SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
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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
</TABLE>
Fidelity Investment Trust
Arthur S. Loring, Secretary
Payment of Filing Fee (Check the appropriate box):
[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
transaction applies:
(2) Aggregate number of securities to which
transaction applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
(5) Total Fee Paid:
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<CAPTION>
<S> <C>
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a) (2)
and identify the filing for which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form or Schedule and the date of
its filing.
</TABLE>
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
FIDELITY DIVERSIFIED INTERNATIONAL FUND
FIDELITY EUROPE CAPITAL APPRECIATION FUND
FIDELITY FRANCE FUND
FIDELITY GERMANY FUND
FIDELITY HONG KONG AND CHINA FUND
FIDELITY INTERNATIONAL VALUE FUND
FIDELITY JAPAN FUND
FIDELITY JAPAN SMALL COMPANIES FUND
FIDELITY LATIN AMERICA FUND
FIDELITY NORDIC FUND
FIDELITY SOUTHEAST ASIA FUND
FIDELITY UNITED KINGDOM FUND
FUNDS OF
FIDELITY INVESTMENT TRUST
82 DEVONSHIRE STREET, BOSTON, MASSACHUSETTS 02109
1-800-544-8888
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To the Shareholders of the above funds:
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders (the
Meeting) of Fidelity Diversified International Fund, Fidelity Europe
Capital Appreciation Fund, Fidelity France Fund, Fidelity Germany Fund,
Fidelity Hong Kong and China Fund, Fidelity International Value Fund,
Fidelity Japan Fund, Fidelity Japan Small Companies Fund, Fidelity Latin
America Fund, Fidelity Nordic Fund, Fidelity Southeast Asia Fund, and
Fidelity United Kingdom Fund (the funds), will be held at the office of
Fidelity Investment Trust (the trust), 82 Devonshire Street, Boston,
Massachusetts 02109 on Wednesday, September 17, 1997, at 9:45 a.m. Eastern
time. 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. To elect a Board of Trustees.
2. To ratify the selection of Coopers & Lybrand L.L.P. and Price
Waterhouse LLP as independent accountants of the trust.
3. To amend the Declaration of Trust to provide dollar-based voting rights
for shareholders of the trust.
4. To amend the Declaration of Trust regarding shareholder notification of
appointment of Trustees.
5. To amend the Declaration of Trust to provide each fund with the ability
to invest all of its assets in another open-end investment company .
6. To adopt a new fundamental investment policy for Fidelity Diversified
International Fund, Fidelity Europe Capital Appreciation Fund, Fidelity
Japan Fund, Fidelity Latin America Fund , and Fidelity Southeast Asia
Fund to permit these funds to invest all of their assets in another
open-end investment company with substantially the same investment
objective and policies.
7. To approve an amended management contract for Fidelity Diversified
International Fund.
8. To approve an amended management contract for Fidelity International
Value Fund.
9. To approve an amended management contract for Fidelity Europe Capital
Appreciation Fund.
10. To approve an amended management contract for Fidelity Japan Fund.
11. To approve an amended management contract for Fidelity Southeast Asia
Fund.
12. To approve an amended management contract for Fidelity Latin America
Fund.
13. To approve an amended management contract for each of Fidelity
France Fund, Fidelity Germany Fund, Fidelity Hong Kong and China Fund,
Fidelity Japan Small Companies Fund, Fidelity Nordic Fund , and
Fidelity United Kingdom Fund.
14. To approve a new Sub-Advisory Agreement with Fidelity Investments
Japan Limited for Fidelity Diversified International Fund.
15. To approve a Distribution and Service Plan pursuant to Rule 12b-1
for each of Fidelity Diversified International Fund and Fidelity
International Value Fund.
16. To amend Fidelity Diversified International Fund's, Fidelity Europe
Capital Appreciation Fund's, Fidelity International Value Fund's, Fidelity
Japan Fund's, Fidelity Latin America Fund's , and Fidelity Southeast
Asia Fund's fundamental investment limitation concerning
diversification .
The Board of Trustees has fixed the close of business on July 21, 1997 as
the record date for the determination of the shareholders of each of the
funds entitled to notice of, and to vote at, such Meeting and any
adjournments thereof.
By order of the Board of Trustees,
ARTHUR S. LORING, Secretary
July 21, 1997
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 INVESTMENT TRUST:
FIDELITY DIVERSIFIED INTERNATIONAL FUND
FIDELITY EUROPE CAPITAL APPRECIATION FUND
FIDELITY FRANCE FUND
FIDELITY GERMANY FUND
FIDELITY HONG KONG AND CHINA FUND
FIDELITY INTERNATIONAL VALUE FUND
FIDELITY JAPAN FUND
FIDELITY JAPAN SMALL COMPANIES FUND
FIDELITY LATIN AMERICA FUND
FIDELITY NORDIC FUND
FIDELITY SOUTHEAST ASIA FUND
FIDELITY UNITED KINGDOM FUND
TO BE HELD ON SEPTEMBER 17, 1997
This Proxy Statement is furnished in connection with a solicitation of
proxies made by, and on behalf of, the Board of Trustees of Fidelity
Investment Trust (the trust) to be used at the Special Meeting of
Shareholders of Fidelity Diversified International Fund, Fidelity Europe
Capital Appreciation Fund, Fidelity France Fund, Fidelity Germany Fund,
Fidelity Hong Kong and China Fund, Fidelity International Value Fund,
Fidelity Japan Fund, Fidelity Japan Small Companies Fund, Fidelity Latin
America Fund, Fidelity Nordic Fund, Fidelity Southeast Asia Fund, and
Fidelity United Kingdom Fund (the funds) and at any adjournments thereof
(the Meeting), to be held on September 17, 1997 at 9:45 a.m. at 82
Devonshire Street, Boston, Massachusetts 02109, the principal executive
office of the trust and Fidelity Management & Research Company (FMR), the
funds' investment adviser. Shareholders of the trust's other funds
( Fidelity Canada Fund, Fidelity Emerging Markets Fund, Fidelity
Europe Fund, Fidelity Global Bond Fund, Fidelity International Growth
& Income Fund, Fidelity New Markets Income Fund, Fidelity Overseas
Fund, Fidelity Pacific Basin Fund and Fidelity Worldwide Fund ) will
also participate in the Meeting and have been mailed separate
notice s and proxy statement s relating to proposals to be
voted upon by the trust and/or by the shareholders of those funds.
The purpose of the Meeting is set forth in the accompanying Notice. The
solicitation is made primarily by the mailing of this Proxy Statement and
the accompanying proxy card on or about July 21, 1997. Supplementary
solicitations may be made by mail, telephone, telegraph, facsimile, or by
personal interview by representatives of the trust. In addition, Management
Information Services Corp. (MIS) and D.F. King & Co. may be paid on a
per-call basis to solicit shareholders on behalf of the funds at an
anticipated cost of approximately $30,000 (Fidelity Diversified
International Fund ), $18,000 (Fidelity Europe Capital
Appreciation Fund ), $2,000 (Fidelity France Fund), $2,000 (Fidelity
Germany Fund), $13,000 (Fidelity Hong Kong and China Fund), $12,000
(Fidelity International Value Fund), $16,000 (Fidelity Japan Fund), $6,000
(Fidelity Japan Small Companies Fund), $17,000 (Fidelity Latin America
Fund), $6,000 (Fidelity Nordic Fund), $14,000 (Fidelity Southeast Asia
Fund), and $2,000 (Fidelity United Kingdom Fund), respectively. The
expenses in connection with preparing this Proxy Statement and its
enclosures and of all solicitations will be paid by the funds. The funds
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
funds' 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 funds, is 82
Devonshire Street, Boston, Massachusetts 02109. Fidelity Investments Japan
L imi t e d (FIJ), subadviser to Fidelity Hong Kong and China
Fund, Fidelity International Value Fund, Fidelity Japan Fund, Fidelity
Japan Small Companies Fund and Fidelity Southeast Asia Fund, is located at
Shiroyama JT Mori B ldg. , 4-3-1 Toranomon Minato-ku, Tokyo 105,
Japan. Fidelity International Investment Advisors (FIIA), located at
Pembroke Hall, 42 Crow Lane, Pembroke HM19, Bermuda and Fidelity
International Investment Advisors (U.K.) Limited (FIIAL (U.K.) ) ,
located at 26 Lovat Lane, London, England EC3R 8LL, are also
subadvisers to the funds.
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, 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 which 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 funds may also arrange to have votes recorded by telephone. D.F. King
& Co. may be paid on a per call basis for vote-by-phone solicitations on
behalf of the funds at an anticipated cost of approximately $9,000
(Fidelity Diversified International Fund), $4,000 (Fidelity Europe Capital
Appreciation Fund), $500 (Fidelity France Fund), $500 (Fidelity Germany
Fund), $3,000 (Fidelity Hong Kong and China Fund), $3,000 (Fidelity
International Value Fund), $4,000 (Fidelity Japan Fund), $1,000 (Fidelity
Japan Small Companies Fund), $5,000 (Fidelity Latin America Fund), $1,000
(Fidelity Nordic Fund), $4,000 (Fidelity Southeast Asia Fund), and $500
(Fidelity United Kingdom Fund), respectively. The expenses in connection
with telephone voting will be paid by the funds. If the funds record votes
by telephone, they will use procedures designed to authenticate
shareholders' 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.
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 proxies 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 proxies 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 fund of the trust issued and outstanding as of May 31, 1997
are indicated in the following table:
Fidelity Canada Fund 6,891,750
Fidelity Diversified International Fund 73,349,989
Fidelity Emerging Markets Fund 67,449,877
Fidelity Europe Fund 32,358,016
Fidelity Europe Capital Appreciation Fund 25,799,612
Fidelity France Fund 536,487
Fidelity Germany Fund 1,049,684
Fidelity Global Bond Fund 10,184,682
Fidelity Hong Kong and China Fund 14,843,16 1
Fidelity International Growth & Income Fund 52,348,999
Fidelity International Value Fund 23,896,45 5
Fidelity Japan Fund 27,323,208
Fidelity Japan Small Companies Fund 16,108,022
Fidelity Latin America Fund 57,609,713
Fidelity New Markets Income Fund 27,143,293
Fidelity Nordic Fund 5,380,967
Fidelity Overseas Fund 109,779,796
Fidelity Pacific Basin Fund 20,615,287
Fidelity Southeast Asia Fund 37,389,890
Fidelity United Kingdom Fund 452,421
Fidelity Worldwide Fund 64,897,646
To the knowledge of the trust, substantial (5% or more) record or
beneficial ownership of each fund on May 31, 1997 was as follows:
Fidelity Canada Fund - National Financial Services Corporation (NFSC),
Boston, MA (21.93%).
Fidelity Diversified International Fund - NFSC, Boston, MA (11.99%).
Fidelity Europe Capital Appreciation Fund - NFSC, Boston, MA (24.20%).
Fidelity Europe Fund - NFSC, Boston, MA (14.16%).
Fidelity France Fund - FMR Capital, Boston, MA (19.82%); NFSC, Boston, MA
(45.52%).
Fidelity Germany Fund - FMR Capital, Boston, MA (9.86%); NFSC, Boston, MA
(35.61%).
Fidelity Global Bond Fund - NFSC, Boston, MA (5.89%).
Fidelity Hong Kong and China Fund - NFSC, Boston, MA (25.06%).
Fidelity International Growth & Income Fund - NFSC, Boston, MA (11.98%).
Fidelity International Value Fund - NFSC, Boston, MA (28.95%).
Fidelity Japan Fund - Fidelity Management Trust Company (FMTC), Boston, MA
(7.51%); NFSC, Boston, MA (24.16%).
Fidelity Japan Small Companies Fund - FMTC, Boston, MA (18.68%); NFSC,
Boston, MA (19.18%).
Fidelity Latin America Fund - NFSC, Boston, MA (7.71%).
Fidelity New Markets Income Fund - NFSC, Boston, MA (24.28%).
Fidelity Nordic Fund - NFSC, Boston, MA (26.38%).
Fidelity Pacific Basin Fund - NFSC, Boston, MA (6.24%).
Fidelity Southeast Asia Fund - NFSC, Boston, MA (5.50%).
Fidelity United Kingdom Fund - FMR Capital, Boston, MA (22.86%); NFSC,
Boston, MA (46.45%).
FMR Capital has advised the trust that for proposals 1 through 5 and 13
contained in this proxy statement, they will vote their shares at the
Meeting FOR each proposal. FMTC also has advised the trust that for
proposals 1 through 6, 10, 13, and 16 contained in this proxy statement,
they will vote their shares at the Meeting FOR each proposal. To the
knowledge of the trust, no other shareholder owned of record or
beneficially more than 5% of the outstanding shares of any of the funds on
that date.
Shareholders of record at the close of business on July 21, 1997 will be
entitled to vote at the Meeting. Each such shareholder will be entitled to
one vote for each share held on that date.
FOR A FREE COPY OF EACH FUND'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED
OCTOBER 31, 1996 AND THE SEMI A NNUAL REPORT FOR THE FISCAL PERIOD
ENDED APRIL 30, 1997 , CALL 1-800-544-8888 OR WRITE TO FIDELITY
DISTRIBUTORS CORPORATION AT 82 DEVONSHIRE STREET, BOSTON, MASSACHUSETTS
02109.
VOTE REQUIRED: A PLURALITY OF ALL VOTES CAST AT THE MEETING IS SUFFICIENT
TO APPROVE PROPOSALS 1 AND 2. APPROVAL OF PROPOSAL 3 REQUIRES THE
AFFIRMATIVE VOTE OF A "MAJORITY OF THE OUTSTANDING VOTING SECURITIES" OF
BOTH THE TRUST AND OF EACH FUND OF THE TRUST AND, IN THE CASE OF PROPOSALS
4 AND 5 A "MAJORITY OF THE OUTSTANDING VOTING SECURITIES" OF THE ENTIRE
TRUST. APPROVAL OF PROPOSALS 6 THROUGH 16 REQUIRES THE AFFIRMATIVE VOTE OF
A "MAJORITY OF THE OUTSTANDING VOTING SECURITIES" OF THE APPROPRIATE FUNDS.
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.
The following tables summarize the proposals applicable to each fund.
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Proposal Proposal Description Applicable Funds
#
1. To elect as Trustees the 12 nominees presented in proposal 1. All
2. To ratify the selection of Coopers & Lybrand L.L.P. and Price All
Waterhouse LLP as independent accountants of the trust.
3. To amend the Declaration of Trust to provide voting rights based on a All
shareholder's total dollar investment in a fund, rather than on the
number of shares owned.
4. To amend the Declaration of Trust to eliminate the requirement that All
shareholders be notified in the event of an appointment of a trustee
within three months of the appointment.
5. To amend the Declaration of Trust to clarify that the Trustees may All
authorize the investment of all of a fund's assets in another open-end
investment compa n y.
6. To adopt a new fundamental investment policy for the fund that would Fidelity Diversified
permit it to invest all of its assets in another open-end investment International Fund, Fidelity
company managed by FMR or an affiliate with substantially the same Europe Capital Appreciation
investment objective and policies. Fund, Fidelity Japan Fund,
Fidelity Latin America Fund,
and Fidelity Southeast Asia
Fund
7. To approve an amended management contract for the fund that would Fidelity Diversified
reduce the management fee payable to FMR by the fund as FMR's International Fund
assets under management increase and would modify the
performance adjustment calculation to calculate the fund's investment
performance and that of its comparative index to the nearest 0.01%.
Proposal Proposal Description Applicable Funds
#
8. To approve an amended management contract for the fund that would Fidelity International Value
reduce the management fee payable to FMR by the fund as FMR's Fund
assets under management increase and would modify the
performance adjustment calculation to calculate the fund's investment
performance and that of its comparative index to the nearest 0.01%.
9. To approve an amended management contract for the fund that would Fidelity Europe Capital
reduce the management fee payable to FMR by the fund as FMR's Appreciation Fund
assets under management increase and would modify the
performance adjustment calculation to calculate the fund's investment
performance and that of its comparative index to the nearest 0.01%.
10. To approve an amended management contract for the fund that would Fidelity Japan Fund
reduce the management fee payable to FMR by the fund as FMR's
assets under management increase and would modify the
performance adjustment calculation to calculate the fund's investment
performance and that of its comparative index to the nearest 0.01%.
11. To approve an amended management contract for the fund that would Fidelity Southeast Asia Fund
reduce the management fee payable to FMR by the fund as FMR's
assets under management increase and would modify the
performance adjustment calculation to calculate the fund's investment
performance and that of its comparative index to the nearest 0.01%.
12. To approve an amended management contract for the fund that would Fidelity Latin America Fund
reduce the management fee payable to FMR by the fund as FMR's
assets under management increase.
13. To approve an amended management contract for the fund that would Fidelity France Fund,
reduce the management fee payable to FMR by the fund as FMR's Fidelity Germany Fund,
assets under management increase. Fidelity Hong Kong and
China Fund, Fidelity Japan
Small Companies Fund,
Fidelity Nordic Fund , and
Fidelity United Kingdom
Fund
14. To approve a new sub-advisory agreement with Fidelity Investments Fidelity Diversified
Japan L imited to provide investment advice and research services or International Fund
investment management services.
15. To approve a Distribution and Service Plan for the fund which Fidelity Diversified
describes all material aspects of the proposed financing for the International Fund and
distribution of fund shares. Fidelity International Value
Fund
16. To amend the diversification limitation to exclude "securities of other Fidelity Diversified
investment companies" from issuer diversification limits. International Fund, Fidelity
Europe Capital Appreciation
Fund, Fidelity International
Value Fund, Fidelity Japan
Fund, Fidelity Latin America
Fund , and Fidelity Southeast
Asia Fund
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1. TO ELECT A BOARD OF TRUSTEES.
The purpose of this proposal is to elect a Board of Trustees of the Trust.
Pursuant to the provisions of the Declaration of Trust of Fidelity
Investment Trust, the Trustees have determined that the number of Trustees
shall be fixed at twelve. It is intended that the enclosed proxy card will
be voted for the election as Trustees of the twelve nominees listed below,
unless such authority has been withheld in the proxy card.
Except for Robert C. Pozen, a ll nominees named below are currently
Trustees of Fidelity Investment Trust and have served in that capacity
continuously since originally elected or appointed. Phyllis Burke Davis,
Robert M. Gates, Marvin L. Mann, and William O. McCoy were selected by the
trust's Nominating and Administration Committee (see page 19) and were
appointed to the Board in December 1992, March 1997, October 1993, and
January 1997, respectively. None of the nominees are related to one
another. Those nominees indicated by an asterisk (*) are "interested
persons" of the trust by virtue of, among other things, their affiliation
with either the trust, the funds' investment adviser (FMR, or the Adviser),
or the funds' distribution agent, FDC. The business address of each nominee
who is an "interested person" is 82 Devonshire Street, Boston,
Massachusetts 02109, and the business address of all other nominees is
Fidelity Investments, P.O. Box 9235, Boston, Massachusetts 02205-9235.
Except for Robert M. Gates , William O. McCoy and Robert C.
Pozen each of the nominees is currently a Trustee or General Partner,
as the case may be, of 62 registered investment companies (trusts or
partnerships) advised by FMR. Mr. Gates and Mr. McCoy are currently
Trustees or General Partners, as the case may be, of 4 8 registered
investment companies (trusts or partnerships) advised by FMR.
Effective August 1, 1997, Mr. Pozen will be a Trustee or General Partner,
as the case may be, of 48 registered Investment companies (trusts or
partnerships) advised by FMR.
In the election of Trustees, those twelve nominees receiving the highest
number of votes cast at the Meeting, providing a quorum is present, shall
be elected.
<TABLE>
<CAPTION>
Nominee Principal Occupation ** Year of
(Age) Election or
Appointmen
t
<S> <C> <C>
Ralph F. Cox Management consultant (1994). Prior to February 1994, he was President of 1991
(65) Greenhill Petroleum Corporation (petroleum exploration and production). Until
March 1990, Mr. Cox was President and Chief Operating Officer of Union
Pacific Resources Company (exploration and production). He is a Director of
Sanifill Corporation (non-hazardous waste, 1993), CH2M Hill Companies
(engineering), Rio Grande, Inc. (oil and gas production), and Daniel Industries
(petroleum measurement equipment manufacturer). In addition, he is a member
of advisory boards of Texas A&M University and the University of Texas at
Austin.
Phyllis Burke Davis Prior to her retirement in September 1991, Mrs. Davis was the Senior Vice 1992
(65) President of Corporate Affairs of Avon Products, Inc. She is currently a Director
of BellSouth Corporation (telecommunications), Eaton Corporation
(manufacturing, 1991), and the TJX Companies, Inc. (retail stores), and
previously served as a Director of Hallmark Cards, Inc. (1985-1991) and
Nabisco Brands, Inc. In addition, she is a member of the President's Advisory
Council of The University of Vermont School of Business Administration.
Robert M. Gates Consultant, author, and lecturer (1993). Mr. Gates was Director of the Central 1997
(53) Intelligence Agency (CIA) from 1991 - 1993. From 1989 to 1991, Mr. Gates
served as Assistant to the President of the United States and Deputy National
Security Advisor. Mr. Gates is currently a Trustee for the Forum For
International Policy, a Board Member for the Virginia Neurological Institute, and
a Senior Advisor of the Harvard Journal of World Affairs. In addition, Mr. Gates
also serves as a member of the corporate board for Lucas Varity PLC
(automotive components and diesel engines), Charles Stark Draper Laboratory
(non-profit), NACCO Industries, Inc. (mining and manufacturing), and TRW Inc.
(original equipment and replacement products).
*Edward C. Johnson President, is Chairman, Chief Executive Officer and a Director of FMR Corp.; a 1968
3d Director and Chairman of the Board and of the Executive Committee of FMR;
(67) Chairman and a Director of FMR Texas Inc., Fidelity Management & Research
(U.K.) Inc., and Fidelity Management & Research (Far East) Inc.
E. Bradley Jones Prior to his retirement in 1984, Mr. Jones was Chairman and Chief Executive 1990
(69) Officer of LTV Steel Company. He is a Director of TRW Inc. (original equipment
and replacement products), Consolidated Rail Corporation, Birmingham Steel
Corporation, and RPM, Inc. (manufacturer of chemical products), and he
previously served as a Director of NACCO Industries, Inc. (mining and
manufacturing, 1985-1995), Hyster-Yale Materials Handling, Inc. (1985-1995),
and Cleveland-Cliffs Inc . (mining), and as a Trustee of First Union Real Estate
Investments. In addition, he serves as a Trustee of the Cleveland Clinic
Foundation, where he has also been a member of the Executive Committee as
well as Chairman of the Board and President, a Trustee and member of the
Executive Committee of University School (Cleveland), and a Trustee of
Cleveland Clinic Florida.
Donald J. Kirk Executive-in-Residence (1995) at Columbia University Graduate School of 1987
(64) Business and a financial consultant. From 1987 to January 1995, Mr. Kirk was
a Professor at Columbia University Graduate School of Business. Prior to 1987,
he was Chairman of the Financial Accounting Standards Board. Mr. Kirk is a
Director of General Re Corporation (reinsurance), and he previously served as
a Director of Valuation Research Corp. (appraisals and valuations, 1993-1995).
In addition, he serves as Chairman of the Board of Directors of the National
Arts Stabilization Fund, Chairman of the Board of Trustees of the Greenwich
Hospital Association, a Member of the Public Oversight Board of the American
Institute of Certified Public Accountants' SEC Practice Section (1995), and as a
Public Governor of the National Association of Securities Dealers, Inc. (1996).
*Peter S. Lynch Vice Chairman and Director of FMR (1992). Prior to May 31, 1990, he was a 1990
(54) Director of FMR and Executive Vice President of FMR (a position he held until
March 31, 1991); Vice President of Fidelity Magellan Fund and FMR Growth
Group Leader; and Managing Director of FMR Corp. Mr. Lynch was also Vice
President of Fidelity Investments Corporate Services (1991-1992). He is a
Director of W.R. Grace & Co. (chemicals) and Morrison Knudsen Corporation
(engineering and construction). In addition, he serves as a Trustee of Boston
College, Massachusetts Eye & Ear Infirmary, Historic Deerfield (1989) and
Society for the Preservation of New England Antiquities, and as an Overseer of
the Museum of Fine Arts of Boston.
William O. McCoy Vice President of Finance for the University of North Carolina (16-school 1997
(63) system, 1995). Prior to his retirement in December 1994, Mr. McCoy was Vice
Chairman of the Board of BellSouth Corporation (telecommunications , 1984 )
and President of BellSouth Enterprises (1986) . He is currently a Director of
Liberty Corporation (holding company , 1984 ), Weeks Corporation of Atlanta
(real estate, 1994), Carolina Power and Light Company (electric utility, 1996 ),
and the Kenan Transport Co. (1996) . Previously, he was a Director of First
American Corporation (bank holding company, 1979-1996). In addition,
Mr. McCoy serves as a member of the Board of Visitors for the University of
North Carolina at Chapel Hill (1994) and for the Kenan - Flager Business School
(University of North Carolina at Chapel Hill , 1988) .
Gerald C. McDonough Chairman of G.M. Management Group (strategic advisory services). Prior to his 1989
(68) retirement in July 1988, he was Chairman and Chief Executive Officer of
Leaseway Transportation Corp. (physical distribution services). Mr. McDonough is
a Director of Brush-Wellman Inc. (metal refining), York International Corp. (air
conditioning and refrigeration), Commercial Intertech Corp. (hydraulic systems,
building systems, and metal products, 1992), CUNO, Inc. (liquid and gas filtration
products, 1996), and Associated Estates Realty Corporation (a real estate
investment trust, 1993). Mr. McDonough served as a Director of ACME-Cleveland
Corp. (metal working, telecommunications, and electronic products) from
1987-1996.
Marvin L. Mann Chairman of the Board, President, and Chief Executive Officer of Lexmark 1993
(64) International, Inc. (office machines, 1991). Prior to 1991, he held the positions
of Vice President of International Business Machines Corporation ("IBM") and
President and General Manager of various IBM divisions and subsidiaries.
Mr. Mann is a Director of M.A. Hanna Company (chemicals, 1993) and Infomart
(marketing services, 1991), a Trammell Crow Co. In addition, he serves as the
Campaign Vice Chairman of the Tri-State United Way (1993) and is a member
of the University of Alabama President's Cabinet.
*Robert C. Pozen Senior Vice President (effective August 1, 1997), President and a Director of --
(51) FMR (1997); and President and a Director of FMR Texas Inc. (1997), Fidelity
Management & Research (U.K.) Inc. (1997), and Fidelity Management &
Research (Far East) Inc. (1997). Previously, Mr. Pozen served as General
Counsel, Managing Director, and Senior Vice President of FMR Corp.
Thomas R. Williams President of The Wales Group, Inc. (management and financial advisory services). 1989
(6 9 ) Prior to retiring in 1987, Mr. Williams served as Chairman of the Board of First
Wachovia Corporation (bank holding company), and Chairman and Chief
Executive Officer of The First National Bank of Atlanta and First Atlanta
Corporation (bank holding company). He is currently a Director of BellSouth
Corporation (telecommunications), ConAgra, Inc. (agricultural products), Fisher
Business Systems, Inc. (computer software), Georgia Power Company (electric
utility), Gerber Alley & Associates, Inc. (computer software), National Life
Insurance Company of Vermont, American Software, Inc., and AppleSouth, Inc.
(restaurants, 1992).
</TABLE>
_______________
** Except as otherwise indicated, each individual has held the office shown
or other offices in the same company for the last five years.
As of May 31, 1997, the nominees and officers of the trust owned, in
the aggregate, less than 1% of each fund's outstanding shares.
If elected, the Trustees will hold office without limit in time except
that (a) any Trustee may resign; (b) any Trustee may be removed by written
instrument, signed by at least two-thirds of the number of Trustees prior
to such removal; (c) any Trustee who requests to be retired or who has
become incapacitated by illness or injury may be retired by written
instrument signed by a majority of the other Trustees; and (d) a Trustee
may be removed at any Special Meeting of shareholders by a two-thirds vote
of the outstanding voting securities of the trust. In case a vacancy shall
for any reason exist, the remaining Trustees will fill such vacancy by
appointing another Trustee, so long as, immediately after such appointment,
at least two-thirds of the Trustees have been elected by shareholders. If,
at any time, less than a majority of the Trustees holding office has been
elected by the shareholders, the Trustees then in office will promptly call
a shareholders' meeting for the purpose of electing a Board of Trustees.
Otherwise, there will normally be no meeting of shareholders for the
purpose of electing Trustees.
The trust's Board, which is currently composed of three interested and
nine non-interested Trustees, met eleven times during the twelve
months ended October 31, 1996. It is expected that the Trustees will meet
at least ten times a year at regularly scheduled meetings.
The trust's Audit Committee is composed entirely of Trustees who are not
interested persons of the trust, FMR or its affiliates and normally meets
four times a year, or as required, prior to meetings of the Board of
Trustees. Currently, Messrs. Kirk (Chairman), Gates, McCoy and Mrs. Davis
are members of the committee. The committee oversees and monitors the
trust's internal control structure, its auditing function and its financial
reporting process, including the resolution of material reporting issues.
The committee recommends to the Board of Trustees the appointment of
auditors for the trust. It reviews audit plans, fees and other material
arrangements in respect of the engagement of auditors, including non-audit
services to be performed. It reviews the qualifications of key personnel
involved in the foregoing activities. The committee plays an oversight role
in respect of the trust's investment compliance procedures and the code of
ethics. During the twelve months ended October 31, 1996 the committee
held four meetings.
The trust's Nominating and Administration Committee is currently composed
of Messrs. McDonough (Chairman), Jones and Williams . The committee members
confer periodically and hold meetings as required. The committee makes
nominations for independent trustees, and for membership on committees. The
committee periodically reviews procedures and policies of the Board of
Trustees and committees. It acts as the administrative committee under the
Retirement Plan for non-interested trustees who retired prior to December
30, 1996. It monitors the performance of legal counsel employed by the
trust and independent trustees. The committee in the first instance
monitors compliance with, and acts as the administrator of the provisions
of the code of ethics applicable to the independent trustees. During
the twelve months ended October 31, 1996, the committee held four meetings.
The Nominating and Administration Committee will consider nominees
recommended by shareholders. Recommendations should be submitted to the
committee in care of the Secretary of the Trust. The trust does not have a
compensation committee; such matters are considered by the Nominating and
Administration Committee.
1The following table sets forth information describing the compensation of
each Trustee or Member of the Advisory Board of each fund for his or her
services for the fiscal year ended October 31, 1996 or calendar year ended
December 31, 1996, as applicable.
COMPENSATION TABLE
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Aggregate J. Gary Ralph Phyllis Richard Edward E. Donald Peter William Gerald Edward Marvin Thomas
Compensation Burkhead F. Burke J.Flynn C. John- Bradley J. S. O. C. H. L. R.
from a Fund ** Cox Davis *** son 3d Jones Kirk Lynch McCoy McDono Malone Mann Williams
(dagger) ** ** **** ugh ***
Diversified $ 0 $ 158 $ 149 $ 190 $ 0 $ 150 $ 152 $ 0 $ 83 $ 151 $ 155 $ 155 $ 153
International
FundA,B
Europe
Capital 0 61 60 77 0 61 62 0 25 61 60 60 62
Appreciation
FundA,C
France
FundA 0 2 1 2 0 1 1 0 1 1 2 2 1
Germany
FundA 0 2 1 2 0 1 1 0 1 1 2 2 2
Hong Kong
and 0 17 15 20 0 15 16 0 12 16 17 17 16
China FundA,D
International
Value 0 69 60 78 0 61 62 0 42 62 67 67 62
FundA,E
Japan
FundA,F 0 136 129 163 0 131 132 0 60 130 133 133 132
Japan Small 0 34 29 37 0 29 30 0 21 30 33 33 30
Companies
FundA,G
Latin
America 0 211 170 219 0 172 174 0 104 175 206 206 175
FundA,H
Nordic
FundA 0 2 2 3 0 2 2 0 2 2 2 2 2
Southeast
Asia 0 299 276 350 0 279 282 0 141 280 292 292 282
FundA,I
United
Kingdom 0 1 1 1 0 1 1 0 0 1 1 1 1
FundA
TOTAL $ 0 $ 137,70 $ 134,70 $ 168,00 $ 0 $ 134,70 $ 136,20 $ 0 $ 85,33 $ 136,20 $136,20 $134,70 $136,20
COMPENSATION 0 0 0 0 0 3 0 0 0 0
FROM THE FUND
COMPLEX*,A
</TABLE>
* Information is for the calendar year ended December 31, 1996 for 235
funds in the complex.
** Interested Trustees of the funds are compensated by FMR.
*** Richard J. Flynn and Edward H. Malone served on the Board of Trustees
through December 31, 1996.
**** During the period from May 1, 1996 to December 31, 1996, William O.
McCoy served as a member of the Advisory Board of the trust.
(dagger) J. Gary Burkhead serves on the Board of Trustees through August 1,
1997 and, effective August 1, 1997, will serve as a Member of the Advisory
Board of the trust.
A Compensation figures include cash, a pro rata portion of benefits accrued
under the retirement program for the period ended December 30, 1996 and
required to be deferred, and may include amounts deferred at the election
of Trustees.
B The following amounts are required to be deferred by each non-interested
Trustee, most of which is subject to vesting: Ralph F. Cox, $7, Phyllis
Burke Davis, $7, Richard J. Flynn, $0, E. Bradley Jones, $7, Donald J.
Kirk, $7, William O. McCoy, $0, Gerald C. McDonough, $7, Edward H. Malone,
$7, Marvin L. Mann, $7 and Thomas R. Williams, $7.
C The following amounts are required to be deferred by each non-interested
Trustee, most of which is subject to vesting: Ralph F. Cox, $2, Phyllis
Burke Davis, $2, Richard J. Flynn, $0, E. Bradley Jones, $2, Donald J.
Kirk, $2, William O. McCoy, $0, Gerald C. McDonough, $2, Edward H. Malone,
$2, Marvin L. Mann, $2 and Thomas R. Williams, $2.
D The following amounts are required to be deferred by each non-interested
Trustee, most of which is subject to vesting: Ralph F. Cox, $1, Phyllis
Burke Davis, $1, Richard J. Flynn, $0, E. Bradley Jones, $1, Donald J.
Kirk, $1, William O. McCoy, $0, Gerald C. McDonough, $1, Edward H. Malone,
$1, Marvin L. Mann, $1 and Thomas R. Williams, $1.
E The following amounts are required to be deferred by each non-interested
Trustee, most of which is subject to vesting: Ralph F. Cox, $3, Phyllis
Burke Davis, $3, Richard J. Flynn, $0, E. Bradley Jones, $3, Donald J.
Kirk, $3, William O. McCoy, $0, Gerald C. McDonough, $3, Edward H. Malone,
$3, Marvin L. Mann, $3 and Thomas R. Williams, $3.
F The following amounts are required to be deferred by each non-interested
Trustee, most of which is subject to vesting: Ralph F. Cox, $5, Phyllis
Burke Davis, $5, Richard J. Flynn, $0, E. Bradley Jones, $5, Donald J.
Kirk, $5, William O. McCoy, $0, Gerald C. McDonough, $5, Edward H. Malone,
$5, Marvin L. Mann, $5 and Thomas R. Williams, $5.
G The following amounts are required to be deferred by each non-interested
Trustee, most of which is subject to vesting: Ralph F. Cox, $2, Phyllis
Burke Davis, $2, Richard J. Flynn, $0, E. Bradley Jones, $2, Donald J.
Kirk, $2, William O. McCoy, $0, Gerald C. McDonough, $2, Edward H. Malone,
$2, Marvin L. Mann, $2 and Thomas R. Williams, $2.
H The following amounts are required to be deferred by each non-interested
Trustee, most of which is subject to vesting: Ralph F. Cox, $8, Phyllis
Burke Davis, $8, Richard J. Flynn, $0, E. Bradley Jones, $8, Donald J.
Kirk, $8, William O. McCoy, $0, Gerald C. McDonough, $8, Edward H. Malone,
$8, Marvin L. Mann, $8 and Thomas R. Williams, $8.
I The following amounts are required to be deferred by each non-interested
Trustee, most of which is subject to vesting: Ralph F. Cox, $11, Phyllis
Burke Davis, $11, Richard J. Flynn, $0, E. Bradley Jones, $11, Donald J.
Kirk, $11, William O. McCoy, $0, Gerald C. McDonough, $0, Edward H. Malone,
$11,Marvin L. Mann, $11 and Thomas R. Williams, $11.
Under a retirement program adopted in July 1988 and modified in November
1995 and November 1996, each non-interested Trustee who retired before
December 30, 1996 may receive payments from a Fidelity fund during his or
her lifetime based on his or her basic trustee fees and length of service.
The obligation of a fund to make such payments is neither secured nor
funded. A Trustee became eligible to participate in the program at the end
of the calendar year in which he or she reached age 72, provided that, at
the time of retirement, he or she had served as a Fidelity fund Trustee for
at least five years.
Under deferred compensation plan adopted in September 1995 and amended
in November 1996 (the Plan), non-interested Trustees must defer receipt of
a portion of, an may elect to defer receipt of an additional portion of,
their annual fees. Amounts deferred under the Plan are treated as though
equivalent dollar amounts had been invested in shares of a cross-section of
Fidelity Funds including funds in each major investment discipline and
representing a majority of Fidelity's assets under management (the
Reference Funds). The amounts ultimately received by the Trustees under the
Plan will be directly linked to the investment performance of the Reference
Funds. Deferral of fees in accordance with the Plan will have a negligible
effect on the fund's assets, liabilities, and net income per share, and
will not obligate a fund to retain the services of any Trustee or to pay
any particular level of compensation to the Trustee. The funds may invest
in the Reference Funds under the Plan without shareholder approval.
As of December 30, 1996, the non-interested Trustees terminated the
retirement program for Trustees who retire after such date. In connection
with the termination of the retirement program, each existing
non-interested Trustee received a credit to his or her Plan account equal
to the present value of the estimated benefits that would have been payable
under the retirement program. The amounts credited to the non-interested
Trustees' Plan accounts are subject to vesting and are treated as though
equivalent dollar amounts had been invested in shares of the Reference
Funds. The amounts ultimately received by the Trustees in connection with
the credits to their Plan accounts will be directly linked to the
investment performance of the Reference Funds. The termination of the
retirement program and related crediting of estimated benefits to the
Trustees' Plan accounts did not result in a material cost to the funds.
As of May 31, 1997, the Trustees and officers of the trust owned, in
the aggregate, less than 1% of any of the funds' outstanding shares.
2. TO RATIFY THE SELECTION OF COOPERS & LYBRAND L.L.P. AND PRICE WATERHOUSE
LLP AS INDEPENDENT ACCOUNTANTS OF THE TRUST.
By a vote of the non-interested Trustees, the firms of Coopers & Lybrand
L.L.P. and Price Waterhouse LLP have been selected as independent
accountants for the trust to sign or certify any financial statements of
the trust required by any law or regulation to be certified by an
independent accountant and filed with the Securities and Exchange
Commission (SEC) or any state. Coopers & Lybrand L.L.P. has been selected
to serve as the independent accountant for Fidelity Canada Fund, Fidelity
Diversified International Fund, Fidelity Emerging Markets Fund, Fidelity
Europe Fund, Fidelity Global Bond Fund, Fidelity International Growth &
Income Fund, Fidelity International Value Fund, Fidelity Japan Fund,
Fidelity Overseas Fund, Fidelity Pacific Basin Fund and Fidelity Worldwide
Fund , and Price Waterhouse LLP has been selected to serve as the
independent accountant for Fidelity Europe Capital Appreciation Fund,
Fidelity France Fund, Fidelity Germany Fund, Fidelity Hong Kong & China
Fund, Fidelity Japan Small Companies Fund, Fidelity Latin America Fund,
Fidelity New Markets Income Fund, Fidelity Nordic Fund, Fidelity Southeast
Asia Fund, and Fidelity United Kingdom Fund. Pursuant to the 1940 Act, such
selection requires the ratification of shareholders. In addition, as
required by the 1940 Act, the vote of the Trustees is subject to the right
of the trust, by vote of a majority of its outstanding voting securities at
any meeting called for the purpose of voting on such action, to terminate
such employment without penalty. Coopers & Lybrand L.L.P. and Price
Waterhouse LLP have advised the trust that each has no direct or material
indirect ownership interest in the trust.
The independent accountants examine annual financial statements for the
funds and provide other audit and tax-related services. In recommending the
selection of the trust's accountants, the Audit Committee reviewed the
nature and scope of the services to be provided (including non-audit
services) and whether the performance of such services would affect the
accountants' independence. Representatives of Coopers & Lybrand L.L.P. and
Price Waterhouse LLP are not expected to be present at the Meeting, but
have been given the opportunity to make a statement if they so desire and
will be available should any matter arise requiring their presence.
3. TO AMEND THE DECLARATION OF TRUST TO PROVIDE DOLLAR-BASED VOTING RIGHTS
FOR SHAREHOLDERS OF THE TRUST.
The Board of Trustees has approved, and recommends that shareholders of
the trust approve, a proposal to amend Article VIII, Section 1 of the
Declaration of Trust. The amendment would provide voting rights based on a
shareholder's total dollar interest in a fund (dollar-based voting), rather
than on the number of shares owned, for all shareholder votes for a fund.
As a result, voting power would be allocated in proportion to the value of
each shareholder's investment.
BACKGROUND. Fidelity Diversified International Fund, Fidelity Europe
Capital Appreciation Fund, Fidelity France Fund, Fidelity Germany Fund,
Fidelity Hong Kong & China Fund, Fidelity International Value Fund,
Fidelity Japan Fund, Fidelity Japan Small Companies Fund, Fidelity Latin
America Fund, Fidelity Nordic Fund, Fidelity Southeast Asia Fund and
Fidelity United Kingdom Fund are funds of Fidelity Investment Trust, an
open-end management investment company organized as a Massachusetts
business trust; there are 9 other funds in the trust. The other funds in
the trust are Fidelity Canada Fund, Fidelity Emerging Markets Fund,
Fidelity Europe Fund, Fidelity Global Bond Fund, Fidelity International
Growth & Income Fund, Fidelity New Markets Income Fund, Fidelity Overseas
Fund, Fidelity Pacific Basin Fund, and Fidelity Worldwide Fund.
Shareholders of each fund vote separately on matters concerning only that
fund and vote on a trust-wide basis on matters that effect the trust as a
whole, such as electing trustees or amending the Declaration of Trust.
Currently, under the Declaration of Trust, each share is entitled to one
vote, regardless of the relative value of the shares of each fund in the
trust.
The original intent of the one-share, one-vote provision was to provide
equitable voting rights to all shareholders as required by the 1940 Act. In
the case where a trust has several series or funds, such as Fidelity
Investment Trust, voting rights may have become disproportionate since the
net asset value per share (NAV) of the separate funds generally diverge
over time. The Staff of the Securities and Exchange Commission (SEC) has
issued a "no-action" letter permitting a trust to seek shareholder approval
of a dollar-based voting system. The proposed amendment will comply with
the conditions stated in the no-action letter.
REASON FOR PROPOSAL. If approved, the amendment would provide a more
equitable distribution of voting rights for certain votes than the
one-share, one-vote system currently in effect. The voting power of each
shareholder would be commensurate with the value of the shareholder's
dollar investment rather than with the number of shares held.
Under the current voting provisions, an investment in a fund with a
lower NAV may have significantly greater voting power than the same dollar
amount invested in a fund with a higher NAV. The table below shows a
hypothetical example of this.
Fund Net Asset Value $1,000
investment in
terms of
number of
shares
A $ 10.00 100.000
B $ 7.57 132.100
C $ 10.93 91.491
D $ 1.00 1,000.000
For example, Fund D shareholders would have approximately ten times the
voting power of Fund A shareholders, because a $1,000 investment in Fund D
would buy ten times as many shares as a $1,000 investment in Fund A.
Accordingly, a one share, one-vote system may provide certain shareholders
with a disproportionate ability to affect the vote relative to shareholders
of other funds in the trust. If dollar-based voting had been in effect,
each shareholder would have had 1,000 voting shares. Their voting power
would be proportionate to their economic interest, which FMR believes is a
more equitable result, and which is the result with respect to a typical
corporation where each voting share generally has an equal market
price.
On matters requiring trust-wide votes where all funds are required to
vote, shareholders who own shares with a lower NAV than other funds in the
trust would be giving other shareholders in the trust more voting "power"
than they currently have. On matters affecting only one fund, only
shareholders of that fund vote on the issue. In this instance, under both
the current Declaration of Trust and an amended Declaration of Trust, all
shareholders of the fund would have the same voting rights, since the NAV
is the same for all shares in a single fund.
AMENDMENT TO THE DECLARATION OF TRUST. Article VIII, Section 1 sets forth
the method of calculating voting rights for all shareholder votes for the
trust. If approved, Article VIII, Section 1 will be amended as follows
(material to be added is underlined and material to be deleted is
[bracketed]):
ARTICLE VIII
SHAREHOLDERS' VOTING POWERS AND MEETINGS
VOTING POWERS
Section 1. The Shareholders shall have power to vote. On any matter
submitted to a vote of the Shareholders, all Shares shall be voted by
individual Series, except (i) when required by the 1940 Act, Shares shall
be voted in the aggregate and not by individual Series; and (ii) when the
Trustees have determined that the matter affects only the interests of one
or more Series, then only the Shareholders of such Series shall be entitled
to vote thereon. [Each whole Share shall be entitled to one vote as
to any matter on which it is entitled to vote, and each fractional Share
shall be entitled to a proportionate fractional vote.] ((A Shareholder of
each Series shall be entitled to one vote for each dollar of net asset
value (number of Shares owned times net asset value per share) of such
Series, on any matter on which such Shareholder is entitled to vote and
each fractional dollar amount shall be entitled to a proportionate
fractional vote. ))There shall be no cumulative voting in the election of
Trustees. Shares may be voted in person or by proxy. Until Shares are
issued, the Trustees may exercise all rights of Shareholders and may take
any action required or permitted by law, this Declaration of Trust or any
Bylaws of the Trust to be taken by Shareholders.
CONCLUSION. The Board of Trustees has concluded that the proposal will
benefit the trust and its shareholders. The Trustees recommend voting FOR
the proposal. The amendment will become effective upon shareholder
approval. If the proposal is not approved by the shareholders of the
trust, Article VIII, Section 1 of the Declaration of Trust will
remain unchanged.
4. TO AMEND THE DECLARATION OF TRUST REGARDING SHAREHOLDER NOTIFICATION OF
APPOINTMENT OF TRUSTEES.
The trust's Declaration of Trust provides that in the case of a vacancy on
the Board of Trustees, the remaining Trustees shall fill the vacancy by
appointing a person they, in their discretion, see fit, consistent with the
limitations of the 1940 Act. Section 16 of the 1940 Act states that a
vacancy may be filled by the Trustees, if after filling the vacancy, at
least two-thirds of the Trustees then holding office were elected by the
holders of the outstanding voting securities of the trust. It also states
that if at any time less than 50% of the Trustees were elected by
shareholders, a shareholder meeting must be called within 60 days for the
purposes of electing Trustees to fill the existing vacancies.
The Declaration of Trust currently requires that within three months of a
Trustee appointment, notification of such be mailed to each shareholder of
the trust. Trustees may appoint a Trustee in anticipation of a current
Trustee's retirement or resignation, or in the event of an increase in the
number of Trustees. The current Declaration of Trust also requires
shareholder notification within three months of such an appointment.
The Trustees recommend that shareholders of the trust vote to eliminate
the notification requirement from the trust's Declaration of Trust. The
language to be deleted from the Declaration of Trust is [bracketed].
ARTICLE IV
TRUSTEES
RESIGNATION AND APPOINTMENT OF TRUSTEES
Section 4. In case of the declination, death, resignation, retirement,
removal, incapacity, or inability of any of the Trustees, or in case a
vacancy shall, by reason of an increase in number, or for any other reason,
exist, the remaining Trustees shall fill such vacancy by appointing such
other person as they in their discretion shall see fit consistent with the
limitations under the Investment Company Act of 1940. Such appointment
shall be evidenced by a written instrument signed by a majority of the
Trustees in office or by recording in the records of the Trust, whereupon
the appointment shall take effect. [Within three months of such appointment
the Trustees shall cause notice of such appointment to be mailed to each
Shareholder at his address as recorded on the books of the trust.] An
appointment of a Trustee may be made by the Trustees then in office [and
notice thereof mailed to Shareholders as aforesaid] in anticipation of a
vacancy to occur by reason of retirement, resignation or increase in number
of Trustees effective at a later date, provided that said appointment shall
become effective only at or after the effective date of said retirement,
resignation or increase in number of Trustees. As soon as any Trustee so
appointed shall have accepted this trust, the trust estate shall vest in
the new Trustee or Trustees, together with the continuing Trustees, without
any further act or conveyance, and he shall be deemed a Trustee hereunder.
The power of appointment is subject to the provisions of Section 16 (a) of
the 1940 Act.
Notifying a trust's shareholders in the event of an appointment of a
Trustee is not required by any federal or state law. Such notification to
all shareholders of a trust would be costly to the funds of the trust. If
the proposal is approved, shareholders will be notified of Trustee
appointments in the next financial report for the fund. Other than
eliminating the notification requirement, this proposal does not amend any
other aspect of Trustee resignation or appointment.
CONCLUSION. The Board of Trustees has concluded that the proposal will
benefit the trust and its shareholders. The Trustees recommend voting FOR
the proposal. The amendment will become effective upon shareholder
approval. If the proposal is not approved by the shareholders of the
trust , Article IV, Section 4 of the Declaration of Trust will remain
unchanged.
5. TO AMEND THE DECLARATION OF TRUST TO PROVIDE EACH FUND WITH THE ABILITY
TO INVEST ALL OF ITS ASSETS IN ANOTHER OPEN-END INVESTMENT COMPANY .
The Board of Trustees has approved, and recommends that shareholders of
the trust approve, a proposal to amend Article V, Section 1 of the
Declaration of Trust to clarify that the Trustees may authorize the
investment of all of a fund's assets in another open-end investment
company . ("Master Feeder Fund Structure"). The purpose of a Master
Feeder Fund Structure is to achieve operational efficiencies by
consolidating portfolio management while maintaining different distribution
and servicing structures. In order to implement a Master Feeder Fund
Structure, both the Declaration of Trust and the funds' policies must
permit the structure. Currently, Fidelity Diversified International Fund's,
Fidelity Europe Capital Appreciation Fund's, Fidelity Japan Fund's,
Fidelity Latin America Fund's, and Fidelity Southeast Asia Fund's policies
do not allow for such investments. Proposal 6 on page seeks the approval
of those funds' shareholders to adopt a fundamental investment policy to
permit investment in another open-end investment company. This proposal,
which amends the Declaration of Trust, clarifies the Board's ability to
implement the Master Feeder Fund Structure if a fund's policies permit it.
BACKGROUND. A number of mutual funds have developed so called
"master-feeder" fund structures under which several "feeder" funds invest
all of their assets in a single pooled investment, or "master" fund. For
example, an institutional equity fund with a high initial minimum
investment amount for large investors might pool its investments with an
equity fund with low minimums designed for retail investors. Th e
structure in this example allows several Feeder Funds with
substantially the same objective but different distribution and servicing
features to combine their investments and manage them as one Master Fund
instead of managing them separately. The Feeder Funds combine their
investments by investing all of their assets in one Master Fund. (Each
Feeder Fund invested in a single Master Fund retains its own
characteristics, but is able to achieve operational efficiencies by
investing together with the other Feeder Funds in the Master Feeder Fund
Structure.) The current Declaration of Trust does not specifically provide
the Trustees the ability to authorize the Master Feeder Fund Structure.
REASON FOR THE PROPOSAL. FMR and the Board of Trustees continually review
methods of structuring mutual funds to take maximum advantage of potential
efficiencies. While neither FMR nor the Trustees has determined that a fund
should invest in a Master Fund, the Trustees believe it could be in the
best interest of each fund to adopt such a structure at a future date. If
this proposal is approved, the Declaration of Trust amendment would provide
the Trustees with the power to authorize a fund to invest all of its assets
in a single open-end investment company. The Trustees will authorize such a
transaction only if a Master Feeder Fund Structure is permitted under the
fund's investment policies (see Proposal 6), if they determine that a
Master Feeder Fund Structure is in the best interest of a fund, and if,
upon advice of counsel, they determine that the investment will not have
material adverse tax consequences to each fund or its shareholders. The
Trustees will specifically consider the impact, if any, on fees paid by the
fund as a result of adopting a Master Feeder Fund Structure. Although the
current Declaration of Trust does not contain any explicit prohibition
against implementing a Master Feeder Fund Structure, the specific authority
is being sought in the event the Trustees deem it appropriate to adopt a
Master Feeder Fund Structure in the future.
AMENDMENT TO THE DECLARATION OF TRUST. If the proposal is approved,
Article V, Section 1 of the Declaration of Trust will be amended as
follows: (material to be added is underlined):
"Subject to any applicable limitation in the Declaration of Trust or the
Bylaws of the Trust, the Trustees shall have the power and authority:
(((t) Notwithstanding any other provision hereof, to invest all of the
assets of any series in a single open-end investment company, including
investment by means of transfer of such assets in exchange for an interest
or interests in such investment company;"))
CONCLUSION. The Board of Trustees has concluded that the proposal will
benefit the trust and its shareholders. The Trustees recommend voting FOR
the proposal. The amendment will become effective upon shareholder
approval. If the proposal is not approved by the shareholders of the
trust , Article V, Section 1 of the Declaration of Trust will remain
unchanged.
6. TO ADOPT A NEW FUNDAMENTAL INVESTMENT POLICY FOR FIDELITY DIVERSIFIED
INTERNATIONAL FUND, FIDELITY EUROPE CAPITAL APPRECIATION FUND, FIDELITY
JAPAN FUND, FIDELITY LATIN AMERICA FUND, AND FIDELITY SOUTHEAST ASIA FUND
TO PERMIT THESE FUNDS TO INVEST ALL OF THEIR ASSETS IN ANOTHER OPEN-END
INVESTMENT COMPANY WITH SUBSTANTIALLY THE SAME INVESTMENT OBJECTIVE AND
POLICIES.
The Board of Trustees has approved, and recommends that shareholders of
Fidelity Diversified International Fund, Fidelity Europe Capital
Appreciation Fund, Fidelity Japan Fund, Fidelity Latin America Fund, and
Fidelity Southeast Asia Fund (the funds) approve, the adoption of a new
fundamental investment policy that would permit these funds to invest all
of their assets in another open-end investment company with substantially
the same investment objective and policies ("Master Feeder Fund
Structure"). The purpose of the Master Feeder Fund Structure would be to
achieve operational efficiencies by consolidating portfolio management
while maintaining different distribution and servicing structures.
BACKGROUND. A number of mutual funds have developed so called
"master-feeder" fund structures under which several "feeder" funds invest
all of their assets in a single "master" fund. In order to implement a
Master Feeder Fund Structure, an amendment to the Declaration of Trust is
proposed, as is the adoption of a new fundamental investment policy.
Proposal 5 proposes to amend the Declaration of Trust to allow the Trustees
to authorize the conversion to a Master Feeder Fund Structure when
permitted by each fund's policies. This proposal would add a fundamental
policy for these funds that permits a Master Feeder Fund Structure.
REASON FOR THE PROPOSAL. FMR and the Board of Trustees continually review
methods of structuring mutual funds to take advantage of potential
efficiencies. While neither the Board nor FMR has determined that the funds
should invest in a Master Fund, the Trustees believe it could be in the
best interests of these funds to adopt such a structure at a future date.
At present, certain of the funds' fundamental investment policies and
limitations would prevent these funds from investing all of their assets in
another investment company, and would require a vote of shareholders before
such a structure could be adopted. To avoid the costs associated with a
subsequent shareholder meeting, the Trustees recommend that shareholders
vote to permit these funds' assets to be invested in a single Master Fund,
without a further vote of shareholders. The Trustees will authorize such an
investment only if they determine that action to be in the best interests
of these funds and their shareholders and if, upon advice of counsel, they
determine that the investment will not have material adverse tax
consequences to these funds. Approval of Proposal 5 provides the Trustees
with explicit authority to approve a Master Feeder Fund Structure. If
shareholders approve this proposal, certain fundamental and non-fundamental
policies and limitations of the funds' that currently prohibit investment
in shares of one investment company would not apply to permit the
investment in a Master Fund managed by FMR or its affiliates or successor.
These policies include Fidelity Diversified International Fund's, Fidelity
Europe Capital Appreciation Fund's, Fidelity Japan Fund's, Fidelity Latin
America Fund's and Fidelity Southeast Asia Fund's limitations on
concentration, diversification, and underwriting.
DISCUSSION. FMR may manage a number of mutual funds with similar
investment objectives, policies, and limitations but with different
features and services (Comparable Funds). Were these Comparable Funds to
pool their assets, operational efficiencies could be achieved, offering the
opportunity to reduce costs. Similarly, FMR anticipates that a Master
Feeder Fund Structure would facilitate the introduction of new Fidelity
mutual funds, increasing the investment options available to shareholders.
Fidelity Diversified International Fund's, Fidelity Europe Capital
Appreciation Fund's, Fidelity Japan Fund's, Fidelity Latin America Fund's
and Fidelity Southeast Asia Fund's methods of operation and shareholder
services would not be materially affected by their investment in a Master
Fund, except that the assets of these funds would be managed as part of a
larger pool. Were these funds to invest all of their assets in a Master
Fund, they would hold only a single investment security, and the Master
Fund would directly invest in individual securities pursuant to its
investment objective. The Master Fund would be managed by FMR or an
affiliate, such as FMR Texas, Inc. in the case of a money market fund. The
Trustees would retain the right to withdraw the funds' investments from a
Master Fund at any time and would do so if the Master Fund's investment
objective and policies were no longer appropriate for these funds. The
funds would then resume investing directly in individual securities as they
do currently. Whenever a Feeder Fund is asked to vote at a shareholder
meeting of the Master Fund, the Feeder Fund will hold a meeting of its
shareholders if required by applicable law or the Feeder Fund's policies to
vote on the matters to be considered at the Master Fund shareholder
meeting. The fund will cast its votes at the Master Fund meeting in the
same proportion as the fund's shareholders voted at their meeting.
At present, the Trustees have not considered any specific proposal to
authorize pooling of assets. The Trustees will authorize investing each
fund's assets in a Master Fund only if they determine that pooling is in
the best interests of these funds and if, upon advice of counsel, they
determine that the investment will not have material adverse tax
consequences to the funds or their shareholders. In determining whether to
invest in a Master Fund, the Trustees will consider, among other things,
the opportunity to reduce costs and to achieve operational efficiencies.
The Trustees will not authorize investment in a Master Fund if doing so
would materially increase costs (including fees) to shareholders.
FMR may benefit from the use of a Master Feeder Fund Structure if overall
assets under management are increased (since FMR's fees are based on
assets). Also, FMR's expenses of providing investment and other services to
these funds may be reduced. If a fund's investment in a Master Fund were to
reduce FMR's expenses materially, the Trustees would consider whether a
reduction in FMR's management fee would be appropriate if and when a Master
Feeder Fund Structure is implemented.
PROPOSED FUNDAMENTAL POLICY. To allow each fund to invest in a Master Fund
at a future date, the Trustees recommend that Fidelity Diversified
International Fund, Fidelity Europe Capital Appreciation Fund, Fidelity
Japan Fund, Fidelity Latin America Fund, and Fidelity Southeast Asia Fund
adopt the following fundamental policy:
"The fund may, notwithstanding any other fundamental investment policy or
limitation, invest all of its assets in the securities of a single open-end
management investment company managed by Fidelity Management & Research
Company or an affiliate or successor with substantially the same
fundamental investment objective, policies, and limitations as the fund."
If the proposal is adopted, the Trustees intend to adopt a non-fundamental
investment limitation for these funds which states:
"The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company managed by
Fidelity Management & Research Company or an affiliate or successor with
substantially the same fundamental investment objective, policies, and
limitations as the fund."
CONCLUSION. The Board of Trustees has concluded that the proposal will
benefit these funds and their shareholders. The Trustees recommend voting
FOR the proposal. Upon shareholder approval, the changes will become
effective when the disclosure is revised reflect the changes. If the
proposal is not approved by the shareholders of a fund, that fund's current
fundamental investment policies will remain unchanged with respect to
potential investment in Master Funds.
7. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR FIDELITY DIVERSIFIED
INTERNATIONAL 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 Fidelity Diversified International Fund
approve, a proposal to adopt an amended management contract with FMR (the
Amended Contract). The Amended Contract modifies several aspects of the
management fee that FMR receives from the fund for managing its investments
and business affairs.
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 0.45%. The Basic Fee rate for the fund's
fiscal year ended October 31, 1996 (not including the fee amendments
discussed below) was 0.7 611 %.
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 Morgan Stanley Capital International Europe,
Australasia, Far East Index (GDP-weighted) (the Index) over 36 months, FMR
receives a positive Performance Adjustment, and if the fund underperforms
the Index, 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 of
outperformance or underperformance, subject to a maximum of 0.20% if the
fund outperforms or underperforms the Index by more than ten percentage
points. Performance of the fund and the Index are rounded to the nearest
whole percentage point for purposes of the calculation.
PROPOSED MANAGEMENT FEE AMENDMENTS. The Amended Contract would (1) reduce
the Group Fee rate further if FMR's assets under management remain over
$210 billion, and (2) modify the Performance Adjustment calculation to
round the performance of the fund and the Index to the nearest 0.01%,
rather than the nearest 1.00%.
IMPACT OF GROUP FEE RATE REDUCTION. At FMR's current level of assets under
management ($ 482 billion as of May 1997), the changes to the Group
Fee rate reduce the management fee. FMR has voluntarily implemented the
Group Fee reductions pending shareholder approval, and the fund has paid
lower management fees as a result. For the fund's fiscal year ended October
31, 1996, the management fee using the proposed Group Fee reductions
(including the Performance Adjustment) was 0.8 503 % of the fund's
average net assets. The Group Fee reductions lowered the management fee
rate by 0.0078% compared to the rate FMR was entitled to receive under the
Present Contract ( 0.85 8 1% ) .
IMPACT OF PERFORMANCE ADJUSTMENT CHANGES. The more precise rounding method
for the Performance Adjustment would have de creased the management
fee rate for the fiscal year ended October 31, 1996 by 0.00 09 % of
the Fund's average net assets for the year.
COMBINED EFFECT OF FEE CHANGES. In the fiscal year ended October 31, 1996,
the Group Fee reductions and the changes to the Performance Adjustment
would have resulted in a 0.00 8 7% reduction in the total management
fee. The future impact will depend on many different factors, and may
represent an increase or decrease from the management fee under the Present
Contract. The Group Fee rate reductions will either reduce the management
fee or leave it unchanged, depending on the level of FMR's assets under
management. Calculating performance to the nearest 0.01% may increase or
decrease the Performance Adjustment, depending on whether performance would
have been rounded up or down.
PRESENT AND AMENDED CONTRACTS. FMR is the fund's investment adviser
pursuant to a management contract dated October 1, 1992, which was approved
by shareholders on September 16, 1992. (For information on FMR, see the
section entitled "Activities and Management of FMR," on page .) A copy of
the Amended Contract, marked to indicate the proposed amendments, is
supplied as Exhibit 1 on page . Except for the modifications discussed
above, the Amended Contract is substantially identical to the fund's
Present Contract with FMR. (For a detailed discussion of the fund's Present
Contract, refer to the section entitled "Present Management Contracts," on
page .) If approved by shareholders, the Amended Contract will take effect
on the first day of the first month following approval and will remain in
effect through July 31, 1998 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 is
not approved, the Present Contract will continue in effect through July 31,
1998, and thereafter only as long as its continuance is approved at least
annually as above.
MODIFICATION TO GROUP FEE RATE. The Group Fee rate varies based on the
aggregate net assets of all registered investment companies having
management contracts with FMR (group assets). As group assets increase, the
Group Fee rate declines. The Amended Contract would not change the Group
Fee rate if group assets are $210 billion or less. Above $210 billion in
group assets, the Group Fee rate declines under both contracts, but under
the Amended Contract, it declines faster.
The Group Fee rate is calculated according to a graduated schedule
providing for different rates for different levels of group assets. The
rate at which the Group Fee rate declines is determined by fee
"breakpoints" that provide for lower fee rates when group assets increase.
The Amended Contract would add 10 new, lower breakpoints applicable when
group assets are above $210 billion as illustrated in the following table.
(For an explanation of how the Group Fee rate is used to calculate the
management fee see the section entitled "Present Management Contracts" on
page .)
GROUP FEE RATE BREAKPOINTS
Average Group Present Group Amended
Assets Contract Assets Contract
($ billions) ($ billions)
Over 174 .3000% 174-210 .3000%
210-246 .2950%
246-282 .2900%
282-318 .2850%
318-354 .2800%
354-390 .2750%
390-426 .2700%
426-462 .2650%
462-498 .2600%
498-534 .2550%
Over 534 .2500%
The resulting Group Fee rates at various levels of group assets are
indicated below. (For an explanation of how the breakpoints are combined to
arrive at the Group Fee rate, see "Present Management Contracts" on page .)
EFFECTIVE GROUP FEE RATES
Group Present Amended
Assets Contract Contract
($ billions)
150 .3371% .3371%
200 .3284% .3284%
250 .3227% .3219%
300 .3190% .3163%
350 .3162% .3113%
400 .3142% .3067%
450 .3126% .3024%
500 .3114% .2982%
550 .3103% .2942%
FMR voluntarily adopted various additional Group Fee breakpoints for group
assets over $174 billion in 1993, 1994, and 1996. Although the new fee
breakpoints have not been added to the management contract pending
shareholder approval, FMR has voluntarily based its management fee on the
Group Fee schedule contained in the Amended Contract since January 1, 1996.
Group assets for May 1997 were approximately $ 482 billion.
MODIFICATIONS TO PERFORMANCE ADJUSTMENT. The annual Performance Adjustment
rate equals 0.02% for each percentage point by which the fund outperforms
or underperforms the Index over a 36-month performance period. Under the
Present Contract, the investment performance of both the fund and the Index
are rounded to the nearest full percentage point (for example, 15.5123% is
rounded to 16%.) Rounding to full percentage points results in the
Performance Adjustment rate being applied in 0.02% increments. In
comparison, under the Amended Contract, the investment performance of both
the fund and Index are rounded to the nearest 0.01% (using the prior
example, 15.5123% is rounded to 15.51%) prior to calculating the difference
in investment performance. The more precise rounding method results in a
more accurate measure of the difference in investment performance and
allows for the Performance Adjustment to be applied in 0.0002% increments.
This reduces the chance of minor changes in performance resulting in
significant changes to the Performance Adjustment, and ultimately the
fund's management fee.
During fiscal 1996, using the more precise rounding methodology, the
impact on the annual performance fee rate would have been between 0.0127%
and (0.0127)% as a percentage of the fund's average net assets for the
year. The aggregate impact during fiscal 1996 was a 0.0009% decrease in the
management fee.
In addition, the Amended Contract explicitly refers to the GDP-weighted
version of the Index, which is the version the fund has used since
inception.
COMPARISON OF MANAGEMENT FEES. The following table compares the fund's
management fee as calculated under the terms of the Present Contract (not
including FMR's voluntary implementation of the Group Fee reductions) for
fiscal 1996 to the management fee the fund would have incurred if the
Amended Contract had been in effect. Management fees are expressed in
dollars and as percentages of the fund's average net assets for the year.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Present Contract Amended Contract Difference
$ % $ % $ %
Basic Fee 3,642,576 0.7611 3,605,498 0.7533 (37,078) (0.0078)
Performance 464,459 0.0970 459,727 0.0961 (4,732) (0.0009)
Adjustment
Total Management Fee 4,10 7 ,035 0.8581 4,065,225 0.8494 (41,810) (0.0087)
</TABLE>
The following table provides data concerning the fund's management fees
and expenses as a percentage of average net assets for the fiscal year
ended October 31, 1996 under the Present Contract (not including FMR's
voluntary implementation of the Group Fee reductions) and if the Amended
Contract had been in effect during the same period.
The following figures are based on historical expenses adjusted to reflect
current fees of the fund and are calculated as a percentage of average net
assets.
COMPARATIVE FEE TABLE
ANNUAL FUND OPERATING EXPENSES (as a percentage of average net assets)
Present Contract Amended Contract
Management Fee 0.86 % 0.85%
Other Expenses 0.44% 0.44%
Total Fund Operating Expenses 1.30 % 1.29%
A portion of the brokerage commissions that the fund pays is used to
reduce the fund's expenses. The fund has entered into arrangements with its
custodian and transfer agent whereby interest earned on uninvested cash
balances is used to offset a portion of the fund's expenses. Including
these reductions, the total operating expenses presented in the table would
have been 1 . 28 % under the Present Contract and
1 . 27 % under the Amended Contract.
EXAMPLE: The following illustrates the expenses on a $1,000 investment
under the fees and expenses stated above, assuming (1) 5% annual return and
(2) redemption at the end of each time period:
1 Year 3 Years 5 Years 10 Years
Present Contract $ 13 $ 41 $ 71 $ 157
Amended Contract 13 41 71 156
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.
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) are 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 the Independent Trustees on
October 9, 1996. The Board of Trustees considered and approved the
modifications to the Group Fee Rate schedule during the two month periods
from November to December 1995, June to July 1994, and September to October
1993, and the modifications to the Performance Adjustment calculation
during the period from June to July 1995. 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 Trustees receive materials specifically relating to the
Amended Contract. These materials include: (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, (iii) the economic outlook and the general
investment outlook in the markets in which the fund invests, and (iv)
notable changes in the fund's investments. 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 quality 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:
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.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the Independent
Trustees annually review a report detailing 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 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 market 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 benefitted 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 but determined that it would be appropriate to change the
group fee structure as proposed herein.
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, credit
card, 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.
OTHER 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.
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 modifications to the management fee rates, that is the reduction
of the Group Fee Rate schedule and the modifications to the performance
adjustment calculation, 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. If approved by shareholders, the Amended Contract will take
effect on the first day of the first month following approval .
8. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR FIDELITY INTERNATIONAL
VALUE 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 Fidelity International Value Fund
approve, a proposal to adopt an amended management contract with FMR (the
Amended Contract). The Amended Contract modifies several aspects of the
management fee that FMR receives from the fund for managing its investments
and business affairs.
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 0.45%. The Basic Fee rate for the fund's
fiscal year ended October 31, 1996 (not including the fee amendments
discussed below) was 0.7527%.
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 Morgan Stanley Capital International Europe,
Australasia, Far East Index (the Index) over 36 months, FMR receives a
positive Performance Adjustment, and if the fund underperforms the Index,
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 of outperformance or
underperformance, subject to a maximum of 0.20% if the fund outperforms or
underperforms the Index by more than ten percentage points. Performance of
the fund and the Index are rounded to the nearest whole percentage point
for purposes of the calculation.
PROPOSED MANAGEMENT FEE AMENDMENTS. The Amended Contract would (1) reduce
the Group Fee rate further if FMR's assets under management remain over
$390 billion, and (2) modify the Performance Adjustment calculation to
round the performance of the fund and the Index to the nearest 0.01%,
rather than the nearest 1.00%.
IMPACT OF GROUP FEE RATE REDUCTION. T he changes to the Group Fee
rate reduce the management fee rate slightly at FMR's current level of
assets under management (a decrease of less than 0.0001%) . FMR has
voluntarily implemented the Group Fee reductions pending shareholder
approval, and the fund has paid lower management fees as a result.
IMPACT OF PERFORMANCE ADJUSTMENT CHANGES. The more precise rounding method
for the Performance Adjustment would have increased the management fee rate
for the fiscal year ended October 31, 1996 by 0.0016% of the f und's
average net assets for the year.
COMBINED EFFECT OF FEE CHANGES. In the fiscal year ended October 31, 1996,
the Group fee reductions and the changes to the Performance Adjustment
would have resulted in a 0.0016% increase in the total management fee. The
future impact will depend on many different factors, and may represent an
increase or decrease from the management fee under the Present Contract.
The Group Fee rate reductions will either reduce the management fee or
leave it unchanged, depending on the level of FMR's assets under
management. Calculating performance to the nearest 0.01% may increase or
decrease the Performance Adjustment, depending on whether performance would
have been rounded up or down.
PRESENT AND AMENDED CONTRACTS. FMR is the fund's investment adviser
pursuant to a management contract dated September 16, 1994 which was
approved by FMR, then sole shareholder on September 23, 1994. (For
information on FMR, see the section entitled "Activities and Management of
FMR," on page .) A copy of the Amended Contract, marked to indicate the
proposed amendments, is supplied as Exhibit 2 on page .
Except for the modifications discussed above, the Amended Contract is
substantially identical to the fund's Present Contract with FMR. (For a
detailed discussion of the fund's Present Contract, refer to the section
entitled "Present Management Contracts," on page .) If approved by
shareholders, the Amended Contract will take effect on the first day of the
first month following approval and will remain in effect through July 31,
1998 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 is not approved, the Present Contract
will continue in effect through July 31, 1998, and thereafter only as long
as its continuance is approved at least annually as above.
MODIFICATION TO GROUP FEE RATE. The Group Fee rate varies based on the
aggregate net assets of all registered investment companies having
management contracts with FMR (group assets). As group assets increase, the
Group Fee rate declines. The Amended Contract would not change the Group
Fee rate if group assets are $426 billion or less. Above $426 billion in
group assets, the Group Fee rate declines under both contracts, but under
the Amended Contract, it declines faster.
The Group Fee rate is calculated according to a graduated schedule
providing for different rates for different levels of group assets. The
rate at which the Group Fee rate declines is determined by fee
"breakpoints" that provide for lower fee rates when group assets increase.
The Amended Contract would add four new, lower breakpoints applicable when
group assets are above $426 billion as illustrated in the following table.
(For an explanation of how the Group Fee rate is used to calculate the
management fee see the section entitled "Present Management Contracts" on
page .)
GROUP FEE RATE BREAKPOINTS
Average Group Present Group Amended
Assets Contract Assets Contract
($ billions) ($ billions)
Over 390 .2700% 390-426 .2700%
426-462 .2650%
462-498 .2600%
498-534 .2550%
Over 534 .2500%
The resulting Group Fee rates at various levels of group assets are
indicated below. (For an explanation of how the breakpoints are combined to
arrive at the Group Fee rate, see "Present Management Contracts" on page .)
EFFECTIVE GROUP FEE RATES
Group Present Amended
Assets Contract Contract
($ billions)
150 .3371% .3371%
200 .3284% .3284%
250 .3219% .3219%
300 .3163% .3163%
350 .3113% .3113%
400 .3067% .3067%
450 .3026% .3024%
500 .2994% .2982%
550 .2967% .2942%
FMR voluntarily adopted various additional Group Fee breakpoints for group
assets over $390 billion in 1996. Although the new fee breakpoints have not
been added to the management contract pending shareholder approval, FMR has
voluntarily based its management fee on the Group Fee schedule contained in
the Amended Contract since January 1, 1996. Group assets for May 1997 were
approximately 482 billion.
MODIFICATIONS TO PERFORMANCE ADJUSTMENT - ROUNDING METHOD. The
annual Performance Adjustment rate equals 0.02% for each percentage point
by which the fund outperforms or underperforms the Index over a 36-month
performance period. Under the Present Contract, the investment performance
of both the fund and the Index are rounded to the nearest full percentage
point (for example, 15.5123% is rounded to 16%.) Rounding to full
percentage points results in the Performance Adjustment rate being applied
in 0.02% increments. In comparison, under the Amended Contract, the
investment performance of both the fund and Index are rounded to the
nearest 0.01% (using the prior example, 15.5123% is rounded to 15.51%)
prior to calculating the difference in investment performance. The more
precise rounding method results in a more accurate measure of the
difference in investment performance and allows for the Performance
Adjustment to be applied in 0.0002% increments. This reduces the chance of
minor changes in performance resulting in significant changes to the
Performance Adjustment, and ultimately the fund's management fee.
During fiscal 1996, using the more precise rounding methodology, the
impact on the annual performance fee rate would have been between 0.0084%
and (0.0084)% as a percentage of the fund's average net assets for the
year. The aggregate impact during fiscal 1996 was a 0.0016% increase in the
management fee.
COMPARISON OF MANAGEMENT FEES. The following table compares the fund's
management fee as calculated under the terms of the Present Contract (not
including FMR's voluntary implementation of the Group Fee reductions) for
fiscal 1996 to the management fee the fund would have incurred if the
Amended Contract had been in effect. Management fees are expressed in
dollars and as percentages of the fund's average net assets for the year.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Present Contract Amended Contract Difference
$ % $ % $ %
Basic
Fee 1,636,252 0.7527 1,636,231 0.7527 (21) 0.0000
Performance
86,631 0.0399 90,192 0.0415 3,561 0.0016
Adjustment
Total Management
Fee 1,722,883 0.7926 1,726,423 0.7942 3,540 0.0016
</TABLE>
The following table provides data concerning the fund's management fees
and expenses as a percentage of average net assets for the fiscal year
ended October 31, 1996 under the Present Contract (not including FMR's
voluntary implementation of the Group Fee reductions) and if the Amended
Contract had been in effect during the same period.
The following figures are based on historical expenses adjusted to reflect
current fees of the fund and are calculated as a percentage of average net
assets.
COMPARATIVE FEE TABLE
ANNUAL FUND OPERATING EXPENSES (as a percentage of average net assets)
Present Contract Amended Contract
Management Fee 0.79 % 0.79%
Other Expenses 0.49 % 0.49%
Total Fund Operating Expenses 1.28 % 1.28%
A portion of the brokerage commissions that the fund pays is used to
reduce the fund's expenses. The fund has entered into arrangements with its
custodian and transfer agent whereby interest earned on uninvested cash
balances is used to offset a portion of the fund's expenses. Including
these reductions, the total operating expenses presented in the table would
have been 1.26 % under the Present Contract and 1.26 % under
the Amended Contract.
EXAMPLE: The following illustrates the expenses on a $1,000 investment
under the fees and expenses stated above, assuming (1) 5% annual return and
(2) redemption at the end of each time period:
1 Year 3 Years 5 Years 10 Years
Present Contract $ 13 $ 41 $ 70 $ 155
Amended Contract 13 41 70 155
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.
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) are 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 the Independent Trustees on
October 9, 1996. The Board of Trustees considered and approved the
modifications to the Group Fee Rate schedule during the two month periods
from November to December 1995, June to July 1994, and September to October
1993, and the modifications to the Performance Adjustment calculation
during the period from June to July 1995. 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 Trustees receive materials specifically relating to the
Amended Contract. These materials include: (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, (iii) the economic outlook and the general
investment outlook in the markets in which the fund invests, and (iv)
notable changes in the fund's investments. 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 quality 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:
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.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the Independent
Trustees annually review a report detailing 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 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 market 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 benefitted 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 but determined that it would be appropriate to change the
group fee structure as proposed herein.
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, credit
card, 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.
OTHER 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.
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 modifications to the management fee rates, that is the reduction
of the Group Fee Rate schedule and the modifications to the performance
adjustment calculation, 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. If approved by shareholders, the Amended Contract will take
effect on the first day of the first month following approval.
9. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR FIDELITY EUROPE CAPITAL
APPRECIATION 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 Fidelity Europe Capital Appreciation
Fund approve, a proposal to adopt an amended management contract with FMR
(the Amended Contract). The Amended Contract modifies several aspects of
the management fee that FMR receives from the fund for managing its
investments and business affairs.
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 0.45%. The Basic Fee rate for the fund's
fiscal year ended October 31, 1996 (not including the fee amendments
discussed below) was 0. 7602 %.
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 Morgan Stanley Capital International Europe Index (the
Index) over 36 months, FMR receives a positive Performance Adjustment, and
if the fund underperforms the Index, 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
of outperformance or underperformance, subject to a maximum of 0.20% if the
fund outperforms or underperforms the Index by more than ten percentage
points. Performance of the fund and the Index are rounded to the nearest
whole percentage point for purposes of the calculation.
PROPOSED MANAGEMENT FEE AMENDMENTS. The Amended Contract would (1) reduce
the Group Fee rate further if FMR's assets under management remain over
$210 billion, and (2) modify the Performance Adjustment calculation to
round the performance of the fund and the Index to the nearest 0.01%,
rather than the nearest 1.00%.
IMPACT OF GROUP FEE RATE REDUCTION. At FMR's current level of assets under
management ($ 482 billion as of May 1997), the changes to the Group
Fee rate reduce the management fee. FMR has voluntarily implemented the
Group Fee reductions pending shareholder approval, and the fund has paid
lower management fees as a result. For the fund's fiscal year ended October
31, 1996, the management fee using the proposed Group Fee reductions
(including the Performance Adjustment) was 0 .7977% of the fund's
average net assets. The Group Fee reductions lowered the management fee
rate by 0.0030% compared to the rate FMR was entitled to receive under the
Present Contract ( 0.8007% ) .
IMPACT OF PERFORMANCE ADJUSTMENT CHANGES. The more precise rounding method
for the Performance Adjustment would have decreased the management fee rate
for the fiscal year ended October 31, 1996 by 0.0023% of the Fund's average
net assets for the year.
COMBINED EFFECT OF FEE CHANGES. In the fiscal year ended October 31, 1996,
the Group Fee reductions and the changes to the Performance Adjustment
would have resulted in a 0.0053% reduction in the total management fee. The
future impact will depend on many different factors, and may represent an
increase or decrease from the management fee under the Present Contract.
The Group Fee rate reductions will either reduce the management fee or
leave it unchanged, depending on the level of FMR's assets under
management. Calculating performance to the nearest 0.01% may increase or
decrease the Performance Adjustment, depending on whether performance would
have been rounded up or down.
PRESENT AND AMENDED CONTRACTS. FMR is the fund's investment adviser
pursuant to a management contract dated November 18, 1993 which was
approved by FMR, then sole shareholder, on November 22, 1993. (For
information on FMR, see the section entitled "Activities and Management of
FMR," on page .) A copy of the Amended Contract, marked to indicate the
proposed amendments, is supplied as Exhibit on page . Except
for the modifications discussed above, the Amended Contract is
substantially identical to the fund's Present Contract with FMR. (For a
detailed discussion of the fund's Present Contract, refer to the section
entitled "Present Management Contracts," on page .) If approved by
shareholders, the Amended Contract will take effect on the first day of the
first month following approval and will remain in effect through July 31,
1998 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 is not approved, the Present Contract
will continue in effect through July 31, 1998, and thereafter only as long
as its continuance is approved at least annually as above.
MODIFICATION TO GROUP FEE RATE. The Group Fee rate varies based on the
aggregate net assets of all registered investment companies having
management contracts with FMR (group assets). As group assets increase, the
Group Fee rate declines. The Amended Contract would not change the Group
Fee rate if group assets are $210 billion or less. Above $210 billion in
group assets, the Group Fee rate declines under both contracts, but under
the Amended Contract, it declines faster.
The Group Fee rate is calculated according to a graduated schedule
providing for different rates for different levels of group assets. The
rate at which the Group Fee rate declines is determined by fee
"breakpoints" that provide for lower fee rates when group assets increase.
The Amended Contract would add seven new, lower breakpoints
applicable when group assets are above $210 billion as illustrated in the
following table. (For an explanation of how the Group Fee rate is used to
calculate the management fee see the section entitled "Present Management
Contracts" on page .)
GROUP FEE RATE BREAKPOINTS
Average Group Present Group Amended
Assets Contract Assets Contract
($ billions) ($ billions)
174 - 228 .3000% 174-210 .3000%
228 - 282 .2950% 210-246 .2950%
282 - 336 .2900% 246-282 .2900%
Over 336 .2850% 282-318 .2850%
318-354 .2800%
354-390 .2750%
390-426 .2700%
426-462 .2650%
462-498 .2600%
498-534 .2550%
Over 534 .2500%
The resulting Group Fee rates at various levels of group assets are
indicated below. (For an explanation of how the breakpoints are combined to
arrive at the Group Fee rate, see "Present Management Contracts" on page .)
EFFECTIVE GROUP FEE RATES
Group Present Amended
Assets Contract Contract
($ billions)
150 .3371% .3371%
200 .3284% .3284%
250 .3223% .3219%
300 .3175% .3163%
350 .3133% .3113%
400 .3098% .3067%
450 .3070% .3024%
500 .3048% .2982%
550 .3030% .2942%
FMR voluntarily adopted various additional Group Fee breakpoints for group
assets over $210 billion in 1994 and 1996. Although the new fee breakpoints
have not been added to the management contract pending shareholder
approval, FMR has voluntarily based its management fee on the Group Fee
schedule contained in the Amended Contract since January 1, 1996. Group
assets for May 1997 were approximately $482 billion.
MODIFICATIONS TO PERFORMANCE ADJUSTMENT - ROUNDING METHOD. The
annual Performance Adjustment rate equals 0.02% for each percentage point
by which the fund outperforms or underperforms the Index over a 36-month
performance period. Under the Present Contract, the investment performance
of both the fund and the Index are rounded to the nearest full percentage
point (for example, 15.5123% is rounded to 16%.) Rounding to full
percentage points results in the Performance Adjustment rate being applied
in 0.02% increments. In comparison, under the Amended Contract, the
investment performance of both the fund and Index are rounded to the
nearest 0.01% (using the prior example, 15.5123% is rounded to 15.51%)
prior to calculating the difference in investment performance. The more
precise rounding method results in a more accurate measure of the
difference in investment performance and allows for the Performance
Adjustment to be applied in 0.0002% increments. This reduces the chance of
minor changes in performance resulting in significant changes to the
Performance Adjustment, and ultimately the fund's management fee.
During fiscal 1996, using the more precise rounding methodology, the
impact on the annual performance fee rate would have been between 0.0299%
and (0.0299)% as a percentage of the fund's average net assets for the
year. The aggregate impact during fiscal 1996 was a 0.0023% decline in the
management fee.
COMPARISON OF MANAGEMENT FEES. The following table compares the fund's
management fee as calculated under the terms of the Present Contract (not
including FMR's voluntary implementation of the Group Fee reductions) for
fiscal 1996 to the management fee the fund would have incurred if the
Amended Contract had been in effect. Management fees are expressed in
dollars and as percentages of the fund's average net assets for the year.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Present Contract Amended Contract Difference
$ % $ % $ %
Basic
Fee 1,276,134 0 .7602 1,270,995 0.7572 (5 , 139) ( 0 .0030)
Performance
67,995 0 .0405 64,171 0.0382 (3 , 824) ( 0 .0023)
Adjustment
Total Management
Fee 1,344,129
0 .8007 1,335,166 0.7954 (8 , 963) ( 0 .0053)
</TABLE>
The following table provides data concerning the fund's management fees
and expenses as a percentage of average net assets for the fiscal year
ended October 31, 1996 under the Present Contract (not including FMR's
voluntary implementation of the Group Fee reductions) and if the Amended
Contract had been in effect during the same period.
The following figures are based on historical expenses adjusted to reflect
current fees of the fund and are calculated as a percentage of average net
assets.
COMPARATIVE FEE TABLE
ANNUAL FUND OPERATING EXPENSES (as a percentage of average net assets)
Present Contract Amended Contract
Management Fee 0.80 % 0.80%
Other Expenses 0.53 % 0.53%
Total Fund Operating Expenses 1.33 % 1.33%
A portion of the brokerage commissions that the fund pays is used to
reduce the fund's expenses. The fund has entered into arrangements with its
custodian and transfer agent whereby interest earned on uninvested cash
balances is used to offset a portion of the fund's expenses. Including
these reductions, the total operating expenses presented in the table would
have been 1.30 % under the Present Contract and 1.30 % under
the Amended Contract.
EXAMPLE: The following illustrates the expenses on a $1,000 investment
under the fees and expenses stated above, assuming (1) 5% annual return and
(2) redemption at the end of each time period and (3) payment of the fund's
3.00% sales charge:
1 Year 3 Years 5 Years 10 Years
Present Contract $ 43 $ 71 $ 101 $ 185
Amended Contract 43 71 101 185
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.
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) are 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 9, 1996. The Board of Trustees considered and approved
the modifications to the Group Fee Rate schedule during the two month
periods from November to December 1995, June to July 1994, and September to
October 1993, and the modifications to the Performance Adjustment
calculation during the period from June to July 1995. 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 Trustees receive materials specifically relating to the
Amended Contract. These materials include: (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, (iii) the economic outlook and the general
investment outlook in the markets in which the fund invests, and (iv)
notable changes in the fund's investments. 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 quality 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:
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.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the Independent
Trustees annually review a report detailing 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 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 market 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 benefitted 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 but determined that it would be appropriate to change the
group fee structure as proposed herein.
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, credit
card, 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.
OTHER 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.
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 modifications to the management fee rates, that is the reduction
of the Group Fee Rate schedule and the modifications to the performance
adjustment calculation, 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. If approved by shareholders, the Amended Contract will take
effect on the first day of the first month following approval.
10. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR FIDELITY JAPAN 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 Fidelity Japan Fund approve, a proposal
to adopt an amended management contract with FMR (the Amended Contract).
The Amended Contract modifies several aspects of the management fee that
FMR receives from the fund for managing its investments and business
affairs.
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 0.45%. The Basic Fee rate for the fund's
fiscal year ended October 31, 1996 (not including the fee amendments
discussed below) was 0.7 649 %.
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 Tokyo Stock Exchange Index (the Index) over 36 months,
FMR receives a positive Performance Adjustment, and if the fund
underperforms the Index, 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 of
outperformance or underperformance, subject to a maximum of 0.20% if the
fund outperforms or underperforms the Index by more than ten percentage
points. Performance of the fund and the Index are rounded to the nearest
whole percentage point for purposes of the calculation.
PROPOSED MANAGEMENT FEE AMENDMENTS. The Amended Contract would (1) reduce
the Group Fee rate further if FMR's assets under management remain over
$210 billion, and (2) modify the Performance Adjustment calculation to
round the performance of the fund and the Index to the nearest 0.01%,
rather than the nearest 1.00%.
IMPACT OF GROUP FEE RATE REDUCTION. At FMR's current level of assets under
management ($ 482 billion as of May 1997), the changes to the Group
Fee rate reduce the management fee. FMR has voluntarily implemented the
Group Fee reductions pending shareholder approval, and the fund has paid
lower management fees as a result. For the fund's fiscal year ended October
31, 1996, the management fee using the proposed Group Fee reductions
(including the Performance Adjustment) was 0.6812% of the fund's average
net assets. The Group Fee reductions lowered the management fee rate by
0.0074% compared to the rate FMR was entitled to receive under the Present
Contract ( 0.68 86 % ) .
IMPACT OF PERFORMANCE ADJUSTMENT CHANGES. The more precise rounding method
for the Performance Adjustment would have decreased the management fee rate
for the fiscal year ended October 31, 1996 by 0.0004 % of the Fund's
average net assets for the year.
COMBINED EFFECT OF FEE CHANGES. In the fiscal year ended October 31, 1996,
the Group Fee reductions and the changes to the Performance Adjustment
would have resulted in a 0.00 78 % reduction in the total management
fee. The future impact will depend on many different factors, and may
represent an increase or decrease from the management fee under the Present
Contract. The Group Fee rate reductions will either reduce the management
fee or leave it unchanged, depending on the level of FMR's assets under
management. Calculating performance to the nearest 0.01% may increase or
decrease the Performance Adjustment, depending on whether performance would
have been rounded up or down.
PRESENT AND AMENDED CONTRACTS. FMR is the fund's investment adviser
pursuant to a management contract dated July 16, 1992 which was approved by
FMR, then sole shareholder, on September 10, 1992. (For information on FMR,
see the section entitled "Activities and Management of FMR," on page .) A
copy of the Amended Contract, marked to indicate the proposed amendments,
is supplied as Exhibit on page . Except for the
modifications discussed above, the Amended Contract is substantially
identical to the fund's Present Contract with FMR. (For a detailed
discussion of the fund's Present Contract, refer to the section entitled
"Present Management Contracts," on page .) If approved by shareholders, the
Amended Contract will take effect on the first day of the first month
following approval and will remain in effect through July 31, 1998 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 is not approved, the Present Contract
will continue in effect through July 31, 1998, and thereafter only as long
as its continuance is approved at least annually as above.
MODIFICATION TO GROUP FEE RATE. The Group Fee rate varies based on the
aggregate net assets of all registered investment companies having
management contracts with FMR (group assets). As group assets increase, the
Group Fee rate declines. The Amended Contract would not change the Group
Fee rate if group assets are $210 billion or less. Above $210 billion in
group assets, the Group Fee rate declines under both contracts, but under
the Amended Contract, it declines faster.
The Group Fee rate is calculated according to a graduated schedule
providing for different rates for different levels of group assets. The
rate at which the Group Fee rate declines is determined by fee
"breakpoints" that provide for lower fee rates when group assets increase.
The Amended Contract would add 10 new, lower breakpoints applicable when
group assets are above $210 billion as illustrated in the following table.
(For an explanation of how the Group Fee rate is used to calculate the
management fee see the section entitled "Present Management Contracts" on
page .)
GROUP FEE RATE BREAKPOINTS
Average Group Present Group Amended
Assets Contract Assets Contract
($ billions) ($ billions)
Over 174 .3000% 174-210 .3000%
210-246 .2950%
246-282 .2900%
282-318 .2850%
318-354 .2800%
354-390 .2750%
390-426 .2700%
426-462 .2650%
462-498 .2600%
498-534 .2550%
Over 534 .2500%
The resulting Group Fee rates at various levels of group assets are
indicated below. (For an explanation of how the breakpoints are combined to
arrive at the Group Fee rate, see "Present Management Contracts" on page .)
EFFECTIVE GROUP FEE RATES
Group Present Amended
Assets Contract Contract
($ billions)
150 .3371% .3371%
200 .3284% .3284%
250 .3227% .3219%
300 .3190% .3163%
350 .3162% .3113%
400 .3142% .3067%
450 .3126% .3024%
500 .3114% .2982%
550 .3103% .2942%
FMR voluntarily adopted various additional Group Fee breakpoints for group
assets over $174 billion in 1993, 1994, and 1996. Although the new fee
breakpoints have not been added to the management contract pending
shareholder approval, FMR has voluntarily based its management fee on the
Group Fee schedule contained in the Amended Contract since January 1, 1996.
Group assets for May 1997 were approximately $ 482 billion.
MODIFICATIONS TO PERFORMANCE ADJUSTMENT - ROUNDING METHOD. The
annual Performance Adjustment rate equals 0.02% for each percentage point
by which the fund outperforms or underperforms the Index over a 36-month
performance period. Under the Present Contract, the investment performance
of both the fund and the Index are rounded to the nearest full percentage
point (for example, 15.5123% is rounded to 16%.) Rounding to full
percentage points results in the Performance Adjustment rate being applied
in 0.02% increments. In comparison, under the Amended Contract, the
investment performance of both the fund and Index are rounded to the
nearest 0.01% (using the prior example, 15.5123% is rounded to 15.51%)
prior to calculating the difference in investment performance. The more
precise rounding method results in a more accurate measure of the
difference in investment performance and allows for the Performance
Adjustment to be applied in 0.0002% increments. This reduces the chance of
minor changes in performance resulting in significant changes to the
Performance Adjustment, and ultimately the fund's management fee.
During fiscal 1996, using the more precise rounding methodology, the
impact on the annual performance fee rate would have been between 0.0172%
and (0.0 172 )% as a percentage of the fund's average net assets for
the year. The aggregate impact during fiscal 1996 was a 0.0004% decline in
the management fee.
COMPARISON OF MANAGEMENT FEES. The following table compares the fund's
management fee as calculated under the terms of the Present Contract (not
including FMR's voluntary implementation of the Group Fee reductions) for
fiscal 1996 to the management fee the fund would have incurred if the
Amended Contract had been in effect. Management fees are expressed in
dollars and as percentages of the fund's average net assets for the year.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Present Contract Amended Contract Difference
$ % $ % $ %
Basic
Fee 2,864,717 0.7649 2,836,844 0.7575 (27,873) (0.0074)
Performance
(285,740) (0.0763) (287,310) (0.0767) (1,570) (0.0004)
Adjustment
Total Management
Fee 2,578,977 0.6886 2,549,534 0.6808 (29,443) (0.0078)
</TABLE>
The following table provides data concerning the fund's management fees
and expenses as a percentage of average net assets for the fiscal year
ended October 31, 1996 under the Present Contract (not including FMR's
voluntary implementation of the Group Fee reductions) and if the Amended
Contract had been in effect during the same period.
The following figures are based on historical expenses adjusted to reflect
current fees of the fund and are calculated as a percentage of average net
assets.
COMPARATIVE FEE TABLE
ANNUAL FUND OPERATING EXPENSES (as a percentage of average net assets)
Present Contract Amended Contract
Management Fee 0.69 % 0.68%
Other Expenses 0.47 % 0.47%
Total Fund Operating Expenses 1.16% 1.15%
A portion of the brokerage commissions that the fund pays is used to
reduce the fund's expenses. The fund has entered into arrangements with its
custodian and transfer agent whereby interest earned on uninvested cash
balances is used to offset a portion of the fund's expenses. Including
these reductions, the total operating expenses presented in the table would
have been 1.15 % under the Present Contract and 1.14 % under
the Amended Contract.
EXAMPLE: The following illustrates the expenses on a $1,000 investment
under the fees and expenses stated above, assuming (1) 5% annual return and
(2) redemption at the end of each time period and (3) payment of the fund's
3.00% sales charge:
1 Year 3 Years 5 Years 10 Years
Present Contract $ 41 $ 66 $ 92 $ 167
Amended Contract 41 65 91 166
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.
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) are 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 the Independent Trustees on
October 9, 1996. The Board of Trustees considered and approved the
modifications to the Group Fee Rate schedule during the two month periods
from November to December 1995, June to July 1994, and September to October
1993, and the modifications to the Performance Adjustment calculation
during the period from June to July 1995. 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 Trustees receive materials specifically relating to the
Amended Contract. These materials include: (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, (iii) the economic outlook and the general
investment outlook in the markets in which the fund invests, and (iv)
notable changes in the fund's investments. 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 quality 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:
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.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the Independent
Trustees annually review a report detailing 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 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 market 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 benefitted 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 but determined that it would be appropriate to change the
group fee structure as proposed herein.
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, credit
card, 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.
OTHER 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.
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 modifications to the management fee rates, that is the reduction
of the Group Fee Rate schedule and the modifications to the performance
adjustment calculation, 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. If approved by shareholders, the Amended Contract will take
effect on the first day of the first month following approval .
11. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR FIDELITY SOUTHEAST ASIA
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 Fidelity Southeast Asia Fund approve, a
proposal to adopt an amended management contract with FMR (the Amended
Contract). The Amended Contract modifies several aspects of the management
fee that FMR receives from the fund for managing its investments and
business affairs.
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 0.45%. The Basic Fee rate for the fund's
fiscal year ended October 31, 1996 (not including the fee amendments
discussed below) was 0.7 644 %.
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 Morgan Stanley Capital International Combined Far East
ex-Japan Free Index (the Index) over 36 months, FMR receives a positive
Performance Adjustment, and if the fund underperforms the Index, 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 of outperformance or
underperformance, subject to a maximum of 0.20% if the fund outperforms or
underperforms the Index by more than ten percentage points. Performance of
the fund and the Index are rounded to the nearest whole percentage point
for purposes of the calculation.
PROPOSED MANAGEMENT FEE AMENDMENTS. The Amended Contract would (1) reduce
the Group Fee rate further if FMR's assets under management remain over
$210 billion, and (2) modify the Performance Adjustment calculation to
round the performance of the fund and the Index to the nearest 0.01%,
rather than the nearest 1.00%.
IMPACT OF GROUP FEE RATE REDUCTION. At FMR's current level of assets under
management ($ 482 billion as of May 1997), the changes to the Group
Fee rate reduce the management fee. FMR has voluntarily implemented the
Group Fee reductions pending shareholder approval, and the fund has paid
lower management fees as a result. For the fund's fiscal year ended October
31, 1996, the management fee using the proposed Group Fee reductions
(including the Performance Adjustment) was 0.6529% of the fund's average
net assets. The Group Fee reductions lowered the management fee rate by
0.0075% compared to the rate FMR was entitled to receive under the Present
Contract (0.6604%).
IMPACT OF PERFORMANCE ADJUSTMENT CHANGES. The more precise rounding method
for the Performance Adjustment would have increased the management fee rate
for the fiscal year ended October 31, 1996 by 0. 0002 % of the Fund's
average net assets for the year.
COMBINED EFFECT OF FEE CHANGES. In the fiscal year ended October 31, 1996,
the Group Fee reductions and the changes to the Performance Adjustment
would have resulted in a 0.0073% reduction in the total management fee. The
future impact will depend on many different factors, and may represent an
increase or decrease from the management fee under the Present Contract.
The Group Fee rate reductions will either reduce the management fee or
leave it unchanged, depending on the level of FMR's assets under
management. Calculating performance to the nearest 0.01% may increase or
decrease the Performance Adjustment, depending on whether performance would
have been rounded up or down.
PRESENT AND AMENDED CONTRACTS. FMR is the fund's investment adviser
pursuant to a management contract dated March 18, 1993 which was approved
by FMR, then sole shareholder, on March 23, 1993. (For information on FMR,
see the section entitled "Activities and Management of FMR," on page .) A
copy of the Amended Contract, marked to indicate the proposed amendments,
is supplied as Exhibit on page . Except for the
modifications discussed above, the Amended Contract is substantially
identical to the fund's Present Contract with FMR. (For a detailed
discussion of the fund's Present Contract, refer to the section entitled
"Present Management Contracts," on page .) If approved by shareholders, the
Amended Contract will take effect on the first day of the first month
following approval and will remain in effect through July 31, 1998 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 is not approved, the Present Contract
will continue in effect through July 31, 1998, and thereafter only as long
as its continuance is approved at least annually as above.
MODIFICATION TO GROUP FEE RATE. The Group Fee rate varies based on the
aggregate net assets of all registered investment companies having
management contracts with FMR (group assets). As group assets increase, the
Group Fee rate declines. The Amended Contract would not change the Group
Fee rate if group assets are $210 billion or less. Above $210 billion in
group assets, the Group Fee rate declines under both contracts, but under
the Amended Contract, it declines faster.
The Group Fee rate is calculated according to a graduated schedule
providing for different rates for different levels of group assets. The
rate at which the Group Fee rate declines is determined by fee
"breakpoints" that provide for lower fee rates when group assets increase.
The Amended Contract would add 10 new, lower breakpoints applicable when
group assets are above $210 billion as illustrated in the following table.
(For an explanation of how the Group Fee rate is used to calculate the
management fee see the section entitled "Present Management Contracts" on
page .)
GROUP FEE RATE BREAKPOINTS
Average Group Present Group Amended
Assets Contract Assets Contract
($ billions) ($ billions)
Over 174 .3000% 174-210 .3000%
210-246 .2950%
246-282 .2900%
282-318 .2850%
318-354 .2800%
354-390 .2750%
390-426 .2700%
426-462 .2650%
462-498 .2600%
498-534 .2550%
Over 534 .2500%
The resulting Group Fee rates at various levels of group assets are
indicated below. (For an explanation of how the breakpoints are combined to
arrive at the Group Fee rate, see "Present Management Contracts" on page .)
EFFECTIVE GROUP FEE RATES
Group Present Amended
Assets Contract Contract
($ billions)
150 .3371% .3371%
200 .3284% .3284%
250 .3227% .3219%
300 .3190% .3163%
350 .3162% .3113%
400 .3142% .3067%
450 .3126% .3024%
500 .3114% .2982%
550 .3103% .2942%
FMR voluntarily adopted various additional Group Fee breakpoints for group
assets over $174 billion in 1993, 1994, and 1996. Although the new fee
breakpoints have not been added to the management contract pending
shareholder approval, FMR has voluntarily based its management fee on the
Group Fee schedule contained in the Amended Contract since January 1, 1996.
Group assets for May 1997 were approximately $ 482 billion.
MODIFICATIONS TO PERFORMANCE ADJUSTMENT - ROUNDING METHOD. The
annual Performance Adjustment rate equals 0.02% for each percentage point
by which the fund outperforms or underperforms the Index over a 36-month
performance period. Under the Present Contract, the investment performance
of both the fund and the Index are rounded to the nearest full percentage
point (for example, 15.5123% is rounded to 16%.) Rounding to full
percentage points results in the Performance Adjustment rate being applied
in 0.02% increments. In comparison, under the Amended Contract, the
investment performance of both the fund and Index are rounded to the
nearest 0.01% (using the prior example, 15.5123% is rounded to 15.51%)
prior to calculating the difference in investment performance. The more
precise rounding method results in a more accurate measure of the
difference in investment performance and allows for the Performance
Adjustment to be applied in 0.0002% increments. This reduces the chance of
minor changes in performance resulting in significant changes to the
Performance Adjustment, and ultimately the fund's management fee.
During fiscal 1996, using the more precise rounding methodology, the
impact on the annual performance fee rate would have been between 0.0159%
and (0.0159)% as a percentage of the fund's average net assets for the
year. The aggregate impact during fiscal 1996 was a 0.0002% increase in the
management fee.
COMPARISON OF MANAGEMENT FEES. The following table compares the fund's
management fee as calculated under the terms of the Present Contract (not
including FMR's voluntary implementation of the Group Fee reductions) for
fiscal 1996 to the management fee the fund would have incurred if the
Amended Contract had been in effect. Management fees are expressed in
dollars and as percentages of the fund's average net assets for the year.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Present Contract Amended Contract Difference
$ % $ % $ %
Basic
Fee 6,488,368 0.7644 6,424,434 0.7569 (63,934) (0.0075)
Performance
(882,709) (0.1040) (880,721) (0.1038) 1,988 0.0002
Adjustment
Total Management
Fee 5,605,659 0.6604 5,543,713 0.6531 (61,946) (0.0073)
</TABLE>
The following table provides data concerning the fund's management fees
and expenses as a percentage of average net assets for the fiscal year
ended October 31, 1996 under the Present Contract (not including FMR's
voluntary implementation of the Group Fee reductions) and if the Amended
Contract had been in effect during the same period.
The following figures are based on historical expenses adjusted to reflect
current fees of the fund and are calculated as a percentage of average net
assets.
COMPARATIVE FEE TABLE
ANNUAL FUND OPERATING EXPENSES (as a percentage of average net assets)
Present Contract Amended Contract
Management Fee 0.66 % 0.65%
Other Expenses 0.48 % 0.48%
Total Fund Operating Expenses 1.14 % 1.13%
A portion of the brokerage commissions that the fund pays is used to
reduce the fund's expenses. The fund has entered into arrangements with its
custodian and transfer agent whereby interest earned on uninvested cash
balances is used to offset a portion of the fund's expenses. Including
these reductions, the total operating expenses presented in the table would
have been 1.13 % under the Present Contract and 1.12 % under
the Amended Contract.
EXAMPLE: The following illustrates the expenses on a $1,000 investment
under the fees and expenses stated above, assuming (1) 5% annual return and
(2) redemption at the end of each time period and (3) payment of the fund's
3.00% sales charge:
1 Year 3 Years 5 Years 10 Years
Present Contract $ 41 $ 65 $ 91 $ 164
Amended Contract 41 65 90 163
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.
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) are 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 the Independent Trustees on
October 9, 1996. The Board of Trustees considered and approved the
modifications to the Group Fee Rate schedule during the two month periods
from November to December 1995, June to July 1994, and September to October
1993, and the modifications to the Performance Adjustment calculation
during the period from June to July 1995. 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 Trustees receive materials specifically relating to the
Amended Contract. These materials include: (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, (iii) the economic outlook and the general
investment outlook in the markets in which the fund invests, and (iv)
notable changes in the fund's investments. 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 quality 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:
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.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the Independent
Trustees annually review a report detailing 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 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 market 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 benefitted 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 but determined that it would be appropriate to change the
group fee structure as proposed herein.
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, credit
card, 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.
OTHER 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.
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 modifications to the management fee rates, that is the reduction
of the Group Fee Rate schedule and the modifications to the performance
adjustment calculation, 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. If approved by shareholders, the Amended Contract will take
effect on the first day of the first month following approval.
12. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR FIDELITY LATIN AMERICA
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 Fidelity Latin America Fund approve, a
proposal to adopt an amended management contract with FMR (the Amended
Contract). The Amended Contract modifies the management fee that
FMR receives from the fund to provide for lower fees when FMR's assets
under management exceed certain levels. THE AMENDED CONTRACT WILL RESULT IN
A MANAGEMENT FEE THAT IS THE SAME AS, OR LOWER THAN, THE FEE PAYABLE UNDER
THE PRESENT MANAGEMENT CONTRACT (THE PRESENT CONTRACT). (For information on
FMR, see the section entitled "Activities and Management of FMR" on page .)
PROPOSED AMENDMENT TO THE PRESENT MANAGEMENT CONTRACT. A Copy of the
Amended Contract, marked to indicate the proposed amendment, is supplied as
Exhibit 6 on page . Except for the modifications discussed above, it is
substantially identical to the Present Contract. (For a detailed discussion
of the fund's Present Contract, refer to the section entitled "Present
Management Contracts" beginning on page .) If approved by shareholders, the
Amended Contract will take effect on the first day of the first month
following approval and will remain in effect through July 31, 1998 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 those Trustees who are not "interested persons"
of the trust or FMR (the Independent Trustees) and (ii) the vote of either
a majority of the Trustees or by the vote of a majority of the outstanding
shares of the fund. If an Amended Contract is not approved, the Present
Contract will continue in effect through July 31, 1998, and thereafter 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 by the vote of a majority of the outstanding shares of the fund.
The management fee is an annual percentage of the fund's average net
assets (the management fee rate), calculated and paid monthly. The
management fee rate is the sum of two components: a Group Fee Rate, which
varies according to assets under management by FMR, and a fixed Individual
Fund Fee Rate. The Amended Contract modifies the Group Fee Rate by
providing for lower fee rates if FMR's assets under management remain above
$210 billion.
MODIFICATION TO GROUP FEE RATE. The Group Fee Rate varies based upon the
monthly average of the aggregate net assets of all registered investment
companies having management contracts with FMR (assets under management by
FMR). For example, as assets under management by FMR increase, the Group
Fee Rate declines. The Amended Contract would not change the group fee
calculation for assets under management by FMR of $210 billion or less.
Above $210 billion in assets under FMR's management, the Group Fee Rate
declines under both the Present Contract and the Amended Contact, but under
the Amended Contract, it declines faster. Group Fee Rates that are lower
than those contained in the fund's Present Contract have been voluntarily
implemented by FMR on November 1, 1993, August 1, 1994, and January 1,
1996.
The Group Fee Rate is calculated according to a graduated schedule
providing for different rates for different levels of assets under
management by FMR. The rate at which the Group Fee Rate declines is
determined by fee "breakpoints" that provide for lower fee rates when
assets increase. The Amended Contract adds 10 new fee breakpoints for
assets under FMR's management above $210 billion as illustrated in the
following table. (For an explanation of how the Group Fee Rate is used to
calculate the management fee, see the section entitled "Present Management
Contracts" beginning on page .)
GROUP FEE RAT E BREAKPOINTS
PRESENT CONTRACT AMENDED CONTRACT
Average Group Present Average Group Amended
Assets Contract* Assets Contract
($ billions) ($ billions)
Over 174 .3000% 174 - 210 .3000%
210 - 246 .2950%
246 - 282 .2900%
282 - 318 .2850%
318 - 354 .2800%
354 - 390 .2750%
390 - 426 .2700%
426 - 462 .2650%
462 - 498 .2600%
498 - 534 .2550%
Over 534 .2500%
The result at various levels of group net assets is illustrated by the
table below.
EFFECTIVE GROUP FEE RATES
Group Net Present Amended
Assets Contract* Contract
($ billions)
150 .3371% .3371%
200 .3284% .3284%
250 .3227% .3219%
300 .3190% .3163%
350 .3162% .3113%
400 .3142% .3067%
450 .3126% .3024%
500 .3114% .2982%
550 .3103% .2942%
* Does not reflect voluntary adoption of extended group fee rate schedules
by FMR on November 1, 1993, August 1, 1994, and January 1, 1996.
Assets under FMR's management for May 1997 were approximately $482
billion.
COMPARISON OF MANAGEMENT FEES. For May 1997, average assets under
management by FMR were $482 billion. The fund's management fee rate under
the Amended Contract would have been 0.7497%, compared to 0.7618% under the
Present Contract. The management fee rate will remain the same under both
the Present Contract and the Amended Contract until assets under FMR's
management exceed $210 billion, at which point the management fee rate
under the Amended Contract begins to decline relative to the Present
Contract. The following chart compares the fund's management fee under the
terms of the Present Contract for the fiscal year ended October
31, 1996 to the management fee the fund would have incurred if the
Amended Contract had been in effect.
Present Contract Amended Contract
Management Management Percentage
Fee* Fee Difference
$ 4,626,188 $ 4,580,255 (0.99%)
* Does not reflect voluntary adoption of extended group fee rate schedules
by FMR on November 1, 1993, August 1, 1994, and
January 1, 1996.
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 each 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) are 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 the Independent Trustees on
October 9, 1996. The Board of Trustees considered and approved the
modifications to the Group Fee Rate schedule during the two month periods
from November to December 1995, June to July 1994, and September to October
1993. 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 Trustees receive materials specifically relating to the
Amended Contract. These materials include: (i) information on the
investment performance of each fund, a peer group of funds and an
appropriate index or combination of indices, (ii) sales and redemption data
in respect of each fund, (iii) the economic outlook and the general
investment outlook in the markets in which each fund invests, and (iv)
notable changes in each fund's investments. 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 each fund's shares, (3) the procedures employed to
determine the value of each fund's assets, (4) the allocation of each
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 each fund's custodian and subcustodians, (6) the
resources devoted to and the record of compliance with each fund's
investment policies and restrictions and with policies on personal
securities transactions and (7) the nature, cost, and quality 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 each 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:
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.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the Independent
Trustees annually review a report detailing the background of each fund's
portfolio manager, and each 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 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 each 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 each 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 market
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 benefitted 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 but determined that it would be appropriate to change the
group fee structure as proposed herein.
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, credit
card, 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 each fund.
OTHER 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.
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 modifications to the management fee rates, that is the reduction
of the Group Fee Rate schedule, 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. If approved by shareholders, the Amended Contract will take
effect on the first day of the first month following approval .
13. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR EACH OF FIDELITY FRANCE
FUND, FIDELITY GERMANY FUND, FIDELITY HONG KONG AND CHINA FUND, FIDELITY
JAPAN SMALL COMPANIES FUND, FIDELITY NORDIC FUND, AND FIDELITY UNITED
KINGDOM 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 Fidelity France Fund, Fidelity Germany
Fund, Fidelity Hong Kong and China Fund, Fidelity Japan Small Companies
Fund, Fidelity Nordic Fund, and Fidelity United Kingdom Fund approve, a
proposal to adopt an amended management contract with FMR (the Amended
Contracts). The Amended Contracts modif ies the management fee
that FMR receives from each fund to provide for lower fees when FMR's
assets under management exceed certain levels. THE AMENDED CONTRACTS WILL
RESULT IN A MANAGEMENT FEE THAT IS THE SAME AS, OR LOWER THAN, THE FEE
PAYABLE UNDER THE PRESENT MANAGEMENT CONTRACTS (THE PRESENT CONTRACTS).
(For information on FMR, see the section entitled "Activities and
Management of FMR" on page .)
PROPOSED AMENDMENTS TO THE PRESENT MANAGEMENT CONTRACTS. A Copy of the
Amended Contract, marked to indicate the proposed amendments, is supplied
as Exhibit 7 on page . Except for the modifications discussed above, it is
substantially identical to the Present Contracts. (For a detailed
discussion of each fund's Present Contract, refer to the section entitled
"Present Management Contracts" beginning on page .) If approved by
shareholders, each Amended Contract will take effect on the first day of
the first month following approval and will remain in effect through July
31, 1998 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 those Trustees who are not "interested persons"
of the trust or FMR (the Independent Trustees) and (ii) the vote of either
a majority of the Trustees or by the vote of a majority of the outstanding
shares of the fund. If an Amended Contract is not approved, the Present
Contract will continue in effect through July 31, 1998, and thereafter 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 by the vote of a majority of the outstanding shares of the fund.
The management fee is an annual percentage of a fund's average net assets
(the management fee rate), calculated and paid monthly. The management fee
rate is the sum of two components: a Group Fee Rate, which varies according
to assets under management by FMR, and a fixed Individual Fund Fee Rate.
Each Amended Contract modifies the Group Fee Rate by providing for lower
fee rates if FMR's assets under management remain above $426 billion.
MODIFICATION TO GROUP FEE RATE. The Group Fee Rate varies based upon the
monthly average of the aggregate net assets of all registered investment
companies having management contracts with FMR (assets under management by
FMR). For example, as assets under management by FMR increase, the Group
Fee Rate declines. Each Amended Contract would not change the group fee
calculation for assets under management by FMR of $426 billion or less.
Above $426 billion in assets under FMR's management, the Group Fee Rate
declines under both the Present Contract and the Amended Contact, but under
the Amended Contract, it declines faster. Group Fee Rates that are lower
than those contained in each fund's Present Contract have been voluntarily
implemented by FMR on January 1, 1996.
The Group Fee Rate is calculated according to a graduated schedule
providing for different rates for different levels of assets under
management by FMR. The rate at which the Group Fee Rate declines is
determined by fee "breakpoints" that provide for lower fee rates when
assets increase. Each Amended Contract adds four new fee breakpoints
for assets under FMR's management above $426 billion as illustrated in the
following tables. (For an explanation of how the Group Fee Rate is used to
calculate the management fee, see the section entitled "Present Management
Contracts" beginning on page .)
GROUP FEE RA TE BREAKPOINTS
PRESENT CONTRACTS AMENDED CONTRACTS
Average Group Present Average Group Amended
Assets Contracts* Assets Contracts
($ billions) ($ billions)
Over 390 .2700% 390 - 426 .2700%
426 - 462 .2650%
462 - 498 .2600%
498 - 534 .2550%
Over 534 .2500%
The result at various levels of group net assets is illustrated by the
table below.
EFFECTIVE GROU P FEE RATES
Group Net Present Amended
Assets Contracts* Contracts
($ billions)
150 .3371% .3371%
200 .3284% .3284%
250 .3219% .3219%
300 .3163% .3163%
350 .3113% .3113%
400 .3067% .3067%
450 .3026% .3024%
500 .2994% .2982%
550 .2967% .2942%
* Does not reflect voluntary adoption of extended group fee rate schedules
by FMR on January 1, 1996.
Assets under FMR's management for May 1997 were approximately $ 482
billion.
COMPARISON OF MANAGEMENT FEES. For May 1997, average assets under
management by FMR were $ 482 billion. Each fund's management fee rate
under the Amended Contract would have been 0.7497 %, compared to
0.7514 % under the Present Contracts of each of the funds. The
management fee rate will remain the same under both the Present Contracts
and the Amended Contracts until assets under FMR's management exceed $426
billion, at which point the management fee rate under the Amended Contracts
begins to decline relative to the Present Contracts. The following charts
compare each fund's management fee under the terms of the Present
Contract s for the fiscal year ended October 31, 1996
to the management fee the fund would have incurred if the Amended Contract
had been in effect.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Present Contract Amended Contract
Management Management Percentage
Fee* Fee Difference
FRANCE FUND $ 41,012 $ 41,011 0.0000%
GERMANY FUND $ 41,320 $ 41,319 0.0000%
HONG KONG AND CHINA FUND $ 439,696 $ 439,689 0.0000%
JAPAN SMALL COMPANIES FUND $ 789,882 $ 789,872 0.0000%
NORDIC FUND $ 71,160 $ 71,158 0.0000%
UNITED KINGDOM FUND $ 15,497 $ 15,497 0.0000%
</TABLE>
* Does not reflect voluntary adoption of extended group fee rate schedules
by FMR on January 1, 1996.
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 each 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) are 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 Contracts to shareholders was approved
by the Board of Trustees of each fund, including the Independent Trustees,
on October 9, 1996. The Board of Trustees considered and approved the
modifications to the Group Fee Rate schedule during the two month periods
from November to December 1995, June to July 1994, and September to October
1993. The Board of Trustees received materials relating to the Amended
Contract s in advance of the meeting at which the Amended
Contract s w ere 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 Trustees receive materials specifically relating to the
Amended Contracts. These materials include: (i) information on the
investment performance of each fund, a peer group of funds and an
appropriate index or combination of indices, (ii) sales and redemption data
in respect of each fund, (iii) the economic outlook and the general
investment outlook in the markets in which each fund invests, and (iv)
notable changes in each fund's investments. 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 each fund's shares, (3) the procedures employed to
determine the value of each fund's assets, (4) the allocation of each
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 each fund's custodian and subcustodians, (6) the
resources devoted to and the record of compliance with each fund's
investment policies and restrictions and with policies on personal
securities transactions and (7) the nature, cost, and quality 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 each fund's shareholders.
In considering the Amended Contracts, 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 Contracts include
the following:
INVESTMENT COMPLIANCE AND PERFORMANCE. The Board of Trustees and the
Independent Trustees considered whether each fund has operated within its
investment objective and its record of compliance with its investment
restrictions. They also reviewed monthly each 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.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the Independent
Trustees annually review a report detailing the background of each fund's
portfolio manager, and each 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 Amended Contracts 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
each 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 each fund. This consideration included an
extensive review of FMR's methodology in allocating its costs to the
management of each 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 each fund and whether the amount of profit is a fair
entrepreneurial profit for the management of each fund. They also
considered the profits realized from non-fund businesses which may benefit
from or be related to each 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 market
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
these funds) have appropriately benefitted 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 but determined that it would be appropriate to change the
group fee structure as proposed herein.
OTHER BENEFITS TO FMR. The Board of Trustees and the Independent Trustees
also considered the character and amount of fees paid by each fund and each
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, credit
card, 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 each fund.
OTHER 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.
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 modifications to the management fee rates, that is the reduction
of the Group Fee Rate schedules, are in the best interest of each fund's
shareholders. The Board of Trustees, including the Independent Trustees,
voted to approve the submission of the Amended Contracts to shareholders of
each fund and recommends that shareholders of each fund vote FOR the
Amended Contract. If approved by shareholders, each Amended Contract will
take effect on the first day of the first month following approval .
14. TO APPROVE A NEW SUB-ADVISORY AGREEMENT BETWEEN FIDELITY DIVERSIFIED
INTERNATIONAL FUND AND FIDELITY INVESTMENTS JAPAN LIMITED .
In conjunction with its portfolio management responsibilities on behalf of
Diversified International Fund, FMR has entered into sub-advisory
agreements with affiliates whose offices are geographically dispersed
around the world. To strengthen these relationships, the Board of Trustees
proposes that shareholders of Fidelity Diversified International Fund
approve a sub-advisory agreement (the Proposed Agreement) between FIJ and
FMR on behalf of the fund. The Proposed Agreement would allow FMR not only
to receive investment advice and research services from FIJ, but also would
permit FMR to grant FIJ investment management authority if FMR believes it
would be beneficial to the fund and its shareholders. BECAUSE FMR WOULD PAY
ALL OF FIJ'S FEES, THE PROPOSED AGREEMENT WOULD NOT AFFECT THE FEES PAID BY
THE FUND TO FMR. In addition, the Proposed Agreement includes a discussion
of FIJ's ability to use brokers and dealers to execute portfolio
transactions, consistent with the authority granted FMR under the
Management Contract.
On October 9, 1996, the Board of Trustees agreed to submit the Proposed
Agreement to shareholders of the fund pursuant to a unanimous vote of both
the full Board of Trustees and those Trustees who were not "interested
persons" of the trust or FMR. FMR provided substantial information to the
Trustees to assist them in their deliberations. The Trustees determined
that allowing FMR to receive investment advice and research services from
FIJ as well as to grant investment management authority to FIJ would
provide FMR increased flexibility in the assignment of portfolio managers
and give the fund access to managers located abroad who may have more
specialized expertise with respect to local companies and markets.
Additionally, the Trustees believe that the fund and its shareholders may
benefit from giving FMR, through FIJ, the ability to execute portfolio
transactions from points in Japan that are physically closer to foreign
issuers and the primary markets in which their securities are traded.
Increasing FMR's proximity to foreign markets should enable the fund to
participate more readily in full trading sessions on foreign exchanges, and
to react more quickly to changing market conditions. A copy of the Proposed
Agreement is attached to this proxy statement as Exhibit 8.
FIJ, established in 1986 with its principal office in Tokyo, Japan, is a
wholly-owned subsidiary of Fidelity International Limited (FIL), an
affiliate of FMR organized under the laws of Bermuda. In 1994, FIJ
registered as an investment advisor with the SEC in order to provide
investment advisory services to FMR with respect to foreign securities,
primarily Japanese securities. This research complements other research on
foreign securities produced by FMR's U.S.-based research analysts and
portfolio managers, obtained from other FMR subsidiaries or affiliates with
whom FMR has entered into sub-advisory agreements, or obtained from
broker-dealers or other sources.
FIJ may also provide investment advisory and management services to FMR
with respect to other investment companies for which FMR serves as
investment adviser, and to other clients. Currently, FIJ's only client
other than FMR is FIL. FIL provides investment advisory services to
non-U.S. investment companies and institutional investors investing in
securities of issuers throughout the world. Edward C. Johnson 3d, President
and a Trustee of the trust, is Chairman and a Director of FIJ, Chairman,
and a Director of FIL, and a principal stockholder of both FIL and FMR. For
more information on FIJ, see the section entitled "Activities and
Management of FIJ, FIIA, and FIIAL U.K." on page .
Under the Proposed Agreement, FIJ could act as an investment consultant to
FMR and could supply FMR with investment research information and portfolio
management advice as FMR reasonably requests on behalf of the fund. FIJ
would provide investment advice and research services with respect to
issuers located outside of the United States focusing primarily on
companies based in the Far East. Under the Proposed Agreement with FIJ,
FMR, NOT THE FUND, would pay FIJ 30% of FMR's monthly management fee with
respect to the average market value of investments held by the fund for
which FIJ shall have provided investment advice.
Under the Proposed Agreement, FMR could also grant investment management
authority with respect to all or a portion of the fund's assets to FIJ. If
FIJ were to exercise investment management authority on behalf of the fund,
it would be required, subject to the supervision of FMR, to direct the
investments of the fund in accordance with the fund's investment objective,
policies, and limitations as provided in the fund's prospectus or other
governing instruments and such other limitations as the fund may impose by
notice in writing to FMR or FIJ. If FMR grants investment management
authority to FIJ with respect to all or a portion of the fund's assets, FIJ
would be authorized to buy or sell stocks, bonds, and other securities for
the fund subject to the overall supervision of FMR and the Board of
Trustees. In addition, the Proposed Agreement would authorize FMR to
delegate other investment management services to FIJ, including, but not
limited to, currency management services (including buying and selling
currency options and entering into currency forward and futures contracts
on behalf of the fund), other transactions in futures contracts and
options, and borrowing or lending portfolio securities. If any of these
investment management services were delegated, FIJ would continue to be
subject to the control and direction of FMR and the Board of Trustees and
to be bound by the investment objective, policies, and limitations of the
fund.
To the extent that FMR granted investment management authority to FIJ, FMR
would pay FIJ 50% of its monthly management fee with respect to the average
net assets managed on a discretionary basis by FIJ for investment
management services.
If approved by shareholders, the Proposed Agreement would take effect on
the first day of the first month following approval and would continue in
force until July 31, 1998 and from year to year thereafter, but only as
long as its continuance was approved at least annually by (i) the vote,
cast in person at a meeting called for the purpose, of a majority of those
Trustees who are not "interested persons" of the trust or FMR and (ii) the
vote of either a majority of the Trustees or by the vote of a majority of
the outstanding shares of the fund.
The Proposed Agreement could be transferred to a successor of FIJ without
resulting in its termination and without shareholder approval, as long as
the transfer did not constitute an assignment under applicable securities
laws and regulations. The Proposed Agreement would be terminable on 60
days' written notice by either party to the agreement and the Proposed
Agreement would terminate automatically in the event of its assignment.
CONCLUSION. The Board of Trustees has concluded that the proposal will
benefit Diversified International Fund and its shareholders. The Trustees
recommend voting FOR the proposal. If approved by shareholders, the
Proposed Agreement would take effect on the first day of the first month
following approval. If the Proposed Agreement is not approved, FMR will
continue to manage the fund under its Management Contract with the
flexibility to use subadvisors, excluding FIJ, as previously approved.
15. TO APPROVE A DISTRIBUTION AND SERVICE PLAN PURSUANT TO RULE 12B-1 FOR
EACH OF FIDELITY DIVERSIFIED INTERNATIONAL FUND AND FIDELITY
INTERNATIONAL VALUE FUND.
The Board of Trustees has approved, and recommends that shareholders of
Fidelity Diversified International Fund and Fidelity International Value
Fund approve, a Distribution and Service Plan (The Plan) for the funds. A
copy of the Plan is attached to this Proxy Statement as Exhi bit 9 .
THE PLAN. The Plan was approved by the Board as provided for by Rule 12b-1
(the Rule) promulgated by the Securities and Exchange Commission (SEC)
under the Investment Company Act of 1940 (the 1940 Act). The Rule provides
that an investment company (e.g., a mutual fund) acting as a distributor of
its shares must do so pursuant to a written Plan "describing all material
aspects of the proposed financing of distribution.'' Under the Rule, an
investment company is deemed to be acting as a distributor of its shares if
it engages "directly or indirectly in financing any activity which is
primarily intended to result in the sale of shares issued by such company,
including, but not necessarily limited to, advertising, compensation of
underwriters, dealers, and sales personnel, the printing and mailing of
prospectuses to other than current shareholders, and the printing and
mailing of sales literature.''
The Plan is designed to avoid legal uncertainties which may arise
from the ambiguity of the phrase "primarily intended to result in the sale
of shares'' and from the term "indirectly'' as used in the Rule. The SEC
has neither approved nor disapproved the Plan.
The Plan contemplates that all expenses relating to the
distribution of fund shares shall be paid for by FMR, or Fidelity
Distributors Corporation (FDC), a wholly owned subsidiary of FMR Corp., out
of past profits and other resources, including management fees paid by a
fund to FMR. The Plan also recognizes that FMR, either directly or through
FDC, may make payments from these sources to securities dealers and to
other third parties who engage in the sale of fund shares or who render
shareholder services. Each Plan provides that, to the extent that the
fund's payment of management fees to FMR might be considered to constitute
the "indirect'' financing of activities "primarily intended to result in
the sale of shares,'' such payment is expressly authorized. THE PLAN
DOES NOT AUTHORIZE PAYMENTS BY THE FUND OTHER THAN THOSE THAT ARE TO BE
MADE TO FMR UNDER ITS MANAGEMENT CONTRACT.
Each fund may execute portfolio transactions with, and purchase
securities issued by, depository institutions that receive payments under
the Plans. No preference for the instruments of such depository
institutions will be shown in the selection of investments.
Although each Plan contemplates that FMR and FDC may engage in various
distribution activities, it does not require them to perform any specific
type of distribution activity or to incur any specific level of expense for
such activities.
Each fund's Plan contains a number of provisions relating to
reporting obligations and to its amendment and termination as required by
the Rule. If approved by shareholders, the Plan will continue in effect as
long as its continuance is specifically approved at least annually by a
majority of the Board of Trustees, including a majority of the Trustees who
are not "interested persons'' of the trust and who have no direct or
indirect financial interest in the operation of the Plan or any agreement
related to the Plan (the non-interested Trustees), cast in person at a
meeting called for the purpose of voting on the Plan. The Plan may be
amended at any time by the Trustees, except that it may not be amended to
authorize direct payments by the fund to finance any activity primarily
intended to result in the sale of shares issued by the fund or to increase
materially the amount spent by the fund for distribution without the
approval of a majority of the outstanding shares of the fund and the
Trustees. In addition, any amendment of a fund's Management Contract to
increase the amount paid by the fund to FMR shall be effective only upon
approval by vote of a majority of the outstanding voting securities of that
fund. All material amendments to a Plan also must be approved by a majority
of the non-interested Trustees. Each Plan, and any agreements related to
the Plan, may be terminated at any time by a vote of the majority of the
non-interested Trustees or by a vote of the majority of the outstanding
shares of each respective fund. The Plan requires that the Trustees
receive, at least quarterly, a written report as to the amounts expended
during the quarter by FMR, or FDC, in connection with financing any
activity primarily intended to result in the sale of shares issued by each
fund, and the purposes for which such expenditures were made. As required
by the Rule, while the Plan is in effect, the selection and nomination of
those Trustees who are not "interested persons" shall be committed to the
discretion of the non-interested Trustees then in office.
TRUSTEE CONSIDERATION. In determining to recommend the adoption of each
Plan, the Board considered a variety of factors and was advised by counsel
who are not counsel to FMR or FDC. The Trustees believe that the fees paid
by the funds to FMR under the Management Contract, are fair and reasonable,
that the services provided thereunder are necessary and appropriate for
each fund and its shareholders, and that each fund does not indirectly
finance the distribution of its shares in contravention of the Rule.
Nonetheless, the Trustees concluded that adoption of the Plan would avoid
legal uncertainties which might arise as a result of what they and FMR
believes to be potentially subjective and ambiguous language contained in
the Rule and in public releases issued by the SEC in connection with the
proposal and adoption of the Rule (SEC Releases). The Trustees believe that
the adoption of the Plan is advisable to minimize such legal
uncertainties and to provide other benefits to each fund and its
shareholders.
The Trustees noted that each fund's Plan does not involve any direct
payment by each fund to finance any activity primarily intended to
result in the sale of shares issued by the fund, and that any amendment of
the fund's Management Contract with FMR to increase the amount paid by the
fund thereunder would require approval of both the Trustees and the fund's
shareholders. The Trustees also considered the factors suggested in the SEC
Releases including: the need for independent counsel or experts to assist
the Trustees in reaching a determination; the nature and causes of the
problems and circumstances which made consideration of a Plan appropriate;
the way in which a Plan would resolve or alleviate the problems, including
the nature and approximate amount of the expenditures contemplated by
the Plan; the merits of possible alternatives to the Plan; the
interrelationship between the Plan and the activities of FMR in
financing the distribution of each fund's shares; the possible
benefits of the Plan to FMR and its affiliates relative to those
expected to accrue to each fund; and consequently the effects of
the Plan on existing shareholders.
The reduction in legal uncertainties arising from the potentially
subjective and ambiguous language that appears in the Rule and in the SEC
Releases enables the Trustees, in connection with their review of each
fund's Management Contract with FMR, to consider the full range of services
provided by FMR and FDC, including services which may be related to the
distribution of the fund's shares. In addition, the Board of Trustees
considered alternatives to the Plan, including direct payments by a fund to
FDC and/or third parties and the implementation of a sales load. The
Trustees believe it is appropriate to ensure that FMR and FDC have the
flexibility to direct their distribution activities in a manner consistent
with prevailing market conditions by using, subject to approval of the
Trustees, their resources, including the current management fee, to make
payments to third parties. To the extent that FMR has greater flexibility
under each Plan, additional sales of the fund's shares may result. The
Trustees believe that this flexibility has the potential to benefit the
fund by reducing the possibility that the fund would experience net
redemptions, which might require the liquidation of portfolio securities in
amounts and at times that could be disadvantageous for investment purposes.
Of course, there can be no assurance that these events will occur.
The Board of Trustees recognized that a greater level of fund assets
benefits FMR by increasing its management fee revenues. The Board noted the
high quality of investment management services and the expansion of, and
many innovations in, investor services that have been provided by FMR over
the years. The Board believes that revenues received by FMR contribute to
its continuing ability to attract and retain a high caliber of investment
and other personnel and to develop and implement new systems for providing
services and information to shareholders. The Board considers this ability
to be an important benefit to each fund and its shareholders.
CONCLUSION. For the reasons stated above, the members of the Board of
Trustees unanimously concluded in the exercise of their business judgment
and in light of their fiduciary duties under state law and the 1940 Act
that there is a reasonable likelihood that the Plan will benefit
each fund and its shareholders. The Trustees recommend that
shareholders of each fund vote FOR approval of the Plan. If
approved by shareholders, the Plan will take effect on the first day of the
first month following approval. With respect to each fund, if
the Plan is not approved, the Board and FMR will consider alternative means
of obtaining the services that are to be provided under the Plan.
16. TO AMEND FIDELITY DIVERSIFIED INTERNATIONAL FUND'S, FIDELITY EUROPE
CAPITAL APPRECIATION FUND'S, FIDELITY INTERNATIONAL VALUE FUND'S, FIDELITY
JAPAN FUND'S, FIDELITY LATIN AMERICA FUND'S, AND FIDELITY SOUTHEAST ASIA
FUND'S FUNDAMENTAL INVESTMENT LIMITATION CONCERNING DIVERSIFICATION .
Fidelity Europe Capital Appreciation Fund's, Fidelity International Value
Fund's, Fidelity Latin America Fund's, and Fidelity Southeast Asia Fund's
current fundamental investment limitation concerning diversification is as
follows:
"The fund may not, with respect to 75% of the fund's total assets,
purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities) if, as a result, (a) more than 5% of the fund's total
assets would be invested in the securities of that issuer, or (b) the fund
would hold more than 10% of the outstanding voting securities of that
issuer."
Fidelity Diversified International Fund's and Fidelity Japan Fund's
current fundamental investment limitation concerning diversification is as
follows:
"The fund may not, with respect to 75% of the fund's total assets,
purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities) if, as a result thereof, (a) more than 5% of the fund's
total assets would be invested in the securities of that issuer, or (b) the
fund would hold more than 10% of the outstanding voting securities of that
issuer."
The Trustees recommend that shareholders of each fund vote to replace each
fund's current fundamental investment limitation with the following amended
fundamental investment limitation governing diversification (material to be
added is underlined, and material to be deleted for Diversified
International and Japan is [bracketed]):
"The fund may not, with respect to 75% of the fund's total assets,
purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities or securities of other investment companies) if, as a
result [thereof], (a) more than 5% of the fund's total assets would be
invested in the securities of that issuer, or (b) the fund would hold more
than 10% of the outstanding voting securities of that issuer."
The text recommended would make one change to each fund's diversification
limitation. Addition of the text would permit the funds to invest without
limitation in the securities of other investment companies. Pursuant to an
exemptive order granted by the SEC, each fund may invest up to 25% of total
assets in non-publicly offered money market or short-term bond funds (the
Central Funds) managed by FMR or an affiliate of FMR. The Central Funds do
not currently pay investment advisory, management, or transfer agent fees,
but do pay minimal fees for services, such as custodian, auditor, and
Independent Trustee fees. FMR anticipates that the Central Funds will
benefit each fund by enhancing the efficiency of cash management for the
Fidelity funds and by providing increased short-term investment
opportunities. If the proposal is approved, the Central Funds are expected
to serve as a principal option for cash investment for each fund.
If this proposal is approved, the amended fundamental diversification
limitation cannot be changed without the approval of shareholders.
CONCLUSION. The Board of Trustees has concluded that the proposed
amendment will benefit each fund and its shareholders. The Trustees
recommend voting FOR the proposal. The amended fundamental
diversification limitation, upon shareholder approval, w ill become
effective when the disclosure is revised to reflect the changes. If
th e proposal is not a pproved by the shareholders of a fund ,
that fund's current fundamental diversificat ion
limit ation 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,
net assets, and total expenses of funds with investment objectives similar
to Fidelity Diversified International Fund, Fidelity Europe Capital
Appreciation Fund, Fidelity France Fund, Fidelity Germany Fund, Fidelity
Hong Kong and China Fund, Fidelity International Value Fund, Fidelity Japan
Fund, Fidelity Japan Small Companies Fund, Fidelity Latin America Fund,
Fidelity Nordic Fund, Fidelity Southeast Asia Fund, and Fidelity United
Kingdom Fund and advised by FMR is contained in the Table of Average Net
Assets and Expense Ratios in Exhibit 1 0 beginning on page .
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;
Robert C. Pozen, President; and Peter S. Lynch, Vice Chairman. With the
exception of Robert C. Pozen , who is proposed for election as a
Trustee , each of the Directors is also a Trustee of the trust.
Edward C. Johnson 3d, J. Gary Burkhead, John H. Costello,
Arthur S. Loring, Robert H. Morrison , Robert C. Pozen (effective August
1, 1997) , Richard A. Silver, Leonard M. Rush, William J. Hayes, Greg
Fraser, Kevin McCarey, Richard Mace, Jr., Shigeki Makino, Patricia
Satterthwaite and Allan Liu are currently officers of the trust and
officers or employees of FMR or FMR Corp. With the exception of Mr.
Costello, Mr. Silver and Mr. Liu , 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 November 1, 1995 through May 31, 1997, no
transactions were entered into by Trustees and nominees as Trustee 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 Diversified
International Fund , Fidelity Europe Capital Appreciation Fund, Fidelity
France Fund, Fidelity Germany Fund, Fidelity Hong Kong and China Fund,
Fidelity International Value Fund, Fidelity Japan Fund, Fidelity Japan
Small Companies Fund, Fidelity Latin America Fund, Fidelity Nordic fund,
Fidelity Southeast Asia Fund, and Fidelity United Kingdom 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 1 0 beginning on page .
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 FMR Texas Inc. (FMR Texas); Chairman, Chief
Executive Officer, President, and a Director of FMR Corp., Chairman of the
Board and of the Executive Committee of FMR, and a Director of FMR. In
addition, Mr. Pozen is Senior Vice President (effective August 1,
1997) and is proposed for election as a Trustee of the
trust ; Director of FMR; and President and Director of FMR Texas.
Mr. Pozen has been appointed as a Trustee of certain other funds advised
by FMR, effective August 1, 1997. Each of the Directors is a
stockholder of FMR Corp. The principal business address of the Directors is
82 Devonshire Street, Boston, Massachusetts 02109.
ACTIVITIES AND MANAGEMENT OF FIJ, FIIA, AND FIIAL U.K.
FMR, on behalf of each fund, has entered into a sub-advisory agreement
with FIIA. FMR, on behalf of Fidelity Japan Fund, Fidelity Japan Small
Companies Fund, Fidelity Hong Kong and China Fund, Fidelity International
Value Fund and Fidelity Southeast Asia Fund has entered into a sub-advisory
agreement with FIJ. Both FIIA and FIJ are wholly owned subsidiaries of
Fidelity International Limited (FIL). FIIA in turn has entered into a
sub-advisory agreement with its U.K. subsidiary, FIIAL U.K.
The sub-advisers provide research and investment recommendations with
respect to companies based outside of the United States. FIJ focuses on
companies primarily based in Japan and other parts of Asia. FIIA focuses
primarily on companies based in Hong Kong, Australia, New Zealand, and
Southeast Asia (other than Japan). FIIAL U.K. focuses primarily on
companies based in the U.K. and Europe. Open-end funds with investment
objectives similar to Fidelity Diversified International Fund managed by
FMR with respect to which FMR currently has sub-advisory agreements, and
the net assets of each of these funds, are indicated in the Table of
Average Net Assets and Expense Ratios in Exhibit 1 0 beginning on
page .
The Directors of FIJ are Bill y Wilder, President, Edward C. Johnson
3d, Nobuhide Kamiyama, Noboru Kawai, Yasuo Kuramoto, Simon Haslam,
Lawrence Repeta, Simon Fraser and Hiroshi Yamashita. With the exception
of Mr. Edward C. Johnson 3d, the principal business address of each of the
Directors is Shiroyama JT Mori B ldg. , 4-3-1 Toranomon, Minato-ku,
Tokyo 105, Japan. The principal business address of Mr. Edward C. Johnson
3d is 82 Devonshire Street, Boston, Massachusetts 02109.
The Directors of FIIA are David J. Saul, President, Anthony J.
Bolton, Charles T. Collis, William R. Ebsworth, Brett P. Goodin,
K.C. Lee, Peter Phillips and Simon Haslam. The principal business
address of each of the Directors is Pembroke Hall, 42 Crow Lane, Pembroke
HM19, Bermuda.
The Directors of FIIAL U.K. are Anthony J. Bolton, Pamela Edwards,
Simon Haslam, and Sally Walden. The principal business address of each of
the Directors is 26 Lovat Lane, London, England EC3R 8LL.
FIIA also is the investment adviser of Fidelity Advisor Emerging Asia
Fund, Inc. and Fidelity Advisor Korea Fund, Inc., closed-end investment
companies with net assets of approximately $128,181,0 00 and
$53,808, 000 , as of May 31, 1997. As compensation for its services to
each closed-end fund, FIIA receives 60% of the management fee paid by that
fund to FMR. The Emerging Asia Fund management fee has two components, a
basic fee and a performance adjustment. The basic fee is payable monthly at
an annual rate equal to 1.00% of the Emerging Asia Fund's average daily net
assets. The performance adjustment may increase or decrease the basic fee
by up to 0.25% annually, based on the Emerging Asia Fund's performance
(over a rolling performance period of up to 36 months) as compared to
the Morgan Stanley Capital International All Country Asia ex-Japan Free
Index. The Korea Fund management fee is payable monthly at an annual
rate equal to 1.00% of Korea Fund's average daily net assets. At FIIA's
request, FIJ may provide sub-advisory services with respect to either
fund's investments. As compensation for these services, FIJ would receive
50% of the fee paid to FIIA by that fund in respect of the assets of the
fund managed by FIJ on a discretionary basis and 30% of the fee paid to
FIIA in respect of the assets of that fund managed by FIJ on a
non-discretionary basis.
PRESENT MANAGEMENT CONTRACT S
Each fund employs FMR to furnish investment advisory and other services.
Under its management contract with each fund, FMR acts as investment
adviser and, subject to the supervision of the Board of Trustees, directs
the investments of each fund in accordance with its investment objective,
policies, and limitations. FMR also provides each fund with all necessary
office facilities and personnel for servicing each fund's investments,
compensates all officers of each fund and all Trustees who are "interested
persons" of the trust or of FMR, and all personnel of each fund or FMR
performing services relating to research, statistical, and investment
activities.
In addition, FMR or its affiliates, subject to the supervision of the
Board of Trustees, provides the management and administrative services
necessary for the operation of each fund. These services include providing
facilities for maintaining each fund's organization; supervising relations
with custodians, transfer and pricing agents, accountants, underwriters,
and other persons dealing with each fund; preparing all general shareholder
communications and conducting shareholder relations; maintaining each
fund's records and the registration of each fund's shares under federal and
state laws; developing management and shareholder services for each fund;
and furnishing reports, evaluations, and analyses on a variety of subjects
to the Trustees. Services provided by affiliates of FMR will continue under
the proposed management contracts described in proposals 7 through 13.
In addition to the management fee payable to FMR, each fund pays transfer
agent and pricing and bookkeeping fees to Fidelity Service Company, Inc.
(FSC), an affiliate of FMR, its transfer, dividend disbursing, and
shareholder servicing agent. Although each fund's current management
contract provides that each fund will pay for typesetting, printing, and
mailing prospectuses, statements of additional information, notices, and
reports to shareholders, the trust, on behalf of each fund has entered into
a revised transfer agent agreement with FSC, pursuant to which FSC bears
the costs of providing these services to existing shareholders. Other
expenses paid by each fund include interest, taxes, brokerage commissions,
and each fund's proportionate share of insurance premiums and Investment
Company Institute dues. Each fund is also liable for such non-recurring
expenses as may arise, including costs of any litigation to which each fund
may be a party, and any obligation it may have to indemnify its officers
and Trustees with respect to litigation.
Transfer agent fees and pricing and bookkeeping fees, including
reimbursement for out-of-pocket expenses, paid to FSC by Fidelity
Diversified International Fund, Fidelity Europe Capital Appreciation Fund,
Fidelity France Fund, Fidelity Germany Fund, Fidelity Hong Kong and China
Fund, Fidelity International Value Fund, Fidelity Japan Fund, Fidelity
Japan Small Companies Fund, Fidelity Latin America Fund, Fidelity Nordic
Fund, Fidelity Southeast Asia Fund, and Fidelity United Kingdom Fund for
fiscal year ended October 31, 1996 are presented in the table below.
Fund Transfer Agent Pricing and
Fees Bookkeeping
Fees
Diversified International $ 1,305,020 $ 339,831
Europe Capital Appreciation $ 541,493 $ 122,201
France $ 17,581 $ 57,381
Germany $ 19,261 $ 57,381
Hong Kong and China $ 198,170 $ 57,751
International Value $ 581,960 $ 163,645
Japan $ 1,143,761 $ 273,877
Japan Small Companies $ 319,420 $ 82,444
Latin America $ 2,039,211 $ 402,734
Nordic $ 31,192 $ 57,387
Southeast Asia $ 2,405,622 $ 510,752
United Kingdom $ 5,997 $ 57,374
Each 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. Each 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 revenue paid to, and
retained by, FDC for fiscal 1996 amounted to $90,306 (Fidelity Europe
Capital Appreciation), $29,370 (Fidelity France Fund), $53,774 (Fidelity
Germany Fund), $575,460 ( Fidelity Hong Kong and China Fund), $821,892
(Fidelity Japan Fund), $694,227 (Fidelity Japan Small Companies Fund),
$968,514 (Fidelity Latin America Fund), $71,880 (Fidelity Nordic Fund),
$1,880,183 (Fidelity Southeast Asia Fund), and $13,869 (Fidelity United
Kingdom Fund), respectively.
FMR is each fund's manager pursuant to management contracts dated July 16,
1992, which was approved by FMR, then sole shareholder of the fund on
September 10, 1992 (Japan Fund), October 1, 1992, which was approved by
shareholders on September 16, 1992 (Diversified International Fund), March
18, 1993, which was approved by FMR, then sole shareholder, on March 23,
1993 (Southeast Asia and Latin America Funds ), November 18, 1993, which
was approved by FMR, then sole shareholder, on November 22, 1993 (Europe
Capital Appreciation Fund), September 16, 1994, which was approved by FMR,
then sole shareholder, on September 23, 1994 (International Value Fund),
November 1, 1995, which was approved by FMR, then sole shareholder
of the fund on October 17, 1995 (France, Germany, Hong Kong and China,
Japan Small Companies, Nordic, and United Kingdom Funds). The management
contracts approved by FMR as the then sole shareholder are the original
management contracts for those funds. The management contracts approved by
public shareholders were submitted to shareholders in connection with a
proposal to provide for lower fees when FMR's assets under management
exceed certain levels.
For the services of FMR under the contract, Fidelity France Fund, Fidelity
Germany Fund, Fidelity Hong Kong and China Fund, Fidelity Japan Small
Companies Fund, Fidelity Latin America Fund, Fidelity Nordic Fund ,
and Fidelity United Kingdom Fund each pay FMR a monthly management fee
composed of the sum of two elements: a group fee rate and an individual
fund fee rate.
For the services of FMR under the contract, Fidelity Diversified
International Fund, Fidelity Europe Capital Appreciation Fund, Fidelity
International Value Fund, Fidelity Japan Fund , and Fidelity
Southeast Asia Fund each pay FMR a monthly management fee composed of the
sum of two elements: a basic fee and a performance adjustment based on a
comparison of each fund's performance to that of the Morgan Stanley Capital
International Europe, Australasia, Far East Index (EAFA Index), Morgan
Stanley Capital International Europe Index (MSCI Europe Index), Morgan
Stanley Capital International Europe, Australasia, Far East Index (EAFA
Index), Tokyo Stock Exchange Index (TOPIX Index) and Morgan Stanley Capital
International Combined Far East ex-Japan Free Index (MSCI Far East ex-Japan
Free Index), respectively.
COMPUTING THE BASIC FEE AND MANAGEMENT FEE. Fidelity Diversified
International Fund's, Fidelity Europe Capital Appreciation Fund's, Fidelity
International Value Fund's, Fidelity Japan Fund's, and Fidelity Southeast
Asia Fund's basic fee rate and Fidelity France Fund's, Fidelity Germany
Fund's, Fidelity Hong Kong and China Fund's, Fidelity Japan Small Companies
Fund's, Fidelity Latin America Fund's, Fidelity Nordic Fund's, and Fidelity
United Kingdom Fund's management fee rate are composed of two elements:
a group fee rate and an individual fund fee rate.
The group fee rate is based on the monthly average net assets of all of
the registered investment companies with which FMR has management contracts
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 $435 billion of group net
assets - the approximate level for October 1996 - was
0.3037%, which is the weighted average of the respective fee rates for each
level of group net assets up to $435 billion.
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Average Group Annualized Group Net Effective Annual
Assets Rate Assets 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 1 25 .3430
18 - 21 .3700 150 .3371
21 - 24 .3600 175 .3325
24 - 30 .3500 200 .3284
30 - 36 .3450 2 25 .3253
36 - 42 .3400 250 .3223
42 - 48 .3350 275 .3198
48 - 66 .3250 300 .3175
66 - 84 .3200 325 .3153
84 - 102 .3150 350 .3133
102 - 138 .3100
138 - 174 .3050
174 - 228 .3000
228 - 282 .2950
282 - 336 .2900
Over 336 .2850
</TABLE>
Under Fidelity Diversified International Fund's, Fidelity
International Value Fund's, Fidelity Japan Fund's, Fidelity Latin America
Fund's, and Fidelity Southeast Asia Fund's current management contract with
FMR, the group fee rate is based on a schedule with breakpoints ending at
.3000% for average group assets in excess of $174 billion. For Fidelity
Diversified International Fund and Fidelity International Value Fund, prior
to March 1, 1992, the group fee rate breakpoints shown above for average
group assets in excess of $138 billion and under $228 billion were
voluntarily adopted by FMR on January 1, 1992. The additional breakpoints
shown above for average group assets in excess of $228 billion were
voluntarily adopted by FMR on November 1, 1993. Fidelity Europe Capital
Appreciation Fund's current management contract reflects the above table.
On August 1, 1994, FMR voluntarily revised the prior extensions to the
group fee rate schedule, and added new breakpoints for average group assets
in excess of $210 billion and under $390 billion as shown in the schedule
below. The revised group fee rate schedule (except for Fidelity
International Value Fund) was identical to the above schedule for average
group assets under $210 billion. Fidelity International Value's current
management contract reflects these extensions of the group fee rate
schedule. Fidelity France Fund's, Fidelity Germany Fund's, Fidelity Hong
Kong and China Fund's, Fidelity Japan Small Company Fund's, Fidelity Nordic
Fund's, and Fidelity United Kingdom Fund's current management contract
reflects the group fee rate schedule above for average group assets under
$210 billion and the group fee rate schedule below for average group assets
in excess of $210 billion and under $390 billion.
On January 1, 1996, FMR voluntarily added new breakpoints to the revised
schedule for average group assets in excess of $390 billion, pending
shareholder approval of a new management contract reflecting the revised
schedule and additional breakpoints. The revised group fee rate schedule
and its extensions provide for lower management fee rates as FMR's assets
under management increase. The revised group fee rate schedule for average
group assets in excess of $210 billion and up to $390 billion with
additional breakpoints voluntarily adopted by FMR for average group assets
in excess of $390 billion is as follows:
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Average Group Annualized Group Net Effective Annual
Assets Rate Assets Fee Rate
174 - $210 billion .3000% $ 150 billion .3371%
210 - 246 .2950 175 .3325
246 - 282 .2900 200 .3284
282 - 318 .2850 225 .3249
318 - 354 .2800 250 .3219
354 - 390 .2750 275 .3190
390 - 426 .2700 300 .3163
426 - 462 .2650 325 .3137
462 - 498 .2600 350 .3113
498 - 534 .2550 375 .3090
Over 534 .2500 400 .3067
425 .3046
450 .3024
475 .3003
500 .2982
525 .2962
550 .2942
</TABLE>
The individual fund fee rate is 0.45%. Based on the average group net
assets of the funds advised by FMR for October 31,1996, the annual
management fee/basic fee rate would be calculated as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Fund Group Fee Individual Fund Management/
Rate Fee Rate Basic Fee
Rate
FIDELITY DIVERSIFIED INTERNATIONAL
FUND 0.3037% + 0.45% = 0.7537%
FIDELITY EUROPE CAPITAL APPRECIATION
FUND 0.3037% + 0.45% = 0.7537%
FIDELITY FRANCE FUND 0.3037% + 0.45% = 0.7537%
FIDELITY GERMANY FUND 0.3037% + 0.45% = 0.7537%
FIDELITY HONG KONG AND CHINA FUND 0.3037% + 0.45% = 0.7537%
FIDELITY INTERNATIONAL VALUE FUND 0.3037% + 0.45% = 0.7537%
FIDELITY JAPAN FUND 0.3037% + 0.45% = 0.7537%
FIDELITY JAPAN SMALL COMPANIES
FUND 0.3037% + 0.45% = 0.7537%
FIDELITY LATIN AMERICA FUND 0.3037% + 0.45% = 0.7537%
FIDELITY NORDIC FUND 0.3037% + 0.45% = 0.7537%
FIDELITY SOUTHEAST ASIA FUND 0.3037% + 0.45% = 0.7537%
FIDELITY UNITED KINGDOM FUND 0.3037% + 0.45% = 0.7537%
</TABLE>
One-twelfth of this annual basic fee or management fee rate is applied to
each fund's net assets averaged for the month, giving a dollar amount,
which is the fee for that month.
COMPUTING THE PERFORMANCE ADJUSTMENT. The basic fee is subject to upward
or downward adjustment, depending upon whether, and to what extent,
Fidelity Diversified International Fund's, Fidelity Europe Capital
Appreciation Fund's, Fidelity International Value Fund's, Fidelity Japan
Fund's, and Fidelity Southeast Asia Fund's investment performance for the
performance period exceeds, or is exceeded by, the record of the Morgan
Stanley Capital International Europe, Australasia, Far East Index (EAFA
Index), Morgan Stanley Capital International Europe Index (MSCI Europe
Index), Morgan Stanley Capital International Europe, Australasia, Far East
Index (EAFA Index), Tokyo Stock Exchange Index (TOPIX Index), and Morgan
Stanley Capital International Combined Far East ex-Japan Free Index (MSCI
Far East ex-Japan Free Index),respectively, (the Index) over the same
period. Starting with the twelfth month, the performance adjustment takes
effect. Each month subsequent to the twelfth month, a new month is added to
the performance period until the performance period equals 36 months.
Thereafter, the performance period consists of the current month plus the
previous 35 months. Each percentage point of difference, calculated to the
nearest 1.0% (up to a maximum difference of +/-10.00 ) is multiplied by a
performance adjustment rate of .02%. Thus, the maximum annualized
adjustment rate is +/-.20%. This performance comparison is made at the end
of each month. One twelfth (1/12) of this rate is then applied to each
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.
Each fund's performance is calculated based on change in net asset value.
For purposes of calculating the performance adjustment, any dividends or
capital gain distributions paid by each fund are treated as if reinvested
in fund shares at the net asset value 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 Fidelity Diversified
International Fund's, Fidelity Europe Capital Appreciation Fund's, Fidelity
International Value Fund's, Fidelity Japan Fund's and Fidelity Southeast
Asia Fund's performance compared to the investment record of the Index, the
controlling factor is not whether these funds' performance is up or down
per se, but whether it is up or down more or less than the record of the
Index. Moreover, the comparative investment performance of these fund's is
based solely on the relevant performance period without regard to the
cumulative performance over a longer or shorter period of time.
During fiscal 1996, FMR received $ 0 , $ 0 , $439,689, $789,872,
$4,580,255, $ 0 , and $ 0 for its services as investment adviser
to Fidelity France Fund, Fidelity Germany Fund, Fidelity Hong Kong and
China Fund, Fidelity Japan Small Companies Fund, Fidelity Latin America
Fund, Fidelity Nordic Fund, and Fidelity United Kingdom Fund, respectively.
These fees were equivalent to 0. 00 %,0. 00 %,0.75%,0.75%,0.75%,
0. 00 %, and 0. 00 %, respectively, of the average net assets of
these funds.
During fiscal 1996, FMR received $4,050,659, $1,338,990, $1,722,862,
$2,553,329 and $5,541,725, respectively, for its services as investment
adviser to Fidelity Diversified International Fund, Fidelity Europe Capital
Appreciation Fund, Fidelity International Value Fund, Fidelity Japan Fund,
and Fidelity Southeast Asia Fund. These fees, which include both the basic
fee and the performance adjustment, were equivalent to 0.85%, 0.80%, 0.79%,
0.68%, and 0.65%, respectively, of the average net assets of these funds.
For fiscal 1996, the downward performance adjustments amounted to
($283,515) and ($882,709), respectively, for Fidelity Japan Fund and
Fidelity Southeast Asia Fund. For fiscal 1996, the upward performance
adjustments amounted to $445,161, $67,995, and $86,631, respectively, for
Fidelity Diversified International Fund, Fidelity Europe Capital
Appreciation Fund, and Fidelity International Value Fund.
FMR may, from time to time, voluntarily reimburse all or a portion of each
fund's operating expenses (exclusive of interest, taxes, brokerage
commissions, and extraordinary expenses). FMR retains the ability to be
repaid for these expense reimbursements in the amount that expenses fall
below the limit prior to the end of the fiscal year. Expense reimbursements
by FMR will increase each fund's total returns and repayment of the
reimbursement by each fund will lower its total returns.
During fiscal 1996, FMR voluntarily agreed, subject to revision or
termination, to reimburse Fidelity France Fund, Fidelity Germany Fund,
Fidelity Nordic Fund , and Fidelity United Kingdom Fund to the extent
that their aggregate operating expenses, including management fees, were in
excess of an annual rate of 2.00% of average net assets of each respective
fund. If this reimbursement had not been in effect, for fiscal 1996, FMR
would have received fees amounting to $ 41,011 , $ 41,319 ,
$71,158, and $15,497, respectively, which would have been equivalent to
0.75 %, 0.75 %, 0.75 %, and 0.75 %, respectively,
of average net assets of each fund (after reduction for compensation to the
non-interested Trustees).
SUB-ADVISORY AGREEMENTS
On behalf of each fund, FMR has entered into sub-advisory agreements with
FMR U.K., FMR Far East, and FIIA. On behalf of Fidelity Hong Kong and China
Fund, Fidelity International Value Fund, Fidelity Japan Fund, Fidelity
Japan Small Companies Fund, and Fidelity Southeast Asia Fund , FMR
has entered into sub-advisory agreements with FI J . FIIA, in turn,
has entered into a sub-advisory agreement with FIIAL U.K. Pursuant to the
sub-advisory agreements, FMR may receive investment advice and research
services outside the United States from the sub-advisers. On behalf of
Fidelity Southeast Asia Fund, Fidelity Hong Kong and China Fund, and
Fidelity Japan Fund, FMR may also grant FIIA investment management
authority as well as the authority to buy and sell securities if FMR
believes it would be beneficial to the funds. On behalf of Fidelity France
Fund, Fidelity Germany Fund, Fidelity Nordic Fund and Fidelity United
Kingdom Fund , FMR may also grant FIIAL U.K. investment management
authority as well as the authority to buy and sell securities if FMR
believes it would be beneficial to the funds. On behalf of Fidelity Japan
Small Companies Fund, FMR may also grant FIJ investment management
authority as well as the authority to buy and sell securities if FMR
believes it would be beneficial to the fund. FMR entered into the
sub-advisory agreements described above with respect to Fidelity Japan Fund
on July 16, 1992, which was approved by FMR, then the sole shareholder, on
September 10, 1992; with respect to Fidelity Latin America Fund and
Fidelity Southeast Asia Fund on March 18, 1993, which were approved by FMR,
then the sole shareholder on March 23, 1993; with respect to Fidelity
Europe Capital Appreciation Fund on November 18, 1993, which was approved
by FMR, then the sole shareholder on November 18, 1993; and with respect to
Fidelity France Fund, Fidelity Germany Fund, Fidelity Hong Kong and China
Fund, Fidelity Japan Small Companies Fund, Fidelity Nordic Fund, and
Fidelity United Kingdom Fund on September 14, 1995, which were approved by
FMR as the then sole shareholder of each fund on October 17, 1995.
Currently, FMR U.K., FMR Far East FIJ, FIIA, and FIIAL U.K. 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. FIJ and FIIA are wholly owned subsidiaries of Fidelity
International Limited (FIL), a Bermuda company formed in 1968 which
primarily provides investment advisory services to non-U.S. investment
companies and institutional investors investing in securities throughout
the world. Edward C. Johnson 3d, Johnson family members, and various trusts
for the benefit of the Johnson family owns, directly or indirectly, more
than 25% of the voting common stock of FIL. FIJ was organized in Japan in
1986. FIIA was organized in Bermuda in 1983. FIIAL U.K. was organized in
the United Kingdom in 1984, and is a wholly owned subsidiary of Fidelity
International Management Holdings Limited, an indirect wholly owned
subsidiary of FIL.
Under the sub-advisory agreements, FMR pays the fees of FMR U.K., FMR Far
East, FIJ, and FIIA. FIIA, in turn, pays the fees of FIIAL U.K. For
providing non-discretionary investment advice and research services the
sub-advisers are compensated as follows:
(medium solid bullet) FMR pays FMR U.K. and FMR Far East fees equal to
110% and 105%, respectively, of FMR U.K.'s and FMR Far East's costs
incurred in connection with providing investment advice and research
services.
(medium solid bullet) FMR pays FIIA and FIJ fees equal to 30% of FMR's
monthly management fee with respect to the average net assets held by the
fund for which the sub-adviser has provided FMR with investment advice and
research services.
(medium solid bullet) FIIA pays FIIAL U.K. a fee equal to 110% of FIIAL
U.K.'s costs incurred in connection with providing investment advice and
research services.
On behalf of Fidelity Southeast Asia Fund, Fidelity Hong Kong and China
Fund, Fidelity Japan Fund, Fidelity France Fund, Fidelity Germany Fund,
Fidelity Nordic Fund, Fidelity United Kingdom Fund, and Fidelity Japan
Small Companies Fund, for providing discretionary investment management and
executing portfolio transactions, the sub-advisers are compensated as
follows:
(medium solid bullet) FMR pays FMR U.K., FMR Far East, FIJ, and FIIA a fee
equal to 50% of its monthly management fee (including any performance
adjustment) with respect to the fund's average net assets managed by the
sub-adviser on a discretionary basis.
(medium solid bullet) FIIA pays FIIAL U.K. a fee equal to 110% of FIIAL
U.K.'s costs incurred in connection with providing discretionary investment
management services.
For providing investment advice and research services on behalf of the
funds, the fees paid to the sub-advisers for the fiscal year ended 1996
are listed below. No fees were paid to FIIA, FIIAL U.K. and FIJ for
providing investment advice and research services on behalf of the
funds.
FMR U.K. FMR Far East
Fidelity Diversified International Fund $ 261,591 $ 263,574
Fidelity Europe Capital Appreciation Fund 108,871 0
Fidelity International Value Fund 132,491 130,310
For providing discretionary investment management and executing portfolio
transactions on behalf of the funds, the fees paid to FIIA, FIIAL U.K. and
FIJ for fiscal 1996 are listed below. No fees were paid to FMR U.K. and
FMR Far East for providing discretionary investment management and
execution of portfolio transactions on behalf of the funds.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
FIIA FIIAL U.K. FIJ
Fidelity Diversified International Fund $ 0 $ 0 $ 0
Fidelity Europe Capital Appreciation Fund 0 0 0
Fidelity France Fund 20,506 9,746 0
Fidelity Germany Fund 20,660 9,580 0
Fidelity Hong Kong and China Fund 219,845 0 0
Fidelity International Value Fund 0 0 0
Fidelity Japan Fund 675,784 0 596,553
Fidelity Japan Small Companies Fund 278,610 144,816 80,585
Fidelity Latin America Fund 0 0 0
Fidelity Nordic Fund 35,579 14,299 0
Fidelity Southeast Asia Fund 2,773,021 0 0
Fidelity United Kingdom Fund 7,749 3,597 0
</TABLE>
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are placed on
behalf of each fund by FMR pursuant to authority contained in the fund's
management contract.
FMR may place agency transactions with National Financial Services
Corporation (NFSC) and Fidelity Brokerage Services (FBS), 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.
The brokerage commissions paid to NFSC and FBS by each fund for the fiscal
year ended October 31, 1996 are listed in the following table:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
To To % To % To
NFSC FBS NFSC FBS
Fidelity Diversified International Fund $ 7 5 , 564 $ 80,532 3. 45 % 3.67%
Fidelity Europe Capital Appreciation Fund 0 19,477 0.00 1.79
Fidelity France Fund 0 1,234 0.00 2.85
Fidelity Germany Fund 0 8,857 0.00 27.39
Fidelity Hong Kong and China Fund 0 0 0.00 0.00
Fidelity International Value Fund 7, 878 45,758 0.8 5 4.93
Fidelity Japan Fund 0 0 0.00 0.00
Fidelity Japan Small Companies Fund 0 0 0.00 0.00
Fidelity Latin America Fund 29,528 0 1.38 0.00
Fidelity Nordic Fund 0 3,427 0.00 4.19
Fidelity Southeast Asia Fund 0 0 0.00 0.00
Fidelity United Kingdom Fund 0 124 0.00 2.34
</TABLE>
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 Fidelity Service Company, Inc.,
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 DISCLOSURE WILL BE ADDED;
[BRACKETED] DISCLOSURE WILL BE DELETED.
FORM OF
MANAGEMENT CONTRACT
BETWEEN
FIDELITY INVESTMENT TRUST:
FIDELITY DIVERSIFIED INTERNATIONAL FUND
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
((AGREEMENT AMENDED and RESTATED as of)) [Amended] this [1st] ___ day of
[October 1992] ((_____ 1997, ))by and between Fidelity Investment Trust, a
Massachusetts business trust which may issue one or more series of shares
of beneficial interest (hereinafter called the "Fund"), on behalf of
Fidelity Diversified International 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
December 24, 1991, to a modification of said Contract in the manner set
below. The Amended Management Contract shall, when executed by duly
authorized officers of the Fund and Adviser, take effect on the later of
((October 1, 1997)) or the first day of the month following approval.
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the supervision
of the Fund's Board of Trustees, direct the investments of the Portfolio in
accordance with the investment objective, policies and limitations as
provided in the Portfolio's Prospectus or other governing instruments, as
amended from time to time, the Investment Company Act of 1940 and rules
thereunder, as amended from time to time (the "1940 Act"), and such other
limitations as the Portfolio may impose by notice in writing to the
Adviser. The Adviser shall also furnish for the use of the Portfolio office
space and all necessary office facilities, equipment and personnel for
servicing the investments of the Portfolio; and shall pay the salaries and
fees of all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all personnel of
the Fund or the Adviser performing services relating to research,
statistical and investment activities. The Adviser is authorized, in its
discretion and without prior consultation with the Portfolio, to buy, sell,
lend and otherwise trade in any stocks, bonds and other securities and
investment instruments on behalf of the Portfolio. The investment policies
and all other actions of the Portfolio are and shall at all times be
subject to the control and direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for the
performance by its affiliates of) the management and administrative
services necessary for the operation of the Fund. The Adviser shall,
subject to the supervision of the Board of Trustees, perform various
services for the Portfolio, including but not limited to: (i) providing the
Portfolio with office space, equipment and facilities (which may be its
own) for maintaining its organization; (ii) on behalf of the Portfolio,
supervising relations with, and monitoring the performance of, custodians,
depositories, transfer and pricing agents, accountants, attorneys,
underwriters, brokers and dealers, insurers and other persons in any
capacity deemed to be necessary or desirable; (iii) preparing all general
shareholder communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered, maintaining
the registration and qualification of the Portfolio's shares under federal
and state law; and (vii) investigating the development of and developing
and implementing, if appropriate, management and shareholder services
designed to enhance the value or convenience of the Portfolio as an
investment vehicle.
The Adviser shall also furnish such reports, evaluations, information or
analyses to the Fund as the Fund's Board of Trustees may request from time
to time or as the Adviser may deem to be desirable. The Adviser shall make
recommendations to the Fund's Board of Trustees with respect to Fund
policies, and shall carry out such policies as are adopted by the Trustees.
The Adviser shall, subject to review by the Board of Trustees, furnish such
other services as the Adviser shall from time to time determine to be
necessary or useful to perform its obligations under this Contract.
(c) The Adviser [at its own expense,] shall place all orders for the
purchase and sale of portfolio securities for the Portfolio's account with
brokers or dealers selected by the Adviser, which may include brokers or
dealers affiliated with the Adviser. The Adviser shall use its best efforts
to seek to execute portfolio transactions at prices which are advantageous
to the Portfolio and at commission rates which are reasonable in relation
to the benefits received. In selecting brokers or dealers qualified to
execute a particular transaction, brokers or dealers may be selected who
also provide brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) to the Portfolio
and/or the other accounts over which the Adviser or its affiliates exercise
investment discretion. The Adviser is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess of
the amount of commission another broker or dealer would have charged for
effecting that transaction if the Adviser determines in good faith that
such amount of commission is reasonable in relation to the value of the
brokerage and research services provided by such broker or dealer. This
determination may be viewed in terms of either that particular transaction
or the overall responsibilities which the Adviser and its affiliates have
with respect to accounts over which they exercise investment discretion.
The Trustees of the Fund shall periodically review the commissions paid by
the Portfolio to determine if the commissions paid over representative
periods of time were reasonable in relation to the benefits to the
Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor. The
Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of the
Fund are or may be or become interested in the Adviser as directors,
officers or otherwise and that directors, officers and stockholders of the
Adviser are or may be or become similarly interested in the Fund, and that
the Adviser may be or become interested in the Fund as a shareholder or
otherwise.
3. The Adviser will be compensated on the following basis for the services
and facilities to be furnished hereunder. The Adviser shall receive a
monthly management fee, payable monthly as soon as practicable after the
last day of each month, composed of a [b]((B))asic [f]((F))ee and a
[p]((P))erformance [a]((A))djustment [to the basic fee based upon the
investment performance of the Portfolio in relation to the]. ((The
Performance Adjustment is added to or subtracted from the Basic Fee
depending on whether the Portfolio experienced better or worse performance
than the)) Morgan Stanley Capital International Europe,
Austral(( as)) ia, and Far East Index (((GDP-weighted))) (the
"Index"). ((The Performance Adjustment is not cumulative. An increased fee
will result even though the performance of the Portfolio over some period
of time shorter than the performance period has been behind that of the
Index, and, conversely, a reduction in the fee will be made for a month
even though the performance of the Portfolio over some period of time
shorter than the performance period has been ahead of that of the Index.))
The [b]((B))asic [f]((F))ee and the [p]((P))erformance [a]((A))djustment
will be computed as follows:
(a) Basic Fee Rate [.]: The annual [b]((B))asic [f]((F))ee [r]((R))ate
shall be the sum of the [g]((G))roup [f]((F))ee [r]((R))ate and the
[i]((I))ndividual [f]((F))und [f]((F))ee [r]((R))ate calculated to the
nearest millionth decimal place as follows:
(i) Group Fee Rate. The Group [f]((F))ee [r]((R))ate 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 [charter](( fund's
Declaration ))of ((Trust or ))[each] ((other ))[investment]
((organizational ))[company] ((document) ))determined as of the close of
business on each business day throughout the month. The Group [f]((F))ee
[r]((R))ate shall be determined on a cumulative basis pursuant to the
following schedule:
Average Net Assets Annualized Fee Rate (for each level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
[Over 174] [.3000]
((174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over - 534 .2500))
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be
.45%.
(b) ((Basic Fee.)) One-twelfth of the [annual fee rate] ((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 [b]((B))asic [f]((F))ee. [The basic fee will be subject to
upward or downward on the basis of the Portfolio's investment performance
as follows:]
[(c) The Performance Adjustment: An adjustment to the monthly basic fee
will be made by applying a performance adjustment rate to the average net
assets of the Portfolio over the performance period. The resulting dollar
figure will be added or subtracted from the basic fee depending on whether
the Portfolio experienced better or worse performance than the Index.]
(((c) Performance Adjustment Rate:)) The [p]((P))erformance
[a]((A))djustment [r]((R))ate is 0.02% for each percentage point [rounded
to the nearer point (the higher point if exactly one-half 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 performance adjustment rate is 0.20%.
The performance period will commence with the first day of the first full
month [of operation] following the Portfolio's commencement of operations.
During the first eleven months of the [operation of the contract]
((performance period for the Portfolio,)) there will be no performance
adjustment. Starting with the twelfth month of the performance period, the
performance adjustment will take effect. Following the twelfth month a new
month will be added to the performance period until the performance period
equals 36 months. Thereafter the performance period will consist of the
current month plus the previous 35 months.
The Portfolio's investment performance will be measured by comparing (i)
the opening net asset value of one share of the Portfolio on the first
business day of the performance period with (ii) the closing net asset
value of one share of the Portfolio as of the last business day of such
period. In computing the investment performance of the Portfolio and the
investment record of the Index, distributions of realized capital gains,
the value of capital gains taxes per share paid or payable on undistributed
realized long-term capital gains accumulated to the end of such period and
dividends paid out of investment income on the part of the Portfolio, and
all cash distributions of the [companies] ((securities)) [whose]
((included)) [stocks comprise] ((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.
[The computation of the performance adjustment will not be cumulative. A
positive fee rate will apply 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 negative fee rate will apply
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.]
(d) ((Performance Adjustment.)) One-twelfth of the annual
[p]((P))erformance [a]((A))djustment [r]((R))ate [shall] ((will)) be
applied to the average of the net assets of the Portfolio (computed in the
manner set forth in the ((Fund's)) Declaration of Trust [of the Fund
adjusted as provided in paragraph (e) below, if applicable] ((or other
organizational document))) determined as of the close of business on each
business day throughout the month and the performance period. [The
resulting dollar amount is added to or deducted from the basic fee.]
(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 [b]((B))asic
[f]((F))ee [r]((R))ate will be computed on the basis of and applied to net
assets averaged over that month ending on the last business day on which
this Contract is in effect. The amount of this [p] ((P))erformance [a]
((A))djustment to the [b]((B))asic [f]((F))ee 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, [other
than those expressly stated to be payable by the Adviser hereunder,] 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,
[1993] ((1998)) 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.
(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
UNDERLINED DISCLOSURE WILL BE ADDED;
[BRACKETED] DISCLOSURE WILL BE DELETED.
FORM OF
MANAGEMENT CONTRACT
BETWEEN
FIDELITY INVESTMENT TRUST:
FIDELITY INTERNATIONAL VALUE FUND
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
[AGREEMENT] ((AGREEMENT AMENDED and RESTATED as of)) [made] this[16] __
day [September 1994] of ____ 1997, by and between Fidelity Investment
Trust, a Massachusetts business trust which may issue one or more series of
shares of beneficial interest (hereinafter called the "Fund"), on behalf of
Fidelity International Value 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
September 16, 1994, to a modification of said Contract in the manner set
below. The Amended Management Contract shall, when executed by duly
authorized officers of the Fund and Adviser, take effect on October 1, 1997
or the first day of the month following approval.))
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the supervision
of the Fund's Board of Trustees, direct the investments of the Portfolio in
accordance with the investment objective, policies and limitations as
provided in the Portfolio's Prospectus or other governing instruments, as
amended from time to time, the Investment Company Act of 1940 and rules
thereunder, as amended from time to time (the "1940 Act"), and such other
limitations as the Portfolio may impose by notice in writing to the
Adviser. The Adviser shall also furnish for the use of the Portfolio office
space and all necessary office facilities, equipment and personnel for
servicing the investments of the Portfolio; and shall pay the salaries and
fees of all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all personnel of
the Fund or the Adviser performing services relating to research,
statistical and investment activities. The Adviser is authorized, in its
discretion and without prior consultation with the Portfolio, to buy, sell,
lend and otherwise trade in any stocks, bonds and other securities and
investment instruments on behalf of the Portfolio. The investment policies
and all other actions of the Portfolio are and shall at all times be
subject to the control and direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for the
performance by its affiliates of) the management and administrative
services necessary for the operation of the Fund. The Adviser shall,
subject to the supervision of the Board of Trustees, perform various
services for the Portfolio, including but not limited to: (i) providing the
Portfolio with office space, equipment and facilities (which may be its
own) for maintaining its organization; (ii) on behalf of the Portfolio,
supervising relations with, and monitoring the performance of, custodians,
depositories, transfer and pricing agents, accountants, attorneys,
underwriters, brokers and dealers, insurers and other persons in any
capacity deemed to be necessary or desirable; (iii) preparing all general
shareholder communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered, maintaining
the registration and qualification of the Portfolio's shares under federal
and state law; and (vii) investigating the development of and developing
and implementing, if appropriate, management and shareholder services
designed to enhance the value or convenience of the Portfolio as an
investment vehicle.
The Adviser shall also furnish such reports, evaluations, information or
analyses to the Fund as the Fund's Board of Trustees may request from time
to time or as the Adviser may deem to be desirable. The Adviser shall make
recommendations to the Fund's Board of Trustees with respect to Fund
policies, and shall carry out such policies as are adopted by the Trustees.
The Adviser shall, subject to review by the Board of Trustees, furnish such
other services as the Adviser shall from time to time determine to be
necessary or useful to perform its obligations under this Contract.
(c) The Adviser shall place all orders for the purchase and sale of
portfolio securities for the Portfolio's account with brokers or dealers
selected by the Adviser, which may include brokers or dealers affiliated
with the Adviser. The Adviser shall use its best efforts to seek to execute
portfolio transactions at prices which are advantageous to the Portfolio
and at commission rates which are reasonable in relation to the benefits
received. In selecting brokers or dealers qualified to execute a particular
transaction, brokers or dealers may be selected who also provide brokerage
and research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Portfolio and/or the other accounts
over which the Adviser or its affiliates exercise investment discretion.
The Adviser is authorized to pay a broker or dealer who provides such
brokerage and research services a commission for executing a portfolio
transaction for the Portfolio which is in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction if the Adviser determines in good faith that such amount of
commission is reasonable in relation to the value of the brokerage and
research services provided by such broker or dealer. This determination may
be viewed in terms of either that particular transaction or the overall
responsibilities which the Adviser and its affiliates have with respect to
accounts over which they exercise investment discretion. The Trustees of
the Fund shall periodically review the commissions paid by the Portfolio to
determine if the commissions paid over representative periods of time were
reasonable in relation to the benefits to the Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor. The
Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of the
Fund are or may be or become interested in the Adviser as directors,
officers or otherwise and that directors, officers and stockholders of the
Adviser are or may be or become similarly interested in the Fund, and that
the Adviser may be or become interested in the Fund as a shareholder or
otherwise.
3. The Adviser will be compensated on the following basis for the services
and facilities to be furnished hereunder. The Adviser shall receive a
monthly management fee, payable monthly as soon as practicable after the
last day of each month, composed of a Basic Fee and a Performance
Adjustment. The Performance Adjustment is added to or subtracted from the
Basic Fee depending on whether the Portfolio experienced better or worse
performance than the Morgan Stanley Capital International Europe,
Austral as ia, and Far East Index (the "Index"). The Performance
Adjustment is not cumulative. An increased fee will result even though the
performance of the Portfolio over some period of time shorter than the
performance period has been behind that of the Index, and, conversely, a
reduction in the fee will be made for a month even though the performance
of the Portfolio over some period of time shorter than the performance
period has been ahead of that of the Index. The Basic Fee and the
Performance Adjustment will be computed as follows:
(a) Basic Fee Rate: The annual Basic Fee Rate shall be the sum of the
Group Fee Rate and the Individual Fund Fee Rate calculated to the nearest
millionth decimal place as follows:
(i) Group Fee Rate. The Group Fee Rate shall be based upon the monthly
average of the net assets of the registered investment companies having
Advisory and Service or Management Contracts with the Adviser (computed in
the manner set forth in the fund's Declaration of Trust or other
organizational document) determined as of the close of business on each
business day throughout the month. The Group Fee Rate shall be determined
on a cumulative basis pursuant to the following schedule:
Average Net Assets Annualized Fee Rate (for each level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
[Over 390] - [.270]
((390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over - 534 .2500))
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be
.45%.
(b) Basic Fee. One-twelfth of the Basic Fee Rate shall be applied to the
average of the net assets of the Portfolio (computed in the manner set
forth in the Fund's Declaration of Trust or other organizational document)
determined as of the close of business on each business day throughout the
month. The resulting dollar amount comprises the Basic Fee.
(c) Performance Adjustment Rate: The Performance Adjustment Rate is 0.02%
for each percentage point (the performance of the Portfolio and the Index
each being calculated to the nearest [ percentage point ]
((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 performance adjustment rate is 0.20%.
The performance period will commence with the first day of the first full
month following the Portfolio's commencement of operations. During the
first eleven months of the performance period for the Portfolio, there will
be no performance adjustment. Starting with the twelfth month of the
performance period, the performance adjustment will take effect. Following
the twelfth month a new month will be added to the performance period until
the performance period equals 36 months. Thereafter the performance period
will consist of the current month plus the previous 35 months.
The Portfolio's investment performance will be measured by comparing (i)
the opening net asset value of one share of the Portfolio on the first
business day of the performance period with (ii) the closing net asset
value of one share of the Portfolio as of the last business day of such
period. In computing the investment performance of the Portfolio and the
investment record of the Index, distributions of realized capital gains,
the value of capital gains taxes per share paid or payable on undistributed
realized long-term capital gains accumulated to the end of such period and
dividends paid out of investment income on the part of the Portfolio, and
all cash distributions of the securities included in the Index, will be
treated as reinvested in accordance with Rule 205-1 or any other applicable
rules under the Investment Advisers Act of 1940, as the same from time to
time may be amended.
(d) Performance Adjustment. One-twelfth of the annual Performance
Adjustment Rate will be applied to the average of the net assets of the
Portfolio (computed in the manner set forth in the Fund's Declaration of
Trust or other organizational document) determined as of the close of
business on each business day throughout the month and the performance
period.
(e) In case of termination of this Contract during any month, the fee for
that month shall be reduced proportionately on the basis of the number of
business days during which it is in effect for that month. The Basic Fee
Rate will be computed on the basis of and applied to net assets averaged
over that month ending on the last business day on which this Contract is
in effect. The amount of this Performance Adjustment to the Basic Fee will
be computed on the basis of and applied to net assets averaged over the
36-month period ending on the last business day on which this Contract is
in effect provided that if this Contract has been in effect less than 36
months, the computation will be made on the basis of the period of time
during which it has been in effect.
4. It is understood that the Portfolio will pay all its expenses, which
expenses payable by the Portfolio shall include, without limitation, (i)
interest and taxes; (ii) brokerage commissions and other costs in
connection with the purchase or sale of securities and other investment
instruments; (iii) fees and expenses of the Fund's Trustees other than
those who are "interested persons" of the Fund or the Adviser; (iv) legal
and audit expenses; (v) custodian, registrar and transfer agent fees and
expenses; (vi) fees and expenses related to the registration and
qualification of the Fund and the Portfolio's shares for distribution under
state and federal securities laws; (vii) expenses of printing and mailing
reports and notices and proxy material to shareholders of the Portfolio;
(viii) all other expenses incidental to holding meetings of the Portfolio's
shareholders, including proxy solicitations therefor; (ix) a pro rata
share, based on relative net assets of the Portfolio and other registered
investment companies having Advisory and Service or Management Contracts
with the Adviser, of 50% of insurance premiums for fidelity and other
coverage; (x) its proportionate share of association membership dues; (xi)
expenses of typesetting for printing Prospectuses and Statements of
Additional Information and supplements thereto; (xii) expenses of printing
and mailing Prospectuses and Statements of Additional Information and
supplements thereto sent to existing shareholders; and (xiii) such
non-recurring or extraordinary expenses as may arise, including those
relating to actions, suits or proceedings to which the Portfolio is a party
and the legal obligation which the Portfolio may have to indemnify the
Fund's Trustees and officers with respect thereto.
5. The services of the Adviser to the Portfolio are not to be deemed
exclusive, the Adviser being free to render services to others and engage
in other activities, provided, however, that such other services and
activities do not, during the term of this Contract, interfere, in a
material manner, with the Adviser's ability to meet all of its obligations
with respect to rendering services to the Portfolio hereunder. In the
absence of willful misfeasance, bad faith, gross negligence or reckless
disregard of obligations or duties hereunder on the part of the Adviser,
the Adviser shall not be subject to liability to the Portfolio or to any
shareholder of the Portfolio for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that may be
sustained in the purchase, holding or sale of any security ((or other
investment instrument.))
6. (a) Subject to prior termination as provided in sub-paragraph (d) of
this paragraph 6, this Contract shall continue in force until July 31,
[1995] 1998 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.
(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 3
UNDERLINED DISCLOSURE WILL BE ADDED;
[BRACKETED] DISCLOSURE WILL BE DELETED.
FORM OF
MANAGEMENT CONTRACT
BETWEEN
FIDELITY INVESTMENT TRUST:
FIDELITY EUROPE CAPITAL APPRECIATION FUND
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
((AGREEMENT AMENDED and RESTATED as of)) [AGREEMENT made] this [18th]
((___)) day of [November 1993] ((_____ 1997, ))by ((and between ))Fidelity
Investment Trust, a Massachusetts business trust which may issue one or
more series of shares of beneficial interest (hereinafter called the
"Fund"), on behalf of Fidelity Europe Capital Appreciation 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
November 18, 1993, to a modification of said Contract in the manner set
below. The Amended Management Contract shall, when executed by duly
authorized officers of the Fund and Adviser, take effect on the later of
October 1, 1997 or the first day of the month following approval.))
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the supervision
of the Fund's Board of Trustees, direct the investments of the Portfolio in
accordance with the investment objective, policies and limitations as
provided in the Portfolio's Prospectus or other governing instruments, as
amended from time to time, the Investment Company Act of 1940 and rules
thereunder, as amended from time to time (the "1940 Act"), and such other
limitations as the Portfolio may impose by notice in writing to the
Adviser. The Adviser shall also furnish for the use of the Portfolio office
space and all necessary office facilities, equipment and personnel for
servicing the investments of the Portfolio; and shall pay the salaries and
fees of all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all personnel of
the Fund or the Adviser performing services relating to research,
statistical and investment activities. The Adviser is authorized, in its
discretion and without prior consultation with the Portfolio, to buy, sell,
lend and otherwise trade in any stocks, bonds and other securities and
investment instruments on behalf of the Portfolio. The investment policies
and all other actions of the Portfolio are and shall at all times be
subject to the control and direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for the
performance by its affiliates of) the management and administrative
services necessary for the operation of the Fund. The Adviser shall,
subject to the supervision of the Board of Trustees, perform various
services for the Portfolio, including but not limited to: (i) providing the
Portfolio with office space, equipment and facilities (which may be its
own) for maintaining its organization; (ii) on behalf of the Portfolio,
supervising relations with, and monitoring the performance of, custodians,
depositories, transfer and pricing agents, accountants, attorneys,
underwriters, brokers and dealers, insurers and other persons in any
capacity deemed to be necessary or desirable; (iii) preparing all general
shareholder communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered, maintaining
the registration and qualification of the Portfolio's shares under federal
and state law; and (vii) investigating the development of and developing
and implementing, if appropriate, management and shareholder services
designed to enhance the value or convenience of the Portfolio as an
investment vehicle.
The Adviser shall also furnish such reports, evaluations, information or
analyses to the Fund as the Fund's Board of Trustees may request from time
to time or as the Adviser may deem to be desirable. The Adviser shall make
recommendations to the Fund's Board of Trustees with respect to Fund
policies, and shall carry out such policies as are adopted by the Trustees.
The Adviser shall, subject to review by the Board of Trustees, furnish such
other services as the Adviser shall from time to time determine to be
necessary or useful to perform its obligations under this Contract.
(c) The Adviser [at its own expense,] shall place all orders for the
purchase and sale of portfolio securities for the Portfolio's account with
brokers or dealers selected by the Adviser, which may include brokers or
dealers affiliated with the Adviser. The Adviser shall use its best efforts
to seek to execute portfolio transactions at prices which are advantageous
to the Portfolio and at commission rates which are reasonable in relation
to the benefits received. In selecting brokers or dealers qualified to
execute a particular transaction, brokers or dealers may be selected who
also provide brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) to the Portfolio
and/or the other accounts over which the Adviser or its affiliates exercise
investment discretion. The Adviser is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess of
the amount of commission another broker or dealer would have charged for
effecting that transaction if the Adviser determines in good faith that
such amount of commission is reasonable in relation to the value of the
brokerage and research services provided by such broker or dealer. This
determination may be viewed in terms of either that particular transaction
or the overall responsibilities which the Adviser and its affiliates have
with respect to accounts over which they exercise investment discretion.
The Trustees of the Fund shall periodically review the commissions paid by
the Portfolio to determine if the commissions paid over representative
periods of time were reasonable in relation to the benefits to the
Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor. The
Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of the
Fund are or may be or become interested in the Adviser as directors,
officers or otherwise and that directors, officers and stockholders of the
Adviser are or may be or become similarly interested in the Fund, and that
the Adviser may be or become interested in the Fund as a shareholder or
otherwise.
3. The Adviser will be compensated on the following basis for the services
and facilities to be furnished hereunder. The Adviser shall receive a
monthly management fee, payable monthly as soon as practicable after the
last day of each month, composed of a [b]((B))asic [f]((F))ee and a
[p]((P))erformance [a]((A))djustment. [to the basic fee based upon the
investment performance of the Portfolio in relation to the]. ((The
Performance Adjustment is added to or subtracted from the Basic Fee
depending on whether the Portfolio experienced better or worse performance
than the)) Morgan Stanley Capital International Europe Index (the "Index").
((The Performance Adjustment is not cumulative. An increased fee will
result even though the performance of the Portfolio over some period of
time shorter than the performance period has been behind that of the Index,
and, conversely, a reduction in the fee will be made for a month even
though the performance of the Portfolio over some period of time shorter
than the performance period has been ahead of that of the Index.)) The
[b]((B))asic [f]((F))ee and the [p]((P))erformance [a]((A))djustment will
be computed as follows:
(a) Basic Fee Rate [.]: The annual [b]((B))asic [f]((F))ee [r]((R))ate
shall be the sum of the [g]((G))roup [f]((F))ee [r]((R))ate and the
[i]((I))ndividual [f]((F))und [f]((F))ee [r]((R))ate calculated to the
nearest millionth decimal place as follows:
(i) Group Fee Rate. The Group [f]((F))ee [r]((R))ate 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 [charter] ((fund's
Declaration)) of ((Trust or ))[each] ((other)) [investment]
((organizational ))[company] ((document) ))determined as of the close of
business on each business day throughout the month. The Group [f]((F))ee
[r]((R))ate shall be determined on a cumulative basis pursuant to the
following schedule:
Average Net Assets Annualized Fee Rate (for each level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
[174 - 228 [.3000
228 - 282 .2950
282 - 336 .2900
Over - 336] .2850]
((174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over - 534 .2500))
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be
.45%.
(b) ((Basic Fee.)) One-twelfth of the [annual fee rate] ((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 [b]((B))asic [f]((F))ee. [The basic fee will be subject to
upward or downward on the basis of the Portfolio's investment performance
as follows:]
[(c) The Performance Adjustment. An adjustment to the monthly basic fee
will be made by applying a performance adjustment rate to the average net
assets of the Portfolio over the performance period. The resulting dollar
figure will be added or subtracted from the basic fee depending on whether
the Portfolio experienced better or worse performance than the index.]
(((c) Performance Adjustment Rate:)) The [p]((P))erformance
[a]((A))djustment [r]((R))ate is 0.02% for each percentage point [rounded
to the nearer point (the higher point if exactly one-half 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 performance adjustment rate is 0.20%.
The performance period will commence with the first day of the first full
month [of operation] following the Portfolio's commencement of operations.
During the first eleven months of the [operation of the Portfolio]
((performance period for the Portfolio,)) there will be no performance
adjustment. Starting with the twelfth month of the performance period, the
performance adjustment will take effect. Following the twelfth month a new
month will be added to the performance period until the performance period
equals 36 months. Thereafter the performance period will consist of the
current month plus the previous 35 months.
The Portfolio's investment performance will be measured by comparing (i)
the opening net asset value of one share of the Portfolio on the first
business day of the performance period with (ii) the closing net asset
value of one share of the Portfolio as of the last business day of such
period. In computing the investment performance of the Portfolio and the
investment record of the Index, distributions of realized capital gains,
the value of capital gains taxes per share paid or payable on undistributed
realized long-term capital gains accumulated to the end of such period and
dividends paid out of investment income on the part of the Portfolio, and
all cash distributions of the [companies] ((securities)) [whose]
((included)) [stocks comprise] ((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.
[The computation of the performance adjustment will not be cumulative. A
positive fee rate will apply 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 negative fee rate will apply
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.]
(d) ((Performance Adjustment.)) One-twelfth of the annual
[p]((P))erformance [a]((A))djustment [r]((R))ate [shall] ((will)) be
applied to the average of the net assets of the Portfolio (computed in the
manner set forth in the ((Fund's)) Declaration of Trust [of the Fund
adjusted as provided in paragraph (e) below, if applicable] ((or other
organizational document))) determined as of the close of business on each
business day throughout the month and the performance period. [The
resulting dollar amount is added to or deducted from the basic fee.]
(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 [b]((B))asic
[f]((F))ee [r]((R))ate will be computed on the basis of and applied to net
assets averaged over that month ending on the last business day on which
this Contract is in effect. The amount of this [p] ((P))erformance [a]
((A))djustment to the [b]((B))asic [f]((F))ee 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, [other
than those expressly stated to be payable by the Adviser hereunder,] 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,
[1994] ((1998)) 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.
(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 4
UNDERLINED DISCLOSURE WILL BE ADDED;
[BRACKETED] DISCLOSURE WILL BE DELETED.
FORM OF
MANAGEMENT CONTRACT
BETWEEN
FIDELITY INVESTMENT TRUST:
FIDELITY JAPAN FUND
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
((AGREEMENT AMENDED and RESTATED as of)) [AGREEMENT made] this [16th]
((___)) day of [July, 1992] ((_____ 1997,)) by ((and between)) Fidelity
Investment Trust, a Massachusetts business trust which may issue one or
more series of shares of beneficial interest (hereinafter called the
"Fund"), on behalf of Fidelity Japan 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
July 16, 1992, to a modification of said Contract in the manner set below.
The Amended Management Contract shall, when executed by duly authorized
officers of the Fund and Adviser, take effect on the later of October 1,
1997 or the first day of the month following approval.))
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the supervision
of the Fund's Board of Trustees, direct the investments of the Portfolio in
accordance with the investment objective, policies and limitations as
provided in the Portfolio's Prospectus or other governing instruments, as
amended from time to time, the Investment Company Act of 1940 and rules
thereunder, as amended from time to time (the "1940 Act"), and such other
limitations as the Portfolio may impose by notice in writing to the
Adviser. The Adviser shall also furnish for the use of the Portfolio office
space and all necessary office facilities, equipment and personnel for
servicing the investments of the Portfolio; and shall pay the salaries and
fees of all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all personnel of
the Fund or the Adviser performing services relating to research,
statistical and investment activities. The Adviser is authorized, in its
discretion and without prior consultation with the Portfolio, to buy, sell,
lend and otherwise trade in any stocks, bonds and other securities and
investment instruments on behalf of the Portfolio. The investment policies
and all other actions of the Portfolio are and shall at all times be
subject to the control and direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for the
performance by its affiliates of) the management and administrative
services necessary for the operation of the Fund. The Adviser shall,
subject to the supervision of the Board of Trustees, perform various
services for the Portfolio, including but not limited to: (i) providing the
Portfolio with office space, equipment and facilities (which may be its
own) for maintaining its organization; (ii) on behalf of the Portfolio,
supervising relations with, and monitoring the performance of, custodians,
depositories, transfer and pricing agents, accountants, attorneys,
underwriters, brokers and dealers, insurers and other persons in any
capacity deemed to be necessary or desirable; (iii) preparing all general
shareholder communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered, maintaining
the registration and qualification of the Portfolio's shares under federal
and state law; and (vii) investigating the development of and developing
and implementing, if appropriate, management and shareholder services
designed to enhance the value or convenience of the Portfolio as an
investment vehicle.
The Adviser shall also furnish such reports, evaluations, information or
analyses to the Fund as the Fund's Board of Trustees may request from time
to time or as the Adviser may deem to be desirable. The Adviser shall make
recommendations to the Fund's Board of Trustees with respect to Fund
policies, and shall carry out such policies as are adopted by the Trustees.
The Adviser shall, subject to review by the Board of Trustees, furnish such
other services as the Adviser shall from time to time determine to be
necessary or useful to perform its obligations under this Contract.
(c) The Adviser [at its own expense,] shall place all orders for the
purchase and sale of portfolio securities for the Portfolio's account with
brokers or dealers selected by the Adviser, which may include brokers or
dealers affiliated with the Adviser. The Adviser shall use its best efforts
to seek to execute portfolio transactions at prices which are advantageous
to the Portfolio and at commission rates which are reasonable in relation
to the benefits received. In selecting brokers or dealers qualified to
execute a particular transaction, brokers or dealers may be selected who
also provide brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) to the Portfolio
and/or the other accounts over which the Adviser or its affiliates exercise
investment discretion. The Adviser is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess of
the amount of commission another broker or dealer would have charged for
effecting that transaction if the Adviser determines in good faith that
such amount of commission is reasonable in relation to the value of the
brokerage and research services provided by such broker or dealer. This
determination may be viewed in terms of either that particular transaction
or the overall responsibilities which the Adviser and its affiliates have
with respect to accounts over which they exercise investment discretion.
The Trustees of the Fund shall periodically review the commissions paid by
the Portfolio to determine if the commissions paid over representative
periods of time were reasonable in relation to the benefits to the
Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor. The
Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of the
Fund are or may be or become interested in the Adviser as directors,
officers or otherwise and that directors, officers and stockholders of the
Adviser are or may be or become similarly interested in the Fund, and that
the Adviser may be or become interested in the Fund as a shareholder or
otherwise.
3. The Adviser will be compensated on the following basis for the services
and facilities to be furnished hereunder. The Adviser shall receive a
monthly management fee, payable monthly as soon as practicable after the
last day of each month, composed of a [b]((B))asic [f]((F))ee and a
[p]((P))erformance [a]((A))djustment [to the basic fee based upon the
investment performance of the Portfolio in relation to the]. ((The
Performance Adjustment is added to or subtracted from the Basic Fee
depending on whether the Portfolio experienced better or worse performance
than the)) Tokyo [Price] ((Stock Exchange ))Index (the "Index"). ((The
Performance Adjustment is not cumulative. An increased fee will result even
though the performance of the Portfolio over some period of time shorter
than the performance period has been behind that of the Index, and,
conversely, a reduction in the fee will be made for a month even though the
performance of the Portfolio over some period of time shorter than the
performance period has been ahead of that of the Index.)) The [b]((B))asic
[f]((F))ee and the [p]((P))erformance [a]((A))djustment will be computed as
follows:
(a) Basic Fee Rate [.]: The annual [b]((B))asic [f]((F))ee [r]((R))ate
shall be the sum of the [g]((G))roup [f]((F))ee [r]((R))ate and the
[i]((I))ndividual [f]((F))und [f]((F))ee [r]((R))ate calculated to the
nearest millionth decimal place as follows:
(i) Group Fee Rate. The Group [f]((F))ee [r]((R))ate 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 [charter] ((fund's
Declaration ))of(( Trust or)) [each] ((other)) [investment]
((organizational ))[company] ((document))) determined as of the close of
business on each business day throughout the month. The Group [f]((F))ee
[r]((R))ate shall be determined on a cumulative basis pursuant to the
following schedule:
Average Net Assets Annualized Fee Rate (for each level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
[Over 174] [.3000]
((174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over - 534 .2500))
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be
.45%.
(b) ((Basic Fee.)) One-twelfth of the [annual fee rate] ((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 [b]((B))asic [f]((F))ee. [The basic fee will be subject to
upward or downward on the basis of the Portfolio's investment performance
as follows:]
[(c) The Performance Adjustment: An adjustment to the monthly basic fee
will be made by applying a performance adjustment rate to the average net
assets of the Portfolio over the performance period. The resulting dollar
figure will be added or subtracted from the basic fee depending on whether
the Portfolio experienced better or worse performance than the Index.]
(((c) Performance Adjustment Rate:)) The [p]((P))erformance
[a]((A))djustment [r]((R))ate is 0.02% for each percentage point [rounded
to the nearer point (the higher point if exactly one-half 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 performance adjustment rate is 0.20%.
The performance period will commence with the first day of the first full
month [of operation] following the Portfolio's commencement of operations.
During the first eleven months of the [operation of the contract]
((performance period for the Portfolio,)) there will be no performance
adjustment. Starting with the twelfth month of the performance period, the
performance adjustment will take effect. Following the twelfth month a new
month will be added to the performance period until the performance period
equals 36 months. Thereafter the performance period will consist of the
current month plus the previous 35 months.
The Portfolio's investment performance will be measured by comparing (i)
the opening net asset value of one share of the Portfolio on the first
business day of the performance period with (ii) the closing net asset
value of one share of the Portfolio as of the last business day of such
period. In computing the investment performance of the Portfolio and the
investment record of the Index, distributions of realized capital gains,
the value of capital gains taxes per share paid or payable on undistributed
realized long-term capital gains accumulated to the end of such period and
dividends paid out of investment income on the part of the Portfolio, and
all cash distributions of the [companies] ((securities)) [whose]
((included)) [stocks comprise] ((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.
[The computation of the performance adjustment will not be cumulative. A
positive fee rate will apply 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 negative fee rate will apply
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.]
(d) ((Performance Adjustment.)) One-twelfth of the annual
[p]((P))erformance [a]((A))djustment [r]((R))ate [shall] ((will)) be
applied to the average of the net assets of the Portfolio (computed in the
manner set forth in the ((Fund's)) Declaration of Trust [of the Fund
adjusted as provided in paragraph (e) below, if applicable] ((or other
organizational document))) determined as of the close of business on each
business day throughout the month and the performance period. [The
resulting dollar amount is added to or deducted from the basic fee.]
(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 [b]((B))asic
[f]((F))ee [r]((R))ate will be computed on the basis of and applied to net
assets averaged over that month ending on the last business day on which
this Contract is in effect. The amount of this [p] ((P))erformance [a]
((A))djustment to the [b]((B))asic [f]((F))ee 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, [other
than those expressly stated to be payable by the Adviser hereunder,] 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,
[1993] ((1998)) 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.
(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 5
UNDERLINED DISCLOSURE WILL BE ADDED;
[BRACKETED] DISCLOSURE WILL BE DELETED.
FORM OF
MANAGEMENT CONTRACT
BETWEEN
FIDELITY INVESTMENT TRUST:
FIDELITY SOUTHEAST ASIA FUND
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
((AGREEMENT AMENDED and RESTATED as of)) [AGREEMENT made] this [18th]
((___)) day of [March, 1993] ((_____ 1997, ))by ((and between)) Fidelity
Investment Trust, a Massachusetts business trust which may issue one or
more series of shares of beneficial interest (hereinafter called the
"Fund"), on behalf of Fidelity Southeast Asia 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
March 18, 1993, to a modification of said Contract in the manner set below.
The Amended Management Contract shall, when executed by duly authorized
officers of the Fund and Adviser, take effect on the later of October 1,
1997 or the first day of the month following approval.))
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the supervision
of the Fund's Board of Trustees, direct the investments of the Portfolio in
accordance with the investment objective, policies and limitations as
provided in the Portfolio's Prospectus or other governing instruments, as
amended from time to time, the Investment Company Act of 1940 and rules
thereunder, as amended from time to time (the "1940 Act"), and such other
limitations as the Portfolio may impose by notice in writing to the
Adviser. The Adviser shall also furnish for the use of the Portfolio office
space and all necessary office facilities, equipment and personnel for
servicing the investments of the Portfolio; and shall pay the salaries and
fees of all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all personnel of
the Fund or the Adviser performing services relating to research,
statistical and investment activities. The Adviser is authorized, in its
discretion and without prior consultation with the Portfolio, to buy, sell,
lend and otherwise trade in any stocks, bonds and other securities and
investment instruments on behalf of the Portfolio. The investment policies
and all other actions of the Portfolio are and shall at all times be
subject to the control and direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for the
performance by its affiliates of) the management and administrative
services necessary for the operation of the Fund. The Adviser shall,
subject to the supervision of the Board of Trustees, perform various
services for the Portfolio, including but not limited to: (i) providing the
Portfolio with office space, equipment and facilities (which may be its
own) for maintaining its organization; (ii) on behalf of the Portfolio,
supervising relations with, and monitoring the performance of, custodians,
depositories, transfer and pricing agents, accountants, attorneys,
underwriters, brokers and dealers, insurers and other persons in any
capacity deemed to be necessary or desirable; (iii) preparing all general
shareholder communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered, maintaining
the registration and qualification of the Portfolio's shares under federal
and state law; and (vii) investigating the development of and developing
and implementing, if appropriate, management and shareholder services
designed to enhance the value or convenience of the Portfolio as an
investment vehicle.
The Adviser shall also furnish such reports, evaluations, information or
analyses to the Fund as the Fund's Board of Trustees may request from time
to time or as the Adviser may deem to be desirable. The Adviser shall make
recommendations to the Fund's Board of Trustees with respect to Fund
policies, and shall carry out such policies as are adopted by the Trustees.
The Adviser shall, subject to review by the Board of Trustees, furnish such
other services as the Adviser shall from time to time determine to be
necessary or useful to perform its obligations under this Contract.
(c) The Adviser [at its own expense,] shall place all orders for the
purchase and sale of portfolio securities for the Portfolio's account with
brokers or dealers selected by the Adviser, which may include brokers or
dealers affiliated with the Adviser. The Adviser shall use its best efforts
to seek to execute portfolio transactions at prices which are advantageous
to the Portfolio and at commission rates which are reasonable in relation
to the benefits received. In selecting brokers or dealers qualified to
execute a particular transaction, brokers or dealers may be selected who
also provide brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) to the Portfolio
and/or the other accounts over which the Adviser or its affiliates exercise
investment discretion. The Adviser is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess of
the amount of commission another broker or dealer would have charged for
effecting that transaction if the Adviser determines in good faith that
such amount of commission is reasonable in relation to the value of the
brokerage and research services provided by such broker or dealer. This
determination may be viewed in terms of either that particular transaction
or the overall responsibilities which the Adviser and its affiliates have
with respect to accounts over which they exercise investment discretion.
The Trustees of the Fund shall periodically review the commissions paid by
the Portfolio to determine if the commissions paid over representative
periods of time were reasonable in relation to the benefits to the
Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor. The
Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of the
Fund are or may be or become interested in the Adviser as directors,
officers or otherwise and that directors, officers and stockholders of the
Adviser are or may be or become similarly interested in the Fund, and that
the Adviser may be or become interested in the Fund as a shareholder or
otherwise.
3. The Adviser will be compensated on the following basis for the services
and facilities to be furnished hereunder. The Adviser shall receive a
monthly management fee, payable monthly as soon as practicable after the
last day of each month, composed of a [b]((B))asic [f]((F))ee and a
[p]((P))erformance [a]((A))djustment [to the basic fee based upon the
investment performance of the Portfolio in relation to the]. ((The
Performance Adjustment is added to or subtracted from the Basic Fee
depending on whether the Portfolio experienced better or worse performance
than the)) Morgan Stanley Capital International Combined Far East [Free ex
Japan] ((ex-Japan Free)) Index (the "Index"). ((The Performance Adjustment
is not cumulative. An increased fee will result even though the performance
of the Portfolio over some period of time shorter than the performance
period has been behind that of the Index, and, conversely, a reduction in
the fee will be made for a month even though the performance of the
Portfolio over some period of time shorter than the performance period has
been ahead of that of the Index.)) The [b]((B))asic [f]((F))ee and the
[p]((P))erformance [a]((A))djustment will be computed as follows:
(a) Basic Fee Rate [.]((:)) The annual [b]((B))asic [f]((F))ee
[r]((R))ate shall be the sum of the [g]((G))roup [f]((F))ee [r]((R))ate and
the [i]((I))ndividual [f]((F))und [f]((F))ee [r]((R))ate calculated to the
nearest millionth decimal place as follows:
(i) Group Fee Rate. The Group [f]((F))ee [r]((R))ate 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 [charter] ((fund's
Declaration)) of ((Trust or)) [each] ((other)) [investment]
((organizational)) [company] ((document))) determined as of the close of
business on each business day throughout the month. The Group [f]((F))ee
[r]((R))ate shall be determined on a cumulative basis pursuant to the
following schedule:
Average Net Assets Annualized Fee Rate (for each level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
[Over 174] [.3000]
((174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over - 534 .2500))
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be
.45%.
(b) ((Basic Fee.)) One-twelfth of the [annual fee rate] ((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 [b]((B))asic [f]((F))ee. [The basic fee will be subject to
upward or downward on the basis of the Portfolio's investment performance
as follows:]
[(c) The Performance Adjustment: An adjustment to the monthly basic fee
will be made by applying a performance adjustment rate to the average net
assets of the Portfolio over the performance period. The resulting dollar
figure will be added or subtracted from the basic fee depending on whether
the Portfolio experienced better or worse performance than the Index.]
(((c) Performance Adjustment Rate:)) The [p]((P))erformance
[a]((A))djustment [r]((R))ate is 0.02% for each percentage point [rounded
to the nearer point (the higher point if exactly one-half 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 performance adjustment rate is 0.20%.
The performance period will commence with the first day of the first full
month [of operation] following the Portfolio's commencement of operations.
During the first eleven months of the [operation of the contract]
((performance period for the Portfolio, ))there will be no performance
adjustment. Starting with the twelfth month of the performance period, the
performance adjustment will take effect. Following the twelfth month a new
month will be added to the performance period until the performance period
equals 36 months. Thereafter the performance period will consist of the
current month plus the previous 35 months.
The Portfolio's investment performance will be measured by comparing (i)
the opening net asset value of one share of the Portfolio on the first
business day of the performance period with (ii) the closing net asset
value of one share of the Portfolio as of the last business day of such
period. In computing the investment performance of the Portfolio and the
investment record of the Index, distributions of realized capital gains,
the value of capital gains taxes per share paid or payable on undistributed
realized long-term capital gains accumulated to the end of such period and
dividends paid out of investment income on the part of the Portfolio, and
all cash distributions of the [companies] ((securities)) [whose]
((included)) [stocks comprise] ((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.
[The computation of the performance adjustment will not be cumulative. A
positive fee rate will apply 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 negative fee rate will apply
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.]
(d) ((Performance Adjustment.)) One-twelfth of the annual
[p]((P))erformance [a]((A))djustment [r]((R))ate [shall] ((will)) be
applied to the average of the net assets of the Portfolio (computed in the
manner set forth in the ((Fund's)) Declaration of Trust [of the Fund
adjusted as provided in paragraph (e) below, if applicable] ((or other
organizational document))) determined as of the close of business on each
business day throughout the month and the performance period. [The
resulting dollar amount is added to or deducted from the basic fee.]
(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 [b]((B))asic
[f]((F))ee [r]((R))ate will be computed on the basis of and applied to net
assets averaged over that month ending on the last business day on which
this Contract is in effect. The amount of this [p] ((P))erformance [a]
((A))djustment to the [b] ((B))asic [f]((F))ee 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((,))
[other than those expressly stated to be payable by the Adviser hereunder,]
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,
[1993] ((1998)) 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.
(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 6
UNDERLINED DISCLOSURE WILL BE ADDED;
[BRACKETED] DISCLOSURE WILL BE DELETED.
FORM OF
MANAGEMENT CONTRACT
BETWEEN
FIDELITY INVESTMENT TRUST:
FIDELITY LATIN AMERICA FUND
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
((AGREEMENT AMENDED and RESTATED as of)) [AGREEMENT made] this [18th]
((___)) day of [March, 1993] ((_____ 1997, ))by ((and between)) Fidelity
Investment Trust, a Massachusetts business trust which may issue one or
more series of shares of beneficial interest (hereinafter called the
"Fund"), on behalf of Fidelity Southeast Asia 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
March 18, 1993, to a modification of said Contract in the manner set below.
The Amended Management Contract shall, when executed by duly authorized
officers of the Fund and Adviser, take effect on the later of October 1,
1997 or the first day of the month following approval.))
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the supervision
of the Fund's Board of Trustees, direct the investments of the Portfolio in
accordance with the investment objective, policies and limitations as
provided in the Portfolio's Prospectus or other governing instruments, as
amended from time to time, the Investment Company Act of 1940 and rules
thereunder, as amended from time to time (the "1940 Act"), and such other
limitations as the Portfolio may impose by notice in writing to the
Adviser. The Adviser shall also furnish for the use of the Portfolio office
space and all necessary office facilities, equipment and personnel for
servicing the investments of the Portfolio; and shall pay the salaries and
fees of all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all personnel of
the Fund or the Adviser performing services relating to research,
statistical and investment activities. The Adviser is authorized, in its
discretion and without prior consultation with the Portfolio, to buy, sell,
lend and otherwise trade in any stocks, bonds and other securities and
investment instruments on behalf of the Portfolio. The investment policies
and all other actions of the Portfolio are and shall at all times be
subject to the control and direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for the
performance by its affiliates of) the management and administrative
services necessary for the operation of the Fund. The Adviser shall,
subject to the supervision of the Board of Trustees, perform various
services for the Portfolio, including but not limited to: (i) providing the
Portfolio with office space, equipment and facilities (which may be its
own) for maintaining its organization; (ii) on behalf of the Portfolio,
supervising relations with, and monitoring the performance of, custodians,
depositories, transfer and pricing agents, accountants, attorneys,
underwriters, brokers and dealers, insurers and other persons in any
capacity deemed to be necessary or desirable; (iii) preparing all general
shareholder communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered, maintaining
the registration and qualification of the Portfolio's shares under federal
and state law; and (vii) investigating the development of and developing
and implementing, if appropriate, management and shareholder services
designed to enhance the value or convenience of the Portfolio as an
investment vehicle.
The Adviser shall also furnish such reports, evaluations, information or
analyses to the Fund as the Fund's Board of Trustees may request from time
to time or as the Adviser may deem to be desirable. The Adviser shall make
recommendations to the Fund's Board of Trustees with respect to Fund
policies, and shall carry out such policies as are adopted by the Trustees.
The Adviser shall, subject to review by the Board of Trustees, furnish such
other services as the Adviser shall from time to time determine to be
necessary or useful to perform its obligations under this Contract.
(c) The Adviser [at its own expense,] shall place all orders for the
purchase and sale of portfolio securities for the Portfolio's account with
brokers or dealers selected by the Adviser, which may include brokers or
dealers affiliated with the Adviser. The Adviser shall use its best efforts
to seek to execute portfolio transactions at prices which are advantageous
to the Portfolio and at commission rates which are reasonable in relation
to the benefits received. In selecting brokers or dealers qualified to
execute a particular transaction, brokers or dealers may be selected who
also provide brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934) to the Portfolio
and/or the other accounts over which the Adviser or its affiliates exercise
investment discretion. The Adviser is authorized to pay a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction for the Portfolio which is in excess of
the amount of commission another broker or dealer would have charged for
effecting that transaction if the Adviser determines in good faith that
such amount of commission is reasonable in relation to the value of the
brokerage and research services provided by such broker or dealer. This
determination may be viewed in terms of either that particular transaction
or the overall responsibilities which the Adviser and its affiliates have
with respect to accounts over which they exercise investment discretion.
The Trustees of the Fund shall periodically review the commissions paid by
the Portfolio to determine if the commissions paid over representative
periods of time were reasonable in relation to the benefits to the
Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor. The
Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of the
Fund are or may be or become interested in the Adviser as directors,
officers or otherwise and that directors, officers and stockholders of the
Adviser are or may be or become similarly interested in the Fund, and that
the Adviser may be or become interested in the Fund as a shareholder or
otherwise.
3. The Adviser will be compensated on the following basis for the services
and facilities to be furnished hereunder. The Adviser shall receive a
monthly management fee, payable monthly as soon as practicable after the
last day of each month, [which shall be computed as follows:] composed of a
Group Fee and an Individual Fund Fee.
[The fee rate shall be composed of two elements.]
[(i)] (((a))) Group Fee Rate. The Group [f]((F))ee [r]((R))ate 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 [charter]
((fund's Declaration)) of ((Trust or)) [each] ((other ))[investment]
((organizational ))[company] ((document))) determined as of the close of
business on each business day throughout the month. The Group [f]((F))ee
[r]((R))ate shall be determined on a cumulative basis pursuant to the
following schedule:
Average Net Assets Annualized Fee Rate (for each level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
[Over 174] [.3000]
((174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over - 534 .2500))
[(ii)] (b) Individual Fund Fee Rate. The [i] ((I))ndividual [f] ((F))und
[f] ((F))ee [r] ((R))ate shall be .45%.
The sum of the Group [f] ((F))ee [r] ((R))ate, calculated as described
above to the nearest millionth, and the Individual Fund [f] ((F))ee [r]
((R))ate shall constitute the [a] ((A))nnual ((Management)) [f] ((F))ee [r]
((R))ate. One-twelfth of the [a] ((A))nnual ((Management)) [f] ((F))ee [r]
((R))ate 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
[of the Fund)] ((or other organizational document)) determined as of the
close of business on each business day throughout the month.
(((c))) In case of termination of this Contract during any month, the fee
for that month shall be reduced proportionately on the basis of the number
of business days during which it is in effect for that month. The
[b]((B))asic [f]((F))ee [r]((R))ate will be computed on the basis of and
applied to net assets averaged over that month ending on the last business
day on which this Contract is in effect. The amount of this [p]
((P))erformance [a] ((A))djustment to the [b]((B))asic [f]((F))ee 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, [other
than those expressly stated to be payable by the Adviser hereunder,] 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,
[1993] ((1998)) 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.
(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 7
THE PROPER NAME OF EACH FUND -
FIDELITY FRANCE FUND, FIDELITY GERMANY FUND, FIDELITY HONG KONG AND CHINA
FUND,
FIDELITY JAPAN SMALL COMPANIES FUND, FIDELITY NORDIC FUND, AND FIDELITY
UNITED KINGDOM FUND
WILL BE INSERTED IN EACH RESPECTIVE FUND'S CONTRACT WHERE INDICATED BY
(NAME OF PORTFOLIO).
UNDERLINED DISCLOSURE WILL BE ADDED;
[BRACKETED] DISCLOSURE WILL BE DELETED.
FORM OF
MANAGEMENT CONTRACT
BETWEEN
FIDELITY INVESTMENT TRUST:
(NAME OF PORTFOLIO)
FIDELITY MANAGEMENT & RESEARCH COMPANY
((AGREEMENT AMENDED and RESTATED as of)) [AGREEMENT] [made ] this
[1st]((___)) day of [November 1995] ((_____ 1997,)) by and between Fidelity
Investment Trust, a Massachusetts business trust which may issue one or
more series of shares of beneficial interest (hereinafter called the
"Fund"), on behalf of (Name of Portfolio) (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
November 1, 1995, to a modification of said Contract in the manner set
below. The Amended Management Contract shall, when executed by duly
authorized officers of the Fund and Adviser, take effect on October 1, 1997
or the first day of the month following approval.))
1. (a) Investment Advisory Services. The Adviser undertakes to act as
investment adviser of the Portfolio and shall, subject to the supervision
of the Fund's Board of Trustees, direct the investments of the Portfolio in
accordance with the investment objective, policies and limitations as
provided in the Portfolio's Prospectus or other governing instruments, as
amended from time to time, the Investment Company Act of 1940 and rules
thereunder, as amended from time to time (the "1940 Act"), and such other
limitations as the Portfolio may impose by notice in writing to the
Adviser. The Adviser shall also furnish for the use of the Portfolio office
space and all necessary office facilities, equipment and personnel for
servicing the investments of the Portfolio; and shall pay the salaries and
fees of all officers of the Fund, of all Trustees of the Fund who are
"interested persons" of the Fund or of the Adviser and of all personnel of
the Fund or the Adviser performing services relating to research,
statistical and investment activities. The Adviser is authorized, in its
discretion and without prior consultation with the Portfolio, to buy, sell,
lend and otherwise trade in any stocks, bonds and other securities and
investment instruments on behalf of the Portfolio. The investment policies
and all other actions of the Portfolio are and shall at all times be
subject to the control and direction of the Fund's Board of Trustees.
(b) Management Services. The Adviser shall perform (or arrange for the
performance by its affiliates of) the management and administrative
services necessary for the operation of the Fund. The Adviser shall,
subject to the supervision of the Board of Trustees, perform various
services for the Portfolio, including but not limited to: (i) providing the
Portfolio with office space, equipment and facilities (which may be its
own) for maintaining its organization; (ii) on behalf of the Portfolio,
supervising relations with, and monitoring the performance of, custodians,
depositories, transfer and pricing agents, accountants, attorneys,
underwriters, brokers and dealers, insurers and other persons in any
capacity deemed to be necessary or desirable; (iii) preparing all general
shareholder communications, including shareholder reports; (iv) conducting
shareholder relations; (v) maintaining the Fund's existence and its
records; (vi) during such times as shares are publicly offered, maintaining
the registration and qualification of the Portfolio's shares under federal
and state law; and (vii) investigating the development of and developing
and implementing, if appropriate, management and shareholder services
designed to enhance the value or convenience of the Portfolio as an
investment vehicle.
The Adviser shall also furnish such reports, evaluations, information or
analyses to the Fund as the Fund's Board of Trustees may request from time
to time or as the Adviser may deem to be desirable. The Adviser shall make
recommendations to the Fund's Board of Trustees with respect to Fund
policies, and shall carry out such policies as are adopted by the Trustees.
The Adviser shall, subject to review by the Board of Trustees, furnish such
other services as the Adviser shall from time to time determine to be
necessary or useful to perform its obligations under this Contract.
(c) The Adviser shall place all orders for the purchase and sale of
portfolio securities for the Portfolio's account with brokers or dealers
selected by the Adviser, which may include brokers or dealers affiliated
with the Adviser. The Adviser shall use its best efforts to seek to execute
portfolio transactions at prices which are advantageous to the Portfolio
and at commission rates which are reasonable in relation to the benefits
received. In selecting brokers or dealers qualified to execute a particular
transaction, brokers or dealers may be selected who also provide brokerage
and research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Portfolio and/or the other accounts
over which the Adviser or its affiliates exercise investment discretion.
The Adviser is authorized to pay a broker or dealer who provides such
brokerage and research services a commission for executing a portfolio
transaction for the Portfolio which is in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction if the Adviser determines in good faith that such amount of
commission is reasonable in relation to the value of the brokerage and
research services provided by such broker or dealer. This determination may
be viewed in terms of either that particular transaction or the overall
responsibilities which the Adviser and its affiliates have with respect to
accounts over which they exercise investment discretion. The Trustees of
the Fund shall periodically review the commissions paid by the Portfolio to
determine if the commissions paid over representative periods of time were
reasonable in relation to the benefits to the Portfolio.
The Adviser shall, in acting hereunder, be an independent contractor. The
Adviser shall not be an agent of the Portfolio.
2. It is understood that the Trustees, officers and shareholders of the
Fund are or may be or become interested in the Adviser as directors,
officers or otherwise and that directors, officers and stockholders of the
Adviser are or may be or become similarly interested in the Fund, and that
the Adviser may be or become interested in the Fund as a shareholder or
otherwise.
3. The Adviser will be compensated on the following basis for the services
and facilities to be furnished hereunder. The Adviser shall receive a
monthly management fee, payable monthly as soon as practicable after the
last day of each month, composed of a Group Fee and an Individual Fund Fee.
(a) Group Fee Rate. The Group Fee Rate shall be based upon the monthly
average of the net assets of the registered investment companies having
Advisory and Service or Management Contracts with the Adviser (computed in
the manner set forth in the fund's Declaration of Trust or other
organizational document) determined as of the close of business on each
business day throughout the month. The Group Fee Rate shall be determined
on a cumulative basis pursuant to the following schedule:
Average Net Assets Annualized Fee Rate (for each level)
0 - $ 3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
[Over - 390] [.2700]
((390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over 534 .2500))
(b) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be .45%.
The sum of the Group Fee Rate, calculated as described above to the
nearest millionth, and the Individual Fund Fee Rate shall constitute the
Annual Management Fee Rate. One-twelfth of the Annual Management Fee Rate
shall be applied to the average of the net assets of the Portfolio
(computed in the manner set forth in the Fund's Declaration of Trust or
other organizational document) determined as of the close of business on
each business day throughout the month.
(c) In case of termination of this Contract during any month, the fee for
that month shall be reduced proportionately on the basis of the number of
business days during which it is in effect, and the fee computed upon the
average net assets for the business days it is so in effect for that month.
4. It is understood that the Portfolio will pay all its expenses, which
expenses payable by the Portfolio shall include, without limitation, (i)
interest and taxes; (ii) brokerage commissions and other costs in
connection with the purchase or sale of securities and other investment
instruments; (iii) fees and expenses of the Fund's Trustees other than
those who are "interested persons" of the Fund or the Adviser; (iv) legal
and audit expenses; (v) custodian, registrar and transfer agent fees and
expenses; (vi) fees and expenses related to the registration and
qualification of the Fund and the Portfolio's shares for distribution under
state and federal securities laws; (vii) expenses of printing and mailing
reports and notices and proxy material to shareholders of the Portfolio;
(viii) all other expenses incidental to holding meetings of the Portfolio's
shareholders, including proxy solicitations therefor; (ix) a pro rata
share, based on relative net assets of the Portfolio and other registered
investment companies having Advisory and Service or Management Contracts
with the Adviser, of 50% of insurance premiums for fidelity and other
coverage; (x) its proportionate share of association membership dues; (xi)
expenses of typesetting for printing Prospectuses and Statements of
Additional Information and supplements thereto; (xii) expenses of printing
and mailing Prospectuses and Statements of Additional Information and
supplements thereto sent to existing shareholders; and (xiii) such
non-recurring or extraordinary expenses as may arise, including those
relating to actions, suits or proceedings to which the Portfolio is a party
and the legal obligation which the Portfolio may have to indemnify the
Fund's Trustees and officers with respect thereto.
5. The services of the Adviser to the Portfolio are not to be deemed
exclusive, the Adviser being free to render services to others and engage
in other activities, provided, however, that such other services and
activities do not, during the term of this Contract, interfere, in a
material manner, with the Adviser's ability to meet all of its obligations
with respect to rendering services to the Portfolio hereunder. In the
absence of willful misfeasance, bad faith, gross negligence or reckless
disregard of obligations or duties hereunder on the part of the Adviser,
the Adviser shall not be subject to liability to the Portfolio or to any
shareholder of the Portfolio for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that may be
sustained in the purchase, holding or sale of any security or other
investment instrument.
6. (a) Subject to prior termination as provided in sub-paragraph (d) of
this paragraph 6, this Contract shall continue in force until July 31,
[1997] ((1998)) 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.
(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 8
FORM OF
SUB-ADVISORY AGREEMENT
BETWEEN
FIDELITY INVESTMENTS JAPAN LIMITED
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
AND
FIDELITY INVESTMENT TRUST ON BEHALF OF
FIDELITY DIVERSIFIED INTERNATIONAL FUND
AGREEMENT made this ((___)) day of ((____,)). 1997, by and between
Fidelity Management & Research Company, a Massachusetts corporation with
principal offices at 82 Devonshire Street, Boston, Massachusetts
(hereinafter called the "Advisor"); Fidelity Investments Japan Limited, a
Japanese company with principal offices at Shiroyama JT Mori Bldg., 4-3-1
Toranomon Minato-ku, Tokyo 105, Japan (hereinafter called the
"Sub-Advisor"); and Fidelity Investment Trust, a Massachusetts business
trust which may issue one or more series of shares of beneficial interest
(hereinafter called the "Trust") on behalf of Fidelity Diversified
International Fund (hereinafter called the "Portfolio").
WHEREAS the Trust and the Advisor have entered into a Management Contract
on behalf of the Portfolio, pursuant to which the Advisor is to act as
investment manager of the Portfolio; and
WHEREAS the Sub-Advisor has been formed in part for the purpose of
researching and compiling information and recommendations with respect to
the economies of various countries, and securities of issuers located in
such countries, and providing investment advisory services in connection
therewith;
NOW, THEREFORE, in consideration of the premises and the mutual promises
hereinafter set forth, the Trust, the Advisor and the Sub-Advisor agree as
follows:
1. Duties: The Advisor may, in its discretion, appoint the Sub-Advisor to
perform one or more of the following services with respect to all or a
portion of the investments of the Portfolio. The services and the portion
of the investments of the Portfolio to be advised or managed by the
Sub-Advisor shall be as agreed upon from time to time by the Advisor and
the Sub-Advisor. The Sub-Advisor shall pay the salaries and fees of all
personnel of the Sub-Advisor performing services for the Portfolio relating
to research, statistical and investment activities.
(a) INVESTMENT ADVICE: If and to the extent requested by the Advisor, the
Sub-Advisor shall provide investment advice to the Portfolio and the
Advisor with respect to all or a portion of the investments of the
Portfolio, and in connection with such advice shall furnish the Portfolio
and the Advisor such factual information, research reports and investment
recommendations as the Advisor may reasonably require. Such information may
include written and oral reports and analyses.
(b) INVESTMENT MANAGEMENT: If and to the extent requested by the
Advisor, the Sub-Advisor shall, subject to the supervision of the Advisor,
manage all or a portion of the investments of the Portfolio in accordance
with the investment objective, policies and limitations provided in the
Portfolio's Prospectus or other governing instruments, as amended from time
to time, the Investment Company Act of 1940 (the"1940 Act") and rules
thereunder, as amended from time to time, and such other limitations as the
Trust or Advisor may impose with respect to the Portfolio by notice to the
Sub-Advisor. With respect to the portion of the investments of the
Portfolio under its management, the Sub-Advisor is authorized to make
investment decisions on behalf of the Portfolio with regard to any stock,
bond, other security or investment instrument, and to place orders for the
purchase and sale of such securities through such broker-dealers as the
Sub-Advisor may select. The Sub-Advisor may also be authorized, but only to
the extent such duties are delegated in writing by the Advisor, to provide
additional investment management services to the Portfolio, including but
not limited to services such as managing foreign currency investments,
purchasing and selling or writing futures and options contracts, borrowing
money, or lending securities on behalf of the Portfolio. All investment
management and any other activities of the Sub-Advisor shall at all times
be subject to the control and direction of the Advisor and the Trust's
Board of Trustees.
(c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or all
of the services contemplated by this Agreement directly or through such of
its subsidiaries or other affiliated persons as the Sub-Advisor shall
determine; provided, however, that performance of such services through
such subsidiaries or other affiliated persons shall have been approved by
the Trust to the extent required pursuant to the 1940 Act and rules
thereunder.
2. Information to be Provided to the Trust and the Advisor: The
Sub-Advisor shall furnish such reports, evaluations, information or
analyses to the Trust and the Advisor as the Trust's Board of Trustees or
the Advisor may reasonably request from time to time, or as the Sub-Advisor
may deem to be desirable.
3. Brokerage: In connection with the services provided under subparagraph
(b) of paragraph 1 of this Agreement, the Sub-Advisor shall place all
orders for the purchase and sale of portfolio securities for the
Portfolio's account with brokers or dealers selected by the Sub-Advisor,
which may include brokers or dealers affiliated with the Advisor or
Sub-Advisor. The Sub-Advisor shall use its best efforts to seek to execute
portfolio transactions at prices which are advantageous to the Portfolio
and at commission rates which are reasonable in relation to the benefits
received. In selecting brokers or dealers qualified to execute a particular
transaction, brokers or dealers may be selected who also provide brokerage
and research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of l934) to the Portfolio and/or to the other
accounts over which the Sub-Advisor or Advisor exercise investment
discretion. The Sub-Advisor is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for executing a
portfolio transaction for the Portfolio which is in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction if the Sub-Advisor determines in good faith that such amount of
commission is reasonable in relation to the value of the brokerage and
research services provided by such broker or dealer. This determination may
be viewed in terms of either that particular transaction or the overall
responsibilities which the Sub-Advisor has with respect to accounts over
which it exercises investment discretion. The Trustees of the Trust shall
periodically review the commissions paid by the Portfolio to determine if
the commissions paid over representative periods of time were reasonable in
relation to the benefits to the Portfolio.
4. Compensation: The Advisor shall compensate the Sub-Advisor on the
following basis for the services to be furnished hereunder.
(a) INVESTMENT ADVISORY FEE: For services provided under subparagraph (a)
of paragraph 1 of this Agreement, the Advisor agrees to pay the Sub-Advisor
a monthly Sub-Advisory Fee. The Sub-Advisory Fee shall be equal to: (i) 30%
of the monthly management fee rate (including performance adjustments, if
any) that the Portfolio is obligated to pay the Advisor under its
Management Contract with the Advisor, multiplied by (ii) the fraction equal
to the net assets of the Portfolio as to which the Sub-Advisor shall have
provided investment advice divided by the net assets of the Portfolio for
that month. The Sub-Advisory Fee shall not be reduced to reflect expense
reimbursements or fee waivers by the Advisor, if any, in effect from time
to time.
(b) INVESTMENT MANAGEMENT FEE: For services provided under subparagraph
(b) of paragraph 1 of this Agreement, the Advisor agrees to pay the
Sub-Advisor a monthly Investment Management Fee. The Investment Management
Fee shall be equal to: (i) 50% of the monthly management fee rate
(including performance adjustments, if any) that the Portfolio is obligated
to pay the Advisor under its Management Contract with the Advisor,
multiplied by: (ii) the fraction equal to the net assets of the Portfolio
as to which the Sub-Advisor shall have provided investment management
services divided by the net assets of the Portfolio for that month. If in
any fiscal year the aggregate expenses of the Portfolio exceed any
applicable expense limitation imposed by any state or federal securities
laws or regulations, and the Advisor waives all or a portion of its
management fee or reimburses the Portfolio for expenses to the extent
required to satisfy such limitation, the Investment Management Fee paid to
the Sub-Advisor will be reduced by 50% of the amount of such waivers or
reimbursements multiplied by the fraction determined in (ii). If the
Sub-Advisor reduces its fees to reflect such waivers or reimbursements and
the Advisor subsequently recovers all or any portion of such waivers and
reimbursements, then the Sub-Advisor shall be entitled to receive from the
Advisor a proportionate share of the amount recovered. To the extent that
waivers and reimbursements by the Advisor required by such limitations are
in excess of the Advisor's management fee, the Investment Management Fee
paid to the Sub-Advisor will be reduced to zero for that month, but in no
event shall the Sub-Advisor be required to reimburse the Advisor for all or
a portion of such excess reimbursements.
(c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have
provided both investment advisory services under subparagraph (a) and
investment management services under subparagraph (b) of paragraph 1 for
the same portion of the investments of the Portfolio for the same period,
the fees paid to the Sub-Advisor with respect to such investments shall be
calculated exclusively under subparagraph (b) of this paragraph 4.
5. Expenses: It is understood that the Portfolio will pay all of its
expenses other than those expressly stated to be payable by the Sub-Advisor
hereunder or by the Advisor under the Management Contract with the
Portfolio, which expenses payable by the Portfolio shall include, without
limitation, (i) interest and taxes; (ii) brokerage commissions and other
costs in connection with the purchase or sale of securities and other
investment instruments; (iii) fees and expenses of the Trust's Trustees
other than those who are "interested persons" of the Trust, the Sub-Advisor
or the Advisor; (iv) legal and audit expenses; (v) custodian, registrar and
transfer agent fees and expenses; (vi) fees and expenses related to the
registration and qualification of the Trust and the Portfolio's shares for
distribution under state and federal securities laws; (vii) expenses of
printing and mailing reports and notices and proxy material to shareholders
of the Portfolio; (viii) all other expenses incidental to holding meetings
of the Portfolio's shareholders, including proxy solicitations 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 Advisor, of 50% of insurance premiums for
fidelity and other coverage; (x) its proportionate share of association
membership dues; (xi) expenses of typesetting for printing Prospectuses and
Statements of Additional Information and supplements thereto; (xii)
expenses of printing and mailing Prospectuses and Statements of Additional
Information and supplements thereto sent to existing shareholders; and
(xiii) such non-recurring or extraordinary expenses as may arise, including
those relating to actions, suits or proceedings to which the Portfolio is a
party and the legal obligation which the Portfolio may have to indemnify
the Trust's Trustees and officers with respect thereto.
6. Interested Persons: It is understood that Trustees, officers, and
shareholders of the Trust are or may be or become interested in the Advisor
or the Sub-Advisor as directors, officers or otherwise and that directors,
officers and stockholders of the Advisor or the Sub-Advisor are or may be
or become similarly interested in the Trust, and that the Advisor or the
Sub-Advisor may be or become interested in the Trust as a shareholder or
otherwise.
7. Services to Other Companies or Accounts: The services of the
Sub-Advisor to the Advisor are not to be deemed to be exclusive, the
Sub-Advisor being free to render services to others and engage in other
activities, provided, however, that such other services and activities do
not, during the term of this Agreement, interfere, in a material manner,
with the Sub-Advisor's ability to meet all of its obligations hereunder.
The Sub-Advisor shall for all purposes be an independent contractor and not
an agent or employee of the Advisor or the Trust.
8. Standard of Care: In the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of obligations or duties hereunder
on the part of the Sub-Advisor, the Sub-Advisor shall not be subject to
liability to the Advisor, the Trust or to any shareholder of the Portfolio
for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the purchase,
holding or sale of any security.
9. Duration and Termination of Agreement; Amendments:
(a) Subject to prior termination as provided in subparagraph (d) of this
paragraph 9, this Agreement shall continue in force until July 31, 1998 and
indefinitely thereafter, but only so long as the continuance after such
period shall be specifically approved at least annually by vote of the
Trust's Board of Trustees or by vote of a majority of the outstanding
voting securities of the Portfolio.
(b) This Agreement may be modified by mutual consent of the Advisor, the
Sub-Advisor and the Portfolio, such consent on the part of the Portfolio to
be authorized by vote of a majority of the outstanding voting securities of
the Portfolio.
(c) In addition to the requirements of subparagraphs (a) and (b) of this
paragraph 9, the terms of any continuance or modification of this Agreement
must have been approved by the vote of a majority of those Trustees of the
Trust who are not parties to this Agreement or interested persons of any
such party, cast in person at a meeting called for the purpose of voting on
such approval.
(d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any time
on sixty (60) days' prior written notice to the other parties, terminate
this Agreement, without payment of any penalty, by action of its Board of
Trustees or Directors, or with respect to the Portfolio by vote of a
majority of its outstanding voting securities. This Agreement shall
terminate automatically in the event of its assignment.
10. Limitation of Liability: The Sub-Advisor is hereby expressly put on
notice of the limitation of shareholder liability as set forth in the
Declaration of Trust or other organizational document of the Trust and
agrees that any obligations of the Trust or the Portfolio arising in
connection with this Agreement shall be limited in all cases to the
Portfolio and its assets, and the Sub-Advisor shall not seek satisfaction
of any such obligation from the shareholders or any shareholder of the
Portfolio. Nor shall the Sub-Advisor seek satisfaction of any such
obligation from the Trustees or any individual Trustee.
11. Governing Law: This Agreement shall be governed by, and construed in
accordance with, the laws of the Commonwealth of Massachusetts, without
giving effect to the choice of laws provisions thereof.
The terms "registered investment company," "vote of a majority of the
outstanding voting securities," "assignment," and "interested persons,"
when used herein, shall have the respective meanings specified in the 1940
Act as now in effect or as hereafter amended.
IN WITNESS WHEREOF the parties hereto have caused this instrument to be
signed in their behalf by their respective officers thereunto duly
authorized, all as of the date written above.
[SIGNATURE LINES OMITTED]
EXHIBIT 9
THE PROPER NAME OF EACH FUND -
FIDELITY DIVERSIFIED INTERNATIONAL FUND AND FIDELITY INTERNATIONAL VALUE
FUND -
WILL BE INSERTED IN EACH RESPECTIVE FUND'S CONTRACT WHERE INDICATED BY
(NAME OF PORTFOLIO).
FORM OF
DISTRIBUTION AND SERVICE PLAN
OF FIDELITY INVESTMENT TRUST:
(NAME OF PORTFOLIO)
1. This Distribution and Service Plan (the "Plan"), when effective in
accordance with its terms, shall be the written plan contemplated by Rule
12b-1 under the Investment Company Act of 1940 (the "Act") of (Name of
Portfolio) (the "Portfolio"), a series of shares of Fidelity Investment
Trust (the "Fund").
2. The Fund has entered into a General Distribution Agreement with respect
to the Portfolio with Fidelity Distributors Corporation (the
"Distributor"), a wholly-owned subsidiary of Fidelity Management & Research
Company (the "Adviser"), under which the Distributor uses all reasonable
efforts, consistent with its other business, to secure purchasers for the
Portfolio's shares of beneficial interest ("shares"). Under the agreement,
the Distributor pays the expenses of printing and distributing any
prospectuses, reports and other literature used by the Distributor,
advertising, and other promotional activities in connection with the
offering of shares of the Portfolio for sale to the public. It is
recognized that the "Adviser" may use its management fee revenues as well
as past profits or its resources from any other source, to make payment to
the Distributor with respect to any expenses incurred in connection with
the distribution of Portfolio shares, including the activities referred to
above.
3. The Adviser directly, or through the Distributor, may, subject to the
approval of the Trustees, make payments to securities dealers and other
third parties who engage in the sale of shares or who render shareholder
support services, including but not limited to providing office space,
equipment and telephone facilities, answering routine inquiries regarding
the Portfolio, processing shareholder transactions and providing such other
shareholder services as the Fund may reasonably request.
4. The Portfolio will not make separate payments as a result of this Plan
to the Adviser, Distributor or any other party, it being recognized that
the Portfolio presently pays, and will continue to pay, a management fee to
the Adviser. To the extent that any payments made by the Portfolio to the
Adviser, including payment of management fees, should be deemed to be
indirect financing of any activity primarily intended to result in the sale
of shares of the Portfolio within the context of Rule 12b-1 under the Act,
then such payments shall be deemed to be authorized by this Plan.
5. This Plan shall become effective upon the first business day of the
month following approval by a vote of at least a "majority of the
outstanding voting securities of the Portfolio" (as defined in the Act),
the plan having been approved by a vote of a majority of the Trustees of
the Fund, including a majority of Trustees who are not "interested persons"
of the Fund (as defined in the Act) and who have no direct or indirect
financial interest in the operation of this Plan or in any agreements
related to this Plan (the "Independent Trustees"), cast in person at a
meeting called for the purpose of voting on this Plan.
6. This Plan shall, unless terminated as hereinafter provided, remain in
effect from the date specified above until April 30, 1998 and from year to
year thereafter, provided, however, that such continuance is subject to
approval annually by a vote of a majority of the Trustees of the Fund,
including a majority of the Independent Trustees, cast in person at a
meeting called for the purpose of voting on this Plan. This Plan may be
amended at any time by the Board of Trustees, provided that (a) any
amendment to authorize direct payments by the Portfolio to finance any
activity primarily intended to result in the sale of shares of the
Portfolio, to increase materially the amount spent by the Portfolio for
distribution, or any amendment of the Management Contract to increase the
amount to be paid by the Portfolio thereunder shall be effective only upon
approval by a vote of a majority of the outstanding voting securities of
the Portfolio, and (b) any material amendments of this Plan shall be
effective only upon approval in the manner provided in the first sentence
in this paragraph.
7. This Plan may be terminated at any time, without the payment of any
penalty, by vote of a majority of the Independent Trustees or by a vote of
a majority of the outstanding voting securities of the Portfolio.
8. During the existence of this Plan, the Fund shall require the Adviser
and/or Distributor to provide the Fund, for review by the Fund's Board of
Trustees, and the Trustees shall review, at least quarterly, a written
report of the amounts expended in connection with financing any activity
primarily intended to result in the sale of shares of the Portfolio (making
estimates of such costs where necessary or desirable) and the purposes for
which such expenditures were made.
9. This Plan does not require the Adviser or Distributor to perform any
specific type or level of distribution activities or to incur any specific
level of expenses for activities primarily intended to result in the sale
of shares of the Portfolio.
10. Consistent with the limitation of shareholder liability as set forth
in the Fund's Declaration of Trust or other organizational document, any
obligations assumed by the Portfolio pursuant to this Plan and any
agreements related to this Plan shall be limited in all cases to the
Portfolio and its assets, and shall not constitute obligations of any other
series of shares of the Fund.
11. If any provision of this Plan shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of the Plan shall not
be affected thereby.
EXHIBIT 10
FUNDS ADVISED BY FMR - TABLE OF AVERAGE NET ASSETS AND EXPENSE RATIOS (A)
<TABLE>
<CAPTION>
INVESTMENT FISCAL AVERAGE RATIO OF NET
OBJECTIVE AND FUND YEAR END (A) NET ASSETS ADVISORY FEES
(MILLIONS)(B) TO AVERAGE
NET ASSETS
PAID
TO FMR (C)
<S> <C> <C> <C> <C>
GROWTH
Fidelity Fifty ((pound)) 6/30/96 $ 161.3 0.62%
Blue Chip Growth ((pound)) 7/31/96 7,778.6 0.67
Low-Priced Stock ((pound)) 7/31/96 3,539.3 0.77
OTC Portfolio ((pound)) 7/31/96 2,450.5 0.53
Export and Multinational Fund ((pound)) 8/31/96 345.0 0.61
Advisor Korea Fund, Inc. ((oval)) 9/30/96 53.7 1.00
Destiny I ((pound)) 9/30/96 4,319.1 0.62
Destiny II ((pound)) 9/30/96 2,293.1 0.73
Advisor Emerging Asia Fund, Inc. ((oval)) 10/31/96 131.8 1.02
Advisor Natural Resources ((pound))
Class A 10/31/96** 0.9 0.72
Class T 10/31/96 441.6 0.72
Class B 10/31/96 16.6 0.72
Institutional Class 10/31/96 6.2 0.72
Advisor Growth Opportunities: ((pound))
Class A 10/31/96** 4.2 0.61
Class T 10/31/96 12,224.7 0.61
Class B ((hollow diamond)) 10/31/97** 33.0 0.61
Institutional Class 10/31/96 193.0 0.61
Advisor Overseas: ((sigma))
Class A 10/31/96** 0.3 0.68
Class T 10/31/96 913.4 0.68
Class B 10/31/96 12.0 0.68
Institutional Class 10/31/96 6.6 0.68
Canada ((sigma)) 10/31/96 145.6 0.45
Capital Appreciation ((pound)) 10/31/96 1,656.1 0.54
Disciplined Equity ((pound)) 10/31/96 2,168.3 0.54
Diversified International ((sigma)) 10/31/96 478.6 0.85
Emerging Markets ((sigma)) 10/31/96 1,329.4 0.76
Europe ((sigma)) 10/31/96 558.5 0.84
Europe Capital Appreciation ((sigma)) 10/31/96 167.9 0.80
France ((sigma)) 10/31/96** 5.5 0.75(dagger)
Germany ((sigma)) 10/31/96** 5.5 0.75(dagger)
Hong Kong and China ((Rex-all)) 10/31/96** 58.8 0.75(dagger)
International Value ((Rex-all)) 10/31/96 217.4 0.79
Japan ((Rex-all)) 10/31/96 374.5 0.68
Japan Small Companies ((Rex-all)) 10/31/96** 105.3 0.75(dagger)
Latin America ((sigma)) 10/31/96 605.9 0.76
Nordic ((sigma)) 10/31/96** 9.6 0.75(dagger)
Overseas ((sigma)) 10/31/96 2,773.5 0.76
Pacific Basin ((Rex-all)) 10/31/96 605.8 0.75
Southeast Asia ((Rex-all)) 10/31/96 848.8 0.65
Stock Selector ((pound)) 10/31/96 1,447.9 0.58
Technoquant Growth 10/31/97** 51.3 0.61(dagger)
United Kingdom ((sigma)) 10/31/96** 2.1 0.75(dagger)
Value ((pound)) 10/31/96 6,357.2 0.65
Worldwide ((sigma)) 10/31/96 762.4 0.76
Advisor Equity Growth: ((pound))
Class A 11/30/96** $ 2.0 0.61%
Class T 11/30/96 2,784.5 0.61
Class B ((hollow diamond)) 11/30/97** 9.7 0.61
Institutional Class 11/30/96 1,022.8 0.61
Advisor Large Cap: ((pound))
Class A 11/30/96** 0.3 0.60(dagger)
Class T 11/30/96** 12.6 0.60(dagger)
Class B 11/30/96** 3.7 0.60(dagger)
Institutional Class 11/30/96** 4.9 0.60(dagger)
Advisor Mid Cap: ((pound))
Class A 11/30/96** 0.7 0.60(dagger)
Class T 11/30/96** 116.9 0.60(dagger)
Class B 11/30/96** 17.5 0.60(dagger)
Institutional Class 11/30/96** 2.5 0.60(dagger)
Advisor TechnoQuant Growth: ((pound))
Class A 11/30/97** 2.8 0.60(dagger)
Class T 11/30/97** 7.1 0.60(dagger)
Class B 11/30/97** 3.0 0.60(dagger)
Institutional Class 11/30/97** 1.0 0.60(dagger)
Emerging Growth ((pound)) 11/30/96 1,608.1 0.77
Growth Company ((pound)) 11/30/96 7,918.8 0.62
New Millennium ((pound)) 11/30/96 960.0 0.73
Retirement Growth ((pound)) 11/30/96 4,142.2 0.50
Advisor Strategic Opportunities: ((pound))
Class A 12/31/96** 0.4 0.48
Class T 12/31/96 603.6 0.48
Class B 12/31/96 99.5 0.48
Institutional Class 12/31/96 32.0 0.48
Initial Class 12/31/96 21.7 0.48
Congress Street 12/31/96 86.2 0.45
Contrafund ((pound)) 12/31/96 19,417.4 0.57
Exchange 12/31/96 246.2 0.54
Trend ((pound)) 12/31/96 1,293.3 0.42
Variable Insurance Products:
Growth ((pound)) 12/31/96 5,245.2 0.61
Overseas Portfolio ((sigma)) 12/31/96 1,544.2 0.76
Variable Insurance Products II:
Contrafund ((pound)) 12/31/96 1,576.1 0.61
Variable Insurance Products III:
Growth Opportunities ((pound)) 12/31/96 277.4 0.61
Overseas Fund ((sigma)) 12/31/96 33.3 0.70*
Select Portfolios:
Air Transportation ((pound)) 2/28/97 89.4 0.60
American Gold 2/28/97 414.0 0.60
Automotive ((pound)) 2/28/97 120.2 0.60
Biotechnology ((pound)) 2/28/97 715.3 0.60
Brokerage and Investment Management ((pound)) 2/28/97 72.5 0.62
Chemicals ((pound)) 2/28/97 123.5 0.60
Computers ((pound)) 2/28/97 546.6 0.61
Construction and Housing ((pound)) 2/28/97 68.0 0.60
Consumer Industries ((pound)) 2/28/97 25.6 0.60
Cyclical Industries ((pound)) 2/28/98** 1.7 0.60(dagger)
Select Portfolios (continued):
Defense and Aerospace ((pound)) 2/28/97 $ 44.1 0.61%
Developing Communications ((pound)) 2/28/97 307.6 0.60
Electronics ((pound)) 2/28/97 1,297.2 0.61
Energy ((pound)) 2/28/97 176.4 0.60
Energy Service ((pound)) 2/28/97 461.6 0.60
Environmental Services ((pound)) 2/28/97 41.6 0.61
Financial Services ((pound)) 2/28/97 273.8 0.61
Food and Agriculture ((pound)) 2/28/97 278.8 0.60
Health Care ((pound)) 2/28/97 1,266.7 0.60
Home Finance ((pound)) 2/28/97 691.6 0.61
Industrial Equipment ((pound)) 2/28/97 92.5 0.61
Industrial Materials ((pound)) 2/28/97 97.9 0.60
Insurance ((pound)) 2/28/97 33.8 0.61
Leisure ((pound)) 2/28/97 106.5 0.60
Medical Delivery ((pound)) 2/28/97 216.3 0.60
Multimedia ((pound)) 2/28/97 85.1 0.60
Natural Gas ((pound)) 2/28/97 113.0 0.60
Natural Resources ((pound)) 2/28/98** 2.6 0.60(dagger)
Paper and Forest Products ((pound)) 2/28/97 32.3 0.60
Precious Metals and Minerals ((pound)) 2/28/97 332.0 0.60
Regional Banks ((pound)) 2/28/97 416.8 0.61
Retailing ((pound)) 2/28/97 221.9 0.60
Software and Computer Services ((pound)) 2/28/97 421.4 0.60
Technology ((pound)) 2/28/97 463.1 0.60
Telecommunications ((pound)) 2/28/97 476.9 0.60
Transportation ((pound)) 2/28/97 12.6 0.41*
Utilities Growth ((pound)) 2/28/97 238.2 0.60
Magellan ((pound)) 3/31/97 54,132.7 0.45
Large Cap Stock ((pound)) 4/30/97 100.3 0.53
Mid Cap Stock ((pound)) 4/30/97 1,528.2 0.70
Small Cap Stock ((pound)) 4/30/97 548.6 0.55
Advisor Focus Funds:
Consumer: ((pound))
Class A 7/31/97** 0.7 0.61(dagger)
Class T 7/31/97** 3.1 0.61(dagger)
Class B 7/31/97** 0.2 0.61(dagger)
Institutional Class 7/31/97** 1.1 0.61(dagger)
Cyclical: ((pound))
Class A 7/31/97** 0.2 0.61(dagger)
Class T 7/31/97** 0.8 0.61(dagger)
Class B 7/31/97** 0.1 0.61(dagger)
Institutional Class 7/31/97** 5.1 0.61(dagger)
Financial Services: ((pound))
Class A 7/31/97** 2.1 0.61(dagger)
Class T 7/31/97** 15.1 0.61(dagger)
Class B 7/31/97** 1.6 0.61(dagger)
Institutional Class 7/31/97** 1.7 0.61(dagger)
Health Care: ((pound))
Class A 7/31/97** 2.2 0.61(dagger)
Class T 7/31/97** 15.7 0.61(dagger)
Class B 7/31/97** 1.1 0.61(dagger)
Institutional Class 7/31/97** 1.7 0.61(dagger)
Advisor Focus Funds (continued):
Technology: ((pound))
Class A 7/31/97** $ 2.7 0.61(dagger)%
Class T 7/31/97** 17.7 0.61(dagger)
Class B 7/31/97** 0.7 0.61(dagger)
Institutional Class 7/31/97** 1.2 0.61(dagger)
Utilities Growth: ((pound))
Class A 7/31/97** 0.3 0.61(dagger)
Class T 7/31/97** 2.8 0.61(dagger)
Class B 7/31/97** 0.3 0.61(dagger)
Institutional Class 7/31/97** 1.6 0.61(dagger)
</TABLE>
(a) All fund data are as of the fiscal year end noted in the chart or as of
April 30, 1997, 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 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 (*).
(dagger) Annualized
** Less than a complete fiscal year
((Rex-all)) Fidelity Management & Research Company 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 (FIIAL U.K.), with respect to the fund.
((sigma)) Fidelity Management & Research Company has entered into
sub-advisory agreements with the following affiliates: FMR U.K., FMR Far
East, FIIA, and FIIAL U.K., with respect to the fund.
((pound)) Fidelity Management & Research Company has entered into
sub-advisory agreements with FMR U.K. and FMR Far East, with respect to the
fund.
((oval)) Fidelity Management & Research Company has entered into
sub-advisory agreements with FIIA and FIJ, with respect to the fund.
((hollow diamond)) The ratio of net advisory fees to average net assets
paid to FMR represents the amount as of the prior fiscal year end. Updated
ratios will be presented for each class of shares of the fund when the next
fiscal year end figures are available.
IT1-pxs-0797 CUSIP#315910802/FUND#325
CUSIP#315910828/FUND#341
CUSIP#315910794/FUND#345
CUSIP#315910786/FUND#346
CUSIP#315910778/FUND#352
CUSIP#315910760/FUND#360
CUSIP#315910844/FUND#349
CUSIP#315910752/FUND#342
CUSIP#315910745/FUND#344
CUSIP#315910810/FUND#335
CUSIP#315910885/FUND#350
CUSIP#315910851/FUND#351
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY DIVERSIFIED INTERNATIONAL FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity Diversified International 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 September 17, 1997 at 9:45 a.m. and at any
adjournments thereof. All powers may be exercised by a majority of said
proxy holders or substitutes voting or acting or, if only one votes and
acts, then by that one. This Proxy shall be voted on the proposals
described in the Proxy Statement as specified on the reverse side. Receipt
of the Notice of the Meeting and the accompanying Proxy Statement is hereby
acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910802/325
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment company .
6. To adopt a new fundamental investment policy for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 6.
f und , permitting the fund to invest all of its assets in
another open-end investment company with
substantially the same investment objective and
policies.
7. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 7.
f und.
14. To approve a new Sub-Advisory Agreement with FOR [ ] AGAINST [ ] ABSTAIN [ ] 14.
Fidelity Investments Japan L imited for the f und.
15. To approve a Distribution and Service Plan pursuant to FOR [ ] AGAINST [ ] ABSTAIN [ ] 15.
Rule 12b-1 for the f und.
16. To amend the f und's fundamental investment FOR [ ] AGAINST [ ] ABSTAIN [ ] 16.
limitation concerning diversification .
</TABLE>
DIF-PXC-0797 cusip # 315910802/fund# 325
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY EUROPE CAPITAL APPRECIATION FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity Europe Capital Appreciation 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 September 17, 1997 at 9:45 a.m. and at any
adjournments thereof. All powers may be exercised by a majority of said
proxy holders or substitutes voting or acting or, if only one votes and
acts, then by that one. This Proxy shall be voted on the proposals
described in the Proxy Statement as specified on the reverse side. Receipt
of the Notice of the Meeting and the accompanying Proxy Statement is hereby
acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910828/341
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment compa ny .
6. To adopt a new fundamental investment policy for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 6.
f und permitting the fund to invest all of its assets in
another open-end investment company with
substantially the same investment objective and
policies.
9. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 9.
f und.
16. To amend the f und's fundamental investment FOR [ ] AGAINST [ ] ABSTAIN [ ] 16.
limitation concerning diversification.
</TABLE>
ECA-PXC-0797 cusip # 315910828/fund# 341
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY FRANCE FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity France 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
September 17, 1997 at 9:45 a.m. and at any adjournments thereof. All
powers may be exercised by a majority of said proxy holders or substitutes
voting or acting or, if only one votes and acts, then by that one. This
Proxy shall be voted on the proposals described in the Proxy Statement as
specified on the reverse side. Receipt of the Notice of the Meeting and
the accompanying Proxy Statement is hereby acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910794/345
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment company .
13. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 13.
f und.
</TABLE>
FRA-PXC-0797 cusip # 315910794/fund# 345
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY GERMANY FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity Germany 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
September 17, 1997 at 9:45 a.m. and at any adjournments thereof. All
powers may be exercised by a majority of said proxy holders or substitutes
voting or acting or, if only one votes and acts, then by that one. This
Proxy shall be voted on the proposals described in the Proxy Statement as
specified on the reverse side. Receipt of the Notice of the Meeting and
the accompanying Proxy Statement is hereby acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910786/346
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment compan y .
13. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 13.
fund.
</TABLE>
GER-PXC-0797 cusip # 315910786/fund# 346
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY UNITED KINGDOM FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity United Kingdom 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 September 17, 1997 at 9:45 a.m. and at any
adjournments thereof. All powers may be exercised by a majority of said
proxy holders or substitutes voting or acting or, if only one votes and
acts, then by that one. This Proxy shall be voted on the proposals
described in the Proxy Statement as specified on the reverse side. Receipt
of the Notice of the Meeting and the accompanying Proxy Statement is hereby
acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910745/344
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment company .
13. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 13.
f und.
</TABLE>
UTY-PXC-0797 cusip # 315910745/fund# 344
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY HONG KONG AND CHINA FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity Hong Kong and China 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 September 17, 1997 at 9:45 a.m. and at any
adjournments thereof. All powers may be exercised by a majority of said
proxy holders or substitutes voting or acting or, if only one votes and
acts, then by that one. This Proxy shall be voted on the proposals
described in the Proxy Statement as specified on the reverse side. Receipt
of the Notice of the Meeting and the accompanying Proxy Statement is hereby
acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910778/352
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment company.
13. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 13.
f und.
</TABLE>
HKC-PXC-0797 cusip # 315910778/fund# 352
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY INTERNATIONAL VALUE FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity International Value 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 September 17, 1997 at 9:45 a.m. and at any
adjournments thereof. All powers may be exercised by a majority of said
proxy holders or substitutes voting or acting or, if only one votes and
acts, then by that one. This Proxy shall be voted on the proposals
described in the Proxy Statement as specified on the reverse side. Receipt
of the Notice of the Meeting and the accompanying Proxy Statement is hereby
acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910810/335
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment company.
8. To approve an amended management contract for t he FOR [ ] AGAINST [ ] ABSTAIN [ ] 8.
fund.
15. To approve a Distribution and Service Plan pursuant to FOR [ ] AGAINST [ ] ABSTAIN [ ] 15.
Rule 12b-1 for the f und.
16. To amend the f und's fundamental investment FOR [ ] AGAINST [ ] ABSTAIN [ ] 16.
limitation concerning diversification.
</TABLE>
IVF-PXC-0797 cusip # 315910810/fund# 335
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY JAPAN FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity Japan 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
September 17, 1997 at 9:45 a.m. and at any adjournments thereof. All
powers may be exercised by a majority of said proxy holders or substitutes
voting or acting or, if only one votes and acts, then by that one. This
Proxy shall be voted on the proposals described in the Proxy Statement as
specified on the reverse side. Receipt of the Notice of the Meeting and
the accompanying Proxy Statement is hereby acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910885/350
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment company.
6. To adopt a new fundamental investment policy for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 6.
f und permitting the fund to invest all of its assets in
another open-end investment company with
substantially the same investment objective and
policies.
10. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 10.
f und.
16. To amend the f und's fundamental investment FOR [ ] AGAINST [ ] ABSTAIN [ ] 16.
limitation concerning diversification.
</TABLE>
JPN-PXC-0797 cusip # 315910885/fund# 350
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY JAPAN SMALL COMPANIES FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity Japan Small Companies 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 September 17, 1997 at 9:45 a.m. and at any
adjournments thereof. All powers may be exercised by a majority of said
proxy holders or substitutes voting or acting or, if only one votes and
acts, then by that one. This Proxy shall be voted on the proposals
described in the Proxy Statement as specified on the reverse side. Receipt
of the Notice of the Meeting and the accompanying Proxy Statement is hereby
acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910760/360
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment compa n y.
13. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 13.
f und.
</TABLE>
JSC-PXC-0797 cusip # 315910760/fund# 360
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY LATIN AMERICA FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity Latin America 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 September 17, 1997 at 9:45 a.m. and at any
adjournments thereof. All powers may be exercised by a majority of said
proxy holders or substitutes voting or acting or, if only one votes and
acts, then by that one. This Proxy shall be voted on the proposals
described in the Proxy Statement as specified on the reverse side. Receipt
of the Notice of the Meeting and the accompanying Proxy Statement is hereby
acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910844/349
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment company.
6. To adopt a new fundamental investment policy for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 6.
f und permitting the fund to invest all of its assets in
another open-end investment company with
substantially the same investment objective and
policies.
12. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 12.
f und.
16. To amend the f und's fundamental investment FOR [ ] AGAINST [ ] ABSTAIN [ ] 16.
limitation concerning diversification.
</TABLE>
LAF-PXC-0797 cusip # 315910844/fund# 349
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY NORDIC FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity Nordic 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
September 17, 1997 at 9:45 a.m. and at any adjournments thereof. All
powers may be exercised by a majority of said proxy holders or substitutes
voting or acting or, if only one votes and acts, then by that one. This
Proxy shall be voted on the proposals described in the Proxy Statement as
specified on the reverse side. Receipt of the Notice of the Meeting and
the accompanying Proxy Statement is hereby acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910752/342
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment company.
13. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 13.
f und.
</TABLE>
NOR-PXC-0797 cusip # 315910752/fund# 342
Vote this proxy card TODAY! Your prompt response will
save your fund 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 INVESTMENT TRUST: FIDELITY SOUTHEAST ASIA FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur S. Loring, and Donald J. Kirk, or any one or more of
them, attorneys, with full power of substitution, to vote all shares of
Fidelity Investment Trust: Fidelity Southeast Asia 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 September 17, 1997 at 9:45 a.m. and at any
adjournments thereof. All powers may be exercised by a majority of said
proxy holders or substitutes voting or acting or, if only one votes and
acts, then by that one. This Proxy shall be voted on the proposals
described in the Proxy Statement as specified on the reverse side. Receipt
of the Notice of the Meeting and the accompanying Proxy Statement is hereby
acknowledged.
NOTE: Please sign exactly as your name appears on this Proxy. When signing
in a fiduciary capacity, such as executor, administrator, trustee,
attorney, guardian, etc., please so indicate. Corporate and partnership
proxies should be signed by an authorized person indicating the person's
title.
Date _____________, 1997
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
315910851/351
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:
- --------------------------------------------------------------------------
- --------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To elect the 12 nominees specified below as [ ] FOR all nominees [ ] 1.
Trustees: Ralph F. Cox, Phyllis Burke Davis, Robert listed (except as WITHHOLD
M. Gates, Edward C. Johnson 3d, E. Bradley Jones, marked to the contrary authority to
Donald J. Kirk, Peter S. Lynch, William O. McCoy, below). vote for all
Gerald C. McDonough, Marvin L. Mann, Robert C. nominees.
Pozen and Thomas R. Williams. (INSTRUCTION: TO
WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S), WRITE THE NAME(S) OF THE NOMINEE(S)
ON THE LINE BELOW.)
</TABLE>
__________________________________________________________________________
___________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
2. To ratify the selection of Coopers & Lybrand L.L.P. FOR [ ] AGAINST [ ] ABSTAIN [ ] 2.
and Price Waterhouse LLP as independent
accountants of the trust.
3. To amend the Declaration of Trust to provide FOR [ ] AGAINST [ ] ABSTAIN [ ] 3.
dollar-based voting rights for shareholders of the trust.
4. To amend the Declaration of Trust regarding FOR [ ] AGAINST [ ] ABSTAIN [ ] 4.
shareholder notification of appointment of Trustees.
5. To amend the Declaration of Trust to provide each FOR [ ] AGAINST [ ] ABSTAIN [ ] 5.
fund with the ability to invest all of its assets in another
open-end investment company.
6. To adopt a new fundamental investment policy for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 6.
f und permitting the fund to invest all of its assets in
another open-end investment company with
substantially the same investment objective and
policies.
11. To approve an amended management contract for the FOR [ ] AGAINST [ ] ABSTAIN [ ] 11.
f und.
16. To amend the f und's fundamental investment FOR [ ] AGAINST [ ] ABSTAIN [ ] 16.
limitation concerning diversification.
</TABLE>
SEA-PXC-0797 cusip # 315910851/fund# 351
IMPORTANT
PROXY MATERIALS
PLEASE CAST YOUR VOTE NOW!
FIDELITY DIVERSIFIED INTERNATIONAL FUND
FIDELITY EUROPE CAPITAL APPRECIATION FUND
FIDELITY FRANCE FUND
FIDELITY GERMANY FUND
FIDELITY HONG KONG AND CHINA FUND
FIDELITY INTERNATIONAL VALUE FUND
FIDELITY JAPAN FUND
FIDELITY JAPAN SMALL COMPANIES FUND
FIDELITY LATIN AMERICA FUND
FIDELITY NORDIC FUND
FIDELITY SOUTHEAST ASIA FUND
FIDELITY UNITED KINGDOM FUND
Dear Shareholder:
I am writing to let you know that a special shareholder meeting will be
held in September to vote on several important proposals that affect the
funds listed above and your investment in them. As a shareholder, you have
the opportunity to voice your opinion on the matters that affect your
funds. This package contains information about the proposals and the
materials to use when voting by mail.
Please read the enclosed materials and cast your vote on the proxy card(s).
PLEASE VOTE AND RETURN YOUR CARD(S) PROMPTLY. YOUR VOTE IS EXTREMELY
IMPORTANT, NO MATTER HOW LARGE OR SMALL YOUR HOLDINGS MAY BE.
All of the proposals have been carefully reviewed by the Board of Trustees.
The Trustees, most of whom are not affiliated with Fidelity, are
responsible for protecting your interests as a shareholder. The Trustees
believe these proposals are in the best interest of shareholders. They
recommend that you vote for each proposal.
The following Q&A is provided to assist you in understanding the proposals.
Each of these proposals is described in greater detail in the enclosed
proxy statement.
VOTING BY MAIL IS QUICK AND EASY. EVERYTHING YOU NEED IS ENCLOSED. We
encourage you to exercise your right as a shareholder and to vote promptly.
To cast your vote, simply complete the proxy card(s) enclosed in this
package. Be sure to sign the card before mailing it in the postage-paid
envelope.
If you have any questions before you vote, please call us at
1-800-544-8888. We'll be glad to help you get your vote in quickly. Thank
you for your participation in this important initiative.
Sincerely,
Edward C. Johnson 3d
President
IMPORTANT INFORMATION TO HELP YOU UNDERSTAND AND VOTE ON THE PROPOSALS
Please read the full text of the enclosed proxy statement. Below is a
brief overview of all of the proposals found in the proxy statement that
are to be voted on at the special shareholder meeting. Some of the
proposals described in this overview may not apply to your fund. If you
have any questions regarding the proposals, please call us at
1-800-544-8888. We appreciate you placing your trust in Fidelity and look
forward to helping you achieve your financial goals.
THE PROXY SAYS THAT THE BOARD OF TRUSTEES HAS APPROVED THESE CHANGES. WHAT
ROLE DOES THE BOARD PLAY? (PROPOSAL 1)
The Trustees oversee the investment policies of each fund. Members of the
Board are fiduciaries and have an obligation to serve the best interests of
each fund's shareholders, including approving policy changes such as those
proposed for your fund. In addition, the Trustees review fund performance,
oversee a fund's activities, and review contractual arrangements with
companies that provide services to a fund.
WHAT IS THE ROLE OF THE INDEPENDENT ACCOUNTANTS? (PROPOSAL 2)
The independent accountants examine annual financial statements for each
fund and provide other audit and tax-related services. They also sign or
certify any financial statements of the trust that are required by law to
be independently certified and filed with the Securities and Exchange
Commission (SEC).
WHAT IS THE CHANGE IN VOTING RIGHTS BEING PROPOSED? (PROPOSAL 3)
The proposed change would provide a more equitable distribution of voting
rights than the one-share, one-vote system currently in effect. The voting
power of each shareholder would be measured by the value of the
shareholder's total dollar investment rather than by the number of shares
owned.
This proposal provides fairer voting rights on trust-wide matters such as
the election of trustees. There would be no impact on fund-specific
proposals such as changing an investment policy of a fund.
Here is an example of why this change is being recommended. Investor A
makes a $1,000 investment in a fund with a $1.00 share price and receives
1,000 shares. Investor B in the same trust makes a $1,000 investment in
another fund with a $10.00 share price and receives only 100 shares. Under
the current system, Investor A would have a much greater vote than Investor
B. The proposed change would give both investors the same voting rights
since they both made a $1,000 investment.
WHAT IS THE PROPOSED CHANGE IN NOTIFICATION OF AN APPOINTMENT OF A TRUSTEE?
(PROPOSAL 4)
The Declaration of Trust currently requires that notification of a Trustee
appointment be mailed to shareholders within three months. To reduce the
cost to the funds, the proposed change is to notify shareholders of Trustee
appointments in the next financial report for each fund.
WHAT ARE THE BENEFITS OF PERMITTING FUNDS TO INVEST THEIR ASSETS IN ANOTHER
OPEN-END INVESTMENT COMPANY WITH SUBSTANTIALLY THE SAME INVESTMENT
OBJECTIVE AND POLICIES? (PROPOSALS 5 AND 6)
Fidelity Management & Research Company (FMR) and the Board of Trustees
continually review methods of structuring mutual funds to take maximum
advantage of potential efficiencies. A number of mutual fund companies
have developed "master-feeder" fund structures under which several "feeder"
funds invest all of their assets in a single pooled investment, or "master"
fund. The benefit of the master feeder fund structure is that different
funds with substantially the same investment objective but different
servicing and distribution features may combine their investments and
achieve operational efficiencies in one master fund. An example would be
funds with the same investment objective but different minimum investments
due to the servicing of individual shareholders versus institutional
clients.
These proposals would enable a fund to invest all of its assets in another
open-end investment company, managed by FMR or an affiliate, with
substantially the same investment policies. No such plans are being
contemplated for the funds at this time and the Trustees would only allow
it in the future if they determined that it would be in the best interests
of a fund and its shareholders.
WHAT IS BEING AMENDED IN THE FUNDS' MANAGEMENT CONTRACTS?
(PROPOSALS 7 - 13)
The proposed amendments modify each fund's management contract with FMR.
One modification to each fund would reduce the Group Fee portion of the
management fee paid by the fund when FMR's assets under management exceed
certain levels. The result of this modification would be a Group Fee Rate
that is the same as, or lower than, the fee payable under the present
management contract.
For the Fidelity Diversified International Fund, Fidelity International
Value Fund, Fidelity Europe Capital Appreciation Fund, Fidelity Japan Fund,
and Fidelity Southeast Asia Fund, another proposed amendment would modify
each fund's performance adjustment calculation that is used to calculate
the fund's investment performance and that of its comparative Index.
Specifically, the calculation will be rounded to the nearest 0.01% rather
than the nearest 1.00% and the rounding will occur prior to comparison.
The rounding modification may increase or decrease the performance
adjustment. The combined effect of the modifications to the Group Fee and
rounding calculations may represent an increase or decrease from the
management fee under the present contract.
WHAT IS THE BENEFIT OF APPROVING A SUB-ADVISORY AGREEMENT WITH FIDELITY
INVESTMENTS JAPAN LIMITED (FIJ)? (PROPOSAL 14)
FIJ, with its principal office in Tokyo, Japan, provides FMR with
investment advice and research on foreign securities. This research
complements other research produced by FMR's U.S.-based research analysts
and portfolio managers.
Under the proposed agreement, FIJ could act as investment consultant to FMR
and supply FMR with investment research information and portfolio
management advice. FMR could also grant investment management authority to
FIJ if FMR believes it would be beneficial to the fund and its
shareholders. Of course, if FIJ were to exercise investment management
authority, it must adhere to the fund's investment policies, objectives and
limitations as specified in the prospectus. In addition, FIJ would have
the ability to execute portfolio transactions for FMR from points in the
Far East that are physically closer to foreign issuers.
The sub-advisory agreement on behalf of a fund would provide FMR with
increased flexibility to access more specialized investment expertise in
foreign markets. The proposed agreement would not increase fees paid to
FMR by the fund.
WHAT IS THE REASON FOR APPROVING "A DISTRIBUTION AND SERVICE PLAN PURSUANT
TO RULE 12B-1"? (PROPOSAL 15)
Under the Investment Company Act of 1940, Rule 12b-1 (the Rule) relates to
investment companies (e.g., a mutual fund) and the distribution of shares.
The Rule requires an investment company to have a written Plan "describing
all material aspects of the proposed financing of distribution." The
proposed Plan is designed to avoid legal uncertainties which may arise from
ambiguous phrasing in the Rule.
WHAT IS THE BENEFIT OF AMENDING THE FUNDAMENTAL INVESTMENT LIMITATION
CONCERNING DIVERSIFICATION? (PROPOSAL 16)
This proposal would permit each fund to invest without limit in the
securities of other investment companies. As a result of an order of
exemption granted by the SEC, the funds may currently invest up to 25% of
their total assets in non-publicly offered money market or short term bond
funds (the Central Funds), managed by FMR or an affiliate of FMR. The
primary benefit resulting from the Central Funds is enhanced efficiency of
cash management by providing increased short-term investment opportunities.
HOW MANY VOTES AM I ENTITLED TO CAST?
As a shareholder, you are entitled to one vote for each share you own of a
fund on the record date. The record date is July 21, 1997.
WHAT IF THERE ARE NOT ENOUGH VOTES TO REACH A QUORUM BY THE SCHEDULED
SHAREHOLDER MEETING DATE?
If enough people do not vote, we will need to take further action. We or
outside solicitors may contact you by mail, telephone, facsimile, or by
personal interview to encourage you to vote. All of this is costly to the
funds and is ultimately passed on to all shareholders. Therefore, we
encourage shareholders to vote as soon as they review the enclosed proxy
materials to avoid additional mailings, telephone calls or other
solicitations.
HOW DO I VOTE MY SHARES?
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
assistance, or have any questions regarding the proposals, please call us
at 1-800-544-8888.
HOW DO I SIGN THE PROXY CARD?
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."
