SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the [x]
Registrant
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[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the
Commission Only (as
permitted by Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant
to Sec. 240.14a-11(c) or
Sec. 240.14a-12
(Name of Registrant as Specified In Its Charter)
Fidelity Advisor Series I
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Registrant)
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[x] No fee required.
[ ] Fee computed on table below
per Exchange Act Rules
14a-6(i)(1) and 0-11.
(1) Title of each class of
securities to which
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(2) Aggregate number of
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transaction applies:
(3) Per unit price or other
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computed pursuant to Exchange
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[ ] Fee paid previously with
preliminary materials.
[ ] Check box if any part of the
fee is offset as provided by
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and identify the filing for
which the offsetting fee was
paid previously. Identify the
previous filing by
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number, or the Form or
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its filing.
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(4) Date Filed:
FIDELITY ADVISOR
STRATEGIC OPPORTUNITIES FUND
A FUND OF
FIDELITY ADVISOR SERIES I
82 DEVONSHIRE STREET, BOSTON, MASSACHUSETTS 02109
CLASS A, CLASS T, CLASS B, AND INSTITUTIONAL CLASS
1-800- 522-7297
FIDELITY STRATEGIC OPPORTUNITIES FUND ("INITIAL CLASS")
1-800- 544-8888
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To the shareholders of Fidelity Advisor Strategic Opportunities Fund:
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders (the
Meeting) of Fidelity Advisor Strategic Opportunities Fund (the fund)
will be held at the office of Fidelity Advisor Series I (the trust),
82 Devonshire Street, Boston, Massachusetts 02109 on June 16, 1999, at
10:00 a.m. The purpose of the Meeting is to consider and act
upon the following proposals, and to transact such other business as
may properly come before the Meeting or any adjournments thereof.
1(a). To eliminate certain fundamental investment policies of the
fund.
1(b). To approve an amended management contract for the fund.
The Board of Trustees has fixed the close of business on April 19,
1999 as the record date for the determination of the shareholders of
the fund entitled to notice of, and to vote at, such Meeting and any
adjournments thereof.
By order of the Board of Trustees,
ERIC D. ROITER, Secretary
April 19, 1999
YOUR VOTE IS IMPORTANT -
PLEASE RETURN YOUR PROXY CARD PROMPTLY.
SHAREHOLDERS ARE INVITED TO ATTEND THE MEETING IN PERSON. ANY
SHAREHOLDER WHO DOES NOT EXPECT TO ATTEND THE MEETING IS URGED TO
INDICATE VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD, DATE AND SIGN
IT, AND RETURN IT IN THE ENVELOPE PROVIDED, WHICH NEEDS NO POSTAGE IF
MAILED IN THE UNITED STATES. IN ORDER TO AVOID UNNECESSARY EXPENSE, WE
ASK YOUR COOPERATION IN MAILING YOUR PROXY CARD PROMPTLY, NO MATTER
HOW LARGE OR SMALL YOUR HOLDINGS MAY BE.
INSTRUCTIONS FOR EXECUTING PROXY CARD
The following general rules for executing proxy cards may be of
assistance to you and help avoid the time and expense involved in
validating your vote if you fail to execute your proxy card properly.
1. INDIVIDUAL ACCOUNTS: Your name should be signed exactly as it
appears in the registration on the proxy card.
2. JOINT ACCOUNTS: Either party may sign, but the name of the party
signing should conform exactly to a name shown in the registration.
3. ALL OTHER ACCOUNTS should show the capacity of the individual
signing. This can be shown either in the form of the account
registration itself or by the individual executing the proxy card. For
example:
REGISTRATION VALID SIGNATURE
A. 1) ABC Corp. John Smith, Treasurer
2) ABC Corp. John Smith, Treasurer
c/o John Smith, Treasurer
B. 1) ABC Corp. Profit Sharing Plan Ann B. Collins, Trustee
2) ABC Trust Ann B. Collins, Trustee
3) Ann B. Collins, Trustee Ann B. Collins, Trustee
u/t/d 12/28/78
C. 1) Anthony B. Craft, Cust. Anthony B. Craft
f/b/o Anthony B. Craft, Jr.
UGMA
PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS OF
FIDELITY ADVISOR SERIES I:
FIDELITY ADVISOR STRATEGIC OPPORTUNITIES FUND
TO BE HELD ON JUNE 16, 1999
This Proxy Statement is furnished in connection with a solicitation
of proxies made by, and on behalf of, the Board of Trustees of
Fidelity Advisor Series I (the trust) to be used at the Special
Meeting of Shareholders of Fidelity Advisor Strategic Opportunities
Fund (the fund) and at any adjournments thereof (the Meeting), to be
held on June 16, 1999 at 10:00 a .m. at 82 Devonshire Street,
Boston, Massachusetts 02109, the principal executive office of the
trust and Fidelity Management & Research Company (FMR), the fund's
investment adviser.
The purpose of the Meeting is set forth in the accompanying Notice.
The solicitation is being made primarily by the mailing of this Proxy
Statement and the accompanying proxy card on or about April 19, 1999.
Supplementary solicitations may be made by mail, telephone, telegraph,
facsimile, electronic means or by personal interview by
representatives of the trust. In addition, Management Information
Services Corp. (MIS) and D.F. King & Co., Inc. may be paid on a
per-call basis to solicit shareholders on behalf of the fund at an
anticipated cost of approximately $ 20,000. The expenses in
connection with preparing this Proxy Statement and its enclosures and
of all solicitations will be paid by the fund, provided the expenses
do not exceed the existing class expense caps listed on page
17. Expenses exceeding a class's expense cap will be paid by
FMR. The fund will reimburse brokerage firms and others for their
reasonable expenses in forwarding solicitation material to the
beneficial owners of shares. The principal business address of
Fidelity Distributors Corporation (FDC), the fund's principal
underwriter and distribution agent, and Fidelity Management & Research
(U.K.) Inc. (FMR U.K.) and Fidelity Management & Research (Far East)
Inc. (FMR Far East), subadvisers to the fund, is 82 Devonshire Street,
Boston, Massachusetts 02109.
If the enclosed proxy card is executed and returned, it may
nevertheless be revoked at any time prior to its use by written
notification received by the trust, by the execution of a later-dated
proxy card, by the trust's receipt of a subsequent valid telephonic
vote or by attending the Meeting and voting in person.
All proxy cards solicited by the Board of Trustees that are properly
executed and received by the Secretary prior to the Meeting, and are
not revoked, will be voted at the Meeting. Shares represented by such
proxies will be voted in accordance with the instructions thereon. If
no specification is made on a proxy card, it will be voted FOR the
matters specified on the proxy card. Only proxies that are voted will
be counted towards establishing a quorum. Broker non-votes are not
considered voted for this purpose. Shareholders should note that while
votes to ABSTAIN will count toward establishing a quorum, passage of
any proposal being considered at the Meeting will occur only if a
sufficient number of votes are cast FOR the proposal. Accordingly,
votes to ABSTAIN and votes AGAINST will have the same effect in
determining whether the proposal is approved.
The fund may also arrange to have votes recorded by telephone. The
expenses in connection with telephone voting will be paid by the fund,
provided the expenses do not exceed the existing class expense caps
listed on page 18 . Expenses exceeding a class's expense cap
will be paid by FMR. If the fund records votes by telephone, it will
use procedures designed to authenticate shareholder's identities, to
allow shareholders to authorize the voting of their shares in
accordance with their instructions, and to confirm that their
instructions have been properly recorded. Proxies voted by telephone
may be revoked at any time before they are voted in the same manner
that proxies voted by mail may be revoked. D.F. King & Co., Inc. may
be paid on a per-call basis for vote-by-phone solicitations on behalf
of the fund at an anticipated cost of approximately $5,000.
If a quorum is not present at the Meeting, or if a quorum is present
at the Meeting but sufficient votes to approve one or more of the
proposed items are not received, or if other matters arise requiring
shareholder attention, the persons named as proxy agents may propose
one or more adjournments of the Meeting to permit further solicitation
of proxies. Any such adjournment will require the affirmative vote of
a majority of those shares present at the Meeting or represented by
proxy. When voting on a proposed adjournment, the persons named as
proxy agents will vote FOR the proposed adjournment all shares that
they are entitled to vote with respect to each item, unless directed
to vote AGAINST the item, in which case such shares will be voted
AGAINST the proposed adjournment with respect to that item. A
shareholder vote may be taken on one or more of the items in this
Proxy Statement prior to such adjournment if sufficient votes have
been received and it is otherwise appropriate.
Shares of each class o f the fund issu ed and outstanding as of
February 28, 1999 are indicated in the following table:
Class A 170,863
Class T 17,462,338
Class B 3,990,997
Institutional Class 1 36,015
Initial Class 7 35,660
As of February 28, 1999, the Trustees and officers of the trust
owned, in the aggregate, less than 1% of the fund's outstanding
shares.
To the knowledge of the trust, substantial (5% or more) record or
beneficial ownership of each class of the fund on February 28, 1999
was as follows:
Fidelity Advisor Strategic Opportunities Fund - Class A: Correll
Company, Hickory Hills, IL (8.66%).
Fidelity Advisor Strategic Opportunities Fund - Class T: Merrill
Lynch, New York, NY (11.14%); CIGNA Corp. & Affiliates, Hartford, CT
(7.68%); A.G. Edwards & Sons Inc., St. Louis, MO (6.15%); Prudential
Securities, New York, NY (5.18%); Salomon Smith Barney, Inc., New
York, NY (5.13%).
Fidelity Advisor Strategic Opportunities Fund - Institutional
Class: National Bank of Alaska, Anchorage, AK (28.06%); Whitney
National Bank, New Orleans, LA (16.51%); Thumb National Bank & Trust,
Pigeon, MI (9.56%); First Trust, Denver, CO (8.26%); First Tennessee
Bank, Memphis, TN (6.70%).
To the knowledge of the trust, no other shareholder owned of record
or beneficially more than 5% of the outstanding shares of each class
of the fund on that date.
Shareholders of record at the close of business on April 19, 1999
will be entitled to vote at the Meeting. Each such shareholder will be
entitled to one vote for each dollar of net asset value held on that
date.
FOR A FREE COPY OF THE FUND'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED
NOVEMBER 30, 1998 CALL 1 -800-843-3001 (CLASS A, CLASS T, CLASS B,
AND INSTITUTIONAL CLASS) OR 1-800-544-8888 (INITIAL CLASS) OR
WRITE TO FIDELITY DISTRIBUTORS CORPORATION AT 82 DEVONSHIRE
STREET, BOSTON, MASSACHUSETTS 02109.
VOTE REQUIRED: APPROVAL OF PROPOSALS 1(A) AND 1(B) REQUIRES THE
AFFIRMATIVE VOTE OF A "MAJORITY OF THE OUTSTANDING VOTING SECURITIES"
OF THE FUND. UNDER THE INVESTMENT COMPANY ACT OF 1940 (THE 1940 ACT),
THE VOTE OF A "MAJORITY OF THE OUTSTANDING VOTING SECURITIES" MEANS
THE AFFIRMATIVE VOTE OF THE LESSER OF (A) 67% OR MORE OF THE VOTING
SECURITIES PRESENT AT THE MEETING OR REPRESENTED BY PROXY IF THE
HOLDERS OF MORE THAN 50% OF THE OUTSTANDING VOTING SECURITIES ARE
PRESENT OR REPRESENTED BY PROXY OR (B) MORE THAN 50% OF THE
OUTSTANDING VOTING SECURITIES. BROKER NON-VOTES ARE NOT CONSIDERED
"PRESENT" FOR THIS PURPOSE.
Proposals 1(a) and 1(b) are contingent upon each other; neither
proposal will be implemented unless both proposals are approved.
1(A). TO ELIMINATE CERTAIN FUNDAMENTAL INVESTMENT POLICIES OF THE
FUND.
The Board of Trustees has approved, and recommends that shareholders
of the fund approve, a proposal to eliminate certain of the fund's
fundamental investment policies. Although the fund's current
fundamental investment policies do not specify a particular investment
style or market capitalization, the fund's holdings have tended to be
value stocks with significantly smaller market capitalizations than
the broad market. The proposal will allow the fund to be defined more
clearly in the future as a value fund that focuses on medium-sized
companies. The fund's investment objective of capital appreciation
will not change. If the proposal is approved, the Trustees intend
to change the fund's name to "Fidelity Advisor Value Strategies Fund"
to better reflect the fund's in vestment style.
FUNDAMENTAL INVESTMENT OBJECTIVE AND INVESTMENT POLICIES. T he fund
was originally organized in 1983 as a "special situation" fund. The
fund's current policies still require it to invest in "special
situations." The fund's investment objective and its policies
regarding investment in special situations currently read as
follows:
"The fund seeks capital appreciation by investing primarily in
securities of companies believed by FMR to involve a "special
situation." Under normal conditions, the fund will invest at least 65%
of its total assets in companies involving a special situation."
The term "special situation" is defined as an unusual, and
possibly non-repetitive, development taking place in a company or a
group of companies in an industry. Because the investment
objective and policies quoted above a re fundamental, they
cannot be modified or eliminated without shareholder approval.
If the proposal is approved, the fund's fundamental investment
objective would read as follows (deleted language is [bracketed]):
"The fund seeks capital appreciation [by investing primarily in
securities of companies believed by FMR to involve a "special
situation." Under normal conditions, the fund will invest at least 65%
of its total assets in companies involving a special situation]."
If the proposal is approved, the fund could continue to search for
investments representing special situations, but its
fundamental investment policies no longer would require it
to do so.
FMR has found that investment opportunities for the fund that
represent special situations also tend to constitute value
investments. If the proposal is approved, FMR intends to focus the
fund's investments on securities of companies that it believes are
undervalued in the marketplace in relation to factors such as the
company's assets, earnings, or growth potential. "Value" stocks can
react differently to issuer, political, market and economic
developments than the market as a whole and other types of stocks.
"Value" stocks tend to be inexpensive relative to their earnings or
assets compared to other types of stocks. However, "value" stocks can
continue to be inexpensive for long periods of time and may not ever
realize their full value.
In addition, the fund's holdings have tended to have significantly
smaller market capitalizations than the broad market. If the
proposal is approved, FMR i ntends to focus the fund's
investments on securities of medium-size d companies, although
FMR also would be able to make substantial investments in securities
of larger or smaller companies to achieve the fund's objective of
capital appreciation . Securities of smaller, less well-known
issuers can be more volatile than securities of larger issuers.
The Board of Trustees believes that it is in the best interests of
the fund and its shareholders to eliminate the fundamental investment
policies regarding investments in special situations. If the proposal
is approved, the Trustees intend to change the fund's name to
"Fidelity Advisor Value Strategies Fund" to better reflect the fund's
investment style. This name change does not require shareholder
approval, however, and is not part of the proposal.
OTHER FUNDAMENTAL INVESTMENT POLICIES. Certain of the fund's other
investment policies currently read as follows:
"FMR intends to invest primarily in common stocks and securities that
are convertible into common stocks; however, it also may invest in
debt securities of all types and quality if FMR believes that
investing in these securities will result in capital appreciation. The
fund may invest up to 30% of its assets in foreign investments."
Because the foregoing investment policies are fundamental, they
cannot be modified or eliminated without shareholder approval.
If the proposal is approved, the fundamental investment policies
stated above would be eliminated. The fund currently has a
non-fundamental investment policy of investing its assets primarily in
common stocks. If the proposal is approved, t he Board of Trustees
could change this policy without shareholder approval; however, the
Trustees have no current intention of doing so.
Eliminating the fundamental policy stating that "the fund may invest
up to 30% of its assets in foreign investments" would allow the
fund the flexibility to invest in securities of foreign issuers
without limitation, if FMR deems such investments appropriate and
consistent with the fund's investment objective and strategies.
This change would give the fund the same flexibility as other Fidelity
domestic equity funds, most of which do not restrict the amount that
may be invested in domestic versus foreign securities. The fund
potentially could be subject to increased exposure to foreign
investments. Foreign securities, foreign currencies, and securities
issued by U.S. entities with substantial foreign operations can
involve additional risks relating to political, economic, or
regulatory conditions in foreign countries. These risks include
fluctuations in foreign currencies; withholding or other taxes;
trading, settlement, custodial and other operational risks; and the
less stringent investor protection and disclosure standards of some
foreign markets. All of these factors can make foreign investments,
especially those in emerging markets, more volatile and potentially
less liquid than U.S. investments. In addition, foreign markets can
perform differently than the U.S. market.
Eliminating the foregoing fundamental investment policies would
provide the fund with greater flexibility when choosing investments.
If the proposal is approved, the fund would be able to react to
changing market and regulatory conditions, subject to the supervision
of the Board of Trustees, without the delay and potential costs of
seeking further shareholder approval through a proxy
solicitation.
The fund's current investment policies are lengthier than the
policies currently disclosed for other Fidelity funds that already
conform with the requirements of amended Form N-1A. Eliminating
the foregoing fundamental investment policies would allow the fund to
more clearly communicate its investment objective and strategies in
conformity with amended Form N-1A, which requires concise,
understandable descriptions of a fund's investment objective and
strategies. Eliminating the foregoing fundamental investment policies
also would allow the fund to more clearly communicate its investment
objective and strateg ies to shareholders.
CONCLUSION. The Board of Trustees has concluded that it is in the
best interests of the fund and its shareholders to eliminate the
fundamental investment policies set forth above, and recommends that
shareholders vote FOR the proposal.
Approval of this proposal is contingent upon shareholder approval of
Proposal 1(b). If both this proposal and Proposal 1(b) are approved,
the elimination of the fundamental investment policies will take
effect when the disclosure is revised to reflect the changes. If both
this proposal and Proposal 1(b) are not approved, the fund's current
fundamental investment policies will remain unchanged.
1(B). TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR THE FUND.
The Board of Trustees, including the Trustees who are not "interested
persons" of the trust or of FMR (the Independent Trustees), has
approved, and recommends that shareholders of the fund approve, a
proposal to adopt an amended management contract with FMR (the Amended
Contract). The Amended Contract eliminates the performance adjustment
( the Performance Adjustment) component of the management fee
that FMR receives from the fund for managing its investments and
business affairs under the fund's existing management contract with
FMR (the Present Contract). If Proposal 1(a) is approved, the
Standard & Poor's 500 Index (the S&P 500) - the index used to
calculate the fund's Performance Adjustment under the Present Contract
- - no longer will be an appropriate benchmark for the fund.
I n addition, the Amended Contract allows FMR and the trust, on
behalf of the fund, to modify the Management Contract subject to the
requirements of the 1940 Act. The Present Contract currently requires
the vote of a majority of the fund's outstanding voting securities to
authorize all amendments. See "Modification of Management Contract
Amendment Provisions" on page 14 for more details. (For information on
FMR, see the section entitled "Activities and Management of FMR" on
page .)
CURRENT MANAGEMENT FEE. The management fee is calculated and paid
monthly, and is normally expressed as an annual percentage of the
fund's average net assets. The fee has two components: a Basic Fee and
a Performance Adjustment. The Basic Fee is an annual percentage of the
fund's average net assets for the current month. The Basic Fee rate is
the sum of a group fee rate, which declines as FMR's fund assets under
management increase, and a fixed individual fund fee rate of 0.30%.
The Basic Fee rate for the fund's fiscal year ended November 30, 1998
was 0.5905%.
The Performance Adjustment is a positive or negative dollar amount
based on the fund's performance and assets for the most recent 36
months. If the fund outperforms the S&P 500 over 36 months, FMR
receives a positive Performance Adjustment, and if the fund
underperforms the S&P 500, the management fee is reduced by a negative
Performance Adjustment. The Performance Adjustment is an annual
percentage of the fund's average net assets over the 36-month
performance period. The Performance Adjustment rate is 0.02% for each
percentage point (the performance of the fund and the S&P 500 each
being calculated to the nearest 0.01%) of outperformance or
underperformance, subject to a maximum of 0.20% of the average net
assets over the 36-month performance period.
PROPOSED MANAGEMENT FEE AMENDMENTS. A copy of the form of Amended
Contract, marked to indicate the proposed amendments, is attached as
Exhibit 1 on page 21. The Amended Contract would (1) eliminate the
Performance Adjustment component of the management fee effective 18
months after the date that the Amended Contract takes effect, and (2)
allow FMR and the trust, on behalf of the fund, to modify the
Management Contract subject to the requirements of the 1940 Act. For a
detailed discussion of the fund's Present Contract, refer to the
section entitled "Present Management Contract" beginning on page .
Except for the modifications discussed above, the Amended Contract is
substantially identical to the fund's Present Contract with FMR. If
approved by shareholders, the Amended Contract will take effect on the
first day of the first month following approval, with the Performance
Adjustment being eliminated over 18 months, as discussed below. The
Amended Contract, if approved, will remain in effect through July 31,
2000 and thereafter, but only as long as its continuance is approved
at least annually by (i) the vote, cast in person at a meeting called
for the purpose, of a majority of the Independent Trustees and (ii)
the vote of either a majority of the Trustees or a majority of the
outstanding shares of the fund. If the Amended Contract and Proposal
1(a) are not approved, the Present Contract will continue in effect
through July 31, 1999, and thereafter only as long as its continuance
is approved at least annually as described above.
IMPACT OF ELIMINATING THE PERFORMANCE ADJUSTMENT. If the proposal is
approved, after an 18-month "phase-out" period (described in detail
below) during which the Performance Adjustment will be eliminated, the
fund's aggregate management fee rate will equal the Basic Fee rate .
T he Basic Fee rate no longer will be increased or decreased
based on the fund's performance relative to the S&P 500. The future
impact of eliminating the Performance Adjustment will depend on many
different factors and may represent an increase or a decrease from the
fund's aggregate management fee under the Present Contract.
During the fiscal year ended November 30, 1998, the fund's aggregate
management fee rate was 0.3772%, composed of a Basic Fee rate of
0.5905% reduced by a negative Performance Adjustment of 0.2133%. Thus,
the Performance Adjustment resulted in a lower aggregate management
fee under the Present Contract than would have resulted under the
Amended Contract, assuming the Performance Adjustment had been
eliminated.
ELIMINATION OF PERFORMANCE ADJUSTMENT. Performance adjustments are
intended to reward a fund's investment adviser for good investment
performance and penalize a fund's investment adviser for bad
investment performance. The Securities and Exchange Commission (SEC)
rules for calculating performance adjustments generally ensure
that positive or negative adjustments result from the investment
adviser's management skill and not from random or irrelevant factors.
To this end, the SEC rules require that an appropriate benchmark index
be used for purposes of calculating a performance adjustment.
If Proposal 1(a) is approved, FMR intends to focus the fund's
investments on value stocks . FMR also intends to focus the fund's
investments on securities of medium-sized companies. The S&P 500 -
the index used to calculate the fund's Performance Adjustment under
the Present Contract - is a broad measure of the performance of
the overall U.S. stock market and includes both "growth" stocks and
"value" stocks. The S&P 500 also has a significantly higher average
market capitalization than the fund. I f Proposal 1(a) is approved,
the S&P 500 no longer will be an appropriate benchmark for purposes of
calculating the Performance Adjustment. FMR considered whether to
recommend changing the Performance Adjustment index from the S&P 500
to a more narrowly-based index, but determined instead to recommend
eliminating the Performance Adjustment due to the difficulties of
calculating performance adjustments for multiple class funds.
PHASE-OUT PERIOD. If the proposal is approved, to prevent unfairness
to the fund 's shareholders , the Performance Adjustment will be
phased out over a period equal to one-half the period used to
calculate the Performance Adjustment. Because the Performance
Adjustment is based on a 36-month performance period, FMR will
continue to calculate the Performance Adjustment for an 18-month
period beginning on the first day of the first month following
shareholder approval of the proposal. During this period, FMR will not
receive any positive Performance Adjustments but instead will receive
the lower of the Basic Fee or the Basic Fee less the Performance
Adjustment. Thus, during this phase-out period, the Performance
Adjustment can decrease, but not increase, the management fee owed by
the fund. During this phase-out period, FMR will continue to use the
S&P 500 for performance fee calculations. Given the fund's significant
underperformance versus the S&P 500 over the previous 36-month period,
FMR anticipates a maximum negative Performance Adjustment over the
phase-out period.
COMPARISON OF MANAGEMENT FEES. The following table compares the
fund's management fee as calculated under the terms of the Present
Contract for the fiscal year ended November 30, 1998, to the
management fee that the fund would have incurred under the Amended
Contract if the Amended Contract (but not the Performance Adjustment)
had been in effect during that same period. Management fees are
expressed in dollars and as percentages of the fund's average net
assets for the period.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Present Contract Amended Contract Difference
$ % $ % $ %
Basic Fee 3,718,524 0.5905 3,718,524 0.5905 0 0
Performance Adjustment (1,343,174) (0.2133) 0 0 1,343,174 0.2133
Total Management Fee 2,375,350 0.3772 3,718,524 0.5905 1,343,174 0.2133
</TABLE>
The following tables provide data concerning each class's management
fees and expenses as a percentage of its average net assets for
the fiscal year ended November 30, 1998 under the Present Contract and
if the Amended Contract (but not the Performance Adjustment) had been
in effect during that same period.
COMPARATIVE FEE TABLE
Annual Class Operating Expenses
(as a percentage of average net assets)
The following figures are based on historical expenses, adjusted to
reflect current fees, of Class A, Class T, Class B, Institutional
Class, and Initial Class of the fund and do not reflect the effect
of any expense reimbursements or reduction of certain expenses during
the period. The figures are calculated as a percentage of average
net assets of each class.
Class A:
Present Contract Amended Contract
Management Fee 0.38% 0.59%
12b-1 Fee 0.25% 0.25%
Other Expenses 0.43% 0.43%
Total Class Operating Expenses* 1.06% 1.27%
Class T:
Present Contract Amended Contract
Management Fee 0.38% 0.59%
12b-1 Fee 0.50% 0.50%
Other Expenses 0.29% 0.29%
Total Class Operating Expenses* 1.17% 1.38%
Class B:
Present Contract Amended Contract
Management Fee 0.38% 0.59%
12b-1 Fee 1.00% 1.00%
Other Expenses 0.33% 0.33%
Total Class Operating Expenses* 1.71% 1.92%
Institutional Class:
Present Contract Amended Contract
Management Fee 0.38% 0.59%
12b-1 Fee None None
Other Expenses 0.30% 0.30%
Total Class Operating Expenses* 0.68% 0.89%
Initial Class:
Present Contract Amended Contract
Management Fee 0.38% 0.59%
12b-1 Fee None None
Other Expenses 0.27% 0.27%
Total Class Operating Expenses* 0.65% 0.86%
* Effective February 27, 1999, FMR has voluntarily agreed to reimburse
each class of the fund to the extent that total operating expenses
(excluding interest, taxes, securities lending fees, brokerage
commissions, and extraordinary expenses), as a percentage of its
average net assets, exceed 1.30%, Class A; 1.55%, Class T; 2.05%,
Class B; 1.05%, Institutional Class; and 1.05%, Initial Class.
A portion of the brokerage commissions that the fund pays is used to
reduce the fund's expenses. In addition, the fund has entered into
arrangements with its custodian and transfer agent whereby credits
realized as a result of uninvested cash balances are used to reduce
custodian and transfer agent expenses. Including these reductions, the
total class operating expenses presented in the table would
have been 1.05% for Class A, 1.16% for Class T, 1.70% for Class B,
0.67% for Institutional Class, and 0.64% for Initial Class under the
Present Contract, and 1.26% for Class A, 1.37% for Class T, 1.91% for
Class B, 0.8 8 % for Institutional Class, and 0.8 5 % for
Initial Class under the Amended Contract.
EXAMPLE: The following illustrates the expenses, including the
maximum front-end sales charge or contingent deferred sales charge, as
applicable , on a $10,000 investment under the fees and expenses
stated above, assuming (1) 5% annual return and (2) redemption at the
end of each time period:
Class A:
1 Year 3 Years 5 Years 10 Years
Present Contract $ 677 $ 893 $ 1,126 $ 1,795
Amended Contract $ 697 $ 955 $ 1,232 $ 2,021
Class T:
1 Year 3 Years 5 Years 10 Years
Present Contract $ 465 $ 709 $ 971 $ 1,721
Amended Contract $ 486 $ 772 $ 1,079 $ 1,949
Class B:
1 Year 3 Years 5 Years 10 Years
Present Contract $ 674 $ 839 $ 1,128 $ 1,767*
Amended Contract $ 695 $ 903 $ 1,237 $ 1,996*
* Reflects conversion to Class A shares after seven years.
Institutional Class:
1 Year 3 Years 5 Years 10 Years
Present Contract $ 69 $ 218 $ 379 $ 847
Amended Contract $ 91 $ 284 $ 493 $ 1,096
Initial Class:
1 Year 3 Years 5 Years 10 Years
Present Contract $ 66 $ 206 $ 362 $ 810
Amended Contract $ 88 $ 274 $ 477 $ 1,061
The purpose of this example and the table is to assist investors in
understanding the various costs and expenses of investing in shares of
the fund. The example above should not be considered a representation
of past or future expenses of the fund. Actual expenses may vary from
year to year and may be higher or lower than those shown above.
MODIFICATION OF MANAGEMENT CONTRACT AMENDMENT PROVISIONS. The Amended
Contract allows FMR and the trust, on behalf of the fund, to amend the
Management Contract subject to the provisions of Section 15 of the
1940 Act, as modified or interpreted by the Securities and Exchange
Commission. In contrast, the Present Contract explicitly requires the
vote of a majority of the outstanding voting securities of the fund to
authorize all amendments. Generally, the proposed modification to the
Present Contract's amendment provisions will allow FMR and the trust,
on behalf of the fund, to amend the Management Contract without
shareholder vote IF THE 1940 ACT PERMITS THEM TO DO SO. For example,
under current interpretations of Section 15 of the 1940 Act, the
Amended Contract would give FMR and the trust the ability to amend the
Management Contract to immediately reflect a management fee decrease
without the delay of having to first conduct a proxy solicitation. In
short, the proposed modification gives FMR and the trust added
flexibility to amend the Management Contract subject to 1940 Act
constraints. Of course, any future amendments to the Management
Contract would require the approval of the fund's Board of Trustees.
MATTERS CONSIDERED BY THE BOARD
The mutual funds for which the members of the Board of Trustees serve
as Trustees are referred to herein as the "Fidelity funds." The Board
of Trustees meets eleven times a year. The Board of Trustees,
including the Independent Trustees, believe that matters bearing on
the appropriateness of the fund's management fees are considered at
most, if not all, of their meetings. While the full Board of Trustees
or the Independent Trustees, as appropriate, act on all major matters,
a significant portion of the activities of the Board of Trustees
(including certain of those described herein) is conducted
through committees. The Independent Trustees meet frequently in
executive session and are advised by independent legal counsel
selected by the Independent Trustees.
The proposal to present the Amended Contract to shareholders was
approved by the Board of Trustees of the fund, including all of the
Independent Trustees, on October 16, 1997 and January 14, 1999. The
Board of Trustees received materials relating to the Amended Contract
in advance of the meeting at which the Amended Contract was
considered, and had the opportunity to ask questions and request
further information in connection with such consideration.
INFORMATION RECEIVED BY THE INDEPENDENT TRUSTEES. In connection with
their monthly meetings, the Trustees received materials specifically
relating to the Amended Contract. These materials included: (i)
information on the investment performance of the fund, a peer group of
funds and an appropriate index or combination of indices, (ii) sales
and redemption data in respect of the fund, and (iii) the economic
outlook and the general investment outlook in the markets in which the
fund invests. The Board of Trustees and the Independent Trustees also
consider periodically other material facts such as (1) FMR's results
and financial condition, (2) arrangements in respect of the
distribution of the fund's shares, (3) the procedures employed to
determine the value of the fund's assets, (4) the allocation of the
fund's brokerage, if any, including allocations to brokers affiliated
with FMR and the use of "soft" commission dollars to pay fund expenses
and to pay for research and other similar services, (5) FMR's
management of the relationships with the fund's custodian and
subcustodians, (6) the resources devoted to and the record of
compliance with the fund's investment policies and restrictions and
with policies on personal securities transactions, and (7) the nature,
cost, and character of non-investment management services provided by
FMR and its affiliates.
In response to questions raised by the Independent Trustees,
additional information was furnished by FMR including, among other
items, information on and analysis of (a) the overall organization of
FMR, (b) the impact of performance adjustments to management fees, (c)
the choice of performance indices and benchmarks, (d) the composition
of peer groups of funds, (e) transfer agency and bookkeeping fees paid
to affiliates of FMR, (f) investment performance, (g) investment
management staffing, (h) the potential for achieving further economies
of scale, (i) operating expenses paid to third parties, and (j) the
information furnished to investors, including the fund's shareholders.
In considering the Amended Contract, the Board of Trustees and the
Independent Trustees did not identify any single factor as
all-important or controlling, and the following summary does not
detail all of the matters considered. Matters considered by the Board
of Trustees and the Independent Trustees in connection with their
approval of the Amended Contract include the following:
BENEFITS TO SHAREHOLDERS. The Board of Trustees and the Independent
Trustees considered the benefit to shareholders of investing in a fund
that is part of a large family of funds offering a variety of
investment disciplines and providing for a large variety of fund and
shareholder services. With regard to the proposed elimination of the
Performance Adjustment, the Board of Trustees and the Independent
Trustees considered the management fee formulas of other comparable
funds, the performance of the fund and mutual funds generally relative
to the index, both before and after expenses, including 12b-1 fees,
and the advantages to investors, including the fund's shareholders, of
distributing fund shares through distribution channels that require
payment of 12b-1 fees. With regard to the proposed modification to the
Present Contract's amendment provisions, the Board of Trustees and the
Independent Trustees considered the benefit to shareholders of FMR's
and the trust's increased flexibility (within 1940 Act constraints) to
amend the Management Contract without the delays and potential costs
of a proxy solicitation.
INVESTMENT COMPLIANCE AND PERFORMANCE. The Board of Trustees and the
Independent Trustees considered whether the fund has operated within
its investment objective and its record of compliance with its
investment restrictions. They also reviewed monthly the fund's
investment performance as well as the performance of a peer group of
mutual funds, and the performance of an appropriate index or
combination of indices. In particular, the Board of Trustees and the
Independent Trustees reviewed the performance of the fund as compared
to the Index on a monthly and rolling 36-month performance basis for
the three years ended November 30, 1998 and as compared to a Lipper
peer group of mutual funds. The Board of Trustees and the Independent
Trustees also considered the impact of eliminating the fund's
Performance Adjustment on the fund's management fee for the year ended
November 30, 1998 and considered how rolling 36-month returns would be
affected during an 18-month wind-down period, assuming the fund's
performance matched the Index during that period.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the
Independent Trustees review at least annually the background of the
fund's portfolio manager, and the fund's investment objective and
discipline. The Independent Trustees have also had discussions with
senior management of FMR responsible for investment operations, and
the senior management of Fidelity's equity group. Among other things
they considered the size, education and experience of FMR's investment
staff, its use of technology, and FMR's approach to recruiting,
training and retaining portfolio managers and other research, advisory
and management personnel.
NATURE AND QUALITY OF OTHER SERVICES. The Board of Trustees and the
Independent Trustees considered the nature, quality, cost and extent
of administrative and shareholder services performed by FMR and
affiliated companies, both under the Present Contract and the Amended
Contract and under separate agreements covering transfer agency
functions and pricing, bookkeeping and securities lending services, if
any. The Board of Trustees and the Independent Trustees have also
considered the nature and extent of FMR's supervision of third party
service providers, principally custodians and subcustodians.
EXPENSES. The Board of Trustees and the Independent Trustees
considered the fund's expense ratio and expense ratios of a peer group
of funds. They also considered the amount and nature of fees paid by
shareholders.
PROFITABILITY. The Board of Trustees and the Independent Trustees
considered the level of FMR's profits in respect of the management of
the Fidelity funds, including the fund. This consideration included an
extensive review of FMR's methodology in allocating its costs to the
management of the fund. The Board of Trustees and the Independent
Trustees have concluded that the cost allocation methodology employed
by FMR has a reasonable basis and is appropriate in light of all of
the circumstances. They considered the profits realized by FMR in
connection with the operation of the fund and whether the amount of
profit is a fair entrepreneurial profit for the management of the
fund. They also considered the profits realized from non-fund
businesses which may benefit from or be related to the fund's
business. The Board of Trustees and the Independent Trustees also
considered FMR's profit margins in comparison with available industry
data, both accounting for and ignoring marketing expenses.
ECONOMIES OF SCALE. The Board of Trustees and the Independent
Trustees considered whether there have been economies of scale in
respect of the management of the Fidelity funds, whether the Fidelity
funds (including the fund) have appropriately benefited from any
economies of scale, and whether there is potential for realization of
any further economies of scale. The Board of Trustees and the
Independent Trustees have concluded that FMR's mutual fund business
presents some limited opportunities to realize economies of scale and
that these economies are being shared between fund shareholders and
FMR in an appropriate manner. The Independent Trustees have also
concluded that the existing group fee structure should be continued.
OTHER BENEFITS TO FMR. The Board of Trustees and the Independent
Trustees also considered the character and amount of fees paid by the
fund and the fund's shareholders for services provided by FMR and its
affiliates, including fees for services like transfer agency, fund
accounting and direct shareholder services. They also considered the
allocation of fund brokerage to brokers affiliated with FMR and the
receipt of sales loads and payments under Rule 12b-1 plans in respect
of certain of the Fidelity funds. The Board of Trustees and the
Independent Trustees also considered the revenues and profitability of
FMR businesses other than its mutual fund business, including FMR's
retail brokerage, correspondent brokerage, capital markets, trust,
investment advisory, pension record keeping, insurance, publishing,
real estate, international research and investment funds, and others.
The Board of Trustees and the Independent Trustees considered the
intangible benefits that accrue to FMR and its affiliates by virtue of
their relationship with the fund.
CONCLUSION. Based on their evaluation of all material factors and
assisted by the advice of independent counsel, the Trustees concluded
(i) that the existing management fee structure is fair and reasonable
and (ii) that the proposed modification to the management fee rate,
that is, the elimination of the Performance Adjustment and the
proposed modification to the Present Contract's amendment provisions,
are in the best interest of the fund's shareholders. The Board of
Trustees, including the Independent Trustees, voted to approve the
submission of the Amended Contract to shareholders of the fund and
recommends that shareholders of the fund vote FOR the Amended
Contract.
Approval of this proposal is contingent upon shareholder approval of
Proposal 1(a). If this proposal and Proposal 1(a) are approved, the
Amended Contract will take effect on the first day of the first month
following shareholder approval. If this proposal and Proposal 1(a) are
not approved, the Present Contract will remain unchanged.
OTHER BUSINESS
The Board knows of no other business to be brought before the
Meeting. However, if any other matters properly come before the
Meeting, it is the intention that proxies that do not contain specific
instructions to the contrary will be voted on such matters in
accordance with the judgment of the persons therein designated.
ACTIVITIES AND MANAGEMENT OF FMR
FMR, a corporation organized in 1946, serves as investment adviser to
a number of investment companies. Information concerning the advisory
fees and averag e net assets of funds with investment objectives
similar to Fidelity Advisor Strategic Opportunities Fund and advised
by FMR is contained in the Table of Average Net Assets and Expense
Ratios in Exhibit 2 beginning on page 28.
FMR, its officers and directors, its affiliated companies, and the
Trustees, from time to time have transactions with various banks,
including the custodian banks for certain of the funds advised by FMR.
Those transactions that have occurred to date have included 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.
The Directors of FMR are Edward C. Johnson 3d, Chairman of the Board
and of the Executive Committee; Robert C. Pozen, President; and Peter
S. Lynch, Vice Chairman. Each of the Directors is also a Trustee of
the trust. Messrs. Johnson 3d, Pozen, J. Gary Burkhead, John H.
Costello, Eric D. Roiter, Richard A. Silver, Leonard M. Rush, and
Harris Leviton, and Ms. Abigail Johnson are currently officers of the
trust and officers or employees of FMR or FMR Corp. With the exception
of Mr. Costello and Mr. Silver, all of these persons hold or have
options to acquire stock of FMR Corp. The principal business address
of each of the Directors of FMR is 82 Devonshire Street, Boston,
Massachusetts 02109.
All of the stock of FMR is owned by its parent company, FMR Corp., 82
Devonshire Street, Boston, Massachusetts 02109, which was organized on
October 31, 1972. Members of Mr. Edward C. Johnson 3d's family are the
predominant owners of a class of shares of common stock, representing
approximately 49% of the voting power of FMR Corp., and, therefore,
under the 1940 Act may be deemed to form a controlling group with
respect to FMR Corp.
During the period December 1, 1997 through February 28, 1999, no
transactions were entered into by Trustees of the trust involving more
than 1% of the voting common, non-voting common and equivalent stock,
or preferred stock of FMR Corp.
ACTIVITIES AND MANAGEMENT OF FMR U.K. AND FMR FAR EAST
FMR U.K. and FMR Far East are wholly-owned subsidiaries of FMR formed
in 1986 to provide research and investment advice with respect to
companies based outside the United States for certain funds for which
FMR acts as investment adviser. FMR may also grant the sub-advisers
investment management authority as well as authority to buy and sell
securities for certain of the funds for which it acts as investment
adviser, if FMR believes it would be beneficial to a fund.
Funds with investment objectives similar to Fidelity Advisor
Strategic Opportunities Fund managed by FMR with respect to which FMR
currently has sub-advisory agreements with either FMR U.K. or FMR Far
East, and the net assets of each of these funds, are indicated in the
Table of Average Net Assets and Expense Ratios in Exhibit 2 beginning
on page 29.
The Directors of FMR U.K. and FMR Far East are Edward C. Johnson 3d,
Chairman, and Robert C. Pozen, President. Mr. Johnson 3d also is
President and a Trustee of the trust and other funds advised by FMR;
Chairman and a Director of Fidelity Investments Money Management, Inc.
(FIMM); Chairman, Chief Executive Officer, President, and a Director
of FMR Corp., and a Director and Chairman of the Board and of the
Executive Committee of FMR. In addition, Mr. Pozen is Senior Vice
President and a Trustee of the trust and of other funds advised by
FMR; President and a Director of FMR; and President and a Director of
FIMM. Each of the Directors is a stock holder of FMR Corp. The
principal business address of the Directors is 82 Devonshire Street,
Boston, Massachusetts 02109.
PRESENT MANAGEMENT CONTRACT
The fund employs FMR to furnish investment advisory and other
services. Under 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 and state laws;
developing management and shareholder services for the fund; and
furnishing reports, evaluations, and analyses on a variety of subjects
to the Trustees. Services provided by affiliates of FMR will continue
under the proposed management contract described in Proposal
1 (b).
In addition to the management fee payable to FMR, Class A, Class T,
Class B and Institutional Class shares pay transfer agent fees to
Fidelity Investments Institutional Operations Company, Inc. (FIIOC),
an affiliate of FMR. Initial Class shares pay transfer agent fees to
Fidelity Service Company, Inc. (FSC), an affiliate of FMR. The fund
pays pricing and bookkeeping fees to FSC on behalf of each class of
the fund. Although the fund's current management contract provides
that the fund will pay for typesetting, printing, and mailing
prospectuses, statements of additional information, notices and
reports to shareholders, the trust, on behalf of the fund, has entered
into a revised transfer agent agreement with FIIOC or FSC, as
applicable, pursuant to which FIIOC or FSC, as applicable, 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, and the fund's proportionate share of
insurance premiums and Investment Company Institute dues. 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.
Transfer agent fees, including reimbursement for out-of-pocket
expenses, paid to FIIOC or FSC by the applicable class for the fiscal
year ended November 30, 1998 amounted to $12,836 for Class A, $990,228
for Class T, $267,239 for Class B, $10,021 for Institutional Class,
and $36,157 for Initial Class. Pricing and bookkeeping fees, including
reimbursement for out-of-pocket expenses, paid to FSC by the fund for
the fiscal year ended November 30, 1998 amounted to $341,818.
The fund also has a distribution agreement with FDC, a Massachusetts
corporation organized on July 18, 1960. FDC is a broker-dealer
registered under the Securities Exchange Act of 1934 and is a member
of the National Association of Securities Dealers, Inc. The
distribution agreement calls for FDC to use all reasonable efforts,
consistent with its other business, to secure purchasers for shares of
the fund, which are continuously offered. Promotional and
administrative expenses in connection with the offer and sale of
shares are paid by FMR.
Sales charge revenues paid to, and retained by, FDC for the fiscal
year ended November 30, 1998, amounted to the following:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Paid to FDC Retained by FDC
Class A Class T Initial Class Class A Class T Initial Class
$ 70,878 $ 243,044 $ 11 $ 17,322 $ 72,427 $ 0
</TABLE>
FDC collected deferred sale s charge revenue on Class B shares
during the fiscal year ended November 30, 1998 of $232,999. When
shares subject to a deferred sal es charge are sold, FDC pays
commissions from its own resources to dealers through which the sales
are made.
In addition, during the fiscal year ended November 30, 1998, FDC
received from the applicable class fees pursuant to
Distribution and Service Plans under Rule 12b-1 as follows:
12b-1 Fees Paid to FDC
Class A $ 8,709
Class T $ 2,460,259
Class B $ 1,095,801
Currently, up to the full amount of distribution fees paid by Class A
and Class T under their respective Distribution and Service Plans may
be 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 under
its Distribution and Service Plan is retained by FDC as compensation
for its services and expenses in connection with the distribution of
Class B shares, and up to the full amount of service fees paid by
Class B under its Distribution and Service Plan may be reallowed to
investment professionals for providing personal service to and/or
maintenance of Class B shareholder accounts.
FMR is the fund's manager pursuant to a management contract dated
February 28, 1998, which was approved by Fidelity Advisor Series VIII,
as sole shareholder of the fund on February 28, 1998 , pursuant
to an Agreement and Plan of Reorganization approved by shareholders of
the fund on June 18, 1997. The terms of the fund's current management
contract duplicate those of the contract approved by shareholders of
the fund on June 18, 1997. At that time, shareholder approval had been
requested to modify the group fee portion of the management fee to
provide for lower fee rates if FMR's assets under management
remain ed above $138 billion; to modify the performance
adjustment calculation to round the performance of the fund and the
S&P 500 to the nearest 0.01%, rather than the nearest 1.00%; and to
modify the performance adjustment calculation to base the fund's
performance on the asset-weighted average return of all classes,
rather than on the return of the worst-performing class.
For the services of FMR under the management contract, the fund pays
FMR a monthly management fee which has two components: a basic fee,
which is the sum of a group fee rate and an individual fund fee rate,
and a performance adjustment based on a comparison of the fund's
performance to that of the S&P 500 (the Index ).
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 and is calculated on a cumulative basis pursuant to the
graduated fee rate schedule shown below on the left. The schedule
below 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 $643 billion of group net assets - the approximate level for
November 1998 - was 0.2878%, which is the weighted average of the
respective fee rates for each level of group net assets up to $643
billion.
The fund's current management contract reflects the revised group fee
rate schedule below.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES
Average Group Assets Annualized Rate Group Net Assets Effective Annual Fee Rate
0 - $3 billion .5200% $ 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 .2942
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over 534 .2500
</TABLE>
The fund's individual fund fee rate is 0.30%. Based on the average
group net assets of the funds advised by FMR for November 1998, the
fund's annual basic fee rate would be calculated as follows:
Group Fee Rate Individual Fund Fee Rate Basic Fee Rate
0.2878% + 0.30% = 0.5878%
One-twelfth of this annual basic 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.
COMPUTING THE PERFORMANCE ADJUSTMENT. The basic fee for the fund is
subject to upward or downward adjustment, depending upon whether, and
to what extent, the fund's investment performance for the performance
period exceeds, or is exceeded by, the record of the S&P 500 over the
same period. The performance period consists of the most recent month
plus the previous 35 months. Each percentage point of difference,
calculated to the nearest 0.01% (up to a maximum difference of
+/-10.00 ) is multiplied by a performance adjustment rate of 0.02%.
Thus, the maximum annualized adjustment rate is +/-0.20%. For purposes
of calculating the performance adjustment for the fund, the fund's
investment performance will be based on the average performance of all
classes of the fund weighted according to their average assets for
each month in the performance period. This performance comparison is
made at the end of each month. One-twelfth (1/12) of this rate is then
applied to the fund's average net assets for the entire performance
period, giving a dollar amount which will be added to (or subtracted
from) the basic fee.
The fund's performance is calculated based on change in net asset
value (NAV). For purposes of calculating the performance adjustment,
any dividends or capital gain distributions paid by the fund are
treated as if reinvested in fund shares at the NAV as of the record
date for payment. The record of the Index is based on change in value
and is adjusted for any cash distributions from the companies whose
securities compose the Index.
Because the adjustment to the basic fee is based on the fund's
performance compared to the investment record of the Index, the
controlling factor is not whether the fund's performance is up or
down, but whether it is up or down more or less than the record of the
Index. Moreover, the comparative investment performance of the fund is
based solely on the relevant performance period without regard to the
cumulative performance over a longer or shorter period of time.
During the fiscal year ended November 30, 1998, FMR received
$2,375,350 for its services as investment adviser to the fund. This
fee, which includes both the basic fee and the performance adjustment,
was equivalent to 0 .3772% of the average net assets of the
fund. For the fiscal year ended November 30, 1998, the downward
performance adjustment amounted to $1,343,174 for the fund.
FMR may, from time to time, agree to reimburse all or a portion of a
class's total operating expenses (exclusive of interest, taxes,
securities lending fees, brokerage commissions, and extraordinary
expenses). FMR retains the ability to be repaid for these expense
reimbursements in the amount that expenses fall below the limit prior
to the end of the fiscal year.
FMR has voluntarily agreed, subject to revision or termination, to
reimburse each class of the fund to the extent that its total
operating expenses (with the exceptions noted above ), as a
percentage of its respective average net assets, exceed the following
rates:
Class A Class T Class B Institutional Class Initial Class
1.30% 1.55% 2.05% 1.05% 1.05%
SUB-ADVISORY AGREEMENTS
O n 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. 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. The fund's sub-advisory agreements,
each dated February 28, 1998, were approved by Fidelity Advisor
Series VIII, as sole shareholder of the fund on February 28,
1998 , pursuant to an Agreement and Plan of Reorganization
approved by shareholders of the fund on June 18, 1997. The terms of
the fund's current sub-advisory agreements duplicate those of the
agreements approved by shareholders of the fund on June 18, 1997. At
that time, shareholder approval had been requested to amend the fund's
sub-advisory agreements to permit FMR to grant the sub-advisers
investment management authority if FMR believes it would be beneficial
to the fund and its shareholders.
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.
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 (including any performance
adjustment) with respect to the fund's average net assets managed by
the sub-adviser on a discretionary basis.
For providing investment advice and research services, the fees paid
to the sub-advisers for the fiscal year ended November 30, 1998 were
$11,125 and $10,563 for FMR U.K and FMR Far East, respectively.
For providing discretionary investment management and executing
portfolio transactions, no fees were paid to FMR U.K or FMR Far East
for the fiscal year ended November 30, 1998.
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 fund's management contract.
FMR may 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.
During the fiscal year ended November 30, 1998, the fund paid
brokerage commissions of $189,248 to NFSC. During the fiscal year
ended November 30, 1998, this amounted to approximately 18.29% of the
aggregate brokerage commissions paid by the fund.
SUBMISSION OF CERTAIN SHAREHOLDER PROPOSALS
The trust does not hold annual shareholder meetings. Shareholders
wishing to submit proposals for inclusion in a proxy statement for a
subsequent shareholder meeting should send their written proposals to
the Secretary of the Trust, 82 Devonshire Street, Boston,
Massachusetts 02109.
NOTICE TO BANKS, BROKER-DEALERS AND VOTING TRUSTEES
AND THEIR NOMINEES
Please advise the trust, in care of Client Services at
1-800-843-3001 (Class A, Class T, Class B, and Institutional Class) or
Fidelity Service Company, Inc. at 1-800-544-8888 (Initial Class),
whether other persons are beneficial owners of shares for which
proxies are being solicited and, if so, the number of copies of the
Proxy Statement and Annual Reports you wish to receive in order to
supply copies to the beneficial owners of the respective shares.
EXHIBIT 1
((UNDERLINED)) LANGUAGE WILL BE ADDED
[BRACKETED] LANGUAGE WILL BE DELETED
FORM OF MANAGEMENT CONTRACT
BETWEEN
FIDELITY ADVISOR SERIES I:
FIDELITY ADVISOR STRATEGIC OPPORTUNITIES FUND
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
AMENDMENT made ((as of)) this [28th] __ day of [February] _______
[1998] ((1999)), 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 Strategic Opportunities Fund (hereinafter
called the "Portfolio"), and Fidelity Management & Research Company, a
Massachusetts corporation (hereinafter called the "Adviser") as set
forth in its entirety below.
((Required authorization and approval by shareholders and Trustees
having been obtained, the Fund, on behalf of the Portfolio, and the
Adviser hereby consent, pursuant to Paragraph 6 of the existing
Management Contract dated February 28, 1998, to a modification of said
Contract in the manner set forth below. The Amended Management
Contract shall, when executed by duly authorized officers of the Fund
and the Adviser, take effect on _______, 1999.))
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. Management Fee. The Adviser will be compensated on the following
basis for the services and facilities to be furnished hereunder. The
Adviser shall receive a monthly management fee, payable monthly as
soon as practicable after the last day of each month, composed of a
Basic Fee and((, while in effect,)) a Performance Adjustment. ((The
Performance Adjustment will be in effect only through the last
calendar day of the 18 calendar month period beginning on the date
that this amended Contract takes effect. After that date, the
management fee will be composed of a Basic Fee only.)) The Performance
Adjustment is [added to or] subtracted from the Basic Fee [depending
on whether] ((if)) the Portfolio experiences [better or] worse
performance than the Standard and Poor's Daily Stock Price Index of
500 Common Stocks (the "Index"). The Performance Adjustment is not
cumulative. A[n increased fee will result even though the performance
of the Portfolio over some period of time shorter than the performance
period has been behind that of the Index, and, conversely, a]
reduction in the fee will be made for a month even though the
performance of the Portfolio over some period of time shorter than the
performance period has been ahead of that of the Index. The Basic Fee
and((, while in effect,)) the Performance Adjustment will be computed
as follows:
(a) Basic Fee Rate: The annual Basic Fee Rate shall be the sum of
the Group Fee Rate and the Individual Fund Fee Rate calculated to the
nearest millionth decimal place as follows:
(i) Group Fee Rate. The Group Fee Rate shall be based upon the
monthly average of the net assets of the registered investment
companies having Advisory and Service or Management Contracts with the
Adviser (computed in the manner set forth in the ((F))[f]und'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 .520((0))%
3 - 6 .49((00))
6 - 9 .460((0))
9 - 12 .430((0))
12 - 15 .400((0))
15 - 18 .385((0))
18 - 21 .370((0))
21 - 24 .360((0))
24 - 30 .350((0))
30 - 36 .345((0))
36 - 42 .340((0))
42 - 48 .335((0))
48 - 66 .325((0))
66 - 84 .320((0))
84 - 102 .315((0))
102 - 138 .310((0))
138 - 174 .305((0))
174 - 210 .300((0))
210 - 246 .295((0))
246 - 282 .290((0))
282 - 318 .285((0))
318 - 354 .280((0))
354 - 390 .275((0))
390 - 426 .270((0))
426 - 462 .265((0))
462 - 498 .260((0))
498 - 534 .255((0))
Over 534 .250((0))
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall
be .30%.
(b) Basic Fee. One-twelfth of the Basic Fee Rate shall be applied to
the average of the net assets of the Portfolio (computed in the manner
set forth in the Fund's Declaration of Trust or other organizational
document) determined as of the close of business on each business day
throughout the month. The resulting dollar amount comprises the Basic
Fee.
(c) Performance Adjustment Rate: ((This sub-paragraph (c) will be in
effect only through the last calendar day of the 18 calendar month
period beginning on the date that this amended Contract takes effect,
and will have no force or effect thereafter.)) The Performance
Adjustment Rate is 0.02% for each percentage point (the performance of
the Portfolio and the Index each being calculated to the nearest
0.01%) that the Portfolio's investment performance for the performance
period was [better or] worse than the record of the Index as then
constituted. The maximum ((negative)) performance adjustment rate is
((-))0.20%.
The performance period will commence with the first day of the first
full month following the Portfolio's commencement of operations.
During the first eleven months of the performance period for the
Portfolio, there will be no performance adjustment. Starting with the
twelfth month of the performance period, the performance adjustment
will take effect. Following the twelfth month a new month will be
added to the performance period until the performance period equals 36
months. Thereafter the performance period will consist of the current
month plus the previous 35 months.
The Portfolio's investment performance for the period shall be the
cumulative monthly asset-weighted investment performance of all
classes of shares of the Portfolio over the performance period. The
asset-weighted investment performance for the Portfolio for a given
month will be calculated by multiplying the investment performance of
each class for that month by its average net assets (determined as of
the close of business on each business day of the month), adding the
results together and dividing the sum by the aggregate net assets of
all classes of the Portfolio for that month. Any class that does not
complete a full month of operations in a given month will be excluded
from the calculation of the Portfolio's investment performance for
that month, and its assets will be excluded from the aggregate net
assets of the Portfolio in determining the Portfolio's investment
performance for that month.
The investment performance of each class will be measured by
comparing (i) the opening net asset value of one share of the class on
the first business day of the month with (ii) the closing net asset
value of one share of the class as of the last business day of the
month. In computing the investment performance of each class and the
investment record of the Index, distributions of realized capital
gains, the value of capital gains taxes per share paid or payable on
undistributed realized long-term capital gains accumulated to the end
of such period and dividends paid out of investment income on the part
of the Portfolio, and all cash distributions of the securities
included in the Index, will be treated as reinvested in accordance
with Rule 205-1 or any other applicable rules under the Investment
Advisers Act of 1940, as the same from time to time may be amended.
Although the investment performance of the Portfolio for the
performance period shall be rounded to the nearest 0.01%, this shall
not prevent the monthly investment performance of the classes or of
the Portfolio from being rounded to a greater number of decimal
places.
(d) Performance Adjustment. One-twelfth of the annual Performance
Adjustment Rate will be applied to the average net assets of the
Portfolio (computed in the manner set forth in the Fund's Declaration
of Trust or other organizational document) determined as of the close
of business on each business day throughout the month and the
performance period. ((No Performance Adjustment will be made after the
last calendar day of the 18 calendar month period beginning on the
date that this amended Contract takes effect.))
(e) In case of termination of this Contract during any month, the
fee for that month shall be reduced proportionately on the basis of
the number of business days during which it is in effect for that
month. The Basic Fee Rate will be computed on the basis of and applied
to net assets averaged over that month ending on the last business day
on which this Contract is in effect. ((While the Performance
Adjustment is in effect,)) [T]((t))he amount of [this] ((the))
Performance Adjustment to the Basic Fee will be computed on the basis
of and applied to net assets averaged over the 36-month period ending
on the last business day on which this Contract is in effect provided
that if this Contract has been in effect less than 36 months, the
computation will be made on the basis of the period of time during
which it has been in effect.
4. It is understood that the Portfolio will pay all its expenses,
which expenses payable by the Portfolio shall include, without
limitation, (i) interest and taxes; (ii) brokerage commissions and
other costs in connection with the purchase or sale of securities and
other investment instruments; (iii) fees and expenses of the Fund's
Trustees other than those who are "interested persons" of the Fund or
the Adviser; (iv) legal and audit expenses; (v) custodian, registrar
and transfer agent fees and expenses; (vi) fees and expenses related
to the registration and qualification of the Fund and the Portfolio's
shares for distribution under state and federal securities laws; (vii)
expenses of printing and mailing reports and notices and proxy
material to shareholders of the Portfolio; (viii) all other expenses
incidental to holding meetings of the Portfolio's shareholders,
including proxy solicitations therefor; (ix) a pro rata share, based
on relative net assets of the Portfolio and other registered
investment companies having Advisory and Service or Management
Contracts with the Adviser, of 50% of insurance premiums for fidelity
and other coverage; (x) its proportionate share of association
membership dues; (xi) expenses of typesetting for printing
Prospectuses and Statements of Additional Information and supplements
thereto; (xii) expenses of printing and mailing Prospectuses and
Statements of Additional Information and supplements thereto sent to
existing shareholders; and (xiii) such non-recurring or extraordinary
expenses as may arise, including those relating to actions, suits or
proceedings to which the Portfolio is a party and the legal obligation
which the Portfolio may have to indemnify the Fund's Trustees and
officers with respect thereto.
5. The services of the Adviser to the Portfolio are not to be deemed
exclusive, the Adviser being free to render services to others and
engage in other activities, provided, however, that such other
services and activities do not, during the term of this Contract,
interfere, in a material manner, with the Adviser's ability to meet
all of its obligations with respect to rendering services to the
Portfolio hereunder. In the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Adviser, the Adviser shall not be subject
to liability to the Portfolio or to any shareholder of the Portfolio
for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the
purchase, holding or sale of any security or other investment
instrument.
6. (a) Subject to prior termination as provided in sub-paragraph (d)
of this paragraph 6, this Contract shall continue in force until July
31, [1998] ((2000)) and indefinitely thereafter, but only so long as
the continuance after such date shall be specifically approved at
least annually by vote of the Trustees of the Fund or by vote of a
majority of the outstanding voting securities of the Portfolio.
(b) This Contract may be modified by mutual consent[, such consent
on the part of the Fund to be authorized by vote of a majority of the
outstanding voting securities of 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 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 [Securities and Exchange] 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.
[SIGNATURE LINES OMITTED]
EXHIBIT 2
FUNDS ADVISED BY FMR - TABLE OF AVERAGE NET ASSETS AND EXPENSE RATIOS
(A)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
INVESTMENT OBJECTIVE AND FUND FISCAL YEAR END (A) AVERAGE NET ASSETS RATIO OF NET ADVISORY FEES
(MILLIONS)(B) TO AVERAGE NET ASSETS PAID
TO FMR (C)
GROWTH
Select Portfolios:
Air Transportation ((pound)) 2/28/98 $ 62.7 0.60%
Automotive ((pound)) 2/28/98 62.2 0.59
Biotechnology ((pound)) 2/28/98 577.4 0.60
Brokerage and Investment 2/28/98 416.4 0.60
Management ((pound))
Business Services and 2/28/99 60.7 0.60(bold italic B)
Outsourcing ((pound)) **
Chemicals ((pound)) 2/28/98 83.4 0.60
Computers ((pound)) 2/28/98 658.0 0.60
Construction and Housing 2/28/98 26.0 0.60
((pound))
Consumer Industries ((pound)) 2/28/98 26.5 0.61
Cyclical Industries ((pound)) 2/28/98 3.6 0.00*
Defense and Aerospace 2/28/98 63.9 0.60
((pound))
Developing Communications 2/28/98 238.7 0.60
((pound))
Electronics ((pound)) 2/28/98 2,374.6 0.60
Energy ((pound)) 2/28/98 191.3 0.59
Energy Service ((pound)) 2/28/98 964.1 0.59
Environmental Services 2/28/98 27.8 0.60
((pound))
Financial Services ((pound)) 2/28/98 468.5 0.60
Food and Agriculture ((pound)) 2/28/98 247.0 0.60
Gold ((pound)) 2/28/98 279.5 0.60
Health Care ((pound)) 2/28/98 1,590.8 0.60
Home Finance ((pound)) 2/28/98 1,334.7 0.60
Industrial Equipment ((pound)) 2/28/98 60.1 0.60
Industrial Materials ((pound)) 2/28/98 29.9 0.60
Insurance ((pound)) 2/28/98 110.4 0.60
Leisure ((pound)) 2/28/98 142.1 0.60
Medical Delivery ((pound)) 2/28/98 159.1 0.60
Medical Equipment and 2/28/99 22.2 0.60(bold italic B)
Systems ((pound)) **
Multimedia ((pound)) 2/28/98 59.1 0.60
Select Portfolios: - continued
Natural Gas ((pound)) 2/28/98 $ 82.3 0.59%
Natural Resources ((pound)) 2/28/98 6.4 0.00*
Paper and Forest Products 2/28/98 24.2 0.60
((pound))
Precious Metals and 2/28/98 194.7 0.60
Minerals ((pound))
Regional Banks ((pound)) 2/28/98 1,035.6 0.60
Retailing ((pound)) 2/28/98 152.9 0.60
Software and Computer 2/28/98 434.9 0.60
Services ((pound))
Technology ((pound)) 2/28/98 552.2 0.60
Telecommunications ((pound)) 2/28/98 413.4 0.60
Transportation ((pound)) 2/28/98 57.4 0.59
Utilities Growth ((pound)) 2/28/98 273.5 0.60
Magellan ((pound)) 3/31/98 61,521.2 0.43
Large Cap Stock ((pound)) 4/30/98 133.9 0.45
Mid Cap Stock ((pound)) 4/30/98 1,579.2 0.60
Small Cap Selector ((pound)) 4/30/98 727.3 0.67
Small Cap Stock ((pound))** 4/30/98 383.2 0.69*(bold italic B)
Contrafund II ((pound)) 6/30/98 226.3 0.59
Fidelity Fifty ((pound)) 6/30/98 180.5 0.43
Advisor Focus Funds:
Consumer Industries: ((pound))
Class A 7/31/98 1.3 0.59
Class T 7/31/98 10.7 0.59
Class B 7/31/98 2.2 0.59
Class C 7/31/98 0.5 0.59
Institutional Class 7/31/98 2.7 0.59
Cyclical Industries: ((pound))
Class A 7/31/98 0.4 0.59
Class T 7/31/98 2.7 0.59
Class B 7/31/98 0.5 0.59
Class C 7/31/98 0.1 0.59
Institutional Class 7/31/98 1.5 0.59
Advisor Focus Funds: -
continued
Financial Services: ((pound))
Class A 7/31/98 $ 12.6 0.59%
Class T 7/31/98 82.7 0.59
Class B 7/31/98 30.1 0.59
Class C 7/31/98 8.3 0.59
Institutional Class 7/31/98 3.9 0.59
Health Care: ((pound))
Class A 7/31/98 10.5 0.59
Class T 7/31/98 79.2 0.59
Class B 7/31/98 22.1 0.59
Class C 7/31/98 6.5 0.59
Institutional Class 7/31/98 7.1 0.59
Natural Resources: ((pound))
Class A 7/31/98 6.9 0.59
Class T 7/31/98 499.5 0.59
Class B 7/31/98 54.7 0.59
Class C 7/31/98 1.6 0.59
Institutional Class 7/31/98 6.2 0.59
Technology: ((pound))
Class A 7/31/98 11.7 0.59
Class T 7/31/98 76.3 0.59
Class B 7/31/98 17.6 0.59
Class C 7/31/98 3.0 0.59
Institutional Class 7/31/98 5.2 0.59
Utilities Growth: ((pound))
Class A 7/31/98 1.4 0.59
Class T 7/31/98 13.9 0.59
Class B 7/31/98 5.9 0.59
Class C 7/31/98 1.6 0.59
Institutional Class 7/31/98 3.7 0.59
Blue Chip Growth ((pound)) 7/31/98 14,487.5 0.47
Dividend Growth ((pound)) 7/31/98 5,316.4 0.65
Low-Priced Stock ((pound)) 7/31/98 10,834.5 0.74
OTC Portfolio ((pound)) 7/31/98 4,213.9 0.50
Export and Multinational Fund 8/31/98 $ 468.9 0.59%
((pound))
Destiny I ((pound)) 9/30/98 6,399.7 0.31
Destiny II ((pound)) 9/30/98 4,058.8 0.45
Advisor Diversified
International (rex-all) **
Class A 10/31/99 1.1 0.74(bold italic B)
Class T 10/31/99 1.5 0.74(bold italic B)
Class B 10/31/99 1.1 0.74(bold italic B)
Class C 10/31/99 1.1 0.74(bold italic B)
Institutional Class 10/31/99 1.0 0.74(bold italic B)
Advisor Europe Capital
Appreciation (rex-all) **
Class A 10/31/99 0.5 0.74(bold italic B)
Class T 10/31/99 2.1 0.74(bold italic B)
Class B 10/31/99 0.7 0.74(bold italic B)
Class C 10/31/99 0.8 0.74(bold italic B)
Institutional Class 10/31/99 0.4 0.74(bold italic B)
Advisor Global Equity
(rex-all) **
Class A 10/31/99 1.1 0.74(bold italic B)
Class T 10/31/99 1.2 0.74(bold italic B)
Class B 10/31/99 1.1 0.74(bold italic B)
Class C 10/31/99 1.1 0.74(bold italic B)
Institutional Class 10/31/99 1.1 0.74(bold italic B)
Advisor International Capital
Appreciation: (rex-all) **
Class A 10/31/98 0.6 0.73(dagger)
Class T 10/31/98 6.9 0.73(dagger)
Class B 10/31/98 2.3 0.73(dagger)
Class C 10/31/98 1.3 0.73(dagger)
Institutional Class 10/31/98 5.0 0.73(dagger)
Advisor Japan (rex-all) **
Class A 10/31/99 0.4 0.74(bold italic B)
Class T 10/31/99 0.4 0.74(bold italic B)
Class B 10/31/99 0.4 0.74(bold italic B)
Class C 10/31/99 0.4 0.74(bold italic B)
Institutional Class 10/31/99 0.4 0.74(bold italic B)
Advisor Latin America
(rex-all) **
Class A 10/31/99 $ 0.4 0.74(bold italic B)%
Class T 10/31/99 0.4 0.74(bold italic B)
Class B 10/31/99 0.4 0.74(bold italic B)
Class C 10/31/99 0.4 0.74(bold italic B)
Institutional Class 10/31/99 0.4 0.74(bold italic B)
Advisor Overseas: ((epslon))
Class A 10/31/98 8.5 0.89
Class T 10/31/98 1,159.5 0.89
Class B 10/31/98 51.9 0.89
Class C 10/31/98 6.1 0.89
Institutional Class 10/31/98 47.3 0.89
Canada ((epslon)) 10/31/98 71.9 0.30
Capital Appreciation ((pound)) 10/31/98 2,379.7 0.44
Disciplined Equity ((pound)) 10/31/98 2,857.4 0.43
Diversified International 10/31/98 1,849.8 0.83
((epslon))
Emerging Markets ((epslon)) 10/31/98 390.9 0.74
Europe ((epslon)) 10/31/98 1,399.6 0.73
Europe Capital Appreciation 10/31/98 594.4 0.72
((epslon))
France ((epslon)) 10/31/98 12.5 0.73
Germany ((epslon)) 10/31/98 23.7 0.73
Hong Kong and China (rex-all) 10/31/98 154.3 0.74
International Value (rex-all) 10/31/98 454.5 0.82
Japan (rex-all) 10/31/98 238.4 1.01
Japan Small Companies (rex-all) 10/31/98 95.1 0.74
Latin America ((epslon)) 10/31/98 594.2 0.75
Nordic ((epslon)) 10/31/98 104.3 0.74
Overseas ((epslon)) 10/31/98 3,862.7 0.90
Pacific Basin (rex-all) 10/31/98 206.8 1.11
Southeast Asia (rex-all) 10/31/98 235.6 1.16
Stock Selector ((pound)) 10/31/98 1,885.4 0.43
TechnoQuant Growth 10/31/98 67.4 0.39
United Kingdom ((epslon)) 10/31/98 7.5 0.74
Value ((pound)) 10/31/98 7,451.9 0.41
Worldwide ((epslon)) 10/31/98 1,169.1 0.74
Advisor Dividend Growth
((pound))**
Class A 11/30/99 $ 0.5 0.59(bold italic B)%
Class T 11/30/99 5.1 0.59(bold italic B)
Class B 11/30/99 3.4 0.59(bold italic B)
Class C 11/30/99 1.2 0.59(bold italic B)
Institutional Class 11/30/99 0.9 0.59(bold italic B)
Advisor Equity Growth:
((pound))
Class A 11/30/98 56.8 0.59
Class T 11/30/98 4,568.3 0.59
Class B 11/30/98 166.9 0.59
Class C 11/30/98 26.0 0.59
Institutional Class 11/30/98 1,004.7 0.59
Advisor Growth
Opportunities:((pound))
Class A 11/30/98 255.0 0.46
Class T 11/30/98 22,748.7 0.46
Class B 11/30/98 925.6 0.46
Class C 11/30/98 146.1 0.46
Institutional Class 11/30/98 493.0 0.46
Advisor Large Cap: ((pound))
Class A 11/30/98 3.1 0.59
Class T 11/30/98 59.5 0.59
Class B 11/30/98 27.5 0.59
Class C 11/30/98 1.5 0.59
Institutional Class 11/30/98 7.7 0.59
Advisor Mid Cap: ((pound))
Class A 11/30/98 8.2 0.59
Class T 11/30/98 357.3 0.59
Class B 11/30/98 73.2 0.59
Class C 11/30/98 6.5 0.59
Institutional Class 11/30/98 35.4 0.59
Advisor Retirement Growth
((pound))**
Class A 11/30/99 0.2 0.59(bold italic B)
Class T 11/30/99 0.5 0.59(bold italic B)
Class B 11/30/99 0.2 0.59(bold italic B)
Class C 11/30/99 0.2 0.59(bold italic B)
Institutional Class 11/30/99 0.2 0.59(bold italic B)
Advisor Small Cap: ((pound))**
Class A 11/30/98 $ 4.2 0.74(bold italic B)%
Class T 11/30/98 30.2 0.74(bold italic B)
Class B 11/30/98 9.5 0.74(bold italic B)
Class C 11/30/98 9.4 0.74(bold italic B)
Institutional Class 11/30/98 8.2 0.74(bold italic B)
Advisor Strategic
Opportunities: ((pound))
Class A 11/30/98 3.5 0.38%
Class T 11/30/98 491.8 0.38
Class B 11/30/98 109.5 0.38
Initial Class 11/30/98 20.2 0.38
Institutional Class 11/30/98 4.7 0.38
Advisor TechnoQuant Growth:
((pound))
Class A 11/30/98 3.8 0.59
Class T 11/30/98 18.3 0.59
Class B 11/30/98 11.6 0.59
Class C 11/30/98 0.3 0.59
Institutional Class 11/30/98 1.3 0.59
Emerging Growth ((pound)) 11/30/98 2,172.0 0.79
Growth Company ((pound)) 11/30/98 10,377.6 0.42
New Millennium ((pound)) 11/30/98 1,525.9 0.62
Retirement Growth ((pound)) 11/30/98 4,376.5 0.40
Contrafund ((pound)) 12/31/98 33,442.4 0.45
Trend ((pound)) 12/31/98 1,354.1 0.39
Variable Insurance Products:
Growth
Initial Class 12/31/98 9,027.5 0.59
Service Class 12/31/98 50.6 0.59
Overseas ((epslon))
Initial Class 12/31/98 2,073.3 0.74
Service Class 12/31/98 15.9 0.74
Variable Insurance Products II:
Asset Manager: Growth
((pound))
Initial Class 12/31/98 $ 495.2 0.59%
Service Class 12/31/98 1.1 0.59
Contrafund ((pound))
Initial Class 12/31/98 4,974.2 0.59
Service Class 12/31/98 61.3 0.59
Variable Insurance Products
III:
Growth Opportunities ((pound))
Initial Class 12/31/98 1,296.4 0.59
Service Class 12/31/98 66.4 0.59
Mid Cap ((pound))**
Initial Class 12/31/98 0.5 .59(bold italic B)
Service Class 12/31/98 0.5 .59(bold italic B)
</TABLE>
(a) All fund data are as of the fiscal year end noted in the chart
or as of January 31, 1999, if fiscal year end figures are not yet
available.
(b) Average net assets are computed on the basis of average net
assets of each fund or class at the close of business on each business
day throughout its fiscal period.
(c) Reflects reductions for any expense reimbursement paid by or
due from FMR pursuant to voluntary or state expense limitations. Funds
so affected are indicated by an (*). The ratio for certain multi-class
funds is presented gross of expense reductions for presentation
purposes.
(dagger) Annualized
** Less than a complete fiscal year
(bold italic B) Based on estimated expenses for the first year
(rex-all) Fidelity Management & Research Company (FMR) has entered
into sub-advisory agreements with the following affiliates: Fidelity
Management & Research (U.K.) Inc. (FMR U.K.), Fidelity Management &
Research (Far East) Inc. (FMR Far East), Fidelity Investments Japan
Ltd. (FIJ), Fidelity International Investment Advisors (FIIA), and
Fidelity International Investment Advisors (U.K.) Limited (FIIA (U.K.)
L), with respect to the fund.
((epslon)) FMR has entered into sub-advisory agreements with the
following affiliates: FMR U.K., FMR Far East, FIIA, and FIIA (U.K.) L,
with respect to the fund.
((pound)) FMR has entered into sub-advisory agreements with FMR
U.K. and FMR Far East, with respect to the fund.
ADVI-pxs-0499 CUSIP#315920868/FUND#266
1.717501.100 CUSIP#315920306/FUND#608
CUSIP#315918300/FUND#174
CUSIP#315920884/FUND#694
CUSIP#316401108/FUND#014
Vote this proxy card TODAY! Your prompt response will
save the expense of additional mailings.
RETURN THE PROXY CARD IN THE ENCLOSED ENVELOPE OR MAIL TO:
FIDELITY INVESTMENTS
Proxy Department
P.O. Box 9107
Hingham, MA 02043-9848
PLEASE DETACH AT PERFORATION BEFORE MAILING.
- ----------------------------------------------------------------------
FIDELITY ADVISOR SERIES I: FIDELITY ADVISOR STRATEGIC OPPORTUNITIES
FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward
C. Johnson 3d, Thomas R. Williams, and Eric D. Roiter, or any one or
more of them, attorneys, with full power of substitution, to vote all
shares of FIDELITY ADVISOR SERIES I: FIDELITY ADVISOR STRATEGIC
OPPORTUNITIES FUND which the undersigned is entitled to vote at the
Special Meeting of Shareholders of the fund to be held at the office
of the trust at 82 Devonshire St., Boston, MA 02109, on June 16, 1999
at 10 :00 a.m. Eastern time and at any adjournments thereof.
All powers may be exercised by a majority of said proxy holders or
substitutes voting or acting or, if only one votes and acts, then by
that one. This Proxy shall be voted on the proposals described in the
Proxy Statement as specified on the reverse side. Receipt of the
Notice of the Meeting and the accompanying Proxy Statement is hereby
acknowledged.
Date , 1999
NOTE: Please sign exactly as your name appears on this Proxy. When
signing in a fiduciary capacity, such as executor, administrator,
trustee, attorney, guardian, etc., please so indicate. Corporate and
partnership proxies should be signed by an authorized person
indicating the person's title.
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
(014, 174, 266, 608, 694)
Please refer to the Proxy Statement discussion of each of these
matters.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE
PROPOSALS.
As to any other matter, said attorneys shall vote in accordance with
their best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR EACH OF THE FOLLOWING:
Please fold and detach card at perforation before mailing.
- ----------------------------------------------------------------------
PLEASE VOTE BY FILLING IN A BOX BELOW.
______________________________________________________________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
1(a). To eliminate certain FOR [ ] AGAINST [ ] ABSTAIN [ ] 1(a).
fundamental investment
policies of the fund.
Approval of Proposal 1(a) is
contingent upon approval of
Proposal 1(b).
1(b). To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 1(b).
management contract for the
fund. Approval of Proposal
1(b) is contingent upon
approval of Proposal 1(a).
</TABLE>
ADVI-pxc-0499 cusip # 315920868/fund #266
cusip # 315920306/fund #608
cusip # 315918300/fund #174
cusip # 315920884/fund #694
cusip # 316401108/fund #014
Dear Fidelity Advisor Strategic Opportunities Fund Shareholder:
On June 16, 1999, there will be a special meeting of shareholders of
Fidelity Advisor Strategic Opportunities Fund.
The matters to be discussed are important, and directly affect your
investment. As a shareholder, the number of votes you are entitled to
is based upon the dollar value of your investment. YOU MAY THINK YOUR
VOTE IS INSIGNIFICANT, BUT EVERY VOTE IS EXTREMELY IMPORTANT. We must
continue sending requests to vote until a majority of the shares are
voted prior to the meeting. Additional mailings are expensive, and
these costs are charged directly to the fund.
The enclosed Proxy Statement details the proposals under
consideration. A list of the proposals can be found on the cover of
the Proxy Statement. In addition, we have attached a Q&A to assist
you in understanding the proposals that require your vote. After you
have read the material, please cast your vote promptly by signing and
returning the enclosed proxy card. It is important that you sign the
proxy card exactly as your name appears in the account registration.
A postage-paid envelope has been provided. Your time will be well
spent, and you will help save the cost of the additional mailings.
These proposals have been carefully considered by the fund's Board of
Trustees, which is responsible for protecting your interests as a
shareholder. THE BOARD OF TRUSTEES BELIEVES THESE PROPOSALS ARE FAIR
AND REASONABLE, AND RECOMMENDS THAT YOU APPROVE THEM. If you have any
questions about any of the proposals, please do not hesitate to call
1-800-522-7297 if you purchased your shares through a financial
intermediary or a financial institution, or 1-800-544-8888 if you
purchased your shares directly from Fidelity.
Remember, this is your opportunity to voice your opinion on matters
affecting your fund. YOUR PARTICIPATION IS EXTREMELY IMPORTANT NO
MATTER HOW MANY OR HOW FEW SHARES YOU OWN.
Thank you. We appreciate your prompt attention.
Sincerely,
/s/Edward C. Johnson 3d
Edward C. Johnson 3d
Chairman and Chief Executive Officer
Q&A
IMPORTANT INFORMATION TO
HELP YOU UNDERSTAND THE
PROPOSALS THAT YOU
ARE BEING ASKED TO VOTE ON.
PLEASE READ THE FULL TEXT OF THE PROXY STATEMENT. BELOW IS A BRIEF
OVERVIEW OF THE MATTERS TO BE VOTED UPON. YOUR VOTE IS IMPORTANT. IF
YOU HAVE ANY QUESTIONS REGARDING ANY OF THE PROPOSALS, PLEASE CALL
1-800-522-7297 IF YOU PURCHASED YOUR SHARES THROUGH A FINANCIAL
INTERMEDIARY OR A FINANCIAL INSTITUTION, OR 1-800-544-8888 IF YOU
PURCHASED YOUR SHARES DIRECTLY FROM FIDELITY. WE APPRECIATE YOU
PLACING YOUR TRUST IN THE FIDELITY ADVISOR STRATEGIC OPPORTUNITIES
FUND AND LOOK FORWARD TO HELPING YOU ACHIEVE YOUR FINANCIAL GOALS.
Q. WHY IS THE FUND PROPOSING TO ELIMINATE CERTAIN OF ITS FUNDAMENTAL
INVESTMENT POLICIES? (PROPOSAL 1(A))
A. Although the fund's current fundamental investment policies do not
specify a particular investment style or market capitalization, the
fund's holdings have tended to be value stocks with significantly
smaller market capitalizations than the broad market. If approved,
the proposal will allow the fund to be defined more clearly in the
future as a value fund that focuses on medium-sized companies. The
Trustees intend to change the fund's name to "Fidelity Advisor Value
Strategies Fund" if the proposal is approved to better reflect the
fund's investment style. The fund's investment objective of capital
appreciation will not change.
Q. WHY IS THE FUND PROPOSING TO AMEND ITS MANAGEMENT CONTRACT TO
ELIMINATE THE PERFORMANCE ADJUSTMENT TO THE FUND'S MANAGEMENT FEE?
(PROPOSAL 1(B))
A. If proposal 1(a) is approved, FMR intends to focus the fund's
investments on value stocks. FMR also intends to focus the fund's
investments on securities of medium-sized companies. The Standard &
Poor's 500 Index (S&P 500) - the index used to calculate the fund's
performance adjustment under the present contract - is a broad measure
of the performance of the overall U.S. stock market and includes both
"growth" stocks and "value" stocks. The S&P 500 also has a
significantly higher average market capitalization than the fund. If
proposal 1(a) is approved, the S&P 500 no longer will be an
appropriate benchmark for the fund. FMR considered whether to
recommend changing the performance adjustment index from the S&P 500
to a more narrowly-based index, but determined instead to recommend
eliminating the performance adjustment due to the difficulties of
calculating performance adjustments for multiple class funds, such as
the fund.
Q. IF THE AMENDED MANAGEMENT CONTRACT IS APPROVED, WHEN WILL THE
PERFORMANCE ADJUSTMENT BE ELIMINATED AND WHAT IMPACT WILL ELIMINATING
THE PERFORMANCE ADJUSTMENT HAVE ON THE FUND'S MANAGEMENT FEE?
(PROPOSAL 1(B))
A. If the proposal is approved, FMR will continue to calculate the
performance adjustment on the fund for an 18 month "phase-out" period.
During this period, FMR will not receive any positive performance
adjustments but instead will receive the lower of the basic management
fee or the basic management fee less any negative performance
adjustments. Thus, during this phase-out period, the performance
adjustment can decrease, but not increase, the management fee owed by
the fund. During this phase-out period, FMR will continue to use the
S&P 500 for performance fee calculations. The future impact of
eliminating the performance adjustment will depend on many different
factors and may represent an increase or a decrease from the fund's
aggregate management fee under the present contract.
Q. WHAT HAPPENS IF ONLY ONE OF THE TWO PROPOSALS IN THE PROXY
STATEMENT IS APPROVED?
A. Proposals 1(a) and 1(b) are contingent upon each other. Neither
proposal will be implemented unless both proposals are approved.
Q. HAS THE FUND'S BOARD OF TRUSTEES APPROVED BOTH PROPOSALS?
A. The Board of Trustees of the fund has unanimously approved both
proposals and recommends that you vote to approve them.
Q. HOW MANY VOTES AM I ENTITLED TO CAST?
A. As a shareholder, you are entitled to one vote for each dollar of
net asset value you own of the fund on the record date. The record
date is April 19, 1999.
Q. HOW DO I VOTE MY SHARES?
A. You can vote your shares by completing and signing the enclosed
proxy card, and mailing it in the enclosed postage paid envelope. If
you need any assistance, or have any questions regarding the proposals
or how to vote your shares, please do not hesitate to call
1-800-522-7297 if you purchased your shares through a financial
intermediary or a financial institution, or 1-800-544-8888 if you
purchased your shares directly from Fidelity.
Q. HOW DO I SIGN THE PROXY CARD?
A.INDIVIDUAL ACCOUNTS: Shareholders should sign exactly as their
names appear on the account registration shown on the card.
JOINT ACCOUNTS: Either owner may sign, but the name of the person
signing should conform exactly to a name shown in the registration.
ALL OTHER ACCOUNTS: The person signing must indicate his or her
capacity. For example, a trustee for a trust or other entity should
sign, "Ann B. Collins,Trustee."
FIDELITY
INVESTMENTS
INSTITUTIONAL
SERVICES
COMPANY, INC.
IMPORTANT PROXY MATERIALS ARE ON THE WAY TO YOUR CLIENTS RIGHT NOW.
April 19, 1999
Dear Investment Professional:
On Wednesday, June 16, 1999, there will be a Special Meeting of
Shareholders of Fidelity Advisor Strategic Opportunities Fund.
The enclosed Proxy Statement details the proposals pertaining to this
fund. We also have enclosed a copy of the letter that is being mailed
to your clients who hold shares in this fund.
In addition, we have enclosed a Q&A to assist you in understanding the
proposals that require voting. If you have any questions about this
proxy after reading this letter, Proxy Statement and Q&A, please call
800-522-7297.
We appreciate your support and look forward to serving you in any way
we can.
Sincerely,
/s/ Daniel T. Geraci
Daniel T. Geraci
Executive Vice President
This letter is intended for investment professional use only, and may
not be reproduced or shown to the public in oral or written form as
sales material.
Fidelity Advisor Funds(Registered trademark) is a registered service
mark of FMR Corp. Fidelity and Fidelity Investments are registered
trademarks of FMR Corp.
[graphic - Fidelity Investments & (Pyramid) Design (registered)]
Fidelity Investments Institutional Services Company, Inc., 82
Devonshire Street, Boston, MA 02109
