such payments shall be deemed to be
authorized by this Plan.
5. This Plan shall become effective upon the approval by a vote of a
majority of the Trustees of the Trust, including a majority of
Trustees who are not "interested persons" of the Trust (as defined in
the Act) and who have no direct or indirect financial interest in the
operation of this Plan or in any agreement related to the Plan (the
"Independent Trustees"), cast in person at a meeting called for the
purpose of voting on this Plan.
6. This Plan shall, unless terminated as hereinafter provided, remain
in effect until April 30, 1999, and from year to year thereafter,
provided, however, that such continuance is subject to approval
annually by a vote of a majority of the Trustees of the Trust,
including a majority of the Independent Trustees, cast in person at a
meeting called for the purpose of voting on this Plan. This Plan may
be amended at any time by the Board of Trustees, provided that (a) any
amendment to authorize direct payments by the Institutional Class to
finance any activity primarily intended to result in the sale of
Institutional Class Shares, to increase materially the amount spent by
the Institutional Class for distribution, or any amendment of the
Management Contract to increase the amount to be paid by the Fund
thereunder shall be effective only upon approval by a vote of a
majority of the outstanding voting securities of the Institutional
Class, in the case of this Plan, or upon approval by a vote of a
majority of the outstanding voting securities of the Fund, in the case
of the Management Contract, and (b) any material amendments of this
Plan shall be effective only upon approval in the manner provided in
the first sentence in this paragraph 6.
7. This Plan may be terminated at any time, without the payment of
any penalty, by vote of a majority of the Independent Trustees or by a
vote of a majority of the outstanding voting securities of the
Institutional Class.
8. During the existence of this Plan, the Trust shall require the
Adviser and/or Distributor to provide the Trust, for review by the
Trustees, and the Trustees shall review, at least quarterly, a written
report of the amounts expended in connection with financing any
activity primarily intended to result in the sale of Institutional
Class Shares (making estimates of such costs where necessary or
desirable) and the purposes for which such expenditures were made.
9. This Plan does not require the Adviser or Distributor to perform
any specific type or level of distribution activities or to incur any
specific level of expenses for activities primarily intended to result
in the sale of Institutional Class Shares.
10. Consistent with the limitation of shareholder liability as set
forth in the Trust's Declaration of Trust, any obligation assumed by
Institutional Class pursuant to this Plan and any agreement related to
this Plan shall be limited in all cases to Institutional Class and its
assets and shall not constitute an obligation of any shareholder of
the Trust or of any other class of the Fund, series of the Trust or
class of such series.
11. If any provision of this Plan shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Plan
shall not be affected thereby.
MULTIPLE CLASS OF SHARES PLAN
FOR
FIDELITY ADVISOR FUNDS
DATED MARCH 19, 1998
This Amended and Restated Multiple Class of Shares Plan (the
"Plan"), when effective in accordance with its provisions, shall be
the written plan contemplated by Rule 18f-3 under the Investment
Company Act of 1940 (the "1940 Act") for the portfolios (each, a
"Fund") of the respective Fidelity Trusts (each, a "Trust") as listed
on Schedule I to this Plan.
1. Classes Offered. Each Fund may offer up to six classes of its
shares: Class A, Class T, Class B, Class C, Institutional Class, and
Initial Class (each, a "Class").
2. Distribution and Shareholder Service Fees. Distribution fees
and/or shareholder service fees shall be calculated and paid in
accordance with the terms of the then-effective plan pursuant to Rule
12b-l under the 1940 Act for the applicable class. Distribution and
shareholder service fees currently authorized are as set forth in
Schedule I to this Plan.
3. Conversion Privilege. After a maximum holding period of seven
years from the initial date of purchase, Class B shares convert
automatically to Class A shares of the same Fund. Simultaneously, a
portion of the Class B shares purchased through the reinvestment of
Class B dividends or capital gains distributions ("Dividend Shares")
will also convert to Class A shares. The portion of Dividend Shares
that will convert at that time is determined by the ratio of
converting Class B non-Dividend Shares held by a shareholder to that
shareholder's total Class B non-Dividend Shares. All conversions
pursuant to this paragraph 3 shall be made on the basis of the
relative net asset values of the two classes, without the imposition
of any sales load, fee, or other charge.
4. Exchange Privileges.
Class A: Shares of Class A may be exchanged for shares of (i) any
other Fidelity Advisor Fund: Class A; (ii) Treasury Fund - Daily Money
Class; (iii) Prime Fund - Daily Money Class; and (iv) Tax-Exempt Fund
- - Daily Money Class.
Class T: Shares of Class T may be exchanged for shares of (i) any
other Fidelity Advisor Fund: Class T; (ii) Treasury Fund - Daily Money
Class; (iii) Prime Fund - Daily Money Class ; and (iv) Tax-Exempt Fund
- - Daily Money Class .
Class B: Shares of Class B may be exchanged for shares of (i) any
other Fidelity Advisor Fund: Class B; and (ii) Treasury Fund - Advisor
B Class.
Class C: Shares of Class C may be exchanged for shares of (i) any
other Fidelity Advisor Fund: Class C; and (ii) Treasury Fund - Advisor
C Class.
Institutional Class: Shares of Institutional Class may be exchanged
for shares of (i) any other Fidelity Advisor Fund: Institutional
Class; and (ii) any Fidelity Retail Fund offering an exchange
privilege to other Fidelity Retail Funds.
Initial Class: Shares of Initial Class may be exchanged for shares of
any Fidelity Retail Fund offering an exchange privilege to other
Fidelity Retail Funds.
5. Allocations. Income, gain, loss and expenses shall be allocated
under this Plan as follows:
A. Class Expenses: The following expenses shall be allocated
exclusively to the applicable specific class of shares: (i)
distribution and shareholder service fees; and (ii) transfer agent
fees.
B. Fund Income, Gain, Loss and Expenses: Income, gain, loss and
expenses not allocated to specific classes as specified above shall be
charged to the Fund and allocated daily to each class of an equity
fund in a manner consistent with Rule 18f-3(c)(1)(i) and of a
fixed-income and money market fund in a manner consistent with Rule
18f-3(c)(1)(iii).
6. Voting Rights. Each class of shares governed by this Plan (i)
shall have exclusive voting rights on any matter submitted to
shareholders that relates solely to its arrangement; and (ii) shall
have separate voting rights on any matter submitted to shareholders in
which the interests of one class differ from the interests of any
other class.
7. Effective Date of Plan. This Plan shall become effective upon
approval by a vote of at least a majority of the Trustees of the
Trust, and a majority of the Trustees of the Trust who are not
"interested persons" of the Trust, which vote shall have found that
this Plan as proposed to be adopted, including expense allocations, is
in the best interests of each class individually and of the Fund as a
whole; or upon such other date as the Trustees shall determine.
8. Amendment of Plan. Any material amendment to this Plan shall
become effective upon approval by a vote of at least a majority of the
Trustees of the Trust, and a majority of the Trustees of the Trust who
are not "interested persons" of the Trust, which vote shall have found
that this Plan as proposed to be amended, including expense
allocations, is in the best interests of each class individually and
of the Fund as a whole; or upon such other date as the Trustees shall
determine.
9. Severability. If any provision of this Plan shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder
of the Plan shall not be affected thereby.
10. Limitation of Liability. Consistent with the limitation of
shareholder liability as set forth in each Trust's Declaration of
Trust or other organizational document, any obligations assumed by any
Fund or class thereof, and any agreements related to this Plan shall
be limited in all cases to the relevant Fund and its assets, or class
and its assets, as the case may be, and shall not constitute
obligations of any other Fund or class of shares. All persons having
any claim against a Fund, or any class thereof, arising in connection
with this Plan, are expressly put on notice of such limitation of
shareholder liability, and agree that any such claim shall be limited
in all cases to the relevant Fund and its assets, or class and its
assets, as the case may be, and such person shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Trust, class or Fund; nor shall such person seek
satisfaction of any such obligation from the Trustees or any
individual Trustee of the Trust.
SCHEDULE I DATED JULY 16, 1998 TO MULTIPLE CLASS OF SHARES PLAN FOR
FIDELITY ADVISOR FUNDS DATED MARCH 19, 1998
<TABLE>
<CAPTION>
<S> <C> <C> <C>
TRUST/FUND/CLASS SALES CHARGE DISTRIBUTION FEE SHAREHOLDER
(AS A PERCENTAGE OF SERVICE FEE
AVERAGE NET ASSETS) (AS A PERCENTAGE OF
AVERAGE NET ASSETS)
Advisor Series VIII
Overseas Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series I
Equity Growth Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series VII
Natural Resources Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series I
Growth Opportunities Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series III
Equity Income Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series II
Balanced Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series I
Large Cap Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series I
Mid Cap Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series I
Small Cap Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series I
Strategic Opportunities Fund:
Initial Class front-end none none
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series VII
Consumer Industries Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series VII
Cyclical Industries Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series VII
Financial Services Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series VII
Health Care Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series VII
Technology Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series VII
Utilities Growth Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series I
TechnoQuant Growth Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series I
Growth & Income Fund:
Class A* front-end 0.25 none
Class T* front-end 0.50 none
Class B contingent deferred 0.75 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series IV
Intermediate Bond Fund:
Class A* front-end 0.15 none
Class T* front-end 0.25 none
Class B contingent deferred 0.65 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series VI
Intermediate Municipal Income Fund:
Class A* front-end 0.15 none
Class T* front-end 0.25 none
Class B contingent deferred 0.65 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series II
Short Fixed-Income Fund:
Class A* front-end 0.15 none
Class T* front-end 0.15 none
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series VI
Short-Intermediate Municipal Income
Fund:
Class A* front-end 0.15 none
Class T* front-end 0.15 none
Institutional Class none none none
Advisor Series VIII
Emerging Markets Income Fund:
Class A* front-end 0.15 none
Class T* front-end 0.25 none
Class B contingent deferred 0.65 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series II
High Yield Fund:
Class A* front-end 0.15 none
Class T* front-end 0.25 none
Class B contingent deferred 0.65 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series II
Strategic Income Fund:
Class A* front-end 0.15 none
Class T* front-end 0.25 none
Class B contingent deferred 0.65 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series II
Government Investment Fund:
Class A* front-end 0.15 none
Class T* front-end 0.25 none
Class B contingent deferred 0.65 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
Advisor Series V
Municipal Income Fund:
Class A* front-end 0.15 none
Class T* front-end 0.25 none
Class B contingent deferred 0.65 0.25
Class C contingent deferred 0.75 0.25
Institutional Class none none none
</TABLE>
______________________________________________________________
* A contingent deferred sales charge of 0.25% is accessed on certain
redemptions of Class A and Class T shares on which a finder's fee was
paid.
