SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
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FIDELITY DIVERSIFIED INTERNATIONAL FUND
A FUND OF
FIDELITY INVESTMENT TRUST
82 DEVONSHIRE STREET, BOSTON, MASSACHUSETTS 02109
1-800-544-8888
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that a Special Meeting of Shareholders (the
Meeting) of Fidelity Diversified International Fund (the fund) will be
held at the office of Fidelity Investment Trust (the trust), 82
Devonshire Street, Boston, Massachusetts 02109 on July 14 ,
1999, at 10:00 a.m. The purpose of the Meeting is to consider
and act upon the following proposal, and to transact such other
business as may properly come before the Meeting or any adjournments
thereof.
1. To approve an amended management contract for the fund.
The Board of Trustees has fixed the close of business on May
24 , 1999 as the record date for the determination of the
shareholders of the fund entitled to notice of, and to vote at, such
Meeting and any adjournments thereof.
By order of the Board of Trustees,
ERIC D. ROITER, Secretary
May 24 , 1999
YOUR VOTE IS IMPORTANT -
PLEASE RETURN YOUR PROXY CARD PROMPTLY.
SHAREHOLDERS ARE INVITED TO ATTEND THE MEETING IN PERSON. ANY
SHAREHOLDER WHO DOES NOT EXPECT TO ATTEND THE MEETING IS URGED TO
INDICATE VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD, DATE AND SIGN
IT, AND RETURN IT IN THE ENVELOPE PROVIDED, WHICH NEEDS NO POSTAGE IF
MAILED IN THE UNITED STATES. IN ORDER TO AVOID UNNECESSARY EXPENSE, WE
ASK YOUR COOPERATION IN MAILING YOUR PROXY CARD PROMPTLY, NO MATTER
HOW LARGE OR SMALL YOUR HOLDINGS MAY BE.
INSTRUCTIONS FOR EXECUTING PROXY CARD
The following general rules for executing proxy cards may be of
assistance to you and help avoid the time and expense involved in
validating your vote if you fail to execute your proxy card properly.
1. INDIVIDUAL ACCOUNTS: Your name should be signed exactly as it
appears in the registration on the proxy card.
2. JOINT ACCOUNTS: Either party may sign, but the name of the party
signing should conform exactly to a name shown in the registration.
3. ALL OTHER ACCOUNTS should show the capacity of the individual
signing. This can be shown either in the form of the account
registration itself or by the individual executing the proxy card. For
example:
REGISTRATION VALID SIGNATURE
A. 1) ABC Corp. John Smith, Treasurer
2) ABC Corp. John Smith, Treasurer
c/o John Smith, Treasurer
B. 1) ABC Corp. Profit Sharing Plan Ann B. Collins, Trustee
2) ABC Trust Ann B. Collins, Trustee
3) Ann B. Collins, Trustee u/t/d Ann B. Collins, Trustee
12/28/78
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
TO BE HELD ON JULY 14 , 1999
This Proxy Statement is furnished in connection with a solicitation
of proxies made by, and on behalf of, the Board of Trustees of
Fidelity Investment Trust (the trust) to be used at the Special
Meeting of Shareholders of Fidelity Diversified International Fund
(the fund) and at any adjournments thereof (the Meeting), to be held
on July 14 , 1999 at 1 0 :00 a.m. at 82 Devonshire Street,
Boston, Massachusetts 02109, the principal executive office of the
trust and Fidelity Management & Research Company (FMR), the
fund' s investment adviser.
The purpose of the Meeting is set forth in the accompanying Notice.
The solicitation is being made primarily by the mailing of this Proxy
Statement and the accompanying proxy card on or about May 24 ,
1999. Supplementary solicitations may be made by mail, telephone,
telegraph, facsimile, electronic means or by personal interview by
representatives of the trust. In addition, Management Information
Services Corp. (MIS) and D.F. King & Co., Inc. may be paid on a
per-call basis to solicit shareholders on behalf of the fund at an
anticipated cost of approximately $5,000 . The expenses in
connection with preparing this Proxy Statement and its enclosures and
of all solicitations will be paid by the fund. The fund will reimburse
brokerage firms and others for their reasonable expenses in forwarding
solicitation material to the beneficial owners of shares. The
principal business address of Fidelity Distributors Corporation (FDC),
the fund' s principal underwriter and distribution agent, and
Fidelity Management & Research (U.K.) Inc. (FMR U.K.) and Fidelity
Management & Research (Far East) Inc. (FMR Far East), subadvisers to
the fund, is 82 Devonshire Street, Boston, Massachusetts 02109.
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 fund.
If the enclosed proxy card is executed and returned, it may
nevertheless be revoked at any time prior to its use by written
notification received by the trust, by the execution of a later-dated
proxy card, by the trust's receipt of a subsequent valid telephonic
vote or by attending the Meeting and voting in person.
All proxy cards solicited by the Board of Trustees that are properly
executed and received by the Secretary prior to the Meeting, and are
not revoked, will be voted at the Meeting. Shares represented by such
proxies will be voted in accordance with the instructions thereon. If
no specification is made on a proxy card, it will be voted FOR the
matters specified on the proxy card. Only proxies that are voted will
be counted towards establishing a quorum. Broker non-votes are not
considered voted for this purpose. Shareholders should note that while
votes to ABSTAIN will count toward establishing a quorum, passage of
any proposal being considered at the Meeting will occur only if a
sufficient number of votes are cast FOR the proposal. Accordingly,
votes to ABSTAIN and votes AGAINST will have the same effect in
determining whether a proposal is approved.
The fund may also arrange to have votes recorded by telephone. The
expenses in connection with telephone voting will be paid by the fund.
If the fund record s votes by telephone, it 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 at the meeting in the same manner that
proxies voted by mail may be revoked. D.F. King & Co., Inc. may
be paid on a per-call basis for vote-by-phone solicitations on
behalf of the fund at an anticipated cost of approximately
$ 7 ,000.
If a quorum is not present at the Meeting, or if a quorum is present
at the Meeting but sufficient votes to approve one or more of the
proposed items are not received, or if other matters arise requiring
shareholder attention, the persons named as proxy agents may propose
one or more adjournments of the Meeting to permit further solicitation
of proxies. Any such adjournment will require the affirmative vote of
a majority of those shares present at the Meeting or represented by
proxy. When voting on a proposed adjournment, the persons named as
proxy agents will vote FOR the proposed adjournment all shares that
they are entitled to vote with respect to each item, unless directed
to vote AGAINST the item, in which case such shares will be voted
AGAINST the proposed adjournment with respect to that item. A
shareholder vote may be taken on the item in this Proxy Statement
prior to such adjournment if sufficient votes have been received and
it is otherwise appropriate.
As of March 31, 1999, there were 127,970,626 shares of the fund
issued and outstanding.
As of March 31 , 1999 the trustees and officers of the
trust owned, in the aggregate, less than 1% of the fund's outstanding
shares.
Shareholders of record at the close of business on May 24 ,
1999 will be entitled to vote at the Meeting. Each such shareholder
will be entitled to one vote for each dollar of net asset value held
on that date.
FOR A FREE COPY OF THE FUND'S ANNUAL REPORT FOR THE FISCAL
YEAR ENDED OCTOBER 31, 1998, CALL 1-800-544-8888 OR WRITE TO FIDELITY
DISTRIBUTORS CORPORATION AT 82 DEVONSHIRE STREET, BOSTON,
MASSACHUSETTS 02109.
VOTE REQUIRED: APPROVAL OF THE PROPOSAL REQUIRES THE
AFFIRMATIVE VOTE OF A "MAJORITY OF THE OUTSTANDING VOTING SECURITIES"
OF THE FUND. UNDER THE INVESTMENT COMPANY ACT OF 1940 (THE 1940 ACT),
THE VOTE OF A "MAJORITY OF THE OUTSTANDING VOTING SECURITIES" MEANS
THE AFFIRMATIVE VOTE OF THE LESSER OF (A) 67% OR MORE OF THE VOTING
SECURITIES PRESENT AT THE MEETING OR REPRESENTED BY PROXY IF THE
HOLDERS OF MORE THAN 50% OF THE OUTSTANDING VOTING SECURITIES ARE
PRESENT OR REPRESENTED BY PROXY OR (B) MORE THAN 50% OF THE
OUTSTANDING VOTING SECURITIES. BROKER NON-VOTES ARE NOT CONSIDERED
"PRESENT" FOR THIS PURPOSE.
1. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR THE FUND.
The Board of Trustees, including the Trustees who are not "interested
persons" of the Trust or of FMR (the Independent Trustees), has
approved, and recommends that shareholders of the fund approve, a
proposal to adopt an amended management contract with FMR (the Amended
Contract) in the form attached to this Proxy Statement as Exhibit 1.
The Amended Contract modifies the management fee that FMR receives
from the fund for managing its investments and business affairs and
one other provision of the fund's existing management contract with
FMR (the Present Contract).
CURRENT MANAGEMENT FEE. The fund's current 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, 1998 (not including the fee amendment
discussed below) was 0.7 385 %.
The Performance Adjustment is a positive or negative dollar amount
applied to the Basic Fee and is based on the fund's performance and
assets for the most recent 36 months. If the fund outperforms its
current comparative index, the Morgan Stanley Capital International
Europe, Australasia, and Far East Index (GDP-weighted) (the Current
Index), over 36 months, FMR receives a positive Performance
Adjustment, which increases the management fee. If the fund
underperforms the Current Index, FMR's 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 rate of 0.20% if the fund outperforms or underperforms the
Current Index by ten percentage points or more over the performance
period. Under the Present Contract, FMR received a positive
Performance Adjustment for the fund's fiscal year ended October 31,
1998, which equaled 0.09 63 % of the fund's average net assets
for the year.
PROPOSED MANAGEMENT CONTRACT AMENDMENT. The Amended Contract would
(1) PROSPECTIVELY change the index used to calculate the fund's
Performance Adjustment from the Current Index to the Morgan Stanley
Capital International Europe, Australasia, and Far East Index
(Capitalization-weighted) (the Proposed Index) and (2) allow FMR and
the trust, on behalf of the fund, to modify the Management Contract
subject to the requirements of the 1940 Act (the Present Contract
currently requires the vote of a majority of the fund's outstanding
voting securities to authorize all amendments). See "Modification of
Management Contract Amendment Provisions" on page 10 for more details.
The Proposed Index represents an alternative measure of the
performance of the same 20 foreign stock markets covered by the
Current Index. Approval of the proposal will not affect the
f und's investment policies which permit FMR to use a variety of
strategies in managing the f und. However, it will change the
benchmark used to determine a portion of FMR's management fee.
IMPACT OF PROPOSED CHANGE IN PERFORMANCE ADJUSTMENT. The impact of
the proposed index change will depend on the fund's future performance
relative to the Proposed Index. The Proposed Index historically has
underperformed relative to the Current Index. However, because it is
impossible to predict the performance of the Proposed Index in the
future, it is not possible to know whether the index change will
increase or decrease the fund's management fee. Under the terms of
the Amended Contract, the proposed change in the fund's Performance
Adjustment index will actually occur on a gradual basis over the
36-month period after shareholder approval of the Amended Contract.
See "Implementation of Change in Performance Adjustment Index" on page
9 for details.
During the fund's fiscal year ended October 31, 1998, the index
change would have had no effect on management fees if it had been
implemented because FMR would have been entitled to the maximum
performance adjustment relative to both indexes during that period.
PRESENT AND AMENDED CONTRACTS. FMR is the fund's investment adviser
pursuant to a management contract dated October 1, 1997, which was
approved by shareholders on September 17, 1997. (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 16. Except for
the modifications discussed in this proposal, the Amended Contract is
substantially the same as the fund's Present Contract with FMR. (For a
detailed discussion of the fund's Present Contract, refer to the
section entitled "Present Management Contract" 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, 2000, 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 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, 1999 , and thereafter only as long as its
continuance is approved at least annually as described above.
COMPARISON OF PROPOSED AND CURRENT PERFORMANCE ADJUSTMENT INDICES. If
the proposal is approved, the fund will change its Performance
Adjustment index prospectively to the Proposed Index, the
Capitalization-weighted Morgan Stanley Capital International Europe,
Australasia, and Far East Index (Capitalization-weighted EAFE). The
EAFE index is designed to measure the performance of developed
international stock markets outside the U.S. and Canada. The index is
based on individual Morgan Stanley Capital International
single-country indexes for the 20 countries that comprise EAFE.
The Current and Proposed Indexes differ only in how they weight
the underlying single-country indexes. The Current Index , the
GDP-weighted EAFE , weights the performance of the country
indexes according to the size of each country's economy; the Proposed
Index, the Capitalization-weighted EAFE, weights the country indexes
according to the size of each country's stock market.
As illustrated by the chart below, the weighting differences can
result in different returns.
Comparison of Current and Proposed Performance Adjustment Indexes
Calendar Year Total Returns
(large solid box) Current GDP-WTD
EAFE) Index
(LARGE SOLID BOX) Proposed
(Cap-WTD)
Index
Percentage (%)
Row: 1, Col: 1, Value: nil
Row: 1, Col: 2, Value: nil
Row: 2, Col: 1, Value: nil
Row: 2, Col: 2, Value: nil
Row: 3, Col: 1, Value: nil
Row: 3, Col: 2, Value: nil
Row: 4, Col: 1, Value: nil
Row: 4, Col: 2, Value: nil
Row: 5, Col: 1, Value: -9.65
Row: 5, Col: 2, Value: -12.17
Row: 6, Col: 1, Value: 33.56
Row: 6, Col: 2, Value: 32.56
Row: 7, Col: 1, Value: 7.81
Row: 7, Col: 2, Value: 7.78
Row: 8, Col: 1, Value: 11.16
Row: 8, Col: 2, Value: 11.21
Row: 9, Col: 1, Value: 7.63
Row: 9, Col: 2, Value: 6.05
Row: 10, Col: 1, Value: 6.06
Row: 10, Col: 2, Value: 2.01
Row: 11, Col: 1, Value: 27.02
Row: 11, Col: 2, Value: 20.27
1992 1993 1994 1995 1996 1997 1998
The most significant difference between the Current Index and the
Proposed Index since the fund started in December 1991 has been the
relative weighting of Japan. In 1991, the Japanese market accounted
for 28% of the GDP-weighted EAFE and more than 50% of the
Capitalization-weighted EAFE. As of the most recent re-balancing (June
1998) of GDP-weighted EAFE, Japan represented 31% of the GDP-weighted
EAFE and 21% of the Capitalization-weighted EAFE. The
significant decline of Japan's weighting in the
Capitalization-weighted EAFE is the result of the fall in Japan's
stock market relative to the markets of other EAFE constituent
countries. Japan's weighting in the Capitalization-weighted
EAFE is now lower than the GDP-weighted EAFE .
Although both the Current Index and the Proposed Index are
well-recognized measures of the performance of developed international
markets, the Capitalization-weighted EAFE is used more
frequently as a performance benchmark for mutual funds. For this
reason, FMR proposes changing the benchmark to align the Fund's
benchmark with that of other broadly diversified
international funds in its competitive universe.
The financial impact of the proposed changes to the management fee is
summarized briefly in the following paragraphs. The changes are
discussed in more detail in the remainder of the proposal.
IMPLEMENTATION OF CHANGE IN PERFORMANCE ADJUSTMENT INDEX. If the
proposal is approved, the change in the fund's Performance Adjustment
index will be implemented on a prospective basis beginning with the
first day of the month following shareholder approval. However,
because the Performance Adjustment is based on a rolling 36-month
measurement period, comparisons to the Proposed Index will not be
fully implemented for 36 months after shareholder approval. During
this transition period, the fund's returns will be compared to a 36
month blended index return that reflects the performance of the
Proposed Index for the portion of the performance period subsequent to
its adoption and the performance of the Current Index for the
remainder of the period. For example, the Performance Adjustment for
the first full month following shareholder approval would be
calculated by comparing the fund's performance over the 36-month
performance period to a blended index return calculated using the
Current Index's performance for the first 35 months of the performance
period and the Proposed Index's performance for the 36th month. Each
month for the following 35 months, the blended index return would
reflect an additional month of the Proposed Index's performance and
one less month of the Current Index's performance. At the conclusion
of the transition period, the performance of the Current Index would
be eliminated from the Performance Adjustment calculation, and the
calculation would include only the performance of the Proposed Index.
COMPARISON OF MANAGEMENT FEES. The following table compares the
fund's management fee for the fiscal year ended October 31, 1998,
under the terms of the Present Contract to the management fee the fund
would have incurred if the proposed change in Performance Adjustment
index had been in effect. For this purpose, the Performance Adjustment
amounts presented for the Amended Contract for fiscal 1998 have been
calculated using the rolling 36-month historical performance of the
Proposed Index during the period. 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 13,661,575 .7385 13,661,575 .7385 0 0
Performance Adjustment 1,780,998 .0963 1,780,998 .0963 0 0
Total Management Fee 15,442,573 .8348 15,442,573 .8348 0 0
</TABLE>
The following table compares the fund's management fee for the 12
months ended April 30, 1999, under the terms of the Present Contract
to the management fee the fund would have incurred if the proposed
change in Performance Adjustment index had been in effect. For this
purpose, the Performance Adjustment amounts presented for the Amended
Contract for the 12 months ended April 30, 1999 have been calculated
using the rolling 36-month historical performance of the Proposed
Index during the period. Management fees are expressed in dollars and
as percentages of the fund's average net assets for the period.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Present Contract Amended Contract Difference
$ % $ % $ %
Basic Fee 15,615,033 .7375 15,615,033 .7375 0 0
Performance Adjustment 2,287,997 .1081 2,339,270 .1105 51,273 .0024
Total Management Fee 17,903,030 .8456 17,954,303 .8480 51,273 .0024
</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, 1998 under the Present Contract and if the
proposed change in Performance Adjustment index had been in effect
during the same period. As with the table s above, the
Performance Adjustment incorporated in the management fee expense
listed for the Amended Contract has been calculated using the rolling
36-month historical performance of the Proposed Index during fiscal
1998.
The following figures are based on historical expenses adjusted to
reflect current fees of the fund and are calculated as a percentage of
the fund's average net assets.
COMPARATIVE EXPENSE TABLE
Annual Fund Operating Expenses (as a percentage of average net assets)
Present Contract Amended Contract
Management Fee 0.83% 0.83%
12b-1 Fee None None
Other Expenses 0.39% 0.39%
Total Fund Operating Expenses 1.22% 1.22%
A portion of the brokerage commissions that the fund pays is used to
reduce the fund's expenses. In addition, the fund has entered into
arrangements with its custodian and transfer agent whereby credits
realized as a result of uninvested cash balances are used to reduce
custodian and transfer agent expenses. Including these
reductions, the total fund operating expenses presented in the table
would have been 1.19% under both the Present Contract and the Amended
Contract.
EXAMPLE: The following illustrates the expenses on a $10,000
investment under the fees and expenses stated above, assuming (1) 5%
annual return and (2) redemption at the end of each time period.
1 Year 3 Years 5 Years 10 years
Present Contract $ 124 $ 387 $ 670 $ 1,477
Amended Contract $ 124 $ 387 $ 670 $ 1,477
The purpose of this example and the table is to assist investors in
understanding the various costs and expenses of investing in shares of
the fund. The example above should not be considered a representation
of past or future expenses of the fund. Actual expenses may vary from
year to year and may be higher or lower than those shown above.
MODIFICATION OF MANAGEMENT CONTRACT AMENDMENT PROVISIONS. The Amended
Contract allows FMR and the trust, on behalf of the fund, to amend the
Management Contract subject to the provisions of Section 15 of the
1940 Act, as modified or interpreted by the Securities and Exchange
Commission. In contrast, the Present Contract explicitly requires the
vote of a majority of the outstanding voting securities of the fund to
authorize all amendments. Generally, the proposed modification to the
Present Contract's amendment provisions will allow FMR and the trust,
on behalf of the fund, to amend the Management Contract without
shareholder vote IF THE 1940 ACT PERMITS THEM TO DO SO. For example,
under current interpretations of Section 15 of the 1940 Act, the
Amended Contract would give FMR and the trust the ability to amend the
Management Contract to immediately reflect a management fee decrease
without the delay of having to first conduct a proxy solicitation. In
short, the proposed modification gives FMR and the trust added
flexibility to amend the Management Contract subject to 1940 Act
constraints. Of course, any future amendments to the Management
Contract would continue to require the approval of the fund's Board of
Trustees.
MATTERS CONSIDERED BY THE BOARD. The mutual funds for which the
members of the Board of Trustees serve as Trustees are referred to
herein as the "Fidelity funds." The Board of Trustees meets eleven
times a year. The Board of Trustees, including the Independent
Trustees, believe that matters bearing on the appropriateness of the
fund's management fees are considered at most, if not all, of their
meetings. While the full Board of Trustees or the Independent
Trustees, as appropriate, act on all major matters, a significant
portion of the activities of the Board of Trustees (including certain
of those described herein) 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 November 19, 1998 and May 20, 1999 .
The Board of Trustees received materials relating to the Amended
Contract in advance of the meeting at which the Amended Contract was
considered, and had the opportunity to ask questions and request
further information in connection with such consideration.
INFORMATION RECEIVED BY THE INDEPENDENT TRUSTEES. In connection with
their meetings, the Trustees received materials that relate to the
Amended Contract. These materials included: (i) information on the
investment performance of the fund, a peer group of funds and an
appropriate index or combination of indices, (ii) sales and redemption
data in respect of the fund, and (iii) the economic outlook and
the general investment outlook in the markets in which the fund
invests. The Board of Trustees and the Independent Trustees also
consider periodically other material facts such as (1) FMR's results
and financial condition, (2) arrangements in respect of the
distribution of the fund's shares, (3) the procedures employed to
determine the value of the fund's assets, (4) the allocation of the
fund's brokerage, if any, including allocations to brokers affiliated
with FMR and the use of "soft" commission dollars to pay fund expenses
and to pay for research and other similar services, (5) FMR's
management of the relationships with the fund's custodian and
subcustodians, (6) the resources devoted to and the record of
compliance with the fund's investment policies and restrictions and
with policies on personal securities transactions and (7) the nature,
cost, and character of non-investment management services provided by
FMR and its affiliates.
In response to questions raised by the Independent Trustees,
additional information was furnished by FMR including, among other
items, information on and analysis of (a) the overall organization of
FMR, (b) the impact of performance adjustments to management fees, (c)
the choice of performance indices and benchmarks, (d) the composition
of peer groups of funds, (e) transfer agency and bookkeeping fees paid
to affiliates of FMR, (f) investment performance, (g) investment
management staffing, (h) the potential for achieving further economies
of scale, (i) operating expenses paid to third parties, and (j) the
information furnished to investors, including the fund's shareholders.
In considering the Amended Contract, the Board of Trustees and the
Independent Trustees did not identify any single factor as
all-important or controlling, and the following summary does not
detail all of the matters considered. Matters considered by the Board
of Trustees and the Independent Trustees in connection with their
annual review of fund contractual arrangements and in connection with
their approval of the Amended Contract include the following:
BENEFITS TO SHAREHOLDERS. The Board of Trustees and the
Independent Trustees considered the benefit to shareholders of
investing in a fund that is part of a large family of funds offering a
variety of investment disciplines and providing for a large variety of
fund and shareholder services. With regard to the proposed
modification to the Present Contract's amendment provisions, the Board
of Trustees and the Independent Trustees considered the benefit to
shareholders of FMR's and the trust's increased flexibility (within
1940 Act constraints) to amend the Management Contract without the
delays and potential costs of a proxy solicitation.
INVESTMENT COMPLIANCE AND PERFORMANCE. The Board of Trustees and the
Independent Trustees considered whether the fund has operated within
its investment objective and its record of compliance with its
investment restrictions. They also reviewed monthly the fund's
investment performance as well as the performance of a peer group of
mutual funds, and the performance of an appropriate index or
combination of indices.
FMR'S PERSONNEL AND METHODS. The Board of Trustees and the
Independent Trustees review at least annually the background of the
fund's portfolio manager, and the fund's investment objective and
discipline. The Independent Trustees have also had discussions with
senior management of FMR responsible for investment operations, and
the senior management of Fidelity's equity group. Among other things
they considered the size, education and experience of FMR's investment
staff, its use of technology, and FMR's approach to recruiting,
training and retaining portfolio managers and other research, advisory
and management personnel.
NATURE AND QUALITY OF OTHER SERVICES. The Board of Trustees and the
Independent Trustees considered the nature, quality, cost and extent
of administrative and shareholder services performed by FMR and
affiliated companies, both under the Present Contract and the Amended
Contract and under separate agreements covering transfer agency
functions and pricing, bookkeeping and securities lending services, if
any. The Board of Trustees and the Independent Trustees have also
considered the nature and extent of FMR's supervision of third party
service providers, principally custodians and subcustodians.
EXPENSES. The Board of Trustees and the Independent Trustees
considered the fund's expense ratio and expense ratios of a peer group
of funds. They also considered the amount and nature of fees paid by
shareholders.
PROFITABILITY. The Board of Trustees and the Independent Trustees
considered the level of FMR's profits in respect of the management of
the Fidelity funds, including the fund. This consideration included an
extensive review of FMR's methodology in allocating its costs to the
management of the fund. The Board of Trustees and the Independent
Trustees have concluded that the cost allocation methodology employed
by FMR has a reasonable basis and is appropriate in light of all of
the circumstances. They considered the profits realized by FMR in
connection with the operation of the fund and whether the amount of
profit is a fair entrepreneurial profit for the management of the
fund. They also considered the profits realized from non-fund
businesses which may benefit from or be related to the fund's
business. The Board of Trustees and the Independent Trustees also
considered FMR's profit margins in comparison with available industry
data, both accounting for and ignoring marketing expenses.
ECONOMIES OF SCALE. The Board of Trustees and the Independent
Trustees considered whether there have been economies of scale in
respect of the management of the Fidelity funds, whether the Fidelity
funds (including the fund) have appropriately benefited from any
economies of scale, and whether there is potential for realization of
any further economies of scale. The Board of Trustees and the
Independent Trustees have concluded that FMR's mutual fund business
presents some limited opportunities to realize economies of scale and
that these economies are being shared between fund shareholders and
FMR in an appropriate manner. The Independent Trustees also considered
factors bearing on the choice of the fund's Performance Adjustment
Index including the nature of securities included in such index and
the nature of securities held and permitted to be held by the fund.
OTHER BENEFITS TO FMR. The Board of Trustees and the Independent
Trustees also considered the character and amount of fees paid by the
fund and the fund's shareholders for services provided by FMR and its
affiliates, including fees for services like transfer agency, fund
accounting and direct shareholder services. They also considered the
allocation of fund brokerage to brokers affiliated with FMR and the
receipt of sales loads and payments under Rule 12b-1 plans in respect
of certain of the Fidelity funds. The Board of Trustees and the
Independent Trustees also considered the revenues and profitability of
FMR businesses other than its mutual fund business, including FMR's
retail brokerage, correspondent brokerage, capital markets, trust,
investment advisory, pension record keeping, insurance, publishing,
real estate, international research and investment funds, and others.
The Board of Trustees and the Independent Trustees considered the
intangible benefits that accrue to FMR and its affiliates by virtue of
their relationship with the fund.
CONCLUSION. 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 foregoing summary does
not detail all of the matters considered. Based on their evaluation of
all material factors and assisted by the advice of independent
counsel, the Trustees concluded that the proposed modifications to the
management fee rate, that is the adoption of the Proposed Index, and
the proposed modification to the Present Contract's amendment
provisions are in the best interest of the fund's shareholders. The
Board of Trustees, including the Independent Trustees, voted to
approve the submission of the Amended Contract to shareholders of the
fund and recommends that shareholders of the fund vote FOR the Amended
Contract. If approved, the Amended Contract will take effect on the
first day of the first month following shareholder approval.
OTHER BUSINESS
The Board knows of no other business to be brought before the
Meeting. However, if any other matters properly come before the
Meeting, it is the intention that proxies that do not contain specific
instructions to the contrary will be voted on such matters in
accordance with the judgment of the persons therein designated.
ACTIVITIES AND MANAGEMENT OF FMR
FMR, a corporation organized in 1946, serves as investment adviser to
a number of investment companies. Information concerning the advisory
fees and average net assets of funds with investment objectives
similar to the fund , and advised by FMR is contained in the
Table of Average Net Assets and Expense Ratios in Exhibit 2 beginning
on page 23 .
FMR, its officers and directors, its affiliated companies, and the
Trustees, from time to time have transactions with various banks,
including the custodian banks for certain of the funds advised by FMR.
Those transactions that have occurred to date have included mortgages
and personal and general business loans. In the judgment of FMR, the
terms and conditions of those transactions were not influenced by
existing or potential custodial or other fund relationships.
The Directors of FMR are: Edward C. Johnson 3d, Chairman of the Board
and of the Executive Committee; Robert C. Pozen, President; and Peter
S. Lynch, Vice Chairman. Each of the Directors is also a Trustee of
the trust. Messrs. Johnson 3d, Pozen, J. Gary Burkhead, John H.
Costello, Eric D. Roiter, Richard A. Silver, Matthew N.
Karstetter , Leonard M. Rush, Robert A. Lawrence, Abigail
Johnson, Richard A. Spillane Jr., and Greg Fraser are currently
officers of the trust and officers or employees of FMR or FMR Corp.
With the exception of Mr. Costello and Mr. Karstetter , 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.
Between the dates of November 1, 1998, and March 31, 1999, the
aggregate of Edward C. Johnson 3d's transactions totalled 71,035
shares of Series A Participating Preferred Stock. These transactions
are more than 1% of all total vested Series A Participating Preferred
Stock as well as more than 1% of all total vested FMR Corp. stock.
No other trustees entered into transactions totalling more than 1% of
the total vested voting common, non-voting common and equivalent
stock, or preferred FMR Corp. stock.
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 the f und ,
managed by FMR , with respect to which FMR currently has
sub-advisory agreements with either FMR U.K. or FMR Far East, and the
net assets of each of these funds, are indicated in the Table of
Average Net Assets and Expense Ratios in Exhibit 2 beginning on page
23 .
The Directors of FMR U.K. and FMR Far East are Edward C. Johnson 3d,
Chairman, and Robert C. Pozen, President. Mr. Johnson 3d also is
President and a Trustee of the trust and other funds advised by FMR;
Chairman and a Director of Fidelity Investments Money Management, Inc.
(FIMM); Chairman, Chief Executive Officer, President, and a Director
of FMR Corp., and a Director and Chairman of the Board and of the
Executive Committee of FMR. In addition, Mr. Pozen is Senior Vice
President and a Trustee of the trust and of other funds advised by
FMR; President and a Director of FMR; and President and a Director of
FIMM. Each of the Directors is a stockholder of FMR Corp. The
principal business address of the Directors is 82 Devonshire Street,
Boston, Massachusetts 02109.
ACTIVITIES AND MANAGEMENT OF FIIA AND FIIAL U.K.
F MR, on behalf of the fund, has entered into a sub-advisory
agreement with FIIA, a wholly owned subsidiary 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. 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 the f und 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 2 beginning on page 23 .
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
$ 72,461,122 and $ 42,716,548 as of December 31,
199 8 . 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
The fund employs FMR to furnish investment advisory and other
services. Under its management contract with the fund, FMR acts
as investment adviser and, subject to the supervision of the Board of
Trustees, directs the investments of the fund in accordance
with its investment objective, policies, and limitations. FMR also
provides the fund with all necessary office facilities and
personnel for servicing the fund's investments, compensates all
officers of the fund and all Trustees who are "interested
persons" of the trust or of FMR, and all personnel of the fund
or FMR performing services relating to research, statistical, and
investment activities.
In addition, FMR or its affiliates, subject to the supervision of the
Board of Trustees, provide the management and administrative services
necessary for the operation of the fund. These services include
providing facilities for maintaining the fund's organization;
supervising relations with custodians, transfer and pricing agents,
accountants, underwriters, and other persons dealing with the
fund; preparing all general shareholder communications and conducting
shareholder relations; maintaining the fund's records and the
registration of the fund's shares under federal and state laws;
developing management and shareholder services for the fund;
and furnishing reports, evaluations, and analyses on a variety of
subjects to the Trustees. Services provided by affiliates of FMR will
continue under the proposed management contract described in Proposal
1.
In addition to the management fee payable to FMR, the 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
the fund's current management contract provides that it
will pay for typesetting, printing, and mailing prospectuses,
statements of additional information, notices, and reports to
shareholders, the trust, on behalf of the fund has entered into
a revised transfer agent agreement with FSC, pursuant to which FSC
bears the costs of providing these services to existing shareholders.
Other expenses paid by the fund include interest, taxes,
brokerage commissions, and the fund's proportionate share of
insurance premiums and Investment Company Institute dues. The
fund is also liable for such non-recurring expenses as may arise,
including costs of any litigation to which the fund may be a
party, and any obligation it may have to indemnify its officers and
Trustees with respect to litigation.
Transfer agent fees and pricing and bookkeeping fees, including
reimbursement for out-of-pocket expenses, paid to FSC by the
fund for fiscal 1998 amounted to $5,807,851.
The fund also has a distribution agreement with FDC, a
Massachusetts corporation organized on July 18, 1960. FDC is a
broker-dealer registered under the Securities Exchange Act of 1934 and
is a member of the National Association of Securities Dealers, Inc.
The distribution agreement calls for FDC to use all reasonable
efforts, consistent with its other business, to secure purchasers for
shares of the fund, which are continuously offered at net
asset value per share . Promotional and administrative expenses in
connection with the offer and sale of shares are paid by FMR.
For the services of FMR under its management contract, the
fund pays FMR a monthly management fee which has two components: a
basic fee, which is the sum of a group fee rate and an individual fund
fee rate, and a performance adjustment based on a comparison of the
fund's performance to that of the Morgan Stanley Capital International
Europe, Australasia and Far East Index (GDP weighted) (EAFE
(GDP-weighted)).
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 $ 748 billion of group net assets - the approximate
level for April 1999 - was 0. 2824 %, which is the
weighted average of the respective fee rates for each level of group
net assets up to $ 748 billion.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES
Average Group Assets Annualized Rate Group Net Assets Effective Annual Fee Rate
$0 - 3 billion .5200% $ 0.5 billion .5200%
3 - 6 .4900 25 .4238
6 - 9 .4600 50 .3823
9 - 12 .4300 75 .3626
12 - 15 .4000 100 .3512
15 - 18 .3850 125 .3430
18 - 21 .3700 150 .3371
21 - 24 .3600 175 .3325
24 - 30 .3500 200 .3284
30 - 36 .3450 225 .3249
36 - 42 .3400 250 .3219
42 - 48 .3350 275 .3190
48 - 66 .3250 300 .3163
66 - 84 .3200 325 .3137
84 - 102 .3150 350 .3113
102 - 138 .3100 375 .3090
138 - 174 .3050 400 .3067
174 - 210 .3000 425 .3046
210 - 246 .2950 450 .3024
246 - 282 .2900 475 .3003
282 - 318 .2850 500 .2982
318 - 354 .2800 525 .2962
354 - 390 .2750 550 .2942
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
Over 534 .2500
</TABLE>
The individual fund fee rate for the fund is 0.45%. Based on
the average group net assets of the funds advised by FMR for April
1999, the fund's annual basic fee rate would be as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Group Fee Rate Individual Fund Fee Rate Basic Fee Rate
Diversified International 0.2824% .45% 0.7324%
</TABLE>
One-twelfth of this annual basic fee rate is applied to the
fund ' s net assets averaged for the most recent month, giving a
dollar amount, which is the fee for that month.
COMPUTING THE PERFORMANCE ADJUSTMENT. The basic fee is subject to
upward or downward adjustment, depending upon whether, and to what
extent, the fund's investment performance for the performance period
exceeds, or is exceeded by, the record of the EAFE (GDP-weighted) over
the same period. The performance period consists of the most recent
month plus the previous 35 months. Each percentage point of
difference, calculated to the nearest .01 % (up to a maximum
difference of +/-10.00) is multiplied by a performance adjustment rate
of 0.02%. Thus, the maximum annualized adjustment rate is +/-0.20%.
This performance comparison is made at the end of each month. One
twelfth (1/12) of this rate is then applied to Diversified
International's average net assets for the entire performance period,
giving a dollar amount which will be added to (or subtracted from) the
basic fee.
The fund's performance is calculated based on change in net
asset value (NAV). For purposes of calculating the performance
adjustment, any dividends or capital gain distributions paid by the
fund are treated as if reinvested in fund shares at the NAV as of the
record date for payment. The record of the EAFE (GDP-weighted) is
based on change in value and is adjusted for any cash distributions
from the companies whose securities compose the index.
Because the adjustment to the basic fee is based on the f und's
performance compared to the investment record of the EAFE
(GDP-weighted), the controlling factor is not whether the fund's
performance is up or down per se, but whether it is up or down more or
less than the record of the index. Moreover, the comparative
investment performance of the fund is based solely on the relevant
performance period without regard to the cumulative performance over a
longer or shorter period of time.
During fiscal 1998, FMR received $15,442,573 from the fund
for its services as investment adviser (these fees include the
performance adjustment) . The fee was equivalent to .8348% of the
average net assets of the fund.
FMR may, from time to time, agree to reimburse all or a portion of
the fund's total 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.
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are
placed on behalf of the fund by FMR pursuant to authority
contained in the fund's management contract.
FMR may place agency transactions with National Financial Services
Corporation (NFSC) and Fidelity Brokerage Services (Japan), LLC
(FBSJ), indirect subsidiaries of FMR Corp., if the commissions are
fair, reasonable, and comparable to commissions charged by
non-affiliated, qualified brokerage firms for similar services. Prior
to December 9, 1997, FMR used research services provided by and placed
agency transactions with Fidelity Brokerage Services (FBS), an
indirect subsidiary of FMR Corp.
For the fiscal year ended October 31, 1998, the fund paid
brokerage commissions of $82,815 to NFSC and $27,870 to FBS. During
fiscal 1998 this amounted to 1.29% and 0.43%, respectively of the
aggregate commissions paid by the fund.
SUBMISSION OF CERTAIN SHAREHOLDER PROPOSALS
The trust does not hold annual shareholder meetings. Shareholders
wishing to submit proposals for inclusion in a proxy statement for a
subsequent shareholder meeting should send their written proposals to
the Secretary of the Trust, 82 Devonshire Street, Boston,
Massachusetts 02109.
NOTICE TO BANKS, BROKER-DEALERS AND
VOTING TRUSTEES AND THEIR NOMINEES
Please advise the trust, in care of Fidelity Service Company, Inc.,
P.O. Box 789, Boston, Massachusetts 02102, 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
For purposes of thre SEC filing, langauge that is underlined is set
forth in [[ double brackets]].
[[UNDERLINED]] LANGUAGE WILL BE ADDED
[BRACKETED] LANGUAGE 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 this 1st __ day of _____ [October
1997] 19__, 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] [[October 1, 1997]], to
a modification of said Contract in the manner set forth below. The
Amended Management Contract shall when executed by duly authorized
officers of the Fund and the Adviser, take effect on the later of
[October 1, 1997] [[August 1, 1999]] 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. [[Except as otherwise provided in
sub-paragraph (e) of this paragraph 3, t]](T)he 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, Australasia, and Far East Index
[("GDP- weighted")] ([[CAP-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 Basic Fee and the Performance Adjustment will be computed
as follows:
(a) Basic Fee Rate: The annual Basic Fee Rate shall be the sum of
the Group Fee Rate and the Individual Fund Fee Rate calculated to the
nearest millionth decimal place as follows:
(i) Group Fee Rate. The Group Fee Rate shall be based upon the
monthly average of the net assets of the registered investment
companies having Advisory and Service or Management Contracts with the
Adviser (computed in the manner set forth in the fund's Declaration of
Trust or other organizational document) determined as of the close of
business on each business day throughout the month. The Group Fee Rate
shall be determined on a cumulative basis pursuant to the following
schedule:
Average Net Assets Annualized Fee Rate (for each
level)
0 - $3 billion .5200%
3 - 6 .4900
6 - 9 .4600
9 - 12 .4300
12 - 15 .4000
15 - 18 .3850
18 - 21 .3700
21 - 24 .3600
24 - 30 .3500
30 - 36 .3450
36 - 42 .3400
42 - 48 .3350
48 - 66 .3250
66 - 84 .3200
84 - 102 .3150
102 - 138 .3100
138 - 174 .3050
174 - 210 .3000
210 - 246 .2950
246 - 282 .2900
282 - 318 .2850
318 - 354 .2800
354 - 390 .2750
390 - 426 .2700
426 - 462 .2650
462 - 498 .2600
498 - 534 .2550
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: [[Except as provided in
sub-paragraph (e) of this paragraph 3]], the Performance Adjustment
Rate is 0.02% for each percentage point (the performance of the
Portfolio and the Index each being calculated to the nearest 0.01%)
that the Portfolio's investment performance for the performance period
was better or worse than the record of the Index as then constituted.
The maximum 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] consists 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) For the 35-month period commencing on ______________, 1999
(the Commencement Date) (such period hereafter referred to as the
Transition Period), the Performance Adjustment Rate shall be
calculated by comparing the Portfolio's investment performance against
the blended investment records of the Index and the Morgan Stanley
Capital International Europe, Australasia and Far East Index
(GDP-weighted) (the index used to calculate the Portfolio's
Performance Adjustment prior to the Commencement Date (the Prior
Index)), such calculation being performed as follows:
For the first month of the Transition Period, the Performance
Adjustment Rate shall be calculated by comparing the Portfolio's
investment performance over the 36 month performance period against a
blended index investment record that reflects the investment record of
the Prior Index for the first 35 months of the performance period and
the investment record of the Index for the 36th month of the
performance period. For each subsequent month of the Transition
Period, the Performance Adjustment Rate shall be calculated by
comparing the Portfolio's investment performance over the 36-month
performance period against a blended index investment record that
reflects one additional month of the Index's performance and one less
month of the Prior Index's performance. This calculation methodology
shall continue until the expiration of the Transition Period, at which
time the investment record of the Prior Index shall be eliminated from
the Performance Adjustment calculation, and the calculation shall
include on the investment record of the Index.]]
[e]([[f]]) 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, [1998] 2000 and indefinitely thereafter, but only so long as the
continuance after such date shall be specifically approved at least
annually by vote of the Trustees of the Fund or by vote of a majority
of the outstanding voting securities of the Portfolio.
(b) This Contract may be modified by mutual consent[, such consent
on the part of the Fund to be authorized by vote of a majority of the
outstanding voting securities of the Portfolio] [[subject to the
provisions of Section 15 of the 1940 Act, as modified by or
interpreted by any applicable order or orders of the Securities and
Exchange Commission (the "Commission") or any rules or regulations
adopted by, or interpretative releases of, the Commission.]]
(c) In addition to the requirements of sub-paragraphs (a) and (b) of
this paragraph 6, the terms of any continuance or modification of this
Contract must have been approved by the vote of a majority of those
Trustees of the Fund who are not parties to the Contract or interested
persons of any such party, cast in person at a meeting called for the
purpose of voting on such approval.
(d) Either party hereto may, at any time on sixty (60) days' prior
written notice to the other, terminate this Contract, without payment
of any penalty, by action of its Trustees or Board of Directors, as
the case may be, or with respect to the Portfolio by vote of a
majority of the outstanding voting securities of the Portfolio. This
Contract shall terminate automatically in the event of its assignment.
7. The Adviser is hereby expressly put on notice of the limitation of
shareholder liability as set forth in the Fund's Declaration of Trust
or other organizational document and agrees that the obligations
assumed by the Fund pursuant to this Contract shall be limited in all
cases to the Portfolio and its assets, and the Adviser shall not seek
satisfaction of any such obligation from the shareholders or any
shareholder of the Portfolio or any other Portfolios of the Fund. In
addition, the Adviser shall not seek satisfaction of any such
obligations from the Trustees or any individual Trustee. The Adviser
understands that the rights and obligations of any Portfolio under the
Declaration of Trust or other organizational document are separate and
distinct from those of any and all other Portfolios.
8. This Agreement shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Massachusetts, without giving
effect to the choice of laws provisions thereof.
The terms "vote of a majority of the outstanding voting securities,"
"assignment," and "interested persons," when used herein, shall have
the respective meanings specified in the 1940 Act, as now in effect or
as hereafter amended, and subject to such orders as may be granted by
the Commission.
IN WITNESS WHEREOF the parties have caused this instrument to be
signed in their behalf by their respective officers thereunto duly
authorized, and their respective seals to be hereunto affixed, all as
of the date written above.
[signature lines omitted]
EXHIBIT 2
FUNDS ADVISED BY FMR - TABLE OF AVERAGE NET ASSETS AND EXPENSE
RATIOS (A)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
INVESTMENT OBJECTIVE AND FUND FISCAL YEAR END (A) AVERAGE NET ASSETS RATIO OF NET ADVISORY FEES
(MILLIONS)(B) TO AVERAGE NET ASSETS PAID
TO FMR (C)
GROWTH
Select Portfolios:
Air Transportation ((pound)) 2/28/99 $ 98.2 0.58%
Automotive ((pound)) 2/28/99 60.6 0.59
Biotechnology ((pound)) 2/28/99 574.0 0.59
Brokerage and Investment 2/28/99 728.9 0.59
Management ((pound))
Business Services and 2/28/99 55.4 0.59
Outsourcing ((pound))
Chemicals ((pound)) 2/28/99 47.2 0.59
Computers ((pound)) 2/28/99 1,008.6 0.60
Construction and Housing 2/28/99 83.1 0.59
((pound))
Consumer Industries ((pound)) 2/28/99 77.9 0.59
Cyclical Industries ((pound)) 2/28/99 3.9 0.59
Defense and Aerospace 2/28/99 53.5 0.58
((pound))
Developing Communications 2/28/99 310.5 0.60
((pound))
Electronics ((pound)) 2/28/99 2,259.4 0.59
Energy ((pound)) 2/28/99 140.5 0.59
Energy Service ((pound)) 2/28/99 653.1 0.59
Environmental Services 2/28/99 20.8 0.59
((pound))
Financial Services ((pound)) 2/28/99 624.8 0.59
Food and Agriculture 2/28/99 227.4 0.59
((pound))
Gold ((pound)) 2/28/99 206.8 0.59
Health Care ((pound)) 2/28/99 2,518.2 0.59
Home Finance ((pound)) 2/28/99 1,350.2 0.58
Industrial Equipment 2/28/99 42.5 0.59
((pound))
Industrial Materials 2/28/99 16.1 0.59
((pound))
Insurance ((pound)) 2/28/99 110.1 0.59
Leisure ((pound)) 2/28/99 292.2 0.59
Medical Delivery ((pound)) 2/28/99 155.5 0.59
Medical Equipment and 2/28/99 16.1 0.60(dagger)
Systems ((pound)) **
Multimedia ((pound)) 2/28/99 130.4 0.59
Select Portfolios: - continued
Natural Gas ((pound)) 2/28/99 $ 51.5 0.59%
Natural Resources ((pound)) 2/28/99 6.5 0.59
Paper and Forest Products 2/28/99 15.0 0.59
((pound))
Precious Metals and 2/28/99 150.1 0.59
Minerals ((pound))
Regional Banks ((pound)) 2/28/99 1,247.4 0.59
Retailing ((pound)) 2/28/99 282.2 0.59
Software and Computer 2/28/99 572.6 0.59
Services ((pound))
Technology ((pound)) 2/28/99 758.6 0.60
Telecommunications ((pound)) 2/28/99 783.1 0.59
Transportation ((pound)) 2/28/99 24.4 0.58
Utilities Growth ((pound)) 2/28/99 408.1 0.59
Magellan ((pound)) 3/31/98 61,521.2 0.43
Large Cap Stock ((pound)) 4/30/98 133.9 0.45
Mid Cap Stock ((pound)) 4/30/98 1,579.2 0.60
Small Cap Selector ((pound)) 4/30/98 727.3 0.67
Small Cap Stock ((pound))** 4/30/98 383.2 0.69*(bold italic B)
Contrafund II ((pound)) 6/30/98 226.3 0.59
Fidelity Fifty ((pound)) 6/30/98 180.5 0.43
Advisor Focus Funds:
Consumer Industries: ((pound))
Class A 7/31/98 1.3 0.59
Class T 7/31/98 10.7 0.59
Class B 7/31/98 2.2 0.59
Class C 7/31/98 0.5 0.59
Institutional Class 7/31/98 2.7 0.59
Cyclical Industries: ((pound))
Class A 7/31/98 0.4 0.59
Class T 7/31/98 2.7 0.59
Class B 7/31/98 0.5 0.59
Class C 7/31/98 0.1 0.59
Institutional Class 7/31/98 1.5 0.59
Advisor Focus Funds: -
continued
Financial Services: ((pound))
Class A 7/31/98 $ 12.6 0.59%
Class T 7/31/98 82.7 0.59
Class B 7/31/98 30.1 0.59
Class C 7/31/98 8.3 0.59
Institutional Class 7/31/98 3.9 0.59
Health Care: ((pound))
Class A 7/31/98 10.5 0.59
Class T 7/31/98 79.2 0.59
Class B 7/31/98 22.1 0.59
Class C 7/31/98 6.5 0.59
Institutional Class 7/31/98 7.1 0.59
Natural Resources: ((pound))
Class A 7/31/98 6.9 0.59
Class T 7/31/98 499.5 0.59
Class B 7/31/98 54.7 0.59
Class C 7/31/98 1.6 0.59
Institutional Class 7/31/98 6.2 0.59
Technology: ((pound))
Class A 7/31/98 11.7 0.59
Class T 7/31/98 76.3 0.59
Class B 7/31/98 17.6 0.59
Class C 7/31/98 3.0 0.59
Institutional Class 7/31/98 5.2 0.59
Utilities Growth: ((pound))
Class A 7/31/98 1.4 0.59
Class T 7/31/98 13.9 0.59
Class B 7/31/98 5.9 0.59
Class C 7/31/98 1.6 0.59
Institutional Class 7/31/98 3.7 0.59
Blue Chip Growth ((pound)) 7/31/98 14,487.5 0.47
Dividend Growth ((pound)) 7/31/98 5,316.4 0.65
Low-Priced Stock ((pound)) 7/31/98 10,834.5 0.74
OTC Portfolio ((pound)) 7/31/98 4,213.9 0.50
Export and Multinational Fund 8/31/98 468.9 0.59
((pound))
Destiny I ((pound)) 9/30/98 $ 6,399.7 0.31%
Destiny II ((pound)) 9/30/98 4,058.8 0.45
Advisor Diversified
International ((rex-all)) **
Class A 10/31/99 1.1 0.74(bold italic B)
Class T 10/31/99 1.5 0.74(bold italic B)
Class B 10/31/99 1.1 0.74(bold italic B)
Class C 10/31/99 1.1 0.74(bold italic B)
Institutional Class 10/31/99 1.0 0.74(bold italic B)
Advisor Europe Capital
Appreciation ((rex-all)) **
Class A 10/31/99 0.5 0.74(bold italic B)
Class T 10/31/99 2.1 0.74(bold italic B)
Class B 10/31/99 0.7 0.74(bold italic B)
Class C 10/31/99 0.8 0.74(bold italic B)
Institutional Class 10/31/99 0.4 0.74(bold italic B)
Advisor Global Equity
((rex-all)) **
Class A 10/31/99 1.1 0.74(bold italic B)
Class T 10/31/99 1.2 0.74(bold italic B)
Class B 10/31/99 1.1 0.74(bold italic B)
Class C 10/31/99 1.1 0.74(bold italic B)
Institutional Class 10/31/99 1.1 0.74(bold italic B)
Advisor International Capital
Appreciation: ((rex-all)) **
Class A 10/31/98 0.6 0.73(dagger)
Class T 10/31/98 6.9 0.73(dagger)
Class B 10/31/98 2.3 0.73(dagger)
Class C 10/31/98 1.3 0.73(dagger)
Institutional Class 10/31/98 5.0 0.73(dagger)
Advisor Japan ((rex-all)) **
Class A 10/31/99 0.4 0.74(bold italic B)
Class T 10/31/99 0.4 0.74(bold italic B)
Class B 10/31/99 0.4 0.74(bold italic B)
Class C 10/31/99 0.4 0.74(bold italic B)
Institutional Class 10/31/99 0.4 0.74(bold italic B)
Advisor Latin America
((rex-all)) **
Class A 10/31/99 $ 0.4 0.74(bold italic B)%
Class T 10/31/99 0.4 0.74(bold italic B)
Class B 10/31/99 0.4 0.74(bold italic B)
Class C 10/31/99 0.4 0.74(bold italic B)
Institutional Class 10/31/99 0.4 0.74(bold italic B)
Advisor Overseas: ((epslon))
Class A 10/31/98 8.5 0.89
Class T 10/31/98 1,159.5 0.89
Class B 10/31/98 51.9 0.89
Class C 10/31/98 6.1 0.89
Institutional Class 10/31/98 47.3 0.89
Canada ((epslon)) 10/31/98 71.9 0.30
Capital Appreciation ((pound)) 10/31/98 2,379.7 0.44
Disciplined Equity ((pound)) 10/31/98 2,857.4 0.43
Diversified International 10/31/98 1,849.8 0.83
((epslon))
Emerging Markets ((epslon)) 10/31/98 390.9 0.74
Europe ((epslon)) 10/31/98 1,399.6 0.73
Europe Capital Appreciation 10/31/98 594.4 0.72
((epslon))
France ((epslon)) 10/31/98 12.5 0.73
Germany ((epslon)) 10/31/98 23.7 0.73
Hong Kong and China ((rex-all)) 10/31/98 154.3 0.74
International Value ((rex-all)) 10/31/98 454.5 0.82
Japan ((rex-all)) 10/31/98 238.4 1.01
Japan Small Companies 10/31/98 95.1 0.74
((rex-all))
Latin America ((epslon)) 10/31/98 594.2 0.75
Nordic ((epslon)) 10/31/98 104.3 0.74
Overseas ((epslon)) 10/31/98 3,862.7 0.90
Pacific Basin ((rex-all)) 10/31/98 206.8 1.11
Southeast Asia ((rex-all)) 10/31/98 235.6 1.16
Stock Selector ((pound)) 10/31/98 1,885.4 0.43
TechnoQuant Growth 10/31/98 67.4 0.39
United Kingdom ((epslon)) 10/31/98 7.5 0.74
Value ((pound)) 10/31/98 7,451.9 0.41
Worldwide ((epslon)) 10/31/98 1,169.1 0.74
Advisor Dividend Growth
((pound))**
Class A 11/30/99 $ 0.5 0.59(bold italic B)%
Class T 11/30/99 5.1 0.59(bold italic B)
Class B 11/30/99 3.4 0.59(bold italic B)
Class C 11/30/99 1.2 0.59(bold italic B)
Institutional Class 11/30/99 0.9 0.59(bold italic B)
Advisor Equity Growth:
((pound))
Class A 11/30/98 56.8 0.59
Class T 11/30/98 4,568.3 0.59
Class B 11/30/98 166.9 0.59
Class C 11/30/98 26.0 0.59
Institutional Class 11/30/98 1,004.7 0.59
Advisor Growth
Opportunities:((pound))
Class A 11/30/98 255.0 0.46
Class T 11/30/98 22,748.7 0.46
Class B 11/30/98 925.6 0.46
Class C 11/30/98 146.1 0.46
Institutional Class 11/30/98 493.0 0.46
Advisor Large Cap: ((pound))
Class A 11/30/98 3.1 0.59
Class T 11/30/98 59.5 0.59
Class B 11/30/98 27.5 0.59
Class C 11/30/98 1.5 0.59
Institutional Class 11/30/98 7.7 0.59
Advisor Mid Cap: ((pound))
Class A 11/30/98 8.2 0.59
Class T 11/30/98 357.3 0.59
Class B 11/30/98 73.2 0.59
Class C 11/30/98 6.5 0.59
Institutional Class 11/30/98 35.4 0.59
Advisor Retirement Growth
((pound))**
Class A 11/30/99 0.2 0.59(bold italic B)
Class T 11/30/99 0.5 0.59(bold italic B)
Class B 11/30/99 0.2 0.59(bold italic B)
Class C 11/30/99 0.2 0.59(bold italic B)
Institutional Class 11/30/99 0.2 0.59(bold italic B)
Advisor Small Cap: ((pound))**
Class A 11/30/98 $ 4.2 0.74(bold italic B)%
Class T 11/30/98 30.2 0.74(bold italic B)
Class B 11/30/98 9.5 0.74(bold italic B)
Class C 11/30/98 9.4 0.74(bold italic B)
Institutional Class 11/30/98 8.2 0.74(bold italic B)
Advisor Strategic
Opportunities: ((pound))
Class A 11/30/98 3.5 0.38
Class T 11/30/98 491.8 0.38
Class B 11/30/98 109.5 0.38
Initial Class 11/30/98 20.2 0.38
Institutional Class 11/30/98 4.7 0.38
Advisor TechnoQuant Growth:
((pound))
Class A 11/30/98 3.8 0.59
Class T 11/30/98 18.3 0.59
Class B 11/30/98 11.6 0.59
Class C 11/30/98 0.3 0.59
Institutional Class 11/30/98 1.3 0.59
Emerging Growth ((pound)) 11/30/98 2,172.0 0.79
Growth Company ((pound)) 11/30/98 10,377.6 0.42
New Millennium ((pound)) 11/30/98 1,525.9 0.62
Retirement Growth ((pound)) 11/30/98 4,376.5 0.40
Contrafund ((pound)) 12/31/98 33,442.4 0.45
Trend ((pound)) 12/31/98 1,354.1 0.39
Variable Insurance Products:
Growth
Initial Class 12/31/98 9,027.5 0.59
Service Class 12/31/98 50.6 0.59
Overseas ((epslon))
Initial Class 12/31/98 2,073.3 0.74
Service Class 12/31/98 15.9 0.74
Variable Insurance Products II:
Asset Manager: Growth
((pound))
Initial Class 12/31/98 495.2 0.59
Service Class 12/31/98 1.1 0.59
Contrafund ((pound))
Initial Class 12/31/98 $ 4,974.2 0.59%
Service Class 12/31/98 61.3 0.59
Variable Insurance Products
III:
Growth Opportunities ((pound))
Initial Class 12/31/98 1,296.4 0.59
Service Class 12/31/98 66.4 0.59
Mid Cap ((pound))**
Initial Class 12/31/98 0.5 .59(bold italic B)
Service Class 12/31/98 0.5 .59(bold italic B)
</TABLE>
(a) All fund data are as of the fiscal year end noted in the chart
or as of January 31, 1999, if fiscal year end figures are not yet
available.
(b) Average net assets are computed on the basis of average net
assets of each fund or class at the close of business on each business
day throughout its fiscal period.
(c) Reflects reductions for any expense reimbursement paid by or
due from FMR pursuant to voluntary or state expense limitations. Funds
so affected are indicated by an (*). The ratio for certain multi-class
funds is presented gross of expense reductions for presentation
purposes.
(dagger) Annualized
** Less than a complete fiscal year
((bold italic B)) Based on estimated expenses for the first
year
((rex-all)) Fidelity Management & Research Company (FMR) has
entered into sub-advisory agreements with the following affiliates:
Fidelity Management & Research (U.K.) Inc. (FMR U.K.), Fidelity
Management & Research (Far East) Inc. (FMR Far East), Fidelity
Investments Japan Ltd. (FIJ), Fidelity International Investment
Advisors (FIIA), and Fidelity International Investment Advisors (U.K.)
Limited (FIIA (U.K.) L), with respect to the fund.
((epslon)) FMR has entered into sub-advisory agreements with the
following affiliates: FMR U.K., FMR Far East, FIIA, and FIIA (U.K.) L,
with respect to the fund.
((pound)) FMR has entered into sub-advisory agreements with FMR
U.K. and FMR Far East, with respect to the fund.
INV-pxs-0599 CUSIP#315910802/FUND#325
1.715377.100
Vote this proxy card TODAY! Your prompt response will
save the expense of additional mailings.
Return the proxy card in the enclosed envelope or mail to:
FIDELITY INVESTMENTS
Proxy Department
P.O. Box 9107
Hingham, MA 02043-9848
PLEASE DETACH AT PERFORATION BEFORE MAILING.
- ----------------------------------------------------------------------
FIDELITY INVESTMENT TRUST: FIDELITY DIVERSIFIED INTERNATIONAL FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward
C. Johnson 3d, Gerald C. McDonough, and Eric D. Roiter, or any one or
more of them, attorneys, with full power of substitution, to vote all
shares of FIDELITY INVESTMENT TRUST as indicated above 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 July 14, 1999, at 10:00 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 _____________, 1999
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
(325 HH)
Please refer to the Proxy Statement discussion of each of these
matters.
IF NO SPECIFICATION IS MADE, THE PROXY SHALL BE VOTED FOR THE
PROPOSAL.
As to any other matter, said attorneys shall vote in accordance with
their best judgment.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR THE FOLLOWING:
- ----------------------------------------------------------------------
1. To approve an amended FOR [ ] AGAINST [ ] ABSTAIN [ ] 1.
management contract the fund.
INV pxc 0399 cusip #315910802 #325H
IMPORTANT PROXY MATERIALS
PLEASE CAST YOUR VOTE NOW!
FIDELITY DIVERSIFIED INTERNATIONAL FUND
Dear Shareholder:
I am writing to let you know that a special meeting of shareholders of
Fidelity Diversified International Fund will be held on July 14, 1999.
The purpose of the meeting is to vote on an important proposal that
affects the fund and your investment in it. As a shareholder, you
have the opportunity to voice your opinion on the matters that affect
your fund. This package contains information about the proposal 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.
The proposal has 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 the proposal is in the best interest of shareholders.
They recommend that you vote for the proposal.
The following Q&A is provided to assist you in understanding the
proposal which is described in greater detail in the enclosed proxy
statement.
VOTING IS QUICK AND EASY. EVERYTHING YOU NEED IS ENCLOSED. To cast
your vote, simply complete the proxy card(s) enclosed in this package.
Be sure to sign the card(s) before mailing it in the postage-paid
envelope.
If you have any questions before you vote, please call Fidelity 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
Chairman and Chief Executive Officer
Important information to help you understand and vote on the proposal
Please read the full text of the enclosed proxy statement. Below is a
brief overview of the proposal to be voted upon. Your vote is
important. We appreciate you placing your trust in Fidelity and look
forward to helping you achieve your financial goals.
WHAT PROPOSAL AM I BEING ASKED TO VOTE ON?
You are being asked to approve an amended management contract for
Fidelity Diversified International Fund.
WHY IS FIDELITY DIVERSIFIED INTERNATIONAL FUND PROPOSING AN AMENDED
MANAGEMENT CONTRACT?
The amended management contract changes the benchmark used to
calculate the fund's performance adjustment. The performance
adjustment provides that FMR's management fee may be increased or
decreased based on the fund's performance relative to a market
benchmark. The fund's amended management contract also allows FMR and
the trust, on behalf of the fund, to modify the fund's management
contract subject to the requirements of the Investment Company Act of
1940.
WHY IS FIDELITY DIVERSIFIED INTERNATIONAL FUND PROPOSING TO CHANGE ITS
PERFORMANCE ADJUSTMENT BENCHMARK?
Fidelity Diversified International Fund currently uses the Morgan
Stanley Capital International Europe, Australasia, and Far East Index
(GDP-Weighted) (Current Index) as its benchmark to calculate its
performance adjustment. If the proposal is approved, the fund will
change its benchmark to the Morgan Stanley Capital International
Europe, Australasia, and Far East Index (Capitalization-Weighted)
(Proposed Index).
The Proposed Index and the Current Index are the same in that they are
both designed to measure the performance of the same countries, but
they differ in how they allocate the country weightings within the
index. The GDP-weighted version of the index allocates among
countries based on the relative size of a country's economy, while the
Capitalization-weighted version of the index allocates among countries
based on the size of a country's stock market. The Proposed Index
would more closely align the fund with the other broadly diversified
funds in its competitive universe.
WOULD APPROVAL OF THE AMENDED MANAGEMENT CONTRACT FOR FIDELITY
DIVERSIFIED INTERNATIONAL FUND INVOLVE CHANGES TO THE FUND'S
INVESTMENT POLICIES OR GUIDELINES, OR CHANGE THE PORTFOLIO MANAGER'S
STRATEGIES FOR THIS FUND?
No. The proposal would not change any investment policies, or the
portfolio manager's strategies for the fund.
HAS THE FUND'S BOARD OF TRUSTEES APPROVED THE PROPOSAL?
Yes. The Board of Trustees has unanimously approved the proposal and
recommends that you vote to approve it.
HOW MANY VOTES AM I ENTITLED TO CAST?
As a shareholder, you are entitled to one vote for each dollar of net
asset value you own of the fund on the record date. The record date
is May 24, 1999.
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 any assistance, or have any questions regarding the proposal or
how to vote your shares, please call Fidelity 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."
